New Star Investment Trust : 06/20 annual report

N E W S TA R I N V E S T M E N T T R U S T P L C

REPORT AND ACCOUNTS

for the year ended 30th June 2020

NEW STAR INVESTMENT TRUST PLC

CONTENTS

	Page
INVESTMENT OBJECTIVE	2
COMPANY INFORMATION	3
BOARD OF DIRECTORS	4
STRATEGIC REPORT:
-  FINANCIAL HIGHLIGHTS	5
-  CHAIRMAN'S STATEMENT	6
-  INVESTMENT MANAGER'S REPORT	7
-  SCHEDULE OF LARGEST INVESTMENTS	10
-  STRATEGIC REVIEW	11
DIRECTORS' REPORT	18
CORPORATE GOVERNANCE STATEMENT	26
REPORT OF THE AUDIT COMMITTEE	30
DIRECTORS' REMUNERATION REPORT	33
STATEMENT OF DIRECTORS' RESPONSIBILITIES	36
INDEPENDENT AUDITOR'S REPORT	37
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME	50
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY	51
COMPANY STATEMENT OF CHANGES IN EQUITY	52
CONSOLIDATED BALANCE SHEET	53
COMPANY BALANCE SHEET	54
CASH FLOW STATEMENTS	55
NOTES TO THE ACCOUNTS	56
NOTICE OF ANNUAL GENERAL MEETING	77

1

NEW STAR INVESTMENT TRUST PLC

INVESTMENT OBJECTIVE

The Company's objective is to achieve long-term capital growth.

THIS DOCUMENT IS IMPORTANT and, if you are a holder of Ordinary shares requires your attention. If you are in doubt as to what action to take you should seek advice from your own independent personal financial advisor. If you have sold or otherwise transferred all of your Ordinary shares in the capital of the Company you should send this document and the accompanying Form of Proxy immediately to the purchaser or transferee; or to the stockbroker, bank or other agent through whom the sale or transfer was effected.

The Company's shares are traded on the London Stock Exchange and are not subject to restriction under the Financial Conduct Authority's non-mainstream investment products regime.

REGISTERED OFFICE

1 Knightsbridge Green, London, SW1X 7QA

Company Number: 03969011

2

NEW STAR INVESTMENT TRUST PLC

COMPANY INFORMATION

DIRECTORS

G Howard-Spink (Chairman)

J L Duffield (Deputy Chairman)

D J Gamble

INVESTMENT MANAGER

Brompton Asset Management LLP

1 Knightsbridge Green, London SW1X 7QA

(Authorised and regulated by the Financial Conduct Authority)

SECRETARY AND ADMINISTRATOR

Maitland Administration Services Limited

Hamilton Centre, Rodney Way, Chelmsford, Essex CM1 3BY

Telephone: [phone]

SOLICITORS

CMS Cameron McKenna Nabarro Olswang LLP

Cannon Place, 78 Cannon Street

London EC4N 6AF

AUDITORS

Ernst & Young LLP

Atria One, 144 Morrison Street, Edinburgh EH3 8EX

CUSTODIAN

Brown Brothers Harriman & Co

Park House, 16 - 18 Finsbury Circus, London EC2M 7EB

REGISTRARS

Equiniti Limited

Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA

Telephone: [phone]

Website: shareview.co.uk

WEBSITE

www.nsitplc.com

The Company's shares are traded on the London Stock Exchange and their prices are shown in

the Financial Times under "Investment Companies".

3

NEW STAR INVESTMENT TRUST PLC

BOARD OF DIRECTORS

Geoffrey Howard-Spink(Chairman)* was one of the founders in 1981 of Lowe Group Limited, one of the UK's biggest advertising groups. He was Chairman of Immedia Group PLC and a director of Chrysalis. Mr Howard-Spink was appointed Chairman of the Company with effect from 13th May 2009.

John L Duffield (Deputy Chairman) is the Senior Partner of Brompton Asset Management Group LLP. Mr Duffield was Chairman of New Star Asset Management Group PLC between 2000 and April 2009. Prior to founding New Star, Mr Duffield was the founder and chief executive of Jupiter International Group from 1985 to 2000.

David Gamble* was chief executive of British Airways Pension Investment Management from 1993 to 2004. He has also served as a director of numerous financial services companies including a number of investment companies. Mr Gamble was appointed a Director on 16 November 2017 and is the chairman of the Audit Committee.

* Members of the Audit Committee and Independent Directors

4

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

FINANCIAL HIGHLIGHTS

	30th June	30th June	%
	2020	2019	Change
PERFORMANCE
Net assets (£ '000)	113,885	113,971	(0.1)
Net asset value per Ordinary share	160.35p	160.47p	(0.1)
Mid-market price per Ordinary share	106.00p	111.00p	(4.5)
Discount of price to net asset value	33.9%	30.83%	n/a
Total Return*	0.80%	2.98%	n/a
IA Mixed Investment 40% - 85% Shares (total return)	(0.15)%	3.66%	n/a
MSCI AC World Index (total return, sterling adjusted)	5.72%	10.30%	n/a
MSCI UK Index (total return)	(15.21)%	1.68%	n/a

	1st July 2019 to	1st July 2018 to
	30th June 2020	30th June 2019
Revenue return per Ordinary share		1.87p		1.81p
Capital return per share		(0.59)p		2.86p
Return per Ordinary share		1.28p		4.67p
TOTAL RETURN*	0.80%		2.98%
PROPOSED DIVIDEND PER ORDINARY SHARE		1.40p		1.40p

• The total return figure for the Group represents the revenue and capital return shown in the Consolidated Statement of Comprehensive Income divided by the net asset value at the beginning of the period.

5

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

CHAIRMAN'S STATEMENT

PERFORMANCE

Your Company generated a positive total return of 0.80% over the year to 30th June 2020, taking the net asset value (NAV) per ordinary share to 160.35p. By comparison, the Investment Association's Mixed Investment 40-85% Shares Index fell 0.15%. The MSCI AC World Total Return Index rose 5.72% while the MSCI UK Total Return Index fell 15.21%. Over the year, UK government bonds returned 11.98%. Further information is provided in the investment manager's report.

Your Company made a revenue profit for the year of £1.32 million (2019: £1.28 million).

GEARINGS AND DIVIDEND

Your Company has no borrowings. It ended the year under review with cash representing 9.63% of its NAV and is likely to maintain a significant cash position. In respect of the financial year to 30th June 2020, your Directors recommend the payment of a dividend of 1.4p per share (2019: 1.4p). The level of future dividends may, in the short term, be adversely affected by Covid-19- related dividend cuts.

DISCOUNT

During the year under review, your Company's shares continued to trade at a significant discount to their NAV. The Board keeps this issue under review.

PERFORMANCE FEE

In November 2019, your Company announced that the arrangement for performance fees was not appropriate in a low interest rate environment, with the result that the existing performance fee arrangement ceased from 1st January 2020. A performance fee of £623,000 (2019: £410,000) was payable in respect of the year to 30th June 2020.

OUTLOOK

Over the late summer of 2020, equities appeared attractive for long-term investors, supported by large-scale monetary and fiscal stimulus measures. By July, leading indicators for some of the world's major economies had risen significantly from their lows, implying that a global economic recovery was on the horizon, and there was some positive news on vaccines and treatments for Covid-19. Corporate bonds may also perform well as yield spreads over sovereign bonds narrow. Resurgent Covid-19 infection rates in some countries, tense Sino-US relations and the approaching US election may, however, lead to renewed short-term weakness. Shortly after the year end, your Company took some profits from investments in equity funds because of uncertainty regarding the spread of Covid-19.

ANNUAL GENERAL MEETING

The annual general meeting will be held on 12th November 2020. Further details are provided on page 23 of the Directors' Report.

NET ASSET VALUE

Your Company's unaudited net asset value per share at 31st August 2020 was 162.94p.

Geoffrey Howard-Spink

Chairman

23rd September 2020

6

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

INVESTMENT MANAGER'S REPORT

MARKET REVIEW

The Covid-19 pandemic and the impact of lockdowns to contain the spread of the virus dominated financial markets during the second half of your Company's financial year. Global equities fell 25.33% in sterling from their high on 20th February 2020 to their 16th March low. Global equities recovered, however, during the final quarter, extending the 4.89% gain in sterling at the interim stage to close the year up 5.72%. The announcements by central banks and governments of large- scale monetary and fiscal stimulus measures softened the impact of the lockdowns on businesses and households and reassured investors.

Global bonds outperformed equities over the year, rising 7.35% in sterling as leading central banks cut interest rates to near-zero and increased quantitative easing. UK government bonds were particularly strong, returning 11.98%. Interest rates are likely to remain low for some time. In March, the yield spreads of corporate and high-yield bonds widened over sovereign bond yields as investors anticipated more businesses would default, particularly in the hard-pressed energy, retail and travel and leisure sectors. The Fed expanded its asset purchase programme to include corporate bonds, leading to improved liquidity and lower yields overall. Sterling corporate and high-yield bonds returned 6.52% and 0.62% respectively over the year.

US equities outperformed, returning 10.73% in sterling, buoyed by the 41.67% rise by US technology stocks. Technology companies benefited from their strong balance sheets and an acceleration in the established trends towards home working and online shopping and entertainment.

UK equities lagged, falling 15.21% as the London market's heavy weighting in cyclical sectors such as energy, financials and industrials proved a headwind. Uncertainty regarding European Union-UK trade negotiations also weighed on stocks as the government allowed the 30th June deadline for a request to extend the Brexit transition period to lapse. Sterling lost 2.92%, 2.78% and 1.57% respectively against the dollar, yen and euro.

Equities in Europe excluding the UK underperformed, falling 3.50% in sterling on fears that fiscally-prudent northern countries might oppose an EU rescue package that included grants rather than loans to heavily-indebted southern countries. Such a deal was, however, agreed shortly after your Company's year-end. Equities in Asia excluding Japan and emerging markets also lagged, rising 5.03% and falling 0.14% respectively in sterling despite a leading indicator suggesting China would emerge strongly from the crisis. Sino-US relations deteriorated as Beijing passed a new security law governing Hong Kong and the US retaliated by revoking Hong Kong's special status under US law.

Oil prices fell 63.66% in sterling as lower demand during the lockdowns compounded the impact of the Russo-Saudi oil price war. By contrast, gold rose 29.44% in sterling, benefitting from safe- haven buying and the lower opportunity cost of holding this nil-yielding asset in an environment of near-zero interest rates.

7

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

INVESTMENT MANAGER'S REPORT continued

PORTFOLIO REVIEW

Your Company's total return over the year under review was 1.34% before performance fees and 0.80% after performance fees. By comparison, the Investment Association's Mixed Investment 40-85% Shares sector, comprising a peer group of multi-asset funds that typically invest 40-85% of their assets in global equities, fell 0.15%. The MSCI AC World Total Return Index rose 5.72% in sterling while the MSCI UK Total Return Index fell 15.21%. Your Company benefited from strong performance by investments in technology and gold mining.

Performance was, however, held back by poor performance by UK equities and a relatively low investment in global bonds.

Polar Capital Global Technology made the biggest positive contribution to your Company's performance, rising 39.78% over the year. The fund increased in size from $3.4 billion to $5.8 billion, with inflows totalling $1.1 billion. In response, Polar Capital soft-closed the fund in July, with the result that only existing investors such as your Company may add to their holdings. Fundsmith Equity, your Company's largest investment, also benefited from the strong performance of technology stocks, which account for a significant proportion of its portfolio, with Facebook and Microsoft among its 10 largest holdings. At the year end, prospects for technology companies remained bright although increasing regulatory pressures were a potential headwind. In June, the European Commission opened two anti-trust investigations into Apple; in July, the chief executives of Amazon, Apple, Facebook and Google were invited to testify before Congress as part of an anti-trust investigation.

Underperformance by UK equities detracted from performance. Investments in UK equity income funds have contributed significantly to your Company's income and capacity to pay dividends. The UK equity income allocation increased in November 2019 through an additional purchase of Chelverton UK Equity Income. In March, following market falls, the UK equity allocation increased further through the purchase of the SPDR UK FTSE All-Shareexchange-traded fund. In May, following a partial recovery by UK stocks from their March through, Schroder Income, which invests in UK equities, was sold in favour of Baillie Gifford Global Income Growth.

Higher-yielding UK stocks fell as dividends were cancelled, cut or deferred. Dividends from UK stocks are expected to fall more than in the US and mainland Europe because of the London market's relatively high weighting in cyclical sectors such as financials and energy. In March, the Prudential Regulation Authority, the banking regulator, said the seven largest UK banks would suspend dividends and buybacks until the end of 2020. BP and Royal Dutch Shell, which accounted for a significant proportion of all dividends paid by UK companies, cut their dividends. In the case of Royal Dutch Shell, this was for the first time since the Second World War. Aberforth Split Level Income was the portfolio's worst performer, falling 35.14% as declines by UK stocks were compounded by the manager's out-of-favour value style of investing and gearing resulting from its zero dividend preference shares. Man GLG UK Income fell 15.61% but Trojan Income, down only 5.58%, proved more resilient as a result of its holdings in defensive consumer stocks such as Reckitt Benckiser and Unilever.

8

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

INVESTMENT MANAGER'S REPORT continued

BlackRock Gold & General, up 43.95%, was the second largest positive contributor to your Company's returns. Gold mining profits are highly sensitive to gold price movements and bullion benefitted over the year from safe-haven buying and fears that large-scale monetary easing might result in the debasement of fiat currencies.

Amongst your Company's lower-risk investments, Aquilus Inflection, a euro-hedged long/short equity fund, rose 10.21% while Trojan, a multi-asset fund with investments in defensive equities, inflation-linked bonds, gold and cash, rose 7.52%. An investment in Chelsea Managed Monthly Income, which has a multi-asset portfolio, was purchased to provide further diversification and an income.

Your Company has a significant allocation to cash, held primarily in dollars. It benefitted, therefore, from the dollar's 3.0% rise against sterling over the year.

At the year end, your Company's private equity holdings represented approaching 7.5% of its portfolio. Its investment in the Embark financial services group represented more than 80% of the value of the unquoted holdings. Following the completion of two successful equity issues to finance two acquisitions, the Embark holding was written up by 17.5% to reflect the latest external fundraising.

OUTLOOK

Over the late summer of 2020, the outlook for equities remained positive given the monetary and fiscal support in place and the possibility that further stimulus measures might be forthcoming, particularly in the US. By July, leading indicators for some of the world's major economies had risen significantly, implying that a global economic recovery was on the horizon. Your Company did, however take some profits from investments in equity funds shortly after the year end because of uncertainty regarding the spread of Covid-19. In June, the World Health Organisation warned the worst could be to come.

Brompton Asset Management LLP Investment manager

30th September 2020

9

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

SCHEDULE OF LARGEST HOLDINGS AT 30th JUNE 2020

	Market		Purchases/		Market		Market	% of net
	value		Sales		movement		value		assets
	30 June						30 June
	2019					2020
	£'000		£'000		£'000		£'000
Fundsmith Equity Fund	7,839		-	722	8,561	7.52
Polar Capital Global Technology	5,280		-	2,101	7,381	6.48
Embark Group	5,942		-	1,048	6,990	6.14
SPDR FTSE UK All Share	-	5,008	536	5,544	4.87
BlackRock Gold & General	3,470		-	1,515	4,985	4.38
TM Crux European Special Situations Fund	5,098		-	(177)	4,921	4.32
EF Brompton Global Consecutive Fund	4,222		-	136	4,358	3.83
Aquilus Infection Fund	3,698		-	378	4,076	3.58
BlackRock Continental European Income	3,794	-	137	3,931	3.45
Fund
Lindsell Train Japanese Equity Fund	3,144		-	387	3,531	3.10
Artemis Global Income Fund	3,856		-	(495)	3,361	2.95
Baillie Gifford Global Income Growth	-	3,200	154	3,354	2.95
MI Chelverton UK Equity Income Fund	1,487	2,500	(974)	3,013	2.65
EF Brompton Global Equity Fund	2,846		-	126	2,972	2.61
EF Brompton Global Opportunities Fund	2,840		-	83	2,923	2.57
EF Brompton Global Growth Fund	2,694		-	64	2,758	2.42
Liontrust Asia Income Fund	2,763		-	(141)	2,622	2.30
First State Indian Subcontinent Fund	2,750		-	(304)	2,446	2.15
MI Brompton UK Recovery Unit Trust	2,669		-	(352)	2,317	2.03
EF Brompton Global Balanced Fund	2,246		-	68	2,314	2.03
Aberforth Split Level Income Trust	3,747		-	(1,494)	2,253	1.98
Man GLG UK Income Fund	2,767		-	(561)	2,206	1.94
Trojan Income Fund	2,379		-	(215)	2,164	1.90
Schroder Income Fund	4,795	(3,272)	(1,523)		-		-
	80,326	7,436	1,219	88,981	78.15
Balance not held in investments above	13,456	2,009	(1,431)	14,034	12.32
Total investments (excluding cash)	93,782	9,445	(212)	103,015	90.47
Cash	20,605	(9,769)	126	10,962	9.63
Other net current assets	(416)	324		-	(92)	(0.08)
	113,971		-	(86)	113,885	100.00

The investment portfolio, excluding cash, can be further analysed as follows:

	£ '000
Investment funds	83,363
Investment companies and exchange traded funds	10,642
Unquoted investments	8,468
Other quoted investments	542
	103,015

10

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW

The Strategic Review is designed to provide information primarily about the Company's business and results for the year ended 30th June 2020. The Strategic Review should be read in conjunction with the Chairman's Statement on page 6 and the Investment Manager's Report on pages 7 to 9, which provide a review of the year's investment activities of the Company and the outlook for the future.

