REGISTERED NUMBER:
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IPSWICH EDUCATION LIMITED |
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STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
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FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2019 |
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REGISTERED NUMBER:
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IPSWICH EDUCATION LIMITED |
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STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
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FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2019 |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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Page |
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Company Information | 1 |
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Strategic Report | 2 |
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Report of the Directors | 4 |
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Report of the Independent Auditors | 6 |
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Statement of Comprehensive Income | 8 |
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Statement of Financial Position | 9 |
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Statement of Changes in Equity | 10 |
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Statement of Cash Flows | 11 |
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Notes to the Statement of Cash Flows | 12 |
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Notes to the Financial Statements | 13 |
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IPSWICH EDUCATION LIMITED |
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COMPANY INFORMATION |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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DIRECTORS: |
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REGISTERED OFFICE: |
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REGISTERED NUMBER: |
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AUDITORS: |
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Chartered Certified Accountants |
and Statutory Auditors |
West Lodge |
Rainbow Street |
Leominster |
Herefordshire |
HR6 8DQ |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STRATEGIC REPORT |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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The directors present their strategic report for the year ended 31 August 2019. |
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REVIEW OF BUSINESS |
From the start of this year the school became co-educational as part of the restructuring. |
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The financial statements show a loss for the year of £2,180,064 from a turnover of £5,391,042. As at 31st August 2019 the |
company had net liabilities of £2,695,478. The directors consider these results to be as anticipated, losses are expected to |
continue during a period of restructuring. |
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The directors are closely monitoring the expected losses, analysing areas of expenditure where efficiencies can be made. |
Recruitment of students is critical in order to achieve the projected return to profits in 2022. From September 2019, boarding |
facilities are available, and are to be expanded, which will allow more students from further afield to attend the school and |
increase the overall number of students. |
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PRINCIPAL RISKS AND UNCERTAINTIES |
The key business risks and uncertainties affecting the company relate to recruitment levels of students, improving |
profitability, financing arrangements, and ongoing compliance with current and future legislation affecting the sector. |
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The Covid 19 pandemic has affected operations for independent schools and resulted in reduced income during the 2019/20 |
academic year. At this time, the directors are unable to assess with any certainty the full financial impact of the pandemic on |
the school. |
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GOING CONCERN BASIS OF ACCOUNTING |
In accordance with the Financial Reporting Council's 'Going Concern and Liquidity Risk: Guidance for Directors of UK |
Companies', the directors of all companies are now required to provide disclosures regarding the adoption of the going |
concern basis of accounting. |
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The company is expected to continue making losses in the periods to 31st August 2020 and 31st August 2021. |
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In order to finance the expected losses, an arrangement has been made with Ipswich International Education Group Ltd, |
whereby financial support will be provided. Ipswich Education Ltd is expected to return to profits in the period ending 31st |
August 2022. |
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Having considered all of the information available to them, the directors consider that there is a material uncertainty relating |
to these events and conditions, which may cast doubt on the entity's ability to continue as a going concern. However, given |
the arrangement in place with Ipswich International Education Group Limited, and the expectation of future profitability, |
they consider it appropriate to prepare the financial statements using the going concern basis. |
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FINANCIAL INSTRUMENTS |
The board constantly monitors the company's trading results and revises projections as appropriate to ensure that the |
company can meet its future obligations as they fall due. |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STRATEGIC REPORT |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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PRICE RISK, CREDIT RISK, LIQUIDITY RISK AND CASH FLOW RISK |
