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2022-03-30-accounts

Registered number: 3395389 Charity number: 1064230

NIAB

Trustees' Report and Financial Statements

For the Year Ended 31 March 2022

NIAB

Contents

Page
Reference and Administrative Details of the Charity, its Trustees and Advisers 1 ‐ 2
Trustees' Report 3 ‐ 11
Independent Auditors' Report on the Financial Statements 12 ‐ 15
Consolidated Statement of Financial Activities 16 ‐ 17
Consolidated Balance Sheet 18 ‐ 19
Charity Balance Sheet 20 ‐ 21
Consolidated Statement of Cash Flows 22
Notes to the Financial Statements 23 ‐ 63

NIAB

Reference and Administrative Details of the Charity, its Trustees and Advisers For the Year Ended 31 March 2022

Trustees J E GodfreyOBE,Chairman
Professor M J Caccamo,Chief Executive(appointed 1 October 2021)
Dr T L Barsby,OBE,BSc,Chief Executive(resigned 18 November 2021)
S J Ellwood,BSc
Dr H Ferrier,BSc,MSc
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
Professor A G Smith,BSc,MPhil,PhD
Dr G H Smith(appointed 18 November 2021)
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
Moore Kingston Smith LLP
Statutory Auditors
9 Appold Street
London
EC2A 2AP
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 2022

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 2022

TRUSTEES’ REPORT INCORPORATING THE STRATEGIC REPORT

The Trustees note with great sadness the passing of our Patron, Her Majesty Queen Elizabeth II, on the 8th September 2022.

Her Majesty took a keen interest in the work of NIAB, most recently spending time with us to mark the occasion of our organisation's Centenary in 2019.

STRATEGIC REPORT

Background

NIAB is an internationally recognised leader in applied crop research and innovation, providing an integrated innovation and knowledge transfer hub addressing the global challenges of food production, climate change and environmental protection.

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

The National Institute of Agricultural Botany was founded by Deed of Trust in 1919. It was regulated by a scheme made by the UK Government 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 (Charity No. 1144528) (The Trust) provides land, facilities and financial support to NIAB, which The Trust determines 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 and breeding new plant varieties, through to the extensive trials data, agronomy expertise and advice needed to ensure these advances are transferred effectively to the wider industry. From a position of independence NIAB supports the delivery of government policies relevant to food production, protection of the environment and mitigation of climate change.

Mission and Vision

Our mission is to provide independent, science-based research and information to support, develop and promote agriculture and horticulture; helping the industry to fulfil its potential in supplying food and renewable resources, while respecting the natural environment.

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 to deliver profitable and sustainable crops.

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 and horticulture.

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. 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 on-farm 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.

3

NIAB | Annual Report and Accounts | March 2022 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:

commercial organisations in the UK, Europe and the rest of 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 Charity Commission. Based on this guidance, and as described in this Trustees’ report, the Trustees believe the activities of NIAB to be charitable in nature.

4

NIAB | Annual Report and Accounts | March 2022

Performance

Performance against the 2021/22 objectives is highlighted in the table below:

Objectives Performance
Deliver the 5-year plan 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.		 After the disruption of the covid-19 pandemic, better than
expected royalty revenue from plant variety rights and one-
off research support helped to deliver an operating surplus
of £315k in the year. In addition, grant income for capital
purchases of £9,952k resulted in a surplus, before
adjustment for the defined benefit pension scheme, of
£10,267k for the year.
Deliver new facilities at East Malling. Construction of a new glasshouse, a reception building, and a
wine innovation centre was delivered on time and on
budget, 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 positively impact the
research at NIAB.
Establish NIAB España, to enable NIAB to develop a presence
in the European fruit market centred around Huelva province
in Spain		 NIAB España registered. The strategy on engagement with
key growers to establish NIAB in the region will be a key
objective in 2022/23.
Restore external communications and events to pre-Covid
levels as far as possible		 NIAB continued to deliver events to members, with a return
to a full program of activities and open events in the 2022
season.
Successful transition to a new CEO, Professor Caccamo,
following Professor Barsby’s retirement.		 Professor Caccamo took over as CEO in October 2021 and
has successfully transitioned into the role.
Embed the Crop Science Centre, the alliance with the
University of Cambridge, recruit science leaders, and secure
new sources of funds.		 The Crop Science Centre is now established, with funding
secured from several sources, including Bill and Melinda Gates
Foundation. Three research leaders recruited in 2021/22.

5

NIAB | Annual Report and Accounts | March 2022 Objectives for 2022/23

NIAB is addressing the following objectives for the year to 31 March 2023:

5

NIAB | Annual Report and Accounts | March 2022

FINANCIAL REVIEW

Income

The total incoming resources for the group were £41,843k (2021: £31,137k). A total of £13,564k related to Agricultural Services (2021: £10,050k) and £19,542k related to Laboratory and Research (2021: £12,559k), including £10,062k from capital grants. The income relating to commercial trading operations totalled £7,505k (2021: £7,829k). The group does not carry out fundraising activities.

Expenditure

The total outgoing expenditure was £31,566k (2021: £27,496k).

Capital Expenditure

The charity funded the capital purchases from both restricted grants and unrestricted income. The total group spend was £10,110k (2021: £3,913k).

FRS102 requires income from capital grants to be recognised when awarded and there are no conditions to be met that are outside of the control of NIAB, with depreciation charged when the asset concerned is brought into use. To distinguish operating activity from income and depreciation relating to capital grants, income and expenditure from operations is shown separately on the face of the SOFA.

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: - eviewed for the group: -
Charitable and trading Income 2022
£31,781k		 2021
£28,135k
(excluding
capital		 grants
£10,062k – 2021: £2,440k)
Staff Costs (before pension past £15,535k £15,207k
service cost adjustment)
Average Staff Numbers 366 361
Turnover per head (excluding £86.8k £77.9k
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.

