Alma Care Homes Holywell Limited Group accounts (Group and Company)

Alma Care Homes Holywell Limited Group accounts (Group and Company)

ALMA CARE HOMES HOLYWELL LIMITED - Company Information

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COMPANY REGISTRATION NUMBER: 10874579
Alma Care Homes Holywell Limited
Consolidated Financial Statements
30 September 2020
Alma Care Homes Holywell Limited
Consolidated Financial Statements
Year Ended 30 September 2020
Contents
Page
Officers and professional advisers
1
Strategic report
2
Directors' report
4
Independent auditor's report to the members
6
Consolidated statement of comprehensive income
9
Consolidated statement of financial position
10
Company statement of financial position
11
Consolidated statement of changes in equity
12
Company statement of changes in equity
13
Consolidated statement of cash flows
14
Notes to the consolidated financial statements
15
Alma Care Homes Holywell Limited
Officers and Professional Advisers
The board of directors
Mr G J Reid (Resigned 18 March 2020)
Mr M J Whitehead (Resigned 18 March 2020)
Mr W Schapira
Mr N Schapira (Appointed 27 February 2020)
Registered office
91-97 Saltergate
Chesterfield
England
S40 1LA
Auditor
MCABA Limited t/a Mitchells
Chartered Accountants & Statutory Auditor
91-97 Saltergate
Chesterfield
Derbyshire
S40 1LA
Bankers
Barclays Bank plc
1 Churchill Place
London
E14 5HP
Solicitors
Windles Solicitors Limited
Moorstone Cottage
Over Road
Baslow
Bakewell
Derbyshire
England
DE45 1PL
Allen & Overy LLP
One Bishops Square
London
England
E1 6AD
Alma Care Homes Holywell Limited
Strategic Report
Year Ended 30 September 2020
The directors present their strategic report on the group for the year ended 30 September 2020. Review of the business The principal activity of the company is that of a holding company. The principal activity of the group during the year was that of operating care homes for elderly residents. The company owns a 100% subsidiary - Holywell Park Holdings Limited, which in turn has a 100% subsidiary - Holywell Park Limited. Results and performance The results of the group for the year, as set out on pages 9 to 11, show a loss on ordinary activities before taxation and exceptional costs of £209,976 (2019: £187,086 loss). The shareholder funds are at a surplus of £1,251,305 (2019: £1,685,595). The main reason for the loss in the year is the increase in staff costs as opposed to fees. A typical industry measure of performance is the EBITDA (excluding exceptional items) which was £293,978 (2019: £333,673). The group have been adversely impacted by the COVID -19 pandemic which from a financial point of view has led to an increased cost to maintain a high quality of care for our residents. This has led to a fall in profit for the year. Key performance indicators The directors monitor the progress of the group by reference to key performance indicators. The key performance indicators for the group are those that communicate the financial performance and strength of the group as a whole, being turnover, gross profit margin and wages as a proportion of fees. The gross profit margin for the group is healthy at 25.2% (2019: 34.1%), with a gross profit of £713,239 (2019: £966,751). Wages as a proportion of fees were 70.2% (2019: 61.5%) which is above industry benchmarks. The fall in the gross profit margin and rise in wages as a proportion to fees is due to the impact of the COVID-19 pandemic. This has caused staff costs to considerably increase during the year. Principal risks and uncertainties The senior management team meet regularly to consider the risks that face the group and how established processes and controls are used to manage these risks. Key risks and uncertainties are outlined below: Legislative and regulatory risk The current principal risks and uncertainties to the ongoing performance of the Group is the reputation with Care Quality Commission (CQC) and local authorities. Currently, Alma Care Homes Holywell Limited through its subsidiaries Holywell Park Holdings Limited and Holywell Park Limited has good relationships with these and Holywell Park was rated as "good" in its latest CQC inspection relating to the standard of care provided. The group hopes to build on this going forward. Market risk The market is currently under pressure regarding costs and quality standards. The group regularly monitors quality standards in all of its homes and produces detailed interim financial information which enables them to react quickly to any issues. Financial risks The group has strengthened its financial reporting systems after the year end. They produce monthly management information reports at a company and consolidated group level, together with a rolling 13 week cash flow forecast and longer term forecast. The company and group monitor actual performance against forecast and plan for shortfalls in cash reserves. The bank loan in the company is part of a wider group bank loan facility. All companies within the group are bound together by this facility and hence when reviewing Financial Risks it is necessary to review the wider group. The group are in regular contact with Barclays Bank Plc as noted in the below going concern paragraph. COVID-19 pandemic COVID-19 began to impact the group part way through the year, and continues to effect the group post year end. The directors and management acted promptly at the outset of the pandemic, and have realigned their strategy and working practices to meet the demands