REGISTERED NUMBER: 14105705 (England and Wales)

Group Strategic Report,

Report of the Director and

Consolidated Financial Statements

for the Year Ended 31 December 2024

for

Braeriach Holdings Ltd

Page

Company Information

1

Group Strategic Report

2

Report of the Director

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 Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTOR:

W K Fakhry

REGISTERED OFFICE:

44 Russell Square

London

Greater London

WC1B 4JP

REGISTERED NUMBER:

14105705 (England and Wales)

AUDITORS:

Anstey Bond LLP

Statutory Auditors &

Chartered Accountants

1-2 Charterhouse Mews

London

EC1M 6BB

The director presents his strategic report of the company and the group for the year ended 31 December 2024.

The year was marked by weaker overall demand in the whisky trading market, which placed pressure on revenues. In response, Braeriach Holdings Limited acted decisively to strengthen its financial and operational position. Gross margins were improved through disciplined cost control, liquidity was supported by reducing stock levels, and investment continued in best-in-class systems to enhance resilience and efficiency.

These actions reflect the Group's strategy of balancing near-term prudence with long-term investment. While short-term trading conditions remain uncertain, the directors believe that the combination of cost discipline, liquidity management and operational investment provides a strong platform for the Group to capture opportunities and deliver sustainable growth as market conditions evolve.

REVIEW OF BUSINESS

During the year ended 31 December 2024, Braeriach Holdings Limited operated in a weaker demand environment which led to a reduction in revenues to £15.9m (2023: £24.9m). Despite the decline in turnover, the Company improved gross margin to 15.2% (2023: 13.3%), with gross profit of £2.4m (2023: £3.3m). This was achieved through disciplined cost control, efficiency initiatives and tighter purchasing.

Operating performance reflected the reduced revenue base, with an operating loss of £0.2m compared to a profit of £0.3m in 2023. While the fall in sales volumes impacted profitability, the improvement in gross margin demonstrates the Company's ability to adapt its cost base and protect underlying performance.

Liquidity and balance sheet resilience remained a priority. Stock holdings were reduced to £4.2m (2023: £8.3m) to align with prevailing demand and safeguard cash resources, while maintaining the ability to meet customer requirements.

Alongside these measures, the Company invested in the development of best-in-class systems and infrastructure. These investments are designed to enhance operational capability, strengthen governance, and provide the platform to capture new opportunities in the whisky trading market as conditions evolve.

The directors consider that the actions taken in 2024 have strengthened the Group's resilience and positioned it to benefit from opportunities as the market stabilises. The strategy of cost discipline, liquidity management and system investment provides a solid foundation for long-term growth.

FUTURE OUTLOOK

The outlook for the whisky trading sector remains mixed, with ongoing macroeconomic pressures affecting short-term demand. However, Braeriach Holdings Limited is well positioned to benefit from emerging opportunities as markets stabilise and long-term interest in whisky as an asset class continues to grow.

The Board's strategy remains focused on three priorities: maintaining cost discipline, safeguarding liquidity, and building operational systems that provide a competitive advantage. By pursuing this approach, the Group expects to be in a strong position to capture growth opportunities and deliver sustainable value creation over the medium term.

PRINCIPAL RISKS AND UNCERTAINTIES

Braeriach Holdings Limited operates in a sector that is influenced by wider macroeconomic conditions, consumer demand trends, and the valuation of whisky casks. The reduction in revenues during the year under review highlights the potential impact of demand risk on financial performance.

Liquidity risk is also a key consideration given the capital-intensive nature of stockholding in the whisky market. The Group has mitigated this by reducing inventory levels to £4.2m (2023: £8.3m), thereby strengthening cash resources and maintaining flexibility to respond to changes in demand.

Operational resilience remains central to risk management. The Group is investing in best-in-class systems and processes to improve efficiency, enhance governance, and strengthen reporting. These investments will allow the business to adapt quickly to market shifts and capture opportunities as they arise.

Other principal risks include:

- Market risk: fluctuations in demand, consumer preferences and pricing may impact revenue.

- Liquidity risk: careful management of stock and financing arrangements is required to maintain financial flexibility.

- Regulatory risk: the industry remains subject to compliance and governance obligations; failure to meet these may lead to penalties or reputational damage.

- Valuation risk: the value of casks is subject to changes in age profile, quality and brand reputation, which can influence investor appetite and market pricing.

