Abbreviated Company Accounts - CADNET SOLUTIONS LIMITED

1Accounting Policies

Basis of measurement and preparation of accounts
The full financial statements, from which these abbreviated accounts have been extracted, have
been prepared under the historical cost convention and in accordance with applicable accounting
standards.

Turnover policy
Turnover comprises revenue recognised by the company in respect of goods and services supplied
during the year, exclusive of Value Added Tax and trade discounts.

Tangible assets depreciation policy
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates
calculated to write off the cost of fixed assets, less their estimated residual value, over their
expected useful lives on the following bases:
Motor vehicles - 25% reducing balance
Fixtures and fittings - 15% straight line
Office equipment - 15% straight line

Intangible assets amortisation policy
Goodwill is the difference between amounts paid on the acquisition of a business and the fair value
of the identifiable assets and liabilities. It is amortised to the Profit and loss account over its
estimated economic life.
Research expenditure is written off to the profit and loss account in the year in which it is incurred.
Development expenditure is written off in the same year unless the directors are satisfied as to the
technical, commercial and financial viability of individual projects. In this situation, the expenditure is
deferred and amortised over the period from which the company is expected to benefit.
Amortisation is provided at the following rates:
Development expenditure - 20% straight line

Other accounting policies
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed
assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their
useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases
are those where substantially all of the benefits and risks of ownership are assumed by the
company. Obligations under such agreements are included in creditors net of the finance charge
allocated to future periods. The finance element of the rental payment is charged to the Profit and
loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in
each period.

Operating leases
Rentals under operating leases are charged to the Profit and loss account on a straight line basis
over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a
straight line basis over the period until the date the rent is expected to be adjusted to the prevailing
market rate.

Stocks and work in progress
Stocks and work in progress are valued at the lower of cost and net realisable value after making
due allowance for obsolete and slow-moving stocks. Cost includes all direct costs and an
appropriate proportion of fixed and variable overheads.

Deferred taxation
Full provision is made for deferred tax assets and liabilities arising from all timing differences
between the recognition of gains and losses in the financial statements and recognition in the tax
computation.
A net deferred tax asset is recognised only if it can be regarded as more likely than not that there will
be suitable taxable profits from which the future reversal of the underlying timing differences can be
deducted.
Deferred tax assets and liabilities are calculated at the tax rates expected to be effective at the time
the timing differences are expected to reverse.

Pensions
The company operates a defined contribution pension scheme and the pension charge represents
the amounts payable by the company to the fund in respect of the year.