Annual Financial Report

Annual Financial Report

NEW CENTURY AIM VCT PLC

New Century AIM VCT plc	Â	Â	29th February 2012
Report and Accounts for the year to 29th February 2012

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Financial Summary	Â	Â	Â	1
Investment Objective				1
Chairman's Statement				2
Details of Directors				3
Management and Administration				4
Directors				5
Investment Manager’s Review				6
Investment Portfolio				7
Top Ten Investments				11
Directors' Report				12
Directors’ Remuneration Report				15
Corporate Governance				17
Independent Auditors' Report				20
Income Statement				22
Balance Sheet				23
Cash Flow Statement				24
Notes to the Financial Statements				25
Shareholder Information				34
Notice of Annual General Meeting				35

Financial Summary

Â	Â	Year ended 29 February 2012	Â	Year ended 28 February 2011
Revenue return per share (pence) for the year		0.40		0.19
Total return per share (pence) for the year		-2.27		0.36
Proposed dividends per share (pence)		0.40		0.18
Net asset value per share (pence)		57.53		60.53
Cumulative value of shareholder investment (net asset value plus cumulative dividends per share) (pence)		  62.55		  65.37
Shareholders’ funds (£’000)		6,164		6,316

Investment Objective

New Century AIM VCT PLC is a Venture Capital Trust (“VCT”) established under the legislation introduced in the Finance Act 1995. The company’s principal objectives as set out in the prospectus are to achieve long term capital growth through investment in a diversified portfolio of Qualifying Companies primarily quoted on AIM.

Chairman's Statement

In the year to 29th February, 2012, the net asset value of your fund declined by 4.3% to 62.55p per share, which although disappointing, was better than the 11.2% decline in the FTSE AIM Index over the same period.

Qualifying investments, at 78.34% of the overall fund by cost, are still well in excess of the 70% requirement under VCT legislation.

We are aware that many of the shareholders would welcome higher dividends and with this in mind, we have been endeavouring to increase the income of the fund, particularly from the non qualifying investments where we have been increasing exposure to higher yielding, larger market capitalisation stocks. I am pleased to say that this has resulted in the fund’s revenue increasing from £71,000 to £94,000. As a result, the revenue returns per ordinary share have recovered from 0.19p per share to 0.4p per share. This has also enabled us to propose a dividend of 0.4p per share against 0.18p per share in the previous year. We propose to pay this dividend to shareholders on the register as at 17th August, 2012 with an ex dividend date of 15th August, 2012 and payment date of 14th September, 2012.

With a view to enabling the company to carry out buybacks, which will make it easier to sell shares of the VCT, we are proposing to go to Court to reorganise the share capital.

We remain in uncertain times, with constant worries over many of the economies of many of the Euro zone countries. We are therefore taking a cautious stance towards investment, by building up a more widespread portfolio of smaller holdings and by giving a greater prominence to more established, profitable companies.

I would like to thank the investment managers for their work in outperforming the AIM Index over the past year, and to my co directors, who have continued to work for the company without payment.

Annual General Meeting

The AGM will be held at 11.30am on 30th August, 2012 at 17-21 New Century Road, Laindon, Essex, SS15 6AG. I look forward to welcoming those shareholders who are able to attend.

Geoffrey Charles Gamble

Chairman

26 June 2012

Details of Directors

Michael Barnard (Aged 61)

Michael has been employed in stockbroking since 1971. In 1974 he became a Member of the Stock Exchange. During his career his duties have spanned investment advising, investment research, dealing and company management. In 1988 he started his own stockbroking company, M D Barnard. Based in Laindon, Essex, it has offices in London, Wells, Exeter and Colchester. Since 1995, he has been either managing or advising unit trust, private client and pension company portfolios with a total value of approximately £115 million.

Geoffrey Gamble (Aged 52)

Geoffrey started his career with National Westminster Bank plc. He joined Publishing Holdings plc in 1984 and became a director in 1986. He took part in an MBO in 1988, backed by Schroder Ventures (now Permira) to form Charterhouse Communications Group Ltd and was instrumental in the satisfactory venture capital exit from that company and its flotation on AIM in 1996. He became managing director of Charterhouse Communications plc in 1999.

Peter William Riley (Aged 66)

Peter qualified as a solicitor in 1969 and in that year became partner of Mitchells, Solicitors. In 1977, he became a partner in his present solicitor practice, Daybells, where he specialises in property law with an emphasis on large commercial properties.

Ian Cameron-Mowat (Aged 61)

Ian has a BSC 1st degree in electronics and was involved in the early development of computers at Burroughs Machines. He is currently a consultant radiologist to the NHS Trust.

Management and Administration

Registered Office & Registered Number	Â	Â	4th Floor, 150-152 Fenchurch Street London EC3M 6BB   5352611
Company Secretary			Graham Urquhart 4th Floor, 150-152 Fenchurch Street London EC3M 6BB
Registrar			Neville Registrars Limited Neville House 18 Laurel Lane Halesowen West Midlands B63 3DA
Solicitors			Dundas & Wilson 5th Floor, Northwest Wing Bush House Aldwych London WC2B 4EZ
Investment Manager and Broker			M D Barnard & Company Limited 17-21 New Century Road Laindon, Essex SS15 6AG
Auditor & VCT Status Adviser			UHY Hacker Young LLP Quadrant House 4 Thomas More Square London E1W 1YW
Bankers			Bank of Scotland New Uberior House 11 Earl Grey Street Edinburgh EH3 9BN

Directors

Geoffrey Gamble (Chairman)
Michael David Barnard
Peter William Riley
Ian Cameron-Mowat

All directors are non-executive.

Audit Committee:

Geoffrey Gamble (Chairman)
Peter William Riley
Ian Cameron-Mowat

Investment Manager’s Review

During the year, your fund realised net profits of over £71,000 on disposal of investments, despite taking losses on some of the investments where the prospects had diminished. We benefited from the takeover of Educational Developments and A H Medical and also realised some of our profits on Cupid and Alliance Pharmaceutical.