arising from the ever-changing environment. They continue to adapt in response to further changes. Procedures were put in place to protect residents and staff, ensure the group had adequate access to supplies of personal protective equipment, monitor costs and protect cash flow as far as possible. These procedures, along with further contingency plans, are intended to enable the group to continue as a going concern. However they have adversely impacted profit in the year. Labour and recruitment There is no specific impact of Brexit from a customer perspective. However, as there is already a shortage of labour in the care industry, any barriers to employing EU Care staff are likely to make competition for employment more intense. The group remains proactive in its ability to recruit and retain high quality staff. Minimum wage increases and auto-enrolment contributions continue to impact the group moving forward. Going concern The group bank loan facility with Barclays Bank Plc is part of a wider group bank loan facility. The wider group has been adversely impacted by the COVID-19 pandemic which from a financial point of view, has led to an increased cost to maintain a high quality of care to our residents. One of the key financial impacts has been the wider group breaching its bank financial covenants. In 2021 the business initiated a financial review with the group's bankers (Barclays Bank Plc). The group expects the review to be completed by the end of the first quarter of 2022. The directors are confident that there will be a satisfactory outcome to meet the financial needs of the businesses. The directors acknowledge both the ongoing bank independent financial review and continued impact of COVID-19 on group performance may cast significant doubt on the company and groups ability to continue as a going concern. The group are working with Barclays Bank Plc during the financial review and have implemented robust operational and financial improvements across the group. The directors are also optimistic that the detrimental impact of COVID-19 on group performance will begin to ease. They are confident that this will enable the wider group to meet financial covenants soon and hence continue to adopt the going concern basis in preparing the accounts.
This report was approved by the board of directors on 22 February 2022 and signed on behalf of the board by:
Mr W Schapira
Director
Alma Care Homes Holywell Limited
Directors' Report
Year Ended 30 September 2020
The directors present their report and the consolidated financial statements of the group for the year ended 30 September 2020 .
Directors
The directors who served the company during the year were as follows:
Mr W Schapira
Mr N Schapira
(Appointed 27 February 2020)
Mr G J Reid
(Resigned 18 March 2020)
Mr M J Whitehead
(Resigned 18 March 2020)
Dividends
The directors do not recommend the payment of a dividend.
Future developments
As highlighted in the strategic report the group is part of a wider group bank loan facility. The detrimental impact of COVID-19 on group performance has caused a breach in financial covenants.
In 2021 the business initiated a financial review with the group's bankers (Barclays Bank Plc).
The group expects the review to be completed by the end of the first quarter of 2022. The directors are confident that there will be a satisfactory outcome to meet the financial needs of the businesses.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' report and the consolidated financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare consolidated financial statements for each financial year. Under that law the directors have elected to prepare the consolidated financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the consolidated financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the company and the profit or loss of the group for that period. In preparing these consolidated financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent. 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 enable them to ensure that the consolidated 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. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the group and the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the group and the company's auditor is aware of that information.
This report was approved by the board of directors on 22 February 2022 and signed on behalf of the board by:
Mr W Schapira
Director
Alma Care Homes Holywell Limited
Independent Auditor's Report to the Members of Alma Care Homes Holywell Limited
Year Ended 30 September 2020
Opinion
We have audited the consolidated financial statements of Alma Care Homes Holywell Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2020 which comprise the consolidated statement of comprehensive income, consolidated statement of financial position, company statement of financial position, consolidated statement of changes in equity, company statement of changes in equity, consolidated statement of cash flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the consolidated financial statements: - give a true and fair view of the state of the group's and of the parent company's affairs as at 30 September 2020 and of the group's loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
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 auditor's responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in the UK, including the FRC’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.