STATUS

The Company is an investment company under section 833 of the Companies Act 2006. It is an Approved Company under the Investment Trust (Approved Company) (Tax) Regulations 2011 (the 'Regulations') and conducts its affairs in accordance with those Regulations so as to retain its status as an investment trust and maintain exemption from liability to United Kingdom capital gains tax.

The Company is a small registered Alternative Investment Fund Manager under the European Union Markets in Financial Instruments Directive.

PURPOSE CULTURE AND VALUES

The Directors acknowledge the expectation under the Code that they formally define a purpose for the Company. The Directors have reviewed this requirement and consider that the Company's purpose is to deliver the Company's stated investment objective to achieve long-term capital growth for the benefit of its investors.

Similarly, the Directors have also considered the Company's culture and values in line with Code requirements. The Board has formed the view that as the Company has no direct employees, and with operational management outsourced to the Investment Manager, the Administrator and the Company Secretary, the Company's culture and values have to be those of the Board. Having a stable composition and established working practices, the Board is defined by experienced membership, trust and robust investment challenge. These are therefore the key characteristics of the Company's culture and values.

STAKEHOLDER RESPONSIBILITIES (S.172 STATEMENT UNDER COMPANIES ACT 2006)

The Directors are aware of their responsibilities to stakeholders under both the UK Corporate Governance Code issued by the Financial Reporting Council in July 2018 ('the code') and legislation through regular governance updates from the Company Secretary. As a UK listed investment trust, the Directors outsource operational management of the Company, including day to day management of the investment portfolio, to third parties. As a consequence, the Directors consider their key stakeholder groups to be limited to the Company's shareholders, its third party advisers and service providers, and individual board members.

11

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

The Company's Articles of Association, the Board's commitment to follow the principles of the Code and the involvement of the independent Company Secretary in board matters enable the Directors to meet their responsibilities towards individual shareholder groups and board members. Governance procedures are in place which allow both investors and directors to ask questions or raise concerns appropriately. The Board is satisfied that those governance procedures mean the Company can act fairly between individual shareholders and takes account of Mr Duffield's significant shareholding. In considering the payment of the minimum dividend required to maintain investment trust tax status, the recommendations to vote in favour of the resolutions at the AGM, the change to the performance fee arrangements and the provision of temporary liquidity facilities, the Board assessed the potential benefits to shareholders and the manager of the investment portfolio.

The Board also regularly considers the performance of its independent third party service providers. Those third party service providers in turn have regular opportunities to report on matters meriting the attention of the Board, including in relation to their own performance. The Board is therefore confident that its responsibilities to each of its key stakeholder groups are being discharged effectively.

As the Company does not have any employees, the Board does not consider it necessary to establish means for employee engagement with the Board as required by the latest version of the Code.

INVESTMENT OBJECTIVE AND POLICY

Investment Objective

The Company's investment objective is to achieve long-term capital growth.

Investment Policy

The Company's investment policy is to allocate assets to global investment opportunities through investment in equity, bond, commodity, real estate, currency and other markets. The Company's assets may have significant weightings to any one asset class or market, including cash.

The Company will invest in pooled investment vehicles, exchange traded funds, futures, options, limited partnerships and direct investments in relevant markets. The Company may invest up to 15% of its net assets in direct investments in relevant markets.

The Company will not follow any index with reference to asset classes, countries, sectors or stocks. Aggregate asset class exposure to any one of the United States, the United Kingdom, Europe ex UK, Asia ex Japan, Japan or Emerging Markets and to any individual industry sector will be limited to 50% of the Company's net assets, such values being assessed at the time of investment and for funds by reference to their published investment policy or, where appropriate, the underlying investment exposure.

The Company may invest up to 20% of its net assets in unlisted securities (excluding unquoted pooled investment vehicles) such values being assessed at the time of investment.

12

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

The Company will not invest more than 15% of its net assets in any single investment, such values being assessed at the time of investment.

Derivative instruments and forward foreign exchange contracts may be used for the purposes of efficient portfolio management and currency hedging. Derivatives may also be used outside of efficient portfolio management to meet the Company's investment objective. The Company may take outright short positions in relation to up to 30% of its net assets, with a limit on short sales of individual stocks of up to 5% of its net assets, such values being assessed at the time of investment.

The Company may borrow up to 30% of net assets for short-term funding or long-term investment purposes.

No more than 10%, in aggregate, of the value of the Company's total assets may be invested in other closed-ended investment funds except where such funds have themselves published investment policies to invest no more than 15% of their total assets in other listed closed-ended investment funds.

Information on the Company's portfolio of assets with a view to spreading investment risk in accordance with its investment policy is set out on page 12.

FINANCIAL REVIEW

Net assets at 30th June 2020 amounted to £113,885,000 compared with £113,971,000 at 30th June 2019. In the year under review, the NAV per Ordinary share decreased by 0.1% from 160.47p to 160.35p, after paying a dividend of 1.4p per share.

The Group's gross revenue increased to £2,419,000 (2019: £2,239,000). In 2019 and 2020 the Company increased its investment in income focused funds resulting in an increase in gross income in both years. The year under review was not impacted significantly by the Covid-19 pandemic. After deducting expenses and taxation, the revenue profit for the year was £1,325,000 (2019: £1,285,000).

Total expenses for the year amounted to £1,717,000 (2019: £1,364,000), mainly as a result of an increased performance fee becoming payable. In the year under review the investment management fee amounted to £697,000 (2019: £688,000). A performance fee of £623,000 (2019; £410,000) was payable in respect of the year under review. The performance fee has been allocated to the Capital account in accordance with the Company's accounting policy. Further details on the Company's expenses may be found in notes 3 and 4 on page 60.

Dividends have not formed a central part of the Company's investment objective. The increased investment in income focused funds has enabled the Directors to declare an increased dividend in recent years. The Directors propose a final dividend of 1.40p per Ordinary share in respect of the year ended 30th June 2020 (2019: 1.40p). If approved at the Annual General Meeting, the dividend will be paid on 30th November 2020 to shareholders on the register at the close of business on 6th November 2020 (ex-dividend 5th November 2020).

13

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

The primary source of the Company's funding is shareholder funds.

While the future performance of the Company is dependent, to a large degree, on the performance of international financial markets, which in turn are subject to many external factors, the Board's intention is that the Company will continue to pursue its stated investment objective in accordance with the strategy outlined above. Further comments on the short-term outlook for the Company are set out in the Chairman's Statement on page 6 and the Investment Manager's report on pages 7 to 9.

Throughout the year the Group's investments included seven funds managed by the Investment Manager (2019: seven). No investment management fees were payable directly by the Company in respect of these investments.

PERFORMANCE MEASUREMENT AND KEY PERFORMANCE INDICATORS

In order to measure the success of the Company in meeting its objectives, and to evaluate the performance of the Investment Manager, the Directors review at each meeting: net asset value, income and expenditure, asset allocation and attribution, share price of the Company and the discount. The Directors take into account a number of different indicators as the Company does not have a formal benchmark, and performance against these is shown in the Financial Highlights on page 5.

Performance is discussed in the Chairman's Statement and Investment Manager's Report on pages 6 to 9.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks identified by the Board, and the steps the Board takes to mitigate them, are discussed below. The audit committee reviews existing and emerging risks on a six monthly basis. The Board has closely monitored the societal, economic and market focused implications of the events in 2020 to date, and have accordingly added a new macro-economic event risk to reflect these considerations:

Investment strategy

Inappropriate long-term strategy, asset allocation and fund selection could lead to underperformance. The Board discusses investment performance at each of its meetings and the Directors receive reports detailing asset allocation, investment selection and performance.

Business conditions and general economy

The Company's future performance is heavily dependent on the performance of different equity and currency markets. The Board cannot mitigate the risks arising from adverse market movements. However, diversification within the portfolio will reduce the impact. Further information is given in portfolio risks below.

14

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

Macro-economic event risk

The Covid pandemic has been felt globally in 2020. The scale and potential adverse impact of a macro-economic event, such as the Covid pandemic, has highlighted the possibility of a number of identified risks such as market risk, currency risk, investment liquidity risk and operational risk having an adverse impact at the same time. The risk may impact on: the value of the Company's investment portfolio, its liquidity, meaning investments cannot be realised quickly, or the Company's ability to operate if the Company's suppliers face financial or operational difficulties. The Directors closely monitor these areas and currently maintain a significant cash balance.

Portfolio risks - market price, foreign currency and interest rate risks

The largest investments are listed on page 10. Investment returns will be influenced by interest rates, inflation, investor sentiment, availability/cost of credit and general economic and market conditions in the UK and globally. A significant proportion of the portfolio is in investments denominated in foreign currencies and movements in exchange rates could significantly affect their sterling value. The Investment Manager takes all these factors into account when making investment decisions but the Company does not normally hedge against foreign currency movements. The Board's policy is to hold a spread of investments in order to reduce the impact of the risks arising from the above factors by investing in a spread of asset classes and geographic regions.

Net asset value discount

The discount in the price at which the Company's shares trade to net asset value means that shareholders cannot realise the real underlying value of their investment. Over the last few years the Company's share price has been at a significant discount to the Company's net asset value. The Directors review regularly the level of discount, however given the investor base of the Company, the Board is very restricted in its ability to influence the discount to net asset value.

Investment Manager

The quality of the team employed by the Investment Manager is an important factor in delivering good performance and the loss of key staff could adversely affect returns. A representative of the Investment Manager attends each Board meeting and the Board is informed if any major changes to the investment team employed by the Investment Manager are proposed. The Investment Manager regularly informs the Board of developments and any key implications for either the Investment Strategy or the investment portfolio.

Tax and regulatory risks

A breach of The Investment Trust (Approved Company) (Tax) Regulations 2011 (the 'Regulations') could lead to capital gains realised within the portfolio becoming subject to UK capital gains tax. A breach of the FCA Listing Rules could result in suspension of the Company's shares, while a breach of company law could lead to criminal proceedings, financial and/or reputational damage. The Board employs Brompton Asset Management LLP as Investment Manager, and Maitland Administration Services Limited as Secretary and Administrator, to help manage the Company's legal and regulatory obligations.

15

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

Operational

Disruption to, or failure of, the Investment Manager's or Administrator's accounting, dealing or payment systems, or the Custodian's records, could prevent the accurate reporting and monitoring of the Company's financial position. The Company is also exposed to the operational risk that one or more of its suppliers may not provide the required level of service. How the Board monitors its service providers, with an emphasis on their business interruption procedures, is set out in the Corporate Governance Statement on pages 26 to 29.

The Directors confirm that they have carried out an assessment of the risks facing the Company, including those that would threaten its business model, future performance, solvency and liquidity.

VIABILITY STATEMENT

The assets of the Company consist mainly of securities that are readily realisable or cash and it has no significant liabilities and no financial commitments. In the last few years investment income has exceeded annual expenditure and current liquid net assets cover current annual expenses for many years. Accordingly, the Company is of the opinion that it has adequate financial resources to continue in operational existence for the long term which is considered to be in excess of five years. Five years is considered a reasonable period for investors when making their investment decisions. In reaching this view the Directors reviewed the anticipated level of annual expenditure against the cash and liquid assets within the portfolio. The Directors have also considered the risks the Company faces, and have considered the economic and operational implications of third party suppliers arising from the Covid-19 pandemic in finalising this viability statement.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE ISSUES

The Company has no employees, with day-to-day operational and administration of the Company being delegated by the Board to the Independent Investment Manager and the Administrator. The Company's portfolio is managed in accordance with the investment objective and policy approved by shareholders. The Company is primarily invested in investment funds and exchange traded funds, where it has no direct dialogue with underlying investments. Environmental, social and governance considerations of underlying investee companies are not a key driver when evaluating existing and potential investments.

GREENHOUSE GAS EMISSIONS

As the Company has no premises, properties or equipment of its own, the Directors deem the Company to be exempt from making any disclosures under the Companies Act 2006 (Strategic Reports and Directors' Reports) Regulations 2013.

STREAMLINED ENERGY AND CARBON REPORTING

The Company is categorised as a lower energy user under the HMRC Environmental Reporting Guidelines March 2019 and is therefore not required to make the detailed disclosures of energy and carbon information set out within the guidelines. The Company's energy and carbon information is not therefore disclosed in this report.

16

NEW STAR INVESTMENT TRUST PLC

STRATEGIC REPORT

for the year ended 30th June 2020

STRATEGIC REVIEW continued

MODERN SLAVERY ACT

The Directors rely on undertakings given by its independent third party advisers that those companies continue to have no instances of modern slavery either within their businesses or supply chains. Given the financial services focus and geographical location of all third-party suppliers to the Company, the Directors perceive the risks of a contravention of the legislation to be very low.

GENDER DIVERSITY

The Board of Directors comprises three male directors, and currently no female board members. Composition of the Board has not changed since 2017, and the Board has benefitted from stable membership and strong working relationships between individual directors in that time. For this reason, the Board does not currently anticipate making future changes.

The Board is committed to the benefits of diversity, including gender, ethnicity and background when considering new appointments to the Board, whilst always seeking to base any decision on merit, measured by knowledge, experience and ability to make a positive contribution to the Board's decision making.

LISTING RULE 9.8.4

Listing rule 9.8.4 required the Company to include certain information in a single identifiable section of the Annual Report or a cross-reference table indicating where the information is set out. The Directors confirm that there were no disclosures to be made in this regard.

APPROVAL STATEMENT

The Strategic Report of the Company, comprising the information contained on pages 5 to 17 of this Report and Accounts was approved by the Board and signed on its behalf by:

Geoffrey Howard-Spink

Chairman

30th September 2020

17

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT

The Directors present the audited accounts of the Company and their report for the year ended 30th June 2020.

STATUS

The Company is a public limited company incorporated and registered in England and Wales and is domiciled in the United Kingdom. The Company number is 03969011.

The Company is an investment company under section 833 of the Companies Act 2006. It is an Approved Company under the Investment Trust (Approved Company) (Tax) Regulations 2011 (the 'Regulations') and conducts its affairs in accordance with those Regulations so as to continue to gain exemption from liability to United Kingdom capital gains tax.

The Company is listed on the London Stock Exchange, with ISIN GB0002631041 and SEDOL 0263104 and accordingly is subject to the Listing Rules issued by the FCA, the Disclosure Guidance and Transparency Rules issued by the Financial Conduct Authority and the UK Corporate Governance Code 2018 issued by the Financial Reporting Council.

The Company has been approved by the Financial Conduct Authority to be a small registered Alternative Investment Fund Manager under the European Union Directive.

DIRECTORS

Board composition

The names and biographies of the Directors are given on page 4. The Articles of Association provide that the total number of Directors shall be not less than two nor more than ten.

No Director has a contract of employment with the Company. Directors' terms of appointment are set out in letters of appointment which are available for inspection at the registered office of the Company and will be available at the Annual General Meeting ('AGM').

The following Directors, all of whom are non-executive, served during the year:

	Date of appointment
	as a Director
G Howard-Spink (Chairman)	13th April 2000
J L Duffield	5th April 2000
D J Gamble	16th November 2017

During the year under review the Company did not arrange insurance cover in respect of legal action against the Directors, as it was considered that the premium would not constitute good value to shareholders. The Directors are indemnified by the Company against all liabilities, except where prohibited by law.

18

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

Board independence

The Board considers a range of factors in determining the independence of the individual directors including their character and judgment, whether they have any material business relationships with the Company or its advisers, whether they have any close family ties with the Company's advisers or Directors and their other commitments.

The Directors consider that length of service does not of itself impair their ability to act independently, rather, a long-serving Director can offer a perspective that adds value to the deliberations of a well-balanced investment trust company board.