The Group’s operating activities are diverse. Research and development in Crop Genetics, Computational Biology, Plant Breeding and Plant Characterisation are supported by longterm 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 in the current year results.

The Group balance sheet shows a deficit of £588k (2021: £12,474k). Taking out the Restricted and Endowment funds leaves an Unrestricted deficit of £13,972k (2021: £13,472k). Stripping out the pension scheme deficit of £17,405k (2021: £19,225k) (discussed in more detail below), the long-term debt to The Trust of £1,500k and Fixed Assets (Tangible plus Intangible) plus Trade investments in total within Unrestricted funds of £4,313k (2021: £8,338k) leaves an underlying unrestricted reserve of £620k (2021: negative £1,085k) as described in the Reserves policy in this report.

In the year, NIAB benefited from some one-off grants and higher than anticipated revenues from commercial crop sales. Given the nature of this income, and with the changes in the current economy, particularly higher inflation, NIAB has undertaken an exercise of reviewing income and direct expenditure, to identify areas of the organisation that are most sensitive to changes and under-performing financially. The results have been used as a basis from which to formulate a model for strategic planning over the next 5 years. A key component of the revised 5-year plan is to create surpluses through improved margins on services and products.

The Trust was established with similar charitable objects to NIAB and fulfils its charitable objects through the provision of support to NIAB. A key component of the review of going concern, given other uncertainties, is the support from The Trust.

At the time of writing this report, the forecast for 2022/23 is for an operational deficit. NIAB will therefore be dependent on the support of The Trust to remain a going-concern during 2022/23 and into 2023/24. Beyond this, NIAB expects to be in a sustained operational surplus position year-on-year.

5

NIAB | Annual Report and Accounts | March 2022

Subsidiaries and related parties

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 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 payments agreed under the recovery plan. A new recovery plan, based on the triennial valuation at 31 March 2021 has been agreed with the Pension Scheme Trustees and submitted to The Pensions Regulator for approval.

The Trust has a balance sheet value of in excess of £55m. 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:

  1. The cash flow forecast and latest management accounts, which give confidence that NIAB can continue to pay its debts as they fall due.

  2. The Trust’s continued support to NIAB through the provision of facilities and funding and borrowing support.

  3. 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.

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 2021/22 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 months’ worth of unrestricted fund expenditure. At the current annual spend, the reserves target is therefore between £5m and £10m.

At 31 March 2022 group unrestricted reserves excluding fixed assets and pensions liability and the long-term loan from the NIAB Trust, were positive £620k (2021: negative £1,085k), 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 improved margins on services and products, thereby increasing the general reserves position. At the time of writing this report, the forecast for 2022/23 is for an operational deficit.

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 2022. 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.

8

NIAB | Annual Report and Accounts | March 2022

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
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 Business disruption caused by instrument/system failure Replacing the building & equipment monitoring and
finance systems are a current priority.
Strategy / Process Loss of Trials Land and farm relocation The Trust providing interim funding for a New Farm Hub
and Trials Land.
Potential site identified and Landlord progressing planning
permission.
Customer Loss of higher margin revenue streams Concerns over loss of higher margin revenue streams.
NIAB is maintaining conversations with key emerging
growers groups (e.g., Potatoes GB) to ensure retention of
funding to support on-farm research following loss of AHDB
levy funding.
Customer Loss of key personnel leading to loss of confidence by
customers and inability to deliver key services.		 Performance related pay structure and quarterly Pay &
Reward reviews are in place to reward key staff, Talent
management program is being implemented,
Supplier Commodity price increases Increasing energy and commodity prices are impacting on
business finances. Reviewing pricing structure for both
commercial and research projects to absorb higher costs.
Financial Pension Scheme deficit 2021 Triennial valuation agreed with the Pension Trustees.
The Trust is now a participating employer in the scheme,
improving the employers covenant and the ability to fund
the required annual deficit contributions.

10

NIAB | Annual Report and Accounts | March 2022 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.

The following Trustees have served during the period:

J E Godfrey, OBE (retiring 17 November 1, 2 Chairman
2022)
Professor T L Barsby, OBE, BSc (retired
18 November 2021)
Professor M J Caccamo (appointed 1
October 2021)
S J Ellwood, BSc 1, 2
Dr H Ferrier BSc, MSc
K E Fidgeon, FCA 1
Dr N Kerby, MBE, BSc 1
Dr C A Lang, BA 2
R C Lowson
Professor I J Puddephat, BSc PhD
J P Regan
Dr G H Smith (appointed 18 November
2021)
Professor A G Smith BSc, MPhil, PhD 2

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

Trustee Remuneration

NIAB provides an honorarium for the Chair of the Board, and the Chair 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 366 (2021: 361). 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 are 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 affected 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.

10

NIAB l Annual Report and Accounts l March 2022 STATEMENT OF TRUSTEES RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT AND FINANCIAL STATEMENTS The Trustees Iwho are also directors of NIAB for the purposes of company lawl are responsible for preparing the Trustees. Report, illcorporating 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 accuracy at any time the financial p051tion of the ch31itable group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the asset5 of the ch3ritsble group and hence for taking reasonable step5 for the prevention and detection of fraud and other irregularities. Company law requires the Trustee5 tts prepare financial statements for each financial year. Under that law the Trustees have elected to prepare the financial statements in accordance with United Kingdom General Accepted Accounting Practise Iunited Kingdom accounting stand3rds and applicable lawl, including FR5102, the financial reporting standard applicable in the UK and Republic of Ireland. Under company law the Trustees must not approve the financial st3ternent5 unless th3t they are s3tisfied that they give a 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 statements, the Trustees are required to.. The Trustees confirm that.. so far as each Trustee is aware, there is no relevant audit information of which the auditors are unaware,. and the Trustees have taken all the steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit inforrnation and to establish that the charitable group's auditor is aware of that information. The Trustees are re5poNsible for the maintenance and integrity of the corporate financial information included on the charitable group's website. Legislation in the United K1n8dom governing the preparation and dissemination of financial statements rnay differ frorn legislation in other jurisdictions. select suitable accounting policies and then applv them cons1St8rTrtlv. observe the methods and principles in the Charities SORP IFRS1021.' The Trustees approve the Trustees, Report, incorporating the Strategic Report, and fin3ncial statements which are signed on behalf of the Board of Trustees of NIAB. make judgment5 and accounting estimates that are reasonable and prudent., state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements- and J E Godfrey, Chair Date.. 17 November 2022 an prepare the financial statements on the going concern basis unle55 It is inappropriate to PTe5urne that the charity will continue in business. li

