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2023-12-31-accounts

(A Charitable Company Limited by Guarantee)

ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS

31st December 2023

Company Number: 01765239

Registered Charity Number: 290866

Lhasa Limited CONTENTS

Contents Page
Mission Statement 1
Officers and Professional Advisors 2
Directors’ and Trustees’ Report 3
Statement of Trustees’ Responsibilities 19
Independent Auditor’s Report to the Members of Lhasa Limited 20
Consolidated Statement of Financial Activities (incorporating an
income and expenditure account) 24
Consolidated and Charity Balance Sheet 25
Consolidated Statement of Cash Flows 26
Accounting Policies 27
Notes to the Financial Statements 32

Lhasa Limited Granary Wharf House 2 Canal Wharf Leeds LS11 5PS United Kingdom Tel: + 44 (0) 113 394 6020 Email: info@lhasalimited.org Web: www.lhasalimited.org

Lhasa Limited MISSION STATEMENT

OBJECTIVES

Lhasa Limited is a not-for-profit, charitable organisation whose objective is to promote scientific knowledge and understanding through the development of computer-aided reasoning and information systems in chemistry and the chemistry-related sciences.

OUR MISSION

Shared Knowledge, Shared Progress

OUR VISION

“To be acknowledged and trusted by our members and the scientific community as the world leader in knowledge and data sharing for chemistry-related sciences.”

OUR CORE VALUES

We care about the difference we can make | Ownership

We achieve more when we work together | Collaboration

We commit to doing the right thing | Integrity

We create an environment where everyone can succeed | Diversity and Inclusivity

We maximise our potential by seeking and embracing new ideas | Curiosity and Adaptability

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Lhasa Limited OFFICERS AND PROFESSIONAL ADVISORS

Chair: Mr S Marsland
Deputy Chair: Dr S Gutsell
Other Trustees:
Dr C Alexander-White
Mr A Bowie (resigned 21 June 2023)
Dr R Brennan
Mr S Clarke (appointed 13 December 2023)
Dr K Dobo
Ms T Lichtensteiger (appointed 13 December 2023)
Dr J Harvey
Mr M Mills
Mr D Ratcliffe
Mr D Rawson
Chief Executive Officer: Dr C Barber
Registered Office: Granary Wharf House
2 Canal Wharf
Holbeck
Leeds
LS11 5PS
Auditors: Mazars LLP
5thFloor
3 Wellington Place
Leeds
LS1 4AP
Bankers: HSBC Bank
33 Park Row
Leeds
LS1 1LD
Solicitors: Irwin Mitchell LLP
2 Wellington Place
Leeds
LS1 4BZ
Registered Charity Number: 290866
Company Number: 01765239

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Lhasa Limited

DIRECTORS’ AND TRUSTEES’ REPORT

The Board of Trustees presents the report and financial statements of Lhasa Limited for the year ended 31 December 2023. The statements appear in the format required by the Statement of Recommended Practice for Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

The report and statements also comply with the Companies Act 2006 (as amended August 2013) as Lhasa Limited was incorporated as a Company Limited by Guarantee on 27 October 1983. It has no share capital and is a registered charity. The guarantee of each member is limited to £10. The governing documents are the Memorandum and Articles of Association of the company and members of the Board of Trustees are the Directors of the company.

1. STRUCTURE GOVERNANCE AND MANAGEMENT

The Charity is governed by its Articles of Association (June 2013), it’s Memorandum of Association (June 2006) and its Codes of Practice (December 2008).

GOVERNANCE

The governing bodies consist of a Board of Trustees, responsible for the governance of the Charity; a Scientific Advisory Board, responsible for scientific matters, and a Finance and Investment SubCommittee, responsible for working with our Investment Managers (RBC Brewin Dolphin UK, Leeds and Investec Wealth & Investment, Leeds), which reports to the Board of Trustees. All of these bodies meet quarterly in Leeds when it is possible to do so or virtually when it is not.

RECRUITMENT, INDUCTION AND TRAINING OF TRUSTEES

In accordance with policy, Trustees are recruited either by recommendation or via a recruitment process for their specific skills defined as a requirement by the Board of Trustees. Upon approval, potential Trustees are sent an induction pack covering their obligations under Charity and Company Law; Articles of Association; Memorandum of Association and Codes of Practice; company policies and a non-disclosure agreement. Potential Trustees are invited to attend a maximum of two meetings as observers and after these two meetings the Board of Trustees and the individual consider their suitability to act as a Trustee ahead of their formal acceptance to the post. Upon acceptance and appointment, Trustees receive an induction to the business, covering key aspects of the organisation, its operations including salient Health and Safety, Information Security and GDPR information.

Charity Commission news and guidelines on good governance are reported to the Board on a quarterly basis.

MEMBERSHIP OF LHASA LIMITED

As at the Annual General Meeting held on 21 June 2023, there were 599 members of which 176 were full members, 407 associate, 1 honorary and 15 affiliate members of Lhasa Limited. At the Ordinary General Meeting held on 13 December 2023, there were 612 members of which 178 were full, 418 associate, 1 honorary and 15 affiliate members. A list of Lhasa Limited member organisations can be found on the Lhasa Limited website (www.lhasalimited.org).

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

MANAGEMENT AND STAFFING

Day to day management is delegated to the Chief Executive Officer who leads the management team based in Leeds. Key members of the management team are:

Chief Executive Officer Dr C Barber Director of Applied Sciences Dr C Heghes Director of Science Dr A Fowkes Head of Finance Ms C Williams Head of Information Technology Vacant at 31 December 2023 Head of People and Culture Ms S Kelly Head of Software Development Mr M Anoshehpour Head of Solutions Dr N Marchetti Business Improvement Manager Dr G Poignant

The Chief Executive Officer formally reports to the Board of Trustees through a quarterly report and by attendance at quarterly meetings of the Board of Trustees. Progress is reviewed with the Chairman, the immediate past Chairman and Deputy Chairman monthly, via telephone conference.

At 31 December 2023, staff numbers stood at 182 against the 160 of the previous year.

Remuneration Policy

The Board of Trustees give up their time freely and no trustee received remuneration in the year. Details of Trustees’ expenses are disclosed in note 7 to the accounts. The Board of Trustees entrust the directing, controlling, running and operation of the Charity to the Chief Executive Officer who is supported by the key management personnel. The pay of the senior staff is reviewed annually and increased in accordance with the company remuneration policy which is applicable to all Lhasa staff.

PUBLIC BENEFIT

The Lhasa Limited Board of Trustees holds in high regard the principle of public benefit and requires the Chief Executive Officer and staff of Lhasa Limited to pursue policies that demonstrate this. The Board of Trustees, at its quarterly meetings, reviews ongoing charitable activities to ensure consistency with our charitable objects. The Board of Trustees is aware of the Charity Commission’s guidance on public benefit and has had regard to it in determining the Charity’s aims and objectives and in the way it carries out its activities.

For the public benefit, the Charity is committed to enabling scientists to make better predictions on the safety of drugs, chemicals and cosmetics by providing members with software systems that support research on toxicology, metabolism and degradation. The Charity is committed to the development and use of computer-aided reasoning and information systems for the advancement of chemistry and the life sciences. This further benefits the public by:

Our Membership model and charitable status facilitates the sharing of confidential data with Lhasa that supports collaborative development of more predictive software which would not normally be made available. This position has been recognised in EU public/private partnership projects in which Lhasa is recognised as the eponymous ‘Honest Broker’ for the management of confidential data. During 2023, Lhasa hosted data within the EU Project eTRANSAFE and ran 7 data sharing consortia (where consortia members gain access to the donated data). In addition, members continue to donate data to Lhasa that is being used to improve models available to all sponsoring Lhasa members

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DIRECTORS’ AND TRUSTEES’ REPORT

(thereby sharing knowledge derived from private data). These donations are supporting the improvement of predictions made within Derek, Effiris, Sarah, Mirabilis and Zeneth. Effiris is a qualitative model suite that uses a machine-learning technique to apply privacy-preserving knowledge transfer in order to learn from multiple sources of proprietary data.

In support of its charitable purpose, Lhasa has made freely available the Lhasa Carcinogenicity Database – ensuring continued access to data that used to be provided by CPDB which is no longer available. This valuable data set has been supplemented with additional data ensuring it will continue to provide public benefit.

