Dunedin Enterprise Investment Trust PLC

Annual Report & Accounts 2023

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Objective

Contents

01 Financial Highlights

03 Chairman’s Statement

04 Board of Directors

05 The Manager

06 Manager’s Review

08 Investments

11 Long Term Record

12 Strategic Report

12 Section 172

15 Directors’ Report

19 Corporate Governance Report

22 Audit Committee Report

24 Directors’ Remuneration Report

27 Statement of Directors’ Responsibilities

28 Independent Auditor’s Report

33 Financial Statements

52 Notice of Annual General Meeting

56 Information for Investors

57 Glossary of Terms and Definitions and Alternative Performance Measures

58 AIFMD Disclosures

59 Financial Calendar and Corporate Information

Dunedin Enterprise Investment Trust

PLC specialises in the provision of

private equity finance. Private equity is

medium to long term finance provided

in return for an equity stake in

established, potentially high growth,

private companies.

The Company’s investment objective is

to conduct an orderly realisation of its

assets, to be effected in a manner that

seeks to achieve a balance between

maximising the value of the Company’s

investments and progressively

returning cash to shareholders.

References in this report and accounts to ‘Dunedin Enterprise’ or to ‘the Company’ or the ‘Trust’ mean Dunedin Enterprise Investment Trust PLC

References to ‘Dunedin’ or to ‘the Manager’ or to the ‘Investment Manager’ mean Dunedin LLP

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report – Financial Highlights

Financial Highlights

Dividend per ordinary share Discount

Ongoing charges

18.3%

18.8% 2022

10.0p

59.0p 2022

2.1%

1.4% 2022

Returned to shareholders since 2012

£203.5m

£202.1m 2022

Net asset value total return per

ordinary share

Net asset value per

ordinary share

3.6%

21.7% 2022

624.8p

627.1p 2022

Comparative Total Return Peformance

One year to Three years to Five years to Ten years to

December 2023 December 2023 December 2023 December 2023

%%%%

Net asset value per ordinary share 3.6 76.1 90.1 155.9

Share price 6.8 85.1 108.0 207.7

FTSE Small Cap Index (“the Benchmark”) 10.4 19.8 43.3 76.6

FTSE All-Share Index 7.9 30.0 37.1 65.9

Share price total return per

ordinary share

6.8%

18.5% 2022

– Alternative Performance Measures. See page 57 for a glossary of these terms

– in 2011 the investment policy of the Company was changed and distribution policy introduced

Share price

510.5p

509.0p 2022

Year to 31 December 2023 At 31 December 2023

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report – Financial Highlights

Ten year record

Total Shareholder Return (TSR) (Rebased to 100)

2013

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Dunedin Enterprise TSR

350

300

250

200

150

100

FTSE Small Cap exc. Inv Trusts TSR

FTSE All Share exc. Inv Trusts TSR

Total Assets and Cash Returned to Shareholders

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

£m £m £m £m £m £m £m £m £m £m

Analysis of total assets:

Dunedin managed 84.0 93.1 81.5 57.2 64.8 75.9 57.8 43.6 14.1 4.3

European Funds 12.7 16.0 22.0 9.6 10.2 4.4 4.3 5.2 2.8 3.2

Other 0.8 0.4 0.4 1.5 6.1 1.3 1.2 0.3 5.3 0.4

Cash 9.9 0.6 1.1 32.9 5.7 12.3 13.9 24.4 12.4 26.5

Total assets 107.4 110.1 105.0 101.2 86.8 93.9 77.2 73.5 34.6 34.4

Cash returned to shareholders:

Capital returned 5.2 0.7 – 20.6 20.6 5.2 9.8 26.0 41.0 –

Dividends paid 3.6 1.0 3.3 6.4 1.1 0.4 1.0 3.3 6.4 1.4

Return to shareholders 8.8 1.7 3.3 27.0 21.7 5.6 10.8 29.3 47.4 1.4

Cumulative return to shareholders

since 2012 55.3 57.0 60.3 87.3 109.0 114.6 125.4 154.7 202.1 203.5

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report – Chairman’s Statement

Chairman’s Statement

Duncan Budge, Chairman

The total return in the year to 31 December 2023 was

3.6% and 6.8% in terms of net asset value per share and

share price respectively.

Your Company’s net asset value per share decreased

from 627.1p to 624.8p in the year. This is stated after

allowing for dividends per share paid in the year of 25p,

totalling £1.4m.

The share price of 510.5p at 31 December 2023

represented a discount of 18.3% to the net asset value of

624.8p per share.

The net asset value decreased over the year from £34.5m

to £34.4m.

Portfolio

During the year a total of £10.5m was realised from the

investment portfolio.

The realisations of Premier Hytemp, the manufacturer and

supplier of engineered metal products, and Weldex, the

crawler crane hire business, generated proceeds of £5.0m

and £4.6m respectively.

The earn-out from RED, the provider of SAP contract and

permanent staff, generated proceeds of £4.6m.

A sale of the roll-over investment in Hawksford, the

provider of investment related services, generated

proceeds of £0.7m.

Unrealised valuation increases of £1.1m were offset by

decreases of £1.3m. A valuation uplift was achieved at EV,

offset by a reduction in the valuation of FRA. Further

details are provided in the Manager’s Review. The

realisation of all investments in Dunedin Buyout Fund II

means that your Company only has two investments

remaining: Dunedin Buyout Fund III and Realza with only

five underlying portfolio companies.

Cash, Commitments & Liquidity

The original investment periods of all limited partnership

funds to which the Company has made a commitment

have now ended. In future the Company is only required

to meet drawdowns for follow-on investments,

management fees and expenses during the remainder of

the life of the funds.

At 31 December 2023 the Company held cash and near

cash equivalents amounting to £26.5m. There are

outstanding commitments to limited partnership funds of

£7.6m at 31 December 2023, consisting of £6.9m to

Dunedin Buyout Fund III and £0.7m to Realza.

Dividends

An interim dividend of 10.0p was paid in January 2024.

There is no final dividend being proposed.

Outlook/Future of the Company

It may be instructive at this point to look back to 2011,

when a new policy was approved by shareholders to

distribute the proceeds of all realisations. Subsequently in

2016 this was taken a stage further with the Board

recommending and the shareholders approving a policy of

winding down the portfolio in an orderly manner in order

to maximise returns for shareholders. Since 2012 we have

distributed £203.5m to our shareholders, reducing the net

asset value of the company to £34.4m at the end of 2023.

I am pleased that shareholders have benefited over this

period from the Company's performance. The total return

in net asset value per share since 2016 has been 165.1%

and, in terms of share price, 266.3%. This compares with

increases of 59.5% and 60.7% in the FTSE Small Cap

and the FTSE AllShare Indices.

We have always sought to achieve distributions to

shareholders in the most efficient and cost-effective

manner, initially by way of capital distributions to the

extent allowed by our capital reserve. Subsequently, we

have done so by way of tender offers. The most recent

tender offer executed in 2022 distributed £41m to

shareholders.

We are now in a position where we have net assets of

£34.4m, comprising primarily an investment portfolio of

£7.5m and cash (or equivalents) amounting to £26.5m. We

have outstanding commitments to funds in which we are

investors of £7.6m. We are reviewing the optimum way of

returning further value to our shareholders. One of the

options open to us is to place the Company into a

members' voluntary liquidation, as we flagged in

November last year at the time of the sale of our

investment in Premier Hytemp. We recognise that

shareholders value the flexibility of maintaining the

Company's listed status which would be lost once we

enter the liquidation process. Our conclusion is that we

should keep this option closely under review while

seeking to sell as many of our remaining investments as

possible. We have only five underlying portfolio company

investments remaining.

At the forefront of our mind, when deciding whether to

carry out further tenders, is that these are relatively

expensive to execute, particularly for smaller amounts of

capital. Also, in our experience, many individual

shareholders (who constitute either directly or indirectly a

large proportion of our share register) tend not to

participate in tenders. It may also be the case that those

shareholders who hold their shares through ISAs or other

vehicles may encounter problems with continuing to hold

their shares in this way once the Company loses its listed

status following the start of the liquidation process.

The Board continues to work closely with its advisers on

the options available and the optimum timing. We will, of

course, keep shareholders closely informed about our

future plans once these become more certain.

Duncan Budge

Chairman

22 March 2024

Board of Directors

Duncan Budge (68)

Status: Independent Non-Executive Director and Chairman of the Board, Nomination

Committee and Management Engagement Committee

Length of service: Appointed a Director on 2 April 2012 and became Chairman on

14 May 2014

Last re-elected to the Board: 11 May 2022

Experience: Duncan Budge was an Executive Director and Chief Operating Officer of

RIT Capital Partners plc (“RIT”) between 1995 and 2011. He was previously a director of

J. Rothschild Capital Management Limited, a wholly owned subsidiary of RIT. He also

spent six years with Lazard Brothers & Co. Ltd

Committee membership: Audit Committee, Nomination Committee and Management

Engagement Committee

All other public company directorships: Artemis Alpha Trust plc (Chairman), Lowland

Investment Company plc and Biopharma Credit plc

Other directorships: Asset Value Investors Limited

Employment by the Manager: None

Other connections with Company or Manager: None

Shared Directorships with any other Company Directors: None

Shareholding in Company: 7,667 Shares

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Board of Directors

Brian Finlayson (76)

Status: Independent Non-Executive Director

Length of service: Appointed a Director on 1 January 2007

Last re-elected to the Board: 11 May 2022

Experience: Brian Finlayson was appointed to the Board on 1 January 2007 and has

served as an Independent Non-Executive Director for more than nine years. He has over

thirty years of experience in both private equity and corporate finance. He worked with

Dunedin Capital Partners Limited before retiring from the company in 2002. He has held

numerous non-executive director positions in private equity backed businesses both whilst

unlisted and subsequently on listing

Committee membership: Audit Committee, Nomination Committee and Management

Engagement Committee

All other public company directorships: None

Other directorships: None

Employment by the Manager: None

Other connections with Company or Manager: None

Shared Directorships with any other Company Directors: None

Shareholding in Company: 62,249 Shares

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Board of Directors/The Manager

Angela Lane (61)

Status: Independent Non-Executive Director, Chairman of the Audit Committee and Senior

Independent Director

Length of service: Appointed a Director on 1 June 2015

Last re-elected to the Board: 11 May 2022

Experience: Angela Lane has worked as an independent director and adviser to a number

of private companies and private equity firms. Previously Angela spent 18 years working in

private equity at 3i after qualifying as an ACA at PwC. Angela has extensive experience of

business and financial services, healthcare, travel and aviation, media, consumer goods

and infrastructure

Committee membership: Audit Committee, Nomination Committee and Management

Engagement Committee

All other public company directorships: Pacific Horizon Investment Trust PLC (Chair of

Audit), BlackRock Throgmorton Trust plc (Chair of Audit), Seraphim Space Investment Trust

PLC (Chair of Audit)

Other directorships: Roserrow Management Company Limited, The Sherborne School

Employment by the Manager: None

Other connections with Company or Manager: None

Shared Directorships with any other Company Directors: None

Shareholding in Company: 3,000 Shares

The Company is an Alternative Investment Fund (AIF)

under the UK version of the EU’s Alternative

Investment Fund Managers Directive (“AIFMD”). Its

Alternative Investment Fund Manager (“AIFM”) is

Dunedin LLP.

In addition to the Company, Dunedin manages two

limited partnership funds and a European fund of

funds. The Company committed £60m to the £306m

Dunedin Buyout Fund III LP in 2012, representing a

20% interest.

Dunedin is authorised and regulated by the Financial

Conduct Authority.

The Manager

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report – Manager’s Review

The total net assets return for the year, after taking account of dividends and capital returned to shareholders,

was 3.6%.

Following dividend payments totalling £1.4m, the Company’s net asset value decreased from £34.5m to £34.4m

over the year.

£m

Net asset value at 1 January 2023 34.5

Unrealised value increases 1.1

Unrealised value decreases (1.3)

Realised gain over opening valuation 0.7

Net income and capital movements 0.8

Net asset value prior to shareholder distributions 35.8

Dividends paid to shareholders (1.4)

Net asset value at 31 December 2023 34.4

Portfolio Composition

The investment portfolio can be analysed as shown in the table below.

Valuation at Valuation at

1 January Additions Disposals Realised Unrealised 31 December

2023 in year in year movement movement 2023

£’m £’m £’m £’m £’m £’m

Dunedin managed 14.1 0.3 (10.5) 0.7 (0.3) 4.3

Third-party managed (Realza) 2.8 0.3 ––0.1 3.2

Investment portfolio 16.9 0.6 (10.5) 0.7 (0.2) 7.5

AAA rated money market funds 11.6 15.9 (10.3) ––17.2

28.5 16.5 (20.8) 0.7 (0.2) 24.7

in addition the Company held net current assets of £9.7m

Realisations

In the year to 31 December 2023 a total of £10.5m was

realised from the investment portfolio.

In September 2023 Weldex, the crawler crane hire

business, was realised. Proceeds generated from the

sale amounted to £4.6m compared to a valuation of

£6.6m at 31 December 2022.

In November 2023 Premier Hytemp, the manufacturer

and supplier of engineered metal products, was

realised in a secondary sale to Souter Investments.

Proceeds generated from the realisation amounted to

£5.0m, an uplift of £2.1m compared to the valuation at

31 December 2022.

In December 2023 the roll-over investment in

Hawksford, the provider of corporate, private client and

funds services, was realised. The investment was sold

to Star Capital, the majority investor, generating

proceeds of £0.7m compared to a valuation of £nil at

31 December 2022.

In addition, proceeds of £4.6m were received during

the year from the RED earn-out. This compares to an

effective valuation categorised as a debtor at

31 December 2022 of £4.0m.

Valuation movements

In the year to 31 December 2023 valuation uplifts

amounted to £1.1m The majority of this uplift was

generated from EV, the provider of high-performance

video cameras and other visualisation technology used

in the oil and gas industry. The maintainable EBITDA

has increased by 24% in the year. This performance

follows a sustained increase in the oil price.

In addition, there was a release of the provision for

carried interest in Dunedin Buyout Fund III LP

amounting to £0.4m.

Manager’s Review

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report – Manager’s Review

In the year to 31 December 2023 there was a valuation

reduction of £1.3m. The valuation reduction was at

FRA, the forensic accounting, data analytics and e-

discovery business. In line with many professional

service firms trading has not progressed as expected.

With staffing levels maintained to accommodate future

growth, maintainable EBITDA decreased in the year.

Cash and commitments

The Company had outstanding commitments to limited

partnership funds of £7.6m, consisting of £6.9m to

Dunedin Buyout Fund III and £0.7m to Realza, the one

remaining European fund.

The original investment periods of all funds to which

the Company has made a commitment have now

ended. In future the Company is only required to meet

drawdowns for follow-on investments, management

fees and expenses during the remainder of the life of

the funds.

Dunedin LLP

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Investments

FRA

Business description

FRA is an international consultancy that provides forensic accounting, data

analytics and e-discovery expertise, helping businesses respond to

regulatory investigations in an increasingly regulated global environment.

FRA works on some of the largest and most complex regulatory

investigations globally. Its clients are typically blue-chip multinational

corporates seeking advice to help navigate regulatory scrutiny, effect

compliant cross-border data transfer, and manage risk. The company has

offices in London, Dubai, Dallas, New York, Washington DC, Philadelphia,

Paris and Helsinki. It also runs data centres near each office location as

well as in Montreal and Zurich.

Performance

In the year to 31 December 2022, the EBITDA of FRA was £14.9m (2021:

£12.1m) on turnover of £57.4m (2021: £47.9m).

Percentage of

equity held

Cost of Investment

Directors’ valuation

Percentage of Dunedin

Enterprise’s net assets

8.3%

£1.4m

£2.9m

5.2%

Percentage of

equity held

Cost of Investment

Directors’ valuation

Percentage of Dunedin

Enterprise’s net assets

8.9%

9.3%

£4.1m

£3.2m

Realza Capital

Business description

Realza Capital FCR is a Spanish private equity fund making investments in

Spain and Portugal. Dunedin Enterprise’s investment is held via Dunedin

Fund of Funds LP.

The fund invests in companies with leading market positions and attractive

growth prospects either through organic growth or through subsequent

merger & acquisition activity. Realza seeks to invest in companies with an

Enterprise Value normally ranging from €20m to €100m. There are two

remaining investments in a tomato producer and a producer of medicinal

cannabis.

Performance

To date there have been five realisations achieved by the fund generating a

multiple on original cost of 2.0x.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Investments

Business description

EV is a UK headquartered, global market leader in the provision of high

performance, harsh environment, video cameras and quantitative visual

analytics to the global energy industry.

It offers a highly specialist service, providing skilled engineers to

operate its market-leading cameras in the most difficult down-hole

conditions. The high-resolution video images produced by EV’s

cameras allow oil and gas well operators to identify, quantify and solve

problems rapidly. EV has offices in Dubai, Perth, Kuala Lumpur,

Calgary, Aberdeen, Houston and Norwich. It has a further presence in

seventeen worldwide locations across Europe, Canada, USA, South

America, West Africa, the Middle East, Asia and Australasia. The

business employs more than 100 staff.

Performance

In the year to 31 March 2023, the EBITDA of EV was £8.1m (2022:

£5.1m) on turnover of £23.7m (2022: £17.5m).

Percentage of

equity held

Cost of Investment

Directors’ valuation

Percentage of Dunedin

Enterprise’s net assets

9.5%

7.5%

£8.3m

£2.6m

Thredd

Business description

Thredd is a UK headquartered payments processing business providing

customers with leading edge payment processing and ancillary

services. Customers include new emerging fintech or challenger banks,

offering a significantly differentiated proposition for their clients; as well

as specialist payment firms serving the travel, insurance and foreign

exchange markets. It offers a best in class, scalable payment

processing platform with flexibility, innovative features and an

accelerated speed to market for new market entrants. It has over 80

clients, including many UK fintech and challenger banks, and is seeing

significant growth opportunities from emerging overseas challenger

banks as they seek to disrupt their own domestic banking markets.

Performance

In the year to 31 December 2022, the EBITDA of Thredd was -£25.6m

(2021: £3.1m) on turnover of £31.2m (2021: £26.7m).

Percentage of

equity held

Cost of Investment

Directors’ valuation

Percentage of Dunedin

Enterprise’s net assets

1.5%

–

£2.0m

–

Total return of unlisted investments

at 31 December 2023

Original

cost of Realised Directors Total

investment to date*

valuation*

return

Company name £’000 £’000 £’000 £’000

Realza 11,545 14,551 3,208 17,759

FRA 6,035 5,504 2,854 8,358

EV 8,321 – 2,591 2,591

Thredd 8,220 18,203 – 18,203

34,121 38,258 8,653 46,911

– dividends and capital

– excludes carried interest provision of £1.1m

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Investments

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Long Term Record

Per Ordinary Share

Revenue

Group Cash available

Ended returned to for ordinary Net asset

31 December Net assets shareholders shareholders value Earnings Dividend Share price

£’000 £’000 £’000 pppp

2013 116,267 17,992 4,758 529.3 19.9 16.5 436.0

2014 106,556 5,217 980 510.6 4.6 4.7 352.4

2015 104,427 695 (628) 505.8 (3.0) – 321.5

Company*

Ended

31 December

2016 103,901 – 6,916 503.3 33.5 33.5 306.0

2017 100,988 20,644 3,927 489.2 19.0 19.0 396.5

2018 85,235 20,644 177 412.9 0.9 2.0 328.0

2019 91,747 5,161 933 444.4 4.5 5.0 376.0

2020 74,922 9,819 345 413.9 1.7 2.0 336.0

2021 73,413 26,000 4,649 558.8 26.6 30.5 473.0

2022 34,518 41,000 4,499 627.1 36.5 59.0 509.0

2023 34,390 – 169 624.8 3.1 10.0 510.5

from 2016 the financial statements are no longer prepared on a consolidated basis but instead with subsidiaries carried at fair value

This Strategic Report has been prepared in accordance with the

Companies Act 2006 (as amended by the Strategic Report and

Directors’ Report Regulations 2013).

