Abbreviated Company Accounts - THOR MOTOR FACTORS 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 represents sales net of value added tax and discounts for goods and services provided to customers.

Tangible assets depreciation policy
Tangible Fixed Assets are stated at cost less depreciation.
Depreciation is provided at the following rates in order to write off each asset over its estimated useful life.
Freehold Property - 1% Straight Line on Buildings
Motor Vehicles - 25% reducing Balance
Fixtures & Fittings - 25% reducing Balance
Computer Equipment - 50% reducing Balance

Valuation information and policy
Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving items.

Other accounting policies
Deferred Taxation
Provision is made at current rates of tax for taxation deferred in respect of material timing differences between the recognition of gains and losses in the financial statements and their recognition in the tax computation, except to the extent that, in the opinion of the directors, there is reasonable probability that the tax liability will not arise in the foreseeable future.
The charge for taxation takes into account taxation deferred as a result of timing differences between the treatment of certain items for taxation and accounting purposes. In general, deferred taxation is recognised in respect of timing differences that have originated but not reversed at the balance sheet date. However, 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 taxation is measured on a non-discounted basis at the tax rates that are expected to apply in periods in which the timing differences reverse, based on tax rates and the law enacted or substantively enacted at the balance sheet date.


Leasing & Hire Purchase
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives. Assets acquired under hire purchase contracts 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 the 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.
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to profit and loss account as incurred.

Pensions
The company operates a defined contribution scheme. Contributions are charged to the profit & loss account as they become payable in accordance with the rules of the scheme