Annual Report & Accounts 
for the year ended 30 June 2013 Business performance 
Financial highlights 1
Group overview 2
Chairman’s statement 3
Chief Executive’s review 4-5
Business review 6-7
 
Governance 
Board committees’ report 8-15
Report of the directors 16-18
Statement of directors’ responsibilities 19
 
Consolidated financial statements 
Independent auditors’ report to the members of Brooks Macdonald Group plc 20
Consolidated statement of comprehensive income 21
Consolidated statement of financial position 22
Consolidated statement of changes in equity 23
Consolidated statement of cash flows 24
Notes to the consolidated financial statements 25-55
 
Company financial statements 
Independent auditors’ report to the members of Brooks Macdonald Group plc 56
Company balance sheet 57
Notes to the company financial statements 58-62
 
Shareholders’ information 
Explanation of Annual General Meeting business 63-66
Notice of Annual General Meeting 67-69
Form of proxy 71
 
Other information 
Directors and advisers IBC Annual Report & Accounts 2013
1
Brooks Macdonald Group plc
Financial highlights
Funds under management (£m) Earnings per share (p) Dividend per share (p)
2008 2008 2008 2009 2009 2009 2010 2010 2010 2011 2012 2013 2011 2012 2013 2011 2012 2013
2,186
38.10
9.0
2,969
3,520
5,110
51.92
57.43
65.76
15.0
18.5
22.5
1,386 22.56
5.5
1,181
12.41
3.5
Discretionary funds under 
management increased from 
£3.52 billion to £5.11 billion 
during the year
Adjusted pre-tax profit
†
 for the 
year was £11.4 million compared 
to £8.5 million in 2012
Adjusted basic earnings per share
†
 
increased from 57.43p to 74.33p
Pre-tax profit for the year was 
£10.4 million compared to £8.5 
million in 2012
Basic earnings per share increased 
from 57.43p to 65.76p
Total dividends per share 
increased from 18.5p to 22.5p, 
including a proposed final 
dividend of 16.0p per share
+45%
+22%
+15%
+22%
+34%
+29%
† Excludes the transactional costs of acquiring subsidiary companies of £1,047,000 (2012: £nil) Annual Report & Accounts 2013 Brooks Macdonald Group plc
2
Brooks Macdonald Group  
plc (‘the Group’) is an AIM  
listed, integrated wealth 
management group.
The Group consists of six 
principal companies:
Brooks Macdonald Asset Management 
Limited provides a bespoke, fee based, 
discretionary investment management 
service to private high net worth individuals, 
charities and trusts. It also provides in-house 
custody, nominee and dealing services and 
has offices in London, Manchester, 
Hampshire, Tunbridge Wells, Edinburgh, 
Taunton, York and, opening in September, 
Leamington Spa.
Brooks Macdonald Funds Limited is based in 
Hale and acts as fund manager to our 
regulated OEICs as well as managing 
specialist funds in the property and 
structured return sectors.
Brooks Macdonald Financial Consulting 
Limited is a London based financial advisory 
and employee benefits consultancy providing 
fee based, independent advice to high net 
worth individuals, families and businesses.
Brooks Macdonald Asset Management 
(International) Limited and Brooks 
Macdonald Retirement Services 
(International) Limited are based in Jersey 
and Guernsey and offer discretionary 
portfolio management, advisory and 
stockbroking services as well as retirement 
planning advice. These two companies, 
previously named Spearpoint Limited and 
Spearpoint Retirement Services Limited 
respectively, were acquired during the year, 
as further detailed in note 9.
Braemar Estates Limited is an estate 
management company based in Hale that 
manages property assets on behalf of  
Brooks Macdonald Funds and other clients.
Group overview
2 Mount Ephraim Road  Tunbridge Wells   
Kent  TN1 1EE
Tunbridge Wells
110 and 111 Park Street  Mayfair  London   
W1K 7JL
London
The Long Barn  Dean Estate  Wickham Road  
Fareham  Hampshire  PO17 5BN
Hampshire
10 Melville Crescent  Edinburgh  EH3 7LU 
Edinburgh
1 Marsden Street  Manchester  M2 1HW
Manchester
Richmond House  Heath Road Hale  
Cheshire  WA14 2XP
Hale
Blackbrook Gate  Blackbrook Park Avenue   
Taunton  Somerset  TA1 2PX
Taunton
Howard House  3 St Mary’s Court   
Blossom Street  York  YO24 1AH
York
Liberation House  Castle Street  St. Helier   
Jersey  JE2 3AT
Jersey
Yorkshire House  Le Truchot  St. Peter Port   
Guernsey  GY1 1WD 
Guernsey
36 Hamilton Terrace  Holly Walk   
Leamington Spa  Warwickshire  CV32 4LY 
Leamington Spa
John Stow House  18 Bevis Marks  London   
EC3A 7JB
London
The Brooks Macdonald Group has developed 
under stable management since formation in 
1991 and now has in excess of 370 staff 
throughout the UK and Channel Islands. The 
Group’s shares are listed on AIM, with 
management and staff retaining considerable 
ownership of the business. Annual Report & Accounts 2013
3
Brooks Macdonald Group plc
This has been another year of 
considerable progress for the Group. 
Profit before tax has increased by 22% 
from £8.52m to £10.40m, and earnings 
per share by 15% from 57.43p to 65.76p. 
This is after charging £1.0m of costs 
incurred in the acquisition of Spearpoint, 
the Channel Islands fund management 
business now renamed Brooks Macdonald 
International.
The Board is recommending a final 
dividend of 16p per share which, if 
approved by shareholders, will result in 
total dividends for the year of 22.5p. This 
represents an increase of 22% over last 
year’s total dividends of 18.5p per share. 
The final dividend will be paid on 18 
October 2013 to shareholders who are on 
the register at the close of business on  
20 September 2013.
Spearpoint became part of the Group in 
November 2012, our first venture outside 
the UK, which will be the focus of what we 
hope will be a significant offshore business. 
We now have offices in Jersey and 
Guernsey, with two businesses: Asset 
Management and Retirement Services. The 
acquisition was in part funded by a 
successful share placing with institutional 
investors raising over £21m, the first fund 
raising by the Group since our shares were 
admitted to AIM in 2005.
Our discretionary funds under management 
had a strong year and as at 30 June 2013 
totalled £5.11bn (2012: £3.52bn), a rise of 
45% over the 12 month period. Net of the 
Spearpoint acquisition, this represents an 
increase of 25.6%, compared to growth of 
9.8% in the APCIMS Balanced Index over 
the same period.
Property assets under administration grew 
to £1.04bn, an increase of 20% (2012: 
£865m) and third party assets under 
administration are now in excess of £140m 
(2012: £50m). In addition, as a result of 
the acquisition of Spearpoint, we had 
advisory funds under management of 
£348m at the year end.
In addition to these acquisitions the Group 
has continued to grow organically and 
invest for the future. The number of 
professional introducers using our asset 
managers continues to rise, we have 
recruited quality new fund managers and 
consultants and we continue to invest in 
our trainee programme, investment 
management process and IT systems.
The last year has been a year of 
considerable progress but also of change. 
The introduction of the Retail Distribution 
Review in January, something that we 
supported, has led to changes across the 
whole industry and to continued rises in 
regulatory costs. Together with a re-pricing 
of our Managed Portfolio Service (MPS) 
and with the investments highlighted 
above, as we indicated in July this year, this 
will lead to an adverse effect on our 
margins in the new financial year.
In spite of these changes we remain 
focussed on maintaining performance 
levels for our clients, our staff and our 
shareholders and are pleased with the 
significant progress achieved by the Group 
over the last financial year and look forward 
to the future with confidence.
Christopher Knight 
Chairman
10 September 2013
“We remain focussed on 
maintaining performance 
levels for our clients, our 
staff and our shareholders 
and are pleased with 
the significant progress 
achieved by the Group 
over the last financial year” 
Chairman’s statement
Christopher Knight, Chairman Annual Report & Accounts 2013 Brooks Macdonald Group plc
4
Chief Executive’s review
Introduction
This has been a year of considerable 
expansion for the Group against a backdrop 
of significant regulatory changes and our 
success over the last year has only been 
possible with the continued hard work and 
professionalism of all our staff, together with 
the support of our professional introducers 
and shareholders. I would like to thank all 
parties for their significant contributions to 
these results.
I am pleased to report that we have seen 
growth across all of our existing 
businesses (Asset Management, Financial 
Consulting, Property Management, 
Investment Services and Funds) over the 
course of the financial year.
Funds under management 
Our discretionary funds under management 
went through a significant landmark in the 
year going through £5bn. As at 30 June 
2013 this had risen to £5.11bn, a rise of 
45% over the twelve month period 
supported by rising investment markets and 
the acquisition of Spearpoint. Stripping out 
market growth and the acquisition this 
amounted to organic growth at over 15% 
over the year. A large proportion of our new 
business is introduced by professional 
intermediaries and we remain firmly 
committed to maintaining this strategy.
We have three principal offerings: our 
Bespoke Portfolio Service (BPS) for high net 
worth individuals (whether this be private 
portfolios, Self Invested Personal Pensions or 
Trusts); Managed Portfolio Service (MPS), 
which caters for smaller portfolios on a 
modular basis; and our funds business, which 
offers units in a number of funds. The 
dynamics behind all three services are 
becoming increasingly different in part due 
to the Retail Distribution Review (RDR) but 
also due to significant changes in the 
distribution landscape. BPS has not changed 
in that we offer a complete investment 
management service to high net worth 
clients including custody of assets. Whilst the 
popularity of MPS continues, custody and 
the use of platforms have altered the pricing 
of the service and to this end we have 
reacted to the changes in the industry and 
rebased our fees for this service. 
In our funds business we continue to offer 
highly niche funds or unitised versions of our 
MPS range of risk rated portfolios, and this 
continues to gain momentum with £390m 
(£329m net of the acquisition) under 
management at the year end, growing from 
£148m at the end of June 2012.
Strategies for growth 
Our expansion has always revolved around 
organic growth, ongoing investment in the 
business and both service and performance 
development. 
This past year has been no different in that we 
completed two acquisitions, the first in July 
2012 when we acquired JPAM Limited - a long 
term introducer - and the second in 
November 2012 when we acquired 
Spearpoint. The latter comprised two 
businesses: Investment Management and 
Retirement Services. It was a substantial step 
forward for the Group giving us the 
opportunity to expand our ‘footprint’ outside 
the UK. The first seven months since 
acquisition have been focused around 
integrating the business into the wider group. 
Going forward our collective aim is to grow 
the business around BPS, advisory services, 
retirement advice and later this year the 
“This has been a year of 
considerable expansion 
for the Group against a 
backdrop of significant 
regulatory changes”
“We continue to invest in 
service and performance 
development”
Chris Macdonald, Chief Executive Annual Report & Accounts 2013
5
Brooks Macdonald Group plc
Chief Executive’s review
launch of an offshore MPS offering. The 
acquisition and integration has been 
successful and has taken a lot of hard work 
from all parties but I would like to thank the 
staff of Spearpoint for their considerable 
endeavours in making this possible.
Our organic growth has been strong across 
the Group. This growth continues to be 
supported by professional intermediaries and 
more recently by a number of institutional 
investors that have backed our new fund 
launches. We now have over 540 firms 
introducing work to the firm from across the 
UK. This is supported by all our regional 
offices and is something we wish to repeat 
offshore through our offices in Jersey and 
Guernsey. Our largest office remains our 
headquarters in London but we now have 
bases in Hampshire, Manchester, Tunbridge 
Wells, Edinburgh, Hale (where our property 
management business, Braemar Estates, is 
based), Taunton, York, Jersey and Guernsey. 
We will be opening an office in the Midlands 
(in Leamington Spa) in mid September, thus 
ensuring that we can support professional 
intermediaries and clients alike in every region 
in the UK.
Our staff numbers have increased over the 
year from 282 to 376. We have recruited at 
all levels across the Group including senior 
management (for example Chris March 
being appointed as CEO of our Estates 
business), further trainees (in Funds, Asset 
Management and Financial Consulting) and 
in central services. Whilst we continue to 
grow it is imperative we both build for 
future capacity but also retain the very 
strong culture of the business.
We continue to invest in service and 
performance development. This ranges from 
‘central’ infrastructure spending (upgrading 
of our existing IT to hosting our data in 
third party data centres and web 
development), the re-papering of all our 
clients with the recent developments 
around suitability of advice and further 
resources in investment research and 
monitoring. In the last example I am 
pleased that we have continued to perform 
well for our clients providing strong 
risk-adjusted returns. 
The growth of SIPPs continues and this is now 
further supported by legislative change 
around auto enrolment. We will be looking to 
launch a specific auto enrolment service later 
this year utilising our own funds and this will 
apply both on and offshore. This is an 
opportunity we are increasingly excited about.
Our brand development has also continued to 
gain traction. Over the last three years we 
have focussed most of our endeavours on the 
professional intermediary market. We will 
certainly continue this whilst also focusing on 
increasing our brand recognition with our 
underlying clients. I am also pleased that once 
again we featured in the Sunday Times 100 
Best Companies to work for, were awarded 
five star ratings from Defaqto for both MPS 
and BPS and were also awarded Private Client 
Investment Manager of the year (AQC) and 
the Best Wealth Management Firm UK 
(Wealth Advisor Awards).
Regulation
On 1 January 2013 RDR came into force. 
This was a substantial change to the whole 
of the financial services industry with a focus 
on transparency of charging, greater 
consumer clarity and the raising of 
professional standards and corporate 
stability. These are changes that we fully 
support but the costs associated with 
increased regulation have become and 
remain substantial. Whilst we feel that these 
costs have peaked in terms of percentage of 
turnover, they have not been passed on to 
clients. This is something that we and, we 
believe, the whole of the industry will have 
to consider over the coming years.
Summary and outlook 
I will repeat the comments I made in my 
review in 2012, that the last year was a 
tough one. Investment markets were 
supportive but the quantum of change, 
particularly in the distribution of financial 
services and regulation, meant that the 
business had to be highly dynamic. I am 
pleased that against this backdrop the 
Group made substantial progress. 
For the coming year our outlook for 
investment returns remains cautiously 
optimistic. We believe that there will be a 
more stable background for regulatory 
change, that there will continue to be margin 
pressures on non-bespoke services and that 
there will be numerous opportunities for the 
Group. Despite the short term margin 
pressures we have flagged, we are a 
progressive business and therefore will 
continue to invest for the future.
I am pleased to report further organic 
growth in funds under management in the 
early months of the new financial year. The 
Board remains confident for the future 
prospects of the Group.
Chris Macdonald 
Chief Executive
10 September 2013 Annual Report & Accounts 2013 Brooks Macdonald Group plc
6
Group overview 
The Group has had a strong year of growth, audited pre-tax profits 
increasing by 22% in the year to £10.4m and basic earnings per 
share increasing from 57.43p per share last year to 65.76p for the 
year ended 30 June 2013.
The Group has no borrowings and at 30 June 2013 its cash balances 
totalled £18.4m. The detailed movement in group cash balances is 
shown in the consolidated statement of cash flows. 
Investment management
The investment management division principally provides 
discretionary investment management services to private investors, 
charities and trusts. Despite difficult economic and investment 
conditions during the financial year the division has continued to 
grow funds under management both organically and through the 
acquisition of Spearpoint Limited in November 2012.
 Funds under management (£m)
At 1 July 2012 3,520
Inflows  – net new discretionary business* 574
 – acquired through Spearpoint Limited 650
  – market movement 366
At 30 June 2013 5,110
Underlying rate of total net growth 45.17%
*Clients leaving and capital or income withdrawals of larger than £50,000 for
Bespoke Portfolio Service and larger than £20,000 for Managed Portfolio Service
The underlying rate of growth of 45% of funds compares to an 
increase in the APCIMS Balanced Index of 10% and an increase in the 
FTSE 100 index of 12% over the same period and represents a 
continued growth in funds under management (FUM) over the last 
five years as illustrated below.
The financial performance of the division is driven mainly by the 
total funds under management and the net growth in new funds 
achieved over the year. 
For the first six months of the year, fee income includes the share of 
fees paid to introducers and their payments are shown within the 
administrative expenses of the division. Following the introduction of 
the Retail Distribution Review (RDR) on 1 January 2013 there has 
been a change in the reporting of the fee income and the 
corresponding share of the fee due to the third party introducer, if 
applicable. Under RDR any payment due to the introducer is payable 
on the instruction of the client from their client bank account and the 
Group will simply become a facilitator for these payments. They will 
no longer form part of the administrative costs of the division and 
there will be a corresponding reduction in fee income. 
The impact of RDR on fee income and administrative costs for the 
division as described above has only impacted on the second half of 
the financial year ended 30 June 2013 and has not affected 
arrangements with all introducers. Some introducers have made the 
decision to retain an ‘old book’ of business whereby the fee charged 
by the division continues to include the share of the fee payable to 
the introducer, with the corresponding payment included within the 
administrative expenses of the division. The impact of this change to 
RDR on the results of the division is a reduction of approximately 
£5.9m of income with a matched reduction in administrative costs.
There has been continued development and investment in our back 
office functions in order to increase the efficiency and to further 
enhance the overall service both to our own clients and to those 
using our third party administration services.
Business review
FUM (£m)
6,000
5,000
4,000
3,000
2,000
1,000
0
Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Annual Report & Accounts 2013
7
Brooks Macdonald Group plc
On 19 November 2012 we completed the acquisition of Spearpoint 
Limited (now renamed Brooks Macdonald Asset Management 
(International) Limited (BMI)) together with Spearpoint Retirement 
Services Limited (now renamed Brooks Macdonald Retirement 
Services (International) Limited (BMRS)) for an initial consideration 
of £22.5m (excluding the value of net assets acquired) with an 
additional projected deferred payment of £4.3m due in November 
2014. BMI is a Jersey and Guernsey based integrated wealth 
management company and in addition to the discretionary funds of 
£650m shown above, BMI also had advisory funds of £450m and 
offers execution only and foreign exchange services to its clients. 
The acquisition of BMI has added further scale and a significantly 
enhanced offshore capability for our clients. Further details of 
the acquisition are disclosed in note 9 to the consolidated 
financial statements.
Brooks Macdonald Funds and Braemar Estates
It has been a year of considerable growth for Brooks Macdonald 
Funds with total funds under management increasing significantly 
from £148m to £390m at 30 June 2013 following a rise of 46% in 
the previous year to 30 June 2012. This growth was achieved both 
organically through new investment in the existing seven funds as 
well as by the acquisition of BMI which added a total £65m in a 
further five funds through an offshore Dublin OEIC.
Braemar Estates has continued its growth in the property 
management sector with the value of assets under administration 
breaking through £1bn during the year to £1.04bn at 30 June 
2013, an increase of over 20% in the year.
Financial Consulting
The financial consulting division has had another good year with 
increased revenue and profits and it particularly benefited from 
having a business model which required little or no change with the 
advent of RDR from 1 January 2013. The division continues to 
deliver both fee based financial planning to high net worth 
individuals and employee benefits consultancy to small and medium 
sized employers throughout the UK.
The division is starting to work with BMRS in Jersey and Guernsey, 
which was acquired in conjunction with BMI as described earlier 
and it is also benefitting from the expansion in the existing group 
office network, with the provision of employee benefits being a 
particular growth area due to the requirements of auto enrolment 
for all UK employers. 
Business review Annual Report & Accounts 2013 Brooks Macdonald Group plc
8
Board committees’ report
The principal board committees are the Audit, Remuneration and 
Risk and Compliance committees, all of which have specific terms of 
reference which are periodically reviewed and approved by the 
Board. These terms of reference are available on the Group website.
Audit Committee
The members of the Audit Committee are two of the non-executive 
directors Christopher Knight (Chairman) and Colin Harris. The 
Board is satisfied that both members have recent and relevant 
financial experience.
The Committee met twice during the year ended 30 June 2013. As 
well as being responsible for reviewing the external audit 
arrangements with regard to compensation, scope and period of 
office, the Committee also considers the accounting policies of the 
Group and the significant issues and judgements in connection with 
regulatory financial reporting.
The Committee reviews the audit control memorandum and the 
audit engagement letters and has discussions with the auditor 
without management present.
Risk and Compliance Committee
The Board believes the best way to manage risk across the Group is 
to embed the risk management process throughout the 
organisation and we endeavour to ensure that all identified risks are 
owned by specific committees who in turn report to the Risk and 
Compliance Committee.
The members of the Risk and Compliance Committee are the 
non-executive directors Colin Harris (Chairman), Christopher Knight 
and Diane Seymour-Williams. The meetings of the Committee are 
also attended by Christopher Macdonald, Simon Jackson, Simon 
Wombwell, Nick Holmes, Nicholas Lawes, Andrew Banks (Head of 
Risk and Compliance), Meera Varsani, who was appointed during 
the year as Group Risk Manager, and other senior members of the 
Risk and Compliance department.
During the year ended 30 June 2013 the Committee met on six 
occasions. Its principal responsibilities include overseeing the 
current risk exposures of the Group, reviewing the risk assessment 
processes, assessing material breaches of risk limits and the 
adequacy of the proposed management action and reviewing 
client complaints.
The risk management framework is broadly the same as for the 
previous year. The principal risks assessed by management as having 
a potential material impact on the Group are detailed below 
together with the principal means in which these risks are mitigated.
Financial risks
The Group’s principal financial risks relate to credit risk, liquidity risk 
and market risk and the measures and policies for the management of 
those risks are set out in note 28 to the consolidated financial 
statements. Further details on capital management processes can be 
found in note 29. Annual Report & Accounts 2013
9
Brooks Macdonald Group plc
Board committees’ report
Mitigation
This risk is minimised by ensuring the Group maintains a culture of 
high ethical and professional standards whilst focussing on delivering 
a first class service to all of our clients. The Group maintains an 
independent Risk and Compliance department which ensures 
conformity with the regulations of the Financial Conduct Authority,  
as well as relevant statutes, in all of our dealings with our clients.
Mitigation
The Group monitors compliance with existing regulations and any 
impending changes in regulations in order to assess the impact on 
the business and to ensure that the Group has sufficient resources to 
implement any necessary changes.
Mitigation
To minimise this risk, the Group continues to invest in its employees 
and monitors developments in the marketplace in which it operates 
to ensure that the Group continues to offer a wide range of services. 
Recruitment policies are designed to attract high quality staff and 
the Group regularly reviews and benchmarks its remuneration 
packages and contractual arrangements in order to retain and 
motivate staff. The Learning & Development team, as part of 
Human Resources, provides structured training plans in order to 
ensure all staff continue to develop their careers within the Group.
Mitigation
New IT projects are regularly reviewed and appraised at Board 
meetings in order to ensure that the Group continues to develop its 
IT capabilities. As well as our regional offices providing back up 
facilities for our London head office, we have a fully tested disaster 
recovery plan which would facilitate remote working capabilities.
Impact
The Group has a growing reputation as a provider of high quality 
investment and wealth management services. There is a risk that 
significant damage to reputation could lead to the loss of existing 
clients as well as impacting on the ability to gain new clients, which 
would lead to a fall in financial income. Such risk could arise from 
events such as poor investment performance, poor client service or 
regulatory censure.
Impact
The sector in which the Group operates is heavily regulated and any 
breach of regulations could lead to fines or disciplinary action 
against the Group or its staff.
Impact
Our business is dependent on client relationships with our staff. 
As the Group operates in a competitive market, there is a risk of 
loss of existing clients due to poor performance or service, a 
failure to respond to changes in the marketplace, or the loss of 
key investment professionals.
Impact
A key part of the high quality service delivered to clients is 
facilitated by a flexible and robust internal IT infrastructure.
Risk and Compliance Committee (continued) 
Non–financial risks
The significant non-financial risks faced by the Group are as follows:
Reputational risk
Regulatory risk
People risk
Technology risk Annual Report & Accounts 2013 Brooks Macdonald Group plc
10
Mitigation
Management continuously monitors and reviews the internal 
controls in place. Due diligence takes place prior to the 
commencement of any outsourcing or supply, to maintain a robust 
procurement process, good contract governance and regular 
assessment of performance against pre-agreed service levels.
Mitigation
Portfolio performance, valuations and risk profiles are monitored by 
management, allowing issues to be identified and mitigated as they 
arise. The Group has in place BITA Monitor portfolio risk oversight 
tools to assist with supervising portfolio management. The Group is in 
the process of a re-papering exercise, writing to all clients in order to 
agree the suitability of the individual portfolios.
Impact
Operational risk is the risk that the Group suffers a loss of 
business resulting from inadequate or failed internal processes, 
people and systems or from the failure of outsourcing partners 
or external suppliers.
Impact
There is a risk that portfolios will not meet their investment 
objectives, which could result in the Group suffering loss of 
business. There is a risk on the suitability of portfolios for clients 
and where the suitability responsibility lies between a professional 
introducing the client and the group company.
Risk and Compliance Committee (continued) 
Investment performance risk
Operational risk
Remuneration Committee 
The Remuneration Committee comprises Diane Seymour-Williams (Chairman), Christopher Knight and Colin Harris. The Committee 
determines the specific remuneration packages for each executive director and certain senior executives.
Remuneration policy 
Brooks Macdonald recognises the importance of its employees to the success of the Group and consequently the remuneration policy is 
designed to be market competitive in order to motivate, aid staff retention and recruitment and align employee behaviour with the 
interests of shareholders. External third party data is used to validate rather than to benchmark the total reward.
The remuneration policy, which applies to directors and employees of the Group, is based on the following key principles:
• alignment to effective risk management;
• the need to provide market competitive total compensation;
• differentiation by merit and performance;
• an emphasis on variable, performance driven remuneration to bonus payments funded from retained profits;
• consistency with the FCA Remuneration Code;
• alignment with shareholders’ interests through significant and widespread equity ownership; and 
• clarity, transparency and fairness of process.
The current remuneration package for an executive director has four main elements: basic salary and benefits, profit related bonus, long-term 
equity based incentives and pension. The total reward is designed to include a balance of fixed and variable pay with a high level of deferral.
The elements of remuneration packages are summarised overleaf.
Board committees’ report Annual Report & Accounts 2013
11
Brooks Macdonald Group plc
Board committees’ report
Remuneration Committee (continued)
Directors’ remuneration
 Salary Profit related Profit related Benefits Total Total Phantom Phantom Pension Pension
 or fee bonus -  bonus -   2013 2012 Share Share contributions contributions
  cash deferred    Scheme Scheme 2013 2012
   shares    2013 2012 
 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Chairman       
C J Knight 60 - - - 60 60 - - - -
Executives       
C A J Macdonald 247 266 64 4 581 554 - 270 - 32
N I Holmes 162 148 37 2 349 360 - 541 24 24
S J Jackson 162 148 37 3 350 350 - 541 24 32
A W Shepherd 162 129 56 2 349 350 - 541 24 24
R H Spencer 183 128 32 3 346 329 - 270 - 24
S P Wombwell 189 148 37 3 377 301 - - - 24
J M Gumpel* 56 39 10 1 106 326 - 270 - 24
N H Lawes* 49 22 5 1 77 240 - 541 7 24
Non-executives       
C R Harris 38 - - - 38 38 - - - - 
D Seymour-Williams 35 - - - 35 28 - - - -
Total 1,343 1,028 278 19 2,668 2,936 - 2,974 79 208
*Resigned 19 October 2012
Basic salary and benefits 
Basic salary is determined by the Committee and any changes are implemented from 1 July each year or when an individual changes 
position or responsibility. In deciding appropriate levels the Committee considers salaries throughout the Group and information on 
comparable companies provided by advisers to the Committee. The views of the Chairman and Chief Executive are taken into consideration 
when setting the salary of other directors. 
There were no salary increases for the executive directors with effect from 1 July 2013 against an overall average increase for all employees of 
3.6%. The non-executive directors’ salaries were reviewed and increased on average by 13.5% with the approval of the Board to reflect their 
additional responsibilities and commitments as the Group grows. In addition, the Group provides a range of benefits including private medical, 
life and permanent health insurance as well as interest free season ticket loans as disclosed in note 31 to the consolidated financial statements.
Profit related bonus
Awards to executive directors of profit related bonuses are made from a pool of profits of 15-25% of the Group pre-tax profit after the 
payment of all bonuses to all other staff. The Committee determines the size of the pool based on the performance of the Group against a 
number of key performance indicators including the growth in profits, the movement in funds under management, various internal client 
service metrics and the performance against budget of each of the operating divisions. The total payment to executive directors, including 
the amounts deferred into shares and the total payments to directors who only served for part of the financial year, represented 12.4% 
(2012: 14.7%) of Group pre-tax profit. Annual Report & Accounts 2013 Brooks Macdonald Group plc
12
Board committees’ report
Remuneration Committee (continued) 
Profit related bonus (continued)
Awards to individual directors are determined by the Remuneration Committee following recommendations by the Chief Executive taking 
into account the performance of the director, the results of the business where the director has responsibility (where relevant) and market 
data where this is available. The Remuneration Committee has decided that 20% of the bonus awarded will be made in shares deferred for 
a period of three years under a Long Term Incentive Scheme (LTIS). In addition, directors may choose to defer a further amount of any 
bonus awarded, up to a maximum of 20%, making 40% in total, into shares under the LTIS. The scheme has performance conditions 
attached to the deferred award, requiring a minimum growth in the diluted earnings per share of the Group of 2% per annum above the 
increase in the Retail Price Index (RPI) over the three year period.
Phantom Share Scheme
The Brooks Macdonald Group Phantom Share Scheme was adopted by the Board on 15 October 2008 with the intention of creating an 
incentive plan for senior key directors and employees of the Group.
The scheme was a cash settled scheme based on the increase in the ordinary share price of the Company. The award could be exercised if 
there was compound annual growth of at least 20% in earnings per share of the Company over a three year performance period from 1 July 
2008 to 30 June 2011 and the amount was payable in October 2011.
In July 2011 the Board decided to amend the rules of the scheme, in agreement with the members, whereby the share price used in the 
calculation of the cash payment on the exercise of the option would be fixed at £13.00 with an initial payment of £12.35 in October 2011 
and a further payment of 65p in October 2012 in respect of each option granted.
The comparative amounts shown within the table on page 11 for directors’ remuneration for the year ended 30 June 2012 represent the 
total amount which was paid in both instalments.
Equity incentives  
Long Term Incentive Scheme (LTIS) and Employee Benefit Trust (EBT)
The Group established an EBT on 3 December 2010. The trust was established to acquire ordinary shares in the Company in connection 
with the deferred share element of the profit share bonus under the LTIS as detailed above. The EBT is also used for other long term awards 
to members of the Board and other long term awards to other senior employees.
The Remuneration Committee has made additional awards under the LTIS to certain executive directors and other senior employees. The 
conditional awards are subject to the same performance and other conditions as those applying to the deferred profit related bonus shares.
Details of the awards granted to the directors of the Company under the terms of the LTIS during the year ended 30 June 2013, in respect 
of the deferred element of the profit related bonus for the previous year together with any additional awards, are detailed below. The 
market value of the Company’s shares at the date the awards were made, 25 October 2012, was £12.70. Annual Report & Accounts 2013
13
Brooks Macdonald Group plc
Board committees’ report
Remuneration Committee (continued) 
Equity incentives (continued)
 At  Profit related bonus -  Additional awards At  Earliest 
 30 June deferred shares under terms of LTIS 30 June exercise 
 2012 2013   2013 2013* date
C A J Macdonald 4,112 - - 4,112 27.10.13
 6,536 - - 6,536 20.10.14
 - 5,354 - 5,354 25.10.15
N I Holmes 2,095 - - 2,095 27.10.13
 9,886 - - 9,886 20.10.14
 - 3,149 1,575 4,724 25.10.15
S J Jackson 2,715 - - 2,715 27.10.13
 3,596 - - 3,595 20.10.14
 - 2,992 1,575 4,567 25.10.15
A W Shepherd 2,095 - - 2,095 27.10.13
 9,804 - - 9,804 20.10.14
 - 2,992 1,575 4,567 25.10.15
R H Spencer 2,405 - - 2,405 27.10.13
 3,105 - - 3,105 20.10.14
 - 2,677 - 2,677 25.10.15
S P Wombwell 11,847 - - 11,847 20.10.14
 - 2,205 1,575 3,780 25.10.15
J M Gumpel* 1,862 - - 1,862 27.10.13
 2,941 - - 2,941 20.10.14
N H Lawes* 1,474 - - 1,474 27.10.13
 1,634 - - 1,634 20.10.14
*Or at date of resignation
During the year none of the directors exercised any shares under the LTIS (2012: none). The LTIS options have a £nil exercise price and no expiry date.
Sharesave Scheme
All directors are entitled to take part in the HMRC-approved Brooks Macdonald Group Sharesave Scheme on the same terms as all other 
employees. Option grants were made on 1 June 2011 and 1 June 2013 for new three year fixed-term contracts and the details of the grants 
to directors are shown below:
 At 30 June  Awarded Exercised At 30 June Exercise Earliest Expiry 
 2012 in the year in the year 2013* price exercise date date
C A J Macdonald 985 - - 985 916p 01.06.14 30.11.14
N I Holmes 985 - - 985 916p 01.06.14 30.11.14
S J Jackson 985 - - 985 916p 01.06.14 30.11.14
A W Shepherd - 767 - 767 1,172p 01.06.16 30.11.16
R H Spencer 985 - - 985 916p 01.06.14 30.11.14
S P Wombwell 985 - - 985 916p 01.06.14 30.11.14
J M Gumpel* 985 - - 985 916p 01.06.14 30.11.14
N H Lawes* 985 - - 985 916p 01.06.14 30.11.14
*Or at date of resignation
Given the nature of the scheme as a three year fixed-term contract, there were no options exercised and there were no realised gains during 
the year (2012: £nil). Annual Report & Accounts 2013 Brooks Macdonald Group plc
14
Remuneration Committee (continued)
Equity incentives (continued)
Enterprise Management Incentive Scheme (EMI) 
The Brooks Macdonald Group EMI Scheme was adopted by the shareholders of the Company on 11 February 2005. 
Options granted can be exercised if there has been an increase in the diluted earnings per share of the Company of at least 2% per annum 
more than the increase in the RPI over the period of three financial years starting with the financial year in which the date of grant falls and 
ending with the financial year in which the third anniversary of the date of grant falls.
Options may not normally be exercised before the third anniversary of the date of the grant and expire on the tenth anniversary of the grant.
The details of the grants under the scheme to directors are shown below: 
 
