2021-03-30-accounts

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Registered number: 3395389 Charity number: 1064230

NIAB

Trustees' Report and Financial Statements

For the Year Ended 31 March 2021

NIAB

	Page
Reference and Administrative Details of the Charity, its Trustees and Advisers	1 ‐ 2
Trustees' Report	3 ‐ 10
Independent Auditors' Report on the Financial Statements	11 ‐ 13
Consolidated Statement of Financial Activities	14
Consolidated Balance Sheet	15 ‐ 16
Charity Balance Sheet	17 ‐ 18
Consolidated Statement of Cash Flows	19
Notes to the Financial Statements	20 ‐ 60

NIAB

Reference and Administrative Details of the Charity, its Trustees and Advisers For the Year Ended 31 March 2021

Trustees	J E Godfrey, OBE, Chairman
	Professor M J Caccamo, Chief Executive (appointed 1 October 2021)
	Dr T L Barsby, OBE, BSc
	S J Ellwood, BSc
	Dr H Ferrier, BSc, MSc (appointed 8 December 2020)
	K E Fidgeon, FCA
	Dr N Kerby, MBE. BSc
	Dr C A Lang, BA
	R C Lowson
	Professor I J Puddephat, BSc, PhD
	J P Regan (appointed 8 December 2020)
	Professor A G Smith, BSc, MPhil, PhD
	J R Harle (resigned 8 December 2020)
	R A Macdonald, CBE, BSc (resigned 8 December 2020)
Company registered
number	3395389
Charity registered number	1064230
Registered office	93 Lawrence Weaver Road
	Cambridge
	CB3 0LE
Company secretary	Dr J McKee
Chief executive officer	Dr T L Barsby OBE (resigned 30 September 2021)
	Prof M Caccamo (appointed 1 October 2021)
Independent auditors	Crowe U.K. LLP
	Statutory Auditor
	55 Ludgate Hill
	London
	EC4M 7JW
Bankers	Barclays Bank PLC
	1 Churchill Place
	Canary Wharf
	London
	E14 5HP

Page 1

NIAB

Reference and Administrative Details of the Charity, its Trustees and Advisers (continued) For the Year Ended 31 March 2021

Solicitors Birketts LLP 22 Station Road Cambridge CB1 2JD Gowling WLG (UK) LLP 4 More, London Riverside London SE1 2AU

Page 2

NIAB | Annual Report and Accounts | March 2021

TRUSTEES’ REPORT INCORPORATING THE STRATEGIC REPORT

STRATEGIC REPORT

Background

NIAB is at the centre of innovation in agricultural and horticultural crop sciences.

The National Institute of Agricultural Botany was founded by Deed of Trust in 1919. It was regulated by a scheme made by the Secretary of State for Education and Science until 1998, when a new structure was agreed which saw the formation of two charities which would operate in tandem. NIAB was formed to conduct the charitable operations. The National Institute of Agricultural Botany Trust provide land, facilities and financial support to NIAB, which the Trust determine is the preferred vehicle to deliver its charitable activities. NIAB controls two other charities: The Arable Group Limited and NIAB EMR.

Building on a longstanding international reputation for expertise in plant varieties and seeds, NIAB’s scientific capabilities span the crop improvement pipeline; from underpinning research required to develop higher yielding more climate resilient crops, through to the extensive trials data, agronomy expertise and advice needed to ensure these advances are transferred effectively to the wider industry.

The integration of the latest advances in data science alongside expertise in crop pre-breeding, agronomy and farming systems is key to unlocking a step-change improvement in UK crop production and product quality. NIAB’s intention is to be at the forefront of crop innovation and to lead a step change in crop productivity, whether through the increased application of bioinformatics in bringing new genetics to the marketplace, or through the combination of data science and agronomy to target onfarm production directly.

NIAB’s research activities are increasingly part of global partnerships as the science relevant to UK agriculture finds equal application in other countries and is particularly relevant to developing economies.

Public Benefit

The need for innovation in plant breeding and agronomy has never been greater. With climate change and a growing population, food security issues are a global concern. Crop science and technology have a vital role to play in boosting productivity, conserving resources and coping with climate change.

NIAB seeks to:

Mission and Vision

Our mission is to conduct high-quality strategic and applied research in agricultural, horticultural and environmental sciences, and to deliver knowledge, products and services that benefit public and private customers.

Our vision is to connect the science base and industry by providing an integrated research and knowledge transfer hub for the entire crop improvement pipeline, with a clear focus on improving the productivity, quality and resource use efficiency of crop production.

Strategy

A central objective of NIAB’s research activity is to bridge the gap between the basic understanding of plant science and the ability to apply that knowledge in practice.

NIAB has the specialist knowledge, skills and facilities required to support improved crop production, to evaluate variety performance and quality in the field, to conduct agronomy research and to ensure the benefits of new knowledge and genetic potential are transferred on to farm and into the food industry which depends on productive agriculture.

advance science for public benefit, primarily through the support of crop research and development, publishing academic papers and delivering practical solutions, working with a network of scientific partnerships and collaborations with leading academic, research and commercial organisations in the UK, Europe and the rest of the world;
demonstrate how plant resources and crop genetic improvement can help address the major global challenges of sustainable use of resources, climate change, food security and the provision of high quality food to enhance health and nutrition;
promote agriculture, horticulture and arboriculture anywhere in the world.

The Trustees are satisfied they have complied with their duty in section 4 of the Charities Act 2011 to have due regard to public benefit guidance published by the Charities Commission. Based on this guidance, and as described in this Trustees’ report, the Trustees believe the activities of NIAB to be charitable in nature.

NIAB | Annual Report and Accounts | March 2021

Performance

Performance against the 2020/21 objectives is highlighted in the table below:

Objectives	Performance
Covid-19 Towards the end of the 2019/20 year Covid-19 arrived as a global pandemic. The principal objective then became ensuring business continuity. This needs to remain a focus as the effect of the pandemic is still not clear.	NIAB continued to function through the pandemic, carrying out its essential functions underpinning the UK farming industry. Social distancing and hygiene measures were put in place, adapted to local conditions. Those who could work from home did so. NIAB are now managing a return to work in line with government guidance. Income was maintained and, in large part, delivery of projects and services was also maintained.
Review the 5-year plan incorporating the effects of the Covid- 19 epidemic, with a focus on financial stability. Financial stability will be achieved through a mix of increased efforts on income generation alongside cost cutting, including staff costs.	Extra effort put into income generation and cost saving led to an operational profit of £741k. In addition, grant income for capital purchases of £2,785k resulted in a surplus, before adjustment for the defined benefit pension scheme, of £3,641k for the year.
Develop new facilities at East Malling.	With the support of the East Malling Trust who pledged matched financial support, successful bids were submitted to the UK Government’s ‘Strength in Places’ fund and to the South East LEP (SELEP) Local Growth Fund. Construction of a new glasshouse, a reception building, and a wine innovation centre has commenced, bringing new facilities to the East Malling site for the first time in 35 years. These new facilities at East Malling will provide renewed scope for stakeholder engagement and impact from the research at NIAB EMR.
Protect and release two new fruit varieties.	Applications for Plant Variety Rights were filed for Malling Vitality - a June-bearer strawberry, and Malling Ace - an everbearer strawberry.
Merge the subsidiary charity NIAB EMR into NIAB.	The merger of the business, assets and liabilities of NIAB EMR into NIAB was completed on 1 April 2021.
Officially launch the Crop Science Centre, the alliance with the University of Cambridge, recruit science leaders, and secure new sources of funds.	The Crop Science Centre was officially launched on 1 October 2020, with a virtual ceremony attended by national and local dignitaries. Four new Fellowships have been established and recruitment has been successful, with the Fellows starting during Q3 2021. New charitable funding for work at NIAB has been awarded.
In the context of changes to existing arrangements as a result of Brexit, to work with others to retain a UK system for the evaluation of Plant Breeders Rights.	For the time being, it appears that the UK will remain aligned with the European system and retain similar Plant Breeders Rights arrangements.
Work with Defra to establish future needs for NIAB statutory services post-Brexit.	NIAB successfully secured a programme of seed testing, scaling up its activities to take account of requirements postBrexit.
Complete the construction of the Agritech incubator Barn 4, and secure first SME occupants.	Funds were awarded to the NIAB Trust by the Cambridge and Peterborough Combined Authority to build an incubator (labs and offices) to house agritech SMEs. Construction was completed on time and in budget. The first members joined in March 2021.

NIAB | Annual Report and Accounts | March 2021

Objectives for 2021/22

NIAB is addressing the following objectives for the year to 31 March 2022:

Following the arrival of Covid-19 as a global pandemic towards the end of the 2019/20 the principle objective became ensuring business continuity. This needs to remain a focus as the long-term economic effects of the pandemic are still not clear.
Continue to focus on the 5-year plan, incorporating the effects of the Covid-19 epidemic, with a focus on financial stability.
Complete the development of new facilities at East Malling.
Having successfully merged the subsidiary charity NIAB EMR into NIAB, explore further simplification of the NIAB subsidiary structure.
Re-establish a European presence by the creation of a new Spanish Subsidiary, and grow the business in the Iberian peninsula
Restore external communications and events to pre-Covid levels as far as possible.
Successful transition to a new CEO, Professor Caccamo, following Dr Barsby’s retirement.

