VW Heritage Parts Centre Limited - Limited company accounts 18.2

REGISTERED NUMBER: 03294341 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 APRIL 2018

FOR

VW HERITAGE PARTS CENTRE LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Statement of Comprehensive Income

8

Balance Sheet

9

Statement of Changes in Equity

10

Cash Flow Statement

11

Notes to the Cash Flow Statement

12

Notes to the Financial Statements

13

DIRECTORS:

M Rickard

P Howard

B Dines

REGISTERED OFFICE:

47 Dolphin Road

Shoreham-by Sea

West Sussex

BN43 6PB

REGISTERED NUMBER:

03294341 (England and Wales)

AUDITORS:

Feist Hedgethorne Limited

Statutory Auditors

Chartered Accountants

Preston Park House

South Road

Brighton

East Sussex

BN1 6SB

BANKERS:

National Westminster Bank plc

257 New Church Road

Hove

East Sussex

BN3 4EQ

The directors present their strategic report for the year ended 30 April 2018.

REVIEW OF BUSINESS

The company has continued to benefit from their larger premises which has allowed efficiencies to continue and a larger

range of parts held. The directors are pleased with the performance of the company in 2018 and turnover has increased

by 2.6% due to the VW car enthusiast market continuing to be buoyant. The company has continued to grow sales by

increasing the product range, investing in ecommerce and marketing and committing to excellent customer service. The

company continues to keep close control over its costs and seeks to maximise its profit margins.

The results for the year are shown in the Statement of Comprehensive Income on page 8. The directors' consider that the

company's Balance Sheet as detailed on page 9 shows a satisfactory position at the year end.

The key financial highlights are as follows:

2018

2017

Change

Turnover

£12,549,642

£12,227,182

+2.6%

Gross profit

£4,550,091

£4,590,532

-0.9%

Gross profit margin

36.26%

37.54%

-3.4%

Operating profit margin

9.48%

13.94%

-32.0%

Average number of employees

75

75

0%

The directors have made themselves aware of all relevant audit information. The auditors have been informed of all of

this information.

PRINCIPAL RISKS AND UNCERTAINTIES

There are a number of risks and uncertainties that can impact the performance of the company, some of which are

beyond the control of the company and its Board. These trends and risks are the focus of monthly management meetings

where company performance is assessed versus budget, forecasts and prior year results. Key performance indicators are

also used to benchmark operational performance. An annual assessment of trends and risks is also an integral part of the

company's annual review of its strategic plan and budget. A combination of all of this enables the Board to determine

and assess the company's risk environment.

The principal risks and uncertainties facing the company are outlined below:

Market Conditions

The principal risk affecting the company is the sales performance and the retention of market share to enable the

company to continue to generate and grow revenue in future years. The immediate risk to the company would be

underperforming sales resulting in a decline in revenue.

Customer Credit Risk

Credit risk is the risk of financial loss to the company if a customer fails to meet its contractual obligations and arises

principally from the company's trade and other receivables from customers.

Management has a credit policy in place and the exposure to credit risk is monitored on an on-going basis. Credit

evaluations are performed on all customers requiring credit over a certain amount. The company does not require

collateral in respect of financial assets

Financial Instruments Risk

The majority of the company's turnover is generated from UK sales. However, the company also sells goods in the EU

and is therefore at risk of currency exchange rates. The company uses forward foreign currency contracts to reduce

exposure to foreign exchange rates by fixing the rate of any material payments in a foreign currency. Hedge accounting

is used when certain criteria is met, as explained in the accounting policy note on page 15.

PRINCIPAL RISKS AND UNCERTAINTIES (CONTINUED)

Liquidity Risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.

The company aims to mitigate liquidity risk by managing cash generation by its operations and applying cash collection

targets.

ON BEHALF OF THE BOARD:

B Dines - Director

17 September 2018

The directors present their report with the financial statements of the company for the year ended 30 April 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the retail and wholesale sale of parts and

accessories for Classic Volkswagens.

DIVIDENDS

The total distribution of dividends for the year ended 30 April 2018 will be £3,349,000 (2017: £400,000).

DIRECTORS

The directors shown below have held office during the whole of the period from 1 May 2017 to the date of this report.

