REG - Assoc British Enging - Annual Financial Report <Origin Href="QuoteRef">ASBE.L</Origin> - Part 3
29/07/2015 07:00
- Part 3: For the preceding part double click ID:nRSc3684Ub
£'000 £'000
The tax charge is set out below:
Current tax:
United Kingdom corporation tax at 21% (2014: 23%) - -
Deferred tax:
In respect of current year (6) 12
-------- ---------
Total current tax and tax on profit on ordinary activities (6) 12
==== =====
The tax assessed for the period is different from the standard rate of corporation tax in the UK of 21% (2014: 23%). The
differences are explained as follows:
2015 2014
£'000 £'000
Loss on ordinary activities before tax (179) (328)
---------------- ----------------
Loss on ordinary activities multiplied by standard rate of
Corporation tax in the UK of 21% (2014: 23%) (38) (75)
Effects of:
Expenses not deductible for tax purposes 4 7
Income not taxable (35) (33)
Tax losses and advance corporation tax relief (ACT) - (3)
Depreciation for the period in excess of capital allowances (4) 7
Adjustment to recognised deferred tax (6) 12
Unrelieved tax losses 73 97
---------------- ----------------
Taxation expense in the consolidated income statement (6) 12
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The Group has trading losses of approximately £1.64 million (2014: £1.5 million) and capital losses of £8.5 million (2014:
£8.5 million). These are available to set against future taxable profits, taxation liabilities and capital gains
respectively. The trading losses are available to be used against future profits arising from the same trade within the
Group. These amounts are subject to agreement with Her Majesty's Revenue and Customs. Deferred tax assets have not been
recognised in the Group accounts. As the timing and extent of taxable profits are uncertain, a deferred tax asset of
£661,000 arising on the trading losses has not been recognised in the financial statements.
9. LOSS PER SHARE
The calculation of loss per ordinary share is based on the loss attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year.
2015 2014
Weighted Weighted
Average Per shares Average Per shares
Loss number of amount Loss Number of amount
£'000 Shares pence £'000 Shares Pence
Basic and diluted earnings per share (153) 2,048,990 (7.5p) (99) 2,048,990 (4p)
========= ========= ========= ========= ========= =========
.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
10. PROPERTY, PLANT AND EQUIPMENT Freehold
land and Plant and
buildings machinery Total
£'000 £'000 £'000
COST
At 1 April 2013 689 1,552 2,241
Additions - 37 37
Disposals - (180) (180)
---------------- ------------------- -------------------
At 31 March 2014 689 1,409 2,098
---------------- ------------------- -------------------
At 1 April 2014 689 1,409 2,098
Additions - 10 10
Disposals - (9) (9)
---------------- ------------------- -------------------
At 31 March 2015 689 1,410 2,099
---------------- ------------------- -------------------
ACCUMULATED DEPRECIATION
At 1 April 2013 689 1,172 1,861
Charge for year - 53 53
Eliminated on disposals - (180) (180)
---------------- ------------------- -------------------
At 31 March 2014 689 1,045 1,734
---------------- ------------------- -------------------
At 1 April 2014 689 1,045 1,734
Charge for year - 53 53
Eliminated on disposals - (9) (9)
---------------- ------------------- -------------------
At 31 March 2015 689 1,089 1,778
---------------- ------------------- -------------------
CARRYING AMOUNTS
At 31 March 2015 - 321 321
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At 31 March 2014 - 364 364
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At 31 March 2013 - 380 380
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11. CAPITAL COMMITMENTS
11.
CAPITAL COMMITMENTS
At 31 March 2015 the Group had capital commitments of £Nil (2014: £Nil).
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
12. INVENTORIES 2015 2014
£'000 £'000
Raw materials 94 107
Work in progress 81 117
Finished goods 764 828
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939 1,052
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======
======
The closing inventory balance of £3,369,000 (2014: £3,371,000) is stated net of provisions of £2,430,000 (2014:
£2,219,000). There was an increase in provision of £211,000 (2014: £74,000 increase) in relation to slow moving stock.
13. TRADE AND OTHER RECEIVABLES 2015 2014
£'000 £'000
Trade receivables 420 469
Allowance for doubtful debts (86) (79)
----------- -----------
334 390
Prepayments and accrued income 269 137
----------- -----------
603 527
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ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
13. TRADE AND OTHER RECEIVABLES (CONTINUED)
TRADE AND OTHER RECEIVABLES (CONTINUED)
Trade receivables disclosed above are classified as loans and receivables and are measured at amortised cost.
