Windmill_Hill_Asset_Manag - Accounts

The directors present the strategic report for the year ended 31 December 2021.

Windmill Hill Asset Management Limited (“WHAM” or the “Firm”) is a UK Company regulated by the Financial Conduct Authority (“FCA”) providing discretionary and advisory asset management services to institutional clients, in particular, charitable foundations. Its objective is to remain a centre of investment excellence, providing outstanding investment performance to its clients.

The Board of Directors is responsible for the overall stewardship of the Firm. The Firm’s performance for the year is set out in the Statement of comprehensive income on page 12 and is considered by the Board of Directors to be satisfactory compared to last year, to budget and to the Firm’s longer-term strategy.

WHAM’s strategic aims are primarily measured by the investment returns it generates for its clients. In 2021 investment returns were generally strong.

Directors’ Statement of compliance with section 172(1) of the Companies Act 2006

The Board of Directors consider, both individually and collectively, that they have acted in a way they consider, in good faith, is most likely to promote the success of the Company for the benefit of its members in the decisions taken during the year ending 31 December 2021.

The Board of Directors has regard, amongst other matters, to:

• The likely consequences of any decision in the long-term;

• The interests of the Firm’s employees;

• The need to foster the Firm’s business relationships with suppliers, customers and any other key stakeholders;

• The impact of the Firm’s operations on the community and the environment;    

• The importance of maintaining a reputation for high standards of conduct; and

• The need to act fairly with members of the company.

Long Term Decision Making

WHAM’s governance structure is designed to enable the Board of Directors to exercise comprehensive oversight over the Firm’s business. This includes monitoring the Firm’s financial position and business activities including its interactions with clients, regulatory compliance, employee matters and contributing to the Firm’s objective of being a centre of investment excellence.

The Firm’s financial position is regularly reviewed, including its capital adequacy. The Firm ensures that it has sufficient capital for its short-term and long-term requirements, and this is reflected in its healthy Balance Sheet.

The Firm’s clients have two investment objectives: Long term capital preservation and capital growth. These dual objectives are carefully monitored by the Board of Directors, as well as by two further Committees, the Investment Committee and the Investment Advisory Committee.

Employees’ Interests

The Board of Directors take active steps to ensure that the suggestions, views, and interests of employees are captured and considered in the decision-making process. WHAM has a number of effective employee engagement mechanisms in place to assist with this:

• Employees are provided with Minutes of each Investment Committee meeting and the Investment Advisory Committee where the main investment decisions are taken;

• Employees are kept informed of performance and strategy through regular meetings and where appropriate, correspondence from members of the Board of Directors;

• Executive Directors attend key business meetings throughout the year;

• Investment staff participate in two meetings a week to discuss short- and long-term investment decisions. At one of these meetings, wider participation from the Firm is encouraged;

• Employees attend objectives and bi-annual appraisal meetings, the results of which are reviewed by the Executive Directors and Executive Committee;

• Employees are offered regular opportunities for skills training to help with their development.

Environmental Impact

WHAM assesses its environmental impact as part of an Environment, Social and Governance review, carried out at both corporate and portfolio level. At a corporate level, the Firm has adopted the Cycle to Work Scheme as part of the Government’s Green Transport Plan. In addition, following employees’ requests to work remotely on a more regular basis, the Firm is trialling a hybrid office and remote working arrangement. This has the effect of cutting congestion on the roads whilst having a positive impact on the environment. At the portfolio level, Clean Energy has remained a key investment theme in 2021 and the Firm continues to look for further ESG-related investment opportunities.     

Fostering the Firm’s Business Relationships and Standards of Business Conduct

The Firm recognises and accepts the need to foster its business relationships with suppliers, clients, and other key stakeholders. The Firm enjoys long-term relationships with its key suppliers and meets with them regularly to ensure that the services provided remain of the standard required and relevant to the Firm’s needs. The Firm aims to pay its suppliers within 30 days’ of receiving an invoice for payment.

The Board of Directors place great emphasis on providing outstanding investment performance to its clients and ensuring that their interests remain paramount. Through regular communications, including monthly investment performance reporting, periodic presentations and review meetings, WHAM is able to identify a client’s needs and ensure that these are met.

The Firm recognises the importance of maintaining a reputation for high standards of business conduct. This is achieved through operating a robust corporate governance framework as well as providing regular training for all employees. The Firm has an Aggregation and Allocation Policy which is designed to ensure that all clients are treated fairly. If a decision is taken to treat one client differently to another, this decision is recorded providing a clear explanation for the action taken. The Firm also has a Conflicts of Interest Policy which is strictly adhered to. The Board of Directors believe that it is important to apply robust governance practices and training to encourage behaviour consistent with the Firm’s values and to ensure regulatory compliance throughout the firm.

Based on the information provided above, the Board of Directors believe they have complied with the requirement of Section 172 of the Companies Act 2006.

