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2021-03-31-accounts

LLGC NLW LLYFRGELL GENEDLAETHOL CYMRU THE NATIONAL LIBRARY OF WALES ANNUAL ACCOUNTS 2020-21

Contents

Contents
Page
Reference and Administrative Details 1-2
Trustees’ and Accounting Ofcer’s Annual Report
Governance statement (including structure and 3-12
management)
Objectives and Activities 13-14
Achievement and Performance 15-17
Financial Review 18-20
Sustainability Report 21
Policies relating to staf 22
Plans for future periods 23-25
Statement of Board and Librarian’s Responsibilities 26
The Certifcate and Report of the Auditor General for Wales 27-30
to the Senedd
Statement of Financial Activities 31
Balance Sheet 32
Cashfow 33
Notes to the Financial Statements 34-56

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REFERENCE AND ADMINISTRATIVE DETAILS

The Trustees (for the purpose of charity law) who served during the year and since the year end:

Ministerial Appointees:

Meri Huws (Vice President and Interim President from 1 April 2020) Vice President - vacant The Lord Aberdare (to 31 March 2021) Dr Elizabeth Siberry (to 31 March 2021) Steve Williams (to 31 March 2021) Michael Cavanagh Quentin Howard Carl Williams David Hay (from 1 April 2021) Lydia Rumsey (from 1 April 2021) Dr Janet Wademan (from 1 April 2021)

National Library Appointees:

Lee Yale-Helms (Treasurer) D. Hugh Thomas (to 31 March 2021) Gwilym Dyfri Jones (to 31 March 2021) Eleri Twynog Davies (to 30 June 2021) Dr Gwenllian Lansdown Davies Dr Anwen Jones Dr Elin Royles Susan Davies (from 1 April 2021) Professor Elaine Treharne (from 1 April 2021) Peter Florence (from 1 July 2021)

Members of the Executive Team as at 31 March 2021:

Chief Executive and Librarian and Accounting Officer

Pedr ap Llwyd

Director and Deputy Chief Executive and Librarian (Corporate Resources)

David H Michael

Director and Deputy Chief Executive and Librarian (Collections and Public Programmes)

Dr Owain Rh Roberts

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Advisers:

Bankers National Westminster Bank, Aberystwyth Solicitors Geldards LLP, Cardif Humphreys Roberts & Bott, Aberystwyth Hugh James, Cardif External Auditors Audit Wales, Cardif Internal Auditors Welsh Government Internal Audit Service Investment Brokers Investec Wealth and Investment, London

Actuarial and Pension Advice Willis Towers Watson, Edinburgh Registered Charity No. 525775 VAT no. 905194137

Registered Address: National Library of Wales Penglais Aberystwyth Ceredigion SY23 3BU Corporation Tax: The Library is exempt from Corporation Tax under Section 505 of the Income and Corporation Taxes Act 1988

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TRUSTEES’ and ACCOUNTING OFFICER’S ANNUAL REPORT

1 GOVERNANCE STATEMENT 2020 - 2021

1.1 Statutory Background and Governing Document

The National Library of Wales (‘the Library’) was established by Royal Charter on the 19th of March 1907. Supplemental Charters were granted in 1911 and in 1978, with slight constitutional revisions. On the 19th of July 2006 a new Supplemental Charter was granted by Queen Elizabeth II. The 2006 Supplemental Charter changed the Library’s constitution and governance significantly and recognised devolution of government from Westminster to Wales. Whereas previously the Library had a Court of Governors and a Council, it now has a Board of Trustees.

The National Library of Wales is also a Registered Charity (number: 525775) and a Welsh Government Sponsored Body (WGSB). It is funded by a combination of grant in aid allocated by Welsh Government, and income secured through its commercial, fundraising and charging activities. An annual remit letter from the Deputy Minister with responsibility for the Library sets out the Library’s grant in aid allocation and conditions.

Its dual nature as a Royal Charter foundation and a Registered Charity, and also a Welsh Government Sponsored Body governs how it operates and fulfils its role and obligations, which require a delicate balance between pursuing and fulfilling (a) the ‘objects’ of its Charter and Charitable status, which reflect its foundation purpose, and (b) the principles of arms-length government. These objects are “to collect, preserve and give access to all kinds and forms of recorded knowledge, especially relating to Wales and the Welsh and other Celtic peoples, for the benefit of the public, including those engaged in research or learning.”

1.2 Scope of Responsibility

The Chief Executive and Librarian is the Accounting Officer, and together with the Board of Trustees, has joint responsibility for maintaining a sound system of internal control that supports the organisation’s aims and objectives whilst safeguarding the public funds and assets for which they are personally responsible, in accordance with the responsibilities assigned to them.

The respective responsibilities of the Deputy Minister, Sponsor Department (CyMAAL), the Board of Trustees and its President, and the Chief Executive and Librarian are outlined in the Framework Document drawn up by the then Museums Archives and Libraries Division (MALD) in 2010 which regulates the relationship between the Welsh Government and the Library. A revised Framework Document will be published in 2021.

The role of the Board is to provide efective leadership, defining and developing strategic direction, setting challenging objectives, promoting high standards of public finance, ensuring that the Library discharges its functions efectively and efficiently, and monitoring performance, including the performance of the Chief Executive and Librarian, to ensure that the Library fully meets its aims, objectives and performance targets and delivery against plans and budgets. Trustees are required to act solely in the interest of the charity, and are not currently remunerated. However, following a decision taken by the Board of Trustees in February 2020, the post of President will be remunerated from 1 April 2021, however Meri Huws has indicated that she will not be accepting remuneration while serving as Interim President.

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The President is the primary communicator between the Board and the Deputy Minister and it is the President’s role to ensure that other Board members are kept informed of all such communications. It is also the President’s responsibility to ensure that the Board’s policies and actions support the Deputy Minister’s wider strategic policies and that its afairs are conducted with probity.

As Accounting Officer, the Chief Executive and Librarian is personally responsible for stewardship of the public funds for which he has charge, for day to day operations and management of the Library and for ensuring compliance with Managing Welsh Public Money (January 2016). The role and special responsibilities of the Accounting Officer are also delineated in this document.

1.3 Corporate Governance Framework

Minor revisions were made to both the Corporate Governance Framework and the Regulations during 2020, and these were adopted by the Board in November 2020. The Corporate Governance Framework lays down the key responsibilities of the Board of Trustees and Executive Team of the Library, the Board’s powers of delegation and the conduct expected of the Board; the Governance Framework also incorporates the Trustees’ Code of Conduct. The Regulations lay down the proceedings of the Board and its Committees.

1.4 Recruitment and appointment of Trustees

The Library’s Board consists of 15 Trustees, eight of whom are appointed by the Welsh Government and seven by the Library. The Trustees include the Library’s three Officers - the President, the Vice-President and the Treasurer. The President and Vice-President are appointed by the Welsh Government and the Treasurer is appointed by the Library. Trustees are appointed in accordance with the Library’s Statutes and Regulations, and the principles of open selection as recommended by the Nolan Review.

Owing to the COVID-19 pandemic which saw the Public Bodies Unit suspend public appointment campaigns until September 2020, the Library, at the request of Welsh Government, agreed to extend those ministerial appointees whose terms of office were ending in October 2020, and also those ending in January 2021, until 31 March 2021, namely Lord Aberdare, Dr. Elizabeth Siberry and Steve Williams. The Library also extended the terms of Library appointed Trustees accordingly, namely Hugh Thomas and Gwilym Dyfri Jones.

In October, the Library worked closely with the Public Bodies Unit and Sponsor Body on a recruitment campaign to appoint a Vice President, three Welsh Government appointed Trustees, and two Library appointed Trustees. Owing to the low level of applicants for the post of President, Welsh Government extended Meri Huws’ appointment as interim President until September 2021, which has since been extended to the end of March 2022, owing to the Senedd election, and to allow sufficient time to run another recruitment campaign.

We welcome Professor Elaine Treharne, Lydia Rumsey, Dr Janet Wademan, Susan Davies and David Hay who were successfully appointed as Trustees, and took up their duties on 1 April 2021. We also welcome Peter Florence, who took up his duties on 1 July 2021.

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We thank the outgoing Trustees for their dedicated service to the Library, and for agreeing to their tenures being extended for a period to ensure continuity for the Library at an especially challenging time as it faced the challenges of the COVID19 pandemic.

The Treasurer’s current term of office was due to expire on 31 July 2021, however to ensure continuity at a challenging time, the Board agreed at its meeting on 26 March 2021 to extend his tenure for a further two years until 31 July 2023, in accordance with the Library’s Statutes.

1.5 Trustee induction and training

During the year, the Trustee’s Handbook was updated to include the revised Corporate Governance Framework and Regulations and also an amended Charity Governance Code.

Owing to the COVID-19 pandemic, training took place online, and Trustees participated in webinars on managing charity governance, operations and finance, and also one on managing the workforce during a crisis and an overview of Trustees’ duties.

One to one training on the presentation of the Management Accounts and the Annual Accounts was also delivered by the Library’s Head of Finance and Enterprise.

In November 2020, the Board approved a training programme for 2021/22 which includes induction training for new Trustees and ongoing training for existing Trustees, which will be operational from April 2021.

1.6 The Board and its Committees

The COVID-19 pandemic meant that meetings had to be held online, and the Board of Trustees held the first such meeting on 1 May 2020, with full simultaneous translation. This change also meant that Board papers, for the first time, were circulated electronically to all Board members, either via the dedicated Board portal, or via the Library’s Teams. The Board held its scheduled six meetings during the year, and an additional 2 extraordinary meetings; the meeting on 4 June 2020 was held specifically to discuss the outcomes of the Tailored Review report, while the additional meeting on 10 February 2021 was held specifically to discuss the Library’s position following receipt of an additional £2.25m funding from Welsh Government.

Members of the Board of Trustees have responsibility for approving the organisation’s Strategic and Operational Plans, its Annual Report and Accounts and its Annual Budget. The three Standing Committees discuss Library business as set out in the terms of reference for each Committee, and make recommendations to the Board of Trustees on action to be taken. The responsibility for decision making rests with the Board of Trustees. The Chief Executive and Librarian, and both Deputies, attend all Board and Committee meetings.