NIAB | Annual Report and Accounts | March 2021

FINANCIAL REVIEW

Income

The total incoming resources for the group were £31,137k (2020: £26,893k). A total of £10,050k related to Agricultural Services (2020: £10,308k) and £12,559k related to Laboratory and Research (2020: £8,490k), including £2,785k from capital grants and £1,153k to enable a scale up of seed testing capacity post Brexit. The income relating to commercial trading operations totalled £7,829k (2020: £7,124k). The group does not carry out fundraising activities.

Expenditure

The total outgoing expenditure was £27,496k (2020: £23,349k).

Capital Expenditure

The charity funded the capital purchases from both restricted (grants) and unrestricted income. The total group spend was £3,913k (2020 £2,142k).

Business Review and key performance indicators

NIAB continues to review the most appropriate Key Performance Indicators by which the development, performance or position of the various elements of its operations can be effectively measured.

The following Key Performance Indicators (KPIs) have been reviewed for the group: -

eviewed for the group: -
	2021	2020
Charitable and trading	£28,135k	£25,175k
Income (excluding capital
grants £2,440k – 2020:
£816k)
Staff Costs (before past	£15,207k	£15,182k
service cost adjustment)
Average Staff Numbers	361	351
Turnover per head	£77.9k	£71.7k
(excluding capital grants)

The Charitable and trading Income is a measure of the charity’s ability to secure sufficient income to maintain a sustainable research facility. The staff costs and average staff numbers are also an important measure.

Going Concern

The Trustees have acknowledged the guidance on going concern and financial reporting published by the Financial Reporting Council in 2016.

Training and Seed Certification activities are generally contracted on an annual basis and are supported by a diverse customer base. All of that income has been stable over a number of years. More recently the Group has been successful in being awarded large capital grants which are reflected in the increase in income in the current year results.

The Group balance sheet shows a deficit of £12,474k (2020: £10,766k). Taking out the Restricted and Endowment funds leaves an Unrestricted deficit of £13,472k (2020: £11,824k). Stripping out the pension scheme deficit of £19,225k (2020: £13,987k) (discussed in more detail below), the long-term debt to the NIAB TRUST of £1,500k and Fixed Assets (Tangible plus Intangible) plus Trade investments in total within Unrestricted funds of £8,338k (2020: £5,644k) leaves a negative underlying unrestricted reserve of £1,085k (2020: £1,981k) as described in the Reserves policy in this report.

One of the key objectives as noted above for the year was a review of the 5-year plan incorporating the effects of the Covid-19 pandemic, with a focus on financial stability. The result for the year was achieved through a mix of increased efforts on income generation alongside cost cutting.

NIAB has undertaken an exercise of reviewing income and planned expenditure, including financial and cashflow projections, to forecast how various outcomes might affect NIAB’s operations in 2022, considering the risk of decreased income from various sources. The results of the scenario planning have been used as a basis from which to formulate a model for strategic planning.

A key component of the revised 5-year plan is to create surpluses through growth, cost savings and improved margins on services and products. At the time of writing this report, the forecast for 2021/22 is for an operational deficit based on the actual results to September 2021 and new income secured for the remainder of 2021/22. However, once capital grants are included there will be a substantial surplus reported. There is a small operational surplus projected for 2022/23.

A component of the financial risk to NIAB is the pension scheme. The NIAB (1996) Pension Scheme (‘Scheme’) was established in 1996 following NIAB’s separation from Government and establishment as a not-for-profit entity. The Board have taken steps to manage the Scheme deficit, closing the Scheme to new members in 2001 and to future accrual in 2007.

The National Institute of Agricultural Botany Trust (‘TRUST’ Charity No. 1144528) was established at the same time as NIAB and holds the property assets of the previously government owned institution.

NIAB | Annual Report and Accounts | March 2021

The TRUST was established with similar charitable objects to NIAB and fulfils its charitable objects through the provision of support to NIAB.

The TRUST is a participating employer in the Scheme with NIAB. This means that the entire deficit liability of the pension scheme is shared with the TRUST, and the assets of the TRUST support NIAB’s balance sheet in providing the employer covenant, and the recovery payments agreed under the recovery plan. A new recovery plan, based on the triennial valuation at 31 March 2021 is being negotiated with the Pension Scheme trustees.

A key component of the review of going concern, given other uncertainties, is the support from the TRUST.

The TRUST has a balance sheet value of in excess of £57m. It has confirmed that it will continue to support NIAB and provide funding and lending sufficient to ensure NIAB remains a going concern. The funding includes ongoing funding for research and facilities and contributions to the pension scheme recovery payments. The lending is in the form of an ‘overdraft’ facility which can be used by NIAB to manage working capital fluctuations in year of up to £2m.

The trustees have considered the following in arriving at their conclusions on going concern: -

The cash flow forecast and latest management accounts, which give confidence that NIAB can continue to pay its debts as they fall due.
The TRUST’s continued support to NIAB through the provision of facilities and funding and borrowing support.
The Trust being a participating employer alongside NIAB in the Pension Scheme.

After making enquiries and considering the uncertainties described above, the trustees have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, being at least twelve months from the date of approval of these financial statements. For this reason, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

Subsidiaries and related parties

NIAB has three wholly owned subsidiaries, NIAB Trading Ltd, East Malling Services Ltd. and TAG Consulting Limited, which gift aid their profit to NIAB. NIAB EMR and The Arable Group

Limited are charitable companies limited by guarantee. In both cases NIAB, as the sole voting member, has the power to appoint the Trustee Board of NIAB EMR and The Arable Group Limited and they are therefore considered to be subsidiary undertakings during 2020/21 by virtue of control.

NIAB has an important relationship with the National Institute of Agricultural Botany Trust, which has an object to support NIAB in pursuit of its objects. This includes the provision of land and facilities.

Reserves Policy

The Trustees have reviewed the reserves of the group. The review encompassed the nature and reliability of the income and nature and level of commitment of expenditure streams. They have also considered the financial risks, the need to match variable income with fixed commitments, and the nature of the current reserves.

On a risk-based analysis the Trustees have concluded that their aim is to achieve a general reserve equivalent to between two and four and a half month’s worth of unrestricted fund expenditure. At the current annual spend, the reserves target is therefore between £4m and £9m.

At 31 March 2021 group unrestricted reserves excluding fixed assets and pensions liability and the long-term loan from the NIAB Trust, were negative £1,085k (2020: £1,981k), the net improvement reflecting the surplus generated in the year. The Trustees are in the process of reviewing a 5-year plan, a key component of which will be to create surpluses through growth, cost savings and improved margins on services and products, thereby increasing the general reserves position to bring it back to positive and then moving towards the target range. At the time of writing this report, the forecast for 2021/22 was for an operational defecit.

In the meantime, the Trustees continue to monitor closely the financial position of the group, including forecasts and cash flow projections, to ensure they can demonstrate the ongoing ability of the group to be able to pay its debts as they fall due.

Accounting Period

The Trustees present their report and the financial statements for the year ended 31 March 2021. The company’s year-end (Accounting Reference Date) is 28 March, although the financial statements continue to be prepared to 31 March as permitted by section 390(3) of the Companies Act 2006.

NIAB | Annual Report and Accounts | March 2021

RISK ASSESSMENT AND MANAGEMENT

The 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 Board reviews the risk register at each meeting.

Principal Risks and Uncertainties

Risk Area	Risk	Management
Covid-19	Business disruption from staff absence Managing the return of staff to work	The Trustees continue to follow government guidelines and implement local rules regarding hygiene and social distancing . Risk assessments for utilisation of buildings and carrying out of activities and for return to work by employees. Continued support of remote working.
Strategy / Process	Failure to deliver the business plan	The CEO and Executive team remain focused on the actions required to deliver the Business Strategy and Annual Business Plan, whilst ensuring the short-term focus on the Business Continuity plan.
Strategy / Process	Loss of data either electronic or paper	Review of NIABs disaster recovery plan required annually. The Executive have agreed the necessary organisational and investment programme.
Strategy / Process	Loss of Trials Land and farm relocation	NIAB Trust providing interim funding for a New Farm Hub and Trials Land. New site identified and Landlord progressing planning permission.
Financial	Pension Scheme deficit	2021 Triennial valuation carried out. Discussions with the Pension Scheme trustees at Board level. NIAB TRUST as participating employer in the scheme, improving the employers covenant.
Financial	Reduction of the deficit and repayment of loans from the Trust	Delivery of the 5-year business pan, with a focus on annual and sustained surplus generation.

NIAB | Annual Report and Accounts | March 2021

STRUCTURE, GOVERNANCE and MANAGEMENT

Members and Board of Trustees

The Board of Trustees comprises the Chair and up to eleven additional Trustee directors. The Trustees are also the members of the organisation.

Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) (effective 1 January 2015).

Trustee Remuneration

The Board has established the following sub-committees:

Finance (1)
Nominations and Remuneration (2)

The following Trustees have served during the period:

J E Godfrey, OBE	1, 2	Chairman
Dr T L Barsby, OBE, BSc
S J Ellwood, BSc	1, 2
Dr H Ferrier BSc, MSc (appointed 8
December 2020)
K E Fidgeon, FCA	1
J R Harle (retired by rotation on 8
December 2020)
Dr N Kerby, MBE, BSc	1
Dr C A Lang, BA	2
R A Macdonald, CBE, BSc (retired by	2	Deputy Chairman
rotation 8 December 2020)
R C Lowson
Professor I J Puddephat, BSc PhD
J P Regan (appointed 8 December 2020)
Professor A G Smith BSc, MPhil, PhD	2

Professor M J Caccamo was appointed on 1 October 2021.