Sadly, Western and Oriental, Sports Media and Environ all went into receivership or administration which accounted for losses of just over £176,000 during the year. On a positive front, the shares of Lombard Risk Management and Cupid both more than doubled in value while those of Belgravium and Bango rose by more than 60% and HML and Advanced Computer by more than 40%.

Overall, including realised net profits and unrealised net losses, the fund decreased in value by just over £238,000.

Since the February year end, the AIM market has continued to drift, having fallen by 18.3%. Relative to this, your fund has outperformed, with a decline in net asset value of 11.1% to 55.6p per share.

Michael Barnard

26 June, 2012

Investment Portfolio

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		£		29/02/2012 - £		Cost		Valuation
Qualifying Investments		9,612,331		4,198,029		78.34		67.82
Non-qualifying Investments		2,543,293		1,876,652		20.73		30.32
		12,155,625		6,074,682		99.06		98.14
Uninvested funds		114,958		114,958		0.94		1.86
		12,270,583		6,189,640		100.00		100.00
Qualifying Investments
AIM quoted
Tristel plc		245,871		226,764		2.00		3.66
PHSC plc		182,910		52,500		1.49		0.85
DCD Media plc		522,600		44,000		4.26		0.71
Legion Group plc		175,874		-		1.43		0.00
K3 Business Technology Group		140,197		237,150		1.14		3.83
Belgravium Technologies		281,400		150,000		2.29		2.42
ILX Group		753,750		175,000		6.14		2.83
Lighthouse Group plc		203,513		86,250		1.66		1.39
AT Communications Group		422,100		-		3.44		0.00
Invocas Group plc		100,400		8,100		0.82		0.13
Jelf Group plc		157,132		104,725		1.28		1.69
Relax Group		135,675		-		1.11		0.00
Brulines (Hldgs) plc		40,175		28,600		0.33		0.46
HML Holdings plc		351,549		173,600		2.86		2.80
Sinclair Pharma		211,050		173,299		1.72		2.80
Western & Oriental plc		502,500		-		4.10		0.00
EBTM plc		640,888		-		5.22		0.00
Sport Media Group		125,625		-		1.02		0.00
Environ Group plc		704,900		-		5.74		0.00
Kurawood plc		150,750		-		1.23		0.00
Boomerang Plus plc		238,185		78,000		1.94		1.26
Fishworks plc		180,900		-		1.47		0.00
Optare plc		50,753		538		0.41		0.01
Advanced Computer Software		341,700		1,010,000		2.78		16.32
Cyan Holdings plc		211,041		139,326		1.72		2.25
Marechale Capital plc		202,005		30,000		1.65		0.48
Lombard Risk Mgt		24,120		63,000		0.20		1.02
Savile Group		126,254		22,500		1.03		0.36
Winkworth plc		72,360		74,700		0.59		1.21
Green Compliance plc		100,627		40,250		0.82		0.65
Bango plc		43,215		171,000		0.35		2.76
Cupid plc		155,272		556,200		1.27		8.99
Managed Support Group		70,350		6,500		0.57		0.11
Eco City Vehicles		76,683		28,110		0.62		0.45
Corac Group plc		109,278		86,980		0.89		1.41
Brady plc		41,805		57810		0.34		0.93
Angel Biotech		133,384		96,471		1.09		1.56
In-Deed Online		133,812		120,460		1.09		1.95
Music Festivals plc		68,089		54,196		0.55		0.88
		8,428,692		4,096,029		68.69		66.18
Plus Markets quoted
CKS Group plc		526,369		-		4.29		0.00
Air Touring		201,000		-		1.64		0.00
General Medical Clinics plc		205,020		102,000		1.67		1.65
		932,389		102,000		7.60		1.65
Unlisted Investments
Air Touring Group plc		251,250		-		2.05		0.00
		251,250		-		2.05		0.00
		Â		Â		Â		Â
Total qualifying investments		9,612,331		4,198,029		78.34		67.82

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		£		29/02/2012 - £		Cost		Valuation
Non-qualifying Investments
AIM quoted
Arbuthnot Banking Group		45,207		40,375		0.37		0.65
Commodity Growth plc		150,750		37,500		1.23		0.61
DCD Media plc		40,200		2,750		0.33		0.04
Impact Holdings (UK) plc		26,160		2,250		0.21		0.04
STM Group plc		54,738		22,230		0.45		0.36
NetDimensions Ltd		31,155		12,250		0.25		0.20
Ashley House plc		116,975		12,000		0.95		0.19
Sanderson Group		92,521		92,500		0.75		1.49
Eco City Vehicles		62,116		21,000		0.51		0.34
Pactolus Hungarian Prop.		49,749		19,500		0.41		0.32
Burford Capital		25,250		34,125		0.21		0.55
Rotala plc		70,008		77,462		0.57		1.25
Motivcom		25,470		30,030		0.21		0.49
First Derivatives plc		19,797		33,250		0.16		0.54
Tristel plc		60		36		0.00		0.00
K3 Business Technology		131		153		0.00		0.00
Bango plc		291		342		0.00		0.00
Interior Services		9,393		6,000		0.08		0.10
China Food Co plc		46,220		36,225		0.38		0.59
Hansard Global plc		24,727		22,200		0.20		0.36
2Ergo Group		37,879		27,302		0.31		0.44
Bezant Resources plc		15,078		8,475		0.12		0.14
Merchant House		45,228		31,050		0.37		0.50
Geong International		9,802		4,438		0.08		0.07
Spectra Systems		24,886		19,728		0.20		0.32
Networkers International		25,014		27,300		0.20		0.44
Microsaic Systems		31,516		39,600		0.26		0.64
Merchant House		18,095		13,650		0.15		0.22
Inspired Energy		80,403		100,000		0.66		1.62
Renew Holdings		20,764		22,500		0.17		0.36
Numis Corp		7,881		9750		0.06		0.16
Randall & Quilter		29,395		30,600		0.24		0.49
Hightex		21,676		28,275		0.18		0.46
Nature Group		26,636		27,500		0.22		0.44
Stadium Group		18,760		21,000		0.15		0.34
Top Level Domain		29,525		31,155		0.24		0.50
Probability plc		14,952		14,600		0.12		0.24
Quindell Portfolio		40,706		39,000		0.33		0.63
		Â		Â		Â		Â
		1,389,114		998,101		11.32		16.13

