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The Babraham Institute (A Charitable Company Limited by Guarantee)

Annual Report and Financial Statements

Year Ended

31 March 2023

Company Number 03011737

Charity Number 1053902

THE BABRAHAM INSTITUTE

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

PAGE: ANNUAL REPORT

2 Officers and professional advisers 3 Report of the trustees (incorporating the Strategic Report)

PAGE: FINANCIAL STATEMENTS

28 Consolidated statement of financial activities 29 Balance sheets 30 Consolidated statement of cash flows 31 Notes forming part of the financial statements

THE BABRAHAM INSTITUTE

OFFICERS AND PROFESSIONAL ADVISERS

TRUSTEES	Prof Dame Linda Partridge FRS (Chair as of 1stSeptember 2023)	Prof Dame Linda Partridge FRS (Chair as of 1stSeptember 2023)
	Mr Graham Allen
	Mr Geoff Braham
	Dr James Briscoe FRS
	Prof Gordon Brown FRS
	Dr Lynne Gailey
	Prof Peter Parker FRS
	Ms Alexandra Pygall
MEMBERS	Chairman Babraham Institute Board	- Prof Dame Linda Partridge FRS
	Chairman Babraham Institute Audit Committee - Mr Geoff Braham
	UKRI-BBSRC Corporate Member	- Prof Melanie Welham
SECRETARY	Mr Simon Jones
REGISTERED OFFICE	Babraham Institute
	Babraham Hall
	Babraham
	Cambridge
	CB22 3AT
AUDITOR	Grant Thornton UK LLP
	101 Cambridge Science Park
	Milton Road
	Cambridge
	CB4 0FY
BANKERS	Lloyds Bank Plc
	4th Floor
	25 Gresham Street
	London
	EC2V 7HN
INTERNAL AUDITORS	RSM Risk Assurance Services LLP
	The Pinnacle
	170 Midsummer Boulevard
	Milton Keynes
	Buckinghamshire
	MK9 1BP
INVESTMENT BANK	Royal Bank of Canada
	100 Bishopgate
	London
	EC2N 4AA
REGISTERED COMPANY NUMBER: 03011737
CHARITY REGISTRATION NUMBER: 1053902

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

charity and its subsidiaries for the year ending 31 March 2023 which are also prepared to meet the requirements for a

The financial statements comply with the Charities Act 2011, the Companies Act 2006, the Memorandum and Articles of Association, and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

REFERENCE AND ADMINISTRATIVE DETAILS OF THE CHARITY

LEGAL STATUS

(registered charity in England and Wales number 1053902; a company limited by guarantee, registered in England and Wales number 03011737), present their report together with the audited financial statements for the year ended 31 March 2023. The charity is governed by a Memorandum and Articles of Association adopted 24 June 2011, and its Institute Grant Agreement with the Biotechnology and Biological Sciences Research Council (UKRI-BBSRC) by whom it is strategically funded. UKRI-BBSRC is part of UK Research and Innovation (UKRI), a body working in partnership with universities, research organisations, businesses, charities and government.

The charity has two trading subsidiaries: Babraham Research Campus Limited (BRCL) (Registered in England and Wales number 03241492) and Babraham Institute Enterprise Limited (BIE) (Registered in England and Wales number 06331858);

PRINCIPAL ACTIVITY

The principal activity of the group and the charitable company, as set out in the Memorandum and Articles of Association, is education, through undertaking research; the dissemination of the results of such research for the public benefit and the work on lifelong health and healthy ageing through frontier research into molecular and cell biology and development. The chief funder of the Institute is UKRI. Operating across the whole of the UK with a combined budget of more than £9 billion, UKRI became operational on 1 April 2018 and has brought together the seven Research Councils (including UKRI-BBSRC), Innovate UK and a new organisation, Research England.

BRCL operates from within the Babraham Research Campus, for which it has management and development responsibilities to ensure the Campus provides both the buildings and communal environment to benefit all the organisations on Campus. Its principal activities focus on supporting early stage companies and growing biomedical enterprises. This is delivered through the provision of specialised office and laboratory accommodation, access to scientific expertise and equipment (including to ort a researchcentric community helping translate early stage science into products and services.

managing and commercialising through partnerships with industry, licencing activities, and the formation of spin-edge scientific facilities for companies both on and off the Babraham Research Campus, thereby supporting the life science industry.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

STRUCTURE, MANAGEMENT AND GOVERNANCE

BOARD OF TRUSTEES

Up to and including the year ended 31 March 2023, the Board of Trustees consisted of up to ten individuals who acted as trustees and directors and are all guarantors of the charitable company, of an amount not exceeding £1, during the period of their appointment and for a year after resignation.

The following were members of the Board of Trustees during the year:

Prof Peter Rigby FRS resigned 1 September 2023 Mr Graham Allen Mr Geoff Braham # Dr James Briscoe FRS # Prof Gordon Brown FRS Dr Lynne Gailey # Prof Nic Jones resigned 1 September 2023 Prof Peter Parker FRS Prof Dame Linda Partridge FRS appointed 30 September 2022 Ms Alexandra Pygall #

Denotes members of the Audit Committee as at 31 March 2023.

Membership of the charity consists of two Trustee Members ( ex officio the Chair of the Board of Trustees and the Chair of the Audit Committee) and one Corporate Member, UK Research and Innovation (UKRI).

One Trustee Member, Prof Linda Partridge (who will take the position of Board Chair from September 2023) was recruited to approaches through the use of an executive recruitment agency and open application. A shortlist is compiled after review of submitted applications and shortlisted candidates are interviewed by at least the Chairman and a selection of other Trustees. Following interviews, new Trustees are appointed by the interviewing Trustees with delegated authority from the Board. Trustees are appointed for a period of up to four years from the date of appointment (usually three) and are eligible for reappointment at the end of their term. None of the Board of Trustees holds any interest in the shares of any of the subsidiary companies.

Trustees are provided with an induction pack containing key information about the Institute and are offered training in trusteeship by one of the recognised training providers in this area. Most Trustees also take the opportunity to visit the Institute and meet with its staff, outside of a formal Board of Trustees meeting.

Separate Audit Committees operate during the year for the Institute and BRCL. Additionally, a joint audit committee is convened annually to ensure proper scrutiny of Group finances and operations and as such incorporates some of the functions of a Finance and General Purposes Committee, although most of such functions are carried out by the Board itself.

The Board delegates the day to day running of the Institute to the senior management team led by Dr Simon Cook as Institute Director. Dr Cook was appointed Institute Director (3 year fixed term) in June 2022 after having been appointed Interim Director in July 2021.

The Company Secretary and Chief Op subsidiaries, Mr Derek Jones, is employed on a BRCL contract. BIE is managed by Dr Keith Jones (CEO) and senior management from the Institute.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BILITIES STATEMENT

(who are also directors of the Babraham Institute for the purposes of company law) are responsible for s. Company law requires the Trustees to prepare financial statements for each financial year.

Under that law the Trustees 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 Trustees 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 charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the charitable group for that period.

In preparing these financial statements, the Trustees are required to:

select suitable accounting policies and then apply them consistently;
observe the methods and principles in the Charities SORP (FRS 102);
make judgements and 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; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable group will continue in business.

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the statements may differ from legislation in other jurisdictions.

the Trustees have taken all the steps that they ought to have taken as Trustees in order to make themselves aware information.

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006

Institute governance dictates that key strategic decisions are made at the Babraham Executive Committee (BEC; chaired by the Director), which responds to advice from the Board of Directors, Scientific Advisory Panel and other key stakeholders including UKRI-BBSRC and other funding agencies. BEC is comprised of senior managers from across all functional areas, bringing a broad perspective of opinions to Institute business.

The Institute is committed to making a positive impact not only on the protection of the environment but to enhance it, while ensuring our research is maintained at a world-class standard. The Institute has developed a bespoke action plan for sustainability, working with UK-SOS, BRCL and eight campus companies. A Gold Award was received by the Institute by the SOSd also with BRCL companies. Continuation of this work as part of the next cycle of the Green Impact programme will achieve further environmental action with expanded participation across BRCL. The vision is that the Campus is Carbon Neutral by 2040.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006 (CONTINUED)

The Institute recognises that in order to maintain productive relationships with key stakeholders, the Institute must uphold high standards of business conduct. Operational teams hold and update relevant professional accreditations and undertake continuing personal development to ensure they are working in an effective manner. In 2020-21 a Research Integrity Steering Group was established to oversee the policies, management systems and processes supporting research integrity at the Institute. This will enable others to have confidence that our research is founded on rigour and excellence and is of the highest international quality.

The Institute has numerous mechanisms to foster relationships with key stakeholders. As the principal funder, relations with UKRI-BBSRC are maintained through many formal interactions. The Institute Director and Chair of the Board of Trustees hold regular partnership meetings with the Chief Executive of the UKRI-BBSRC. In addition, the Directors of all UKRI-BBSRC Institutes meet regularly with UKRI-BBSRC to discuss their strategic alliance. Furthermore, the Chief Operating Officer and senior members of the operations team hold frequent bilateral meetings with their counterparts at UKRI-BBSRC.

As a majority shareholder the Institute maintains close and productive relationships with BRCL management and Board. One area to highlight is in regard to environmental sustainability, where representatives from complementary functional areas, including engineering and facilities management, work collectively to reduce the impact of the campus on the local and wider environment. In addition to this, the Institute and BRCL partnered on a series of knowledge exchange networking events, coordinated a successful Collaborative Training Partnership (CTP) application and established a mentoring scheme. More details are given in the Knowledge Exchange and Commercialisation update.

Beyond the UKRI-BBSRC, the Institute is part of additional formal and informal networks. As part of the EU-LIFE alliance, a collection of independent European research institutes in the life sciences, the Institute plays a key role in building and promoting excellence in the life sciences. Institute scientists all belong to their collaborative research networks, bringing together ideas from across the globe. For grants running in 2022-2023 the Institute had collaborations with 63 organisations across 16 counties.

The Institute continues to be committed to the principles of the Modern Slavery Act 2015 and the abolition of modern slavery and human trafficking. Procurement for goods and services is provided by a wide range of suppliers and the contractual terms and conditions that the Institute puts in place with third parties are regularly reviewed and have been updated to include ely

Institute science interfaces with many key areas of policy from public health to education, and from animal welfare to big data. Our life science research has significant potential to shape and inform policy on topics such as gene editing, stem cell research and the effect of diet including animal welfare and the importance of the bioeconomy. Our researchers and staff place significant value on working with policymakers and policy organisations through discussion, evidence and debate.

In 2019, the HR department commissioned a series of three employee engagement surveys (in collaboration with The Survey Initiative). The first was launched in 2020, the second in early 2022 and the final survey is scheduled for early 2024. The surveys have helped to identify key issues and priorities for improvement, as well as highlighting areas of success, good practice and progress within the Institute.

The Institute is committed to creating, maintaining and promoting equality, diversity and inclusivity (EDI) in all aspects of its ive unites all EDI activities and regularly consults with individuals to monitor the implementation of this goal (https://www.babraham.ac.uk/about-us/e4s).

The Technician Commitment signed up to in 2019-20 to pledge action against the key challenges that affect our technical staff continues to be developed. Consultations with stakeholders identified the main objectives and a self-assessment providing contextual information about the Institute, progress to date and a detailed 24-month future action plan for embedding the Technician Commitment was developed.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006 (CONTINUED)

Implementation was extended by 12 months until January 2022 due to Covid-19 delays. Following the stakeholder consultation, a detailed action plan (www.babraham.ac.uk/people/technician-commitment) is under development for implementation from 2024, over a three year timeframe. Progress is being overseen by a Technician Commitment Steering Group. A particular success in 2022-2023 was the development of an Animal Technician Conference which was proposed and shaped by two animal technicians. Their leadership in establishing this event and supporting the goals of the Technician Commitment was recognised with an Outstanding Collaborator Award at the 2023 Research Institute Technician Awards.

The mental health and wellbeing of our staff is paramount and the Institute has a number of ways to support staff. The Employee Assistance Programme (EAP) is a 24-hour helpline for Institute staff, including financial, legal, relationship and emotional support as well as telephone counselling. In 2020 we established the Mental Health First Aider (MHFA) scheme, recruiting volunteers from across the Institute to be trained up as Mental Health First Aiders to act as a first point of contact for staff who are experiencing a mental health issue or emotional distress and to help signpost staff to the appropriate support. Additionally (in 2020) we introduced the Access to Work Mental Health Support service delivered by Remploy which provides support to individuals who are experiencing difficulties at work due to depression, anxiety, stress and/or other mental health conditions. Since the pandemic we have significantly improved our wellbeing offering to staff and have run a number of wellbeing and mental health related webinars and provided staff with monthly wellbeing themes and related resources. In addition, in 2022 we commenced an annual calendar of wellbeing events including collaborative activities with the Green Labs strategic initiative, for example cycle to work initiatives. Also, in 2022 we launched the first phase of Babraham ers for staff, thus assisting with financial wellbeing particularly during the cost of living crisis. The platform also contains a wealth of wellbeing information and support benefits provision, thus providing easy and quick access to the benefits available. The second phase, salary sacrifice schemes was launched in August 2023, by the introduction cheme.