The charitable aims of Lhasa Limited include the sponsorship of activities that advance scientific knowledge and understanding through the use of computer-aided reasoning in chemistry and the life sciences. The Charity directly promotes and encourages the use of our software for academic teaching and research by offering membership on significantly preferential terms. In addition, the Charity actively supports research through the teaching of the use of computer aided reasoning in toxicology and the sponsorship of:

As well as performing research and development, the Charity is committed to providing financial support for others to carry out their own research and to discuss their findings to further advance and refine the science. Specifically, the Charity provides support for research within academic institutions and the outcomes of this research, and that of our own scientists, are disseminated through publications, talks and poster presentations at relevant scientific events all around the world, encouraging further work in the public domain.

The software developed by the Charity enables the scientific community to carry out research much more effectively, reducing animal use in experiments, helping to improve toxicological testing, and improving the communication of knowledge about toxicology and metabolism. Members, academic scientists, and government regulatory organisations benefit from the unique data and knowledgesharing approach of Lhasa Limited, enhancing quality of life by assisting in the development of, and access to, safer chemical entities for the benefit of the public. Lhasa works closely with its membership to identify new areas of application for computer aided reasoning and develops specialist software that meets that need.

Our position as a Charity makes it easier for organisations to donate their data, secure in the knowledge that it will only be used to promote scientific development to the benefit of all and, as such, we are able to access data and knowledge that would otherwise not be accessible. In addition, our position is seen as key for sharing contributed data (for example our role in the IMI eTRANSAFE consortia where we held the position of “honest broker”), which further expands (and makes more effective) the scope of scientific collaboration for the public benefit.

Membership and software sponsorship fees are used to support the ongoing research and development carried out by the Charity. Through the generous funding of our main sponsors, Lhasa Limited is able to offer very low fees to academic organisations and public non-political bodies to ensure that its knowledge is available to the widest possible public audience. In addition, members contribute the results of their own research, thereby making scientific research publicly available

that would not otherwise be accessible to the scientific community. The Charity therefore plays an invaluable role by bringing previously unpublished information into the public domain, and permitting the knowledge derived from this to be used by the scientific community for the public benefit. The science behind our efforts on behalf of members is published in accredited scientific journals and our scientists attend conferences across the world in order to promote our charitable purpose. During 2023 Lhasa had 21 articles published, made 21 presentations to conferences, and presented 15 scientific posters.

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

RESERVES POLICY

Lhasa Limited’s reserves policy requires the retention of funds sufficient to encompass:

CURRENT POSITION

Based upon the above our present position is:

Group Charity
Dec-23 Dec-23
£'000s £'000s
Unrestricted Reserves £23,701 £23,773
Fixed Assets £7,773 £7,747
Designated Pension Deficit Top Up Fund - -
Designated Development Fund £6,000 £6,000
Total Designated Funds (excluding Pension Provision) £13,773 £13,747
Free Reserves £ 9,928 £10,026
2024 Forecasted Costs - 25% £5,253 £5,119
2024 Forecasted Costs - 50% £10,507 £10,239

Free reserves for the charity are £213k below the maximum that the Board of Directors would normally expect to hold. Additional reserves were accrued during 2020 as a result of prudent action taken in response to the coronavirus pandemic, during 2021 the challenge of recruiting resulted in a further increase to reserves. The trustees established a £2,000k Development Fund in 2021 to support further advancement of Lhasa’s charitable objectives over the next 3-5 years, £690k was released and £2,000 added to this Fund during 2022 and a further £2,214k was released in 2023. The Trustees have added a further £4,904k to the Designated Development Fund in 2023 to enable continued investment bringing the balance to £6,000k. In accordance with the policy, we have designated funds equal to tangible and intangible fixed assets and all additional designated funds are allocated from the balance of Fixed Assets.

Fixed assets

The movement in intangible and tangible fixed assets are set out in notes 8 and 9 respectively.

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

INVESTMENT

During 2012, in accordance with Charity Commission guidelines, the Board of Trustees took the decision to review the investment policy of the Charity and to invest a proportion of the Charity’s reserves. Brewin Dolphin were appointed as investment managers for the Charity, reporting to the Board of Trustees through the Finance and Investment Sub-Committee (FIC). During 2022 the Investment Policy was updated, and this has been reviewed in 2023 to ensure it remains appropriate to meet the current needs of Lhasa. An additional Investment Manager, Investec Wealth & Investment was appointed in 2018.

The Investment advisers produce detailed written reports which value the portfolio and record its respective performance statistics, these are presented to the FIC on a quarterly basis. An integral part of the regular meetings is a discussion on the content of the report with particular reference to the performance aspect.

As at 31 December 2023, the total investment portfolios held were valued at £10,298k (2022: £9,337k). The portfolios produced an annual gross income of £202k (2022: £195k), which is equivalent to a gross yield of 1.97% (2022: 2.09%). The Brewin Dolphin portfolio was initiated with an investment of £750k in 2013. During both 2014 and 2015 an additional sum of £500k was added to the portfolio in 2020 a further sum of £2,000k was added and in 2021 there was a further addition of £1,150k; giving a total invested of £4,900k. An additional portfolio was initiated with Investec Wealth & Investment in November 2018 with an initial investment of £500k. During both 2019 and 2020 an additional sum of £1,000k was added to this portfolio and in 2021 there was a further addition of £1,150k; giving a total invested of £3,650k. All sums invested are specifically approved by the Board of Trustees.

Lhasa Limited holds investments with a long-term view and receives regular updates from our Investment Managers to ensure that the portfolios are still appropriate for our risk appetite, and both have confirmed that the portfolios remain suitable and are in line with our investment objectives. Both portfolios showed a net gain during 2023.

The structure of the portfolios is in accordance with the current Investment Policy.

Subsidiary

During 2023 Lhasa Limited established a trading subsidiary, Consult Lhasa Limited, a company registered in England and Wales. The trading subsidiary was established to provide expert risk assessments for chemical safety that are recognised and trusted by industry and regulatory authorities. Lhasa Limited owns all the issued share capital of Consult Lhasa Limited.

Investment Policy

Lhasa Limited receives income on an annual basis through membership subscriptions, sponsorships, grants, and other sources. It plans activities over a three-to-five-year time horizon and budgets to expend all anticipated income in each year, except for retained reserves in line with the reserves policy, and provides for capital expenditure within the budget or through designated income funds.

Lhasa Limited will review and determine its investment policy and attitude to risk in consultation with its Investment Managers having regards to its objectives and operating financial conditions. Lhasa Limited has a dual objective of income and real growth.

The portfolios will target growth with the objective of protecting the capital value of the fund against inflation. Income is retained on the portfolios.

A strategy of limiting risk by matching to a degree the types of assets invested in, to the obligations or liabilities of the Fund has been adopted. The balance between investing for growth and investing for income with the best fit or match to liabilities is a judgment requiring regular reappraisal, constrained only by the requirement to achieve an average moderate risk rating.

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DIRECTORS’ AND TRUSTEES’ REPORT

Lhasa Limited recognises that the portfolios will be invested in assets that will rise and fall in value in the short term but are most likely to show a positive return over an intermediate period of time.

Lhasa Limited further recognises that investments in this area will require a minimum time horizon of five years or more.

The suitability of various types of investments has been considered, as has the need to diversify investments to reduce the risk of being invested in too narrow a range of assets. Investments in significant holdings (>10% of the portfolio) are not permitted.

These principles are reviewed annually and discussed at least quarterly at the regular review meetings between our Investment Managers and the FIC.

Lhasa Limited is keen to maintain the liquidity of its investments and so would not wish to invest in the most speculative instruments.

Lhasa Limited keeps sufficient cash separate to its investment assets to meet short-term working capital needs. Lhasa also keeps sufficient cash savings to meet mid-term cash needs. Lhasa Limited will only place funds with the Investment Managers in excess of these funds.

The FIC reviews Lhasa’s liquidity on a quarterly basis and reports back to the Board of Trustees.

Investments may be excluded if they run counter to the work of the Charity or result in loss of financial support.

Lhasa Limited appoint professional Investment Managers to manage the assets on a discretionary basis, in line with this investment policy.

