annual report and accounts · bha vision and mission 4 chair’s statement 6 chief executive’s...

2018ANNUAL REPORT AND ACCOUNTS

CONTENTS

BHA Vision and Mission 4

Chair’s Statement 6

Chief Executive’s Foreword 8

Financial Report 13

Strategic Report 25

Equine Welfare Leadership 26

Keeping Racing Fair and Clean 28

Growing British Racing Together 40

Competitive and Compelling Racing 42

World Class Racing 48

Looking After Our People 50

Directors’ Report and Governance Statement 57

Financial Statements 69

54

VISION AND MISSION

STRATEGIC OBJECTIVES 2018

Equine Welfare

Leadership:

Toprovideequine

welfareleadership

Growing British racing

together:Toleadin

growingBritishracing’s

relevance,revenues

andreputation

Competitive and

compelling racing:

Todelivercompetitive

andcompellingracing

World class racing:

Tocontinuetodevelop

aframeworkthat

advancesBritain’sability

tostagethebestquality

racingintheworld

Looking after our

people: Toimplement

properly-funded

andintegrated

recruitment,training

andretentionactivities

Keeping racing fair

and clean: Togrow

confidenceinBritish

Racingthrough

appropriateregulation

andintegrityprocedures

OUR VISION

TOGETHER, WE WILL BUILD ABRIGHTER FUTURE FOR OUR SPORT,OUR HORSES AND OUR PEOPLE

OUR MISSION

TheBritishHorseracingAuthorityisresponsibleforthegovernance,administrationandregulationofhorseracing

andthewiderhorseracingindustryinBritain.TheBHAleadsonthedevelopmentandgrowthofracing,and

prioritisesthehealthandwelfareofthesport’sparticipants

OUR VALUES

Integrity:Weaimtodotherightthingtoupholdthe

BHA'sreputationforfairness,andtomaintainthetrust

ofourstakeholders.

Accountable:Weaimtotakepersonalresponsibilityforour

actionsandstrivetoimprovethehealthofBritishracing.

Credible:Weaimtobeopenandhonestaboutwhatwe

do,andtreateveryonefairlyandwithrespect.

Responsive:Weaimtostayin-tunewiththesport’s

diversestakeholderssothatwecaneffectivelymeet

agreedobjectivesandgoals.

Progressive:Weaimtopromoteaforward-thinking

andcollaborativeculturewhilerespectingthestrong

heritageofBritishracingasasportandanindustry.

EQUINE WELFARE LEADERSHIP SUSTAINABLE IN

DU

STRY FU

ND

ING

WO

RLD

CLA

SS R

ACIN

G

FIN

ANCIAL RESPONSIBILITY

OUR OBJECTIVES

Integrity Accountable Credible Responsive

P

rogr

essiv

e

PR

OFESSIO

NAL W

ORKPLACE LOOKING AFTER OUR PEOPLE COMPETITIVE AND COMPELLING RACING G

ROWING BRITISH RACING TOGETHER

KEE

PIN

G RA

CIN

G FA

IR A

ND

CLE

AN

Enablers: culture,valuesandcapability;innovationandtechnology;representingBritishracing.

BHA VISION AND MISSION

AsensiblestartingpointforanynewChairistoassessthecurrentlandscapeandidentifythemainchallengesandopportunities.

ItisapleasuretointroducethisAnnualReportfor2018

whichsetsouttherangeofactivitytheBHAundertakes

asthesport’sgoverningbodyandregulator.OurChief

Executive,NickRust,givesanhonestandaccountable

assessmentofhowtheorganisationdealtwiththe

issuesandopportunitiesitfacedoverthelastyear.

OnbehalfoftheBoard,IwouldliketothankNickandall

hisstafffortheirworkandcommitment.TheBoardand

Iwillendeavourtoprovidethemwiththesupportand

challengetheyneedtobeevenmoreeffectiveinfuture.

Iwouldalsoliketothanktheracingfamilyforyour

immensecontribution-asstakeholders,partnersand

colleagues-inhelpingtheBHAtoprogressoursport.

IstartedmyroleasChairinJune2019,aftertheperiod

coveredbythisReport.Nick’sForewordcoversthe

keymomentsofthepastyearinsomedetail,soIwon’t

addtothat.ButIwouldliketothankmyimmediate

predecessorAthollDuncanwhoworkedwithgreatskill

andcommitmenttokeepthesportmovingforward

togetherduringadifficultperiod.SteveHarman’s

periodasChairmanhasbeenverywelldocumented.

WethankhimforhiscontributiontoBritishracingand

wishhimwellinthefuture.

Itisaprivilegetorepresentasportthat’ssosteeped

intraditionandhasplayedsuchanimportantpart

inenrichingthelivesofourhorses,ourpeople,our

communitiesandournation.Wehavesomuchtobe

proudof.Racing’sStoryisagreatstorytotell.

So,Iamdelightedtobeyourambassadorandyour

biggestadvocate.

Iwanttohelpracingreachthenewaudiencesthatwe

needtoattracttogrowoursportaswellasthosewe

needtoreassure.Iwanttoencouragethoseoutside

racingtoconsideroursportafreshandhelpthem

recognisetheuniquecontributionitmakestoBritishlife.

Wecelebratethethrillofseeinghorsescompete,whilst

theirspecialaffinitywithhumansbringssomuchjoy

andhappiness.

Competitionforaudiences,forsponsors,formediaand

broadcastspaceisintensebutcriticalforustomaintain

andgrowourimpact,influenceandrevenues.Iwant

theBHAtoplayitspartinbuildingtheprofileofracing

andchampioninginnovationtoattractnewcustomers.

Idon’tbelieveinchangeforthesakeofitbutwhereit

canhelpmovethesportandindustrytobeevenmore

successful,financiallysustainableandfuture-proofed,

wewillbewillingtobackit.Wearelisteninghardtowhat

ourpartnersandaudiencestellustoensurewecanbe

responsiveandsupportive.

Digitaltechnologyanddemographicchangeare

opportunitiesforracing.Weneedtounderstandthat

thosecomingofageasadultsnowhavedifferentviews

totheirparents.Wecanseetheimpactinpeople’sviews

onanimalwelfare,whereracingfacesaprofoundethical

challenge.I’mexcitedbysomeoftheideasI’vealready

heardtoaddressthisbychampioningourloveofhorses,

theirroleinournationallifeandthefulfillinglivesthey

leadasracehorses.

Adaptingthewaywepresentoursporttothe

worldisjustasimportanttoourengagementwith

parliamentarians.WehaveastronggroupofMPswho

loveracing,manyofwhomI’vealreadymet.

Butit’simportantwebranchoutbeyondourcore

supportgrouptopromotethesocialandeconomic

benefitsofoursport.We’remuchmorelikelytoachieve

ourobjectiveswithgovernmentifwecanwidenour

circleoffriendsandreassureanydoubters.

AsChairofBritishRowingandattheBritishOlympic

Association,Ihaveseensportsrespondtoreputational

andcommercialchallenges.Theexternalscrutiny

ofsport’sintegrityismoreintensenowthanever.

Expectationsarehigh.So,theexcellentreputationofthe

BHAandthesportinintegrityandequinewelfarewasa

greatattractionforme.I’mpleasedtoreportthatsame

professionalismisevidentinthesport’sapproachto

safeguardingitsmorevulnerablepeople.

Weknowracingisafamilyunitedbyourloveforhorses

andthesportandwelcomingtoeveryonewhoshares

ourpassion.Wecelebrateindividualstyleandself-

expression:no-oneshouldfeeltheycan’tbethemselves

inBritishracing.Andnooneshouldexperience

prejudice.Ourwomenjockeys–competinghead-to-head

withmen–areahugeasset.Wemustmakethemost

oftheirappealaswellasthediversebackgroundsof

peopleacrosstheindustry:racingisopentoeveryone.

OnethingIamveryclearabout,whenIassessthe

opportunitiesahead.Nowisthetimeforunity,not

division;forleaderswhocanworktogether,cooperate

andsometimescompromiseonallbarourintegrity.I’m

surewecanalwaysimprovethewayourorganisations

interactinthegovernanceofthesport,butIhopewecan

focusonseizingopportunitiesandaddressingimmediate

challengesratherthanfurtherstructuralreform.

Givenourplaceinthesport,theBHAmustbe

collaborativetothecore,arolemodelforpartnership

withoutlosingtheindependenceandrigourthat

maintainsthetrustofgovernmentandothers.That’sthe

bedrockofourcredibilitywithexternalaudiencesasthe

sport’sregulator.Butweknowourcredibilitywithinthe

sportdependsuponanopenandtrustingrelationship

withourparticipantsandIlookforwardtoworkingwith

youalltosecuretheverybrightestoffutures.

Annamarie Phelps

Chairman

76

CHAIRMAN’S STATEMENT

CHAIR’S STATEMENT

98

CHIEF EXECUTIVE’S FOREWORD


TheforewordofanAnnualReportalwaysprovidesanopportunitytostandbackandreflect,seeingayearinsnapshot,andaskingifitwasagoodyear,achallengingone,oramixtureofboth.

2018wasundoubtedlyagreatyearforBritishracing

onthetrack.VictoriesforBritish-trainedhorsesatthe

Arc,Breeders’Cup,DubaiWorldCupandMelbourne

Cupmeetingsin2018notonlystirredasenseofnational

pride,butshowedthatBritishracingistrulyworld

class.AttheCheltenhamFestival,British-trained

horseswontheChampionHurdle,ChampionChaseand

theCheltenhamGoldCup.Thefactthathorsesfrom

elsewherewonastringofotherbigracessuggeststhat

wecontinuetoattractthebestoftherestaswell.

Thesportneedsitsstars,equineandhuman,tobuild

engagementwiththesport.Stradivarius,intakingthe

firstWeatherbysHamiltonStayers’Million,wona£1m

bonusbut,moreimportantly,alegionoffans,whoare

continuingtocheerontheirheroin2019.And,onthe

subjectofstarquality,weweredelightedtowelcome

TigerRollasapopularwinneratboththeCheltenham

FestivalandtheGrandNational.

Thereismuchtocelebrateinoursportanditishelpful,

asaregulator,toberemindedofthis.Theroleofa

regulatoristoensurefairnessandfairplay.Doingso

requirestheestablishmentandenforcementofrules

buttherulesexisttoprotectandempowerthemajority,

farmorethantheyservetopunishorreprimand

theminority.

Ihavereflectedonthisatlengthinrecentmonths,

followingayearinwhichtheBHA’sregulatoryremit

hasbeenchallengedonmultiplefronts–from

withinthesport,whichsometimesfeelstheBHAis

tooremotefromthesportitserves,andfrom

outsideit,bythosewhofeeltheBHAistooclose

toracing’sstakeholderstobesufficientlyrobust

andimpartial.

Thereisabalancetobestruck,clearly,andthisbalance

isbestachieved,quitesimply,bydoingwhatisright,

usingastrongevidencebasetounderpinourregulation,

bringingpeoplewithuswheneverwecan,whilstalso

beingmindfulthattheburdenofregulationremains

proportionate,manageableandmakesatangible

positivedifference.

Ifreelyadmitthat,duringthepast12-18months,wehave

notalwaysgotthisright.Sometimeswehavemoved

toofast,sometimesnotfastenough.Wehaveworked

hardtolearnfromthis,andIrestateourcommitment

toworkingwithothersinoursport,understandingtheir

challengesandharnessingtheirexpertise,tomake

sustained,continuousimprovements.

Racinghastokeeppacewiththeoutsideworld.We

madesomeimportantchangestoourstewardingmodel

atthebeginningof2019.Theprinciplebehindthemwas

clear;ifwewanttobeseenasaleadingsport,weneed

refereeingandintegrityprocessesandstandardsthat

match.Thatisn’taboutwhetherstewardsarevolunteers

orprofessionalsbutwhethertheyareequippedand

supportedtofulfiltherolethatisrequiredofthem.

We’rerunningasubstantialtrainingandassessment

programmetohelpwiththisin2019.Iknowwecould

havecommunicatedthechangesbetterattheoutset

butpeoplefromacrossthesportarenowworkingwith

ustomakethisasuccess.

Challengesfromoutsidethesport,wheretheBHA’srole

istorespondonracing’sbehalf,includethoseonhorse

welfare,thesubjectthatengendersmorepassionand

emotionthananythingelseweencounter.TheBHA’s

mandatetoregulateindependentlyonequinewelfare

wasregularlyquestioned.Animalrightsgroupsremain

attheextremeendofthewelfaredebatebutthereisno

doubtthatwiderpublicattitudestotheuseofanimals

insportarehardening.Thebalancetobestruckhere

isintalkingupracing’sexcellentrecordonwelfareand

safety,whilstalsobeingopentofurtherprogress.

Thedeathsofsevenhorsesasresultofracingatthe

2018CheltenhamFestivalgaverisetosomepublic

concernandpoliticalscrutinyandwasasharpreminder

thatracingisdependentoncontinuedsociallicence.

OurreviewoftheFestival,publishedinDecember,

re-emphasisedtheneedforthesporttoworktogether

onwelfare,usinganevidence-ledapproachthat

focusesonavoidingreasonablerisk.Meanwhile,the

decisiontoestablishaHorseWelfareBoard,witha

mixofrepresentationfrombothinsideandoutsidethe

sport,includinganindependentChair,BarryJohnson,

isafurtherdemonstrationofourcommitmentto

collaborationandprogressinthisarea.

Publicandpoliticalexpectationsarealsohigherthan

everinrelationtothecareofpeople.Therecruitment

ofnewrolesintheareasofsafeguardinganddiversity

reflectstheneedforracingtoensurethesportis

asafe,openandhappyplacetowork.Withstaffing

shortagescontinuingtoposesignificantchallenges,the

developmentofapositiveanddiverseculture,reflecting

contemporaryBritain,isvital.

Thisbringsmetotheeconomicandpoliticalcontext.It

seemsalmostinevitablethatIam,onceagain,writing

aforewordthatexpressesuncertaintyaboutboththe

timingandthelonger-termeconomicconsequencesof

theUK’sexitfromtheEuropeanUnion.Thesporthas

workedhardtounderstandandminimisethedirect

impacts,particularlyinrelationtothemovementof

horses,butthewiderUKeconomicbackdropremains

unclear.Wearecontinuingtoworkacrossthesport

andwithGovernment,tounderstandandmanagethis

enduringlyfluidsituation.

Ayearago,Iexpressedconsiderablesatisfactionat

theinitialsuccessofoureffortstosecurereformof

theLevy.Wealwaysknewthatthiswasnottheendof

thestory,however,andthatfurtherreformwasalways

goingtobeneeded.Iexpectedtobedescribingthe

firstmonthsinthelifeofthenewRacingAuthorityin

thisforeword.However,theRacingAuthorityfellata

parliamentaryhurdleattheendof2018andwehave

beenworkingwithDCMSandtheHorseraceBetting

LevyBoardonthelikelynextsteps.

Alongsidethis,securingthesport’sfinancesbecame

moreurgentfollowingpublicationoftheGovernment’s

GamblingReviewinMay2018,whichreducedthe

maximumpermittedstakeonFixed-OddsBetting

Terminals(FOBTs)to£2fromApril2019.Whilethe

sportfullysupportseffortstocurbproblemgambling,

thesignificanteffectonbettingshopsiscertaintohave

knock-onfinancialimplicationsforracing,whichneedto

beappropriatelyforecastandmitigated.

Theearlymonthsof2019gaveanindicationofthe

challengestocome,withconsiderabledebatearound

prizemoneylevels,followedbythesoberingnewsthat

the2018/19Levyyieldwaslowerthanforecast.The

sportmustavoidthetemptationtoretreatintobunkers

whenthegoinggetstough,insteadworkingtogetherto

confrontthissharedfinancialchallenge.Wemustall

adaptwherenecessary,whilstbecomingmorecreative

andinnovativeinourcommercialthinking.

1110


Withthisinmind,theBHAanditsmembersarefocusing

hardonourcollectivestrategyforthefuture.AsIwrite,

thesporthasjustcommissionedanewindependent

economicanalysistogetaclearunderstandingof

racing’sfinancialpositionandtheflowoffunding.The

aimistosecureasustainablefutureforallstakeholders

withinthesport,whilstensuringthatdecisionsaround

fixtures,prizemoneyandotherfundingareinformedby

objective,accuratedataandanalysis.

Thesport’sgovernancebecomesvitallyimportantin

thiscontext.TheBHABoardspentaconsiderable

amountoftimein2018discussingitsoperationand

structurewithourmembers,partlyinformedbyan

independentreviewofracing’sgovernance,toensure

itremainsfitforpurposeandequippedtohandle

contemporarychallenges.Alreadyin2019,wehave

madechangestotheBHABoardcompositiontogivea

strongervoicetoourmembers,intheexpectationthat

thiswillfostergreatercollaboration.Weareundoubtedly

strongertogether.

SpeakingoftheBHABoard,IwouldliketothankSteve

Harman,whosteppeddownasBHAChairinNovember,

andAthollDuncan,whosteppedintothebreachwhile

anewChairwasbeingappointed.Finally,Iextendthe

warmestofwelcomestoAnnamariePhelps,whotookup

theroleinJune2019andwhowillleadtheBHABoard

throughthisnextstageinitsevolution.

So,whatwastheverdicton2018?Inevitably,itwasa

mixedpicture.Whileitwassometimeschallenging,we

haveinvestedtimeandeffortinconfrontingsomeharsh

realitiesandsettingourselvesupforthefuture,atthe

sametimeascelebratingsomemagnificentmomentsin

ourmarvelloussport.

Nick Rust

Chief Executive

2018wasthesecondyearofourcurrentthreeyear

budgetcycle(2017-2019),overwhichperiodweare

aimingtobreakevenincashterms.Performancein2018

wasagainbetterthanbudgetedwithincreasesinincome

leadingtoanincreasedsurplus.Theadvantageofbeing

slightlyaheadofourthreeyearplan,followingimproved

resultsin2017and2018,wasthatfeeinflationfor2019

wasabletobesetatlowerlevelsthananticipated,

meaninganysurplusesgeneratedin2017and2018have

beenusedtosupportincreasedactivity

orreducedfeesforparticipantsandracecoursesin2019.

Deliveringqualityandvalueformoneyisessential

givenwearefundedbyparticipantsandracecourses.

Thechallengeistobalancetheneedsoftheindustry

andtheresourceswehaveavailableinprovidingthese

activities.Thismeansmakingtoughdecisionsover

spendingorrecruitmentbutbalancingtheseagainst

theneedtodriveinnovationandbeprogressiveinour

servicedelivery.

A summary of key areas of activity in 2018 is set out

below. Many of these items are set against our need

to respond to the changing environment which we

work within:

• Thefirstfullyearoftheindependentjudicialpanel

includingdeliveryofthefasttrackprocessto

increaseefficiencyoversmallercases.Thisnew

processhasdeliveredfinancialsavingsvsbudget

withtheactualpanelbeingrequiredtositless

frequentlythantheydidhistorically.

• CompletionoftheCheltenhamReviewand

implementationoffindings.

• Continuedprogressionofdiversityandinclusion

includingtherecruitmentofspecificresourceto

deliveranindustryactionplan.

• Significantworkinrelationtosafeguardingandwider

industrysafeguardingpolicies.

• ExpendituretoensurecompliancewithGDPR.

• Consultationandlaunchofthenewmodelforraceday

regulation.

• Increasedracedaytestingforgroupandgradedraces

deliveredthroughanewlongtermagreementwithour

researchandtestingpartner,LGC.

• Ongoingchangestotheraceprogrammeincludingfor

exampleoptionalclaiminghandicaps.

• ContinuedexpenditureontherewriteoftheRules

ofRacingwhichhavebeencompletedandlaunched

in2019

• Thecommencementofareviewintothebuyingand

sellingofhorses(‘BloodstockReview’)undertakenby

independentconsultantsonbehalfoftheBHA.

• Ongoingreviewfordeliveryofracingadministration.

• Changestocorporatestructurefollowingmeaningful

dialoguewithmemberbodiestodelivergreater

representationontheBHABoard.

• AthirdpartyreviewofBHA’sapproachto

handicapping.

• Negotiationoflowerthanbudgetedpensiondeficit

fundingfor2019.

Withtheaboveinmind,ourcompanyonlyresultsbelow,

whichexcludestatutoryadjustmentsforpensions,

demonstratetheoverallvaluebeingdeliveredeachyear.

1312

FINANCIAL REPORT

PROVIDING VALUEFOR MONEY FOR THE SPORT REMAINS A PRIORITY

FINANCIAL REPORT

1514

FINANCIAL REPORT

HEADLINE NUMBERS FOR 2017 AND 2018 INCOME EXPLAINED

INCOME

2017 2018

£'000 £'000

Income 33,236 34,414

Administrativecosts (32,907) (34,296)

Operatingsurplus 329 118

Interest 12 14

Surplus before statutory adjustments and tax 341 132

2017 2018 Variance Variance

£’000 £’000 £’000 %

Racecourses 21,811 22,168 357 1.6%

Owners 8,570 8,758 188 2.2%

Otherparticipants 699 750 51 7.3%

Publications 515 528 13 2.5%

Managementandpropertycharges 552 559 7 1.3%

Fines 132 143 11 8.3%

Internationalrunnerandpermanentimporttesting 184 281 97 52.7%

Industrytrainingandcareersmarketingincome 39 229 190 487.2%

GreatBritishRacingInternationalfunding 325 428 103 31.7%

Other 409 570 161 39.4%

Total statutory income 33,236 34,414 1,178 3.5%

Thestructureofourincomedoesmateriallychange

eachyearwithcirca65%comingfromracecourses,25%

fromownersand10%fromotherareas.Racecourses

receivecentralfundingfromtheHorseraceBettingLevy

Boardtoassisttheminfundingasignificantproportion

ofthesecosts.