The Group also recognises that long-term success is underpinned by its people and its approach to sustainability. Human capital remains a priority, with ongoing investment in training, development and employee well-being to ensure the skills and culture needed to deliver strategy effectively. In parallel, the Group continues to monitor its environmental impact and is committed to operating in a sustainable and responsible way.

By maintaining cost discipline, safeguarding liquidity, investing in systems and prioritising people and sustainability, Braeriach Holdings Limited believes it is well positioned to mitigate risks and deliver long-term growth.

ON BEHALF OF THE BOARD:

W K Fakhry - Director

30 September 2025

The director presents his report with the financial statements of the company and the group for the year ended 31 December 2024.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2024.

A dividend amount of £Nil (2023 : £74k) has been issued from Cask Industries Ltd (the subsidiary) to Braeriach Holdings Limited (the parent) during the year. No other dividends or distributions have been made from the Group.

DIRECTOR

W K Fakhry held office during the whole of the period from 1 January 2024 to the date of this report.

POLITICAL DONATIONS AND EXPENDITURE

There were no political donations made in the year ended 31 December 2024 (2023 : £Nil).

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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 director is 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 he 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.

AUDITORS

The auditors, Anstey Bond LLP, were appointed on 16th April 2024 and have confirmed their willingness to be re-appointed as Auditor, a proposal for re-appointment will be made at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

W K Fakhry - Director

30 September 2025

Opinion

We have audited the financial statements of Braeriach Holdings Ltd (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 Consolidated 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 group's and of the parent company affairs as at 31 December 2024 and of the group's loss 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 director's 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, 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 Director 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 Director 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 Director.

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 director's remuneration specified by law are not made; or

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

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is 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 director either intends to liquidate the group or the parent company or to cease operations, or has 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 gained an understanding of the legal and regulatory framework applicable to the group and the industry in which it operates, and considered the risk of acts by the group that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example forgery or intentional misrepresentations, or through collusion.

We focussed on laws and regulations which could give rise to material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above, and the further removed non - compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relation to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

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.

Colin Ellis FCCA CF (Senior Statutory Auditor)

for and on behalf of Anstey Bond LLP

Statutory Auditors &

Chartered Accountants

1-2 Charterhouse Mews

London

EC1M 6BB

30 September 2025

TURNOVER

3

15,809

24,905

Cost of sales

(13,447

)

(21,602

)

GROSS PROFIT

2,362

3,303

Administrative expenses

(2,572

)

(2,984

)

OPERATING (LOSS)/PROFIT

5

(210

)

319

Interest payable and similar expenses

6

174

(327

)

LOSS BEFORE TAXATION

(36

)

(8

)

Tax on loss

7

6

17

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(30

)

9

(Loss)/profit attributable to:

Owners of the parent

(30

)

9

(LOSS)/PROFIT FOR THE YEAR

(30

)

9

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(30

)

9

Total comprehensive income attributable to:

Owners of the parent

(30

)

9

FIXED ASSETS

Intangible assets

9

118

125

Tangible assets

10

20

24

Investments

11

-

-

138

149

CURRENT ASSETS

Stocks

12

4,211

8,311

Debtors

13

5,190

2,260

Cash at bank and in hand

403

391

9,804

10,962

CREDITORS

Amounts falling due within one year

14

(5,129

)

(7,363

)

NET CURRENT ASSETS

4,675

3,599

TOTAL ASSETS LESS CURRENT LIABILITIES

4,813

3,748

CREDITORS

Amounts falling due after more than one year

15

(4,470

)

(3,375

)

NET ASSETS

343

373

CAPITAL AND RESERVES

Called up share capital

17

-

-

Retained earnings

18

343

373

SHAREHOLDERS' FUNDS

343

373

The financial statements were approved by the director and authorised for issue on 30 September 2025 and were signed by:

W K Fakhry - Director

FIXED ASSETS

Intangible assets

9

109

115

Tangible assets

10

-

-

Investments

11

816

816

925

931

CREDITORS

Amounts falling due within one year

14

(172

)

(165

)

NET CURRENT LIABILITIES

(172

)

(165

)

TOTAL ASSETS LESS CURRENT LIABILITIES

753

766

CAPITAL AND RESERVES

Called up share capital

17

-

-

Retained earnings

753

766

SHAREHOLDERS' FUNDS

753

766

Company's (loss)/profit for the financial year

(13

)