The Investment Managers are responsible for monitoring their own performance and formally reporting it (in actual and comparative terms) to the FIC quarterly. The trustees have agreed with the Investment Managers that the management of the portfolio must be within detailed tactical asset allocation (TAA). Should the agreed TAA boundaries need to be deviated from, which would only be expected in exceptional circumstances, then express permission will be required by the Investment Manager from Lhasa Limited to do so.

Any changes to this allocation must be presented by the Investment Managers, the FIC or Trustees and subsequently approved.

The Investment Managers will provide quarterly information to the FIC with a minimum disclosure of: valuation of investment; annual estimated income and yield; trading activity; performance and commentary.

Performance will be measured against agreed market indices and inflation.

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

2. STRATEGIC REPORT

ACHIEVEMENTS AND PERFORMANCE

Membership

In line with the improved sponsorship income, membership levels increased from 604 in 2022 to 612 in 2023.

Vision

Lhasa supports its members and thereby benefit the wider public by helping them make informed decisions on chemical safety resulting in improved chemical safety for humans, reduced dependency on animal testing, and a greater understanding of the mechanisms that result in toxicity. It does this through the development and sharing of scientific knowledge, through the creation of predictive

models, through the assembling and curation of public experimental data and by facilitating proprietary data sharing. Lhasa Limited’s participation in the IMI eTRANSAFE project and numerous Lhasa data sharing consortia (see page 11) is a clear indication of a continuing acceptance of Lhasa Limited’s role at the heart of knowledge and data sharing in our chosen field and, as such, is in line both with our vision and our charitable objects. Furthermore, participation in projects of this type promotes further opportunities for the public to benefit from our activities as we widen our scope of influence and provide additional support for the use of computer aided reasoning in the sector.

Company Objectives & Strategy

The Board of Trustees reviews progress against the Company Objectives at each Board Meeting in the light of the prevailing operating climate and changes are made to objectives and strategies as required.

All aspects of strategy are monitored throughout the year and adjusted in the light of new market and scientific information. Changes in tactics are managed operationally and any suggested changes to strategy are recommended to the Board of Trustees. A review of strategy is made annually by the Board of Trustees with the last one taking place in September 2023.

Key Performance Indicators

The Board of Trustees task the CEO and senior management team to work to a budget, agreed annually, for income and associated expenditure in support of the charity’s aims; performance is monitored each quarter by the Trustees. Lhasa membership numbers are increasing, which supports our efforts to promote the use of computer aided reasoning in chemistry and the life sciences. In 2023 21 presentations associated with conferences, 21 publications and 15 posters were presented by Lhasa Limited staff (2022: 15 presentations associated with conferences, 14 publications and 19 posters).

Research and Development

The science team continued to maintain and develop the scientific components (data, knowledge bases, statistical algorithms) that power our existing products (Vitic, Derek Nexus, Zeneth, Mirabilis, Sarah Nexus, Meteor Nexus), in addition to progressing new scientific innovations to enhance current products or leading to the delivery of new products (Kaptis and Acrostic). Beyond solution enhancements, the science team have continued to provide scientific support for our existing and future products which included interactions with members, active participation in scientific committees and cross-industry collaboration groups, delivery of presentations, posters and publications.

Highlights for the year include:

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into Nexus to enable members to assign initial limits to nitrosamine impurities.

Toxicity prediction (Derek Nexus and Sarah Nexus)

Weight-of-evidence assessment (Kaptis)

Adverse outcome pathways (AOPs) can act as a framework to organise evidence to support toxicity risk assessments based on weight of evidence. Kaptis has been developed by Lhasa to allow safety assessors to perform weight-of-evidence assessments for complex endpoints, where combination of experimental data, predictions and knowledge are required to reach a confident conclusion. The science team continues to develop AOPs that capture established mechanisms leading to carcinogenicity, developmental/reproductive toxicity, and skin sensitisation. Through the incorporation of experimental data and reasoning rules into the AOP framework, enabled the development of a weight-of-evidence approach described in the ICH S1B addendum for assessing the carcinogenicity risk of small molecules in the pharmaceutical setting. AOPs are also providing the backdrop for many interactions and collaborations with academia, industry, and regulators.

Toxicity Data (Vitic and Lhasa Carcinogenicity Database)

Vitic continues to be our flagship toxicity database and the database continues to be expanded with a focus on genotoxicity, carcinogenicity, and skin sensitisation. In addition, the Vitic Nexus platform is continuing to support several data sharing initiatives including Aromatic Amines, Production Intermediates, Exposure Limits for Pharmaceutical Impurities (PDE), Excipients, Elemental Impurities, Nitrites and Complex Nitrosamines. The Lhasa Carcinogenicity Database was also further developed by the science team, with the curation of additional records, inclusion of features to enhance the usability of the database.

Forced degradation (Zeneth)

Zeneth continues to be developed to support members’ understanding of potential degradation pathways for drug products. The knowledge base has seen significant growth through the addition of new transformations and a wider range of excipients, many of which were requested by members. The

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knowledge base is supported with provision of physiochemical parameters to refine reasoning and enhance predictions.

Impurity tracking (Mirabilis)

Mirabilis enables users to predict whether potential impurities will be removed (purged) from pharmaceutical products during their synthesis. Such impurities can be introduced during drug synthesis and may pose a carcinogenic risk. Mirabilis has established itself as the leading tool to support use of the purge argument to satisfy option 4 of the ICH M7 guideline. The science team has helped maintain this position through supporting the implementation of a condition-based approach, which increases the confidence and robustness of reactivity predictions, as well as further development of the Mirabilis knowledge base to cover additional impurity and reaction types. The knowledge within Mirabilis continues to grow enabling coverage of additional genotoxic impurity classes.

Metabolite prediction (Meteor)

Meteor remains Lhasa’s solution for the prediction of the metabolic fate of compounds and is integrated into the Nexus platform. A metabolism database has been further developed to support improved predictivity and decision making within Meteor.

Key Collaborations

USA Food and Drug Administration Research Collaboration Agreement

The FDA RCA (Research Collaboration Agreement) allowing for research collaboration and access to Lhasa software by the FDA progressed well through 2023. The FDA also continues to provide valuable feedback/input for the further development of Mirabilis, and development of alerts in Derek Nexus related to the assessment of nitrosamines development. This project benefits the outputs of computer-aided reasoning in chemistry and the life sciences in accordance with our charitable objects by providing the regulatory feedback needed to ensure our software remains regulatory applicable and to support regulatory access to ensure public safety.

European Medicines Agency

Access to the EMA and 18 EU regulators has been provided under a collaboration agreement. Lhasa continues to provide training sessions and material, with positive feedback received for the sessions provided so far. Marketing activity is also being planned to socialise the EMA’s membership.

NIHS Japan

The Japanese NIHS continued to fund a long-standing research collaboration with Lhasa, with the focus (for 2023) on continuing the improvement of the prediction of development/reprotoxicity adverse outcome pathways which is in-line with the goal of increasing understanding of computational methods in pharmaceutical, cosmetic, personal products and chemical applications.

Lhasa sponsored data sharing projects

During 2023 Lhasa continued to drive the following data sharing projects:

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

Training

As part of the Lhasa Limited service to our members, and in support of the education of individual users at each of our member organisations, in 2023 287 training sessions were delivered overall. 49 at member sites, 237 via the web and 1 at Lhasa.

Since the pandemic, a large proportion of members are now working from home, this has impacted the number of member site training sessions. Whilst we have seen an increase (3x) from 2022 to 2023, it has not recovered to pre-pandemic numbers.

Lhasa Limited Face to Face and Virtual Events

Lhasa Limited continues to run a number of events to share knowledge and experience in chemistry and the life sciences as it applies to the future developments of the Charity’s collaborative tools. During 2023 we held 9 virtual events some of which were held in more than languages other than English, to suit our audience (attracting a total of 872 external logins and generating 264 leads to follow up with).

During 2023, we held six scientific in-person events in the USA, Europe, Brazil, Korea and Japan with 420 in-person attendees. We also held an additional three local technology events with 83 inperson attendees.

Conferences

In 2023, Lhasa Limited staff attended 28 scientific events (conferences and external webinars) in support of our aims, philosophy, services, and charitable objects.

Publications

A key part of the work of Lhasa Limited is the expansion in the understanding of toxicology, metabolism, and degradation prediction. During 2023 this objective was achieved by the delivery of 21 presentations to conferences, 21 publications and 15 posters.