Inlinewithourpriorcommitmenttostakeholders

allfeesroseby2.75%inJanuary2018,whichwas

lowerthaninflation(3%CPIinDecember2017)and

significantlylowerthantheCPIplus0.75%whichcould

havebeenapplied,basedonthe3-yearagreementwith

ourmembers.

Incomefromracecoursesroseby1.6%.2017includeda

one-offamountwhichmasksthecomparison,whenthis

isremoved,thereallike-for-likeincreaseis4.2%,driven

byamixtureoftheinflationaryincreasedescribedabove

andadditionalfixtures.

Incomefromownersroseby2.2%,slightlylower

thantheleveloffeeinflation.Incomefromowners

issplitintotwomainareas:entryhandlingfees

andregistrations.

Entryhandlingfeesroseby2.5%,thisslightlylower

levelofincreasecomparedtoinflationisprimarilydue

tofewerentriesmadeinoverseasracesthanin2017,

activity,andthereforeincome,fromentriesinGBraces

increasedbymorethaninflation.Increasedentry

activityisanotherpositivemetric.

Registrationincomeroseby1.9%,againlessthan

inflationduetochangesinIFHApassportrequirements,

theimpactofwhichwillbefeltagainin2019,and

increaseddiscountsforROAmembers.Overall

registrationactivitylevelswereingeneralpositive

whichhelpedtominimisetheimpactoftheabovetwo

areasandgivesconfidenceoverfutureincomelevels

beingmaintained.

Oftheremainingincome,theonlyotherareasworth

notingare(i)theincreaseinincomefromInternational

RunnerandPermanentIncometesting,thisissolely

acostrecoveryandincreasesaredrivenbyincreased

activityand(ii)thelargeinvestmentinrecruitmentand

careersmarketingtoaddressissueswithinthesport.

Thisfundingallowedustosignificantlyincreaseactivity

onbehalfofthesportandwasakeystrategicobjective

withinourbusinessplan.

64.4%Racecourses

25.5%Owners

2.2%Otherparticipants

1.5%Publications

6.4%Allother

1716

FINANCIAL REPORT

COSTS

2017 2018 Variance Variance

£’000 £’000 £’000 %

Totalstaffcosts 16,833 17,266 433 2.6%

Weatherbys 5,341 5,282 (59) (1.1%)

Samplingandresearch 3,506 3,595 89 2.5%

Propertyandoverheads 2,740 2,713 (27) (1.0%)

Projectspend 677 1,395 718 106.1%

Legalandprofessional 847 686 (161) (19.0%)

Communicationsandcorporateaffairs 520 528 8 1.5%

Publicationandproductioncosts 409 431 22 5.4%

Committeesandenquiries 479 405 (74) (15.4%)

ITinfrastructureandnetworkcosts 194 234 40 20.6%

Industrycareersmarketing 174 356 182 104.6%

Internalstafftrainingandrecruitment 197 344 147 74.6%

BHDlicencefee 160 156 (4) (2.5%)

Impairmentcharge 148 0 (148) (100.0%)

Horsemen’sGrouploanrepayment (50) (75) (25) 50.0%

Other 334 552 218 65.3%

GBRI* 398 428 30 7.5%

Total** 32,907 34,296 1,389 4.2%

*GBRItotalcostsamountedto£428,000,offsetby£428,000ofincomethatGBRIderivesfromothersources,meaningnooverallcosttoBHA.

**Totalcostsaredifferenttothoseshowninthestatutoryaccountsduetostatutorypensionadjustmentsforpensions,theabovecostsinclude

theBHA’scashcontributionstothepensionscheme.Wherestructuralchangeshavebeenmadein2018forreportingpurposes,the2017cost

comparisonshavebeenupdatedtoensureappropriateevaluationcanbemade.

COST ANALYSIS

Overallcostsroseby£1.4m(4.2%)in2018,partlyasa

resultofadditionalactivities.Iftheseadditionalproject

costsareremovedandalike-for-likeprojectspend

assumedthencostsonlyroseby2%,1%lowerthan

CPIinflation.Greaterdetailofsignificantcostsand/or

costchangesisexplainedbelow.Theintentionistobe

openandtransparentinourreportingonour

financialperformance.

• Total staff costsincludethecostofallstaffand

theBHABoard.Overall,costsroseby2.6%mainly

duetogeneralsalaryinflationof2.75%.Changesin

headcountshownbelow,didnotaddtooverallcosts

withstructuralchangesincertainareasoffsetting

increasedresourceinotherareas.

• Weatherbysprovideadministrationservicesonalong-

termcontractwhichexpiresonthreeyears’notice.

Forthesecondyearrunningarealtermssavingwas

deliveredwithcostsinnominaltermsbeinglowerthan

in2016.Thishasbeenachievedalongsidenewand

improvedadministrationservicesforparticipants.

• Sampling and researchhasbeenrestatedin2018

toincludebothequinesamplingandresearchand

jockeysampling.2018wasthelastyearofour

agreementwithLGC,ourresearchandtesting

partner,andwehavesignedanewagreementwhich

takesusthroughtotheendof2023.Thislongterm

commitmentfrombothpartiesallowsforcontinued

investmentinoperationalimprovementsaswellas

newcapitalexpenditurebyLGCinnewstateoftheart

equipment.Thisareaofactivityremainsakeyareaof

ourstrategicbusinessplanin2019andgoingforward.

Theincreasedspendin2018reflectsbothinflationand

activitychanges.

• Therehavebeenlimitedchangesinourproperty and

overheadcostsin2018.LeasesonourLondonoffices

aredueforrenewalin2020witharentreviewin2019.

Wewillthereforelookatalloptionsforthefuture

needsofthebusiness.Thesepropertyandoverhead

costsareshowngrossanddonottakeaccountofthe

significantareasofspacewhichwerechargetoother

Racingstakeholders.

• Project spendisnaturallyvariableeachyearduetothe

needsofthebusinesstoreacttoindustrychangesand

leadonnewactivities,thereforeyearlycomparisons

arerarelyofgreatbenefit.Thethreemainareasof

spendin2018wereasfollows:

• DevelopmentofthenewRulesbookwhichhave

alreadybeencompletedanddeliveredin2019.

Itsintentiontosimplifyandremovepolicyfrom

theruleswillcreatemoreunderstandablerules

forparticipantstofollowandforus,asregulator,

toenforce.

• Thereviewintothebuyingandsellingofracehorses

wasasignificantareaoffocusin2018.Thisworkwas

undertakenbyindependentexperts,thefindingsof

whichareagainduein2019.

• WealsoundertookareviewofRacingAdministration

practicesandengagedanexternaltechnologyfirm

toassistwiththisreview.

51.7%Totalstaffcosts

15.8%Weatherbys

10.8%Samplingandresearch

8.1% Propertyandoverheads

2.5%Projectspend

2.1%Legalandprofessional

1.6%Communicationsandcorporateaffairs

1.2%Publicationandproductioncosts

1.2%Committeesandenquiries

5%Allother

1918

FINANCIAL REPORT

• Legal and professional costsreducedby19%in

2018,followinga35%reductionin2017meaninga

52%reduction(£621,000)inthelasttwoyears.This

isdrivenbysavingsinlevyrelated,regulatoryand

corporatecostsoffsetbyincreasesinemployment

andpensionadvice.

• Communications and corporate affairsisarelatively

consistentareaofexpenditure.Wecovercosts

associatedwithourgovernmentrelationsactivity,

theGodolphinStudandStableStaffAwards,The

HorseComesFirstcampaign,whichisco-fundedwith

otherstakeholders,racing’scommunityengagement

programme(‘RacingTogether’)throughRacingto

SchoolandalsoactivitytolaunchRacingFuturesto

assistwithdeliveringaclearvisionforthesport.

• Publication productioncostsrelateprimarilytothe

RacingCalendarandProgrammeBook.Afterthree

yearsofcostsavings,weincreasedcostsinthisyear

by£22,000.Thesecostswerespecifictocommissions

paidforthesalesofadvertisingontheNewRacing

AdministrationSiteandtheRacingDirectory.These

costshavedeliveredinrelativetermsasignificant

increaseinotherincome.Excludingthisadditional

areaofspendcostsareconsistentwith2018.In2019,

wewillmakefurtherchangestothedeliveryofthe

RacingCalendarandProgrammeBookwhichwill

deliverfurthercostsavingswhichhavebeenpassed

backtoparticipantsthroughreducedpublicationfees.

• Committee and enquirycostsfellby£74,000in

2018asthenewfasttrackprocesswaslaunched

significantlyreducingthenumberofpanelsittings

requiredaswellasprovidingimprovedresponse

timesforparticipants.

• Industry careers marketingwasanareaoffocus

during2018aswesignificantlyincreasedspendon

industryrecruitmentinitiativesinordertorecruitnew

staffandaddressanoverallissuewithracing’swider

workforce.Furtherspendwasmadeonsafeguarding

policiesandsupport.Thesearewiderstrategic

initiativesforthesportandforBHAassetoutinour

businessplan.

• Internal staff training and recruitmentwasanother

priority.Trainingcostsincreasedby10%asweaimed

tosupportstaffdevelopmentacrossthebusiness.

Recruitmentcostsweredrivenbyseniorrecruitment

atboard,executiveandseniormanagementlevel.

• The£75,000creditinrelationtotheHorsemen’s

Group loan,wasanadjustmenttoabaddebtprovision

havingreceivedthiscashinearly2019.Thisleaves

abalanceof£125,000outstandingfromtheoriginal

£500,000loan.

STAFF ANALYSIS

Number of staff FTE Number

of staff FTE Number of staff FTE

Business area 2017 2017 2018 2018 Variance Variance

Integrityandregulatoryoperations 102 87.1 107 91.4 5 4.3

Racedayoperationsandregulation 54 47.3 58 49.6 4 2.3

Racingandoperations 40 39.3 43 42.7 3 3.4

Executiveoffice(includesexecutivesupport) 15 14.6 15 14.5 - (0.1)

Communicationsandcorporateaffairs 8 7.5 7 6.5 (1) (1)

Industryrecruitment,trainingandretention 5 4.8 6 5.8 1 1

GBRI 4 4 4 4 - -

Legalandgovernance 2 1.6 3 2.6 1 1

Total 230 206.3 243 217.1 13 10.8

Ourpermanentheadcountwas243(217.1FTE)at31December2018,13(10.8FTE)higherthanatthesametimein

2017.Thesenumbersexcludesessionalstaffwhoarenotincludedinthetablebelow.Theseheadcountnumbers

areasnapshotandcanbedistortedwhererolesarevacantinoneyearbuthavebeenrecruitedbytheendofthe

followingyear.

Integrity and regulatory operationsandRaceday

operations and regulationarebetterexplainedasone,

asthesefunctionsprovideregulationforthesporton

botharacedayandthroughheadofficeactivities.Alsoby

reviewingthemasacombinedtotalitenablesanytransfers

betweendifferentregulatoryfunctionstobeignored.

Theincreaseof9heads(6.6FTE)withinthisareaisdue

toacombinationoffactors:increasingresourcewithin

theracedayfunctions(mainlystewarding,veterinaryand

equinewelfareintegrityofficers)toundertakeadditional

regulatoryactivities.Theotherareawasanincreasein

projectbasedresource(oneofwhichwasaninternal

transferfromcommunicationsandcorporateaffairs)to

continuetodriveforwardservicesandinnovate.

TheRacing and operationsteamhadvarioustemporary

vacanciesattheendof2017andthethreeadditionsin2018

weremerelyaresultofthesevacanciesbeingfilled.

TheExecutive officeincludesourexecutivedirectors,their

supportstaffandotherstaffnotincludedelsewhere.Whilst

theoverallnumberdidn’tchange,thesplithaschanged

slightlywithonepersonalassistantleavingbutaHeadof

DiversityandInclusionhavingbeenrecruited.

TheIndustry recruitment, training and retentionteams

tookonadditionalresourceinthecareersmarketingarea

tosupportdeliveryofakeystrategicobjective.Further

recruitmenthasbeenmadein2019.

TheLegal and Governancefunctionshavetakenonan

additionallawyerin2018whichhashelpedreduced

externallegalspend.

2120

FINANCIAL REPORT

GENDER PAY REPORTING

WearerequiredtocomplywithGenderPayGapreportingrequirementsgivenourrelevantemployeesareover250

atthesnapshotdateof5April2018.Relevantemployeesatthisdateincludeanumberofsessionalworkerswhoare

ordinarilyexcludedfromourheadcountnumbersonpage19.

Theresultsareshowninthetablesbelow.

2017 2018

Meangenderpaygapinhourlypay 16% 18%

Mediangenderpaygapinhourlypay 15% 10%

Meanbonusgenderpaygap 66% 42%

Medianbonusgenderpaygap 31% 0%

ProportionofMalesreceivingabonus 20% 87%

ProportionofFemalesreceivingabonus 34% 95%

Male Female

Quartile1 78%(78%) 22%(22%)

Quartile2 81%(73%) 19%(27%)

Quartile3 69%(80%) 31%(20%)

Quartile4 51%(47%) 49%(53%)

PROPORTION OF MALES AND FEMALES IN EACH QUARTILE PAY BY QUARTILE (2017 NUMBERS SHOWN IN BRACKETS)

GENDER PAY REPORTING

Implemented actions Future committed activities

Equippingourleaders

Leadership,managementandunconsciousbiastraining

Appointedheadofdiversityandinclusiontodrivechangeinitiatives

Deliverdiversityandinclusionprogrammestomanagers

Recruitment

Introducedgenderneutralrecruitmentprocesses

Diverseandbalancedselectionpanelsusedforinterviews

Reviewinternalprogressionandpromotion

Providetrainingtoensuremanagersadoptneutralrecruitmentpractices

Introducemonitoringfordiversityandinclusion

RetentionandDevelopment

Employeescanrequestflexibleworking(includingworkingfromhome)

Provideoptionofsharedparentalleave

Reviewsuccessionplansandstrategiestoensurebalancedtalentpipelines

Promotecareerprogressionthroughmanagementpracticesanddevelopmentopportunities

Benchmarkourenhancedmaternityleave

The BHA’s gender pay gap, which is slightly below

the national average, is primarily owing to:

• Fewerwomeninseniormanagementpositions

• Arelativeconcentrationoffemalesinthelowest

payquartile

Evenallowingfortheabovewehaveseenan

improvementfrom15%to10%inourmediangender

paygapbetween2017and2018.

Wesetoutbelowpositivechangesmadesincethe

publicationofourfirstgenderpayreportandalsoour

futurecommitmentsasweseektocontinueseekto

makepositivechanges.

2322

FINANCIAL REPORT

RECONCILIATION TO STATUTORY ACCOUNTS

TAXATION

COMPANY BALANCE SHEET

Whenpreparingstatutoryaccounts,wearerequired

tomakeanadjustmenttothewaywetreatpension

contributions.Inthecostsprovidedonpage16,we

showpensioncontributionsbaseduponthecash

contributionspaidaswebelievethisbetterreflects

therealcosttothebusiness.

Forstatutorypurposes,wereplacethesecontributions

withinterestandservicecostsasprescribedunder

FinancialReportingStandard102.Thisensures

consistencyacrossallcorporateaccountsand

improvesourresultsfor2018by£646,000.

Wehaveexcludedtheseadjustmentsfromthe

financialanalysisastheydistortthecostofour

operationsandareunpredictable.

Wearealsorequiredtoproduceconsolidatedstatutory

numberswhichincludetheoperationsofGreatBritish

RacingLimitedandBritishHorseracingDatabase

Limited.Theanalysisandcommentaryaboveisbased

ontheBHA’sactivityonly.

TheBHA’sbalancesheetisagainrelativelystable

year-on-yearwiththemainchangesbeingcausedby

significantcapitalspend,workingcapitalmovementsor

achangeinthepensiondeficitliability.Totalnetassets

improvedfromnetliabilitiesof£8.6min2017tonet

assetsof£1.3min2018.Thiswasalmostentirelydue

toothercomprehensiveincomeof£9minrelationto

changesinactuarialassumptionsinthe

pensionscheme.

Attotalassetslesscurrentliabilitieslevel(which

excludesthepensionliability)thechangeissignificantly

lesswithoverallassetsincreasingfrom£9.4mto£9.6m.

Inmanyways,thisisabetterreferencepointforthe

ongoingassetsofthecompany.

Fixedassetsreducedfrom£5.4mto£5.1movertheyear

primarilyasaresultofdepreciationandamortisation

charges.Therewaslowercapitalexpenditure(including

capitaliseddevelopmentstaffcosts)thaninprevious

yearsduetonomajorexpenditurebeingmade.

Debtorsreducedfrom£7.9mto£7.5m,thiswasaresult

ofreducedtradedebtorsatyearendoffsetbyahigher

levelofprepayments.

Cashreducedfrom£10.8mto£10.5m.Ourcashbalances

includeringfenceditemswhichwedonotusefornormal

activities,onceexcludedtherealmovementinoperating

cashwasfrom£4.8mto£4.9m.

Creditorsfallingduewithinoneyearreducedfrom

£14.8mto£13.6m,thereductionbeingdrivenbyreduced

tradeandothercreditorbalances.

Thepensionschemedeficitreducedfrom£17.9m

to£8.2m.Asdiscussedabove,alargepartofthis

movementarosefromchangesinactuarialassumptions

followingthelatestvaluation,aswellasexperience

adjustmentswhichcontributedtowardsareduction

inplanliabilitiesof£13.5m.TheimpactofGMP

equalisationwasestimatedat1%ofschemeliabilities

andhasbeenincludedintheliabilityofthescheme.

AstheBHAisconsideredacommercialentityfor

corporationtaxpurposes,wecontinuetotakeadvantage

ofResearchandDevelopment(R&D)taxcredits

forexpenditureincurredinveterinaryandmedical

research.TherefundfromHMRevenueandCustoms

(HMRC)inJanuary2018was£11,000higherthanhad

beenpreviouslyprovided,thisplusalikelyrepaymentof

£56,000inrespectof2018anticipatedcreditsgivesthe

totaltaxcreditof£67,000.

2017 2018

£'000 £'000

Surplusbeforestatutoryadjustmentsandbeforetax 341 132

AdjustmentsinrespectofFRS102forpensions 715 646

Statutory surplus before tax 1,056 778

2017 2018

£’000 £’000

Surplus/(deficit)beforetaxation 1,056 778

Taxation 173 67

Surplus / (deficit) after taxation 1,229 845

25

STRATEGIC REPORT

Equine Welfare Leadership 26

Keeping Racing Fair and Clean 28

Growing British Racing Together 40

Competitive and Compelling Racing 42

World Class Racing 48

Looking After Our People 50

2726

STRATEGIC REPORT

EQUINE WELFARE LEADERSHIP

Ensuringthebestpossiblestandardsofequinewelfareandsafetyremainsakeypriority,andtheBHAiscontinuingtoconsiderhowracehorsesenjoya“lifewelllived”atallstagesoftheirlivesandcareers.TheBHA’sregulatoryroleinsettingandapplyingwelfarestandardssitsinabroadercontextofcontinuousimprovementacrossthesport,withallstakeholdersandparticipantsplayingtheirpart.

Horse welfare programme

Aneffectivewelfarestrategyrequiresracingtocome

together,aswecannotsimplyregulateourwayto

success.Withthatinmind,theBHAworkedwithits

membersin2018onthedevelopmentofacross-industry

horsewelfareprogramme.Aninterimgroupwas

convenedfromacrosstheindustrytodeterminehow

besttoachievethis.Thefirstconsequencewas

thedecisiontocreateanew,independently-chaired

HorseWelfareBoard,whichisbeingconvenedin2019

withtheinitialobjectiveofcreatinganequinewelfare

strategyfor–andwith-thewholeofracing.

30-day foal notifications

TherequirementforbreederstonotifyWeatherbys

GeneralStudBook(GB)within30daysofthebirthof

anyfoalbredforracingwasintroducedfrom1January

2018.Thisrequirementprovidesgreatertransparency

andinformationregardingthewhereaboutsoffoalsborn

toraceinthesport,bringingGreatBritainintolinewith

internationalbestpractice.

In2018,92.3%offoalswerenotifiedwithin30days.

Bymid-July2019,thishadrisento96.34%-afantastic

resultfrombreeders.Penaltyforlatenotificationis

consideredonacase-by-casebasis,with30foals

beingtestedduetolatenotificationbymid-July.

Cheltenham Festival Review

TheBHApublishedareviewoftheCheltenhamFestival,

whichcontained17recommendationsaimedat

reducingtheriskofequineinjuries,fallsandfatalities

atCheltenhamandallJumpracecourses.The67-page

reviewcontainedthefindingsfromarigorousprocess

ofdataevaluation,consultationandreviewofvideo

evidence,ledbyadedicatedreviewgroupandwithinput

fromexternalexpertsincludingtheRSPCAandWorld

HorseWelfare.

Thecentralareasoffocusforthereviewfellacrosssix

broadcategories:thecourses;theobstacles;participant

factors;starts,safetyfactorsandracetempo;

programmingandraceconditions;andveterinary

historiesandprotectivemeasures.Thedetailedanalysis

coveredallracesrunattheFestivalfrom2007to2018,

including5,451runnersand308fallers.

Theevidencefoundthatnosinglefactorwasdefinitively

responsiblefortheequinefatalitiesatthe2018Festival,

andthatnon-trackfactors–suchasveterinary,

participant,andraceconditionfactors–couldpotentially

beofequal,orpotentiallygreater,significancethan

track-relatedfactors.

