Abbreviated Company Accounts - A M BEATON 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.

Tangible assets depreciation policy
Tangible fixed assets held for the company's own use are stated at cost less accumulated depreciation and accumulated impairment losses.
Depreciation is provided at rates calculated to write off the costs of fixed assets, less their estimated residual value, over their expected useful lives using the following rates:-
Leasehold improvements 2% straight line
Motor vehicles 15% reducing balance
Office equipment 15% reducing balance
Plant and machinery 15% reducing balance
Fixtures and fittings 15% reducing balance

At each balance sheet date, the company reviews the carrying amount of its tangible fixed assets to determine whether there is any indication that any items have suffered an impairment loss. If any such indication exists, the recoverable amount of an asset is estimated in order to determine the extent of the impairment loss, if any. Where it is not possible to estimate the recoverable amount of the asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Other accounting policies
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.
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to the profit and loss account on a straight line basis.
Tangible fixed assets acquired under finance leases or hire purchase contracts are capitalised and depreciated in the same manner as other tangible fixed assets. The related obligations, net of future finance charges, are included in creditors.
Dairy Herd
The livestock herd is stated at initial cost under the herd basis. No depreciation is provided unless the director considers there has been a permanent diminution in value. This policy is in order to give a true and fair view.
In accordance with industry practice the herd has been shown in fixed assets in these financial statements.

Stocks
Stocks are stated at the lower of cost and net realisable value after making due allowance for obsolete and slow moving stocks. Net realisable value represents estimated selling price less costs to complete and sell.

Deferred taxation
Deferred taxation is provided on the liability method to take account of timing differences between the treatment of certain items for accounts purposes and their treatment for tax purposes. Tax deferred or accelerated is accounted for in respect of all material timing differences.