# **National Forest Company Annual Report and Accounts** For the year ended 31 March 2022
**HC 825**
**24/11/2022 14:37**
**E02755195_HC 825 National Forest Company ARA 21-22.indd 2**
## National Forest Company Annual Report and Accounts 2021‑22 For the period 1 April 2021 to 31 March 2022
Presented to Parliament pursuant to Article 6 of the Government Resources and Accounts Act 2000 (Audit of Non‑profit‑making Companies) Order 2009
Ordered by the House of Commons to be printed on 24 November 2022
HC 825
© Board of Trustees of the National Forest Company copyright 2022
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ISBN: 978‑1‑5286‑3410‑6
E‑Number: E02755195
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Printed in the UK by HH Associates Ltd. on behalf of the Controller of His Majesty’s Stationery Office
## **Contents**
|Chair’s letter|2|
|---|---|
|Chief Executive’s foreword|3|
|Directors’ Annual Report|4|
|Strategic Report|7|
|Board of Trustees|13|
|Sustainability Report|16|
|Statement of Trustees’ and Accounting Officer’s Responsibilities|19|
|Governance Statement|20|
|Remuneration and Staff Report|27|
|The Certificate and Report of the Comptroller and Auditor General to the Members||
|of the National Forest Company and the Houses of Parliament|31|
|Combined Statement of Financial Activities and Income and Expenditure Account||
|for the year ended 31 March 2022|35|
|Balance Sheet|36|
|Statement of Cash Flows for the twelve months ended 31 March 2022|37|
|Notes to the Accounts|38|
## National Forest Company
Enterprise Glade, Bath Yard, Moira, Swadlincote, Derbyshire DE12 6BA email: enquiries@nationalforest.org Tel: +44 (0) 1283 551211
nationalforest.org
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## **Chair’s letter**
This has been a pivotal year for the National Forest Company (NFC). Discussions with the National Forest Charitable Trust (NFCT), long our partners in developing the Forest, have secured a merger of our two bodies which took effect on 1 April 2022. For us, the merger will bring with it some 165 hectares of land, a string of assets including the National Forest Youth Hostel, and the award‑winning Conkers Visitor Centre. Further it will provide us with an opportunity to showcase and demonstrate a more focused approach to the Heart of the Forest itself, better deliver our charitable aims, and generate new commercial income streams.
My thanks go to the outgoing Chair of the NFCT, Stephen Woolfe, and the Project Director, Mike Ballantyne, as well as both Boards and the NFC team for all their endeavours in making this happen.
Whilst the country faces an uncertain post‑COVID world, faced with the challenges of climate change, declining biodiversity and growing economic tensions, the National Forest has a positive story to tell. This report demonstrates our ongoing success, not least another 200 hectares of forest creation, with its multitude of benefits to nature, carbon and people. Our work continues to contribute to DEFRA’s Nature for Climate Fund and to the England
Tree Planting Programme, and through our ongoing innovation, collaboration and communication we can rightly claim to be leaders in forestry creation and management.
A particular thanks to my fellow trustees for navigating a complicated year in which we have advanced a busy programme, through meetings both virtual and in person. I am also delighted that the merger has allowed us to grow our Board, and we welcome Penny Coates as a Trustee, and Andrew Bridge and Martin Traynor who will see us through the transition period.
This year more than ever we have taken heart from engaging with our partners – businesses, funders, communities, landowners and the wider community. Can I thank you all for your support and I look forward to re‑energising our relationships in the year ahead.
Lord Duncan of Springbank PhD FGS Chair of the Board of Trustees
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## **Chief Executive’s foreword**
This has been another challenging year of COVID‑19 restrictions, economic pressures and the wider backdrop of global uncertainty. However, I am delighted that even these hardships haven’t knocked us off course in realising our National Forest vision.
Not only has the National Forest Company continued to deliver well against its targets, but it has succeeded in increasing its staffing, income generation and profile to set itself up for the future. This is particularly important as the organisation is expanding in both size and complexity as we merge with the National Forest Charitable Trust (NFCT). Indeed, I would like to thank colleagues at the NFCT for their support in the merger discussions this year which has helped to ensure a smooth and collaborative transition.
Below are a few selected highlights from 2021‑ 22 that show how our work continues to have a positive impact both for the Forest and on a national stage:
- Securing another 200 hectares of new forest habitat, including a major new Country Park, to continue to accelerate tree planting in the face of climate change.
- Acquiring additional land at Newchurch for new woodland creation and public access.
- Progressing the merger with the National Forest Charitable Trust and developing the masterplan vision for the Heart of the National Forest.
- Signing a Tree Charter in partnership with Leicestershire County Council to demonstrate our joint commitment to trees and action on climate change.
- Establishing the extensive Minorca Woodland site near Measham with new tree planting, access and habitat creation, including our carbon storage programme with Fat Face to support their move to net zero.
- Commencing the national healthcare pilot GreenSpring in Derbyshire to explore approaches to green social prescribing.
- Producing a new design guide and investment programme for sustainable tourism accommodation to help stimulate a green recovery for the visitor economy.
- Running a successful Timber Festival with partners, Wild Rumpus, as our first major event following the pandemic, and kicking off the inaugural National Forest Trek.
I have been pleased to see the gradual return of businesses, events, volunteering and schools as COVID‑19 restrictions have eased, and to note that the Forest has been impacted less heavily than other parts of the country. As we look ahead, we will continue to provide support and funds to encourage our communities to continue to enjoy the benefits of the outdoors and promote a greener economy. My thanks, as ever, to the NFC Board and staff team for another incredible year, and for the sterling support of our many partners and individuals without whom our work would not be possible.
Finally, I would like to finish by paying tribute to Caroline Scothern who we sadly lost this year. Not only was Caroline an inspiration to everyone who worked with her, but she embodied the spirit of the National Forest – open, positive and uplifting. We will all remember her fondly and look to re‑double our work on outdoor learning as a fitting legacy.
John Everitt FRSA Chief Executive/Accounting Officer
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## **Directors’ Annual Report**
## Introduction
This report provides the information as required by company law. In addition, as the National Forest Company (NFC) is a registered charity, the report provides any additional information as required by the Statement of Recommended Practice (SoRP) module ‘Trustees’ annual report’. The Trustees have agreed that a single report should be produced providing the required information rather than a separate Directors’ report and Trustees’ annual report.
## National Forest Company status
The National Forest Company was established in April 1995 with the objective of overseeing the creation of the National Forest which spans 200 square miles of central England. The NFC is a company limited by guarantee (registered number 2991970) and a registered charity (registered number 1166563). The NFC operates from its registered office at Enterprise Glade, Bath Yard, Moira, Swadlincote, Derbyshire DE12 6BA.
As a charity since April 2016 and applying the provisions of its Articles of Association, the business of the NFC is no longer under the majority control by the Secretary of State for Environment, Food and Rural Affairs. The NFC does, however, given the levels of grant in aid funding received, continue to place economic reliance on the Department for Environment, Food and Rural Affairs (Defra). Grant in aid is paid to the NFC under Section 153 of the Environmental Protection Act 1990. The NFC’s status is a Non‑Profit Institution within the Public Sector specifically within Central Government as defined by the Office for National Statistics.
## Objectives and activities
The objects of the NFC as contained in its Articles of Association are:
_‘For the public benefit, the conservation, protection and improvement of the physical and natural environment so as to secure and enhance the enjoyment by the public of the same, in particular but without limitation to:_
_facilities for the public at large or those who by reason of their youth, age, infirmity or disablement, financial hardship or social and economic circumstances, have need of such facilities; and the protection or conservation of the environment; and_
- _(c) the advancement of education in the environment and sustainable development through the promotion of training and education and the undertaking and publishing of research.’_
## Strategy and priorities
The National Forest Strategy covering the period 2014–2024 includes the following priorities:
- Creating and managing a Forest for the nation
- Creating the visitor destination and making the most of the asset
- Creating the Forest for Everyone
- Governance, income generation and marketing
The Strategy is based on creating a resilient Forest environment, continuing to move forward with new forest creation and increasing the emphasis and investment in woodland management. It also includes a focus on a Forest society, increasing new access routes and engaging people and communities in outdoor activity through education, volunteering and enjoyment. In addition, the Strategy prioritises work to create a sustainable Forest economy, developing the visitor, woodland and green economy in line with the Forest brand. To support this, the Strategy recognises the organisational development required for the NFC to meet future challenges, including upgrading its governance and systems as a new charity, growing its income to increase financial sustainability, and building a stronger brand.
Grant funding from Defra contributed significantly towards the delivery of objectives for the year, whilst simultaneously contributing to the delivery of the Defra Strategy, 25 Year Environment Plan and Departmental objectives.
## Public benefit
- _(a) woodland creation and management generally, and in particular in the area of the National Forest, for the benefit of the general improvement of land or for the environment;_
- _(b) the promotion of urban and rural regeneration by the maintenance, improvement or provision of public amenities; the provision of recreational_
In overseeing the strategic direction and activities for the year, the Trustees have been mindful of the Charity Commission guidance on public benefit and are satisfied that the NFC complies with these requirements.
The National Forest acts as a national exemplar of sustainability and its public benefit is based on its
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environmental, social and economic outcomes to mitigate and adapt to climate change.
The direct environmental benefits include the restoration of the landscape from planting more than 9 million trees and the services that this provides for our natural capital including carbon sequestration, clean air and water, and protection of soils, as well as the protection and enhancement of wildlife. This has particular resonance as we respond to the urgency of both climate change and biodiversity loss. Social benefits relate to the physical and mental wellbeing of individuals who engage with the Forest and the considerable benefits that are derived from programmes that promote access, volunteering, education, skills and training, improving the equality of these opportunities for all our communities. Economic benefits are provided to society as a whole through promoting more sustainable livelihoods, shifting to a low carbon and circular economy that reduces negative impacts, and through targeted work with deprived communities.
The benefits are felt by the 209,000 residents living within the National Forest area, many of whom are from disadvantaged backgrounds and under‑represented groups in our urban and rural areas; the c9 million visitors who enjoy the Forest as a destination each year; the 342,000 plus individuals who experience the National Forest through the website; the 16m people impacted by media and communications activity, and the expanding audience of supporters, partners and stakeholders who are inspired to engage with our work.
## Volunteering statement
It is central to the ethos of the National Forest’s development that local communities, businesses and visitors are offered opportunities to become engaged in creating and looking after the Forest, helping to underpin more sustainable, cost effective and resilient management. Volunteering has played a key role in this. Since its creation, the NFC has facilitated a wide range of organisations across the Forest to offer volunteering opportunities; for example, since 1997, 32,715 volunteer workdays have been arranged in the Forest by The Conservation Volunteers (TCV) where activities included conservation, woodland creation and management, and wildlife monitoring projects.
The NFC itself is also directly involved in the engagement and deployment of volunteers, with a volunteering policy approved by the Board. During 2021‑22, the NFC continued its volunteering activities through the Creating Working Woodlands project funded by Esmée Fairbairn Foundation, and further training for volunteers involved in the
Timber Festival. Despite still being impacted by the COVID‑19 pandemic, the volunteer sessions in 2021‑22 increased to more than 40,000 hours, with an approximate value of £380k.
## Equality, Diversity and Inclusion
Diversity and inclusion of our staff and volunteers, as well as ensuring that the National Forest attracts and engages with a diverse range of audiences and stakeholders is a key priority. During the year we extended our Equality, Diversity and Inclusion strategy with key priority actions being taken forward by a small staff working group led by a Trustee. Work includes ensuring that the Forest’s vision, programme of work, projects and processes show due regard for diversity and inclusion and consider the impact of decisions on under‑represented groups, including those having access to grants and support.
## Grant making policy
The NFC’s grant making is targeted to support public benefit and the charity’s objects in line with Charity Commission guidance, and guidance set out in Managing Public Money. Grants awarded are an important means of delivering multiple Forest objectives including forest creation, woodland management, biodiversity, access, arts and culture, and community programmes. Grants are administered through an assessment process that considers priorities, impact and value for money. Higher level grants are approved annually by the Board and smaller grants by Trustee‑led Working Groups. This provides the necessary assurances and includes grant conditions for recipients to ensure that charitable purposes are adhered to. Forest creation is secured through grants awarded via the Changing Landscapes Scheme (CLS), for areas greater than 1 hectare (ha).
The woodland management grant programme supports active management of woodlands covering a range of objectives including forestry, wildlife, access, landscape and community use. In 2021‑22 the woodland economy grant scheme was again run to stimulate an increase in economic activity designed to sustain woodlands into the future. Qualifying projects are normally eligible for up to 60% of total costs, with some funded programmes paying 100%.
Small grants to communities and organisations are made through the Small Grants Fund (SGF). The SGF supports activities and projects that include access, arts and culture, community, heritage, wildlife and recreation. Grants normally cover up to 50% of project costs, helping to lever additional funds to support the Forest.
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Grants totalling £1,228,071 were awarded during 2021‑22 (2020‑21: £581,243). Note 17 of the accounts provides an analysis and information on grant recipients. The increase is largely due to Forest Creation grants awarded during the year including £300,000 to the National Forest Charitable Trust (2020‑21: £ nil) to facilitate transfer of land as part of the merger negotiations. The Changing Landscapes (CLS) grant scheme awarded £504,180 (2020‑21: £271,323). COVID‑19 still continued to have an impact on the number of grants awarded this year, most notably on our Creating a Forest for Learning project; 12 grants totalling £12,874 (2020‑21: £10,748) supported schools to provide outdoor learning training for school staff and to enhance the outdoor learning environment within schools through woodlands. The second year of the Habitat Enhancement Grant was run in 2021‑22 with funding from Severn Trent Water. The ‘Severn Trent Great Big Nature Boost’ supports work on biodiversity restoration and enhancement across the Forest; 24 grants totalling £128,170 (2020‑21: £78,872) were awarded. To provide additional support to businesses and communities impacted by COVID‑19, grant schemes were targeted this year for work on Arts and Health & Wellbeing as well as support on Sustainable Tourism. This included an additional 13 grants totalling £23,354 (2020‑21: £13,200) to support a green recovery and target communities most in need.
The NFC works collaboratively with other charities in the pursuit of its objectives, including grants this year to the National Memorial Arboretum, Woodland Trust and National Trust.
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## **Strategic Report**
## Financial overview
An operating surplus of £0.871m was achieved in 2021‑22 (2020‑21: £2.001m) comprising £0.520m unrestricted (2020‑21: £0.462m) and £0.351m relating to restricted projects (2020‑21: £1.540m). The unrestricted surplus resulted from over achievement of income generation targets and savings on marketing and staff costs as a result of delays in recruitment.
Total income during 2021‑22 was £5.842m (2020‑21: £5.614m) of which £2.401m is grant in aid from Defra (2020‑21: £2.467m) and £1.894m being the second year of the Nature for Climate Fund programme (2020‑21: £2.146m) also funded by Defra. The NFC continues to rely heavily on Defra funding and the high priority given to forestry and net zero within government and reflected in the recent Spending Review gives confidence that both grant in aid and Nature for Climate Fund will continue at broadly similar levels. Despite the uncertainties in the wider economy, corporate sponsorship and donations income continued to increase and unrestricted income of £0.710m was secured (2020‑21: £0.533m).
Expenditure during 2021‑22 was £5.165m of which unrestricted expenditure was £2.632m and restricted expenditure was £2.533m (2020‑21: total expenditure £3.478m, unrestricted expenditure £2.521m and restricted expenditure £0.957m). 41% (2020‑21: 33%) of the total expenditure was spent on forest creation (Note 7), securing the target of more than 200 hectares of new forest habitat whilst also helping to deliver associated targets.
Restricted project income was £2.686m in 2021‑22 (2020‑21: £2.587m), largely comprising £1.894m Nature for Climate Funds, £0.307m for the Charnwood Development Project and £0.202m for the Severn Trent Great Big Nature Boost project. These projects with their third‑party funding make a significant contribution to the delivery of corporate priorities, and can also contribute to core cost recovery. Restricted funds reserves for 2021‑22 stand at £2.427m (2020‑21: £2.075m) as a result of land acquisition of £0.665m through the Nature for Climate Fund and planned expenditure from reserves being met through the budget from increased fundraising.
The NFC continues to act as an enabler, working in partnership with others to deliver its priorities. The awarding of grants remains an important means of delivering these priorities and during the year grants totalling £1.228m were awarded, significantly
up on last year (2020‑21: £0.581m). No grants were made to support land acquisitions in 2021‑22.
£0.126m of contributions and match funding was transferred from unrestricted funds to restricted funds for the ‘National Forest Trek’, National Forest ‘Timber’ Festival, Community Forest Woodland Outreach project and the ‘ELMS Test and Trial’ project.
At the end of March 2022, the NFC reserves had increased from £8.834m to £9.705m.
## Fundraising Statement
The NFC is registered with the Fundraising Regulator and abides by its Code of Fundraising Practice, ensuring that fundraising activities are legal, open, honest and respectful. The standards can be accessed via the Fundraising Regulator website fundraisingregulator.org.uk. The NFC does not use the services of professional fundraisers.
The NFC’s Development Working Group, comprising two Trustees, and reporting to the Board, is responsible for oversight of the income generation strategy which includes fundraising. Two fundraising specialist advisors were added to the Working Group in the year to provide additional expertise and challenge. Operationally, responsibility for the development, management and monitoring of fundraising activities is carried out by the NFC’s Development Team; this includes the Fundraising and Development Manager who is a Full Member of the Institute of Fundraising.
No complaints have been received about the NFC’s fundraising practice.
## Achievements against targets for 2021‑22
Despite the ongoing difficulties experienced as a result of the pandemic in 2021‑22, the NFC was still able to meet its core targets and outcomes for the Forest. The grant and land acquisition pipeline for new forest creation was heavily impacted by COVID‑19 but compensated by delivery through the planning system, and the purchase of a new site at Newchurch. This meant that the NFC was still able to successfully exceed the milestone of 200 hectares of new forest habitats at 202ha (2020‑21: 212ha), pushing the forest cover figure above 22% of the total land area and ensuring continued progress towards our long term ambitions. As with previous years, the mechanisms of land acquisition, planning, advice and grant schemes were all used to secure new forest creation, including the significant
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contribution from planning schemes, in particular the creation of a new Country Park at the former Nailstone Colliery site. Forest creation activity has also helped to deliver 137 hectares of new access this year which, while just short of the 150ha target, provides significant additional public benefit to communities.
