K G Engineering Services (Silverdale) Limited - Accounts

Statement of compliance

These financial statements have been prepared in compliance with FRS 102 – The Financial Reporting Standard applicable in the UK and Republic of Ireland and the Companies Act 2006.

Basis of preparation

The financial statements have been prepared under the historical cost convention as modified by the revaluation of land and buildings and certain financial instruments measured at fair value in accordance with the accounting policies.

The financial statements are prepared in sterling which is the functional currency of the company.

The director has considered the impact of COVID 19 on the company and is of the opinion that the company has not been adversely affected by the pandemic. The director has reviewed the current financial position of the company and concluded that it is financially secure and therefore, the going concern basis of accounting continues to be used in preparing the financial statements.

Turnover is made up of the invoiced value of goods and services supplied by the company, net of Value Added Tax and trade discounts and recognised in the financial statements when invoiced following the completion of services provided or goods sold that have arisen during the normal course of business. A provision is also recognised in the financial statements at the  accounting date for incomplete services or un-invoiced sales which are based on the value of the work done to date.

Government grants received are credited to deferred income. Grants towards capital expenditure are released to the income statement over the expected useful life of the assets. Grants received towards revenue expenditure are released to the income statement as the related expenditure is incurred.

The current tax position for the period is based on the taxable profit or loss. The taxable profit or loss may differ from the profit or loss reported in the financial statements because adjustments are made for items that are treated differently for tax purposes compared to their treatment for accounting purposes. The tax liability is based on current tax law and rates.

Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for tax purposes compared to their treatment for accounting purposes. The deferred tax balance has not been discounted.

Dividends that are deemed to have been voted and paid during the period are included in these financial statements. Proposed dividends are only included as liabilities in the financial statements when their payment has been approved by the shareholders prior to the balance sheet date.

Tangible fixed assets, other than freehold land, are stated at cost or valuation less depreciation and any provision for impairment. Depreciation is provided at rates calculated to write off the cost or valuation of fixed assets, less their estimated residual value, over their expected useful lives on the following basis:

Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow moving items. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

Debtors include amounts recoverable on long term contracts which are stated at the net sales value of the work done less provisions for contingencies, anticipated losses and amounts received on account. Any excess progress payments are included in creditors as payments on account. Contracts that take longer than 1 month to complete are categorised as long term for these purposes.

Provisions are recognised when the company has a present obligation as a result of a past event which it is more probable than not will result in an outflow of economic benefits that can be reasonably estimated.

The company has elected to apply the provisions of Section 11 Basic Financial Instruments and Section 12 Other Financial Instruments Issues of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Basic financial instruments included within these financial statements are valued at the transaction price applicable at the time of the transactions.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.