The headline recommendations from the Review were:

• Pre-Raceveterinaryexaminationstobeincreasedto

includeallrunnersinallracesattheFestival,witha

viewtoidentifyinganyriskfactorsthatmightmakeit

necessarytopreventahorsefromrunninginarace

• Reductionin‘safetyfactor’(maximumfieldsize)in

all2-mileChasesrunatthecoursefrom24to20,

e.g.theGrandAnnualChase

• RaceconditionsoftheMartinPipeConditional

Jockeys’HandicapHurdletobealteredtoremove

allriderweight-claimingallowances

• Developmentofapredictivemodel,toidentifyrisk

factorsforallJumpracing,includinghorsehistory

andperformance,riderandtrainingfactors

Allrecommendationswithimplicationsforracesand

proceduresatthe2019CheltenhamFestivalwere

implemented,withtheassistanceandco-operationof

CheltenhamRacecourseandJockeyClubRacecourses,

andthejockeysandtrainerswhocompetedat

Cheltenhamduringthe2018/2019season.

Owner and Trainer Aftercare Surveys

In2018theBHAlaunchedtheOwnersandTrainers

AftercareSurveys.Bothsurveysbenefittedfromhigh

responserates.

TheTrainersSurveyidentifiedthatthemajorityof

horsesarebeingsenttoretrainingorbreedingfollowing

retirementfromracing.TheOwnerSurveyhighlighted

owners’interestinthelifeofthehorseafterracing.

Resultsfrombothsurveysemphasisedtheconnection

betweenownersandtrainerswithownersciting

trainers’knowledgeandrecommendationsinover70%

ofdecisionstopermanentlyretirearacehorse.

TheBHA’sequinehealthandwelfarestrategyhas

recognisedthevaluableresponsesreceivedfromboth

ownersandtrainers.WorkingwiththeThoroughbred

IndustriesMeetingGroup,theBHAisactingtoimprove

thetraceabilityofretiredracehorses.ThenewRacing

AdministrationSystemwillenabletheOwnerorTrainer

tonotifyboththeBHAandWeatherbysofthedecision

topermanentlyretirearacehorse,completethe

equivalentofanon-racingagreementandprovidenew

keeperdetails.Thisstreamlinedprocesswillincrease

traceabilityandprovidetheindustrywithgreater

informationontheretirementprocessenablingfurther

improvements.

TheOwnersSurveyfoundover90%ofownersareaware

ofRetrainingofRacehorses(RoR).RoRisdeveloping

astrategytoimprovethewelfareofex-racehorses

throughengagementwithindustrystakeholders.

The Horse Comes First

Communicatingandpromotingracing’shighstandards

ofequinewelfareremainsapriority.Thesport’scross-

industryHorseComesFirstCampaigncontinuedto

showcasetheoutstandingcarethatracehorsesreceive,

bothonandofftheracecourse.Ashortfilmwasunveiled

ontheeveofRoyalAscot,providingaglimpseoflife

atSomervilleLodge,hometoleadingtrainerWilliam

Haggas.Williamandhisteamtookusonatourofworld

classfacilities,featuringsolariums,watertreadmills

and24/7veterinarycare,demonstratingthatracehorses

reallydoreceiveTheRoyalTreatment.

2928

STRATEGIC REPORT

Previous Stewarding Model:

RACEDAY PANEL

Stipendiary Steward

Stipendiary Steward

Honorary Steward

(Chairperson)

Honorary Steward(Winger)

Stewards’ Secretary

New Stewarding Model:

RACEDAY PANEL

BHA ChiefSteward•BHAemployee

•Mostseniorofficial

•Overallcontrolofracedayfunctions

•Explaindecisions

•Escalationpoint

BHASteward•BHAemployee

•Traditionaldutiesofstipendiarysteward

Stewards’Panel Chair•Voluntaryrole

•Chairofenquiries

•Ensureproceduralfairness

•Objectivechallengeandendorsement

BHA AssistantSteward•BHAemployee

•Enhancedversionofcurrentstewards’secretaryrole

BHA RacedayAssistant•BHAemployee

•Multi-skilledrole

•Assistswithavarietyofracedayregulatoryduties

KEEPING RACING FAIR AND CLEAN

Likeallleadingsports,Britishracingneedstoapplythehigheststandardsofregulationandfairness,toensurealevelplayingfieldforparticipantsandtomaintainpublicconfidence.Wedonotsimplysetandenforcetherules;wealsosupportparticipantsthroughimprovededucationandtrainingandgreateraccessibilityandtransparency.

Enhanced Regulation and Integrity Processes

Theevolutionofourrisk-basedframework,whichwill

assistustoprioritisethefocusofourintegrityfunctions,

continued.Asanexample,in2018theFastTracksystem

ofprosecutingcaseswasfullyembeddedandnowdeals

withmorethan40%ofallcases,savingtimeandmoney

foreveryoneinvolved.

New Stewarding structure

In2018,followinganextensiveconsultationprocess,

theBHABoarddeterminedthatanewmodelwouldbe

appliedtotheStewardingstructureforBritishRacing.

Thenewstructureisintendedtoimprovestandards

ofofficiating,increaseconsistency,transparencyand

accountabilityandtoalignBritishracingwithother

sportingbodiesandracingjurisdictions,whilstalso

respectingandutilisingthehistory,traditionand

significantexpertiseofthecurrentmodel.

Thenewstructurerevolvesaroundtheapproachthat

racedayofficiatingshouldworkas“oneteam”with

consistentstandards,expertiseandprofessional

development,whileretainingtheabilityforobjective

challengeandendorsementofdecisions.

Key features of the new model are:

• “Oneteam”–aprogrammeofprofessional

developmentofstewardingexpertiseamongstboth

newandexistingstewards(bothBHAandvolunteer

stewards)

• Theintroductionofanew“ChiefSteward”role.This

willbeaprofessionalBHAemployeewhichhasoverall

controlofracedayregulatoryfunctionsandwill

provideclearaccountabilityandanescalationpoint

forracedaydecisions

• Voluntarystewardstofulfiltheroleof“Stewards’

PanelChair”withresponsibilityforchairingstewards

enquiriesandensuringproceduralfairness

• Additionofamulti-skilled“BHARacedayAssistant”

toensurethatthestewardingteamisbetterjoined

upwithotherracedayfunctions

AStewardsConsultationForum,facilitatedby

broadcasterandjournalistLydiaHislop,wasformedin

December,toactasaconduitbetweenmembersofthe

BHA’sstewardingteamsandtheBHAExecutiveand

Board,givingfeedbackonthecontinuingimplementation

anddevelopmentoftheStewardingReview.

Thenewmodelwasintroducedon1January2019,

withafocusonimprovingstandardsthrougha

competency-basedtrainingandprofessional

developmentprogramme.

3130

STRATEGIC REPORT

Increased transparency

Wearecontinuingtoimprovetheavailabilityof

informationrelatingtothehorse,toapplygreater

transparency.Forexample:

• Itisnowarequirementthatinformationrelatingto

windsurgeryoperationsispublishedinracecards

• The@BHAStewardsaccountwaslaunched,which

communicatesinformationandupdatesfromthe

stewards’roomdirecttosocialmediaaudiences

InputsfromgroupssuchastheHorseracingBettors

Forumareassistingourwork,withfurtheritemsin

discussionanddevelopment.

Improved equine identification processes

InMarch2018,secondaryscanningprocedureswere

introducedatracecourses,wherebyhorses’microchips

arescanneduponleavingthestablesbeforearace.

Theprocessrequiresarace-specificidentitycheck.

Scanningdevicesnowlinktheidentityofanyhorseto

therunnerslistfortheraceforwhichitisbeing

scanned.Ifthewronghorseisbroughtout,analert

withinthetechnologyistriggered,minimisingtherisk

ofhumanerror.

Enhanced Anti-Doping Programme

Furtherenhancementstothepaperlesssampling

applicationcontinuedin2018,withthetoolnowbeing

usedforallformsofracedaytesting.Therequirement

tonotifyafoalwithin30daysofbirthcameintoeffect

fromthecommencementofthe2018breedingseason,

withindustrysupportveryhigh.Horsesnotnotified

withinthespecifiedperiodarenowrequiredtosubmit

fortestingtoensuretransparencyandcompliancefor

welfareandanti-dopingreasons.

InSeptember2018theBHAintroducedapolicyof

testingthefirstfourplacedhorsesinallGroup1,2&

3FlatracesandallGrade1Jumpraces.Thisaligns

withinternationalbestpracticeandhelpstoensurethe

integrityoftheInternationalPattern.

Aconsultationandreviewwasundertakenduring

theyeartoconsiderimprovementstotheEquine

Anti-DopingRules,withreformstobeintroducedin

2019.Thesereformswillensurefairness,whilststill

protectingtheimportantprincipleofstrictliabilitywhere

cheatingisfoundtohaveoccurred.

Ensure appropriate communication of policies and

procedures with participants

AnextensiveconsultationandreviewoftheRulesof

Racingtookplacein2018,withtheaimofsimplifying

therulesintoamoreuser-friendlyframework,with

supportingresources.In2019thisprojectwillbe

deliveredwithaccessiblee-basedtools,foreasier

navigationoftheRulesofRacing.

ThedevelopmentoftheBHAIntegrityEducation

Programmecontinuedthrough2018andhasalready

beenlaunchedin2019.Wearedevelopinganeducation

programmeforourparticipants,relatingtointegrity

issues,suchasdrugs,bettingandwelfare.Notonly

willthisreduceaccidentalorunintentionalbreaches

ofourrules,itwillalsogiveincreasedconfidenceto

thepublicandallowBHAresourcestobefocusedon

moreseriousthreats.

New appointments

AnumberofchangesweremadetotheBHA’sIntegrity

functionin2018.BrantDunsheawasappointedtothe

roleofChiefRegulatoryOfficerinApril.Brant’sprevious

roleasDirectorofIntegrityandRegulationwasfilledin

NovemberwiththeappointmentofTimNaylor.

2018 ANNUAL INTEGRITY SURVEY

In2018,theBHAusedComRestoconducttheannual

IntegritySurvey.Morespecifically,the2018survey

aimedtomeasureanychangesinperceptionand

confidencelevelsrelatingtotheBHAandhowitkeeps

racingfairandclean.Theresultsfromthe2018survey

werebenchmarkedandcomparedagainsttheresults

ofthe2017survey,thefirstyearinwhichtheresearch

wasconducted.

TheIntegritySurveywasconductedonlineand1,984

responseswerereceivedacrossarangeofstakeholder

types:owners,breeders,trainers,jockeysandjockeys’

agents,media,racecourses,betting,point-to-pointand

racingfans.

Perceptions of BHA

• 79%ofstakeholdersbelievetheBHAperformswellas

thegoverningandregulatorybodyofBritishracing

• 82%ofstakeholdersareconfidentthatBritishracing

isrunwithintegrity

• FamiliarityofstakeholderswiththeworkoftheBHA

anditsintegrityteamshasincreasedsignificantly

since2017.Thisincreaseismostapparentamong

Jockeysandjockeys’agents.

• TrainersandJockeysandjockeys’agentsbelievedthe

integrityofBritishracinghadgotbetterduringthe

previous12months.

Points of action

• LackoffamiliaritywithJudicialPanelanddeclinein

confidenceofitsindependence.

3332

STRATEGIC REPORT

KEY FINDINGS

BHAperformanceagainstobjectivesisbroadlypositive

(allslightlyupon2017figureswhichwerenotpublishedinthereport).

AmajoritybelievetheBHAiseffectiveonallintegrityperformancemeasurestested

(overallupbyonepoint,thesewerepublishedinlastyear’sreport).

Percentagefiguresroundedupordowntothenearestwholenumber

Toprioritisethewelfare

ofhorses+3

+2

+3

+3

+1

Percentage point change in

NET: Excellence since 2017

Tokeepracingfairandclean

Tolookafterthepeoplewhoworkinracing

ToworkwithotherstogrowBritishracing

Todelivercompetativeand

compellingracing

Perfomance measure NET: Excellent

Toprioritisethewelfareofhorses 63%

Tokeepracingfairandclean 50%

Todelivercompetitiveandcompellingracing 42%

Tolookafterthepeoplewhoworkinracing 37%

ToworkwithotherstogrowBritishracing 33%

46% 8% 13%33%

47% 8% 9%37%

7%48% 342%

45%41%50%

4330%63%

NET: Excellent(8-10) NET: Neither poor nor excellent(4-7) NET: Poor(1-3) Don’t know

3534

STRATEGIC REPORT

JUDICIAL PANEL

TheindependentJudicialPanelplaysavitalroleinupholdingtheintegrityofhorseracinginBritain.TheBHAappoints

theJudicialPanelChairtoleadandoverseetheactivitiesoftheJudicialPanel.TheJudicialPanelChairandthe

membersoftheJudicialPanelareremuneratedbytheBHA,butactentirelyindependentlyoftheBHA.

Chairmen

BrianBarkerC.B.E.QC HisHonourBrianBarkerhashadadistinguishedcareerintheJudiciary,includingservingastheRecorderofLondon–theseniorJudgeattheOldBailey–andasaJudgeoftheCourtofAppeal.Heardthesecond“Deepcut”inquestintothedeathofCherylJamesandcurrentlyholdsanumberofsenior,part-timeappointments,includingIndependentReviewerofNationalSecurityinNorthernIreland,andAssistantSurveillanceCommissioner.

TimCharltonQC WasachairmanoftheformerDisciplinaryPanelfrom2005.

HisHonourPhilipCurl AretiredCircuitJudgeand,from2002,astewardatracecourseswhichincludeNewmarketandYarmouth,nowretired.WasamemberandsubsequentchairmanoftheformerDisciplinaryPanelsince2011.

DavidFishQC Queen’sCounselpractisinginManchesterandformanyyearsanowner,withacomprehensiveknowledgeofhorseracing.

PatrickMilmoQC Queen’sCounselpractisinginLondon,wasachairmanoftheformerDisciplinaryPanelandalong-standingownerandbreeder.

JStuartMorrison AretiredsolicitorwhopractisedinScotland,andaformerimmigrationjudge,fromwhichheretiredinMarch2015aftercompleting15yearsofservice.Aprolificownersince1990whohasenjoyedGroup1success.Wasatonetimeinpartnershipinabookmakingbusiness.Anon-executivedirectorofAyrRacecourse.

WilliamNorrisQC Apractisingbarristerandformeramateurrider.PastchairmanoftheformerBHADisciplinaryPanel,oneofthecurrentchairmenofSportResolutionsGeneralPanel,theNationalAnti-DopingPanel,FAIndependentPanelandIAAFPanel.TrusteeoftheInjuredJockeysFund.

HisHonourJamesO’Mahony ACircuitJudgeinKentwithawideknowledgeofhorseracing.

Wingers

DavidAdam AformerSteward,from1988to2014,atc.10racecoursesincludingEpsom,GoodwoodandSandownPark,andanowner.

TonyConnell AretiredseniorlawyerattheCrownProsecutionServiceandamemberofseveralracecourseswithacomprehensiveknowledgeofhorseracing.

EdwardDorrell PreviouslyamemberoftheformerDisciplinaryPanelandtheLicensingCommitteeandhasrecentlyretiredfromStewardingresponsibilitiesatsixracecoursesincludingChesterandHaydock.

JohnDyer AbarristerpractisinginLondonandanowner,withastrongknowledgeofhorseracing.

ChloeFairley AbarristerpractisinginLeedswhorodethewinneroftheMacMillancharityraceforamateursatYorkin2014.

JodieMogford Aformerjockeywhorodec.170winnersunderNationalHuntRules.JodieiscurrentlyassistanttrainertoGraemeMcPhersonQCandwillthereforenotsitonanycaseswhichinvolvealicensedtrainerwhoispersonallyallegedtobeinbreachoftheRulesofRacingorwhereGraemeMcPhersonisactingforeitherparty.

JennyPitman,OBE AformertrainerwhotrainedwinnersofboththeGrandNationalandtheCheltenhamGoldCup(eachtwice).

DianaPowles WasamemberoftheformerDisciplinaryPanelandanowretiredStewardwhohasactedsince1998atseveralracecoursesincludingNewmarket,SouthwellandDoncaster.

SteveWinfield Anowner,breederanddevoteeofhorseracing,withwideknowledge,andwhohasextensiveregulatoryanddisciplinaryexperience.WasformerlytheChairmanoftheGreyhoundRegulatoryBoard.

YvonneMee RetiredBHAStableInspector.Over40years’experienceinthehorseracingindustryincludingbeinganamateurrider,assistanttrainerandholderofapermittotrain.

DrLynGriffiths FormerlyaRacecourseMedicalOfficerovermanyyears.Aseniormedico-legaladviserfortheMedicalProtectionSociety

JohndeMoraville AretiredBHAHandicapperfrom2004–2015.Previouslyracingjournalistandfrom1974–2004freelancewithBBCTVracing,assistingproducerswithexpertadviceandinformation.ActedasPeterO’Sullivan’sracereaderatCheltenham,Aintree,RoyalAscotandnumerousotherbigmeetings.

3736

STRATEGIC REPORT

STEWARDS’ ENQUIRIES ANTI-DOPING

DISCIPLINARY PANEL CASES

INVESTIGATIONS

2017 2018

Interference(inbreach) 810(592) 812(605)

Whip(inbreach) 524(524) 535(535)

RunningandRiding(inbreach) 150(34) 159(39)

TotalNo.SamplesConducted

Human 2016 2017 2018

Raceday–Breath 2080 1935 1894

Raceday–Urine 436 421 516

OutofCompetition–Urine 8 10 5

OutofCompetition–Other 0 1 0

RacingSchool–Urine 37 14 0

TotalNo.TestsConducted

Equine 2016 2017 2018

Raceday-Total 8690 9123 9909

OutofCompetition-Total 1846 2303 2535

Total 10536 11426 12444

TotalNo.AdverseAnalyticalFindings

Human 2016 2017 2018

Raceday–Breath 1 3 3

Raceday–Urine 2 2 1

OutofCompetition–Urine 0 0 0

OutofCompetition–Other 0 1 0

RacingSchool–Urine 0 0 0

Total 3 6 4

AdverseAnalyticalFindingsas%SamplesConducted

Human 2016 2017 2018

Raceday–Breath 0.05% 0.16% 0.16%

Raceday–Urine 0.46% 0.48% 0.19%

OutofCompetition–Urine 0.00% 0.00% 0.00%

OutofCompetition–Other N/A 100.00% N/A

RacingSchool–Urine 0.00% 0.00% N/A

2017 2018

ExclusionorderbytheDisciplinaryOfficer 5 6

ExclusionfollowingDisciplinaryhearing 1 0

SuspendedfollowingDisciplinaryhearing 0 2

DisqualificationfollowingDisciplinaryhearings 4 1

Disqualificationfordebts/arrears 28 7

Total exclusions/disqualifications 38 16

Appealsfromracecourse 15 21

Referralsfromracecourse 10 20

OtherDisciplinarycases(includingfast-track) 56 52

CompliancecasesfromIntegrity 3 6

Total 84 99

AppealsBoard 2 1

2017 2018

Intelligence 3,392 2,141

Investigationsopened 104 80

Investigationsclosed 105 57

*OutofCompetitionincludesBritishBased,InternationalRunners,PermanentImport&SalesTesting)

3938

STRATEGIC REPORT

ANTI-DOPING

Raceday Total No. Samples Conducted

Equine Pre-Race Post-Race Misc Total

Urine 53 7999 19 8071

Blood 970 964 22 1956

Hair 0 0 0 0

Total Samples 1023 8963 41 10027

OutofCompetitionTotalNo.SamplesConducted

Equine Sales (AAS)

British Based

Perm. Import

Intl. Runner

GB Bred Foal

Stalls Test Total

Urine 0 37 0 0 0 0 37

Blood 541 1390 523 18 18 29 2519

Hair 0 14 99 18 18 0 149

Total Samples 541 1441 622 36 36 29 2705

*OOCincludesBritishBased,InternationalRunners,PermanentImport&SalesTesting)

TotalNo.AdverseAnalyticalFindings

Equine 2016 2017 2018

Raceday-Total 21 16 17

Raceday-%Tests 0.24% 0.18% 0.17%

Out of Competition - Total 0 0 0

OutofCompetition-%Tests 0.00% 0.00% 0.00%

2019AdverseAnalyticalFindingsbyType

Equine Total No. % AAF

Androgenic-anabolicsteroids 1 0.01%

Beta-blocker 2 0.02%

NSAID 3 0.03%

Opioids 2 0.02%

Cobalt 1 0.01%

Other 8 0.08%

Total 17 0.17%

4140

STRATEGIC REPORT

GROWING BRITISH RACING TOGETHER

Britain’simminentexitfromtheEuropeanUnionwillbringthemostsignificantchangetothepoliticalandeconomiclandscapeinnearly50years.Inthispotentiallydisruptivecontext,itisvitalthattheBHAanditsstakeholdersprovideleadershipforthesport.WearealreadyworkingtogethertodeveloptheBHA’sgovernance,aswellascontinuingtoassesschangeslinkedtocontinuingreformoftheLevyandtheimpactofchangesinthebettingandgamblinglandscape.

Brexit

Asignificantamountofworkwascarriedoutunder

theauspicesoftheThoroughbredBrexitSteering

Group,withtheBHAplayingaleadrole,alongsidethe

ThoroughbredBreeders’AssociationandWeatherbys.

