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Company Registration Number 02647301
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CHARTWELL TRAVEL LTD
REGISTERED NUMBER: 02647301
BALANCE SHEET
AS AT 31 DECEMBER 2019
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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Page 1
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CHARTWELL TRAVEL LTD
REGISTERED NUMBER: 02647301
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2019
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 3 to 12 form part of these financial statements.
Page 2
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
Chartwell Travel Limited is a private company, limited by shares, incorporated in England and Wales. The company's registered number is 02647301 and the registered address is 1st Floor, 15 Little Portland Street, London, W1W 8BW.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
The following principal accounting policies have been applied:
In preparing these financial statements, the directors of the company have given careful consideration to current and anticipated future solvency requirements of the company and its ability to continue as a going concern for the foreseeable future. The directors have prepared the financial statements on a going concern basis, notwithstanding the COVID-19 virus. The directors have prepared cash flow forecasts for a period beyond 12 months from the date of approval of these financial statements which indicate that, taking account of reasonably possible downturns, the company will have sufficient funds, through its operating cash flows, cash reserves and banking facilities to meet its liabilities as they fall due for that period.
The Company is subject to risks and uncertainties as a result of the COVID-19 pandemic. The impact of COVID-19 has caused material declines in demand within the travel, hospitality, restaurant and leisure industry concurrent with travel bans and increased governmental restrictions and mandates globally which has dampened consumer demand for our services. This decline has adversely and materially affected our business, the results of our operations and financial condition subsequent to the end of the year date. The directors believe the travel industry and our business will continue to be adversely and materially affected while travel bans and other government restrictions and mandates remain in place. However, the extent of the impact of the COVID-19 pandemic on our business is highly uncertain and difficult to predict, as the response to the pandemic is on-going, information is rapidly evolving, and the duration and severity of the pandemic are also uncertain and cannot be predicted. In addition, the directors do not have visibility into when these bans will be lifted, nor do they have visibility into the changes to consumer usage patterns on its platform or travel behaviour patterns when travel bans and other government restrictions and mandates are lifted.
Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that it could cause a local and/or global economic recession. Such economic disruption could have a material adverse effect on our business as consumers reduce their discretionary spending. Policymakers around the globe have responded with fiscal policy actions to support certain areas of the travel industry and economy as a whole. The magnitude and overall effectiveness of these actions remains uncertain.
The Company's future results of operations and liquidity could also be adversely impacted by delays in payments of outstanding accounts receivable amounts beyond normal payment terms, travel supplier and hotel insolvencies, and the impact of any initiatives or programs that the Company may undertake to address financial and operational challenges faced by us and our customers. As of the date of issuance of these financial statements, the extent to which the COVID-19 pandemic may materially impact the Company's financial condition, liquidity, or results of operations in the future is uncertain.
Page 3
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
2.Accounting policies (continued)
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Going concern (continued)
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The Company's responses with respect to this situation are as follows:
1. The company has applied for and been awarded a Coronavirus Business Interruption Loan (CBILS) to the sum of £250K;
2. As at August 2020 the company has cash at bank and in hand in excess of £880K;
3. Staff have agreed to the temporary postponement of on-going bonuses to a time where trade resumes to pre-covid levels;
4. The company has entered into consultation and are giving consideration with regards to the requirement and impact of redundancies; &
5. Through July & August 2020 the company has begun to generate revenues again and expects this to continue for the foreseeable future.
Based on the above, the directors believe it remains appropriate to prepare the financial statements on a going concern basis. However, the circumstances surrounding COVID-19 represent a material uncertainty that may cast a doubt on the entity’s ability to continue as a going concern and therefore to continue to realise its assets and discharging of its liabilities in the normal course of business. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Income and Retained Earnings except when deferred in other comprehensive income as qualifying cash flow hedges.
Page 4
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to the Statement of Income and Retained Earnings on a straight line basis over the lease term.
The Company has taken advantage of the optional exemption available on transition to FRS 102 which allows lease incentives on leases entered into before the date of transition to the standard 01 March 2018 to continue to be charged over the period to the first market rent review rather than the term of the lease.
