financial statements





 
AMV Holding Ltd

For the period ended 30 September 2008

Company registration number: 05811953
 
 
 
 
 
 
 
AMV Holding Ltd

Financial Statements

Period from 1 January 2008 to 30 September 2008
 

 
 
Page
     
     
 
    1
     
 
    2
     
 
    5
     
 
    7
     
 
    8
     
 
    9
     
 
  10
     
 
  14
     
 
  17

        
AMV Holding Ltd

Officers and Professional Advisers
 
 

 
J W Cresswell
 
N D MacLeitch
   
   
N D MacLeitch
   
   
65 High Street
 
Marlow
 
Buckinghamshire
 
SL7 1AB
   
   
MacIntyre Hudson LLP
 
Chartered Accountants
 
& Registered Auditors
 
31 Castle Street
 
High Wycombe
 
Buckinghamshire
 
HP13 6RU

- 1 - -
 
AMV Holding Ltd

The Directors' Report

Period from 1 January 2008 to 30 September 2008
 
 

The directors have pleasure in presenting their report and the financial statements of the group for the period from 1 January 2008 to 30 September 2008.


Principal activities and business review
The principal activity of the company during the period was to act as a holding company for the seven subsidiary companies, namely American Mobile Ventures Limited, Blue Stream Mobile Limited, Antiphony Limited, Cell Media International Limited, Skynet Interactive Limited, Fierce Media Limited and Advanced Media Limited.  The group companies' activities include provisioning and marketing of content services to mobile phones in both the UK and overseas markets and providing services to the mobile phone sector.

The group's trading subsidiaries, American Mobile Ventures Limited, Blue Stream Mobile Limited and Antiphony Limited had been acquired in 2006 and the financial year ended 31 December 2007 was the first full year's trading of the group.  Antiphony acquired the Connection Makers business from Eckoh plc in January 2008 which has further extended the activities of the group.  £1.05 million of the consideration has been paid in the 9 months to 30 September 2008 with a further £700,000 payable in instalments over 14 months.  This has been held by the company’s own cash flow.

The group has seen a 27% annual growth in turnover from existing business and further turnover growth from the acquisition of Connection Makers business.  The directors anticipate continued expansion in 2009.


Results and dividends
The profit for the period, after taxation, amounted to £783,308. The directors have not recommended a dividend.


Directors
The directors who served the company during the period were as follows:

     
     


Group accounts
These consolidated financial statements have been prepared for the directors and shareholders of AMV Holding Ltd. AMV Holding Ltd is not required to prepare and file group accounts at Companies House and has not done so. These group accounts do not represent statutory accounts.

- 2 - -
 
AMV Holding Ltd

The Directors' Report (continued)

Period from 1 January 2008 to 30 September 2008


Directors' responsibilities
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). The financial statements are required by law to give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

·  

·  

·  

The directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the group and enable them to ensure that the financial statements comply with the Companies Act 1985. They are also responsible for safeguarding the assets of the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the directors are aware:

·  

·  


Donations
During the period the company made the following contributions:
 
     
Period to 30 Sep 08
      
Year to 31 Dec 07
  
     
£
      
£
  
                 
Charitable
     300       –  
 
- 3 - -
 
AMV Holding Ltd

The Directors' Report (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Auditor
A resolution to re-appoint MacIntyre Hudson LLP as auditor for the ensuing year will be proposed at the annual general meeting in accordance with section 385 of the Companies Act 1985.


Signed by order of the directors
 
 
 
 
  ___________________________
 
N D MacLeitch
 
Company Secretary


Approved by the directors on 8 December 2008
 
- 4 - -
 
AMV Holding Ltd

Independent Auditor's Report to the Shareholders of AMV Holding Ltd

Period from 1 January 2008 to 30 September 2008

We have audited the group and parent company financial statements ("the financial statements") of AMV Holding Ltd for the period from 1 January 2008 to 30 September 2008 which comprise the Group Profit and Loss Account, Group Balance Sheet, Company Balance Sheet, Group Cash Flow, Accounting Policies and the related notes. These financial statements have been prepared on the basis of the accounting policies set out therein.

