EXECUTIVE SUMMAR
Annual Report & Financial Statements
31 March 2022
Helping you see the bigger picture
1
Contents
4
5
6
8
Financial highlights
Divisional highlights
Chair and Chief Executive’s statement
Financial review
16
Directors’ report
21
Corporate governance report
29
Corporate social responsibility
35
Remuneration report
39
Statement of Directors’ responsibilities
40
Independent Auditor’s report
45
Consolidated statement of comprehensive income
46
Consolidated and Company statement of financial position
48
Consolidated and Company statement of cash flow
50
Consolidated and Company changes in equity
52
Notes to the financial statements
91
Company information
2
About WH Ireland Group plc
WH Ireland Group plc is the holding company of two established financial services companies, WH Ireland Limited (WHI) and
Harpsden Wealth Management Limited. WHI provides a high quality service across both of its business areas - a Wealth Management
division providing investment solutions for individuals, families and charities and a Capital Markets division which is a leading firm
for public and private companies seeking corporate advice and investment capital. WHI is currently the second largest broker to AIM
companies and the third largest Nominated Adviser to AIM by number of clients (source Corporate Adviser Rankings Guide – May
2022).
Wealth Management
WHI provides independent financial planning advice and discretionary investment management. Our goal is to build long term,
mutually beneficial, working relationships with our clients so that they can make informed and effective choices about their money
and how it can support their lifestyle ambitions. We help clients to build a long term financial plan and investment strategy for them
and their families.
Capital Markets
Our Capital Markets division is specifically focused on the public and private growth company marketplace. The team’s significant
experience in this dynamic segment means that we are able to provide a specialist service to each of its respective participants. For
companies, we raise public and private growth capital, as well as providing both day-to-day and strategic corporate advice including
M&A advisory and we have recently added an experienced corporate debt team. Our tailored approach means that our teams
engage with all of the key investor groups active in our market - High Net Worth individuals, Family Offices, Wealth Managers and
Funds. Our broking, trading and research teams provide the link between growth companies and this broad investor base.
3
Financial highlights
Revenue increased 11% to
Profit before tax from continuing operations
£32.0m
(FY21: £28.7m1)
£0.1m profit
(FY21: £1.2m)
Group Assets under Management (AUM)
14% increase to
£2.4bn
(FY21: £2.1bn)
The above analysis excludes discontinued operations.
Underlying profit before tax2
£1.4m
(FY21: £1.5m)
Earnings per share
(basic from continuing operations)
Underlying earnings per share 2
(basic from continuing operations )
0.13p
(FY21: 2.47p)
2.34p
(FY21: 2.95p)
1 The comparative information for the year end 31 March 2021 has been restated to reflect the correct net gains on investment from revenue, further
details can be found in note 3 of these financial statements.
2 A reconciliation from underlying profits to statutory profits is shown within the financial review on page 9.
4
4
Divisional highlights
Wealth Management
Continued improvement in the quality
of the business over the year, with fee
income now representing
85% (FY21: 76%)
of total wealth management income
Successful completion of the integration
of Harpsden Wealth Management
98% of clients retained
WM total AUM remained at
Discretionary managed assets increased
by 6%
£1.6bn
(FY21: £1.6bn)
£1.02bn
(FY21: £0.96bn)
The above analysis excludes discontinued operations.
Capital Markets
Increase in total funds raised and in
average fund raise per transaction
Welcomed 21 new retained quoted
corporate clients to end year at
£236m/38 transactions
(FY21: £232m/42)
88
(FY21: 82)
Top 3
Nomad*
Top 3
Corporate Broker*
*Source Corporate Adviser Rankings Guide – May 2022
5
Chair and Chief Executive’s statement
“WH Ireland has had a year with growth in the number of
corporate clients and assets under management, set against a
number of well-publicised and evolving market challenges in
the second half that have been experienced by many
businesses. While there is no escaping the present difficult
backdrop, I am confident that the business will continue to
make progress to enable it to build from its solid foundations
once a clearer outlook is seen”.
Chair’s opening
paragraph
Chief Executive’s
statement
Market backdrop
The financial year began with another set of restrictions due to
the Covid-19 pandemic. Our employees continued to work
diligently and professionally throughout these difficult times,
ensuring our clients’ needs were met across all business areas.
Further global challenges emerged as the year progressed,
culminating in the war in Ukraine, and this created difficult
market conditions. We have adjusted well to these challenges,
but as already reported by many of our peers, these have
inevitably had a significant impact on activity levels in our
Capital Markets division.
The Financial Year 2022
Overall revenue for the Group was £32.0m (FY21 restated:
£28.7m*). Administrative expenses were £33.1m (FY21: £28.4m).
On a divisional basis, revenue in Capital Markets stood at
£16.2m (FY21 restated: £15.5m), despite the downturn in the
second half after a rise in income in the first six months of the
year. Wealth Management continued its improvement in the
quality of its earnings with an increase in the proportion of
assets under discretionary management. The division also
completed the full integration of its first acquisition, Harpsden.
Wealth management delivered revenue in the year of £15.8m
(FY21: £13.3m).
Clients
Our clients remain our priority and our central mission is to
continue providing excellent and improved service to our
corporate, institutional and private clients. I would like to take
the opportunity to thank all of our clients for their loyalty and
flexibility as we have continued to introduce change and
improvements during another year of challenges.
We believe that our platform now is starting to show the quality
of service that will continue to differentiate us in the future.
Employees
We have maintained our focus on our core people, while
continuing to attract new individuals and teams across both
divisions. Group headcount presently stands at 159, including
the addition of our Debt Capital Markets team and additional
corporate finance strength.
Building on solid foundations
It has been important to ensure that we build a strong central
expertise to support both divisions and our strengthened
capabilities in Finance, HR and Compliance equip us for
expansion. We were delighted in the first half of the year to
attract Simon Jackson to join the business as CFO and as a
member of the Board. We have recently welcomed Stephen
Balonwu to the executive team as Chief Risk and Compliance
Officer. This is a key role in ensuring that we conduct business
to the highest possible standards.
I would like to thank my fellow Board members and all
employees of the firm for their hard work and dedication during
the year. I am also grateful to Phil Shelley, our previous Chair, for
his dedication and commitment to the business over the past
two years.
*The comparative information for the year end 31 March 2021 has been restated to reflect the correct net gains on investment from revenue, further
details can be found in note 3 of these financial statements.
6
Phillip Wale
CEO
Looking forward
The calendar year has started in the grip of the conflict in the
Ukraine, with an almost unprecedented effect on markets,
volumes and transaction levels on AIM in particular. The
economic and global environment is probably as volatile and
testing as any I have experienced in my career. We therefore
remain cautious of the very short-term, but remain confident
that we are ready to take advantage of conditions when they
improve given our strengthened and improving platform across
both divisions. I would like to thank my colleagues who have
continued to work with real dedication to return the Company
to sustainable profitability, and I remain committed to working
with them to grow the business and rewarding shareholders for
their loyalty.
*Source Corporate Adviser Rankings Guide – May 2022
Chair and Chief Executive’s statement
Shareholders
I would like to thank our shareholders for their continuing support
as we continue to implement our strategy.
Wealth Management (WM)
We were delighted to attract Michael Bishop as Head of Wealth
Management during the year. Michael has most recently had a
senior role at UBS AG and has 22 years of experience in wealth
management. We are now focused on driving the WM business
from our four offices in London, Manchester, Henley and Poole,
and addressing the efficiency of the wider WM division with
renewed vigour.
Capital Markets (CM)
Our Equity Capital Markets (ECM) business strengthened its
position as a top AIM broker, climbing from number five to
number two*, while maintaining our top three ranking by client
numbers for the role of NOMAD. During the year the division
welcomed 21 new quoted corporate clients, acting for 88 at year-
end (FY21: 82), and we are pleased that this number has continued
to grow into the new financial year and is 94 at the date of this
report. These client relationships are key to our business and our
strategy and are the key driver of revenue in CM.
Away from public markets, we continued to raise capital for a
number of growing private company clients.
Gross transaction fees across CM in the 12-month period stood at
£10.0m (FY21 restated: £8.8m) and the average transaction size
increased as the team completed 38 transactions raising £236m
for clients (FY21: 42 and £232m respectively).
The drive to strengthen our capabilities continued into 2022,
diversifying our offering to clients with selective hires. This
continued in the new financial year with the creation of our Debt
Capital Markets (DCM) business. We completed our first DCM
transaction, as joint lead manager to EnQuest PLC following the
launch of its sterling denominated 9% guaranteed retail eligible
notes, which successfully raised £133m in April 2022.
Total Group AUM increased to £2.4bn (FY21: £2.1bn) including
£1.6bn in WM. WM discretionary managed assets increased by 6%
to £1.02bn (FY21: £0.96bn)
*The comparative information for the year end 31 March 2021 has been restated to reflect the correct net gains on investment from revenue, further
details can be found in note 3 of these financial statements.
*Source Corporate Advisers Ranking Guide – May 2022
7
Financial review
Overview
The WH Ireland Group has two principal operating subsidiaries, WH Ireland Limited and Harpsden Wealth Management Limited.
WH Ireland Limited consists of two business divisions: Wealth Management (WM), which provides wealth management solutions
and independent financial advisory services to retail clients and Capital Markets (CM), which provides a range of capital markets
services to both public and private companies, day-to-day and strategic corporate advice, broking, trading and equity research to
Funds, High Net Worth individuals and Family Offices.
Total assets managed by the Group are £2.4bn (FY21: £2.1bn). Of this total, £1.6bn is held in WM with a further £0.7bn within CM’s
Ultra High Net Worth business.
The Group’s income is predominantly derived from activities conducted in the UK with a number of retail, high net worth, ultra-high
net worth, family office, institutional and corporate clients.
The average Group headcount for the year was 158 (FY21: 139) in the UK.
Strategy summary
The Group’s strategic focus is on becoming a leading advice-driven wealth management service provider to retail clients and the
leading capital markets business in the growth company market place. In WM the Group aims to improve the value of discretionary
assets under management using our enhanced capabilities and customer proposition as well as through add-on acquisitions. In CM
the strategy is to focus on growing our corporate client list by investing in new teams and sector capability that build on our already
strong distribution in public and private markets. During the year we acquired an experienced debt capital markets team who will
further enhance the service we are able to offer to our clients. Together this will grow revenue and profitability significantly as well
as maximising the Group’s recurring revenue as wealth management fees and corporate retainers increase.
Group financial results summary
Revenue
Administrative expenses
Expected credit loss
Operating (loss)/profit
Net gains on investments
Finance income
Finance expense
Profit before tax
Taxation
Profit from continuing operations
Loss from discontinued operations
Profit and total comprehensive income for the year
Year to
31 Mar 2022
£'000
32,035
(33,062)
(81)
(1,108)
Year to
31 Mar 2021
£'000
28,741*
(28,390)
(28)
323
1,626
1
(511)
8
67
75
-
75
818
2
(96)
1,047
192
1,239
(86)
1,153
*Comparative figures have been restated to reflect the reclassification of net gains on investments for the 12 months to 31 March 2021. See note 3 for further details
8
Financial review
Reconciliation between underlying and statutory profits
Underlying profit before tax is considered by the Board to be an accurate reflection of the Group’s performance when compared to
the statutory results, as this excludes income and expense categories which are deemed of a non-recurring nature or non-cash
operating item. Reporting at an underlying level is also considered appropriate for external analyst coverage and peer group
benchmarking. A reconciliation between underlying and statutory profit before tax for the year ended 31 March 2022 with
comparative is shown below
Underlying profit before tax
Acquisition related items
- Deal structuring and integration costs
Amortisation of acquired brand and client relationships
Changes in fair value and finance cost of deferred consideration
Dual running of operating platform costs
Restructuring costs
Net changes in the value of non-current investments
Total underlying adjustments
Statutory profit before tax
Underlying earnings per share
Weighted average number of shares in issue during the period (note 12)
Basic underlying earnings per share
Year to
31 Mar 2022
£'000
1,397
Year to
31 Mar 2021
£'000
1,481
(446)
(505)
(416)
-
(835)
813
(1,389)
8
59,692
2.34p
(465)
(219)
-
(35)
(129)
414
(434)
1,047
50,249
2.95p
Deal restructuring and integration costs
These represent costs incurred in relation to the acquisition of Harpsden and include the integration and retention costs of staff and
the costs of the transfer of assets on to the SEI operating platform.
Amortisation of acquired brand and client relationships
These intangible assets are created in the course of acquiring funds under management and are amortised over their useful life
which have been assessed between 2 to 12 years. This charge has been excluded from underlying profit as it is a significant non-
cash item.
Changes in fair value and finance cost of deferred consideration
This comprises the fair value measurement arising on the deferred consideration payments from acquisitions together with the
associated finance costs from the unwinding of the present value discount relating to the Harpsden acquisition.
Restructuring costs
These costs relate to the restructuring costs within both WM and CM and the resultant costs of redundancies of staff in the London
office and arising from the closure of the Cardiff office.
Net changes in value of investments
As part of the fee arrangement with corporate clients in CM, there is often a grant of warrants over shares or the issue of actual shares
in addition to the cash element of the fee. The value of such warrants and shares are credited to revenue on the date of the fee note
and then any changes in the valuation are recorded as net gains. In view of the nature of these gains, including non-cash, these gains
have been excluded from underlying profit. Corresponding commission payable on the gain of these warrants are included in the
net changes above.
9
Financial review
Revenue
Wealth Management
The Wealth Management Division incorporates both investment management services and financial planning advice from offices in
London, Manchester, Poole and Henley. Since the year end the lease for the Cardiff office was not renewed and staff and clients have
transferred and are now managed from Poole.
The strategy for the ongoing growth in this division is to focus our efforts on growing the number of discretionary portfolios. This will
be achieved by a mixture of organic growth through new business initiatives, continued personal referrals and the movement of
existing advisory and execution clients to our discretionary service as well as the selective recruitment of individuals and teams with
existing client relationships and further corporate acquisitions of quality Wealth Management businesses.
Total WM AUM at 31 March 2022 was £1.6bn (FY21: £1.6bn) as detailed in the table below. The majority of client assets are managed
on the SEI platform with a small balance of ex Harpsden clients remaining on another third party platform.
Discretionary funds grew in total 6.2% over the year despite negative market movements with strong flows of net new business of
£64.9m (FY21: £15.7m) representing 6.7% of opening funds (FY21: 2.9%) with an additional £17.4m of assets moving to the
discretionary service over the year.
WM funds flow table for the year:
As at 1 April 2021
Inflows
Outflows
Service switches
Market Performance
SEI at 31 March 2022
External platforms
Discretionary
£m
959.3
129.8
(64.9)
17.4
(22.1)
1,019.5
-
Advisory
£m
Execution Only
£m
Custody*
£m
131.8
9.1
(14.3)
(40.7)
(1.1)
84.8
41.1
361.7
56.6
(111.5)
23.3
32.8
362.9
-
113.0
11.0
(18.1)
-
(4.7)
101.2
-
Total
£m
1,565.8
206.5
(208.8)
-
4.9
1,568.4
41.1
Total WM AUM at 31 March 2022
1,609.5
*Custody represents discretionary managed assets held on our SEI platform by New Horizons LLP a company with whom revenues are shared.
Note that growth in discretionary assets under management is represented by the sum of net inflows, net service switches and market
performance.
1,019.5
362.9
125.9
101.2
It was a challenging year for investors, particularly in H2. However total WM revenue for FY22 increased by 19.2% to £15.8m (FY21:
£13.3m) with a significant increase in management fees and wealth planning of 34.7% including the first full year of contribution
from Harpsden. Market conditions impacted on trading activity resulting in a reduction of commission revenue in the year of 28.6%
to £2.2m (FY21: £3.1m)
Management fees and wealth planning
Commissions
Other
Total
2022
£’000
13,549
2,221
67
15,837
2021
£’000
10,056
3,110
125
13,291
10
Financial review
Capital Markets
Our Capital Markets Division is specifically focused on the public and private growth company marketplace. The team’s significant
experience in this dynamic segment means that we are able to provide a specialist service to each of its respective participants. For
companies, we raise public and private growth capital, as well as providing both day-to-day and strategic corporate advice. Our
tailored approach means that our teams engage with all of the key investor groups active in our market - High Net Worth Individuals,
Family Offices, Wealth Managers and Funds. Our broking, trading and research teams provide the link between growth companies
and this broad investor base. Total CM AUM at 31 March 2022 was £0.8bn (FY21: £0.5bn). The client assets are managed on the
Pershing platform and the majority are held as execution only.
Total revenue for the year increased by 4.7% to £16.2m (FY21 restated: £15.5m) with a strong H1 but more challenging market
conditions in H2, particularly in the last quarter of the financial year which impacted on activity levels and the number of
transactions. An increased number of retained clients of 88 at the year-end (FY21: 82) and the completion of five successful IPOs
(compared to two in the previous period) were the drivers for the 12.4% increase in retainer fees to £3.8m (FY21: £3.4m) and the
13.4% increase in transaction fees respectively. CM also executed a wide range of advisory work for its clients although trading and
commission revenue fell by 26.2% year on year reflecting the market conditions and lower activity levels.
Transaction fees
Retainer fees
Equity Commissions and Trading
Total
2022
£’000
9,979
3,769
2,450
16,198
2021
£’000
8,796*
3,353
3,318
15,467
*Comparative transaction fees have been restated to reflect the reclassification of net gains on investments from revenue for the 12 months to 31 March 2021.
Transaction fees are further analysed as follows:
IPOs
Secondary equity issues
Other revenue incl. advisory and M&A
Total
2022
£’000
1,878
4,311
3,790
9,979
2021
£’000
2,946
3,891
1,959
8,796
11
Financial review
Expenses
Total operational costs increased by 16.4% with the inclusion of Harpsden for a full year compared to three months in FY21.
Following the Harpsden acquisition, 19 new members of staff joined which was the main reason behind the increase in fixed people
costs. Variable people costs, mainly related to bonus payments have reduced by 26.1% to £3.1m (FY21: £4.2m) in line with the
reduction in profitability of the group.
Cost of sales – third party commissions
Fixed non-people costs
Fixed people costs
Variable people costs
Total
2022
£’000
4,895
10,464
14,577
3,126
33,062
2021
£’000
4,301
8,869
10,988
4,232
28,390
Financial position and regulatory capital: Net assets increased slightly to £15.4m at 31 March 2022 (FY21: £15.1m) and tangible net
assets (net assets excluding intangible assets and goodwill) increased by 11.7% to £7.6m (FY21: £6.8m).
The Investment Firms Prudential Regime (IFPR) came into effect on 1 January 2022 and applies to all solo-regulated MiFID
investment firms and WH Ireland is a non-SNI (small and non-interconnected) MIFIDPRU investment firm.
As a result of this change the Group’s regulatory capital requirement is its fixed overhead requirement as defined by the Financial
Conduct Authority (“FCA”). Due to the increase in these costs arising from the acquisition of Harpsden the Group has seen its
regulatory capital surplus reduce during the year. However, the Directors have reviewed the forward-looking position as part of the
going concern modelling and stress testing and believe that the regulatory requirements will be met as well as having a management
action plan for cost reductions should this be necessary to address a stress scenario.
12
Financial review
Key Performance Indicators
The following financial and strategic measure have been identified as the key performance indicators (“KPIs”) of the Group’s overall
performance for the financial year.
1. GROUP ASSETS UNDER MANAGEMENT
The total value of funds under management has a direct
impact on the Group’s revenue
+14%
n
b
£
2.50
2.00
1.50
1.00
0.50
-
FY 2020
FY 2021*
FY 2022
*FY 2021 Includes acquisition of Harpsden Wealth Management Limited
2. NUMBER OF RETAINED CAPITAL MARKETS CORPORATE
CLIENTS
The number of retained clients has a direct relationship to the
value of fees earned from success fees and retainer income in
Capital Markets
+7.3%
3. TOTAL REVENUE
The amount of revenue generated by Wealth Management
and Capital markets together is one of the key growth
indicators
+11.4%
90
85
80
75
70
65
40
30
20
10
0
m
£
FY 2020
FY 2021
FY 2022
FY 2020
FY 2021*
FY 2022
*FY 2021 revenue has been restated to reflect the reclassification from revenue
to net gains on investments
4. DISCRETIONARY AND ADVISORY ASSETS UNDER
MANAGEMENT (WM)
Discretionary and advisory funds are the main income driver
for our Wealth Management business
+4.9%
n
b
£
1.2
1
0.8
0.6
0.4
0.2
0
FY 2020
FY 2021*
FY 2022
*FY 2021 Includes acquisition of Harpsden Wealth Management Limited
13
Financial review
Dividends
The Board does not propose to pay a dividend in respect of the financial year (FY21: £nil).
Statement of Financial Position and Capital Structure
Maintaining a strong and liquid statement of financial position remains a key objective for the Board, alongside its regulatory capital
requirements. Total net assets were £15.4m (FY21: £15.1m) and net current assets £3.9m (FY21: £5.8m). Cash balances at year-end
were £6.4m (FY21: £8.2m).
Risks and Uncertainties
Risk appetite is established, reviewed and monitored by the Board. The Group, through the operation of its Committee structure,
considers all relevant risks and advises the Board as necessary. The Group maintains a comprehensive risk register as part of its risk
management framework encouraging a risk-based approach to the internal controls and management of the Group. The risk
register covers all categories including human capital risk, regulatory risk, conduct (client) risk, competition, financial risk, IT and
operational resilience risk and legal risk. Each risk is ranked on impact and likelihood and mitigating strategies are identified. In
addition, the Executive Committee which is formed of the Executive Directors, the Heads of the business divisions, a representative
from HR and Chief Risk and Compliance Officer meet to assess and monitor these. An Executive Risk Committee has recently been
established to manage and monitor risks and report into the Board.