Sponsorship

The Board of Trustees have approved a number of sponsorship activities in accordance with Lhasa Limited’s charitable objects including:

Member facing activity

Lhasa Limited is justifiably proud of its record of supporting members. During 2023 we continued to provide first class scientific and technical support through our strong team of Application Scientists. Our members are regularly surveyed for their views on the scientific and technical support we provide and in 2023 our approval rating was 98.8% or 5.93/6.

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3. FINANCIAL REVIEW

Funding Sources

Lhasa Limited receives the majority of its income from membership fees, software sponsorship fees and buying-in fees from members using Lhasa software for their own research and development purposes and royalty fees from consultants using Lhasa software to provide results to third parties, with the aim of attracting significant income from the additional sponsorship of specific research and development projects. The results derived from these projects are incorporated into the software available to the whole Lhasa Limited membership.

Lhasa Limited is involved in several externally funded research projects. As well as the EU and data sharing projects mentioned above, during 2023, the Charity continued to run various strategic projects, including a collaboration with Boehringer in order to store their in-house data within a bespoke version of Vitic.

Results for the year

The surplus for the financial year 2023 was £3,070k (2022 £1,293k). Income for the 2023 financial year increased as a number of new organisations bought into the database systems. The majority of existing customers renewed their membership and continued to license the software. The geographical income split for 2023 (2022) was:

Europe 39% (39%)
Americas 37% (36%)
Asia 24% (25%)

The value of the software systems owned and developed by Lhasa Limited increased during 2023 by £569k (2022: increased by £617k), a further £2,736k (2022: £737k) was invested in new product development in 2023. In 2023 Lhasa Limited continued to deliver work for the strategic projects which included eTRANSAFE which came to an end in February 2023. The capitalisation of staff effort expended in developing the database systems during 2023 was £2,044k (2022: £2,618k) which was offset by their amortisation charges during the year of £1,475k (2022: £1,264k).

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019) - (Charities SORP (FRS 102)). The notes to the financial statements on pages 27 to 47 indicate how the income totalling £18,704k (2022 £16,984k) represents the commitment of the existing customers to the Charity and each of the databases.

The expenditure has been allocated on the same basis as income across the main activities, the allocation of the costs being based on the staff hours spent on each database together with the direct costs incurred.

The governance costs totalling £79k (2022: £62k) are detailed in note 5 on page 34 and include the management time incurred in assisting the Board of Trustees to fulfil their duties.

Following the latest valuation of the USS Pension Scheme Lhasa has fully released the provision as at 31 December 2023.

The Charity has prepared a budget for the year ended 31 December 2024 which indicates an approximately break-even position for the coming year. This budget is based on identified income sources and planned costs and reflects Lhasa’s commitment to the development of new databases. This budget was approved by the Board in December 2023.

The level of income and the Charity’s year end position in 2023 were positive and very satisfactory.

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Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

4. FUTURE PROSPECTS

Income

To directly address the further development of the Charity, the Charity has released, and continues to develop, new software with an identified market to provide a broader base of support for member needs in accordance with our charitable objectives. The focus will remain on increasing value to our membership through the development of existing and new software alongside the further development of strategic, collaborative projects that meet our member’s future needs, and together will further safeguard the longer-term future of the Charity.

Income growth from core sponsorship has remained strong for 2023 at 8.3% (2022: 11.1%) representing an excellent performance which indicates that the chosen strategic direction and overall approach of the Charity is right for the current economic climate. The budgeted income growth from core sponsorship for 2024 is 5.7%. An increase of 5.0% was passed on to our members during 2023 and an average increase of 6.0% was approved by the Board for 2024 in recognition of the cumulative effects on our costs of price rises and inflation over the past few years.

Applied Sciences

Global Alliances

Global Alliance managers, working within our Applied Sciences team, provide project direction and support for our new strategic projects, consortia developments and for our relationships with regulators in Europe, the USA, Japan, and other territories.

Business Partnerships

The Business Partnerships team are focused on working with prospective members to secure sponsorship of our solutions and to extend the application to new markets and new territories.

Application Scientists

The focus of application scientists is to support our members to solve problems they have. The application scientist identifies needs and applies our solutions to meet member’s needs.

Marketing

The focus of the Marketing team is to promote our science, our solutions and the value that it can bring to members and prospects alongside other activities that support our charitable purpose.

Business Support

The focus of business support is to assist all Lhasa employees with travel, negotiate deals for conferences, hotels, events etc. The team are also involved in release activities for all our solutions and always looking for improvements by automating and making processes more effective.

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Solutions

Delivery Management

The Delivery Management team have now formed and aligned on standard practices and ways of working, which is reflected in the consistent and stable delivery of products and solutions over the past year. Development of products and solutions is now ‘continuous’, so we are not bound by artificial constraints beyond which we have to reallocate resource this can now be dynamically assigned based upon the priority and importance of the member demand.

We are moving towards a much increased release cadence, where we will deliver updates to solutions to members on a more frequent and regular cycle. This will be especially noticeable on our solutions provided as SaaS (Software as a Service).

Product Management

The role of Product Owner has now been fully established and embedded to lead the development and delivery of our solutions across the product lifecycle. Working much more closely with Application Scientists who interact with our members, with Scientists who understand our capacity and capability to deliver robust solutions to meet those needs, and with Software Developers and Architects who are responsible for delivery those solutions efficiently, with consistency and with an eye on the entire portfolio, the improvements to this role have increased the ownership and accountability of solutions within the organisation.

Science Team

The Science Team continues to deliver the necessary capacity to investigate opportunities to develop computer-aided reasoning for the life sciences outside of the general improvements delivered via operational projects.

Upon continuous review of our scientific strategy and inputs provided by the Science Advisory Board, a number of key scientific domains will continue to be supported via specific research projects:

The work of the Science Team will be applied by multidisciplinary teams to ensure the delivery of value to members through different solutions. Synergies arising from the integration of the knowledge, data and technology teams will be leveraged to increase the quality, accuracy, and transparency of scientific interpretation that the Lhasa Limited software provides for members.

Architecture

The Architecture team are supporting the effective orchestration of technical activities to deliver the best-in-class products to Lhasa’s members, maturing architectural practices will continue to ensure greater consistency and alignment of solutions against industry standards. Architectural leadership and governance will ensure cross-solution alignment supporting tighter integration, cross-product workflows, and component reuse across our product portfolio.

15

Lhasa Limited

DIRECTORS’ AND TRUSTEES’ REPORT

Software Development

Software Development teams continue to successfully develop and support multiple Lhasa solutions as well as enable Endava teams to develop Symphora and Metabolism solutions. Software Development structure evolved in 2023 to better respond to dynamic delivery demands. This included creating smaller line management teams with focus on supporting career development, addressing skills gaps, and improving retention. With rapid advancement in AI, its usage including co-pilot is under investigation to ensure it can safely be integrated into software development life cycle.

Software Development participated in Leeds Digital Festival and successfully co-hosted a number of community events to raise Lhasa’s profile as employer in tech and attract talents. This will continue in the future and is expected to enable effective recruitment and retention.

Platform Engineering continues to automate and streamline software release. As a result, Mirabilis has gained significant improvement, reducing time taken to release down from days to hours. By focusing on providing consistent, reliable, repeatable CI/CD as a service, other solution teams will similarly benefit in the future.

16

Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

5. RISK MANAGEMENT & REVIEW

The Board of Trustees is responsible for the management of risk by the Charity. Key controls for the management of risk include:

The Board of Trustees has conducted a review of the major risks to which the Charity is exposed, and systems have been established to mitigate those risks. During 2007 the Board of Trustees approved the use of Charity Magique software which is used to further identify, manage, and mitigate risks throughout the Charity’s operations. An overview of key risks is presented at each quarterly Board of Trustees meeting and the risk register is formally reviewed by the Board of Trustees on an annual basis.

Corporate Risk

The Board of Trustees meet on a regular basis to review the performance of the Charity and its activities and are provided with financial management reports and forecasts which they use to ensure proper business controls are in place. Contractual and other legal arrangements are regularly reviewed by the management team and brought to the Board of Trustees for their consideration and approval where appropriate before action. As far as the Board of Trustees are aware there are no instances of actual, suspected, or alleged fraud that will affect the Charity.

Financial Risk

With the majority of income derived from overseas sources, the risk of currency fluctuation is mitigated by our policy not to retain significant currency holdings. The foreign exchange loss in the current year is £35k compared to a loss in the prior year of £68k reflecting the movement in the currency market.

