Brewin Dolphin Holdings plc Annual Report 2020

FY2020 Annual Report · Brewin Dolphin Holdings plc

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Agility & Resilience

Annual Report & Accounts 2020

Contents

Strategic Report
About Us
2
Chairman’s Statement
6
Our Market
10
Business Model
12
S172 Statement
14
Chief Executive Officer’s Review
18
Our Strategy
22
Key Performance Indicators
24
Financial Review
28
Environmental, Social and Governance
34
Our People and Culture
38
Corporate Social Responsibility
40
Principal Risks
44
Non-Financial Information Statement
50

Board of Directors
Corporate Governance Report
Executive Committee Report
Nomination Committee Report
Risk Committee Report
Audit Committee Report
Directors’ Remuneration Report

Governance
54
56
68
70
72
74
79
100 Directors’ Report
103 Statement of Directors’ Responsibility
104 Independent Auditor’s Report

Financial Statements
112 Consolidated Financial Statements
123 Notes to the Financial Statements

Other Information
180 Five Year Record
181 Appendix – Calculation of Key
Performance Indicators
182 Shareholder Information
183 Glossary
184 Offices

Highlights

Total income

£361.4m

2019: £339.1m

Adjusted1 profit before tax

£78.2m

2019: £75.0m

Discretionary funds

£41.2bn

2019: £40.1bn

Statutory profit before tax

£62.1m

2019: £62.6m

Adjusted1 profit before tax margin

Statutory profit before tax margin

21.6%

2019: 22.1%

17.2%

2019: 18.5%

Adjusted1 earnings per share – diluted2

Statutory earnings per share – diluted2

20.4p

2019: 20.5p

Dividend payout ratio

70%

2019: 80.0%

15.9p

2019: 16.6p

Full year dividend

14.3p

2019: 16.4p

1. Adjusted items are amortisation of client relationships and brand, defined benefit pension scheme past service

costs, acquisition costs, incentivisation awards, onerous contracts and other gains and losses. See explanation
of adjusted performance measures on page 29.

2. See note 12 to the Financial Statements.

Our vision
To become the UK and Ireland’s
leading provider of personalised
wealth and investment management
services, delivering a compelling client
proposition, rewarding careers and
sustainable shareholder returns

aintain a c u lt u
e are pr o u

Is realised by

r
d o

Our
strategy

Provid
for m

r
u

e
c
n

r t h e r develop o
n t- c e n tric experie

p
l

atfor

u
l i

F
c

Underpinned by

Our people
and culture
Read more on
pages 38 and 39

Our technology
Read more about how we
are building a platform
for growth on
pages 20 and 21

Effective risk
management
Read more about our
Principal Risks on
pages 44 to 48

www.brewin.co.uk

Brewin Dolphin

About Us

Helping create long-lasting
financial peace of mind

When times are uncertain, trusted advice is particularly important.
Our Group has been built on serving the interests of our clients and navigating
them through times of change; today, that focus remains as relevant as ever.

Our services

We provide a range of expert services to
help our clients shape their financial futures,
by protecting, growing and managing their money.
Whether they have complex financial affairs that
need bespoke wealth management, or more
straightforward needs that would be better served
with a non-advised self-investment platform,
we can provide a service that is right for them.

Our relationships

We recognise the importance of long-term
relationships. We have a network of 34 offices
in the United Kingdom, Ireland and Jersey,
enabling us to be closer to our clients. It means
we can combine the best of local understanding
with national scale and perspective.

Our history

We can trace our heritage back to 1762.
Originally a provider of stockbroking services,
since then we have grown to become one of the
leading wealth managers in the UK and Ireland.
We are listed on the London Stock Exchange
and are members of the FTSE 250.

Our evolution

We continue to develop our services to meet
the differing needs of a broader range of people,
and to identify new distribution opportunities so
we can reach them. We are building from the
knowledge we have gained working closely with
clients over many years, to enhance our services
and make them more compelling and convenient.
That includes using digital technology where
it augments the client experience, but not at the
expense of the human relationships our business
is built on.

Over
250
years’
experience

2,152
employees

34
offices

Brewin Dolphin

Annual Report and Accounts 2020

Our business
at a glance

We hold £47.6 billion on behalf of our clients. We provide our services directly,
or indirectly through an intermediary such as an IFA, enabling people to access
our expertise in a way that works for them.

Indirect

Intermediaries
£14.5bn

Direct

Private clients
£28.0bn

Charities
and corporates1
£5.1bn

Services:

Managed Portfolio Service (‘MPS’)
Designed and managed
investment portfolios

Voyager fund range
Designed and managed
investment funds

Discretionary
fund management (‘DFM’)
Bespoke investment management

Brewin Portfolio Service (‘BPS’)
Non-advised digital investment platform

WealthPilot
A simplified financial planning
and investment management service

Wealth management2
Bespoke financial planning
and investment management

1762
Advice-led wealth management
for complex needs

Other
Expert witness report service
Advisory
Execution only3

1. Investment management.
2. Each service available separately.
3. Only provided for existing clients and Brewin Dolphin Wealth Management Limited clients.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther Information
Agility & Resilience
Strategic
Report

Brewin Dolphin delivered a resilient
set of results this year, despite the
challenges the COVID-19 pandemic
imposed on its business.”

Simon Miller
Chairman

Brewin Dolphin

Annual Report and Accounts 2020

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationChairman’s Statement

Agility & Resilience:
Strong values in di∞cult times

(2019 final: 12.0p per share; total dividend for the 2019 year
16.4p per share). This represents a payout ratio of 70%
of adjusted diluted earnings per share and is in line with our
dividend policy.

Values-based decision making

A unique culture lies at the heart of the Brewin Dolphin business.
It influences how we behave, the way people are treated,
decisions are made and how we plan for the future. It guides the
way we deal with our clients, our shareholders, our suppliers and
the communities in which we live and work. It encourages
openness, fairness, integrity and care.

Our actions were reflected in the results of the annual “Your
Future, Your Say” employee survey, increasing our engagement
score to 90%, up from 87% last year. Our score is 13 points
above the financial services benchmark. I am particularly proud
that 89% of respondees say senior leaders provide a clear vision
of the overall direction of Brewin Dolphin, 25 points above the
financial services benchmark.

The Board initiated an Environmental, Social and Governance
(‘ESG’) review at the start of the year to address how the
business responds to ESG related matters at the corporate
level and what responsible investments we can offer clients.
The formation of a Sustainability team this year will improve our
focus and initiatives in this area. (Refer to the ESG section on
page 34 for further information)

The close connection between Brewin Dolphin and the
communities in which it operates is an important demonstration
of how the business approaches its wider responsibilities.
This year in particular has seen a notable increase in the level
of activity undertaken across a range of community-focused
areas. Further information on our volunteering, fundraising and
payroll giving can be found on page 40 in the Corporate Social
Responsibility section.

Leadership succession

David Nicol stepped down as Chief Executive on 14 June 2020
after seven years leading the business and remained with the
Group for a transitionary period until 29 July 2020. He was an
outstanding leader and a key contributor to Brewin Dolphin’s
success. He demonstrated great professionalism, re-focused the
Group’s strategy, improved the operational processes of the
organisation and built a strong leadership team.

Robin Beer stepped into the Chief Executive Officer role on
15 June 2020, having joined Brewin in 2008 and the Executive
Committee in 2016. He is the ideal person to continue the
execution of our strategy, whilst sustaining and nurturing our
well-established client-focused approach.

Board composition

During the year Phillip Monks was appointed to the Board as
a Non-Executive Director. He is currently the Chief Executive
Officer of Aldermore Group PLC. His banking career spans more
than three decades. Kath Cates has indicated that she will step
down at the AGM. She has made a huge contribution to the

Simon Miller
Chairman

Dear Shareholder

Brewin Dolphin delivered a resilient set of results this year,
despite the challenges the COVID-19 pandemic imposed on its
business. The Group responded with speed and professionalism,
prioritising the health and safety of its employees and clients.

A strong client-centric culture has been the driving force behind
the Group’s resilience and flexibility. We were able to move to
a remote operating model within days. Immediate attention was
given to clients as financial advice was required more than ever.

Performance

Total funds grew to £47.6 billion. Discretionary funds increased
to £41.2 billion, with funds from acquisitions and positive net
flows offset by negative investment performance in challenging
markets. Strong total discretionary funds inflows were £2.8 billion
(2019: £2.8 billion) with net flows of £0.9 billion representing an
annualised growth rate of 2.2%. The Financial Review contains
further information about this year’s performance on pages 28
to 33.

Dividend

The Board recognises the importance of dividends to shareholders
and the benefit of providing sustainable shareholder returns.

The Group has an established dividend policy to grow dividends
in line with adjusted earnings, with a target payout ratio of
between 60% to 80% of annual adjusted diluted earnings per
share (see page 29 for an explanation of adjusted measures).
The payout range has been adopted to provide sufficient flexibility
for the Board to remunerate shareholders for their investment
whilst recognising that there may be a requirement, at times,
to retain capital within the Group.

The Board has taken a balanced view on rewarding shareholders
in what has been a strong performance by the Group in the year,
against a challenging backdrop. The Board recognises that
it needs to invest in the business for the future to remain relevant
for its clients in a fast changing world, but also needs to remain
prudent as we envisage some continuous headwinds into
next year. As a result, the Board is proposing a final dividend
of 9.9p per share bringing the total for 2020 to 14.3p per share

Brewin Dolphin

Annual Report and Accounts 2020

A strong client-centric culture
has been the driving force behind
the Group’s resilience and flexibility.”

Simon Miller
Chairman

Group both as a Non-Executive Director and as Chairman of the
Risk Committee. Simonetta Rigo resigned on 13 November 2020
in order to take up an executive role. Charlie Ferry, who is
Managing Director of Wealth and Investment, will join the Board
after the AGM in 2021, subject to regulatory approval.

The events have also driven unprecedented volatility, measured
by the VIX index, which at its peak was 82.7, a level not seen
since the global financial crisis of 2008. There continues to be
further economic uncertainty as we enter a second lockdown
which will weigh on economic recovery.

After almost 15 years on the Board, with the last eight years as
Chairman, it is the right time for me to retire. The Board initiated
a process during the calendar year 2020 for the appointment of
a successor led by Ian Dewar, Senior Independent Non-Executive
Director. The search was successful and I am pleased to
announce the appointment of Toby Strauss, who, subject to his
election at our 2021 AGM, will succeed me as Chairman of the
Board with effect from close of business on 5 February 2021.
Toby brings a wealth of experience from an extensive executive
career in the UK financial services sector.

The Group’s results are impacted by the retention and flow
of funds, which is a function of the consistency and quality of our
offering. Demand for quality services in our industry remains high
and the need for advice continues to increase. Our business is
well placed to take market share and support clients through this
changing landscape. Client satisfaction levels remain high and
you will see from the results that we continue to retain and attract
new business.

Annual General Meeting (AGM)

I am honoured to have fulfilled the role of Chairman for the last
eight years and am proud of the Board, the Executive Committee
and each and everyone who works for Brewin Dolphin. Brewin
Dolphin is a strong and forward-looking Group with a vibrant
culture and I am confident that its growing success will continue
and gather pace.

This year’s AGM will be held on 5 February 2021, it will be
broadcast via a webinar and we encourage shareholders
to watch and listen to the proceedings. We endeavour to
maintain a regular dialogue with our shareholders, large and
small, and your views are always most welcome. Further details
can be found in the Notice of AGM.

Looking forward to 2021

The market has been dominated by several external events,
the UK general election in December 2019 combined with Brexit
and the impact of the COVID-19 pandemic. This has contributed
to significant market volatility and economic uncertainty.
The FTSE 100 index rose to 6,815 in early March and by the
end of that month had fallen to 4,994, a movement of 27%.

Simon Miller
Chairman

24 November 2020

COVID-19 response

The COVID-19 pandemic highlighted what is already a unique
culture at Brewin Dolphin and all decisions made during the
crisis were values-based. We have supported our people
throughout the crisis placing no one on furlough nor utilising
the Government support scheme.

Employees were kept up-to-date via various communication
channels, and our human resources team worked hard to roll
out various initiatives to support colleagues with their personal
and financial wellbeing and change of working environment.
These included:

stress management, working from home, educating and
entertaining children, and staying connected.

• Sick leave entitlement has been doubled for those with under

a year’s service.

Support for learning:

• We continued our wide range of learning and development,

moving it into ‘virtual classrooms’.

• Specialist learning materials created to cover areas such

as how to serve clients during the crisis.

Employment:

Communities:

• No employees have been furloughed or made redundant

as a result of COVID-19.

• Volunteering days temporarily increased to five days per year.
• Donations to the National Emergencies Trust and the

• We have made an emergency interest-free loan available

Community Foundation to Ireland.

to lower paid employees.

• Enhanced flexibility for employees who need to care for

dependents including additional paid time off.

Morale, wellbeing and connection:

• Launch of the ‘Brewin Dolphin Community Relief Fund’:
£25,000 made available for employees to apply for £250
donations for small local charities in their communities
responding to the COVID-19 crisis.

• A full programme of wellbeing and morale

communications was produced. Subjects included exercise,

Read more in the CEO Review
on page 18

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther Information

Key Performance Indicators

Measuring the
success of our strategy

Delivery of our strategy is measured through focused and select KPIs
that demonstrate continued progress to build and grow our business.

Measuring our performance

Key Performance Indicators (‘KPIs’) are used to measure both the
progress and success of our strategy implementation. The KPIs
are set out below, with a measure of our performance to date and
an indication of potential challenges to success where applicable.

Changes to KPIs

During the year, we have reviewed our measurements to ensure
that they are appropriate for our strategy. Whilst all the KPIs
remain appropriate, we have amended the description for the
discretionary funds per CF30 measure to discretionary funds
per Client Facing Certified Person; the population of individuals
captured is the same.

As we are increasingly focused on becoming an advice-led
business, this means that while we continue to be driven by funds
growth, total revenue is a measure that captures the entirety of
the business. We have always monitored revenue so this will form
an additional KPI as part of our focus on growing the business.

Similar to our adjusted diluted EPS there will be no target
provided but this will form part of our remuneration decision
making and will be disclosed and monitored.

KPIs and remuneration

The KPIs for discretionary funds inflow and adjusted1 PBT margin
are included in remuneration decision making; see the Directors’
Remuneration Report for further details.

Read more for a detailed explanation of the calculations used
for KPIs see page 181

Revenue growth RG

Discretionary funds
inflows (%)

Net promoter
score (%)

Overall client
satisfaction

Target 5%

Benchmark 38.0%

Benchmark 8.4/10

Definition The value of annual net inflows
as a percentage of opening funds for our
discretionary service.

Performance during the year Positive
net fund inflows of £0.9 billion. Though
2020 net inflows are tracking behind our
5% target, it is a resilient result against the
backdrop of challenging market conditions.

Potential challenges Failure to
successfully execute on the growth
strategy for attracting direct inflows.

Definition An indication of how likely
clients are to recommend us. Scored from
-100% to +100%, measured by a client
survey conducted by an independent
third party.

Performance during the year This year
saw a score of 51.0%. This is a stable
result and the score remains significantly
ahead of the industry benchmark of
38.0% which has reduced year on
year (2019: 46.0%).

Potential challenges Failure to maintain
a positive reputation may adversely impact
client loyalty.

Definition An indication of overall client
satisfaction as a score out of 10, measured
by a client satisfaction survey conducted
by an independent third party.

Performance during the year This year
saw a score of 8.7/10, once again above
the industry benchmark for the year of 8.4.
This score is consistent with prior years
and demonstrates the level of service we
provide to clients.

2020

2.2

2019

2018

3.7

6.8

2020

2019

2018

51.0

51.2

44.3

2020

2019

2018

8.7

8.6

8.5

Brewin Dolphin

Annual Report and Accounts 2020

Improved efficiency

Adjusted1 PBT
margin (%)

Target 25%

Definition Reported total annual adjusted
profit before tax as a percentage of
total income.

Performance during the year Adjusted
PBT margin is lower than 2019. Income
growth has been offset by an increase in
staff costs driven by higher headcount to
support growth initiatives and inflationary
pay rises.

Potential challenges Failure to
achieve further growth combined with
changes in investment market and
economic conditions.

Discretionary funds per
Client Facing Certified
Person (£m)

Target £100m

Definition The year end total value
of client funds in our discretionary service
divided by the year end number of
client-facing professional investment
managers and financial planning staff
(‘Client Facing Certified Persons’/’CFCPs’).

Performance during the year The Group
has increased the number of CFCPs
through the acquisition in Ireland in the
year. Excluding acquisitions, the measure
would have been £80m, a marginal
decrease on prior year due to negative
investment performance.

Employee engagement (%)

Benchmark 77%

Definition A survey that measures overall
employee engagement on matters that
affect them, measured by a specialist
external company. The survey is
benchmarked against other financial
services firms.

Performance during the year The
employee engagement survey undertaken
in 2020 resulted in a score of 90%,
a 3 point increase over the 2019 result
and 13 points ahead of the benchmark –
see page 38 for more details.

Potential challenges Failure to engage
our employees effectively could impact
productivity and could result in loss of
key staff.

2020

2019

2018

21.6

22.1

23.6

2020

2019

2018

2020

2019

2018

Capital efficiency and shareholder return CS

Capital adequacy risk
appetite ratio (%)

Adjusted1,2 diluted
EPS (p)

Minimum 150%

Target n/a

Dividend payout
ratio (%)

Target 60-80%

Definition The risk appetite is defined
as a percentage of the Group’s year end
total regulatory capital resources to
the year end minimum total regulatory
capital requirement.

Performance during the year Our capital
adequacy risk appetite ratio remains
well above the risk appetite of 150%.
Although it has reduced in the year
following an increase in intangible
assets with the purchase of BDCIIL
and significant investment in software.

Definition The reported adjusted diluted
earnings per share.

Performance during the year The
adjusted diluted EPS is broadly flat
compared to last year.

Potential challenges In the longer term,
failure to effectively execute our growth
strategy. In the short term, investment
market conditions are the biggest driver
of our income and therefore of earnings.

Definition The total annual dividend per
share (interim and final) as a percentage
of annual adjusted diluted EPS.

Performance during the year The
dividend payout ratio for the year is at the
middle of the target range.

Potential challenges Need to retain
capital for investments. Failure to maintain
capital strength and profitability.

2020

2019

2018

220

234

291

2020

2019

2018

20.4

20.5

21.7

2020

2019

2018

1. Adjusted items are amortisation of client relationships and brand, defined benefit pension scheme past service costs, acquisition costs, incentivisation awards,

onerous contracts and other gains and losses - see page 29 for further information.

2. See note 12 to the Financial Statements.

www.brewin.co.uk

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Bukki Sobowale
London

Agility & Resilience:

Pushing ahead with
new technology

WealthPilot is our service for people with straightforward financial planning needs.
Developing a digital platform for the service provides many advantages. Bukki Sobowale
led the project team.

Three phases

WealthPilot is a really powerful system because it brings together both the client and the
adviser in one system. Once the data has been entered and submitted it is there for the
adviser to review and work with.

This year there have been three distinct phases to getting the platform ready for delivery.
The first was to roll out the adviser half of the system – so that our team would get used
to using the data we have on existing clients. The second was a low-key launch of the
client-facing portal, which we used as a further testing period with friends and family to
take on user feedback. And the third has been to launch “navigated journeys” for clients,
which means that we talk them through the system and how it works before they use it
to complete their details.

It’s been a really busy year, but we’ve delivered a lot – and fortunately we were able to
continue almost seamlessly through lockdown. The system is browser based so it has
been straightforward to continue testing without interruption; the only thing we missed
was seeing the team!

Brewin Dolphin

Annual Report and Accounts 2020

Shahbear Hussain
Bristol

Agility & Resilience:

Working together to introduce
business-wide change

The introduction of Client Engage, our new client management system, was one of the
biggest change projects undertaken at Brewin Dolphin. It involved teams across the firm
working together. Shahbear Hussain worked on the system requirements and
implementation with the Jersey office.

Linking teams across the business

Obviously a huge part of these projects is getting the technology right, but another is
being clear on the processes that need to change so that we get the best out of that
technology – and trying to make everything as efficient as possible for the teams that
need to use it.

So there was a lot to do so that everything could go smoothly with no impact upon
clients – from working through the new process flows to check that they all worked
smoothly with no gaps, to checking that everyone has had the necessary training,
and that all the data had been prepared for the actual migration to Client Engage.

I was only a small part of what was a huge programme, but it was a really great team
to be a part of. My role wasn’t necessarily to be the expert, but to enable the right
conversations to be had so that we got the right result for our clients.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationFinancial Review

Agility & Resilience:
Solid set of results for the year

Results and business performance

The Group’s financial performance for the year to
30 September 2020 was resilient, delivering organic growth
across our business channels against a backdrop of a pandemic,
economic uncertainty and market volatility.

Profit before tax and adjusted items (‘adjusted PBT’) was up
4.3% to £78.2m (2019: £75.0m) reflecting the contributions from
our acquisitions, continued organic growth and the cost savings
we realised within the second half of the year. The adjusted PBT
margin was 21.6% (2019: 22.1%) as the business continues to
invest in its technology infrastructure to support future growth.

The Group’s performance for the
year was resilient, delivering organic
growth across our business channels
against a backdrop of a pandemic.”

Siobhan Boylan
Chief Financial Officer

Brewin Dolphin

Annual Report and Accounts 2020

,Statutory profit before tax (‘statutory PBT’) was 0.8% lower than
last year at £62.1m (2019: £62.6m). Statutory PBT margin for the
period was 17.2% (2019: 18.5%).

Adjusted diluted earnings per share (‘EPS’) was broadly flat
at 20.4p (2019: 20.5p). Statutory diluted EPS declined by 4.2%
to 15.9p (2019: 16.6p).

2020
£’m
361.4
(139.2)
(60.2)

2019
£’m
339.1
(126.7)
(58.2)

Change
6.6%
9.9%
3.4%

(82.1)

(80.8)

1.6%

79.9

73.4

8.9%

(1.7)

1.6

(206.3)%

78.2
(16.1)
62.1
(14.1)
48.0

75.0
(12.4)
62.6
(14.5)
48.1

4.3%
29.8%
(0.8)%
(2.8)%
(0.2)%

Income
Fixed staff costs
Variable staff costs
Other operating costs
excluding adjusted1 items
Operating profit before
adjusted1 items

Net finance costs and other
gains and losses
Profit before tax and
adjusted1 items
Adjusted items
Profit before tax
Taxation
Profit after tax

Earnings per share
Basic earnings per share
Diluted earnings per share
Adjusted2 earnings
per share
Basic earnings per share
Diluted earnings per share

21.1p
20.4p

21.2p
20.5p

(0.5)%
(0.5)%

1. Adjusted items are amortisation of client relationships and brand,

defined benefit pension scheme past service costs, acquisition costs,
incentivisation awards, onerous contracts and other gains and losses.

2. See note 12 to the Financial Statements.

Explanation of profit before tax and adjusted items
and reconciliation to Financial Statements

Profit before tax and adjusted items (‘adjusted PBT’), adjusted
diluted EPS and adjusted PBT margin (‘adjusted measures’)
are used to measure and report on the underlying financial
performance of the Group, aiding comparability between
reporting periods. The Board and management use adjusted
measures for planning and reporting. They are also useful
measures for investors and analysts.

Additionally, some of the adjusted performance measures are
used as Key Performance Indicators, as well as for performance
measures for various incentive schemes, including the annual
bonuses of Executive Directors and long-term incentive plans.

These adjusted profit measures are calculated based on statutory
PBT adjusted to exclude various infrequent or unusual items
of income or expense. The Directors consider such items to be
outside the ordinary course of business. Income or expenditure
adjusted for are shown in the reconciliation below and meet
the criteria.

Some adjusted for items of income or expense may, like onerous
contracts costs, recur from one period to the next. Although
these may recur over one or more periods, they are the result
of events or decisions which the Directors consider to be outside
the ordinary course of business, such as material restructuring
decisions to reduce the ongoing cost base of the Group that
do not represent long-term expenses of the business. Likewise,
costs related to acquisitions are also infrequent by their nature
and therefore are excluded. Incentivisation awards costs in
relation to acquisitions that are payable for a predetermined
period of time are adjusted for on this basis.

Additionally, the amortisation of acquired client relationships
and brand is an expense which investors and analysts typically
add back when considering profit before tax or earnings per
share ratios.

Reconciliation of profit before tax and adjusted
items to statutory profit before tax

Acquisition costs
Defined benefit pension scheme past
service costs
Onerous contracts
Incentivisation awards
Amortisation of intangible assets – client
relationships and brand

Total adjusted items
Statutory profit before tax

2020
£’m
78.2

2019
£’m
75.0

(3.6)

(2.3)

–
(0.2)
(1.2)

(11.1)
(16.1)
62.1

(1.9)
(1.0)
(0.3)

(6.9)
(12.4)
62.6

Adjusted items for the year were higher at £16.1m
(2019: £12.4m) and included acquisition costs of £3.6m
(2019: £2.3m) for the acquisition during the year and higher
amortisation of client relationships of £11.1m (2019: £6.9m)
due to the acquisitions made in the 2019 calendar year.

Other adjusted items were in relation to incentivisation awards
of £1.2m and onerous contracts of £0.2m.

16.3p
15.9p

17.0p
16.6p

(4.1)%
(4.2)%

Profit before tax and adjusted items
Adjusted items

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Brewin Dolphin

,Strategic ReportGovernanceFinancial StatementsOther Information

Financial Review continued

Funds

£’bn
Private clients
Charities & corporates
Direct discretionary
Intermediaries
MPS
Indirect discretionary
Total discretionary
Execution only
BPS
Advisory
Total funds

30 September
2019
21.4
4.9
26.3
10.0
3.8
13.8
40.1
3.9
0.2
0.8
45.0

Inflows
1.1
0.3
1.4
0.9
0.5
1.4
2.8
0.2
–
0.1
3.1

Outflows
(0.6)
(0.3)
(0.9)
(0.5)
–
(0.5)
(1.4)
(0.5)
–
(0.1)
(2.0)

Internal

transfers1 Net flows
(0.2)
0.3
0.1
0.3
0.5
0.8
0.9
0.2
–
–
1.1

(0.7)
0.3
(0.4)
(0.1)
–
(0.1)
(0.5)
0.5
–
–
–

Growth
rate
(0.9)%
6.1%
0.4%
3.0%
13.2%
5.8%
2.2%
5.1%
–%
–%
2.4%

Acquired
0.7
0.3
1.0
–
–
–
1.0
0.5
–
1.2
2.7

Investment
performance
(0.3)
(0.4)
(0.7)
(0.2)
0.1
(0.1)
(0.8)
(0.5)
–
0.1
(1.2)

30 September

Change
2020
0.9%
21.6
4.1%
5.1
1.5%
26.7
1.0%
10.1
15.8%
4.4
5.1%
14.5
2.7%
41.2
5.1%
4.1
–%
0.2
2.1 162.5%
5.8%

47.6

1. Charities and corporates internal transfer includes a £0.3bn reclassification from private clients related to Brewin Dolphin Wealth Management Limited.

Indices
MSCI PIMFA Private Investor Balanced Index
FTSE 100

30 September
2019
1,665
7,408

30 September
2020
1,568
5,866

Change
(5.8)%
(20.8)%

Total funds as at 30 September 2020 were up 5.8% over
the last year to £47.6bn (2019: £45.0bn) and up 15.0% from
31 March 2020. The increase was driven by strong total net fund
flows of £1.1bn and acquired funds from BDCIIL of £2.7bn.
Negative investment performance of £1.2bn due to an
unprecedented fall in markets due to COVID-19, offset positive
net flows. The MSCI PIMFA Private Investor Balanced Index fell
by 5.8% and the FTSE 100 Index fell by 20.8% during the year.

Direct discretionary positive net flows of £0.1bn in the period
(2019: £0.3bn) with fund inflows of £1.4bn (2019: £1.2bn),
were partially offset by transfers and elevated outflows including
low-margin institutional clients of £0.1bn. Direct funds growth
benefitted from strong integrated inflows, aided by the 1762
from Brewin Dolphin proposition and contribution from BDCIIL.
There is continued demand for advice, with c.60% of new direct
private client business taking integrated wealth advice services.

Total discretionary funds as at 30 September 2020 were up 2.7%
at £41.2bn (2019: £40.1bn) with positive net flows of £0.9bn
(2019: £1.4bn), representing an annualised growth rate of 2.2%.
Gross fund inflows for the period remained stable at £2.8bn
(2019 £2.8bn). Total discretionary funds also included £1.0bn
from the BDCIIL acquisition.

Income

Indirect discretionary net flows were £0.8bn (2019: £1.1bn),
remaining relatively strong considering difficult market conditions,
with 62.5% of net flows coming from MPS.

Income increased 6.6% to £361.4m (2019: £339.1m) and included £19.8m from recent acquisitions. Income was higher in the second
half of the year due to higher commission and fee income due to higher market levels.

£’m
Private clients
Charities & corporates
Direct discretionary
Intermediaries
MPS
Indirect discretionary
Total discretionary
Financial planning
Execution only
BPS
Advisory
Other income
Income

2020

Fees Commission
65.3
3.6
68.9
1.1
n/a
1.1
70.0
n/a
6.7
n/a
1.1
n/a
77.8

141.5
18.4
159.9
66.5
11.2
77.7
237.6
n/a
4.6
1.3
3.6
n/a
247.1

Total
206.8
22.0
228.8
67.6
11.2
78.8
307.6
33.1
11.3
1.3
4.7
3.4
361.4

Fees
136.6
19.4
156.0
66.6
9.1
75.7
231.7
n/a
4.1
1.2
2.1
n/a
239.1

2019

Commission
58.6
2.9
61.5
1.1
n/a
1.1
62.6
n/a
6.2
n/a
0.4
n/a
69.2

Total
195.2
22.3
217.5
67.7
9.1
76.8
294.3
27.5
10.3
1.2
2.5
3.3
339.1

Fees
3.6%
(5.2)%
2.5%
(0.2)%
23.1%
2.6%
2.5%
n/a
12.2%
8.3%
71.4%
n/a
3.3%

Change

Commission
11.4%
24.1%
12.0%
-%
n/a
-%
11.8%
n/a
8.1%
n/a
175.0%
n/a
12.4%

Total
5.9%
(1.3)%
5.2%
(0.1)%
23.1%
2.6%
4.5%
20.4%
9.7%
8.3%
88.0%
3.0%
6.6%

Brewin Dolphin

Annual Report and Accounts 2020

Discretionary income increased by 4.5% to £307.6m (2019: £294.3m), driven by higher trading volumes from market volatility in Q2 20
and Q3 20 with commission income up £3.8m (excl. acquisitions) on prior year.

Financial planning income grew 20.4% to £33.1m (2019: £27.5m) primarily due to the growth in 1762 from Brewin Dolphin alongside
the recent financial planning-led acquisitions which contributed £4.0m in the year.

Advisory income is up £2.2m on FY 2019, driven predominantly by the acquisition of BDCIIL.

Other income consisting of, inter alia, interest and report writing income is broadly flat in the year at £3.4m. Interest income reduced
to £1.3m (2019: £2.8m) although higher in the second half, as interest payments to clients ceased due to a fall in the base rate. Report
writing income is generated by Mathieson Consulting acquired in H2 2019 and contributed £1.1m of other income (2019: £0.5m).

Income margin1

(bps)
Private clients
Charities & corporates
Direct discretionary
Intermediaries
MPS
Total discretionary
BPS
Execution only
Advisory
Overall

2020

Fees Commission
31.1
67.4
7.2
37.7
26.6
61.8
1.1
67.9
–
26.5
17.6
59.7
–
68.4
16.4
11.4
6.0
19.5
17.0
53.7

Total
98.5
44.9
88.4
69.0
26.5
77.3
68.4
27.8
25.5
70.7

2019

Commission
28.8
6.1
24.5
1.1
–
16.4
–
16.2
4.3
16.1

Fees
67.0
40.9
62.1
69.4
27.0
60.8
68.6
10.8
23.8
55.7

Total
95.8
47.0
86.6
70.5
27.0
77.2
68.6
27.0
28.1
71.8

1. The income margins are calculated as total income over the average funds at the end of each fee billing quarter for the year.

The overall blended margin across all our discretionary services increased to 77.3bps (2019: 77.2bps), driven by pricing pressure and
tiering within intermediaries offset by greater transactional commission-based activity. The margin for direct discretionary business has
increased to 88.4bps (2019: 86.6bps) driven by exceptional commission income in the year.

Both intermediary and MPS margin has declined reflecting the slight shift in pricing mix as a result of market competition. The blended
margin for MPS has decreased to 26.5bps (2019: 27.0bps) due to the impact of tiering as the MPS funds grow.

Operating costs (excluding adjusted1 items) and capital expenditure

Staff costs
Non-staff costs
Fixed costs
Variable staff costs
Total operating costs

Capital expenditure2

2020
£’m
(139.2)
(82.1)
(221.3)
(60.2)
(281.5)

2019
£’m
(126.7)
(80.8)
(207.5)
(58.2)
(265.7)

35.6

16.7

1. Adjusted items are amortisation of client relationships and brand, defined benefit pension scheme past service costs, acquisition costs, incentivisation awards,

onerous contracts and other gains and losses.
2. Excludes £1.9m of right of use asset additions.

Total operating costs before adjusted items were up £15.8m, 5.9% higher at £281.5m (2019: £265.7m), with increases attributable
to recent acquisitions of £13.9m and other increases such as FSCS levy as well as inflationary pay rises partially offset by cost savings
in the second half of the financial year.

Total fixed costs have increased by £15.2m to £221.3m (2019: £207.5m) with incremental costs through acquisitions totalling £12.7m.
Of the £12.5m increase in staff costs, £7.5m reflects the impact of acquisitions which included around 100 additional staff over the
period. Excluding acquisitions, staff costs grew 3.9% as a result of annual salary inflation and headcount increases to support the
Group’s continued growth including the delivery of the planned infrastructure projects.

The increase in non-staff costs is attributable to acquisitions and a £2.0m increase in the FSCS levy charged in the year. Excluding
acquisitions, non-staff costs were down £4.0m year on year with significant savings attributable to both the impact of COVID-19 and
management actions. Savings included reduced travel, entertainment, marketing, a slowdown of hiring, and delayed non-essential IT
projects and office upgrades. With this cost discipline we were able to save £9m, ahead of the cost savings target of £6m-£8m set at
the half year. Most of these savings were one-off in nature, however we expect that some travel and expenses savings will emerge while
social distancing is in place.

Variable staff costs of £60.2m (2019: £58.2m), which predominantly includes discretionary profit share, were up 3.4%, in line with the
increase in adjusted profit.

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Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationFinancial Review continued

We have continued to make good progress on our strategic
projects. Total capital expenditure for the year excluding IFRS 16
related right of use additions was £35.6m and included £5.3m
spend on our client management system and £20.9m on the
custody and settlement system. The implementation delay in our
custody and settlement system resulted in slightly higher capex
spend compared against our guidance range of £30m-£33m.

Delivery of the custody and settlement system is expected in the
Autumn of 2021 taking into account the complexities of the
integration in a remote working environment and the extension
on the scope of the project. The initial scope of the project has
expanded following the delivery of our client management system,
as we are adding incremental solutions to improve client
experience and further enhance our regulatory compliance.
These solutions include integration of a new client reporting suite
and the introduction of a new automated client account transfer
process which will drive further benefits.

Looking ahead to next year’s cost and capital expenditure,
we anticipate operating costs to grow mid-single digit, half of
which includes inflation and the remaining for investment within
the business. We anticipate our capital expenditure will be around
£30m of which £19m will be on our custody and settlement
system and £3m on property including the fit out of our new
London head office, Cannon Street, and the remainder is in line
with our guidance of a more normal investment spend of
£8m-£10m. This capital expenditure guidance excludes any right
of use asset additions.

Defined benefit pension scheme (the ‘Scheme’)

The final salary pension scheme surplus has increased to
£20.3m (2019: £17.4m). An actuarial gain for the year of £1.4m
(2019: £5.6m) has been recognised.

Under International Accounting Standard 19 (‘IAS 19’), large
annual fluctuations can occur. The increase in the surplus has
been driven by contributions to the Scheme, updated post-
retirement mortality assumptions that incorporate the latest
mortality projection models, updated cash commutation
assumption and asset returns have been higher than expected
over the year mainly as a result of hedging assets matching the
Scheme’s funding liabilities. These increases were partially
offset by an increase in the value of liabilities reflecting the
application of a lower discount rate as a result of the fall in
corporate bond yields.

The Scheme de-risked its investment strategy upon meeting
a secondary funding level target during the year at the end
of November 2019. The investment strategy reflects the
Scheme’s liability profile and the Trustees’ and Group’s attitude
to risk. The Scheme’s investment strategy is currently to invest
broadly 30% in higher return seeking assets (e.g. equities,
high yielding bonds etc.), 20% in a cash flow generating
corporate bond fund and 50% in matching assets (e.g. fixed
interest gilts and index-linked gilts).

The Group has a further £0.3m of additional contributions to pay
into the Scheme.

IFRS 16 leases and net finance costs

Tax

IFRS 16, the new accounting standard for leases, was applicable
to this year’s results and covers operating leases. All of the
properties used by the Group are on operating leases.

The Group’s effective corporation tax rate at 22.7% is higher than
the UK statutory rate of 19%, as a result of disallowable expenses
such as the amortisation of client relationships.

The adoption of the accounting standard has resulted in the
Group recognising right of use assets and corresponding lease
liabilities on its balance sheet. Additionally, the standard has
changed the pattern of recognition of costs in relation to these
assets; instead of expensing the rental cost on a straight line
basis within operating expenses, depreciation is recognised on
right of use assets with finance costs recognised in respect
of lease liabilities. This means that operating leases are more
expensive in their earlier years reflecting the finance costs.
The impact of this change in accounting decreased profit before
tax by approximately £1.1m in 2020.

Finance costs were £2.6m (2019: £0.1m). £2.3m of the increase
is due to IFRS 16 and the remainder relates to the unwind of
interest costs on provisions. Finance income for the year at £0.9m
(2019: £1.7m) was lower due to the fall in interest rates.

Right of use asset additions of £1.9m were recognised in the year
for new leases.

Acquisitions

During the year, the Group completed the acquisition of Investec
Capital & Investments (Ireland) Limited, the wealth management
business of Investec Group in Ireland. This cements our position
in the Irish wealth market and provides us the business from
which to grow and expand. The net consideration after
adjustments for surplus capital was €43.4m. Assets under
management and advice on acquisition were £2.7bn at
31 October 2019. The assets were transferred to Brewin Dolphin
Wealth Management Limited in April 2020 and are now part of
our business in Ireland. The adjusted profit before tax of the
combined entities is £5.1m.

Our effective tax rate is lower than prior year (2019: 23.1%) due
mainly to a reduction in disallowable entertainment expenses
because of COVID-19 restrictions.

Dividend

The Company’s policy is to grow dividends in line with adjusted
earnings, with a target payout ratio of between 60% and 80%
of annual adjusted diluted earnings per share.

The Board has taken a balanced view on rewarding shareholders
in what has been a strong performance by the Group in the year,
against a challenging backdrop. The Board recognises that it
needs to invest in the business for the future to remain relevant
for its clients in a fast changing world, but also needs to remain
prudent as we envisage some continuous headwinds into next
year. As a result, the Board is proposing a final dividend of 9.9p
per share bringing the total for 2020 to 14.3p per share (2019
final: 12.0p per share; total dividend for the 2019 year 16.4p per
share). This represents a payout ratio of 70% of adjusted diluted
earnings per share and is in line with our dividend policy.

Before the Board proposes any interim or final dividend it satisfies
itself that there will be sufficient distributable reserves in the
Company at the respective payment dates.

The Company is the parent company of the Group and is
a non-trading investment holding company. It derives its
distributable reserves from dividends received from its
subsidiaries, of which Brewin Dolphin Limited is the principal
operating subsidiary.

The distributable reserves of the Company comprise £38.4m
of the merger reserve (see note 29 to the Financial Statements)
and £124.8m of the balance of the profit and loss reserve.

Brewin Dolphin

Annual Report and Accounts 2020

Cash outflow for own share ‘matching’ purchases in the year
of £8.2m to match the awards made in 2019 for the Deferred
Profit Share Plan (DPSP) awards was broadly similar to the cost
last year. Shares were also purchased (£0.2m) for the Share
Incentive Plan.

Dividends paid in the period increased by 5.2% to £48.4m
(2019: £46.0m).

Profit before tax and adjusted items
Finance income and costs
Operating profit before adjusted items (EBIT)
Share-based payments
Depreciation and amortisation – excluding
client relationships and brand
Adjusted EBITDA
Capital expenditure
Purchase of client relationships
Acquisition of subsidiary
Acquisition costs
Proceeds from disposal of investments
Pension funding
Working capital
Interest and taxation
Lease payments and interest on lease liabilities
Lease incentive and finance lease
receivables
Adjusted items
Placing of shares
Shares purchased and disposed of
Shares issued for cash
Cash flow pre-dividends
Dividends paid
Cash flow
Opening firm’s cash
Closing firm’s cash

2020
£’m
78.2
1.7
79.9
9.8

9.8
99.5
(28.9)
–
(32.0)
(3.6)
–
(1.3)
0.3
(16.4)
(8.8)

0.6
(1.4)
–
(8.4)
0.1
(0.3)
(48.4)
(48.7)
229.2
180.5

2019
£’m
75.0
(1.6)
73.4
7.8

3.9
85.1
(15.3)
(10.0)
(2.7)
(2.3)
0.8
(2.0)
(2.4)
(10.9)
–

–
(0.9)
58.4
(8.9)
0.1
89.0
(46.0)
43.0
186.2
229.2

The Group is well positioned to continue funding dividend
payments in accordance with the dividend policy. The ability to
maintain future dividends will be influenced by a number of the
principal risks identified on pages 47 and 48 that could adversely
impact the performance of the Group. Notwithstanding the
potential medium-term impact of COVID-19, the dividend policy
remains unchanged.

The majority of the cash resources are held by the principal
operating subsidiary Brewin Dolphin Limited. Further details of the
Group’s cash flow can be found below. Details of the Group’s
continuing viability and going concern are both on page 49.

Capital resources and regulatory capital

The Group’s financial position remains very strong with net assets
of £335.0m at 30 September 2020 (2019: £337.7m).

At 30 September 2020, the Group had regulatory capital
resources of £161.1m (2019: £215.9m). Investment in intangible
assets was the main driver of the reduction, see note 10 to the
Financial Statements. The Group’s primary regulator is the
Financial Conduct Authority (‘FCA’). The FCA’s rules determine
the calculation of the Group’s regulatory capital resources and
regulatory capital requirements. As required under FCA rules,
we perform an Internal Capital Adequacy Assessment Process
(‘ICAAP’), at least annually, which includes performing a range
of stress tests to determine the appropriate level of regulatory
capital that the Group needs to hold.

The Group’s Pillar III disclosures are published annually on our
website and provide further details about regulatory capital
resources and requirements.

Capital allocation

The Board is introducing a return on equity (ROE) as a measure
and guide to ensure that we are disciplined in our investments
and to ensure that we achieve appropriate returns. ROE will be
measured across the portfolio of investments and will be a guide
to ensure that we deliver sustainable returns. It will be measured
on an annual basis to ensure that we continue to provide returns
on the capital invested. ROE is defined as adjusted profit after tax
expressed as a percentage of average equity across the year.

Assessment of ROE will be a key consideration for all material
investment decisions, particularly for those related to acquisitions.

Cash flow

The Group had a cash outflow of £48.7m (2019: £43.0m inflow)
and total net cash balances of £180.5m as at 30 September
2020 (2019: £229.2m).

Adjusted EBITDA (see table below) was £99.5m (2019: £85.1m).
The acquisition of BDCIIL saw a cash outflow of £32m. Capital
expenditure of £28.9m was significantly higher than last year
(2019: £15.3m), supporting the ongoing infrastructure and
systems update. The contribution to the defined benefit pension
scheme of £1.3m (2019: £2.0m) was lower than last year
reflecting the new contribution rate.

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Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationEnvironmental, Social and Governance (ESG)

Driving a sustainable agenda

Being a responsible business is firmly embedded within our organisation.
We always seek to have a positive impact on society, our people,
clients and the environment.

Sustainability at Brewin Dolphin

We have initiated a Group-wide review, sponsored by our
Board and managed by our Executive Committee, of how the
Group addresses and responds to sustainability; both how we
behave as a responsible business and how we provide our clients
with responsible investment offerings. This year has seen the
creation of the Sustainability Committee, the Sustainability team,
and an ESG Investment Forum. All our initiatives and ambitions
are about supporting and safeguarding our stakeholders’
interests, whilst ensuring we build a strong corporate foundation
for a sustainable future.

Our approach identifies three pillars of sustainability
at Brewin Dolphin.

Pillar 1: Responsible investment

We have made a significant amount of progress this year on
our approach to responsible investment. For us, responsible
investment means integrating an assessment of ESG risks and
opportunities into our decision-making process, and actively
engaging with companies on material issues. As a signatory to
the UN Principles of Responsible Investment, we have committed
to consider ESG factors in our investment analysis and portfolio
management approach. We also commit to be active owners
and incorporate ESG issues into our stewardship policies
and practices.

Investing responsibly is a central part of how we operate,
and this year we have continued to formalise our responsible
investment approach. We have created a Sustainability team,
and a Sustainability Committee which reports directly to the
Executive Committee. To provide information to the Sustainability
Committee, we have set up an ESG Investment Forum and an
ESG Investment Network, consisting of members from all
business areas.

The first step in this journey has been an information gathering
exercise, understanding how our investment managers currently
fulfil their clients’ requirements, and what they need in the future.
To support the integration of ESG considerations into investment
decisions, we have engaged Sustainalytics, a leading data and
ratings firm dedicated to responsible investment and ESG
research. Our next step is to further develop our client offering
and build the tools needed to deliver the offering in a genuine and
robust way. This will include tools to capture client requirements,
to develop and monitor portfolios, and to create ESG reports
for clients.

#1 Responsible
investment

Ensuring that we can
offer our clients the right
responsible investment
choices for them

#2 Stewardship

Ensuring responsible
ownership of assets,
with monitoring
and engagement
where appropriate

#3 Responsible business

Ensuring Brewin is a company that seeks to have
a positive impact on society, including our people,
communities, clients and the environment

Pillar 2: Stewardship

As a steward of our client assets, we aim to engage with
companies and other organisations of influence to create
long-term value, leading to sustainable benefits for the
economy, the environment, and society.

We engage with our core holdings through purposeful dialogue
on high priority ESG issues as well as on issues that are the
immediate subject of votes at general meetings. Our Stewardship
Committee has the broader aim of ensuring that our clients’
interests as holders of securities are protected and, where
appropriate, ensuring proactive shareholder action is taken in the
best interest of those clients. Our Stewardship Policy can be
found on our website, and will be updated to reflect the new
Stewardship Code 2020. As well as engaging directly with
companies, we also leverage our influence by partnering with
other aligned investors on specific issues. We are a member
of the Investor Forum, a community interest company which aims
to bring together investors to escalate material issues with the
boards of UK-listed companies. This year, we further expanded
our collaborative engagement efforts by partnering with two
organisations. We joined Climate Action 100+, an investor
initiative to ensure the world’s largest corporate greenhouse gas
emitters take necessary action on climate change. We believe
that collaborative engagement is one of the most powerful tools
at our disposal, and driven by this, in September we appointed
BMO as an engagement partner. This partnership will allow us to
increase our influence, by collaborating with aligned investors to
engage our investee companies on priority ESG issues. Details of
our engagements and voting activity will be published in our 2020
Stewardship report.

Brewin Dolphin

Annual Report and Accounts 2020

Pillar 3: Responsible business

For Brewin Dolphin, being a responsible business means
identifying and actively managing the Environmental, Social and
Governance (ESG) risks and opportunities we face as an
organisation. We interact with many stakeholders, and through
these interactions we aim to have a positive impact on society.
This section summarises how we manage ESG risks and
opportunities within our organisation. We are always looking
at ways to evolve and improve our initiatives and ambitions.

To ensure our ESG ratings with third party rating agencies are
relevant, we actively engage with several agencies. MSCI
currently have our ESG Rating at AA. Our ESG Reference Guide
can be found on our Investor Relations website.

Environment

Green house gas emissions (‘GHG’)

As a business, we continue to assess our impact on the
environment and try to mitigate or reduce where possible.
Our main environmental impact is energy-related emissions from
our network of offices in UK and Ireland and from our employee
travel. Whilst COVID-19 has reduced our employee travel in the
second half of the year, it has made our data collection more
challenging. Our Corporate Responsibility Committee and
operations teams continue to make improvements in this space
across our offices, such as installing LED lights, power and
water-saving devices and recycling bins. We are also continuing
with digital initiatives to reduce the amount of paper we use
across our offices. For more information about our GHG
emissions please refer to pages 101 to 102.

Brewin Dolphin understands the importance of reporting on our
response to climate change. We intend to fully comply with the
TCFD disclosure requirements next year and as a first step we
made a CDP disclosure in August this year. Furthermore, we will
be answering the TCFD related questions within our first UN PRI
report in 2021. Our new Sustainability team has been tasked with
designing and implementing Brewin Dolphin’s approach as a
responsible business, a crucial part of which is the environment.

Social

Clients

The impact of the pandemic environment on our clients,
staff and suppliers has been significant and consequently
it has never been more important that we consider the needs
of vulnerable stakeholders on a consistent basis across the
business. We recognise that vulnerabilities can be far broader
and more transient than the definitions some firms have
traditionally used; and that we should be aware of potential
vulnerability as well as actual instances. Our Vulnerable Client
Committee is drawn from across the business and focuses our
thinking in terms of how we recognise and identify vulnerability,
the ongoing education and development of our people’s
understanding of vulnerability, and the creation of policies in
response, while through the work of its subcommittee the
Vulnerable Clients Forum, it is able to provide individual case
specific advice and expertise.

Human capital

It is a key part of our long-term strategy for growth that we
maintain our inclusive culture in which all of our staff are highly
valued, respected and engaged. We believe this is an essential
foundation upon which the Group can continue to meet individual
client needs. This is also a key motivator, differentiator and a
strategic advantage for us in the financial services market place.
Our people do business in a way that is both ethically sound and
reflects our corporate values. We believe that achieving this
makes ‘doing the right thing’ an automatic element of how we
treat each other, our stakeholders and the communities in which
we operate.

It is important that we are recognised, internally and externally,
for respecting our people, listening to them and enabling them
to meet their personal and collective goals. Having such
a reputation is a key aspect in attracting and retaining the best
talent. We achieve this through many ongoing initiatives and
forums including the Diversity and Inclusion Committee,
the Women@Brewin network, our network of Engagement
Partners, by encouraging staff to use a Volunteer Day allowance,
by facilitating tax-efficient charitable giving, matching staff
fundraising, offering community grants and pledging to support
societal change (such as by signing the 30% Club and the Race
at Work Charter).

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationEnvironmental, Social and Governance continued

Caring for the wellbeing of our people is more important than
ever and this year has seen us launch initiatives covering physical,
mental and financial health to complement the wellbeing
champion and mental health first aider network we have
established across our office network. We have also
introduced training for line managers on managing mental
health in their teams.

For further information on how we as a business responded
to COVID-19 and supported our employees, engagement,
diversity and inclusion, learning and development and succession
planning please refer to pages 38 to 39 and 70 and 71.

Health and safety

We are committed to providing a safe environment for our
workforce and visitors. We have arrangements in place to ensure
that we meet ongoing health and safety obligations to our staff
and other stakeholders, such as visitors to our premises.

Our Board is ultimately responsible for the overarching Health and
Safety policies and procedures of the firm and we confirm that we
comply with the Health and Safety at Work Act 1974 and all
associated regulations and codes.

We believe that sufficient and effective measures have been
implemented throughout the Group to prevent and mitigate
accidents and cases of work related illness, through the use
of training, risk assessments and awareness raising via our
framework of policies and procedures.

Our premises and facilities team have led the design, set up and
control of our COVID-19 secure offices. With a focus on social
distancing and hygiene, offices have been provided with
additional signage, enhanced levels of cleaning, clear incident
protocols and new processes to ensure that colleagues,
clients, and other visitors remain safe at all times.

Communities

Our corporate responsibility programme continues to have high
levels of engagement and giving by staff right across the
business. One of the principles of our programme is to create
close relationships between our people and the communities
where we live and work, above and beyond the simple act of
giving money. Our business understands the value of people
interacting with others, and that is a principle we have applied
to the communities and charities we support. This means sharing
our time and our expertise. We do support fundraising as well,
but it is a principle of our programme that we want Brewin
Dolphin and its employees to be at the heart of our communities.
We are an active contributor to society – helping to inspire futures
and positively impact those around us. We believe that long-term
partnerships are more beneficial for our partners than sporadic
or one-off giving, and as such have central and office partnership
programmes in place. For more information please refer to
pages 40 and 41.

Governance

Human rights, anti-corruption and bribery and the
management of our supply chain

We are committed to ensuring that the behaviours and practices
of our organisation, including those within our supply chains,
reflect our own high business standards and compliance with
applicable laws and standards. To bring to life our commitment
to good governance and compliance, we have set out below an
example of how we apply our standards of good governance
to our vendor relationships. We have a zero-tolerance approach
to slavery and human trafficking and bribery and corruption within
our workforce, and set the same robust expectations in relation
to our supply chain and vendors.

As a provider of financial services, we do not have a very long
or complex supply chain – our main vendors are either providers
of office supplies and support services such as reprographics,
IT, recruitment, and facilities management or professional advisers
such as legal, accountancy and advisory firms. Whilst we
consider our vendors to be at relatively low risk of engaging in
practices of modern slavery and human trafficking and/or bribery
and corruption, we nevertheless remain committed to preventing
the occurrence of such practices both in our business and our
supply chain.

To manage and mitigate the risks associated with potential
human rights breaches and bribery and corruption and to ensure
we have transparency around such issues we have a robust
vendor management framework. At a high level, appropriate
governance and oversight is maintained through a properly
constituted vendor governance committee with the overall
objective of ensuring good governance, oversight and monitoring
of our supply chain and vendor relationships. At a more granular
level, we ensure that a rigorous vetting process and due diligence
is undertaken before a vendor is engaged and appropriate
monitoring and oversight occurs throughout the relationship.