Board agendas and minutes are published and made available on the Library’s website, together with a summary of papers presented at Board meetings. - - https://www.library.wales/about nlw/governance/nlw governance

Board members’ biographies can be seen at;

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- - - https://www.library.wales/about nlw/governance/nlw governance/board members

Committee Structure

----- Start of picture text -----
Committee Key responsibilities
A standing Committee which encompasses all the assurance
Audit and needs of the Board of Trustees and Accounting Officer in their
Risk responsibilities for issues of finance, risks, internal control and
governance. The Committee also engages with the work of
Internal and External Audit and financial reporting issues.
A standing Committee which encompasses all the governance
Governance and performance monitoring needs of the Board of Trustees
and and Executive by monitoring service delivery and
Performance performance and reviewing policies and procedures.
A standing Committee which encompasses the financial
Financial performance monitoring needs of the Board of Trustees and
Planning Executive, in particular the Library’s investment portfolio and
the use of the its private funds, its commercial activities, and
the performance of its fundraising campaigns.
----- End of picture text -----

Board and Committee Membership

Current Expires Board Audit and Gov. & Financial
term Risk Performance Planning
Meri 1st 31.08.202 Interim - Chair -
Huws 3 Preside
nt
Lee Yale- 1st 31.07.202 Treasur Ex - Chair
Helms 1 er ofcio
(extende member
d until
31.07.202
3)
Hugh 2nd 31.10.202 Member Chair - -
Thomas 0
(extende
d until
31.03.202
1)
Lord 2nd 31.10.202 Member - - -
Aberdare 0
(extende
d until

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31.03.202
1)
Elizabeth 1st 31.10.202 Member - Member -
Siberry 0
(extende
d until
31.03.202
1)
Gwilym 1st 31.01.202 Member - Member Member
Dyfri 1
Jones (extende
d until
31.03.202
1)
Steve 1st 31.01.202 Member Member - -
Williams 1
(extende
d until
31.03.202
1)
Eleri 1st 30.06.202 Member - Member -
Twynog 1
Davies
Mike 1st 31.08.202 Member Member - -
Cavanag 3
h
Quentin 1st 31.08.202 Member - - Member
Howard 3
Carl 1st 31.08.202 Member - - Member
Williams 3
Anwen 1st 29.02.202 Member - - -
Jones 4
Elin 1st 29.02.202 Member Member - -
Royles 4
Gwenllia 1st 29.02.202 Member - - -
n 4
Lansdow
n Davies

In addition to the standing committees, the Board has also established a Buildings Advisory Panel to oversee the capital building programme at the Library. The Panel was chaired by Dr Liz Siberry, Trustee until 31 March 2021, and Mike Cavanagh was appointed Chair with efect from 1 April 2021.

The following Trustees were elected to serve on the Pensions Fund Board – Carl Williams (May 2020), Anwen Jones (July 2020) and Meri Huws (September 2020).

A register of Board member’s interests is maintained by the Corporate Governance Manager, and is open to inspection at the Library on application. Completed declaration of interests forms for 2021 have been included in the register.

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Board and Committee Attendance

Board Audit and Governance Financial
Risk & Planning
Performance
Meri Huws 8/8 4/4
Lee Yale- 8/8 3/3 7/7
Helms
Lord 8/8
Aberdare
Hugh 6/8 2/3
Thomas
Elizabeth 8/8 3/4
Siberry
Gwilym Dyfri 8/8 3/4 6/7
Jones
Steve 7/8 3/3
Williams
Eleri Twynog 7/8 3/4
Humphries
Mike 8/8 1/3
Cavanagh
Quentin 8/8 7/7
Howard
Carl 5/8 6/7
Williams
Anwen Jones 6/8
Elin Royles 7/8 2/3
Gwenllian 8/8
Lansdown
Davies

*The interim Chair attends meetings of the Audit and Risk Committee and Financial Planning Committee as an observer.

Audit and Risk Committee

In accordance with Library Regulations and best practice the Audit and Risk Committee includes two independent members, Rhian Evans and Janet Wademan, who were both appointed in May 2020 following an open selection process. Both members took up their positions on 1 June 2020 and appointed to serve for a period of four years.

The Library’s internal auditors and representatives from Audit Wales also attend Committee meetings. The Library’s sponsor division, CyMAAL, reserves the right for a representative to attend one meeting a year.

The Audit and Risk Committee kept the management of risk, and the Library’s main strategic risks, under careful scrutiny throughout the year, and at the request of the Chair of the Audit and Risk Committee, the Corporate Risk Register

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is now presented to the Board of Trustees at each meeting, following its review and revision by the Committee.

Elin Royles was appointed to the Committee in June following her Board appointment.

The Committee met three times during the year, with the meeting on 17 April 2020 being cancelled, and business carried forward to the next scheduled meeting.

Financial Planning Committee

The Committee devoted considerable time during the year in scrutinising and reviewing the financial plans and budgets prepared by the Executive Team in light of the COVID-19 pandemic, and implications on the Library’s financial stability. Also discussed at length were the Library’s Pension Scheme, and the options available for changing the current scheme or moving to an alternative scheme, and also the Library’s revised redundancy terms.

The Committee also considered any requests for use of the Library’s private funds and made recommendations accordingly to the Board of Trustees on whether these should be approved.

In addition to its four scheduled meetings, the Committee held three extraordinary meetings during the year to discuss specific matters as they arose. The meeting on 14 August 2020 was held to specifically discuss the Library’s proposed revised redundancy scheme ahead of the corporate restructuring exercise, while the meeting on 9 February 2021 was held to discuss the implications of the receipt of additional funding of £2.25m allocated to the Library by Welsh Government, and the conditions pertaining to the allocation of that funding. Discussions at the third extraordinary meeting on 22 March centred around an outline costed plan for the implementation of the Tailored Review recommendations and a draft revised budget for 2021/22.

Governance and Performance Committee

This Committee had not met regularly during 2020, until the Interim President took the Chair in September.

The main area of scrutiny for this Committee during the remainder of 2020 was the Tailored Review and its Operational Plan, a plan jointly drafted by the Library and Welsh Government to implement the recommendations and findings of the Tailored Review published in 2020.

In addition to the three scheduled meetings held during the year, an extraordinary meeting of the Committee was held on 19 March 2021 specifically to discuss the governance implications of the receipt of the additional funding allocated to the Library by Welsh Government in February 2021, and the conditions pertaining to the allocation of the funding.

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The Committee also scrutinised in detail the performance indicators for 2020/21, discussed the amendments to the Corporate Governance Framework and Regulations, and the Trustees’ training programme for 2021/22.

1.6 Board Performance

Appraisals of Board members were undertaken by the Interim President during January 2021, and the interim President’s appraisal was undertaken by the Director of CyMAAL, also in January 2021. The Board had previously postponed undertaking an assessment of its own efectiveness as it awaited the publication of the Tailored Review Report. Following the publication of that report, which recommended that the Board assess its own efectiveness and that of its committees every three years, undertaking regular skills assessments and development evaluation, this will now be considered during 2021.

The Board is satisfied that it is provided with timely and accurate information for areas for which they are responsible, and considers that the quality and quantity of information provided is sufficient for it to conduct its role.

In addition to receiving the minutes of each meeting of the Audit and Risk Committee, Financial Planning Committee and Governance and Performance Committee, the Board also received minutes of each meeting of the Buildings Advisory Panel.

The Board also received reports on strategic and financial performance, risk management, the Library’s investments, Pension Scheme and progress reports against the targets set in the annual operational plan.

In addition to standing items, the following significant issues were also considered by the Board during the year:

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1.7 Internal Audit

The Library continued to work closely with its internal auditors, Welsh Government’s Internal Audit Service. The internal audit is provided by the Welsh Government Internal Audit Service in compliance with the Public Sector Internal Audit Standards. A programme of work for 2021/22 has been agreed and approved by the Audit and Risk Committee. Owing to the COVID-19 pandemic, audits during 2020/21 were carried out remotely.

The internal audit service reports independently on an annual basis on the adequacy and efectiveness of the Library’s system of internal control, together with recommendations for improvement. Regular internal audit reports are presented to the Audit and Risk Committee to allow members to review and challenge assurance statements and other evidence provided by management. The Head of Internal Audit can provide reasonable assurance that arrangements to secure governance, risk management and internal control, within those areas under review, are suitably designed and applied efectively. Some matters require management attention in control design or compliance with moderate risk exposure until resolved.

The following internal audits were presented to the Committee during 2020/21:

All the above audits received a reasonable assurance rating, with the exception of the Corporate Records Management Audit, which received a limited assurance rating. Management actions were agreed for the latter audit, and the Committee has received assurance that significant steps have been taken to address all the actions contained in the audit.

1.8 Code of Best Practice on Governance

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As far as the Board of Trustees and Accounting Officer are aware, there is no relevant audit information of which the Library’s auditors are unaware. The Board and Accounting Officer have also taken all necessary or required steps to make themselves aware of relevant audit information and to establish that the Library’s auditors are aware of that information. The Library has acted in accordance with the Good Governance Code: A Code for the Third Sector in Wales and the Board of Trustees have ensured, again in accordance with this particular code of practice, that the Library has robust governance arrangements in place to promote high performance and safeguard propriety and regularity.

As a Registered Charity, the Library has acted in accordance with the Good Governance Steering Group’s Charity Governance Code and the Charity Commission’s The Essential Trustee (CC3) guide and codes of practice.

1.9 Risk Management and Controls

The Library’s system of internal control as laid down in its Assurance Framework relating to Risk Management is based on an on-going process designed to identify and prioritise the risks to the achievement of its Strategy and annual Operational Plan; to evaluate the likelihood of those risks being realised and their potential impact; and to manage them efficiently, efectively and economically. A revised Assurance Framework was presented to the Audit and Risk Committee for consideration in April 2021.

The Corporate Risk Register identifies, documents, assesses and considers the key strategic and operational risks relating to the Library’s activities. These are kept under constant review by the Executive Team and other assigned risk owners and action is taken as appropriate to manage and mitigate these risks. Staf are informed of their duties in relation to risk management through the Core Brief, (a means of communicating key corporate messages to staf), and encouraged to contribute to the process.

No new risks were included during the year, but the efect of the COVID-19 pandemic was closely monitored and scrutinised at each Audit and Risk Committee meeting, and scoring adapted to reflect the constantly changing circumstances. Cyber Security is another area which has come under close scrutiny during the past year and the Audit and Risk Committee have resolved to undertake an internal audit in this area during 2021 to gain assurances that the Library has appropriate mitigations in place.

Following recommendations made by the Audit and Risk Committee, residual risk score and suggested target risk score are now included on the Risk Register.

The Library remains cautious in its approach to managing risk in terms of its responsibilities as a publicly funded body, and in areas such as compliance with legislation or conditions imposed by the Welsh Government, it will always seek to comply without exception. The most significant future risk to the Library relates to the possibility of further reductions in Welsh Government Grant-in-Aid as a

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result of future pressures on UK public expenditure, especially in the light of the current COVID-19 crisis, to a level where the Library is unable to deliver its objectives.

In implementing its statutory obligations and in particular the Well-Being of Future Generations (Wales) Act 2015, the Library continues to be committed to not only provide services which fulfil present needs, but which also safeguard future generations and their needs by means of its Well Being Statement and Guidelines.

The Office of the Commissioner for Well Being of Future Generations has informed the Library that the revised programme for the National Broadcast Archive Project is to be highlighted in a published case study illustrating how the revised changes to the programme respond positively and constructively to the requirements of the Act.

The Library is also embarking on an ambitious decarbonisation programme which aims to see the Library achieving an 80% carbon reduction by 2030.

The Library was certified annually for Cyber Essentials, Cyber Essentials+ and IASME until 29th November 2020. The re-certification process was delayed until March 2021 due to changes in priorities and resources caused by the pandemic. The process and requirements to re-certify are fully underway. All information security incidents were fully reported to the Executive and Audit and Risk Committee, and dealt with internally. There were no security breaches which required reporting to the Information Commissioner.

COVID-19

Following the lockdown which saw the Library having to close its doors to the public on 17 March 2020, it reopened to readers on 1 September 2020 on a pre booking basis, and with a restricted service. Those staf who had been identified as being unable to work from home during the pandemic began a gradual return to the Library on 20 July.

The Library was again forced to close its doors on 18 December 2020 during the second lockdown, and has reopened again to readers and staf following the Easter break in April 2021, when restrictions were lifted.