Data Loss

Lhasa has established policies and procedures which ensure all data is stored and backed up aligned to industry good practice. Lhasa operates full resilience and high availability across the networking and core infrastructure; all critical services are backed up in Microsoft Azure Cloud and immutable repositories with full business continuity failover in the event of loss or interruption to primary services, non-critical services are backed up in Synology. Lhasa also has an established Disaster Recovery & Business Continuity test and restoration schedule which ensures data can be restored from back up if and when required in very short timescales; due to Lhasa’s high availability, high dependency network infrastructure all DR & BC activity can be executed remotely without on-site presence at Granary Wharf House.

Fraud

To minimise the risk of fraud, all key financial transactions greater than £100k must be approved by two Officers of the Charity with approval from the Board for all expenditure over £250k. All signatories have clear and communicated authorisation levels.

Competitive Risk

The Charity continues to monitor the competitive risk arising from a number of different sources including direct substitution of the software provided by the Charity and the potential replacement by newer or more cost-effective technologies. In addition, to protect our existing intellectual property, we protect our company and product names by means of registration in countries in which we support our members.

17

Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

Key Risks

The primary risks for Lhasa Limited are managed and mitigated through the application of Board of Trustee approved strategies and monitored using the Charity Magique software system.

The key risks as identified by the Board of Trustees all have controls in place to mitigate any potential impact they might have. The key risks identified are:

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

The Trustees who were in office on the date of approval of these financial statements have confirmed, as far as they are aware, that there is no relevant audit information of which the auditors are unaware. Each of the Trustees has confirmed that they have taken all the steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit information and to establish that it has been communicated to the auditor.

AUDITORS

A resolution to reappoint Mazars LLP will be put to the annual general meeting.

This report was approved by the Board of Trustees on 22[nd] May 2024 and signed on its behalf.

In approving the Directors’ and Trustees’ Report, the Trustees are also approving the Strategic Report therein in their capacity as company directors.

Mr Stephen Marsland CHAIR OF TRUSTEES

By order of the Board

18

Lhasa Limited DIRECTORS’ AND TRUSTEES’ REPORT

The Trustees are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Trustees to prepare financial statements for each financial year. Under that law the Trustees have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing those financial statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

19

Lhasa Limited

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF LHASA LIMITED

Opinion

We have audited the financial statements of Lhasa Limited (the ‘parent charity’) and its subsidiary (‘the group’) for the year ended 31 December 2023 which comprise the Consolidated Statement of Financial Activities, Charity Statement of Financial Activities, Consolidated Balance Sheet, Charity Balance Sheet, Consolidated Statement of Cashflows and notes to the financial statements, including a summary of significant accounting policies.

The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

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

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

Other information

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

20

Lhasa Limited

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF LHASA LIMITED

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

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and parent charity and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report.

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

21

Lhasa Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF LHASA LIMITED

Responsibilities of Trustees

As explained more fully in the Trustees’ Responsibilities Statement, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the group’s and parent charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. Based on our understanding of the charity and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: Charities Act 2011, UK tax legislation, anti-bribery, corruption and fraud and money laundering.

To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:

We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as the Charities Act 2022, the Charities Statement of Recommended Practice, UK tax legislation, pensions legislation, employment regulation and the Companies Act 2006.

22

Lhasa Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF LHASA LIMITED

In addition, we evaluated the trustees’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to revenue recognition (which we pinpointed to the cut-off assertion), the pension deficit provision, the capitalisation of labour, the depreciation of fixed assets and the amortisation of databases, the bad debt provision and significant one-off or unusual transactions.

Our audit procedures in relation to fraud included but were not limited to:

There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

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

Use of the audit report

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

David Hoose (May 30, 2024 17:27 GMT+1)

David Hoose (Senior Statutory Auditor) for and on behalf of Mazars LLP

Chartered Accountants and Statutory Auditor

5[th] Floor 3 Wellington Place Leeds LS1 4AP

Date: 30-May-2024

23

Lhasa Limited

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING AN INCOME AND EXPENDITURE ACCOUNT) For the year ended 31 December 2023

For theyear ended 31 December 2023
Notes
INCOME
Income from investments
1
Income from charitable activities
2
Other income
3
TOTAL INCOME
EXPENDITURE
Expenditure on raising funds
4
Expenditure on charitable
activities
4
TOTAL EXPENDITURE
Net gains/(losses) on investments
10
NET INCOME AND NET
MOVEMENT IN FUNDS
Total funds brought forward at 1
January 2023
TOTAL FUNDS CARRIED
FORWARD
AT 31 DECEMBER 2023		 Unrestricted
Funds
£’000
469
18,232
3
18,704
81
16,166
16,247
613
3,070
20,631
23,701		 Restricted
Funds
£’000
-
-
-
-
-
-
-
-
-
-
-		 Total
2023
£’000
469
18,232
3
18,704
81
16,166
16,247
613
3,070
20,631
23,701		 Total (all
unrestricted)
2022
£’000
267
16,716
1
16,984
71
14,186
14,257
(1,434)
1,293
19,338
20,631

The net income for the year arises from the group’s continuing operations.

No separate Statement of Total Recognised Gains and Losses has been presented as all such gains and losses have been dealt with in the Statement of Financial Activities.

The notes on pages 27 to 47 form part of these financial statements.

24

Company Registration No. 01765239

Lhasa Limited

CONSOLIDATED AND CHARITY BALANCE SHEET As at 31 December 2023

Notes
FIXED ASSETS
Intangible
8
Tangible
9
Investments
10
CURRENT ASSETS
Debtors
11
Cash and cash equivalents
12
LIABILITIES
Creditors: Amounts falling due within
one year
13
Deferred income
14

NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT
LIABILITIES
Creditors: Amounts falling due after
more than one year
15
NET ASSETS
FUNDS
Accumulated unrestricted funds
• designated funds
16,17
• general funds
16,17
TOTAL FUNDS		 Group
2023
£’000

4,474
3,299
10,298
18,071
5,128
10,627
15,755
1,879
8,246
10,125
5,630
23,701
-
23,701
13,773
9,928
23,701		 Group
2022
£’000
3,852
3,311
9,337
16,500
4,993
11,118
16,111
1,753
8,088
9,840
6,271
22,770
2,139
20,631
8,154
12,477
20,631		 Charity
2023
£’000
4,459
3,288
10,298
18,045
5,207
10,620
15,827
1,853
8,246
10,099
5,728
23,773
-
23,773
13,747
10,026
23,773		 Charity
2022
£’000
3,852
3,311
9,337
16,500
4,993
11,118
16,111
1,753
8,088
9,840
6,271
22,770
2,139
20,631
8,154
12,477
20,631

The financial statements were approved by the Board of Trustees and authorised for issue on 22[nd] May 2024 and are signed on its behalf by:

Mr S Marsland

CHAIR OF TRUSTEES

The notes on pages 27 to 47 form part of these financial statements.

25

2

Company Registration No. 01765239

Lhasa Limited

CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 31 December 2023

2023 2022
Notes
£’000 £’000
Cash flows from operating activities 18 4,630 5,320
Cash flows from investing activities:
Interest received 271 72
Dividends received 203 195
Purchase of fixed assets (345) (272)
Purchase of investments (1,498) (1,741)
Sale of investments 1,097 843
Purchase of intangible assets (4,849) (2,628)
Net cash used in investing activities (5,121) (3,531)
Cash flows from financing activities:
Repayments of borrowing - -
Cash inflows from new borrowing
 - -
Net cash provided by/(used in) financing
activities - -

Change in cash and cash equivalents in
the reporting period		 (491) 1,789
Cash and cash equivalents at the
beginning of the reporting period		 11,118 9,329
Cash and cash equivalents at the end of
the reporting period		 10,627 11,118
Analysis of change in net cash
At 1 January
2023		 Cash flows At 31 December
2023
£’000 £’000 £’000
Cash at bank and in hand 11,118 (491) 10,627

The notes on pages 27 to 47 form part of these financial statements.

26

Lhasa Limited ACCOUNTING POLICIES

BASIS OF ACCOUNTING

Lhasa Limited is a charitable company limited by guarantee and registered in England. The registered address is Granary Wharf House, 2 Canal Wharf, Holbeck, Leeds, LS11 5PS.