OBJECTIVES AND ACTIVITIES

INSTITUTE OBJECTIVES

In the furtherance of the charitable objectives listed in the Memorandum and Articles of Association, the charitable company - found online (www.babraham.ac.uk/about us). Information on funding, research activities, scientific facilities and wider Institute programmes such as public engagement, commercialisation and equality and diversi Annual Research Report covering 2019-2020 (www.babraham.ac.uk/our-research/annual-research-report ).

SCIENTIFIC AIMS

research operates across three science programmes (Institute Strategic Programmes, ISPs) focusing on epigenetics, signalling and immunology and is supported by UKRI-BBSRC strategic funding. The programmes work towards our overarching goal of understanding the fundamental biological mechanisms and changes underlying development and healthy ageing. Key strategic objectives include:

Understanding the interaction between the immune system and other tissues; the role of signalling pathways in the immune system as well as the effects of ageing on the immune response and vaccination.
Investigating the role of signalling pathways and the autophagy process in ageing, health and disease.
Using the epigenetic clock to investigate how life events influence biological ageing, and examining mechanisms of epigenetic inheritance, stem cell differentiation and the impact of subtle epigenetic differences on cell diversity.
Studying the impacts of diet and other lifestyle and environmental factors on epigenetics, signalling, metabolism, health and ageing.
Leveraging the capital investment in Institute infrastructure and equipment, in particular the state-of-the-art scientific facilities and biological support unit, to attract investment and interaction from both the public and private sectors.

Each ISP contains a number of research Group Leaders who adopt complementary approaches to address a common set of biological questions. In addition to existing Group Leaders, Dr Arianne Richard, joined the Immunology research programme

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

INSTITUTE OBJECTIVES (CONTINUED)

20-22 recruitment phase for new Group Leaders. In the year 2022-23 the Institute welcomed Dr Wolf Reik, Dr Adrian Liston and Dr Yiliang Ding as Honorary Group Leaders. - - - - (https://www.babraham.ac.uk/news/2023/03/yiliang ding honorary group leader)

-BBSRC in the form of Institute Strategic Programme Grants (ISPG) awarded to each programme. Each ISPG contains a list of objectives for the term of the grant, together with time plans and resource requirements; the grants are allocated for these specific, approved projects and funding may not be diverted to diverse activities. The ISPGs are summarised in the list of objectives above and a more detailed insight into the aims of each ISPG and research group can be found in the Annual Research Report (www.babraham.ac.uk/our-research/annual-researchreport ) .

Complementing ISPG funding there is a Campus Capability Grant (CCG) supporting the Institute and its core biological research facilities. The UKRI-BBSRC also provides a Knowledge Exchange and Commercialisation (KEC) grant which is used to enable the Institute to effectively disseminate knowledge and, where appropriate, facilitate partnerships or spin-out companies to maximise the impact of Institute research to translate research into action for social and economic benefit. A key part of the KEC strategy is to partner with industry, particularly biotech and pharma companies, to translate our research and support the bioeconomy. The grant also enables the Institute to employ a team of skilled KEC specialists to support and facilitate this work.

up Leader runs their own group and is expected to create, lead, maintain and develop an internationally competitive programme of innovative research. Each ISP Lead is responsible for leading and co-ordinating a cohesive programme of research that contribut uniting the goals of several groups and ensuring appropriate annual reporting to the UKRI-BBSRC.

Each Group Leader is expected to raise additional funds for their research over and above the UKRI-BBSRC core ISPG funding, not only to support the critical mass of researchers needed, but also to form strong strategic partnerships with other funders (often from the medical charity sector or the biotech/pharma industry) that are interested in the translation of Babraham Institute science into technologies and discoveries with high impact for the benefit of lifelong health and wellbeing.

The overall science direction of the Institute is determined by the Babraham Executive Committee (BEC; the senior executive committee responsible for the running of the Institute); additionally, the Science Policy Committee (SPoC; a subcommittee of BEC with additional membership from amongst the senior science staff and Grants Office) provides scientific leadership and vision and also monitors and assesses the science across all groups.

The impact of this research, for the public benefit, is a deeper understanding of the mechanisms of health and disease throughou living, wellbeing and ageing; could influence public health policies; and may underpin translational research and the creation of new therapies and treatments.

knowledge to disease conditions, often partnering with medical research charities and organisations devoted to alleviating research can be far removed from these final outcomes and there is an expectation that the translation of Institute research may take some years to come to fruition, yet over the course of its history the Institute has demonstrated its ability to deliver high-impact research advances (e.g., work on fundamental cell biology and inositol lipid signalling spanning work underpinned by discoveries made in the 1960s to current day: https://www.babraham.ac.uk/sites/default/files/media/files/babraham%20poster.pdf).

Additional first therapeutically useful monoclonal antibodies, leading to several monoclonal antibody drugs such as Herceptin (for metastatic breast cancer), i Panitumumab), licensed for the treatment of colorectal cancer, which was developed directly from research performed at the Institute more than a decade earlier.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

INSTITUTE OBJECTIVES (CONTINUED)

The results of a recent new collaboration supported by Innovate UK (part of UKRI) could lead to the identification of new anticancer drugs. In 2022, Enhanc3D Genomics Ltd, a new spin-out from the Institute, formed from genomics research undertaken by Institute Group Leaders, raised £10 million in series A funding to advance its GenLink3D[TM] proprietary technology platform, enabling genome-wide profiling to identify links between gene regulatory regions and their target genes to open up new therapeutic oppor

early 2022 on stem cells provides important research models and know-how and advances our understanding of early development with potential impact on understanding developmental disorders[1] , cellular reprogramming for personalised medicine[2] and fertility treatments[3] . Cellular reprogramming research published by the Reik lab in April 2022 received international media coverage and this work will be featured in a documentary exploring research into how to secure improved health in later years[4] . Links to the articles can be found below;

1. https://www.babraham.ac.uk/news/2022/02/new-way-study-awakening-human-genome

2. https://www.babraham.ac.uk/news/2022/03/stem-cell-secrets-allow-researchers-revamp-reprogramming

3. https://www.babraham.ac.uk/news/2021/09/key-staying-naive

4. https://www.babraham.ac.uk/news/category/news?field_keywords_target_id=341&created%5Bmin%5D=&create d%5Bmax%5D=&combine

INSTITUTE MISSION STATEMENT

To be a world-leading life science and innovation research institution producing internationally recognised and respected science with a view to creating significant social and economic impacts through understanding and improving lifelong health.
To maximise awareness, relevance and impact of our work through a diverse and creative programme of knowledge exchange, commercialisation, public engagement and communication. Particularly by building a reputation for collaboration, transparency and high-quality science and business acumen.
To provide a unique and highly successful environment, establishing Babraham Research Campus as the leading campus for bioscience start-up and developing biomedical companies and for supporting the development and growth of those organisations.

INSTITUTE REMIT

The Babraham Institute is an independent charitable life sciences Institute, strategically funded by the UKRI-BBSRC, carrying out world-leading innovative research and advanced training with relevance to the biological, biotechnological, biomedical, pharmaceutical and health research and user communities.
normal cellular processes and functions underpinning ageing, development and the maintenance of health and wellbeing.
and knowledge exchange with relevant companies and with clinical and other researchers to ensure effective application of its research.
To be an active participant of the Babraham Research Campus by supporting early-stage bioscience enterprise through collaboration and providing access to state-of-the-art equipment.

As part of the UK Science Base, the Institute contributes to the economic growth, quality of life and public engagement objectives of government. Our work supports the UKRIintegrated understanding of health. It also closely aligns with the healthcare challenge of ageing and the ambition to understand the pathways associated with multi-system ageing in order to develop new diagnostics and therapies as outlined areas.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BABRAHAM GROUP BUSINESS OBJECTIVES

International leadership
Synergistic and nationally strategic research
Collaborative partnerships
Graduate and postdoctoral training programme

Excellent fit-for-purpose infrastructure for science

Technical
Corporate
Educational

The highest standards of Corporate Social Responsibility

Values and impact of our research. The Institute holds and abides by the following values:
Benefit - We make a difference . As a world-leading centre of excellence in life sciences research we work to make discoveries for societal benefit that make a real difference in science, health and policy within the UK and globally.
Innovation - We extend the boundaries of knowledge. We work at the forefront of creative discovery science, nurturing our people through development and training, and provide the environment for innovation to thrive.
Integrity - We are open, honest, and inclusive . We work together to uphold the standards expected of us, operating with honesty and responsibility, creating an inclusive and motivating environment, and communicating openly and transparently.
Maintaining the highest standards of research integrity (for details see our Research Integrity Statement)
Community partnerships
Minimising the environmental impact of the Campus
Public Engagement Programme to engage and inspire
Openness
Inward investment to the Babraham Research Campus
Commercialisation and wealth creation
Partnerships and knowledge flow

Robust sustainability

Financial planning and estate strategy

Efficient and effective management

Operations and People

A high standard of Corporate Governance

Risk control and contingency planning
Regulatory compliance
Boards and subcommittees; executive decision-making structure and authorities

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BABRAHAM GROUP BUSINESS OBJECTIVES (CONTINUED)

Within BRCL specifically, the key business objectives are:

The delivery of research and innovation undertaken by the companies and academic researchers on the Campus.
The development of people and talent both in the academic and commercial settings.
The growth of Campus capabilities in order to support translation and company creation, and help to accelerate company growth and scale-up.
The nurturing of the ecosystem by being a vibrant, dynamic, and well-connected research and innovation location and playing an active part in that community.
Campus investment and ensuring sustainability.
The creation of new partnerships, and to sustain those we have created, with organisations both on and off the site and which have added value and contributed to the vibrancy of the Campus.

EMPLOYEES

During the year the Babraham Group has continued to provide employees with relevant information and to seek their views on matters of common concern through groups, committees, staff updates, engagement surveys and through line managers. ificant organisational changes.

Information continues to be published regularly in the Institute-wide monthly newsletter and this is now an established part of with recognition initiatives (such as Staff Recognition Awards and the Inst and updates from teams across the Institute.

These scheduled communications are supplemented with tailored communications emailed directly to staff on issues of particular note, such as changes to Institute management and important health and safety notices. Although ad hoc, these emailed communications ensure that all staff receive information that is relevant to the situation, the mechanisms for communication and support are made clear and misinformation is avoided.

th and 30th July 2022. Over the

course of two days the Institute community was honoured to host speakers and attendees who paid tribute to a thoughtful and responsive Director, a respected scientist and scientific leader, who had worked with the Institute since 2009.

A Business Continuity Plan event was held on 6[th] July 2022, bringing together departmental leads and deputies as part of a crisis management team to deal with the hypothetical scenario of a ransomware attack on the Institute. BICS computing department) were instrumental in both the development of the event and in managing the scenario on the day. The Institute also received a certificate of commendation from Cambridgeshire Fire and Rescue Service for the hosting of the th July 2022, which saw Police, Fire and Ambulance services respond to a simulated emergency on the Babraham Research Campus.

LabTalks, was held on 17[th] and 18[th] November 2022 and an Institute staff update regarding Group Leader redundancies took place on 15[th] November 2022. A UKRI-BBSRC Partnership visit was conducted on 4[th] November 2022, where Professor Welham, executive chair of BBSRC and members of the senior team visited the Institute where group leader research was showcased.

The Institute holds a Silver Athena SWAN award and is one of 164 Member organisations that currently hold Athena SWAN awards in the UK. The Athena SWAN Charter was launched in 2005 to recognise commitment to advancing women's careers in science, technology, engineering, mathematics and medicine (STEMM) employment in higher education. The awards recognise good practice in recruiting, retaining and promoting women in STEMM. The Charter believes that an organisation must have institutional support and underpinning institutional good practice, policies and procedures in place in order to achieve and sustain an award.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

EMPLOYEES (CONTINUED)

The group is aware of its statutory duty to support the employment of disabled persons where possible, both in recruitment and by retention of employees who become disabled whilst in the employment of the charity, as well as generally through training and career development. The charity is an equal opportunities employer and supports diversity in the workplace. The Institute follows the principles of .

The Institute plans to build on ongoing good practice to further progress equal opportunities. A highlight of the impacts delivered the successful establishment of a Roving Researcher position, which provides support to researchers on long-term leave in order to maintain the momentum of research projects. After being established in 2020, the position has supported 11 researchers and one science facility. There has been a high degree of interest from other organisations in how to establish similar schemes and we have given presentations on the programme.

Following a recent review, Athena SWAN status must now be renewed every five years. In addition, the Institute successfully applied for an extension to allow for delays EDI work has faced due to the pandemic and changes to our directorship over the past few years. The Institute is preparing an application for 2024.

As mentioned earlier in the Trustees Report, the Institute joined the Technician Commitment in 2019, leading to the creation of a steering group to represent the variety of technical specialist roles found across the Institute. Key areas of focus and objectives have been mapped to the Technician Commitment themes of Visibility, Recognition, Career Development and Sustainability. Progress is being made towards meeting the objectives of the 2021-23 Action Plan, with a new 3-year plan being developed for submission in early 2024.

Remuneration of key management personnel is set annually by the Senior Remuneration Committee which comprises the Institute Chair and Deputy Chair along with at least one other trustee. The Committee is chaired by the trustee appointed to oversee HR matters on behalf of the Board.