Business and Status

The Company carries on business as an investment trust. In the

opinion of the Directors, the Company has conducted its affairs

during the period under review, and subsequently, so as to meet

the eligibility conditions in section 1158 of the Corporation Tax

Act 2010 and the ongoing requirements for approved companies

in Chapter 3 of Part 2 of the Investment Trust (Approved

Company) (Tax) Regulations 2011 (Statutory Instruments

2011/2999).

The Board has contractually delegated the management of the

investment portfolio to the Manager, Dunedin LLP (“Dunedin”).

A summary of the terms of the Alternative Investment Fund

Management Agreement is contained on page 51.

The existing Investment Objective and Investment Policy of the

Company are detailed below.

Investment Objective and Policy

The Company’s investment objective is to conduct an orderly

realisation of its assets, to be effected in a manner that seeks to

achieve a balance between maximising the value of the

Company’s investments and progressively returning cash to

Shareholders.

The Company’s investment policy is to invest primarily in private

equity investments, either through private equity funds managed

by Dunedin or directly.

The Company may not make any new investments save that: (i)

investment may be made to honour commitments to funds under

existing contractual arrangements; (ii) further investment may be

made into the Company’s direct investments in order to preserve

the value of such investments; and (iii) realised cash may be

invested in liquid cash-equivalent securities, including short-

dated corporate bonds, government bonds, cash funds or bank

cash deposits pending its return to Shareholders in accordance

with the Company’s investment objective.

No more than 10 per cent. of the Company’s total assets may be

invested in any single cash equivalent instrument or placed on

deposit with any single institution, except that this limit does not

apply to investment in government bonds, which shall be

unconstrained.

The use of gearing shall be limited to the investment of up to

£20m of borrowed funds or, if less, 20 per cent. of the

Company’s net asset value (measured at the time of drawdown).

The Company will not invest in other listed closed-end

investment funds.

The Company will continue to comply with the requirements of

UK investment trust legislation and the restrictions imposed on

closed-ended investment funds by the Listing Rules in force from

time to time.

In common with most investment companies, the Company may

borrow to finance further investment. Although the Company is

permitted by its Articles of Association to borrow an amount

equal to the amount paid up on the issued share capital and the

total amounts standing to the credit of the capital and revenue

reserves of the Company, the Board’s policy is that financial

gearing will not exceed 20 per cent. of net asset value.

Section 172

Under section 172 of the Companies Act 2006 (the “CA 2006”),

the Directors have a duty to promote the success of the

Company for the benefit of Shareholders as a whole. In doing so,

the Directors have regard to matters set out in section 172(1) of

the CA 2006 and the likely consequences of any decision in the

long term; the desirability of the Company for maintaining a

reputation for high standards of business conduct; and the need

to act fairly as between members of the Company.

In this context, and taking into consideration that the Company is

an externally managed investment company with no employees,

the Board considers that its primary stakeholders are existing

and potential new shareholders (who are also its customers) and

suppliers which include its externally appointed manager, service

providers and other professional advisers.

Shareholders

To assist the Board in its aim to act fairly between the Company’s

shareholders, it encourages communications with all

shareholders, and the Annual General Meeting provides a key

forum for both the Board and the Manager to make presentations

on the performance of the Company. Please refer to page 21 for

further detail on communication with shareholders.

Service Providers

The Board seeks to engage with the Manager and other service

providers in a collaborative manner. The principal relationship is

with the Manager, whose services are fundamental to the

success of the Company and for achieving the Company’s

investment objective. The terms and conditions of the Manager’s

appointment, including an evaluation of performance and fees,

are reviewed by the Management Engagement Committee

annually and the board regularly reviews the Manager’s financial

reports and performance statistics, further detail of which can be

found on page 20. The Manager seeks to maintain productive

relationships with the Company’s other suppliers on behalf of the

Company, primarily through regular communication and provision

of information as necessary.

Investee Companies

Whilst the Company’s operations are limited (with all substantive

matters being conducted by its externally appointed service

providers) the Board is aware of the need to consider the impact

of the Company’s operations on environmental, social and

governance matters and the Board also expects good standards

at the companies within which the Company is invested. In this

regard, it is satisfied that the Manager consistently and

proactively engages with investee companies on such matters,

where these are material to the investment case and therefore to

the success of the Company. The Corporate Governance report

sets out details of the Manager’s considerations of these issues.

Strategic Report

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report

Investment Policy

Taking into consideration that the Company’s current objective is

to conduct an orderly realisation of the investment portfolio and

return cash to shareholders, the Company’s primary focus in

promoting the success of the Company as a whole is to direct

the Company with a view to realising such objective in a manner

consistent with the stated investment policy.

Risk Management

The Board carries out a regular and robust review of the risk

environment in which the Company operates. The Board

acknowledges that it is responsible for risk management

systems, which have been in place for the year under review, and

for reviewing their effectiveness. There is an ongoing process for

identifying, evaluating and managing the principal and emerging

risks faced by the Company and they are regularly reviewed by

the Board. The principal risks and uncertainties identified by the

Board which might affect the Company’s business model and

future performance, and the steps taken with a view to their

mitigation, are as follows:

Investment and liquidity risk: the Company’s investments are in

small and medium-sized unquoted companies, which by their

nature entail a higher level of risk and lower liquidity than

investments in large quoted companies. Mitigation: the Manager

aims to limit the risk attaching to the portfolio as a whole by

closely monitoring individual holdings, including the appointment

of investor directors to the board of portfolio companies. The

Board reviews the portfolio, including the schedule of projected

exits, with the Manager on a regular basis to evaluate the orderly

realisation process.

No Change in overall risk in year

Portfolio concentration risk: following the adoption of the

Company’s revised investment policy in May 2016, the portfolio

will become more concentrated as investments are realised and

cash is returned to shareholders. This will increase the

proportionate impact of changes in the value of individual

investments on the value of the Company as a whole. The

Directors’ valuation of the Company’s investments represents

their best assessment of the fair value of the investments as at

the valuation date and the amounts eventually realised from such

investments may be more or less than the Directors’ valuation.

Mitigation: the Directors and Manager keep the portfolio under

review and focus closely on those holdings which represent the

largest proportion of total value.

Increase in overall risk in year

Financial risk: most of the Company’s investments involve a

medium to long term commitment and many are relatively illiquid.

Mitigation: the Directors consider it appropriate to finance the

Company’s activities through the retention of sufficient cash

reserves. The Board seeks to ensure that the availability of cash

reserves matches the forecast cash flows of the Company both

on a base and stress case basis given the level of undrawn

commitments to limited partnership funds.

No Change in overall risk in year

Economic risk: events such as economic recession or general

fluctuations in stock markets and interest rates may affect the

valuation of portfolio companies and their ability to access

adequate financial resources, as well as affecting the Company’s

own share price and discount to net asset value. An economic

risk is the conflicts in Ukraine and the Middle East. Mitigation:

the Company invests in a diversified portfolio of investments

spanning various sectors and maintains access to sufficient cash

reserves to be able to provide additional funding to portfolio

companies should this become necessary. The Manager and

board of each portfolio company is keeping under review the

impact of the conflicts in Ukraine and the Middle East and

developing contingency plans/mitigating actions where

appropriate.

Increase in overall risk in year

Credit risk: the Company holds a number of financial

instruments and cash deposits and is dependent on

counterparties discharging their commitment. Mitigation: the

Directors review the creditworthiness of the counterparties to

these investments and cash deposits and seek to ensure there is

no undue concentration of credit risk with any one party.

No Change in overall risk in year

Currency risk: the Company is exposed to currency risk as a

result of investing in companies who transact in foreign

currencies and funds denominated in euros. The sterling value of

these investments can be influenced by movements in foreign

currency exchange rates. Mitigation: Currency risk is monitored

by the Manager on an ongoing basis and on a quarterly basis by

the Board.

No Change in overall risk in year

Internal control risk: the Company’s assets could be at risk in

the absence of an appropriate internal control regime.

Mitigation: the Board regularly reviews the system of internal

controls, both financial and non-financial, operated by the

Company and the Manager. These include controls designed to

ensure that the Company’s assets are safeguarded and that

proper accounting records are maintained.

No Change in overall risk in year

Borrowings

In common with most investment companies, the Company may

borrow to finance further investment. Although the Company is

permitted by its Articles of Association to borrow an amount

equal to the amount paid up on the issued share capital and the

total amounts standing to the credit of the capital and revenue

reserves of the Company, the Board’s policy is that the use of

gearing shall be limited to £20m of borrowed funds or, if less, 20

per cent. of the Company’s net asset value (measured at the time

of drawdown). The Board has no intention for the Company to

use gearing.

Review of Performance

An outline of the performance, market background, investment

activity and portfolio during the year under review and the

performance over the past 10 years, as well as the investment

outlook, are provided in the Chairman’s Statement on page 3 and

the Manager’s Review on pages 6 to 7. Details of the Company’s

investments can be found on pages 8 to 10.

Monitoring Performance – Key Performance Indicators

At each Board meeting the Directors consider a number of

performance indicators to assess the Company’s success in

achieving its objectives, which include both absolute and relative

performance compared to the market indices and peer group.



Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Strategic Report

The key performance indicators (“KPIs”) used to measure the

progress and performance of the Company are as follows:

• cash distributions to shareholders;

• movement in share price;

• movement in net asset value per ordinary share;

• movement of net asset value and share price performance

compared to the Benchmark; and

• ongoing charges.

Details of the KPIs are shown on pages 6 to 7. Alternative

performance measures are defined on page 57.

Share Buyback

The Board recognises that it is in the long-term interests of

shareholders to reduce discount volatility and believes that the

prime driver of discounts over the longer term is performance. As

outlined on page 18, the Board intends to seek renewal of its

annual share buyback authority. The Board does not intend to set

a precise discount target at which shares might be bought back

as it believes that the announcement of specific targets would be

likely to hinder the successful execution of a buyback policy.

Social, Community, Human Rights, Employee

Responsibilities and Environmental Policy

Whilst the Company has no employees and therefore no

requirement to report separately on this area (as the

management of the portfolio has been delegated to Dunedin), the

Company has regard to each of the factors set out in section 172

of the Companies Act 2006 and is mindful of the diversity targets

under the Listing Rules and other reporting obligations (to the

extent applicable to an investment trust) in respect of

environmental, social and governance matters. Further, Dunedin,

with the support of the Board, takes environmental, social and

governance factors and human rights issues into consideration

when making investment decisions made on behalf of the

Company. The Manager’s environmental, social and governance

policy can be found at www.dunedin.com. The Manager also

supports the principles of the UK Stewardship Code and

implements these where applicable. Details of the Alternative

Investment Fund Management Agreement are provided on

page 51.

Diversity

At 31 December 2023, there were two male directors and one

female director on the Board. The Board’s policy on diversity is

set out on page 20 and the Company is mindful of the diversity

targets set out under the Listing Rules.

In accordance with Listing Rule 9.8.6R(9), the Board is required

to disclose on a 'comply or explain' basis whether it has met the

following targets: (i) at least 40 per cent. of the Board should be

women; (ii) at least one of the senior board positions should be

held by a woman; and (iii) at least one member of the Board

should be from a minority ethnic background. The Company's

Board, which is comprised of three independent non-executive

directors, is relatively small and, in the light of the long-term

nature of the Company’s investments, the Board considers it to

be beneficial for Directors of the Company not to be subject to

any overall limit on tenure. The Company is also in a managed

wind-down process and the Board considers consistency of

leadership as the Company realises its remaining investments to

be valuable. As a result of these factors, the Company does not

currently comply with all of the diversity targets under the Listing

Rules, as less than 40 per cent. of the Board members are

women and none of the Directors are from a minority ethnic

background. However, the Company does meet the second

target, noting that the position of Senior Independent Director is

held by a woman.

Board Gender as at 31 December 2023

Number of

senior

Number of positions on

board Percentage of the board

members the board (SID and Chair)

Men 2 66.67 1

Women 1 33.33 1

Board Ethnic Background as at 31 December 2023

Number of

senior

Number of positions on

board Percentage of the board

members the board (SID and Chair)

White British or

other White

(including minority-

white groups) 3 100.00 2

The Company has opted not to disclose against the number of

Directors in executive management as this is not applicable as

the Company is an externally managed investment company with

no executive directors and does not have either a chief executive

officer or a chief financial officer.

By order of the Board

Duncan Budge

Chairman

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Report

The Directors present their report and audited financial

statements for the year to 31 December 2023.

The Manager of the Company is Dunedin LLP (“Dunedin”). The

Board is independent of Dunedin. The Company’s registration

number is SC052844.

Going Concern

The financial statements have not been prepared on a going

concern basis since the Company’s current objective is to

conduct an orderly realisation of the investment portfolio and

return cash to shareholders. No adjustments were necessary to

the investment valuations or the recognition and measurement of

other assets and liabilities included in the financial statements as

a consequence of the basis of preparation.

Statement on long-term viability

In accordance with the AIC Code of Corporate Governance, the

Directors have assessed the prospects of the Company over the

three-year period to 31 December 2026. The Directors consider

that for the purpose of their assessment it is not practical or

meaningful to look forward over a period of more than three

years. Furthermore, the Directors deem that this reflects a

balance between assessing the Company’s prospects over the

longer term and the uncertainties inherent in looking out further

than three years.

The Board has taken account of the Company’s current position

and carried out a robust assessment of the principal risks and

uncertainties facing the Company and the mitigating actions as

identified in the Strategic Report. The Board also considered the

major factors which effect the economic, regulatory and political

environment.

The assessment also considered:-

• the nature of the Company’s business, including cash

reserves available to the Company;

• the potential for its unlisted portfolio to generate future

income and capital proceeds;

• future capital calls by funds to which the Company has made

commitments;

• the Company’s income and expenditure projections; and

• the change to the Company’s investment objective and the

impact on the potential of the unlisted portfolio to generate

future income and capital proceeds during the managed

wind-down and the ability of the Directors to minimise the

level of cash outflows should this be necessary.

These metrics are subject to sensitivity analysis which involves

flexing a number of the main assumptions underlying the

forecasts. The principal factors which were stress tested were

the:-

• timing of realisations (delayed by one year); and

• quantum of realisations (reduced by 20%).

The Board has concluded that there is a reasonable expectation

that the Company will be able to continue in operation and meet

its liabilities as they fall due over the three-year period to 31

December 2026. If the remaining investments in the portfolio are

either wholly or substantially realised within three years then

formal proposals may be put to Shareholders for a members’

voluntary liquidation prior to 31 December 2026.

Share Capital

At 31 December 2023, the Company’s issued and paid up share

capital was £1,376,068 divided into 5,504,274 fully paid up

ordinary shares of 25 pence each.

The rights attaching to the Company’s shares are set out in the

Company’s Articles of Association (which may be amended by

special resolution) and they are also supplemented by (and are

subject to) relevant provisions of the Companies Act 2006

(“2006 Act”) and other legislation applying to the Company from

time to time.

Capital Entitlement

On a winding-up, after meeting the liabilities of the Company, the

surplus assets will be paid to ordinary shareholders in proportion

to their shareholdings.

Dividends

The ordinary shares carry a right to receive dividends which are

declared from time to time by an ordinary resolution of the

Company (up to the amount recommended by the Directors) and

to receive any interim or special dividends which the Directors

may resolve to pay.

An interim dividend of 10.0p per share was paid to shareholders

on 19 January 2024.

Voting Rights

Each ordinary shareholder present in person or by proxy is

entitled to one vote on a show of hands and, on a poll, to one

vote for every share held.

Rights attaching to B shares

Following the approval by shareholders on 8 May 2019, the

Directors have the ability to capitalise sums standing to the credit

of certain of the Company’s reserves in accordance with the

Articles of Association and use such capitalised amounts to allot

and issue as fully paid up B shares of 1 pence each. The

quantum and timing of any issue is at the discretion of the

Directors.

Any B shares issued will be redeemable at the option of the

Company and it is expected that any redemption will occur

shortly after each date of issue of B shares, when all of the

B shares then in issue will be compulsorily redeemed and

cancelled in accordance with their terms for an amount not

exceeding the amount treated as paid up on the B shares.

When in issue, B shares do not provide the holder with any

voting rights. B shares carry a limited right to a dividend;

however, due to the very short time B shares will be in existence

if issued, no dividend is ever likely to become payable. On a

return of capital on a winding up, the holders of any B shares in

issue will be entitled to 1 pence per B share held by them, in

priority to any payment to the holders of every other class of

shares in the Company.

Directors’ Report

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Report

As the Company now has insufficient capital reserves available

to issue B shares for new consideration it is not envisaged that

the Company will issue any further B shares.

Significant Shareholdings

At 31 December 2023 the Company had received notification of

the following holdings of voting rights (under the FCA’s

Disclosure and Transparency Rules):

Ordinary % of issued

shares share capital

Interactive Investor 2,013,138 36.6

Hargreaves Lansdown 800,400 14.5

Asset Value Investors 329,454 6.0

Halifax Share Dealing 226,370 4.1

Lind Invest 213,325 3.9

AJ Bell Securities 173,997 3.2

Directors

Details of the current Directors of the Company are shown on

pages 4 to 5. All Directors are considered to be independent. No

contract or arrangement existed during the period in which any

of the Directors had a material interest. No Director has a service

contract with the Company. Following a detailed review by the

Board of each of the Directors other commitments, both public

and private, it is considered that each has sufficient time

available to undertake their duties as a Director of the Company.

In accordance with the UK Corporate Governance Code,

changes to the Chairman’s other significant commitments require

to be disclosed and explained. The Chairman’s other

directorships are noted on page 4. The Directors have carefully

considered the Chairman’s other directorships and consider that

the Chairman effectively manages his commitments and has

sufficient time to meet what is expected of him as Chairman of

the Company. The Chairman’s attendance at Board and

Committee meetings is outlined in the relevant table on page 20.

The table shows that the Chairman has attended each Board and

Committee meeting held during the year. The Directors believe

this demonstrates that the Chairman continues to allocate

sufficient time to the Company and continues to discharge his

responsibilities effectively.

Angela Lane, Duncan Budge and Brian Finlayson will retire from

the Board and, being eligible, offer themselves for re-election at

the Annual General Meeting (“AGM”).

Duncan Budge is a non-executive director of Asset Value

Investors. Clients of Asset Value Investors are significant

shareholders in the Company. Duncan Budge has no role in the

investment decisions of Asset Value Investors. The Directors do

not consider that there are relationships or circumstances which

are likely to affect Duncan Budge’s judgement.

Brian Finlayson was appointed to the Board on 1 January 2007

and has served for more than nine years. He has over thirty years

of experience in both private equity and corporate finance. He

worked with Dunedin Capital Partners Limited before retiring

from the company in 2002. He has held numerous non-executive

director positions in private equity backed businesses both whilst

unlisted and subsequently on listing. The Directors have carefully

considered Brian Finlayson’s independence and believe that

notwithstanding his historic connections with the Manager’s

group and the number of years he has served as a Director, he

retains independence of character and of judgement. The

Directors do not consider that there are relationships or

circumstances which are likely to affect Brian Finlayson’s

judgement. Given the long-term nature of private equity

investments the Board considers it a significant benefit to the

Company for Directors of the Company not to be subject to any

overall limit on tenures.