The financial statements have been prepared under the historical cost convention and in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019) – (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Lhasa Limited meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note. The financial statements have been prepared in Pound Sterling as this is the currency of the primary economic environment in which the company operates.

Under s408 of the Companies Act 2006 the charitable company is exempt from the requirement to present its own Statement of Financial activities. The surplus for the year for the charitable parent company was £3,142k (2022: surplus of £1,293k)

CRITICAL ACCOUNTING JUDGEMENTS & KEY SOURCES OF ESTIMATION UNCERTAINTY In applying the company’s accounting policies, the Trustees are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The Trustees’ judgements, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results and outcomes may differ.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.

Critical accounting judgements

The critical accounting judgements that the Trustees have made in the process of applying the company’s accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below.

In assessing whether there have been any indicators of impairment in relation to assets, the Trustees have considered both external and internal sources of information such as market conditions and experience of recoverability. There have been no indicators of impairments identified during the current financial year, other than in relation to the development of new databases which have not as yet been released to Members. Those databases where the future value is not sufficiently certain to warrant capitalisation of the development costs have been expensed.

Wage costs capitalised within intangible fixed assets are based on time sheet postings made by the employee and reviewed by management which allows for the separation of time to be expensed (such as that spent on database maintenance) and time to be capitalised, for which there is considered to be future benefit (such as the input of information or the development of new functionality).

Key sources of estimation uncertainty

The key assumptions concerning the future, and other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

27

Lhasa Limited ACCOUNTING POLICIES

Where an indication of impairment exists, the Trustees will carry out an impairment review to determine the recoverable amount, which is the higher of fair value less cost to sell and value in use. The value in use calculation requires the Trustees to estimate the future cash flows expected to arise from the asset or the cash generating unit and a suitable discount rate in order to calculate present value.

The company establishes a provision for receivables that are estimated not to be recoverable. When assessing recoverability, the Trustees consider factors such as the ageing of the receivables, past experience of recoverability, and the credit profile of individual or groups of customers.

The company depreciates tangible and intangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes. Judgement is applied by management when determining the residual values for plant, machinery and equipment. When determining the residual value, management aim to assess the amount that the company would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful economic life. Where possible, this is done with reference to external market prices.

The company continually develops our database systems. This investment enables our databases to stay current both in content and delivery. Without this continual investment our databases would not provide our members with the latest research nor be accessible in an effective way as science and technology both continually change. Historic data suggests that a reasonable economic life of five years is appropriate over which to amortise our databases on a straight-line basis. This assumption is validated by an annual review of the future cash flows expected to arise from each database and, where this is not reflected in the asset value, it is impaired.

As at the balance sheet date, the company has fully released the provision in respect of the deficit of the multi-employer defined benefit pension scheme.

GOING CONCERN

Having reviewed the current working capital position, the forecast financial activity and capital commitment spend, the Trustees believe that there are no apparent reasons that the charity will not continue to operate for at least 12 months following the signing of the audit report and as such the financial statements have been prepared on the basis that Lhasa Limited is and will continue to be a going concern.

BASIS OF CONSOLIDATION

The consolidated financial statements include the financial statements of those undertakings which are owned by Lhasa Limited. Group turnover excludes transactions between group undertakings, intra group sales being eliminated on consolidation. All subsidiary company accounting periods are co-terminus with the parent company.

28

Lhasa Limited ACCOUNTING POLICIES

FUND ACCOUNTING

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objectives of the charity.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors. They include income received under contracts with members in respect of special projects where use of the income is restricted to that project. On completion of a project, the resulting data or software becomes available to the general membership and so there is no longer any restriction on the assets. At this point the value of the income relating to the completed projects is transferred from restricted to unrestricted funds.

INCOME

Income comprises:

Buying in fees

This is a one-off payment by a sponsor to buy into an existing Lhasa Limited software development project. This takes account of the investment already made in the project by the existing sponsors. This income is recognised once access to the relevant database has been granted.

Computer software sponsorship and license fees

This is an annual fee made by an organisation to fund ongoing software development projects. This income is recognised on an accruals basis in line with the period of service provided.

Subscriptions

This is an annual fee payable by an organisation to become a member of Lhasa Limited and to have access to software developed by Lhasa Limited. This income is recognised on an accruals basis in line with the period of membership.

Project sponsorship

This is income received from sponsors for specific projects which is recognised immediately, unless a contract has been entered into that specifically limits the income use.

The percentage of income arising from outside the UK was 90% (2022: 90%).

RESEARCH AND DEVELOPMENT

Expenditure, including direct staff costs attributable to the computer software, is capitalised. All other expenditure on research and development is written off in the year in which it is incurred.

FOREIGN CURRENCIES

Assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the date ruling at the date of the transaction. Exchange differences are taken into account in arriving at the operating surplus or deficit for the year.

EXPENDITURE

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to that activity. Where costs cannot be directly allocated to activities, they have been allocated to activities on a basis consistent with the use of resources.

Direct costs, including directly attributable salaries, are allocated on an actual basis to the key strategic areas of activity. Support costs are allocated on an actual basis to the key strategic areas of activity with any unallocated support costs being apportioned on an income received basis for each strategic area of activity.

Governance costs include the cost of governance arrangements which relate to the general running of the charity. These activities provide the governance infrastructure which allows the charity to operate and to generate the information required for public accountability. They include the strategic planning processes that contribute to the future development of the charity.

29

Lhasa Limited ACCOUNTING POLICIES

TANGIBLE FIXED ASSETS

Fixed assets are stated at cost less accumulated depreciation.

Assets with a cost in excess of £1,000 intended to be of ongoing use to Lhasa Limited in carrying out its activities are capitalised as fixed assets.

Depreciation is provided on all tangible fixed assets other than freehold land at rates calculated to write each asset down to its estimated residual value evenly over its expected useful life at the following rates:

Freehold properties 2%
Freehold property refurbishment 10%
Fixtures and fittings 20%
Computer hardware 25%
Office equipment 20%

INTANGIBLE FIXED ASSETS

Intangible fixed assets are stated at cost less accumulated amortisation.

Expenditure, including direct staff costs attributable to project sponsorship is either capitalised if attributable to the computer software or prepaid until the information is available to add to the software.

Assets with a cost in excess of £1,000 intended to be of ongoing use to Lhasa Limited in carrying out its activities are capitalised as intangible assets.

Amortisation is provided on all intangible fixed assets at rates calculated to write each asset down to its estimated residual value evenly over its expected useful life at the following rates:

Trademarks 10%
Databases 20%
Computer software 25%

FIXED ASSET INVESTMENTS

Listed investments are revalued to open market value on an annual basis in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities. Any gains or losses on revaluation are taken to the Statement of Financial Activities.

CASH AND CASH EQUIVALENTS

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents notice deposit accounts with terms of 125 days or less that are readily convertible to known amounts of cash with insignificant risk of change in value.

30

Lhasa Limited ACCOUNTING POLICIES

RETIREMENT BENEFITS

The charitable company participates in the Universities Superannuation Scheme. This scheme was closed to new staff members in 2015. This is a multi-employer scheme for which it is not possible to separately identify the charity’s share of the underlying assets and liabilities attributable to the scheme.

If the actuarial valuation of the scheme reveals a deficit, the Trustees will agree a recovery plan to eliminate the deficit over a specified period. This is held as a provision in the financial statements, as detailed in note 13.

The charitable company operates a defined contributions scheme on behalf of its new staff with the Aviva pension scheme.

Company contributions to both these schemes are charged to the Statement of Financial Activities in the period to which they relate.

The pension charge represents contributions payable by the charity to the funds in respect of the year, as disclosed in note 21.

TAXATION

As a charity Lhasa Limited is exempt from tax on income and gains to the extent that these are applied to its charitable objects. No tax charges have arisen in the charity.

OPERATING LEASES

Rentals paid under operating leases are charged to the Statement of Financial Activities on a straight-line basis over the term of the lease.

FINANCIAL INSTRUMENTS

The charitable company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration, expected to be paid or received.

