AVESCOGROUPPLC ANNUAL REPORT 2009 63
www.avesco.com
37. Contingencies
InvestinMedia Holdings Limited (“InvestinMedia”), a subsidiary of the Company, sold its investment in Complete Communications Corporation Limited (“Complete”)
on 20 December 2006. In connection with the sale, InvestinMedia and other vendors gave certain warranties and indemnities to the buyer, liability in respect of
which runs for periods of up to seven years from the date of completion. The buyer is pursuing legal action on behalf of InvestinMedia and other vendors, the
costs of which are covered by an indemnity. Companies in the Complete group are also subject to legal claims which may give rise to liability on the part of
InvestinMedia and the other vendors under the warranties and indemnities. An estimate of InvestinMedia’s share of any liabilities that may arise from these
actions has been provided for in the accounts.
38. Related party transactions
Group
The Group has taken advantage of the exemption available under IAS 24 ‘Related party disclosures’ not to disclose transactions and balances between Group
entities that have been eliminated on consolidation.
Other than the Directors of the Company, the Group does not have any further individuals classified as key management as per IAS 24. Details of the Directors’
remuneration are set out on pages 20 to 21. These details form part of the financial statements.
Mr B Ramsey, stepson of Mr G Andrews (Executive Director), is employed on standard contract terms by Creative Technology Group Inc.
Mr J Martin, son of Mr I Martin (Chief Executive), was employed on standard contract terms by Fountain Television Limited from October to December 2008.
The Company is party to the cross guarantee arrangements that the Group has in respect of its UK borrowings with HSBC Bank plc.
Company
During the year the Company paid management fees to subsidiaries of £100,000 (2008: £154,000). Additionally the Company received interest of £1,120,000
(2008: £1,517,000) and paid interest of £84,000 (2008: £224,000) to subsidiaries. Finally, the Company received dividends of £6,500,000 (2008: £6,354,000) from
subsidiaries.
At the year end balances due from subsidiaries to the Company amounted to £31,897,000 (2008: £18,879,000) and due to subsidiaries from the Company
amounted to £971,000 (2008: £3,191,000).
The Company is a member of the Avesco value added tax group and is a party to the cross guarantee arrangements that the Group has in respect of its UK
borrowings with HSBC Bank Plc. The total Group borrowings as at 30 September 2009 are £14,349,000 (2008: £14,366,000).
The Company is also party to the cross guarantee arrangements that the Group has in respect of its hire purchase obligations. The total Group hire purchase
commitments as at 30 September 2009 are £11,244,000 (2008: £10,325,000).
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