Quality Care (EM) Limited - Period Ending 2019-12-31
Quality Care (EM) Limited - Period Ending 2019-12-31
Registration number:
Quality Care (EM) Limited
for the Year Ended 31 December 2019
Quality Care (EM) Limited
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Independent Auditor's Report |
|
Profit and Loss Account |
|
Statement of Comprehensive Income |
|
Balance Sheet |
|
Statement of Changes in Equity |
|
Notes to the Financial Statements |
Quality Care (EM) Limited
Company Information
Directors |
J J Rankin T C Nathudkhan |
Company secretary |
L D Cotterill |
Registered office |
|
Auditors |
|
Quality Care (EM) Limited
Strategic Report for the Year Ended 31 December 2019
The directors present their strategic report for the year ended 31 December 2019.
Fair review of the business
The results of the company for the period ended 31 December 2019 are set out on pages 10 to 13.
The directors aim to present a balanced and comprehensive review of the development and performance of the company during the year and its position at the year end. The review is consistent with the size and nature of the company and is written in the context of the potential risks and uncertainties being faced.
2019 has continued to see change in the business, and the directors are satisfied with the performance under the circumstances. The pressure of increased operational costs continues and has seen increases, particularly in relation to the National Minimum Wage that are significantly greater than the increases in funding rates.
This year saw the first full year of Baden Powell operating a supported living care regime following the change during the previous year. The change has been successful and is now operating well after the period of adapting to the new structure.
The remaining group locations continue to deliver residential care provision to residents with a range of needs including Autistic Spectrum Disorder, Learning Disabilities and Aggressive behavior.
This year also saw the freehold properties being transferred to the Parent company, QCH (Holdings) Ltd, along with the associated bank finance. Quality Care (EM) Ltd now pays rent to the Parent company in order to fund that company making the payments on the bank loan.
The directors are satisfied that the company is in a strong position at the balance sheet date, and well placed to take advantage of any development opportunities that may arise. The reserves at the company year-end have reduced from the previous year in connection with the transfer of properties to the parent company. However, reserves on a Group basis are in line with the previous year. The company’s excellent relationship with its bankers continues, and the company has a strong cash and liquidity position at the balance sheet date.
The company's key financial and other performance indicators during the year were as follows:
Unit |
2019 |
2018 |
|
Turnover |
£,000 |
7,017 |
7,667 |
Gross profit margin |
% |
26 |
28 |
Non-financial key performance indicators:
The Care Quality Commission ratings are our key non-financial indicator. All homes have a good or outstanding rating except for The Hollies, which has made significant improvements since receiving a rating of “requires improvement”, and is now awaiting a revised improved rating in the near future.
Since the balance sheet date, the company has been significantly affected by Covid-19. The company took an early decision to lock down our locations well ahead of Government guidance. To date, none of our locations have had any positive cases of Covid-19. Difficulties accessing PPE, the cost of PPE, and the lack of any positive support, guidance or clarity from the Government has had a significant financial impact on the company in 2020.
Quality Care (EM) Limited
Strategic Report for the Year Ended 31 December 2019
Principal risks and uncertainties
The key risk in the immediate future is Covid-19, as we continue to work through this situation. The company is dealing with this situation exceptionally well at present, but difficulties highlighted in the commentary above continue in relation to PPE and lack of any positive Government support.
For the longer term the continued pressure of increased operating costs at much higher levels than the increases in funding rates is the most significant risk. The company is mitigating this risk by controlling costs as carefully as possible and maintaining a strong cash and liquidity position, as well as ensuring excellent care is provided in the homes.
Approved by the
Director
Quality Care (EM) Limited
Directors' Report for the Year Ended 31 December 2019
The directors present their report and the financial statements for the year ended 31 December 2019.
Directors of the company
The directors who held office during the year were as follows:
Statement of directors responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report 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 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.
Principal activity
The principal activity of the company is to deliver supporting residential services for individuals aged between 16 and 65 who have a range of profound needs which are predominantly involved with the Autistic Spectrum Disorder, Learning Disability and Aggressive Challenging Behaviour.
Quality Care (EM) Limited
Directors' Report for the Year Ended 31 December 2019
Financial instruments
Objectives and policies
The company’s activities expose it to a number of financial risks. The directors have overall responsibility for the establishment and oversight of the Company's risk management framework.
The exposure to these risks are monitored by the Board of Directors as part of its daily management of the Company's activities.