The average credit period offered on sales of goods varies from 30 days to 90 days. The Group has recognised an allowance
for doubtful debts based on estimated irrecoverable amounts determined by reference to past default experience of the
counterparty and an analysis of the counterparty's current financial position.
Trade receivables disclosed above include amounts (see below for aged analysis) which are past due at the year-end but
against which the Group has not recognised an allowance for doubtful receivables. There has not been a significant change
in credit quality and the amounts are still considered recoverable.
Ageing of past due but not impaired receivables:
2015 2014
£'000 £'000
31 - 60 days 18 105
61 - 90 days 2 34
91 - 120 days 279 100
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299 239
===== =====
=====
=====
Movement in the allowance for doubtful debts:
2015 2014
£'000 £'000
Balance at the beginning of the period 79 32
Increase in provision 7 47
----------- -----------
Balance at the end of the period 86 79
===== =====
=====
=====
In determining the recoverability of a trade receivable the Group considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the reporting date. The Group has a concentration of credit
risk with exposure to one large debtor balance at the year-end which accounts for 51% of the balance due between 91 - 120
days. Management considers that all the above financial assets that are not impaired or past due are of good credit
quality.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
14. AVAILABLE FOR SALE INVESTMENTS 2015 2014
£'000 £'000
Listed Securities 417 129
==== ===
Available For Sale
financial assets
£
Opening balance 129
Additions 220
Net fair value gain 74
Disposals (6)
----------
Closing balance 417
=====
Gains or losses on available for sale investments are presented within other comprehensive income.
IFRS 13 requires that the fair value reflects "exit price" and is valued in line with the relevant "unit of account" and
the fair value of the equity investments held is calculated by reference to the quoted market price at the year end.
Available for sale investments, which are valued based on active markets' prices, are reported under Level 1 in the fair
value hierarchy.
Reclassification of financial assets held for trading to available for sale financial assets
The investments in securities were previously classified as held for trading in the financial statements. The directors
have considered the nature of the investment portfolio in the context of IAS 39 and have determined that it is more
appropriate to classify the investment portfolio as assets available for sale rather than held for trading. Therefore the
financial assets of £129,000 as at 31 March 2014 have been reclassified on the balance sheet as available for sale.
As a consequence of this change future gains and losses on the investment portfolio will pass through other comprehensive
income rather than the profit and loss and be recorded in an Available for Sale Reserve. In the year to 31 March 2015, an
unrealised gain of £75,000 has been recognised within other comprehensive income, of which an £84,000 gain relates to the
investment addition in the year, and a £10,000 loss relates to the investments previously classified as held for trading.
The impact of this change on the prior year results was £39,000 which is not considered to be material and so no
restatement of the prior year profit and loss account and statement of comprehensive income has been made. In the year
ended 31 March 2015 £14,000 has been transferred from retained earnings to a separate Available for Sale reserve to reflect
this change. This change has no impact on reported net assets.
15. CALLED UP SHARE CAPITAL 2015 2014
£'000 £'000
Nominal value:
Allotted and fully paid:
2,048,990 ordinary shares of £0.025 each 51 51
1,313,427 deferred shares of £1.975 each 2,594 2,594
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2,645 2,645
====== ======
Carrying value:
Equity shares:
2,048,990 ordinary shares of £0.025 each 51 51
====== ======
The structure of the Group and Company's capital is as follows:
Number of Number of
Ordinary Ordinary Deferred Deferred Share
Shares Shares Shares Shares premium
No. £'000 No. £'000 £'000
Balance at 1 April 2014 (£0.025/£1.9752 shares) 2,048,990 51 1,313,427 2,594 5,370
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
15. CALLED UP SHARE CAPITAL (Continued)
CALLED UP SHARE CAPITAL (Continued)
Further to the Extraordinary General Meeting held on 1 September 1999 the ordinary shares have 200 votes per share.
The deferred shares do not have voting rights and do not carry any entitlement to attend general meetings of the Company;
they are not admitted to any Stock Exchange and carry a right to participate in any return of capital once an amount of
£100 has been paid in respect of each new ordinary share.
