Invesco Prop Inc Annual Financial Report -5-

rate swaps 
 
Balance at 31 March      101,368       -       2,267 (208,202)  66,893 (37,674) 
2014 
 
The accompanying notes are an integral part of these financial statements. 
 
. 
 
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
AT 31 MARCH 2014 
 
                                                                 2014      2013 
                                                      NOTES     GBP'000     GBP'000 
 
Non-current assets 
 
Investment properties                                         108,221   191,028 
 
                                                              108,221   191,028 
 
Current assets 
 
Trade and other receivables                                     3,187     5,744 
 
Cash and cash equivalents                                      24,190    11,198 
 
                                                               27,377    16,942 
 
Assets classified as held for sale                             19,156         - 
 
Total assets                                                  154,754   191,028 
 
Current liabilities 
 
Trade and other payables                                     (13,001)  (14,058) 
 
Taxation                                                      (3,753)         - 
 
Interest rate swap liabilities                                (1,474)     (149) 
 
Currency rate swap liabilities                                (7,979)         - 
 
Obligations under finance lease                                 (461)     (458) 
 
Bank loan                                                   (150,777)         - 
 
                                                            (177,445)  (14,665) 
 
Total assets less current liabilities                        (22,691)   176,363 
 
Non-current liabilities 
 
Bank loan                                                           - (191,288) 
 
Other payables                                                (1,420)   (2,796) 
 
Interest rate swap liabilities                                      -   (4,521) 
 
Currency rate swap liabilities                                      -   (9,785) 
 
Obligations under finance leases                              (7,154)   (7,142) 
 
Deferred taxation                                             (6,409)  (12,761) 
 
                                                             (14,983) (228,293) 
 
Net liabilities                                              (37,674)  (34,988) 
 
Capital and reserves 
 
Stated capital                                            4   101,368   101,368 
 
Other reserve                                                       -   (4,670) 
 
Translation reserve                                             2,267     1,766 
 
Capital reserves                                            (208,202) (199,874) 
 
Revenue reserves                                               66,893    66,422 
 
Issued capital and reserves                                  (37,674)  (34,988) 
 
Net asset value per ordinary share                        5   (24.6)p   (22.9)p 
 
Approved by the Board of Directors on 27 November 2014. 
 
Richard Barnes 
Chairman 
 
The accompanying notes are an integral part of these financial statements. 
 
. 
 
CONSOLIDATED STATEMENT OF CASH FLOWS 
FOR THE YEAR ENDED 31 MARCH 2014 
 
                                                                  2014     2013 
                                                                 GBP'000    GBP'000 
 
Operating activities 
 
Rent and service charges received                               19,790   21,140 
 
Bank interest received                                               3        5 
 
Proceeds on swap disposal                                            -    (825) 
 
Bank loan interest paid                                        (8,357)  (8,656) 
 
Operating expense payments                                    (10,921) (11,423) 
 
Tax paid                                                         (134)    (128) 
 
Net cash from operating activities                                 381      113 
 
Investing activities 
 
Capital expenditures and incentives                            (1,080)  (1,473) 
 
Sale of investment properties                                   53,164        - 
 
Net cash from/(used in) investing activities                    52,084  (1,473) 
 
Financing activities 
 
Loan facility fee                                                (324)        - 
 
Repayment of loan                                             (39,172)  (1,597) 
 
Net cash used in financing activities                         (39,496)  (1,597) 
 
Increase/(decrease) in cash and cash equivalents                12,969  (2,957) 
 
Cash and cash equivalents at beginning of year                  11,198   14,004 
 
Effect of foreign exchange changes                                  23      151 
 
Cash and cash equivalents at end of year                        24,190   11,198 
 
. 
 
NOTES TO THE FINANCIAL STATEMENTS 
 
1. Accounting policies 
 
A summary of the principal accounting policies, all of which have been applied 
consistently throughout this and the previous year, is set out below. 
 
(a) Going Concern 
 
It was announced on 28 July 2014 that the Company would seek purchasers for all 
the Group's remaining property assets. Since that date the Company has agreed 
arrangements with its lenders for the extension of the loan facility to 31 
December 2014 and the marketing and proposed sale of investment properties, 
following which the Directors intend to begin the winding up of the Group 
companies. Given these proposals for the effective termination of the Company's 
business, the Directors do not consider it appropriate to treat the Company as 
a going concern and the accounts have been prepared on a basis other than that 
of a going concern. 
 
The financial statements do not include any provision for the future costs of 
winding up the group companies except to the extent that they were committed at 
the end of the reporting period. 
 
(b) Basis of Accounting 
 
The financial statements of the Group have been prepared in accordance with 
International Financial Reporting Standards (`IFRS') as adopted for use in the 
European Union, which comprise standards and interpretations approved by the 
International Accounting Standards Board (`IASB'), and International Accounting 
Standards and Standing Interpretations Committee interpretations approved by 
the International Accounting Standards Committee (`IASC') that remain in 
effect, and were subsequently endorsed by the European Union. 
 
The financial statements have been prepared on a basis other than that of a 
going concern. Where presentational guidance set out in the Statement of 
Recommended Practice (`SORP') for investment trusts issued by the Association 
of Investment Companies (`AIC') in January 2009 is consistent with the 
requirements of IFRS, the Directors have sought to prepare the financial 
statements on a basis compliant with the recommendations of the SORP. 
 
The preparation of the financial statements in conformity with IFRS requires 
management to make judgements, estimates and assumptions that affect the 
application of policies and the reported amounts of assets and liabilities, 
income and expenses. The estimates and associated assumptions are based on 
historical experience and various other factors that are believed to be 
reasonable under the circumstances, the results of which form the basis of 
making judgements about the carrying value of assets and liabilities that are 
not readily apparent from other sources. 
 
Actual results may differ from these estimates. The estimates and underlying 
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates 
are recognised in the period in which the estimate is revised if the revision 
only affects that period, or in the period of the revision and future periods 
if the revision affects both current and future periods. 
 
In applying the Group's accounting policies, the Directors make key judgements 
and assumptions; the key sources of estimation and uncertainty are in the 
following areas: 
 
Property valuations 
 
In determining the fair value of investment properties under IAS 40 at fair 
value, there is a degree of uncertainty and judgement involved. The Group uses 
external professional valuers to determine the relevant amounts. The valuers' 
opinion is that, with market conditions which currently prevail, there is 
likely to be a greater than usual degree of uncertainty in respect of 
valuations. Until the number and consistency of comparable transactions 
increase, this situation is likely to remain. 
 
The Directors and the company's external valuers have also given consideration 
to the valuations in light of the basis of preparation of the financial 
statements and the realisable values of individual assets at the reporting 
date. 
 
Classification of leases 
 
In determining whether leases and related properties represent operating or 
finance leases, consideration is given to whether the tenant or landlord bears 
the risks and rewards of ownership. 
 
Non-current assets held for sale 
 
A non-current asset is transferred to assets held for sale when it is expected 
that the carrying amount will be recovered principally through sale rather than 
continuing use. For this to be the case, the asset or disposal group must be 
available for immediate sale in its present condition subject only to terms 
that are usual and customary to sales of such property and its sale must be 
highly probable. The following criteria must be met for a highly probable sale: 
 
* Available for immediate sale in its present condition; 
 
* Management committed to a plan to sell; 
 
* Active program to locate the buyer and complete the plan must be initiated; 
 
* The property must be actively marketed for sale at a price that is reasonable 
in relation to its current fair value; 
 
* The sale should be expected to qualify for recognition as a completed; and 
 
* Sale within one year from the date of classification. 
 
Non-current assets and disposal groups classified as held for sale are measured