Alongside forest creation, our work to secure good management of woodlands was extended this year with grants, support and advice helping to ensure that 445ha of woodlands were either brought into or renewed their active management. This has continued to ensure woodlands in active management exceeded 80%, well in excess of the national average. The Habitat Enhancement Grant with Severn Trent’s Great Big Nature Boost programme meant that 138 ha of priority wildlife habitats were restored or enhanced, helping to improve connectivity across the Forest and support threatened species, including bats and the great‑ crested newt. Nature for Climate Funds also helped the NFC secure the release of 150ha of land in the Heart of the Forest as part of the planned merger with the National Forest Charitable Trust, which will complete in 2022‑23 and bring more land into better management for wildlife and people. The target for trees planted was also exceeded at more than 200k, making up for recent reductions resulting from the pandemic and significantly higher than the 178k last year. This included significant planting and site development works at the new Minorca Woodland near Measham.
Our community work was again challenged this year as a result of COVID‑19 and the tragic death of a much loved colleague, Caroline Scothern, who led our work on outdoor learning so successfully. Face to face activity returned for the Creating a Forest for Learning project and Forest Foxes pilot in conjunction with Leicester City Football Club Community Trust. The outdoor learning campaign increased primary schools engaged in regular outdoor learning to 63% (up from 61% in 2020‑21),
with benefits extending to deprived communities and inner‑city schools in Leicester.
Outdoor activities also returned for partners in the Charnwood Forest Landscape Partnership Scheme supported by the National Lottery Heritage Fund, as well as the Creating Working Woodlands project, both helping to grow volunteering, small business development and community engagement following lockdown. Volunteering activity returned to more than 40,000 hours during the year and the number of community groups managing woodlands continued to increase. This work was complemented by the establishment of a new national social prescribing pilot project, GreenSpring, in conjunction with a health sector partnership in Derbyshire and funded through the Department for Health and Social Care.
COVID‑19 support for businesses and communities was also enhanced by new grant schemes targeted to arts, wellbeing and sustainable tourism activity. These ranged from community arts to mindfulness walks, as well as a major programme of support aimed at stimulating new sustainable tourism accommodation in the Forest led by the production of an innovative new design guide for planners and developers.
Live events returned during the year with a successful Timber Festival run by partners Wild Rumpus and featuring a mix of local, national and international programming using arts to connect people to forests and nature. The inaugural National Forest Trek, in partnership with the Defence Medical Rehabilitation Centre Benevolent Fund and the National Memorial Arboretum, was also held along the National Forest Way to encourage more active lifestyles.
Activities were underpinned by a diverse programme of research and evidence including on biodiversity, carbon, mapping of land use in the Forest, national trials for the Environmental Land Management Scheme (ELMS), and a new masterplan vision for the Heart of the Forest area.
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## Forest Environment
|Targets
Progress|Targets
Progress|
|---|---|
|Forest Creation:||
|Forest cover to reach 22.5%.|22.3% secured, up from 21.9% at beginning of year. Note that 0.1% =
50 hectares. Some delays due to COVID‑19 (see below)|
|200 – 250ha of forest creation.|Achieved. Total 201.61ha comprising 31.67ha Newchurch land
acquisition, 32.21ha under Changing Landscape Scheme (CLS),
7.85ha under Freewoods and 10.43ha under Parklands. There is
also 102.36ha from planning, 14.37ha of new creation through
Countryside Stewardship and 2.72 from re‑mapping.|
|150,000 trees planted.|Target significantly exceeded catching up on tree planting
delayed last year as a result of COVID‑19. 201,228 trees planted in
total on NFC sites, through NFC grant schemes and as a result of
planning gain.|
|Woodland Management:||
|85% of woodlands in active
management.|80% of woodlands in active management through grants and
support to landowners. Lower result as some previously recorded
sites are no longer under contracted management grants.|
|400ha of woodlands brought or
retained in active management.|Exceeded. 445ha achieved comprising new areas brought into
active management and renewals.|
## Forest Society
|Targets|Progress|
|---|---|
|Access creation:||
|80% of Forest sites created with
public access.|Achieved. 80% public access maintained with access as included as
part of new schemes and acquisitions.|
|150ha of new access created.|137 ha created in total. 31.7ha was created at the Newchurch
acquisition, with a further 36.3ha created under NFC grant schemes
and 68.6ha under planning. New planning sites where the only
access is Public Right Of Way have not been included in the total
but represent a further 6.19ha of partial access. Access figure
below target as a result of more forest creation delivered through
planning gain than grants and acquisitions this year.|
|Promoting outdoor activity:||
|70% of National Forest primary
schools regularly delivering outdoor
learning.|63% primary schools having regular outdoor learning achieved, with
delays as a result of COVID‑19. Many schools pushed back their
outdoor learning grants due to the pandemic.|
|12,000 volunteer sessions
completed in the Forest each year.|Target measurement changed to volunteering hours with
40,909 volunteer hours achieved. A return to events and regular
volunteering, including at Timber Festival, following the relaxation
of restrictions has increased numbers.|
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## Forest Economy
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Targets Progress
Visitor economy:
Increase visitor numbers to 4.57m visitors reported via independent Scarborough Tourism
9.05m pa. Economic Activity Monitor (STEAM) data based on 2021 assessment
of 2020 figures (ie one year in arrears). Whilst numbers were heavily
affected by COVID‑19 restrictions, regional comparison showed
that the National Forest managed to retain more of its visits than
other areas within the East Midlands.
Visitor spend pa increased to £472m Visitor spend decreased in line with visitor numbers, ie £244m, and
and tourism jobs increased to 5,363. tourism jobs dipped to 2,939 based on 2020 STEAM figures. It is
anticipated that these will pick up for the 2021 assessment figures.
4,000 Timber Festival attendees Timber festival was held following previous year’s cancellation, with
(including 2,500 customers). tickets limited to 2,500 guests. Target achieved for guests with an
additional 1,400 production attendees.
Low carbon enterprise:
50 National Forest businesses Achieved. 91 on brand businesses directly supported based on
supported. grants, workshops and consultancy. Impact is more significant as
businesses supported outside the Forest boundary and indirectly
through wider business networking are not included.
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## Securing resources, building the brand, governance and leadership
**----- Start of picture text -----**
Targets Progress
Securing resources:
Increase unrestricted income £710k achieved. Target significantly exceeded with success of tree
for the NFC through sustainable planting packages, corporate support and donations.
resources to £480k.
Generate £500k of new restricted £71k achieved. Project deferrals and delays in applying for new
income. projects reduced restricted income but was made up for with over
performance of unrestricted income.
Achieve a campaign return on ROI of 3:1 achieved with strong campaign performance, in particular
investment (ROI) of 3:1. for the Dedicate a Tree product.
Building the brand:
Increase National Forest website 342k achieved. Target exceeded with refresh of brand and targeted
sessions to 300k. campaigns.
Increase media profile: achieve 200 315 achieved. Target significantly exceeded with increased social
pieces of media content. media activity and strong content.
Governance and leadership:
Board effectiveness: attain Achieved. Assurance achieved through review of previous year’s
assurance based on Charity activity.
Governance Code.
**----- End of picture text -----**
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## Income generation performance
Income generation performance for the year significantly exceeded budget with the Dedicate a Tree scheme and charitable giving performing particularly well. Improvements in digital marketing, social media activity and increased partnership development all helped to raise the profile and reach of the organisation and its work, alongside a new brand toolkit and guidelines to support marketing activity.
Total income for the year was £5.842m of which £4.295m was grant in aid and Nature for Climate Funds from Defra. Income this year included the development of 11 new agreements with partners such as Selective Marketplace and Burleighs Gin, section 106 funds, and income through the Plant a Tree scheme and Dedicate a Tree scheme. In addition, restricted funds were secured from: the Audemars Piguet Foundation for the Creating a Forest for Learning project; Defra/Natural England for the Community Forest Woodland Outreach programme; National Lottery Heritage Fund for the continued work on the Charnwood Forest Landscape Partnership Scheme; local authority partners and others for work on tourism; Esmée Fairbairn Foundation for the Creating Working Woodlands project; NHS Derby and Derbyshire for the GreenSpring social prescribing programme; Severn Trent for the Great Big Nature Boost programme; Defra for the ELMS Test and Trial project and woodland grants. Restricted funds were also received towards the National Forest Festival, ‘Timber’, including grants from Arts Council England and sponsorship from North West Leicestershire District Council and Arnold Laver.
Investment income also increased with Cazenove continuing to manage the NFC’s investment (£0.500m in December 2020) in their Charity Responsible Multi‑Asset Fund in line with our ethical investment policy. The investment policy ensures NFC’s assets are invested in responsible investment funds. The Audit and Risk Committee has responsibility for agreeing strategy and monitoring the investment performance against agreed benchmarks including the objective of inflation plus 4% over the long term. To date, funds have achieved the target net return level of c4% per annum. During the reporting period there were no significant events that affected the financial performance and position of the investment. The fund value as at the reporting date was £0.532m (2020‑21: £0.505m). The remaining reserves are held in instant access fixed‑rate deposit accounts.
## Plans for future periods
Key priorities for the coming year will focus on the ambitions set out in the Corporate Plan 2020 to 2023, as agreed by the Board, and include:
## _National Forest Environment_
- Deliver ambitious Nature for Climate Fund targets to increase forest creation and tree planting using land acquisition, grants, planning and advice.
- Develop the COVID‑19 Memorial Woodland initiative in partnership with the National Memorial Arboretum.
- Further increase active management of woodlands including measures to address pests and diseases.
- Further develop the biodiversity programme for woodland and non‑woodland habitats and key species.
## _National Forest Society_
- Creation of new public access sites and linear trails across the Forest.
- Deliver the National Forest Trek walking event along the National Forest Way.
- Continue the delivery phase of the Charnwood Forest Landscape Partnership Scheme.
- Expansion of project work to increase outdoor learning within primary schools and increase activity with secondary schools, including through the Forest Foxes project.
- Further increase Community Management of Woodlands groups and volunteering, and a new community woodlands programme as part of the Queen’s Green Canopy initiative.
- Increase activities to promote health and wellbeing through the national pilot programme for Green Social Prescribing.
## _National Forest Economy_
- Continue delivery of the Tourism Growth Plan and investment in the visitor economy, including sustainable tourism accommodation and Forest Experience itineraries.
- Run the award winning Festival ‘Timber’ in July 2022 and a wider programme of arts and cultural activities.
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- Complete strategic masterplanning for the Heart of the Forest area and take forward priority actions.
- Support the green economy with targeted grants and advice for the arts, health and woodland economy sectors.
_Cross‑cutting work_
- Enhance communications work with increased content, social and digital marketing, including a new website.
- Develop new income generation opportunities including a regular supporter product, carbon package and strategic corporate partnerships.
- Complete the merger with the National Forest Charitable Trust, and governance arrangements for subsidiary companies.
- Act as charity partner for a new RHS Chelsea Flower Show garden and re‑home in the National Forest.
## Risk Management
The Board is responsible for management and monitoring of the risks facing the NFC. Because of the unprecedented nature of COVID‑19 and the potential impact on the Charity, a Resilience Plan to assess key risks and implications, as well as mitigation measures has been maintained throughout the year. Since the NFC is primarily funded by grant in aid from Defra and acts as an enabling body rather than a direct operator of services, the impacts of COVID‑19 continue to be less severe than other organisations. This means that no staff have had to be furloughed, income streams have not experienced significant impact and most services continued through remote working. With restrictions now having eased, the risks within the Resilience Plan are included in the main risk register for the charity.
The principal risks and uncertainties facing the NFC are set out below with corresponding plans for managing them. Further information on risk and risk management is provided in the Governance Statement.
- Develop a new Corporate Plan beyond 2023, and explore partnership programmes beyond the National Forest boundary.
## Strategic risks
Inability to scale up Forest creation targets, meet Nature for Climate Fund commitments and take advantage of carbon/tree planting opportunities.
Income generation strategy for unrestricted income inadequate and does not meet targets.
Marketing capacity and messaging inadequate and opportunities lost
## Mitigation
Nature for Climate programme steering group and oversight by Land and Forestry Working Group. New staffing, pipeline of schemes and acquisitions, active partnership outreach to identify opportunities. Land agency arrangements to identify and accelerate opportunities. Mapping of opportunities and priority areas. Work on developing new grant scheme and engagement with Defra and partners.
Income generation strategy and product development work to generate new income mechanisms including regular giving and corporate packages. Active website and integration with CRM. Income generation campaign and marketing work to promote offer digitally. Brand strategy work and messaging aligned to 25 Year Vision.
Brand framework and toolkit, new website development, marketing plan, marketing assets and events, integration of work areas, training and development of team, use of freelancers to grow capacity as needed. Research, data and content development.
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**----- Start of picture text -----**
Strategic risks Mitigation
**----- End of picture text -----**
|Loss of Defra support and backing of key partners.|Continue close relationship with Ministers and|
|---|---|
||officials, and as part of Nature for Climate Fund|
||groups. Demonstrate NFC impact and value for|
||money. Raise profile of NFC with MPs, peers and|
||in media, and complete Framework Document|
||sign off. Active engagement in Defra 25 year|
||environment plan. Parliamentary reception. Secure|
||high profile projects with Defra (Education, Urban|
||Trees, Health) and closer working with Defra|
||communications team.|
|Staffing and governance inadequate to manage|Dedicated staffing, governance changes and|
|post‑merger arrangements with NFCT, and ensure|Transition Group to oversee arrangements.|
|ongoing profits for Conkers.|Specialist advice to manage financial changes|
||and impacts. New vision and Strategic Plan for|
||Conkers, Repairs and Maintenance Plan to support|
||investment required, and reserves fund established|
||to mitigate risk.|
## Board of Trustees
The Trustees of the NFC throughout 2021‑22 were as follows:
**----- Start of picture text -----**
Name Date of Role
appointment
as Trustee
**----- End of picture text -----**
|Lord Duncan of|20 May 2020|Chair, Board of Trustees,|
|---|---|---|
|Springbank||Member of Remuneration Committee|
|Tony Ballance|1 April 2016|Member, Audit & Risk Committee,|
|||Chair of Remuneration Committee|
|Jack Buckner|1 April 2016|Chair, Development Working Group,|
|||Member of Tourism, Recreation & Communities Working Group|
|Alison Field|1 April 2018|Member, Land & Forestry Working Group|
|Paddy Harrop|1 April 2018|Chair, Land & Forestry Working Group, Member of Audit & Risk|
|||Committee|
|Anne Jenkins|1 January 2021|Chair, Tourism, Recreation & Communities Working Group|
|Mike Kapur|1 April 2018|Chair, Audit & Risk Committee, Member of Remuneration Committee|
|John Everitt(1)|1 April 2015|Chief Executive|
(1) John Everitt is the NFC’s Chief Executive and also a Trustee. It was agreed that he should hold this dual role because of the nature of the NFC’s current funding position whereby a significant proportion of the NFC’s funds are from Defra and the Chief Executive holds the responsibility of Accounting Officer for those funds. To meet the standards for Managing Public Money, Accounting Officers are required to be represented at Board level. It is recognised that this is unusual within a charity, but is considered to be in the best interests of the charity because of the funding relationship, and controls are in place to avoid any abuse of power or conflicts of interest. The Board has delegated the responsibility for the day‑to‑day management of the Charity to the Chief Executive. The Chief Executive reports directly to the Chair of Trustees and provides advice to the Board.
On 1 April 2022, Penny Coates joined the NFC Board as a Trustee and member of the Audit and Risk Committee.
Information on the recruitment and induction processes for Trustees and an overview of the governance arrangements in place is given in the Governance Statement.
Trustees are required to disclose any interests they have that may potentially conflict with their management responsibilities for the NFC. This includes company directorships, public appointments and any other significant external interests. During 2021‑22 no issues arose as a result of any Trustees’ conflicts of interest. No Trustee,
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other than the Chief Executive who is a Trustee, had any transaction with the NFC, other than being reimbursed expenses necessarily incurred in fulfilling their duties as per Trustees’ travel and expenses (Note 10). Information on the remuneration of the Chief Executive is detailed in the Remuneration and Staff Report.
## Results for the year
The accounts have been prepared in a form directed by the Secretary of State for Environment, Food and Rural Affairs and on the basis of the accounting policies set out in Note 1 to the accounts.
Total income for the year was £5.842m (2020‑21: £5.614m) of which £4.295m (2020‑21: £4.613m) was grant in aid from Defra. Total expenditure was £5.165m (2020‑21: £3.478m).
Total reserves at the end of the financial year increased to £9.705m (2020‑21: £8.834m) of which £2.427m comprised restricted funds (2020‑21: £2.075m) and unrestricted funds £7.279m (2020‑21: £6.759m).
## Reserves
The reserves are held as a series of unrestricted or designated funds. The Audit & Risk Committee reviews the Reserves Policy annually, usually in July, prior to the Board review of the Policy at its subsequent meeting. In 2020, the target ranges for the Unrestricted free reserves fund were increased from £200k to £400k and the Financial Contingency Fund range increased by £100k to £500k – £550k to ensure that the Policy remained appropriate to the needs of the Charity.
After gains and losses on investments the net income was £0.871m (2020‑21: £2.021m).
**----- Start of picture text -----**
Fund Target level/range
**----- End of picture text -----**
|Unrestricted free reserves|£400k|
|---|---|
|Working capital to manage cashflows||
|Financial Contingency Fund (FCF)|£500k – £550k|
|Approximately four months’ running costs to be used in the event of major||
|cashflow problems||
|Land Acquisition, Management and Development Fund (LAMDF)|£400k – £500k|
|To support land acquisition and site establishment costs||
|Enterprise and Investment Fund (EIF)|£300k – £500k|
To support innovation, enterprise, and commercial development, to secure long‑term financial sustainability
As at 31 March 2022, £2.427m of total reserves held were restricted funds as per Note 18, which includes fixed assets and investments of £1.820m, as per Note 20. Balances held in the three designated funds were FCF £500,000, LAMDF £450,000 and EIF £500,000.
The amount of general reserves held after making allowance for restricted and designated funds is £3.196m (2020‑21: £3.488m).
## Going concern
The Balance Sheet as at 31 March 2022 shows that the NFC has total reserves of £9.705m (2020‑21: £8.834m).
