| TAS Holdings Limited | |
Consolidated financial statements | |
| 30 September 2009 |
| Independent auditors’ report to the members of TAS Holdings Limited | 1 |
| Consolidated Income Statements | 2 |
| Consolidated Statements of Changes in Equity | 3 |
| Consolidated Balance Sheets | 4 |
| Consolidated Cash Flow Statements | 5 |
| Notes | 6 |
Independent auditors' report to the members of TAS Holdings Limited
We have audited the accompanying consolidated balance sheets of TAS Holdings Limited (and subsidiaries) as of September 30, 2009 and 2008, and the related consolidated income statements, consolidated statements of changes in equity, and consolidated cash flow statements for the years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as eval uating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of TAS Holdings Limited (and subsidiaries) as of September 30, 2009 and 2008, and the results of their operations and their cash flows for the years then ended in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
/s/ KPMG LLP
KPMG LLP
Newcastle upon Tyne
England, UK
1 July 2010
1
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Consolidated Income Statements
for the years ended 30 September
| Note | 2009 | 2008 | ||||||||||
| £ | £ | |||||||||||
| Revenue | 2 | 2,406,907 | 1,930,935 | |||||||||
| Cost of sales | (1,601,288 | ) | (1,241,170 | ) | ||||||||
| Gross profit | 805,619 | 689,765 | ||||||||||
| Administrative expenses | (591,170 | ) | (498,262 | ) | ||||||||
| Operating profit | 214,449 | 191,503 | ||||||||||
| Financial income | 6 | 825 | 172 | |||||||||
| Financial expenses | 6 | (20,425 | ) | (24,057 | ) | |||||||
| Profit before tax | 194,849 | 167,618 | ||||||||||
| Income tax expense | 7 | (38,391 | ) | (34,273 | ) | |||||||
| Profit for the year | 17 | 156,458 | 133,345 | |||||||||
2
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Consolidated Statements of Changes in Equity for the years ended 30 September | |||||||||||
| Capital | |||||||||||
| Share | Share | redemption | Retained | Total | |||||||
| capital | premium | reserve | earnings | equity | |||||||
| £ | £ | £ | £ | £ | |||||||
| At 1 October 2007 | 62,000 | 48,800 | - | 4,240 | 115,040 | ||||||
| Profit for the year | - | - | - | 133,345 | 133,345 | ||||||
| Own shares acquired | (8,578) | - | 8,578 | (15,955) | (15,955) | ||||||
| At 30 September 2008 | 53,422 | 48,800 | 8,578 | 121,630 | 232,430 | ||||||
| At 1 October 2008 | 53,422 | 48,800 | 8,578 | 121,630 | 232,430 | ||||||
| Profit for the year | - | - | - | 156,458 | 156,458 | ||||||
| At 30 September 2009 | 53,422 | 48,800 | 8,578 | 278,088 | 388,888 | ||||||
3
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Consolidated Balance Sheets
at 30 September
| Note | ||||||||||||
| 2009 | 2008 | |||||||||||
| £ | £ | |||||||||||
| Non-current assets | ||||||||||||
| Property, plant and equipment | 8 | 389,153 | 380,807 | |||||||||
| Current assets | ||||||||||||
| Inventories | 11 | 10,903 | 26,195 | |||||||||
| Trade and other receivables | 12 | 268,841 | 262,640 | |||||||||
| Cash and cash equivalents | 13 | 346,843 | 117,414 | |||||||||
| 626,587 | 406,249 | |||||||||||
| Total assets | 1,015,740 | 787,056 | ||||||||||
| Current liabilities | ||||||||||||
| Other interest-bearing loans and borrowings | 14 | (175,878 | ) | (42,015 | ) | |||||||
| Trade and other payables | 15 | (401,397 | ) | (290,655 | ) | |||||||
| Tax payable | (38,391 | ) | (34,273 | ) | ||||||||
| (615,666 | ) | (366,943 | ) | |||||||||
| Non-current liabilities | ||||||||||||
| Other interest-bearing loans and borrowings | 14 | (11,186 | ) | (187,683 | ) | |||||||
| Total liabilities | (626,852 | ) | (554,626 | ) | ||||||||
| Net assets | 388,888 | 232,430 | ||||||||||
| Equity attributable to equity holders of the parent | ||||||||||||
