REGISTERED NUMBER: 14579582 (England and Wales)

Anand Group Ltd

Group Strategic Report, Report of the Directors and

Consolidated Financial Statements

For The Year Ended 30th June 2025

Page

Company Information

1

Group Strategic Report

2

to

3

Report of the Directors

4

Report of the Independent Auditors

5

to

7

Consolidated Income Statement

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

to

24

DIRECTORS:

H S Anand

Mrs J K Anand

Mrs H K Anand

Mrs J Sethi

K S Sethi

SECRETARY:

H S Anand

REGISTERED OFFICE:

Meridian House

Centurian Way

Meridian Business Park

Leicester

Leicestershire

LE19 1WH

REGISTERED NUMBER:

14579582 (England and Wales)

AUDITORS:

Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

The directors present their strategic report of the company and the group for the year ended 30th June 2025.

REVIEW OF BUSINESS

The group's turnover has increased by 2.8% whilst the gross profit percentage achieved is similar to that achieved in 2024. Both the group and parent company have a healthy net assets position as shown on the relevant statement of financial position.

The risks facing the group are those relating to technical innovations of products and of changes in the world economic climate on consumer, and therefore wholesaler demand. The group is always sensitive to new and innovational trends in the market and hopes to take advantage of any profitable new UK and overseas markets as they open up.

The Key Financial Performance Indicators are

2025

2024

2023

Debtors days

39

37

43

Creditor days

27

21

39

Trading ratio

4.88%

6.74%

10.07

Liquidity ratio

646.34%

677.96%

449.41%

The Key Non -Financial performance indicators are as follows:

Customers

Retention rating is high because:

Top 5

Top customers remain loyal

Percentage of top 5 customer turnover

to total company turnover

28%

27%

26%

Suppliers

Supplier continuity is high

Top 5

Top 4 suppliers ranked in same order

each year.

Percentage of company purchases

75%

75%

75%

Staff Turnover Low - Indicating high morale and satisfaction. Very few joiners or leavers in any year.

PRINCIPAL RISKS AND UNCERTAINTIES

The risks facing the group are those relating to technical innovations of products and of changes in the UK and

world economic climate on consumer, and therefore wholesaler demand.

SECTION 172(1) STATEMENT

Directors' statement of compliance with duty to promote the success of the group and its parent company.

During the year , the directors have had regard to the matters set out in S172 (1) (a) to (f) of the Companies Act 2006

whilst performing their duties. Whilst making decisions the directors ensure that they have acted in good faith, in a way they believe would promote the success of the parent company and its subsidiaries for the benefit of the members. Specifically, the directors have considered the following:-

a. The likely consequences of any decision in the long term;

b. The interests of the group's employees;

c. The need to foster the group's business relationships with suppliers , customers and others;

d. The impact of the operations of the group on the community and the environment;

e. The desirability of the group maintaining a reputation for high standards of business conduct; and

f. The need to act fairly between members of the parent company which controls all the wholly owned subsidiaries

S172(1) (a) The Likely consequences of any decision in the long term.

The Directors understand the business and the environment in which it operates. This is key to understanding the likely consequences of any long-term decisions . There is a plan for increased growth in the company's business in a cautious and risk -averse manner.

S172(1) (b) The interests of the group's employees.

The directors recognise that the group's employees are key to the business and its success.Staff retention is achieved by the prioritizing of employee wellbeing such that employees work in a humane ,safe and healthy environment which aims to encourage that employees develop to the best of their potential.

S172(1) (c) The need to foster the group's business relationships with suppliers, customers and others.

The directors recognise the important of relationships with our supply chain and the need to continue to build relationships with our key suppliers. We actively engage with suppliers throughout the year to ensure our respective plans align with one -another.

The group is committed to maintaining good customer relations and continues to spend considerable time to ensure customer satisfaction.

S172(1) (d) The impact of the group's operations on the community and the environment.

The group recognise the importance of minimising the impact of our operations on the community and environment , which is why it is core to our strategy.

The group purchases from supplier companies which recycle batteries.

S172 (1) (e) The desirability of the group maintaining a reputation for high standards of business conduct.

The group gives a significant proportion of its income to a charitable settlement registered in England & Wales which has funded many local and national charitable causes.

S172(1) (f) The need to act fairly between members of the parent company.

The parent company is a family run company where the long term ties of kindred and friendship combine to produce a courteous and a respectful atmosphere.The wholly owned subsidiary companies are run on the same lines.

