REGISTERED NUMBER: 10909109 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2025

FOR

SPL J HOLDINGS LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

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

DIRECTORS:

S Jablon

Ms K Y Chan

P Jablon

C K J Yau

REGISTERED OFFICE:

1 Rosoman Place

London

EC1R 0JY

REGISTERED NUMBER:

10909109 (England and Wales)

AUDITORS:

Numera Partners LLP

Statutory Auditors

4th Floor

Charles House

108-110 Finchley Road

London

NW3 5JJ

The directors present their strategic report of the company and the group for the year ended 31 August 2025.

REVIEW OF BUSINESS

The principal activity of the group is the wholesale and retail supply of fashion and optical frames and goods in global markets.

The group previously reacted to past events by reducing costs and restructuring where possible and controlling the costs with the growth post these events.

The group showed positive improvements with the optical and luxury markets.

The results in 2026 are expected to show stable results in irrespective of unstable global market climate.

The group's key performance indicators are:

Sales: £13,594,189 (2024: £13,648,128)

Gross profit: £7,272,495 (2024: £7,248,845)

Net profit before tax: £852,468 (2024: £1,047,624)

EBITDA: £959,334 (2024: £1,139,784 )

Other key performance indicators are customer satisfaction and human resource development. These are considered excellent.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks associated with this industry relate to the market cycle as driven by the general economic performance of the UK and overseas. This manifests itself in dramatic changes in the seasonal cycle which are regularly reviewed by the senior management team to limit the consequent impact on resource productivity and group profitability. Improved buying and season planning policies are expected to vastly improve future performance.

Although the group and industry have adjusted accordingly in relation to recent global factors, uncertainties relating to conflict and political/economic situations in certain territories may remain a potential risk for the period.

FINANCIAL RISK

The group's operations expose it to a number of financial risks including changes in price risks, credit risks, liquidity risks, interest rate risks. The group has a risk management policy that seeks to limit financial risk by monitoring debt and credit risks. The group does not use any derivative financial instruments to manage interest rate costs and as such no hedge accounting is applied.

Given the size of the business, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the board and thereby the board implements the group's finance policy.

PRICE RISK

The group is exposed to price risk due to normal inflationary increases in prices of goods and services.

CREDIT RISK

The group implements policies that require appropriate credit checks on potential customers before credit is afforded to those customers. The amount of exposure is subject to specific limits set by these metrics and the board.

LIQUIDITY RISK

The group operates within the confines of its banking facilities, with the group's shareholders providing long-term finance to ensure flexibility and the availability of sufficient funds for operations and expansion.

INTEREST RATE RISK

The group has limited interest bearing liabilities. The directors regularly review the interest rate policies in light of changes or expected changes in the group's operations.

BUSINESS RISK

Business risks, which the group faces, mainly coming from its competitors and general economic conditions including conflict in territories and global economic issues.

ON BEHALF OF THE BOARD:

S Jablon - Director

21 May 2026

The directors present their report with the financial statements of the company and the group for the year ended 31 August 2025.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of a holding company owning and controlling various UK and foreign trading subsidiaries, which are engaged in the wholesale and retail supply of fashion and optical frames and goods.

DIVIDENDS

No dividends will be distributed for the year ended 31 August 2025.

DIRECTORS

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

S Jablon

Ms K Y Chan

P Jablon

C K J Yau

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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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;

-	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, Numera Partners LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

S Jablon - Director

21 May 2026

Opinion

We have audited the financial statements of SPL J Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 August 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 31 August 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 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, 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. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

- We enquired of management the systems and controls the company has in place, the areas of the financial statement that are mostly susceptible to the risk of irregularities and fraud, and whether there was any known, suspected or alleged fraud.

- We obtained an understanding of the legal and regulatory framework applicable to the company. We determined that the following were most relevant: FRS 102 and Companies Act 2006 and employment law.

- We considered the incentives and opportunities that exist in the company, including the extent of management bias, which present a potential for irregularities and fraud to be perpetuated, and tailored our risk assessment accordingly.

- Using our knowledge of the company, together with the discussions held with the company at the planning stage, we formed a conclusion on the risk of misstatement due to irregularities including fraud and tailored our procedures according to this risk assessment.

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

- Identifying and testing journal entries and the overall accounting records, in particular those that were significant and unusual.