Following performance evaluation, in the view of the other

Directors, Angela Lane, Duncan Budge and Brian Finlayson

continue to perform effectively and to demonstrate commitment

to the Company. The re-election of Angela Lane, Duncan Budge

and Brian Finlayson is recommended to shareholders as their

skills and experience continue to add to the strength of the

Board.

Tenure of the Chairman

Duncan Budge has been a Director of the Company since 2 April

2012 and Chairman since 14 May 2014. The Nomination

Committee has resolved that it is in the best interests of the

Company that there should be no limit on the length of tenure of

the Chairman; however, this position will be subject to annual

review. The Nomination Committee took a number of factors into

consideration when arriving at this conclusion, including the fact

that private equity investments by their nature are long term

investments where an accumulated knowledge of the

investments is beneficial to their supervision. Additionally, the

Company is in a wind-down process which was approved by

shareholders in May 2016. At the time the wind-down was

approved, the Directors indicated that the process would take at

least seven years to complete and the Nomination Committee

consider it beneficial for there to be consistency of chairmanship

during this period.

Directors’ and Officers’ Liability Insurance/Directors’

Indemnity

The Company maintains insurance in respect of directors’

liabilities in relation to their acts on behalf of the Company.

In line with market practice and the Company’s Articles of

Association, the Company has agreed to indemnify the Directors

in respect of costs, charges, liabilities, damages and expenses,

arising out of any claims or proposed claims made for

negligence, default, breach of duty, breach of trust or otherwise,

or relating to any application under section 1157 of the 2006 Act,

in connection with the performance of their duties as Directors of

the Company. The indemnities would also provide financial

support from the Company should the level of cover provided by

the Directors’ & Officers’ insurance maintained by the Company

be exhausted.

Directors’ Conflicts of Interest

Under the 2006 Act, a Director must avoid a situation where he

has, or can have, a direct or indirect interest that conflicts, or

possibly may conflict, with the Company’s interests. The 2006

Act allows directors of public companies to authorise conflicts

and potential conflicts, where appropriate, where the articles of

association contain provisions to this effect. The Company’s

Articles of Association give the Directors authority to approve

such situations.

The Company maintains a register of Directors’ conflicts of

interest which have been disclosed and approved by the other

Directors. The register is reviewed at each Board meeting and

the Directors are required to disclose to the Company Secretary

any change to conflicts or any potential new conflicts. Where a

conflict of interest arises, the Director concerned will not

participate in any discussions or decisions in that area.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Report

Corporate Governance

The statement on Corporate Governance on pages 19 to 21 is

included in the Directors’ Report by reference.

Investment Management Arrangements

The principal terms of the Company’s Alternative Investment

Fund Management Agreement with Dunedin are set out on

page 51.

The Management Engagement Committee has reviewed

Dunedin’s investment policy and process. The review covered

the performance of the Investment Manager, its management

process, investment style, resources and risk controls. The

Management Engagement Committee is satisfied with the results

of the review and is therefore of the opinion that the continuing

appointment of Dunedin on the terms agreed is in the interests of

shareholders as a whole. Such a review is carried out on an

annual basis.

Dunedin Managed Funds and Dunedin Fund of Funds LP operate

carried interest schemes. Dunedin executives participate in these

carried interest schemes.

Use of financial instruments

Reference is made to note 18 on pages 48 to 50 which sets out a

description of the financial instruments and associated risks.

Secretary

Dunedin LLP is appointed as Company Secretary pursuant to the

Alternative Investment Fund Management Agreement, details of

which are set out on page 51.

Duration

The Company does not have a fixed life. Reference is made to

the Going Concern statement as detailed on page 15.

Bribery Act

The Company has a zero-tolerance policy towards bribery and is

committed to carrying out business fairly, honestly and openly.

The Investment Manager also adopts a zero-tolerance approach

and has policies and procedures in place to prevent and detect

bribery.

Facilitation of tax evasion

The Company has a zero-tolerance policy towards the facilitation

of tax evasion. The Investment Manager also adopts a zero-

tolerance approach and has policies and procedures in place to

prevent and detect the facilitation of tax evasion.

Engagement with Suppliers and Customers

Reference is made to the section 172 statement on pages 12

and 13.

Social, Community and Environmental Policy

The statement on social, community, environmental and human

rights policy on page 14 is included in the Strategic Report by

reference.

Modern Slavery Act

The Company is an investment company and has no employees.

The Directors are satisfied that, to the best of their knowledge,

the Company’s principal suppliers, which are listed on the inside

back cover of this report, comply with the provisions of the UK

Modern Slavery Act 2015.

Activities in the field of research and development

The Company does not undertake activities in the field of

research and development.

Greenhouse Gas Emissions

All of the Company’s activities are outsourced to third parties.

As such it does not have any physical assets, property,

employees or operations of its own and does not generate any

greenhouse gas or other emissions producing sources under the

Companies Act 2006 (as amended by the Strategic Report and

Directors’ Report Regulations 2013).

External Auditor

The Directors confirm that so far as each Director is aware there

is no relevant audit information of which the Company’s external

auditor is unaware. Each Director has also taken all reasonable

steps that he or she ought to have taken as a Director to make

himself or herself aware of any relevant audit information and to

establish that the external auditors are aware of that information.

The External Auditor, Johnston Carmichael LLP, has indicated its

willingness to continue in office and a resolution re-appointing

them and authorising the Directors to fix their remuneration will

be proposed as resolutions 6 and 7 at the forthcoming Annual

General Meeting.

Post Balance Sheet Events

The Manager’s Review on pages 6 to 7 details all post balance

sheet events.

Annual General Meeting (“AGM”)

The AGM of the Company will be held at the offices of Dickson

Minto WS, 16 Charlotte Square, Edinburgh, EH2 4DF on 15 May

2024 at 12 noon. Notice of the AGM is given on pages 52 to 55

of this report.

In addition to completing the enclosed Form of Proxy and

returning it to Equiniti as per the instructions on the form,

shareholders can submit proxies online by logging onto

www.sharevote.co.uk. To use this service shareholders will need

their Voting ID, Task ID and Shareholder Reference Number

printed on the Form of Proxy. Full details of the procedure are

given on the website. Alternatively, shareholders who have

already registered with Equiniti’s online portfolio service,

Shareview, can appoint a proxy by logging on to their portfolio at

www.shareview.co.uk using their usual user ID and password.

Once logged in simply click “view” on the “My Investments”

page, click on the link to vote, then follow the on-screen

instructions. Any such votes need to be cast by no later than

12 noon on 13 May 2024.

The Board would also welcome questions from shareholders in

advance of the AGM. Please submit all questions to

info@dunedinenterprise.com by 13 May 2024. The Board will

provide answers to these questions after the AGM.

If it is necessary to provide you with further information about the

Annual General Meeting, or notify you about any alternative

arrangements, we will do so on our website

(www.dunedinenterprise.com) and by RNS.

Resolutions to be considered at the AGM

Resolutions 1 to 7 will be proposed as ordinary resolutions. This

means that for each of those resolutions to be passed, more than

half of the votes cast must be in favour of the resolution.

Resolutions 8 to 9 will be proposed as special resolutions. This

means that for each of those resolutions to be passed, at least

three-quarters of the votes cast must be in favour of the

resolution. Each of these resolutions is being proposed to

comply with the Company’s Articles of Association and to obtain

certain authorities required under the 2006 Act from

shareholders.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Report

Resolution 1: Receive the audited Report and Accounts

Shareholders are being asked to receive the audited accounts for

the year ended 31 December 2023.

Resolution 2: Approve the Directors’ Remuneration Report

Shareholders are being asked to approve the Directors’

Remuneration Report set out pages 24 to 26 for the year ended

31 December 2023.

Resolutions 3, 4, and 5: Re-election of Directors

The Directors standing for re-election and their biographical

details are set out on pages 4 to 5. The Board recommends to

Shareholders the re-election of the Directors, each of whom the

Board regards as possessing the requisite skills and attributes to

continue making significant contributions in their respective

roles.

Resolutions 6 and 7: Re-appointment and remuneration of

external auditor

The Company is required to appoint auditors at each general

meeting at which accounts are presented to shareholders. It is

proposed that Johnston Carmichael LLP be and are hereby re-

appointed as auditor of the Company and will hold office from

the conclusion of the AGM until the conclusion of the next

general meeting at which accounts are laid before the Company,

and that their remuneration be fixed by the Directors.

Resolution 8: Share buy-backs

The existing buy-back authority, granted at the AGM of the

Company held on 10 May 2023, permits the Company to make

market purchases of up to 14.99 per cent. of the Company’s

issued ordinary share capital as at 31 March 2023 and expires at

the forthcoming AGM. Resolution 8 seeks to renew the buy-back

authority. The authority, under Resolution 8, if conferred, will only

be exercised if, in the Directors’ opinion, a repurchase would be

in the best interests of shareholders as a whole and would result

in an increase in the net asset value per Ordinary Share for the

remaining shareholders.

The Directors propose to renew the authority at this year’s AGM

and seek authority to purchase up to 825,090 Ordinary Shares

(being 14.99 per cent. of the issued share capital as at 28 March

2024 the latest practicable date prior to publication of this

notice). This authority will expire at the conclusion of the AGM of

the Company in 2025 (or, if earlier, the date following 15 months

from this year’s AGM). Purchases of Ordinary Shares will only be

made through the market for cash at prices below the prevailing

net asset value per Ordinary Share. Under the Listing Rules of

the Financial Conduct Authority, the maximum price (excluding

expenses) that can be paid is not more than the higher of (i) 5 per

cent. above the average market values of the ordinary shares for

the five business days before the day on which the purchase is

made; (ii) the price of the last independent trade on the trading

venue where the purchase is carried out; and (iii) the highest

current independent purchase bid on that venue. The minimum

price that may be paid will be 25 pence per share (being the

nominal value of a share). Ordinary shares that are purchased will

be cancelled. The effect of any cancellation would be to reduce

the number of shares in issue. In making purchases, the

Company will deal only with member firms of the London

Stock Exchange.

Resolution 9: Notice of General Meetings

The Shareholder Rights Directive (“Directive”) was implemented

in the UK in August 2009. One of the requirements of the

Directive is that all general meetings must be held on 21 days’

notice unless shareholders agree to a shorter notice period.

Resolution 9 seeks to renew this shareholder approval. The

approval will be effective until the Company’s next AGM, when it

is intended that a similar resolution will be proposed. The

Company will also need to meet the requirements for electronic

voting under the Directive before it can call a general meeting on

14 days’ notice. The Directors only intend to call a general

meeting on less than 21 days’ notice where the proposals are

time sensitive and the short notice would clearly be an

advantage to shareholders as a whole.

Recommendation of the Board

The Board considers that all the resolutions to be considered at

the AGM are in the best interests of the Company and the

shareholders as a whole. Your Board intends to use reasonable

endeavours to vote in favour of them in respect of their entire

beneficial holdings of Ordinary Shares which amount, in

aggregate, to 72,916 Ordinary Shares (representing

approximately 1.32 per cent. of the ordinary share capital of the

Company in issue) and unanimously recommends that you do so

as well.

By order of the Board,

Duncan Budge

Chairman

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Corporate Governance Report

Compliance

The Board considers that the Company has complied with the

relevant principles and provisions contained in the UK Corporate

Governance Code (“UK Code”) issued by the Financial Reporting

Council (“FRC”) in July 2018 and the principles and provisions

contained in the AIC’s Code of Corporate Governance issued in

February 2019 (the “AIC Code”) throughout this accounting

period with the exception of the matters noted below.

The AIC Code can be found on the AIC website

(www.theaic.co.uk). It includes an explanation of how the AIC

Code adapts the Principles and Provisions set out in the UK

Code to make them relevant for investment companies. A copy

of the UK Corporate Governance Code can be found at

www.frc.org.uk.

The UK Corporate Governance Code includes provisions relating

to the role of the Chief Executive, Executive Directors’

remuneration and the need for an internal audit function. For the

reasons set out in the AIC Code, and as explained in the UK

Corporate Governance Code, the Board considers that these

provisions are not relevant to the position of the Company, which

is an externally managed investment company. The Company

has not, therefore, reported further in respect of these provisions.

The Company has no greenhouse gas emissions to report from

the operations of the Company, nor does it have responsibility

for any other emissions producing sources under the

Companies Act 2006 (as amended by the Large and Medium

Sized Companies and Groups (Accounts and Reports)

Regulations 2008 and the Strategic Report and Directors’

Report Regulations 2013).

The Board

The Board consists of three non-executive Directors, all of whom

the Company deems to be independent, even though Duncan

Budge and Brian Finlayson have both served as a Directors for

over nine years.

On appointment, new Directors are provided with an induction

programme which is tailored to the particular circumstances of

the appointee. Following appointment, the Chairman regularly

reviews and agrees with Directors, as appropriate, their training

and development needs as necessary to enable them to

discharge their duties taking account of company specific

matters and industry issues.

The Board determines the strategic direction of the Company. It

meets at least four times a year and there is regular contact with

the Manager between these meetings. There is a formal schedule

of matters specifically reserved for Board decisions. The

schedule of matters is reviewed regularly by the Board. The

Directors also have access to any information, the advice and

services of the Company Secretary and, if required, external

advice at the expense of the Company. The Company Secretary

is also responsible for ensuring good information flows between

all parties. The Board maintains ongoing dialogue with the

Company’s legal adviser in relation to corporate governance

matters.

There is a clear division of responsibility between the Board and

the Manager. The Manager’s role is defined within the Alternative

Investment Fund Management Agreement. The Board and the

Manager have agreed clearly defined investment criteria and

specific levels of authority. Reports on these issues, including

performance statistics, investment valuations and management

accounts, are submitted to the Board at each meeting. The

Manager’s evaluation procedure and financial analysis of the

companies within the portfolio includes detailed research and

appraisal, and also takes into account environmental policies and

social, ethical, human rights and other business issues.

The Manager’s environmental, social and governance policy can

be found at www.dunedin.com. The Manager also supports the

principles of the UK Stewardship Code and implements these

where applicable. As an institutional investor, the Company

recognises its responsibility that the companies in which it

invests should aspire to appropriate levels of corporate

governance. As a matter of policy, the Company aims to ensure

the Manager utilises its votes in respect of shares held in the

relevant underlying portfolio companies at the annual general

meetings of these companies. In the year to 31 December 2023

the Manager voted in favour of all resolutions put forward at the

annual general meetings of portfolio companies.

The Manager does not exclude companies from their investment

universe purely on the grounds of ESG factors but adopt a

positive engagement approach whereby matters are discussed

with management with the aim of improving the relevant policies

and management systems and enabling the Manager to consider

how ESG factors could impact long term investment returns.

The Company’s Articles of Association require that all Directors

are subject to retirement by rotation and, given this and that all of

the Directors are non-executive directors, the Board does not

consider it necessary for the Directors to be appointed for a fixed

term. The Board’s policy on tenure is to adopt best practice in

line with the requirement of the AIC Code, for all Directors to

retire and, if appropriate, stand for annual re-election at each

AGM. The Board does not feel that it would be appropriate to

adopt a policy whereby Directors serve for a limited period as the

historical knowledge of the portfolio is a key benefit. Any

Directors appointed to the Board since the previous AGM also

retire and stand for election.

During the year the performance of the Board, committees and

individual Directors was evaluated through a discussion process

led by the Chairman. The performance of the Chairman was

evaluated by the other Directors. Amongst other considerations,

the performance evaluation considered the balance of skills and

diversity of the Board, as well as the Board’s overall

effectiveness. The Board believes it has an appropriate balance

of skills and experience, length of service and knowledge of the

Company. Each individual Director’s training requirements are

reviewed as part of the annual evaluation process. The Board

does not consider that the use of external consultants to conduct

this evaluation is likely to provide any meaningful advantage over

the process adopted, however, the option of using of an external

consultant is kept under review.

Corporate Governance Report

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Corporate Governance Report

The Board supports diversity in the boardroom, including targets

set out under the Listing Rules, and is of the opinion that

appointments to the Board should be made considering a

number of different diversity criteria (including gender, ethnicity,

sexual orientation, disability or educational, professional and

socio-economic backgrounds) alongside the appropriate skill set,

experience and expertise.

The table below details the number of Board, Audit, Nomination

and Management Engagement Committee meetings attended by

each Director. During the year there were four Board meetings,

four Audit Committee meetings, two Nomination Committee

meetings and two Management Engagement Committee

meetings.

Management

Audit Nomination Engagement

Board Committee Committee Committee

meetings meetings meetings meetings

Directors attended attended attended attended

Duncan Budge 442 2

Brian Finlayson 4422

Angela Lane 4422

Board Committees

There are three committees of the Board: the Nomination

Committee, the Management Engagement Committee and the

Audit Committee. The terms of reference for each committee are

available on the Company’s website. A report of the activity of

each committee is set out below.

Due to the size of the Board, the Board has not established a

separate Remuneration Committee and, as a whole, fulfils the

function of the remuneration committee.

Nomination Committee

Members:

Duncan Budge (Chairman)

Brian Finlayson

Angela Lane

Due to the size of the Board, the Nomination Committee

comprises all the independent non-executive directors. The

Nomination Committee is responsible for identifying and

nominating to the Board new Directors and for considering

whether existing Directors should be re-elected. The Nomination

Committee is also responsible for monitoring the composition,

size and structure of the overall Board. The Nomination

Committee aims to maintain an appropriate balance of skills and

experience within the Board and, together with the Board,

supports the principle of diversity in the boardroom. The Board

is conscious of the diversity targets set out in the Listing Rules

and the Board complies with the AIC Code in appointing

appropriately diverse, independent non-executive Directors who

set the operational and moral standards of the Company. The

Board will always appoint the best person for the role and will

not discriminate on the grounds of gender, ethnicity, sexual

orientation, disability or educational, professional or socio-

economic backgrounds. The Nomination Committee is

responsible for ensuring that any recruitment process takes

account of the Company’s diversity policy. From time to time,

the Nomination Committee uses external specialist search

consultants, as appropriate, to assist it in carrying out

its responsibilities.

The Nomination Committee is chaired by Duncan Budge, except

when this committee considers his succession and reviews his

performance. In such circumstances, the Nomination Committee

elects an alternative member to take the Chair. The Nomination

Committee met twice in the year.

Management Engagement Committee

Members:

Duncan Budge (Chairman)

Brian Finlayson

Angela Lane

Due to the size of the Board, the Management Engagement

Committee comprises all the independent non-executive

Directors. The Management Engagement Committee reviews the

performance of the Manager and its compliance with the terms

of the Alternative Investment Fund Management Agreement. The

terms and conditions of the Manager’s appointment, including an

evaluation of performance and fees, are reviewed by the

Management Engagement Committee on an annual basis.

Audit Committee

Members:

Angela Lane (Chairman)

Duncan Budge

Brian Finlayson

The Audit Committee comprises all the independent non-

executive Directors. The Directors believe that it is in the best

interests of the Company that its Chairman, Duncan Budge, is a

member of the Committee. The Board is satisfied that the Audit

Committee has the necessary skills and experience to operate

effectively. The Audit Committee Report is set out on pages 22

to 23.

