Lindisfarne Partners LLP - LLP accounts 22.3

REGISTERED NUMBER: OC346898 (England and Wales)

Report of the Members and

Financial Statements

for the Year Ended 31 March 2023

for

Lindisfarne Partners LLP

Page

General Information

1

Report of the Members

2

Report of the Independent Auditors

4

Statement of Comprehensive Income

8

Balance Sheet

9

Reconciliation of Members' Interests

10

Cash Flow Statement

12

Notes to the Financial Statements

13

DESIGNATED MEMBERS:

W J Beckwith

A Hogarth

P B Baker

REGISTERED OFFICE:

181 Queen Victoria Street

London

EC4V 4EG

REGISTERED NUMBER:

OC346898 (England and Wales)

AUDITORS:

Anstey Bond LLP

Statutory Auditors &

Chartered Accountants

1 Charterhouse Mews

London

EC1M 6BB

The members present their report with the financial statements of the LLP for the year ended 31 March 2023.

PRINCIPAL ACTIVITY

The principal activity of the LLP in the year under review was that of providing fixed income capital markets services. As of 1 April 2014, the LLP became registered as authorised and regulated by the Financial Conduct Authority (FCA) in its own right, with the firm registration number 583157.

DESIGNATED MEMBERS

The designated members during the year under review were:

W J Beckwith

A Hogarth

P B Baker

RESULTS FOR THE YEAR AND ALLOCATION TO MEMBERS

The profit for the year before members' remuneration and profit shares was £942,861 (2022 - £1,127,623 profit).

MEMBERS' INTERESTS

The members participate in the profits and losses of the LLP in the proportions set out in the agreement between the members.

Members receive drawings by way of regular monthly payments that take into account the need to maintain sufficient funds to finance working capital and other needs of the business. These drawings are treated as a reduction in the balance due to members. The final division of profits to members is made at the Balance Sheet date.

STATEMENT OF MEMBERS' RESPONSIBILITIES

The members are responsible for preparing the Report of the Members and the financial statements in accordance with applicable law and regulations.

Legislation applicable to limited liability partnerships requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under legislation applicable to limited liability partnerships the members must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the LLP and of the profit or loss of the LLP for that period. In preparing these financial statements, the members are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.

The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and enable them to ensure that the financial statements comply with the Companies Act 2006 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. They are also responsible for safeguarding the assets of the LLP and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the members are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the LLP's auditors are unaware, and each member has taken all the steps that he ought to have taken as a member in order to make himself aware of any relevant audit information and to establish that the LLP's auditors are aware of that information.

AUDITORS

The auditors, Anstey Bond LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE MEMBERS:

A Hogarth - Designated member

19 July 2023

Opinion

We have audited the financial statements of Lindisfarne Partners LLP (the 'LLP') for the year ended 31 March 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Reconciliation of Members' Interests, Cash Flow Statement and Notes to the Financial Statements, including a summary of 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 LLP's affairs as at 31 March 2023 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 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008.

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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the LLP 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 members' 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 LLP'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 members with respect to going concern are described in the relevant sections of this report.

Other information

The members are responsible for the other information. The other information comprises the information in the Report of the Members, but does not include the financial statements and our Report of the Auditors 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.

In connection with our audit of the financial statements, 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 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.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 as applied to LLPs 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

-	we have not received all the information and explanations we require for our audit.

Responsibilities of members

As explained more fully in the Statement of Members' Responsibilities set out on page two, the members 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 members determine 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 members are responsible for assessing the LLP'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 members either intend to liquidate the LLP or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors 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.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

- the nature of the industry and sector, control environment and business performance including the design of the LLP's remuneration policies, key drivers for partners' remuneration, bonus levels and performance targets;

- results of our enquiries of management about their own identification and assessment of the risks of irregularities;

- any matters we identified having obtained and reviewed the LLP's documentation of their policies and procedures relating to:

- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

- the matters discussed among the audit engagement team and involving relevant internal specialists, including tax and IT specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in relation to revenue deferrals. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the LLP operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in the context included the UK Companies Act as applied to LLPs and local tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the LLP's ability to operate or to avoid a material penalty. These included compliance with Financial Conduct Authority regulation for the UK operating segment and compliance with local legislation for the overseas operating segments.

