REGISTERED NUMBER: 04522600 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2024

for

Final Flourish Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

Mr R P Hewitson

Mr D J Hewitson

Mr B W D Hewitson

Mrs H M Hewitson

Mrs H Hewitson

Mrs C Hewitson

SECRETARY:

Mr B W D Hewitson

REGISTERED OFFICE:

Saxon Works

South Street

Openshaw

Manchester

M11 2FY

REGISTERED NUMBER:

04522600 (England and Wales)

AUDITORS:

Sterling Partners Limited

Chartered Accountants

Statutory Auditors

2nd Floor, Grove House

774-780 Wilmslow Road

Didsbury

Manchester

Greater Manchester

M20 2DR

The group operates within the aftermarket and off highway exhaust sector, the business has successfully diversified into new areas whilst utilising existing machinery and processes.

The sector had a turbulent year with consolidation up and down the supply chain eroding turnover and margin, this linked with suppliers reducing capacity of none margin making products has made the purchasing of materials a particularly difficult task; however, this has been tempered by increased efficiencies enabling redeployment of resource away from nonvalue added activities and a reduction of raw material and finished good stock holding.

Review of Business

The group has returned a resolute and stable performance in a challenging and competitive market, with turnover being maintained at £8,549,735.

The group continues to keep ahead of its competition with on-going investment in plant and machinery, early in the year saw the purchase of a large diameter bender, as well as robotic welding. This will allow the company to offer innovative products to both new and existing customers, thereby enhancing our position in the current market.

The directors are fully committed to be the future success of business and are confident the company will remain profitable for the foreseeable future.

The directors measure the performance of the group based on the following financial and non-financial KPIs:

Financial KPI's

Turnover: £8,549,735

Gross Profit Margin: 32.6%

Operating Profit Margin: 16.7%

Return on Capital Employed (ROCE): 34.6%

Cash Conversion Ratio: 52.6%

Non-Financial KPI's

On-Time Delivery Rate: 99.2%

Health & Safety: Obtained ISO 45001 Health and Safety Management, 1 reportable incident.

Environmental Impact: Obtained ISO 14001 Environmental Management

Principal Risks and Uncertainties

The risk of raw material and energy price increases is managed by careful negotiation with key suppliers, with alternative or dual supplies being sought where necessary.

The company continues to protect itself from the threat of competition by investing in training and development for its employees, thereby maintaining a high skill base which gives our product and service a competitive edge over inferior offerings.

With regard to the competitive nature of the emissions sector, the Directors believe the sector will still have strong competition through oversupply of the market; however, the Directors remain focused on the need to supply a quality product, and ensure the customer is being serviced to the highest possible standard.

Interest rate risk

The Group is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest risk on its bank overdrafts and loans.

Credit risk

Investments of cash surpluses are made through banks and companies which must fulfill credit rating criteria approved by the Board.

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are reviewed on a regular basis and provision is made to doubtful debts where necessary. The group also adopts a policy of insuring trade debtors.

Liquidity risk

The Group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.

Currency risk

The Group's principal foreign currency exposure arises from trading with overseas companies. The company policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling.

ON BEHALF OF THE BOARD:

Mr B W D Hewitson - Director

30 September 2025

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2024.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of the design and manufacturing of exhaust systems.

DIVIDENDS

No interim dividend was paid during the year. The directors recommend a final dividend of £1,703.37 per share.

The total distribution of dividends for the year ended 31 December 2024 will be £ 511,011 .

The amount of dividends received from subsidiaries to Final Flourish Ltd during the year ended 31st December 2024 totalled £511,011.

The amount of dividends paid from Final Flourish Ltd to shareholders during the year ended 31st December 2024 totalled £511,011.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2024 to the date of this report.

Mr R P Hewitson

Mr D J Hewitson

Mr B W D Hewitson

Mrs H M Hewitson

Mrs H Hewitson

Mrs C Hewitson

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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). 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Sterling Partners Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr B W D Hewitson - Director

30 September 2025

Opinion

We have audited the financial statements of Final Flourish Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and 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 group's and of the parent company affairs as at 31 December 2024 and of the group's 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 group 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

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group 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, except to the extent otherwise explicitly stated in our report, 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 we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. 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.