Internal Controls

The Directors have overall responsibility for ensuring that there

are systems of internal control in place, both financial and non-

financial, and for reviewing their effectiveness. The purpose of

the internal financial controls is to ensure that proper accounting

records are maintained, the Company’s assets are safeguarded,

and the financial information used within the business and, for

publication, is accurate and reliable. Such a system can provide

reasonable, but not absolute assurance against material

misstatement or loss.

Under the terms of the Alternative Investment Fund Management

Agreement the day-to-day management and operation of the

Company has been delegated to the Manager. Clear lines of

accountability have been established between the Board and the

Manager. The Board and the Manager have agreed clearly

defined investment criteria, specified levels of authority and

exposure limits. The Manager is responsible for the design,

implementation and maintenance of controls and procedures to

safeguard the assets of the Company and to manage its affairs

properly. The system extends to financial, operational and

compliance controls and risk management. The Board reviews

the financial reports and performance statistics, including

projections and management accounts from the Manager on a

regular basis. Annually the Audit Committee carries out an

assessment of internal risks and controls. In carrying out its

review, the Audit Committee has regard to the activities of the

Manager, including its risk management, compliance function

and whistle-blowing policies, and the Independent Auditor.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Corporate Governance Report

On the basis of this work, the Board confirms that there is an

ongoing process for identifying, evaluating and managing any

significant business and operational risks faced by the Company

and the Board has carried out a review of the effectiveness of

this process. This process has been in place for the year ended

31 December 2023 and up to the date of the annual report and

accounts.

The Audit Committee considers, and the Board agrees that an

internal audit function is not required by the Company as the

internal control systems operated by the Manager provide

sufficient assurance of the effectiveness of internal controls.

Relations with Shareholders

All shareholders have the opportunity to attend in person and

vote at the AGM. The notice of the AGM sets out the business of

the meeting and items of business are explained in the Directors’

Report on pages 15 to 18. Separate resolutions are proposed for

each substantive issue. Both the Board and representatives of

the Manager are available to answer shareholders’ questions at

the AGM. Proxy voting figures are announced to shareholders at

the AGM.

The Chairman and Manager hold regular discussions with

substantial shareholders, the feedback from which is greatly

valued by the Board. In addition, the Chairman and Directors are

available to enter into dialogue and correspondence with

shareholders regarding the progress and performance of the

Company at any point during the year. They can be contacted at

the registered office address of the Company noted on page 59.

Additionally, the Chairman can be contacted via email at

duncan.budge@dunedinenterprise.com. All correspondence

received from shareholders is passed directly to the Chairman.

The Senior Independent Director is available to shareholders if

their concerns have not been resolved through the normal

channels or where these are inappropriate.

All communications by the Company with shareholders are

approved by the Board.

The Company’s website is www.dunedinenterprise.com. The

Manager’s presentation to shareholders will be available on the

website after the AGM.

Articles of Association

The Articles of Association of the Company may be amended by

special resolution of the Company.

Share buy-backs

Reference is made on page 14 of the Strategic Report for further

information on share buy-backs.

Significant shareholdings

Reference is made on page 16 of the Director’s Report for further

information on the Company’s significant shareholders.

By order of the Board,

Duncan Budge

Chairman

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Audit Committee Report

The Audit Committee is chaired by Angela Lane and comprises

all of the Directors, all of whom are independent. The Audit

Committee’s principal responsibilities are:

• to review the interim and annual financial statements (and

consider their integrity), interim management statements,

announcements and matters relating to accounting policy,

laws and regulations;

• to evaluate the risks to the quality and effectiveness of the

financial reporting process;

• to review the consistency of accounting policies on a year on

year basis;

• to review compliance with applicable accounting standards

and make appropriate judgements, taking into account the

views of the external auditor;

• where requested, to review the content of the Annual Report

and Accounts and advise the Board whether the report as a

whole is fair, balanced and understandable and provides the

information necessary for shareholders to assess the

Company’s position, performance, business model and

strategy;

• to review and recommend for approval by the Board the

valuation of portfolio investments;

• to review the effectiveness of the internal control systems

and the policies and procedures for the identification and

assessment of business risks and the management of these

risks;

• to review corporate governance compliance;

• to review the nature and scope of the work to be performed

by the external auditors, including monitoring the statutory

audit of the annual financial statements;

• to evaluate the independence, objectivity, effectiveness,

resources and qualifications of the auditor and develop and

implement a policy on the engagement of the auditor to

provide non audit services and to review such fees having

regard to their independence;

• to conduct a tender process and make recommendations as

to the appointment and remuneration of the external auditor;

and

• to formally report to the Board on how it has discharged its

duties.

The Audit Committee has a schedule which sets out its annual

work programme to ensure it covers the areas within its remit

appropriately. It met four times during the year to carry out its

responsibilities and senior representatives of the Manager

attended the meetings as required by the Audit Committee. The

main agenda item discussed at each of these meetings was the

valuation of portfolio investments. The external auditor attended

the Audit Committee’s meetings twice in the year and met with

the Audit Committee without representatives of the Manager

being present. In between meetings, the Audit Committee

chairman maintains ongoing dialogue with the Manager and the

external audit partner.

During the year the Audit Committee carried out a review of its

terms of reference and its own effectiveness. It concluded that

the Audit Committee is satisfactorily fulfilling its terms of

reference and is operating effectively.

Significant accounting matters

The significant issue considered by the Audit Committee during

the year in relation to the financial statements of the Company

was the valuation of unquoted investments.

The Company’s accounting policy for valuing unquoted

investments is set out in note 2 on pages 37 to 39, with an

explanation to its implementation in note 4 on pages 40 to 41.

The Audit Committee reviewed and challenged the valuations

prepared by the Manager taking account of the latest available

information about the Company’s investments and the Manager’s

knowledge of the underlying companies through their ongoing

monitoring, position on portfolio company boards and

participation on fund advisory committees. The Audit Committee

satisfied itself that the valuation of investments had been carried

out consistently with prior accounting periods, or that any

change in valuation basis was appropriate, and in accordance

with published industry guidelines.

The external auditor explained the results of their review of the

procedures undertaken by the Manager for the valuation. On the

basis of their audit work, no material differences were identified

by the auditor.

Going Concern

The current investment policy of the Company is to conduct an

orderly realisation of its assets leading ultimately to the

liquidation of the Company. It was concluded that the financial

statements should not be prepared on a going concern basis. No

adjustments were necessary to the investment valuations or the

recognition and measurement of other assets and liabilities

included in the financial statements as a consequence of the

basis of preparation. The auditor’s report contains an “emphasis

of matter” paragraph referring to the non-going concern basis of

preparation.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Audit Committee Report

External Auditor

The Audit Committee monitored the relationship with the external

auditor with a view to ensuring that it did not provide non-audit

services to the Company that had the potential to impair or

appear to impair the independence of its audit role. In light of the

restrictions of the FRC’s Ethical Standard placed on the provision

of non-audit services by the Company’s auditor, the Audit

Committee’s policy is that no tax services will be provided by the

auditor and that any other proposed non-audit services will

require pre-approval by the Audit Committee. There were no

non-audit services provided to the Company by the external

auditor during the year ended 31 December 2023.

The external auditor, Johnston Carmichael LLP, has provided

details of other relationships it has with the Manager and

confirmed to the Board that in its opinion it is independent of the

Manager. The Audit Committee has reviewed the independence

and objectivity of the external auditor. The Audit Committee is

satisfied that the external auditor continues to demonstrate its

independence.

The current audit partner is Bryan Shepka, appointed in 2023

and in his first year. Under the rotation requirements of the FRC’s

Ethical Standard, the Johnston Carmichael LLP audit partner will

rotate every five years. During the year the Committee completed

an external auditor performance evaluation questionnaire. The

Committee reviewed and discussed the results of the

questionnaire. Having considered these matters and the

effectiveness of the external auditor, the Audit Committee has

recommended to the Board that, subject to shareholder approval

at the Annual General Meeting, Johnston Carmichael LLP be re-

appointed as external auditor for the forthcoming year.

Risk Management and Internal Control

The Company does not have an internal audit function. The Audit

Committee believes this is appropriate as all of the Company’s

management functions are delegated to the Manager which has

its own internal control and risk monitoring arrangements. A

report on these arrangements is prepared by the Manager and

submitted to the Audit Committee which it reviews on behalf of

the Board to support the Directors’ responsibility for overall

internal control as set out in the Governance Report on page 20.

A copy of this report is provided to the external auditor for

consideration.

The Company does not have a whistleblowing policy and

procedure in place. The Company delegates this function to the

Manager who is regulated by the FCA and has such policies in

place. The Audit Committee has been informed by the Manager

that these policies meet the industry standards and no

whistleblowing took place during the year.

Angela Lane

Chairman of the Audit Committee

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Remuneration Report

This report has been prepared by the Directors in accordance

with the requirements of section 420 of the Companies Act 2006.

A resolution to approve the report will be proposed at the Annual

General Meeting.

The Company’s independent auditor, Johnston Carmichael LLP,

is required to give an opinion on certain information included in

this report, as indicated below. The auditor’s report on these and

other matters is set out on pages 28 to 32.

Chairman’s Annual Statement

On behalf of the Board and in accordance with Part 2 of

Schedule 8 of the Large and Medium-sized Companies and

Groups (Accounts and Reports) (Amendment) Regulations 2013

(“2013 Regulations”), the Chairman confirms that there have

been no major decisions taken on Directors’ remuneration and

no substantial changes relating to Directors’ remuneration made

during the financial year to 31 December 2023.

1) Directors’ Remuneration Policy Report

This Report provides details of the remuneration policy for the

Directors of the Company and is the same in all material respects

as the policy put into practice by the Board. All Directors are

non-executive, appointed under the terms of their letters of

appointment and under the same terms as in force at the date of

their appointment.

This Remuneration Policy was approved by a resolution of the

Company’s shareholders at the Annual General Meeting of the

Company held on 10 May 2023 and was passed by 99.7%

(876,706 votes) of shareholders voting in favour of the resolution

and 0.3% (2,792 votes) voting against. Its provisions are

applicable until the next triennial shareholder vote. The Company

does not intend to make any significant changes to

implementation of the Remuneration Policy in the current

financial year.

Due to the size of the Board, the Board as a whole fulfils the

function of the Remuneration Committee and considers any

change in the Directors’ Remuneration Policy, as well as

implementation of that policy. A separate Committee has

therefore not been established. The Company’s Directors are all

independent of the Manager.

The non-executive Directors of the Company and all new

Directors of the Company are entitled to such rates of annual

fees, together with any incremental fees payable in recognition of

any Director’s additional time commitment, as the Board at its

discretion shall from time to time determine, subject to the

aggregate annual fees not exceeding an amount set by

shareholders through the Articles of Association currently set at

£200,000, and reimbursement of reasonable fees and expenses

incurred by them in the performance of their duties. The level of

fees paid to Directors is determined by assessing their time

commitment and responsibilities in fulfilling their roles. The

Chairman of the Board, Chairman of the Audit Committee and

Senior Independent Director are paid higher fees, reflecting the

greater amount of time spent on the Company’s business. As

well as monitoring the approach by similar investment trusts to

fees, suitable external advice is sought where appropriate.

In line with the majority of investment trusts, no component of

any Director’s remuneration is subject to performance factors,

introductory fees or an exit payment. Additionally, Directors are

not eligible for pension benefits, share options, long-term

incentive schemes or other benefits. As the Company has no

employees, no consideration needs to be given to employment

conditions in setting Directors’ pay. Subject to the triennial

shareholder vote, the Company has not sought shareholder

views on its remuneration policy.

It is the Company’s policy that Directors do not have service

contracts. The terms of their appointment provide that in line with

the provisions set by the Articles of Association, a Director shall

retire and be subject to election by shareholders at the first

Annual General Meeting after their appointment and stand for re-

election every three years thereafter. However, it is the policy of

the Board that Directors are re-elected annually. The terms also

provide that a Director may be removed from office with a notice

period of three months. No compensation is payable for loss of

office.

The Company indemnifies Directors in respect of costs, charges,

liabilities, damages and expenses, arising out of any claims or

proposed claims made for negligence, default, breach of duty,

breach of trust or otherwise, or relating to any application under

section 1157 of the Companies Act 2006, in connection with the

performance of their duties as Directors of the Company

Table of Directors’ Remuneration Components

2023

2022

£ £

Chairman fee 34,000 34,000

Non-executive Director base fee 23,000 23,000

Additional fee for chairman of the

Audit Committee 3,000 3,000

Additional fee for Senior Independent

Director 3,000 3,000

The fees noted above represent the entirety of fees paid to

Directors.

1 Directors’ fees may be increased, subject to the current maximum

aggregate limit of £200,000 per annum stated in the Company’s

Articles of Association.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Remuneration Report

2) Directors’ Remuneration Implementation Report

This report is prepared in accordance with Schedule 8 of the

2013 Regulations.

The rates of Directors’ fees for the financial year to 31 December

2023 were set out in the Directors’ Remuneration Report

contained in the Company’s 2022 Annual Report and Accounts.

A non-binding ordinary resolution proposing adoption of the

Remuneration Report was put to shareholders at the Company’s

Annual General Meeting held on 10 May 2023 and was passed

by 99.7% (876,706 votes) of shareholders voting in favour of the

resolution, 0.3% (2,792 votes) voting against.

In the financial year to 31 December 2023, no discretion has

been exercised in the award of Directors’ remuneration. The

Company does not anticipate making any significant changes to

implementation of the Remuneration Policy in the current

financial year.

Directors’ emoluments for the year (audited)

All Directors who served during the year ended 31 December

2023 received the emoluments, in the form of fees, as described

in the table below.

Single Total Figure Table (audited)

2023 2022

Annual Annual

Fees Fees

£ £

Duncan Budge 34,000 34,000

Angela Lane 29,000 29,000

Brian Finlayson 23,000 23,000

Total 86,000 86,000

The fees noted above were fixed fees and represent the entire

remuneration paid to Directors.

The remuneration of Directors has been unchanged over the past

five years.

Relative importance of expenditure on pay

As required by the 2013 Regulations, to allow shareholders to

assess the relative importance of expenditure on pay, the table

below demonstrates the total remuneration paid to the Directors

compared to the distributions to shareholders by way of dividend

and any other significant distributions and payments.

2023 2022

£ £ Difference

Spend on Directors’ fees 86,000 86,000 -%

Distributions to shareholders:

(a) dividends 1,376,069 6,371,353 -78%

(b) Tender offer (inc costs) – 41,407,212 -100%

Statement of Directors’ shareholding and share interests

(audited)

The names of the Directors and their shareholdings in the

Company as at 31 December 2023 are shown in the table below.

The shareholdings of connected persons to the Directors are

included in the figures below.

2023 2022

# #

Duncan Budge 7,667 7,667

Brian Finlayson 62,249 62,249

Angela Lane 3,000 3,000

The Company has not been notified of any changes to the

Directors’ shareholdings between 31 December 2023 and

22 March 2024.

In accordance with the Company’s Articles of Association, no

Director is required to hold any shares in the Company by way of

qualification.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Directors’ Remuneration Report

Share price total return

The graph below presents for the period from 31 December 2013 to 31 December 2023 the total shareholder returns compared to the

total return on the FTSE Small Cap (ex-investment companies) and the FTSE All Share (ex-investment companies). These indices are

chosen for comparative purposes only.

The Directors’ Remuneration Report on pages 24 to 26 was approved by the Board of Directors and signed on its behalf on 22 March

2024.

Duncan Budge

Chairman

22 March 2024

Total Shareholder Return (TSR) (Rebased to 100)

2013

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Dunedin Enterprise TSR

350

300

250

200

150

100

FTSE Small Cap exc. Inv Trusts TSR

FTSE All Share exc. Inv Trusts TSR

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Statement of Directors’ Responsibilities

in respect of the Annual Report and the Financial Statements

The Directors are responsible for preparing the Annual Report

and financial statements in accordance with applicable law and

regulations.

Company law requires the Directors to prepare financial

statements for each financial year. Under that law they have

elected to prepare the financial statements in accordance with

UK-adopted International Accounting Standards and applicable

law.

Under company law the Directors must not approve the financial

statements unless they are satisfied that they give a true and fair

view of the state of affairs of the Company and of its profit or

loss for that period. In preparing these financial statements, the

Directors are required to:

• select suitable accounting policies and then apply them

consistently;

• make judgements and estimates that are reasonable and

prudent;

• state whether they have been prepared in accordance with

UK-adopted International Accounting Standards;

• assess the Company’s ability to continue as a going concern,

disclosing, as applicable, matters related to going concern;

and

• use the going concern basis of accounting unless they either

intend to liquidate the Company or to cease operations, or

have no realistic alternative but to do so. As explained in note

1, the Directors do not believe that it is appropriate to

prepare these financial statements on a going concern basis.

The Directors are responsible for keeping adequate accounting

records that are sufficient to show and explain the Company’s

transactions and disclose with reasonable accuracy at any time

the financial position of the Company and enable them to ensure

that its financial statements comply with the Companies Act

2006. They are responsible for such internal control as they

determine is necessary to enable the preparation of financial

statements that are free from material misstatement, whether due

to fraud or error, and have general responsibility for taking such

steps as are reasonably open to them to safeguard the assets of

the Company and to prevent and detect fraud and other

irregularities.

Under applicable law and regulations, the Directors are also

responsible for preparing a Strategic Report, Directors’ Report,

Directors’ Remuneration Report and Corporate Governance

Statement that complies with that law and those regulations.

The Directors are responsible for the maintenance and integrity

of the corporate and financial information included on the

Company’s website. Legislation in the UK governing the

preparation and dissemination of financial statements may differ

from legislation in other jurisdictions.

Responsibility statement of the directors in respect of the

annual financial report

We confirm that to the best of our knowledge:

• the financial statements, prepared in accordance with the

applicable set of accounting standards, give a true and fair

view of the assets, liabilities, financial position and profit or

loss of the Company; and

• the Strategic Report and Directors’ Report include a fair

review of the development and performance of the business

and the position of the Company, together with a description

of the principal risks and uncertainties that it faces.

We 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 Company’s

position and performance, business model and strategy.

Duncan Budge

Chairman

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Independent Auditor’s Report

Opinion

We have audited the financial statements of Dunedin Enterprise

Investment Trust PLC (“the Company”), for the year ended 31

December 2023, which comprise the Income Statement, the

Balance Sheet, the Cash Flow Statement, the Statement of

Changes in Equity and the related notes, including significant

accounting policies. The financial reporting framework that has

been applied in their preparation is applicable law and UK-

adopted international accounting standards.

In our opinion the financial statements:

• Give a true and fair view of the state of the Company’s affairs

as at 31 December 2023 and of its profit for the year then

ended;

• Have been properly prepared in accordance with UK-

adopted international accounting standards; and

• Have been prepared in accordance with the requirements 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 responsibilities for the audit of the financial

statements section of our report. We are independent of the

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. We

believe that the audit evidence we have obtained is sufficient and

appropriate to provide a basis for our opinion.

Emphasis of matter – financial statements prepared on a

basis other than going concern

We draw attention to the disclosure made in note 1 to the

financial statements which explains that the financial statements

have not been prepared on the going concern basis because the

Company’s current objective is to conduct an orderly realisation

of its investment portfolio and return cash to shareholders.

Accordingly, the financial statements have been prepared on a

basis other than going concern as described in note 1.

Our opinion is not modified in respect of this matter.