Audit response to the risks identified

Our procedures to respond to risks identified included the following:

- reviewing the financial statement disclosures and verifying through obtaining supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

- enquiring of management and external legal counsel concerning actual and potential litigation and claims;

- performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

- reading minutes of meetings of those charged with governance, and reviewing regulatory correspondence with the Financial Conduct Authority;

- obtained an understanding of provisions and held discussions with management to understand the basis of recognition or non-recognition of tax provisions; and

- in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members including internal specialists and significant component audit teams, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the LLP's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the LLP's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the LLP and the LLP's members as a body, for our audit work, for this report, or for the opinions we have formed.

Michael Whyke FCA (Senior Statutory Auditor)

for and on behalf of Anstey Bond LLP

Statutory Auditors &

Chartered Accountants

1 Charterhouse Mews

London

EC1M 6BB

19 July 2023

Anstey Bond LLP

1 Charterhouse Mews. London. EC1M 6BB

TURNOVER

981,575

1,172,165

Administrative expenses

(39,907

)

(44,825

)

OPERATING PROFIT

4

941,668

1,127,340

Interest receivable and similar income

1,193

283

PROFIT FOR THE FINANCIAL YEAR
BEFORE MEMBERS' REMUNERATION
AND PROFIT SHARES AVAILABLE FOR
DISCRETIONARY DIVISION AMONG
MEMBERS

942,861

1,127,623

OTHER COMPREHENSIVE INCOME

Revaluation of Investment

10,620

31,053

OTHER COMPREHENSIVE INCOME
FOR THE YEAR

10,620

31,053

TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

953,481

1,158,676

FIXED ASSETS

Investments

6

105,673

231,053

CURRENT ASSETS

Debtors

7

775,451

585,801

Cash at bank

926,914

1,644,645

1,702,365

2,230,446

CREDITORS

Amounts falling due within one year

8

(431,190

)

(810,051

)

NET CURRENT ASSETS

1,271,175

1,420,395

TOTAL ASSETS LESS CURRENT LIABILITIES

and

NET ASSETS ATTRIBUTABLE TO
MEMBERS

1,376,848

1,651,448

LOANS AND OTHER DEBTS DUE TO
MEMBERS

9

746,848

1,021,448

MEMBERS' OTHER INTERESTS

Capital accounts

630,000

1,376,848

1,651,448

TOTAL MEMBERS' INTERESTS

Loans and other debts due to members

9

746,848

1,021,448

Members' other interests

630,000

1,376,848

1,651,448

The financial statements were approved by the members of the LLP and authorised for issue on 19 July 2023 and were signed by:

A Hogarth - Designated member

EQUITY

Members' other interests

Members'

capital

(classified

as

Other

equity)

reserves

Total

£

Balance at 1 April 2022

630,000

-

630,000

Profit for the financial year available for
discretionary division among members

-

942,861

Members' interests after profit for the year

630,000

942,861

1,572,861

Other divisions of profit

-

(942,861

)

(942,861

)

Drawings on account and distributions of profit

-

Balance at 31 March 2023

630,000

-

630,000

DEBT

TOTAL

Loans and other debts due to

MEMBERS'

members less any amounts due

INTERESTS

from members in debtors

Other

amounts

Total

£

Amount due to members

1,021,448

Amount due from members

-

Balance at 1 April 2022

1,021,448

1,651,448

Profit for the financial year available for
discretionary division among members

-

942,861

Members' interests after profit for the year

1,021,448

2,594,309

Other divisions of profit

942,861

-

Drawings on account and distributions of profit

(1,217,461

)

(1,217,461

)

Amount due to members

746,848

Amount due from members

-

Balance at 31 March 2023

746,848

1,376,848

EQUITY

Members' other interests

Members'

capital

(classified

as

Other

equity)

reserves

Total

£

Balance at 1 April 2021

630,000

-

630,000

Profit for the financial year available for
discretionary division among members

-

1,127,623

Members' interests after profit for the year

630,000

1,127,623

1,757,623

Other divisions of profit

-

(1,127,623

)

