Rayglow Securities Limited - Period Ending 2016-12-31

Registration number: 01305563

Rayglow Securities Limited

Unaudited Financial Statements

for the Year Ended 31 December 2016

Rayglow Securities Limited

Contents

Company Information	1
Balance Sheet	2 to 3
Statement of Changes in Equity	4
Notes to the Financial Statements	5 to 17

Rayglow Securities Limited

Company Information

Directors

T P Lewis PK Ison S N G Barratt C J Newman

Company secretary

C J Newman

Registered office

34 Boulevard Weston-super-Mare Somerset BS23 1NF

Accountants

Four Fifty Partnership Chartered Accountants 34 Boulevard Weston-super-Mare Somerset BS23 1NF

Page 1

Rayglow Securities Limited

(Registration number: 01305563)
Balance Sheet as at 31 December 2016

	Note	2016 £	2015 £
Fixed assets
Investment property	4	6,375,000	6,562,000
Investments	5	-	100
		6,375,000	6,562,100
Current assets
Debtors	7	3,393,145	3,350,837
Other financial assets	6	1,061	944
Cash at bank and in hand		759,661	1,235,093
		4,153,867	4,586,874
Creditors: Amounts falling due within one year	8	(257,891)	(916,935)
Net current assets		3,895,976	3,669,939
Net assets		10,270,976	10,232,039
Capital and reserves
Called up share capital		1,353,600	1,353,600
Profit and loss account		6,994,942	6,894,932
Non-distributable reserve		1,922,434	1,983,507
Total equity		10,270,976	10,232,039

For the financial year ending 31 December 2016 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

•	The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and
•	The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

The notes on pages 5 to 17 form an integral part of these financial statements.

Page 2

Rayglow Securities Limited

(Registration number: 01305563)
Balance Sheet as at 31 December 2016 (continued)

These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 27 September 2017 and signed on its behalf by:
 

.........................................

T P Lewis

Director

The notes on pages 5 to 17 form an integral part of these financial statements.

Page 3

Rayglow Securities Limited

Statement of Changes in Equity for the Year Ended 31 December 2016

	Share capital £	Non-distributable reserve £	Profit and loss account £	Total £
At 1 January 2016	1,353,600	1,983,507	6,894,931	10,232,038
Profit for the year	-	-	288,938	288,938
Total comprehensive income	-	-	288,938	288,938
Dividends	-	-	(250,000)	(250,000)
Transfers	-	(61,073)	61,073	-
At 31 December 2016	1,353,600	1,922,434	6,994,942	10,270,976

	Share capital £	Non-distributable reserve £	Profit and loss account £	Total £
At 1 January 2015	1,353,600	1,586,263	6,864,601	9,804,464
Profit for the year	-	-	677,575	677,575
Total comprehensive income	-	-	677,575	677,575
Dividends	-	-	(250,000)	(250,000)
Transfers	-	397,244	(397,244)	-
At 31 December 2015	1,353,600	1,983,507	6,894,932	10,232,039

The notes on pages 5 to 17 form an integral part of these financial statements.

Page 4

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016

1	General information

The company is a private company limited by share capital, incorporated in England and Wales.

These financial statements were authorised for issue by the Board on 27 September 2017.

2	Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.

The company has transitioned from FRSSE 2015 to FRS 102 as at 1 January 2015. An explanation of how transition to FRS 102 has affected the reported financial position and financial performance is given in note 14.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The presentation currency of the financial statements is the Pound Sterling (£).

Group accounts not prepared

In accordance with Section 399 of the Companies Act 2006, exemption has been taken from preparing group accounts on the grounds that the company qualifies as the parent of a small group.

Page 5

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

2	Accounting policies (continued)

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.

The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.

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

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing differences.

Page 6

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

2	Accounting policies (continued)

Investment property

Investment properties are carried at fair value, derived from the current market prices for comparable real estate determined annually by external valuers. The valuers use observable market prices, adjusted if necessary for any difference in the nature, location or condition of the specific asset. Changes in fair value are recognised in profit or loss.

The acquisition of investment properties is recognised for accounts purposes on exchange of contracts but a property sale is not recognised until legal completion takes place.

No depreciation is provided in respect of investment properties. Although the Companies Act 2006 would ordinarily require the systematic annual depreciation of fixed assets, it is believed that this policy of not providing depreciation is necessary in order for the financial statements to give a true and fair view as the properties are reported at fair value and are regularly maintained.