Material uncertainty related to going concern
We draw attention to note 3 in the financial statements which indicates that the group has been significantly impacted by the Covid-19 pandemic which has contributed to an ongoing breach of the groups bank financial covenants. Barclays Bank PLC are in the process of carrying out a financial review on the group. This combined with other factors highlighted in note 3 indicate that a material uncertainty exists which may cast significant doubt on the company and the groups ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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 responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Key audit matters
Except for the matter described in the Material uncertainty related to going concern section, we have determined that there are no other key audit matters to be communicated in our report.
Other information
The other information comprises the information included in the annual report, other than the consolidated financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the consolidated 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. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in 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 there is a material misstatement in the consolidated financial statements or a material misstatement of the other information. 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. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report for the financial year for which the consolidated financial statements are prepared is consistent with the consolidated financial statements; and
- the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. 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: - adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or - the parent company consolidated financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the consolidated financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the consolidated financial statements
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 auditor’s report that includes my 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 in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at https: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our 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 auditor's 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.
Tony Hornsby BA (Hons) FCA
(Senior Statutory Auditor)
For and on behalf of
MCABA Limited t/a Mitchells
Chartered Accountants & Statutory Auditor
91-97 Saltergate
Chesterfield
Derbyshire
S40 1LA
22 February 2022
Alma Care Homes Holywell Limited
Consolidated Statement of Comprehensive Income
Year Ended 30 September 2020
2020
2019
Note
£
£
Turnover
4
2,833,038
2,836,759
Cost of sales
( 2,119,799)
( 1,870,008)
------------
------------
Gross Profit
713,239
966,751
Administrative expenses
( 912,164)
( 1,047,138)
Other operating income
5
82,596
–
---------
------------
Operating Loss
6
( 116,329)
( 80,387)
Exceptional items
( 227,003)
–
Other interest receivable and similar income
10
( 24)
–
Interest payable and similar expenses
11
( 93,623)
( 106,699)
---------
------------
Loss Before Taxation
( 436,979)
( 187,086)
Tax on loss
12
2,689
100,216
---------
---------
Loss for the Financial Year and Total Comprehensive Income
( 434,290)
( 86,870)
---------
---------
All the activities of the group are from continuing operations.
Alma Care Homes Holywell Limited
Consolidated Statement of Financial Position
30 September 2020
2020
2019
Note
£
£
Fixed Assets
Intangible assets
13
2,568,725
2,940,107
Tangible assets
14
1,429,324
1,460,669
------------
------------
3,998,049
4,400,776
Current Assets
Stocks
16
4,175
4,175
Debtors
17
920,390
1,222,154
Cash at bank and in hand
224,755
61,561
------------
------------
1,149,320
1,287,890
Creditors: amounts falling due within one year
19
669,872
742,186
------------
------------
Net Current Assets
479,448
545,704
------------
------------
Total Assets Less Current Liabilities
4,477,497
4,946,480
Creditors: amounts falling due after more than one year
20
3,201,204
3,233,208
Provisions
21
24,988
27,677
------------
------------
Net Assets
1,251,305
1,685,595
------------
------------
Capital and Reserves
Called up share capital
25
1
1
Share premium account
26
1,744,999
1,744,999
Profit and loss account
26
( 493,695)
( 59,405)
------------
------------
Shareholders Funds
1,251,305
1,685,595
------------
------------
These consolidated financial statements were approved by the board of directors and authorised for issue on 22 February 2022 , and are signed on behalf of the board by:
Mr W Schapira
Director
Company registration number: 10874579
Alma Care Homes Holywell Limited
Company Statement of Financial Position
30 September 2020
2020
2019
Note
£
£
Fixed Assets
Investments
15
3,458,833
3,458,833
Current Assets
Debtors
17
534,144
3,459,535
Cash at bank and in hand
341
1,154
---------
------------
534,485
3,460,689
Creditors: amounts falling due within one year
19
102,770
2,340,928
---------
------------
Net Current Assets
431,715
1,119,761
------------
------------
Total Assets Less Current Liabilities
3,890,548
4,578,594
Creditors: amounts falling due after more than one year
20
3,201,204
3,221,211
------------
------------
Net Assets
689,344
1,357,383
------------
------------
Capital and Reserves
Called up share capital
25
1
1
Share premium account
26
1,744,999
1,744,999
Profit and loss account
26
( 1,055,656)
( 387,617)
------------
------------
Shareholders Funds
689,344
1,357,383
------------
------------
The loss for the financial year of the parent company was £ 668,039 (2019: £ 129,995 ).