This report is made solely to the company's shareholders, as a body, in accordance with Section 235 of the Companies Act 1985. Our audit work has been undertaken so that we might state to the company's shareholders 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 shareholders as a body, for our audit work, for this report, or for the opinions we have formed.


Respective responsibilities of directors and auditor
The directors' responsibilities for preparing the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the Statement of Directors' Responsibilities.

Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland).

We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with the Companies Act 1985. We also report to you whether in our opinion the information given in the Directors' Report is consistent with the financial statements.

In addition we report to you if, in our opinion, the company has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information specified by law regarding directors' remuneration and other transactions is not disclosed.

We read the Directors' Report and consider the implications for our report if we become aware of any apparent misstatements within it.


Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) 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 group's and 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.
 
- 5 - -
 
AMV Holding Ltd

Independent Auditor's Report to the Shareholders of AMV Holding Ltd (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Opinion
In our opinion:

·  

·  

·  


Restatement of financial statements under US Generally Accepted Accounting Practice
Set out as note 30 to the financial statements are the consolidated financial statements restated under US Generally Accepted Accounting Practice.  In our opinion, these restated financial statements give a true and fair view, in accordance with US Generally Accepted Accounting Practice, of the state of the group’s affairs for the 9 months ended 30 September 2008 and the 12 months ended 31 December 2007.



 
MACINTYRE HUDSON LLP
31 Castle Street
Chartered Accountants
High Wycombe
& Registered Auditors
Buckinghamshire
  
HP13 6RU
  


8 December 2008
 
- 6 - -
AMV Holding Ltd

Group Profit and Loss Account

Period from 1 January 2008 to 30 September 2008
 
   
Period from
      
   
1 Jan 08 to
  
Year to
  
   
30 Sep 08
  
31 Dec 07
  
Note  
   
£
      
£
      
£
  

    1                    
            14,182,635             14,918,407  
            1,254,649             –  
                    15,437,284       14,918,407  

    2               (5,047,472 )     (5,636,073 )
              10,389,812       9,282,334  

    2               (9,376,644 )     (7,213,716 )
    4                          
      1,043,366               2,068,618  
      (30,198 )             –  
              1,013,168       2,068,618  

              16,758       31,050  
    7               (2,051 )     (2,161 )
    8               (13,492 )     (8,984 )

                             
          1,014,383       2,088,523  
    9               231,075       662,319  

                                 
            783,308       1,426,204  

            (52,181 )     –  
                                      

            10               835,489       1,426,204  
            £ 835,489     £ 1,426,204  

All of the activities of the group are classed as continuing.
 
The group has no recognised gains or losses other than the results for the
period as set out above.

The company has taken advantage of section 230 of the Companies Act 1985
not to publish its own Profit and Loss Account.
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.

- 7 - -
 
AMV Holding Ltd

Group Balance Sheet

30 September 2008



         
   
£
      
£
      
£
  
Fixed assets
    12               2,782,569       1,090,721  
    13               223,320       180,354  
                      3,005,889       1,271,075  
Current assets
    15       4,999,660               3,792,236  
    16       8,608               10,659  
      1,661,695               1,354,967  
              6,669,963               5,157,862  
    17       7,448,110               5,107,707  
              (778,147 )     50,155  
      2,227,742       1,321,230  

    18               122,371       9,440  
                      2,105,371       1,311,790  
Provisions for liabilities                                
Deferred taxation
          
 
              
                             
                           
                    2,147,182     1,300,440  
Capital and reserves
    24               111       111  
    26               22,170       14,881  
    26               661,803       661,803  
    26               1,463,098       623,645  
    27             £ 2,147,182     £ 1,300,440  


These financial statements were approved by the directors and authorised for issue on 8 December 2008, and are signed on their behalf by:

 