Signed on behalf of the Board:

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Pedr ap Llwyd

Lee Yale-Helms

Librarian & Chief Executive & Accounting Officer 23 July 2021 23 July 2021

Treasurer

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2 OBJECTIVES AND ACTIVITIES

2.1 Primary objectives

The Library’s primary objective, as expressed in Supplemental Charter 2006 is:

The fundamental purpose and vision was to ensure that the unique history, culture and heritage of Wales, which has been documented in various forms and media over the years, is available at all times to enable everyone to obtain a better understanding of who we are, to explain the historic and cultural heritage that has shaped us as a nation over the centuries, and to encourage learning and research. It has two dimensions - a splendid physical building, in Aberystwyth, housing the print, manuscript, visual and audio-visual collections and also a library and archives, as well as a digital presence on the internet.

2.2 Public Benefit

Our vision ‘to deliver change for the better for everyone in Wales now and in the future’, as stated in our new Strategic Plan for 2021-26, ensures that public benefit is at the core of all our activities.

In fulfilling their duties, the Trustees have complied with section 2 of the Charities Act 2011 by having due regard to the guidance published by the Charity Commission on public benefit. While our main beneficiaries are people living in Wales, the Strategic Plan ‘A Library for Wales and the World’ also emphasises our global impact both as a cultural destination for visitors and through our services to online users worldwide.

2.3 Main Activities

Our main activities are as follows:-

2.3.1. Collecting:

Collecting materials by legal deposits, purchases, donations, bequests, exchanges, and deposit, according to agreed collection development policies. This function is carried out through:

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2.3.2. Preserving and Conserving:

Preserving and conserving the collections. This function is carried out through:

2.3.3. Providing access and information:

Providing suitable/effective public access to the Library building, its collections and services, and information about them. This function is carried out through:

2.3.4 Publicising and interpreting:

Raising awareness of, and disseminating knowledge of, the Library’s work and collections. This function is carried out through:

2.3.5.Professional collaboration:

Collaborating with, and sometimes leading, related professional groups, across and beyond Wales. This function is carried out through:

Support functions:

The core functions are supported by essential management and business functions, including: managing and developing staf; controlling and being accountable for financial resources and income generation; and maintaining and developing ICT infrastructure and the Library’s building and facilities.

These are the main activities undertaken to further the charity’s purposes for the benefit of the public in Wales.

The Library submits an Annual Operational Plan to the Welsh Government on how the activities will be delivered and targets against these activities. Further details regarding how this strategy is derived and carried out are included in section 7.

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3. ACHIEVEMENT AND PERFORMANCE

3.1 Key highlights in 2020/21

The coronavirus pandemic had a significant impact on the work of the Library during 2020/21 with the building closed to staf and researchers and visitors for extended periods. However, the pandemic presented many opportunities and there have been significant achievements in many areas during the year in particular:

3.1.1 National Broadcast Archive Project

The project to establish a National Broadcast Archive was launched in July 2019. This exciting and pioneering 5-year project worth over £9m will establish a National Broadcast Archive for Wales, the first national broadcast archive in the UK. The project was remodelled during 2020-21 to respond to the coronavirus pandemic and other opportunities. It will enable the public to access the wealth of broadcast material online and at a host of new centres across Wales, enabling the public to view, listen, and enjoy this entire collection, alongside ITV Wales and NLW’s audiovisual collection.

3.1.2 Online Events Programme

In response to the COVID-19 lockdown the Library launched an online events programme that allowed the Library to reach a wider audience, invite a broader range of speakers and contributors and to collaborate with a number of external partners.

3.1.3 Development of the Library Building

Throughout the pandemic, the iconic Library building in Aberystwyth has undergone an extensive refurbishment programme thanks to capital funding provided by the Welsh Government. In addition to refurbishment there is a renewed focus on developing the Library building to attract and welcome visitors. During 2020-21 we saw the refurbishment of the Gregynog Gallery.

3.1.4 Online Exhibitions

A digital exhibition of First World War portraits by DC Harries was published in time for Remembrance Sunday 2020. The Paul Peter Piech and Nick Treharne exhibitions that were to be held in the building were converted into digital exhibitions, using People’s Collection Wales as a platform. A suite of online exhibitions based on the collections was launched on the Google Arts & Culture platform in March 2021.

3.1.5 Mass Digitisation

The pandemic enabled the Library to redeploy resources to increase the number of digital collections processed and made available online. A total of 468,677 new digital pages were made available during 2020/21, which was a significant increase compared to 2019/20.

3.1.6 The Nation's Memory: Informing the Future: 2017-2021 strategic plan

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There have been many notable achievements during the 5-year strategic planning period ending March 2021 in particular:

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3.2. Key Achievement Indicators

The Library’s performance against its targets was reported to the Welsh Government in 2020/21 as follows:

Target
Attainment
1a
Number of user visits (total)
1,865,0
00
2,085,209
1
b
Number of visits to the Library’s digital
collections and services (total)
1,800,000
2,085,209
1c
New users to the Library's digital collections
and services
1,000,
000
1,233,995
1e
Number of responses to remote enquiries
7,0
00
3,369
2a
User satisfaction - physical visits
96%
100%
2
b
User satisfaction - digital visits
80%
85%
3a
Total number of events (total)
150
159
3
b
On-site events organized by the Library
80
77
3
d
Outreach events organized by the Library
70
82
4a
Number of participants in each of the
Library's activities (total)
11,500
9,636
4
b
Number of participants at on-site events
organized by the Library
10,000
8,222
4c
Number of participants at outreach events
organized by the Library
1,500
1,414
5
d
Digital Volunteers
800
848
6a
Number of Fusion events and Education
Service activities
35
40
6
b
Participants in Fusion events and Education
Service activities
900
738
7a
Number of new interpretation items
published online by the Library
1,200
2,488

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7 New digital pages created through the 200,000 468,677 b Library's digitization program 8a Number of impressions across social media 2,750,000 3,632,581 channels 8 Reach of the Library's content on Wikimedia 190,000,000 244,402,588 b

The attainment figure for 1a does not include physical visits to the Library which were limited due to the COVID-19 pandemic during 2020-21.

Performance against targets is reviewed by the Welsh Government and the Board with notes and interpretations being provided regarding achievements against targets.

We are obliged to monitor continuously and evaluate our work both quantitatively and qualitatively. Although our quantitative achievement indicators provide a snapshot of performance, the qualitative data from case studies and narrative reports still continue to provide a more detailed snapshot, and an and an opportunity to reflect on our work and enrich it.

4 FINANCIAL REVIEW

4.1 Financial Results and Allocations

The accounts are prepared under Section 9(4) of the Museums & Galleries Act 1992 in a form directed by Ministers of the Welsh Government with the approval of the Treasury. The Library's net incoming resources for the financial year were £3,208k (2019/20: £808k)). The Library’s incoming resources totalled £17.31m (2019/20: £14.54m) and total resources expended were £14.10m (2019/20: £13.73m).

The unrestricted public reserve increased from £338k to £789k.

Fund balances at 31 March 2021 stood at £78.2m (31 March 2020 £75.8m).

4.2 Charities Statement of Recommended Practice

The Charity Commission issued a Statement of Recommended Practice (SORP) for charities in October 1995, which was most recently updated by the Charities SORP 2015. The Library has complied with the SORP since the 1996/97 accounts.

4.3 Valuation of Tangible Fixed Assets

The Library commissioned a revaluation by Cooke and Arkwright, Chartered Surveyors, of the Library’s buildings and freehold land as at 31 March 2021. Land and buildings values are adjusted annually by indexation between each formal valuation which usually takes place every five years. Other fixed assets are not

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22

revalued nor indexed, and from 2017-18, are held at original cost less depreciation.

4.4 Charity Reserves Policy

The Charities SORP 2015 requires the Library to disclose its policy on Reserves.

4.4.1 Unrestricted Public Funds

The National Library of Wales is currently dependent on the Welsh Government to sustain the majority of its activities. The Library’s Public Funds reserves policy is to conform to the requirements of the Welsh Government’s Framework Document, which sets out the financial framework under which the Library is required to operate. The main requirement of the Framework Document in relation to reserves is that only 2% of gross Grant-in-Aid can be held as cash balances. This requirement is particularly difficult at a time of financial uncertainly and mitigation of risks would justify carrying higher levels of reserves due to the financial outlook. Therefore, the Library is exposed to a high level of financial risk and the requirements of the Welsh Government do not help to promote good financial and risk management in relation to the level of reserves held.

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4.4.2 Restricted Public Funds

Public restricted funds represent Capital and Purchase Grants received from the Welsh Government or any grant received from a public body for specific purposes. This funding is also restricted to 2% of gross Grant-in-Aid carry over in cash balances.

4.4.3 Unrestricted Private Funds

The Library’s unrestricted private funds have three main objectives:

The level of reserves is being reviewed and monitored by the Board through the Financial Planning Committee.

4.5.4 Restricted Private Funds

The Library’s restricted private funds can only be used in accordance with any stipulated terms of each specific bequest. They can only be used for the purposes described and therefore they are only used when an item of expenditure that directly relates to the fund is approved by the Board or the funder.

4.6 Investment Policy

The portfolio has been invested in both equities and bonds and the amount that can be invested in diferent asset classes has been set in accordance with a risk assessment. The Library’s attitude to risk is considered “moderate”, accepting that in order to achieve higher returns than placing cash in a deposit account, there will be a consequent risk in investing in bonds and equities.

The Board reviews the Investment Policy and Strategy on an annual basis, which includes consideration of social, environmental or ethical investments.

The Library has appointed investment managers, Investec Wealth & Investment, who are responsible for investing the private funds portfolio. The managers have been set a benchmark for the performance of the investment portfolio, and in 2020/21 a return of 22.76% was achieved against a benchmark of 16.63% (2019/20: -4.99% against a benchmark of -4.81%).

The investments were managed on a discretionary basis in accordance with the requirements of the Trustee Investments Act 1961 and latterly the Trustee Act 2000. The performance of the portfolios is monitored and submitted regularly in the form of a report to the Financial Planning Committee and the Trustees. On 31 March 2021, the market value of the investments and cash was £13.63m (£11.15m on 31 March 2020).

4.7 Key risks and uncertainty

4.7.1 Financial uncertainty

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Following discussion with the Welsh Government and the Deputy Minister the Library was awarded £500k of additional revenue GIA funding in 2020/21. In 2021/22 an additional £750K has been allocated to meet the costs of implementing the Tailored Review, and £1,000k to meet the other financial pressures. It is expected that this £1,000k will be confirmed in the Library’s baseline GIA from 2022/23 onwards.

The Library reviewed its policy for charitable reserves during 2020/21. Unrestricted private funds are available to the Board in order to manage financial risk as part of its reserves policy.

4.7.2 Pension Scheme

An actuarial valuation of the scheme was obtained on 31[st] March 2019. The main results of the Scheme’s actuarial valuation are as follows:

The additional contribution rate will be implemented from the 1[st] April 2022 following an additional employer contribution of £400k in March 2020 and a further £400k in March 2021.

As at 1[st] July 2017 existing staf could also choose to contribute either 3% of their salary towards not having a reduction in their pension if they retire at the age of 60 or to accept that the retirement age has changed to 65, and so there will be an actuarial reduction in the pension if they retire before this date. New members of staf after this date have a normal retirement date of 65.