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		£		29/02/2012 - £		Cost		Valuation
									Â
Premier Farnell		44,542		43,500		0.36		0.7
Diploma plc		35,927		79,400		0.29		1.28
4Imprint Group		30,806		47,600		0.25		0.77
Tesco plc		25,625		20,540		0.21		0.33
British American Tobacco		44,189		63,540		0.36		1.03
Astrazeneca		61,213		56,150		0.5		0.91
G4S plc		19,464		21,690		0.16		0.35
Greggs plc		30,775		32,820		0.25		0.53
Aviva plc		22,268		18,415		0.18		0.3
Chemring Group		39,379		26280		0.32		0.42
Cineworld		32,799		31,200		0.27		0.5
HSBC		21,955		19,435		0.18		0.31
KCOM Group		25,983		24,325		0.21		0.39
Tullett Prebon		18,010		32,070		0.15		0.52
TT Electronics		24,596		27,375		0.2		0.44
William Hill		24,677		22,450		0.2		0.36
Vodafone		17,174		17,000		0.14		0.27
BP		22,426		24,600		0.18		0.4
Sportingbet		15,904		19,000		0.13		0.31
Imperial Tobacco		23,763		24,910		0.19		0.4
		Â		Â		Â		Â
		1,058,702		822,301		8.63		13.29
									Â
Unlisted Investments
Environ plc		50,250		-		0.41		0
Merchant House		45,228		56,250		0.37		0.91
		95,478		56,250		0.78		0.91
		Â		Â		Â		Â
Total non-qualifying investments		2,543,293		1,876,652		20.73		30.32

Top Ten Investments

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		£		29/02/2012 - £		Cost		Valuation
									Â
Advanced Computer Software		341,700		1,010,000		2.78		16.32
Cupid plc		155,273		556,200		1.27		8.99
K3 Business Technology Group		140,198		237,150		1.14		3.83
									Â
Tristel plc		245,872		226,764		2.00		3.66
									Â
ILX Group		753,750		175,000		6.14		2.83
									Â
HML Holdings		351,549		173,600		2.86		2.80
									Â
Sinclair Pharma		211,050		173,299		1.72		2.80
									Â
Belgravium Technologies		281,400		150,000		2.29		2.42
									Â
Bango plc		43,215		171,000		0.35		2.76
									Â
Investec		477,227		170,000		3.89		2.75

The investments tabulated above are expressed as a percentage of the company’s investment portfolio including uninvested cash.

Director's Report

The directors present their report and the audited financial statements for the year to 29 February 2012.

Activities and status

The principal activity of the company during the period was the making of long-term equity and loan investments in unquoted and AIM traded companies in the United Kingdom. The company has been listed on the London Stock Exchange since 25 March 2005. The Chairman’s Statement on page 2 and the Investment Manager’s Review on page 6 give a review of developments during the year and of future prospects.

The directors consider that the company was not at any time up to the date of this report a close company within the meaning of Section 414 of the Act.

Principal risks and uncertainties

The company invests its funds primarily in unlisted companies and companies traded on AIM, which entail a higher degree of risk than investments in large listed companies. The main risk, therefore, arising from the company’s activities is market price risk, representing the uncertain realisable values of the company’s investments. Please refer to note 19 to these accounts which gives a detailed review of the company’s risk management.

Results and dividend

	Â	Year to 29 February 2012			Â	Year to 28 February 2011
		Revenue	Â	Capital		Revenue	Â	Capital
		£’000		£’000		£’000		£’000
Return on ordinary activities after taxation		43		(287)		20		17
		Â		Â		Â		Â
Appropriated as follows:
									Â
Interim dividend paid
									Â
Revenue – nil p		-		-		-		-
									Â
Capital – nil p		-		-		-		-
									Â
Final dividend paid in respect of prior period
Revenue – 0.18p (0.55p) per share		(19)		-		(58)		-
Capital – nil p per share		-		-		-		-
									Â
		Â		Â		Â		Â
Transfers to reserves		24		(287)		(38)		17

The directors propose a final dividend of 0.4p per share for the year ended 29 February 2012 to be paid on 14 September 2012 to shareholders on the register at 17 August 2012.

Director's Report

Directors

The directors of the company who served throughout the year and their interests in the issued ordinary shares of 10p of the company are as follows:

	Â	Year ended 29 February 2012	Â	Year ended 28 February 2011
  Michael David Barnard Geoffrey Gamble   Peter William Riley Ian Cameron-Mowat		  2,746,963 33,000   43,000 111,549		  2,746,963 115,000   43,000 87,123

All of the directors’ share interests shown above are held beneficially.

Brief biographical notes on the directors are given on page 3. The director, retiring in accordance with the Company’s Articles of Association, is Mr Gamble, who being eligible will offer himself for re-election at the forthcoming annual general meeting. The directors believe his experience in small companies is a great benefit to the Board and recommend his re-election.

None of the directors has a contract of service with the company and, except as mentioned below under the heading “Management”, there were no contracts that subsisted during the year in which a director was materially interested and which was significant in relation to the company’s business.