Opinions 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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 page four, 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 group's and the parent 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 group or the parent 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

.- results of our enquiries of management about their own identification and assessment of the risks of irregularities;

- any matters we identified having obtained and reviewed the entities' documentation of their policies and procedures relating to:

- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

- the matters discussed among the audit engagement team including significant component audit teams and involving relevant internal specialists, including tax, valuations, pensions and IT specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in relation to revenue deferrals. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the entity operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and local tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the entities’ ability to operate or to avoid a material penalty.

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.

Mir Seyed Mokhtassi BSc FCA CTA (Senior Statutory Auditor)

for and on behalf of Sterling Partners Limited

Chartered Accountants

Statutory Auditors

2nd Floor, Grove House

774-780 Wilmslow Road

Didsbury

Manchester

Greater Manchester

M20 2DR

30 September 2025

TURNOVER

8,549,735

9,137,823

Cost of sales

(5,335,201

)

(6,143,968

)

GROSS PROFIT

3,214,534

2,993,855

Distribution costs

(162,990

)

(147,315

)

Administrative expenses

(1,131,450

)

(1,948,005

)

1,920,094

898,535

Other operating income

-

(2,234

)

OPERATING PROFIT

4

1,920,094

896,301

Profit/loss on sale of tang fa

5

-

24,611

1,920,094

920,912

Income from shares in group undertakings

(1

)

(1

)

Interest receivable and similar income

1,332

351

1,921,425

921,262

Amounts written off investments

6

-

(82,160

)

Gain/loss on revaluation of investments

55,282

35,126

1,976,707

874,228

Interest payable and similar expenses

7

(47,289

)

(47,984

)

PROFIT BEFORE TAXATION

1,929,418

826,244

Tax on profit

8

(468,175

)

(193,983

)

PROFIT FOR THE FINANCIAL YEAR

1,461,243

632,261

Profit attributable to:

Owners of the parent

1,461,243

632,261

PROFIT FOR THE YEAR

1,461,243

632,261

OTHER COMPREHENSIVE INCOME

Split out historical revaluation

67,028

-

Current year revaluation

55,282

35,126

Correction to revaluation reserve

(224,382

)

-

Transfers between reserves

102,072

(35,126

)

Income tax relating to components of other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,461,243

632,261

Total comprehensive income attributable to:

Owners of the parent

1,461,243

632,261

FIXED ASSETS

Intangible assets

12

-

-

Tangible assets

13

2,662,870

2,638,148

Investments

14

488,333

433,051

3,151,203

3,071,199

CURRENT ASSETS

Stocks

15

651,715

436,134

Debtors

16

2,222,811

1,706,036

Cash at bank and in hand

800,567

726,336

3,675,093

2,868,506

CREDITORS

Amounts falling due within one year

17

(2,018,992

)

(2,059,329

)

NET CURRENT ASSETS

1,656,101

809,177

TOTAL ASSETS LESS CURRENT LIABILITIES

4,807,304

3,880,376

CREDITORS

Amounts falling due after more than one year

18

(432,096

)

(448,074

)

PROVISIONS FOR LIABILITIES

23

(808,460

)

(815,786

)

NET ASSETS

3,566,748

2,616,516

CAPITAL AND RESERVES

Called up share capital

24

300

300

Revaluation reserve

25

437,941

540,013

Retained earnings

25

3,128,507

2,076,203

SHAREHOLDERS' FUNDS

3,566,748

2,616,516

The financial statements were approved by the Board of Directors and authorised for issue on 30 September 2025 and were signed on its behalf by:

Mr B W D Hewitson - Director

FIXED ASSETS

Intangible assets

12

-

-

Tangible assets

13

-

-

Investments

14

3,246,088

3,219,952

3,246,088

3,219,952

CURRENT ASSETS

Debtors

16

760

760

Cash at bank

447

3,770

1,207

4,530

CREDITORS

Amounts falling due within one year

17

(2,958

)

(2,902

)

NET CURRENT (LIABILITIES)/ASSETS

(1,751

)

1,628

TOTAL ASSETS LESS CURRENT LIABILITIES

3,244,337

3,221,580

CREDITORS

Amounts falling due after more than one year

18

(327,639

)

(323,744

)

NET ASSETS

2,916,698

2,897,836

CAPITAL AND RESERVES

Called up share capital

24

300

300

Revaluation reserve

65,063

-

Retained earnings

2,851,335

2,897,536

SHAREHOLDERS' FUNDS

2,916,698

2,897,836

Company's profit for the financial year

529,873

551,387

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 30 September 2025 and were signed on its behalf by:

Mr B W D Hewitson - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

300

1,892,454

540,013

2,432,767

Changes in equity

Dividends

-

(448,512

)