Underpinning this framework are the robust policies and
procedures, together with appropriate training, which gives our
workforce and other business partners guidance on breaches
of human rights standards (such as human trafficking) and
anti-bribery and corruption and the measures we take to tackle
such issues within our organisation and supply chain. We are
confident that the policies and procedures that we have in relation
to anti-slavery and human trafficking are in compliance with the
Modern Slavery Act 2015 and our public statement, to this effect,
is available on the Brewin Dolphin website (www.brewin.co.uk).
Further, our internal policies in relation to anti-bribery and
corruption are published and available for our workforce and
refreshed annually.

Brewin Dolphin

Annual Report and Accounts 2020

Whilst we believe we have a robust framework in place and
a commitment to doing the right thing, where these high
standards have not been met we encourage our workforce
to speak up and come forward. Through our Speak Up Policy
(formerly Whistleblowing Policy) and our ‘Speak up Champion’,
a role which is held by Ian Dewar, our Senior Independent
Director, we believe we are creating a culture of openness
and accountability.

Our tax strategy and transparency

Our tax strategy, as published on our website, outlines our
approach to tax risk and planning and sets out our commitment
to our investors, clients and tax authorities that we do not
participate in aggressive tax planning, seek to structure
transactions in an artificial manner, or condone abusive tax
practices which would contravene our ethics and culture.
Our management of tax is aligned to our core values. We always
act with integrity and transparency in our relationship with
HM Revenue & Customs (‘HMRC’) and all other tax authorities.
Our expert tax team has many years of professional experience
and we partner with reputable external advisers to support this
expertise and to deliver clarity of tax advice to the business and
senior management, ensuring that all tax risks are identified at the
earliest opportunity and managed within our Group-wide risk
management and governance framework, aligned always to the
Group’s low risk appetite. We understand and welcome our
obligations and social responsibility to pay the right amount of tax
in all the territories in which we operate and to comply not just
with the letter of the law but also the intentions of Government.
We actively engage with HMRC directly and indirectly through
our representative trade bodies to help deliver a fair and effective
tax outcome for our clients and the Group.

Risk management

We have a defined risk appetite which enables us to effectively
manage the potential upside and downside risks of our strategy.
A number of our principal risks correspond to our growth
strategy, which include our continued development of new
propositions and services to meet a broader range of client
needs, and where we have undertaken acquisitions resulting
in inorganic growth. We also have a Change Management
Programme, which is focused on enhancing our technology
infrastructure to support future growth.

The primary objectives of risk management at Brewin Dolphin are
to ensure that there is:

1. a strong risk culture so that employees are able to identify,

assess, manage and report against the risks the business is
faced with;

2. a defined risk appetite within which risks are managed;
3. a swift and effective response to incidents in order to minimise

impact; and

4. an appropriate balance between risk and the cost of control.

For more information on our risk management refer to page 44.

Cyber and data security

We have a comprehensive security programme across the Group,
which ensures a co-ordinated delivery of security services.
The cyber security framework is aligned with the international
standards of NIST and ISO27001. We utilise the three lines of
defence governance framework, the IT security team and IT
governance team form the first line with the Information Security,
Data Privacy Office and the Operational Resilience teams in the
second line.

The Group works constantly to identify the threats to its clients
and staff, mitigating them using technology, highly skilled teams
and a comprehensive awareness programme for both staff
and clients.

Our cyber security framework is about identifying, protecting,
detecting, responding and recovering, all within a critical
timeframe. The security teams strive to make the Group resilient
so as to ensure a consistent service to its clients. These risks
could be in the form of a cyber-attack, insider threat, delivery of
technology change, a service interruption or a third party supplier.

The Group regularly tests its crisis management teams using
internal and external training to ensure all plans and people are
prepared in the event of a serious incident. We are constantly
reviewing our cyber risks and adapting our controls accordingly.

Diversity policy and approach

The Board believes providing an inclusive and supportive
environment allows the Group to benefit from the variety of
experience, backgrounds and viewpoints that a diverse workforce
can bring. For more detail of the Group’s initiatives in relation to
diversity, see page 38. The Group has a Diversity and Inclusion
Committee with four distinct objectives; further details can be
found on page 163 of the Corporate Governance report.

Executive pay

The Remuneration Committee exercises independent judgement
on remuneration policies and practices, and the incentives
created to manage risk, capital and liquidity. It also oversees
personal objectives, performance appraisal and individual
compensation packages for the Chairman and Executive
Directors. The Committee consults with major shareholders
and proxy voting agencies before they update the Directors’
Remuneration Policy. They also perform an external benchmark
analysis against sector peers. When setting targets for annual
bonuses and LTIPs, they set suitably stretching targets to
appropriately motivate our Executives. For more information
read the Directors’ Remuneration Report on pages 79 to 99.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationOur People and Culture

Our culture at its best

We are actively working to build an inclusive workplace,
nurturing our culture through attracting, retaining and developing
a highly skilled workforce.

For several years we have focused on nurturing our culture, and
our belief in doing the right thing. And while we have talked about
the importance of our values, it is only when you are really tested
that you find out how genuine and deep-rooted they really are.
This year, as a result of COVID-19, we have had a powerful
demonstration of the value of our culture, thanks to the manner
in which our people have sustained our business.

COVID-19

The extraordinary circumstances of the crisis caused by
COVID-19 created challenges for the Group, but also provided
an opportunity to show us at our best.

From the outset we used our values to guide our decision-
making, and were committed to supporting our colleagues as well
as our clients. The clarity we have around the importance of our
culture and values meant that this was a straightforward way to
manage the situation, even if individual decisions were
complicated. We were able to swiftly adapt to working remotely,
while being sensitive to those colleagues who found the new
arrangements challenging.

We did not furlough anybody, choosing instead to redeploy those
whose activities were limited by the lack of face-to-face
engagement, and we made no redundancies. We also honoured
all offers of employment.

We introduced a number of support interventions, including
providing enhanced flexibility to enable people to care for
dependents, and to look after school-age children. We provided
a range of wellbeing materials to colleagues, and coached
managers on how to adapt to working with their teams remotely.
We also offered an interest free loan for employees facing financial
hardship as a result of COVID-19, which was in their bank
accounts the day after they applied.

Engagement

We remain firm believers in the idea that if you treat your people
well, they will perform well.

Our response to the pandemic has reinforced that view and we
have seen the impact in our engagement scores from our annual
Your Future, Your Say colleague survey. Engagement scores rose
again, in this most demanding of years, to 90% – which is 13
points above the financial services benchmark. This is hugely
encouraging as we continue to make Brewin Dolphin a desirable
place to work. Our scores in the survey over the last six years
have shown consistently high engagement to be an area of
competitive advantage for us.

Every one of our teams nominates an ‘Engagement Partner’ who
works with local management on the things that matter to our
people on the ground.

Our values are at the heart
of our business

Genuine
Heartfelt advice
delivered
by people
who care

Expert
Skilfully facilitating
important
decisions

Our core
values

Ambitious
Making more of life’s
opportunities

Our annual People Awards are celebrated in January each year,
and they focus upon our values of Genuine, Expert and
Ambitious. Notably the winners are nominated by their colleagues,
rather than being picked centrally on the basis of sales
performance. It is a sincere mark of appreciation and reflects the
generous spirit of our culture.

Diversity and inclusion

We are committed to creating a workplace and culture that is
welcoming and inclusive for everyone. We value the contribution
of all our people and recognise that diverse backgrounds,
experiences and ideas enable us to grow and remain resilient.
Our Diversity and Inclusion Committee guides our work and
engages with colleagues across the business to develop initiatives
and set priorities.

This year has been marked by the Black Lives Matter movement,
prompting businesses around the world to reflect on their
ethnic diversity and understanding of colleagues’ experiences.
It has led us to accelerate and expand our planned activity,
including commissioning a series of workshops entitled
‘Let’s Talk About Race’ to enable colleagues to be part of these
important conversations.

Brewin Dolphin

Annual Report and Accounts 2020

We also announced an expansion of our partnership with the
Institute of Customer Service to further enhance the quality of
service that we provide to our clients, building on the experience
gained by colleagues in BPS. Within the business we have also
created a Service Excellence Forum to share ideas and embed
our focus on excellent client service.

We have continued to run our major learning and development
programmes, adapting them to remote learning approaches as
a result of the pandemic. These include our Aspire management
training and mentoring, our Financial Planning Academy, and our
Emerging Talent and Executive Leadership Programmes.
This summer we were delighted to celebrate the first cohort
from our Cranfield Executive MBA completing their course.

We continue to expand our online learning portal, Grow, providing
opportunities for everybody across the business to take control
of their own development. Our regulatory learning programmes
ensure that our people have an appropriate level of knowledge for
their role responsibilities. This included providing training around
the implementation of SMCR in December 2019.

Succession planning

Being clear on the skills we need as a business is of course an
important part of our succession planning work. This year we
have been able to appoint a new Chief Executive Officer and
a new Chief Operating Officer from within; a reflection both of the
quality of the people we have within the Group, and also of how
we develop our people so they become the outstanding
candidates for the roles we have available. From a culture and
continuity perspective this is most welcome, and an endorsement
of work identifying and developing talent to support the business.

In July we signed the Race At Work Charter, with Robin Beer
as our Executive Sponsor. This has five principles to ensure
organisations address barriers to recruitment and progression.
Our Executive Committee is now participating in reverse
mentoring with colleagues from ethnic minority backgrounds,
and we have run a series of focus groups across the business
to understand views and experiences. The outcome of these
sessions will be one of the factors informing our work over the
next year. In October we celebrated Black History Month with
a series of educational and engaging activities.

Our CEO and Chairman are proud members of the 30% Club,
with its goal of achieving beyond 30% women and increasing
ethnic diversity on boards and senior teams. We are also proud
of our position of sixth in the FTSE 250 in the most recent
Hampton-Alexander rankings for gender diversity. Our hiring is
now evenly split between men and women across the business,
and we continue to be a signatory and active supporter of the
Women in Finance Charter focused on improving gender diversity
at senior levels and developing future leadership talent. We are
founding partners of the WealthiHer network committed to
championing, empowering, and supporting female clients.

Our focus on LGBT+ inclusion is continuing to build an
environment in which people feel able to bring their whole selves
to work. We are members of myGwork, a business community
of LGBT+ professionals offering access to mentoring, networking,
workshops and events. This year, they have facilitated a series
of workshops to help us better understand language relating to
gender and sexual orientation and remove this as a barrier to our
conversations. These were followed by our celebration of Pride in
June which was more prominent than in previous years, both
externally and internally.

Learning and development

Our approach to our people has always been focused on
providing the business with the people and skills that it requires
to deliver its strategy.

Our relationships with our clients, and the experience we can offer
them, is central to that strategy. This year we launched our Future
Wealth Manager training programme – a 13-month programme
for client-facing teams to further enhance their technical and
behavioural skills and client expertise to guide them across
our propositions.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Social Responsibility (CSR)

Actively supporting
our communities

An important part of our culture has always been the role
that we play in the community.

We see ourselves as active citizens who make a contribution to
the communities in which we live and work, and our approach is
to support our people to make their own individual contributions,
rather than dictating one approach from the centre. We have also
sought to ensure our contribution is about more than money –
giving time and expertise as well.

We began the year by launching our support for social
entrepreneurs through our Inspiring Futures programme.
In addition, many of our offices chose individual charity partners
for the first time. Across the business our employees gave their
time and energy to volunteer and fundraise for local charities,
and support their communities.

During the COVID-19 crisis we had to be flexible in our approach
to our programmes and came up with new ideas to allow our
people to continue supporting their communities. They rose to the
challenge and we saw the same levels of enthusiasm, with virtual
volunteering and amazing team challenges. During the crisis,
volunteering was more important than ever and therefore as
a business we increased the number of volunteering days for
individuals from one to five per year.

Our giving:

Pre COVID-19 – six months to March 2020

• For the second year in a row we have been awarded

The Payroll Giving Platinum Award 2020. This is in recognition
of the fact that more than 20% of eligible employees are
enrolled in the scheme.

• Through our fundraising matching programme, we saw great
examples of support for charities in the lead up to Christmas,
such as bake sales, raffles and food collections, and physical
activities like the John Muir Way challenge undertaken by the
Edinburgh office.

• At the start of the year, as part of our small grants programme

we were pleased to donate funds to several small, local
charities nominated by colleagues who have a personal
commitment to them.

• Volunteering has always been an important part of the culture
of Brewin Dolphin, and each year, our colleagues from across
the Group give thousands of hours to local charities. The start
of this year was no different. Our Newcastle office held their
‘12 Days of Christmas’ initiative, which involved volunteering for
several local charities through the festive season. Other offices
helped at their local foodbanks to prepare food donations over
the Christmas period.

During COVID-19

As the nation went into lockdown, we saw how badly hit charities
were and how the loss of volunteers and funding opportunities
would impact their ability to help their beneficiaries. In response
we introduced the Brewin Dolphin Community Relief Fund and
committed to distributing £25,000 to 100 charities. These
employee-nominated charities were all based in our local

Newcastle office, Changing Lives’ Christmas party

communities and supported people during the pandemic.
The fund was distributed in a matter of weeks to food banks,
domestic abuse charities, homeless shelters and more.

With so many charity fundraising events cancelled, in the second
half of the year we saw more and more teams take on virtual
challenges. Across our office network, teams responded
admirably to the restrictions imposed on normal fundraising
activities. 27 teams ran, walked and cycled thousands of miles,
raising over £70,000 for their charity partners or other
local charities.

• Our team in Manchester took part in a Race Across Europe
challenge, as they ran, rowed and cycled over 5,000km.
90% of the team took part and they raised over £10,000 for
local charity The River Manchester.

• In Birmingham, the team covered 25,000 miles to complete
their Around the World in 80 Days challenge, raising £8,000
for their charity partner Help Harry Help Others, while our
Shrewsbury team walked, ran and canoed the length of the
River Severn, raising over £2,000 for Victim Support.

• Belfast and Dublin worked together to cover over 5,000km

in aid of AWARE NI and Sonas.

The crisis created a need for a growing number of volunteers.
Although we were unable to take part in our usual team
volunteering activities, we were heartened by the number of
people helping in their communities, becoming NHS responders,
delivering supplies and medicine, and supporting local foodbanks.
Employees also gave their time through virtual volunteering
opportunities with charity partners and students.

Brewin Dolphin

Annual Report and Accounts 2020

The Brokerage is a City of London-based social mobility charity
that connects young Londoners with employers. They help young
people achieve their career potential through work experience,
employability skills and jobs in financial, professional and
related services. Our Learning and Development teams have run
two virtual sessions with them on personal brand and CV and
interview skills. We also have colleagues from across the business
who have signed up to mentor Year 13 students from London
boroughs, helping them to develop professional skills and
increase their aspirations in the world of work.

Skills Builder have been one of our longest running partners.
They have grown from a start-up social enterprise to a thriving
business. Over the course of our five years partnering with Skills
Builder, we have hosted over 60 sessions across eight offices,
with over 1,500 students and more than 60 volunteers from
across Brewin. We were able to host groups of students in our
offices in London, Newcastle and Nottingham at the start of the
year. Once lockdown began and schools closed, we were able
to take part in a virtual session, where our volunteers spoke about
their jobs and careers, and answered the students’ questions
about working life and applying Skills Builder’s essential skills
at work.

Shrewsbury office, Shrewsbury Food Bank

Belfast office, Northern Ireland Children’s Hospice

As mentioned above, many of our offices have chosen individual
local charities to partner with and fundraise for. To support these
partnerships centrally, we provided some additional funding once
lockdown began.

We donated £22,500 to support the National Emergencies
Trust’s Coronavirus Appeal. Money raised through this appeal is
distributed to 47 UK Community Foundations. A further donation
of €3,000 was made to the Community Foundation for Ireland’s
Covid-19 Response Fund, which aims to help the immediate
needs of organisations impacted by the pandemic.

We are excited to have signed the C-19 Business Pledge,
which demonstrates our commitment to our employees,
clients, and community throughout the COVID-19 crisis and
beyond. Founded by former UK cabinet minister, Rt Hon Justine
Greening, and UK entrepreneur David Harrison, the aim of the
C-19 Business Pledge was to mobilise the immediate response
to the pandemic. Over 300 organisations globally have made the
pledge, representing over 2.5 million employees.

Our partnerships

This year we launched our partnership with the School
for Social Entrepreneurs (SSE). We are funding a six-month
course for 16 social entrepreneurs from across the UK who
are at the start of their journey of building their businesses.
Social enterprises are businesses with a clear social or
environmental mission, who aim to change the world for the
better. Like traditional companies, they aim to make a profit,
but social enterprises aim to reinvest profits or surpluses to
create positive social change. SSE moved all their modular
learning blocks online, allowing the course to continue as
planned during lockdown.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCarrie Heron
Edinburgh

Agility & Resilience:

Giving time to support
local causes

Brewin Dolphin gives all employees one day a year to volunteer for a charitable cause that
is important to them. This year, in the wake of the pandemic, we increased that to five
days and encouraged everyone in the business to make a difference to their
communities. Carrie Heron from our Edinburgh office volunteered for CCLASP.

Hands-on support

CCLASP stands for Children with Cancer and Leukaemia, Advice and Support for
Parents. It is a local charity based in Edinburgh, that provides support and advice for the
parents of children from across Scotland suffering with cancer and leukaemia.

I have volunteered for them previously, with my colleague Louise. We normally help out
at Christmas time, helping them to prepare for their festive events, such as parties,
putting together gift packages from Santa. After Covid hit though, there were other
packages to be put together.

Lots of children suffering from cancer and their families had to shield for up to 14 weeks
during lockdown. So Louise and I helped by putting together more practical food
packages – dry goods, tinned goods, fresh fruit and veg, toiletries – plus a goodie bag for
the children with crisps, sweets, colouring books and so on. We do volunteer every year,
but the pandemic has made already difficult situations even harder. It’s very humbling to
be able to make a small difference.

Brewin Dolphin

Annual Report and Accounts 2020

Gordie Houston
Birmingham

Agility & Resilience:

Bringing the team together
to raise money for charity

Brewin Dolphin encourages colleagues to raise funds for charities of their choice,
and supports them to do so. At the start of the pandemic, with many charities facing
significant reductions in income due to reduced opportunities for fundraising, the
business suggested a series of local fundraising challenges – either in teams or offices,
raising over £70,000 in total. Gordie Houston co-ordinated the Birmingham office effort.

Around the world

Earlier in 2020, we selected Midlands charity Help Harry Help Others as the Birmingham
office’s charitable partner for the year. We had planned to support them with a number
of charity activities including a golf day, but these had to be cancelled due to the
pandemic. So we had to think of another way to raise money for them.

I came up with the idea for Round the World in 80 Days, because it gave us
a good challenging target – 25,000 miles to be covered in 80 days. People were
able to walk, run, cycle or swim to help us cover the distance.

The response was fantastic. Out of 63 people in our office, 56 signed up and joined in.
We raised over £7,500 through friends and family, and it gave the whole office a real
sense of togetherness at a time when we were all getting used to working remotely.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationPrincipal Risks

Managing our risks

Effective risk management is key to the success of delivering our
strategic objectives. Our approach to risk management continues to
evolve as the risk landscape changes; it ensures timely identification,
assessment, and management of the principal risks to our business.

We have a defined risk appetite which enables us to effectively
manage the potential upside and downside risks of our strategy.

• Appropriate levels of conduct and considered risk

taking behaviour;

• Recognition of the importance of knowledge, skill and

experience in risk management;

• Members of staff at all levels to escalate events and make
suggestions for improving processes and controls; and

• An acceptance of the importance of continuous management

of risk, including clear accountability for and ownership
of specific risks.

The benefits of establishing a strong risk culture is evident,
with our employees self-identifying and escalating risk events and
potential issues to mitigate the probability of risks crystallising.

We follow industry practice for risk management through the
“three lines of defence” model. The first line is the business that
owns and manages the risk, the second consists of the control
functions that monitor and facilitate the implementation of
effective risk management practices, and the third line is
independent assurance provided by internal audit.

The Board reviews the effectiveness of this Risk Management
Framework and undertakes an assessment of the principal and
emerging risks, receiving reports on internal control from the
Audit and Risk Committees and debating key risks for the Group
following more detailed work by the Risk Committee.

The key parties involved in the risk management process within
the Group and their respective responsibilities and an explanation
of how risk management is structured within the Group, are set
out opposite.

Our principal risks relate to our resilience from an operational
and financial perspective, and our strategic focus including
change management required to build a platform for growth,
and innovation to deliver propositions that continue to meet the
needs of our clients.

The primary objectives of risk management at Brewin Dolphin
are to ensure that there is:

• A strong risk culture so that employees are able to identify,
assess, manage and report against the risks the business is
faced with;

• A swift and effective response to risk events and potential

issues in order to minimise impact;

• A defined risk appetite within which risks are managed; and
• An appropriate balance between risk and the cost of control.

Our approach is to maintain a strong control framework to
identify, monitor and manage the principal risks we face,
adequately quantify them and ensure we retain sufficient capital
in the business to support our strategy.

We assess our principal risks regularly to ensure that our risk
profile is within our risk appetite which is set by the Board.
Annual risk workshops attended by both the Risk Committee
and the Executive Committee are held.

Risk Management Framework

The Board has established a Risk Management Framework to
ensure there is effective risk governance. The Board promotes
a strong risk culture and expects every employee within the
Group to adhere to the high standards established by the Board.

The Board encourages a strong risk culture throughout the
business by promoting:

• A distinct and consistent tone from the top;
• Clear accountabilities for those managing risk;
• Prompt sharing and reporting of risk information;
• A commitment to ethical principles;

Brewin Dolphin

Annual Report and Accounts 2020

Risk management process

We categorise risks into risk groups covering potential impacts to clients, revenue, capital and reputation.
The three risk groups are:

Business
risks

Financial
risks

Operational
risks

Our risk management process involves the identification and assessment of specific risks within these risk groups, mitigation and
management of these risks, and monitoring and reporting against these risks, which provides the foundation to enable us to deliver
against our strategic objectives.

Risk Management Framework

Top down risk management

Board

• Responsible for ensuring there is
an adequate and appropriate risk
management framework and culture
in place.

• Sets risk appetite and is responsible

for ensuring alignment with the
Group’s business strategy.

• Approves the ICAAP.

Risk Committee

• Oversees the Risk

Management Framework.

• Assists the Board in its

responsibilities for the integrity
of internal control and risk
management systems.
• Recommends the ICAAP
to the Board for approval.

Audit Committee

• Assists the Board in gaining
assurance as to the integrity
of the Financial Statements and
the effectiveness of the system
of internal controls.

• Monitors the effectiveness

and objectivity of internal and
external auditors.

Risk Management Committee

• Executive level committee oversight
and monitoring of the adequacy and
effectiveness of the Risk
Management Framework.

• Monitors current and emerging risks

and themes.

• Oversees the Group’s

Policy Framework.

Business risks
These are the risks that we do not
set the right strategy, a material
business decision fails or external
market factors impact the viability
of the business.

Financial risks
These are the risks facing our
business in terms of inadequate or
failed management of finances and
the risk introduced by external
factors that could have a
detrimental impact on our cash
flow, capital and liquidity.

Operational risks
This is the risk of loss resulting
from inadequate or failed internal
processes, people and systems,
or from external events.

Bottom up risk management

Risk identification and
assessment

• Risk and Control Self Assessments
to identify the key risks for each
department, for business change
activities, and for new products
and services.

• A horizon scanning forum is in place
to identify and assess emerging
risks, and establish ownership
for mitigation and management
of those risks.

• Assessment of inherent (pre-control)

and residual risk (post-control).

Risk mitigation and management

• Management of events that have
a potential or actual financial,
regulatory, operational or
client impact.

• Agreeing action plans to mitigate

risk issues.

Risk monitoring and reporting

• The business community is primarily

responsible for monitoring risks.

• Risk trends are monitored

and analysed.

• Key risk indicators are

reviewed monthly.

Risk assurance

• Internal auditors evaluate the

adequacy of process and systems,
and test the operating effectiveness
of key controls.

• Control monitoring teams are
in place, undertaking both
regular control sampling and
thematic reviews.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationPrincipal Risks continued

Principal risks - gross risk assessment

Factors which reduce these risks are provided in the principal risks and uncertainties table. The risks are shown on an inherent
basis (before mitigating controls):

4 Regulatory &

legal compliance

5 Change management

8 Fraud

7 Resilience

6 Conduct

1 Propositions

3 Counterparty default

2 Acquisitions

y
t
i
l
i
b
a
b
o
r
P

Impact

Business risks

Financial risks

Operational risks

1: Propositions

2: Acquisitions

3: Counterparty default

4: Regulatory & legal compliance

5: Change management

6: Conduct

7: Resilience

8: Fraud

Responding to risks

• Resilience has been crucial during 2020, and our crisis

management teams have been in full operation in response
to COVID-19. We have provided continuity of service to our
clients, and evidenced our capability to effectively respond to
a crisis from a people, processes and systems perspective,
in addition to our financial resilience.

• We held an in depth risk workshop with our Risk Committee
and Executive Committee members, focusing on business
risks, e.g. the risk of losing key staff and clients, and focusing
on emerging trends within the financial sector and broader
societal themes, e.g. sustainability.

• Financial market uncertainty has significantly increased.

We regularly stress test our funds, profit, cash, and regulatory
capital to understand and plan for situations which could result
in the need to amend our business strategy.

• Change management governance and oversight has been

a significant focus during the period as we have completed the
implementation of a new client management system, and are
progressing with the implementation of a new custody and
settlement system.

• We have successfully implemented a Governance, Risk and
Compliance tool in 2020, aggregating risk-related data into
a single application, providing enhanced analytical capabilities
to identify risk trends, and workflow capabilities to enhance the
efficiency of how we manage risk.

• The pipeline of regulatory change remains a focus, including
our preparations for a new prudential regime for investment
firms, due to be implemented in summer 2021. In addition,
we continue to be focused on Brexit and have a Brexit Steering
Committee in place to co-ordinate the Group’s preparation
for EU withdrawal.

The Directors confirm that we have carried out a robust
assessment of the emerging and principal risks facing the
Company, including those that would threaten its business
model, future performance, solvency or liquidity.

Brewin Dolphin

Annual Report and Accounts 2020

Principal risks and uncertainties

The tables below detail the principal risks and uncertainties we have identified, it is not an exhaustive list of all of the risks the Group
faces. We have a process to regularly report key risk indicators and identify changes in the profile of these principal risks. We also
consider emerging risks as part of this process.

Key to our strategic outcomes

RG Revenue growth

Improved efficiency

CS Capital efficiency and shareholder return

Read more on page 22 for ‘Our Strategy’ and page 24 for KPIs for further information in relation to the primary strategic impact.

Business risks
These are the risks that we do not set the right strategy, a material business decision fails, or external market factors impact the businesses
viability. This could include an inability to introduce or enter into new business lines effectively, to expand organically or through merger/
acquisition, or to enhance the effectiveness of our operational infrastructure. In addition to the principal risk specified, we monitor the
external environment and model the potential impact of different potential geopolitical scenarios as part of our stress testing programme.

Principal risk
and risk
owner(s)

Propositions
Risk owners:
Managing
Director of
Advice and
Innovation,
and Managing
Director of
Wealth and
Investment

Acquisitions
Risk owner:
Acquisition
Executive
Sponsor

Primary
strategic
impact

Nature and potential
impact of the risk

The risk of propositions
being uncompetitive
and not meeting the
needs of our clients,
resulting in a failure to
attract new clients or
existing clients leaving,
e.g. risk of not meeting
increasing demand for
sustainability focused
investment solutions.

Mitigating factors

• Dedicated resources to develop, test and

launch new service offerings.

• New service offerings are piloted before

broader rollout.

• Two key hires recruited into the sustainability

team, driving the Group’s sustainability
strategy and responsible investment
propositions, considering environmental,
social and governance factors, including
climate change.

Examples of
risk metrics
monitored

• Number of
new clients,
client pipeline,
net flows,
funds under
management.

Movement
in the year

Client needs
are changing and
there is increasing
demand for
different
investment
solutions.

The risk of acquisitions
not achieving strategic
objectives or resulting
in unidentified liabilities
post completion.

• Acquisitions form part of the Change

Management Programme governance.
• Post completion metrics are monitored.

• Income,

client and staff
retention, client
complaints.

We have
significantly
progressed
integration
activity for the
acquisitions
completed in
the prior period.

Financial risks
These are the risks facing our business in terms of inadequate or failed management of finances and the risk introduced by external factors
that could have a detrimental impact to our cash flow, capital and liquidity.

Principal risk
and risk
owner(s)

Nature and potential
impact of the risk

Primary
strategic
impact

Mitigating factors

Examples of
risk metrics
monitored

Movement
in the year

Counterparty
Risk owner: Chief
Financial Officer

Default by our banking
counterparties could
put our own or our
client cash deposits
or assets at risk of loss.

• A Financial Risk Management Framework is in
place which includes managing the Group’s
exposure to counterparty credit risk; setting
and monitoring counterparty limits.

• Proportion

of money held
per banking
counterparty.

• Diversity across our banking counterparties.
• Due diligence is undertaken for all banking

counterparties.

• A Financial Risk Committee provides oversight
of the Financial Risk Management Framework.

• Banking

counterparty
ratings.

• Changes in the
risk profile
of banking
counterparties.
• Credit Default
Swap spreads.

The risk externally
has increased due
to the challenging
economic
environment.
However,
in response we
have increased
diversification of
money held per
banking
counterparty.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationPrincipal Risks continued

Operational risks
This is the risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events.

Principal risk
and risk
owner(s)

Regulatory &
Legal
Compliance
(Risk owner:
Chief Risk
Officer)

Primary
strategic
impact

Nature and potential
impact of the risk

This is the risk that we
are not compliant with
all existing applicable
regulation and
legislation, which could
lead to regulatory
enforcement action.

Mitigating factors

Examples of
risk metrics
monitored

Movement
in the year

• Compliance and Legal functions monitor and

• We have

oversee fulfilment of our regulatory and
legislative requirements and interactions with
our key regulators.

• We execute against a robust compliance

monitoring plan, and have strong governance
in place to identify issues and ensure any
required actions are completed.

Change
Management
(Risk owners:
Chief Risk Officer
and Chief
Operating Officer)

The risk that business
and regulatory changes
are not delivered. This
could restrict the firm’s
ability to achieve its
strategic objectives
of revenue growth and
operational efficiency.

• A Business Change Board with Executive

Committee representatives oversee
and challenge the change management
programme.

• Change management is centralised within

a Change and Transformation team.

This is the risk of not
delivering fair outcomes
for clients.

Conduct
(Risk owner:
Group Head
of Investment
Governance)

Resilience
(Risk owners:
Chief Risk Officer
and Chief
Operating Officer)

This is the risk that the
Group does not have
the ability to respond
to, recover and learn
from operational
disruption to core
business activities.

Fraud
(Risk owner:
Chief Risk
Officer)

The risk of
unauthorised gain or
transfer of company or
client assets, and the
risk of unauthorised
access to or corruption
of information.

• Tone from the top sets a culture which puts

delivering fair outcomes for clients at the core
of the Group’s activities/ethos.

• A conduct risk framework sets our approach
to conduct risk governance and the ongoing
assessment, monitoring against key metrics
and reporting of conduct risk.

• A conduct risk dashboard is in place, enabling
detailed monitoring and oversight of conduct
risk at an individual employee level.

• A risk based client on-boarding process which
ensures that we understand our clients’ needs
and attitudes to risk.

• A quality assurance process to identify and
address any instances where the best
outcomes for clients are not achieved.

• Robust investment governance supported by
an Investment Governance Committee and
a dedicated research department.

• A dedicated Information Security, Data

Protection and Operational Resilience team
reports directly to the Chief Risk Officer.

• Crisis management scenarios are undertaken
with external providers to test the roles and
responsibilities of the crisis management
response teams.

• We engage independent parties to act

undercover and simulate attacks.

• We have a third party security specialist in
place to ensure the resilience capabilities
of our third parties.

• All expense payments are requested,

approved and administered using a spend
management platform with in built controls.
• Robust controls are in place for the requested

change of payee bank account details.
• Threat scanning for potential cyber risks.
• Simulated phishing programme in place to
ensure familiarisation with phishing attacks.

dashboards in
place to
monitor each
regulatory risk
which includes
assessment of
the control
environment,
regulatory
interaction,
issues and
breaches.

• Project status
taking into
account risks,
issues, budget,
resources,
internal and
vendor
deliverables.

• Client service

reviews.
• Quality

of advice.

• Asset

allocation.

• Portfolio
turnover.

• Client

complaints.

We have
completed actions
for the key potential
issues identified as
a result of our
governance
processes.
However, the
regulatory and legal
environment will be
impacted by Brexit.

Although we have
successfully
completed the
implementation
of a replacement
client management
system in the
period, material
reduction in
Change
Management risk
will be achieved
following
replacement of the
custody and
settlement system.

Increased market
volatility has
led to increased
trading and
changing client
requirements.

• Technology

resilience and
potential
vulnerabilities.

• Key person

dependencies.

• Service

disruptions.

The external
threat of
operational
disruption
increases.
We continue
to mature
our approach
to mitigating
this risk.

• Fraud

attempts.

• Internal
process
monitoring
results.
• Security
threats.

• Phishing testing

results.

Heightened
external risk,
particularly related
to cyber, as
fraudsters take
advantage of the
COVID-19
pandemic.

Brewin Dolphin

Annual Report and Accounts 2020

Going concern

The Group’s business activities, performance and position,
together with the factors likely to affect its future development are
set out in the Chairman’s Statement, the Strategic Report and the
report of the Risk Committee.

The Group’s objectives, policies and processes for managing its
capital; its financial risk management objectives; details of its
financial instruments and its exposure to credit risk and liquidity
risk are described in note 30 to the Financial Statements.

The Directors believe that the Group is well placed to manage its
business risks successfully. The Directors assess the outlook of
the Group by considering its Medium-Term Plan (‘MTP’) as well
as the results of a range of stress tests. The MTP takes into
account both the COVID-19 pandemic and Brexit and the
resultant economic uncertainty and volatility. The stress tests,
including a reverse stress, enable the modelling of the impact
of a variety of external and internal events on the MTP; identify
the potential impact of stress events on the Group’s income,
costs, cash flow and capital; and enable the Directors to assess
management’s ability to implement effective management actions
that may be taken to mitigate the impact of the stress events (see
note 3bii to the Financial Statements for detail).

These tests demonstrated that the Group has adequate
resources, including cash, to continue in operational existence
for the foreseeable future. Accordingly, the Directors continue
to adopt the going concern basis for the preparation of the
Financial Statements.

In forming their view, the Directors have considered the Group’s
prospects for a period exceeding 12 months from the date on
which the Financial Statements are approved.

Viability statement

The Directors have assessed the outlook of the Group over
a longer period than the 12 months required by the going
concern statement in accordance with the UK Corporate
Governance Code.

The assessment is based on the Group’s Medium-Term Plan
(‘MTP’), the Internal Capital Adequacy Assessment Process
(‘ICAAP’) and the evaluation of the Group’s principal risks
and uncertainties (see pages 47 and 48), including those risks
that could threaten its business model, future performance
or solvency.

The Group maintains a five-year MTP as part of its corporate
planning process, which is a financial articulation of the Group’s
strategy. The financial forecasting model is predicated on a
detailed year-one budget and higher level forecasts for years
two to five. As part of preparing the MTP, the Board takes into
consideration the impact of external factors and this year in
particular the impact of the COVID-19 pandemic and the resulting
economic uncertainty, in the projections.

As a matter of good practice and as part of the ICAAP required
by the Financial Conduct Authority (‘FCA’), the Group performs
a range of stress tests including reverse stress tests. These
assess the Group’s ability to withstand a market-wide stress,
a Group-specific (idiosyncratic) stress and a combined stress
taking into account both market-wide and Group-specific events.
The stress tests are derived through discussions with senior
management, and are deemed to be severe but plausible,
after considering the principal risks and uncertainties faced by
the Group. The scenarios involved are refreshed on an at least
annual basis or sooner if a trigger event occurs to ensure they
remain current.

The stress tests enable the Group to model the impact
of a variety of external and internal events on the MTP; to identify
the potential impact of stress events on the Group’s income,
costs, cash flow and capital; and the Board to assess the
effectiveness of any management actions that may be taken
to mitigate the impact of the stress events.

The reverse stress tests allow the Board to assess scenarios and
circumstances that would render its business model unviable.

This enables the identification of potential business vulnerabilities
and the development of potentially mitigating actions.

As an example, for this year, one of the Group stresses under the
market-wide scenario is based around the impact of the
prolonged inflation experienced in the 1970’s which saw global
equities fall approximately 40%. Subsequent management actions
include, inter alia, a significant decrease of dividend payments
over the period and variable remuneration reduced to as minimum
as possible. Following these actions, the resultant outcome
ensures the Group still maintains sufficient net assets and
regulatory resources to operate as a going concern.

In addition, the Group has prepared for the UK leaving the
European Union without a withdrawal agreement. Both these
analyses do not present any reason to believe the Group will not
remain viable over the longer term.

Following the assessment of the above, the Board concluded that
the Viability Statement should cover a period of five years. While
the Directors have no reason to believe that the Group will not be
viable over a longer period, this period has been chosen to be
consistent with the MTP used as part of the Group’s corporate
planning process.

Taking account of the Group’s current position and principal risks
and the Board’s assessment of the Group’s prospects, the
Directors have a reasonable expectation that the Group will be
able to continue in operation and meet its liabilities as they fall due
over a period of at least five years.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationNon-Financial Information Statement

The following section provides the key areas of disclosure in this Annual Report required by sections 414CA and 414CB of the
Companies Act relating to non-financial reporting and references to where further information can be found. All policies have an
accountable person who attests that the policy is fit for purpose prior to it being reviewed and approved by the relevant committee
on an annual basis, the relevant committee for each policy is set out in the table below.

Policy

Policy objective

Outcomes/impact/action taken

Employees
The Group values its people and their wellbeing. It is strongly committed to the engagement, development and recognition of its employees and
is mindful of the impact of culture. Further details on HR policies and employee related outcomes can be found on pages 38 - 39 and 62 - 63.

Employee handbooks

Approved by the
Executive Committee

Health and Safety Policy

Approved by the
Risk Management Committee

Senior Managers Individual
Accountability Policy

Approved by the
Executive Committee

Training and Competence
Scheme

Approved by the
Executive Committee

The handbooks outline values, culture, benefits etc. They are
designed to improve engagement among staff and are an
important element of the recruitment process.

Employees are updated on general policies,
guidelines and benefits and understand what
action to take if problems occur in order that
issues are dealt with fairly and consistently.

The policy ensures that the Group complies with legislation to
protect its employees and clients and provides a suitable and safe
environment for clients, employees and anyone affected by the
Group’s operations.

Annual risk assessments are completed and
actions identified to improve the health and
safety of employees.

For further information see page 36.

The policy ensures that the Group’s regulatory obligations
in respect of Senior Manager’s training and competence
requirements and the assessment of their ongoing fitness and
propriety are met.

The scheme ensures that the Group meets its regulatory
obligations in respect of training and competence and that clients
receive suitable advice, fair outcomes and high standards of
service by helping to ensure that employees are fit and proper.

Senior Managers have access to training and
are encouraged to develop their knowledge.

Bi-annually a report is submitted to the Risk
Management Committee identifying
exceptions, issues and breaches
accompanied by recommendations.

Competency is maintained through training
and ongoing supervision.

Environment
The Group does not have a specific policy in relation to environmental matters. As set out in the Environmental, Social and Governance (‘ESG’) section
on page 34, our impact on the environment is largely through UK-based travel and the consumption of resources and emissions at the buildings in our
branch network. Further details of initiatives are set out in the ESG section. The Group’s Greenhouse Gas Emissions report can be found on page 101.

Social Matters
The Group does not have a specific policy in relation to social matters. However, as detailed in the Corporate Social Responsibility (‘CSR’) section, see
pages 40 to 41, we strive to make meaningful contributions to the local communities in which we operate.

Vulnerable Clients Policy

The policy defines vulnerable clients and the Group’s approach
to supporting them, managing them sensitively and taking into
account their specific needs.

Systems are in place which allow Certified
Persons to record when a client is vulnerable
and to ensure the client has all the support to
ensure they understand information provided
and implications of decisions they make.

Training on the policy takes place on
a periodic basis.

Approved by the
Investment Governance Committee

Data Protection Policy

Approved by the
Risk Management Committee

Achieving Fair Outcomes
for Clients Policy

Approved by the
Investment Governance Committee

Vendor Management and
Outsourcing Policy

Complaints Policy

Approved by the
Investment Governance Committee

The policy sets out the responsibility of the Group, Board,
Executive Committee, staff, contractors and consultants to
comply fully with GDPR and the UK Data Protection Act 2018.

Data security and awareness training
is provided to Group personnel on an
annual basis.

The policy sets out the requirements to ensure the Group
delivers fair outcomes for its clients, underpinning the way
the Group does business which is embedded into its culture,
policies and procedures.

Risk and Compliance teams perform
monitoring and IT security oversee the
implementation of appropriate tools to
perform monitoring.

Mandatory conduct training is undertaken
by all Group personnel. Group personnel are
adequately trained, supervised and must
remain competent in their responsibilities
and comply with legal regulatory standards.

Management Information is reviewed
periodically by committees including the
Investment Governance Committee.

See Anti-Corruption and Bribery section below.

The policy ensures that all client expressions of dissatisfaction
alleging financial loss, material distress or inconvenience are
resolved fairly resulting in good client outcomes.

Complaints handling management
information is reported to the Chief Risk
Officer and Board as appropriate.

Brewin Dolphin

Annual Report and Accounts 2020

Policy

Policy objective

Outcomes/impact/action taken

Human Rights
The Group’s exposure to human rights issues is limited, so we do not have specific policies for this. We take a zero-tolerance stance on slavery and
human trafficking within our workforce and supply chain and a rigorous vendor due diligence is completed regularly on suppliers. The Group’s Modern
Slavery and Human Trafficking Statement can be found on our website. See the ESG section on page 34 for more information.

Modern Slavery Policy

Approved by the Board

Speak Up Policy

The policy outlines the Group’s position in relation to modern
slavery and establishes a framework to facilitate the monitoring
and supervision of internal and external business dealings to
ensure we are not directly or indirectly facilitating modern slavery
of any kind and satisfy our legal obligations.

The policy provides guidance on regulatory obligations
and expectations concerning whistleblowing arrangements,
encouraging staff to report suspected wrongdoing and
concerns as soon as possible without fear or reprisals.

Modern slavery training is provided to staff to
be considered at higher risk of encountering
incidents of modern slavery.

Due-diligence is carried out prior
to onboarding any vendor asking for
confirmation of their adherence to
Modern Slavery Law.

An annual Speak Up Report is submitted
to the Speak Up Champion and Audit
Committee.

Appropriate training is provided
to Group personnel.

Approved by the Audit Committee

Anti-Corruption and Bribery

Anti-Bribery and Corruption
(‘ABC’) Policy

Approved by the Audit Committee

Vendor Management and
Outsourcing Policy
Approved by the
Risk Management Committee

Conflicts of Interest Policy

The policy sets out the Group’s requirements in respect of
Anti-Bribery and Corruption, helping to prevent Group personnel
and other associated parties from committing acts of bribery and
provide guidance to those working for the Group on how to
recognise and deal with bribery and corruption issues.

The policy ensures the Group enters and maintains relationships
with vendors on a commercial footing and is compliant with all
relevant laws and regulation.

The policy sets out minimum standards to identify and manage
conflicts of interest and take appropriate steps to identify,
prevent or manage conflicts that may arise in carrying out
business activities and also maintain effective arrangements
to prevent conflict causing damage to a client’s interests.

Approved by the Audit Committee

Gifts and Hospitality Policy

Approved by the
Risk Management Committee

The policy sets out the requirements that must be observed in
relation to giving or receiving gifts, hospitality to clients and third
parties, so that Group personnel understand the risks in relation
to gifts and hospitality.

ABC management information is reported
to senior management including Risk
Management Committee and breaches are
identified, monitored and reported.

ABC training and awareness is available for
all Group personnel.

Vendor management and outsourcing
management information is reported to
the Risk Management Committee on
a regular basis.

A Conflicts of Interest register is maintained
and reviewed by the Risk Management
Committee bi-annually and the Audit
Committee annually.

Mandatory training is an annual requirement
for all Group personnel along with an annual
declaration to disclose any Conflicts
of Interest.

Gifts and hospitality management information
is provided to the Risk Management
Committee on a monthly basis. Additionally
there are periodic checks of gifts
and hospitality.

Anti-Money Laundering and
Counter-Terrorist (‘AML & CT’)
Financing Policy

The policy sets out to mitigate the risk that Group could be used
to further financial crime (including money laundering and/or
terrorist financing) which meets the objectives of the regulators
and applicable laws.

AML & CT management information is
provided to the Risk Management Committee
and the Audit Committee and an annual
report is submitted to the FCA.

Approved by the Audit Committee

Description of principal risks and impact of business activity
see Principal Risks page 44.

Description of the business model
see Business Model page 12.

Mandatory training is an annual requirement
for all Group personnel.

Non-financial key performance indicators
The Group uses non-financial information in all aspects of its business, from development of its business model and strategy (pages 12 and 22)
to reviewing and measuring the principal risks (pages 47 and 48) and the performance of the business (pages 28 to 33). Key non-financial KPIs relate
to client satisfaction and employee engagement; more information can be found on pages 38 and 39.

The Risk Committee and Audit Committee consider non-financial matters as a matter of routine; their reports can be found
on pages 72 and 74 respectively.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationAgility & Resilience
Governance

What binds us together is a sense
of purpose, a shared set of values
and a strong culture.”

Simon Miller
Chairman

Brewin Dolphin

Annual Report and Accounts 2020

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationBoard of Directors

A leadership team creating
sustainable shareholder value

Simon Miller
Chairman

Robin Beer
Executive Director

Siobhan Boylan
Executive Director

Committee membership

Audit Committee

Nomination Committee

Remuneration Committee

Risk Committee

Denotes Chairman
of Committee

Ian Dewar
Senior Independent Director

Kath Cates
Non-Executive Director

Michael Kellard
Non-Executive Director

Phillip Monks
Non-Executive Director

Simonetta Rigo
Non-Executive Director

Caroline Taylor
Non-Executive Director

As at 30 September 2020

Length of tenure

Balance of Executive and
Non-Executive Directors

Gender diversity

■ Executive Directors
■ Non-Executive Directors

■ Male
■ Female

■ 6 years+
■ 3-6 years
■ 0-3 years

Brewin Dolphin

Annual Report and Accounts 2020

Simon Miller
Chairman

Appointed: Chairman March 2013,
Chair of the Nomination Committee,
Deputy Chairman and Senior Independent
Director 2012. Joined the Board in 2005.

Key areas of experience:
An Independent Non-Executive Director
with a wide range of experience in the
financial services sector, including wealth
management and investment management.

Current external appointments:
Chairman of BlackRock North American
Income Trust PLC, and Chairman of
Hampden & Co. Senior Independent
Director of STV Group PLC.

Previous experience: Called to the
Bar and subsequently worked for Lazard
Brothers and County NatWest. Chairman
of Dunedin Capital Partners.

Robin Beer
Executive Director

Appointed: Chief Executive Officer
June 2020. Joined the Group in 2008.

Key areas of experience: Wealth and
investment management, financial services
and operations.

Previous experience: Prior roles at
National Australia Bank, Gerrard and
Barclays. Member of the Group’s Executive
Committee since 2016.

Siobhan Boylan
Executive Director

Appointed: Chief Financial Officer
March 2019.

Key areas of experience: Finance,
investment management and
financial services.

Previous experience: CFO at
Legal & General Investment Management,
CFO of Aviva North America and
Aviva Investors. Qualified as an accountant
(ICAEW) at PricewaterhouseCoopers.

Ian Dewar
Senior Independent Director

Phillip Monks
Non-Executive Director

Appointed: February 2020.

Key areas of experience: Financial
services.

Current external appointments:
Chief Executive Officer of
Aldermore Group PLC.

Previous experience: Chief Executive
Officer of Europe Arab Bank PLC and
Gerrard Ltd and senior management
positions at Barclays Bank Ltd.

Simonetta Rigo
Non-Executive Director

Resigned: November 2020.

Appointed: June 2018.

Key areas of experience: Financial
services, marketing, product, digital
branding, customer relationships
and strategy.

Current external appointments:
Advisory Board Membership at
Surrey Business School.

Previous experience: Interim Chief
Customer Officer at Tesco Bank, SVP
Global Brand, Marketing and Customer
Engagement at Western Union and board
member at Western Union Foundation,
senior positions at Bupa International,
American Express and McKinsey and holds
an MBA from INSEAD.

Caroline Taylor
Non-Executive Director

Appointed: May 2014, Chair of
Remuneration Committee October 2018.

Key areas of experience:
Remuneration, financial services,
investment management, operations
and compliance.

Current external appointments:
Non-Executive Director of Ecclesiastical
Insurance Office PLC, Ecclesiastical
Insurance Group PLC and Floors Castle
Outdoor Events Limited.

Previous experience: Director of
Goldman Sachs Asset Management
International and Director of GS
Luxembourg and Dublin Mutual Funds.

Appointed: November 2013, Chairman of
Audit Committee March 2014. Appointed
Senior Independent Director July 2019.

Key areas of experience: Finance,
financial services, audit, risk management
and not-for-profit.

Current external appointments:
Non-Executive Director of Manchester
Building Society and Non-Executive
Director of Arbuthnot Banking Group PLC.

Previous experience: Partner of KPMG
and Non-Executive Trustee of a charity.
Qualified as a chartered accountant
(ICAEW) at KPMG.

Kath Cates
Non-Executive Director

Appointed: December 2014, Chair of
the Risk Committee September 2015.
Senior Independent Director until July
2019. Kath will not seek re-election
as a Director at the next AGM.

Key areas of experience:
Risk, international financial services,
operations, corporate governance,
investment management and insurance.

Current external appointments:
Non-Executive Director and Chair
of the remuneration committee for
RSA Insurance Group plc, Non-Executive
Director of Threadneedle Investment
Services Limited. Non-Executive Director of
Threadneedle Asset Management Holdings
S.A.R.L, Threadneedle Pensions Limited.
Non-Executive Director of United Utilities
Group PLC and TP ICAP plc with effect
from 1 February 2021.

Previous experience: COO in wholesale
banking for Standard Chartered Bank and
spent 22 years in various roles at UBS,
including Global Head of Compliance.

Michael Kellard
Non-Executive Director

Appointed: December 2017.

Key areas of experience: Financial
services, wealth management, pensions
and life sector, sales and digital financial
service platforms.

Current external appointments:
Director Brae Lea Financial Ltd.

Previous experience: CEO of AXA Wealth
Management, CEO of Winterthur Life and
CEO and Sales Director and Distribution
Director for the Life and Pensions division
of Norwich Union. Member of Scottish
Future Growth Council.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Governance Report

Chairman’s introduction to
corporate governance

We believe that our culture is strong and we are proud of our
values, Genuine, Expert and Ambitious. These continue to be
fully supported by the Board. The Board considers that a positive
culture is vital to the delivery of long-term value for our
stakeholders. In 2020 we ran the sixth Employee Engagement
Survey. The survey is a valuable way for the Board to understand
the views of our employees and in turn enhances business
performance. This year our engagement score increased.

There have been a number of Board changes in the year.
David Nicol retired as Chief Executive and Kath Cates has
decided not to seek re-election at the 2021 AGM following six
years with the Company. I have already expressed my thanks to
David for the last seven years as Chief Executive and I should like
to pay tribute to Kath for her valuable contribution as Chair of the
Risk Committee and a Non-Executive Director. Simonetta Rigo
resigned on 13 November 2020 in order to take up an executive
role and Charles Ferry will be appointed as an Executive Director
with effect from the conclusion of the 2021 AGM, subject to
regulatory approval. Further details are contained in the
Nomination Committee report on pages 70 to 71.

Robin Beer replaced David Nicol as Chief Executive Officer in
June 2020. The relationship between the Chairman and the Chief
Executive Officer is key to the success of the Board as a whole
and depends on a shared purpose. Throughout his time at Brewin
Dolphin, Robin has been a strong advocate of our culture. Culture
will continue to be the foundation for the future success of the
Group. Further information about the Chief Executive Officer
selection is on page 71.

As mentioned in last year’s report, I became Chairman in 2013
after joining as a Non-Executive Director in 2005. The 2018
Code states that service of more than nine years should be
a critical factor in succession planning. As such I have decided
to step down at the 2021 AGM. Ian Dewar, as Senior
Independent Non-Executive Director, led the search for my
replacement. I took no part in the process. Toby Strauss will
become Chairman following the AGM in 2021 and I am confident
that he will be a success and carry the Group through the
next stage of its strategy. Toby and Robin will continue the
collaborative and strong relationship between Chief Executive
Officer and Chairman. There is further insight into the search
process on page 71.

Simon Miller
Chairman

The Board remains committed to providing effective leadership
within the corporate governance framework to enable the
delivery of our strategy and create long-term value for all
of our stakeholders.

We hold eight scheduled Board meetings each year and meet
informally on other occasions. This year, as a result of the
COVID-19 pandemic, the Board has had to adapt to a new way
of conducting its engagement with each other. The governance
structure enabled us to successfully manage new working
practices. I am proud of the way that the business swiftly
adapted its working practices during this turbulent time.
Further information on our COVID-19 response can be found
on pages 66 to 67.

We place importance on the responsibilities which we have
towards our stakeholders, page 65 set out the key stakeholders
and how their interests have been taken into account in the
decision-making process. Caroline Taylor is the Board’s
representative for employee engagement. This role has been
particularly important in the current environment. She attended
employee forums organised by our network of Engagement
Partners and reported her findings to the Board. Please see page
62 for more information. Her feedback was that the Engagement
Partners had been highly effective in their role, that employees
generally felt connected to the leadership and that morale
remained high.

Brewin Dolphin

Annual Report and Accounts 2020

New appointments enhance debate around the Board table
and I am comfortable that all of the changes will strengthen
our ability to achieve the Group’s strategic aims.

Our Committees continue to operate effectively.
Further information on the work of the Committees can be
found on pages 68 to 99.

Sustainability is an area of increasing focus for the Group and
a Sustainability Committee has been established this year.
It will report to the Board via the Executive Committee.
The Sustainability Committee will enhance the work we currently
do to engage our stakeholders.

This year the AGM will be broadcast via webinar and I encourage
shareholders to watch and listen to the AGM proceedings
on 5 February 2021. Full details are contained in the Notice
of Meeting.