NIAB

Independent Auditors' Report to the of NIAB

Opinion

We have audited the financial statements of NIAB (the ‘parent charitable company’) and its subsidiaries (the ’group’) for the year ended 31 March 2022 which comprise Group Statement of Financial Activities (incorporating the Group Summary Income and Expenditure Account), the Group and Parent Charitable Company Balance Sheets, the Group Cash Flow Statement 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:

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 charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the 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 and parent charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

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

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

We have nothing to report in this regard.

Page 12

NIAB

Independent Auditors' Report to the 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 the audit:

Matters on which we are required to report by exception

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

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

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 group and parent 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 group or parent 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Page 13

NIAB

Independent Auditors' Report to the of NIAB (continued)

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

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

The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the charitable company.

Our approach was as follows:

Page 14

NIAB

Independent Auditors' Report to the of NIAB (continued)

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

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 which 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 any party other than the charitable company and charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Andrew Stickland (Senior statutory auditor)

for and on behalf of

Moore Kingston Smith LLP

Statutory Auditors

9 Appold Street London EC2A 2AP

24 November 2022

Page 15

Total funds 2021 £000 500 - 22,746 7,829 62 31,137 8,176 19,320 27,496 3,641 - 3,641 Page 16
Total funds 2022 £000 500 600 62 33,120 7,505 56 41,843 10,339 21,227 31,566 10,277 (10) 10,267
Unrestricted
Restricted
Endowment
Total
Restricted		 funds
funds
funds
operating
capital		 Notes
funds
grant funds		 2022
2022
2022
2022
2022		 £000
£000
£000
£000
£000		 Income and endowments from: Donations to NIAB
3		 Funding towards pension deficit
-
500
-
500
-		 Provision of facilities
600
-
-
600
-		 Other donations
62
-
-
62
-		 Charitable activities
4
15,841
7,217
-
23,058
10,062		 Other trading activities
5
7,505
-
-
7,505
-		 Investments
6
56
-
-
56
-		 Total income and endowments
24,064
7,717
-
31,781
10,062		 Expenditure on: Trading activities
10,339
-
-
10,339
-		 Charitable activities
7
13,400
7,717
-
21,117
110		 Total expenditure
23,739
7,717
-
31,456
110		 Net income before net losses on investments
325
-
-
325
9,952		 Net losses on investments
(10)
-
-
(10)
-		 Net income (carried forward)
315
-
-
315
9,952		 The notes on pages 28 to 62 form part of these financial statements.

Total funds 2021 £000 3,641 - 3,641 (5,349) (1,708) 10,766) (12,474)
Total funds 2022 £000 10,267 - 10,267 1,619 11,886 (12,474) (588)
Unrestricted
Restricted
Endowment
Total
Restricted		 funds
funds
funds
operating
capital		 Notes
funds
grant funds		 2022
2022
2022
2022
2022		 £000
£000
£000
£000
£000		 Net income (brought forward)
315
-
-
315
9,952		 Transfers between funds
22
(2,434)
-
-
(2,434)
2,434		 Net movement in funds before other recognised gains/(losses)
(2,119)
-
-
(2,119)
12,386		 Other recognised gains/(losses) Actuarial gains/(losses) on defined benefit pension schemes
1,619
-
-
1,619
-		 Net movement in funds
(500)
-
-
(500)
12,386		 Reconciliation of funds Total funds brought forward
(13,472)
-
750
(12,722)
248		 Total funds carried forward
(13,972)
-
750
(13,222)
12,634		 The Consolidated Statement of Financial Activities includes all gains and losses recognised in the year. The notes on pages 28 to 62 form part of these financial statements.

NIAB Registered number: 3395389

Consolidated Balance Sheet As at 31 March 2022

Note
Fixed assets
Intangible assets
13
Tangible assets
14
Investments
15
Current assets
Stocks
17
Debtors
18
Cash at bank and in hand
Creditors: amounts falling due within one year
19
Net current assets/(liabilities)
Total assets less current liabilities
Creditors: amounts falling due after more than
one year
20
Net assets excluding pension liability
Defined benefit pension scheme liability
27
Total net (liabilities)		 2022
£000
330
10,574
2,005
12,909
(11,322)		 2022
£000
887
15,915
145
16,947
1,587
18,534
(1,717)
16,817
(17,405)
(588)		 2021
£000
298
8,065
3,655
12,018
(12,091)		 2021
£000
980
7,465
141
8,586
(73)
8,513
(1,762)
6,751
(19,225)
(12,474)

Page 18

NIAB Registered number.. 3395389 Consolidated Balance Sheet Icontinuedl As at 31 March 2022 2022 £000 2022 £000 2021 £000 2021 Note Charity funds Endowment funds 22 750 750 Restricted capital grant funds Unrestricted funds 22 12,634 G@nèTal funds 22 3,433 117,4051 5,753 (19,2251 Pension reserve 22 Total unrestricted funds 22 113,9721 113,472) Total funds 15881 (12,474) The Trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting record5 and preparation of financial statements. The financial statements were approved and authorised for issue by the Trustees on 17 November 2022 and signed on their behalf by- J E Godfrey OBE Director Professor M J Caccamo Director The note5 on pa8e5 23 to 63 form part of these financi31 staternents. Page ig

