REGISTERED NUMBER: 14110235 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

For The Year Ended

31 October 2025

for

SMRS GROUP LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Statement of Directors' Responsibilities

6

Report of the Independent Auditors

7

Consolidated Profit and Loss Account

11

Consolidated Other Comprehensive Income

12

Consolidated Balance Sheet

13

Company Balance Sheet

14

Consolidated Statement of Changes in Equity

15

Company Statement of Changes in Equity

16

Consolidated Cash Flow Statement

17

Notes to the Consolidated Cash Flow Statement

18

Notes to the Consolidated Financial Statements

19

DIRECTORS:

Mr T C Windsor

Mr R N Lewis

Ms S Sturgess

Mr E Layt

Miss K Cope

Mr D Beynon

Mr R Badley

SECRETARY:

REGISTERED OFFICE:

2 Express Networks

3 George Leigh Street

Manchester

Greater Manchester

M4 6BD

REGISTERED NUMBER:

14110235 (England and Wales)

SENIOR STATUTORY AUDITOR:

Steven John Collings FCCA

AUDITORS:

Leavitt Walmsley Associates Limited

Chartered Certified Accountants and

Statutory Auditors

8 Eastway

Sale

Cheshire

M33 4DX

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

REVIEW OF BUSINESS

SMRS Group Ltd was established in 2022 to act as a holding company for the shares of SMRS Limited. SMRS Group Ltd is, therefore, a non-trading company.

Development and performance of the group during the year

Purpose driven and mission focussed, the group has changed for the better.

2024/25 saw continued global growth across our subsidiary's integrated work systems of Culture, Brand and Communications, as well as recognition for our wider contribution with re-accreditation and substantial score increases through BCorp.

The subsidiary, SMRS Ltd, delivered strong 2024/25 performance through profit growth and increased global activity, driven by action focussed strategies and operational optimisation; working with more clients globally, across a wider range of integrated products and services.

Having always been insight driven, 2024/25 saw the continued development, publication and management of sector knowledge capital and thought leadership - delivered through a broader range of events and owned networks.

A strategic project to accelerate AI within operations, products and services also delivered enhanced outputs, internal capability and client benefit.

Throughout 2024/25, the group continued to run a comprehensive and purposeful internal culture programme; driving deeper understanding, development and improvement to our organisational culture.

Key performance indicators

The directors use a number of key performance indicators (KPIs) to monitor the performance of the group and include:

2025

2024

£m

+ / - %

£m

Turnover v previous year

25.0

+3.1%

24.2

Total gross profit v previous year

8.5

-5.1%

8.9

Operating profit v previous year

1.1

+28.7%

0.856

2024/25 benefitted from the deployment of a robust Enterprise Value framework to measure organisational health, showing positive KPIs across all key measures.

While the group experienced slower activity in some markets due to the economic climate, our diversified product offering minimised overall impact. We also ran a programme to manage costs and improve efficiency, driving growth to the bottom line.

Going into 2025/26, the directors will hold responsibility for the commercial performance and Enterprise Value framework, as well as specific KPIs aligned to their strategic areas of responsibility.

PRINCIPAL RISKS AND UNCERTAINTIES

The economy

Whilst some clients continue to operate under financial pressure, and some clients and industries are facing limited growth, we continually adapt the way we work and who we work with to ensure we protect our staff, our position and our clients.

Through the diversification of our work systems, and broader distribution of geographical clients, we reduce the risk of being overly dependent upon one revenue stream or market.

Regular analysis of all areas of our business are conducted to ensure we continue to operate in a way that protects our business.

Financial risk management

We continually review all financial management processes each year to identify areas for improvement. We continue to improve our credit control systems and processes, supporting them with appropriate resources. We have continued to invest resource and training in our financial reporting and forecasting processes to ensure early warning of changes to planned business performance are identified and acted upon. We do not foresee any significant risk going forward.

Price risk

Our revenue streams are now heavily driven by our fees for our creative, strategic, insight, consultancy and other added value services. We continually assess our time, efficiency and pricing strategies to ensure that we are offering clients exceptional value for our services and that our pricing is in line with our cost base.

Credit risk

We closely monitor all debt and ensure that all applicable work carried out is covered by credit insurance. This credit risk is discussed at all management meetings with action taken should it be required.

