REGISTERED NUMBER: 13861106 (England and Wales)

SEVENTY SEVEN COMPANY HOLDINGS LIMITED

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

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 Statement of Financial Position

11

Company Statement of Financial Position

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Statement of Cash Flows

15

Notes to the Consolidated Statement of Cash Flows

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

G W Briggs-Price

D Briggs-Price

A P Briggs-Price

SECRETARY:

REGISTERED OFFICE:

SMC Motorhomes

Northern Road

Newark

Nottinghamshire

NG24 2ET

REGISTERED NUMBER:

13861106 (England and Wales)

SENIOR STATUTORY AUDITOR:

Rachel Rudkin FCCA

AUDITORS:

Duncan & Toplis Audit Limited, Statutory Auditor

14 London Road

Newark

Nottinghamshire

NG24 1TW

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

REVIEW OF BUSINESS

The directors aim to present a balanced and comprehensive review of the development and performance of the group during the year and its position at the period end. The review is consistent with the size and complexity of the group and is written in the context of the risks and uncertainties that the group faced.

The main trading subsidiary in the group achieved a profit before tax of £2.9M compared to £4.3M in the previous year. Sales have increased by 5%, mainly driven by an increase in used vehicle sales. The financial position at the year end shows an increase in net assets of £1.8M.

KEY PERFORMANCE INDICATORS

The directors use a range of performance measures to monitor and manage the group's trading subsidiary. The performance measures are split into financial and non-financial key performance indicators as set out below:

Profit ratios:

Gross profit margin - 11.2% (2023: 14.7%)

Net profit margin - 7.3% (2023: 11.3%)

Liquidity ratio:

Current ratio - 2.4 (2023: 3.0)

Activity ratios:

Debtor days - 1 (2023: 2)

Creditor days - 96 (2023: 62)

Stock holding days - 181 (2023: 152)

Capital ratio:

Stock / Capital employed - 0.9 (2023: 0.8)

The above KPIs are calculated and reviewed on a regular basis by the directors and used to monitor and manage the company's performance.

Creditor days have fallen as have stock holding days due to the high demand for vehicles. Debtor days are minimal as vehicles are not released until payment is received.

SECTION 172(1) STATEMENT

The directors of the group act in accordance with the duties set out in section 172(1) of the Companies Act 2006 to promote the success of the group for the benefit of its members, and in doing so have regard (amongst other matters) to:

- The likely consequences of any decision in long term

- The interests of the group`s employees

- The need to foster the group`s business relationships with suppliers, customers and others

- The impact of the group`s operation on the community and the environment

- The desirability of the group maintaining a reputation for high standards of the business conduct

- The need to act fairly as between members of the group

Longevity and stakeholders are at the forefront of the group`s decision making process. Informed, calculated decisions are made to ensure the long-term future of the business and continued support for its stakeholders.

Recognition and maintenance of the symbiotic relationship between suppliers, employees and customers is of paramount importance in the group`s long term objectives.

The group acknowledge that employees play a fundamental role in achieving the long-term goals and maintaining a reputation for high standards.

Employees are provided with training for industry recognised qualifications, competitive remuneration and an environment to progress within the business.

The group works closely with a select number of manufacturers, ensuring a more focussed relationship and clearer lines of communications.

This relationship with the manufacturer assists the group with delivering positive outcomes for our customers, delivering high standards, as we strive to meet their needs.

The group appreciates the important role it plays within the local community. The group understands the positive impacts of offering long term futures for its employees and the reassurances and benefits this gives within the local community. Every year the group with the help of its employees, take part in charitable events. Community clubs and societies benefit from various sponsorships.

In recent times the group as strived to reduce its carbon footprint. This as seen significant investment in solar and battery technology. Generating greener energy. Future projects are being explored to reduce the carbon footprint further, such as water reclamation.

The group strives towards maintaining high standards. To assist with achieving these goals they are a member of the National Caravan Council (NCC) and are an accredited Fiat Professional service centre.

The group is an owner manager family business. All members are involved in the key decisions made by the group.

The directors’ responsibilities towards shareholders are directly interconnected with their responsibilities towards future shareholders of the group.

