REPORT OF THE DIRECTORS AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
FOR
EASY IP LTD
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EASY IP LTD
CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
Page
Company Information 1
Report of the Directors 2
Report of the Auditors 3
Profit and Loss Account 4
Balance Sheet 5
Notes to the Financial Statements 6
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EASY IP LTD
COMPANY INFORMATION
FOR THE YEAR ENDED 31ST MARCH 1999
DIRECTORS: I S Reay
R I Hay
SECRETARY: R I Hay
REGISTERED OFFICE: Britannia House
British Fields
Ollerton Rd
Newark
NG22 OPQ
REGISTERED NUMBER: 3069875 (England and Wales)
AUDITORS: Bland & Co
Chartered Accountants
Registered Auditors
70 Balby Road
Doncaster
South Yorkshire
DN4 0JL
BANKERS: National Westminster Bank PLC
21 The Square
Retford
Nottinghamshire
DN22 6LB
Page 1
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EASY IP LTD
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31ST MARCH 1999
The directors present their report with the financial statements of the company
for the year ended 31st March 1999.
PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of
reselling and distribution of specialised computer software.
EVENTS SINCE THE END OF THE YEAR
Information relating to events since the end of the year is given in the notes
to the financial statements.
DIRECTOR
I S Reay was the sole director during the year under review.
His beneficial interest in the issued share capital of the company was as
follows:
31.3.99 1.4.98
Ordinary Shares 1 shares 2,750 2,750
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In preparing
those financial statements, the directors are required to
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it
is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets of
the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, Bland & Co, will be proposed for re-appointment in accordance with
Section 385A of the Companies Act 1985.
This report has been prepared in accordance with the special provisions of Part
VII of the Companies Act 1985 relating to small companies.
ON BEHALF OF THE BOARD:
R I Hay - DIRECTOR
Dated: 27th July 1999
Page 2
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EASY IP LTD
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF
EASY IP LTD
We have audited the financial statements on pages four to nine which have been
prepared in accordance with the Financial Reporting Standard for Smaller
Entities (effective March 1999), under the historical cost convention and the
accounting policies set out on page six.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described on page two the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
BASIS OF OPINION
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements. It
also includes an assessment of the significant estimates and judgements made by
the directors in the preparation of the financial statements, and of whether the
accounting policies are appropriate to the company's circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
OPINION
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at 31st March 1999 and of its profit for the year
then ended and have been properly prepared in accordance with the Companies Act
1985.
Bland & Co
Chartered Accountants
Registered Auditors
70 Balby Road
Doncaster
South Yorkshire
DN4 0JL Dated: 30th July 1999
Page 3
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EASY IP LTD
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31ST MARCH 1999
1999 1998
--------------------- ---------------------
Notes (pound) (pound) (pound) (pound)
TURNOVER 2 1,342,756 877,915
Cost of sales 1,033,125 571,010
----------- -----------
GROSS PROFIT 309,631 306,905
Administrative expenses 223,982 205,947
----------- -----------
OPERATING PROFIT 3 85,649 100,958
Income from investments - 500
Interest receivable and 33 -
similar income
----------- -----------
85,682 101,458
Interest payable and
similar charges 3,002 7,859
----------- -----------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 82,680 93,599
Tax on profit on ordinary
activities 4 17,759 17,153
----------- -----------
PROFIT FOR THE FINANCIAL YEAR
AFTER TAXATION 64,921 76,446
Dividends 5 - 16,000
----------- -----------
64,921 60,446
Retained profit/(deficit) brought forward 41,516 (18,930)
----------- -----------
RETAINED PROFIT CARRIED FORWARD (pound)106,437 (pound)41,516
=========== ===========
The notes form part of these financial statements
Page 4
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EASY IP LTD
BALANCE SHEET
31ST MARCH 1999
1999 1998
-------------------- --------------------
Notes (pound) (pound) (pound) (pound)
FIXED ASSETS:
Tangible assets 6 4,581 2,400
CURRENT ASSETS:
Stocks 91,266 57,500
Debtors 7 360,248 202,707
Cash at bank and in hand 81,066 9,447
--------- ---------
532,580 269,654
CREDITORS: Amounts falling
due within one year 8 425,724 225,538
--------- ---------
NET CURRENT ASSETS: 106,856 44,116
--------- ---------
TOTAL ASSETS LESS CURRENT
LIABILITIES: (pound)111,437 (pound)46,516
========= =========
CAPITAL AND RESERVES:
Called up share capital 11 5,000 5,000
Profit and loss account 106,437 41,516
--------- ---------
Shareholders' funds (pound)111,437 (pound)46,516
========= =========
These financial statements have been prepared in accordance with the special
provisions of Part VII of the Companies Act 1985 relating to small companies and
with the Financial Reporting Standard for Smaller Entities (effective March
1999).