 At 30 June  Awarded Exercised At 30 June Exercise Earliest Expiry 
 2012 in the year in the year 2013* price exercise date date
C A J Macdonald 17,500 - (17,500) - 290.5p 17.10.10 31.10.17
N I Holmes 15,000 - - 15,000 155.5p 01.11.08 01.11.15
 4,500 - - 4,500 215.0p 18.10.09 17.10.16
 6,000 - - 6,000 290.5p 17.10.10 31.10.17
S J Jackson 17,000 - - 17,000 215.0p 18.10.09 17.10.16
 12,500 - - 12,500 290.5p 17.10.10 31.10.17
R H Spencer 12,500 - (12,500) - 290.5p 17.10.10 31.10.17
J M Gumpel* 10,000 - - 10,000 155.5p 01.11.08 01.11.15
 12,500 - - 12,500 290.5p 17.10.10 31.10.17
N H Lawes* 12,500 - - 12,500 290.5p 17.10.10 31.10.17
*Or at date of resignation
The aggregate gain during the year from the exercise of the above EMI share options was £301,000 (2012: £326,000). The Company’s 
share price at the exercise date was £12.905 (2012: range of £12.33 to £13.25).
A W Shepherd held no EMI share options at either the beginning or the end of the year.
C R Harris, C J Knight, S P Wombwell and D Seymour-Williams held no EMI share options or Phantom Share Scheme awards at either the 
beginning or the end of the year or at the date of their appointment. 
Under the rules of the scheme, C R Harris, C J Knight and D Seymour-Williams were not eligible to participate in the Sharesave Scheme and 
therefore held no options at either the beginning or the end of the year or at the date of their appointment.
The average share price during the year was £13.27 (2012: £11.99). Details of the share option schemes are provided in note 19 and note 
24 to the consolidated financial statements. The market price at the end of the year was £14.35 (2012: £11.50) and the highest and lowest 
price during the year was £14.96 (2012: £13.65) and £11.35 (2012: £9.28) respectively.
Company Share Option Plan (CSOP)
Following discussions regarding remuneration structures and incentives schemes for senior employees and directors the Company has 
decided to set up a CSOP, subject to approval from HMRC and by shareholders at the forthcoming Annual General Meeting. 
Board committees’ report Annual Report & Accounts 2013
15
Brooks Macdonald Group plc
Remuneration Committee (continued)
Equity incentives (continued)
Company Share Option Plan (CSOP) (continued)
The proposed scheme is a discretionary scheme whereby employees or directors are granted an option to purchase the Company’s shares in 
the future at a price set on the date of the grant. The maximum award under the terms of the scheme is a total market value of £30,000. 
There will be performance conditions attaching to the scheme similar to those in place for the EMI Scheme whereby there must be an 
increase in the diluted earnings per share of the Company of 2% more than the increase in the RPI over the three years starting with the 
financial year in which the option is granted.
Subject to both of the above approvals for the scheme the following grants have been made to the directors as detailed below. The number 
of shares and the option price will be determined based on the share price at the award date which will be in October 2013.
 At 30 June  Awarded Exercised At 30 June 
 2012 in the year in the year 2013
N I Holmes - 30,000 - 30,000
S J Jackson - 30,000 - 30,000
A W Shepherd - 30,000 - 30,000
S P Wombwell - 30,000 - 30,000
Total  - 120,000 - 120,000
Dilution
Not more than 15% of the issued ordinary share capital of the Company (adjusted for bonus and rights issues) will be issued for all EMI and 
share incentive schemes operated by the Company in any ten year rolling period. The Company satisfies the various equity based schemes 
it operates using a combination of market purchased, newly issued and treasury shares.
Pension arrangements
Following a satisfactory completion of a probationary period all employees are offered the opportunity to become members of a group 
defined contribution plan established with Legal & General. In the case of certain directors and senior employees, the Group contributes to 
their personal pension arrangements.
Service contracts for executive directors
The Company has service contracts with its executive directors with a notice period of 12 months and it is company policy that such 
contracts should not normally contain periods of more than 12 months. 
External appointments
Executive directors are encouraged to take on external appointments as non-executive directors but are discouraged from taking more than 
one other position given the time commitment. Prior approval of any new appointment is required by the Board with any fees in excess of 
£10,000 per annum paid to the Company.
Advisers to the Remuneration Committee
During the year the Remuneration Committee have employed professional advisers to assist with the implications of the FCA Remuneration 
Code and to provide industry specific comparative information regarding compensation and pay packages.
Non-executive directors
Non-executive directors do not have contracts of employment but as with other directors are now required to stand for re-election. The 
executive directors are responsible for determining the fees of the non-executive directors who do not receive pension or other benefits from 
the Group and do not participate in any Group incentive schemes.
Board committees’ report Annual Report & Accounts 2013 Brooks Macdonald Group plc
16
Report of the directors 
The directors present herewith their annual report, together with 
the audited financial statements of the Group for the year ended  
30 June 2013. 
Principal activities and business review
A review of the Group’s activities and future developments, 
including the financial performance during the year, key 
performance indicators and a description of the principal risks and 
uncertainties facing the group, is included within the group 
overview, the Chairman’s statement, the Chief Executive’s review, 
the business review and the board committees’ report, which form 
part of the report of the directors.
Results and dividends
The profit before taxation for the year ended 30 June 2013 was 
£10,398,000 (2012: £8,520,000) and the profit after taxation was 
£8,030,000 (2012: £6,256,000).
The Company paid an interim dividend during the year of 6.5p 
(2012: 6.0p). The directors recommend a final dividend of 16.0p 
per share (2012: 12.5p). This results in total dividends for the year 
of 22.5p (2012: 18.5p) per ordinary share. These dividends amount 
to a total distribution to shareholders of £2,938,000 (2012: 
£2,007,000).
Directors and their interests
Those who served as directors of the Company at any time during 
the year and their beneficial interests in the share capital of the 
Company at the beginning and end of the year were as follows:
 At 30 June 2013* At 30 June 2012 
 Number of shares Number of shares
Chairman
C J Knight 71,585 71,585
Executives
C A J Macdonald 827,889 808,103
N I Holmes 40,510 47,624
S J Jackson 56,799 55,657
A W Shepherd 51,165 49,261
R H Spencer 773,353 758,853
S P Wombwell 88,204 88,204
J M Gumpel* 640,174 640,174
N H Lawes* 37,057 37,057
Non-executives  
C R Harris 6,086 4,944
D Seymour-Williams 5,000 4,000
* Or at date of resignation 
Details of share options held by the directors at the beginning and 
the end of the year can be found within the Remuneration 
Committee report on pages 10 to 15.
Retirement and re-appointment of directors
Christopher Knight, Christopher Macdonald and Colin Harris will 
retire by rotation at the Annual General Meeting and are eligible to 
nominate themselves for re-election.
Directors’ indemnities 
The Company has made qualifying third party indemnity provisions 
for the benefit of its directors and these remain in force at the date 
of the report. Annual Report & Accounts 2013
17
Brooks Macdonald Group plc
Report of the directors 
Employment policies 
Employees are encouraged to identify and become involved with 
the financial performance of the Group and are rewarded by 
involvement in profit sharing arrangements. Employees also have 
the opportunity to participate in the Group’s share incentive plans.
The Group considers that communication with our employees is 
very important and indeed vital for the success of the Group. 
Employees are informed of important issues by electronic mail  
and seminars.
The Group considers that regular training is extremely important. 
This is achieved by the provision of in-house and external training 
courses and the training team provide a number of continuing 
professional development activities. All staff are encouraged to 
report their specific training needs to their line managers.
The Group operates a graduate training scheme in respect of its 
trainee investment fund managers and financial planning consultants.
The group is an equal opportunities employer. All job applicants and 
employees are treated fairly and on merit, regardless of their race, 
gender, marital status, age, disability, religious belief or sexual 
orientation. Applications from disabled persons are always 
considered and where employees become disabled, efforts are made 
to continue their employment within the Group by providing 
training and the supply of equipment if necessary so that they are 
able to continue their role. 
All staff have the option to take an interest-free annual season ticket 
loan. To retain the Group’s employees and to improve staff morale, 
the Group recognises the need for employees to have an 
appropriate work-life balance. Long-serving employees are entitled 
to additional annual leave dependent on their length of service.
Employees who have been with the Group for more than one year 
are encouraged to join the Group’s pension scheme.  
Substantial shareholdings
As at 31 August 2013, the Company had received notification of 
substantial interests in its shares of 3% or more as follows:
 Number Percentage  
 of shares holding
Liontrust Asset Management 2,017,447 15.11%
Artemis Investment Management 1,257,331 9.42%
C A J Macdonald 827,889 6.20%
Hargreave Hale 784,942 5.88%
Standard Life Investments 780,640 5.85%
R H Spencer 773,353 5.79%
Kames Capital 683,030 5.12%
J M Gumpel 642,460 4.81%
Spearpoint Holdings 428,227 3.21%
Invesco Asset Management 412,414 3.09%
Political and charitable donations
No contributions were made for political purposes during the year 
(2012: £nil). 
During the year, the group made contributions of £20,000 (2012: 
£15,000) to the Brooks Macdonald Foundation, which is 
administered by the Charities Aid Foundation (CAF). Staff are 
encouraged to donate to charity in a tax efficient manner through 
the Give As You Earn (GAYE) payroll giving scheme. 
The objective of the foundation is to make charitable donations and 
support community activities, as suggested by employees, as well as 
to support employees’ participation in a wide range of activities 
involving both local and international charities.
Payment policy 
The Group does not apply a specific payment code. The payment of 
suppliers’ invoices is made in accordance with the terms agreed 
with individual suppliers subject to the resolution of any 
disagreement regarding the supply. In the majority of cases, the 
terms agreed with suppliers are for payment within 30 days of their 
invoice date. At the year end, trade payables for the Group 
represented, on average, 37 days (2012: 39 days) of credit based on 
the Group’s annual purchases. Annual Report & Accounts 2013 Brooks Macdonald Group plc
18
Events since the end of the year
Details of events after the reporting date are set out in note 32 to 
the consolidated financial statements.
Independent auditors
The Audit Committee has recommended to the Board of Directors 
that the incumbent auditor, PricewaterhouseCoopers LLP, be 
reappointed. PricewaterhouseCoopers LLP have expressed their 
willingness to continue in office as auditor and a resolution to 
reappoint them as auditor will be proposed at the forthcoming 
Annual General Meeting.
Each of the directors in office at the date of signing this report 
confirms that, so far as they are aware, there is no relevant audit 
information of which the Company’s auditor is unaware. Each 
director has taken all reasonable steps that he or she ought to have 
taken as a director in order to make him or herself aware of any 
relevant audit information and to establish that the Company’s 
auditor is aware of that information.
Annual General Meeting
The 2013 Annual General Meeting will be held on 17 October 2013 
at 111 Park Street, London, W1K 7JL. The notice of the meeting is 
on pages 63 to 69 with details of the resolutions proposed and 
explanatory notes.
On behalf of the Board of Directors,
 
