Rrflstered number: 05225211 (England and Wales) Charlty Number: 1106618 STC Research Foundation (Company Limlted by Guarantee) Trustees, Report and Financlal Statements for the year ended 31 December 2023
STC Research Foundation Contents Page Charity Information................. Trustees. Report........................... Independent Auditorfs Report............ Consolidated Statement of Financial Artlvities........................................................... 10 Consolidated Balan Sheet............ .11 Charity Balance Sheet................... .12 Consolidated Statement of Cash Flows........................................ .13 Notes to the Finanoal Statements.............................................. . .14
STC Research Foundatlon Charlty Znlomiatlon Truste N D Bartle P R Branfield A S Burge55 M M Evans Dr D Georye J ThompsLin (resigned 4 September 2023} Company reglst¢r¢d number 05225211 (England and Wales) Charlty reglst•rnd number 1106618 Reglstemd offic• Stockbridge House Cawood Selby Y08 3TZ Company Secr•t*ry J K Langdale Audltor Azets Audlt Servlces Limited Triune Court Monks Cross Drive York Y032 9GZ Bankem Virgin Money 46 Coney Street York YOI 9NQ Soll¢ltors Swinebume Maddlson LLP Venture House Aykley Heads Buslness Centre Durham OHI 5rs
STC Research Foundation Trustees. Report for the year ended 31 December 2023 The Trustees present their annual report together with the audlted finanoal statements of STC Research Foundation for the year ended 31 December 2023. The annual report serves the purposes of both a Trustees, pOrt and a directors. report under company law. The Trustees confim that the Annual report and financ1 ststements of the charitable group comply with the current statutory requirements, the requirements of the charity's governing document and the provisions of the statement of Recommendation Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable to LIK and the Republic of Ireland (FRS 102) (effective l January 2019). Reference and •dministratlve details The charity information on page I fornis part of this Trustees, report. Objertlves and Activities The company is a Charity and exists to promote agrarian practices through promotion of researth, provision of lectures and publishing related infomiation. The company took over, on l December 2004, the operations that were previously carried out by the UK Trust for Advantement of Agrarian Practices. We carry out trials to test efficiency of agronomic practices and report these to our funder5. The outcomes of publidy funded projects are reported to them and together we communicate the results to growers for them to use in their business. Similarly. with privately funded trials but these are more regularly demonstrated to farmers and growers Invited to the site to discuss the technology in situ. Another objertive of our work is to transfer technical I scientific knowledge, often arising in Universities using Research Counctl funds, to famiers and growers to improve the efficiency and environmental performance of their business. The satisfaction of these farmers and growers determine the continuation Jnd funding of future projects and sustainability of our Charitable aims. Our work is assessed by our fvnders on an ongoing basis. With public funds, this rs via an ongoing and final written report delivery against the critenon set. Our private ftjnders measure success by the quality of presentations we make at demonstrations directly to their customers (farniers and growers). Our field trial demonstration plots cover many arable crops. We carry out specific agrion on smaller but more detailed trials on field vegetables. sugar beet and a range of soft ftwit. Under protertion (glasshouses and dosed LED facility) we grow tomatoes, peppers, cuoJmbers and a range of herbs and flowers. This wide range of crops allows a broad educational and technology transfer audience to achieve cHJr objectives across a multi cropping industry. Public beneflt The Charfity's aims and achievements are set out wrthin this port. The acti¥th"es set out in the Trustees. report have been undertaken to fvrther the Charity's charitable purpose for the public benefit. The Trustees have complied with the duty under Section 4 of the Charities Act 2011 to have due regard to public benefit guidance published by the Charity Commission and the Trustees have paid due regard to this guidance in deciding what activib.es the Charity should undertake.
STC Research Foundation Trustees. Report for the year ended 31 December 2023 (continued) Achlevem•nts and perforniance This periTrJ saw continued ener9y and general input cost inflation. This has had a major effect on all actlvlties at Stockbridge, but the oryanisation has coped and income maintained. School visits and activities in the outdoor dassroom were on hold during 2022. but we were able to successftjlly restsrt them on a limited basis in 2023. The site contfjnues to be busy. out on the fami broad acre trials of new varieties have continued along with Investigation to test and trial tomorrow's crop protection products. Our work together with CHAP continues to increase. We have a CHAP employee based at the STC site and current projects use the -vertical Fami" and "Advanced Glasshouse" facility with other projects in STC glasshouses. In the gla55 work has ranged from seed produrtion, through to investigating pham)aceutical use as before. The range of crop5 and environments grown has been diverse. Trials on growing media have Increased as companies strive to develop peat free growing media to meet government target of zero peat products. The team has commLtnlcated effectively with dfients negotiating cost increases in line with inflated input costs. This has enabled the continued growing of crops / trials to the sr¢e's capacity. Goln9 concern After making appropriate enquiries, the Trustees have a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future. For this reason. they continue to adopt the going concern basis in preparing the financial statements. Further details regarding the adoption of the going concern basis can be found in the accounting policies. R•wrve$ pollcy The group currentiy has unrestrided resetves of £3.725,189 (2022 - £3.367.268). However, a substantial proportion of these resee$ are td up in fixed assets. which means that the free reserves available for unrestricted use is £589.869. This equates to approximately 182 day5 operating cost5. The Trustees consider 100 days or £500,000 in reserve to be sufficient and extes5 to this will be used to pay down long term loans. This policy should provide the group with the ability to undertake unlunded research proj.ects and meet any timing delays arising through either current or future funding streams. It is the poliLry of the charitable group to maintain malnly unrestricted fijnds at a level sufficient to promote and maintain the obJective5. Our reserye pollcy (and borrowing) is based around cMJr land owrber5hip which we have no reason to believe will fall below £3m. Our cash reserves are basically to cover short temi cash flow and possible projert failures. They cover approximately 41% of our annual tumover. Prlnclpal rlsks and un¢ertalnti Our stability is based arounLI our land value where our borrowings are limited to 40% exposure. Our funrtional risk is whether farrners and growers still requi demonstration and / or field assessment of agronomic risks. We have explained that our private funders {suppliers of goods to farmers in the main) are continually placing forward work. Our public funders are. we regret. in continual disarray both with UK policy* and by exit from the EU. We are carrying out considerable adaptions to our business model to oftset this risk to less than 20% of our wotk from these public funded contsms.