It is considered by the Board that, with the exception of Mr Duffield, all of the Directors are independent. The Board specifically considered the independence of Mr Gamble at his appointment, who has an immaterial holding in Brompton Asset Management Group LLP and concluded that he is an independent Director. The biographies of the Directors holding office at the date of this report demonstrate a breadth of investment and commercial experience relevant to their positions as Directors. All Directors have a wide range of other interests and are not dependent on the Company itself.

The Board considers that as in previous years, given its small size and the size and nature of the Company's operations, it is unnecessary to nominate one Director as a Senior Independent Director and both non-executives accordingly perform these duties.

Directors' appointment, retirement and rotation

The Board may appoint directors without shareholder approval. Any Director so appointed must stand for election by shareholders at the next AGM in accordance with the Articles of Association.

Under the Articles of Association one-third of Directors are required to retire by rotation each year. As two of the directors have been in office for more than nine years, all Directors have stood for re-election each year, in recent years. The UK Corporate Governance Code ('Code') now requires all Directors to stand for re-election annually. All the Company's directors will stand for re-election at the Company's Annual General Meeting in 2020, all being eligible.

Mr Howard-Spink stands for re-election annually by virtue of having served on the Board for more than nine years. The Board considers the leadership and contribution by Mr Howard-Spink to its deliberations continues to be extremely valuable, and he continues to exhibit independence of character and judgment. The Board accordingly strongly recommends that shareholders vote in favour of Mr Howard-Spink'sre-election.

Mr Duffield and Mr Gamble also stand for re-election, being eligible. The Board considers the contribution by both Mr Duffield and Mr Gamble on investment matters, company strategy and governance and on investment trust matters to be very valuable, notwithstanding that Mr Duffield is not deemed an independent director. The Directors therefore strongly recommend that shareholders vote in favour of both their re-election to the Board.

Mr Duffield has a beneficial interest in 59.14% of the Company's shares and is the senior partner of the Investment Manager's parent entity, for these reasons he is not considered to be independent by the Board.

19

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

In specific circumstances, shareholders may remove a director before the end of their term of office by passing an ordinary resolution at a general meeting. An ordinary resolution is passed if more than 50% of the votes cast in person or by proxy are in favour of the resolution.

Directors' remuneration

The Board consists solely of non-executive directors and accordingly the Company is not required to comply with the principles of the Code in relation to executive directors' remuneration, nor does it have a Remuneration Committee. Details of the fees paid to the Directors can be found in the Directors' Remuneration Report on page 34.

MANAGEMENT ARRANGEMENTS

The Company has no executive directors or employees. The day-to-day management and administration of the Company, including investment management, accounting and company secretarial matters, and custodian arrangements are delegated to specialist third party companies.

Investment management services

The Company's investments are managed by Brompton (the 'Investment Manager'). This relationship is governed by an agreement dated 17 May 2018. The portfolio manager is Gill Lakin.

Brompton receives a management fee, payable quarterly in arrears, equivalent to an annual

0.75 per cent of total assets after the deduction of the value of any investments managed by the Investment Manager or its associates (as defined in the investment management agreement). The investment management agreement may be terminated by either party giving three months written notice to expire on the last calendar day of any month.

For the first six months of the year, the Investment Manager was also entitled to a performance fee of 15 per cent of the growth in net assets over a hurdle of 3 month Sterling LIBOR plus 1 per cent per annum, payable six monthly in arrears, subject to a high watermark. The aggregate of the Company's management fee and performance fee were subject to a cap of 4.99 per cent of net assets in any financial year (with any performance fee in excess of this cap capable of being earned in future years).

During the year under review the investment management fee amounted to £697,000 (2019: £688,000). The performance payable for the year ended 30th June 2020 was £623,000 (2019:

£410,000).

The Independent Directors reviewed the performance and terms of Brompton as Investment Manager. It was announced in November 2019 that the existing performance fee basis was not appropriate in a low interest rate environment and it was agreed that the existing performance fee agreement would cease from 1 January 2020. The Directors believe that it is in the best interests of all the shareholders to continue the appointment of the Investment Manager on their existing terms of appointment having had regard to the Group's performance in recent periods.

20

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

Secretarial, administration and accounting services

Company secretarial services, general administration and accounting services for the Company are undertaken by Maitland Administration Services Limited (the 'Administrator').

Custodian services

Brown Brothers Harriman & Co is the independent custodian to the Company.

RELATED PARTY TRANSACTIONS

Mr Duffield is the senior partner of Brompton Asset Management Group LLP, the ultimate parent of the Investment Manager. Details of fees paid to the Investment Manager are given on page 20 and in note 3 on page 60.

SHARE CAPITAL AND SHAREHOLDERS

Share capital

The Company's share capital comprises 71,023,695 Ordinary shares of 1p each (2019: 71,023,695),

all of which are issued and fully paid. No shares are held in treasury (2019: nil). The Company did not issue or repurchase any shares during the year or up to the date of this report.

There are no restrictions on the transfer of the Company's shares other than: a) transfers by Directors and Persons Discharging Managerial Responsibilities and their connected persons during prohibited periods under the rules of the FCA or which may constitute insider dealing;

1. transfers for more than one class of share; c) transfers to more than 4 joint transferees; and d) transfers of shares which are not fully paid up or on which the Company has a lien provided that such would not prohibit dealings taking place on an open and proper basis.

The Company is not aware of any arrangements between shareholders or between the Company and any shareholders which restrict the transfer of shares or which would take effect or terminate in the event of a change of control of the Company.

The voting rights of the Ordinary shares on a poll are one vote for every share held.

Shareholders are entitled to such dividends (if any) as the Board may from time to time declare, and on a winding up are entitled to a distribution of such surplus assets (if any) as may remain after settling the liabilities of the Company, in proportion to the number of shares held and the respective amounts paid up or credited as paid up on their shares.

Substantial share interests

At 30th June 2020 and 4th September 2020, the Company was aware of the following interests which represent 3% or more of the voting rights in the Company:

21

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

Substantial share interests
Shareholder	% of voting rights	% of voting rights
	30th June 2020	4th September 2020
J L Duffield	59.1	59.1
Miton Asset Management Ltd	4.2	4.2
M R L Astor	3.9	3.9
Armstrong Investments Ltd	3.2	3.2

Relations with shareholders

The Board and Investment Manager are available for dialogue with shareholders. The primary mediums through which the Company communicates with its shareholders are the Half Year Report and the Annual Report and Accounts which aim to provide shareholders with a clear understanding of the Company's activities and its results. The Company's Annual Report and Accounts and Half Year Report are also published on the Company's website at: www.nsitplc. com and net asset values are published on the London Stock Exchange and the Company's website on a monthly basis.

It is currently intended that all shareholders will have the opportunity to attend and vote at the AGM during which the Directors and Investment Manager will be available to answer questions regarding the Company. However, in finalising arrangements for the meeting the directors will take account of prevailing government guidance at the time, and if necessary the meeting may be held as a closed meeting. Further information would be given to shareholders in those circumstances.

The Company will generally seek to provide twenty working days' notice of the AGM.

The Notice of Meeting sets out the business of the AGM and any item not of an entirely routine nature is explained in the Directors' Report or, where applicable, in the Notice of Meeting. Separate resolutions are proposed for each substantive issue.

GOING CONCERN

The Directors have undertaken a review of the Group's ability to continue as a going concern, specifically considering the impact of the Covid-19 pandemic, including its potential impact on asset values, liquidity, income and third party operational sustainability. The Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the accounts as the assets of the Company consist mainly of securities that are readily realisable or cash and it has no significant liabilities. This is discussed further in the viability statement on page 16.

DIRECTOR INDEMNIFICATION

As permitted by the Company's Articles of Association, each Director has the benefit of an indemnity which is a qualifying third party indemnity, as defined by section 234 of the Companies Act 2006.

22

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

SUBSIDIARY

The Company owns the whole of the issued share capital (£1) of JIT Securities Limited, a dormant investment company registered in England and Wales. The results of JIT Securities Limited are included in the consolidated financial statements.

INDEPENDENT AUDITOR

Ernst & Young LLP have indicated their willingness to remain in office. Accordingly a resolution proposing the re-appointment of Ernst & Young LLP until the close of the next general meeting at which accounts are laid before members, and to authorise the Directors to determine their remuneration, will be put to shareholders at the forthcoming AGM.

DIRECTORS' STATEMENT AS TO THE DISCLOSURE OF INFORMATION TO THE AUDITORS

The Directors who were members of the Board at the time of approving this Report are listed on page 4. Each of those Directors confirms that:

• to the best of his knowledge and belief, there is no information relevant to the preparation of the Report and Accounts of which the Company's auditors are unaware; and
• he has taken all the steps a director might reasonably be expected to have taken to be aware of relevant audit information and to establish that the Company's auditors are aware of that information.

ANNUAL GENERAL MEETING

The AGM of the Company will be held at 1 Knightsbridge Green, London, SW1X 7QA on Thursday, 12th November 2020 and will commence at 11.00 am. Due to the ongoing situation surrounding Covid-19 and advice from the UK Government the Board has decided to revise the format of this years' AGM. Whilst the formal business of the AGM will be considered, the meeting will be functional only, with only the minimum quorum of shareholders present to carry out the business of the meeting. Other shareholders will not be permitted to attend.

Shareholders' views are important and the Board encourages shareholders to exercise their votes in respect of the meeting in advance, by completing and returning their proxy forms. This will ensure that the votes are registered.

In addition, shareholders may also submit questions in advance of the AGM to the Company Secretary via email to [e-mail] or by post to the Company Secretary at the address set out on page 3 of this report.

A presentation from the Investment Manager will be placed on the Company's website for shareholder reference shortly after the AGM.

In the event that the situation changes the Company will update shareholders through an announcement to the London Stock Exchange and on the Company's website.

The notice of meeting can be found on pages 77 to 79.

23

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

SPECIAL BUSINESS AT THE AGM

In addition to the Ordinary business to be transacted at the forthcoming Annual General Meeting, Resolutions 8 and 9 will be proposed as Ordinary Resolutions and Resolutions 10 to 14 will be proposed as Special Resolutions.

Resolution 8 relates to the proposed Remuneration Policy set out on page 33, which, if approved, will take effect immediately after the AGM. There are no changes to the policy that is already in place.

Resolution 9 seeks renewal of the general and unconditional authority for the Directors to allot shares. The authority can be sought for up to 5 years but is put to shareholders annually. The Directors do not currently have any plans to exercise this authority if granted under this Resolution.

Resolution 10 proposes an amendment to the Articles of Association to provide greater flexibility over the holding of the AGM given the current Covid-19 environment. An amendment to the Company's Articles of

Association is proposed to enable the Company to hold shareholder meetings whereby shareholders are not required to attend the meeting in person at a physical location. This will facilitate shareholder attendance in situations where they are prevented, through laws or regulations, from attending at a physical location. The Directors have no present intention of holding 'virtual-only' meetings.

A copy of the proposed new Articles of Association of the Company together with a copy of all of the proposed changes to the existing Articles of Association will be available on the company's website and at the offices of the Company at 1 Knightsbridge Green, London SW1X 7QA from the date of the notice of the AGM to the close of the AGM.

Resolution 11 would allow the Company to allot a limited number of equity securities without applying pre-emption rights. Again, the Directors do not currently have any plans to exercise this authority but consider it desirable and in the Company's interest to have the authority in place.

Resolution 12 is to seek renewal of the existing authority for the Company to make market purchases of the Company's shares. The authority is limited to 10,646,450 Ordinary shares representing approximately 14.99% of the current issued Ordinary share capital. No market purchases have yet been made but the Directors feel it is important to have the ability to make purchases and the Directors would only exercise the authority, if granted, if they considered it to be in the Company's best interest. Any Ordinary shares bought back would be cancelled or held in treasury at the discretion of the Directors.

Resolution 13 would give the Directors discretion to re-issue Ordinary shares held in treasury into the market. Shares would not be re-issued at a price below the most recent published net asset value prior to re-issue.

24

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REPORT

for the year ended 30th June 2020

DIRECTORS' REPORT continued

Resolution 14 will enable the Directors to call general meetings (other than an Annual General Meeting) at not less than 14 days' notice rather than 21 days. Ordinarily the Directors would expect to give the full notice period but circumstances might make it desirable to call a meeting on shorter notice. A general meeting may only be called on short notice if it complies with certain conditions.

The Directors strongly recommend that shareholders vote in favour of all Resolutions being put to the annual general meeting, as they themselves intend to vote in respect of their own beneficial shareholdings totalling 42,003,223, being approximately 59.14% of the Ordinary share capital in issue at the date of this report.

For and on behalf of the Board of Directors Maitland Administration Services Limited Corporate Secretary

30th September 2020

25

NEW STAR INVESTMENT TRUST PLC

CORPORATE GOVERNANCE STATEMENT

for the year ended 30th June 2020

CORPORATE GOVERNANCE STATEMENT

APPLICABLE GOVERNANCE CODE

Throughout the year under review the Company applied the UK Corporate Governance Code issued by the Financial Reporting Council ('FRC') in July 2018 (the 'Code'), and had regard to the Code of Corporate Governance issued by the Association of Investment Companies in February 2019 (the 'AIC Code') which provides specific corporate governance guidance for investment trusts, if they are members of the AIC. The Company has not taken advantage of the AIC's exemptions as it is not a member of the AIC. Full details of the Company's corporate governance arrangements and instances of non-compliance are given below.

The Code referred to above can be found on the FRC's website at www.frc.gov.uk

STATEMENT OF COMPLIANCE

It is considered that the Company has complied with the provisions of the Code subject to the exceptions explained below and on page 19: the chairman has been a director for more than nine years (Code provision 10); the Company has not appointed a Senior Independent Director (Code provision 12); and it does not have a Nominations Committee (Code provision 17).

THE BOARD

Responsibilities of the Board

The Board is responsible for the effective stewardship of the Company's affairs. It determines the strategic direction of the Company and sets the boundaries within which the Investment Manager operates. The Board meets at least four times a year and reviews the Company's investment policy, performance and financial position. The Investment Manager takes decisions as to the purchase and sale of individual investments and is responsible for effecting those decisions on the best available terms. There is an agreed procedure for Directors, in the furtherance of their duties, to take independent professional advice at the Company's expense.

The Chairman is responsible for leading the Board and ensuring that it continues to deal effectively with all aspects of its role. In particular, he ensures that the Investment Manager and Administrator provide the Directors, in a timely manner, with management, regulatory and financial information that is clear, accurate and relevant. Representatives of the Investment Manager attend each Board meeting, enabling the Directors to seek clarification on specific issues or to probe further on matters of concern.

The Board comprises three non-executive Directors. In the light of the small size of the Board, it has been decided not to appoint a formal Nominations Committee and appointments of any new directors are considered by the Board in meeting as a whole.

Powers of the Directors

The powers of the Directors are set out in the Articles of Association which are publicly available from Companies House. Except as otherwise provided by regulation and legislation, the Directors may exercise all of the ordinary powers usually conferred on directors to manage the affairs of a company and to delegate such of those powers to committees, agents or individuals as they consider appropriate. The Directors may authorise the Company to borrow; to pay fees, expenses, salaries and make other payments to directors, executives and employees; and to provide pensions or other benefits for directors, executives and employees; but have not exercised these powers except for the payment of fees to non-executive directors.

26

NEW STAR INVESTMENT TRUST PLC

CORPORATE GOVERNANCE STATEMENT

for the year ended 30th June 2020

CORPORATE GOVERNANCE STATEMENT continued

Board attendance

Attendance at the Board and Audit Committee meetings held during the financial year is shown below.

	Quarterly	Audit committee
	Board meetings	meetings
No. of meetings	4	2
John Duffield	4	N/A
David Gamble	4	2
Geoffrey Howard-Spink	4	2

PERFORMANCE EVALUATION

THE COMPANY

The performance of the Company is considered in detail at each Board meeting.

The Board

The Board evaluates its own performance, that of the Audit Committee, and the performance of each Director and the Chairman on a regular basis. Because the Board comprises only three Directors, some of whom are members of all Committees, appraisals are carried out every two years rather than annually. Appraisals are conducted by the use of a tailored questionnaire designed to elicit views on all Board and Committee functions, followed by an opportunity to openly discuss the findings and ensure that effectiveness is maintained. A review was carried out during the year. The evaluation confirmed that the Board continues to perform effectively.

INTERNAL CONTROLS

The Board has overall responsibility for the establishment of the Company's systems of internal control and for reviewing their effectiveness. Internal control systems are designed to meet the particular requirements of the Company and to manage rather than eliminate the risks of failure to achieve its objectives. The systems by their very nature provide reasonable but not absolute assurance against material misstatement or loss. The Board has reviewed the effectiveness of the Company's internal control systems including the financial, operational and compliance controls and risk management processes for the period since 1st July 2019.

