The directors present the strategic report for the year ended 31 March 2025.

The 2024/25 financial year marked the beginning of our third five-year business planning cycle, during which the business generated a turnover of £17 million. However, performance fell short of both the turnover and profit targets established for the year under that plan.

2023/24 was a pivotal year for the business, marked by a change in share ownership through the mid-year completion of a partial management buyout, and for the first time, the appointment of an external candidate to the role of Managing Director. This leadership transition was set to propel us into our next growth cycle, bringing fresh energy and perspective to the business. However during 2024/25 performance declined for a number of reasons, both internal and external, and it became apparent that the changes to share ownership, management and governance were not delivering the performance envisaged. As a result, in February 2025 Mark Seaborn, resumed the role of Managing Director. While the impact of the MBO and failed leadership transition provided additional challenges, our financially strong foundations, commitment to innovation, and diligent cost and cash management have positioned us well to navigate challenging environments and continue progressing toward our long-term future growth aspirations.

In 2024/25, the economy showed early signs of recovery, with rising real wages, stronger GDP growth, and improving consumer sentiment. However, household cash flow remained constrained, largely due to lingering cost pressures in the economy such as high mortgage costs. Inflation was expected to remain between 2.5% and 2.8% through 2025 and while the peak of the cost-of-living crisis has hopefully passed, the focus has shifted to managing its aftermath particularly in areas like consumer spending and labour market dynamics. Client finances also changed over the course of 2024/25 from recovery post Covid, to a reduction in spend and activity, which flowed through into both reduced client demand for services, reductions in their internal staffing resources and a lack of clarity and scale around investment programs.

These economic conditions, along with significant investment in technology had a material impact on our financial performance. Inflation has continued to drive up our overall cost of delivery and the trading environment throughout 2024/25 remained challenging, as some clients reduced spending at the same time that we faced increased operational costs. Salary inflation was a significant factor for us in 2024/25, particularly in technical roles with annual increases in the range of 10-15% in some disciplines.

In response, the Board sought to mitigate the impact of increased operational costs by negotiating commensurate increases to client contracts and managing our costs tightly where possible. This strategy helped us to remain competitive in crucial aspects of the business, particularly in recruitment and retention of staff.

Our methodology for financial reporting will continue to be innovative, accurate and timely, empowering directors and managers to make early interventions and informed business decisions. We will also continue to foster cohesion and alignment across key functional areas of the business, including sales, finance, and operations to continue to support sustained and strategic growth.

As we embark on the next phase of our next 5-year growth journey concluding in March 2029, we do so with optimism and determination. The years ahead will bring both transformation and opportunity as we work to further expand the business. Our Strategy is anchored by three core facets: deepening our understanding of sales, strengthening our market position, and driving process improvements through technological innovation. Guided by our mission, vision and values, we remain committed to ensuring that Pennington Choices continues to be a great place to work and thrives within an ever-evolving marketplace.

On at least an annual basis, we identify all pertinent strategic risks as part of our business planning process, with emerging risks being addressed as they arise during fortnightly Senior Management Team (SMT) Meetings. Through our embedded approach to risk management, the Board and wider company are well placed to navigate any uncertainty and effectively manage the risks.

The Strategic Risk Register, managed by Corporate Services, is reviewed and updated quarterly with additional updates as needed for emerging risks. Each service area maintains its own Service Risk Register and relevant Project Managers manage Project RAAIDD (Risk, Assumption, Actions, Issues, Decisions, Dependencies) logs. The following are the top strategic risks and challenges with the biggest potential impact on the business:

Compliance and Quality Standards: Ensuring compliance and maintaining high-quality standards are essential to our operations. All managers and employees are responsible for operating safely and efficiently, guided by our accredited service delivery procedures which require Risk Assessment and Method Statements (RAMS) for all work. These RAMS help to identify and mitigate project risks through clearly defined control measures. The Board holds overall responsibility for this policy.

Our Business Continuity Management Plan is based on our strategic risk register and is designed to ensure resilience and the continuity of business-critical services during major incidents. It guarantees service delivery to customers, whilst supporting recovery operations. We record all major incidents or 'near misses' and update the plan accordingly. Business continuity is further embedded through employee training, rehearsal exercises and regular plan reviews. We conduct scenario-based testing every six months to enhance our ability to manage threats to service delivery. The plan outlines Incident Management Team roles and responsibilities, immediate response protocols, site closures and procedures for standing down the plan.