Recruitment, induction and training of Trustees

NIAB recruits Trustees with the relevant skillset to support the charity’s activities. An induction programme has been put in place for newly appointed Trustees and is kept under review and updated where appropriate. In addition, Trustees are in regular contact with the Chief Executive and executive team and receive updates on key areas of activity.

Organisation and governance

The Trustees have used the UK Charity Governance Code to measure the performance of the board and its structure. The Trustees, through its Nominations Committee, regularly review the skills matrix of the board and make annual recommendations to the full board prior to the AGM in respect of membership and performance of the board. Improving governance is an ongoing work and the Trustees will continue to develop the group’s governance structure.

NIAB is incorporated in England and Wales and is a company limited by guarantee (registered number 03395389) and a registered charity (number 1064230). It is governed by its Memorandum and Articles of Association which were last amended 6 May 2021.

The financial statements have been prepared in accordance with the Charities Act 2011, the Companies Act 2006 and Accounting and Reporting by Charities: Statement of

NIAB provides an honorarium for the Chairman of the Board, the Deputy Chairman and the Chairman of the Finance Committee. In addition to this, a per diem fee is payable to qualifying Trustees.

Decision making and key management

The Board of Directors (Trustees) administer the company and meet quarterly. A Chief Executive Officer is appointed by the Trustees to manage the day-to-day operations of the company. To facilitate effective operations the Chief Executive and Executive Team have delegated authority, within the terms of delegation approved by the board, for all operational matters.

The key management personnel are appointed by NIAB’s Chief Executive; they have authority and responsibility for planning, directing and controlling the activities of the NIAB Group. The nominations and remuneration committee consider the pay for key management personnel in the context of the overall company pay review, and the benchmarking of similar roles within BBSRC institutes and industry.

Employees

The average number of employees for the period was 361 (2020: 351). A policy of equal opportunity is pursued throughout, including the treatment of applications for employment from people who may be disabled, taking account only of the qualifications and abilities of each individual. Should any employee become disabled during the course of employment every effort would be made to retain that person's services and to provide necessary retraining.

NIAB and its Trustees engage with its employees through regular meetings and consultations with the representatives from the Prospect and Unite unions.

Continuing education and training is regarded as vital for the continuance of the charity's work, and assistance to this end is provided to a significant number of employees.

Liability Insurance

The Trustees have effected liability insurance as permitted by the company’s Articles. This insurance does not provide cover in the event that a Trustee is proved to have acted fraudulently or dishonestly.

NIAB l Annual Report and Accounts | March 2021 STATEMENT OF TRUSTEES RESPONSIBILITES IN RESPECTOF THE ANNUAL REPORT AND FINANCIAL STATEMENTS The Trustees Iwho are also directors of NIA8 for the purposes of company lawl are responsible for preparing the Trustees, Report, incorporating the Strategic Report, and the financial statements in accordance with applicable law and regulations. The Trustees are responsible for keeping proper accounting records that disclose with reasonable accur3cy at any time the lin3ncial p051tion of the charitable group 3nd enable them to ensure that the financial statetnents comply with the Companies Act 2006. They are 3150 respoNsible lor safeguarding the 8ssets of the ch2ritable group and hence for taking reasonable steps for the preventlon and detection of fraud and other irregularities. Cornpany law requires the Trustee5 to prepare financial statements for each financial year. Undor that law the Trustees have elected to prepare the financial statements in accordance with United Kingdom Gener31 Accepted Accounting Practise (United Kingdom accounting standards and applicable lawl, including FRS102, the financial reporting standard applic3bl& in the UK and Republic of Ireland. Under company 13W the Trustees must not approve the financial staten)ents unles5 thatthey are satisfied thatthey give 3 true and fair view of the state of affairs of the charitable 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 stèternent5, the Trustees are required to.. The Trustees confirrn that.. 50 far 85 each Trustee is aware, there is no relevant 3udit information of which the audito are unaware., and the Trustee5 have taken all the steps that they ought to h2ve taken as Trustees in order to make thernselves aware ol any relevant audit information and to &stablish that the charitable group's auditor is aware of that information. The Trustees are responsible for the rnaintenance and integrity of the corporate financial information included on the ch8ritable group's website. Legislation in the United Kingdom governing the preparation and di5sernination of financial 5taternents rnay differ from legislation in other select suitable accounting policies and then apply them consistently.. observe the method5 and principle5 in the Charities SORP IFR51021,' make Judgments and accounting estimates that are reasonable and prudent., The trustees approve theTrustees' Report, incorporatingthe Strategic Report, and financial 5taternents which ar& signed on behalf of the Board of Trustees of NIAB. state whether applicable UK Accounting Standards have been followed. subject to any material departures disclosed and explained in the financial statement5,' and J E Godfrey, Chairman Date.. iy ZOLI prepare the financlal statements on the going concern ba515 unless it is inappropriate to presume that the charity will continue in business. io

NIAB

Independent Auditors' Report to the Members of NIAB

Opinion

We have audited the financial statements of NIAB (‘the charitable company’)[and its subsidiaries (‘the group’) for the year ended 31 March 2021 which comprise the Consolidated Statement of Financial Activities, the Consolidated and Charity balance sheets, the Consolidated statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

give a true and fair view of the state of the group’s and the charitable company’s affairs as at 31 March 2021 and of the group’s income and expenditure, for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

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

Conclusions relating to going concern

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

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

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

Other information

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

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

We have nothing to report in this regard.

Page 11

NIAB

Independent Auditors' Report to the Members of NIAB (continued)

Opinions on other matters prescribed by the Companies Act 2006

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

the information given in the trustees’ report, which includes the strategic report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report included within the trustees’ report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report included within the trustees’ report.

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

adequate and proper accounting records have not been kept; or
the financial statements are not in agreement with 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; or

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 10, 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 charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non‐ compliance with laws and regulations are set out below.

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

Page 12

NIAB

Independent Auditors' Report to the Members of NIAB (continued)

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non‐compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charitable company and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, the Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company and the group for fraud. The laws and regulations we considered in this context for the UK operations were General Data Protection Regulation (GDPR), Health and safety legislation, Employment legislation, and Taxation legislation.

Auditing standards limit the required audit procedures to identify non‐compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing of recognition of grant and contract income, and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management, and the Finance Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission, and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non‐compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non‐detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non‐compliance and cannot be expected to detect non‐compliance with all laws and regulations.

Use of our report

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

Naziar Hashemi

Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor

London

Date: 30 November 2021

Page 13

NIAB

Consolidated Statement of Financial Activities (incorporating income and expenditure account) For the Year Ended 31 March 2021

Unrestricted funds 2021 £000 500 14,741 7,829 62	Restricted funds 2021 £000 ‐ 8,005 ‐ ‐	Endowment funds 2021 £000 ‐ ‐ ‐ ‐	Total funds 2021 £000 500 22,746 7,829 62	Total funds 2020 £000 828 18,867 7,124 74
23,132	8,005	‐	31,137	26,893
8,176 13,203 50	‐ 6,067 ‐	‐ ‐ ‐	8,176 19,270 50	7,730 20,422 (4,803)
21,429 1,703 1,998 3,701 (5,349)	6,067 1,938 (1,998) (60) ‐ (60) 308 248	‐ ‐ ‐ ‐ ‐ ‐ 750 750	27,496	23,349 3,544 ‐ 3,544 (355) 3,189
			3,641 ‐
(1,648) (11,824)
			(10,766)	(13,955)
(13,472)			(12,474)	(10,766)

The Consolidated Statement of Financial Activities includes all gains and losses recognised in the year.

The notes on pages 20 to 60 form part of these financial statements.

Page 14

NIAB

Consolidated Balance Sheet As at 31 March 2021

2021 £000 298 8,065 3,655	2021 £000 980 7,465 141	2020 £000 308 7,254 705	2020 £000 819 4,992 141
	8,586 (73)		5,952 (893)
12,018 (12,091)		8,267 (9,160)

	8,513 (1,762)		5,059 (1,838)
	6,751 (19,225)		3,221 (13,987)
	(12,474)		(10,766)

Page 15

NIAB Consolidated Balance Sheet Icontinuedl As at 31 March 2021 2021 £000 2021 £000 2020 202(P £000 Note Charity funds Endowment funds 22 750 75LI Restricted funds 22 248 Unrestricted funds General funds 22 5,753 119,2251 2,163 113,987J Pension reserve 22 Total unrestricted funds 22 113,4721 (11,824) Total funds 112,4741 IlQ,766J The tfU5tee5 acknowledge their respon5ibi1ities for complying with the requirements ol the Act with respect to accounting records and preparation of financial stat&ments. The financial Statements were approved and authorised for issue by the truste&s on 18 November 2021 and signed on their behalf by.. J E Godfrey OBE Professor M J Ca£carno The notes on page5 20 to 60 form part of these financial 5taternents. Page 16

NIAB

Charity Balance Sheet As at 31 March 2021

213 7,137 1,674	2021 £000 4,556 141	208 6,145 606	2020 £000 3,912 141
	4,697 (261)		4,053 (739)
9,024 (9,285)		6,959 (7,698)

	4,436 (236)		3,314 (261)
	4,200 (19,225)		3,053 (13,987)
	(15,025)		(10,934)

Page 17

NIAB Charity Balance Sheet Icontinuedl As at 31 March 2021 2021 £000 2020 EOLKI Note Charity funds Endowment funds 22 750 750 Restricted funds 22 248 308 Unrestricted funds General funds 22 3,202 119,2251 1,995 (13,9871 Pension reserve 22 Total unrestrlcted funds 116,0231 fll,992) Total funds 115,0251 (10,934) The trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements, The financial statements were approved 3nd authorised for issue by the trustees on 18 November 2021 and signed on their behalf by.. J E Godfrey OBE Professor M I Caccamo The notes on pages 20 to 60 form part of these financial statements. Pag& 18

NIAB

Consolidated Statement of Cash Flows For the Year Ended 31 March 2021

Cash flows from operating activities Note Net cash used in operating activities 24 Cash flows from investing activities Proceeds from the sale of tangible fixed assets Purchase of intangible assets Purchase of tangible fixed assets Purchase of investments Net cash used in investing activities Cash flows from financing activities Cash inflows from new borrowing Repayments of borrowing Interest paid Net cash (used in)/provided by financing activities Change in cash and cash equivalents in the year Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year 25	2021 £000 7,425 25 (250) (3,913) ‐ (4,138) 221 (513) (45) (337) 2,950 705 3,655	2020 £000 7 73 ‐ (2,142) (25)
		(2,094)
		429 (174) (70) 185 (1,902) 2,607 705

The notes on pages 20 to 60 form part of these financial statements

Page 19

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

1. General information

NIAB is a company limited by guarantee incorporated in England and Wales and a registered charity. The registered office of the charity is 93 Lawrence Weaver Road, Cambridge, CB3 0LE.

