1Accounting Policies

Basis of measurement and preparation of accounts
Basis of preparation

These financial statements are prepared under the historical cost convention and in accordance with the Companies Act 2006 and applicable accounting standards in the United Kingdom.

The company’s assets and trade will be transferred into Medicines Discovery Catapult in 2017 and the company’s activities will continue in that entity. Subsequently, Precision Medicine Catapult will be liquidated. It is the intention of the directors that the company will continue to meet its legal obligations as they arise until liquidation has occurred. The date of liquidation has not yet been finalised, although the transfer of assets to Medicines Discovery Catapult is scheduled for 31 May 2017.

Accordingly, the going concern basis of preparation is no longer appropriate as at 31 March 2016 and the financial statements have been prepared on a basis other than going concern. Adjustments have been made in these financial statements to write down assets to their recoverable value and to reclassify fixed assets as current assets as at 31 March 2016. The comparative financial information continues to be prepared on a going concern basis. The principal accounting policies, which have been applied consistently throughout the year, are set out below and, where necessary, have been updated to include any policies which are now considered significant given the presentation of the financial statements as at 31 March 2016 on a non-going concern basis.

The financial statements have been prepared in compliance with United Kingdom Accounting Standards, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland” (“FRS102”) and the Companies Act 2006.

The company owns a wholly owned subsidiary, Precision Medicine Catapult Services Limited, which is dormant and has no assets, liability or trading results. This entity is not consolidated and group financial statements are not presented, pursuant to section 398 of the Companies Act 2006 and the exemption from the requirement to prepare consolidated financial statements, on the grounds that it is a small group.

Measurement convention

The financial statements have been prepared under the historical cost convention.

The preparation of financial statements in conformity with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 2.

Turnover policy
Turnover represents government and other grant income, and the sale of services net of value added tax.  The sale of services are recognised when the company obtains the rights to consideration.
Government grants

Government grants are accounted for using the accruals model. Elements of grants relating to future costs are deferred and released as the expense is recognised in the statement of comprehensive income. Grants are recognised when there is reasonable assurance that the company will comply with the conditions attached to the payments and the grants will be received. Grants of a capital nature are credited to deferred grants and released to the profit and loss account over the useful life of the assets concerned. Grants which are revenue in nature are credited to deferred grants and are released to the profit and loss account in the period in which the related expenditure is incurred.

Taxation

There was no tax payable or receivable in the current or prior financial period.

Tax on the profits or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised directly in equity or other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates as at the balance sheet date, and any adjustment arising from prior periods.

Deferred tax is provided on timing differences which arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised. Deferred tax is not recognised on permanent timing differences, and is not recognised for differences between accumulated depreciation and tax allowances for fixed assets when all conditions for retaining the tax allowances have been met. Deferred tax is measured using the tax rates as at the balance sheet date.
Tax assets and tax losses are recognised only to the extent it is probable that they will be recovered against the reversal of deferred tax liabilities or taxable profits in future periods.

Foreign currency

Transactions in foreign currencies are translated to the company's functional currency at the exchange rate ruling at the date of transaction. Exchange differences are recognised in the statement of comprehensive income.

Tangible assets depreciation policy
Tangible fixed assets are stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is charged to the statement of comprehensive income on a straight line basis over the estimated useful life for each component. A full month’s depreciation is charged in the month after acquisition. The estimated useful lives are as follows:

Asset Category & Useful Economic Life (years)
Computer and electronic equipment - 3 Years
Fixtures and fittings - 5 Years
Leasehold improvements - Over the life of the lease

As the financial statements have not been prepared on a going concern basis, tangible fixed assets have been reclassified to current assets and they have been reduced to their expected recoverable amounts (shown as Stock)

Intangible assets amortisation policy
Investment in subsidiaries are carried at cost. Due to the intention to liquidate Precision Medicine Catapult, fixed assets investments have been reclassified to current assets.
The investment is in an organisation called Precision Medicine Catapult Services Ltd which was dormant and there has been no transactions for the year ended 31-Mar-2016.

Valuation information and policy
1. Accounting policies

Employee benefits
The company pays into third party pension plans on behalf of its employees. Obligations for the pension plans are recognised as an expense in the statement of comprehensive income in the periods in which services are rendered by employees.

Provisions
A provision is recognised on the balance sheet when the Company has a present and legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are recognised at the best estimate of the amount required to settle the obligation at the reporting date.

Exceptional items
Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.

1. Critical judgements in applying the entity’s accounting policies

Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include:

Tangible fixed assets and revenue recognition of grant income

The carrying value of tangible fixed assets have been reduced to their expected recoverable amount of £1. This is the consideration the company will receive when its assets are sold to Medicines Discovery Catapult on 31 May 2017. Consequently, the grant income received to fund those assets has been recognised as revenue in the period.

Reclassification of tangible fixed assets and investments to current assets

Tangible fixed assets and investments have been reclassified to current assets as they are no longer intended for use on a continuing basis in the company’s activities.

2Company limited by guarantee
Company is limited by guarantee and consequently does not have share capital.