Looking ahead, the annual grant from Defra, ie via both Grant in Aid and the Nature for Climate Fund is expected to continue to represent a high proportion of the NFC income. Based on the Government’s high priority for tree planting, grant in aid funding allocated as part of the Comprehensive Spending Review period is projected to remain at
a similar base level to that allocated for 2021‑22 (ie £2.4m). Defra has also allocated a further £2.4m (2020‑21: £2.146m) to the NFC from the Nature for Climate Fund for 2022‑23, and funds at the same level in principle for the following two years. In addition, the NFC’s Board approved income generation strategy is now impacting positively on the Charity’s income streams with increased targets for unrestricted income. The NFC’s bank balance as at the end of March 2022 totals £2.531m. If required, and with Board approval, all designated funds of the Charity as described in the Reserves section above could be made available to meet the cashflow requirements of the business.
To support the long term strategic development of the NFC and the National Forest, the Charity has progressed the merger with the National Forest Charitable Trust. The close charitable objects of the two organisations, long history of collaboration, and financial benefits of combined functions mean that now is an optimum time for the merger
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to proceed. The merger was agreed in 2020‑21 with Defra’s commercial team, and extensive due diligence work has been undertaken during 2021‑ 22 with professional advice on legal, financial and governance issues. The NFC’s Audit & Risk Committee has overseen the due diligence work to ensure that risks are being mitigated and to reduce the impact on the NFC’s ability to continue as a going concern. A smooth transition has also been supported by NFCT Trustee, Penny Coates, being elected as an NFC Trustee, and NFCT Trustees, Andrew Bridge and Martin Traynor who chair its subsidiary companies, being co‑opted onto the NFC Board. The future governance will see the NFCT charity dissolve and the two subsidiary companies transfer to the NFC as the parent charity. The merger will take effect on 1 April 2022 with all NFCT assets transferring to the NFC.
COVID‑19 impacts on the Charity are now reduced for 2022‑23, but cost of living and inflationary pressures are increasing. Risk management and mitigations are being put in place to monitor the operating environment and reduce potential impacts. The Trustees are not aware of any other significant risk which may impact on the ability of the NFC to continue to operate at the current level of activity.
All of the above factors inform the opinion that it is appropriate to adopt the going concern basis for the preparation of financial statements for 2021‑22.
## Auditors and their remuneration
Statutorily appointed auditor: Comptroller and Auditor General National Audit Office, 157 – 197 Buckingham Palace Road, London SW1W 9SP
The fee for the audit of the financial statements in 2021‑22 was £31,000 (2020‑21: £24,000). Of the 2021‑22 £31,000 fee, £2,000 relates to additional work performed on the 2020‑21 audit but charged in 2021‑22. No non‑audit work was conducted by the National Audit Office during 2021‑22.
## Internal audit
Mazars LLP, 58 The Ropewalk, Nottingham NG1 5DW
## Investment Managers
Cazenove Capital, 1 London Wall Place, London EC2Y 5AU
## Solicitors
Ansons Solicitors, St Mary’s Chambers, 5‑7 Breadmarket Street, Lichfield, Staffordshire WS13 6LQ
## Pension liabilities
All the NFC staff are members of the Principal Civil Service Pension Scheme (PCSPS). Information on the pension arrangements and accounting policy applied to pension liabilities is provided in Note 1 of the financial statements. Pension arrangements are detailed in the Remuneration and Staff Report which also provides information on pension benefits to which the NFC Chief Executive qualifies. No other Trustees are members of the PCSPS.
## Losses, special payments and gifts
_(this information is subject to audit)_
There were no losses, special payments or gifts made during 2021‑22 (2020‑21: nil). No special payments that require disclosure were made during the year.
## Payment of Suppliers
The standard term of payment for supplier contracts is 30 days from receipt and agreement of a valid invoice. This is embedded in all contracts with suppliers, with any exceptions agreed as part of contractual negotiations. However, the Company aims to pay undisputed invoices within five days of approval and 84% have been paid within this timescale (2020‑21: 88%); 97% were paid within ten days (2020‑21: 98%). No claims were received during the year from suppliers for late payment of invoices under the Late Payment of Commercial Debts (Interest) Act 1998.
## Research and development
During the year £105,757 was spent on research and development (2020‑21: £10,586).
The main areas of activity were:
The Board has appointed Mazars as internal auditors who report on a quarterly basis to the Audit and Risk Committee.
## Bankers
The Co‑operative Bank, Miller Street, Manchester M60 0AL
- Squirrel impact assessment;
- Environmental Land Management Scheme (ELMS) pilot research undertaken for Defra, £68,456;
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- Biodiversity monitoring for the ’Great Big Nature Boost’ programme;
- Ongoing maintenance and support for our GIS systems; and
- Annual statistical analysis of the economic impact of tourism on the Forest area.
## Sustainability Report
The NFC’s sustainability performance is reported against a series of measures which are consistent, as far as possible, with HM Treasury sustainability reporting guidance and gives an overview of other areas where the NFC aims to make positive impacts through its operations.
The NFC operates from serviced accommodation leased from a private landlord. The data in this report therefore focuses primarily on our main direct impacts which are energy consumption (Scope 2 Energy Indirect Emissions) and official
business travel (Scope 3 Other indirect Green House Gas (GHG) Emissions). The NFC does not generate any Scope 1 emissions. Electricity is recharged by the landlord and plans are in place to upgrade to a more energy efficient heating system for our offices next financial year. Water data cannot currently be reported upon as consumption is included within the landlord’s service charge and accurate data is not available.
To enable comparisons to be made between years, the total energy emissions data has been normalised by the average number of full time equivalent (FTE) employees.
In a year when COVID‑19 restrictions have intermittently eased the report this year again does not reflect pre‑pandemic trends. We continue to see lower emissions from electricity and travel, due to staff working more flexibly and fewer journeys needed with meetings being held virtually.
## Summary of key sustainability data
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2021-22 2020-21 2019-20 2018-19
Summary of Greenhouse Gas Emissions tCO2 tCO tCO tCO tCO
2 2 2 2
**----- End of picture text -----**
|Building Energy Consumption (Scope 2)|8.12|7.26|10.98|10.49|
|---|---|---|---|---|
|Official Business Travel (Scope 3)|1.79|0.80|5.22|8.43|
|Total emissions|9.91|8.06|16.20|18.92|
|Average number of staff (FTE)|30|26|22|24|
|Total energy emissions per head (FTE)|0.27|0.28|0.50|0.44|
## Energy consumption data
_(Historic tCO2 data for electricity has been updated in line with the changes to the conversion factor.)_
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Building Energy Consumption (Scope 2) Unit 2021-22 2020-21 2019-20 2018-19
**----- End of picture text -----**
|Total emissions|tCO2|8.12|7.26|10.98|10.49|
|---|---|---|---|---|---|
|Building energy consumption per head (FTE)|tCO2|0.27|0.28|0.50|0.44|
|Building energy consumption|kw/h|42,011|37,534|56,787|54,233|
|Energy consumption per head (FTE)|kw/h|1,400|1,444|2,581|2,260|
|Total energy expenditure|£|8,033|8,152|10,561|8,779|
|Expenditure per head (FTE)|£|268|314|484|366|
|Average number of staff (FTE)||30|26|22|24|
## Travelling
COVID‑19 continued to impact on travel emissions in 2021‑22. As COVID‑19 restrictions eased travel has increased slightly, although staff have now moved to hybrid working arrangements, with meetings continuing to be held virtually unless absolutely necessary and considered to be beneficial. Essential business travel mainly relates to inspections of management and planting works across the Forest. We continue to monitor hybrid working arrangements but anticipate that they will continue; this will also reduce emissions from commuting to the office.
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Official Business Travel (Scope 3) Unit 2021-22 2020-21 2019-20 2018-19
**----- End of picture text -----**
|Total emissions|tCO2|1.79|0.8|5.22|8.43|
|---|---|---|---|---|---|
|Staff mileage (inc Chief Executive)|miles|7,462|3,030|15,027|22,478|
|Average number of staff (FTE)||30|26|22|24|
|Staff mileage per head|miles|249|117|683|937|
|Staff Air travel|miles|—|—|—|—|
|Trustees’ mileage|miles|108|—|3,590|6,232|
|Total miles travelled|miles|7,570|3,030|18,617|28,710|
|Total Business travel costs|£|5,491|1,800|24,107|22,381|
_Travel data includes official business travel by all staff and Trustees. Mileage relates to travel in staff/Trustees’ own vehicles. Total business travel costs includes car mileage and rail._
## Waste
The majority of waste generated at our office is paper and cardboard, all of which is recycled.
All other recyclable materials are recycled via the local authority recycling services; no data is currently available for this, nor for the minimal amount of waste that is not recyclable. IT equipment is recycled for refurbishment and re‑use. Staff take home any food waste for composting.
## Procurement
We recognise our responsibility to carry out our procurement activities in an environmentally and socially responsible way. Wherever possible, we ensure that environmental and social considerations are built into our procurement processes. Information on environmental policies of potential suppliers is requested and these are reviewed, where appropriate, as part of the tendering procedure when seeking to award contracts or place orders for goods and services. We continue to develop our procedures to ensure that sustainability is fully integrated throughout the procurement process.
## Tree guards
Within the National Forest we have planted over 9 million trees. To help protect the trees from browsing mammals, we have usually planted the trees within fenced areas. We have on occasions had to use tree guards, and these have varied in size and type, from plastic to biodegradable guards. During the last planting season, we stopped using plastic tree guards on our estate and our plastic tree guard recycling scheme, introduced in 2017, it is now embedded in our woodland management practices. Guards are recycled in the UK and are used to make recycled products, such as benches. Our grants now also have provision for collection and recycling
of tree guards and by 2023‑24 our aim is to have removed plastic guards completely from our grant offers by incentivising the use of sustainable biodegradable tree guards.
## Sustainable biomass chip
We continue to support the production of sustainable biomass chip through our Woodland Economy Grant scheme. The biomass chip can be a more environmentally friendly energy source when compared to oil, gas or electricity, as it is produced from sustainably managed woodland that also provides habitat for wildlife, areas for access and recreation, and supports the local economy. The production of biomass chip is proving popular with landowners. Our continued aim is to have a significant positive carbon impact in the National Forest in terms of carbon sequestered each year in growing well managed woodlands and planting new woodlands to soak up carbon dioxide.
## Ready to Burn Firewood Scheme
The National Forest promotes the DEFRA Ready to Burn which allows a firewood producer to demonstrate that their firewood has a moisture content of 20% or less. A key element of Ready to Burn’s ambition is to assist small firewood operators to become part of this scheme to enable them to abide by the legislation. These firewood operators could be local woodland owners producing firewood from their own timber production, purchasing roundwood and processing it, or purchasing firewood and retailing it. We promote to help local businesses to provide a sustainable fuel.
## Biochar
We are undertaking a biochar trial with Nottingham University to determine whether there is a benefit to growing trees through adding biochar to the soils, with newly planted trees. Biochar is created
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by burning biomass in low‑oxygen conditions producing the carbon‑rich substance. If the trials are successful, they could act as a catalyst for use of the product across our estate which could help to act as an additional carbon store.
## Personal data related incidents
No personal data related incidents occurred during the year which needed to be reported to the Information Commissioner’s office.
## Post year end events and developments
Post year end event was the merger with the National Forest Charitable Trust on 1 April 2022 please refer to Note 25. There are no other post year end events or developments which require to be reported on.
The strategic report was approved by the Trustees, on 23 November 2022 and signed on their behalf by:
Lord Duncan of Springbank PhD FGS Chair of the Board of Trustees 23 November 2022
## John Everitt FRSA
Chief Executive/Accounting Officer/Trustee 23 November 2022
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## **Statement of Trustees’ and Accounting Officer’s Responsibilities**
The Board of Trustees of the National Forest Company is required to prepare a statement of accounts for each financial year in accordance with applicable law and regulations.
Section 394 of the Companies Act 2006 requires the Trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. The Secretary of State for Environment, Food and Rural Affairs has directed the National Forest Company to prepare for each financial year a statement of accounts in the form and on the basis set out in the Accounts Direction.
The accounts are prepared on an accruals basis and must give a true and fair view of the state of affairs of the Company and of its incoming resources, application of resources and cash flows for the financial year.
In preparing the financial statements, the Trustees are required to comply with the requirements of FRS 102 and the FRS 102 Statement of Recommended Practice (SoRP) Accounting by Charities issued by the Charity Commission with regard to any additional requirements arising from the Government Financial Reporting Manual and in particular to:
- observe the Accounts Direction issued by the Department for Environment, Food and Rural Affairs, including the relevant accounting and disclosure requirements, and apply suitable accounting policies on a consistent basis;
- make judgements and estimates on a reasonable basis;
- state whether applicable accounting standards have been followed, and disclose and explain any material departures in the financial statements; and
- prepare the financial statements on a going concern basis.
the Accounting Officer is answerable, for keeping proper records and for safeguarding the National Forest Company’s assets, are set out in Managing Public Money published by the HM Treasury.
The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website.
Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
In so far as the Trustees are aware:
- there is no relevant audit information of which the Company’s auditors are unaware;
- the Trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information; and
- the annual report and accounts as a whole are fair, balanced and understandable and that the Accounting Officer takes personal responsibility for the annual report and accounts and the judgements required for determining that it
- is fair, balanced and understandable.
Lord Duncan of Springbank PhD FGS Chair of the Board of Trustees 23 November 2022
## John Everitt FRSA
Chief Executive/Accounting Officer/Trustee 23 November 2022
The Principal Accounting Officer for the Department for Environment, Food and Rural Affairs has designated the Chief Executive of the National Forest Company as the Company’s Accounting Officer. The responsibilities of an Accounting Officer, including responsibility for the propriety and regularity of the public finances for which
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## **Governance Statement**
## Overview
The National Forest Company (NFC) is a charitable company (limited by guarantee). As a charity, the NFC exists to carry out its charitable purposes. As a Non‑Profit Institution within the Public Sector specifically Central Government, the NFC operates at ‘arm’s length’ from its sponsor department, the Department for Environment, Food and Rural Affairs (Defra).
The NFC Board is responsible for leading and directing the Charity and for determining strategy and guiding operational activity. The terms of a Framework Document agreed between Defra and the NFC sets out the governance arrangements to be adhered to, clarifying the roles and responsibilities of Defra, including those of the Secretary of State as a Member of the NFC, and of the NFC itself. Its provisions enable Defra to monitor performance and delivery in relation to grants given to the NFC and describes the arrangements that exist to safeguard propriety and regularity.
The NFC seeks to comply with good practice as issued by the Charity Commission. It also complies with the Cabinet Office ‘Corporate Governance in Central Government Departments: Code of Good Practice’ as it applies to the NFC and operations are underpinned by the seven core principles (‘the Nolan Principles’) of good governance for public services. This Governance Statement provides an evaluation of the effectiveness of the NFC’s governance, risk and internal control arrangements.
## Governance Arrangements
## _Members and Board of Trustees_
In accordance with the Articles of Association, the NFC Chair and Secretary of State for Environment, Food and Rural Affairs and two further independent individuals are Members of the Charity. The Secretary of State is in a minority when voting on the NFC business and therefore cannot exercise a controlling influence.
The Board of Trustees was established in March 2016. The Board determines the strategy of the organisation and ensures that appropriate policies and procedures are in place to fulfil its obligations as to the use of public funds.
The Chair and six Trustees, excluding the Chief Executive, are not remunerated but are entitled to be reimbursed out of pocket expenses necessarily incurred in fulfilling their duties. The NFC Chief
Executive is a Trustee and his remuneration is detailed in the Remuneration and Staff Report.
All Trustees provide declarations of interest and these are recorded in a Register of Interests which is available on the National Forest Company website nationalforest.org/about/who‑we‑are. The Board meets four times a year, and additionally as necessary, to consider business performance, organisational structure and strategy.
The membership of the Board of Trustees in 2021‑22 excluding the Chief Executive was as follows:
Lord Duncan of Springbank (Chair) Tony Ballance Jack Buckner Alison Field Paddy Harrop Anne Jenkins Mike Kapur
The recruitment of Trustees is conducted through fair and open competition in accordance with the Governance Code on Public Appointments. The induction programme for Trustees includes: the roles and responsibilities of a Trustee; governance arrangements; vision and strategy for the National Forest, including familiarisation with the Corporate Plan, and meetings and presentations from staff on their operational areas. Handover meetings between new and retiring Trustees are also arranged where appropriate.
Standard agenda items for Board meetings include the Chief Executive’s quarterly report and strategic summary reporting on progress against operational targets and giving headline commentary on activity analysed between successes, challenges, risks (including a COVID‑19 resilience plan) and opportunities. A finance report, declarations of interest, a Heart of the Forest Vision update, income generation and campaign performance report and oversight of delivery of Defra’s Nature for Climate Fund (NFCF) programme are also standing items. Minutes from sub‑committees of the Board and working groups are also included within papers sent to Trustees.
During 2021‑22 the Board considered a range of matters including:
- reviewing the annual programme of work and budget;
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- continued development of a long‑term Vision and Strategy for the National Forest, with particular focus on the Heart of the Forest vision;
- risk management, including consideration of strategic risks relating to the delivery of the NFC’s objectives, going concern, COVID‑19 impacts and financial sustainability;
- overseeing the proposed convergence of the National Forest Company (NFC) and National Forest Charitable Trust (NFCT), including due diligence, feasibility work, professional and legal advice;
- the approach being taken to develop a Heart of the Forest Masterplan, particularly in light of the proposed convergence;
- approving amendments to the NFC’s Framework Document ahead of submission to Defra and Cabinet Office;
- agreeing to continue planning to hold a 2021 Timber Festival event and the adoption of a new arrangements for future years;
- receiving the annual report of the Audit & Risk Committee, together with approving its revised Terms of Reference;
- agreeing to the revision of NFC’s strategic approach to forest creation mechanisms to facilitate increased delivery;
- agreeing the revised land acquisition approval process;
- approving the 2021 Changing Landscape Scheme applications, as recommended by the Land and Forestry Working Group;
- consideration of a five‑year Management Agreement with Forestry England in relation to the establishment and management of the NFC’s Minorca site;
- considering the Income Generation Strategy Framework and Annual Income Generation Campaign Plan and reviewing performance;
- considering an update on performance against key priority areas arising from the NFC’s Equality, Diversity and Inclusion (EDI) Statement;
- plans for the COVID‑19 Memorial Woodland being established in partnership with the National Memorial Arboretum;
- reviewing the annual Safety, Health and Wellbeing (SHaW) report, containing the SHaW Policy; and
- considering the NFC’s involvement in the Queen’s Green Canopy initiative.