- Reviewing the financial statement disclosures and determining whether accounting policies have been appropriately applied.

- Reviewing and challenging the assumptions and judgements used by management in their significant accounting systems.

- Assessing the extent of compliance, or lack of, with relevant laws and regulations.

- Enquiry of management, those charged with governance and the entity's solicitors around actual and potential litigation and claims.

- Testing key revenue lines, in particular cut-off, for evidence of management bias.

- Obtaining third-party confirmation of material bank and loan balances.

- Documenting and verifying all significant related party balances and transactions.

- Reviewing documentation such as the company board minutes, correspondence with the solicitors, for discussions of irregularities including fraud.

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. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations.

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.

Giles Cohen (Senior Statutory Auditor)

for and on behalf of Numera Partners LLP

Statutory Auditors

4th Floor

Charles House

108-110 Finchley Road

London

NW3 5JJ

21 May 2026

Note:

Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

TURNOVER

3

13,594,189

13,648,128

Cost of sales

6,321,694

6,399,283

GROSS PROFIT

7,272,495

7,248,845

Distribution costs

12,215

5,915

Administrative expenses

6,475,650

6,277,475

6,487,865

6,283,390

784,630

965,455

Other operating income

71,558

82,491

OPERATING PROFIT

5

856,188

1,047,946

Interest payable and similar expenses

7

3,720

322

PROFIT BEFORE TAXATION

852,468

1,047,624

Tax on profit

8

14,639

7,253

PROFIT FOR THE FINANCIAL YEAR

837,829

1,040,371

Profit attributable to:

Owners of the parent

837,829

1,040,371

PROFIT FOR THE YEAR

837,829

1,040,371

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

837,829

1,040,371

Total comprehensive income attributable to:

Owners of the parent

837,829

1,040,371

FIXED ASSETS

Intangible assets

10

129,000

147,000

Tangible assets

11

170,464

227,829

Investments

12

-

-

299,464

374,829

CURRENT ASSETS

Stocks

13

2,277,638

2,211,235

Debtors

14

1,617,146

1,819,180

Cash at bank and in hand

3,655,493

2,885,771

7,550,277

6,916,186

CREDITORS

Amounts falling due within one year

15

1,610,194

1,820,867

NET CURRENT ASSETS

5,940,083

5,095,319

TOTAL ASSETS LESS CURRENT LIABILITIES

6,239,547

5,470,148

PROVISIONS FOR LIABILITIES

17

11,666

11,666

NET ASSETS

6,227,881

5,458,482

CAPITAL AND RESERVES

Called up share capital

18

206

206

Share premium

19

4,999,897

4,999,897

Retained earnings

19

1,227,778

458,379

SHAREHOLDERS' FUNDS

6,227,881

5,458,482

The financial statements were approved by the Board of Directors and authorised for issue on 21 May 2026 and were signed on its behalf by:

S Jablon - Director

FIXED ASSETS

Intangible assets

10

129,000

147,000

Tangible assets

11

-

-

Investments

12

1,144

1,144

130,144

148,144

CURRENT ASSETS

Debtors

14

4,835,992

4,770,619

Cash at bank

1,876

652

4,837,868

4,771,271

CREDITORS

Amounts falling due within one year

15

85,594

12,803

NET CURRENT ASSETS

4,752,274

4,758,468

TOTAL ASSETS LESS CURRENT LIABILITIES

4,882,418

4,906,612

CAPITAL AND RESERVES

Called up share capital

18

206

206

Share premium

19

4,999,897

4,999,897

Retained earnings

19

(117,685

)

(93,491

)

SHAREHOLDERS' FUNDS

4,882,418

4,906,612

Company's loss for the financial year

(24,194

)

(12,821

)

The financial statements were approved by the Board of Directors and authorised for issue on 21 May 2026 and were signed on its behalf by:

S Jablon - Director

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 September 2023

206

(581,992

)

4,999,897

4,418,111

Changes in equity

Profit for the year

-

1,040,371

-

1,040,371

Total comprehensive income

-

1,040,371

-

1,040,371

Balance at 31 August 2024

206

458,379

4,999,897

5,458,482

Changes in equity

Profit for the year

-

837,829

-

837,829

Total comprehensive income

-

837,829

-

837,829

Balance at 31 August 2025

206

1,296,208

4,999,897

6,296,311

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 September 2023

206

(80,670

)