16. NON-CONTROLLING INTERESTS
Movement in non-controlling interests during the year are disclosed in the statement of changes in equity.
An increase in non-controlling interest of £32,000 was recognised during the year in respect of the acquisition of an additional 26.8% stake in Akoris Trading Limited ("Akoris"), bringing the total holding in Akoris at the year-end to 76.8%.
2015
£'000
Brought forward as at 1 April 2014 59
Arising on purchase of additional shares from non-controlling interest * (33)
Share of result for the year (32)
-------------
Carried forward at 31 March 2015 (6)
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======
* The additional shares were acquired for £1.
17. RETIREMENT BENEFIT SCHEMES
The Group operated a defined benefit pension scheme, holding the assets in a separate trustee administered fund ("the ABE
Pension Fund"). The required contributions were assessed with the advice of an independent qualified actuary using the
projected unit credit method. The Group also has a designated defined benefit Group personal pension plan which meets
stakeholder requirements.
The scheme exposes the Group to actuarial risks such as:
Salary risk:
The present value of the plan liability is calculated by reference to the future salaries of participating members. Any
increase in members' salaries will increase the scheme's liability.
Interest rate risk:
Any decrease in bond rates will increase the scheme's liability.
Investment risk:
If the return on scheme assets is below the discount rate used to calculate the present value of the scheme liability it
may lead to a scheme deficit.
Longevity risk:
Any increase in life expectancy of the scheme's members will increase the scheme's liability as the present value of the
scheme's liability is calculated by reference to the best estimate of the mortality rate of the scheme's members.
The scheme consists of 3 active members, 34 deferred members and 56 pensioner members. The expected contribution to the
scheme for the forthcoming year is expected to be £158,000.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
17. RETIREMENT BENEFIT SCHEMES (Continued)
The value placed on the benefit obligation is particularly sensitive to changes in some of the key assumptions. Two of the
most critical are:
· The real (i.e. net of inflation) and nominal rates of interest used; and
· Changes in future mortality rates
Set out below is a table highlighting the impact on the results of changing these assumptions.
There would be a similar, but opposite effect if the discount rate was to be increased, the inflation rate was decreased
and members assumed to live one year or less.
Assumption Change in the Defined Benefit Obligation % Change in the Defined Benefit Obligation (£'000)
0.25% p.a. reduction in discount rate +4.0 75
0.25% increase in inflation +1.7 32
Members assumed to live one year longer +3.7 70
In the year ended 31 March 2009, the Company came to an agreement with the Trustees of the scheme and a resolution was
approved whereby the Group is no longer liable for its previously recognised retirement obligations for the ABE section of
the fund. The elimination of the ABE section resulted in an elimination of £3,047,000 of the opening obligation which was
reflected through the Statement of Comprehensive Income. The remaining obligation relates to the BPE section of the scheme
and is summarised on the following page.
Contributions by employer in respect of future accrual of benefits, death in service benefits and expenses:
28.6% (2014:28.6%) of pensionable salaries less member contributions, payable monthly by the 19th of the calendar month
after that to which they relate. In addition, the employer will pay amounts into the scheme equal to the levy payments made
by the scheme to the Pension Protection Fund. Such amounts will be paid by the employer within a year of them being paid by
the scheme. Insurance premiums for death in service benefits, management and administration expenses are payable in
addition as and when they are due.
Contributions by employer in respect of the shortfall in funding following the triennial review:
With reference to the recovery plan agreed with the Trustees in conjunction with the valuation as at 1 April 2014, the
employer will make the following contributions over the period from 1 April 2014 to 31 March 2030:
· From 1 April 2014 until 1 August 2014 contributions of £17,000 per month has been paid in accordance with the
previous recovery plan.
· From 1 August 2014, £10,000 per month are payable by the 19th of the calendar month after that to which they
relate.
