Looking at the exceptional items from 2007 to 2008, there seems to be a significant fall, from £278.5m to (£32.4m) showing a decrease of £310.9m. This was due to the defined benefit pension asset, it was a blank in 2007 and for 2008 it shows (£99.2m) which was used to set up a new system for Rank Group’s Pension Scheme.
Total exceptional items for 2008 was (£30.4) from the £278.5m in 2007. This is largely due to the new pension scheme for 2008. This isn’t necessarily a bad expense for the company, but is a sound investment for the future of its employees, enticing them to work hard to and commit to the company for many years ahead. For the incentive to have a safe and secure future once they retire from work.
Another key exceptional item was the VAT Refund, at a cost of £42.8m; this was due to a claim put in on May 22nd 2008, according to Rank Group the VAT and Duties Tribunal had held up the Group’s £36.6m claim relating to VAT paid on games of interval bingo between 2003 and 2005, an appeal will be considered by the High Court during March 2009, but meanwhile in November 2008 the Group received a refund of £59.1m covering the period they’d claimed, including up till June 2008. Unfortunately once costs and bingo gross profit tax this has resulted in a pre-tax gain of £42.8m.
Finally, property disposals at a cost of £4.1m meant that the Group had closed on of their Mecca Bingo Clubs in Swindon. The resulting profit on disposal of the property, with the profit on previously closed properties and disposal costs gave the £4.1m figure.
This has been an exceptionally bad year for all businesses so to see the closure of a Bingo Club is a loss to the company but its better than money just been wasted on a unsuccessful Club within the business.
Section D; Part (ii) Why might the company wish to voluntarily publish certain aspects of its activities?
In 2007, Ian Burke formed an Environment... [continues]
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