REGISTERED NUMBER: 15030110 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025

FOR

R&A RETAIL HUB CO LTD

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

7

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

A L C Florea

R Florea

REGISTERED OFFICE:

8 Dawson Road

Bletchley

Buckinghamshire

MK1 1LH

REGISTERED NUMBER:

15030110 (England and Wales)

AUDITORS:

MDG Business Associates Audit Limited

Room 73

Wrest House

Silsoe

Bedfordshire

MK45 4HR

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

COMPANY DESCRIPTION AND FUTURE OUTLOOK

The R&A Retail Hub Co Ltd group is an e-commerce group of companies focusing primarily on sales via the Amazon Marketplace across the UK, Europe North America, Middle East and Australia. However, the group also has a strong presence on eBay, Debenhams, Shein, Tik-Tok and their own website www.gettrend.com.

The growth since the group's incorporation in July 2015 has been incredibly strong. The work to date in selecting brand licenses and then developing products has allowed the company to continue this growth, along with developing their own brands, such as City Comfort, Deco Express and Kreative Kraft. As the growth continues, more development has been undertaken in multiple product lines such as children's toys, kitchen utensils and wellness products.

The outlook of the group looks to be very strong with the growth of sales into new territories. The company continues to look at new routes to market through new online platforms.

The group continues to upskill its team and improving its financial reporting using analytical tools.

In the foreseeable future, there will be various challenges that the group will encounter. This is primarily because of the fall in demand for retail products globally, high inflation and non-current inventory will put pressure on revenue and margins.

REVIEW OF BUSINESS

The group had a very successful trading period considering the fall in global demand for retail, and the continued increases in inflation, resulting in the reduction in both gross profit margins and net profit, within F&F Stores Ltd. The group enjoys positive relationships with both customers and suppliers alike and is looking forward to further growth in the forthcoming year.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors continually assess the level of risk that is likely to occur in the running of the group, and for any major activity or business change which occurs, a detailed risk assessment is carried out.

The warehouses are now very well run with preventative maintenance carried out in a planned and controlled manner. The principal risk of the group is that stock levels are maintained at reasonable levels at times of high demand. We add value to our clients due to the high level of service we offer, in all our markets UK, EU, US and Middle East, and the traceability of products. F&F are well placed to continue increasing the efficiency of their day-to-day operations and continue to provide high levels of customer service to clients.

SECTION 172(1) STATEMENT

The directors of R&A Retail Hub Co Ltd confirm that, during the financial period ended 31 December 2025, they have acted in a way that they consider, in good faith, to promote the success of the group for the benefit of its members as a whole, in accordance with their duties under section 172 of the Companies Act 2006. In doing so, the directors have had regard to the matters set out in section 172(1)(a) to (f).

In particular:

(a) The likely consequences of any decision in the long term

The board regularly considers the long-term impact of its decisions, especially with respect to our digital infrastructure, sustainability of supply chains, and customer trust. Investments in logistics, technology, and data security are aimed at ensuring continued growth and resilience.

(b) The interests of the group's employees

We are committed to creating a positive and supportive environment for our employees.

(c) The need to foster business relationships with suppliers, customers and others

Strong relationships with suppliers and customers are critical to our business. We work closely with suppliers to ensure ethical sourcing and timely delivery. We also maintain clear communication with our customers and regularly gather feedback to improve user experience and satisfaction.

(d) The impact of the group's operations on the community and the environment

We recognise our responsibility to minimise our environmental impact. In the last year, we expanded our use of recyclable packaging and optimised our delivery routes to reduce emissions.

(e) The desirability of maintaining a reputation for high standards of business conduct

Our business is built on trust. We maintain clear policies on data protection, consumer rights, and ethical business practices. Staff undergo regular training on these policies, and we hold ourselves to high standards of transparency and fairness.

(f) The need to act fairly as between members of the company

The board considers all shareholders equally in its decision-making, ensuring transparent communication and providing fair access to information through regular reports and meetings. The directors are mindful that effective engagement with stakeholders is key to fulfilling their duties under section 172 and promoting the long-term success of the group.

NON FINANCIAL KEY PERFORMANCE INDICATORS

In a group this size the directors consider there are collectively other numerous non-financial performance indicators but none individually are key.

FINANCIAL RISK MANAGEMENT

The group had no hedging arrangements at 31 December 2025. The group has exposure to foreign exchange rate movements but constantly reviews this position to ensure that this is managed as much as possible on a timely basis through the trading year. However, with the growth of US business the group now has a natural hedge in USD as most the creditors are denominated in USD.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors are responsible for determining the level of risk acceptable to the group. This is subject to regular review. The group seeks to mitigate its risks through the application of strict limits, controls and a monitoring process at operational level.

