Cedar Care Homes Limited - Limited company accounts 18.1d

REGISTERED NUMBER: 03585946 (England and Wales)

Strategic Report, Report of the Directors and

Audited Financial Statements

for the Year Ended 31 July 2017

for

Cedar Care Homes Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

Income Statement

6

Other Comprehensive Income

7

Balance Sheet

8

Statement of Changes in Equity

9

Cash Flow Statement

10

Notes to the Cash Flow Statement

11

Notes to the Financial Statements

12

DIRECTORS:

Mr M C Desai

Mr K C Desai

Mr A M Desai

Mrs M A Desai

SECRETARY:

Mr A M Desai

REGISTERED OFFICE:

Head Office

20 Richmond Hill

Clifton

Bristol

BS8 1BA

REGISTERED NUMBER:

03585946 (England and Wales)

AUDITORS:

Wormald & Partners

Redland House

157 Redland Road

Redland

Bristol

BS6 6YE

The directors present their strategic report for the year ended 31 July 2017.

REVIEW OF BUSINESS

The principal activity of the company was that of the owning and operating of nursing homes.

The company operates from locations in Bristol and Bath and provides General Nursing Care, Residential Care,Dementia Care and

also provides for Mental Disorder and Residential Dementia.

All of the homes operated by the company are monitored by Care Quality Commission (CQC) and ensures the company meets the

standards set by the CQC.

The results for the year and the financial position at the year end were considered satisfactory by the directors.

Despite the current economic climate, the directors expect to see continued growth in the company for the foreseeable future both

organically and through further anticipated acquisitions.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors consider there to be no significant risks and uncertainties associated with the business.

The company manages the liquidity risk by ensuring the continuity of funding and flexibility through maintaining adequate bank

reserves, with trade creditors liquidity risk managed by ensuring sufficient funds are available to meet amounts due for payment.

Trade debtors are managed in respect of credit and cash flow risk by policies concerning the customers' credit accounts, together

with the daily monitoring of amounts outstanding.

ON BEHALF OF THE BOARD:

Mr A M Desai - Secretary

27 April 2018

The directors present their report with the financial statements of the company for the year ended 31 July 2017.

DIVIDENDS

No dividends will be distributed for the year ended 31 July 2017.

DIRECTORS

The directors set out in the table below have held office during the whole of the period from 1 August 2016 to the date of this report.

The beneficial interests of the directors holding office at 31 July 2017 in the shares of the company, according to the register of

directors' interests, were as follows:

31.7.17

1.8.16

Ordinary shares of £1 each

Mr M C Desai

10,000

10,000

Mr K C Desai

10,000

10,000

Mr A M Desai

10,000

10,000

Mrs M A Desai

-

-

These directors did not hold any non-beneficial interests in the shares of the company.

MARKET VALUE OF LAND AND BUILDINGS

In the opinion of the directors, the present market value of the company's properties exceeds that at which they are stated in the

financial statements.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 United Kingdom Generally Accepted Accounting Practice (United

Kingdom Accounting Standards and applicable law). 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 and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	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 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of

which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a

director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are

aware of that information.

AUDITORS

The auditors, Wormald & Partners, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr A M Desai - Secretary

27 April 2018

Opinion

We have audited the financial statements of Cedar Care Homes Limited (the 'company') for the year ended 31 July 2017 which

comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow

Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, 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 Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the

UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

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 a Report of the Auditors 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.

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 July 2017 and of its profit 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 Auditors' 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and

the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance

conclusion thereon.

In connection with our audit of the financial statements, 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 audit or

otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material

misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have

not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where 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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 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.

Our 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 a Report of the Auditors 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.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's

website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Neil Dando FCA (Senior Statutory Auditor)

for and on behalf of Wormald & Partners

Redland House

157 Redland Road

Redland

Bristol

BS6 6YE

27 April 2018

TURNOVER

15,094,416

11,892,058

Cost of sales

9,728,850

7,355,638

GROSS PROFIT

5,365,566

4,536,420

Administrative expenses

1,844,428

1,628,564

3,521,138

2,907,856

Other operating income

219,931

180,000

OPERATING PROFIT

4

3,741,069

3,087,856

Interest receivable and similar income

1,501

118,552

3,742,570

3,206,408

Interest payable and similar expenses

5

466,750

(421,559

)

PROFIT BEFORE TAXATION

3,275,820

3,627,967

Tax on profit

6

142,511

767,981

PROFIT FOR THE FINANCIAL YEAR

3,133,309

2,859,986

PROFIT FOR THE YEAR

3,133,309

2,859,986

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

3,133,309

2,859,986

FIXED ASSETS

Intangible assets

7

-

-

Tangible assets

8

32,450,263

30,689,241

32,450,263

30,689,241

CURRENT ASSETS

Stocks

9

23,407

19,424

Debtors

10

975,924

497,014

Cash at bank and in hand

1,257,351

1,233,306

2,256,682

1,749,744

CREDITORS

Amounts falling due within one year

11

2,281,922

2,270,646

NET CURRENT LIABILITIES

(25,240

)

(520,902

)

TOTAL ASSETS LESS CURRENT LIABILITIES

32,425,023

30,168,339

CREDITORS

Amounts falling due after more than one year

12

17,734,716

18,611,341

NET ASSETS

14,690,307

11,556,998

CAPITAL AND RESERVES

Called up share capital

17

30,000

30,000

Retained earnings

18

14,660,307

11,526,998

SHAREHOLDERS' FUNDS

14,690,307

11,556,998

The financial statements were approved by the Board of Directors on 27 April 2018 and were signed on its behalf by:

Mr A M Desai - Director

Mrs M A Desai - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 August 2015

30,000

8,667,012

8,697,012

Changes in equity

Total comprehensive income

-

2,859,986

2,859,986

Balance at 31 July 2016

30,000

11,526,998

11,556,998

Changes in equity

Total comprehensive income

-

3,133,309

3,133,309

Balance at 31 July 2017

30,000

14,660,307

14,690,307

Cash flows from operating activities

Cash generated from operations

1

4,219,676

4,092,031

Interest paid

(457,802

)

425,802

Interest element of hire purchase payments paid

(8,948

)

(4,243

)

Tax paid

(794,143

)

(497,696

)

Net cash from operating activities

2,958,783

4,015,894

Cash flows from investing activities

Purchase of tangible fixed assets

(2,230,112

)

(7,267,067

)

Interest received

1,501

118,552

Net cash from investing activities

(2,228,611

)

(7,148,515

)

Cash flows from financing activities

New loans in year

-

6,075,929

Loan repayments in year

(678,702

)

(785,474

)

Capital repayments in year

(37,620

)

(65,657

)

Amount introduced by directors

-

34,004

Amount withdrawn by directors

(11,647

)

(1,477,759

)

Net cash from financing activities

(727,969

)

3,781,043

Increase in cash and cash equivalents

2,203

648,422

Cash and cash equivalents at beginning of year

2

1,233,306

584,884

Cash and cash equivalents at end of year

2

1,235,509

1,233,306

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2017

2016

£

£

Profit before taxation

3,275,820

3,627,967

Depreciation charges

469,089

354,093

Finance costs

466,750

(421,559

)

Finance income

(1,501

)

(118,552

)

4,210,158

3,441,949

Increase in stocks

(3,983

)

(458

)

(Increase)/decrease in trade and other debtors

(35,529

)

373,392

Increase in trade and other creditors

49,030

277,148

Cash generated from operations

4,219,676

4,092,031

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these

Balance Sheet amounts:

Year ended 31 July 2017

31.7.17

1.8.16

£

£

Cash and cash equivalents

1,257,351

1,233,306

Bank overdrafts

(21,842

)

-

1,235,509

1,233,306

Year ended 31 July 2016

31.7.16

1.8.15

£

£

Cash and cash equivalents

1,233,306

584,884

1.	STATUTORY INFORMATION

Cedar Care Homes 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.

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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover

Turnover represents net invoiced fees.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of care homes is being amortised evenly over its

estimated useful life of five years.

In view of the changes in Government legislation concerning the compliance standards now imposed on Care Homes the

directors believe that goodwill should now be written off over it estimated useful life of five years from the previously

adopted policy of ten years.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any

accumulated amortisation and any accumulated impairment losses.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

2% on cost

Fixtures and fittings

-

15% on reducing balance basis

Motor vehicles

-

25% on straight line basis

Computer equipment

-

33.33% on straight line basis

No depreciation is charged on freehold land or assets in the course of construction.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving

items.

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.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under

hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated

over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the

future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme

are charged to profit or loss in the period to which they relate.

3.	EMPLOYEES AND DIRECTORS

2017

2016

£

£

Wages and salaries

7,996,167

5,914,154

Social security costs

678,101

494,892

Other pension costs

45,278

121,763

8,719,546

6,530,809

The average number of employees during the year was as follows:

2017

2016

Administration & maintenance

43

46

Nursing care & domestic

358

280

401

326

Please note that a significant number of the employees of Cedar Care Homes Limited are part time or part time equivalent.

2017

2016

£

£

Directors' remuneration

100,000

104,999

Directors' pension contributions to money purchase schemes

-

88,613

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

1

1

4.	OPERATING PROFIT

The operating profit is stated after charging:

2017

2016

£

£

Hire of plant and machinery

2,078

10,548

Depreciation - owned assets

465,759

330,423

Depreciation - assets on hire purchase contracts

3,331

23,667

Auditors remuneration

6,000

4,800

Other taxation services

4,500

4,250

Other financial services

30,807

31,362

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2017

2016

£

£

Bank loan interest

451,920

450,490

IRHP redress payment

-

(876,292

)

Other interest

5,882

-

Hire purchase

8,948

4,243

466,750

(421,559

)

6.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2017

2016

£

£

Current tax:

UK corporation tax

585,892

676,563

Deferred tax

(443,381

)

91,418

Tax on profit

142,511

767,981

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained

below:

2017

2016

£

£

Profit before tax

3,275,820

3,627,967

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2016 - 20%)

622,406

725,593

Effects of:

Expenses not deductible for tax purposes

10,130

8,409

Capital allowances in excess of depreciation

(66,764

)

(57,439

)

Adjustments to tax charge in respect of previous periods

20,120

-

Deferred tax

(443,381

)

91,418

Total tax charge

142,511

767,981

7.	INTANGIBLE FIXED ASSETS

Goodwill

£

COST

At 1 August 2016

and 31 July 2017

901,670

AMORTISATION

At 1 August 2016

and 31 July 2017

901,670

NET BOOK VALUE

At 31 July 2017

-

At 31 July 2016

-