These consolidated financial statements were approved by the board of directors and authorised for issue on 22 February 2022 , and are signed on behalf of the board by:
Mr W Schapira
Director
Company registration number: 10874579
Alma Care Homes Holywell Limited
Consolidated Statement of Changes in Equity
Year Ended 30 September 2020
Called up share capital
Share premium account
Profit and loss account
Total
£
£
£
£
At 1 October 2018
1
1,744,999
27,465
1,772,465
Loss for the year
( 86,870)
( 86,870)
----
------------
--------
------------
Total Comprehensive Income for the Year
–
–
( 86,870)
( 86,870)
At 30 September 2019
1
1,744,999
( 59,405)
1,685,595
Loss for the year
( 434,290)
( 434,290)
----
------------
---------
------------
Total Comprehensive Income for the Year
–
–
( 434,290)
( 434,290)
----
------------
---------
------------
At 30 September 2020
1
1,744,999
( 493,695)
1,251,305
----
------------
---------
------------
Alma Care Homes Holywell Limited
Company Statement of Changes in Equity
Year Ended 30 September 2020
Called up share capital
Share premium account
Profit and loss account
Total
£
£
£
£
At 1 October 2018
1
1,744,999
( 257,622)
1,487,378
Loss for the year
( 129,995)
( 129,995)
----
------------
---------
------------
Total Comprehensive Income for the Year
–
–
( 129,995)
( 129,995)
At 30 September 2019
1
1,744,999
( 387,617)
1,357,383
Loss for the year
( 668,039)
( 668,039)
----
------------
---------
------------
Total Comprehensive Income for the Year
–
–
( 668,039)
( 668,039)
----
------------
------------
------------
At 30 September 2020
1
1,744,999
( 1,055,656)
689,344
----
------------
------------
------------
Alma Care Homes Holywell Limited
Consolidated Statement of Cash Flows
Year Ended 30 September 2020
2020
2019
Note
£
£
Cash Flows from Operating Activities
Loss for the financial year
( 434,290)
( 86,870)
Adjustments for:
Depreciation of tangible assets
38,925
42,678
Amortisation of intangible assets
371,382
371,382
Other interest receivable and similar income
35
–
Interest payable and similar expenses
93,612
106,699
Tax on loss
( 2,689)
( 100,216)
Changes in:
Trade and other debtors
( 56,509)
121,269
Trade and other creditors
249,086
50,309
---------
---------
Cash generated from operations
259,552
505,251
Interest paid
( 93,612)
( 106,699)
Interest received
( 35)
–
Tax paid
–
( 14,550)
---------
---------
Net cash from operating activities
165,905
384,002
---------
---------
Cash Flows from Investing Activities
Purchase of tangible assets
( 7,580)
( 1,327)
---------
---------
Net cash used in investing activities
( 7,580)
( 1,327)
---------
---------
Cash Flows from Financing Activities
Repayments of borrowings
( 62,026)
( 105,362)
Proceeds from loans from group undertakings
214,914
53,717
Repayments of loans from group undertakings
( 146,465)
( 316,502)
---------
---------
Net cash from/(used in) financing activities
6,423
( 368,147)
---------
---------
Net Increase in Cash and Cash Equivalents
164,748
14,528
Cash and Cash Equivalents at Beginning of Year
60,007
45,479
---------
--------
Cash and Cash Equivalents at End of Year
18
224,755
60,007
---------
--------
Alma Care Homes Holywell Limited
Notes to the Consolidated Financial Statements
Year Ended 30 September 2020
1. General information
The company is a private company limited by shares, registered in England. The address of the registered office is 91-97 Saltergate, Chesterfield, England, S40 1LA. The companys' trading address is Hodsoll Street, New Ash Green, Longfield, TN15 7LE.