The company is exposed to the usual credit and cash flow risks associated with selling on credit, and manages this through |
credit control procedures. |
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ON BEHALF OF THE DIRECTORS: |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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The directors present their report with the financial statements of the company for the year ended 31 August 2019. |
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PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the provision of educational services. |
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DIVIDENDS |
No dividends will be distributed for the year ended 31 August 2019. |
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EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
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DIRECTORS |
Ms S Wang |
P M Newton |
J Yin |
Dr S D Tommis - appointed 18 September 2018 |
L Han - appointed 9 July 2019 |
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Ms X Lin, J Wang and H S Blyth were appointed as directors after 31 August 2019 but prior to the date of this report. |
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Dr S D Tommis, L Han, J Yin, PM Newton and Ms S Wang ceased to be directors after 31 August 2019 but prior to the date |
of this report. |
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STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in |
accordance with applicable law and regulations. |
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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), including Financial Reporting Standard 102 'The Financial |
Reporting Standard applicable in the UK and Republic of Ireland'. 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: |
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- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will
continue in business. |
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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. |
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STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act |
2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have |
taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the |
company's auditors are aware of that information. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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AUDITORS |
The auditors, Davies Edwards & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
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ON BEHALF OF THE DIRECTORS: |
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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
IPSWICH EDUCATION LIMITED |
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Opinion |
We have audited the financial statements of Ipswich Education Limited (the 'company') for the year ended 31 August 2019 |
which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, |
Statement of Cash Flows and Notes to the Statement of Cash Flows, 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). |
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In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 August 2019 and of its loss 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. |
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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 Auditors' 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. |
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Material uncertainty relating to going concern |
We draw attention to note 24 in the financial statements, which discusses the company's financial position. The company |
incurred a net loss of £2,180,064 during the year ended 30 August 2019 and the directors expectation is that future losses |
will be incurred, such that financial support will be required from the company's parent undertaking. As stated in note 24, |
these events or conditions indicate a material uncertainty exists that may cast 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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Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic |
Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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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. |
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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. |
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Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
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the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial
statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
IPSWICH EDUCATION LIMITED |
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Matters on which we are required to report by exception |
In the light of the 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 or the Report of the Directors. |
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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: |
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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. |
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Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 necessary to enable the preparation of financial statements that are free from material |
misstatement, whether due to fraud or error. |
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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. |
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Auditors' 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 a Report of the Auditors 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. |
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A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting |
Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
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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 a Report of the Auditors 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. |
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for and on behalf of