Liquidity risk

We closely review business forecasts on an ongoing basis to ensure we minimise liquidity and cash flow risks.

ON BEHALF OF THE BOARD:

Mr T C Windsor - Director

22 June 2026

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

DIVIDENDS

Interim dividends per share were paid as follows:

£400,000

- 6 November 2024

£400,000

- 13 January 2025

£100,000

- 22 July 2025

£900,000

The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 October 2025 will be £ 900,000 .

RESEARCH AND DEVELOPMENT

2024/25 saw increased investment in product development, operational advancement and enterprise technology, while continuing to build and run sector specific data and insight tools. This year our products are services were recognised for their uniqueness through trademark recognition, further cementing our Intellectual Property value.

FUTURE DEVELOPMENTS

Future developments and position of the group at the year end

As the group continues its growth journey, the Board will continue to own their respective strategic areas and hold accountability for the development and delivery of their strategies.

We are clear about the high demand for what we do and we are focussed on delivering growth through market expansion and cross-selling.

DIRECTORS

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

Mr T C Windsor

Mr R N Lewis

Ms S Sturgess

Mr E Layt

Miss K Cope

Mr D Beynon

Mr R Badley

FINANCIAL INSTRUMENTS

The group enters into financial instruments in the ordinary course of business as follows:

Financial assets measured at amortised cost

- Investments in unlisted entities

- Trade and sundry debtors

- Amounts due from related parties

- Cash and bank balances

Financial liabilities measured at amortised cost

- Trade and sundry creditors

- Accrued expenses

GOING CONCERN

Despite the impact the economic circumstances had on our performance, we continue to see demand for our services across the sectors in which we operate.

Through the adaptation and bolstering of our offering, and by entering more geographical markets, we enter the next year in a position to return to the strong business performance that we have seen over recent years.

By analysing our client base, future revenue projections and new business pipeline we are confident that we will drive strong business performance in the coming year and have no hesitation in concluding that the group is a going concern.

DISCLOSURE IN THE STRATEGIC REPORT

In accordance with s414c(11), Sch 7, Companies Act 2006, the group has chosen to set out in the group's strategic report information required by The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008. It has done so in respect of:

(a) Financial risk management objectives and policies

(b) Information on exposure to the economy, financial risk management, price risk, credit risk and liquidity risk

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, Leavitt Walmsley Associates Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr T C Windsor - Director

22 June 2026

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;

-	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.

Opinion

We have audited the financial statements of SMRS Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 October 2025 which comprise the Consolidated Profit and Loss Account, 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 October 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, the Report of the Directors and the Statement of Directors' Responsibilities, 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 six, 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:

We obtained an understanding of the legal and regulatory framework applicable to the group together with the industry in which it operates. We considered the risk of acts by the group which were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one from error, as fraud may involve deliberate concealment by (for example) forgery or intentional misrepresentations, or through collusion.

We focussed on laws and regulations which could give rise to a risk of material misstatement in the financial statements including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation, enquiries with management and reviews of correspondence, in particular correspondence from legal advisers. There are inherent limitations in the audit procedures described above and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud.

As in all our audits, we addressed the risk of management override of internal controls, including testing journal entries and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the 's group's internal control.

- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

- Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Report of the Auditors to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Report of the Auditors. However, future events or conditions may cause the group to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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.

Steven John Collings FCCA (Senior Statutory Auditor)

for and on behalf of Leavitt Walmsley Associates Limited

Chartered Certified Accountants and

Statutory Auditors

8 Eastway

Sale

Cheshire

M33 4DX

22 June 2026

TURNOVER

3

25,017,844

24,258,957

Cost of sales

16,548,514

15,343,062

GROSS PROFIT

8,469,330

8,915,895

Administrative expenses

7,367,755

8,059,834

OPERATING PROFIT

5

1,101,575

856,061

Interest receivable and similar income

147,505

187,381

PROFIT BEFORE TAXATION

1,249,080

1,043,442

Tax on profit

7

173,133

(76,988

)

PROFIT FOR THE FINANCIAL YEAR

1,075,947

1,120,430

Profit attributable to:

Owners of the parent

1,075,947

1,120,430

PROFIT FOR THE YEAR

1,075,947

1,120,430

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,075,947

1,120,430

Total comprehensive income attributable to:

Owners of the parent

1,075,947

1,120,430

FIXED ASSETS

Tangible assets

10

1,150,502

1,249,554

Investments

11

27,998

27,998

1,178,500

1,277,552

CURRENT ASSETS

Stocks

12

13,287

85,636

Debtors

13

5,454,141

5,351,246

Cash at bank

5,950,543

5,274,600

11,417,971

10,711,482

CREDITORS

Amounts falling due within one year

14

10,879,948

10,434,084

NET CURRENT ASSETS

538,023

277,398

TOTAL ASSETS LESS CURRENT LIABILITIES

1,716,523

1,554,950

PROVISIONS FOR LIABILITIES

16

29,142

43,516

NET ASSETS

1,687,381

1,511,434

CAPITAL AND RESERVES

Called up share capital

17

15,100

15,100

Merger reserve

18

(1,485,000

)

(1,485,000

)

Retained earnings

18

3,157,281

2,981,334

SHAREHOLDERS' FUNDS

1,687,381

1,511,434

The financial statements were approved by the Board of Directors and authorised for issue on 22 June 2026 and were signed on its behalf by:

Mr T C Windsor - Director

FIXED ASSETS

Tangible assets

10

-

-

Investments

11

1,532,410

1,532,410

1,532,410

1,532,410

CURRENT ASSETS

Debtors

13

100

100

NET CURRENT ASSETS

100

100

TOTAL ASSETS LESS CURRENT LIABILITIES

1,532,510

1,532,510

CAPITAL AND RESERVES

Called up share capital

17

15,100

15,100

Merger reserve

18

1,517,410

1,517,410

SHAREHOLDERS' FUNDS

1,532,510

1,532,510

Company's profit for the financial year

900,000

1,300,000

The financial statements were approved by the Board of Directors and authorised for issue on 22 June 2026 and were signed on its behalf by:

Mr T C Windsor - Director

Called up

share

Retained

Merger

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 November 2023

15,100

3,160,904

(1,485,000

)

1,691,004

Changes in equity

Dividends

-

(1,300,000

)

-

(1,300,000

)

Total comprehensive income

-

1,120,430

-

1,120,430

Balance at 31 October 2024

15,100

2,981,334

(1,485,000

)

1,511,434

Changes in equity

Dividends

-

(900,000

)

-

(900,000

)

Total comprehensive income

-

1,075,947

-

1,075,947

Balance at 31 October 2025

15,100

3,157,281

(1,485,000

)

1,687,381

Called up

share

Retained

Merger

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 November 2023

15,100

-

1,517,410

1,532,510

Changes in equity

Dividends

-

(1,300,000

)

-

(1,300,000

)

Total comprehensive income

-

1,300,000

-

1,300,000

Balance at 31 October 2024

15,100

-

1,517,410

1,532,510

Changes in equity

Dividends

-

(900,000

)

-

(900,000

)

Total comprehensive income

-

900,000

-

900,000

Balance at 31 October 2025

15,100

-

1,517,410

1,532,510

Cash flows from operating activities

Cash generated from operations

1

1,580,455

131,132

Tax paid

(133,576

)

(87,345

)

Net cash from operating activities

1,446,879

43,787

Cash flows from investing activities

Purchase of tangible fixed assets

(18,441

)

(13,640

)

Purchase of fixed asset investments

-

(27,998

)

Interest received

147,505

187,381

Net cash from investing activities

129,064

145,743

Cash flows from financing activities

Equity dividends paid

(900,000

)

(1,300,000

)

Net cash from financing activities

(900,000

)

(1,300,000

)

Increase/(decrease) in cash and cash equivalents

675,943

(1,110,470

)

Cash and cash equivalents at beginning of year

2

5,274,600

6,385,070

Cash and cash equivalents at end of year

2

5,950,543

5,274,600

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

31.10.25

31.10.24

£

£

Profit before taxation

1,249,080

1,043,442

Depreciation charges

117,493

161,012

Finance income

(147,505

)

(187,381

)

1,219,068

1,017,073

Decrease/(increase) in stocks

72,349

(30,107

)

Increase in trade and other debtors

(102,895

)

(209,180

)

Increase/(decrease) in trade and other creditors

391,933

(646,654

)

Cash generated from operations

1,580,455

131,132

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 October 2025

31.10.25

1.11.24

£

£

Cash and cash equivalents

5,950,543

5,274,600

Year ended 31 October 2024

31.10.24

1.11.23

£

£

Cash and cash equivalents

5,274,600

6,385,070

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.11.24

Cash flow

At 31.10.25

£

£

£

Net cash

Cash at bank

5,274,600

675,943

5,950,543

5,274,600

675,943

5,950,543

Total

5,274,600

675,943

5,950,543

1.	STATUTORY INFORMATION

SMRS Group 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 (£).

