Abbreviated Company Accounts - KAPPA BLU LTD

1Accounting Policies

Basis of measurement and preparation of accounts
The financial statements have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice and Northern Irish statute comprising the Companies Act 2006. Accounting Standards generally accepted in the United Kingdom, for preparing financial statements giving a true and fair view are those published by the Institute of Chartered Accountants in Ireland and issued by the Accounting Standards Board.

Turnover policy
Turnover is stated net of trade discounts, VAT and similar taxes and derives from the provision of goods falling within the company's ordinary activities.

Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses. Turnover is calculated as that proportion of total contract value which costs to date bear to total expected costs for that contract.

Tangible assets depreciation policy
All tangible fixed assets are initially recorded at historic cost. Depreciation is provided on all tangible fixed assets, other than freehold land and investment properties, at rates calculated to write off the cost or valuation, less estimated residual value, of each asset systematically over its expected useful life, as follows:

Plant and machinery - 15% reducing balance
Office equipment - 25% reducing balance

Other accounting policies
Going concern
The directors consider that the losses incurred in the current and previous years of trading have been caused mainly by the problems affecting the construction industry in Northern Ireland caused by the fall in value in residential properties alongside interest paid on borrowings incurred to fund property development. Interest has been charged to the profit and loss account rather than being capitalised as part of stock. The directors continue to strive to ensure that profits are generated as the properties are developed and sold.

The company is therefore dependent on the continued support of its bankers and directors. The directors are working closely together with the company's bankers to reduce the overall indebtedness of the company. In addition the company's future operating performance will also be affected by the general economic, financial and business conditions, many of which are beyond the company's control and these material uncertainties may cast significant doubt on the ability of the company to continue as a going concern. The secured creditor has undertaken their own valuations of the company's land and have security over the company assets. No other significant creditors are at risk as the bank continue to authorise and approve any payment made by the company.

The directors having considered these circumstances, have agreed that the company's assets will be realised to reduce bank borrowings and that the company can continue in operational existence for the forseeable future until this is achieved. For this reason they continue to adopt the going concern basis in preparing the financial statements.

Stock and work in progress
Stocks are stated at the lower of cost and net realisable value. In the case of finished goods and work in progress, cost is defined as the aggregate cost of raw material, direct labour and the attributable proportion of direct production overheads based on normal activity. Net realisable value is based on normal selling price, less further costs expected to be incurred to completion and disposal.

Long term contracts
Amounts recoverable on contracts which are included in debtors are stated at cost, plus attributable profit to the extent that this is reasonably certain after making provision for contingencies, less any losses incurred or foreseen in bringing contracts to completion, and less amounts received as progress payments. Cost for this purpose includes valuations of all work done by sub-contractors, whether certified or not and all overheads other than those relating to the general administration of the relevant companies. For any contracts where receipts exceed the book value of work done, the excess is included in creditors as payments on account.

Deferred taxation
Full provision for deferred tax assets and liabilities is provided at current tax rates on differences that arise between the recognition of gains and losses in the financial statements and their recognition in the tax computation, except for differences arising on the revaluation of fixed assets (if no commitment to sell), or gains on any asset sold that will benefit from rollover relief.

3Fixed assets Investments
As at 31 March 2014, Kappa Blu Ltd owned 50% of the ordinary share capital of Crawford & Garrett (Carryduff) Limited.