ELC_(TRANCHE_1)_LIMITED - Accounts

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

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

ELC (Tranche 1) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Richard House, 9 Winckley Square, Preston, PR1 3HP. The principal place of business is Unit 18, The South Range, Hackthorpe Hall Business Centre, Hackthorpe, Penrith, CA10 2HX.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include investment properties at fair value. The principal accounting policies adopted are set out below.

The company completed the build phase of two health centres in 2014 and the company is receiving rental income from these which will be used to meet its ongoing obligations. true

The funding provided from the lenders is structured based on the 25 year financial model used by the company on each of the projects. The company is meeting all the required interest and capital repayments as they fall due.

The directors believe it appropriate to prepare the accounts on a going concern basis.

The turnover shown in the profit and loss account represents rents, charges and other amounts receivable during the period, exclusive of Value Added Tax.

Rental income is recognised as turnover in the period to which the charge relates.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised initially in the profit and loss account. A transfer is then made at the year end to move the fair value adjustments, net of the movement in the deferred tax provision, to the non-distributable revaluation reserve.

Cash and cash equivalents are basic financial assets and include cash in hand.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

The company does not have any non-basic financial assets.

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

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies 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 receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or 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.

The company does not have any non-basic financial liabilities.

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

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

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

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

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

The directors were required to review the position on the land and buildings and whether it was appropriate for these to be classified as a finance lease asset or as an investment property. In making this assessment the directors were required to consider whether the lease arrangements transferred substantially all the risks and rewards incidental to ownership.

In making this assessment, the directors considered a number of factors in line with the indicators listed in paragraph 20.5 of FRS 102. The directors concluded that the company had retained the risks and rewards of ownership and therefore the land and buildings have been classified as an investment property.

The company had no employees in either the current or preceding year.

The directors have a policy whereby they obtain an independent, third party valuation every four years. The last full valuation was performed by a RICS registered valuer as at 31 March 2017. The valuation was performed in accordance with the RICS Valuation – Global Standards 2017 (the “Red Book”) and Practice Statement VPGA 60/2010, the Valuation of Medical Centre & Surgery Premises.

In the interim years the directors obtain a limited information valuation report. The last such report confirmed there had been no material change to the fair value of the investment property as at the balance sheet date.

The amount of creditors due within one year for which security over the investment properties has been given is £245,930 (2018: £207,052).

The amount of creditors due after more than one year for which security has been given is £17,000,899 (2018: £17,246,829). Of this amount £14,865,024 (2018: £15,110,954) is secured over the investment properties.

The balance on the revaluation reserve represents the accumulated fair value adjustments in respect of investment properties, net of the deferred tax provision thereon.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

Barbentas Developments LLP, incorporated in England and Wales, is the ultimate parent company of ELC (Tranche 1) Limited.

The company has taken advantage of the exemption permitted under Section 33 'Related Party Disclosures' paragraph 33.1A from disclosing transactions with wholly owned group companies.