Thanks for the comprehensive explanation Martin. So just to clarify if I understand correctly;
If we want to plot our maps with respect to magnetic north (to be compatible with 'old' uncorrected surveys for example) then we do not specify declination and we do not specify any co-ordinate system. If we specify a grid to be plotted it will be aligned with magnetic north. Also if we do specify a co-ordinate system and; a) adopt Grid North, the north arrow would plot parallel to the (NS) grids, or, b) adopt True North, the north arrow would NOT (necessarily) be parallel to any of the grids. Thanks Bruce
