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Registered number: 02850465
U AND I (DEVELOPMENT AND TRADING) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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U AND I (DEVELOPMENT AND TRADING) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2022
Business review, principal activities and future developments
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U and I (Development and Trading) Limited's (the "Company") principal activities are that of property development and an investment holding company for a group of companies engaged in property development and trading. No changes to the Company's principal activities are anticipated in the foreseeable future.
The loss for the year ended 31 March 2022, after taxation, amounted to £3,154,313 (2021): £12,262,964).
The Directors do not recommend the payment of a dividend (2021: £Nil).
Principal risks and uncertainties
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The management of the business and the execution of the company's strategy are subject to a number of risks. As at 31 March 2022, the Company was a member of the Land Securities Group PLC group of companies. Further discussion of the risks and uncertainties, in the context of the group as a whole, is provided in Land Securities Group PLC's 2022 annual report which does not form part of this report.
Financial key performance indicators (KPIs)
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The directors of Land Securities Group PLC and its subsidiaries (‘the Group’) manage the Group’s operations on a group basis. For this reason, the Company’s Directors believe that an analysis using KPIs for the Company is not necessary or appropriate for an understanding of the development, performance or position of the business of the Company. The development, performance and position of the Group is discussed in the consolidated financial statements of Land Securities Group PLC, in which the entity is consolidated, and which does not form part of this report.
This report was approved by the board and signed by its order.
L McCaveny, for and on behalf of U and I Company Secretaries Limited
Company Secretary
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U AND I (DEVELOPMENT AND TRADING) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2022
The Directors present their report and the financial statements for the year ended 31 March 2022.
Directors' responsibilities statement
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The Directors are responsible for preparing the Strategic report, 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;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
∙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 Directors have determined that preparing the financial statements on the going concern basis is appropriate due to the continued financial support of the ultimate parent company, Land Securities Group PLC. The Directors' going concern assessment covers the period to 30 June 2024 and confirmation has been received that Land Securities Group PLC will support the Company until this date, so long as the Company remains a subsidiary of Land Securities Group PLC. If the Company was sold within the next 12 months from 30 June 2023, confirmation has been received that Land Securities Group PLC would ensure the Company remains in a position to continue as a going concern at the point of sale. The Company's ability to meet its future liabilities is therefore dependent on the financial performance, position and liquidity of the Group as a whole. At a Group level, considerations included potential risks and uncertainties in the business, credit, market, property valuation and liquidity risks, including the availability and repayment profile of bank facilities, as well as forecast covenant compliance. Stress testing has been carried out to ensure the Group has sufficient cash resources to continue in operation for the period to 30 June 2024. This stress testing modelled a scenario with materially reduced levels of cash receipts over the next 12 months. Based on these considerations, together with available market information and the Directors' knowledge and experience of the Company, the Directors continue to adopt the going concern basis in preparing the financial statements for the year ended 31 March 2022.
The loss for the year, after taxation, amounted to £3,154,313 (2021: loss £12,262,964).
The Directors do not recommend the payment of a dividend for the year ended 31 March 2022 (2021: £Nil)
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U AND I (DEVELOPMENT AND TRADING) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
The Directors who served during the year and up to the date of signing this report unless otherwise stated were:
J G Christmas (appointed 27 May 2021, resigned 31 March 2022)
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M J Hood (appointed 17 June 2021)
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M S Weiner (resigned 31 May 2021)
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M O Shepherd (resigned 19 June 2021)
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R Upton (resigned 30 April 2022)
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U and I Director 1 Limited (appointed 5 October 2022)
U and I Director 2 Limited (appointed 5 October 2022)
The Company has made qualifying third-party indemnity provisions for the benefit of the respective directors which were in place throughout the year and which remain in place at the date of this report.