30

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 director and authorised for issue on 30 September 2025 and were signed by:

W K Fakhry - Director

Called up

share

Retained

Total

capital

earnings

equity

£'000

£'000

£'000

Balance at 1 January 2023

-

364

364

Changes in equity

Total comprehensive income

-

9

9

Balance at 31 December 2023

-

373

373

Changes in equity

Total comprehensive income

-

(30

)

(30

)

Balance at 31 December 2024

-

343

343

Called up

share

Retained

Total

capital

earnings

equity

£'000

£'000

£'000

Balance at 1 January 2023

-

736

736

Changes in equity

Total comprehensive income

-

30

30

Balance at 31 December 2023

-

766

766

Changes in equity

Total comprehensive income

-

(13

)

(13

)

Balance at 31 December 2024

-

753

753

Cash flows from operating activities

Cash generated from operations

1

(1,271

)

(583

)

Interest paid

174

(327

)

Tax paid

-

(181

)

Net cash from operating activities

(1,097

)

(1,091

)

Cash flows from investing activities

Purchase of intangible fixed assets

-

(131

)

Purchase of tangible fixed assets

(9

)

(31

)

Sale of tangible fixed assets

-

1

Net cash from investing activities

(9

)

(161

)

Cash flows from financing activities

New or adjusted loans in year

1,118

316

Net cash from financing activities

1,118

316

Increase/(decrease) in cash and cash equivalents

12

(936

)

Cash and cash equivalents at beginning of year

2

391

1,327

Cash and cash equivalents at end of year

2

403

391

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

2024

2023

£'000

£'000

Loss before taxation

(36

)

(8

)

Depreciation charges

19

14

Finance costs

(174

)

327

(191

)

333

Decrease/(increase) in stocks

4,100

(5,271

)

Increase in trade and other debtors

(2,919

)

(179

)

(Decrease)/increase in trade and other creditors

(2,261

)

4,534

Cash generated from operations

(1,271

)

(583

)

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 31 December 2024

31.12.24

1.1.24

£'000

£'000

Cash and cash equivalents

403

391

Year ended 31 December 2023

31.12.23

1.1.23

£'000

£'000

Cash and cash equivalents

391

1,327

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.1.24

Cash flow

At 31.12.24

£'000

£'000

£'000

Net cash

Cash at bank and in hand

391

12

403

391

12

403

Debt

Debts falling due within 1 year

(165

)

(35

)

(200

)

Debts falling due after 1 year

(3,375

)

(1,095

)

(4,470

)

(3,540

)

(1,130

)

(4,670

)

Total

(3,149

)

(1,118

)

(4,267

)

1.	STATUTORY INFORMATION

Braeriach Holdings Ltd 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 consolidated and separate 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. As accepted by FRS 102 the financial statements have been prepared for a financial year ended 31 December 2024 with the comparative period for the year ending 31 December 2023.

They are prepared on a going concern basis, under the historical cost convention, as modified by the recognition of certain financial assets and liabilities measured at fair value.

The group financial statements are presented in pound sterling (£), monetary amounts in these financial statements are rounded to the nearest thousand represented by the unit k, unless stated otherwise.

The Parent and Subsidiary entity functional and presentation currency is the pound sterling (£).

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group and company accounting policies.

The company has taken advantage of the exemption in section 408 of the Companies Act from presenting its individual profit and loss account.

Going Concern

The group meets its day-to-day working capital requirements through its financing facilities. The current economic conditions continue to create uncertainty over the level of demand for the group’s products. However the group’s forecasts and projections, taking account of a severe but plausible change in trading performance, show that the group should be able to operate within the level of its current facilities. The director has a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. The group therefore continues to adopt the going concern basis in preparing its financial statements.

Basis of consolidation

The group consolidated financial statements include the financial statements of the company and all of its subsidiary undertakings made up to the year ended 31 December 2024 and the comparatives for the year ended 31 December 2023.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Where the group owns less than 50% of the voting powers of an entity but controls the entity by virtue of an agreement with other investors which give it control of the financial and operating policies of the entity, it accounts for that entity as a subsidiary.

Where a subsidiary has different accounting policies to the group, adjustments are made to those subsidiary financial statements to apply the group’s accounting policies when preparing the consolidated financial statements.

Any subsidiary undertakings or associates acquired during the year are included from the dates of change of control or change of significant influence respectively.