Financial assets and liabilities are offset, and the net amount reported in the Balance Sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

31

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

1
INVESTMENT INCOME
Bank interest
Investment income
2
INCOME FROM CHARITABLE ACTIVITIES
Buying in fee

Membership subscriptions

Computer software sponsorship

Strategic projects

Subsidiary income

A geographical analysis of income is as follows:
Europe
Americas
Asia
3
OTHER INCOME
Insurance Claims

Loss on disposal of assets
CJRS grant		 2023
£’000
267
202

469

2023
£’000
282
899
16,047
910
94

18,232

2023
£’000
7,061
6,763
4,408

18,232

2023
£’000
3
-
-

3
 2022
£’000
72
195
267
2022
£’000
113
848
14,837
918
-
16,716
2022
£’000
6,478
6,004
4,234
16,716
2022
£’000
1
-
-
1

32

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

4
EXPENDITURE
Costs of generating funds:
Investment management costs

Analysis of expenditure on charitable activities:
Consultancy fees
Travel costs

Depreciation and amortisation

Impairment (reversal)/charge

Staff costs

Sales exhibition costs

Support costs (see below)

Marketing costs
Governance costs (see note 5)







2023
£’000
81
242
302
1,858
2,736
8,621
61
2,259
7
16,168
79

16,247
 2022
£’000
71
108
240
1,617
737
7,029
59
4,319
15
14,195
62

14,257

Analysis of support costs:

All support costs are allocated on the basis of income, with the exception of recruitment of direct staff which are based on the hours spent on each database. Support costs include:

Research sponsorship

Employee related costs

Premises costs

IT costs

Other costs
 2023
£’000
79
(253)
424
936
1,073

2,259
 2022
£’000
4
2,565
363
573
813

4,319

Research sponsorship represents the impact of grants awarded to institutions to sponsor PhD students in accordance with Lhasa Limited’s charitable objects. Certain of these grants span multiple accounting periods, in which case the terms of the grant dictate the accounting treatment.

33

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

5
ANALYSIS OF GOVERNANCE COSTS
Audit
Accountancy and other audit costs

Cost of AGMs and Board of Trustees’
expenses


6
NET INCOME
This is stated after charging:
Auditor’s remuneration
Depreciation
Amortisation
Impairment charge/(reversal)
Exchange (gains)/losses
Operating lease rentals:
Lease costs		 2023
£’000
29
15
35

79

2023
£’000
29
343
1,491
2,736
35
3
 2022
£’000
20
15
28

62

2022
£’000
20
342
1,275
737
(68)
3

34

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS

for the year ended 31 December 2023

7 REMUNERATION

No Trustees’ remuneration was paid in either year. Trustees’ expenses totalling £7k (2022: £4k) were incurred by the charity for 12 Trustees (2022 – 9 Trustees). The Trustees expenses related to travel, accommodation and subsistence within their role as Trustee.

The average number of employees in the year, analysed by category, is as follows:

Administration
Science
Applied Sciences
Product Management
Software Delivery
The average number of full-time equivalent number of employees
in the year was:

Wages and salaries
Social security
Pension		 2023
33
56
31
9
46

175

2023
168
2023
10,234
1,128
(779)

10,583		 2022
32
54
25
5
44

160

2022
160
2022
8,797
1,031
1,151
10,978

Total pension contributions for 2023 were £1,540k (2022: £1,151k) the USS pension provision was fully released in 2023, a decrease of £2,319k (2022: decrease of £49k).

35

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

The key management personnel are considered to be the Chief Executive Officer, Director of Applied Sciences, Director of Science, Head of Finance, Head of Information Technology, Lead Architect, Head of People and Culture, Head of Software Development, Head of Solutions, Business Improvement Manager. The total emoluments and employee benefits of the key management personnel (including employer’s National Insurance contributions and costs attributable to re-organisation) were £1,341k (2022: £1,185k).

Employees received emoluments of more than £60,000 as follows:

2023 2022
£60,000 - £70,000 26 21
£70,000 - £80,000 17 9
£80,000 - £90,000 5 1
£90,000 - £100,000 1 1
£100,000 - £110,000 1 -
£120,000 - £130,000 - 2
£140,000 - £150,000 - 1
£160,000 - £170,000 1 -

Pension contributions in respect of the above higher paid staff were £600,382 (2021: £403,381).

8 INTANGIBLE FIXED ASSETS: GROUP

Cost
At 1 January 2023
Additions
At 31 December 2023
Depreciation
At 1 January 2023
Amortisation
Impairment charge
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022		 Computer
Software
£’000
120
37
157
110
9
119
38
10		 Databases
£’000
20,631
4,780
25,411
16,821
1,475
2,736
21,032
4,379
3,810		 Trademarks
£’000
65
32
97
33
7
40
57
32		 Total
£’000
20,816
4,849
25,665
16,964
1,491
2,736
21,191
4,474
3,852

36

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

8 INTANGIBLE FIXED ASSETS: PARENT

Cost
At 1 January 2023
Additions
At 31 December 2023
Depreciation
At 1 January 2023
Amortisation
Impairment charge
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022		 Computer
Software
£’000
119
28
147
109
8
117
29
10		 Databases
£’000
20,631
4,780
25,411
16,821
1,475
2,736
21,032
4,379
3,810		 Trademarks
£’000
65
26
91
33
6
39
51
32		 Total
£’000
20,816
4,833
25,649
16,964
1,490
2,736
21,190
4,459
3,852

The direct effort in the development of Lhasa’s databases is capitalised where there is added value which adds to the economic life of the database. Lhasa tests the capitalised value annually to forecasted income to ensure that the capitalised effort does not exceed economic value.

37

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

9 TANGIBLE FIXED ASSETS: GROUP

Cost
At 1 January 2023
Additions
Disposals
At 31 December 2023
Depreciation
At 1 January 2023
Provided in year
Disposals
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022		 Freehold
Land and
Buildings
£’000
3,901
182
(407)

3,676
1,047
171
(396)
823
2,853
2,854		 Computer
Hardware
£’000
849
155

1,004
574
121
695
309
276		 Office
Equipment
£’000
276
7
283
95
51
146
137
181		 Total
£’000
5,027
344
(407)
4,963
1,716
343
(396)
1,664
3,299
3,311

9 TANGIBLE FIXED ASSETS: PARENT

Cost
At 1 January 2023
Additions
Disposals
At 31 December 2023
Depreciation
At 1 January 2023
Provided in year
Disposals
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022		 Freehold
Land and
Buildings
£’000
3,901
182
(407)

3,676
1,047
171
(396)
823
2,853
2,854		 Computer
Hardware
£’000
849
143

992
574
120
694
298
276		 Office
Equipment
£’000
276
7
283
95
51
146
137
181		 Total
£’000
5,027
332
(407)
4,951
1,716
342
(396)
1,663
3,288
3,311

38

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

10
INVESTMENTS
Listed fixed asset investments:
Share portfolio
The share portfolio comprises the following movements:
Market value at 1 Jan 2023
Additions

Disposals
Unrealised gain/(losses) on investments
Realised gain/(losses) on investments

Fund management fees
Market value at 31 Dec 2023
Historical cost at 31 Dec 2023		 2023
£’000
10,298

2023
£’000
9,337
1,498
(1,097)
672
(60)
(52)
──────

10,298
══════

9,603
══════
 2022
£’000
9,337

2022
£’000
9,920
1,741
(843)
(1,467)
34
(49)
──────
9,337
══════
9,302
══════

The cost and market value of the investments listed on a recognised Stock Exchange were £9,603k (2022: £9,302k) and £10,298k (2022: £9,337k) respectively.

2023 2022
The investments are held: £’000 £’000
In the UK 3,013 2,928
Outside the UK 7,285 6,409
────── ──────
10,298 9,337
══════ ══════

The entity holds one investment which has a market value at 31 December 2023 exceeding 5% of the value of the portfolio. The entity’s investment in Vanguard Funds Plc S&P 500 consists of 6.6% of the total market value of the investment (2022: 6.1%)

39

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS

for the year ended 31 December 2023

10 INVESTMENTS (CONTINUED)

% of
capital
held
Subsidiaries included in consolidation:
Consult Lhasa Limited
100%
11
DEBTORS
Group
2023
£’000
Trade debtors
4,150
Prepayments
413
Other debtors
256
Accrued income
309

5,128

Amounts falling due after more
than one year

Intercompany Loan
-

-
 Net liabilities
31 December
2023
£’000

Group
2022
£’000
3,689
490
183
631

4,993

-

-
 at

Loss for the
year ended 31
December
2023
£’000
72
72


Charity
2023
Charity
2022
£’000
£’000
4,076
3,689
391
490
431
183
309
631

5,207
4,993

150
-

150
-

40

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS

for the year ended 31 December 2023

12
CASH
Cash
Cash equivalents
 Group
2023
£’000
6,575
4,052

10,627
 Group
2022
£’000
5,428
5,690

11,118
 Charity
2023
£’000
6,568
4,052

10,620
 Charity
2022
£’000
5,428
5,690
11,118

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents represent notice deposit accounts with terms of 125 days or less that are readily convertible to known amounts of cash with insignificant risk of change in value.