27

NEW STAR INVESTMENT TRUST PLC

CORPORATE GOVERNANCE STATEMENT

for the year ended 30th June 2020

CORPORATE GOVERNANCE STATEMENT continued

The key procedures which have been established with a view to providing effective internal control are as follows:

• Throughout the year under review, there has been an ongoing process for identifying, evaluating and managing the significant risks faced by the Company, which accords with the guidance in the FRC's Guidance on Risk Management, Internal Control and Related Financial and Business Reporting (September 2014). The process involves reports from the Company Secretary and Investment Manager on risk control and compliance, in conjunction with the Investment Manager's regular report which covers investment performance. In addition, the Company Secretary or Investment Manager report on the internal control environment at the Company's third party service providers. Internal control statements from third party service providers are also made available to the Audit Committee.
• The Audit Committee reviews a risk matrix prepared by the investment manager at its 6 monthly meetings and considers whether there are any emerging risks.
• The duties relating to investment management, accounting and custody of assets are segregated; the procedures of the individual parties are designed to complement one another.
• Investment management is performed by Brompton. The Board is responsible for setting the overall investment policy and monitors the activities of the Investment Manager at its regular meetings. The responsibilities of the Investment Manager are included in the Investment Management Agreement between the Company and Brompton. Brompton is authorised and regulated by the Financial Conduct Authority.
• Custody of assets is undertaken by Brown Brothers Harriman & Co.
• Administration, accounting and company secretarial duties are performed by Maitland Administration Services Limited.
• Authorisation and exposure limits are set by the Board.
• The Company clearly defines the duties and responsibilities of its agents through their contracts. The appointment of agents and advisers is conducted by the Board after consideration of the quality of parties involved; the Board monitors their on-going performance and contractual arrangements. The Board reviews financial information produced by the Investment Manager and the Company Secretary on a regular basis.

ACCOUNTABILITY AND RELATIONSHIP WITH INVESTMENT MANAGER

The Statement of Directors' Responsibilities in respect of the accounts is set out on page 36. The responsibilities of the independent auditor are set out on pages 37 to 49. The Directors' Report states that the business is a going concern and confirmation of the Directors consideration on viability is on page 16.

The Board has delegated contractually to external third parties (including the Investment Manager) the management of the investment portfolio, custodial services (including safeguarding of assets), day to day accounting, company secretarial and administration duties, and registration services. Each of these contracts was entered into after consideration by the Board of the quality and cost of the services offered. The Board receives regular formal reports from the Investment Manager and ad hoc information as required.

28

NEW STAR INVESTMENT TRUST PLC

CORPORATE GOVERNANCE STATEMENT

for the year ended 30th June 2020

CORPORATE GOVERNANCE STATEMENT continued

STEWARDSHIP

The Board has delegated the voting of investee company shares to the Investment Manager. The Board is conscious that the majority of its investments are in diverse funds, and its holdings in quoted companies do not constitute positions of significant influence. The Investment Manager regularly informs the Board of any material developments in connection with any investments or investee companies.

CONFLICTS OF INTEREST

The Board has put in place a framework for Directors to report conflicts of interest or potential conflicts of interest, which it believes works effectively. Directors are aware that they have a continuing obligation to notify the Company Secretary of all existing, new and potential situations or interests which do or could conflict with the interests of the Company. All disclosed situations and interests are reviewed by the Board at its meetings and, where appropriate, authorised. It is the Board's intention to continue to review all notified situations on a regular basis.

29

NEW STAR INVESTMENT TRUST PLC

REPORT OF THE AUDIT COMMITTEE

for the year ended 30th June 2020

AUDIT COMMITTEE

Composition of the Audit Committee

The Board has established an Audit Committee which consists of Mr Gamble (Chairman) and Mr Howard-Spink. Mr Gamble was appointed Chairman of the Committee on becoming a director in 2017. Mr Howard-Spink is a member of the Audit Committee to ensure there are two independent directors on the committee. Both committee members are considered by the Board to be independent of the Investment Manager. It is considered that each of the members of the Audit Committee has recent and relevant financial experience, and of the sector in which the Company operates.

The terms of reference for the Audit Committee are available on the Company's website: www.nsitplc.com

Role of the Audit Committee

The Audit Committee meets at least twice per year and operates within clearly defined terms of reference. The Committee provides a forum through which the Company's external auditor reports to the Board.

The main work and responsibilities of the Audit Committee include:

• monitoring the integrity of the Company's annual and half yearly financial statements together with the appropriateness of its accounting policies;
• considering whether the annual financial statements are fair, balanced and understandable;
• considering the Company's key and emerging risks and the risk matrix prepared by the Investment Manager;
• considering the nature and scope of the external audit and the findings therefrom;
• considering the need for establishing an internal audit function;
• overseeing the relationship with the external auditor, including assessing the independence and objectivity of the auditor, the effectiveness of the auditor and any non-audit services provided; and
• reviewing the investment management agreement and any proposed alterations to the investment management agreement.

Significant accounting matters considered by the Audit Committee

As part of the Audit Committee's review of the 2020 Annual Report and Accounts, the Committee considered the following significant issues, including the consideration of principal risks and uncertainties in light of the Company's activities and issues communicated by the Auditor during their work.

Valuation of the investment portfolio: Over 92% of the portfolio excluding cash has been verified by daily or monthly market prices. The valuation of the remainder of the portfolio, which is more subjective, is reviewed separately by the Investment Manager, the Audit Committee and the Auditor. The Audit Committee reviewed the Investment Manager's detailed valuation paper covering the basis adopted for valuing each unquoted company.

30

NEW STAR INVESTMENT TRUST PLC

REPORT OF THE AUDIT COMMITTEE

for the year ended 30th June 2020

AUDIT COMMITTEE continued

Ownership of the investment portfolio: The Company uses the services of an independent global custodian, Brown Brothers Harriman & Co. The Investment Manager and Administrator reconcile their records to those of the custodian. The Auditor obtains independent confirmation of the holdings from the custodian at the year end.

Volatility and uncertainty due to the Covid pandemic: The Audit Committee received updates from the Investment Manager regarding the market volatility resulting from the Covid pandemic during the year and the impact on the unquoted portfolio. The Committee reviewed the risks arising from a macro-economic event.

Compliance with The Investment Trust (Approved Company) (Tax) Regulations 2011: compliance with these regulations is essential to maintaining the taxation benefits of being an Investment Company for UK tax purposes. Schedules are prepared by the Administrator to confirm ongoing compliance and there is an additional review at the year-end by the Investment Manager and the Auditor.

Performance fee: the audit committee discussed the calculation of the performance fee with the manager and the auditor, to ensure that the fee had been correctly calculated. No matters arose from the review.

Recognition of income: the accounting treatment of special dividends or deemed income could impact the split between income and capital and the minimum dividend payable. There was one immaterial and no special dividend or deemed income during the year.

EXTERNAL AUDITOR

Auditor independence and performance

The Audit Committee makes recommendations to the Board regarding the appointment and independence of the external Auditor, Ernst & Young LLP, and assesses the objectivity and effectiveness of the audit process. Representatives of Ernst & Young LLP attended the Audit Committee meeting at which the draft Annual Report and Accounts were considered. They also engage with the Directors as and when required. Details of the amounts payable to the Auditor during the year under review, for audit and other services, are set out in note 4 on page 60.

The effectiveness of the audit was assessed by considering the Auditor's direct engagement with the Audit Committee, the auditors' written reports and from feedback from the Investment Manager and the Administrator.

In addition to the statutory audit of the Annual Report and Accounts, Ernst & Young LLP also provided a review of the half year report, which was subject to approval by the Audit Committee prior to engagement.

Ernst & Young LLP have audited the Company's financial statements since the inception of the Company in 2000 and the current Audit Partner, Caroline Mercer, is in her fourth year. Ernst & Young LLP can continue to audit the accounts through the year ended 2023. No audit tender has been undertaken.

31

NEW STAR INVESTMENT TRUST PLC

REPORT OF THE AUDIT COMMITTEE

for the year ended 30th June 2020

AUDIT COMMITTEE continued

The auditor does not provide the Company with any non-audit services, other than the half-year review. The Board concluded, on the recommendation of the Audit Committee, that the Auditor continues to be independent of the Company and the Investment Manager and recommends their reappointment.

Other Matters

In common with many investment trusts, the Company does not have a whistle-blowing policy. The main functions of the Company are delegated to third parties and the Audit Committee believes that it is appropriate to rely on the whistle-blowing policies operated by those third parties.

The Company does not have any employees and its day-to-day operations are delegated to third parties. The Board has determined that, in view of these circumstances, there is no need for the Company to have an internal audit function. The Directors review periodically whether a function equivalent to internal audit is needed and will continue to monitor its systems of internal controls in order to provide assurance that they operate as intended.

Approved by the Audit Committee and signed on its behalf by:

David Gamble

Chairman - Audit Committee

30th September 2020

32

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REMUNERATION REPORT

for the year ended 30th June 2020

ANNUAL REPORT ON REMUNERATION

The Directors are pleased to present their report on remuneration. An Ordinary resolution, to approve the Directors' Remuneration Policy (the 'Policy') (which is binding) was put to the 2017 AGM and approved and the Directors will accordingly seek renewal of the policy by shareholders at the forthcoming AGM. As is now customary, an Ordinary resolution to adopt this report (which is advisory) will also be proposed for approval by shareholders at the forthcoming AGM.

The Auditor is required to report to the Company's members on certain parts of the Directors' Remuneration Report and to state whether in their opinion those parts of the report have been properly prepared in accordance with the Act. Where information set out below has been audited, it is clearly indicated. The Auditor's opinion is included within the Independent Auditor's Report on pages 37 to 49.

This report has been prepared in accordance with Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (as amended). It describes the Policy and how it was implemented for the year to 30th June 2020.

The Board does not consider it necessary or appropriate to establish a separate Remuneration Committee as the Company has no employees, the Board is small, and there are no executive Directors. Non-executive Directors' remuneration is determined by the Board in line with the Policy below.

REMUNERATION POLICY

The Company's policy is that the remuneration of non-executive Directors should reflect the experience of the board as a whole, be fair and comparable to that of other investment trusts that have a similar capital structure (ordinary shares), and have a similar investment objective (long- term capital growth).

Under the current remuneration policy, the non-executive Directors of the Company are entitled to such rates of annual fees as the Board, at its discretion determines, subject to an aggregate ceiling of £100,000.

No Director shall be entitled to any benefits in kind, share options, long-term incentives, pension or other retirement benefits or compensation for loss of office. It is considered that no part of the Directors' remuneration should be performance related in the light of their non-executive status. Directors are entitled to reimbursement of expenses in respect of duties undertaken in connection with the management of the Company.

If the shareholders approve the policy this year, the policy will be put to shareholders again for renewal of their approval at intervals of not more than three years, and less if a change to the policy is proposed. If changes to the adopted policy are proposed, they can only take effect after shareholders have approved the changes in general meeting.

DIRECTORS' SERVICE CONTRACTS

It is the Board's policy that none of the Directors has a service contract. Any Director may be removed without notice and no compensation will be due on leaving office.

33

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REMUNERATION REPORT

for the year ended 30th June 2020

ANNUAL REPORT ON REMUNERATION continued

VOTING AT AGM

There are no significant changes proposed either to the Remuneration Policy or to the way that the Remuneration Policy will be implemented during the course of the next financial year.

The current policy was last approved at the AGM held on 16th November 2017, at which 100% of the votes were in favour and 0% were against. At last year's AGM, the Directors' Remuneration Report was also approved; 99.98% voted in favour and 0.02% voted against.

DIRECTORS' FEES (AUDITED)

The table below shows the rates of annual fees payable to the highest paid Director, the Chairman, and all other non-executive Directors for the year to 30th June 2020 and the year to 30th June 2019:

	2020	2019
	(£)	(£)
Chairman	25,000	20,000
Board member	20,000	15,000

On 13th June 2019 the Board resolved to increase the Chairman's fee to £25,000 and other Board members to £20,000, effective 1 July 2019.

DIRECTORS' EMOLUMENTS (AUDITED)

The single total figure of remuneration for each Director for the year to 30th June 2020 is detailed below together with the prior year comparative. Emoluments were received solely in the form of fees.

Name of Director	Fees paid/Total (£)
	2020	2019
J L Duffield	20,000	15,000
D J Gamble	20,000	15,000
G Howard-Spink	25,000	20,000
Total	65,000	50,000

RELATIVE IMPORTANCE OF SPEND ON PAY

The fees payable in respect of Mr Duffield's services are paid to the Investment Manager. The Company has no executive directors. Distributions made to shareholders by way of dividend have no correlation to Directors' remuneration. Any comparison would not be meaningful.

DIRECTORS' INTERESTS IN SHARES (AUDITED)

The interests of the Directors in the Ordinary shares of the Company at the beginning and end of the financial year are shown in the table below.

34

NEW STAR INVESTMENT TRUST PLC

DIRECTORS' REMUNERATION REPORT

for the year ended 30th June 2020

ANNUAL REPORT ON REMUNERATION continued

	30th June	30th June
Ordinary shares of 1p beneficial:	2020	2019
J L Duffield	42,003,223	42,003,223
D J Gamble	-	-
G Howard-Spink	-	-

There have been no changes in the Directors' interests in the period from 30th June 2020 to the date of this report.

YOUR COMPANY'S PERFORMANCE

The graph below compares the share price total return (assuming all dividends are reinvested) since 31 December 2009 against the IA Mixed Investment 40-85% (total return). The data has been rebased to 100 at 31st December 2009.

210
190
170
150
130
110
90
70
Dec	09	Jun	10	Dec	10	Jun	11	Dec	11	Jun	12	Dec	12	Jun	13	Dec	13	Jun	14	Dec	14	Jun	15	Dec	15	Jun	16	Dec	16	Jun	17	Dec	17	Jun	18	Dec	18	Jun	19	Dec	19	Jun	20

New Star Inv Trust TR	IA Mixed Investment 40-85% Shares TR
MSCI UK Index TR	Source: Thomson Reuters

By order of the Board Geoffrey Howard-SpinkChairman

30th September 2020

35

NEW STAR INVESTMENT TRUST PLC

STATEMENT OF DIRECTORS' RESPONSIBILITIES

for the year ended 30th June 2020

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the financial statements in accordance with applicable United Kingdom law and regulations. Company law requires the Directors to prepare Financial Statements for each financial year. Under that law, the Directors are required to prepare Financial Statements under International Financial Reporting Standards ('IFRSs') as adopted by the European Union.

Under Company Law, the Directors must not approve the Group's Annual Report and Accounts unless they are satisfied that they give a true and fair view of the financial position of the Group and the financial performance and cash flows of the Group for that period. In preparing those Group's Annual Report and Accounts the Directors are required to:

• select suitable accounting policies in accordance with International Accounting Standard ('IAS') 8: Accounting Policies, Changes in Accounting Estimates and Errors and apply them consistently;
• present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
• provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Group's financial position and financial performance;
• state that the Group has complied with IFRSs, subject to any material departures disclosed and explained in the financial statements; and
• prepare a Directors' Report and Directors' Remuneration Report which comply with the requirements of the Companies Act 2006.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group'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 and Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors have concluded that the Group's Annual Report and Accounts for the year ended 30th June 2020, taken as a whole, is fair, balanced and understandable, and provide the information necessary for shareholders to assess the performance, business model and strategy of the Group.

STATEMENT UNDER DISCLOSURE GUIDANCE AND TRANSPARENCY RULE 4.1.12

The Directors of the Company each confirm to the best of their knowledge that:

1. the financial statements have been prepared in accordance with IFRSs, as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group; and
2. the Annual Report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties they face.

For and on behalf of the Board of Directors Maitland Administration Services Limited Secretary

30th September 2020

36

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT

OPINION

In our opinion:

• New Star Investment Trust Plc's Group financial statements and Parent Company financial statements (the "financial statements") give a true and fair view of the state of the Group's and of the Parent Company's affairs as at 30th June 2020 and of the Group's profit for the year then ended;
• the Group financial statements have been properly prepared in accordance with International Financial Reporting Standards ("IFRSs") as adopted by the European Union;
• the Parent Company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union as applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006, and, as regards the Group financial statements, Article 4 of the IAS Regulation.

We have audited the financial statements of New Star Investment Trust Plc which comprise:

Group	Parent Company
Consolidated Statement of Comprehensive	Company Statement of Changes in Equity
Income for the year ended 30th June 2020.	for the year ended 30th June 2020.
Consolidated Statement of changes in Equity	Company Balance Sheet as at 30th June 2020.
for the year ended 30th June 2020.
Consolidated Balance Sheet as at 30th June	Company Cash Flow Statement for the year
2020.	ended 30th June 2020.
Consolidated Cash Flow Statement for the year	Related notes 1 to 20 to the financial
ended 30th June 2020.	statements, including a summary of
	significant accounting policies.
Related notes 1 to 20 to the financial
statements, including a summary of significant
accounting policies.