NIAB Registered number: 3395389

Charity Balance Sheet As at 31 March 2022

Note
Fixed assets
Intangible assets
13
Tangible assets
14
Investments
15
Current assets
Stocks
17
Debtors
18
Cash at bank and in hand
Creditors: amounts falling due within one year
19
Net current liabilities
Total assets less current liabilities
Creditors: amounts falling due after more than
one year
20
Net assets excluding pension liability
Defined benefit pension scheme liability
27
Total net assets		 255
7,594
1,419
9,268
(10,452)		 2022
£000
887
15,842
145
16,874
(1,184)
15,690
(1,675)
14,015
(17,405)
(3,390)		 213
7,137
1,674
9,024
(9,285)		 2021
£000
‐
4,556
141
4,697
(261)
4,436
(236)
4,200
(19,225)
(15,025)

Page 20

NIAB Registered number- 3395389 Charity Balance Sheet Icontinuedl As at 31 March 2022 2022 £000 2021 £000 Note Charity funds Endowment funds 22 750 750 Restricted capital grant fund5 Unrestricted funds 22 10,861 248 General funds 22 2A04 117.4051 3,202 119,225) Pension reserve 22 Total unrestricted fund5 22 115.0011 116,023) Total funds 13,3901 115,025) The Charity has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and ha5 not presented its own Statement of Financial Activities in these financial statemenst. The Trustee5 acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and prepar8tion of financial statements. The f5nanclal statements were aPPToved and authorised for issue by the Trustees on 17 November 2022 and signed on their behalf bv.. J E Godfrey OBE Director Professor M I Caccamo Director The note5 on pages 23 to 63 form part of thése financial statements. Page 21

NIAB

Consolidated Statement of Cash Flows For the Year Ended 31 March 2022

Note
Cash flows from operating activities
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
New finance leases
Interest paid
Net cash used in 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		 2022
£000
8,157
431
‐
(10,110)
(14)
(9,693)
‐
(227)
146
(33)
(114)
(1,650)
3,655
2,005		 2021
£000
7,425
25
(250)
(3,913)
‐
(4,138)
221
(513)
‐
(45)
(337)
2,950
705
3,655

The notes on pages 23 to 63 form part of these financial statements

Page 22

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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), 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 stiplulate 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 23

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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 grant is awarded.

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 with 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 £46k (2021:£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 24

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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, human resources and governance costs are allocated across categories of expenditure. The basis of the cost allocation has been explained in note 8 to the accounts.

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 25

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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 only enters into financial assets and financial liabilities which qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.

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:

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 26

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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:

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.

2.16 Programme related investments

NIAB holds programme related investments in five commercial companies which it is working with to further its charitable objects. These are carried at fair value when this can be measured reliably or, if it can't, at cost less impairment.

Page 27

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

2. Accounting policies (continued)

2.17 Debtors

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

2.18 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.

2.19 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 28

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

2. Accounting policies (continued)

2.20 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 29

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

2. Accounting policies (continued)

2.21 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 in the current year results.

The Group balance sheet shows a deficit of £588k (2021: £12,474k). Taking out the Restricted and Endowment funds leaves an Unrestricted deficit of £13,972k (2021: £13,472k). Stripping out the pension scheme deficit of £17,405k (2021: £19,225k) (discussed in more detail below), the long‐term debt to The Trust of £1,500k and Fixed Assets (Tangible plus Intangible) plus Trade investments in total within Unrestricted funds of £4,313k (2021: £8,338k) leaves an underlying unrestricted reserve of £620k (2021: negative £1,085k) as described in the Reserves policy in this report.

In the year, NIAB benefited from some one‐off grants and higher than anticipated revenues from commercial crop sales. Given the nature of this income, and with the changes in the current economy, particularly higher inflation, NIAB has undertaken an exercise of reviewing income and direct expenditure to identify areas of the organisation that are most sensitive to changes and under‐performing financially. The results have been used as a basis from which to formulate a model for strategic planning over the next 5 years. A key component of the revised 5 year plan is to create surpluses through improved margins on services and products.

The National Institute of Agricultural Botany Trust ('The Trust' ‐ Charity No. 1144528) was established with similar charitable objects to NIAB and fulfils its charitable objects through the provision of support to NIAB. A key component of the review of going concern, given other uncertainties, is the support from The Trust.

At the time of writing this report, the forecast for 2022/23 is for an operational deficit. NIAB will therefore be dependent on the support of The Trust to remain a going concern during 2022/23 and into 2023/24. Beyond this, NIAB expects to be in a sustained operational surplus position year‐on‐year.

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 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 payments agreed under the recovery plan. A new recovery plan, based on the triennial valuation at 31 March 2021 has been agreed with the Pension Scheme Trustees and submitted to The Pensions Regulator for approval.

Page 30

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

2. Accounting policies (continued)

2.21 Going concern (continued)

The Trust has a balance sheet value of in excess of £55m. 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:

  1. The cash flow forecast and latest management accounts, which give confidence that NIAB can continue to pay its debts as they fall due.

