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2023-03-31-accounts

For the year ended 31 March 2023 Annual Report and Financial Statements

Registered Charity No. 1003314 Company No. 02620879 (England and Wales)

Thank you all so much for taking such amazing care of us. You have managed to take us from dark places at times and made us laugh, smile and feel happy again. Starting to come here was one of the best decisions ever! It really has been our ‘happy place.’

Welcome to our Annual Report 2022 to 2023

Our Strategic Plan for the period 2020 to 2025 set out ambitions which would lead to substantial growth in income to enable the expansion of our care services. Coronavirus (COVID-19) during 2020 to 2022 produced a seismic shock to these ambitions and retrenchment became imperative. A Response Plan was agreed in which we confirmed that our overarching objectives held good but that it would take at least 2 years to return to previous levels of service and income.

This Annual Report covers the period 2022 to 2023 when the Government finally removed the domestic legal restrictions for COVID-19. We still, however, had to follow the NHS guidance for quite some time into the year. By the end of the year, we were welcoming increased numbers of children, young people and their families back into our 3 hospices as well as continuing to deliver care virtually and in their homes. This is now our established Care Model offering different choices to families of how they receive support. We are caring for children and young people with increasingly complex needs that require greater levels of expertise and we have also seen an increase in the number of babies referred for end of life care.

Throughout the year we have continued to experience the impact of staff or their close contacts testing positive for COVID-19. Coupled with the impact of the national shortage of qualified nurses with the skills and experience we require to deliver complex care to children and young people with life-limiting illnesses, it is fair to say the year has been challenging. Despite this, we are pleased to report that we

consistently deliver our care and support to a high standard, often over and above those required by regulation.

Notwithstanding the above, we were able to make further substantial investment in our care services.

Supported by our prioritisation tool, the Hospice, Home and Virtual Care Model was further developed. This assisted with making sure our resources were better targeted, ensuring that we were able to support families when they needed us most.

In financial terms the year produced unexpectedly positive results, income from voluntary fundraising and retail profitability recovered to pre-COVID-19 levels. In particular, the charity experienced an unexpectedly very large rise in legacy income. The latter was a major contributory factor to a year end surplus which in turn enables us to sustain our investment in care services as well as meet the severe challenges caused by inflationary pressures.

For Children’s Hospice South West to thrive we first rely on the continued incredible support from all parts of the community. This enables our staff to provide the best possible service. To supporters, volunteers and staff we extend our grateful thanks for enabling Children’s Hospice South West to thrive in challenging circumstances.

We commend this Annual Report and Financial Statements to you.

Tricia Morris Eddie Farwell MBE Chair of Trustees Co-Founder and Chief Executive

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Contents

Trustees’ report (including the strategic report) for the year ended 31 March 2023 ..............................3

Our objectives and activities ........................3 Our purpose, vision and ethos ........................................... 3 Organisational principles ..................................................... 3 Our core values and behaviours ........................................ 4 Our strategy ............................................................................ 5 Our achievements in 2022 to 2023 .................................. 6 Our key objectives for 2023 to 2024 ............................... 7 How we have supported our beneficiaries ..................... 8 The difference we make; meet some of our families ................................................12 Income generation ..............................................................14 Our financial performance .......................... 16 Our financial reserves ........................................................18 Our investment approach .................................................18 How we manage risks and uncertainties .......................19 Statement of Trustees’ responsibilities ..........................21 Financial statements ......................................22 Accounting policies ..........................................41 Basis of preparation and accounting policies ...............41 Audit report .........................................................45 Independent auditor’s report to the members of CHSW .................................................45 Structure, governance and management ............................................ 48 Reference and administration ...................52 Fundraising standards .....................................53 Valuing our supporters and upholding high standards ..................................................53

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Our objectives and activities

Our purpose, vision and ethos

Our purpose is to make the most of short and precious lives and to put children, young people and their families at the centre of all we do.

Our vision is to provide high quality care to every child and young person in the South West who may not live to their 18th birthday.

Our ethos is to ensure that everyone (Trustees, staff and volunteers) places children, young people and their families at the centre of the organisation.

To achieve this, everyone will be expected to promote a strong, caring, community environment, characterised by a culture of sensitivity, trust, consideration and respect for others.

Organisational principles

Our ethos gives rise to a set of principles which determine how Children’s Hospice South West (CHSW) as an organisation operates on a day to day basis. We will:

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Our core values and behaviours

Everyone working for, or on behalf of CHSW will act to or with:

C are and respect for each other: H onesty, openness and accountability: S trive for excellence: Recognising and Behaving with Seeking to accepting our openness, integrity continuously responsibility and honesty

Embracing and recognising the importance of difference and diversity.

Making the best use of organisational resources; having regard for sustainability, efficiency and respect for the environment.

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Our strategy

Following a review in September 2022, our strategic aims extending to March 2026 were reviewed, extended and agreed:

Care

We remain committed to providing high quality, safe care and support to children and young people who may not live to their 18th birthday. This includes hospice care for the whole family and being responsive when families need us most, including at the end of life and support during bereavement. Our focus is to develop our care sustainably, ensuring we utilise our 3 hospice bases and be there when families need us most.

Strategic priorities to deliver this aim by 2026:

Funding

To afford our care objectives by delivering a step change in income generation to deliver additional annual income in excess of £2 million (minimum) by 2026.

Strategic priorities to deliver this aim by 2026:

Marketing

To re-energise our brand awareness and re-establish our positioning, ensuring we remain a leading brand name in the South West and the charity of choice for charitable giving.

Strategic priorities to deliver this aim by 2026:

Progress against our strategic aims will be monitored, reviewed, and evaluated by the Senior Management Team (SMT) on a regular basis and by the Assurance Committees through Key Performance Indicators (KPIs) and Board reports at each meeting (currently 4 times per year).

These strategic objectives are due to be reviewed in November 2023 and will be considered in-line with any ongoing challenges in relation to the recruitment and retention of care staff.

Public benefit

The Trustees confirm that they have referred to the guidance contained in the Charity Commission’s general guidance on public benefit when reviewing the charity’s aims and objectives. The benefits are clearly set out in the achievement section on

page 6 to 13. The Trustees review the activities of the charity against its aims and objectives on an ongoing basis and are satisfied that all activities continue to be related to its purpose. The beneficiaries are children and young people living with

life-limited and life-threatening conditions and their families. A referral process is in place, with clear guidance on criteria, to ensure that those who meet the criteria are offered support by the charity.

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Our achievements in 2022 to 2023

2022 to 2023 objectves What we achieved
1To develop the service ofer of care
to families, while supportng
COVID-19 recovery with a focus
on increasing capacity and reach
of care services to children, young
people and families. This requires
recruitment, supportng the educaton
and development of our staf and
collaboraton with other providers.		 Hospice actvity signifcantly increased this year with 1,170 more
bed nights than the previous year, refectng increased actvity
across the 3 hospices as COVID-19 restrictons have lifed. We
have embedded our Care Model of hospice, home and virtual
support, enabling families to have choices while being responsive.
A collaboratve approach has reduced hospital stays enabling more
children to stay at home. Investment has led to an increase of nurses
and carers in each hospice. Despite COVID-19, we have supported
the training and development of Non-Medical Prescribers.
2To contnue to develop and embed
our Workplace Health, Safety and
Wellbeing Strategy in response to the
changing external environment with
partcular focus on emotonal and
fnancial wellbeing.		 2022 to 2023 focused on emotonal and fnancial wellbeing in
recogniton of the cost of living increase; a midyear back-dated pay
award was made to all staf in recogniton of this. Financial wellbeing
management guidance was rolled out to managers to support their
staf with signpostng to our Employee Assistance Programme.
Menopause awareness training commenced across the charity, and
our Managing Stress Framework was published.
3Acton our capital budget to support
our business infrastructure and
development.		 In the year, we spent more than £900k on capital investments to
improve and enhance our 3 hospices, retail network and business
infrastructure. While this spend was below our budgeted capital
plan, we will pursue this contnued investment into 2023 to 2024.
4With a new Fundraising Strategy in
place, we will return income to pre-
COVID-19 levels through community
fundraising and corporate partnerships
in 2022 to 2023. We also hope to
learn about how events return and
play a role in bringing people together
to raise funds for our vital work. Our
increased resource for Individual
Giving will help deliver a rejuvenated
strategy to maximise opportunites.		 Community fundraising income returned to pre-COVID-19 levels
and support from businesses is also recovering strongly. We have
welcomed back thousands of people to a broad range of events
including Rainbow Run, Bear Hunt and Santas on the Run which is
helping us plan future successful events.
5To contnue to look for more ft for
purpose shop sites and undertake
a refurbishment programme of our
existng shops. In additon to invest
more in the existng shop resource
model (to provide resilience) and invest
in the shop IT support.		 During the year, we refurbished and reopened 4 shops while
planning the refts of 3 others. We invested signifcantly in new
IT hardware and dedicated IT retail support; and undertook an
extensive procurement process to identfy a new Electronic Point of
Sale (EPoS) system to maximise retail Gif Aid. The implementaton
of this EPoS will begin in summer 2023. We contnue to increase paid
staf resources where it’s required to increase shop productvity.
6To contnue to develop fresh
marketng strategies to increase
donor acquisiton and retenton, and
reach new audiences, with a focus on
planning, brand engagement, content
development, analysis, and evaluaton.		 During the year, we reached more supporters through social media
presence, audio and visual content, and targeted Google and social
advertsing. We developed more strategic marketng plans around
donor journeys and individual communicatons plans using data
and analytcs to inform decisions. We sent more than 155 targeted
enewsleters and increased our database by 9k individual supporters.
We welcomed 38k visitors to our website with online donatons
totalling £323k during the year.

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Our key objectives for 2023 to 2024

The quality improvement priorities below are in-line with the priorities set out in the Strategic Plan and a continuation of last year’s:

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How we have supported our beneficiaries

Care activity; who we supporting

----- Start of picture text -----
parents or carers were supported
by CHSW in 2022/2023, a decrease
of 32 from the previous year.
991
560
children and young people
were supported by CHSW
in 2022/2023, a decrease
of 5 from the previous year.
were supported
siblings by CHSW in 2022/2023,
no change from the
previous year.
927
----- End of picture text -----

What type of activity have we seen?

6,715

total bed nights in 2022/2023. This is an increase

of 1,170 more bed nights than the previous year, which reflects the increased level of activity across the 3 hospices as COVID-19 restrictions have lifted.

4,094 2,102 family member night children or young stays in the hospices people bed nights in 2022/2023, in 2022/2023, an increase of an increase of 1,250 from the 399 from the previous year. previous year.

396 123 day visits in 2022/2023, Starborn ** a decrease of 530 from nights in the previous year but 2022/2023, is explained by the an increase of corresponding increase 51 from the of bed nights. previous year*.