Simon Miller
Chairman

24 November 2020

UK Corporate Governance Code
Compliance statement

The Board reviewed the principles and provisions of the
UK Corporate Governance Code 2018 (the ‘Code’).
Following this review, the Board is pleased to confirm that
the Company has complied with the Code for the financial
year ended 30 September 2020, except for the tenure of the
Chairman. As stated last year our Chairman was appointed
in 2013. He will not be seeking re-election at the 2021 AGM.
The Code can be found on the Financial Reporting Council
(‘FRC’) website, www.frc.org.uk and further information
on compliance with the Code can be found below.

Board leadership and stakeholder
engagement
Board of Directors
How the Board spent its time
Stakeholder engagement

Division of responsibilities
Governance framework

Composition, succession and evaluation
Nomination Committee report
Board evaluation
Diversity

Audit, risk and internal control
Audit Committee report
Risk Committee report

Remuneration
Remuneration Committee report

Compliance with S.172 of the
Companies Act 2006
Consideration of the interest of all stakeholders

Pages

54-55
60
64-65

70-71
61
62-63

74-78
72-73

79-99

14, 65

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther Information
Corporate Governance Report

Governance framework –
leading from the top

Board

Delegated
Committees

The Board has principal responsibility for promoting the long-term strategy and success of the
Group and provides strategic leadership. It sets the Group’s values and standards which
underpin our culture.

The Board delegates certain responsibilities to the Board Committees below, whilst maintaining
an appropriate level of oversight through regular reports from Committee Chairs.

The Matters Reserved for the Board and the Terms of Reference for the
Board Committees can be found on the Investor Relations section of the website
brewin.co.uk/group/investor-relations.

Risk
Committee

The Committee
provides oversight
of the Risk
Management
Framework of the
Group and assists
the Board with its
responsibilities for
ensuring the
integrity of the
Group’s internal
control and risk
management
systems.

Audit
Committee

The Committee
helps the Board
meet its
responsibilities for
the integrity of the
Group’s financial
reporting, including
the effectiveness of
its internal financial
control system,
and for monitoring
the effectiveness
and objectivity of
the internal and
external auditors.

Nomination
Committee

The Committee
ensures that the
Board retains an
appropriate
balance of skills
to support the
strategic objectives
of the Group and
that there are
appropriate
procedures in place
for the nomination,
selection, training
and evaluation of
Board members.
It also ensures that
there is an effective
framework for
succession
planning.

Remuneration
Committee

The Committee
exercises
independent
judgement on
remuneration
policies and
practices, and the
incentives created
to manage risk,
capital and
liquidity. It also
oversees personal
objectives,
performance
appraisal and
individual
compensation
packages for the
Chairman and
Executive
Directors.

Executive
Committee

The purpose of the Executive Committee is to support the Chief Executive Officer in the
implementation and formation of strategy, as well as overseeing the day-to-day running of the
Group. It agrees operational decisions that are not otherwise reserved for the Board.

The Committee consists of the Chief Executive Officer, Chief Financial Officer and members
of senior management from different areas of the business. The Committee meets monthly.

Disclosure
Committee

The Disclosure Committee focuses on discharging the Company’s duties in accordance with
the EU Market Abuse Regulation. It comprises the Chief Executive Officer, Chief Financial
Officer, either the Company Secretary or Head of Legal (as alternate), plus either the Chief Risk
Officer or the Head of Compliance (as alternate).

Brewin Dolphin

Annual Report and Accounts 2020

A clear division of responsibilities

The Board has a majority of Independent Non-Executive Directors. Further information on the Directors’ range of skills and expertise can
be found on pages 54 to 55.

Chairman

Provides leadership to
the Board, promoting
constructive debate
and challenge between
the Executive and
Non-Executive
Directors.

Ensures that there
is a good information
flow to the Board,
and from the Board
to its key stakeholders.

Supports and advises
the Chief Executive
Officer, particularly
on the development
of strategy.

Builds an effective and
complementary Board,
regularly considering its
composition and
balance, diversity and
succession planning.

Chief Executive
Officer

Provides leadership
to the Group.

Develops strategy
proposals for
recommendation
to the Board and is
accountable for
business performance.

Maintains a dialogue
with the Chairman on
all important matters
and strategic issues
facing the Group.

Ensures that there is
an effective framework
of internal controls,
including risk
management, covering
all business activities.

Ensures that the Board
is fully informed of all
key matters.

Chief Financial
Officer

Supports the Chief
Executive Officer in
developing and
implementing strategy.

Oversees the financial
delivery and
performance of the
Group and provides
insightful financial
analysis that informs
key decision making.

Leads investor relations
activities and
communication with
investors alongside the
Chief Executive Officer.

Works with the Chief
Executive Officer to
develop budgets and
medium-term plans
to support the
agreed strategy.

Senior
Independent
Director

Acts as a sounding
board for the Chairman
and serves, when
required, as an
intermediary for the
other Directors.

Meets with the
Non-Executive
Directors (without the
Chairman present)
at least once a year.

Leads the Board in
the ongoing monitoring
and annual evaluation
of the Chairman’s
performance.

Available to meet
with major shareholders
and act as a point
of contact for
shareholders and
other stakeholders.

Independent
Non-Executive
Directors

Constructively
challenge management
and decisions taken
at Board level.

Oversee the
performance of
management in
meeting agreed goals.

Support the Chairman
and Executive Directors
in instilling appropriate
culture, values and
behaviours in the
boardroom and across
the Group.

Challenge the
adequacy and
quality of information
received prior to
Board meetings.

Board and Committee attendance record1
Member
Executive Directors
Robin Beer4
Siobhan Boylan
David Nicol3
Non-Executive Directors
Simon Miller
Ian Dewar
Kath Cates
Michael Kellard5
Simonetta Rigo6
Caroline Taylor
Phillip Monks2

Independent Board

Audit

Risk Remuneration

Nomination

N
N
N

N
Y
Y
Y
Y
Y
Y

3/3
9/9
6/6

9/9
9/9
9/9
8/9
9/9
9/9
5/5

n/a
n/a
n/a

n/a
7/7
7/7
6/7
n/a
n/a
n/a

n/a
n/a
n/a

n/a
5/5
5/5
n/a
5/5
n/a
n/a

n/a
n/a
n/a

6/6
6/6
n/a
n/a
5/6
6/6
n/a

n/a
n/a
n/a

3/3
3/3
3/3
n/a
n/a
3/3
n/a

1. The table shows attendance at scheduled meetings only. The Board and Committees also meet on an ad hoc basis when required.
2. Phillip Monks was appointed to the Board on 10 February 2020. He attended all Board meetings held from his date of appointment.
3. David Nicol stepped down from the Board on 14 June 2020 and attended all Board meetings to that date.
4. Robin Beer was appointed to the Board on 15 June 2020. He attended all Board meetings held from his date of appointment.
5. Michael Kellard provided input prior to the Board and Audit Committee meetings that he was absent from.
6. Simonetta Rigo provided input prior to the Remuneration Committee meeting that she was absent from.

Effectiveness

For the Directors to discharge their responsibilities as set out in the Matters Reserved for the Board, the Board meets at least eight times
a year. A full list of Matters Reserved for the Board can be found on our website. In addition, the Board attends a strategy day with
executive management to discuss in depth the Group’s direction. Details of the Board and Committee attendance at scheduled meetings
can be found above. The Board and Committees also meet on an ad hoc basis when required, see pages 66 and 67 for more information
on how the Board responded to COVID-19.

www.brewin.co.uk

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Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Governance Report continued

How the Board spent its time
Key considerations Key activities

Strategy

• The Board held its annual

strategy day to discuss the
future strategic pillars.

• Assessed performance of the

Group against previously agreed
strategic objectives.

In practice1

Board strategy day

Robin Beer led his first strategy day as the newly appointed Chief
Executive Officer. The objective was to review the current strategy,
purpose and direction of travel to provide clarity and alignment
of key objectives.

Significant outcomes included the importance of managing strategic
priorities, data analysis and client insight.

Following the strategy day, Robin Beer cascaded his vision of the
future to the Group.

Finance

• Received reports from the

Dividend

Risk and
compliance

People and
culture

Chief Financial Officer including
the Medium-Term Plan.

• Considered and debated the
payment of the interim and
full-year dividend.

• Considered the Group’s

Tax strategy.

The Board debated the risks and benefits of the current dividend
policy, including the options available in light of the volatile
economic environment. It concluded that the total dividend for the
year should be 14.3p.

• Received reports from the Chief

FCA session

Risk Officer.

• Approved the increase in capital

to be held following the
completion of the ICAAP.
• Engaged with the FCA to

discuss regulatory updates.

The FCA attended the Board meeting in November 2019 to discuss
topical issues relevant to both parties that included:

• SREP letter
• CASS
• Change Management Programme
• Outcomes of the ‘Your Future Your Say’ survey (see page 38

for further details)

• Received regular updates from

Integration of ICIIL employees

the Group People and
Sustainability Director.

• Received regular updates on the
integration of ICIIL employees.
• Updates received from Caroline

Taylor, the Employee
Engagement representative.
• Approved the appointment

of the Chief Executive Officer.

The Board received the results of the Employee Engagement
Survey that included an update of the integration of the employees
on-boarded from the ICIIL acquisition. The Board considered
measures that could be taken to enhance engagement in specific
business areas.

Governance

• Established Sustainability

Sustainability

Committee.

• Framework of oversight around
the delivery of change agenda.

• Implementation of the UK
Corporate Governance
Code 2018.

• Stakeholder engagement.
• Evaluated Board and

Committee performance.

The Board discussed and received presentations on ESG.
A Sustainability Committee has been established to define
sustainability goals for the Group that align with the Group’s strategy.
The output of this Committee will be reported in next year’s Annual
Report and Accounts.

1. The Board considered stakeholders in relation to the above key considerations, more information can be found on pages 64 and 65.

Focus for 2021

The Board will focus on technology, innovation, ESG and expanding our distribution channels in 2021. For further information,
please see pages 22 to 23.

Brewin Dolphin

Annual Report and Accounts 2020

Board evaluation

The Board and its Committees undertake an annual evaluation
of their performance. The process provides an opportunity
to appraise effectiveness and to identify areas of development
as well as follow up on actions from the previous review.
An externally facilitated evaluation will be undertaken next year.

During the year, the Chairman, assisted by the Company
Secretary and the Chairs of the Audit, Nomination, Risk and
Remuneration Committees, undertook an internal review of
Board and Committee effectiveness. The review was conducted
internally using Independent Audit’s online tool, Thinking Board.
The aim of the tool is to engage respondents, helping them to
think through underlying drivers of effectiveness. Independent
Audit have no other relationship with the Company.

The Board and all regular Committee attendees were invited
to complete the online survey to assess the performance of the
Board and its Committees.

Views were sought on a number of topics such as Board
composition, culture, working together, succession planning,
talent management, technology, strategy and financial reporting
and controls. The questionnaires were designed to capture the
pace and impact of the agreed development actions from the
prior year’s review and to assist in identifying areas of focus for
the forthcoming year.

The comprehensive output from Thinking Board was analysed
and formed the basis of the final reports which were received by
the Board and Committee Chairs and discussed at the respective
meetings in October 2020. Overall the Board and its Committees
continue to operate effectively within an inclusive and open
environment. Whilst progress has also been made on the actions
identified in the previous effectiveness evaluation, these will
continue to be ongoing themes for the following year.

2020 performance
evaluation outcomes

Oversight of change management
by the Board

Ensure continued consistent oversight
of technological implementation through
enhanced reporting and governance.

Actions taken

Actions for 2021

• Attendance by major technology

Cyber risk

suppliers at Board and Committee
meetings during the year, to ensure
continued governance and oversight
for new core custody and
settlement system.

• Independent assurance of effectiveness

of projects continued with regular
attendance at Board meetings.

Continue to evolve and improve the
information the Board receives on
cyber risks faced by the Group and
review mitigation.

Allocation of time to business and
strategic topics at Board meetings

• Improvements made in the year and

will be continually worked on.

Review format and content of Board
and Committee papers and agendas to
enhance information flow, effective debate,
decision making and ensure focus on
strategic development.

Consolidating strategy

Creating dedicated time in meetings
to focus on the strategic objectives that
matter most to the Group’s long-term
success, and to ensure consistent
articulation of our strategy. This will
include reviewing the impact of
technology in the short and medium-
term, and focusing on developing our
ESG strategy.

Sequencing of succession

Continued evaluation of tenure and
succession for Board and key
management positions.

• Changes made to the Board with new
Chief Executive Officer and Chairman
to be appointed at the 2021 AGM, as
well as the addition of a Non-Executive
Director and Executive Director.
• Succession planning to continue

beyond 2021 and will be remit of the
new Chairman.

Board dynamics

Effectively leverage the combined
knowledge and experience of existing
and newly appointed Board members.

The Board continues to make a
difference in helping management
deliver the strategy.

Engagement with the business
outside Board meetings

Provide the Board with greater exposure
to key business managers.

• Regular attendance by business

Board process

leaders at Board meetings to engage
with Directors about their area
of the business.

Continuing the progress in structuring
the agenda around what really matters
to our success.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Governance Report continued

Employee Engagement

Caroline Taylor
Non-Executive Director responsible for employee
engagement

What activities did you undertake during the year
as the Non-Executive Director responsible for
employee engagement?

A As a responsible employer we prioritise

employee engagement because we believe that
engaged colleagues lead to higher performance
which in turn delivers better client outcomes.
Therefore, our approach to employee engagement
needs to be thorough and considerate.

Since last year we have focused on a number of areas
with our Engagement Partners. Engagement Partners
work with local management on areas that matter
to our people on the ground. Themes included,
understanding change across the organisation and
how this impacts engagement. We explored how we
could improve on the question of “senior leaders are
in touch with what really goes on in the organisation”,
and we provided an update on ‘Your Future Your Say’
survey 2020.

The importance of workforce engagement and the role
of the Engagement Partners has been highlighted
during the COVID-19 pandemic. We have been able
to engage with the workforce and the communities
in which we operate through the established
Engagement Partner network. Engagement Partners
met on a more regular basis during the lockdown
to discuss the response to COVID-19 and workshops
were held to discuss topical themes. I attended the
workshops in order to provide the Board’s perspective
on the topics being discussed and was available for
questions from the Engagement Partners. I was kept
up to date and involved about how employees were
managing during the period of remote working.
The Engagement Partners met and discussed the
importance of listening to employees in unprecedented
times, explained different emotional responses
to COVID-19 and the hierarchy of needs, we also
discussed the role of the Engagement Partner during
this time and how to maintain momentum and strike
a balance between home and work.

As lockdown continued the Engagement Partners
were given action to seek feedback from their teams
on how well people felt they were able to perform their
jobs and how well they believed Brewin Dolphin was
maintaining its services to its clients. We also revisited
the topic of senior leaders’ engagement.

As well as referring my findings from these sessions
to executive and Board members, I provided the Board
with formal updates during the year at the Board
meeting in order that they could better understand and
“connect” with the workforce.

My main finding for the year is that the workforce is
engaged and committed to doing the right thing for
all its stakeholders. We have much that we are proud
of and I look forward to the next year.

Time commitment

The expectation of the Non-Executive Directors’ time commitment
is set out in their letters of appointment. Copies will be available
for inspection at an agreed time at the registered office of the
Company. Their attendance, along with Executive Directors,
at meetings during the year is set out in the table on page 59.

Directors’ conflicts of interest

The Board has a policy in place for managing and, where
appropriate, approving conflicts or potential conflicts of interest.
All Directors are provided with an opportunity to disclose
any changes in conflicts at the start of every meeting.
Directors are required to seek prior approval of external
directorship appointments.

Independence of Directors

All Non-Executive Directors are independent, except for the
tenure of the Chairman. See page 57 for further information.
The Non-Executive Directors do not hold any positions that
conflict with their responsibilities.

Information flow

As part of the annual cycle, all Board Committees forward-plan
their agendas for the year to ensure that important issues are
addressed. The Chairman of each Committee works closely with
Company Secretariat and other relevant members of senior
management to agree areas of discussion or approval.

Director evaluation

During the year, the Chairman evaluated the performance of all
Directors in one-to-one meetings and the Senior Independent
Director evaluated the performance of the Chairman. It was
confirmed that each Director continued to deliver the required
commitment to his or her role and made an effective and valuable
contribution to the Group.

Accountability

An overview of the Group’s Principal Risks and Uncertainties and
a description of the Risk Management Framework can be found
on pages 44 to 48 in the Strategic Report. A description of how
the Board has discharged its responsibilities in relation to internal
controls and risk management is set out on page 103 of the
Directors’ Report.

Diversity and inclusion

The Nomination Committee considers the succession planning
for the Board as well as receiving the executive succession plan
for review and challenge. As part of this process, diversity is
considered in respect of race, gender, ability, background and
thought as well as the required skillset and experience to ensure
that the most suitable appointment is made. We are aware of the
recommendation of the Parker Review to increase ethnic diversity
on UK boards and participated in the survey issued by the
Department of Business Energy and Industrial Strategy. Ethnic
diversity is considered as part of recruitment and succession,
however, we currently have no members of the Board who fulfil
the ethnic diversity criteria as stipulated in the review. We
recognise that this an area that we need to improve and have
therefore aligned our succession planning goals to the Parker
Review’s ethnic diversity targets, by 2024.

Brewin Dolphin

Annual Report and Accounts 2020

The Hampton Alexander Review is committed to achieving a 33%
target for women on boards and in leadership teams of FTSE 350
companies by 2020. In the FTSE 250 the average number
of women on boards in 2019 was 29.6%. The percentage on
executive committees and their direct reports in 2019 was 27.9%.
We are pleased to confirm that we ranked 6th in the FTSE 250 for
our representation of women in senior leadership roles, our Board
as at 30 September 2020 was 44%. Following Simonetta Rigo’s
resignation in November and Kath Cates stepping down at the
end of the 2021 AGM, we will no longer meet the Hampton
Alexander target of comprising 1/3 women however, the Board
remains committed to diversity and fully intends to comply with
the targets again during the course of 2021. Our Executive
Committee and direct reports at 40%. This year we have gone
beyond our Women in Finance Charter target of 35% by the end
of 2021 by achieving 40%. We have now stretched our target
to 45% by the end of 2023.

The Group’s Diversity strategy is implemented through the
Diversity and Inclusion Committee which meets monthly.
Its four distinct objectives are to:

• encourage all employees to promote workplace diversity and

inclusion, recognise value and respect differences.

• create a working environment that supports the effective

contribution of everyone.

• ensure our people policies and processes are aligned to

and drive diversity and inclusion goals and values in support
of business strategy.

• improve diversity in the talent pipeline and at senior levels.

Details of diversity activities for the period can be found in the
Our People and Culture report on pages 38 to 39.

Climate change

We are committed to managing the wider social environment and
economic impacts of our operations which include the way we
deal with sustainability issues.

Brewin Dolphin understands the importance of reporting on our
response to climate change. We fully intend to comply with the
TCFD disclosure requirements and as a first step we made a CDP
disclosure in August this year. Furthermore, we will be answering
the TCFD related questions within our first UN PRI report in 2021.
Our new Sustainability team has been tasked with designing and
implementing Brewin Dolphin’s approach as a responsible
business, a crucial part of which is the environment. Further
details of recommendations made by the TCFD can be found in
the table below.

Further details of TCFD recommendations

Director induction

The induction programme for on-boarding newly
appointed Directors.

Board and
governance

• Board procedures
• Governance framework
• Evaluation process
• Director training programme

Business
introduction

• Structure
• Strategy
• Market environment

Finance

• Budget and forecast
• Management accounts
• Internal audit function
• Analyst/Investor overview

Risk and
regulation

• Regulatory landscape
• ICAAP
• Operational risk framework

Other

• Legal updates
• Culture
• People
• Information technology
and cyber security issues

• External auditors

Corporate governance

See the corporate social responsibility report on pages 40 to 41.

Strategy

Details of the ESG strategy are on pages 34 to 37.

Risk management

The risk management framework is presented on pages 44 to 48, including our principal risks
and uncertainties.

Metrics and targets

The Directors report details carbon emissions on pages 101 to 102.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Governance Report continued

Stakeholder engagement

Engagement with our stakeholders is key to a successful business and is an ongoing part of managing our business. Our six key
stakeholders and why we listen to them have been identified on pages 14 and 15.

Our stakeholders

How the Board is kept informed

Clients

• Client engagement reports
• Results of the annual client survey
• Updates from the Director of Marketing and Communications
• Weekly updates of news articles about the Group
• Updates on the implementation of Client Engage

Employees

• Updates from the designated Non-Executive Director for employee engagement, Caroline Taylor

(see page 62 for more information)

• Reports from the Group People and Sustainability Director
• Results from the annual Employee Engagement Survey (see page 38 for further information)
• Feedback and attendance at Group events such as Women@Brewin
• Board visits to regional offices provide an opportunity to receive direct feedback from employees

Shareholders

• The Chairman, Chief Executive Officer, Chief Financial Officer and Chair of the Remuneration

Committee engaged with major shareholders directly and indirectly

Regulators

• Engagement topics included executive remuneration, dividend and capital allocation
• Regular broker reports are provided to the Board that detail shareholder feedback
• The Company’s AGM is an opportunity for all shareholders to meet and question the Directors and

senior management

• The Board receives feedback from investors after the full and half year results announcements

from the Investor Relations team

• Regulatory updates provided by the Chief Risk Officer that included details of engagement with the

FCA’s supervisory team. The FCA attended the Board meeting in November 2019

• Chairman and Senior Independent Non-Executive Director met with the FCA during the year

to discuss factors that affect the business including succession
• Feedback from trade bodies, agencies and supervisory bodies
• The Board and Committees take the views of the regulator into consideration when agreeing the

Group’s Risk Framework as well as the design of remuneration structures

Suppliers

• Attendance at Board meetings by major IT suppliers in order to ensure accountability and maintain

good relationships

• Regular reporting from the business to update on performance of major suppliers

Society

• Regular report to the Board by Group People and Sustainability Director and Employee

Engagement Partner

• The Board received updates on CSR reporting including volunteering and charitable donations
• The Board received a presentation on ESG and the new Sustainability Committee

Brewin Dolphin

Annual Report and Accounts 2020

How stakeholder interests have influenced Board decision making

See S172 stakeholder engagement section on pages 14 to 15 for details of how the Group engages with its stakeholders.

Key decisions
and discussions

Chief Executive
Officer
appointment

Stakeholders

Employees
Shareholders
Regulators

How the Board considered
stakeholders during the year

The interview process focused on the abilities of each
candidate to lead the Group into the next chapter of its
strategy. In particular, consideration was given to the
leadership style of the individuals including the likely fit
with the Group's culture and values, as well as the
message it would send to the Group’s employees.

Our regulators were updated on progress of the
process and interviewed Robin Beer prior to his
formal appointment.

Annual report
sections

See page 71 for
details of the
recruitment process.

See pages 38 and 39
for details of the
Group’s culture.

Capital allocation

Shareholders
Employees
Clients

The Board takes into consideration the importance of
dividends to shareholders and the benefit of providing
sustainable shareholder returns, while recognising that
there may be a requirement, at times, to retain capital
within the Group to deliver its strategy.

See Chairman’s
Statement and the
Financial Review
on pages 6 and 28.

Society
Clients
Employees
Shareholders
Suppliers
Regulators

Establishment
of Sustainability
Committee and
allocation of
resource for an
increased focus
on sustainability
and ESG

The Group’s employees are key to the delivery of the
strategy and the allocation of resources to implement
the strategy needs to be balanced with providing
shareholders with sustainable returns. Equitable
allocation of resources is a key factor in employee
morale. Successful implementation of the strategy
will benefit both current and future clients, as the
Group continues to evolve its propositions and
maintain their relevance.

The Board recognised that there was a need to
formalise its approach to sustainability and ESG.
Understanding that it encompasses all of our
stakeholders through the three pillars as explained on
pages 34 and 35; responsible investment, stewardship
and being a responsible business. This initial step will
ensure all our stakeholders’ expectations are
considered and met appropriately. For example, the
provision of ESG investments for our clients will allow
them to exercise greater choice over their investments
and if they wish, overlay their sustainability ambitions.
Our employees, in line with society, have a greater
focus on sustainability and it is very much part of the
Group’s culture to “do the right thing”. The environment
and climate continue to be key areas for regulators and
the establishment of the Sustainability Committee will
secure appropriate focus on this important area.

See Environmental,
Social and Governance
section on page 34
and 35.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationCorporate Governance Report continued

Governance in practice –
COVID-19 response

How the events unfolded

Stage 1 – Early impact & readiness
10 Feb

First colleague COVID-19 communication

9 Mar

Executive & Senior Crisis Management
teams established

12 Mar

Scenario plans documented

15 Mar

Home working guidance published

16 Mar

17 Mar

Critical process changes published to enable
remote working

80% of colleagues move to home working
Review of critical vendors completed
Chief Executive Officer communication
to all clients

19 Mar Weekly Board briefings commence

23 Mar

97% of colleagues move to home working

24 Mar

Second Chief Executive Officer communication
to all clients

Stage 2 – Remote working
2 Apr

Annual leave / sickness policy changes

6 Apr

9 Apr

Emergency colleague loan facility
communicated

Third Chief Executive Officer communication
to all clients

Stage 3 – Restoration
4 Jun

COVID-19 secure office design signed off

8 Jun

2 new Keeping the Show on the Road (’KSOR’)
offices opened

Face to face client meetings reintroduced
and guidance published

6 Jul

3 pilot offices reopened

3 Aug

A further 21 offices reopened

7 Sep

London head office and other metropolitan
offices reopened

10 Oct

Scottish offices reopened

Stage 4 – Second lockdown
Oct/Nov Continued compliance with local
Government guidelines

Our response teams

Board

The Board has taken a hands-on approach to managing our
COVID-19 response, providing guidance and direction to the
Executive Committee and Crisis Management Team on all
aspects of the plan, bringing valuable external insight on how
other firms are handling similar challenges.

Executive Committee

As the senior leadership team with responsibility for day-to-day
operations of the business, the Executive Committee has
overseen our COVID-19 response. As the events started to
unfold, the Executive Committee was meeting on a daily basis
as it sought to understand the scale of the challenges, and the
options available to continue to serve clients safely and to ensure
the wellbeing of colleagues. With the aim of rapidly responding
to the evolving situation, the Executive Committee worked
collaboratively, making rapid decisions and providing the clear
direction needed.

Crisis Management team

With representatives from our client facing and support teams,
this team has been responsible for determining, directing and
executing the tasks required to keep our colleagues and clients
safe and run the business. Activities have included colleague
and client communications, process redesign, risk assessments,
HR policy changes, office redesigns, project management,
operational monitoring, and leadership support.

How we have helped our colleagues

Working from home

On the day that the UK government announced a nationwide
lockdown, 97% of our employees were already working from
home. All employees had laptops, homeworking capabilities and
video conferencing tools, enabling us to be fully operational from
day 1, with no degradation of service. Our technology team
oversaw an 800% increase in remote connections, a 1,600%
increase in video calls and an initial 300% spike in support calls
and chats. As homeworking appeared to be a longer-term need,
the Executive Committee provided all colleagues who needed it
with a £100 allowance towards the cost of equipment such as
a screen or ergonomic chair.

Keeping the Show on the Road (‘KSOR’)

Critical to preserving service was a small number of KSOR
colleagues located in Edinburgh, Newcastle, and more latterly
Edgbaston and Bath who volunteered to work from the office
to process mail and print critical documents, alongside a small
number of other critical office based tasks.

Brewin Dolphin

Annual Report and Accounts 2020

Wellbeing

Face to face meetings

We recognised that many clients still needed and highly valued
face to face interactions and the best way to serve them was to
allow face to face meetings. As lockdown measures were lifted,
we provided a safe and highly controlled approach for client
meetings to ensure that we could provide a great service to those
clients that did not want to discuss their finances on a phone
or video call.

How we have transitioned
to the new normal

Setting up COVID-19 secure offices

Our Premises and Facilities Team have led the design, set up
and control of our COVID-19 secure offices. With a focus on
social distancing and hygiene, offices have been provided with
additional signage, enhanced levels of cleaning, clear incident
protocols and new processes to ensure that colleagues,
clients, and other visitors remain safe at all times.

Colleague consultation

A major driver of opening offices has been to help colleagues who
were struggling to work from home from a wellbeing and
productivity perspective. The return to the office has been
completely voluntary and flexible, with employees consulted early
in the return to office project.

Managing the uncertainty

We have continued to flex our approach to office-based working
in line with local and national requirements. Our strategic intent
continues to be to ensure the wellbeing of our colleagues,
whilst meeting the needs of our clients and playing our role in
limiting the spread of the virus. We continue to communicate
frequently with our colleagues and provide the clarity and
direction that they need.

As an organisation, we were already committed to providing
benefits, support and opportunities that educate and enable
colleagues to be proactive in maintaining their wellbeing,
while having access to the right support when needed. As part
of our COVID-19 response, we have increased our focus on
social wellbeing. We have a network of Wellbeing Champions
who are trained as Mental Health First Aiders. Their role is vital
in supporting colleagues as well as letting us know where we can
add the most value with our wellbeing initiatives and support.
We have also been rolling out resilience training for all employees
and Managing Mental Health training for our line managers.
We have provided colleagues with a series of interactive webinars
on the topics of resilience, healthy eating, and sleep.

Communication

We focused on ensuring our communications have been timely
so that people had the right information and support at the right
time. We have an initiative called 'Singing from the balconies'
which has mainly focused on sharing entertaining and uplifting
videos to show what colleagues have been doing during
lockdown, including our senior leaders.

Team Brewin

Colleagues in all parts of the business have held virtual events
such as quizzes, cook-alongs and challenges to encourage
exercise, such as 'climbing Everest' as a team. In most cases the
teams have raised significant sums for charities while doing this.

Financial wellbeing

During the uncertainty of the pandemic, we looked to provide
financial wellbeing support. No colleagues have been furloughed
and we have not made any staff redundant directly because of
the pandemic. In addition, we gave access to interest free loans
for impacted households and flexible working for those that
needed it, which had no impact on pay.

How we have helped our clients

Communication

We recognised that during these periods of uncertainty that our
clients needed us more than ever. During this period, our client
facing teams have been contacting all clients, sharing valuable
insights, and keeping them up to speed with developments.

Process redesign & innovation

As a high touch service, many of our critical processes have been
built around face to face meetings and interactions. COVID-19
has acted as a catalyst for innovation with us now accepting,
sending and receiving digital signatures and documents,
with further enhancements under design and build.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationExecutive Committee Report

Looking ahead

Key areas of focus for 2020

Strategy

• Inorganic and organic
growth opportunities

• 1762 from Brewin Dolphin
• BPS
• Brexit
• ESG agenda

Operational

• Change management
• Property portfolio
• Regular updates from BD Ireland
• Impact of COVID-19

Risk &
compliance

• FCA interaction
• CASS
• Key risks
• Risk appetite
• SMCR

Employees

• Engagement survey results
• Learning and development initiatives
• Succession planning
• Diversity

Robin Beer
Chairman of the Executive Committee

The purpose of the Executive Committee is to support the
Chief Executive Officer in the implementation and formation
of strategy as well as overseeing the day to day running of the
Group. It has formal Terms of Reference which are reviewed
by the Board annually.

Following the retirement of David Nicol in June 2020,
Robin Beer was appointed Chairman of the Committee on
15 June 2020. He had been a member of the Committee since
2016. Grant Parkinson left the Group in September 2020 and
was replaced by Sarah Houlston as Chief Operating Officer.

Committee meetings

The Committee meets on a monthly basis and meetings are
minuted by the Group Company Secretary. The internal auditor
is a standing attendee. Non-Committee members are regularly
invited to attend and report on particular areas of the business
which are pertinent to the Group’s strategy.

The Committee has an agreed standard annual agenda to cover
key areas in the year. Prior to each meeting, the Chief Executive
Officer agrees the agenda with the Group Company Secretary.

Finance

• Business performance
• Budgeting
• Introduction of expenses

and payment system

Priorities for 2021

• Delivering performance against strategic pillars
• Implementation of new custody and settlement system
• Agreeing the Group’s approach on ESG
• Expansion of distribution channels

Committee composition

The Committee during the year comprised David Nicol
(retired 14 June 2020), Robin Beer, Siobhan Boylan,
Susan Beckett, Richard Buxton, Charlie Ferry, Nick Fitzgerald,

Grant Parkinson (resigned 30 September 2020)
and Sarah Houlston (appointed 1 October 2020).

Brewin Dolphin

Annual Report and Accounts 2020

Robin Beer
Chief Executive Officer

See pages 54 to 55

Siobhan Boylan
Chief Financial Officer

See pages 54 to 55

Susan Beckett
Chief Risk Officer

Appointed: Joined the Group
and Executive Committee
in September 2014 and is
a Non-Executive Director and
Chair of the Board Risk
Committee for Brewin Dolphin
Wealth Management, Ireland
since 2019.

Key areas of experience:
Susan has 30 years of
experience in the financial
services sector. Her current
responsibilities include risk,
compliance, financial crime,
information security, data
protection, conduct risk and
CASS for the Group. Susan is
the executive sponsor of
Women@Brewin; a women’s
network aimed at influencing
a traditional culture to grow
and become more inclusive.

External appointments:
Non-Executive Director and
Chair of the Board Risk
Committee for the Scottish
Friendly Group.

Previous experience: Similar
senior leadership positions at
Schroders, JP Morgan,
Barclays Global Investors,
BlackRock, Kleinwort Benson
and BT Pension Scheme.

investment management.
Charlie joined Brewin Dolphin
as a Divisional Director in 2008,
became Regional Director for
London and the South East
in 2015, Co-Head of Private
Clients in 2016 before
becoming Managing Director
of Private Clients in 2017.
In 2020, he was appointed
Managing Director of wealth
and investment. In his role,
he is responsible for Wealth
and Investment services across
Brewin Dolphin, which includes
all offices within the Group,
the intermediaries business
and the marketing and
research departments.

Previous experience: Head
of London and South East
Gerrard Investment
Management. Started his
career in Corporate Finance.
He is a Chartered Fellow of the
Securities Institute and a
graduate of the Advanced
Management Program at
Harvard Business School.

Nick Fitzgerald
Managing Director
of Advice and Innovation

Appointed: Joined the Group
in 2008 and the Executive
Committee in February 2016.

Key areas of experience:
Nick has over 30 years of
experience in financial planning.
Nick joined Brewin Dolphin
to lead the integration of its
financial planning capabilities,
helping it to become the
advice-led business it is today.
He has been instrumental in
developing and broadening
the Group’s propositions and
services, such as launching
and building our ‘1762 by
Brewin Dolphin’ proposition.

Richard Buxton
Group People and
Sustainability Director

Appointed: Joined the Group
and Executive Committee in
February 2015.

Key areas of experience:
Richard has over 20
years of experience in the
financial services sector.
Richard joined Brewin Dolphin
as the Group HR Director
with responsibility for devising
and implementing the Group’s
first people strategy aimed
at creating a culture of high
employee engagement. His
responsibilities include learning,
leadership development, talent,
competence, and diversity and
inclusion. In 2020 he took on
responsibility for the Group’s
sustainability strategy.

Previous experience: Group
Talent Director at Lloyds
Banking Group and EMEA
Head of HR at Bank of
America. Fellow of the
Chartered Institute of
Personnel and Development.

Charlie Ferry
Managing Director
of Wealth and Investment

Appointed: Joined the Group
in 2008 and the Executive
Committee in February 2016.

Key areas of experience:
Charlie has over 20 years of
experience in the financial
services sector, specialising in

He has more recently taken
responsibility for enhancing the
client’s digital user experience
across all the propositions.

Previous experience: Head
of Financial Planning for
Barclays Wealth and Gerrard,
Lloyds Bank PLC and Lloyds
Retail and senior management
at Prudential high net
wealth division.

Sarah Houlston
Chief Operating Officer

Appointed: Joined the Group
in 2018 and the Executive
Committee in October 2020
when she became Chief
Operating Officer.

Key areas of experience:
Sarah joined Brewin Dolphin
in February 2018 as Head
of Change and Transformation,
and designed, mobilised and
managed the delivery of the
company’s portfolio of strategic
change projects. These have
included the programmes to
replace the client management
system and the core custody
and settlement system, as well
as the successful integration of
Investec’s Irish wealth business
into Brewin Dolphin Ireland.

Previous experience:
30 years at RBS, which
culminated in her being
Director of Banking Operations
for the future Williams & Glyn.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationNomination Committee Report

Delivering on succession

As reported in last year’s report, Paul Wilson stood down as
a Director in October 2019. Phillip Monks was appointed to the
Board in February 2020. He is currently CEO of Aldermore Group
PLC. Kath Cates has decided not to seek re-election at the AGM
in 2021. My successor will manage the search for a replacement
Chair of the Risk Committee. Simonetta Rigo resigned on
13 November 2020 in order to take up an executive position.

The Committee recently discussed whether the Board might
benefit from additional executive representation. Recognising the
value of clients to our business, the Committee recommended
that Charlie Ferry be appointed to the Board at the AGM in
February 2021. Charlie is currently the Managing Director of
Wealth and Investment and sits on the Executive Committee.
The appointment is subject to regulatory approval.

We remain committed to maintaining diversity at every level of the
organisation. The Committee discussed the findings of the Parker
Review and the new BAME targets introduced by the 30% Club
and we are fully supportive. We understand the value that
diversity brings to the sector.

Succession planning and talent review continues to be an
important remit of the Committee as the pipeline is key for the
business. The Committee reviewed and discussed talent and
succession at senior management and executive level with the
Group People and Sustainability Director and also learnt how
there was increased focus on career paths for mid-level
employees in order to strengthen the talent pipeline. The meeting
also discussed development opportunities within the Group.
They noted that career development conversations were
a mandatory section of the performance management process.

Simon Miller
Chairman of the Nomination Committee

24 November 2020

Simon Miller
Chairman of the Nomination Committee

The Committee reviews the effectiveness and composition of the
Board. During the year a number of changes to the Board have
taken place.

We announced in January 2020 that David Nicol had stated his
intention to retire from the Company as Chief Executive after
seven years of outstanding service. As part of the search to find
a successor the Committee followed a rigorous recruitment
process including both external and internal candidates facilitated
by Odgers Berndtson. I am delighted that we were able to
appoint an internal candidate, Robin Beer, as Chief Executive
Officer. Robin brings talent and experience to the role, with over
20 years in the financial services industry and broad knowledge
of the wealth management sector. He joined the Group in
2008 and the Executive Committee in 2016. He has a deep
knowledge of Brewin and its culture. His biography is on page 55.
Further details of the process followed for his succession are
outlined opposite.

Following the announcement that I will retire as Chairman at
the 2021 AGM, my successor will be Toby Strauss. Ian Dewar,
as Senior Independent Director, led the search for my
replacement, a process that I took no part in. Further information
on the process undertaken is set out opposite.

Committee composition

The Committee during the year comprised Simon Miller,
Caroline Taylor, Kath Cates, Ian Dewar and Paul Wilson
(resigned 9 October 2019).

The Chief Executive Officer and Group People and
Sustainability Director are standing attendees at Committee
meetings; the Chief Executive Officer and the Chairman
exclude themselves from discussions relating to their
own appointments.

Further details of membership and attendance can be found
on pages 55 and 59.

The responsibilities of the Committee are defined in the
Committee’s Terms of Reference, a copy of which can be
found at brewin.co.uk/group/investor-relations.

Brewin Dolphin

Annual Report and Accounts 2020

Ian Dewar
Senior Independent Director

Simon Miller
Chairman

Q What steps were taken to ensure an orderly
succession process for the Chairman?

Q What steps were taken to ensure an orderly

succession process for the Chief Executive Officer?

A Following the announcement of Simon Miller’s intention
to retire as Chairman, I led the search for his successor
and chaired the meetings of the Nomination
Committee where the search and recommendation
for appointment of the new Chairman were discussed.

The Non-Executive Directors were involved in the
interview and selection process with the exception
of Simon Miller, who had no involvement in the search.
The formal search process was supported by MWM
Consulting (‘MWM’), an independent search
consultancy which had been hired to provide
assistance to the Committee for this purpose.

The Committee created a candidate specification and
skills requirement matrix after feedback from all of the
Directors. This matrix was used by MWM to identify
potential candidates in the market. MWM presented
an initial list of candidates, which after discussion
with MWM was reduced to a shortlist. Potential
candidates were interviewed by members of the
Board, who provided their feedback to me. MWM
were invited to attend a Nomination Committee
meeting. The Committee met to discuss feedback and
a final meeting was held in late October 2020 to agree
the preferred candidate and make a recommendation
to the Board for approval.

A The succession plan was instigated and a review
undertaken of suitable candidates externally and
internally. The recruitment process was led by Odgers
Berndtson, an independent recruitment consultant.

A list of possible candidates was prepared
which included Robin Beer, the internal candidate.
Interviews were conducted by myself and the other
Non-Executive Directors. Specially convened meetings
of the Nomination Committee were held in December
2019 and January 2020 to discuss feedback from the
interviews. An additional Remuneration Committee
meeting was also held to agree remuneration.

After a full process managed by myself and the
Nomination Committee, the Committee agreed that
Robin Beer was the preferred candidate for the role
of Chief Executive Officer and recommended
the appointment to the Board for approval.
The appointment was made with effect from
15 June 2020.

David Nicol stood down on 14 June 2020 and
remained with the Group for a transitionary period until
29 July 2020. There was an important six-month
handover period for Robin prior to his appointment
as Chief Executive Officer.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationRisk Committee Report

Overseeing the
Risk Management Framework

The Committee was presented with updates on our operational
risk capital assessment throughout the year incorporating our
acquisition activity and changes in the external environment.
This included market volatility as a direct result of the COVID-19
pandemic. The key inputs for the operational risk scenarios were
more frequently updated, testing the sensitivity of the assessment
and ensuring our capital assessment remained adequate.

The Risk Management Framework has enabled us to effectively
manage risk as the environment has changed. Risk appetite
became a key area of discussion in the second half of the year
as we considered how the external environment impacted our risk
profile. This resulted in some temporary risk acceptance decisions
which are under continual review.

The Committee reviews deep dives into specific areas of
interest or concern. This year we received presentations on the
investment risk parameters for our portfolios, the risks associated
with the financial planning business and the governance oversight
of the Authorised Corporate Director of the Maitland Institutional
Brewin Dolphin Select Managers Funds. We oversaw the risks
associated with the integration of our Irish acquisition, BDCIIL,
and had a presentation from the local Irish business to enhance
our understanding of how the wealth management sector in
Ireland differs from that in the UK.

The key priorities for the coming year include, ensuring continued
business model resilience in the uncertain and challenging
economic environment. The successful implementation of the
core custody and settlement system and incorporation of
sustainability factors into our service offering including ESG
and climate change.

This is my final year as Chair of the Risk Committee and
Phillip Monks will be my successor. I would to thank the
Committee for its support and contribution, as well as the
Chief Risk Officer for her commitment in transforming the
Risk Management Framework.

Kath Cates
Chair of the Risk Committee

24 November 2020

Kath Cates
Chairman of the Risk Committee

During the year, the Committee continued to focus its oversight
on the key principal risks facing the Group, to ensure that the risk
profile of the Group remained within appetite.

Review of the change management agenda was a priority for the
Committee throughout the year. The implementation of our client
management system was a success. The replacement of the
Group’s core custody and settlement system continues to
dominate the change agenda. The Committee continued to
engage with Alpha, an independent external consulting firm who
provide independent challenge and assurance. Alpha provided
regular reporting to the Committee on the progress of the project
and feedback on the risks faced. The Committee reviewed the
resourcing challenges of the change agenda, which were
exacerbated as a result of the pending introduction of IR35
(anti-avoidance tax legislation) and COVID-19.

Since March we have increased the frequency and review of the
risks facing the business now and on the horizon. We adapted
quickly to the new remote working environment and were able
to take advantage of our established processes and controls.
These were amended where necessary to take account of the
changing working practices. This allowed us to shift our focus
to the potential risks impacting our business model, which was
a key area of discussion at our annual risk workshop, attended by
the Board and Executives. For example we discussed attrition risk
and the impact this has on Funds Under Management (‘FUM’).
As a Committee we have moved our attention from an operational
risk focus to one of business model resilience. The 2021
economic outlook remains the major area of concern.

Committee composition

The Committee during the year comprised Kath Cates
(Chairman) (stepping down at 2021 AGM), Ian Dewar,
Simonetta Rigo (resigned November 2020) and Paul Wilson
(resigned October 2019). Phillip Monks was appointed to the
Committee in November 2020 and will become Chairman of
the Committee (subject to regulatory approval) on 5 February
2021. There is cross-membership between this Committee and
the Audit and Remuneration Committees to ensure that
agendas are aligned, and key information is appropriately
shared across the Board Committees. The Chairman of the

Risk Committee attends the Remuneration Committee at least
once a year and is also a member of the Audit Committee.

Standing attendees at Committee meetings include the Chief
Executive Officer, Chief Financial Officer and the Chief Risk
Officer. Further details of membership and attendance can
be found on pages 55 and 59.

The responsibilities of the Committee are outlined in the
Committee’s Terms of Reference, a copy of which can
be found at brewin.co.uk/group/investor-relations.

Brewin Dolphin

Annual Report and Accounts 2020

The Committee’s key areas of focus

Key risks &
risk appetite

Reviewed the key risks facing the Group and debated potential risks on the horizon.

Recommended the Risk Appetite Statement, the Group Policy Framework and the Group Risk
Management Framework to the Board for approval. These help to set the agenda for the following
year for key areas of discussion.

Received training on risk appetite.

ICAAP and joint
meeting with
Audit Committee

Challenged the key components of the ICAAP during the year, exploring operational risk scenarios,
impacts of acquisitions and stress testing our regulatory capital against more extreme market
volatility, taking into consideration the impact of COVID-19.

The key inputs for the operational risk scenarios were more frequently updated, testing the
sensitivity of the assessment and ensuring our capital assessment remained adequate.

Conduct risk

Continued to oversee progress with the conduct risk frameworks.

Review of risks associated with the move to remote working.

Change programme

Continued oversight of the change programme. Engaged with the consultancy responsible for the
providing independent challenge and assurance for the new core custody and settlement system.

Regulatory change

Reviewed the key risks in relation to regulatory change legislation including SMCR and the
Fifth Anti Money Laundering Directive. Continued to monitor embedding of new processes to ensure
compliance and accountability.

Deep dives

Received presentations from business areas during the year that included:

• An update on Financial Planning
• Investment risk parameters
• Authorised Corporate Director of the Maitland Institutional Brewin Dolphin Select Managers Funds
• Integration of BDCIIL

Routine matters

Held Non-Executive Director only sessions before each meeting and met the Chief Risk Officer,
external auditor, internal auditor and the Head of CASS on an individual basis.

Reviewed the Terms of Reference for the Committee and disclosures for the Annual Report
in addition to dealing with routine governance matters.

Underwent a formal evaluation of its performance during the year. The results were discussed
by the Committee and have helped to inform forward-looking agendas.

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Strategic ReportGovernanceFinancial StatementsOther Information

Audit Committee Report

Enhancing our focus on
internal controls

We also focused on the impact that COVID-19 has had on our
balance sheet with additional scrutiny on the impairment testing
of goodwill and client relationship balances. Having reviewed the
results of those tests, we have concluded that there is
no impairment.

As mentioned in last year’s report, our external audit was subject
to a tender and we announced that Ernst & Young (‘EY’) would
be proposed to replace Deloitte at our forthcoming AGM. The
news from Germany about the alleged fraud at Wirecard came
after we had reached that decision. We have held constructive
talks with EY to understand the impact on EY in the UK and their
audit approach, particularly in respect of assets held with third
parties and have concluded that we should not change our
decision. A resolution for their appointment is therefore included
in the Notice of AGM.

Finally, a couple of thank-you’s. First, to Rob Topley and the team
from Deloitte for the constructive way they have acted as our
auditors over recent years. Their challenge and professionalism
have served us well. Second, to Kath Cates who steps down
from the Committee when she leaves the Board at the AGM.
I will miss her hugely valuable insights.

Ian Dewar
Chairman of the Audit Committee

24 November 2020

Ian Dewar
Chairman of the Audit Committee

2020 has not been the year that we were all expecting and has
presented challenges to everyone. We have moved to an
environment where work has moved from our offices to our
homes and to a ‘virtual’ world for communication. A major focus
for the Audit Committee has been to ensure that in the new
paradigm the sanctity of our control processes remains as robust
as it has always been. We have received reports from both our
risk function and internal audit on how the move to remote
working has gone and it is apparent that the investment we made
in IT equipment two years ago has really facilitated this. We also
asked Deloitte to focus on the impact of remote working on
controls and received a report back from them at our year end
meeting. Recognising that a focus on control is in the ‘Brewin
DNA’, I was not at all surprised to receive back positive reports
from all parties. Some processes have taken longer but there has
been a high level of diligence and our controls remain effective.

Committee composition

The Committee comprises only independent Non-Executive
Directors. The members during the year comprised Ian Dewar
(Chair), Kath Cates and Mike Kellard. There is a cross-
membership with the Risk Committee, to help ensure that
agendas are aligned, and key information is shared
appropriately across the Board Committees. Further details of
membership and attendance can be found on pages 55 and 59.

The Chief Executive Officer, Chief Financial Officer and Chief
Risk Officer are invited to attend at the Committee’s request.

In addition, all Non-Executive Directors including the
Chairman are entitled to attend. The external audit partner
and our internal audit partner are both standing attendees.
The proposed EY external audit partner attended the
Committee meetings alongside Deloitte. We have considered
the Financial Reporting Council (‘FRC’) requirement for the
Committee to have competence relevant to the financial
services sector and have concluded that the Committee,
as a whole, satisfies this requirement.

The responsibilities of the Committee are outlined in the
Committee’s Terms of Reference, a copy of which can be found
at media.brewin.co.uk/group/investor-relations.

Brewin Dolphin

Annual Report and Accounts 2020

The Committee’s key areas of focus

The Committee has a set agenda for the year although it will adapt to take account of changes in the business and the Board’s strategy
to ensure that there is challenge and oversight from an audit perspective and to ensure a strong control environment. The Committee’s
key areas of focus for 2020 were:

Financial reporting

Reviewed the Annual Report and Accounts, the quarterly trading updates, the Interim Report and
the investor presentations. Received reports on the key judgements and accounting policies
followed in the preparation of the Financial Statements.

Debated the proposal to pay an interim and full year dividend.

Reviewed reports from the external auditor on the Financial Statements. This included the significant
audit risks, areas of audit focus, the appropriateness of the significant management judgements
used in preparing the accounts and the effectiveness of systems of internal financial control.

Reviewed the Group’s Going Concern assumption and Viability Statement.

Received financial reporting updates from BDWM and BDCIIL.

Assessed the proposal to de-risk the Group’s Defined Benefit Pension.

Received an update on the Group’s tax position from the Head of Tax.

Assessed the capitalisation of IT software, primarily in respect of Avaloq and Client Engage.

External auditor

Approved the external audit plan, the external auditor’s terms of engagement and the fees to be
paid to the external auditor for the audit of the 30 September 2020 Annual Report.

Assessed the independence, objectivity and effectiveness of the external auditor.

Strengthened and approved the policy relating to non-audit services provided by the
external auditor.

Received reports on the Financial Statements.

EY attended Committee meetings as part of the transition process.

Discussed the impact of the alleged fraud at Wirecard on EY’s audit approach.

Internal auditors

Reviewed and approved the internal audit plan for the year.

Received quarterly internal audit reports, challenged the robustness of their findings and agreed
appropriate actions with management.

Reviewed how issues identified for action, whether arising from internal audit reports or from internal
control processes, are identified, progressed and reported; this ensures there is an effective
framework for the management of issues within the Group.

Control oversight

Received, reviewed and discussed the Control Environment Report, the Annual Money Laundering
and Financial Crime report.

Reviewed the Group’s annual Speak Up report and considered matters for Board escalation.

Reviewed and discussed the six-monthly updates for both the Client Money and Assets report
(‘CASS’) and Audit Assurance Faculty report (‘AAF’).

Assessed the internal controls as a result of the move to remote working.

Approved the appointment of the Head of Financial Crime (CF11).

ICAAP

Jointly reviewed the ICAAP with the Risk Committee. After reviewing and challenging the ICAAP
and its key components, the Committee recommended its approval to the Board.

Routine matters

Reviewed the Committee’s performance.

Reviewed and approved the Committee’s Terms of Reference and minutes.

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Strategic ReportGovernanceFinancial StatementsOther InformationAudit Committee Report continued

Significant matters related to the Financial Statements

We reviewed the significant matters set out below in relation to the Group’s Financial Statements for the year ended 30 September 2020.
We discussed these issues at various stages with management during the financial year and during the preparation and approval of the
Financial Statements. We are satisfied that the Financial Statements appropriately address the critical judgements and key estimates,
in respect both of the amounts reported and the disclosures made, following review and consideration of the presentations and reports
presented by management. We also reviewed these issues with the auditors during the audit-planning process and at the conclusion
of the year-end audit. We are satisfied that our conclusions in relation to these issues are in line with those drawn by the auditors.

Matter

Key considerations Role of the Committee

Acquisitions (see note
4.a.i. to the Financial
Statements)

Appropriate application
of IFRS in relation to
the recent acquisitions,
specifically in relation
to establishing the fair
value of all the assets/
liabilities acquired.

We considered management’s proposed accounting treatment
for the acquisition of Investec Capital & Investments (Ireland)
Limited (see note 35 to the Financial Statements) including
satisfying ourselves as to the fair value attributed to the client
relationships and goodwill in the Financial Statements as
intangible assets as a result of the acquisition. In particular,
we challenged whether the fair value attributed to the client
relationships was set correctly.

Leases (see notes
4.a.ii and 4.b.iv to the
Financial Statements)

Appropriate application
and disclosure of IFRS
16 ‘Leases’ the new
accounting standard
adopted by the
Group in the current
reporting period.

Pre-transition we reviewed management papers on the
transition method to be applied by the Group and the expected
impact on the Financial Statements. We agreed that the Group
should apply the modified retrospective approach with the
cumulative effect of initial application being recognised at the
transition date.

We confirmed that the opening balance sheet aligned with the
expected result per the management paper and that the critical
accounting judgement and key source of estimation uncertainty
outlined in the paper had been disclosed.

Further, the disclosure of the impact on the Group’s Financial
Statements was considered, to ensure that it was
understandable and concise.

Impairment of
goodwill, client
relationships and
brand (see note 4.b.ii
to the Financial
Statements)

Appropriate application
of IFRS and underlying
principles.

Determining the best
estimate of the likely
cash flows and other
assumptions for
the value in use
calculations and the
resulting sensitivities.

