HORNE ENGINEERING LIMITED


Directors	HORNE, Angus William Dewar
	HORNE, John Alexander


Registered Address	Lancefield Works
	Rankine Street
	Johnstone
	PA5 8BD


Registered Number	SC016062 (Scotland)

Notes to the Financial Statements
for the year ended 31 December 2025

1.	Accounting policies

	Statutory information
	The company is a private company limited by shares and registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

	Basis of preparation
	The financial statements have been prepared under the historical cost convention on a going concern basis unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

	Functional and presentation currency
	The financial statements are presented in sterling and this is the functional currency of the company.

	Turnover policy
	Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods. Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer.

	Defined contribution pension plan
	The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further obligation. Contributions to defined contribution plans are expensed in the period to which they relate. Amounts not paid are shown in other creditors in the Statement of Financial Position. The assets of the plan are held separately from the company in independently administered funds.

Defined contribution pension plan

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further obligation. 

Contributions to defined contribution plans are expensed in the period to which they relate.  Amounts not paid are shown in other creditors in the Statement of Financial Position.  The assets of the plan are held separately from the company in independently administered funds.

	Foreign currency translation
	Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to the Income Statement

Foreign currency translation

Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to the Income Statement

	Deferred tax
	Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.

Deferred tax

Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. 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. 

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.

	Intangible assets
	Intangible assets represent patents costs capitalised during the year. These costs are amortised in full during the year in which they are incurred.

	Research and development
	In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. 

If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

	Tangible fixed assets and depreciation
	Tangible fixed assets are stated at cost or valuation less depreciation. Land and buildings are stated at cost (including deemed cost, being the fair value at the date of transition to FRS102) less accumulated depreciation and accumulated impairment losses. Land included within heritable property is not depreciated. If the estimated residual value at the balance sheet date is considered to be equivalent to the cost, no depreciation will be charged. The assets residual values, useful lives and depreciation methods are reviewed and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised in the Income Statement Depreciation is provided on all tangible fixed assets as follows:

Tangible fixed assets and depreciation

Tangible fixed assets are stated at cost or valuation less depreciation. 

Land and buildings are stated at cost (including deemed cost, being the fair value at the date of transition to FRS102) less accumulated depreciation and  accumulated impairment losses. Land included within heritable property is not depreciated. If the estimated residual value at the balance sheet date is considered to be equivalent to the cost, no depreciation will be charged.

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

Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised in the Income Statement

Depreciation is provided on all tangible fixed assets as follows:


	Reducing balance (%)	Straight line (years)
Plant and machinery	15	-
Fixtures and fittings	15	-
Vehicles	-	4
Office Equipment	-	4

	Stocks and work in progress
	Stocks are valued at the lower of cost and estimated selling price (less any associated costs to enable such sales to complete). At each date of Statement of Financial Position, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Income Statement. Work in progress is valued on the basis of direct costs plus attributable overheads based on normal level of activity. Provision is made for any foreseeable losses where appropriate. No element of profit is included in the valuation of work in progress.

Stocks and work in progress

Stocks are valued at the lower of cost and estimated selling price (less any associated costs to enable such sales to complete). 

At each date of Statement of Financial Position, stocks are assessed for impairment.  If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell.  The impairment loss is recognised immediately in the Income Statement.

Work in progress is valued on the basis of direct costs plus attributable overheads based on normal level of activity. Provision is made for any foreseeable losses where appropriate. No element of profit is included in the valuation of work in progress.

	Trade and other debtors
	Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.

Trade and other debtors

Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.

	Trade and other creditors
	Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method.

