Abbreviated Company Accounts - ARU BAGGING 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 net invoiced sales of services, excluding value added tax.

Tangible assets depreciation policy
In accordance with the Financial Reporting Standard for Small Entities, the freehold investment property is included in the balance sheet at its open market value. The valuation is made by the directors of the company. Any changes in its value will be charged/credited to a revaluation reserve. Any permanent deficit on individual properties will be charged to the profit and loss account.
The vehicle shown in the balance sheet is a classic car which, in the opinion of the directors, had held its value and no depreciation had been provided thereon for the overriding purpose of the accounts to show a true and fair view. However, the trading purpose of its purchase has not materialised and it has been sold at a substantial loss after the year end. Consequently, the vehicle has been depreciated by the amount required to bring it to its resale value.

Other accounting policies
HIRE PURCHASE
Assets obtained under hire purchase contracts are capitalised in the balance sheet and depreciated over their estimated useful lives. The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of future payments is treated as a liability.