SUMMARY PUBLIC BENEFIT STATEMENT

The charitable purpose of the Institute is to advance education, specifically to increase public learning and knowledge in the field of biological and biomedical sciences and also to provide training leading to a higher degree (PhD) in research techniques and significant contribution to collective knowledge and understanding of specific areas of study and expertise. The Trustees are mindful of their collective responsibility to ensure that the charity complies with public benefit guidance issued by the Charities Commission.

ACHIEVEMENTS AND PERFORMANCE

Key performance indicators focussing on non-financial performance during the reporting year are detailed below. The choice of performance indicators is based on readily available information which provides a useful comparison of achievements this financial year to last year.

Number of publications

-section

of the public will benefit from our understanding of the ageing process and as a result of the translation of our findings into new medicines or treatments. Given the broad scope of our work, its relevance to everyone through their lifecourse, and our commitment to maximising research impacts through knowledge sharing with politicians, industry, policy organisations, charities, health and care services, we believe the Institute is making vital contributions to the future wellbeing and economy refereed research and review articles in journals, this number is expected to increase post-covid. Though only published last year these papers have already been cited almost 1,000 times.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE (CONTINUED)

A full bibliographic list of all scientific publications is available on our website (www.babraham.ac.uk/publications) and under

New Grants

The Institute, during the year, continued to seek additional external funding from various sources both within the United Kingdom, European Union and further afield. The number of new grants with a start date in 2022/23, by funding source and the total awarded, are below:

	2022/23		2021/22	2021/22	2020/21	2020/21		2019/20	2019/20
	Number		Number		Number			Number
UKRI-BBSRC	3	1,218	3	1,154	0		0	5	1,786
UKRI-MRC	1	1,418	3	1,263	2		973	2		916
European Commission	4	3,383	2	243	5	2,743		2		361
Industry, levy boards	7	544	1	295	1		420	3		457
Trusts, foundations, charities, foreigngovernments	1	137	6	4,579	5	2,370		9	1,970

As in past years, identifying, applying and securing new external funding sources remains a high priority of the Institute. Notable ry grants to Dr Peter Rugg-Gunn and Dr Della David. (https://www.babraham.ac.uk/news/2023/02/dr-della-david-and-dr-peterrugg-gunn-receive-wellcome-discovery-awards)

Public Engagement

pandemic measures. Both ourselves and our partners have been able to return to many of our historic events, as well as, launching new initi transparent and accountable organisation that is leading in its contribution of science to culture, society, economic development and growth. Public engagement at the Institute is embedded within its research and supports interactions between researchers and a variety of public groups. The Institute has a core Public Engagement Team, supporting a varied and dynamic programme to engage students, teachers, community groups, family and adult audiences. The figures below

	2022/23	2021/22	2020/21	2019/20
Visitors to site	394	0^	0^	440
Outreach Events*	33	28	12	34
Total Public Audience Engaged	3,201	3,894	2,142	2,251
Website visits	159,425	127,222	154,650	116,435

*Visits to schools, science festival exhibits, public lectures, panel sessions, public dialogue workshops, hosting community tours on campus, library talks etc, including online / digital formats.

^No visitors to site were recorded during the 2020-22 period due to the Covid-19 Pandemic.

developing relationships with communities traditionally underserved by engagement programmes. Over the last year the team have further developed relationships with a number of key partners. These include direct links with schools and community groups in areas of high deprivation - enabling these groups to engage with our research.

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ACHIEVEMENTS AND PERFORMANCE PUBLIC ENGAGEMENT (CONTINUED)

We have also linked with education sector partners such as the Youth STEMM award and T-level training providers to allow for more measurable impact and peer recognition of our work, whilst building capacity for science enrichment in nontraditional routes into science careers. Our move to operate student placements through the In2Science (further education student focussed) and In2Research (undergraduate student focussed) programmes have enabled more equitable access to research experience at the Institute and we have seen great successes in these programmes with clear impacts on participants next step career destinations. The Research Access Programme (summer placements for undergraduate students from disadvantaged backgrounds) in particular has been recognised internally and externally for its impact with the programme, with it being made a finalist for the Cambridge Independent STEM Initiative of the Year Award (with results of this being announced in May).

The schools programme has been highly successful over the last year, with the return of both the 6[th] Form Conference in autumn 2022 and Schools day in early 2023. The 6[th] Form Conference provides the opportunity for further education students to research Institute science and present this back to researchers to gain experience of work, outside of the lab, that researchers do day-to-day. Schools Day returned in a similar format to the past with almost 200 students from 28 schools across the UK visiting the Institute to take part in hands on practical projects, with almost all research groups taking part and hosting groups within their labs. Both of these events were well attended and received very positive feedback. Of note was the success in expanding the audience of these events to include relatively large numbers of students from underserved areas (areas of high deprivation as determined by the government Indices of Multiple Deprivation metric) - furthering equitable ool visits have been carried out with priority schools that have been traditionally underserved through the BioInspire programme, providing more opportunities for staff to engage students as well as building deeper relationships with these audiences. There has also been success in the community engagement programmes with a hybrid programme of in-person and online events, which re-established previous two-way engagement opportunities whilst capitalising on the learnings from online events and the extended audience reach this gives. Events such as the Cambridge Festival have showcased high tech approaches to our work through virtual reality activities, allowing for more experience led engagement. The team have also continued to engage on often controversial work such as that of the Biological Support Unit through events such as our Science Spotlight events which provide the opportunity for audiences to virtually tour the facility and see behind the otherwise closed doors. This work continues to dispel misconceptions around Institute work and contribute to our commitment to openness in animal research.

The experience gained from the ORION Open Science public dialogue is now being used in the Wellcome Funded Human Developmental Biology Index (HDBI) project. Alongside the research grant, further funding for public engagement work was successfully applied for. Using funding through the associated Wellcome Enrichment Grant and additional support through the UKRI Sciencewise programme, the team has embarked on develo views on early human developmental biology research and associated regulations, such as the 14-day limit on culturing embryos for research. This work is expected to run throughout 2023 with reporting due in the autumn. We anticipate this project will have impacts on work led by the Human Fertility and Embryology Authority around reviewing the current UK law, as well as, impacts on good practice followed by those working in the sector (in line with 2021 recommendations from the International Society for Stem Cell Research calling for meaningful public engagement around the topic).

Throughout the year public engagement work has been well received by audiences, researcher contributors, funders and peers alike. Looking ahead, the public engagement team aims to continue to develop relationships with traditionally underserved audiences and provide opportunities for high quality, two-way engagement between staff and members of the public. This will enable the team to continue as a leader in equitable engagement with traditionally underserved audiences and expertise in impactful deliberative dialogue approaches with.

Knowledge Exchange and Commercialisation (KEC)

knowledge generated by and held within the Institute. Implicit in this is the recognition that this knowledge is the product of

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REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE KEC (CONTINUED)

public investment and that the Institute has a duty to maximise outcomes from this investment for societal and economic benefit.

Activities include the training of fellow scientists in new emerging techniques, through continued professional development (CPD), engagement with the Biotech / Pharma sector and other research organisations. In addition, the Institute aims to use its expertise to inform policy, direction and understanding of science by policy makers and industrialists at home and abroad. KEC is viewed as a two-way dialogue in which the Institute engages with industry and stakeholders to listen to their concerns and try to respond to their needs. Where appropriate the Institute seeks to maximise the impact of its research through commercialisation -owned trading arm BIE.

-out, Enhanc3D Genomics Ltd has had further success, raising £10 million in Series A financing to advance its GenLink3D[TM] proprietary technology platform. A further spin-out opportunity is currently being supported for highly innovative research originating from the Immunology programme, around a platform enabling a gene delivery therapeutic that may have potential in treating a range of neuroinflammation diseases.

clinical value in diverse clinical fields including cancer therapeutics, traumatic brain injury, MS, cognitive decline, wound repair and ophthalmology, cardiovascular and chronic kidney disease. These filings are being actively developed to found spin-out opportunities or high-value licensing opportunities. A significant exclusive commercial licence for one patent family to Altos Labs UK Limited was executed in 2022, including £150k license fee and £60k patent reimbursement on signing, an annual licence fee of £25k, up to £4.25m in milestone payments, 10% of sublicence fees (reducing to 5% over 3 years) and a 1% royalty on sales (confidential information). A further industry licence currently under negotiation, resulting from KEC support of an industry-Institute collaboration that has helped the company to develop their technology platform.

On the knowledge exchange front, successful UKRI-BBSRC grants with a combined worth £350,000 were secured in 2022 and 2023, which have funded seven industry R&D research collaborations with BRCL companies and diverse cross-organisational and training and career-development opportunities for researchers and technicians. Supported collaborations and placements with industrial and institutional hosts have enabled exposure of technicians and research staff to a range of new commercial and academic environments and significantly enabled translational activities and market awareness across the three ISPs.

In 2021 the Institute and Campus successfully secured funding for fifteen PhD studentships from UKRI-BBSRC as part of a Collaborative Training Partnership (CTP). Rolling out over a period of three years, eleven different Institute research groups will host students as they undertake their PhDs in partnership with thirteen Campus companies. Each CTP student will conduct orking with one of the Campusbased companies. The close location of companies to the Institute will allow students to benefit from a high degree of interaction with their industrial partner throughout the period of their studentship. Through a tailored programme of skills training and scientific and industry supervision the partnership will produce a cohort of bioscience researchers equipped with excellent research skills and commercial know-how. Students will also shadow early-stage life science ventures as they -month bioentrepreneurial programme, Accelerate@Babraham, which will provide insight to the spin out/start-up process and an awareness of key commercial knowledge areas. Six of these studentships started in October 2022, and recruitment for a further 3 secured in January 2023.

The range of Institute initiated Campus events continued to develop in 2022-23 on diverse translational, professional career and academic themes. These activities have been significantly enhanced by the UKRI-BBSRC Campus Impact Acceleration Account (CIAA) awarded to BRCL in July 2022 and March 2023, which are being delivered in partnership with the Institute. CIAA funding is supporting BRCL-based industry collaborative R&D, financing the development of Campus-based industryfacing Facility services opportunities, translational and entrepreneurial training, Campus mentorship and networking opportunities.

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ACHIEVEMENTS AND PERFORMANCE KEC (CONTINUED)

Separate to the CIAA activities, diverse translational training opportunities have been provided by KEC to Institute staff and students through scholarships awarded to students and s EnterpriseTECH, Newton Venture Program and the BioSpark entrepreneurship programmes. Translational support has been provided to two teams who in March 2023 secured places on the Accelerate@Babraham accelerator to develop developing spin-out opportunities from the Immunology ISP and Flow Cytometry Facility. In 2022-23, Babraham Institute Enterprise Limited generated £2,320k (2022 : £1,664k) in revenues from the commercialisation of its assets and activities. Most of the

SUSTAINABILITY

only the protection

Chief Operating Officer has responsibility for environmental management.

The Institute continues to invest in energy saving opportunities exploiting funding opportunities from UKRI-BBSRC and UKRI to not only improve and reduce the carbon footprint of the Institute and its science but to maximise efficiency in its use of energy. Latest updates include:

The Institute continues to operate a Tri-generation CHP unit to meet the sites heat and cooling loads. The unit remains registered with the Department for Business, Energy and Industrial Strategy (BEIS) CHP Quality Assurance (CHPQA) Programme and good quality certification has been achieved.
Smart lighting continues to be rolled out across the Institutes building stock with the remainder of lighting within the two main laboratories upon successful funding being completed in 2023.

2022/23 Streamlined Energy and Carbon Report (SERC) outcomes - Emissions Data

----- Start of picture text -----
Greenhouse Gas Emissions 2022/23 2021/22 2020/21
Total Gross Emissions 5,597 6,317 6,503
Total Net Emissions 5,597 6,317 6,503
Gross Emissions
Scope 1 (Fuel) 4,295 5,771 5,465
Gross Emissions
Scope Emissions
Scope 1 (Transport x
Indicators (tCO2e)
100) 312 224 117
Total Scope 1
Emissions 4,606 5,996 5,582
Gross Emissions
Scope 2 (Electricity) 990 320 921
Electricity: Non-
Renewable 4,187,202 7,785,672 6,236,091
Related Energy Electricity:
Consumption (MWh) Renewable 5,121,870 1,509,387 3,254,693
Transport 12,422 8,942 4,686
Gas 23,527,186 31,509,854 29,709,938
----- End of picture text -----

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SUSTAINABILITY (CONTINUED)

Methodology

The report covers the emissions for which the Institute has financial control and this was the boundary defined by the organisation.
Utility data was collected for the past three financial years; 2020/21, 2021/22 and 2022/23 for the period 1st April to 31st March consistently.
Measurement of Scope 1 and Scope 2 emissions were based on billing data via invoices provided by the utility supplier and recorded mileage for transport emissions.
Reporting was based on the analysis of the data, to highlight any trends, progress towards reduction and recognised improvements.
An Intensity Ratio of tCO2e/Full Time Equivalent was selected by the Institute to present the data on a clear and transparent like-for-like basis.
The methodology used to compile the data was that used in the fulfilment of the regulatory requirements for the Energy Savings Opportunity Scheme (ESOS).
There are no process emissions within the organisation and emissions from air conditioning, refrigeration units in offices buildings are excluded due to cost of data collection. These are estimated to account for less than 0.2% of the total Scope 1 emissions.
Emissions factors used are those from the UK Government GHG Conversion Factors for Company Reporting Standard Set 2018.

