Simpson Assets 3 Limited - Accounts to registrar (filleted) - small 23.2.5

REGISTERED NUMBER: 13549351 (England and Wales)

FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 APRIL 2023

FOR

SIMPSON ASSETS 3 LIMITED

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3

DIRECTORS:

C. Christou

L. Hadjiioannou

REGISTERED OFFICE:

4th Floor Charles House

108-110 Finchley Road

London

NW3 5JJ

REGISTERED NUMBER:

13549351 (England and Wales)

AUDITORS:

Numera Partners LLP

Statutory Auditors

4th Floor

Charles House

108-110 Finchley Road

London

NW3 5JJ

FIXED ASSETS

Tangible assets

4

38,795,000

38,795,000

CURRENT ASSETS

Debtors

5

1,250,625

18,204

Cash at bank and in hand

529,178

163,889

1,779,803

182,093

CREDITORS

Amounts falling due within one year

6

22,043,531

20,562,834

NET CURRENT LIABILITIES

(20,263,728

)

(20,380,741

)

TOTAL ASSETS LESS CURRENT LIABILITIES

18,531,272

18,414,259

CREDITORS

Amounts falling due after more than one year

7

(18,025,429

)

(18,277,280

)

PROVISIONS FOR LIABILITIES

(5,138,148

)

(5,957,148

)

NET LIABILITIES

(4,632,305

)

(5,820,169

)

CAPITAL AND RESERVES

Called up share capital

100

100

Retained earnings

(4,632,405

)

(5,820,269

)

(4,632,305

)

(5,820,169

)

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

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors and authorised for issue on 22 January 2024 and were signed on its behalf by:

L. Hadjiioannou - Director

1.	STATUTORY INFORMATION

Simpson Assets 3 Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£) and rounded to the nearest £.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Significant judgements and estimates

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 items in the financial statements where these judgements and estimate have been made are included in the tangible fixed asset note.

The company reviews on an annual basis the carrying amount of tangible assets in order to determine if there is an indication of impairment. If any such indication exists, an impairment review is carried out in order to determine the extent of the impairment loss.

Valuation of debtors is based upon ongoing assessments of the probable estimated losses inherent in the trade and other debtors portfolio. Assessments are conducted by the board employing a methodology and guidelines, which are continually monitored and improved. The primary component of this methodology comprises specific allowances and collective allowances.

A debtor is subject to impairment test when valid indications exist, at the assessment date, which demonstrate that the customer will not be able to meet his obligations and/or when the flow of receipts decelerates over time. Usually such indications include failure of communication with the customers and indications of significant financial difficulty.

Amounts individually provided for concern claims evaluated individually for impairment based upon management's best estimate of the present value of the cash flows which are expected to be received.

The accuracy of provisions depends on the accuracy of future cash flows or specific allowances and the model assumptions and parameters used in determining collective allowances. While this necessarily involves judgement, management believe that their provisions are reasonable and supportable.

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 the future periods where the revision affects both the current and future periods.

Turnover

Turnover represents net invoiced rent receivable, excluding value added tax.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

The company adopts the group policy with regards to investment property as follows:

Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by the companies in the group, is classified as investment property. Investment property is measured initially at its cost, including related transaction costs. After initial recognition, investment property is carried at fair value. Fair value is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specified asset. If this information is not available, the company uses alternative valuation methods such as recent prices on less active markets or discounted cash flow projections.

Subsequent expenditure is included in the carrying amount of the property when it is probable that future economic benefit associated with the item will flow to the company and the cost of the item can be measured reliably. All other repairs and maintenance costs are charged to the profit and loss account during the financial period in which they are incurred.