13 CREDITORS

Trade Creditors
Other tax and social security
Other creditors
Accruals
Pension deficit provision		 Group
2023
£’000
207
267
305
1,100
-

1,879
 Group
2022
£’000
118
264
466
725
180

1,753
 Charity
2023
£’000
207
267
305
1,074
-

1,853
 Charity
2022
£’000
118
264
466
725
180
1,753

41

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

Lhasa Limited

14 DEFERRED INCOME: GROUP AND COMPANY

Deferred income in the year relates to monies invoiced in the year for subscriptions, knowledge contributions and licences which relate to subsequent years.

Deferred income as at 1 January 2023
Invoiced during year
Deferred income as at 31 December 2023
Income for the year
15
CREDITORS: GROUP AND COMPANY
Amounts falling due after more than one year:
Pension deficit provision

 2023
£’000
8,088
17,420
(8,245)

17,263
2023
£’000
-

-

 2022
£’000
6,691
17,195
(8,088)
15,798
2022
£’000
2,139

2,139

Included within creditors due after more than one year is the multi-employer defined benefit pension scheme deficit and the estimated employer debt. Following the valuation of the scheme as at 31 March 2023 the provision has been fully released. As of the balance sheet date the estimated discounted employer deficit is detailed below.

Pension deficit provision as at 1 January 2023
Provision made/(released) in the period
Pension deficit provision as at 31 December 2023
Less: amount due within one year		 2023
£’000
2,319
(2,319)

-
-

-		 2022
£’000
2,309
10
2,319
(180)
2,139

42

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

16 RESERVES


RESERVES
At 1 Net gains Transfer At 31
January Income Expenditure on between December
2023 investments Funds 2023
£'000 £'000 £'000 £'000 £’000 £’000
Unrestricted
funds - general		 12,477 18,649 (11,645) 613 (10,096) 10,026
Unrestricted
designated funds		 7,163 (4,580) - 5,192 7,747
– fixed assets
Unrestricted
designated funds
– closed pension		 (2,319) 2,319 -
deficit fund
Unrestricted
designated funds
– closed pension		 3,310 (2,214) 4,904 6,000
deficit fund

Parent Charity		 20,631
 18,649
 (16,120)
 613
 -
 23,773
Subsidiary
Contribution		 -
 55
 (127)
 -
 -
 (72)
Group Total 20,631
 18,704
 (16,247)
 613
 -
 23,701

43

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

Designated funds are general funds that the Trustees have chosen to use for a specific purpose, as detailed below:

Fixed asset fund – represents the net book value of intangible and tangible fixed assets totalling £7,747k (2022: £7,163k).

Closed pension deficit fund – this represents the value of the pension deficit provision.

Development Fund – this represents funds set aside for further development of charitable objectives over the next 3 to 5 years.

17 ANALYSIS OF NET ASSETS BETWEEN FUNDS

As at 31 December 2023
Fixed assets
Net current
assets
Long term
creditors
£’000
£’000
£’000
Unrestricted funds – general
4,298
5,728
Unrestricted designated funds –
fixed assets
7,747
Unrestricted designated funds –
closed pension deficit fund
-
-
Unrestricted designated funds –
future development designation
6,000



Total unrestricted
18,045
5,728
-
Restricted
-
-
-



Parent Charity
18,045
5,728
-



Subsidiary Contribution
26
(98)
-



Group Total
18,071
5,630
-



As at 31 December 2022
Fixed assets
Net current
assets
Long term
creditors
£’000
£’000
£’000
Unrestricted funds – general
6,027
6,450
Unrestricted designated funds –
fixed assets
7,163
Unrestricted designated funds –
closed pension deficit fund
(180)
(2,139)
Unrestricted designated funds –
future development designation
3,310


Total unrestricted
16,500
6,270
(2,139)
Restricted
-
-
-


Total
16,500
6,270
(2,139)		 Total
£’000
10,026
7,747
-
6,000

23,773
-

23,773

(72)

23,701
Total
£’000
12,477
7,163
(2,319)
3,310

20,631
-

20,631

44

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS

for the year ended 31 December 2023

18 CASH FLOWS 2023 2022
£’000 £’000
RECONCILIATION OF NET INCOME TO NET CASH
INFLOW FROM OPERATIONS
Net income 3,070 1,293
Investment income (473) (267)
Depreciation 345 342
Amortisation 1,490 1,275
Impairment charge 2,736 737
(Profit)/Loss on disposal of fixed assets 11 -
(Increase)/decrease in debtors (135) (547)
Increase/(decrease) in creditors (1,854) 1,005
(Gain)/Loss on investments (612) 1,433
Investment management fees 52 49
Net cash provided by operating activities
4,630 5,320

19 OPERATING LEASE COMMITMENTS

At 31 December 2023 the company had the following commitments under non-cancellable operating leases in respect of assets:

Within 1 year
Between 2 and 5 years		 2023
£’000
4
6

10
 2022
£’000
3
8

11

20 LIABILITY OF MEMBERS

Lhasa Limited is a company limited by guarantee. The company has 604 members and joint liability under guarantee is limited to £10 per member.

45

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS

for the year ended 31 December 2023

21 PENSION FUND

Employees of this company, together with other University entities participate in the Universities Superannuation Scheme. This is a defined benefit scheme and the rules require a full actuarial valuation of the Fund at intervals of not less than three years and six months. The assets of the Scheme are held in a separate Trustee administered fund. The Universities Superannuation Scheme is a multi-employer scheme for which it is not possible to separately identify the share of the total underlying assets and liabilities attributable to this particular company.

The latest actuarial valuation of the Universities Superannuation Scheme was carried out as at 31 March 2023. The valuation at 31 March 2023 shows that the market value of the total assets held by the University Scheme was £73,100m and that the actuarial valuation of these assets represented 111% of the amount of the liabilities of the scheme. Contributions by participating employers are at the rate of 21.6% up to December 2023 then from January 2024 14.5% of salaries. The next full actuarial valuation is due as at 31 March 2026.

The basis of the valuation was from the long-term yield on Government bonds in the market at the valuation date and the significant assumptions underlying the valuation were that the investment return would be 3.7% pa, and that salary increases would be CPI +3.0%

During the year the company made contributions for the year, in respect of its eligible employees, totalling £829,598 (2022: £578,385) excluding the decrease in pension deficit provision of £2,319,119 which was fully released in the year (2022: decrease of £48,889).

Pension contributions were made in respect of 197 (2022: 189) employees in the year.

The Charity also operates a defined contribution pension scheme. The cost for the year represents the Charity’s contributions to the scheme of £710,410 (2022: £572,188). There were no contributions payable to the scheme at the year end (2022: £nil).

46

Lhasa Limited

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2023

22 RELATED PARTY DISCLOSURES

Lhasa Limited charged the following costs to Consult Lhasa Limited: Software and Royalty Fees £34,909, Staff and Facilities recharges £53,606 and Loan Interest £4,528. The balance outstanding to Lhasa Limited at 31 December 2023 for invoiced transactions was £24,521.

A summary of the subsidiary’s trading results is shown below:

Turnover
Cost of sales
Gross profit
Administrative expenses
Loss on ordinary activities
The assets and liabilities of the subsidiary were:
Fixed assets
Current assets
Current liabilities
Debtors due after one year
Share capital
Profit and loss account		 2023
£’000
94,270
(53,512)
40,758
(113,237)

(72,479)

25,988
102,543
(51,009)
(150,000)

(72,479)

1
(72,480)

(72,479)

Debtors due after one year includes a loan of £150,000 from the Parent charity to the subsidiary, the amount outstanding at 31 December 2023 is £150,000. Interest is charged on the unpaid principal at the rate of 2% plus Bank of England Base Rate per annum.

47