The main accounting policies of the Board have remained unchanged from the previous year and are set out below. Accounting Convention The accounts are prepared under the historical cost convention, modified by the inclusion of: a) fixed assets at their value to the business by reference to current costs; and b) stocks at the lower of net current replacement cost (or historical cost if this is not materially different) and net realisable value, and on an accruals basis. Without limiting the information given, the accounts meet the accounting and disclosure requirements of the Companies Act 1985 and accounting standards issued or adopted by the Accounting Standards Board so far as those requirements are appropriate. Fixed Assets and Depreciation Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost or valuation, less estimated residual value, of each asset evenly over its expected useful life as follows: Fixtures and fittings   – over 10 years Non-PC office equipment purchase – over 6 years PC equipment purchase – over 4 years Fixed assets are valued for current cost using indices provided by the Office for National Statistics. Government Grants Grants received from HM Government by way of cash Grant-in-Aid for operating purposes are credited to income in the year to which they relate. Government grants in respect of capital expenditure are credited to a deferred income account and are released to profit over the expected useful lives of the relevant assets by equal annual instalments. Government grants for assistance to tourism projects under Section 4 of the Development of Tourism Act 1969 ceased in June 1993. Stocks Stocks of saleable publications and promotional items are stated at the lower of net current replacement cost (or historical cost if this is not materially different) and net realisable value. Net realisable value is based on estimated selling price less further costs expected to be incurred on disposal. Historical cost includes costs incurred in bringing each product to its present location and condition, on a first-in, first-out basis. Costs incurred in producing free issue brochures and obtaining promotional items for which no selling price is charged are written off to the Income and Expenditure Account in the year of purchase. Foreign Currencies Assets and liabilities denominated in foreign currencies have been translated into Sterling values at the rate of exchange ruling at the Balance Sheet date. Transactions in foreign currencies are recorded at the rate ruling at the time of the transaction. All exchange differences are taken to the Income and Expenditure Account. Loans and Interest Thereon In the Balance Sheet, loans made under Section 4 of the Development of Tourism Act 1969 in support of tourist projects are shown as ‘Secured loans’. Interest on loans is refundable to HM Government as and when received. Recoverable Grants It is the policy of the Board to recover grants to tourist projects made under Section 4 of the Development of Tourism Act 1969 where the conditions attaching thereto have been breached and no acceptable alternative conditions can be implemented. Recoverable grants are refundable to HM Government as and when received, therefore no provision is required against any recoverable grants which are considered doubtful. Leases All leases are regarded as operating leases and the total payments made under them are charged to the Income and Expenditure Account on a straight line basis over the lease terms. Income and Expenditure Account All income and expenditure relates to the Board’s continuing activities. There have been no acquisitions or discontinued activities during the year. Pensions The Board participates in the British Tourist Boards’ pension scheme which is a defined benefit scheme. Pension fund liabilities are assessed by independent professionally qualified actuaries at triennial valuations. In accordance with the requirements of Statement of Standard Accounting Practice No 24 pension costs are charged against the Income and Expenditure Account using actuarial valuation methods intended to spread the pension cost evenly over the average service lives of the current employees in the scheme. In accordance with Financial Reporting Standard 17, appropriate disclosures have been made in respect of pension scheme assets and liabilities. Notional Costs Notional Cost of Capital has been calculated at 6% of the average of total assets less current liabilities during the year as required by Scottish Executive guidelines. Value Added Tax Expenditure in these accounts is stated inclusive of irrecoverable VAT.