S J Jackson 
Finance Director
10 September 2013
Report of the directors  Annual Report & Accounts 2013
19
Brooks Macdonald Group plc
The directors are responsible for preparing the Annual Report and 
the financial statements in accordance with applicable law and 
regulations.
Company law requires the directors to prepare financial statements 
for each financial year. Under that law the directors have prepared 
the group financial statements in accordance with International 
Financial Reporting Standards (IFRSs) as adopted by the European 
Union, and the parent company financial statements in accordance 
with United Kingdom Generally Accepted Accounting Practice 
(United Kingdom Accounting Standards and applicable law). 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 Company and Group for that period. In 
preparing these financial statements, the directors are required to:
•  select suitable accounting policies and then apply them 
consistently;
•  make judgements and accounting estimates that are reasonable 
and prudent;
•  state whether IFRSs as adopted by the European Union and 
applicable UK Accounting Standards have been followed, 
subject to any material departures disclosed and explained in 
the group and parent company financial statements 
respectively; and
•  prepare the financial statements on the going concern basis 
unless it is inappropriate to presume that the Company will 
continue in business.
The directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain the Company’s 
transactions and disclose with reasonable accuracy at any time the 
financial position of the Company and enable them to ensure that 
the financial statements comply with the Companies Act 2006. They 
are also responsible for safeguarding the assets of the Company and 
the Group 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 Group’s website. Legislation in the United Kingdom governing 
the preparation and dissemination of financial statements may differ 
from legislation in other jurisdictions.
Statement of directors’ responsibilities Annual Report & Accounts 2013 Brooks Macdonald Group plc
20
We have audited the group financial statements of Brooks 
Macdonald Group plc for the year ended 30 June 2013 which 
comprise the consolidated statement of comprehensive income, the 
consolidated statement of financial position, the consolidated 
statement of changes in equity, the consolidated statement of cash 
flows and the related notes. The financial reporting framework that 
has been applied in their preparation is applicable law and 
International Financial Reporting Standards (IFRSs) as adopted by 
the European Union.
Respective responsibilities of directors and auditors
As explained more fully in the statement of directors’ responsibilities 
set out on page 19, the directors are responsible for the preparation 
of the financial statements and for being satisfied that they give a 
true and fair view. Our responsibility is to audit and express an 
opinion on the financial statements in accordance with applicable 
law and International Standards on Auditing (UK and Ireland). Those 
standards require us to comply with the Auditing Practices Board’s 
Ethical Standards for Auditors.
This report, including the opinions, has been prepared for and only 
for the Company’s members as a body in accordance with Chapter 
3 of Part 16 of the Companies Act 2006 and for no other purpose. 
We do not, in giving these opinions, accept or assume responsibility 
for any other purpose or to any other person to whom this report is 
shown or into whose hands it may come save where expressly 
agreed by our prior consent in writing.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and 
disclosures in the financial statements sufficient to give reasonable 
assurance that the financial statements are free from material 
misstatement, whether caused by fraud or error. This includes an 
assessment of: whether the accounting policies are appropriate to 
the Group’s circumstances and have been consistently applied and 
adequately disclosed; the reasonableness of significant accounting 
estimates made by the directors; and the overall presentation of the 
financial statements. In addition, we read all the financial and 
non-financial information in the Annual Report & Accounts to 
identify material inconsistencies with the audited financial 
statements. If we become aware of any apparent material 
misstatements or inconsistencies we consider the implications for 
our report.
Opinion on financial statements 
In our opinion the group financial statements: 
•  give a true and fair view of the state of the Group’s affairs as at 
30 June 2013 and of its profit and cash flows for the year then 
ended;
•  have been properly prepared in accordance with IFRSs as 
adopted by the European Union; and 
•  have been prepared in accordance with the requirements of the 
Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Report of the Directors 
for the financial year for which the group financial statements are 
prepared is consistent with the group financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters 
where the Companies Act 2006 requires us to report to you if, in 
our opinion: 
•  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. 
Other matter
We have reported separately on the parent company financial 
statements of Brooks Macdonald Group plc for the year ended 
30 June 2013.
Marcus Hine (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London 
10 September 2013
Independent auditor’s report 
to the members of Brooks Macdonald Group plc Annual Report & Accounts 2013
21
Brooks Macdonald Group plc
Consolidated statement of comprehensive income
for the year ended 30 June 2013
 Note 2013 2012 
  £’000  £’000
Revenue  4 63,159 53,288
Administrative expenses   (52,661) (44,886)
Operating profit 5 10,498 8,402
 
Analysed as:   
Operating profit before exceptional items  11,545 8,402
Costs of acquiring subsidiary companies 5 (1,047) -
Operating profit after exceptional items  10,498 8,402
Finance income  7 179 166
Finance cost 7 (279) (48)
Profit before tax  10,398 8,520
 
Analysed as:   
Profit before tax and exceptional items  11,445 8,520
Costs of acquiring subsidiary companies 5 (1,047) -
Profit before tax  10,398 8,520
Taxation 8 (2,368) (2,264)
Profit for the year attributable to owners of the parent  8,030 6,256
 
Other comprehensive income:   
Revaluation of available for sale financial assets 13 (9) 27
Total comprehensive income for the year net of tax  
attributable to owners of the parent  8,021 6,283
Earnings per share*   
Basic 25 65.76p 57.43p
Diluted 25 65.16p 56.58p
* Comparative amounts have been restated to reflect the impact of new shares issued
The accompanying notes on pages 25 to 55 form an integral part of the consolidated financial statements. Annual Report & Accounts 2013 Brooks Macdonald Group plc
22
Consolidated statement of financial position 
as at 30 June 2013
     
  Note 2013 2012 
   £’000  £’000
Assets
Non-current assets   
Intangible assets  11 44,624 10,432
Property, plant and equipment  12 2,421 2,367
Available for sale financial assets  13 1,582 1,657
Deferred tax assets 14 858 668
Total non-current assets    49,485 15,124
Current assets    
Trade and other receivables  15 17,773 12,780
Cash and cash equivalents  16 18,440 13,489
Total current assets   36,213 26,269
Total assets  85,698 41,393
Liabilities 
Non-current liabilities    
Deferred consideration 17  (5,804) (959)
Deferred tax liabilities 14 (4,498) (693)
Other non-current liabilities 18 (125) (418)
Total non-current liabilities  (10,427) (2,070) 
Current liabilities   
Trade and other payables 19 (13,779) (13,845)
Current tax liabilities  (1,149) (79)
Provisions  20 (2,783) (1,689)
Total current liabilities   (17,711) (15,613)
Net assets   57,560 23,710
Equity    
Share capital  22 133 109
Share premium account  22 31,868 4,423
Other reserves  23 3,952 2,988
Retained earnings 23 21,607 16,190
Total equity   57,560 23,710
The consolidated financial statements were approved by the Board of Directors and authorised for issue on 10 September 2013, signed on 
their behalf by:
C A J Macdonald  S J Jackson 
Chief Executive  Finance Director 
Company Registration Number 4402058. 
The accompanying notes on pages 25 to 55 form an integral part of the consolidated financial statements. Annual Report & Accounts 2013
23
Brooks Macdonald Group plc
Consolidated statement of changes in equity
for the year ended 30 June 2013
  Share premium    
 Share capital account Other reserves Retained earnings Total 
 £’000 £’000 £’000 £’000 £’000
Balance at 1 July 2011 108 4,125 2,563 12,255 19,051
 
Comprehensive income      
Profit for the year - - - 6,256 6,256
Other comprehensive income:     
Revaluation of available for sale financial asset - - 27 - 27
Total comprehensive income  - - 27 6,256 6,283
 
Transactions with owners     
Issue of ordinary shares 1 298 - - 299
Share-based payments  - - 702 - 702
Share-based payments transfer - - (188) 188 -
Purchase of own shares by employee benefit trust - - - (785) (785)
Deferred tax on share options - - (116) - (116)
Dividends paid (note 10) - - - (1,724) (1,724)
Total transactions with owners 1 298 398 (2,321) (1,624)
Balance at 30 June 2012 109 4,423 2,988 16,190 23,710
Comprehensive income     
Profit for the year - - - 8,030 8,030
Other comprehensive income:     
Revaluation of available for sale financial asset - - (9) - (9)
Total comprehensive income - - (9) 8,030 8,021
Transactions with owners    
Issue of ordinary shares 24 27,445 - - 27,469
Share-based payments  - - 1,111 - 1,111
Share-based payments transfer - - (350) 350 -
Purchase of own shares by employee benefit trust - - - (779) (779)
Deferred tax on share options - - 212 - 212
Dividends paid (note 10) - - - (2,184) (2,184)
Total transactions with owners 24 27,445 973 (2,613) 25,829
Balance at 30 June 2013 133 31,868 3,952 21,607 57,560
The accompanying notes on pages 25 to 55 form an integral part of the consolidated financial statements.  Annual Report & Accounts 2013 Brooks Macdonald Group plc
24
Consolidated statement of cash flows
for the year ended 30 June 2013
 Note 2013 2012 
  £’000  £’000
Cash flows from operating activities    
Cash generated from operations 21 9,518 3,571 
Taxation paid  (1,661) (1,460)
Net cash generated from operating activities  7,857 2,111
 
Cash flows from investing activities 
Purchase of property, plant and equipment  (863) (1,215)
Purchase of intangible assets  (617) (2,113)
Purchase of available for sale financial assets  - (63)
Acquisition of subsidiary companies, net of cash acquired 9 (20,757) -
Interest received  179 166
Proceeds of sale of property, plant and equipment  - 6
Proceeds of sale of intangible assets  32 -
Proceeds of sale of available for sale financial assets  63 -
Net cash used in investing activities  (21,963) (3,219)
 
Cash flows from financing activities   
Proceeds of issue of shares  22,020 298
Purchase of own shares by employee benefit trust  (779) (785)
Dividends paid to shareholders  (2,184) (1,724)
Net cash generated from / (used in) financing activities  19,057 (2,211)
Net increase / (decrease) in cash and cash equivalents  4,951 (3,319)
Cash and cash equivalents at beginning of year  13,489 16,808
Cash and cash equivalents at end of year 16 18,440 13,489
The accompanying notes on pages 25 to 55 form an integral part of the consolidated financial statements. Annual Report & Accounts 2013
25
Brooks Macdonald Group plc
1. General information
Brooks Macdonald Group plc (‘the Company’) is the parent company of a group of companies (‘the Group’), which offers a range of investment 
management services and related professional advice to private high net worth individuals, charities, and trusts. The Group also provides financial 
planning as well as offshore fund management and administration services and acts as fund manager to regulated OEICs, providing specialist funds 
in the property and structured return sectors and managing property assets on behalf of these funds and other clients.
The Company is a public limited company, incorporated and domiciled in the United Kingdom under the Companies Act 2006 and listed on AIM. 
The address of its Registered Office is 111 Park Street, Mayfair, London, W1K 7JL.
2. Principal accounting policies
The general accounting policies applied in the preparation of these financial statements are set out below. These policies have been applied 
consistently to all years presented, unless otherwise stated.
(a) Basis of preparation
  The Group’s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted 
by the European Union, IFRIC interpretations, and the Companies Act 2006 applicable to companies reporting under IFRS. The financial 
statements have been prepared on the historical cost basis, except for the revaluation of available for sale financial assets such that they are 
measured at their fair value.
  At the time of approving the financial statements, the directors have a reasonable expectation that the Company and the Group have adequate 
resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in 
preparing the financial statements.
(b) Basis of consolidation
  The Group’s financial statements comprise a consolidation of the financial statements of the parent company (Brooks Macdonald Group plc) 
and its subsidiaries. The underlying financial statements of the subsidiaries are prepared for the same reporting year as the parent company, 
using consistent accounting policies. Subsidiaries are all entities controlled by the Company, deemed to exist where the Company has the 
power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The financial statements of the 
subsidiaries are included from the date on which control is transferred to the Group to the date that control ceases.
 All intercompany transactions and balances between group companies are eliminated on consolidation.
(c) Changes in accounting policies
  The Group’s accounting policies applied to these financial statements are consistent with those disclosed within the financial statements for the 
year ended 30 June 2012, except as described below.
 New standards, amendments and interpretations affecting the reported results of the Group
  In the current year no new standards, amendments or interpretations adopted by the Group have had a material effect on the amounts 
reported in these financial statements.
 New standards, amendments and interpretations not affecting the reported results of the Group
  The following standards, amendments and interpretations have been adopted in the current period. Their adoption has not had a significant 
impact on the amounts reported in these financial statements but may impact the accounting for future transactions and arrangements:
  Amendment to IAS 1 ‘Financial statement presentation regarding other comprehensive income’ (effective for annual periods beginning on or 
after 1 July 2012).
Notes to the consolidated financial statements  Annual Report & Accounts 2013 Brooks Macdonald Group plc
26
Notes to the consolidated financial statements 
2. Principal accounting policies (continued)
(c) Changes in accounting policies (continued)
 New standards, amendments and interpretations not yet effective
  A number of new standards, amendments and interpretations have been issued, which are effective for annual and interim periods beginning 
after 1 July 2012 and have therefore not been applied in preparing these financial statements:
Standard, Amendment or Interpretation   Effective date
Amendment to IFRS 1 ‘First-time Adoption of IFRS’   1 January 2013
Amendment to IFRS 7 ‘Financial Instruments: Disclosures’   1 January 2013
Amendment to IAS 19 ‘Employee Benefits’   1 January 2013
IFRS 10 ‘Consolidated Financial Statements’   1 January 2014
IFRS 11 ‘Joint Arrangements’   1 January 2014
IFRS 12 ‘Disclosures of Interests in Other Entities’   1 January 2014
IFRS 13 ‘Fair Value Measurement’   1 January 2013
IAS 27 (revised 2011) ‘Separate Financial Statements’   1 January 2014
IAS 28 (revised 2011) ‘Associates and Joint Ventures’   1 January 2014
Amendment to IAS 32 ‘Financial instruments: Presentation’   1 January 2014
IFRS 9 ‘Financial Instruments: Classification and Measurement’   1 January 2015
 