__________________________
J W Cresswell
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
 
- 8 - -
 
AMV Holding Ltd

Company Balance Sheet

30 September 2008



         
   
£
      
£
      
£
  
 
                        
Fixed assets
    14       111       1,726,802       1,706,721  
                                 
Current assets                                
Debtors                          
                                 
                         
                                 
           
 
       )     )
                  527,900     516,647  
 
Capital and reserves                                
    24               111       111  
    26               22,170       14,881  
    26               505,619       501,655  
            £ 527,900     £ 516,647  

These financial statements were approved by the directors and authorised for issue on 8 December 2008, and are signed on their behalf by:


 

_________________________
J W Cresswell
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
 
- 9 - -
 
AMV Holding Ltd

Group Cash Flow

Period from 1 January 2008 to 30 September 2008


         
       
       
     
£
      
£
      
£
  
                2,093,810  
                       
Returns on investments and servicing of finance                      
    16,758             17,664  
    (12,638 )           (7,707 )
    (854 )           (1,277 )
                       
            3,266       8,680  
                         
            5,490       (477,698 )
                         
Capital expenditure and financial investment                        
    (1,121,000 )             –  
Payments to acquire tangible fixed assets
     (80,527 )             (136,640 )
    –               13,568  
    –               158,925  
                         
            (1,201,527 )     35,853  
 
    –               7  
    7,289               9,921  
    (203,810 )             (446,190 )
    (2,469 )             (3,017 )
            (198,990 )     (439,279 )
                            
 
 
       (707,055 )   944,853  
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
 
- 10 - -
 
 
AMV Holding Ltd

Group Cash Flow (continued)

Period from 1 January 2008 to 30 September 2008


Reconciliation of operating profit to net cash inflow from
operating activities
 
     
Period from
          
     
1 Jan 08 to
      
Year to 
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    1,013,168       2,068,618  
    520,068       57,671  
    40,891       31,944  
    (1,207,404 )     (2,380,872 )
    418,064       2,316,449  
  £ 784,787     £ 2,093,810  

Reconciliation of net cash flow to movement in net funds

     
30 Sep 08
        
                   
                         
    (707,055 )     111       944,853  
                         
    203,810               446,190  
    2,469               (12,731 )
                         
            (500,776 )     1,378,312  
                         
   
 
              
                         
   
 
     £     £  
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
 
- 11 - -
 
AMV Holding Ltd

Group Cash Flow (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Analysis of changes in net funds
 
     
At
1 Jan 2008
      
Cash Flows
      
At
30 Sept 2008
  
                   
                         
Net cash:                        
    1,354,967       306,728       1,661,695  
    (32,856 )     (1,013,783 )     (1,046,639 )
      1,322,111       (707,055 )     615,056  
                         
Debt:                        
    (203,810 )     203,810       –  
    –       –       –  
    (12,731 )     2,469       (10,262 )
      (216,541 )     206,279       (10,262 )
  £ 1,105,570     £ (500,776 )   £ 604,794  
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
 
- 12 - -
 
AMV Holding Ltd

Group Cash Flow (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Purchase of subsidiary undertakings

   
£
  
1. Fierce Media Limited
      
Net cash acquired with subsidiary undertakings, 9 January 2008
     –  
Other net assets
     100  
Minority Interest
     (20 )
Settled by cash
   £ 80  

2. Advanced Media Limited
      
Net cash acquired with subsidiary undertakings, 15 February 2008
     –  
Other net liabilities
     (150,816 )
Total of net liabilities on acquisition
     (150,816 )
Goodwill
     230,816  
Settled by cash
   £ 80,000  

3. Skynet Interactive Limited
      
Net cash acquired with subsidiary undertakings, 30 September 2008
     –  
Other net assets
     1  
Settled by cash
   £ 1  
                
Acquisition of subsidiaries
  
£
 80,081   
 
4. Connection Makers trade acquired by Antiphony Limited
On 1 January 2008 Antiphony Limited acquired the trade and assets of Connection Makers, a division of Eckoh plc for £1,750,000.  £600,000 was paid in cash on completion, with deferred consideration of £1,150,000 being paid over 23 months.  The assets purchased were £20,000 of equipment and £1,730,000 of goodwill.