The Group has outsourced its internal audit function to Deloitte since April 2021. Deloitte formally report to Tom Wood, Chair of the
Audit Committee with Stephen Balonwu, Chief Risk and Compliance Officer, being the principal day to day contact.
Liquidity and capital risk
The Group continues to focus on managing the costs of its business and returning to growth and sustainable profitability whilst
increasing the proportion of recurring revenue with CM and the building of its discretionary fee paying client base in WM to better fit
the regulatory environment in which it operates.
To mitigate risk, the Board continues to focus on ensuring that the financial position remains robust and suitably liquid with
sufficient regulatory capital being maintained over the minimum common equity tier 1 capital requirements. Regulatory capital and
liquid assets are monitored on a daily basis.
Operational risk
Operational risk is the risk of loss to the Group resulting from inadequate or failed internal processes, people and systems, or from
external events.
Business continuity risk is the risk that serious damage or disruption may be caused as a result of a breakdown or interruption, from
either internal or external sources, of the business of the Group. This risk is mitigated in part by the number of branches across the
UK and the Group having business continuity and disaster recovery arrangements including business interruption insurance.
The Group seeks to ensure that its risk management framework and control environment is continuously evolving which
Compliance and Risk monitor on an ongoing basis.
Credit risk
The Board takes active steps to minimise credit losses including formal new business approval, and the close supervision of credit
limits and exposures and the proactive management of any overdue accounts. Additionally, risk assessments are performed on an
ongoing basis on all deposit taking banks and custodians and our outsourced relationships.
Regulatory risk
The Company operates in a highly regulated environment in the UK. The Directors monitor changes and developments in the
regulatory environment and ensure that sufficient resources are available for the Group to implement any required changes. The
impact of the regulatory environment on the Group’s management of its capital is discussed in note 28 of the financial statements.
Section 172 Statement
Broader Stakeholder Interests
Directors of the Group must consider Section 172 of the Companies Act 2006 which requires them to act in the way that would most
likely promote the success of the Group for the benefit of all its stakeholders. The Board and its committees consider who its key
stakeholders are, the potential impact of decisions made on them taking into account a wider range of factors, including the impact
on the Company’s operations and the likely consequences of decisions made in the long term. The Group’s key stakeholders and
how the Board and the Group have engaged with them during the year is set out below.
14
Financial review
Employees
The CEO and his management team on behalf of the Board engage with employees through a variety of methods including periodic
all staff notifications of updates, information and points of interest, staff forums, group meetings and Town Hall meetings. Further
details can be found in the corporate social responsibility section on page 29.
Shareholders
Our shareholders have been pivotal in supporting the Group and its new management team and Board. The Board recognise and
frequently discuss the importance of good, open and constructive relationships with both new potential as well as existing
shareholders and is committed to this communication. The way in which this has been achieved during the year has been by our
Chief Executive Officer, supported by the management team, maintaining regular contact and meetings with individual and
institutional shareholders, both existing and potential, and communicating and discussing shareholders’ views with the Board. A
number of Board members and employees also hold the Group’s shares and regular communications are provided. The Group’s
strategy and results are presented to shareholders through meetings following announcements of the final and interim results.
Shareholders are also invited to meet the Board and management team, who attend, the Annual General Meeting. The annual
report and accounts for the year ended 31 March 2022 along with all past accounts, regulatory communications and other material
is set out on the Group’s website at https://www.whirelandplc.com/investor-relations.
Regulators
The Board recognises the past history of the Group in this regard and is absolute in its insistence on continuous and open
communication with our regulators at the FCA as well as with the London Stock Exchange. Regular ongoing dialogue has continued
through the CEO and CFO with the FCA who receive regular Management information. The FCA have approved the appointments of
each member of the new Management team and the Board members as required.
Clients
Our clients are fundamental to the business of the Group and the Board recognise that their interests are of paramount importance.
Management of WM and CM closely engage with clients to understand their objectives so that the service provided by the business
is appropriate. In WM the client’s profile and the suitability of the investment strategy provided is frequently challenged by our
professional investment managers and this is supplemented by a second line of review from management and our compliance
team. It is recognised that the status of our clients can and does change in line with the environment and vulnerable clients in
particular are identified and discussed at management and at Committee level to ensure that they are provided with the best
possible advice.
In CM the Group’s objective is also to achieve the best outcome and this applies equally to institutional corporate clients. Regular
contact is maintained with them across all departments including corporate broking, corporate finance, trading and research. Our
investor relations team arranges meetings with investors, undertakes site visits and organises events for a wide range of our clients’
teams.
Community and Suppliers
The Board through its Executive Directors is keenly focused on its key supplier relationships especially those of an outsourced
relationships and regularly challenges and reviews its arrangements. The Group openly encourages its offices and employees to
engage in local charitable, community groups and other causes. Further detail can be found on page 32.
Each of the Board members consider that they have acted together, in good faith in a way most likely to promote the success of the
Group for the benefit of its broader range of stakeholders as a whole taking into account section 172 (1) (a-f) of the Companies Act
2006.
The Strategic Report on pages 6 – 15 has been approved by the Board and signed on its behalf by:
S Jackson
Chief Finance Officer
July 2022
15
Directors’ report
The Directors present their annual report on the affairs of the Group, together with the financial statements and Independent
Auditors’ Report, for the year ended 31 March 2022.
Going concern
The financial statements of the Group have been prepared on a going concern basis. In making this assessment, the Directors have
prepared detailed financial forecasts for the period to September 2023 which consider the funding and capital position of the Group.
Those forecasts make assumptions in respect of future trading conditions, notably the economic environment and its impact on the
Group’s revenues and costs. In addition to this, the nature of the Group’s business is such that there can be considerable variation
in the timing of cash inflows. The forecasts take into account foreseeable downside risks, based on the information that is available
to the Directors at the time of the approval of these financial statements.
The Directors have conducted full and thorough assessments of the Group’s business and the past financial year has provided a
thorough test of those assessments and the resilience of the business. The significant market turbulence particularly in H2 resulting
from the Russian invasion of Ukraine presented a range of challenges to the business. The business reacted well and with increasing
levels of recurring revenue supplementing a buoyant performance by CM delivering a profit for the twelve months.
Whilst there always remains uncertainty over what the future impact will be on the economy, the business has improved its
resilience. By executing its first acquisition WM has increased the total value of assets under management, and importantly the
proportion of that total represented by discretionary managed assets. CM has been appointed by several new clients and completed
a record number of IPOs.
Certain activities of the Group are regulated by the Financial Conduct Authority, the statutory regulator for financial services business
in the UK which has responsibility for policy, monitoring and discipline for the financial services industry. The FCA requires the
Group’s capital resources to be adequate; that is sufficient in terms of quantity, quality and availability, in relation to its regulated
activities. The Directors monitor the Group’s regulatory capital resources on a daily basis and they have developed appropriate
scenario tests and corrective management plans which they are prepared to implement to address any potential deficit as required.
Further actions open to the Directors include incremental cost reductions, regulatory capital optimisation programmes or further
capital raising.
An analysis of the potential downside impacts was conducted as part of the going concern assessment to assess the potential
impact on revenue and asset values with a particular focus on the variable component parts of our overall revenue, such as
corporate finance fees and commission. Furthermore, reverse stress tests were modelled to assess what level the Group’s business
would need to be driven down to before resulting in a liquidity crisis or a breach of regulatory capital. That modelling concluded
that transactional, non-contractual revenue would need to decline by more than 70% from management’s forecasts to create such
a crisis situation within eighteen months’ time.
Based on all the aforementioned, the Directors believe that regulatory capital requirements will continue to be met and that the
Group has sufficient liquidity to meet its liabilities for the next twelve months and that the preparation of the financial statements
on a going concern basis remains appropriate.
Likely future developments
The initial stages of turning around the Group focussed on the reduction of costs to not only a lower absolute level but further, to
reduce the proportion of total costs represented by fixed costs burdening the business. Total costs for the Group have increased
over the year due to the acquisition of Harpsden however further reductions have been identified and management are resolute in
their commitment to implement these savings. The elimination of legacy systems in both divisions has resulted in a simpler and less
risky business model that is well positioned to support a growing business, as stated in the chief executive’s statement, the next
stages include continuing to grow the business in the coming year.
Financial instruments and risk management
Details of risks and risk management arising from the Group’s financial instruments are set out in note 27 of the financial statements.
16
Directors’ report
Directors
The Directors who held office during the year and their interest in the shares of the Company were as follows:
S N Lough
P A Wale
S J Jackson (appointed 14 February 2022)
H Sinclair (appointed 4 May 2021)
T Wood (appointed 20 September 2021)
P Tansey (resigned 31 December 2021)
S Ford (resigned 31 January 2022)
V G Raffé (resigned 12 August 2021)
P J Shelley(resigned 25 April 2022)
A G Buchanan (resigned 30 September 2021)
Year ended
31 Mar 2022
Number of shares
479,544
171,295
-
6,125
44,444
N/A
N/A
N/A
Year ended
31 Mar 2021
Number of shares
464,999
130,000
N/A
N/A
N/A
18,000
479,217
54,165
1,549,150
N/A
1,458,409
218,749
Further details of Directors’ service contracts, remuneration, share interests and interests in options over the Company’s shares can
be found in the Remuneration Report on page 37.
Major Shareholdings
At the date of publication of this report, the Company had been notified of the following shareholdings (other than those of the
Directors) of 3% or more of the share capital:
Polygon Global Partners LLP*
Oceanwood Capital Management LLP
Mountain Berg Limited
Hargreave Hale Limited
M & G Investments Limited
Sanne Fiduciary Services Limited (as trustee for the WHI ESOT)
M Lawson
*including 1,310,278 held by way of Contracts for Difference
Ordinary
shares
18,576,022
6,869,097
6,145,000
3,789,583
3,055,000
2,839,500
2,835,646
%
29.95
11.08
9.90
6.11
4.92
4.60
4.57
As set out above, the Company’s Employee Share Ownership Trust (ESOT), the trustee for which is Sanne Fiduciary Services Limited,
held 2,839,500 shares (FY21: 2,189,500), at a nominal value of 5p per share . All rights to receive dividends in respect of these shares
have been waived. Further details are in notes 30 and 31 of the Financial Statements. On 18 May 2021 the ESOT, for which Sanne is
the trustee, entered into an ESOT Share Purchase Plan (The Plan) to acquire ordinary shares of 5p in the capital of the Company. It
is the Company’s and the ESOT’s intention that any ordinary shares acquired will be used to satisfy the awards made to employees
of the Company or the Group. Purchases will be limited to a maximum of 50,000 shares or a maximum value of £40,000 each month
and the Plan, unless renewed, will terminate on 1 May 2023.
Dividends
No dividends were paid during the year (FY21: nil).
Political Contributions
The Group and Company did not make any political donations or incur any political expenditure during the year (FY21: nil).
Qualifying Third Party Indemnity Provisions
The Company has arranged qualifying third party indemnity for all of its directors.
Employees
Our employees are vital to the success of the Group. The Group and its employees are committed to delivering a quality service
which meets our own expectations, those of the FCA and those of our clients wherever possible.
17
Directors’ report
Employees are kept informed and consulted regularly on key issues affecting them and the Group by the intranet and through
regular communication between management and staff.
The Company policy is to give full and fair consideration to all disabled people who apply for employment and seeks to develop the
skills and potential of disabled people, affords them access to training and promotion opportunities and, makes every effort to
retain in suitable employment those staff who may become disabled whilst in the employment of the Group.
Annual General Meeting (AGM)
The resolutions being proposed at the AGM include usual resolutions dealing with the ordinary business of the AGM together with
certain additional special business. A description of all the resolutions is set out within the Notice of AGM document.
Auditors
The Directors who held office at the date of approval of this Directors’ Report confirm that, so far as they are each aware, there is no
relevant audit information of which the Company’s auditors are unaware and each Director has taken all the steps that they ought
to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company’s auditors
are 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.
The auditors, RSM UK LLP have indicated their willingness to continue in office, and a resolution that they will be re-appointed will
be proposed at the AGM.
18
Directors’ report
Directors’ Biographies
Phillip Wale
Chief Executive Officer
Phillip began his career in UK Gilt Edged & convertible bonds, spending ten years at Goldman Sachs in
New York and then London, as co-head of pan-European equities. He managed the equity businesses
at Commerzbank and then at Knight Securities, where he was appointed European CEO. In 2004 he
moved into fund management as CIO of a multi-strategy hedge fund, returning to the sell-side in 2007
with Collins Stewart working closely with the expansion of the wealth management product. Phillip
joined Seymour Pierce, the corporate & institutional broker and wealth manager, in 2010 and was
appointed its Chief Executive Officer in 2011. Between 2012 and 2016 he was Chief Executive Officer of
Panmure Gordon & Co. Prior to joining WH Ireland in August 2018, Phillip was Head of Fixed Income
(Europe) at Cantor Fitzgerald Europe.
Simon Jackson
Chief Financial Officer
Simon was Finance Director of Saunderson House Limited from January 2019 until March 2021, prior
to its acquisition by Rathbone Brothers Plc, having previously been Group Finance Director of Brooks
Macdonald Group plc from November 2000 to April 2018. In both roles he helped implement both
organic and inorganic growth strategies whilst building finance capabilities that are essential to meet
the increasing requirements of a growing, regulated business in public markets. Simon’s time at
Brooks Macdonald included its admission to trading on AIM in 2005; between 2005 and 2017, Brooks
Macdonald grew its funds under management from £371m to £11.7bn. Simon qualified as a chartered
accountant with Macintyre Hudson, and spent 10 years with Rutland Trust plc, in a variety of senior
finance roles, prior to joining Brooks Macdonald.
Simon Lough
Chair
After graduating from Oxford University, Simon joined Kleinwort Benson in 1984, moving to work in
their Tokyo office in 1986. In 1991, he joined Banca della Svizzera Italiana, working in Tokyo and then
their London office. In 1996, Simon left investment banking, joining, and co-investing, in the forerunner
of the Heartwood wealth management business. His managerial role initially entailed establishing a
London office for the growing business. He subsequently headed both the client and investment
teams, before becoming Chief Executive in November 2008. In May 2013, Heartwood became a wholly
owned subsidiary of Handelsbanken and Simon continued as Chief Executive until July 2014 and
subsequently left on the third anniversary of its acquisition.
From 2013-16, he was also a member of the Financial Conduct Authority’s Smaller Business
Practitioner Panel, nominated by the Wealth Management Association (now called PIMFA – Personal
Investment Management & Financial Advice Association) to represent the wealth management sector.
19
Directors’ report
Helen Sinclair
Non-Executive Director
Helen has a degree in Economics from Cambridge and an MBA from INSEAD business school. She
began her career in investment banking and then moved into private equity investment at 3i. Helen is
a highly experienced non-executive director having served on a number of audit, remuneration and
investment committees. Prior to her focus on non-executive director roles, Helen co-founded and ran
Matrix Private Equity (which became Mobeus Equity Partners LLP); a successful private equity firm, with
a focus on SMEs. Helen has a thirty-year track record as an investor, board member and board observer
in a range of sectors, including early stage technology/digital media, retail and consumer and financial
services with considerable expertise in alternative asset management.
Tom Wood
Non-Executive Director
Tom is a highly experienced CEO/CFO who has operated in senior leadership roles within Banking and
Regulated Financial Services. Tom was Chief Restructuring and Financial Officer of the Co-operative
Bank plc (2017-2019) having advised on its third recapitalisation. Prior to this Tom was CFO and Interim
CEO of Shawbrook Group plc leading the IPO of the business in 2015.
More recently Tom has advised PE funds and investors in financial services in respect of M&A and
transformational growth.
The Directors’ report is approved by the Board on 26 July 2022 and signed on its behalf by:
S Jackson
Director
20
Corporate governance report
The Directors of the Company have always endeavoured to apply the appropriate and proportionate level of Corporate Governance,
and has done so by seeking to comply with the QCA Corporate Governance Code for Smaller Companies. On 8 March 2018, the
London Stock Exchange issued revised rules for AIM-quoted companies, within which there is a requirement for AIM quoted
companies to apply a recognised corporate governance code from September 2018 and incorporate details of how it complies with
that Code in both its Annual Report and on its website.
The Company has chosen to apply the QCA Corporate Governance Code published in April 2018 (the “QCA Code”) and this Corporate
Governance report is based upon the QCA Code.
The principal means of communicating the Company’s application of the QCA Code is the Company’s most recent Annual report
(pages 21 to 28), a copy of which can also be found in the Corporate Governance section of the Company’s website
(www.whirelandplc.com)
This statement has been collectively prepared by the Board of Directors of the Company (the “Board”). The Board refers to the QCA
Corporate Governance Code as a useful guide to assist in articulating how the Company approaches and applies good corporate
governance.
This report sets out the Company’s application of the Code, by the Board, and where appropriate, cross references other sections
of the Annual Report. Where the Company’s practices depart from the expectations of the Code, the Board has given an explanation
as to why.
The QCA Code is constructed around ten broad principles and a set of disclosures which notes appropriate arrangements for
growing companies and requires companies who have adopted the QCA Code to provide an explanation about how they are
meeting those principles through the prescribed disclosures. In the table below, the Board explains how it has applied them.
QCA Code Principle:
Establish a
1
strategy and
business model
which promote
long-term value
for shareholders
How it should be applied:
The board must be able to express a shared
view of the company’s purpose, business
model and strategy. It should go beyond the
simple description of products and corporate
structures and set out how the company
intends to deliver shareholder value in the
medium to long-term. It should demonstrate
that the delivery of long-term growth is
underpinned by a clear set of values aimed at
protecting the company from unnecessary
risk and securing its long-term future.
How the Company applies it:
Page 16 of the Company’s Annual Report for the period
ended 31 March 2022 sets out its principal strategy, which
is to focus on continuing to grow the business across the
two business divisions of Wealth Management and
Capital Markets, with the ultimate objective of becoming
the corporate broker of choice in the small and mid-cap
company segment and a leading advice-driven wealth
management service provider to retail clients.
The risks that attach to this strategy and how such risks
are mitigated are set out at pages 14 of WHI’s annual
report for the period ended 31 March 2022.
2
Seek to
understand and
meet
shareholder
needs and
expectations
develop
Directors must
good
understanding of the needs and expectations
of all elements of the company’s shareholder
base.
a
The board must manage shareholders’
expectations and should seek to understand
the motivations behind shareholder voting
decisions
is at
for the Board to meet
the Company’s AGM, which
The Board is committed to regular shareholder dialogue
with both its institutional and retail shareholders.
The principal opportunity
shareholders
shareholders are encouraged to attend.
The Company also has a dedicated email address which
the Company
investors
(enquiries@whirelandplc.com. The CEO is responsible for
reviewing
from
communications
shareholders and determining the most appropriate
response.
can use
received
contact
all
to
21
Corporate governance report
3.
Take into
account wider
stakeholder and
social
responsibilities
and their
implications for
long-term
success
Long-term success relies upon good
relations with a range of different
stakeholder groups both internal
(workforce) and external (suppliers,
customers, regulators and others). The
board needs to identify the company’s
stakeholders and understand their needs,
interests and expectations.
Where matters that relate to the company’s
impact on society, the communities within
which it operates or the environment have
the potential to affect the company’s ability
to deliver shareholder value over the
medium to long-term, then those matters
must be integrated into the company’s
strategy and business model.
Feedback is an essential part of all control
mechanisms. Systems need to be in place to
solicit, consider and act on feedback from all
stakeholder groups
4.
Embed effective
risk
management,
considering
both
opportunities
and threats,
throughout the
organisation
The board needs to ensure that the
company’s risk management framework
identifies and addresses all relevant risks in
order to execute and deliver strategy;
companies need to consider their extended
business, including the company’s supply
chain, from key suppliers to end-customer.
Setting strategy includes determining the
extent of exposure to the identified risks that
the company is able to bear and willing to
take (risk tolerance and risk appetite).
time
Company
dedicates
significant
The Company’s assessment of its key resources and
relationships is set out on page 14 of WHI’s annual report
for the period ended 31 March 2022.
The Directors believe that, in addition to its shareholders,
the main stakeholders of the Company are its clients, its
employees, the communities in which it operates and its
two regulatory bodies (the London Stock Exchange and
the FCA).
The
to
understanding and acting on the needs and requirements
of each of these groups by way of meetings dedicated to
obtain feedback.
The Company is also a member of certain organisations,
such as
the Quoted Companies Alliance, which
encourages and facilitates active dialogue with some of
the Company’s key stakeholders.
Linked to this, the Company endeavours to build
relationships with those local communities in which it
operates and some of those initiatives it has invested in,
in recent years, are set out in the Company’s CSR section
of its website.
At the same time the Company is endeavouring to adopt
an Environmental, Social and Governance
(“ESG”)
framework within the next twelve months incorporating
objectives to minimise the Company’s environmental
impact; to engage staff and suppliers and to build on the
CSR initiatives the Company is already working on to
more broadly support the communities in which we
operate.
Page 14 of the Company’s Annual Report for the period
ended 31 March 2022 set out the risks to the Company’s
business and outlook, and how such risks are minimised.
Given the areas in which the Company operates, risk is a
particular focus.
The Company employs a Chief Risk and Compliance
Officer, which is a full time position within the Company
and who is tasked with risk identification, assessment,
management and the measurement of risk and threats to,
the business. These risks are recorded within the
Company’s risk register and cover all categories including
human capital risk, regulatory risk, conduct (client) risk,
competition, financial risk, IT and operational resilience
risk and legal risk.
Each risk is ranked on impact and likelihood and
mitigating strategies are identified.
In addition, the Executive Committee which is formed of
the Executive Directors, the Heads of the business
divisions, a representative from HR and the Chief Risk and
Compliance Officer meet to assess and monitor these
risks; and discuss any new emerging risks arising in the
day to day business.
from the Executive
The risk register and minutes
Committee are reviewed in Board meetings. The Directors
receive progress reports from the Head of Compliance
and Risk directly, to enable them to assess the
effectiveness of the systems in place.