The Board undertakes annual reviews of its governance and Board effectiveness.
The format of the review is based on the Charity Governance Code which sets the principles and recommended practice for good governance and drawing upon the Charity Commission’s guidance using the recognised hallmarks of an effective charity, ie organisational purpose; leadership; integrity; decision making, risk and control; board effectiveness; diversity and openness and accountability.
The review undertaken again demonstrated that the NFC’s governance processes and practice provide a high level of assurance against the Charity Commission’s key principles and therefore provided a strong basis for assessing Board performance as ‘effective’. There continues to be consensus amongst Trustees, and between staff and Trustees, on areas of strength, compliance and weakness. The review also assessed the quality of reports and papers to the Board which were considered to be of a good standard, enabling the Board to make effective decisions.
Areas for improvement and further refinement included:
- Benchmarking – improved benchmarking to be explored as part of the work with the Audit & Risk Committee on value for money and performance indicators; and
- Equality, Diversity and Inclusion (EDI) – to continue the working group activity; exploring training opportunities for staff, Board and volunteers, and consideration of EDI in relation to staff, volunteers and visitors.
## _Board Committees and Working Groups_
The Board of Trustees is supported by various committees and working groups which have key functions to discharge. Each is chaired by a Trustee and has additional Trustee representation. Appropriate staff are also involved.
The Committees and Working Groups are:
- Audit & Risk Committee (ARC) – covering issues on finance, investments, risk, health and safety, governance, policy and HR;
- Remuneration Committee – covering issues on remuneration of the Chief Executive and senior staff;
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- Land & Forestry Working Group – covering issues on land policy, forest creation, forest management and economy, NFC owned sites, access creation and biodiversity;
- Development Working Group – covering issues on income generation, marketing and communications, branding and project development; and
- Tourism, Recreation & Communities Working Group – covering issues on tourism and facilities, recreation and access, and communities, health, education, arts and training.
All committees and working groups have written terms of reference. Membership of the Board, its committees and working groups are provided on page 13.
## _Review of Effectiveness of Working Groups_
The membership and remit of Committees and Working Groups has been considered by the Board in light of the proposed merger with the National Forest Charitable Trust, including representation on the boards of the subsidiary companies which are part of the transfer. In line with good practice, ARC did undertake a review of its own effectiveness which is reported upon below.
## _Audit & Risk Committee (ARC)_
The role of ARC is to provide assurance and recommendations to the Board on the effectiveness of its governance, financial management, internal control and risk management systems. ARC also monitors the work of the external audit and the effectiveness of the internal audit service. Minutes of meetings are circulated to all Trustees and oral reports given to the Board on business conducted. The Committee also presents an annual report on its activities to the Board.
ARC comprises three Trustees with the Chief Executive attending in his capacity as Accounting Officer. Mike Kapur is Chair of ARC.
ARC met four times during 2021‑22. Its work included consideration of the financial statements for 2020‑21 and the Audit Completion Report issued by the external auditor prior to the accounts being certified by the Comptroller & Auditor General (C&AG) with an unqualified audit opinion; receiving the external auditor’s Audit Planning Report for 2021‑22; considering reports issued by internal audit; scrutinising finance reports, including income generation, prior to them being presented to the Board; reviewing accounting policies; safety, health and wellbeing; fulfilling its responsibilities in respect of risk management (see below), and
oversight of investments and performance of the appointed fund manager.
During the year, the Committee sought assurances from management that recommendations from the prior year’s audit were being implemented.
These centred around making improvements to the process, inputs, judgements and documentation particularly around asset impairments to support conclusions.
Other business conducted by ARC during the year included:
- review of strategic and standing risks, including a going concern assessment, together with a resilience plan focusing specifically on risks associated with COVID‑19;
- oversight of the due diligence undertaken as part of the NFC’s convergence with the National Forest Charitable Trust;
- consideration of the finances and risks relating to the Nature for Climate Fund programme, together with an assessment of the adequacy of oversight and controls;
- oversight of the 2021 Timber Festival event and mitigations in place;
- agreeing changes to the NFC’s Framework document;
- conducting an annual review of the NFC’s Scheme of Delegations;
- review of the NFC’s VAT arrangements; and
- review of the Safety, Health and Wellbeing policy and annual report to the Board.
During the year ARC conducted its annual review of its effectiveness, utilising the National Audit Office’s checklist, based on HM Treasury’s Audit Committee Handbook. The conclusion was that the Committee continues to operate effectively and there were no areas of concern.
## _Remuneration Committee_
The Remuneration Committee supports the Board in discharging its responsibilities for remuneration issues. Membership of the Committee comprises three Trustees including the Chairs of both the Board and ARC. The Committee provides the Board with recommendations on the Chief Executive’s remuneration and benefits, and advises the Chief Executive on the pay and benefits of other senior staff.
National Forest Company – Annual Report and Accounts 2021-22
23
## _Land & Forestry Working Group_
The Land & Forestry Working Group meets four times a year and is chaired by an NFC Trustee. Membership includes the Charity’s retained land agent. Its primary function is to support and provide strategic oversight of the land and forestry aspects of the Charity’s work.
In 2021‑22 the Group’s work included:
- monitoring progress against targets for forest creation and woodland management;
- reviewing the effectiveness of the various schemes operated by the NFC and an assessment of risks/mitigations;
- overseeing NFC’s landholdings and acquisitions;
- introduction of a Pest and Diseases Policy;
- leading delivery of Defra’s Nature for Climate Fund (NFCF) programme;
- leading on the Heart of the Forest masterplanning;
- consideration of the National Forest Charitable Trust’s (NFCT) land and assets in advance of convergence with the NFC; and
- developing an approvals process for land acquisitions to sit alongside the Land Policy.
## _Development Working Group_
The Development Working Group met four times during the year with meetings being attended by one Trustee, being the designated chair. Membership includes two external funding advisors. The primary function of the Group is to support the development functions and provide strategic overview across income generation, project development, marketing and communications. In 2021‑22 the Group’s work included:
- development and monitoring of the income generation strategy and campaign;
- oversight of the projects and product development pipeline including development of a regular supporter product;
- evaluation of the 2021 ‘National Forest Trek’, a long‑distance challenge walk delivered in partnership with the National Memorial Arboretum (NMA) and the Defence and Medical Rehabilitation Centre Benevolent Fund (DMRC) and oversight of the planning for the 2022 event;
- stewarding the RHS Chelsea partnership with Meta, which would see the garden rehomed to Conkers;
- working in partnership with the NMA to facilitate a COVID‑19 memorial woodland site in their grounds;
- oversight of the development of the Brand Framework; and
- assessment and review of the return on investment of the income generation campaign.
_Tourism, Recreation & Communities Working Group_ The Tourism, Recreation & Communities Working Group meets four times per year and is attended by two Trustees, one of whom acts as chair. The primary role of the Group is to provide strategic overview and support across the tourism, recreation, arts and community development functions. In 2021‑22, the Group’s work included:
- leading on the Sustainable Tourism Accommodation Guide, Accelerator Programme and piloting a restricted call of sustainable tourism grants;
- oversight and scrutiny of outcomes and risk associated with the delivery of the National Forest Festival ‘Timber’;
- oversight of restricted projects and funding bids supporting the NFC tourism, recreation, arts and community development strategies;
- developing the NFC’s approach to Community Woodland Volunteering;
- contributing to the Heart of the Forest Masterplan Vision;
- conducting a National Forest Cultural Sector audit;
- facilitating involvement with The Queen’s Green Canopy (QGC) project within the Forest in partnership with the Rural Community Councils; and
- oversight of the Forest Society projects, eg GreenSpring, Creating Working Woodlands, Creating a Forest for Learning, Forest Foxes, and the Charnwood Landscape Partnership scheme.
- conducting a tree planting product review;
National Forest Company – Annual Report and Accounts 2021-22
24
Attendance record of Trustees at meetings of the Board and its committees and working groups
|Board &
Committee
[Number of
meetings in
2021/22]|Main
Board
[4]|Audit
& Risk
Committee
[4]|Remuneration
Committee
[1]
Land &
Forestry
Working
Group
[4]
Development
Working
Group
[4]|Tourism,
Recreation &
Communities
Working
Group
[4]|
|---|---|---|---|---|
|Trustee|||Attendance||
|Lord Duncan of|||||
|Springbank|3/4*||1/1||
|John Everitt**|4/4||||
|Tony Ballance|4/4|4/4|1/1*||
|Jack Buckner|3/4(1)||3/4*|4/4|
|Alison Field|4/4||4/4||
|Paddy Harrop|4/4|4/4|4/4*||
|Anne Jenkins|4/4|||4/4*|
|Mike Kapur|4/4|4/4*|1/1||
* Denotes Chair.
** John Everitt attends the Audit & Risk Committee meetings and Remuneration Committee meetings in his capacity as Chief Executive and Accounting Officer.
(1) Non attendance related to unforeseen technical issues, rather than availability.
## Strategy and planning
The Board is responsible for determining the strategic direction of the organisation. It approved the Strategy for the Forest for the period 2014‑2024 which sets out the key objectives and indicators against which progress will be measured over the ten‑year period.
During the year, the Board considered the long‑term vision and strategy for the National Forest and the NFC. Further work was carried out to produce the National Forest brand framework and draft brand toolkit to further define the vision.
The 2020‑23 Corporate Plan, as approved by the Board, gives direction to strategic priorities for the Forest and the NFC and a clear framework for measuring success and identifying potential issues. It also provides the basis for annual work programmes and budgets. The Plan divides into three main operational themes centred around the Forest environment, society and economy. Development themes of building the brand and securing resources for the Forest, and corporate services themes relating to effective governance and management are also included. The NFC’s activity during 2021‑22 was guided by the objectives and targets as detailed in the Plan and progress reports were given to the Board at each quarterly meeting.
Whilst the NFC operates at arm’s length from Defra, the Charity in its business plan needs to demonstrate how it uses grant funding from Defra to contribute to the Department’s own business plan priorities and wider strategic objectives.
Defra’s 25 Year Environment Plan produced in 2018 and Single Departmental Plan recognise the valuable role that forests and woodlands play in protecting and enhancing natural capital, including commitments to the public forest estate, national targets and community forestry. The Nature for Climate Fund and England Trees Action Plan developed in 2020‑21 provide dedicated resources and greater policy direction to this agenda, and the NFC is represented on strategic and operational groups to contribute to the delivery of targets.
These strategic initiatives include the NFC’s contribution to national targets and manifesto commitments, specifically in relation to forest creation, tree planting and woodland management.
In 2022‑23 the NFC’s plans will include commissioning work on the baseline sustainability figures for the NFC and setting out an association reduction programme; and also commissioning work on renewables generation for our most significant energy use asset.
National Forest Company – Annual Report and Accounts 2021-22
25
## Internal controls and the work of internal audit
The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to identify and prioritise the risks to the achievement of the Charity’s policies and objectives, to evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically.
The programme of internal audit work undertaken by Mazars LLP during 2021‑22, as approved by the Audit & Risk Committee contained a balance of compliance and advisory work:
- key financial controls;
- the National Forest Trek challenge walk, and
- benefits realisation in relation to land acquisition (advisory).
The key financial controls audit covered control account reconciliation, payments and supplier management; no issues were noted. The National Forest Trek audit was rated as ‘adequate’; three recommendations, centred around improvements to project planning and budgeting, were accepted by management.
At the end of the year a total of 15 recommendations were brought forward to follow up (three of which were outstanding recommendations from 2020‑21). Of the 15, eight recommendations had been implemented and seven were in progress.
The work undertaken and conclusions drawn informed the opinion expressed in the Annual Internal Audit Report for 2021‑22 that the NFC’s framework of governance, risk management and control is moderate in its overall adequacy and effectiveness. Certain weaknesses and exceptions were highlighted but none were considered fundamental.
There were no identified instances of fraud during the year.
## Information management
The NFC takes the management of the information it holds very seriously and is not aware of any personal data losses in 2021‑22 that would require notification to the Information Commissioner’s Office.
All staff sign copies of the Company’s policies relating to privacy and data handling and are mandated to undertake, and periodically repeat, the Civil Service Learning ‘Protecting Information’ course. All staff are engaged in work to further develop and embed protocols and good practice on the Customer Relationship Management database and staff are regularly reminded of the importance of following data handling procedures with regular refresher sessions and further training where necessary.
## Safety, Health and Wellbeing
The NFC aims to ensure that all staff and volunteers remain safe and well and that the NFC woodlands are safe, enjoyable places to visit.
The NFC is committed to the Forest Industry Safety Accord and regularly reviews Safety, Health and Wellbeing policy and practices. Regular inspections are carried out at the NFC sites throughout the year.
Staff absence due to sickness equated to an average of 2 days per employee during the year (2020‑21: 1 day).
## Whistleblowing
The NFC has a Whistleblowing Policy and procedure with which all staff are familiar. There were no instances of whistleblowing in 2021‑22, as was the case in 2020‑21. The Policy includes reference to the NFC’s Senior Independent Director as a contact and the requirement to report any serious cases to the Charity Commission. Staff are reminded of the Whistleblowing Policy and procedures at team meetings and through periodic updates, to ensure an open and accountable culture.
## Risk Management
The NFC Board is responsible for determining the NFC’s approach to risk, agreeing the Risk Policy, setting the culture of risk management and for monitoring the management of the highest scored risks as detailed in the Risk Register. Board committees and working groups are responsible for overseeing the management of risks in their area of business and ensuring that the most effective plans are drawn up and implemented to mitigate them.
This responsibility has been incorporated into their terms of reference.
National Forest Company – Annual Report and Accounts 2021-22
26
The ARC has responsibility for reviewing the risk management process and the full draft Risk Register before the highest scored risks are presented to the Board. The Committee is responsible for overseeing and reviewing the effectiveness of the systems of internal control and corporate governance within the Company with its assessment being informed by senior management and the work of the appointed auditors. Risk management features on the agenda for all ARC meetings.
The role of staff and the Senior Leadership Team (SLT) includes: identifying and evaluating significant risks faced by the NFC to be considered initially by ARC and subsequently the Board; implementing policies and associated action plans, and providing information to the committees and working groups on the status of risks and controls.
SLT is also responsible for producing the annual draft risk register. The register divides between the more strategic risks focusing on the key priorities and outcomes for the three‑year Corporate Plan and is formally reviewed by ARC and the Board every six months. Responsibility for the more operational risks fall to senior management and working groups and are reported on in the Chief Executive’s quarterly report to the Board which focuses on risks relating to the achievement of in‑year targets.
In 2021‑22 the key strategic risks relate to the NFC’s ability to scale up forest creation targets, meeting Nature for Climate Fund commitments, and taking advantage of carbon related tree planting opportunities.
Risks in relation to income generation and marketing continue to feature as significant risks on the register. However, these were mitigated by a higher profile for the National Forest, strong brand messaging and effective social media coverage, which once again resulted in a successful income generation campaign. Work continues on the development of sustainable income streams through a regular supporter product to be launched in 2022‑23. The NFC’s investments with Cazenove’s Charity Responsible Multi‑Asset Fund, in line with the NFC’s ethical investment policy, has no exposure to Ukraine or Russia.
The NFC’s key strategic risks continued to be exacerbated by the impact of COVID‑19. During the year, the Board continued to monitor a specific assessment of risks and implications, as well as mitigation measures. Details are provided in the Trustees’ Report.
The NFC received no ministerial directions during the year.
## Performance management
As Chief Executive, I have overall responsibility for the achievement of corporate objectives as detailed in the Corporate Plan. However, responsibility for delivery of many of these is delegated to other staff in the organisation.
Responsibilities and objectives are detailed in annual job plans for each employee and performance against these is assessed through the staff review system. This includes a mid‑year and end of the year assessment of how the individual has performed which determines any entitlement to a performance related bonus. The job plans also detail training and development needs identified to equip the individual to perform effectively.
The National Forest is being created for public benefit and the engagement and views of members of the public are welcomed. The Company has established procedures and arrangements for dealing with complaints and requests made under the Freedom of Information Act. During the year ended 31 March 2022, 12 complaints were received (compared with nine in 2020‑21). The complaints mostly related to third party sites and all were responded to within the specified timescale and satisfactorily resolved.
## Conclusion
As the designated Accounting Officer for the NFC, I have responsibility for the management and control of the resources used within the organisation and for discharging the responsibilities assigned to me in Managing Public Money.
I confirm that no significant issues in relation to governance, risk, performance or controls have arisen which need to be reported on in this Governance Statement.
John Everitt FRSA Chief Executive/Accounting Officer 23 November 2022
The NFC did not receive any funds via COVID‑19 support schemes and did not furlough any staff.
National Forest Company – Annual Report and Accounts 2021-22
27
## **Remuneration and Staff Report**
## (a) Remuneration Report
## Remuneration Policy
The Audit & Risk Committee’s (ARC) responsibilities include advising the Board on strategic HR, including pay and reward policy, whilst the Remuneration Committee specifically advises the Board on the remuneration and benefits attached to the Chief Executive Officer (CEO).
The Remuneration Committee also advises the CEO on pay and grading considerations relating to other senior roles.
The Remuneration Committee meets at least annually and comprises three Trustees, including the Chairs of the Board and ARC. The Committee members are identified on page 13.
## Trustees’ remuneration
Trustees, other than the Chief Executive who is remunerated in his capacity as Chief Executive, do not receive any remuneration for their services. In accordance with the NFC’s Articles of Association, all Trustees are entitled to the reimbursement of reasonable travel and subsistence expenses necessarily incurred in fulfilling their duties. Total Trustee expenses were £1,131.
## Remuneration of the Chief Executive
## _(this information is subject to audit):_
The Chief Executive is the only executive Trustee of the NFC and the only Trustee who is a member of the Principal Civil Service Pension Scheme (PCSPS).
John Everitt has been the NFC’s Chief Executive since 5 January 2015. The Principal Accounting Officer for Defra has conferred Accounting Officer status on him. The salary for the post aligns most closely to the range for Senior Civil Service pay band 1.
