ACCOUNTS - Final Accounts preparation
ACCOUNTS - Final Accounts preparation
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Company Registration Number
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VAGA DEVELOPMENTS LIMITED
COMPANY INFORMATION
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VAGA DEVELOPMENTS LIMITED
CONTENTS
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VAGA DEVELOPMENTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
The directors present their report and the financial statements for the year ended 31 December 2020.
The directors are responsible for preparing the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The director who served during the year was: G Forrest (resigned 6 August 2021).
The entity was part of a sale agreement in August 2021 where it was purchased from High Street GRP Limited by Hadrian Real Estate plc.
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VAGA DEVELOPMENTS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
As at the balance sheet date the company has net liabilities of £12,510, following a loss in the period of £1,601. After the year end, the company has continued to develop the land using increased borrowings through the drawing down of available bank facilities and the receipt of monies the group which the company was part of at that time. The terms of the bank loan have been extended in the post year end period and at the date of sign off remain within their repayment date.
In August 2021, the company was sold to a new parent company. At that time there was a debt forgiveness for all group liabilities owed. The Directors plan to realise the work in progress value for the development, which will enable the residual bank loan to be repaid in full. Without realising the monies from the sale of the development, the company would not be able to repay the loan when it falls due which is within 12 months of signing these accounts. Although the Directors remain confident of gaining a further extension of time until such a sale was completed based on their experience since the balance sheet date. The directors have confirmed that the going concern basis remains appropriate as they believe the asset will be realised and all liabilities will be repaid in full.
The auditors, Armstrong Watson Audit Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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VAGA DEVELOPMENTS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VAGA DEVELOPMENTS LIMITED
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the stock and group liabilities as at 31 December 2020. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason, we have audited the financial statements of Vaga Developments Limited (the 'Company') for the year ended 31 December 2020, which comprise the Statement of Comprehensive Income, the Balance Sheet and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We were not appointed as auditor of the company until after 31 December 2020 and our appointment was made by the new shareholders following their purchase of the company in August 2021. With regards many of the transactions that arose in the period prior to the transfer of ownership, the new Directors are unable to support beyond the nominal ledger provided. As such, we have not been able to obtain confirmation from source documents in our testing. We were unable to satisfy ourselves by alternative means concerning the work in progress balances at the year end included in the balance sheet (included within stock) totalling £4,508,700, by using other procedures.
Additionally, there are amounts owed to group undertakings of £1,297,365. These have not been confirmed by direct confirmation, which we were unable to satisfy ourselves by alternative means or audit procedures as to the accuracy of these balances. These are reflected within the balance sheet under current liabilities. Consequently we were unable to determine whether any adjustment to both of these amounts was necessary.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the stock and group liabilities as at 31 December 2020. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason, we conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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VAGA DEVELOPMENTS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VAGA DEVELOPMENTS LIMITED (CONTINUED)
We draw attention to note 2.2 in the financial statements, which indicates that the company’s ability to continue as a going concern is dependent on the realisation of the work in progress. As stated in note 2.2, these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the Company's ability to continue to adopt the going concern basis of accounting included considering the units of the devlelopment which have sold with exchange of contracts awaiting final completion, the units with sales agreed without exchange, and the market price of units available for sale. We have also considered the third party funding and how this could be repaid and the potential for further extensions. As stated in in note 2.2, there are events and conditions which indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the stock and group liabilities as at 31 December 2020. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason, we have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Directors' Report has been prepared in accordance with applicable legal requirements.
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VAGA DEVELOPMENTS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VAGA DEVELOPMENTS LIMITED (CONTINUED)
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors' Report.
Arising solely from the limitation on the scope of our work, referred to above:
• we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and • we were unable to determine whether adequate accounting records have been kept. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: • returns adequate for our audit have not been received from branches not visited by us; or • the financial statements are not in agreement with the accounting records and returns; or • certain disclosures of directors’ remuneration specified by law are not made.
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VAGA DEVELOPMENTS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VAGA DEVELOPMENTS LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the stock and group liabilities as at 31 December 2020. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason, we design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations was as follows: • the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and • identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: • making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected or alleged fraud; and • we have been unable to assess the internal controls in place to mitigate risks of fraud due to the change in ownership post year end, however nothing has come to light from reviewing the transactions during the period which would indicate fraud. In address the risk of fraud through management bias and override of controls, we: • performed analytical procedures as a risk assessment tool to identify any unusual or unexpected relationships; and • used analytrical procedures over journal entries to identify unusual transactions; • considered the appropriateness of accounting estimates. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included but were not limited too: • agreeing financial statement disclosures to underlying supporting documentation; and • enquiring of management as to actual and potential litigation and claims.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions
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VAGA DEVELOPMENTS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VAGA DEVELOPMENTS LIMITED (CONTINUED)
reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Newcastle
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VAGA DEVELOPMENTS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2020
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VAGA DEVELOPMENTS LIMITED
REGISTERED NUMBER: 10951832
BALANCE SHEET
AS AT 31 DECEMBER 2020
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 10 to 13 form part of these financial statements.
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VAGA DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Vaga Developments Limited is a private company limited by shares, incorporated in England and Wales. The registered office is Rotterdam House, 116 Quayside, Newcastle upon Tyne, NE1 3DY.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
As at the balance sheet date the company has net liabilities of £12,510, following a loss in the period of £1,601. After the year end, the company has continued to develop the land using increased borrowings through the drawing down of available bank facilities and the receipt of monies the group which the company was part of at that time. The terms of the bank loan have been extended in the post year end period and at the date of sign off remain within their repayment date.
In August 2021, the company was sold to a new parent company and at that time there was a debt forgiveness for all group liabilities owed. The Director plan to realise the work in progress value for the development which will enable the loan to be repaid in full. Without realising the monies from the sale of the development, the company would not be able to repay the loan when it falls due which is within 12 months of signing these accounts. Although the Directors would be confident of gaining a further extension of time until such a sale was completed. The directors have confirmed that the going concern basis remains appropriate as the asset will be realised and all liabilities will be repaid in full.
Inventories are stated at the lower of cost and estimated selling price less cost to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and overheads that have been incurred in bringing the inventories to their present location and condition.
Inventories held for distribution at no or nominal consideration are measured at the lower of replacement cost and cost, adjusted where applicable for any loss of service potential. Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
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VAGA DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
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VAGA DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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VAGA DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
The Company's immediate parent is All Saints Living Limited.
The Company's ultimate parent during the period was High Street GRP Limited. High Street GRP Limited is incorporated in the UK. Following a sale agreement in August 2021 the immediate parent has remained the same, however the ultimate parent is now Hadrian Real Estate plc.
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