2,477 1,617 1,235 867 parent or carer sibling night stays hospice resilience emergency bed nights stayed in in 2022/2023, an bed nights in nights in 2022/2023, 2022/2023, an increase of 736 2022/2023, an a decrease of increase of 514 from nights from the increase of 927 from 528 from the the previous year. previous year. the previous year. previous year.

*In addition to this our Care and Medical Teams provide support and advice to other professionals caring for children and young people who are not at the hospice.

**‘Starborn’ is the name given to the temperature controlled room in CHSW hospices that the children or young people stay in after death.

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Report from Vicky Stuckey, Head of Care and Registered Manager at Little Bridge House

As we continue to progress out of COVID-19 conditions of the last few years, it is so positive to have the opportunity to look back over the year and celebrate where we are and what has been achieved. The team here at Little Bridge House have been working hard to ensure that the families are supported in the best way.

Making memories

Christmas is a joyful time of year for most but we know it can be challenging for our families. Therefore as a team, we decided to understand what would support families at this time of year. Going to see Father Christmas or enjoying a Christmas movie is an activity enjoyed by children and young people everywhere, but may be difficult for children with complex needs whether it be because of access problems, having to undertake care when there isn’t a suitable place or managing the level of sensory stimulation involved. We decided to make the whole of December ‘Christmas month’ and held a variety of activities for our families to enjoy. Father Christmas visited several times during the month despite his very busy schedule and was prepared for the individual needs of the children coming to

see him. There were Christmas movies, craft activities, food and drink and lots of music. This was well attended and the feedback was good, both from families and our Care Team.

We also knew we had 2 families for who Christmas presented some specific challenges; the fragility of their children meant this was likely to be their last Christmas as a family. For one mum she wasn’t able to have her son at home so wouldn’t be able to spend the whole day with him. We felt it important to offer both families stays. They both readily accepted and were supported by the team to have the Christmas they wished for. The team ensured that the bed of the little girl was wheeled into the room with her family so they could all be together for lunch and present opening.

In these ways, the team supported a wide range of families to make Christmas memories to cherish.

What am I most proud of

How through the many changes and demands of the last few years, the core ethos has been maintained and our families have been kept at the centre of our efforts. The team have adapted wonderfully and have been so flexible and understanding of what is asked of them. Despite some pressures with staffing, the families have continued to receive responsive care that accounts

for all their needs. This year has felt like an opportunity to build on past successes, learn from challenges and shape our future.

There is an energy within the team and I am excited about what is to come.

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Report from Karen Greaves, Head of Care and Registered Manager at Charlton Farm

The team at Charlton Farm are very proud of our achievements during the last year and want to share a handful of them. We continue to open the hospice more and have recently stopped wearing face coverings, unless requested to do so by families. We are also delighted to be able to share meals with the children, young people and families again, which is a much-loved time for all of us.

Making memories

Jacob’s elves, Star and Rainbow, took him on a magical adventure to Bristol Rovers FC. The elves went above and beyond and organised for him to meet Father Christmas, his reindeer and Jacob’s favourite football player, Aaron Collins.

The Care Team elves share:

As Jacob is a fan of Bristol Rovers, we were able to secretly (or so we thought) facilitate a once-in-a-lifetime opportunity for Jacob to attend the club ground and to watch the game. Unbeknown to us all, Jacob was

well aware of this as he had read his mum’s emails. This really sums up Jacob’s ability to surprise us. Although he was aware he was going to the game, what he didn’t know was that he was also going to meet the team and was especially thrilled to meet Aaron Collins who is his favourite player.

Jacob had a brilliant day and was totally exhausted; we believe he came home with the contents of the gift shop in his chair!!

A big thank you to Bristol Rovers FC for giving Jacob a special day to remember.

What I am most proud of

It is hard to narrow down specific things that I am proud of. My team continue to amaze me with their dedication and high standards of care, often changing their rota at short notice. They strive to provide the best possible experience for children, young people and their families, frequently thinking outside the box to be creative with activities and special celebrations for them. The high levels of end of life

care and bereavement care have impacted the team, but we all remain proud and privileged to

play even a small part in providing support to families at such a difficult time.

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Report from Sam Hurse, Head of Care and Registered Manager at Little Harbour

I’d like to use this opportunity to share with you all the wonderful work we have been doing at Little Harbour during the past year. Showcasing how throughout COVID-19, we have adapted our ways of working to help children, young people and families who need us the most, wherever they may be, in-hospice or at home.

Making memories

As always, we keep our ethos of making the most of short and precious lives. With this in mind, we always try to make precious memories for our children, young people and families. Last summer we gave some families the opportunity to have a boat ride in collaboration with ‘Wet Wheels’. Wet Wheels is a charity that provides sea boat trips for disabled people and people with complex needs in a safe, fully accessible motor boat. In collaboration with Wet Wheels, we were able to send 96 family members on this safe

boat trip. This is an opportunity that sadly lots of people in wheelchairs or who have mobility issues don’t get to experience, so it was fantastic and very rewarding to see the families enjoying such a special day.

What I am most proud of

It is hard to pinpoint what I am most proud of as I am incredibly proud of the team at Little Harbour and the team ethic we have. I feel we always go above

and beyond to help support our families. This has been challenging at times with COVID-19 and the effect it has had on our care provisions. However, I feel

the team have been incredibly adaptable and flexible; always working extremely hard to give families much needed support.

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The difference we make; meet some of our families

Permission has been sought and obtained by the parents to tell their child’s story.

Alex and his family have been visiting Little Harbour since he was 4

and his future, taking into consideration his healthcare needs. Their main priority was for Alex to be comfortable and enjoy his life regardless of how long that may be. The family utilised support from Little Harbour in a variety of ways.

The Care Team tell Alex’s story.

Alex has been coming to Little Harbour since he was 4 with his mum Lucie, dad Sean and little sister Faye.

Alex has also enjoyed Music Therapy sessions during his years at Little Harbour and more recently he has had some virtual sessions via Zoom.

Alex is now 10 and has Infantile Neuroaxonal Dystrophy, which is a rare inherited disorder affecting the nerves in the brain, and elsewhere in the body, causing deterioration of many functions. Alex has epilepsy, central apnoea and relies on oxygen 24/7 for breathing and a gastrostomy (a tube straight into his stomach) for feeding.

Due to his health, Alex had a period where he wasn’t able to go to school. As part of our new ways of working, we were able to offer home, hospice and virtual support. This flexibility helped us to support Alex in the best way possible. We were able to provide community shifts in the home knowing family time was a priority for Lucie and Sean. This enabled them to have time together, knowing they had help to support Alex’s medical needs.

Alex and his family continue to be supported by Little Harbour and dad Sean is running the London Marathon to raise money for CHSW. At the time of writing this, the family are in for a resilience stay and we are getting the staff and children to make a banner for Sean to show our support while he is running the marathon.

Alex enjoys coming to Little Harbour for resilience stays with his family; he particularly enjoys the hydrotherapy pool. Faye enjoys spending time with the Sibling Team and making friends with other family’s children.

Good Luck Sean!

We also continued to offer resilience stays in-hospice, so the family could come in regularly for some rest and TLC. The family had regular visits which gave them something to look forward to, knowing they could have some wellearned rest and enjoy the facilities at Little Harbour with Alex and Faye.

In 2022, Alex had a deterioration in his health and discussions around end of life care were started and an advanced care plan was completed. Lucie and Sean spent time thinking about what they wanted for Alex

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George and his family have been visiting Little Bridge House since 2015

The family spent time together making memories. We supported Mum and she talked about George’s twin, who had sadly died at 3 days old, and we empowered her to include him too.

The Care Team tell George’s story.

George was referred in March 2015; he has Cerebral Palsy and Spastic Quadriplegia, he was born prematurely at 28 weeks and is the surviving twin of a twin-to-twin transfusion. He is now 17.

COVID-19 was ongoing so we had to consider infection control while keeping George and his family at the centre of our care. We were able to safely support visits from his wider family.

Initially, George and his family visited for regular resilience stays to get to know him and his family. George is nonverbal but quickly showed he could communicate his likes and wishes, and be very clear when he did not want to do something!

Despite being so unwell, George was able to express how he felt. We carefully communicated with him to allay his fears and empower him to make decisions. We noted a reduction in his anxiety levels; George, for the first time showed us who he was, his voice was heard. He is very funny, extremely cheeky and can tease staff without them realising. He is strong willed but sensitive, he enjoys the quiet but loves being sociable, being outside, listening to stories and pyjama days!

In July 2022 George was in hospital very unwell with concern he was at the end of his life. Mum was clear in her wish for George to be at Little Bridge House for his care. We began planning George’s transfer while sending members of our team to the hospital to support George and Mum. During this in-reach, one of our team was able to use her knowledge and skills to understand the cause of George’s distress. She was then able to support the hospital in their care.

George’s seizures continued to be medically managed us. Slowly we saw an improvement in his condition. After 9 days he was receiving symptom management rather than end of life care and his syringe driver was gradually withdrawn. We then spoke with the Community Team to explore options as he stabilised.

George was transferred to Little Bridge House for end of life care on the 28 July 2022 and we made him and Mum comfortable. After careful assessment, George was put on a syringe driver to optimise his comfort.

We participated in MultiDisciplinary Team

(MDT) meetings and made plans for George to return home. We trained Mum in the care and use of nasogastric tubes and made home visits to support her and assess his progress. He returned to us in September 2022 for an emergency resilience stay to further support Mum and allow her some needed rest. Unfortunately, Mum’s health deteriorated and she was admitted to hospital. This meant George went into hospital. A solution was needed to meet George’s care needs and we again helped with in-reach hospital visits and community visits to his placement. We also attended regular MDT meetings and supported them with feeding advice.

In November Mum remained in hospital and George in his placement but he continued to be fragile and have health complications. We offered them a Christmas stay so they could be together and make memories. Christmas is George’s favourite time of year and the snow machine in the garden was a highlight for him and the staff.

We have continued to

support George and Mum. The team is now looking to transition George into adult services as he begins his next chapter.

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Income generation

Thank you for making so much possible!

It has been a terrific year with thousands of people returning to events and activities across the South West; uniting in their efforts to support children, young people and families! It has been such a joy to meet so many new people while reconnecting with old friends as they all raise funds.

Our events calendar once again returned to full capacity and our Fundraising Teams have been busier than ever before, sharing stories, working with community groups and connecting with businesses from across the South West so that everyone could play their part. From Cream Teas and Christmas Tree collections to Rainbow Run and CHSW Business Club gatherings, we’ve been so grateful to have your support!