Proposed Targets for 2023-24

The Babraham Institute continues with its ongoing water saving measures and has undertaken an internal camera inspection of a suspect section of water supply pipework. The subsequent survey report has highlighted internal cracking to several sections of the pipework that will require remedial action in the short to medium term. New Isolation valves have been installed in several areas which will help in identifying the location of any future leaks in the below ground water main.

The Route to Net Zero commissioned last year focusses on Scope 1 and Scope 2 Energy Strategy Report for the Babraham Institute and the Babraham Research Campus. The Energy Strategy Report is a high-level strategic report and feasibility study including appraisal of options for reducing energy consumption (Scopes 1 and 2), reducing reliance on fossil fuel derived energy supply across the estate, relative risks and a milestone programme for achieving Net Zero Carbon. The report also covers overall budget expectations.

In summary, the overriding objective for the Institute and BRCL is to undertake the effectively phased replacement of all existing fossil fuel energy systems with low to zero carbon systems by 2040 at the latest.

Initial actions taken from the report are;

Undertake a thermal imaging survey in 2023 as a pre-cursor to further building-level energy audits. In parallel, begin implementing energy conservation measures across the Institute while ensuring all existing system are used efficiently.
Fabric survey of all BI buildings to identify potential energy savings through improved insulation (wall and floor), improved glazing and solar shading or thermal window film.
Undertake a site-wide survey to investigate suitability of roof mounted solar arrays on Institute buildings where the local planning authority allow.

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REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

GROUP ESTATE ACTIVITIES

There are over 60 organisations operating within the Babraham Research Campus. The Campus is managed by BRCL and BRCL develops and builds facilities to support the commercial activities on site. Tenants are located in a number of purpose-built buildings with both laboratory and office space. In total, occupied space is in excess of 9,000 square meters.

This development is part of an on-going programme of expanding the campus following the initial £44m investment by HM Government in 2011. The investment programme is designed to deliver innovation from the research base, generate economic growth, and create and support new companies based on world-leading UK bioscience.

In April 2014, an additional £17m capital development project was initiated, catalysed by a further £6m grant announced by the Chancellor of the Exchequer, again to further develop the Babraham Research Campus. Under this project an additional laboratory and office building has been constructed and a new social infrastructure building has been completed and opened to campus tenants in January 2017. This latter building named The Cambridge Building now provides a new 200-seater conference facility, catering, meeting rooms and social and networking space. This reflects the needs of a growing campus, and the key role of providing space for networking for the campus tenants.

INSTITUTE FUTURE DEVELOPMENTS

The Institute will continue to be principally engaged in the field of basic bioscience with a strong emphasis on research into process from conception onwards. In preparation for the Institute Assessment Exercise, scheduled for completion in Autumn 2023, a review of the evolution and adaptation of ISPG s is taking place.

The priority is to ensure that all our UKRI-BBSRC funded research is internationally competitive with the best academic groups in our area of endeavour. We continue to prioritise the need to control costs in all categories including pay costs, but note the need to invest strategically to reach new collaborators and expand the reach of the Institute wherever possible.

been established, however delays and uncertainty will have an impact. Active grants during 2022-23 from the EU come to £6.7M in total funding over the life of the grants. The Institute is following carefully opportunities for international collaboration from UKRI and beyond.

Ensuring the Institute continues to attract the most gifted staff remains a strategic priority, recruiting talented but less experienced individuals who we train and develop into key roles. This supports the continued programme of succession planning which remains an important issue. This will continue to be achieved through new recruitment to priority areas as well as through advancing the progression of early career scientists and other staff and ensuring that they are fully equipped to take leading roles in the future development of the organisation.

GROUP FUTURE DEVELOPMENTS

During this reporting period, and in support of the agreed strategy for the campus BRCL have progressed the opportunity to further develop the campus. BRCL announced in September 2022 an agreement to form a partnership with Biomed Realty Inc (BMR), a US corporation, already with a presence on the campus, to jointly construct a new c. 40,000 ft[2] laboratory and office building. This building is designed to accommodate companies already on the campus, wishing to grow on site. BMR was selected as a development partner following a tender process where a number of potential partners were invited to submit a proposal against an invite to tender package we had developed. Anticipated completion in Q1 2024, the building is expected to have occupants on completion such is the local demand, and at a rental value higher than originally envisaged primarily as result of the limited demand for the high-quality, well located laboratory space that we provide on campus.

Whilst the infrastructure development of the campus is a key component of BRCL of the strategic plan that involves the support of activities to encourage entrepreneurship, science translation and high quality scientific training. To that end, BRCL continues to run the accelerate@babraham programme, provides easy-access laboratory and science capabilities on a short-term basis in a communal laboratory centre, supports the Babraham Institute in their PhD programmes, and works collaboratively with other entrepreneurial initiatives and centres in the region such as Start Codon, and the Cambridge Biomedical Campus.

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REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

RISK MANAGEMENT

The Institute Board of Trustees is responsible for ensuring there are effective and adequate risk management and internal control systems in place to manage the major risks to which the charity is exposed. The Audit Committee agrees an annual risk-based internal audit plan which covers major risks identified by management and the Board of Trustees. It receives reports from internal auditors on the effectiveness of internal controls, progress against the internal audit plan and progress on recommendations made in reports. The Board of Trustees reviews a full risk report annually tracking major risks. The Science and Impact Advisory Committee (SIAC) also assess the science quality and vision covered in various sections of the risk register. The table below summarises how the Institute manages its key risks.

During 2022-23 the Governance and Projects Office undertook an extensive review of the Corporate Risk Register, moving this to the new RSM 4Risk software to ensure easier interactivity, monitoring and reporting of risks. Following consultation with other organisations and industry bodies, the Corporate Risk Register was condensed from 32 to 12 overarching risks to bring us in line with best practice. Looking ahead it is planned that departmental risk registers will move to RSM 4Risk.

In addition to risk registers utilising RSM 4Risk software, in December 2022, as part of an ongoing major review of all institute policies and policy awareness, policies were moved to RSM 4Policies software to enable transparency, easier engagement and monitoring.

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Risk Area Description of Risk Risk Management
Business The Institute having to manage Annual budget setting and monitoring to ensure effective use of
Sustainability the loss or reduction of UKRI- resources. Defined policy and procedure to spend Institute
BBSRC funding. The inability for reserves and effective investment of reserves under the
the institute to remain Treasury Management Policy.
financially viable, Participating in a UKRI-BBSRC-wide Institute Financial
managing energy price sustainability agenda and Peer review process.
increases, insufficient capital Review to ensure progress against ISPG, CCG and KEC objectives.
budget and failures to secure Capital Equipment Policy and Procedures in place to prioritise
enough competitive grant business cases for each UKRI-BBSRC capital equipment funding
income. A lack of technological call. Increase awareness of adequate funding opportunities;
investment at the institute to support and train staff applying for funding (Grants Office)
enable research. Review and approve quality and science alignment of grants,
and advising the grant applicant on how to strengthen proposal
to be submitted (SPOC)
Reputational The Institute having to manage Effective Public Engagement strategy in place to raise Institute's
Maintenance reputational damage caused by profile. Events / conferences for the scientific community to
poor contribution to bioscience, raise the Institute's profile.
scientific misconduct or an Scientific collaborations to raise the Institute's profile.
honest failure to replicate Showcasing the Institute through external communication
results, staff breaching the code mechanisms, including the website, social media, the science
of conduct and the threats annual report and press engagement.
posed by animal rights activism. Biennial Research Integrity Assurance Review (including Lab
A lack of technological notebook OneNote procedures).
investment at the institute Promotion of a good Research Integrity Culture through policies.
which degrades reputation.
Strategic Security Consultant ensures the Institute's interests
are protected and that BRCL delivers security to the correct
specification, reducing the risk of breach/failure.
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RISK MANAGEMENT (CONTINUED)

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Risk Area Description of Risk Risk Management
IT System The Institute being subject to a Continual review of IT procedures and assessment of new risks
Failure cyber-attack, threats due to as they develop to ensure systems are fit for purpose.
unresolved system Maintain Network Security. Urgent recommendations (e.g.,
vulnerabilities, the lack of critical vulnerabilities) are implemented in response to
training of knowledge of staff or notifications from Janet CSIRT service and other notification
negligence. The risk of a major services. Cyber Essentials Certification in place.
incident on site such as a power Immutable (Read-only) backup service for IT servers to ensure
outage, fire, flood etc effecting service recovery is possible in the event of a ransomware attack.
on site data centres. IT staff are trained in IT security and have regular CPD in this
area to ensure knowledge is up to date
Multifactor Authentication (MFA) enabled for all remote access.
Regular communication to staff on new and existing threats to
build knowledge and awareness.
Business The Institute is unable to Equipment and logistical steps in place along with ensuring
Continuity continue day to day operation policies and SOPs are fit for purpose and reflect current best
due to severe business practice. Supply chain resilience is built in as far as possible.
disruption to science and A reciprocal agreement is in place to use facilities at the CRUK
research Cambridge Institute as an emergency centre.
Business Continuity Plan and Crisis Management Team is in
place to provide a framework and table top exercises annually.
Managing external profile of the Institute during the event of an
incident.
Commercial insurance in place to cover financial loss through
business disruption.
HR The Institute is unable to recruit Attractiveness of the Babraham Research Campus and good
Management and retain staff due to staff infrastructure such as provision, housing, parking, etc.
burnout, inadequate team Competitive pay scheme and benefits including research
resources and poor planning. support package. Benchmarking of pay and benefits with other
organisations to ensure parity.
Provision and maintenance of excellent science facilities and
equipment and support for immigration licenses and visas and
an employee assistance programme to support staff wellbeing.
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Within BRCL, the Directors carry out regular reviews of the risks to which the company may be exposed both at regular internal auditors RSM to act as an independent internal audit service. The principal strategic risks considered by the BRCL board include:

War in Ukraine, and the effects on supply chain issues and increases in energy costs
Inflation and the global economic slowdown.
Reduction in investment in the life-science sector

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REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

FINANCIAL REVIEW

During the year, the total group reserves increased from £152m to £156m, with details of the movement in group funds shown in the Statement of Financial Activities on page 28.

The individual results within the group are detailed below.

BABRAHAM INSTITUTE

Overall results for the Babraham Institute show an increase in total funds from £141m to £143m. Restricted revenue funds decreased by £533k, Restricted Capital funds increased by £4,776k and Unrestricted Revenue funds decreased by £1,891k. totalling an increase of £2,352k across all funds.

the year of £1,891k compared to a deficit of £3,573k last year. The deficit before investment gains/losses, depreciation and transfers is £3,927k and £4,061k respectively for 2023 and 2022.

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2023 2022
Deficit before Investment gains/losses, depreciation and transfers unrestricted funds (3,927) (4,061)
Depreciation (6,255) (4,762)
Transfers from capital and revaluation reserves 8,776 3,380
Fair Value adjustment to investment properties (400) (300)
Impairment on investment in subsidiary - 468
Investment Income (dividends and interest) 255 313
Investment gains/(losses) - realised and unrealised (340) 1,389
Deficit for year unrestricted funds (1,891) (3,573)
----- End of picture text -----

Revenue income increased by around £1m during the year (grant income £441k and goods, services and rental income £650k). Similarly, increases in salary costs (£605k), travel costs (£204k) and energy costs (£278k) were incurred in the year. Actual energy costs increased by £1,055k on 2021-22 values, however this was offset by additional UKRI-BBSRC funding of £777k received in the year.

Annual revaluations within the Institute (£10.3m) to land and buildings have further increased capital reserves in the year (note 9). Capital funds within the Institute continue to be released from capital reserves against depreciation charges in the year. During the year £3,233k of capital funding was received (2022 : £4,002k).

The Institute continues to maximise its returns on funds by holding investments managed by Royal Bank of Canada. This allowed the Institute to benefit from investment income of £255k in the year (2022 : £313k).

The Institute has continued to actively monitor its cost base and strive for efficiency savings where possible to ensure the Institute continues to maximise its operations based on the funding received. Looking to the future the Institute continues to remain on a tight financial budget and a longer-term focus will need to be placed upon continuing to seek and secure fresh income streams.

BABRAHAM RESEARCH CAMPUS LIMITED (BRCL)

The profit for the year, after taxation, amounted to £1,958k (2022 - profit £2,590k). The main movement in profit this year is as a result of increased salaries, utilities costs and professional fees associated with the new joint venture. Rental revenues have seen a 7% increase and meeting and conferencing revenues have seen a 150% increase compared to last year, this brings the trading activities for this area of the business back to pre-COVID levels.

Gift aid of £220k (2022: £300k) was paid to The Babraham Institute relating to the year 2022-23.

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REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

FINANCIAL REVIEW (CONTINUED)

BABRAHAM INSTITUTE ENTERPRISE LIMITED (BIE)

Babraham Institute Enterprise Limited made a profit before tax and gift aid of £277k (2022: profit £647k). Excluding investment impairments/impairment reversals, operating results are £322k profit for 2022-23 and £56k profit for 2021-22. Turnover including licencing income for 2022-23 of £2,320k compared to £1,664k for 2021-22, an increase of £656k. This increase in activity also led to higher costs of £390k in the year, and these movements account for the increase in operating results.

Gift aid of £333k (2022: £nil) was paid after the year end (in July 2023) to the Babraham Institute, resulting in a deferred tax charge of £86k for the year ended 2022-23.