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5 SUSTAINABILITY REPORT

This report has been complied in accordance with the guidelines laid down by HM Treasury in Public Sector Annual Reports: Sustainability Reporting Guidance . During 2020-21, the following was achieved: -

Water consumption
Water consumption m3
Water consumption m3per WTE
Water supply costs £
Paper consumption
Paper consumption in reams (external and
internal)
Paper consumption in reams (internal use)
Waste
Total waste (tonnes)
Reused, recycled, composted
Landfll
Hazardous
Reused, recycled, composted as % of total
waste
Total disposal cost
Greenhouse gas emission*
Total emission tonnes CO²equivalent
Attributable to business travel
Attributable to energy consumption
(1,000 tCO²e)
Electricity and Gas
Attributable to energy consumption
Electricity (kWh)
Gas (kWh)
Expenditure on business travel £ (Car,
Train, Bus & Plane)
Total energy expenditure £		 2020-21
2019-20
2018-19
6,139
9,585
10,323
28.46
43.37
40.48
£23,110
£39,191
£47,054
6
698
550
2
632
514
14.17
42.44
35.11
3.55
33.9
26.6
10.62
8.58
8.51
-
-
-
25.0%
79.8%
75.8%
£8,344
£9,125
£4,953
0
17
16
1,133
1,276
1,368
2,235,89
4
2,521,075
2,649,751
3,348,74
9
3,458,695
3,510,705
£51
£49,360
£51,591
£354,87
2
£394,724
£366,057

*WTE = full-time equivalent

Note on Energy:

Costs are total for the site including energy supplied to adjacent building, but consumptions are only for National Library buildings.

The Welsh Government’s budget for 2021/22 included additional capital funding of £0.5M for the Library to commence its decarbonisation programme. The replacement of the heating system which uses gas with combined heater/chiller plant is planned, and this will maintain environmental conditions for storage of the collections and at the same time provide heating for other parts of the building. The Library is developing onsite solar photo-voltaic generation, and the set of panels on the Outstore building installed in 2020/21 are the second such installation on the building. The Library hopes to secure future funding for

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26

decarbonisation in the next few years with the aim of becoming carbon neutral by the mid-2020s.

Horticultural waste generated on site is composted on site. The quantity of this waste is not measured.

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27

6 POLICIES RELATING TO STAFF

6.1 Living Wage

The Library has undertaken to pay the living wage as set out by the Living Wage Foundation since April 2014.

6.2 Recruitment and Retention of Staf

The Library can only achieve its goals through the commitment of its staf; therefore the Library focuses on providing a staf training and development programme annually to ensure that all staf members achieve their potential.

6.3 Employment of Disabled People

The Library operates a non-discriminatory recruitment procedure and is always prepared to consider applications from, and to appoint, disabled persons. The Library makes every efort to ensure that disabled employees are provided with the facilities necessary to carry out their employment efectively.

6.4 Consultation with Employees

The Library communicates information to staf by various methods including staf meetings, weekly e-mails, team briefing sessions, Core Brief, and regular consultation and negotiation with the Partnership Council and representatives of the national Trade Unions. The Library adopted an Internal Communication Strategy in 2016 and implementation of this Strategy will be a further opportunity to develop the relationship between managers and staf.

6.5 Remuneration Report

The Library remunerates its entire staf under an agreed pay and grading system. The current system was approved by the Library’s Executive Team and agreed with the staf unions through the collective bargaining arrangements. An independent appeals process is in place to consider grading issues.

Each year, the Library, in consultation with the staf unions, considers the Library’s remuneration package against external comparators, movements in the economy and any internal inequities that may have developed. From this, a pay remit or proposal is produced and this is submitted to the Welsh Government for approval and is then formally negotiated with the unions. This leads to a new pay and conditions package for the whole of the Library staf which is binding until the next round of negotiation. Incremental increases under the pay remit are dependent upon the Library’s system of annual appraisals. Inflationary elements contained within the agreed pay remit are automatically awarded to all members of staf.

The salaries of the Chief Executive and Librarian and the two Directors and Deputy Chief Executives have been included as part of the pay remit negotiations in relation to all Library staf. The Chief Executive and Librarian during the year had a fixed term employment contract and the two Directors/Deputy Chief Executives had permanent contracts. All three are ordinary members of the Library’s pension scheme.

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The pay remit is approved by the Welsh Government. Membership of the Executive Team is shown on page 2 and further details of the remuneration and pension benefits are shown in Note 8(c) to the accounts. The notice period for members of the Executive Team is 3 months. Provision for compensation for early termination is contained within the Library’s standard redundancy agreement.

7 PLANS FOR FUTURE PERIODS

During 2020-21 the Library entered the last year of its current Strategic Plan covering 2017-2021. A new Strategic Plan for 2021-2026 under the title ‘A Library for Wales and the World’ was developed over many months from the Summer of 2020 onwards in consultation with key stakeholders. The final version was approved by the Board of Trustees in January 2021. It is an ambitious plan that provides a clear, coordinated and prioritised focus and direction for everyone involved in the organisation over the next five years.

The new plan identifies four strategic and well-being objectives:

The Well-being of Future Generations Act was a key consideration when drafting the new Strategic Plan and the requirements of the Act have been considered when formulating plans to deliver against the objectives.

----- Start of picture text -----
Strategic Objective 1 How will we achieve this?
Cultivate and care for the
nation’s memory
 We will develop and invest in the work of
 Capturing collecting and preserving digital
contemporary Wales materials in various formats
 We will establish a National Broadcast
 Committed to diversity Archive that will be a rich and
comprehensive record of life in the 20th
and 21st Centuries
 Leading in
 We will deliver guidance and advice on
preservation and
conservation and raise awareness of the
management of
information risks of losing the national memory in
the digital age
 We will develop our relationships with
libraries, archives, museums and others
in the heritage sector as we collect the
nation’s memory
 We will foster our connections with
ethnically diverse communities across
Wales
 We will work with these communities as
----- End of picture text -----

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29

----- Start of picture text -----
we continue to develop our Collections
Policy
 We will review the way in which our
collections are described, interpreted
and promoted
 We will invest in the cultivation and
transfer of physical and digital
conservation skills within the Library and
across the sector
 We will invest in the development of our
technical infrastructure as a trusted
home for our digital collections
 We will support other organisations with
the preservation of digital collections
 We will share good practice in
information management, conservation
and collections development
internationally
How will we achieve this?
Strategic Objective 2
Lay the foundation for a
knowledge economy
 Knowledge that  We will continually review the way we
invigorates and describe collections, to provide efective
inspires access and highlight ‘hidden’ collections
 Creating opportunities  We will improve access to physical
to participate collections by continuing our digitisation
 Improving user programme
experience  We will seek opportunities to increase
the use of collections by businesses and
the creative sector
 We will work to ensure that information
is available in an open and accessible
format
 We will continue to ofer a range of
volunteering opportunities at Library
sites
 We will increase opportunities for
volunteering and engaging with the
collections on a digital basis, using
approaches such as crowdsourcing
 We will support national and
international participatory programmes
and projects
 We will develop new and innovative ways
of widening access to knowledge
 We will ensure that user feedback and
the voice of the user are central to the
development of our services
 We will invest in the building in
Aberystwyth as a visitor destination,
where visitors from Wales and the world
can research, discover and enjoy
Strategic Objective 3 How will we achieve this?
----- End of picture text -----

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----- Start of picture text -----
Be at the heart of national
life
 Connecting  We will invest in our relationship and
communities connections with individuals and
 Sharing collections communities with the aim of increasing
 Promoting a global the value and impact of our collections
Wales and services
 We will establish connections with new
communities and audiences
 We will consider all opportunities to
expand our connections with public
bodies and organisations throughout
Wales and further afield
 We will improve access and connections
across Wales through the activities of the
National Broadcast Archive.
 We will share our collections widely and
openly with the aim of achieving the
greatest reach and deepest
engagement
 We will develop methods and channels
for acting in collaboration with the public
to jointly interpret our history and
culture
 We will hold exhibitions and events on
themes that are timely and relevant to
Wales today
 We will promote the Library’s sites as
cultural destinations
 We will develop and deliver an
International Strategy and collaborate
with Welsh Government and other
organisations to promote Wales on a
global stage
 We will continue to foster and strengthen
our relationship with the Welsh diaspora
Strategic Objective 4 How will we achieve this?
Empowering learning and
research
 Enabling research and  We will foster a relationship with Higher
innovation Education Institutions and research
 Supporting formal teams interested in the collections
learning  We will explore and experiment with new
 Promoting informal technologies as means of enhancing
learning access and research, supporting aspects
such as geodata, artificial intelligence
and adopting concepts such as
'collections as data'
 We will collaborate with partners and
stakeholders with the aim of establishing
an accredited trusted digital repository
as research infrastructure
 We will continue to contribute to the dev
----- End of picture text -----

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elopment of the Curriculum for Wales  We will continue to increase our own ran ge of digital learning resources in collaboration with partners  We will invest in our services for schools and post-16 education  We will develop a programme that supports informal learning and foster skills and transfer knowledge  We will increase the interpretative conte nt available online as resources for informal learning  We will explore opportunities to work in p artnership to support informal learning in communities across Wales

Trustees

The Trustees have complied with their duties to have due regard to guidance published by the Charity Commission.

Auditor

The Accounts are audited by the Auditor General for Wales in accordance with Section 9(8) of the Museums and Galleries Act 1992 for Wales

Pedr ap Llwyd CHIEF EXECUTIVE & LIBRARIAN 23 July 2021

Lee Yale-Helms TREASURER 23 July 2021

STATEMENT OF BOARD AND LIBRARIAN’S RESPONSIBILITIES

Under Section 9(4) of the Museums and Galleries Act 1992, the Board of the National Library of Wales is required to prepare a statement of accounts for each financial year in the form and on the basis determined by Ministers of the Welsh Government with the consent of the Treasury. The accounts are prepared to give a true and fair view of the Library’s financial activities during the year and of its financial position at the end of the year.

In preparing the Library’s accounts the Board is required to:-

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32

The Principal Accounting Officer for Ministers of the Welsh Government has designated the Librarian as the Accounting Officer for the Library. His or her relevant responsibilities as Accounting Officer, including his or her responsibility for the propriety and regularity of the public finances for which he or she is answerable and for the keeping of proper records, are set out in the Welsh Government’s Accounting Officer Memorandum.

Statement of the Disclosure of Relevant Audit Information

As far as the Accounting Officer is aware, there is no relevant audit information of which the auditors are unaware, and the Accounting Officer has taken all steps that he ought to have taken to make himself aware of any audit information and to establish that the auditors are aware of that information.

Pedr ap Llwyd

CHIEF EXECUTIVE & LIBRARIAN 23 July 2021

Endorsed on behalf of the Board by

Lee Yale-Helms TREASURER 23 July 2021

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The Certificate and independent auditor’s report of the Auditor General for Wales to the Senedd

Opinion on financial statements

I certify that I have audited the financial statements of the National Library of Wales for the year ended 31 March 2021 under section 9 of the Museums and Galleries Act 1992. These comprise the Statement of Financial Activities, Balance Sheet, Cash Flow Statement and related notes, including a summary of significant accounting policies. These financial statements have been prepared under the accounting policies set out within them. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards including Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In my opinion the financial statements:

Opinion on regularity

In my opinion, in all material respects, the expenditure and income in the financial statements have been applied to the purposes intended by the Senedd and the financial transactions recorded in the financial statements conform to the authorities which govern them.

