b'40 Mercia Asset Management PLC Annual Report & Accounts 2022Chief Financial Officers review continuedSummarised statement of financial position and cash flowsAs at As at31 March 31 March2022 2021000 000Goodwill and intangible assets 32,355 34,388Direct investment portfolio 119,558 96,220Other non-current assets, trade and other receivables 1,604 4,623Cash and short-term liquidity investments 61,284 57,209Total assets 214,801 192,440Trade and other payables (7,415) (8,600)Deferred consideration (2,869) (4,447)Deferred taxation (3,928) (3,372)Total liabilities (14,212) (16,419)Net assets 200,589 176,021Net assets per share (pence)* 45.6p 40.0p*440,109,707 Ordinary shares were in issue during the years ended 31 March 2022 and 31 March 2021Net assets per share increased byCash and short-term liquidity investmentsc.14% during the year, notwithstandingAt the year end, Mercia had cash and short-term liquidity investments (which is the payment of dividends totallingcash on deposit with maturities of between 32 days and three months) totalling 2,641,000 (2021: c.24% growth after61,284,000 (2021: 54,725,000), comprising cash of 56,049,000 (2021: 54,491,000) dividends paid of 440,000). and short-term liquidity investments of 5,235,000 (2021: 234,000). The Group held Intangible assets no cash on behalf of third-party EIS investors as at 31 March 2022 (2021: 2,484,000), following the appointment of an external custodian during the year.Details of the Groups intangible assets are given in notes 13 and 14 to theThe Group continues to have limited working capital needs due to the nature of its consolidated financial statements, andbusiness and generated net operating cash inflow of 9.2million (2021: 5.6million consist of goodwill and the intangiblenet inflow).asset recognised on the acquisition of the VCT fund management business. The overriding emphasis of the Groups treasury policy remains the preservation of its shareholders cash for investment, corporate and working capital purposes, not Direct investment portfolio yield. As at 31 March 2022, the Groups cash and short-term liquidity investments During the year under review, Merciaswere spread across four leading United Kingdom banks.direct investment portfolio grew from 96,220,000 as at 1 April 2021 (2021:The summarised movements in the Groups cash and short-term liquidity 87,471,000 as at 1 April 2020) toinvestments position during the year is shown below.119,558,000 as at 31 March 2022 (2021: 96,220,000), a c.24% increaseYear ended Year ended31 March 31 Marchnotwithstanding the sale of Faradion2022 2021during the year (2021: c.10% increase). 000 000The Group invested 18,384,000 netOpening cash and short-term liquidity investments 54,725 30,186(2021: 15,397,000) into 14 existing andNet cash generated from operating activities 9,150 5,611two new direct investments (2021: 17Net cash generated from direct investment activities 2,363 21,640and two respectively), with the top 20Purchase of VCT fund management contracts (2,100) (2,100)direct investments representing 98.6%Cash outflow from other investing activities (62) (34)of the total direct investment portfolioNet cash used in financing activities (2,792) (578)value (2021: 98.5%). Closing cash and short-term liquidity investments 61,284 54,725Further detail on the fair value movements of individual direct portfolio companies can be seen in Julian Viggars CIO review on page 15.'