2. Statement of compliance
These consolidated financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis. The financial statements are prepared in sterling, which is the functional currency of the entity.
Going concern
The directors review the financial information for the company and group considering whether they are a going concern for a period of at least 12 months from the date of approval of the accounts. The company is part of a wider group bank loan facility with Barclays Bank Plc. The company and wider group have been significantly impacted by increased costs as a result of the COVID-19 pandemic, which has contributed to an ongoing breach of its group bank financial covenants. Barclays Bank Plc are in the process of carrying out a financial review on the wider group. The results of this review are unknown at present. The directors acknowledge both the ongoing bank independent financial review and continued impact of COVID-19 on group performance may cast significant doubt on the company and groups ability to continue as a going concern. The group are working with Barclays Bank Plc during the financial review and have implemented robust operational and financial improvements across the group. The directors are also optimistic that the detrimental impact of COVID-19 on group performance will begin to ease. They are confident that this will enable the wider group to meet financial covenants soon and hence continue to adopt the going concern basis in preparing the accounts.
Disclosure exemptions
The parent company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following reduced disclosures available under FRS 102: (a) No cash flow statement has been presented for the company.
Consolidation
The consolidated financial statements consolidate the consolidated financial statements of Alma Care Homes Holywell Limited and all of its subsidiary undertakings.
The results of subsidiaries acquired or disposed of during the year are included from or to the date that control passes.
The parent company has applied the exemption contained in section 408 of the Companies Act 2006 and has not presented its individual profit and loss account.
Judgements and key sources of estimation uncertainty
In the process of applying the group's accounting policies, the directors are required to make certain estimates, judgements and assumptions that they believe are reasonable based upon the information available. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the periods presented. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, and the impact of COVID-19. Actual results may differ from the estimates, the effect of which is recognised in the period in which the facts that give rise to the revision become known. The estimate and assumptions that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows: Useful life and residual values Intangible assets The charge is respect of amortisation is derived after determining an estimate of the useful life of goodwill arising on business combinations. This estimate is based on a variety of factors such as expected use of the acquired business, the expected useful life of the cash generating unit to which the goodwill is attributed, any legal, regulatory or contractual provisions that can limit the useful life and assumptions that market participants would consider in respect of similar businesses. Tangible assets The charge in respect of depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful lives and residual values of the company's assets may vary depending on several factors such as, technological innovation, maintenance programmes and future market conditions. They are determined by management at the time the asset is acquired and reviewed annually for appropriateness. Leases Determining whether leases entered into by the group as a lessee are operating or finance leases requires judgement. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee based on the evaluation of the terms and conditions of the arrangements on a lease by lease basis. Recoverability of trade debtors The directors make provisions for doubtful debts based on an assessment of the recoverability of trade debtors. Provisions are applied to trade debtors where events or changes in circumstances indicate that the carrying amounts may not be recoverable. This methodology is applied on a customer by customer basis.
Revenue recognition
The turnover shown in the profit and loss account represents residents fees earned during the accounting period.
Exceptional items
Exceptional items are material and non-recurring items. These are disclosed separately on the face of the income statement to reflect performance in a consistent manner, in line with how the business is managed and measured on a day-to-day basis.
Income tax
Current tax represents the amount of tax payable or receivable in respect of the taxable profit (or loss) for the current or past reporting periods. It is measured at the amount expected to be paid or recovered using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more tax. Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis.
Goodwill
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill
-
10% straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Freehold property
-
1% straight line
Plant and machinery
-
15% reducing balance
Fixtures and fittings
-
15% reducing balance
Investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.
Stocks
Stocks are measured at the lower of cost and net realisable value.
Government grants
Government and local authority grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model.
Financial instruments
Debtors and creditors with no stated interest rate and receivable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided.
