Saffronland Homes 2 Limited - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: 11171167 (England and Wales)

SAFFRONLAND HOMES 2 LIMITED

FINANCIAL STATEMENTS FOR THE PERIOD 26 JULY 2018 TO 31 JULY 2019

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3

DIRECTOR:

Mr A M Lakhani

REGISTERED OFFICE:

Maple House

121b Winchester Road

Chandlers Ford

Eastleigh

Hampshire

SO53 2DR

REGISTERED NUMBER:

11171167 (England and Wales)

AUDITORS:

Rothmans Audit LLP

Statutory Auditors

Chartered Accountants

Fryern House

125 Winchester Road

Chandlers Ford

Hampshire

SO53 2DR

FIXED ASSETS

Tangible assets

3

11,536,198

-

CURRENT ASSETS

Stocks

5,000

-

Debtors

4

278,633

100

Cash at bank

7,937

-

291,570

100

CREDITORS

Amounts falling due within one year

5

8,172,856

-

NET CURRENT (LIABILITIES)/ASSETS

(7,881,286

)

100

TOTAL ASSETS LESS CURRENT LIABILITIES

3,654,912

100

CAPITAL AND RESERVES

Called up share capital

200

100

Share premium

3,832,046

-

Retained earnings

(177,334

)

-

SHAREHOLDERS' FUNDS

3,654,912

100

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 director and authorised for issue on 31 July 2020 and were signed by:

Mr A M Lakhani - Director

1.	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.

The presentation currency is £ sterling.

Significant judgements and estimates

The preparation of the financial statements requires management to make judgements, estimates and

assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date, and the

amounts reported for revenues and expenses during the year. However, the nature of estimation means that

actual outcomes could differ from those estimates.

The following judgements (apart from those involving estimates) have had the most significant effect on amounts

recognised in the financial statements.

1)

Impairment of assets

Management use their judgement to determine if there are any indicators of impairment.

Other key sources of estimation uncertainty;

1)

Tangible assets

Management estimate the useful life and residual value of tangible assets based on market information and their knowledge of the business, the remaining life of the asset and projected disposal value.

Turnover

Turnover is generated from the provision of residential care services.

Turnover is recognised based on the occupation of the residential care homes and adjusted for accrued and

deferred income where necessary.

Turnover is exempt from Value Added Tax.

Tangible fixed assets

All fixed assets are initially recognised at cost and subsequently carried at cost less accumulated depreciation

and accumulated impairment losses.

The cost of fixed assets initially recognised includes its purchase price and any cost that is directly attributable to

bringing the asset to the location and condition necessary for it to be capable of operating in a manner intended

by management.

Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful

economic life of that asset as follows:

Freehold property

Straight line over 134 - 138 years

Fixtures and fittings

25% reducing balance

Plant & machinery

25% reducing balance

Computer equipment

25% reducing balance

The assets' residual values and useful lives are reviewed and adjusted, if appropriate, at the end of each

reporting period. The effect of any change is accounted for prospectively.

Fixed assets are derecognised on disposal or when no future economic benefits are expected. On disposal, the

difference between the net disposal proceeds and the carrying amount is recognised in the income statement.

Stocks

Stocks are valued at the lower of cost and net realisable value. Cost is based on the cost of purchases on a first

in, first out basis. Net realisable value is based on estimated selling price less additional costs to completion and

disposal.

Taxation

Taxation for the period 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 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 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 period 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.

Going concern

The going concern assumption is based upon the continuing support of other group companies, which provide

working capital in the form of loan finance. The Group has the continuing support from the Director personally.

The Director has confirmed that this support will continue to be available, for at least 12 months from the date of

signing of these financial statements.

The Director has also obtained financial forecasts for a period of greater than 12 months from the approval of

these financial statements, which show that the company will be able to meet its liabilities as they fall due.

These financial statements have therefore been prepared on a going concern basis.

Financial instruments

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 entity after deducting all of its financial liabilities.

Where the contractual obligations of financial instruments (including share capital) are equivalent to a similar

debt instrument, those financial instruments are classed as financial liabilities. Financial liabilities are presented

as such in the balance sheet. Finance costs and gains or losses relating to financial liabilities are included in the

income statement. Finance costs are calculated so as to produce a constant rate of return on the outstanding

liability.

Where the contractual terms of share capital do not have any terms meeting the definition of a financial liability

then this is classed as an equity instrument. Dividends and distributions relating to equity instruments are

debited direct to equity.

Amounts payable or receivable on derivatives held to manage interest rate risk (including swap agreements) are

recognised over the period of the contract. Changes in the derivative's fair value are not recognised.

Gains and losses on derivatives used to hedge price exposures are deferred and recognised in the income

statement when the hedged transaction occurs.

All premiums or fees, paid or received, in respect of a financial instrument are accounted for over the life of the

matched underlying asset, liability, income or cost, even if the instrument has been sold. If the matched

underlying asset, liability, income or cost ceases to exist, or is not longer considered likely to exist in the future,

the hedging instrument is sold. Any profit or loss on the sale is recognised in the income statement as part of

operating profit.

Finance costs

Finance costs are charged to the income statement over the term of the debt using the addictive interest rate

method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially

recognised as a reduction on the proceeds of the associated capital instrument.

Exceptional items

Exceptional items are one off, material items outside the normal course of business which are not related to the

company's trading activities.

2.	EMPLOYEES AND DIRECTORS

The average number of employees during the period was 97 (2018 - NIL ) .

3.	TANGIBLE FIXED ASSETS

Fixtures

Freehold

Plant and

and

Computer

property

machinery

fittings

equipment

Totals

£

£

£

£

£

COST

Additions

11,540,000

4,057

98,352

730

11,643,139

At 31 July 2019

11,540,000

4,057

98,352

730

11,643,139

DEPRECIATION

Charge for period

85,596

953

20,236

156

106,941

At 31 July 2019

85,596

953

20,236

156

106,941

NET BOOK VALUE

At 31 July 2019

11,454,404

3,104

78,116

574

11,536,198

The freehold properties of the company are secured against the groups bank loan.

4.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2019

2018

£

£

Trade debtors

259,010

-

Other debtors

11,372

100

Prepayments

8,251

-

278,633

100

5.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2019

2018

£

£

Bank loans and overdrafts

115,630

-

Trade creditors

156,922

-

Amounts owed to group undertakings

7,727,216

-

Other creditors

164,388

-

Accruals and deferred income

8,700

-

8,172,856

-

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

The Report of the Auditors was unqualified.

Robin Lloyd FCA (Senior Statutory Auditor)

for and on behalf of Rothmans Audit LLP

7.	CONTINGENT LIABILITIES

The company has a cross guarantee with its holding company, Saffronland Group Limited, in favour of Coutts &

Company to guarantee its loan. The total indebtedness at the balance sheet date was £18,150,000.

8.	SHARE PREMIUM

In the year 100 Ordinary shares with a nominal of £1 each were issued in exchange for the trade and assets of a

care home trade, resulting in £3,832,046 of share premium.

9.	RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party

transactions with wholly owned subsidiaries within the group.

10.	ULTIMATE PARENT COMPANY AND ULTIMATE CONTROLLING PARTY

The company's immediate parent undertaking is Saffronland Group Limited and its ultimate parent undertaking is

Saffronland Investments Limited, a company incorporated in England and Wales. The ultimate control of that

company is exercise by Mr A M Lakhani.

The largest group in which the results of the company are consolidated is that headed up by Saffronland

Investments Limited. The group accounts are available to the public and may be obtained from the Registrar of

Companies.