In relation to the Company’s reporting on how it has applied the

UK Corporate Governance Code, we have nothing material to

add or draw attention to in relation to the directors’ statement in

the financial statements about whether the directors considered

it appropriate to adapt the going concern basis of accounting.

Our responsibilities and the responsibilities of the directors with

respect to going concern as described in the relevant sections of

this report.

Our approach to the audit

We planned our audit by first obtaining an understanding of the

Company and its environment, including its key activities

delegated by the Board to relevant approved third-party service

providers and the controls over provision of those services.

We conducted our audit using information maintained and

provided by Dunedin LLP (the “Alternative Investment Fund

Manager”, the “Company Secretary”, and “Administrator”), to

whom the Company has delegated the provision of services.

We tailored the scope of our audit to reflect our risk assessment,

taking into account such factors as the types of investments

within the Company, the involvement of the Administrator, the

accounting processes and controls, and the industry in which the

Company operates.

The scope of our audit was influenced by our application of

materiality. We set certain quantitative thresholds for materiality.

These together with qualitative considerations, helped us to

determine the scope of our audit and the nature, timing and

extent of our audit procedures on the individual financial

statement line items and disclosures and in the evaluation of the

effect of misstatements, both individually and in aggregate on the

financial statements as a whole.

Independent Auditor’s Report

To the members of Dunedin Enterprise Investment Trust PLC

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Independent Auditor’s Report

Key audit matters

Key audit matters are those matters that, in our professional judgement, 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 forming our opinion thereon, we do not provide a separate opinion on these matters.

We summarise below the key audit matters in arriving at our audit opinion above, together with how our audit addressed these matters

and the results of our audit work in relation to these matters.

Key audit matter How our audit addressed the key audit matter and our conclusions

Valuation and ownership of level 3

investments

(as described on page 22 in the Audit

Committee Report and as per the accounting

policy in note 2, and notes 4 and 12).

The key driver of the Company’s net assets and

total return is the valuation of the level 3

investments portfolio. The valuation of the level

3 investments at 31 December 2023 was £7.5m

(2022: £16.9m).

The level 3 investments are valued in

accordance with the revised International Private

Equity and Venture Capital (IPEV) valuation

guidelines.

Significant judgement is required in applying

these principles and determining certain inputs

to the valuation models.

Given the estimation uncertainty in the valuation

of the level 3 investment portfolio, as well as the

portfolio’s impact on the Company’s Balance

Sheet, accounting for 21.8% of total assets at

31 December 2023, it has been designated as a

key audit matter, being one of the most

significant assessed risks of material

misstatements due to fraud or error.

Additionally, there is a risk that the level 3

investments recorded as held by the Company

may not represent property of the Company

(ownership).

We performed a walkthrough of the valuation process with the Alternative

Investment Fund Manager (AIFM) , to gain an understanding and evaluate the

design of the process and implementation of key controls.

We assessed the degree to which the valuations were subject to estimation

uncertainty and the degree to which the selection and application of the

valuation method, assumptions and data were affected by complexity and

subjectivity.

We corroborated data used in the valuation models to independent sources,

assessing if market conditions met management’s expectations and any

forecasts used in the valuation models were suitable, consistent and the data

was relevant and reliable.

We reperformed the calculation of the valuation models to ensure mathematical

accuracy.

We assessed whether any changes from the prior year valuation models were

appropriate and in line with IPEV guidelines.

We performed back-testing over disposals in the year to the most recent

valuation prior to disposal to assess management’s previous valuations.

We performed a recalculation of the carried interest earned from the underlying

limited partnerships.

We agreed the ownership of the level 3 investment holdings to share certificates

or loan notes and agreed any material disposals in the year to underlying

agreements.

From our completion of these procedures, we identified no material

misstatements in relation to the valuation and ownership of the level 3

investments.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Independent Auditor’s Report

Our application of materiality

We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions

of a reasonably knowledgeable person would be changed or influenced. We use materiality in determining the nature and extent of our

work and in evaluating the results of that work.

We have also set a separate specific materiality in respect of

directors’ remuneration and related party transactions.

During the course of the audit, we reassessed initial materiality

and found no reason to alter the basis of calculation used at

year-end.

Other information

The other information comprises the information included in the

Annual Report other than the financial statements and our

auditor’s report thereon. The directors are responsible for the

other information contained within the Annual Report. Our

opinion on the financial statements does not cover the other

information and, except to the extent otherwise explicitly stated

in our report, we do not express any form of assurance

conclusion thereon. 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 course of 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 this gives

rise to a material misstatement in the financial statements

themselves. If, based on the work we have performed, we

conclude that there is a material misstatement of this other

information, we are required to report that fact.

We have nothing to report in this regard.

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 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

Company, or returns adequate for our audit have not been

received from branches not visited by us; or

£688,000

(2022:

£690,000)

£516,000

(2022:

£518,000)

£34,000

(2022:

£34,500)

Audit Committee reporting threshold – we agreed with the Audit Committee that we would report to them all

differences in excess of 5% of overall materiality in addition to other identified misstatements that warranted

reporting on qualitative grounds, in our view. For example, an immaterial misstatement as a result of fraud.

Performance materiality – performance materiality represents amounts set by the auditor at less than materiality

for the financial statements as a whole, to reduce to an appropriately low level the probability that the aggregate of

uncorrected and undetected misstatements exceeds materiality for the financial statements as a whole.

In setting this we consider the Company’s overall control environment, our past experience of the audit that

indicates a lower risk of material misstatements. Based on our judgement of these factors, we have set

performance materiality at 75% of our overall financial statement materiality.

Materiality for the financial statements as a whole – we have set materiality as 2% of net assets as we believe

that net assets is the primary performance measure used by investors and is the key driver of shareholder value. It

is in our opinion, a standard industry benchmark for materiality for investment trusts and we determined the

measurement percentage to be commensurate with the risk and complexity of the audit and the Company’s listed

status and within the nature of the Company’s investment portfolio which is 21.8% invested in level 3 investments.

Materiality measure Value

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Independent Auditor’s Report

• The 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; or

• A corporate governance statement has not been prepared by

the Company.

Corporate governance statement

We have reviewed the directors’ Statement in relation to going

concern, longer-term viability and that part of the Corporate

Governance Statement relating to the entity’s compliance with

the provisions of the UK Corporate Governance Code specified

for our review by the Listing Rules.

Based on the work undertaken as part of our audit, we have

concluded that each of the following elements of the Corporate

Governance Statement is materially consistent with the financial

statements or our knowledge obtained during the audit:

• The directors’ statement with regards to the appropriateness

of adopting the going concern basis of accounting and any

material uncertainties identified set out on page 15;

• The directors’ explanation as to its assessment of the

Company’s prospects, the period this assessment covers

and why the period is appropriate set out on page 15;

• The directors’ statement on fair, balanced and

understandable set out on page 27;

• The directors’ statement on whether it has a reasonable

expectation that the Company will be able to continue in

operation and meets its liabilities set out on page 15;

• The Board’s confirmation that it has carried out a robust

assessment of the emerging and principal risks set out on

page 13;

• The section of the annual report that describes the review of

the effectiveness of risk management and internal control

systems set out on pages 20 and 21; and

• The section describing the work of the Audit Committee set

out on pages 22 and 23.

Responsibilities of Directors

As explained more fully in the directors’ responsibilities

statement set out on page 27, 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

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 Company or to cease operations, or have no

realistic alternative but to do so.

Auditor 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.

A further description of our responsibilities for the audit of the

financial statements is located on the Financial Reporting

Council’s website at:

http://www.frc.org.uk/auditorsresponsibilities. This description

forms part of our auditor’s report.

Extent to which the audit was considered capable of

detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance

with laws and regulations. We design procedures in line with our

responsibilities, outlined above, to detect material misstatements

in respect of irregularities, including fraud. The extent to which

our procedures are capable of detecting irregularities, including

fraud is detailed below.

We assessed whether the engagement team collectively had the

appropriate competence and capabilities to identify or recognise

non-compliance with laws and regulations by considering their

experience, past performance and support available.

All engagement team members were briefed on relevant

identified laws and regulations and potential fraud risks at the

planning stage of the audit. Engagement team members were

reminded to remain alert to any indications of fraud or non-

compliance with laws and regulations throughout the audit.

We obtained an understanding of the legal and regulatory

frameworks that are applicable to the Company and the sector in

which it operates, focusing on those provisions that had a direct

effect on the determination of material amounts and disclosures

in the financial statements. The most relevant frameworks we

identified include:

• Companies Act 2006;

• FCA listing and DTR rules;

• The principles of the UK Corporate Governance Code

applied by the AIC Code of Corporate Governance (the “AIC

Code”);

• Industry practice represented by the Statement of

Recommended Practice: Financial Statements of Investment

Trust Companies and Venture Capital Trusts (“the SORP”)

issued in November 2014, and updated in April 2021 with

consequential amendments;

• Financial Reporting Standard 102; and

• The Company’s qualification as an investment Trust under

section 1158 of the Corporation Tax Act 2010.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Independent Auditor’s Report

We gained an understanding of how the Company is complying

with these laws and regulations by making enquiries of

management and those charged with governance. We

corroborated these enquiries through our review of relevant

correspondence with regulatory bodies and board meeting

minutes.

We assessed the susceptibility of the Company’s financial

statements to material misstatement, including how fraud might

occur, by meeting with management and those charged with

governance to understand where it was considered there was

susceptibility to fraud. This evaluation also considered how

management and those charged with governance were

remunerated and whether this provided an incentive for

fraudulent activity. We considered the overall control environment

and how management and those charged with governance

oversee the implementation and operation of controls. We

identified a heightened fraud risk in relation to the valuation of

level 3 investments (audit procedures performed in response to

this risk are set out in the section on key audit matter above) and

management override of controls (procedures performed in

response to this risk are set out below).

In addition to the above, the following procedures were

performed to provide reasonable assurance that the financial

statements were free of material fraud or error:

• Reviewing minutes of meetings of those charged with

governance for reference to: breaches of laws and regulation

or for any indication of any potential litigation and claims; and

events or conditions that could indicate an incentive to

commit fraud or provide an opportunity to commit fraud;

• Performing audit work procedures over the risk of

management override of controls, including testing of journal

entries and other adjustments for appropriateness,

recalculating the investment management fees, evaluating

the business rationale of significant transactions outside the

course of normal business and reviewing judgements made

by management in their calculation of accounting estimates

for potential management bias;

• Completion of appropriate checklists and use of our

experience to assess the Company’s compliance with the

Companies Act 2006 and the Listing Rules;

• Agreement of the Financial Statement disclosures to

supporting documentation.

Our audit procedures were designed to respond to the risk of

material misstatements in the financial statements, recognising

that the risk of not detecting a material misstatement due to

fraud is higher than the risk of not detecting one resulting from

error, as fraud may involve intentional concealment, forgery,

collusion, omission or misrepresentation. There are inherent

limitations in the audit procedures described above and the

further removed non-compliance with laws and regulations is

from the events and transactions reflected in the financial

statements, the less likely we would become aware of it.

Other matters which we are required to address

Following the recommendation of the Audit Committee, we were

appointed by the Board on 7 October 2019 to audit the financial

statements for the year ended 31 December 2019 and

subsequent financial periods. The period of our total

uninterrupted engagement is five years, covering the years

ended 31 December 2019 to 31 December 2023.

The non-audit services prohibited by the FRC’s Ethical Standard

were not provided to the Company and we remain independent

of the Company in conducting our audit.

Our 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.

Bryan Shepka (Senior Statutory Auditor)

For and behalf of Johnston Carmichael LLP

Statutory Auditor

Edinburgh, United Kingdom

22 March 2024

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Financial Statements

2023 2022

Revenue Capital Total Revenue Capital Total

Notes £’000 £’000 £’000 £’000 £’000 £’000

Investment income 5 629 – 629 4,951 – 4,951

Gains on investments 11 – 1,052 1,052 – 4,514 4,514

629 1,052 1,681 4,951 4,514 9,465

Expenses

Investment management fee 6 (13) (40) (53) (35) (105) (140)

Other expenses 7 (370) (10) (380) (380) (13) (393)

Profit before finance costs and tax 246 1,002 1,248 4,536 4,396 8,932

Finance costs –––– ––

Profit before tax 246 1,002 1,248 4,536 4,396 8,932

Taxation 8 (77) 77 – (37) 37 –

Profit for the year 169 1,079 1,248 4,499 4,433 8,932

Basic return per ordinary share

(basic & diluted) 10 3.08p 19.59p 22.67p 36.46p 35.92p 72.38p

The total column of this statement represents the Statement of Comprehensive Income of the Company, prepared in accordance with

UK-adopted International Accounting Standards. The supplementary revenue and capital columns are both prepared under guidance

published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

All income is attributable to the equity shareholders of Dunedin Enterprise Investment Trust PLC.

The notes on pages 37 to 50 form part of the financial statements.

Income Statement

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Financial Statements

Balance Sheet

2023 2022

Notes £’000 £’000 £’000 £’000

Non-current assets

Investments at fair value through profit or loss 11 24,685 28,487

Current assets

Other receivables 12 445 5,375

Cash and cash equivalents 9,331 778

9,776 6,153

Current liabilities

Other liabilities 13 (71) (122)

(71) (122)

Net current assets 9,705 6,031

Net assets 34,390 34,518

Capital and reserves

Share capital 14 1,376 1,376

Capital redemption reserve 2 3,149 3,149

Capital reserve – realised 2 25,522 33,947

Capital reserve – unrealised 2 (8,706) (18,220)

Special distributable reserve 2 9,584 9,594

Revenue reserve 2 3,465 4,672

34,390 34,518

Net asset value per share 15 624.8p 627.1p

The financial statements were approved by the Board of Directors on 22 March 2024.

Duncan Budge, Chairman

The notes on pages 37 to 50 form part of the financial statements. The accompanying notes form an integral part of these financial

statements.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Financial Statements

Cash Flow Statement

2023 2022

£’000 £’000 £’000 £’000

Operating activities

Profit before tax 1,248 8,932

Adjustments for:

(Gains) on investments (1,052) (4,514)

Decrease/(increase) in debtors 909 (1,058)

(Decrease)/increase in creditors (50) 34

Net cash inflow from operating activities 1,055 3,394

Investing Activities

Purchase of investments (340) (430)

Drawdown from subsidiary (347) (75)

Purchase of ‘AAA’ rated money market funds (15,848) (28,422)

Sale of investments 15,109 30,007

Distribution from subsidiary – 2,900

Sale of ‘AAA’ rated money market funds 10,300 28,615

Net cash inflows from investing activities 8,874 32,595

Financing Activities

Tender offer – (41,456)

Dividends paid (1,376) (6,371)

Net cash outflows from financing activities (1,376) (47,827)

Net increase/(decrease) in cash and cash equivalents 8,553 (11,838)

Cash and cash equivalents at 1 January 778 12,616

Cash and cash equivalents at 31 December 9,331 778

The notes on pages 37 to 50 form part of the financial statements.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Financial Statements

Statement of Changes in Equity

Capital Capital Capital Special Total

Share redemption reserve – reserve –

distributable

Revenue retained Total

For the year ended capital reserve realised unrealised reserve account earnings equity

31 December 2023 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000

At 31 December 2022 1,376 3,149 33,947 (18,220) 9,594 4,672 29,993 34,518

Profit for the year ––(8,425) 9,514 (10) 169 1,248 1,248

Dividends paid –––––(1,376) (1,376) (1,376)

At 31 December 2023 1,376 3,149 25,522 (8,706) 9,584 3,465 29,865 34,390

Capital Capital Capital Special Total

Share redemption reserve – reserve –

distributable

Revenue retained Total

For the year ended capital reserve realised unrealised reserve account earnings equity

31 December 2022 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000

At 31 December 2021 3,284 1,241 19,721 (8,378) 51,001 6,544 68,888 73,413

Profit for the year ––14,276 (9,842) – 4,499 8,933 8,933

Purchase and cancellation of shares (1,908) 1,908 (50) – (41,407) – (41,457) (41,457)

Dividends paid –––––(6,371) (6,371) (6,371)

At 31 December 2022 1,376 3,149 33,947 (18,220) 9,594 4,672 29,993 34,518

The notes on pages 37 to 50 form part of the financial statements.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

1. General information and basis of preparation

Dunedin Enterprise Investment Trust PLC (“the Company”) is a

public company limited by shares incorporated and registered in

Scotland with company number SC052844. Its registered

address is at Easter Dalry House, 3 Distillery Lane, Edinburgh,

EH11 2BD. The principal activity of the Company is that of a

closed-ended investment trust within the meaning of Section

1158 of the Corporation Tax Act 2010 and its investment

objective and policy is detailed in the Strategic Report.

On 31 December 2020, International Financial Reporting

Standards (IFRS) as adopted by the European Union at that date

was brought into UK law and became UK-adopted International

Accounting Standards, with future changes being subject to

endorsement by the UK Endorsement Board. The Company

transitioned to UK-adopted International Accounting Standards

in its financial statements with effect from 1 January 2021. There

was no impact or changes in accounting policies from the

transition.

The annual financial statements have also been prepared in

accordance with the AIC Statement of Recommended Practice

for the Financial Statements of Investment Trust Companies and

Venture Capital Trusts issued in April 2022 (“the SORP”). Where

presentation guidance set out in the SORP 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.

The financial statements are presented in pounds sterling,

rounded to the nearest thousand.

Going concern

The financial statements have not been prepared on a going

concern basis, since the Company’s current objective is to

conduct an orderly realisation of the investment portfolio and

return cash to shareholders. As the Company is committed to

and can fund an orderly realisation of its investments over an

extended period of time, no adjustments were deemed

necessary to the investment valuations or the recognition and

measurement of other assets and liabilities included in the

financial statements as a consequence of the basis of

preparation.

Critical accounting judgements and key sources of

estimation uncertainty

The preparation of financial statements in conformity with IFRS

requires management to make judgements, estimates and

assumptions that affect the application of policies and the

reported amounts of assets and liabilities, income and expenses

at the date of the financial statements. The estimates and

associated assumptions are based on historical experience and

various other factors that are believed to be reasonable in the

circumstances, the results of which form the basis of making

judgements about carrying values of assets and liabilities that are

not readily apparent from other sources. Actual results may differ

from these estimates.

The estimates and underlying assumptions are reviewed on an

ongoing basis. Revisions to accounting estimates are recognised

in the period in which the estimate is revised if the revision

affects only that period, or in the period of the revision and future

period if the revision affects both current and future periods.

Judgements made by management in the application of IFRS

that have a significant effect on the Financial Statements and

significant estimates are disclosed in note 4.

2. Accounting Policies

a. Consolidation

Subsidiaries are entities over which the Company has control.

The Company controls an entity when it is exposed to, or has the

rights to, variable returns from its involvement with the entity and

has the ability to affect those returns through its power over the

entity. The Company reassesses whether it has control if there

are changes to one or more elements of control. This includes

circumstances in which protective rights held (e.g. those

resulting from a lending relationship) become substantive and

lead to the Company having power over an entity.

As at 31 December 2023 the Company has one subsidiary,

a 100% controlling interest in Dunedin Funds of Fund LP

(“FoF LP”). Under IFRS 10 ‘Consolidated Financial Statements’,

qualifying entities that meet the definition of an investment entity

are not required to prepare consolidated financial statements and

instead account for subsidiaries at fair value through profit or

loss. The Directors deem the Company to be an investment

entity and therefore the Company does not consolidate its

subsidiary but instead carries it at fair value through profit

or loss.