We reviewed management’s paper explaining the assumptions
and calculation methodologies applied in determining the
recoverable amounts for both the individual intangible assets
and the Cash Generating Units (‘CGUs’) and outlining the
sensitivity.

We challenged whether the procedures performed by
management were robust and comprehensive.

This included considering the assumptions of the
Medium-Term Plan (‘MTP’) and confirming that it took into
consideration expected external impacts to the Group such
as COVID-19 as well as aligning with the Group strategy.

Amortisation of client
relationships (see note
4.b.iii to the Financial
Statements)

Determination of the
useful economic life
of client relationships,
which establishes the
quantum of the
amortisation expense.

We considered the paper prepared by management on the
average client tenure and useful economic life expectations.
We challenged whether the metrics used were set to the
appropriate level for both the acquisition in the current reporting
period and historical acquisitions.

Conclusion

We concluded that the
determination of the
fair value of the assets
was set to the
appropriate level.

We concluded that new
accounting standard
had been appropriately
applied and that the
disclosure of the impact
on the Group’s Financial
Statements was clear.

We concluded that
the assumptions
and calculation
methodologies applied
by management were
appropriate including
the use of the MTP to
determine the Value In
Use (‘VIU’) estimate.
On this basis there
was no impairment
to be recognised
for the Group’s
intangible assets.

We concluded that the
assumptions and
judgements used were
reasonable and we were
satisfied that the useful
economic life
expectations were
appropriate, reflecting
both experience and
future expectations.

We concluded that
the assumptions
and judgements used in
determining the defined
benefit pension scheme
liability were appropriate.

Assumptions
underlying the
calculation of the
defined benefit
pension scheme
liability (see note
4.b.iv to the
Financial Statements)

Determination of the
actuarial assumptions
such as discount rate,
the life expectancy
of scheme members
and the inflation rate
used when calculating
the defined benefit
pension scheme
liability.

Likelihood of meeting
performance
conditions for the
long-term incentive
plan (see note 4.b.vi
to the Financial
Statements)

Determining the
likelihood of meeting
the performance
conditions which
impact the quantum
of the expense
in the period.

We considered management’s paper explaining the
assumptions used in the calculation and the resulting impact on
the balance sheet. We challenged whether the assumptions
remained appropriate given the surplus
in the scheme.

We considered management’s paper explaining the
assumptions for the likelihood of meeting the performance
conditions. We challenged whether the assumptions were
appropriate as awards do not always vest in full.

We concluded that
the assumptions
used in calculating
the expense
were appropriate.

Brewin Dolphin

Annual Report and Accounts 2020

Fair, balanced and understandable Report and Accounts

The Committee receives a report and performs a review to ensure the Group’s Annual Report and Accounts are fair, balanced and
understandable. What is meant by these terms, and the questions that the Committee considers as part of this review,
are shown below:

Term

Fair

Balanced

Description

Questions

Committee’s conclusions

The Committee is of the opinion that
the Annual Report and Accounts
articulates how the Group has
performed during the year, providing
full disclosure and forward looking
statements. Therefore, we are of the
opinion that the disclosures present
a fair reflection of the performance
of the Group.

There is consistency between the
narrative sections and the Financial
Statements and an appropriate
balance of positive and negative
messaging in the narrative reporting.

• Not exhibiting

any bias

• Reasonable
or impartial

• Performed according

to the rules

• Even-handed
• Taking account of all
sides on their merits
without prejudice
or favouritism

• Is the whole story being presented?
• Have any sensitive material areas

been omitted?

• Is there a good level of consistency

between the front and back sections
of the Annual Report?

• Does the reader get the same
message from reading the two
sections independently?

• Is there a balance between positive and
negative messages in the narrative?
• Are the key judgements referred to in

the narrative reports and the significant
issues reported in the Audit Committee
Report consistent with the disclosures
of key estimates and uncertainties
and critical judgements set out in the
Financial Statements?

Understandable

• Having a meaning

• Is there a clear and cohesive framework

or nature that can be
understood

• Able to be accepted

for the Annual Report?
• Is the report written in
accessible language?

as normal

• Are the messages clearly drawn out?

Enhancements have been made
to the governance section of the
report from last year in order to make
the report clearer.

Internal audit

The Group’s internal audit function is outsourced to BDO, who directly report to the Committee and were appointed in 2016.

The Committee continues to believe that the outsourcing model delivers enhanced benefits including the availability of a wider range
of skills and resources than an internal model could provide. Christian Bellairs, a senior partner at BDO, attends the Audit Committee
and the Executive Committee meetings as a standing attendee.

The Committee approves the internal audit plan at the start of the financial year. The plan for the year was created based on the key
risks identified by the Board as well as other key areas identified by the Executive Committee members. The plan was presented to the
Committee at the start of the financial year for approval and the Committee receives quarterly reports on all internal audits conducted
and progress against the plan. The plan is reviewed midway through the year to ensure it remains relevant and Committee members
are given the opportunity to change the scheduling or topics for consideration. All internal audit reports are available to the Committee
and Board.

The internal audit plan runs from January to December and the Committee will evaluate the effectiveness of the internal auditor
in January 2021. Ongoing assessments are made throughout the year.

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Strategic ReportGovernanceFinancial StatementsOther InformationAudit Committee Report continued

External auditor

The Audit Committee is responsible for developing, implementing and monitoring the Group’s policy on external audit. The policy sets
out the categories of any pre-approved non-audit services which the external auditor is authorised to undertake, all of which are closely
related to performance of the external audit. It also provides an approval process for the provision of any other non-audit services.
The External Auditor Independence Policy (previously the Audit and Non-Audit Services Policy) of the Group has been reviewed and
updated in the context of the latest Financial Reporting Council’s Ethical Standard 2019, the EU Directive (No.537/2014) and the 2018
UK Corporate Governance Code. This policy is available to view on the Investor Relations section of the Group’s website, under the
Board Committees subsection.

The Board generally only uses the external auditor for audit and related activities. If there is a business case to use the external auditor
to provide non-audit services, prior permission is required from the Committee. In such an instance, the Committee will review the
proposal to ensure that it will not impact the auditor’s objectivity and independence. An analysis of the auditor’s remuneration
is provided in note 8 to the Financial Statements.

The external auditor meets privately with the Committee at least twice a year without senior executive management being present and
regularly with the Audit Committee Chairman.

This year’s statutory audit is Robert Topley’s fifth, and final, year as the audit partner and also Deloitte’s final year as auditors.
Following an audit tender process, the Board approved the appointment of Ernst & Young (‘EY’) as external auditor with effect from
FY2021. EY attended Committee meetings throughout the year. Shareholders will vote on the resolution to appoint EY as external
auditor at the 2021 AGM.

The Committee confirms that the Group has complied with the Statutory Audit Services for Large Companies Market Investigation
(mandatory use of competitive tender processes and Audit Committee Responsibilities) Order 2014, which requires FTSE 350
companies to put their statutory audit services out to tender no less frequently than every ten years.

The Committee has considered the likelihood of the incumbent and proposed external auditor firms withdrawing from the market
and has noted that there are no contractual obligations to restrict the choice of replacement external auditor.

External auditor effectiveness

The Committee assesses the effectiveness of the external auditor on an annual basis, taking account of the following factors:

Factor

Assessment

The role of management

That information provided by management to the external auditor is timely and correct, that it has proper
supporting papers and that accounting systems and internal controls work effectively.

The audit partner

The extent to which the partner demonstrates a strong understanding of the business, the industry and the
challenges faced by the business. The length of time the partner acts as the lead engagement partner.

The audit team

The extent to which the audit team understands the business and industry and is properly resourced
and experienced.

The audit approach

That the audit approach is discussed with management, targets the significant issues early,
is communicated properly, is appropriate for the business and industry and includes an appropriate level
of materiality.

The communications
and formal reporting
by the auditor

That management and the Committee are kept appropriately informed as the audit progresses and that the
formal report is appropriate and contains all relevant material matters.

The independence and
objectivity of the auditor

That the auditor complies with the FRC’s ethical standards, has the required degree of objectivity
(including their arrangements to identify, report and manage any conflicts of interest), and that the overall
extent of non-audit services provided by the external auditor does not compromise independence.

The Committee is satisfied that Deloitte LLP had conducted an effective audit for the 2018/19 financial year. The Committee provided
feedback and this was taken into consideration when Deloitte conducted their final audit of the Group, FY2020.

Brewin Dolphin

Annual Report and Accounts 2020

Directors’ Remuneration Report

Aligning remuneration to best
practice and stakeholder interests

Impact of the COVID-19 pandemic

As discussed in more detail in other parts of the Annual Report,
Brewin Dolphin has performed well in FY2020, during a very
challenging economic environment since the start of the
COVID-19 pandemic in the second quarter of the financial year.
Total income increased by 6.6% to £361.4m, and adjusted PBT,
was £78.2m, an increase of 4.3%. Notwithstanding the COVID-19
restrictions, we have successfully adapted our operations to
continue to provide our range of services and achieve positive net
new business flows. We have not had to furlough any of our
colleagues and we have not received any government funding or
grants. The Board proposes a dividend that represents a payout
of 70% of adjusted diluted earnings per share, in line with the
dividend policy.

We have therefore been able to continue to incentivise employees
through our profit sharing plan. The Executive Directors’ annual
bonus plan and LTIP have continued to operate with performance
assessed according to the established criteria. Bonus and LTIP
outcomes for Executive Directors are, however, lower than in the
prior year.

Board changes

David Nicol stepped down as Chief Executive on 14 June 2020,
in preparation for his retirement on 29 July 2020, after eight years
with the Group. The treatment of his remuneration on retirement
follows our DRP requirements and his service agreement.
Further details are provided later in this report.

The Board was delighted to promote an internal candidate,
Robin Beer, to the role of Chief Executive Officer on
15 June 2020, to succeed David. Robin has been with Brewin
Dolphin for 12 years and, prior to becoming Chief Executive
Officer, led the Group’s intermediaries, charities, professional
services and digital businesses, as Managing Director of
Investment Solutions and Distribution. Robin’s remuneration
as Chief Executive Officer is in accordance with our DRP.
Further details on his base salary are provided below.

Caroline Taylor
Chairman of the Remuneration Committee

On behalf of the Remuneration Committee (the ‘Committee’) and
the Board, I am pleased to present the Directors’ Remuneration
Report (the ‘Report’) for the year ended 30 September 2020.
At the 2021 AGM, the Report will be submitted for the usual,
annual advisory vote. The Report for the year ended
30 September 2019 received overwhelming support at the
2020 AGM, with 97% of votes in favour.

Directors’ Remuneration Policy (the ‘DRP’)
approved at 2020 AGM

At the AGM held on 7 February 2020, the triennial binding vote
was held on the DRP. The Committee was pleased that the
proposed DRP was approved by shareholders with 89.5%
of votes in favour. This new DRP:

• Increased the Minimum Shareholding Requirement for all

Executive Directors to 200% of base salary;

• Introduced a Post-Employment Minimum Shareholding
Requirement to apply for two years post-cessation;

• Reduced the annual bonus pay-out for on-target performance

from two-thirds to 60% of maximum; and

• Increased the maximum LTIP grant to 150% of base salary

(note that the previous DRP already allowed grants of 150%
of salary, but in exceptional circumstances only).

Committee composition

The Committee comprises independent Non-Executive
Directors, and the Non-Executive Chairman of the Board,
who was independent upon his appointment in March 2013.
Caroline Taylor was appointed as Committee Chair on
1 October 2018. Caroline was a member of the Committee
for four years prior to being appointed as Chair. The other
Committee members are Simon Miller, Ian Dewar and Mike
Kellard (Simonetta Rigo resigned November 2020). There is
cross-membership with the Risk Committee to help ensure
alignment between the Group’s key risks and its remuneration
policy. The Chairman of the Risk Committee attends the

relevant Remuneration Committee meeting in order to advise
the Committee on risk and compliance factors when finalising
remuneration. The Chairman of the Remuneration Committee
also attends Risk Committee meetings, at least annually.
Further details of Remuneration Committee membership
and attendance can be found on pages 55 and 59.
The responsibilities of the Committee, which include
determining remuneration for all Material Risk Taker roles
and oversight of remuneration across the Group, are outlined
in the Committee’s Terms of Reference, a copy of which can
be found at brewin.co.uk/group/investor-relations.

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Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Base salary

The Committee reviewed base salaries effective 1 January 2020
and decided to increase the Chief Executive’s (David Nicol) base
salary by 2.3% to £445,000, and increase the Chief Financial
Officer’s base salary by 2.46% to £333,000. These percentage
increases were consistent with the average levels awarded
to other employees.

The Committee carefully considered the appropriate base salary
for Robin Beer for his promotion to the Chief Executive Officer
role in June 2020, taking account of the market benchmarks
and Robin’s remuneration in his previous role. The Committee
determined that the appropriate base salary for the role is
£500,000. This salary is at the lower quartile of FTSE 250
Chief Executive Officers and takes account of Brewin Dolphin’s
size and sector. It is also in the context of Brewin Dolphin’s
very conservative approach to Executive Director pension
allowances, which are set at the legal minimum (currently 3%
of qualifying earnings).

David Nicol’s base salary of £445,000 as Chief Executive was
anomalous; it was unusually low for legacy reasons – only 89%
of the FTSE 250 lower quartile – and therefore it did not provide
a suitable benchmark for Robin’s future salary.

Although the Committee determined that £500,000 is the
appropriate salary for the role, both parties agreed to apply
a restrained approach and to attain this in stages over 18 months,
in order to take account of Robin’s development in the role.
Therefore, on appointment on 15 June 2020, Robin Beer’s base
salary was set at £445,000. This will then increase in two equal
stages to £472,500 on 1 January 2021 and to £500,000 from
1 January 2022, subject to assessment of Robin’s development
in the role.

Pension

In contrast to market norms, Brewin Dolphin has, for many years,
operated a policy of either a zero pension or minimum statutory
pension only (3% of qualifying earnings), for its Executive
Directors, which is lower than the employer contribution for the
median employee. This approach has been applied both to the
new Chief Executive Officer and to the Chief Financial Officer.

Annual bonus outcome for 2020

As in previous years, annual bonus for FY2020 was weighted
60% on two financial metrics (adjusted profit before tax (PBT),
and net discretionary funds inflow) with equal weighting,
and 40% based on challenging operational, strategic and
personal objectives.

FY2020 adjusted PBT was £78.2m, and discretionary funds
net inflow was £0.9bn, an annualised growth rate (excluding
internal transfers) of 3.5%. This was a resilient performance
in exceptionally challenging market conditions.

An overall strong performance was achieved across a range
of challenging, non-financial performance criteria, detailed later
in this report.

As a result of both the financial and non-financial performance,
a total bonus of 72% of base salary was awarded, which is
14.4 percentage points lower than the prior year. This contrasts
with the profit share pool for other employees of the Group that
is approximately 4% down per capita on the prior year –
Executive Directors have experienced a greater fall in their
annual bonus than other employees of the Group.

A portion of the Executive Directors’ bonus for FY2020 has
been deferred into shares for three years, in line with the Policy,
to further enhance the alignment with shareholders.

Robin Beer’s annual bonus as Chief Executive Officer was
pro-rated based on his period in the role since his appointment
on 15 June 2020 and determined on the same criteria as the
previous Chief Executive.

LTIP granted in December 2017

The performance period for the 2017 LTIP ended on
30 September 2020. It was weighted 50% on compound annual
growth in adjusted EPS and 50% based on average discretionary
net funds inflow. The three-year EPS compound annual growth
has been 1.3% compared to a range of 5% to 15% between
threshold and maximum. Discretionary net funds inflow averaged
4.5% per annum, compared with a range of 2.5% to 7.5%
between threshold and maximum. The overall vesting level was
therefore 32.2% of the maximum, 29.6 percentage points lower
than the prior year. The vested shares, net of sales to settle
income tax on vesting, are subject to a two-year, post-vesting
holding period.

Discretion

The Committee carefully considered the potential bonus and
LTIP outcomes at the half year and at each subsequent meeting,
together with the final results, in light of the overall performance
of the business and the outcomes for its stakeholders. The
Committee determined that the bonus payment and LTIP vesting
outcomes are an accurate reflection of the overall performance
achieved including the economic impact of the COVID-19
pandemic on the business, and no discretion to override these
outcomes was necessary. Bonuses and LTIP vestings are lower
than the prior year; the executive team have delivered a robust
performance despite the challenges.

LTIP granted during FY2020

The Chief Executive (David Nicol) and Chief Financial Officer
(Siobhan Boylan) each received an LTIP grant of 150% of base
salary during the course of the FY2020. 50% of the award is
based on EPS growth and 50% is based on discretionary net
funds inflow. The performance period is the three financial years
ending 30 September 2022. A two-year post-vesting holding
period applies.

Brewin Dolphin

Annual Report and Accounts 2020

Annual bonus and LTIP grants for the next
performance periods

The Committee has carefully considered the performance
conditions for annual bonus and LTIP for the forthcoming periods,
in light of the current economic uncertainty associated with the
ongoing COVID-19 pandemic. The annual bonus performance
criteria for FY2021 will continue to be set using a weighting
of 60% financial performance and 40% on non-financial criteria.
Financial criteria will comprise adjusted PBT (20% weighting),
discretionary FUM net inflow (20% weighting) and Total Income
(20% weighting). The introduction of a Total Income metric to
the scorecard is aligned to the Group’s strategic goals of growing
revenues from a broadening range of distribution channels
and propositions.

LTIP awards will be granted during the course of FY2021.
The Committee has amended the LTIP rules to allow for
adjustment at or prior to vesting in FY2024 if the Committee
considers there has been an unjustified windfall gain resulting
from severely depressed market share prices at the time of grant.
The Committee’s assessment of whether an unjustified windfall
gain has arisen will take account of all the circumstances,
including the overall performance achieved by the Group,
the impact of the COVID-19 pandemic, and the movement in
stock market indices, on incentive plans and share awards.

The performance conditions for the grants to be made in
FY2021 will be adjusted EPS growth (33%), average growth in
discretionary FUM net inflows (33%), average annual total income
growth (33%). Total income growth has been included in the
metrics for this grant, to reflect our strategy of growing revenues
from a range of sources including non-FUM related channels.

Regulatory change

Brewin Dolphin is currently subject to the FCA’s IFPRU
Remuneration Code. This regulatory framework for remuneration
is likely to change with the implementation of the EU Investment
Firms Directive and the end of the transition period following the
UK’s exit from the EU. The Committee will be monitoring these
developments, and will consider any implications for our
remuneration policies and practices. The Committee will consult
with shareholders if any substantive changes are required to the
remuneration of Directors as a result of regulatory developments.

TSR performance

Brewin Dolphin’s long-run TSR performance relative to the wider
market has been strong. £100 invested in the Company at the
end of September 2010 was worth £272 at 30 September 2020,
compared to £163 if it had been invested in the FTSE All
Share Index.

Conclusion

I thank shareholders for voting in favour of our Directors’
Remuneration Policy and Remuneration Report at the last AGM.
I hope you find this year’s report informative, and that you will
continue to give the Committee your support.

Caroline Taylor
Chairman of the Remuneration Committee

24 November 2020

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

What the Committee has focused on during the year

Area

Action in the meeting

Result

Executive
Directors’
remuneration

Share
based awards

• Reviewed the Executive Directors’ salaries,

bonus and other awards

• Determined the terms of the service agreement

of incoming Chief Executive Officer
• Determined the terms of the retirement

arrangements for the outgoing Chief Executive

• Assessed and approved the 2017 LTIP vesting
• Approved the LTIP performance criteria and other

share-based incentive plan awards

• Reviewed LTIP share plan rules to bring in line with

the Directors’ Remuneration Policy

The approval of the service agreement and
retirement arrangements for the Executive
Directors, further information on page 99.

The performance metrics of the LTIP were
reviewed to ensure that they remained appropriate
and stretching.

The Committee was satisfied that it remained
an effective reward mechanism.

Updated LTIP rules which were approved at the
2020 AGM.

Governance

• Discussed the outcome of the Committee

performance evaluation report

Outcomes from the 2020 Committee evaluation
were discussed and an action plan agreed.

• Reviewed and updated the Terms of Reference

for the Committee

• Discussed the outcome of the AGM voting on the

Remuneration Policy

• Reviewed the effectiveness of external

Remuneration Advisors

Agreed to consult with shareholders who had
voted against the Policy and enhance the
consultation process.

Consulted with major shareholders and voting
agencies prior to finalising remuneration
arrangements for year end FY2020.

Transitioned advisors from Aon to
Alvarez & Marsal, see page 93.

Core compliance

• Assessed and approved annual bonus outcomes,
including deferral awards under the Deferred Profit
Share Plan

Ensured alignment of remuneration with
performance and regulatory requirements
by completion of all of the core processes.

• Reviewed the Directors’ Remuneration Report

for the Annual Report

• Reviewed the Group’s remuneration budget and

other employee incentives

• Identified and approved the individual compensation

for the Material Risk Takers (‘MRTs’)

• Reviewed the process and guidelines for annual
remuneration for the entire employee workforce

• Debated the impact of market volatility on the

minimum shareholding requirement and
post-employment shareholding requirement

Regulatory

• Received reports from the Chief Risk Officer

on conduct risk

• Approved the changes to the Remuneration

Policy Statement for submission to the FCA and
Pillar III disclosures

• Received updates on changes in regulation and

trends in remuneration. With a focus on the impact
of COVID-19 and Investment Firms Directive and
Investment Firms Regulation

• Discussed the results of the Gender Pay Gap Report

as well as diversity and inclusion initiatives

The Committee received an update from
the Chief Risk Officer on conduct risk for
Executive Directors, Executive Committee
members, the Company Secretary and MRTs.
The outcomes were then used to inform bonus
and profit share allocations.

Brewin Dolphin

Annual Report and Accounts 2020

Annual Report on Remuneration

This part of the Directors’ Remuneration Report has been prepared in accordance with Part 3 of the revised Schedule 8 set out in the
Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013, and 9.8.6 of the Listing
Rules. The financial information in this part of the Directors’ Remuneration Report has been audited where indicated.

Total remuneration for the financial year to 30 September 2020 (Audited)

£’000
Executive Directors
David Nicol10

Robin Beer9

Siobhan Boylan5

Non-Executive Chairman
Simon Miller

Non-Executive Directors
Kath Cates

Ian Dewar

Caroline Taylor

Mike Kellard6

Phillip Monks7

Simonetta Rigo8

Paul Wilson8

Total
Total

Salary
& fees Benefits1 Pension2

Annual
bonus3

Long-term

incentive4 Other5

Total
excluding
value in
‘Other’

Total fixed
remuneration

Total variable
remuneration

Total

311
432
131
–
329
187

200
180

77
83
87
77
77
70
62
60
39
–
62
60
2
60
1,377
1,029

1
1
–
–
1
1

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
2
2

–
–
–
–
1
1

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
1
1

227
376
93
–
240
162

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
560
538

–
301
52
–
–
–

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
52
301

–
–
–
–
–
730

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
730

–
–
–
–
-
351

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
351

539
1,110
276
–
571
1,081

200
180

77
83
87
77
77
70
62
60
39
–
62
60
2
60
1,992
2,781

312
433
131
–
331
189

200
180

77
83
87
77
77
70
62
60
39
–
62
60
2
60
1,380
1,212

227
677
145
–
240
892

–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
612
1,569

Year

2020
2019
2020
2019
2020
2019

2020
2019

2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019

1. Benefits relate to death-in-service insurance and private medical insurance. Executives can also elect to use part of their total fixed remuneration to fund

additional benefits. These amounts are disclosed as part of the ‘salary and fees’ figure.

2. Executives can elect to sacrifice part of their annual bonus into the Group’s defined contribution pension scheme. Where employees choose to do this,
the Group contributes 13.8% of the sacrificed amount, equal to the employer’s national insurance that would have been due had the amount been paid
as bonus. None of the Executive Directors opted to do this in FY2019 or FY2020.

3. This relates to the payment of the annual bonus which is subject to a mandatory deferral policy as set out on page 88.
4. The value of the long-term incentive is the value of shares for the award where the performance period ends in the year. 32.2% of the 2017 LTIP has vested
in the period. The figures for 2020 have been calculated using the average of the Group’s Q4 share price in the three-month period to 30 September 2020,
being £2.53 (rounded). The actual vesting date of the LTIP award is 13 December 2020. The figures presented for 2019 have been updated from the three-
month average figures used in last year’s report (being £282,318 for David Nicol based on a share price of £3.09 (rounded)) to take into account the Group’s
share price on the date of vesting, 1 December 2019, being £3.30 (rounded). The LTIP figure for 2019 in the table above includes the following: £19,259 for
David Nicol which is attributable to the movement in the share price between the grant date (1 December 2016) and the end of the performance period
(30 September 2019). This amounted to 6.15% of the vesting amount shown in the table. The LTIP figure for 2020 in the table above includes (£28,528)
for Robin Beer, which is attributable to the movement in the share price between the grant date, (13 December 2017) and the end of the performance period
(30 September 2020). This amounts to 1.84% of the vesting amount shown in the table.

5. Siobhan Boylan commenced her employment with the Group on 11 February 2019 and was appointed CFO and joined the Board on 4 March 2019, once

regulatory approval was received. The figures for 2019 in the table represent the amount of base salary and benefits, and annual bonus, earned for services
as a Board Director. £580,000 worth of shares were granted to Siobhan Boylan in 2019, to replace the share awards forfeited on leaving her previous employer.
These awards will vest over a four-year period from 2019 to 2022. She also received £150,000 in 2019, to replace the forfeited cash bonus from her previous
employer. This is included in the ‘Other’ column above.

6. In addition to the fees set out above which are in relation to his Brewin Dolphin Holdings PLC directorship, Mike Kellard receives an annual fee of €40,000

in relation to his position as a Non-Executive Director of Brewin Dolphin Wealth Management Limited (BDWM), the Group’s Irish subsidiary. He was appointed
to the Board of BDWM on 11 July 2019.

7. Phillip Monks was appointed to the Board on 10 February 2020.
8. Paul Wilson stepped down from the Board on 9 October 2019 and Simonetta Rigo stepped down from the Board on 13 November 2020.
9. Robin Beer was appointed to the Board on 15 June 2020. His salary is pro-rated from the date of appointment.
10. David Nicol stepped down from the Board on 14 June 2020. His salary and bonus are pro-rated until the date he ceased to be a Director. His 2017 LTIP

award vests on 13 December 2020, after he ceased to be a Director, so is not included in the table above.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Appointment of Robin Beer as the Chief Executive Officer (Audited)

Robin Beer was appointed as Chief Executive Officer and joined the Board on 15 June 2020. His remuneration package upon
appointment was as follows:

• Base salary £445,000. The base salary will increase to the agreed level of £500,000 over a period of 18 months as detailed in the

Committee Chairman’s introductory statement.

• Pension contribution of 3% of qualifying earnings (statutory minimum pension contribution).
• Annual bonus up to a maximum of 150% of base salary, subject to performance conditions, three-year deferral and time-proration

for the period worked during the year.

• Robin Beer received an LTIP award during the financial year ended 30 September 2019 in his previous position. He will be eligible
for LTIP awards of up to 150% of base salary for the financial year ended 30 September 2020 onwards, subject to performance
conditions measured over three years and a two-year post-vesting holding period (net of tax).

Payments to the former Chief Executive (Audited)

As we announced on 29 January 2020, David Nicol, Chief Executive, stepped down as a Director with effect from 14 June 2020.
In accordance with his service agreement and the DRP, David remained an employee for a transitionary period until 29 July 2020,
when his six-month notice period ended. He received his base salary and contractual benefits during this time.

He received an annual bonus of £226,950 in respect of his period as Chief Executive in the financial year ended 30 September 2020
which is a pro-rated amount taking account of the portion of the year he served as a Director and the performance achieved. In respect
of the period 15 June to 29 July 2020, whilst David Nicol continued as an employee and supported the transition to the new Chief
Executive Officer, he remained eligible for discretionary profit share, and was awarded £40,050 in respect of performance in this period,
according to the same performance criteria that applied to the Executive Directors. The awards are subject to the normal deferral rules.

David also retained the awards he received in relation to deferred annual bonuses earned in prior years, in accordance with the relevant
plan rules. He also retains the LTIP awards he held, pro-rated for time served, in accordance with the ‘Good Leaver’ treatment under
the plan rules. Both the DPSP and LTIP share awards will vest on the normal vesting dates. The LTIP awards are subject to the
applicable performance conditions. He received a contribution of £3,000 towards legal fees incurred in connection with his departure.

In accordance with the post-cessation shareholding policy, David will retain 200% of base salary in Brewin Dolphin shares, valued at the
date he stepped down from the Board, for 12 months from that date, reducing to 100% of base salary for the second 12 months
following this date. This is enforced through a written agreement.

Brewin Dolphin

Annual Report and Accounts 2020

Base salary review (Audited)

Salaries are normally reviewed in Q4, to take effect from 1 January each year. An increase of 2.30% (£10,000) was awarded
to the Chief Executive (David Nicol), and an increase of 2.46% (£8,000) was awarded to the Chief Financial Officer, effective from
1 January 2020. This was consistent with the levels of percentage increase awarded to our other employees.

Effective from 1 January 2021, the Chief Executive Officer’s (Robin Beer) salary will be increased to £472,500 (6% increase)
as explained in the Chairman’s introductory statement. The Chief Financial Officer did not receive a salary increase in line with
the year end review process.

David Nicol
Robin Beer
Siobhan Boylan

Salary as at
30 September

2019
£435,000
–
£325,000

Salary as at
30 September
2020
£445,000
£445,000
£333,000

Change
2.30%
–
2.46%

Annual variable pay outcomes for 2020

Annual bonuses for the Executive Directors are determined by the Committee based on an assessment of performance relative to
Key Performance Indicators (‘KPIs’), which are selected to achieve a direct relationship between progress towards the Group’s strategic
goals and the bonuses that are awarded. The maximum annual bonus for each individual Executive Director is 150% of base salary.
For the financial year ended 30 September 2020, the bonus award opportunity for on-target performance was 90% of base salary.
The Committee has the discretion to adjust the final outcome to take account of overall Group performance and exceptional events.

Overall outcome

Criteria
Financial
Non-financial
Total

Weighting
60%
40%

% of salary at
maximum
90%
60%
150%

% of maximum
total bonus
paid
16.2%
31.8%
48.0%

% of base
salary
24.3%
47.7%
72.0%

Performance for financial criteria

Key Performance Indicator
Adjusted1 PBT

Discretionary net funds
inflow2
Outcome

Weighting

Threshold
25% of
salary
30% £77.7m

On-target
90% of
salary
£84.0m

Maximum
150% of
salary
£90.3m

Actual for
year ending
30 September
2020
£78.2m

30%

2.5%

5.0%

7.5%

3.5%

% of salary
awarded for
this criterion Comment

9.0% Targets set in relation to prior
year performance and budget
15.3% Targets set in relation to prior
year performance and budget

24.3%

1. See explanation of adjusted performance measures on page 29.
2. Adjusted to exclude internal transfers.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther Information
Directors’ Remuneration Report continued

Performance for non-financial criteria

Team KPIs

Criteria and
weightings

Strategy
20%

Technology
20%

Key metrics/targets

Performance achieved

Rating
for each
criterion
(out of 5)

• Achieve significant PBT synergies,
realised from successful integration
of acquisitions.

• Successfully integrated 4 acquisitions and realised

£4m PBT of synergies.

• Three new ‘1762’ products (Lombard Lending,

• Develop new product offerings

under the ‘1762’ brand.

Absolute Return and Structured Product Portfolio)
have been designed, built, approved and rolled out.

• Deliver a replacement for the Client

• Delivered ‘Client Engage’ system, with strong

2.5

Management System.

governance and quality controls.

• Meet key milestones in the

Castle Programme.

• Develop digital offering for clients

via Wealthpilot.

• Design and deploy new Technology

Policy Framework (‘TPF’), and
strengthen infrastructure.

Clients
15%

• Maintain high client satisfaction

and Net Promoter Scores.
• Growth in MPS and BPS.
• New product development.

People,
Culture & ESG
15%

• Maintain high Employee
Engagement scores.

• High survey scores for Learning
and Leadership programmes.

• New programmes

successfully launched.

• Diversity, Inclusion and Well-being.
• Community involvement.
• Reduce carbon footprint.

4.5

• Castle – Product build milestone achieved on agreed
time frame. However, delays with integration phase
(now being addressed). Expected delivery date
delayed to 2021. See pages 18 to 21 of the
Chief Executive Officer’s Review.

• Developed, tested, launch planned. Also MyBrewin

App and website upgrade complete. Launched True
Potential Portal.

• TPF designed and deployed. Upgraded VPN

and migration to Microsoft Teams –
completed successfully.

• Overall client satisfaction with firm 8.7/10 and
satisfaction with primary contact 9/10. Client
satisfaction with outcomes 94.1%. Net promoter
score 51% compared to benchmark of 38%.
• MPS has grown by £0.5bn. BPS has grown

to 6,100 accounts.

• Multi-asset fund built. First steps in development
of Environment, Social and Governance (‘ESG’)
offering achieved, including hire of team.

• Employee Engagement Score increased to 90%
(from 87% last year), in annual People Survey,
13 points above Financial Services (‘FS’) benchmark.
• The survey question ‘I have the right opportunities to
learn and grow’ has risen year on year to 11% above
the FS benchmark.

• 2020 Emerging Talent; Investment Manager (‘IM’)

Academy; Future Wealth Manager;
Resilience programme.

• Improvement in Gender Pay Gap; Ranked 6th in

FTSE 250 in Hampton Alexander review. ‘Let’s Talk
About Race’ workshop – 274 participants so far.
Finalists in Reward and Employee Benefits
Association well-being strategy awards.
• Improvement in payroll giving participation;

maintained fund raising matching with 23 team
events raising over £66k. Introduced community
relief fund.

• Total Gross Scope 1 and 2 emissions reduced from

1,082 to 897 (tCO2e).

Risk
10%

• Senior Manager Certification

• SMCR Phase 1 completed and Phase 2 launched.

Regime (‘SMCR’).
• Risk Management.

Upgraded BITA risk system.

• New Group Risk Framework – Phase 1 delivered.

Brewin Dolphin

Annual Report and Accounts 2020

Personal KPIs

Individual

Key metrics/targets

Performance achieved

Rating
for each
criterion
(out of 5)

David Nicol
(Chief Executive
until 14 June
2020)
20%

• Leadership of key
strategic projects.

• Further enhance quality

of relationships with regulators
and shareholders.

• Development of the Group’s
brand externally, with clients
and contacts.

• Executive Committee development

and succession.

• Successfully led major projects across the Group,

4.25

with particular emphasis on key IT projects.

• Significant strengthening of relationships with both
regulators and shareholders – based on openness
and trust.

• Participated successfully in over 30 events with

clients and industry contacts.

• Succession plan in place, and coaching/training
implemented. Successful appointment of internal
candidate to Chief Executive Officer.

Robin Beer
(Chief Executive
Officer from
15 June 2020)
20%

• Leadership of key strategic

• Detailed examination of Castle Project,

4.25

projects- timely and on budget.

with improvements identified.

• Leadership through period of

• Strong leadership presence and communication.

change and COVID-19 impact.

• Further enhance quality

of relationships with regulators
and shareholders.

• Enhance Board and Executive

Committee interaction.

• Implementation of phase 1
of organisational design for
Executive Committee direct reports.

Brewin response to COVID-19 received 98% positive
endorsement in employee engagement survey.

• Enhanced planning for year-end meetings.

Successful participation in 41 meetings with
regulators and shareholders.

• Lead role in successful Strategy Day with Board.
• New Chief Operating Officer (‘COO’) appointed and

COO direct reports organisational design completed.
Restructure of the Client facing team reporting
directly to the Executive Committee, has been
successfully implemented.

Siobhan Boylan
(Chief Financial
Officer)
20%

• Further enhance Board presence

• Board feedback is good – exerts determined and

4.25

and influence.

expert influence.

• Further enhance financial oversight

• Enhanced collaboration with Project Management

of strategic projects.

Office, and financial oversight.

• Further build contribution

• Successful participation in 74 meetings over the year

to relationships with regulators,
shareholders and analysts.
• Continued improvement of

processes to drive cost efficiencies.

• Further develop interaction with
senior business heads and staff.

with regulators and shareholders. Appointment
of Head of IR.

• Successful implementation of Coupa expense
system, and continued challenge on costs.
• Introduced regular meeting cycles with senior
business heads; successfully implemented.

Across all of the non-financial KPIs, the weighted average rating out of 5 was 3.975, and this equated to a bonus of 47.7% of salary
after applying the weighing which is 40% on non-financial criteria.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Bonus outcomes (Audited)

Based on assessment of performance, the Committee has awarded the following annual bonuses to the Chief Executive Officer and the
Chief Financial Officer, with the split between cash and deferred shares as indicated in the table below. The Executive Directors receive
part of their annual variable pay under the Deferred Profit Share Plan (‘DPSP’) as a deferred award in Group shares, normally in the form
of a nil-cost option. The options vest and become exercisable three years from the date of grant.

Both the share and cash elements of the bonus are subject to malus and clawback provisions. Please see the Directors’ Remuneration
Policy table on page 95 for further details. The Committee has the discretion to adjust the final outcome to take account of overall
Group performance and exceptional events. After careful consideration, the Committee did not make any such adjustment for the
bonuses in respect of the financial year ended 30 September 2020.

Name
David Nicol2
Robin Beer2
Siobhan Boylan

Role
Chief Executive
Chief Executive Officer
Chief Financial Officer

Cash
£165,467
£66,894
£176,507

Deferred
shares1
£61,483
£26,556
£63,253

Total
£226,950
£93,450
£239,760

1. See deferral table below.
2. Robin Beer and David Nicol’s total bonus figures are pro-rated for the period in their respective roles during the year. The deferral percentages are calculated

based on their total bonuses including the bonus received for the periods they were not Executive Directors.

In accordance with the DRP, annual bonus awards are subject to deferral on the basis shown on the table below. This is designed
to increase the deferral percentage at high levels of bonus.

Portion of variable pay
Up to £50,000
Between £50,000 and 1 x salary
Above 1 x salary

Fraction deferred
None
One-third
Two-thirds

Vested LTIP outcome for the three-year performance period ended 30 September 2020 (Audited)

The Chief Executive Officer (Robin Beer) received a conditional share award granted under the LTIP in December 2017. The
performance period for the grant was the three years ended 30 September 2020 and the performance criteria set are shown below:

Criteria
Adjusted EPS Compound Annual Growth Rate (‘CAGR’)
Average annual discretionary net funds growth1
Blended pay out total

Weighting
50%
50%

Threshold
target
5.0%
2.5%

Full vesting
target
15.0%
7.5%

Actual performance
achieved
1.3%
4.5%

% of award to
vest
0%
32.2%
32.2%2

1. Average annual net inflows in discretionary funds expressed as a % of prior year discretionary funds. Between threshold and stretch, there is an additional

inflection point at 5% growth with 75% vesting on this metric. The growth is adjusted to exclude internal transfers.

2. No discretion was exercised to override the vesting outcome, as the outcome is a fair reflection of performance achieved.

Chief Executive Officer pay for performance comparison

The graph below shows the value by 30 September 2020 of £100 invested in Brewin Dolphin Holdings PLC in September 2010.
The other points plotted are the values at intervening financial year-ends. Brewin Dolphin’s TSR has been compared against the
FTSE All Share Index, which shows how the Group’s shares have performed relative to the market as a whole.

Total Shareholder Return

Source: FactSet

400

350

300

250

200

150

100

)

d
e
s
a
b
e
r
(
e
u
a
V

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

 Brewin Dolphin Holdings PLC

 FTSE All Share

Brewin Dolphin

Annual Report and Accounts 2020

The total remuneration figure for the director undertaking the role of Chief Executive Officer during each of the previous financial years
is shown below. The total remuneration figure includes the annual bonus which was awarded based on performance in those years.
Where this bonus was subject to deferral, the deferral amount is shown in the year in which it was awarded. The annual bonus is shown
as a percentage of the maximum for 2012 to 2019 only as there was no maximum amount for bonus in the preceding years.

Total remuneration (£’000)
Annual bonus (% max)
LTIP vesting (% of award)

2010
643
n/a
n/a

2011
593
n/a
n/a

2012
557
39
n/a

2013
577
63
n/a

2014
770
80
n/a

2015
702
67
n/a

Year ended 30 September

2018

2017

2016
2019
713 1,025 1,199 1,091
57.6
61.8

71.1
74.6

82.6
16.2

60
nil

DN1

RB1

Total

2020
539
48.0
–

2020
269
48.0
32.2

2020
808
48.0
32.2

1. The 2020 remuneration has been pro-rated between David Nicol and Robin Beer who was appointed Chief Executive Officer on 15 June 2020.

The movement in the remuneration of the Directors between the current and previous financial year compared to that for the average
UK Group employee is shown below. Executive Directors receive minimal benefits, other than those they purchase from their base
salary. As such, an analysis of the movement in benefits for the Directors and the average employee was not considered to be practical
or meaningful and has not been included in the below comparison.

Chief Executive Officer1
Salary
Bonus
Chief Financial Officer – Siobhan Boylan2
Salary
Bonus
Chairman – Simon Miller
Fees
Bonus
Non-Executive Directors
Kath Cates3
Fees
Bonus
Ian Dewar3
Fees
Bonus
Caroline Taylor4
Fees
Bonus
Mike Kellard
Fees
Bonus
Phillip Monks
Fees
Bonus
Simonetta Rigo
Fees
Bonus
Average per employee (£)
Salary
Bonus

2019
£’000

2020
£’000

432
376

187
162

180
–

83
–

77
–

70
–

60
–

–
–

60
–

54
31

442
320

329
240

200
–

77
–

87
–

77
–

62
–

39
–

62
–

57
28

% change

2.32%
(14.75)%

75.94%
48.00%

11.11%
n/a

(7.23)%
n/a

12.99%
n/a

10.00%
n/a

3.33%
n/a

n/a
n/a

3.33%
n/a

5.00%
(11.00%)

1. The salary and bonus for Chief Executive Officer for FY2020 is the sum of the salary and bonus received by each of David Nicol and Robin Beer for the respective

periods that they served as Chief Executive Officer.

2. Siobhan Boylan’s salary and bonus for FY2019 were pro-rated based on her period of service as a Director, circa 7 months.
3. Kath Cates was the Senior Independent Director until 26 July 2019 when Ian Dewar took over this responsibility.
4. Caroline Taylor is the Remuneration Committee Chairman. The fee for this role was increased from £10,000 to £15,000 effective 1 October 2019.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Chief Executive Officer pay ratio

Last year, in anticipation of the new regulations requiring companies to publish information on the ratio of the Chief Executive Officer’s
pay to that of other UK employees in the Company, we voluntarily published our Chief Executive Officer pay ratio. We have provided the
Chief Executive Officer’s pay ratio information below for the year ending September 2020, in comparison with the ratio for the prior year.

In accordance with the regulatory requirements, the table below sets out the ratio between the Chief Executive Officer’s total
remuneration and the median, 25th and 75th percentile of the total remuneration amongst our UK employees. Total remuneration
reflects all remuneration received by an individual in respect of the relevant year, including base salary, benefits, pension, annual bonus
awarded, and the value vested from any long-term incentive. As there was a change of Chief Executive Officer during the year, the ratio
reflects the pro-rata base salary, annual bonus, pension (where applicable) and benefits in respect of each incumbent for their respective
period of office during the year, together with non-prorated LTIP vesting to the incumbent Chief Executive Officer (Robin Beer) in respect
of company performance to 30 September 2020, which was granted prior to his appointment as Chief Executive Officer.

Out of the three alternative methods available under the regulations for calculating the ratio, we chose to use Option A. It is the most
precise way of identifying employees at P25, P50 (median) and P75, and is generally preferred under shareholder guidelines. Under this
approach we calculated total remuneration on a full-time equivalent basis for all of our UK employees and ranked these figures to arrive
at the median and the other percentiles.

Percentile
25th percentile
50th percentile
75th percentile

Total
Remuneration
20191
£31,930
£53,026
£100,934

Total
Remuneration
20202
£33,613
£55,678
£100,536

Ratio 20191
34:1
20:1
11:1

Ratio 20202
31:1
19:1
10:1

1. In last year’s Report, the final figures for employee variable pay were estimated (as the distribution of the pool was not finalised at the time of calculation), but this
did not have a significant impact on the ratio. The figures shown above for FY2019 have been ‘trued-up’ to reflect the final distribution of the variable pay pool.

2. The final figures for employee variable pay for FY2020 are estimated (as the distribution of the pool was not finalised at the time of calculation) but this is not

expected to have a significant impact on the ratio. Final figures will be updated in next year’s Report.

The table below provides further information on the base salary component within total remuneration.

Percentile
25th percentile
50th percentile
75th percentile

Salary 2019
£27,150
£41,478
£69,508

Ratio 2019
15:1
10:1
6:1

Salary 2020
£25,888
£41,025
£70,059

Ratio 2020
17:1
10:1
6:1

Our ratio for FY2020 of 19:1 to our median employee total remuneration, is significantly lower than the median of the ratios in other
FTSE 250 companies, which is 32:1 based on latest available data. The ratio is also lower than for FY2019, reflecting lower annual
bonus and LTIP vesting levels for the Chief Executive Officer role. This relatively low ratio is consistent with the pay, reward and
progression policies applicable to the company’s employees as a whole. All employees are eligible for incentives, salaries are based
on role size and market benchmarks, and there are similar benefits and lower levels of pension contribution for the Chief Executive
Officer compared to the median employee.

Our Chief Executive Officer’s total remuneration package is relatively low compared to other companies of our size, with below-market
median salary, limited pension benefit, and relatively low maximum variable pay to date. It is important to recognise that the ratio is likely
to fluctuate from year to year, especially as it is influenced by LTIP vesting value outcomes which vary with share price as well as
performance outcomes. It may also be affected by: changes made to the LTIP grant size in accordance with the policy approved by
shareholders in 2020, as these grant levels flow through to vesting; and, the effect of the higher base salary that will be applicable to the
newly appointed Chief Executive Officer, as detailed elsewhere in this report.

Gender Pay Gap

The Group seeks to create an inclusive workplace with a diverse workforce. The Committee monitors the Gender Pay Gap on a regular
basis, and there is a strategy in place to narrow the gap. The mean hourly pay gap improved between FY2018 and FY2019, with figures
of 36.7% and 33.0% respectively. Although these gaps are higher than the national average, they are similar to levels elsewhere in the
financial services sector. They reflect the profile of the workforce at different job levels, rather than differences in pay between men and
women in the same role. Further details are available on the Company’s website.

Brewin Dolphin

Annual Report and Accounts 2020

Directors’ share interests (Audited)

Outstanding share options and conditional share awards

The tables opposite set out details of Executive Directors’ outstanding share awards (which will vest in future years subject
to performance and/or continued service). The share price at 30 September 2020 was 233.5p.

Share options – Deferred Profit Share Plan (‘DPSP’)

David Nicol DPSP
DPSP
DPSP
DPSP

Scheme Grant date
1/12/16
30/11/17
29/11/18
28/11/19

Total

Robin Beer DPSP
DPSP
DPSP
DPSP

Scheme Grant date
1/12/16
30/11/17
29/11/18
28/11/19

Total

Exercise
price
0.00p
0.00p
0.00p
0.00p

Scheme Grant date

Exercise
price

DPSP

28/11/19

0.00p

Siobhan
Boylan
Total

Number of
shares at
1 October
2019
33,344
54,907
44,715
–
132,966

Number of
shares at
1 October
20193
25,516
27,501
34,678
–
87,695

Number of
shares at
1 October
2019

Granted
during
year1
–
–
–
31,482
31,482

Exercised
during
year
33,344
–
–
–
33,344

Granted
during
year1
–
–
–
30,434
30,434

Exercised
during
year
25,516
–
–
–
25,516

Lapsed
during
year
–
–
–
–
–

Granted
during
year1

Exercised
during
year

Lapsed
during
year

Number of
shares at

30 September
20201,2
–
54,907
44,715
31,482
131,104

Number of
shares at

30 September
20201
–
27,501
34,678
30,434
92,613

Number of
shares at

30 September
20201

Maturity/

vesting
date
1/12/19

End of
End of
exercise
performance
period
period
1/12/21
n/a
n/a 30/11/20 30/11/23
n/a 29/11/21 29/11/24
n/a 28/11/22 28/11/25

Maturity/

vesting
date
1/12/19

End of
End of
exercise
performance
period
period
1/12/21
n/a
n/a 30/11/20 30/11/23
n/a 29/11/21 29/11/24
n/a 28/11/22 28/11/25

End of
performance
period

Maturity/

vesting
date

End of
exercise
period

–
–

12,339
12,339

–
–

12,339
12,339

n/a 28/11/22 28/11/25

1. Options under the Deferred Profit Share Plan were granted, in respect of a portion of the annual bonus earned for performance in FY2019.
2. Or on date of retirement.
3. Or on date of appointment.

Conditional share awards – Long Term Performance Plan (‘LTIP’)

David Nicol

Total

Robin Beer

Total

Scheme4
LTIP1
LTIP
LTIP

Grant date
13/12/17
29/11/18
28/11/19

Scheme4
LTIP1
LTIP
LTIP

Grant date
13/12/17
29/11/18
28/11/19

Siobhan Boylan
Total

Scheme4
LTIP

Grant date
28/11/19

Number of
shares as at
1 October
2019
109,536
131,987
–
241,523

Number of
shares as at
1 October
2019
64,432
77,639
–
142,071

Number of
shares as at
1 October
20193
–
–

Granted
during
year2
–
–
189,130
189,130

Granted
during
year
–
–
72,463
72,463

Granted
during
year
141,304
141,304

Vested
during
year1
95,844
–
–
95,844

Vested
during
year1
64,432
–
–
64,432

Lapsed
during year
13,692
58,768
147,025
219,485

Lapsed
during year
–
–
–
–

Vested
during
year1
–
–

Lapsed
during year
–
–

Number of
shares at
30 September
20201
–
73,219
42,105
115,324

Number of
shares at
30 September
20201
–
77,639
72,463
150,102

Number of
shares at
30 September
20201
141,304
141,304

End of
performance
period
30/9/20
30/9/21
30/9/22

Vesting
date
13/12/20
29/11/21
28/11/22

End of
performance
period
30/9/20
30/9/21
30/9/22

Vesting
date
13/12/20
29/11/21
28/11/22

End of
performance
period
30/9/22

Vesting
date
28/11/22

1. Actual vesting date is 13 December 2020. Figures shown are the number of shares vested at the end of the three-year performance period, 30 September 2020.
2. The Chief Executive (David Nicol) and the Chief Financial Officer received awards under the LTIP with a face value of 150% of base salary. The awards
are subject to the performance conditions as set out in last year’s Remuneration Report. 25% of the awards vest for threshold performance and 100%
for stretch performance.
3. Or on date of appointment.
4. For LTIP performance conditions refer to page 88.

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Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Share Award Agreement (‘SAA’)

Siobhan Boylan

Total

Scheme
SAA
SAA
SAA
SAA

Grant date

29/3/19
29/3/19
29/3/19
29/3/19

Number of
shares at
1 October
2019
63,415
45,810
32,278
7,287
148,790

Granted

Vested

Lapsed

during year
–
–
–
–
–

during year
63,415
–
–
–
63,415

during year
–
–
–
–
–

Number of
shares at
30 September
20201
–
45,810
32,278
7,287
85,375

Vesting date
30/4/20
30/4/21
2/5/22
29/3/22

Share awards were granted to Siobhan Boylan during FY2019 to replace the share awards forfeited on leaving her previous employer.
These awards will vest from 2021 to 2022. Please see note 31 to the Financial Statements for more information.

Beneficial interests and Minimum Shareholding Requirement (‘MSR’)

To further align the interests of Executive Directors with shareholders, Executive Directors are required to build up a shareholding within
five years of appointment date (15 June 2020 for Robin Beer and 4 March 2019 for Siobhan Boylan). Under the DRP that was approved
by shareholders at the 2020 AGM, the current MSR for both Executive Directors is 200% of base salary. Executive Directors are also
required to maintain a shareholding for two years post-cessation, in accordance with the DRP. This is enforced through a written
agreement with the individuals.

Shares that count towards these requirements include shares owned outright by the Executive Director, the amount equal to the net
of tax value of unvested awards granted under the deferred bonus (DPSP), and under the Share Award Agreement for Siobhan Boylan,
as they are unfettered by performance criteria, and net of tax LTIP share awards that have vested and been retained.

Director
David Nicol1
Robin Beer4
Siobhan Boylan3
Simon Miller
Kath Cates
Ian Dewar
Caroline Taylor
Michael Kellard
Phillip Monks
Simonetta Rigo1
Paul Wilson1

Beneficially owned
30 September
2019
207,215
n/a
53,400
80,000
5,587
6,358
10,000
5,493
n/a
6,000
8,596

Outstanding DPSP
awards
131,104
92,613
12,339
–
–
–
–
–
–
–
–

Outstanding LTIP
awards
211,168
214,534
141,304
–
–
–
–
–
–
–
–

Outstanding
SAA
–
–
85,375
–
–
–
–
–
–
–
–

Beneficially Owned
at 30 September
20201
273,062
75,144
86,902
80,000
5,587
6,358
14,500
16,096
–
15,250
8,596

Percentage of
MSR2,5
179%
61%
97%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a

Beneficially Owned
at 20 November
2020
n/a
75,279
86,902
80,000
5,587
6,358
14,500
16,096
–
n/a
n/a

1. Holdings as at year end or date of appointment/resignation if relevant.
2. Includes 53% of outstanding DPSP options and 53% of the 2017 LTIP award which will vest at 32.2% on 13 December 2020 but met its performance criteria

on 30 September 2020. These are included on a net of tax basis.

3. Siobhan Boylan was appointed on 4 March 2019. Her shareholding includes shares awarded under the Share Award Agreement, on a net of tax basis,

which replaces the shares forfeited on leaving her former employer.

4. The increase of 135 shares was as a result of two monthly Share Incentive Plan purchases.
5. The percentage shown is based on the current MSR that apply.

Deferred bonus

The Executive Directors receive part of their annual variable pay under the DPSP as a deferred award in Company shares, normally in
the form of a nil-cost option. The option vests and becomes exercisable three years from the date of grant.

Share Incentive Plan (‘SIP’)

Employees may use funds from their gross salary up to a maximum of 10% of their gross salary in regular monthly payments
(being not less than £10 and not greater than £150) to acquire Ordinary Shares in the Group (‘Partnership Shares’). Partnership Shares
are acquired monthly. For every Partnership Share purchased, the employee receives one Matching Share up to a total value of £20.
These shares are held in an employee benefit trust (the ‘Trust’). Market purchase shares are used to satisfy all shares purchased under
the SIP and it is the intention of the Directors to continue this practice for the forthcoming financial year. Our participation rate as at
30 September 2020 is 57% and this compares favourably to market norms.