Management

M D Barnard & Co. Limited has acted as investment manager to the company since inception. The principal terms of the Investment Management Agreement are set out in Note 3 to the Financial Statements.

VCT status monitoring

The company has engaged UHY Hacker Young LLP to advise it on compliance with the VCT legislation. UHY Hacker Young LLP reviews the company’s investment portfolio to monitor ongoing VCT compliance. UHY Hacker Young LLP works closely with the investment manager, but reports directly to the Board of the company.

Director's Report

Substantial shareholdings

As at 26 June 2012 the company had been notified of the following shareholdings representing 3 per cent or more of the company’s issued share capital during the year under review or at the date of this report:

	Â	Number	Â	Percentage of share capital
Michael Barnard John Brice Peter Steyne David Trotman Nigel Shanks		2,746,963 400,000 400,000 400,000 394,553		25.6% 3.7% 3.7% 3.7% 3.7%

Creditor payment policy

The company’s payment policy is to agree terms of payment before business is transacted and to settle accounts in accordance with those terms. The company’s principal expenses such as investment management fees and administration fees are paid quarterly in arrears in accordance with the respective agreements. Accordingly the company had no material trade creditors at the year end.

Annual general meeting

Notice of the annual general meeting is set out on pages 35 and 36.

Auditors

In accordance with Section 485 of the Companies Act 2006, a resolution proposing that UHY Hacker Young LLP be reappointed as auditors of the Company and that the Directors be authorised to determine their remuneration will be put to the next Annual General Meeting.

By Order of the Board

Michael Barnard

Â

26 June 2012

Directors’ remuneration Report

The Board has prepared this report in accordance with the requirements of the Companies Act 2006. A resolution to approve this report will be put to the members at the Annual General Meeting to be held on 30 Augist 2012.

Directors’ remuneration policy

The company does not have any executive directors and, as permitted under the Listing Rules, has not, therefore, established a remuneration committee. Directors do not receive any remuneration or fees.

The directors shall be paid by the company all travel, hotel and other expenses they may incur in attending meetings of the directors or general meetings or otherwise in connection with the discharge of their duties. Any director who, by request of the directors, performs special services may be paid such extra remuneration as the directors may determine.

Directors’ remuneration (audited)

None of the Directors received any remuneration from the company during the year under review.

No other emoluments or pension contributions were paid by the company to, or on behalf of, any director. None of the directors has a service contract with the company. It is expected that the directors will continue not to receive any remuneration for their services in the forthcoming years.

Performance

The directors consider that the most appropriate measure of the company’s performance is its Cumulative Value of Shareholder Investment (net asset value plus cumulative dividends). The company’s Cumulative Value of Shareholder Investment at 29 February 2012 and 28 February 2011 are set out in the Financial Summary on page 1.

Total shareholder return

[graphic omitted ]

By Order of the Board

Michael Barnard

Corporate Governance

The directors support the relevant principles of the UK Corporate Governance Code issued in June 2010 by the Financial Reporting Council, being the principles of good governance and the code of best practice as set out in the Main Principles of the Code annexed to the Listing Rules of the Financial Services Authority.

Bearing in mind that the assets of the company consist mainly of marketable securities, the directors are of the opinion that at the time of approving the financial statements, the company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

The Board

The company is led and controlled by a Board of directors who are all non-executives. The Chairman is Geoffrey Gamble. Biographical details of all Board members are shown on page 3.

One third of the Directors are subject to re-election at each AGM by rotation.

During the year the following were held:

5 full board meetings	Â	2 Audit Committee meetings
All directors attended all meetings with the exception of Mr Cameron-Mowat on four occasions and Mr Riley on three occasions.		All members attended with the exception of Mr Cameron-Mowat on one occasion.

Whilst only Mr Gamble had been a director of a quoted company, all directors had relevant experience with quoted companies prior to their appointment and it was therefore not thought necessary to provide further training in respect of their obligations and duties.

The Board has also established procedures whereby directors wishing to do so in the furtherance of their duties may take independent professional advice at the company’s expense.

All directors have access to the advice and services of the Company Secretary. The Company Secretary provides the Board with full information on the company’s assets and liabilities and other relevant information requested by the Chairman, in advance of each Board meeting.

The Board believes that it presents a balanced and understandable assessment of the company’s position and prospects. The Audit Committee meets at least once a year. Under the chairmanship of a non-executive director, its membership comprises all the non-executive directors with the exception of the representative of the investment manager. During the year the Audit Committee was chaired by Mr Gamble. The Audit Committee reviews the financial statements and is reported to by the external auditors. Further, the Audit Committee keeps under review the cost effectiveness, independence and objectivity of the auditors. A formal statement of independence is received from the external auditors each year. The terms of reference of the audit committee are available for inspection at the company’s registered office.

During the year Messrs UHY Hacker Young LLP continued to act as auditors, and as part of their audit process reviewed the internal financial controls including those of the investment manager necessary for the expression of their audit opinion.

The investment manager is authorised and regulated by the Financial Services Authority and the directors have an opportunity to review their own auditors’ review of their financial controls.

Relations with shareholders

The Chairman is the company’s principal spokesman with investors, fund managers, the press and other interested parties.

Shareholders will have the opportunity to meet the Board at the AGM. The Board is also happy to respond to any written queries made by shareholders during the course of the year, or to meet with major shareholders if so requested.

In addition to the formal business of the AGM, representatives of the management team and the Board are available to answer any shareholder queries.

Separate resolutions are proposed at the AGM on each substantially separate issue. The Registrars collate proxy votes and the results (together with the proxy forms) are forwarded to the Company Secretary immediately prior to the AGM. In order to comply with the Governance Code, proxy votes will be announced at the AGM, following each vote on a show of hands, except in the event of a poll being called. The notice of the next AGM and proxy form can be found at the end of these financial statements.