22
Corporate governance report
5. Maintain the
board as a well-
functioning,
balanced team
led by the chair
The board members have a collective
responsibility and legal obligation to
promote the interests of the company, and
are collectively responsible for defining
corporate governance arrangements.
Ultimate responsibility for the quality of, and
approach to, corporate governance lies with
the chair of the board.
The board (and any committees) should be
provided with high quality information in a
timely manner to facilitate proper
assessment of the matters requiring a
decision or insight.
The board should have an appropriate
balance between executive and non-
executive directors and should have at least
two independent non- executive directors.
Independence is a board judgement.
The board should be supported by
committees (e.g. audit, remuneration,
nomination) that have the necessary skills
and knowledge to discharge their duties and
responsibilities effectively.
Directors must commit the time necessary
to fulfil their roles.
6
Ensure that
between them
the directors
have the
necessary up-
to-date
experience,
skills and
capabilities
The board must have an appropriate
balance of sector, financial and public
markets skills and experience, as well as an
appropriate balance of personal qualities
and capabilities. The board should
understand and challenge its own diversity,
including gender balance, as part of its
composition.
The board should not be dominated by one
person or a group of people. Strong
personal bonds can be important but can
also divide a board.
As companies evolve, the mix of skills and
experience required on the board will
change, and board composition will need to
evolve to reflect this change
All strategic decisions are decided by the Board acting
collectively.
The Board consists of three Non-Executive Directors and
two Executive Directors. It is considered that Simon
Lough, Helen Sinclair and Tom Wood are independent
Non-Executive Directors.
All Executive Directors are full time Directors of the
Company and the Non-Executive Directors are expected
to commit at least one day a month to the Company in
addition to their attendance at board meetings.
The Board meets 11 times a year; the Audit Committee
and Risk Committee meet 5 times a year and the
Remuneration Committee meets at least twice a year (and
also as required). All meetings during the period under
review were fully attended with the exception of:
October 2021 board meeting where Stephen
Ford sent apologies;
November 2021 board meeting where Philip
Tansey sent apologies;
December 2021 audit committee where Helen
Sinclair sent apologies; and
June 2021 risk committee meeting where Alistair
Buchanan sent apologies.
Board minutes and related papers are circulated to
Directors in good time ahead of the relevant Board
meeting(s).
The Board has established Audit, Remuneration, Risk,
Nomination and Executive committees which meet
regularly in accordance with their terms of reference. The
details of these committees, including their terms of
reference and composition, are set out below, in this
Corporate Governance Report.
The Company has five directors being Phillip Wale, Simon
Jackson, Simon Lough, Helen Sinclair and Tom Wood.
Collectively, the directors possess experience in the
following areas Finance, Legal, M&A and restructuring.
Their relevant experience, skills and personal qualities are
set out at pages 19 to 20 of the Company’s Annual Report
for the period ended 31 March 2022.
The Company periodically holds briefings
for the
Directors covering regulations that are relevant to their
role as Directors of an AIM-quoted company.
The Company has dedicated Human Resources and
Compliance departments and also uses the services of a
number of external training providers. The Directors
therefore have access to certain in-house seminars and
external training courses to assist the Directors in keeping
their skills are kept up to date.
The Board is supported by Katy Mitchell as Company
Secretary and Head of Legal. Katy is a qualified corporate
lawyer, a Chartered Company Secretary, a member of the
Corporate Governance Institute and a senior Qualified
Executive within the Corporate Broking department of the
Group. The Board also engages external legal advisers to
23
Corporate governance report
7.
Evaluate board
performance
based on clear
and relevant
objectives,
seeking
continuous
improvement
8.
Promote a
corporate
culture that is
based on ethical
values and
behaviours
The board should regularly review the
effectiveness of its performance as a unit, as
well as that of its committees and the
individual directors.
The board performance review may be
carried out internally or, ideally, externally
facilitated from time to time.
The review should identify development or
mentoring needs of individual directors or
the wider senior management team.
It is healthy for membership of the board to
be periodically refreshed. Succession
planning is a vital task for boards. No
member of the board should become
indispensable
The board should embody and promote a
corporate culture that is based on sound
ethical values and behaviours and use it as
an asset and a source of competitive
advantage.
The policy set by the board should be visible
in the actions and decisions of the chief
executive and the rest of the management
team. Corporate values should guide the
objectives and strategy of the company.
The culture should be visible in every aspect
of the business, including recruitment,
nominations, training and engagement. The
performance and reward system should
endorse the desired ethical behaviours
across all levels of the company.
The corporate culture should be
recognisable throughout the disclosures in
the annual report, website and any other
statements issued by the company
advise them, where appropriate and necessary on the
legal aspects of any ongoing regulatory queries.
Evaluation of the performance of the Company’s Board
has historically been implemented in an informal manner,
with the exception of the Executive Directors who are
assessed annually on performance by the Chair.
At this stage a formalised process has not been adopted.
It is intended that the process will be formalised in due
course, and details of the process and its results and
recommendations will be published at a future date.
The Nomination Committee
to give
recommendations to the Directors where there are
vacancies or where it is felt that additional directors
should be appointed. For new appointments the search
for candidates is conducted, and appointments are made,
on merit, against objective criteria and with due regard for
the benefits of diversity on the Board.
required
is
to
corporate
The Company’s website sets out the Company’s approach
to corporate responsibility and the Company’s values
relating
culture.
(https://www.whirelandplc.com/investor-
relations/corporate-governance-code) The Company’s
CSR section of the website sets out the Company’s
approach to corporate responsibility, the Group’s people,
its social impact and the impact upon the environment in
which it operates. Further details can be found in the ESG
section of these financial statements.
The Board seeks to ensure that all of its employees are
aware of the Company’s ethical values which embodies
seven core values. These are covered in the mandatory
induction process for new employees and each employee
is also assessed on their adherence to these values in their
annual appraisal which influences promotion and reward.
24
Corporate governance report
9. Maintain
governance
structures and
processes that
are fit for
purpose and
support good
decision-
making by the
board
The company should maintain governance
structures and processes in line with its
corporate culture and appropriate to its:
• size and complexity; and
• capacity, appetite and tolerance for risk.
The governance structures should evolve
over time in parallel with its objectives,
strategy and business model to reflect the
development of the company.
The Board has established Audit, Remuneration, Risk,
Nomination and Executive Committees which meet
regularly in accordance with their terms of reference. The
details of these committees, including their terms of
reference and composition, are set out in this Corporate
Governance section. This detail also includes the roles
and responsibilities of each of the Directors, with all of the
Non-Executive Directors sitting on each of the sub-
committees of the Board.
The matters reserved for the Board, are set out in the
Board Terms of Reference, and can be summarised as
follows:
-
Reviewing, approving and guiding corporate
strategy, major plans of action, risk appetite and
policies, annual budgets and business plans;
setting performance objectives; monitoring,
implementation and corporate performance;
and overseeing major capital expenditures,
acquisitions and disposals;
- Monitoring the effectiveness of the Company’s
governance
and practices,
arrangements
making changes as needed to ensure the
the Company’s governance
alignment of
framework with current best practices;
Ensuring that appointments to the Board or its
Committees are effected in accordance with the
appropriate governance process;
-
- Monitoring and managing potential conflicts of
interest of management, Board members,
shareholders, external advisors and other service
providers, including related party transactions;
and overseeing the process of disclosure and
communications.
The Board is also responsible for all other
matters of such
importance as to be of
significance to the Group as a whole because of
their
reputational
implications or consequences.
financial or
strategic,
-
At this stage the Board believes that the governance
framework is appropriate for a Company of its size but it
continues to keep this under review.
25
Corporate governance report
10
.
Communicate
how the
company is
governed and is
performing by
maintaining a
dialogue with
shareholders
and other
relevant
stakeholders
A healthy dialogue should exist between the
board and all of its stakeholders, including
shareholders, to enable all interested parties
to come to informed decisions about the
company.
In particular, appropriate communication
and reporting structures should exist
between the board and all constituent parts
of its shareholder base. This will assist:
• the communication of shareholders’ views
to the board; and
• the shareholders’ understanding of the
unique circumstances and constraints faced
by the company.
It should be clear where these
communication practices are described
(annual report or website).
regulators
The Company is committed to open dialogue with all its
liaises with the Company’s
stakeholders. The CEO
principal
and, where
shareholders,
appropriate, clients and relays their views to the wider
Board.
On the Company’s website shareholders can find all
historical regulatory announcements, Interim Reports
and Annual Reports. Annual Reports and Annual General
Meeting Circulars are sent directly to all registered
shareholders or nominees and results of Annual General
Meeting votes are also published on the Company’s
the Company also
website. As described earlier,
maintains email and phone contacts which shareholders
can use to make enquiries or requests.
At the stage the Board does not publish an Audit
Committee Report, but following the appointment of new
Chair of the Audit Committee it will look to adopt such a
report in the coming year.
Following the Company’s AGM the results of all votes will
be made available on the website.
26
Corporate governance report
The Board and its Committees
At the date of this report the Group Board consists of two Executive and three Non-Executive Directors. The Board is responsible for
the overall direction and strategy of the Group and meets regularly throughout the year. Under the Company’s Articles of Association
at every AGM, any Directors:
who have been appointed by the Directors since the last AGM; or
who were not appointed or reappointed at one of the preceding two AGMs,
must retire from office and may offer themselves for reappointment by the members.
The Board has formally established a number of committees and agreed their terms of reference, as follows:
Remuneration Committee
The principal function is to determine the policy on Executive appointments and remuneration. The committee consists of all the
Non-Executive Directors with Simon Lough as Chair. It is the aim of the committee to attract, retain and motivate high calibre
individuals with a competitive remuneration package.
Remuneration for Executives normally comprises basic salary, bonus, benefits in kind and options. Details of the current Directors’
remuneration are given in the Remuneration Report (page 37).
Other Executive Directors and Risk Committee members may be invited to attend the meetings and the committee has access to
advice from the Head of HR.
Audit Committee
The committee is made up of all the Non-Executive Directors with Tom Wood as Chair. It is responsible for reviewing the Company’s
arrangements with its external and internal auditors, including the cost effectiveness of the audit and the independence and
objectivity of the auditors. It also reviews the application and appropriateness of the Company’s accounting policies, including any
changes to financial reporting requirements brought about by both external and internal requirements and it gives consideration
to all major financial announcements made by the Company including its interim and preliminary announcements and annual
report and accounts.
The external auditors, internal auditors and other Executive Directors may be invited to attend the meetings.
Risk Committee
The committee is made up of all the Non-Executive Directors with Helen Sinclair as Chair. It is responsible for advising the Board on
risk appetite, tolerance and strategy, taking into account the current and prospective regulatory and market environment.
The Committee maintains a constant review of both the Group’s overall risk assessment processes and the effectiveness of the
Group’s internal controls and risk management systems. It advises the Board on proposed strategic transactions that may impact
the risk profile of the Group.
The Head of Compliance and Risk and the Executive Directors may be invited to attend the meetings.
Nomination Committee
The committee consists of all the Non-Executive Directors with Simon Lough as chair. It is the aim of the committee to identify and
nominate potential candidates to fill Board vacancies; to consider succession planning and to consider appropriate training for the
Board.
27
Corporate governance report
Executive Committee
The committee is made up of the senior management of the Group and is chaired by the CEO. The committee is responsible for
oversight of all delegated functions by the Board and the day-to-day operational business. In addition, it is responsible for ensuring
the strategy of the Board is implemented and any issues that need to be communicated to the Board are recorded as such. The
committee is also responsible for ensuring timely identification and resolution of regulatory and compliance issues, ensuring senior
management are aware of significant regulatory matters and to act as a forum to update the Chief Risk and Compliance Officer
about organisational change and new business.
Internal control
The Board has overall responsibility for the framework of internal control established by the Group and places critical importance
on maintaining a strong control environment. This framework of internal control is designed to manage rather than eliminate the
risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against material
misstatement or loss.
Detailed internal control procedures exist throughout the Group’s operations and compliance is monitored by management and
through the Group’s Compliance Department, Internal Audit and the Executive Committees of both business divisions.
By order of the Board.
Katy Mitchell
Company Secretary
July 2022
28
Corporate social responsibility
We consider it essential that all employees within businesses are accountable for their actions and have a
Corporate Social Responsibility (CSR) policy that applies throughout the WH Ireland Group. CSR refers to a
company’s sense of responsibility towards the community and environment in which it operates. It is the
process of assessing a company’s impact on society and evaluating their responsibilities. We are committed
to carrying out our operations in a socially responsible manner when dealing with all stakeholders and to
reporting and communicating openly on its response to CSR issues. Our Policy sets out our responsibilities to,
our people, our community and our environment.
1. People
WH Ireland recognises that people are key to our success in delivering on our commitments to our clients. Our recruitment strategy
is therefore pivotal in attracting and retaining high-quality talent to contribute to our long term success as an organisation. The job
market is becoming progressively more competitive and skill sets continue to grow more diverse. The recruitment process supplies
our business a pool of potential candidates from which thoughtful selection is made to fill positions.
Communicating with our People
Keeping our people up-to-date with the latest company developments is of the upmost importance, and we frequently publish, by
email, our internal staff communication ‘WH Informed’, as well as engaging with our staff via:
Regular town hall meetings
Morning investment meetings & capital markets calls
Strategy days & initiatives
Yearly staff pulse surveys
Employee Engagement Survey
We introduced an annual Employee Engagement Survey in 2021. The aim of this is to keep us focussed on delivering on our promises
to clients & shareholders, and keeping our people inspired to do their best work at WH Ireland.
Highlights
We were delighted with the response to our first engagement
survey with some very positive headline figures.
The survey has also provided us with opportunities and ideas to
work more collaboratively across the WM & CM divisions, with
the two divisions aligning more.
The survey highlighted the importance of continued hybrid
working post the pandemic.
The Executive have approved the continuation of hybrid working
and will continue to monitor its effectiveness. This has made a
positive impact to our employee’s work life balance, improved
mental health and employee satisfaction.
92%
Happy at work
88%
Trust senior management
90%
Job satisfaction
73%
Participation
29
Corporate social responsibility
Areas for Improvement
Areas of improvement were clearly articulated from across the organisation and have provided us with the priorities in which we
have focussed our efforts.
We recognised that there was work to be done on our employee proposition, and in response we have enhanced our benefits
package, implementing new benefits such as income protection and the WH Ireland share save scheme.
We have also made enhancements to our performance management processes so that regular communication is encouraged. In
addition, the introduction of a larger training budget means the Human Resources team are able to undertake a training needs
analysis to address any development needs
We believe that the involvement of our people at all levels as a vital ingredient to our success and to making WH Ireland a great place
to work.
Our Culture
To become one of the UK’s leading financial services Groups, we have a set of four core values which we expect all our staff to share
because without our staff, we cannot succeed. These values are at the core of everything we do.
Preparing for the future
By preparing for the future, we support and guide others throughout their development, are
constantly seeking opportunities to acquire new skills, whilst actively managing talent. We endeavour
to create an atmosphere of mutual trust and respect, whilst conveying a clear sense of purpose and
mission by communicating clearly and positively.
Developing our business
We are constantly focussed on developing our business by evaluating problems and seeking new ways
to address them with our staff. We are always challenging the existing ways in which we do things and
look, where practical, to embrace and implement decisions that are made. It is our belief that we must
embrace a culture of placing the needs of our clients and the success of our business before personal
gain.
Acting Responsibly
By acting responsibly we need our staff to work as part of a larger team i.e. the WH Ireland Group and
to cooperate with others and treat colleagues with respect. This value also applies to our dealings with
our clients and third party suppliers where we treat people fairly and ensure processes and good
governance are adhered to at all times.
Spirit of Change
In an ever changing world, we must embrace the spirit of change in order to create an atmosphere
where our staff feel empowered to generate fresh ideas and drive innovation.
Diversity & Inclusion
WH Ireland is committed to the strength of diversity and through our shared core values, this is what makes WH Ireland different.
The policies and practices of WH Ireland aim to promote an environment that is free from all forms of discrimination and we believe
that a diverse and inclusive culture is vital to business success. We are seeking to broaden the talent pool as skill needs change and
competition for key people increases. A crucial part of this is increasing our appeal to groups less well-represented in our workforce.
To this end, the company intends to select the best available person for every vacancy, regardless of sex, race, colour, religion, ethnic
origin, age, disability or sexual orientation.
30
Corporate social responsibility
Employee Wellbeing
WH Ireland is a people business and as our most important asset, we are committed to providing our employees with a working
environment that allows them to perform their jobs to the best of their abilities, and in turn to provide the best outcomes for our
clients. We have a strong commitment to the health and wellbeing of all our employees and actively promote the health and
wellness of our people through education and initiatives that:
Encourage habits of wellness
Increase awareness of factors and resources contributing to well-being
Inspire and empower individuals to take responsibility for their own health
Support a sense of community
We also operate an Employee Assistance program with Care First, who offer advice and access to mental health treatment. Calls are
answered by a trained counsellor, and they also offer up to 8 face to face counselling sessions per issue.
Hybrid Working
We offer all of our staff a hybrid working pattern of 60% time in the office, with 40% optional home time on a weekly basis and we
continue to review and change our ways of working to ensure that both our business and our people thrive in the post-pandemic
world.
Day in the life – Bilal Ibrahimi, Research Analyst
I have always been an avid reader of financial books and kept a keen eye on market
movements, therefore, the opportunity to join WH Ireland as a Research Analyst was extremely
exciting to me. The interview process was quick but very thorough. Our interests were aligned;
I wanted to learn and have an impact and they wanted to teach and develop. A year later, I can
confirm it was the right choice! In Research, the core of my work is doing top-down research to
find opportunities in the market through investing in funds and mitigating risk. The hierarchy
is flat where discussions and debates are encouraged to prevent groupthink. Therefore,
whether it is the Asset Allocation meeting, Investment Committee meeting, or having daily
catch-up calls with my manager (the CIO), I am always pushed to bring my best. It has been a
year of learning and impact, for example, I am currently a CFA Level 1 candidate, and a report I
produced was published in the press. Overall, it has been great, and I am excited for the next
leg of the journey.
31
Corporate social responsibility
Recognition of our People
The firm aims to attract, retain and motivate employees for contributing to our success by providing consistent remuneration
approach based on fixed salary and discretionary bonuses that are aligned to the performance of the business and its employees.
The Company also offers all employees the opportunities to participate in its comprehensive benefits programme. This package
and the providers will vary from time to time but primarily comprises of:
Private Health Insurance
Life Assurance
Income Protection
Cycle to Work scheme
Gym Membership subsidy
Contributory Pension Scheme under the auto-enrolment legislation
Discounts on products and services via the Chartered Institute for Securities & Investments (CISI)
Sharesave scheme
Season ticket loan
2. Community
We are proud to support a number of initiatives across the country. At WH Ireland, we want to forge partnerships with organisations
that share our beliefs and it is important that we play our part in the communities in which we live and work. We also look to support
initiatives internationally that affect issues which are important to us.
Charitable Donations
Ukraine Crisis
With some of our staff having loved ones located in Ukraine, awareness of the need for extra supplies was undeniable, and WH
Ireland came together to ask all staff for donations of any amount which was then increased by additional funds from the company.
Aimee McCusker, Director of Corporate Broking and Martyna Kandrataviciute, Investor Relations Executive, used the funds raised to
purchase essentials such as tinned & baby food, sanitary items and medical supplies in the UK which were taken to the Salvation
Army at Portobello Market who regularly organise trips to Ukraine to deliver these essentials to those who are in great need. We were
informed our supplies would be going to an orphanage in need. Though only a small gesture we wanted to show our support to
those who are suffering.
Cheetah Conservation Fund UK
We were delighted to partner with Cheetah Conservation Fund UK (CCF UK) in 2021. CCF UK’s mission is to raise awareness and
funds to secure a future in the wild for Africa’s most endangered big cat. WH Ireland’s support – via donations and employee
engagement – goes directly towards their vital work in Namibia and other cheetah range countries. Our efforts helped fund projects
that aim to combat the illegal wildlife trade, which is pushing cheetahs towards local extinction in the Horn of Africa.
(more:trees)
We are committed to taking climate action and improving our planet for generations to come, which is why we plant a new tree for
every new investment account opened. These are planted by our tree-planting partner, (more:trees), who operate projects in
Madagascar, Kenya, and Haiti. As well as going on to sequester an estimated 0.3t of CO2 across each tree's growth life, these trees
help support poverty alleviation, life on land and below water, health and wellbeing, and more.
32
Corporate social responsibility
3. Environment
At WH Ireland, we ensure that our core values are at the forefront of every key decision. Sustainability is one of those core values and
contributes to our corporate responsibility to curate a safe, sustainable and inspiring working environment. We believe that we can
harness this to amplify our performance for the betterment of our employees, our shareholders and local stakeholders.
Energy Usage
At all levels of seniority, we frequently evaluate our environmental impact and introduce ways to minimise our carbon footprint. As
part of the professional development of our staff, we have a mandatory module to raise environmental awareness and responsibility
of our staff both in the office and at home. We are also proud to emphasise that all of our offices are gas-free.
In our offices throughout the UK we have implemented the following in order to actively pursue sustainability:
Sensor lights
Easy access to recycling points
In line with the Streamlined Energy and Carbon Reporting legislation, it is our duty as a company to report our Scope 1 and Scope 2
emissions. Scope 1 refers to emissions from activities owned or controlled by a company that directly release emissions such as gas
heating, whereas Scope 2 includes the indirect emissions from the generation of purchased electricity. As a quoted company, it is
not mandatory for WH Ireland to disclose Scope 3 emissions. These include emissions that the company does not have direct control
over but has some influence over, such as supply chain emissions and employee transportation. WH Ireland has chosen not to
disclose this information.