(1,127,623

)

Drawings on account and distributions of profit

-

Balance at 31 March 2022

630,000

-

630,000

DEBT

TOTAL

Loans and other debts due to

MEMBERS'

members less any amounts due

INTERESTS

from members in debtors

Other

amounts

Total

£

Amount due to members

1,545,388

Amount due from members

-

Balance at 1 April 2021

1,545,388

2,175,388

Profit for the financial year available for
discretionary division among members

-

1,127,623

Members' interests after profit for the year

1,545,388

3,303,011

Other divisions of profit

1,127,623

-

Drawings on account and distributions of profit

(1,651,563

)

(1,651,563

)

Amount due to members

1,021,448

Amount due from members

-

Balance at 31 March 2022

1,021,448

1,651,448

Cash flows from operating activities

Cash generated from operations

12

373,157

1,998,436

Net cash from operating activities

373,157

1,998,436

Cash flows from investing activities

Sale of fixed asset investments

136,000

55,692

(Gain)\Loss on revaluation of investment

(10,620

)

(31,053

)

Interest received

1,193

283

Net cash from investing activities

126,573

24,922

Cash flows from financing activities

Transactions with members and former

members

Payments to members

(1,217,461

)

(1,651,563

)

Net cash from financing activities

(1,217,461

)

(1,651,563

)

(Decrease)/increase in cash and cash equivalents

(717,731

)

371,795

Cash and cash equivalents at beginning of
year

13

1,644,645

1,272,850

Cash and cash equivalents at end of year

13

926,914

1,644,645

1.	STATUTORY INFORMATION

Lindisfarne Partners LLP is registered in England and Wales. The LLP's registered number and registered office address can be found on the General Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the requirements of the Statement of Recommended Practice, Accounting by Limited Liability Partnerships. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

After reviewing the Partnerships forecasts and projects, the members have a reasonable expectation that the LLP has adequate resources to continue in operational existence for the foreseeable future. The financial statements therefore have been prepared on a Going Concern basis.

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 £.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. Income in the year relates to the following services:

2023

2022

Brokerage services

981,575

1,172,165

Revenue recognition

Broking is transacted on an arranging, execution and give-up basis. Revenue is recognised as the as the spread commission on a trade date basis.

Investment

The fixed asset investment included within the financial statement relates to a lender account being acquired. The asset is recognised at its fair value at the year end date.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Classification of share of profits in the cash flow statement

Discretionary amounts due to members in respect of their participation of rights in the profits of the LLP for the financial year are classed as equity until allocation is approved by the members. The allocation to the members of residual profits for a financial year occurs at the Balance Sheet date. A member's share in the profit or loss for the year is accounted for as an allocation of profits. Unallocated profit and losses are included within 'Other reserves'.

Drawings are included as a reduction in the balance due to members.

Allocation of profits and drawings

Discretionary amounts due to members in respect of their participation of rights in the profits of the LLP for the financial year are classed as equity until allocation is approved by the members. The allocation to the members of residual profits for a financial year occurs at the Balance Sheet date. A member's share in the profit or loss for the year is accounted for as an allocation of profits. Unallocated profit and losses are included within 'Other reserves'.

Drawings are included as a reduction in the balance due to members.

Taxation

Members are personally liable for taxation on their share of their profits. Consequently no reserve for taxation is made in these accounts.

Cash and cash equivalents

Cash and cash equivalents include cash at bank and in hand and highly liquid interest-bearing securities with maturities of three months or less. In the cash-flow statement, cash and cash equivalents are shown net of bank overdrafts, which are included as current borrowings in liabilities on the balance sheet.

Trade and other debtors

Trade and other debtors that are receivable within one year and do not constitute a financing transaction are recorded at the undiscounted amount expected to be received, net of impairment. Those that are receivable after more than one year or that constitute a financing transaction are recorded initially at fair value less transaction costs and subsequently at amortised cost, net of impairment.

Trade and other creditors

Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method unless the effect of discounting would me immaterial, in which case they are stated at cost.

3.	EMPLOYEE INFORMATION

There were no staff costs for the year ended 31 March 2023 nor for the year ended 31 March 2022.

