Turnover comprises the total amount receivable for goods sold and services provided in the ordinary course of business, net of value added tax, trade discounts and returns.
The company’s revenue is derived from two primary sources:
Sale of used motor vehicles – Revenue from the sale of vehicles is recognised at the point when the significant risks and rewards of ownership have transferred to the buyer, which is typically upon delivery or collection of the vehicle and completion of all sales documentation.
Provision of motor vehicle services – Revenue from repair, maintenance, and other garage services is recognised upon completion of the service provided to the customer. Where services are provided over a period of time, revenue is recognised based on the stage of completion at the reporting date, provided the outcome of the transaction can be estimated reliably.
Revenue is only recognised when it is probable that the economic benefits associated with the transaction will flow to the company and the amount of revenue can be measured reliably.