The salary payable to the Chief Executive is reviewed on 1 April each year. In addition to salary, the Chief Executive is entitled to an annual non‑consolidated, non‑pensionable bonus of up to 10% of annual salary. The bonus payable is based on the performance level attained and is made as part of the appraisal process operating within the Company. The bonus relates to performance in the year it is reported.
The level of bonus payable to the Chief Executive was determined by the Chair in consultation with members of the Remuneration Committee.
Emoluments of the Chief Executive (this information is subject to audit):
|Name|Start date
5 January 2015
figure of remuneration
Salary
(£’000)
Bonus payments
(£’000)
Benefits in kind
(to nearest £100)
Pension benefits
(to nearest
£1,000)1
Total
(£’000)|
|---|---|
|John Everitt
Single total
Official||
||2021‑22
2020‑21
2021‑22
2020‑21
2021‑22
2020‑21
2021‑22
2020‑21
2021‑22
2020‑21|
|John Everitt|75 – 80
75 – 80
5 – 10
5 – 10
0
0
30
30
110 – 115
110 – 115|
> 1 The value of pension benefits accrued during the year is calculated as (the real increase in pension multiplied by 20) plus (the real increase in any lump sum) less (the contributions made by the individual). The real increases exclude increases due to inflation or any increase or decreases due to a transfer of pension rights.
National Forest Company – Annual Report and Accounts 2021-22
28
## Civil Service Pensions
Pension benefits are provided through the Civil Service pension arrangements. From 1 April 2015, a new pension scheme for civil servants was introduced – the Civil Servants and Others Pension Scheme or alpha, which provides benefits on a career average basis with a normal pension age equal to the member’s State Pension Age (or 65 if higher). From that date, all newly appointed civil servants and the majority of those already in service joined alpha. Prior to that date, civil servants participated in the Principal Civil Service Pension Scheme (PCSPS). The PCSPS has four sections: three providing benefits on a final salary basis (classic, premium or classic plus) with a normal pension age of 60; and one providing benefits on a whole career basis (nuvos) with a normal pension age of 65.
These statutory arrangements are unfunded with the cost of benefits met by monies voted by Parliament each year. Pensions payable under classic, premium, classic plus, nuvos and alpha are increased annually in line with Pensions Increase legislation. Existing members of the PCSPS who were within 10 years of their normal pension age on 1 April 2012 remained in the PCSPS after 1 April 2015. Those who were between 10 years and 13 years and 5 months from their normal pension age on 1 April 2012 switched into alpha sometime between 1 June 2015 and 1 February 2022. Because the Government plans to remove discrimination identified by the courts in the way that the 2015 pension reforms were introduced for some members, it is expected that, in due course, eligible members with relevant service between 1 April 2015 and 31 March 2022 may be entitled to different pension benefits in relation to that period (and this may affect the Cash Equivalent Transfer Values shown in this report – see below.) All members who switch to alpha have their PCSPS benefits ‘banked’, with those with earlier benefits in one of the final salary sections of the PCSPS having those benefits based on their final salary when they leave alpha. (The pension figures quoted for officials show pension earned in PCSPS or alpha – as appropriate. Where the official has benefits in both the PCSPS and alpha the figure quoted is the combined value of their benefits in the two schemes.) Members joining from October 2002 may opt for either the appropriate defined benefit arrangement or a defined contribution (money purchase) pension with an employer contribution (partnership pension account).
Employee contributions are salary‑related and range between 4.6% and 8.05% for members of classic, premium, classic plus, nuvos and alpha. Benefits in classic accrue at the rate of 1/80th of
final pensionable earnings for each year of service. In addition, a lump sum equivalent to three years initial pension is payable on retirement. For premium, benefits accrue at the rate of 1/60th of final pensionable earnings for each year of service. Unlike classic, there is no automatic lump sum. Classic plus is essentially a hybrid with benefits for service before 1 October 2002 calculated broadly as per classic and benefits for service from October 2002 worked out as in premium. In nuvos a member builds up a pension based on their pensionable earnings during their period of scheme membership. At the end of the scheme year (31 March) the member’s earned pension account is credited with 2.3% of their pensionable earnings in that scheme year and the accrued pension is uprated in line with Pensions Increase legislation. Benefits in alpha build up in a similar way to nuvos, except that the accrual rate is 2.32%. In all cases, members may opt to give up (commute) pension for a lump sum up to the limits set by the Finance Act 2004.
The partnership pension account is an occupational defined contribution pension arrangement which is part of the Legal & General Mastertrust. The employer makes a basic contribution of between 8% and 14.75% (depending on the age of the member) the employee does not have to contribute, but where they do make contributions, the employer will match these up to a limit of 3% of pensionable salary (in addition to the employer’s basic contribution). Employers also contribute a further 0.5% of pensionable salary to cover the cost of centrally provided risk benefit cover (death in service and ill health retirement). The NFC has not, to date, made any contributions to a partnership pension account.
The accrued pension quoted is the pension the member is entitled to receive when they reach pension age, or immediately on ceasing to be an active member of the scheme if they are already at or over pension age. Pension age is 60 for members of classic, premium and classic plus, 65 for members of nuvos, and the higher of 65 or State Pension Age for members of alpha. (The pension figures quoted for officials show pension earned in PCSPS or alpha – as appropriate. Where the official has benefits in both the PCSPS and alpha the figure quoted is the combined value of their benefits in the two schemes, but note that part of that pension may be payable from different ages.)
Further details about the Civil Service pension arrangements can be found at the website civilservicepensionscheme.org.uk
National Forest Company – Annual Report and Accounts 2021-22
29
## Benefits to which the Chief Executive qualifies under the PCSPS
_(this information is subject to audit)_
|Official|Accrued pension at|Real increase in pension|CETV at|CETV at|Real|
|---|---|---|---|---|---|
||pension age as at|and related lump sum|31/3/22|31/3/21|increase|
||31/3/22|at pension age|||in CETV|
||£’000|£’000|£’000|£’000|£’000|
|John Everitt|10 – 15|0 – 2.5|161|133|18|
## Cash Equivalent Transfer Values
A Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the pension scheme benefits accrued by a member at a particular point in time. The benefits valued are the member’s accrued benefits and any contingent spouse’s pension payable from the scheme. A CETV is a payment made by a pension scheme or arrangement to secure pension benefits in another pension scheme or arrangement when the member leaves a scheme and chooses to transfer the benefits accrued in their former scheme. The pension figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies.
The figures include the value of any pension benefit in another scheme or arrangement which the
member has transferred to the Civil Service pension arrangements. They also include any additional pension benefit accrued to the member as a result of their buying additional pension benefits at their own cost. CETVs are worked out in accordance with The Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 and do not take account of any actual or potential reduction to benefits resulting from Lifetime Allowance Tax which may be due when pension benefits are taken.
## Real increase in CETV
This reflects the increase in CETV that is funded by the employer. It does not include the increase in accrued pension due to inflation, contributions paid by the employee (including the value of any benefits transferred from another pension scheme or arrangement) and uses common market valuation factors for the start and end of the period.
## (b) Staff Report
## Staff employed
## Average number of persons employed:
||||||
|---|---|---|---|---|
|Average number of persons employed:||2021-22||2020-21|
|_(this information is subject to audit)_||Full time||Full time|
|||equivalent||equivalent|
||Headcount|(FTE)|Headcount|(FTE)|
|Staff (including Chief Executive)|34|30|29|26|
|During 2021‑22, all staff were employed on a|Total emoluments of directors or employees||||
|permanent basis, apart from 5 FTE, comprising|earning more than £60,000 fall within|||the|
|4.8 FTE on fixed term contracts and 0.2 FTE|following bandings:||||
|agency staff.|||||
||2022|2021|
|---|---|---|
|£80,000 – £89,999
£70,000 – £79,999
£60,000 – £69,999|1
–
2
3|1
1
–|
|||2|
The salary and related costs arising from the employment of the above is detailed in Note 8 to the accounts.
## Remuneration of staff
## _(this information is subject to audit)_
All staff below the level of Chief Executive are employed in substantive posts, subject to the completion of a satisfactory probationary period. The terms of the pay review applied to staff at Grade 6 and below within core‑Defra, on 1 July each year, are normally applied to staff employed by the NFC. In line with Government pay policy, the pay freeze was applied to NFC staff in 2021.
Total emoluments include salary and benefits in kind but exclude pension payments.
There were no exit payments in year.
All staff are members of the PCSPS.
National Forest Company – Annual Report and Accounts 2021-22
30
## Sickness absence
Staff absence due to sickness equated to an average of 2 days per employee during the year (2020‑21: 0.87 days).
Trustees Staff, including the Chief Executive Total
## Equal Opportunities
The Company is an equal opportunities employer. It is committed to a policy of non‑discrimination on grounds of gender or marital status, sexual orientation, health (including pregnancy), disability, age, religion, colour, nationality or ethnic or national origin. Staff are required to observe this policy of non‑discrimination in their dealings with members of the public and colleagues at work. All new staff are appointed on the basis of ability, qualification and suitability for the post. All staff are required to complete a diversity and inclusion course as part of a suite of mandatory training.
## Staff engagement
Various channels are used to regularly communicate with staff, including weekly updates from the Chief Executive, together with COVID‑19 updates, and fortnightly team meetings. Key documents such as the Corporate Plan, papers and minutes of meetings of the Board, Audit & Risk Committee and working groups are made available to all staff.
Team days are held regularly where everyone has the opportunity to be involved in generating new ideas, to contribute their thoughts and to engage with continuing developments and plans for all areas of our work.
## Fair pay disclosure
Remuneration of the highest paid Director and the ratio between this and the lower quartile, median and upper quartile remuneration of the NFC’s staff _(this information is subject to audit)_
Reporting bodies are required to disclose the relationship between the remuneration of the highest paid Director in their organisation and the lower quartile, median and upper quartile remuneration of the organisation’s workforce.
## Gender diversity
The gender split of Trustees and staff employed as at 31 March 2022 was as follows:
||Male|Female|Total|
|---|---|---|---|
||5
12
17|2
22
24|7
34|
||||41|
This was 2.75 times (2021: 2.69) the lower quartile remuneration of the workforce of £30,004 (2021: £30,658).
This was 2.30 times (2021: 2.28) the median remuneration of the workforce of £35,895 (2021: £36,200).
This was 2.05 times (2021: 2.04) the upper quartile remuneration of the workforce of £40,265 (2021: £40,357
Remuneration of the workforce ranged from £17k to £85k (2020‑21: £25k to £85k).
The percentage changes in the highest paid Director’s salary is nil due to a pay freeze (2021: 10%). The percentage changes in the highest paid Director’s performance pay and bonuses payable is 18% (2021: 11%).
The average percentage change in employees’ salaries is nil due to a pay freeze in 2022 (2021: 4%). The average percentage change in employees’ performance‑related pay is 11% (2021: 37%).
In 2021‑22, no employees received remuneration in excess of the highest paid Director, as was the case in 2020‑21.
Total remuneration includes full time salary equivalents and non‑consolidated performance related bonuses but excludes employer pension contributions and the cash equivalent transfer value of pensions.
John Everitt FRSA
Chief Executive/Accounting Officer 23 November 2022
The remuneration as at 31 March 2022 of the Chief Executive, who is the highest and only paid director in the NFC, was in the range of £80,000 – £85,000 (2021: £80,000 – £85,000).
National Forest Company – Annual Report and Accounts 2021-22
31
## **The Certificate and Report of the Comptroller and Auditor General to the Members of the National Forest Company and the Houses of Parliament**
## Opinion on financial statements
I certify that I have audited the financial statements of the National Forest Company (NFC) for the year ended 31 March 2022 which comprise the NFC’s:
- Balance Sheet as at 31 March 2022;
- Combined Statement of Financial Activities and Income and Expenditure Account, and the Statement of Cash Flows for the year then ended; and
- the related notes including the significant accounting policies.
The financial reporting framework that has been applied in the preparation of the NFC’s financial statements is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
In my opinion the financial statements:
- give a true and fair view of the state of the NFC’s affairs as at 31 March 2022 and its incoming resources and application of resources for the year then ended; and
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice;
- have been prepared in accordance with the requirements of the Companies Act 2006; and
- have been properly prepared in accordance with the Charities Act 2011.
## Opinion on regularity
In my opinion, in all material respects, the income and expenditure recorded in the financial statements have been applied to the purposes intended by Parliament and the financial transactions recorded in the financial statements conform to the authorities which govern them.
## Basis for opinions
I conducted my audit in accordance with International Standards on Auditing (ISAs) (UK), applicable law and Practice Note 10 _Audit of Financial Statements of Public Sector Entities in the United Kingdom_ . My responsibilities under those standards are further described in the
_Auditor’s responsibilities for the audit of the financial statements_ section of my certificate.
Those standards require me and my staff to comply with the Financial Reporting Council’s _Revised Ethical Standard 2019_ . I have also elected to apply the ethical standards relevant to listed entities. I am independent of the NFC in accordance with the ethical requirements that are relevant to my audit of the financial statements in the UK. My staff and I have fulfilled our other ethical responsibilities in accordance with these requirements.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.
## Conclusions relating to going concern
In auditing the financial statements, I have concluded that the NFC’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work I have performed, I have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the NFC’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.
My responsibilities and the responsibilities of the Trustees and Accounting Officer with respect to going concern are described in the relevant sections of this certificate.
## Other Information
The other information comprises information included in the Annual Report, but does not include the financial statements and my auditor’s certificate and report thereon. The Trustees and the Accounting Officer are responsible for the other information.
My opinion on the financial statements does not cover the other information and except to the extent otherwise explicitly stated in my certificate, I do not express any form of assurance conclusion thereon.
In connection with my audit of the financial statements, my responsibility is to read the other
National Forest Company – Annual Report and Accounts 2021-22
32
information and, in doing so, if I identify such material inconsistencies or apparent material misstatements, I am required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact.
I have nothing to report in this regard.
## Opinion on other matters
In my opinion the part of the Remuneration and Staff Report to be audited has been properly prepared in accordance with the Companies Act 2006.
In my opinion, based on the work undertaken in the course of the audit:
- the Strategic Report and the Directors’ Annual Report have been prepared in accordance with applicable legal requirements; and
- the information given in the Strategic Report and the Directors’ Annual Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
## Matters on which I report by exception
In the light of the knowledge and understanding of the NFC and its environment obtained in the course of the audit, I have not identified material misstatements in the Strategic Report or the Directors’ Annual Report.
I have nothing to report in respect of the following matters which I report to you if, in my opinion:
- adequate accounting records have not been kept or returns adequate for my audit have not been received from branches not visited by my staff; or
- the financial statements and the parts of the Remuneration and Staff Report to be audited are not in agreement with the accounting records and returns; or
- certain disclosures of director’s remuneration specified by law are not made; or
- I have not received all of the information and explanations I require for my audit;
## Responsibilities of the Trustees and Accounting Officer for the financial statements
As explained more fully in the Statement of Trustees’ and Accounting Officer’s Responsibilities, the Trustees and the Accounting Officer are responsible for:
- the preparation of the financial statements in accordance with the applicable financial reporting framework and for being satisfied that they give a true and fair view;
- internal controls as Trustees and the Accounting Officer determine are necessary to enable the preparation of financial statement to be free from material misstatement, whether due to fraud or error; and
- assessing the NFC’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 directors either intends to liquidate the entity or to cease operations, or has no realistic alternative but to do so.
## Auditor’s responsibilities for the audit of the financial statements
My responsibility is to audit, certify and report on the financial statements in accordance with applicable law and International Standards on Auditing (ISAs) (UK).
My 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 a certificate that includes my opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
## _Extent to which the audit was considered capable of detecting non‑compliance with laws and regulations, including fraud_
I design procedures in line with my responsibilities, outlined above, to detect material misstatements in respect of non‑compliance with laws and regulations, including fraud. The extent to which my procedures are capable of detecting non‑ compliance with laws and regulations, including fraud is detailed below.
National Forest Company – Annual Report and Accounts 2021-22
33
_Identifying and assessing potential risks related to non‑compliance with laws and regulations, including fraud_
In identifying and assessing risks of material misstatement in respect of non‑compliance with laws and regulations, including fraud, we considered the following:
- the nature of the sector, control environment and operational performance including the design of the NFC’s accounting policies and key performance indicators.
- Inquiring of management, the NFC’s head of internal audit and those charged with governance, including obtaining and reviewing supporting documentation relating to the NFC’s policies and procedures relating to:
- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non‑compliance;
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
- the internal controls established to mitigate risks related to fraud or non‑compliance with laws and regulations including the NFC’s controls relating to the NFC’s compliance with the Companies Act 2006, Charities Act 2011 and Managing Public Money;
- discussing among the engagement team and involving relevant specialists, including for land valuations where specialist expertise was engaged on the audit regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
As a result of these procedures, I considered the opportunities and incentives that may exist within the NFC for fraud and identified the greatest potential for fraud in the following areas: revenue recognition, posting of unusual journals, complex transactions and bias in management estimates. In common with all audits under ISAs (UK), I am also required to perform specific procedures to respond to the risk of management override of controls.
I also obtained an understanding of the NFC’s framework of authority as well as other legal and regulatory frameworks in which the NFC operates, focusing on those laws and regulations that had a direct effect on material amounts and disclosures in the financial statements or that had a fundamental effect on the operations of the NFC. The key laws and regulations I considered in this context included Companies Act 2006, Charities
Act 2011, the Statement of Recommended Practice (SORP) Accounting by Charities issued by the Charity Commission with regard to any additional requirements arising from the Government Financial Reporting Manual, Managing Public Money, employment law and tax legislation.
## _Audit response to identified risk_
As a result of performing the above, the procedures I implemented to respond to identified risks included the following:
- reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described above as having direct effect on the financial statements;
- enquiring of management and the Audit and Risk Committee concerning actual and potential litigation and claims;
- reading and reviewing minutes of meetings of those charged with governance and the Board and internal audit reports; and
- in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
I also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non‑compliance with laws and regulations throughout the audit.
A further description of my responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of my certificate.
## _Other auditor’s responsibilities_
I am required to obtain evidence sufficient to give reasonable assurance that the income and expenditure reported in the financial statements have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them.
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34
I 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 I identify during my audit.
## Report
I have no observations to make on these financial statements.