M Rickard

P Howard

B Dines

Other changes in directors holding office are as follows:

Ms N J Swaden - resigned 28 September 2017

D W Ward - resigned 28 September 2017

FINANCIAL INSTRUMENTS

Details of financial instruments are provided in the strategic report on page 2 and the company's accounting policy for

financial instruments is provided on page 15.

GOING CONCERN

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company

has adequate resources to continue in existence for the foreseeable future. The company therefore continues to adopt the

going concern basis in preparing its financial statements.

FUTURE DEVELOPMENTS

The directors aim to maintain the management policies which have resulted in the group's growth in recent years. They

consider that the next year will show a further growth in sales from continuing operations.

DISCLOSURE IN THE STRATEGIC REPORT

Certain matters required by regulation to be dealt with in the annual report have been dealt with in the Strategic Report

rather than in the Directors' Report. These include principal risks and uncertainties.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements

in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors

have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not

approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the

company and of the profit or loss of the company for that period. In preparing these financial statements, the directors

are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the

company's transactions and disclose with reasonable accuracy at any time the financial position of the company and

enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for

safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud

and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act

2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken

as a director in order to make himself aware of any relevant audit information and to establish that the company's

auditors are aware of that information.

AUDITORS

The auditors, Feist Hedgethorne Limited, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

ON BEHALF OF THE BOARD:

B Dines - Director

17 September 2018

Opinion

We have audited the financial statements of VW Heritage Parts Centre Limited (the 'company') for the year ended

30 April 2018 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity,

Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of

significant accounting policies. The financial reporting framework that has been applied in their preparation is

applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial

Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting

Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 30 April 2018 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.

Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the

financial statements section of our report. We are independent of the company in accordance with the ethical

requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard,

and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit

evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to

you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic

Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors

thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of

assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing

so, consider whether the other information is materially inconsistent with the financial statements or our knowledge

obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we

conclude that there is a material misstatement of this other information, we are required to report that fact. We have

nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit,

we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you

if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on pages four and five, the directors are

responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and

for such internal control as the directors determine necessary to enable the preparation of financial statements that are

free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a

going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of

accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic

alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from

material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs

(UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic

decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting

Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those

matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent

permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's

members as a body, for our audit work, for this report, or for the opinions we have formed.

Peter Hedgethorne (Senior Statutory Auditor)

for and on behalf of Feist Hedgethorne Limited

Statutory Auditors

Chartered Accountants

Preston Park House

South Road

Brighton

East Sussex

BN1 6SB

19 September 2018

TURNOVER

3

12,549,642

12,227,182

Cost of sales

(7,999,551

)

(7,636,650

)

GROSS PROFIT

4,550,091

4,590,532

Administrative expenses

(3,776,011

)

(3,218,160

)

774,080

1,372,372

Other operating income

4

415,543

332,620

OPERATING PROFIT

6

1,189,623

1,704,992

Income from participating interests

49,000

-

Interest receivable and similar income

3,585

7,797

1,242,208

1,712,789

Interest payable and similar expenses

7

(18,817

)

(24,512

)

PROFIT BEFORE TAXATION

1,223,391

1,688,277

Tax on profit

8

(218,765

)

(298,324

)

PROFIT FOR THE FINANCIAL YEAR

1,004,626

1,389,953

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,004,626

1,389,953

FIXED ASSETS

Tangible assets

10

262,793

271,246

Investments

11

147,000

147,000

409,793

418,246

CURRENT ASSETS

Stocks

12

3,595,139

3,508,438

Debtors

13

822,954

1,662,725

Cash at bank and in hand

489,634

1,195,776

4,907,727

6,366,939

CREDITORS

Amounts falling due within one year

14

(1,780,483

)

(1,507,653

)

NET CURRENT ASSETS

3,127,244

4,859,286

TOTAL ASSETS LESS CURRENT LIABILITIES

3,537,037

5,277,532

CREDITORS

Amounts falling due after more than one year

15

(609,508

)

-

PROVISIONS FOR LIABILITIES

19

(41,117

)

(46,746

)

NET ASSETS

2,886,412

5,230,786

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Retained earnings

21

2,885,412

5,229,786

SHAREHOLDERS' FUNDS

2,886,412

5,230,786

The financial statements were approved by the Board of Directors on 17 September 2018 and were signed on its behalf by:

B Dines - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 May 2016

1,000

4,239,833

4,240,833

Changes in equity

Dividends

-

(400,000

)

(400,000

)

Total comprehensive income

-

1,389,953

1,389,953

Balance at 30 April 2017

1,000

5,229,786

5,230,786

Changes in equity

Dividends

-

(3,349,000

)

(3,349,000

)

Total comprehensive income

-

1,004,626

1,004,626

Balance at 30 April 2018

1,000

2,885,412

2,886,412

Cash flows from operating activities

Cash generated from operations

1

975,503

1,065,036

Interest paid

(18,817

)

(24,512

)

Tax paid

(340,084

)

(294,053

)

Net cash from operating activities

616,602

746,471

Cash flows from investing activities

Purchase of tangible fixed assets

(81,605

)

(76,124

)

Interest received

3,585

7,797

Dividends received

49,000

-

Net cash from investing activities

(29,020

)

(68,327

)

Cash flows from financing activities

New loans received in year

1,000,000

1,051,123

Loan repayments in year

(140,493

)

(1,355,885

)

New loans made in year

(2,010,302

)

-

Amount introduced by directors

56,071

-

Amount withdrawn by directors

-

(56,071

)

Equity dividends paid

(199,000

)

(400,000

)

Net cash from financing activities

(1,293,724

)

(760,833

)

Decrease in cash and cash equivalents

(706,142

)

(82,689

)

Cash and cash equivalents at beginning of year

2

1,195,776

1,278,465

Cash and cash equivalents at end of year

2

489,634

1,195,776

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2018

2017

£

£

Profit before taxation

1,223,391

1,688,277

Depreciation charges

88,529

87,395

Loss on disposal of fixed assets

1,531

1,274

Finance costs

18,817

24,512

Finance income

(52,585

)

(7,797

)

1,279,683

1,793,661

Increase in stocks

(86,701

)

(475,392

)

Decrease/(increase) in trade and other debtors

13,269

(147,590

)

Decrease in trade and other creditors

(230,748

)

(105,643

)

Cash generated from operations

975,503

1,065,036

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these

Balance Sheet amounts:

Year ended 30 April 2018

30.4.18

1.5.17

£

£

Cash and cash equivalents

489,634

1,195,776

Year ended 30 April 2017

30.4.17

1.5.16

£

£

Cash and cash equivalents

1,195,776

1,278,465

3.	MAJOR NON-CASH TRANSACTIONS

Dividends of £3,349,000 were paid during the year, of which £3,150,000 was used to clear the inter-company

loan account of VW Heritage Holdings Limited.

1.	STATUTORY INFORMATION

VW Heritage Parts Centre Limited is a private company, limited by shares , registered in England and Wales.

The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The presentation currency of the financial statements is the Pound Sterling (£), which is the functional currency

of the company. Monetary amounts in these financial statements are rounded to the nearest pound.

The financial statements contain information about VW Heritage Parts Centre Limited as an individual company.

This information is included in the consolidated financial statements of it's parent, VW Heritage Holdings

Limited, whose registered office is 47 Dolphin Road, Shoreham-by Sea, West Sussex BN43 6PB.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party

transactions with its parent company, VW Heritage Holdings Limited which owns 100% of the shares in the

company.

Significant judgements and estimates

Preparation of the financial statements requires management to make significant judgements and estimates and

these estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates

are recognised in the period in which the estimate is revised if the revision affects only that period, or in the

period of the revision and future periods if the revision affects both current and future periods.

Key sources of estimation uncertainty:

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives

and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They

are amended when necessary to reflect current estimates, based on technological advancement, future

investments, economic utilisation and the physical condition of the assets. The carrying amount of tangible fixed

assets is £262,793 (2017: £271,246) as noted in note 10.

The company considers whether investments are impaired. Where an indication of impairment is identified the

recoverable value requires estimation. The carrying amount of investments is £147,000 (2017: £147,000) as

noted in note 11.

A stock provision is booked for cases where the realisable value from sales of the stock item is estimated to be

lower than the stock carrying value. The provision is estimated taking into account various factors, including

prevailing sales prices of stock items, and losses associated with slow moving stock items. This provision

totalled £326,563 (2017: £275,516) and the carrying amount of closing stock and goods in transit is £3,595,139

(2017: £3,508,438) as noted in note 12.