Energy and emissions
Fuel consumption
Scope 1 total
Electricity consumption
Scope 2 total
Gross total
Intensity per 1,000m2 Gross Floor Area
Year to 31-Mar-22
Year to 31-Mar-21
GHG emissions
tCO2e
Energy consumption
kWh
GHG emissions
tCO2e
Energy consumption
kWh
-
-
-
-
-
-
-
-
402,724
402,724
402,724
50
-
-
-
-
-
-
-
-
400,265
400,265
400,265
51
Our sustainability efforts this year have been reflected in the figures above. Year-on-year WH Ireland only experienced a 6.7% rise in
consumption, despite significantly higher attendance in offices due to 2020/21 being affected by COVID-19 lockdowns. This
highlights the efficacy of the measures put in place, as we put more emphasis on sustainability each year. Similarly, the energy
intensity figure outlines these successes. With the expansion of the workforce, an additional office after our Acquisition of Harpsden
Wealth Management in December 2020 and our switch from mostly remote working to a 3 days in office hybrid working model, the
intensity with which we consume energy has risen just 1.6%.
Assumptions
Energy usage is listed in kilowatt-hours and has been taken from manual meter readings listed on supplier invoices where possible.
We were unable to confirm the meter reading for Suite 9 of the Leeds office and the Cardiff office for the financial year ended March
2021 (FY21). With the knowledge of how much energy has been consumed over the two year period, we apportioned one third of
the usage to FY21 and two thirds to the FY22. This apportionment is based on the assumption that we have used double the
electricity this year. Most staff work in the office for three days a week in a hybrid working model, while during 2020-21 we
experienced numerous lockdowns resulting in a remote working model for much of the year. Additionally, the landlord for our
Henley office was unable to provide electricity consumption data, as our electricity costs are built into our lease agreement. This
figure was based on the kilowatt-hour per square foot of our Poole office, which is only 50sq ft less in size (1050 sq ft in total), and
then estimated on a pro-rata basis to reflect the headcount of the Henley office.
33
Corporate social responsibility
Investing Responsibly
We believe Environmental, Social, and Governance (ESG) integration and engagement is paramount in today’s investment industry
and as such we incorporate both qualitative and quantitative measures across all investments utilised within WH Ireland client
mandates.
As a responsible investor WH Ireland recognises its duty to act in the best long-term interests of our clients which clearly includes
the preservation of our planet. Where consistent with our responsibilities to clients we are committed to incorporating
environmental, social and corporate governance (ESG) issues into our investment practice and to the UN’s Six Principles for
Responsible Investment.
We believe that well managed companies are more likely to deliver shareholder value over the longer term. In our view this means
that they will have effective corporate governance in place and we expect boards to have effective structures and controls in place
to ensure that they do not engage in any activities which are unethical, socially irresponsible or illegal.
This would, for instance, include activities which cause significant long term harm to the environment or carrying out business which
results in human rights violations or the exploitation of workers.
It should be noted that in most quoted companies an active ESG policy exists.
Where investments are made by third party fund managers in pooled funds or similar vehicles, our requirement is that wherever
practicable, the funds in question should seek to avoid direct investment in companies that fall within the exclusions in its ESG
policy. We do, however, recognise that where investments are made in index-related securities, it is not practicable to pursue an
investment strategy where an indirect investment in such companies coincidentally arises.
We would not ordinarily preclude investment in companies which operate in the alcohol, tobacco or armaments sectors unless this
is a specific restriction imposed by a client.
United Nations Six Principles for Responsible Investment:
Principle 1: We will incorporate ESG issues into investment analysis and decision-making processes.
Principle 2: We will be active owners and incorporate ESG issues into our ownership policies and practices.
Principle 3: We will seek appropriate disclosure on ESG issues by the entities in which we invest.
Principle 4: We will promote acceptance and implementation of the Principles within the investment industry.
Principle 5: We will work together to enhance our effectiveness in implementing the Principles.
Principle 6: We will each report on our activities and progress towards implementing the Principles.
Implementing the Principles
We invest directly in companies and corporate securities and via collective funds. Our research team and investment managers
conduct research, analysis and due diligence before investing on behalf of clients. Before we invest one of our considerations is
how investee companies and collective fund managers have incorporated ESG into their own businesses and investment processes.
UK Stewardship Code, FRC
The Stewardship Code seeks to promote the long-term success of companies in such a way that the ultimate shareholders also
prosper too. Effective stewardship has many benefits, both for companies and their investors as well as the overall economy.
WH Ireland abides by the principles of the Stewardship Code to safeguard the investment value of our clients.
As a responsible shareholder we take an active interest in the companies in which we invest and if we had any significant concerns
we would initially raise them with the company. In the event that we did not receive a satisfactory response we reserve the right to
vote against the reappointment of management.
We would, in some instances, consider the sale of shares in any offending company as they are unlikely to be a good long term
investment if they are deemed to be trading in a socially irresponsible manner.
34
Remuneration report
The Directors present the Directors’ Remuneration Report (the “Remuneration Report”) for the financial year ended 31 March 2022.
Composition and Role of the Remuneration Committee
As detailed within the Corporate Governance report, the Board has established a Remuneration Committee which currently consists
of all the Non-Executive Directors, chaired by Simon Lough.
The committee determines and agrees with the Board the framework and policy of Executive remuneration and the associated costs
to the Group and is responsible for the implementation of that policy. The committee determines the specific remuneration
packages for each of the Executive Directors and no Director or Senior Executive is involved in any decisions regarding their own
remuneration. The committee has access to information and advice provided by the CEO and the CFO and has access to
independent advice where it considers it appropriate.
This report explains how the Group has applied its policy on remuneration paid to Executive Directors.
Framework and Policy on Executive Directors’ Remuneration
The Group’s remuneration policy is designed to provide competitive rewards for its Executive Directors and other Senior Executives,
taking into account the performance of the Group and the individual Executives, together with comparisons to pay conditions
throughout the markets in which the Group operates. It is the aim of the committee to attract, retain and motivate high calibre
individuals with a competitive remuneration package. It is common practice in the industry for total remuneration to be significantly
influenced by bonuses.
The remuneration packages are constructed to provide a balance between fixed and variable rewards. Therefore remuneration
packages for Executive Directors and Senior Executives normally include basic salary, bonuses, benefits in kind and options. In
agreeing the level of basic salaries and annual bonuses the committee takes into consideration the total remuneration that
Executives could receive.
Basic Salary
Basic salaries are reviewed on an annual basis or following a significant change in responsibilities. The committee seeks to establish
a basic salary for each Executive determined by individual responsibilities and performance, taking into account comparable
salaries for similar positions in companies of a similar size in the same market.
Incentive Arrangements
Bonuses
These are designed to reflect the Group’s performance, taking into account the performance of its peers, the market in which the
Group operates and the Executive’s contribution to that performance.
Performance related contractual incentive scheme
These are designed to reward performance by employees across the Group.
Share options
The Group has five different share ownership plans for employees; CSOP, SAYE, JOE scheme, the 2020 EMI option scheme and an
unapproved share option scheme. In addition, to facilitate some of the option exercises, the Company has an ESOT.
ESOT
The WH Ireland Group plc Employee Share Ownership Trust (ESOT) was established on 19 October 2011, for the purpose of holding
and distributing shares in the Company for the benefit of employees. All costs of the ESOT are borne by Group Companies. 2,839,500
shares (FY21: 2,189,500) are held by Sanne Fiduciary Services Limited as trustee of the ESOT at the date of this report.
CSOP
Under the terms of the Company Share Option plan, options over the Company’s shares may be granted on a discretionary basis to
employees of the Group (including Directors) at a price which is not less than the market value of the shares at the date of grant.
Performance conditions may be imposed at the discretion of the Board.
In the event of an option holder ceasing to be an employee of the Group, options granted under the CSOP shall lapse (a) on the first
anniversary of an option holder’s death, (b) on the expiry of 6 months from the date on which an option holder ceases to be an
employee of the Group due to injury, disability, retirement or redundancy or (c) immediately on an option holder ceasing to be an
employee of the Group for any reason other than those referred to in (a) and (b), unless, and to the extent, the Board exercises its
discretion to allow the options to be exercised for a period after the option holder ceases to be an employee of the Group.
35
Remuneration report
SAYE
Under the terms of the Save As You Earn scheme, employees of the Group (including Directors) may be invited to apply for an option
to be granted to them at a price of 90% of the market value of the shares at the date of grant. Employees enter into a savings contract
under which they agree to save a certain amount of salary each month for a specified period, typically 3 years, with a view to using
those savings to buy shares under the terms of the option.
In the event of an employee leaving before the end of the 3 years contract because of redundancy, injury, disability or retirement,
the employee will be able to continue saving privately and buy a reduced number of shares (in line with the amount saved) within 6
months of leaving using the savings accrued. If the employee leaves before the end of the 3 years due to resignation, dismissal on
grounds of misconduct or not returning after maternity leave, they would not be able to buy any shares and would have their funds
returned to them. In the event of death prior to the scheme maturing, the deceased’s personal representative(s) would be able to
buy a reduced number of shares within 12 months of the death. A SAYE scheme was introduced in the financial year and is due to
run for 3 years
Unapproved Share Option Scheme
Under the terms of the unapproved share option scheme, options over the Company’s shares may be granted on a discretionary
basis to employees and consultants of the Group (including Directors) at a price to be agreed between the Company and the relevant
option holder. Under the terms of the options granted, such options vest on the third anniversary of the award dates; are exercisable
at the market price at the time the option was issued and are exercisable for ten years after the vesting date.
JOE Scheme
Under the terms of the Joint Share Option Plan, each option holder holds shares jointly with the ESOT. These shares vest subject to
the satisfaction of certain performance criteria agreed between the Company, the ESOT, and the option holder.
2020 EMI Option scheme
During 2020 an Enterprise Management Incentive (EMI) share option scheme was designed and registered with HMRC as an
approved EMI scheme. EMI options are a tax efficient way of granting options to employees. The value of options granted is by
reference to the current market value (CMV) of the Company’s share price at the date of grant and the maximum aggregate value of
granted but un-exercised options outstanding at any one time is £3.0m with an individual maximum allowance at any one time to
an employee of £250,000.
Other Employee Benefits
Depending on the terms of their contract certain Executive Directors and Senior Executives are entitled to a range of benefits,
including contributions to individual personal pension plans, private medical insurance and life assurance.
Service Contracts and Notice Periods
The Executive Directors are employed on rolling contracts subject to six months’ notice from either the Executive or the Group, given
at any time. Under certain change in control circumstances the notice period can be subject to extension to twelve months. The
service contracts of the current Executive Directors are available for inspection by any person from the Human Resources
department at the Group’s administrative office during normal office hours on any day except weekends and bank holidays and at
the AGM from 9am on the day of the Meeting until the conclusion of the Meeting.
Contracts of employment for Senior Executives are all on a rolling basis subject to notice periods ranging from three to twelve
months with certain additional provisions triggered in the event of changes in control of the Company.
Service contracts do not provide explicitly for termination payments or damages but the Group may make payments in lieu of notice.
For this purpose pay in lieu of notice would consist of basic salary and other relevant emoluments for the relevant notice period
excluding any bonus.
External Appointments undertaken by Executive Directors
In the committee’s opinion, experience of other companies’ practices and challenges is valuable for the personal development of
the Group’s Executive Directors and for the Company. It is therefore the Group’s policy to allow Executive Directors to accept Non-
Executive Directorships at other companies, provided the time commitment does not interfere with the Executive Directors’
responsibilities within the Group. Fees are retained by the individual Executive Director.
Non-Executive Directors
All Non-Executive Directors have a letter of appointment for an initial period of twelve months and thereafter on a rolling basis
subject to three months’ notice by either the Non-Executive Director or the Group, given at any time.
36
Remuneration report
In the event of termination of their appointment they are not entitled to any compensation. The terms and conditions of
appointment of Non-Executive Directors are available for inspection by any person from the Human Resources department at the
Group’s administrative office during normal working hours on any day except weekends or bank holidays and at the AGM from 9am
on the day of the Meeting until the conclusion of the Meeting.
Non-Executive Directors’ fees are determined by the Executive Directors having regard to the need to attract high calibre individuals
with the right experience, the time and responsibilities entailed and comparative fees paid in the market in which the Group
operates. They are not eligible for pensions.
Directors’ Emoluments
The remuneration of each Director as listed on page 91, Company Information, excluding share options and awards, during the year
ended 31 March 2022 is set out in the table below:
Salary Benefits
Bonus
Compensation
for loss of
office
Total
year
ended 31
Mar 2022
Total year
ended 31 Mar
2021
Pension
contribution
year ended
31 Mar 2022
Pension
contribution
year ended
31 Mar 2021
333,333
28,750
150,000
191,667
9,991 125,000
-
1,438
50,000
2,405
12,109 100,000
-
-
230,000
85,000
468,324
30,188
432,405
388,776
354,831
-
202,176
261,316
33,333
-
7,500
-
26,667
-
10,000
-
Executive
P Wale
S Jackson1
P Tansey2
S Ford3
Non-Executive
S Lough
H Sinclair4
T Wood5
PJ Shelley
A Buchanan6
V Raffé7
T Steel8
47,500
39,449
25,201
100,000
19,792
17,661
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
47,500
39,449
25,201
100,000
19,792
17,661
-
35,833
-
-
65,833
43,750
35,833
10,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
Notes:
953,353
25,943 275,000
315,000 1,569,296
1,009,572
40,833
36,667
1 Appointed 14 February 2022
2 Resigned 31 December 2021
3 Resigned 31 January 2022
4 Appointed 4 May 2021
5 Appointed 20 September 2021
6 Resigned 30 September 2021
7 Resigned 12 August 2021
8 Resigned 19 May 2020
37
Remuneration report
Further to the announcement of 11 March 2021, the Non-Executive Directors received ordinary shares in the Company in lieu of 25%
of the fees that would otherwise be due to be paid to them by the Company.
The highest paid Director for 2022 was P Wale receiving emoluments of £468,325 (FY21: P Wale £354,831).
Directors’ Interests in Share Options
Director
P Wale
Unapproved Options
EMI 2020 Options
500,000
350,000
Total at 31 March
2022
850,000
Total at 31 March
2021
850,000
At 31 March 2022 the market price of the Company’s shares was 45.0p.
The highest daily closing price during the year was 58.5p (51.0p) and the lowest daily closing price was 45.0p (35.0p).
38
Statement of Directors’ responsibilities
In respect of the Directors’ report and the financial statements
The directors are responsible for preparing the Strategic Report, the Directors’ Report and the financial statements in accordance
with applicable law and regulations.
Company law requires the directors to prepare group and company financial statements for each financial year. The directors have
elected under company law and are required by the AIM Rules of the London Stock Exchange to prepare the group financial
statements in accordance with UK-adopted International Accounting Standards and have elected under company law to prepare
the company financial statements in accordance with UK-adopted International Accounting Standards and applicable law.
The group and company financial statements are required by law and UK-adopted International Accounting Standards to present
fairly the financial position of the group and the company and the financial performance of the group and the company. The
Companies Act 2006 provides in relation to such financial statements that references in the relevant part of that Act to financial
statements giving a true and fair view are references to their achieving a fair presentation.
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 group and the company and of the profit or loss of the group for that period.
In preparing each of the group and company financial statements, the directors are required to:
a.
select suitable accounting policies and then apply them consistently;
b. make judgements and accounting estimates that are reasonable and prudent;
c.
state whether they have been prepared in accordance with UK-adopted International Accounting Standards;
d. prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and the
company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and the
company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and the company and
enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006. They are also
responsible for safeguarding the assets of the group and 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.
39
Independent Auditor’s report to the members of WH Ireland Group plc
Opinion
We have audited the financial statements of WH Ireland plc (the ‘parent company’) and its subsidiaries (the ‘group’) for the year
ended 31 December 2022 which comprise the Consolidated statement of comprehensive income, the Consolidated and Company
statement of financial position, the consolidated and Company statement of cash flows, the Consolidated and Company changes
in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and UK-adopted International Accounting Standards and, as regards the parent
company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31
March 2022 and of the group’s profit for the year then ended;
the group financial statements have been properly prepared in accordance with UK-adopted International Accounting
Standards;
the parent company financial statements have been properly prepared in accordance with UK-adopted International
Accounting Standards and as applied in accordance with the Companies Act 2006; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
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 parent company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities1 and we
have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Summary of our audit approach
Key audit matters
Group
Goodwill and intangible assets impairment
Materiality
Group
Overall materiality: £158,000 (2021: £427,000)
Performance materiality: £118,000 (2021: £298,000).
Parent Company
Overall materiality: £157,500 (2021: £218,000)
Performance materiality: £118,000 (2021 : £152,000)
Scope
Our audit procedures covered 100% of revenue, 100% of total assets and 100% of profit
before tax.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the group financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect on the overall audit strategy, the allocation of resources in the
audit and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the group
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined that there are no key audit matters in relation to the parent company financial statements to communicate in
our report.
40
Independent Auditor’s report to the members of WH Ireland Group plc
Valuation of Goodwill and Intangible Fixed Assets
Key audit matter description
The Directors have set out in the Accounting Policies on page 57 and 58 the policy
adopted in relation to the recognition of goodwill and intangible assets and the policy
in relation to impairment of such assets. The key judgements in relation to these
policies are set out on page 60. These assets relate to acquisitions in prior accounting
period.
How the matter was
addressed in the audit
Goodwill of £3,539,000 and Intangible Assets of £4,259,000 as set out in notes 15 and
16 are included in the consolidated Statement of Financial Position. Management is
required by IAS 36 “Impairment of assets” to perform an annual impairment review
for cash generating units to which goodwill has been allocated. The test for
impairment compares the carrying value of the cash generating units to which the
goodwill and other intangible assets are allocated to their recoverable amount –
being the higher of their fair value less any costs to resell or their value in use. The
calculation of value in use requires management judgement. The “headroom” in the
impairment assessment is sensitive to changes in the assumptions used (as set out in
note 15) and as such we consider this a key audit matter.
Our work in relation to this matter included:-
Consideration of management’s assessment of the allocation of goodwill and
intangible assets to a cash generating unit.
Testing the value in use calculations for mathematical accuracy and consistency with
the requirements of IAS 36.
Assessing the period of time for which management has prepared forecasts, and the
long term growth rates used.
Challenge of management on the Key assumptions used in their forecast models,
including revenue, and material fixed and variable cash outflows.
Work with our internal valuation specialists to determine the appropriateness of the
value in use calculation and the accuracy and appropriateness of discount rates used.
Evaluation of the sensitivity analysis prepared by management.
Consideration of the qualifications, credentials and independence of experts used by
management to assist them in preparing their assessment.
Assessing the completeness and accuracy of disclosures in the financial statements.
Our application of materiality
When establishing our overall audit strategy, we set certain thresholds which help us to determine the nature, timing and extent of
our audit procedures. When evaluating whether the effects of misstatements, both individually and on the financial statements as
a whole, could reasonably influence the economic decisions of the users we take into account the qualitative nature and the size of
the misstatements. Based on our professional judgement, we determined materiality as follows:
Overall materiality
£158,000 (2021 : £427,000)
£157,500 (2021 : £218,000)
Group
Parent company
Basis for determining overall
materiality
5% of EBITDA (2021 : 1.5% of group revenue) 1% of Net Assets – capped for the purposes
financial
the group
: 51% of group
the audit of
(2021
of
statements
materiality)
Rationale for benchmark applied
Underlying earnings are considered to be a
key benchmark monitored by management
and investors.
The value of net assets are considered to be
by
key
a
management.
benchmark monitored
Performance materiality
£118,000 (2021 : £298,000)
£118,000 (2021: £152,000)
41
Independent Auditor’s report to the members of WH Ireland Group plc
Basis for determining
performance materiality
Reporting of misstatements to
the Audit Committee
75% (2021 : 70%) of overall materiality
75% (2021 : 70%) of overall materiality
in excess of £7,900 and
Misstatements
misstatements below that threshold that, in
our view, warranted reporting on qualitative
grounds.
Misstatements in excess of £7,870 and
misstatements below that threshold that, in
our
reporting on
qualitative grounds.
view, warranted
An overview of the scope of our audit
The group consists of 11 components, all of which are based in the UK. 8 components are dormant companies and do not contribute
to group trading results or assets.
The coverage achieved by our audit procedures was:
Full scope audit
Total
Number of
components
3
3
Revenue
Total assets
Profit before tax
100%
100%
100%
100%
100%
100%
No audit work was undertaken by component auditors.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s and parent
company’s ability to continue to adopt the going concern basis of accounting included a review of financial forecasts for a period of
at least 12 months from approval of the financial statements including an evaluation of downside scenarios and stress testing for
the assessment period.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the group’s or the parent company’s ability to continue as a going concern
for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of
this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our
auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on
the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we
do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives
rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that
there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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.
42
Independent Auditor’s report to the members of WH Ireland Group plc
Matters on which we are required to report by exception
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 material misstatements in the Strategic Report or the Directors’ Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
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; or
certain disclosures of directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 39, 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.
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.
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.
The extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient
appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of
material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-
compliance with other laws and regulations that may have a material effect on the financial statements, and to respond
appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements
due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud
through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified
during the audit.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the
entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection
of fraud.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the group audit engagement
team:
obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the
group and parent company operate in and how the group and parent company are complying with the legal and regulatory
framework;
inquired of management, and those charged with governance, about their own identification and assessment of the risks
of irregularities, including any known actual, suspected or alleged instances of fraud;
discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of
how and where the financial statements may be susceptible to fraud having obtained an understanding of the effectiveness
of the control environment.
