The home of Ormsby (Freehold) Ltd  

Revised procedures were introduced nationally in 2011/12 relating to the formal presentation of annual accounts in respect of leasehold properties. On the advice of our independent accountants, the directors of Ormsby (Freehold) Ltd agreed to adopt these new procedures with effect from the accounting period ending on 31 March 2012.

Prior to this time, a single set of accounts had been produced to serve the purposes of an assurance to service charge payers required under Landlord & Tenant legislation and also for the purposes of reporting the financial position of the freehold company to Companies House as required by the Companies Act 2006. However, it has long been the case that service charge funds are held in trust on behalf of lessees and, strictly speaking therefore, these funds are not the property of the freehold company and should not therefore be reported as company assets in the financial statement submitted to Companies House. The company’s only financial asset is the value of the twenty-four £4 shares that it issued when the company was established. This will be included in the return to Companies House together with a statement regarding the transfer of service charge assets and liabilities to a separate service charge fund account.

Both the service charge accounts and the directors’ report and financial statement for Companies House will continue to be prepared by the company’s independent accountants who will certify both accounts, although final approval of the accounts is a responsibility of the board of directors. Ormsby’s lessees are entitled to receive both sets of accounts, the service charge accounts in their capacity as leaseholders and service charge payers and the directors’ report and financial statement in their capacity as shareholders of the freehold company.

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