Financial Reporting

The directors’ statement of responsibilities for preparing the accounts is set out on page 19, and a statement by the auditors about their reporting responsibilities is set out in the Auditors’ Report on page 20.

Internal control

The directors are responsible for the company’s system of internal control. Although no system of internal control can provide absolute assurance against material misstatement or loss, the company’s systems are designed to provide the directors with reasonable assurance that problems are identified on a timely basis and dealt with appropriately.

The directors have conducted a review of the effectiveness of the system of internal control for the year covered by the financial statements. This accords with the Turnbull guidance.

Although the Board is ultimately responsible for safeguarding the assets of the company, the Board has delegated, through written agreements, the day-to-day operation of the company to M D Barnard & Co. Limited.

Corporate Governance

Compliance statement

The Listing Rules require the Board to report on compliance with the fifty-two Governance Code provisions throughout the accounting year. The Comply or Explain Section of the Governance Code does however acknowledge that some provisions may have less relevance for investment companies. With the exception of the limited items outlined below, the Company has complied throughout the accounting year to 29 February 2012 with the provisions set out in Sections A to E of the Governance Code.

1. The Board has not appointed a nominations committee as they consider the Board to be small and it comprises wholly non-executive directors. Appointments of new directors are dealt with by the full Board.

2. New directors do not receive a full, formal and tailored induction on joining the Board. Such matters are addressed on an individual basis as they arise.

3. Due to the size of the Board and the nature of the company’s business, a formal performance evaluation of the Board, its committees, the individual directors and the Chairman has not been undertaken. Specific performance issues are dealt with as they arise.

4. The company has three independent directors, as defined by the Governance Code issued in June 2010. The board consider that Messrs. Gamble, Riley and Cameron-Mowat are independent in character and judgement and there are no relationships or circumstances which are likely to affect, or could appear to affect the directors’ judgement. The Board considers that all directors have sufficient experience to be able to exercise proper judgement within the meaning of the Governance Code.

5. The company does not have a chief executive officer or senior independent director. The Board does not consider this to be necessary for the size of the company.

6. The company does not conduct a formal review as to whether there is a need for an internal audit function. The directors do not consider that an internal audit would be an appropriate control for a venture capital trust.

7. The Audit Committee is chaired by John Geoffrey Gamble, Chairman of the Board of directors, whom the board regard as independent despite recommendations to the contrary in the Governance Code due to his being Chairman of the Board of directors.

8. The non-executive directors do not have service contracts, whereas the recommendation is for fixed term renewable contracts.

9. The company has no major shareholders so shareholders are not given the opportunity to meet any new non-executive directors at a specific meeting other than the annual general meeting.

Statement of directors’ responsibilities

United Kingdom company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the company as at the end of the financial year and of the revenue of the company for that year. In preparing those financial statements, the directors are required to:

• select suitable accounting policies and apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for ensuring that proper accounting records are kept, which disclose with reasonable accuracy at any time the financial position of the company, enabling them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for the company’s system of internal control, for safeguarding the assets of the company and for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditors

So far as the directors are aware:

1. there is no relevant audit information of which the Company’s auditors are unaware; and

2. the directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information.

Independent Auditors’ Report to the members of New Century AIM VCT plc

We have audited the financial statements of New Century AIM VCT plc for the year ended 29 February 2012 which comprise the Income Statement, the Balance Sheet, the Cash Flow Statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

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 auditors’ 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.

Respective responsibilities of directors and auditors

As explained more fully in the Statement of Directors’ Responsibilities set out on page 19, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with Auditing Practices Board’s (APB’s) Ethical Standards for Auditors.

Scope of the audit of the financial statements

A description of the scope of an audit of financial statements is provided on the APB's web-site at www.frc.org.uk/apb/scope/private.cfm.

Opinion on financial statements

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 29 February 2012 and of the company's loss for the year then ended;
• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
• have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other 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; and
• the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following:

Under the Companies Act 2006 we are required 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
• the company financial statements and the part of the Directors' Remuneration Report to be audited are not in agreement with the accounting records and returns; or
• certain disclosures of directors' remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.

Under the Listing Rules we are required to review:

• the directors' statement, set out on page 17, in relation to going concern; and
• the part of the Corporate Governance Statement relating to the company's compliance with the nine provisions of the UK Corporate Governance Code specified for our review; and
• certain elements of the report to the shareholders by the Board on directors' remuneration.

Guy Swarbreck (Senior statutory auditor)

for and on behalf of UHY Hacker Young

Chartered Accountants

Statutory Auditors
UHY Hacker Young

June 2012

Quadrant House
4 Thomas More Square
London, E1W 1YW

Income Statement (incorporating the revenue account) for the year to 29 February 2012

	Â		Â	Year ended 29 February 2012					Â	Year ended 28 February 2011
		Notes		Revenue £’000	Â	Capital £’000	Â	Total £’000		Revenue £’000	Â	Capital £’000	Â	Total £’000
															Â
Gains/(losses) on investments
- realised				-		71		71		-		146		146
- unrealised				-		(310)		(310)		-		(82)		(82)
Income		2		94		-		94		71		-		71
Investment management fee		3		(15)		(48)		(63)		(15)		(47)		(62)
Other expenses		4		(36)		-		(36)		(36)		-		(36)
				________		________		________		________		________		________
Return on ordinary activities before taxation				43		(287)		(244)		20		17		37
Tax (charge)/credit on ordinary activities		6		-		-		-		-		-		-
				________		________		________		________		________		________
Return on ordinary activities after taxation		Â		43		(287)		(244)		20		17		37
				=======		=======		=======		=======		=======		=======
															Â
Return per ordinary share (pence)		8		0.40		(2.67)		(2.27)		0.19		0.16		0.35
				=======		=======		=======		=======		=======		=======

Income Statement (incorporating the revenue account)

for the year to 29 February 2012

The notes on pages 25 to 33 form an integral part of these financial statements.