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Chartered Certified Accountants |
and Statutory Auditors |
West Lodge |
Rainbow Street |
Leominster |
Herefordshire |
HR6 8DQ |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STATEMENT OF COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
Notes | £ | £ |
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TURNOVER |
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Cost of sales |
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GROSS PROFIT |
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Administrative expenses |
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(1,885,873 | ) | (1,316,810 | ) |
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Other operating income |
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OPERATING LOSS | 4 | ( |
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Interest receivable and similar income |
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(1,764,317 | ) | (1,196,677 | ) |
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Interest payable and similar expenses | 6 |
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LOSS BEFORE TAXATION | ( |
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Tax on loss | 7 | ( |
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LOSS FOR THE FINANCIAL YEAR | ( |
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OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR |
( |
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( |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STATEMENT OF FINANCIAL POSITION |
31 AUGUST 2019 |
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2019 | 2018 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 8 |
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Tangible assets | 9 |
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CURRENT ASSETS |
Debtors | 10 |
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Cash at bank |
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CREDITORS |
Amounts falling due within one year | 11 |
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NET CURRENT LIABILITIES |
( |
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TOTAL ASSETS LESS CURRENT
LIABILITIES |
( |
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CREDITORS |
Amounts falling due after more than one year | 12 |
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( |
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PROVISIONS FOR LIABILITIES | 14 | ( |
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NET LIABILITIES | ( |
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CAPITAL AND RESERVES |
Called up share capital | 15 |
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Retained earnings | 16 | ( |
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SHAREHOLDERS' FUNDS | ( |
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The financial statements were approved by the Board of Directors and authorised for issue on
signed on its behalf by: |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
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Changes in equity |
Issue of share capital |
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Total comprehensive income | - | ( |
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Balance at 31 August 2018 |
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( |
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Changes in equity |
Total comprehensive income | - | ( |
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Balance at 31 August 2019 |
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( |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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STATEMENT OF CASH FLOWS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
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Interest paid | ( |
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Net cash from operating activities | ( |
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Cash flows from investing activities |
Purchase of intangible fixed assets |
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( |
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Purchase of tangible fixed assets | ( |
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Interest received |
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Net cash from investing activities | ( |
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Cash flows from financing activities |
New loans in year |
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Loan repayments in year | ( |
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Issue of preference shares |
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Bonds issued |
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Share issue |
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Net cash from financing activities |
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Increase in cash and cash equivalents |
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Cash and cash equivalents at beginning of
year |
2 |
278,880 |
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Cash and cash equivalents at end of year | 2 |
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IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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NOTES TO THE STATEMENT OF CASH FLOWS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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1. |
RECONCILIATION OF LOSS FOR THE FINANCIAL YEAR TO CASH GENERATED FROM
OPERATIONS |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Loss for the financial year | ( |
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Depreciation charges |
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Loss on disposal of fixed assets |
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Increase/(decrease) bad debt provision |
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Finance costs |
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Finance income | ( |