  2. The Trust's continued support to NIAB through the provision of facilities and funding and borrowing support.

  3. 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

2.22 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:

Page 31

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

3. Income from donations

Donations from National Institute of Agricultural Botany Trust
Donations from National Institute of Agricultural Botany Trust		 Unrestricted
funds
2022
£000
662		 Restricted
funds
2022
£000
500
Unrestricted
funds
2021
£000
500		 Total
funds
2022
£000
1,162
Total
funds
2021
£000
500

Page 32

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

4. Income from charitable activities

Agricultural services
Laboratory and research
Other activities
Total 2022 (including Government grants of £8.5m)
Agricultural services
Laboratory and research
Other activities
Total 2021 (including Government grants of £7.1m)		 Unrestricted
funds
2022
£000
11,014
4,813
14
15,841
Unrestricted
funds
2021
£000
7,704
6,900
137
14,741		 Restricted
funds
2022
£000
2,550
14,729
‐
17,279
Restricted
funds
2021
£000
2,346
5,659
‐
8,005		 Total
funds
2022
£000
13,564
19,542
14
33,120
Total
funds
2021
£000
10,050
12,559
137
22,746

Page 33

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

5. Income from subsidiary trading activities

Agricultural services
Agronomy consultancy
Agricultural services
Agronomy consultancy
Investment income
Rental income
Rental income		 Unrestricted
funds
2022
£000
6,232
1,273
7,505
Unrestricted
funds
2021
£000
6,498
1,331
7,829
Unrestricted
funds
2022
£000
56
Unrestricted
funds
2021
£000
62		 Total
funds
2022
£000
6,232
1,273
7,505
Total
funds
2021
£000
6,498
1,331
7,829
Total
funds
2022
£000
56
Total
funds
2021
£000
62

6. Investment income

Page 34

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

7. Analysis of expenditure on charitable activities

Summary by fund type

Agricultural services
Laboratory and research
Agricultural services
Laboratory and research		 Unrestricted
funds
2022
£000
10,175
3,225
13,400
Unrestricted
funds
2021
£000
7,616
5,637
13,253		 Restricted
funds
2022
£000
7,587
240
7,827
Restricted
funds
2021
£000
5,787
280
6,067		 Total
funds
2022
£000
17,762
3,465
21,227
Total
funds
2021
£000
13,403
5,917
19,320

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

Page 35

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

8. Analysis of expenditure by activities

Agricultural services
Laboratory and research
Agricultural services
Laboratory and research		 Activities
undertaken
directly
2022
£000
14,350
613
14,963
Activities
undertaken
directly
2021
£000
8,598
4,558
13,156		 Support costs
2022
£000
3,412
2,852
6,264
Support costs
2021
£000
4,805
1,359
6,164		 Total
funds
2022
£000
17,762
3,465
21,227
Total
funds
2021
£000
13,403
5,917
19,320

Analysis of support costs

Management
Finance
Information Technology
Human resources
Governance		 Agricultural
services
2022
£000
1,629
593
780
322
88
3,412		 Laboratory
and research
2022
£000
1,376
497
649
270
60
2,852		 Total
funds
2022
£000
3,005
1,090
1,429
592
148
6,264

Page 36

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

8. Analysis of expenditure by activities (continued)

Analysis of support costs (continued)

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

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

9. Auditors' remuneration

2022 2021
£000 £000
Fees payable to the Charity's auditor for the audit of the Charity's annual
accounts 30 27
Fees payable to the Charity's auditor in respect of:
The auditing of accounts of subsidiaries of the Charity 21 23
Additional fees in respect of audit previous year ‐ 38
Taxation compliance services 8 9

Page 37

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

10. Staff costs

Wages and salaries
Social security costs
Contribution to defined contribution pension
schemes
Operating costs of defined benefit pension
schemes		 Group
2022
£000
13,220
1,197
965
153
15,535		 Group
2021
£000
12,913
1,114
913
302
15,242		 Charity
2022
£000
11,622
1,055
855
129
13,661		 Charity
2021
£000
9,284
816
649
295
11,044

During the year a total of £35,289 (2021: £27,500) was paid to 2 employees (2021: 1 employee) as ex gratia payments. In addition £2,420 in total (2021: £61,582) was paid to 2 employees (2021: 7 employees) by way of redundancy payments.

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

Technical and Scientific
Support staff
Agricultural staff and casuals		 Group
2022
No.
219
54
93
366		 Group
2021
No.
210
59
92
361

Page 38

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

10. Staff costs (continued)

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

Group Group
2022 2021
No. No.
In the band £60,001 ‐ £70,000 10 9
In the band £70,001 ‐ £80,000 3 5
In the band £80,001 ‐ £90,000 3 1
In the band £90,001 ‐ £100,000 3 ‐
In the band £100,001 ‐ £110,000 ‐ 2
In the band £110,001 ‐ £120,000 2 ‐
In the band £120,001 ‐ £130,000 1 3
In the band £140,001 ‐ £150,000 ‐ 1
In the band £150,001 ‐ £160,000 1 ‐
The key management personnel during the year were:
Professor M Caccamo ‐ CEO (from 1 October 2021)
Dr T L Barsby ‐ CEO (until 30 September 2021)
S M Knight
Dr W Orme ‐ CFO (from 1 August 2021)
M Leaman
W Clark (retired 31 July 2021)
N Watson
Dr J McKee
R Harrison
X Xu

The total costs relating to key management personnel (including wages and salaries, employer’s national insurance, pension costs and fees) during the year were £1,010k (2021: £898k).

Page 39

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

11. Trustees' remuneration and expenses

The Chairman of the Board of Trustees and the Chairman of the Board’s Finance Committee received honoraria, totalling £9,600 (2021: £9,600 ; Deputy Chairman ‐ £2,700 ). Meeting fees totalling £5,000 were paid to six trustees (2021: £8,400 for eight 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 part of the year they were both employee and Chief Executive is as follows:

2022 2021
£000 £000
Dr T L Barsby OBE Remuneration 99 129
Pension contributions paid 6 10
Other benefits 7 13
Professor M J Caccamo Remuneration 77 ‐
Pension contributions paid 6 ‐

During the year ended 31 March 2022, expenses totalling £2,119 were reimbursed or paid directly to 3 Trustees (2021 ‐ £351 to 1 Trustee) .

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 17.