4. Turnover
Turnover arises from:
2020
2019
£
£
Residents' fees
2,833,038
2,836,759
------------
------------
The whole of the turnover is attributable to the principal activity of the group wholly undertaken in the United Kingdom.
5. Other operating income
2020
2019
£
£
Government grant income
78,756
–
Other operating income
3,840
–
--------
----
82,596
–
--------
----
6. Operating profit
Operating profit or loss is stated after charging:
2020
2019
£
£
Amortisation of intangible assets
371,382
371,382
Depreciation of tangible assets
38,925
42,678
Impairment of trade debtors
1,758
35,875
---------
---------
7. Auditor's remuneration
2020
2019
£
£
Fees payable for the audit of the consolidated financial statements
9,780
8,500
-------
-------
8. Staff costs
The average number of persons employed by the group during the year, including the directors, amounted to:
2020
2019
No.
No.
Nursing and management staff
99
94
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2020
2019
£
£
Wages and salaries
1,786,722
1,477,334
Social security costs
131,835
102,916
Other pension costs
27,311
20,267
------------
------------
1,945,868
1,600,517
------------
------------
9. Exceptional items
Group
Company
2020
2019
2020
2019
£
£
£
£
Write off of group balances
225,081
–
546,139
–
---------
----
---------
----
Group Included in exceptional items is a debit of £225,081 (2019: £nil) relating to the write off of balances with entities within the UK Alma Group companies. Company Included in exceptional items is a debit of £546,139 (2019: £nil) relating to the write off of balances with entities within the UK Alma Group companies.
10. Other interest receivable and similar income
2020
2019
£
£
Overpaid corporation tax interest
( 24)
–
----
----
11. Interest payable and similar expenses
2020
2019
£
£
Interest on banks loans and overdrafts
93,612
106,148
Other interest payable and similar charges
11
551
--------
---------
93,623
106,699
--------
---------
12. Tax on loss
Major components of tax income
2020
2019
£
£
Current tax:
Adjustments in respect of prior periods
–
( 95,694)
Deferred tax:
Origination and reversal of timing differences
( 2,689)
( 4,522)
-------
---------
Tax on loss
( 2,689)
( 100,216)
-------
---------
Reconciliation of tax income
The tax assessed on the loss on ordinary activities for the year is higher than (2019: lower than) the standard rate of corporation tax in the UK of 19 % (2019: 19 %).
2020
2019
£
£
Loss on ordinary activities before taxation
( 436,979)
( 187,086)
---------
---------
Loss on ordinary activities by rate of tax
( 83,026)
( 19,818)
Adjustment to tax charge in respect of prior periods
–
( 95,694)
Effect of expenses not deductible for tax purposes
113,424
70,706
Effect of capital allowances and depreciation
5,648
7,481
Deferred tax movement
( 2,689)
( 4,522)
Group relief
( 36,046)
( 58,369)
---------
---------
Tax on loss
( 2,689)
( 100,216)
---------
---------
13. Intangible assets
Group
Goodwill
£
Cost
At 1 October 2019 and 30 September 2020
3,713,819
------------
Amortisation
At 1 October 2019
773,712
Charge for the year
371,382
------------
At 30 September 2020
1,145,094
------------
Carrying amount
At 30 September 2020
2,568,725
------------
At 30 September 2019
2,940,107
------------
The company has no intangible assets.
14. Tangible assets
Group
Freehold property
Plant and machinery
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 October 2019
1,338,302
80,822
132,905
1,552,029
Additions
–
954
6,626
7,580
------------
--------
---------
------------
At 30 September 2020
1,338,302
81,776
139,531
1,559,609
------------
--------
---------
------------
Depreciation
At 1 October 2019
34,300
22,487
34,573
91,360
Charge for the year
15,574
8,798
14,553
38,925
------------
--------
---------
------------
At 30 September 2020
49,874
31,285
49,126
130,285
------------
--------
---------
------------
Carrying amount
At 30 September 2020
1,288,428
50,491
90,405
1,429,324
------------
--------
---------
------------
At 30 September 2019
1,304,002
58,335
98,332
1,460,669
------------
--------
---------
------------
The company has no tangible assets.
15. Investments
The group has no investments.