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Taxation | ( |
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(1,508,339 | ) | (956,675 | ) |
Decrease/(increase) in trade and other debtors |
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( |
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Increase in trade and other creditors |
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Cash generated from operations | ( |
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2. | CASH AND CASH EQUIVALENTS |
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The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these |
Statement of Financial Position amounts: |
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Year ended 31 August 2019 |
31/8/19 | 1/9/18 |
£ | £ |
Cash and cash equivalents |
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278,880 |
Period ended 31 August 2018 |
31/8/18 | 20/7/17 |
£ | £ |
Cash and cash equivalents | 278,880 | - |
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3. | ACQUISITION OF BUSINESS |
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During the previous year there was a significant cash outflow of £8,422,253 relating to the acquisition of the |
business, |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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1. | STATUTORY INFORMATION |
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Ipswich Education Limited is a
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registered number and registered office address can be found on the Company Information page. |
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The principle place of business is Woolverstone, Ipswich, IP9 1AZ. |
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2. | ACCOUNTING POLICIES |
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Basis of preparing the financial statements |
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Significant judgements and estimates |
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 that are considered to be |
relevant. Actual results may differ from these estimates. |
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The estimates and assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised |
in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision |
and future periods if the revision affects both current and future periods. |
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Turnover |
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 refunds, rebates, bursaries, scholarships and |
discounts, and is accounted for gross of VAT where applicable.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. |
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Goodwill |
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Goodwill is reviewed annually with regards to indications of impairment and after initial recognition, is measured at |
cost less accumulated amortisation and accumulated impairment losses. |
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Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less |
any accumulated amortisation and any accumulated impairment losses. |
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The directors have conducted an impairment review on the intangible fixed assets and while there is some |
uncertainty regarding the effects of covid-19, this cannot be reliably measured at present so consequently no |
provision has been made with regards to impairment losses. This will be reviewed again at the end of the next |
financial year. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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2. | ACCOUNTING POLICIES - continued |
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Tangible fixed assets |
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Freehold property | - |
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Plant and machinery | - |
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Motor vehicles | - |
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Computer equipment | - |
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The directors are of the opinion that the land and buildings should not be depreciated as the residual value of the |
property is not significantly lower than cost. |
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Tangible fixed assets are reviewed annually with regards to indications of impairment and after initial recognition are |
measured at cost less accumulated depreciation and accumulated impairment losses. |
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Financial instruments |
Classification |
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 lability of the company is presented as a liability on the balance sheet. The |
corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss |
account. |
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Recognition and measurement |
All financial assets and liabilities are initially measured at transaction price (including transactions costs), except for |
those financial assets classified as at fair value through profit and loss, which are initially measured at fair value |
(which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing |
transaction. If an arrangement constitutes a financing transaction, the financial assets of financial liability is |
measured at the present value of the future payments discounted at a market rate of interest for a similar debt |
instrument. |
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Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive |
Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
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Current or deferred taxation assets and liabilities are not discounted. |
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Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or |
substantively enacted by the statement of financial position date. |
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Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement |
of financial position date. |