RESEARCH AND DEVELOPMENT AND FUTURE DEVELOPMENTS

The group does not manufacture or develop the products which it sells but purchases them on a wholesale basis.

The group is sensitive to innovational market trends and always seeks to take advantage of any profitable new

United Kingdom or overseas markets for new products as they open up.

FINANCIAL INSTRUMENT RISK

The group does not have any bank borrowings. The group has a healthy net current assets and net assets position as shown on the statement of financial position.

The movement in foreign exchange rates affects the values of trade debtors, trade creditors and foreign currency bank accounts and the directors carefully monitor movements in those currencies.

ON BEHALF OF THE BOARD:

H S Anand - Director

7th January 2026

The directors present their report with the financial statements of the company and the group for the year ended 30th June 2025.

DIVIDENDS

No dividends will be distributed for the year ended 30th June 2025.

The interim dividends paid by the group amounted to £nil ( 2024:£nil).

DIRECTORS

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

H S Anand

Mrs J K Anand

Mrs H K Anand

Mrs J Sethi

K S Sethi

GREENHOUSE GAS EMISSIONS,ENERGY CONSUMPTION & ENERGY EFFICIENCY

Greenhouse gas emissions, energy consumption and energy efficiency disclosures are not being given because in the directors' opinion the consumption of energy is less than 40,000 k/wh per annum.

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 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, Cheney & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

H S Anand - Director

7th January 2026

Opinion

We have audited the financial statements of Anand Group Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 30th June 2025 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 30th June 2025 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 qualified 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:

Irregularities , including fraud , are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities , outlined above, to detect material misstatements in respect of irregularities, including fraud.

We obtained an understanding of the legal and regulatory frameworks applicable to the parent company and group and the sector in which it operates. We determine that the following laws and regulations were most significant: the Companies Act 2006, UK direct and indirect taxation laws , the Consumer Rights Act, Employment Legislation and Health and Safety legislation affecting staff working in the warehouse and office staff using computer systems. The group has Marine Insurance for goods being exported via ship on the oceans of the world.

We obtained an understanding of how the parent company and group are complying with those legal and regulatory frame works by making enquiries of management.

We have discussed with management the risk of incorrect VAT treatment in sales transactions , including export sales of goods to Europe and the rest of the world and have concluded that the client directors and staff are sufficiently experienced concerning these regulations that the risk of material misstatement is low.

There are no critical judgements of an unusual nature . The cut off of sales , purchases and stock movements is covered by the directors involvement. The valuation of stock is performed annually by the managing director based on recent cost prices and he supervises the annual stock count.

We have undertaken high levels of substantive testing of balances in the statement of financial position and have performed a detailed analytical review of the income statement.

Prior to commencement of the audit staff were briefed on the risk assessment of the susceptibility of the parent company and the group financial statements to material misstatement , including fraud .

Audit procedures performed included:

-identifying and assessing the design and effectiveness of controls management has in place to prevent and detect fraud;and

-understanding how the directors considered and addressed the potential for override of controls or inappropriate influence over the financial reporting process; and

-challenging assumptions and judgements made by management in significant accounting estimates where appropriate;and

-identifying and testing journal entries , in particular any journal entries posted with unusual account combinations, as appropriate; and

-assessing the extent of compliance with laws and regulations.

At the completion stage of the audit the results of audit tests were re-examined to ensure that they were consistent with our knowledge of the parent company and the group and did not warrant further investigation of transactions and balances.

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.

Paul Sparks FCA FCCA (Senior Statutory Auditor)

for and on behalf of Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

7th January 2026

TURNOVER

3

56,841,148

55,278,437

Cost of sales

(50,884,555

)

(50,115,242

)

GROSS PROFIT

5,956,593

5,163,195

Distribution costs

(194,000

)

(178,639

)

Administrative expenses

(3,107,414

)

(2,795,091

)

OPERATING PROFIT

5

2,655,179

2,189,465

Interest receivable and similar income

814,405

739,250

3,469,584

2,928,715

Amounts written off investments

6

-

(913,750

)

PROFIT BEFORE TAXATION

3,469,584

2,014,965

Tax on profit

7

(868,582

)

(744,148

)

PROFIT FOR THE FINANCIAL YEAR

2,601,002

1,270,817

Profit attributable to:

Owners of the parent

2,601,002

1,270,817

PROFIT FOR THE YEAR

2,601,002

1,270,817

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

2,601,002

1,270,817

Total comprehensive income attributable to:

Owners of the parent

2,601,002

1,270,817

FIXED ASSETS

Tangible assets

9

1,214,256

1,218,199

Investments

10

-

-

1,214,256

1,218,199

CURRENT ASSETS

Stocks

11

2,482,427

3,379,241

Debtors

12

8,613,983

7,728,904

Cash at bank and in hand

13

17,398,108

14,066,689

28,494,518

25,174,834

CREDITORS

Amounts falling due within one year

14

4,408,568

3,713,335

NET CURRENT ASSETS

24,085,950

21,461,499

TOTAL ASSETS LESS CURRENT LIABILITIES

25,300,206

22,679,698

CREDITORS

Amounts falling due after more than one year

15

(9,056

)

-

PROVISIONS FOR LIABILITIES

17

(86,250

)

(75,800

)

NET ASSETS

25,204,900

22,603,898

CAPITAL AND RESERVES

Called up share capital

18

720

720

Retained earnings

19

25,204,180

22,603,178

SHAREHOLDERS' FUNDS

25,204,900

22,603,898

The financial statements were approved by the Board of Directors and authorised for issue on 7th January 2026 and were signed on its behalf by:

H S Anand - Director

FIXED ASSETS

Tangible assets

9

-

-

Investments

10

620

620

620

620

CURRENT ASSETS

Debtors

12

1,901

336

Cash at bank and in hand

13

155,073

150,305

156,974

150,641

CREDITORS

Amounts falling due within one year

14

17,143

16,077

NET CURRENT ASSETS

139,831

134,564

TOTAL ASSETS LESS CURRENT LIABILITIES

140,451

135,184

CAPITAL AND RESERVES

Called up share capital

18

720

720

Retained earnings

19

139,731

134,464

SHAREHOLDERS' FUNDS

140,451

135,184

Company's profit for the financial year

5,267

134,464

The financial statements were approved by the Board of Directors and authorised for issue on 7th January 2026 and were signed on its behalf by:

H S Anand - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1st July 2023

100

21,332,361

21,332,461

Changes in equity

Issue of share capital

620

-

620

Total comprehensive income

-

1,270,817

1,270,817

Balance at 30th June 2024

720

22,603,178

22,603,898

Changes in equity

Total comprehensive income

-

2,601,002

2,601,002

Balance at 30th June 2025

720

25,204,180

25,204,900

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1st July 2023

100

-

100

Changes in equity

Issue of share capital

620

-

620

Total comprehensive income

-

134,464

134,464

Balance at 30th June 2024

720

134,464

135,184

Changes in equity

Total comprehensive income

-

5,267

5,267

Balance at 30th June 2025

720

139,731

140,451

Cash flows from operating activities

Cash generated from operations

1

3,546,213

2,194,883

Tax paid

(926,072

)

(542,587

)

Net cash from operating activities

2,620,141

1,652,296

Cash flows from investing activities

Purchase of tangible fixed assets

(149,051

)

(157,447

)

Sale of tangible fixed assets

26,000

36,980

Interest received

814,405

739,250

Net cash from investing activities

691,354

618,783

Cash flows from financing activities

New loans in year

19,924

-

Share issue

-

620

Net cash from financing activities

19,924

620

Increase in cash and cash equivalents

3,331,419

2,271,699

Cash and cash equivalents at beginning of year

2

14,066,689

11,794,990

Cash and cash equivalents at end of year

2

17,398,108

14,066,689

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

2025

2024

£

£

Profit before taxation

3,469,584

2,014,965

Depreciation charges

126,993

141,205

Profit on disposal of fixed assets

-

(2,299

)

Impairment of Fixed Asset Investment

-

913,750

Finance income

(814,405

)

(739,250

)

2,782,172

2,328,371

Decrease in stocks

896,814

1,339,806

(Increase)/decrease in trade and other debtors

(885,080

)

529,958

Increase/(decrease) in trade and other creditors

752,307

(2,003,252

)

Cash generated from operations

3,546,213

2,194,883

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 30th June 2025

30.6.25

1.7.24

£

£

Cash and cash equivalents

17,398,108

14,066,689

Year ended 30th June 2024

30.6.24

1.7.23

£

£

Cash and cash equivalents

14,066,689

11,794,990

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.7.24

Cash flow

At 30.6.25

£

£

£

Net cash

Cash at bank and in hand

14,066,689

3,331,419

17,398,108

14,066,689

3,331,419

17,398,108

Debt

Finance leases

-

(19,924

)

(19,924

)

-

(19,924

)

(19,924

)

Total

14,066,689

3,311,495

17,378,184

1.	STATUTORY INFORMATION

Anand Group 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 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.

