Page 84 - Pobl Annual Report FY25

82 Annual Report 2025
Notes to the Financial Statements
for the year ended 31 March 2025
PFI and similar contracts
Under the PFI contract the underlying asset is not
deemed to be an asset of the Company because the
risk and rewards of ownership as set out are deemed to
lie principally with the Universities. During the
construction phase of the project, all attributable
expenditure is included in contract receivables and
turnover except interest as set out above. On becoming
operational, the costs are transferred to the finance
debtor.
During the operational phase a portion of income is
allocated between interest receivable and the finance
debtor using a project specific interest rate. The
remainder of the PFI unitary charge income is included
within turnover. The Company recognises income in
respect of the services provided as it fulfils its
contractual obligations in respect of those services and
in line with the fair value of the consideration receivable
in respect of those services.
Major maintenance costs are recognised on an incurred
basis and the revenue receivable in respect of these
services is recognised when these services are
performed.
Employee benefits
Short term benefits
Short term benefits, including holiday pay and other
similar non-monetary benefits are recognised as an
expense in the period in which the service is received.
Defined benefit pension scheme
Defined benefit schemes are funded, with the assets of
the scheme held separately from those of the Group, in
separate trustee-administered funds. The entity’s net
liability recognised in the Statement of Financial
Position in respect of the defined benefit schemes is
calculated by estimating the amount of the future benefit
that employees have earned in return for their service in
the current and prior periods; that benefit is discounted
to determine its present value. The fair value of the plan
assets is then deducted from that retirement benefit
obligation. Actuarial valuations of plan assets are
obtained at least triennially and are updated at each
Statement of Financial Position date.
Amounts charged to operating surplus (as part of staff
costs) are the costs arising from employee services
rendered during the period and the cost of plan
introductions, benefit changes, settlements and
curtailments. The net interest cost on the net defined
benefit liability is charged to revenue and included
within finance costs.
Remeasurement of the net defined benefit liability/asset
is recognised in Other Comprehensive Income in the
period in which it occurs.
Corporation Tax
The taxation expense for the period comprises current
and deferred tax recognised in the reporting period.
Current tax is the amount of Corporation Tax payable in
respect of the taxable surplus for the year or prior years.
Deferred tax arises from timing differences that are
differences between taxable profits and total
comprehensive income as stated in the financial
statements. These 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 recognised on all timing differences at
the reporting date apart from certain exceptions.
Unrelieved tax losses and other deferred tax assets are
only recognised where it is probable that they will be
recovered against the reversal of deferred tax liabilities
or other future taxable profits.
Deferred tax is calculated on the basis of tax rates and
laws that have been enacted or substantively enacted
at the period end.
Gift Aid payments are made by Pobl Living Limited and
Pobl Development Limited to other Group members to
offset surpluses which would otherwise give rise to
Corporation Tax becoming payable.
The receipt of Gift Aid is reflected within the income of
the recipient company.
Value Added Tax (VAT)
The Group is registered for VAT and charges VAT on
some of its income and is able to recover part of the
VAT it pays on expenditure. The financial statements
include VAT on expenditure to the extent that it is not
recoverable from HMRC. The balance of VAT payable
or receivable at the end of the financial year is included
as a current liability.
1.3. Summary of significant accounting policies (continued)