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Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from |
those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that |
have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the |
timing difference. |
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Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will |
be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
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2. | ACCOUNTING POLICIES - continued |
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Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement |
of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling |
at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
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Pension costs and other post-retirement benefits |
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 does not have a legal or constructive obligation to pay further contributions even if the fund does not hold |
sufficient assets to pay all employee service in the current and prior periods. |
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Contributions to defined contribution plans are recognised as employee benefit expense when they are due. The |
school participates in the Teacher's Pension Scheme (England and Wales) for its teaching staff. This is a |
multi-employer defined benefits pension scheme and it is not possible to identify assets and liabilities of the scheme |
which are attributable to the school. As required by FRS 102, the school accounts for this scheme as if it were a |
defined contribution scheme. |
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Prepaid fees |
Fees paid in advance are included in creditors and released to the Income Statement as they fall due. |
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Pupil deposits |
The directors have reviewed the contract terms under which pupil fee deposits are held by the School. Although |
under normal circumstances these will be repaid in future years when the pupils complete their education at the |
school, pupils can leave at earlier dates. The school does not have an unconditional right to retain the individual |
deposits for at least 12 months after the year end and, in accordance with the requirements of FRS 102, the balance |
of deposits held at the year end have been included within current liabilities. |
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Expenditure |
The company operates a partial exemption scheme for VAT. Non-allowable VAT is shown as a separate line on the |
profit and loss account. |
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Going concern |
After reviewing the company's budgets and projections, and giving regard to future funding secured, the directors |
have a reasonable expectation that the company has adequate resources to continue in operational existence for the |
foreseeable future. The company therefore adopts the going concern basis in preparing the financial statements, |
Please see note 24 for further details. |
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Share capital |
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other |
resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and |
the time value of money is material, the initial measurement is on a present value basis. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
3. | EMPLOYEES AND DIRECTORS |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Wages and salaries |
|
|
Social security costs |
|
|
Other pension costs |
|
|
|
|
|
The average number of employees during the year was as follows: |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
|
Average number of employees |
|
|
|
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Directors' remuneration |
|
|
|
4. | OPERATING LOSS |
|
The operating loss is stated after charging: |
|
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Depreciation - owned assets |
|
|
Loss on disposal of fixed assets |
|
|
Goodwill amortisation |
|
|
Website and branding amortisation |
|
|
|
5. | AUDITORS' REMUNERATION |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Fees payable to the company's auditors for the audit of the company's
financial statements |
|
14,478 |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Interest payable on bonds |
|
|
Interest on preference shares |
|
|
Interest on CT61 tax |
|
|
|
|
|
7. | TAXATION |
|
Analysis of the tax credit |
The tax credit on the loss for the year was as follows: |
Period |
20/7/17 |
Year Ended | to |
31/8/19 | 31/8/18 |
£ | £ |
Deferred tax | ( |
) | ( |
) |
Tax on loss | ( |
) | ( |
) |
|
UK corporation tax has been charged at 19% . |
|
8. | INTANGIBLE FIXED ASSETS |
Website |
and |
Goodwill | branding | Totals |
£ | £ | £ |
COST |
At 1 September 2018 |
and 31 August 2019 |
|
|
|
AMORTISATION |
At 1 September 2018 |
|
|
|
Amortisation for year |
|
|
|
At 31 August 2019 |
|
|
|
NET BOOK VALUE |
At 31 August 2019 |
|
|
|
At 31 August 2018 |
|
|
|
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
9. | TANGIBLE FIXED ASSETS |
Freehold | Plant and | Motor | Computer |
property | machinery | vehicles | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 September 2018 |
|
|
|
|
|
Additions |
|
|
|
|
|
At 31 August 2019 |
|
|
|
|
|
DEPRECIATION |
At 1 September 2018 |
|
|
|
|
|
Charge for year |
|
|
|
|
|
At 31 August 2019 |
|
|
|
|
|
NET BOOK VALUE |
At 31 August 2019 |
|
|
|
|
|
At 31 August 2018 |
|
|
|
|
|
|
National Westminster Bank Plc hold a fixed and floating charge over the land, fixtures & fittings and plant and |
machinery owned by the company. |
|
The directors have considered the need to impair tangible fixed assets and are satisfied that no provision in |
necessary. |
|
10. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2019 | 2018 |
£ | £ |
Trade debtors |
|
|
Student fees debtor |
|
|
Owed from Gordons Solicitors |
|
|
London & Oxford Capital Markets Ltd |
|
|
Ipswich High School Charitable Foundation |
|
|
CT61 tax owed from bondholders |
|
|
JH Global Partners Ltd |
|
|
VAT |
|
|
Deferred tax asset |
|
|
Prepayments and accrued income |
|
|
|
|