5. Antiphony Limited
Under the terms of the original acquisition agreement whereby AMV Holding Limited acquired Antiphony Limited, a further consideration payment of £20,000 became payable.  This has been treated as additional goodwill.
 
 
The accounting policies and notes on pages 14 to 31 form part of these financial statements.
- 13 - -
 
AMV Holding Ltd

Accounting Policies

Period from 1 January 2008 to 30 September 2008
 
 
Basis of accounting
The financial statements have been prepared under the historical cost convention.

Basis of consolidation
The consolidated financial statements incorporate the financial statements of the company and all group undertakings. These are adjusted, where appropriate, to conform to group accounting policies. Acquisitions are accounted for under the acquisition method and goodwill on consolidation is capitalised and written off over a maximum of 20 years from the date of acquisition. The results of companies acquired or disposed of are included in the profit and loss account after or up to the date that control passes respectively. As a consolidated profit and loss account is published, a separate profit and loss account for the parent company is omitted from the group financial statements by virtue of section 230 of the Companies Act 1985.

Turnover
The turnover shown in the profit and loss account represents amounts invoiceable during the period, exclusive of Value Added Tax.

Goodwill
Positive goodwill on acquisition is capitalised, classified as an asset on the balance sheet and amortised on a straight line basis over its useful economic life up to a presumed maximum of 20 years.  It is reviewed for impairment at the end of the first full financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

Negative goodwill is released to the profit and loss account in the periods in which the non-monetary assets acquired are recovered.  Any negative goodwill in excess of the fair values of non-monetary assets acquired is recognised in the profit and loss account in the periods expected to be benefited.

Negative goodwill arose from the re-organisation of the group on 31 August 2006. In the directors' opinion it was necessary to depart from Financial Reporting Standard 10 in order to show a true and fair view. Accordingly negative goodwill of £661,803 was credited to Other Reserves in the year ended 31 December 2006.

Research and development
Development expenditure is capitalised in line with SSAP 13 Accounting for Research and Development in order to comply with the accruals and prudence concepts in the preparation of the financial statements.

The expenditure capitalised relates to the development of a new SMS Content Platform, the Content Platform is not yet complete and hence no amortisation has been charged in this period.

Research costs are charged to the profit and loss account as incurred.

Other intangible fixed assets
Licences are reviewed for impairment at the end of the first full financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

Amortisation
Amortisation is calculated so as to write off the cost of an asset, net of anticipated disposal proceeds, over the useful economic life of that asset as follows:

-
Over 20 years
-
Over 3 years
 
- 14 - -
 
AMV Holding Ltd

Accounting Policies (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Fixed assets
All fixed assets are initially recorded at cost.

Depreciation
Depreciation is calculated so as to write off the cost of an asset, net of anticipated disposal proceeds, over the useful economic life of that asset as follows:

-
Over 3 years
-
15% on written down value
-
25% on written down value
-
25% on written down value

Hire purchase agreements
Assets held under hire purchase agreements are capitalised and disclosed under tangible fixed assets at their fair value. The capital element of the future payments is treated as a liability and the interest is charged to the profit and loss account at a constant rate of charge on the balance of capital repayments outstanding.

Operating lease agreements
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged against profits on a straight line basis over the period of the lease.

Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more tax, with the following exceptions:

Provision is made for tax on gains arising from the revaluation (and similar fair value adjustments) of fixed assets, and gains on disposal of fixed assets that have been rolled over into replacement assets, only to the extent that, at the balance sheet date, there is a binding agreement to dispose of the assets concerned. However, no provision is made where, on the basis of all available evidence at the balance sheet date, it is more likely than not that the taxable gain will be rolled over into replacement assets and charged to tax only where the replacement assets are sold.

Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.

Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of the transaction. Exchange differences are taken into account in arriving at the operating profit.
 