Anand Group Limited was formed on the 9th January 2023 in order to re-organise the group administratively by facilitating the share for share exchange of new shareholdings in ,a new parent company, Anand Group Limited in exchange for shareholdings in Anand International Limited and Anand Distribution Limited on 3rd July 2023.

Anand Group Limited is a parent company with 2 directly and 4 indirectly wholly owned subsidiaries , all private limited companies , limited by share capital as follows:

Anand International Limited ( England & Wales) which is a trading company selling consumer batteries and smoking requisites on a wholesale basis.Anand International Limited has three subsidiary companies.

Tee Tee Co.Limited (England & Wales) and House of Batteries Holdings Limited (England & Wales) are dormant and are held to protect the trade names .30th June 2024

Anand Emerald Ltd ( Ireland) is effectively a branch selling operation which sells locally or in Europe on wholesale terms to Republic of Ireland ( ROI) customers products only sourced from or by Anand International Limited on a matched ROI Sales to an equivalent purchase from or by Anand International Limited . A gross profit margin is added to cover local overheads. Anand Emerald Ltd ( Ireland) has no trading stock as it has no warehouse facilities .The proceeds of ROI Sales are used to settle the purchase ledger debt due to the parent company and other suppliers.

Anand Distribution Limited ( England & Wales) is the company which owns the warehouse from which the group trades and it has one subsidiary company, Daewoo International Europe Ltd which traded in broadly the same sector as Anand International Limited , but on a very much smaller scale, until it ceased trading on 31st January 2024.

Accordingly consolidated financial statements have been prepared on the merger accounting method as the subsidiary companies were all acquired on a share for share exchange , with no cash or cash equivalent consideration passing ,on the first day of the trading in the year to 30th June 2024, namely Monday 3rd July 2023.

The merger accounting rules use existing cost values with no requirement to use fair values in the acquisition.

Basis of consolidation

Consolidated financial statements have been prepared on the merger accounting method as the subsidiary companies were all acquired on a share for share exchange , with no cash or cash equivalent consideration passing ,on the first trading day of the trading year to 30th June 2024, namely Monday 3rd July 2023.

The merger accounting rules use existing cost values with no requirement to use fair values in the acquisition.

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.

Critical accounting judgements and key sources of estimation uncertainty

The group makes estimates and assumptions concerning the future. The directors are also required to exercise judgement in the process of applying the company`s accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

In preparing these financial statements , the directors have made the following judgements:

> Recoverability and carrying value of trading stock

The directors review the market value and demand for the stock on a periodic basis to ensure stock is recorded in the financial statements have lower of cost and net realisable value. Any provision for impairment is recorded against the carrying values of stocks. The directors use their knowledge of market conditions, historical experiences and estimate of future events to assess the future demand for the company's products and achievable selling prices.

> Recoverability of trade and other debtors

Trade and other debtors are recognised to the extent that they are judged recoverable. The directors' reviews are performed to estimate the level of reserves required for irrecoverable debt. Provisions are made specifically against invoices where recoverability is uncertain.

The directors make allowances for doubtful debts based on an assessment of the recoverability of debtors.Allowances are applied to debtors where events or changes in circumstances indicate that the carrying amounts may not be recoverable. The directors specifically analyse historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of the provision for doubtful debts. Where the expectation is different from the original estimate, such a difference will impact the carrying value of debtors and the charge in the profit and loss account.

> Provisions

A provision is recognised when the company has a present legal or constructive obligation as a result of a past event for which it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flow that reflects the time value of money and the risks specific to the liability.

Whether a present obligation is probable or not requires judgement. The nature and type of risks for these provisions differ, the directors`s judgement is applied regarding the nature and extent of obligations in deciding if an outflow of resources is probable or not.

> Depreciation, amortisation and residual values

The directors have reviewed the asset lives and associated residual values of all fixed asset classes, and have concluded that asset lives and residual values are appropriate.

The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account.Residual value assessments consider issues such as future market conditions , the remaining life of the asset and projected disposal values.

> Taxation

There are many transactions and calculations for which the ultimate tax determination is uncertain. The group recognizes liabilities for anticipated tax issues based on estimates of whether additional taxes will be due.

The directors estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies.