Limited Li?bility Partnership Registration No. 50300920 (Scotland) CASTLE STUART GOLF LLP ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018 PAGES FOR FILING WITH REGISTRAR Ii 14/09/2019 #598 COMPANIES HOUSE SATURDAY CASTLE STUART GOLF LLP LIMITED LIABILITY PARTNERSHIP INFORMATION Designated member Limited liability partnership number Registered of?ce Accountants Solicitors Grant Sword 80300920 Kinburn Castle Doubledykes Road ST ANDREWS Fife KY16 90R Johnston Carmichael LLP Clava House Cradlehall Business Park INVERNESS IV2 5GH Thorntons LLP 17-21 Bell Street ST ANDREWS KY16 9DR CASTLE STUART GOLF LLP CONTENTS Balance sheet Notes to the financial statements Page CASTLE STUART GOLF LLP BALANCE SHEET AS AT 31 DECEMBER 2018 Notes Fixed assets Tangible assets 3 Investments 4 Current assets Stocks Debtors 5 Cash at bank and in hand Creditors: amounts falling due within 6 one year Net current liabilities Total assets less current liabilities Creditors: amounts falling due after 7 more than one year Net assets attributable to members Represented by: 'Loans and other debts due to members within one year Members' capital classified as a liability Amounts due in respect of losses Members' other interests Members' capital classified as equity Other reserves classified as equity Total members' interests Loans and other debts due to members Members' other interests 2018 120,994 27,184 133,178 281,356 (3,247,541) 7,975,876 78,725 8,054,601 (2,966,185) 5,088,416 (2,278,898) 2,809,518 10,347,070 (570,390) 9,776,680 117 (6,967,279) 2,809,518 9,776,680 (6,967,162) 2,809,518 2017 101,118 23,792 222,880 347,790 (2,860,877) 7,203,519 77.893 7,281,412 (2,513,087) 4,768,325 (1,721,769) 3,046,556 10,213,529 (1,057,664) 9,155,865 111 (6.109.420) 3,046,556 9,155,865 (6,109,309) 3,046,556 CASTLE STUART GOLF LLP BALANCE SHEET (CONTINUED) AS AT 31 DECEMBER 2018 The members of the limited liability partnership have elected not to include a copy of the pro?t and loss account within the ?nancial statements. For the financial year ended 31 December 2018 the limited liability partnership was entitled to exemption from audit under section 477 of the Companies Act 2006 (as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) relating to small limited liability partnerships. The members acknowledge their responsibilities for complying with the requirements of the Act (as applied to limited liability partnerships) with respect to accounting records and the preparation of accounts. These ?nancial statements have been prepared in accordance with the provisions applicable to limited liability partnerships subject to the small limited liability partnerships' regime and the provisions applicable to entities subject to the small companies regime. ial statements were approved by the members and authorised for issue on 4/2 and are their behalf by: . Designa ed member Limited Liability Partnership Registration No. 80300920 CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018 1.1 1.2 1.3 Accounting policies Limited liability partnership information Castle Stuart Golf LLP (80300920) is a limited liability partnership domiciled and incorporated in Scotland. The registered of?ce is Kinburn Castle, Doubledykes Road, St Andrews, Fife, KY16 9DR and the business address is Balnaglack Farmhouse, Inverness, lV2 7JL. Accounting convention These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by? Limited Liability Partnerships" revised in 2015, together with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" 102"), Section 1A applicable to small entites and the requirements of the Companies Act 2006. The ?nancial statements are prepared in sterling, which is the functional currency of the limited liability partnership. Monetary amounts in these ?nancial statements are rounded to the nearest E. The ?nancial statements have been prepared on the historical cost convention. The principal accounting policies adopted are set out below. The limited liability partnership has taken advantage of the exemption under section 398 of the Companies Act 2006 not to prepare consolidated accounts. The ?nancial statements present information about the limited liability partnership as an individual entity and not about its group. Going concern Castle Stuart Golf LLP continues to strengthen its presence in the golf and leisure markets in a challenging economic period. Whilst the LLP has made losses to date, the members are con?dent of future progress in both the provision of golf and associated leisure and hospitality services as the next phase of the course development begins. The members are presently funding the operations of the LLP through direct member balances and short terms loans, with continued support also from the bank in the form of a formal 10 year bank loan facility and shorter term overdraft facility. The designated members are satis?ed that continued support will be available from the members for a period of at least 12 months from the signing of these ?nancial statements. Negotiations are continuing towards funding solutions for the next phase of the course development. - Turnover Turnover represents amounts receivable for green fees and related facility provision, merchandise sales and food and beverage sales net of VAT and trade discounts. Turnover is recognised at the point of sale for merchandise, food and beverage sales and when a round of golf has been played for green fees and related facility provision. Turnover also includes the share of pro?ts