Price risk, credit risk, liquidity risk and cash flow risk
The company’s principal financial instruments comprise bank balances and overdrafts, bank loans, trade debtors, trade creditors and finance lease agreements. The main purpose of these instruments is to finance the group's operations.
Credit risk:
The company's credit risk is primarily attributed to its trade receivables. These are managed by ensuring policies concerning the credit offered to customers are monitored and also the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of specific allowances for doubtful debtors.
Liquidity risk:
The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense whilst ensuring that the company has sufficient liquid resources to meet the operating needs of the business.
Interest rate risk:
The interest rates on loans from financial institutions are at variable rates. The cash flow interest rate risk is managed by the company within its business projections and planning and in the monitoring of financial covenants and through the negotiation of facility terms with the providers of the loans.
Employment of disabled persons
The company's policy is to recruit disabled workers for those vacancies that they are able to fill. All necessary assistance with initial training courses is given. Once employed, a career plan is developed so as to ensure suitable opportunities for each disabled person. Arrangements are made, wherever possible, for retraining employees who become disabled, to enable them to perform work identified as appropriate to their aptitudes and abilities.
Employee involvement
The company's policy is to consult and discuss with employees, staff councils and at meetings, matters likely to affect employees' interests. Information regarding matters of concern to employees is provided through information bulletins/reports.
Quality Care (EM) Limited
Directors' Report for the Year Ended 31 December 2019
Disclosure of information to the auditors
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.
Approved by the
Director
Quality Care (EM) Limited
Independent Auditor's Report to the Members of Quality Care (EM) Limited
Opinion
We have audited the financial statements of Quality Care (EM) Limited (the 'company') for the year ended 31 December 2019, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, and 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).
In our opinion the financial statements:
• | give a true and fair view of the state of the company's affairs as at 31 December 2019 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 Auditor’s 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 included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, 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 we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Quality Care (EM) Limited
Independent Auditor's Report to the Members of Quality Care (EM) Limited
Opinion on other matter 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
• |
the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report.
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 4], 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 is 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.
Auditor’s 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 an auditor’s report 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.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
• |
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. |
Quality Care (EM) Limited
Independent Auditor's Report to the Members of Quality Care (EM) Limited
• |
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. |
• |
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. |
• |
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. |
• |
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. |
• |
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the company audit. We remain solely responsible for our audit opinion. |
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Use of our report
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 an auditor’s report 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.
For and on behalf of
5 Prospect Place
Millennium Way
Pride Park
DE24 8HG
Quality Care (EM) Limited
Profit and Loss Account for the Year Ended 31 December 2019
Note |
2019 |
2018 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Other operating income |
|
|
|
Operating profit |
|
|
|
Other interest receivable and similar income |
|
|
|
Interest payable and similar charges |
( |
( |
|
(118,719) |
(165,367) |
||
Profit before tax |
|
|
|
Taxation |
|
( |
|
Profit for the financial year |
|
|
The company has no recognised gains or losses for the year other than the results above.
Quality Care (EM) Limited
Statement of Comprehensive Income for the Year Ended 31 December 2019
2019 |
2018 |
|
Profit for the year |
|
|
Surplus/(deficit) on property, plant and equipment revaluation |
- |
|
Total comprehensive income for the year |
|
|
The net surplus/(deficit) on property, plant and equipment revaluations noted above is after a deferred tax (charge)/credit for the year of £Nil (2018 - £8,156).
Quality Care (EM) Limited
(Registration number: 04651403)
Balance Sheet as at 31 December 2019
Note |
2019 |
2018 |
|
Fixed assets |
|||
Tangible assets |
|
|
|
Current assets |
|||
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets/(liabilities) |
|
( |
|
Total assets less current liabilities |
|
|
|
Provisions for liabilities |
- |
( |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
|
|
|
Fair value and revaluation reserve |
- |
|
|
Profit and loss account |
|
|
|
Total equity |
|
|
Approved and authorised by the
Director
Quality Care (EM) Limited
Statement of Changes in Equity for the Year Ended 31 December 2019
Share capital |
Fair value and revaluation reserve |
Profit and loss account |
Total |
|
At 1 January 2019 |
|
|
|
|
Profit for the year |
- |
- |
|
|
Total comprehensive income |
- |
- |
|
|
Dividends |
- |
- |
( |
( |
Transfer between reserves |
- |
(3,069,394) |
3,069,394 |
- |
At 31 December 2019 |
|
- |
|
|
Share capital |
Fair value and revaluation reserve |
Profit and loss account |
Total |
|
At 1 January 2018 |
|
|
|
|
Profit for the year |
- |
- |
|
|
Other comprehensive income |
- |
|
- |
|
Total comprehensive income |
- |
|
|
|
Dividends |
- |
- |
( |
( |
Transfer between reserves |
- |
(2,130) |
2,130 |
- |
Transfers of realised profit |
- |
(41,434) |
41,434 |
- |
At 31 December 2018 |
|
|
|
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
General information |
The company is a private company limited by share capital, incorporated in England.