ON BEHALF OF THE BOARD:
I S Reay - DIRECTOR
Approved by the Board on 27th July 1999
The notes form part of these financial statements
Page 5
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EASY IP LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
1. ACCOUNTING POLICIES
Accounting convention
The financial statements have been prepared under the historical cost
convention and in accordance with the Financial Reporting Standard for
Smaller Entities (effective March 1999).
Turnover
Turnover represents net invoiced sales of goods, excluding value added tax.
Tangible fixed assets
Depreciation is provided at the following annual rates in order to write
off each asset over its estimated useful life.
Plant and machinery etc - 25% on cost
Stocks
Stock is valued at the lower of cost and net realisable value, after making
due allowance for obsolete and slow moving items.
Deferred taxation
Provision is made at current rates for taxation deferred in respect of all
material timing differences except to the extent that, in the opinion of
the directors, there is reasonable probability that the liability will not
arise in the foreseeable future.
Hire purchase and leasing commitments
Rentals paid under operating leases are charged to the profit and loss
account as incurred.
Pensions
The company operates a defined contribution pension scheme. Contributions
payable for the year are charged in the profit and loss account.
2. TURNOVER
In the opinion of the director, 0.5% of the turnover of the company is
attributable to geograpgical markets outside the U.K. (1998; 1%)
Page 6
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EASY IP LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
3. OPERATING PROFIT
The operating profit is stated after charging:
1999 1998
(pound) (pound)
Depreciation - owned assets 2,534 1,355
Auditors' remuneration 2,650 2,050
Pension costs 9,542 601
======== ========
Director's emoluments and other benefits etc 52,335 43,457
======== ========
The number of directors to whom retirement benefits were accruing was as
follows:
Money purchase schemes 1 -
======== ========
4. TAXATION
The tax charge on the profit on ordinary activities for the year was as
follows:
1999 1998
(pound) (pound)
UK corporation tax 17,759 17,153
======== ========
UK corporation tax has been charged at 21% (1998 - 21%).
5. DIVIDENDS
1999 1998
(pound) (pound)
Equity - ordinary/interim - 16,000
======== ========
Page 7
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EASY IP LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
6. TANGIBLE FIXED ASSETS
Plant and
machinery
etc
----------
(pound)
COST:
At 1st April 1998 5,417
Additions 4,715
----------
At 31st March 1999 10,132
----------
DEPRECIATION:
At 1st April 1998 3,017
Charge for year 2,534
----------
At 31st March 1999 5,551
----------
NET BOOK VALUE:
At 31st March 1999 4,581
==========
At 31st March 1998 2,400
==========
7. DEBTORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
1999 1998
(pound) (pound)
Trade debtors 356,767 198,714
Other debtors 135 -
Prepayments 3,346 3,305
ACT - 688
--------- ---------
360,248 202,707
========= =========
8. CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
1999 1998
(pound) (pound)
Trade creditors 321,097 138,077
Other creditors 23,157 58,904
V.A.T. 49,755 3,270
PAYE and NI 6,366 4,937
Corporation tax 17,759 17,153
Accrued expenses 7,590 3,197
--------- ---------
425,724 225,538
========= =========
Page 8
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EASY IP LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31ST MARCH 1999
9. OPERATING LEASE COMMITMENTS
The following payments are committed to be paid within one year:
1999 1998
(pound) (pound)
Expiring:
Within one year 10,236 6,500
Between one and five years 7,203 9,246
-------- --------
17,439 15,746
======== ========
10. SECURED DEBTS
Included in other creditors is an amount of (pound)23,157, being a
factoring advance, which is secured by a charge over Trade Debtors in the
amount of (pound)160,251.
11. CALLED UP SHARE CAPITAL
Authorised, allotted, issued and fully paid:
Nominal 1999 1998
Number: Class: value: (pound) (pound)
5,000 Ordinary Shares 1 5,000 5,000
======== ========
12. RELATED PARTY DISCLOSURES
I.S. Reay is also a director and shareholder of Independent Computer
Brokers Associates Limited. During the year the company sold goods
amounting to(pound)58,936 to ICBA Ltd. and contributed(pound)8,867 towards
their administration costs. At 31st March 1999, ICBA Ltd. owed the company
an amount of(pound)15,372 which is included in Trade Debtors. All
transactions between the two companies were at arms length.
13. POST BALANCE SHEET EVENTS
On the 19th April 1999 Eurotelecom Corporation Limited, acquired the issued
share capital of the company. Easy IP Limited became a wholly owned
subsidiary with Eurotelecom Corporation Limited as the ultimate holding
company.
14. SUMMARY OF DIFFERENCES BETWEEN THE FINANCIAL INFORMATION AND US GAAP
The financial information set out above has been prepared in accordance
with UK GAAP, and on the basis of presentation set out in note 1, which do
not differ in any material respects from US GAAP.
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