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 40

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

13. Intangible assets

Group

Cost
At 1 April 2021
Disposals
At 31 March 2022
Amortisation
At 1 April 2021
Charge for the year
On assets disposed of
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Plant Variety
Rights
£000
1,350
‐
1,350
370
93
‐
463
887
980		 IT Platfrom
£000
93
‐
93
93
‐
‐
93
‐
‐		 Purchased
Goodwill
£000
418
(100)
318
418
‐
(100)
318
‐
‐		 Total
£000
1,861
(100)
1,761
881
93
(100)
874
887
980

Goodwill of £100k in NIAB EMR but fully amortised has now been written off subsequent to the transfer of most of the business, assets and liabilities to NIAB on 1 April 2021.

Page 41

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

13. Intangible assets (continued)

Charity

Cost
At 1 April 2021
Transfer from NIAB EMR
At 31 March 2022
Amortisation
At 1 April 2021
Charge for the year
Transfer from NIAB EMR
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Plant Variety
Rights
£000
‐
1,350
1,350
‐
93
370
463
887
‐		 IT Platform
£000
93
‐
93
93
‐
‐
93
‐
‐		 Total
£000
93
1,350
1,443
93
93
370
556
887
‐

Plant Variety Rights and associated amortisation were acquired by NIAB when the business, assets and liabilities of NIAB EMR were merged into NIAB on 1 April 2021.

Page 42

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

14. Tangible fixed assets

Group

Cost or valuation
At 1 April 2021
Additions
Disposals
At 31 March 2022
Depreciation
At 1 April 2021
Charge for the year
On disposals
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Short‐term
leasehold
property
£000
606
893
‐
1,499
350
154
‐
504
995
256		 Plant,
machinery &
vehicles
£000
8,933
560
(381)
9,112
6,170
357
‐
6,527
2,585
2,763		 Office &
Computer
equipment
£000
3,003
157
(69)
3,091
2,354
385
(68)
2,671
420
649		 Scientific
equipment
£000
3,580
430
(43)
3,967
2,470
339
‐
2,809
1,158
1,110		 Assets under
construction
£000
2,687
8,070
‐
10,757
‐
‐
‐
‐
10,757
2,687		 Total
£000
18,809
10,110
(493)
28,426
11,344
1,235
(68)
12,511
15,915
7,465

Page 43

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

14. Tangible fixed assets (continued)

Charity

Cost or valuation
At 1 April 2021
Additions
Transfer from NIAB
EMR
Disposals
At 31 March 2022
Depreciation
At 1 April 2021
Charge for the year
Transfer from NIAB
EMR
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Short‐term
leasehold
property
£000
606
893
‐
‐
1,499
350
154
‐
504
995
256		 Plant,
machinery &
vehicles
£000
8,023
557
769
(381)
8,968
5,885
347
224
6,456
2,512
2,138		 Office &
Computer
equipment
£000
2,767
157
167
‐
3,091
2,153
382
136
2,671
420
614		 Scientific
equipment
£000
2,789
430
791
(43)
3,967
1,919
339
551
2,809
1,158
870		 Assets under
construction
£000
678
8,070
2,009
‐
10,757
‐
‐
‐
‐
10,757
678		 Total
£000
14,863
10,107
3,736
(424)
28,282
10,307
1,222
911
12,440
15,842
4,556

Fixed assets and associated depreciation were acquired by NIAB when the business, assets and liabilities of NIAB EMR were merged into NIAB on 1 April 2021.

The net book value of the group’s and charity's assets includes £302,748 (2021: £441,021) in respect of assets held under finance leases and hire purchase contracts. Depreciation charged in the year on those assets totalled £79,780 (2021: £142,905).

Page 44

NIAB

Notes to the Financial Statements
For the Year Ended 31 March 2022
15.
Fixed asset investments
Group and Charity
Cost or valuation
At 1 April 2021
Additions
Amounts written off
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Trade
investments
£000
141
14
(10)
145
145
141

Page 45

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

16. Principal subsidiaries

The following were subsidiary undertakings of the Charity:

Names Company Charity Principal activity 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 320 458 (138) (25)
TAG Consulting Limited 1,284 1,364 (80) (127)
NIAB Trading Ltd 4,968 4,517 451 462
NIAB EMR 666 689 (23) 1,623
East Malling Services Ltd. 5,542 5,104 438 907

The financial results of the subsidiaries for the year were:

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 46

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

17. Stocks

Raw materials and consumables
Finished goods and goods for resale		 Group
2022
£000
150
180
330		 Group
2021
£000
98
200
298		 Charity
2022
£000
150
105
255		 Charity
2021
£000
98
115
213

18. Debtors

Due within one year
Trade debtors
Amounts owed by group undertakings
Other debtors
Prepayments
Accrued income		 Group
2022
£000
3,990
‐
461
860
5,263
10,574		 Group
2021
£000
4,040
‐
126
572
3,327
8,065		 Charity
2022
£000
2,277
1,721
458
838
2,300
7,594		 Charity
2021
£000
2,367
2,779
125
441
1,425
7,137

Page 47

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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 2021
Resources deferred during the year
Amounts released from previous periods		 Group
2022
£000
148
2,085
‐
374
195
1,431
7,089
11,322
Group
2022
£000
4,225
3,582
(4,225)
3,582		 Group
2021
£000
1
2,103
‐
813
214
2,634
6,326
12,091
Group
2021
£000
3,824
4,225
(3,824)
4,225		 Charity
2022
£000
148
2,000
2,570
283
195
918
4,338
10,452
Charity
2022
£000
3,347
2,902
(3,347)
2,902		 Charity
2021
£000
1
1,803
687
741
214
1,282
4,557
9,285
Charity
2021
£000
2,916
3,347
(2,916)
3,347

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 48

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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
2022
£000
1,500
151
66		 Group
2021
£000
1,500
213
49		 Charity
2022
£000
1,500
151
24		 Charity
2021
£000
‐
213
23
1,717 1,762 1,675 236
Group
2022
£000
195
151
346		 Group
2021
£000
214
213
427		 Company
2022
£000
195
151
346		 Company
2021
£000
214
213
427

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.