The financial reporting framework that has been applied in their preparation is applicable law and (IFRSs) as adopted by the European Union and, as regards the Parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

BASIS FOR OPINION

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report below. We are independent of the Group and Parent Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

37

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to principal risks, going concern and viability statement

We have nothing to report in respect of the following information in the annual report, in relation to which the ISAs(UK) require us to report to you whether we have anything material to add or draw attention to:

• the disclosures in the annual report set out on page 14 that describe the principal risks and explain how they are being managed or mitigated;
• the directors' confirmation set out on page 14 in the annual report that they have carried out a robust assessment of the emerging and principal risks facing the entity, including those that would threaten its business model, future performance, solvency or liquidity;
• the directors' statement set out on page 22 in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the entity's ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements
• whether the directors' statement in relation to going concern required under the Listing Rules in accordance with Listing Rule 9.8.6R(3) is materially inconsistent with our knowledge obtained in the audit; or
• the directors' explanation set out on page 16 in the annual report as to how they have assessed the prospects of the entity, over what period they have done so and why they consider that period to be appropriate, and their statement as to whether they have a reasonable expectation that the entity will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions.

Overview of our audit approach

Key audit	• Risk of incomplete and/or inaccurate revenue recognition, including
matters	classification of special dividends as revenue or capital items in the
	Statement of Comprehensive Income
	• Risk of inappropriate valuation and/or defective title to the investment
	portfolio
	• Impact of COVID-19
Audit scope	• We performed an audit of the complete financial information of New Star
	Investment Trust Plc and its subsidiary, JIT Securities Limited, in accordance
	with applicable law and International Standards on Auditing (UK).
	• All audit work was performed directly by the audit engagement team.
Materiality	• Overall Group materiality of £1.1m (2019: £1.1m) which represents 1%
	of net assets.

38

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.

Risk	Our response to the risk	Key observations
		communicated to the Audit
		Committee
Incomplete and/or inaccurate	We have performed the	The results of our procedures
revenue recognition,	following procedures:	are:
including classification of
special dividends as revenue	We obtained an	Based on our testing we
or capital items in the	understanding of the Manager	are satisfied that income
statement of comprehensive	and Administrator's processes	is materially complete
income (as described on page	and controls surrounding	and accurate and, in the
31 in the Report of the Audit	revenue recognition and the	case of special dividends,
Committee and as per the	recognition and classification	appropriately recognised as
accounting policy set out on	of special dividends by	revenue.
page 56).	performing walkthrough
	procedures to, in the case of
The total revenue for the year	special dividends, evaluate the
to 30th June 2020 was £2.4m	design and implementation of
(2019: £2.2m), consisting	controls.
primarily of dividend income
from the investment portfolio.	We agreed 100% of gross
	dividends received from
The total amount of special	the income report to an
dividends received by the	independent data vendor.
Group was £0.09m (2019: £nil),	We recalculated the dividend
all of which was classified as	income by multiplying the
revenue and is included in	investment holdings at the
total revenue for the year to	ex-dividend date, traced from
30th June 2020.	the accounting records, by the
	dividend per share as agreed
There is a risk of incomplete	to an external source. We also
and/or inaccurate recognition	agreed the exchange rates
of revenue through the failure	used to an external source and
to recognise proper income	the dividend amount received
entitlements or applying	to the bank statements.
appropriate accounting
treatment.

39

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Risk	Our response to the risk	Key observations
		communicated to the Audit
		Committee
In addition to the above,	To test completeness of
the directors are required	recorded income, we
to exercise judgment in	confirmed that all expected
determining whether income	dividends for each investee
receivable in the form of	company held during the year
special dividends should	had been recorded as income
be classified as 'revenue' or	with reference to investee
'capital'.	company announcements
	obtained from an independent
	data vendor.
	For all dividends accrued at
	the year end, we reviewed
	the investee company
	announcements to assess
	whether the obligation arose
	prior to 30th June 2020.
	We agreed the dividend
	rate to corresponding
	announcements made by
	the investee company and
	recalculated the dividend
	amount receivable.
	Recognising that a number
	of Companies have
	responded to the COVID-19
	pandemic by cancelling their
	dividend payments, for all
	accrued dividends received
	subsequent to year-end we
	traced the cash receipts to
	post year end bank statements
	to ensure that the accrued
	dividends had subsequently
	been received.

40

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Risk	Our response to the risk	Key observations
		communicated to the Audit
		Committee
	We identified all dividends
	above our testing threshold
	and from those then identified
	which of those were special
	dividends with reference to an
	external source. There was one
	special dividend above our
	testing threshold which was
	classified as revenue.
	We assessed the
	appropriateness of the
	management's classification
	of the special dividend
	which was above our testing
	threshold and agreed that
	the revenue treatment was
	appropriate.
Inappropriate valuation	We performed the following	The results of our procedures
and/or defective title of	procedures:	are:
the investment portfolio
(as described on page 30	We obtained an	Based on our testing we are
in the Report of the Audit	understanding of the	satisfied that the investment
Committee and as per the	Manager and Administrator's	portfolio valuation and
accounting policy set out on	processes and controls	existence are not materially
page 56).	surrounding investment	misstated.
	pricing of securities, including
The valuation of the	an understanding of the
portfolio at 30th June 2020	operation of the Manager's
was £103.0m (2019: £93.8m)	and the Director's process
consisting primarily of quoted	for review of the unquoted
investments with an aggregate	valuations by performing a
value of £94.5m (2019: £86.4m)	walkthrough in which we
and unquoted investments	evaluated the design and
with an aggregate value of	implementation of controls.
£8.5m (2019: 7.4m).

41

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Risk	Our response to the risk	Key observations
		communicated to the Audit
		Committee
The valuation of the assets	For all quoted investments in
held in the investment	the portfolio, we compared
portfolio is the key driver of	the market prices and
the Group's net asset value	exchange rates applied to
and total return.	an independent pricing
	vendor and recalculated the
Inappropriate investment	investment valuations as at
pricing, or a failure to	the year-end.
maintain proper legal title of
the investments held by the	In light of Covid-19 we
Group could have a significant	assessed the liquidity of the
impact on the portfolio	investment portfolio through
valuation and the return	analysing the monthly
generated for shareholders.	average trading volume of
	the equity investments and
The fair value of quoted	investment trusts. For open-
investments is determined	ended funds, we read their
by reference to bid price	fact sheets and noted that
or the last traded price	they invested in transferable
depending on the convention	securities which are readily
of the exchange on which the	realisable.
investment is quoted.	We agreed the Group's
Investments in units of unit	investments to the
trusts or shares in OEICs are	independent confirmation
valued at the bid price for	received from the Group's
dual priced funds, or single	Custodian at 30th June 2020.
price for non-dual priced
funds, released by the relevant	For each material unquoted
investment manager.	investment held as at the year-
	end, we utilised our specialist
Unquoted investments	Valuations and Business
are valued at fair value by	Modelling team to assess and
Directors following a detailed	corroborate the valuations.
review and appropriate	These included the following:
challenge of the valuations
proposed by the Investment	• Obtained and reviewed
Manager. The Investment	the Directors' valuation
Manager's unquoted	and assessed that these
investment policy applies	have been performed
the methodologies consistent	in line with the IPEVC
with the International	valuation guidelines.
Private Equity and Venture
Capital ('IPEVC') Valuation
Guidelines.

42

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Risk	Our response to the risk	Key observations
			communicated to the Audit
			Committee
The valuation of the unquoted	•	Assessed and challenged
investments, and the resultant		the appropriateness
impact on the Statement of		of the data inputs and
Comprehensive Income, is		assumptions used to
the area requiring the most		support the valuations.
significant judgment and
estimation in the preparation	•	Assessed and challenged
of the financial statements.		other factors and
		circumstances, such as
		market movement, recent
		transaction price, cost
		price and comparative
		company information,
		that have an impact on the
		fair market value of the
		investments.
	Recalculated the unrealised
	gains or losses recognised
	in the Statement of
	Comprehensive Income
	based on the valuation of the
	unquoted investments.
Impact of COVID-19(as	We performed the following	The results of our procedures
described on pages 15 and	procedures:	are:
16 in the Strategic Report,	Going concern:	Based on the procedures
10 in the Report of Audit
Committee and as per the	We obtained and reviewed	performed, we are satisfied
accounting policy set out on	that the Directors have
the Director's assessment of
page 55).	appropriately considered the
going concern which includes
	consideration of the impact	impact of
COVID-19 has had a
of COVID-19 and challenged	Covid-19 on the going
significant impact on markets
the assumptions made in the
and the wider economy. The	preparation of the assessment.	concern assessment and that
impact of COVID-19 has led			adequate disclosures have
to significant volatility in the			been presented in the financial
global public equity markets.			statements of the Group.
As COVID-19 continues to
spread, the potential impact,
including a global, regional
or other economic recession,
are uncertain and difficult to
assess.

43

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Risk	Our response to the risk	Key observations
		communicated to the Audit
		Committee
Going concern	We reviewed the revenue
There is increased risk due to	and expense forecast which
takes account of the impact
the degree of uncertainty in
COVID-19 may have on the
the assumptions underlying
Group and which supports
management's assessment of
the Directors' assessment of
future prospects, including the
impact of COVID-19 and the	going concern and challenged
the assumptions made by the
ability to fund ongoing costs.
Manager in the preparation of
Financial statement	the forecast.
disclosures	We confirmed through
There is a risk that the impact
discussion with the Company
of COVID-19 is not adequately	Secretary and the Directors
disclosed in the financial	that they are in close contact
statements.	with key service providers
Additional COVID-19	and that Business Continuity
Plans are in place with no
procedures have been	significant deterioration of
reflected above in the response	service being experienced.
to the key audit matters of
'Incomplete and/or inaccurate	Financial statements
revenue recognition, including	disclosures
classification of special	We reviewed the disclosures
dividends as revenue or
contained within the Annual
capital items in the Statement
Report and Financial
of Comprehensive Income'
Statements.
and 'Inappropriate valuation
and/or defective title to the
investment portfolio'.

We re-assessed the risks determined at the planning stage of the audit and, due to the uncertainty in global markets caused by the COVID-19 pandemic, we revised our risk assessment to include the Key Audit Matter 'Impact of COVID-19'. Our other Key Audit Matters are unchanged from our assessment for the year ended 30th June 2019.

44

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

An overview of the scope of our audit

Tailoring the scope

Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for each entity within the Group. Taken together, this enables us to form an opinion on the consolidated financial statements. We take into account size, risk profile, the organisation of the Group and effectiveness of group-wide controls, changes in the business environment and other factors such as recent Internal audit results when assessing the level of work to be performed at each entity.

All audit work performed for the purposes of the audit was undertaken by the Group audit team.

Our application of materiality

We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion.

Materiality

The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures.

We determined materiality for the Group to be £1.1 million (2019: £1.1 million), which is 1% (2019: 1%) of net assets. We believe that net assets provides us with the materiality aligned to the key measurement of the Group's measurement.

We determined materiality for the Parent Company to be £1.1 million (2019: £1.1 million), which

is 1% (2019: 1%) of net assets.

Performance materiality

The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.

On the basis of our risk assessments, together with our assessment of the Group's overall control environment, our judgment was that performance materiality was 75% (2019: 75%) of our planning materiality, namely £0.9m (2019: £0.8m). We have set performance materiality at this percentage due to our past experience of the audit that indicates a lower risk of misstatements, both corrected and uncorrected.

Given the importance of the distinction between revenue and capital for the Group, we also applied a separate revenue testing threshold of £0.06m (2019: 0.07m) for the revenue column of the Consolidated Statement of Comprehensive Income, being the greater of 5% of the revenue profit before tax and our reporting threshold which is set at 5% of planning materiality.

45

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Reporting threshold

An amount below which identified misstatements are considered as being clearly trivial.

We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £0.06m (2019: £0.06m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.

We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion.

Other information

The other information comprises the information included in the annual report set out on pages 5 to 36 and then 77 to 80, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact.

We have nothing to report in this regard.

In this context, we also have nothing to report in regard to our responsibility to specifically address the following items in the other information and to report as uncorrected material misstatements of the other information where we conclude that those items meet the following conditions:

• Fair, balanced and understandable set out on page 36 - The statement by the directors that they consider the annual report and financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's performance, business model and strategy, is materially inconsistent with our knowledge obtained in the audit; or
• Audit committee reporting set out on page 30 - the section describing the work of the audit committee does not appropriately address matters communicated by us to the audit committee; or
• Directors' statement of compliance with the UK Corporate Governance Code set out on page 26 - the parts of the directors' statement required under the Listing Rules relating to the company's compliance with the UK Corporate Governance Code containing provisions specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) do not properly disclose a departure from a relevant provision of the UK Corporate Governance Code.

46

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, the part of the directors' remuneration report to be audited has been properly prepared in accordance with the Companies Act 2006.

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
• the parent company financial statements and the part of the Directors' Remuneration Report to be audited are not in agreement with the accounting records and returns; or
• certain disclosures of directors' remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit

Responsibilities of directors

As explained more fully in the directors' responsibilities statement set out on page 36, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group and parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

47

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.

Our approach was as follows:

• We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and determined that the most significant are IFRSs as adopted by the European Union, the Companies Act 2006, AIC SORP, the Listing Rules, the AIC Code, the UK Corporate Governance Code, section 1158 of the Corporation Tax Act 2010, and the Companies (Miscellaneous Reporting) Regulations 2018.
• We understood how New Star Investment Trust Plc is complying with those frameworks through discussions with the Audit Committee, the Investment Manager (Brompton Asset Management LLP), and the Company Secretary (Maitland Administration Services Limited) and a review of the Group's documented policies and procedures.
• We assessed the susceptibility of the Group's financial statements to material misstatement, including how fraud might occur by considering the key risks impacting the financial statements. We identified fraud risks with respect to the incomplete and/or inaccurate income recognition through incorrect classification of special dividends and the incorrect valuation of unquoted investments and the resulting impact on the Statement of Comprehensive Income. Further discussion of our approach is set out in the section on key audit matters above.
• Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved review of the reporting to the directors with respect to the application of the documented policies and procedures and review of the financial statements to ensure compliance with the reporting requirements of the Group.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

48

NEW STAR INVESTMENT TRUST PLC

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS

OF NEW STAR INVESTMENT TRUST PLC

AUDITORS REPORT continued

Other matters we are required to address

• We were appointed by the Group on inception of the Parent Company to audit the financial statements for the period ending 5th May 2000 and subsequent financial periods.
• The period of total uninterrupted engagement including previous renewals and reappointments is 21years, covering the period ending 5th May 2000 to 30th June 2020.
• The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Group or the Parent Company and we remain independent of the group and the parent company in conducting the audit.
• The audit opinion is consistent with the additional report to the audit committee

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Caroline Mercer (Senior statutory auditor)

For and on behalf of Ernst & Young LLP, Statutory Auditor Edinburgh

2nd October 2020

49

NEW STAR INVESTMENT TRUST PLC

CONSOLIDATED STATEMENT OF

COMPREHENSIVE INCOME

INVESTMENT INCOME

Other operating income

GAINS AND LOSSES ON INVESTMENTS

(Losses)/gains on investments at fair value through profit or loss

Other exchange gains Trail rebates

EXPENSES

for the year ended 30th June 2020
		Year ended				Year ended
		30th June 2020			30th June 2019
Notes	Revenue		Capital		Revenue			Capital
		Return		Return	Total		Return			Return	Total
		£ '000		£ '000	£ '000		£ '000			£ '000	£ '000
2	2,169		-	2,169	1,890			-	1,890
2	250		-	250	349			-	349
	2,419		-	2,419	2,239			-	2,239

9	-	(212)	(212)		-	1,992	1,992
	-	414	414		-	443	443
	-	4	4		-	5	5
	2,419		206		2,625		2,239		2,440		4,679

Management and performance	3	(697)	(623)	(1,320)	(688)	(410)	(1,098)
fees
Other expenses	4	(397)			-		(397)		(266)		-		(266)
		(1,094)	(623)	(1,717)	(954)	(410)	(1,364)
PROFIT BEFORE TAX		1,325	(417)	908	1,285	2,031	3,315
Tax	5	-			-		-		-		-		-
PROFIT FOR THE YEAR		1,325	(417)	908	1,285	2,031	3,315
EARNINGS PER SHARE
Ordinary shares (pence)	7	1.87p			(0.59)p		1.28p		1.81p		2.86p		4.67p

The total column of this statement represents the Group's profit and loss account, prepared in accordance with IFRS, as adopted by the European Union. The supplementary Revenue Return and Capital Return columns are both prepared under guidance published by the Association of Investment Companies. All revenue and capital items in the above statement derive from continuing operations.