	Financial instruments
	The company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

2.	Average number of employees


		2025		2024
	Average number of employees during the year	34		35

3.	Intangible assets

	Other	Total
	£	£
Cost or valuation
At 01 January 25	57,503	57,503
At 31 December 25	57,503	57,503
Amortisation and impairment
At 01 January 25	57,503	57,503
At 31 December 25	57,503	57,503
Net book value
At 31 December 25	-	-
At 31 December 24	-	-

4.	Tangible fixed assets

	Land & buildings	Plant & machinery	Vehicles	Fixtures & fittings	Total
	£	£	£	£	£
Cost or valuation
At 01 January 25	1,365,729	864,236	407,287	492,906	3,130,158
Additions	-	49,774	39,925	31,454	121,153
Disposals	-	(385,651)	(81,205)	(297,889)	(764,745)
At 31 December 25	1,365,729	528,359	366,007	226,471	2,486,566
Depreciation and impairment
At 01 January 25	-	562,916	282,300	394,810	1,240,026
Charge for year	-	48,229	47,659	33,448	129,336
On disposals	-	(380,862)	(76,623)	(292,046)	(749,531)
At 31 December 25	-	230,283	253,336	136,212	619,831
Net book value
At 31 December 25	1,365,729	298,076	112,671	90,259	1,866,735
At 31 December 24	1,365,729	301,320	124,987	98,096	1,890,132


	If heritable property had not been revalued it would have been included at historical cost of £1,177,029 (2024: £1,177,029)

5.	Stocks

	2025	2024
	£	£
Raw materials and consumables	2,177,597	2,493,060
Total	2,177,597	2,493,060

6.	Debtors: amounts due within one year

	2025	2024
	£	£
Trade debtors / trade receivables	504,285	664,431
Other debtors	291,871	270,184
Prepayments and accrued income	96,497	108,003
Total	892,653	1,042,618

7.	Creditors: amounts due within one year

	2025	2024
	£	£
Trade creditors / trade payables	62,068	120,755
Taxation and social security	247,527	304,658
Other creditors	19,018	63,641
Accrued liabilities and deferred income	155,886	87,295
Total	484,499	576,349

8.	Provisions for liabilities

	2025	2024
	£	£
Net deferred tax liability (asset)	109,834	108,412
Total	109,834	108,412

9.	Related party transactions
	Included in other debtors is a loan of £196,932 (2024: £26,419) to Mrs E A Horne, who was the mother of the directors. During the year interest of £1,278 (2024: £139) was charged on the loan. The loan has no fixed repayment terms. Included in other debtors is a loan of £nil (2024: £197,305) to Mr A D Horne, who was a director until his death in July 24. On settlement of his estate the loan balance was transferred to Mrs E A Horne. During the year interest of £6,976 (2024: £3,757) was charged on the loan.

Related party transactions

Included in other debtors is a loan of £196,932 (2024: £26,419) to Mrs E A Horne, who was the mother of the directors. During the year interest of £1,278 (2024: £139) was charged on the loan. The loan has no fixed repayment terms.

Included in other debtors is a loan of £nil (2024: £197,305) to Mr A D Horne, who was a director until his death in July 24.  On settlement of his estate the loan balance was transferred to Mrs E A Horne. During the year interest of £6,976 (2024: £3,757) was charged on the loan.

	Notes	2025		2024
		£	£	£	£
Fixed assets
Tangible assets	4		1,866,735		1,890,132
			1,866,735		1,890,132
Current assets
Stocks	5	2,177,597		2,493,060
Debtors	6	892,653		1,042,618
Cash at bank and on hand		3,499,635		2,631,676
		6,569,885		6,167,354
Creditors amounts falling due within one year	7	(484,499)		(576,349)
Net current assets (liabilities)			6,085,386		5,591,005
Total assets less current liabilities			7,952,121		7,481,137
Provisions for liabilities	8		(109,834)		(108,412)
Net assets			7,842,287		7,372,725
Capital and reserves
Called up share capital			3,808		3,808
Revaluation reserve			161,517		161,517
Other reserves			1,192		1,192
Profit and loss account			7,675,770		7,206,208
Shareholders' funds			7,842,287		7,372,725