NEWTON_DOWN_WIND_HOLDCO_L - Accounts

The directors present their annual report and audited financial statements of Newton Down Wind Holdco Limited (the "Company") for the year ended 30 June 2023. The comparative is a shorter period of 6 months, due to a change in the prior year of the Company's accounting reference date to align with other entities within the Bluefield Solar Income Fund ("the Group").

The principal activity of the Company is to own special purpose vehicles which own and operate wind PV assets to generate income through the sale of electricity and receipt of government subsidies.

Country of incorporation and legal form of the entity

Newton Down Wind Holdco Limited was incorporated as a private Company, limited by shares, under the Registrar of Companies for England and Wales on 24 May 2017.

Risk management and Control

In the ordinary course of business, the Company is exposed to and manages a variety of risks in relation to its activities, including financial risk. The management of credit, interest rate, liquidity and portfolio operational risks are fundamental to the Company, with the Board of directors having responsibility for the overall system of internal control and for reviewing its effectiveness.

The key areas of risk in relation to the use of financial statements are listed below and are properly addressed by the management of the Company:

Interest risk: Fluctuations in the prevailing levels of market rates of interest pose a risk to the Company's financial position and cash flow. This is not considered a significant risk to the Company as the interest on loans owed to group undertakings is charged at a rate agreed by the parent company and are not subject to interest movements in the market.

Liquidity risk: Failure to meet financial obligations in a timely and cost effective manner due to mismatches in the maturity profile of assets and liabilities. The Company does not operate or own a bank account but manages its financial obligations and future cash commitments via its borrowings from fellow group undertakings.

Portfolio operation risk: The Directors consider that the principal risks impacting the Company relate to portfolio operation, management and reporting. The risks associated with the underperformance of the portfolio are mitigated through the asset management activities of Bluefield Services Limited who send weekly, monthly and annual reports highlighting the operational status of the portfolio as well as engaging with contractors to ensure technical issues are resolved promptly. Reporting risks, which principally cover possible valuation discrepancies (details of which are highlighted in note 9), are mitigated through work performed by the Group's Investment Adviser, who is an active participant within the UK wind market.

Russia/Ukraine conflict risk: The directors are continuously monitoring the impact, if any, that the ongoing conflict in Ukraine may have on the entity and the impact on energy prices across the portfolio. The Company has no direct exposure to either Ukraine or Russia.

The loss for the year, after taxation, amounted to £3,219,764 (2022 - £2,907,116 profit).

No dividends were distributed in the current year or prior period.

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

Qualifying third party indemnity provisions

The Company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

There have been no significant events affecting the Company since the year end.

KPMG Channel Islands Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.

Under company law the directors 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 Company and of the profit or loss of the Company for that period. In preparing these financial statements, the directors 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 UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

•     assess the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and

•     use the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

The directors are responsible for keeping adequate accounting records that are sufficient to show the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.

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.

In preparing the financial statements, the directors have taken advantage of section 414B of the Companies Act 2006 and have not prepared a Strategic Report.

We have audited the financial statements of Newton Down Wind Holdco Limited (the “Company”), which comprise the statement of financial position as at 30 June 2023, the statements of comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information.

In our opinion, the accompanying financial statements:

•     give a true and fair view of the state of the Company's affairs as at 30 June 2023 and of the Company's loss for the year then ended;

•     are properly prepared in accordance with United Kingdom accounting standards, including FRS 102 The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland; 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 are described below. We have fulfilled our ethical responsibilities under, and are independent of the Company in accordance with, UK ethical requirements including FRC Ethical Standards. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.

Going concern

The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Company or to cease its operations, and as they have concluded that the Company's financial position means that this is realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt over its ability to continue as a going concern for at least a year from the date of approval of the financial statements (the “going concern period").

In our evaluation of the directors' conclusions, we considered the inherent risks to the Company's business model and analysed how those risks might affect the Company's financial resources or ability to continue operations over the going concern period.

Our conclusions based on this work:

• we consider that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate; and

• we have not identified, and concur with the directors' assessment that there is not, a material uncertainty related to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for the going concern period.

However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Company will continue in operation.

Fraud and breaches of laws and regulations – ability to detect

Identifying and responding to risks of material misstatement due to fraud

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

•     enquiring of management as to the Company’s policies and procedures to prevent and detect fraud as well as enquiring whether management have knowledge of any actual, suspected or alleged fraud;

•     reading minutes of meetings of those charged with governance; and

•     using analytical procedures to identify any unusual or unexpected relationships.