STC Research Foundation Trustees. Report for the year ended 31 December 2023 (continued) Flnandal rlsk management obiectlves and polldes The Trustees have assessed the major risks to which the Charity and the Group is exposed, in particular those related to the operations and finances of the Charity and the Group. and are satisfied that systems and procedures are In pla to mitigate our exposure to the maj.or risks. Finandal revlew During the period consolidated income amounted to £2,431,691 (2022 £2,223.008) and consolidated expenditure was E2.069.787 (2022 - £1,950.386). The group held fund balances as at 31 December 2023 of £3.725.189 (2022 E3,367.268) compromising of £nil (2022 £nil) of restricted funds and £3.725.189 (£2022 - £3,367.2681 of unrestn.tted funds. Unrestrfjcted funds Includes an unrealised revaluation gain of £1.424.cN)5 (2022 - £1.424.349). Organls•tional Structure STC Research FoLFndation is reglstered as a charitable company limited by guarantee and was set up by a Memorandum of Association on 8 September 2004 and registered as a charity on 5 November 2004. Fundraising Nelther the Charity nor the Group actively fvndraise from the public, no commercial fundraisers are engaged. Fundralslng In the charity sector has been regulated by the fundraising Regulator since 2015 but the Charity 15 not specifically re9iStered. The Board Is not aware of any failure by the Charity to comply with this regulation and no complaints have been received In relatr.on to any form of fundraising. Method$ of appolntment or electlon of Trustees The management of the Chanty and the Group is the responsibility of the Trustees who are elected and co-opted under the terms of the Artides of Association. Under those articles, the minimum number of trustees is 3. At each AGM one third of the trustees must retire by rotation. They are eligible for re-appointment. The STC Research Foundation Board of Trustees is made up of experienced persons within the agNcultural/horticultural business. from academia to practical farmerslgrowers. They oversee that the directors of Stockbridge Technology Centre Limited {STC Ltd). our delivery facility, carry out work to Satisfy the aims and objertives of the charity. Strategic short and long-temi policies are set at the AGM of STC Research Foundation. The financial and ftjnctional operations are controlled by src Ltd board who meet frequently (at least every two months). Day to day contart with all STC Ltd dirertors and the staff are maintained via the Administrative Manager. Trustees a invited to join the Board of Trustees after assessing what expertise is required to Stngthen the charity's activith'es and responsibilities. Policies adopted for the Indurtion and training of Trustees The training and induction provided for new Trustees depends on thelr existing experien. Where necessary* induction and training is provided on charity. legal and financral matters. All Trustees are provided with copies of policies. procedures. minutes. accounts. budgets. plans and other doojments that they will need to undertake their role as Trustees. As there might only be one or two new Trustees in any year. Inductlon tends to be done infornially and is tall0d specifically to the individual.
STC Research Foundation Trustees. Report for the year ended 31 December 2023 (continued) Pay pollcy for key management personnel We have a staff salary scale based around job descriptions which in tum takes into consideration qualifications both academic and experience. This scale and staff positions within it are reviewed by the STC Ltd directors at least On per year normally in the Spring. We base our scale levels on other similar èchievements. Universities and personal knowledge. We a a "living wage" employer. Relat•d paity relatlonshlps The trading subsidiary. Stockbrfdge Technology Centre Limited was incorpornted in 2001. The company develops and transfers plant technology to growers and famiers to enable them to maximise their yields of quality crops. The Charity is managed by the Tru5tee5 of STC Research who meet as appropriate in the year to set the strategy for the group. Day to day mafta9ement is undertaken by the company secretary. Flnanaal risk management The Trustees have assessed the major risks to which the Grtyjp and the Charity are exposed, in particular those related to the operations and finances of the Group and the Charity. and are satisfied that systems and procedu a in place to mitigate exposure to the major risks. Plans for future periods STC are pleased to have been able to restart educational visits to the Site and will strive to enable schools to continue to do so. STC Research Foundation has a srnall tight group ofTrustees who coverthe key areas of engagement with the HortioJlturallAgricultural industry. The Trustees focus on building and delivering a strategy suitable for the future. This plan will look at how the growing environment chan9es to focus on the impacts of climate change. a growing population and how crops integrate with this. This will evolve and be ported on over future years. Audltors The auditor, Azets Audit Seniice5 ts"mited, 15 deemed to be reapwinted under section 487(21 of the Companie5 Act 2006. Sm•ll companies •xemptlon This report has been prepared in accordance with the provisions applicable to companies entotled to the small companies exemption.
STC Research Foundation Trustees. Report for the year ended 3 1 December 2023 {continued) Statement of Trnstees. responslbllltles The Trustees (who are also the director5 of the charitable company for the purposes of company lèw) are responsible for preparing the Trustees. report and the financial statements in accordance with applicable lav4 and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Charity law require5 the Trustees to ppare finanaal statements for each finanoal year which give a true and fair view of the state of affairs of the charity as at the end of the financial year and of the surplus or deficit of the charity for that period. In preparing those finaftcial statements the Trustees are reqUId to: select suitable accounb.ng policies and then apply them consistently: ObSee the methods and prinaples of the Charities SORP {FRS 1021; make judgments and accounting estimates that a aSOnable and prudent; state whether applicable UK Accounting Standards (FRS 102) have been followed. subjett to any material departures disclosed and explained in the financial statements; prepare the financial statements on the going conr basis unless it is inappropriate to presume that the Group will tontinue In business. The Trustees are responsible for keeping adequate accounting records that a sufficient to show and explain the Group and the Charity's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Charity and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and the Charity and hence for taking reasonable steps for the prevention and detertion of fraud and other irregularities. Dlsclosure of informatlon to audFtors The Trustees of the charitable company who held offKe at the date of approval of this annual report confirm that- so far as that Trustee is aware, there is no relevant audit infornlation of which the charitable group's auditors a unaware, and that Trustee has taken all the steps that ought to have been taken as a Trustee In order to be aware of any relevant audit infomiation and to establish that the charitable group's auditors are aware of that infomiation. Approved by ord behalf by.. e members ofthe board of Trustees on ..... ... and signed on their er Truste ran