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
11. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2019 | 2018 |
£ | £ |
5% bonds (see note 13) |
|
|
Preference shares (see note 13) |
|
|
Payments on account - prepaid school fees |
|
|
Trade creditors |
|
|
Student deposit account |
|
|
Loan: Bedstone Educational Ltd |
|
|
Loan London and Oxford Capital Holding Ltd |
|
|
Social security and other taxes |
|
|
Pension control |
|
|
VAT |
|
|
Other creditors - Interest accrued on bonds
and preference shares |
|
|
Charity collections |
|
|
CT61 tax payable to HMRC |
|
|
Accruals |
|
|
Deferred income re school trips, events and
bus income |
|
|
Third party funds |
|
|
Deferred income re fees |
|
|
|
|
|
ADVANCE FEE PAYMENTS |
|
Parents may enter into a contract to pay to the school tuition fees in advance by making an agreement with the Head. |
The money may be returned subject to specific conditions on receipt of one terms notice. These figures also include |
recoverable extras due during the term. Advance fees are shown within one year in trade creditors as the funds have |
to be available if the pupil leaves the school. Assuming pupils remain at the school, advance fees will be applied as |
follows:- |
2019 | 2018 |
£ | £ |
After 5 years | - | - |
Within 2 - 5 years | 59,262 | - |
Within 1 - 2 years | 85,443 | 14,550 |
Within 1 year | 147,297 | 182,505 |
292,002 | 197,055 |
|
This represents the accrued liabilities under contracts. |
|
12. |
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR |
2019 | 2018 |
£ | £ |
5% bonds (see note 13) |
|
|
Preference shares (see note 13) |
|
|
|
|
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
13. | LOANS |
|
An analysis of the maturity of loans is given below: |
|
2019 | 2018 |
£ | £ |
Amounts falling due within one year or on demand: |
5% Bonds - due within one year | 7,820,000 | - |
Preference shares | 800,000 | - |
|
|
|
Amounts falling due between one and two years: |
5% Bonds - 1-2 years | - | 7,820,000 |
Preference shares | - | 800,000 |
|
|
|
FINANCIAL INSTRUMENTS |
|
At year end the company had issued £7,820,000 of 5% corporate bonds, these are redeemable by the company from |
November 2019 onwards. |
|
Details of shares shown as liabilities are as follows: |
|
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2019 | 2018 |
value: | £ | £ |
|
Preference | £10 | 800,000 | 800,000 |
|
14. | PROVISIONS FOR LIABILITIES |
2019 | 2018 |
£ | £ |
Other provisions |
Doubtful debt provision |
|
|
|
Deferred |
tax |
£ |
Balance at 1 September 2018 | ( |
) |
Provided during year | ( |
) |
Balance at 31 August 2019 | ( |
) |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
15. | CALLED UP SHARE CAPITAL |
|
Allotted and issued: |
Number: | Class: | Nominal | 2019 | 2018 |
value: | £ | £ |
|
Ordinary shares | 1p | 1,000,000 | 1,000,000 |
|
16. | RESERVES |
Retained |
earnings |
£ |
|
At 1 September 2018 | ( |
) |
Deficit for the year | ( |
) |
At 31 August 2019 | ( |
) |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
17. | PENSION COMMITMENTS |
|
Defined benefit scheme |
|
The School participates in the Teacher's Pension Scheme ("the TPS") for its teaching staff. This is a multi-employer |
defined benefits scheme and it is not possible or appropriate to identify the assets and liabilities of the scheme which |
are attributable to the school. |
|
The pension charge for the period includes contributions payable to the TPS of £400,920 (2018 - £286,133). |
|
The Teachers' Pension Scheme (TPS or scheme) is a statutory, unfunded, defined benefit occupational scheme, |
governed by the Teachers' Pensions Regulations 2010 (as amended), and the Teachers' Pension Scheme Regulations |
2014 (as amended). These regulations apply to teachers in schools and other educational establishments, including |
academies, in England and Wales that are maintained by local authorities. In addition, teachers in many independent |
and voluntary-aided schools and teachers and lecturers in some establishments of further and higher education may |
be eligible for membership. Membership is automatic for full-time teachers and lecturers and, from 1 January 2007, |
automatic too for teachers and lecturers in part-time employment following appointment or a change of contract. |
Teachers and lecturers are able to opt out of the TPS. |
|
Although members may be employed by various bodies, their retirement and other pension benefits are set out in |
regulations made under the Superannuation Act (1972) and Public Service Pensions Act (2013) and are paid by |
public funds provided by Parliament. The TPS is an unfunded scheme and members contribute on a 'pay as you go |
'basis - contributions from members, along with those made by employers, are credited to the Exchequer under |
arrangements governed by the above Acts. |
|
The Teachers' Pensions Regulations 2010 require an annual account, the Teachers' Pension Budgeting and Valuation |
Account, to be kept of receipts and expenditure (including the cost of pension increases). From 1 April 2001, the |
Account has been credited with a real rate of return, which is equivalent to assuming that the balance in the Account |
is invested in notional investments that produce that real rate of return. |
|
The latest valuation of the Teachers' Pension Scheme has now taken place, in line with directions issued by HM |
Treasury and using membership data as at 31 March 2016. As a result of this valuation TPS employers will pay an |
increased contribution rate of 23.68% from September 2019 (this includes the administration levy of 0.8%). The |
timing of the implementation is to align its introduction with employers' budget planning cycles. Until then, |
employers will pay the current rate of 16.48%. |
A copy of the latest valuation report can be found on the Teachers' Pension Scheme website. |
|
The arrangements for a reformed Teachers' Pension Scheme, in line with the recommendations made by Lord |
Hutton, in particular the introduction of a Career Average Revalued Earnings (CARE) scheme, were implemented |
from 1 April 2015. |
|
In December 2018, the Court of Appeal held that transitional protection provisions contained in the reformed judicial |