 These changes are currently being assessed but none are expected to have a significant impact on the Group’s future financial statements.
(d) Critical accounting estimates and judgements
  The preparation of financial information requires the use of assumptions, estimates and judgements about future conditions. Use of currently 
available information and application of judgement are inherent in the formation of estimates. Actual results in the future may differ from those 
reported. In this regard, management believes that the accounting policies where judgement is necessarily applied are those that relate to the 
measurement of intangible assets, deferred consideration, the estimation of the fair value of share-based payments and client compensation 
provisions.
  The underlying assumptions made are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which 
the estimate is revised only if the revision affects both current and future periods.
 Further information about key assumptions and sources of estimation uncertainty are set out below.
 Intangible assets
  The Group has acquired client relationships and new teams of fund managers as described in note 9 and note 11 and in assessing the fair value 
of those assets the Group has estimated their finite life based on information about existing client relationships. Contracts acquired with fund 
managers and acquired client relationship contracts are amortised on a straight line basis over 5 to 20 years.
  Goodwill recognised as part of a business combination is reviewed annually for impairment, or when a change in circumstances indicates that it 
might be impaired. The recoverable amounts of cash generating units are determined based on value in use calculations, which require the use 
of estimates (note 11). Annual Report & Accounts 2013
27
Brooks Macdonald Group plc
2. Principal accounting policies (continued)
(d) Critical accounting estimates and judgements (continued)
 Deferred consideration
  As described in note 17, the Group has a deferred consideration balance in respect of the acquisition of client relationship contracts from Clarke 
Willmott LLP in October 2011, the acquisition of JPAM Limited in July 2012 and the acquisition of Brooks Macdonald Asset Management 
(International) Limited and Brooks Macdonald Retirement Services (International) Limited in November 2012. Deferred consideration is 
recognised at its fair value, being an estimate of the amount that will ultimately be payable in future periods. This has been calculated allowing 
for estimated growth in the acquired funds, discounted by the cost of capital. The Group considers that potential changes to these assumptions 
would not result in a material change in the fair value of the deferred consideration. 
 Share-based payments
  The Group operates various share-based payment schemes in respect of services received from certain employees. Estimating the fair value of 
these share-based payments requires the Group to apply an appropriate valuation model and determine the inputs to that model (notes 19 and 
24). The charge to the consolidated statement of comprehensive income in respect of share-based payments is calculated using assumptions 
about the number of eligible employees that will leave the Group and the number of employees that will satisfy the relevant performance 
conditions. These estimates are reviewed regularly.
 Provisions 
  In the ordinary course of business, the Group may receive complaints from clients in relation to the services provided. Complaints are assessed 
on a case-by-case basis and provisions are made where it is judged to be likely that compensation will be paid.
(e) Exceptional items
  Exceptional items are disclosed and described separately in the financial statements where it is necessary to do so to provide further 
understanding of the underlying financial performance of the Group. These include material items of income or expense that are shown 
separately due to the significance of their nature or amount.
(f) Business combinations 
  Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured at the fair value of the aggregate 
amount of the consideration transferred at the acquisition date, irrespective of the extent of any minority interest. Acquisition costs are charged 
to the consolidated statement of comprehensive income in the year of acquisition.
  When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in 
accordance with the contractual terms, economic circumstances and pertinent conditions at the acquisition date. If the business combination is 
achieved in stages, the fair value of the Group’s previously held equity interest is re-measured at the acquisition date and the difference is 
credited or charged to the consolidated statement of comprehensive income. Identifiable assets and liabilities assumed on acquisition are 
recognised in the consolidated statement of financial position at their fair value at the date of acquisition.
  Any contingent consideration to be paid by the Group to the vendor is recognised at its fair value at the acquisition date. Subsequent changes 
to the fair value of contingent consideration are recognised in accordance with IAS 39 in the consolidated statement of comprehensive income.
  Goodwill is initially measured at cost, being the excess of the consideration transferred over the acquired company’s net identifiable assets 
acquired and liabilities assumed. If the consideration is lower than the fair value of the net assets acquired, the difference is recognised as a gain 
on a bargain purchase in the consolidated statement of comprehensive income.
Notes to the consolidated financial statements  Annual Report & Accounts 2013 Brooks Macdonald Group plc
28
2. Principal accounting policies (continued)
(f) Business combinations (continued)
 Impairment
  Goodwill and other intangible assets with an indefinite life are tested annually for impairment. For the purposes of impairment testing, goodwill 
acquired in a business combination is allocated to each of the Group’s cash generating units that are expected to benefit from the combination, 
irrespective of whether other assets or liabilities of the acquisition are assigned to those units. The carrying amount of each cash generating unit 
is compared to its recoverable amount, which is determined using a discounted future cash flow model.
  Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the 
operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. 
Goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portion of the cash 
generating unit retained.
(g)  Fees, commissions and interest
  Portfolio management and other advisory and custody services are billed in arrears but are recognised over the period the service is provided. 
Fees are calculated on the basis of a percentage of the value of the portfolio over the period. Dealing charges are levied at the time a deal is 
placed for a client. Fees are only recognised when the fee amount can be estimated reliably and it is probable that the fee will be receivable. 
Amounts are shown net of rebates paid to significant investors.
  Financial consulting fees are charged to clients using an hourly rate or by a fixed fee arrangement and are recognised over the period the 
service is provided. Commissions receivable and payable are accounted for in the period in which they are earned.
  Where amounts due are conditional on the successful completion of fund raising for investment vehicles, revenue is recognised where, in the 
opinion of the directors, there is reasonable certainty that sufficient funds have been raised to enable the successful operation of that investment 
vehicle. Amounts due on an annual basis for the management of third party investment vehicles are recognised on a time apportioned basis.
 Interest receivable is recognised on an accruals basis.
(h) Cash and cash equivalents 
  Cash comprises of cash in hand and call deposits held with banks. Cash equivalents comprise of short-term, highly liquid investments, with a 
maturity of less than three months from the date of acquisition.
(i) Share-based payments
  Equity settled schemes 
  The Group engages in equity settled share-based payment transactions in respect of services received from certain employees. The fair value of 
the services received is measured by reference to the fair value of the shares or share options on the grant date. This cost is then recognised in 
the consolidated statement of comprehensive income over the vesting period, with a corresponding credit to equity.
   The fair value of the options granted is determined using option pricing models, which take into account the exercise price of the option, the current 
share price, the risk free rate of interest, the expected volatility of the Company’s share price over the life of the award and other relevant factors.
   Cash settled schemes 
  The Group engages in cash settled share-based payment transactions in respect of services received from certain employees. On the grant date, 
the liability is measured at its fair value. The liability is subsequently re-measured at the end of each reporting period and on the date of 
settlement, with any changes in fair value recognised in the consolidated statement of comprehensive income. The cost of the services received 
from the employee in respect of this scheme is recognised in the consolidated statement of comprehensive income with a corresponding credit 
to accruals. 
Notes to the consolidated financial statements  Annual Report & Accounts 2013
29
Brooks Macdonald Group plc
2. Principal accounting policies (continued)
(j) Segmental reporting 
  The Group determines and presents operating segments based on the information that is provided internally to the Group Board of Directors, 
which is the Group’s chief operating decision maker. 
(k) Fiduciary activities 
  The Group commonly acts as trustee and in other fiduciary capacities that result in the holding or placing of assets on behalf of individuals, 
trusts, retirement benefit plans and other institutions. These assets and income arising thereon are excluded from these financial statements, as 
they are not assets of the Group.
  The Group holds money on behalf of some clients in accordance with the client money rules of the Financial Conduct Authority. Such monies 
and the corresponding liability to clients are not included within the consolidated statement of financial position as the Group is not beneficially 
entitled thereto.
(l) Property, plant and equipment 
  All property, plant and equipment is included in the consolidated statement of financial position at historical cost less accumulated depreciation 
and impairment. Costs include the original purchase cost of the asset and the costs attributable to bringing the asset into a working condition 
for its intended use.
  Provision is made for depreciation to write off the cost less estimated residual value of each asset, using a straight line method, over its expected 
useful life as follows:
Fixtures and fittings   3 to 6.67 years
Equipment   5 years
Leasehold improvements   over the term of the lease
Motor vehicles   4 years
  The assets’ residual values and useful economic lives are reviewed, and adjusted if appropriate, at the end of each reporting period. Gains and 
losses arising on disposal are determined by comparing the proceeds with the carrying amount. These are included in the consolidated 
statement of comprehensive income.
(m) Intangible assets
  Amortisation of intangible assets is charged to administrative expenses in the consolidated statement of comprehensive income on a straight line 
basis over the estimated useful lives of the assets (4 to 15 years).
 Acquired client relationship contracts and contracts acquired with fund managers
  Intangible assets are recognised where client relationship contracts are either separately acquired or acquired with investment managers. These 
are initially recognised at cost and are subsequently amortised on a straight line basis over their estimated useful economic life. Separately 
acquired client relationship contracts are amortised over 15 years and those acquired with investment managers over 5 years. Both types of 
intangible asset are reviewed annually to determine whether an indicator of impairment exists.
 Computer software
 Computer software costs are amortised on a straight line basis over an estimated useful life of four years.
 
Notes to the consolidated financial statements  Annual Report & Accounts 2013 Brooks Macdonald Group plc
30
Notes to the consolidated financial statements 
2. Principal accounting policies (continued)
(m) Intangible assets (continued)
 Goodwill 
  Goodwill arising as part of a business combination is initially measured at cost, being the excess of the fair value of the consideration transferred 
over the Group’s interest in the net fair value of the separately identifiable assets, liabilities and contingent liabilities of the subsidiary at the date 
of acquisition. In accordance with IFRS 3 Business Combinations, goodwill is not amortised but is reviewed annually for impairment and is 
therefore stated at cost less any provision for impairment of value. Any impairment is recognised immediately in the consolidated statement of 
comprehensive income and is not subsequently reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill 
relating to the entity sold. On acquisition, any goodwill acquired is allocated to cash generating units for the purposes of impairment testing. If 
the cost of the acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the 
consolidated statement of comprehensive income.
(n) Financial assets
  The Group classifies financial assets in the following categories: available for sale; held to maturity; and loans and receivables. The classification 
is determined by management on initial recognition of the financial asset, which depends on the purpose for which it was acquired.
 Loans and receivables 
  Loans and receivables are non-derivative assets with fixed or determinable payments that are not quoted in an active market. They are included 
in current assets except where they have maturities of more than 12 months after the end of the reporting period, in which case they are 
classified as non-current assets. The Group’s loans and receivables are recognised within ‘trade and other receivables’.
  Available for sale
  Available for sale financial assets are non-derivatives that are either specifically designated in this category or are not classified in any of the 
other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 
months of the end of the reporting period. Available for sale financial assets are initially recognised at fair value and are subsequently revalued 
based on the current bid prices of the asset as quoted in active markets. 
 Held-to-maturity
  Held-to-maturity financial assets are non-derivative financial assets with fixed or determinate payments and fixed maturities that the Group’s 
management has the positive intention and ability to hold to maturity. If the Group were to sell anything other than an insignificant amount of 
held-to-maturity financial assets, the whole category would be tainted and reclassified as available for sale. Held-to-maturity financial assets are 
measured at amortised cost.
(o) Provisions
  Provisions are recognised when the Group has a present obligation as a result of a past event, where it is probable that it will result in an 
outflow of economic benefits and can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be 
required to settle the obligation using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks 
specific to the obligation.
 Client compensation 
 Complaints are assessed on a case-by-case basis and provisions for compensation are made where it is judged necessary. Annual Report & Accounts 2013
31
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
2. Principal accounting policies (continued)
(p) Foreign currency translation 
  The Group’s functional and presentational currency is the Pound Sterling. Foreign currency transactions are translated using the exchange rate 
prevailing at the transaction date. At the reporting date, monetary assets and liabilities that are denominated in foreign currencies are 
retranslated at the prevailing rates on that date. Foreign exchange gains and losses resulting from settlement of such transactions and from the 
translation of period-end monetary assets and liabilities are recognised in the consolidated statement of comprehensive income.
(q) Retirement benefit costs 
  Contributions in respect of the Group’s defined contribution pension scheme are charged to the consolidated statement of comprehensive 
income as they fall due.
(r) Taxation 
  Tax on the profit for the year comprises current and deferred tax. Current tax is the expected tax payable on the taxable income for the year, 
using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
  Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and 
their carrying amounts in the Group’s financial statements. Deferred tax assets and liabilities are measured at the tax rates that are expected to 
apply to the period when the asset is realised or the liability settled based on tax rates (and laws) that have been enacted or substantially 
enacted at the reporting date.
  Deferred tax assets are only recognised to the extent that it is probable that future taxable profit will be available against which the temporary 
differences can be utilised.
(s) Trade receivables  
  Trade receivables are initially recognised and subsequently measured at the original invoice amount less an allowance for any amounts that are 
expected to be uncollectable. Doubtful debts are provided for when the collection of the full amount is no longer probable, whilst bad debts 
are immediately written off when identified.
(t) Trade payables  
  Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. These are 
classified as current liabilities if payment is due within 12 months or less (or in the normal operating cycle of the business if longer). Otherwise, 
they are presented as non-current liabilities in the consolidated statement of financial position.
 Trade payables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method.
(u) Operating lease payments 
  Rent payments due under operating leases are charged to the consolidated statement of comprehensive income on a straight line basis over the 
term of the lease. Where leases include lease incentives such as rent-free periods, the benefit of these incentives is recognised over the lease 
term as a reduction in the rental expense. Annual Report & Accounts 2013 Brooks Macdonald Group plc
32
Notes to the consolidated financial statements 
2. Principal accounting policies (continued)
(v) Financial instruments 
  The Group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity 
instrument in accordance with the substance of the contractual arrangement. Financial instruments are recognised on the consolidated 
statement of financial position at fair value when the Group becomes a party to the contractual provisions of the instrument.
(w) Carried interest receivable 
  The Group earns a performance fee, carried interest receivable, on funds it manages on behalf of its investors. Carried interest receivable is 
recognised where, at the reporting date, the performance criteria have been met based on the valuations of the funds. Carried interest that has 
been earned, but is not yet due for payment, is discounted to its present value. This is included within current liabilities in the consolidated 
statement of financial position.
(x) Employee Benefit Trust (EBT) 
  The Company provides finance to an EBT to purchase the Company’s shares on the open market in order to meet its obligation to provide 
shares when an employee exercises certain options or awards made under the Group’s share-based payment schemes. The administration and 
finance costs connected with the EBT are charged to the consolidated statement of comprehensive income. The cost of the shares held by the 
EBT is deducted from equity. A transfer is made between other reserves and retained earnings over the vesting periods of the related share 
options or awards to reflect the ultimate proceeds receivable from employees on exercise. The trustees have waived their rights to receive 
dividends on the shares.
  The EBT is considered to be a Special Purpose Entity (SPE) where the substance of the relationship between the Group and the SPE indicates 
that the SPE is controlled by the Group. In substance, the activities of the trust are being conducted on behalf of the Group according to its 
specific business needs, in order to obtain benefits from its operation. On this basis, the assets held by the trust are consolidated into the 
Group’s financial statements.
(y) Share capital
  Ordinary share capital is classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in 
equity as a deduction, net of tax, from the proceeds.
  Where the parent company purchases the Company’s equity share capital (treasury shares) the consideration paid, including any directly 
incremental costs (ie net of income taxes) is deducted from equity attributable to the Company’s equity holders until the shares are cancelled or 
reissued. Where such ordinary shares are subsequently reissued, any consideration received (net of any directly attributable incremental 
transaction costs and the related income tax effects) is included within equity attributable to the Company’s equity holders. 
(z) Dividend distribution
  The dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s financial statements in the period in which 
the dividend is approved by the Company’s shareholders.
3. Segmental information
  For management purposes the Group’s activities are organised into three operating divisions: investment management (including the results of 
Brooks Macdonald (International) Limited, financial planning (including the results of Brooks Macdonald Retirement Services (International) 
Limited) and fund and property management. The Group’s other activity, offering nominee and custody services to clients, is included within 
investment management. These divisions are the basis on which the Group reports its primary segmental information. Annual Report & Accounts 2013
33
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
3. Segmental information (continued)
Revenues and expenses are allocated to the business segment that originated the transaction. Revenues and expenses that are not directly originated 
by a particular business segment are reported as unallocated. Sales between segments are carried out at arm’s length. Centrally incurred expenses 
are allocated to business segments on an appropriate pro-rata basis. Segmental assets and liabilities comprise operating assets and liabilities, being 
the majority of the balance sheet.
In accordance with IFRS 8 ‘Operating Segments’, disclosures are required to reflect the information which the Board uses internally for evaluating the 
performance of its operating segments and allocating resources to those segments. The information presented in this note follows the presentation 
for internal reporting to the Group Board of Directors.
 
 Investment Financial Fund and   
 management planning property management Total 
Year ended 30 June 2013 £’000 £’000 £’000 £’000
Total segment revenues 55,598 4,242 4,636 64,476
Inter segment revenues - (1,317) - (1,317)
External revenues 55,598 2,925 4,636 63,159
Segment result 14,764 332 (482) 14,614
Unallocated items    (4,216)
Profit before tax    10,398
Taxation    (2,368)
Profit for the year    8,030
 Investment Financial Fund and   
 management planning property management Total 
Year ended 30 June 2012 £’000 £’000 £’000 £’000
Total segment revenues 47,922 2,955 3,236 54,113
Inter segment revenues - (825) - (825)
External revenues 47,922 2,130 3,236 53,288
Segment result 10,255 67 (1,057) 9,265
Unallocated items    (745)
Profit before tax    8,520
Taxation    (2,264)
Profit for the year    6,256
(a) Geographic analysis 
  The Group’s operations are located in the United Kingdom and the Channel Islands. The following table presents underlying operating income 
analysed by the geographical location of the Group entity providing the service.
  2013 2012 
  £’000 £’000
United Kingdom  56,533 53,288
Channel Islands  6,626 -
Total operating income  63,159 53,288
(b) Major clients
 The Group is not reliant on any one client or group of connected clients for the generation of revenues. Annual Report & Accounts 2013 Brooks Macdonald Group plc
34
Notes to the consolidated financial statements 
4.  Revenue
  2013 2012 
  £’000 £’000
Fee income  59,431 48,479
Financial services commission  3,728 4,809
Total revenue  63,159 53,288
5. Operating profit
Operating profit is stated after charging:
  2013 2012 
  £’000 £’000
Staff costs (note 6)  26,907 20,477
Acquisition costs (see below)  1,047 -
Auditors’ remuneration (see below)  282 206
Financial Services Compensation Scheme levy (see below)  359 235
Depreciation (note 12)  863 734
Amortisation (note 11)  1,865 530 
A more detailed analysis of auditors’ remuneration is provided below:   
  2013 2012 
  £’000 £’000
Fees payable to the Company’s auditor for the audit of the  
consolidated group and parent company financial statements  44 32
Fees payable to the Company’s auditor and its associates for other services:    
–  Audit of the Company’s subsidiaries pursuant to legislation  150 88
–  Audit-related assurance services  22 23
–  Tax advisory services  6 12
–  Other assurance services  60 -
–  Other advisory services  - 51
Total auditors’ remuneration  282 206
Acquisition costs 
Administrative costs for the year ended 30 June 2013 include £1,047,000 of directly attributable acquisition costs in 2013, comprised of £30,000 in 
respect of the acquisition of JPAM Limited and £1,017,000 in respect of the acquisition of Brooks Macdonald Asset Management (International) 
Limited and Brooks Macdonald Retirement Services (International) Limited (note 9) (2012: £nil).
Financial Services Compensation Scheme levies
Administrative costs for the year ended 30 June 2013 include a charge of £359,000 for the Financial Services Compensation Scheme (‘FSCS’) levy 
(2012: £235,000). During the year, the Group received invoices totalling £119,000 in respect of additional levies on previous scheme years. An 
amount of £240,000 has also been provided for the estimated levy by the FSCS for the 2013/14 scheme year. Annual Report & Accounts 2013
35
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
6. Employee information 
(a)  Staff costs
  2013 2012 
  £’000 £’000
Wages and salaries  21,920 16,648
Social security costs  2,738 1,866
Other pension costs  625 570
Share-based payments  1,624 1,393
Total staff costs  26,907 20,477
Pension costs relate entirely to a defined contribution scheme.
(b)  Number of employees
The average monthly number of employees during the year, including directors, was as follows:
  2013 2012
Professional staff  156 99
Administrative staff  207 185
Total staff  363 284
(c)  Directors’ emoluments
Key management personnel comprise solely of the Group Board of Directors.
  2013 2012 
  £’000 £’000
Salaries  2,238 2,794
Non-executive directors’ fees  133 126
Benefits in kind  19 22
  2,390 2,942
Pension contributions  79 208
Amounts receivable under long term incentive schemes  278 2,974
Gains on exercise of share options  301 326
Total directors’ remuneration  3,048 6,450
   
Highest paid director   
Remuneration and benefits in kind  517 486
Pension contributions  - 32
Amounts receivable under long term incentive schemes  64 68
Gains on exercise of share options  176 378
Total remuneration  757 964
Retirement benefits are accruing to 6 directors (2012: 8) under a defined contribution pension scheme. Annual Report & Accounts 2013 Brooks Macdonald Group plc
36
Notes to the consolidated financial statements 
7. Finance income and finance costs
  2013 2012 
Finance income  £’000 £’000
Bank interest on deposits  177 163
Tax repayment supplement  2 3
Total finance income  179 166
  2013 2012 
Finance costs  £’000 £’000
Finance cost of deferred consideration  279 48
Total finance costs  279 48
8. Taxation
The tax charge on profit on ordinary activities for the year is as follows:
  2013 2012 
  £’000 £’000
UK Corporation Tax at 23.75% (2012: 25.50%)  2,618 1,866
Under provision in prior years  424 6
Total current tax  3,042 1,872
Deferred tax (credit) / charge  (674) 392
Income tax expense  2,368 2,264
Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.
The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the time apportioned tax rate applicable to 
profits of the consolidated entities in the UK as follows:    
  2013 2012 
  £’000 £’000
Profit on ordinary activities before tax  10,398 8,520
   