Recruitment and Retention of Staff: Recruitment and retention have remained a significant challenge over the past 12 months. In response, we placed greater emphasis on proactive recruitment, ensuring we hire ahead of need, and continue to invest in employee development to maximise long-term retention. Our strategic talent management approach is designed to attract, retain, and develop the best people, ensuring we deliver services to the highest standard and achieve our business goals. This strategy encompasses six core elements, including business context, assessing talent, developing people, attracting talent, retaining key people and succession planning. We will continue to invest in trainees to build the future of the business and are committed to enhancing our induction process to provide every new employee with a welcoming, informative and exceptional introduction to the organisation.

Climate Change and Net Zero: Addressing climate change and operating sustainably presents both a strategic challenge and a significant opportunity. We are committed to reducing our current Greenhouse Gas (GHG) emissions and have set ambitious yet achievable targets to become Carbon Neutral by 2030. This commitment is outlined in our Carbon Reduction Plan (CRP), which captures our current position based on data collected as part of our ISO14064 accreditation and provides a clear roadmap with key milestones and targets to achieve our goals.

We recognise our responsibility to support clients in meeting their own net zero targets. To enable this, we have developed a robust infrastructure for data collection and reporting that enables us to share our environmental management model (accredited to ISO14001) and GHG emission data from our service delivery. Additionally, we offer direct support to clients on their Net zero journey, whether related to their building portfolios or broader organisational activities. Our experts, equipped with industry-leading insights, will work alongside our clients to provide innovative and effective solutions.

While our core service offerings have historically been influenced by government policy and legislation, we do not anticipate any major policy changes regarding climate change and net zero that would negatively impact our services. Nonetheless, we remain vigilant and ready to respond to any emerging risks or developments.

We are also proud to have achieved B Corp certification, a reflection of our ongoing commitment to meeting the highest standards of social and environmental performance, transparency, and accountability.

IT Infrastructure: A robust IT infrastructure and strategy are essential for delivering services securely and efficiently, while enabling continuous improvement across our business processes and systems. Staying ahead of technological advancements is critical to streamlining operations, enhancing performance, and driving profitability. We have made significant strides in integrating digital solutions, including software upgrades such as SimPRO, our cloud-based project management tool, and HubSpot, our CRM system for sales and marketing. These tools have strengthened our operational efficiency and client engagement capabilities.

Operating in a highly competitive market, we must continue to improve efficiency, deliver greater value to clients and customers, and ensure our resources are aligned to meet demand. Clients now expect a sophisticated approach to resident liaison, including 24/7 online appointment booking, webchat, text messaging, and extended hours for email responses, often from 8am to 8pm. There is also growing demand for real-time job status updates through client portals and for seamless data integration between our IT systems and those of our clients. This reduces manual input, improves data accuracy, lowers costs, and supports clients in meeting their compliance obligations, such as the provision of timely stock condition surveys for the Regulator of Social Housing.

To support this, we have adopted Alpha Tracker, the market leading software for managing asbestos surveys which enables automated and secure data transfer directly into client systems, eliminating the need for manual file sharing. Later this year in 2025, Alpha Tracker will integrate with our new logistics software, FLS, which will revolutionise appointment scheduling by dynamically reducing travel times and boosting productivity.

We have also strengthened our internal IT security and processes. Key initiatives include the deployment of Mimecast for email filtering and the migration of critical data and systems to a secure cloud-based network. These enhancements have improved system integration and resilience, resulting in us obtaining both Cyber Essentials Plus and Bullet Proof Penetration certification.

Business systems development and data management will remain strategic priorities in 2025/26, as we continue to invest in technologies that support operational excellence, security, and client satisfaction.

Financial Health - Effective Financial Management

In 2024/25, our turnover increased modestly compared to the previous year, reflecting our continued growth aspirations. However, overall performance fell short of expectations with revenue and gross profit (GP) both underperforming against budget. We achieved a GP of £10.5 million (62%), against a budgeted GP target of £11.5 million (57%). As detailed previously, the year presented a number of challenges. Increased costs related to recruitment, salaries and investments in IT infrastructure placed pressure on our cost of delivery ultimately impacting resource management, operational efficiency, and profitability. Despite these obstacles, we remain resilient and adaptable, demonstrating our ability to navigate a demanding operating environment.

Looking ahead, the Board remains steadfast in its commitment to achieving the ambitious targets outlined in our current 5-year business plan, which will run from April 2024 to March 2029. Our primary financial Key Business Objective (KBO) is to achieve sustained EBITDA growth, with a target of reaching a net profit of £4 million by the end of the plan period. Additionally, we have set financial objectives focused on cash flow management, strong debtor control, and disciplined cost management, all overseen by our finance team. These objectives are critical to maintaining our growth trajectory and securing long-term success.