All revenue and capital items in the above statement are from continuing operations in the current year. No operations were acquired or discontinued in the current year. Other than as shown above, the company had no recognised gains or losses. Accordingly no statement of total recognised gains and losses has been prepared.

Balance Sheet

at 29 February 2012

Â	Â	    Note	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
				Â	Â			Â	Â
Fixed assets
Investments		9				6,074				6,009
											Â
Current assets
Debtors		12				115				332
											Â
Current liabilities
Creditors: amounts falling due within one year		13				(25)				(25)
											Â
						Â				Â
						6,164				6,316
						Â				Â
Capital and reserves
Called up share capital		14				1,073				1,053
Share premium		15				9,003				8,912
Capital reserve – realised		15				2,144				2,241
Capital reserve – unrealised		15				(6,100)				(5,910)
Revenue reserve		15				44				20
											Â
											Â
						Â				Â
Total equity shareholders’ funds		16				6,164				6,316
											Â
Net asset value per ordinary share		17				57p				60p

The financial statements on pages 22 to 33 were approved by the Board of directors on 26 June 2012 and were signed on its behalf by:

Balance Sheet

at 29 February 2012

Michael Barnard

Director

The notes on pages 25 to 33 form an integral part of these financial statements.

Cash Flow Statement
for the year to 29 February 2012

	Â	Note	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
					Â				Â
Net cash outflow from operating activities		18				(99)				(96)
													Â
Returns on investments
Interest received				5				4
Investment income				89				67
						94				71
											Â
UK Corporation Tax paid						-						-
													Â
Dividend paid						(19)						(58)
													Â
Capital expenditure & financial investment
Sale of investments				1,033				1,009
Purchase of investments				(1,337)				(1,412)
Net cash outflow for capital expenditure						(304)						(403)
& financial investment
						Â						Â
Net cash outflow						(328)						(486)
Share issue						Â
Ordinary shares						111						484
						Â						Â
Decrease in uninvested funds with broker						(217)						(2)

The notes on pages 25 to 33 form an integral part of these financial statements.

Notes to the Financial Statements for the year to 29 February 2012

1. Accounting policies

General

The financial statements have been prepared in accordance with applicable United Kingdom law and United Kingdom Accounting Standards (UK Generally Accepted Accounting Practice) and the Statement of Recommended Practice “Financial Statements of Investment Trust Companies”. The accounts have been prepared under the historical cost convention, as modified to include the revaluation of fixed asset investments.

Investments

Listed, AIM or PLUS traded investments are stated at market value, which is based upon market bid prices at the balance sheet date. In the event that the shares held by the company are subject to certain restrictions, or the holding is significant in relation to the traded issued share capital of the investee company then the directors may apply a discount to the relevant market price.

Investments in unquoted companies are valued by the directors in accordance with British Venture Capital Association (“BVCA”) guidelines.

Realised surpluses or deficits on the disposal of investments and permanent impairments in the value of investments are taken to realised capital reserves. Unrealised surpluses and deficits on the revaluation of investments are taken to unrealised capital reserves. Costs incurred relating to acquisitions and disposals are charged to capital reserves as a deduction from proceeds or an addition to costs.

It is not the company’s policy to exercise controlling or significant influence over investee companies, although it may hold a significant interest in some companies. Accordingly, the results of these companies are not incorporated into the revenue account except to the extent of any income earned or received.

Income

Dividend income receivable from quoted securities is recognised on the ex-dividend date. Income from unquoted equity and non-equity securities is recognised on an accruals basis except that a full provision is made until the receipt of the income is certain.

Interest from cash and deposits and fixed returns on debt securities are recognised on an accruals basis.

Expenses

All expenses are accounted for on an accruals basis. One quarter of the investment management fee is charged to the revenue account and the remaining three quarters is charged to capital reserves, net of corporation tax relief, and inclusive of any irrecoverable value added tax. The allocation of the management fee reflects the directors’ estimate of the source of the long-term returns in the portfolio from revenue and capital.

Taxation

Deferred taxation is provided in full on timing differences that result in an obligation at the balance sheet date to pay more tax, or a right to pay less tax, at a future date, at rates expected to apply when they crystallise based on current tax rates and law. Timing differences arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in which they are included in the financial statements. Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered. Deferred tax assets and liabilities are not discounted

2. Income

	Â	Year ended			Â	Year ended
		29 February				28 February
		2012				2011
		£’000				£’000
		Â	Â			Â	Â
Interest receivable
- listed fixed interest securities				4				3
- bank deposits and liquid funds				1				1
									Â
				5				4
Dividends receivable				89				67
Investment income				94				71

3. Investment management fees

	Â	Year ended 29 February 2012			Â	Year ended 28 February 2011
		Revenue £’000	Â	Capital £’000		Revenue £’000	Â	Capital £’000
									Â
Investment management fees		15		48		15		47

MD Barnard & Company Limited (“MDB”) provides investment management services to the company in respect of the company’s portfolio of venture capital investments under an investment management agreement dated 10 March 2005. Michael Barnard who is a non-executive director of the company is managing director and proprietor of MDB.

Under the terms of the investment management agreement, MDB is entitled to a fee (exclusive of VAT) equal to 1% per annum of the net assets of the company. The fee is calculated quarterly in arrears based on the net assets at 28 February, 31 May, 31 August and 30 November. No performance fee is payable.

The investment management agreement is for a minimum period of three years from 24 March 2005 terminable by either party at any time thereafter by one year’s prior written notice.

4. Other expenses

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
		Â	Â			Â	Â
Auditors’ remuneration
- for audit services Â				9				9
- for tax services				5				6
									Â
				Â				Â
				14				15

5. Directors’ remuneration

No remuneration has been paid or is payable for year to 29 February 2012, this is also true for the prior year.