The average number of employees during the year was NIL (2022 - NIL).

4.	OPERATING PROFIT

The operating profit is stated after charging:

31.3.23

31.3.22

£

Auditors' remuneration

6,000

5.	INFORMATION IN RELATION TO MEMBERS

31.3.23

31.3.22

£

The amount of profit attributable to the member with the largest entitlement was

746,848

1,021,448

31.3.23

31.3.22

The average number of members during the year was

4

3

6.	FIXED ASSET INVESTMENTS

Shares in

group

undertakings

£

COST OR VALUATION

At 1 April 2022

231,053

Disposals

(136,000

)

Revaluations

10,620

At 31 March 2023

105,673

NET BOOK VALUE

At 31 March 2023

105,673

At 31 March 2022

231,053

Cost or valuation at 31 March 2023 is represented by:

Shares in

group

undertakings

£

Valuation in 2022

31,053

Valuation in 2023

(25,380

)

Cost

100,000

105,673

7.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.3.23

31.3.22

£

Trade debtors

53,357

73,371

Other debtors

7,395

19,772

Prepayments and accrued income

714,699

492,658

775,451

585,801

8.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.3.23

31.3.22

£

Trade creditors

51,436

41,047

Other creditors

372,954

762,204

Accruals and deferred income

6,800

431,190

810,051

9.

LOANS AND OTHER DEBTS DUE TO MEMBERS

31.3.23

31.3.22

£

Amounts owed to members in respect of profits

746,848

1,021,448

Falling due within one year

746,848

1,021,448

10.	ULTIMATE CONTROLLING PARTY

In the opinion of the designated members of the LLP, there was neither an immediate controlling party nor an ultimate controlling party during the accounting period.

11.	RELATED PARTY DISCLOSURES

UCG Finance Limited, the appointed corporate member of the partnership, was bound by an agreement with Lindisfarne Partners LLP, dated 1 March 2020, whereby UCG Finance Limited would be a corporate partner. UCG Finance Limited had a balance of £350,000 (2022: £350,000) as equity and £280,000 (2022: £280,000) as debt.

UCG Finance Limited funds and will continue to fund the working capital of Lindisfarne Partners LLP. Lindisfarne Partners LLP records these transactions as prepayments in the balance sheet, which are recharged to UCG Finance Limited at the year end date. At the year end the amount owed to the partnership in respect of the prepayment was £687,981 (2022: £467,738). In return, UCG Finance Limited receives a profit distribution from Lindisfarne Partners LLP, this amounted to £746,604 (2022: £1,021,448).

12.	RECONCILIATION OF PROFIT FOR THE FINANCIAL YEAR BEFORE MEMBERS' REMUNERATION AND PROFIT SHARES AVAILABLE FOR DISCRETIONARY DIVISION AMONG MEMBERS TO CASH GENERATED FROM OPERATIONS

31.3.23

31.3.22

£

Profit for the financial year before members' remuneration and profit shares
available for discretionary division among members

942,861

1,127,623

Finance income

(1,193

)

(283

)

941,668

1,127,340

(Increase)/decrease in trade and other debtors

(189,650

)

509,176

(Decrease)/increase in trade and other creditors

(378,861

)

361,920

Cash generated from operations

373,157

1,998,436

13.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 March 2023

31.3.23

1.4.22

£

Cash and cash equivalents

926,914

1,644,645

Year ended 31 March 2022

31.3.22

1.4.21

£

Cash and cash equivalents

1,644,645

1,272,850

14.	ANALYSIS OF CHANGES IN NET FUNDS

Other

non-cash

At 1.4.22

Cash flow

changes

At 31.3.23

£

Net cash

Cash at bank

1,644,645

(717,731

)

926,914

1,644,645

(717,731

)

926,914

Net funds (before

members' debt)

1,644,645

(717,731

)

-

926,914

Loans and other debts

due to members

Other amounts

due to members

(1,021,448

)

1,217,461

(942,861

)

(746,848

)

Net funds

623,197

499,730

(942,861

)

180,066

15.	FCA RISK DISCLOSURES

Background

Lindisfarne Partners LLP (the "firm) is an execution only investment broker regulated by the Financial Conduct Authority's ("FCA") and subject to disclosures on its risk management policies and procedures in accordance with the Investment Firms Prudential Regime (IFPR) and MIFIDPRU regulations.