Service Delivery/Productivity KPIs

We actively manage service delivery and productivity across all sectors of our business operations to ensure that we consistently meet or exceed client expectations. During the project mobilisation phase, we collaborate with clients to establish a comprehensive suite of key performance indicators (KPIs) that serve as the foundation for assessing our service performance. Continuous improvement is at the core of our approach, enabling us to refine and enhance our service offerings and consistently deliver high-quality services that represent value for money.

To ensure that each project meets these high standards, we appoint a director who is responsible for achieving value for money and ensuring that the contract aligns with both our ISO9001 accreditation and the specific requirements of our clients. Each business stream upholds its own service-specific accreditations, adhering to stringent delivery standards, such as UKAS 17020/17025 for Asbestos services, BAFE, IFE, and FPA for fire safety, and RICS for building surveying activities.

For every project, a contract manager is designated to build strong relationships and maintain clear lines of communication with client stakeholders. Our performance is tracked, measured, and reported against the pre-agreed KPI/SLA metrics during regular formal meetings with our clients. For instance, our internal KPI for void properties across all asbestos contracts this financial year is to achieve a 95% completion rate within 3 days. Each project review meeting includes a dedicated agenda item to discuss KPI performance, health and safety, continuous improvement, as well as latest industry developments relating to guidance, best practice and legislation.

We are committed to continuous improvement, guided by our Continuous Improvement Policy and our ISO9001 quality management system. We conduct annual reviews and external audits to ensure the ongoing effectiveness of this system. This process includes identifying opportunities to enhance our services through lessons learned, KPI analysis, and client feedback. Furthermore, we have a formal review process for all projects, incorporating a holistic analysis of our performance against both external and internal KPIs throughout the contract term. We also benchmark our performance against similar contracts to ensure we maintain high standards.

Finally, we apply lessons learned from previous projects to our future operational methodology and models, ensuring that we continuously evolve and improve our service delivery. This commitment to reflection and adaptation allows us to stay ahead of industry trends and maintain our reputation for excellence in service delivery.

Staff Engagement

One of the most significant factors limiting our growth and commercial success is our ability to recruit and retain sufficient top talent. We have long recognised this challenge and have made it a Key Business Objective to be an excellent employer of exceptional people. We measure our employee engagement annually by participating in the Best Companies employee engagement survey, with the goal of maintaining our recognition as one of the top mid-sized companies to work for in the UK, consistently achieving a 1* or above accreditation.

In 2024, despite all the business pressures, we proudly retained our 1* accreditation and achieved our highest ever ranking in the Best Companies Top 100 list. This recognition reflects our ongoing commitment to fostering a workplace where our employees can feel valued, supported and empowered to thrive.

This year, we made significant investments in our people and organisational capabilities. We focused on enhancing the development of our team through targeted training and developmental activities, as well as ensuring that our salary offerings are competitive with market rates. Our goal is to create an environment where our people can flourish, benefiting both our clients and our business.

In 2024, we achieved Gold accreditation from Investor in Customers, reinforcing our vision and commitment to continuous improvement. This accreditation highlights our proactive approach to seeking feedback, which enables us to refine and improve our processes, services, and overall customer satisfaction. Achieving Gold not only recognises our success in providing high-quality experiences for both our customers and employees, but also reinforces the trust and confidence that our stakeholders have in our brand. This trust is crucial as we strive to continue attracting and retaining top talent and clients.

We continue to promote our Employer Brand campaign # LifeAtPC, which shows what it's like to work at Pennington Choices. The campaign features content from our employees, offering potential recruits a glimpse into our culture and values, allowing them to "look through the window" and experience what it means to be part of our team. By attracting the best new talent and retaining our existing talented people, # LifeAtPC strengthens our team and fosters a positive work environment.

Our commitment to attracting and retaining staff has been a key driver behind the implementation of our people plan. This plan focuses on organisational development, with a view to continuously improving company performance in a rapidly evolving environment, subsequently enhancing the experiences of both employees and stakeholders. As part of this initiative, we introduced meaningful changes to our working environment, including a reduction in the standard workweek from 40 hours to 37.5 hours. These efforts have contributed to a steady year-on-year reduction in staff turnover, from 37% in 2021/22, to 30% in 2022/23, to 26% in 2023/24 and down to 21% in 2024/25.