The Company did not have any income or expense that was not included in 'Profit for the year'. Accordingly, the 'Profit for the year' is also the 'Total comprehensive income for the year', as defined in IAS1 (revised) and no separate Statement of Comprehensive Income has been presented.

No operations were acquired or discontinued during the year.

All income is attributable to the equity holders of the parent company. There are no minority interests.

The Notes on pages 56 to 76 form an integral part of these Accounts.

50

NEW STAR INVESTMENT TRUST PLC

CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

for the year ended 30th June 2020

		Share		Share		Special	Retained
		capital premium		reserve	earnings		Total
	Notes	£ '000		£ '000		£ '000		£ '000		£ '000
AT 30th JUNE 2019		710	21,573	56,908	34,780	113,971
Total comprehensive income for the year		-		-		-	908	908
Dividend paid	8	-		-		-		(994)		(994)
AT 30th JUNE 2020		710	21,573	56,908	34,694	113,885

Included within Retained earnings were £2,018,000 of Company reserves available for distribution.

CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

for the year ended 30th June 2019

		Share		Share		Special		Retained
	Notes	capital		premium		reserve		earnings		Total
	£ '000		£ '000		£ '000		£ '000		£ '000
AT 30TH JUNE 2018		710	21,573	56,908	32,175	111,366
Total comprehensive income for the year		-		-		-	3,315	3,315
Dividend paid	8	-		-		-	(710)	(710)
AT 30TH JUNE 2019		710	21,573	56,908	34,780	113,971

Included within Retained earnings were £1,687,000 of Company reserves available for distribution.

The Notes on pages 56 to 76 form an integral part of these Accounts.

51

NEW STAR INVESTMENT TRUST PLC

COMPANY STATEMENT OF

CHANGES IN EQUITY

for the year ended 30th June 2020

		Share		Share		Special	Retained
		capital premium		reserve	earnings		Total
	Notes	£ '000		£ '000		£ '000		£ '000		£ '000
AT 30TH JUNE 2019		710	21,573	56,908	34,780	113,971
Total comprehensive income for the year		-		-		-	908	908
Dividend paid	8	-		-		-		(994)		(994)
AT 30TH JUNE 2020		710	21,573	56,908	34,694	113,885

Included within Retained earnings were £2,018,000 of Company revenue reserves available for distribution.

COMPANY STATEMENT OF

CHANGES IN EQUITY

for the year ended 30th June 2019

		Share		Share		Special	Retained
		capital premium		reserve	earnings		Total
	Notes	£ '000		£ '000		£ '000		£ '000		£ '000
AT 30TH JUNE 2019		710	21,573	56,908	32,175	111,366
Total comprehensive income for the year		-		-		-	3,315	3,315
Dividend paid	8	-		-		-		(710)		(710)
AT 30TH JUNE 2020		710	21,573	56,908	34,780	113,971

Included within Retained earnings were £1,687,000 of Company revenue reserves available for distribution.

The Notes on pages 56 to 76 form an integral part of these Accounts.

52

NEW STAR INVESTMENT TRUST PLC

CONSOLIDATED BALANCE SHEET

at 30th June 2020

		30th June		30th June
		2020	2019
	Notes		£ '000		£ '000
NON-CURRENT ASSETS
Investments at fair value through profit or loss	9	103,015	93,782
CURRENT ASSETS
Other receivables	11	137	220
Cash and cash equivalents	12	10,962	20,605
		11,099	20,825
TOTAL ASSETS		114,114	114,607
CURRENT LIABILITIES
Other payables	13	(229)	(636)
TOTAL ASSETS LESS CURRENT LIABILITIES		113,885	113,971
NET ASSETS		113,885	113,971
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS
Called-up share capital	14	710	710
Share premium	15	21,573	21,573
Special reserve	15	56,908	56,908
Retained earnings	15	34,694	34,780
		113,885	113,971
NET ASSET VALUE PER ORDINARY SHARE	16		160.35p		160.47p

These Accounts were approved by the Board of Directors and authorised for issue on 30th September 2020.

Geoffrey Howard-Spink

Chairman

New Star Investment Trust Plc

Registered in England & Wales No. 03969011

The Notes on pages 56 to 76 form an integral part of these Accounts.

53

NEW STAR INVESTMENT TRUST PLC

COMPANY BALANCE SHEET

at 30th June 2020

		30th June		30th June
		2020	2019
	Notes		£ '000		£ '000
NON-CURRENT ASSETS
Investment at fair value through profit or loss	9	103,015	93,782
Investments in subsidiary at fair value through profit or loss	10		506		506
		103,521	94,288
CURRENT ASSETS
Other receivables	11	137	220
Cash and cash equivalents	12	10,962	20,605
		11,099	20,825
TOTAL ASSETS		114,620	115,113
CURRENT LIABILITIES
Other payables	13	(735)	(1,142)
TOTAL ASSETS LESS CURRENT LIABILITIES		113,885	113,971
NET ASSETS		113,885	113,971
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS
Called-up share capital	14	710	710
Share premium	15	21,573	21,573
Special reserve	15	56,908	56,908
Retained earnings (1)	15	34,694	34,780
		113,885	113,971

• The profit for the year dealt with in the accounts of the Company is £908,000 (2019: £3,315,000)

These Accounts were approved by the Board of Directors and authorised for issue on 30th September 2020.

Geoffrey Howard-Spink

Chairman

New Star Investment Trust Plc

Registered in England & Wales No. 03969011

The Notes on pages 56 to 76 form an integral part of these Accounts.

54

NEW STAR INVESTMENT TRUST PLC

CASH FLOW STATEMENTS

for the year ended 30th June 2020

NET CASH INFLOW FROM OPERATING ACTIVITIES

INVESTING ACTIVITIES

	Year ended	Year ended	Year ended	Year ended
	30th June	30th June		30th June		30th June
	2020	2020	2019	2019
		Group	Company		Group	Company
Notes		£ '000		£ '000		£ '000		£ '000
	382	382	1,334	1,334

Purchase of investments		(12,725)	(12,725)	(4,340)	(4,340)
Sale of investments		3,280	3,280	8,851	8,851
NET CASH (OUTFLOW)/INFLOW FROM
	(9,445)	(9,445)	4,511	4,511
INVESTING ACTIVITIES
FINANCING
Equity dividends paid	8	(994)	(994)	(710)	(710)
NET CASH OUTFLOW AFTER
	(994)	(994)	(710)	(710)
FINANCING
(DECREASE)/INCREASE IN CASH		(10,057)	(10,057)	5,135	5,135
RECONCILIATION OF NET CASH FLOW
TO MOVEMENT IN CASH & CASH
EQUIVALENTS
(Decrease)/Increase in cash resulting
from cash flows		(10,057)	(10,057)	5,135	5,135
Exchange movements		414	414	443	443
Movement in net funds
	(9,643)	(9,643)	5,578	5,578
Net funds at start of the year		20,605	20,605	15,027	15,027
CASH & CASH EQUIVALENTS AT END
	10,962	10,962	20,605	20,605
OF YEAR	17
RECONCILIATION OF PROFIT BEFORE
FINANCE COSTS AND TAXATION TO
NET CASH FLOW FROM OPERATING
ACTIVITIES
Profit before finance costs and
taxation*		908	908	3,315	3,315
(Losses)/Gains on investments		212	212	(1,992)	(1,992)
Exchange differences		(414)	(414)	(443)	(443)
Capital trail rebates		(4)	(4)	(5)	(5)
Net revenue gains before finance
costs and taxation		702	702	875	875
Decrease in debtors		81	81	43	43
(Decrease)/Increase in creditors		(407)	(407)	402	402
Taxation		2	2	9	9
Capital trail rebates		4	4	5	5
NET CASH INFLOW FROM OPERATING
	382	382	1,334	1,334
ACTIVITIES

*Includes dividends received in cash of £1,977,000 (2019: £1,599,000), accumulation income of

£245,000 (2019: £278,000) and interest received of £270,000 (2019: £408,000).

The Notes on pages 56 to 76 form an integral part of these Accounts.

55

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

1. ACCOUNTING POLICIES

The financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS'). These comprise standards and interpretations approved by the International Accounting Standards Board ('IASB'), together with interpretations of the International Accounting Standards and Standing Interpretations Committee ('IASC') that remain in effect, and to the extent that they have been adopted by the European Union.

These financial statements are presented in pounds sterling, the Group's functional currency, being the currency of the primary economic environment in which the Group operates, rounded to the nearest thousand.

1. Basis of preparation: The financial statements have been prepared on a going concern basis (see 1(p)). The principal accounting policies adopted are set out below.
   Where presentational guidance set out in the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' ('SORP') issued by the Association of Investment Companies ('AIC') in November 2014 and updated in February 2018 and October 2019 with consequential amendments is consistent with the requirements of IFRS, the Directors have sought to prepare the financial statements on a basis compliant with the recommendations of the SORP.
2. Basis of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiary made up to 30th June 2020. No statement of comprehensive income is presented for the parent company as permitted by Section 408 of the Companies Act 2006.
   The Company is an investment entity as defined by IFRS 10 and assets are held at their fair value. The consolidated accounts include subsidiaries which are an integral part of the Group and not investee companies.
   Subsidiaries are consolidated from the date of their acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiary used in the preparation of the consolidated financial statements are based on consistent accounting policies. All intra- group balances and transactions, including unrealised profits arising therefrom, are eliminated. Subsidiaries are valued at fair value, which is considered to be their NAV, in the accounts of the Company.
3. Presentation of Statement of Comprehensive Income: In order to better reflect the activities of an investment trust company and in accordance with guidance issued by the AIC, supplementary information which analyses the consolidated statement of comprehensive income between items of a revenue and capital nature has been presented alongside the consolidated statement of comprehensive income.
   In accordance with the Company's Articles of Association, net capital returns may not be distributed by way of a dividend. Additionally, the net revenue profit is the measure the Directors believe is appropriate in assessing the Group's compliance with certain requirements set out in the Investment Trust (Approved Company) (Tax) Regulations 2011.

56

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

1. ACCOUNTING POLICIES continued

1. Use of estimates: The preparation of financial statements requires the Group to make estimates and assumptions that affect items reported in the consolidated and company balance sheets and consolidated statement of comprehensive income and the disclosure of contingent assets and liabilities at the date of the financial statements. Although these estimates are based on the Directors' best knowledge of current facts, circumstances and, to some extent, future events and actions, the Group's actual results may ultimately differ from those estimates, possibly significantly. The most significant estimate relates to the valuation of unquoted investments (see note 18(h)).
2. Revenue: Dividends and other such revenue distributions from investments are credited to the revenue column of the consolidated statement of comprehensive income on the day in which they are quoted ex-dividend. Where the Company has elected to receive its dividends in the form of additional shares rather than in cash and the amount of the cash dividend is recognised as income, any excess in the value of the shares received over the amount recognised is credited to the capital reserve. Deemed revenue from offshore funds is credited to the revenue account. Interest on fixed interest securities and deposits is accounted for on an accruals basis.
3. Expenses: Expenses are accounted for on an accruals basis. Management fees, administration and other expenses, with the exception of transaction charges, are charged to the revenue column of the consolidated statement of comprehensive income. Performance fees and transaction charges are charged to the capital column of the consolidated statement of comprehensive income.
4. Investments held at fair value: Purchases and sales of investments are recognised and derecognised on the trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe established by the market concerned, and are initially measured at fair value.
   All investments are classified as held at fair value through profit or loss on initial recognition and are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted. Investments in units of unit trusts or shares in OEICs are valued at the bid price for dual priced funds, or single price for non-dual priced funds, released by the relevant investment manager. Unquoted investments are valued by the Directors at the balance sheet date based on recognised valuation methodologies, in accordance with International Private Equity and Venture Capital ('IPEVC') Valuation Guidelines such as dealing prices or third party valuations where available, net asset values and other information as appropriate.
5. Taxation: The charge for taxation is based on taxable income for the year. Withholding tax deducted from income received is treated as part of the taxation charge against income. Taxation deferred or accelerated can arise due to temporary differences between the treatment of certain items for accounting and taxation purposes. Full provision is made for deferred taxation under the liability method on all temporary differences not reversed by the Balance Sheet date. No deferred tax provision is made against deemed reporting offshore funds. Deferred tax assets are only recognised when there is more likelihood than not that there will be suitable profits against which they can be applied.

57

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

1. ACCOUNTING POLICIES continued

1. Foreign currency: Assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the balance sheet date. Foreign currency transactions are translated at the rates of exchange applicable at the transaction date. Exchange gains and losses are taken to the revenue or capital column of the consolidated statement of comprehensive income depending on the nature of the underlying item.
2. Capital reserve: The following are accounted for in this reserve:
3. • gains and losses on the realisation of investments together with the related taxation effect;
   • foreign exchange gains and losses on capital transactions, including those on settlement, together with the related taxation effect;
   • revaluation gains and losses on investments;
   • performance fees payable to the investment manager; and
   • trail rebates received from the managers of the Company's investments.

The capital reserve is not available for the payment of dividends.

1. Revenue reserve: This reserve includes net revenue recognised in the revenue column of the Statement of Comprehensive Income.
2. Special reserve: The special reserve can be used to finance the redemption and/or purchase of shares in issue.
3. Cash and cash equivalents: Cash and cash equivalents comprise current deposits and balances with banks. Cash and cash equivalents may be held for the purpose of either asset allocation or managing liquidity.
4. Dividends payable: Dividends are recognised from the date on which they are irrevocably committed to payment.
5. Segmental Reporting: The Directors consider that the Group is engaged in a single segment of business with the primary objective of investing in securities to generate long term capital growth for its shareholders. Consequently no business segmental analysis is provided.
6. Going concern basis of preparation: The Directors considered the impact of Covid-19 pandemic and the impact this may have on the Group, in particular noting that, in addition to its significant cash balances the Group holds a highly liquid portfolio, which could be sold. The Directors also reviewed scenarios of a significant drop in value of the assets and falls in income received. They have also considered the resiliency of the Group's key service providers and are satisfied that they have worked adequately during the Covid-19 pandemic and are sustainable. Therefore, the going concern basis has been adopted in preparing the Group's financial statements.

58

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

1. ACCOUNTING POLICIES continued
2. 1. New standards, interpretations and amendments effective for the periods beginning on or after 1 July 2019: There are no new standards, amendments to standards and interpretations that are relevant to the Group and should be disclosed.
   2. New standards, interpretations and amendments issued which are not yet effective and applicable for the periods beginning on or after 1 July 2020: The following amendments to standards issued but are not yet effective are relevant and applicable to the Group, although they have no impact on the financial statements of the Group:
   3. • IFRS 3: Definition of a Business
      • Amendments to IFRS 9, IAS 39 and IFRS 7 - Interest Rate Benchmark Reform
      • Amendments to IAS 1 and IAS 8 - Definition of Material
3. INVESTMENT INCOME

	Year ended	Year ended
	30th June		30th June
	2020	2019
		£'000		£'000
INCOME FROM INVESTMENTS
UK net dividend income	1,844	1,691
Unfranked investment income		325		199
	2,169	1,890
OTHER OPERATING INCOME
Bank interest receivable	250	336
Loan interest income		-		13
	250	349
TOTAL INCOME COMPRISES
Dividends	2,169	1,890
Other income	250	349
	2,419	2,239

The above dividend and interest income has been included in the profit before finance costs and taxation included in the cash flow statements.

59

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

3. MANAGEMENT AND PERFORMANCE FEES

		Year ended			Year ended
		30th June 2020			30th June 2019
	Revenue		Capital	Total	Revenue		Capital	Total
		£'000		£'000	£'000		£'000		£'000	£'000
Investment management fee	697		-	697	688		-	688
Performance fee		-		623			623		-		410			410
	697	623			1,320	688	410			1,098

At 30th June 2020 there were amounts accrued of £177,000 (2019: £177,000) for investment

management fees and £nil (2018: £410,000) for performance fees.

A summary of the terms of the investment management agreement may be found in the Directors' Report on pages 20 and 21.