STC Research Foundation Consolidated Statement of Flnanclal Actlvities (including Income and Expenditure Account) for the year ended 31 December 2023 Unrestrlrted Total Funds 2023 Unrestrlrted Total Funds 2022 Notes Income trom: Charitable activities 238,403 2,023,991 I raoing acitvities Investments 1,876,843 316.445 140.787 2.223,008 Total inc•me 2,431,691 xpendlture on: Charitable activities 223,299 1.846,488 1.950.386 Trading attivities Total expendlture 2.069.787 1,950,386 Net income before taxation 361.904 272.622 55.016 Taxation 12 (3.983) 357,921 3.367.268 3.725.189 Net movement in funds 327,638 Total funds brought forward Total funds carried forward 3,039,630 3.367,268 The Consolidated Statement of Financial Activities includes all gains and losses recognised in the year. All income and expenditure derive from continuing activities. The Statement of Financial Activities complies with the requirements for an income and expenditure account under the Companies Act 2006 and indudes all gains and losses reco9nised in the year. The notes orb pages 14 to 32 form part of these financial statements. io
STC Research Foundation Consolidated Balance Sheet as at 31 December 2023 2023 2022 Notes Flxed assets Tangible asset5 Investments 13 3.120.062 15.258 3.135.320 3,105.483 14 11,570 3. 117.053 Current assets 15 61.3G4 529.708 Debtors 16 687.550 750,304 1,523,704 Cash at bank and in hand 26 1.089.758 1.680.830 Credltors: Amounts falling due within one ear Net current assets 17 (586.064) (552.8161 1.094.766 970,888 Total assets less ¢urrent Ilabilities Creditors: amounts falling due after more than one year Provisions for liabilities 4.230.086 4.087.941 18 (231,097) (454.573) 22 1273,800) (266, 100) 3,367,268 Total net a55ets 3.725.189 Charlty funds Unrestrirted funds." General funds 2,297,584 1.424.005 1,942.919 Revaluation reserve 1,424,349 Total unrestrirted funds 23 3.725.189 3,367,268 Total funds 23 3.725,189 3,367.268 The Trustees acknowledge their respongbilities for complying with the requ1MentS of the Companies Art 2006 with respect to accounting records and ore ration of financial statements. fin atem 1¢17r nts were approved by the board on . and signed on its behalf by: et Trustee The notes on pages 14 to 32 form part of these finanoal statements. Company re9iStratlon number: 05225211 li
STC Research Foundation Charity Balance Sheet as at 31 December 2023 2023 2022 Not Flxed Investments 14 Cutrnnt as•ets Debtors 16 1,706 23,296 133 097 Gish at bank ond in hand Credltovs: Arnnts falllng due within one ear 170,009 156,393 17 Net current assets 161 702 150 581 Total aM•ts lem current Il•blllths 161 707 150 586 Charlty fund: Unrnstrlcted funds 161 707 150 586 The Trustees acknowledge their responslbilities for complying with the requirements of the Companies Art 2006 with respect to accounting records and p ation financial statements. The financial stateme by.. approved by the board on ...... .. . ............ . and slgned on its behalf ter Brnnf Trust The notes on pages 14 to 32 form part of these financial statements. Company re9lstrtlon number: 0522S211 12
STC Research Foundation Consolidated Statement of Cash Flows for the year ended 31 December 2023 2023 2022 Notes Cash flows from operntlng ac1iviTttes Cash from operations Taxation refunded 25 306.934 578.663 Net cash rovided ratl actlvlties 365 760 578 663 Cash flows from Investsng acllvltles Investment income 316.445 140,787 16,350 (3,461) (73,225> Proceeds from the sale of tangible fixed assets Increase in valuation of investments Purchase of tangible fixed a55ets Interest aid (3,688) (108.824) Net cash rovided b investln activltles 175 187 Cash flows fmm flnandng artlvltles Repayment of borrowings Drawdown of loans { 197.443) 1693,889) 605,303 Hire urchase ments in the ear Net cash used in finanan actlvltles 201 493 Change In cash and cash equivalents In the year Cash and cash uivalents at the innin of the ear 339,454 S27.140 Cash and cash uival¢nts at the end of the 26 1 089 758 13
STC Research Foundation Notes to the Con501tdated Financial Statements for the year ended 31 December 2023 General Inforniation The Charity is a company limited by guarantee. The members of the company are the Trustees as named on page l. In the event of the charity being wound UP* the liability of the guarantee is limited to £10 per member of the Charity. Aecountlng polldes Basls of preparatlon of finanaal ststements The financial statements have been pPared in accordance with the Charities SORP {FRS 102) - Accounting and Reporting by Chanties: Statement of Recommended Practice applicable to charlties preparlng their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective l January 2019). the Financial Reporting Standard applicable in the UK and Ireland (FRS 102) and the Companies Att 2006. The financial statements are ppared in sterling, vthich is the funrtlonal currenry of the charitable company. Monetary amounts in these finanoal statements are rounded to the nearest £1. STC Research Foundation meets the definition of a public benefft entity under FRS 102. Assets and liabilities a initially recognised at cost or transattion value unless otherwise stated in the relevant accounting policy notes. The consolidated statement of financial artivities (SOFA) and consolidated balance sheet consolidate the financial statements of the parent charItaLe company and its subsidiary undertaking. The results of the subsidiary are consolidated on a line by line basis. On the grounds that the charitable company's results are consolidated into the charitable company's group accounts the charitable company has taken advantage of rtain exemptions tonferred by section 1.11 of FR5 102 as follows". Exemption from presenting a charitable company statement of cash flows as a primary statement to the financial statements. As perniitted by s408 Companies Act 2006. The charitable company has not presented its own profit and loss account and related notes. The charitable cornpany's profit for the year was Él 1.121 {2022 £44,6961. Golng concern The trustees are constantly monitoring the financial position of the charitable 9roup and recognise the relian the charity has on the profitability of the trading activities of its subsidiary. especially in the post pandemlc environment and the uncertainties that continues to bring. As disclosed In note 18 to these financial statements, the groupi via its subsidiary. does benefit from the sUPPOrt of its bank in the fonn of two seojred loan facilities. Both of these loan5 were renewed during 2022 for a period offive years. At the time of approving the financial statements. the trustees believe that it is appropriate to continue to adopt the going concern basis of accountr.ng in p paring the financial statements . Income All income is recognised once the charity has entitlement to the ftjnds. it is probable that the income will be reiVed and the amount of income receivable can be measured reliably. Income tsx recoverable in relation to Investment income is reco9nised at the time the investment Income is receivable. Rents receivable are accounted for on an accruals basi5. Investment income, gains and losses a allocated to the appropriate fund. 14