CREDIT RISK

Credit risk is the risk that counterparties will not be able to meet their obligations as they fall due. There are regular credit reviews of counterparty limits by the directors.

OPERATIONAL RISK

Operational risk is caused by failures in business process, systems or physical infrastructure that support them that have the potential to result in financial loss of reputational damage. This includes errors, omissions, systems failure, lack of resources, theft of physical assets and deliberate acts such as fraud.

There is a risk that the key IT systems could fail causing a loss of business and reputational damage. This is mitigated by a local and constantly available IT service for support and an efficient back up service and business continuity plan.

The directors maintain strong internal controls to prevent the occurrence of fraud and other potential system failures as noted above.

BUSINESS RISK

There is a risk that the economic demand for the groups services will diminish, resulting in less income. These risks are mitigated by the group having a relatively low-cost base and a diversified customer base across the UK, EU and US

LIQUIDITY RISK

The group ensures that liquidity is maintained by monitoring cash balances daily to ensure it retains flexibility in the management of cash flows.

ON BEHALF OF THE BOARD:

A L C Florea - Director

15 September 2026

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of a holding company, whilst its trading subsidiaries principally operate as online goods retailers.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2025 will be £550,000.

DIRECTORS

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

A L C Florea

R Florea

STREAMLINED ENERGY AND CARBON REPORTING

The group is committed to reducing its Green House Gasses (GHG) emissions and are working towards achieving the environmental targets set by the Streamlined Energy Carbon Reporting (SECR) framework.

Our approach to reporting is based on the GHG Protocol Corporate Accounting and Reporting Standard. In line with the guidance on SECR we have included the energy and emissions for the buildings we own and operate and also those where we lease facilities and are responsible for energy consumption.

We are virtually net zero on our main UK warehouse and our warehouse in Romania. For our other UK warehouses, the annual usage was 27,057 KWH of Grid Supplied Electricity (scope 2) and 0 KWH of Gaseous and other fuels (scope 1).

Scope 1 and 2 consumption, CO2 emission data and Emission Factor Database used are considered with the 2020 UK Government environmental reporting guidance.

The company continues to implement energy efficiency measures including limiting the number of vehicle journeys by making use of technologies and the promotion of electric non-commercial vehicles for our employees.

The company will continue to identify means to improve energy efficiency and monitor our impact on the environment and the areas in which we work.

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). 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;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	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.

ON BEHALF OF THE BOARD:

A L C Florea - Director

15 September 2026

Opinion

We have audited the financial statements of R&A Retail Hub Co Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 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 December 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 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We have assessed that there is a low risk of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations central to the trading activities of the company. The assessment has been based upon a substantive testing approach to key identified risk areas, principally being revenue recognition and the threat of override controls by local management. No suspected fraud, breach or other non-compliance with underlying laws and regulations has been identified during sample testing undertaken during the audit process and no such issues have been raised by the board of directors or local management prior to making this assessment. A full review of available board minutes, and other supporting third party documentation where available, has been undertaken and no items have come to our attention which require to be reported to the user of the financial statements. The company has strong internal controls and our audit has indicated no instances of managerial override of controls, including through testing of journal entries and other adjustments for appropriateness. No transactions have been identified as being made outside the normal course of business from work we have performed in each key risk area of the audit. The directors and other key local officers are informed management and as such they make regular review to ensure the company is compliant in all instances.

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.

Michael Grange BA (Hons) (Senior Statutory Auditor)

for and on behalf of MDG Business Associates Audit Limited

Room 73

Wrest House

Silsoe

Bedfordshire

MK45 4HR

15 September 2026

TURNOVER

121,059,165

100,700,289

Cost of sales

(101,189,410

)

(86,366,120

)

GROSS PROFIT

19,869,755

14,334,169

Administrative expenses

(9,233,530

)

(10,088,344

)

OPERATING PROFIT

5

10,636,225

4,245,825

Release of negative goodwill

6

9,540,817

-

20,177,042

4,245,825

Interest receivable and similar income

627

188,106

20,177,669

4,433,931

Interest payable and similar expenses

7

(649,985

)

(1,962,557

)

PROFIT BEFORE TAXATION

19,527,684

2,471,374

Tax on profit

8

(2,253,187

)

(2,161,524

)