2. Accounting policies

2.1 Basis of preparation of financial statements

The financial statements have been prepared in accordance with the Charities SORP (FRS 102) ‐ 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 2015), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

NIAB meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy.

The Consolidated Statement of Financial Activities (SOFA) and Consolidated Balance sheet consolidate the financial statements of the Charity and its subsidiary undertakings. The results of the subsidiaries are consolidated on a line by line basis.

The Charity has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Financial Activities in these financial statements.

2.2 Fund accounting

General 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 investment.

Designated funds comprise unrestricted funds that have been set aside by the trustees for particular purposes. The aim and use of each designated fund is set out in the notes to the financial statements.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the charity for a particular purpose.

Endowment funds relate to gifts to NIAB, the terms of which stipulate that the capital may not be spent, and the income is to be utilised towards a specific restriction imposed by the donor.

Investment income, gains and losses are allocated to the appropriate fund.

Page 20

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.3 Incoming resources

Income has been analysed in accordance with the service provided.

Income from charitable activities:

Incoming resources from charitable activities are accounted for in the year in which the service is provided.

Trading activities:

Commercial trading operations represent the income from the charitable company’s trading subsidiaries – TAG Consulting Limited, NIAB Trading Ltd and East Malling Services Limited – which is included in incoming resources when the group becomes entitled to receipt.

Investment income:

Interest is included when receivable by the group.

Income Tax recoverable:

Income tax recoverable in relation to investment income is recognised at the time the investment income is receivable.

Capital grant income:

Some grant income is received for the restricted purpose of acquiring fixed assets. Income is accounted for in the year in which the asset is purchased.

2.4 Coronavirus Job Retention Scheme

Government grants are recognised on the performance model, when the charity has complied with any conditions attaching to the grant and the grant will be received. The grant in connection to the Coronavirus Job Retention Scheme has been recognised in the period to which the underlying furloughed staff costs relate. Included in income is an amount of £522k in respect of the Coronavirus Job Retention Scheme.

2.5 Accrued and deferred income

Income from charitable activities includes income received under contract or where entitlement to grant funding is subject to specific performance conditions. This income is recognised as earned when the related services are provided which may mean accruing for invoices not yet raised or deferring payments received in advance of work done.

Page 21

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.6 Expenditure

Liabilities are recognised as resources expended as soon as there is a legal or constructive obligation committing the group to the expenditure. Expenditure is allocated as follows:

Charitable Activities:

Expenditure incurred directly in the fulfilment of the objects of the charity including allocated overheads.

Support costs:

Support costs which include central office functions such as general management, finance, information technology and human resources are allocated across categories of expenditure. The basis of the cost allocation has been explained in note 8 to the accounts.

Governance costs:

Expenditure incurred in running and administering the charity which is not directly attributable to charitable activities.

All expenditure is inclusive of irrecoverable VAT.

2.7 Intangible assets and amortisation

IT platform

IT platforms are recognised at cost, which is then amortised evenly over a three year period once the platform has been released for use.

Purchased goodwill

Goodwill representing the excess of the purchase price compared with the fair value of net assets acquired is capitalised and amortised evenly over a period of between 5 and 10 years as, in the opinion of the trustees, this represents the period over which the goodwill is expected to give rise to economic benefit. Goodwill is reviewed for impairment at the end of the first financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

Plant variety rights

Plant variety rights are recognised at their fair value at acquisition and are amortised evenly in the period over which the rights expire as, in the opinion of the trustees, this represents the period over which the rights are expected to give rise to economic benefit. Plant variety rights are reviewed for impairment if events or changes in circumstances indicate that the carrying value may not be recoverable.

2.8 Tangible fixed assets and depreciation

All tangible fixed assets are stated at historical cost.

Page 22

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.8 Tangible fixed assets and depreciation (continued)

Depreciation is provided on cost over the estimated lives of the assets which are considered to be: .

Leasehold improvements ‐ over the term of the lease Apparatus and equipment ‐ 3 ‐10 years straight line Agricultural and motor vehicles ‐ 3 ‐10 years straight line Apparatus and equipment ** ‐ 33% reducing balance Computer equipment ** ‐ 25% reducing balance Vehicles ** ‐ 10% reducing balance

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Assets in the course of construction are stated at cost and are not depreciated until brought into use.

** assets transferred from The Arable Group

2.9 Financial instruments

The group has financial assets and financial liabilities which qualify as both basic and non‐basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

Non‐basic financial instruments comprise foreign currency contracts measured at fair value. These are not traded in active markets, and have been fair valued using observable forward exchange rates corresponding to the maturity of the contract. Fair value movements are accounted for through the Statement of Financial Activities.

2.10 Stocks

The financial statements include stocks of chemicals, fertilisers and sprays held by the group, together with a valuation of growing crops for resale. These stocks are stated at the lower of cost and net realisable value. Cost is calculated as follows:

‐ Agrochemicals, Fertilisers & Sprays are calculated at value invoiced based on a first in first out basis.

‐ Cultivations & Growing Crops are valued at the cost of the inputs and operations carried out.

‐ Purchased seed is calculated at suppliers invoice value based on a first in first out basis.

‐ Farm saved seed is valued at the cost of inputs and operations carried out.

Net realisable value is based on estimated selling price less further costs expected to be incurred for completion and disposal. Provision is made for slow moving items.

Page 23

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.11 Finance leases and hire purchase

Where assets are financed by leasing agreements that give rights approximating to ownership (“finance leases”), the assets are treated as if they had been purchased outright. The amount capitalised is the present value of the minimum lease payments payable during the lease term.

The corresponding leasing commitments are shown as obligations to the lessor. Lease payments are treated as consisting of capital and interest elements, and the interest is charged to the Statement of Financial Activities in proportion to the remaining balance outstanding.

All other leases are “operating leases” and the annual rentals are charged to Statement of Financial Activities on a straight line basis over the lease term.

2.12 Termination and redundancy payments

Termination and redundancy payments are recognised as a liability and an expense only when the event is demonstrably committed to by either:

a) termination of the employment of an employee or group of employees before the normal retirement date; or
b) provision of termination benefits as a result of an offer made in order to encourage voluntary redundancy.

2.13 Foreign currencies

Assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to the Statement of Financial Activities.

The Charity’s functional and presentational currency is GBP.

2.14 Research and development

All research and development costs are written off as incurred.

2.15 Investments

Investments in subsidiaries are stated at cost. To the extent that the carrying value exceeds the recoverable amount, an impairment loss is recognised. The performance of NIAB Trading Ltd, TAG Consulting Limited and East Malling Services Ltd. are reviewed on a regular basis to monitor the financial performance of the commercial activities.

NIAB holds investments in two commercial companies which it is working with to further its charitable objects.

Page 24

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.16 Debtors

Trade and other debtors are recognised at the settlement amount. Prepayments are valued at the amount prepaid.

2.17 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.

2.18 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.

Page 25

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.19 Pensions

NIAB Defined Benefit Pension Scheme

For the defined benefit retirement plan, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at each balance sheet date.

Actuarial gains and losses arising are recognised immediately in the Statement of Financial Activities.

Past service costs are recognised as an expense on a straight‐line basis over the average period until the benefits become vested. To the extent that the benefits have already vested, the cost is recognised immediately in the Statement of Financial Activities.

The amount recognised in the balance sheet represents the present value of the defined benefit obligation, adjusted for unrecognised past service costs and reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to the lower of the asset and any unrecognised past service cost plus the present value of available refunds or reductions in future contributions to the plan.

The rate used to discount the benefit obligations is based on market yields for high quality corporate bonds with terms and currencies consistent with those of the benefit obligations.

Gains and losses on curtailments/settlements are recognised when the curtailment/settlement occurs.

Universities Superannuation Scheme

The Arable Group Limited participates in the Universities Superannuation Scheme, a defined benefit scheme which is externally funded and contracted out of the State Second Pension (S2P). The liabilities are valued every three years by a professionally qualified independent actuary using the projected unit method, the rates of contribution payable being determined by the trustee on the advice of the actuary. In the intervening years, the actuary reviews the progress of the scheme. Pension costs are assessed in accordance with the advice of the actuary, based on the latest actuarial valuation of the scheme.

The assets of the scheme are held in a separate trustee‐administered fund. The company is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis.

Under FRS102, the company has accounted for the present value of the contributions payable as identified in the most recent funding agreement.