Investments

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

Page 7

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

2	Accounting policies (continued)

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases.

Amounts received under operating leases are credited to the profit and loss account on a straight-line basis over the period of the lease, except where the lease was entered into before the FRS102 transition date or where doing so would not result in a true and fair view.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Financial instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as either financial assets, liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company, after deducting all liabilities.
 
 

Page 8

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

3	Staff numbers

The average number of persons employed by the company (including directors) during the year, was 2 (2015 - 2).

4	Investment properties

	2016 £
At 1 January	6,562,000
Additions	68,914
Disposals	(190,000)
Fair value adjustments	(65,914)
At 31 December	6,375,000

The company's investment property portfolio was valued on an open market basis on 31 December 2016 by Messrs Boddy and Edwards, Chartered Surveyors.

If investment properties had not been revalued they would have been included at their historical cost of £4,452,566 (2015 - £4,655,308).

No provision has been made for deferred tax on losses recognised on revaluing investment properties to their fair values and unutilised capital losses on disposal. The current estimate is that there is an unprovided deferred tax asset of £73,894 (2015 - £46,687). The directors have not recognised this asset as it is their long-term intention to retain the investment properties.

Impairment of investment property

The amount of impairment loss included in profit or loss is £Nil (2015 - £35,000).

5	Investments

	2016 £	2015 £
Investments in subsidiaries	-	100

Page 9

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

5	Investments (continued)

Subsidiaries	£
Cost or valuation
At 1 January 2016	100
Disposals	(100)
At 31 December 2016	-
Provision
Carrying amount
At 31 December 2016	-
At 31 December 2015	100

Due to the non-trading nature of the subsidiary, cost was deemed to be the fair value.

The subsidiary company was dissolved on 5 July 2016.

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking	Registered office	Holding	Proportion of voting rights and shares held
			2016	2015
Subsidiary undertakings
Guideglow Limited	3-5 College Street, Burnham-on-Sea, Somerset, TA8 1AR	Ordinary	0%	100%
	England and Wales

The principal activity of Guideglow Limited is dormant

Page 10

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

6	Other financial assets (current and non-current)

	Financial assets at fair value through profit and loss £	Total £
Current financial assets
Cost or valuation
At 1 January 2016	945	945
Fair value adjustments	116	116
At 31 December 2016	1,061	1,061
Carrying amount
At 31 December 2016	1,061	1,061

No provision has been made for deferred tax on losses recognised in revaluing listed shares to their fair values. The current estimate is that there is an unprovided deferred tax asset of £10,846 (2015 - £10,869). The directors have not recognised this asset as it is their long-term intention to retain the shares.

Page 11

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

7

Debtors

	Note	2016 £	2015 £
Trade debtors		131,763	140,693
Amounts owed by group undertakings and undertakings in which the company has a participating interest	12	2,950,686	2,950,586
Taxation and social security		497	-
Prepayments and accrued income		92,317	74,558
Other debtors		217,882	185,000
		3,393,145	3,350,837

Details of non-current trade and other debtors

£178,701 (2015 -£185,000) of Mortgage is classified as non current. This 15 year mortgage, totalling £185,000, was issued during the year ended 31 December 2015. Interest is being charged upon the same.

8

Creditors

Creditors: amounts falling due within one year

	2016 £	2015 £
Due within one year
Trade creditors	8,195	704,639
Taxation and social security	16,390	16,208
Accruals and deferred income	139,539	126,987
Other creditors	93,767	69,101
	257,891	916,935

Page 12

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

9	Share capital

Allotted, called up and fully paid shares

	2016		2015
	No.	£	No.	£
Ordinary of £1 each	1,353,600	1,353,600	1,353,600	1,353,600

10

Dividends

Final dividends paid

	2016 £	2015 £
Final dividend of £0.18 (2015 - £0.18) per each Ordinary share	250,000	250,000

11	Financial commitments, guarantees and contingencies

Amounts not provided for in the balance sheet

The total amount of financial commitments not included in the balance sheet is £340,229 (2015 - £Nil). This is in relation to the purchase of a further investment property for £325k plus associated costs. Exchange and completion in respect of this property occurred in February 2017 however, the deposit was paid during the year under review.