The most significant laws and regulations were determined as follows:
43
Independent Auditor’s report to the members of WH Ireland Group plc
LEGISLATION/REGULATION
ADDITIONAL AUDIT PROCEDURES PERFORMED BY THE GROUP AUDIT ENGAGEMENT TEAM INCLUDED:
UK-adopted IAS and
Companies Act 2006
FCA regulations
Review of the financial statement disclosures and testing to supporting documentation;
Completion of disclosure checklists to identify areas of non-compliance
Review of controls in place to ensure ongoing compliance with FCA regulator requirements
including reporting to the Board. In addition we completed work to review compliance with FCA
laws and regulations.
The areas that we identified as being susceptible to material misstatement due to fraud were:
RISK
Management
override of controls
Revenue Recognition
AUDIT PROCEDURES PERFORMED BY THE AUDIT ENGAGEMENT TEAM:
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.
Tests of detail over the different revenue streams.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
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.
Malcolm Pirouet (Senior Statutory Auditor)
For and on behalf of RSM UK Audit LLP, Statutory Auditor
Chartered Accountants
RSM UK Audit LLP
25 Farringdon Street
London
EC4A 4AB
26 July 2022
44
Consolidated statement of comprehensive income
Continuing operations
Revenue
Administrative expenses
Expected credit loss
Operating profit/ (loss)
Net gains on investments
Finance income
Finance expense
Profit before tax
Taxation
Profit from continuing operations
Loss from discontinued operations
Profit and total comprehensive income for the year
Note
5
6
18, 23
8
8
9
10
Year ended
31 March 2022
£'000
Year ended
31 March 2021*
£'000
32,035
(33,062)
(81)
(1,108)
1,626
1
(511)
8
67
75
-
75
28,741
(28,390)
(28)
323
818
2
(96)
1,047
192
1,239
(86)
1,153
12
Earnings per share
From continuing operations
Basic
Diluted
From discontinued operations
Basic
Total
2.30p
Basic
2.26p
Diluted
* The comparative revenue, net gains on investments and earnings per share have been restated. Further details can be found in note 3 of these financial
statements
0.13p
0.12p
0.13p
0.12p
2.47p
2.43p
(0.17p)
-
Notes on pages 52 to 90 are an integral part of these financial statements.
There were no items of other comprehensive income for the current year or prior years.
45
Consolidated and Company statement of financial position
Group
31 March
2022
£'000
Company
31 March
2021
£'000
31 March
2022
£'000
31 March
2021
£'000
Note
ASSETS
Non-current assets
Intangible assets
Goodwill
Investment in subsidiaries
Property, plant and equipment
Investments
Right of use asset
Deferred tax asset
Loan receivable
Current assets
Trade and other receivables
Other investments
Cash and cash equivalents
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Lease liability
Deferred consideration
Deferred tax liability
Non-current liabilities
Lease liability
Deferred consideration
Total liabilities
Total net assets
Capital and reserves
Share capital
Share premium
Other reserves
Retained earnings
Treasury shares
Shareholders’ funds
16
15
17
13
18
19
21
20
22
23
24
25
19
26
21
19
26
29
29
30
4,259
3,539
-
325
3,013
1,168
190
-
12,494
5,758
1,912
6,446
14,116
26,610
(6,681)
(376)
(2,412)
(732)
(10,201)
(999)
-
(999)
(11,200)
15,410
3,104
19,014
981
(6,789)
(900)
15,410
4,764
3,539
-
511
1,099
1,603
190
-
11,706
5,156
2,490
8,211
15,857
27,563
(7,623)
(552)
(1,087)
(799)
(10,061)
(1,506)
(909)
(2,415)
(12,476)
15,087
3,101
18,983
981
(7,334)
(644)
15,087
-
-
26,448
4
-
-
-
900
27,352
113
-
1,246
1,359
28,711
(2,357)
-
(2,412)
-
(4,769)
-
-
-
(4,769)
23,942
3,104
19,014
228
1,596
-
23,942
-
-
26,448
-
-
-
-
644
27,092
56
-
1,246
1,302
28,394
(2,960)
-
(1,087)
-
(4,047)
-
(909)
(909)
(4,956)
23,438
3,101
18,983
228
1,126
-
23,438
46
Consolidated and Company statement of financial position
The notes on pages 52 to 90 are an integral part of these financial statements.
The Company has elected to take the exemption under Section 408 of the Companies Act 2006 not to present the Company
statement of comprehensive income. The loss after tax of the Company for the year was £Nil (FY21: £5,347k).
These financial statements were approved by the Board of Directors on 26 July 2022 and were signed on its behalf by:
S Jackson
Director
47
Consolidated and Company statement of cash flows
Group
Company
Year ended
Year ended
31 Mar 2022 31 Mar 2021* 31 Mar 2022 31 Mar 2021
Year ended
Year ended
Notes
£'000
£'000
£'000
£'000
75
-
75
13, 16, 19
1,229
Operating activities:
Profit/ (Loss) for the year:
Continuing operations
Discontinuing operations
Adjustments for non-cash items:
Depreciation and amortisation
Finance income
Finance expense
Tax
Non-cash adjustment for share option charge
Non-cash adjustment for investment gains
Non-cash consideration for revenue*
Losses in investments
Working capital changes:
Decrease/ (increase) in trade and other receivables
(Decrease)/ increase in trade and other payables
Net cash (used in)/generated from operations
Income taxes received/(paid)
Net cash inflows/ (outflows) from operating activities
Investing activities:
Cost on disposal of subsidiary undertaking
Interest received
Investment in subsidiary
Acquisition of property, plant and equipment
Increase in loan receivables
8
8
9
7
18, 23
18, 23
9
8
17
13
Movement in current asset investments
18, 23
Net cash used in investing activities
Finance activities:
Proceeds from issue of share capital
Proceeds from repayment of subordinated loan
Purchase of own shares by Employee Benefit Trust
Interest paid
Lease liability payments
8
Net cash (used in)/generated from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
1,239
(86)
1,153
1,242
(2)
96
(196)
90
(48)
(3,988)
-
1,975
2,602
2,924
-
2,924
(90)
3
(4,765)
(201)
-
2,170
(2,883)
-
-
-
-
-
416
-
470
-
-
-
(57)
(603)
226
-
226
-
-
-
(4)
(256)
-
(260)
5,335
34
-
-
(1)
(898)
4,436
4,477
3,734
8,211
-
-
-
-
34
-
1,246
1,246
(1)
511
(67)
470
(1,626)
(1,651)
-
(601)
(942)
(2,603)
-
(2,603)
-
-
-
(103)
-
1,933
1,830
34
-
(256)
(2)
(768)
(992)
(1,765)
8,211
6,446
* The comparative group cash flow figures have been restated. Further details can be found in note 3 of these financial statements.
(5,347)
-
(5,347)
-
-
-
-
90
-
-
283
2,533
2,804
363
363
-
-
(5,437)
-
-
-
(5,437)
5,335
985
-
-
-
6,320
1,246
-
1,246
48
Consolidated and Company statement of cash flows
Reconciliation of Group cash and cash equivalents at the end of the year:
Group
Cash and cash equivalents from continuing operations
Cash and cash equivalents from discontinuing operations
Cash and cash equivalents at end of year
Group
Cash and cash equivalents from continuing operations
Cash and cash equivalents from discontinuing operations
Cash and cash equivalents at end of year
Year ended
31 Mar 2022
£'000
6,446
-
6,446
Year ended
31 Mar 2021
£'000
8,211
-
8,211
Reconciliation of Group and Company liabilities arising from financing activities in the year:
Group
Lease liability
As at
1 April 2021
£'000
2,058
2,058
Cash flows
£'000
(768)
(768)
Non-cash
changes
£'000
85
85
As at
31 March 2022
£'000
1,375
1,375
Reconciliation of Group and Company liabilities arising from financing activities in the prior year:
Group
Lease liability
As at
1 April 2020
£'000
3,223
3,223
Correction of
calculation
£'000
(369)
(369)
Cash flows
£'000
(898)
(898)
Non-cash
changes
£'000
102
102
As at
31 March 2021
£'000
2,058
2,058
There are no Company liabilities arising from financing activities.
The notes on pages 52 to 90 are an integral part of these financial statements.
49
Consolidated and Company changes in equity
Group
Balance at 1 April 2020
Profit and total comprehensive income for the
year
Transactions with owners in their capacity as owners:
Employee share option scheme
New share capital issued
Other movements
Balance at 31 March 2021
Share
capital
£'000
2,435
Share
premium
£'000
14,314
Other Retained
earnings
£'000
(8,580)
reserves
£'000
981
Treasury
shares
£'000
(644)
-
-
-
1,153
-
-
666
-
3,101
-
4,669
-
18,983
-
-
-
981
90
-
3
(7,334)
Profit and total comprehensive income for the
year
Transactions with owners in their capacity as owners:
Employee share option scheme
New share capital issued
Purchase of own shares by Employee Benefit
Trust
Balance at 31 March 2022
-
-
3
-
-
-
31
-
-
-
-
-
75
470
-
-
3,104
19,014
981
(6,789)
The notes on pages 52 to 90 are an integral part of these financial statements.
Retained earnings include £10k (2021: £10k) ESOT reserve.
-
-
-
(644)
-
-
-
(256)
(900)
Total
equity
£'000
8,506
1,153
90
5,335
3
15,087
75
470
34
(256)
15,410
50
Consolidated and Company changes in equity
Company
Balance at 1 April 2020
Loss and total comprehensive income for the
year
Transactions with owners in their capacity as owners:
Employee share option scheme
New share capital issued
Other movements
Balance at 31 March 2021
Share
capital
£'000
2,435
-
-
666
-
3,101
Share
premium
£'000
14,314
Other Retained
earnings
£'000
6,385
reserves
£'000
228
Treasury
shares
£'000
-
-
(5,347)
-
4,669
-
18,983
-
-
-
228
90
-
(2)
1,126
Profit/(loss) after tax
Transactions with owners in their capacity as owners:
Employee share option scheme
New share capital issued
Balance at 31 March 2022
-
-
-
-
-
3
3,104
-
31
19,014
-
-
228
470
-
1,596
The notes on pages 52 to 90 are an integral part of these financial statements.
The nature and purpose of each reserve, whether consolidated or Company only, is summarised below:
Total
equity
£'000
23,362
(5,347)
90
5,335
(2)
23,438
-
470
34
23,942
-
-
-
-
-
-
-
-
Share premium
The share premium is the amount raised on the issue of shares that is in excess of the nominal value of those shares and is recorded
less any direct costs of issue.
Other reserves
Other reserves comprise a (consolidated) merger reserve of £753k (FY21: £753k) and a (consolidated and company) capital
redemption reserve of £228k (FY21: £228k).
Retained earnings
Retained earnings reflect accumulated income, expenses, gains and losses, recognised in the statement of comprehensive income
and the statement of recognised income and expense and is net of dividends paid to shareholders. It includes £10k (FY21: £10k) of
ESOT reserve.
Treasury shares
Purchases of the Company’s own shares in the market are presented as a deduction from equity, at the amount paid, including
transaction costs. That is, shares are shown as a separate class of shareholders’ equity with a debit balance. This includes shares in
the company held by the EBT or ESOT, both of which are consolidated within the consolidated figures.
51
Notes to the financial statements
1. General information
WH Ireland Group plc is a public company incorporated in the United Kingdom. The shares of the Company are traded on the AIM,
a market of the London Stock Exchange Group plc. The address of its registered office is 24 Martin Lane, London, EC4R 0DR.
Basis of preparation
The consolidated and parent company financial statements have been prepared in accordance with International Accounting
Standards as adopted by the UK and in accordance with the Companies Act 2006. The principal accounting policies adopted in the
preparation of the consolidated financial statements are set out in note 3. The policies have been consistently applied to all the
years presented, unless otherwise stated.
The consolidated financial statements are presented in British Pounds (GBP), which is also the Group’s functional currency. Amounts
are rounded to the nearest thousand, unless otherwise stated.
Going concern
The financial statements of the Group have been prepared on a going concern basis. In making this assessment, the Directors have
prepared detailed financial forecasts for the period to September 2023 which consider the funding and capital position of the Group.
Those forecasts make assumptions in respect of future trading conditions, notably the economic environment and its impact on the
Group’s revenues and costs. In addition to this, the nature of the Group’s business is such that there can be considerable variation
in the timing of cash inflows. The forecasts take into account foreseeable downside risks, based on the information that is available
to the Directors at the time of the approval of these financial statements.
The Directors have conducted full and thorough assessments of the Group’s business and the past financial year has provided a
thorough test of those assessments and the resilience of the business. The significant market turbulence particularly in H2 resulting
from the Russian invasion of Ukraine presented a range of challenges to the business. The business reacted well and with increasing
levels of recurring revenue supplementing a buoyant performance by CM delivering a profit for the twelve months.
Whilst there always remains uncertainty over what the future impact will be on the economy, the business has improved its
resilience. By executing its first acquisition WM has increased the total value of assets under management, and importantly the
proportion of that total represented by discretionary managed assets. CM has been appointed by several new clients and completed
a record number of IPOs.
Certain activities of the Group are regulated by the Financial Conduct Authority, the statutory regulator for financial services business
in the UK which has responsibility for policy, monitoring and discipline for the financial services industry. The FCA requires the
Group’s capital resources to be adequate; that is sufficient in terms of quantity, quality and availability, in relation to its regulated
activities. The Directors monitor the Group’s regulatory capital resources on a daily basis and they have developed appropriate
scenario tests and corrective management plans which they are prepared to implement to address any potential deficit as required.
Further actions open to the Directors include incremental cost reductions, regulatory capital optimisation programmes or further
capital raising.
An analysis of the potential downside impacts was conducted as part of the going concern assessment to assess the potential
impact on revenue and asset values with a particular focus on the variable component parts of our overall revenue, such as
corporate finance fees and commission. Furthermore, reverse stress tests were modelled to assess what level the Group’s business
would need to be driven down to before resulting in a liquidity crisis or a breach of regulatory capital. That modelling concluded
that transactional, non-contractual revenue would need to decline by more than 70% from management’s forecasts to create such
a crisis situation within eighteen months’ time.
Based on all the aforementioned, the Directors believe that regulatory capital requirements will continue to be met and that the
Group has sufficient liquidity to meet its liabilities for the next twelve months and that the preparation of the financial statements
on a going concern basis remains appropriate.
52
Notes to the financial statements
2. Adoption of new and revised standards
New and amended standards that are effective for the current year
A number of new or amended standards became applicable for the current reporting period and as a result the group and company
has applied the following standards:
- Amendments to IFRS 16: COVID-19 related rent concessions (effective for periods commencing on or after 1 June 2020
- Amendments to IFRS 9, IAS 39, IFRS 7 and IFRS 16: Interest Rate Benchmark Reform, phase 2.
The above requirements did not have a material impact on the financial statements of the group or company.
New standards, interpretations and amendments not yet effective
Name
IAS 16 (amendments)
Description
Property, Plant and Equipment – Proceeds before Intended
Use
Effective date
1 January 2022
Annual Improvements 2018-2020 Cycle
Amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 4)
1 January 2022
IFRS 3 (amendments)
Reference to the Conceptual Framework
1 January 2022
IAS 37 (amendments)
Onerous Contracts – Cost of Fulfilling a Contract
1 January 2022
IAS 1 (amendments)
Presentation of Financial Statements: Classification of
Liabilities as Current or Non-Current and Classification of
Liabilities as Current or Non-Current – Deferral of Effect
Date
1 January 2023
The Directors do not expect the adoption of these standards and amendments to have a material impact on the Financial
Statements.
3. Significant accounting policies
Basis of consolidation
Where the company has control over an investee, it is classified as a subsidiary. The company controls an investee if all three of the
following elements are present: power over the investee, exposure to variable returns from the investee and the ability of the investor
to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that there may be
a change in any of these elements of control.
The consolidated financial statements present the results of the company and its subsidiaries (“the Group”) as if they formed a single
entity. Intercompany transactions and balances between group companies are therefore eliminated in full. The consolidated
financial statements incorporate the results of business combinations using the acquisition method. In the statement of financial
position, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the
acquisition date. The results of acquired operations are included in the consolidated statement of comprehensive income from the
date on which control is obtained until the date on which control ceased.
In the Company’s accounts, investments in subsidiary undertakings are stated at cost less any provision for impairment.
Business combinations
All business combinations are accounted for by applying the purchase method. The purchase method involves recognition, at fair
value, of all identifiable assets and liabilities, including contingent liabilities, of the subsidiary at the acquisition date, regardless of
whether or not they were recorded in the financial statements of the subsidiary prior to acquisition. The cost of business
combinations is measured based on the fair value of the equity or debt instruments issued and cash or other consideration paid,
plus any directly attributable costs. Any directly attributable costs relating to business combinations before or after the acquisition
date are charged to the statement of comprehensive income in the period in which they are incurred.
Goodwill arising on a business combination represents the excess of cost over the fair value of the Group’s share of the identifiable
net assets acquired and is stated at cost less any accumulated impairment losses. The cash generating units to which goodwill is
allocated are tested annually for impairment. Any impairment is recognised immediately in administrative expenses in the
statement of comprehensive income and is not subsequently reversed. On disposal of a subsidiary the attributable amount of
goodwill that has not been subject to impairment is included in the determination of the profit or loss on disposal.
53
Notes to the financial statements
3. Significant accounting policies (continued)
Discontinued operations
The Group presents its results from its discontinued operations separately from its continuing operations. In line with IFRS 5, an
operation is classed as discontinued if it has been or in the process of being disposed, represents either a separate major line of
business or a geographical area of operations or is part of a single co-ordinated plan to dispose of a separate major line of business
or geographical area of operation.
Prior period restatements
The income statement and cash flow statement for the year ended 31 March 2021 has been restated to reflect the following errors
which have been identified by management and corrected during the current financial year:
Net fair value gains of £818,000 arising on movements in non-cash consideration after initial recognition and sales of
investments were incorrectly recorded within Revenue rather than within Net gains on investments.
Movements in current asset investments have been represented in the cash flow statements as investing activities in
accordance with IAS 7. Movements in current asset investments have been restated to exclude non-cash movements
identified which were incorrectly included in calculating the cash flow.
The calculation of dilutive earnings per share used an incorrect dilutive share figure.
There was no impact upon the profit and total comprehensive income and net increase in cash and cash equivalents as reported at
31 March 2021 and the net assets as reported at 1 April 2020.
31 March 2021
Statement of Comprehensive Income
Revenue
Net gains on investments
Consolidated and Company statement of cash flows
Operating activities (extract)
Non-cash consideration for revenue
Non-cash adjustment for investment gains
Trade and other receivables
Movement in current asset investments
Net cash (used in)/ generated from operations
Investing activities (extract)
Movement in current asset investments
Earnings per share
Effect of dilutive share options (£'000)
Diluted From continuing operations
Total diluted
As originally
reported
£'000
Effect of
restatement
£'000
Group restated
amounts
£'000
29,559
-
(818)
818
28,741
818
-
-
(3,988)
(48)
(3,988)
(48)
1,815
(1,706)
5,094
160
1,706
(2,170)
1,975
-
2,924
-
2,170
2,170
9,614
2.07p
1.93p
(8,931)
0.36p
0.33p
683
2.43p
2.26p
A restated comparative balance sheet has not been produced as there was no change to the statement of financial position
following the restatements. The net effect of these restatements on the statement of cash flows was nil.
54
Notes to the financial statements
3. Significant accounting policies (continued)
Assets and liabilities held for sale
An asset or liability is classified as held for sale if its carrying value is intended to be recovered through its sale rather than its
continuing use, management is committed to a plan to sell, the asset is available for immediate sale, an active programme to locate
a buyer has been initiated, the sale is highly probable within 12 months of classification as held for sale and the actions required to
complete the transaction indicate it is unlikely it will be significantly changed or withdrawn. Assets held for sale are measured at the
lower of their carrying amount and fair value less costs to sell. Any impairment losses is recognised through the consolidated
comprehensive income.
Revenue
WEALTH MANAGEMENT (WM)
Management and custody fees
Investment management fees are recognised in the period in which the related service is provided. It is a variable fee based on the
average daily market value of assets under management and is invoiced on a calendar quarter basis in arrears. The performance
obligation is satisfied over time as the contractual obligations are on ongoing throughout the period under contract. The revenue
accrued but not yet invoiced is recognised as a contract asset.
Initial and ongoing advisory fees
Initial advisory fees are charged to clients on a fixed one-off fee agreement. The performance obligation is satisfied as the initial
advice is provided. Ongoing advisory fees are variable fees based on the average daily market value of assets under management
and invoiced on a calendar quarter basis in arrears. Both initial and ongoing advisory fees are recognised in the period in which the
related service is provided. The performance obligation of ongoing advice is satisfied over time as the contractual obligations are
ongoing throughout the period under contract. The revenue accrued but not yet invoiced is recognised as a contract asset.
Commission and transaction charges
Commission is recognised when receivable in accordance with the date of settlement. It is a variable fee based on a percentage of
the transaction and therefore the performance obligation is satisfied at the date of the underlying transaction. The transaction price
is calculated based on the agreed percentage of the underlying consideration of the trade. The underlying consideration being the
number of shares multiplied by the share price at the time of the underlying transaction.
CAPITAL MARKETS (CM)
Commission
Brokerage commission is recognised when receivable in accordance with the date of settlement. It is a variable fee based on a
percentage of the transaction and therefore performance obligation is satisfied at the date of the underlying transaction. The
transaction price is calculated based on the agreed percentage of the underlying consideration of the trade. The underlying
consideration being the number of shares multiplied by the share price at the time of the underlying transaction.
Corporate finance advisory fees
Corporate finance advisory fees are fixed fees agreed on a deal by deal basis and might include non-cash consideration received in
the form of shares, loan notes, warrants or other financial instruments recognised at the fair value on the date of receipt and
therefore the performance obligation is satisfied at a point in time when the Group has fully completed the performance obligations
per the contract.
Retainer fees
Retainer fees are recognised over the length of time of the agreement. Fees are fixed and invoiced quarterly in advance based on
the agreed engagement letter. The performance obligation is satisfied over time as the contractual obligations are on ongoing
throughout the period under contract. The deferred revenue is recognised as a contract liability.