The company makes an estimate of the recoverable value of trade and other debtors. When assessing the

impairment of trade debtors, management considers factors including the current credit rating of the debtor, the

ageing profile of debtors and historical experience. During the year £2,929 (2017: £1,053) of trade debtors were

written off as unrecoverable and management considered that a provision should be made of £51,201 (2017:

£38,275) for doubtful debts. The carrying amount of trade debtors is £452,704 (2017: £519,363) as noted in note

13.

Significant judgements and estimates (continued)

The significant judgements have been made by management in preparing these financial statements include:

The company has entered into commercial property leases as a lessee and it obtains use of property, plant and

equipment. The classification of such leases as operating or finance lease requires the company to determine,

based on an evaluation of the terms and conditions of the arrangements, whether it retains or acquires the

significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and

liability to be recognised in the statement of financial position.

Turnover

Turnover represents the fair value of consideration received or receivable net of VAT and trade discounts.

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and

the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or

receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also

be met before revenue is recognised:

Sale of goods

Revenue form the sale of goods is invoiced and recognised at the point goods are dispatched to customers and

when all the following conditions are satisfied:

- The company has transferred the significant risks and rewards of ownership to the buyer;

- The company retains neither continuing managerial involvement to the degree usually associated with

ownership nor effective control over the goods sold;

- The amount of revenue can be measured reliably;

- It is probable that the company will receive the consideration due under the transaction; and

- The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Tangible fixed assets

Tangible fixed assets held for the company's own use are stated at cost less accumulated depreciation and

accumulated impairment losses.

Costs includes costs directly attributable to making the asset capable of operating as intended by management.

Depreciation is provided at the following annual rates in order to write off each asset over its useful life or, if

held under a finance lease, over the lease term, whichever is the shorter.

Website costs

-

straight line over 5 years

Fixtures and fittings

-

25% on reducing balance

Motor vehicles

-

25% on reducing balance

Computer equipment

-

33% on reducing balance

Impairment review

At each balance sheet date, the company reviews the carrying amount of its 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 an asset, the company estimates the recoverable amount of the

cash-generating unit to which the asset belongs.

Investments in associates

Investments in associate undertakings are recognised at cost. Dividends received from associated companies are

included in other income.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow

moving items.

Financial instruments

The company enters into basic financial instruments transactions that result in the recognition of financial assets

and liabilities such as trade and other accounts receivable and payable, loans from banks and other third parties

and loans to and from related parties.

Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are

measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to

be paid or received. However if the arrangements of a short-term instrument constitutes a financing transaction,

like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not

a market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow

discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an

asset's carrying amount and the present value of the estimated cash flows discounted at the asset's original

effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any

impairment loss is the current effective interest rate determined under the contract. If evidence of impairment is

found, an impairment loss is recognised in the profit and loss account.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between

an asset's carrying amount and best estimate, which is an approximation of the amount that the company would

receive for the asset if it were to be sold at the balance sheet date. If evidence of impairment is found, an

impairment loss is recognised in the profit and loss account.

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an

enforceable right to set off the recognised amounts and there is an intention to settle on a net basis as to realise

the asset and settle the liability simultaneously.

The company uses forward foreign currency contracts to reduce exposure to foreign exchange rates. Derivative

financial instruments are initially measured at fair value on the date on which a derivative contract is entered into

and are subsequently measured at fair value through profit or loss. Derivative are carried as assets when the fair

value is positive and as liabilities when the fair value is negative. There is no impact in the accounts because the

differences at the year end are not material.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive

Income, except to the extent that it relates to items recognised in other comprehensive income or directly in

equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or

substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance

sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from

those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that

have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the

timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they

will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the

balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at

the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the

lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension

scheme are charged to profit or loss in the period to which they relate.

Going concern

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the

company has adequate resources to continue in existence for the foreseeable future. The company therefore

continues to adopt the going concern basis in preparing its financial statements.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2018

2017

£

£

United Kingdom

7,123,296

7,337,857

Europe

3,256,099

2,948,546

International

2,170,247

1,940,779

12,549,642

12,227,182