1Accounting Policies

Basis of measurement and preparation of accounts
The accounts are prepared under the historical cost convention.

Turnover policy
Turnover represents net sales of goods and services, excluding Value Added Tax.

Tangible assets depreciation policy
Depreciation is provided, after taking account of any grants receivable, at the following annual rates in order to write off each asset over its expected useful life:

Reducing balance method

Furniture and fittings - 20%
Motor vehicles - 25%

Straight line method

Equipment - 20%

Other accounting policies
Leased assets and assets held under hire purchase agreements

Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged against profit on a straight line basis over the lease term.

Assets held under finance lease and hire purchase contracts are capitalised and depreciated over their useful lives. The corresponding lease or hire purchase obligation is treated in the balance sheet as a liability. The interest element of rental obligations is charged to profit and loss account over the period of the lease at a constant proportion of the outstanding balance of capital repayments.

Stocks

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowances for obsolete and slow-moving items. Cost includes all direct expenditure and an appropriate proportion of fixed and variable overheads.

Deferred taxation

Deferred tax arises as a result of including items of income and expenditure in taxation computations in periods different to those in which they are included in the Company's accounts. Deferred tax is provided in full on timing differences which result in an obligation to pay more (or less) tax at a future date, at average rates that are expected to apply when the timing differences reverse, based on current tax rates and laws.

Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered. Deferred tax assets and liabilities are not discounted.