| Share capital | 17 | 53,422 | 53,422 | |||||||||
| Share premium | 17 | 48,800 | 48,800 | |||||||||
| Reserves | 17 | 8,578 | 8,578 | |||||||||
| Retained earnings | 17 | 278,088 | 121,630 | |||||||||
| Total equity | 388,888 | 232,430 | ||||||||||
4
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Consolidated Cash Flow Statements
for the years ended 30 September
| Note | ||||||||||||
| 2009 | 2008 | |||||||||||
| £ | £ | |||||||||||
| Cash flows from operating activities | ||||||||||||
| Profit for the year | 156,458 | 133,345 | ||||||||||
| Adjustments for: | ||||||||||||
| Depreciation | 8 | 44,902 | 44,775 | |||||||||
| Financial income | 6 | (825 | ) | (172 | ) | |||||||
| Financial expense | 6 | 20,425 | 24,057 | |||||||||
| Loss on sale of property, plant and equipment | 8 | 4,904 | 1,159 | |||||||||
| Taxation | 7 | 38,391 | 34,273 | |||||||||
| 264,255 | 237,437 | |||||||||||
| (Increase)/decrease in trade and other receivables | 12 | (6,201 | ) | 39,178 | ||||||||
| Decrease/(increase) in inventories | 11 | 15,292 | (24,695 | ) | ||||||||
| Increase in trade and other payables | 15 | 110,742 | 37,904 | |||||||||
| 384,088 | 289,824 | |||||||||||
| Tax paid | 7 | (34,273 | ) | (3,231 | ) | |||||||
| Net cash from operating activities | 349,815 | 286,593 | ||||||||||
| Cash flows from investing activities | ||||||||||||
| Proceeds from sale of property, plant and equipment | 8 | 5,025 | - | |||||||||
| Interest received | 6 | 825 | 172 | |||||||||
| Acquisition of property, plant and equipment | 8 | (38,652 | ) | (31,755 | ) | |||||||
| Net cash from investing activities | (32,802 | ) | (31,583 | ) | ||||||||
| Cash flows from financing activities | ||||||||||||
| Proceeds from new loan | 14 | - | 64,446 | |||||||||
| Repurchase of own shares | 17 | - | (15,955 | ) | ||||||||
| Repurchase of preference shares | - | (55,200 | ) | |||||||||
| Interest paid | 6 | (20,425 | ) | (24,057 | ) | |||||||
| Repayment of borrowings | 14 | (45,047 | ) | (80,333 | ) | |||||||
| Payment of finance lease liabilities | 14 | (22,112 | ) | (18,126 | ) | |||||||
| Net cash from financing activities | (87,584 | ) | (129,225 | ) | ||||||||
| Net increase in cash and cash equivalents | 229,429 | 125,785 | ||||||||||
| Cash and cash equivalents at 1 October | 117,414 | (8,371 | ) | |||||||||
| Cash and cash equivalents at 30 September | 13 | 346,843 | 117,414 | |||||||||
5
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes
(forming part of the consolidated financial statements)
| 1 | Accounting policies |
TAS Holdings Limited (the “Company”) is a company incorporated and domiciled in the UK. The principal activity of the Group is that of engineering consultants.
The Group financial statements consolidate those of the Company and its subsidiaries (together referred to as the “Group”).
The Group financial statements have been prepared and approved by the directors in accordance with International Financial Reporting Standards as issued by the IASB (“IFRSs”).
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these consolidated financial statements.
Measurement convention
The financial statements are prepared on the historical cost basis.
Going concern
The Company is expected to continue to generate positive cash flows for the foreseeable future and the directors believe it is well placed to manage its business risks successfully despite the current uncertain economic outlook.
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are currently exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
6
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 1 | Accounting policies (continued) |
Foreign currency
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the income statement. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair va lue was determined.