All intra-group transactions, balances, income and expenses are eliminated on consolidation. Adjustments are made to eliminate the profit or loss arising on transactions with associates to the extent of the group’s interest in the entity.

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.

During the year the company has entered transactions or hold balances with two related companies; Barrel Industries Limited and Noir 357 Limited of which amounts receivable are due as at 31 December 2024 amounting to £170k (2023 : £341k) and £911k (2023 : £661k) respectively. The balance receivable from Barrel Industries Limited is not believed to be recoverable and has been provided for to reduce the balance to Nil. Services have been received from these related companies and amounts payable and accrued as at the year ended 31 December 2024 total Nil (2023 : £199k) & £1,384k (2023 : £1,209k) respectively.

Turnover

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

Revenue Recognition

The group recognises revenue when (a) the significant risks and rewards of ownership have been transferred to the buyer, (b) the group retains no continuing involvement or control over the goods, (c) the amount of revenue can be measured reliably, (d) it is probable that future economic benefits will flow to the entity. Revenue on shipped goods is recognised at the earliest point of when the significant risks and rewards of ownership of the goods has transferred to the buyer. This is usually at the point that the customer has signed for the delivery of the goods.

Sale of Goods - Wholesale

The group operates a wholesale distribution network for the resale of the stock to other retail entities. Sales of goods are recognised on sale to the customer, which is considered the point of delivery.

Sale of Goods - Retail

The group directly distributes its stock through a retail entity direct to customer. Sales of goods are recognised on sale to the direct customer and receipt of funds.

Sale of Goods - Cask

The group directly trade casks and revenue is recognised in line with ownership having been transferred to the buyer upon invoicing.

Dividend income

Dividend income is recognised when the right to receive payment is established.

Business combinations and goodwill

Business combinations are accounted for by applying the purchase method.

The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity instruments issued plus the costs directly attributable to the business combination.

Contingent consideration is initially recognised at an estimated amount where the consideration is probable and can be measured reliably. Where (i) the contingent consideration is not considered probable or cannot be reliably measured but subsequently becomes probable and measurable or (ii) contingent consideration previously measured is adjusted, the amounts are recognised as an adjustment to the cost of the business combination.

On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights. Where the fair value of contingent liabilities cannot be reliably measured they are disclosed on the same basis as other contingent liabilities.

Goodwill recognised represents the excess of the fair value and directly attributable costs of the purchase consideration over the fair values to the group’s interest in the identifiable net assets, liabilities and contingent liabilities acquired.

Goodwill is amortised over its expected useful life which is estimated to be ten years. Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to the income statement.

Where the cost of the business combination exceeds the fair value of the group’s interest in the assets, liabilities and contingent liabilities acquired, negative goodwill arises. The group, after consideration of the assets, liabilities and contingent liabilities acquired and the cost of the combination, recognises negative goodwill on the balance sheet and releases this to profit and loss, up to the fair value of non-monetary assets acquired, over the periods in which the non-monetary assets are recovered and any excess over the fair value of non-monetary assets in the income statement over the period expected to benefit.’

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.

Patents, Licences, and trademarks are amortised evenly over their useful lives of:

- 10 Years

- 20 Years

Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following basis:

Fixtures and Fittings

5 years straight line

Computer equipment

3 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to the profit or loss.

Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine

whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the 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 individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting sate, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are so recognised in profit or loss.

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.

Employee benefits

The group provides a range of benefits to employees, including annual bonus arrangements, paid holiday arrangements and defined benefit pension plans.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed asses.

The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Retirement benefits

The group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the group has no further payment obligations. The contributions are recognised as an expense when they are due.

Amounts not paid are shown in accruals in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

Distributions to equity holders

Dividends and other distributions to groups shareholders are recognised as a liability in the financial statements in the period in which the dividends and other distributions are approved. These amounts are recognised in the statement of changes in equity.

Borrowing costs

All borrowing costs are recognised in profit or loss in the period in which they are incurred.

Investments - Company

Investment in subsidiary company is held at cost less accumulated impairment losses.

Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowing in current liabilities.

Trade and other debtors

Trade and other debtors are initially recognised at the transaction price and thereafter stated at amortised cost using effective interest method, less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases, the debtors are stated at cost less impairment losses for bad and doubtful debt.

Trade and other creditors

Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method unless the effect of discounting would be immaterial, in which cases they are stated at cost.

Provisions

Provisions are recognised when the group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount of the obligation can be estimated reliably.