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) Expenditure Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefits to a third party. It is probable that a transfer of economic benefrts will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is dassified by activity. The costs of each artivity are made up of the total of direct costs and shared costs. including support costs involved in undertaking each artivity. Direct costs attn"bvtable to a single attivity are allocated directly to that activity. Shared costs whith Contrite to more than one artivity and support costs which are not attributable to a single artivity are apportioned between those attivities on a basis consistent with the use of resour5. Central staff costs are allocated on the basls of time spent. and depreciation charges allocated orb the portion of the asset's use. Expendltijre on charitable activities is incurred on directly undertaking the activities whlch further the Group's objectives. as well as any associated support Costs. Trading costs represent costs incurred by the trading sudIary. recognised on transfer of economit risk and reward. All expenditure is indusive of irrecoverable VAT. Tanglble flxed assets and depreclatlon Tangible fixed assets cosb.ng more than £2.000 are initially recognised at cost. After COgnIOn. under the cost model, tangible fixed assets are measured at cost less accumulated degreciation and any accumulated impairment losses. All costs incurred to bring a tangible fixed asset into its intended working condition are included in the measurement of cost. Depreciation is charged so as to allocate the cost of tangible fixed assets les5 their residual value over their estimated useful lives. Depreciation is provided on the fdlowing bases.. Freehold property Plant and machinery Motor vehicles Fixtures and fittings Computer equipment straight line 250/0 reducing balance 25% reducing balance 25% reducing balon 25% reduong balance Depreciation is not provided on freehold land. The Charity has adopted the revaluation model to revalue foehold land and property whose fair value can be reliably measured. The revaluations shall be made with sufficient regularity to ensure that the carrying amount does not differ Materially from that which would be deterniined using fair value at the end of the reporting period. The fair value of land and buildings is usually determined from market based evidence by appraisal that is nornially undertaken by professional qualified valuers. Revaluation gains and losses are recognised in other cornprehensive income and accumulated in funds. 15
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 3 1 December 2023 {continued) 2.6 Investments Fixed asset investments are a form of financial instrument and are initially recognised at their transath'on cost and subsequently MeaSud at fair valve at the balance sheet date, unless the value cannot be measured reliably in which case it Is measured at cost less impaimient. Investment gains and losses. whether realised or unrealised. are combrned and presented as 'Gains1(Losses) on investments. in the Consolidated ststement of financial attivities. Investment in subsidiaries are valued at cost less provision for impairnient. stod(s Stocks are ststed at the lower of c05t and estimated selling price less costs to complete and sell. Cost indudes all direct costs and an appn)priate prop)rtion of fixed and variable overheads. Debtors Trade and other debtors are recognised at the settlement amount after any trade discount offered. Prepayments are valued at the amount prepaid. Cash at bank and In hand Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisf(i¢)n or opening of the deposit or similar account. 2.10 Liabilltles Liabilrties and provisions are recognised where there is an obligation at the balance sheet date as a result of a past event. it is probable that a transfer of eCormi( benefit will be required In settlement. and the amount of the settlement can be estimated reliably. Liabilities are recognised at the amount that the Charity ants"opates it will pay to settle the debt or the amount it has received as advanced payments of the goods or Servi it must provide. Provisions are measured at the best estlmate of the amounts requi to settle the obligation. Where the effert of the time value of money is material. the provision is based on the present value of those amounts. discounted at the pre-tax discount rate that fleCtS the risk specific to the liability. The unwinding of the discount is recognised in the consolidated statement of financial attivities as a finance tost. 2.11 T•xatlon STC Research Foundation is a registered charity and as such is a charity within the rneaning of schedule 6 of the Finance Act 2010. Accordinglyi It IS Potentially entitled to tax exemption under part I l of the Corporation Tax Att 2010 or section 256 of the Taxation of Chargeable Gains Act 1992 in re5pett of income and gains arising. The tax expense represents the sum of tax currently payable and deferred tax in the subsidiary undertaking. whlch, as a trading entity, is not afforded such tsx exemptions. Currnnt tax The tax currently payable Is based on taxable profit for the year. Taxable profit differs from net profit as reported in the statement of financial attivities because it exdudes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or dedurtible. The company's liability for current tax is calculated Ung tax rates that have been enatted or substsntivety enacted by the reporting end date. Where the calculation of current tax indudes significant uncertainties. the trustees apply a FQint estimate in the calculation of the tax charge and associated asset or liability. This is calculated based on agreement with tax authorities over accepted estimates and adjustments to the Company's taxable profits. with the trustees considering it probable that a similar outcome will be obtsined in the current year by adopting the same ests"mation methodology. and accordingly have provided for the a55¢xiated tax relief on the grounds that it is probable this will be retsived. 16
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) 2.11 Taxation (continued) Delened tsx Deferred tax liabilities are generally recognised for all tlrnln9 differences and deferred tax assets a recognised to the extent that it is probable that they will be recovered against the reversal of defer0 tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabillties in a transaction that affects neither the tax profit nor the accounting profit. The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable proffts will be available to allow all or part of the asset to be recovered. Deferred tsx is calculated at the tax rates that are expected to apply in the perfod when the liability is settled or the asset is realised. Deferred tax is charged or credited in the statement of finanoal activities. except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the Group has a legally enforceable Tight to offset current tax assets and liabilities and the deferred tax ats and liabilities relate to taxes levied by the same tsx authority. 2.12 Financial Instruments The Group only has financial assets and financial liabilities of a kind that qualify as basic financial Instruments. Basic finanoal instruments are initially recognised at transaction value ano subsequently rneasud at their settlements value with the exception of baAk loans which are subsequently measured at amortised cost using the effertive interest method. 2.13 0ratIng Lea Rentals payable under operating leases. induding any lease inntiVeS received. are charged to the SOFA on a straight line basis over the lease term. 2.14 Finance leases and hlre purchase Assets obtained under hire purchase contracts and finance leases are capitalised as tanglble fixed assets. Assets acquired by finance lease are depreoated over the shorter of the lease tenn ant1 their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substanb.ally all of the benefts and risks of ownership are assumed by the Group. Obligations under such agreements are induded in dItors. net of the finance charye allocated to future periods. The finance element of the rental payment is charged to the consolidated statement of financial activities $0 as to produce a constant periodic rate of charge on the net obligation outstanding in each period. 2.15 Pensions The Group operates a defined contribution pension scheme and the pension charge repSentS the amounts payable by the Group to the fund in respect of the year. 2.16 Fund accountlng General and revaluation funds are unrestricted funds which are available for use at the discretion of the Twstees in furtherance of the general objectrves of the Group and which have not been designated for other purposes. Restricted funds are funds which are to be usetl in accordan with specific restriction imposed by donors or which have been raised by the Group for particular purposes. The cost of raising and adminTrstering such funds are charged against the specific fund. The aim and use of each restricted fund is set up in the notes to the finanoal statements. 17