4,999,897

4,919,433

Changes in equity

Deficit for the year

-

(12,821

)

-

(12,821

)

Total comprehensive income

-

(12,821

)

-

(12,821

)

Balance at 31 August 2024

206

(93,491

)

4,999,897

4,906,612

Changes in equity

Deficit for the year

-

(24,194

)

-

(24,194

)

Total comprehensive income

-

(24,194

)

-

(24,194

)

Balance at 31 August 2025

206

(117,685

)

4,999,897

4,882,418

Cash flows from operating activities

Cash generated from operations

1

794,387

587,819

Interest paid

(3,720

)

-

Tax paid

(384

)

(369

)

Net cash from operating activities

790,283

587,450

Cash flows from investing activities

Purchase of tangible fixed assets

(75,416

)

(73,934

)

Net cash from investing activities

(75,416

)

(73,934

)

Cash flows from financing activities

Intercompany loan movement

54,855

(163,381

)

Interest paid

-

(322

)

Net cash from financing activities

54,855

(163,703

)

Increase in cash and cash equivalents

769,722

349,813

Cash and cash equivalents at beginning of year

2

2,885,771

2,535,958

Cash and cash equivalents at end of year

2

3,655,493

2,885,771

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

31.8.25

31.8.24

£

£

Profit before taxation

852,468

1,047,624

Depreciation charges

103,146

91,838

Loss/(profit) on disposal of fixed assets

47,634

(67,286

)

Finance costs

3,720

322

1,006,968

1,072,498

Increase in stocks

(66,403

)

(415,696

)

Decrease/(increase) in trade and other debtors

147,179

(664,012

)

(Decrease)/increase in trade and other creditors

(293,357

)

595,029

Cash generated from operations

794,387

587,819

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 August 2025

31.8.25

1.9.24

£

£

Cash and cash equivalents

3,655,493

2,885,771

Year ended 31 August 2024

31.8.24

1.9.23

£

£

Cash and cash equivalents

2,885,771

2,535,958

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.9.24

Cash flow

At 31.8.25

£

£

£

Net cash

Cash at bank and in hand

2,885,771

769,722

3,655,493

2,885,771

769,722

3,655,493

Total

2,885,771

769,722

3,655,493

1.	STATUTORY INFORMATION

SPL J Holdings Limited 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.

The presentation currency of the financial statements is the Pound Sterling (£), rounded to the nearest Pound.

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.

Basis of consolidation

The consolidated financial statements of the group include the financial statements of the company and its direct and indirect subsidiary undertakings made up to 31 August 2025. The results of subsidiaries acquired are included in the consolidated profit and loss account from the date control passes. Intra group sales and profits are eliminated fully on consolidation.

Critical accounting judgements and key sources of estimation uncertainty

The directors consider that the critical accounting policies where judgements and estimations have been applied relate to tangible asset lives, stock and amounts due from group entities and trade debtors. In respect of the life of tangible fixed assets, judgements are made on the useful economic life and residual values. The directors have concluded that the asset values and residual values are appropriate.

Stock provision has been calculated on the basis of the age of the stock and likelihood of sale and at what price after the period end. The director is satisfied that stock is valued on an appropriate basis.

The remaining balance of amounts due from group companies and trade debtors are considered recoverable. This is based on profit projections and expectations of growth of those companies.

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 from the sales of good is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on dispatch of the goods.

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 and licences are being amortised evenly over their estimated useful life of ten years.

Computer software is being amortised evenly over its estimated useful life of three years.

Tangible fixed assets

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using straight-line method

Short leasehold - over the term of the lease

Fixtures and fittings - 25% straight line

Office equipment - 25% straight line

The assets' residual values, useful lives and depreciation methods are reviewed and adjusted prospectively if appropriate, or if there is an indication of significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Comprehensive Income.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the profit or loss account.

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.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

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.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet 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.

On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.

Financial instruments

The company has elected to apply the provisions of section 11 'basic financial instruments' and section 12 'other financial instruments issues' of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to contractual provisions of the instruments.

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 instruments, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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

Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Amounts 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.

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 borrowings in current liabilities.

Fixed asset investments

Investments in subsidiaries are carried at cost less impairment.

Going concern

The director has considered the company's performance as well as forecasts and projections for the next 12 months from the date of this report and has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to prepare its financial statements on a going concern basis.