Thechallenges–andopportunities–presentedbythe

UK’splanneddeparturefromtheEuropeanUnionfall

principallyintotheareasofhorsemovement,associated

policiesaroundhorsehealth,welfareanddisease

surveillance,andfutureimmigrationpolicy.Detailed

submissionsweredevelopedandpresentedtopolicy-

makerswithintheUKGovernmentandtheEuropean

Commissionasappropriate,thelatterthroughthe

EuropeanandMediterraneanHorseracingFederation.

Ourindustryhasenjoyedstrongsupportinparticular

fromtheDepartmentfortheEnvironment,Foodand

RuralAffairs,includingonthenecessarypreparation

fora‘nodeal’Brexit,andtheUKGovernmentcommitted

tothecontinuationofexistingfreemovementof

thoroughbredscomingintotheUKfromIrelandand

FranceundertheestablishedandsuccessfulTripartite

Agreementinsuchascenario.

SirHughRobertsonwasappointedasChairofthe

RacingAuthorityinJanuary2018,andtheorganisation

operatedinshadowformthroughouttheyear,withtwo

DirectorsappointedbytheBHA,andwidersupport

providedbyBHAExecutives.Unfortunately,latein2018

theLegislativeReformOrderasproposedprovedunable

tosatisfytheconcernsoftheParliamentaryCommittees

scrutinisingthelegislationdesignedtobringinthe

changesandformalisetheRacingAuthority’srole–

notonthepolicycontainedwithinitbutonprocedural

grounds–andthelegislationwasdiscontinued.Work

continueswiththeDepartmentforDigital,Culture,

Media&Sport,andtheHorseraceBettingLevyBoardon

modernisationofexistingstructures.

Gambling Review

TheconclusionsoftheGovernment’sGamblingReview

wereannouncedinMay2018,withconsiderablemedia

coverageofthedecisiontoreducethemaximumstake

onCategoryB2gamingmachines(socalledFOBTs)

to£2.

TheBHA,onbehalfofthewholesport,hadargued

stronglythattherewasaneedforastrengthening

ofmeasurestoreducetheharmcausedbyproblem

gamblingbutalsothattherewasaspecialand

longstandingrelationshipbetweenthebettingand

horseracingindustries,withsignificantrevenuesin

thesportdependentonasustainable,andsocially

responsible,bettingsector.Whilstaperiodoftransition

wascommittedto,inevitableclosuresofbettingshops

willaffectBritishracing’sincome,predominantly

throughmediarights.

Plansareunderwaytobestminimisethisimpact,

bothwithinthesportitselfandthroughongoing

representationstoGovernment,basedontheneedto

maintainourinternationalcompetitiveness,andour

capacityforfurthergrowthinourcontributiontothe

economyandsociety,particularlyinruralareas.

Racing Futures

Across-industryprojectgotunderwayin2018to

defineracing’svision,valuesandpurpose,withaview

toidentifyingthethingsthatbestdefineandunitethe

sport.Theprojectengagedanexternalconsultancyto

facilitatearangeofworkshopsanddiscussionswith

racing’sstakeholdersandconsumers.Theworkisbeing

furtherdevelopedin2019,withaviewtoproducingand

engagingthesportinRacing’s Story,acommonnarrative

thatcanbeusedtopitchthethrillandpassionofracing

toarangeofdifferentaudiences.

Racing Administration

Throughout2018,wehavebeenworkingonthecreation

oftheracingadministrationservicesthat,togetherwith

ourpartnersatWeatherbys,weprovidetothesport.

Theseservicesareusedpredominantlybyracehorse

owners,thesport’sparticipants,andracecourses,

andplayacentralroleingovernance,regulation,

integrityandwelfarematters.Thevisionforthisdigital

transformationisbasedonfourunderlyingprinciples:

• Toputthecustomeratthecentreofracing

administration

• Tocreateatechnologyplatformthatrespondsfasterto

theneedsofcustomersandthewidersport

• Todriveefficiencygainsbyimprovingexisting

processes

• Touseracingdatainamoreintelligentwayincluding

theprovisionofenhancedinsighttoguidedecision-

making

Animplementationplanwillbecreatedduring2019with

aviewtodeliveringtheseimprovementsattheearliest

opportunity.

Racing Authority/Levy Board

Considerableresourcewasdevotedtotheestablishment

oftheRacingAuthority,whichwasintendedtotake

overtheHorseraceBettingLevyBoard’sdistribution

functionaspartofstatedGovernmentpolicyandthe

nextphaseofLevyreformfollowingthe2017legislative

changetoextendtheLevycollectionbasetooffshore

remoteoperators.

4342

STRATEGIC REPORT

COMPETITIVE AND COMPELLING RACING

ThecontinuedsuccessofBritishracingispartlydependentontheexistenceofacompelling,innovativeandvariedracingprogramme,stagedatcustomer-friendlytimes,whilstalsotakingintoaccounttheimpactonthosethatserviceit.Theprogrammemustalsomatchtherequirementsofthehorsepopulation,providingopportunitiesforhorsestoprogressandtofulfiltheirpotential.

Handicapping

AreviewoftheBHA’shandicappingfunctionwas

completedduring2017bybroadcasterandjournalist

LydiaHislop.UndertheleadershipofDominicGardiner-

Hill,whosucceededPhilSmithasHeadofHandicapping

inJune2018,mostofthereview’srecommendations

havebeenimplemented.Theseincluded:

Publication of a new Guide to Handicapping–Arevamped

‘GuidetoHandicapping’sitsonanewlydesigned

handicappingsectionoftheBHAwebsite.Theguide

hasbeenwrittenbothwithparticipantsandthegeneral

publicinmind,andaimstobeeasiertounderstand,

moreaccessibleandtoexplainanypotentially

contentiousareasofhandicappingpolicy.Theguidealso

setsouttheaimsofhandicapping,whichhavebeenre-

writtenaspartofthereview.

Independent Appeals Process and Panel–Anew

onlinehandicappingappealsprocess,carriedoutby

anindependentexternalpanelofexperts,ensuring

allappealsareheardfairlyandindependently,whilst

followingdueprocess,hasbeenintroduced.

Flat Penalty Structure–Amorenuancedpenalty

structureforwinnersbasedonageisnowbeing

employed.Assuch,penaltiesforhandicapwinnersaged

twoandthreeis6lb,thoseagedfourtosixwillbe5lband

thoseagedsevenandabovewillbe4lb.Thisapproach

wasdevelopedfollowingdetaileddataanalysis,including

theaverageratingsriseofhorseswinninghandicaps,

andwasapprovedbytheindustry’sRacingGroup.

Enhanced data analysis–Oneoftherecommendations

oftheoriginalreviewwastopromoteamorerigorous,

data-drivenapproachtohandicappingpractices,with

muchofthisworktobepublishedonthehandicapping

sectionoftheBHAwebsiteaspartofthecommitmentto

amoreopenandtransparentapproachtohandicapping.

Further recommendations –Otherrecommendations

thathavebeenimplementedincludeperformance

figuresbeingpublishedontheBHAwebsitefor

allracesexceptmaidenandnoviceevents.Also,

increaseddiversityhasbeenintroducedintotherace

programmecourtesyofthe10-raceoptionalclaiming

handicaptrial,discussedbelow.TheBHAHandicapping

Teamhasundergoneaninternalrestructureto

increaseaccountability.

Supporting lower and middle-tier racing

In2017theBHA,RCAandHorsemen’sGroupagreedafundingpackagefor2018andbeyond,intendedtosupport

grassrootsracing.Thisincludedincreasedcentralpaymentstolowergraderacesthroughbothprizemoneyand,

forthefirsttime,acentralappearancemoneyschemelinkedtoarequirementforracecoursestoinvestmoreinthis

sectionoftheprogramme.Totalprizemoneyhasrisensince2011,withtheupperlevelsofracingbenefitingmost

fromtherises.

4544

STRATEGIC REPORT

ADDITIONAL FUNDING Fixture List

Asinpreviousyears,theFixtureListwascompiled

withtheagreedobjectivesof:

• Supportingbetting

• Increasingracecourseattendances

• Improvingparticipantwelfare

• Providingcompellingcontentforthemedia

Giventhatmostprogresshadbeenmadeinotherareas

inrecentyearsthe2019FixtureListoutcomewasalways

intendedtoprovidethegreatestfocusonparticipant

welfarewherepossible.Oneofthekeyoutcomesin

thisregardwastheintroductionoftwobreaksfromflat

racing,oneinNovemberandoneinMarch.Although

thetotalvolumeoffixtureswasunchanged,theaimwas

toprovidetwoshortwindowswhereflatparticipants

didnothavefixturestoservice.Inaddition,changes

weremadetothetimingsofallweatherracesthrough

thewinterseasonwhichsawfixturesconsistently

commenceshortlyafterthelastafternoonraceand

runthroughtonolaterthan8.30pm.Thischange

enabledthesporttoprovideanimprovedoutcometo

bookmakersandthemedia,whilstbringingtheaverage

lastracetimeatfloodlitfixturesforwardbyaround

30minutes.

PROPORTION OF PRIZE MONEY BY CLASS INCLUDING AMS, BY YEAR

AlthoughchangestoFOBTlegislationmeantthatsomechangestothisschemewerenecessary,itcontinuesinto

2019inasimilarformandwillleadtoasimilardistributionofprizemoney.

TIME OF LAST RACE GROUPED BY 15 MINUTE INTERVALS 2017/18 COMPARED TO 2018/19

1,000,000

0

10

0

5

0

10

15

2,000,000

20

Additionalperracepayments

Class1 Class2 Class3 Class4 Class5 Class6

1801

-1

815

1816

-1

830

1831

-1

845

1846

-1

900

1901

-1

915

1916

-1

930

1931

-1

945

1946

-2

000

2001

-2

015

2016

-2

030

2031

-2

045

2046

-2

100

2101

-2

115Class7

Appearancemoneyscheme

3,000,000

30

20

25

4,000,000

40 30

Tota

lspe

nt(£

’s)

Pro

port

ion

ofto

talr

ace

valu

es(%

)

Num

ber

offi

nish

es

5,000,000

6,000,000

7,000,000

3,229,200

6,154,196

2014 2015 2016 2017 2018

2017/2018 2018/2019

4746

STRATEGIC REPORT

Race Planning

Oneofthemostsignificantchangestoraceplanning

practicesthisyearhasbeenatrialofopenentriesand

declarations.Withtheprevioussystempreventing

connectionshavingvisibilityofwhichotherhorses

werebeingdeclaredforraces,itwasfeltthatamore

transparentsystemwouldbebeneficial.Thistrial

initiallyranontheflatfromDecembertoFebruaryand

alsoremovedthepreviouspracticeofre-openingraces

atentrystageandre-offeringatdeclarationstage,

therebystreamliningtheprocessformakinginformation

availabletothepublic.Trainerfeedbackwaspositiveand

thetrialwasextendedandisstillongoing.Ithasalso

beenappliedtojumpracing.

Asnotedabove,furtherinnovationsawanewrace

typeappearforthefirsttimeintheformofOptional

ClaimingHandicaps.Theserelativelyvaluablehandicaps

seetrainersabletoelecttoreduceweightcarriedin

exchangeformakingtheirhorseavailabletoclaimand

areintendedtoprovideoptionsasanalternativefor

horses,aswellasstimulatingtradeinabracketofthe

populationwhereitmaynototherwiseexist.Tentrial

raceswerestagedanditistheintenttocontinuewith

thetrialin2019.

WealsomadechangestotheNorthernLightsseries

whichsawthefinalsmovefromearlyDecemberinto

March,toformpartofanewlycreatedNorthernJump

featureweekendbetweenCheltenhamandAintree.

ThiswilltakeplaceforthefirsttimeinMarch2020.

Otherinitiativesincludeanagreementtoreducethe

commissionchargedbyracecoursesonhorsessoldout

ofsellers,refinementstotheflatNoviceprogramme,

48-hourdeclarationsforallracesatCheltenhamand

ongoingsupportoftheflatstayersprojectfromtheBHA

Developmentfund.

High value novices’ events

2018sawtheintroductionoftwohighvaluenovices’

events,supportedbytheBHADevelopmentFund,with

aviewtoaddressingspecificissuesidentifiedwithinthe

Jumpprogramme.

Thefirstrace,designedtosupportthefindingsof

theBHA’sNovices’SteepleChasereview,wasaimed

atdecentstayingnovicechasers,whichhadbeen

campaignedinweight-for-ageeventsandperhaps

foundthemselvescomingupjustshortoftopclass.The

£100,000racewasheldatAyronScottishNationalDay

andattractedaqualityfieldof9.

Thesecondrace,a£100,000,2-mileNovices’Handicap

HurdleFinal,wasdesignedtoattractex-Flathorses,

aswellasthetraditionalNHbredhorses,inorderto

providesomeincentivetosendex-Flathorseshurdling.

HeldatSandownParkonthelastdayoftheseason,the

firstrenewalsawahigh-qualityfieldof15runners,led

homebythefavourite,GetawayTrump.

Bothracesreceived£50,000eachfromtheBHA

DevelopmentFundandwerecontinuedagainfor2019.

4948

STRATEGIC REPORT

EUROPEAN PATTERN COMMITTEE

ContinueddevelopmentoftheframeworkthatseesBritainfurtheritspositionasthehomeofthebestracingintheworldrequiresquality,varietyandopportunityforallaspectsofthethoroughbredasitprogresses,andforthebreedonawiderbasis.

ItremainsessentialthatBritainleadsbyexample,with

theaimofachievinggreateracceptanceamongstracing

authoritiesacrossthedifferentregionsoftheglobe

toupholdthevalueofBlackType,withaconsistent

qualitativeassessmentofGroup/GradedandListed

races,andanoverallinternationalprogrammethatisfit

forpurpose.Britishracingcontinuestoattracthorses

ofthehighestcalibretoracehereandshouldstriveto

providecontinuedincentiveforoverseasinvestment.

Stayers

Significantprogresscontinuedduring2018onthe

industry-wideprojecttosafeguardthefutureofthe

stayinghorseontheFlat.TheBHAillustratedits

ongoingcommitmenttoprotectingandenhancing

theprogrammedesignedtoattract-andencouragethe

developmentof-qualityhorseswithanaptitude

forstamina.

Theimprovedprogrammeforstayerswas

complementedbytheinauguralofferingofa£1mBonus

fromWeatherbysHamilton,availabletothehorsewho

couldwintheGoldCupatRoyalAscot,followedbythe

GoodwoodCupandtheLonsdaleCupatYork(having

alreadywononeoffourqualifyingraces).Thisfeatwas

consideredbymanytobehighlyunlikelytobeachieved,

giventhatithadneverbeendonebefore.However,

theextraordinary2018performancesofStradivarius

(IRE),ownedbyBjornNielsen,trainedbyJohnGosden

andriddenbyFrankieDettoriatRoyalAscotandYork

andbyAndreaAtzeniatGloriousGoodwood,sawhim

dulycrownedthewinnerofthefirst£1mWeatherbys

HamiltonStayers’Bonus.

Followingthesignificantfinancialcontributiontothe

stayers’programmefromtheBHA’sDevelopmentFund

for2018,withfundsmainlybeingutilisedtocreatea

progressiveprogrammeforthethree-year-oldstayer,

renewedfocusshiftedtoboostingtheprogrammefor

stayingfilliesandmares,agoalwhichwassupported

bytheEuropeanPatternCommittee(EPC).TheEPC

announcedafurthertrancheofenhancementstothe

PatternandListedraceprogrammeforstayersin2018,

alongwithanumberofotherchangeswithintheBlack

Typeprogramme.

WORLD CLASS RACING ThefollowingBritishraceswerethesubjectofapprovedchanges,announcedbytheEPCandtheBHA:

Jump Pattern Upgrades

InOctober,theJumpPatternCommitteeannouncedanumberofupgradestotheBritishJumpPatternand

Listedraceprogrammeforthe2018/19season.Theprincipalchangesrelatedtotheongoingprojecttodevelop

themares’BlackTypeprogramme,andtherebythepopulationofJumpingmares.Thisremainsalong-term

BHAproject,withtheaimbeingtodelivergraduatedgrowthintheprogrammeinordertoprovidesufficient

incentivetoenactbehaviouralchangeinbreeders,buyers,owners,trainersandracecourses,suchthatmore

maresareputintotrainingandgiventhechancetodeveloptothebestoftheirabilityontheracecourse,before

perhapsbecomingbroodmares.

Upgraded races:

Jump Pattern Committee:AdrianGrazebrook(Chairman),EdArkell,RichardAston,AnthonyBromley,DavidCleary,

SamHoskins,PhilipHobbs,EmmaLavelle,SteveMellish,PaulNicholls,RichardNorris,RuthQuinn

Flat Pattern Committee:AdrianGrazebrook(Chairman),AndrewBalding,AndyClifton,SimonCrisford,Philip

Freedman,WilliamHaggas,LydiaHislop,RuthQuinn,JulianRichmond-Watson,AmandaSkiffington,NickSmith,

NicholasWrigley

Name Venue DateDistance

&AgePrevious

statusNewstatus

BlueRibandTrial EpsomDowns 25April 10f3yo Class2 Listed

Huxley Chester 11May 10f4yo+ Group3 Group2

BrontëCup York 26May 14f4yo+fillies Newrace Group3

QueenCharlotteChelmsford

City20June 7f4yo+fillies Newrace Listed

Hoppings Newcastle 29June 10f3yo+fillies Listed Group3

SilverCup York 14July 14f3yo+ ListedGroup3and

changedto4+

LillieLangtry Goodwood 2August 14f3yo+fillies Group3 Group2

March Goodwood 25August 14f3yo Listed Group3

Name Venue DateDistance

&AgePrevious

statusNewstatus

Fillies’JuvenileHurdleRace Doncaster 25January2m½f4yo

filliesNewrace Listed

Mares’SteepleChase Exeter 10February3m5yo+

maresNewrace Listed

JuniorJumpersFillies’JuvenileHandicapHurdleRace

Cheltenham 18April2m½f4yo

filliesClass2 Grade3

STRADIVARIUS

5150

STRATEGIC REPORT

Thesport’sdutyofcaretoitsemployeesrangesfromsafeguardingandwelfareprovisions,totraining,educationandcareerpathwaysateverylevel.Wearedependentonthepassionanddedicationofthepeoplewhocareforourhorses.Weareredoublingoureffortstorecruit,trainandretainaworkforcethatdrivesthegrowthofBritishracing’srelevance,revenuesandreputation.

Racing recruitment

Thecareersinracingbrandedmarketingcampaign

continuestouseabroadrangeofcommunication

channels.Digitalmarketingisanareaofincreasing

importanceandgrowthfortargetingtheyouthaudience,

inparticularforstudentrecruitmenttothetraining

providers.Acomprehensiveresearchprojecttook

placetoevaluateandunderstandthedigitalexperience

ofpotentialstudentprospects.Learningsfromthiswill

shapefuturedevelopmentprojectsanddigitalcontent.

Careersinracing.compromotedviabrandedand

paid-fordigitalmarketingcampaignscontinuedtosee

growth,witha20%yearonyearincreaseinwebsite

usersessions,andanincreaseof9%injobseekers

registeredonthejobboard.Therangeofrolesonoffer

inracingiswellarticulatedthroughthecareersinracing

jobboard,whichcontinuestobeavailableforfreetoall

racingemployers.

Assetsofnotecreatedin2018includeaWelcomeVideo

incollaborationwiththeNTF,afullyinteractiveCareer

Map-mappingover40roles,WorkExperienceToolkits

and“Howto”Videoguides.Abroadrangingcareersvideo

showcasingthemultipleroleswithin‘TeamRacing’-has

beenviewedover172Ktimesandcontinuestodirect

audiencestothemultitudeofavailableopportunities.

Eventsandactivitiesincludedfourlargerecruitment

events,10innercityjobfairs,nineracecourseevents

andbrandedactivityalongsidethePonyRacing

Authority,NationalCareersWeek,andRacingto

School’sRidersProgramme.Thesewereeffective

indrivingenquiries,asmeasuredbygrowthinthe

prospectdatabasewhichnowstandsat5,500.

During2018therewereatotalof1,517newjoinersto

thestablestaffregister.Increaseinnewjoinersover

thelastfiveyearshasgrown38%.

CAREERSINRACING

Digital Marketing

Campaign highlights

Website and Job Board

Events and Sponsorship

1.9mtotalimpressionsviasocialmediaadvertising.

Continuedtodevelopourdigitalofferandcontentin2018,includingthecreationofaninteractivecareersmap

Atotalof403,368visitors

SponsoredactivitiesinpartnershipwiththePony Racing Authority, British Grooms Association, Betfair Racing Staff Week, Pony Club Championships, Badminton Horse Trials and Shetland Pony Grand National.

25events,including:The Skills Show, The Diversity Show and British Champions Day

79,637visitorstotheApprenticeshippageonthewebsite.

Key contributortoNationalCareersWeek

Numberofjobseekersregisteredforthejobboardincreasedby 9%during2018.Prospectdatabasegrewto5.5k

290,115promotionalvideoviewsthroughYouTube.

RecruitedandrananEntryintoEmploymentProgrammefor12EquineCollegestudents,allofwhomweresubsequentlyemployedintheindustry

Over1,000racingjobsprocessedandpromotedviasocialmedia

LOOKING AFTER OUR PEOPLE

5352

STRATEGIC REPORT

Public Perspectives Research

Someofthekeymessagestocomeoutoftheresearch

(March2019)included:

• Recruitment,skillsandretentionissuesareimportant

to,andcontinueimpactingon,theindustry.This

suggeststhecontinuedneedforstrategy,resources

andactiontoaddresstheissuesidentified,aswellas

monitoring,evaluationandresearchtoinformand

assesschange.