Disclosure of information to auditor
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Each of the persons who are Directors at the time when this Directors' report is approved has confirmed that:
∙so far as the Director is aware, there is no relevant audit information of which the Company's auditor is unaware, and
∙the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
The auditor, Ernst & Young LLP, are deemed to be reappointed under section 487(2) of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
L McCaveny, for and on behalf of U and I Company Secretaries Limited
Company secretary
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF U AND I (DEVELOPMENT AND TRADING) LIMITED
Opinion
We have audited the financial statements of U and I (Development and Trading) Limited (the ‘Company’) for the year ended 31 March 2022 which comprise the Statement of Comprehensive Income, the Balance sheet, the Statement of Changes in Equity and the related notes 1 to 16, 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 financial statements:
∙give a true and fair view of the Company's affairs as at 31 March 2022 and of its loss for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
∙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 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 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.
Conclusions relating to 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.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern through the period to 30 June 2024.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company’s ability to continue as a going concern.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s 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 this report, we do not express any form of assurance conclusion thereon.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF U AND I (DEVELOPMENT AND TRADING) LIMITED (CONTINUED)
Other information (continued)
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 the 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 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.
Matters on which we are required to report by exception
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.
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, or 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; or
∙we have not received all the information and explanations we require for our audit; or
∙the Directors were not entitled to take advantage of the small companies exemptions in preparing the Directors’ Report and from the requirement to prepare a Strategic Report.
Responsibilities of the Directors
As explained more fully in the directors’ responsibilities statement set out on page 1, the Directors are responsible for the preparation of the 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 financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the 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 Company or to cease operations, or have no realistic alternative but to do so.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF U AND I (DEVELOPMENT AND TRADING) LIMITED (CONTINUED)
Auditor’s responsibilities for the audit of the 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 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.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
Our approach was as follows:
∙We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant which are directly relevant to specific assertions in the financial statements are those that relate to the reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax regulations in the United Kingdom, including the UK REIT regulations.
∙We understood how the Company is complying with those frameworks through enquiry with the Company and by identifying the Company's policies and procedures regarding compliance with laws and regulations. We also identified those members of the Company who have the primary responsibility for ensuring compliance with laws and regulations, and for reporting any known instances of non-compliance to those charged with governance.
∙We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by reviewing the Land Securities Group risk register and through enquiry with the Company's Management during the planning and execution phases of the audit. Where the risk was considered to be higher we performed audit procedures to address each identified fraud risk, specifically the risk over revenue recognition, including the timing of the revenue recognition and treatment of lease incentives and risk over impairment of investment in subsidiary undertakings and joint ventures, amount owed by group undertakings and trading properties.
∙Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved:
°Enquiry of Management, and when appropriate, those charged with governance of the Company regarding their knowledge of any non-compliance or potential non-compliance with laws and regulations that could affect the financial statements;
°Reading minutes of meetings of those charged with governance;
°Obtaining direct bank confirmations to vouch the existence of cash balances;
°Obtaining and reading correspondence from legal and regulatory bodies, including HMRC; and
°Journal entry testing, with a focus on manual journals and journals indicating large or unusual transactions based on our understanding the business
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF U AND I (DEVELOPMENT AND TRADING) LIMITED (CONTINUED)
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud (continued)
∙In addition, we completed procedures to conclude on the compliance of the disclosures in the financial statements with all applicable reporting requirements.
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.
Graeme Downes (Senior statutory auditor)
For and on behalf of
Ernst & Young LLP, Statutory Auditor
London
27 June 2023
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U AND I (DEVELOPMENT AND TRADING) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2022
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Provisions against intercompany loans
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Income from investment in subsidiaries
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Interest receivable and similar income
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(Loss)/gain on disposal of investments
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Loss and total comprehensive loss for the financial year
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There were no recognised gains and losses for 2022 or 2021 other than those included in the statement of comprehensive income.