Company
Shares in group undertakings
£
Cost
At 1 October 2019 and 30 September 2020
3,458,833
------------
Impairment
At 1 October 2019 and 30 September 2020
–
------------
Carrying amount
At 1 October 2019 and 30 September 2020
3,458,833
------------
At 30 September 2019
3,458,833
------------
Subsidiaries
Details of the investments in which the parent company has an interest of 20% or more are as follows:
Registered office
Class of share
Percentage of shares held
Subsidiary undertakings
Holywell Park Holdings Limited
91-97 Saltergate
Ordinary
100
Chesterfield
England
S40 1LA
Holywell Park Limited
91-97 Saltergate
Ordinary
100
Chesterfield
England
S40 1LA
16. Stocks
Group
Company
2020
2019
2020
2019
£
£
£
£
Raw materials and consumables
4,175
4,175
–
–
-------
-------
----
----
17. Debtors
Group
Company
2020
2019
2020
2019
£
£
£
£
Trade debtors
177,826
99,640
–
–
Amounts owed by group undertakings
720,175
1,064,301
534,144
3,429,071
Prepayments and accrued income
9,709
45,017
–
27,941
Other debtors
12,680
13,196
–
2,523
---------
------------
---------
------------
920,390
1,222,154
534,144
3,459,535
---------
------------
---------
------------
The debtors above include the following amounts falling due after more than one year:
Group
Company
2020
2019
2020
2019
£
£
£
£
Amounts owed by group undertakings
–
92,619
–
3,112,181
----
--------
----
------------
18. Cash and cash equivalents
Cash and cash equivalents comprise the following:
2020
2019
£
£
Cash at bank and in hand
224,755
61,561
Bank overdrafts
–
( 1,554)
---------
--------
224,755
60,007
---------
--------
19. Creditors: amounts falling due within one year
Group
Company
2020
2019
2020
2019
£
£
£
£
Bank loans and overdrafts
89,748
133,321
89,748
133,321
Trade creditors
121,425
86,813
–
–
Amounts owed to group undertakings
–
263,679
–
2,194,036
Accruals and deferred income
118,778
56,329
13,022
12,971
Corporation tax
22,960
22,960
–
–
Social security and other taxes
170,289
53,340
–
–
Other creditors
146,672
125,744
–
600
---------
---------
---------
------------
669,872
742,186
102,770
2,340,928
---------
---------
---------
------------
20. Creditors: amounts falling due after more than one year
Group
Company
2020
2019
2020
2019
£
£
£
£
Bank loans and overdrafts
3,201,204
3,221,211
3,201,204
3,221,211
Amounts owed to group undertakings
–
11,997
–
–
------------
------------
------------
------------
3,201,204
3,233,208
3,201,204
3,221,211
------------
------------
------------
------------
Included within creditors: amounts falling due after more than one year is an amount of £2,648,417 (2019: £2,648,417) for the group and £2,648,417 (2019: £2,648,417) for the company in respect of liabilities payable or repayable by instalments which fall due for payment after more than five years from the reporting date.
Interest of 2.25% above LIBOR is charged on the loan, on which Barclays Bank PLC have a fixed and floating charge over all of the property and undertaking of entity and the wider group.
The group has entered into an unlimited guarantee for bank loans made available to group companies. It is not anticipated that any material liabilities will arise from the contingent liabilities other than those provided for in these financial statements.
The group treats guarantees and indemnities of this nature as contingent liabilities until such time as it becomes probable that the group will be required to make a payment under the terms of the arrangement.
As at 30 September 2020 the value of the group wide bank borrowings amounted to £16.4million (2019: £16.5million).
21. Provisions
Group
Deferred tax (note 22)
£
At 1 October 2019
27,677
Charge against provision
( 2,689)
--------
At 30 September 2020
24,988
--------
The company does not have any provisions.
22. Deferred tax
The deferred tax included in the statement of financial position is as follows:
Group
Company
2020
2019
2020
2019
£
£
£
£
Included in provisions (note 21)
24,988
27,677
–
–
--------
--------
----
----
The deferred tax account consists of the tax effect of timing differences in respect of:
Group
Company
2020
2019
2020
2019
£
£
£
£
Accelerated capital allowances
24,988
27,677
–
–
--------
--------
----
----
23. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 27,311 (2019: £ 20,267 ).