As part of our people plan we introduced new internal communication channels, leading to higher engagement levels across social platforms and increased employee participation in company-organised events. We remain committed to strengthening our employer brand and promoting a positive and inclusive company culture. A key milestone in this journey was achieving B Corp certification in 2024/25, reflecting our commitment to balancing people, planet, and profit. We believe this certification plays a vital role in supporting our efforts to attract and retain top talent, boosting employee engagement levels and enhancing our reputation among prospective recruits and clients.

On behalf of the board

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

The principal activity of the company in the year under review was that of property surveying, consultancy and project management services.

The results for the year are set out on page 14.

Ordinary dividends were paid amounting to £965,734. The directors do not recommend payment of a final dividend.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The directors are responsible for preparing the annual report 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 of the profit or loss of the company 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 UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• 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 transactions and disclose with reasonable accuracy at any time the financial position of the company 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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 company'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 company's auditors are aware of that information.

We have audited the financial statements of Pennington Choices Limited (the 'company') for the year ended 31 March 2025 which comprise the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity and notes to the financial statements, including 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 company's affairs as at 31 March 2025 and of its 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company 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 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 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 our audit:

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

• the 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.

As explained more fully in the directors' responsibilities statement, 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 is 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 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 company or to cease operations, or have no realistic alternative but to do so.

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 an auditor's report 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.

• 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 company through discussions with directors and other management, and from our commercial knowledge and experience of the company;

• we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; 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 company's 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; and

• assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias.

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;

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

reviewing correspondence with HMRC and relevant regulators.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance.

Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member in an auditor's report 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 member, for our audit work, for this report, or for the opinions we have formed.

The income statement has been prepared on the basis that all operations are continuing operations.

Pennington Choices Limited is a private company limited by shares incorporated in England and Wales. The registered office is Brookfield House, Tarporley Road, Norcott Brook, Warrington, Cheshire, England, WA4 4EA.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

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 £.

The financial statements have been prepared under the historical cost convention.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 33 ‘Related Party Disclosures'.

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.

Preparation of consolidated financial statements

The company has taken advantage of the exemption under Section 405 of the Companies Act 2006 to exclude subsidiary undertakings from the consolidated financial statements on the grounds they are immaterial to the financial statements for the purposes of showing a true and fair view

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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 the financial statements.

Turnover is recognised to the extent it is possible that the economic benefits will flow to the company and it can be measured reliably. Turnover is measured at fair value of the consideration received or receivable, excluding discounts, rebates and VAT.

The nature, timing of satisfaction of performance obligations and significant payment terms of the company's major sources of revenue are as follows:

Amounts recoverable on contracts

Amounts recoverable on contracts is valued at the stage of completion of unbilled services rendered at the balance sheet date.

Goodwill, being the excess of the cost of business combinations over the the acquirer's interest in the net amount of identifiable assets and liabilities, is initially valued at cost. After initial

recognition, it is measured at cost less any accumulated amortisation and impairment losses.

Amortisation is provided on a straight line basis over the useful economic life which the directors consider to be 10 years.

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

Depreciation is provided at the following annual rates in order to write off the cost less estimated

residual value of each asset over its estimated useful life.

Tangible fixed assets are initially measured at cost. After initial recognition they are measured at cost less any accumulated depreciation and impairment losses.

Investments in subsidiary undertakings are recognised at cost.

The following assets and liabilities are classified as financial instruments - Trade debtors, trade creditors, other creditors, intercompany accounts and directors loan accounts. All balances due within one year are all measured at the undiscounted amount of cash and other consideration expected to be paid or received. Balances due in greater than one year have been discounted to their present value at the balance sheet date using an appropriate rate of borrowing.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

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

Short term employee benefits, incuding holiday pay are recognised as an expense in the income statement in the period in which they are incurred

The company operates a defined contribution pension scheme. Contributions payable to the

company's pension scheme are charged to profit or loss in the period to which they relate.

The company is required to make certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

The company enters into contracts with its customers. At each reporting date the directors perform an assessment to determine the stage of completion of contracts to determine the total revenue to be recognised. Assessing stage of completion requires the directors to apply estimates and judgements which could differ from actual results.

The average monthly number of persons (including directors) employed by the company during the year was:

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The ultimate controlling party is Pennington Choices Group Limited by virtue of their controlling interest.

The immediate parent company of the largest and smallest group that includes the company and or which group financial statements are prepared is Pennington Choices Group Limited. Copies of Pennington Choices Group Limited financial statements can be obtained from the registered office at Brookfield House, Tarporley Road, Norcott Brook, Warrington, WA4 4EA.