Classification of financial instruments issued by the Group
Financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions:
| (a) | they include no contractual obligations upon the Company (or Group as the case may be) to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the Company (or Group); and |
| (b) | where the instrument will or may be settled in the Company’s own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the Company’s own equity instruments or is a derivative that will be settled by the Company’s exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments. |
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the Company’s own shares, the amounts presented in these financial statements for called up share capital and share premium account exclude amounts in relation to those shares.
Non-derivative financial instruments
Non-derivative financial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables.
Trade and other receivables
Trade and other receivables are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses.
Trade and other payables
Trade and other payables are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.
7
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 1 | Accounting policies (continued) |
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.
Leases in which the Group assumes substantially all the risks and rewards of ownership of the leased asset are classified as finance leases. Where land and buildings are held under leases the accounting treatment of the land is considered separately from that of the buildings. Leased assets acquired by way of finance lease are stated at an amount equal to the lower of their fair value and the present value of the minimum lease payments at inception of the lease, less accumulated depreciation and less accumulated impairment losses. Lease payments are accounted for as described below.
Depreciation is charged to the income statement on a reducing balance basis over the estimated useful lives of each part of an item of property, plant and equipment. Land is not depreciated. Depreciation rates are as follows:
· | fixtures and fittings | 20% |
· | motor vehicles | 25% |
· | computer equipment | 20% |
Depreciation methods, useful lives and residual values are reviewed at each balance sheet date.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is based on the first-in first-out principle and includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs in bringing them to their existing location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of overheads based on normal operating capacity.
Impairment excluding inventories and deferred tax assets
The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment; a financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset. If any such indication exists, the asset’s recoverable amount is estimated.
For assets that have an indefinite useful life the recoverable amount is estimated at each balance sheet date.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the income statement.
8
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 1 | Accounting policies (continued) |
Impairment excluding inventories and deferred tax assets (continued)
Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro rata basis. A cash generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.
Calculation of recoverable amount
The recoverable amount of the Group’s investments in held-to-maturity securities and receivables carried at amortised cost is calculated as the present value of estimated future cash flows, discounted at the original effective interest rate (i.e., the effective interest rate computed at initial recognition of these financial assets). Receivables with a short duration are not discounted.
The recoverable amount of other assets is the greater of their fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.
Reversals of impairment
An impairment loss in respect of a held-to-maturity security or receivable carried at amortised cost is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognised.
In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used to determine the recoverable amount.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which the Company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Contributions to defined contribution pension plans are recognised as an expense in the income statement as incurred.
Provisions
A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability.
Revenue
Revenue is measured at the fair value of consideration received or receivable net of discounts and VAT, provided that it can be measured reliably.
9
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 1 | Accounting policies (continued) |
Expenses
Operating lease payments
Payments made under operating leases are recognised in the income statement on a straight-line basis over the term of the lease.
Finance lease payments
Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Financing income and expenses
Financing expenses comprise interest payable, finance charges on finance leases, unwinding of the discount on provisions, and net foreign exchange losses that are recognised in the income statement (see foreign currency accounting policy). Financing income comprise interest receivable on funds invested, dividend income, and net foreign exchange gains.
Interest income and interest payable is recognised in profit or loss as it accrues, using the effective interest method. Dividend income is recognised in the income statement on the date the entity’s right to receive payments is established. Foreign currency gains and losses are reported on a net basis.
Taxation
Tax on the profit or loss 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 directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised.
| 2 | Revenue |
All revenue is derived from the principal activity undertaken wholly in the UK.
