Annual Report and Accounts 2012 - Scapa

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Statement of Accounting Policies Basis of accounting These financial statements have been prepared on a going concern basis under the historical cost convention, as modified by revaluation of certain financial instruments in accordance with the Companies Act 2006 and applicable UK accounting standards. A summary of the Company’s principal accounting policies is set out below. These have been applied consistently throughout the year and prior year. Going concern The Directors have at the time of approving the financial statements 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 financial statements. Further detail is contained in the Directors’ report on page 20. Tangible fixed assets Tangible fixed assets are stated at cost less cumulative depreciation and impairment. Depreciation is provided on the basis of writing off the cost of the relevant assets over their expected useful lives. The Company applies the straight line method. The effect is to reduce the cost of plant, machinery and fixtures to estimated residual value over a period of 5-20 years. Taxation Current tax is provided at amounts expected to be paid or recovered using the tax rates and laws that have been 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 where transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the balance sheet date. Timing differences are differences between the Company’s taxable profits and losses and its results as stated in the financial statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the financial statements. A net deferred tax asset is regarded as recoverable and therefore recognised only to the extent that, on the basis of all available evidence, 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 is measured at the average tax rates that are expected to apply in the periods in which the timing differences are expected to reverse based on tax rates and laws that have been substantively enacted by the balance sheet date. Deferred tax is measured on a non-discounted basis. Provisions Provisions are made in accordance with FRS 12 where an obligation exists for a future liability in respect of a past event and where the amount of obligation can be reliably estimated. Provision is made for vacant and sub-let leasehold properties to the extent that future rental payments are expected to exceed future rental income and for all other known liabilities which exist at the Balance Sheet date, based on management’s best estimate as to the cost of settling these liabilities. Pension costs For defined benefit schemes the amounts charged to operating profit are the current service costs and gains and losses on settlements and curtailments. They are included as part of staff costs. Past service costs are recognised immediately in the profit and loss account if the benefits have vested. If the benefits have not vested immediately, the costs are recognised over the period until vesting occurs. Actuarial gains and losses are recognised immediately in the Statement of Total Recognised Gains and Losses. Defined benefit schemes are funded, with the assets of the scheme held separately from those of the Group, in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the scheme liabilities. The actuarial valuations are obtained annually and are updated at each balance sheet date. The resulting defined benefit asset or liability, net of the related deferred tax, is presented separately after other net assets on the face of the Balance Sheet. For defined contribution schemes the amount charged to the profit and loss account in respect of pension costs and other postretirement benefits is the contributions payable in the year. Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the Balance Sheet. Fixed asset investments Fixed asset investments are stated at cost, less provision for any impairment in value. Where circumstances indicate that there may have been impairment in the carrying value of a tangible or intangible fixed asset, an impairment review is carried out using cash flows from approved forecasts and projections discounted at the Group’s weighted average cost of capital. Share-based payments The fair value of employee share options plans is calculated using the appropriate valuation models in accordance with FRS 20 ‘Share-based payments’. The resulting cost is charged to the profit and loss account over the vesting period of the options. The value of the charge is adjusted to reflect expected and actual levels of options vesting. Where share options are granted to employees of subsidiary companies, the cost is debited to the carrying value of the subsidiary investments. 78 Scapa Group plc Annual Report and Accounts 2012
Foreign currencies Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Sterling at the rate of exchange at the Balance Sheet date. Exchange differences on borrowings (including differences arising due to currency swaps) taken out to hedge overseas equity investments and on long-term loans which are considered equivalent to equity are taken to the translation reserve. All other differences are taken to the profit and loss account. Cash flow statement The Company is a wholly-owned subsidiary of Scapa Group plc and is included in the consolidated financial statements of Scapa Group plc which are publicly available. Consequently, the Company has taken advantage of the exemption from preparing a cash flow statement under the terms of FRS 1 ‘Cash Flow Statements’ (revised 1996). Consolidation Consolidated accounts for the company are prepared under International Accounting Standards and as a result these financial statements present information about the Company only. Related parties The Directors’ Remuneration Report can be found in the Group accounts. There are no other related party transactions. The Company is exempt under the terms of FRS 8 from disclosing related party transactions with entities that are wholly owned subsidiaries. Scapa Group plc Annual Report and Accounts 2012 79 Overview Business Review Governance Financial Statements
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Annual Report and Accounts 2012 Gro
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Sector split Electronics Healthcare
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Chairman’s Statement A focus on s
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“Our goal is to deliver sustainab
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Revenue £145.9m +0.2% 74.6% of Gro
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Revenue £39.5m +16.9% 20.2%of Grou
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Revenue £10.2m -20.9% 5.2% of Grou
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KPIs Return on sales (*1) 5.5% Trad
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Lost Time Accidents (LTAs) FY12 FY1
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We take the view that the policies
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Introduction At the heart of how Sc
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Leadership Team L-R: Ian Marchant,
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Scapa has a combination of unionise
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Directors’ Remuneration Report Th
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Other benefits Purpose Policy for e
Page 31 and 32: Directors’ interests As of 31 Mar
Page 33 and 34: Corporate Governance “ Good gover
Page 35 and 36: Internal control system In accordan
Page 37 and 38: Under its terms of reference, the A
Page 39 and 40: Independent Auditor’s Report to t
Page 41 and 42: Consolidated Balance Sheet As at 31
Page 43 and 44: Consolidated Cash Flow Statement Fo
Page 45 and 46: Consolidation The consolidated fina
Page 47 and 48: Property, plant and equipment (incl
Page 49 and 50: The liability recognised in the Bal
Page 51 and 52: Notes on the Accounts 1. Segmental
Page 53 and 54: 2. Segment assets and liabilities c
Page 55 and 56: 6. Key management compensation and
Page 57 and 58: 9. Taxation continued Movement in u
Page 59 and 60: 13. Goodwill Cost 1 April 34.2 45.8
Page 61 and 62: 16. Assets held for sale During the
Page 63 and 64: 22. Borrowings Amounts due within o
Page 65 and 66: 23. Derivative financial instrument
Page 67 and 68: 24. Provisions continued During the
Page 69 and 70: 25. Retirement benefit liabilities
Page 75 and 76: 27. Share options continued US Stoc
Page 77 and 78: 29. Commitments Capital commitments
Page 79 and 80: Scapa Group plc Parent Company Fina
Page 81: Company Balance Sheet As at 31 Marc
Page 85 and 86: 4. Investments Shares in Group unde
Page 87 and 88: 10. Share capital Allotted, issued
Page 89 and 90: 12. Pension schemes continued Five
Page 91 and 92: Designed by luminous.co.uk
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