· An additional lump sum relating to the profits of the employer in respect of all accounting periods as from 1 April
2014 is payable in the financial year following the generation of the profits calculated on the following basis:-
· a) for all trading profits (before interest and taxation, and excluding those generated from external investments)
in excess of £250k and below £1,050k an additional payment of 20% of such profits;
· b) for all trading profits (before interest and taxation, and excluding those generated from external investments)
in excess of £1,050k an additional payment of 10% of such profits;
· Profit-share contributions will only be payable if there is a gross pension deficit recorded in the Employer's
Annual Report and Accounts for the financial year in which the profits are generated;
· Funding shortfall contributions (including profit-share contributions) will cease in the event that a funding
surplus is certified by the Scheme Actuary
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
17. RETIREMENT BENEFIT SCHEMES (CONTINUED)
2015 2014
£'000 £'000
(a) Pension cost (recognised in Income Statement)
Operating charge
Current service cost 25 28
-------------- --------------
Other finance charges
Interest on net defined benefit obligation 62 40
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Total pension cost recognised in the Income Statement 87 68
======= =======
(b) Benefit liability 2015 2014 2013 2012 2011
£'000 £'000 £'000 £'000 £'000
Present value of funded obligations 8,424 7,101 6,748 6,451 6,577
Fair value of plan assets (6,532) (5,687) (5,817) (5,476) (4,725)
--------------- --------------- --------------- --------------- ---------------
Net liability 1,892 1,414 931 975 1,852
======= ======= ======= ======= =======
The major categories of plan assets are as follows:
2015 2014
£'000 £'000
Equities (quoted) 1,502 847
Fixed Interest Gilts 1,069 340
Index-Linked Gilts 1,907 1,498
Corporate Bonds 1,075 2,929
Cash 923 -
Bank Balance 56 73
-------------- --------------
6,532 5,687
======= =======
Plan assets
The weighted-average asset allocations at the year-end were as follows: 2015 2014
Equities (quoted) 23.0% 14.9%
Bonds 62.0% 83.8%
Cash 15.0% 1.3%
1.3%
Plan risks
The defined benefit plan typically expose the Company to actuarial risks, as stated on page 34, which are managed by a
joint working group, comprising the Trustees of the defined benefit plan and employees of the Company.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
17. RETIREMENT BENEFIT SCHEMES (continued)
RETIREMENT BENEFIT SCHEMES (continued)
(c) Change in benefit obligation 2015 2014
£'000 £'000
Benefit obligation at beginning of the year 7,101 6,748
Current service cost 25 28
Interest cost 327 303
Actuarial losses arising from changes in financial assumptions 1,235 393
Contributions by plan participants 6 5
Benefits paid (270) (376)
--------------- ---------------
Benefit obligation at end of the year 8,424 7,101
======= =======
2015 2014
£'000 £'000
(d) Change in plan assets
Fair value of plan assets at beginning of the year 5,687 5,817
Expected return on plan assets 265 263
Actuarial gains/(loss) on plan assets arising from changes in financial assumptions 669 (187)
Contributions made by employer 175 165
Contributions by plan participants 6 5
Benefits paid (270) (376)
--------------- ---------------
Fair value of plan assets at end of the year 6,532 5,687
======= =======
Fair value of plan assets at end of the year
6,532
5,687
=======
=======
The expected long term return on cash is determined by reference to current and expected long-term bank base rates. The
expected return on bonds is determined by reference to United Kingdom long dated gilt and bond yields at the balance sheet
date. The expected rate of return on equities have been determined by setting an appropriate risk premium above gilt/bond
yields having regard to market conditions at the balance sheet date. The expected rates have then all been reduced to
reflect the level of anticipated future expenses.
The expected long term rate of return under IAS 19 (revised in 2011) is the same as the discount rate of 3.4% pa (2014:
4.7% p.a.).
(e) Principal actuarial assumptions 2015 2014
Inflation 1.8 2.1
Rate of increase in pensionable salaries 2.5 2.5
Discount rate 3.4 4.7
Pension in payment increases 1.8 2.1
Revaluation rate for deferred pensioners 1.8 2.1
Pre-retirement mortality PNMAOO, MC 1%PNFAOO, MC 1% PNMAOO, MC 1%PNFAOO, MC 1%
Post retirement mortality PNMAOO, MC 1% PNMAOO, MC 1%
PNFAOO, MC 1% PNFAOO, MC 1%
Life expectancy from age 65 (years):
Male currently aged 65 22.9 22.8
Female currently aged 65 25.4 25.3
Male currently aged 45 24.9 24.7
Female currently aged 45 27.2 27.1
24.9
24.7
Female currently aged 45
27.2
27.1
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
17. RETIREMENT BENEFIT SCHEMES (CONTINUED)
(f) Expected future cash flows
The Group's expected contribution to its defined benefit plans in 2015 is expected to be £158,000. The Group does not
expect any material changes to the annual cash contributions over the next three years given the funding position of the
scheme. The defined benefit obligations are based on the current value of expected benefit payment cash flows to members
over the next several decades.