RESERVES POLICY

reserves required by the Group is therefore determined by reference to:

Future operational and capital expenditure requirements;
Potential financial risks identified in the Risk Register;
Funding required for strategic investments not included in the operating budget;
Working capital / liquidity requirements;

The Trustees have reviewed the reserves of the Group. The review encompasses the nature of the income and expenditure streams, the need to match variable income with fixed commitments, and the nature of the reserves. The Trustees concluded that to facilitate long term planning they aim to achieve unrestricted reserves of at least £16m, covering 3 months working capital and any other financial obligations should the business cease to operate. Currently free reserves are around £21m and the Trustees are satisfied that these reserves are sufficient to finance both the general reserve and provide the necessary funds to mitigate financial risks associated with operational and capital expenditure identified in the Risk Register.

PRINCIPAL FUNDING SOURCES AND REVIEW OF EXPENDITURE

The Babraham Institute is one of eight Institutes receiving strategic funding from the UKRI-BBSRC. Funding is derived from our principal sponsor, the UKRI-BBSRC, together with external grants or fellowships competitively gained from other research councils, charities and industry.

Expenditure incurred as analysed in the Statement of Financial Activities relates to Charitable Activities, including support costs. Commercial trading activities are shown separately.

Staff costs form the largest single component of group expenditure £18.1m (2022: £16.9m), followed by consumables (laboratory and general) £4.7m (2022: £4.4m), repairs and maintenance costs £3.6m (2022: £3.7m) and rent, rates and insurance £2.3m (2022: £2.3m).

Total expenditure for the year of £46.4m compares to £41.8m in 2021-22 an increase of £4.5m. Increases in salary costs (£1.1m), energy costs (£1.7m) and depreciation charges (£1.5m) account for the majority of the increase in expenditure in this reporting year.

GOING CONCERN

The Babraham Institute is dependent on various funding sources including UKRI-BBSRC to meet its liabilities as they fall due within future years. As part of the Comprehensive Spending Review (CSR) in 2021, Research Councils (of which the UKRIBBSRC is one) received financial allocations for revenue and capital funding. The CSR set resource and capital budgets from 2022-23 to 2024-25.

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GOING CONCERN (CONTIUNED)

-24 was confirmed in March 2023 along with provisional funding allocations for the

4 years to 2027-28.

Given that;

the Institute has now received indicative funding for the next five years from UKRI-BBSRC to 2027-28
the Institute does not envisage any issues with funding in this five-year period;
the Institute continues to be commended on its financial management from UKRI-BBSRC assurance reviews; the latest Annual Financial Assurance audit (received February 2023) from UKRI-BBSRC focussing on the UKRI-BBSRC funded expenditure (to ensure the Institute aligns its funding with research outcomes) continues to be favourable.
the annual research returns submitted by the Institute have all been favourable this is used by UKRI-BBSRC to evidence why they provide on-going grant funding to institutes such as Babraham Institute;

the Trustees have no reason to believe that future funding from the UKRI-BBSRC will not be forthcoming at a level which, together with the sufficient reserves held by the Institute and its subsidiaries, is sufficient for the group to continue in operational existence for the foreseeable future.

As part of financial forecasting, various scenarios have been explored for 2023-24 and 2024-25 on future income streams and costs. Forecasts will include elements of estimations, however the level of uncertainty in our plans is not considered material. Accordingly, after making appropriate enquiries, the Trustees consider the Group and Parent Charity have adequate resources to continue in operational existence for the foreseeable future being a minimum of twelve months from when these financial statements are approved. For this reason, the financial statements have been prepared on a going concern basis.

Mr G Braham

Chairman of the Audit Committee, Trustee and Member

Date:

THE BABRAHAM INSTITUTE

OPINION

We have audited Group Statement of Financial Activities, the Group and Parent Charitable Company Balance Sheets, the Group 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 an then ended;
income and expenditure for the year
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 have been appointed as auditor under the Companies Act 2006 and report in accordance with regulations made under that Act. We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. s responsibilities for the audit of the financial ethical requirements that are relevant to our audit of the financial statements in the 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

based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial evidence obtained up to the date of our report. However, future events or conditions may cause the group or parent charitable company to cease to continue as a going concern.

including effects arising from macro-economic uncertainties such as the crisis in Ukraine, Brexit and Covid-19, we assessed and challenged the reasonableness of estimates made by the trustees and the related disclosures and analysed how those ue operations over the going concern period.

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 oing 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 trustees with respect to going concern are described in the relevant sections of this report.

THE BABRAHAM INSTITUTE

(CONTINUED)

OTHER INFORMATION

The other information comprises the information included in the Annual Report, other than the financial statements and 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is 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.

OPINION ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006

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

included in the Annual Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
Annual Report have been prepared in accordance with
applicable legal requirements.

MATTER ON WHICH WE ARE REQUIRED TO REPORT UNDER THE COMPANIES ACT 2006

In the light of the knowledge and understanding of the group and parent charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Rep included in the Annual Report.

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 requires us to report to you if, in our opinion:

adequate accounting records have not been kept by the parent charitable company, or
returns adequate for our audit have not been received from branches not visited by us; or
the accounting records and returns; or
certain disclosures of trustees' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.

RESPONSIBILITIES OF TRUSTEES

As explained more fully in the Trustees' Responsibilities Statement set out on page 5, the trustees (who are also the directors of the charitable company for the purposes of company law) 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 trustees 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 trustees are responsible for assessing the group and the parent charitable going concern basis of accounting unless the trustees either intend to liquidate the group or parent charitable company or to cease operations, or have no realistic alternative but to do so.

THE BABRAHAM INSTITUTE

(CONTINUED)

LITIES 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 o

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. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:

We obtained an understanding of the legal and regulatory frameworks that are most applicable to the Group and the parent charitable company. We identified the following laws and regulations as the most likely to have a material effect on the amounts or disclosures in the financial statements if non-compliance were to occur; Charities SORP (FRS 102), Companies Act 2006, Data Protection Act 2018, Health and Safety regulations, Tax legislation, Anti-Bribery legislation and Employment law;
We understood how the Group and parent charitable company is complying with those legal and regulatory frameworks by making enquiries of management, those responsible for legal and compliance procedures and the Audit Committee. We corroborated our enquiries through review of board minutes, papers provided to the Audit Committee and any correspondence received from regulatory bodies;
al statements. This
included the evaluation of the risk of management override of controls. We determined that the principal risks were in relation to:
journal entries that increased revenue;
potential management bias in determining accounting estimates; especially in relation to valuation of leasehold land and buildings and investment properties; and

transactions with related parties.

Our audit procedures involved:
evaluation of the design and implementation of controls that management has in place to prevent and detect fraud;
journal entry testing, incorporating data analytics, with a focus on journals meeting our defined risk criteria based on our understanding of the Group;
using a valuation specialist to challenge assumptions and judgements made by management in the significant accounting estimate relating to the valuation of leasehold land and buildings and investment properties; charitable company and its subsidiaries and testing that these transactions had a valid business purpose; and
requirements.
These audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it;

THE BABRAHAM INSTITUTE

(CONTINUED)

LITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

The engagement p
capabilities to identify or recognise non-compliance with laws and regulations included consideration of the engagement
understanding of, and practical experience with, audit engagements of a similar nature and complexity, through appropriate training and participation;

knowledge of the industry in which the Group and parent charitable company operates; and

understanding of the legal and regulatory requirements specific to the Group and parent charitable company.

Relevant laws and regulations were communicated to all engagement team members. We 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

USE OF OUR REPORT

matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by members as a body, for our audit work, for this report, or for the opinions we have formed.

James R Brown

Senior Statutory Auditor for and on behalf of Grant Thornton UK LLP Statutory Auditor, Chartered Accountants Cambridge Date :

THE BABRAHAM INSTITUTE

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES - INCORPORATING THE CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 MARCH 2023

Note	Restricted revenue funds Restricted capital funds Un- restricted funds 2023 Total funds 2022 Total funds
Income from: Charitable activities Trading activities Investment income Total income 2 Expenditure on: Charitable activities Raising funds Taxation 7 Total expenditure 3 (Losses)/Profit on investments 10,11,12 Net income/(expenditure)	17,807 3,234 4,893 25,934 27,018 - - 14,913 14,913 13,179 - - 317 317 350
	17,807 3,234 20,123 41,164 40,547
	(17,807) - (16,998) (34,805) (32,245) - - (11,084) (11,084) (9,277) - - (526) (526) (328)
	(17,807) - (28,608) (46,415) (41,850)
	- - (785) (785) 1,680
	- 3,234 (9,270) (6,036) 377

Net income/(expenditure) for the year is attributable to: The parent undertaking Minority interest	- 3,234 (9,705) (6,471) 946 - - 435 435 (569)
	- 3,234 (9,270) (6,036) 377
Transfers Release of capital funds/transfers 17 Other recognised gains and losses Gain on revaluations of tangible fixed assets 9	(533) (8,776) 9,309 - - - 10,318 - 10,318 5,567
Other recognised gains for the year is attributable to: The parent undertaking Minority interest	- 10,318 - 10,318 5,567 - - - - -
	- 10,318 - 10,318 5,567
Movement in funds attributable minority interests 11 Net movement in funds Balances brought forward 17 Balances carried forward at 31 March 2023 17	- - (435) (435) (569)
	(533) 4,776 (396) 3,847 5,375
	6,292 116,767 21,274 144,333 138,958
	5,759 121,543 20,878 148,180 144,333

All amounts relate to continuing activities. All recognised gains and losses are included in the consolidated statement of financial activities. The notes on pages 31 to 54 form part of these financial statements.

THE BABRAHAM INSTITUTE

REGISTERED NUMBER: 03011737 BALANCE SHEETS AT 31 MARCH 2023

Note	Group Institute 2023 2022 2023 2022
Fixed assets Intangible assets 8 Tangible assets 9 Investment properties 10 Investments 11,12 Current assets Stocks 13 Debtors 14 Cash at bank and in hand Creditors: amounts falling due within one year 15 Net current assets Total assets less current liabilities Debtors: amounts falling due after more than one year 16 Net assets Funds Restricted capital fund Revaluation Reserve 17 Unrestricted funds 17 Restricted revenue fund 17 Minority Interests 11	254 135 - - 108,987 100,415 108,087 99,827 3,000 3,400 3,000 3,400 24,635 30,134 29,060 35,358
	136,876 134,084 140,147 138,585
	337 282 146 148 9,514 8,140 4,781 5,450 22,673 21,677 6,711 5,165
	32,524 30,099 11,638 10,763 (13,309) (12,444) (8,421) (8,336)
	19,215 17,655 3,217 2,427
	156,091 151,739 143,364 141,012
	183 253 - -
	156,274 151,992 143,364 141,012
	47,600 48,959 47,554 48,913 73,943 67,808 73,943 67,808
	121,543 116,767 121,497 116,721 20,878 21,274 16,108 17,999 5,759 6,292 5,759 6,292
	148,180 144,333 143,364 141,012
	8,094 7,659 - -
	156,274 151,992 143,364 141,012

The Institute includes in its financial statements leasehold land and buildings owned by third parties, these are detailed further in notes 9 and 10.

These financial statements were approved by the Board of Trustees and authorised for issue on

Mr G Braham

Chairman of the Audit Committee, Trustee and Member

The notes on pages 31 to 54 form part of these financial statements.

THE BABRAHAM INSTITUTE

CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 31 MARCH 2023

Note	2023 2022
Cash flows from operating activities Net movement in funds 17 Depreciation charge 9 Amortisation of intangible assets 8 Profit on disposal of fixed assets (Impairment)/Impairment Reversal of investments 11 Revaluations and fair value adjustments 9,10 Capital grants received 2 Tax charge 7 Interest received 2 Increase in stocks 13 Increase in debtors 14 Increase/(Decrease) in creditors 15 Tax paid Net cash provided/(used) by operating activities Cash flows from investing activities Interest Received 2 Payments to acquire intangible fixed assets 8 Payments to acquire tangible fixed assets 9 Payments to acquire investments(net of fees) 11,12 Receipts from sale of tangible fixed assets Receipts from sale of investments Capital grants received 2 Net cash provided/(used) by investing activities Cash flows from financing activities Cash funds withdrawn from investments held 12 Net cash provided/(used) by financing activities Change in cash and cash equivalents in the reporting period Cash and cash equivalents at the beginning of the reporting period Cash and cash equivalents at the end of the reporting period	4,282 5,944 6,542 5,083 16 13 (76) (6) 45 (591) (9,918) (5,267) (3,234) (4,002) (526) (328) (317) (350) (55) (49) (1,564) (909) 858 (1,380) 793 194
	(3,154) (1,648) 317 350 (162) (58) (4,802) (6,432) (29,436) (7,782) 109 33 28,813 6,190 3,234 4,002
	(1,927) (3,697) 6,077 6,940
	6,077 6,940
	996 1,595 21,677 20,082
	22,673 21,677

The net debt reconciliation is shown in Note 21.

The notes on pages 31 to 54 form part of these financial statements.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

1 ACCOUNTING POLICIES

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

1.1 Basis of preparation

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective January 2019) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK an Republic of Ireland (FRS 102) and the Companies Act 2006. The particular accounting policies adopted in the preparation of the financial statements are set out below and have been applied consistently with the previous year.

