Abbreviated Company Accounts - CASTLE DAWSON 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 January 2015.

Turnover policy
Turnover represents amounts chargeable, net of value added tax, in respect of the sale of goods and services to
customers.

Tangible assets depreciation policy
Depreciation is provided on tangible fixed assets so as to write off the cost or valuation, less any estimated
residual value, over their expected useful economic life as follows:
Asset class Depreciation method and rate
Office equipment 20% Reducing balance
Motor vehicles 20% Reducing balance
Fixtures & fittings 15% Reducing balance

Intangible assets amortisation policy
Positive goodwill is capitalised, classified as an asset on the balance sheet and amortised on a straight line basis
over its useful economic life. It is reviewed for impairment at the end of the first full financial year following the
acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be
recoverable.
Amortisation is provided on intangible fixed assets so as to write off the cost, less any estimated residual value,
over their expected useful economic life as follows:
Asset class Amortisation method and rate
Goodwill 10% Straight Line

Valuation information and policy
Work in progress
Work in progress is valued at the lower of cost and net realisable value, after due regard for obsolete and slow
moving stocks. Net realisable value is based on selling price less anticipated costs to completion and selling
costs. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

Other accounting policies
Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual
arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract
that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares
are issued, any component that creates a financial liability of the company is presented as a liability in the
balance sheet. The corresponding dividends relating to the liability component are charged as interest expense in
the profit and loss account.
Hire purchase and leasing
Rentals payable under operating leases are charged in the profit and loss account on a straight line basis over the
lease term.Assets held under finance leases, which are leases where substantially all the risks and rewards of ownership of
the asset have passed to the company, are capitalised in the balance sheet as tangible fixed assets and are
depreciated over the shorter of the lease term and their useful lives. The capital elements of future obligations
under the leases are included as liabilities in the balance sheet. The interest element of the rental obligation is
charged to the profit and loss account over the period of the lease and represents a constant proportion of the
balance of capital repayments outstanding. Assets held under hire purchase agreements are capitalised as
tangible fixed assets and are depreciated over the shorter of the lease term and their useful lives. The capital
element of future finance payments is included within creditors. Finance charges are allocated to accounting
periods over the length of the contract and represent a constant proportion of the balance of capital repayments
outstanding.