- 15 - -
 
AMV Holding Ltd

Accounting Policies (continued)

Period from 1 January 2008 to 30 September 2008
 
 
Employee share schemes
The company issues equity-settled and cash-settled share-based payments to certain employees of the company. Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, together with a corresponding increase in equity, based upon the company's estimate of the shares that will eventually vest.

The impact is not considered to be material for adjustment in the financial statements.

Pension costs
The company operates a deferred contribution pension scheme for the benefit of certain employees.  The costs relating to this scheme are charged to the profit and loss as they fall due.
 
- 16 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
Turnover
 
The turnover and profit before tax are attributable to the one principal activity of the group.

An analysis of turnover is given below:
 
     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    11,241,199       12,996,965  
    4,196,085       1,921,442  
    £ 15,437,284     £ 14,918,407  

2.        Analysis of cost of sales and net operating expenses
 
     
 Continuing
      
Acquired 
          
     
operations
            
Total
  
                   
 
Period from 1 January 2008 to 30 September 2008                        
    3,894,255       1,153,217       5,047,472  
                6,374,675  
                 
    (179         (382
  £     £
 
   £  
Year ended 31 December 2007                        
          -        
          -         
          -         
          -         
   
(11,541)
       -         
  £       -     £  
 
- 17 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
3.        Other operating income

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
    32       –  
    350       11,541  
    £ 382     £ 11,541  


4.        Operating profit
Operating profit is stated after charging:

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    520,068       57,671  
    38,008       26,819  
    2,883       5,125  
Auditor's remuneration                
- as auditor
     24,600       10,800  
Operating lease costs:                
- Buildings
     153,970       37,652  
    12,232       13,650  
 
- 18 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
5.        Particulars of employees
 
The average number of staff employed by the group during the financial period amounted to:

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    47       33  
      47       33  

The aggregate payroll costs of the above were:
 
     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    1,385,170       2,471,722  
    152,512       296,986  
    60,000       –  
    1,499       –  
    £ 1,599,181     £ 2,768,708  


6.        Directors' emoluments
The directors' aggregate emoluments in respect of qualifying services were:

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    149,488       1,655,638  
    £ 149,488     £ 1,655,638  

        Emoluments of highest paid director:

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    74,744       610,373  


     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
Number of directors to whom pension contributions were paid
     2       –  
 
- 19 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
7.        Amounts written off investments

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    2,051       2,161  


8.        Interest payable and similar charges

     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    12,243       656  
    854       1,277  
    395       7,051  
    £ 13,492     £ 8,984  


9.        Taxation on ordinary activities
(a) Analysis of charge in the period
 
     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             

Current tax:

In respect of the period:

UK Corporation tax based on the results for the period at 28% (2007 - 30%)     232,240       656,159  
Over provision in prior year     (165 )     -  
    232,075       656,159  
                 
Deferred tax:                
                 
    )      
                 
  231,075     662,319  
 
 
- 20 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
9.        Taxation on ordinary activities (continued)
(b) Factors affecting current tax char
 
The tax assessed on the profit on ordinary activities for the period is higher than the standard rate of corporation tax in the UK of 28% (2007 - 30%).
 
     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
                 
    1,014,384       2,088,523  
    230,897       626,557  
    30,943       32,677  
Capital allowances for period in excess of depreciation
     (33,766 )     (3,059 )
Small companies relief
     -       (16 )
Tax chargeable at different rates
     4,167       -  
Adjustments to tax charge in respect of previous periods
     (166 )     -  
                 
  £ 232,075     £ 656,159  


10.     Profit attributable to members of the parent company
 
The profit dealt with in the accounts of the parent company was £Nil (2007 - £276,783).


11.      Dividends
Equity dividends
      
     
Period from
          
     
1 Jan 08 to
      
Year to
  
     
30 Sep 08
      
31 Dec 07
  
             
Paid                
    –       276,783  
 
- 21 - -
 
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
12.
 