Dilution

By agreement with shareholders, the aggregate number of shares which may be issued at any date of grant, when aggregated with
shares issued or issuable pursuant to options or awards granted in the preceding 10 years under any employee share plan operated
by the Group, shall not exceed 10% of the issued share capital. Within this 10% limit, the aggregate number of shares which may be
issued under discretionary schemes targeted at executives and other key roles shall not exceed 5% of the issued share capital in any
10-year rolling period. The current cumulative dilution level over the 10-year period to 30 September 2020 is 1.49%.

Brewin Dolphin

Annual Report and Accounts 2020

Material contracts with Directors

There were no material contracts between the Group and the Directors, except for their contracts of employment or letters
of appointment. The Directors undertake transactions in shares in the ordinary course of the Group’s business for their own account.
The transactions are not material to the Group in the context of its operations.

Total pension entitlements

Executive Directors may opt to waive part of their salary and receive an equivalent defined pension contribution instead. They may also
receive part of their annual bonus in the form of pension contribution. Robin Beer and Siobhan Boylan receive the statutory minimum
contribution of 3% of their qualifying earnings. David Nicol has not made contributions to the scheme and does not receive any benefits
under the scheme.

Defined benefit pension scheme

Entry to the Group defined benefit pension scheme was withdrawn in 2004 for new employees.

Death-in-service benefits

Executive Directors are eligible for death-in-service benefit cover which is equal to six times their individual base salary.

Private Medical Insurance (‘PMI’)

Executive Directors are eligible for PMI cover at a rate of single cover. They may elect to add dependants to the policy at their own cost.

Group Income Protection (‘GIP’)

Executive Directors are eligible for GIP cover at the rate of 25% of their base salary. They may elect to increase this cover to 50%
of base salary at their own cost.

Relative importance of the spend on pay (Audited)

Staff costs
Dividends

2019
’000
£166,830
£48,394

2020
’000
£179,418
£42,234

Change
8%
(13%)

Staff costs – average salary per employee has increased by 5% and the average bonus per employee has reduced by 11% respectively,
however the overall staff costs number has increased due to increased head count and the impact of acquisitions (see page 90).

External advisers

The Remuneration Committee was advised by the Executive Compensation Practice of Aon plc until 14 June 2020 and appointed
Alvarez & Marsal from 15 June 2020. They are members of the Remuneration Consultants Group and abide by its code of conduct
which requires advice to be impartial and objective. Alvarez & Marsal has no other connections with the Group. The total fees paid
in respect of services provided by Aon and Alvarez & Marsal to the Committee during the year were £98,282.

External directorships

Details of external directorships held by the Executive Directors during the year and any fees that they received in respect of their
services are shown below:

Executive Director
David Nicol

Company
Hermes Property Unit Trust

Position
Chair of appointment committee

2019
£40,000

2020
£28,3331

1. David Nicol’s fees have been pro-rated for the period 1 October 2019 until 14 June 2020.

Statement of shareholder voting

The Directors’ Annual Report on Remuneration received the following votes from shareholders at the 2020 AGM:

Votes cast in favour
Votes cast against
Total votes cast
Abstentions

Remuneration
Policy
200,463,249
23,475,000
223,938,249
170,857

Annual Report on
Remuneration
89.5% 217,288,822
6,646,409
10.5%
223,935,231
173,875

%
97.0%
3.0%

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Strategic ReportGovernanceFinancial StatementsOther Information

Directors’ Remuneration Report continued

Fees for the Chairman and the Non-Executive Directors

As detailed in the Policy, the Group’s approach to setting Non-Executive Directors’ remuneration is with reference to the market levels
in similar-sized FTSE companies, levels of responsibility and time commitments.

The Non-Executive Directors’ fees were last reviewed during 2019. Effective 1 October 2019, the Board agreed to increase the
Non-Executive Directors’ base fee to £62,000 (the last increase was January 2017) and to set all the Committee chairs’ fees at £15,000
per annum. The Remuneration Committee agreed to increase the Chairman’s fee to £200,000 effective 1 October 2019. There were
no fee increases as at 1 October 2020.

Chairman
Base fee
Senior Independent Director
Committee chair

1 October 2019

£200,000

£62,000

£10,000

£15,000

1 October 2020
£200,000
£62,000
£10,000
£15,000

Change in fees
–
–
–
–

Performance targets for FY2021 annual bonus, and LTIP awards to be granted in FY2021

For FY2021, the annual bonus will be based on performance against a balanced scorecard comprising four key performance areas.

Key performance areas
Adjusted PBT
Discretionary funds net inflows
Total income
Non-financial targets

Weighting (each measured independently)
20%
20%
20%
40%

Targets for FY2021 annual bonus will be disclosed in next year’s Report.

The LTIP awards to be granted in FY2021 will be subject to three separate performance metrics shown below, each accounting for
one-third of the award. The targets have been set with reference to the internal medium-term plans. There is also a general underpin
that the Committee will assess the overall health of the business and whether prudent risk management has been applied and may
scale back the vesting level if it considers this to be appropriate.

LTIP performance metric
Adjusted EPS CAGR

Weighting
(each measured
independently)
33.3%

Threshold

(25% vesting)
2.5%

Stretch

(100% vesting)
10.0%

Average annual discretionary
net funds inflows
Average annual total
income growth

33.3%

2.0%

6.0%

Measurement period
CAGR measured over the three financial
years FY2021, FY2022 and FY2023, using
FY2020 as the base year.
Average over the three financial years
FY2021, FY2022 and FY2023.
Average over the three financial years
FY2021, FY2022 and FY2023.

The Committee has amended the LTIP rules to allow for adjustment at or prior to vesting in FY2024 if the Committee considers there
has been an unjustified windfall gain resulting from severely depressed market share prices at the time of grant. The Committee’s
assessment of whether an unjustified windfall gain has arisen will take account of all the circumstances, including the overall
performance achieved by the Group, the impact of the COVID-19 pandemic, and the movement in stock market indices, on incentive
plans and share awards.

Directors’ Remuneration Policy (the ‘Policy’)

This Policy describes the policies, principles and structures that provide the parameters for the Remuneration Committee’s
decision-making in executive remuneration. The current Policy was approved by the shareholders at the 2020 AGM and is applicable
to FY2020-2023. The Committee carried out a detailed review of the previous Policy during 2019, taking into account the 2018 UK
Corporate Governance Code and feedback received from shareholders and voting agencies.

Remuneration principles and objectives

The primary objectives of the Policy are:

• To attract, retain and motivate talented executives of the calibre required to manage the business successfully, whilst seeking to avoid

paying more than is necessary to meet this objective.

• To motivate and reward good performance.
• To meet relevant regulatory requirements, including the requirements of the FCA Remuneration Code so far as these apply

to the Group.

Brewin Dolphin

Annual Report and Accounts 2020

The main principles of the Policy are:

• To ensure that total remuneration is set at a level that is market competitive by benchmarking against relevant external comparators,

taking account of size, complexity and sector, and to ensure that the overall package takes account of market practice.

• To maintain appropriate proportions of fixed and performance-related pay, to help to drive performance over the short and longer

term, maintain a flexible cost base, and avoid creating incentives for excessive risk taking.

• To align incentive plans with the business strategy, prudent risk management and shareholder interests.
• To achieve consistency with the general remuneration philosophy applied to the Group’s employees as a whole.

Remuneration Policy for Executive Directors

Element

Fixed pay

Purpose and link
to short and
long-term strategy

Provides a level
of fixed remuneration
sufficient to recruit
and retain necessary
talent, and to permit
a zero variable pay
award should that
be appropriate.

Annual
variable pay
(Discretionary)

Rewards annual
Group and personal
performance, and,
through the use of
deferral into shares,
also aligns reward
with longer-term
performance.

Operation, performance measures and periods,
deferral and clawback

Executive Directors receive a base salary plus Private Medical
Insurance (PMI) at single cover. They are eligible to participate
in the Group Death in Service insurance, plus the Group Income
Protection (GIP) in line with other employees. In addition, they can
elect to purchase additional PMI and GIP benefits from net salary.
Executive Directors can choose to sacrifice salary into the Group’s
defined contribution pension scheme. The Company does not
provide any other pension allowance for contribution for the
Executive Directors other than the statutory auto-enrolment
minimum. The Company can reimburse Directors’ reasonable
business expenses (including tax thereon if applicable).
Individual levels of base salary are reviewed annually, with any
increases normally effective from 1 January, unless there are
exceptional reasons for an increase at another time of the year.
Any increases are generally targeted at around the general level
of salary inflation in the Group, but may vary from this for
exceptional reasons such as a change in the individual’s role or
responsibilities, or a need to bring an individual’s remuneration
to a market competitive level.

Performance measures, targets and weightings are reviewed
annually and set in line with the annual business plan. Actual
measures and weightings may change from year to year to reflect
the business priorities at that time.

Portion of annual bonus
Up to £50,000
Between £50,000 and 1 x fixed One-third remuneration
Above 1 x fixed remuneration

What fraction is deferred?
None

Two-thirds

The Committee has the discretion to override formulaic
bonus outcomes, where necessary, under both the financial
and non-financial performance metrics, to take account
of wider factors.
Malus and clawback provisions may apply in exceptional
situations, such as misstatement of performance, failure of risk
management, serious misconduct, serious reputational damage,
corporate failure resulting from executive actions or failure to act.

Maximum
opportunity

Base salary is
benchmarked
against
relevant peers,
and is targeted
to be not more
than the
approximate
median
of relevant
comparators.

The maximum
individual
award of
annual variable
pay is 150%
of base salary.
60% of
maximum
opportunity
may be
payable for
on-target
performance.

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Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Remuneration Policy for Executive Directors

Element

LTIP
(Discretionary)

Purpose and link
to short and
long-term strategy

Rewards
achievement
of long-term
performance
objectives.

Minimum
Shareholding
Requirement

To ensure alignment
of the long-term
interests of Executive
Directors and
shareholders.

Post-
employment
Shareholding
Requirement

To ensure alignment
of Executive
Directors
post-cessation and
shareholder interests.

Operation, performance measures and periods,
deferral and clawback

Executive Directors will be eligible to be considered each year
for a conditional award of shares, which will vest in one tranche,
normally no earlier than three years from the date of award.
Vesting will be subject to performance conditions and targets
set prior to each grant by the Committee. These performance
conditions will be related to financial performance and will be
aligned to the business strategy. For each performance metric
used, there will be a threshold level of performance at which no
more than 25% of the portion of the award relating to that KPI
will vest, and a stretch level of performance, at which 100%
of the portion of the award relating to that KPI will vest.
Executive Directors will be required to hold net of tax vested
shares for a period of two years following vesting.
The Committee has the discretion to override formulaic LTIP
vesting outcomes, where necessary, taking account of the
overall or underlying Company performance.
Malus and clawback provisions may apply in exceptional
situations, such as misstatement of performance, failure of risk
management, serious misconduct, serious reputational damage,
corporate failure resulting from executive actions or failure to act.

Executive Directors are required to build and maintain
a shareholding equivalent to 200% of base salary,
normally within five years of appointment.

Executive Directors are required to maintain a shareholding
of 200% of base salary (or the actual holding on departure,
if lower) for the first year post-cessation, and 100% of base
salary for the second year (or the actual holding on departure,
if lower).
The Committee has discretion to make adjustments
to the post-employment shareholding requirement
in exceptional circumstances.

Maximum
opportunity

The maximum
annual award
under the LTIP
is 150% of base
salary (in face
value of shares
at grant).

n/a

Brewin Dolphin

Annual Report and Accounts 2020

Remuneration Policy for Executive Directors

Assumption

Minimum

Target

Maximum

Fixed pay

Total fixed remuneration.

Annual bonus

No annual bonus payable.

On-target annual bonus of 90%
of base salary.

Maximum annual bonus
of 150% of base salary.

LTIP

Zero vesting – threshold
not achieved.

n/a

Full vesting (100% of award).

The scenario bar charts relating to the policy were included in the Report for FY2019, which is available in the Annual Report for FY2019
on the Company’s website.

Remuneration Committee discretion

The Committee will operate the incentive plans according to the rules of each respective plan, and consistent with normal market
practice and the Listing Rules, where relevant. The Committee has flexibility in a number of areas regarding the operation and
administration of these plans, subject to the plan rules, including (but not limited to) the following:

• Participants in the plans;
• Timing of awards, payments and vesting;
• The size of an award or a payment, or the level of vesting, taking account of the overall or underlying Company performance;
• The treatment of awards in the event of change of control or restructuring of the Group;
• Whether a Director is a good or bad leaver for incentive plan purposes and the extent of, and timing of, any vesting; and
• How and whether an award or performance condition may be adjusted in certain exceptional circumstances (for example, in the

event of extreme share price movement).

How the views of shareholders are taken into account

The Remuneration Committee compares the Policy with shareholder guidelines and takes account of shareholder voting.
The Remuneration Committee Chair consults with major investors ahead of any material changes to the Policy and, along with the
Company Secretary, is available to meet with institutional shareholders to discuss any of the policy-related disclosures or outcomes
contained in this Directors’ Remuneration Report. As a result of the COVID-19 pandemic, the Remuneration Committee Chair has
consulted with major investors in relation to FY2020 remuneration.

Details of votes cast for and against the resolution to approve last year’s Remuneration Report are provided on page 93.

Consideration of employment conditions elsewhere in the Group

A consistent remuneration philosophy for employees is applied at all levels and the aggregate rate of base salary increase for all
employees is one of the factors considered when determining increases in fixed pay for Directors. All employees are eligible for
discretionary performance-related annual bonuses and the principle of bonus deferral applies to employees whose bonuses exceed
certain thresholds. A formal employee consultation on remuneration is not operated; however, employees are able to provide direct
feedback on the Group’s remuneration policies to their managers or the Human Resources department and as part of an annual
employee engagement survey. The Group Human Resources Director is a standing attendee at Remuneration Committee meetings and
presents regular reports on people strategy, including the effectiveness of the Group’s remuneration policies and how they are viewed
by employees.

Caroline Taylor is the Non-Executive Director responsible for employee engagement and she reports her findings to the Board, page 62.

Fixed ratios between the total remuneration levels of different roles in the Group are not applied, as this would prevent us from recruiting
and retaining the necessary talent in a highly competitive employment market.

Benchmarking

The Remuneration Committee takes account of market benchmark data when setting total remuneration packages for
Executive Directors and comparisons are made with other FTSE listed companies of similar size and business profile to the Group.
Practices in the wealth management sector and other related sectors are also considered. Benchmark data is used as a reference
point, alongside other factors such as the individual’s role, experience and performance, rather than as a direct determinant
of pay levels.

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Remuneration Report continued

Differences in remuneration policy for Executive Directors compared to other employees

The approach to remuneration for the Executive Directors is generally consistent with that for employees across the Group as a whole.
However, there are some differences which the Remuneration Committee believes are necessary to reflect the different responsibilities
of employees across the Group, and the need to recruit, retain and motivate employees in a variety of roles. For example, below Executive
Director level, the portion of annual variable pay that is deferred is structured differently and is capped at one-third rather than the two-thirds
deferral that applies to Executive Directors. Awards of market purchased shares are made to selected individuals from time to time,
excluding Executive Directors, which vest subject to continued service, to recognise individuals’ value to the Group and to create further
alignment with shareholders.

External non-executive director positions

Executive Directors are permitted to serve as non-executive directors of other companies, as this can help to broaden the skills and experience
of the Director, provided there is no competition with the Group’s business activities and where these duties do not interfere with the individual’s
ability to perform their duties for the Group. The number of external directorships an Executive Director can hold is limited to two non-executive
directorships. Where an outside appointment is accepted in furtherance of the Group’s business, any fees received are remitted to the Group.
If the appointment is not connected to the Group’s business, the Executive Director is entitled to retain any fees received.

Approach to remuneration for new Executive Director appointments

The remuneration package for a new Executive Director is set in accordance with the terms and maximum levels of the Group’s approved
remuneration policy in force at the time of appointment. The Committee may also offer additional cash and/or share-based elements when
it considers these to be in the best interests of the Group and shareholders, for the purpose of replacing awards or potential foreseeable
earnings which are forgone by the individual on becoming an Executive Director. This includes the use of awards made under 9.4.2 of the
Listing Rules. In considering any such payments the Remuneration Committee would take account of the amount of remuneration forgone and
the nature, vesting dates and any performance requirements attached to the remuneration forgone. Shareholders will be informed of any such
payments and the rationale for these. For an internal appointment, any deferred pay element awarded in respect of the prior role may be
allowed to pay out according to its terms, adjusted as relevant to take into account the appointment. In addition, ongoing remuneration
obligations existing prior to appointment may be permitted to continue where this is considered to be in the best interests of the Group and
shareholders. For external and internal appointments, the Group may meet certain relocation expenses as appropriate.

Service contracts and loss of office payments

Service contracts normally continue until the Executive Director’s agreed retirement date or such other date as the parties agree. The service
contracts contain provision for early termination.

In summary, the contractual provisions are:

Provision

Detailed terms

Notice period

Six months.

Termination
payment in the
event of
termination by
the Company
without due
notice

Change of
control

Total fixed pay in respect of the unexpired period of contractual notice, in addition to any amounts to which
they are legally entitled. In certain cases the Committee may also consider a discretionary award of annual
variable pay, subject to performance, in respect of the portion of any financial year that the individual has been
working with the Group, although not for the period of any payment in lieu of notice or ‘garden leave’.

Same terms as above on termination.

The Group has power to enter into settlement agreements with executives and to pay compensation to settle potential legal claims.
Any outstanding share-based entitlements granted to an Executive Director under the Group’s LTIP or other share plans will be determined
based on the relevant plan rules. The default treatment is that any outstanding awards lapse on cessation of employment.

However, in certain prescribed circumstances, such as death, disability, redundancy, retirement or other circumstances at the discretion of the
Committee (taking into account the individual’s performance and the reasons for their departure), ‘good leaver’ status can be applied. In such
cases, the normal practice, unless there are exceptional circumstances, is for any LTIP awards held to be pro-rated for the period of the
performance period that has expired, and the performance conditions would continue to apply. Share awards under the DPSP will vest in full
on the original vesting schedule. An Executive Director’s service contract may be terminated without notice and without any further payment
or compensation, except for sums accrued up to the date of termination, on the occurrence of certain events such as gross misconduct.

Brewin Dolphin

Annual Report and Accounts 2020

Legacy arrangements

For the avoidance of doubt, the Directors’ Remuneration Policy includes authority for the Group to honour any commitments entered into
with current or former Directors that have been disclosed to shareholders in previous Remuneration Reports. Details of any payments
to former Directors will be set out in the implementation section of this report as they arise.

Policy for the Chairman and other Non-Executive Directors

Element

Chairman fee

Non-Executive
Director fees

Purpose and link to
strategy

Operation

To pay a market
competitive all-inclusive
fee that takes account of
the role and
responsibilities.

To pay a market
competitive basic fee,
and supplements for
significant additional
responsibilities such as
Committee
Chairmanships.

The Chairman is paid a single fee for all
his responsibilities. The level of the fee
is reviewed periodically by the
Committee, with reference to market
levels in comparably-sized FTSE
companies, without the Chairman
being present.

The Non-Executives are paid a basic
fee. There are also supplements for
Committee Chairmanships and the
Senior Independent Director. The fee
levels are reviewed periodically by the
Chairman and Executive Directors.

Maximum

The maximum aggregate fee for
Non-Executive Directors is as listed
in the Articles of Association. This is
subject to change periodically though
any increase in aggregate fee would be
subject to approval by shareholders.

As above.

Non-Executive Directors are engaged under letters of appointment; they do not have contracts of service and are not entitled to
compensation on early termination of their appointment. The Group can reimburse Non-Executive Directors’ reasonable business expenses
(including tax thereon if applicable).

Compliance with the FCA Remuneration Code

The Remuneration Committee regularly reviews its Remuneration Policy’s compliance with the principles of the Remuneration Code of the
UK financial services regulator, as applicable to the Group. The Remuneration Policy is designed to be consistent with the prudent
management of risk and the sustained long-term performance of the Group.

This Directors’ Remuneration Report, including both the Policy and Annual Remuneration Report, has been approved by the Board
of Directors.

Caroline Taylor
Chairman of the Remuneration Committee

24 November 2020

www.brewin.co.uk

Brewin Dolphin

Strategic ReportGovernanceFinancial StatementsOther InformationDirectors’ Report

Index to principal Directors’ Report and Listing Rule disclosures

Relevant information required to be disclosed in the Directors’ Report and as set out in Listing Rule 9.8.4 R (information to be included
in the Annual Report and Accounts) may be found in the following sections:

Information
Business Review
Principal Risks and Uncertainties
Disclosure information to auditor
Directors in office during the year
Dividend recommendation for the year
Directors’ Insurance
Corporate Social Responsibility
Greenhouse gas emissions
Risk management objectives and policies
Future developments of the Company
Employment policies and employee involvement
Non-financial information statement
Structure of share capital, including restrictions on the transfer
of securities, voting rights and significant shareholders
Rules governing the appointment of Directors
Powers of Directors
Rules governing changes to the Articles of Association
Shareholder waiver of dividends
Stakeholder engagement

Section in Annual Report
Strategic Report
Strategic Report
Directors’ Report
Corporate Governance Report
Chairman’s Statement
Directors’ Report
Strategic Report
Directors’ Report
Note 30 to the Financial Statements
Strategic Report
Strategic Report
Strategic Report

Directors’ Report
Corporate Governance Report
Corporate Governance Report
Directors’ Report
Note 27 to the Financial Statements
Corporate Governance Report

Pages
18-23
44-33
102
54-55
6
101
40-41
101-102
45
18-21
50-51
50-51

100
70-71
59
100
159
64

Relevant information related to Companies (Miscellaneous Reporting) Regulations 2018 may be found in the following sections:

• Stakeholder Engagement, Corporate Governance Report pages 64-65.
• Employee Engagement, Corporate Governance Report page 62.

The above information is incorporated by reference and together with the information on pages 100 to 102 forms the Directors’ Report
in accordance with section 415 of the Companies Act 2006.

Strategic Report

The Strategic Report is set out on pages 2 to 51 and was approved by the Board on 24 November 2020. It is signed on behalf of the
Board by Robin Beer, Chief Executive Officer.

Cautionary statement

The review of the business and its future development in the Annual Report has been prepared solely to provide additional information
to shareholders to assess the Group’s strategies and the potential for these strategies to succeed. It should not be relied on by any
other party for any other purpose. The review contains forward looking statements which are made by the Directors in good faith based
on information available to them up to the time of the approval of these reports and should be treated with caution due to inherent
uncertainties associated with such statements. The Directors, in preparing the Strategic Report, have complied with section 417 of the
Companies Act 2006.

Share capital

Details of the Company’s authorised and issued share capital, together with details of the movements therein, are set out in note 27
to the Financial Statements. This includes the rights and obligations attaching to shares and restrictions on the transfer of shares.

The Company has one class of Ordinary Shares which carry no right to fixed income. There are no specific restrictions on the size
of a holding nor on the transfer of shares, which are both governed by the general provisions of the Articles of Association and prevailing
legislation. The Directors are not aware of any agreements between holders of the Company’s shares that may result in restrictions
on the transfer of securities or on voting rights.

Employee share plans

Details of employee share plans are set out in note 31 to the Financial Statements. Under the rules of the Group’s Share Incentive Plan
(‘SIP’), shares are held in trust for participants by Equiniti Share Plan Trustees Limited (the ‘Trustee’). Voting rights are exercised by the
Trustee on receipt of a participant’s instructions; if no such instruction is received by the Trustee then no vote is registered. No person
has any special rights of control over the Company’s share capital and all issued shares are fully paid.

Articles of Association

The Articles of Association may be amended by special resolution of the shareholders.

100

Brewin Dolphin

Annual Report and Accounts 2020

Substantial shareholdings

As at 30 September 2020, the Company had received notifications in accordance with the FCA’s Disclosures and Transparency Rule
5.1.2 of the following interests of 3% or more in the voting rights of the Company.

Shareholder
Henderson Group PLC
FIL Investment International
Janus Henderson Group PLC
BlackRock, Inc.
Royal London Asset Management
Aberforth Partners
FIL Limited
J O Hambro Capital Management
Legal & General
Kames Capital

Annual General Meeting

Number of voting rights
14,426,962
12,477,394
Below 5%
Below 5%
15,142,075
15,105,178
14,092,698
13,847,348
8,563,901
8,756,747

% of voting rights
5.09%
5.00%
Below 5%
Below 5%
4.99%
4.98%
4.97%
4.89%
3.99%
3.08%

The AGM will be held on 5 February 2021. Further information can be found in Notice of Meeting.

Purchase of own shares

At the AGM on 7 February 2020, shareholders approved a resolution for the Company to make purchases of its own shares
to a maximum of 10% of its issued Ordinary Shares. This resolution remains valid until the conclusion of the next AGM in 2021.
The Directors had not used this authority at the date of this report.

Directors’ Insurance

The Group has in place a Directors and Officers Liability Insurance Policy which provides cover for the personal liability which the
Company’s directors and officers may face. This remains in force at the date of this report.

Employees

The average number of persons, including Directors, employed by the Group and their remuneration is set out in note 7 to the
Financial Statements. Other information about the Group’s employee engagement, diversity and inclusion policies is set out in the
Our People and Culture, and Corporate Social Responsibility Reports starting on page 40. The Group-wide gender diversity split
as at 30 September 2020 was 44% female and 56% male.

Internal control and risk management

The Directors confirm that they have carried out a robust assessment of the principal and emerging risks facing the Group, including
those that would threaten its business model, future performance, solvency or liquidity. The Board considers that the information it
receives enables it to review the effectiveness of the Group’s internal controls in accordance with the FRC’s Guidance on Risk
Management, Internal Control and Related Financial and Business Reporting. Areas where internal controls can be improved are
identified and appropriate actions agreed as part of our internal control systems. Senior management, the Board and the Audit
Committee regularly monitor progress towards completion of these actions. The Board considers that none of the identified areas
for improvement constitute a significant failing or weakness.

Greenhouse Gas Emissions (‘GHG’)

The Group recognises and strives to minimise its impact on the environment. As a financial services provider, our main environmental
focus is on our network of offices and employee travel.

Global Greenhouse Gas (‘GHG’) emissions data for the year ended 30 September 2020

Emissions from activities for which the company own or control – combustion
of fuel (Scope 1) : tCO2e
Emissions from activities for which the company own or control – operation
of facilities (Scope 1) : tCO2e
Emissions from purchase of electricity, heat, steam and cooling purchased
for own use (Scope 2, location based) : tCO2e
Total gross Scope 1 & Scope 2 emissions : tCO2e
Energy consumption used to calculate above emissions: kWh
Intensity ratio: tCO2e (gross Scope 1 + 2) / FTE
Emissions from Fuel and energy related activities (Scope 3 category 3) : tCO2e
Emissions from employee business travel for which the company does not
own or control (Scope 3 category 6) : tCO2e

Oct 2019-Sept 2020

Oct 2018-Sept 2019

UK and

offshore

Global
(exc UK and
offshore)

UK and
offshore

Global
(exc UK and
offshore)

224

–

345

–

673
897
3,730,672
0.40
255

25
36
118,547
0.38
4

737
1,082
4,291,208
0.54
279

17
31
113,414
0.76
4

362

–

525

–

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General methodology and additional information

The table above reports our annual GHG emissions from sources as required the Companies and Limited Liability Partnerships
Regulations 2018 which implements the government’s policy on Streamlined Energy Carbon Reporting. These sources fall within
our consolidated financial statements. We have included most of the emission sources that we have responsibility for but have omitted
some emission sources based on materiality and a lack of data. Details of the emissions which we have omitted are given in the
“Emission sources not reported” section below. The Scope 2 emissions calculations for purchased electricity follow the location-based
methodology of the GHG Protocol.

This is our seventh year of reporting as a quoted company. We have used Sphera-Cloud – Corporate Sustainability software to gather
energy use data (natural gas and electricity) as well as data on hydrofluorocarbons and Business Mileage data and have applied
emission factors from the 2019 update to DEFRA. For Brewin Dolphin’s international operations (i.e. Dublin), please note International
Energy Agency’s electricity emission factor is applied for Scope 2 and for all Scope 3 electricity emissions we have used the GaBi
system emission factor set. We have reported our operation in Jersey under UK.

Groupwide, we have consolidated our Sustainability Team and will be working on our Environmental Strategy. We completed our first
Carbon Disclosure Project response in Summer 2020 on 2018/2019.

Note that in this reporting year (2019/2020) no fugitive emissions, i.e. emissions from refrigerant losses, occurred as there have not
been any replacements of our Direct Expansion systems.

Emission sources not reported

This section of the report details the emission sources that we have not reported on and provides the reasons behind our decisions.

• Only some of the offices we operate directly make use of gas and we have included this in our emissions from combustion of fuel.
We do not have distinct data on heat/steam for our other offices as this is most likely embedded in the office service charges that
we pay. As a result, we have not currently reported on purchased heat or steam.

• Three small offices were not included in the review as they were deemed not to be material.

Data quality for electricity and gas consumption

Our data for electricity as well as gas consumptions comes from two main sources:

• Consumption bills from suppliers/reports from property agents, meter read evidence etc. (exact data); and
• Our approximations based on exact data (estimated data).

We have used estimated data in some cases because we were unable to get complete data for all our offices for the current reporting
period. The section below details the approach that we have taken to fill the gaps in consumption data.

• We identified that there were some offices that had incomplete electricity or gas consumption figures for certain months over the
current reporting period. In such situations, we chose the following approach to estimate the consumption data for the missing
months. We identified the month(s) in the dataset with electricity consumption, calculated the daily consumption figure and applied
this daily figure to the month(s) that had missing data.

• In some other cases, there were offices that we had no electricity and or gas consumption data for. In these situations, we used an
average consumption intensity per square foot across offices with reliable data in the current reporting period. We then used these
average annual “consumptions per square foot” intensities to estimate the annual electricity/gas consumption of the offices with no
electricity/gas consumption data, based on individual floor areas.

Energy efficiency action taken

Brewin Dolphin carried out an Energy Savings Opportunity Scheme (ESOS) assessment during Autumn 2019. We have begun
to implement actions identified from the work including:

• Replacement of T5 lights with LED lights across some floors of the Edinburgh office. The remainder of lights for this office are

scheduled to be replaced during Autumn 2020.

• Replacement of over 50% of the T5 lights with LED lights at our Newcastle office.

Disclosure of information to auditors

Each of the persons who is a Director at the date of approval of this Annual Report confirms that:

• so far as the Director is aware, there is no relevant audit information of which the Company’s auditor is unaware; and
• the Director has taken all steps that he/she ought to have taken as a Director in order to make himself/herself aware of any relevant

audit information and to establish that the Company’s auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

Independent auditor

A resolution to appoint Ernst & Young LLP (EY) as the Group’s new external auditor following completion of the audit tender undertaken
during the Group’s financial year ended 30 September 2019 will be proposed at the forthcoming AGM.

Approved for and on behalf of the Board.

Tiffany Brill
Company Secretary
Brewin Dolphin Holdings PLC
Company Number: 02685806

24 November 2020

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Annual Report and Accounts 2020

Statement of Directors’ Responsibility

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

Company law requires the Directors to prepare such financial statements for each financial year. Under that law the Directors are
required to prepare the Group Financial Statements in accordance with International Financial Reporting Standards (‘IFRSs’) as adopted
by the European Union and Article 4 of the IAS and have also chosen to prepare the parent company Financial Statements under IFRSs
adopted by the EU. Under company law the Directors must not approve the Financial Statements unless they are satisfied that they give
a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

In preparing the Parent Company Financial Statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue

in business.

In preparing the Group Financial Statements, International Accounting Standard 1 requires that Directors:

• properly select and apply accounting policies;
• present information, including accounting policies, in a manner that provides relevant, reliable, comparable and

understandable information;

• provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand

the impact of particular transactions, other events and conditions on the entity’s financial position and financial performance; and

• make an assessment of the Company’s ability to continue as a going concern.

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

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s
website. Legislation in the United Kingdom governing the preparation and dissemination of Financial Statements may differ from
legislation in other jurisdictions.

Directors’ responsibility statement

We confirm that to the best of our knowledge:

• the Financial Statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken
as a whole;

• the Strategic Report includes a fair review of the development and performance of the business and the position of the Company and
the undertakings included in the consolidation taken as a whole, together with a description of the Principal Risks and Uncertainties
that they face; and

• the Annual Report and Financial Statements, taken as a whole, are fair, balanced and understandable and provide the information

necessary for shareholders to assess the Company’s position and performance, business model and strategy.

This responsibility statement was approved by the Board of Directors on 24 November 2020 and is signed on its behalf by

Robin Beer
Chief Executive Officer

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Report on the audit of the financial statements

1. Opinion

In our opinion:

• the financial statements of Brewin Dolphin Holdings plc (the ‘parent company’) and its subsidiaries (the ‘group’) give a true

and fair view of the state of the group’s and of the parent company’s affairs as at 30 September 2020 and of the group’s profit
for the year then ended;

• the group financial statements have been properly prepared in accordance with International Financial Reporting Standards

(IFRSs) as adopted by the European Union;

• the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European

Union and as applied in accordance with the provisions of the Companies Act 2006; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards

the group financial statements, Article 4 of the IAS Regulation.

We have audited the financial statements which comprise:

• the consolidated income statement;
• the consolidated statement of comprehensive income;
• the consolidated and parent company balance sheets;
• the consolidated and parent company statements of changes in equity;
• the consolidated and parent company cash flow statements; and
• the related notes 1 to 38.

The financial reporting framework that has been applied in the preparation of the group financial statements is applicable law and IFRSs
as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with the
provisions of the Companies Act 2006.

2. Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report.

We are independent of the group and the parent company in accordance with the ethical requirements that are relevant to our audit
of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. The non-audit services
provided to the group and parent company for the year are disclosed in note 8 to the financial statements. We confirm that the
non-audit services prohibited by the FRC’s Ethical Standard were not provided to the group or the parent company.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

3. Summary of our audit approach

Key audit matters

The key audit matters that we identified in the current year were:

• Revenue recognition;
• Impairment of goodwill and client relationships;
• Assumptions underlying the calculation of the pension scheme liability; and
• Acquisition accounting for Investec Capital and Investments (Ireland) Limited (“ICIIL”).

These matters are consistent with the prior year, with the exception of the acquisition accounting
for ICIIL which is a new key audit matter.

Materiality

Scoping

The materiality that we used for the group financial statements was £3.1m which was determined
on the basis of 5% of profit before tax from continuing operations.

The scope of our audit covered substantially the entire group, with the following entities in scope,
in addition to the parent company:

• Brewin Dolphin Limited;
• Brewin Dolphin Wealth Management Limited; and
• Brewin Dolphin MP Limited.

Significant changes
in our approach

There have been no significant changes in our audit approach in 2020, aside from the inclusion of
acquisition accounting as new a key audit matter following the acquisition of Investec Capital and
Investments (Ireland) Limited (“ICIIL”) by Brewin Dolphin Wealth Management Limited in the period.

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4. Conclusions relating to going concern, principal risks and viability statement

Going concern is the basis
of preparation of the financial
statements that assumes an
entity will remain in operation for
a period of at least 12 months
from the date of approval of the
financial statements.

We confirm that we have nothing
material to report, add or
draw attention to in respect
of these matters.

Viability means the ability of the
group to continue over the time
horizon considered appropriate
by the directors.

We confirm that we have nothing
material to report, add or
draw attention to in respect
of these matters.

4.1. Going concern

We have reviewed the directors’ statement in note 3b(ii) to the financial statements about
whether they considered it appropriate to adopt the going concern basis of accounting
in preparing them and their identification of any material uncertainties to the group’s and
company’s ability to continue to do so over a period of at least twelve months from the date
of approval of the financial statements.

We considered as part of our risk assessment the nature of the group, its business model
and related risks including where relevant the impact of the Covid-19 pandemic and Brexit,
the requirements of the applicable financial reporting framework and the system of internal
control. We evaluated the directors’ assessment of the group’s ability to continue as a going
concern, including challenging the underlying data and key assumptions used to make the
assessment, and evaluated the directors’ plans for future actions in relation to their going
concern assessment.

We are required to state whether we have anything material to add or draw attention
to in relation to that statement required by Listing Rule 9.8.6R(3) and report if the statement
is materially inconsistent with our knowledge obtained in the audit.

4.2. Principal risks and viability statement

Based solely on reading the directors’ statements and considering whether they were
consistent with the knowledge we obtained in the course of the audit, including the knowledge
obtained in the evaluation of the directors’ assessment of the group’s and the company’s
ability to continue as a going concern, we are required to state whether we have anything
material to add or draw attention to in relation to:

• the disclosures on page 44 that describe the principal risks, procedures to identify emerging

risks, and an explanation of how these are being managed or mitigated;

• the directors’ confirmation on page 46 that they have carried out a robust assessment of the

principal and emerging risks facing the group, including those that would threaten its
business model, future performance, solvency or liquidity; or

• the directors’ explanation on page 49 as to how they have assessed the prospects of the

group, over what period they have done so and why they consider that period to be
appropriate, and their statement as to whether they have a reasonable expectation that the
group will be able to continue in operation and meet its liabilities as they fall due over the
period of their assessment, including any related disclosures drawing attention to any
necessary qualifications or assumptions.

We are also required to report whether the directors’ statement relating to the prospects of the
group required by Listing Rule 9.8.6R(3) is materially inconsistent with our knowledge obtained
in the audit.

5. Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud)
that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources
in the audit; and directing the efforts of the audit team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

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5.1. Revenue recognition

Key audit matter
description

As detailed in the summary of significant accounting policies in note 3 and note 5, revenue comprises investment
management fees of £247.2m (2019: £232.2m), commissions of £77.8m (2019: £66.7m) and other income
of £36.5m (2019: £40.2m).

Investment management fees account for approximately 68% of total revenue and are based on a percentage
of individual clients’ funds under management. There is a risk that incorrect rates or fund valuations are used to
calculate management fees. This risk increases where amendments are required to be made to system calculated
fees due to the requirement for manual intervention. As a result, we consider there to be increased risk due to
fraud or error.

How the scope
of our audit
responded to the
key audit matter

We obtained an understanding of and tested the relevant controls over the calculation of management fees.
This included controls over system generated investment management fees, including associated IT controls and
controls over amendments to client fees.

We selected a sample of quarterly investment management fee calculations for individual clients and recalculated
the system generated amount. For a sample of fees, we agreed the rates used to client contracts and the value
of funds under management to third party sources and challenged the rationale and authorisation of any
amendments to the system generated fee. We reviewed client communications, new accounts and transfers for
a sample of clients to challenge the completeness of manual fee amendments.

Key observations Through our testing, we concluded that investment management fees were appropriately stated for the year

ended 30 September 2020.

5.2. Impairment of goodwill and client relationships

Key audit matter
description

Historically, the group has expanded through acquisitions leading to the recognition of goodwill and client
relationships of £128.1m (2019: £103.2m).

As detailed in the Audit Committee Report on page 76 and in the summary of significant accounting policies
in note 3 and note 13 intangible assets, client relationships are reviewed for indicators of impairment at each
reporting date in accordance with IAS 36 and, if an indicator of impairment exists, an impairment test is
performed. Goodwill is tested for impairment at least annually, whether or not indicators of impairment exist.

The impairment test requires an estimation of the recoverable amount for each of the group’s cash-generating
units (“CGUs”) and where the carrying amount exceeds the recoverable amount an impairment should be
recorded. Where the carrying value exceeds the recoverable amount, an impairment should be recorded.
The recoverable amount is the higher of its fair value less costs to sell (“FVLCTS”) and its value in use (“VIU”).

Management has historically estimated the recoverable amount of CGUs by calculating the FVLCTS using
a multiple of funds under management by reference to recent market transactions. Due to the economic
uncertainty caused by the COVID-19 pandemic, it was difficult to estimate a reliable fair value and, therefore,
management’s impairment test also used a VIU methodology based on discounting expected future cash flows.
The assumptions used, including the discount rate and the revenue assumptions in the cash flow forecasts,
are inherently judgemental and, as a result, we consider there to be an increased risk due to fraud or error.

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5.2. Impairment of goodwill and client relationships continued

How the scope
of our audit
responded to the
key audit matter

We obtained an understanding of relevant controls over the completeness and accuracy of the production
of funds under management data. We also obtained an understanding of the relevant controls over the
impairment test performed by management.

In assessing management’s impairment assessment for intangible assets, we have reviewed their methodology
for compliance with the requirements of IAS 36 “Impairment of Assets” and challenged the assumptions and
judgements made.

We performed the following procedures to challenge the key assumptions used in the VIU impairment
assessment:

• Supported by our valuation specialists, we challenged management’s discount rate by comparing it to our

independently derived range;

• Focusing on those assumptions where the impairment test was most sensitive, we challenged management’s
assumptions used to forecast the cash flows of the group’s CGUs by reference to recent trading performance,
taking into account the impact of Covid-19 and the Group’s strategy;

• We compared management’s actual results to previous forecasts to assess their historical forecasting accuracy;

and

• Supported by our valuation specialists, we challenged the long term growth rate used by comparison to third

party benchmarks.

Additionally we sample tested the completeness and accuracy of funds under management by CGU and
challenged the percentages management applied to market values of funds under management to determine the
FVLCTS of each CGU. We validated these against percentages derived from recent public acquisitions of fund
management businesses and the calculated the sensitivity of the impairment assessment to changes in the
percentages applied.

Key observations Through our testing, we concurred with management’s assessment that no impairments were required

to goodwill or client relationships.

5.3. Assumptions underlying the calculation of the pension scheme liability

Key audit matter
description

The group has recognised a defined benefit pension surplus of £20.3m (2019: £17.3m surplus). The net surplus
comprises assets of £126.1m and liabilities of £105.6m.

The calculation of the liability is sensitive to changes in underlying assumptions and is considered to be a key
source of estimation uncertainty for the group as detailed in note 4, disclosed in note 18 and on page 76 of the
Audit Committee report.

The key assumptions are the discount rate, inflation rate and mortality rate where small changes to these
assumptions could result in a material change to the pension liability valuation.

How the scope
of our audit
responded to the
key audit matter

In order to evaluate the appropriateness of the assumptions used by management, we performed the following
procedures:

• obtained an understanding of the relevant controls over the review of assumptions;
• Used our own actuarial experts to make direct enquiries of the group’s actuary to challenge the key actuarial

assumptions adopted in the IAS 19 (“Employee Benefits”) pension valuation; and

• Compared the discount rate, inflation rate and mortality assumptions to our independently determined

benchmarks derived using market and other data.

Key observations Through the work performed, we concluded that the assumptions underlying the pension scheme liability for the

year ended 30 September 2020 were within our independently determined range.

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5.4. Acquisition accounting for Investec Capital and Investments (Ireland) Limited (“ICIIL”).

Key audit matter
description

As set out in note 35a, during the period Brewin Dolphin Wealth Management Limited acquired 100% of Investec
Capital and Investments (Ireland) Limited (“ICIIL”). The acquisition was accounted for as a business combination,
under IFRS 3. The difference between the fair value of consideration of £43.4m and the fair value of net assets
acquired of £41.3m including client relationships intangibles of £32.1m, was recognised as goodwill of £2.0m.

As explained on page 76 in the Audit Committee report and in note 4, the determination of the fair value of net
assets acquired including the valuation of client relationships intangibles and goodwill requires judgement and the
use of assumptions such as revenue assumptions in the cash flow forecasts.

How the scope
of our audit
responded to the
key audit matter

We performed an independent assessment of the acquisition accounting to assess whether it is in compliance
with IFRS 3, which included the following:

We independently determined the acquisition date, resulting measurement period and the consideration paid,
including deferred consideration.

We evaluated management’s identification and assessment of the separately identifiable assets acquired,
including any fair value adjustments required.

We challenged the cash flow forecasts used to estimate the fair value of client relationship intangibles.

We challenged the split of goodwill and client relationships by benchmarking to other acquisitions in the industry
and evaluating management’s approach to determining the fair value of the client intangibles.

We tested the mathematical accuracy of the calculations performed by management to determine the amounts
of client relationship intangibles and goodwill recognised.

Key observations Through our testing, we concurred with management’s accounting of the ICIIL acquisition in the period and the

valuation of the intangibles and goodwill arising from the acquisition.

6. Our application of materiality

6.1. Materiality

We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions
of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work
and in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Group financial statements

Parent company financial statements

Materiality

£3.1m (2019: £3.1m)

£2.6m (2019: £2.6m)

Basis for
determining
materiality

5% of profit before tax which is consistent with our
approach for the prior year audit.

We determined materiality based on 1% of net assets
which is consistent with our approach for the prior
year audit.

Rationale for
the benchmark
applied

Profit before tax was used as the basis for determining
materiality as this is the key metric used by members of
the parent company and other relevant stakeholders in
assessing financial performance.

The parent company primarily holds the investments
in group entities and, therefore, net assets is
considered to be the key focus for users of the
financial statements.

6.2. Performance materiality

We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected
misstatements exceed the materiality for the financial statements as a whole. Group performance materiality was set at 70% of group
materiality for the 2020 audit (2019: 70%). In determining performance materiality, we considered the following factors:

• our risk assessment, including our assessment of the group’s overall control environment and that we consider it appropriate to take

a controls reliance approach over a number of business processes; and

• our past experience of the audit, which has indicated a low number of corrected and uncorrected misstatements identified

in prior periods

6.3. Error reporting threshold

We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of 5% of materiality,
£155,000 (2019: £156,000), as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.
We also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the
financial statements.

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7. An overview of the scope of our audit

7.1. Identification and scoping of components

The group consists of the main trading subsidiary, Brewin Dolphin Limited along with Brewin Dolphin Wealth Management Limited,
Brewin Dolphin MP Limited, BDDL Limited, Aylwin Limited and Mathieson Consulting Limited. Consistent with the prior year we focused
our group audit scope primarily on Brewin Dolphin Limited which was subject to a full audit, and Brewin Dolphin Wealth Management
Limited and Brewin Dolphin MP Limited, which were subject to an audit of specified account balances.

Our full scope audits and audits of specified balances covered 99% (2019: 99%) of the group’s revenue and profit before tax. Our audit
of Brewin Dolphin Limited used a component materiality of £2.9m (2019: £3.1m).

7.2. Our consideration of the control environment

Our group audit was scoped by obtaining an understanding of the group and its control environment and assessing the risks of material
misstatement in the group’s financial statements.

Based on our understanding of the group’s control environment, we elected to test controls, including the involvement of IT specialist
to assess the associated IT controls, in the following areas:

• Discretionary investment management fee income;
• Investment management commission income;
• Execution only fee income;
• Other operating costs; and
• Trade debtors and creditors.

7.3. Working with other auditors

The majority of the operations of the group are based in the United Kingdom and are audited by the group engagement team. The only
exception to this is Brewin Dolphin Wealth Management Limited, an Irish company, which represents approximately 6.5% (2019: 3.1%)
of revenue and is audited by another Deloitte member firm which is consistent with the prior year.

Where processes relevant to the group audit are performed centrally in the United Kingdom these have been audited by the group
engagement team.

8. Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report
other than the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit
or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report that fact.

In this context, matters that we are specifically required to report to you as uncorrected material misstatements of the other information
include where we conclude that:

• Fair, balanced and understandable – the statement given by the directors that they consider the annual report and financial

statements taken as a whole is fair, balanced and understandable and provides the information necessary for shareholders to assess
the group’s position and performance, business model and strategy, is materially inconsistent with our knowledge obtained in the
audit; or

• Audit Committee reporting – the section describing the work of the Audit Committee does not appropriately address matters

communicated by us to the Audit Committee; or

• Directors’ statement of compliance with the UK Corporate Governance Code – the parts of the directors’ statement required

under the Listing Rules relating to the company’s compliance with the UK Corporate Governance Code containing provisions
specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) do not properly disclose a departure from a relevant
provision of the UK Corporate Governance Code.

We have nothing to report in respect of these matters.

9. Responsibilities of directors

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

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Strategic ReportGovernanceFinancial StatementsOther InformationIndependent Auditor’s Report continued

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

10. Auditor’s responsibilities for the audit of the financial statements

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws
and regulations are set out below.

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

11. Extent to which the audit was considered capable of detecting irregularities, including fraud

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design
and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide
a basis for our opinion.

11.1. Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and
regulations, we considered the following:

• the nature of the industry and sector, control environment and business performance including the design of the group’s

remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;

• results of our enquiries of management, internal audit and the Audit Committee about their own identification and assessment of the

risks of irregularities;

• any matters we identified having obtained and reviewed the group’s documentation of their policies and procedures relating to:

• identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
• detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
• the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

• the matters discussed among the audit engagement team and involving relevant internal specialists, including tax, valuations,

pensions and IT, for regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and
identified the greatest potential for fraud in the following areas: revenue recognition and the impairment of goodwill and client
relationships. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk
of management override.

We also obtained an understanding of the legal and regulatory frameworks that the group operates in, focusing on provisions of those
laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements.
The key laws and regulations we considered in this context included the UK Companies Act, Listing Rules, pensions legislation and
tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but
compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty. These included the group’s
regulatory requirements under the rules of the Financial Conduct Authority.

11.2. Audit response to risks identified

As a result of performing the above, we identified revenue recognition and Impairment of goodwill and client relationships as key audit
matters related to the potential risk of fraud. The key audit matters section of our report explains the matters in more detail and also
describes the specific procedures we performed in response to those key audit matters.

In addition to the above, our procedures to respond to risks identified included the following:

• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions

of relevant laws and regulations described as having a direct effect on the financial statements;

• enquiring of management, the Audit Committee and in-house and external legal counsel concerning actual and potential litigation

and claims;

• enquiring of management and the Audit Committee concerning instances of actual and suspected non-compliance with regulation;
• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement

due to fraud;

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• reading minutes of meetings of those charged with governance, reviewing internal audit reports and reviewing correspondence with

HMRC and the Financial Conduct Authority; and

• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other
adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and
evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

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

Report on other legal and regulatory requirements

12. Opinions on other matters prescribed by the Companies Act 2006

In our opinion the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the
Companies Act 2006.

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

• the information given in the strategic report and the directors’ report for the financial year for which the financial statements are

prepared is consistent with the financial statements; and

• the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

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

13. Matters on which we are required to report by exception

13.1. Adequacy of explanations received and accounting records

Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not received all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received

from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

13.2. Directors’ remuneration

Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of directors’ remuneration have not
been made or the part of the directors’ remuneration report to be audited is not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

14. Other matters

14.1. Auditor tenure

Following the recommendation of the Audit Committee, we were appointed by the shareholders at the Annual General Meeting
in April 2002 to audit the financial statements for the year ended 30 September 2002 and subsequent periods. The period of total
uninterrupted engagement including previous renewals and reappointments of the firm is 19 years, covering the years ending
30 September 2002 to 2020.

14.2. Consistency of the audit report with the additional report to the Audit Committee

Our audit opinion is consistent with the additional report to the Audit Committee we are required to provide in accordance with
ISAs (UK).

15. Use of our report

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

Robert Topley FCA (Senior statutory auditor)
for and on behalf of Deloitte LLP
Statutory Auditor

London, United Kingdom
24 November 2020

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Financial
Statements

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Contents
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet
Consolidated Statement of Changes in Equity
Company Balance Sheet
Company Statement of Changes in Equity
Consolidated Cash Flow Statement
Company Cash Flow Statement
Notes to the Financial Statements
General information
1.
Application of new and revised International Financial Reporting
2.
Standards (‘IFRSs’) and changes in accounting policies
Significant accounting policies
Critical accounting judgements and key sources of estimation uncertainty
Income
Segmental information
Staff costs
Profit for the year
Finance income and finance costs
Income tax expense

3.
4.
5.
6.
7.
8.
9.
10.
11. Dividends
Earnings per share
12.
Intangible assets
13.
Property, plant and equipment
14.
Leases
15.
Finance lease receivables
16.
17.
Investment in subsidiaries
18. Defined benefit pension scheme
Trade and other receivables
19.
Financial instruments
20.
21. Cash and cash equivalents
22.
23.
24.
25.
26. Net deferred tax liability
27.
Share capital
28. Own shares
29. Other reserves
30. Risk management
31.
Share-based payments
32. Operating lease arrangements
33. Contractual commitments
34. Notes to the Cash Flow Statement
35. Business combinations
36. Related party transactions
37.
38.
Five Year Record – continuing operations (unaudited)
Appendix – calculation of KPIs

Trade and other payables
Lease liabilities
Provisions
Shares to be issued

Impact of application of IFRS 16 Leases
Post balance sheet events

115
116
117
118
119
120
121
122

123

123
125
135
137
138
139
139
140
140
141
142
143
145
146
147
148
149
153
154
154
155
155
156
157
158
158
160
160
161
168
169
169
170
171
175
176
177
180
181

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Annual Report and Accounts 2020

Consolidated Income Statement

Year ended 30 September 2020

Revenue
Other operating income
Income

Staff costs
Amortisation of intangible assets – client relationships and brand
Defined benefit pension scheme past service costs
Acquisition costs
Onerous contracts
Incentivisation awards
Other operating costs
Operating expenses

Operating profit
Finance income
Other gains and losses
Finance costs
Profit before tax
Tax
Profit for the year

Attributable to:
Equity holders of the parent

Earnings per share
Basic
Diluted

Note
5
5

7
13
18
35

2020
£’000
359,164
2,283
361,447

(199,485)
(11,072)
–
(3,600)
(250)
(1,192)
(82,056)
(297,655)

63,792
907
–
(2,627)
62,072
(14,117)
47,955

2019
£’000
336,301
2,808
339,109

(184,896)
(6,858)
(1,909)
(2,337)
(996)
(340)
(80,812)
(278,148)

60,961
1,708
1
(146)
62,524
(14,457)
48,067

47,955
47,955

48,067
48,067

12
12

16.3p
15.9p

17.0p
16.6p

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Financial Statements continued

Consolidated Statement of Comprehensive Income

Year ended 30 September 2020

Profit for the year
Items that will not be reclassified subsequently to profit and loss:
Actuarial gain on defined benefit pension scheme
Deferred tax charge on actuarial gain on defined benefit pension scheme
Fair value (loss)/gain on investments in equity instruments designated as at fair value through
other comprehensive income
Gain on disposal of investments in debt instruments designated as at fair value through other
comprehensive income
Tax on gain on disposal of investments in debt instruments designated as at fair value
through other comprehensive income

Note

18
26

Items that may be reclassified subsequently to profit and loss:
Loss on cash flow hedge
Exchange differences on translation of foreign operations

Other comprehensive income for the year net of tax
Total comprehensive income for the year

Attributable to:
Equity holders of the parent

2020
£’000
47,955

1,377
(609)

(5)

–

–
763

–
1,245
1,245
2,008
49,963

2019
£’000
48,067

5,601
(945)

200

(38)
4,819

(24)
(67)
(91)
4,728
52,795

49,963
49,963

52,795
52,795

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Annual Report and Accounts 2020

Consolidated Balance Sheet

As at 30 September 2020

Assets
Non-current assets
Intangible assets
Property, plant and equipment
Right of use assets
Finance lease receivables
Other receivables
Defined benefit pension scheme
Total non-current assets

Current assets
Trade and other receivables
Finance lease receivables
Financial assets at fair value through other comprehensive income
Financial assets at fair value through profit or loss
Current tax
Cash and cash equivalents
Total current assets
Total assets

Liabilities
Trade and other payables
Current tax
Lease liabilities
Provisions
Total current liabilities
Net current assets

Non-current liabilities
Trade and other payables
Shares to be issued
Net deferred tax liability
Lease liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets

Equity
Share capital
Share premium account
Own shares
Hedging reserve
Revaluation reserve
Merger reserve
Profit and loss account
Equity attributable to equity holders of the parent

1. Presented following the adoption of IFRS 16 ‘Leases’ – see notes 2 and 37 for more detail.

Approved by the Board of Directors and authorised for issue on 24 November 2020.