Interest income is recognised in the Statement of Income and Retained Earnings using the effective interest method.
Finance costs are charged to the Statement of Income and Retained Earnings over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Income and Retained Earnings when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.
Page 5
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the period comprises current and deferred tax. Tax is recognised in the Statement of Income and Retained Earnings, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
The estimated useful lives range as follows:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Income and Retained Earnings.
Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Statement of Income and Retained Earnings for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.
Page 6
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
2.Accounting policies (continued)
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to the Statement of Income and Retained Earnings in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Investments in non-derivative instruments that are equity to the issuer are measured:
∙at fair value with changes recognised in the Statement of Income and Retained Earnings if the shares are publicly traded or their fair value can otherwise be measured reliably;
∙at cost less impairment for all other investments.
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The Company has taken advantage of the exemption not to disclose amounts paid for non audit services as these are disclosed in the group accounts of the parent Company.
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The average monthly number of employees, including directors, during the period was 16 (2018 - 13).
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Page 7
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
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Charge for the period on owned assets
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Other fixed asset investments
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Due after more than one year
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Page 8
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
7.Debtors (continued)
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Amounts owed by group undertakings
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Prepayments and accrued income
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Charged to profit or loss
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Page 9
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
10.Deferred taxation (continued)
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Short term timing differences
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Allotted, called up and fully paid
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72,000 (2018 - 72,000) Ordinary Shares shares of £1 each
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8,000 (2018 - 8,000) A Ordinary Shares shares of £1 each
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All shares rank equally in regard to voting and income. On a return of capital on winding up the company the A shareholders shall have no entitlement to payments until amounts paid up to Ordinary shares and any dividends declared in advance of the winding up on Ordinary shares have been paid.
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Share premium account
The share premium reserve contains the premium arising on issue of equity shares, net of issue expenses.
Profit and loss account
The profit and loss account comprises of accumulated profits and losses of the company.
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £18,369 (2018 - £10,659).
Contributions owed to the fund at year end amounted to £3,373 (2018: £nil).
Page 10
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
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Commitments under operating leases
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At 31 December 2019 the Company had future minimum lease payments under non-cancellable operating leases as follows:
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Later than 1 year and not later than 5 years
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Related party transactions
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The company has taken advantage of the exemption, under the terms of Financial Reporting 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.
A director purchased tickets amounting to £3,605 (2018: £785) during the period and owed the company £943 (2018: £785) at period end.
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Post balance sheet events
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The preparation of these financial statements does not include any adjustments that may be required as a consequence of the COVID-19 pandemic outbreak during March 2020. At the date of signing of the financial statements, the consequences of COVID-19 on the company and the financial statements are subject to a high level of estimation uncertainty and these financial statements therefore do not include any such adjustment.
The company is wholly owned by Ovation Travel Group UK Limited a company registered in England. The company registration number is 11380723. The results of the company are consolidated with those of the parent company and the consolidated accounts can be obtained at the parent company registered office being 15, 1st Floor, Little Portland Street, London, England, W1W 8BW.
The ultimate parent of the company is Ovation Travel Group Inc. a company registered in the United States of America. The results of the company are consolidated with those of the ultimate parent company and the consolidated accounts can be obtained at 71 Fifth Avenue, New York, NY, 10003-3004, United States.
The ultimate controlling party is Paul Metselaar through virtue of his shareholding in Ovation Travel Group Inc.
Page 11
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CHARTWELL TRAVEL LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
The auditors' report on the financial statements for the period ended 31 December 2019 was unqualified.
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In their report, the auditors emphasised the following matter without qualifying their report:
We draw attention to note 2.2 in the financial statements, which indicates that whilst the Directors believe they have sufficient funds to meet liabilities as they fall due, the presence of COVID-19 presents uncertainties in the amount and timing of future revenue and cash collections. These conditions indicate that a material uncertainty exists which may cast significant doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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The audit report was signed on 27 August 2020 by Martin Johnston CA (Senior Statutory Auditor) on behalf of Armstrong Watson Audit Limited.
Page 12
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