• Therehavebeennotableincreasesinyardsproviding

trainingtotheirstaffandthereareimprovementsin

staffperceptionsaroundtraining,developmentand

careerprogressionopportunities.

• Thesechangeshaveyettofilterdowninto

improvementsintrainers’perceptionsofskillsgaps

andretentionamongsttheirexistingworkforceand

staff’sjobsatisfactionandintentiontoremainworking

intheindustry.

• Themessagesfromresearcharethatworkriders,

andgrooms/ridersandyardstaffarethehardest

positionstofill.

Training

Acrosstheindustry,35,000trainingdaysweredelivered

in2018.Thecurrentplanaimstoprovide50,000training

daysperyear.

Therearecurrently35recognisedlearningprogrammes,

withanaimtoincreasethenumberto50infutureyears.

Therearecurrently22bespokeindustryqualifications.

ThenewRegionalStaffDevelopmentProgrammewill

reach2,400racingstaffoverthenextthreeyears.

Trainingiswellunderwaytoproduce119ridercoaches

fromracingyardstoimprovetheskillsofover1,000riders.

TheJockeyCoachingprogrammegoesfromstrength

tostrength.23coacheswithacombinedtotalofover

99,000ridesprovidecoachingandsupporttoallofthe

claimingjockeys.Thegoalistoextendthisservicetofull

professionaljockeysaswell.

TheBHAiscurrentlyworkingwithpartnerstodevelop

andhostanindustry-widecomprehensiveonline

LearningResourceCentre.

5554

STRATEGIC REPORT

Safeguarding

Anewindustry-wideSafeguardingPolicy,Regulations

andCodeofConductwaspublishedin2018,andcame

formallyintoeffecton1January2019.Itsobjectiveisto

enableeveryoneinracingtomanageanysafeguarding

issueswithconfidence,efficiencyandappropriate

support.ThePolicycoversareassuchasabuse,

inappropriaterelationshipsandsaferrecruitment

practices,aswellasintroducingnewprocessesforthe

reportingofsafeguardingconcerns.Everyoneworking

inracingwillbeexpectedtoadheretothePolicyand

CodeofConductandthePolicywillalsobeincorporated

intoformallicensingrequirementsandtrainingcourses

from2019.

TosupporttheimplementationoftheSafeguarding

PolicyandRegulations,anonlineaccredited

learningprogrammehasbeenlaunchedtoprovide

anIntroductiontoSafeguardingInTheHorseracing

Industry.Alllicenceholderswillberequiredtocomplete

itaspartofthe2019licencerenewalprocess.Sofar

over100participantshavecompletedtheonlinecourse

whichhasalsobeenintegratedwithexistingeducational

programmesforstablestaff,jockeysandjockey

coaches.Allnewjoinerstothesportcomingthroughthe

RacingSchools,claimingjockeysandjockeycoaches

havereceivedsafeguardingeducationin2018andthis

willbeexpandeduponin2019.

TheBHASafeguardingTeamhasbeenbolsteredby

therecruitmentofaSafeguardingOfficerwhowill

workcloselywithallkeystakeholders,withtheaim

ofembeddingsafeguardingasafunctionwithinthe

BHA,workingcloselywithIntegrityandRegulation

Departmentsinapreventativeapproachthatsupports

positiveculturaldevelopmentacrossthesport.

AspartoftheRacecourseLicensingReviewProcess,a

newSafeguardingGeneralInstructionhasbeencreated

alongwithaccompanyingguidancewhichsetsoutthe

safeguardingrequirementsforRacecoursesduetobe

introducedaspartofthe2020licensingcycle.

Diversity

Racing’scommitmenttotheimprovementofDiversity

wasstrengthenedinOctober2018,withtheappointment

ofRoseGrisselltothenewroleofHeadofDiversity

andInclusionforBritishRacing.Therolewillwork

withtheDiversityinRacingSteeringGrouptoco-

ordinatetherecommendationsoftheDiversity

&InclusionActionPlan,publishedinJuly,whilst

alsoworkingwiththewholeoftheindustrytobuild

understandingandimprovement.

TheActionPlanidentifiedeightcoreareas,whichcan

andshouldbeaddressedtopromotegreaterinclusion.

Centraltoitsrecommendationsistheneedtoreach

culturallyandethnicallydiverseaudiencesthroughthe

sport’smarketingandpromotion,andensuringthenext

generationofracingfanshastheopportunitytointeract

withhorses,particularlyinurbanenvironments.

Rider safety

Anumberofinitiativestoimproveridersafetywere

announcedduring2018.

From1October2018,theminimumacceptablestandard

forasafetyvest(bodyprotector)forraceridingfor

jockeysofalldisciplineswasincreased.Alljockeysmust

nowwearthenew“Level2”bodyprotectors,ratherthan

thecurrent“Level1”model.TheLevel2vest,which

wasintroducedfollowingconsultation,offersvastly

superiorprotectionagainstdirectblows,suchaskicks.

Theweightallowanceforsafetyequipmentwasraisedto

3lbstoreflecttheheavierweightofthenewvests.

Meanwhile,theBHA’sdigitalarchiveofpreviousrace

footage,createdin2018,isassistingmultipleresearch

projectsaimedatimprovingridersafety.Projectsbased

attheUniversityofSydney,UniversityCollegeDublin

andUniversityofBathareallusingthedigitalrace

archivetomapanddigitallyreconstructhowjockeys

fall.Itishopedthatthevariousprojectswillimprove

understandingoftheimpactoffallsonconcussion

andspinalinjury,whichmayinturninfluencefuture

equipmentdesign,andjockeytraining.

Godolphin Stud and Stable Staff Awards

TheBHAhostedthe14thannualawardsto

celebratetheverybestoftheindustry’sstudand

stablestaff.Theawardsaregenerouslysponsored

byGodolphin,inassociationwiththeRacing

Post.The2018awardswerehostedbyITV’sEd

Chamberlin,alongsideguestpresenterMichael

Owen,whopresentedthe2018Employeeofthe

YearAwardtoJessicaMcLernon,AssistantTrainer

atRichardFahey’sMusleyBankStables.

The winners:

EMPLOYEEOFTHEYEAR

JessicaMcLernon

LEADERSHIPAWARD

JessicaMcLernon(RichardFahey)

RIDER/GROOMAWARD

PetraSebestikova(LucaCumani)

STUDSTAFFAWARD

SarahTaylor(MickleyStud)

DEDICATIONTORACINGAWARD

WilliamReddy(EveJohnsonHoughton)

DAVIDNICHOLSONNEWCOMERAWARD

AdrianStewart(DavidLoughnane)

RORYMACDONALDCOMMUNITYAWARD

John&JackiePorter(ex.InjuredJockeys’Fund)

JESSICA MCLERNON EMPLOYEE OF THE YEAR

5756

DIRECTORS’ REPORT AND GOVERNANCE STATEMENT

Sportsgovernanceremainedamajortopicin2018,withtheBHA’sowngovernanceasignificantareaofdiscussion.

Governanceinsportremainedunderscrutinyin2018.

TheBHAhascontinueditscommitmenttoachieving

compliancewiththehighestlevel(tier3)ofUKSport’s

CodeforSportsGovernance,notwithstandingthatthe

BHAisnotpubliclyfunded.Thisambitionreflectsthe

BHA’suniquesetofregulatoryresponsibilities;including

maximisingthewelfareofthesport’shorsesand

people,keepingracingassafeaspossibleforhorses

andjockeys,andensuringthesportisfairandfree

fromcorruption.

InJanuary2018,Slaughter&Maypresentedtothe

BoardanindependentreviewoftheBHA’scorporate

governance.TheBoardandtheBHA’smembers

heldconstructivediscussionsregardingthe

recommendationsthroughout2018.Anumberof

therecommendationshavebeenimplemented;others

theBHABoardhasdecidednottoimplementatthis

time;andsomeremainunderconsideration.

FollowingfromtheSlaughter&Mayreview,theBHA’s

membersalsocarriedoutareviewoftheBHA’sroleand

remit,andoftheoperationoftheMembers’Agreement,

during2018,whichisongoing.Theobjectiveofthe

members’reviewistoincreaseindustryinvolvement

inkeydecisionswhichaffectthesport,whileretaining

theindependenceoftheBHABoardonregulatoryand

integritymatters.

IT IS OUR RESPONSIBILITYTO GOVERN THE SPORTAND WE AIM TO DO SO INAN INCLUSIVE MANNER


5958


ThecompositionoftheBHABoardwasamendedinearly

2019withtheaimofstrengtheningcollaborationwiththe

sport’sleadershipandtheracingindustry,whilstalso

ensuringsufficientindependenceonregulatorymatters.

ThenewBoardiscomprisedoftheChairmanandChief

Executive,fourindependentdirectorsandfourdirectors

nominatedbytheRCAandtheHorsemen.

TheonlychangestotheBoardin2018werethe

departuresoftheChairmanSteveHarman,who

resignedinNovember2018,andJulieHarrington,who

lefttheBoardon31August2018,oncompletionofher

termofoffice.1

TheBoardmetseventimesin2018andtheattendance

ofeachBoardmemberisrecordedbelow.

1MsHarringtonre-joinedtheBoardon12November2018,toassisttheBoardinremainingconstitutedinaccordance

withtheArticlesofAssociationwhenAthollDuncan(formerlyanindependentnon-executivedirector)became

interimChairman.MsHarringtonresignedon7March2019.

Board activity in 2018 was focussed across a number of areas of strategic importance for the sport:

• OngoingworkonmattersrelatingtotheHorserace

BettingLevy,followingtheimplementationofnew

legislationin2017

• OversightoftheCheltenhamFestivalReviewaimed

atimprovingsafetyandwelfareatCheltenhamand

allJumpracecourses

• OversightoftheworktointroducetheBHA’sfirst

safeguardingpolicyandregulations

• Oversightoftheprojecttoensurecompliance

withGDPR

• Consultationonandlaunchofthenewmodel

forracedayregulation

• Approvalforincreasedtestingonracedaysin

relationtogroupandgradedraces

• Oversightoftheongoingchangestothe

raceprogramme

• OversightoftherewriteoftheRulesofRacing

(tobelaunchedin2019)

• Commencementofareviewintothebuyingand

sellingofhorsesledindependentlyoftheBHA

• Considerationofenhancementsforoverallracing

administration(continuinginto2019)

Meeting Attendance

Steve Harman (Chairman) resigned from November 2018 6/7

Atholl Duncan (interim Chairman from November 2018) 7/7

Laura Whyte 7/7

Nöel Harwerth 7/7

Vivien Currie 7/7

Julie Harrington 4/7

Andrew Merriam 7/7

Joe Saumarez Smith 7/7

Sir Paul Stephenson 6/7

Rupert Arnold 7/7

Nick Rust 6/7

6160


Nick Rust,

Chief Executive

AppointedJanuary2015

2018Meetingsattended:6/7

Experience: Over27yearsofexperienceinthebetting

andgamingindustry.MostrecentlyasManagingDirector,

Retail,forLadbrokesPlcbutalsoinpreviousseniorroles

atBskyBincludingasManagingDirectorofSkyBet,andat

GalaCoral.Hehasextensiveexperienceinindustryand

corporateaffairs,havingmanagedkeyrelationshipswith

Governmentandregulators.Oversawestablishmentof

Britishracing’stripartitestructurethroughtheMembers’

Agreement,anindustry-widestrategyforgrowthand

replacementoftheHorseraceBettingLevyandhas

excellentrelationshipsacrossBritishracing.

Other roles: Non-ExecutiveDirectorofYorkTheatreRoyal

Committee membership:ExecutiveCommittee

(Chairman),RulesCommittee

Horse ownership interests: Horsesintrainingwith

MickyHammond,HugoPalmerandCharlieHills

Atholl Duncan,

Independent Non-Executive Director

Interim Chair, Nov 2018 – Jun 2019

AppointedDecember2014;

TermexpiresDecember2020


Experience:AnexperiencedNon-ExecutiveDirectorin

sportsorganisations,spent25yearswiththeBBC,as

ajournalistandTVnewsandsportsproducer,before

becomingHeadofNewsandCurrentAffairsfortheBBC

inScotland.FouryearsasDirectorofCorporateAffairs

withScottishWater.Athollsitsonnumerousadvisory

boards,hasworkedwiththeGovernmentonvarious

businessissuesandhasgoodknowledgeofsports

administrationandgovernance,andisaMemberofthe

CaledonianRacingSociety.

Other roles:ExecutiveDirectorofInstituteofChartered

AccountantsofScotland

Committee membership:AuditCommittee,

NominationsCommittee

Horse ownership interests:Horsesintrainingwith

LucindaRussellandRichardHughes

Andrew Merriam,

Senior Independent Director and

Independent Regulatory Director

AppointedSeptember2012;



Experience: QualifiedCharteredAccountantwithmore

than30years’experienceinfinancialservicesand

bankingand10yearsrunningtheBradfordsGroup,the

leadingprivately-ownedsupplierofbuildingmaterialsin

theUK.Andrew’sotherracinginterestsincludebeinga

MemberofTheJockeyClubandChairmanofthePoint-to-

PointAuthority.HeisalsoaTrusteeofRacingtoSchool,

RetrainingofRacehorsesandtheBritishRacingSchool.

Other roles:ChairmanofBerners-AllsoppEstate

ManagementCoLtdandDeputyLieutenantofthe

CountyofSuffolk

Committee membership: AuditCommittee(Chairman),

RemunerationCommittee,RulesCommittee(Chairman),

StewardingCommittee.


WarrenGreatrex

Sir Paul Stephenson,

Independent Regulatory Director

AppointedJuly2015;

TermexpiresJune2021


Experience:Ahighlydistinguishedcareerasa

policeofficer,holdingseniorcommandpositionsin

Merseyside,LancashireandLondon.Inhisroleswiththe

MetropolitanPoliceService–whereasCommissioner

hewasthemostseniorpoliceofficerintheUK–he

advisedgovernmentsonissuesrangingfromcounter

terrorismtoseriousorganisedcrimeandnationalpolice

improvements,withafocusonmodern,transparentand

collaborativepolicing.

Other roles:TrusteeofCrimestoppersUKandDirector

ofSirPaulStephensonLtd

Committee membership:RemunerationCommittee

Horse ownership interests: None

Julie Harrington,



TermexpiredMarch2019


Experience: Considerableknowledgeandexperience

inhorseracingasaresultofhereight-yearcareerwith

NorthernRacing,includingrolesasGroupOperations

DirectorandManagingDirectorofUttoxeterracecourse.

JuliewasalsoRegionalMarketingDirectoratWhitbread

Inns,RetailSectorDirectoratBritishAirways,Managing

DirectorofStGeorge’sPark,andwasappointedChief

ExecutiveofBritishCyclingin2016.

Other roles:ChiefExecutiveofBritishCycling

Committee membership: None

Horse ownership interests: None

Joe Saumarez Smith,





Experience:Joehasadvisedandworkedcloselywith

lotteries,governments,investmentbanksandoperating

companiesonstrategy,operationalrestructuring,

financeandmergerandacquisition.Co-foundedBede

GamingLtd,aprovideroftechnologytotheonlinecasino

andbingoindustries,andoneofthefastestgrowing

companiesinthenorth-east.Joeisashareholderin

StarBloodstockLtd,TotalPerformanceDataLtd,Anglo

AustralianRacingandWagonWheel14BettingFund.

Other roles:ChairmanofBedeGamingandChief

ExecutiveofSportsGamingLtd.ADirectorIrishOnline

BingoLotteryandScratchcardsLtd.Shareholdingsin

BedeGaming(Holdings)Ltd,HelixTechnologiesLtdand

eWaterPayLtd,CrowdConnectedLtd,FlexyfootLtd,

TalentPoolLtd,OnlineDomainServicesLtdandThe

GamesCompanyLtd

Committee membership:RemunerationCommittee,

AuditCommittee

Horse ownership interests: Horsesintraining

withEdDunlop,EdWalker,MartinKeighleyand

IlkaGansera-Leveque

Nöel Harwerth,



TermexpiresJuly2019


Experience:Aqualifiedsolicitor,previousrolesinclude

ChiefOperatingOfficerofCitibankInternationalandChief

taxOfficerofCitigroup,Dun&BradstreetCorporationand

KennecottCooperCorporation.

Other roles:ChairoftheUKExportFinanceBoard

andaNon-ExecutivememberoftheDepartmentfor

InternationalTradeBoard.ANon-ExecutiveDirectorof

StandardLife,theLondonMetalExchange,CHAPSCo

andSiriusMinerals

Committee membership:None


RichardHannonandRalphBeckett

Laura Whyte,





Experience: PartoftheJohnLewisManagement

Boardfor10years,mostrecentlyintheroleofHuman

ResourcesDirector.OtherrolesatJohnLewisincluded

DivisionalRegistrar;aboardroleaimedatensuring

employeeviewswereappropriatelysupportedand

reflected.LauraalsoworkedwiththeBritishEquestrian

FederationasaNon-ExecutiveDirectorandChairof

theirRemunerationCommitteefrom2013to2016.

Other roles:Non-ExecutiveDirectoroftheDefence

PeopleandTrainingBoardwithintheMinistryof

Defence,Non-ExecutiveDirectorofCapitalandRegional

Plc.ExecutiveTrusteeofWomeninRetailandaDirector

ofCarringtonWhyteConsultingLtd.Investmentportfolio

includessharesin32redandWilliamHill.

Committee membership:RemunerationCommittee

(Chairman)

Horse ownership interests:None

BOARD MEMBERS

6362


Rupert Arnold,

Member Nominated Director

AppointedJanuary2015;

TermexpiresOctober2019


Experience: RupertisChiefExecutiveoftheNational

TrainersFederation,therepresentativebodyforlicensed

racehorsetrainersinGreatBritain.Heisadirectorof

theHorsemen’sGroupandRacingtoSchool.Earlierin

hiscareer,afteremploymentasassistanttrainer,Rupert

heldatrainer’slicenceforsixyears,.AlsoaTrusteeof

theNationalTrainersFederationCharitableTrustandthe

RacehorseTrainersBenevolentFund

Other roles:DirectorandTrusteeofTheHunsletClub(Leeds)

Committee membership: Members’Committee


Vivien Currie,

Member Nominated Director

AppointedJanuary2016;

TermexpiredDecember2018


Experience:VivienisChiefExecutiveofHamiltonPark

racecourseandViceChairmanoftheRacecourse

Association.AQualifiedCharteredAccountantwith

Ernst&Young,workinginLondon,Australiaand

Glasgow,beforejoiningtelecomsbusinessDamovo

whereasDirectorofStrategyshewasresponsiblefor

theintegrationofthegroup’s18countries’salesforces

beforebecomingheadofGlobalSalesandSolutions.

Previouslyalsopart-ownerandChiefExecutiveof

LivingstonFootballClub,havingboughtthecluband

takenitoutofadministration.

Other roles: MemberoftheDevelopmentBoardofthe

MarieCurieHospice(Glasgow)

Committee membership:AuditCommittee


Steve Harman,

Chairman (to Nov 2018)

AppointedJuly2013;

TermexpiredNovember2018


Experience:From1980onwards,SteveworkedforRoyal

DutchShellinpositionsacrossEurope,Asiaandthe

Americas.HisrolesincludedCEOofShellMarine,CEOof

PennzoilandVicePresidentofRoyalDutchShell.Hehas

extensiveexperienceofdealingwithmultiplestakeholders

andgovernmentorganisations,andhassatonvarious

corporateboardswhileholdingavarietyofExecutiveand

Non-ExecutivepositionsintheUK,AmericaandAsia.

Other roles:ADirectorandTrusteeofHelpforHeroes.

BoardmemberDurhamUniversityandChairmanof

UstinovCollegeCouncil.ShareholdingsinStGeorge’s

RecruitmentandVIPEscapes.Asupporterandmentortoa

rangeofentrepreneurialstart-ups.

Committee membership: NominationsCommittee

(Chairman),Members’Committee(Chairman)

Horse ownership interests:HorsesintrainingwithPhilip

Hobbs,DavidPipe,CharlieLongsdon,RichardFahey,

AndrewBaldingandMartinKeighley

*AllDirectorswererequiredtoprovidealistof

bettingoperatorswithwhichaccountswereheld.

Asof2019,Directorsarenotpermittedtohave

theseaccounts.AllDirectors’interestslistedare

correctfor2018andmayhavechangedin2019.

BOARD MEMBERS

ADDED IN 2019

Annamarie Phelps,

Chair

(fromJune2019)

David Armstrong,

Member

NominatedDirector

(fromFebruary2019)

Maggie Carver,

Member

NominatedDirector

(fromMarch2019)

Nicholas Cooper,

Member

NominatedDirector

(fromApril2019)

6564


Meeting Attendance

Andrew Merriam (Chairman) 2/2

Atholl Duncan (resigned November 2018) 1/1

Vivien Currie 2/2

Philip Freedman 1/2


Meeting Attendance

Laura Whyte (Chairman) 3/3

Andrew Merriam 2/3


Sir Paul Stephenson 3/3

GOVERNANCE COMMITTEES

TheBoardhasthreeprincipalcommitteesrelatingtogovernance.

Audit and Risk Committee

TheAuditandRiskCommitteehasfourmembers,twoindependentBoarddirectors(ofwhichoneischairman)and

twonominatedmembersfromtheRacecourses(alsoaBoardmember)andHorsemen.TheAuditCommitteemeets

twiceayear,oncepre-auditinNovemberandoncepost-auditinApril.TheexternalauditorsandrelevantBHAstaff

alsoattendbothmeetings.TheCommittee’smainresponsibilitiesincludemonitoringtheintegrityofthefinancial

statementsoftheCompany;reviewingtheexternalauditor’sassessmentofinternalfinancialcontrolsandrisk

managementsystems;reviewingtheadequacyandsecurityoftheCompany’sarrangementsforitsemployeesto

raiseconcerns,inconfidence,aboutpossiblewrongdoinginfinancialreporting;overseeingtherelationshipwith

theexternalauditor;reviewingandapprovingtheexternalauditplanandthelevelofnon-auditfeesincurred;and

overseeingtheriskregister.