STC Research Foundation Notes to the Consolidated Flnanclal Statements for the year ended 31 December 2023 (continued) 2.17 Grants Grants are reco9nised at the fair value of the asset e1Ved or re1vable when there Is reasonable assurance that the grant conditions will be met and the grants will be received. A grant that specifies perf0rn7ance conditions is recognrsed in incorne when the perfomian conditions are met. Where a grant does not specify perfonnance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the QgnItIon triteria are satisfied is recognised as a liability and held within tleferred income. 2.18 Employee beneflls The costs of short-term employee benefits are recognlsed as a liability and an expense. unless those costs are required to be reco9nised as part of the cost of stock or fixed assets. The cost of any unused holiday entitlement is recognised in the period In which the employee's services are received. Ternilnatlon benefits are cOgniSed immed4ately as an expense when the Group is demonstrably committed to tenninate the employment of an employee or to provide temination benefits. 3. Crltl¢al aecountlng estlmates and Judgements Estimate and judgements are continually evaluated and are based on historical experience and other factors. including expectations of future events that are believed to be reasonable under the circumstances. The Charity makes estimates and assumptions conceming the future. The resulting accounting estimates and assumptions will. by definition. seldom equal the related actual results. The estimates and a55umptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabiljties within the next financial year are discussed below. Critical areas of judgemenL" In the applitation of the group's accounting policies. the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilits.es that are not readily apparent from other sour. The estimates and associated assumpty.ons ère based on historical experlence and other fattors that are considered to be relevant. Artual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the reViSn and fvt periods where the revision affects both current and fijture periods. Key sources of estimatlon uncertainty The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements. Valuation of Land and Bulldlngs Management take into account advice from third parties. including valuations perfom)ed externally and by using all knowledge and infomiatlon available. Support cost allocatlon Management are required to apply judgement in the allocation of sUprt costs acro55 charitable attivities. Such allocation of support costs is disdosed in note 7. 18
STC Research Foundation Notes to the Consolidated Finanaal Statements for the year ended 31 December 2023 (continued) Income from charitable actlvitios Total Funds 2023 Total Funds 2022 Subsidiary charfitsble activities Contratt sales 185,965 51.800 2.023.141 Government grants 638 850 238,403 2,023,991 All income in the current and prior year is unrestrirted. Income from tradlng activities Total Funds 2023 Total Funds 2022 Contract sales 58,230 Trading income 1.876,843 1.876.843 58.230 All income in the current and prior year is unrestricted. Investment Income Total Funds 2023 Total Funds 2022 Rents recelvable 303.570 60.452 Sundry income 9.187 76.874 Investment income 3.688 3.461 316.445 140.787 All income in the current and prior year is unrestricted. Analysis of expendlture on actl¥ltles Actl¥ltles undertaken dlrectly 2023 Support costs 2023 Total Funds 2023 Fam 28.424 28,424 700 Soence 700 Subsidiary trading costs General running costs 114.928 114.928 79.247 79,247 79,247 144.052 223.299 19
STC Research Foundation Notes to the Consolldated Financlal Statements for the year ended 31 De¢ember 2022 (continued) Analy•ls of expendlture on •cllvltl•• (Contlnued) Anlysls of dlr•rt costs Edu¢•tlon/ Fm •qronoffly 2023 2023 Totsl Funds 2023 Sd•hc• 2023 Trndknq 2023 staff costs (note 10) Dirert costs 28.424 700 50.512 64,416 114.928 79,636 64.416 Total 28,424 700 144.052 Analyxls of support costs Sthldlary tradln9 G•n•ral runnlng Tot•1 Fund• 2023 2023 2023 Stsff costs {note 10) Depreclation Office costs 20.412 20,412 8,044 2.135 12.335 3,093 1.747 388 Sundries 10,023 3,093 21.227 196 2,312 Insurance Repairs and renewals Subscriptions Training Bank charges Interest 44 21,271 196 970 970 57 141 2.587 657 2.587 3,427 3,611 747 Auditor's fees 2,770 3,440 Accountancy Legal and professional fees Lossl{profit) on foreign exchange Lossl(profit) on disposal of fixed assets Total 171 747 (160) 438 (160) 438 70.209 9,038 79,247 20
STC Research Foundation Notes to the Consolidated Financial Ststements for the year ended 31 December 2023 (¢ontinued) Anal1• of expendlture on xllvltles (<ontsnu•d) Actlvlt5 undertaken Support Cts dlrectly 2022 2022 Total Fund• 2022 Farni 4,502 (120) 1,368 4,502 (1201 1,368 1.515,705 428.931 Edutationlagronomy Science Subsldiary charltable attivities General running costs 1.515,705 428.931 Totsl 5.750 1,944,636 1,950,386 Analy$l$ of direct costs Educ•tl•n/ Totsl Fund5 2022 F•rm 2022 2022 1022 Staff costs 4.502 (120) { 120) 1,368 1,368 5,750 5,750 Totsl 4,502 21
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) Analysls of expendlture 41n activltles (continued) Analysis of support costs Subsidiary tharitable General actlvlties running costs 2022 2022 Total Fvnds 2022 Staff costs 740,522 82.093 54.631 795.153 82,093 19,393 225,324 11,387 5,207 328.496 267.087 68.568 7.072 Depretiation Rates and water 19,393 225,324 11,387 5,207 453 Light and heat Telephone Post and stationery Sundries 328,043 DI¢t costs 267.087 Repairs and renewals Travelling and motor expenses Subcontrartors 68.568 7,072 57.089 57.089 Computer running costs Subscriptions Training Bank charges Cleaning Bank interest 376 376 2,524 5.086 3.856 1.679 2,524 5,086 3,856 1,679 36,997 9,450 7,330 6.595 3.874 36.997 Auditorfs fees 9.450 7.330 Accountancy Legal and professional fees Loss on disposal of fixed assets Total 6,595 3.874 1.515.705 428,931 1,944,636 Operatlons of the charlty 2023 2022 Turnover 51,800 (1,846) 49.954 (38,833) 11,121 58.230 Cost of sales Gross profit Administrative expenses Profit for the financial year after taxation 58,230 (13.434) 44,796 22
