Basis of preparation: The financial statements are presented in pounds sterling and rounded to the nearest pound. They are prepared on the historical cost basis, except for investment property which is stated under the fair value model in accordance with FRS 102 Section 16. Going concern: Notwithstanding net liabilities at the period end, the financial statements have been prepared on the going concern basis. The director has confirmed his intention to continue to provide financial support to the company by way of director's loan for at least 12 months from the date of approval of these financial statements. Financial instruments: The company has elected to apply Sections 11 and 12 of FRS 102 to its financial instruments. Basic financial liabilities are recognised initially at the transaction price less directly attributable transaction costs, and are subsequently measured at amortised cost. The bank loan has been presented net of unamortised loan issue costs. Issue costs are amortised on a straight-line basis over the 24-month fixed-rate period of the loan, which approximates the effective interest method given the short duration. Trade and other creditors: Trade and other creditors are recognised at their nominal value, which is not materially different from amortised cost given the short maturity profile. Taxation: Current tax is calculated on the basis of tax rates and laws enacted or substantively enacted at the reporting date. As the company has incurred a loss in the period, no current tax charge arises. The loss is available to be carried forward against future profits of the property letting business under section 62 of the Corporation Tax Act 2010. No deferred tax asset has been recognised in respect of the loss carried forward as the recovery of the asset is not considered sufficiently certain at this stage of the company's operations.