The address of the registered office is given in the company information on page 1 of these financial statements.
The principal place of business is:
The Baden Powell Centre
Victoria Street
Chesterfield
S41 7LP
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 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' ('FRS102'), and the Companies Act 2006.
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 financial statements are presented in Sterling (£) and rounded to the nearest £1.
Summary of disclosure exemptions
The company meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it in respect of its finacial statements. Exemptions have been taken in relation to presentation of a cash flow statement and remuneration of key management personnel..
Going concern
The emergence of the global pandemic known as Covid-19 has raised significant uncertainty throughout the UK economy since the balance sheet date. The Directors have assessed a potential range of impacts that this pandemic may have on the Company.
Consideration has been given to the risks of reduced turnover, slow payment or non-payment of debts, the value of stock and other assets owned by the group. Detailed financial models have been prepared, which continue to be monitored and updated, and plans have been put in place to ensure there are sufficient reserves to continue into the future.
Having assessed all available information at the date of approving the accounts, the Directors are confident that the business is well placed to manage the situation and to continue trading as a going concern.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised in the period in which the estimate is revised, if the revision only affects that period, or in the period of revision and future period if the revision affects both the current and future periods.
The estimates and assumptions which have risk of causing material adjustment to the carrying amount of assets and liabilities are set out below:
Freehold land and buildings:
These represent a significant proportion of the asset base of the company and hence estimates and assumptions made in determining their carrying value are significant to the business. The depreciation charge is derived after determining an estimate of an assets useful life and residual value at the end of its life. The useful lives and residual values for the company's assets are determined by management at the time the asset is acquired and reviewed annually for appropriateness. The useful lives are based on historical experience with similar assets.
Valuation of investment properties:
These valuations rely on a number of estimations and assumptions being made in relation to market conditions and developments
Impairment of debtors
On a periodic basis management makes an estimation of the recoverability of debtors. Management make such estimations based on the ageing profile, and historical experience.
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 sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.
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.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
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 difference. Deferred tax on revalued non-depreciable tangible fixed assets and investment properties is measured using the rates and allowances that apply to the sale of the asset.
Tangible assets
Tangible assets are stated in the statement of financial position at cost or valuation, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
The fair value of freehold land and buildings is determined from market-based evidence by appraisal that is undertaken by professionally qualified valuers. For further details of the latest valuation see note 13.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction, over their estimated useful lives as follows:
Asset class |
Depreciation method and rate |
Freehold property |
2% on cost |
Freehold land |
Not depreciated |
Motor vehicles |
25% on reducing balance |
Furniture, fittings and equipment |
25% on reducing balance |
Investment property
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Hire purchase and leasing
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
The aggregate benefit of lease incentives are recognised as a reduction to the expense recognised over the lease term on a straight line basis.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under hire purchase contracts or finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the Balance Sheet as a finance lease obligation.
Lease payments are apportioned between finance costs in the Profit and Loss Account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as an employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability in the balance sheet. The corresponding dividends relating to the liability component are charged as interest expense in the profit and loss account.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Revenue |
The analysis of the company's revenue for the year from continuing operations is as follows:
2019 |
2018 |
|
Fees received |
|
|
Other operating income |
The analysis of the company's other operating income for the year is as follows:
2019 |
2018 |
|
Miscellaneous other operating income |
|
|
Operating profit |
Arrived at after charging/(crediting)
2019 |
2018 |
|
Depreciation expense |
|
|
Loss on disposal of tangible fixed assets |
|
|
Other interest receivable and similar income |
2019 |
2018 |
|
Other finance income |
|
|
Interest payable and similar expenses |
2019 |
2018 |
|
Interest on bank overdrafts and borrowings |
|
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2019 |
2018 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
|
|
The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:
2019 |
2018 |
|
Carers |
|
|
Administrative wages |
|
|
Directors |
|
|
Management |
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
2019 |
2018 |
|
Remuneration |
|
|
Contributions paid to money purchase schemes |
|
|
Compensation for loss of office |
- |
|
91,291 |
144,791 |
During the year the number of directors who were receiving benefits and share incentives was as follows:
2019 |
2018 |
|
Accruing benefits under money purchase pension scheme |
|
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Auditors' remuneration |
2019 |
2018 |
|
Audit of the financial statements |
|
|
Taxation |
Tax charged/(credited) in the income statement
2019 |
2018 |
|
Current taxation |
||
UK corporation tax |
|
|
UK corporation tax adjustment to prior periods |
( |
( |
60,762 |
86,735 |
|
Deferred taxation |
||
Arising from origination and reversal of timing differences |
( |
( |
Arising from changes in tax rates and laws |
- |
|
Total deferred taxation |
( |
|
Tax (receipt)/expense in the income statement |
( |
|
The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2018 - the same as the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2019 |
2018 |
|
Profit before tax |
|
|
Corporation tax at standard rate |
|
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
Tax increase (decrease) from effect of capital allowances and depreciation |
|
|
Tax increase (decrease) arising from group relief |
- |
( |
Increase (decrease) in current tax from adjustment for prior periods |
( |
( |
UK deferred tax expense (credit) for the year |
( |
( |
Deferred tax expense (credit) relating to changes in tax rates or laws |
- |
|
Total tax (credit)/charge |
( |
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Deferred tax
Deferred tax assets and liabilities
2019 |
Asset |
Asset/liability due to accelerated capital allowances |
|
Liability in respect of revalued fixed assets above cost |
- |
Asset in respect of revalued fixed assets below cost |
- |
|
2018 |
Asset |
Liability |
Asset/liability due to accelerated capital allowances |
- |
|
Liability in respect of revalued fixed assets above cost |
- |
|
Asset in respect of revalued fixed assets below cost |
|
- |
|
|
The deferred tax in relation to land and buildings held at valuation has been calculated on the basis that they were all sold as an operating business at the values included in the financial statements. On that basis deferred tax assets have been recognised to the extent that they could be recovered or reversed against liabilities. On the basis that should such a sale take place such tax liabilities would be settled on a net basis the deferred tax assets and liabilities are shown in the balance sheet at their net position.
The amount of the net reversal of deferred tax assets and deferred tax liabilities expected to occur during the year beginning after the reporting period is £(7,436) (2018 - £28,145).
Tax relating to items recognised in other comprehensive income or equity
2019 |
2018 |
|
Deferred tax related to items recognised as items of other comprehensive income |
- |
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Tangible assets |
Freehold land and buildings |
Furniture, fittings and equipment |
Motor vehicles |
Total |
|
Cost or valuation |
||||
At 1 January 2019 |
|
|
|
|
Additions |
|
|
- |
|
Disposals |
- |
( |
( |
( |
Transferred to parent company |
(12,107,225) |
- |
- |
(12,107,225) |
At 31 December 2019 |
- |
|
|
|
Depreciation |
||||
At 1 January 2019 |
|
|
|
|
Charge for the year |
|
|
|
|
Eliminated on disposal |
- |
( |
( |
( |
Transferred to parent company |
( |
- |
- |
( |
At 31 December 2019 |
- |
|
|
|
Carrying amount |
||||
At 31 December 2019 |
- |
|
|
|
At 31 December 2018 |
|
|
|
|
Included in cost of land and buildings is freehold land of £Nil (2018 - £2,748,000) which is not depreciated.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Revaluation
The land and buildings have been transferred to the parent company during the year.
The fair value of the land and buildings included in the company’s freehold properties were reviewed by the directors, these were determined by carrying out a review of the properties and were further supported by independent valuations carried out in August 2017 and April 2016 in accordance with RICS. The valuers are registered in accordance with the RICS Valuer Registration Scheme. These properties were valued at the balance sheet date at £nil (2018 - £11,541,010).
This class of assets has a carrying amount at historical cost of £nil (2018 - £8,835,683). The depreciation charge based on this historical cost would be £nil (2018 - £144,138).
Freehold land and buildings with a net book value of £nil (2018 - £11,541,010) have been pledged as security for liabilities of the company.
