1Accounting Policies

Basis of measurement and preparation of accounts
The financial statements have been prepared under the historical cost convention, and in accordance with the Financial Reporting Standard for Smaller Entities (effective January 2015).

Turnover policy
The turnover shown in the profit and loss account represents the value of all work done during
the period, exclusive of Value Added Tax. Turnover is recognised at the point at which the
company has fulfilled its contractual obligations and the risks and rewards attaching to the sale
have been transferred to the customer.

Tangible assets depreciation policy
Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value,
over the useful economic life of that asset as follows:
Plant& Machinery - 15% straight line
Fixtures & Fittings - 10% straight line
Motor Vehicles - 25% straight line
Equipment - 33% straight line

Other accounting policies
Stocks

Stocks are valued at the lower of cost and net realisable value, on a first-in-first-out basis, after
making due allowance for obsolete and slow moving items. Cost is based on purchase price.

Hire purchase agreements

Assets held under hire purchase agreements are capitalised and disclosed under tangible fixed
assets at their fair value. The capital element of the future payments is treated as a liability and
the interest is charged to the profit and loss account on a straight line basis.

Pension costs

The company operates a defined contribution pension scheme for employees. The assets of the
scheme are held separately from those of the company. The annual contributions payable are
charged to the profit and loss account.

Deferred taxation

Deferred tax is recognised in respect of all timing differences that have originated but not
reversed at the balance sheet date where transactions or events have occurred at that date that
will result in an obligation to pay more, or a right to pay less or to receive more tax.

The only exception is that deferred tax assets are recognised only to the extent that the directors
consider that it is more likely than not that there will be suitable taxable profits from which the
future reversal of the underlying timing differences can be deducted.

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in
the periods in which timing differences reverse, based on tax rates and laws enacted or
substantively enacted at the balance sheet date.

Financial instruments

Financial liabilities and equity instruments are classified according to the substance of the
contractual arrangements entered into. An equity instrument is any contract that evidences a
residual interest in the assets of the entity after deducting all of its financial liabilities.