LONDON_INN_HOTELS_(_STRAT - Accounts

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

For the financial year ended 30 April 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The member has not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

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

London Inn Hotels ( Stratford ) Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 36 Railway Approach, Station Road, Harrow, Middlesex, HA3 5AA.

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 £.

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

These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Revenue is derived from hotel operations, including the rental of rooms, food and beverage sales. Revenue is recognised when rooms are occupied and food and beverages are sold. Turnover is measured at the fair value of the consideration received, excluding discounts, rebates, value added tax and other sales taxes.

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 on the following bases:

Freehold land is not depreciated

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

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.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value , which is normally the transaction price. Such assets are subsequently carried at fair value and the charges in fair value are recognised in profit and loss, except that investments in equity instruments that are not publically traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

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.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

Government grants, which include amounts received under the Coronavirus Job Retention Scheme and amounts received from local authority 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. For the Coronavirus Job Retention scheme the income is recognised in other income on a systematic basis over the periods in which the associated costs are incurred, using the accrual model. For local authority grants the income is recognised in other income in the period in which the grant becomes receivable.

Rates holiday

Business rates holidays received are set off against the applicable rate expense and recognised over the period in which the associated costs relate to.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

The company carries its property, used in the business, at fair value. It has a carrying amount at the balance sheet date of £32,121,532. It was revalued in October 2018 by independent valuers and was reflected in the financial statements at 30 April 2018. The valuation was based on an estimate of the maintainable level of trade and future profitability a component operator of a business conducted on the premises acting in an efficient manner would expect to achieve. As with all properties valued by reference to trading potential, valuations are vulnerable to external influences and the introduction of competition. The trading valuation is inextricably linked to the performance of the national economy.

As at 30 April 2022 the directors believe that the fair value of the land and buildings, after the additions and depreciation charge for the year, materially reflects the market value at the balance sheet date. There are uncertainties as a result of the pandemic and further resulting lockdowns impacting on post balance sheet trading. It is anticipated that these uncertainties would be reflected in any professional valuation carried out.

Deferred tax has been recognised on revalued property based on the estimated fair value at the year-end date.

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

Land and building with a carrying amount of £32,121,532 were revalued in October 2018 by an independent valuers, which was reflected in the financial statements at 30 April 2018. The valuations are based on an estimate of the maintainable level of trade and future profitability a component operator of a business conducted on the premises acting in an efficient manner would expect to achieve. As with all properties valued by reference to trading potential, valuations are vulnerable to external influences and the introduction of competition. The trading valuation is inextricably linked to the performance of the national economy.

As at 30 April 2022 the directors believe that the fair value of the land and buildings, after the additions and depreciation charge for the year, materially reflects the market value at the balance sheet date. There are uncertainties as a result of the pandemic and further resulting in lockdowns impacting on post balance sheet trading. it is anticipated that these uncertainties would be reflected in any professional valuation carried out.

All other tangible fixed assets are stated at historical costs.

Land and buildings are carried at valuation. if land and building were measured using the cost model, the carrying amounts would have been approximately £6,820,369 (2021: £6,969,580), being costs of £8,406,234 (2021: £8,406,234) and an accumulated depreciation of £1,585,865 (2021: £1,436,654).

The bank loans are secured by fixed floating charge over all the assets, which include all present and future freehold and leasehold property, book and other debt, chattels, goodwill and uncalled up capital, both present and future.

The company forms part of a cross company guarantee securing the bank borrowings of London Inn Hotels (Stratford) Limited and TLC (Radlett) Limited. At 30 April 2022 the net borrowings of these companies amounted to £1,094,708 (2021: £1,147,639).

The company has also given a cross company guarantee to The Fellows House Limited, which is a company owned by P Popat, a director of the company, securing the bank borrowings. At 30 April 2022 the net borrowings of these companies amounted to £28,662,858 (2021: £27,156,824).

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

During the year, the company was charged rent of £48,000 (2021: £48,000) for the use of a property owned by S D Popat, ultimate shareholder of the company and her husband D A Popat, A lease exists between S D Popat, D A Popat and the company for a period of 20 years from 1 September 2006.

During the year the company paid a salary of £15,000 (2021: £15,000) to D A Popat, the husband of the ultimate shareholder. Included within other debtors are the following balances:

• An amount of £2,123,913 (2021: £2,089,242) due from The Fellows House Limited which is a company owned by P Popat, a director of the company. The balance has arisen as a result of the company making interest free loans and paying expenses on behalf of The Fellows House Limited.

• An amount of £107,247 (2021: £79,500) due from SPK Bushey Ltd which is a company owned by P Popat, a director of the company. The balance has arisen as a result of the company making interest free loans to SPK Bushey Ltd.

• An amount of £4,788,636 (2021: £4,788,636) due from London Inn Hotels Cambridge Limited, a company controlled by P Popat. The balance has arisen as a result of interest free loans made to London Inn Hotels Cambridge Limited.

• An amount of £Nil (2021: £440,0000 due from HSP Residential Limited, a company under the control of S S Popat, a director if the company. The balance has arisen as a from loans made that are repayable within 5 years. The loan balance is currently not incurring interest.

• An amount of £4,404,503 (2021: £4,156,003) due from TLC Radlett Limited, a company under common control.

• An amount of £2,000 (2021: £2,000) due from TLC Construction Limited, a company under common control.

• An amount of £9,796 (2021: £Nil) due from Camberley Care Limited, a company under common control.

• An amount of £27 (2021: £Nil) due from Cooperscroft Care Home Limited, a company under common control.

• An amount of £3,714 (2021: £3,714) due from SPK Group Limited, a company under the control of P Popat, a director of the company.

• An amount of £81 (2021: £Nil) due from Karuna Manor Care Home Limited, a company under common control.

• An amount of £162 (2021: £Nil) due from Cambridge Manor Limited, a company under common control.

• An amount of £54 (2021: £Nil) due from Cherry Hinton Limited, a company under common control.

The immediate and ultimate controlling parent company is TLC Hospitality Group Limited, whose registerd office is 36 Railway Approach, Harrow, Middlesex, HA3 5AA.

The ultimate controlling party is S D Popat.