2.	ACCOUNTING POLICIES

Basis of preparing the consolidated financial statements

These financial statements have been prepared in accordance with the provisions of FRS 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.

The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements have been rounded to the nearest £.

Going concern

At the time of approving these financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus, the directors continue to adopt the going concern basis of accounting in preparing these consolidated financial statements.

Basis of consolidation

The consolidated financial statements consist of the financial statements of the parent company, SMRS Group Ltd together with all entities controlled by the parent company (its subsidiaries).

Group reconstructions

Group reconstructions are accounted for using the merger method of accounting. Under the merger method of accounting, the carrying amounts of assets and liabilities of the parties to the combination are brought into the consolidated financial statements at book value (with appropriate adjustments, where necessary, to achieve uniformity of accounting policies). The results and cash flows of all the combining entities are brought into the financial statements of the group from the beginning of the financial year in which the combination occurred.

All financial statements are made up to 31 October each year. All intra-group transactions, balances and unrealised gains and losses on transactions between group members are eliminated on consolidation.

Business combinations

For business combinations which do not meet the criteria to apply merger accounting, the purchase method of accounting is used.

Financial Reporting Standard 102 - reduced disclosure exemptions

The group has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirement of paragraph 33.7.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the year end date and amounts reported for revenue and expenses during the year. However, the nature of the estimation is such that actual outcomes could differ from those estimates. The following judgements have the most significant effect on amounts recognised in the consolidated financial statements:

Judgements in applying accounting policies:

Revenue recognition

Judgement is required in selecting the appropriate timing and amount of revenue recognised. Revenue is only recognised when it can be reliably estimated using customer-specific information and, where there is a performance-related element, to the extent to which performance criteria have been met.

Trade debtors

The likelihood of collection of trade debtors also requires judgement to be applied. The group makes an assessment at each balance sheet date as to whether a provision for specific bad debts is required through a detailed review of individual customer balances.

Key sources of estimation uncertainty:

The annual depreciation charge for property, plant and equipment is sensitive to changes in the estimated useful economic lives and estimated residual values of the assets. The useful economic lives and residual values of the assets are re-assessed annually and are amended, where necessary, to reflect current estimates. Changes in residual values and economic lives are accounted for as a change in accounting estimate under FRS 102, Section 10 'Accounting Policies, Estimates and Errors'.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover represents the gross amount of billings for the group's provision of services in which media income is earned, together with fee income receivable. Media income is recognised either at the time the related advertisement appears, or on an ongoing basis as the related production progresses. Fees are recognised as income when they are earned in accordance with the agreement with clients.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Long leasehold

-

2% on cost

Improvements to property

-

20% on cost and 10% on cost

Fixtures and fittings

-

33% on cost

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs which are directly attributable in bringing the asset to its location and condition so that it is capable of operating in the manner intended by management.

Residual values used in the calculation of depreciable amount are the expected amounts which would currently be obtained from disposal of assets, after deducting the estimated costs of disposal, if the assets were already of the age and in the condition expected at the end of their useful lives.

Profits and losses on the disposal of fixed assets are included in the calculation of profit for the period.

The directors assess the company's tangible assets for evidence of impairment at each reporting date. Where there are indicators of impairment, the directors calculate recoverable amount of the asset(s) and compare this with the carrying amount. If recoverable amount is lower than carrying amount, the asset is written down to recoverable amount by way of an impairment loss which is recognised in profit or loss for the period. Impairment losses are reversed when there is evidence that the reasons giving rise to the original impairment have ceased to apply. Impairment losses are reversed through profit and loss but only to the extent that the reversal does not increase the carrying amount of the asset to the amount which would have been stated, net of depreciation, had no impairment loss been recognised.