NIAB, NIAB EMR, East Malling Services Limited and The Arable Group Limited also operate group money purchase schemes. For these, the pension costs charged in the financial statements represent the contributions payable by the companies during the year.

Page 26

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.20 Going concern

The trustees have acknowledged the guidance on going concern and financial reporting published by the Financial Reporting Council in 2016.

The Group’s operating activities are diverse. Research and development in Crop Genetics, Computational Biology, Plant Breeding and Plant Characterisation are supported by long‐term contracts and competitively won research grants which, historically, have been largely unaffected by changes in the general economy. Crop Agronomy, Membership, Training and Seed Certification activities are generally contracted on an annual basis, and are supported by a diverse customer base. All of that income has been stable over a number of years. More recently the Group has been successful in being awarded large capital grants which are reflected in the increase in income.

The Group balance sheet shows a deficit of £12,474k (2020: £10,766k). Taking out the Restricted and Endowment funds leaves an Unrestricted deficit of £13,472k (2020: £11,824k). Stripping out the pension scheme deficit of £19,225k (2020: £13,987k) (discussed in more detail below), the long term debt to the NIAB TRUST of £1,500k and Fixed Assets (Tangible plus Intangible) plus Trade investments in total within Unrestricted funds of £8,338k (2020: £5,644k) leaves a negative underlying unrestricted reserve of £1,085k (2020: £1,981k) as described in the Reserves policy in this report

One of the key objectives as noted above for the year is a review of the 5 year plan incorporating the effects of the Covid‐19 pandemic, with a focus on financial stability. This is in process of being achieved through a mix of increased efforts on income generation alongside cost cutting including staff costs in a redundancy exercise carried out in July 2020.

NIAB has undertaken an exercise of reviewing income and planned expenditure including financial and cashflow projections to forecast how various outcomes might affect NIAB’s operations in 2021, taking into account the risk of decreased income from various sources. The results of the scenario planning have been used as a basis from which to formulate a model for strategic planning.

A key component of the revised 5 year plan is to create surpluses through growth, cost savings and improved margins on services and products. . At the time of writing this report, the forecast for 2021/22 is for a small operational deficit based on the actual results to September 2021 and new income secured for the remainder of 2021/22. However, once capital grants are included there will be a substantial surplus reported. There is a small operational surplus projected for 2022/23.

A component of the financial risk to NIAB is the pension scheme. The NIAB (1996) Pension Scheme (‘Scheme’) was established in 1996 following NIAB’s separation from Government and establishment as a not‐for‐profit entity. The Board have taken steps to manage the Scheme deficit, closing the Scheme to new members in 2001 and to future accrual in 2007.

The National Institute of Agricultural Botany Trust (‘TRUST’ Charity No. 1144528) was established at the same time as NIAB, and holds the property assets of the previously government‐owned institution.

The TRUST was established with similar charitable objects to NIAB and fulfils its charitable objects through the provision of support to NIAB.

The Trust is a participating employer in the Scheme with NIAB. This means that the entire deficit liability of the pension scheme is shared with the TRUST, and the assets of the TRUST support NIAB’s balance sheet in providing the employer covenant, and the recovery payments agreed under the recovery plan.

Page 27

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

2. Accounting policies (continued)

2.20 Going concern (continued)

A key component of the review of going concern, given other uncertainties, is the support from the NIAB TRUST.

The trustees have considered the following in arriving at their conclusions on going concern: ‐

The cash flow forecast and latest management accounts, which give confidence that NIAB can continue to pay its debts as they fall due.
The TRUST’s continued support to NIAB through the provision of facilities and funding and borrowing support.
The TRUST being a participating employer alongside NIAB in the Pension Scheme.

After making enquiries and considering the uncertainties described above, the trustees have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future being at least twelve months from the date of approval of these financial statements. For this reason, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

2.21 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 judgements and 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 14
Intangible assets, which were recognised at the fair value of acquisition, and have been amortised. The net book value of the assets is included in Note 13
Income, which has been recognised in accordance with the work completed on grants and contracts
Pension Liabilities: The Trustees have reviewed current rates and expected future returns to set the assumptions used for the valuation of the NIAB (1996) Pension Scheme deficit in consultation with the company actuary. Full details are provided in Note 27.

Page 28

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

3. Income from donations

Unrestricted funds 2021 £000 Donations from National Institute of Agricultural Botany Trust 500 Unrestricted funds 2020 £000 Donations from National Institute of Agricultural Botany Trust 828	Total funds 2021 £000 500 Total funds 2020 £000 828

Page 29

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

4. Income from charitable activities

Agricultural services Laboratory and research Other activities Total 2021 (including Government grants of £7.1m) Agricultural services Laboratory and research Other activities Total 2020 (including Government grants of £5.9m)	Unrestricted funds 2021 £000 7,704 6,900 137 14,741 Unrestricted funds 2020 £000 7,979 4,901 69 12,949	Restricted funds 2021 £000 2,346 5,659 ‐ 8,005 Restricted funds 2020 £000 2,329 3,589 ‐ 5,918	Total funds 2021 £000 10,050 12,559 137 22,746 Total funds 2020 £000 10,308 8,490 69 18,867

Page 30

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

5. Income from subsidiary trading activities

Agricultural services Agronomy consultancy Agricultural services Agronomy consultancy	Unrestricted funds 2021 £000 6,498 1,331 7,829 Unrestricted funds 2020 £000 5,874 1,250 7,124	Total funds 2021 £000 6,498 1,331
		7,829
		Total funds 2020 £000 5,874 1,250
		7,124

6. Investment income

Rental income Rental income	Unrestricted funds 2021 £000 62 Unrestricted funds 2020 £000 74	Total funds 2021 £000 62 Total funds 2020 £000 74

Page 31

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

7. Analysis of expenditure on charitable activities

Summary by fund type

Agricultural services Laboratory and research Agricultural services Laboratory and research Pension ‐ past service cost	Unrestricted funds 2021 £000 7,616 5,637	Restricted funds 2021 £000 5,787 280 6,067 Restricted funds 2020 £000 5,066 95 ‐ 5,161	Total funds 2021 £000 13,403 5,917
	13,253		19,320
	Unrestricted funds 2020 £000 8,370 6,912 (4,824)		Total funds 2020 £000 13,436 7,007 (4,824)
	10,458		15,619

The trustees consider that all expenditure is classified as Research and Development expenditure.

Page 32

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

8. Analysis of expenditure by activities

Agricultural services Laboratory and research Agricultural services Laboratory and research Pension ‐ past service cost	Activities undertaken directly Support costs 2021 2021 £000 £000 8,598 4,805 4,558 1,359 13,156 6,164 Activities undertaken directly 2020 Support costs 2020 £000 £000 10,547 2,889 4,257 2,750 (4,824) ‐ 9,980 5,639	Total funds 2021 £000 13,403 5,917
		19,320
		Total funds 2020 £000 13,436 7,007 (4,824)
		15,619

Analysis of support costs

Management Finance Information Technology Human resources Governance	Agricultural services 2021 Laboratory and research 2021 £000 £000 942 515 2,422 473 969 170 341 86 131 115 4,805 1,359	Total funds 2021 £000 1,457 2,895 1,139 427 246
		6,164

Page 33

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

8. Analysis of expenditure by activities (continued)

Analysis of support costs (continued)

Management Finance Information Technology Human resources Governance	Agricultural services 2020 £000 470 1,129 682 393 215 2,889	Laboratory and research 2020 £000 865 918 493 267 207 2,750	Total funds 2020 £000 1,335 2,047 1,175 660 422
			5,639

Support costs have been allocated to activity cost categories on a basis consistent with the use of resources.

9. Auditors' remuneration

Auditors' remuneration
	2021	2020
	£000	£000
Fees payable to the Charity's auditor for the audit of the Charity's annual
accounts	27	23
Fees payable to the Charity's auditor in respect of:
The auditing of accounts of subsidiaries of the Charity	23	17
Additional fees in respect of audit previous year	38	18
Taxation compliance services	9	8

Page 34

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

10. Staff costs

Wages and salaries Social security costs Contribution to defined contribution pension schemes Operating costs of defined benefit pension schemes	Group 2021 £000 12,914 1,128 912 303 15,257	Group 2020 £000 12,777 1,135 929 (4,462)	Charity 2021 £000 9,284 816 649 295 11,044	Charity 2020 £000 8,996 798 636 (4,477)
		10,379		5,953

During the year a total of £27,500 (2020: £34,908) was paid to 1 employee (2020: 1 employee) as ex gratia payments. In addition £61,582 in total (2020: £13,475) was paid to 7 employees (2020: 2 employees) by way of redundancy payments.

The average number of persons employed by the Group during the year was as follows:

Technical and Scientific Support staff Agricultural staff and casuals	Group 2021 No. 210 59 92 361	Group 2020 No. 205 65 81
		351

Page 35

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

10. Staff costs (continued)

The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was:

	Group	Group
	2021	2020
	No.	No.
In the band £60,001 ‐ £70,000	9	11
In the band £70,001 ‐ £80,000	5	4
In the band £80,001 ‐ £90,000	1	1
In the band £90,001 ‐ £100,000	‐	2
In the band £100,001 ‐ £110,000	2	‐
In the band £110,001 ‐ £120,000	‐	1
In the band £120,001 ‐ £130,000	3	2
In the band £130,001 ‐ £140,000	‐	1
In the band £140,001 ‐ £150,000	1	‐

The key management personnel during the year were:

Dr T L Barsby S M Knight S C Masson (resigned 31 December 2020) Professor M Caccamo M Leaman W Clark N Watson Dr J McKee R Harrison

The total costs relating to key management personnel (including wages and salaries, employees’ national insurance, pension costs and fees) during the year were £898k (2020: £865k).