This year we planned to invest in growing the area of Individual Giving and we have seen a big increase in the number of people making donations; both one-off and regular gifts. The number of people playing our Raise a smile Lottery has grown by almost 3k and we have received a touching number of gifts in memory of loved ones. Once again in 2022 to 2023, we have seen a growing number of people making the most wonderful decision to leave a gift in their will, helping to secure care and support for years to come.

If you have donated, attended events, made purchases online or in our shops, or fundraised for CHSW in any way this year we want to say thank you on behalf

of every child, young person and family - together we have been there for them.

Here is where some of that money came from:

Almost 17k players in our Raise a smile Lottery helping to raise £836k £6.8m received from people who chose to remember CHSW with a gift in their will.

£5.2m raised in our 38 charity shops, turning pre-loved clothes and goods into precious memories.

£485k raised through CHSW events including our flagship fundraising cycle challenge, Ride for Precious Lives raising more than £250k!

Sustained growth across all our social media channels, with many supporters creating Facebook fundraisers, sharing stories of inspiration and fundraising successes in our Be Incredible group.

£914k from generous donations from Charitable Trusts and Foundations.

£3.3m raised from individuals making donations of all sizes, for so many beautiful reasons.

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A big SHOUT OUT to our fabulous volunteers!

The CHSW army of volunteers have been out in force from 2022 to 2023, welcoming thousands of people through our shop doors, running community events, speaking to local groups and organisations, tending to the hospice gardens, collecting donations and flying the flag for children, young people and families at every opportunity! Thank you just doesn’t seem enough to express our gratitude to all you do!

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Our financial performance

The consolidated financial statement comprises the result of the charity together with those of C H S W Promotions Limited, a wholly owned subsidiary, which donates its profits to the charity. The consolidated statement of financial activities is set out on page 22.

Donations and legacies amounted to £12,293,592 (2022:£10,282,604), income raised from charitable activities (statutory income sources) amounted to £2,325,395 (2022:£2,234,989), trading activities (including retail and Raise a smile Lottery) generated income of £6,122,948 (2022:£5,101,470), investment income was £712,423 (2022:£534,176) and other income £48,422 (2022: £155,857).

Total income for the year was £21,502,780 (2022:£18,309,096).

Total expenditure for the year amounted to £16,824,703 (2022:£14,882,416). This resulted in an operational surplus of £4,678,077 (2022:£3,426,680). Total net gains on investments, property and land was £118,375 (2022:gains £456,920) and therefore net income for the year was £4,796,452 (2022:£3,883,600).

Consolidated in the above figures C H S W Promotions Limited, a trading subsidiary, has a turnover which amounted to £353,396 (2022:£284,861) and a profit after taxation of £22,657 (2022:£11,497). The company will donate this amount to the charity.

During 2022 to 2023 our recovery from the financial impact of COVID-19 continued with income levels encouragingly increasing across the majority of our voluntary donation income streams. This continues as we move into the 2023 to 2024 financial year and are very thankful to our all supporters for their help in achieving this recovery and ongoing growth.

During the year, we were very grateful to receive a continued exceptionally high level of legacy donations. Legacy receipts are always a significant part of CHSW’s annual income but, by their very nature, can be difficult to predict and their level can vary significantly, both up and down, from 1 year to the next.

Where we received our income

----- Start of picture text -----
Legacies
Trading
Trusts
Voluntary
Statutory fundraising
income
Investment income
----- End of picture text -----

Legacies £6.9 million -32%

Trading - lottery and shops £6.1 million - 28%

Voluntary fundraising £4.5 million - 21%

Statutory income £2.4 million - 11%

Trusts £0.9 million - 5%

Investment income £0.7 million - 3% Total - £21.5 million

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Our legacy income in 2022 to 2023 amounted to £6,840,008 which is more than 32% of all our income and more than £1 million higher than 2021 to 2022. We are very encouraged by the continued growth seen from our legacy incomes which will help to support the long-term investment in our care development.

During the year all our shops have traded very strongly as they continue to benefit from fantastic local community support and the cost of living crisis together with the ever-increasing public interest in making sustainable purchases. Total shop income (including related Gift Aid receipts) achieved its highest levels ever at nearly £5.2 million as compared to £4.4 million in 2021 to 2022.

In 2023, agricultural land in Yatton was revalued upwards by £1.5 million to reflect the granting of planning permission to build residential homes on it. The valuation was established by an external surveyor and it is expected that a further upward increase will be required as the project progresses in 2023 to 2024. This gain helped to offset significant losses on our market investments held during the year, reflecting the global downturn of equities and bonds in the year.

During the year our expenditure in relation to our care of children, young people and families increased by more than 10% on the previous year. This reflects during the year the increased activity and support given at all 3 hospices following the easing of the COVID-19 restrictions with the charity being able to welcome

families back for resilience and end of life care.

It should be noted that the increase in income and net income (after expenditure) reported in 2022 to 2023 has been largely driven by the unprecedented level of legacy receipts and the strong performance of our retail shops.

We recognise the positive level of net income that has been generated during the year and are very grateful to all our supporters and donors who have helped us achieve this. We are very mindful that the impact of the cost-ofliving crisis and the corresponding pressure on wage inflation will be felt for a number of years. It is therefore anticipated that the surplus generated in 2022 to 2023 will be used to support the charity during the ongoing economic challenges and to ensure the continuance of its care delivery into the future.

Where we spent our income

----- Start of picture text -----
Charlton Farm
Trading
activities
Little Harbour
Raising funds
Little Bridge
House
Investment costs
----- End of picture text -----

Trading activities £4.9 million - 29%

Charlton Farm £3.6 million - 21%

Little Harbour £3.3 million - 20%

Little Bridge House £2.9 million - 17%

Raising funds £2 million - 12%

Investment costs £0.1 million - 1% Total - £16.8 million

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Trustees' report including the strategic report

Our financial reserves

and expenditure, while also considering already committed expenditure. From this work, looking forward, it has been determined that CHSW should maintain a target range of unrestricted general reserves of between £16,783,443 and £19,215,828 .

We recognise our commitment and moral obligation to the children, young people and families who currently use our hospices, will extend many years into the future. It is imperative, therefore, for us to maintain unrestricted general reserves at a level that will ensure the continuity of the unique care provided by the charity while recognising that the charity is facing a period of significant economic uncertainty.

The charity’s unrestricted general funds (free reserves) were at a level of £18,067,132 (note 19) as of 31 March 2023 (£18,116,361 as of 31 March 2022). We note that the group’s unrestricted general funds are within the target range set above.

In establishing the CHSW reserves policy, we have taken guidance from the Charity Commission’s guidance CC19, by using an integrated approach for an organisation with complex activities and structures. This involves projecting cash flows during the next 3 years and identifying key risks associated in this period, with both income

Designated funds are £26,394,329 (2022: £27,510,380) and represent the net book value of the unrestricted tangible and intangible fixed assets of the group in addition to £6,890,018

Our investment approach

The charity’s investment policy requires CHSW to invest funds in such a manner that the risk profile reflects planned expenditure and future plans.

included a review of investment performance and charges. As a result of this work, Aberdeen Standard Capital Limited and Sarasins & Partners LLP were appointed as CHSW investment managers going forward. As part of this restructuring of investment managers, CHSW investments were rebalanced and divided into a lower and higher equity exposure fund allocation. The minimum performance requirements of these invested funds have been set as Consumer Price Index (CPI) +3% for the lower equity exposed fund and CPI +4% for the higher equity exposed fund.

In 2019, we secured the services of an external independent investment advisor to undertake an investment risk profile review and to provide an ongoing expert assessment of the performance of our appointed investment managers. At the beginning of the 2020 to 2021 financial year, as part of good governance, a formal retendering process in relation to investment management services was undertaken, which

designated for the CHSW Care Endowment Fund (CCEF).

On 14 July 2022, the CCEF was formally and legally set up to provide an additional income stream from long-term investments to support future care developments and reduce future dependence on fundraising and trading activity. The need for this fund has been highlighted during the COVID-19 crisis where voluntary and trading incomes have been found to be vulnerable. The CCEF is expendable and will also be used to finance care, operational and developmental opportunities in the future if unrestricted general reserves fall below their required lower target level. On the 31 March 2023 the CCEF amounted to £3,987,446 . During the year £2,917,703 was designated for transfer to the CCEF in the 2023 to 2024 year.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Trustees' report including the strategic report

How we manage risks and uncertainties

CHSW has a clear Risk

Management Framework in place, overseen by the Trustee Governance Assurance Committee as delegated by the Board of Trustees. CHSW undertake a continual assessment of the principal risks facing the charity and are satisfied that adequate preventative and mitigating measures are in place to reduce the risks to an acceptable level. All risks identified are recorded on the CHSW Risk Register and scored based on impact and likelihood in line with the Charity Commission’s guidance CC26, based on the scores, the risks are prioritised using a Red, Amber or Green rating.

The CHSW agreed process for reviewing risk, is as follows:

SMT will meet weekly to monitor and review current risks; and share, record and escalate any new or emerging risks as appropriate

SMT will meet as the Risk Management Committee every quarter where the risk register is reviewed and updated. Identified risks may be added to the register at any time

Each item on the risk register is owned and overseen by the relevant Assurance Committee as a standing item at each of their meetings (currently 3 times per year)

The Governance Assurance Committee will take assurance from the Chairs of each Committee that their relevant risks have been reviewed and mitigated to satisfactory levels

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Trustees' report including the strategic report

Current red risks

Recruitment: The inability to recruit and retain children’s nurses as reflected in the national picture remains an ongoing and challenging red risk for CHSW. A nurse recruitment and retention options appraisal was commissioned by the Trustees in June 2022 which reviewed a number of different approaches to address this risk. A package of options was chosen and implemented from 1 January 2023, alongside an intensive recruitment and marketing campaign. The impact has been an uplift in nurse appointments at all 3 hospices in the first 3 months of 2023 and this work continues into

2023 to 2024 with monitoring and evaluation in place.

Safeguarding issues arising: Safeguarding is a top priority at CHSW with stringent policies, procedures and mandatory training in place for all staff up to Safeguarding Level 5. We continue to be vigilant and diligent; audit our policies and practices carefully; and embed our values and behaviours to reflect our ethos and duty of care.

Failure of cyber security: Reflecting the ongoing global rise in criminal activity around data security this remains a red risk. In June 2022, CHSW successfully

completed the NHS Data Security Toolkit. Also, in June 2022 a full external and internal cyber security audit and penetration test was carried out. The audit made several recommendations for increased security of our website and our internal servers which are currently being implemented and actioned. CHSW IT regularly make staff aware of new and trending security risks as threats develop. Currently, CHSW IT and SMT are considering the potential implementation of a security operations centre (an external service that would be bought into CHSW).

Included on page 48 to 51 are the charities structure, governance and management, reference and administrative detail and fundraising disclosures which also form part of this report.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Trustees' report including the strategic report

Statement of Trustees’ responsibilities

The Trustees (who are also Directors of CHSW for the purposes of company law) are responsible for preparing the Trustees’ Annual Report (including the Strategic Report) and the financial statements, in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards).

Company law requires the Trustees to prepare financial statements for each financial year. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the charitable group for that period. In preparing these financial statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions, disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006 and the provisions of the charity’s constitution. They are also responsible for safeguarding the assets of the charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Disclosure of information to Auditors

Insofar as each of the Trustees of the charity at the date of approval of this report is aware, there is no relevant audit information (information needed by the charity’s auditor in connection with preparing the audit report) of which the charity’s auditor is unaware. Each Trustee has taken all of the steps that he/she should have taken as a Trustee in order to make himself/herself aware of any relevant audit information and to establish that the charity’s auditor is aware of that information.

Approval

This report, incorporating the strategic report, was approved by the Board of Trustees on 12 October 2023 and signed on its behalf:

Tricia Morris Chair of Trustees

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

Consolidated statement of financial activities

Including income and expenditure account for the year ended 31 March 2023

Notes Unrestricted
fund
£		 Restricted
funds
£		 Bayliss
Endowment
Fund
£		 Care
Endowment
Fund
£		 Total 2023
funds
£		 Total 2022
funds
£
Income from
Donatons and legacies 1 9,997,816 2,295,776 - - 12,293,592 10,282,604
Charitable actvites:
statutory funding		 4 977,346 1,348,049 - - 2,325,395 2,234,989
Trading actvites 3 6,122,948 - - - 6,122,948 5,101,470
Investments 2 656,256 56,167 - - 712,423 534,176
Other 40,422 8,000 - - 48,422 155,857
Total income 5 17,794,788 3,707,992 - - 21,502,780 18,309,096
Expenditure on
Trading actvites 3 4,928,079 - - - 4,928,079 3,948,812
Total income net of
trading expenditure		 12,866,709 3,707,992 - - 16,574,701 14,360,284
Expenditure on
Raising funds 2,034,869 - - - 2,034,869 1,969,748
Investment
management fees		 107,385 - - - 107,385 100,374
Net income available
for charitable actvites		 10,724,455 3,707,992 - - **14,432,447 ** 12,290,162
Charitable actvites
Care of children, young
people and families		 6 6,593,562 3,160,807 - - 9,754,369 8,863,482
Total expenditure 6 13,663,895 3,160,807 - **- ** 16,824,702 14,882,416
Net income before
gains on investments		 10 4,130,893 547,185 - 4,678,078 3,426,680
Net gain on
property and land		 13a, 13b 45,900 1,514,000 - - 1,559,900 -
Net (loss)/gain on
investments		 13b (1,328,741) (100,230) (12,554) (1,441,525) 456,920
Net income **2,848,052 ** 2,061,185 (100,230) (12,554) 4,796,453 3,883,600
Transfer between funds 17, 18, 19 (4,013,332) 8,532 4,800 4,000,000 - -
Net movement in funds (1,165,280) 2,069,717 (95,430) 3,987,446 4,796,453 3,883,600
Reconciliaton of funds
Total funds
brought forward		 17, 18, 19 45,626,741 609,526 1,643,228 - 47,879,495 43,995,895
Total funds
carried forward		 17, 18, 19 44,461,461 2,679,243 1,547,798 3,987,446 52,675,948 47,879,495

The statement of financial activities includes all gains and losses recognised in the year, all income and expenditure derive from continuing activities of the group. Accounting policies on pages 41 to 44 and notes to the accounts on page 25 to 40 form part of these statements.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

Consolidated and charity balance sheet

Company number: 02620879

As at 31 March 2023

Notes Group 2023
£		 Group 2022
£		 Charity 2023
£		 Charity 2022
£
Fixed assets
Tangible assets 11 19,835,946 19,891,294 19,835,946 19,891,294
Intangible assets 12 48,363 26,770 48,363 26,770
Investments 13a 24,631,547 20,577,682 24,631,647 20,577,782
Total 44,515,856 40,495,746 44,515,956 40,495,846
Current assets
Stock 14 62,502 25,592 - -
Debtors 15 2,216,710 4,717,581 2,255,126 4,745,497
Investments 13c - 454,944 - 454,944
Cash at bank and in hand 9,466,376 5,606,929 9,462,977 5,589,340
Total 11,745,588 10,805,046 11,718,103 10,789,781
Creditors falling due within 1 year 16a (1,919,330) (1,998,638) (1,914,602) (1,995,173)
Net current assets 9,826,258 8,806,408 9,803,501 8,794,608
Creditors falling due afer 1 year 16b (1,666,166) (1,422,659) (1,666,166) (1,422,659)
Total net assets 52,675,948 47,879,495 52,653,291 47,867,795
Funds of the group and charity
Endowment funds 17 5,535,244 1,643,228 5,535,244 1,643,228
Restricted funds 18 2,679,243 609,526 2,679,243 609,526
Unrestricted designated funds 19 26,394,329 27,510,380 26,394,329 27,510,380
Unrestricted general fund 19 18,067,132 18,116,361 18,044,475 18,104,661
Total group and charity funds 20 52,675,948 47,879,495 52,653,291 47,867,795

Of the net movement in funds for the year of £4,796,453 (2022:£3,883,600), an amount of £4,785,493 (2022:£3,697,549) has been dealt with in the Statement of Financial Activities of the parent company.

The financial statements were approved and authorised for issue by the Board of Trustees on 12 October 2023 and signed on its behalf:

Tricia Morris Chair of Trustees

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

Consolidated cash flow statement

For the year ended 31 March 2023

----- Start of picture text -----
2023 2022
Notes
£ £
Cash provided by operating activities 28a 7,650,694 4,168,663
Cash flows from investing activities
Deposit interest received 85,170 1,464
Investment income received 574,841 429,607
Rental income received 7,126 2,744
Cash flows from investing activities 667,137 433,815
Capital expenditure and financial investment
Purchases of tangible and intangible fixed assets (963,228) (379,216)
Purchases of tangible and intangible fixed assets (963,228) (379,216)
Proceeds from sales of tangible fixed assets 4,000 1,200
Fixed asset investments
Payments (4,000,000) (5,100,000)
-
Receipts 500,844
Fixed asset investments (3,499,156) (5,100,000)
Capital expenditure and financial investment (4,458,384) (5,478,016)
Net cash provided (used in) investing activities (3,791,247) (5,044,201)
Change in cash and cash equivalents in the reporting period 28b 3,859,447 (875,538)
Cash and cash equivalent at the beginning of the year 5,606,929 6,482,467
Total cash and cash equivalent at the end of the year 9,466,376 5,606,929
----- End of picture text -----

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

Notes to the financial statements

For the year ended 31 March 2023

1 Donations and legacies

----- Start of picture text -----
Total 2023 Total 2022
£ £
Individuals 3,345,525 2,269,734
Friends Group fundraising 177,791 154,755
Legacies 6,840,008 5,570,894
Grants and donations from Charitable Trusts 913,820 844,423
Government Grant - NHS England COVID-19 funding 15,139 260,025
Other voluntary income 1,001,309 1,182,773
Total 12,293,592 10,282,604
----- End of picture text -----**

**The NHS England awarded funding to allow the hospice to make available bed capacity and community support from April 2020 to March 2022 to provide support to people with complex needs in the context of COVID-19.

2 Investment income

Total 2023
£		 Total 2022
£
UK 192,971 209,093
Overseas 79,161 48,947
Mult-asset funds 348,515 265,650
Income from cash deposits 85,170 1,456
Rental income 6,606 9,030
712,423 534,176

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Financial statements

----- Start of picture text -----
3 Income and expenditure of trading activities
Total 2023 Total 2022
Trading income
£ £
C H S W Promotions Limited 353,396 284,861
Lottery and raffles 895,727 772,211
Donations relating to the sale of goods where the shops acted as agent 1,459,259 1,178,330
Gift Aid received on donations where the shops acted as agent 350,710 292,476
Shops turnover 3,063,856 2,573,592
Total 6,122,948 5,101,470
Trading expenditure
C H S W Promotions Limited 330,739 273,364
Lottery and raffles 428,989 350,567
Shops (all associated costs including depreciation) 3,839,959 3,398,220
Dilapidations provision 328,392 (73,339)
Total 4,928,079 3,948,812
----- End of picture text -----

The principal activity of the charity’s wholly owned subsidiary, C H S W Promotions Limited (company number 02645823) is the sale of bought-in goods, including Christmas cards, through the charity shops of the parent charity and through its network of Friends Groups and by mail order.

The income and expenditure of C H S W Promotions Limited are disclosed as ‘trading’ income and expenditure in the Consolidated Statement of Financial Activities on page 22.

C H S W Promotons Limited Total 2023
£		 Total 2022
£
Turnover 353,396 284,861
Total expenditure (330,739) (273,364)
Operatng proft and proft before tax 22,657 11,497
Taxaton - -
Proft afer taxaton 22,657 11,497
Retained earnings at the beginning of the year 11,697 15,725
Distributon of retained earnings as Gif Aid donaton to parent (11,497) (15,525)
Retained earnings at the end of the year 22,857 11,697
Assets 66,136 43,268
Liabilites (43,179) (31,471)
Net assets 22,957 11,797

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

4 Income from charitable activities

Total 2023
£		 Total 2022
£
Funding from regional Integrated Care Boards (ICBs),
previously Clinical Commissioning Groups (CCGs)		 1,147,401 996,013
NHS England Children's Hospice grant 1,144,194 1,205,176
NHS England Superannuaton grant 33,800 33,800
Total income from charitable actvites 2,325,395 2,234,989

CHSW acknowledges the award of grants for Little Bridge House, Charlton Farm and Little Harbour from the NHS England Children’s Hospice grant. The project undertakes to sustain and develop existing high quality hospice care for children and young people receiving palliative care, their siblings and parents. It promotes education and learning needs of all those working in the sector in a responsive and flexible way. The funding and associated expenditure have been treated as movements in restricted funds.

In 2010 the charity succeeded in establishing contractual arrangements with the 6 CCGs whose areas the charity covers. These arrangements were constructed at the behest of government. A price per bed night has been agreed and it has also been agreed the volume of bed nights each CCG will purchase. There are no unfulfilled conditions in respect of these contractual arrangements.