1.2 Going Concern

-24 was confirmed in March 2023 along with provisional funding allocations for the

4 years to 2027-28.

Given that ;

the Institute has now received indicative funding for the next five years from UKRI-BBSRC to 2027-28
the Institute does not envisage any issues with funding in this five-year period;
the Institute continues to be commended on its financial management from UKRI-BBSRC assurance reviews; the latest Annual Financial Assurance audit (received February 2023) from UKRI-BBSRC focussing on the UKRI-BBSRC funded expenditure (to ensure the Institute aligns its funding with research outcomes) continues to be favourable.
the annual research returns submitted by the Institute have all been favourable this is used by UKRI-BBSRC to evidence why they provide on-going grant funding to institutes such as Babraham Institute;

Accordingly, after making appropriate enquiries, the Trustees consider the Group and Parent Charity have adequate resources to continue in operational existence for the foreseeable future being a minimum of twelve months from when these financial statements are approved. For this reason, the financial statements have been prepared on a going concern basis.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2022 (CONTINUED)

1 ACCOUNTING POLICIES (CONTINUED)

1.3 Basis of consolidation

The consolidated financial statements incorporate the financial statements of subsidiary companies - Babraham Research Campus Limited and Babraham Institute Enterprise Limited.

The results of the subsidiaries are incorporated on a line by line basis as required under the SORP.

Babraham Institute Enterprise Limited has a 40% holding in Bioscience Partnership Limited. The results of Bioscience Partnership Limited have not been included for consolidation purposes on the grounds that it is immaterial in the context of group operations.

A separate income and expenditure account dealing with the results of the charitable company has not been presented as permitted under section 408 of the Companies Act 2006. The charitable company, The Babraham Institute, is referred to as the Institute throughout the financial statements.

1.4 Incoming resources

Income comprises unencumbered grants received from research councils; grant income from collaborative, commissioned and competitively awarded research projects; income from miscellaneous charitable activities; commercial and residential rents from the letting of Group controlled property; and interest earned on the investment of surplus funds.

Income is recognised when the Institute becomes legally entitled to the income and the amount can be quantified with reasonable accuracy. All core UKRI-BBSRC grants are recognised as revenue in the year they are receivable. Grant income including research grants received in advance of conditions being met is deferred until those conditions are fully satisfied.

Capital grants are recognised in the consolidated statement of financial activities when entitlement passes, and once the criteria of certainty and measurement are met.

Other charitable income represents non-grant revenue from providing scientific research services to other academic institutions and other services. Revenue is recognised in the year in which the obligation is fulfilled.

Trading income, which includes rent and letting income and other income relates to non-charitable services undertaken and is recognised in accordance with the terms of the contracts entered into, reflecting the point at which the obligations have been satisfied.

1.5 Fund accounting

Unrestricted funds

Unrestricted funds represent income which is expendable at the discretion of the Board in the furtherance of the objects of the charity. Such funds may be held in order to finance both working capital and capital investments.

Restricted funds

Income received by way of grants, sponsorship, donation or legacy which is directed by the provider as to be applied for specific purposes is accounted for within restricted income. Awards applied within the terms dictated by the awarding authority on the acquisition or improvement of tangible fixed assets are also accounted for within restricted income funds in full. The balance of the restricted fixed asset fund is reduced by the depreciation or amortisation charges over the expected useful life of the asset. This treatment has been applied to reflect the assets being on land owned by a third party, therefore at the end of the lease they will revert to that third party (see further explanation below regarding the ownership of land and buildings).

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2022 (CONTINUED)

1 ACCOUNTING POLICIES (CONTINUED)

1.6 Resources expended

Expenditure is recognised on an accruals basis as a liability is incurred. Resources expended are classified according to the nature of the cost as follows;

Charitable activities comprises those costs incurred by the charity in the delivery of its activities and services. It includes both costs that can be directly allocated to such activities and those costs of an indirect nature necessary to support the charities activities.

Trading activities - represents the costs associated with trading and raising income including the Institute's rental activities and tenant services and investments. Commercial trading operations relate to income and expenditure incurred by the trading subsidiaries.

Governance costs include those costs associated with meeting the constitutional and statutory requirements of the charity and include audit fees and costs linked to the strategic management of the charity.

Support costs - consistent with the use of the resource, e.g. floor area, staff numbers.

1.7 Tangible fixed assets

The Institute includes in its financial statements leasehold land and buildings owned by third parties, which it occupies and enjoys through peppercorn leases, at their full value. The Trustees consider that in substance, the risks and rewards of ownership of the assets have passed to the Institute, and as such follow a policy of recognising the assets on the balance sheet to reflect the continuing occupancy of these assets for the foreseeable future. The Institute s lease with its landlord (UKRI) was renewed on 31 July 2019 for a further 25 years, again at peppercorn rent.

In 2020-21 BRCL renewed its lease with its Landlord (UKRI) and rent is now payable on leasehold land and buildings owned by third parties. This lease is recognised as an operating lease and hence BRCL no longer recognises any land and buildings on its balance sheet.

Scientific building objectives. These properties are held at fair value. Other buildings represent those buildings used for ancillary purposes. These properties are held at cost less impairment

1.8 Fixed asset revaluation

Leasehold land and buildings are included at open market value where this can be established or depreciated replacement cost in the case of specialised scientific buildings. Professional valuations are reviewed periodically in the interim periods. The resulting valuations are depreciated in accordance with the depreciation policy.

1.9 Depreciation

Depreciation is provided by the group to write off the cost or valuation, less estimated residual values, of all fixed assets other than assets in course of construction, evenly over their expected useful lives. It is calculated at the following rates:

Computer equipment* - 3 years straight line
Non-computer equipment* - 3-5 years straight line
Energy Generating Plant* - 10 years straight line
Leasehold land and buildings - over the shorter of the period of the lease, plus any notified intended extension thereto and the estimated useful remaining life.

*Computer equipment, Non-computer equipment and Energy Generating plant are included in Fixtures and Equipment in Note 9.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

1 ACCOUNTING POLICIES (CONTINUED)

1.10 Impairment of fixed assets

The need for any fixed asset impairment write-down is assessed by comparison of the carrying value of the asset against the higher of net realisable value and value in use.

1.11 Investment property

Investment Properties represent long leasehold properties let to tenants on a commercial basis. These properties are held at open market value with any changes in value held in a revaluation reserve unless the value of the reserve is insufficient to cover a deficit when an impairment loss is put through the SOFA.

The Institute includes in its financial statements leasehold investment properties owned by third parties, that it occupies and enjoys through peppercorn leases at their full market value. The Trustees consider that in substance, the risks and rewards of ownership of the assets have passed to the Institute, and as such follow a policy of recognising the assets on the balance (UKRI) was renewed on 31 July 2019 for a further 25 years, again at peppercorn rent.

Within BRCL, a single new lease was entered into in December 2020, with new terms and provisions, including the requirement to pay rent to UKRI-BBSRC. The lease is structured in a way to represent the role BRCL has in the delivery of the Campus vision on behalf of UKRI-BBSRC and to protect the significant capital investment UKRI-BBSRC has made into the Campus. The nature of the rent provisions and short surrender rights means this lease is accounted for as an operating lease. It includes assets used for leasing out to life science start up and scale up businesses, plus service and self-occupied buildings and does not recognise any valuation on the balance sheet.

1.12 Intellectual property

The cost of acquired intellectual property is capitalised and written off over its useful economic life. Intellectual property assets are reviewed for impairment if events or changes in circumstances indicate that the carrying value may not be recoverable.

1.13 Research and development costs

Research and development costs are written off to the consolidated statement of financial activities account as they are incurred.

1.14 Grants

UKRI-BBSRC capital grants are included within restricted capital funds and released over the estimated useful economic lives of the assets funded by the grant.

1.15 Stocks

Stocks are valued at the lower of cost and net realisable value.

1.16 Foreign currencies

Foreign currency transactions are translated at the rates ruling when they occurred. Foreign currency monetary assets and liabilities are translated at the rates ruling at the balance sheet dates. Any differences are taken to the statement of financial activities.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

1 ACCOUNTING POLICIES (CONTINUED)

1.17 Pension costs

-BBSRC contracts. All Institute staff are now employed under local contracts, however staff previously contributing to the Research

This is an unfunded multi-employer defined benefit scheme. Since any assets and liabilities of the scheme cannot be split between participating emp charged to the income and expenditure account as incurred.

Contributions by all other Institute staff and those by the subsidiary undertakings (BRCL and BIE) are made to a defined contribution pension scheme and charged to the income and expenditure account as incurred.

1.18 Leased assets

, the assets are treated as if they had been purchased outright. The amount capitalised is the present value of the minimum lease payments payable over the term of the lease. The corresponding leasing commitments are shown as amounts payable to the lessor. Depreciation on the relevant assets is charged to the income and expenditure account.

Lease payments are analysed between capital and interest components. The interest element of the payment is charged to the income and expenditure account over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding. The capital part reduces the amounts payable to the lessor.

All other leases are treated as operating leases. Their annual rentals are charged to the statement of financial activities on a straight-line basis over the term of the lease.

1.19 Taxation

The Institute is a registered charity within the meaning of the UK Taxes Acts and is, therefore, eligible to claim exemptions to income tax and capital gains tax.

The trading subsidiary companies are liable for assessment to taxation.

1.20 Fixed Assets Investments (excluding properties)

Investments in subsidiaries and associates are stated at cost. To the extent that the carrying value exceeds the recoverable amount, an impairment loss is recognised.

Other fixed asset investments are either held at fair value or cost less impairment. Net gains and losses arising on revaluations and disposals during the year are included in the statement of financial activities.

1.20 Fixed Assets Investments (excluding properties)

interests consist of the amount of those in

share of net movement in funds are allocated against the interests of the Group except to the extent that the minority has a binding obligation and is able to make an additional investment to cover the losses.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

1 ACCOUNTING POLICIES (CONTINUED)

1.21 Investments

Investments are shown at fair value with historical cost separately disclosed. Net gains and losses arising on revaluations and disposals during the year are included in the statement of financial activities.

1.22 Financial Instruments

The Group only has financial assets and financial liabilities which qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

1.23 Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition or the balance sheet date and that are readily convertible to known amounts of cash with insignificant risk of change of value.

1.24 Creditors

Creditors are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors are normally recognised at their settlement amount after allowing for any trade discounts due.

1.25 Judgements in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgements and estimates.

The items in the financial statements where these estimates have been made include:

Depreciation, which has been charged in line with the accounting policy above. The amount of depreciation charged and net book value of the assets is included in Note 9.

The items in the financial statements where these judgements have been made include:

Land and buildings and Investment Property are held at fair value in line with the accounting policy 1.7 and 1.11 above. The carrying value, and valuation movements, are included in Notes 9 and 10.
Fixed asset investments are held at fair value in line with the accounting policy 1.20 above. The carrying value, and valuation movements, are included in Note 11.
Investments are held at fair value in line with the accounting policy 1.21 above. The carrying value, and valuation movements, are included in Note 12.
The recognition of land and buildings on the balance sheet is included in line with the accounting policy 1.7 and 1.11 above. The carrying value, and valuation movements, are included in Note 9 and 10.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

2 ANALYSIS OF INCOMING RESOURCES

	Restricted revenue funds Restricted capital funds Unrestricted funds 2023 Total 2022 Total
Trading activities: Grant Income Goods and services Rent Investment income: Bank interest and dividends receivable Royalty/licence income Charitable activities: Grants and Donations UKRI-BBSRC - Competitive strategic grant - Minor works - Other grants Competitive project grants Medical Research Council University Links European Union Industry, levy boards Trusts, foundations, charities Goods and services Rent Total income Total Income 2022	- - 458 458 280 - - 5,058 5,058 3,972 - - 9,397 9,397 8,927
	14,913 14,913 13,179
	- - 302 302 325 - - 15 15 25
	- - 317 317 350
	9,633 - - 9,633 9,633 695 - - 695 1,226 1,723 3,234 - 4,957 5,854 1,088 - - 1,088 1,017 1,042 - - 1,042 1,616 172 - - 172 253 914 - - 914 714 33 - - 33 239 2,507 - - 2,507 1,832 - - 3,062 3,062 2,956 - - 1,831 1,831 1,678
	17,807 3,234 4,893 25,934 27,018
	17,807 3,234 20,123 41,164 40,547
	18,382 4,002 18,163 40,547

Charitable activities relate on the whole to scientific research. Goods and services income and rental income relate to the sale of services, both scientific and non-scientific services to external companies and individuals.