Basis of opinions

I conducted my audit in accordance with applicable law and International Standards on Auditing in the UK (ISAs (UK)) and Practice Note 10 ‘Audit of Financial Statements of Public Sector Entities in the United Kingdom’. My responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of my report. I am independent of the National Library of Wales in accordance with the ethical requirements that are relevant to my audit of the financial statements in the UK including the Financial Reporting Council’s Ethical Standard and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinions.

Conclusions relating to going concern

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

Based on the work I have performed, I have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the National Library of Wales’s ability to continue to

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34

adopt the going concern basis of accounting for a period of at least twelve months from when the financial statements are authorised for issue.

My responsibilities and the responsibilities of the Board of Trustees and Librarian as Accounting Officer 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 Accounts Report other than the financial statements, the audited elements of the remuneration report and my auditor’s report thereon. The Board of Trustees and Librarian as Accounting Officer are responsible for the other information in the annual report and accounts. My opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in my report, I do not express any form of assurance conclusion thereon.

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

I have nothing to report in this regard.

Report on other requirements

Opinion on other matters

Although there are no legislative requirements for a Remuneration Report, the National Library of Wales has prepared such a report and in my opinion that part ordinarily required to be audited has been properly prepared in accordance with HM Treasury guidance.

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

Matters on which I report by exception

In the light of the knowledge and understanding of the National Library of Wales and its environment obtained in the course of the audit, I have not identified

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35

material misstatements in the Annual Accounts Report including the Governance Statement.

I have nothing to report in respect of the following matters which I report to you, if, in my opinion:

Responsibilities

Responsibilities of the Board of Trustees and Librarian for the financial statements

As explained more fully in the Statement of Board of Trustees and Librarian’s Responsibilities, the Board and Librarian as Accounting Officer are responsible for preparing the financial statements, in accordance with the Museums and Galleries Act 1992 and Welsh Ministers’ directions made there under, for being satisfied that they give a true and fair view and for such internal control as the Board and Librarian determine are 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 Board and Librarian are responsible for assessing the National Library of Wales’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 deemed inappropriate.

Auditor’s responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. I design procedures in line with my responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.

My procedures included the following:

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I also communicated relevant identified laws and regulations and potential fraud risks to all audit team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

The extent to which my procedures are capable of detecting irregularities, including fraud, is afected by the inherent difficulty in detecting irregularities, the efectiveness of the National Library for Wales’s controls, and the nature, timing and extent of the audit procedures performed.

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

Responsibilities for regularity

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The Librarian as Accounting Officer is responsible for ensuring the regularity of financial transactions.

I obtain sufficient evidence to give reasonable assurance that the expenditure and income have been applied to the purposes intended by the Senedd and the financial transactions conform to the authorities which govern them.

Report

I have no observations to make on these financial statements,

Adrian Crompton Auditor General for Wales

24 Cathedral Road Cardif

2 August 2021

CF11 9LJ

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38

STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 MARCH 2021

----- Start of picture text -----
PUBLIC FUNDS PRIVATE FUNDS 2020/21 2019/20
Unrestricte Restricte Unrestricte Restricte Total Total
d d d d
Note £’000 £’000 £’000 £’000 £’000 £’000
s
Income:
Donations and legacies 15b - - 1,210 478 1,688 1,435
Charitable activities
Government Grants 2 10,444 3,811 - - 14,255 11,813
Other Grants 3 612 444 - - 1,056 407
Other trading activities 4 145 - - - 145 610
Investment income 15b - - 158 3 161 272
Total Income 11,201 4,255 1,368 481 17,305 14,537
Expenditure:
Costs of raising funds 5 535 56 44 1 636 937
Charitable activities:
Collection 5 2,563 700 - - 3,263 2,829
Giving Access & 5 - - 3,883
3,132 751 3,384
Information
Publicising & Interpretation 5 1,273 355 - 28 1,656 1,751
Conservation & 5 - - 3,901
3,370 531 3,582
Preservation
Governance 5 1,217 174 - - 1,391 1,230
Total expenditure 12,090 2,567 44 29 14,730 13,713
(Gain)/ Loss on disposal of 15b - - (1,042) (21) (1,063) (234)
investments
Pension Finance Costs 22d 430 - - - 430 250
Total expenditure 12,520 2,567 (998) 8 14,097 13,729
Net income/ (1,319) 1,688 2,366 473 3,208 808
(expenditure)
Gross transfers between 15 - 850 (822) (28) - -
funds
(1,319) 2,538 1,544 445 3,208 808
Other recognised gains/
(losses):
Unrealised gains/ (losses) 15b - - 1,271 - 1,271 (1,050)
on investments
Tangible Fixed Assets 10 - (452) - - (452) (3,393)
Revaluation, Indexation and
impairment
Actuarial gains / (losses) on 22e (1,660) - - - (1,660) (13,890)
defined benefit pension
scheme
Total gains/ (losses) (1,660) (452) 1,271 - (841) (18,333)
NET MOVEMENT IN (2,979) 2,086 2,815 445 2,367 (17,525)
FUNDS FOR THE
FINANCIAL YEAR
FUND BALANCES BROUGHT 15 (24,152) 80,699 12,007 7,283 75,837 93,362
FORWARD AT 1 APRIL
FUND BALANCES 15 (27,131) 82,785 14,822 7,728 78,204 75,837
CARRIED FORWARD AT
31 MARCH
----- End of picture text -----

All activities are continuing. All recognised gains and losses are recorded in the Statement of Financial Activities. The notes on pages 34 to 56 form part of these accounts. There is no endowment income or expenditure to report.

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BALANCE SHEET AS AT 31 MARCH 2021

FIXED ASSETS
Tangible Assets
Intangible Assets
Heritage Assets
Investments
CURRENT ASSETS
Stocks
Debtors
Bank
CREDITORS
Amounts falling due within one
year
NET CURRENT ASSETS
Net assets excluding pension
scheme liability
Defned beneft pension liability
NET ASSETS INCLUDING
PENSION SCHEME LIABILITY
FUNDS
Public Unrestricted
Pension Reserve
Total Public Unrestricted Funds
Public
Restricted
(exc
Revaluation Reserve)
Revaluation Reserve
Private Unrestricted
Private Restricted
Private Restricted Collections		 Notes
10
10
12
11
13
14
22
15		 31st March 2021
£000
£000
66,535
337
22,473
13,630
102,975
45
2,641
1,614
4,300
(1,151)
3,149
106,124
(27,920)
78,
204
789
(27,920)
(27,131)
61,415
21,370
14,822
249
7,479
78,204		 31st March 2021
£000
£000
66,535
337
22,473
13,630
102,975
45
2,641
1,614
4,300
(1,151)
3,149
106,124
(27,920)
78,
204
789
(27,920)
(27,131)
61,415
21,370
14,822
249
7,479
78,204		 31st March 2020
£000
£000
65,152
405
21,802
11,149
98,508
45
1,893
530
2,468
(649)
1,819
100,327
(24,490)
75,837
338
(24,490)
(24,152)
58,877
21,822
12,007
257
7,026
75,837
45
2,641
1,614
4,300
(1,151)
789
(27,920)
106,124
(27,920)
78,
204
(27,131)
61,415
21,370
14,822
249
7,479
78,204

The trustees have prepared the accounts in accordance with section 132 of the Charities Act 2011.

The notes on pages 34 to 56 form part of these accounts.

Pedr ap Llwyd Lee YaleHelms CHIEF EXECUTIVE AND TREASURER LIBRARIAN 23 July 2021 23 July 2021

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CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2021

CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021		 CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021		 CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021		 CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021		 CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021		 CASH FLOW STATEMENT FOR THE YEAR ENDED
31 MARCH 2021
2020/21
2019/20
£000
£000
£000
£000
Cash generated from
operating activities
17
4,534
1,071
Cash fows from investing
activities: -
Purchase of tangible and
intangible fxed assets
10
(3,085)
(3,657)
Purchase of heritage assets
12
(218)
(401)
Proceeds from sale of investments
11
6,383
1,144
Purchase of Investments
11
(7,495)
(984)
Net cash provided by/(used in)
investing activities
(4,415)
(3,898)
Increase/(Decrease) in Cash
and cash equivalents in the
year
119
(2,827)
Cash and cash equivalents at the
beginning of the year
2,948
5,775
Total cash and cash equivalents at
the end of the year
18
3,067
2,948
Cash generated from
operating activities
Cash fows from investing
activities: -
Purchase of tangible and
intangible fxed assets
Purchase of heritage assets
Proceeds from sale of investments
Purchase of Investments
Net cash provided by/(used in)
investing activities
Increase/(Decrease) in Cash
and cash equivalents in the
year
Cash and cash equivalents at the
beginning of the year
Total cash and cash equivalents at
the end of the year		 17
10
12
11
11
18		 2020/21
£000
£000
4,534
(3,085)
(218)
6,383
(7,495)
(4,415)
119
2,948
3,067		 2019/20
£000
£000
1,071
(3,657)
(401)
1,144
(984)
(3,898)
(2,827)
5,775
2,948
119
2,948
3,067

The notes on pages 34 to 56 form part of these accounts.

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41

NOTES TO THE ACCOUNTS AT 31 MARCH 2021

1 ACCOUNTING POLICIES

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

(a) Basis of preparation

The financial statements have been prepared in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), the Charities SORP (FRS 102), and the 2000 Accounts Direction issued to the Library by the Welsh Government. The accounts are prepared on a going concern basis.

The National Library of Wales 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 (s),

The accounts meet the requirements of Accounting Standards issued or adopted by the Financial Reporting Council in so far as those requirements are appropriate. The Accounts Direction does not require the Library to produce a summary income and expenditure account or note of historical cost on surpluses or deficits.

(b) Incoming Resources

All income is recognised when the charity has entitlement to the funds, any performance conditions attached to the item have been met, it is probable that the income will be received and the amount can be measured reliably.

All Grant-in-Aid from Welsh Government is recognised in the Statement of Financial Activities (SOFA) on a receivable basis. Other grants of a more specific nature are recognised on a receivable basis when grant conditions are met.

For legacies, entitlement is taken as the earlier of the date on which either; the charity is aware that probate has been granted, the estate has been finalised and notification has been made by the executor (s) to the Library that a distribution will be made, or when a distribution is received from the estate. Where legacies have been notified to the charity or the charity is aware of the granting of probate, and the criteria for income recognition have not been met, then the legacy is treated as a contingent asset and disclosed if material. Transfers from private funds are accounted for after consideration of movements in working capital. Income received relating to subsequent accounting periods will be treated as deferred income.

Fund Accounting

Unrestricted funds (public and private) are available to spend on activities that further any of the general objectives of the Library. Public restricted

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42

funds represent Capital and Purchase Grants received from the Welsh Government for specific purposes.

Private restricted funds are funds subject to specific restriction imposed by donors or by the purpose of the appeal. Designated funds are unrestricted funds of the charity which the trustees have decided at their discretion to set aside for a specific purpose. Private restricted funds are donations which the donor has specified are to be solely used for particular areas of the Library’s work or for a specific project being undertaken by the Library.