FUTURE DEVELOPMENTS

The quality motorhome market remains buoyant and the company continues to explore marketing opportunities to build profitable trade. The company has re-established its presence at national and regional trade shows as restrictions eased. The trading premises at Newark have also been expanded subsequent to the year-end.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors continually monitor the key risks facing the group together with assessing the controls used for managing these risks. The board of directors formally reviews and documents the principal risks facing the business at least annually.

Other principal risks and uncertainties facing the group are derived from general economic uncertainty and the ability of suppliers to meet high demand. Exposure to currency risk is managed through the use of fixed rate contracts and options.

ON BEHALF OF THE BOARD:

G W Briggs-Price - 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 ACTIVITIES

The principal activities of the group in the year under review were those of sales of motorhomes and cars, bodywork repairers and the servicing of vehicles.

DIVIDENDS

The directors recommend a final dividend per share as follows:

A Ordinary £1

-

£ 16.00

B Ordinary £1

-

£ 45.72

C Ordinary £1

-

£ 46.66

D Ordinary £1

-

£ 60.86

E Ordinary £1

-

£ 93.34

The total distribution of dividends for the year ended 31 December 2024 will be £450,000

DIRECTORS

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

G W Briggs-Price

D Briggs-Price

A P Briggs-Price

Other changes in directors holding office are as follows:

A K Briggs-Price ceased to be a director after 31 December 2024 but prior to the date of this report.

STREAMLINED ENERGY AND CARBON REPORTING

Energy consumption

The total consumption of energy in the year equated to 460,455kWh.

The total usage in relation to scope one emissions was 264,217kWh.

The total usage in relation to scope two emissions was 196,238kWh.

Methodology

The adopted methodology used is based on the Greenhouse Gas Protocol Corporate Reporting Standard reporting on equivalent CO2 emissions from organisational boundary.

Information has been gathered from utility supplier invoices and collated into kWh for all corresponding UK based operations, directly owned or operated by Seventy Seven Company Limited (i.e. the organisational boundary).

These have been converted to equivalent tonnes of carbon dioxide (tCO2e) using the published UK Government GHG Conversion Factors for Company Reporting for 2024.

Ratios

An intensity ratio in which the company monitors is tCO2e v £1,000,000 turnover.

In 2024, this equated to emissions of 2.2 tCO2e per £1,000,000 of turnover.

Measures taken to improve efficiency

During 2024 we undertook the following improvements to reduce our energy consumption and carbon emissions:

Installation of battery storage for use in conjunction with previously installed solar panels.

From our existing solar panels installations, we generated 83,342 of kWh of electricity offsetting 17.3 tonnes of equivalent carbon emissions.

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;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:

G W Briggs-Price - Director

30 September 2025

Opinion

We have audited the financial statements of Seventy Seven Company Holdings 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 Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Statement of Cash Flows, 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 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 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:

We have identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial experience, knowledge of the sector, a review of regulatory and legal correspondence and through discussions with Directors and other management obtained as part of the work required by auditing standards. We have also discussed with the Directors and other management the policies and procedures relating to compliance with laws and regulations. We communicated laws and regulations throughout the team and remained alert to any indications of non-compliance throughout the audit

The potential impact of different laws and regulations varies considerably. Firstly, the company is subject to laws and regulations that directly impact the financial statements (for example financial reporting legislation) and we have assessed the extent of compliance with such laws as part of our financial statements audit. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including risk of override of controls) and determined that the principal risks were related to management bias in accounting estimates and judgemental areas of the financial statements such as depreciation of tangible fixed assets, as well as the risk of inappropriate journal entries to increase reported profitability. Audit procedures performed by the engagement team included the identification and testing of material and unusual journal entries and challenging management on key accounting estimates, assumptions and judgements made in the preparation of the financial statements. We carried out detailed substantive tests on accounting estimates, including reviewing the methods used by management to make those estimates, re-performing the calculation, and reviewing the outcome of prior year estimates.

Secondly, the company is subject to other laws and regulations where the consequence for non-compliance could have a material effect on the amounts or disclosures in the financial statements. We identified the following areas as those most likely to have such an effect: Health and Safety regulations, Vehicle operating licences, and Employment laws. This inspection included a review of the business operating licences for any evidence of non-compliance, in addition to the assessment of the company's employment and health and safety controls. Through these procedures, if we became aware of any non-compliance, we considered the impact on the procedures performed on the related financial statement items.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. The further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. As with any audit, there is a greater risk of non-detection of irregularities as these may involve collusion, intentional omissions of the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations

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.

