PA Group Annual Report 2007
ACCOUNTING POLICIES
BASIS OF ACCOUNTING between profits computed for tax over the group’s share of the net assets
The financial statements have been purposes and profits stated in the attributed to the holding is capitalised
prepared on a going concern basis, financial statements to the extent that as goodwill and amortised over its
under the historical cost convention, there is an obligation to pay more tax, useful economic life.
and in accordance with the Companies or a right to pay less tax, in the future
Act and applicable United Kingdom as a result of the reversal of those b) Associates
accounting standards. A summary of timing differences. Deferred tax assets Associated undertakings comprise
the more important group accounting are recognised to the extent that investments in undertakings where the
policies is set out below. they are expected to be recoverable. group has a shareholding of between
Deferred tax is not discounted. 20% and 50% and has significant
BASIS OF CONSOLIDATION influence over the commercial and
The group financial statements are a TANGIBLE FIXED ASSETS financial policy of the entity. The group
consolidation of the audited financial Tangible fixed assets are stated at share of the result of its investment
statements of the company and its cost of acquisition less accumulated in an associated undertaking is
subsidiaries, the principal ones of depreciation. included in the consolidated profit
which are listed in note 13. No profit Depreciation of fixed assets is and loss account. In the consolidated
and loss account is presented for provided, from the date assets are balance sheet the investment in the
PA Group Limited as provided by acquired, on a straight-line basis associated undertaking is included
Section 230 of the Companies Act calculated to write off each asset as the group’s share of the net assets
1985. All acquisitions are accounted for over the term of its useful life, at the of the associated undertaking at the
using acquisition accounting rules. The following rates: year-end. The excess of the cost of the
results of acquisitions are included in investment over the group’s share of the
the consolidated profit and loss account Freehold property 2% net assets attributed to the holding is
from the day on which the subsidiary, Long leasehold property 5% - 10% capitalised as goodwill and amortised
joint venture, or associate is acquired. Computers and other over its useful economic life.
office equipment 14% - 50%
TURNOVER c) Subsidiary undertakings
Turnover comprises the net amount Freehold land is not depreciated. In the company balance sheet,
receivable in respect of the sale of investments in subsidiaries are carried
news, other information and new media INVESTMENTS at cost and are subject to impairment
services. Revenue is recognised as a) Joint ventures testing upon indication that the carrying
services are provided to customers. Joint ventures comprise investments in amount may not be recoverable.
undertakings where the group holds an
INTEREST interest on a long-term basis and jointly
Interest is recognised in the profit and controls the commercial and financial
loss account on an accruals basis. policy of the venture with one or more
other ventures under a contractual
TAX arrangement. The group share of the
The charge for tax is based on the result of its investment in joint ventures
profit for the year and takes into is included in the consolidated profit
account tax deferred or accelerated and loss account. In the consolidated
because of timing differences between balance sheet the investment in the
the treatment of certain items for joint ventures is included as the group
accounting and tax purposes. Full share of the net assets of the venture
provision is made for deferred tax at the year-end. On acquisition, the
resulting from timing differences excess of the cost of the investment
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