To qualify as an investment entity, the following criteria must be

met by the entity:-

• holds more than one investment;

• has more than one investor;

• has investors that are not related parties to the entity; and

• has ownership interest in the form of equity or similar

interests.

However, the absence of one or more of these characteristics

does not prevent the entity from qualifying as an investment

entity, provided all other characteristics are met and the entity

otherwise meets the definition of an investment entity:

• it obtains funds from one or more investors for the purpose

of providing those investor(s) with professional investment

management services;

• it commits to its investor(s) that its business purpose is to

invest funds solely for returns from capital appreciation,

investment income or both; and

• it measures and evaluates the performance of substantially

all of its investments on a fair value basis.

The Company meets all of the defined criteria of an investment

entity and consequently the Directors deem that the Company is

an investment entity.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

2. Accounting Policies continued

FoF LP does not meet all the defined criteria of an investment

entity as it is 100% owned by the Company. However, the

Directors deem it is nevertheless an intermediate investment

entity as the Company (which holds 100% of the interests in

each entity) has a number of investors.

Therefore, as the Company meets the requirements of an

investment entity, the Company accounts for its subsidiary at fair

value through profit or loss in accordance with IFRS 9. The

Investments at fair value through profit or loss carried in the

Balance Sheet include the Company’s investment in FoF LP. See

note 11 for more detail on the investments held at fair value

through profit or loss.

Accounting standards require that if an investment entity is the

parent of another investment entity, the parent shall also provide

the additional disclosures required by IFRS 12 ‘Disclosure of

Interests in Other Entities’. These disclosures are set out in

note 19.

b. Investments in Dunedin managed limited partnership

funds

The Company indirectly holds investments via Dunedin managed

limited partnership funds. These are accounted for on a look

through basis in the Balance Sheet in “Investments at fair value

through profit or loss”. The Company’s share of the current

assets and current liabilities of each Dunedin managed limited

partnership fund is accounted for in the Balance Sheet in “Other

receivables” and “Other liabilities”. Management fees paid by the

Company to Dunedin managed limited partnership funds are

included in the “Gains on investments” in the Income Statement

accounted for through the “Capital reserve – realised”.

c. Associated Undertakings

The Company holds a number of investments in entities over

which it has significant influence which meet the definition of

associates in IAS28 Investment in Associates. The Company has

taken advantage of the exemption from applying IAS28 as these

investments are held as part of the Company’s portfolio with a

view to the ultimate realisation of capital gains. These

investments are accounted for at fair value through profit and

loss rather than being consolidated.

d. Revenue/capital

The revenue column of the income statement includes all income

and expenses except for the realised and unrealised profit and

loss on investments and the proportion of management fee and

finance costs charged to capital which are included in the capital

column.

e Income

Dividends and other such revenue distributions from investments

are credited to the reveune column of the Income Statement on

the day in which they become ex-dividend. Dividends and other

such revenue distributions where no ex-dividend date is

applicable are brought into account when the Company’s right to

receive payment is established. Where the Company has elected

to receive its dividends in the form of additional shares rather

than 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 creditred to the rvenue account.

Interest on fixed interest securities and deposits is accounted for

on an accruals basis.

Bank deposit interest is recognised on an accruals basis using

the rate of interest agreed with the bank. Income from unquoted

loan stock and deposit interest is included on an effective

interest rate basis.

Interest on loans made to portfolio companies is only recognised

as revenue when the limited partnership in which the portfolio

company is held makes a distribution of that interest income to

the Company. Prior to a distribution being made, the Company

has no right to the income and therefore the revenue recognition

criteria of IFRS 15 and the SORP are not met.

Prior to receipt, and where the valuation of the portfolio company

supports it, the Company’s share of accrued interest on loans to

a portfolio company is effectively reflected in “Investments at fair

value through profit or loss”, as accrued interest on loans to

investee companies directly impacts Dunedin Enterprise

Investment Trust PLC’s share of the net asset value of the limited

partnerships which hold the investments in the underlying

portfolio companies. As a result, on receipt of a distribution of

interest income from the limited partnership funds which hold the

portfolio companies, to the extent that loan interest accruals

previously impacted the value of “Investments at fair value

through profit or loss” there is a transfer from “Gains on

investments” in the capital column of the income statement to

“Investment Income” in the revenue column of the income

statement.

The valuation methodology adopted by the Company is detailed

in note 4.

f. Expenses

All expenses are accounted for on an accruals basis. Expenses

are charged to the revenue column within the Income Statement

except that:

• expenses which are incidental to the acquisition or disposal

of an investment are charged to the capital column as

incurred, and

• expenses are split and presented partly as capital items

where a connection with the maintenance or enhancement

of the value of the investments can be demonstrated, and

accordingly the investment management fee and finance

costs have been allocated 25% to revenue and 75% to

capital in order to reflect the Directors’ expected long-term

view of the nature of the investment returns of the

Company.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

2. Accounting Policies continued

g. Cash and cash equivalents

Cash and cash equivalents comprise current deposits with

banks. These are subject to an insignificant risk of changes in

value and are held for the purpose of meeting short term cash

commitments rather than for investment or other purposes. Cash

balances on term deposits for three months or longer are

classified as investments.

h. Financial assets and liabilities

(i) Classification

The Company classifies its financial assets and liabilities in the

following categories: at fair value through profit or loss; and

financial assets and liabilities at amortised cost. The

classification depends on the nature and purpose of the financial

assets and is determined at the time of initial recognition by

management.

Financial assets at fair value through profit or loss

The financial assets comprise private equity investments, money

market funds, money on deposit and an investment in Dunedin

Fund of Funds LP. The assets in this category are classified as

non-current and are managed and evaluated on a fair value basis

in accordance with the Company’s Investment Strategy and

Business Model.

Financial assets and liabilities at amortised cost

These assets and liabilities are non-derivative financial assets

with fixed or determinable payments that are not quoted in an

active market. They comprise other receivables, cash and cash

equivalents and other payables.

Other receivables comprise prepayments and accrued income

and are classified as current assets if receipt is due within one

year or less (or in the normal operating cycle of the business if

longer). If not, they are presented as non-current assets.

Cash and cash equivalents comprise demand deposits with

banks and are subject to an insignificant risk of changes in value.

Other payables comprise accruals and are classified as current

liabilities if payment is due within one year or less (or in the

normal operating cycle of the business if longer). If not, they are

presented as non-current liabilities.

(ii) Recognition and measurement

Purchases and sales of financial assets are recognised on the

date of the transaction (the date on which the Company commits

to purchase or sell the asset). Investments are initially recognised

at fair value, being the consideration paid and are subsequently

measured at fair value as determined by the Directors.

Fair value is defined as the amount for which an asset could be

exchanged between knowledgeable willing parties in an arm’s

length transaction. The Directors based the fair value of

investments on information received from the Manager. The

Manager’s assessment of fair value of investments is determined

in accordance with IFRS 13 ‘Fair Value Measurement’.

For quoted investments, those which are actively traded in

organised financial markets such as money market funds, fair

value is generally determined by reference to Stock Exchange

quoted market bid prices at the close of business on the Balance

Sheet date.

Unquoted investments are valued by the Directors at fair value,

using the guidelines on valuation published by the International

Private Equity and Venture Capital Association (“IPEV”).

Gains or losses arising from changes in the fair value for the

‘investments at fair value through profit or loss’ are presented in

the Income Statement within ‘gains/(losses) on investments’ in

the period in which they arise.

Financial liabilities at amortised cost consist of other payables.

Other payables are initially recognised at fair value net of

transaction costs incurred and classified as current. Unless

otherwise indicated the carrying amounts of the Company’s

financial liabilities approximate to their fair values.

i. Taxation

Corporation tax payable is provided on taxable profits at the

current rate. Any tax relief obtained on expenses is allocated

between capital and revenue on the assumption that expenses

charged to revenue are matched first against taxable revenue

items. Tax relief is only reflected in capital to the extent that

additional expenses are utilised from capital to reduce or

eliminate the Company’s tax liability.

Deferred taxation is provided on the balance sheet liability

method on all temporary differences, calculated at the rate at

which it is estimated that tax will be payable.

Due to the Company’s status as an investment trust, and its

intention to continue meeting the conditions required to obtain

approval in the foreseeable future, the Company has not

provided deferred tax on any capital gains and losses arising on

the revaluation or on disposal of investments.

j. Dividend

Dividends payable are recognised as a distribution and recorded

in the Statement of Changes in Equity when they become a

liability of the Company.

k. Foreign currencies

Transactions in foreign currencies are recorded using the rate of

exchange ruling at the date of the transaction. Monetary assets

and liabilities denominated in foreign currencies are translated

using the rate of exchange ruling at the balance sheet date and

the gains or losses on translation are included in the income

statement.

l. Segmental analysis

The Directors are of the opinion that the Company is engaged in

a single segment business, being investing in a portfolio of

private equity funds or companies.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

2. Accounting Policies continued

m. Reserves

Under the Company’s Articles of Association, the Directors may,

having obtained the relevant authority of Shareholders pursuant

to the implementation of the B share scheme, capitalise any sum

standing to the credit of any reserve of the Company for the

purposes of paying up, allotting and issuing B Shares to

Shareholders. Please note that the Company currently does not

have sufficient distributable reserves to issue B Shares under the

B share scheme.

(i) Capital Redemption Reserve – the nominal value of

Ordinary Shares if bought back and cancelled and the

nominal value of B Shares redeemed and subsequently

cancelled are added to this reserve. This reserve is non-

distributable.

(ii) Capital Reserve – realised – gains and losses on the

disposal of investments are taken to the Capital Reserve –

realised together with the proportion of management fees,

finance costs and taxation allocated to capital. This reserve

is distributable.

(iii) Capital Reserve – unr ealised – unrealised gains and losses

on investments are taken to the Capital Reserve –

unrealised. This reserve is non-distributable.

(iv) Special Distributable Reserve – the special distributable

reserve is available for the Company to return capital to

shareholders and for buy-back of ordinary shares or

redemption of B Shares.

(v) Revenue Reserve – the net profit/loss arising in the revenue

column of the Statement of Comprehensive Income is

added to this reserve. Dividends paid during the year are

deducted from this reserve.

3. Accounting standards

In the current financial year the Company has applied a number

of new IFRS amendments to standards and interpretations that

are mandatorily effective for the accounting period that began on

or at 1 January 2023. Their adoption has not had a material

impact on the disclosure or on the amounts reported in the

Financial Statements.

Certain new accounting standards and interpretations have been

published that are not mandatory for 31 December 2023

reporting periods and have not been early adopted by the

Company. These standards are not expected to have a material

impact on the Company in the current or future reporting periods

and on foreseeable future transactions.

4. Significant accounting judgements, estimates and

assumptions

The preparation of financial statements requires the use of

estimates, assumptions and judgements. These estimates,

assumptions and judgements affect the reported amounts of

assets and liabilities, at the reporting date. While estimates are

based on best judgement using information and financial data

available, the actual outcome may differ from these estimates.

The key sources of estimation and uncertainty relate to the fair

valuation of the unlisted investments.

Judgements

It is the Company’s judgement that it meets the definition of an

investment entity within IFRS 10. The criteria which define an

investment entity are as follows:

(i) an entity that obtains funds from one or more investors for

the purpose of providing those investors with investment

services;

(ii) an entity that commits to its investors that its business

purpose is to invest funds solely for returns from capital

appreciation, investment income or both;

(iii) an entity that measures and evaluates the performance of

substantially all of its investments on a fair value basis.

The Board has agreed with the recommendations of the Audit

Committee that the Company meets the definition of an

investment entity as it satisfies each of the criteria above and

that this accounting treatment better reflects the Company’s

activities as an investment trust. Specifically, as an investment

trust, the Company’s principal activity is portfolio investment and

the investment objective of the Company (stated in the Strategic

Report on page 12) is to conduct an orderly realisation of its

assets, to be effected in a manner that seeks to achieve a

balance between maximising the value of the Company’s

investments and progressively returning cash to Shareholders.

The key judgements in the fair valuation process are:-

(i) the Manager’s determination of the appropriate application

of the International Private Equity and Venture Capital

Valuation (“IPEV”) Guidelines to each unlisted investment;

and

(ii) the Directors’ consideration of whether each fair value is

appropriate following detailed review and challenge.

The judgement applied in the selection of the methodology used

for determining the fair value of each unlisted investment can

have a significant impact upon the valuation.

Estimates

The key estimate in the financial statements is the determination

of the fair value of the unlisted investments by the Managers for

consideration by the Directors. This estimate is key as it

significantly impacts the valuation of the unlisted investments at

the balance sheet date. The fair valuation process involves

estimates using inputs that are unobservable (for which market

data is unavailable). Fair value estimates are cross-checked to

alternative estimation methods where possible to improve the

robustness of the estimate. As the valuation outcomes may differ

from the fair value estimates a price sensitivity analysis is

provided in Market Risk Sensitivity in note 18 on pages 48 to 50

to illustrate the effect on the financial statements of an over or

under estimation of fair values. The risk of an over or under

estimation of fair values is greater when methodologies are

applied using more subjective inputs.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

4. Significant accounting judgements, estimates and

assumptions continued

Assumptions

The determination of fair value by the Manager involves key

assumptions dependent upon the valuation methodology used.

As explained below, the primary methodologies applied are i)

Earnings Multiple, ii) Revenue Multiple, iii) Net Assets and iv)

Price of Recent Investment. The multiples approach involves

more subjective inputs than the other approaches and therefore

presents a greater risk of over or under estimation.

The key assumptions for the Earnings and Revenue Multiple

approach are that the selection of comparable companies

(chosen on the basis of their business characteristics) and using

either historic or forecast revenues provide a reasonable basis for

identifying the enterprise value of an investment in determining

its fair value. Other assumptions include the appropriateness of

the discount applied to the earnings and revenue multiple in

recognition of the reduced liquidity of the investment.

The key assumption for the Price of Recent Investment method

is that the prices used remain a reasonable proxy for fair value

typically for a period of up to six months from the date of the

relevant transaction. As the time from the reference transaction

increases, the valuation is cross-checked to an Earnings Multiple

based method to ensure reasonableness.

The key assumption for a Net Asset method is that for certain

businesses the value of its net assets is a more appropriate

method to determine its fair value. A discount will be applied to

the net assets depending upon the nature of the underlying

assets. The discount applied to assets has been cross-checked

to independent valuers or external transactions.

Investments

Unlisted Investments

Unlisted investments are valued at fair value by the Directors

following a detailed review and appropriate challenge of the

valuations proposed by the Manager. The Manager’s unlisted

investment policy applies methodologies consistent with the

IPEV guidelines. The principal methodologies applied are market-

based approaches and are follows:-

• Earnings Multiple;

• Revenue Multiple;

• Price of Recent Investment; and

• Net Assets.

The nature of the unlisted portfolio currently will influence the

valuation methodology applied.

• the Price of a Recent Investment will be applied only for a

limited period (typically up to six months) after the date of

acquisition. Generally, after this limited period investments

will be valued on the Earnings Multiple basis;

• when valuing on an Earnings Multiple basis, the

maintainable earnings of a company (EBITDA) are multiplied

by an appropriate multiple. An appropriate multiple is sense

checked against a basket of recent market transactions.

The multiple may be discounted when compared to recent

market transactions to reflect the relative size, growth and

market segment of the comparable companies;

• when valuing on a Revenue Multiple basis, the maintainable

revenue of a company is multiplied by an appropriate

multiple. An appropriate multiple is sense checked against a

basket of recent market transactions. The multiple may be

discounted when compared to recent market transactions

to reflect the relative size, growth and market segment of

the comparable companies;

• an investment may be valued by reference to the value of its

net assets. This is appropriate for businesses whose value

derives mainly from the underlying value of its assets rather

than earnings. In certain circumstances a discount will be

applied to those assets depending on their nature;

• when investments have obtained an exit (either by listing or

trade sale) after the valuation date but before finalisation of

the relevant accounts (interim or final), the valuation is

based on the exit valuation. This applies where the exit was

in process at the valuation date;

• accrued interest on loans to portfolio companies is included

in valuations where there is an expectation that the interest

will be received;

• the fair value of the Company’s investment in Dunedin Fund

of Funds LP is deemed to be the net assets of the LP as it

is the Directors’ opinion that the net assets is derived from

the fair value of the underlying investments as at the

measurement date; and

• investments are valued net of carried interest which has

arisen in the underlying funds. Carried interest is recognised

at the point in time that the underlying fund achieves its

hurdle rate of return.

Gains and losses arising from changes in fair value of

investments are recognised as part of the capital return within

the Income Statement and are then transferred to the unrealised

capital reserve. Gains or losses on investments realised in the

year that have been recognised in the Income Statement are

transferred to the realised capital reserve. In addition, any prior

unrealised gains or losses on such investments are transferred

from the unrealised capital reserve to the realised capital reserve

on disposal of the investment. Gains and losses arising from

changes in fair value are considered to be realised only to the

extent that they are readily convertible to cash in full on the

balance sheet date.

5. Investment income

2023 2022

£’000 £’000

Limited partnership income – UK – 4,722

‘AAA’ rated money market funds 279 166

279 4,888

Deposit interest* 350 63

Total income 629 4,951

* income arising from financial assets that are not investments designated as fair value through profit or loss.

6. Investment management fee

2023 2022

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

Investment management fee 13 40 53 35 105 140

Dunedin provides investment management and general administration services to the Company. The terms of the management fee

arrangements are detailed on page 51.

7. Other expenses

Profit on ordinary activities before taxation is shown after charging the following amounts:

2023 2022

£’000 £’000

Auditor’s remuneration 38 38

Director fees 86 86

Legal fees 12 11

Printing and postage 28 32

Broker fees 10 10

Registrar fees 18 17

Regulatory fees 42 45

Depositary fees 26 22

Other 70 80

Irrecoverable VAT 40 39

370 380

In addition £11,117 of other expenses were charged to capital.

The Company does not directly employ any staff. The expense disclosed above relating to auditor’s remuneration is the total for the

Company. A breakdown of auditor’s remuneration between audit and non-audit services provided to the Company and subsidiaries is

included below.

2023 2022

£’000 £’000

Fees payable to the auditor:

Fees payable to the Company’s auditor for the audit of the Company’s financial statements 38 38

Fees payable for other services:

The audit of the Company’s subsidiaries pursuant to legislation 5 4

Total audit fees 43 42

Non-audit services

Audit related assurance services – –

Total non-audit fees – –

Total fees payable to the auditor by the Company and its subsidiaries 43 42

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

8. Taxation on profit on ordinary activities

2023 2022

Revenue Capital Total Revenue Capital Total

£’000 £’000 £’000 £’000 £’000 £’000

(a) Analysis of charge/(credit) for the year:

UK corporation tax at 23.5% (2022: 19%) 77 (77) – 37 (37) –

Prior year adjustment –––– ––

77 (77) – 37 (37) –

The UK corporation tax rate was 25% from 1 April 2023 giving an effective tax rate of 23.5% (2022 – effective tax rate of 19%).

Changes to the UK corporation tax rates were substantially enacted as part of the Finance Bill 2021 (on 24 May 2021) increasing the

rate to 25% from 1 April 2023.

The tax assessed for the year is lower than the rate of corporation tax. The differences are explained below.

(b) Factors affecting the tax charge for the year:

2023 2022

£’000 £’000

Total return on ordinary activities before tax 1,248 8,932

UK Corporation Tax at 23.5% (2022: 19%) 293 1,697

Effects of:

Capital (gain) not subject to corporation tax (247) (858)

Expenses not deductible 3 2

Non-taxable partnership income and expenses 37 (825)

Excess management expenses carried forward (86) (16)

– –

At 31 December 2023, the Company had net surplus management expenses of £4,202,127 (2022: £4,764,937) in respect of which a

deferred tax asset has not been recognised.