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43

(c) Expenditure

Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Where expenditure has been incurred in advance and relates to a later period, the accounts will only consider a prepayment if higher than £5,000 in value. Where expenditure is incurred in arrears but relates to the current financial year, the accounts will only consider an accrual if higher than £5,000 in value. Expenditure is classified under the following activity headings:

(d) Investments

Investments are stated at market value at the balance sheet date. Gains and losses on disposal are credited or charged to the Statement of Financial Activities. Movements in the market value of investments held at the year-end are also reflected in that statement in accordance with the Charities SORP (FRS 102).

(e) Tangible and Intangible Assets

Individual plant, machinery, equipment and motor vehicles costing £5,000 or more are capitalised at cost, unless the equipment forms part of a group of assets, network or project where the value is over £5,000. Assets are depreciated over their estimated useful lives on a straight-line basis. Items of a capital nature costing less than £5,000 are not capitalised and are written of in-year. Non-property assets (i.e. plant & vehicles, and fixtures, fittings & equipment) are held at historic cost and not indexed as these assets have short useful economic lives or low values (or both). This is considered to provide a more reliable, appropriate and relevant representation of the fair value of these assets. Further details are provided in Note 10.

Land and buildings assets are usually professionally valued every five years on the basis of their current value in existing use assuming that the properties would be sold as part of a continuing business and are revalued using an index in the intervening period. Revaluation gains are recognised in the Statement of Financial Activities under gains/(losses) on the revaluation of fixed assets, except to the extent to which they ofset any previous write of of expenditure in the Statement of Financial Activities, in which case the gain is reversed against the relevant expenditure heading. Revaluation losses are recognised as an expense under the relevant expenditure heading in the Statement of Financial Activities except to the extent to which they ofset any previous revaluation gains, in which case the loss is shown under gains/(losses) on the revaluation of fixed assets.

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44

Routine maintenance work in respect of these properties is noted as revenue cost in the year in which it is undertaken.

Depreciation is provided in full in the year of acquisition, at rates calculated to reduce each asset to its estimated residual value evenly over its expected useful economic life, as advised by the valuers as follows:

Freehold land is not depreciated.

Collection Purchases are not depreciated (see Heritage Assets (f)).

Intangible assets with an economic life of more than one year and value greater than £5,000 are capitalised. All intangible assets are measured at cost. Intangible assets are amortised on a straight-line basis over a period of 10 years.

(f) Heritage assets

Prior to 1[st] April 2001, the Library’s collection had not been capitalised in the balance sheet. Purchases for the collection were charged to Restricted Public Funds in the Statement of Financial Activities in the year of acquisition. Purchases for the collection are capitalised in the year of acquisition and held at historic value; these assets are not re-valued or indexed.

Donations of items to the collections are accounted for when received at an estimate of their market value. These assets are not revalued or indexed.

Heritage Assets are not depreciated because they have indefinite life.

The carrying amount of an asset will be reviewed only where there is evidence of impairment.

(g) Stocks

The cost of stocks of re-saleable items has been recognised in the balance sheet at the lower of cost or net realisable value. No value is given on assets produced historically by the Library where there is a restricted market for the goods or goods have impaired.

(h) Pension Costs

The Library operates its own superannuation scheme which provides benefits based on final pensionable salary. Contributions to the scheme are charged to the Statement of Financial Activities so as to spread the cost of pensions over employees working lives. The charge to the Statement of

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45

Financial Activities is calculated based upon the current service cost as calculated by the scheme actuary.

(i) Staf holiday pay

At the year end, staf holiday entitlements that has not yet taken and which is carried forward to the next financial year have been provided for in the accounts in line with FRS 102 requirements.

(j) Taxation

The Library has been granted charitable status by the HMRC and is therefore exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects. Non-recoverable Value Added Tax arising from expenditure on non-trading activities is charged to the Statement of Financial Activities or capitalised if related to a fixed asset.

(k) Significant areas of estimation and judgement

The preparation of the financial statements requires judgements, estimations and assumptions to be made that afect the reported values of assets, liabilities, revenues and expenses. The nature of estimation and judgement means that actual outcomes could difer from expectation.

Sources of estimation uncertainty

(l) Going Concern

The Library’s accounts have been prepared on a going concern basis. The Library’s Board has recognised the significant revenue account deficits that have been forecast and will be considering plans to address this situation. The significant level of unrestricted private funds reserves will ensure that the Library can continue with current activities until action is taken to

46

The National Library of Wales Annual Accounts 2020/21

address the deficit. There are no other material uncertainties about the charity’s ability to continue.

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47

2. GOVERNMENT GRANTS

Unrestricted
Grant-in-Aid
Restricted
Capital - Purchase Grant
Capital – Digital Development Grant
Capital - General
Digital Libraries
People’s Collection Wales
ARCW
Wikipedia
Total
grant
received
from
Welsh
Government		 2020/21
2019/20
£000
£000
10,444
9,985
305
305
-
41
2,790
1,000
498
186
114
117
47
141
57
38
14,255
11,813

3. OTHER GRANTS

----- Start of picture text -----
2020/21 2019/20
£000 £000
Restricted public fund
European Union Grants 10 -
British Film Institute 21 -
National Heritage Lottery Fund – National 270 222
Broadcast Archive 130 135
National Heritage Lottery Fund – Save Our
Sounds
Other minor grants 13 50
444 407
Unrestricted public fund
Coronavirus Job Retention Scheme 612 -
Total other grants 1,056 407
----- End of picture text -----

During the period 1[st] April 2020 to 31[st] March 2021 the Library has claimed Coronavirus Job Retention Scheme grant totalling £612k. This related to an average of 54 staf members per month for the 12 month period. The closure of the Library building was required under the Welsh Government response to the COVID-19 pandemic. Services that generated commercial income were unable to operate and as such the Library’s income for the year reduced significantly. The Library obtained support to its application for funding under the Scheme from Welsh Government.

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48

4. INCOME FROM OTHER TRADING ACTIVITIES

Unrestricted public income
Catering
Shop income
Events
Consultancy and systems
Income generated from collections
Licensing and royalties
Miscellaneous
Car Park
Total		 2020/21
2019/20
£000
£000
2
211
20
93
-
17
14
46
24
61
43
36
42
133
-
13
145
610

5. ANALYSIS OF EXPENDITURE

----- Start of picture text -----
Staf Other Depreciati 2020/2 2019/20
Costs direct on and 1 TOTAL
costs amortisati TOTAL
on
£000 £000 £000 £000 £000
Cost of raising funds 512 68 56 636 937
Charitable
Expenditure
Collection 1,720 1,272 271 3,263 2,829
Giving Access & 3,097 456 330 3,883 3,384
Information
Publicising & 1,382 141 133 1,656 1,751
Interpretation
Conservation & 3,434 113 354 3,901 3,582
Preservation
Governance 668 549 174 1,391 1,230
10,813 2,599 1,318 14,730 13,713
----- End of picture text -----

6. NET INCOME/ (EXPENDITURE) FOR THE YEAR

This is stated after charging:
Depreciation and amortisation
External auditor’s remuneration
Internal audit fees
Investment management fees		 2020/21
2019/20
£000
£000
1,318
1,210
33
33
12
12
45
40

The National Library of Wales Annual Accounts 2020121 49

The National Library of Wales Annual Accounts 2020/21

50

7. ANALYSIS OF SUPPORT COSTS

The Library initially identifies the costs of its support functions. It then identifies those costs which relate to its governance function. Having identified its governance costs, the remaining support costs are apportioned between the cost of raising funds and four key charitable activities undertaken in the year.

The support salary cost is apportioned in line with salary costs for each department, with the non-staf support cost allocated based on activity expenditure.

----- Start of picture text -----
£000 £000 £000 £000 £000 £000 £000
Exec Support 1 2 5 9 4 10 31
Finance 8 30 52 53 21 50 214
HR 6 30 48 44 17 40 185
ICT 40 155 268 282 115 268 1,128
Building 47 355 536 388 144 306 1,776
Other 2 3 7 13 6 13 44
104 575 916 789 307 687 3,378
Total
Collection
Governance Information Publicising & Preservation
Interpretation
Giving Access & Conservation &
Cost of generating
----- End of picture text -----

8. ANALYSIS OF STAFF COSTS, TRUSTEE REMUNERATION AND EXPENSES, AND THE COST OF KEY MANAGEMENT PERSONNEL (a) Total Staf Costs

Salaries and Wages
Social Security Costs (including
Apprenticeship Levy)
Pension Cost
Current Service Cost
Defcit Contribution for past
service cost
Additional pension contribution
FRS 102 current service cost
adjustment
Wages as noted in note 5
FRS 102 fnance interest charge
(see note 22d)
Total		 2020/21
£000
£000
6,760
619
1,694
-
400
1,340
3,434
10,81
3
430
11,24
3		 2020/21
£000
£000
6,760
619
1,694
-
400
1,340
3,434
10,81
3
430
11,24
3		 2019/20
£000
£000
6,336
595
1,673
32
400
560
2,665
9,596
250
9,846
10,81
3
430
11,24
3

There were no agency or short term contractors employed.

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51

Other than the staf noted in 8c, there were no members of staf who earned over £60,000 (2019/20- Nil).

(b) Pension Scheme

The Library operates a funded pension scheme which is a defined benefit pension scheme providing benefits based on final pensionable pay at a normal retirement age. Members leaving the scheme who have contributed for a period of less than 2 years will receive a refund of member’s contributions. Benefits accrue at the rate of 1/80[th] of pensionable salary for each year of service. In addition, a lump sum equivalent to 3 years’ pension is payable on retirement. On death, pensions are payable to the surviving spouse at a rate of half the member’s pension. On death in service the scheme pays a lump sum benefit. Medical retirement is possible in the event of serious ill-health.

The employer contribution to the scheme for the period amounted to £2.1m (2019/20 £2.1m). The assets of the Scheme are held separately from those of the Library and were invested with Blackrock. The 31 March 2019 actuarial valuation showed that the market value of the Scheme’s assets was £73.2m and that the actuarial value of those assets amounted to 100% of the value of the liabilities of the Scheme. However, by 31 March 2021 the Actuary’s interim assessment was that the Scheme was likely to have fallen into a deficit of £3.5M. This was due to a number of factors, including the pay award from 1 April 2019 that had significantly increased pension benefits above the rate allowed for in the full valuation, a reduction in the discount rate used to calculate pension benefits and the efect of COVID-19 and Brexit on asset prices. In addition, there was a longer term efect on the price of index-linked Gilts linked to RPI, which is likely to fall when the UK Government’s plans to cease using RPI and move to CPI instead.

Note 22 provides further information on the finances of the pension scheme to comply with the requirements of FRS 102. The actuarial statement is published in the National Library of Wales’ Pension Fund Annual Accounts. Welsh Government granted in 2006/07 a Crown Guarantee which exempts the Scheme from the Pension Protection Fund and the associated levy.

(c) Remuneration of Executive Team

Membership of the Executive Team is noted on page 2 (Reference & Administrative Details). The Executive Team’s terms and conditions is indicated in Section 6 of the Trustee Report (6.5).