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The notes on pages 11 to 23 form part of these financial statements.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
REGISTERED NUMBER: 02850465
BALANCE SHEET
AS AT 31 MARCH 2022
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Trade and other receivables: Due after one year
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Trade and other receivables: Due within one year
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Total assets less current liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
C Lund, for and on behalf of U and I Director 2 Limited
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The notes on pages 11 to 23 form part of these financial statements.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2022
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Comprehensive loss for the year
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Total comprehensive loss for the year
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Shares issued during the year
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Comprehensive loss for the year
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Total comprehensive loss for the year
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The notes on pages 11 to 23 form part of these financial statements.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
U and I (Development and Trading) Limited (the "Company") is a private limited company and is incorporated, domiciled and registered in England and Wales (Registered number: 02850465). The nature of the Company’s operations is set out in the Strategic Report on page 1. The address of its registered office is 100 Victoria Street, London, SW1E 5JL.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared on a going concern basis and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland ('FRS102') and the Companies Act 2006. The financial statements are prepared under the historical cost convention.
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Financial reporting standard 102 - reduced disclosure exemptions
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The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Land Securities PLC as at 31 March 2022 and these financial statements may be obtained from its registered office at 100 Victoria Street, London, SW1E 5JL.
The Directors have determined that preparing the financial statements on the going concern basis is appropriate due to the continued financial support of the ultimate parent company, Land Securities Group PLC. The Directors' going concern assessment covers the period to 30 June 2024 and confirmation has been received that Land Securities Group PLC will support the Company until this date, so long as the Company remains a subsidiary of Land Securities Group PLC. If the Company was sold within the next 12 months from 30 June 2023, confirmation has been received that Land Securities Group PLC would ensure the Company remains in a position to continue as a going concern at the point of sale. The Company's ability to meet its future liabilities is therefore dependent on the financial performance, position and liquidity of the Group as a whole. At a Group level, considerations included potential risks and uncertainties in the business, credit, market, property valuation and liquidity risks, including the availability and repayment profile of bank facilities, as well as forecast covenant compliance. Stress testing has been carried out to ensure the Group has sufficient cash resources to continue in operation for the period to 30 June 2024. This stress testing modelled a scenario with materially reduced levels of cash receipts over the next 12 months. Based on these considerations, together with available market information and the Directors' knowledge and experience of the Company, the Directors continue to adopt the going concern basis in preparing the financial statements for the year ended 31 March 2022.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.Accounting policies (continued)
Turnover represents project, development and asset management fee income, rental income, sale of stock properties and sale of investments.
Project, development and asset management fee income, which excludes value added tax, is recognised as services are provided. Sales of stock properties and investments are recorded once an irrevocable sale contract has been entered into, provided that the sale has been legally completed by the date on which the relevant financial statements are approved by the Directors. Full provision is made for all known or expected losses on completing a development once such losses are foreseen.
Rental income is recognised on a straight-line basis over the term of the lease. Incentives for lessees to enter into lease agreements are spread evenly over the lease term, even if payments are not made on such a basis. The lease term is the non-cancellable period of the lease together with any further term for which the tenant has the option to continue the lease, where, at inception of the lease, the Directors are reasonably certain that the tenant will exercise that option. Lease incentives are usually in the form of rent-free periods or capital contributions.
Sale of stock properties are recorded once an irrevocable sale contract has been entered into, provided that the sale has been legally completed by the date on which the relevant financial statements are approved by the Directors.
Income tax on the profit or loss for the year comprises current and deferred tax. Current tax is the tax payable on the taxable income for the year and any adjustment in respect of previous years. Deferred tax is provided in full using the Balance Sheet liability method on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is determined using tax rates that have been enacted or substantively enacted by the reporting date and are expected to apply when the asset is realised, or the liability is settled.
No provision is made for temporary differences (i) arising on the initial recognition of assets or liabilities, other than on a business combination, that affect neither accounting nor taxable profit and (ii) relating to investments in subsidiaries to the extent that they will not reverse in the foreseeable future.
Interest income is recognised in profit or loss using the effective interest method.