55
Notes to the financial statements
3. Significant accounting policies (continued)
Corporate placing commissions
Corporate placing commissions are variable fees agreed on a deal by deal basis based on a percentage of the funds raised as part
of a transaction. This includes non-cash consideration received in the form of shares, loan notes, warrants or other financial
instruments recognised at the fair value on the date of receipt. Given that fees related to this work are success based, there is a
significant risk of reversal of the variable revenue and therefore the performance obligation is satisfied at a point in time when the
transaction is completed. The combination of corporate placing commissions and corporate finance advisory fees are referred to
as corporate success fees.
Employee benefits
The Group contributes to employees’ individual money purchase personal pension schemes. The assets of the schemes are held
separately from those of the Group in independently administered funds. The amount charged to the statement of comprehensive
income represents the contributions payable to the schemes in respect of the period to which they relate.
Short term employee benefits are those that fall due for payment within twelve months of the end of the period in which employees
render the related service. The cost of short term benefits is not discounted and is recognised in the period in which the related
service is rendered. Short term employee benefits include cash-based incentive schemes and annual bonuses.
Share-based payments
The share option programmes allows Group employees to receive remuneration in the form of equity-settled share-based payments
granted by the Company.
The cost of equity-settled transactions with employees is measured by reference to the fair value at the date at which they are
granted. The fair value of the options granted is measured using an option valuation model. The cost of equity-settled transactions
is recognised, together with a corresponding increase in equity, over the period in which the performance or service conditions are
fulfilled (the vesting period), ending on the date on which the relevant employees become fully entitled to the award (the vesting
date). The cumulative expense recognised for equity settled transactions, at each reporting date until the vesting date, reflects the
extent to which the vesting period has expired and the Group’s best estimate of the number of equity instruments that will ultimately
vest. The statement of comprehensive income charge or credit for a period represents the movement in cumulative expense
recognised at the beginning and end of that period.
Where the terms of an equity-settled award are modified, an incremental value is calculated as the difference between the fair value
of the repriced option and the fair value of the original option at the date of re-pricing. This incremental value is then recognised as
an expense over the remaining vesting period in addition to the amount recognised in respect of the original option grant.
Where an equity-settled award is cancelled or settled (that is, cancelled with some form of compensation) it is treated as if it had
vested on the date of cancellation and any expense not yet recognised for the award is recognised immediately.
However, if a new award is substituted for the cancelled award and is designated as a replacement award on the date that it is
granted, the cancelled and new awards are treated as if they were a modification of the original award, as described in the previous
paragraph. Any compensation paid up to the fair value of the award is accounted for as a deduction from equity. Where an award is
cancelled by forfeiture, when the vesting conditions are not satisfied, any costs already recognised are reversed (subject to
exceptions for market conditions).
In all instances, the charge/credit is taken to the statement of comprehensive income of the Group or Company by which the
individual concerned is employed.
56
Notes to the financial statements
3. Significant accounting policies (continued)
Employee Benefit Trust (EBT)
The cost of purchasing own shares held by the EBT are shown as a deduction against equity. The proceeds from the sale of own
shares held increase equity. Neither the purchase nor sale of own shares leads to a gain or loss being recognised in the consolidated
statement of comprehensive income.
Employee Share Ownership Trust (ESOT)
The Company has established an ESOT. The assets and liabilities of this trust comprise shares in the Company and loan balances
due to the Company. The Group includes the ESOT within these consolidated Financial Statements and therefore recognises a
Treasury shares reserve in respect of the amounts loaned to the ESOT and used to purchase shares in the Company. Any cash
received by the ESOT on disposal of the shares it holds, will be used to repay the loan to the Company.
Treasury shares
The costs of purchasing Treasury shares are shown as a deduction against equity. The proceeds from the sale of own shares held
increase equity. Neither the purchase nor sale of treasury shares leads to a gain or loss being recognised in the consolidated
statement of comprehensive income.
Income taxes
Income tax on the profit or loss for the years presented, comprising current tax and deferred tax, is recognised in the statement of
comprehensive income except to the extent that it relates to items recognised directly in equity, in which case it is recognised in
equity.
Current tax is the expected tax payable on the taxable income for the year, using rates enacted or substantively enacted at the
reporting year end date and any adjustment to tax payable in respect of previous years.
Deferred tax is provided for temporary differences, at the reporting year end date, between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes. The following temporary differences are not provided
for;
goodwill which is not deductible for tax purposes;
the initial recognition of assets or liabilities that affect neither accounting nor taxable profit; and
temporary differences relating to investments in subsidiaries to the extent that they will probably not reverse in the
foreseeable future.
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets
and liabilities, using tax rates enacted or substantively enacted at the reporting period end date (note 21).
A deferred tax asset is recognised for all deductible temporary differences and unused tax losses only to the extent that it is probable
that future taxable profits will be available against which the assets can be utilised. A deferred tax asset has been recognised, £190k
(FY21: £190k).
Plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and impairment. Depreciation is calculated, using the straight
line method, to write down the cost or revalued amount of plant and equipment over the assets’ expected useful lives, to their
residual values, as follows:
Computers, fixtures and fittings
–
4 to 7 years
Intangible assets
Measurement
Intangible assets with finite useful lives that are acquired separately are measured, on initial recognition at cost. Following initial
recognition, they are carried at cost less accumulated amortisation and any accumulated impairment. The cost of intangible
assets acquired in a business combination is their fair value at the date of acquisition
57
Notes to the financial statements
3. Significant accounting policies (continued)
Intangible assets (continued)
Intangible assets other than goodwill are amortised over the expected pattern of their consumption of future economic benefits, to
write down the cost of the intangible assets to their residual values as follows:
Client relationships
Brand
–
–
10 to 12 years
2 years
The amortisation period and method for an intangible asset are reviewed at least at each financial year end. Changes in the expected
useful life or the expected pattern of consumption of future economic benefits embodied in the asset or its residual value are
accounted for by changing the amortisation period or method.
Impairment
The carrying amounts of the Group’s intangible assets, excluding goodwill, are reviewed when there is an indicator of impairment
and the asset’s recoverable amount is estimated.
The recoverable amount is the higher of the asset’s fair value less costs to sell (or net selling price) and its value-in-use. Value-in- use
is the discounted present value of estimated future cash inflows expected to arise from the continuing use of the asset and from its
disposal at the end of its useful life. Where the recoverable amount of an individual asset cannot be identified, it is calculated for the
smallest cash-generating unit (CGU) to which the asset belongs. A CGU is the smallest identifiable group of assets that generates
cash inflows independently.
When the carrying amount of an asset (or CGU) exceeds its recoverable amount, the asset (or CGU) is considered to be impaired and
is written down to its recoverable amount. An impairment loss is immediately recognised as an expense. Any subsequent reversal
of impairment credited to the statement of comprehensive income shall not cause the carrying amount of the intangible asset to
exceed the carrying amount that would have been determined had no impairment been recognised.
Impairment of assets
Goodwill and other intangible assets that have an indefinite life are not subject to amortisation, they are tested annually for
impairment. Other assets are tested for impairment when any changes in circumstance indicate the carrying amount is possibly not
recoverable. An impairment loss is recognised when the asset’s carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less costs to sell and the value in use. Goodwill is allocated to cash generating units for
the purpose of assessing impairment, assets (excluding goodwill) are grouped together based on the assets that independently
generates cash flow whose cash flow is largely independent of the cash flows generated by other assets (cash generating units).
Leased assets
Measurement and recognition of leases as a lessee
For any new lease contracts entered into on or after 1 April 2019, as permitted under IFRS 16, the Group recognises a right of use
asset and a lease liability except for:
Leases with a term of 12 months or less from the lease commencement date
Leases of low value assets
Lease liabilities are measured at the present value of the unpaid lease payments discounted using an incremental borrowing rate.
Right of use assets are initially measured at the amount of the lease liabilities plus initial direct costs, costs associated with removal
and restoration and payments previously made. Right of use assets are amortised on a straight line basis over the term of the lease.
Lease liabilities are subsequently increased by the interest charge using the incremental borrowing rate and reduced by the principal
lease.
Financial instruments
Financial assets and financial liabilities are recognised in the Group’s balance sheet when the Group becomes a party to the
contractual provisions of the instrument.
58
Notes to the financial statements
3. Significant accounting policies (continued)
Financial assets and liabilities
Investments are recognised and derecognised on the trade date where the purchase or sale of an investment is under a contract
whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially
measured at fair value, plus transaction costs, except for those financial assets classified as at fair value through profit or loss, which
are initially measured at fair value.
Assets and liabilities are presented net where there is a legal right to offset and an intention to settle in that way.
The three principal classification categories for financial assets are: measured at amortised cost, fair value through other
comprehensive income (FVOCI) and fair value through profit or loss (FVTPL). The classification of financial assets under IFRS 9 is
generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics.
Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for
managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period
following the change in the business model.
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:
it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.
On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent
changes in the investment’s fair value in OCI. This election is made on an investment-by-investment basis.
All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at FVTPL. This includes
all derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset that otherwise meets the
requirements to be measured at amortised cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting
mismatch that would otherwise arise.
Assets held at FVTPL are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are
recognised in profit or loss.
Financial assets at amortised cost are subsequently measured at amortised cost using the effective interest method. The amortised
cost is reduced by impairment losses. Trade receivables and other receivables are measured and carried at amortised cost using
the effective interest method, less any impairment. If impaired, the carrying amount of other receivables is reduced by the
impairment loss directly and a charge is recorded in the Income Statement. For trade receivables, the carrying amount is reduced
by the expected credit lifetime losses under the simplified approach permitted under IFRS9. Subsequent recoveries of amounts
previously written off are credited against the allowance account and changes in the carrying amount of the allowance account are
recognised in the Income Statement.
Equity investments at OCI are subsequently measured at fair value. Dividends are recognised as income in profit or loss unless the
dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognised in OCI and are
never reclassified to profit or loss.
The following financial assets & liabilities are held at FVTPL; investments and deferred consideration. The following financial assets
and liabilities are held at amortised cost; Cash and cash equivalents, trade and other receivables, accrued income, trade and other
lease liabilities.
Trade payables
Trade payables principally comprise amounts outstanding for trade purchases and ongoing costs. The Directors consider that the
carrying amount of trade payables approximates to their fair value.
Deferred consideration
Deferred consideration is recognised at the discounted present value of amounts payable. Subsequent to initial recognition, it is
rebased over the period in which the consideration is payable, with the unwinding of the discount being taken to the statement of
comprehensive income.
59
Notes to the financial statements
4. Critical accounting judgements and key sources of estimation and uncertainty
The preparation of financial statements in accordance with IFRS requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates.
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including reasonable
expectations of future events. The estimates and judgements that have a significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the next financial year are discussed below:
Amortisation and impairment of non-financial assets
As noted above, the Group estimates the useful economic lives of intangible assets, in order to calculate the appropriate
amortisation charge. This is done by the Directors using their knowledge of the markets and business conditions that generated the
asset, together with their judgement of how these will change in the foreseeable future.
Where an indicator of impairment exists, value in use calculations are performed to determine the appropriate carrying value of the
asset. The value in use calculation requires the Directors to estimate the future cash flows expected to arise for the CGU and a
suitable discount rate in order to calculate present value. Where the actual future cash flows are less than expected, a material
impairment loss may arise (see note 16).
Goodwill is subject to an annual impairment review which is performed by comparing the balance value with the recoverable
amount of the asset or it’s CGU. The recoverable amount is the higher of the value in use and fair value to sell less costs.
Investments in subsidiaries
Where an indicator of impairment exists, management uses its judgement to assess the carrying value of the asset by determining
the fair value by independent assessment of the carrying value of the business units and by comparative analysis against other
similar businesses in the peer group. The carrying value of investments in subsidiaries at 31 March 2022 was £26.4m (FY21: £26.4m)
(see note 17).
Investments
Included in investments are unlisted shares totalling a value of £701k. Judgement has been applied to the value of these shares
based on recent transactions around the year end 31 March 2022. If the share price were to change by 2% the value of this investment
would change by £7k. Further details are provided in note 23.
Warrants
Included in non-current investments are warrants valued at the estimated fair value at the reporting date. These values are obtained
by applying an appropriate valuation model for which most of the inputs are based on contracts and external sources. Therefore no
reasonable change in assumptions would lead to a material change in the fair value.
Deferred consideration
As described in note 26, the Group has a deferred consideration balance in respect of the acquisition in December 2020 of Harpsden
Wealth Management Limited. The expected future payment is recognised at its fair value, this being the estimate of future payments
due. This has been discounted to present value using an estimated discount rate of 13.5% (2021: 13.5%).
60
Notes to the financial statements
5. Segment information
The Group has two principal operating segments, Wealth Management (WM) and Capital Markets (CM) and a number of minor
operating segments that have been aggregated into one operating segment.
WM offers investment management advice and services to individuals and contains our Wealth Planning business, giving advice on
and acting as intermediary for a range of financial products. CM provides corporate finance and corporate broking advice and
services to companies and acts as Nominated Adviser (Nomad) to clients traded on the AIM and contains our Institutional Sales and
Research business, which carries out stockbroking activities on behalf of companies as well as conducting research into markets of
interest to its clients.
Both divisions are located in the UK. Each reportable segment has a segment manager who is directly accountable to, and maintains
regular contact with, the Chief Executive Officer.
No customer represents more than ten percent of the Group’s revenue (FY21: nil).
The majority of the Group’s revenue originates within the UK with a non-material element originating overseas in the Isle of Man
which has been included in “Other Group companies” for the prior period of the year up until the sale of the IoM entity in August
2020.
The following tables represent revenue and cost information for the Group’s business segments:
Year ended 31 March 2022
Revenue
Direct costs
Contribution
Indirect costs
Underlying profit/(loss) before tax
Acquisition related costs
Amortisation of acquired brand and client relationships
Changes in fair value and finance cost of deferred
consideration
Restructuring costs
Net changes in the value of non-current investment assets
Profit/(loss) before tax
Tax
Profit/(loss) for the year
Wealth
Management
£'000
15,837
(13,072)
2,765
(3,013)
(248)
(446)
(505)
(416)
(478)
-
(2,093)
67
(2,026)
Capital
Markets
£'000
16,198
(12,475)
3,723
(1,427)
2,296
-
-
-
(357)
813
2,752
-
2,752
Group and
consolidation
adjustments
£'000
-
-
-
(651)
(651)
-
-
-
-
-
(651)
-
(651)
Year ended 31 March 2022
Statutory operating costs included the following:
Amortisation
Depreciation
Wealth
Management
£'000
505
199
Capital Markets
£'000
-
90
Group
£'000
32,035
(25,547)
6,488
(5,091)
1,397
(446)
(505)
(416)
(835)
813
8
67
75
Group
£'000
505
289
61
Notes to the financial statements
5. Segment information (continued)
Year ended 31 March 2021
Revenue
Direct costs
Contribution
Indirect costs
Underlying profit/(loss) before tax
Acquisition related costs
Amortisation of acquired client
relationships
Dual running operating platform costs
Restructuring costs
Net changes in the value of non-
current investment assets
Profit/(loss) before tax
Tax
Profit/(loss) for the year
Wealth
Management
Capital
Markets
£'000
13,291
(10,271)
3,020
(3,099)
(79)
(465)
(219)
(35)
(91)
(889)
2
(887)
£'000
15,467
(11,120)
4,347
(1,312)
3,035
-
-
(38)
414
3,411
-
3,411
Group and
consolidation
adjustments
£'000
467
(569)
(102)
(1,459)
(1,561)
Less
Discontinued
Operations
£'000
(484)
570
86
-
86
-
-
-
-
(1,561)
190
(1,371)
-
-
-
-
86
-
86
Group
(continuing
operations)
£'000
28,741
(21,390)
7,351
(5,870)
1,481
(465)
(219)
(35)
(129)
414
1,047
192
1,239
Year ended 31 March 2021
Wealth
Management
Capital
Markets
£'000
£'000
Group and
consolidation
adjustments
£'000
Less
Discontinued
Operations
£'000
Group
(continuing
operations)
£'000
Statutory operating costs included the following:
Amortisation
Depreciation
219
381
-
140
-
6
-
(6)
219
521
Segment assets and segment liabilities are reviewed by the Chief Executive Officer based on the consolidated statement of financial
position. Accordingly, this information is replicated in the Group Consolidated statement of financial position on page 46. As no
measure of assets or liabilities for individual segments is reviewed regularly by the Chief Executive Officer, no disclosure of total
assets or liabilities has been made.
The accounting policies of the operating segments are the same as those described in the summary of significant accounting
policies.
62
Notes to the financial statements
5. Segment information (continued)
Revenue disaggregated by division and timing of recognition below:
Year ended 31 March 2022
Point in time
Over time
Year ended 31 March 2021
Point in time
Over time
Wealth
Management
£'000
2,443
13,394
15,837
Capital
Markets
£'000
12,429
3,769
16,198
Group and
consolidation
adjustments
£'000
-
-
-
Group
£'000
14,872
17,163
32,035
Wealth
Management
Capital
Markets
£'000
3,419
9,872
13,291
£'000
11,786
3,681
15,467
Group and
consolidation
adjustments
£'000
35
432
467
Less
Discontinued
Operations
£'000
(53)
(431)
(484)
Group
(continuing
operations)
£'000
15,187
13,554
28,741
The following movement of contract liabilities was recognised in the year:
Group
Contract liabilities
As at 31 Mar
2021
£'000
372
Recognised
in revenue
£'000
(372)
Amounts
deferred
£'000
39
As at 31 Mar
2022
£'000
39
Contract liabilities relate to deferred recognition of retainer fees invoices quarterly. During the year the billing period was aligned to
the financial year quarters causing a reduction in contract liabilities at the year end 31 March 2022.
63
Notes to the financial statements
6. Operating profit/ (loss)
Group
Operating (loss)/profit is stated after charging/(crediting):
Depreciation of property, plant and equipment (note 13)
Amortisation of intangibles (note 16)
Short term and low value leases
IFRS 16 depreciation (note 19)
Employee benefit expense (note 7)
Restructuring and non-recurring legal and regulatory costs
Other administrative expenses
Auditors' remuneration:
Audit of these financial statements
Amounts payable to the principal auditors and their associates in respect of:
- audit of financial statements of subsidiaries pursuant to legislation
- audit related assurance services
Expected credit loss (note 22)
Total
Year ended
31 Mar 2022
£'000
Year ended
31 Mar 2021
£'000
289
505
59
435
21,300
1,191
9,083
521
219
-
502
19,260
616
7,097
50
52
95
55
33,062
81
33,143
106
17
28,390
28
28,418
Other administrative expenses are incurred in the ordinary course of the business and do not include any non-recurring items.
64
Notes to the financial statements
7. Employee benefit expense
The Group claimed £7k of grants during the year (FY21: £180k) from the UK Government through the Coronavirus Job Retention
Scheme. No staff remained on furlough from 30 June 2021.
Non-salaried staff are commission-only brokers and therefore do not receive a salary.
Group
Wages and salaries
Bonuses
Social security costs
Other pension costs
Non salaried staff
Other administrative expenses
Charge for share options granted to employees (note 32)
Less amounts included within Restructuring and non-recurring costs
Company
Wages and salaries
The average number of persons (including Directors) employed during the year was:
Group
Executive and senior management
Corporate Broking
Wealth Management
Support staff
Salaried staff
Non salaried staff
Total
Company
Executive and senior management
Year ended
31 Mar 2022
£'000
12,139
2,148
1,975
508
16,770
4,895
21,665
470
(835)
21,300
Year ended
31 Mar 2022
£'000
260
Year ended
31 Mar 2022
8
42
75
26
151
7
158
Year ended
31 Mar 2021
£'000
9,162
3,801
1,634
401
14,998
4,301
19,299
90
(129)
19,260
Year ended
31 Mar 2021
£'000
167
Year ended
31 Mar 2021
8
35
64
24
131
8
139
Year ended
31 Mar 2022
4
Year ended
31 Mar 2021
5
The total amount paid to Directors in the period, including social security costs was £1.6m (FY21: £1.0m). Full details of Directors’
remuneration, including that of the highest paid Director, are disclosed in the Remuneration Report on pages 35-38 of these financial
statements.
65
Notes to the financial statements
8. Finance income and expense
Group
Bank interest receivable
Finance income
Interest payable on lease liabilities
Fair value and present value discount of deferred consideration (see note 26)
Other interest
Finance expense
9. Taxation
Group
Current tax expense:
United Kingdom corporation tax at 19% (FY21: 19%)
Total current tax
Deferred tax credit (note 21):
Current year
Effect of change in tax rate
Total deferred tax
Total tax in the statement of comprehensive income
Year ended
31 Mar 2022
£'000
Year ended
31 Mar 2021
£'000
1
1
93
416
2
511
2
2
-
95
-
1
96
Year ended
31 Mar 2022
£'000
Year ended
31 Mar 2021
£'000
-
-
(67)
-
(67)
(67)
-
-
(192)
-
(192)
(192)
66
Notes to the financial statements
9. Taxation (continued)
The tax credit for the year and the amount calculated by applying the standard United Kingdom corporation tax rate of 19% (FY21:
19%) to profit before tax can be reconciled as follows:
Group
Profit before tax
Tax expense using the United Kingdom corporation tax rate of 19% (FY21: 19%)
Other expenses not tax deductible
Income not chargeable to tax
Movement in unrecognised deferred tax
Difference in overseas tax rates
Total tax credit in the statement of comprehensive income
Year ended
31 Mar 2022
Year ended
31 Mar 2021
£'000
8
2
183
(6)
(246)
-
(67)
£'000
1,047
199
4,845
(4,753)
(522)
39
(192)
10. Discontinued operations and assets & liabilities held for sale
2021 – Disposal of WH Ireland (IOM) Limited
The Group announced its intention to sell its subsidiary WH Ireland (IOM) Limited on 29 June 2020, and the sale subsequently
completed on 21 August 2020. In accordance with IFRS 5 non-current assets held for sale and discontinued operations, the results
for WH Ireland (IOM) Limited were included in discontinued operations in the prior period; its assets and liabilities were classified as
held for sale and recorded at the lower of the carrying value and fair value less costs to sell. The associated assets and liability were
therefore presented as held for sale in the prior year’s financial statements.
