Abbreviated Company Accounts - HERONGATE HOMES LIMITED

1Accounting Policies

Basis of measurement and preparation of accounts
The full financial statements, from which these abbreviated accounts have been extracted, 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, and the fair value of the right to consideration in exchange for the performance of its contractual obligations.

Tangible assets depreciation policy
Depreciation is provided on all tangible fixed assets so as to write off the cost over their expected useful economic life as follows:

Fixtures and fittings 25% straight line
Motor vehicles 25% straight line
Office equipment 25% straight line
Computer equipment 25% straight line

Valuation information and policy
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
Going concern
These financial statements have been prepared on a going concern basis. This basis is considered appropriate as the company is reliant on the support of its director who has indicated that this support will continue to be forthcoming for the foreseeable future. If this basis proves to be inappropriate, adjustments will have to be made to adjust the value of assets to their recoverable amounts, to provide for any further liabilities which might arise and reclassify fixed assets as current assets.

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.

4Transactions with directors