Gareth Davies
24 November 2022
Comptroller and Auditor General (Statutory Auditor)
National Audit Office 157‑197 Buckingham Palace Road Victoria London SW1W 9SP
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35
Combined Statement of Financial Activities and Income and Expenditure Account for the year ended 31 March 2022
|||Unrestricted|Restricted|2021-22|Unrestricted|Restricted|2020-21|
|---|---|---|---|---|---|---|---|
|||funds|funds|Total funds|funds|funds|Total funds|
||Note|£|£|£|£|£|£|
|Income from:||||||||
|Grant in aid|2|2,400,715|–|2,400,715|2,467,457|–|2,467,457|
|Nature for||||||||
|Climate Fund|2|–|1,894,000|1,894,000|–|2,146,007|2,146,007|
|Donations|3|584,863|21,542|606,405|460,700|20,000|480,700|
|Charitable||||||||
|activities|4|12,512|752,701|765,213|2,284|410,735|413,019|
|Other trading||||||||
|activities|5|112,702|17,500|130,202|70,430|10,000|80,430|
|Investments||45,861|–|45,861|26,806|–|26,806|
|Total||3,156,653|2,685,743|5,842,396|3,027,677|2,586,742|5,614,419|
|Expenditure on:||||||||
|Raising funds|6|(662,375)|–|(662,375)|(762,686)|(10,000)|(772,686)|
|Charitable||||||||
|activities|7|(1,969,754)|(2,532,617)|(4,502,371)|(1,758,183)|(947,425)|(2,705,608)|
|Total||(2,632,129)|(2,532,617)|(5,164,746)|(2,520,869)|(957,425)|(3,478,294)|
|Net gains/(losses)||||||||
|on investments|13|61,621|33,323|94,944|(223)|(107,403)|(107,626)|
|Net income/||||||||
|(expenditure)||586,145|186,449|772,594|506,585|1,521,914|2,028,499|
|Transfers||||||||
|between funds|18|(126,055)|126,055|–|(62,416)|62,416|–|
|Other recognised||||||||
|gains/(losses)||||||||
|Gains/(losses)||||||||
|on revaluation||||||||
|of fixed assets|12|59,500|–|59,500|17,500|–|17,500|
|Gains/(losses) on||||||||
|Foreign Currency|18|–|38,873|38,873|–|(44,520)|(44,520)|
|Net movement||||||||
|in funds||519,590|351,377|870,967|461,669|1,539,810|2,001,479|
|Reconciliation||||||||
|of funds:||||||||
|Total funds||||||||
|brought forward|18|6,759,062|2,075,390|8,834,452|6,297,393|535,580|6,832,973|
|Total funds||||||||
|carried forward|18|7,278,652|2,426,767|9,705,419|6,759,062|2,075,390|8,834,452|
National Forest Company – Annual Report and Accounts 2021-22
36
## **National Forest Company**
## Balance Sheet
as at 31 March 2022
|Note|As at
31 March
2022
£|As at
31 March
2021
£|
|---|---|---|
|Fixed assets:
Intangible assets
11
Tangible assets
12
Investment property
13
Investment
13
Total fixed assets
Current assets:
Debtors
14
Cash at bank and in hand
15
Total current assets
Liabilities:
Creditors: Amounts falling due within one year
16
Net current assets
Total assets less current liabilities
Total net assets
The funds of the Charity:
Unrestricted funds
18
Restricted income funds
18
Revaluation Reserve
18|48,512
3,229,930
3,331,000
531,539
7,140,981
621,901
2,530,527
3,152,428
(587,990)
2,564,438
2,564,438
9,705,419
7,141,902
2,426,767
136,750
9,705,419|17,551
2,441,373
3,506,850
505,015|
|||6,470,789|
|||548,658
2,149,010|
|||2,697,668|
|||(334,005)|
|||2,363,663|
|||2,363,663|
|||8,834,452|
|||6,681,812
2,075,390
77,250|
|||8,834,452|
The Notes on pages 38 to 61 form part of the accounts.
The National Forest Company is exempt under the provisions of Section 475 of the Companies Act 2006 from making the disclosure requirements under Part 16 under Section 482 (non‑profit making companies subject to public sector audit) of that Act.
The financial statements were approved by the Board of Trustees on 23 November 2022 and signed on its behalf by:
Lord Duncan of Springbank PhD FGS John Everitt FRSA Chair of the Board of Trustees Chief Executive/Accounting Officer
National Forest Company – Annual Report and Accounts 2021-22
37
## **National Forest Company**
Statement of Cash Flows for the twelve months ended 31 March 2022
|Statement of Cash Flows
for the twelve months ended 31 March 2022|||
|---|---|---|
|Note|2021-22
£|Reclassified
2020-21
£|
|Cash flows from operating activities
Net cash provided by operating activities
Cash flow from investing activities
Interest and rent from investment
SoFA
Purchase of property, plant and equipment(1)
12
Purchase of Investment Property(2)
13
Purchase of investments
13
Purchase of Intangible asset
11
Net cash provided by/(used in) investing activities
Change in cash and cash equivalents in the reporting period
Cash and cash equivalents at 1 April
15
Change in cash and cash equivalents due to
exchange rate movements
SoFA
Cash and cash equivalents at 31 March
15
a)
Reconciliation of net income/(expenditure)
to net cash flow from operating activities
Net income/(expenditure) for the reporting period (as per the
statement of financial activities)
SoFA
Adjustments for:
Impairment charges
12/13
Reversal of prior years’ impairment charges
12/13
Depreciation
12
Amortisation
11
(Gains)/losses on investments
13
(Increase)/Decrease in debtors
14
Increase/(Decrease) in creditors
16
Interest and rent from investment
SoFA
Net cash provided by/(used in) operating activities
b)
Analysis of cash and cash equivalents
Cash at bank and in hand
15
Cash and cash equivalents at 31 March|1,253,354
45,861
(47,329)
(866,580)
‑
(42,661)
(910,709)
342,645
2,149,010
38,873
2,530,527
772,594
544,000
(132,000)
17,122
11,701
(94,944)
(73,243)
253,985
(45,861)
1,253,354
2,530,527
2,530,527|2,643,097
26,806
(1,294,951)
(707,640)
(500,001)
–|
|||(2,475,786)|
|||167,311
2,026,219
(44,520)|
|||2,149,010|
|||2,028,499
250,493
(24,000)
17,641
39,086
107,626
74,039
176,519
(26,806)|
|||2,643,097
2,149,010|
|||2,149,010|
(1) Prior year figure of £2,002,591 has been reclassified to show split between Note 12 and Note 13.
(2) Prior year figure has been reclassified as per Note 13.
## c) Analysis of changes in net debt
||At start of Year
£|Cash-flows
£
Non-cash changes
£|Cash-flows
£
Non-cash changes
£|At end of year
£|
|---|---|---|---|---|
|Cash
Cash equivalents (investment)
Borrowings
Total|2,149,010
505,015
–
2,654,025|381,517
–
–
381,517|–
26,524
–
26,524|2,530,527
531,539
–|
|||||3,062,066|
National Forest Company – Annual Report and Accounts 2021-22
38
## **Notes to the Accounts**
## Note 1 to the Financial Statements
## 1.1 Statement of accounting policies
The NFC is a public benefit entity and is a company limited by guarantee and a charity registered in England and Wales. These financial statements have been prepared in compliance with FRS 102 and the FRS 102 Statement of Recommended Practice (SoRP) Accounting and Reporting by Charities. In addition, these financial statements also meet the accounting and disclosure requirements of the Companies Act 2006 and the 2021‑22 Government Financial Reporting Manual (FReM) issued by HM Treasury, where not inconsistent with the requirements of the SoRP and the Accounts Direction issued by the Secretary of State for Environment, Food and Rural Affairs.
Where the NFC has a choice of accounting policy to adopt, a judgement has been made to select the most appropriate policy to suit the particular circumstances for the purpose of giving a true and fair view. The particular policies adopted by the NFC are described below. They have been applied consistently in dealing with items which are considered material in relation to the accounts.
## 1.2 Going concern
These financial statements have been prepared on the basis of the NFC being a going concern. This judgement made by the Trustees takes into consideration the level of reserves held by the Company; and an indication from Defra that grant in aid funding for the next Comprehensive Spending Review period should remain at a similar base level to the 2021‑22 allocation. Defra has also allocated a further £2.45m per year to the NFC from the Nature for Climate Fund for the next three years, after commencing in 2020‑21. The merger between the NFC and the National Forest Charitable Trust will take effect on 1 April 2022 with all NFCT assets transferring to the NFC. The NFC’s Audit & Risk Committee has overseen the due diligence work to ensure that risks are being mitigated and to reduce the impact on the NFC’s ability to continue as a going concern.
## 1.3 Significant judgements and accounting estimates
The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amount of income and expenditure. All estimates are based on the NFC’s knowledge of current facts and
circumstances, assumptions concerning past events and forecasts of future events and actions. Actual results may differ from estimates made.
In the process of applying the NFC’s accounting policies, the following judgements, and estimations, have been made which have the most significant impact on the amounts recognised in the financial statements:
## Judgements
- Income recognition (see Note 1.5 below)
- Useful economic lives of tangible fixed assets (see Note 1.8 below)
- Useful economic lives of intangible fixed assets (see Note 1.9 below) Estimations
- Annual valuation of the NFC owned land and buildings undertaken by an independent Chartered Surveyor in accordance with the RICS Valuation Standards (see Notes 1.8 and 1.10 below).
## 1.4 Accounting convention
The accounts have been prepared on a going concern basis, on the accruals basis and under the modified historical cost convention, modified to account for the revaluation of land and buildings.
## 1.5 Income recognition
## Government grants
Grant in aid is credited to income in the year that it is received. It is regarded as unrestricted income since Defra, whilst requiring funds allocated be utilised in contributing to the delivery of departmental objectives, does not stipulate how any specific element of the grant should be spent.
Nature for Climate Fund grant is treated as restricted income and therefore recognised as per SoRP para 4.34 which covers performance‑related grants where the income is conditional on delivering certain levels or volumes of a service or supply of goods and contractual payments from Government or public authorities and other parties which fund the provision of particular goods or services.
This has been presented as a separate line in the Sofa due to the materiality of the income as per the SoRP para 4.13.
National Forest Company – Annual Report and Accounts 2021-22
39
## Income from donations
General donations are received and utilised for any of the NFC’s charitable purposes. No significant benefit is provided to the donor in return, other than the knowledge that the NFC must use the gift to further its purposes. Income from donations is unrestricted.
‘Dedicate a Grove’ and ‘Dedicate a Tree’ income are gift donations which the NFC use to support the ongoing creation and management of the National Forest. This is classed as unrestricted income as it represents a contribution to the National Forest’s creation which is intrinsically linked to other purposes of the charity such as ongoing maintenance of woodlands, habitat creation, education and is used to further the NFC’s charitable purposes including woodland creation.
The NFC receives an annual donation from Rolls‑Royce. This is a restricted donation to support South Derbyshire District Council’s (SDDC) Environmental Education Project and is paid over to SDDC as a disbursement upon receipt of a satisfactory progress report, as reflected in the agreement.
## Income from activities and generated funds
Income is accounted for on a receivable basis, net of VAT. Grant income entitlement is recognised when the NFC has met any performance or other deliverable criteria for recognition and the monetary value can be measured reliably. Where the grant is received in advance of recognition it is deferred and included in creditors until entitlement occurs. If entitlement occurs before the income has been received it is accrued to debtors. Income is allocated to restricted income when it is given by the donor or grant maker for defined purposes.
## Income from Sponsorship
Sponsorship income is recognised as income when the conditions for its receipt have been met, as per SoRP (5.39 – 5.47). Where there are conditions or specified deliverables then income received is not immediately recognised but is deferred as a liability until conditions imposed are met at which point the related income is recognised in the SoFA.
Where there are no specified deliverables under the agreement then the income is recognised in the Statement of Financial Activities (SoFA), in line with the stage of completion of the agreement term.
## 1.6 Expenditure
Expenditure is accounted for on an accruals basis and is classified under the relevant activity within the SoFA.
## 1.7 Expense allocation
Costs are allocated to the main areas of NFC activity of raising funds, forest creation, woodland management, tourism and promotion, community engagement and various restricted projects reflecting the objectives of the NFC as set out in the Directors’ Report.
Governance costs include Trustee expenses, production of the Annual Report and Accounts, audit fees and bank charges. The salary and related costs of the Chief Executive, who is also a Trustee, are now included within governance costs (45%) and support costs (55%) following the introduction of a timesheet recording system.
The salary and related costs of staff employed wholly on raising funds and the various charitable activities are allocated to those activities. Where staff are engaged on more than one of these activities, timesheets capture the percentage of each individual’s time spent on each activity.
Indirect costs have been allocated to the headings in the SoFA on the basis of full time equivalent headcount of staff employed directly on charitable activities and activities for raising funds. The exception is grants administration costs which have been allocated on a staff time basis via the timesheets.
## 1.8 Tangible fixed assets
The NFC has adopted an accounting policy of revaluing the land and buildings it owns as per SoRP provisions 10.33 to 10.36. An annual valuation is undertaken by an independent Chartered Surveyor in accordance with the RICS Valuation Standards (the ‘Red Book’). Valuations were undertaken of NFC land and buildings as at 31 March 2022 by Fisher German and Mather Jamie, Chartered Surveyors. The market approach was adopted, with the opinion of value based on the comparable evidence obtained and their experience of valuing residential property, woodland and agricultural land in the locality. The land valuations reflect the site use at the date of the valuation, ie open land, grazing land, young woodland and mature woodland. When planting takes place and there is a change of use in the land, ie tree planting, the valuation report reflects this with any impairment in value taken to the SoFA. Depending on the planting that takes place there could be material changes to the value of land over the next year. Land and buildings in the Balance Sheet are shown at the valuations provided per Note 12 and 13.
Where the valuation is higher than the purchase price paid, the excess over purchase price is
National Forest Company – Annual Report and Accounts 2021-22
40
credited to a Revaluation Reserve. Where land or buildings are revalued due to a change in market values but remain at below the purchase price, the loss on revaluation is charged to the SoFA in the year of the revaluation. Similarly, where as a result of a proposed change of use there is impairment in the value of the land or buildings, the loss on impairment is charged to the SoFA in the year of the impairment. Where in a subsequent year the value of land or buildings which has been the subject of an impairment charge increases, usually as a result of an increase in market values, and the valuation remains at below the purchase price, then the increase is charged to the SoFA as a reversal of previous years’ impairment. Changes in the value of land or buildings arising from revaluation or impairment are reflected in the balance of unrestricted funds and in the Revaluation Reserve.
Impairment and reversal of prior years’ impairment on land is charged to the SoFA through expenditure on charitable activities via forest creation activity (Note 7).
## Depreciation
Depreciation is provided on a straight‑line basis on the cost of furniture and fittings and information technology assets, to write them down to their estimated residual values over their expected useful lives. Expectations are informed by past experience and reflect anticipated usage of such assets.
by the Audit & Risk Committee (ARC), it was agreed that the existing website should be written off in full in 2022‑23 (autumn) at the end of its useful economic life because it would then be replaced by the cost of the new re‑ developed website. The website has been amortised from when it went live in September 2018, with the expense being charged to the SoFA.
## 1.10 Investments
## Investment property
The NFC has adopted an accounting policy of revaluing the land and buildings it owns as per SoRP provision 10.48. An annual valuation is undertaken by an independent Chartered Surveyor in accordance with the RICS Valuation Standards (the ‘Red Book’). Valuations were undertaken of NFC land and buildings as at 31 March 2022. The market approach was adopted, with the opinion of value based on the comparable evidence obtained and their experience of valuing residential property, woodland and agricultural land in the locality.
In the 2021‑22 financial year, three properties with a Net Book Value of £1,111,500 have been transferred and re‑classified to fixed assets due to land surrendered on Farm Business Tenancies.
Investment Property in the Balance Sheet is shown at the valuations provided per Note 13.
## Investments
Furniture and fittings and information technology assets have an expected useful life of between three and five years. No depreciation is charged in the year of acquisition of the asset but a full year is charged in the year of disposal.
## 1.9 Intangible Fixed Assets
During the year work has taken place to re‑develop the website costing £43k to generate future funding, as per Note 11 Asset under construction.
All intangible assets are measured at their historical cost at acquisition. Following the initial recognition of the website, subsequent measurement will be the website at cost less accumulated amortisation and impairment losses.
At the end of each reporting period an impairment review will be performed to determine whether the website is still fit for purpose in generating funds and achieving our expectations. Amortisation will be charged on a straight line basis over the useful economic life of the asset and the useful economic life will be reviewed at each reporting date. No amortisation was charged in the month of capitalisation (August 2018) but a full month in the year of disposal. When reviewed at 31 March 2022
Investments are measured at fair value and any gains or losses arising from the revaluation are charged to the SoFA. In 2021‑22 the gain on the Investment property was £25,000 (2020‑21: £20,000).
Within investments the NFC recognises the Cazenove Charity Responsible Multi‑Asset Fund investment of £0.532m.
## 1.11 Current assets and liabilities
Debtors are measured at their recoverable amounts and creditors at their settlement amounts when these can be measured or estimated reliably.
A de minimis threshold of £300 has been adopted when determining debtors and creditors at the end of March.
## 1.12 Cash and cash equivalents
Cash and cash equivalents include cash in hand, balances held in a Business Instant Saver account and cash balances held by the Government Banking Service. Cash equivalents include £531,539 invested with Cazenove Charity Responsible Multi‑Asset Fund.
National Forest Company – Annual Report and Accounts 2021-22
41
## 1.13 Leases
The NFC has no finance leases.
Rentals under operating leases are charged to the SoFA on a straight‑line basis over the term of the lease, even if payments are not made on such a basis.
## 1.14 Financial Instruments
The NFC has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.
The NFC investment of £500,001 with Cazenove’s Charity responsible Multi‑Asset Fund is a financial instrument with the measurement and accounting basis being fair value. The fair value as determined by the fund managers as at 31 March 2022 is £531,539.
## 1.15 Foreign Currencies
Receipt and payment recognition of transactions in foreign currencies are recorded at the rate of exchange at the time of the transaction. Exchange differences on monetary items are translated at the closing rate at the end of each reporting period with the differences taken to the Statement of Financial Activities (SoFA).