This is because the Company is not expected to generate taxable income in a future period in excess of deductible expenses of that

future period and, accordingly, it is unlikely that the Company will be able to reduce future liabilities through the use of existing surplus

expenses.

9. Dividends

Amounts recognised as distributions to equity holders in the year:

2023 2022

£’000 £’000

Final dividend for the year ended 31 December 2022 – 25.0p paid 19 May 2023 1,376 –

Interim dividend for the year ended 31 December 2022 – 34.0p paid 24 November 2022 – 4,466

Final dividend for the year ended 31 December 2021 – 1.9p paid 13 May 2022 – 250

Second Interim dividend for the year ended 31 December 2021 – 12.6p paid 25 March 2022 – 1,655

1,376 6,371

9. Dividends (continued)

The total dividend paid and proposed in respect of the financial year, which is the basis upon which the requirements of Section 1158 of

the Corporation Tax Act 2010 are considered, is noted below.

2023 2022

£’000 £’000

Interim dividend for the year ended 31 December 2023 – 10.0p paid on 19 January 2024 550 –

Final dividend for the year ended 31 December 2022 – 25.0p paid on 19 May 2023 – 1,376

Interim dividend for the year ended 31 December 2022 – 34.0p paid on 24 November 2022 – 4,466

550 5,842

10. Return per ordinary share

The returns per ordinary share are based on the following figures:

2023 2022

£’000 £’000

Revenue return 169 4,499

Capital return 1,079 4,433

1,248 8,932

Weighted average number of shares in issue 5,504,274 12,342,190

11. Investments

All investments are designated fair value through profit or loss at initial recognition, therefore all gains and losses arise on investments

designated at fair value through profit or loss. Given the nature of the Company’s investments the fair value gains recognised in these

financial statements are not considered to be readily convertible to cash in full at the balance sheet date and therefore the movement

in these fair values are treated as unrealised.

The table below details Dunedin Enterprise’s investment holdings by fund entity in which it is a limited partner.

2023 2022

£’000 £’000

Dunedin Buyout Fund II LP – 9,529

Dunedin Buyout Fund III LP 4,310 4,566

Dunedin Fund of Funds LP 3,208 2,773

7,518 16,868

AAA rated money market funds and cash deposits 17,167 11,619

24,685 28,487

On a look through basis Dunedin Enterprise’s investments are detailed below.

2023 2022

£’000 £’000

Unlisted UK investments 4,310 14,095

Unlisted European investments 3,208 2,773

AAA rated money market funds and cash deposits 17,167 11,619

24,685 28,487

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

11. Investments (continued)

Valuation 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:

• Level 1: Quoted market price (unadjusted) in an active market for an identical instrument.

• Level 2: Valuation techniques based on observable inputs, either directly (i.e., as prices) or indirectly (i.e., derived from prices).

This category includes instruments valued using: quoted market prices in active markets for similar instruments; quoted prices

for identical or similar instruments in markets that are considered less than active; or other valuation techniques where all

significant inputs are directly or indirectly observable from market data.

• Level 3: Valuation techniques using inputs that are not based on observable market data (unobservable inputs). This category

includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable

inputs have a significant effect on the instrument’s valuation. This category includes instruments that are valued based on quoted

prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences

between the instruments.

There have been no changes made to the valuation techniques used during the year.

The table below analyses financial instruments, measured at fair value at the end of the reporting period, by the level in the fair value

hierarchy into which the fair value measurement is categorised:

2023 2022

£’000 £’000

Level 1

AAA rated money market funds and cash deposits 17,167 11,619

Level 2 – –

Level 3

Unlisted investments 7,518 16,868

24,685 28,487

Significant unobservable inputs for Level 3 valuations

The Company’s unlisted investments are all classified as Level 3 investments. The fair values of the unlisted investments have been

determined principally by reference to earnings multiples, revenue multiples and net asset values, with adjustments made as

appropriate to reflect matters such as the sizes of the holdings and liquidity. The weighted average earnings multiple for the portfolio

as at 31 December 2023 was 7.0 times EBITDA (2022: 8.3 times). The weighted average revenue multiple for the portfolio as at 31

December 2023 was 3.4 times revenue (2022: 4.5 times).

The significant unobservable input used in the fair value measurement categorised within Level 3 of the fair value hierarchy together

with a quantitative sensitivity analysis are shown below:

Effect on fair value

Sensitivity 2023 2022

used* £’000 £’000

Earnings multiple 1x 2,157 1,941

Revenue multiple 1x – –

Net assets 10% – 2,311

* the sensitivity analysis refers to an amount added or deducted from the input and the effect this has on the Company’s unlisted

investments

The fair value of the Company’s unlisted investments is sensitive to changes in the assumed earnings/revenue multiple and net asset

value. An increase in the earnings/revenue multiple used would lead to an increase in the fair value of the investment portfolio and a

decrease in the earnings/revenue multiple would lead to a decrease in the fair value. An increase in the net asset value used would

lead to an increase in the fair value of the investment portfolio and a decrease in the net asset value would lead to a decrease in the

fair value.

11. Investments (continued)

The following shows a reconciliation from the beginning to the end of the year for fair value measurements in Level 1 and Level 3 of

the fair value hierarchy.

Level 3 Level 3 Level 1

AAA rated

money

UK European market

Unlisted Unlisted funds Total

£’000 £’000 £’000 £’000

Cost at 31 December 2022 31,369 3,719 11,619 46,707

Unrealised (depreciation) (17,274) (946) – (18,220)

Valuation at 31 December 2022 14,095 2,773 11,619 28,487

Purchases 340 347 15,848 16,535

Sales (10,519) – (10,300) (20,819)

Realised loss on sales (9,032) ––(9,032)

Increase in unrealised (depreciation)/appreciation 9,426 88 – 9,514

Valuation at 31 December 2023 4,310 3,208 17,167 24,685

Cost at 31 December 2023 12,159 4,066 17,167 33,392

Unrealised (depreciation) (7,849) (858) – (8,707)

There have not been any movements between the levels of the fair value hierarchy during the year.

The Company recognised proceeds of £20.8m (2022: £65.5m) from investments sold in the year. The book cost of these investments

when they were purchased was £29.9m (2022: £51.2m). These investments have been revalued over time and until they are sold any

unrealised gains/losses were included in the fair value of the investments.

Level 3 Level 3 Level 1

AAA rated

money

UK European market

Unlisted Unlisted funds Total

£’000 £’000 £’000 £’000

Cost at 31 December 2021 52,887 4,267 11,812 68,966

Unrealised (depreciation)/appreciation (9,310) 932 – (8,378)

Valuation at 31 December 2021 43,577 5,199 11,812 60,588

Purchases 430 75 28,422 28,927

Sales (34,027) (2,900) (28,615) (65,542)

Realised gain on sales 12,079 2,277 – 14,356

Increase in unrealised (depreciation)/appreciation (7,964) (1,878) – (9,842)

Valuation at 31 December 2022 14,095 2,773 11,619 28,487

Cost at 31 December 2022 31,369 3,719 11,619 46,707

Unrealised (depreciation) (17,274) (946) – (18,220)

2023 2022

£’000 £’000

Realised (loss)/gains on sales (9,032) 14,356

Unrealised depreciation/(appreciation) recognised in prior years 9,681 (9,090)

649 5,266

(Decrease) in unrealised appreciation (167) (752)

Other movements 570 –

Gains on investments 1,052 4,514

Included within unlisted investments are investments valued at £nil (2022: £13.5m) where the Company’s interest is between 20% and

50% of the equity. These investments have been accounted for at fair value through profit or loss as set out in Note 2(c).

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

11. Investments (continued)

Significant interests

(a) At 31 December 2023, the Company held between 20% and 50% of the allotted share capital of the following companies:

% of

equity held Share

Country of directly Latest capital &

incorporation or % of and through available reserves EBITDA

Name registration equity held funds accounts £’000 £’000

Dunedin Buyout Fund II LP Scotland 29.7 29.7 31.12.23 n/a n/a

Warrior Topco Limited Scotland – 23.0 30.09.22 (17,329) 2,618

(b) Other interests of 10% or more of any class of allotted share capital:

Country of % of equity held

incorporation % of equity directly and

Name or registration held directly through funds

Dunedin Buyout Fund III LP Scotland 19.6 19.6

Equity percentages shown are fully diluted, based on the latest audited accounts available, to take account of options and warrants

which have been issued, and conversion rights.

12. Other receivables

2023 2022

£’000 £’000

Prepayments 13 31

Other debtors 432 5,344

445 5,375

13. Other liabilities

2023 2022

£’000 £’000

Accruals 71 122

71 122

14. Called-up share capital

Nominal 31 December Nominal 31 December

No. 2023 No. 2022

‘000 £’000 ‘000 £’000

Allotted, called-up and fully paid ordinary shares:

At 1 January 2023 5,504 1,376 13,137 3,284

Repurchased during the year ––(7,633) (1,908)

At 31 December 2023 5,504 1,376 5,504 1,376

The capital of the Company is managed in accordance with its investment policy and objective which are detailed in the Strategic

Report on page 12.

At 22 March 2024 no ordinary shares have been repurchased since 31 December 2023. The Directors exercise the power to make

repurchases only where they believe a repurchase is in the interests of the members as a whole and will result in an increase in the net

asset value per ordinary share. The Company does not hold any shares in treasury.

15. Net asset value per share

The net asset value per share is calculated on shareholders’ funds of £34,389,634 (2022: £34,517,770) and on 5,504,274 ordinary

shares in issue at the year end (2022: 5,504,274).

16. Capital commitments

There were outstanding capital commitments of £7.6m (2022: £9.6m) in respect of investments at the end of the year.

Outstanding capital commitments are as noted below:-

2023 2022

£’000 £’000

Dunedin Buyout Fund II LP – 1,358

Dunedin Buyout Fund III LP 6,917 7,461

Realza Capital FCR 729 745

7,646 9,564

17. Contingencies

There were no contingent liabilities at the year end (2022: £nil).

18. Financial instruments and associated risks

The Company’s financial instruments comprise ordinary shares, fixed and floating interest rate investments, cash balances and liquid

resources. The Company holds financial assets in accordance with its investment policy to invest in unquoted companies both directly

and through specialist vehicles. Investments are valued at fair value. For quoted stocks this is at bid price unless this is not considered

to be an accurate representation of fair value. In respect of unquoted investments, these are fair valued by the Directors using rules

consistent with International Private Equity and Venture Capital Valuation Guidelines. The fair value of all other financial assets and

liabilities is represented by their carrying value in the Balance Sheet.

The Company’s investing activities expose it to types of risk that are associated with the financial instruments and the market in which

it invests. The most important types of financial risk to which the Company is exposed are market risk, interest rate risk, credit risk,

liquidity risk and currency risk. The nature and extent of the financial instruments outstanding at the balance sheet date and the risk

management policies employed by the Company are discussed below.

Market risk – the risk that the value of a financial instrument will change as a result of changes to market prices is one that is

fundamental to the Company’s objective. The portfolio is continually monitored to ensure an appropriate balance of risk and reward in

order to achieve the Company’s objective. Some of the risk can be mitigated by diversifying the portfolio across business sectors,

asset classes and regions. Details of the Company’s investment portfolio at the balance sheet date are disclosed in the schedule of

investments on pages 8 to 10. The Company’s overall market positions are monitored by the Manager on an ongoing basis and by the

Board quarterly.

Market risk sensitivity

22% (2022: 49%) of the Company’s net assets are invested in unquoted companies. The fair value of the unlisted companies is

influenced by estimates, assumptions and judgements made in the fair valuation process (see note 4 on pages 40 to 41). A sensitivity

analysis is provided below which recognises that the valuation methodologies employed involve different levels of subjectivity in their

inputs.

As at 31 December 2023

Fair value of Variable Input

investments Sensitivity Impact % of

£’000 (%) £’000 Net Assets

Earnings multiple 5,445 ±10 ±1,253 ±3.6

Revenue multiple – ±10 ––

As at 31 December 2022

Fair value of Variable Input

investments Sensitivity Impact % of

£’000 (%) £’000 Net Assets

Earnings multiple 6,053 ±10 ±1,321 ±3.8

Revenue multiple – ±10 ––

Net assets 9,530 ±20 ±4,560 ±13.2

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

18. Financial instruments and associated risks continued

Interest rate risk – some of the Company’s financial assets are interest bearing, at both fixed and variable rates. As a result, the

Company is subject to exposure to fair value interest rate risk due to fluctuations in the prevailing levels of market interest rates. The

table below analyses the Company’s financial assets and details the weighted average interest rate and life of fixed rate lending.

Financial Assets of the Company

31 December 2023

Fixed Floating Nil

rate rate rate Total

Currency £’000 £’000 £’000 £’000

Sterling 4,310 26,498 – 30,808

Euro 1,540 – 1,668 3,208

Total 5,850 26,498 1,668 34,016

31 December 2022

Fixed Floating Nil

rate rate rate Total

Currency £’000 £’000 £’000 £’000

Sterling 14,095 12,397 – 26,492

Euro 1,331 – 1,442 2,773

Total 15,426 12,397 1,442 29,265

The fixed rate assets comprise fixed rate lendings to investee companies. Fixed rate lendings have a weighted average interest rate of

16% per annum (2022: 9%) and a weighted average life to maturity of 2.6 years (2022: 1.7 years). The floating rate assets consist of

cash and AAA rated cash OEICs. The nil interest rate bearing assets represent the equity content of the investment portfolio. Interest

rate risk is managed on an ongoing basis by the Manager and on a quarterly basis by the Board.

Due to the relatively short period to maturity of the floating rate investments held within the portfolio, it is considered that an increase

or decrease of 25 basis points in interest rates as at the reporting date would not have had a significant effect on the Company’s net

assets or total return for the period.

Credit risk – credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to

discharge an obligation. The portfolio consists of the following financial instruments:

2023 2022

£’000 £’000

Unquoted debt 5,850 15,426

AAA rated cash OEICs 17,167 11,619

Cash deposits 9,331 778

Total 32,348 27,823

Investment in the debt of unquoted companies either directly, via Dunedin managed funds or via third-party managed funds (both

limited partnership funds and quoted stocks) is by its nature subject to potential credit losses. The Company’s exposure to any one

entity is carefully monitored. The unquoted investment portfolio is further diversified by asset class, sector and region. Liquid assets

(cash deposits and AAA rated cash OEICs) are divided between a number of different financial institutions, each of whose credit rating

is assessed. Credit risk is monitored by the Manager on an ongoing basis and on a quarterly basis by the Board.

Liquidity risk – the Company has significant investments in unquoted companies which are inherently illiquid. As a result, the Company

may not be able to quickly liquidate some of its investments in these companies at an amount close to its fair value in order to meet its

liquidity requirements. The Company manages its liquid investments to ensure sufficient cash is available to meet contractual

commitments and also seeks to have cash or readily convertible investments available to meet other short-term financial needs.

Liquidity risk is monitored by the Manager on an ongoing basis and on a quarterly basis by the Board.

Currency risk – the Company is exposed to currency risk as a result of investing in companies and funds denominated in euros. The

sterling value of these investments can be influenced by movements in foreign currency exchange rates. Currency risk is monitored by

the Manager on an ongoing basis and on a quarterly basis by the Board.

18. Financial instruments and associated risks continued

Currency Rate Sensitivity

At 31 December 2023, if Sterling had strengthened by 5% in relation to all currencies, with all other variables held constant, total net

assets would have decreased by the amounts shown below. A 5% weakening of sterling against all currencies, with all other variables

held constant, would have had an equal but opposite effect on the Financial Statement amounts. The analysis is performed on the

same basis for 2022.

2023 2022

£’000 £’000

Euro 153 145

Total 153 145

19. Investments in unconsolidated entities

Details of the undertakings which were unconsolidated subsidiaries held at 31 December 2023 and 31 December 2022 are listed

below:

Name: Dunedin Fund of Funds LP

Direct or indirect holding: Direct

Country of incorporation: Scotland

Principal activity: Private equity fund of funds

Proportion of share: 100%

Dunedin Fund

of Funds LP

£’000

Valuation at 31 December 2022 2,773

Net capital movements 347

Valuation movements 88

Valuation at 31 December 2023 3,208

20. Related party transactions

The Company has investments in Dunedin Buyout Fund II LP, Dunedin Buyout Fund III LP and Dunedin Fund of Funds LP. Each of these

limited partnerships are managed by Dunedin. The Company has paid a management fee of £0.2m (2022: £0.4m) in respect of these

limited partnerships. The total investment management fee payable by the Company to the Manager is therefore £0.3m (2022: £0.6m).

Since the Company began investing in Dunedin Buyout Funds (the “Funds”) executives of the Manager have been entitled to participate in

a carried interest scheme via the Funds. Performance conditions are applied whereby any gains achieved through the carried interest

scheme associated with the Funds are conditional upon a certain minimum return having been generated for the limited partner investors.

Additionally, within Dunedin Buyout Fund II LP and Dunedin Buyout Fund III LP the economic interest of the Manager is aligned with that

of the limited partner investors by co-investing in this fund.

As at 31 December 2023 there is a provision made within Investments for carried interest of £1.1m (2022: £1.5m) relating to Dunedin

Buyout Fund III LP. Current executives of the Manager are entitled to 42% of the carried interest in Dunedin Buyout Fund III LP.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notes to the Accounts

Management Fees (unaudited)

The terms of the management fees are:-

Vehicle Fee

Fund of Funds Limited Partnership 1.5 per cent on the value of investments plus 0.5 per cent on undrawn commitments

to third–party funds

Direct investments in individual companies 1.5 per cent on the value of investments

Dunedin Managed Funds Same fees as paid by third–party investors in such Funds

Third-party managed funds 1.5 per cent on value of investments

Listed private equity funds 1.5 per cent on the value of investments

Cash 0.5 per cent on cash balances not committed to funds through the Dunedin Fund of

Funds LP

The notice period on the alternative investment fund management agreement is 12 months. No compensation payment is payable by the

Company to the Manager on termination except where: (i) the Company notifies the Manager of an intended breach of, or change to, any

value of the agreed thresholds and profiles and in the opinion of the Manager, the intended breach or proposed change in value is such

that it would cause the Manager to be in breach of, or otherwise become unable to comply with, its obligations under the AIFMD Rules; or

(ii) the Manager notifies the Company of any proposed change to any value of the agreed thresholds and profiles expressly required by the

FCA and the Company does not agree to the proposed change, in which case the Manager is entitled to receive an amount equal to the

remuneration it would have received had the full 12 months’ termination notice been given.

Notice is hereby given that the forty-eighth Annual General

Meeting of the shareholders of Dunedin Enterprise Investment

Trust PLC will be held at 12 noon on 15 May 2024 at the offices

of Dickson Minto WS, 16 Charlotte Square, Edinburgh, EH2 4DF

for the following purposes:

To consider and, if thought fit, pass the following resolutions.

Resolutions 1 to 7 will be proposed as ordinary resolutions and

resolutions 8 to 9 will be proposed as special resolutions.

Ordinary Business

1. To receive and adopt the report of the Directors and

auditor’s and the audited accounts for the year ended 31

December 2023.

2. To approve the Directors’ remuneration report for the year

ended 31 December 2023.