These disclosures are published on at least an annual basis and based on the position of Lindisfarne Partners LLP as at 31 March 2023, its financial year end. The disclosures are not subject to audit, except where they are equivalent to those included in the audited financial statements of the company.

Governance Framework

The firm's partners form the governing body providing oversight and take responsibility for the strategic leadership of the partnership, within a framework of good corporate governance and prudent and effective controls enabling risk to be assessed and managed.

The partners constitute the Risk Committee, though as an Execution-only broker, the firm faces reduced risks. The partners set the partnerships' strategic aims, ensuring financial and human resources are in place to meet its objectives and regularly review performance.

Lindisfarne Partners LLP is committed to encouraging equality, diversity, and inclusion among its workforce, and eliminating discrimination through policies that promote equal opportunities in the recruitment, training and development its members.

Risk management objectives

The partners of the firm assess the risks faced by the firm on an ongoing basis through its Internal Capital Adequacy and Risk Assessment (ICARA) process, with the aim to operate a defined and transparent risk management framework. These policies and procedures are updated as required

The firm has identified the material risk types to which it is exposed as follows:

Operational Risk

Operational risk is the risk of loss resulting from internal processes which are inadequate or have failed due to human errors, system failures, or external events. The firm is exposed to operational risk within its core business, with the loss of key staff identified as having potential to negatively impact the firm's financial activity and performance.

The firm seeks to manage and mitigate operational risk through continuously improving processes and control, regular internal reporting and encouraging a positive and proactive management and operational risk culture.

Business Risk

Business risk encompasses the exposure to uncertainty in wider economic and competitive environment and the impact on the firm's ability to carry out its stated business plan. The risk is managed with a long-term focus, assisted by appropriate management oversight to maintain high investment performance and trade execution levels for clients.

Concentration Risk

The firm has longstanding and strong relationships with its clients and does not have any direct exposure to a single client or group of connected clients.

Liquidity risk

The risk that the firm is unable to meet its liabilities as they fall due. To manage this risk the firm maintains a surplus of liquidity resources sufficient to meet current operational requirements that can be prudently foreseen as well as reasonable unexpected events on cost effective terms. The firm has resources in excess of its fixed overhead requirements.

Capital Adequacy

The firm conducts ongoing reviews of its internal systems and controls to ensure it maintains adequate financial resources to manage and mitigate the identified risks that may result in material harm or result in the winding down of the business. This assessment is performed through daily capital adequacy calculations and its Internal Capital Adequacy and Risk Assessment (ICARA) process.

All capital requirements were met during the year under review

Own Funds Requirement

Lindisfarne Partners LLP regularly assesses its internal capital to ensure it meets the ongoing needs of the firm whilst maintaining a strong capital base to accommodate future developments in the business. At all times the firm ensures that it satisfies the MIFIDPRU 3 requirements that its total Own Funds are greater than 100% of its Own Funds Requirement as laid out under MIFIDPRU 4.3

The firms' own funds requirement for period ending 31 March 2023 was the greater of:

- Permanent minimum capital requirement of £190,000

- Its calculated fixed overhead requirement of £96,000

- K-factor (only K-COH applies) requirement of £30,000

At the date of the financial statements the firm had total own funds of £630,000 comfortably exceeding its baseline requirements. A reconciliation of the firms' total own funds to the financial statements is as follows:

Total Own Funds

£

Common Equity Tier 1 Capital

350,000

Additional Tier 1 Capital

-

Tier 2 Capital

-

Tier 3 Capital

280,000

Total Own Funds

630,000

Loans and other debts due to members

746,605

Members capital accounts

630,000

Amounts due from members

-

Total Members Interests per Financial Statements

1,376,605

Lindisfarne Partners LLP's own funds are comprised only of Common Equity Tier 1 items with no deductions from capital.

Further Enquiries

Arthur Hogarth - Head of Compliance

Or Paul Baker

Lindisfarne Partners LLP

6 Snow Hill

London

EC1A 2AY