Page 36

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

11. Trustees' remuneration and expenses

The Chairman and Deputy Chairman of the Board of Trustees and the Chairman of the Board’s Finance Committee received honoraria, totalling £12,300 (2020: £13,200). Meeting fees totalling £8,400 were paid to eight trustees (2020: £5,800 for five trustees). Charity Commission approval has been obtained prior to these payments.

As provided for in the charity’s Articles of Association, the Chief Executive of the charity is also a member of the board (from November 2017). The payments to the Chief Executive (as an employee) for the year were as follows:

			2021	2020
			£000	£000
Dr T L Barsby	OBE	Remuneration	129	125
		Pension contributions paid	10	11
		Other benefits	13	11

During the year ended 31 March 2021, expenses totalling £ 351 were reimbursed or paid directly to 1 trustee (2020 ‐ £6,484 to 6 trustees) .

Other than the above there are no other related party transactions to be reported in respect of the trustees.

12. Taxation

NIAB 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. Any charges arising in the subsidiary companies are disclosed in Note 16.

There is no provision for deferred tax on fair value adjustments because any chargeable gains are applied to charitable objectives so no tax liability arises.

Page 37

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

13. Intangible assets

Group

Cost At 1 April 2020 Additions Disposals At 31 March 2021 Amortisation At 1 April 2020 Charge for the year At 31 March 2021 Net book value At 31 March 2021 At 31 March 2020	Plant Variety Rights IT Platform £000 £000 1,101 93 250 ‐ (1) ‐ 1,350 93 300 93 70 ‐ 370 93 980 ‐ 801 ‐	Purchased Goodwill £000 418 ‐ ‐ 418 400 18 418 ‐ 18	Total £000 1,612 250 (1)
			1,861
			793 88
			881
			980
			819

Page 38

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021
13. Intangible assets (continued) Charity Cost At 1 April 2020 At 31 March 2021 Amortisation At 1 April 2020 At 31 March 2021 Net book value At 31 March 2021 At 31 March 2020	IT Platform £000 93 93 93 93 ‐ ‐

Included in intangible assets are Plant Variety Rights, Purchased Goodwill arising from the acquisition of the business of ADAS by TAG Consulting Limited, the acquisition of East Malling Research and the development of IT platforms.

Page 39

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

14. Tangible fixed assets

Group

Cost or valuation At 1 April 2020 Additions Disposals At 31 March 2021 Depreciation At 1 April 2020 Charge for the year On disposals At 31 March 2021 Net book value At 31 March 2021 At 31 March 2020	Short‐term Plant, Office & leasehold machinery & Computer property vehicles equipment £000 £000 £000 606 8,525 2,748 ‐ 536 255 ‐ (128) ‐ 606 8,933 3,003 286 5,637 1,975 64 655 379 ‐ (122) ‐ 350 6,170 2,354 256 2,763 649 320 2,888 773	Scientific Assets under equipment construction £000 £000 3,094 51 486 2,636 ‐ ‐ 3,580 2,687 2,134 ‐ 336 ‐ ‐ ‐ 2,470 ‐ 1,110 2,687 960 51	Total £000 15,024 3,913 (128)
			18,809
			10,032 1,434 (122)
			11,344
			7,465
			4,992

Page 40

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

14. Tangible fixed assets (continued)

Charity

Cost or valuation At 1 April 2020 Additions Disposals At 31 March 2021 Depreciation At 1 April 2020 Charge for the year On disposals At 31 March 2021 Net book value At 31 March 2021 At 31 March 2020	Short‐term leasehold property £000 Plant, machinery & vehicles £000 Office & Computer equipment £000 606 7,659 2,512 ‐ 492 255 ‐ (128) ‐ 606 8,023 2,767 286 5,435 1,819 64 572 334 ‐ (122) ‐ 350 5,885 2,153 256 2,138 614 320 2,224 693	Scientific Assets under equipment construction £000 £000 2,349 51 440 627 ‐ ‐ 2,789 678 1,725 ‐ 194 ‐ ‐ ‐ 1,919 ‐ 870 678 624 51	Total £000 13,177 1,814 (128)
			14,863
			9,265 1,164 (122)
			10,307
			4,556
			3,912

The net book value of the group’s and charity's assets includes £441,021 (2020: £996,529) in respect of assets held under finance leases and hire purchase contracts. Depreciation charged in the year on those assets totalled £142,905 (2020: £207,945).

Page 41

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

15. Fixed asset investments Group and Charity Cost or valuation At 31 March 2021 Net book value At 31 March 2021 At 31 March 2020	Trade investments £000
	141
	141
	141

During the course of the year the charity made no investments (2020: £25k) in agritech companies.

Page 42

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

16. Principal subsidiaries

The following were subsidiary undertakings of the Charity:

Names	Company	Charity	Principal activity	Class of
	number	registration		shares
		number
The Arable Group Limited	00192460	212059	Agriculture
TAG Consulting Limited	05110993		Agriculture	Ordinary
NIAB Trading Ltd	07390289		Agriculture	Ordinary
NIAB EMR	09894859	1165055	Horticulture
East Malling Services Ltd.	02335037		Horticulture	Ordinary

The financial results of the subsidiaries for the year were:

Names	Income	Expenditure	Profit/	Net assets/
	£000	£000	Surplus for	(liabilities)
			the year	£000
			£000
The Arable Group Limited	385	(295)	90	113
TAG Consulting Limited	1,341	(1,309)	32	(47)
NIAB Trading Ltd	5,144	(4,321)	523	397
NIAB EMR	7,302	(5,505)	1,797	1,646
East Malling Services Ltd.	2,912	(2,886)	26	496

The Arable Group Limited and NIAB EMR are charitable companies limited by guarantee, considered to be subsidiary undertakings by virtue of control, as NIAB is the sole voting member with the power to appoint the board. TAG Consulting Limited and NIAB Trading Ltd are wholly owned by NIAB. East Malling Services Ltd. was wholly owned by NIAB EMR until 31 March 2021 when ownership was transferred to NIAB following the merger of NIAB EMR's business into NIAB.

All of the subsidiaries carry out activities in furtherance of NIAB's charitable objectives.

Page 43

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

17. Stocks

Raw materials and consumables Finished goods and goods for resale	Group 2021 £000 183 115 298	Group 2020 £000 222 86 308	Charity 2021 £000 98 115 213	Charity 2020 £000 122 86
				208

18. Debtors

Due within one year Trade debtors Amounts owed by group undertakings Other debtors National Institute of Agricultural Botany Trust Prepayments Accrued income	Group 2021 £000 4,040 ‐ 126 ‐ 572 3,327 8,065	Group 2020 £000 3,020 ‐ 166 284 831 2,953 7,254	Charity 2021 £000 2,367 2,779 125 ‐ 441 1,425 7,137	Charity 2020 £000 1,291 2,311 161 284 617 1,481
				6,145

Page 44

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

19. Creditors: Amounts falling due within one year

National Institute of Agricultural Botany Trust Trade creditors Amounts owed to group undertakings Other taxation and social security Obligations under finance lease and hire purchase contracts Other creditors Accruals and deferred income Deferred income at 1 April 2020 Resources deferred during the year Amounts released from previous periods	Group Group 2021 2020 £000 £000 1 ‐ 2,103 1,486 ‐ ‐ 813 501 214 481 2,634 928 6,326 5,764	Charity Charity 2021 2020 £000 £000 1 ‐ 1,803 1,145 687 817 741 422 214 481 1,282 666 4,557 4,167
	12,091 9,160	9,285 7,698 Charity 2021 Charity 2020 £000 £000 2,916 4,205 3,347 2,916 (2,916) (4,205)
	Group 2021 Group 2020 £000 £000 3,824 4,859 4,225 3,824 (3,824) (4,859)
	4,225 3,824	3,347 2,916

Deferred income for the group relates to annual membership subscriptions paid in advance, key renewal dates being 30 September and 31 December, together with pre‐financing payments for EU contracts and payments received in advance for contracted services.

Page 45

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

20. Creditors: Amounts falling due after more than one year

Other loans Net obligations under finance lease and hire purchase contracts Other creditors Obligations under finance leases and hire purchase contracts Within one year Within two to five years		Group 2021 £000 1,500 213 49 1,762 Group 2021 £000 214 213 427	Group 2020 £000 1,500 238 100 1,838 Group 2020 £000 481 238 719	Charity 2021 £000 ‐ 213 23 236 Company 2021 £000 214 213 427	Charity 2020 £000 ‐ 238 23
					261
					Company 2020 £000 481 238
					719

The obligations under finance leases and hire purchase contracts are secured by a charge over the assets financed.

The loan of £1,500,000 is from the National Institute of Agricultural Botany Trust, a related party. Further details of this loan are disclosed in note 31.

Page 46

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

21. Financial instruments

	Group	Group	Charity	Charity
	2021	2020	2021	2020
	£000	£000	£000	£000
Financial assets
Financial assets measured at fair value through
income and expenditure	3,655	705	1,674	606

Financial assets measured at fair value through income and expenditure comprise foreign currency forward contracts. These are not traded in active markets and have been fair valued using observable forward exchange rates corresponding to the maturity of the contract.

Financial assets that are debt instruments measured at amortised cost comprise trade debtors, amounts owed by NIAB Trust and other debtors.