Profit on ordinary activities multiplied by the standard  
rate of tax in the UK of 23.75% (2012: 25.50%)  2,469 2,173
Tax effect of:  
– Lower tax rates in other countries in which the Group operates  (398) -
– Disallowable expenses  189 102
– Non-taxable income  (260) (116)
– Tax losses utilised on which no deferred tax is provided  (55) -
– Change in rate of Corporation Tax  (1) 99
– Under provision in prior years  424 6
Tax charge for the year  2,368 2,264
  Annual Report & Accounts 2013
37
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
8. Taxation (continued)
The deferred tax credit of £674,000 (2012: charge of £392,000) represents a credit of £286,000 (2012: £414,000 charge) arising from the share 
option reserve at the balance sheet date, a credit of £10,000 (2012: £22,000) relating to accelerated capital allowances and a credit of £377,000 
(2012: £nil) arising from the amortisation of acquired client relationship contracts.
On 1 April 2013, the standard rate of Corporation Tax in the UK was reduced from 24% to 23%. As a result the effective rate of Corporation Tax 
applied to the taxable profit for the year ended 30 June 2013 is 23.75% (2012: 25.50%).
In addition to the change in the rate of UK Corporation Tax disclosed above, a number of further changes to the UK Corporation Tax system were 
announced in the March 2013 budget, proposing that the main rate of UK Corporation Tax rate be reduced to 21%. The rate will further reduce to 
20% and will become unified with the small companies rate from 1 April 2015. At 30 June 2013 only part of this reduction, taking the rate to 23%, 
had been substantively enacted. Deferred tax assets and liabilities are calculated at the rate that is expected to be in force when the temporary 
differences unwind, but limited to the extent that such rates have been substantively enacted. Consequently the tax rate used to determine the 
deferred tax assets and liabilities is 23% (2012: 24%).
The tax charge relating to components of other comprehensive income is as follows:
  2013 2012 
  £’000 £’000
Revaluation of available for sale investments   (12) 33
Tax charge / (credit) on revaluation of available for sale investments  3 (6)
Total other comprehensive income  (9) 27
9. Business combinations
On 1 July 2012, the Group acquired the entire share capital of JPAM Limited (‘JPAM’). JGHP Limited, a subsidiary company of JPAM, has a portfolio of 
client relationships and offers financial advice to high net worth individuals. The company is a long standing professional introducer of private clients 
and their portfolios to the Group. The acquisition bought out the Group’s continuing obligations to JPAM in advance of the retirement of the 
principal. 
The total consideration of £5,240,000 was satisfied by cash on acquisition of £3,005,000 and contingent deferred consideration for the balance of 
£2,235,000, due in three annual instalments and based on the value of the discretionary funds under management retained at each instalment date. 
The fair value of the liability has been re-measured at the period end assuming that the value of the discretionary funds retained follows a similar 
growth pattern to that experienced by the rest of the Group. A range of final outcomes cannot be estimated as the future value of the funds under 
management is dependent on several unpredictable variables including client retention and market movements.
Directly attributable acquisition costs of £30,000 were incurred in the acquisition, which have been charged to the consolidated statement of 
comprehensive income.
The fair value of the assets acquired are the gross contractual amounts and all are considered to be fully recoverable. The fair value of the identifiable 
assets and liabilities acquired, at the date of acquisition, are detailed in (a) below.
On 19 November 2012, the Group acquired the entire share capital of Brooks Macdonald Asset Management (International) Limited (BMI) (formerly 
Spearpoint Limited) and Brooks Macdonald Retirement Services (International) Limited (BMRS) (formerly Spearpoint Retirement Services Limited), 
incorporated in Guernsey and Jersey respectively. BMI is an integrated wealth management business based in the Channel Islands with discretionary 
and advisory funds and assets under management of £1.1 billion. BMRS offers retirement planning services to clients. The acquisition also added 
scale to the Group, as well as offshore capability and access to the expanding international pensions market. Annual Report & Accounts 2013 Brooks Macdonald Group plc
38
Notes to the consolidated financial statements 
9. Business combinations (continued)
The total consideration of £33,669,000 was satisfied by cash of £21,478,000, the issue of 418,627 new shares in Brooks Macdonald Group plc with a 
value of £5,450,000 and a contingent deferred balance of £6,741,000, payable in two instalments in March 2013 and November 2014 and based 
on the future value of the discretionary funds under management acquired. The fair value of the liability has been re-measured at the period end 
assuming that the value of the discretionary funds retained follows a similar growth pattern to that experienced by the rest of the Group. A range of 
final outcomes cannot be estimated as the future value of the funds under management is dependent on several unpredictable variables including 
client retention and market movements.
Directly attributable acquisition costs of £1,017,000 were incurred in the acquisition, which have been charged to the consolidated statement of 
comprehensive income.
Goodwill of £17,208,000 was recognised on acquisition in respect of expected synergies from combining the operations of BMI and BMRS with 
those of the Group, as well as intangible assets that do not qualify for separate recognition and the experience of the investment management and 
pensions staff employed by the companies.
The fair value of the assets acquired are the gross contractual amounts and all are considered to be fully recoverable. The fair value of the identifiable 
assets and liabilities acquired, at the date of acquisition, are detailed in (a) below.
(a) Net assets acquired through business combinations
  JPAM BMI and BMRS 
  £’000 £’000
Property, plant and equipment  - 54
Trade and other receivables  159 4,190
Cash and cash equivalents  694 3,032
Other current assets  - 735
Trade and other payables  - (1,088)
Other current liabilities  (143) -
Total net assets recognised by acquired companies  710 6,923
Fair value adjustments:  
– Client relationship contracts  5,881 12,156
– Software  - 227
– Deferred tax liability on client relationship contracts and software  (1,351) (2,845)
Net identifiable assets  5,240 16,461
Goodwill  - 17,208
Total purchase consideration  5,240 33,669 Annual Report & Accounts 2013
39
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
9. Business combinations (continued)
(b) Impact on reported results from date of acquisition
  Revenues from Profit for the 
  external customers year  
  £’000 £’000
JPAM Limited  798  438 
Spearpoint entities:  
– Brooks Macdonald Asset Management (International) Limited  6,017  1,660 
– Brooks Macdonald Retirement Services (International) Limited  609  109 
Total Spearpoint entities  6,626  1,769 
Total impact of business combinations  7,424  2,207 
  Had JPAM, BMI and BMRS been consolidated from 1 July 2012, the consolidated statement of comprehensive income would show pro-forma 
revenue of £67,462,000 and post-tax profit for the year of £9,363,000.
(c) Net cash outflow resulting from business combinations
 JPAM BMI and BMRS Total 
 £’000 £’000 £’000
Total purchase consideration (note 9a) 5,240 33,669 38,909
Less:   
– Shares issued as consideration - (5,450) (5,450)
– Deferred cash consideration (2,235) (6,741) (8,976)
Cash paid to acquire subsidiaries 3,005 21,478 24,483
Less: cash held by subsidiaries acquired (694) (3,032) (3,726)
Cash paid to acquire subsidiaries net of cash acquired 2,311 18,446 20,757 
10. Dividends 
Amounts recognised as distributions to equity holders of the Company in the year:
  2013 2012 
  £’000 £’000
Final dividend paid for the year ended 30 June 2012 of 12.5p (2011: 10.0p) per share 1,348 1,082
Interim dividend paid for the year ended 30 June 2013 of 6.5p (2012: 6.0p) per share 836 642
Total dividends  2,184 1,724
 
Final dividend proposed for the year ended 30 June 2013 of 16.0p (2012: 12.5p) per share 2,102 1,365
The interim dividend of 6.5p (2012: 6.0p) per share was paid on 18 April 2013. 
A final dividend for the year ended 30 June 2013 of 16.0p (2012: 12.5p) per share was declared by the Board of Directors on 10 September 2013 
and is subject to approval by the shareholders at the Company’s Annual General Meeting. It will be paid on 18 October 2013 to shareholders who 
are on the register at the close of business on 20 September 2013. In accordance with IAS 10, this dividend has not been included as a liability in 
these financial statements. Annual Report & Accounts 2013 Brooks Macdonald Group plc
40
11. Intangible assets
   Computer Acquired client Contracts acquired 
  Goodwill  software relationship contracts with fund managers Total 
  £’000 £’000 £’000 £’000 £’000
Cost     
At 1 July 2011 3,550 87 2,056 1,850 7,543
Additions - 5 4,811 123 4,939
Disposals - (2) - - (2)
At 30 June 2012 3,550 90 6,867 1,973 12,480 
Additions - 16 - 601 617
Additions on acquisition of subsidiaries at fair value 17,208 227 18,037 - 35,472
Disposals - - (32) - (32)
At 30 June 2013 20,758 333 24,872 2,574 48,537
Accumulated amortisation
1 July 2011 - 23 229 1,268 1,520
Amortisation charge - 25 307 198 530
Disposals - (2) - - (2)
At 30 June 2012 - 46 536 1,466 2,048
Amortisation charge - 113 1,477 275 1,865
At 30 June 2013 - 159 2,013 1,741 3,913
 
Net book value      
At 1 July 2011 3,550 64 1,827 582 6,023
At 30 June 2012 3,550 44 6,331 507 10,432
At 30 June 2013 20,758 174 22,859 833 44,624
(a) Goodwill
  Goodwill acquired in a business combination is allocated at acquisition to the cash generating units (CGUs) that are expected to benefit from 
that business combination. The carrying amount of goodwill at 30 June 2013 comprises £3,550,000 in respect of the Braemar Group Limited 
(‘Braemar’) CGU and £17,208,000 in respect of the Brooks Macdonald Asset Management (International) Limited and Brooks Macdonald 
Retirement Services (International) Limited (collectively ‘Brooks Macdonald International’) CGU.
  Goodwill is reviewed annually for impairment and its recoverability has been assessed at 30 June 2013 by comparing the carrying amount of 
the CGUs to their expected recoverable amount, estimated on a value-in-use basis. The value-in-use of each CGU has been calculated using 
pre-tax discounted cash flow projections based on the most recent budgets approved by the Board, covering a period of up to five years. Cash 
flows are then extrapolated beyond the forecast period using an expected long-term growth rate.
  The key underlying assumptions of the value-in-use calculations are the discount rate, short-term growth in funds under management and the 
long-term growth rate. A pre-tax discount rate of 10% has been used, based on the Group’s assessment of risk-free rates of interest and specific 
risks relating to the Braemar and Brooks Macdonald International businesses. The 2% long-term growth rate is considered prudent in the context 
of the comparative long-term average growth rate for the funds, real estate and investment management industries in which the CGUs operate.
  While it is possible that one of the key assumptions in the calculation could change, no reasonably forseeable change would result in an 
impairment of goodwill given the margin by which the estimated recoverable amount exceeds the carrying amount of the CGUs. Annual Report & Accounts 2013
41
Brooks Macdonald Group plc
11. Intangible assets (continued)
(b) Computer software
 Software costs are amortised over an estimated useful life of four years on a straight line basis.
(c) Acquired client relationship contracts
  This asset represents the fair value of future benefits accruing to the Group from acquired client relationship contracts. The amortisation of client 
relationships is charged to the consolidated statement of comprehensive income on a straight line basis over their estimated useful lives (15 to 
20 years).
  During the year, the Group acquired client relationship contracts totalling £18,037,000 (2012: £4,811,000), as part of business combinations 
(note 9), which were recognised as separately identifiable intangible assets in the consolidated statement of financial position. This included 
contracts with a fair value of £5,881,000 related to the acquisition of JPAM Limited and £12,156,000 related to the acquisition of Brooks 
Macdonald Asset Management (International) Limited.
(d) Contracts acquired with fund managers
  This asset represents the fair value of future benefits accruing to the Group from contracts acquired with fund managers. Payments made to 
acquire such contracts are stated at cost and amortised on a straight line basis over an estimated useful life of 5 years.
12.  Property, plant and equipment 
   Motor  Fixtures and Equipment and leasehold  
   vehicles fittings improvements Total 
  £’000 £’000 £’000 £’000
Cost    
At 1 July 2011 - 696 3,643 4,339
Additions - 736 479 1,215
Disposals - (15) (51) (66)
At 30 June 2012 - 1,417 4,071 5,488
Additions 35 151 677 863
Additions on acquisition of subsidiaries - 54 - 54
Disposals - - - -
At 30 June 2013 35 1,622 4,748 6,405
    
Accumulated depreciation    
At 1 July 2011 - 295 2,152 2,447
Depreciation charge - 154 580 734
Disposals - (15) (45) (60)
At 30 June 2012 - 434 2,687 3,121
Depreciation charge 4 234 625 863
Disposals - - - -
At 30 June 2013 4 668 3,312 3,984
    
Net book value    
At 1 July 2011 - 401 1,491 1,892
At 30 June 2012 - 983 1,384 2,367
At 30 June 2013 31 954 1,436 2,421 Annual Report & Accounts 2013 Brooks Macdonald Group plc
42
Notes to the consolidated financial statements 
13. Available for sale financial assets 
The Group holds an investment of 1,426,793.64 B shares in Braemar Group PCC Limited Student Accommodation Cell. The fund is managed by 
Brooks Macdonald Funds Limited, a subsidiary of the Group. Trading is currently suspended on this fund, however the fund manager continues to 
publish a price based on the fair value of the underlying assets of the fund. At 30 June 2013, the fair value of the investment was £1,582,000 (2012: 
£1,594,000), the loss of £12,000 (2012: gain of £33,000) being recognised in other comprehensive income in the consolidated statement of 
comprehensive income.
There were no additions during the year (2012: £63,000). A £50,000 investment in UK Farming plc was de-recognised as the entity is now 
considered to be controlled by the Group and its assets and liabilities have been consolidated accordingly. The Group disposed of further 
investments of £13,000 (2012: £nil).
  2013 2012 
  £’000 £’000
At beginning of year  1,657 1,561
Additions  - 63
Disposals  (13) -
De-recognised on consolidation of former investment  (50) -
(Loss) / gain from changes in fair value  (12) 33
At end of year  1,582 1,657
14. Deferred income tax
Deferred income tax assets are only recognised to the extent that it is probable that future taxable profit will be available against which the 
temporary differences can be utilised. An analysis of the Group’s deferred assets and deferred tax liabilities is shown below.
  2013 2012 
  £’000 £’000
Deferred tax assets
Deferred tax assets to be recovered after more than 12 months  234 260
Deferred tax assets to be recovered within 12 months  624 408
Total deferred tax assets  858 668
Deferred tax liabilities   
Deferred tax liabilities to be recovered after more than 12 months  (4,468) (672)
Deferred tax liabilities to be recovered within 12 months  (30) (21)
Total deferred tax liabilities  (4,498) (693)
The gross movement on the deferred income tax account during the year is as follows:
  2013 2012 
  £’000 £’000
At 1 July  (25) 1,495
Credit / (charge) to the consolidated statement of comprehensive income (note 8) 674 (392)
Credit / (charge) recognised in other comprehensive income  3 (6)
Charge recognised in equity  (97) (473)
Additions on acquisition of subsidiaries  (4,195) (649)
At 30 June  (3,640) (25) Annual Report & Accounts 2013
43
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
14. Deferred income tax (continued)
The change in deferred income tax assets and liabilities during the year is as follows:
   Share-based payments  
Deferred tax assets   £’000
At 1 July 2011   1,555
Charge to the consolidated statement of comprehensive income   (414)
Charge to equity   (473)
At 30 June 2012   668
Credit to the consolidated statement of comprehensive income   287
Charge to equity   (97)
At 30 June 2013   858
 
     
   Accelerated capital  Available for sale Intangible asset 
   allowances financial assets amortisation Total 
Deferred tax liabilities   £’000  £’000 £’000  £’000 
At 1 July 2011  44 16 - 60
Additions on acquisition of subsidiaries  - - 649 649
Credit to the consolidated statement of comprehensive income  (22) - - (22)
Charge to other comprehensive income  - 6 - 6
At 30 June 2012  22 22 649 693
Additions on acquisition of subsidiaries  - - 4,195 4,195
Credit to the consolidated statement of comprehensive income  (10) - (377) (387)
Charge to other comprehensive income  - (3) - (3)
At 30 June 2013  12 19 4,467 4,498
15. Trade and other receivables
  2013 2012 
  £’000 £’000
Trade receivables  5,158 1,719
Other receivables  766 1,123
Prepayments and accrued income  11,849 9,938
Total trade and other receivables  17,773 12,780
16. Cash and cash equivalents 
  2013 2012 
  £’000 £’000
Cash at bank   18,420 13,470 
Cash held in Employee Benefit Trust  20 19
Total cash and cash equivalents  18,440 13,489
 
Cash and cash equivalents are distributed across a range of financial institutions with high credit ratings in accordance with the Group’s treasury 
policy. Cash at bank comprises current accounts and immediately accessible deposit accounts. Annual Report & Accounts 2013 Brooks Macdonald Group plc
44
17. Deferred consideration
Deferred consideration, which is also included within provisions in current liabilities to the extent that it is due to be paid within one year of the 
reporting date (note 20), relates to the directors’ best estimate of amounts payable in the future in respect of certain client relationships and 
subsidiary undertakings that were acquired by the Group. Deferred consideration is measured at its fair value based on the discounted expected 
future cash flows. The movements in the deferred consideration balance during the year were as follows: 
  2013 2012 
  £’000 £’000
At 1 July  2,309 794
Added on acquisitions during the year  8,976 2,177
Interest accrued  279 49
Payments made during the year  (3,637) (711)
At 30 June  7,927 2,309
Analysed as:
Amounts falling due within one year  2,123 1,350
Amounts falling due after more than one year  5,804 959
Total deferred consideration  7,927 2,309
Deferred consideration of £8,976,000 (2012: £2,177,000) was recognised during the year (note 9), £6,741,000 on the acquisition of BMI and BMRS 
and £2,235,000 on the acquisition of JPAM (2012: £2,177,000 on the acquisition of the client relationship contracts of Clarke Willmott LLP). 
Payments of £3,637,000 (2012: £711,000) were made during the year, representing £2,396,000 to the vendors of BMI and BMRS and £1,241,000 
to Clarke Willmott LLP.
Amounts falling due after more than one year from the reporting date are presented in non-current liabilities as shown below: 
  2013 2012 
  £’000 £’000
At 1 July  959 -
Added on acquisitions during the year  5,597 910
Interest accrued  207 49
Transfer to current liabilities  (959) -
At 30 June  5,804 959
 
The amount payable in respect of acquisitions during the period of £5,597,000 (2012: £910,000) comprises deferred consideration of £4,345,000 
relating to the acquisition of BMI and BMRS and £1,252,000 relating to the acquisition of JPAM (note 9). An amount of £959,000, representing the 
deferred consideration payable in respect of the acquired client relationships of Clarke Willmott LLP, was transferred to provisions within current 
liabilities (2012: £nil).
18. Other non-current liabilities
Other non-current liabilities relate to employer’s National Insurance contributions arising from share option awards under the LTIS scheme. An 
additional liability of £90,000 (2012: 244,000) was recognised during the year in respect of existing awards, granted in previous years, that are 
expected to vest in the future. During the year, an amount of £383,000 (2012: £452,000) was transferred to current liabilities, reflecting awards that 
will vest within the next 12 months.
Notes to the consolidated financial statements  Annual Report & Accounts 2013
45
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
19. Trade and other payables 
  2013 2012 
  £’000 £’000
Trade payables  2,631 2,699
Other taxes and social security  1,394 1,333
Other payables  2,621 308
Accruals and deferred income  7,133 9,505
Total trade and other payables  13,779 13,845
 
Included within accruals and deferred income is an accrual of £837,000 (2012: £985,000) in respect of the Phantom Share Schemes granted in 
October 2008 and October 2009 and employer’s National Insurance contributions arising from share option awards under the LTIS (note 24b). The 
schemes are cash settled and payments are made to participants in respect of their awards by the Group’s subsidiary undertakings. The options are 
awarded at no cost to the participants. The amount that is ultimately payable to participants of the scheme is equal to the increase in market value of 
the Company’s ordinary shares over a three year vesting period. The award will vest after three years to the extent that the performance conditions 
are satisfied and will be forfeited in total if performance fails to meet the minimum criteria. 
The options have been valued using a Black Scholes model based on the market price of the Company’s shares at the grant date (note 24). The total 
charge to the consolidated statement of comprehensive income for the year for all Phantom Share Schemes and employer’s National Insurance 
contributions arising from share option awards under the LTIS (note 24b) was £423,000 (2012: £1,325,000). The number of Phantom Share Options 
outstanding at 30 June 2013 was as follows:
   2013 2013 2012 2012 
   Number of  Weighted average Number of  Weighted average 
   options base price (£) options base price (£)
At 1 July  133,103 6.875 595,603 3.235
Forfeited in the year  (45,000) 7.750 - -
Exercised in the year  (51,000) 4.255 (462,500) 2.185
At 30 June  37,103 9.415 133,103 6.875
20. Provisions
 