Financial performance and cash flow information
Revenue
Administrative expenses
Operating profit
Loss on disposal of discontinued operations
Finance income
Finance expense
(Loss) before tax
Tax
(Loss) from discontinued operations
Year ended
31 Mar 2021
£'000
484
(433)
51
(137)
-
-
(86)
-
(86)
67
Notes to the financial statements
10. Discontinued operations and assets & liabilities held for sale (continued)
Net cash generated from operations
Net cash generated from investing activities
Net cash used in financing activities
Net decrease in cash and cash equivalents
Year ended
31 Mar 2021
£'000
163
1
(997)
(833)
Assets and liabilities of disposal group classified as held for sale
The assets and liabilities relating to WH Ireland (IOM) Limited were reclassified as held for sale at 31 March 2020. As at 31 March
2021, these were all nil values as the sale of WH Ireland (IOM) Limited completed on 21 August 2020.
11. Dividend
No dividend is proposed in respect of 2022 (FY21: none).
12. Earnings per share
Basic EPS is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number
of ordinary shares in issue during the year, excluding ordinary shares purchased by the Company (note 29).
Diluted EPS is the basic EPS, adjusted for the effect of the conversion into fully paid shares of the weighted average number of all
employee share options outstanding. In a year when the Company presents positive earnings attributable to ordinary shareholders,
anti-dilutive options represent options issued where the exercise price is greater than the average market price for the period.
Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below:
Group
Weighted average number of shares in issue during the period
Effect of dilutive share options
(thousands)
From continuing operations
Profit for the year attributable to ordinary shareholders (£'000)
Basic
Diluted
From discontinued operations
Loss for the year attributable to ordinary shareholders (£'000)
Basic
Diluted
Total
Profit for the year attributable to ordinary shareholders (£'000)
Basic
Diluted
*The comparative dilutive share options have been restated, further details can be found in note 3.
Year ended
31 Mar 2022
Year ended
31 Mar 2021*
59,692
1,190
50,249
683
60,882
50,932
75
0.13p
0.12p
-
-
-
75
0.13p
0.12p
1,239
2.47p
2.43p
(86)
(0.17p)
-
1,153
2.30p
2.26p
68
Notes to the financial statements
13. Property, plant and equipment
Group
Computers,
fixtures and fittings
£'000
Company
Computers,
fixtures and fittings
£'000
Cost
At 31 March 2020
Additions
At 31 March 2021
Additions
At 31 March 2022
Depreciation and impairment
At 31 March 2020
Depreciation charge
At 31 March 2021
Depreciation charge
At 31 March 2022
Net book values
At 31 March 2022
At 31 March 2021
5,444
201
5,645
103
5,748
4,613
521
5,134
289
5,423
325
511
33
-
33
4
37
-
33
-
33
-
33
-
4
-
69
Notes to the financial statements
14. Business Combinations
2021 - Acquisition of Harpsden Wealth Management Limited
On 22 December 2020, WH Ireland Group Plc acquired Harpsden Wealth Management Limited (Harpsden) for a total consideration
of £7.4m.
The fair value of the assets and liabilities of Harpsden as at the date of acquisition are as per the table below:
Book value
£'000
Adjustments
£'000
Fair value
£'000
Net Assets at date of acquisition:
Intangible assets
Tangible assets
Debtors
Cash
Creditors
Deferred tax liability
Net assets acquired
Goodwill arising on acquisition
Total
Discharged by:
Initial cash consideration
Deferred consideration payable
Effect of discounting of deferred consideration
Costs associated with acquisition
Total
-
13
309
671
(523)
-
470
4,225
-
-
-
-
(803)
3,422
4,225
13
309
671
(523)
(803)
3,892
3,539
7,431
5,300
2,585
(589)
135
7,431
In the period from acquisition to 31 March 2021, the Harpsden acquisition earned revenue of £782k and statutory profit before tax
of £125k.
70
Notes to the financial statements
15. Goodwill
Goodwill acquired in a business combination is allocated to a cash generating unit (CGU) that will benefit from that business
combination.
The carrying amount of goodwill acquired in the acquisition of Harpsden Wealth Management is set out below:
Group
Beginning of year
Acquisition of subsidiaries
End of year
Year ended
31 Mar 2022
Year ended
31 Mar 2021
£'000
3,539
-
3,539
£'000
-
3,539
3,539
Goodwill is assessed annually for impairment and the recoverability has been assessed at 31 January 2022 by comparing the carrying
value of the CGU to which the goodwill is allocated against its recoverable amount. The recoverable amount is the higher of the
CGU’s fair value less cost to sell and the value in use. The value in use has been calculated using pre-tax discounted cash flow
projections based on the most recent budgets and forecasts approved by the board of directors.
The projections cover a five year period and a terminal multiple has been applied to the cashflows extrapolating the projections
consistent with the assumed indefinite useful life of the goodwill.
The Harpsden CGU recoverable amount was calculated as £10.94m, indicating that there is no impairment. The main underlying
assumptions used in the calculations are the pre-tax discount rate, the short term growth in revenue and expenditure and the long
term growth rate to perpetuity. The revenue growth used in the cash flow forecast is based on the AUM forecasts multiplied by the
relevant yields. AUM forecasted growth ranges from 5% to 13%. Cash outflows have been estimated at 5% annual increase where
no other significant growth has been forecasted. A pre-tax discount rate of 14.7% has been used. This is based on the Group’s
assessment of the risk-free rate of interest and specific risks relating to Harpsden. A 2% long-term growth rate has been applied,
which is prudent when compared against the growth rates used in the forecast calculations for the first five years.
Sensitivity analysis has been performed and no impairment would arise if either of the following occurred:
An increase in pre-tax discount rate from 14.7% to 16.7%
A fall in perpetuity growth rate from 2% to -3%
No AUM growth in the first year of the forecast
An impairment would arise if there was no increase in AUM over the five year forecast and the subsequent terminal growth was 0%.
71
Notes to the financial statements
16. Intangible assets
Client relationships arise when the group acquires a broker business with an existing client base. The assets below represent the
fair value of future benefits arising from these client relationships. Amortisation of client relationships is charged to administrative
expenses in the consolidated statement of comprehensive income on a straight line basis over the estimated useful lives (2 to 12
years). No impairment indicators were present for the acquired client relationship contracts.
Group
Cost
At 31 March 2020
Additions
At 31 March 2021
Additions
At 31 March 2022
Amortisation
At 31 March 2020
Charge for the year
At 31 March 2021
Charge for the year
At 31 March 2022
Net book values
At 31 March 2022
At 31 March 2021
Client
relationships
£'000
4,581
4,150
8,731
-
8,731
3,823
210
4,033
467
4,500
4,231
4,698
Brand
£’000
-
75
75
-
75
-
9
9
38
47
28
66
Total
£’000
4,581
4,225
8,806
-
8,806
3,823
219
4,042
505
4,547
4,259
4,764
During the year ended 31 March 2021, the group acquired client relationships totalling £4.2m as part of the Harpsden acquisition
(note 14) and at the year ending 31 March 2022 the net book value was £3.72m and remaining useful economic life of 9 years. An
intangible asset was also recognised representing the Harpsden brand totalling £75k and at the year ending 31 March 2022 the net
book value was £28k and remaining useful economic life of 1 year.
An intangible asset was recognised relating to the client relationships brought in by Robert Race when he joined the group. At the
year ended 31 March 2022 the net book value was £489k and remaining useful economic life of 4 years.
The company did not have any intangible assets either at 31 March 2022 or 31 March 2021.
72
Notes to the financial statements
17. Subsidiaries
Company
Beginning of year
Additions
Disposals
End of year
Year ended
31 Mar 2022
£'000
26,448
-
-
26,448
Year ended
31 Mar 2021
£'000
19,298
7,433
(283)
26,448
Investments in subsidiaries are stated at cost less impairment.
During the financial year the Group raised £Nil (FY21: £5.3m) by way of placings to existing and new shareholders. In the prior year
the Group used the placings to fund the purchase of Harpsden Wealth Management Limited.
The Company’s subsidiaries, all of which are included in the consolidated financial statements, are presented below:
Subsidiary
WH Ireland Limited
Harpsden Wealth Management
Limited
WH Ireland (Financial Services)
Limited
Readycount Limited
Stockholm Investments Limited
ARE Business and Professional
Limited
SRS Business and Professional
Limited
WH Ireland Nominees Limited
WH Ireland Trustee Limited
Fitel Nominees Limited
Country of
incorporation
England & Wales
Principal activity
Class of
shares
WM and CIB Ordinary
Proportion held
by Group
100%
England & Wales
WM Ordinary
England & Wales
England & Wales
England & Wales
Dormant Ordinary
Dormant Ordinary
Dormant Ordinary
England & Wales
Dormant Ordinary
England & Wales
England & Wales
England & Wales
England & Wales
Dormant Ordinary
Nominee Ordinary
Trustee Ordinary
Nominee Ordinary
100%
100%
100%
100%
100%
100%
100%
100%
100%
Proportion
held by
Company
100%
100%
-
100%
100%
-
-
-
-
-
The registered office of Harpsden Wealth Management Limited is Newtown House, Newtown Road, Henley-on-Thames, Oxfordshire
RG9 1HG.
The registered office of all other companies listed above is 24 Martin Lane, London, EC4R 0DR.
The following dormant subsidiaries are guaranteed by the Company and therefore take advantage of the Companies Act (2006) in
obtaining exemption from an individual audit:
Subsidiary
WH Ireland (Financial Services) Limited
Readycount Limited
Stockholm Investments Limited
ARE Business and Professional Limited
SRS Business and Professional Limited
WH Ireland Nominees Limited
WH Ireland Trustee Limited
Fitel Nominees Limited
Country of
incorporation
Company registration
number
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
4279349
3164863
4215675
3681185
4238969
2908691
3559373
1401140
73
Notes to the financial statements
18. Investments
Group
Financial assets at fair value through profit or loss
At 31 March 2021
At 31 March 2022
Other financial assets at fair value through profit or loss
At 31 March 2020
Additions*
Fair value gain*
Disposals*
At 31 March 2021
Additions
Fair value gain
Disposals
At 31 March 2022
Total investments at 31 March 2022
Total investments at 31 March 2021
Quoted
£'000
-
-
Quoted
£'000
1
-
-
-
1
-
-
-
1
1
1
Unquoted
£'000
48
48
Warrants*
£'000
229
823
46
(48)
1,050
850
1,072
(8)
2,964
3,012
1,098
Total
£'000
48
48
Total
£'000
230
823
46
(48)
1,051
850
1,072
(8)
2,965
3,013
1,099
* The comparative additions and fair value gain have been restated. Further details can be found in note 3 of these financial statements
Financial assets at fair value through profit or loss include equity investments other than those in subsidiary undertakings. These
are measured at fair value with fair value gains and losses recognised through profit and loss.
Other investments, in the main, comprise financial assets designated as fair value through profit or loss and include warrants and
equity investments.
Warrants may be received during the ordinary course of business and are designated as fair value through profit or loss. There is no
cash consideration associated with the acquisition.
Fair value, in the case of quoted investments, represents the bid price at the reporting year end date. In the case of unquoted
investments, the fair value is estimated by reference to recent arm’s length transactions. The fair value of warrants is estimated using
established valuation models.
The fair value of the warrants was determined using the Black Scholes model and grouped within level 3 with fair value
measurements derived from formal valuation techniques (see note 27). The key inputs into this calculation are the share price as at
31 March 2022, exercise price, risk free interest rate and volatility which is based on the share price movements during the period 1
December 2021 to 31 March 2022.
Included in non-operational income is the fair value gain totalling £1,072k (2021: £46k).
Net gains on investing activities
Fair value gain on warrants
Fair value gain on investments
Total net gain on investing activities
ref
23
Year ended
31 Mar 2022
£'000
1,072
554
1,626
Year ended
31 Mar 2021*
£'000
46
772
818
*The comparative information for the year end 31 March 2021 has been restated to reflect the correct net gains on investment from revenue, further details can
be found in note 3 of these financial statements.
74
Notes to the financial statements
19. Right of use asset & lease liability
Cost
At 31 March 2020
Adjustment for deferred rent invoices
Correction of calculation of right of use asset
At 31 March 2021
Additions
At 31 March 2022
Depreciation and impairment
At 31 March 2020
Charge for the year
At 31 March 2021
Charge for the year
At 31 March 2022
Net book values
At 31 March 2022
At 31 March 2021
Leasehold
Properties
£'000
3,036
(50)
(319)
2,667
-
2,667
562
502
1,064
435
1,499
1,168
1,603
Maturity of discounted lease payments in relation to non-cancellable leases
The table below represents the minimum lease payments in relation to non-cancellable leases where the group is a lessee:
Group
2022
2021
Group
Payable within 1
year
£'000
376
552
Payable in 2 to 5
years
£'000
956
1,295
Payable after
more than 5
years
£'000
43
211
Total contractual
payments
£'000
1,375
2,058
75
Notes to the financial statements
19. Right of use asset & lease liability (continued)
The following represents the lease expense in relation to leases which is recognised in the statement of comprehensive income:
Group
Depreciation of right of use asset
Interest charge
Total charge
Year ended
31 Mar 2022
£'000
435
85
520
Year ended
31 Mar 2021
£'000
502
95
597
Nature of leases
The Group leases a number of properties in the jurisdictions it operates.
These leases are usually for a fixed term although the Group sometimes negotiates break clauses in its leases. On a case-by-case
basis, the Group will consider whether the absence of a break clause would expose the group to excessive risk. Typically factors
considered in deciding to negotiate a break clause include:
the length of the lease term;
the economic stability of the environment in which the property is located; and
whether the location represents a new area of operations for the Group
As at 31 March 2022, the carrying amounts of the lease liabilities are not reduced by the amounts that would not be paid as a result
of exercising the break clauses because the Group does not anticipate to exercise its rights to the break clauses.
The total cash outflow for leases, including short-term leases, in the year ending 31 March 2022 was £827k (FY21: £898k)
Payments associated with short-term leases and all leases of low-value assets are recognised on a straight-line basis in
administrative expenses. Short-term leases are leases with a lease term of 12 months or less without a purchase option.
The Company did not have any right of use assets or lease liabilities either at 31 March 2022 or 31 March 2021.
20. Subordinated loan
Company
Beginning of year
Disposals
End of year
Year ended
31 Mar 2022
£'000
-
-
-
Year ended
31 Mar 2021
£'000
985
(985)
-
This interest-free, subordinated loan was originally issued to WH Ireland (IOM) Limited on 31 March 2014 and was increased in line
with the needs of the subsidiary. As part of the agreement for the sale of WH Ireland (IOM) Limited, announced on 29 June 2020, the
subordinated loan was repaid on completion, 21 August 2020. Accordingly, the loan was classified as a current asset in the prior
year. The impact of applying IFRS 9 has been considered and probability of default was assessed and consequently, it was
determined that the expected credit loss is nil.
76
Notes to the financial statements
21. Deferred tax assets and liabilities
Deferred tax is provided for temporary differences, at the reporting year end date, between the tax bases of assets and liabilities and
their carrying amounts for financial reporting purposes using a tax rate of 19% (FY21: 19%). A deferred tax asset is recognised for all
deductible temporary differences and unutilised tax losses only to the extent that it is probable that future taxable profits will be
available against which the assets can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the
related tax benefit will be realised.
A net deferred tax liability has been recognised in the year:
Group
Tax losses
Intangible acquired on business combinations
Other
Deferred tax liability
Year ended
31 Mar 2022
£'000
190
(736)
4
(542)
Year ended
31 Mar 2021
£'000
190
(803)
4
(609)
The change in deferred tax assets and liabilities during the year was as follows:
Group
Deferred tax asset
As at 1 April 2020
Charge to the Consolidated statement of comprehensive income
As at 31 March 2021
As at 31 March 2022
Trading losses carried
forward
£'000
190
-
190
190
Total
£'000
190
-
190
190
The carrying amount of the deferred tax asset is reviewed at each reporting date and is only recognised to the extent that it is
probable that future taxable profits of the Group will allow the asset to be recovered.
Group
Deferred tax liabilities
As at 1 April 2020
Adjustment on acquisition of business combination
Other
As at 31 March 2021
Credit to the Consolidated statement of comprehensive income
As at 31 March 2022
Intangible asset
amortisation
£'000
-
803
(4)
799
(67)
732
The unrecognised tax losses and fixed asset timing differences amount to £13.4m (FY21: £16.0m).
The Company had no deferred tax balances either at 31 March 2022 or 31 March 2021.
Total
£'000
-
803
(4)
799
(67)
732
77
Notes to the financial statements
22. Trade and other receivables
Trade receivables
Other receivables
Accrued income
Prepayments
Group
Company
31 Mar 2022
£'000
751
893
3,079
1,035
5,758
31 Mar 2021
£'000
1,322
1,065
2,139
630
5,156
31 Mar 2022
£'000
-
95
-
18
113
31 Mar 2021
£'000
-
47
-
9
56
The carrying value of trade and other receivable balances are denominated fully in British pounds (FY21: 100%).
Accrued income relates to management fee accruals. Management fees are accrued on a monthly basis and reconciled to fees
collected quarterly. Consideration to IFRS 9 has been made and it has been determined that there is a low probability of default and
therefore the expected credit loss is not material.
The impact of applying IFRS 9 to intercompany balances for the Company has been considered and probability of default was
assessed and consequently, it was determined that the expected credit loss is not material.
Fees and charges owed by clients are generally considered to be past due where they remain unpaid five working days after the
relevant billing date. At 31 March 2022, trade receivables (net of provisions for impairment and doubtful debts) comprised of the
following:
Group
Company
31 Mar 2022
£'000
-
-
-
-
-
-
-
Included in aged receivables more than 45 days past due is the provisions for impairment of £502k (FY21: £421k).
Not past due
Up to 5 days due
from 6 to 15 days past due
From 16 to 30 days past due
From 31 to 45 days past due
More than 45 days past due
31 Mar 2022
£'000
194
9
219
1
113
215
751
31 Mar 2021
£'000
496
-
42
148
68
568
1,322
31 Mar 2021
£'000
-
-
-
-
-
-
-
Trade receivables are largely amounts due from retainer clients, who are invoiced on a quarterly basis in advance. The Group’s policy
is to allow 30 days for payment. Consequently, these receivables have no significant financing component and the Group have
applied the simplified approach in line with IFRS 9. Calculation of loss allowances are measured at an amount equal to lifetime
expected credit losses (ECLs). The approach taken by the Group in arriving at the expected credit loss is as follows:
Step 1: The Group have determined the appropriate brackets by grouping each trade receivables based on the ageing structure.
Step 2: Having determined the appropriate groupings, a historical loss rate (adjusted for forward looking information) was
calculated for each age bracket by reviewing the pattern of payment of trade receivables over the past 12 months.
Step 3: This historical loss rate (adjusted for forward looking information) has been applied to each ageing bracket of trade
receivables as at the balance sheet date to arrive at an expected credit loss for each grouping. All trade receivables over 365 days
have a 100% historical loss rate loss applied to them.
78
Notes to the financial statements
22. Trade and other receivables (continued)
Based on the above, the group recognised an expected credit loss of £81k (FY21: £28k expected credit loss).
The maximum exposure to credit risk, before any collateral held as security, is the carrying value of each class of receivable set out
above.
The Directors consider that the carrying amounts of trade and other receivables approximate their fair value.
Movements in impairment provisions were as follows:
Opening balance
Amount released from provision due to recovery
Amounts written off, previously fully provided
Amount charged to the statement of comprehensive
income
Closing balance
Group
Company
31 Mar 2022
£'000
421
(57)
-
138
502
31 Mar 2021
£'000
458
(57)
(65)
31 Mar 2022
£'000
-
-
-
31 Mar 2021
£'000
-
-
-
85
421
-
-
-
-
23. Other investments
Current asset investment
Restricted cash
Total
Group
Company
31 Mar 2022
£'000
1,490
422
1,912
31 Mar 2021
£'000
962
1,528
2,490
31 Mar 2022
£'000
-
-
-
31 Mar 2021
£'000
-
-
-
Current asset investments represent short-term principal positions in the form of listed and unquoted investments which are held
at market value.
Included in current asset investments are unquoted investments totalling a value of £701k. Judgement has been applied to the
value of these shares based on recent transactions around the year end 31 March 2022. If the share price were to change by 2% the
value of this investment would change by £7k.
Restricted cash represents monies held by the Group which have some restrictions on their conversion to cash.
Included in non-operational income is the fair value gain and the sale of investments. Further details can be found in note 18.
24. Cash and cash equivalents
Cash and cash equivalents
Group
Company
31 Mar 2022
£'000
6,446
31 Mar 2021
£'000
8,211
31 Mar 2022
£'000
1,246
31 Mar 2021
£'000
1,246
For the purposes of the cash flow statement, cash and cash equivalents comprise cash in hand and deposits with banks and financial
institutions with a maturity of up to three months.
Cash and cash equivalents represent the Group’s and the Company’s money and money held for settlement of outstanding
transactions.