The Librarian’s salary was 3.41 times the median salary (£28,176) of the Library. Other senior staf receive a gross salary, which is determined as part of the negotiation of the pay remit for all other staf in the Library.

The value of pension benefits is calculated as follows:

*excluding increases due to inflation or any increase of decrease due to a transfer of pension rights.

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52

The multiplier of 20 is specified in the disclosure requirements. The Library has used this figure in order to comply with the guidance. This is not an amount which has been paid to an individual by the Library during the year; it is a calculation which uses information from the pension benefit table. These figures can be influenced by many factors e.g. changes in a person’s salary, whether or not they choose to make additional contributions to the pension scheme from their pay and other valuation factors afecting the pension scheme as a whole.

The National Library of Wales Staf Superannuation Scheme is a funded final salary scheme. The accrued pensions and lump sums are the amounts that would be paid from Normal Retirement Date if the member left service at the relevant date. The Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the pension scheme benefits, including any Additional Voluntary Contributions and transfers in of service, accrued by the member at a particular point in time. The transfer values have been calculated in accordance with the guidance note “GN11” published by the Institute of Actuaries and Faculty of Actuaries. The assumed rate of price inflation was 0.5% (2019/20 1.7%).

The following payments were made to members of the Executive Team:

----- Start of picture text -----
2020/21 2019/20
£ £ £ £ £ £
Mr P ap Llwyd 96,21 38,890 135,10 94,230 120,95 215,180
Chief Executive and 3 3 0
Librarian
Mr. DH Michael 79,85 33,124 112,98 80,269 23,263 103,532
Director and Deputy 6 0
Chief Executive and
Librarian
Dr O Roberts 80,46 64,537 144,99 65,637 37,348 102,985
Director and Deputy 2 9
Chief Executive and
Librarian
Pension Single Total Figure of Figure of
Consolidated Real Increase (decrease) in Consolidated Real Increase Single Total Remuneration
ry s on y n
----- End of picture text -----

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53

The pension entitlements of the Library’s senior staf with responsibility for running policy-making departments are disclosed as follows:-

Cash
Equivalent
Transfer
Value at
31/3/20
or at
date
became
director
if later
Total
Accrued
Pension
at
31/3/21
Lump
Sum at
31/3/2
1
Cash
Equivalen
t
Transfer
Value at
31/3/21
Increase
in
accrued
pension
net of
infation
Increase
in lump
sum net
of
infation
Increase
(Decrease)
in transfer
value net
of infation
£
£
£
£
£
£
£
Mr P ap
Llwyd
Chief
Executive
and
Librarian
563,710
23,080
69,240
579,640
1,620
4,870
13,110
Mr
DH
Michael
Director
and Deputy
Chief
Executive
and
Librarian
642,180
25,570
76,710
675,650
1,470
4,410
30,260
Dr
O
Roberts
Director
and Deputy
Chief
Executive
and
Librarian
196,470
11,300
33,900
261,060
2,780
8,330
63,610

(d) Gifts Register

The Library also operates a gifts register. No items noted during the year are considered of material interest to these financial statements.

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54

(e) Severance

Voluntary severance payments of £307,542 were accounted for in 2020/21 of which £20,200 were paid in 2020/21 (2019/20: Nil).

(f) Board emoluments

The Board do not receive any emoluments. The total amount of travel, subsistence, and hospitality expended by the Library for its Board and committee members was £261 (2019/20 £6,668), this was claimed by 2 members (2019/20: 16 members).

9. STAFF NUMBERS

The average monthly head count was 239 (2019/20: 244) and the average fulltime equivalent staf employed by the Library (including casual and part-time staf) during the year were as follows:

----- Start of picture text -----
Staf Numbers 2020/21 2019/20
Fundraising trading 10.8 11.1
Collection 38.8 39.9
Giving Access and Information 56.1 57.6
Publicising and Interpretation 30.2 31.0
Conservation & Preservation 66.9 68.5
Governance 12.9 13.3
Total 215.7 221.4
----- End of picture text -----

10. TANGIBLE AND INTANGIBLE ASSETS A. Tangible Assets

Cost & Valuation
At 1 April 2020
Additions
Disposals
Revaluation
At 31 March 2021
Depreciation
At 1 April 2020
Charged for the year		 Freehold
Land
&
Buildings
Plant,
Fittings
&
Equipme
nt
Computer
equipment
Total
£000
£000
£000
£000
63,100
2,651
3,620
69,371
2,246
129
710
3,085
-
-
-
-
(1,239)
-
-
(1,239)
64,107
2,780
4,330
71,217
-
1,863
2,356
4,219
787
153
310
1,250

55

The National Library of Wales Annual Accounts 2020/21

Disposals
Revaluation
At 31 March 2021
Net Book Value
At 31 March 2021
At 31 March 2020		 -
-
-
-
(787)
-
-
(787)
-
2,016
2,666
4,682
64,107
764
1,664
66,5
35
63,100
788
1,264
65,152

The Library received a valuation as at 31[st] of March 2021 on the Library’s freehold buildings and land by Cooke and Arkwright, Chartered Surveyors. Their valuation was carried out in accordance with the Royal Institution of Chartered Surveyors Appraisal and Valuation Manual. Buildings have been valued on the basis of “open market value” or “depreciated replacement cost”, and land is shown at “existing use value”.

The carrying amount of freehold land and buildings under the historic cost convention would be £42,430k (2019-20: £41,278k).

All tangible assets were used for the furtherance of the charitable activities of the Library.

B. Intangible Assets

----- Start of picture text -----
Digital
developme
nt
£000
Cost
At 1 April 2020 1,086
Additions -
At 31 March 2021 1,086
Amortisation
At 1 April 2020 681
Charged for the year 68
At 31 March 2021 749
----- End of picture text -----

56

The National Library of Wales Annual Accounts 2020/21

The Nat
2020/21
Net Book Value
At 31 March 2021 337
At 31 March 2020 405

The National Library of Wales Annual Accounts 2020/21

57

11. INVESTMENTS

11. INVESTMENTS
Investments
Cash held for investments
Total investments
Market Value at 1 April 2020
Acquisitions at cost
Less disposals
Gain/(Loss) on disposals
Unrealised gain/(loss) on
revaluation
Market Value at 31 March
Cash held for investment
At 1 April 2020
(Decrease)/increase
At 31 March 2021		 2020/21 2019/20
£000
12,177
1,453		 £000
8,730
2,419
13,630 11,149
8,730
7,495
(6,383)
1,064
1,271		 9,708
984
(1,144)
235
(1,053)
12,177 8,730
2,419
(966)		 2,029
390
1,453 2,419

The historic cost of investments at 31 March 2021 was £11.508m (2019/20 £10.332m).

The assets were invested as follows: -

----- Start of picture text -----
Gilts, bonds, Unit trusts, UK equities Cash Total
debentures overseas directly
& equities, invested on
preference property & UK stock
alternative market
assets
£’000 £’000 £’000 £’000 £’000
No1 1,489 7,552 2,319 (7) 11,353
portfolio
No2 390 342 85 1,460 2,277
portfolio
1,879 7,894 2,404 1,453 13,630
----- End of picture text -----

In deciding on the returns that the Library requires from its portfolio, and the balance between capital growth and income, the Library is prepared to accept that there will be risks attached to the investment of funds above that of simply placing cash on deposit. The Library is prepared to accept these provided that they are within acceptable levels.

The Library’s appetite for risk could best be described as “moderate”. The Library is willing to accept that in order to achieve higher returns risks must be taken, but the Trustees will also consider the Library’s position as a charity largely funded from government grant and consequently the standards of stewardship that are implied. The risks of investment will therefore be tempered by:

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58

spectrum – i.e. a balance will be struck between the amount of bonds, equities, cash and other investments including property, and UK and nonUK investments.

12. HERITAGE ASSETS

Purchases of Heritage Assets are capitalised at historic cost.

Acquired or donated during the year:

At 01/04/20
Additions
Donations
At
31/03/21		 Books
Subscripti
on
Pictures
Manuscrip
ts
&Maps
Others
Digital
Collection
s
NSSAW
Total
£’00
0
£’000
£’000
£’000
£’000
£’000
£’000
1,97
1
2,799
11,916
380
4,370
366
21,802
25
32
157
-
-
4
218
-
-
452
-
-
1
453
1,99
6
2,831
12,525
380
4,370
371
22,473

Five Year financial summary of additions:

----- Start of picture text -----
2020/ 2019/2 2018/ 2017/ 2016/
21 0 19 18 17
£’000 £000 £000 £000 £000
Books 25 40 51 47 38
Subscription 32 44 55 48 53
Pictures, Manuscripts & 157 312 381 148 249
Maps
Film and music 4 5 12 6 9
Total Additions 218 401 499 249 349
----- End of picture text -----

The Library has an agreed policy for the acquisition, preservation and management of heritage assets. A copy of the agreed policy is available on request. The Library does not loan items to users, but collections are accessible in the reading rooms and exhibition spaces, as well as on-line.

The Library (since 1911) has the right to receive a copy of all books, magazines, newspapers and other printed material published in the UK and Ireland. It mainly collects material of Welsh and Celtic interest. Its collections currently include:

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59

No salaries were capitalised in the period.

13 DEBTORS – due within one year

Trade Debtors
VAT repayment due
Prepayments
Other Debtors & Accrued Income
Private Funds Accrued Income		 31st March 2021
31stMarch 2020
£000
£000
42
35
484
458
621
496
326
239
1,168
665
2,641
1,893

Included within Private funds accrued income is a balance of £1,050k which relates to a property legacy which the Library will receive 2 years after the grant of probate as per the terms of the will. The grant of probate was issued on the 16th April 2021 and therefore the Library will receive this estimated amount on or after 16th April 2023.

14 (a) CREDITORS - Falling due within one year

Trade Creditors
Accruals and deferred income
Holiday pay accrual		 31st March 2021
31stMarch 2020
£000
£000
74
117
776
342
301
190
1,151
649

14 (b) CREDITORS – Movement on deferred income

Deferred income brought forward 31st March
2021
31stMarch
2020
£000
£000

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The National Library of Wales Annual Accounts 2020/21

Release from previous year
Income deferred in the current
year
Deferred income carried forward		 245
270
(147)
(41)
325
16
423
245

Deferred income relates to grants received.

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61

15 ANALYSIS OF CHARITABLE FUNDS

a. Analysis of movements in funds - Public

PUBLIC FUNDS
Unrestricted – Public Pension
Unrestricted
Restricted: -
Capital
and
digital
development
Revaluation Reserve
Other restricted funds
Purchase grant funds
Total restricted public
funds
TOTAL PUBLIC FUNDS*		 At 1
April
2020
Incoming
Resources
Resourc
es
Expend
ed
Other
Moveme
nts
In Year
At 31
March
2021
£000
£000
£000
£000
£000
(24,490
)
-
(1,770)
(1,660)
(27,92
0)
338
11,201
(10,750
)
-
789
(24,152
)
11,201
(12,520
)
(1,660)
(27,13
1)
49,966
2,790
(1,318)
850
52,288
21,822
-
-
(452)
21,370
149
1,160
(1,249)
-
60
8,762
305
-
-
9,067
80,699
4,255
(2,567)
398
82,785
56,547
15,456
(15,087
)
(1,262)
55,654

*Revaluation reserve has been calculated based on the revaluation to assets since 1999 in line with the FRS 102 requirement for separate identification of revaluation reserve. Revaluations prior to 1999 are not included in this reserve.