24. Government grants
The amounts recognised in the consolidated financial statements for government grants are as follows:
Group
Company
2020
2019
2020
2019
£
£
£
£
Recognised in other operating income:
Government grants recognised directly in income
78,756
–
–
–
--------
----
----
----
25. Called up share capital
Issued, called up and fully paid
2020
2019
No.
£
No.
£
Ordinary shares of £ 1 each
1
1
1
1
----
----
----
----
26. Reserves
Share premium account - This reserve records the amount above the nominal value received for shares sold, less transaction costs . Profit and loss account - This reserve records retained earnings and accumulated losses.
27. Analysis of changes in net debt
At 1 Oct 2019
Cash flows
At 30 Sep 2020
£
£
£
Cash at bank and in hand
61,561
163,194
224,755
Bank overdrafts
(1,554)
1,554
–
Debt due within one year
(395,446)
305,698
(89,748)
Debt due after one year
(3,233,208)
32,004
(3,201,204)
------------
---------
------------
( 3,568,647)
502,450
( 3,066,197)
------------
---------
------------
28. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
Group
Company
2020
2019
2020
2019
£
£
£
£
Not later than 1 year
18,939
18,051
–
–
Later than 1 year and not later than 5 years
63,497
66,016
–
–
Later than 5 years
11,448
25,186
–
–
--------
---------
----
----
93,884
109,253
–
–
--------
---------
----
----
29. Related party transactions
Group
Key management personnel include all persons that have authority and responsibility for planning, directing and controlling the activities of the company. The total compensation paid to key management personnel for services provided to the group was £ 41,192 (2019: £ 85,356 ).
Alma Care Homes Holywell Limited
Notes to the Consolidated Financial Statements (continued)
Year Ended 30 September 2020
29. Related party transactions (continued)
Company
The company has taken advantage of the exemption conferred by FRS 102 S33.1A, removing the requirement to disclose transactions between group companies. During the year the company provided and received loans from group companies and related parties. The total balances outstanding due (to)/from these entities at 30 September 2020 are as follows:
2020 2019
£ £
Amounts due from entities owning a participating interest 534,144 534,144
Amounts due from entities own a participating interest - 2,851,826
Amounts due from entities under common control - 43,101
Amounts due to entities owning a participating interest - (216,349)
Amounts due to entities own a participating interest - (1,976,884)
Amounts due to entities under common control - (803)
Included within the above, the following amounts are due in over one year. Interest of 3% per annum is charged on these balances.
2020 2019
£ £
Amounts due from entities under common control - 43,101
The remaining balances with entities are unsecured, interest free and repayable on demand. Group The group has taken advantage of the exemption conferred by FRS 102 S33.1A, removing the requirement to disclose transactions between group companies. During the year the group provided and received loans from group companies and related parties. The total balances outstanding due (to)/from these entities at 30 September 2020 are as follows:
2020 2019
£ £
Amounts due from entities holding a participating interest 534,144 582,775
Amounts due from entities under common control 15,001 319,995
Amounts due from entities under control of directors 171,030 161,530
Amounts due to entities holding a participating interest - (34,927)
Amounts due to entities under common control - (240,748)
Within amounts due from entities under common control, £nil (2019: £92,619) is due in over one year. Within amounts owed to entities under common control, £nil (2019: £11,997) is due in over one year. The remaining balances with entities are unsecured, interest free and repayable on demand.
30. Controlling party
Alma Care Homes Holywell Limited is the 100% subsidiary of Great Nursing Homes Holding S.á r.l.. A company incorporated in Luxembourg. The ultimate parent company is Princess Wilru S.á r.l., a company incorporated in Luxembourg. The directors consider Princess Wilru S.á r.l. to be the ultimate controlling party. Princess Wilru S.á r.l. is registered with the Luxembourg Register of Commerce and Companies under number B 118.903. It's registered office is 2a, rue des Capucins, L-1313 Luxembourg, Grand Duchy of Luxembourg.