<< Previous | Next >>

Chapter Five: Annual Accounts

Notes to the accounts - 1. Accounting Policies

The financial statements have been prepared in accordance with the Resource Accounting Manual issued by HM Treasury. The particular accounting policies adopted by SCS are described below. They have been applied consistently in dealing with items considered material in relation to the accounts.

1.1 Basis of Accounting
These accounts have been prepared in accordance with the historical cost convention modified to account for the revaluation of fixed assets at their value to the agency by reference to their current costs.

1.2 Tangible Fixed Assets
Land & buildings
All of the freehold properties were valued as at 31 March 1999 by District Valuers (DVs) of the Valuation Office Agency. All of the valuations have been undertaken on the under-noted basis in accordance with the Appraisal and Valuation Manual of the Royal Institution of Chartered Surveyors. These valuations were revalued up to 31 March 2003 using the DETR Quarterly Building Price & Cost Indices.

All owner occupied court-houses are considered to be specialised operational properties and valuations are therefore on the basis of Depreciation Replacement Cost (DRC). The open market value of these properties is substantially lower.

The sources of information and assumptions made in producing the various valuations are set out in the Valuation Certificate, which is not published within the Annual Report and Accounts.

The valuation figures incorporated in the accounts are the aggregate of separate valuations of parts of the portfolio, not a valuation or apportioned valuation of the portfolio valued as a whole.

Departmental estate is treated as an asset of the Agency, although legal ownership rests with the Scottish Ministers. This reflects the Agency's position as the principal beneficial user of the property.

Other tangible assets have been stated at current cost as at 31 March 2003 using the National Statistics price indices for current cost accounting to take account of specific price changes.

Internally developed software is valued at cost.

The threshold for capitalisation of tangible fixed assets is £5,000. Assets (excluding buildings) that are purchased in a single transaction are grouped together and capitalised if the cost is above £5,000.