Pillar 3 and Remuneration Disclosure

The Firm is categorised as a “BIPRU Firm” for capital purposes and reports on a solo basis. The Firm’s Pillar 3 disclosure fulfils the Firm’s obligation to disclose key pieces of information on the Firm’s capital, risk exposures and risk assessment processes.

Principal risks and uncertainties

The Firm's risk management policy reflects the FCA requirement that the Board of Directors manages a number of categories of risk. These include, where applicable: credit, market, business, operational, insurance, liquidity, and group risk. In respect of this disclosure, it is the first four that are relevant and further information is provided below.

Credit risk

The Firm's current business model does not expose the business to any material credit risk. The credit risk capital requirement arises only due to the holding of bank deposits and any past due items which are calculated as £225,000. The Firm has concluded that no further action and/or additional capital is required to mitigate this risk due to the surplus held over its capital requirement.

Market risk

Under Pillar 1, the Firm has exposure to foreign exchange risk due to the foreign currency bank deposits held. The foreign exchange risk requirement is calculated as £12,000. The Firm has sufficient capital resources to mitigate this risk and so has concluded that no additional capital is required to mitigate this risk.

Business risk

The Firm's Pillar 2 business risk assessment considers the impact on the Firm’s financial position of a fall in assets under management following a market downturn or change in client composition.

The Firm's Executive Directors are responsible for monitoring the impact of any market downturn on the business. Controls implemented include the monitoring of its budgets, expenses, fund manager performance, and market performance. Monthly management accounts are reviewed by the Chief Operating Officer and the Chief Executive Officer. Quarterly management accounts are reviewed by the Firm’s executive management committee and management accounts and other financial information are reviewed by the Board of Directors.

Operational risk

Most of the Firm's risk management efforts are focused on operational risk. This includes everything from high-level strategy to the risk of administrative errors, fraud, and theft. The Firm's policy is to operate a robust and effective risk management process, embedded within the governance and management structures of the business.

The Firm's risk management framework is approved by the Board of Directors. The main initiative is the establishment of a 'Risk Map' which includes the analysis of key risk areas identified by senior management. These areas cover risk items within the following areas: Investment Management/Advisory; Financial Crime; Capital Adequacy; Personnel; Market; Client; Business Continuity; Strategy; Outsourcing; Operations; Legal; Regulatory Compliance and Financial Promotions.

The Firm seeks to identify the impact and probability of each risk item and rank it as high, medium, or low. The Firm also identifies and implements measures to mitigate the risk and monitor any residual risk. The Risk Map is appended to the ICAAP which is formally approved by the Board of Directors. It is reviewed on a quarterly basis by the Firm’s executive management committee.

Regulatory Capital

The Firm's Capital Resources Requirement ("CRR") Pillar 1 calculation, as a Limited Licence Firm, is its Fixed Overheads Requirement (£1,004,000), which is higher than its base capital requirement (€50,000) or the Market Risk (£12,000) and Credit Risk (£225,000) combined.

Pillar 2 capital is calculated by the Firm as representing any additional capital to be maintained against risks not adequately covered under the requirement in Pillar 1 as part of its ICAAP.

Having performed the ICAAP, the Firm has concluded that no additional capital is required in excess of its Pillar 1 capital requirement. The firm currently holds £1,612,190 as Tier 1 capital to meet its CRR. The firm considers this amount to be sufficient regulatory capital to support the business and has not identified any areas which give rise to a requirement to hold additional risk-based capital.

The Firm’s ICAAP is reviewed by the Finance, Audit and Risk Committee annually, but will be revised in the event of any material changes to the Firm’s business or risk profile.

Financial Position of the Firm at 31st December 2021

Having generated a profit after tax for the year of £131,653 (2020: £159,926), the Firm had net assets amounting to £1,612,190 (2020: £1,780,537) as at 31 December 2021 and a strong cash position. As a result of the strong financial position of the Firm the Board of Directors declared an interim dividend of £300,000 during the year which was paid in December 2021.

The Board of Directors are satisfied with the financial position of the Firm at the year end and expect sound financial performance in the future.

Remuneration

The disclosures below are in accordance with the Financial Conduct Authority ("FCA") Handbook for Banks, Building Societies and Investment Firms ("BIPRU"). The rules included within BIPRU 11 set out the provision for Pillar 3 disclosure. This document includes information required to be disclosed by the Firm in order to meet such obligations.

As defined by the Remuneration Code (SYSC 19c) and Pillar 3 disclosures (BIPRU), the Firm is a proportionality level 3 Remuneration Code Firm and as such this disclosure is made in line with the requirements of a level 3 firm.

The following disclosures are required on at least an annual basis regarding the Firm's remuneration policy for those categories of staff whose professional activities have a material impact on client portfolios.

Due to the size and nature of the Firm, an independent remuneration committee was deemed unnecessary and therefore the senior management of the Firm in consultation with the Chairman, Deputy Chairman and a non-executive director are the governing body responsible for reviewing and implementing the remuneration policy.

The Firm's policy is to remunerate staff with competitive salaries for the roles they perform. Any variable remuneration is based on performance of duties carried out during the year and the overall performance of the Firm.