The overall weighted average duration of scheme liabilities as at 31 March 2015 is approximately 19 years
18. PAYABLES 2015 2014
£'000 £'000
Current
Obligations under finance leases 65 65
Trade payables 283 174
Other taxation and social security 23 39
Other payables 300 24
Accruals 26 316
----------------- -----------------
697 618
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The net finance lease obligations are due:
In one year or less 65 65
Between two and three years 107 172
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172 237
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========
All current payables apart from obligations under finance leases are expected to mature within a period of 6 months.
19. FINANCIAL INSTRUMENTS
The fair values of cash and cash equivalents, available for sale financial assets, receivables and payables are assumed to
approximate to their carrying values.
The Group's financial instruments comprise cash and various items, such as trade and other receivables, available for sale
financial assets and trade and other payables that arise directly from its operations. The main purpose of these financial
instruments is to finance the Group's operations. At 31 March 2015 the Group has cash balances of £2,606,000 (2014:
£2,992,000) and no bank overdraft (2014: £Nil).
RISKS
The main risks arising from the Group's financial instruments are market risk, liquidity risk and credit risk. Market risk
includes price commodity risk, foreign exchange risk and interest rate risk. The Group has limited exposure to foreign
exchange risk and also has no loans, therefore limited exposure to interest rate risk.
Cash and cash equivalents held at floating rates expose the entity to cash flow risk. Interest rate risk is limited to the
cash and cash equivalents.
Based on the balance sheet value of cash and cash equivalents, a 1% change in interest base rates would lead to an increase
or decrease in income and equity of £26,000 (2014: £30,000).
The Board reviews and agrees policies for managing each of the above risks and they are summarised overleaf and in the
accounting policies to the Group financial statements. These policies have been consistently applied throughout the
period.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
19. FINANCIAL INSTRUMENTS (continued)
COMMODITY PRICE RISK
The Group is dependent upon its suppliers to effectively operate a 'just in time' stock management system, which is
utilised to mitigate high warehousing costs. There is the potential to leave the Group exposed to 'stock out' or shortages
but the Group has not experienced stock difficulties of this nature in the current or prior year and does not envisage this
going forward, due to its strong supplier relations.
When prices are advantageous a strategic decision may be taken to increase a stock level which mitigates the issue of price
commodity risk. There are a number of suppliers used, each with various contractual terms, and therefore the Board do not
consider this a significant risk.
The price of aluminium which the Group trades in is dependent on the activities of the competitors, speculators, exchange
rate movements and production costs. Akoris do not utilise derivative contracts to hedge fluctuations on aluminium.
LIQUIDITY RISK
The Group's liquidity is dependent on the cash balances available and it is the Group's policy to place surplus cash on
deposit to ensure as high a rate of return as possible. The Board reviews an annual 12 month financial projection as well
as information regarding cash balances on a monthly basis.. The maturity profile of the Group's finance lease liabilities
is set out in note 18.
CREDIT RISK
The Group's principal financial assets are cash deposits, available for sale financial assets and trade and other
receivables. The credit risk associated with the cash is limited as the counterparties have high credit ratings assigned
by international credit-rating agencies. The principal credit risk arises therefore from its trade and other receivables.
In order to manage credit risk the directors of the subsidiary company set limits for customers based on a combination of
payment history and third party credit references. Credit limits are reviewed by the subsidiary's directors on a regular
basis in conjunction with debt ageing and collection history. In 2015 and 2014 there were no concentrations of credit
risk. The Group's top five customers comprised 17% of the year end trade receivables. The Board consider their strong
customer relations to be a strength rather than a risk as they are the preferred suppliers to these customers.
Where appropriate, the subsidiary company requests payment or part-payment in advance of shipment which generally covers
the cost of the goods. In connection with the trade receivables, there is a risk of warranty claims, which the subsidiary
company tries to minimise. The carrying value of the trade receivables represents the maximum credit risk exposure and
therefore sensitivity analysis has not been performed.
Collection procedures in relation to receivables are initiated once the credit terms are exceeded and trade receivables
both due and not yet due are reviewed on a line by line basis, with adequate provision being made against period end
balances where appropriate. During the year an additional provision of £5,000 has been included in the financial
statements.