6. Tax charge/(credit) on ordinary activities

	Â	Year ended 29 February 2012			Â	Year ended 28 February 2011
		Revenue £’000	Â	Capital £’000		Revenue £’000	Â	Capital £’000
									Â
United Kingdom tax based on the taxable (loss)/ profit for the year		-		-		-		-
		Â		Â		Â		Â
Factors affecting tax charge for the year
									Â
Return on ordinary activities before taxation		43		(287)		20		17
		Â		Â		Â		Â
Tax on above at the small company rate of 20% (2011: 21%)		9		(57)		4		3
UK dividends not subject to corporation tax		(18)		-		(14)		-
Capital loss on investment		-		32		-		(61)
Non allowable expenses		-		-		-		-
Unutilised losses		9		25		10		58
Prior year adjustments		-		-		-		-
		Â		Â		Â		Â
Current tax charge/(credit) for the year		-		-		-		-

At the balance sheet date, the company has unused tax losses available for offset against suitable future gains. A deferred tax asset of £175,000 (2011: £140,000) has not been recognised in respect of such losses due to the unpredictability of suitable future gains.

7. Dividends

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
Interim dividend paid		Â	Â	-		Â	Â	-
Final dividend paid in respect of previous year				19				58
				Â				Â
				19				58

The directors propose a final dividend of 0.4p per share for the year ended 29 February 2012 to be paid on 14 September 2012 to shareholders on the register at 17 August 2012.

8. Return per ordinary share

The revenue return, per ordinary share, is based on the net revenue on ordinary activities after taxation of £43,222 (2011: £20,053) and on 10,715,949 (2011: 10,434,260) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

The capital return per ordinary share is based on a net realised and unrealised capital loss of £286,150 (2011: profit £17,083) and on 10,715,949 (2011: 10,434,260) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

9. Fixed asset investments

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
		Â	Â			Â	Â
UK Listed				822				521
AIM				5,094				5,182
PLUS Markets				102				174
Unlisted				56				132
				Â				Â
				6,074				6,009

Movements in investments, including realised and unrealised gains and losses, during the year are summarised as follows:

	Â		Â	Year ended 28 February 2011
		Unlisted		UK listed	Â	AIM	Â	Plus Mkts	Â	Total
		£'000		£'000		£'000		£'000		£'000
Valuation at 1 March 2010		368		241		4,676		257		5,542
Purchases at cost		-		198		1,214		-		1,412
Sales proceeds		(8)		-		(1,001)		-		(1,009)
Realised gains/(losses)		8		-		138		-		146
Unrealised gains/(losses)		(236)		83		154		(83)		(82)
Valuation at 28 February 2011		132		522		5,181		174		6,009
											Â
Cost at 1 March 2010		402		599		9,384		950		11,335
Purchases		-		198		1,214		-		1,412
Sales proceeds		(8)		-		(1,001)		-		(1,009)
Realised gains/(losses)		8		Â		155		-		163
Cost at 28 February 2011		402		797		9,752		950		11,901

Â		Â		Year ended 29 February 2012
	Â		Unlisted		Â	UK listed	Â	AIM	Â	Plus Mkts	Â	Total
			£’000			£'000		£'000		£'000		£'000
Valuation at 1 March 2011			132			522		5,181		174		6,009
Purchases at cost			45			367		925		-		1,337
Sales proceeds			(60)			(39)		(904)		(30)		(1,033)
Realised gains/(losses)			(37)			(4)		112		-		71
Unrealised gains/(losses)			(24)			(24)		(220)		(42)		(310)
Valuation at 29 February 2012			56			822		5,094		102		6,074
													Â
Cost at 1 March 2011			402			797		9,752		950		11,901
Purchases			45			367		925		-		1,337
Sales proceeds			(60)			(39)		(904)		(30)		(1,033)
Realised gains/(losses)			(41)			(66)		45		12		(50)
Cost at 29 February 2012			346			1,059		9,818		932		12,155

The overall gain on investments for the years shown are in the Income Statement is analysed as follows:

	Â	Year ended 29 February 2012 £’000		Year ended 28 February 2011 £’000
Net realised gain on disposal		Â	72	Â	146
Decrease in unrealised appreciation			(310)		(82)
			Â		Â
			(238)		64

10. Venture capital investments

A full list of investments held is disclosed under Investment Portfolio.

11. Significant interests

The Company did not hold more than 10% of the allotted equity share capital of any class of any investee company.

12. Debtors

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
Uninvested funds with broker:		Â	Â			Â	Â
MD Barnard & Co Ltd				115				332

13. Creditors: amounts falling due within one year

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
Trade creditors and accruals		Â	Â	25		Â	Â	25
UK Corporation Tax				-				-
				Â				Â
				25				25

14. Share capital

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
		Â	Â			Â	Â
Authorised
15,000,000 ordinary shares of 10p each				1,500				1,500
				Â				Â
Allotted, called up and fully paid
10,734,329 (10,534,329) ordinary shares of 10p				1,073				1,053

On 18 March 2011, the company issued 32,834 ordinary 10p shares fully paid for 60.91p each; on 01 April 2011, 130,272 ordinary 10p shares fully paid for 61.41p each; on 13 April 2011 24,150 ordinary 10p shares fully paid for 62.11 p each and on 10 May 2011, 12,744 ordinary 10p shares fully paid for 62.04p each.