InDecember2018,theCommitteeconsideredandimplementedanumberofrecommendationsoftheSlaughter&

MayreviewrelatingtotheremitandoperationoftheCommittee,includingexpandingitsfunctionsothatittakes

primaryresponsibilityforriskmonitoring,subjecttooversightbytheBoard.TheCommitteealso,inlinewithgood

governancerequirements,tenderedthegroupauditsandappointedBDOLLPasnewauditorsforthe2018yearend.

Nominations Committee

TheNominationsCommitteehasfourmembers,twoindependentBoarddirectors(ofwhichoneisChairman)and

twonominatedmembersfromtheRacecoursesandHorsemen.TheroleoftheNominationsCommitteeistomake

recommendationstotheBoardonsuitablecandidatesforappointmenttoholdofficeasChairman,ChiefExecutive,

IndependentNEDsandIndependentRegulatoryNEDsensuringanappropriatebalanceofexpertiseandability.In

addition,itisresponsibleforreviewingthesuccessionplansfortheChairman,ChiefExecutive,IndependentNEDS

andIndependentRegulatoryNEDs.

In2018whentheNominationsCommitteemettodiscusstheappointmentofanewBHAChair,potentiallyconflicted

membersoftheCommitteestooddownandwerereplacedbyotherindependentnon-executivedirectors.

Other relevant committees

Members’ Committee

TheMembers’Committeeisatripartiteindustrycommitteeresponsibleformakinghigh-levelstrategicdecisionson

behalfofthesport.ItmeetsatleastthreetimesayearandreportstotheBHABoard.

Voting Members:SteveHarman,Chair(BHA),JulianRichmond-Watson(TBA),MaggieCarver(RCA),

NicholasCooperC.B.E.(ROA),RupertArnold(NTF/LicensedPersonnel)

Non-Voting Members:DavidThorpe(RCA),NickRust(BHA),RogerWeatherby(RCA)

Invited Observers: CharlesBarnett(RCA),JonjoSanderson(RCA),NigelPayne(PJA),

PhilipFreedman(Horsemen’sGroup),TonyLangham(GreatBritishRacing)

Executive Committee

TheExecutiveCommitteeisatripartiteindustrycommitteeresponsiblefortakingexecutivedecisionsand

implementingthestrategysetbytheMembers’Committee.ItmeetseighttimesayearandreportstotheMembers’

Committee.Twomeetingseachyearhavefullrepresentationfromindustrychiefexecutives.

Executive Representatives:NickRust,Chair(BHA),CharlieLiverton(Horsemen’sGroup)andDavidArmstrong(RCA)

Non-Voting Attendee:RodStreet(GreatBritishRacing).

Remuneration Committee

TheRemunerationCommitteehasfourmembers,whoareallindependentBoarddirectors.Theroleofthe

RemunerationCommitteeistodeterminetheframeworkandpolicyontermsofengagement(including

remuneration)ofthedirectorsandseniormanagementoftheCompany,andthespecificremunerationof

eachExecutiveDirectorandotherseniorexecutives(includingentitlementsunderpensionschemes)andany

compensationpayments.FeespayabletoNEDsandallBoardmembersaredeterminedbytheBoardwithinthe

policyestablishedbytheRemunerationCommitteeontherecommendationoftheChairmanandChiefExecutive.

Meeting Attendance

Steve Harman 1/2

Maggie Carver 2/2

Nicholas Cooper 2/2

Atholl Duncan 1/2

Laura Whyte 1/2

Andrew Merriam 1/2

6766


Risk identified Further details

RegulatorychangeinUK

bettingmarketimpacting

Racing’s/industryincome

Government’sReviewofGamingMachineshasledtoreducedmaximumstakesbeing

introducedfromApril2019.Racingiskeentosupportasociallyresponsiblebetting

industrywithracingasacoreproduct.Wecontinuetodiscusswithotherelementsof

theindustrytheimpactthesechangeswillhaveonracecoursefundingandlevyand

proactivelytakestepstoensureracingcontinuestothrivebothfinanciallyandina

sociallyresponsiblemanner.

Negativepublicattitudes

towardsracingonwelfare

grounds

Weareawareofthechangingsocialattitudestowardscertainareasthatexistwithin

racingandareproactivelytakingstepstoensureweleadonthisdebateandchange

whereappropriate.Tohelpfocusonthisevenmore,wehavecreatedaHorseWelfare

Boardwhichwilllookatallaspectsofahorse’slife,includingpreandpostracing.We

willalsocontinuetoproactivelyreviewareasofthesportwhererisksareevident.

Significantoutbreakof

equinedisease

Anoutbreakofequinediseasethataffectsanimalmovementcausingmajordisruptionto

thesport.Thisriskbecamearealityinearly2019whenanewstrainofEquineInfluenza

stoppedracingfor6days.Theproceduressetupanddecisiveactionwithsupportfrom

horsemenandveterinarypractitionersallowedaswiftandrobustresponsetoalleviate

thisthreat.Thesport’scontinuedfundingforequinediseaseresearchandmanagement

isessentialandisfundedthroughtheHBLB.

ORGANISATIONAL RISKS EXECUTIVE DIRECTORS

NON-EXECUTIVE DIRECTORS

REMUNERATION REPORT

TheCompanymaintainsariskregisterwhichisreviewedregularlybyboththeAuditandRiskCommitteeandthe

Board.TheregisterincludesBHAoperationalrisksandalsowiderindustryrisksinareaswhereBHAhasleadership

responsibilitiesandwhichwouldimpactonracecourses,horsemenandthesport,shouldtheymaterialise.

TheregisterwasreviewedinDecember2018.Keyrisksinclude:

ExecutiveDirectorpayisacombinationoffixedbasicsalary,allowancesandperformance-drivenremuneration

baseduponoperationaldeliveryandadherencewithfinancialtargets.

ThetablesummarisesthemainelementsofremunerationforNon-ExecutiveDirectors

*FulldetailsoftotalBoardremunerationisshowninnotethreeofthefinancialstatements

Therewere10employees(9atyearend)categorisedasExecutiveDirectorswithtwoappointmentsandone

resignationthroughout2018.Theirtotalremuneration(includingpensioncontributionsandEmployersNI)

amountedto£2.027mareductionof£73,000comparedto2017.

During2018thebusinessconductedareviewoftheExecutiveDirectorannualbonus.Aconsultationprocess

resultedintheremovalofthecontractualbonusentitlement.

RemunerationforExecutiveandNon-ExecutiveDirectorsisdeterminedbytheRemunerationCommittee.

Element and link to performance Summary of current policy Changes ahead in 2019

Base salaryissetatalevelthataims

toattractandretainhighperforming

executivedirectors

Salariesarereviewedannually,

takingintoaccountperformanceor

changesinjobroles.Thisisinline

withthepolicyforallemployees.

None

Allowancesareallocatedforspecific

purposeslinkedtoeachrole

Carallowancesarepayable

toallexecutivedirectors.

Accommodationandtravel

allowancesarepayableunder

specificcircumstances.

None

Pension and benefitsarepartof

acompetitivetotalremuneration

package

TheCompanyoperatesadefined

contributionpensionschemefor

allemployeesona1:2matching

basisuptoamaximumcompany

contributionof10%.

None

Element and link to performance Summary of current policy

Directors Feesaresetaccording

totheroleundertaken

Reviewedannually,feesfor2017wereasbelow:

Chairman–£100,000

IndependentRegulatoryDirectors–£27,000–£35,000

OtherNon-ExecutiveDirectors–£27,000

Benefits Non-ExecutiveDirectorsdonotreceiveanybenefits

fromthecompanyoutsideofDirectors’liability

insurance

FINANCIAL STATEMENTS

Profit and Loss 70

Balance Sheet 72

Cash Flow 74

Equity Changes 75

Notes 76

7170


PROFIT AND LOSS

CONSOLIDATED PROFIT AND LOSS ACCOUNT(fortheyearended31december2018)

COMPANY PROFIT AND LOSS ACCOUNT AND OTHER COMPREHENSIVE INCOME

(fortheyearended31December2018)

CONSOLIDATED OTHER COMPREHENSIVE INCOME / (LOSS)(fortheyearended31December2018)

CONSOLIDATED OTHER COMPREHENSIVE INCOME / (LOSS)(fortheyearended31December2018)

Note2018

£’0002017

£’000

Group turnover 2 36,600 34,717

Administrativeexpenses (35,335) (33,348)

Operating profit 5 1,265 1,369

Interestonloansreceivable 6 100 -

Otherinterestreceivableandsimilarincome 7 17 17

Interestpayableandsimilarexpenses 8 (434) (443)

Profit before taxation 948 943

Taxationonprofit 9 20 219

Profit for the financial year 968 1,162

Note2018

£’0002017

£’000

Turnover 2 34,414 33,236

Administrativeexpenses (33,216) (31,749)

Operating profit 5 1,198 1,487

Otherinterestreceivableandsimilarincome 7 14 12

Interestpayableandsimilarexpenses 8 (434) (443)

Profit before taxation 778 1,056

Taxationonprofit 9 67 173


Note2018

£’0002017

£’000


Other comprehensive income / (loss)

Remeasurementofthenetdefinedbenefitliability 17 9,042 (2,217)

Total comprehensive income / (loss) for the year 10,010 (1,055)

Note2018

£’0002017

£’000


Other comprehensive income / (loss)

Remeasurementofthenetdefinedbenefitliability 17 9,042 (2,217)

Total comprehensive income / (loss) for the year 9,887 (988)

Theprofitintheaboveprofitandlossaccountrelateentirelytocontinuingoperations.

Thenotesonpages25to67formpartofthesefinancialstatements.

Theprofitintheaboveprofitandlossaccountrelateentirelytocontinuingoperations.

Thenotesonpages20to45formpartofthesefinancialstatements.

Thisannualreport,whichdoesnotconstitutethecompany’sandgroup’sstatutoryannualreportandfinancial

statementsthatcanotherwisebeobtainedfromCompaniesHouse,includesfinancialstatementsandnotesthat

havebeenextractedfromthestatutoryannualreportandfinancialstatements.Thesestatutoryannualreportand

financialstatementsweresignedbyBDOLLPon19August2019andreferencestoapprovalorsigningdatewithin

theseextractsrefertothisdate.

7372


BALANCE SHEET

CONSOLIDATED BALANCE SHEET (at31December2018)

Note2018

£’0002018

£’0002017

£’0002017

£’000

Fixed assets

Intangibleassets 10 952 1,386

Tangibleassets 11 715 606

1,667 1,992

Current assets

Debtors(including£1,715,000(2017:£1,983,000)

dueaftermorethanoneyear)13 9,513 10,046

Cashatbankandinhand 14 12,463 12,415

21,976 22,461

Creditors:amountsfallingduewithinoneyear 15 (13,876) (15,008)

Net current assets 8,100 7,453

Total assets less current liabilities 9,767 9,445

Provisionsforliabilities

Pensionandsimilarobligations 17 (8,227) (17,915)

Net assets / (liabilities) 1,540 (8,470)

Capital and reserves

Capitalreserve 19 19

Profitandlossaccount 1,521 (8,489)

Shareholders’ funds / (deficit) 1,540 (8,470)

Thenotesonpages25to67formpartofthesefinancialstatements.Thesefinancialstatementswereapproved

bytheboardofdirectorson5August2019andweresignedonitsbehalfby:NJRust,Director

COMPANY BALANCE SHEET (at31December2018)

Note2018

£’0002018

£’0002017

£’0002017

£’000

Fixed assets

Intangibleassets 10 952 1,386

Tangibleassets 11 706 591

Investments 12 3,456 3,456

5,114 5,433

Current assets

Debtors(including£56,000(2017:£44,000)

dueaftermorethanoneyear)13 7,540 7,872

Cashatbankandinhand 14 10,504 10,811

18,044 18,683

Creditors: amountsfallingduewithinoneyear 15 (13,606) (14,763)

Net current assets 4,438 3,920

Total assets less current liabilities 9,552 9,353

Provisionsforliabilities

Pensionandsimilarobligations 17 (8,227) (17,915)

Net assets / (liabilities) 1,325 (8,562)

Capital and reserves

Capitalreserve 19 19

Profitandlossaccount 1,306 (8,581)

Shareholders’ funds / (deficit) 1,325 (8,562)

Thenotesonpages25to67formpartofthesefinancialstatements.Thesefinancialstatementswereapproved

bytheboardofdirectorson5August2019andweresignedonitsbehalfby:NJRust,Director

7574


CASH FLOW EQUITY CHANGES

CONSOLIDATED CASH FLOW STATEMENT(fortheyearended31December2018) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

COMPANY STATEMENT OF CHANGES IN EQUITY

Note2018

£’0002017

£’000

Cash flows for operating activities

Profitforthefinancialyear 968 1,162

Adjustmentsfor

Depreciation,amortisationandimpairment 724 772

Interestincomereceivableandsimilarincome (17) (17)

Gainonfinancialassetsatfairvaluethroughprofitandloss (100) -

Interestpayableandsimilarexpenses 434 443

Lossonsaleoffixedassets 11 -

Corporationtaxreclaimedinrespectofpriorperiods 137 154

2,157 2,514

Decrease/(Increase)intradeandotherdebtors 434 (1,452)

Decreaseintradeandothercreditors (1,171) (23)

Taxation (20) (219)

Differencebetweencashcontributionsandcurrentservicecharge (1,080) (1,158)

Netcashfromoperatingactivities 320 (338)

Cash flows from investing activities

Developmentexpenditure (256) (553)

Acquisitionoftangiblefixedassets (187) (325)

Interestreceived 17 17

Netcashfromoperatingactivities (426) (861)

Cash flows from financing activities

Loansrepaymentsfromassociatedundertakings 154 186

Netcashfromoperatingactivities 154 186

Netincrease/(decrease)incashandcashequivalents 21 48 (1,013)

Capital reserve £000

Profit and loss account £000

Total equity £000

Balanceat1January2017 19 (7,434) (7,415)

Total comprehensive income for the year

Profit - 1,162 1,162

Othercomprehensiveloss - (2,217) (2,217)

Balanceat31December2017 19 (8,489) (8,470)



Total equity £000



Loss - 1,229 1,229

Othercomprehensiveloss - (2,217) (2,217)

Balanceat31December2017 19 (8,581) (8,562)

Share Capital £000


Total equity £000



Profit - 845 845

Othercomprehensiveincome - 9,042 9,042

Balanceat31December2018 19 1,306 1,325



Total equity £000



Profit - 968 968

Othercomprehensiveloss - 9,042 9,042

Balanceat31December2018 19 1,521 1,540

7776


NOTES (FORMINGPARTOFTHEFINANCIALSTATEMENTS)

1. ACCOUNTING POLICIES

BritishHorseracingAuthorityLimited(the“Company”)

isaprivatecompanylimitedbyguaranteeand

incorporated,registeredanddomiciledintheUK.The

registerednumberis02813358andtheregisteredoffice

is75HighHolborn,London,WC1V6LS.

TheGroupandparentcompanyfinancialstatements

werepreparedinaccordancewithFinancialReporting

Standard102TheFinancialReportingStandard

applicableintheUKandRepublicofIreland(“FRS102”).

Thepresentationcurrencyofthesefinancialstatements

issterling.Allamountsinthefinancialstatementshave

beenroundedtothenearest£1,000.

Theparentcompanyisincludedintheconsolidated

financialstatements,andisconsideredtobeaqualifying

entityunderFRS102paragraphs1.8to1.12.The

followingexemptionsavailableunderFRS102inrespect

ofcertaindisclosuresfortheparentcompanyfinancial

statementshavebeenapplied:

• Thereconciliationofthenumberofsharesoutstanding

fromthebeginningtotheendoftheperiodhasnot

beenincludedasecondtime;

• NoseparateparentcompanyCashFlowStatement

withrelatednotesisincluded;and

• KeyManagementPersonnelcompensationhasnot

beenincludedasecondtime.

• CertaindisclosuresrequiredbyFRS102.11Basic

FinancialInstrumentsandFRS102.12OtherFinancial

InstrumentIssuesinrespectoffinancialinstruments

notfallingwithinthefairvalueaccountingrulesof

Paragraph36(4)ofSchedule1.

Theaccountingpoliciessetoutbelowhave,unless

otherwisestated,beenappliedconsistentlytoall

periodspresentedinthesefinancialstatements.

Judgementsmadebythedirectors,intheapplication

oftheseaccountingpoliciesthathavesignificanteffect

onthefinancialstatementsandestimateswitha

significantriskofmaterialadjustmentinthenextyear

arediscussedinnote16inrelationtothefairvalue

assessmentoffinancialinstruments.

Measurement convention

Thefinancialstatementsarepreparedonthehistorical

costbasiswiththeexceptionofcertainfinancial

instrumentswhichhavebeenmeasuredatfairvalue.

Going concern

ThedirectorsbelievethattheCompanyandGroupare

wellplacedtomanagetheirbusinessriskssuccessfully

despitethecurrentuncertaineconomicoutlook.The

directorshaveareasonableexpectationthatthe

CompanyandGrouphasadequateresourcestocontinue

inoperationalexistencefortheforeseeablefuture.

TheGrouphasamaterialDeficitontheGroupPension

Schemewhichhasalongtermplantobesettledand

thereforehaslimitedimpactonannualcashflows.

Onthisbasisthedirectorscontinuetoadoptthegoing

concernbasisofaccountinginpreparingtheannual

financialstatements.

Basis of consolidation

Theconsolidatedfinancialstatementsincludethe

financialstatementsoftheCompanyanditssubsidiary

undertakingsmadeupto31December2018.

Asubsidiaryisanentitythatiscontrolledbytheparent.

Theresultsofsubsidiaryundertakingsareincluded

intheconsolidatedprofitandlossaccountfromthe

datethatcontrolcommencesuntilthedatethatcontrol

ceases.ControlisestablishedwhentheCompanyhas

thepowertogoverntheoperatingandfinancialpolicies

ofanentitysoastoobtainbenefitsfromitsactivities.In

assessingcontrol,theGrouptakesintoconsideration

potentialvotingrightsthatarecurrentlyexercisable.

TheCompanydoesnotownallthesharesinits

subsidiary,BritishHorseracingDatabaseLimited

(‘BHD’),withtheminorityshareholdersholding3‘B’and

3‘C’shareseach,comparedtotheCompany’sholding

of4,003,932‘A’shares.Nominorityinterestsareshown

intheconsolidatedaccountsoftheCompanyas(i)under

theprovisionscontainedwithintheArticlesofBHDthe

‘A’shareholderistheonlyshareholderentitledtoa

distribution,ifandwhenadistributionisdeclaredbythe

Boardand(ii)onawindinguptheassetsaredistributed

inaccordancewiththenumberofsharesheldin

allclasses.

AnassociateisanentityinwhichtheGrouphas

significantinfluence,butnotcontrol,overtheoperating

andfinancialpoliciesoftheentity.Significanceinfluence

ispresumedtoexistswhentheinvestorsholdsbetween

20%and50%oftheequityvotingrights.

Ajointventureisacontractualarrangement

undertakinginwhichtheGroupexercisesjointcontrol

overtheoperatingandfinancialpoliciesoftheentity.

Wherethejointventureiscarriedoutthroughanentity,

itistreatedasajointlycontrolledentity.TheGroup’s

shareoftheprofitslesslossesofassociatesandof

jointlycontrolledentitiesisincludedintheconsolidated

profitandlossaccountanditsinterestintheirnet

assetsisrecordedonthebalancesheetusingthe

equitymethod.

Intheparentfinancialstatements,investmentsare

carriedatcostlessimpairment.

Intangible and tangible fixed assets

Thecostofintangibleandtangiblefixedassetsistheir

purchasecost,togetherwithanyincidentalcostsof

acquisition.Assetsunderconstructionrelatestowork

inprogressoncomputerrelateddevelopment.This

willbeamortised/depreciatedonceitcomesintouseon

thebasissetoutbelow.Internallygeneratedintangible

assetsrelatetocomputerdevelopmentonnewsystems

andarecapitalisedbaseduponassetcostincludingthe

staffcostsoftheinternaldevelopmentteamcalculated

onanhourlybasis.

Intangibleassetsarealsoreviewedforimpairmentand

theassetsdeterminedtohavepositivefuturebenefit

whichisinexcessoftheirnetbookvalue.

Depreciation/amortisationisprovidedsoastowrite

offthecostoftangibleandintangiblefixedassetsona

straightlinebasisovertheestimatedusefuleconomic

livesoftheassetsconcerned.Theratesofdepreciation

/amortisationareasfollows:

Leaseholdimprovement 3-5yearsorlease

term,ifshorter

Contractcomputerdevelopment 7years

Othercomputerdevelopment 4years

Fixturesfittingsandofficeequipment 3-5years

Intangibleassets 3-5years

TheCompanyholdsalicenceforuseoftheDatabaseof

pre-racedataforgovernanceandregulatorypurposes.

InaccordancewithFRS102,noamountshavebeen

7978


capitalisedinthebalancesheetinrespectofthese

rights.Thecostofacquiringthisassetiswrittenoffto

theprofitandlossaccountasincurred.