At the year end 72% of current financial assets are aged greater than 90 days. These amounted to £344,000 and £81,000 have
been provided for.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at
fair value into Levels 1 to 3 based on the degree to which the fair value is observable:
· Level 1 fair value measurements are those derived from quoted prices in active markets for identical assets or
liabilities;
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
19. FINANCIAL INSTRUMENTS (continued)
· Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that
are observable for the asset or liability, either directly (i.e as prices) or indirectly (i.e derived from prices); and
· Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or
liability that are not based on observable market data (unobservable inputs).
Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Available for sale financial assets
Quoted securities 417 - - 417
====== ====== ====== ======
======
20. DEFERRED TAXATION
The deferred taxation liability at 31 March 2015 was £8,000 (31 March 2014: £2,000).
No provision has been made for the potential deferred tax assets on the trading losses carried forward as they are not
sufficiently certain to crystallise in the foreseeable future, with future pension obligations deemed to exceed the
potential future cash inflows. This assumption will be revisited on an annual basis or as and when circumstances change.
The amounts not recognised (all of which have been calculated at 20% (2014: 20%)) are set out below:
Group 2015 2014
£'000 £'000
Arising from trading losses 298 273
Arising from capital losses 1,700 1,700
Arising from pension deficit 378 283
------------- -------------
2,376 2,256
====== ======
21. CONTINGENT LIABILITIES
2015 2014
£'000 £'000
a) Banker's indemnities 30 30
==== ====
====
The indemnities relate to provision of services such as letters of credit or international guarantees by the bank.
b) There were no other contingent liabilities at 31 March 2015 or 31 March 2014.
22. COMMITMENTS UNDER OPERATING LEASES
At 31 March the Group had the following commitments under non-cancellable operating leases:
Other
2015 2014
£'000 £'000
Within one year 8 13
Between two and five years inclusive - 17
------------- -------------
8 30
====== ======
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 31 MARCH 2015
23. SUBSIDIARIES
At 31 March 2015 the Company held share capital in the following subsidiaries:
Share Capital Proportion held by the parent Country of incorporation Nature of Business
British Polar Engines Limited Ordinary 100% (2014: 100%) Great Britain Manufacture and supply of diesel engines, associated servicing and sale of spare parts
Akoris Trading Limited Ordinary 76.8% (2014: 50%) Great Britain Commodity and natural resource trading, finance and investment.
The group controls 100% of the voting power of the subscribed shares and has control over the financial and operational
policies of Akoris Trading Limited. Therefore, Akoris Trading Limited is controlled by the group and consolidated in these
financial statements. Movement in non-controlling interests are disclosed in note 16 to the accounts.
24. RELATED PARTY TRANSACTIONS
At 31 March 2015 David Brown, a company director (resigned 11 December 2014), had a 12.4% (2014: 12.4%) interest in the
shares of Akoris Trading Limited.
At 31 March 2015, British Polar Engines had a 19.9% (2014: Nil) holding in 3 Legs Resources PLC. Colin Weinberg a director
of the company held 0.1% holding in 3 Legs Resources at 31 March 2015.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ASSOCIATED BRITISH ENGINEERING PLC
We have audited the parent company financial statements of Associated British Engineering Plc for the year ended 31 March
2015 which comprise the principal accounting policies, the company balance sheet, and the related notes. The financial
reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards
(United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies
Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required
to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this
report, or for the opinions we have formed.
Respective responsibilities of directors and auditor
As explained more fully in the Directors' Responsibilities Statement on page 50, the directors are responsible for the
preparation of the parent company financial statements and for being satisfied that they give a true and fair view. Our
responsibility is to audit and express an opinion on the parent company financial statements in accordance with applicable
law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing
Practices Board's Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the Financial Reporting Council's website at
www.frc.org.uk/auditscopeukprivate.
Opinion on financial statements
In our opinion the parent company financial statements:
§ give a true and fair view of the state of the company's affairs as at 31 March 2015 and of its loss for the year then
ended;
§ have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
§ have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion:
§ the part of the Directors' Remuneration Report to be audited has been properly prepared in accordance with the Companies
Act 2006; and
§ the information given in the Strategic Report and Directors' Report for the financial year for which the financial
statements are prepared is consistent with the parent company financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to
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