  Client   Deferred  FSCS 
  compensation consideration levy Total 
   £’000  £’000 £’000  £’000 
At 1 July 2011 243 794 - 1,037
Charge to the consolidated statement of comprehensive income 182 - 140 322
Added on acquisitions during the year - 1,267 - 1,267
Utilised during the year (86) (711) (140) (937)
At 30 June 2012 339 1,350 - 1,689
Charge to the consolidated statement of comprehensive income 246 - 240 486
Added on acquisitions during the year - 3,379 - 3,379
Interest accrued - 72 - 72
Transfer from non-current liabilities - 959 - 959
Utilised during the year (165) (3,637) - (3,802)
At 30 June 2013 420 2,123 240 2,783
  Annual Report & Accounts 2013 Brooks Macdonald Group plc
46
20. Provisions (continued)
(a)  Client compensation
 Client compensation provisions relate to the potential liability arising from client complaints against the Group. Complaints are assessed on a case by 
case basis and provisions for compensation are made where judged necessary. Complaints are on average settled within eight months (2012: eight 
months) from the date of notification of the complaint.
(b) Deferred consideration
 Deferred consideration has been included within provisions as a current liability to the extent that it is due to be paid within one year of the 
reporting date (note 17).
 Deferred consideration payable within one year of £3,379,000 (2012: £1,267,000) was recognised during the year, comprising of £2,396,000 relating 
to the acquisition of BMI and BMRS and £983,000 relating to the acquisition of JPAM. An amount of £959,000 (2012: £nil) was transferred from 
non-current liabilities, representing the final tranche of deferred consideration payable to Clarke Willmott LLP in November 2013 in respect of client 
relationships acquired in October 2011. Provisions of £3,802,000 (2012: £711,000) were utilised during the year on payment of £1,241,000 to Clarke 
Willmott LLP and £2,396,000 to the vendors of Brooks Macdonald Asset Management (International) Limited and Brooks Macdonald Retirement 
Services (International) Limited.
(c) FSCS levy
 Following confirmation by the FSCS in April 2013 of its proposed 2013/14 industry levy, the Group has made a provision of £240,000 (2012: £nil) for 
its estimated share. The 2012/13 annual levy was billed in June 2012, hence this was included as a trade payable rather than a provision in the 2012 
financial statements.
21. Reconciliation of operating profit to net cash inflow from operating activities 
  2013 2012 
  £’000 £’000
Operating profit  10,498 8,402
Adjustments for:  
Depreciation of property, plant and equipment  863 734
Amortisation of intangible assets   1,865 530
Decrease / (increase) in receivables  91 (2,920)
Decrease in payables  (1,301) (4,319)
(Decrease) / increase in provisions  (2,284) 652
Decrease in non-current liabilities   (1,325) (210)
Share-based payments  1,111 702
Net cash inflow from operating activities  9,518 3,571
In the year ended 30 June 2013, the Group obtained control of JPAM, BMI and BMRS (note 9). The net cash outflow resulting from these business 
combinations is presented in note 9(c).
Notes to the consolidated financial statements  Annual Report & Accounts 2013
47
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
22. Share capital and share premium account 
The movements in share capital and share premium during the year were as follows:
 Number Exercise Share Share premium 
 of shares price capital account Total 
  p £’000 £’000 £’000
At 1 July 2011 10,788,167  108 4,125 4,233
Shares issued:     
  – on exercise of options 75,900 240.0 1 146 147
  – to Sharesave Scheme 63,429 155.0 - 290.5 - 152 152
At 30 June 2012  10,927,496  109 4,423 4,532
Shares issued:     
  – on placing 2,288,193 1,150.0 - 1,301.9 23 26,927 26,950
  – on exercise of options 73,100 140.0 - 290.5 1 327 328
  – to Sharesave Scheme 59,185 240.0 - 578.0 - 191 191
At 30 June 2013 13,347,974  133 31,868 32,001
 
The total number of ordinary shares, issued and fully paid at 30 June 2013 was 13,347,974 (2012: 10,927,496) with a par value of 1p per share. 
On 19 November 2012, the Company issued 1,869,566 ordinary shares by way of a placing for cash consideration which raised £21,500,000 and 
an additional 418,627 ordinary shares with a market value of £5,450,000 as consideration to the vendors of Brooks Macdonald Asset Management 
(International) Limited and Brooks Macdonald Retirement Services (International) Limited.
Shares issued to Sharesave Scheme members are shown as £nil (2012: £nil) due to rounding.
Employee Benefit Trust
The Group established an Employee Benefit Trust (EBT) on 3 December 2010 to acquire ordinary shares in the Company to satisfy awards under the 
Group’s Long Term Incentive Scheme (LTIS) and other share-based payment schemes (note 24). At 30 June 2013, the EBT held 212,172 (2012: 
151,139) 1p ordinary shares in the Company, acquired for a total consideration of £2,544,000 (2012: £1,765,000). The market value of these shares 
was £3,044,668 (2012: £1,738,000). They are presented as treasury shares in the consolidated financial statements and their cost has been 
deducted from retained earnings within shareholders’ equity.
23. Other reserves and retained earnings
Other reserves are comprised of the following balances:
  2013 2012 
  £’000 £’000
Share option reserve  3,697 2,724
Merger reserve  192 192
Available for sale reserve  63 72
Total other reserves  3,952 2,988 Annual Report & Accounts 2013 Brooks Macdonald Group plc
48
Notes to the consolidated financial statements 
23. Other reserves and retained earnings (continued)
The movements in other reserves during the year were as follows:
  2013 2012 
  £’000 £’000
Share option reserve   
At beginning of the year  2,724 2,326
Share-based payments  1,111 702
Transfer to retained earnings  (350) (188)
Deferred tax on share-based payments   212 (116)
At end of the year  3,697 2,724
Merger reserve  
At beginning of the year  192 192
At end of the year  192 192
 
Available for sale reserve  
At beginning of the year  72 45
Revaluation of available for sale financial assets  (9) 27
At end of the year  63 72
 
The movements in retained earnings during the year were as follows:
  2013 2012 
  £’000 £’000
At beginning of the year  16,190 12,225
Profit for the financial year  8,030 6,256
Purchase of own shares by Employee Benefit Trust  (779) (785)
Transfer from share option reserve  350 188
Dividends paid  (2,184) (1,724)
At end of the year  21,607 16,190
24. Equity settled share-based payments
All share options granted to employees under the Group’s equity settled share-based payment schemes are valued using a Black Scholes model, based 
on the market price of the Company’s shares at the grant date and volatility ranging from 15% to 50% on an historic price, covering the period to the 
end of the contractual life. Volatility has been estimated on the basis of the Company’s historical share prices subsequent to flotation. The risk-free 
annual rate of interest is deemed to be the yield on a gilt edged security with a maturity term of ten years, ranging from 0.34% to 2.00%.
For options granted during the year, the Black Scholes model was based on the market price of the Company’s shares at each respective grant date 
and volatility of 50% with no dividend yield, an expected vesting period of three years and a risk-free annual rate of interest of 0.34%. The fair value 
of the cash settled Phantom Share Options has been calculated using the same assumptions, but it is re-calculated on a quarterly basis.
The share options issued under the various equity settled share-based payment schemes have been valued at prices ranging from £nil to £11.62 per 
share. The charge to the consolidated statement of comprehensive income for the year in respect of these was £1,111,000 (2012: £702,000). The 
weighted average remaining contractual life of all equity settled share-based payment schemes at 30 June 2013 was 2.61 years (2012: 3.18 years). 
The weighted average share price of all options exercised during the year was £13.75 (2012: £12.05). The total charge to the consolidated 
statement of comprehensive income for the year for all share-based payment schemes was £1,624,000 (2012: £1,393,000). Annual Report & Accounts 2013
49
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
24. Equity settled share-based payments (continued)
The exercise price and fair value of share options granted during the year was as follows:
  Exercise price Fair value 
  p p
Long Term Incentive Scheme  nil 1,270
Employee Sharesave Scheme  1,172 607
 
No options were granted under the EMI Scheme during the year.
(a) Enterprise Management Incentive (EMI) Scheme
 Under the approved EMI Scheme, certain employees hold options to subscribe for shares in the Company at prices ranging from 140p to 775p. 
Options are conditional on the employee completing three year’s service (the vesting period) and are exercisable three years from the grant date. 
The options have a contractual option term of seven years from the date they become exercisable. The Group has no legal or constructive obligation 
to repurchase or settle the options in cash. 
 2013 2013  2012 2012 
 Number  Weighted average Number Weighted average 
 of options  exercise price £ of options exercise price £
At 1 July 182,657 3.00 258,557 2.69
Forfeited in the year (10,804) 7.75 - -
Exercised in the year (73,100) 2.61 (75,900) 1.94
At 30 June 98,753 2.77 182,657 3.00
 
The number of share options outstanding at the reporting date was as follows:
   2013 2012 
Scheme year (grant date) Exercise price (p) Vesting period Number of options Number of options
2005 140.0 2008 - 2015 - 6,000
2005 155.5 2008 - 2015 25,000 31,000
2006 215.0 2009 - 2016 23,500 29,350
2007 290.5 2010 - 2017 42,150 97,400
2010 775.0 2013 - 2020 8,103 18,907
All years   98,753 182,657
 
(b) Long Term Incentive Scheme (LTIS) 
The Company has made annual awards under the LTIS to executive directors and other senior executives. The conditional awards, which vest three 
years after the grant date, are subject to the satisfaction of specified performance criteria, measured over a three year performance period. All such 
conditional awards are made at the discretion of the Remuneration Committee.
  2013 2012 
  Number of options Number of options
At 1 July  128,343 37,959
Granted in the year  78,954 94,005
Forfeited in the year  (1,684) (3,621)
At 30 June  205,613 128,343 Annual Report & Accounts 2013 Brooks Macdonald Group plc
50
Notes to the consolidated financial statements 
24. Equity settled share-based payments (continued)
The number of share options outstanding at the reporting date was as follows:
   2013 2012 
Scheme year (grant date) Exercise price (p) Vesting period Number of options Number of options
2010 nil 2013 33,848 34,338
2011 nil 2014 92,811 94,005
2012 nil 2015 78,954 -
All years   205,613 128,343
 
(c) Employee Benefit Trust (EBT)
Brooks Macdonald Group plc established an Employee Benefit Trust (‘the Trust’) on three December 2010. The Trust was established to acquire 
ordinary shares in the Company to satisfy rights to purchase shares on the exercise of options awarded under the LTIS. All finance costs and 
administration expenses connected with the Trust are charged to consolidated statement of comprehensive income as they accrue. The Trust has 
waived its rights to dividends. The following table shows the number of shares held by the Trust that have not yet vested unconditionally. 
  2013 2012 
  Number of shares Number of shares
At 1 July  151,139 37,959
Acquired in the year  61,033 113,180
At 30 June  212,172 151,139
 
(d) Employee Sharesave Scheme
Under the scheme, employees can contribute up to £250 a month over a three year period to acquire shares in the Company. At the end of the 
savings period, employees can elect to receive shares or receive their savings in cash.
 2013 2013  2012 2012 
 Number  Weighted average Number Weighted average 
 of options  exercise price £ of options exercise price £
At 1 July 180,566 8.33 196,171 5.78
Granted in the year 39,489 11.72 54,231 10.54
Forfeited in the year (13,547) 9.54 (6,407) 7.73
Exercised in the year (59,185) 5.54 (63,429) 2.40
At 30 June 147,323 10.23 180,566 8.33
 
The number of share options outstanding at 30 June 2013 was as follows:
   2013 2012 
Scheme year (grant date) Exercise price (p) Vesting period Number of options Number of options
2009 240.0 2012 - 4,269
2010 578.0 2013 2,040 58,526
2011 916.0 2014 58,536 63,813
2012 1,054.0 2015 48,332 53,958
2013 1,172.0 2016 38,415 -
All years   147,323 180,566 Annual Report & Accounts 2013
51
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
25. Earnings per share
The directors believe that adjusted earnings per share provide a truer reflection of the Group’s performance for the period. Adjusted earnings per 
share are shown below and are calculated based on ‘adjusted earnings’, representing earnings before the costs of acquiring subsidiary companies 
during the period (note 5).
  2013 2012 
  £’000 £’000
Profit for the year  8,030 6,256
Costs of acquiring subsidiary companies  1,047 -
Adjusted earnings attributable to ordinary shareholders  9,077 6,256
 
The weighted average number of shares in issue during the year was as follows: 
  2013 2012* 
  Number of shares  Number of shares
Weighted average number of shares in issue during the year  12,210,418 10,893,468
Dilutive shares issuable on exercise of share options  111,793 162,633
Diluted weighted average number of shares in issue during the year  12,322,211 11,056,101
 
Basic and diluted earnings per share based on both reported and adjusted earnings are shown in the table below:
  2013 2012* 
  p  p
Based on reported earnings:  
Basic earnings per share  65.76 57.43
Diluted earnings per share  65.16 56.58
Based on adjusted earnings:  
Basic earnings per share  74.33 57.43
Diluted earnings per share  73.66 56.58
* The comparative weighted average number of shares in issue and therefore basic and diluted earnings per share have been restated for the effect of shares issued at a 
discount to their market value as part of the Spearpoint acquisition.
26. Lease commitments
The Group leases various office premises under non-cancellable operating lease arrangements. The future aggregate minimum lease payments under 
these leases are as follows:
  2013 2012 
  £’000 £’000
Within one year  1,162 813
Second to fifth years inclusive  2,240 1,720
After five years  38 - Annual Report & Accounts 2013 Brooks Macdonald Group plc
52
27. Client funds under management
The Group holds client money and assets on behalf of clients in accordance with the client money rules of the Financial Conduct Authority. Such 
money and the corresponding liabilities to clients are not shown in the consolidated statement of financial position as the Group is not beneficially 
entitled thereto. The total market value of client money and assets held is shown below: 
  2013 2012 
  £’000 £’000
Client money bank accounts  595,365 479,000
Client assets under management  4,514,635 3,041,000
Total client funds under management  5,110,000 3,520,000
28. Financial risk management
The Group has identified the financial risks arising from its activities and has established policies and procedures as part of a formal structure for managing 
risk, including establishing risk lines, reporting lines, mandates and other control procedures. The structure is reviewed regularly. The Group does not use 
derivative financial instruments for risk management purposes.
(a) Liquidity risk
Liquidity risk is the risk that the Group is unable to meet its payment obligations associated with its financial liabilities when they fall due.
The primary objective of the Group’s treasury policy is to manage short-term liquidity requirements and to ensure that the Group maintains a surplus of 
immediately realisable assets over its liabilities, such that all known and potential cash obligations can be met.
The table below shows the cash inflows and outflows from the Group under non-derivative financial assets and liabilities, together with cash and bank 
balances available on demand.
   After three months After one year 
  Not more than but not more  but less than 
 On demand three months than one year five years Total 
At 30 June 2013 £’000 £’000 £’000 £’000 £’000
Cash flows from financial assets   
Available for sale financial assets - - - 1,582 1,582
Cash and balances at bank 18,440 - - - 18,440
Trade receivables - 5,159 - - 5,159
Other receivables - - 107 - 107
 18,440 5,159 107 1,582 25,288
Cash flows from financial liabilities     
Trade payables - 2,631 - - 2,631
Other financial liabilities - 10,609 1,928 5,929 18,466
 - 13,240 1,928 5,929 21,097
Net liquidity gap 18,440 (8,081) (1,821) (4,347) 4,191
Notes to the consolidated financial statements  Annual Report & Accounts 2013
53
Brooks Macdonald Group plc
Notes to the consolidated financial statements 
28. Financial risk management (continued)
(a) Liquidity risk (continued)
   After three months After one year 
  Not more than but not more  but less than 
 On demand three months than one year five years Total 
At 30 June 2012 £’000 £’000 £’000 £’000 £’000
Cash flows from financial assets     
Available for sale financial assets - - - 1,657 1,657
Cash and balances at bank 13,470 - - - 13,470
Trade receivables - 1,719 - - 1,719
Other receivables - - 115 - 115
 13,470 1,719 115 1,657 16,961
Cash flows from financial liabilities     
Trade payables - 2,699 - - 2,699
Other financial liabilities - 9,869 2,231 1,376 13,476
 - 12,568 2,231 1,376 16,175
Net liquidity gap 13,470 (10,849) (2,116) 281 786
 
(b)  Market risk
Interest rate risk 
The Group may elect to invest surplus cash balances in short-term cash deposits with maturity dates not exceeding three months. Consequently, the 
Group has a limited exposure to interest rate risk due to fluctuations in the prevailing level of market interest rates.
A 1% fall in the average monthly interest rate receivable on the Group’s cash and cash equivalents would have the impact of reducing interest 
receivable and therefore profit before taxation by £184,000 (2012: £135,000). An increase of 1% would have an equal and opposite effect.
Foreign exchange risk
The Group does not have any material exposure to transactional foreign currency risk and therefore no analysis of foreign exchange risk is provided.
Price risk
Price risk is the risk that the fair value of the future cash flows from financial instruments will fluctuate due to changes in market prices (other than 
those arising from interest rate risk or currency risk). The Group is exposed to price risk through its holdings of equity securities that are measured at 
fair value in the consolidated statement of financial position (note 13). A 1% fall in the value of these equity securities would have the impact of 
reducing other comprehensive income by £12,000. An increase of 1% would have an equal and opposite effect. Annual Report & Accounts 2013 Brooks Macdonald Group plc
54
28. Financial risk management (continued)
(c)  Credit risk
The Group may elect to invest surplus cash balances in highly liquid money market instruments with maturity dates not exceeding three months. 
The difference between the fair value and the net book value of these instruments is not material. To reduce the risk of a counterparty default, the 
Group deposits the rest of its funds in approved, high quality banks. At 30 June 2013 there was no significant concentration of credit risk in any 
particular counterparty (2012: none).
Assets exposed to credit risk recognised on the consolidated statement of financial position total £18,440,000 (2012: £13,489,000), being the 
Group’s total cash and cash equivalents.
Trade receivables with a carrying amount of £5,159,000 (2012: £1,719,000) are neither past due nor impaired. Trade receivables have no external 
credit rating as they relate to individual clients, although the value of investments held in each individual client’s portfolio is always in excess of the 
total value of the receivable. All trade receivables fall due within three months (2012: all).
29. Capital management
Capital is defined as the total of share capital, share premium, retained earnings and other reserves of the Company. Total capital at 30 June 2013 
was £57,560,000 (2012: £23,710,000). Regulatory capital is derived from the group Internal Capital Adequacy Assessment Process (ICAAP), which is 
a requirement of the Capital Requirements Directive. The ICAAP draws on the Group’s risk management process which is embedded within the 
individual businesses, function heads and executive committees within the Group.
The Group’s objectives when managing capital are to comply with the capital requirements set by the Financial Conduct Authority, to safeguard the 
Group’s ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders and to 
maintain a strong capital base to support the development of the business.
Capital adequacy and the use of regulatory capital are monitored daily by the Group’s management. The Group’s 2013 ICAAP was approved in May 
2013. There have been no capital requirement breaches during the year. Brooks Macdonald Group plc’s Pillar III disclosure is presented on our 
website at www.brooksmacdonald.com.
30. Guarantees and contingent liabilities
The Company has an agreement with the Royal Bank of Scotland plc to guarantee settlement for trading with CREST stock on behalf of clients. The 
Group holds client assets to fund such trading activity.
Additional levies by the Financial Services Compensation Scheme may give rise to further obligations based on the Group’s income in the current or 
previous years. Nevertheless, the ultimate cost to the Group of these levies remains uncertain and is dependent upon future claims resulting from 
institutional failures.
Notes to the consolidated financial statements  Annual Report & Accounts 2013
55
Brooks Macdonald Group plc
31. Related party transactions
Certain directors have taken advantage of the Group’s interest free season ticket loan facility which is available to all employees. The directors who 
have such loans are as follows:
  Loan balance  Loan balance  Maximum amount Maximum amount 
 2013 2012 2013 2012 
Director £’000 £’000 £’000 £’000
N I Holmes 1 1 2 2
S J Jackson 5 4 10 8
 
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation. The Company’s individual 
financial statements include the amounts attributable to subsidiaries. These amounts have been disclosed in aggregate in the relevant Company 
financial statements and in detail in the following table:
 Amounts owed by  Amounts owed by Amounts owed to Amounts owed to 
 related parties  related parties  related parties related parties 
 2013 2012 2013 2012 
 £’000 £’000 £’000 £’000
Braemar Group Limited 2,150 2,150 - -
Brooks Macdonald Financial Consulting Limited 955 1,579 - -
Brooks Macdonald Asset Management Limited - - 17,018 14,391
Brooks Macdonald Nominees Limited - - 2,727 1,869
 