Fixed asset investments

Fixedassetinvestmentsinjointventuresand

subsidiariesareheldatcostlessanyprovisionfor

impairmentinthefinancialstatementsoftheCompany.

Basic financial instruments

Trade and other debtors / creditors

Tradeandothercreditorsarerecognisedinitiallyat

transactionpriceplusattributabletransactioncosts.

Subsequenttoinitialrecognitiontheyaremeasuredat

amortisedcostusingtheeffectiveinterestmethod,less

anyimpairmentlossesinthecaseoftradedebtors.If

thearrangementconstitutesafinancingtransaction,for

exampleifpaymentisdeferredbeyondnormalbusiness

terms,thenitismeasuredatthepresentvalueoffuture

paymentsdiscountedatamarketrateofinterestfora

similardebtinstrument.

Interest-bearing borrowings classified as basic

financial instruments

Interest-bearingborrowingsarerecognisedinitiallyat

thepresentvalueoffuturepaymentsdiscountedata

marketrateofinterest.Subsequenttoinitialrecognition,

interest-bearingborrowingsarestatedatamortised

costusingtheeffectiveinterestmethod,lessany

impairmentlosses.

Investments in preference and ordinary shares

Investmentsinequityinstrumentsaremeasuredinitially

atfairvalue,whichisnormallythetransactionprice.

Transactioncostsareexcludediftheinvestmentsare

subsequentlymeasuredatfairvaluethroughprofit

andloss.Subsequenttoinitialrecognitioninvestments

thatcanbemeasuredreliablyaremeasuredatfair

valuewithchangesrecognisedinprofitorloss.Other

investmentsaremeasuredatcostlessimpairmentin

profitorloss

Investments in subsidiaries, jointly controlled entities

and associates

Theseareseparatefinancialstatementsofthecompany.

Investmentsinsubsidiaries,jointlycontrolledentities

andassociatesarecarriedatcostlessimpairment.

Cash and cash equivalents

Cashandcashequivalentscomprisecashbalancesand

calldepositswithaninitialtermoflessthan3months.

Bankoverdraftsthatarerepayableondemandandform

anintegralpartoftheCompany’scashmanagementare

includedasacomponentofcashandcashequivalents

forthepurposeonlyofthecashflowstatement.

Foreign currencies

Transactionsinforeigncurrenciesarerecordedusing

therateofexchangerulingatthedateofthetransaction.

Monetaryassetsandliabilitiesdenominatedinforeign

currenciesaretranslatedusingthecontractedrateor

therateofexchangerulingatthebalancesheetdateand

thegainsorlossesontranslationareincludedinthe

profitandlossaccount.

Reserves

Thegroup’sandcompany’sreservesareasfollows:

• Capitalreserverepresentstheamountsthatthe

membersguaranteetocontributetowardsthedebtsof

thecompany

• Profitandlossaccountrepresentscumulativeprofits

orlossesnetofdividendspaidandotheradjustments.

Turnover

Turnover,whichexcludesvalueaddedtax(‘VAT’),

representstheinvoicedvalueofgoodsandservices

suppliedinconnectionwiththeadministrationof

horseracinginGreatBritain.TheCompany’sincome

isinvoicedandrecognisedwhentheseservicesare

deliveredtoracecoursesandotherparticipants.

Inaddition,includedwithinGroupturnoverareamounts

(excludingVAT)derivedfromincomefromsignedlicence

agreementswiththirdparties.Thelicenceincome

streamsderivedbytheGrouparerecognisedinthe

periodtheyrelateto.

Interest receivable and interest payable

Otherinterestreceivableandsimilarincomeinclude

interestreceivableonfundsinvested.Interestincomeis

recognisedintheprofitorlossasitaccrues.

Interestpayableandsimilarexpensesincludeinterest

payable,andnotinterestexpensesinrelationtopension

schemeassetsandliabilities.Interestpayableis

recognisedinprofitorlossasitaccrues.

Related party disclosure

RelatedPartyDisclosuresrequiresthedisclosureof

thedetailsofmaterialtransactionsbetweentheGroup

andanyrelatedparties,asdefined.Detailsofmaterial

relatedpartytransactionsareincludedinnote21tothe

financialstatements.

Provisions

Aprovisionisrecognisedinthebalancesheetwhenthe

entityhasapresentlegalorconstructiveobligationas

aresultofapastevent,thatcanbereliablymeasured

anditisprobablethatanoutflowofeconomicbenefits

willberequiredtosettletheobligation.Provisionsare

recognisedatthebestestimateoftheamountrequired

tosettletheobligationatthereportingdate.

Taxation

Taxontheprofitorlossfortheyearcomprisescurrent

anddeferredtax.Taxisrecognisedintheprofitand

lossaccountexcepttotheextentthatitrelatestoitems

recogniseddirectlyinequityorothercomprehensive

income,inwhichcaseitisrecogniseddirectlyinequity

orothercomprehensiveincome.

Currenttaxistheexpectedtaxpayableorreceivableon

thetaxableincomeorlossfortheyear,usingtaxrates

enactedorsubstantivelyenactedatthebalancesheet

date,andanyadjustmenttotaxpayableinrespectof

previousyears.

Deferredtaxisprovidedontimingdifferenceswhich

arisefromtheinclusionofincomeandexpensesin

taxassessmentsinperiodsdifferentfromthosein

whichtheyarerecognisedinthefinancialstatements.

Deferredtaxisnotrecognisedonpermanentdifferences

arisingbecausecertaintypesofincomeorexpense

arenon-taxableoraredisallowablefortaxorbecause

certaintaxchargesorallowancesaregreaterorsmaller

thanthecorrespondingincomeorexpense.

Deferredtaxismeasuredatthetaxratethatisexpected

toapplytothereversaloftherelateddifference,using

taxratesenactedorsubstantivelyenactedatthebalance

sheetdate.Deferredtaxbalancesarenotdiscounted.

Unrelievedtaxlossesandotherdeferredtaxassetsare

recognisedonlytotheextentthatisitprobablethatthey

willberecoveredagainstthereversalofdeferredtax

liabilitiesorotherfuturetaxableprofits.

Operating leases

Payments(excludingcostsforservicesandinsurance)

madeunderoperatingleasesarerecognisedinthe

profitandlossaccountonastraight-linebasisoverthe

termoftheleaseunlessthepaymentstothelessorare

structuredtoincreaseinlinewithexpectedgeneral

inflation;inwhichcasethepaymentsrelatedtothe

structuredincreasesarerecognisedasincurred.Lease

incentivesreceivedarerecognisedinprofitandlossover

thetermoftheleaseasanintegralpartofthetotallease

expense.

Employee benefits

Defined contribution plans and other long term

employee benefits

Adefinedcontributionplanisapost-employment

benefitplanunderwhichthecompanypaysfixed

contributionsintoaseparateentityandwillhaveno

legalorconstructiveobligationtopayfurtheramounts.

Obligationsforcontributionstodefinedcontribution

pensionplansarerecognisedasanexpenseintheprofit

andlossaccountintheperiodsduringwhichservices

arerenderedbyemployees.

Defined benefit plans

Adefinedbenefitplanisapost-employmentbenefit

planotherthanadefinedcontributionplan.Theentity’s

netobligationinrespectofadefinedbenefitplanis

calculatedbyestimatingtheamountoffuturebenefit

thatemployeeshaveearnedinreturnfortheirservicein

thecurrentandpriorperiods;thatbenefitisdiscounted

todetermineitspresentvalue.Thefairvalueofany

planassetsisdeducted.Theentitydeterminesthe

netinterestexpense/incomeonthenetdefinedbenefit

8180


liability/assetfortheperiodbyapplyingthediscount

rateasdeterminedatthebeginningoftheannualperiod

tothenetdefinedbenefitliability/assettakingaccount

ofchangesarisingasaresultofcontributionsand

benefitpayments.

Thediscountrateistheyieldatthebalancesheet

dateonAAcreditratedbondsdenominatedinthe

currencyof,andhavingmaturitydatesapproximating

tothetermsof,theentity’sobligations.Avaluationis

performedtrienniallybyaqualifiedactuaryandthe

positionupdatedannuallybyaqualifiedactuaryusing

theprojectedunitcreditmethod.Theentityrecognises

netdefinedbenefitplanassetstotheextentthatitis

abletorecoverthesurpluseitherthroughreduced

contributionsinthefutureorthroughrefundsfrom

theplan.

Changesinthenetdefinedbenefitliabilityarisingfrom

employeeservicerenderedduringtheperiod,net

interestonnetdefinedbenefitliability,andthecostof

planintroductions,benefitchanges,curtailmentsand

settlementsduringtheperiodarerecognisedinprofit

orloss.

Remeasurementofthenetdefinedbenefitliability/asset

isrecognisedinothercomprehensiveincomeinthe

periodinwhichitoccurs.

Termination benefits

Terminationbenefitsarerecognisedasanexpense

whentheentityisdemonstrablycommitted,without

realisticpossibilityofwithdrawal,toaformaldetailed

plantoeitherterminateemploymentbeforethe

normalretirementdate,ortoprovidetermination

benefitsasaresultofanoffermadetoencourage

voluntaryredundancy.

Judgements in applying accounting policies and key

sources of estimation uncertainty

Inpreparingthesefinancialstatements,thedirectors

havemadethefollowingjudgements:

• Determiningwhetherleasesareoperatingorfinance

leasesbaseduponwhethertherisksandrewardsof

ownershiphavebeentransferredfromthelessorto

theleaseonaleasebyleasebasis.

• Determinewhetherthereareindicatorsofimpairment

ofthecompany’sfixedassets.Factorstakeninto

considerationincludetheeconomicviabilityand

expectedfuturefinancialperformanceoftheassets

anditsabilitytocontinuetobeofusetothecompany’s

businessactivities.

Other key sources of estimation uncertainty

• IntangibleandTangiblefixedassets(notes10and11)

Tangibleandintangiblefixedassetsaredepreciated

overtheirusefuleconomiclivestakingintoaccount

anyresidualvalueswhereappropriate.Theuseful

economiclivesareassessedattimebroughtintouse,

andreviewedateachyearendtodetermineifthese

assumptionshavechanged.Anyintangibleswhichdo

notgeneratefuturecashflowsorarenotinusebythe

businessarewrittenoff.

Thecreationofcertainintangibleassetsisbased

uponcostsoftheITdevelopmentstaffinvolved,the

hourscompletedonaprojectandthehourlyrateof

pay.Noadditionalmanagementtimeisincludedinthe

capitalisedcosts.Giventhereisnoformaltimesheet

system,thiscalculationrequiresjudgement.

• Definedbenefitpensionscheme(note17)

Thecostofdefinedbenefitpensionplansaredetermined

usingactuarialvaluations.Theactuarialvaluation

involvesmakingassumptionsaboutdiscountrates,

futurelevelsofinflation,mortalityandinvestment

returns.Duetothecomplexityofthevaluation,the

underlyingassumptionsandthelongtermnatureof

theliabilities,suchestimatesaresubjecttosignificant

uncertainty.Thediscountrateisdeterminedusing

appropriatecorporatebondsasspecifiedunderFRS102,

themortalityratesarebaseduponmortalitytables

andthefutureratesofinflationarebaseduponmarket

conditionsandexpectations.

• Taxation,includingdeferredtaxation(note9)

Thetaxationchargeandrelatedprovisionfor

corporationtaxreliesuponaseriesofestimatesand

judgementsregardingdisallowableitemsandreliefs.It

alsousesestimatesforlikelyresearchanddevelopment

taxcreditswhichareestimatedbaseduponresearch

spendandtheanticipatedamountwhichwillbe

exchangedforcash.Thisisshownasdeferredtax.

Deferredtaxassetsareonlyrecognisedtotheextent

thattheseareexpectedtobeoffsetagainstfuture

taxableprofits.Significantmanagementjudgementis

exercisedindeterminingtheleveloftaxassetsthatcan

berecognised,takingintoaccountfutureforecastsand

likelyR&Dcredits,withaprudentapproachtakenshould

theirexistencenotbeconsideredprobable.

• Debtors,specificallyloans(note13)

Thegroupholdstwoloanswhichrequirejudgement.

Theirfuturerecoverabilityisdeterminedthrough

viewingpaymentcomplianceversusagreedpayment

datesandloanee’sfuturebusinessmodelandfinancial

forecasts.Wheresufficientuncertaintyexists,a

provisionismade.Judgementisalsorequiredin

determiningthefairvalueoftheloanwhichiscalculated

usingappropriateassessmentsofmarketrates.

8382


2. SEGMENTAL INFORMATION – GROUP AND COMPANY 3. REMUNERATION OF DIRECTORS AND KEY MANAGEMENT

Racing administration 2018

£’000

Data licensing 2018

£’000

Total 2018

£’000

Turnover

UnitedKingdomandRepublicofIreland 34,701 1,899 36,600

Total sales - Group 34,701 1,899 36,600

Subsidiaryracingadministrationrevenue (645)

Intragrouprevenue(Companyonly) 358

Total sales - Company 34,414

Total operating profit before interest and taxation 1,212 53 1,265

Net assets / (liabilities) 1,979 (439) 1,540

2018 £’000

2017£’000

NJRust 394 380

SRHarman 86 100

AWKMerriam 27 27

DLWhyte 27 27

JWSaumarezSmith 27 27

ADuncan 37 27

EWilmott - 25

JAHarrington 22 27

ENHarwerth 27 27

JRArnold 27 27

SirPRStephenson 35 35

VACurrie 27 27

Total 736 756

Number of directors

2018 2017

Retirementbenefitsareaccruingtothefollowingnumberofdirectorsunder:

Moneypurchaseschemes 1 1

Racingadministration2017

£’000

Datalicensing2017

£’000

Total2017

£’000

Turnover

UnitedKingdomandRepublicofIreland 32,708 2,009 34,717

Totalsales-Group 32,708 2,009 34,717

Intragrouprevenue(Companyonly) 528

Totalsales-Company 33,236

Totaloperatingprofitbeforeinterestandtaxation 1,262 107 1,369

Netliabilities (7,922) (548) (8,470)

TheGrouphastwoclassesofbusiness,datalicensingandracingadministration,bothofwhichoriginatein

theUK.Itisnotpossibletosplittheoperatingprofitbeforeinterestandtaxationorthenetassets/liabilities

bygeographicaldestination.

TheremunerationpayabletoeachofthedirectorsofBritishHorseracingAuthorityLimitedfortheyearwas:

ThecostsofNJRust,whowasChiefExecutive,arealsorepresentedwithinthecostsincludedinnote4.

Theaggregateofemolumentsandamountsreceivableunderlongtermincentiveschemesofthehighestpaid

directorwas£394,000(2017:£380,000),andCompanypensioncontributionsof£15,910(2017:£24,300)weremadetoa

moneypurchaseschemeonhisbehalf.

KeymanagementpersonnelcompensationforthegroupfortheyearwhichincludesthetotalcostsoftheBoardplus

Executiveteamwas£2,411,000(2017:£2,515,000)

8584


4. STAFF NUMBERS AND COSTS 5. EXPENSES AND AUDITOR’S REMUNERATION - GROUP

6. INTEREST ON LOANS RECEIVABLE - GROUP

7. OTHER INTEREST RECEIVABLE AND SIMILAR INCOME

TheaveragenumberofpersonsemployedbytheCompanyisshownbelow:

Theaggregatepayrollcostsofthesepersonswereasfollows:

Allstaffinthegroupareemployedbythecompany,howevertheircostsareallocatedbetweenthecompanyand

GreatBritishRacingLimiteddependingupontheactivitiestheyperform.Toprovideclaritytothereaderthenumber

ofemployeesofBHA,whosecostsareincludedinBHAareshownunderCompany*andthenumberofstaffemployed

byBHAincludingthosewhosecostsarerechargedelsewhereareshowninGroupandCompany.

Group and Company Company*

2018 Number

2017Number

2018 Number

2017Number

Permanentstaff 253 244 240 232

Sessionalstaff 18 26 17 25

271 270 257 257

Group Company

2018 £000

2017£000

2018 £000

2017£000

Wagesandsalaries 11,320 10,895 10,840 10,509

Pensioncosts 1,357 1,296 1,312 1,261

Socialsecuritycosts 1,240 1,204 1,187 1,153

13,917 13,395 13,339 12,923

2018 £’000

2017£’000

Includedinoperatingprofitarethefollowing:

Depreciation/amortisationchargefortheyear:

Tangibleownedfixedassets 294 316

Intangibleownedfixedassets 430 456

Lossondisposaloffixedassets 11 -

Impairmentcharges - 148

Operatingleases:

Buildingrentals 867 852

Carleases 382 376

Photocopierleases 40 47

Auditor’sremuneration:

Auditofthesefinancialstatements 42 44

Amountsreceivablebyauditorsandtheirassociatesinrespectof:

Auditoffinancialstatementsofsubsidiariesofthecompany 12 14

Taxationcomplianceservices - 25

Othertaxadvisoryservices - 9

Allotherservices - 1

2018 £’000

2017£’000

EffectiveinterestonfairvalueofBCSloan 64 -

ContractualinterestonBCSloan 36 -

100 -

GROUP 2018 £’000

2017£’000

Bankinterest 17 17

17 17

COMPANY 2018 £’000

2017£’000

Bankinterest 14 12

14 12

8786


8. INTEREST PAYABLE AND SIMILAR EXPENSES - GROUP AND COMPANY

9. TAXATION

2018 £’000

2017£’000

Interestonassets (1,820) (1,966)

Interestonliabilities 2,254 2,409

Netinterestexpenseonnetdefinedbenefitliabilities 434 443

GROUP 2018 £’000

2017£’000

AnalysisofcurrenttaxrecognisedinprofitandlossUKcorporationtaxat19%(2017:19.25%)

Currenttax

Taxonprofitfortheyear 43 (25)

Adjustmentinrespectofpriorperiods (7) (141)

Totalcurrenttax 36 (166)

Deferredtaxcreditfortheyear (56) (53)

Totaltaxcredit (20) (219)

COMPANY 2018 £’000

2017£’000

AnalysisofcurrenttaxrecognisedinprofitandlossUKcorporationtaxat19%(2017:19.25%)

Currenttax

Adjustmentinrespectofprioryears (11) (137)

Totalcurrenttax (11) (137)

Deferredtaxcreditfortheyear (56) (36)

Totaltaxcredit (67) (173)

Reconciliationofeffectivetaxrate 2018 £’000

2017£’000

Profitexcludingtaxation 948 943

TaxusingtheUKcorporationtaxrateof19%(2017:19.25%) 180 182

Effectsof:

Expensesnotdeductiblefortaxpurposes 98 28

Pensioncostsnotimmediatelydeductible (123) (138)

R&Dtaxcreditstooffsettradingprofits (112) (180)

R&Dtaxcreditsexchangedforcash (56) (137)

(over)/underprovidedinprioryear (7) (4)

Capitalallowancesinexcessofdepreciation - 30

Totalcurrenttaxcredit(seeabove) (20) (219)

Reconciliationofeffectivetaxrate 2018 £’000

2017£’000

Profitexcludingtaxation 778 1,056

Currenttaxat19%(2017:19.25%) 148 203

Effectsof:

Expensesnotdeductiblefortaxpurposes 86 49

Pensioncostsnotimmediatelydeductible (123) (138)

R&Dtaxcreditstooffsettradingprofits (112) (180)

R&Dtaxcreditsexchangedforcash (56) (137)

(Over)/underprovidedinprioryear (11) -

Capitalallowancesinexcessofdepreciation 1 30

Totalcurrenttax(credit)(seeabove) (67) (173)

TheCompanyhasclaimedR&Dtaxcreditsfor2017whichwereexchangedforcash.Thisamountof£47,000(2017:

£137,000)wasreceivedinJanuary2019.TheGroupwillcontinuetoseektoclaimthesegoingforward,where

appropriate,andwillincludeanappropriateamountindeterminingthecurrentyeartaxcharge,bothinoffsetting

tradingprofitsbutalsoasacash-invalue.Claimsinrespectof2018havebeenaccruedinthe2018taxcomputation.

TheCompanyhasclaimedR&Dtaxcreditsfor2017whichwereexchangedforcash.Thisamountof£47,000(2017:

£137,000)wasreceivedinJanuary2019andwas£11,000higherthanpreviouslyprovided.Thisisdisclosedas

anadjustmentinrespectofprioryear.TheCompanywillcontinuetoseektoclaimthesegoingforward,where

appropriate,andwillincludeanappropriateamountindeterminingthecurrentyeartaxcharge,bothinoffsetting

tradingprofitsbutalsoasacash-invalue.Claimsinrespectof2018havebeenaccruedinthe2018taxcomputation.

Factors that may affect future tax charges:

Adeferredtaxassetof£56,000(2017:£36,000)hasbeenrecognisedinthebalancesheetinrespectofanticipated

R&Dcredits.Inaddition,£1,193,000(2017:£2,598,000)hasnotbeenrecognisedontheCompany’spensionscheme

liability.Thisisduetotheuncertaintyoftherebeingsufficienttaxableprofitsinfutureyearstoenablesuchtax

Factors that may affect future tax charges:

Adeferredtaxassetof£56,000(2017:£53,000)hasbeenrecognisedinthebalancesheetinrespectofanticipated

R&Dcredits.Inaddition,£1,193,000(2017:£2,598,000)hasnotbeenrecognisedontheGroup’spensionscheme

liability.Thisisduetotheuncertaintyoftherebeingsufficienttaxableprofitsinfutureyearstoenablesuchtax

deductionstobeclaimed.Therearealsounrecognisedtradinglossesof£383,000(2017:£383,000)whichagainare

unabletoberecognisedduetoinsufficienttaxableprofitsinfuturetousethemagainst.