Borrowing costs relating to direct expenditure on stock under development are capitalised. The interest capitalised is calculated using the rate of interest on the loan to fund the expenditure, over the period from commencement of the development work until substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are completed. The capitalisation of finance costs is suspended if there are prolonged periods when development activity is interrupted. Capitalised interest is written off to direct costs on disposal of stock.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.Accounting policies (continued)
Investments in subsidiaries are measured at cost less accumulated impairment with any changes to be recognised in the Statement of comprehensive income. Management undertake an annual review of the carrying value of its investments to establish if there is any impairment to its value based on the performance of the underlying asset and external evidence. Income from investments relates to dividends received from subsidiaries which are recognised when the right to receive payment is established.
Cash and cash equivalents comprise cash balances, deposits held at call with banks and other shortterm highly liquid investments with original maturities of three months or fewer.
Work in progress, comprising developments, are carried as stocks and stated a lower of cost and fair value less costs to sell. Cost includes directly attributable expenditure and interest. The Company has capitalised certain internal staff costs directly attributable to the development schemes. Staff costs capitalised are estimated with reference to the time spent on the project during the period. Where the Director considers that the costs are not recoverable from the sale or development of the asset, the project or site is written down to its net realisable value, with the write down taken to the income statement. Fair value less costs to sell is calculated as the estimated value of the project or site, based upon our current plans, less all further costs to be incurred in making the sale.
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Trade and other receivables
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Trade and other receivables are recognised initially at fair value, subsequently at amortised cost and, where relevant, adjusted for the time value of money. The Company assesses on a forward looking basis, the expected credit losses associated with its trade receivables. A provision for impairment is made for the lifetime expected credit losses on initial recognition of the receivable. If collection is expected in more than one year, the balance is presented within non current assets.
In determining the expected credit losses, the Company takes into account any recent payment behaviours and future expectations of likely default events (i.e. not making payment on the due date) based on individual customer credit ratings, actual or expected insolvency filings or company voluntary arrangements and market expectations and trends in the wider macroeconomic environment in which our customers operate.
Trade and other receivables are written off once all avenues to recover the balances are exhausted and the lease has ended. Receivables written off are no longer subject to any enforcement activity.
Ordinary shares are classified as equity.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.Accounting policies (continued)
A provision is recognised in the Balance Sheet when the Company has a constructive or legal obligation as a result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation. Where relevant, provisions are determined by discounting the expected future cash flows at a pretax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
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Amounts owed to Group undertakings
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Amounts owed to Group undertakings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, amounts owed to Group undertakings are stated at amortised cost with any difference between the amount initially recognised and redemption value being recognised in the Statement of Comprehensive Income over the period of the loan, using the effective interest method.
ETrade and other payables with no stated interest rate and payable within one year are recorded at transaction price. Trade and other payables after one year are discounted based on the amortised cost method using the effective interest rate.
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Changes in accounting policies and standards
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The accounting policies used in these financial statements have been amended where relevant to reflect the adoption of new standards, amendments and interpretations which became effective in the year. There have been no new accounting standards, amendments or interpretations during the year that have a material impact on the financial statements of the Company.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Significant accounting judgements and estimates
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The Company’s significant accounting policies are stated in note 1 above. Not all of these significant accounting policies require management to make difficult, subjective or complex judgements or estimates. The following is intended to provide an understanding of the policies that management consider critical because of the level of complexity, judgement or estimation involved in their application and their impact on the financial statements. These estimates involve judgements in respect of future events. Actual results may differ from these estimates.
Stocks
The company is required to estimate when there is sufficient objective evidence to require the impairment of stocks carrying value. Work in progress, comprising developments, are carried as stocks and stated at the lower of cost and fair value less costs to sell. Cost includes directly attributable expenditure and interest. The company has capitalised certain internal staff costs directly attributable to the development of schemes. Staff costs capitalised are estimated with reference to the time spent on the project during the year. Where the Directors consider that the costs are not recoverable from the sale or development of the asset, the project or site is written down to its net realisable value, with the write down taken to the income statement through cost of sales. Fair value less costs to sell is calculated as the estimated value of the project or site, based upon our current plans, less all further costs to be incurred in making the sale.