4. OTHER EXPENSES
	Year ended	Year ended
	30th June		30th June
	2020	2019
		£'000		£'000
Directors' remuneration	65	50
Administrative and secretarial fee	95	95
Auditors' remuneration
- Audit	32	32
- Interim review	8	8
Other	197	81
	397	266
Allocated to:
- Revenue	397	266
- Capital		-		-
	397	266

60

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

5. TAXATION

(a) Analysis of tax charge for the year:

		Year ended			Year ended
		30th June 2020			30th June 2019
	Revenue		Capital		Revenue		Capital
		Return		Return	Total		Return		Return	Total
		£'000		£'000	£'000		£'000		£'000	£'000
Overseas tax	1		-	1	3		-	3
Recoverable income tax	(1)		-	(1)	(3)		-	(3)
Total current tax for the year		-		-	-		-		-	-
Deferred tax		-		-	-		-		-	-
Total tax for the year (note 5b)		-		-	-		-		-	-

(b) Factors affecting tax charge for the year:

The charge for the year of £nil (2019: £nil) can be reconciled to the profit per the consolidated statement of comprehensive income as follows:

	Year ended		Year ended
	30th June		30th Juned
	2020	2019
		£'000			£'000
Total profit before tax	908	3,315
Theoretical tax at the UK corporation tax rate of 19.00%		172			630
(2019: 19.00%)
Effects of:
Non-taxable UK dividend income	(350)	(321)
Gains and losses on investments that are not taxable	(38)	(463)
Excess expenses not utilised	249	154
Overseas dividends which are not taxable	(33)			-
Overseas tax	1	3
Recoverable income tax	(1)	(3)
Total tax for the year		-			-

Due to the Company's tax status as an investment trust and the intention to continue meeting the conditions required to maintain approval of such status in the foreseeable future, the Company has not provided tax on any capital gains arising on the revaluation or disposal of investments.

There is no deferred tax (2019: £nil) in the capital account of the Company. There is no deferred

tax charge in the revenue account (2019: £nil).

At the year-end there is an unrecognised deferred tax asset of £643,000 (2019: £520,000) based on the enacted tax rates of 19% for financial years beginning 1st April 2020, as a result of excess expenses.

61

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

6. COMPANY RETURN FOR THE YEAR

The Company's total return for the year was £908,000 (2019: £3,315,000).

7. RETURN PER ORDINARY SHARE

Total return per Ordinary share is based on the Group total return on ordinary activities after taxation of £908,000 (2019: £3,315,000) and on 71,023,695 (2019: 71,023,695) Ordinary shares, being the weighted average number of Ordinary shares in issue during the year.

Revenue return per Ordinary share is based on the Group revenue profit on ordinary activities after taxation of £1,325,000 (2019: £1,285,000) and on 71,023,695 (2019: 71,023,695) Ordinary shares, being the weighted average number of Ordinary shares in issue during the year.

Capital return per Ordinary share is based on net capital (losses)/gains for the year of £(417,000) (2019: £2,031,000) and on 71,023,695 (2019: 71,023,695) Ordinary shares, being the weighted average number of Ordinary shares in issue during the year.

8. DIVIDENDS ON EQUITY SHARES
Amounts recognised as distributions in the year:
	Year ended	Year ended
	30th June		30th June
	2020	2019
		£'000		£'000
Dividends paid during the year	994	710
Dividends payable in respect of the year ended:
30th June 2020: 1.4p (2019: 1.4p) per share	994	994

It is proposed that a dividend of 1.4p per share will be paid in respect of the current financial year.

9. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

GROUP AND COMPANY

Year ended Year ended 30th June 30th June

2020 2019

£'000 £'000

103,015 93,782

62

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

9. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS continued

ANALYSIS OF INVESTMENT PORTFOLIO - GROUP AND COMPANY

		Quoted	Unquoted		Total
		£'000		£'000		£'000
Opening book cost	60,372	8,448	68,820
Opening investment holding gains/(losses)	26,024	(1,062)	24,962
Opening valuation	86,396	7,386	93,782
Movement in period
Purchases at cost	12,725		-	12,725
Sales
- Proceeds	(3,272)	(8)	(3,280)
- Realised (losses)/gains on sales	(2,094)	8	(2,086)
Movement in investment holding gains for the year	792	1,082	1,874
Closing valuation	94,547	8,468	103,015
Closing book cost	67,731	8,448	76,179
Closing investment holding gains	26,816	20	26,836
Closing valuation	94,547	8,468	103,015
* Quoted investments include unit trust and OEIC funds and one monthly priced fund.
			Year ended	Year ended
			30th June	30th Juned
			2020	2019
				£'000		£'000
ANALYSIS OF CAPITAL GAINS AND LOSSES
Realised (losses)/gains on sales of investments		(2,086)	4,175
Increase/(Decrease) in investment holding gains		1,874	(2,183)
Net (losses)/gains on investments attributable to ordinary
			1,992
shareholders		(212)

Transaction costs

The purchase and sale proceeds figures above include transaction costs on purchases of £2,002 (2019: £3,260) and on sales of £nil (2019: £638).

63

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

10. INVESTMENT IN SUBSIDIARY UNDERTAKING

The Company owns the whole of the issued share capital (£1) of JIT Securities Limited, a company registered in England and Wales.

The financial position of the subsidiary is summarised as follows:

					Year ended	Year ended
					30th June	30th Juned
					2020	2019
							£'000			£'000
	Net assets brought forward				506	506
	Profit for year						-			-
	Net assets carried forward				506	506
11.	OTHER RECEIVABLES
		30th June	30th June			30th June			30th June
		2020	2020	2019	2019
		Group	Company			Group	Company
		£'000		£'000			£'000			£'000
	Prepayments and accrued income	133	133	214	214
	Taxation	4	4	6	6
		137	137	220	220
12. CASH AND CASH EQUIVALENTS
		30th June	30th June			30th June			30th June
		2020	2020	2019	2019
		Group	Company			Group	Company
		£'000		£'000			£'000			£'000
	Cash at bank and on deposit	10,962	10,962	20,605	20,605
13.	OTHER PAYABLES
		30th June	30th June			30th June			30th June
		2020	2020	2019	2019
		Group	Company			Group	Company
		£'000		£'000			£'000			£'000
	Accruals	229	229	636	636
	Amounts owed to subsidiary undertakings	-	506			-	506
		229	735	636	1,142

64

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

14. CALLED UP SHARE CAPITAL
		30th June		30th June
		2020	2019
			£'000		£'000
Authorised
305,000,000 (2019: 305,000,000) Ordinary shares of £0.01 each	3,050	3,050
Issued and fully paid
71,023,695 (2019: 71,023,695) Ordinary shares of £0.01 each	710	710
15. RESERVES
	Share
	Premium		Special		Retained
	account		Reserve		earnings
	£'000		£'000		£'000
GROUP
At 30th June 2019	21,573	56,908	34,780
Increase in investment holding gains	-		-	1,874
Net losses on realisation of investments	-		-	(2,086)
Gains on foreign currency	-		-	414
Performance fee	-		-	(623)
Trail rebates	-		-	4
Retained revenue profit for year	-		-	1,325
Dividend paid	-		-		(994)
At 30th June 2020	21,573	56,908	34,694
	Share
	Premium		Special		Retained
	account		Reserve		earnings
	£'000		£'000		£'000
COMPANY
At 30th June 2019	21,573	56,908	34,780
Increase in investment holding gains	-		-	1,874
Net losses on realisation of investments	-		-	(2,086)
Gains on foreign currency	-		-	414
Performance fee	-		-	(623)
Trail rebates	-		-	4
Retained revenue profit for year	-		-	1,325
Dividend paid	-		-		(994)
At 30th June 2020	21,573	56,908	34,694

65

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

15. RESERVES continued

The components of retained earnings are set out below:

	30th June		30th June
	2020	2019
		£'000		£'000
GROUP
Capital reserve - realised	5,686	7,977
Capital reserve - revaluation	26,836	24,962
Revenue reserve	2,172	1,841
	34,694	34,780
COMPANY
Capital reserve - realised	5,333	7,625
Capital reserve - revaluation	27,343	25,468
Revenue reserve	2,018	1,687
	34,694	34,780

16. NET ASSET VALUE PER ORDINARY SHARE

The net asset value per Ordinary share is calculated on net assets of £113,885,000 (2018: £113,971,000) and 71,023,695 (2098: 71,023,695) Ordinary shares in issue at the year end.

17. ANALYSIS OF CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR

	At 1st July						At 30th
	2019		Cash	Exchange	June 2020
		£'000		flow	movement		£'000
GROUP
Cash at bank and on deposit	20,605	(10,057)	414	10,962
COMPANY
Cash at bank and on deposit	20,605	(10,057)	414	10,962

66

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS

The Group's investment objective is to achieve long-term capital growth. The investment objective is implemented by allocating assets to global investment opportunities through investment in equity, bond, commodity, real estate, currency and other markets. The Group's assets are stated at fair value.

For listed securities, this represents the last traded bid price, or for unit trusts and OEICs, the bid price for dual priced funds, or single price for non-dual priced funds, released by the relevant investment manager.

Unquoted investments are valued by the Directors at the balance sheet date based on recognised valuation methodologies, in accordance with IPEVC valuation guidelines such as dealing prices or third party valuations where available, net asset values and other information as appropriate.

The holding of securities, investing activities and associated financing undertaken pursuant to this objective involve certain inherent risks. Events may occur that would result in either a reduction in the Group's net assets or a reduction of potential revenue profits available for dividend. As an investment trust, the Group invests in securities for the long term. Accordingly it is, and has been throughout the year under review, the Group's policy that no short-term trading in investments or other financial instruments shall be undertaken.

The main financial instrument risks arising from the Group's pursuit of its investment objective are market risk (comprising price risk, currency risk, and interest rate risk), liquidity risk and credit risk. The Board has reviewed and agreed policies for managing each of these risks, which are unchanged from the previous year, and which are summarised below.

Note 18 (h) sets out a summary of the Group's financial assets and liabilities by category.

The only difference between the Group and the Company's financial assets is the Company's investment in subsidiary, which is held at net asset value.

1. Market Risk
   The fair value or future cash flows of a financial instrument held by the Group may fluctuate because of changes in market prices of investments held by the Group.
   This market risk comprises three elements - currency risk (see note 18 (b)), interest rate risk (see note 18 (c)), and other price risk (see note 18 (d)). The Board reviews and agrees policies for managing these risks. The Group's Investment Manager assesses the exposure to market risk when making each investment decision, and monitors the overall level of market risk on the whole of the investment portfolio on an ongoing basis.

67

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Currency Risk
   A proportion of the Group's portfolio is invested in investments denominated in a foreign currency and movements in exchange rates can significantly affect their Sterling value.
   Furthermore, a proportion of the Company's investments in other collective investment schemes may have underlying currency exposure through their investments and, as a result, the Company may be subject to further indirect currency movement.
   Management of the risk
   The Investment Manager does not normally hedge against foreign currency movements affecting the value of the investment portfolio, but takes account of this risk when making investment decisions. In addition, the Directors may authorise the Investment Manager to hedge currency risk or increase it in appropriate circumstances.
   Foreign currency exposure
   During the year under review, the Investment Manager did not enter into any forward currency contracts. (2019: £nil).
   The fair values of the Group's assets that have foreign currency exposure at 30th June 2020 are shown below.

	2020	2020	2020	2020	2019	2019	2019	2019
		US			Japanese				US			Japanese
	Dollars		Euros		Yen		Total	Dollars		Euros		Yen		Total
		£'000		£'000		£'000		£'000		£'000		£'000		£'000		£'000
Investment at fair
value through
profit or loss	1,149	4,076	3,531	8,756	5,193	3,698	3,470	12,361
Cash at bank
and short-term
deposits	10,767		-		-	10,767	15,555		-	66	15,621
Other receivables	1		-		-	1	25		-		-	25
Total net foreign
currency
exposure	11,917	4,076	3,531	19,524	20,773	3,698	3,536	28,007

The above table represents the direct assets denominated/dealt in US Dollars, Japanese Yen and Euros. The Company holds investments which are denominated in sterling which have significant currency exposure. These assets are not included in the above table. The underlying currency exposure will be significantly greater.

68

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Currency Risk continued Foreign currency sensitivity
   During the financial year sterling depreciated by 2.92% against the US dollar (2019: depreciated 3.61%), appreciated by 2.74% against the euro (2019: appreciated 0.03%) and depreciated by 2.78% (2020: depreciated 6.23%) against the Japanese Yen.
   Applying a 10% change in rate to the exposures listed above would affect net assets and total return as follows:

	2020	2020	2020	2020	2019	2019	2019	2019
	US		Japanese		US		Japanese
	Dollars	Euros	Yen	Total	Dollars	Euros	Yen	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
If exchange rates
appreciated by
10%	(1,084)	(371)	(321)	(1,776)	(1,889)	(336)	(315)	(2,540)
If exchange rates
depreciated by
10%	1,325	453	392	2,170	2,309	411	386	3,106

It should be noted that the above illustration is based on the currency denominated/dealt assets noted above at the year end. Exposures may be subject to change during the year as a result of investment decisions.

1. Interest Rate Risk
   The Group will be affected by interest rate changes as it holds cash. The majority of the Group's investments are equity based and are not therefore subject to interest rate risk. However, interest rate changes will have an impact on the valuation of equities, although this forms part of other price risk, which is considered separately below.
   Management of the risk
   The possible effects on fair value and cash flows that could arise as a result of changes in interest rates are taken into account when making investment decisions. The Group currently has no gearing.
   The Group may from time to time hold significant cash balances. Short-term borrowings are used when required. Cash balances are invested in the market and may be put on deposit for up to one year to improve the return.
   Derivative contracts are not used to hedge against the exposure to interest rate risk.

69

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Interest Rate Risk continued Interest rate exposure
   The exposure, at 30th June, of financial assets and liabilities to interest rate risk is shown by reference to:
2. • floating interest rates - when the rate is due to be re-set;
   • fixed interest rates - when the financial instrument is due for repayment.

	2020	2020	2020	2019	2019	2019
				Greater						Greater
	In 1 year		than			In 1 year		than
		or less		1 year		Total		or less		1 year		Total
		£'000		£'000		£'000		£'000		£'000		£'000
Exposure to fixed interest
rates:
Cash in Deposit Accounts	5,569		-	5,569	15,365		-	15,365
Exposure to floating
interest rates:
Cash at bank	5,393		-	5,393	5,240		-	5,240
Total exposure to interest
						20,605		-	20,605
rates	10,962		-	10,962

The above year end amounts may not be representative of the exposure to interest rates during the year, since the level of cash held during the year will be affected by the strategy being followed in response to the Board's and Investment Manager's perception of the market prospects and the investment opportunities available at any particular time.

Interest rate sensitivity

The following table illustrates the sensitivity of the profit before taxation for the year and equity to an increase or decrease of 50 (2019: 50) basis points in interest rates in regard to the Group's monetary financial assets which are subject to interest rate risk.

The sensitivity analysis is based on the Group's monetary financial instruments held at each balance sheet date, with all other variables held constant.

GROUP	Increase		Decrease		Increase		Decrease
	in rate		in rate		in rate		in rate
	2020	2020	2019	2019
	£'000		£'000		£'000		£'000
Effect on total return to equity	55	(55)	103	(103)

70

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Other Price Risk
   The Group's exposure to other price risk comprises mainly movements in the value of its equity related investments.
   A Schedule of the Largest Investments is given on page 10. Investments are valued in accordance with the Group's accounting policies. Uncertainty in future valuations of the Group's investments arises as a result of future changes in the market prices of the Group's listed equity investments and its unit trust and OEIC investments, and the effect changes in exchange rates may have on the sterling value of the investments.
   Management of the risk
   In order to manage this risk the Directors meet regularly with the Investment Manager to compare the performance of the portfolio against the IA sector benchmark and market indices. Given the Group's investment objective, the Group does not hedge against the effect of changes in the underlying prices of the investments.
   The Group had no derivative instruments at the year end.
   The unquoted investments are held at Directors' valuations. All valuations are reviewed by the Investment Manager, the Group's Audit Committee and subsequently recommended to the Board.
   Other price risk exposure
   The Group's exposure to other changes in market prices at 30th June on its quoted investments, which are all equities or equity related, was as follows:

	2020	2019
	£'000		£'000
Fixed assets quoted investments at fair value		86,396
through profit or loss	94,547

The Group's exposure to other changes in prices at 30th June on its unquoted investments was as follows:

	2020	2019
	£'000		£'000
Fixed asset unquoted investments at fair value
through profit or loss	8,468	7,386

71

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Other Price Risk continued Analysed as:

	2020	2019
	£'000		£'000
Equities	7,319	6,270
Loan - non-interest bearing	1,149	1,116
	8,468	7,386

Other price risk sensitivity

The following table illustrates the sensitivity of the profit after taxation for the year and the equity to an increase or decrease of 10% in the fair values of the Group's investments. The sensitivity analysis is based on the Group's investments at each balance sheet date, with all other variables held constant.

