Consolidated Statement of Cash Flows For the year ended

31 December 2022

Notes 1 to 24 form an integral part of these financial statements.

For The Year Ended

31 DECEMBER 2022

1. Accounting Policies

(A) STATEMENT OF COMPLIANCE

Cadogan Group Limited is a private company limited by shares incorporated in England (registered number 2997357). The Registered Office is 10 Duke of York Square, London, SW3 4LY.

The financial statements of Cadogan Group Limited were authorised for issue by the Board of Directors on 4 May 2023.

(B) BASIS OF PREPARATION

The Group’s and company’s financial statements have been prepared in compliance with FRS 102.

The financial statements have been prepared on a historical cost basis except investment properties and derivative financial instruments that have been measured at their fair value. The financial statements are prepared in sterling which is the functional currency of the Group and rounded to the nearest £000.

Through the Group’s risk management process a number of material risks to the business were identified including climate risk. By their nature these risks were not identified as a material factor to going concern during the relevant period. However, climate related factors will increasingly influence investment property valuations as relevant property characteristics are valued by the market. To the extent that these exist and are significant they will be embedded in the external valuation provided to the Group and held on the consolidated statement of financial position.

Going concern

The group’s business activities, together with the factors likely to affect its future development, its financial position, financial risk management objectives, details of its financial instruments and derivative activities, and its exposures to price, credit, liquidity and cash flow risk are set out in the Strategic Report on pages 8 to 47.

The group has considerable financial resources derived from an established investment property portfolio in prime central London. The group has substantial longterm committed financing arrangements and has access to overdraft and recently renewed revolving credit facilities (see note 23) from its bankers. The overdraft is renewed annually and therefore not committed for the full review period.

The directors have considered the appropriateness of adopting the going concern basis in preparing the financial statements for the year ended 31 December 2022 taking into account new inflationary pressures on the economy, consumers and our tenants and the possibility of an economic downturn. The assessment is based on the Group’s experience over the last three years and financial forecasts for the periods to 31 December 2024 overlaid with a severe but plausible downside economic downturn scenario.

The budget for 2023 has been prepared prudently. Assumptions regarding rent receipts and lease renewals are more prudent than our actual experience during 2022. Development and investment activity increases further during 2023. Property values are assumed to fall by 5% on average in 2023.

The Group has also assessed a severe but plausible downside scenario based on the occurrence of an economic downturn having an impact similar to that of the pandemic in its first year. An economic downturn would reduce sales for our retail, leisure and hospitality tenants, damaging their cash flow and ability to pay rent. Trading would take at least 12 months to recover. The main impacts would be a further fall in property values, a decline in rent collections for at least 12 months, with a slow recovery thereafter and an increase in impairments and rent concessions.

For 2023 and 2024, we have assumed there would be no new financing activity other than repayments of