Page 47

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

22. Statement of funds

Statement of funds ‐ current year

Expenditure £000 (21,540) 111 (21,429) ‐ (60) ‐ (6,007)	Transfers in/out £000 1,998 ‐ 1,998 ‐ ‐ ‐ (1,998)	Balance at 31 March 2021 £000 5,753 (19,225)
		(13,472)
		750 242 6 ‐
(6,067) (27,496)	(1,998) ‐	248
		(12,474)

During the year the NIAB EMR (a subsidiary charity) received restricted grants totalling £1,998k for the purchase of specified fixed assets. Once purchased, the fixed assets form part of the unrestricted assets and a transfer has therefore been made.

Page 48

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

22. Statement of funds (continued)

Statement of funds ‐ prior year

Expenditure £000 (23,327) 5,141 (18,186) ‐ (60) ‐ (5,101)	Transfers in/out £000 817 ‐ 817 ‐ ‐ ‐ (817)	Balance at 31 March 2020 £000 2,163 (13,987)
		(11,824)
		750 302 6 ‐
(5,161) (23,347)	(817) ‐	308
		(10,766)

The John Oldacre Foundation fund is an amount held as capital where only income can be spent. The expenditure is restricted to funding post‐graduate studentships of young innovators.

The Hasse Fen capital fund was a grant received to build at NIAB's Hasse Fen site. The expenditure represents annual depreciation of the asset.

Page 49

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

23. Analysis of net assets between funds

Analysis of net assets between funds ‐ current year

Analysis of net assets between funds ‐ current year
Tangible fixed assets Intangible fixed assets Trade investments Current assets Creditors due within one year Creditors due in more than one year Defined benefit pension scheme liability Total	Unrestricted funds 2021 £000 7,217 980 141 11,268 (12,091) (1,762) (19,225)	Restricted funds 2021 £000 248 ‐ ‐ ‐ ‐ ‐ ‐ 248	Endowment funds 2021 £000 ‐ ‐ ‐ 750 ‐ ‐ ‐ 750	Total funds 2021 £000 7,465 980 141 12,018 (12,091) (1,762) (19,225)
	(13,472)			(12,474)

Analysis of net assets between funds ‐ prior year

Analysis of net assets between funds ‐ prior year
Tangible fixed assets Intangible fixed assets Trade investments Current assets Creditors due within one year Creditors due in more than one year Defined benefit pension scheme liability Total	Unrestricted funds 2020 £000 4,684 819 141 7,517 (9,160) (1,838) (13,987)	Restricted funds 2020 £000 308 ‐ ‐ ‐ ‐ ‐ ‐ 308	Endowment funds 2020 £000 ‐ ‐ ‐ 750 ‐ ‐ ‐ 750	Total funds 2020 £000 4,992 819 141 8,267 (9,160) (1,838) (13,987)
	(11,824)			(10,766)

Page 50

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

24. Reconciliation of net movement in funds to net cash flow from operating activities

Net income for the year (as per Statement of Financial Activities) Adjustments for: Depreciation charges Amortisation charges Profit on the sale of fixed assets Decrease/(increase) in stocks Decrease/(increase) in debtors Increase/(decrease) in creditors Interest payable Pension contributions Pension ‐ past service cost Net cash provided by operating activities	Group Group 2021 2020 £000 £000 3,641 3,544
	1,434 1,217 88 104 (18) (55) 10 (4) (811) 311 3,147 (39) 45 70 (111) (317) ‐ (4,824)
	7,425 7

25. Analysis of cash and cash equivalents

Cash in hand Total cash and cash equivalents	Group 2021 £000 3,655 3,655	Group 2020 £000 705
		705

Page 51

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

26. Analysis of changes in net debt

Cash at bank and in hand Debt due within 1 year Debt due after 1 year Finance leases	At 1 April 2020 Cash flows At 31 March 2021 £000 705 ‐ £000 £000 2,950 3,655 (1) (1) (1,500) ‐ (1,500) (719) 292 (427)
	(1,514) 3,241 1,727

Page 52

NIAB

For the Year Ended 31 March 2021

Notes to the Financial Statements

27. Pension commitments: Defined Benefit schemes

(A) NIAB Defined Benefit Pension Scheme

NIAB operates a defined benefit pension scheme which was established on 1 April 1996. The assets of this scheme are held in a separate fund controlled by trustees. The scheme was closed to future benefit accrual on 31 July 2007.

The most recent actuarial valuation of the Scheme was carried out as at 31 March 2015. The valuation has been updated to 31 March 2018 by a qualified independent actuary.

NIAB expects to contribute £700,000 to its defined benefit pension scheme in 2021/22 (2020/21: £700,000).

The amounts recognised in the balance sheet are as follows:

Present value of funded obligations Fair value of plan assets Deficit	2021 £000 (50,033) 30,808	2020 £000 (43,939) 29,952
	(19,225)	(13,987)

Included in the deficit is £Nil (2020‐ £Nil) which is a provision for Guaranteed Minimum Pension equalisation.

As part of the recent funding negotiations the Pension Fund Trustees and the charity agreed that, from 1 April 2020 onwards, pensions in payment will now increase in line with CPI rather than RPI. Increases will continue to be capped at 5% pa for pensions accrued pre 1 April 2006 and 2.5% pa for pensions accrued thereafter. That change has resulted in a reduction in the present value of the defined benefit obligation. The amounts recognised in the net income and expenditure are as follows:

Administration costs incurred during the period Net interest cost Past service cost Total pension expense	2021 £000 303 303 ‐	2020 £000 376 400 (4,824) (4,048)
	606

Page 53

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

27. Pension commitments: Defined Benefit schemes (continued)

The amounts in the statement of other movements in funds are:

Actuarial gain/(loss) on plan assets Actuarial (loss) on defined benefit obligation of which due to experience of which due to demographic assumptions of which due to financial assumptions Total (loss) in other movements in funds	2021 2020 £000 £000 1,401 (116) (6,750) (239) 575 422 63 (63) (7,388) (598) (5,349) (355)

Changes in the present value of the defined benefit obligations are:

Liabilities at the start of the period Interest cost Actuarial gain Benefits paid Past service cost Liabilities at the end of the period Changes in the fair value of plan assets are: Fair value of plan assets at start of the period Interest income Actuarial gain/(loss) Contributions by the employer Benefits paid Non‐investment expenses Fair value of plan assets at end of the period Interest income Actuarial gain/(loss) on plan assets Return on plan assets	2021 £000 43,939 949 6,750 (1,605) ‐	2020 £000 48,637 1,140 239 (1,253) (4,824) 43,939 2020 £000 29,864 740 (116) 1,093 (1,253) (376)
	50,033 2021 £000 29,952 646 1,401 717 (1,605) (303)
	30,808	29,952
	2021 £000 646 1,401 2,047	2020 £000 740 (116) 624

Page 54

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

27. Pension commitments: Defined Benefit schemes (continued)

Major categories of plan assets as a percentage of total assets

Equities Diversified Growth Fund Bonds Cash Total	2021 £000 6,553 10,832 7,723 5,700	2021 % 21.3 35.1 25.1 18.5	2020 £000 4,854 9,209 8,949 6,940	2020 % 16.2 30.7 29.9 23.2 100.0
	30,808	100.0	29,952

Principal actuarial assumptions at the balance sheet date:


Discount rate	2.0%	2.2%
Rate of increase in salaries	2.7%	2.0%
Rate of increase in pensions	2.7%	2.1%
Rate of inflation RPI	3.3%	2.8%
Rate of inflation CPI	2.7%	2.0%
Life expectancies:
Current pensioners age 65 ‐ males	21.8	21.8
Current pensioners age 65 ‐ females	24.1	24.1
Future pensioners age 65 (currently age 45) ‐ males	22.8	22.8
Future pensioners age 65 (currently age 45) ‐ females	25.3	25.2

Experience of gains and losses

Liabilities at the end of the year Assets at the end of the year Deficit at the end of the year Asset (loss)/gain % of scheme assets Liability gain/(loss) % of scheme assets	2021 2020 £000 £000 (50,033) (43,939) 30,808 29,952
	(19,225) (13,987)
	1,401 (116) 4.5% ‐0.4% (6,750) ‐13.5% 239 ‐0.5%

Page 55

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

27. Pension commitments: Defined Benefit schemes (continued)

(B) Universities Superannuation Scheme

Liability less than 1 year Liability more than 1 year Total	2021 £'000 3 26 29	2020 £'000 2 36
		38

The USS pension scheme is only available to certain of the employees of The Arable Group Limited. Since that charity cannot identify its share of the assets and liabilities of the USS scheme, the following disclosures have been provided by the pension scheme to reflect those relevant for the scheme as a whole.

Universities Superannuation Scheme (USS )

Following changes to the USS, this scheme now comprises two parts, USS Retirement Income Builder which is a defined benefit arrangement and USS Investment Builder which is a defined contribution arrangement. The latest formal actuarial valuation of the USS defined benefit liabilities has been carried out as at 31 March 2018 to meet the requirements of the Pensions Act 2004 and was published in September 2019. This actuarial valuation shows a shortfall of £3.6bn in the USS with the scheme assets being sufficient to cover 95% of its ‘technical provisions’ liabilities.

Based on this valuation the actuary has determined that USS funding rates will increase from the current total of 26% of salaries (employer 18%, employee 8%) to 34.7% of salaries (employer 23.7%, employee 11.0%) in stages up to 1 October 2021. These contribution rates include:

provisions for the employer cost of future accruals of DB benefits,
contributions of2% from 1 October 2019 increasing to 6% from 1 October 2021 towards the correction of
the DB past service deficit,
contributions of 0.4% to cover certain administrative expenses and PPF levies, and
the employer contributions towards DC benefits.