## Note 2 Grant in aid
Grant in aid of £2,400,715 was received from Defra in 2021‑2022 (2020‑21: £2,467,457). The grant is treated as unrestricted income since the Department, whilst requiring that funds allocated contribute to the delivery of its objectives, does not stipulate any specific purpose(s) as to how any of the funds must be utilised.
Grant in aid accounts for 41% of total NFC income and is utilised to fund the forest creation and woodland management programmes, including the various grant schemes, contributes to the tourism and community engagement programmes and meets a significant proportion of governance and support costs.
Grant in aid Nature for Climate Funds of £1,894,000 was received from Defra in 2021‑22 (2020‑21: £2,146,007). This grant is treated as restricted income, per the memorandum of understanding, which facilitates funding of new planting within the National Forest.
Nature for Climate Funds accounts for 32% of total NFC income.
## 1.16 Staff costs and pensions
The NFC accounts for staff costs and pension contributions in the periods for which they are payable. The Principal Civil Service Pension Scheme (PCSPS) is an unfunded multi‑employer defined benefit scheme. The NFC is unable to identify its share of the underlying assets and liabilities. The Scheme administrators carry out actuarial valuations of the Scheme and prepare full accounts for the Scheme.
The NFC recognises in its accounts those costs collected from it by the Scheme administrators in respect of Accruing Superannuation Liability Charges (ASLCs), which are shown as “Pension Costs”.
National Forest Company – Annual Report and Accounts 2021-22
42
## Note 3
## Income from Donations
||Unrestricted
£|Restricted
£|Total
2021-22
£|Unrestricted
£|Restricted
£|Total
2020-21
£|
|---|---|---|---|---|---|---|
|Donations
Dedicate a
Grove
Dedicate a Tree
Rolls Royce
Other
Total|269,902
3,025
311,936
–
–
584,863|–
–
–
20,000
1,542
21,542|269,902
3,025
311,936
20,000
1,542
606,405|175,328
33,027
252,345
–
–
460,700|–
–
–
20,000
–
20,000|175,328
33,027
252,345
20,000
–|
|||||||480,700|
Note 4
## Income from charitable activities
||Unrestricted
£|Restricted
£|Total
2021-22
£|Unrestricted
£|Restricted
£|Total
2020-21
£|
|---|---|---|---|---|---|---|
|Woodland
creation grants
Section 106
agreements
Tourism and
promotion
programme
Charnwood
Development
project
Timber Festival
National Forest
Trek
Community
Forest
Woodland
Outreach
project
Severn Trent
– Great Big
Nature Boost
ELMS Test
and Trial
Greenspring
Plant a Tree
scheme
Other
Total|–
–
–
–
–
–
–
–
–
7,250
925
4,337
12,512|12,975
27,025
18,000
307,218
6,750
47,939
60,381
201,683
45,530
–
–
25,200
752,701|12,975
27,025
18,000
307,218
6,750
47,939
60,381
201,683
45,530
7,250
925
29,537
765,213|–
–
–
–
–
–
–
–
–
–
2,070
214
2,284|11,854
4,032
18,000
125,552
67,500
21,460
36,171
126,166
–
–
–
–
410,735|11,854
4,032
18,000
125,552
67,500
21,460
36,171
126,166
–
–
2,070
214|
|||||||413,019|
National Forest Company – Annual Report and Accounts 2021-22
43
## Note 5
Income from other trading activities
||Unrestricted
£|Restricted
£|Total
2021-22
£|Unrestricted
£|Restricted
£|Total
2020-21
£|
|---|---|---|---|---|---|---|
|Other trading
activities
Sponsorship
Total|49,125
63,577
112,702|–
17,500
17,500|49,125
81,077
130,202|23,394
47,036
70,430|–
10,000
10,000|23,394
57,036|
|||||||80,430|
## Note 6
Cost of activities for raising funds
||Total
2021-22
£|Total
2020-21
£|
|---|---|---|
|Activities undertaken directly
Support costs|462,614
199,761
662,375|548,337
224,349|
|||772,686|
National Forest Company – Annual Report and Accounts 2021-22
44
|Activity or programme
Activities
undertaken
directly
£
Grant
funding of
activities
£
Support
Costs
£
Total
2021-22
£
Activities
undertaken
directly
£
Grant
funding of
activities
£
Support
Costs
£
Total
2020-21
£|Forest Creation
848,593
952,017
299,814
2,100,423
513,074
350,607
272,019
1,135,700
Woodland Management
385,320
180,780
118,862
684,963
177,050
167,276
87,412
431,738
Tourism and Promotion
109,128
1,697
52,891
163,716
55,341
56,400
65,148
176,889
Community Engagement
51,185
93,577
68,222
212,985
102,483
6,960
56,220
165,663
National Forest Trek
83,694
–
12,721
96,415
33,921
–
11,318
45,239
Charnwood Development project
249,736
–
184,028
433,764
68,405
–
85,287
153,692
Creating a Forest for Learning project
39,086
–
26,287
65,373
37,500
–
35,482
72,982
Timber Festival
168,610
–
38,672
207,283
146,475
–
53,613
200,088
Creating Working Woodlands project
105,660
–
48,745
154,405
70,870
–
58,721
129,591
Community Forest Woodland Outreach project
73,323
–
43,541
116,864
29,513
–
39,035
68,548
Severn Trent – Great Big Nature Boost
161,893
–
26,166
188,058
104,166
–
21,312
125,478
ELMS Test and Trial
73,959
–
4,164
78,122
–
–
–
–
Total
2,350,187
1,228,071
924,113
4,502,371
1,338,798
581,243
785,567
2,705,608|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
45
## Staff costs and pensions
## 8.1 Employees with earnings above £60,000
||2021-22|2020-21|
|---|---|---|
|£80,000 – £89,999
£70,000 – £79,999
£60,000 – £69,999|1
–
2
3|1
1
–
2|
## 8.2 Staff salaries, social security and pensions
|Permanent
contracts
£|Other
contracts
£|2021-22
Total
£
Permanent
contracts
£|2021-22
Total
£
Permanent
contracts
£|Other
contracts
£
Reclassified
2020-21
Total(1)
£|Other
contracts
£
Reclassified
2020-21
Total(1)
£|
|---|---|---|---|---|---|
|Salaries
1,011,808
169,483
1,181,291
887,155
Social security costs
107,493
12,971
120,464
88,300
Pension costs
266,730
39,449
306,179
230,204
1,386,031
221,903
1,607,934
1,205,659
(1) Prior year figures for social security costs and pension costs reclassified.
8.3 Average number of persons employed
2021-22
Headcount
Full time
equivalent
||||177,913
1,065,068
13,360
101,660
38,515
268,719
229,788
1,435,447
2020-21
Headcount
Full time
equivalent|1,065,068
101,660
268,719|
||||||1,435,447|
|Staff (including Chief Executive)||34|30|29|26|
The full time equivalent of employees includes 5 FTE fixed term staff and 0.2 FTE agency staff.
National Forest Company – Annual Report and Accounts 2021-22
46
|Raising
Funds
£
Forest
creation
£
Woodland
Management
£
Tourism and
Promotion
£
Community
Engagement
£
National
Forest
Trek
£
Charnwood
Development
project
£
Creating a
Forest for
Learning
project
£
Timber
Festival
£
Creating
Working
Woodlands
Project
£
Community
Forest
Woodland
Outreach
project
£
Severn
Trent –
Great Big
Nature
Boost
ELMS
Test and
Trial
Grants
administration
£
2021-22
£
Basis of
apportionment|Staff costs
109,200 134,729
33,656
22,255
18,881
6,954
100,600
14,369
21,140
26,647
23,802
14,304
2,276
120,114
648,928
Headcount
Governance Costs
29,346 36,206
9,045
5,981
5,074
1,869
27,035
3,862
5,681
7,161
6,397
3,844
612
11,795
153,908
Headcount
Premises costs
18,930
23,356
5,835
3,858
3,273
1,206
17,440
2,491
3,665
4,619
4,126
2,480
395
7,606
99,279
Headcount
ICT & Telecoms
13,591
16,768
4,189
2,770
2,350
865
12,521
1,788
2,631
3,317
2,962
1,780
283
5,463
71,279
Headcount
HR & Recruitment
16,807
20,736
5,180
3,425
2,906
1,070
15,483
2,212
3,254
4,101
3,663
2,201
350
6,755
88,143
Headcount
Office costs
3,256
4,017
1,003
664
563
207
2,999
428
630
794
710
426
68
1,309
17,074
Headcount
PR related
160
197
49
33
28
10
147
21
31
39
35
21
4
64
840
Headcount
Travel
1,631
2,012
503
332
282
104
1,502
215
316
398
355
214
34
655
8,552
Headcount
Training &
Development
1,344
1,658
414
274
232
86
1,238
177
260
328
293
176
28
540
7,047
Headcount
Depreciation
3,265
4,028
1,006
665
564
208
3,008
430
632
797
712
428
68
1,312
17,122
Headcount
Amortisation
2,231
2,753
688
455
386
142
2,055
294
432
544
486
292
46
897
11,701
Headcount
Grants
administration
–
53,354
57,294
12,179
33,683
–
–
–
–
–
–
–
–
(156,510)
–
Staff time
199,761
299,814
118,862
52,891
68,222
12,721
184,028
26,287
38,672
48,745
43,541
26,166
4,164
–
1,123,874|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
47
|Raising
Funds
£
Forest
creation
£
Woodland
Management
£
Tourism
and
Promotion
£
Community
Engagement
£
National
Forest
Trek
£
Charnwood
Development
project
£
Creating a
Forest for
Learning
project
£
Timber
Festival
£
Creating
Working
Woodlands
Project
£
Community
Forest
Woodland
Outreach
project
£
Severn
Trent
– Great Big
Nature
Boost
Grants
administration
£
2020-21
£
Basis of
apportionment|Staff costs
141,206 140,499
32,033
28,667
20,396
7,124
53,679
22,333 33,744
36,960
24,569
13,414
102,814
657,438
Headcount
Governance
Costs
18,868
18,773
4,280
3,830
2,725
952
7,172
2,984 4,509
4,938
3,283
1,792
5,881
79,987
Headcount
Premises costs
21,782
21,673
4,941
4,422
3,146
1,099
8,281
3,445 5,205
5,701
3,790
2,069
6,790
92,344
Headcount
ICT & Telecoms
15,668
15,590
3,554
3,181
2,263
790
5,956
2,478
3,744
4,101
2,726
1,488
4,884
66,423
Headcount
HR &
Recruitment
8,025
7,984
1,820
1,629
1,159
405
3,051
1,269
1,918
2,100
1,396
762
2,501
34,019
Headcount
Office costs
3,256
3,240
739
661
470
164
1,238
515
778
852
567
309
1,015
13,804
Headcount
PR related
37
37
8
8
5
2
14
6
9
10
6
4
12
158
Headcount
Travel
412
410
94
84
60
21
157
65
99
108
72
39
129
1,750
Headcount
Training &
Development
1,714
1,706
389
348
248
86
652
271
410
449
298
163
532
7,266
Headcount
Depreciation
4,161
4,140
944
845
601
210
1,582
658
994
1,089
724
396
1,297
17,641
Headcount
Amortisation
9,220
9,173
2,091
1,872
1,332
465
3,505
1,458 2,203
2,413
1,604
876
2,874
39,086
Headcount
Grants
administration
–
48,794
36,519
19,601
23,815
–
–
–
–
–
–
–
(128,729)
–
Staff time
224,349
272,019
87,412
65,148
56,220
11,318
85,287
35,482
53,613
58,721
39,035
21,312
–
1,009,916|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
48
## Note 10
## Governance costs
||2021-22
£|2020-21
£|
|---|---|---|
|Trustees' travel and expenses
Trustee meetings and meals external
Annual Report and Accounts production
Fees payable for the audit of the Annual Accounts
Internal audit fees
Bank charges
Professional and Legal Fees
Trustee recruitment
Other sundry expenditure
Strategic costs(1)|1,131
339
4,369
31,000
8,266
10,855
45,130
–
1,117
51,699
153,906|11
–
2,558
24,000
11,566
9,187
–
–
200
32,465|
|||79,987|
(1) Strategic costs represent 45% of the Chief Executive’s employment costs (2020:21 34%)
National Forest Company – Annual Report and Accounts 2021-22
49
## Note 11 Intangible Assets
|Asset under
construction
£|Asset under
construction
£|Website
£|Total
£|
|---|---|---|---|
|Cost or valuation
At 1 April 2021
Additions during the year
Transfer during the year
At 31 March 2022
Amortisation
At 1 April 2021
Charges in the period:
At 31 March 2022
Net Book Value 31 March 2022
Cost or valuation
At 1 April 2020
Additions during the year
Transfer during the year
At 31 March 2021
Amortisation
At 1 April 2020
Charges in the period:
At 31 March 2021
Net Book Value 31 March 2021|–
42,661
–
42,661
–
–
–
42,661
–
–
–
–
–
–
–
–|117,258
–
–
117,258
99,707
11,701
111,408
5,850
117,258
–
–
117,258
60,621
39,086
99,707
17,551|117,258
42,661
–|
||||159,919|
||||99,707
11,701|
||||111,408|
||||48,512|
||||117,258
–
–|
||||117,258
60,621
39,086|
||||99,707|
||||17,551|
Asset under construction relates to the charges incurred for the re‑development of the new website.
National Forest Company – Annual Report and Accounts 2021-22
50
## Note 12 Tangible Assets
||Land
£
Furniture &
Fittings
£|Land
£
Furniture &
Fittings
£|Information
Technology
£|Total
£|
|---|---|---|---|---|
|Cost or valuation
At 1 April 2021
Additions during the year
Disposals/transfers during the year
Impairment
Reversal of prior years' impairment
Revaluation (loss)/gain to Revaluation Reserve
Investment property transfer
At 31 March 2022
Depreciation
At 1 April 2021
Charges in the period:
Depreciation
Revaluation
Depreciation charged on disposals
Investment property transfer
At 31 March 2022
Net Book Value 31 March 2022
Cost or valuation
At 1 April 2020
Additions during the year
Disposals/transfers during the year
Impairment
Reversal of prior years' impairment
Revaluation (loss)/gain to Revaluation Reserve
Investment property transfer
At 31 March 2021
Depreciation
At 1 April 2020
Charges in the period:
Depreciation
Revaluation
Depreciation charged on disposals
Investment property transfer
At 31 March 2021
Net Book Value 31 March 2021|2,385,150
–
–
(519,000)
106,350
59,500
1,111,500
3,143,500
–
–
–
–
–
–
3,143,500
3,751,050
1,274,943
–
(250,493)
24,000
17,500
(2,431,850)
2,385,150
–
–
–
–
–
–
2,385,150|161,303
23,710
–
–
–
–
–
185,013
151,122
3,023
–
–
–
154,145
30,868
157,956
3,347
–
–
–
–
–
161,303
148,660
2,462
–
–
–
151,122
10,181|138,374
23,619
–
–
–
–
–
161,993
92,332
14,099
–
–
–
106,431
55,562
121,713
16,661
–
–
–
–
–
138,374
77,153
15,179
–
–
–
92,332
46,042|2,684,827
47,329
–
(519,000)
106,350
59,500
1,111,500|
|||||3,490,506|
|||||243,454
17,122
–
–
–|
|||||260,576|
|||||3,229,930|
|||||4,030,719
1,294,951
–
(250,493)
24,000
17,500
(2,431,850)|
|||||2,684,827|
|||||225,813
17,641
–
–
–|
|||||243,454|
|||||2,441,373|
Investment property transfer ‑ Land value of £1,111,500 has been reclassified from investment property (Note 13 Land), due to land surrendered on Farm Business Tenancies.
For each revalued class of tangible asset the carrying amount, had the assets been carried under the historical cost model, is required to be disclosed: Land £2,749,887 (2020‑21: £2,186,033).
An annual valuation of NFC land and buildings as at 31 March is undertaken by an independent Chartered Surveyor. Changes in the value of land or buildings arising from revaluation or impairment are therefore reflected.
Impairments on land is charged to the SoFA through expenditure on charitable activities via Forest Creation activity (Note 7).
Reversal of prior years’ impairment on land is charged to the SoFA through expenditure on charitable activities via Forest Creation activity (Note 7).
National Forest Company – Annual Report and Accounts 2021-22
51
## Note 13
## Investments
||Property
£|Land
£
Cazenove
Investment
Fund
£|Land
£
Cazenove
Investment
Fund
£|Total
£|
|---|---|---|---|---|
|Cost or valuation
At 1 April 2021
Additions during the year
Disposals/transfers during the year
Impairment
Reversal of prior years' impairment
Revaluation (loss)/gain
At 31 March 2022
Cost or valuation
At 1 April 2020
Additions during the year
Disposals/transfers during the year
Revaluation (loss)/gain
At 31 March 2021|500,000
–
–
–
–
25,000
525,000
480,000
–
–
20,000
500,000|3,006,850
866,580
(1,111,500)
(25,000)
25,650
43,420
2,806,000
–
707,640
2,431,850
(132,640)
3,006,850|505,015
–
–
–
–
26,524
531,539
–
500,000
–
5,014
505,015|4,011,865
866,580
(1,111,500)
(25,000)
25,650
94,944|
|||||3,862,539|
|||||480,000
1,207,641
2,431,850
(107,626)|
|||||4,011,865|
Investment Land includes 9 sites that are part or wholly, commercially let.
In the 2021‑22 financial year, £1,111,500 (relating to 3 sites) has been transferred and re‑classified to Tangible Assets (Note 12, Land) due to land surrendered on Farm Business Tenancies.
For each revalued class of investment asset the carrying amount, had the assets been carried under the historical cost model, is required to be disclosed: Property £335,000 (2020‑21: £335,000): Land £2,259,550 (2020‑21: £2,674,834).
An annual valuation of NFC land and buildings as at 31 March is undertaken by an independent Chartered Surveyor. Changes in the value of land or buildings arising from revaluation or impairment are therefore reflected.
In the 20‑21 financial year £500,001 was invested in Cazenove Charity Responsible Multi‑Asset Fund, generating a return of £26,524 in 2021‑22. The income is extracted to our reserves, rather than re‑invested into the fund. Fair value measurement of the fund by the investment managers as at 31 March resulted in a gain of £26,524. This has been reflected as a cash equivalent due to it being a high liquid investment.