Group                        
   
Goodwill
    
Development
Costs
    
Licences
    
Total
  
   
£
    
£
    
£
    
£
  
Cost                                
    1,153,413       –       –       1,153,413  
    1,980,916       91,000       140,000       2,211,916  
    3,134,329       91,000       231,000       3,365,329  

Amortisation                                
    62,692       –       –       62,692  
    485,068       –       35,000       520,068  
    547,760       –       35,000       582,760  

Net book value                                
  £ 2,586,569     £ 91,000     £ 105,000     £ 2,782,569  
  £ 1,090,721       –       –     £ 1,090,721  


        
                             
   
Plant
and
machinery
    
Fixtures
and
fittings
    
Motor
vehicles
        
Total
  
                     
Cost                              
    –       55,791       20,500       143,461       219,752  
    10,634       3,929       –       69,294       83,857  
    10,634       59,720       20,500       212,755       303,609  

Depreciation                                        
    –       8,713       5,125       25,560       39,398  
    594       5,607       2,883       31,807       40,891  
    594       14,320       8,008       57,367       80,289  

Net book value                                        
  £ 10,040     £ 45,400     £ 12,492     £ 155,388     £ 223,320  
    –     £ 47,078     £ 15,375     £ 117,901     £ 180,354  
 
 
- 22 - -
 
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
Hire purchase agreements
 
Included within the net book value of £223,320 is £12,492 (2007 - £15,375) relating to assets held under hire purchase agreements. The depreciation charged to the financial statements in the period in respect of such assets amounted to £2,883 (2007 - £5,125).

 
Investments
 
     
   
Group
companies
  
     
Cost        
    1,706,721  
    20,081  
    1,726,802  
 
 
- 23 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
14.
Investments (continued)
        
 
Country
of
incorporation
Holding
shares held
Nature of business
         
Subsidiary undertakings        
         
All held by the company:        
         
   Ventures Limited
England
   mobile phone content products
         
   Mobile Limited
   mobile phone content products
         
   phone sector
         
   International Limited
   mobile phone content products
         
   and web broadcasts
         
   Interactive Limited
   not traded in the period
         
Held by Fierce Media Limited:
        
         
Advanced Media Ltd
England
Ordinary shares
100%
Licence ownership to enable the
   group to deliver live television
   broadcast in the UK


Debtors
 
         
                 
   
£
    
£
    
£
    
£
  
    2,689,532       1,220,480       –       –  
    –       –       4,964       –  
    23,430       97,011       1,196       9,927  
    181,291       243,568       –       –  
    2,105,407       2,231,177       –       –  
    £ 4,999,660     £ 3,792,236     £ 6,160     £ 9,927  
 
- 24 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
         
                 
   
£
    
£
    
£
    
£
  
    8,608       10,659       –       –  

Listed investments
 
Investments having a net book value of £8,608 (2007 - £10,659) are listed on a recognised stock exchange and had a market value of £8,608 at the end of the period (2007 - £10,659).


Creditors: amounts falling due within one year
 
         
                 
   
£
    
£
    
£
    
£
  
    1,046,639       32,856       –       –  
    2,894,883       1,594,507       –       –  
    –       –       1,205,062       996,190  
    3,291       3,291       –       –  
    2,822,660       1,626,056       –       203,811  
    680,637       1,850,997       –       –  
    £ 7,448,110     £ 5,107,707     £ 1,205,062     £ 1,200,001  

The following liabilities disclosed under creditors falling due within one year are secured by the company:

         
                 
   
£
    
£
    
£
    
£
  
    1,046,639       32,856       –       –  
Hire purchase agreements
     3,291       3,291       –       –  
    £ 1,049,930     £ 36,147       –       –  


 
       
Company
  
                 
   
£
    
£
    
£
    
£
  
    6,971       9,440       –       –  
    115,400       –       –       –  
    £ 122,371     £ 9,440       –       –  

The following liabilities disclosed under creditors falling due after more than one year are secured by the company:

Hire purchase agreements
     6,971       9,440       –       –  
 
- 25 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
Future commitments under hire purchase agreements are as follows:
 
       
Company
  
                 
   
£
    
£
    
£
    
£
  
    3,291       3,291       -       -  
    6,971       9,440       -       -  
    £ 10,262     £ 12,731       -       -  


Deferred taxation
 
The movement in the deferred taxation provision during the period was:
 
   
Group
    
Company
  
   
1 Jan 08 to
30 Sep 08
    
Year to
31 Dec 07
    
1 Jan 08 to
30 Sep 08
    
Year to
31 Dec 07
  
                 
Provision brought forward
     11,350       5,190       -       -  
    (1,000 )     6,160       -       -  
  £ 10,350     £ 11,350       -       -  

The group's provision for deferred taxation consists of the tax effect of timing differences in respect of:

 
30 Sep 08
    
31 Dec 07
  
   
Provided
    
Unprovided
    
Provided
    
Unprovided
  
                 
    10,350       -       11,350       -  


Commitments under operating leases
 
At 30 September 2008 the group had annual commitments under non-cancellable operating leases as set out below.

   
30 Sep 08
      
31 Dec 07
  
     
Land and
buildings
            
Land and
Buildings
      
Other
items
  
                 
£
        
                                 
Operating leases which expire:                                
                                 
    18,733       13,768       22,480       13,768  
 
- 26 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
At 30 September 2008 J W Cresswell, owed the group £178,252 (31 December 2007: £113,260). The maximum amount owed to the group during the period was £178,252 (31 December 2007: £113,260).

At 30 September 2008 N D MacLeitch, owed the group £3,039 (31 December 2007: £130,308). The maximum amount owed to the company during the period was £3,039 (31 December 2007: £130,308).

Interest charged on the above overdrawn loan accounts during the period to 30 September 2008 was £Nil (year to 31 December 2007: £Nil).


 
No transactions with related parties were undertaken such as are required to be disclosed under Financial Reporting Standard 8.
        
Authorised share capital:
 
         
   
£
    
£
  
    980       980  
    20       20  
    £ 1,000     £ 1,000  

Allotted, called up and fully paid:

   
30 Sep 08
    
31 Dec 07
  
                 
                         
    104,075       104       103,571       104  
    7,142       7       7,142       7  
      111,217     £ 111       110,713     £ 111  

The company reclassified its authorised share capital during the year to create an additional class of non-voting shares.

On 31 July 2008 404 Ordinary shares were issued at £17.70 per share to four employees.

On 31 July 2008 100 Ordinary shares were issued under the share option scheme at £1.39 per share.
 
- 27 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
The group has a share option scheme for all employees. Options are exercisable on sale or flotation of the company at a price equal to the average market price of the company's shares on the date of grant. The vesting of options is also dependent on eligible executives meeting performance criteria. The options are settled in equity once exercised.

If the options remain unexercised after a period of 10 years from the date of grant, the options expire. Options are forfeited if the employee leaves the group company before the options vest.

10,806 share options were granted to 35 employees on 31 July 2008 at an exercise price of £17.70 per share. 230 options lapsed and 100 were exercised during the year, the remaining options were all exercised on 23 October 2008 following the sale of the company.



 
Share
premium
count
    
Other
reserves
    
Profit
and loss
account
  
             
                         
    14,881       661,803       623,645  
    –       –       835,489  
    –       –       3,964  
                       
    7,289       –       –  
  £ 22,170     £ 661,803     £ 1,463,098  

 
Share
premium
account
    
Profit
and loss
account
  
         
                 
    14,881       501,655  
    –       3,964  
               
    7,289       –  
  £ 22,170     £ 505,619  
 
- 28 - -
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
 
         
 
£
    
£
    
£
  
    –       835,489       1,426,204  
    –               7  
    7,289               9,921  
              7,289          
            –       (276,783 )
            3,964       –  
            846,742       1,159,349  
      1,300,440       141,091  
    £ 2,147,182     £ 1,300,440  


 
On 8 October 2008 an offer by Mandalay Media Inc, a company incorporated in the United States of America, to acquire all the issued shares of the company was accepted by the shareholders of AMV Holding Limited.