As required by auditing standards, and taking into account possible incentives or pressures to misstate performance and our overall knowledge of the control environment, we perform procedures to address the risk of management override of controls, in particular the risk that management may be in a position to make inappropriate accounting entries, and the risk of bias in accounting estimates such as valuation of unquoted investments. On this audit we do not believe there is a fraud risk related to revenue recognition because the Company’s revenue streams are simple in nature with respect to accounting policy choice, and are easily verifiable to external data sources or agreements with little or no requirement for estimation from management. We did not identify any additional fraud risks.

We performed procedures including:

•     i

•     incorporating an element of unpredictability in our audit procedures; and

•     assessing significant accounting estimates for bias.

Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general sector experience and through discussion with management (as required by auditing standards), and discussed with management the policies and procedures regarding compliance with laws and regulations.

The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

The Company is subject to other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of litigation or impacts on the Company’s ability to operate. We identified company law as being the area most likely to have such an effect. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of management and inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.

Context of the ability of the audit to detect fraud or breaches of law or regulation

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.

In addition, as with any audit, there remains a higher risk of non-detection of fraud, as this may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

The directors' report

The directors are responsible for the directors' report. Our opinion on the financial statements does not cover that report and we do not express an audit opinion thereon.

Our responsibility is to read the directors' report and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work:

• we have not identified material misstatements in the directors' report;

• in our opinion the information given in that report for the financial year is consistent with the financial statements; and

• in our opinion that report has been prepared in accordance with the Companies Act 2006.

Under the Companies Act 2006, we are required 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 directors’ 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 exemption from the requirement to prepare a strategic report

We have nothing to report in these respects.

As explained more fully in their statement set out on page 2, the directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; 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 they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

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 our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditorsresponsibilities.

The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the Company's member, 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 member 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 its member, as a body, for our audit work, for this report, or for the opinions we have formed.

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

The notes on pages 12 to 21 form part of these financial statements.

The notes on pages 12 to 21 form part of these financial statements.

The notes on pages 12 to 21 form part of these financial statements.

The notes on pages 12 to 21 form part of these financial statements.

Newton Down Wind Holdco Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1010 Eskdale Road, Winnersh Triangle, Wokingham, Berkshire, United Kingdom, RG41 5TS.

The principal activity of the Company is to own special purpose vehicles which own and operate wind PV assets to generate income through the sale of electricity and receipt of government subsidies.

The directors present a full year from 1 July 2022 to 30 June 2023. The comparative period was for the 6 months to 30 June 2022, following a change of year end to align with other entities in the Bluefield Solar Income Fund Limited group ("the Group"). As such, the comparatives may not be entirely comparable.

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, modified to include the revaluation of certain financial instruments at fair value. The principal accounting policies adopted are set out below.

The directors have concluded that the Company’s subsidiaries should be excluded from consolidation as the interests in subsidiaries are held as part of an investment portfolio, as defined in paragraph 9.9 (b) of FRS 102 and are measured at fair value with movements in fair value recognised in the Statement of Comprehensive Income in the year in which they arise.

These accounts have been prepared on a going concern basis although the Company is in a net current liability position. The directors believe this basis is appropriate following the consideration of cashflow forecasts which show the Company is able to meet its liabilities as they fall due for at least 12 months from the date of approval of these financial statements.

At the year end, the Company reported net current liabilities of £7,690,434 (2022: £8,367,833), as a result of an intra-group loan (see in note 12).

The directors have considered the impact which the current conflict in Ukraine could have on the Company. In their view, as the Company has no direct exposure to Ukraine or Russia, the directors do not expect a significant impact on revenue and cash flows of the Company arising from the conflict.

Should any unforeseen circumstances require additional funding, the Company has obtained written confirmation from its intermediate parent that it would provide financial support to meet the Company's liabilities for a period of at least 12 months from the date the financial statements are approved.

Consultancy services fee income is recognised on an accrual basis.

The Company has entered into consultancy agreements with its SPV for the provision of on-going ad-hoc advisory services in the management, administration and operation of its SPV. The consultancy services fee income is charged according to plant capacity and agreed from time to time between Newton Down Wind Holdco Limited and its SPV.