5 Government grants

Included within donations and legacies and other income were government grants recognised in the year ended 31 March 2023

Total 2023
£		 Total 2022
£
Retail, Hospitality and Leisure Grant Fund - 141,633
NHS England COVID-19 Funding** 15,139 260,025
Total 15,139 401,658

**The NHS England awarded funding to allow the hospice to make available bed capacity and community support from April 2020 to July 2020 to provide support to people with complex needs in the context of the COVID-19 situation and to provide bed capacity and community support from November 2020 to March 2022 for the same purpose.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

6 Total expenditure

----- Start of picture text -----
Staff costs Direct costs Support costs Total 2023 Total 2022
£ £ £ £ £
note 8 note 7
Costs of raising funds 3,833,444 3,236,889 - 7,070,333 6,018,934
Care of children, young
7,527,988 1,545,784 680,597 9,754,369 8,863,482
people and families
Total 11,361,432 4,782,673 680,597 16,824,702 14,882,416
----- End of picture text -----

Governance costs of £39,747 are included within support costs and comprise the costs of running the charity. This includes insurance £1,860, external audit £17,147, internal audit £3,004, consultancy fees and legal advice for the Trustees £17,591 and all costs of complying with constitutional and statutory requirements such as the costs of Board and Committee meetings £145.

7 Support costs

Support costs reallocated to the expenditure category of care Total 2023
£		 Total 2022
£
Communicatons and IT 562,963 490,498
Human Resources 383,812 346,165
Governance 39,747 44,936
Finance 421,425 359,931
Head Ofce Support 425,129 392,029
Retail grant provision (84,884) (84,884)
Total support costs 1,748,192 1,548,675
Less: staf costs (1,067,595) (973,927)
Total 680,597 574,748

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Financial statements

----- Start of picture text -----
8 Employee information
Staff costs Total 2023 Total 2022
£ £
Salaries and wages 9,635,610 8,428,342
Social security costs 884,048 716,412
Pension costs 841,774 803,515
Total 11,361,432 9,948,269
FTE Total FTE Total
Average number of persons employed
2023 2023 2022 2022
Hospice services 144 178 132 168
Fundraising and publicity 47 54 42 52
Trading 74 113 71 110
Management and Finance 22 27 20 24
Total 287 372 265 354
----- End of picture text -----

7 employees earned between £60,000 and £70,000 per annum in the year (2022:5). 2 employees earned between £70,000 and £80,000 per annum in the year (2022:3). 4 employees earned between £80,000 and £90,000 per annum in the year (2022:2). 0 employees earned between £90,000 and £100,000 per annum in the year (2022:1). 0 employees earned between £100,000 and £110,000 per annum in the year (2022:1). 2 employees earned between £110,000 and £120,000 per annum in the year (2022:nil).

Retirement benefits are accruing under a defined benefit scheme for 7 (2022:4) of these higher paid employees. In addition, the charity paid £55,268 (2022:£54,926) into a defined contribution pension scheme for 8 (2022:8) of these higher paid employees. Salaries and wages include contributions in respect of salary exchange agreements in addition to contractual salary.

Following advice from the Government Actuary’s Department as part of the 2016 scheme valuation process, the Department of Health and Social Care (DHSC) confirmed the NHS employer contribution rate will increase to 20.68% with effect from 1 April 2019. The government has committed to cover this cost increase for a certain category of employers, including CHSW, recurring annually until 31 March 2023.

All Trustees and certain senior employees who have authority and responsibility for planning, directing and controlling the activities of the charity are considered to be key management personnel. Total employment costs (including social security and pension contributions) in respect of senior employees is £626,969 (2022:£591,213). As stated in note 9, there is no cost of employment in respect of the Trustees.

During the year, redundancy and settlement payments were made totalling £15,216 (2022:£10,278). At 31 March 2023 the payments outstanding were nil (2022:£nil).

*Full time equivalent.

9 Trustees remuneration and related party transactions

None of the Directors or Trustees received emoluments or benefits in kind during the year in respect of their duties as a Director or Trustee (2022:nil). During the year 2 Trustees claimed expenses totalling £195 (2022:nil) for travel and subsistence.

During the year the charity recharged expenses of £182,687 (2022:£159,523) to C H S W Promotions Limited and remittances were £172,242 (2022:£151,080). The amount due from C H S W Promotions at the year end was £38,451 (2022:£28,006) which is included in debtors. Included within this debtor is management recharges of £180,311 (2022:£158,172).

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

10 Net income for the year

The net income is stated after charging

Total 2023
£		 Total 2022
£
Depreciaton and amortsaton of owned tangible and intangible fxed assets 987,233 1,056,422
Loss/(proft) on disposal of fxed assets 5,750 (1,200)
Operatng lease rentals 898,235 858,501
Auditor's remuneraton - audit fees 17,147 17,219
Auditor’s remuneraton - other fees 7,007 4,561

11 Tangible fixed assets

----- Start of picture text -----
Freehold Office Fittings
Leasehold Motor
property furniture and and other Total
property vehicles
and land equipment equipment £
£ £
£ £ £
Cost
At 1 April 2022 21,697,829 506,152 283,246 1,270,527 3,307,431 27,065,185
Additions 226,173 47,132 36,572 159,042 454,976 923,895
Disposals - (1,334) (30,000) (52,741) (38,951) (123,026)
At 31 March 2023 21,924,002 551,950 289,818 1,376,828 3,723,456 27,866,054
Depreciation
At 1 April 2022 3,088,355 367,451 264,643 955,970 2,497,472 7,173,891
Charged in the year 465,095 64,389 10,820 143,926 285,263 969,493
Disposals - (1,067) (30,000) (51,782) (30,427) (113,276)
At 31 March 2023 3,553,450 430,773 245,463 1,048,114 2,752,308 8,030,108
Net book value
At 31 March 2022 18,609,474 138,701 18,603 314,557 809,959 19,891,294
At 31 March 2023 18,370,552 121,177 44,355 328,714 971,148 19,835,946
----- End of picture text -----

All of the assets above are used on a continuing basis in pursuit of the charity’s activities.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 30

Financial statements

11a Freehold land and properties

----- Start of picture text -----
Little Bridge House Charlton Farm Little Harbour Total
£ £ £ £
Cost
At 1 April 2022 3,480,452 12,502,071 5,715,306 21,697,829
Additions - 226,173 - 226,173
At 31 March 2023 3,480,452 12,728,244 5,715,306 21,924,002
Depreciation
At 1 April 2022 1,235,402 1,340,695 512,258 3,088,355
Charged in the year 101,253 269,482 94,360 465,095
At 31 March 2023 1,336,655 1,610,177 606,618 3,553,450
Net book value
At 31 March 2022 2,245,050 11,161,376 5,203,048 18,609,474
At 31 March 2023 2,143,797 11,118,067 5,108,688 18,370,552
----- End of picture text -----

Included in the above is land totalling £2,947,681 which is not depreciated.

12 Intangible fxed assets 12 Intangible fxed assets
Computer sofware
£
Cost
At 1 April 2022 745,278
Additons 39,333
Disposals (285,814)
At 31 March 2023 498,797
Depreciaton
At 1 April 2022 718,508
Charged in the year 17,740
Disposals (285,814)
At 31 March 2023 450,434
Net book value
At 31 March 2022 26,770
At 31 March 2023 48,363

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 31

Financial statements

13a Investments

Group 2023
£		 Group 2022
£		 Charity 2023
£		 Charity 2022
£
Listed investments
UK equites and bonds at cost 4,584,596 3,798,240 4,584,596 3,798,240
Overseas equites and bonds at cost 3,550,248 3,471,399 3,550,248 3,471,399
Mult-fund assets at cost 10,622,949 9,691,774 10,622,949 9,691,774
Other assets at cost 1,738,358 1,665,667 1,738,358 1,665,667
Cumulatve net gains on revaluaton at period end 356,420 1,472,384 356,420 1,472,384
Market value at period end (note 13b) 20,852,571 20,099,464 20,852,571 20,099,464
Cash held as part of investment portolios 2,178,976 392,218 2,178,976 392,218
23,031,547 20,491,682 23,031,547 20,491,682
Other investments
Donated land held for investment purposes 1,600,000 86,000 1,600,000 86,000
Investment in C H S W Promotons Limited - - - -
Shares at cost - - 100 100
Total 24,631,547 20,577,682 24,631,647 20,577,782

The charity’s investment portfolio was managed by Aberdeen Standard and Sarasin & Partners. Investments are held in a diverse portfolio of funds, managed by Aberdeen Standard, Sarasin & Partners and other fund managers, and in Government stocks. The only holdings in excess of 5% of total investments were Sarasin Endowments Fund (50%).

The £1,514,000 increase in the value of donated land held for investment purposes recognises the increase in market value of agricultural land at Yatton following the approval of planning permission on this site.

C H S W Promotions Limited is a wholly owned subsidiary which is registered in England and Wales and whose principal activity is the sale of bought-in goods for the benefit of CHSW. The shares are Ordinary Shares of £1 each and are shown at cost. The company pays its taxable profits to the charity under Gift Aid.

13b Listed investments market value 13b Listed investments market value 13b Listed investments market value
Listed investments 2023
£		 2022
£
Market value at 1 April 20,099,464 14,775,537
Additons at cost 3,718,728 5,929,971
Sales proceeds (1,523,119) (1,062,964)
Equalisatons (977) -
Net (loss)/gains (1,441,525) 456,920
At 31 March 20,852,571 20,099,464

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

----- Start of picture text -----
13c Current asset investment
----- End of picture text -----
2023
£		 2022
£
Investment in Hope Cove - 454,944

During the year the investment in Hope Cove was sold realising a gain of £45,900

----- Start of picture text -----
14 Stock
Group 2023 Group 2022 Charity 2023 Charity 2022
£ £ £ £
Stock for resale 62,502 25,592 - -
15 Debtors
Group 2023 Group 2022 Charity 2023 Charity 2022
£ £ £ £
Amounts owed by group undertakings - - 38,451 28,006
Legacies receivable 750,576 3,522,804 750,576 3,522,804
Other debtors including tax recoverable 870,763 479,266 870,763 479,176
Prepayment and accrued interest 595,371 715,511 595,336 715,511
2,216,710 4,717,581 2,255,126 4,745,497
----- End of picture text -----

16a Creditors less than 1 year

Group 2023
£		 Group 2022
£		 Charity 2023
£		 Charity 2022
£
Trade creditors 351,928 146,710 351,861 146,684
Taxaton and social security 219,582 174,979 219,582 174,979
Sundry creditors 207,146 188,552 207,146 188,552
Accruals and deferred income 1,140,674 1,488,397 1,136,013 1,484,958
1,919,330 1,998,638 1,914,602 1,995,173
Deferred income of£504,449arose in the year and £669,719 brought forward from 2022 was released.
Deferred income includes income relatng to registratons and sponsorship for upcoming events
£146,492(2022:£138,813), lotery subscriptons for future draws£84,835(2022:£98,154).
16b Creditors more than 1 year
Group 2023
£		 Group 2022
£		 Charity 2023
£		 Charity 2022
£
Dilapidatons provisions 1,581,282 1,252,890 1,581,282 1,252,890
Retail grant provisions 84,884 169,769 84,884 169,769
1,666,166 1,422,659 1,666,166 1,422,659

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

17 Endowment funds

17 Endowment funds
1 April
2022
£		 Income
£		 Expenditure
£		 Losses
£		 Transfer
between
funds
£		 31 March
2023
£
CCEF - - - (12,554) 4,000,000 3,987,446
Bayliss Endowment Fund 1,643,228 - - (100,230) 4,800 1,547,798
1,643,228 (112,784) 4,004,800 5,535,244
1 April
2021
£		 Income
£		 Expenditure
£		 Gains
£		 Transfer
between
funds
£		 31 March
2022
£
Bayliss Endowment Fund 1,605,712 - - 37,516 - 1,643,228

During 2007, the charity received an expendable endowment of £1 million, the income from which is restricted. This income funds care staff costs at Charlton Farm and, in particular, the post of Head of Care. Income in 2023 is £56,167 (2022:£59,098) and is included in restricted funds income on the Statement of Financial Activities. The gain in 2023 is (£100,230) (2022:£37,516).