The past service deficit contributions are expected to correct the deficit by 30 June 2028 if experience is borne out in line with the assumptions made for the recovery plan. To reflect the liability for these contributions the Institute has used a financial modeller to calculate the provision it needs to recognise in the financial statements. The calculated amount is recognised in the balance sheet and any changes in the value of the deficit liability each year are shown on the Statement of Financial Activities. The assumptions used as part of this modelled for the year ended 31 March 2021 are shown below.

Further details on, and a copy of, the 2018 Actuarial Valuation of the USS can be found on the USS website.

Page 56

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

27. Pension commitments: Defined Benefit schemes (continued)

Further information on the 2018 actuarial valuation of the USS Scheme is included below.

Of The Arable Group Limited's 4 employees at 31 March 2021 (2020: 5), 1 was a member of USS (2020: 2).

The Arable Group Limited’s calculated share of the USS defined benefit pension liability amounts to £29k (2020: £38k) and the total cost charged to the Statement of Financial Activities in respect of USS amounts to £8k (2020: £16k).

The liability has been re‐calculated using the USS model provided with reference to the remaining deficit recovery period of 10 years from 2018 to 2028. Since the group cannot identify its share of the assets and liabilities of the USS scheme, the following disclosures have been provided by the pension scheme to reflect those relevant for the scheme as a whole.

The following assumptions were used to calculate the group’s share of the USS liability:

	2021	2020
Discount rate	2.3%	2.3%
Projected salary inflation	2.7%	2.7%

Salary inflation assumptions take into account the level of annual pay increases set in the April before the relevant year‐end, prevailing CPI rates, and the Bank of England long‐term inflation target of 2%. The calculation reflects an assumption that there would be some reduction in member numbers in the forward years. The assumptions underpinning the calculation reflect a prudent assessment of the available information and options but represents a key area of estimation uncertainty in the financial statements.

Analysis of the charge to the income and expenditure statement is set out below:

Employer contributions Contributions allocated to deficit provision Change in contributions from past expectations Contribution costs total Interest payable Pension costs total	2021 2020 £'000 £'000 17 22 (1) 1 (9) (9) 7 14 1 2 8 16
	7 1
	8

Defined benefit liability numbers for the scheme have been produced using the following assumptions:


Discount rate	2.3%	2.3%
Pensionable salary growth	n/a	n/a
Pension increases (CPI)	2.7%	2.7%

Page 57

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

27. Pension commitments: Defined Benefit schemes (continued)

The main demographic assumption used relates to the mortality assumptions. These assumptions have been updated for the 31 March 2018 position, based on updated analysis of the Scheme’s experience carried out as part of the 2017 actuarial valuation. The mortality assumptions are based on the following mortality tables:

	2018	Pre‐retirement	Post‐retirement
Male members mortality		71% of AMC00	97.6% of SAPS
		(duration 0)	S1NMA "light"
Female members mortality		112% of AMFG00	102.7% of RFV00
		(duration 0)
	2017
Male members mortality		98% of S1NA
		("light" YoB tables
		‐ No age rating
Female members mortality		99% of S1NA
		("light" YoB tables
		‐ rated down 1
		year No age rating

Future improvements to mortality are based on the Continuous Mortality Investigation’s (CMI) 2017 projections with smoothing parameter of 8.5 and a long‐term improvement rate of 1.8% for males and 1.6% for females.

The current life expectancies on retirement at age 65 are:


Males currently aged 65 years	24.4	24.4
Females currently aged 65 years	26.3	26.3
Males currently aged 45 years	25.9	25.9
Females currently aged 45 years	27.7	27.7

Summary of the Scheme position as at 31 March is set out below:

	2021	2020	2019
Scheme assets	£80.6bn	£66.5bn	£67.4bn
Total scheme liabilities	£95.8bn	£79.4bn	£72.8bn
FRS102 Total scheme deficit	£15.2bn	£12.9bn	£5.4bn
FRS102 Total funding level	84%	84%	93%

Page 58

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2021

28. Operating lease commitments

At 31 March 2021 the Group and the Charity had commitments to make future minimum lease payments under non‐cancellable operating leases as follows:

Not later than 1 year Later than 1 year and not later than 5 years	Group 2021 £000 745 1,616 2,361	Group 2020 £000 818 710 1,528	Charity 2021 £000 734 1,616 2,350	Charity 2020 £000 393 429
				822

The following lease payments and changes in lease payments have been recognised in the Statement of Financial Activities:

Land and Buildings Motor vehicles	Group 2021 £000 728 180 908	Group 2020 £000 760 220 980	Charity 2021 £000 267 135 402	Charity 2020 £000 272 173
				445

29. Capital commitments

Improvements to the charity's Hasse Fen site costing £600k were completed in April 2021. The works remained the property of the supplier until paid for. As the invoice was not received and settled until May 2021, the additions will be reflected in the accounts for the year to 31 March 2022.

30. Members' liability

The charitable company is incorporated as a company limited by guarantee having no share capital and, in accordance with the Memorandum of Association, every member is liable to contribute a sum of £1 in the event of the company being wound up. At 31 March 2021 there were eleven members, comprising the Trustees.

Page 59

NIAB

Notes to the Financial Statements

For the Year Ended 31 March 2021

31. Related party transactions

In the ordinary course of business the company entered into transactions with National Institute of Agricultural Botany Trust. The company has a close relationship with National Institute of Agricultural Botany Trust, which has an object to support NIAB.

During the course of the year NIAB is charged a facilities charge for the occupation of the land and buildings owned by the Trust, and the Trust receives a charge from NIAB relating to the Research Funding Agreement between the two parties. These transactions will be represented by both cash and non‐cash, due to accruals made for activities at the end of the financial year.

These transactions are summarised below:

	2021	2020
	£000	£000
Closing (creditor)/debtor	(1)	284
Annual support	1,125	1,125
Additional support towards pension costs	500	700
Contribution towards other costs	‐	128
Expenditure	(500)	(500)

In 2017 NIAB EMR, a subsidiary company, obtained a loan of £1,500,000 from National Institute of Agricultural Botany Trust. This loan is secured by a first fixed and floating charge on the assets of NIAB EMR and, while there is no fixed repayment timetable, the loan is repayable in full by 8 February 2026. Interest is charged at 2% above the Bank of England base rate, which is considered to be a market value.

The charitable company has taken advantage of the exemptions contained within FRS102, section 33, not to disclose intra‐group transactions on the basis that the subsidiaries are wholly owned and the accounts are publicly available.

32. Post balance sheet events

On 1 April 2021 the business, assets and liabilities of NIAB EMR (a subsidiary) were merged into the parent company, NIAB.

33. Parent charity result

The parent charity result for the year before other recognised gains and losses and before charges or credits to the pension fund cost was a profit of £1,207k (2020: loss £788k).

Page 60

NIAB

Contents

Reference and Administrative Details of the Charity, its Trustees and Advisers For the Year Ended 31 March 2021

Reference and Administrative Details of the Charity, its Trustees and Advisers (continued) For the Year Ended 31 March 2021

TRUSTEES’ REPORT INCORPORATING THE STRATEGIC REPORT

STRATEGIC REPORT

Background

Public Benefit

Mission and Vision

Strategy

Performance

NIAB | Annual Report and Accounts | March 2021

Objectives for 2021/22

FINANCIAL REVIEW

Income

Expenditure

Capital Expenditure

Business Review and key performance indicators

Going Concern

NIAB | Annual Report and Accounts | March 2021

Subsidiaries and related parties

Reserves Policy

Accounting Period

RISK ASSESSMENT AND MANAGEMENT

Principal Risks and Uncertainties

STRUCTURE, GOVERNANCE and MANAGEMENT

Members and Board of Trustees

Trustee Remuneration

Recruitment, induction and training of Trustees

Organisation and governance

Decision making and key management

Employees

Liability Insurance

Independent Auditors' Report to the Members of NIAB

Opinion

Basis for opinion

Conclusions relating to going concern

Other information

Independent Auditors' Report to the Members of NIAB (continued)

Opinions on other matters prescribed by the Companies Act 2006

Matters on which we are required to report by exception

Responsibilities of trustees

Auditor’s responsibilities for the audit of the financial statements

Independent Auditors' Report to the Members of NIAB (continued)

Extent to which the audit was considered capable of detecting irregularities, including fraud

Use of our report

Naziar Hashemi

London

Consolidated Statement of Financial Activities (incorporating income and expenditure account) For the Year Ended 31 March 2021

Consolidated Balance Sheet As at 31 March 2021

Charity Balance Sheet As at 31 March 2021

NIAB

Consolidated Statement of Cash Flows For the Year Ended 31 March 2021

1. General information

2. Accounting policies

2.1 Basis of preparation of financial statements

2.2 Fund accounting

2. Accounting policies (continued)

2.3 Incoming resources

Income from charitable activities:

Trading activities:

Investment income:

Income Tax recoverable:

Capital grant income:

2.4 Coronavirus Job Retention Scheme

2.5 Accrued and deferred income

Notes to the Financial Statements

2. Accounting policies (continued)

2.6 Expenditure

Charitable Activities:

Support costs:

Governance costs:

2.7 Intangible assets and amortisation

IT platform

Purchased goodwill

Plant variety rights

2.8 Tangible fixed assets and depreciation

Notes to the Financial Statements

2. Accounting policies (continued)