and firefighter pension schemes, introduced as part of public service pension reforms in 2015, gave rise to direct age |
discrimination and were therefore unlawful. The Supreme Court, in a decision made in June 2019, have rejected the |
Government's application for permission to appeal the Court of Appeal's ruling. The case will now be referred to an |
Employment Tribunal for a decision regarding the remedy which will need to be offered to those members of the two |
schemes who were subject of the age discrimination. |
|
HM Treasury are clear that the ruling has implications for the other public service schemes, including the Teachers' |
Pension Scheme. Those implications are currently being considered and any impact on scheme costs is expected to |
be looked at within the next scheme valuation, which is currently scheduled to be based on April 2020 data and |
implemented in April 2023. |
|
|
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
Defined contribution scheme |
|
The company operates two defined pension contribution schemes. The assets of the two schemes are held separately |
from the company in funds independently administered. The pension charge represents contributions payable by the |
company of £79,544. (2018 - £56,292) |
|
18. | CONTINGENT LIABILITIES |
|
At year end the directors were not aware of any contingent liabilities (2018 - Nil). |
|
19. | CAPITAL COMMITMENTS |
|
At the 31 August 2018 the company did not have any capital commitments (2018 - Nil) |
|
20. | OTHER FINANCIAL COMMITMENTS |
|
The company has entered into a 7 year contract with a supplier to improves its energy efficiency. Future obligations |
to payment under this contract after excluding VAT recoverable are as follows:- |
|
2019 | 2018 |
£ | £ |
Within 1 year | 212,300 | 203,883 |
1 - 2 years | 212,300 | 203,883 |
2 - 5 years | 636,901 | 611,648 |
over 5 years | 106,150 | 305,824 |
Total | 1,167,651 | 1,325,238 |
|
|
|
At period end the company was obliged to make future payments under leasing, rental and hire agreements |
as follows:- |
|
2019 | 2018 |
£ | £ |
Within 1 year | 16,052 | 19,066 |
1 - 2 years | 5,061 | 14,514 |
2 - 5 years | 5,905 | 10,453 |
Total | 27,018 | 44,033 |
|
21. | RELATED PARTY DISCLOSURES |
|
At the year end the company had an outstanding loan balance due to London and Oxford Capital Holding Ltd (a |
company under common control) of £1,400,000. |
|
At the year end Ipswich High School Charitable Foundation, a charity which Mr P Newton (a former director), is a |
trustee, owed the company £7,891. |
|
At the year end the company owed Bedstone Educational Ltd (a company under common control) £240,000. During |
the year there were short term interest free loans between the companies. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
22. | POST BALANCE SHEET EVENTS |
|
During January 2020, ownership of the company changed and the ultimate controlling party became Ms X Lin. |
|
|
After the year end the company underwent a significant financial restructuring as follows:- |
|
November 2019 - The company, as borrower entered into a £6,000,000 loan facility agreement with Bedstone |
Educational Ltd (a company under common control) as lender. |
|
November 2019 - £1,400,000 was repaid in respect of the London and Oxford Capital Holding Ltd loan. |
|
November/December 2019 - £4,500,000 of 5% 360 Bonds were issued, these bonds were all purchased from the |
bondholders by Bedstone Educational Ltd, a company under common control, during January 2020. |
|
November/December 2019 - Bonds redeemed £7,820,000. |
|
January 2020 - £800,000 ordinary £1 shares were issued |
January 2020 - £800,000 preference shares were redeemed |
|
January 2020 - All the ordinary share capital was acquired by Ipswich International Education Group Ltd. |
|
|
The school is actively developing plans to provide accommodation for boarding pupils with a view to offering places |
from 2019/20 onwards. |
|
23. | ULTIMATE CONTROLLING PARTY |
|
As at the year ended 31 August 2019, Ipswich Education Ltd was a wholly owned subsidiary of Ipswich Educational |
Holding Ltd (registered number 1954380 - 90 Main Street, PO Box 3099, Road Town, Totola, British Virgin |
Islands. Ipswich Educational Holdings Ltd is controlled by London and Oxford Capital Holding Ltd which is wholly |
owned by Mr C Yingsaeree. |
|
After the year end the ultimate controlling party became Ms X Lin. |
IPSWICH EDUCATION LIMITED (REGISTERED NUMBER: 10875162) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 AUGUST 2019 |
|
24. | GOING CONCERN BASIS OF ACCOUNTING |
|
The Covid 19 pandemic has generally adversely affected the UK independent school sector and the ongoing future |
effects are somewhat uncertain. The Company is expected to continue making losses in the periods to 31st August |
2020 and 31st August 2021. |
|
In order to meet these commitments and to finance the expected losses, an arrangement has been made with Ipswich |
International Education Group Limited, whereby financial support will be provided. Ipswich Education Ltd is |
expected to return to profit during the year ending 31st August 2022. |
|
The Directors are closely monitoring the expected losses, analysing areas of expenditure where efficiencies can be |
made. Recruitment of students is critical in order to achieve the projected return to profits in 2022. From September |
2019, boarding facilities become available, and will be expanded to allow more students from further afield to attend |
the School and increase the overall number of students. |
|
Having considered all of the information available to them, the Directors consider that there is a material uncertainty |
relating to these events and conditions, which may cast doubt on the entity's ability to continue as a going concern. |
However, following on from the change of ownership and financial restructuring undertaken in January 2020 and |
given the arrangement in place with Ipswich International Education Group Limited and the expectation of future |
profitability, they consider it appropriate to prepare the financial statements using the going concern basis. |