10
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 3 | Expenses and auditors’ remuneration |
Auditors’ remuneration:
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Audit of these financial statements | 22,500 | - | ||||||
| 4 | Staff numbers and costs |
The average number of persons employed by the Group (including directors) during the year, analysed by category, was as follows:
| Number of employees | |||||
| 2009 | 2008 | ||||
| Directors | 2 | 2 | |||
| Administration | 4 | 5 | |||
| Sales | 1 | 2 | |||
| Engineering | 19 | 15 | |||
| 26 | 24 | ||||
The aggregate payroll costs of these persons were as follows:
| 2009 | 2008 | ||||
| £ | £ | ||||
| Wages and salaries | 974,982 | 716,132 | |||
| Social security costs | 96,659 | 78,509 | |||
| Contributions to defined contribution plans | 74,970 | 33,419 | |||
| 1,146,611 | 828,060 | ||||
| 5 | Directors’ remuneration |
| 2009 | 2008 | ||
| £ | £ | ||
| Directors’ emoluments | 56,804 | 60,219 | |
| Company contributions to money purchase pension plans | 51,000 | 15,302 | |
| Number of directors | |||
| 2009 | 2008 | ||
| Retirement benefits are accruing to the following number of directors under: | |||
| Money purchase schemes | 1 | 1 | |
11
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 6 | Finance income and expense |
Recognised in the income statement
| 2009 | 2008 | ||
| £ | £ | ||
| Finance income | |||
| Bank interest | 825 | 172 | |
| 2009 | 2008 | ||
| £ | £ | ||
| Finance expense | |||
| Finance charges payable in respect of finance leases and hire purchase contracts | 3,872 | 3,535 | |
| On loans and overdraft | 16,553 | 20,522 | |
| Total finance expense | 20,425 | 24,057 | |
| 7 | Taxation |
Recognised in the income statement
| 2009 | 2008 | ||
| £ | £ | ||
| Current tax expense | |||
| Current year | 38,391 | 34,273 | |
| Adjustments for prior years | - | - | |
| Total tax expense | 38,391 | 34,273 | |
Reconciliation of effective tax rate
| 2009 | 2008 | ||
| £ | £ | ||
| Profit for the year | 156,458 | 133,345 | |
| Total tax expense | 38,391 | 34,273 | |
| Profit before tax | 194,849 | 167,618 | |
Tax using the UK corporation tax rate of 21% (2008: 21%) | 40,918 | 35,200 | |
| Capital allowances in excess of depreciation | (3,066) | (122) | |
| Non-deductible expenses | 539 | 485 | |
| Utilisation of tax losses brought forward | - | (782) | |
| Reduction in tax rate | - | (508) | |
| Total tax expense | 38,391 | 34,273 | |
12
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 8 | Property, plant and equipment |
Land and buildings | Fixtures & fittings | Motor vehicles | Computer equipment | Total | ||||||||||||||||
| £ | £ | £ | £ | £ | ||||||||||||||||
| Cost | ||||||||||||||||||||
| Balance at 1 October 2007 | 275,000 | 80,551 | 47,433 | 101,803 | 504,787 | |||||||||||||||
| Acquisitions | - | 10,417 | 16,045 | 21,339 | 47,801 | |||||||||||||||
| Disposals | - | - | (3,500 | ) | - | (3,500 | ) | |||||||||||||
| Balance at 30 September 2008 | 275,000 | 90,968 | 59,978 | 123,142 | 549,088 | |||||||||||||||
| Balance at 1 October 2008 | 275,000 | 90,968 | 59,978 | 123,142 | 549,088 | |||||||||||||||
| Acquisitions | - | 2,109 | 24,525 | 36,543 | 63,177 | |||||||||||||||
| Disposals | - | - | (22,899 | ) | - | (22,899 | ) | |||||||||||||
| Balance at 30 September 2009 | 275,000 | 93,077 | 61,604 | 159,685 | 589,366 | |||||||||||||||
| �� | ||||||||||||||||||||
| Depreciation | ||||||||||||||||||||
| Balance at 1 October 2007 | - | 40,940 | 21,751 | 63,156 | 125,847 | |||||||||||||||
| Depreciation charge for the year | - | 10,005 | 10,142 | 24,628 | 44,775 | |||||||||||||||
| Disposals | - | - | (2,341 | ) | - | (2,341 | ) | |||||||||||||
| Balance at 30 September 2008 | - | 50,945 | 29,552 | 87,784 | 168,281 | |||||||||||||||
| Balance at 1 October 2008 | - | 50,945 | 29,552 | 87,784 | 168,281 | |||||||||||||||
| Depreciation charge for the year | - | 10,800 | 8,652 | 24,450 | 44,902 | |||||||||||||||
| Disposals | - | - | (12,970 | ) | - | (12,970 | ) | |||||||||||||
| Balance at 30 September 2009 | - | 61,745 | 25,234 | 113,234 | 200,213 | |||||||||||||||
| Net book value | ||||||||||||||||||||
| At 1 October 2007 | 275,000 | 39,611 | 25,682 | 38,647 | 378,940 | |||||||||||||||
| At 30 September 2008 and 1 October 2008 | 275,000 | 40,023 | 30,426 | 35,358 | 380,807 | |||||||||||||||
| At 30 September 2009 | 275,000 | 31,332 | 36,370 | 46,451 | 389,153 | |||||||||||||||
Leased plant and machinery
At the balance sheet date the net carrying amount of leased fixtures and fittings was £4,737 (2008: £6,535) and motor vehicles was £32,574 (2008: £15,862). The leased equipment secures lease obligations (see note 14).