21. Financial instruments

Group Group Charity Charity
2022 2021 2022 2021
£000 £000 £000 £000
Financial assets
Financial assets measured at fair value through
income and expenditure 2,005 3,655 1,419 1,674

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

Page 49

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

22. Statement of funds

Statement of funds ‐ current year

Unrestricted
funds
General funds
Pension fund
Endowment
funds
John Oldacre
Foundation
Restricted
operating funds
Other revenue
grants
Restricted grant
income
Restricted
property funds
Restricted Capital
Grant Funds
Total Restricted
funds
Total of funds		 Balance at 1
April 2021
£000
5,753
(19,225)
(13,472)
750
‐
‐		 Income
£000
24,064
‐
24,064
‐
500
7,217		 Expenditure
£000
(23,739)
‐		 Transfers
in/(out)
£000
(2,434)
‐		 Gains/
(Losses)
£000
(10)
1,619
1,609
‐
‐
‐
‐
‐
‐
1,609		 Balance at 31
March 2022
£000
3,634
(17,606)
(13,972)
750
‐
‐
‐
12,634
12,634
(588)
(23,739) (2,434)
‐
(500)
(7,217)
(7,717)
(110)
(7,827)		 ‐
‐
‐
‐
2,434
2,434
‐ 7,717
248
248
(12,474)		 10,062
17,779
41,843
(31,566) ‐

The transfer relates to Capital grant monies received in the previous year and treated as unrestricted. These have now been reallocated and disclosed as Restricted Capital Grant Funds.

Page 50

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

22. Statement of funds (continued)

Statement of funds ‐ prior year

Unrestricted
funds
General funds
Pension fund
Endowment
funds
John Oldacre
Foundation
Restricted
operating funds
Restricted grant
income
Other Funds
Restricted
property funds
Hasse Fen capital
fund
Total Restricted
funds
Total of funds		 Balance at
1 April 2020
£000
2,163
(13,987)
(11,824)
750
‐
‐
‐
308
308
(10,766)		 Income
£000
23,132
‐
23,132
‐
6,007
1,998
8,005
‐
8,005
31,137		 Expenditure
£000
(21,540)
111
(21,429)
‐
(6,007)
‐
(6,007)
(60)
(6,067)		 Transfers
in/(out)
£000
1,998
‐
1,998
‐
‐
(1,998)
(1,998)
‐
(1,998)		 Gains/
(Losses)
£000
‐
(5,349)
(5,349)
‐
‐
‐
‐
‐
‐
(5,349)		 Balance at
31 March
2021
£000
5,753
(19,225)
(13,472)
750
‐
‐
‐
248
248
(12,474)
(27,496) ‐

Page 51

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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.

23. Analysis of net assets between funds

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
2022
£000
3,281
887
145
12,159
(11,322)
(1,717)
(17,405)
(13,972)		 Restricted
capital grant
funds
2022
£000
12,634
‐
‐
‐
‐
‐
‐
12,634		 Endowment
funds
2022
£000
‐
‐
‐
750
‐
‐
‐
750		 Total
funds
2022
£000
15,915
887
145
12,909
(11,322)
(1,717)
(17,405)
(588)

Page 52

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

23. Analysis of net assets between funds (continued)

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
2021
£000
7,217
980
141
11,268
(12,091)
(1,762)
(19,225)		 Restricted
funds
2021
£000
248
‐
‐
‐
‐
‐
‐
248		 Restricted
capital grant
funds
2021
£000
‐
‐
‐
‐
‐
‐
‐
‐		 Endowment
funds
2021
£000
‐
‐
‐
750
‐
‐
‐
750		 Total
funds
2021
£000
7,465
980
141
12,018
(12,091)
(1,762)
(19,225)
(12,474)
(13,472)

Page 53

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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
Investments written off
Profit on the sale of fixed assets
Decrease/(increase) in stocks
Increase in debtors
Increase/(decrease) in creditors
Interest payable
Pension scheme charges
Net cash provided by operating activities
25.
Analysis of cash and cash equivalents
Cash in hand
Total cash and cash equivalents		 Group
2022
£000
10,267
1,235
93
10
(6)
(32)
(2,509)
(733)
33
(201)
8,157
Group
2022
£000
2,005
2,005		 Group
2021
£000
3,641
1,434
88
‐
(18)
10
(811)
3,147
45
(111)
7,425
Group
2021
£000
3,655
3,655

Page 54

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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
2021
£000
3,655
(1)
(1,500)
(427)
1,727		 Cash flows
£000
(1,650)
(147)
‐
227
(1,570)		 New finance
leases
At 31 March
2022
£000
£000
‐
2,005
‐
(148)
‐
(1,500)
(146)
(346)
(146)
11

Page 55

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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 2018. The valuation has been updated to 31 March 2022 by a qualified independent actuary.

NIAB expects to contribute £1,000,000 to its defined benefit pension scheme in 2022/23 (2021/22: £700,000).

The amounts recognised in the balance sheet are as follows:

Present value of funded obligations
Fair value of plan assets
Deficit		 2022
£000
(48,403)
30,998
(17,405)		 2021
£000
(50,033)
30,808
(19,225)

Included in the deficit is £Nil (2021‐ £Nil) which is a provision for Guaranteed Minimum Pension equalisation.