Based on the Firm's profile, the Firm considers there to be only one business area within the Firm, which is Investment Management. The Firm had 6 Code Staff during 2021, being the Executive Directors and senior personnel whose roles impact client portfolios. For the year ended 31 December 2021 the total aggregate remuneration awarded to Code Staff was £1,927,511.

Stewardship Disclosure

The Firm supports the principles enshrined in the Financial Reporting Council's Stewardship Code which sets out good practice for investor engagement. The FCA requires all authorised asset managers to publicly disclose either a statement of compliance with the Stewardship Code or, where they do not comply, their alternative investment strategy.

The Financial Conduct Authority and the Financial Reporting Council have acknowledged that certain aspects of the Stewardship Code are not directly relevant to all managers. The Firm is a fund manager which invests mainly in funds. Consequently, compliance with the Stewardship Code is not applicable to the Firm because it manages or advises on UK listed companies for investors on an infrequent basis and there is no interaction with the management of companies with respect to those direct holdings managed or advised by the Firm.

The Firm’s Board of Directors will continue to review the Code's applicability. 

The Strategic Report was approved by the Board and signed on its behalf by:

The directors present their annual report and financial statements for the year ended 31 December 2021.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The results for the year are set out on page 12.

Saffery Champness LLP have expressed their willingness to continue in office.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

We have audited the financial statements of Windmill Hill Asset Management Limited (the 'company') for the year ended 31 December 2021 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

•     give a true and fair view of the state of the company's affairs as at 31 December 2021 and of its profit for the year then ended;

•     have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

•     have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

•     adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

•     the financial statements are not in agreement with the accounting records and returns; or

•     certain disclosures of remuneration specified by law are not made; or

•     we have not received all the information and explanations we require for our audit; or

•     the directors were not entitled to take advantage of the small companies’ exemptions from the requirement to prepare a strategic Report and in preparing the directors’ Report.

As explained more fully in the directors' responsibilities statement set out on page 7, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.

Identifying and assessing risks related to irregularities:

We assessed the susceptibility of the company’s financial statements to material misstatement and how fraud might occur, including through discussions with the directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the company by discussions with directors and updating our understanding of the sector in which the company operates.

Laws and regulations of direct significance in the context of the company include The Companies Act 2006, FCA regulation and UK Tax legislation.

Audit response to risks identified:

We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the company’s records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the company’s policies and procedures for compliance with laws and regulations with members of management responsible for compliance.

During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

The income statement has been prepared on the basis that all operations are continuing operations.

Windmill Hill Asset Management Limited is a private company limited by shares incorporated in England and Wales. The registered office is Windmill Hill, Silk Street, Waddesdon, Aylesbury, Bucks, HP18 0JZ.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover represents amounts receivable in respect of investment management and advisory services rendered to customers net of VAT.

Turnover from investment management and advisory services is recognised in the same period as the services were performed.

Other revenue is recognised on an accruals basis.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest rate method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Basic financial liabilities, including trade and other creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as 'creditors: amounts falling due within one year' if payment is due within one year or less. If not, they are presented as 'creditors: amounts falling due after more than one year'. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest rate method.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company are recorded at the value of the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are neither taxable nor deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Where items recognised in other comprehensive income or equity are chargeable to or deductible for tax purposes, the resulting current or deferred tax expense or income is presented in the same component of comprehensive income or equity as the transaction or other event that resulted in the tax expense or income. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

There are no estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities.

An analysis of the company's turnover is as follows:

The total turnover of the company for the year has been derived solely from its principal activity wholly undertaken in the United Kingdom.

The average monthly number of persons employed by the company during the year was:

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

On 24 November 2021 the company declared a dividend of £0.75 per non-voting ordinary share.

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

The company makes contributions to employees' defined contribution pension schemes on a defined contribution basis.

The company has in issue 46,875 Voting Ordinary shares which carry the right to vote in any circumstances.

The company has in issue 400,000 Non-Voting Ordinary shares which do not carry the right to attend, speak or vote at a General Meeting of the company, unless it relates to the liquidation of the company. Each Non-Voting Ordinary share is entitled pari passu to dividend payments or any other distribution. Each share is entitled pari passu to participate in a distribution arising from a winding up of the company.

The company has in issue 1 Board Appointment share which carries the right to vote only in specific circumstances in relation to directorships.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The remuneration of key management personnel, who are also directors, is as follows:

During the year the company charged £8,203,985 (2020: £6,131,680) for investment management and administrative services (including performance fees) to entities in which certain directors of the company served as either a director, trustee or had a beneficial interest. During the year the company was also charged £1,520,534 (2020: £1,909,408) for investment, property and administrative services by these entities. These transactions were carried out on arms length terms in the normal course of business.

At 31 December 2021 the company was owed £1,893,754 (2020: £1,950,559) by these entities. At 31 December 2021 the company owed £28,930 (2020: £21,212) to these entities. The related party balances are inclusive of accrued income and expenditure.

The directors do not consider there to be any one controlling party of the company.