KINGSWAY_LIF_HOLDINGS_LTD - Accounts

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

Kingsway LIF Holdings Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 2nd Floor, 21-22 Great Castle Street, London, W1G OHZ.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest pound sterling.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

Kingsway LIF Holdings Ltd is a wholly owned subsidiary of Ludgate Northumberland Holdings Limited and the results of Kingsway LIF Holdings Ltd are included in the consolidated financial statements of Ludgate Northumberland Holdings Limited which are available from 2nd floor, 21-22 Great Castle Street, London, W1G OHZ.

The financial statements have been prepared on the going concern basis which assumes that the company will continue in operational existence for the foreseeable future, which the directors believe to be appropriate for the following reasons:

At 31 December 2020 the company had cash balances of approximately £1.5 million and in March 2021 the group had the maturity date of the existing bank loan facility of £46 million extended to March 2024.

The directors have considered the potential impact of a continuation of the COVID-19 pandemic and the uncertainty surrounding the potential effects of Brexit on the company and do not believe these will impair the company's ability to continue as a going concern.

Turnover represents amounts receivable for hotel revenues net of value added tax.

Revenue Recognition

Turnover represents revenue earned from provision of services to hotel guests. Revenue is recognised as earned when, and to the extent that, the company obtains the right to consideration in exchange for the provision of hotel services

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives when they are brought into use on the following bases:

Freehold land is not depreciated.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

Stock consists mainly of linen, uniforms and miscellaneous supplies. Initial base stocks are included at cost while replacement items are expensed upon their purchase and use.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

The average monthly number of persons (including directors) employed by the company during the year was:

Included in land and buildings is cost apportioned to land of £5,805,610 (2019: £5,805,610), as valued by the directors.

Fixed asset investments are not listed and are held at cost less impairment as fair value cannot be reliably determined.

Details of the investments in which the company hold 20% or more of the nominal value of any class of share capital are as follows:

Ludgate Northumberland Holdings Limited, the immediate parent of Kingsway LIF Holdings Limited has provided a guarantee under s479C of the Companies Act (2006) for Kingsway LIF Retail Limited. Therefore, Kingsway LIF Retail Limited is exempt from the requirements of the Companies Act relating to the audit of individual accounts and the accounts are unaudited.

Kingsway Lif Retail Limited was dissolved on 27 April 2021.

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

A provision for deferred tax has been made regarding the rollover relief claimed in 2007 by a fellow subsidiary company against the property additions of the company.

At the reporting end date the company had contracted with tenants to receive the following minimum lease payments in respect of non-cancellable operating leases:

The restaurant tenant and the company agreed to end the lease in February 2020. No further rents are receivable.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

Emphasis of matter - subsequent event COVID-19 pandemic

We draw your attention to note 1.2 to the financial statements which describes the going concern considerations of the directors relating to COVID-19 a global pandemic leading to broader global economic uncertainties. Our opinion is not modified with respect to this matter.

Management fees, royalty fees and allocated overhead charged by group undertakings under common control were £nil (2019: £1,678,528).

At the year end, amounts totalling £19,176,646 (2019: £25,306,160) were due to group undertakings under common control.

The immediate parent company is Ludgate Northumberland Holdings Limited which has a 100% holding in the company. The controlling party is Financial District Associates L.P., a limited partnership registered in the State of New York USA, which has an indirect holding of 80.5% in the company.

These financial statements have been consolidated in the financial statements of Ludgate Northumberland Holdings Limited, which is the only group in which the results of the company are consolidated. The consolidated financial statements can be obtained from 2nd Floor, 21-22 Great Castle Street, London W1G 0HZ.