 
In the opinion of the directors there is no ultimate controlling party.


30.
Restatement of financial information under US Generally Accepted Accounting Practice
 
The consolidated financial information has been restated for information purposes only under US Generally Accepted Accounting Practice as set out below. An adjustment has been made in respect of accounting for goodwill amortisation. The summarised consolidated financial information for the 9 months ended 30 September 2008 and the 12 months ended 31 December 2007 have been restated as follows:

   
2008
9 months
    
2007
12 months
  
   
£
    
£
  
Profit on ordinary activities before tax as shown
on the financial statements
     1,014,383       2,088,523  
Items increasing reported profits
                
Amortisation of goodwill
     520,068       57,671  
Profit before tax according to accounting principles in the United States
   £ 1,534,451     £ 2,146,194  
 
 
- 29 -
 
 
AMV Holding Ltd

Notes to the Financial Statements

Period from 1 January 2008 to 30 September 2008
 
 
30.      Restatement of financial information under US generally accepted accounting practice (continued)
 
      30 September
2008
      
31 December 2007
  
As restated
    
£
      
£
  
 
1.        Profit and Loss Account

Group turnover
     15,437,284       14,918,407  

Cost of sales
     (5,047,472 )     (5,636,073 )

Group profit
     10,389,812       9,282,334  

Distribution costs
     (6,374,675 )     (3,587,321 )

Administration expenses
     (2,482,283 )     (3,580,265 )

Other operating income
     382       11,541  

Operating profit
     1,533,236       2,126,289  

Interest receivable
     16,758       31,050  

Amounts written off investments
     (2,051 )     (2,161 )

Interest payable
     (13,492 )     (8,984 )

Profit on ordinary activities before tax
     1,534,451       2,146,194  

Tax on profit on ordinary activities
     (213,075 )     (662,319 )

Profit on ordinary activities after tax
     1,303,376       1,483,875  

Minority interests
     52,181       –  
                 
Attributable to equity members
   £ 1,355,557     £ 1,483,875  

 
- 30 -
 
30.      Restatement of financial information under US generally accepted accounting practice (continued)
 
2.        Balance Sheet
 
      30 September
2008
      
31 December 2007
  
     
£
      
£
  
                 
Fixed assets
     3,365,329       1,153,413  
Intangible assets
     223,320       180,354  
Tangible assets
     3,588,649       1,333,767  
Current assets
                
Debtors
     4,999,660       3,792,236  
Investments
     8,608       10,659  
Cash at bank and in hand
     1,661,695       1,354,967  
 
    6,669,963       5,157,862  

Creditors: Amounts falling due within one year
     (7,448,110 )     (5,107,707 )
Net current assets/(liabilities)
     (778,147 )     50,155  
Total assets less current liabilities
     2,810,502       1,383,922  

Creditors: Amounts falling due after one year
     (122,371 )     (9,440 )
      2,688,131       1,374,482  
Provision for liabilities
                
Deferred taxation
     (10,350 )     (11,350 )
Monitory interests
     52,161       –  
    £ 2,729,942     £ 1,363,132  
Capital and reserves
                
Called up equity share capital
     111       111  
Share premium account
     22,170       14,881  
Other reserves
     661,803       661,803  
Profit and loss account
     2,045,858       686,337  
    £ 2,729,942     £ 1,363,132  
3.        Reconciliation of movement in shareholders funds                
Opening shareholders funds
     1,363,132       146,112  
Profit for the year
     1,355,557       1,483,875  
New equity share capital subscribed
     –       7  
Dividend waived
     3,964       –  
Premium on new share capital subscribed
     7,289       9,921  
Equity dividends
     –       (276,783 )
Other reserve arising on grouping
     –       –  
Closing shareholders funds
   £ 2,729,942     £ 1,363,132  


- 31 -