All of the above amounts are interest free and, with the exception of the subordinated loan to Braemar Group Limited, are repayable on demand.
The Group manages a number of collective investment funds that are considered related parties. Available for sale financial assets include (note 13) 
an investment of 1,426,793.64 B shares in Braemar PCC Limited Student Accommodation Cell. This transaction was conducted on an arms length 
basis at market value.
32. Events since the end of the year
No material events have occurred between the reporting date and the date of signing the Annual Report & Accounts.
Notes to the consolidated financial statements  Annual Report & Accounts 2013 Brooks Macdonald Group plc
56
Independent auditor’s report 
to the members of Brooks Macdonald Group plc
We have audited the parent company financial statements of Brooks 
Macdonald Group plc for the year ended 30 June 2013 which comprise 
the Company Balance Sheet and the related notes. The financial 
reporting framework that has been applied in their preparation is 
applicable law and United Kingdom Accounting Standards (United 
Kingdom Generally Accepted Accounting Practice).
Respective responsibilities of directors and auditors
As explained more fully in the statement of directors’ responsibilities set 
out on page 19, the directors are responsible for the preparation of the 
parent company financial statements and for being satisfied that they 
give a true and fair view. Our responsibility is to audit and express an 
opinion on the parent company financial statements in accordance with 
applicable law and International Standards on Auditing (UK and Ireland). 
Those standards require us to comply with the Auditing Practices Board’s 
Ethical Standards for Auditors.
This report, including the opinions, has been prepared for and only for 
the Company’s members as a body in accordance with Chapter 3 of Part 
16 of the Companies Act 2006 and for no other purpose. We do not, in 
giving these opinions, accept or assume responsibility for any other 
purpose or to any other person to whom this report is shown or into 
whose hands it may come save where expressly agreed by our prior 
consent in writing.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures 
in the financial statements sufficient to give reasonable assurance that 
the financial statements are free from material misstatement, whether 
caused by fraud or error. This includes an assessment of: whether the 
accounting policies are appropriate to the parent company’s 
circumstances and have been consistently applied and adequately 
disclosed; the reasonableness of significant accounting estimates made 
by the directors; and the overall presentation of the financial statements. 
In addition, we read all the financial and non-financial information in the 
Annual Report & Accounts to identify material inconsistencies with the 
audited financial statements. If we become aware of any apparent 
material misstatements or inconsistencies we consider the implications 
for our report.
Opinion on financial statements
In our opinion the parent company financial statements:
•  give a true and fair view of the state of the Company’s affairs as at 
30 June 2013;
•  have been properly prepared in accordance with United Kingdom 
Generally Accepted Accounting Practice; and 
•  have been prepared in accordance with the requirements of the 
Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Report of the Directors for 
the financial year for which the parent company financial statements are 
prepared is consistent with the parent company financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where 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.
Other matter 
We have reported separately on the group financial statements of Brooks 
Macdonald Group plc for the year ended 30 June 2013.
Marcus Hine (Senior Statutory Auditor)  
for and on behalf of PricewaterhouseCoopers LLP 
Chartered Accountants and Statutory Auditors
London
10 September 2013 Annual Report & Accounts 2013
57
Brooks Macdonald Group plc
Company balance sheet 
as at 30 June 2013 
  2013 2012
 Note £’000  £’000  £’000 £’000
Fixed assets
Investments 36  46,631  11,863
Current assets     
Debtors 37 7,127  7,739 
Cash at bank and in hand  10,274  7,893 
Total current assets  17,401  15,632 
     
Creditors: amounts falling due within one year 38 (25,290)  (21,723) 
     
Net current liabilities   (7,889)  (6,091)
Total assets less current liabilities   38,742  5,772
Creditors: amounts falling due after more than one year 39  (4,482)  -
Net assets   34,260  5,772
     
Financed by:     
 
Capital and reserves
Called up share capital 40  133  109
Share premium account 40  31,868  4,423
Share option reserve 41  3,023  1,912
Revaluation reserve 41  63  94
Profit and loss account 41  (827)  (766)
Total shareholders’ funds 42  34,260  5,772
The Company financial statements were approved by the Board of Directors and authorised for issue on 10 September 2013, signed on their 
behalf by:
C A J Macdonald  S J Jackson 
Chief Executive  Finance Director
Company Registration Number: 4402058
The accompanying notes from pages 58 to 62 form an integral part of the Company financial statements.
  Annual Report & Accounts 2013 Brooks Macdonald Group plc
58
Notes to the company financial statements
33. Principal accounting policies
The general accounting policies applied in the preparation of these financial statements are set out below. These policies have been applied 
consistently to all years presented, unless otherwise stated.
(a) Basis of preparation
  The Company’s financial statements are prepared in accordance with in accordance with the Companies Act 2006 and applicable accounting 
standards in the United Kingdom. The financial statements have been prepared on the historical cost basis, except for the revaluation of 
investments such that they are measured at their fair value.
  At the time of approving the financial statements, the directors have a reasonable expectation that the Company has adequate resources to 
continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the 
financial statements.
(b) Investments in subsidiary companies
 Investments in subsidiaries are recognised at cost less provisions for impairment.
(c) Share-based payments
  The Company has applied the requirements of FRS 20 Share-based payments and has adopted the requirements of UITF 44. Equity settled 
share-based payments are measured at fair value at the grant date and the charge to the Profit and Loss Account is recognised on a straight line 
basis over the period in which the related services are provided, based on the number of shares that are expected to vest.
(d) Operating lease payments
  Rent payments due under operating leases are charged to the Profit and Loss Account on a straight line basis over the term of the lease.  
The Company benefited from a rent-free period under the terms of its current property lease. In accordance with UITF 28 Operating Leases 
Incentives, the benefit is allocated over the shorter of the lease term and the date of the market rent review specified in the lease. During the 
rent-free period a rental charge has been recognised in the Profit and Loss Account and accrued as a liability in the Balance Sheet.
(e) Retirement benefit costs
  Contributions in respect of the Group’s defined contribution pension scheme are charged to the Profit and Loss Account as they fall due.
(f) Employee Benefit Trust (EBT)
  Where the Company holds its own equity shares through an EBT these shares are shown as a reduction in shareholders’ equity. Any consideration 
paid or received for the purchase or sale of these shares is shown as a reduction in the reconciliation of movements in shareholders’ funds. No gain 
or loss is recognised in the profit and loss account or the statement of total recognised gains or losses on the purchase, sale, issue or cancellation of 
these shares.
(g) Other investments
  Other listed investments are re-valued each reporting period to their fair value according to the most recently available market information.
34. Profit for the year 
As permitted by Section 408 of the Companies Act 2006 the Company has elected not to present its own profit and loss account for the financial 
year. Brooks Macdonald Group plc reported profit after tax for year ended 30 June 2013 of £2,902,000 (2012: £1,654,000). Auditors’ remuneration 
is disclosed in note 5 of the consolidated financial statements. The average monthly number of employees during the year was 9 (2012: 11). 
Directors’ emoluments are set out in note 6 of the consolidated financial statements. 
35. Dividends
Details of the Company’s dividends paid and proposed, subject to approval at the Annual General Meeting, are set out in note 10 of the consolidated 
financial statements.  Annual Report & Accounts 2013
59
Brooks Macdonald Group plc
Notes to the company financial statements
36. Investments
 Group undertakings Listed investments Total 
Net book value £’000 £’000 £’000
At 1 July 2011 9,567 1,561 11,128
Additions:   
   – Share options 702 - 702
Revaluation - 33 33
At 30 June 2012 10,269 1,594 11,863
Additions:   
   – Share options 1,111 - 1,111
   – Acquisition of subsidiary 33,669 - 33,669
Revaluation - (12) (12)
At 30 June 2013 45,049 1,582 46,631
Listed investments represent the Company’s holding of 1,426,793.64 B shares in Braemar Group PCC Limited Student Accommodation Cell. The 
fund is managed by Brooks Macdonald Funds Limited, a subsidiary of the Company. Trading is currently suspended on this fund, however the fund 
manager continues to publish a price based on the fair value of the underlying assets of the fund. At 30 June 2013, the investment was re-valued to 
its fair value of £1,582,000 (2012: £1,594,000), representing a loss during the year of £12,000 (2012: gain of £33,000).
Investments in group undertakings are recorded at cost, which is the fair value of the consideration paid to acquire the Company’s subsidiaries. 
Additions to group undertakings of £1,111,000 (2012: £702,000) represent the cost of share options issued during the year in accordance with 
FRS20. Additions on acquisition of subsidiaries of £33,669,000 (2012: £nil) represent the cost of the Company’s investment in Brooks Macdonald 
Asset Management (International) Limited and Brooks Macdonald Retirement Services (International) Limited. Details of the Company’s subsidiary 
undertakings as at 30 June 2013, all of which were wholly owned and included in the consolidated financial statements, are shown below:
 Type of share Country of Nature of 
Company and par value incorporation business
Braemar Group Limited Ordinary 1p UK Investment management
Brooks Macdonald Asset Management Limited Ordinary £1 UK Investment management
Brooks Macdonald Asset Management (International) Limited Ordinary £1 Channel Islands Investment management
Brooks Macdonald Asset Management (Tunbridge Wells) Limited Ordinary £1 UK Non-trading
Brooks Macdonald Financial Consulting Limited Ordinary 5p UK Financial consulting
Brooks Macdonald Investment Services Limited Ordinary £1 UK Dormant
Brooks Macdonald Nominees Limited Ordinary £1 UK Nominee services
Brooks Macdonald Retirement Services (International) Limited Ordinary £1 Channel Islands Retirement planning
Brooks Macdonald Tax Services Limited Ordinary £1 UK Dormant
JPAM Limited Ordinary £1 UK Non-trading
    Annual Report & Accounts 2013 Brooks Macdonald Group plc
60
Notes to the company financial statements
37. Debtors
  2013 2012 
  £’000 £’000
Amounts owed by subsidiary undertakings  7,105 7,729
Other debtors  22 10
Total debtors  7,127 7,739
Amounts owed by subsidiary companies are unsecured, interest free and, with the exception of the subordinated loan to Braemar Group Limited, are 
repayable on demand.
38. Creditors: amounts falling due within one year
  2013 2012 
  £’000 £’000
Trade creditors  30 8
Amounts owed to subsidiary undertakings  23,747 20,260
Deferred tax  19 -
Accruals  1,374 1,455
Other creditors  120 -
Total creditors due within one year  25,290 21,723
Amounts owed to subsidiary companies are unsecured, interest free and are repayable on demand.
39. Creditors: amounts falling due after more than one year
The creditors balance of £4,482,000, falling due after more than one year, relates to the directors’ best estimate of the deferred consideration 
payable in respect of the client relationships and subsidiary undertakings that were acquired by the Company. Deferred consideration is measured at 
its fair value based on the discounted expected future cash flows.
40. Called up share capital and share premium account
The movements in share capital and share premium during the year were as follows:
    Share premium  
 Number of  Share capital account Total 
 shares  £ ’000  £ ’000 £’000
At 1 July 2011 10,788,167 108 4,125 4,233
Shares issued 139,329 1 298 299
At 30 June 2012 10,927,496 109 4,423 4,532
Shares issued 2,420,478 24 27,445 27,469
At 30 June 2013 13,347,974 133 31,868 32,001
The total number of ordinary shares, issued and fully paid at 30 June 2013 was 13,347,974 (2012: 10,927,496) with a par value of 1p per share. 
Excluding 212,172 (2012: 151,139) treasury shares held by the EBT, the Company had 13,135,802 (2012: 10,776,357) ordinary 1p shares in issue 
as at 30 June 2013. Annual Report & Accounts 2013
61
Brooks Macdonald Group plc
Notes to the company financial statements
40. Called up share capital and share premium account (continued)
Long Term Incentive Scheme (LTIS)
The Group established an Employee Benefit Trust (EBT) on 3 December 2010 to acquire ordinary shares in the Company to satisfy awards under the 
Group’s LTIS and other share-based payment schemes (note 24). At 30 June 2013, the EBT held 212,172 (2012: 151,139) 1p ordinary shares in the 
Company, acquired for a total consideration of £2,544,000 (2012: £1,765,000). The market value of these shares was £3,044,668 (2012: £1,738,000). 
They are presented as treasury shares in the consolidated financial statements and their cost has been deducted from retained earnings within 
shareholders’ equity.
The Company has made annual awards under the LTIS to executive directors and other senior executives. The conditional awards, which vest three 
years after the grant date, are subject to the satisfaction of specified performance criteria, measured over a three year performance period. All such 
conditional awards are made at the discretion of the remuneration committee.
41. Reserves
  2013 2012 
  £’000 £’000
Share option reserve   
At beginning of the year  1,912 1,210
Share-based payments  1,111 702
At end of the year  3,023 1,912
Revaluation reserve   
At beginning of the year  94 61
Revaluation of available for sale investments  (9) 33
Deferred tax on revaluation  (22) -
At end of the year  63 94
Profit and loss account   
At beginning of the year  (766) 89
Profit for the financial year  2,902 1,654
Dividends paid  (2,184) (1,724)
Purchase of own shares  (779) (785)
At end of the year  (827) (766) Annual Report & Accounts 2013 Brooks Macdonald Group plc
62
Notes to the company financial statements
42. Reconciliation of movements in total shareholders’ funds
  2013 2012 
  £’000 £’000
Profit for the financial year  2,902 1,654
Revaluation of investments  (31) 33
Total recognised gains and losses for the financial year  2,871 1,687
  
Dividends paid  (2,184) (1,724)
Share-based payments  1,111 702
Issue of new shares  27,469 299
Purchase of own shares by EBT  (779) (785)
Net additions to shareholders’ funds  28,488 179
  
