Company Registration No. 03422748 (England and Wales)
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2018
PAGES FOR FILING WITH REGISTRAR
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
CONTENTS
Page
Statement of financial position
1
Statement of changes in equity
2
Notes to the financial statements
3 - 7
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
STATEMENT OF FINANCIAL POSITION
AS AT
31 AUGUST 2018
31 August 2018
- 1 -
2018
2017
Notes
£
£
£
£
Fixed assets
Property, plant and equipment
4
83,419
106,140
Current assets
Trade and other receivables
5
41,095
61,680
Cash and cash equivalents
32,229
58,780
73,324
120,460
Current liabilities
6
(154,531)
(176,737)
Net current liabilities
(81,207)
(56,277)
Total assets less current liabilities
2,212
49,863
Equity
Retained earnings
2,212
49,863
The directors of the company have elected not to include a copy of the income statement 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.
The financial statements were approved by the board of directors and authorised for issue on 26 July 2019 and are signed on its behalf by:
Mark McLaughlin
Director
Company Registration No. 03422748
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2018
- 2 -
Retained earnings
Notes
£
Balance at 1 April 2016
569,572
Period ended 31 August 2017:
Profit and total comprehensive income for the period
272,629
Distributions to parent charity under gift aid
3
(792,338)
Balance at 31 August 2017
49,863
Period ended 31 August 2018:
Loss and total comprehensive income for the period
(7,651)
Distributions to parent charity under gift aid
3
(40,000)
Balance at 31 August 2018
2,212
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2018
- 3 -
1
Accounting policies
Company information
London Horizons Limited is a
private
company
limited by guarantee
incorporated in England and Wales.
The registered office is
Hackford Road, Stockwell, London, SW9 0RD.
1.1
Accounting convention
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 a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The company uses properties owned by the Durand Education Trust (DET) at Hackford Road, London SW9 to operate its business activities. On 22 May 2019, the Secretary of State (SoS) issued a direction to DET requiring it to transfer these assets to the Local Authority by 1 January 2020. If the assets are transferred, it is possible that the Company’s permitted use of the properties will be terminated and the company will have to cease its current activities. Whilst the trustees of DET acknowledge the direction from the SOS they have taken legal advice throughout and they continue to challenge the position of the SoS. The legal argument will necessarily take some time to resolve. The Directors of LHL are reassured by the position of the trustees of DET and are therefore confident that the company will be able to continue its activities for the foreseeable future. Therefore, the Directors continue to adopt a going concern basis in preparing these accounts.
true
1.3
Reporting period
The prior reporting period was 17 months. A change of the accounting reference date was made in order for the company to align its year end with its parent company, Durand Education Trust. As a result the
comparative amounts presented in the financial statements (including
the related notes) are not entirely comparable.
1.4
Revenue
Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
The fair value of consideration takes into account trade discounts.
1.5
Property, plant and equipment
Property, plant and equipment
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Property improvements
7 years straight line basis
Fixtures, fittings & equipment
3 - 7 years straight line basis
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2018
1
Accounting policies
(Continued)
- 4 -
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
1.6
Impairment of non-current assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in
hand and
deposits held at call with banks
.
1.8
Financial instruments
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 statement of financial position 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
Basic financial assets, which include trade and other receivables 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.
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2018
1
Accounting policies
(Continued)
- 5 -
Classification of financial liabilities
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
Basic financial liabilities, including trade and other payables 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
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Trade payables
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts 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 payables are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
1.9
Taxation
Current tax
The
company donates all its taxable profits to the Durand Education Trust each year and as such, there is no liability to corporation tax.
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.
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 income statement, 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.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was 2 (2017 - 3
).
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2018
- 6 -
3
Dividends and distributions
2018
2017
£
£
Distributions to parent charity under gift aid
Amounts paid
40,000
792,338
4
Property, plant and equipment
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 September 2017
81,288
76,958
158,246
Additions
-
2,349
2,349
At 31 August 2018
81,288
79,307
160,595
Depreciation and impairment
At 1 September 2017
16,219
35,887
52,106
Depreciation charged in the year
11,612
13,458
25,070
At 31 August 2018
27,831
49,345
77,176
Carrying amount
At 31 August 2018
53,457
29,962
83,419
At 31 August 2017
65,069
41,071
106,140
5
Trade and other receivables
2018
2017
Amounts falling due within one year:
£
£
Trade receivables
13,249
16,979
Other receivables
27,846
44,701
41,095
61,680
6
Current liabilities
2018
2017
£
£
Trade payables
45,944
21,230
Other payables
108,587
155,507
154,531
176,737
LONDON HORIZONS LIMITED
A COMPANY LIMITED BY GUARANTEE AND HAVING NO SHARE CAPITAL
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2018
- 7 -
7
Audit report information
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.
Material uncertainty related to going concern
We draw attention to note 1.2 in the financial statements, which explains the company’s use of various properties owned by Durand Education Trust in order to operate its business activities and the possible termination of the company’s use of those properties. As stated in note 1.2, these circumstances indicate that a material uncertainty exists that 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.
The senior statutory auditor was Stephen Simou FCA.
The auditor was Citroen Wells.
8
Related party transactions
The directors who served during the
year
Philip Blair
and
Mark McLaughlin were also directors of Durand Education Trust ('DET'), a charitable company registered in England and Wales and the company's sole member. The company has use under an informal agreement of propert
ies
ow
n
ed by DET for which no charge is made by DET (201
7
: £Nil). During the
year
, the company made charitable donations to DET of £
40,000
(201
7
: £
792
,
338
). At the
year
end,
there were no outstanding balances between the company and DET.
The school sites at Hackford Road, London and in Midhurst, West Sussex, are owned by the Durand Education Trust (DET). DET is a company limited by
guarantee who is also a member of Durand Academy Trust (DAT)
. The sites
were
leased
by DET to DAT
informally
f
or a peppercorn rent
, Durand Academy Trust ceased to operate as an on 31 August 2018 after its Funding Agreement was terminated at that date. The former Durand Academy has been renamed Van Gogh Academy and is part of The Dunraven Educational Trust, a multi-academy trust. Durand Academy Trust is now referred to as the Predecessor on the government website.
During the
year
, the company invoiced DAT for the subsidies which it provided to DAT staff and parents on gym membership and staff accommodation and also for the swimming classes provided to pupils totalling £
79,895
(201
7
: £213,554) and was recharged expenses totalling £
19,729
(201
7
: £30,052). At the
year
end, £
404
(201
7
: £
17
,
799
) was owed by DAT to the company
.
Sir Gregory Martin
is part of the key management team.
GMG Educational Support (UK) Limited ('GMGES') and GMG Management Resource UK Limited ('GMGMR') are companies controlled by Sir Gregory Martin, who was also a director of DAT
until 31 August 2017
. During the
period
, GMGMR charged the company £
300,710
(201
7
: £
428,408
) for services provided and performance related management fees. On 1 December 2016, the company terminated the ‘agreement for services’ contract with GMGMR triggering termination fees of £850,000
of which
£
320,000
(201
7
:
£
405,000
)
was
charged in the year with a further £125,000 remaining to be charged in future periods.
At the year end, the company was indebted to GMGMR in the amount of £
59,466
(201
7
: £
107,232
). During the period, GMGES charged the company £
34,792
(201
7
: £
50,857
) for services provided.
At the year end, the company was indebted to GMG
ES
in the amount of £
27,621
(201
7
: £
414
).
9
Parent company
During the year, the company was under the ultimate control of its sole member,
Durand Education Trust
, a company incorporated in England and Wales, registered office
Hackford Road, Stockwell, London, SW9 0RD.