or losses arising from the investment in Castle Stuart Resort Ownership LLP. CASTLE STUART GOLF LLP . NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 '1.4 1.5 Accounting policies (Continued) Members' participating interests Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or othenivise contributed remuneration and pro?ts). Members' participation rights in the'earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a ?nancial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or othenrvisecontributed by members, for example members? capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classi?ed as equity. All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members' and, where suCh an amount relates to current year pro?ts, they are recognised within ?Members' remuneration charged as an expense? in arriving at the relevant year?s result. Undivided amounts that are classi?ed as equity are shown within ?Members other interests?. Amounts recoverable from members are presented as debtors and shown as amounts due from members within members? interests. Where there exists an asset and liability component in respect of an individual member's participation rights, they are presented on a gross basis unless the LLP has both a legally enforceable right to set off the recognised amounts, and it intends either to settle on a net basis or to settle and realise'these amounts simultaneously, in which case they are presented net. Tangible fixed assets Tangible ?xed assets are initially and subsequently measured at cost net of depreciation and any impairment losses. Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases: Golf course development coursebuilding . 25% and 50% straight. line Clubhouse - 2% and 10% straight line Plant and machinery - 25% reducing balance Fixtures, ?ttings equipment, - 20% and 25% straight line Assets under construction - not depreciated Motor vehicles - 25% reducing balance Other assets . - 5% straight line No depreciation has been charged on the hotel, second course and fractional development costs as the assets are still under construction 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 recognised in the pro?t and loss account. I (1. CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 1.6 1.7 1.8 1.9 1.10 Accounting policies (Continued) Fixed asset investments Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in pro?t or loss. A subsidiary is an entity controlled by the limited liability partnership. Control is the power to govern the ?nancial and operating policies of the entity so as to obtain bene?ts from its activities. Fixed asset investments represent an interest in a limited liability partnership and has been accounted for using the equity method of accounting at cost plus any drawings met on behalf of the partnership and share of profits not drawn from the partnership. Impairment of fixed assets At each reporting end date, the limited liability partnership 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). Stocks Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in pro?t and loss account. Reversals of impairment losses are also recognised in pro?t and loss account. Cash and cash equivalents Cash and cash equivalents include cash in hand, deposits held at call with banks and bank overdraits. Bank overdrafts are shown within borrowings in current liabilities. Financial instruments . The limited liability partnership has elected to apply the provisions of Section 11 'Basic Financnl Instruments? and Section 12 'Other Financial Instruments issuesits ?nancial instruments. Financial instruments are recognised in the limited liability partnership's balance sheet position when the limited liability partnership becomes party to the contractual provisions of the instrument. Financial assets and liabilities are offset and the net amounts presented in the ?nancial 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 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. Impairment of financial assets Financial assets are assessed for indicatorsof impairment at each reporting end date. CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 1.11 1.12 1.13 1.14 Accounting policies (Continued) Derecognition of financial assets Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the limited liability partnership transfers the ?nancial asset and substantially all the risks and rewards of ownership to another entity.? 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 limited liability partnership after deducting all of its liabilities: Basic ?nancial liabilities. including trade and other creditors and bank loans, are initially recognised at transaction price unless the arrangement constitutes a ?nancing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost. using the effective interest rate method. Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts 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. Taxation The taxation payable on the partnership pro?ts is solely the personal liability of the individual members consequently neither partnership taxation nor related deferred taxation arising in respect of the partnership are accounted for in these ?nancial statements. Employee benefits The costs of short-term employee benefits are recognised as a liability and an expense. unless those costs are required to be recognised as part of the cost of stock or ?xed assets. The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received. Retirement benefits and post retirement payments to members Payments to de?ned contribution retirement bene?t schemes are charged as an expense as they fall due. Leases Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classi?ed as operating leases. Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the profit and loss account so as to produce a constant periodic rate of intereSt on the remaining balance of the liability. Rentals payable under operating leases, including any lease incentives received, are charged to profit and loss account on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic bene?ts from the lease asset are consumed. CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 I 2 Employees The average number of persons (excluding members) employed by the partnership during the year was: 2018 2017 Number Number Sales and Operations 30 29 Administration and Management 9 9 39 38 Tangible fixed assets Land and Plant and Total buildings machinery etc Cost At 1 January 2018 8,954,660 1,396,557 10,351,217 Additions 1,006,711 105,247 1,111,958 Disposals - (14,451) (14,451) At 31 December 2018 9,961,371 1,487,353 11,448,724 Depreciation and impairment At 1 January 2018 2,192,097 955,601 3,147,698 Depreciation charged in the year 222,940 110,187 333,127 Eliminated in respect of disposals - (7,977) (7,977) At 31 December 2018 2,415,037 1,057,811 3,472,848 Carrying amount At 31 December 2018 7,546,334 429,542 7,975,876 At 31 December 2017 6,762,563 440,956 7,203,519 Included within land and buildings are assets under construction with a carrying value of ?1,826,919 (2017 - ?827,903) which have not been depreciated. Fixed asset investments 2018 2017 Notes 13 Investments in LLP 78,725 77,893 The Limited Liability Partnership holds an 80% interest in Castle Stuart Resort Ownership LLP, a leisure hospitality business operated from Balnaglack Farm, Castle Stuart, lnverness. .CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 (Continued) 4 Fixed asset investments Movements in fixed asset investments Interest in LLP Cost or valuation At 1 January 2018 77,893 Additions . 4,162 Share of Loss . - (3,330) At 31 December 2018 78,725 Carrying amount At 31 December 2018 a 78,725 At 31 December 2017 77,893 5 Debtors 2018 2017 Amounts falling due within one year: Trade debtors 5,058 13,288 Other debtors 13,352 10,504 Prepayments and accrued income 8,774 - 27,184 23,792 6 Creditors: amounts falling due within one year 2018 2017 Notes Bank loans and overdrafts 8 178,056 177,432 Obligations under finance leases 66,963 44,893 Trade creditors 122,740 43,424 Other taxation and social security 32,136 48,405 Other creditors 2,847,646 2,546,723 - 3,247,541 2,860,877 Included within other creditors is a balance due to Highlands 8 Islands Enterprise of ?500,000 (2017 - ?500,000) which is subject to a standard security over Balnaglack Farm, Dalcross, lnverness. Net obligations under hire purchase contracts are secured over theassets which the agreements relate to. I il' ?1 CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 I 7 Creditors: amounts falling due after more than one year 2018 2017 Notes Loans and overdrafts 8 1,117,865 1,294,765 Obligations under finance leases 129,723 117,004 Other creditors 1,031,310 310,000 2,278,898 1,721 ,769 Amounts included above which fall due after five years are as follows: Payable by instalments 405,641 506,974 Net obligations under hire purchase contracts are secured over the assets which the agreements relate to. 8 Loans and overdrafts 2018 2017 Bank loans 1,295,921 1,472,197 Payable within one year 178,056 177,432 Payable after one year 1,117,865 1,294,765 1,295,921 1,472,197 The bank overdraft and loan are secured by a bond and floating charge over the whole assets of the LLP and a standard security over Phase 1 2, Balnaglack Farm, Dalcross, lnverness. 9 Loans and other debts due to members 2018 2017 2 Analysis of loans Loans from members 10,347,070 10,213,529 Amounts allocated to members in respect of losses (570,390) (1,057,664) 9,776,680 9,155,865. Included within loans due to members are loans of ?2,561,299 (2017 - ?2,427,496) which rank ahead of members' base funding amounts, but which will rank equally with unsecured creditors in the event of a winding up. The priority loans are unsecured and accrue interest at 7.5% above libor base rate. The base funding from each member is also unsecured, but subordinated to all other amounts due and accrues interest at Whilst balances due to members do have certain repayment profiles, they are ultimately repayable only to the extent that suf?cient available distributable cash is available. -9- CASTLE STUART GOLF LLP NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2018 10 Operating lease commitments 11 Lessee At the reporting end date the limited liability partnership had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows: 2018 2017 V\?thin one year 55,142 56,186 Between two and ?ve years 220,567 220,567 In over five years 2,319,054 2,374,196 2,594,763 2,650,949 The Limited Liability Partnership rents land under a long term operating lease agreement. Capital commitments 2018 2017 At 31 December 2018 the limited liability partnership had capital commitments as follows: Contracted for but not provided in the ?nancial statements: Acquisition of tangible fixed assets - 7,750 ln addition to the above, the committed and obligated to incur further expenditure following the completion of a capital project, the amount of which is subject to various external factors. -10-