We have audited the financial statements of Trafalgar Property Group plc (the “Parent Company”) and its subsidiaries (the “Group”) for the year ended 31 March 2018, which comprise:

The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. The financial reporting framework that has been applied in the preparation of the Parent Company financial statements 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).

In our opinion:

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 Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Group 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.

Conclusions relating to going concern

Material uncertainty related to going concern

We draw attention to the going concern section in the notes to the financial statements. The group’s and parent company’s ability to generate funds to meet short term operating cash requirements and loan repayments is reliant on the group’s ability to sell the properties it holds, or to obtain alternative financing. The timing of these sales is uncertain and as a result the group is currently reliant on long term investor loans being renewed when they come up for repayment and the continued support of the Director Mr C Johnson, who has confirmed that he will continue to support the group and company, and, if necessary will not recall the balances owed to him for at least twelve months from the date of signing.

Notwithstanding the disclosure in the going concern note in the notes to the accounts and the directors’ belief that it is appropriate to produce these accounts on a going concern basis, we consider there to be factors that indicate that a material uncertainty exists that may cast doubt on the ability of the company and group to continue as a going concern. Our opinion is not modified in respect of this matter.

Overview of our audit approach


In planning and performing our audit we applied the concept of materiality. An item is considered material if it could reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of materiality to both focus our testing and to evaluate the impact of misstatements identified.

Based on our professional judgement, we determined overall balance sheet materiality for the Group financial statements to be £125,000 (FY17 £100,000), based on 2% of the total assets, with particular reference to the carrying value of inventory. We have determined that for other account balances not related to inventory a misstatement of less than materiality for the financial statements as a whole could influence the economic decisions of users. As such we have applied an income statement materiality of £30,000 (FY17 £30,000) based on 8-10% of the result before tax. The income statement materiality used is for sampling purposes only and is separate from the overall materiality.

We use a different level of materiality (‘performance materiality’) to determine the extent of our testing for the audit of the financial statements. Performance materiality is set based on the audit materiality as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the internal control environment.

Where considered appropriate performance materiality may be reduced to a lower level, such as, for related party transactions and directors’ remuneration.

We agreed with the Directors to report to it all identified errors in excess of £2,000 (FY17: £2,500). Errors below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative grounds.

Overview of the scope of our audit

We conducted full scope audit work at the Group’s head offices where the accounting records for the Group and its subsidiaries are maintained. Our work covered the Plc entity and its subsidiaries all of which are incorporated in the UK.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit ofthe financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit.

Annual report & consolidated financial statements 2018

Key audit matter

How the scope of our audit addressed the key audit matter

Valuation of inventory

The group develops properties at a number of sites incurring significant costs. These are required to be valued at the lower of cost and net realisable value.

We reviewed the additions to the inventory value during the year ensuring that the amounts recognized were appropriate and accounted for correctly.

In addition we reviewed the assessed realisable value of the developments for indications of potential impairment in the carrying value of the inventory by reference to agents’ valuations and market trends and data.

Revenue recognition

The group recognises revenue at the point of completion.

We reviewed sales during the year to ensure that these were recognised in line with the stated revenue recognition policy.

We reviewed revenue recognised post year end to ensure cut-off had been suitably applied.

Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole.

They were not designed to enable us to express an opinion on these matters individually and we express no such opinion.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

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.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion based on the work undertaken in the course of our audit

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’report.

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:


Responsibilities of the directors for the financial statements

As explained more fully in the directors’ responsibilities statement [set out on page 9], 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 is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group’ and parent company’ 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor’s 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 an auditor’s report 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.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: This description forms part of our auditor’s report.

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 an auditor's report 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.

Stacy Eden (Senior Statutory Auditor)
for and on behalf of Crowe U.K. LLP, Statutory Auditor

4th September, 2018