Opening shareholders’ funds  5,772 5,593
Closing shareholders’ funds  34,260 5,772
43. Lease commitments
The Company leases office premises under non-cancellable operating lease arrangements. The future aggregate minimum lease payments under 
these leases are as follows:
  2013 2012 
  £’000 £’000
Within one year  908 734
Second to fifth years inclusive  1,626 1,464
After five years  38 -
44. Related party transactions
The Company has applied the exemption available under FRS 8 in electing not to disclose transactions and balances with its wholly owned subsidiary 
companies. Details of related party transactions with directors are detailed in note 31 of the consolidated financial statements.
  Annual Report & Accounts 2013
63
Brooks Macdonald Group plc
Explanation of Annual General Meeting business
Enclosed with this document is a notice convening the Annual General 
Meeting of the Company for 17 October 2013. This explanatory note 
gives further information on resolutions numbered 2 to 10 set out in the 
notice of Annual General Meeting.
Resolution 2 – To declare a final dividend
The directors recommend a final dividend of 16 pence per ordinary 
share. Subject to approval by shareholders, the final dividend will be 
paid on 18 October 2013 to shareholders on the register on  
20 September 2013.
Resolutions 3 to 5 – To re-elect certain of the directors
The Company’s articles of association state that one third of the 
directors (or the nearest whole number closest to one third) must retire 
from office at each Annual General Meeting and offer themselves for 
re-election. In addition, any director who has been in office for more 
than three years since their last appointment or re-appointment should 
also retire and offer themselves for re-election. Christopher Macdonald, 
Christopher Knight and Colin Harris are therefore offering themselves for 
re-election on this basis.
Information on each of the directors standing for re-election is set out 
below. The Board confirms that each of the directors offering themselves 
for re-election has extensive relevant experience of the Group and its 
business. The Board is therefore of the opinion that all such persons 
should be re-elected to the Board.
Christopher Macdonald (52) is the Chief Executive of the Group. He is 
a qualified investment manager and was a founding director of the 
Company in 1991. Chris has worked in investment management and 
financial services since the start of his career in 1982 and has won 
several investment management awards.
Chris is also the non-executive director of the Invesco AiM VCT and an 
associate of the Institute of Continuing Professional Development.
Christopher Knight (67) has been a non-executive director of Brooks 
Macdonald Group since 2002; he was appointed Chairman in 2005.
A chartered accountant, Chris was an investment banker for nearly 30 
years, for much of that time with Morgan Grenfell and, following its 
takeover, with Deutsche Bank. He has extensive corporate finance 
experience gained during his banking career in London, New York and 
Hong Kong.
He is a non-executive director of Intertek Group plc and of Powerflute Oyj.
Colin Harris (60) became a non-executive director of the Group in 
2010. Now retired from full time employment, Colin’s career culminated 
in a number of senior management roles at Newton Investment 
Management which included Chief Executive and Deputy Chairman.
He is a qualified solicitor and before joining Newton was the senior legal 
counsel at international insurance brokers Alexander & Alexander Inc 
(now part of Aon).
A copy of each service contract is available for inspection at the 
Registered Office of the Company and will be available for inspection at 
the Annual General Meeting.
Resolution 6 – To appoint PricewaterhouseCoopers LLP as auditors
This Resolution proposes that PricewaterhouseCoopers LLP should be 
appointed as the Company’s auditors and authorises the directors to 
determine their remuneration.
Resolution 7 – Authority to allot shares
The Companies Act 2006 prevents directors from allotting unissued 
shares without the authority of shareholders in general meeting. In 
certain circumstances this could be unduly restrictive. The directors’ 
existing authority to allot shares, which was granted at the Annual 
General Meeting held in 2012, will expire at the end of this year’s 
Annual General Meeting.
Resolution 7 in the notice of Annual General Meeting will be proposed, as 
an ordinary resolution, to authorise the directors to allot ordinary shares of 
1 pence each in the capital of the Company up to a maximum nominal 
amount of £44,490 (ie up to 4,449,000 ordinary shares) representing 
approximately 33% of the ordinary shares in issue on 10 September 
2013. The Company does not currently hold any shares in treasury.
The authority conferred by this resolution will expire on the date which 
is fifteen months after the passing of this resolution or, if sooner, at the 
end of next year’s Annual General Meeting.
Resolution 8 – To disapply pre-emption rights
Unless they are given an appropriate authority by shareholders, if the 
directors wish to allot any of the unissued shares for cash or grant rights 
over shares or sell treasury shares for cash (other than pursuant to an 
employee share scheme) they must first offer them to existing 
shareholders in proportion to their existing holdings. This is known as 
pre-emption rights. Annual Report & Accounts 2013 Brooks Macdonald Group plc
64
Explanation of Annual General Meeting business
The existing disapplication of these statutory pre-emption rights, which 
was granted at the Annual General Meeting held in 2012, will expire at 
the end of this year’s Annual General Meeting. Accordingly, Resolution 8 
in the notice of Annual General Meeting will be proposed, as a special 
resolution, to give the directors power to allot shares without the 
application of these statutory pre-emption rights: first, in relation to offers 
of equity securities by way of rights issue, open offer or similar 
arrangements; and second, in relation to the allotment of equity securities 
for cash up to a maximum aggregate nominal amount of £13,340 (ie up 
to 1,334,000 ordinary shares) representing approximately 10% of the 
ordinary shares in issue on 10 September 2013.
The authority sought and limits set by this resolution will also apply to a 
sale by the Company of any shares it holds as treasury shares. The 
Treasury Share Regulations allow shares purchased by the Company out 
of distributable profits to be held as treasury shares, which may then be 
cancelled, sold for cash or used to meet the Company’s obligations 
under its employee share based incentive schemes. Any subsequent 
transfers of treasury shares by the Company to satisfy the requirements 
of employee share-based incentive schemes will be counted towards the 
anti-dilution limits for such share issues to the extent required by the 
Association of British Insurers guidelines.
The power conferred by this resolution will expire on the date which 
falls fifteen months after the passing of this resolution or, if sooner, at 
the end of next year’s Annual General Meeting.
Resolution 9 – Company’s authority to purchase its own shares
Resolution 9 in the notice of Annual General Meeting, which will be 
proposed as a special resolution, will authorise the Company to make 
market purchases of up to 1,334,000 ordinary shares. The existing 
authority to make market purchases of ordinary shares, which was 
granted at the Annual General Meeting held in 2012, will expire at the 
end of this year’s Annual General Meeting.
The number of ordinary shares stated in this resolution equals 
approximately 10% of the Company’s ordinary shares in issue on 10 
September 2013. The minimum price that may be paid is the nominal 
value of an ordinary share (ie 1 pence), and the maximum price shall 
not exceed 5% above the average of the middle market quotations for 
an ordinary share for the five business days before each purchase is 
made (exclusive of expenses).
The authority conferred by this resolution will expire on the date which 
falls 15 months after the passing of this resolution or, if sooner, at the 
end of next year’s Annual General Meeting.
The directors are committed to managing the Company’s capital 
effectively. Although the directors have no plans to make such 
purchases, buying back the Company’s ordinary shares is one of the 
options they keep under review. Purchases would only be made after 
considering the effect on earnings per share, and the benefits for 
shareholders generally.
The Company may hold in treasury any of its own shares that it purchases 
pursuant to the Treasury Share Regulations and the authority conferred by 
this resolution. This would give the Company the ability to re-issue 
treasury shares quickly and cost effectively and would provide the 
Company with greater flexibility in the management of its capital base.
Resolution 10 – Adoption of the Brooks Macdonald Group 
Company Share Option Plan
The Company is seeking approval for the establishment of the Brooks 
Macdonald Group Company Share Option Plan (the ‘CSOP’). The CSOP, 
which is intended to be approved by HM Revenue & Customs, is 
designed to help the Company incentivise and retain key employees in a 
way that is tax efficient and aligned with shareholders’ interests while 
being sensitive to the current economic and market environment. A 
summary of the main features of the CSOP is set out in the Appendix to 
this document. Annual Report & Accounts 2013
65
Brooks Macdonald Group plc
Explanation of Annual General Meeting business
Appendix
Summary of the principal terms of the Brooks Macdonald Group 
Company Share Option Plan (the ‘CSOP’)
Operation
The Remuneration Committee of the Board of Directors of the Company 
(the ‘Committee’) will supervise the operation of the CSOP.
Eligibility
The Company or the Trustee of the Company’s Employee Benefit Trust 
(the ‘Grantor’) may grant options over ordinary shares in the capital of 
the Company (‘Options’) to employees and directors of the Company 
and its subsidiaries.
Options
Options may normally only be granted within the period of 42 days after 
the CSOP receives formal approval from HMRC or the announcement of 
the Company’s results for any period. Options may also be granted within 
21 days after the falling away of any restrictions which prevented grants 
being made during such 42 day period. Options may be granted at other 
times in exceptional circumstances. It is intended that the first awards will 
be made shortly following the adoption of the CSOP .
The exercise price at which each share subject to the Option may be 
acquired will be set at the date of grant and will not be less than the 
market value of the share at that time.
An Option cannot be granted more than ten years after the CSOP 
receives formal approval from HMRC. 
No payment is required for the grant of an Option.
Options will vest, and become exercisable, on or shortly after the third 
anniversary of the date of grant subject normally to continued 
employment and the satisfaction of performance conditions (as further 
described below). 
Satisfaction of awards 
It is envisaged that ordinary shares required under the CSOP will 
generally be purchased in the market by the Company’s employee 
benefit trust, funded by the Company. However the Company may 
satisfy awards by issuing shares or transferring shares out of treasury, 
subject to the following dilution limits:
(i)  The number of ordinary shares required to be issued to satisfy the 
Options granted under the CSOP or any of the Company’s other 
employee share schemes in any rolling ten year period shall not 
exceed 15% of the Company’s issued share capital from time to time. 
(ii)  The number of ordinary shares required to be issued to satisfy the 
Options granted under the CSOP or any of the Company’s other 
discretionary employee share schemes in any rolling ten year period 
shall not exceed 10% of the Company’s issued share capital from 
time to time.
For the purpose of these limits, shares transferred from treasury shall be 
included until such time as the guidelines published by the ABI permit 
such shares to be excluded.
A participant may at any time hold Options over ordinary shares with a 
total market value, as at the date of grant, of no more than £30,000 (or 
the relevant statutory limit at the time of grant).
Performance conditions 
Any performance condition will be set by the Grantor at the time the 
Options are granted. Options granted to directors of the Company will 
be subject to performance conditions. However, the Grantor shall have 
discretion to grant Options without performance conditions to 
employees who are not directors. 
If events have occurred which cause the Grantor to consider that a 
performance condition in respect of an Option has become unfair or 
impractical, it may in its discretion amend waive or relax such condition 
so that it would represent an equivalent achievement to when it was 
originally imposed or last amended or relaxed, as the case may be.
The performance condition in respect of the first Options to be granted 
under the CSOP is that there must be an increase in the diluted earnings 
per share of the Company of 2% per annum more than the increase in 
the Retail Prices Index over the three financial years starting with the 
financial year in which the Option is granted.
Termination of employment 
Options held by participants who cease to be employed by a member of 
the Company’s group in circumstances in which they are “good leavers” 
will vest and be exercisable for a period of six months (or 12 months in 
the case of death) from cessation of employment, provided the 
performance condition (if any) has been satisfied (as measured over the 
shortened period). In such a circumstance, there will be a pro-rata 
reduction in the size of the Option corresponding to the proportion of 
the vesting period which has elapsed (unless the Committee determines 
that it would be inappropriate to apply a pro-rata reduction). Annual Report & Accounts 2013 Brooks Macdonald Group plc
66
Explanation of Annual General Meeting business
Appendix
A “good leaver” is a person who ceases to be an employee of a member 
of the Company’s group by reason of injury, disability or redundancy 
(within the meaning of the Employment Rights Act 1996), retirement, 
the employing company ceasing to be a member of the Company’s 
group or the employing business being transferred outside the 
Company’s group.
Corporate events
In the event of a takeover, scheme of arrangement or winding up of the 
Company (other than in respect of an internal corporate reorganisation) 
all Options will vest early subject to: 
(i)  the extent that the performance condition (if any) has been 
satisfied at that time (measured over the shortened period); and
(ii)  the pro-rating of the Options to reflect the reduced period of time 
between their grant and vesting (although the Committee can 
decide not to pro-rate an Option if it regards it as inappropriate to 
do so in the particular circumstances). 
In the event of an internal corporate reorganisation, Options will be 
replaced by equivalent new options over shares in the new holding 
company and the new options will continue to vest in accordance with 
the rules of the CSOP.
Variation 
On any variation of the share capital of the Company, the number and 
nominal value of any ordinary shares comprised in an Option may be 
varied in such manner as the Committee may in its absolute discretion 
determine to be fair and reasonable.
Rights attaching to shares
Any ordinary shares issued or transferred when an Option is exercised 
will rank equally with the ordinary shares then in issue (except for rights 
arising by reference to an earlier record date).
Assignment 
Options granted under the CSOP shall not be transferable or assignable.
Amendment 
The Committee may amend the CSOP in any way it thinks fit save that:
(i) the provisions relating to:
 (a) the persons to whom Options can be granted;
 (b) the limitations on the number of shares subject to Options;
 (c) the maximum entitlement for any one participant; and
 (d)  adjustments to be made in the event of a variation in the 
share capital of the Company;
cannot be altered to the advantage of a participant without the prior 
approval of shareholders in general meeting (save for minor 
amendments to benefit the administration of the CSOP, to take account 
of any change in legislation or to obtain or maintain favourable tax, 
exchange control or regulatory treatment for participants, the Company 
or its subsidiaries); and
(ii)  no amendment shall be made which would alter adversely any of 
the existing rights of a participant unless the amendment is made 
either with the consent of the participant or required by law.
General 
Benefits under the CSOP will not be pensionable. Annual Report & Accounts 2013
67
Brooks Macdonald Group plc
Notice of Annual General Meeting 
Company Registration number: 4402058
Notice is given that the Annual General Meeting of Brooks Macdonald 
Group plc (the ‘Company’) will be held at 111 Park Street, London, W1K 
7JL on Thursday 17 October 2013 at 9.30 am. for the following purposes.
Ordinary business
To resolve as ordinary resolutions:
1  To receive and consider the accounts and reports of the directors 
and the auditors for the year ended 30 June 2013.
2  To declare a final dividend of 16 pence per ordinary share for the 
year ended 30 June 2013.
3 To re-elect Christopher Macdonald as a director.
4 To re-elect Christopher Knight as a director.
5 To re-elect Colin Harris as a director.
6  To appoint PricewaterhouseCoopers LLP as the Company’s auditors 
and to authorise the directors to determine their remuneration.
Special business
Directors’ authority to allot shares
To resolve as an ordinary resolution:
7  That the directors be generally and unconditionally authorised 
pursuant to section 551 of the Companies Act 2006 (the ‘Act’) to 
exercise all the powers of the Company to allot shares in the 
Company and to grant rights to subscribe for, or to convert any 
security into, shares in the Company (‘Relevant Securities’), up to a 
maximum aggregate nominal amount of £44,490, for a period 
expiring (unless previously revoked, varied or renewed) on the date 
which is 15 months after the passing of this resolution or, if sooner, 
the end of the next Annual General Meeting of the Company. 
However, in each case the Company may, before such expiry, make 
an offer or agreement which would or might require Relevant 
Securities to be allotted after this authority expires and the directors 
may allot Relevant Securities in pursuance of such offer or 
agreement as if this authority had not expired.
  All previous unutilised authorities given to the directors pursuant to 
section 551 of the Act shall cease to have effect at the conclusion of 
the Annual General Meeting, save to the extent that those 
authorities are exercisable pursuant to section 551(7) of the Act by 
reason of any offer or agreement made prior to the date of this 
resolution which would or might require shares to be allotted or 
rights to be granted on or after that date.
Disapplication of pre-emption rights
To resolve as a special resolution:
8  That, subject to the passing of resolution 7 above, the directors be 
generally empowered pursuant to sections 570 and 573 of the Act 
to allot equity securities (within the meaning of section 560 of the 
Act) for cash, pursuant to the authority conferred by resolution 7, 
as if section 561 of the Act did not apply to such allotment, 
provided that this power shall expire on the date which is 15 
months after the passing of this resolution or, if sooner, the end of 
the next Annual General Meeting of the Company. This power shall 
be limited to the allotment of equity securities:
 8.1  in connection with an offer of equity securities (including, 
without limitation, under a rights issue, open offer or similar 
arrangement) in favour of holders of ordinary shares in the 
capital of the Company in proportion (as nearly as may be 
practicable) to their existing holdings of ordinary shares but 
subject to such exclusions or other arrangements as the 
directors deem necessary or expedient in relation to fractional 
entitlements or any legal, regulatory or practical problems 
under the laws of any territory, or the requirements of any 
regulatory body or stock exchange; and 
 8.2  otherwise than pursuant to paragraph 8.1 up to an aggregate 
nominal amount of £13,340; but the Company may, before 
such expiry, make an offer or agreement which would or might 
require equity securities to be allotted after this power expires 
and the directors may allot equity securities in pursuance of 
such offer or agreement as if this power had not expired. 
    This power applies in relation to a sale of shares which is an 
allotment of equity securities by virtue of section 560(2)(b) 
of the Act as if in the first paragraph of this resolution the 
words “pursuant to the authority conferred by resolution 7” 
were omitted.
    All previous unutilised powers given to the directors pursuant 
to sections 570 and 573 of the Act shall cease to have effect at 
the conclusion of this Annual General Meeting. Annual Report & Accounts 2013 Brooks Macdonald Group plc
68
Notice of Annual General Meeting 
Company’s authority to purchase its own shares
To resolve as a special resolution:
9  That the Company be generally authorised pursuant to section 701 
of the Act to make market purchases (within the meaning of section 
693(4) of the Act) of its ordinary shares of £0.01 each on such 
terms and in such manner as the directors shall determine, 
provided that:
 9.1  the maximum number of ordinary shares hereby authorised to 
be purchased is 1,334,000;
 9.2  the maximum price which may be paid for each ordinary 
share shall be 5% above the average of the middle market 
quotations for an ordinary share (as derived from The Stock 
Exchange Daily Official List) for the five business days 
immediately before the day on which the purchase is made 
(in each case exclusive of expenses);
 9.3  the minimum price which may be paid for each ordinary share 
shall be £0.01; and
 9.4  this authority (unless previously revoked, varied or renewed) 
shall expire on the date which is 15 months after the passing of 
this resolution or, if sooner, the end of the next Annual General 
Meeting of the Company, except in relation to the purchase of 
ordinary shares the contract for which was concluded before 
such date and which will or may be executed wholly or partly 
after such date.
Adoption of the Brooks Macdonald Group Company Share  
Option Plan
To resolve as an ordinary resolution:
10  That the Brooks Macdonald Group Company Share Option Plan 
(the ‘CSOP’), a copy of the draft rules of which is produced to the 
meeting initialled by the Chairman for the purposes of identification 
and the principal terms of which are summarised in the Appendix, 
be adopted, that such rules be and are hereby approved in the 
form of the draft subject to any amendments which may be 
required in order to obtain the approval of HM Revenue & Customs 
and that the directors be and are hereby authorised to do all acts 
and things which they may consider necessary or expedient for 
implementing, giving effect to and operating the CSOP .
By order of the Board
Simon Jackson 
Company Secretary
10 September 2013
Registered Office: 
111 Park Street, Mayfair, London W1K 7JL
  Annual Report & Accounts 2013
69
Brooks Macdonald Group plc
Notice of Annual General Meeting 
Notes:
Rights to appoint a proxy
1  Members of the Company are entitled to appoint a proxy to 
exercise all or any of their rights to attend and to speak and vote at 
a meeting of the Company. A proxy does not need to be a member 
of the Company. A member may appoint more than one proxy in 
relation to a meeting provided that each proxy is appointed to 
exercise the rights attached to a different share or shares held by 
that member.
2  A proxy form which may be used to make such appointment and 
give proxy directions accompanies this notice. If you do not receive 
a proxy form and believe that you should have one, or if you 
require additional proxy forms in order to appoint more than one 
proxy, please contact Capita Registrars Limited, PXS, 34 Beckenham 
Road, Kent BR3 4TU.
Procedure for appointing a proxy
3  To be valid, the proxy form must be received by post or (during 
normal business hours only) by hand at Capita Registrars Limited, 
PXS, 34 Beckenham Road, Kent BR3 4TU no later than 9.30 am. on 
Tuesday 15 October 2013. It should be accompanied by the power 
of attorney or other authority (if any) under which it is signed or a 
notarially certified (or certified by a solicitor with a current 
practising certificate) copy of such power or authority.
4  The return of a completed proxy form will not preclude a member 
from attending the Annual General Meeting and voting in person if 
he or she wishes to do so.
Record date
5  To be entitled to attend and vote at the Annual General Meeting 
(and for the purpose of the determination by the Company of the 
votes they may cast), members must be registered in the Register 
of Members of the Company at 6:00 pm on Tuesday 15 October 
2013 (or, in the event of any adjournment, at 6:00 pm on the day 
48 hours before the time of the adjourned meeting). Changes to 
the register of members after the relevant deadline will be 
disregarded in determining the right of any person to attend and 
vote at the meeting.
Corporate representatives
6  Any corporation which is a member can appoint one or more 
corporate representatives who may exercise on its behalf all of its 
powers as a member provided that they do not do so in relation to 
the same shares.
Other rights of members
7  Any member attending the meeting has the right to ask questions. 
The Company must cause to be answered any such question 
relating to the business being dealt with at the meeting but no 
such answer need be given if (a) to do so would interfere unduly 
with the preparation for the meeting or involve the disclosure of 
confidential information, (b) the answer has already been given on 
a website in the form of an answer to a question, or (c) it is 
undesirable in the interests of the Company or the good order of 
the meeting that the question be answered.
Documents available for inspection
8  There will be available for inspection at the Registered Office of the 
Company during normal business hours on any weekday 
(excluding Saturdays and public holidays) and at the place of the 
meeting for at least 15 minutes prior to and during the Annual 
General Meeting copies of:
 • the service contract of each executive director; and
 • the letter of appointment of each non-executive director.
   Annual Report & Accounts 2013
71
Brooks Macdonald Group plc Brooks Macdonald Group plc
Form of proxy
Annual General Meeting 17 October 2013 at 9.30am
Please read the notice of meeting and the explanatory notes below before completing this form.
I/We (see note 5)  Name
 
 
Address
  
being a member/members of the above-named Company hereby appoint the chairman of the meeting (see note 6) OR
Name
 
Address
 
as my/our proxy to attend, speak and vote in my/our name and on my/our behalf at the Annual General Meeting of the Company to be held on  
17 October 2013 at 9.30 am and at any adjournment thereof. 
 
Please tick this box if this proxy appointment is one of multiple appointments being made by the same member (see note 2).
 
The above proxy is appointed to exercise the rights attached to [all] OR 
Number shares
 
(see notes 1 and 2) of the ordinary shares 
held by me.
I/we direct my/our proxy to vote on the resolutions set out in the notice of Annual General Meeting as I/we have indicated by placing a mark in the 
appropriate box below (see notes 7 and 8).
Ordinary business FOR AGAINST VOTE WITHHELD
Resolution 1: To receive and consider the Annual Report and Accounts for the year ended 30 June 2013
Resolution 2: To declare a final dividend of 16 pence per ordinary share 
Resolution 3: To re-elect Christopher Macdonald as a director
Resolution 4: To re-elect Christopher Knight as a director
Resolution 5: To re-elect Colin Harris as a director
Resolution 6: To appoint PricewaterhouseCoopers LLP as the Company’s auditors and to authorise the directors  
to determine their remuneration
Special business FOR AGAINST VOTE WITHHELD
Resolution 7: Ordinary resolution to give the directors authority to allot shares
Resolution 8: Special resolution to give the directors power to disapply pre-emption rights in relation to the 
allotment of shares
Resolution 9: Special resolution to give the Company a general authority to purchase its own shares
Resolution 10: Ordinary resolution to approve the adoption of a Company Share Option Plan
Signature: 
 
Date: 
 / /2013
(To be valid, this proxy form must be signed) (see note 11)
Notes:
Your rights to appoint a proxy
1   As a member of the Company you are entitled to appoint a proxy to exercise all or any of your rights to attend and to speak and vote at a meeting of the Company. A proxy does not need to 
be a member of the Company. You may appoint more than one proxy in relation to a meeting provided that each proxy is appointed to exercise the rights attached to a different share or 
shares held by you.
2  You may appoint a proxy in respect of all or some only of the shares held by you. If you do not want to appoint a proxy in respect of all of the shares held by you, delete the word “all” in 
square brackets and insert the number of shares in respect of which you wish to appoint your proxy in the box provided. If you sign and return this proxy form with no number inserted, you 
will be deemed to have appointed your proxy in respect of all of the shares held by you.
3  If you require additional proxy forms in order to appoint more than one proxy, please contact the Company’s registrar, Capita Registrars Limited, or you may copy this form. Please indicate by 
ticking the box provided if the proxy appointment is one of multiple appointments being made. You must also indicate in the separate box the number of shares in relation to which the proxy 
holder is authorised to act as your proxy. All proxy forms must be signed and should, wherever possible, be returned together in one envelope.
4 If you appoint a proxy, this does not preclude you from attending the meeting and voting in person.
Procedure for appointing a proxy
5  Please insert your full name and address in block capitals in the box.
6  To appoint as your proxy a person other than the chairman of the meeting, delete the words in square brackets and insert the full name and address of your chosen proxy in block capitals in 
the box. If you sign and return this proxy form with no name inserted in the box, the chairman of the meeting will be deemed to be your proxy. Where you appoint as your proxy someone 
other than the chairman of the meeting, it is your responsibility to ensure that that person attends the meeting and is aware of your voting intentions. If you wish your proxy to make any 
comments on your behalf, you will need to appoint someone other than the chairman of the meeting and give that person your directions.
Directing your proxy how to vote
7   To direct your proxy how to vote on the resolutions mark the appropriate box with a “ ✔”or an “X”. If no voting direction is given, your proxy can vote or abstain from voting as he or she 
chooses. Your proxy has the right to vote (or abstain from voting) as he or she chooses in relation to any other business (including a resolution to adjourn the meeting or to amend a 
resolution) which may properly come before the meeting.
8  The “vote withheld” option is provided to enable you to abstain on any particular resolution. However, it should be noted that a “vote withheld” is not a vote in law and will not be counted 
in the calculation of the proportion of the votes “for” and “against” a resolution.
Other
9   To be valid, this proxy form must be received by post or (during normal business hours only) by hand at Capita Registrars Limited, PXS, 34 Beckenham Road, Kent BR3 4TU no later than 
9.30am on Tuesday 15 October 2013.
10  In the case of joint holders of any share, where more than one of the joint holders purports to appoint a proxy in respect of the same share, only the appointment submitted by the person 
whose name stands first in the register as one of the joint holders will be accepted.
11  This proxy form must be signed and dated by the member or his or her attorney duly authorised in writing. In the case of a member which is a company, this proxy form must be executed 
under its common seal or signed on its behalf by an officer of the company or an attorney for the company. Any power of attorney or other authority under which this proxy form is signed, or 
a copy of such power or authority, must be included with the proxy form.
12  In accordance with Regulation 41 of the Uncertificated Securities Regulations Act only those shareholders entered on the register of members at 6.00pm on Tuesday 15 October 2013 are 
entitled to attend and vote at the Annual General Meeting to be held at 9.30am on 17 October 2013.
FOLD
FOLD  Annual Report & Accounts 2013
73
Brooks Macdonald Group plc
Directors
C J Knight Chairman
C A J Macdonald Chief Executive
C R Harris Non-executive Director
N I Holmes 
S J Jackson Finance Director
D Seymour-Williams Non-executive Director
A W Shepherd 
R H Spencer 
S P Wombwell
  
Offices
110 and 111 Park Street  Mayfair  London  W1K 7JL 
The Long Barn  Dean Estate  Wickham Road  Fareham  Hampshire  PO17 5BN 
1 Marsden Street  Manchester  M2 1HW 
2 Mount Ephraim Road  Tunbridge Wells  Kent  TN1 1EE 
10 Melville Crescent  Edinburgh  EH3 7LU 
Richmond House  Heath Road  Hale  Cheshire  WA14 2XP 
Blackbrook Gate  Blackbrook Park Avenue  Taunton  Somerset  TA1 2PX 
Howard House  3 St Mary’s Court  Blossom Street  York  YO24 1AH 
Liberation House  Castle Street  St. Helier  Jersey  JE2 3AT 
Yorkshire House  Le Truchot  St. Peter Port  Guernsey  GY1 1WD 
36 Hamilton Terrace  Holly Walk  Leamington Spa  Warwickshire  CV32 4LY 
John Stow House  18 Bevis Marks  London  EC3A 7JB
Directors and advisers 
Company Secretary
S J Jackson
Registered Office
111 Park Street Mayfair London W1K 7JL
Company Registration Number
4402058
Independent Auditors
PricewaterhouseCoopers LLP 
7 More London Riverside London SE1 2RT
Solicitors
Macfarlanes LLP  
20 Cursitor Street London EC4A 1LT
Public Relations
MHP Communications Limited
60 Great Portland Street London W1W 7RT
Principal Bankers
The Royal Bank of Scotland plc  
40 Islington High Street London N1 8JX 
Registrars
Capita Registrars Limited 
The Registry 34 Beckenham Road Kent BR3 4TU
Nominated Adviser and Broker
Canaccord Genuity Limited  
9th Floor 88 Wood Street London EC2V 7QR www.brooksmacdonald.com