During 2022, the charity established the CHSW Care Endowment Fund (CCEF) to ensure the long-term financial sustainability, stability and resilience of the charity and the long-term continuation of the delivery of care services and to ensure that future care expenditure and investment can be financed even during periods of lower anticipated income. The formation of the CCEF has been established following expert legal advice taken by the CHSW Trustee Board on the form, nature and compliance with regulatory law and guidance of the fund. On 30 March 2023 an initial transfer of £4,000,000 was made to the CCEF.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

18 Restricted funds

----- Start of picture text -----
Transfer
1 April 31 March
Income Expenditure Gains between
2022 2023
£ £ £ funds
£ £
£
Little Harbour capital 380,000 - - - - 380,000
380,000 - - - - 380,000
NHS England grants - 1,363,188 (1,363,188) - - -
-
Little Bridge House funds 59,187 395,520 (318,168) (12,656) 123,883
Charlton Farm funds 79,389 818,455 (371,892) 1,514,000 (25,143) 2,014,809
-
Little Harbour funds 38,449 941,299 (931,915) (18,576) 29,257
CHSW funds 52,501 189,530 (175,644) - 64,907 131,294
609,526 3,707,992 (3,160,807) 1,514,000 8,532 2,679,243
----- End of picture text -----

1 April
2021
£		 Income
£		 Expenditure
£		 Gains
£		 Transfer
between
funds
£		 31 March
2022
£
Litle Harbour capital 380,000 - - - - 380,000
380,000 - - - - 380,000
NHS England grants - 1,499,001 (1,499,001) - - -
Litle Bridge House funds 55,002 153,080 (144,415) - (4,480) 59,187
Charlton Farm funds 75,509 624,688 (619,124) - (1,684) 79,389
Litle Harbour funds 47,845 1,719,819 (1,700,339) - (28,876) 38,449
CHSW funds 43,194 72,448 (44,586) - (18,555) 52,501
601,550 4,069,036 (4,007,465) - (53,595) 609,526

The NHS England grant is the NHS England ‘Children’s Hospice grant’ which was given to sustain and develop the existing high quality hospice care for children and young people receiving palliative care, their siblings and parents.

During the year, agricultural land being held by the charity was revalued with a gain of £1,514,000 following the granting of planning permission to build residential homes on it. As the land had originally been donated by a supporter of care at Charlton Farm, the recognition of this valuation has been restricted to this hospice.

The Little Bridge House, Charlton Farm, Little Harbour and CHSW funds include donations towards specific projects at each hospice and across the whole charity, including Music Therapy, equipment, rooms and gardens, parties and presents, play equipment and materials, salary and other revenue costs, and funding of mums and dads groups.

Other legacies and donations are restricted to be spent at a specific hospice. 7 restricted legacies were more than £50,000, of which a total of £234,366 was donated for Charlton Farm and £465,122 was donated for Little Harbour.

Transfers between funds represent the amounts spent on capital assets from revenue funds. Only assets with a continuing restriction are maintained as restricted funds.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

19 Unrestricted funds 19 Unrestricted funds 19 Unrestricted funds 19 Unrestricted funds 19 Unrestricted funds 19 Unrestricted funds 19 Unrestricted funds
2022 to 2023 group 1 April
2022
£		 Income
£		 Expenditure
/Transfer
£		 Investment
losses
£		 Transfer
between
funds
£		 31 March
2023
£
Designated capital funds 19,538,065 - (987,232) - 953,479 19,504,312
Designated care income fund 7,972,315 - (4,000,000) - 2,917,702 6,890,017
Total designated funds 27,510,380 - (4,987,232) - 3,871,181 26,394,329
Unrestricted general funds 18,116,361 17,794,788 (12,676,663) (1,282,841) (3,884,513) 18,067,132
Total unrestricted funds 45,626,741 17,794,788 (17,663,895) (1,282,841) (13,332) 44,461,461
2022 to 2023 charity 1 April
2022
£		 Income
£		 Expenditure
/Transfer
£		 Investment
losses
£		 Transfer
between
funds
£		 31 March
2023
£
Designated capital funds 19,538,065 - (987,232) - 953,479 19,504,312
Designated care income fund 7,972,315 - (4,000,000) - 2,917,702 6,890,017
Total designated funds 27,510,380 - (4,987,232) - 3,871,181 26,394,329
Unrestricted general funds 18,104,661 17,453,092 (12,345,924) (1,282,841) (3,884,513) 18,044,475
Total unrestricted funds 45,615,041 17,453,092 (17,333,156) (1,282,841) (13,332) 44,438,804
2021 to 2022 group 1 April
2021
£		 Income
£		 Expenditure
/Transfer
£		 Investment
gains
£		 Transfer
between
funds
£		 31 March
2022
£
Designated capital funds 20,215,272 - (1,056,420) - 379,213 19,538,065
Designated care income fund 6,925,613 - - - 1,046,702 7,972,315
Total designated funds 27,140,885 - (1,056,420) - 1,425,915 27,510,380
Unrestricted general funds 14,647,748 14,240,060 (9,818,531) 419,404 (1,372,320) 18,116,361
Total unrestricted funds 41,788,633 14,240,060 (10,874,951) 419,404 53,595 45,626,741
2021 to 2022 charity 1 April
2021
£		 Income
£		 Expenditure
/Transfer
£		 Investment
gains
£		 Transfer
between
funds
£		 31 March
2022
£
Designated capital funds 20,215,272 - (1,056,420) - 379,213 19,538,065
Designated care income fund 6,925,613 - - - 1,046,702 7,972,315
Total designated funds 27,140,885 - (1,056,420) - 1,425,915 27,510,380
Unrestricted general funds 14,632,023 14,128,897 (9,703,343) 419,404 (1,372,320) 18,104,661
Total unrestricted funds 41,772,908 14,128,897 (10,759,763) 419,404 53,595 45,615,041

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

The Trustees have established designated capital funds which are equivalent to the net book value of unrestricted tangible and intangible fixed assets used to enable CHSW to carry out its charitable work. Of the net transfers between funds, £72,419 represent the amounts spent on capital assets from restricted funds where the restrictions on the donations for assets have been fulfilled. In the year £890,809 was spent on capital from general unrestricted funds and was transferred to designated capital funds.

Unrestricted general funds have the primary aim of reducing the dependency of the charity on any of its income streams as they develop in the future and to specifically fund essential projects to improve the service of the organisation.

20 Analysis of fund balances between net assets

As at 31 March 2023 Unrestricted
funds
£		 Restricted
funds
£		 Endowment
funds
£		 Total
£
Fixed assets 19,504,309 380,000 - 19,884,309
Investments 19,096,303 - 5,535,244 24,631,547
Net current assets 7,527,015 2,299,243 - 9,826,258
Non current liabilites (1,666,166) - - (1,666,166)
44,461,461 2,679,243 5,535,244 52,675,948
As at 31 March 2022
Fixed assets 19,538,064 380,000 - 19,918,064
Investments 18,934,454 - 1,643,228 20,577,682
Net current assets 8,576,882 229,526 - 8,806,408
Non current liabilites (1,422,659) - - (1,422,659)
45,626,741 609,526 1,643,228 47,879,495
Free reserves Group 2023
£		 Group 2022
£		 Charity 2023
£		 Charity 2022
£
Unrestricted general funds 18,067,132 18,116,361 18,044,475 18,104,661
18,067,132 18,116,361 18,044,475 18,104,661
Free reserves target (ceiling) 14,878,581 13,411,160 14,878,581 13,411,160
Free reserves target (foor) 12,717,978 11,670,998 12,717,978 11,670,998

21 Status of the charitable company

The charity is a company limited by guarantee, having no share capital. The liability of each member, in the event of winding-up, is limited to £1.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 37

Financial statements

22 Operating lease commitments

The total commitment under operating leases for premises is as follows

Payments falling due 2023
£		 2022
£
Within 1 year 633,401 749,653
Between 2 and 5 years 830,283 1,053,553
In more than 5 years 63,262 80,262

The total commitment under operating leases for other assets is as follows

Payments falling due 2023
£		 2022
£
Within 1 year 38,918 27,788
Between 2 and 5 years 82,826 84,913
In more than 5 years - 1,518

23 Pension commitments

CHSW employees belonged to 2 principal pension schemes during the year. The NHS pension scheme for eligible staff is a defined benefit scheme. Non-eligible members of staff are offered a defined contribution scheme administered by Scottish Widows.

NHS scheme

Only ex-NHS qualified doctors and nurses are eligible to join the NHS scheme. The NHS scheme is a multi-employer defined benefit pension scheme. As the charity is unable to identify its share of the assets and liabilities of the scheme on a consistent and reliable basis, the scheme is treated by the charity as if it were a defined contribution scheme, in accordance with Financial Reporting Standard (FRS 102) applicable in the UK and Republic of Ireland ‘Retirement benefits’.

Total pension contributions and liabilities

The total pension costs, excluding salary exchange, charged in the year represent the charity’s contributions to all the schemes and amounted to £841,774 (2022:£803,515). The charity’s contributions outstanding at 31 March 2023 were £128,673 (2022:£113,568). The assets and liabilities of both schemes are held separately from those of the charity, in independently administered pension schemes.

24 Capital commitments

At the balance sheet date the Charity had capital commitments totalling £nil (2022:£nil).

25 Indemnities

Legacies

The charity has indemnified the executors of 3 estates in respect of residuary legacies distributed to the charity. The maximum liability under the indemnities at the date the accounts were approved is £27,437 (2022:£27,437).