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) Audltorfs remumration 2023 2022 Fees payable to the Charity's audltor". for the audit of the Charity's annual accounts for the audit of the Charity's subsidiary annual accounts in respert of all non-audit services not induded above 2,770 2,600 7.300 6.850 S,890 5,530 io. staff costs Group 2023 Grnyp Comparry 2022 2023 Company 2022 Wages and salaries Social security costs 747.708 731.231 24.935 4.906 56.799 57.868 3.441 694 Pension costs 12.667 11,804 150 817.174 800,903 29.124 5,750 The average number of persons employed by the Group during the year wa5 as follows: Group 2023 No. 23 Group 2022 No. Research activities 27 Management and administration Science 38 The number of employees v4hose emoluments (exduding pension contributions. employerfs social seojrity costs but induding benefits in kind) fell within the folbowing bands- 2023 2022 Number Number £60,001 to £70,000 £70.001 to £80.000 Key management are considered to be the Director of Agronomy. Operations Director. Senior Project Manager. Project Manager and Office Manager. Remuneration paid to key management personnel during the year was É244.258 (2022 - £241.017). 23
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) ii. Trustees. remuneration and expenses During the year no trustee received any remuneration or other benefts {2022 - £nill. During the year no Twstee expenses have been incurred {2022 - £nil). 12. Taxatlon 2023 2022 Corporatlon tax Current tax on net income (45.377) {3,689) Adjustment in respert of prior year5 Total current tax credit 13.7171 (3.717) {49,066) Deferred tax Origination and reversal of timing differenr Total deferred tax 7.700 (5.950) 7.700 (5,950) Taxatlon (credit)lexpense on net Income 3.983 (55,016) The actual charge/(credit) for the year can be reconciled to the expected charyel(credit) for the year base on the profit or loss and the standard rate of tax as follows- 2023 2022 Subsidiary profit before tax (l) Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022 - 19%) Effects of: 3SO,783 227.926 82,506 43,306 AdJ"ustments in respert of prior years Research and development tax credit Other tax adjustments Total tax credlt/(charye) for the periixl (3.7171 {3.689) {116.000) (95,900) 41.194 1,267 3,983 {55,0161 (l) The artivities of the charity remain within the charitable tax exemptions, as such the income subject to taxation relates to the proftt before tax within the trading Subsidiary only. Deferred tax balances at the reporting date are measured at 25% (2022: 25%). 24
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) 13. Tanglble fixed assets Group Flxtures and Motor Computer flttlngs vehlcles equlpment Freehold Plant and property mathlnery Total Cost or valuatlon s at l January 2023 3.054.462 819.932 20,582 49.870 65,511 4,010,357 108,824 Additions 7.609 100.270 945 Disposals As at 31 December 2023 (592) (219,658) {4,443) (18.025) {44.588) {287,306) 3.061.479 700.544 16,139 31.845 21.868 3.831,875 Depreelatlon At l January 2023 146.699 659.458 18.294 23,768 653 56.655 904,874 Charge for the year 20.942 64.901 555 2.323 89,374 On disposals As at 31 December 2023 (96) (216.810) (4,275) {17.702) (43.552) (282,435) 167.545 507,549 14.574 6,719 15.426 711.813 Net book values As at 31 December 2023 2.893.934 192.995 1,565 25.126 6.442 3.120,062 As at 31 December 2022 2.907,763 160.474 2,288 26.102 8.856 3.105,483 The charitable company had no tangible fixed assets In vJther this or the prior year. Land and buildings include property leased to third parties, the fair value of the investment property component cannot be measured reliably. and as such the entire property has been accounted for as property. plant and equipment. Included in cost or valuation of freehold land property Is freehold land with a carrying value of £2,014.837 (2022 - £2.014,837) which is not depreoated. Freehold land and buildings were valued by the dirertors of the subsidiary, supported by an independent valuation in September 2015. Both the directors of the subsidiary and the trustees of the charity do not consider the value to differ materially at the balance sheet date. If freehold land and buildings had not been revalued they would have been induded at the following historical cost.. 2023 2022 Cost Accvmulated de Carrylng value 1,633.878 163,949 1.469.929 1.626.861 143,447 1,483,414 reciation A Tron$stributable revaluation reserve of £1.424,005 (2022 - £1.424.349) exists in respect of the revalued land and bvildings. 25
STC Research Foundation Notes to the Consolldated Flnanclal Statements for the year ended 31 December 2023 (contfnued) 13. Tanglble flxed amets (<ontlnued) The net carrying value of tanglble fixed assets indudes the following in respert of assets held under hlre purchase contracts are as follows: 2023 2022 Plant and machlnery Flxtures and fittings Com uter ul ment Carryln9 value 12,375 1,162 16,500 1.549 16,004 21,338 14. Flxed asset Invqstm•nts Unllsted Investments 2023 Unll•t•d Investments 2022 Group Cost or v•lu•tlon As at l January 2023 Additions 11.570 8,109 3,461 11,570 At 31 December 2023 15,258 Net book v•luo As at 31 December 2023 15.258 11,570 Charlty Investment In subsidiary cOmnY Cost at l January 2023 and 31 December 2023 26
STC Research Foundation Notes to the Consolldated Flnancial Statements for the year ended 31 December 2023 (continued) 14. Flx•d asset Inv¥tm•nts (contlnued) Prlndpal Subsldlarles The followlng is a subsidiary undertaking of the Charlty: frloldlDq N•me numb•r stockbridge Technology Centre Umited 04175440 loo% The financlal SuItS ol the subsidlary for the year. which have been induded In the consolidated results of the charity, We . Tax Profft •fter Income Exp•ndltsr• charye tax for the N•t ••Mts ywr N•m• Stockbridge Technology cent Limited 2.062.808 1,712.025 3,983 346.800 3,563,487 15. St¢)¢ks Group 2023 Group 2022 Raw materlals and consumables 61,364 85,850 The charity had no stock in either the current or the prior year. 16. Group 2023 Charlty 2023 2022 2022 Du• wlthln one year Trade debtors Corporation tax recoverable Prepayments and accrued income 393.639 49,066 87.003 529,708 503,705 104.175 79,670 687,550 1,706 4,340 18.956 23,296 1,706 27
STC Research Foundation Notes to the Consolldated Financial Statements for the year ended 31 December 2023 {continued) 17. Credltors: Am¢yunts falllng due within one ar Group 2023 Charlty 2023 2022 2022 Bank loans (note 19) Trade COIt0rS Amounts owed to subsidiary other taxation and soaal security Flnance leases and hire purchase (note 211 Other creditors Accruals Deferred income (note 20) 131,970 205.719 109.122 146,721 2.17S S2 90.008 143,807 3.185 4.050 3.440 144.253 7.489 586,064 689 48.910 99,517 552.816 6,132 5.760 8,307 5.812 18. Credltots: Amounts falllng due after more than one year Group 2023 Group 2022 Bank loans - 1-2 years (note 19) Bank loans - 2-5 years (note 19) Net obligations under finance lease and hire purchase contracts (note 21) 88.265 137. 160 142.832 314.228 3.185 231.097 454.573 The charity had no creditors due over one year in either thi5 or the prior year. Hire purchases are secured against the assets to which they relate. 19. Loans and overdrafts The following secured debts are included within creditors: Group 2023 Group 2022 Bank loans due within l year Bank loans due after l year 131,970 109.122 231,097 363,067 451,388 560.510 The group has two loans with Virgin Moneyi the first loan has a balance of É314.228 ind the second loan has a balance of £48,839. Interest on both loans is charged at 4.25% over base. Monthly capital nd interest payments are made with the final balance settled or Tinanced at the maturity date. These loans a secured by a debenture creating a fixed and floab.ng tharge over the a55ets of the company. a legal first charge over 12.5 acres at Cawood and a legal first charge over St¢)ckbridge House. Cawood. 28