Other movements in the year £1,262k include:

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62

b. PRIVATE FUNDS (including collections)

Income
Donations and Bequests
Interest Receivable
Total
Resources Expended
Costs of raising funds
Private project expenditure
(Proft) / loss on sale of
investments
Total
Net Incoming/ (Outgoing)
Resources
Transfers
Unrealised(loss)/ gain on
investments
Net movement in private funds
during the year
Brought forward at 1 April
Carried Forward at 31 March		 Unrestrict
ed
Restricte
d
Collectio
n
Total
Total
2020/2
1
2019/2
0
£000
£000
£’000
£000
£000
1,210
25
453
1,688
1,435
158
3
-
161
272
1,368
28
453
1,849
1,707
44
1
-
45
43
-
28
-
28
28
(1,042)
(21)
-
(1,063
)
(234)
(998)
8
-
(990)
(163)
2,366
20
453
2,839
1,870
(822)
(28)
-
(850)
(349)
1,544
(8)
453
1,989
1,521
1,271
-
-
1,271
(1,050
)
2,815
(8)
453
3,260
471
12,007
257
7,026
19,290
18,819
14,822
249
7,479
22,550
19,290

The total of private restricted and collection funds represents total restricted private funds of £7,728k.

16. ANALYSIS OF NET ASSETS BETWEEN FUNDS

Fixed Assets
Cash at bank and in
hand
Other net current
assets/ (liabilities)
Creditors of more
than one year
Total		 Unrestrict
ed public
Restrict
ed
public
Unrestrict
ed private
Restrict
ed
private
Total
£’000
£’000
£’000
£’000
£’000
-
81,865
13,383
7,727
102,975
172
-
1,440
2
1,614
615
920
-
-
1,535
(27,920)
-
-
-
(27,920)
(27,133)
82,785
14,823
7,729
78,204

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63

17. RECONCILIATION OF NET INCOME/ (EXPENDITURE) TO NET CASH FLOW FROM OPERATING ACTIVITIES

----- Start of picture text -----
2020/21 2019/20
£000 £000
Net income/ (expenditure) for the reporting 3,208 808
period (as per the statement of financial
activities)
Profit on sale of investments/fixed assets (1,063) (234)
FRS 102 interest pension adjustment 430 250
Depreciation and amortisation charges 1,318 1,210
-
(Increase)/ Decrease in stock (1)
Heritage asset donations (non-cash) (453) (419)
(Increase)/ Decrease in debtors (748) (742)
(Decrease)/ Increase in creditors 502 (361)
Pension current service cost adjustment 1,340 560
Net cash flow from operating activities 4,534 1,071
----- End of picture text -----

18. ANALYSIS OF CASH AND CASH EQUIVALENTS

Bank account balances
Bank accounts held within investments
Cash and cash equivalents at 31 March		 2020/21
2019/20
£000
£000
1,614
530
1,453
2,418
3,067
2,948

19. RELATED PARTY TRANSACTIONS

The Welsh Government is regarded as a related party. During the year the Library received funding from the Government in the form of Grant in Aid, Purchase, Capital and Project Grants as disclosed in note 2. The Library owed/paid the following sums to Welsh Government: -

Details of expenditure in respect of board member travel, subsistence and hospitality are disclosed in Note 8(f).

Transactions and balances with the pension scheme are disclosed in Note 8.

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64

Related party transactions with Board members and members of the senior management team are noted in the table below.

----- Start of picture text -----
2020/21 2019/20
Related
Party Relationship Income Debtor Income Debtor
(Expenditu (Credito (Expenditu (Credito
re) r) re) r)
£ £ £ £
Coleg Mr Pedr ap 0 0 949 0
Cymraeg Llwyd, Chief
Cenedlaeth Executive of the
ol Cymru Library is a
Director.
Gwilym Dyfri
Jones, Trustee
of the Library is
a Director. Ms
Meri Huws,
Trustee of the
Library is a
Director.
National Mr David 399,924 232,682 356,812 162,816
Lottery Michael,
Heritage Director of the
Fund Library is an
independent
member of the
Audit
Committee.
Cardif Dr Janet (3,472) 0 311 / 0
University Wademan, (195)
Trustee of the
Library is a
Council
Member.
University Dr Liz Siberry, 15,884 / 13,534 1,299 0
of Wales Trustee of the (18,813)
Trinity Library is a
Saint David Council Member
Gŵyl Ms Eleri Twynog (1,200) 0 0 0
Hanes Davies, Trustee
Cymru i of the Library is
Blant a Director.
Aberystwyt Ms Meri Huws, 208 / 0 683 / 0
h Trustee of the (8,590) (9,023)
University Library is a
Council
Member.
----- End of picture text -----

At 31 March 2021, the Library had consolidated debtors and creditors with other Government financed bodies as follows:

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65

Central Government
bodies
Local Government
bodies
Non-Government
Bodies
Total		 Debtor
s
Creditors: due
in 1 year
Creditors: more
than 1 year
£000
£000
£’000
516
423
-
-
-
-
2,125
728
-
2,641
1,151
-

20. FINANCIAL INSTRUMENTS – RISK DISCLOSURE

The Library has no borrowings and relies primarily on departmental grants for its cash requirements and is therefore not exposed to liquidity risks. The only material deposit is disclosed in note 11, and all material assets and liabilities are denominated in sterling, so it is not exposed to interest rate risk or currency risk. In 2020/21, £14.255m or 82% of the Library’s consolidated income derived from the Welsh Government (2019/20 £11.813m or 81%). The balance, £3.05m or 18% (2019/20 £2.72m or 19%) is derived from income on the Library’s private funds (note 15b), from trading activities (note 4) and grants from other bodies as disclosed in Note 3 to these accounts.

The Library has exposure to market risk through its investments and this is managed through portfolio diversification as well as setting the risk appetite and investment objectives to be used by the Fund Manager.

21. LEASES

The Library made no lease payments during the year or the previous year.

22. PENSION COSTS

The Library operates a defined benefit scheme with benefits accruing at the rate of 1/80[th] of pensionable salary for each year of service. The latest full actuarial valuation was at 31 March 2019 and it was assessed that the Scheme was 100% funded.

During 2020/21, the Library contributed 27.2% of pensionable salaries and expected employer contributions for 2021/22 are £1.7 million as well as an additional contribution in the region of £400k depending on projected out-turn.

(a)Development of the Net Balance Sheet Position

31 March 31 March 2021 2020

2020

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66

2020/21
Fair value of assets (22b)
Actuarial value of scheme liabilities (22c)
Pension liability recognised in balance sheet		 £m
£m
82.45
74.14
110.37
98.63
(27.92)
(24.49)

(b)Changes in the fair value of plan assets

----- Start of picture text -----
Year Ended Year Ended
31 March 31 March
2021 2020
£m £m
Scheme assets at beginning of year 74.14 73.18
Benefits paid from plan assets (2.24) (2.15)
Employer contributions 2.09 2.10
Member contributions 0.10 0.10
Administrative costs (0.14) (0.11)
Interest income on Scheme Assets 1.33 2.12
Return on scheme assets greater/(less) than 7.17 (1.10)
discount rate
Scheme assets at end of year – (22a) 82.45 74.14
(c)Analysis of changes in the Defined Benefit Obligations (DBO)
Year Ended Year Ended
31 March 31 March
2021 2020
£m £m
Scheme liabilities at beginning of year 98.63 82.97
Interest cost on the DBO 1.76 2.37
Efect of employee services in the current 3.29 2.55
period
Member contributions 0.10 0.10
Benefits paid from plan assets (2.24) (2.15)
Remeasurement on the DBO/ change of 8.83 12.79
assumptions
Scheme liabilities at end of year – (22a) 110.37 98.63
----- End of picture text -----

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67

----- Start of picture text -----
(d)Amounts charged to SOFA (Total Expenditure)
Year Ended 31 Year Ended
March 2021 31 March
2020
£m £m
Efect of employee services in the current 3.29 2.55
period
Net interest on net defined benefit liability/ 0.43 0.25
(asset)
Defined benefit cost recognised in P&L 3.72 2.80
Administration costs during the period 0.14 0.11
Total cost recognised in SOFA 3.86 2.91
----- End of picture text -----

----- Start of picture text -----
(e) Actuarial Gains/(Losses) charged to the SOFA (Other recognised
gains/(losses))
Year Ended Year Ended
31 March 31 March
2021 2020
£m £m
Return on scheme assets (greater)/ less (7.17) 1.10
than discount rate – (22b)
Actuarial loss/(gain) arising during period – 8.83 12.79
(22c)
Total actuarial loss/(gain) recognised in 1.66 13.89
reserves
(f) Total defined benefit cost
Year Ended Year Ended
31 March 31 March
2021 2020
£m £m
Total cost recognised in SOFA – (22(d)) 3.86 2.91
Remeasurement efect recognised in 1.66 13.89
reserves (22(e))
Defined benefit cost 5.52 16.80
(g)Reconciliation of Net Balance Sheet Position
Year Ended Year Ended
31 March 31 March
2021 2020
£m £m
Net defined (liability) at beginning of year (24.49) (9.79)
Efect of employee services in the current (3.29) (2.55)
period (22c)
Net interest on net defined benefit liability/ (0.43) (0.25)
(asset)
Remeasurement efect recognised in (1.66) (13.89)
reserves (22(e))
Employer contributions (22b) 2.09 2.10
Administrative costs (22b) (0.14) (0.11)
Scheme liabilities at end of year – (22a) (27.92) (24.49)
----- End of picture text -----

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69

----- Start of picture text -----
(h)Market value of Assets and Percentage of Total Scheme Assets
31 March 2021 31 March 2020
£m % £m %
Equities 20.81 25.2 45.00 60.7
Bonds 54.71 66.4 25.95 35.0
Property and other 6.93 8.4 3.19 4.3
Total value of 82.45 74.14
assets
----- End of picture text -----

(i) Financial Assumptions

The financial assumptions made in order to calculate the FRS 102 disclosure requirements are as follows:

31 March
2021
31 March 2020
%per annum
%per annum
Price Infation
2.22
2.35
Rate of Salary Increase
2.22
2.35
Rate of increase of pensions in
payment
2.22
2.35
Discount rate
1.25*
1.80

** prescribed by HM Treasury

The discount rate used for FRS 102 disclosures is diferent to that used by the Actuary for the most recent financial assessment of the Scheme at 31 March 2019. The requirement to use the Treasury’s discount rate for the FRS 102 disclosure will result in the financial position of the Scheme being assessed diferently under this measure in comparison to the method used in the formal actuarial valuation of the Scheme.

23. CAPITAL COMMITMENTS

At the balance sheet date, the outstanding commitments are as follows:

Contracted –building work on Bookstack 1
North
Contracted –chiller replacement
Contracted –main building envelope
Contracted –professional fees
Contracted – lift replacement		 31 March
2021
31 March
2020
£000
£000
-
20
-
170
10
30
21
1,817
70
-
210
1,928

24. POST BALANCE SHEET EVENTS

70

The National Library of Wales Annual Accounts 2020/21

There were no material post balance sheet events up to the date on which the accounting statements were authorised by the Accounting Officer on 23 July 2021, which would have meant that the accounts had to be adjusted.