Rachel Rudkin FCCA (Senior Statutory Auditor)

for and on behalf of Duncan & Toplis Audit Limited, Statutory Auditor

14 London Road

Newark

Nottinghamshire

NG24 1TW

30 September 2025

TURNOVER

3

40,456,254

38,538,987

Cost of sales

35,928,617

32,872,018

GROSS PROFIT

4,527,637

5,666,969

Administrative expenses

1,407,723

1,200,615

OPERATING PROFIT

5

3,119,914

4,466,354

Interest receivable and similar income

109,074

81,432

3,228,988

4,547,786

Interest payable and similar expenses

6

294,128

194,063

PROFIT BEFORE TAXATION

2,934,860

4,353,723

Tax on profit

7

923,696

1,063,970

PROFIT FOR THE FINANCIAL YEAR

2,011,164

3,289,753

Profit attributable to:

Owners of the parent

2,011,164

3,289,753

PROFIT FOR THE YEAR

2,011,164

3,289,753

OTHER COMPREHENSIVE INCOME

Merger reserve

13,439,276

13,439,276

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

13,439,276

13,439,276

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

15,450,440

16,729,029

Total comprehensive income attributable to:

Owners of the parent

15,450,440

16,729,029

FIXED ASSETS

Property, plant and equipment

10

3,075,814

2,538,303

Investments

11

-

-

3,075,814

2,538,303

CURRENT ASSETS

Inventories

12

17,805,717

13,680,277

Debtors

13

1,185,491

1,070,829

Cash at bank and in hand

8,080,479

7,665,530

27,071,687

22,416,636

CREDITORS

Amounts falling due within one year

14

11,487,666

7,599,680

NET CURRENT ASSETS

15,584,021

14,816,956

TOTAL ASSETS LESS CURRENT LIABILITIES

18,659,835

17,355,259

CREDITORS

Amounts falling due after more than one year

15

(300,000

)

(700,000

)

PROVISIONS FOR LIABILITIES

20

(305,615

)

(162,203

)

NET ASSETS

18,054,220

16,493,056

CAPITAL AND RESERVES

Called up share capital

21

11,000

11,000

Merger reserves

22

13,439,276

13,439,276

Retained earnings

22

4,603,944

3,042,780

SHAREHOLDERS' FUNDS

18,054,220

16,493,056

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:

G W Briggs-Price - Director

FIXED ASSETS

Property, plant and equipment

10

-

-

Investments

11

7,700,000

7,700,000

7,700,000

7,700,000

CURRENT ASSETS

Debtors

13

586,973

456,973

CREDITORS

Amounts falling due within one year

14

826,973

456,973

NET CURRENT LIABILITIES

(240,000

)

-

TOTAL ASSETS LESS CURRENT LIABILITIES

7,460,000

7,700,000

CAPITAL AND RESERVES

Called up share capital

21

11,000

11,000

Retained earnings

7,449,000

7,689,000

SHAREHOLDERS' FUNDS

7,460,000

7,700,000

Company's profit for the financial year

210,000

246,973

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:

G W Briggs-Price - Director

Called up

share

Retained

Merger

Total

capital

earnings

reserves

equity

£

£

£

£

Balance at 1 January 2023

11,000

-

13,439,276

13,450,276

Changes in equity

Dividends

-

(246,973

)

-

(246,973

)

Total comprehensive income

-

3,289,753

-

3,289,753

Balance at 31 December 2023

11,000

3,042,780

13,439,276

16,493,056

Changes in equity

Dividends

-

(450,000

)

-

(450,000

)

Total comprehensive income

-

2,011,164

-

2,011,164

Balance at 31 December 2024

11,000

4,603,944

13,439,276

18,054,220

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

11,000

7,689,000

7,700,000

Changes in equity

Dividends

-

(246,973

)

(246,973

)

Total comprehensive income

-

246,973

246,973

Balance at 31 December 2023

11,000

7,689,000

7,700,000

Changes in equity

Dividends

-

(450,000

)

(450,000

)