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) 20. Deferred Income Group 2023 Group 2022 As at l January 2023 Amount released to income 99.517 34,914 (99,517) (34,914) Amount deferred in the year As at 31 December 2023 21. Hlre pur¢ha$e obligatlons Group 2023 Group 2022 Future mlnimum payments due under hlre purchase: within one year In two to five years 3.185 4,050 Hire purchases are secured against the assets to which they relate. 22. Deferred taxation 2023 2022 Group At the beginning of the year Charge for the year Closing deferred taxation liability 266,100 272,050 7,700 (5,950) 273,800 266,100 The deferred tax balance is made up as follows: Group 2023 Group 2022 Accelerated capitsl alloWanS 273,800 266.100 273,800 266,100 The charity had no deferred tax asset or liabilty In 2023 {2022 £nil). 29
STC Research Foundation Notes to the Consolidated Flnancial Statements for the year ended 31 December 2023 (continued) 23. Statement of funds - Group Statement of funds - Balance at xpenditure Transfers 31 (indudln9 between December taxatlon) funds 2023 Balance at l January 2023 Income UnrutriLtsd f•Jnds General funds - all funds 1.942,919 2.431.691 {2,073.770) 344 2,301,184 Revaluation reserye 1.424,349 (344) 1.424.005 Total funds 3.367.268 2.431.691 (2,073,770) 3,725.189 All income and expenditure during the year are unrestrirted. Statement of funds - prlor year Balance at Expenditure Transters 31 (includin9 between December taxation) funds 2022 Balance at l January 2022 Zncome Unrestri¢ted funds General funds - all fiJnds 1.614,596 2.223.008 1.425.034 (1.895,370) 685 1,942,919 Revaluation reserve (685) 1,424.349 Total funds 3.039,630 2,223.008 (1,895,370) 3,367,268 All income and expenditure during the prior year are unrestrirted. 24. Summary of funds - Charlty Summary of funds - current year Balance at Transfers 31 between December funds 2023 Balance at l Jawary 2023 Income Expenditure General funds 150.586 51.800 (40.679) 161.707 Total fund$ 150.586 51,800 (40.679) 161,707 All income and expenditure during the yeaf a unrestricted. 30
STC Research Foundation Note$ to the Consolidated Financlal Ststements for the year ended 31 December 2022 (continued) 24. Summary of funds - Charlty (contlnued) Summary of funds - prlor year Balance at Trnnsfern 31 tween December funds 2022 Balanc• at 13•nuary 2022 Income Expendlturn General funds 105,890 58,230 {13.534) 150,586 Total fund 105,890 58,230 {13.534) 150,586 All Income and expenditure durin8 the prior year are unrestricted. 25. Reconclllatlon oe nrt movement In funds to net c•sh flow from oper•tlng •ctlvltl•$ Gr•up Group 2023 2022 Net inttme after tax 357,919 327,638 Adjustments for.. Taxation chargedl(credited) Depreciation 3,983 (55.016) 82.093 89,374 Investment Income (316.445) 28.746 (140.7871 36,997 3,874 (12.111) 87,485 248,490 578,663 Interest expense Loss on the sale of fixed assets 4,871 24.486 Oecrease/(increase) In stocks Decrease in debtors 100,610 13,390 306,934 InCaSe in creditors Net cash provided by operating activitie5 31
STC Research Foundation Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (continued) 26. Analysis of cash and &ish aqulvalents Group 2023 Group 2022 Cash In hand 114 Cash at bank 1.089.758 750,190 750.304 Total cash and cash equivalents 1,089.758 27. Analysis of changes In net debt Ati January 2023 At31 December 2023 Loan Ilows advances Cash at bank and in hand 750.304 339.454 1,089.758 8ank loans due within l year Bank loans due after l year Finance leases and Hire Purchase Contracts (109. 122) (22.848) (131,970) {231,097) (3. 185) {451,388) 220,291 (7,235) 4.050 182.559 540.947 723.506 28. Operatlng lease commitments At 31 December 2023 the Group had no operating lease commitments (2022 - £nil). 29. Related party transartlons Group Included wbthin remuneration of key management personnel is paid £34,082 (2022 - £34.567) paid to the Project Manager, the daughter of P R Branfield, a trustee. this is paid by the subsidiary entity in which she 15 employed. The trading Sudiary traded with Yorkshire Botanicals Limited. an entity in which N D Bartle is also a D1Ctor. During the year. sale5 of E 120 (2022 - £120) We made to Yort(shire Botanicals rnited and purchases of £318 (2022 - £9.716) were made from yorkshi Botanicals Limited. The trading subsidiary traded with FreshGro. an ents.ty in which M Evans is the CEO. During the year, sales of £nil (2022 - £nill We made to FShGr0 and purchases of £3.500 (2022 - £nil) were made from FreshGro. Charity During the year the charity was recharged various expenses from its trading subsidiary. Stockbridge Technology Centre Limited. During the year recharges of £2, 175 (2022 É521 were made to the charity. at the balance sheet date thi5 balance remains in creditors= amounts due to subsidiary. 32
STC Research Foundation Independent Auditorfs Report to the Members of STC Research Foundation Oplnion We have audited the financial statements of STC Research Foundation Cthe parent charitable company? and its subsidiaries fthe group? for the year ended 31 December 2023 which comprise the Consolidated Statement of Finanaal Artivfcies. the Consolidated Balan Sheet. the Charity Balance Sheet. the Consolidated Statement of Cash Flows and the related notes. induding a summary of significant account pdicies. The financial reporting framewor that has been applied Sn their preparation is applicable law and United Kingdom Accounting Standanls. including Financial Reporting Standard 102- The Financial Reports"ng Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Apted AcctyJnting Prartice). In our opinion, the financlal statements: give a true and fair view of the State of the Grwp's and of the parent charitsble company's affairs as at 31 December 2023 and of the Group's incorne and expenditure for the year then ended; have been properly prepared in accordance with United Kingdom Generally Attepted Accounting Practice- and have been prepared in accordance with the requirements of the Companies Art 2006. Basis for oplThlon We condurted our audit in accordance with 1nternab.onal Standards on Auditing (UK) (ISAS {UK)) and applicable law. Our responsibilities under those standards are further described in the Auditorfs responsibilities for the audit of the finanoal statements section of our report. We are independent of the Group In accordan with the ethical requirements that a relevant to our audit of the financial Statements in the UK, including the FRC'S Ethical Standard and we have fulfilled our other ethical responsibillties in accordance with these reqUirnets. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinlon. Conduslons relatlng to golng concern In auditing the financial statements, we have conduded that the Trustees, use of the going concem basi5 of accountlng 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 rnay cast significant doubt on the charity's ability to continue as a going concem for a period of at least twelve months from when the financial statements are authorised ft)r Issue. Our responsibilities and the ponsibIlitieS of the Trustees with respert to going concem are described in the relevant sections of this report. Other inforniation The other infomiation comprises the information included in the annual report other than the financial statements and our auditor'5 report thereon. The Trustees are responsible for the other information contained within the annual report. Our opinion on the finanoal 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 inforniation 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 incons1Stencie5 or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements thernselves. If, based on the work we have perfom)ed, we condude that there is a material misstatement of thi5 Other inforniation. we are qUIred to report that fact. We have nothlng to report in this regard.