Note

2020
£’000

As at

1 October
20191
£’000

At
30 September
2019
£’000

13
14
15
16
19
18

19
16
20
20

23
24

22
25
26
23
24

27
27
28
29
29
29

174,717
9,723
38,042
1,966
931
20,324
245,703

241,939
167
68
379
3,909
180,533
426,995
672,698

256,036
–
8,316
4,798
269,150
157,845

459
3,738
9,094
45,265
9,956
68,512
337,662
335,036

3,032
58,340
(25,238)
–
(2)
70,553
228,351
335,036

117,246
10,442
43,305
1,181
688
17,373
190,235

214,841
118
79
373
–
229,199
444,610
634,845

217,882
6,035
6,653
3,829
234,399
210,211

832
3,668
1,376
51,131
11,549
68,556
302,955
331,890

3,032
58,238
(25,214)
(24)
3
70,553
225,302
331,890

117,246
10,659
–
–
–
17,373
145,278

216,212
–
79
373
–
229,199
445,863
591,141

220,921
6,035
–
4,350
231,306
214,557

832
3,668
2,699
–
14,933
22,132
253,438
337,703

3,032
58,238
(25,214)
(24)
3
70,553
231,115
337,703

Signed on its behalf by

Robin Beer
Chief Executive Officer

www.brewin.co.uk

Siobhan Boylan
Chief Financial Officer

Brewin Dolphin

117

Strategic ReportGovernanceFinancial StatementsOther Information

Financial Statements continued

Consolidated Statement of Changes in Equity

Year ended 30 September 2020

At 30 September 2018
Profit for the year
Other comprehensive income for the year

Deferred and current tax on other
comprehensive income
Actuarial gain on defined benefit pension scheme
Fair value movement on investments in equity
instruments designated as at fair value through
other comprehensive income
Gain on disposal of investments in debt
instruments designated as at fair value through
other comprehensive income
Loss on cash flow hedge
Exchange differences on translation
of foreign operations

Total comprehensive (expense)/income for the year
Dividends
Issue of share capital
Placing of shares
Own shares acquired in the year
Own shares disposed of on exercise of options
Share-based payments
Share premium reduction
Tax on share-based payments
At 30 September 2019
Effect of change in accounting policy for initial
application of IFRS 16
At 1 October 2019
Profit for the year
Other comprehensive income for the year

Deferred tax on other comprehensive income
Actuarial gain on defined benefit pension scheme
Fair value movement on investments in equity
instruments designated as at fair value through
other comprehensive income
Exchange differences on translation
of foreign operations

Total comprehensive (expense)/income for the year
Dividends
Issue of share capital
Own shares acquired in the year
Own shares disposed of on exercise of options
Share-based payments
Hedge reversal
Tax on share-based payments
At 30 September 2020

Note

Share
premium
account
£’000

Share
capital
£’000

Own
shares
£’000
2,834 152,477 (26,060)
–

–

Attributable to the equity holders of the parent

Profit

Revaluation
reserve
£’000

Merger
reserve
£’000

and loss
account1
£’000

Total
£’000
2 70,553 73,931 273,737
– 48,067 48,067
–

Hedging
reserve
£’000
–
–
–

–
–

(983)
5,601

–

–
–

28
28

–
–
–
–
–
–
95
2
58,181
196
–
–
–
–
–
–
– (152,515)
–
–
3,032

–
–
–
–
–
(8,898)
9,744
–
–
–
58,238 (25,214)

–
3,032
–

–

–
58,238 (25,214)
–

–

26
18

–
–

–

11
27
28
28

–
–
–
–
–
–
–
–
–
3,032

–
–
–
102
–
–
–
–
–

–
–
–
–
(8,388)
8,364
–
–
–
58,340 (25,238)

–
(24)

–
(24)
–
–
–
–
–
–
–
–
(24)

–
(24)
–

–
–

–

–
–
–
–
–
–
–
24
–
–

–
–

200
–

200
(24)

–
(67)
(67)
–
– 52,818 52,795
1
(45,986)
–
(45,986)
–
–
–
97
–
– 58,377
–
–
(8,898)
–
–
–
–
(9,744)
–
–
7,769
–
7,769
–
–
– 152,515
–
–
(188)
(188)
–
3 70,553 231,115 337,703

–

(5,813)

–
(5,813)
3 70,553 225,302 331,890
– 47,955 47,955
–

–
–

(5)

–
–

–

(609)
1,377

–

(5)

1,245

–
1,245
–
– 49,968 49,963
(5)
(48,393)
–
–
102
–
–
(8,388)
–
–
–
–
–
9,779
–
–
24
–
–
–
59
–
(2) 70,553 228,351 335,036

(48,393)
–
–
(8,364)
9,779
–
59

1. A cumulative credit of £1,164k has been recognised in the profit and loss account reserve as at 30 September 2020 for exchange differences on translation

of foreign operations (2019: £81k debit, 2018: £14k debit).

118

Brewin Dolphin

Annual Report and Accounts 2020

Company Balance Sheet

As at 30 September 2020

Assets
Non-current assets
Investment in subsidiaries
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets

Liabilities
Current liabilities
Trade and other payables
Total current liabilities
Net current assets

Non-current liabilities
Shares to be issued
Total non-current liabilities
Total liabilities
Net assets

Equity
Share capital
Share premium account
Own shares
Hedging reserve
Merger reserve
Profit and loss account
Equity attributable to equity holders

Approved by the Board of Directors and authorised for issue on 24 November 2020.

Signed on its behalf by

Robin Beer
Chief Executive Officer

Brewin Dolphin Holdings PLC
Company Number: 02685806

Siobhan Boylan
Chief Financial Officer

Note

2020
£’000

2019
£’000

19
21

27
27
28
29
29
29

238,659
238,659

192,215
192,215

35,042
1,256
36,298
274,957

38,967
47,000
85,967
278,182

12,419
12,419
23,879

13,039
13,039
72,928

3,738
3,738
16,157
258,800

3,668
3,668
16,707
261,475

3,032
58,340
(25,238)
(24)
70,838
151,852
258,800

3,032
58,238
(25,214)
(24)
70,838
154,605
261,475

www.brewin.co.uk

Brewin Dolphin

119

Strategic ReportGovernanceFinancial StatementsOther Information

Financial Statements continued

Company Statement of Changes in Equity

Year ended 30 September 2020

Attributable to the equity holders of the Company

At 30 September 2018
Profit for the year
Other comprehensive income for the year

Loss on cash flow hedge

Total comprehensive expense for the year
Dividends
Issue of share capital
Placing of shares
Own shares acquired in the year
Own shares disposed of on exercise of options
Share premium reduction
Share-based payments
At 30 September 2019
Profit for the year
Dividends
Issue of share capital
Own shares acquired in the year
Own shares disposed of on exercise of options
Share-based payments
At 30 September 2020

Note

28
28

11
27
28
28

Share
premium
Share
account
capital
£’000
£’000
2,834 152,477
–

–

–
–
–
–
–
–
95
2
58,181
196
–
–
–
–
– (152,515)
–
–
58,238
3,032
–
–
–
–
102
–
–
–
–
–
–
–
58,340
3,032

Own
shares
£’000
(26,060)
–

–
–
–
–
–
(8,898)
9,744
–
–
(25,214)
–
–
–
(8,388)
8,364
–
(25,238)

Hedging
reserve
£’000
–
–

(24)
(24)
–
–
–
–
–
–
–
(24)
–
–
–
–
–
–
(24)

Profit
and loss
account
£’000

(775)

Merger
reserve
£’000
70,838
–

Total
£’000
50,826 250,915
(775)
–
–
–
(24)
(775)
–
(799)
(45,986)
–
(45,986)
–
–
97
–
–
58,377
–
–
(8,898)
–
(9,744)
–
– 152,515
–
7,769
7,769
–
70,838 154,605 261,475
44,225
44,225
(48,393)
(48,393)
102
–
(8,388)
–
–
(8,364)
9,779
9,779
70,838 151,852 258,800

–
–
–
–
–
–

120

Brewin Dolphin

Annual Report and Accounts 2020

Consolidated Cash Flow Statement

Year ended 30 September 2020

Net cash inflow from operating activities

Cash flows from investing activities

Purchase of intangible assets – client relationships
Purchase of intangible assets – software
Purchase of property, plant and equipment
Acquisition of subsidiaries
Proceeds on disposal of financial instruments at fair value through other comprehensive income

Net cash used in investing activities

Cash flows from financing activities
Dividends paid to equity shareholders
Purchase of own shares
Cash flow hedge
Repayment of lease liabilities
Cash payments from lessees
Proceeds on issue of shares

Net cash (used in)/from financing activities

Note
34

2020
£’000
77,386

2019
£’000
66,647

–
(26,523)
(2,379)
(32,029)
6
(60,925)

(48,393)
(8,388)
–
(8,765)
203
102
(65,241)

(10,011)
(10,064)
(5,249)
(2,680)
799
(27,205)

(45,986)
(8,898)
(24)
–
–
58,474
3,566

11
28

23
16
27

Net (decrease)/increase in cash and cash equivalents

(48,780)

43,008

Cash and cash equivalents at 1 October

Effect of foreign exchange rates

Cash and cash equivalents at 30 September

229,199
114
180,533

186,222
(31)
229,199

www.brewin.co.uk

Brewin Dolphin

121

Strategic ReportGovernanceFinancial StatementsOther Information

Financial Statements continued

Company Cash Flow Statement

Year ended 30 September 2020

Net cash inflow from operating activities

Cash flows from investing activities
Capital contribution to subsidiary
Net cash used in investing activities

Cash flows from financing activities
Dividends paid to equity shareholders
Cash flow hedge
Foreign exchange
Proceeds on issue of shares
Net cash (used in)/from financing activities

Note
34

2020
£’000
49,170

2019
£’000
33,091

(45,449)
(45,449)

(48,393)
–
(1,174)
102
(49,465)

–
–

(45,986)
(24)
–
58,474
12,464

Net (decrease)/increase in cash and cash equivalents

(45,744)

45,555

Cash and cash equivalents at 1 October
Cash and cash equivalents at 30 September

47,000
1,256

1,445
47,000

122

Brewin Dolphin

Annual Report and Accounts 2020

Notes to the Financial Statements

1. General information

The consolidated financial statements of Brewin Dolphin Holdings PLC (the ‘Company’) and its subsidiaries (collectively, the ‘Group’)
for the year ended 30 September 2020 were authorised for issue by the Directors on 24 November 2020.

The Company is a public company limited by shares and is incorporated in the United Kingdom under the Companies Act 2006.
The nature of the Group’s operations and its principal activities are set out in the Strategic Report. The Company is registered
in England and Wales. The address of the registered office is 12 Smithfield Street, London EC1A 9BD. The separate financial
statements of the Company are also reported.

Note 17 identifies the subsidiaries that have taken advantage under s479A of the Companies Act 2006 of the exemption from audit.

The significant accounting policies have been disclosed below. The accounting policies for the Group and the Company are consistent
unless otherwise stated.

2. Application of new and revised International Financial Reporting Standards (‘IFRSs’) and changes

in accounting policies

a. New standards, amendments and interpretations adopted

IFRS 16 ‘Leases’, a new standard, has been applied for the first time, it replaces IAS 17.

The Group adopted IFRS 16 Leases with effect from 1 October 2019 and elected to apply the standard retrospectively under the
modified retrospective approach with the cumulative effect of initial application being recognised at 1 October 2019; comparative
information has therefore not been restated.

Further information and changes to significant accounting policies as a result of the application of the standard for the first time are
described below in note 2b.

Changes in accounting policies

There have been no changes to accounting policies in the year except for the changes described below:

IFRS 16 Leases

IFRS 16 represents a significant change in the principles for the recognition, measurement, presentation and disclosure of leases.
IFRS 16 requires lessees to account for most leases under a single lessee accounting model.

Under the single lessee accounting model, a right of use (‘ROU’) asset and corresponding lease liability is recognised which
represents future lease payables with movements through the Income Statement. The movements through the Income Statement are
for depreciation, additions or releases on the liability and unwinding of the discount for all leases unless the underlying asset has
a low value, or the remaining lease term is less than twelve months at the date of transition.

Lessor accounting under IFRS 16 is substantially unchanged from IAS 17. Lessors continue to classify leases as either operating
or finance leases using similar principles as in IAS 17.

Transition

The Group has applied the modified retrospective approach with the cumulative effect of initial application being recognised at the
transition date; comparative information has therefore not been restated and continues to be reported under IAS 17.

The Group has used the following practical expedients when applying the modified retrospective approach to leases previously
classified as operating leases under IAS 17. The Group has:

• elected to use the transition practical expedient allowing an entity not to reassess whether a contract is, or contains, a lease at the

date of initial application of the standard;

• relied on its assessment of whether leases are onerous immediately before the date of initial application by adjusting the ROU asset

at 1 October 2019 by the amount of provision for onerous lease rental payments previously recognised under IAS 17 as at
30 September 2019, as an alternative to performing an impairment review;

• elected not to recognise the ROU assets and lease liabilities for leases where the lease term ends within 12 months of the date

of initial application;

• excluded initial direct costs from the measurement of the right of use asset at the date of initial application;
• used hindsight when determining the lease term where the contract contains options to extend or terminate the lease; and
• applied a single discount rate to a portfolio of leases with reasonably similar characteristics.

The Group has chosen not to apply the practical expedient to account for any associated non-lease components of a lease
as a single arrangement.

www.brewin.co.uk

Brewin Dolphin

123

Strategic ReportGovernanceFinancial StatementsOther InformationNotes to the Financial Statements continued

2. Application of new and revised International Financial Reporting Standards (‘IFRSs’) and changes

in accounting policies continued

Impact

The details of the significant changes are set out below. The Group is primarily a lessee and is also a sub-lessor for a small number
of property leases that have been identified as onerous.

The adoption of IFRS 16 has had a material impact on the Group’s Consolidated Balance Sheet, in which the Group recognised right
of use assets of £43.3m, lease liabilities of £57.8m, finance lease receivables of £1.3m, and a negative impact on the Group’s equity of
£5.8m net of deferred tax assets, onerous provisions and trade payables and receivables adjustments at 1 October 2019 on transition.

Details of the quantitative impact of IFRS 16 are provided in note 37.

Classification and measurement as a lessee

Right of use assets
The right of use assets recognised on adoption have been calculated as if the standard applied at the commencement of each lease
and are discounted using the borrowing rate at the date of initial application.

The depreciation charge is recognised in the Income Statement.

The ROU assets are assessed for impairment annually in accordance with IAS 36 (incorporating any onerous lease assessments)
and depreciated on a straight-line basis over the shorter of the expected life of the asset and the lease term, adjusted for any
remeasurements of the lease liability.

Lease liabilities
Leases previously classified as operating leases under IAS 17 have been measured at the present value of the remaining lease
payments on adoption and discounted using an incremental borrowing rate at the lease commencement date as the interest rate
implicit in the lease is not readily determinable.

After the commencement date, the lease liability recognised will reduce over time by the lease payments which will be offset by the
unwinding of the liability over the lease term and any amendments for the impact of any lease modifications. Interest recognised on the
lease liability is included in finance costs in the Income Statement.

Short-term leases and lease of low value assets
The Group has adopted certain optional recognition exemptions available under IFRS 16 for short-term (less than 12 months) and low
value (< £5,000) leases. These leases continue to be off balance sheet with rentals charged to the Income Statement on a straight-line
basis over the lease term and are classified as operating leases.

Classification and measurement as a lessor

Subleases
The Group has identified certain property leases as onerous where there is surplus office space and in these instances the Group acts
as an intermediate lessor. The Group classifies its subleases as operating or finance leases by reference to the right of use asset arising
from the head lease (rather than by reference to the underlying asset) or if the head lease belonging to the Group is a short-term lease,
the subleases are classified as operating leases.

The Group has reclassified some of its subleases previously recognised as operating leases under IAS 17 as finance leases
under IFRS 16.

Finance lease receivable
A finance lease receivable has been recognised on adoption and represents the net investment in the finance sublease.

The lease payments included in the measurement of the net investment in the finance lease comprise the present value of fixed
payments (including in-substance fixed payments), less any lease incentives payable for the right to use the underlying asset during the
lease term that are not received at the lease commencement date.

Any difference between the right of use asset and the net investment in the sublease is recognised in the Income Statement.

The lease liabilities relating to the head leases have been retained on the Balance Sheet and represent the lease payments payable
to the head lessor.

Operating subleases
For subleases which are classified as an operating lease, the Group has recognised both the lease liability and the right of use asset
relating to the head lease.

Lease income from the operating sublease is recognised in the Income Statement as other operating income.

124

Brewin Dolphin

Annual Report and Accounts 2020

c. New standards, amendments and interpretations issued but not effective

The table below sets out changes to accounting standards which will be effective for periods beginning on or after:

New or revised standards
IFRS 171
Amendments
IAS 11 – classification of liabilities
Further amendments – IFRS 3; IAS 16;
IAS 37; Annual Improvements

IFRS 4
Interest Rate Benchmark Reform – phase 2
IFRS 16
Conceptual framework references1
IAS 1 and IAS 8 – Definition of Material1

IFRS 3 – Definition of a Business
Interest Rate Benchmark Reform – phase 1

Insurance Contracts

Presentation of financial statements’ on classification of liabilities
IFRS 3 Business Combinations; IAS 16 Property, Plant and Equipment –
Proceeds before Intended Use; IAS 37 Provisions, Contingent Liabilities and
Contingent Assets; Annual Improvements 2018-2020
Amendments to IFRS 4 Insurance Contracts – deferral of IFRS 19
Amendments to IFRS 9, IAS 39 and IFRS 7, IFRS 4 and IFRS 16
Leases, Related rent concessions
Amendments to References to the Conceptual Framework in IFRS Standards
Presentation of Financial Statements and Accounting Policies, Changes in
Accounting Estimates and Errors
Business Combination
Amendments to IFRS 9, IAS 39 and IFRS 7, IFRS 4 and IFRS 16

1 January

2023

2023
2022

2021
2021
2020
2020
2020

2020
2020

1. These amendments have not yet been endorsed by the EU.

The Directors are reviewing the impact of these new standards, amendments and interpretations and do not intend to adopt the
standards early. It is not currently expected that these will have a material impact on the financial statements of the Group.

3. Significant accounting policies

Statement of compliance

The financial statements for the Company and the consolidated financial statements for the Group have been prepared in accordance
with International Financial Reporting Standards (‘IFRSs’) adopted by the European Union, Article 4 of the EU IAS Regulation and the
Companies Act 2006.

b. Basis of preparation

The consolidated financial statements are presented in pounds sterling, the functional currency of the Company, rounded to the nearest
thousand pounds (£’000) except where otherwise indicated. The foreign operations have been translated into the functional currency
at a spot rate of €/£1.1025 for the Balance Sheet at 30 September 2020 (2019: €/£1.1303) and the average exchange rate of €/£1.141
for the Income Statement items for the financial year ending 30 September 2020 (2019: €/£1.1326).

The consolidated financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial
instruments. Historical cost is generally based on the fair value of the consideration given in exchange for the goods and services.

Impairment considerations

At each balance sheet date, the Group reviews the carrying amounts of its assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset or cash-generating
unit (‘CGU’) is estimated in order to determine the extent of the impairment loss (if any). Goodwill is tested annually for impairment
or more frequently when there are impairment indicators.

The impairment review considered the COVID-19 pandemic as a potential indicator of impairment and consequently an extensive
exercise was undertaken to determine the recoverable amount for all material assets to assess for impairment losses. The higher of the
fair value less costs to dispose (‘FVLCTD’) and the value in use (‘VIU’) was determined to be the recoverable amount; this was
compared to the carrying amount.

The estimated FVLCTD for assets were based on a percentage of funds, where appropriate. The percentages applied are inherently
judgemental and were adjusted to reflect the current economic environment. The VIU calculations which are subject to estimation
uncertainty were derived from a discounted cash flow calculation based on the Group’s Medium-Term Plan which reflects recently
observable trends, management expectations and expected future events, covering a five-year period. Cash flows beyond the five-year
period were extrapolated using long-term growth rates.

As a result of these reviews, none of the assets held by the Group were impaired – see note 13 for further details.

www.brewin.co.uk

Brewin Dolphin

125

Strategic ReportGovernanceFinancial StatementsOther Information

Notes to the Financial Statements continued

3. Significant accounting policies continued

ii) Going concern

The Directors have, at the time of approving the financial statements, a reasonable expectation that the Company and the Group have
adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis
of accounting in preparing the financial statements.

To form the view that the consolidated financial statements should continue to be prepared on an ongoing basis in light of the current
COVID-19 pandemic and the resultant economic uncertainty and volatility, the Directors have assessed the outlook of the Group
by considering:

i. the Group’s Medium-Term Plan (‘MTP’); and
ii. the performance of a range of stress tests including reverse stress tests that are used as part of the Internal Capital Adequacy

Assessment Process (‘ICAAP’) to assess the Group’s ability to withstand a market-wide stress.

The stress tests enable the modelling of the impact of a variety of external and internal events on the MTP; identify the potential impact
of stress events on the Group’s income, costs, cash flow and capital; and enable the Directors to assess management’s ability to
implement effective management actions that may be taken to mitigate the impact of the stress events. The reverse stress tests have
considered severe scenarios and actions and allow the Directors to assess scenarios and circumstances that would render the Group’s
business model unviable.

Further detail is contained in the going concern statement and the Viability Statement included in the Strategic Report on page 49.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company
(its subsidiaries).

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses
control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in the consolidated
Income Statement from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies into line with those
used by the Group.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

In accordance with Section 408 of the Companies Act 2006 Brewin Dolphin Holdings PLC has taken advantage of the legal
dispensation not to present its own Statement of Comprehensive Income or Income Statement. The amount of the profit for the
financial period dealt with in the financial statements of the Company is disclosed in the Company Statement of Changes in Equity.

d. Business combinations

Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The consideration for each acquisition
is measured at the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity
instruments issued by the Group in exchange for control of the acquiree. Acquisition related costs such as legal and professional costs
are recognised in the Income Statement as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the
acquisition date.

Goodwill is measured as the excess of the sum of the consideration transferred over the net of the acquisition-date amounts of the
identifiable assets acquired and liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable
assets acquired and liabilities assumed exceeds the sum of the consideration transferred the excess is recognised immediately
in the Income Statement as a bargain purchase gain.

Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent consideration
arrangement, measured at its acquisition-date fair value. Subsequent changes in such fair values are adjusted against the cost
of acquisition where they qualify as measurement period adjustments. All other subsequent changes in the fair value of contingent
consideration classified as an asset or liability are accounted for in accordance with relevant IFRSs. Changes in the fair value
of contingent consideration classified as equity are not recognised.

Transaction date accounting

All securities transactions entered into on behalf of both clients and the Group are recorded in the accounts on the date
of the transaction. The underlying investments are not shown in the financial statements of the Group.

Foreign currencies

In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency
(foreign currencies) are recognised at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date,
monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing at that date.
Non-monetary items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date
when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are
not retranslated.

Exchange differences are recognised in the Income Statement in the period in which they arise.

126

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Annual Report and Accounts 2020

For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign operations are
translated at exchange rates prevailing on the balance sheet date. Income and expense items are translated at the average exchange
rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the transaction
dates are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in equity.

g. Revenue recognition

Revenue represents investment management fees, investment management commissions, financial planning income, execution only fee
and commission income and expert report writing service income, excluding VAT.

Identification of performance obligations

The Group assesses all the services expressed in its contracts with customers to identify performance obligations. The Group delivers
several series of distinct services that are substantially the same and have the same pattern of transfer to the customer. All the services
are highly interrelated and interdependent and are integrated to provide an overall service to the customer. The Group bundles series
of services into specific performance obligations where the services have the same pattern of transfer to the customer.

Transaction price

Revenue is measured based on the consideration specified in customer contracts excluding amounts collected on behalf
of third parties, that the Group is entitled to in exchange for transferring services to a customer.

The transaction price for services provided over time is variable as it is based on the value of customers’ assets at a specific
billing point.

Payment is typically due for services within three months.

Satisfaction of performance obligations

The Group recognises revenue when it transfers control over a service to a customer and satisfies its performance obligations, this can
be at a point in time or over time.

For performance obligations satisfied over time the Group measures progress towards complete satisfaction of the performance
obligations equally over time. The Group recognises revenue when the relevant performance obligation has been satisfied and the
customer simultaneously receives and consumes the benefits of the services. Where a contract contains variable consideration,
the Group estimates the amount to which it is entitled under the contract. The Group constrains the estimate where there is a risk
of significant revenue reversal and reassesses this estimate at the end of the relevant billing period when the variable consideration
amount is known.

For the performance obligations delivered at a point in time, the Group simultaneously satisfies the performance obligations and
recognises revenue at the point the trade is executed which is when the customer receives control of the services.

Nature of services

The following are the principal activities from which the Group generates its revenue.

Investment management

The Group recognises management fees and commissions from its direct or indirect clients on fulfilment of its discretionary
investment management, advisory investment management, Brewin Portfolio Service (‘BPS’) or Model Portfolio Service (‘MPS’)
performance obligations.

All investment management performance obligations are satisfied over time except for trade execution services provided to advisory
clients which are satisfied at a point in time.

Financial planning

The Group recognises financial planning income (initial fees, initial commissions and ongoing advice fees) on fulfilment of its financial
planning advisory, initial or transactional services performance obligations. The performance obligations are satisfied over time.

Execution only

The Group recognises fees and trade execution commission on fulfilment of its performance obligations. Performance obligations
for custody services are satisfied over time and trade execution service performance obligations are satisfied at a point in time.

Expert witness report service

The Group recognises fees for the provision of expert witness reports on fulfilment of its performance obligations which are satisfied
at a point in time.

Contract costs

Introducer fees which are incremental costs incurred to obtain a contract with a customer are capitalised. These costs are amortised
over the useful life of the client relationships intangible asset.

Interest income

Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net
carrying amount.

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3. Significant accounting policies continued

Dividend income

Dividend income from investments is recognised when the shareholders’ rights to receive payment have been established.

Dividends received and receivable are credited to the Income Statement to the extent that they represent a realised profit and loss
for the Company.

Other operating income

Other operating income includes the net of interest receivable and payable on client money balances and represents the Group’s share
of interest receivable and rental income from operating subleases (see note 2k). Research & Development tax credit incentives are also
included in other operating income.

Leases

The Group has applied IFRS 16 as described in note 2b and comparative information has not been restated. The details of accounting
policies under both IAS 17 and IFRS 16 are presented separately below.

The Group is primarily a lessee of property and is also a sub-lessor for a small number of property leases.

Policies applicable from 1 October 2019

(a) The Group as a lessee

For any new contracts entered into on or after 1 October 2019, the Group considers whether a contract is, or contains a lease
by assessing whether the contract meets three key criteria which are:

• the contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified

at the time the asset is made available to the Group;

• the Group has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period

of use, considering its rights within the defined scope of the contract; and

• the Group has the right to direct the use of the identified asset throughout the period of use.

Right of use assets (‘ROU’)

The Group recognises right of use assets at the commencement date of the lease (i.e. the date the underlying asset is available for use).
Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of the right of use assets includes the initial amounts of the corresponding lease
liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease
incentives received.

An estimate of any costs to return the leasehold asset to the condition required by the contract is included in the related ROU asset and
a corresponding provision is recognised.

The depreciation charge is recognised in the Income Statement and is calculated over the shorter of the ROU’s useful life and the lease
term on a straight-line basis from the commencement date of the lease.

The ROU assets are assessed for impairment annually (incorporating any onerous lease assessments).

Lease liabilities

At the commencement date of a lease, the Group recognises lease liabilities measured at the present value of lease payments
to be made over the lease term. Lease payments included in the measurement of the lease liability comprise the following items,
where applicable:

• fixed payments less any lease incentives receivable;
• variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date;
• the amount expected to be payable by the lessee under residual value guarantees;
• the exercise price of purchase options, if the lease term reflects the exercise of an option to terminate the lease; and
• payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.

In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date
if the interest rate implicit in the lease is not readily determinable. After the commencement date, the lease liabilities are reduced for
payments made and increased for interest. Interest recognised on the lease liability is included in finance costs in the Income Statement.

The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance
fixed lease payments or a change in the assessment to purchase the underlying asset. On remeasurement of the lease liability,
the corresponding adjustment is reflected in the ROU asset; if the ROU asset is already reduced to nil, the adjustment is recognised
in the Income Statement.

Short-term leases and lease of low value assets

The Group has adopted certain optional recognition exemptions available under IFRS 16 for short-term (less than 12 months) and low
value (< £5,000) leases. These leases are held off balance sheet with rentals charged to the Income Statement on a straight-line basis
over the lease term and are classified as operating leases. Benefits received and receivable as an incentive to enter into an operating
lease are recognised as a liability. The aggregate benefit of incentives is spread on a straight-line basis over the lease term.

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(b) The Group as an intermediate lessor

Subleases

The Group acts as an intermediate lessor in respect of surplus office space, in which the Group classifies its subleases either as an
operating or finance lease by reference to the right of use asset arising from the head lease (rather than by reference to the underlying
asset) or if the head lease belonging to the Group is a short-term lease, the sublease is classified as an operating lease. The Group
accounts for the head lease and the sublease as two separate contracts.

Finance lease receivable

Amounts due from lessees under finance leases are recognised as a finance lease receivable and represent the Group’s net investment
in the finance sublease.

Any difference between the right of use asset and the net investment in the sublease is recognised in the Income Statement.

The Group applies the discount rate used for the head lease (adjusted for any initial direct costs associated with the sublease)
to measure the net investment in the sublease.

Finance lease income is allocated to accounting periods so as to reflect the constant periodic rate of return on the Group’s net
investment outstanding in respect of the leases.

Any allowances for expected credit losses are recognised against finance lease receivables as required by IFRS 9, if applicable.

The lease liabilities relating to the head leases are retained on the Balance Sheet and represent the lease payments payable to the
head lessor.

Operating subleases

For subleases which are classified as an operating lease, the Group recognises both the lease liability and the ROU asset relating
to the head lease. Rental income from the operating sublease is recognised in the Income Statement as other operating income
on a straight-line basis over the term of the relevant sublease.

Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and
recognised on a straight-line basis over the lease term.

Policies applicable prior to 1 October 2019

Rentals on operating leases are charged to the Income Statement on a straight-line basis over the lease term. Benefits received and
receivable as an incentive to enter into an operating lease are recognised as a liability. The aggregate benefit of incentives is spread
on a straight-line basis over the lease term.

Share-based payments

Equity-settled share-based payments to employees are measured at fair value of the equity instruments at the date of grant. The fair
value excludes the effect of non-market-based vesting conditions. Details regarding the determination of the fair value of equity–settled
share-based transactions are set out in note 31.

Fair value is measured by use of the Black-Scholes option pricing model. The expected life used in the model has been adjusted,
based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the
vesting period, based on the Group’s estimate of the number of shares that will eventually vest. At each balance sheet date, the Group
revises its estimate of the shares expected to vest as a result of the effect of non-market based vesting conditions. The impact
of the revision of the original estimates, if any, is recognised in the Income Statement such that the cumulative expense reflects the
revised estimate, with a corresponding adjustment to equity reserves.

m. Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the Income
Statement because it excludes items of income or expenses that are taxable or deductible in other years and items that are
never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted by the balance
sheet date.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the
balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary
differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

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3. Significant accounting policies continued

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised
based on tax laws and rates that have been substantively enacted at the balance sheet date.

The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the
Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current
tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax
assets and liabilities on a net basis.

Current and deferred tax for the year

Current and deferred tax is charged or credited in the Income Statement, except when it relates to items charged or credited in other
comprehensive income, in which case the current and deferred tax is also dealt with in other comprehensive income.

Investments in subsidiaries

In the Company’s financial statements investments in subsidiary undertakings are stated at cost less any provision for impairment.

Intangible assets

Goodwill

Goodwill is initially measured at cost, being the excess of the sum of the consideration transferred, the amount of any non-controlling
interest in the acquiree and the fair value of the acquirer’s previously held equity interest (if any) in the entity over the net of the
identifiable assets and liabilities at the date of acquisition.

Goodwill is subsequently measured at cost less any accumulated impairment losses. Goodwill which is recognised as an asset
is reviewed for impairment at least annually. Any impairment is recognised immediately in the Income Statement and is not reversed
in a subsequent period (see note 3q for the Impairment accounting policy).

When the consideration transferred by the Group is deferred or contingent, this is valued at its acquisition date fair value, and is included
in the consideration transferred in a business combination. The consideration may be settled in shares or cash (see note 3u for the
Shares to be issued accounting policy). Changes in the deferred or contingent consideration, which occur in the measurement period,
are adjusted retrospectively, with corresponding adjustments to goodwill. Subsequent to the measurement period, the deferred and
contingent considerations are revised annually at the balance sheet date and any corresponding adjustments are posted to the
Income Statement.

Client relationships

Intangible assets classified as ‘client relationships’ are recognised when acquired as part of a business combination. The initial cost
of client relationships is the fair value at the acquisition date. Following initial recognition, intangible assets are carried at cost less
accumulated amortisation and any accumulated impairment losses.

When the consideration transferred by the Group is deferred or contingent as a result of a business combination, the consideration
may be settled in shares or cash (see note 3u for the Shares to be issued accounting policy). Subsequent to the measurement period,
the deferred and contingent considerations are revised annually at the balance sheet date and any corresponding adjustments are
posted to the Income Statement.

Client relationships acquired separately are initially recognised at cost. Following initial recognition, these are carried at cost less
accumulated amortisation and any accumulated impairment losses. See note 3g for the contract costs capitalised.

Client relationships are amortised on a straight-line basis over five to fifteen years, dependent upon the assessment of the estimated
useful life of the client relationships.

Brand

Intangible assets classified as ‘brand’ are recognised when acquired as part of a business combination. The initial cost of a brand is the
fair value at the acquisition date. Following initial recognition, the intangible asset is carried at cost less accumulated amortisation and
any accumulated impairment losses.

Brands are amortised on a straight-line basis over ten years, dependent upon the assessment of the estimated useful life of the brand.
The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes
in estimates being accounted for on a prospective basis.

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Computer software

Computer software which is not an integral part of the related hardware is classified as an intangible asset. Costs of acquiring
and developing computer software are treated as an intangible asset and amortised over three to ten years, dependent upon
the assessment of the expected useful life of the software, on a straight-line basis from the date the software is operating
as management intended.

The assessment of the expected useful life of computer software is performed annually and based on the contractual terms
or where appropriate past experience of the life of similar assets, with the effect of any changes in estimates being accounted for
on a prospective basis.

Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and any recognised impairment. Depreciation has been
provided on the basis of equal annual instalments to write off the cost less estimated residual values of tangible fixed assets over their
estimated useful lives as follows:

Computer equipment
Office equipment
Leasehold improvements

3 to 4 years
4 to 10 years
to the earlier of the expected lease term or 10 years

The gain or loss arising on the disposal of an asset is determined as the difference between the sales proceeds and the carrying amount
of the asset and is recognised in the Income Statement.

Impairment of tangible and intangible assets

At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there
is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset
is estimated in order to determine the extent of the impairment loss (if any).

The recoverable amount is the higher of fair value less costs to dispose and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value
of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. Where the asset does
not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating
unit (‘CGU’) to which the asset belongs.

For the purposes of impairment testing, client relationships, brand and goodwill are allocated to each of the Group’s cash-generating
units. Fair value is established by valuing clients’ funds in each of the cash-generating units at the period end; the percentages of funds
being used depend on values attributed in recent public transactions for the purchase of advisory and discretionary funds. If the carrying
amount relating to any cash-generating unit exceeds the calculated fair value less costs to dispose, a value in use is calculated using
a discounted cash flow method. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit,
the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets
of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

If the recoverable amount of any asset other than client relationships, brand or goodwill is estimated to be less than its carrying amount,
the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately,
unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Fair value measurement

The Group measures financial instruments and certain non-financial assets at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation
technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability
if market participants would take those characteristics into account when pricing the asset or liability at the measurement date.
Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis,
except for share-based payment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope
of IFRS 16, and measurements that have some similarities to fair value but are not fair value, such as value in use in IAS 36.

In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which
the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety,
which are described as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the

measurement date;

• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly

or indirectly; and

• Level 3 inputs are unobservable inputs for the asset or liability.

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3. Significant accounting policies continued

Financial instruments

Financial assets and financial liabilities are recognised when a Group entity becomes a party to the contractual provisions of the
instruments. Financial assets can include equity and debt instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition
or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are
added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction
costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised
immediately in the Income Statement.

Financial assets

All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the
classification of the financial assets.

(a) Classification of financial assets

Financial assets that meet the following conditions are subsequently measured at amortised cost (see (i) below):

• the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows;

and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest

on the principal amount outstanding.

Financial assets that meet the following conditions are subsequently measured at fair value through other comprehensive income
(‘FVTOCI’) (see (ii) & (iii) below):

• the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling

the financial assets; and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest

on the principal amount outstanding.

All other financial assets are subsequently measured at fair value through profit and loss (’FVTPL’) (see (iv) below). However, the Group
may make the following irrevocable election/designation at initial recognition of a financial asset:

• to present subsequent changes in fair value of an equity investment in other comprehensive income if certain criteria are met (see (iii)

below); and

• to designate a debt investment that meets the amortised cost or FVTOCI criteria as measured at FVTPL if doing so eliminates

or significantly reduces an accounting mismatch (see (iv) below).

(i) Financial assets at amortised cost

The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal
repayments and the cumulative amortisation using the effective interest method of any difference between that initial amount and the
maturity amount, adjusted for any loss allowance.

(ii) Debt instruments classified as at FVTOCI

Redeemable loan notes held by the Group are classified as FVTOCI. Fair value is determined in the manner described in note 3s.
The redeemable loan notes are initially measured at fair value plus transaction costs. Subsequently changes in the carrying amount
of the redeemable loan notes as a result of both foreign exchange gains and losses and impairment gains or losses are recognised
in the Income Statement. The amounts that are recognised in the Income Statement are the same as the amounts that would have
been recognised in the Income Statement if the redeemable loan notes had been measured at amortised cost. All other changes in the
carrying amount of these redeemable loan notes are recognised in other comprehensive income and accumulated under the heading
of revaluation reserve. When these redeemable loan notes are derecognised the cumulative gains or losses previously recognised
in other comprehensive income are reclassified to the Income Statement.

(iii) Equity instruments designated as at FVTOCI

On initial recognition, the Group may make an irrevocable election (on an instrument-by- instrument basis) to designate investments
in equity instruments as FVTOCI.

Investments in equity instruments at FVTOCI are initially measured at fair value plus transaction costs. Subsequently, they are measured
at fair value with gains and losses arising from changes in fair value recognised in other comprehensive income and accumulated in the
revaluation reserve. The cumulative gains and losses are not reclassified to the Income Statement on disposal of the equity investments,
instead, they are transferred to retained earnings.

The Group has designated all investments in equity instruments that are not held-for-trading as at FVTOCI.

Dividends on these investments in equity instruments are recognised in the Income Statement when the Group’s right to receive the
dividends is established in accordance with the Group’s revenue policy (see note 3i), unless the dividends clearly represent a recovery
of part of the cost of the investment. Dividends are included in the ‘Finance income’ line item in the Income Statement.

(iv) Financial assets at FVTPL

Financial assets that do not meet the criteria for being measured at amortised cost or FVTOCI (see (i) to (iii) above) are measured at FVTPL.

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The Group holds all held-for-trading equity instruments at FVTPL, unless the Group designates an equity investment that is neither
held-for-trading nor a contingent consideration arising from a business combination as at FVTOCI on initial recognition (see (iii) above).

Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any fair value gains or losses recognised
in the Income Statement. The net gain or loss recognised in the Income Statement includes any dividend or interest earned on the
financial asset and is included in the ‘other gains and losses’ line item. Fair value is determined in the manner described in note 3s.

(b)

Impairment of financial assets

Expected credit losses are recognised for trade debtors, other financial assets held at amortised cost and financial assets measured
at FVTOCI. At initial recognition, an allowance is made for expected lifetime credit losses using the simplified single loss-rate approach.
The expected credit loss is determined to be the difference between all contractual cash flows that are due to the Group and all the
cash flows that the Group expects to receive, adjusted for the value of any collateral held. Consideration is also given to the Group’s
historical credit loss experience, adjusted as necessary to reflect current and future economic conditions, for the relevant financial asset.

The expected credit loss allowance is adjusted as necessary at each balance sheet date to reflect changes in circumstances such
as default events that provide objective evidence of impairment. The Group determines financial assets are in default when a payment
is 90 days past due. An assessment of whether credit risk has increased significantly since initial recognition is not required under the
simplified approach.

Trade debtors are normally written off, either partially or in full, against the related allowance when there is no realistic prospect
of recovery, and the amount of the loss has been determined following the disposal of any collateral held. Subsequent recoveries
of amounts previously written off decrease the amount of impairment losses recorded in the Income Statement.

The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset are received, or when
it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party.

On derecognition of a financial asset measured at amortised cost, any difference between the carrying amount of the asset and the sum
of the consideration received is recognised in the Income Statement.

On derecognition of an investment in a debt instrument classified as at FVTOCI, the cumulative gain or loss previously accumulated
in the associated revaluation reserve is reclassified to the Income Statement.

On derecognition of an investment in an equity instrument which the Group has elected on initial recognition to measure at FVTOCI,
the cumulative gain or loss previously accumulated in the revaluation reserve is not reclassified to the Income Statement but is
transferred to retained earnings.

On derecognition of a financial asset measured at FVTPL the difference between the asset’s carrying amount and the sum of the
consideration received is recognised in the Income Statement.

Typically, the Group holds financial assets in business models where the value of the financial assets is recovered by collecting
contractual cash flows and/or selling the instrument. Hence these financial assets are derecognised once all the contractual cash flows
have been received or the financial asset has been sold or transferred.

Financial liabilities and equity

(a) Classification

Financial liabilities and equity are classified according to the substance of the contractual arrangements entered into.

(b) Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs. No gain or loss
is recognised in the Income Statement on the purchase, sale, issue or cancellation of the Company’s own equity instruments.

Financial liabilities are subsequently measured as either financial liabilities ‘at FVTPL’ or ‘amortised cost’. The Group holds all financial
liabilities at amortised cost and at FVTPL.

Financial liabilities subsequently measured at amortised cost

Financial liabilities that are not contingent consideration of an acquirer in a business combination, held-for-trading, or designated
as at FVTPL, are subsequently measured at amortised cost using the effective interest method.

Financial liabilities subsequently measured at FVTPL

Contingent consideration, resulting from business combinations, is valued at fair value at the acquisition date as part of the business
combination. When the contingent consideration meets the definition of a financial liability, it is subsequently remeasured to fair value at
each reporting date. The determination of the fair value is based on discounted cash flows. The key assumptions take into consideration
the probability of meeting each performance target and the discount factor (see note 35 Business combinations for further information).

(d) Derecognition of financial liabilities

The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire.
The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable, including any
non-cash assets transferred or liabilities assumed, is recognised in the Income Statement.

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3. Significant accounting policies continued

Derivative financial instruments (derivatives) and hedging activities

Derivatives are contracts or agreements whose value is derived from one or more underlying indices or asset values inherent in the
contract or agreement, which require no or little initial net investment and are settled at a future date. Derivatives are occasionally held
for risk management purposes.

Derivatives are initially recognised at fair value on the date a derivative contract is entered into, and they are subsequently remeasured
to their fair value at the end of each reporting period. The accounting for subsequent changes in fair value depends on whether the
derivative is designated as a hedging instrument and, if so, the nature of the item being hedged. The Group applies hedge accounting
in accordance with IAS 39 and designates certain derivatives as either:

• hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedges); or
• hedges of a particular risk associated with the cash flows of recognised assets and liabilities and highly probable forecast transactions

(cash flow hedges); or

• hedges of a net investment in a foreign operation (net investment hedges).

The Group designates derivatives in respect of foreign currency risk as cash flow hedges.

At inception of the hedge relationship, the Group documents the economic relationship between hedging instruments and hedged
items, including whether changes in the cash flows of the hedging instruments are expected to offset changes in the cash flows
of hedged items. The Group documents its risk management objective and strategy for undertaking its hedge transactions.

Movements in the hedging reserve in equity are detailed in note 29.

Cash flow hedges

The effective portion of changes in the fair value of foreign currency forward contracts that are designated and qualify as cash flow
hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately
in profit or loss, and is included in the ‘other gains and losses’ line item.

Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods
when the hedged item is recognised in profit or loss, in the same line of the Income Statement as the recognised hedged item.

Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires or is sold,
terminated, or exercised, or no longer qualifies for hedge accounting. Any gain or loss recognised in other comprehensive income
at that time is accumulated in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss.
When a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognised immediately in profit
or loss.

Shares to be issued including premium

Shares to be issued represent the Company’s best estimate of the amount of ordinary shares in the Company, which are likely
to be issued following business combinations or the acquisition of client relationships which involve deferred payments in the
Company’s shares. The sum payable which will be converted into shares of equivalent value is discounted to present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and is revised annually in the light of actual
results. The resulting interest charge from the unwind of the discount is included within finance costs. Where shares are due to be
issued within a year the sum is included in current liabilities.

v. Netting of balances

Amounts due to and from counterparties due to settle on balance are shown net where there is a currently enforceable legal right to set
off the recognised amounts and an operational intention to settle net. Amounts due to and from counterparties due to settle against
delivery of stock are shown gross.

w. Post-retirement benefits

Costs

Payments to defined contribution retirement benefit schemes are charged as an expense when employees have rendered services
entitling them to the contributions.

For defined benefit retirement benefit schemes, the cost of providing benefits is determined using the Projected Unit Method,
with actuarial valuations being carried out at each balance sheet date. Remeasurements comprising actuarial gains and losses and the
return on scheme assets (excluding interest) are recognised immediately on the Balance Sheet with a charge or credit to the Statement
of Other Comprehensive Income in the period in which they occur. Remeasurement recorded in the Statement of Other Comprehensive
Income is not recycled.

Net interest is calculated by applying a discount rate to the net defined benefit liability or asset and net interest expense or income
is recognised within finance costs (see note 9).

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Defined benefit pension scheme asset/liability

The defined benefit pension scheme asset/liability recognised on the Balance Sheet represents the present value of the defined benefit
pension scheme obligation, and as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited
to past service cost, plus the present value of available refunds and reductions in future contributions to the Scheme.

Any asset recognised is only recognised to the extent that the Group is able, without condition or restriction placed on it by the trustees,
to run the Scheme; until the last member dies, without benefits being augmented; wind up the Scheme at that point; and reclaim any
remaining monies.

Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event; it is probable that
the Group will be required to settle that obligation; and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the balance
sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash
flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (where the effect of the time
value of money is material).

Where some or all of the economic benefits required to settle a provision are expected to be recovered from a third party,
a receivable is recognised as an asset if it is virtually certain that the reimbursement will be received and the amount receivable
can be measured reliably.

Onerous contracts

Present obligations arising under onerous contracts are recognised and measured as provisions. An onerous contract is considered
to exist where the Group has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the
economic benefits expected to be received under it.

Employee share ownership trusts

Brewin Dolphin Limited is the sponsoring employer of the Brewin Dolphin Share Incentive Plan Trust and the Brewin Dolphin Holdings
PLC Employee Share Ownership Trust. The assets and liabilities of the trusts are recognised as those of Brewin Dolphin Holdings PLC
and obligations of the trusts are regarded as obligations of Brewin Dolphin Holdings PLC. Shares of Brewin Dolphin Holdings PLC held
by the trusts are treated as own shares held and shown as a deduction in equity.

4. Critical accounting judgements and key sources of estimation uncertainty

In the application of the Group’s accounting policies, which are described in note 3, the Directors are required to make judgements,
estimates and assumptions about the carrying amounts of the assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.

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

Critical judgements in applying the Group’s accounting policies

Leases – determining the lease term

The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option
to extend or terminate the lease. In making this judgement, the Group evaluates whether it is reasonably certain to exercise the option
to renew or break the lease term.

That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal and the circumstances and facts
for each lease including past experience to determine the likely lease term and whether the break option is likely to be exercised.
This includes an assessment on the length of time remaining before the option is exercisable, current trading conditions and future
trading forecasts on the ongoing profitability of the business.

After the lease commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that
is within its control and affects its ability to exercise (or not to exercise) the option to renew (for example, a change in business strategy).

As at 30 September 2020, it has been assumed that all leases will be until the end of the lease term for the Group.

b. Key sources of estimation uncertainty

Acquisitions

As part of any business combination the Group recognises all assets acquired and liabilities assumed at their acquisition date fair
values, including any separately identifiable intangible assets such as the client relationship intangibles recognised as part of the BDCIIL
acquisition (as set out in note 35).

The value attributed to the client relationships affects the amount of goodwill recognised. This value together with the assessment
of useful economic lives, which is based both on past experience and future expectations, determines the future amortisation charges.
Further, the value determined for the client relationships asset impacts the deferred tax liability recognised by the Group.

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4. Critical accounting judgements and key sources of estimation uncertainty continued

The valuation gives rise to estimation uncertainty. Certain assumptions regarding the amount, timing and discounting of future cash
flows have been adopted in order to determine these fair values. The Group has recognised £32.1m of separately identifiable client
relationship intangible assets and goodwill of £2.0m; see notes 13 and 35 for further information.

The table below sets out the approximate impact on the value recognised for both goodwill and client relationships intangibles
of an increase or decrease of 20% in the:

i. expected cash flows, applied equally over the cash flows in each period; and
ii. the discount rate.

Expected cash flows:
20% decrease
20% increase

Expected discount rate:

20% decrease
20% increase

Goodwill
£’000

2,661
(2,661)

(2,186)
1,979

Client
relationships
£’000

(3,041)
3,041

2,498
(2,261)

ii.

Impairment of goodwill, client relationships and brand

Impairment exists when the carrying value of an asset or cash-generating unit (‘CGU’) exceeds its recoverable amount. The recoverable
amount is the higher of its fair value less costs to dispose (‘FVLCTD’) and its value in use (‘VIU’).

For the purposes of impairment testing, the Group has historically valued the recoverable amount of goodwill, client relationships and
brand at the FVLCTD. The calculation of the FVLCTD is based on the valuation of the funds, which make up the relevant CGU where
appropriate. A percentage is applied to the funds to determine the fair value. These percentages have been based on recent public
transactions and adjusted to allow for the current economic uncertainty and volatility due to the COVID-19 pandemic.

However, recognising the challenge of estimating a reliable FVLCTD in the current uncertain economic environment due to
greater volatility, the Group has also prepared VIU calculations.

For the VIU calculations, the recoverable amount is sensitive to assumptions applied to future cash flows and the discount rate.
A sensitivity analysis is disclosed in note 13.

iii. Amortisation of client relationships

The useful economic life over which client relationships are amortised is determined by the expected duration of the client relationships
which are determined with reference to past experience of account closures, in particular the average life of those relationships,
and future expectations. During the year, client relationships were amortised over periods ranging from 5 to 15 years.

The amortisation for the year was £10,933,000 (2019: £6,789,000). A reduction in the average amortisation period by one year would
increase the amortisation expense for the year by £1,862,000 (2019: £1,218,000).

iv. Leases – determination of the appropriate rate to discount the lease payments

The Group uses its incremental borrowing rate as the discount rate for determining its lease liabilities at the lease commencement date
since the rate implicit in the lease cannot be readily determined. The calculation of the incremental borrowing rate involves estimation
and has been obtained from the Group’s bank to determine the rate on a lease-by-lease basis that the Group would have to pay to
borrow money to purchase the type of assets being leased. Rates applied are dependent on the entity leasing the asset and the
following factors have been considered:

• Lease term;
• Credit risk of the entity; and
• Level of indebtedness of the entity.

The impact of an increase in the incremental borrowing rates used for calculating the discount rate in determining the lease liabilities
for all entities on transition to IFRS 16 ‘Leases’ as at 1 October 2019 is set out below.

Estimate
Incremental
borrowing rate

Change
in estimate

1 percentage
point increase

Impact on
ROU assets
Reduce by

£3.2m

Impact on
lease liabilities
Reduce by

£2.3m

Impact on opening
retained reserves
Debit to retained reserves
increase by £0.9m

v. Defined benefit pension scheme

The calculation of the present value of the defined benefit pension scheme is determined by using actuarial valuations. Management
makes key assumptions in determining the inputs into the actuarial valuations, which may differ from actual experience in the future.
These assumptions are governed by IAS 19 Employee Benefits, and include the determination of the discount rate, life expectancies,
inflation rates and future salary increases. Due to the complexities in the valuation, the defined benefit pension scheme obligation is
highly sensitive to changes in these assumptions. The detailed assumptions, including a sensitivity analysis, are set out in note 18.

The defined benefit pension scheme has a surplus of £20,324,000 (2019: £17,373,000). See note 18 page 150 ‘Defined benefit
pension scheme asset recognition basis’ for further detail.