The directors have assessed the position of the Company and are of the opinion that the Company should exclude all subsidiaries from consolidation on the grounds set out in FRS 102 paragraph 9.9.

Consequently, the investments held as part of an investment portfolio are measured at fair value through profit or loss, with changes in fair value recognised in Statement of Comprehensive Income.

A subsidiary is an entity controlled by the Company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

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, unless otherwise detailed below.

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 debtors, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest 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. Financial assets classified as receivable within one year are not amortised.

Classification

The Company has been classified as an investment entity and as such its investments in any subsidiaries are held at fair value through profit or loss and measured in accordance with the requirements of FRS 102 (see note 2).

Recognition

Investments made by the Company in its subsidiaries are initially recognised at transaction price on the day the investment is made. Transaction costs arising from the acquisition of the investments that are recurring in nature and that would not be expected to be recovered on a subsequent sale of the investment (such as legal fees relating to due diligence and technical reviews of the wind or solar farms) are expensed to the Statement of Comprehensive Income. However, transaction costs intrinsically linked to the value of the investments (such as legal fees relating to the contract on the construction and maintenance of wind or solar assets, stamp duty costs relating to the leases on the wind or solar farms, insurance during construction and technical due diligence on construction) are included in the cost of the financial assets held at fair value through profit or loss.

Measurement

Subsequent to initial recognition, investments in subsidiaries are measured at each subsequent reporting date at fair value. Gains and losses resulting from the revaluation of investments are recognised in the Statement of Comprehensive Income. The Company has elected to recognise all gains and losses from financial assets held at fair value through profit or loss as a single line in the Statement of Comprehensive Income. Fair value is determined on an unleveraged, discounted cash- flow basis in accordance with The International Private Equity and Venture Capital ("IPEV') Valuation Guidelines recognising any other assets and liabilities of the subsidiary.

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 statement of comprehensive income.

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 statement of comprehensive income.

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.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors and loans from fellow group undertakings, 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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 proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

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 statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or 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. Deferred tax is charged or credited in the statement of comprehensive income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. 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.

Loans

Non-derivative financial liabilities with fixed or determinable repayments that are not quoted in an active market are classified as loans. Loans are initially recognised at fair value of the consideration received plus directly related transaction costs. They are subsequently measured at amortised cost using the effective interest method. Arrangement fees and interest payable on financial liabilities that are classified as loans, are charged to the statement of comprehensive income.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating the interest payable over the expected life of the liability. The effective interest rate is the rate that exactly discounts estimated future cashflows to the instrument's initial carrying amount. Calculation of the effective interest rate takes into account fees payable, that are an integral part of the instrument yield and transaction costs. All contractual terms of a financial instrument are considered when estimating future cash flows.

A financial liability is removed from the statement of financial position when the obligation is discharged, or cancelled, or expires.

Interest payable and similar expenses

Interest payable and similar expenses are charged to the Statement of Comprehensive Income over the term of the debt so that the amount charged is at a constant rate on the carrying amount. Interest payable and similar expenses include issue costs, which are initially recognised as a reduction in the proceeds of the associated capital instrument.

The preparation of the financial statements under FRS 102 requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The area involving a high degree of judgement or complexity or area where assumptions and estimates are significant to the financial statements has been identified as the risk of misstatement of the valuation of the SPV investments (see note 9).

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.

In preparing these financial statements, the directors have made the following judgements and estimates:

• Going concern - refer to accounting policy 1.3.

• The Board has determined that the Company shall exclude all subsidiaries from consolidation in accordance with FRS 102 paragraph 9.9(b) 'Subsidiaries are held as part of an investment portfolio' as detailed in accounting policy 1.5. This determination involves a degree of judgement due to the complexity within the wider structure of the Group and the investments in the SPVs and the Company's purpose to invest funds solely to return from capital appreciation and investment income. Additionally, as the investment in the SPVs consist of both debt and equity investments, judgement has been applied to the unit of account for the measurement of these investments.

• Financial assets held at fair value through profit or loss - The area involving high degree of judgement or complexity or area where assumptions and estimates are significant to the financial statements has been identified as the risk of misstatement of the value of the SPV investments (see note 9). Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future period affected.

• An assessment of the possible impairment of assets takes place biannually, whereby the directors calculate the fair value on a discounted cash flow basis in accordance with IPEV Valuation Guidelines. This value is then compared to that within the financial statements at which point, if there are signs of impairment, this is then accounted for.