ReductionsintheUKcorporationtaxrateto19%(effective1April2017)weresubstantivelyenactedon26October

2015,andanadditionalreductionto17%(effective1April2020)wassubstantivelyenactedon6September2016.

GiventheCompany’sexpectationthatitwillcontinuetomakesmallprofitsandreceivegrouprelief,theimpactofa

reductioninfuturecorporationtaxratesisexpectedtobeminimal.

8988


deductionstobeclaimed.Therearealsounrecognisedtradinglossesof£383,000(2017:£383,000)whichagainare

unabletoberecognisedduetoinsufficienttaxableprofitsinfuturetousethemagainst.

ReductionsintheUKcorporationtaxrateto19%(effective1April2017)weresubstantivelyenactedon26October

2015,andanadditionalreductionto17%(effective1April2020)wassubstantivelyenactedon6September2016.

GiventheCompany’sexpectationthatitwillcontinuetomakesmallprofitsandreceivegrouprelief,theimpactofa

reductioninfuturecorporationtaxratesisexpectedtobeminimal.

Thesecostsrelatetoracingspecificsoftwareandsystemdevelopmentcommissionedfromthirdpartiesand

areeitheramortisedover4yearsforexternaldevelopmentorovertheremaininglifeofthecontracttowhich

thedevelopmentrelates.Thismethodofamortisationisbelievedtobefairandappropriateandrepresentthe

usefuleconomiclifeoftheassetinthemostappropriatemanner.Theamortisationchargeisincludedwith

administrativeexpenses.

10. INTANGIBLE FIXED ASSETS – GROUP AND COMPANY

11. TANGIBLE FIXED ASSETS

Development costs £000

Assets under construction £000

Total £000

Cost

At1January2018 2,142 413 2,555

Additions 256 - 256

Transferstocompleted 153 (153) -

Transferstotangibleassets - (219) (219)

Disposals - (41) (41)

At 31 December 2018 2,551 - 2,551

Amortisation

At1January2018 1,169 - 1,169

Chargefortheyear 430 - 430

At 31 December 2018 1,599 - 1,599

Net book value

At 31 December 2018 952 - 952

At1January2018 973 413 1,386

GROUP

Leasehold improvements

£000

Fixtures, fittings and office equipment

£000Total £000

Cost

At1January2018 1,224 3,146 4,370

Additions 41 146 187

Transfers - 219 219

Disposals - (1,525) (1,525)

At 31 December 2018 1,265 1,986 3,251

Depreciation

At1January2018 1,127 2,637 3,764

Chargefortheyear 68 226 294

Disposals - (1,522) (1,522)

At 31 December 2018 1,195 1,341 2,536

Net book value

At 31 December 2018 70 645 715

At1January2018 97 509 606

COMPANY

Leasehold improvements

£000

Fixtures, fittings and office equipment

£000Total £000

Cost

At1January2018 1,224 3,121 4,345

Additions 41 146 187

Transfers - 219 219

Disposals - (1,525) (1,525)

At 31 December 2018 1,265 1,961 3,226

Depreciation

At1January2018 1,127 2,627 3,754

Chargefortheyear 68 220 288

Disposals - (1,522) (1,522)

At 31 December 2018 1,195 1,325 2,520

Net book value

At 31 December 2018 70 636 706

At1January2018 97 494 591

9190


12. FIXED ASSET INVESTMENTS - COMPANY 13. DEBTORS

14. CASH – GROUP AND COMPANY

Shares in Group Undertakings

£000Total £000

Cost

At1Januaryand31December2018 4,004 4,004

Provision

At1January2018 (548) (548)

Impairmentchargefortheyear - -

At31December2018 (548) (548)

Net book value

At 31 December 2018 3,456 3,456

At 1 January 2018 3,456 3,456

Countryofincorporation

Numberofshares

Classofsharesheld

Ownership2018%

Ownership2017%

BritishHorseracingDatabaseLimited

UK 4,003,932 Ordinary 100% 100%

BritishHorseracingLimited* UK 2 Ordinary 100% 100%

BritishHorseracingBoardLimited*

UK 2 Ordinary 100% 100%

RacingForAll* UK 2 Ordinary 100% 100%

HorseracingRegulatoryAuthorityLimited*

UK 1,000 Ordinary 100% 100%

Countryofincorporation

Numberofshares

Classofsharesheld

Ownership2018%

Ownership2017%

GreatBritishRacingLimited(formerlyRacingEnterprisesLimited)

UK 4,003,932 Ordinary 99.99985% 99.99985%

BritishChampionsSeriesLimited

UK 150 Ordinary 15.0% 15.0%

The Company has the following direct investments:

The Company has the following indirect investments through its subsidiaries:

Thefourcompaniesmarkedwith*arealldormantcompaniesandnolongertrade.Alloftheabovecompanieshave

theirregisteredofficeat75HighHolborn,London,WC1V6LS.

Theaboveloanbalanceof£2,022,000representsanamountdrawndownbyBCSLimited.Thisloanwillberepaid

between1January2016and31December2025overwhichtimeinterestof£486,000willhavebeenearned.The

interestratechargedvariesaccordingtowhichelementoftheloanitrelatestoandinaccordancewithFRS102

usingtheeffectiveinterestmethod,£100,000isrecognisedin2018,with£36,000beingcontractualinterestand

£64,000beingeffectiveinterestmarketrate‘top-up’onthefairvalueoftheloan.Thenextrepaymentof£363,000is

scheduledforDecember2019atwhichstageafurther£97,000oftotalinterestwillberecognised.£380,000hasbeen

repaidtodate.

TheloantoBCSLimitedisstatedatfairvaluecalculatedusingamarketrate‘top-up’overandabovethediscount

rateimplicitintheloanagreementbaseduponthetimingandvalueoftherepayments.Allotherfinancial

instrumentsareheldatamortisedcostastheyarerepayableondemand.

Includedwithinthegroupcashbalanceof£12,463,000(2017:£12,415,000)andcompanycashbalancesof£10,504,000

(2017:£10,811,000)areringfencedbalancesof£5,567,000(2017:£5,981,000).

Alloftheabovecompanieshavetheirregisteredofficeat75HighHolborn,London,WC1V6LS.

Group Company

2018 £000

2017£000

2018 £000

2017£000

Tradedebtors 2,952 4,104 2,952 4,104

Amountsowedbygroupundertakings - - 282 180

Corporationtaxasset 74 164 47 137

Deferredtaxasset 56 53 56 36

Otherdebtors 2,837 2,721 2,837 2,721

VAT - 29 - -

LoanowedbyBCSLimited 2,022 2,076 - -

Prepaymentsandaccruedincome 1,572 899 1,366 694

9,513 10,046 7,540 7,872

Duewithinoneyear 7,798 8,063 7,484 7,828

Dueafteroneyear 1,715 1,983 56 44

9,513 10,046 7,540 7,872

9392


15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR 17. PENSION SCHEME

16. CARRYING AMOUNT OF FINANCIAL INSTRUMENTS

Group Company

2018 £000

2017£000

2018 £000

2017£000

Tradecreditors 2,145 2,932 2,002 2,695

Amountowedtogroupundertakings - - 68 71

Corporationtax 33 2 - -

Othertaxesandsocialsecurity 744 746 660 740

Othercreditors 10,290 10,776 10,212 10,705

Accrualsanddeferredincome 664 552 664 552

13,876 15,008 13,606 14,763

Group Company

2018 £000

2017£000

2018 £000

2017£000

Assetsmeasuredatamortisedcost 20,274 21,316 16,575 17,816

Liabilitiesmeasuredatamortisedcost 12,749 13,877 12,596 13,640

The carrying amounts of the financial assets and liabilities include:

Net pension liabilityFinancialassetsmeasuredatamortisedcostcomprisecashatbank,tradedebtors,amountsowedbygroup

undertakings,otherdebtorsandloanowedbyBCSLimited.

Financialliabilitiesmeasuredatamortisedcostcomprisetradecreditors,amountsowedbygroupundertakings,

othercreditorsandaccruals.

AlloftheGroup’sfinancialassetswiththeexceptionoftheloanfromGBRtoBCS,arerepayableondemand.

Similarlyallfinancialliabilitiesarepayableondemand.

InrelationtotheloanfromGBRtoBCSthefairvaluehasbeendeterminedusingadiscountrateof4.82%whichis

believedtobeareasonablereflectionofthemarketrateofinterest.

ThedirectorsbelievethatthereisminimalcreditriskgiventhesuccessofBCSandunlessthenextrepaymentin2019

isnotmadeinaccordancewiththerepaymentplanthenitwillcontinuetotakeapositiveviewoftherecoverability

andthereforefairvalueofthisloangoingforward.

Overview

TheCompanyoperatesapensionschemeforitsemployees,theBritishHorseracingAuthorityPensionScheme(‘the

Scheme’).TheSchemehastwosections,aDefinedBenefit(‘DB’)sectionandaDefinedContribution(‘DC’)section.

TheDCsectionisalsousedforthepurposesofautoenrolment.

Defined Benefit Section

TheDBsectionwasclosedtofutureaccrualon31December2015.Priortothis,theDBsectionhasbeenbasedupon

careeraveragerevaluedearnings.

ThelatestfullactuarialvaluationoftheDBsectionoftheSchemewascarriedoutat31December2017andwas

updatedforFRS102purposesto31December2018byaqualifiedindependentactuary.

Thecompanywillcontribute£1,304,000asanannualdeficitrepairpaymentin2019andhasarecoveryplanagreed

withthetrusteesoftheSchemethatisinplaceuntilMay2026.

ThetrusteesoftheSchemehaveaguaranteefromtheHorseraceBettingLevyBoard(‘HBLB’)thatiftheBHAdoes

notmakeitsannualpaymentsforeithertheannualdeficitpaymentoritsongoingservicescontributionsthenthe

HBLBwillmakethesepayments.Thisguaranteeiseffectiveuntiltheearlierof30September2024orthedateat

whichtheSchemedeficitusingthe2007actuarialassumptionshasbeenfullypaidoff.

InadditiontheEmployermeetsthecostsofadministeringtheScheme,thecostoflumpsumdeathinservice

insurancepremiumsandLeviespayablebytheScheme.

Value at 31 December 2018

£’000

Valueat31December2017

£’000

Definedbenefitobligation (78,048) (91,576)

Planassets 69,821 73,661

Deficit (8,227) (17,915)

Relateddeferredtaxasset - -

Netpensionliability (8,227) (17,915)

9594


Movements in present value of defined benefit obligation:

The major assumptions used in this valuation by the actuary were (in nominal terms):Movements in fair value of plan assets:

Expense recognised in the profit and loss account:

Scheme assets

ThefairvalueoftheScheme’sassets,whicharenotintendedtoberealisedintheshorttermandmaybesubjectto

significantchangebeforetheyarerealised,were:Value at 31

December 2018 £’000


£’000

Atstartofyear 91,576 87,776

Currentservicecost - -

Pastservicecost 78 -

Interestcost 2,254 2,409

Actuarial(gains)/lossesduetoassumptionchanges (8,828) 4,116

Experience(gain)/loss (4,152) 757

Contributionsbymembers - -

Benefitspaid (2,880) (3,482)

Atendofyear 78,048 91,576


£’000


£’000

Equitiesandotherreturnseekingassets 17,210 19,712

Bondsandotherdefensiveassets 49,519 51,045

Property 2,442 2,364

Cash 640 529

Annuity 10 11

Totalmarketvalueofassets 69,821 73,661

Actualreturnonplanassets (2,118) 4,622

31 December 2018

31December2017

Discountrate 2.80% 2.50%

Inflation(ConsumerPriceIndex) 2.80% 2.80%

Inflation(RetailPriceIndex) 3.60% 3.60%

Pensionincrease(RPImax5%) 3.40% 3.40%

Pensionincrease(RPImax2.5%) 2.30% 2.30%

Pensionincrease(CPImax2.5%) 2.10% 2.10%


£’000


£’000

Atstartofyear 73,661 71,363

Interestonassets 1,820 1,966

Actuarialgain/(loss)onschemeassets (3,938) 2,656

Contributionsbyemployer 1,158 1,158

Contributionsbymembers - -

Benefitspaid (2,880) (3,482)

Atendofyear 69,821 73,661


£’000


£’000

Currentservicecost - -

Pastservicecost 78 -

Netinterestonnetdefinedbenefitliability 434 443

Totalexpenserecognisedinprofitandloss 512 443

Thetotalamountrecognisedinothercomprehensiveincomeisagainof£9,042,000(2017:lossof£2,217,000).

Cumulativeactuariallossesreportedinothercomprehensiveincomeforaccountingperiodsendingonorafter22

June2002,arelossesof£13,383,000(2017:£22,425,000).

Invaluingtheliabilitiesofthepensionfundat31December2018,mortalityassumptionshavebeenmadeasindicated

below.

Theassumptionsrelatingtolongevityunderlyingthepensionliabilitiesatthebalancesheetdatearebasedon

standardactuarialmortalitytablesandincludeanallowanceforfutureimprovementsinlongevity.Theassumptions

areequivalenttoexpectinga65-yearoldtoliveforanumberofyearsasfollows:

• Currentpensioneraged65:22.4years(male),24.4years(female).(2017:22.9years(male),25.0years(female))

• Futureretiree,currentlyaged45,uponreaching65:23.8years(male),25.9years(female).(2017:24.2years(male),

26.5years(female))

Theassumptionsusedbytheactuaryarechosenfromarangeofpossibleactuarialassumptionswhich,duetothe

timescalecovered,maynotnecessarilybeborneoutinpractice.

9796


The history of the plans for the current and prior periods is as follows:

Experience adjustments:

Analysis of amount recognised in other comprehensive income (continued)

Analysis of amount recognised in other comprehensive income

2018 £000

2017£000

2016£000

2015£000

2014£000

Presentvalueofschemeliabilities (78,048) (91,576) (87,776) (72,126) (71,668)

Fairvalueofschemeassets 69,821 73,661 71,363 59,325 60,053

Deficit (8,227) (17,915) (16,413) (12,801) (11,615)

Year ending 31 December

2018

Yearending31December

2017


2016

Differencebetweentheexpectedandactualreturnonschemeassets–gain/(loss):

Amount(£000) (3,938) 2,656 10,869

Percentageofyearendschemeassets 6% 4% 15%

Experiencegainsand(losses)onschemeliabilities:

Amount(£000) 4,152 (757) 318

Percentageofyearendschemeliabilities 5.3% 0.8% 0.3%

Totalamountrecognisedinothercomprehensiveincome–gain/(loss):

Amount(£000) 9,042 (2,217) (4,348)

Percentageofyearendschemeliabilities 11.5% 2% 5%


2015


2014

Actuarial(loss)/gainonschemeassets (2,396) 8,090

Changesinactuarialassumptions 3,758 (9,371)

Experience(losses)/gains (3,147) -

Actuarial(loss)/gainrecognisedinothercomprehensiveincome (1,785) (1,281)

Year ending 31 December

2018


2017


2016

Actuarial(loss)/gainonschemeassets (3,938) 2,656 10,869

Changesinactuarialassumptions 8,828 (4,116) (15,535)

Experiencegains/(losses) 4,152 (757) 318

Actuarialgain/(loss)recognisedinothercomprehensiveincome

9,042 (2,217) (4,348)

TheDBelementoftheschemewasclosedtofutureaccrualon31December2015andthereforefrom2016onwards,

theonlycontributionsbeingpaidintothissectionrelatetotheagreeddeficitrepaircontributionsattherates

recommendedbytheSchemeActuary.CashcontributionstotheDBelementamountedto£1,158,000totheScheme

in2018(2017:£1,158,000).

Defined contribution section

TheCompany’scontributiontothedefinedcontributionschemeischargedtotheprofitandlossaccountintheperiod

inwhichtheyarepaidandamountedto£1,311,987in2018(2017:£1,261,356).

Theamountpayabletothepensionfundasat31December2018was£214,000(2017:£209,000)

InadditiontheCompanypaid£23,000intothepersonalpensionschemesofcertainemployees(2017:£23,000).

18. CONTINGENT LIABILITIES

19. LIABILITY OF MEMBERS

In2016,organisationsrepresentingBritishRacingenteredintothreeyearauthorisedbettingpartneragreements

withanumberofon-linebettingoperators.UndertheseagreementspaymentswerepaidtotheHorseraceBetting

LevyBoard.

Threeoftheseagreementsincludedarebateclausewhichcameintoforceshouldcertaineventsoccurduringthe

termoftheseagreements.

Ineachofthesethreecases,intheviewofthedirectors,thereisnolegalobligationontheCompanytomakegood

theserebateclaims.However,theultimatesettlementoftheseclaimsisamatterofongoingdiscussionsbetween

theorganisationsrepresentingBritishRacingandtheHorseraceBettingLevyBoard.

Asatthedateofapprovalofthesefinancialstatements,thelevelofanyBritishHorseracingAuthoritycontributionto

thissettlement,ifany,cannotbereliablyquantified.

ThefourmembersoftheCompanyhaveundertakentocontributeasumnotexceeding£1eachtomeettheliabilities

oftheCompanyintheeventthatitiswoundup.

9998


20. COMMITMENTS

21. ANALYSIS OF NET FUNDS

22. RELATED PARTY TRANSACTIONS

TheGrouphasacontractwithWeatherbysThoroughbredLimitedfortheprovisionofsubstantialracingandgeneral

administrationserviceswhichexpiresattheendof2020butwhichissubjecttothreeyearnotice,asyetnoticehas

notbeenserved.

At31December2018theGroupandCompanyhadcommitmentsundernon-cancellableoperatingleasesasfollows:

Theleasecommitmentsincludedinotherrelatetomotorcars.

Identity of related parties with which the Company has transacted

Thecompanyhastransactedwiththefollowingrelatedparties,allofwhicharerelatedbyvirtueofoneoftheir

employees/appointments/directorsbeingamemberoftheBoardoftheCompany,orasamemberbodyof

theCompany.

• RacecourseAssociationLimited

• RacehorseOwnersAssociationLimited

• ThoroughbredBreeders’Association

• FakenhamRacecourseLimited

• NationalTrainersFederation

• Horsemen’sGroup

• BritishChampionsSeriesLimited

• TheHamiltonParkRacecourseCompanyLimited

• Point-to-PointAuthorityLimited

• RetrainingofRacehorsesLimited

• RacingtoSchoolLimited

• JockeyClubRacecoursesLimited

• JockeyClubEstates

• RacingWelfare

• BritishHorseracingDatabaseLimited

• GreatBritishRacingLimited

• CrimestoppersEnterprisesLimited

• HorseraceBettingLevyBoard

2018 2017

Land and buildings

£000

Other

£000

Landandbuildings

£000

Other

£000

Expiring:

withinoneyear 852 322 849 297

betweenoneandfiveyearsinclusive 280 410 1,112 227

Overfiveyears - - - -

1,132 732 1,961 524

At 1 January 2018 £000

Cash flow At 31 December 2018 £000

Cashatbankandinhand 5,660 462 6,122

Ringfencedcash 5,981 (414) 5,567

Shorttermdeposits 774 - 774

Total 12,415 48 12,463

101100


Other related party transactions

Sales and recharges to

Administrative expenses incurred from

2018 £000

2017£000

2018 £000

2017£000

RacecourseAssociationLimited 19 43 - 1

RacehorseOwnersAssociationLimited 76 98 - -

ThoroughbredBreedersAssociation 64 37 - -

FakenhamRacecourseLimited 190 185 - -

TheHamiltonParkRacecourseCompanyLimited 263 256 - 6

NationalTrainersFederation 1 1 1 -

Horsemen’sGroup - - (75) (50)

PointtoPointAuthorityLimited 120 145 - -

RetrainingofRacehorsesLimited - - - 1

RacingtoSchoolLimited 7 5 - -

JockeyClubRacecoursesLimited 5,121 8 25 26

JockeyClubEstates 2 - 6 2

RacingWelfare 2 4 5 2

HorseraceBettingLevyBoard - 44 - -

GreatBritishRacingLimited 911 969 - 10

BritishHorseracingDatabaseLimited 5,312 5,365 5,327 5,380

CrimestoppersEnterprisesLimited - - 9 9

BritishChampionsSeriesLimited 489 595 - -

12,577 7,755 5,298 5,387

Receivables outstanding Creditors outstanding

2018 £000

2017£000

2018 £000

2017£000

RacecourseAssociationLimited 8 9 - -

RacehorseOwnersAssociationLimited 5 27 - -

ThoroughbredBreeders’Association 1 - - -

TheHamiltonParkRacecourseCompanyLimited - - - -

FakenhamRacecourseLimited - - - -

NationalTrainersFederation - - 1 -

Horsemen’sGrouploan 200 200 - -

Horsemen’sGrouploanprovision (125) (200) - -

Point-to-PointAuthorityLimited - 44 - -

RetrainingofRacehorsesLimited 333 171 - -

RacingtoSchoolLimited 110 62 - -

JockeyClubRacecoursesLimited 7 - 1 -

JockeyClubEstates - - - -

RacingWelfare - - - -

HorseraceBettingLevyBoard 39 1 - -

GreatBritishRacingLimited 282 180 - -

BritishHorseracingDatabaseLimited - - 68 71

CrimestoppersEnterprisesLimited - - - -

BritishChampionsSeriesLimited 2,024 2,078 - -

2,884 2,572 70 71

All figures within the document are correct as of 25 September 2019.

Certain images within this publication are reproduced with the permission of Focusonracing.com

British Horseracing Authority

75 High Holborn, London, WC1V 6LS

Switchboard:020 7152 0000

Mediaenquiries:020 7152 0166

www.britishhorseracing.com

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