The Company has elected to apply the provisions of Section 11 "Basic Financial Instruments" of FRS 102 to all of its
financial instruments.
Financial instruments are recognised in the Company's statement of financial position when the Company becomes party
to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a
legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise
the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their
transaction price including transaction costs and are subsequently carried at their amortised cost using the effective
interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the futurereceipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and
most other receivables due with the operating cycle fall into this category of financial instruments.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements
entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the
deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at
their transaction price after transaction costs. When this constitutes a financing transaction. whereby the debt instrument
is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted
where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business
from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they
represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are
measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is
immaterial.