STC Research Foundation Independent Auditor's Report to the Members of STC Research Foundatlon (continued) Opinions on other matters prescrlbed by the Companies Art 2006 En our opinion, based on the work undertaken in the COU of the audit: the Information given in the Trustees. Report induding for the financial year for whlch the financial statements are prepad is consistent with the financial statements. and the Trustees. Report has been prepared in accordan with applicable legal requirernents. Matters on which we are requlred to report by exetptlon In the light of the knowledge and understanding of the Group and charitable company and Its environment obtained in the course of the audiL w4R have not identified material mi5Statements In the Trustees, Report. We have nothing to report in respect of the following mattets in relation to which the Companies Act 2006 require5 US to report to you rf, in our opinion: adequate accounting records have not been kept or returns adequate for our audit have not been received from branches not Vistted by us. the financial statements are not irt agreement with the accounting records and returns: certain disdosures of fnjstees. muneratIon specified by law are not made: or we have not obtained all the informatlon and explanations necessary for the purposes of our audit. Responsfjbllltles of the trust$ for the flnanaal statements As explained more fully in the Trnstees, sponSibl11t1eS statement. the trustees are responsible for the pparatIOn of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the tnjstees determine is necessary to enable the pparatIOn 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 charitable company's ability to continue as a gorng concem, disclosingi as applicable. matters related to going concem and using the going concem basis of accounting unless the Trustees either intend to liquidate the Group or charitable company or to cease operations. or have no realistic alternative but to do so. Auditor's re5ponsibllltles for the audit of the flnanoal statements Our objectives are to obtsin reasonable assurance about whether the financial ststements as è whole are free frorn material misstatement, whether due to fraud or error. and to issue an auditor's port that includes our opinn. Reasonable assurance is a high level of assurance but is not a guarantee that an audit condurtetl Fn accordance with ISAS (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if. individually or in the aggregate, they could reasonably be experted to influence the economic decislons of users taken on the basis of these finanoal statements. A further description of our responsibilities is available on the Financial Reporting Councfil's website at: https'.l/www.frc.org.Uk/auditorsresnslbllitye$. This description fomis Part of our auditor's report.
STC Research Foundation Independent Auditor's Report to the Members of STC Research Foundation (continued) Extent to which the audit was consldered capable of detecting Irregularltles, Indudlng fraud Irregularities. induding fraud, are instances of non-compliance with laws and regulations. We design prOdureS in line with our responsibilities. outlined above and on the Financial Reporting Council's website. to detert material misstatements in respect of irregularitie5. induding fraud. We obtain and update our understanding of the Group. its acb"vities, its control environment, and likely future developments. induding in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding. we identify and assess the risk5 of material mi55_tstemenl of the financial statements, whether due to fraud or error. design and perform audit procedures responsive to those risks. and obtain audit evidente that is Sufficient and appropriate to provide a basis for our opinion. This include5 considerats'on of the risk of acts by the entity that were contrary to applicable laws and regulation5. induding fraud. In response to the risk of irregularitses and non-compliance with laws and regulations, indudlng fraud, we designed procedures which induded: Enquiry of management and those charged with governan around actual and potential litlgation and daims as well as actual. suspected and alleged fraud- Reviewing minutes of meetings of those charged with governance- Assesslng the extent of cornpliance with the laws and regulations considered to have a direct material effect on the financial statements or the operation5 of the tharitable company and the group through enquiry and inspertion: Reviewing finanaal statement disdosures and testing to 5UPPOrtlng documentation to assess COTnpliance with applicable laws and regulations.. Performing audSt work over the risk of management bias and override of controls. Includlng testing of joumèl entries and other adJustments for appropriateness. evaluating the business rationale of significant transactions outside the norn)al course of business and vIewIng accounting estimates for indicators of tentIal bias: and Performing audit work over the timing and recognition of income and in particular whether it has been recorded in the correct accounting period. Because of the inherent limitations of an audit, there is a risk that we will not detert all irregularities, inclvding those leading to a material misstatement in the financial statements or non-compliance w¥th regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-cornpliance. The risk of not deterting a material misstatement resulting from fraud is higher than for one resulting from error. as fraud may involve collusion. forgery. intentional omissions, misrepresentats"ons, or the override of Intemal control. 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 Art 2006. Our audit work has been undertaken so that we might state to the Group and charitable company's members those rnatte we a required to state to them in an Auditor's report and for no other purpose. To the ftjllest extent pemitted by law, we do not accept or assume responsibility to anyone other than the charitable company and its members as a body, for our audit work. for this report. or for the opinions we have fomied. &AEbottohf Alan Sldebottom (Senlor Statutory Audltor) Azets Audit Services Umlted Chartered Accountsnts Statutory Audltor Triune Court Monks Cross Drive York Y032 9GZ