Solicitors’ unclaimed client funds

Following the passing of relevant legislation, solicitors are now permitted to distribute to charities certain unclaimed client funds, however an indemnity is required from those charities to indefinitely commit to refund any funds that are subsequently claimed. The total of the charity’s indemnities is £104,919 (2022:£104,919).

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 38

Financial statements

26 Legacies receivable

As at 31 March 2023, the charity had been notified of a number of residuary legacies, the values of which were uncertain, as the executors were awaiting confirmation of other claims on the estate and may also be in the process of realising assets such as residential property. The estimated total of these legacies could be up to £2.8 million .

None of these legacies have been accrued in the financial statements.

27 Post balance sheet event

There have been no post balance sheet events that require reporting.

28a Note to the cash flow statement

Reconciliation of net movement in funds to the net cash flow from operating activities

Total 2023
£		 Total 2022
£
Net movement in funds 4,796,452 3,883,600
Add back: depreciaton and amortsaton charges 987,233 1,056,422
Add back: losses/(gains) on investments 1,441,525 (456,920)
Add back: (gains) on property and land (1,559,900) -
Deduct: Investment income and deposit interest (605,036) (433,801)
Loss/(proft) on disposal of fxed assets 5,750 (1,200)
Decrease/(increase) in stocks (36,910) (3,746)
Decrease/(increase) in debtors 2,451,922 (585,709)
Increase/(decrease) in creditors (73,850) 874,564
Increase/(decrease) in provisions 243,508 (161,944)
(Increase) in hope cove investment - (2,603)
Net cash provided by operatng actvites 7,650,694 4,168,663

28b Note to the cash flow statement

Analysis of changes in net cash resources

Total 2023
£		 Cash fow
£		 Total 2022
£
Cash at bank and in hand 9,466,376 3,859,447 5,606,929

I just wanted to say a big thank you for all the things you did during our stay at Charlton Farm. The love and care we all felt from each and everyone of you was so much appreciated and we will never forget all the lovely little touches that made our stay so special.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Financial statements

29 Prior year statement of fnancial actvites 29 Prior year statement of fnancial actvites 29 Prior year statement of fnancial actvites 29 Prior year statement of fnancial actvites 29 Prior year statement of fnancial actvites
Unrestricted
funds
£		 Restricted
funds
£		 Endowment
funds
£		 Total 2022
funds
£
Income from
Donatons and legacies 7,511,642 2,770,962 - 10,282,604
Charitable actvites: Statutory funding 996,013 1,238,976 - 2,234,989
Trading actvites 5,101,470 - - 5,101,470
Investments 475,078 59,098 - 534,176
Other 155,857 - - 155,857
Total income 14,240,060 4,069,036 - 18,309,096
Expenditure on
Trading actvites 3,948,812 - - 3,948,812
Total income net of trading expenditure 10,291,248 4,069,036 - 14,360,284
Expenditure on
Raising funds 1,969,748 - - 1,969,748
Investment management fees 100,374 - - 100,374
Net income available for
charitable actvites		 8,221,126 4,069,036 - 12,290,162
Charitable actvites
Care of children, young people and families 4,856,017 4,007,465 - 8,863,482
Total expenditure 10,874,951 4,007,465 - 14,882,416
Net income before gains on investments 3,365,109 61,571 - 3,426,680
Net gains on investments 419,404 - 37,516 456,920
Net income 3,784,513 61,571 37,516 3,883,600
Transfer between funds 53,595 (53,595) - -
Net movement in funds 3,838,108 7,976 37,516 3,883,600
Reconciliaton of funds
Total funds brought forward 41,788,633 601,550 1,605,712 43,995,895
Total funds carried forward 45,626,741 609,526 1,643,228 47,879,495

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 40

Accounting policies

Basis of preparation and accounting policies

CHSW is a registered charity with the Charity Commission England and Wales (charity number 1003314) and was incorporated as a private company limited by guarantee (company number 02620879). Its registered office is Little Bridge House, Redlands Road, Fremington, Barnstaple, Devon EX31 2PZ. This is also the registered address of the subsidiary.

The following accounting policies have been applied consistently in dealing with items that are considered material in relation to the financial statements:

(a) Basis of preparation of accounts

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard (FRS 102) applicable in the UK and Republic of Ireland (effective 1 January 2015) (Charities SORP (FRS 102)), the Companies Act 2006 and Charities Act 2011.

CHSW meets the definition of a public benefit entity under FRS 102.

These financial statements consolidate the results of the charity and its wholly owned subsidiary, C H S W Promotions Limited, on a line by line basis. All intergroup transactions are eliminated on consolidation.

A separate statement of financial activities and income and expenditure account for the charity has not been presented because the charity has taken advantage of the exemption afforded by section 408 of the Companies Act 2006. The charity has taken advantage of the exemptions in FRS 102 from the requirements to present a charity only cash flow statement and certain disclosures about the charity’s financial instruments.

(b) Going concern

The group has cash resources and no requirement for external funding to fund normal operating activities. The Trustees believe that there are no material uncertainties about the group’s ability to continue in operating existence for the foreseeable future, having reviewed our financial position, reserves levels and future plans. In forming these conclusions, the Trustees have considered the ongoing financial impact of COVID-19. They continue to believe the going concern basis of accounting appropriate in preparing the annual financial statements.

(c) Fund accounting

Restricted funds are those to be used in accordance with specific instructions imposed by donors or which have been raised by the charity for specific purposes. The aim and use of each restricted fund are set out in the notes to the accounts where material.

The Baylis Endowment Fund is to be retained for the benefit of the charity as a capital fund. The income generated from the capital is restricted due to the wishes of the donor. The Bayliss Endowment Fund included in these accounts is an expendable endowment.

The CHSW Care Endowment Fund (CCEF) exists to support the management of excess unrestricted reserve holdings which usually arrive in the form of unexpected and unpredictable windfalls from legacies. The fund is available to be spent (expendable endowment) to support the long-term sustainability of the charity and to ensure that care services are, as far as possible, always maintained.

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objectives of the charity.

The Trustees have designated certain unrestricted funds as capital funds, representing the net book value of the unrestricted fixed assets used to enable CHSW to carry out its charitable work.

(d) Income

Income is recognised when the charity has entitlement to the funds, any performance conditions attached to the income have been met, it is probable that the income will be received and the amount can be measured reliably.

Income from voluntary sources is received by way of donations and gifts and is included in full in the Statement of Financial Activities when receivable.

Income from Gift Aid tax reclaims is recognised for all donations made prior to the year end, where valid

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 41

Accounting policies

Gift Aid declarations are held and allocated to the same fund as the underlying donation.

Donated services and facilities

Properties, investments, and other fixed assets donated to the charity are included as income and recognised as assets at market value at the time that the charity takes control of the item. Donated services and facilities are included as income, if material, at their estimated value to the charity when received, and under the appropriate expenditure heading depending on the nature of service provided, at the same value and time. Although it is of significant value to the charity, time donated by the charity’s many volunteers and Friends Group members is not recognised in the accounts as it cannot be reliably valued and is specifically exempted by the SORP. Details of the role played by volunteers and the nature of their contribution can be found in the Trustees’ Report.

Stocks of donated goods for resale cannot be measured reliably in a cost-effective manner, due to the high volume of low value items received. Therefore donated goods for resale are not recognised on receipt, but their value is recognised as income when sold.

Legacy income

Legacies are recognised when the charity is entitled to the funds (when there is a valid will and they are notified of the benefactor’s death) when receipt is probable (indicated by the grant of probate) and the charity can reliably estimate the legacy income receivable.

Recognition is therefore dependent upon the type of legacy:

Where legacies have been notified to the charity but the criteria for income recognition have not been met the legacy is treated as a contingent asset and disclosed if material (note 26).

Income received in advance

Income received in advance of an event or provision of another specific service, is deferred until the criteria for income recognition are met.

Interest received

Interest on funds held on deposit is included when receivable.

Investment income

Investment income is credited to income on an accrual basis.

Grants (including Government grants)

Grants received for specific purposes are accounted for as restricted funds. Grants that provide core funding or are of a general nature provided by charitable foundations are recorded as donations. The grants detailed in note 4 have been included as income from charitable activities as they relate to the provision of care. Grants are recognised in full when entitlement is established.

(e) Expenditure

Expenditure is accounted for on an accrual basis and is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Expenditure has been classified under the following activity headings:

The treatment of Value Added Tax (VAT) is detailed in (h) on page 43.

Support costs include central functions and are allocated to activity costs categorised on a basis consistent with the use of resources. This allocation is carried out on a substantive activity basis and does not take account of incidental use.

Governance costs are included within support costs and comprise the costs of running the charity. This includes external audit, any legal advice for the Trustees and all

costs of complying with constitutional and statutory requirements such as the costs of Board and Committee meetings.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

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Accounting policies

(f) Operating leases

Rentals applicable to operating leases, where substantially all the risks and rewards of ownership remain with the lessor, are charged in the statement of financial activities during the life of the lease on a straight line basis. They include retail shops, vehicles and photocopiers.

(g) Pension costs

The charity contributed to 1 defined benefit scheme in the year but also operates a defined contribution pension scheme. Pension costs charged to the statement of financial activities represent the contributions payable by the charity in respect of the accounting period. Both schemes are accounted for as defined contribution schemes. Note 23 provides a detailed explanation.

(h) Taxation

The charity is exempt from Corporation Tax on its charitable activities.

The charity is registered for VAT. Irrecoverable VAT is allocated to the areas in which it is incurred.

(i) Tangible and intangible fixed assets

Tangible and intangible fixed assets are depreciated and amortised in equal annual instalments, using the straight-line basis, during their estimated useful lives, as follows:


as follows:
Litle Bridge House, Charlton Farm
and Litle Harbour		 50 years
Other freehold buildings 5 to 50 years
Leasehold property Life of lease
Medical equipment 5 to 10 years
Furniture and equipment; fxtures
and ftngs		 4 to 20 years
Garden, play and external equipment 5 to 10 years
Sof furnishings 4 to 5 years
Computer equipment and sofware 3 to 5 years
Motor vehicles 4 years

No depreciation is provided on freehold land.

The cost of minor additions, defined as those costing less than £500 each, are expensed in the year in which they are incurred.

(j) Fixed asset investments

Assets held with the intention of retaining them long-term for the continuing benefit of the charity through income and capital appreciation are classified as fixed asset investments. These may include investments listed on a recognised stock exchange (or ones valued by reference to such investments, such as common investment funds, open ended investment companies, and unit trusts), investment land or properties, investments in subsidiary undertakings, and cash held for investment purposes.

Fixed asset investments, other than cash deposits, are stated at market valuation and any gains or losses are dealt with in the statement of financial activities.

Following the granting of planning permission in 2022 for land owned by the charity at Yatton, North Somerset, fixed asset investments include a revaluation of the land recognising its potential development opportunity. The land was valued by an independent agent on 31 March 2023.