Incoming resources can be geographically analysed as:

	2023 2022
UK Europe Rest of World	39,843 39,801 1,003 738 318 8
	41,164 40,547

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

3 ANALYSIS OF CHARITABLE RESOURCES EXPENDED

Allocation basis	Scientific Research Governance	Total 2023 Total 2022
Staff costs Direct Laboratory supplies Direct Travel and subsistence Direct Equipment and hire charges Direct Repairs and minor works Direct Computing costs Direct Library Direct Legal & professional charges Direct Recruitment Direct Training Direct Other costs Direct Scientific services support costs Use of resource Total Charitable costs Total Charitable costs 2022 Commercial trading operation costs Taxation (note 7) Total Group costs	6,827 135 2,327 - 173 10 100 - 3 - 3 - 102 - 36 173 23 - - - 308 - 24,585 -	6,962 6,578 2,327 2,066 183 83 100 85 3 - 3 4 102 77 209 262 23 6 - 3 308 449 24,585 22,632
	34,487 318	34,805 32,245 11,084 9,277 526 328
	31,964 281

		46,415 41,850

Restricted expenditure included in the above is £17,807k (2022: £17,609k). All other expenditure is unrestricted.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

3 ANALYSIS OF CHARITABLE RESOURCES EXPENDED (CONTINUED)

Analysis of scientific services support costs for charitable purposes

	Administration Estates Technical Services Total 2023 Total 2022 £'000 £'000 £'000 £'000 £'000
Staff costs Travel and subsistence Repairs and minor works Rent and rates Fuel and water charges Equipment and hire charges Depreciation Minor works Waste disposal Computing costs Legal and professional charges Recruitment Training Library Food purchases Bad debts Loss on disposal of fixed assets Other costs Total Support Costs 2022	3,077 1,178 4,082 8,337 8,191 98 1 78 177 77 - 565 1,105 1,670 1,798 686 - - 686 684 59 2,180 - 2,239 1,184 40 13 243 296 336 6,255 - - 6,255 4,761 - 667 - 667 1,426 - 7 - 7 13 - 5 474 479 577 115 123 50 288 358 78 - 3 81 61 93 1 9 103 112 33 - 288 321 207 54 - - 54 46 - - - - 1 (38) - - (38) 14 1,043 581 1,339 2,963 2,786
	11,593 5,321 7,671 24,585 22,632
	10,149 4,894 7,589 22,632

Governance Expenditure

Governance costs during the year can be analysed as

	2023 2022 £'000 £'000
Staff costs Travel and subsistence Legal and professional charges	135 142 10 6 173 133
	318 281

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

4 INCOMING RESOURCES AND RESOURCES EXPENDED

	Group		Institute
	2023	2022	2023	2022
Incoming resources and resources
expended are stated after charging:
Amounts payable to auditors in respect of
audit services to the Institute	73	70	73	70
Amounts payable to auditors in respect
of audit services to subsidiary
undertakings	35	33	-	-
Amounts payable to auditors in respect of	14	13	4	11
non-audit services*
Net loss/(gain) on foreign currency
translations	(25)	(60)	(25)	(60)
Depreciation	6,542	5,083	6,255	4,761
Amortisation of intangible fixed assets	16	13	-	-
Loss/(Profit) on disposal - fixed assets	(76)	6	(38)	13
Operating lease payments in respect of:
- land and buildings	1,841	1,437	641	487
- other leases	6	9	6	9

Non-audit services relate to the provision of corporate tax compliance services and VAT advisory services.

5 EMPLOYEES

Staff costs for all employees were as follows:

	Group Institute 2023 2022 2023 2022
Wages and salaries Social security costs Other pension costs	14,828 13,839 12,633 12,086 1,429 1,297 1,182 1,138 1,862 1,813 1,591 1,576
	18,119 16,949 15,406 14,800

The average number of employees during the year was as follows:

	2023 2022 No No
Charitable activities Support activities Commercial operations	107 110 207 205 53 54
	367 369

Redundancy costs (included in wages and salary costs) during the year totalled £171k (2022: £74k). Redundancy costs relate to staff on external grants, where the grant finishes and staff are not transferred to other Institute employment. 2022-23 redundancy also includes costs relating to three staff posts who, after a Board led review of Institute financial sustainability were consulted and took redundancy pay. Redundancy payments are based on contractual obligations and agreed schemes.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

5 EMPLOYEES (CONTINUED)

The number of staff earning greater than £60,000 was:

Group Institute 2023 2022 2023 2022 No No No No £ 60,000 - £ 69,999 12 16 10 12 £ 70,000 - £ 79,999 13 5 12 5 £ 80,000 - £ 89,999 - 1 - - £ 90,000 - £ 99,999 1 1 1 1 £100,000 - £109,999 - 3 - 3 £110-000 - £119,999 4 2 3 2 £120-000 - £129,999 2 1 2 1 £130,000 - £139,999 - - - - £140,000 - £149,999 - - - - £150,000 - £159,999 1 2 1 1 £160,000 - £169,999 - - - - £170,000 - £179,999 - - - - £180,000 - £189,999 - - - - £190,000 - £199,999 1 - - - 34 31 29 25

Within the Institute, the number of staff earning over £60,000 for whom retirement benefits are accruing under defined contribution schemes amount to 18 (2022: 15) and the amounts paid in the year were £150,484 (2022: £121,558).

The number of staff earning over £60,000 for whom retirement benefits are accruing under the RCUK pension scheme amount to 11 (2022: 10) and the amounts paid in the year were £255,782 (2022: £231,895).

6 REMUNERATION AND BENEFITS TRUSTEES AND KEY MANAGEMENT PERSONNEL

None of the members of the Board of Trustees received any remuneration from the Institute during the year. Aggregate expenses incurred by ten (2022: nine) Trustees in respect of travelling costs totalled £10,499 (2022: £5,679).

Key management personnel includes staff within the highest two pay bands within the Institute. This comprises the Institute Director, Chief Operating Officer, heads of each of the science programmes, plus one other senior group leader - who form part of Babraham Executive Committee (BEC).

The aggregate remuneration for key management personnel during the year was £1,129k (2022: £1,251k). There were no other transactions with key management personnel during the year (2022: none).

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

7 TAXATION

	Group Institute 2023 2022 2023 2022
Corporation tax Current tax on profits for the year BRCL Adjustment in relation to the prior year BRCL Tax Relief in respect of gift aid BRCL Current tax on profits for the year - BIE Total Current Tax Deferred tax Origination/reversal of timing differences BRCL Origination/reversal of timing differences BIE Total taxation on profits for the year	387 430 - - 110 (56) - - (42) (57) - - - 11 - -
	455 328 - - (16) 87 - - -
	526 328 - -

The Babraham Institute is a registered charity and is exempt from tax on income and capital gains falling within section 505 of the Income and Corporation Taxes Act 1988 or section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objectives. No tax charges have arisen in the Charitable Company.

The tax assessed for the year is lower (2022: lower) than the standard rate of corporation tax in the UK of 19% (2022: 19%). The tax differences shown below refer to the trading subsidiaries, Babraham Research Campus Limited and Babraham Institute Enterprise Limited :

Institute Enterprise Limited :
	Group 2023 2022
Surplus on ordinary activities before tax as shown in the accounts of the trading subsidiary - BRCL Surplus on ordinary activities before tax as shown in the accounts of the trading subsidiary - BIE Surplus on ordinary activities multiplied by the standard rate of corporation tax at 19% (2022: 19%). Effects of: Expenses not deductible for tax purposes Impairment charges on investments held Adjustments to tax charge in respect of prior periods Deferred Tax not recognised / Remeasurement of deferred tax Other differences leading to an increase/(decrease) in tax charge Tax relief on gift aid payment Total taxation on profits for the year	2,398 277 2,908 687
	509 683 25 60 - (112) 110 (56) 25 - (101) (182) (42) (65)
	526 328

On 3 March 2021, the Chancellor of the Exchequer announced that the main rate of corporation tax in the United Kingdom will rise to 25% with effect from 1 April 2023 for companies earning annual taxable profits in excess of £250,000. Companies earning annual taxable profits of £50,000 or less will continue to pay corporation tax at 19% with a marginal rate adjustment for companies earning annual taxable profits between the two levels. Deferred tax has been calculated at 19% due to the nature of the adjustments made in the tax computations.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

8 INTANGIBLE ASSETS

Group

Group
	Intellectual Property
Cost At 1 April 2022 Additions Disposals At 31 March 2023 Amortisation At 1 April 2022 Provided for the year Disposals At 31 March 2023 Net book value 31 March 2023 31 March 2022	184 162 (27)
	319
	49 16 -
	65
	254
	135

Intangible assets relate to intellectual property purchased by the subsidiary company Babraham Institute Enterprise Limited.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

9 TANGIBLE ASSETS

Group	Short leasehold land and buildings Fixtures and Equipment Total
Cost or valuation At 1 April 2022 Additions Revaluation Disposals At 31 March 2023 Depreciation At 1 April 2022 Provided for the year Disposals Revaluations At 31 March 2023 Net book value At 31 March 2023 At 31 March 2022	88,852 34,573 123,425 - 4,802 4,802 7,276 - 7,276 - (2,212) (2,212)
	96,128 37,163 133,291
	- 23,010 23,010 3,042 3,500 6,542 - (2,206) (2,206) (3,042) - (3,042)
	- 24,304 24,304
	96,128 12,859 108,987
	88,852 11,563 100,415

The Group includes in its financial statements leasehold land and buildings owned by third parties, which it occupies and enjoys through peppercorn leases, at their full value of £96m. The trustees consider that in substance, the risks and rewards of ownership of the assets have passed to the Group, and as such follow a policy of recognising the assets on the balance sheet to reflect the continuing occupancy of these assets for the foreseeable future. The only circumstance under which the at peppercorn rent.

Short leasehold land and buildings include scientific buildings which are leased and used by the Institute for the purpose of of £96.1m.

Babraham Institute land and buildings were valued as at 31 March 2023 by Powis Hughes Limited, acting as external valuer on the basis of Existing Use Value on the special assumption that the lease from the UKRI-BBSRC is ignored and the Properties are assumed to be held freehold by the Institute.

The valuation has been carried out in accordance with the RICS Valuation Global Standards 2017 (which incorporates the International Valuation Standards 2017) and FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland on the basis of Existing Use Value - using a Depreciated Replacement Cost Approach for the specialised buildings and either a Market or Income Approach for all other buildings and land. This valuation resulted in an increase in valuation of £10,318k at the year end.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

9 TANGIBLE ASSETS (CONTINUED)

Properties held for the purpose of rental income are included in Investment property (Note 10).

Institute	Short leasehold land and buildings Fixtures and equipment Total
Cost or valuation At 1 April 2022 Additions Revaluations Disposals At 31 March 2023 Depreciation At 1 April 2022 Provided for the year Disposals Revaluations At 31 March 2023 Net book value At 31 March 2023 At 31 March 2022	88,852 30,273 119,125 - 4,197 4,197 7,276 - 7,276 - (1,986) (1,986)
	96,128 32,484 128,612
	- 19,298 19,298 3,042 3,213 6,255 - (1,986) (1,986) (3,042) - (3,042)
	- 20,525 20,525
	96,128 11,959 108,087
	88,852 10,975 99,827

The Institute includes in its financial statements leasehold land and buildings owned by third parties, which it occupies and enjoys through peppercorn leases, at their full value. The trustees consider that in substance, the risks and rewards of ownership of the assets have passed to the Institute, and as such follow a policy of recognising the assets on the balance sheet to reflect the continuing occupancy of these assets for the foreseeable future.

The only circumstance under which the Institute could be asked to vacate the site is due to a failure to deliver the required July 2019 for a further 25 years, again at peppercorn rent.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

9 TANGIBLE ASSETS (CONTINUED)

Short leasehold land and buildings include scientific buildings which are leased and used by the Institute for the purpose of £96.1m.

Properties held for the purpose of rental income are included in Investment property (Note 10).

The historical net book value of land and buildings is as follows:

	Group Institute 2023 2022 2023 2022
Historical net book value at 31 March 2023	21,259 22,639 21,259 22,639

10 INVESTMENT PROPERTY

Group	Long term leasehold investment properties
Valuation At 1 April 2022 Revaluation At 31 March 2023 Historical net book value at 31 March 2023	3,400 (400)
	3,000
	90

The valuation of investment land and buildings leased by the Babraham Institute from the UKRI-BBSRC was carried out as at 31 March 2023 by Powis Hughes Limited, chartered surveyors and is based on the special assumption that the terms of lease to the Institute have been ignored and land and buildings are considered to be held as freehold. This valuation resulted in a decrease in valuation of £400k at the year end to £3.0m.

Institute	Investment property
Valuation At 1 April 2022 Revaluation At 31 March 2023 Historical net book value at 31 March 2023	3,400 (400)
	3,000
	90

The Institute includes in its financial statements Investment Properties owned by third parties, which it occupies and enjoys through peppercorn leases, at their full value. The trustees consider that in substance, the risks and rewards of ownership of the assets have passed to the Group, and as such follow a policy of recognising the assets on the balance sheet to reflect the continuing occupancy of these assets for the foreseeable future. on 31 July 2019 for a further 25 years, again at peppercorn rent.

Investment properties were revalued at 31 March 2023 by Powis Hughes Limited, chartered surveyors.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

11 FIXED ASSET INVESTMENTS

Group and Institute	Trade Investments Group undertakings
*Market Value/Cost* At 31 March 2022 Additions Disposals Impairment At 31 March 2023	1,452 6,676 844 - - - (45) -
	2,251 6,676

Trade investments represent investments held by the trading subsidiary companies. Trade investments held by subsidiary companies are in both the UK and Europe.

Research Campus Limited.