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vi. Share-based payments – Long Term Incentive Plan (‘LTIP’)

Awards are granted under the LTIP. The scheme includes performance-based vesting conditions, which impact the amount of benefit
paid, such as

• Average annual net inflows in discretionary funds; and
• Growth in adjusted diluted EPS over the performance period.

Assumptions are made on the likelihood of meeting certain average and stretch targets over the remaining service periods in
determining the expense in the year. The Directors consider that the LTIP is qualitatively material therefore this is highlighted as a key
source of estimation uncertainty. The charge for the year was £747,000 (2019: £415,000).

If all of the performance conditions were assumed to be met, the charge for the year would increase by £3,105,000 (2019: £1,576,000);
an increase of 10% in the vesting assumptions would increase the charge for the year by £443,000 (2019: £248,000).

Further information on the scheme is disclosed in note 31.

Income

Group

The following table presents revenue disaggregated by service and timing of revenue recognition:

Discretionary investment management fee income
Discretionary investment management commission income
Financial planning income
Execution only fee income
Execution only commission income1
Advisory investment management fee income
Advisory investment management commission income1
BPS2 investment management fee income
Expert witness report service1
Revenue
Other operating income
Income

1. Services transferred at a point in time.
2. Brewin Portfolio Service.

Services transferred at a point in time
Services transferred over time
Revenue

Contract balances

2020
£’000
237,617
70,033
33,079
4,611
6,684
3,633
1,066
1,335
1,106
359,164
2,283
361,447

2019
£’000
231,711
62,569
27,546
4,105
6,185
2,093
378
1,186
528
336,301
2,808
339,109

2020
£’000
8,856
350,308
359,164

2019
£’000
7,091
329,210
336,301

The Group does not have contract assets as it does not enter into contracts where revenue is conditional on the fulfilment
of a contingent event.

Contract liabilities

Contract liabilities relate to the advance consideration received from customers for services still to be delivered. The Group
derecognises contract liabilities (and recognises revenue) when it transfers services and satisfies its performance obligations
(see note 22).

Unsatisfied performance obligations

The Group does not have material unsatisfied (or partially unsatisfied) performance obligations at the reporting date, as the majority
of the Group’s performance obligations are satisfied equally over time.

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6. Segmental information

Group

The Group provides a wide range of wealth management services in the United Kingdom (‘UK’), Channel Islands (‘CI’) and the Republic
of Ireland (‘ROI’). The Group’s Executive Committee has been determined to be the chief operating decision maker for the purposes
of making decisions regarding the allocation of resources and assessing the performance of the identified segments.

For management reporting purposes the Group currently has a single operating segment: the Wealth Management business. This forms
the reportable segment of the Group for the period and consequently, the Group’s Consolidated Income Statement and Consolidated
Balance Sheet (these are set out on pages 115 and 117) are monitored by the Group’s Executive Committee. The accounting policies
of the operating segment are the same as those of the Group. All segmental income relates to external clients.

Following the acquisition of BDCIIL on 31 October 2019 (see note 35 for further details), the existing Irish business of the Group
expanded substantially and as a result the Irish business as a proportion of the Group is now larger, consequently geographical
disclosures are set out below.

Geographical information

For the year ended 30 September 2020

Segmental income statement

Revenue
Staff costs
Other operating costs

Amortisation of intangible assets – client relationships and brand
Acquisition costs
Onerous contracts
Incentivisation awards
Operating profit/(loss)
Finance income and costs
Profit/(loss) before tax
Tax
Profit/(loss) after tax

Segmental balance sheet

Net assets
Total assets
Total liabilities

UK & CI
business
£’000
338,098
(189,189)
(74,134)
74,775
(8,084)
–
(250)
(258)
66,183
(1,582)
64,601
(14,453)
50,148

UK & CI
business
£’000
284,386
612,866
328,480

ROI
business
£’000
23,349
(10,296)
(7,922)
5,131
(2,988)
(3,600)
–
(934)
(2,391)
(138)
(2,529)
336
(2,193)

ROI
business
£’000
50,650
59,832
9,182

Group
£’000
361,447
(199,485)
(82,056)
79,906
(11,072)
(3,600)
(250)
(1,192)
63,792
(1,720)
62,072
(14,117)
47,955

Group
£’000
335,036
672,698
337,662

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Staff costs

Group

The average monthly number of employees (including Executive Directors) by category was:
Client facing
Business support

The aggregate remuneration (including Executive Directors) comprised:
Wages and salaries
Social security costs
Share-based payments
Apprenticeship levy
Termination benefits – redundancy costs
Defined contribution pension scheme and death in service contributions

Company

The Company does not have any employees (2019: none).

8. Profit for the year

Group

Profit for the year has been arrived at after charging:

Depreciation of property, plant and equipment (see note 14)
Depreciation of right of use assets (see note 15)
Amortisation of intangible assets – client relationships (see note 13)
Amortisation of intangible assets – brand (see note 13)
Amortisation of intangible assets – software (see note 13)
Allowance for credit impaired assets for trade receivables (see note 19)
Expected credit loss allowance on trade debtors and accrued income (see note 19)
Staff costs (see note 7)
Auditor’s remuneration (see analysis below)

Analysis of auditor’s remuneration:

Audit services
Fees payable to the Company’s auditor for the audit of the Company’s annual accounts

Fees payable to the Company’s auditor for the audit of its subsidiaries

Assurance services
Regulatory assurance work payable to the Company’s auditor
Interim review
Other assurance services

Other non-audit services
AAF 01/06 – controls assurance report

Total auditor’s remuneration

2020
No.

1,229
882
2,111

2020
£’000

155,715
19,264
9,779
803
601
13,323
199,485

2019
No.

1,113
808
1,921

2019
£’000

146,966
17,406
7,769
660
759
11,336
184,896

2020
£’000
3,114
6,250
10,933
139
417
93
1
199,485
1,009

2019
£’000
2,823
–
6,789
69
1,105
6
8
184,896
850

2020
£’000

2019
£’000

466
560

182
79
55
316

133
133
1,009

397
478

177
56
28
261

111
111
850

Fees of £76,000 and £55,000 were paid to Ernst & Young in respect of the audit of fellow subsidiaries and regulatory assurance
work respectively.

Details of the Group’s policy on the use of the auditor for non-audit services are set out in the Audit Committee Report on page 78.

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Notes to the Financial Statements continued

9. Finance income and finance costs

Group

Finance income
Interest income on defined benefit pension scheme (see note 18)
Interest on lease receivables
Interest on bank deposits

Finance costs
Unwind of discounts on provisions (see note 24)
Unwind of discounts on shares to be issued
Interest expense on lease liabilities1
Interest on bank overdrafts

1. Following the adoption of IFRS 16 ‘Leases’ interest on lease liabilities is presented in finance costs.

10. Income tax expense

Group

Current tax
United Kingdom:

Charge for the year
Adjustments in respect of prior years

Overseas:

Charge for the year
Adjustments in respect of prior years

Total current tax

Deferred tax
United Kingdom:

Charge for the year
Adjustments in respect of prior years

Overseas:

Charge for the year
Adjustments in respect of prior years

Total deferred tax (see note 26)

Tax charged to the Income Statement

Finance Act 2020 maintained the UK statutory rate at 19% for years commencing 1 April 2020 and 1 April 2021.

Taxation for other jurisdictions is calculated at the relevant prevailing rates in the respective jurisdictions.

2020
£’000

324
92
491
907

210
70
2,327
20
2,627

2019
£’000

294
–
1,414
1,708

130
10
–
6
146

2020
£’000

2019
£’000

10,623
(1,174)

67
(70)
9,446

4,048
889

(266)
–
4,671

13,133
(151)

275
1
13,258

1,279
(80)

–
–
1,199

14,117

14,457

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Annual Report and Accounts 2020

The charge for the year can be reconciled to the profit per the Income Statement as follows:

Profit before tax
Tax at the UK corporation tax rate of 19% (2019: 19%)
Tax effect of:

Expenses that are not deductible in determining taxable profit
Leasehold property
Share-based payments
Over provision for tax in previous years
Lower rates in subsidiaries
Impact of deferred tax rate change

Tax expense for the year
Effective tax rate for the year

2020
£’000
62,072
11,794

1,275
163
1,098
(408)
142
53
14,117
22.7%

2019
£’000
62,524
11,880

2,687
46
285
(230)
(147)
(64)
14,457
23.1%

Expenses that are not deductible in determining taxable profit include amortisation of client relationships and brand, acquisition costs,
hospitality costs and professional fees that are capital in nature.

There are no material uncertainties within the calculation of corporation tax. The tax provisions are based on tax legislations in the
relevant jurisdictions and have not required any judgements or material estimates.

11. Dividends

Group and Company

Amounts recognised as distributions to equity shareholders in the year:

2019/18 Final dividend paid 12 February 2020, 12.0p per share (2019: 12.0p per share)
2020/19 Interim dividend paid 12 June 2020, 4.4p per share (2019: 4.4p per share)

2020
£’000

2019
£’000

35,401
12,992
48,393

33,009
12,977
45,986

Proposed final dividend for the year ended 30 September 2020 of 9.9p (2019: 12.0p) per share based
on shares in issue at 19 November 2020 (2019: 22 November 2019)

29,242

35,417

The proposed final dividend for the year ended 30 September 2020 of 9.9p per share is subject to approval by shareholders at the
Annual General Meeting and has not been included as a liability in these financial statements.

Under an arrangement dated 1 April 2011, Computershare Trustees (Jersey) Limited (the ‘Trustee’), holds 7,864,976 Ordinary Shares
representing 2.6% of the Company’s called up share capital in relation to employee share plans, has agreed to waive all dividends due
to the Trustee.

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Notes to the Financial Statements continued

12. Earnings per share

Group

The calculation of the basic and diluted earnings per share is based on the following data:

Number of shares
Basic
Weighted average number of shares in issue in the year
Diluted
Effect of weighted average number of options outstanding for the year
Diluted weighted average number of options and shares for the year
Adjusted1 diluted
Effect of full dilution of employee share options which are contingently issuable or have future
attributable service costs
Adjusted1 diluted weighted average number of options and shares for the year

Earnings attributable to ordinary shareholders
Profit for the purpose of basic and diluted earnings per share
Onerous contracts
Amortisation of intangible assets – client relationships and brand
Defined benefit pension scheme past service costs
Acquisition costs
Incentivisation awards
Other gains and losses

less tax effect of above

Adjusted profit for the purpose of basic and diluted earnings per share

Earnings per share
Basic
Diluted

Adjusted2 earnings per share
Basic
Adjusted1 diluted

2020
’000

2019
’000

295,012

282,718

6,110
301,122

6,630
289,348

3,664
304,786

3,344
292,692

£’000

47,955
250
11,072
–
3,600
1,192
–
(1,918)
62,151

48,067
996
6,858
1,909
2,337
340
(1)
(510)
59,996

16.3p
15.9p

17.0p
16.6p

21.1p
20.4p

21.2p
20.5p

1. The dilutive shares used for this measure differ from that used for statutory dilutive earnings per share; the future value of service costs attributable to employee
share options is ignored and contingently issuable shares for Long Term Incentive Plan (‘LTIP’) options are assumed to fully vest. The Directors have selected
this measure as it represents the underlying effective dilution by offsetting the impact to the calculation of basic shares of the purchase of shares by the Employee
Share Ownership Trust (‘ESOT’) to satisfy options.

2. Excluding onerous contracts costs, amortisation of client relationships and brand, acquisition costs, incentivisation awards, defined benefit pension scheme past

service costs and other gains and losses.

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13. Intangible assets

Group

Cost
At 30 September 2018

Additions
Exchange differences
At 30 September 2019

Additions
Exchange differences
At 30 September 2020

Accumulated amortisation and impairment losses
At 30 September 2018

Amortisation charge for the year
Exchange differences
At 30 September 2019

Amortisation charge for the year
Exchange differences
At 30 September 2020

Net book value
At 30 September 2020
At 30 September 2019
At 30 September 2018

Goodwill
£’000

Client
relationships
£’000

48,637
4,096
–
52,733
2,064
106
54,903

–
–
–
–
–
–
–

133,941
22,716
(1)
156,656
32,067
1,670
190,393

99,378
6,789
(1)
106,166
10,933
104
117,203

Brand
£’000

–
1,388
–
1,388
–
–
1,388

–
69
–
69
139
–
208

Software
costs
£’000

19,193
11,290
–
30,483
33,157
–
63,640

16,674
1,105
–
17,779
417
–
18,196

Total
£’000

201,771
39,490
(1)
241,260
67,288
1,776
310,324

116,052
7,963
(1)
124,014
11,489
104
135,607

54,903
52,733
48,637

73,190
50,490
34,563

1,180
1,319
–

45,444
12,704
2,519

174,717
117,246
85,719

Client relationship additions are made up as follows:

Cash paid for client relationships acquired in current year
Fair value adjustment
Cash paid for client relationships acquired in prior years
Deferred and contingent consideration in the form of cash for client relationships acquired
in the current year
Contingent consideration in the form of shares to be issued1 for client relationships acquired
in the current year
Total additions

2020
£’000
32,029
38
–

2019
£’000
11,944
–
11

–

7,103

–
32,067

3,658
22,716

1. Being the fair value of shares to be issued excluding the unwinding of discounting applied in the period, with this recognised as finance costs in the

Income Statement, see note 9.

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13. Intangible assets continued

Goodwill impairment testing

The tables below show the goodwill allocated to groups of cash-generating units (‘CGUs’) and the significant client relationship assets:

Midland Branch 1
Midland Branch 2
Northern Branch 1
South East Branch 1
BD Ireland
Other branches

Carrying amount at 30 September 2020

Brewin Dolphin Wealth Management Limited1
Brewin Dolphin Capital and Investments (Ireland) Limited2
BD Ireland
South East investment management team3
Bath branch4
Other investment management teams5
Carrying amount at 30 September 2020

Groups
of CGUs
No.
1
1
1
1
1
17
22

Goodwill
£’000
5,149
5,284
6,432
12,800
2,170
23,068
54,903

Intangible
assets – client
relationships
£’000
9,414
30,645
40,059
13,154
16,645
3,332
73,190

1. Amortisation period remaining 5 years 10 months.
2. Amortisation period remaining 9 years 1 month.
3. Amortisation period remaining 3 years 7 months.
4. Amortisation period remaining 8 years 10 months.
5. None of the constituent parts of the goodwill or client relationships relating to the other investment management teams is individually significant in comparison

to the total value of goodwill or client relationships respectively.

In accordance with IFRS, the Group performs impairment testing for goodwill on an annual basis, at 30 September, or more frequently
when there are impairment indicators. Client relationships and brand intangible assets are reviewed for indicators of impairment at each
reporting date.

The impairment review considered the COVID-19 pandemic as a potential indicator of impairment, consequently, the Group carried out
an exercise as set out in note 3bi. The key sources of estimation uncertainty in relation to the impairment of goodwill, client relationships
and brand are set out in note 4bii.

Goodwill impairment tests are performed for groups of CGUs at the branch level. Client relationships and brand impairment testing
is performed for each relevant CGU where there are indicators of impairment.

To determine whether an asset is impaired, the recoverable amount of the CGU is compared to its carrying amount. The recoverable
amount is the higher of the fair value less costs to dispose (‘FVLCTD’) and the value in use (‘VIU’).

The estimated FVLCTD for CGUs were based on a percentage of funds, where appropriate. The percentages applied are inherently
judgemental and were adjusted to reflect the downturn as a result of the COVID-19 pandemic. The estimated FVLCTD for CGUs are
therefore a level 3 measurement based on inputs which are unobservable to market participants.

The VIU for the CGUs were derived from a discounted cash flow calculation based on the Group’s Medium-Term Plan which reflects
recently observable trends, management expectations and expected future events, covering a five-year period. Cash flows beyond the
five-year period were extrapolated using long-term growth rates as estimated for all the CGUs.

Following our assessment, it was determined that none of the assets held by the Group were impaired.

The principal assumptions underlying the best estimated cash flow forecasts were as follows:

• Forecast cash flows and growth rates

Estimated future cash inflows were based on the Group’s Medium-Term Plan which took into consideration the impact of COVID-19.
Overall, it was assumed that fund flows would improve after 12 months and a growth rate reflecting the expected investment
performance per annum was used as the basis to determine likely revenue to be generated from the assets and took into
consideration the nature of the CGU. The estimated cash outflows allowed for inflation.

• Terminal value

A terminal value calculation was used to estimate the cash flows after year five using the long-term growth rate of the
UK economy of 2%.

• Discount rates

An adjusted discount rate of 8%-9.5% was applied to each CGU’s cash flows, this equates to the Group’s estimated weighted
average cost of capital (‘WACC’).

All of the CGUs within the Group have headroom, where the value in use calculation is in excess of the carrying value.

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Sensitivity analysis of the key assumptions

The value in use calculations are sensitive to the forecast assumptions applied to future cash flows and the discount rate applied.
The client relationships intangible asset that was recognised on the acquisition of Epoch was the most sensitive to the revenue growth
and discount rate assumptions used in the value in use calculations.

The value in use for the Bath CGU, calculated using a discount rate of 8%, would have to decrease by £5.5 million, for its recoverable
amount to be equal to the carrying amount.

The following analysis sets out the sensitivity and impact of changes in assumptions to the Bath CGU:

As at 30 September 2020

Change in assumption
Decrease in forecast operating cash inflows by a further 5%
Increase in discount rate by 1.5 percentage points

14. Property, plant and equipment

Group

Cost
At 30 September 2018

Additions
Exchange differences
Disposals

At 30 September 2019

Effect of change in accounting policy for initial application of IFRS 16
(see note 37)
At 1 October 2019

Additions
Exchange differences
Disposals

At 30 September 2020

Accumulated depreciation and impairment losses
At 30 September 2018
Charge for the year
Exchange differences
Eliminated on disposal

At 30 September 2019

Effect of change in accounting policy for initial application of IFRS 16
(see note 37)
At 1 October 2019

Charge for the year
Exchange differences
Eliminated on disposal
At 30 September 2020

Net book value
At 30 September 2020
At 30 September 2019
At 30 September 2018

Decrease in the
value in use of CGU
£’m
3.6
5.2

Leasehold
improvements
£’000

Office
equipment
£’000

Computer
equipment
£’000

11,905
325
(3)
–
12,227

–
12,227
483
13
(115)
12,608

11,395
231
(1)
–
11,625

–
11,625
293
6
(115)
11,809

34,939
1,066
–
–
36,005

–
36,005
701
–
(392)
36,314

31,225
1,428
–
–
32,653

–
32,653
1,621
–
(392)
33,882

Total
£’000

62,131
5,377
(6)
(23)
67,479

(992)
66,487
2,379
24
(958)
67,932

54,021
2,823
(1)
(23)
56,820

(775)
56,045
3,114
8
(958)
58,209

799
602
510

2,432
3,352
3,714

9,723
10,659
8,110

15,287
3,986
(3)
(23)
19,247

(992)
18,255
1,195
11
(451)
19,010

11,401
1,164
–
(23)
12,542

(775)
11,767
1,200
2
(451)
12,518

6,492
6,705
3,886

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Brewin Dolphin

145

Strategic ReportGovernanceFinancial StatementsOther Information

Notes to the Financial Statements continued

15. Leases

Group

With the exception of short-term leases and leases of low value underlying assets, each lease is reflected on the Consolidated Balance
Sheet as a ROU asset and a lease liability.

The Group’s ROU assets are in respect of leases for the offices it occupies. The leases generally have a term ranging from 5 to
15 years. There were four new leases in the year, one of the new leases replaced an expired lease. The leases require the Group
to keep the properties in a good state of repair and to return the offices in their original condition at the end of the lease. The average
lease term is 6.3 years.

Right of use assets

Cost
At 1 October 2019
Additions
Transfer to finance lease receivable
At 30 September 2020

Accumulated depreciation and impairment losses
At 1 October 2019
Charge for the year
At 30 September 2020

Net book value
At 30 September 2020
At 1 October 2019

Amounts recognised in the Income Statement

Depreciation expense on ROU assets
Interest expense on lease liabilities
Expenses relating to short-term leases
Expenses relating to low value assets
Income from subleasing ROU assets

Other information

Total
£’000

43,305
1,932
(945)
44,292

–
6,250
6,250

38,042
43,305

2020
£’000
6,250
2,327
653
25
572

At 30 September 2020, the Group was committed to short-term leases with a total commitment of £378,000.

The total cash outflow for leases recognised as right of use assets was £8,765,000 for the year ended 30 September 2020.

Finance lease receivables are presented in note 16 and lease liabilities including the maturity analysis of the lease liabilities are presented
in note 23.

The Group had not entered into any leases which are yet to commence at the end of the reporting period.

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16. Finance lease receivables

Group

Current
Non-current
Net investment in finance leases

Reconciliation of finance lease receivable:

At 30 September 2019
Initial application of IFRS 16 (see note 37)
At 1 October 2019
Non-cash:

Addition to ROU assets in exchange for increased lease liabilities (see note 15)
Unwind of discount (see note 9)

Cash:

Lease repayments received from tenants

At 30 September 2020

Finance lease arrangements

2020
£’000
167
1,966
2,133

2020
£’000
–
1,299
1,299

945
92

(203)
2,133

The Group has entered into various sub-lease arrangements as a lessor. The subleases relate to surplus office space that is leased
by the Group. Where the Group has transferred substantially all of the risk and rewards of ownership of the asset, the sub-leases are
classified as finance leases.

During the year, the finance lease receivable increased following the Group subletting surplus office space in its Cambridge office.

The Group does not face foreign currency risks, as the leases are denominated in the local currency of each subsidiary.

The maturity analysis of lease receivables, including the undiscounted lease payments to be received, are as follows:

12 months to 30 September 2021
12 months to 30 September 2022
12 months to 30 September 2023
12 months to 30 September 2024
12 months to 30 September 2025
From 1 October 2025 onwards
Total undiscounted lease payments receivable
Unearned finance income
Net investment in finance leases

2020
£’000
259
259
259
259
259
1,397
2,694
(561)
2,133

See note 9 for the amount recognised as finance income on the net investment in the finance leases.

The Group’s finance leases do not include variable payments.

Impairment of finance lease receivables

The Group estimates the loss allowance on finance lease receivables at an amount equal to the lifetime Expected Credit Loss (‘ECL’).
The lifetime ECL is determined to be £nil taking into account the historical default experience and future expectations. At the reporting
date none of the finance lease receivables are past due or impaired.

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Brewin Dolphin

147

Strategic ReportGovernanceFinancial StatementsOther InformationNotes to the Financial Statements continued

17. Investment in subsidiaries

The following are the Group’s subsidiary undertakings, all of which are owned 100% directly or indirectly by the Company and are
included in the consolidated financial statements:

Country of registration Class of share capital
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
England & Wales
England & Wales
England & Wales
England & Wales
Scotland
England & Wales
Jersey
England & Wales
England & Wales

Name of subsidiary
Argentum (Capvest) Ireland Limited4
Aurum Nominees Limited4
Aurum (Airtricity) Nominees Ireland Limited4
Aurum Broking Nominees Ireland Limited4
Aurum (Development) Nominees Ireland Limited4
Aurum (Placings) Ireland Limited4
Aurum (Thomas Street) Nominees No 2 Ireland Limited4
Aylwin Limited1
B.L.Nominees Limited1
BDDL Limited1
BDS Nominees Limited1
Bell Lawrie White & Co. Limited2
Brewin (1762) Limited1
Brewin 1762 Nominees (Channel Islands) Limited3
Brewin 1762 Nominees Limited1
Brewin Broking Limited1,5
Brewin Dolphin Capital & Investments (Ireland) Limited4
Brewin Dolphin (Channel Islands) Limited3
Brewin Dolphin Limited1,5
Brewin Dolphin MP1
Brewin Dolphin Securities Limited1
Brewin Nominees (Channel Islands) Limited3
Brewin Nominees Limited1
DDY Nominees Limited1
Dunlaw Nominees Limited1
Erskine Nominees Limited2
Giltspur Nominees Limited1
Mathieson Consulting Limited1
North Castle Street (Nominees) Limited2
Robert White & Co. Limited2,5
Shareline (Yorkshire) Limited1
Smittco Nominees Limited1
Brewin Dolphin Wealth Management Limited4,5
Tilman Brewin Dolphin Nominees Limited4
Webrich Limited1,5
Wise Nominees Limited1

Activity
Dormant Nominee
Dormant Nominee
Dormant Nominee
Dormant Nominee
Dormant Nominee
Dormant Nominee
Dormant Nominee
Investment Manager
Dormant Nominee
Investment Manager
Client Nominee
Dormant
Dormant
Dormant Nominee
Client Nominee
Dormant
Wealth & investment services Ireland
Jersey
Dormant
England & Wales
Investment Manager
England & Wales
Investment Manager
England & Wales
Dormant
Jersey
Client Nominee
England & Wales
Client Nominee
England & Wales
Dormant Nominee
England & Wales
Dormant Nominee
Scotland
Dormant Nominee
England & Wales
Client Nominee
England & Wales
Investment Manager
Scotland
Client Nominee
Scotland
Dormant
England & Wales
Dormant
England & Wales
Firm Nominee
Ireland
Investment Manager
Ireland
Client Nominee
England & Wales
Trustee
England & Wales
Dormant Nominee

Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary/A Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
A Ordinary/B Ordinary
Ordinary
Ordinary
Ordinary
A Ordinary/B Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary/A Shares
Ordinary
Ordinary
Ordinary A Voting/
Ordinary B Voting/
Ordinary C
Ordinary

Wise Speke Financial Services Limited1

Dormant

England & Wales

1. Registered office: 12 Smithfield Street, London, EC1A 9BD.
2. Registered office: Atria One, 144 Morrison Street, Edinburgh, EH3 8BR.
3. Registered office: 2nd Floor, Kingsgate House, 55 The Esplanade, St Helier JE2 3QB.
4. Registered office: 3 Richview Office Park, Clonskeagh, Dublin 14.
5. Indicates subsidiaries held directly.

All of the UK subsidiaries listed above are entitled to the exemption from audit under s479A of the Companies Act 2006, with the
exception of BDDL Limited, Brewin Dolphin Limited, Brewin Dolphin MP, Aylwin Limited and Mathieson Consulting Limited.

Company

At 1 October
Investment in Brewin Dolphin Wealth Management Limited
Capital contribution to Brewin Dolphin Limited in respect of share-based payments
Increase in investment in Brewin Dolphin Limited1
At 30 September

1. Due to shares to be issued.

2020
£’000
192,215
45,449
925
70
238,659

2019
£’000
188,491
–
56
3,668
192,215

148

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Annual Report and Accounts 2020

18. Defined benefit pension scheme

Group

The Group operates a registered Defined Contribution Scheme (the ‘Brewin Dolphin Senior Staff Pension Fund’) and a registered
Defined Benefit Scheme (the ‘Brewin Dolphin Limited RBS’) in the UK which both offer pensions in retirement and death benefits
to members. The disclosures provided are in respect of the Defined Benefit Scheme only (the ‘Scheme’).

The Scheme is an HMRC registered pension scheme and is subject to standard UK pensions and tax law. This means that the payment
of contributions and benefits are subject to the appropriate tax treatments and restrictions and the Scheme is subject to the scheme
funding requirements outlined in section 224 of the Pensions Act 2004.

The Scheme was established under trust and is governed by the Scheme’s Trust Deed and Rules. In accordance with UK trust and
pensions law, the Scheme has appointed Trustees. Although the Group bears the financial cost of the Scheme, the responsibility for the
management and governance of the Scheme lies with the Trustees, who have a duty to act in the best interest of members at all times.

Pension benefits are related to the members’ final salary at retirement and their length of service. The pension is payable for life and has
elements increasing in payment in line with inflation up to a maximum of 5% per annum. Since 1 April 2003 the Scheme has been
closed to new members. Members under age 55 at 1 April 2004 ceased to accrue further service in the Scheme from that date.
There is no future benefit accrual since all in-service members have retired. Contributions to the Scheme for the year beginning
1 October 2020 are expected to be £312,500.

Valuation for funding purposes

The valuation as at 31 December 2017:

Value of scheme assets

Actuarial value of scheme liabilities in respect of:

In-service members
Deferred pensioners
Current pensioners and dependants

Value of scheme liabilities
Scheme surplus
Funding level

£’000
110,335

(14,813)
(38,852)
(49,473)
(103,138)
7,197
107%

The Scheme is valued for funding purposes at intervals of not more than three years by an independent qualified actuary. The latest
valuation for funding purposes was as at 31 December 2017. The actuarial valuation is used to assess the money the Group needs
to put into the pension scheme.

The Scheme was in deficit measured on the Scheme’s funding basis as at 31 December 2014, the 2014 funding valuation. As a result,
the Group agreed to pay additional contributions into the Scheme following the 2014 funding valuation and this resulted in a scheme
surplus at the latest funding valuation as at 31 December 2017, ahead of expectations.

As part of the latest valuation, it was agreed that the Scheme would de-risk its investment strategy and the Group would continue
to pay contributions of £250,000 per month from 1 January 2018 until 28 February 2019 (as was previously agreed following the
2014 valuation to eliminate the deficit at that time). In addition to this, the Group has also agreed to pay additional contributions
of £1.25 million per annum from 1 March 2019 to 31 December 2020 so that the Scheme may continue to de-risk and lock in the
funding needed to pay out all future benefits in combination with a lower risk investment strategy.

The next actuarial valuation of the Scheme is due as at 31 December 2020, where the funding position of the Scheme will be reviewed.
The administration costs of the Scheme, including investment management fees and Scheme levy payments are currently paid by
Brewin Dolphin Limited as they fall due.

Maturity of the Scheme

The liabilities of the Scheme are based on the current value of expected benefit payment cash flows to members of the Scheme over
the next 60 years or so. The average duration of the liabilities is approximately eighteen years.

Summary of amounts recognised in the financial statements under IAS 19

In the consolidated financial statements, the Group accounts for pension costs, other post-retirement benefits and related redundancy
provisions in accordance with IAS 19 – ‘Employee Benefits’. Under the standard, the difference between the market values of Scheme
assets and the present value of Scheme liabilities is reported as a surplus (asset) (to the extent a surplus may be seen) or deficit (liability)
on the Balance Sheet. The accounting value shown on the Balance Sheet will always be different from the result obtained using the
funding basis.

The pension valuation under IAS 19 as at 30 September 2020 was carried out by a qualified independent actuary.

In the preparation of the valuations under IAS 19 referred to in this note, the actuary has used the assumptions indicated below,
which the Group has directed for the purposes of accounting and disclosure under IAS 19.

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Brewin Dolphin

149

Strategic ReportGovernanceFinancial StatementsOther Information

Notes to the Financial Statements continued

18. Defined benefit pension scheme continued

Amount, timing and uncertainty of future Scheme cash flows

A sensitivity analysis of the principal assumptions used to measure the Scheme’s defined benefit obligation as at 30 September 2020
is set out further below. The sensitivities cover the key assumptions shown. The inflation assumption sensitivity factors in the impact
of changes to RPI inflation which will impact on future expectations of increases in final pensionable salary (which are capped at RPI
increases), pension increases and CPI inflation.

Explanation of the variance between funding valuation and IAS 19 valuation

The accounts show the Scheme has a surplus of £20.3 million under IAS 19 as at 30 September 2020 compared to the surplus
of £7.2 million revealed by the last funding valuation as at 31 December 2017. The main reason for the difference in surplus is due
to the different assumptions used to value the liabilities in the accounting and funding valuations for the Scheme, the funding valuation
uses more cautious assumptions to value the liabilities while the accounting assumptions are derived in line with IAS 19.

Defined benefit pension scheme asset recognition basis

Under IAS 19 the net defined benefit pension scheme asset that can be recognised is the lower of the surplus and the asset ceiling
(i.e. the economic benefits available in the form of refunds or reductions in future contributions or a combination of both, in accordance
with IFRIC 14 ‘IAS 19—The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction’). Under the
Scheme’s Trust Deeds and Rules the Group is able, without condition or restriction placed on it by the Trustees, to run the Scheme
until the last member dies, without benefits being augmented; wind up the Scheme at that point; and reclaim any remaining monies.
Consequently, the Group recognises the full surplus calculated in accordance with IAS 19 and IFRIC 14.

Risks

The main risks to which the Group is exposed in relation to the pension scheme are:

Mortality risk – the assumptions adopted by the Group make allowance for future improvements in life expectancy.
However, if life expectancy improves at a faster rate than assumed, this would result in greater payments from the Scheme and
consequently increases in the Scheme’s liabilities. The Group and the Scheme’s Trustees review the mortality assumption on a regular
basis to minimise this risk.

Investment risk – the Scheme invests its assets in a diversified portfolio of assets. There are risks that the assets underperform
relative to increases in the value of the Scheme’s liabilities increasing the cost to the Group of the benefit provision. There is a risk that
the assets invested in do not sufficiently match the characteristics of the Scheme’s liabilities and so a fall in asset values is not similarly
matched by a fall in the value of the liabilities. While certain assets are chosen that match the characteristics of the Scheme’s liabilities
and membership profile, the Scheme currently invests in a proportion of equity and assets that are not expected to closely match the
majority of the Scheme’s liabilities. The Scheme invests in derivatives, predominantly interest rate and inflation rate swaps that are used
to provide a liability matching overlay so that the value of these swaps and the gilts held match the majority of the movement in the
liabilities to changes in interest rates and inflation. The Scheme’s Trustees review the performance of the assets and structure of the
portfolio on a regular basis to ensure the risks being taken under investment are commensurate with normal Trustees’ principles and the
ability of the Group to mitigate adverse investment experience.

Price inflation risk – some of the Scheme’s benefits increase in line with price inflation and so if inflation is greater than expected,
the costs of providing these benefits will increase. The Scheme holds government bonds with payments also linked to inflation to assist
in mitigating this risk.

Financial derivatives risk – the Scheme directly holds derivatives in the form of interest rate swaps, inflation swaps and total return
swaps with the aim of enhancing how the Trustees’ matching assets match changes in the Scheme’s liabilities on the funding basis.
These are managed by the investment manager as well as all other assets and the Scheme Trustees determine the level of overall
liability hedging that is employed. Other than these derivatives used for liability matching and reducing risks, the Scheme does not
directly hold any financial derivatives, but these may be held by some of the investment funds that the Scheme invests in. The main
risks associated with financial derivatives include: losses may exceed the initial margin; counterparty risk where the other party defaults
on the contract; and liquidity risk where it may be difficult to close out a contract prior to expiry. These risks are managed indirectly
by the investment managers of the Scheme who will review the Scheme’s return seeking assets and the level of investment risk taking
to ensure it remains appropriate taking account of the Trustees’ investment objectives.

The surplus recognised on the accounting basis is exposed to the risks that increases or decreases in the assets do not match those
of the liabilities measured on the accounting basis. The asset liability matching is based on the Scheme’s funding basis and so to the
extent that the Group’s measure for the liabilities in line with IAS 19 requirements changes relative to the measure of the liabilities on the
funding basis which the assets are hedging, this could impact on the accounting surplus. The funding position on the funding basis
is protected to some degree by the level of hedging that is adopted and the Trustees’ plans to de-risk in future years as the funding
position improves.

Scheme investment strategy and level of matching

The Scheme recently de-risked its investment strategy upon meeting a secondary funding level target. The Scheme’s investment
strategy is currently to invest broadly 30% in higher return seeking assets “assets on risk” (e.g. equities, high yielding bonds etc.),
20% in a cash flow generating corporate bond fund and 50% in matching assets (e.g. fixed interest gilts and index-linked gilts).
The objective is to target an investment return of 1.1% per annum (net of fees) in excess of a portfolio of gilts that closely matches the
behaviour of the Scheme’s liabilities, falling to 0.5% per annum (net of fees) as the proportion of pensioner members increases to 100%.
The Scheme also has a liability matching overlay to mirror the majority of the movement in the matching portfolio. This strategy reflects

150

Brewin Dolphin

Annual Report and Accounts 2020

the Scheme’s liability profile and the Trustees’ and Group’s attitude to risk. The asset allocations as at 30 September 2020
and 30 September 2019 are provided below, disaggregated between assets that are believed to have a quoted market price
in an active market.

The Scheme was hedged up to 100% of interest rate risk and inflation risk as at 30 September 2020 to reduce financial risks to the
Scheme and the risks of additional contribution requirements for the Group. The current longer-term objective is to continue to hedge
around 100% of both the interest rate risk and inflation risk of the liabilities; this will help to further reduce funding level volatility.

None of the assets of the pension schemes are invested in the Group’s own financial instruments and none of the assets are properties
or other assets used by the Group.

Assumptions

A full actuarial valuation of the Scheme was carried out as at 31 December 2017 and has been updated to 30 September 2020
by a qualified independent actuary.

The major assumptions used by the actuary were (in nominal terms) as follows:

Discount rate
RPI inflation assumption
CPI inflation assumption
Rate of increase in salaries
LPI pension increases

Average assumed life expectancies for members on retirement at age 65.
Retiring today:

Males
Females

Retiring in 20 years:

Males
Females

Scheme assets and liabilities

The assets in the Scheme were:

Equities and property (quoted)
Fixed interest bonds (quoted)
Index linked bonds (quoted)
Liability hedging (quoted)
Commodities (quoted)
Currency hedging (quoted)
Alternatives (quoted)
Cash and cash equivalents
Fair value of scheme assets

Net asset recognised on the Balance Sheet:

Present value of funded obligations
Fair value of scheme assets
Surplus in funded scheme and net asset on the Balance Sheet

Reconciliation of opening and closing balances of the present value of the defined benefit obligation:

Benefit obligation at beginning of year
Past service cost1
Interest cost
Net remeasurement gains – demographic
Net remeasurement losses/(gains) – financial
Net remeasurement (gains)/losses – experience
Benefits paid
Benefit obligation at end of year

1. The past service cost relates to the equalisation of the Guaranteed Minimum Pensions (‘GMP’).

www.brewin.co.uk

As at
30 September

2020
1.50%
2.90%
2.20%
2.90%
2.85%

2019
1.80%
3.10%
2.10%
3.10%
3.00%

86.9 years
89.2 years

88.2 years
90.7 years

88.3 years
90.7 years

2020
£’000
22,073
48,293
40,040
4,559
986
78
7,116
2,934
126,079

2019
£’000
36,189
30,978
29,505
7,188
–
(100)
13,007
8,468
125,235

2020
£’000
(105,755)
126,079
20,324

2019
£’000
(107,862)
125,235
17,373

2020
£’000
107,862
–
1,913
(4,247)
3,993
(567)
(3,199)
105,755

2019
£’000
95,470
1,909
2,673
(4,916)
16,834
(242)
(3,866)
107,862

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151

Strategic ReportGovernanceFinancial StatementsOther InformationNotes to the Financial Statements continued

18. Defined benefit pension scheme continued

Reconciliation of opening and closing balances of the fair value of plan assets:

Fair value of plan assets at beginning of year
Interest income on scheme assets
Return on assets, excluding interest income
Contributions by employers
Benefits paid
Fair value of scheme assets at end of year

The amounts recognised in the Income Statement are:

Past service cost
Net interest income on the net defined benefit asset
Total income/(expense)

Remeasurements of the net defined benefit asset included in Other Comprehensive Income (‘OCI’):

Net remeasurement – demographic
Net remeasurement – financial
Net remeasurement – experience
Return on assets, excluding interest income
Total remeasurement of the net defined benefit asset included in OCI

Sensitivity analysis

2020
£’000
125,235
2,237
556
1,250
(3,199)
126,079

2020
£’000
–
324
324

2020
£’000
4,247
(3,993)
567
556
1,377

2019
£’000
106,878
2,967
17,277
1,979
(3,866)
125,235

2019
£’000
(1,909)
294
(1,615)

2019
£’000
4,916
(16,834)
242
17,277
5,601

It should be noted that the methodology and assumptions prescribed for the purposes of IAS 19 mean that the disclosures will be
inherently volatile, varying greatly according to investment market conditions at each accounting date.

A sensitivity analysis of the principal assumptions used to measure the defined benefit pension scheme as at 30 September 2020 is set
out below.

Assumption
Rate of inflation (RPI, CPI,
inflation linked pension increases
and salary increases)
Assumed life expectancy
Discount rate
Credit spread (difference
between discount rate and
underlying gilt yields)
Credit spread (difference
between discount rate and
underlying gilt yields)
Underlying gilt yields
Underlying gilt yields
Value of assets on risk
Value of assets on risk

Change in assumption
Increase by 0.25%

Impact on scheme liabilities Impact on scheme assets
Increase by £3.7m

Increase by £4.5m

Impact on scheme surplus
Increase by £0.8m

Members live 1 year longer
Decrease by 0.25%
Decrease by 0.25% pa

Increase by £5.2m
Increase by £5.0m
Increase by £5.0m

£ nil
Increase by £6.0m
Increase by £0.4m

Decrease by £5.2m
Increase by £1.0m
Decrease by £4.6m

Increase by 0.25% pa

Decrease by £4.7m

Decrease by £0.4m

Increase by £4.3m

Decrease by 1% pa
Increase by 1% pa
Decrease by 10%
Decrease by 20%

Increase by £22.4m
Increase by £4.4m
Increase by £26.8m
Decrease by £17.0m Decrease by £20.9m Decrease by £3.9m
Decrease by £3.9m
Decrease by £3.9m
n/a
Decrease by £7.8m
Decrease by £7.8m
n/a

The average duration of the pension scheme liabilities is in the region of eighteen years.

The sensitivity figures have been calculated using the same method used for the calculation of the disclosed liabilities as at
30 September 2020. There are no material limitations of the method used to calculate the sensitivities relative to the disclosed liabilities.

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19. Trade and other receivables

Group

Non-current assets
Other receivables
Other receivables at 30 September
Effect of change in accounting policy for initial application of IFRS 16
Other receivables at 1 October

Current assets
Trade debtors
Loss allowance

Loans1
Accrued income
Other debtors
Prepayments
Trade and other receivables at 30 September
Effect of change in accounting policy for initial application of IFRS 16
Trade and other receivables at 1 October

1. All loans are to staff and the Directors believe that the balances are fully recoverable.

2020
£’000

931
931
n/a
n/a

2020
£’000

169,054
(333)
168,721
76
64,714
1,676
6,752
241,939
n/a
n/a

2019
£’000

–
–
688
688

2019
£’000

143,135
(43)
143,092
280
61,770
1,352
9,718
216,212
(1,371)
214,841

Trade debtors relate to either market or client transactions and are considered to be past due once the date for settlement has passed.
The date for settlement is determined when the trade is booked. It is expected that some transactions may become past due in the
normal course of business. Fees owed by clients are considered to be past due when they remain unpaid after 30 days after the
relevant billing date. An allowance for credit impaired assets is recognised for trade debtors that are older than 90 days unless collateral
is held. The maximum exposure to credit risk is the carrying value as above (see note 30 for details of the Group’s credit risk).

The expected credit losses have been determined under the simplified approach and accordingly the loss allowance recognised
is based on lifetime expected credit losses at each reporting date.

Ageing of past due but not impaired trade debtors

Not past due
Up to 15 days past due
16 to 30 days past due
31 to 45 days past due
More than 45 days past due

Individually impaired trade debtors

Individually impaired trade debtors
Loss allowance

Trade debtors

Movements in loss allowance

At 1 October
On acquisition
Exchange rate movement
Net charge to the Income Statement
Loss allowance utilised
At 30 September

2020
£’000
166,828
1,518
38
94
184
168,662

2020
£’000
392
(333)
59

2019
£’000
141,762
995
81
23
95
142,956

2019
£’000
179
(43)
136

168,721

143,092

Credit
impaired
assets
allowance
£’000
35
307
16
93
(127)
324

Expected
credit loss
allowance
£’000
8
–
–
1
–
9

2020
£’000
43
307
16
94
(127)
333

2019
£’000
29
–
–
14
–
43

No other financial assets of the Group or the Company, other than doubtful debts, are impaired.

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Notes to the Financial Statements continued

19. Trade and other receivables continued

Company

Current assets
Amounts due from subsidiary undertakings
Trade and other receivables

20. Financial instruments

Group

Financial assets at fair value through profit and loss (‘FVTPL’)

Level 1

Listed investments
Financial assets at FVTPL

2020
£’000

2019
£’000

35,042
35,042

38,967
38,967

2020
£’000
379
379

2019
£’000
373
373

The fair value of financial assets at FVTPL is determined directly by reference to published prices in an active market where available.
They are held in an unregulated subsidiary, Brewin Dolphin MP, whose sole objective is to provide seed capital to the model portfolios
managed under an investment mandate by Brewin Dolphin Limited. See note 30 for details of financial instruments risk management.

Financial assets at fair value through other comprehensive income (‘FVTOCI’)

Level 3

At 30 September 2018

Net gain from changes in fair value recognised in equity
Disposals

At 30 September 2019

Net loss from changes in fair value recognised in equity
Disposals

At 30 September 2020

Equity
Financial assets at FVTOCI

21. Cash and cash equivalents

Group

Cash and cash equivalents

Company

Cash and cash equivalents

Unlisted
investments
£’000
676
1
(598)
79
(5)
(6)
68

2019
£’000
79
79

2020
£’000
68
68

2020
£’000
180,533

2019
£’000
229,199

2020
£’000
1,256

2019
£’000
47,000

Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months or less. The carrying
amount of these assets is approximately equal to their fair value.

Cash and cash equivalents at the end of the reporting period as shown in the Consolidated Statement of Cash Flows can be reconciled
to the related items in the Consolidated Balance Sheet as shown above.

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22. Trade and other payables

Group

Current liabilities
Trade creditors
Other creditors
Other taxes and social security
Accruals
Deferred income
Contract liabilities
Trade and other payables at 30 September
Effect of change in accounting policy for initial application of IFRS 16
Trade and other payables at 1 October

Non-current liabilities
Other creditors
Trade and other payables at 30 September

2020
£’000

2019
£’000

167,178
1,780
12,270
72,860
1,757
191
256,036
n/a
n/a

2020
£’000

459
459

141,523
2,159
10,547
66,653
–
39
220,921
(3,039)
217,882

2019
£’000

832
832

Trade creditors relate to either market or client transactions; the date for settlement is determined when the trade is booked.

Company

Current liabilities
Accruals
Deferred income
Amounts payable to subsidiary undertakings
Trade and other payables at 30 September

23. Lease liabilities

Group

Current
Non-current
Lease liabilities

Maturity analysis of lease payments:

2020
£’000

2019
£’000

–
5,085
7,334
12,419

154
5,551
7,334
13,039

2020
£’000
8,316
45,265
53,581

2020
£’000
10,216
9,261
8,095
7,788
7,617
20,300
63,277
(9,696)
53,581

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23. Lease liabilities continued

Reconciliation of lease liability:

At 30 September 2019
Initial application of IFRS 16 (see note 37)
At 1 October 2019
Non-cash:

Addition to ROU assets in exchange for increased lease liabilities
Unwind of discount

Cash:

Repayments

At 30 September 2020

The Group does not face a significant liquidity risk from its lease liabilities.

Lease payments not recognised as a liability are presented in note 32 operating lease arrangements.

2020
£’000
–
57,784
57,784

2,235
2,327

(8,765)
53,581

24. Provisions

Group

Effect
of change
in accounting
policy for initial
application of
IFRS 16
(see note 37)
£’000
–
(3,607)
–
–
–
(298)

At 1
October
2019
£’000
338
1,233
3,021
854
7,888
2,044
(3,905) 15,378

Non-current
Total
liability
£’000
£’000
397
–
1,382
1,014
2,805
1,733
1,420
1,420
6,587
3,738
2,051
2,163
9,956 14,754

At 30
September
2019
£’000
338
4,840
3,021
854
7,888
2,342
19,283

Current
liability
£’000
397
368
1,072
–
2,849
112
4,798

Sundry claims and associated costs
Onerous contracts
Social security and levies on share awards
Incentivisation awards
Deferred and/or contingent consideration
Leasehold dilapidations

Sundry claims and associated costs
Onerous contracts
Social security and levies on share awards
Incentivisation awards
Deferred and/or contingent consideration
Leasehold dilapidations
At 30 September 2020

Additions
£’000
299
329
974
1,223
–
255
3,080

Utilisation
of provision
£’000
(17)
(191)
(1,068)
(671)
(1,367)
(100)
(3,414)

Unwinding
of discount
£’000
–
42
–
14
108
46
210

Unused
amounts
reversed

£’000
(223)
(31)
(122)
–
(42)
(82)
(500)

At 30
September
2020
£’000
397
1,382
2,805
1,420
6,587
2,163
14,754

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The Group recognises provisions for the following:

Sundry claims and associated costs

The timing of the settlements is unknown, but it is expected that they will be resolved within 12 months.

Onerous contracts

The provision is in respect of surplus office space costs except for rent which is accounted for under IFRS 16.

The valuation of an onerous contract is based on the best estimate of the likely costs discounted to present value. Where the provision
is in relation to leasehold obligations on premises and it is more likely than not that the premises will be sublet, an allowance for
recoverable costs such as service charges from the subtenant has been included in the valuation. The longest lease term has 12.5
years remaining.

Social security and levies on share awards

The provision is in respect of Employer’s National Insurance and Apprenticeship Levy on share awards outstanding at the end of the
year. The provision is based on the Group’s share price, the amount of time passed and likelihood of the share awards vesting and
represents the best estimate of the expected future cost.

Incentivisation awards

The provision is in respect of incentivisation awards that are payable to employees in relation to the retention and acquisition of funds
and is based on the best estimate of the likely future obligation discounted for the time value of money.

Deferred and/or contingent consideration

The provision is for deferred and/or contingent consideration relating to the acquisition of both subsidiaries and asset purchases.
It is based on the best estimate of the likely future obligation discounted for the time value of money.

Leasehold dilapidations

The provision is in respect of the expected dilapidated costs that will arise at the end of the lease. The leases covered by the provision
have a maximum remaining term of 12.5 years.

25. Shares to be issued

Group and Company

Brewin Dolphin Limited, the Group’s principal operating subsidiary, acquired the assets and staff of Epoch Wealth Management LLP
in August 2019. There are contingent considerations that will be settled in both cash and the Company’s shares, upon satisfaction
of the performance conditions. The first contingent consideration is payable at the end of a twelve-month performance period to
30 September 2022; the measurement of performance can be delayed under certain circumstances by the seller.

The second contingent consideration, if payable, will be settled in both cash and the Company’s shares at the end
of 30 September 2024 if performance conditions are met. As at 30 September 2020, it is not expected that this contingent
consideration will be payable, therefore it has been estimated as £nil (2019: £nil).

The table below reconciles the movement in the shares to be issued:

At 1 October
On acquisition in the period
Unwind of discount charged to the income statement (see note 9)
At 30 September

2020
£’000
3,668
–
70
3,738

2019
£’000
–
3,658
10
3,668

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26. Net deferred tax liability

In addition to the amount debited to the Income Statement, deferred tax relating to the actuarial gain in the defined benefit pension
scheme amounting to £609,000 has been debited to other comprehensive income (2019: £945,000 debited to other comprehensive
income relating to the actuarial gain). Deferred tax on share-based payments of £252,000 has been debited to profit and loss reserves
(2019: £600,000 debited to profit and loss reserves).

The following are the major deferred tax assets/(liabilities) recognised by the Group and movements thereon during the current and prior
reporting year:

Group

At 30 September 2018
Additions
Charge in the year to the Income Statement
Charge in the year to the Statement
of Comprehensive Income
Charge in the year to the Statement
of Changes in Equity
At 30 September 2019
Effect of change in accounting policy for
initial application of IFRS 16 (see note 37)
At 1 October 2019
Acquired on acquisition of subsidiary
Additions
Exchange rate movement
(Charge)/credit in the year to the
Income Statement
Charge in the year to the Statement
of Comprehensive Income
Charge in the year to the Statement
of Changes in Equity
At 30 September 2020

Capital
allowances

Revaluation

£’000
1,268
–
(304)

£’000
(1)
–
–

Other
short-term
timing
differences

£’000
927
–
(99)

Defined
pension
benefit
scheme
£’000
(1,939)
–
(69)

Share-based
payments

£’000
4,616
–
(313)

Incentivisation
awards
£’000
95
–
(64)

Intangible
asset
amortisation

£’000
(825)
(4,096)
(350)

Total
£’000
4,141
(4,096)
(1,199)

–

–
964

–
964
–
–
–

(107)

–

–
857

–

–
(1)

–
(1)
–
–
–

–

–
(1)

–

(945)

–

–
828

–
(2,953)

1,323
–
2,151 (2,953)
–
1,930
–
–
–
101

(600)
3,703

–
3,703
–
–
–

–

–
31

–
31
–
–
–

–

(945)

–
(5,271)

(600)
(2,699)

–
(5,271)
–
(4,008)
(209)

1,323
(1,376)
1,930
(4,008)
(108)

(63)

(299)

(211)

(4,046)

(4,671)

–

(609)

–

–
4,119 (3,861)

(252)
3,240

–

–
86

–

(609)

–
(13,534)

(252)
(9,094)

Deferred income taxes are calculated using substantially enacted rates of UK corporate tax expected to be in force at the time assets
are realised; all deferred income taxes are expected to be realised at 19%.

27. Share capital

Group and Company

Authorised:
Ordinary shares of 1p each

Allotted, issued and fully paid:
Ordinary shares of 1p each

2020
No.

2019
No.

2020
£’000

2019
£’000

500,000,000 500,000,000

5,000

303,234,190 303,171,134

3,032

During the year the following shares were issued:

At 1 October 2019
Issue of options
At 30 September 2020

Date

Various

No. of shares
303,171,134
63,056
303,234,190

Exercise/
issue price
(pence)

131.3p – 165.7p

Share
capital
£’000
3,032
–
3,032

Share premium
account
£’000
58,238
102
58,340

Total
£’000
61,270
102
61,372

The rights and obligations attached to the ordinary shares of 1 penny each in the Company are as follows:

• In terms of voting every member who is present in person or by proxy at a general meeting of the Company shall have one vote

on a show of hands and one vote for every share held on a poll.

• As regards dividends, all shares in issue at the year end rank pari passu for dividends. Shareholders shall be entitled to receive

dividends following declaration by the Company. Dividends are not payable in respect of any nil paid shares that may be held by the
Trustees in Brewin Dolphin Holdings PLC Employee Share Ownership Trust (the ‘Trust’).

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• The Trustees of the Brewin Dolphin Holdings PLC Employee Share Ownership Trust have agreed to waive all dividends due on the

shares held in the Trust, 7,864,976 ordinary shares as at 30 September 2020 (2019: 8,047,595).

• There are no special rights for the ordinary shares in relation to control of the Company.

On a change of control, the following criteria will apply:

• 2004 Approved Share Option Schemes: Options can be exercised within 30 days of control being obtained. The options will lapse

after six months.