Debtors
The company is required to judge when there is sufficient objective evidence to require the impairment of individual debtors. It does this on the basis of the age of the relevant receivables, external evidence of the credit status of the debtor entity and the nature of any disputed amounts. Trade debtors are recognised at the original transaction value and subsequently measured at amortised cost. A provision for impairment is established where there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables concerned. To measure the expected credit loss of trade debtors, the company has reviewed aged balances on an individual debtor basis. The company has based its assessment on previous bad debts, current trading conditions of the debtor and future expectations. As at 31 March 2022, the company considered the impact of the Covid-19 pandemic when assessing the impairment of debtors.
Amounts owed to group undertakings
The Company is required to estimate the impairment of amounts due from Group undertakings. It does this by assessing on a forward-looking basis, the expected credit losses associated with its amounts due from Group undertakings. A provision for impairment is made for the lifetime expected credit losses on initial recognition of the amounts due. In determining the expected credit losses, the Company takes into account any future expectations of likely default events based on the level of capitalisation of the counterparty, which is a fellow subsidiary undertaking of Land Securities Group PLC.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Management and administrative expenses
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(a) Management services
The Company had no employees during the year (2021: None). Management services were provided to the Company throughout the year by U and I Group Limited (formerly U and I Group PLC), a fellow subsidiary undertaking, charges for which amount to £3,275,299 (2021: £3,334,500).
(b) Directors' remuneration
The Company's directors' emoluments are borne by U and I Group Limited (formerly U and I Group PLC). The Directors of the Company, who as key management personnel of the Company, received no emoluments from U and I Group Limited (formerly U and I Group PLC) for their services to the Company (2021: None).
(c) Auditor remuneration
The Company's auditor's remuneration is borne by LS Development Holdings Limited (2021: U and I Group Limited (formerly U and I Group PLC). The proportion of the remuneration which relates to the Company amounts to £8,595 (2021: £4,000). No non-audit services were provided to the Cornpany durirg the year (2021: £Nil).
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An analysis of turnover by class of business is as follows:
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Development management fees
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Development and trading proceeds
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All turnover arose within the United Kingdom.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Income from fixed asset investments
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Dividends received from subsidiaries
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During the year, the Company received £7,700,000 (2021: £2,192,908) of dividends from its investments in U and I (Ashford) Limited, Development Securities (Maidstone) Limited and Development Securities (Hammersmith) Limited.
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Interest receivable and similar income
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Other interest receivable
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Adjustments in respect of previous periods
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
9.Tax on loss (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2021: lower than) the standard rate of corporation tax in the UK of 19.0% (2021: 19.0%). The differences are explained below:
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Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 19.0% (2021 - 19.0%)
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Adjustment to tax charge in respect of prior periods
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Provisions against intercompany loans and balances
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Write off investment and loss on investments
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Other expenses not deductible
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Share of partnership losses
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Other differences leading to an increase (decrease) in the tax charge
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Current year deferred tax
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Total tax charge for the year
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The Finance Act 2021 was substantially enacted in May 2021 and has increased the corporation tax rate to from 19% to 25% with effect from 1 April 2023. Any deferred taxation balances have been measured using the rates expected to apply in the reporting periods when the timing differences reverse.