Security
The freehold property secures the mortgage (see note 14).
13
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 9 | Investments in subsidiaries |
The Group has the following investments in subsidiaries:
Country of incorporation | Class of shares held | Ownership | ||
| 2009 | 2008 | |||
| Teesside Automation Services Limited | England and Wales | Ordinary | 100% | 100% |
| TAS Engineering Consultants Limited | England and Wales | Ordinary | 100% | 100% |
| Project Engineering Group Limited | England and Wales | Ordinary | 100% | 100% |
14
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 10 | Deferred tax assets and liabilities |
The Group has no significant deferred tax balances.
| 11 | Inventories |
| 2009 | 2008 | ||||
| £ | £ | ||||
| Work in progress | 10,903 | 26,195 | |||
| 12 | Trade and other receivables |
| 2009 | 2008 | ||
| £ | £ | ||
| Other trade receivables | 260,680 | 256,925 | |
| Prepayments | 8,161 | 5,715 | |
| 268,841 | 262,640 | ||
| 13 | Cash and cash equivalents |
| 2009 | 2008 | ||
| £ | £ | ||
| Cash and cash equivalents | 346,843 | 117,414 | |
15
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 14 | Other interest-bearing loans and borrowings |
This note provides information about the contractual terms of the Group’s interest-bearing loans and borrowings, which are measured at amortised cost. For more information about the Group's exposure to interest rate and foreign currency risk, see note 18.
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Non-current liabilities | ||||||||
| Secured bank loans | - | 177,883 | ||||||
| Finance lease liabilities | 11,186 | 9,800 | ||||||
| 11,186 | 187,683 | |||||||
| Current liabilities | ||||||||
| Current portion of secured bank loans | 163,133 | 30,297 | ||||||
| Current portion of finance lease liabilities | 12,745 | 11,718 | ||||||
| 175,878 | 42,015 | |||||||
Terms and debt repayment schedule
| Currency | Nominal interest rate | Year of maturity | Face value | Carrying amount | Face value | Carrying amount | |||||||||||||||||||
| 2009 | 2009 | 2008 | 2008 | ||||||||||||||||||||||
| £ | £ | £ | £ | ||||||||||||||||||||||
| Mortgage | GBP | 8.7 | % | 2010 | 163,133 | 163,133 | 208,180 | 208,180 | |||||||||||||||||
| Finance lease liabilities | GBP | 11.3%-12.8 | % | 2011-2012 | 23,931 | 23,931 | 21,518 | 21,518 | |||||||||||||||||
| 187,064 | 187,064 | 229,698 | 229,698 | ||||||||||||||||||||||
The mortgage was repaid in full in March 2010.