Debtors |
Note |
2019 |
2018 |
|
Trade debtors |
|
|
|
Amounts owed by group undertakings |
|
|
|
Other debtors |
|
|
|
Prepayments |
|
|
|
Deferred tax asset |
|
- |
|
|
|
Creditors |
Note |
2019 |
2018 |
|
Due within one year |
|||
Loans and borrowings |
- |
|
|
Trade creditors |
|
|
|
Social security and other taxes |
|
|
|
Other creditors |
|
|
|
Accrued expenses |
|
|
|
Corporation tax |
60,933 |
100,686 |
|
Payments on account |
|
|
|
|
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Deferred tax and other provisions |
Deferred tax |
|
At 1 January 2019 |
|
Increase (decrease) in existing provisions - charge (credit) to profit and loss |
( |
Increase (decrease) through transfer to parent company |
( |
At 31 December 2019 |
( |
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £
Share capital |
Allotted, called up and fully paid shares
2019 |
2018 |
|||
No. |
£ |
No. |
£ |
|
|
|
200 |
|
200 |
Rights, preferences and restrictions
Ordinary shares have the following rights, preferences and restrictions: |
Reserves |
Profit and loss account
The profit and loss account represents cumulative profits and losses net of dividends and other adjustments.
Revaluation reserve
Comprises revaluation differences arising from the revaluation of certain assets of the company.
Fair value reserve
The fair value reserve represents the cumulative gains and impairments in relation to the company's non-current assets which are carried at fair value. The reserve also encompasses any deferred taxation movements on such gains.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Loans and borrowings |
2019 |
2018 |
|
Current loans and borrowings |
||
Bank borrowings |
- |
|
Bank borrowings
In prior years the company's bank borrowings were secured by a fixed and floating charge over the assets of the company. There was also a charge over the company's freehold land and buildings. However due to the land and buildings being transferred into the parent company during the year the loan was also transferred. The |
Obligations under leases and hire purchase contracts |
Operating leases
The total of future minimum lease payments is as follows:
2019 |
2018 |
|
Not later than one year |
|
|
Later than one year and not later than five years |
|
|
Later than five years |
- |
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
Contingent liabilities |
The company has entered into cross guarantees with its finance providers in respect of the liabilities of the group companies. This is supported by a debenture over the company's assets. The contingent liability at the balance sheet date is £5,235,100 (2018 - £nil). The future outcome is dependent upon the performance of individual companies concerned however the directors do not expect any liability to crystalise.
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Related party transactions |
Transactions with directors |
2019 |
At 1 January 2019 |
Advances to directors |
Repayments by directors |
Other payments made to company by directors |
At 31 December 2019 |
Interest free loan repayable on demand |
- |
( |
- |
- |
( |
Dividends paid to directors |
2019 |
2018 |
|||
Dividends paid |
- |
33,600 |
||
Companies with common directors and/or common shareholders:
Summary of transactions with other related parties
At the balance sheet date the amount owed to directors amounted to £49,109 (2018 - £50,583), this was provided interest free and is repayable to the directors on demand.
The company has taken advantage of the exemption available under FRS 102 from disclosing transactions with entities that are part of the same group.
Income and receivables from related parties
2019 |
Other related parties |
Management charges |
|
Amounts receivable from related party |
|
2018 |
Other related parties |
Recharge of expenses |
|
Amounts receivable from related party |
|
Quality Care (EM) Limited
Notes to the Financial Statements for the Year Ended 31 December 2019
Expenditure with and payables to related parties
2019 |
Other related parties |
Professional services |
|
Management charges |
|
Intercompany write off |
|
|
|
Amounts payable to related party |
|
2018 |
Other related parties |
Professional services |
|
Rendering of services |
|
Purchase of property or other assets |
|
|
|
Amounts payable to related party |
|
Parent and ultimate parent undertaking |
The company's immediate parent is QCH (Holdings) Limited, incorporated in England.
Relationship between entity and parents
The parent of the smallest and largest group in which these financial statements are consolidated is QCH (Holdings) Limited, incorporated in England.
The address of QCH (Holdings) Limited is:
5 Prospect Place, Millennium Way, Pride Park, Derby, DE24 8HG.
These financial statements are available on request from Companies House, Crown Way, Maindy, Cardiff, CF14 3UZ.
Non adjusting events after the financial period |
|