PROFIT FOR THE FINANCIAL YEAR

17,274,497

309,850

Profit attributable to:

Owners of the parent

17,274,497

309,850

PROFIT FOR THE YEAR

17,274,497

309,850

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

17,274,497

309,850

Total comprehensive income attributable to:

Owners of the parent

17,274,497

309,850

FIXED ASSETS

Intangible assets

11

1

(9,540,817

)

Tangible assets

12

5,224,680

5,644,563

Investments

13

-

-

5,224,681

(3,896,254

)

CURRENT ASSETS

Stocks

14

29,713,805

22,010,618

Debtors

15

9,309,917

7,192,463

Cash at bank

7,703,026

3,541,360

46,726,748

32,744,441

CREDITORS

Amounts falling due within one year

16

(27,364,375

)

(23,661,100

)

NET CURRENT ASSETS

19,362,373

9,083,341

TOTAL ASSETS LESS CURRENT LIABILITIES

24,587,054

5,187,087

CREDITORS

Amounts falling due after more than one year

17

(2,625,103

)

-

NET ASSETS

21,961,951

5,187,087

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Retained earnings

21

21,960,951

5,186,087

SHAREHOLDERS' FUNDS

21,961,951

5,187,087

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

A L C Florea - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

15,819,967

15,819,967

15,819,967

15,819,967

CURRENT ASSETS

Debtors

15

1

1

TOTAL ASSETS LESS CURRENT LIABILITIES

15,819,968

15,819,968

CREDITORS

Amounts falling due after more than one year

17

(7,819,967

)

(7,819,967

)

NET ASSETS

8,000,001

8,000,001

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Merger relief reserve

21

7,999,001

7,999,001

SHAREHOLDERS' FUNDS

8,000,001

8,000,001

Company's profit for the financial year

550,000

653,000

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

R Florea - Director

A L C Florea - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 26 July 2023

-

5,529,237

5,529,237

Changes in equity

Issue of share capital

1,000

-

1,000

Dividends

-

(653,000

)

(653,000

)

Total comprehensive income

-

309,850

309,850

Balance at 31 December 2024

1,000

5,186,087

5,187,087

Changes in equity

Dividends

-

(550,000

)

(550,000

)

Total comprehensive income

-

17,274,497

17,274,497

Balance at 31 December 2025

1,000

21,910,584

21,911,584

Called up

Merger

share

Retained

relief

Total

capital

earnings

reserve

equity

£

£

£

£

Changes in equity

Issue of share capital

1,000

-

-

1,000

Dividends

-

(653,000

)

-

(653,000

)

Total comprehensive income

-

653,000

7,999,001

8,652,001

Balance at 31 December 2024

1,000

-

7,999,001

8,000,001

Changes in equity

Dividends

-

(550,000

)

-

(550,000

)

Total comprehensive income

-

550,000

-

550,000

Balance at 31 December 2025

1,000

-

7,999,001

8,000,001

Cash flows from operating activities

Cash generated from operations

1

19,149,505

8,761,526

Interest paid

(649,985

)

(1,962,557

)

Tax paid

(3,923,875

)

735,110

Net cash from operating activities

14,575,645

7,534,079

Cash flows from investing activities

Purchase of intangible fixed assets

-

(95,000

)

Purchase of tangible fixed assets

(3,465,440

)

(1,385,285

)

Sale of intangible fixed assets

(9,540,817

)

-

Sale of tangible fixed assets

3,141,651

-

Acquisition of subsidiary, net of cash

-

(2,048,540

)

Interest received

627

188,106

Net cash from investing activities

(9,863,979

)

(3,340,719

)

Cash flows from financing activities

Share issue

-

1,000

Equity dividends paid

(550,000

)

(653,000

)

Net cash from financing activities

(550,000

)

(652,000

)

Increase in cash and cash equivalents

4,161,666

3,541,360

Cash and cash equivalents at beginning of year

2

3,541,360

-

Cash and cash equivalents at end of year

2

7,703,026

3,541,360

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

Period

26.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Profit before taxation

19,527,684

2,471,374

Depreciation charges

743,683

723,907

Loss on disposal of fixed assets

-

15,326

Finance costs

649,985

1,962,557

Finance income

(627

)

(188,106

)

20,920,725

4,985,058

Increase in stocks

(7,703,187

)

(3,786,567

)

(Increase)/decrease in trade and other debtors

(2,067,096

)

12,650,069

Increase/(decrease) in trade and other creditors

7,999,063

(5,087,034

)