All turnover arose within the United Kingdom from consultancy services in the current year and prior period.

The Company had no employees (2022 - Nil) other than its directors who did not receive any remuneration (2022 - Nil).

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

An increase in the rate of corporation tax from 19% to 25% became effective from 1 April 2023, from the previous rate of 19%.This will impact the Company's future tax charges accordingly.

At the reporting date, the Company had no unused tax losses carried forward (2022: Nil).

The directors base the fair value of the investments in the SPVs held by the Company on information received from the Group's Investment Adviser. Fair value is calculated on discounted cash-flow basis in accordance with the IPEV Valuation Guidelines. The Group's Investment Adviser produces fair value calculations on a semi-annual basis as at 30 June and 31 December each year.

Plants under construction and not yet operational are valued at cost and exclude acquisition costs which are expensed in the period in which they are incurred, whilst investments that are operational are valued on a discounted cash flow ("DCF") basis over the life of the asset (typically more than 25 years) and, under the ‘willing buyer-willing seller’ methodology, prudently benchmarked on a £/MWp basis against comparable transactions for large scale portfolios. The same valuation methodology and process for operational assets is followed in these financial statements as was applied in the preparation of the Company’s financial statements for the period ended 30 June 2022.

Each investment is subject to full UK corporate taxation at the prevailing rate with the tax shield being limited to the applicable capital allowances from the Company's SPV investments.

The key inputs to a DCF based approach are: the equity discount rate, the cost of debt (influenced by interest rate, gearing level and length of debt), power price forecasts, long term inflation rates, asset life, operational costs and taxation.

Given discount rates are a product of not only the factors listed previously but also regulatory support, perceived sector risk and competitive tensions, it is not unusual for discount rates to change over time. Evidence of this is shown by way of the revisions to the original discount rates applied between the first UK wind investments and those witnessed in the past twelve months.

Given discount rates are subjective, there is sensitivity within these to the interpretation of factors outlined above.

Judgement is used by the Board in determining the weighted average discount rate of 8% (2022 - 6.75%) as at 30 June 2023 with four key factors that have impacted the adoption of this rate outlined below:

• Transaction values have remained consistent at c.£1.20-1.45/MW for large scale wind portfolios, which the Board have used to determine that an effective price of £1.35m/MW is an appropriate basis for the valuation of the BSIF portfolio as at 30 June 2023;

• Inclusion of the latest long term power forecasts from the Company’s three providers;

• Increase of inflation assumptions;

• Increase in the cost of debt.

In order to smooth the sensitivity of the valuation to forecast timing or opinion taken by a single forecast, the Board continues to adopt the application of a blended power curve from three leading forecasters.

It is only the SPVs of the Company and their intermediate holding companies that the directors fair value. Fair value of operational SPVs is calculated on a discounted cash flow basis in accordance with the IPEV Valuation Guidelines.

Details of the Company's subsidiaries at 30 June 2023 are as follows:

Included within amounts owed to group undertakings are secured debts of £7,675,501 (2022: £8,349,828). The loans are repayable on demand and bear interest at 7.8% per annum (2022: 7%), which compounds annually on 30 June.

Bayerische Landesbank as Security Trustee for the Secured Parties (Security Trustee) holds fixed and floating charges dated 6 July 2017 covering all the property or undertaking of the company, the outstanding charge contains a negative pledge.

Financial assets measured at amortised cost comprise trade and other debtors.

Financial assets measured at fair value through profit or loss comprise investments in group undertakings.

Financial liabilities measured at amortised cost comprise trade creditors, amounts owed to group undertakings and accruals.

The Company has one class of Ordinary share, which has attached to it full voting, dividend and capital distribution rights (including on a winding up). The share does not confer any rights of redemption.

There have been no significant events affecting the Company since the year end.

The Company has taken advantage of the exemption under FRS102. s 33.1A not to disclose transactions entered between wholly owned members of the same group.

At 30 June 2023, the immediate parent company was New Road Solar Limited registered at 2nd Floor, 2 City Place, Beehive Ring Road, Gatwick, West Sussex, England, RH6 0PA.

The ultimate parent company and controlling party is Bluefield Solar Income Fund Limited, which is incorporated in Guernsey.

The Company did not operate a bank account in the current year or prior period.