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RULA DEVELOPMENTS (EUROPA) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2026
2.Accounting policies (continued)
Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Work in progress comprises of developments in progress and land held for development or sale. Deposit payments to acquire land are included in prepayments. Property developments in progress include properties being developed for onward sale. Land held for development or sale, is land owned by the company this is promoted through the planning process in order to gain planning permission, adding value to the land.
Work in progress is valued at the cost of third party supplies incurred on ongoing contracts at the balance sheet date. The value of work in progress excludes any profit element and any allocation of staff costs.
Impairment reviews are considered on a site by site basis or individual development basis by management at each reporting date. Write downs or revaluations are then made to ensure that work in progress is stated at lower of cost and net realisable value.
Net realisable value is considered in the light of progress made in the planning process, feedback from local planning officers, development appraisals and other external factors that might be considered likely to influence the eventual outcome. Where it is considered that no future benefit will arise, costs are written off the profit and loss account.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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