Cash generated from operations

19,149,505

8,761,526

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 December 2025

31.12.25

1.1.25

£

£

Cash and cash equivalents

7,703,026

3,541,360

Period ended 31 December 2024

31.12.24

26.7.23

£

£

Cash and cash equivalents

3,541,360

-

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.25

Cash flow

At 31.12.25

£

£

£

Net cash

Cash at bank

3,541,360

4,161,666

7,703,026

3,541,360

4,161,666

7,703,026

Debt

Debts falling due within 1 year

(649,139

)

(1,612,642

)

(2,261,781

)

Debts falling due after 1 year

-

(2,625,103

)

(2,625,103

)

(649,139

)

(4,237,745

)

(4,886,884

)

Total

2,892,221

(76,079

)

2,816,142

1.	STATUTORY INFORMATION

R&A Retail Hub Co Ltd 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.	STATEMENT OF COMPLIANCE

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.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The company has considerable financial resources and as a consequence, the directors believe that the company is well placed to manage its business risks successfully despite the uncertain economic outlook.

The comparatives relate to the period 26 July 2023 to 31 December 2024.

Merger accounting

The group applies merger accounting to business combinations involving entities under common control in accordance with Section 19 of FRS 102.

Under merger accounting:

- The results and cash flows of the combining entities are brought into the financial statements as if the combination had occurred at the beginning of the earliest accounting period presented.

- The assets and liabilities of the combining entities are recorded at their existing book values, without fair value adjustment.

- No goodwill is recognised.

- Any difference between the consideration paid and the nominal value of shares issued is presented within equity as a merger reserve.

- Comparative amounts are restated to include the results of the combining entities for the entire comparative period.

Merger accounting is only adopted where the shareholders ultimately retain the same rights and interests before and after the combination; and the combination represents a restructuring or reorganisation of entities under common control.

Business combinations

Business combinations are accounted for using the purchase method. The cost of a business combination is measured as the fair value of consideration transferred, including directly attributable acquisition costs. Identifiable assets acquired and liabilities assumed are recognised at their fair values at the acquisition date. Any excess of the cost of acquisition over the fair value of the identifiable net assets acquired is recognised as goodwill.

Goodwill is subsequently measured at cost less accumulated amortisation and impairment losses. Goodwill is amortised over its estimated useful economic life. Where a reliable estimate cannot be made, the life does not exceed ten years.

Contingent consideration is recognised where probable and capable of reliable measurement.

Acquisition-related costs are included in the cost of the combination under FRS 102

Turnover

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

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 five years.

Development costs are being amortised evenly over their estimated useful life of five years.

Computer software was amortised evenly over their estimated useful life of five years.

Negative goodwill arose where the fair value of the identifiable net assets acquired exceeded the cost of acquisition. In accordance with FRS 102 Section 19, negative goodwill was recognised as a separate credit on the balance sheet, within intangible fixed assets. Amounts relating to non monetary assets were credited to profit or loss in the periods in which the related assets are recovered and any excess negative goodwill (i.e., amounts not related to non monetary assets) was credited to profit or loss on a systematic basis over the periods expected to benefit, not exceeding five years unless a longer period can be justified.

Tangible fixed assets

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

Freehold property

-

4% on cost

Long leasehold

-

20% on cost

Improvements to property

-

4% on cost

Fixtures and fittings

-

20% on cost

Motor vehicles

-

20% on cost

Computer equipment

-

20% on cost

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

The company has chosen to account for their financial instruments in accordance with Sections 11 and 12 of FRS 102.

Financial assets

Trade and other receivables are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at present value of the future receipts discounted at a market rate of interest.

The basic financial assets, other than short term receivables, are subsequently carried at amortised cost using the effective interest method.

Short term trade and other receivables with no stated interest rate which are receivable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the income statement in administrative expenses.

Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise cash at bank, in hand and short-term deposits with an original maturity date of three months or less. It also includes cash receivable on debit or credit cards, where the transaction has been authorised but the fund have yet to clear the bank. Such balances are considered highly liquid with minimal risk of default and typically funds are received in less than 3 days.

Financial liabilities

Basic financial liabilities including trade and other payable and interest bearing loans and borrowing, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the liability is measured at the present value of future payments discounted at a market rate of interest.

Basic financial liabilities, other than short term payable, are subsequently carried at amortised cost using the effective interest rate method. The effective interest rate amortisation is included in the interest payable and similar expenses in the income statement.

Short term trade and other payable with no stated interest rate which are payable within one year are recorded at transaction price.