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
The following balances relate to the total deferred tax asset not recognised on losses carried forward:
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Investments in subsidiary companies
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On 25 May 2021, the Company disposed of its investment in Cambourne Business Park Limited. The Company received proceeds of £13,194,780. The loss on disposal was £5,986,783.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
10.Investments (continued)
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Subsidiary undertakings and joint ventures
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The following were subsidiary undertakings of the Company:
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Development Securities(Greenwich) Limited
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Development Securities (Curzon Park) Limited
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Birmingham International Park (2000) Limited
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Development Securities (Hammersmith) Limited
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Development Securities (Sevenoaks) Limited
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Development Securities (Maidstone) Limited
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Percy Place DS (Ireland) Limited
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DS Jersey (Renewables) Ltd
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Beyond Green Developments (Broadland) Ltd
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Njord Wind Developments Ltd
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Cathedral (Greenwich Beach) Ltd
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Triangle Developments Limited
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Rivella Properties Bicester Limited
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Development Securities (Slough) Limited
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Kensington & Edinburgh (South Woodham Ferrers) Limited
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Investments in subsidiaries, joint ventures and associates are measured at cost less accumulated impairment with any changes to be recognised in the Statement of comprehensive income. Management undertake an annual review of the carrying value of its investments to establish if there is any impairment to its value based on the performance of the underlying asset and external evidence.
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Staff costs capitalised (see note below)
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In the year ended 31 March 2022, the Company disposed of all of its stock held at 399 Edgware Road.
The company capitalised certain internal staff costs of £383,788 (2021: £291,177) which were directly attributable to the development schemes for the year ended 31 March 2022. Staff costs capitalised are estimated with reference to the time spent on each project during the year.
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Trade and other receivables
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Due after more than one year
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Amounts owed by group undertakings
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Amounts owed by joint ventures and associated undertakings
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
12.Trade and other receivables (continued)
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Other debtors due after more than one year as at 31 March 2022 include £7,000,000 (2021: £10,500,000) of Harwell disposal balances due after more than one year and accrued income of £99,285 (2021: £723,750) to be received after more than one year.
The company has provided a further £2,300,215 (period ended 31 March 2021: £17,383,598) against amounts owed by group undertakings where recovery is considered doubtful. Apart from the receivables that have been provided for at the year end, there is no further material expected credit loss. The maximum exposure to credit risk at the reporting date is the carrying value of the receivable.
The unsecured amounts due from Group undertakings are interest free, unsecured, repayable on demand and with no fixed repayment date.
The unsecured amounts owed by joint ventures and associated undertakings are interest free, unsecured and repayable on demand.
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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The unsecured amounts owed to Group undertakings are interest free, unsecured, repayable on demand and with no fixed repayment date.
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Allotted, called up and fully paid
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2,000,002 (2021: 2,000,002) ordinary shares of £1.00 each
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U AND I (DEVELOPMENT AND TRADING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
The immediate parent company is U and I Group Limited (formerly U and I Group PLC).
On 14 December 2021, LS Development Holdings Limited acquired 100% of the share capital in U and I Group Limited (formerly U and I Group PLC). With effect from this date and as at 31 March 2022, the ultimate parent company and controlling party of U and I (Development and Trading) Limited was Land Securities Group PLC. This is the largest parent company of the Group to consolidate these financial statements.
Consolidated financial statements for the year ended 31 March 2022 for Land Securities Group PLC can be obtained from the Company Secretary, at the registered office of the ultimate parent company, 100 Victoria Street, London, SW1E 5JL and from the Group website at www.landsec.com. This is the largest and smallest Group to include these accounts in its consolidated financial statements.
All companies are incorporated in Great Britain and registered in England and Wales.
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Post balance sheet events
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On 7 April 2022, the Company exchanged contracts to sell its interest in the joint venture, UAIH Yorkshire for consideration of £941,780.
On 23 June 2022, the Company disposed of all its stock related to land known as Cambridge 4 to U and I (Cambridge) Limited. The stock was held at £3,356,000 and transferred at par. On the same date, U and I (Cambridge) Limited entered into a master development agreement with Cambridge 4 LLP in relation to the sale and development of the land.
On 31 March 2023, the Company sold the three commercial units held at Ilford, Valentines House for £424,149.
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