National Forest Company – Annual Report and Accounts 2021-22
52
## Note 14 Debtors
|Amounts falling due within one year:|31 March
2022
£|31 March
2021
£|
|---|---|---|
|VAT
Prepayments
Accrued Income:
– Creating Working Woodlands project
– Creating a Forest for Learning project(1)
– Charnwood project ‑ NLHF funding
– Timber Festival
– Community Forest Woodland Outreach project
– Other
Debtors:
– Trade debtors
– Other debtors
Amount falling due after more than one year:
Other debtors
Total debtors|9,098
69,461
–
135,675
57,999
–
10,675
90,075
238,539
10,379
621,901
–
–
621,901|10,926
42,552
104,110
149,295
26,267
33,750
14,710
55,256
86,120
16,162|
|||539,148|
|||9,510|
|||9,510
548,658|
(1) Creating a Forest for Learning project accrued income includes the unrealised exchange gain on foreign currency.
National Forest Company – Annual Report and Accounts 2021-22
53
## Note 15
Cash at bank and in hand
||31 March
2022
£|31 March
2021
£|
|---|---|---|
|Balance at 1 April:
Net increase/(decrease) in cash and cash equivalent balances
Balance at 31 March
The following balances at 31 March 2022:
Commercial banks and cash in hand
Government Banking Service|2,149,010
381,517
2,530,527
2,277,938
252,589
2,530,527|2,026,219
122,791|
|||2,149,010|
|||2,144,303
4,707|
|||2,149,010|
National Forest Company – Annual Report and Accounts 2021-22
54
|Note 16
Creditors
31 March
2022
£
31 March
2021
£
Amounts falling due within
one year:
Trade creditors
176,434
76,424
Other Creditors
3,300
3,300
Accruals
215,937
140,276
Deferred income(1)
192,319
114,005
587,990
334,005
(1) Deferred income relates to specified outputs delivered in 2022‑23
Analysis of movement of deferred income
Other
Severn Trent
– Great Big
Nature Boost
Carbon project
Community
Forest Woodland
Outreach project
£
Charnwood
Development
project
£
Creating a Forest
for Learning
project
£
Total
£|31 March 2017 Deferred
–
–
–
3,962
44,403
48,365
31 March 2018 Released
–
–
–
(3,962)
(44,403)
(48,365)
31 March 2018 Deferred
–
–
–
2,000
36,364
38,364
31 March 2019 Released
–
–
–
(2,000)
(36,364)
(38,364)
31 March 2019 Deferred
–
–
–
–
28,151
28,151
31 March 2020 Released
–
–
–
–
(28,151)
(28,151)
31 March 2020 Deferred
3,650
–
8,333
–
–
11,983
31 March 2021 Released
(3,650)
–
–
–
–
(3,650)
31 March 2021 Deferred
5,672
100,000
–
–
–
105,672
31 March 2022 Released
(5,672)
–
(8,333)
–
–
(14,005)
31 March 2022 Deferred(1)
10,387
31,932
50,000
–
–
–
92,319
Total
10,387
31,932
150,000
0
0
0
192,319
(1)Deferred income ‘Other’ 2022 relates to sponsorship contracts £10,387 split over two financial years.|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
55
|Analysis of Grants
The NFC awards grants to a number of institutions and landowners to support activity which contributes to the achievement of its charitable objects. No grants were paid
with the purpose of directly benefitting the personal circumstances of the individuals.
Grants to
Institutions
£
Grants to
Landowners
£
Support
Costs
£
2021-22
£
Grants to
Institutions
£
Grants to
Landowners
£
Support
Costs
£
2020-21
£|Forest creation, access and nature conservation
901,462
50,555
53,354
1,005,371
117,760
232,847
48,794
399,401
Woodland Management
23,452
157,328
57,294
238,074
40,090
127,186
36,519
203,795
Community engagement
93,577
‑
33,683
127,260
56,400
‑
23,815
80,215
Tourism and promotion
1,697
‑
12,179
13,875
6,960
‑
19,601
26,561
Total
1,020,188
207,883
156,510
1,384,581
221,210
360,033
128,729
709,972
During the 2021‑22 financial year, the NFC awarded grants to the following:
Institution and/or Landowner
2021-22
£
2020-21
£
South Derbyshire District Council
29,608
32,500
Leicestershire County Council
138,167
17,335
NFCT
300,000
–
Mountpark Logistics
339,027
–
Shuttlewood Clarke Foundation
–
17,157
Duchy of Lancaster
6,905
105,961
Trustees of Burton Property Group
–
29,176
NMA
36,369
–
Grants to other institutions
170,111
19,080
Grants to landowners/Individuals
207,884
360,034
Total Grants paid
1,228,071
581,243|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
56
|Note 18
Summary of fund movements 2021‑22
As at
1 April 2021
£
Income
£
Expenditure
£
Revaluation
£
Foreign Currency
gain/(loss)
£
Transfers(1)
£
As at
31 March 2022
£|Unrestricted
General Fund
3,488,284
3,156,653
(2,632,129)
–
–
(816,896)
3,195,912
Financial Contingency Fund(4)
450,000
–
–
–
–
50,000
500,000
Land Acquisition, Management and
Development Fund(5)
450,000
–
–
–
–
–
450,000
Enterprise and Investment Fund(6)
500,000
–
–
–
–
–
500,000
Investments(7)
1,793,528
–
–
61,621
–
640,841
2,495,990
Revaluation Reserve
77,250
–
–
59,500
–
–
136,750
Total Unrestricted
6,759,062
3,156,653
(2,632,129)
121,121
–
(126,055)
7,278,652
Restricted
Nature for Climate Funds
1,656,150
1,894,000
(1,458,954)
33,323
–
2,124,519
Other restricted funds(2)
14,310
76,842
(67,080)
–
–
–
24,072
Creating a Forest for Learning project
196,337
–
(39,086)
–
38,873
–
196,124
Timber Festival(3)
26,566
24,250
(114,502)
–
–
63,686
–
Creating Working Woodlands project
131,550
200
(117,636)
–
–
14,114
Charnwood Development project
47,956
307,218
(291,375)
–
–
–
63,799
National Forest Trek
–
47,939
(70,374)
–
–
22,435
–
Community Forest Woodland Outreach project
2,521
68,081
(82,071)
–
–
15,608
4,140
Rolls Royce
–
20,000
(20,000)
–
–
–
–
Severn Trent – Great Big Nature Boost
–
201,683
(201,683)
–
–
–
–
ELMS Test and Trial
–
45,530
(69,856)
–
–
24,326
–
Total Restricted
2,075,390
2,685,743
(2,532,617)
33,323
38,873
126,055
2,426,767
Total Reserves
8,834,452
5,842,396
(5,164,746)
154,444
38,873
–
9,705,419
(1) Transfer from unrestricted (General fund) to restricted funds are match funding contributions National Forest Trek £22,435, Community Forest Woodland Outreach Project £15,608, ELMS Test and Trial £24,326 and
support for the 2021 and 2022 Timber festival £63,686.
(2) Other restricted funds include Woodland Trust and Section 106 income carried forward.
(3) Timber Festival transfer £63,687 at 31 March 2022 is £43,687 for the 2021 Festival and £20,000 for the 2022 Festival.
(4) Financial Contingency Fund – equates to approximately four months of NFC running costs and to be used in the event of major cashflow problems.
(5) Land Acquisition, Management and Development Fund (LAMDF) ‑ available to support land acquisition and initial site establishment costs.
(6) Enterprise and Investment Fund (EIF) ‑ available to support innovation, enterprise and long‑term financial sustainability.
(7) Investments – the value as per Note 13 £3,862,539 of which £2,495,990 is unrestricted and the balance £1,366,549 restricted as part of Nature for Climate Funds reserve (Note 20).|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
57
|Note 18 – continued
Summary of fund movements 2020‑21
As at
1 April 2020
£
Income
£
Expenditure
£
Revaluation
£
Foreign Currency
gain/(loss)
£
Transfers(1)
£
As at
31 March 2021
£|Unrestricted
General Fund
4,357,643
3,027,677
(2,520,869)
–
–
(1,376,167)
3,488,284
Financial Contingency Fund(4)
450,000
–
–
–
–
–
450,000
Land Acquisition, Management and
Development Fund(5)
450,000
–
–
–
–
–
450,000
Enterprise and Investment Fund(6)
500,000
–
–
–
–
–
500,000
Investment Property
480,000
–
–
(223)
–
1,313,751
1,793,528
Revaluation Reserve
59,750
–
–
17,500
–
–
77,250
Total Unrestricted
6,297,393
3,027,677
(2,520,869)
17,277
–
(62,416)
6,759,062
Restricted
Nature for climate funds
–
2,146,007
(382,454)
(107,403)
–
1,656,150
Other restricted funds(2)
20,278
33,886
(39,854)
–
–
–
14,310
Creating a Forest for Learning project
294,544
–
(53,687)
–
(44,520)
–
196,337
Timber Festival(3)
–
77,500
(110,868)
–
–
59,934
26,566
Creating Working Woodlands project
214,396
–
(82,846)
–
–
131,550
Charnwood Development project
5,310
125,552
(82,906)
–
–
–
47,956
National Forest Trek
–
21,460
(23,942)
–
–
2,482
–
Community Forest Woodland Outreach project
1,052
36,171
(34,702)
–
–
–
2,521
Rolls Royce
–
20,000
(20,000)
–
–
–
–
Severn Trent – Great Big Nature Boost
–
126,166
(126,166)
–
–
–
–
Total Restricted
535,580
2,586,742
(957,425)
(107,403)
(44,520)
62,416
2,075,390
Total Reserves
6,832,973
5,614,419
(3,478,294)
(90,126)
(44,520)
–
8,834,452
(1) Transfer from unrestricted (General and Enterprise and Investment Fund) to restricted funds are match funding contributions National Forest Trek £2,482 and support for the 2020 Timber festival £59,934.
(2) Other restricted funds relates to Section 106 income carried forward.
(3) Timber Festival transfer £59,934 at 31 March 2021 is for the 2020 Festival, with the balance of £26,566 for the 2021 Festival.
(4) Financial Contingency Fund ‑ equates to approximately four months of NFC running costs and to be used in the event of major cashflow problems.
(5) Land Acquisition, Management and Development Fund (LAMDF) ‑ available to support land acquisition and initial site establishment costs.
(6) Enterprise and Investment Fund (EIF) ‑ available to support innovation, enterprise and long‑term financial sustainability
(7) Investments ‑ Land transfer as per Note 13 is £2,431,850 of which £1,313,751 is unrestricted and the balance £1,118,099 restricted as part of Nature for Climate Funds reserve £1,656,150.|
|---|---|
National Forest Company – Annual Report and Accounts 2021-22
58
## Note 19
Analysis of net assets between funds
|Unrestricted
£|Unrestricted
£|Restricted
£|Total
31 March
2022
£
Unrestricted
£|Total
31 March
2022
£
Unrestricted
£|Restricted
£|Total
31 March
2021
£|
|---|---|---|---|---|---|---|
|General Fund
7,141,902
Revaluation Reserve
136,750
Net assets
7,278,652
Note 20
Analysis of funds
Unrestricted
£||2,426,767
–
2,426,767
Restricted
£|9,568,669
6,681,812
108,750
77,250
9,677,419
6,759,062
Total
31 March
2022
£
Unrestricted
£||2,075,390
–
2,075,390
Restricted
£|8,757,202
77,250|
|||||||8,834,452|
|||||||Total
31 March
2021
£|
|Reserve balances
at 31 March are
represented by:
Intangible assets
Fixed assets
Investments
Current assets
Creditors
Total reserves|48,512
2,776,831
2,495,990
2,545,309
(587,990)
7,250,652|–
453,099
1,366,549
607,119
–
2,426,767|48,512
3,201,930
3,862,539
3,152,428
(587,990)
9,677,419|17,551
2,412,416
2,428,169
2,234,931
(334,005)
6,759,062|–
28957
1583696
462,737
–
2,075,390|17,551
2,441,373
4,011,865
2,697,668
(334,005)|
|||||||8,834,452|
## Note 21
## Commitments under operating leases
The future minimum lease payments under operating leases which the NFC is committed to make under operating leases are as follows:
|31 March 2022
£|31 March 2022
£|31 March 2021
£|
|---|---|---|
|Obligations under operating leases comprise:
Buildings, office accommodation lease
Not later than one year
Later than one year and within five years
Later than five years|40,857
–
–
40,857|48,081
48,081
–|
|||96,162|
The above obligations relate to the lease for office accommodation occupied by the National Forest Company which commenced on 1 April 2018 and will expire on 31 March 2023.
The lease expense for 2021‑22 was £47,996 (2020‑21: £47,785).
National Forest Company – Annual Report and Accounts 2021-22
59
## Note 21 ‑ continued
The future minimum lease payments under operating leases which the NFC is committed to receive under operating leases are as follows:
|31 March 2022
£|31 March 2022
£|31 March 2021
£|
|---|---|---|
|Recognition under operating leases comprise:
Farmhouse and Farm Business Tenancies (FBTs) leases
Not later than one year
Later than one year and within five years
Later than five years|23,270
4,000
–
27,270|25,951
194
–|
|||26,145|
The above recognition relates to the lease of National Forest Company owned assets.
Hanging Hill Farm is a periodic short term tenancy.
FBTs are short term grazing and grassland tenancies on various sites.
## Note 22
## Other financial commitments
## Forest creation schemes
The Company has entered into contracts (which are not leases or PFI contracts) under the Changing Landscape Scheme (CLS) and the Freewoods and Parkland Schemes. The payments to which the NFC is committed, analysed by the period during which the commitments fall due, are as follows:
|31 March 2022
£|31 March 2022
£|31 March 2021
£|
|---|---|---|
|Not later than one year
Later than one year and not later than five years
Later than five years|71,015
338,525
7,921
417,461|37,702
263,232
18,469|
|||319,403|
National Forest Company – Annual Report and Accounts 2021-22
60
## Note 23
## Financial Instruments
As the current cash requirements of the NFC are met largely through grant‑in‑aid received from Defra, financial instruments play a more limited role in creating risk than would apply to a non‑public sector body of a similar size. The NFC has no complex financial instruments and the risk of exposure to credit, liquidity or market risk is minimal.
The NFC investment of £500,001 with Cazenove’s Charity responsible Multi‑ Asset Fund is a financial instrument with the measurement and accounting basis being fair value. Of which the fair value being determined by the fund managers as at 31 March 2022 to be £531,539.
## Other related parties:
The NFC has dealings with the Department for Environment, Food and Rural Affairs (Defra) and some of its sponsored bodies. The NFC receives grant in aid from Defra. During the year, the NFC received £2,400,715 (2020‑21: £2,467,457) GiA and £1,894,000 (2020‑21: £2,146,007) via the Nature for Climate Fund.
The NFC received £12,977 from Rural Payments Agency (2020‑21: £26,507) for woodland grants.
The NFC received £52,000 (2020‑21: £36,171) from Natural England for the Community Forest Woodland Outreach project.
The NFC paid NIL (2020‑21: £46,596) to Forestry England for employee secondment costs.
## Note 24
## Related party transactions
Key management personnel of the Charity: John Everitt has been a member of the National Lottery Heritage Fund Midlands and East Committee since January 2015. Grant Support of £224,577 (2020‑21: £63,455) was received for the Charnwood Forest Landscape Partnership Scheme project; John Everitt declared an interest and was not party to the decision to award the funds.
Chair, Lord Duncan of Springbank, appointed on 20 May 2020 is Chair of Confor. The NFC paid £330 (2020‑21: £314) for membership subscription.
Trustee, Alison Field, appointed on 1 April 2018, is a Council Member of the Institute of Chartered Foresters (ICF). The NFC paid nil (2020‑21: £450) to the ICF.
Trustee, Mike Kapur, appointed on 1 April 2018, is Chair of Leicester City Football Club Trust and member of Council of University of Leicester. The NFC received nil (2020‑21: £525) from the University of Leicester. The NFC paid £19,278 (2020‑21: £4,079) to Leicester City Football Club Trust for the Community Forest Woodland Outreach project.
Trustee, Paddy Harrop, appointed 1 April 2018, is Forest Management Director Central England, Forestry England. The NFC paid nil (2020‑21: £46,596) to Forestry England.
During the year, no trustee or related parties has undertaken any material transactions with the Charity other than those disclosed in the Remuneration and Staff Report.
The NFC has an agreement with Forest Research allowing access to a National Forest site at Eastern Old Parks in order to undertake research into Ash Dieback disease.
## Note 25
## Events after the reporting period
On 1 April 2022 the National Forest Company (NFC) and National Forest Charitable Trust (NFCT) merged and combined into one reporting entity under the NFC. The NFCT will dissolve once their final accounts up to 31 March 2022 are completed. The NFCT’s financial statements can be found at https://find‑ and‑update.company‑information.service.gov.uk/ company/03468753.
The merger included the transfer of all NFCT assets including two trading subsidiaries, Heart of the National Forest Park Developments Ltd and Forest Experience Ltd, that will now be wholly owned by the NFC.
There was no consideration paid for the merger, but a grant of £300,000 was provided to the NFCT pre‑ reporting date to enable them to settle liabilities to release the assets for transfer.
The assets, liabilities, and shares (of the two subsidiaries) of the NFCT will be transferred into the control of NFC for a nominal value and are in substance a gift. The land and buildings will be transferred at fair value as per the valuations as at 1 April 2022 undertaken by independent Chartered Surveyors Fisher German and Matthews and Goodman in accordance with the RICS Valuation Standards (the ‘Red Book’). As the value of the assets received will exceed the fair value of the liabilities assumed, the assets will be accounted as a gain will be recognised and shown separately within income, as a gift.
National Forest Company – Annual Report and Accounts 2021-22
61
The Annual Report and Accounts have been authorised for issue by the National Forest Company’s Chief Executive and Trustees. The authorised to issue date is the date of the Comptroller and Auditor General’s audit certificate.
National Forest Company – Annual Report and Accounts 2021-22
**24/11/2022 14:37**
**E02755195_HC 825 National Forest Company ARA 21-22.indd 62**
**24/11/2022 14:37**
**E02755195_HC 825 National Forest Company ARA 21-22.indd 63**
ISBN 978‑1‑5286‑3410‑6 E02755195