The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102 section 1A Small Entities "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

At the balance sheet date, the company had net liabilities. The company's major creditor is a company under common control and that company has confirmed that it will not withdraw its financial support to the detriment of the company or its other creditors. The company is now generating income and is becoming more able to meet its own liabilities as they fall due. However, financial support is still provided by its shareholder and associate companies to ensure that this is the case. The directors are satisifed that financial support will not be withdrawn in the foreseeable future. Accordingly, the accounts have been prepared on a going concern basis.

Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover represents income from downloads of music singles, and is included on the basis of the download date.

Production costs are capitalised in the year that the music single is recorded, and amortised once the singles are released. For costs capitalised in the year, as well as for some costs incurred in prior years, not all of the singles had been released at the balance sheet date and therefore amortisation has not yet commenced.