Abbreviated Company Accounts - W MAGES (REWINDS) LIMITED

1Accounting Policies

Basis of measurement and preparation of accounts
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain fixed assets, and in accordance with the Financial Reporting Standard for Smaller Entities (effective April 2008).

The nature of the company's business is such that there can be considerable unpredictable variation in the timing of cash inflows. The company's debt was consolidated in to one loan repayable over twenty five years. The director considers that this refinancing together with a bank overdraft facility will enable the company to meet its day to day working capital requirements. However, the margin of facilities over requirements is not large and, inherently there can be no certainty in relation to these matters. On this basis, the director considers it appropriate to prepare the financial statements on the going concern basis.

Turnover policy
Turnover represents the value, net of value added tax and discounts, of goods provided to customers and work carried out in respect of services provided to customers.

Tangible assets depreciation policy
Depreciation is calculated so as to write off the cost or revaluation of an asset, less its estimated residual value, over the useful economic life of that asset as follows:

Freehold Property - 2% Straight line
Equipment, fixtures and fittings - 25% Reducing balance
Motor Vehicles - 20% Reducing balance

Other accounting policies
Stocks

Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance of obselete and slow moving stock. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

Finance lease agreements

Where the company enters into a lease which entails taking substantially all the risks and rewards of ownership of an asset, the lease is treated as a finance lease. The asset is recorded in the balance sheet as a tangible fixed asset and is depreciated in accordance with the above depreciation policies. Future instalments under such leases, net of finance charges, are included within creditors. Rentals payable are apportioned between the finance element, which is charged to the profit and loss account at a constant rate of charge on the balance of capital repayments outstanding, and the capital element which reduces the outstanding obligation for future instalments.

Operating lease agreements

Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged against profits on a straight line basis over the period of the lease.

Pension costs

The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company. The annual contributions payable are charged to the profit and loss account.

Deferred taxation

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more tax, with the following exception:

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 tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.

Factoring with recourse

The gross amount of the factored debts are shown within assets, and a corresponding liability in respect of the proceeds received from the factor is shown within liabilities. The interest element of the factor's charges and other factoring costs are recognised as they accrue and included in the profit and loss account within the appropriate caption.