GRAMMONT_PROPERTIES_LIMIT - 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.

Grammont Properties Limited is a private company limited by shares incorporated in England and Wales. The registered office is Acre House, 11-15 William Road, London, United Kingdom, NW1 3ER.

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 directors have considered the effect on the Company’s activities of the current global challenges including the UK recession, rising interest rates and rising cost of living. The directors have determined that a degree of uncertainty exists in relation to the ability of the company's tenants to fulfil their rental and other obligations, however the directors have been in contact with tenants and are of the opinion that the majority of rents for the foreseeable future will be received. To date, the company has not experienced significant difficulties in receiving rental amounts due from tenants.true

The company has significant net current liabilities which arise as a result of amounts owed to group undertakings. The directors have confirmed that related entities will not recall the amounts owed until the company is able to meet its current liability obligations.  

Accordingly, at the time of approving the financial statements, the directors have a reasonable expectation that the Company has adequate resources to continue in operation for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover represents rental income, property insurance premiums, service charges receivable and dilapidations receivable excluding value added tax.

Recognition of rental income takes into account the terms of the lease including any lease incentives which are spread over the length of the lease.

Property insurance premiums and service charges receivable are recognised over the period it relates to. Where the tenant pays in advance, the company defers that amount and recognises it as turnover over the period it relates to on a straight line basis.

Where the right to consideration arises from the occurrence of a critical event the turnover is recognised when the event occurs.

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 gain or loss on valuation is recognised in profit or loss and is subsequently transferred within equity to the "investment property reserve" together with the associated deferred tax.

Interests in subsidiaries are measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

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.

Financial assets are assessed for indicators of impairment at each reporting end date.

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 and non bank loans, 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 payments 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.

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 deferred tax.

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.

Investment property reserve

The investment property reserve comprises the fair value uplift on the company's investment property net of the associated deferred tax. Any movement in the fair value of the investment property and/or the deferred tax associated with it during the year is transferred from the profit and loss account into this reserve as a reserve movement in the Statement of Changes in Equity. This reserve is non-distributable.

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.

Investment properties are stated at fair value with changes in fair value being recognised in the profit and loss account. The directors have determined the fair value of the investment properties as at 31 March 2022 from a desktop review performed by management. The review has been informed by the last independent valuation conducted by Chartered Surveyors in July 2020, recent discussions held with an independent firm of Chartered Surveyors and the directors own knowledge of the market. The fair value was calculated by reference to rental yields applied against rental values at the year end and with consideration of the current, region specific, market activity and conditions. There is significant judgement involved in arriving at the fair value of the properties.

Deferred tax has been recognised on the investment property based on the estimated fair value at the year-end date.

There were 0 employees during the year or previous year.

The fair value of the investment properties has been arrived at from managements desktop review performed at the year end. This review was arrived at on the basis of the rental income as at 31 March 2022 from existing tenancies compared to the yields on the valuation carried out in July 2020, and based on recent market transactions.

The historic cost of the investment properties held by the company as at 31 March 2022 is £28,549,236 (2021: £28,211,803).

GP2 (UK) Limited was wound up on 8 June 2021.

Included within other debtors is £1,741,605 (2021: £1,674,769) owed to an LLP in which this company is a designated member. This amount is unsecured, interest free and payable on demand.

In the prior year, amounts owed to group undertakings of £4,626,054 were included within other creditors. These balances have been restated this year.

Amounts due to group undertakings are unsecured, interest free and repayable on demand.

The maturity date of the non bank loans is 17 September 2025. After the refinancing, the company had non bank loans principal of £23,224,435. As at 31 March 2022, the loan had a net carrying value £22,715,392 (2021: £22,575,941) after amortised transaction costs. The loan is secured by a legal charge over certain assets of the company. Interest is payable quarterly at an interest rate of 2.7% per annum. The principal amount of the non bank loans is repaid on maturity.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

As the profit and loss account 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.

The company has given cross party guarantees with group and related entities for non bank loans provided to these entities. At the balance sheet date, the non bank loan principal owed to lenders by these related entities for the non bank loans was £15,275,595 (2021: £15,275,595).