12	Related party transactions

Directors' remuneration

The directors' remuneration for the year was as follows:

	2016 £	2015 £
Remuneration	12,129	13,890

Page 13

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

12	Related party transactions (continued)

Summary of transactions with parent

Fareshape Limited
 

Summary of transactions with subsidiaries

Guideglow Limited
 

Loans to related parties

2016	Parent £
At start of period	2,950,686
At end of period	2,950,686

2015	Parent £
At start of period	2,950,686
At end of period	2,950,686

Terms of loans to related parties

The loan to the parent company is interest-free and repayable on demand.

No fair value adjustment has been made as the loan was repaid in full on 10 August 2017.
 

Loans from related parties

2016	Subsidiary £
At start of period	100
Repaid	(100)
At end of period	-

2015	Subsidiary £
At start of period	100
At end of period	100

Page 14

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

12	Related party transactions (continued)

Terms of loans from related parties

The loan from the subsidiary company was repaid during the year under review.
 

13	Parent and ultimate parent undertaking

The company's immediate parent is Fareshape Limited, incorporated in England and Wales.

 

14	Transition to FRS 102

These financial statements have been prepared in compliance with FRS102 (Section 1A) - The Financial Reporting Standard applicable in the UK and Republic of Ireland and the Companies Act 2006.

This is the first year in which the financial statements have been prepared under FRS102 (Section 1A). Details of the transition to FRS102 (Section 1A) are disclosed below:

Section 16 'Investment Property' of FRS102 requires changes in fair value to be recognised in the profit and loss account whereas, under the FRSSE 2015, temporary revaluation adjustments were recognised within the Statement of Recognised Gains and Losses with only permanent diminutions in value being reported in the profit and loss account. Reclassifications have therefore been made in respect of prior year temporary revaluation adjustments and these are represented within the tables below.

As investment property revaluation gains are not distributable, a non-distributable profit and loss reserve has been maintained and reflected within the financial statements in order to give a true and fair view. Reclassifications have therefore been made and these are represented within the tables below.

Section 20 'Leases' of FRS102 requires operating lease incentives to be recognised over the full period of the lease whereas, UITF 28 required operating lease incentives to be recognised over the period until a full market rent is paid. As a first-time adopter of FRS102, the company has continued the previous UITF 28 recognition policy where the operating lease was entered into before the date of transition. Remeasurements in respect of operating lease incentives entered into after the date of transition, and the Corporation Tax thereon, are represented within the tables below.

Page 15

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

14	Transition to FRS 102 (continued)

Balance Sheet at 1 January 2015
 

	As originally reported £	Reclassification £	Remeasurement £	As restated £
Fixed assets
Investment property	5,895,000	-	-	5,895,000
Investments	100	-	-	100
	5,895,100	-	-	5,895,100
Current assets
Debtors	3,063,748	-	-	3,063,748
Current investments	5,492	-	-	5,492
Cash at bank and in hand	988,933	-	-	988,933
	4,058,173	-	-	4,058,173
Creditors: Amounts falling due within one year	(148,809)	-	-	(148,809)
Net current assets	3,909,364	-	-	3,909,364
Net assets	9,804,464	-	-	9,804,464
Capital and reserves
Called up share capital	(1,353,600)	-	-	(1,353,600)
Revaluation reserve	(1,586,263)	1,586,263	-	-
Profit and loss account	(6,864,601)	-	-	(6,864,601)
Profit and loss account - Non distributable (investment property)	-	(1,586,263)	-	(1,586,263)
Total equity	(9,804,464)	-	-	(9,804,464)

Page 16

Rayglow Securities Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

14	Transition to FRS 102 (continued)

Balance Sheet at 31 December 2015
 

	As originally reported £	Reclassification £	Remeasurement £	As restated £
Fixed assets
Investment property	6,562,000	-	-	6,562,000
Investments	100	-	-	100
	6,562,100	-	-	6,562,100
Current assets
Debtors	3,347,456	-	3,380	3,350,836
Current investments	944	-	-	944
Cash at bank and in hand	1,235,093	-	-	1,235,093
	4,583,493	-	3,380	4,586,873
Creditors: Amounts falling due within one year	(916,258)	-	(676)	(916,934)
Net current assets	3,667,235	-	2,704	3,669,939
Net assets	10,229,335	-	2,704	10,232,039
Capital and reserves
Called up share capital	(1,353,600)	-	-	(1,353,600)
Revaluation reserve	(1,983,507)	1,983,507	-	-
Profit and loss account	(6,892,228)	-	(2,704)	(6,894,932)
Profit and loss account - Non distributable (investment property)	-	(1,983,507)	-	(1,983,507)
Total equity	(10,229,335)	-	(2,704)	(10,232,039)

Page 17