Strategic Report
Governance Report
Financial Statements
Company Financial Statements
Key audit matter
How our audit addressed the key audit matter
Accounting and disclosure of the disposal of BMI (group) The disposal of BMI has been disclosed within note 13 of the
We performed the following procedures in relation to the accounting and disclosure of the disposal of BMI: • We have assessed the gain on disposal of BMI disclosed within discontinued operations against the IFRS 5 criteria and we have performed substantive testing over the balances included in the discontinued operations line item; • We have assessed the amount recognised as consideration received against the disposal agreement for completeness; • We have assessed management’s revenue estimates against historical data and business trends; • We have assessed the reasonableness of the discount rate applied to the deferred consideration; • We have considered and challenged assumptions used by management, including growth rates and the impact of post purchase management action; • We have independently recalculated expected deferred consideration based on the results of the procedures performed above; • We have determined the reasonableness of management’s forecasted revenue estimate based on the results of the procedures performed above; and • We have assessed the disclosure of the critical estimate of revenue and the associated sensitivity analysis performed in the disclosure. We are satisfied that based on the work performed, the disposal has been accounted for appropriately with adequate disclosures made in the Annual Report and Accounts. We performed the following procedures in relation to whether indicators of impairment existed for the parent company’s investments in subsidiaries: • Obtained and evaluated management’s IAS 36 indicator assessment, challenging the completeness and basis of the indicators considered; • Comparing the carrying amount of each investment with the parent company’s share of the subsidiaries’ underlying net assets and recent trading performance; • Reviewed the forecast cash flows generated by the company’s subsidiaries as part of the impairment indicator assessment; and • We verified that the methodology used by the directors in arriving at the carrying value of each subsidiary was compliant with applicable accounting standards. Based on the audit procedures performed and evidence obtained, we did not identify any evidence of material misstatement in relation to management’s assessment of impairment indicators.
financial statements. In connection with the sale of the international business, which included Brooks Macdonald Asset Management (International) Limited and Brooks Macdonald International Fund Managers Limited, management have disclosed a discontinued operation, a gain at the group level and deferred consideration receivable. Given the heightened level of judgement involved and the additional disclosure requirements, there is an increased risk of material error. Accordingly, the item has been considered as a Key Audit Matter.
Impairment of Investment in Subsidiaries (parent) The parent company holds investments in subsidiaries of £110 million, as set out in note 46 to the company financial statements. Determining whether indicators of impairment exist in respect of these investments is a key audit matter due to the magnitude of the balance relative to the company’s net assets and judgement required under IAS 36 in assessing whether an impairment trigger has occurred we assessed this area as a key audit matter. Management evaluated a range of qualitative and quantitative factors in concluding whether any such indicators were present during the year.
Brooks Macdonald Group plc Annual Report and Accounts 2025
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