The Pension Fund Trustees and the charity agreed as part of the 31 March 2018 valuation that, from 1 April 2020 onwards, pensions in payment will 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		 2022
£000
130
378
‐
508		 2021
£000
303
303
‐
606

Page 56

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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 gain/(loss) on defined
benefit obligation
of which due to experience
of which due to demographic
assumptions
of which due to financial
assumptions
Total gain/(loss) in other movements
in funds		 2022
£000
(546)
22
1,696		 2022
£000
447
1,172
1,619		 2021
£000
575
63
(7,388)
‐		 2021
£000
1,401
(6,750)
(5,349)

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

Liabilities at the start of the period
Interest cost
Actuarial gain
Benefits paid
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		 2022
£000
50,033
986
(1,172)
(1,444)
48,403
2022
£000
30,808
608
447
709
(1,444)
(130)
30,998
2022
£000
608
447
1,055		 2021
£000
43,939
949
6,750
(1,605)
50,033
2021
£000
29,952
646
1,401
717
(1,605)
(303)
30,808
2021
£000
646
1,401
2,047

Page 57

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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		 2022
£000
7,108
11,189
7,039
5,661
30,998		 2022
%
22.9
36.1
22.7
18.3
100.0		 2021
£000
6,553
10,832
7,723
5,700
30,808		 2021
%
21.3
35.1
25.1
18.5
100.0

Principal actuarial assumptions at the balance sheet date:

2022 2021
Discount rate 2.8% 2.0%
Rate of increase in salaries 3.4% 2.7%
Rate of increase in pensions 3.3% 2.7%
Rate of inflation RPI 4.0% 3.3%
Rate of inflation CPI 3.4% 2.7%
Life expectancies:
Current pensioners age 65 ‐ males 21.8 21.8
Currnet pensioners age 65 ‐ females 24.2 24.1
Future pensioners age 65 (currently age 45) ‐ males 22.8 22.8
Future pensioners age 65 (currently age 45) ‐ females 25.3 25.3

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 gain
% of scheme assets
Liability gain/(loss)
% of scheme assets		 2022
£000
(48,403)
30,998
(17,405)
447
1.4%
1,172
2.4%		 2021
£000
(50,033)
30,808
(19,225)
1,401
4.5%
(6,750)
‐13.5%

Page 58

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

27. Pension commitments: Defined Benefit schemes (continued)

(B) Universities Superannuation Scheme

Liability less than 1 year
Liability more than 1 year
Total		 2022
£'000
3
42
45		 2021
£'000
3
26
29

Since the The Arable Group Limited 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 2020 to meet the requirements of the Pensions Act 2004 and was published in March 2022. This actuarial valuation shows a shortfall of £14.1bn in the USS with the scheme assets being sufficient to cover 83% of its ‘technical provisions’ liabilities.

Based on this valuation the actuary has determined that the Employers deficit contributions will be 6.2% of salary until 31 March 2024 and 6.3% thereafter.

The past service deficit contributions are expected to correct the deficit by 30 April 2038. To reflect the liability for these contributions the charity 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 2022 are shown below.

Further details on, and a copy of, the 2020 Actuarial Valuation of the USS can be found on the USS website.

Page 59

NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

27. Pension commitments: Defined Benefit schemes (continued)

Further information on the 2020 actuarial valuation of the USS Scheme is included below.

Of The Arable Group Limited's 4 employees at 31 March 2022 (2021:4), 2 were members of USS (2021:1).

The Arable Group Limited’s calculated share of the USS defined benefit pension liability amounts to £45k (2021: £29k) and the total cost charged to the Statement of Financial Activities in respect of USS amounts to £15k (2021: £8k).

The liability has been re‐calculated using the USS model provided with reference to the remaining deficit recovery period of 18 years from 2020 to 2038. 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:

2022 2021
Discount rate 2.22% 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		 2022
£'000
8
‐
7
15
1
16		 2021
£'000
17
(1)
(9)
7
1
8

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

2022 2021
Discount rate 2.22% 2.3%
Pensionable salary growth n/a n/a
Pension increases (CPI) 2.7% 2.7%

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NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

27. Pension commitments: Defined Benefit schemes (continued)

The main demographic assumption used relates to the mortality assumptions. These assumptions are based on analysis of the Scheme’s experience carried out as part of the 2020 actuarial valuation. The mortality assumptions are based on the following mortality tables:

2020 2018
Male members mortality 101% of S2PMA 71% of AMC00
light (duration 0)
Female members mortality 95% of S3PFA 112% of AMFG00
(duration 0)

Future improvements to mortality are based on the Continuous Mortality Investigation’s (CMI) 2019 projections with smoothing parameter of 7.5, an initial addition of 0.5% 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:

2022 2021
Males currently aged 65 years 23.9 24.4
Females currently aged 65 years 25.5 26.3
Males currently aged 45 years 25.9 25.9
Females currently aged 45 years 27.3 27.7

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

2022 2021 2020
Scheme assets £124.4bn £80.6bn £66.5bn
Total scheme liabilities £77.1bn £95.8bn £79.4bn
FRS102 Total scheme deficit £47.3bn £15.2bn £12.9bn
FRS102 Total funding level 83% 84% 84%

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NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

28. Operating lease commitments

At 31 March 2022 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
2022
£000
729
1,275
2,004		 Group
2021
£000
745
1,616
2,361		 Charity
2022
£000
728
1,275
2,003		 Charity
2021
£000
734
1,616
2,350

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

Land and Buildings
Motor vehicles		 Group
2022
£000
665
155
820		 Group
2021
£000
728
180
908		 Charity
2022
£000
665
155
820		 Charity
2021
£000
267
135
402

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 or settled until May 2021, the additions have been be reflected in the accounts for the year to 31 March 2022.

The charity have commited to spend £435k on a Microscopy Suite which is due for completion in November 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.

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NIAB

Notes to the Financial Statements For the Year Ended 31 March 2022

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:

2022 2021
£000 £000
Closing (creditor) (148) (1)
Annual support 1,125 1,125
Additional support towards pension costs 500 500
Contribution towards other costs 600 ‐
Expenditure (500) (500)

In 2017 NIAB EMR, a subsidiary company, obtained a loan of £1,500,000 from National Institute of Agricultural Botany Trust. The loan was transferred to NIAB on 1 April 2021 when the business, assets and liabilities of NIAB EMR were merged into NIAB. This loan is secured by a first fixed and floating charge on the assets of NIAB EMR and, while there is 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. 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 surplus of £9,815k (2021: surplus £1,270k).

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