Formula One team Williams has blamed a £5m loss on accounting changes, that would otherwise have seen the company report a £4m profit.

In its annual report for 2012, Williams Grand Prix Holdings recorded the pretax loss due to a deferral of reporting of payments because of obligations required under FRS 5 Reporting the Substance of Transactions.

The loss comes in spite of an increase in turnover of more than £20m, to £124.3m, on the previous year's results - when the group had made a £7.4m profit. A Williams spokesperson confirmed that if the Formula One Management (FOM) payment had been included, the team would have instead reported a £4m profit.

Alex Burns, chief executive officer at Williams said: 'Williams has embarked on a long term strategy that combines visible success on the track with an ambitious diversification programme. The Williams brand and the intellectual property built up over many years of performing at the cutting edge of technological developments gives the Group a unique position in the global marketplace.'

He added: 'Revenue of £9.4m, received under the Bilateral Agreement with Formula One World Championship Limited, the sport's commercial rights holder, has not been included in these results because of the technical interpretation of today's accounting standards.'