Money held on behalf of clients is not included in cash and cash equivalents on the statement of financial position. Client money at
31 March 2022 for the Group was £366k (FY21: £401k). There is no client money held in the Company (FY21: £nil).
79
Notes to the financial statements
25. Trade and other payables
Trade payables
Amounts due to Group companies
Other payables
Tax and social security
Deferred income
Accruals
Group
Company
31 Mar 2022
£'000
2,963
-
319
886
39
2,474
6,681
31 Mar 2021
£'000
1,897
-
618
662
372
4,074
7,623
31 Mar 2022
£'000
84
2,194
-
-
1
78
2,357
31 Mar 2021
£'000
35
2,824
-
-
1
100
2,960
The Directors consider that the carrying amounts of trade and other payables approximate their fair value.
Deferred income relates to retainer fees invoiced in advance and spread over the length of the period, typically quarterly. The
balance at year end was fully recognised in the following financial year.
Amounts due to Group companies are unsecured, interest free and repayable on demand.
26. Deferred consideration
Group
At 31 March 2020
Additions during the year:
Paid during the year
At 31 March 2021
Additions during the year:
Charged to Statement of Comprehensive Income
At 31 March 2022
£'000
-
1,996
-
1,996
-
416
2,412
The increase in deferred consideration in the year ended 31 March 2022 represents the fair value adjustment and unwinding of
present value discount.
Included in current liabilities
Included in non-current liabilities
31 Mar 2022
£'000
2,412
-
2,412
31 Mar 2021
£'000
1,087
909
1,996
Deferred consideration relates to the acquisition of Harpsden and the maximum amounts payable over a two year period. The
following assumptions were made: revenue growth of 2%, attrition rate of 3% for larger clients and 10% for smaller clients, discount
rate of 13.5%.
80
Notes to the financial statements
27. Financial risk management
The fair value of all of the Group’s and the Company’s financial assets and liabilities approximated to their carrying value at the
reporting year end date. The carrying amount of non-current financial instruments, including floating interest rate borrowing, are
not significantly different from the fair value of these instruments based on discounted cash flows. The significant methods and
assumptions used in estimating fair values of financial instruments are summarised below:
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include equity investments, other than those in subsidiary undertakings. In the
case of listed investments, the fair value represents the quoted bid price at the reporting period end date. The fair value of unlisted
investments is estimated by reference to recent arm’s length transactions.
Other investments
Other investments include warrants and equity investments, categorised as fair value through profit or loss. In the case of listed
investments, the fair value represents the quoted bid price at the reporting year end date. The fair value of unlisted investments is
estimated by reference to recent arm’s length transactions. In the case of warrants, the fair value is estimated using established
valuation models.
Trade receivables and payables
The carrying value less impairment provision of trade receivables and payables is assumed to approximate to their fair values due
to their short-term nature.
Borrowings
Borrowings are measured at amortised cost using the effective interest rate method. The tables below summarise the Group’s main
financial instruments by financial asset type:
Group
Financial assets
Investments
Other investments
Trade and other receivables
Cash and cash equivalents
Financial liabilities
Trade and other payables
Lease liability
31 March 2022
Amortised cost
£'000
Fair value through
profit or loss
£'000
-
-
4,723
6,446
5,756
1,375
48
4,877
-
-
-
-
Total
£'000
48
4,877
4,723
6,446
5,756
1,375
81
Notes to the financial statements
27. Financial risk management (continued)
Group
Financial assets
Investments
Other investments
Trade and other receivables
Cash and cash equivalents
Financial liabilities
Trade and other payables
Lease Liability
31 March 2021
Fair value through
profit or loss
£'000
Amortised cost
£'000
-
-
4,526
8,211
6,589
2,058
48
3,541
-
-
-
-
The tables below summarise the Company’s main financial instruments by financial asset type:
Company
Financial assets
Trade and other receivables
Cash and cash equivalents
Financial liabilities
Trade and other payables
Group balances
Company
Financial assets
Trade and other receivables
Cash and cash equivalents
Financial liabilities
Trade and other payables
Group balances
31 March 2022
Fair value through
profit or loss
£'000
Amortised cost
£'000
95
1,246
162
2,194
-
-
-
-
31 March 2021
Fair value through
profit or loss
£'000
Amortised cost
£'000
47
1,246
135
2,824
-
-
-
-
Total
£'000
48
3,541
4,526
8,211
6,589
2,058
Total
£'000
95
1,246
162
2,194
Total
£'000
47
1,246
135
2,824
Risks
The main risks arising from the Group’s financial instruments are credit risk, liquidity risk and market risk. Market risk comprises,
interest rate risk and other price risk. The Directors review and agree policies for managing each of these risks which are summarised
below:
Credit risk
Credit risk is the risk that clients or other counterparties to a financial instrument will cause a financial loss by failing to meet their
obligations. Credit risk relates, in the main, to the Group’s trading and investment activities and is the risk that third parties fail to
pay amounts as they fall due. Formal credit procedures include approval of client limits, approval of material trades, collateral in
place for trading clients and chasing of overdue accounts. Additionally, risk assessments are performed on banks and custodians.
The maximum exposure to credit risk at the end of the reporting period is equal to the statement of financial position figure. The
impairment policy can be found in note 22. There were no other past due, impaired or unsecured debtors.
82
Notes to the financial statements
27. Financial risk management (continued)
Financial assets that are neither past due nor impaired in respect of trade receivables relate mainly to accrued management fees.
The credit risk on liquid funds, cash and cash equivalents is limited due to deposits being held at the Group’s main bank with a credit
rating of “A”, assigned by Standard and Poor’s.
There has been no change to the Group’s exposure to credit risk or the manner in which it manages and measures the risk during
the period.
The credit risk in the Company principally comes from intercompany balances and subordinated loan. Since these are all within the
Group, the Directors are able to closely monitor the risk of default on a regular basis to minimise any potential losses.
Liquidity risk
Liquidity risk is the risk that obligations associated with financial liabilities will not be met. The Group monitors its risk to a shortage
of funds by considering the maturity of both its financial investments and financial assets (for example, trade receivables) and
projected cash flows from operations.
The Group’s objective is to maintain the continuity of funding through the use of bank facilities where necessary, which are reviewed
annually with the Group’s Banker, the Bank of Scotland. Items considered are limits in place with counterparties which the bank are
required to guarantee, payment facility limits, as well as the need for any additional borrowings.
The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments:
Group
Trade and other payables
Lease liability
Deferred consideration
Group
Trade and other payables
Lease liability
Deferred consideration
31 March 2022
Payable within
1 year
£'000
5,756
568
2,500
8,824
Payable in 2 to
5 years
£'000
-
1,032
-
1,032
Payable after
more than 5
years
£'000
-
31
-
31
Total
contractual
payments
£'000
5,756
1,631
2,500
9,887
31 March 2021
Payable within
1 year
£'000
6,589
634
1,250
8,473
Payable in 2 to
5 years
£'000
-
1,425
1,250
2,675
Payable after
more than 5
years
£'000
-
206
-
206
Total
contractual
payments
£'000
6,589
2,265
2,500
11,354
83
Notes to the financial statements
27. Financial risk management (continued)
The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted
payments:
Company
Trade and other payables
Company
Trade and other payables
31 March 2022
Payable within
1 year
£'000
162
Payable in 2 to
5 years
£'000
-
Payable after
more than 5
years
£'000
-
Total
contractual
payments
£'000
162
31 March 2021
Payable within
1 year
£'000
135
Payable in 2 to
5 years
£'000
-
Payable after
more than 5
years
£'000
-
Total
contractual
payments
£'000
135
Market Risk
Interest rate risk
The Group’s exposure to the risk of changes in market interest rates relates to the Group’s amount of interest receivable on cash
deposits. The maximum exposure for interest is not significant.
Other price risk
Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
prices (other than those arising from interest rate risk) whether those changes are caused by factors specific to the individual
financial instrument or its issuer or factors affecting all similar financial instruments traded in the market. Other investments are
recognised at fair value and subject to changes in market prices.
The Group manages other price risk by monitoring the value of its financial instruments on a monthly basis and reporting these to
the Directors and Senior Management. The Group has disposed of a number of its investments during the course of the year, which
has helped mitigate risk. However, the risk of deterioration in prices remains high whilst the market continues to be volatile.
The risk of future losses is limited to the fair value of investments as at the year-end of £4,925k (FY21: £3,589k). See note 18 and 23.
84
Notes to the financial statements
27. Financial risk management (continued)
Fair value measurement recognised in the statement of financial position
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 at fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets
and 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). The valuation technique used in determining
the fair value is the Black Scholes model. The key inputs into this calculation are the share price as at 31 March 2022,
exercise price, risk free interest rate and volatility which is based on the share price movements during the period 1
December 2021 to 31 March 2022.
Financial assets at fair value through profit or loss
Unquoted equities
Financial instruments designated at fair value
through profit or loss
Quoted equities
Other investments (note 18 & 23)
Deferred consideration
Total
Financial assets at fair value through profit or loss
Unquoted equities
Financial instruments designated at fair value
through profit or loss
Quoted equities
Other investments (note 18 & 23)
Deferred consideration
Total
Level 1
£'000
701
-
1,211
-
1,912
Level 1
£'000
-
-
2,490
-
2,490
31 March 2022
Level 2
£'000
-
-
-
-
-
31 March 2021
Level 2
£'000
-
-
-
-
Level 3
£'000
Total
£'000
48
749
1
2,964
(2,412)
601
Level 3
£'000
48
-
1,051
(1,996)
(897)
1
4,175
(2,412)
2,513
Total
£'000
48
-
3,541
(1,996)
1,593
85
Notes to the financial statements
28. Capital management
The capital of the Group comprises share capital, share premium, retained earnings and other reserves. The total capital at 31 March
2022 amounted to £15.4m for the Group (FY21: £15.1m) and £23.9m for the Company (FY21: £23.4m). The primary objective of the
Group’s capital management is to ensure that it maintains a strong capital structure in order to support the development of its
business, to maximise shareholder value and to provide benefits for its other stakeholders.
These objectives are met by managing the level of debt and setting dividends paid to shareholders at a level appropriate to the
performance of the business.
Certain activities of the Group are regulated by the FCA which is the statutory regulator for financial services business and has
responsibility for policy, monitoring and discipline for the financial services industry. The FCA requires the Group’s resources to be
adequate, that is, sufficient in terms of quantity, quality and availability, in relation to its regulated activities.
The Group monitors capital on a daily basis by measuring movements in the Group regulatory capital requirement and through its
Internal Capital Adequacy and Risk Assessment Process (ICARA), which was formerly through its Internal Capital Adequacy
Assessment Process (ICAAP). Compliance with FCA minimum common equity tier 1 regulatory capital requirements was maintained
during the year and the Group is satisfied that there is and will be, sufficient capital to meet these regulatory requirements for the
foreseeable future.
29. Share capital and share premium account
As at 1 April 2020
Shares issued:
On placing
Balance at 31 March 2021
Shares issued:
On placing
Balance at 31 March 2022
Number of
shares
£'000
48,699
13,323
62,022
64
62,086
Share
capital
£'000
2,435
666
3,101
3
3,104
Share
premium
£'000
14,314
4,669
18,983
31
19,014
At 31 March 2022 the total number of issued ordinary shares is 62.09 million shares of 5p each (FY21: 62.02 million shares of 5p each).
0.06million shares were issued during the period (FY21: 13.32 million).
On 11 March 2021 a new NED scheme was announced which would issue ordinary shares to certain Non-Executive director’s in lieu
of 25% of the fees that would otherwise be due to them.
The following ordinary shares have been issued to Non-Executive directors under the NED scheme
Number of
shares
£'000
31,248
41,664
30,545
33,897
Nominal value
£'000
5p
5p
5p
5p
Amount paid
per share
£'000
48p
48p
58p
50.7p
30-Jul-20
16-Mar-21
30-Jul-21
11-Feb-22
On 27 November 2020 the Group issued 13,250,000 ordinary shares by way of placing at a price of 40p per share to support the
acquisition of Harpsden Wealth Management Limited.
86
Notes to the financial statements
30. Treasury shares
Group
At 31 March
Additions
At 31 March
Year ended 31 March 2022
£'000
644
256
900
Year ended 31 March 2021
£'000
644
-
644
At 31 March 2022 no shares in the Company were held in the EBT (FY21: nil shares) and the ESOT held 2,639,500 shares (FY21:
2,139,500), at a nominal value of 5p per share and represents the full balance above. This represents 4.25% of the called up share
capital (FY21: 3.45%).
During the year the Company’s Employee Share Option trust (ESOT) purchased the following ordinary shares in the Company
Date of issue
15-Jun-21
20-Jul-21
05-Aug-21
09-Sep-21
25-Oct-21
08-Nov-21
13-Dec-21
05-Jan-22
09-Feb-22
09-Mar-22
Number of
shares
£'000
50,000
50,000
40,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
Nominal value
Total consideration
£'000
5p
5p
5p
5p
5p
5p
5p
5p
5p
5p
£'000
28,250
29,000
22,800
29,000
27,430
25,500
25,000
23,500
22,750
22,750
31. Employee Benefit Trusts (EBT)
The WH Ireland EBT was established in October 1998 and the WH Ireland Group plc Employee Share Ownership Trust (ESOT) was
established in October 2011, both for the purpose of holding and distributing shares in the Company for the benefit of the
employees. All costs of the EBT and ESOT are borne by the Company or its subsidiary WH Ireland Limited.
Joint Ownership Arrangements (the ‘JOE Agreements’) are in place in relation to 400,000 shares between the trustees of the ESOT
and a number of employees (the ‘Employees’). Under the JOE Agreements, the option for the Employees to acquire the interest that
the trustees of the ESOT has in the jointly owned shares, lapses when an employee is deemed to be a Bad Leaver. If an Employee
ceases to be an employee of the Group, other than in the event of critical illness or death, the Employee is deemed to be a Bad
Leaver.
The shares carry dividend and voting rights though these have been waived by all parties to the JOE Agreements. Due to the
consolidation of the ESOT into the Group accounts, these shares are shown in Treasury (note 30). Due to the nature of these
arrangements, the options contained in the JOE Agreements are accounted for as share-based payments (note 32).
87
Notes to the financial statements
32. Share-based payments
The Group had two schemes for the granting of non-transferable options to employees during the reporting period; the approved
Company Share Ownership Plan (CSOP) and a Save as You Earn Schemes (SAYE). In addition, options are held in the ESOT (note 30).
Details of these schemes can be found in the Remuneration Report on pages 35 to 38. SAYE matures in July 2025.
Company Share Ownership Plan (CSOP)
Under the terms of the Unapproved Options, options over the Company’s shares may be granted on a discretionary basis to
employees and consultants of the Group (including Directors) at a price to be agreed between the Company and the relevant option
holder. Under the terms of the options granted, such options vest on the third anniversary of the award dates; are exercisable at the
market price at the time the option was issued and are exercisable for ten years after the vesting date.
Movements in the number of share options outstanding that were issued post 7 November 2002 and their related weighted average
exercise prices (WAEP) are as follows:
CSOP
ESOT
31 March 2022
ESOT
2019 LTIP
Options
WAEP
Options
WAEP Options
WAEP
Options
WAEP
2020 EMI Option Plan
WAEP
Options
127,002
64.69p
350,000
74.50p
50,000
92.50p
1,800,000
45.00p
4,330,719
40.43p
-
-
(91,500)
57.00p
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
387,929
25.78p
(1,074,478)
45.60p
-
-
35,502
84.50p
350,000
74.50p
50,000
92.50p
1,800,000
45.00p
3,644,170
37.34p
35,502
84.50p
350,000
74.50p
50,000
92.50p
-
-
-
-
0.08 yrs
1.50 yrs
4.01 yrs
8.03 yrs
10.26 yrs
Outstanding
at beginning
of year
Granted
Expired /
forfeited
Exercised
Outstanding
at end of
year
Exercisable
at end of
year
WA Life*
* WA Life represents the weighted average contractual life in years to the expiry date for options outstanding at the end of the year.
88
Notes to the financial statements
32. Share-based payments (continued)
31 March 2021
CSOP
ESOT
ESOT
Options
WAEP
Options
WAEP
Options
WAEP
Unapproved Options
WAEP
Options
2020 EMI Option Plan
Options
WAEP
142,002
63.88p
650,000
40.12p
70,000
92.50p
1,800,000
46.00p
-
-
-
-
-
-
-
(15,000)
57.00p
(300,000)
0.00p
(20,000)
92.50p
-
-
-
-
-
-
-
-
-
-
-
-
4,330,719
40.43p
-
-
-
-
127,002
64.69p
350,000
74.50p
50,000
92.50p
1,800,000
45.00p
4,330,719
40.43p
127,002
64.69p
350,000
74.50p
50,000
92.50p
-
45.00p
-
40.43p
0.73 yrs
2.5 yrs
5.01 yrs
9.03 yrs
12.46 yrs
Outstanding
at beginning
of year
Granted
Expired /
forfeited
Exercised
Outstanding
at end of
year
Exercisable
at end of
year
WA Life*
* WA Life represents the weighted average contractual life in years to the expiry date for options outstanding at the end of the year.
The pricing models used to value these options and their inputs are as follows:
Pricing Models
Pricing model
Date of grant
Share price at grant (p)
Exercise price (p)
Expected volatility (%)
Expected life (years)
Risk-free rate (%)
Expected dividend
yield (%)
CSOP
Black Scholes
ESOT
Monte Carlo
ESOT
N/A
02/11/11-
24/05/12
56.5-83.0
57.0-84.5
28/10/13-
13/4/16
74.5-114.5
0.0-114.5
32.6332-33.2130
5
1.2993-.0.7999
43.0000-37.0000
5
0.8000-1.9300
-
0.67-2.19
30/05/17
125
-
N/A
3
N/A
N/A
2019 LTIP
N/A
28/06/19 &
28/12/19
45.0 & 49.0
45.0 & 49.0
2020 EMI Option
Plan
N/A
01/11/20 -
01/09/21
42.0-56.5
0.0-58.0
50
3
2
N/A
50
1-3
5
N/A
33. Capital commitments
There were no capital commitments for the Group or the Company as at 31 March 2022 (FY21: £nil).
89
Notes to the financial statements
34. Related party transactions
Group
Services rendered to related parties were on the Group’s normal trading terms in an arms’ length transaction. Amounts outstanding
are unsecured and will be settled in accordance with normal credit terms. No guarantees have been given or received. No provision
(FY21: £nil) has been made for impaired receivables in respect of the amounts owed by related parties.
Key management personnel include Executive and Non-Executive Directors of WH Ireland Group plc and all its subsidiaries. They
are able to undertake transactions in stocks and shares in the ordinary course of the Group’s business, for their own account and
are charged for this service, as with any other client. The transactions are not material to the Group in the context of its operations,
but may result in cash balances on the Directors’ client accounts owing to or from the Group at any one point in time. The charges
made to these individuals and the cash balances owing from/due to them are disclosed in the table below. There are no other
material contracts between the Group and the Directors.
No transactions occurred with key management personnel and other relates parties during the year ended 31 March 2022 or 31
March 2021.
The total compensation of key management personnel is shown below:
Short-term employee benefits
Post-employment benefits
Termination benefits
Share-based payment
Year ended 31 March 2022
£'000
3,784
15
443
-
4,242
Year ended 31 March 2021
£'000
1,685
-
-
-
1,685
The highest paid Director for 2022 was P Wale receiving emoluments of £468,325 (FY21: £354,831).
Company
The Parent Company receives interest from subsidiaries in the normal course of business. Total interest received during the year
was £nil (FY21: £nil). In addition, the Parent Company received a management charge of £651k (FY21: £453k) from its subsidiary WH
Ireland Limited. WH Ireland Limited also charged the Parent Company £nil (FY21: £nil) for broker services.
During the comparative year, the intercompany balances with Stockholm Investments Limited and Readycount Limited were
converted into loans and then released through a deed of release.
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation. The
captions in the primary statements of the Parent Company include amounts attributable to subsidiaries. These amounts have been
disclosed in aggregate in the notes 17, 22 and 25 and in detail in the following table:
Amounts owed by related parties
Amounts owed to related parties
Readycount Limited
Stockholm Investments Limited
WH Ireland Limited
Harpsden Wealth Management
Limited
WH Ireland Trustee Limited
2022
£'000
2021
£'000
-
-
-
-
-
-
-
-
-
-
-
-
2022
£'000
-
-
1,882
295
17
2,194
The net amount owed to related parties is £2,194k (FY21: £2,824k owed by related parties) (see note 22 and 25).
2021
£'000
-
-
2,807
-
17
2,824
90
Company information
Directors
P A Wale
S N Lough
T Wood (appointed 20 September 2021)
H Sinclair (appointed 4 May 2021)
S J Jackson (appointed 14 February 2022)
P Tansey (resigned 31 December 2021)
P J Shelley (resigned 25 April 2022)
S Ford (resigned 31 January 2022)
A G Buchanan (resigned 30 September 2021)
V G Raffé (resigned 12 August 2021)
Auditors
RSM UK Audit LLP
25 Farringdon Street
London
EC4A 4AB
Bankers
Bank of Scotland plc
2nd Floor, 1 Lochrin Square 92-98 Fountainbridge
Edinburgh
EH3 9QA
Nominated Adviser
Canaccord Genuity Limited
88 Wood Street
London
EC2V 7QR
Joint Brokers
WH Ireland Limited
24 Martin Lane
London
EC4R 0DR
Canaccord Genuity Limited
88 Wood Street
London
EC2V 7QR
Handelsbanken plc
Anvil House Tuns Lane
Henley-on-Thames
RG9 1SA
Company Secretary
K L Mitchell
Registered Office
24 Martin Lane
London
EC4R 0DR
Company Number
03870190
91
A lifetime of advice.
T: +44 (0) 20 7220 1666
W: www.whirelandplc.com
E: enquiries@whirelandplc.com
WH Ireland is the trading name of WH Ireland Limited which is a wholly owned subsidiary of WH Ireland Group plc. WH Ireland
Limited is authorised and regulated in the UK by the Financial Conduct Authority, is registered in England & Wales with company
number 02002044 and is a member of the London Stock Exchange. VAT No. 727149034.