15. Reserves

	Â	Share Premium account	Â	Capital realised	Â	Capital unrealised	Â	Revenue reserve
		£’000		£’000		£’000		£’000
As at 1 March 2011		8,912		2,241		(5,910)		20
Share issue		91		-		-		-
Realised gains on disposals		-		71		-		-
Unrealised losses		-		-		(310)		-
Net revenue		-		-		-		43
Investment management fee		-		(48)		-		-
Corporate taxation		-		-		-		-
Dividends paid		-		-		-		(19)
Transfer of unrealised gains/(losses) to Capital
realised reserve on investment disposal		-		(120)		120		-
At 29 February 2012		9,003		2,144		(6,100)		44

16. Reconciliation of movements in shareholders’ funds

	Â	Â	Â	Â	Â	£’000
At 1 March 2011						6,316
Share issue						111
Return on ordinary activities after tax						(244)
Dividend paid						(19)
At 29 February 2012						6,164

17. Net asset value per share

Net asset value per share is based on net assets at 29 February 2012 of £6,164,627 (28 February 2011 of £6,315,988) divided by the 10,715,949 and 10,434,260 weighted average ordinary shares in issue at those dates respectively.

18. Net cash outflow from operating activities

	Â	Year ended 29 February 2012 £’000	Â	Year ended 28 February 2011 £’000
Operating activity
Operating (loss)/ profit		(244)		37
Gain on sale of investments		(71)		(146)
Investment income		(94)		(70)
Unrealised losses on investments		310		82
Increase in creditors		-		1
		________		________
		(99)		(96)
		=======		=======

19. Risk management and financial instruments

A statement of the company’s principal objectives is given on page 1. In order to achieve these objectives the company invests its funds primarily in qualifying holdings in unlisted companies and companies traded on AIM, which by their nature may entail a higher degree of risk than investments in large listed companies. The company has not entered into any derivative transactions, and does not expect to do so in the foreseeable future. As a Venture Capital Trust, the company invests in securities for the long term, and it is the company’s policy that no trading in investments or other financial instruments shall be undertaken.

Market price risk

The main risks arising from the company’s investing activities are market price risk, representing the uncertain realisable values of the company’s investments. The directors aim to limit the risk attaching to the portfolio as a whole by careful selection of investments and by maintaining a wide spread of investments in terms of financing stage, industry sector and geographical location.

Interest rate risk

The company finances its activities through retained profits including realisable capital profits, and through the issue of equity shares. It has not entered into any borrowings. The company’s investment portfolio includes investments in interest bearing securities in investee companies and in other fixed interest securities. Details of interest bearing assets are given below under Financial assets.

Liquidity risk

There is liquidity risk associated with unquoted investments, which are not readily realisable.

Credit risk

Credit risk is the risk of a borrower defaulting on either an interest payment or the capital sum of a loan. The exposure is limited to uninvested funds held with the investment manager and the fixed interest loan notes.

Currency risk

The company’s assets and liabilities are denominated in sterling.

Financial assets

The interest rate profile of the company’s financial assets is set out below:

	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
		Â	Â			Â	Â
Floating rate				115				332
Fixed rate				56				132
Non-interest bearing				6,018				5,877
				Â				Â
				6,189				6,341

Fixed rate assets	Â	Year ended 29 February 2012 £’000			Â	Year ended 28 February 2011 £’000
		Â	Â			Â	Â
Weighted average interest rate				15%				8%
Weighted average years to maturity				5.8				5.8

Floating rate financial assets comprise cash held on deposit and investments in liquidity funds. The benchmark rate for these investments is the UK bank base rate.

Non-interest bearing financial assets comprises equity share and non-equity share investments in investee companies, cash held on non-interest bearing deposit and debtors.

Fair values

The investments of the company are valued by the directors in accordance with the guidelines issued by the British Venture Capital Association, and the carrying values are considered to approximate the fair value of the investments.

20. Related party transactions

New Century AIM VCT plc is managed by M D Barnard & Co. Limited. Details of the relationship and transactions with the related party are included in note 3.

21. Capital commitments

There were no investments which were approved at the year end but which had not completed.

22. Control

New Century AIM VCT plc is not under the control of any one party or individual.

Shareholder Information for the year to 29 February 2012

The Company

New Century AIM VCT PLC was incorporated on 4 February 2005. In March 2005, the company obtained a listing on the London Stock Exchange. A total of £8.465 million was raised (before expenses) through an offer for subscription of new ordinary shares at 100p. The company has now reached the end of its provisionally approved period and now complies with the full requirements for approval.

The Investment Manager

New Century AIM VCT PLC is managed by M D Barnard & Company Limited, an independent fund management company based in Laindon, Essex. M D Barnard & Company currently manages or advises investment trust, unit trust and venture capital funds totalling approximately £30 million including New Century AIM VCT PLC.

Venture Capital Trusts

Venture Capital Trusts (VCTs) were introduced in the Finance Act 1995 and are intended to provide a means whereby individual investors can invest in small unquoted trading companies in the UK, with incentives in the form of a number of tax benefits. Investors subscribing for new shares in a VCT are currently entitled to claim Income Tax relief of 30% on their investment, irrespective of their marginal rate (up to a maximum of £200,000 per tax year). The tax relief cannot exceed the amount which reduces an investor's Income Tax liability to nil. In addition, all dividends paid by VCTs are tax free and disposals of VCT shares are not subject to Capital Gains Tax. Conversely, losses on VCT shares are not allowable to offset against taxable gains.

The company has now reached the end of its provisionally approved period and now complies with the full requirements for approval. In order to maintain its approval the company must comply with certain requirements on a continuing basis; in particular, within three years from the date of provisional approval at least 70% by value of the company’s investments must comprise “qualifying holdings”, of which at least 30% by value must be in eligible ordinary shares.

As with investment trusts, capital gains accruing to VCTs are not chargeable gains for UK Corporation Tax purposes.

Financial calendar

Annual General Meeting 2012	Â	Â	Â	30 August 2012
Interim report for six months to 31 August 2012 published				October 2012
Preliminary announcement of results for the year to 28 February 2013				June 2013
Annual General Meeting 2013				July 2013

Share price

The mid-market price of shares in New Century AIM VCT PLC is available daily on the London Stock Exchange website (www.londonstockexchange.com).