AnnuAl RepoRt And Accounts - Mobile Tornado

Accounting policiesNon-monetary items measured at historical cost are translated using the exchangerates at the date of the transaction (not retranslated). Non-monetary items measuredat fair value are translated using the exchange rates at the date when fair value wasdetermined.In the Group’s financial statements, all assets, liabilities and transactions of Groupentities with a functional currency other than sterling (the Group’s presentationcurrency) are translated into sterling upon consolidation. The functional currency of theentities in the Group have remained unchanged during the reporting period.On consolidation, assets and liabilities of foreign operations have been translated intosterling at the closing rate at the reporting date. Income and expenses have beentranslated into the Group’s presentation currency at the average rate over the reportingperiod. Exchange differences are charged/credited to comprehensive income andrecognised in the currency translation reserve in equity. On disposal of a foreignoperation, the cumulative translation differences recognised in equity are reclassified toprofit or loss and recognised as part of the gain or loss on disposal. Goodwill and fairvalue adjustments arising on the acquisition of a foreign entity have been treated asassets and liabilities of the foreign entity and translated into sterling at the closing rate.1.9 TaxationThe charge for taxation is based on the profits for the year and takes into accounttaxation deferred because of temporary differences between the treatment of certainitems for taxation and for accounting purposes.Temporary differences arise from the inclusion of profits and losses in the accounts indifferent periods from which they are recognised in tax assessments and primarily ariseas a result of the difference between tax allowances on property, plant & equipment andthe corresponding depreciation charge. Full provision is made for the tax effects of thesedifferences using tax rates substantively enacted at the balance sheet date.No provision is made for unremitted earnings of foreign subsidiaries where there is nocommitment to remit such earnings. Similarly, no provision is made for temporarydifferences relating to investments in subsidiaries since realisation of such differencescan be controlled and is not probable in the foreseeable future. Deferred tax assets arerecognised to the extent that it is probable that future taxable profit will be availableagainst which the temporary differences can be utilised.1.10 Property, plant & equipmentProperty, plant and equipment is stated at historical cost less depreciation. The Group’spolicy is to write off the difference between the cost of all property, plant and equipmentand their residual value on a straight line basis over their estimated useful lives asfollows:Office equipmentComputer equipmentLeasehold improvement3 years3 years10 yearsReviews are made annually of the estimated remaining lives and residual values ofindividual productive assets, taking account of commercial and technologicalobsolescence as well as normal wear and tear, and adjustments are made whereappropriate. All individual assets are reviewed for impairment when there areindications that the carrying value may not be recoverable.Page 19