-

(448,512

)

Total comprehensive income

-

632,261

-

632,261

Balance at 31 December 2023

300

2,076,203

540,013

2,616,516

Changes in equity

Dividends

-

(511,011

)

-

(511,011

)

Total comprehensive income

-

1,563,315

(102,072

)

1,461,243

Balance at 31 December 2024

300

3,128,507

437,941

3,566,748

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

300

2,794,661

-

2,794,961

Changes in equity

Dividends

-

(448,512

)

-

(448,512

)

Total comprehensive income

-

551,387

-

551,387

Balance at 31 December 2023

300

2,897,536

-

2,897,836

Changes in equity

Dividends

-

(511,011

)

-

(511,011

)

Total comprehensive income

-

464,810

65,063

529,873

Balance at 31 December 2024

300

2,851,335

65,063

2,916,698

Cash flows from operating activities

Cash generated from operations

29

1,083,097

1,655,214

Interest paid

(47,289

)

(47,984

)

Tax paid

(133,710

)

(119,710

)

Net cash from operating activities

902,098

1,487,520

Cash flows from investing activities

Purchase of tangible fixed assets

(342,022

)

(628,210

)

Purchase of fixed asset investments

-

(12,002

)

Sale of tangible fixed assets

2,880

49,388

Interest received

1,332

351

Dividends received

(1

)

(1

)

Net cash from investing activities

(337,811

)

(590,474

)

Cash flows from financing activities

Loan repayments in year

(71,706

)

(108,129

)

Capital repayments in year

92,661

99,731

Amount introduced by directors

5,857

31,428

Amount withdrawn by directors

(5,857

)

(182,928

)

Equity dividends paid

(511,011

)

(448,512

)

Net cash from financing activities

(490,056

)

(608,410

)

Increase in cash and cash equivalents

74,231

288,636

Cash and cash equivalents at beginning of year

30

726,336

437,700

Cash and cash equivalents at end of year

30

800,567

726,336

1.	STATUTORY INFORMATION

Final Flourish 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 General 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 as modified by the revaluation of certain assets.

Financial Reporting Standard 102 - reduced disclosure exemptions

The Group has taken advantage of the following disclosure exemptions in preparing these financial statements, whereby a parent company statement of cash flows is not included as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

- the requirements of Section 7 Statement of Cash Flows;

- the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d); and

- the requirements of Section 33 Related Party Disclosure paragraph 33.7.

Basis of consolidation

The consolidated financial statements present the results of the Company and its subsidiaries ("the Group") as a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

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 wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Significant judgements and estimates

Warranties

The group operate a provision for warranties they have given on their products. This is calculated at 3% of annual sales. This is based upon the group's historical refunds.

Investment properties

The investment property is subject to an annual review of fair value. There has not been a formal valuation done since 2015 and the carrying value of the property is evaluated annually by the directors.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:

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

- the Group retains neither continuing managerial involvement to the degree usually associates with ownership nor effective control over the goods sold;

- the amount of turnover can be measured reliably;

- it is probable that the Group will receive the consideration due under the transaction;

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

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the profit and loss account over its useful economic life.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

in accordance with the property

Plant and machinery

-

10% on cost and Straight line over 3 years

Fixtures and fittings

-

10% on cost and Straight line over 3 years

Motor vehicles

-

Straight line over 3 years

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

The Group adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Group. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.

Depreciation is charged so as to allocate the costs of assets less their residual value over their estimated useful lives, using the straight line method.

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within administrative expenses in the consolidated statement of comprehensive income.

Due to a high estimated residual value in relation to land and buildings, whereby depreciation is immaterial, no depreciation is charged. An annual review for impairment is performed.

Non-depreciation of the land and buildings is a departure from the Companies Act 2006, and is necessary to give a true and fair view.

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.

Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in the consolidated statement of comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

Stocks

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition.

Stock provisions are recognised based on obsolete and slow-moving items with reference to quantity of stock held at year end and items sold in the previous 12 months.

Financial instruments

The Group enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties and loans to related parties These basic financial instruments are measured at cost less any impairment.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, 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.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

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 group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

Investments other than group entities

Investments made other than in group entities are initially measured at cost and subsequently measured at fair value through the profit and loss.

Bad debt provision

The directors have reviewed the trading balances owing to the Group from its customers and made adequate provision for any debts where it is considered probable that the amount will not be recovered. The amounts would have otherwise been recognised in trade debtors.