Finance lease liabilities
Finance lease liabilities are payable as follows:
Minimum lease payments | Interest | Principal | Minimum lease payments | Interest | Principal | |||||||||||||||||||
| 2009 | 2009 | 2009 | 2008 | 2008 | 2008 | |||||||||||||||||||
| £ | £ | £ | £ | £ | £ | |||||||||||||||||||
| Less than one year | 14,153 | 1,408 | 12,745 | 12,581 | 863 | 11,718 | ||||||||||||||||||
| Between one and five years | 12,409 | 1,223 | 11,186 | 10,982 | 1,182 | 9,800 | ||||||||||||||||||
| 26,562 | 2,631 | 23,931 | 23,563 | 2,045 | 21,518 | |||||||||||||||||||
16
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 15 | Trade and other payables |
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Current | ||||||||
| Other trade payables | 158,955 | 147,747 | ||||||
| Non-trade payables and accrued expenses | 242,442 | 142,908 | ||||||
| 401,397 | 290,655 | |||||||
| 16 | Employee benefits |
Pension plans
Defined contribution plans
The Group operates a defined contribution pension plan.
The total expense relating to this plan in the current year was £74,970 (2008: £33,419).
| 17 | Capital and reserves |
Reconciliation of movement in capital and reserves
Share capital | Share premium | Capital redemption reserve | Retained earnings | Total equity | ||||||||||||||||
| £ | £ | £ | £ | £ | ||||||||||||||||
| Balance at 1 October 2007 | 62,000 | 48,800 | - | 4,240 | 115,040 | |||||||||||||||
| Profit for the year | - | - | - | 133,345 | 133,345 | |||||||||||||||
| Own shares acquired | (8,578 | ) | - | 8,578 | (15,955 | ) | (15,955 | ) | ||||||||||||
| Balance at 30 September 2008 | 53,422 | 48,800 | 8,578 | 121,630 | 232,430 | |||||||||||||||
| Balance at 1 October 2008 | 53,422 | 48,800 | 8,578 | 121,630 | 232,430 | |||||||||||||||
| Profit for the year | - | - | - | 156,458 | 156,458 | |||||||||||||||
| Balance at 30 September 2009 | 53,422 | 48,800 | 8,578 | 278,088 | 388,888 | |||||||||||||||
17
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
17 Capital and reserves (continued)
Share capital
| Ordinary shares | |||||
| Number of shares | 2009 | 2008 | |||
| On issue at 1 October | 53,422 | 62,000 | |||
| Own shares acquired | - | (8,578) | |||
| On issue at 30 September – fully paid | 53,422 | 53,422 | |||
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Authorised | ||||||||
| Ordinary shares of £1 each | 100,000 | 100,000 | ||||||
| Allotted, called up and fully paid | ||||||||
| Ordinary shares of £1 each | 53,422 | 53,422 | ||||||
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.
During 2008 the Company purchased 8,578 of its own £1 ordinary shares for a total consideration of £15,955, representing a premium on redemption of £7,377.
18
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 18 | Financial instruments |
18 (a) Fair values of financial instruments
Trade and other receivables
The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the market rate of interest at the balance sheet date if the effect is material.
Trade and other payables
The fair value of trade and other payables is estimated as the present value of future cash flows, discounted at the market rate of interest at the balance sheet date if the effect is material.
Cash and cash equivalents
The fair value of cash and cash equivalents is estimated as its carrying amount where the cash is repayable on demand. Where it is not repayable on demand the fair value is estimated at the present value of future cash flows, discounted at the market rate of interest at the balance sheet date.
Interest-bearing borrowings
Fair value, which after initial recognition is determined for disclosure purposes only, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the balance sheet date. For finance leases the market rate of interest is determined by reference to similar lease agreements.
Fair values
The fair values for each class of financial assets and financial liabilities are not considered to be materially different from carrying amounts shown in the balance sheet.
18 (b) Credit risk
Financial risk management
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers.
Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. Therefore, the maximum exposure to credit risk at the balance sheet date was £615,684 (2008: £380,054) being the total of the carrying amount of financial assets.
19
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
18 Financial instruments (continued)
18 (b) Credit risk (continued)
Credit quality of financial assets and impairment losses
The aging of trade receivables at the balance sheet date was:
| Gross | Impairment | Gross | Impairment | |||||||||||||
| 2009 | 2009 | 2008 | 2008 | |||||||||||||
| £ | £ | £ | £ | |||||||||||||
| Not past due | 199,113 | - | 208,457 | - | ||||||||||||
| Past due [0-30 days] | 60,162 | - | 47,456 | - | ||||||||||||
| More than 31 days | 1,405 | - | 1,012 | - | ||||||||||||
| 260,680 | - | 256,925 | - | |||||||||||||
No allowance for impairment in respect of trade receivables has been made.
18 (c) Liquidity risk
Financial risk management
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
20
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
18 Financial instruments (continued)
18 (c) Liquidity risk (continued)
Liquidity risk
The following are the contractual maturities of financial liabilities, including estimated interest payments and excluding the effect of netting agreements:
| 2009 | 2008 | |||||||||||||||||||||||||||||||||||||||
Carrying amount | Contract-ual cash flows | 1 year or less | 1 to <2years | Carrying amount | Contract-ual cash flows | 1 year or less | 1 to <2years | 2 to <5years | 5 years and over | |||||||||||||||||||||||||||||||
| £ | £ | £ | £ | £ | £ | £ | £ | £ | £ | |||||||||||||||||||||||||||||||
| Non-derivative financial liabilities | ||||||||||||||||||||||||||||||||||||||||
| Secured bank loans | 163,133 | 168,658 | (168,658 | ) | - | 208,180 | 297,453 | (33,050 | ) | (33,050 | ) | (99,150 | ) | (132,203 | ) | |||||||||||||||||||||||||
| Finance lease liabilities | 23,931 | 26,562 | (14,153 | ) | (12,409 | ) | 21,518 | 23,563 | (12,581 | ) | (10,982 | ) | - | - | ||||||||||||||||||||||||||
| Trade and other payables | 400,397 | 400,397 | (400,397 | ) | - | 290,655 | 290,655 | (290,655 | ) | - | - | - | ||||||||||||||||||||||||||||
| 587,461 | 595,617 | (583,208 | ) | (12,409 | ) | 520,353 | 611,671 | (336,286 | ) | (44,032 | ) | (99,150 | ) | (132,203 | ) | |||||||||||||||||||||||||
21
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
18 Financial instruments (continued)
18 (d) Market risk
Financial risk management
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of financial instruments.
Market risk arises on interest bearing loans and borrowings.
Market risk - Foreign currency risk
The Group's exposure to foreign currency risk is not significant.
Market risk – Interest rate risk
Profile
At the balance sheet date the interest rate profile of the Group’s interest-bearing financial instruments was:
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Fixed rate instruments | ||||||||
| Financial liabilities | 187,064 | 229,698 | ||||||
Sensitivity analysis
A change of one basis points in interest rates at the balance sheet date would have increased (decreased) equity and profit or loss by the amounts shown below. This calculation assumes that the change occurred at the balance sheet date and had been applied to risk exposures existing at that date.
This analysis assumes that all other variables, in particular foreign currency rates, remain constant and considers the effect of financial instruments with variable interest rates, financial instruments at fair value through profit or loss or available for sale with fixed interest rates. The analysis is performed on the same basis for 2008.
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Equity | ||||||||
| Increase | 910 | 11,329 | ||||||
| Decrease | (910 | ) | (11,329 | ) | ||||
| Profit or loss | ||||||||
| Increase | 910 | 11,329 | ||||||
| Decrease | (910 | ) | (11,329 | ) | ||||
22
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 19 | Operating leases |
Non-cancellable operating lease rentals are payable as follows:
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Between one and five years | 12,972 | 17,304 | ||||||
| 20 | Related parties |
Transactions with key management personnel
Directors of the Company and their immediate relatives control 100 per cent of the voting shares of the Company.
The compensation of key management personnel (including the directors) is as follows:
| 2009 | 2008 | |||||||
| £ | £ | |||||||
| Key management emoluments including social security costs | 56,804 | 60,219 | ||||||
| Company contributions to money purchase pension plans | 51,000 | 15,302 | ||||||
| 107,804 | 75,521 | |||||||
23
TAS Holdings Limited
Consolidated financial statements
30 September 2009
Notes (continued)
| 21 | Ultimate parent company and parent company of larger group |
The ultimate controlling party is J Maplesden, director.
| 22 | Post balance sheet events |
On 26 April 2010 the Company was acquired by GSE Systems Inc, a company incorporated in the United States of America.