In accordance with Financial Reporting Standard 102 (FRS 102), investment properties are revalued and the surplus or deficit is transferred to the profit and loss account, and no depreciation is provided in respect of freehold investment properties. The requirement of the Companies Act 2006 is to depreciate all properties, but that requirement conflicts with the generally accepted accounting principle set out in FRS 102. The director considers that to depreciate such properties would not give a true and fair view, but that a true and fair view is given by following FRS 102 as described above. The effect of this departure from the Companies Act 2006 has not been quantified because it is impracticable and, in the opinion of the director, would be misleading. Deferred tax is provided on these gains at the rate expected to apply when the property is sold.

Valuing the properties in the portfolio is a significant task and there are some subjectivities involved in the process. Not all accounting policies require management to make subjective or complex judgements or estimates. The following is intended to provide further detail relating to this accounting policy that management consider critical because of the level of complexity, judgement or estimation involved in its application and its impact on the financial statements.

Where possible the company obtains external valuations, however this is not considered practical or cost effective for the entire group's property portfolio. Accordingly, the balance of properties, after review by the directors, are valued by the company's own in house surveying team as at 30 April 2023. The in house surveying team use comparable data where available, such as sales prices, rental incomes and market yield information to establish the fair value at the balance sheet date.

The majority of the company's portfolio is invested in the type of properties where demand is high. Accordingly, the in house surveying team are well informed and have good recent information on current market values for similar properties. The in house surveying team also make reference to estimates of future rental income, property expenses and planning opportunities in order to value properties.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Financial instruments

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 contractual provisions of the instruments.

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

Basic financial instruments, 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.

Classification of financial liabilities

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

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 method.

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

Related parties

The company has taken advantage of FRS 102, Section 1AC.35, for the disclosure of transactions entered into between two or more members of a group, provided that any subsidiary which is party to the transaction is wholly owned by such a member. Amounts owed to and from group companies are therefore shown in aggregate.

Going concern

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company, therefore continues to adopt the going concern policy in preparing its financial statements.

Cash and cash equivalents

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.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was NIL (2022 - NIL).

4.	TANGIBLE FIXED ASSETS

Freehold

property

£

COST

At 1 May 2022

and 30 April 2023

38,795,000

NET BOOK VALUE

At 30 April 2023

38,795,000

At 30 April 2022

38,795,000

Freehold property to the sum of £38,795,000 is included at fair value as valued by the director.

The company after review by the director, uses valuations performed by its own in house surveying team to value its own residential and commercial investment properties as at 30 April 2023.

The assumptions relevant to the valuation of investment property are outlined in Note 2 above.

Rental income from investment property during the year was £1,755,416 (2022: £295,269).

5.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.4.23

30.4.22

£

£

Trade debtors

11,747

18,204

Other debtors

1,238,878

-

1,250,625

18,204

6.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.4.23

30.4.22

£

£

Bank loans and overdrafts

300,000

300,000

Trade creditors

12,517

2,859

Amounts owed to group undertakings

20,625,934

19,285,313

Other creditors

1,105,080

974,662

22,043,531

20,562,834

7.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

30.4.23

30.4.22

£

£

Bank loans

18,025,429

18,277,280

8.	SECURED DEBTS

The following secured debts are included within creditors:

30.4.23

30.4.22

£

£

Bank loans

18,325,429

18,577,280

Bank loans are secured by way of a fixed and floating mortgage charge over the companys' property.

9.	DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

Giles Cohen (Senior Statutory Auditor)

for and on behalf of Numera Partners LLP

10.	RELATED PARTY DISCLOSURES

Included in creditors due within one year is an amount of £20,625,934 (2022: £19,285,313) owed to group undertakings.

Amounts outstanding between group companies arise by virtue of financing transactions. These amounts are unsecured, interest free and due within one year.

11.	FRC ETHICAL STANDARD - PROVISIONS AVAILABLE FOR SMALL ENTITIES

In common with many other businesses of our size and nature we use our auditors to prepare and submit returns to the tax authorities and assist with the preparation of the financial statements.

12.	SHAREHOLDERS' FUNDS

Included in retained earnings are amounts which are distributable and not distributable to the shareholders. These are £505,743 and -£5,138,148 respectively.