Total comprehensive income

-

210,000

210,000

Balance at 31 December 2024

11,000

7,449,000

7,460,000

Cash flows from operating activities

Cash generated from operations

1

2,934,152

2,550,331

Interest paid

(294,128

)

(194,063

)

Tax paid

(1,233,234

)

(845,911

)

Net cash from operating activities

1,406,790

1,510,357

Cash flows from investing activities

Purchase of tangible fixed assets

(686,198

)

(88,815

)

Sale of tangible fixed assets

23,595

5,363

Interest received

109,074

81,432

Net cash from investing activities

(553,529

)

(2,020

)

Cash flows from financing activities

Loan repayments in year

(400,000

)

(400,000

)

Amount introduced by directors

723,354

-

Amount withdrawn by directors

(311,666

)

(385,824

)

Equity dividends paid

(450,000

)

(246,973

)

Net cash from financing activities

(438,312

)

(1,032,797

)

Increase in cash and cash equivalents

414,949

475,540

Cash and cash equivalents at beginning of year

2

7,665,530

7,189,990

Cash and cash equivalents at end of year

2

8,080,479

7,665,530

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

2024

2023

£

£

Profit before taxation

2,934,860

4,353,723

Depreciation charges

126,628

129,513

Profit on disposal of fixed assets

(1,536

)

-

Finance costs

294,128

194,063

Finance income

(109,074

)

(81,432

)

3,245,006

4,595,867

Increase in inventories

(4,125,440

)

(2,448,217

)

Decrease/(increase) in trade and other debtors

75,868

(76,223

)

Increase in trade and other creditors

3,738,718

478,904

Cash generated from operations

2,934,152

2,550,331

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

8,080,479

7,665,530

Year ended 31 December 2023

31.12.23

1.1.23

£

£

Cash and cash equivalents

7,665,530

7,189,990

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.24

Cash flow

At 31.12.24

£

£

£

Net cash

Cash at bank and in hand

7,665,530

414,949

8,080,479

7,665,530

414,949

8,080,479

Debt

Debts falling due within 1 year

(400,000

)

-

(400,000

)

Debts falling due after 1 year

(700,000

)

400,000

(300,000

)

(1,100,000

)

400,000

(700,000

)

Total

6,565,530

814,949

7,380,479

1.	GENERAL INFORMATION

Seventy Seven Company Holdings Limited is a private limited company, limited by shares, incorporated in England and Wales. The address of the registered office is given in the company information on page one of these financial statements. The nature of the company's operations and principal activities are detailed in the report of the directors on page three.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

The directors have reasonable expectations that the group has adequate resources to continue in existence for the foreseeable future. The group has therefore adopted the going concern basis in preparing its consolidated financial statements.

Basis of consolidation

The group financial statements consolidate Seventy Seven Company Limited at the reporting date.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the group's accounting policies, management is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The 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.

There are no critical accounting judgements or estimation uncertainty that, in the opinion of the directors, will have a material effect on the consolidated financial statements.

Revenue

Revenue represents amounts charged to customers for goods and services provided during the year, excluding value added tax and trade discounts.

Vehicle sales and parts sales are recognised upon delivery to the customer, or upon collection by the customer. Servicing and workshop sales are recognised in the period in which the services are rendered. Forecourt sales are recognised at the point of sale.

Property, plant and equipment

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

Freehold property - 2% on cost

Short leasehold - 33% on cost and 10% on cost

Plant and fixtures - 15% on reducing balance

Motor vehicles - 25% on reducing balance

Tangible fixed assets are stated at cost (or deemed cost) or valuation less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended.

Inventories

Inventories are stated at the lower of cost and fair value less costs to complete and sell, after making due allowance for obsolete and slow moving items. Inventories are accounted for on a first-in-first-out basis.

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 profit or loss 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 that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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 statement of financial position 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.

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.

Financial instruments

The group has chosen to adopt the Sections 11 and 12 of FRS 102 in respect of financial instruments.

Basic financial assets, including trade and other debtors and cash and bank balances are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in profit or loss.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

Basic financial liabilities, including trade and other creditors and directors loan accounts are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Leasing commitments

Assets obtained under finance leases are capitalised in the statement of financial position and are depreciated over their estimated useful lives or the lease term whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of future payments is treated as a liability.