b'Mercia Asset Management PLC73Annual Report and Accounts 2021Independent auditors report to the membersof Mercia Asset Management PLCOpinion on the financial statementsIn our opinion:the financial statements give a true and fair view of the state of the Groups and of the Parent Companys affairs as at 31 March 2021 and of the Groups profit for the year then ended;the Group financial statements have been properly prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006;the Parent Company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; andthe financial statements have been prepared in accordance with the requirements of the Companies Act 2006.We have audited the financial statements of Mercia Asset Management PLC (the Parent Company) and its subsidiaries (the Group) for the year ended 31 March 2021 which comprise:the Consolidated Statement of Comprehensive Income; the Consolidated and Companys Balance Sheets; the Consolidated and Companys Statements of Changes in Equity; the Consolidated Cash Flow Statement; and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law Governance Strategic reportand international accounting standards in conformity with the requirements of the Companies Act 2006. The financial reporting framework that has been applied in the preparation of the Parent Company financial statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors responsibilities for the audit of the financial statementsFinancial statementssection of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour opinion.IndependenceWe remain independent of the Group and Parent Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRCs Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. Conclusions relating to going concernIn auditing the financial statements, we have concluded that the Directors use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors assessment of the Groups and Parent Companys ability to continue to adopt the going concern basis of accounting included:Reviewing the forecasted cash flows that support the Directors assessment of going concern to check that they are in line with our expectations based on our understanding of the Group. Key assumptions include forecast direct investment, forecast revenues and investment realisations. These have been reviewed against current performance, availability of cash resources and the other stress tested scenarios;Evaluating managements method of assessing going concern in light of market volatility;Calculating financial ratios to consider the financial health of the Group and Parent Company.Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group and Parent Companys ability to continue as a going concern fora period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.'