The results and assets of its subsidiaries shown for the period ended 31 March 2023 were:

	Babraham Research Campus Limited Babraham Institute Enterprise Limited Total
Turnover Profit/(loss) for the period after taxation Non current assets Current Assets Current Liabilities Net current assets Non-current assets Net assets	14,241 2,320 16,561
	1,958 191 2,149
	1,977 1,423 3,400
	20,874 1,552 22,426 (5,888) (597) (6,485)
	14,986 955 15,941 269 (86) 183
	17,232 2,292 19,524

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

11 FIXED ASSET INVESTMENTS (CONTINUED)

The Institute owns 75% of Babraham Research Campus Limited (Registered in England and Wales number 03241492 address Babraham Hall, Babraham, Cambridge, Cambridgeshire, CB22 3AT) and the UKRI-BBSRC owns the remaining 25%.

The Institute continues to own 100% of Babraham Institute Enterprise Limited (Registered in England and Wales number 06331858 address Babraham Hall, Babraham, Cambridge, Cambridgeshire, CB22 3AT); both companies are incorporated in England.

Other shareholdings held by Babraham Institute Enterprise Limited are detailed below:

rdinary £1 shares representing 40% of the issued share capital of Bioscience Partnership Limited. The company continues not to trade and therefore there is no movement during the year.

The results of Bioscience Partnership Limited are not consolidated on the grounds that they are immaterial in the context of group operations.

Minority interest	2023 2022
At 1 April 2022 Share of result At 31 March 2023	7,659 7,090 435 569
	8,094 7,659

12 FIXED ASSET INVESTMENTS

----- Start of picture text -----
Listed Securities Group and Institute Medium Term Long Term 2023 Total 2022 Total
Market Value
----- End of picture text -----

Listed Securities Group and Institute *Market Value*	Medium Term Long Term 2023 Total 2022 Total
At 1 April 2022 Additions Disposals Transfers/Withdrawals Investment Income Management Charges Realised and unrealised gains and losses At 31 March 2023 Historic cost of initial investment	7,044 21,638 28,682 34,017 5,366 23,357 28,723 7,939 (5,366) (23,357) (28,723) (7,880) (4,604) (1,473) (6,077) (6,940) 102 148 250 314 (29) (102) (131) (157) (326) (14) (340) 1,389
	2,187 20,197 22,384 28,682
	2,108 17,675 19,783 23,973

Listed Securities represent investments held in medium term equity funds and longer-term fixed income instruments. The focus is on capital preservation and to avoid losses over the investment horizon, generating a return in excess of inflation over the long term whilst generating an income to support the ongoing activities of the Institute.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

12 FIXED ASSET INVESTMENTS (CONTINUED)

The investment portfolio includes investments which individually represent five percent or more of the total investments held. This is detailed below.

	Value	Proportion of
		portfolio
Bluebay Investment	1,784	8.0%
Brown Advisory Funds	1,632	7.3%
Brown Advisory Funds	1,484	6.6%
Titan Saguenay Funds	1,360	6.1%
Aurelian Global Resources	1,353	6.0%
Bluebay Funds Impact	1,354	6.0%
Wellington Management Funds	1,245	5.6%
AAF Boston	1,241	5.5%
Pimco Europe Ltd	1,182	5.3%

13 STOCKS

	Group		Institute
	2023	2022	2023	2022
Raw materials, consumables and other stocks	337	282	146	148

14 DEBTORS

	Group Institute 2023 2022 2023 2022
Trade debtors Amounts owed by group undertakings Corporation Tax Grants receivable Other debtors Prepayments and accrued income Amounts owed by subsidiary undertakings Trade debtors Other debtors	3,259 3,449 826 1,570 - - 1,143 1,033 - 190 - - 1,430 1,770 1,430 1,770 2,870 239 360 233 1,955 2,492 1,022 844
	9,514 8,140 4,781 5,450
	- - 796 656 - - 347 377
	- - 1,143 1,033

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

15 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

	Group Institute 2023 2022 2023 2022
Trade creditors Amounts owed to group undertakings Other creditors Corporation tax Other tax and social security Grants in advance EU co-ordinated programme partners Accruals Amounts owed to group undertakings Babraham Research Campus Limited Babraham Institute Enterprise Limited	3,168 2,887 2,628 2,282 - - 382 500 3,343 2,939 643 609 18 11 - - 902 870 531 541 3,659 2,090 2,432 2,090 747 752 747 752 1,472 2,895 1,058 1,562
	13,309 12,444 8,421 8,336
	- - 348 361 - - 34 139
	- - 382 500

Reconciliation of movement in grants receivable and in advance:

	2023 2022
Grants receivable/in advance at 1 April 2022 Additional grants Released during year Grants receivable/in advance at 31 March 2023	(2,090) (3,100) 17,807 17,609 (19,376) (16,599)
	(3,659) (2,090)

16 DEFERRED TAXATION / DEBTORS DUE MORE THAN ONE YEAR

	Group Institute 2023 2022 2023 2022
At 1 April 2022 Credited/(charged) to the statement of financial activities At 31 March 2023	253 253 - - (70) - - -
	183 253 - -

The provision for deferred tax is made up as follows:

	Group Institute 2023 2022 2023 2022
Short term timing differences - BIE Fixed asset timing differences BRCL & BIE	(83) - - - 266 253 - -
	183 253 - -

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

17 FUNDS

The incoming funds for the Institute include restricted funds comprising the following unexpended balances of donations and grants to be applied for specific purposes.

	Restricted revenue funds Restricted capital funds and Revaluation reserve Unrestricted funds Minority Interests Total
*Group* At 1 April 2022 Incoming resources Expenditure, losses and taxation Losses on investments Transfers of funds Gain on revaluations Funds attributable to minority interests At 31 March 2023 *Institute* At 1 April 2022 Incoming resources Expenditure and losses Transfers of funds Revaluation Movement Investment Losses At 31 March 2023	6,292 116,767 21,274 7,659 151,992 17,807 3,234 20,123 - 41,164 (17,807) - (28,608) - (46,415) - - (785) - (785) (533) (8,776) 9,309 - - - 10,318 - - 10,318 - - (435) 435 -
	5,759 121,543 20,878 8,094 156,274
	6,292 116,721 17,999 - 141,012 18,162 3,234 8,106 - 29,502 (18,162) - (18,566) - (36,728) (533) (8,776) 9,309 - - - 10,318 - - 10,318 - - (740) - (740)
	5,759 121,497 16,108 - 143,364

The restricted revenue funds of £5,759k consist of:

funds specifically held by the Institute for future minor building repairs of £118k
UKRI-BBSRC Strategic grant funding and Knowledge Exchange funding of £406k
UKRI-BBSRC Sustainability funds of £4,598k
UKRI-BBBSRC Institute Development Grant funds of £637k

The restricted capital funds comprise:

the assets gifted/let to the Institute from/by the UKRI-BBSRC and the revaluation of those assets, the revaluation of nd and related infrastructure and capital grants receivable. The expenditure
movement is the depreciation on these assets.
rebuild maintenance grants received from UKRI-BBSRC of total value of £5,068k (2022 £5,870k) are held within restricted capital funds.

As the grant requires these assets to be used for the purpose for which the grant was provided, they remain within restricted capital funds.

Details relating to the minority interest are included in note 11.

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

17 FUNDS (CONTINUED)

The transfers of capital funds relate to the release of previously received capital income (held within Capital Reserves) against depreciated charges. Rebuild grant income in capital reserves within The Babraham Institute is released to BRCL for building maintenance costs in the year on buildings transferred to BRCL as part of the campus restructuring exercise in August 2013.

Analysis of net assets between funds

Fund balances at 31 March 2023 are represented by:

	Restricted revenue funds Restricted capital funds and Revaluation reserve funds Unrestricted funds 2023 Total 2022 Total
*Group* Intangible fixed assets Tangible fixed assets Investment properties Investments Current and long-term assets Total liabilities Total funds Minority Interests Total net assets *Institute* Tangible fixed assets Investment properties Investments Current assets Total liabilities Total net assets	- - 254 254 135 - 108,087 900 108,987 100,415 - 3,000 - 3,000 3,400 6,464 10,456 7,715 24,635 30,134 1,430 - 31,277 32,707 30,352 (2,135) - (11,174) (13,309) (12,444)
	5,759 121,543 28,972 156,274 151,992 - - (8,094) (8,094) (7,659)
	5,759 121,543 20,878 148,180 144,333
	- 108,087 - 108,087 99,827 - 3,000 - 3,000 3,400 6,464 10,410 12,186 29,060 35,358 1,430 - 10,208 11,638 10,763 (2,135) - (6,286) (8,421) (8,336)
	5,759 121,497 16,108 143,364 141,012

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

18 CAPITAL COMMITMENTS

Capital commitments at the end of the financial year for which no provision has been made:

	Group		Institute	Institute
	2023	2022	2023	2022
Contracted	1,132	-	1,132		-

The Institute and BRCL has entered into a number of operating leases for buildings, plant and machinery. The group s future minimum operating lease payments are as follows :

	BRCL Institute 2023 2022 2023 2022
Within one year Within two to five years	1,200 1,200 7 8 4,800 4,800 428 426 6,000 6,000 435 434

19 PENSIONS

-BBSRC contracts. All Institute staff are now employed under local contracts, however staff previously contributing to the Research -employer defined benefit scheme. Since any assets and liabilities of the scheme cannot be split between participating employers, the Institut expenditure account as incurred.

Contributions by all other Institute staff are made to a defined contribution pension scheme and charged to the income and expenditure account as incurred.

A defined contribution pension scheme is operated on behalf of the employees of the subsidiary undertakings. The assets are held separately from those of the Institute in an independently administered fund.

The pension charge represents contributions payable and amounted to:

	2023 2022
Babraham Institute Babraham Institute Enterprise Limited Babraham Research Campus Limited	1,591 1,576 13 11 258 226 1,862 1,813

The amount of pension contributions included within creditors at the year end was £215,254 (2022: £200,372).

THE BABRAHAM INSTITUTE

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023 (CONTINUED)

20 FINANCIAL INSTRUMENTS

	2023	2022
Financial assets measured at amortised cost	30,757	27,857
Financial liabilities measured at amortised cost	(8,885)	(9,602)

Financial assets measured at amortised cost comprise cash, trade debtors, other debtors and accrued income.

Financial liabilities measured at amortised cost comprise trade creditors, other creditors, other tax and social security creditors, bank loans and accruals.

21 ANALYSIS OF CHANGES IN NET DEBT

	1 April		31 March
	2022	Cash flows	2023
Cash and cash equivalents
Cash	21,677	996	22,673

22 RELATED PARTY TRANSACTIONS

The Babraham Institute owns 75% of Babraham Research Campus Limited with UKRI-BBSRC owning the remaining 25% and owns 100% of Babraham Institute Enterprise Limited.

The value of transactions with Babraham Research Campus Limited and Babraham Institute Enterprise Limited for the reporting year and balances outstanding at the year-end are as follows:

	Babraham Research Campus Ltd Babraham Institute Enterprise Ltd 2023 2022 2023 2022
Income Expenditure Debtors at 31 March 2023 Due within one year Creditors at 31 March 2023	1,344 888 1,749 1,484
	(1,654) (1,427) (259) (101)
	636 454 507 579
	(348) (361) (34) (139)

There are no debts at year end which are repayable on demand or incur interest charges.

2023-03-31-accounts

THE BABRAHAM INSTITUTE

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

CONTENTS

PAGE: ANNUAL REPORT

PAGE:

PAGE: FINANCIAL STATEMENTS

THE BABRAHAM INSTITUTE

OFFICERS AND PROFESSIONAL ADVISERS

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

REFERENCE AND ADMINISTRATIVE DETAILS OF THE CHARITY

LEGAL STATUS

PRINCIPAL ACTIVITY

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

STRUCTURE, MANAGEMENT AND GOVERNANCE

BOARD OF TRUSTEES

Denotes members of the Audit Committee as at 31 March 2023.

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BILITIES STATEMENT

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006 (CONTINUED)

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

COMPLIANCE WITH SECTION 172(1) OF THE COMPANIES ACT 2006 (CONTINUED)

OBJECTIVES AND ACTIVITIES

INSTITUTE OBJECTIVES

SCIENTIFIC AIMS

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

INSTITUTE OBJECTIVES (CONTINUED)

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

INSTITUTE OBJECTIVES (CONTINUED)

INSTITUTE MISSION STATEMENT

INSTITUTE REMIT

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BABRAHAM GROUP BUSINESS OBJECTIVES

Excellent fit-for-purpose infrastructure for science

The highest standards of Corporate Social Responsibility

Robust sustainability

Efficient and effective management

A high standard of Corporate Governance

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

BABRAHAM GROUP BUSINESS OBJECTIVES (CONTINUED)

Within BRCL specifically, the key business objectives are:

EMPLOYEES

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

EMPLOYEES (CONTINUED)

SUMMARY PUBLIC BENEFIT STATEMENT

ACHIEVEMENTS AND PERFORMANCE

Number of publications

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE (CONTINUED)

New Grants

Public Engagement

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE PUBLIC ENGAGEMENT (CONTINUED)

Knowledge Exchange and Commercialisation (KEC)

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE KEC (CONTINUED)

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

ACHIEVEMENTS AND PERFORMANCE KEC (CONTINUED)

SUSTAINABILITY

THE BABRAHAM INSTITUTE

REPORT OF THE TRUSTEES (INC THE STRATEGIC REPORT) FOR THE YEAR ENDED 31 MARCH 2023

SUSTAINABILITY (CONTINUED)

Proposed Targets for 2023-24

THE BABRAHAM INSTITUTE