Abbreviated Company Accounts - WATTS DEVELOPMENTS LIMITED

1Accounting Policies

Basis of measurement and preparation of accounts
The accounts have been prepared under the historical cost convention and in accordance with the Financial Reporting Standard for Smaller Entities effective April 2008.

Turnover policy
Turnover comprises revenue recognised by the company on the completion of the development and
building projects during the year, exclusive of Value Added Tax and trade discounts.

Tangible assets depreciation policy
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to write off the cost of fixed assets, less their estimated residual value, over their expected useful lives on the following bases:
Plant and machinery - straight line 10%
Motor vehicles - straight line 20%
Fixtures and fittings - straight line 10%

Intangible assets amortisation policy
Goodwill is the difference between amounts paid on the acquisition of a business and the fair value of the identifiable assets and liabilities. It is amortised to the Profit and loss account over its estimated economic life.
Amortisation is provided at the following rates:
Goodwill - straight line 10%

Valuation information and policy
Stocks and work in progress
Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

Other accounting policies
Leasing and hire purchase
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the
company. Obligations under such agreements are included in creditors net of the finance charge
allocated to future periods. The finance element of the rental payment is charged to the Profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Deferred taxation
Full provision is made for deferred tax assets and liabilities arising from all timing differences
between the recognition of gains and losses in the financial statements and recognition in the tax
computation.
A net deferred tax asset is recognised only if it can be regarded as 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 assets and liabilities are calculated at the tax rates expected to be effective at the time the timing differences are expected to reverse.
Deferred tax assets and liabilities are not discounted.

Taxation
Corporation tax payable is provided on taxable profits at the current rates.

RELATED PARTY TRANSACTIONS
At the year end the total amount owed by the company to its director Gary Watts was £123,061 (2013 - £120,141).
During the year both of the directors received interim dividends totalling £715 each.
During the year the company disposed of a Ducati Motorbike to the director Gary Watts. The proceeds from the sale totalled £11,500 and this represents the market value of the asset.

CONTROLLING PARTY
During the current and previous years the company has been under the control of its directors.