	Increase in Decrease in	Increase in		Decrease
	fair value	fair value		fair value		in fair
	2020	2020	2019	2019
		£'000		£'000		£'000		£'000
Effect on total return and on net assets	10,302	(10,302)	9,378	(9,378)

1. Liquidity Risk
   Liquidity risk is the possibility of failure of the Group to realise sufficient assets to meet its financial liabilities, including outstanding commitments associated with financial instruments.
   The Group's assets mainly comprise securities which can be readily sold to meet future funding commitments, if necessary. Unlisted securities, which carry a higher degree of liquidity risk form less than 8% (2019: 7%) of the investment portfolio.
   All financial liabilities of the Group at the balance sheet date are payable within three months.
   Management of the risk
   The liquidity risk is managed by maintaining some cash or cash equivalent holdings in order to meet investment requirements and other liabilities as they fall due. At the year end the Group had liquid resources of £101 million (2019: £103 million).
   This included £11.0 million (2019: £21.0 million) of cash and deposits and £90.5 million
   (2019: £82.7 million) of listed/daily priced investments.

72

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

Liquidity risk exposure

A summary of the Group's financial liabilities is provided in note 18 (h). The Group has sufficient funds to meet these financial liabilities as they fall due.

1. Credit Risk
   Credit risk is the exposure to loss from failure of a counterparty to deliver securities or cash for acquisitions or disposals of investments or to repay deposits.

Management of the risk

Credit risk is managed as follows:

-  investment transactions are carried out with approved brokers, whose credit standard is reviewed periodically by the Investment Manager.

-  cash at bank is held only with an authorised list of banks, periodically reviewed by the Board.

Credit risk exposure

The maximum exposure to credit risk at 30th June 2020 was £10,962 (2019: £20,605), comprising:

	2020	2019
	£'000		£'000
Cash and cash equivalents	10,962	20,605

All of the above financial assets are current, their fair values are considered to be approximately the same as the values shown and the likelihood of a material credit default is considered to be low.

1. Fair Values of Financial Assets and Financial Liabilities
   The Group's financial assets and financial liabilities are stated at their fair values at the year end. The fair value of quoted shares and securities and unit trusts and OEICs is based on last traded market bid prices or the bid/single price provided by the fund administrator. The fair value of unlisted shares and securities is based on Directors' valuations as detailed in the accounting policies (note 1(g)).

73

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

1. Summary of Financial Assets and Financial Liabilities by Category
   The carrying amounts of the Group's financial assets and financial liabilities, as recognised at the balance sheet date of the reporting periods under review, are categorised as follows:

	2020	2019
	£'000		£'000
FINANCIAL ASSETS
Financial assets at fair value through profit or loss
Current assets carried at cost:	103,015	93,782
Debtors (due from brokers, dividends receivable,
accrued income and other debtors)	133	214
Tax recoverable	4	6
Cash and cash equivalents	10,962	20,605
	114,114	114,607
FINANCIAL LIABILITIES
Measured at amortised cost:
Creditors: amounts falling due within one year		636
Accruals	229
	229	636

Fair value of financial instruments

The Company measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements. Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to the fair value measurement of the relevant assets as follows:

•	Level 1 - valued using quoted prices unadjusted in active markets for identical assets
	or liabilities.
•	Level 2 - valued by reference to valuation techniques using observable inputs for the
	asset or liability other than quoted prices included within Level 1.
•	Level 3 - valued by reference to valuation techniques using inputs that are not based
	on observable market data for the asset or liability.

The tables overleaf set out fair value measurements of financial instruments at the year end, by the level in the fair value hierarchy into which the fair value measurement is categorised.

74

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

18. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS continued

(h) Summary of Financial Assets and Financial Liabilities by Category continued

FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS AT 30TH JUNE 2020

	Level 1		Level 2		Level 3	Total
	£'000		£'000		£'000	£'000
Equities and funds	90,472	4,076	8,467		103,015
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS AT 30TH JUNE 2019
	Level 1		Level 2		Level 3	Total
	£'000		£'000		£'000	£'000
Equities and funds	82,698	3,698	7,386		93,782

The valuation techniques used by the Company are explained in the accounting policies on page 57. There have been no transfers during the year between Levels 1, 2 or 3.

The level 2 investment is an offshore fund, traded monthly. All loans are level 3 investments.

A reconciliation of fair value measurements in Level 3 is set out below.

LEVEL 3 FINANICAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS AT 30TH JUNE

	2020	2019
	£'000		£'000
Opening fair value	7,386	5,376
Movement in classification of investments:
Purchases at cost	-	1,116
Sales proceeds	(8)	(250)
Total gains or losses included in gains on investments in the
statement of comprehensive income
- on sold assets	8		-
- on assets held at the end of the year	1,082	1,144
Closing fair value	8,468	7,386

Level 3 valuations comprise the unquoted investments held at Directors' valuation.

The Level 3 unquoted portfolio represents approximately 7.4% of the net asset value of the Group. Fair value has been established using recognised valuation techniques in accordance with IPEVC guidelines. Only two investments each represent more than 0.3% of the Group's net asset value. The largest investment (just over 6% of NAV) is valued based on recent transaction value and the second largest investment on the basis of initial cost. A 10% increase or decrease in its earnings would not have a material impact on the valuation of these investments. Neither of the investments have reached maturity and are not valued on the basis of their earnings.

75

NEW STAR INVESTMENT TRUST PLC

NOTES TO THE ACCOUNTS

for the year ended 30th June 2020

1. Capital Management
   The Group and the Company's capital is as disclosed in their Balance Sheets and is managed on a basis consistent with its investment objective and policies, as disclosed in the Strategic Report on pages 12 and 13. The principal risks and their management are disclosed in the Strategic Report.

19. RELATED PARTIES

Since 1st January 2010 Brompton Asset Management LLP ('Brompton') has acted as Investment Manager to the Company. This relationship is governed by an agreement dated 17th May 2018. Details of the investment management fee payable can be found on page 20.

Mr Duffield is the senior partner of Brompton Asset Management Group LLP, the ultimate parent of Brompton. Mr Duffield owns the majority (59.14%) of the shares in the Company.

Mr Gamble has an immaterial holding in Brompton Asset Management Group LLP.

The total investment management fee payable to Brompton for the year ended 30th June 2020 was £697,000 (2019: £688,000) and at the year-end £177,000 (2019: £177,000) was accrued. A performance fee of £623,000 is payable in respect of the year ended 30th June 2020 (2019: £410,000).

The Group's investments include seven funds managed by Brompton or its associates totalling £19,712,000 (2019: £19,680,000). No investment management fees were payable directly by the Company in respect of these investments.

Details of Directors fees paid may be found on page 34.

20. COMMITMENTS AND CONTINGENCIES

There are no other commitments or contingencies at the reporting date (2019: £nil).

76

NEW STAR INVESTMENT TRUST PLC

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the 2020 Annual General Meeting of New Star Investment Trust plc ("Company") shall be held at Tenth Floor, 1 Knightsbridge Green, London, SW1X 7QAcommencing at 11.00 am on Thursday 12th November 2020 for the following purposes:

ORDINARY BUSINESS

To consider, and if thought fit to pass, the following Resolutions which are proposed as Ordinary Resolutions of the Company:

1. To receive and adopt the Company's Report and Accounts for the year to 30th June 2020 together with the Report of the Auditors therein.
2. To receive and approve the Annual Directors' Remuneration Report for the year to 30th June 2020.
3. To approve the final dividend of 1.4p per Ordinary share in respect of the year to 30th June 2020.
4. To re-elect Mr Geoffrey Howard-Spink, retiring in accordance with the UK Corporate Governance Code, as a Director.
5. To re-elect Mr David Gamble, retiring by rotation, as a Director.
6. To re-elect Mr John Duffield, retiring in accordance with the Listing Rules, as a Director.
7. To re-appoint Ernst & Young LLP as Auditors until the conclusion of the next general meeting at which accounts are laid before members, and authorise the Directors to determine the Auditor's remuneration.

SPECIAL BUSINESS

To consider, and if thought fit to pass, Resolutions 8 to 9 as Ordinary Resolutions of the Company, and Resolutions 10 to 14 as Special Resolutions of the Company:

1. To approve the Directors, Remuneration Policy as set out in the Remuneration Report.
2. That the Directors be generally and unconditionally authorised under section 551 of the Companies Act 2006 ("Act") to exercise all the powers of the Company to allot Ordinary shares in the capital of the Company ("Shares") and/or grant rights to subscribe for or convert any security into Shares up to an aggregate of:
3. 1. £71,023 in nominal value of such Shares; and
   2. a further £71,023 in nominal value of Shares in connection with an offer by way of a rights issue:
   3. 1. to holders of Ordinary shares in proportion (or as nearly may be) to their existing holdings; and
      2. to holders of other equity securities as required by the rights of those equity securities or otherwise as the Directors may consider necessary;

77

NEW STAR INVESTMENT TRUST PLC

NOTICE OF ANNUAL GENERAL MEETING

SPECIAL BUSINESS continued

subject to such exclusions restrictions or other arrangements as the Directors consider necessary or appropriate in relation to fractional entitlements, record dates, treasury shares, or any legal or regulatory or practical problems under the laws of any territory or the requirements of any regulatory body or stock exchange; and unless otherwise renewed varied or revoked the authorities hereby granted shall expire at the earlier of the conclusion of the Annual General Meeting of the Company in 2021 or fifteen months after the passing of this Resolution save that the Company may before such expiry enter into offer(s) or agreement(s) which shall or may require Shares to be allotted after such expiry and the Company may allot Shares in pursuance of such offer(s) or agreement(s) as if the authorities hereby granted had not so expired.

1. That the Articles of Association produced to the meeting and signed by the Chairman of the meeting for the purposes of identification be approved and adopted as the Articles of Association of the Company in substitution for, and to the exclusion of, the existing Articles of Association with effect from the conclusion of the meeting.
2. That subject to the passing of Resolution 9 above the Directors be generally and unconditionally authorised pursuant to section 570 of the Companies Act 2006 ("Act") to allot equity securities (as defined in section 560 of the Act) as if section 561 of the Act did not apply to such allotment, provided that unless otherwise renewed varied or revoked the authority hereby granted shall expire at the earlier of the conclusion of the Annual General Meeting of the Company in 2021 or the date fifteen months after the passing of this Resolution, and shall be limited to:
3. 1. the allotment of equity securities up to an aggregate nominal amount of £35,511 (being approximately 5% of the capital currently in issue); and
   2. the allotment of equity securities at a price (excluding expenses) not less than the net asset value per share for the business day immediately preceding such allotment, or if earlier the agreement to allot;

Save that the Company may enter into offer(s) or agreement(s) which shall or may require Shares to be allotted after such expiry and the Company is authorised to allot Shares in pursuance of such offer(s) or agreement(s) as if the authorities hereby granted had not so expired.

12. That the Company be and is hereby generally and unconditionally authorised in accordance with section 701 of the Companies Act 2006 ("Act") to make market purchases (within the meaning of section 693(4) of the Act) of Ordinary shares in the capital of the Company upon such terms and in such manner as the Directors shall determine provided that:

1. the maximum aggregate number of Ordinary shares authorised hereby to be purchased shall be 10,646,450, being approximately 14.99% of the Ordinary share currently in issue;
2. the minimum price which may be paid per Ordinary share shall be £0.01;

78

NEW STAR INVESTMENT TRUST PLC

NOTICE OF ANNUAL GENERAL MEETING

SPECIAL BUSINESS continued

1. the maximum price (exclusive of expenses) which may be paid per Ordinary share shall be an amount equal to the highest of (a) 5% above the average of the mid-market quotations for Ordinary shares as shown on the London Stock Exchange Daily Official List or website on the five business days immediately preceding the day of purchase and
   (b) in the event of a programme of buybacks the higher of the last independent trade and the highest current independent bid price;

1. 1. at the discretion of the Directors any Ordinary shares bought back under this authority may be cancelled or placed in treasury;
   2. unless otherwise renewed varied or revoked the authority hereby granted shall expire at the earlier of the conclusion of the Annual General Meeting of the Company in 2021 or the date fifteen months after the passing of this Resolution save that the Company may enter into offer(s) or agreement(s) which shall or may require Shares to be bought back after such expiry and the Company may buy back Ordinary shares pursuant to such offer(s) or agreement(s) as if the authority hereby granted had not so expired.
2. That any Ordinary shares held by the Company in treasury, whether as a result of being bought back in accordance with the authority conferred by Resolution 12 above or otherwise may, at the discretion of the Directors, be cancelled or resold or allotted from treasury, provided that they shall not be resold or allotted at a price below the last published net asset value prior to re-issue.
3. That General Meetings of the Company, other than an Annual General Meeting, may be called on not less than 14 clear days' notice.

By order of the Board

Maitland Administration Services Limited Corporate Secretary

30th September 2020

Registered Office: 1 Knightsbridge Green, London SW1X 7QA

Registered in England & Wales No: 3969011

79

NEW STAR INVESTMENT TRUST PLC

NOTICE OF ANNUAL GENERAL MEETING

NOTES TO THE NOTICE OF ANNUAL GENERAL MEETING

1. This Report and Accounts is circulated to holders of Ordinary shares, all of whom are entitled to attend, speak and vote at the above Annual General Meeting ("AGM").
2. Any member entitled to attend and vote at the AGM is also entitled to appoint one or more proxies to attend, speak and vote at the AGM on their behalf, provided that if multiple proxies are appointed they must be appointed in respect of different Ordinary shares. Proxies need not be members of the Company. A form of proxy is sent to members with the Report and Accounts and must be received by the Company's Registrar: Equiniti Registrars, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA duly completed in accordance with the instructions on the form of proxy not less than 48 hours before the time of the meeting, or in the case of an adjourned meeting not less than 48 hours before the time of the adjourned meeting. If multiple proxies are being appointed the form of proxy should be copied and a separate form of proxy completed, identifying the different Ordinary shares each represents, stating that it is in respect of a multiple proxy appointment, for each proxy and have an original signature of the member making the appointment(s). Completion and return of form(s) of proxy will not preclude a member from attending, speaking and voting in person at the AGM.
3. To appoint proxies or give/amend an instruction to an appointed proxy via the CREST system, the CREST message must be received by the issuer's agent, Equiniti Registrars (ID: RA19) by 11.00 am on 10th November 2020. The time of receipt will be taken as the time (as determined by the timestamp applied by the CREST Applications Host) that the issuer's agent is able to retrieve the message. CREST Personal Members or other CREST Sponsored Members, and CREST Members who have appointed voting service providers, should refer to their relevant sponsor or voting service provider for advice on appointing proxies via CREST. Regulation 35 of the Uncertificated Securities Regulations 2001 will apply to all proxy appointments sent via CREST. Members should refer to the CREST Manual (available at www.euroclear.com) for information on CREST system limitations, procedures and timing.
4. A person who is not a member of the Company and receives this notice of meeting as a person nominated by a member to enjoy information rights under Section 146 of the Companies Act 2006 ("Act") does not have a right to appoint proxies. However, if a nominated person has an agreement with the member who nominated them, the nominated person may have a right to be appointed as a proxy or a right to instruct the member as to the exercise of voting rights at the AGM.
5. Shareholders entered on the Register of Members of the Company by 6.30 pm two days before the time for the meeting, or by 6.30pm two days prior to an adjourned meeting, are entitled to attend and vote at the AGM. Any changes to the Register of Members after such time and date shall be disregarded in determining the rights of any shareholders to attend and vote at the AGM.
6. Under Section 319(A) of the Act the Company must cause to be answered any question relating to the business being dealt with at the AGM put by a member attending the AGM unless answering the question would interfere unduly with the preparation for the meeting, would involve the disclosure of confidential information, an answer has already been given on a website, or is undesirable in the interests of the Company or good order of the AGM.
7. Members may not use any electronic address provided in this notice or any related document(s) to communicate with the Company for any purpose other than as specifically stated.
8. As at 12th September 2020, the latest practicable date prior to the publication of this notice, the issued capital carrying voting rights comprised 71,023,695 Ordinary shares. On a poll, each Ordinary share is entitled to one vote, and accordingly at 12th September 2020 the total voting rights attaching to Ordinary shares in issue was 71,023,695.
9. Information regarding the AGM, including the information required by Section 311A of the Act, can be found on the Company's website at www.nsitplc.com

10. No Director has a service agreement with the Company. Directors' letters of appointment will be available for inspection at the AGM venue from 15 minutes before the meeting and until conclusion of the meeting.

11. Members' sufficient shares are entitled, pursuant to Sections 388 and 388A of the Act, to include a Resolution to be dealt with in the business of the AGM and to require the Company to give notice of that Resolution.

80