REGISTERED NUMBER: 09902441 (England and Wales)

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2026

FOR

PAINE MANWARING GROUP LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Consolidated Statement of 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 Financial Statements

15

DIRECTORS:

A D Prager

J M Preston

A J Doick

C P Hornsbury

J Seaman

REGISTERED OFFICE:

Unit D Easting Close

Dominion Way

Worthing

West Sussex

BN14 8HQ

REGISTERED NUMBER:

09902441 (England and Wales)

AUDITORS:

Lewis Brownlee (Chichester) Limited

Statutory Auditors

Appledram Barns

Birdham Road

Chichester

West Sussex

PO20 7EQ

The directors present their strategic report of the company and the group for the year ended 31 March 2026.

FAIR REVIEW OF THE BUSINESS

The group reports revenue of £21.2m for the financial year 2025/26, a decrease of £4.5m compared with £25.7m in 2024/25. As anticipated in last year's report, the year reflected the forecast reduction in activity arising from contract delays and project cancellations amid continued economic turbulence affecting the UK construction industry.

Reflecting the continued softening of the wider UK economy, the Directors now forecast revenue of £21/23m for 2026/27 but on a reduced margin, with the anticipated return to growth to build through the 2027/28 financial year.

To date, the group has secured projects totalling £13.6m, of which £11.9m is expected to be delivered in the 2026/27 financial year. This figure excludes repeat service work and a further £17.2m in pipeline tenders currently in final contract negotiations.

During 2025/26 the group continued the roll-out of its contract document management software, streamlining document handling and improving internal efficiency. This has supported service delivery to main contractors and compliance with the latest regulatory requirements. The group is also adopting artificial intelligence tools to complement its existing systems, further improving efficiency and the quality of service delivered to clients.

The Directors remain confident in the group's prospects for 2026/27 and beyond. This outlook aligns with the group's long-term strategic plans and reflects its resilience in navigating one of the most competitive environments the industry has faced.

Once again, the Directors wish to thank the group's employees for another year of hard work and dedication in achieving these levels of activity.

The core activities of the business continue to be working closely with repeat business clients and contractors and providing the highest level of service in maintaining the group's position as a well-respected and reputable mechanical and electrical contractor. The core focus of specialities in the healthcare, education, leisure, and industrial sectors as well as in high end and residential projects continues.

The group also has significant involvement in the domestic market where it continues to provide first-class services, including 24-hour emergency call outs in Sussex, Surrey and Hampshire.

Gross profit margins remain one of the group's key challenges. The gross profit margin moved to 21.8%, compared with 20.4% in the previous year. This improvement reflects continued investment in the workforce, management, management structure, systems, and processes.

Despite these pressures, the Directors are satisfied with a profit before taxation of £1.25m (2024/25: £2.0m). They believe that ongoing investment in people and infrastructure will position the group strongly as industry standards and requirements continue to evolve.

The statement of financial position continues to demonstrate the Directors' prudent reserve plans needed in this industry and further cements the Group's substantial footing with £3.3m (2024/25: £3.1) in total equity, healthy cash at bank and in hand balance of £2.7m (2024/25: £4m).

PRINCIPAL RISKS AND UNCERTAINTIES

The fortunes of the group's heating, plumbing and electrical trade are closely tied to those of the construction industry which is currently reporting difficulties for similar sized companies and is likely to remain fiercely competitive whilst we operate in the current economic climate of high inflation, interest rates and client budget restraints. The current wage inflation will keep margins under pressure for the foreseeable future.

There is also a workforce skill set shortage within the plumbing and electrical trade which is putting continued pressure on direct labour costs and the gross margin achieved, the Directors have maintained the number and continue to invest in apprentices within the group over the last 12 months to help mitigate this impact.

Wider economic uncertainties also pose a risk, particularly regarding demand for new projects and the potential for business failures within the industry. Additionally, increasing regulation and health and safety requirements remain ongoing challenges.

The group actively monitors industry developments through its trade associations, ECA and BESA, ensuring it remains informed and compliant with evolving standards.

With a strong asset base, robust business plan, ongoing staff training, and investment in systems and compliance, the group is well-positioned to mitigate these risks and maintain operational resilience.

ON BEHALF OF THE BOARD:

A D Prager - Director

15 July 2026

The directors present their report with the financial statements of the company and the group for the year ended 31 March 2026.

PRINCIPAL ACTIVITY

The company is the holding company of Paine Manwaring Heating Limited and its trading subsidiary, Paine Manwaring Limited. Paine Manwaring Limited’s principal activity continued to be that of contracting for the installation and maintenance of heating and electrical systems. Paine Manwaring Heating Limited provides assets to its subsidiary undertaking.

DIVIDENDS

Dividends were paid amounting to £744,810 (2025 - £987,900). The directors do not recommend payment of a further dividend.

FUTURE DEVELOPMENTS

The directors' consideration of future events, including the principal risks and uncertainties related to these, are included within the Strategic Report

EVENTS SINCE THE END OF THE YEAR

Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2025 to the date of this report.