• Long Term Incentive Plan: Awards will automatically vest upon change of control and options will become exercisable from the date

of change of control and will remain exercisable for one month, after which the options will lapse.

• Deferred Profit Share Plan: A replacement award could be made over shares in the acquiring company, otherwise the shares will vest

in full and can be exercised within six months of control being obtained.

• Share Incentive Plan: No Matching Shares shall be forfeited as a consequence of a change of control.
• Equity Award Plan: Awards will automatically vest upon change of control and options will become exercisable from the date

of change of control and will remain exercisable for one month, after which the options will lapse.

The following options and awards have been granted and remain outstanding:

Scheme
2004 Approved Share Option Scheme:

Deferred Profit Share Plan1:

Equity Award Plan1:

Long-term Incentive Plan2:

Share Award Agreement1

Grant date

December 2009
December 2010
December 2011

December 2013
December 2014
December 2015
December 2016
December 2017
December 2018
December 2019

February 2017
August 2017
May 2018
December 2018
January 2019
March 2019
June 2019
December 2019
January 2020
June 2020

December 2016
December 2017
December 2018
December 2019

March 2019

Exercise
price

165.7p
148p
131.3p

Nil
Nil
Nil
Nil
Nil
Nil
Nil

Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil

Nil
Nil
Nil
Nil

Nil

2020
No.

2019
No.

–
31,004
14,750
45,754

–
70,689
168,018
339,521
1,967,162
2,353,271
2,222,172
7,120,833

–
–
3,032
109,441
19,586
–
1,865
113,165
28,344
5,603
281,036

50,503
42,807
15,500
108,810

38,374
99,718
361,631
1,900,619
2,053,963
2,478,216
–
6,932,521

47,908
6,422
3,032
109,441
22,608
64,143
4,138
–
–
–
257,692

–
725,640
830,849
973,255
2,529,744

1,029,938
806,692
978,243
–
2,814,873

85,375
85,375

148,790
148,790

Total options and awards outstanding as at 30 September

10,062,742 10,262,686

1. These options do not count towards dilution limits because the shares have been purchased in the market by the Brewin Dolphin Holdings PLC Employee Share

Ownership Trust.

2. These options may be purchased in the market by the Brewin Dolphin Holdings PLC Employee Share Ownership Trust in these circumstances they do not count

towards dilution limits.

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28. Own shares

Group and Company

The own shares reserve represents the matching shares purchased in the market and held by the Brewin Dolphin Share Incentive Plan
and shares purchased by the Brewin Dolphin Holdings PLC Employee Share Ownership Trust (‘ESOT’).

Balance at 30 September 2018

Acquired in the year
Own shares disposed of on exercise of options

Balance at 30 September 2019

Acquired in the year
Own shares disposed of on exercise of options

Balance at 30 September 2020

Shares held by:

Brewin Dolphin Holdings PLC ESOT
Brewin Dolphin Share Incentive Plan

Balance at 30 September

29. Other reserves

Merger reserve

No. of shares
8,647,912
2,689,230
(3,131,166)
8,205,976
2,447,888
(2,607,208)
8,046,656

2020
No.

£’000
26,060
8,898
(9,744)
25,214
8,388
(8,364)
25,238

2019
No.

7,864,976
181,680
8,046,656

8,047,595
158,381
8,205,976

The merger reserve is used where more than 90% of the share capital in a subsidiary is acquired and the consideration includes the
issue of new shares by the Company, thereby attracting merger relief under Section 612 of the Companies Act 2006. £38.4 million
of the merger reserve arose on a placing of the Company’s shares and forms part of the distributable reserves.

Group

Balance at 30 September 2019
Balance at 30 September 2020

Company

Balance at 30 September 2019
Balance at 30 September 2020

Profit and loss account

£’000
70,553
70,553

£’000
70,838
70,838

The profit and loss reserve forms part of distributable reserves, subject to the profits being realised, £124.8 million of the reserve
is distributable.

Company

Balance at 30 September 2019
Balance at 30 September 2020

£’000
154,605
151,852

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Annual Report and Accounts 2020

Revaluation reserve

The revaluation reserve represents the cumulative fair value movements on FVTOCI financial instruments recognised in other
comprehensive income and does not form part of distributable reserves.

Group

Balance at 30 September 2019
Balance at 30 September 2020

Hedging reserve

£’000
3
(2)

The hedging reserve represents the cumulative fair value movements on FVTOCI financial derivatives recognised in other comprehensive
income and does not form part of distributable reserves.

Group

Balance at 30 September 2019
Balance at 30 September 2020

Company

Balance at 30 September 2019
Balance at 30 September 2020

30. Risk management

Overview

£’000
(24)
–

£’000
(24)
(24)

This note presents information about the Group’s exposure to each of the key risks (market risk, credit risk and liquidity risk) arising from
the use of financial instruments, the Group’s policy and procedures for measuring and managing risk and the Group’s management
of capital.

Risk management

The Board of Directors has overall responsibility for establishing and overseeing the Group’s Risk Management Framework and
risk appetite.

The Board has established a clear relationship between the Group’s strategic objectives and its willingness to take risk through
a Risk Appetite Statement. The Risk Appetite Statement is an expression of limits (qualitative and/or quantitative) giving clear guidance
on the nature and quantum of risk that the Board wishes the Group to bear (its ‘risk appetite’) in order to achieve its strategic objectives
whilst remaining within all regulatory constraints and its own defined levels of capital and liquidity. The Board reviews the statement and
related qualitative and quantitative measures on at least an annual basis to ensure the document continues to reflect the Board’s
appetite for risk within the context of the environment in which the Group operates.

The Group’s Risk Committee provides oversight of the adequacy of the Group’s Risk Management Framework based on the risks
to which the Group is exposed. It monitors how management complies with the Group’s risk management policies and procedures.
It is assisted in the discharge of this duty by the Group’s Risk & Compliance Department which has responsibility for monitoring the
overall risk environment of the Group. The Risk Committee also regularly monitors exposure against the Group’s Risk Appetite.

The Group’s Audit Committee is responsible for overseeing the financial statements and working closely with the Risk Committee,
for both review and oversight of internal controls. The Audit Committee is assisted in the discharge of its obligations by Internal Audit
who undertake periodic and ad-hoc reviews on the effectiveness of controls and compliance with risk management policies.

The Group’s risk management policies are intended to ensure that risks are identified, evaluated and subject to ongoing monitoring and
mitigation (where appropriate). The risk management policies also serve to set the appropriate control framework. The aim is to promote
a robust risk culture with employees across the Group understanding their role and obligations under the framework.

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30. Risk management continued

Capital structure and capital management

The capital structure of the Group and Company consists of issued share capital, reserves and retained earnings as disclosed in the
Consolidated and Company Statement of Changes in Equity.

Capital generated from the business is both reinvested in the business to generate future growth and returned to shareholders,
principally in the form of dividends. Capital adequacy is given a high level of focus to ensure not only that regulatory capital requirements
are met, but that the Group is sufficiently capitalised against the risks to which it is currently exposed, as well as to withstand a range
of potential stress events.

There were no changes in the Group’s approach to capital management during the year.

Regulatory capital requirements

The Group conducts an Internal Capital Adequacy Assessment Process (‘ICAAP’), as required by the Financial Conduct Authority
(‘FCA’) to assess the appropriate amount of regulatory capital to be held by the Group. There are two active regulated entities in the
Group: Brewin Dolphin Limited (‘BDL’) regulated by the FCA and Brewin Dolphin Wealth Management Limited regulated by the Central
Bank of Ireland. The Jersey branch of BDL is regulated by the Jersey Financial Services Commission. There is one further regulated
entity in the Group, Brewin Dolphin Capital & Investments (Ireland) Limited acquired on 31 October 2019; the trade from this entity was
hived up to Brewin Dolphin Wealth Management Limited during the year to 30 September 2020.

The Pillar II capital assessment of the ICAAP is the Board of Directors’ opinion of the level of capital the Group should hold against the
risks to which the Group is exposed. The ICAAP is kept updated throughout the year to take account of changes to the profile of the
risks facing the Group and for any material changes to strategy or business plans. The ICAAP is discussed and approved at a Brewin
Dolphin Holdings PLC Board meeting at least annually.

Regulatory capital adequacy is monitored by management. The Group uses the standardised approach to credit risk to calculate Pillar I
requirements. The Group complied with the FCA’s regulatory capital requirements throughout the year.

The regulatory capital resources of the Group were as follows:

Share capital
Share premium account
Own shares
Hedging reserve
Revaluation reserve
Merger reserve
Profit and loss account

Shares to be issued
Regulatory capital resources before deductions
Deduction – Intangible assets (net of deferred tax liability)
Deduction – Defined benefit pension scheme asset (net of deferred tax liability)
Deduction – Free deliveries
Total regulatory capital resources after deductions at 30 September

2020
£’000
3,032
58,340
(25,238)
–
(2)
70,553
228,351
335,036
3,738
338,774
(161,183)
(16,463)
(10)
161,118

2019
£’000
3,032
58,238
(25,214)
(24)
3
70,553
231,115
337,703
3,668
341,371
(111,042)
(14,420)
(11)
215,898

Information disclosure under Pillar 3 of the Capital Requirements Directive will be published on the Group’s website before
31 December 2020 at www.brewin.co.uk.

Significant accounting policies

Details of the significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which
income and expenses are recognised, in respect of each financial asset and financial liability, are disclosed in note 3(s) to the
financial statements.

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Categories of financial instruments

Group

Financial assets
Financial assets at FVTOCI
Financial assets at FVTPL
Non-current finance lease receivables
Current finance lease receivables
Non-current receivables
Current loans and receivables
Cash and cash equivalents
At 30 September

Financial liabilities
Shares to be issued including premium
Financial liabilities at FVTPL – deferred and contingent consideration
Amortised cost
At 30 September

Company

Financial assets
Current loans and receivables
Cash and cash equivalents
At 30 September

Financial liabilities
Shares to be issued including premium
Amortised cost
At 30 September

Market risk

Carrying value

2020
£’000

2019
£’000

68
379
1,966
167
931
239,096
180,533
423,140

3,738
6,587
291,093
301,418

79
373
–
–
–
206,494
229,199
436,145

3,668
7,888
202,924
214,480

Carrying value

2020
£’000

2019
£’000

35,042
1,256
36,298

3,738
7,334
11,072

38,967
47,000
85,967

3,668
7,346
11,014

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, will affect the
Group’s income or the value of its holdings of financial instruments. The objective of the Group’s market risk management is to both
control and manage exposure within the Group’s risk appetite whilst accepting the inherent risk of market fluctuations.

The Group undertakes trades on an agency basis on behalf of its clients. The Group holds financial instruments as principal but does
not trade as principal. All trades are matched in the market (see note 19).

The Group transacts foreign currency deals in order to fulfil our client obligations and any non-sterling costs to our business.
Foreign currency exposure is matched intra-day and at the end of each day.

The total net foreign exchange exposure resulting from income yet to be converted to sterling at the year end was a debtor of £870,000
(2019: £804,000).

The Group is exposed to translation risk in respect of the foreign currency value of the net assets of Brewin Dolphin Wealth
Management Limited (‘BDWM’) and its subsidiary Brewin Dolphin Capital & Investments (Ireland) Limited acquired on 31 October 2019
(see note 35 for details), both based in the Republic of Ireland, together ‘Brewin Dolphin Ireland’. At the year end Brewin Dolphin Ireland
had net assets of £50.6 million (2019: £5.1 million) denominated in its local currency (Euros).

There has been no change to the Group’s exposure to market risks or the manner in which it manages and measures the risk during
the year with the exception of the cash flow hedge detailed below.

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30. Risk management continued

Cash flow hedge

The Group has not undertaken any cash flow hedges in the current year. In the prior year, the Group undertook a short term cash
flow hedge for €52.0 million (see below) to mitigate foreign exchange risk, ahead of the completion of the acquisition of Investec Capital
& Investments (Ireland) Limited (see note 35). This was the only derivative held during 2019.

Equity price risk

The Group is exposed to equity price risk arising from both FVTOCI and FVTPL investments (see note 20).

Equity price sensitivity analysis

The sensitivity analyses below have been determined based on the exposure to equity price risk at the reporting date.

If equity prices had been 5% higher/lower:

• Pre-tax profit for the year ended 30 September 2020 would have been £1,900 higher/lower (2019: £18,650 higher/lower) due

to changes in the fair value of financial assets at fair value through profit or loss; and

• Other equity reserves as at 30 September 2020 would increase/decrease by £4,300 (2019: increase/decrease by £3,900) pre-tax

for the Group as a result of the changes in fair value of financial assets through other comprehensive income.

The Group’s sensitivity to equity prices has not changed significantly from the prior year.

Interest rate risk

The Group is exposed to interest rate risk in respect of the Group’s cash and in respect of client deposits. The Group holds client and
firm deposits on demand and in 30 to 95 day notice accounts. Client deposits are fully segregated from the Group’s deposits and held
in separate accounts. During the year a 0.25% increase in base rate would have increased pre-tax profit by £272,000 (2019: 1%
increase in base rate £1,159,000).

Credit risk

Credit risk refers to the risk that a client or other counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group’s exposure to credit risk arises principally from the settlement of client and market transactions (‘settlement risk’) and
cash deposited at banks.

The Company has credit risk resulting from intercompany balances held with its subsidiaries; these are reviewed for impairment at each
reporting date.

Settlement risk

Exposures to settlement risk are spread across a large number of counterparties and clients. A delivery versus payment (‘DVP’)
settlement method is also used for the majority of transactions, ensuring that securities and cash are exchanged within a short period
of time. Consequently, no residual maturity analysis is presented. The Group also holds collateral in the form of cash, as well as equity
and bonds which are quoted on recognised exchanges. This collateral is held, principally, in Group nominee accounts.

Concentration of credit risk

The Group has no significant concentration of credit risk with the exception of cash. The Group utilises a panel of five internally
approved major banking groups and the majority of cash is currently spread across all five on the panel.

Maximum exposure

The maximum exposure to credit risk at the end of the reporting year is equal to the Balance Sheet figure.

Credit exposure

Credit exposure in relation to settlement risk is monitored daily. The Group’s exposure to large trades is limited with an average bargain
size in the current year of £16,971 (2019: £16,403).

Impaired assets

The total gross amount of individually impaired assets in relation to trade receivables at the year end was £392,000 (2019: £179,000).
Collateral valued at fair value by the Group in relation to these impaired assets was £59,000 (2019: £136,000). This collateral is stock
held in the clients’ account which per our client terms and conditions can be sold to meet any unpaid liabilities falling due. The net
difference has been provided as an allowance for credit impaired assets (see note 19). Note 19 details amounts past due but
not impaired.

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Non-impaired assets

Financial assets that are neither past due nor impaired in respect of trade receivables relate mainly to bonds and equity trades quoted
on a recognised exchange, which are matched in the market, and are either traded on a Delivery Versus Payment basis or against
a client’s portfolio in respect of which any one trade would normally be a small percentage of the client’s collateral held by the Group’s
nominees. At the year end no financial assets that would otherwise be past due or impaired had been renegotiated (2019: none).

Loans to employees are repayable over a maximum of three years (see note 19).

The credit risk on liquid funds, cash and cash equivalents is limited as deposits are diversified across a panel of major banks.
This ensures that the Group is not excessively exposed to an individual counterparty. The Group’s policy requires cash deposits
to be placed with banks with a minimum long-term credit rating of A- (S&P)/A3 (Moody’s)/A- (Fitch), excluding Brewin Dolphin Wealth
Management Limited and its subsidiaries. Requirements and limits are reviewed on a regular basis. The Group’s allocation of cash and
cash equivalents to S&P rating grades has been outlined in the below table:

Cash and cash equivalents

AA
0.4%

A+
40.5%

A
34.9%

A-
17.2%

Below A-
7.0%

The Group maintains a set of Credit Risk policies which are regularly reviewed by the Board. A due diligence review is also performed
on all counterparties on an annual basis, at a minimum. The investment of cash is managed by the Treasury team.

There has been no material change to the Group’s exposure to credit risk during the year.

Liquidity risk

Liquidity risk refers to the risk that the Group will be unable to meet its financial obligations as they fall due. The Group maintains
adequate cash resources to meet its financial obligations at all times. When investing cash belonging to the Group or its clients,
the focus is on security of principal and the maintenance of liquidity. Client money is held in segregated client bank accounts with
strict limits on deposit tenors, in accordance within regulatory guidelines designed to minimise liquidity risk.

The Group has a Liquidity Policy which is reviewed by the Board regularly. The Group’s intention at all times is to operate with an
amount of liquid resources which provides significant headroom above that required to meet its obligations. Group cash resources
are monitored on a daily basis through position reports and liquidity requirements are analysed over a variety of forecast horizons.
Liquidity stress tests are regularly conducted to ensure ongoing liquidity adequacy, and a Contingency Funding Plan is also maintained
to provide backup liquidity in the unlikely event of a severe liquidity stress event.

At 30 September 2020, the Group had access to a revolving credit facility of £10 million which is undrawn (2019: £10 million).

There has been no change to the Group’s exposure to liquidity risk or the manner in which it manages and measures the risk during
the year.

Group

The following are the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required
to pay.

At 30 September 2020

Financial liabilities
Shares to be issued including premium
Financial liabilities at FVTPL – deferred and
contingent consideration
Amortised cost

At 30 September 2019

Financial liabilities
Shares to be issued including premium
Financial liabilities at FVTPL – deferred and
contingent consideration
Amortised cost

Up to
1 month
£’000

1 month to
3 months
£’000

3 months to
1 year
£’000

1 to
5 years
£’000

Over
5 years
£’000

Total
£’000

–

3,875

–

3,875

–
181,387
181,387

–
34,564
34,564

2,859
29,900
32,759

3,875
34,641
42,391

–
20,300
20,300

6,734
300,792
311,401

Up to
1 month
£’000

1 month to
3 months
£’000

3 months to
1 year
£’000

1 to
5 years
£’000

Over
5 years
£’000

–

3,875

–
150,044
150,044

–
31,808
31,808

1,409
19,920
21,329

6,734
1,152
11,761

–

–
–
–

Total
£’000

3,875

8,143
202,924
214,942

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Notes to the Financial Statements continued

30. Risk management continued

Company

The following are the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required
to pay.

At 30 September 2020

Financial liabilities
Shares to be issued including premium
Amortised cost

At 30 September 2019

Financial liabilities
Shares to be issued including premium
Amortised cost

Up to
1 month
£’000

1 month to
3 months
£’000

3 months to
1 year
£’000

1 to
5 years
£’000

Over
5 years
£’000

–
7,334
7,334

–
–
–

3,875
–
3,875

–
–
–

Up to
1 month
£’000

1 month to
3 months
£’000

3 months to
1 year
£’000

1 to 5 years
£’000

Over
5 years
£’000

–
7,346
7,346

–
–
–

3,875
–
3,875

–
–
–

Total
£’000

3,875
7,334
11,209

Total
£’000

3,875
7,346
11,221

Fair value measurement recognised on the Balance Sheet

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value,
grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 fair value measurements are those derived from inputs other than the quoted price included within Level 1 that are observable

for the asset or a liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

• Level 3 fair value measurements are those derived from formal valuation techniques that include inputs for the asset or liability that are

not based on observable market data (unobservable inputs).

Fair value of the Group’s financial assets and liabilities that are measured at fair value on a recurring basis

Some of the Group’s financial assets and liabilities are measured at fair value at the end of each reporting period. The following table
gives information about how the fair values of these financial assets and liabilities are determined.

Fair value
as at
30 September
2020
£’000

Fair value
as at
30 September
2019
£’000

Valuation technique(s) and key input(s)

Significant
unobservable input(s)

Relationship
of unobservable inputs
to fair value

379

373 Quoted bid prices in an active market.

n/a

The valuation is based on published
monthly NAVs.
The valuation is based on the net assets
as presented in the most recent audited
financial statements of the company.
A marketability discount is applied
as this investment is highly illiquid.

n/a

Marketability
discount ranging
between 30-50%.

As the marketability
discount increases
the valuation
decreases.

n/a

Level 1
Financial assets
at FVTPL
Level 3
Financial assets
at FVTOCI – Equity
Financial assets
at FVTOCI – Equity

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Sensitivity analysis

A sensitivity analysis of the significant unobservable inputs used in valuing the Level 3 financial instruments is set out below:

Financial asset
Current assets – financial assets at FVTOCI – Equity Marketability discount

Assumption

Change in assumption
Increase by 5%

Impact on valuation
Decrease by £4,300

Fair value hierarchy

At 30 September 2020

Financial assets at FVTPL
Equities
Financial assets at FVTOCI
Equities
Total

At 30 September 2019

Financial assets at FVTPL
Equities
Financial assets at FVTOCI
Equities
Total

Reconciliation of Level 3 fair value measurement of financial assets:

Financial assets at FVTOCI

Balance at 30 September 2018
Net gain from changes in fair value recognised in equity
Disposals
Balance at 30 September 2019
Net loss from changes in fair value recognised in equity
Disposals
Balance at 30 September 2020

Level 1
£’000

Level 2
£’000

Level 3
£’000

Total
£’000

379

–
379

–

–
–

–

68
68

379

68
447

Level 1
£’000

Level 2
£’000

Level 3
£’000

Total
£’000

373

–
373

–

–
–

–

79
79

373

79
452

Total
£’000
676
1
(598)
79
(5)
(6)
68

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Notes to the Financial Statements continued

31. Share-based payments

The Group recognised total expenses in the year of £9,779,000 (2019: £7,769,000) related to equity-settled share-based
payment transactions.

For a summary of all options and awards outstanding at the year end see note 27.

Equity-settled share option schemes

The Group has one plan, the 2004 Approved Option Scheme (‘the Scheme’), for the granting of non-transferable options to employees.
All options granted have fully vested and the services received from employees entitled to options under the Scheme have been
fully expensed.

Other equity settled share-based payment plans

Long Term Incentive Plan (‘LTIP’)

The LTIP is a conditional arrangement under which contingent share awards can be made to selected senior management, including
the Executive Directors. Details regarding the awards to the Executive Directors are set out in the Remuneration Report. The award will
vest in one tranche, no earlier than three years from the grant date. Vesting will be subject to performance conditions which are set prior
to each grant by the Remuneration Committee. The performance conditions will be related to the financial performance of the Group.

During 2020, the Group granted 1,192,743 LTIP awards which have an aggregate fair value of £3,507,499 at the date of grant.
The Black-Scholes model is used to fair value the LTIP at the date of grant. The inputs into the Black-Scholes model used for the
purposes of determining fair value were as follows:

Weighted average share price
Weighted average exercise price
Expected volatility
Expected life (yrs.)
Risk free rate
Expected dividend yield

Share Incentive Plan (‘SIP’)

345p
0.0p
23.74%
3
0.77%
5.32%

Employees who have been employed for longer than six months and are subject to PAYE are invited to join the SIP. Employees may
use funds from their gross salary (being not less than £10 and not greater than £150) to purchase ordinary shares in the Company
(‘Partnership Shares’). For every Partnership Share purchased, the employee receives matching shares (up to a total value of £20 per
month). Employees are offered an annual opportunity to top up contributions to the maximum annual limit of £1,800 (or 10% of salary
if lower). All shares to date awarded under this scheme have been purchased in the market monthly. It is the intention of the Directors
to continue this policy in the year to 30 September 2021.

Deferred Profit Share Plan (‘DPSP’)

The DPSP provides for eligible employees to defer part of their annual profit share entitlement into an award over ordinary shares
(an ‘Award’). Current policy is that employees receiving annual profit share in excess of £50,000 are required to defer 33% of any profit
share in excess of this amount for a period of three years. Additional deferral requirements apply to Executive Directors which are set
out in the Directors’ Remuneration Report. Awards are generally in the form of nil cost options to acquire ordinary shares, although at
the discretion of the Remuneration Committee they may also take the form of a conditional right to receive ordinary shares. Awards in
the form of mandatory deferrals made to the employees who leave the Group at any time prior to vesting lapse unless the employee
leaves as a result of good leaver provisions. It is the intention of the Board to recommend our Trustees to purchase the shares in the
market to satisfy options awarded under this scheme in order to avoid dilution in the year to 30 September 2021.

During 2020, the Group granted 2,340,551 DPSP options which have an aggregate fair value of £8,074,901 at the date of grant.

Equity Award Plan (‘EAP’)

The EAP is a discretionary arrangement under which contingent share awards can be made to selected employees within the Group
below Board level, for example to reward exceptional performance on behalf of the Group or in certain circumstances to aid key staff
retention. Awards are generally in the form of conditional share awards, although at the discretion of the Remuneration Committee they
may also take the form of share options. Awards will normally vest three years after grant subject to continued service provisions.
Awards will only be capable of being satisfied with existing shares sourced via the Company’s employee benefit trust. No newly issued
shares and/or treasury shares can be used under the EAP. Only non-director employees are eligible for selection to participate in
the plan.

During 2020, the Group granted 148,561 EAP awards which have an aggregate fair value of £510,544 at the date of grant.

Share Award Agreement (‘SAA’)

The SAA was established specifically to facilitate the recruitment of the Chief Finance Officer and mirrors the rules of the LTIP subject to
variations as set out in the SAA. The SAA was made in the form of conditional share awards with varying vesting dates. No performance
conditions were attached to the SAA. The SAA is only capable of being settled by the transfer of existing shares via the ESOT and
no newly issued or treasury shares can be used to satisfy the awards.

No awards have been made in the year.

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32. Operating lease arrangements

Group

The Group as lessor

Disclosure required by IFRS 16

Operating leases, in which the Group is lessor, relate to certain property leases where there is surplus office space that the Group has
sublet. The Group acts as an intermediate lessor in the sublease, where the Group has not transferred substantially all the risks and
rewards of the head lease to the lessee, the sublease is classified as an operating lease.

The subleases have terms of 9 to 12 years and may contain tenant exercisable break options.

Maturity analysis of the operating lease payments receivable:

Less than 1 year
1 to 2 years
2 to 3 years
3 to 4 years
4 to 5 years
Greater than 5 years
Total operating lease payments receivable

Disclosure required by IAS 17

2020
£’000
687
687
687
687
687
1,158
4,593

As at 30 September 2019, there was £6.6 million of future minimum sublease payments expected to be received under non-cancellable
subleases. These expected future sublease receipts are deducted in arriving at the onerous contracts provision.

The Group as lessee

Disclosure required by IAS 17

The Group recognised operating leases payments as an expense in 2019 as follows:

Lease payments

Land and
buildings
£’000
7,744
7,744

Hire of
equipment
£’000
297
297

The Group had significant operating lease arrangements with respect to the premises it occupies. Hire of equipment is in relation
to multifunctional printers and vending machines.

At 30 September 2019, the Group had outstanding commitments for future minimum lease payments under non-cancellable
operating leases, which fall due as follows:

Amounts payable under operating leases:
Within one year
In the second to fifth years inclusive
After five years

Land and
buildings
£’000

Hire of
equipment
£’000

8,828
33,334
27,468
69,630

221
30
–
251

The balances disclosed above include future minimum onerous operating lease payments which are included in the onerous contracts
provision calculation.

33. Contractual commitments

Group

Capital expenditure authorised and contracted for at 30 September 2020 but not provided in the Financial Statements amounted
to £0.7 million (2019: £7.8 million).

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Notes to the Financial Statements continued

34. Notes to the Cash Flow Statement

Group

Operating profit
Adjustments for:

Depreciation of property, plant and equipment
Depreciation of right of use assets
Amortisation of intangible assets – client relationships and brand
Amortisation of intangible assets – software
Defined benefit pension scheme past service costs
Defined benefit pension scheme cash contributions
Share-based payment expense
Translation adjustments
Lease incentive
Interest income
Interest expense

Operating cash flows before movements in working capital
Increase in payables and provisions
Decrease in receivables and trading investments
Cash generated by operating activities
Tax paid
Net cash inflow from operating activities

2020
£’000
63,792

3,114
6,250
11,072
417
–
(1,250)
9,779
303
442
491
(20)
94,390
27,237
(27,347)
94,280
(16,894)
77,386

There are no liabilities due to financing activities other than lease liabilities, a reconciliation of which is provided in note 23.

Company

Operating profit/(loss)
Operating cash flows before movements in working capital
Interest income
Interest expense
(Decrease)/increase in payables
Decrease in receivables and trading investments
Cash generated by operating activities
Tax paid
Net cash inflow from operating activities

2020
£’000
45,410
45,410
5
(16)
(154)
3,925
49,170
–
49,170

2019
£’000
60,961

2,823
–
6,858
1,105
1,909
(1,979)
7,769
(31)
–
1,414
(16)
80,813
43,227
(45,084)
78,956
(12,309)
66,647

2019
£’000
(799)
(799)
26
–
152
33,712
33,091
–
33,091

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35. Business combinations

Group

2020

Investec Capital & Investments (Ireland) Limited

On 31 October 2019, Brewin Dolphin Wealth Management Limited (‘BDWM’), a subsidiary, based in the Republic of Ireland,
completed the acquisition of Investec Capital & Investments (Ireland) Limited (‘ICIIL’), the wealth management business of Investec
Group in the Republic of Ireland. The acquired entity has been renamed Brewin Dolphin Capital and Investments (Ireland) Limited
(‘BDCIIL’). BDCIIL was acquired to meet the delivery of the Group’s strategic objectives by expanding the Group’s presence and scale
in Ireland.

The acquisition has been accounted for using the acquisition method. Details of the purchase consideration, the fair value of the net
assets and intangible assets acquired, and the net cash outflow arising on acquisition are as follows:

Purchase consideration:

Cash paid
Net assets acquired for cash
Total purchase consideration

£’000
32,029
11,335
43,364

The fair values of the assets and liabilities recognised as a result of the acquisition are provisional and may be subject to change during
the measurement period:

Amounts recognised:

Non-current assets

Intangible asset – client relationships1

Current assets

Trade and other receivables
Cash and cash equivalents

Current liabilities

Trade and other payables
Cash and cash equivalents

Non-current liabilities
Identifiable net assets acquired

Goodwill

£’000

32,067

8,316
14,102

(7,773)
(1,380)
(4,008)
41,324

2,040

1. The fair value of BDCIIL’s client relationship intangible assets on consolidation has been measured using a multi-period excess earnings method. The model uses
estimates of client longevity and the level of both funds and activity driving income to derive a forecast series of cash flows, which are discounted to a present
value to determine the fair value of the client relationships acquired.

The goodwill balance comprises:

• the excess of the fair value of the assets acquired (excluding the deferred tax liability) over the consideration paid which was negative;

and

• the value of the deferred tax liability arising on recognition of the client relationship intangible asset on acquisition.

Net cash outflow arising on acquisition:

Consideration paid in cash

Less: Net assets acquired for cash

Total net cash outflow1

£’000
43,364
(11,335)
32,029

1. Shown in the line item “Acquisition of subsidiaries” within the Consolidated Cash Flow Statement.

Acquisition-related costs

Acquisition-related costs of £3,600,000 have been recognised as an expense in the Income Statement (2019: £1,734,000).

ii. Revenue and net profit

The acquired business contributed revenues of £13,491,000 and profit after tax of £2,201,000 to the Group for the period from
31 October 2019 to 30 September 2020 excluding the impact of the amortisation for the client relationships recognised on acquisition.
If the acquisition had occurred on 1 October 2019, consolidated revenue and consolidated profit after tax for the year would have
been £1,226,500 and £200,100 higher respectively, excluding the impact of the amortisation for the client relationships recognised
on acquisition.

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Notes to the Financial Statements continued

35. Business combinations continued

2019

Aylwin Limited

On 11 March 2019, the Group’s principal operating subsidiary, Brewin Dolphin Limited, acquired 100% of the ordinary share capital
of Aylwin Limited (‘Aylwin’), an unlisted company based in Surrey which specialises in the provision of financial planning services.

Aylwin was acquired to expand the Group’s financial planning activities in Southern England and contribute to the delivery of the
Group’s strategic objectives. In turn, Aylwin’s clients will benefit from access to Brewin Dolphin’s broader product and service offering.

Purchase consideration:

Cash paid
Net assets acquired for cash
Deferred consideration (see ii below)
Total purchase consideration

£’000
1,944
428
1,968
4,340

The fair values of the assets and liabilities recognised as a result of the acquisition are provisional and may be subject to change during
the measurement period:

Amounts recognised:

Non-current assets

Intangible asset – client relationships1

Current assets

Trade and other receivables
Cash and cash equivalents

Current liabilities

Trade and other payables

Non-current liabilities
Identifiable net assets acquired
Goodwill

£’000

3,912

133
511

(216)
(665)
3,675
665

1. The fair value of Aylwin’s client relationship intangible assets has been measured using a multi-period excess earnings method. The model uses estimates of client
longevity and the level of activity driving commission income to derive a forecast series of cash flows, which are discounted to a present value to determine the fair
value of the client relationships acquired.

Net cash outflow arising on acquisition:

Consideration paid in cash

Less: net assets acquired for cash

Total net cash outflow1

£’000
2,372
(428)
1,944

1. Shown in the line item ‘Acquisition of subsidiaries’ within the Consolidated Cash Flow Statement.

Acquisition-related costs

i.
Acquisition-related costs amounting to £73,800 have been recognised as an expense in the Income Statement for the year ended
30 September 2019.

Deferred consideration

ii.
The deferred consideration comprises two cash payments of £1 million each, due on the first and second completion anniversaries.
The fair value of the deferred consideration payments has been estimated to be £1,944,000 after calculating the present value of the
future cash flows.

Revenue and profit contribution

iii.
Aylwin contributed revenues of £645,000 and profit after tax of £130,000 to the Group for the period from 12 March 2019
to 30 September 2019. If the acquisition had occurred on 1 October 2018, consolidated revenue and consolidated profit after tax
for the year to 30 September 2019 would have been £1,257,000 and £265,000 higher respectively.

Aylwin contributed revenues of £66,000 and profit after tax of £29,000 to the Group for the period from 12 March 2019
to 31 March 2019.

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b. Mathieson Consulting Limited (’MC’)

On 1 April 2019, Brewin Dolphin Limited acquired 100% of the ordinary share capital of MC, a consultancy business, that provides an
expert witness report service covering pensions. MC was acquired to expand the Group’s professional service offering and contribute
to the delivery of the Group’s strategic objectives.

Purchase consideration:

Cash paid
Net assets acquired for cash
Deferred consideration (see ii below)
Total purchase consideration

£’000
736
413
652
1,801

The fair values of the assets and liabilities recognised as a result of the acquisition are provisional and may be subject to change during
the measurement period:

Non-current assets

Property, plant and equipment
Intangible asset – brand1

Current assets

Trade and other receivables
Cash and cash equivalents

Current liabilities

Trade and other payables

Non-current liabilities
Identifiable net assets acquired
Goodwill

£’000

12
1,388

192
362

(153)
(236)
1,565
236

1. The fair value of MC’s brand intangible asset has been measured using a multi-period excess earnings method. The model uses the expected level of activity
driving commission income to derive a forecast series of cash flows, which are discounted to a present value to determine the fair value of the brand acquired.

Net cash outflow arising on acquisition:

Consideration paid in cash

Less: net assets acquired for cash

Total net cash outflow1

£’000
1,149
(413)
736

1. Shown in the line item ‘Acquisition of subsidiaries’ within the Consolidated Cash Flow Statement.

Acquisition-related costs

i.
Acquisition-related costs amounting to £68,300 have been recognised as an expense in the Income Statement for the year ended
30 September 2019.

Deferred consideration

ii.
The deferred consideration comprises three payments, on each of the first three completion anniversaries. The fair value of the
payments has been estimated to be £652,000 after calculating the present value of the future cash flows.

Revenue and profit contribution

iii.
MC contributed revenues of £528,000 and profit after tax of £57,000 to the Group for the period from 1 April 2019 to
30 September 2019. If the acquisition had occurred on 1 October 2018, consolidated revenue and consolidated profit after tax for the
year to 30 September 2019 would have been £1,031,000 and £120,000 higher respectively.

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Strategic ReportGovernanceFinancial StatementsOther InformationNotes to the Financial Statements continued

35. Business combinations continued

Epoch

On 9 August 2019, Brewin Dolphin Limited acquired the assets and staff of Epoch Wealth Management LLP, an IFA firm based in Bath,
for an initial payment of £10.0 million, an estimated deferred consideration of £1.5 million and an estimated contingent consideration
of £7.75 million which is subject to performance conditions. The acquisition is expected to increase the Group’s market share.

Purchase consideration:

Cash paid
Contingent consideration (see ii below)
Total purchase consideration

£’000
10,000
8,792
18,792

The fair values of the assets and liabilities recognised as a result of the acquisition are provisional and may be subject to change during
the measurement period:

Non-current assets

Intangible asset – client relationships1

Non-current liabilities
Identifiable net assets acquired
Goodwill

£’000

18,792
(3,195)
15,597
3,195

1. The fair value of Epoch’s client relationship intangible assets has been measured using a multi-period excess earnings method. The model uses estimates of client
longevity and the level of activity driving commission income to derive a forecast series of cash flows, which are discounted to a present value to determine the fair
value of the client relationships acquired.

Net cash outflow arising on acquisition:

Consideration paid in cash
Total net cash outflow1

£’000
10,000
10,000

1. Shown in the line item ‘Purchase of intangible assets – client relationships’ within the Consolidated Cash Flow Statement.

Acquisition-related costs

i.
Acquisition-related costs of £461,000 have been recognised as an expense in the Income Statement for the year ended
30 September 2019.

Contingent consideration

ii.
The contingent consideration comprises three separate payments. The estimated first contingent consideration comprises a single
cash payment due 18 months following the acquisition date. The fair value of the payment has been estimated to be £1,476,000
after calculating the present value of the future cash flows. The estimated second contingent consideration has been fair valued
at £7,316,000 and will be settled in both cash and the Company’s shares, upon satisfaction of the performance conditions.
This contingent consideration is payable at the end of the twelve-month performance period to 30 September 2022; the measurement
of performance can be delayed under certain circumstances by the seller. A third contingent consideration will be settled in both cash
and the Company’s shares at the end of 30 September 2024 if performance conditions are met. As at 30 September 2019, it is not
expected that this contingent consideration will be payable, therefore it has been estimated as £nil.

iii. Acquired tangible assets and other assets
The fair value of the acquired Property, Plant and Equipment and other assets is £nil.

iv. Revenue and net profit
The acquired business contributed revenues of £618,000 and profit after tax of £130,000 to the Group for the period from
9 August 2019 to 30 September 2019. If the acquisition had occurred on 1 October 2018, consolidated revenue and consolidated
profit after tax for the year to 30 September 2019 would have been £4,339,000 and £467,000 higher respectively.

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36. Related party transactions

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation. The primary
statements of the Company include amounts attributable to subsidiaries. These amounts have been disclosed in aggregate in the
relevant notes to the financial statements of the Company and in detail in the following table:

Bell Lawrie White & Co. Limited
Brewin Dolphin Limited
Brewin Broking Limited

Amounts owed
by related parties

Amounts owed
to related parties

2020
£’000
–
35,042
–
35,042

2019
£’000
–
38,967
–
38,967

2020
£’000
2,434
–
4,900
7,334

2019
£’000
2,434
–
4,900
7,334

All amounts owed by related parties are interest free and repayable on demand.

The only effect of related party transactions on the profit and loss of the Company was in respect of dividends. The Company received
dividends of £45,500,000 (2019: £nil) from Brewin Dolphin Limited and £nil (2019: £1,067,250) from Brewin Dolphin Wealth
Management Limited.

The Group companies did not enter into any transactions with related parties who are not members of the Group during the year,
save as disclosed elsewhere in these financial statements.

All amounts outstanding with related parties are unsecured and will be settled in cash. No guarantees have been given or received.

No provisions have been made for doubtful debts in respect of the amounts owed by related parties.

Remuneration of key management personnel (‘KMP’)

Key management personnel are responsible for planning, directing and controlling the activities of the Group. Key management
personnel for the Group have been determined to be the Directors and members of the Executive Committee.

The remuneration expense for key management personnel is as follows:

Short-term employee benefits
Post-employment benefits
Share-based payment:

Lapses where KMP have left the Group
Continuing KMP

2020
£’000
4,646
22

(109)
1,221
5,780

2019
£’000
4,968
16

–
1,047
6,031

The remuneration of individual Directors is set out in the Directors’ Remuneration Report on page 83 in addition to the disclosure above.

A number of the Group’s key management personnel and their close family members make use of the services provided by companies
within the Group. Charges for such services are made at various staff rates.

Directors’ transactions

There are no contracts, loans to Directors or other related party transactions with Directors.

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Notes to the Financial Statements continued

37. Impact of application of IFRS 16 Leases

Group

The Group adopted IFRS 16 from 1 October 2019. In accordance with the transition requirements of IFRS 16, comparative information
for 2019 has not been restated.

The adoption of IFRS 16 has resulted in a significant increase in the Group’s reported assets and liabilities on its Consolidated Balance
Sheet. The depreciation (of the ROU asset) and interest charges (unwind of the discounted lease liability) have replaced the lease costs
charged to other operating costs in the Income Statement on a straight-line basis under the previous standard (IAS 17).

The application of IFRS 16 has had no impact on the consolidated cash flows of the Group except that lease payments and associated
interest payments are shown within financing activities rather than net cash flows from operating activities and include interest received
and cash payments from lessees. There has been no impact on the basic and diluted earnings per share for the Group.

Impact on the Consolidated Balance Sheet as at 1 October 2019

The table below shows the amount of adjustment for each financial statement line item affected by the initial application of IFRS 16.

Property, plant and equipment
Right of use assets
Non-current other receivables
Non-current finance lease receivables
Total non-current assets
Current trade and other receivables
Current finance lease receivables
Total current assets
Total assets
Current trade and other payables
Current lease liabilities
Current provisions
Total current liabilities
Net current assets
Net deferred tax liability
Non-current lease liabilities
Non-current provisions
Total non-current liabilities
Total liabilities
Net assets
Profit and loss account
Total equity

ROU assets

At
30 September
2019
£’000
10,659
–
–
–
145,278
216,212
–
445,863
591,141
220,921
–
4,350
231,306
214,557
2,699
–
14,933
22,132
253,438
337,703
231,115
337,703

Adjustments

£’000
(217)
43,305
688
1,181
44,957
(1,371)
118
(1,253)
43,704
(3,039)
6,653
(521)
3,093
(4,346)
(1,323)
51,131
(3,384)
46,424
49,517
(5,813)
(5,813)
(5,813)

At
1 October
2019
£’000
10,442
43,305
688
1,181
190,235
214,841
118
444,610
634,845
217,882
6,653
3,829
234,399
210,211
1,376
51,131
11,549
68,556
302,955
331,890
225,302
331,890

These assets (see note 15) represent the Group’s contractual right to access an identified asset under the terms of the lease contract.

Finance lease receivables

Amounts due from lessees under finance leases are recognised as finance lease receivables (see note 16) and represent the Group’s
net investment in the finance sublease.

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Lease liabilities

The liabilities represent the Group’s contractual obligation to minimum lease payments during the lease term. Any liability payable in the
next 12 months is recognised in current liabilities and all other liabilities are recognised in non-current liabilities.

To measure the lease liabilities, the remaining lease payments were discounted using a weighted average incremental borrowing rate
of 3.9%. See note 4b(iv) for an explanation of the determination of the incremental borrowing rate.

The table below reconciles the operating lease commitments as at 30 September 2019 disclosed in note 32 and the lease liability
recognised at the date of initial application of IFRS 16.

Operating lease commitments at 30 September 2019
Short-term leases and low value leases
Effect of discounting the above amounts
Lease liabilities recognised at 1 October 2019

Current liability
Non-current liability
Lease liabilities recognised at 1 October 2019

Deferred tax

£’000
69,881
(363)
(11,734)
57,784

6,653
51,131
57,784

A deferred tax asset has been recognised and represents the temporary corporation taxation timing difference on the transition
adjustment taken to reserves.

Trade and other payables/trade and other receivables and provisions

The adjustments to these balances are in relation to lease incentives, onerous property provisions, dilapidation provisions and certain
lease incentives which were recognised on the Consolidated Balance Sheet under IAS 17. These items are now reflected in either the
ROU assets or lease liabilities.

Retained earnings

The impact on opening retained reserves on the initial application of IFRS 16 was to reduce reserves by £5,813,000.

Impact on the Consolidated Income Statement for the year ended 30 September 2020

The Group recognised lease liability finance costs of £2,327,000 for the year; depreciation expense of £6,250,000 for the ROU assets
(see note 15); and rental income of £572,000 from operating subleases (shown in note 5 within other operating income).

For the year ended 30 September 2019, the Group recognised rental costs of £8,041,000 in accordance with IAS 17.

38. Post balance sheet events

Company and Group

There were no post balance sheet events.

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Strategic ReportGovernanceFinancial StatementsOther Information
Agility & Resilience
Other
Information

Other Information
180 Five Year Record
181 Appendix – Calculation of Key
Performance Indicators

182 Shareholder Information
183 Glossary
184 Offices

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Strategic ReportGovernanceFinancial StatementsOther InformationOther Information

Five Year Record (unaudited)

Revenue
Other operating income
Income

Staff costs
Other operating costs
Adjusted items
FSCS levy
Redundancy costs
Onerous contracts
One-off migration costs
Defined benefit pension scheme past service costs
Acquisition costs
Incentivisation awards
Amortisation of intangible assets – client relationships
and brand

Operating expenses

2020
£’000
359,164
2,283
361,447

2019
£’000
336,301
2,808
339,109

2018
£’000
326,226
2,801
329,027

2017
£’000
303,896
568
304,464

2016
£’000
280,484
1,866
282,350

(199,485)
(82,056)

(184,896)
(80,812)

(174,822)
(77,506)

(162,689)
(71,766)

(152,175)
(69,458)

–
–
(250)
–
–
(3,600)
(1,192)

–
–
(996)
–
(1,909)
(2,337)
(340)

288
–
(170)
–
–
–
(1,318)

–
(742)
(1,969)
–
–
(1,683)
(1,297)

–
(2,780)
(311)
(1,596)
–
–
–

(11,072)
(297,655)

(6,858)
(278,148)

(7,619)
(261,147)

(6,650)
(246,796)

(6,287)
(232,607)

Operating profit
Net finance (expense)/income and other gains and losses
Profit before tax
Tax
Profit attributable to equity shareholders of the parent

63,792
(1,720)
62,072
(14,117)
47,955

60,961
1,563
62,524
(14,457)
48,067

67,880
624
68,504
(15,008)
53,496

57,668
(25)
57,643
(12,490)
45,153

49,743
319
50,062
(11,095)
38,967

Dividend per share

14.3p

16.4p

15.0p

13.0p

Adjusted1 earnings per share

Basic
Adjusted1 diluted

1. See note 12.

21.1p
20.4p

21.2p
20.5p

22.5p
21.7p

20.5p
19.6p

17.7p
16.8p

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Appendix – calculation of KPIs

Revenue growth

1. Discretionary funds inflows are calculated from the Group’s
client database. The growth in net inflows is derived from the
total new client accounts opened, closed or transferred
between services categories during the year. Net fund flows
of £0.9 billion over the opening discretionary funds value of
£40.1 billion show a growth rate of 2.2%.

Improved efficiency

2. Adjusted1 PBT margin is calculated by taking the adjusted1
profit before tax of £78.2 million in 2020 (2019: £75.0 million)
over the total income of £361.4 million (2019: £339.1 million)
resulting in an adjusted1 PBT margin of 21.6% (2019: 22.1%).
3. Discretionary funds per Client Facing Certified Person
of £77 million (2019: £81 million) is based on the total of
discretionary funds excluding MPS over the total number of
client-facing professional investment managers and financial
planning staff (‘Client Facing Certified Persons’) for the Group
of 477 (2019: 448).

Capital efficiency and shareholder return

4. Capital adequacy risk appetite ratio is calculated by

dividing regulatory capital resources over the assessment
of regulatory capital requirements (see note 30 to the
financial statements).

5. Adjusted1 diluted earnings per share, the diluted earnings

per share is 20.4p (2019: 20.5p).

6. Dividend payout ratio is calculated by adding the interim and
final dividend per share paid by the Group 14.3p (2019: 16.4p)
and dividing by adjusted1 diluted EPS 20.4p (2019: 20.5p).

1. Adjusted items are amortisation of client relationships and brand,

defined benefit pension scheme past service costs, acquisition costs,
incentivisation awards, onerous contracts and other gains and losses.

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Strategic ReportGovernanceFinancial StatementsOther InformationShareholder information

Investor information

Electronic communications

Shareholders have previously passed a resolution enabling
Brewin Dolphin to take advantage of provisions in the
Companies Act 2006 that allow us to supply documents such
as the Annual Report and Accounts to our shareholders via our
website www.brewin.co.uk. This helps to reduce the cost and
environmental impact of producing and distributing printed
documents. Shareholders that wish to continue to receive
shareholder documents in hard copy can request this by writing
to the registrar, Equiniti.

All shareholder communications, including the Annual Report and
Accounts, are made available to shareholders on the Brewin
Dolphin website and you may opt to receive email notification that
documents and information are available to
view and download. If you would like to sign up for this service,
visit Equiniti’s website. You may change the way you receive
communications at any time by contacting Equiniti.

Annual General Meeting

The 2021 Annual General Meeting of Brewin Dolphin Holdings
PLC will be held at 12 Smithfield Street London EC1A 9BD
on Friday 5 February 2021 at 11.30 a.m and this will be a closed
meeting due to COVID-19. Shareholders are not permitted
to attend the meeting. Further details are available in the
Notice of Meeting.

Visit our website, www.brewin.co.uk, for investor information
and Company news. In addition to accessing financial data,
you can view and download annual and interim reports,
analyst presentations and access the best of our research
and investment views, plus lifestyle news and interviews.

You can also subscribe to an email news alert service to
automatically receive an email when significant announcements
are made.

Shareholding information

Please contact our registrars, Equiniti, directly for all enquiries
about your shareholding. Visit their Investor Centre website
www.shareview.co.uk for online information about your
shareholding (you will need your shareholder reference number
which can be found on your share certificate or dividend tax
voucher), or telephone the registrars direct: 0371 384 2237
or + 44 (0) 121 415 7047.

Dividend mandate

Shareholders can arrange to have their dividends paid directly
into their bank or building society account by completing a bank
mandate form. The advantages to using this service are:
the payment is more secure than sending a cheque through the
post; it avoids the inconvenience of paying in a cheque; and there
is no risk of lost, stolen or out-of-date cheques.

A mandate form can be obtained from Equiniti or you will find one
on the reverse of the tax voucher of your last dividend payment.

Useful contacts

Registered Office:
12 Smithfield Street, London ECIA 9BD. +44 (0) 20 7248 4400

Company Registration Number:
02685806

Company Secretary:
Tiffany Brill 0.Cosec@brewin.co.uk

Head of Investor Relations:
Carla Bloom investor.relations@brewin.co.uk

Registrar:
Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA. +44 (0) 121 415 7047

Online help:
shareview.co.uk – from here, you will be able to securely email Equiniti with your enquiry.

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Glossary

AGM

Annual General Meeting

FRC

Financial Reporting Council

ASOP

Approved Share Options Plan

FSCS

Financial Services Compensation Scheme

Aylwin

Aylwin Limited

GDPR

General Data Protection Regulation

BDCILL

Brewin Dolphin Capital & Investments (Ireland)
Limited

Brewin Dolphin Holdings PLC/Brewin Dolphin

GHG

Greenhouse Gas Emissions

Group

Brewin Dolphin Holdings PLC (the ‘Company’)
and its subsidiaries

Brewin Dolphin Limited

IAS

International Accounting Standards

BDH

BDL

BDO LLP

Internal Auditor

ICAAP

Internal Capital Adequacy Assessment Process

BDWM

Brewin Dolphin Wealth Management Limited

bps

BPS

Basis points

Brewin Portfolio Service

CASS

Client Money & Assets

CEO

Chief Executive Officer

CFCP

Client-facing Certified Person

CFO

CGU

CMA

CSR

CRO

Chief Financial Officer

Cash generating unit

Competition and Markets Authority

Corporate Social Responsibility

Chief Risk Officer

Deloitte LLP External Auditor

DFM

Discretionary Fund Management

DPSP

Deferred Profit Share Plan

EAP

Equity Award Plan

EBITDA

Earnings before interest, tax, depreciation
and amortisation

ICIIL

IFA

KPIs

KRIs

L&D

LSE

LTIP

Investec Capital & Investments (Ireland) Limited

Independent Financial Adviser

Key Performance Indicators

Key Risk Indicators

Learning and Development

London Stock Exchange

The Company’s long term incentive plan,
the ‘Long Term Performance Plan’

MAR

Market Abuse Regulation

Mathieson Mathieson Consulting Limited

MiFID II

Markets in Financial Instruments Directive

MPS

MTP

PBT

ROE

RMF

SAA

Managed Portfolio Service

Medium-Term Plan

Profit Before Tax

Return on Equity

Risk Management Framework

Share Award Agreement

Epoch

Epoch Wealth Management LLP

SMCR

Senior Managers & Certification Regime

Earnings per share

TCFD

Task Force on Climate-related Financial Disclosures

EPS

ESG

Environment, Social, Governance

Equiniti

The Company’s Registrar

FCA

Financial Conduct Authority

TSR

Total Shareholder Return

Execution Only

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O∞ces1

Brewin Dolphin Limited

Aberdeen
0122 426 7900

Bath
0122 548 7772

Belfast
0289 044 6000

Birmingham
0121 710 3500

Bristol
0117 968 9500

Cambridge
0122 345 5408

Cardiff
0292 034 0100

Cheltenham
0124 257 7677

Dundee
0138 231 7200

Edinburgh
0131 225 2566

Exeter
0139 244 0450

Gatwick
0129 3661 323

Glasgow
0141 221 7733

Ipswich
0147 326 7200

Jersey
0153 470 3000

Leeds
0113 245 9341

Brewin Dolphin Wealth Management Limited

Dublin
+353(0) 126 00080

Cork
+353(0) 212 373820

Mathieson Consulting Limited

Birmingham
0121 710 3500

Lincoln
0152 250 3000

London - City
0203 201 3900

London – West End
0203 201 4000

Oxford
0186 525 5750

Penrith
0176 886 1710

Plymouth
0175 233 4650

Manchester
0161 839 4222

Marlborough
0167 251 9600

Newcastle
0191 279 7300

Nottingham
0115 852 5580

Norwich
0160 396 4236

Royal Tunbridge Wells
0189 273 9580

Shrewsbury
0174 339 9000

Truro
0187 222 8080

Winchester
0196 279 8000

1. www.brewin.co.uk/our-offices/

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