3. To re-elect Angela Lane as a Director.

4. To re-elect Duncan Budge as a Director.

5. To re-elect Brian Finlayson as a Director.

6. To re-appoint Johnston Carmichael LLP as auditor of the

Company to hold office until the conclusion of the next

general meeting at which accounts are laid before the

Company.

7. To authorise the Directors to fix the remuneration of the

auditors.

Special Business

8. That, in substitution for any existing authority, the Company

be and is hereby generally and unconditionally authorised

pursuant to and in accordance with section 701 of the

Companies Act 2006 (the “Act”) to make market purchases

(within the meaning of section 693(4) of the Act) of fully paid

ordinary shares of 25 pence each in the capital of the

Company provided that:

(i) the maximum aggregate number of ordinary shares

hereby authorised to be purchased is 825,090;

(ii) the minimum price which may be paid for an ordinary

share shall be 25 pence (excluding expenses);

(iii) the maximum price (exclusive of expenses) which shall

be paid for an ordinary share shall be not more than

the higher of: (i) an amount equal to 105 per cent of

the average of the middle market quotations for an

ordinary share taken from and calculated by reference

to the London Stock Exchange Daily Official List for

the five business days immediately preceding the day

on which the shares are purchased; (ii) the price of the

last independent trade on the trading venue where the

purchase is carried out; and (iii) the highest current

independent purchase bid on that venue.

(iv) the authority hereby conferred shall expire at the

conclusion of the next Annual General Meeting of the

Company after the passing of this resolution (or, if

earlier, the date which is 15 months after the passing

of this resolution) unless the authority is varied,

revoked or renewed prior to such time; and

(v) the Company may make a contract to purchase shares

under the authority hereby conferred prior to the expiry

of such authority and may make a purchase of shares

pursuant to any such contract notwithstanding such

expiry.

9. That a general meeting other than an annual general

meeting may be called at not less than 14 clear days’

notice.

By Order of the Board

Dunedin LLP

Secretary

28 March 2024

Registered Office:

Easter Dalry House, 3 Distillery Lane, Edinburgh, EH11 2BD

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notice of Annual General Meeting

Notice of Annual General Meeting (“AGM”)

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notice of Annual General Meeting

Notes

1. THIS DOCUMENT IS IMPORTANT AND REQUIRES

YOUR IMMEDIATE ATTENTION. If you are in any doubt as

to the action to be taken, you should seek personal financial

advice from your independent financial adviser authorised

under the Financial Services and Markets Act 2000 if you

are resident in the United Kingdom or, if not, from another

appropriate independent financial adviser.

2. If you have sold or otherwise transferred all your shares in

Dunedin Enterprise Investment Trust PLC, please forward

this document, together with the Form of Proxy enclosed, at

once to the purchaser or transferee or to the stockbroker,

bank or other agent through whom the sale or transfer was

effected for transmission to the purchaser or transferee. If

you have sold or otherwise transferred only part of your

holding of shares, you should retain these documents.

3. Members are entitled to appoint a proxy to exercise all or

any of their rights to attend and to speak and vote on their

behalf at the meeting. You can only appoint a proxy using

the procedures set out in these notes and the notes to the

Form of Proxy. A shareholder may appoint more than one

proxy in relation to the AGM provided that each proxy is

appointed to exercise the rights attached to a different

share or shares held by that shareholder. A proxy need not

be a shareholder of the Company. Appointment of a proxy

does not preclude a member from attending the meeting

and voting in person.

4. To appoint a proxy using the enclosed Form of Proxy, it

must be lodged by 12 noon on 13 May 2024 with the

Company’s registrars, Equiniti, Aspect House, Spencer

Road, Lancing, West Sussex BN99 6DA. The notes to the

Form of Proxy explain how to direct your proxy how to vote

on each resolution or withhold their vote.

5. Pursuant to regulation 41 of the Uncertificated Securities

Regulations 2001, the Company has specified that to be

entitled to attend and vote at the meeting (and for the

purpose of determining the number of votes they may cast),

members must be entered on the register of members at

6.30 pm on 13 May 2024. If the meeting is adjourned then,

to be so entitled, members must be entered on the register

of members 48 hours before the time fixed for the

adjourned meeting, or, if the Company gives notice of the

adjourned meeting, at any other time specified in that

notice. In the case of joint holders, the vote of the senior

holder who tenders a vote shall be accepted to the

exclusion of the votes of the other joint holder(s). Seniority

is determined by the order in which the names of the joint

holders appear in the Company’s register of members in

respect of the joint holding (the first named being the most

senior).

6. Any person to whom this notice is sent who is a person

nominated under Section 146 of the Companies Act 2006

to enjoy information rights (a “Nominated Person”) may,

under an agreement between him/her and the shareholder

by whom he/she was nominated, have a right to be

appointed (or to have someone else appointed) as a proxy

for the AGM. If a Nominated Person has no such proxy

appointment right or does not wish to exercise it, he/she

may, under any such agreement, have a right to give

instructions to the shareholder as to the exercise of voting

rights.

7. The statement of the rights of shareholders in relation to the

appointment of proxies in paragraphs 3 and 4 above does

not apply to Nominated Persons. The rights described in

these paragraphs can only be exercised by shareholders of

the Company.

8. As at 28 March 2024 (being the last practicable day prior to

the publication of this Notice) the Company’s issued share

capital consisted of 5,504,274 ordinary shares of 25 pence

each, carrying one vote each. Therefore, the total voting

rights in the Company as at 28 March 2024 are 5,504,274.

9. Any member attending the AGM has the right to ask

questions. Pursuant to section 319A of the Companies Act

2006, the Company must provide an answer to any

question which is put by a member relating to the business

being considered, except if a response would not be in the

interests of the Company or for the good order of the

meeting, the response has already been given on a website

in the form of an answer to a question or if to do so would

involve the disclosure of confidential information or interfere

unduly with the preparation for the meeting.

10. In accordance with section 311A of the Companies Act

2006, the contents of this notice of meeting, details of the

total number of shares and shares of each class in respect

of which members are entitled to exercise voting rights at

the AGM, and, if applicable, any members’ statements,

members’ resolutions or members’ matters of business

received by the Company after the date of this notice will be

available on the Company’s website

www.dunedinenterprise.com.

11. Shareholders may require the Company to place on its

website a statement, made available also to the Company’s

auditor, setting out any matter relating to the audit of the

Company’s accounts, including the Auditor’s Report and

the conduct of the audit, which shareholders intend to raise

at the AGM. The Company becomes required to place such

a statement on the website once a) members with at least

5% of the total voting rights of the Company or b) at least

100 members who are entitled to vote and on whose shares

an average sum per member of at least £100 has been

paid, have submitted such a request to the Company. A

request (i) must identify the statement to which it relates; (ii)

must be authenticated by the person making it; and

(iii) must be received by the Company at least one week

before the AGM. Members seeking to do this should write

to the Company at its registered office providing their full

name and address.

12. A member of the Company which is a corporation may

authorise a person or persons to act as its representative(s)

at the AGM. In accordance with the provisions of the

Companies Act 2006 (as amended by the Companies

(Shareholders’ Rights) Regulations 2009), each such

representative may exercise (on behalf of the corporation)

the same powers as the corporation could exercise if it

were an individual member of the Company, provided that

they do not do so in relation to the same shares.

13. CREST members who wish to appoint a proxy or proxies

through the CREST electronic proxy appointment service

may do so by using the procedures described in the CREST

Manual. CREST Personal Members or other CREST

sponsored members, and those CREST members who have

appointed a service provider(s), should refer to their CREST

sponsor or voting service provider(s), who will be able to

take the appropriate action on their behalf.

14. In order for a proxy appointment or instruction made using

the CREST service to be valid, the appropriate CREST

message (a “CREST Proxy Instruction”) must be properly

authenticated in accordance with Euroclear UK &

International Limited’s specifications, and must contain the

information required for such instruction, as described in

the CREST Manual. The message, regardless of whether it

constitutes the appointment of a proxy or is an amendment

to the instruction given to a previously appointed proxy

must, in order to be valid, be transmitted so as to be

received by the issuer’s agent (ID RA19) by 12 noon on 13

May 2024 (excluding any parts of the day that is not a

business day), or in the event of an adjournment of the

meeting, 48 hours before the adjourned meeting. For this

purpose, the time of receipt will be taken to be the time (as

determined by the timestamp applied to the message by

the CREST Application Host) from which the issuer’s agent

is able to retrieve the message by enquiry to CREST in the

manner prescribed by CREST. After this time any change of

instructions to proxies appointed through CREST should be

communicated to the appointee through other means.

15. CREST members and, where applicable, their CREST

sponsors, or voting service providers should note that

Euroclear UK and International Limited does not make

available special procedures in CREST for any particular

message. Normal system timings and limitations will,

therefore, apply in relation to the input of CREST Proxy

Instructions. It is the responsibility of the CREST member

concerned to take (or, if the CREST member is a CREST

personal member, or sponsored member, or has appointed

a voting service provider, to procure that his/her CREST

sponsor or voting service provider(s) take(s)) such action as

shall be necessary to ensure that a message is transmitted

by means of the CREST system by any particular time. In

this connection, CREST members and, where applicable,

their CREST sponsors or voting system providers are

referred, in particular, to those sections of the CREST

Manual concerning practical limitations of the CREST

system and timings. The CREST manual can be viewed at

www.euroclear.com.

The Company may treat as invalid a CREST Proxy

Instruction in the circumstances set out in Regulation

35(5)(a) of the Uncertificated Securities Regulations 2001.

16. If you are an institutional investor you may be able to

appoint a proxy electronically via the Proxymity platform, a

process which has been agreed by the Company and

approved by the Registrar. For further information regarding

Proxymity, please go to www.proxymity.io. Your proxy must

be lodged by 12 noon on 13 May 2024 in order to be

considered valid. Before you can appoint a proxy via this

process you will need to have agreed to Proxymity’s

associated terms and conditions. It is important that you

read these carefully as you will be bound by them and they

will govern the electronic appointment of your proxy.

17. You may not use any electronic address provided either in

this Notice of AGM or any related documents (including the

Form of Proxy) to communicate with the Company for any

purposes other than those expressly stated.

18. Shareholders who prefer to register the appointment of their

proxy electronically via the internet can do so through

Equiniti’s website Shareview, by either logging in or creating

an online portfolio at www.shareview.co.uk and following

the on-screen instructions. You will need your Shareholder

Reference Number shown on the form of proxy. A proxy

appointment made electronically will not be vaild if sent to

any other address other than those provided or if received

after 12 noon on 13 May 2024.

19. Under Section 338 of the Companies Act 2006, a member

or members meeting the qualification criteria set out at note

11, may, subject to conditions, require the Company to give

to members notice of a resolution which may properly be

moved and is intended to be moved at that meeting. The

conditions are that: (i) the resolution must not, if passed, be

ineffective (whether by reason of inconsistency with any

enactment or the Company’s constitution or otherwise); (ii)

the resolution must not be defamatory of any person,

frivolous or vexatious; (iii) the request must identify the

resolution to which notice is to be given; (iv) the resolution

must be received by the Company not later than 6 weeks

before the AGM; (v) the resolution must be authenticated by

the person making it; and (vi) members seeking to do this

should write to the Company at its registered office

providing their full name and address.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notice of Annual General Meeting

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Notice of Annual General Meeting

20. Under Section 338A of the Companies Act 2006, a member

or members meeting the qualification criteria set out at note

11, may, subject to conditions, require the Company to

include in the business to be dealt with at the AGM a matter

(other than a proposed resolution) which may properly be

included in the business (a matter of business). The

conditions are that: (i) the matter of business must not be

defamatory of any person, frivolous or vexatious; (ii) the

request must identify the matter of business by either

setting it out in full or, if supporting a statement sent by

another member, clearly identify the matter of business

which is being supported; (iii) must be accompanied by a

statement setting out the grounds for the request; (iv) must

be authenticated by the person or persons making it (see

note 12); and (v) must be received by the Company not later

than 6 weeks before the Annual General Meeting.

21. Copies of the letters of appointment for directors will be

available for inspection at the offices of Dickson Minto WS,

16 Charlotte Square, Edinburgh, EH2 4DF and at the

Company’s registered office from the date of this notice

until the conclusion of the AGM and at the AGM itself for at

least 15 minutes prior to the beginning of the meeting until

the end of the meeting.

22. The Board would also welcome questions from

shareholders in advance of the AGM. Please submit all

questions to info@dunedinenterprise.com by 13 May 2024.

The Board will provide answers to these questions after the

AGM.

If it is necessary to provide you with further information

about the AGM, or notify you about any alternative

arrangements, we will do so on our website

(www.dunedinenterprise.com) and by RNS.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Information for Investors

Dunedin Enterprise is managed by Dunedin. Dunedin is

authorised and regulated by the Financial Conduct Authority. All

enquiries in relation to Dunedin Enterprise should be directed to

Dunedin at Easter Dalry House, 3 Distillery Lane, Edinburgh,

EH11 2BD or info@dunedinenterprise.com.

The Company’s share price is available on the Company website

www.dunedinenterprise.com or else on various websites such as

www.trustnet.com.

Investors can buy and sell shares in an investment trust directly

through a stockbroker or indirectly through a lawyer, accountant

or other professional adviser. An investment trust should be

considered only as part of a balanced portfolio.

Registrar

Equiniti

Aspect House

Spencer Road

Lancing

West Sussex BN99 6DA

Telephone: 0371 384 2440

International: +44 121 415 7047

Website: www.shareview.co.uk

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Glossary of Terms and Definitions

Glossary of Terms and Definitions and Alternative

Performance Measures

Buy-out fund

A fund which acquires stakes in established unquoted

companies.

Commitment

The amount committed by the Company to a fund investment,

whether or not such amount has been advanced in whole or in

part by or repaid in whole or in part to the Company.

Distribution

A return that an investor in a private equity fund receives.

Draw down

A portion of a commitment which is called to pay for an

investment.

EBITDA

Earnings before interest expense, taxes, depreciation and

amortisation.

Enterprise value (“EV”)

The value of the financial instruments representing ownership

interests in a company plus the net financial debt of the

company.

Net Asset Value (“NAV”) per Ordinary Share

The value of the Company’s assets and cash held less any

liabilities for which the Company is responsible divided by the

number of shares in issue.

NAV Total Return

The NAV total return is calculated by adding dividends and

capital returned in the period to the increase or decrease in the

net asset value. The dividends or capital returned are assumed to

be re-invested in the quarter that the dividend or capital return is

paid.

2023 2022

NAV per share at start of year (pence) 627.1 558.8

NAV per share at end of year (pence) 624.8 627.1

Change in year -0.4% +12.2%

Impact of dividend reinvestments +4.0% +9.5%

Total NAV return for the year +3.6% +21.7%

Ongoing Charges

Management fees and all other recurring operating expenses that

are payable by the Company excluding the costs of purchasing

and selling investments, finance costs, taxation, non-recurring

costs and costs of returning capital to shareholders, expressed

as a percentage of the average net asset value during the period.

2023 2022

Investment management fee (£’000) 53 140

Investment management fee – FoF LP (£’000) 45 85

Other expenses (£’000) 370 379

Limited partnership ongoing expenses (£’000) 239 328

Ongoing charges (£’000) 707 932

Ongoing charges as a percentage of

average net assets: 2.1% 1.4%

Average net assets (£’000) 34,189 67,276

Premium/Discount

The amount by which the market price per share of an

investment company is either higher (premium) or lower

(discount) than the NAV per share, expressed as a percentage of

the NAV per share.

2023 2022

Net Asset Value per share (pence) (a) 624.8 627.1

Ordinary share price per share (pence) (b) 510.5 509.0

Discount (c=(b-a)/a) (c) 18.3% 18.8%

Secondary transaction

The purchase or sale of an investment and its undrawn

commitment (if any) to a fund or collection of fund interests in the

market.

Share buy-back transaction

The repurchase by the Company of its own shares which will

reduce the number of shares on the market.

Share price total return

The share price total return is calculated by adding dividends

and capital returned in the period to the increase or decrease in

the share price. The dividends or capital returned are assumed to

be re-invested on the day the share price goes ex-dividend.

2023 2022

Share price per share at start of year (pence) 509.0 473.0

Share price per share at end of year (pence) 510.5 509.0

Change in year +0.3% +7.6%

Impact of dividend reinvestments +6.5% +10.9%

Total share price return for the year +6.8% +18.5%

See page 14 for details of the Company’s key performance

indicators (“KPI’s”) and how the Directors assess some of these

Alternative Performance Measures.

Dunedin is required to make certain periodic disclosures to

investors in accordance with the Alternative Investment Fund

Managers Directive (“AIFMD”). Those disclosures that are

required to be made pre-investment are included within a pre-

investment disclosure document (“PIDD”) which can be found on

the www.dunedinenterprise.com. There have been no material

changes to the disclosures contained within the PIDD since first

publication on 6 March 2017.

The periodic disclosures as required under the AIFMD to

investors are made below:

• None of the Company’s assets are subject to special

arrangements arising from their illiquid nature;

• There are no new arrangements for managing the liquidity

of the Company or any material changes to the liquidity risk

management systems of Dunedin;

• The current risk profile of the Company and the risk

management systems employed by Dunedin to manage

those risks are found in the PIDD. The risk limits set by

Dunedin have not been exceeded; and

• In accordance with the requirements of AIFMD, Dunedin has

put in place a compliant remuneration policy, which is

available from the Company Secretary on request. The

Company Secretary can be contacted at Dunedin LLP, Easter

Dalry House, 3 Distillery Lane, Edinburgh, EH11 2BD. All

remuneration disclosures required will be included in the

annual report of Dunedin for the year ending 31 March 2024.

The table below sets out the current maximum permitted limit

and actual level of leverage for the Company.

Gross Commitment

Method Method

Maximum level of leverage 1.2:1 1.2:1

Actual level as at 31 December 2023 1:1 1:1

There have been no breaches of the maximum level during the

period and no changes to the maximum level of leverage

employed by the Company. There is no right of re-use of

collateral or any guarantees granted under the leveraging

arrangement.

Changes to the information required to be disclosed to investors

under AIFMD will be notified via a regulatory news service

without undue delay.

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

AIFMD Disclosures (unaudited)

Dunedin Enterprise Investment Trust PLC

Annual Report and Accounts 2023

Financial Calendar and Corporate Information

Announcements, dividend payments and the issue of the annual

and interim reports for the year ended 31 December 2023 and

half year end 30 June 2024 can be expected in the months

shown below:

March

Year end results and final dividend for the year announced.

April

Report and accounts published.

May

Annual General Meeting held and payment of final dividend.

September

Interim report for half year to 30 June published.

A preliminary announcement of unaudited net asset value for

each quarter will be made around one month following the

quarter end.

Directors

Duncan Budge, Chairman

(duncan.budge@dunedinenterprise.com)

Brian Finlayson

Angela Lane

Website

www.dunedinenterprise.com

Email info@dunedinenterprise.com

Manager, Secretary & Registered Office

Dunedin LLP

Easter Dalry House

3 Distillery Lane

Edinburgh EH11 2BD

Email info@dunedin.com

Website www.dunedin.com

Registered No. SCO52844

Registrar

Equiniti

Aspect House

Spencer Road

Lancing

West Sussex BN99 6DA

Tel 0371 384 2440

Bankers

Lloyds TSB Bank plc

Solicitors

Dickson Minto WS

Auditor

Johnston Carmichael LLP

Financial Calendar Corporate Information

www.dunedinenterprise . c om

Easter Dalry House

3 Distillery Lane

Edinburgh

EH11 2BD