A D Prager

J M Preston

A J Doick

C P Hornsbury

J Seaman

FINANCIAL INSTRUMENTS

Treasury operations and financial instruments

The group operates a treasury function which is responsible for managing the liquidity risks associated with the group’s activities.

The group’s principal financial instruments do not include derivative financial instruments. The group has various other financial assets and liabilities such as trade debtors and trade creditors arising directly from its operations.

Liquidity risk

The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the

businesses.

Credit risk

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

THIRD PARTY INDEMNITY PROVISION

There is a third party indemnity provision in place for the benefit of all directors of the group.

DIRECTORS' RESPONSIBILITIES STATEMENT

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.

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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Lewis Brownlee (Chichester) Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

A D Prager - Director

15 July 2026

Opinion

We have audited the financial statements of Paine Manwaring Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2026 which comprise the Consolidated Statement of 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 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 March 2026 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 other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. 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.

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 course of 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 Directors' Responsibilities Statement set out on page five, 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.

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.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

-

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

-

we identified the laws and regulations applicable to the group through discussions with directors and other management, and from our commercial knowledge and experience of the sector;

-

we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group, including legislation such as the Companies Act 2006 and taxation legislation, the Health and Safety at Work Act, and relevant building and electrical associations;

-

we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence, where applicable; and

-

identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the group financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

-

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and

-

considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

-

performed analytical procedures to identify any unusual or unexpected relationships;

-

tested journal entries to identify unusual transactions;

-

assessed whether judgements and assumptions made in determining the accounting estimates set out in the accounting policies were indicative of potential bias; and

-

investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

-

agreeing financial statement disclosures to underlying supporting documentation;

-

reading the minutes of meetings of those charged with governance, where applicable;

-

enquiring of management as to actual and potential litigation and claims; and

-

reviewing correspondence with HMRC, relevant regulators and the company’s legal advisors, where applicable.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

Sam Ede BFP FCA FCCA (Senior Statutory Auditor)

for and on behalf of Lewis Brownlee (Chichester) Limited

Statutory Auditors

Appledram Barns

Birdham Road

Chichester

West Sussex

PO20 7EQ

15 July 2026

TURNOVER

3

21,176,266

25,710,191

Cost of sales

16,566,694

20,466,594

GROSS PROFIT

4,609,572

5,243,597

Administrative expenses

3,438,578

3,300,877

OPERATING PROFIT

5

1,170,994

1,942,720

Interest receivable and similar income

78,042

74,709

1,249,036

2,017,429

Interest payable and similar expenses

6

3,415

4,316

PROFIT BEFORE TAXATION

1,245,621

2,013,113

Tax on profit

7

353,499

546,032

PROFIT FOR THE FINANCIAL YEAR

892,122

1,467,081

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

892,122

1,467,081

Profit attributable to:

Owners of the parent

892,122

1,467,081

Total comprehensive income attributable to:

Owners of the parent

892,122

1,467,081

FIXED ASSETS

Intangible assets

10

-

166,262

Tangible assets

11

456,545

417,358

Investments

12

-

-

456,545

583,620

CURRENT ASSETS

Stocks

13

26,683

26,823

Debtors

14

4,075,372

3,371,763

Cash at bank

2,679,000

3,978,492

6,781,055

7,377,078

CREDITORS

Amounts falling due within one year

15

3,840,850

4,695,012

NET CURRENT ASSETS

2,940,205

2,682,066

TOTAL ASSETS LESS CURRENT LIABILITIES

3,396,750

3,265,686

CREDITORS

Amounts falling due after more than one year

16

(9,431

)

(37,291

)

PROVISIONS FOR LIABILITIES

19

(100,826

)

(89,214

)

NET ASSETS

3,286,493

3,139,181

CAPITAL AND RESERVES

Called up share capital

20

166,500

185,000

Capital redemption reserve

21

133,500

115,000

Other reserves

21

-

(74,493

)

Retained earnings

21

2,986,493

2,913,674

SHAREHOLDERS' FUNDS

3,286,493

3,139,181

The financial statements were approved by the Board of Directors and authorised for issue on 15 July 2026 and were signed on its behalf by:

J M Preston - Director

A D Prager - Director

FIXED ASSETS

Intangible assets

10

-

-

Tangible assets

11

-

-

Investments

12

3,015,000

3,015,000

3,015,000

3,015,000

CURRENT ASSETS

Cash at bank

29,695

25,903

CREDITORS

Amounts falling due within one year

15

2,729,649

2,726,899

NET CURRENT LIABILITIES

(2,699,954

)

(2,700,996

)

TOTAL ASSETS LESS CURRENT LIABILITIES

315,046

314,004

CAPITAL AND RESERVES

Called up share capital

20

166,500

185,000

Capital redemption reserve

21

133,500

115,000

Other reserves

21

-

(74,493

)

Retained earnings

21

15,046

88,497

SHAREHOLDERS' FUNDS

315,046

314,004

Company's profit for the financial year

745,852

990,862

The financial statements were approved by the Board of Directors and authorised for issue on 15 July 2026 and were signed on its behalf by:

J M Preston - Director

A D Prager - Director

Called up

Capital

share

Retained

redemption

Other

Total

capital

earnings

reserve

reserves

equity

£

£

£

£

£

Balance at 1 April 2024

185,000

2,434,493

115,000

(74,493

)

2,660,000

Changes in equity

Total comprehensive income

-

1,467,081

-

-

1,467,081

Dividends

-

(987,900

)

-

-

(987,900

)

Balance at 31 March 2025

185,000

2,913,674

115,000

(74,493

)

3,139,181

Changes in equity

Total comprehensive income

-

892,122

-

-

892,122

Dividends

-

(744,810

)

-

-

(744,810

)

Cancellation of shares

(18,500

)

(74,493

)

18,500

74,493

-

Balance at 31 March 2026

166,500

2,986,493

133,500

-

3,286,493

Called up

Capital

share

Retained

redemption

Other

Total

capital

earnings

reserve

reserves

equity

£

£

£

£

£

Balance at 1 April 2024

185,000

85,535

115,000

(74,493

)

311,042

Changes in equity

Total comprehensive income

-

990,862

-

-

990,862

Dividends

-

(987,900

)

-

-

(987,900

)

Balance at 31 March 2025

185,000

88,497

115,000

(74,493

)

314,004

Changes in equity

Total comprehensive income

-

745,852

-

-

745,852

Dividends

-

(744,810

)

-

-

(744,810

)

Cancellation of shares

(18,500

)

(74,493

)

18,500

74,493

-

Balance at 31 March 2026

166,500

15,046

133,500

-

315,046

Cash flows from operating activities

Cash generated from operations

24

58,648

2,744,711

Interest element of hire purchase payments paid

(3,415

)

(4,316

)

Tax paid

(475,693

)

(437,110

)

Net cash from operating activities

(420,460

)

2,303,285

Cash flows from investing activities

Purchase of tangible fixed assets

(189,866

)

(164,271

)

Sale of tangible fixed assets

13,118

25,839

Interest received

78,042

74,709

Net cash from investing activities

(98,706

)

(63,723

)

Cash flows from financing activities

Capital repayments on finance leases

(35,516

)

(46,174

)

Equity dividends paid

(744,810

)

(987,900

)

Net cash from financing activities

(780,326

)

(1,034,074

)

(Decrease)/increase in cash and cash equivalents

(1,299,492

)

1,205,488

Cash and cash equivalents at beginning of year

25

3,978,492

2,773,004

Cash and cash equivalents at end of year

25

2,679,000

3,978,492

1.	STATUTORY INFORMATION

Paine Manwaring 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.

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.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £1.

Going concern

The financial statements have been prepared on a going concern basis. In making their assessment, the directors have considered relevant information including the annual budget, forecast future cash flows, the monthly orderbook projections, and the impact of subsequent events.

The directors have performed a robust analysis of the principal risks to the secured orderbook and future cash flows, including cost inflation and the timing of customer payments. Whilst it is difficult to predict all such impacts with certainty, the group has adequate resources to continue in operational existence for the foreseeable future.

Based on these assessments, and having regard to the resources available to the entity, the directors have concluded that there is no material uncertainty and that they can continue to adopt the going concern basis in preparing the annual report and accounts.

Basis of consolidation

The group consolidated financial statements include the financial statements of the company and all of its subsidiary undertakings. All financial statements are made up to 31 March 2026.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

The cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities acquired is recognised as goodwill

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.

Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade and other discounts.

Sale of goods

Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on dispatch or collection of the goods, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services and construction contracts

Turnover from rendering of services and construction contracts is recognised when the outcome of a service or contract can be measured reliably, the entity will recognise both income and costs by reference to the percentage of completion of the service or contract.

The methods used to determine the stage of completion are:

- the proportion that costs incurred for work performed to date bear to the estimated total costs; and

- surveys of work performed.

If the outcome cannot be reliably measured, all costs are expensed and revenue is only recognised to the

extent that it is probable that costs are recoverable.

When it is probable that a loss will occur on a service or contract, this is recognised in full immediately as an onerous contract provision.

Goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is considered to be 10 years.

Intangible assets

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Software 20% per annum straight line

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Short leasehold

-

Over the expected life of the lease

Plant and machinery

-

10-20% on cost

Fixtures and fittings

-

10-20% on cost

Motor vehicles

-

20-25% on cost

Computer equipment

-

25% on cost

Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Investments

Fixed asset investments are stated at cost less provision for diminution in value.

Impairment of non-current assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss.

Stocks

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

Financial instruments

Financial instruments are classified by the director as basic or advanced following the conditions in Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' Section 11. Basic financial instruments are recognised at amortised cost using the effective interest method unless the effect of discounting would be immaterial, in which case they are stated at cost. The group has no advanced financial instruments.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, 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

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

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.

Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the group's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Construction contracts

In respect to construction contracts, the management undertake regular progress reviews. Profits (or losses) are recognised within the statement of comprehensive income as part of a contract's revenue and cost where management consider that the outcome of a construction contract can be estimated reliably. Reliable estimates are determined with reference to each contract’s stage of completion, future costs to complete and collectability of billings.