Investment in the subsidiary is stated at cost.

Current asset investment

During the year the property which was included in current asset investments in 2022 was sold realising a gain of £45,900.

(k) Stock

Stock consists of purchased goods for resale. Purchased goods for resale are valued at the lower of cost and net realisable value, after allowing for obsolete and slow moving stock.

Children’s Hospice South West - Annual Report and Financial Statements year ended 31 March 2023

Page 43

Accounting policies

(l) Debtors

Other debtors, legacies receivable and accrued income are recognised at the settlement amount due after any trade discounts. Prepayments are valued at the amount prepaid net of any trade discount.

(m) Cash at the bank and in hand

Cash at the bank and in hand includes cash in hand and cash held by financial institutions.

(n) Creditors

Creditors are recognised when the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably.

(o) Financial instruments

The charity only has basic financial instruments that result in the recognition of financial assets and financial liabilities. Financial instruments include cash at the bank, trade debtors, legacies receivable, accrued income from financial instruments (comprising dividends and interest due from investments), trade and sundry creditors and accrued expenditure. Financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

(p) Significant estimates and judgements

Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates are especially significant:

Useful economic lives of tangible and intangible assets The annual depreciation and amortisation charges for the tangible and intangible assets are sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are amended when necessary to reflect current estimates and the physical condition of the assets. See notes 11 and 12 for the carrying amount of the tangible and intangible assets and policy (i) for the useful lives for each class of asset.

Impairment of debtors

The group makes an estimate of the recovery of trade debtors and other debtors. When assessing the impairment of trade debtors and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience.

Provisions

The group has estimated the anticipated costs of dilapidations across its retail operations based on the age of the lease and the fit out costs.

The group has estimated the potential maximum claw-back on its retail grant income based on legal advice received and detailed calculations.

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Audit report

Independent auditor’s report to the members of CHSW

Opinion

We have audited the financial statements of Children’s Hospice South West (‘the charitable company’) and its subsidiary (‘the group’) for the year ended 31 March 2023 which comprise the Consolidated Statement of Financial Activities, Consolidated and Charity Balance Sheet, Consolidated Cash Flow Statement and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the Financial Reporting Council’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustee’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company’s or the group’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.

Other information

The Trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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

We have nothing to report in this regard.

Thank you for providing a safe space for me to talk about my brother. It has been so valuable to have people in my life who have met and known him so well, which always made sharing my thoughts and feelings that bit easier.

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Audit report

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report included within the Trustees’ report.

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

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

Auditor’s responsibilities for the audit of the financial statements

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.

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

Responsibilities of Trustees

As explained more fully in the Trustees’ responsibilities statement set out on page 21, the Trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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Audit report

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charitable company and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, the Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company and the group for fraud. The laws and regulations we considered in this context were Care Quality Commission (CQC) Regulations.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing of recognition of income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management and the Investment and Finance Committee about their own identification and assessment of the risks of irregularities, designing audit procedures over income, sample testing on the posting of journals, reviewing accounting estimates for

biases, reviewing regulatory correspondence with the Charity Commission, and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

Use of our report

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

Guy Biggin Senior Statutory Auditor

For and on behalf of Crowe UK LLP Statutory Auditor 4th Floor, St James House, St James Square, Cheltenham GL50 3PR

Date: 8 December 2023

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Structure, governance and management

CHSW is a registered charity with the Charity Commission in England and Wales (charity number 1003314) and was incorporated as a private company limited by guarantee (company number 02620879), on 17 June 1991. Legal and company information is set out on page 52 and lists the Directors and Trustees, the SMT and the principal advisors and forms part of this report.

The principal object of the charity

The charity was established ‘to promote the relief of illness and suffering in such ways as the Association shall from time to time think fit, and particularly in the South West counties of England and adjacent areas and in particular:

Organisational structure

The charity is constituted as a company limited by guarantee, and, therefore, is governed by a Memorandum and Articles of Association and has no share capital.

The charity has a wholly owned subsidiary, C H S W Promotions Limited. The principal activity of the subsidiary is the sale of promotional and bought in goods in support of CHSW.

The Directors of this subsidiary throughout the year, unless otherwise stated, are as follows:

Nicola Mason, CHSW Trustee

All Directors of CHSW, (excluding the SMT), are also Trustees of the charity and there are no other Trustees. All but 2 of the Trustees named on page 52 served throughout the year and until the date this report has been signed, unless otherwise stated.

The charity is organised so that the Trustees meet collectively 4 times a year to direct the management of its affairs. Strategy days are also held periodically. The members (the members of the charity include all Trustees and 3 other individuals) of the charity may, by ordinary resolution, appoint persons who are willing to act to be Trustees.

I write this letter to express my sincere thanks and gratitude for the fantastic care and support my family have received throughout the short life of our dear Grandson.

In pursuing the principal objectives of the charity, activities that CHSW provides to the families in the South West are detailed on page 8 to 13.

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Structure, governance and management

Assurance Committees

In addition to regular Board meetings, with the attendance of all Trustees and the SMT, delegated authority has been given to Assurance Committees to assist the Board in several functional and risk areas of the charity. These Assurance Committees are attended by Trustees with relevant skills and experience, meet at least 3 times per year and report directly to the Board. They currently include:

Appointment of Trustees

The Board of Trustees is responsible for confirming the appointment of a new Trustee following a clear recruitment and selection policy and procedure. The term of office is 3 years after which period a Trustee must seek re-appointment by the Board if he or she wishes to continue as a Trustee. There is currently a 3 term maximum on the number of terms of office a Trustee can serve.

CHSW will ensure it maintains and enhances its own accountability and wider public confidence in its work by:

New Trustees are offered a programme of induction which includes reading a certain amount of literature, meeting with some of those who lead the charity, and gaining some first-hand experience of situations in which we work. The programme of induction contains the following elements:

A document pack including:

Management

The day-to-day operation of the charity is carried out by SMT, listed on page 52, who have delegated responsibility and are employees of the charity.

Care throughout the charity is provided under the direction of the Director of Care, Allison Ryder. The Fundraising Team work under the direction of the Director of Fundraising, Paul Courtney. The Director of Marketing and Communications, Jessica Patel, oversees marketing and communication issues together with IT services. The finance function is overseen by the Director of Finance and Retail, Jonathan Webber. Jonathan is also Company Secretary and is responsible for retail trading operations.

The Director of HR, Daphne Sands, is also responsible for facilities management and health and safety.

The above members of SMT report to the Chief Executive, Eddie Farwell, who oversees all operational and strategic matters.

SMT remuneration, including that of the Chief Executive, is reviewed annually by the Governance Assurance Committee. Senior management remuneration is established and reviewed periodically based on the Hay Group methodology in respect to job evaluation and also having due regard to CHSW’s duty to ensure best value and after taking advice on pay levels, market conditions and other relevant factors.

Other than allowable business expenses, CHSW makes no payments in addition to the basic salary to the Chief Executive and SMT for undertaking their core role. Any authorised additional hours will be subject to the conditions in line with all staff.

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Structure, governance and management

Employees

CHSW is committed to the principle of equal opportunities in employment and recognises its obligations under the Equality Act 2010. CHSW declares its opposition to any form of less favourable treatment, whether through direct or indirect, associated or perceived discrimination accorded to CHSW staff, or job applicants, on the grounds of their race, nationality or ethnic origin, disability, sex, age, sexual orientation and gender reassignment, marital and civil partnership status, pregnancy and maternity, religion or belief, (otherwise known as ‘protected characteristics’ as defined by the Equality Act 2010), including Human Rights.

CHSW is committed to creating a positive culture of respect for all CHSW staff and promoting positive practices and valuing the diversity of all individuals and communities.

CHSW embraces and recognises the importance of diversity, that different people bring different perspectives, ideas, knowledge and culture, and that this difference brings great strength as well as contributes to employee wellbeing and engagement.

Our aim is to create a culture that respects and values each person’s differences, promotes dignity, equality, diversity and inclusivity, and that encourages individuals to develop and maximise their true potential.

We expect commitment and involvement from all CHSW staff, partners and providers of goods and services in working towards the achievement of our aim. Continued close attention is paid to the health and safety of employees while at work and all employees are provided with appropriate training in compliance with our CHSW Health and Safety Policy.

Employee views are sought through several forums including 121s, team meetings, steering groups, staff survey and the Staff Council. CHSW’s strong ‘Speaking Up’ culture is also supported by a team of Freedom to Speak Up Champions from across the charity which includes a Trustee. There were no concerns raised via the Whistleblowing Policy this year. Information concerning the charity and its activities and performance are shared with employees through several mediums including Internal Communications via email, the Staff Intranet, and Site Meetings. These forms of communication are constantly evolving and the use of video conferencing over Zoom and Teams has become embedded into our new ways of working.

Engaging with our stakeholders

The CHSW Trustees set out to define discrete stakeholder groups and recognise that in many cases they have complementary interests and shared priorities. Stakeholders identified include children and young people living with life-limiting conditions, their families, donors, staff, volunteers, ICBs, local communities, contractors, suppliers, and our Patron.

The Trustees have in place a strategy for regular and effective communication with these stakeholders about the charity’s purposes, values, work and achievements. Examples of this include marketing strategies and a family engagement programme.

The Trustees communicate how the charity is governed, who they are, and decisions being made through the CHSW website and the Trustee Annual Report. The Trustees ensure that stakeholders have an opportunity to hold the board to account through agreed processes and routes such as Friend’s Group Conferences, Volunteer Appreciations days, Parent Forums, Parent Feedback Questionnaires, Staff Council and regular Staff Surveys.

The Trustees make sure there is suitable consultation with stakeholders about significant changes to the charity’s services or policies.

Memberships

To assist in its decision making and to ensure current and best practice is always followed, the charity is an active participant in the membership of several ‘not for profit’ organisations. These include the following:

Related parties

CHSW has a trading subsidiary C H S W Promotions Limited which is responsible for the sale of all new goods, including Christmas cards. The relationship between the 2 organisations is set out in a memorandum of understanding.

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Structure, governance and management

Energy and carbon reporting

Charity governance code

CHSW is a not-for-profit organisation which aims to follow charity sector best practices. The Charity Governance Code for larger charities was adopted into our new Governance Framework, which was completed in March 2021. The code sets out the principles and recommended practice for good governance and is a tool for continuous improvement towards the highest standards.

In November 2019, CHSW engaged an independent firm of consultants to demonstrate compliance under the Energy Savings and Opportunities Scheme (ESOS). This piece of work involved assessing the charity’s current energy usage including business, transport, and process, and suggesting energy-efficient opportunities. This requires compliance every 4 years and is due again in 2023.

In the year ended 31 March 2023, the charity’s annual energy usage as 1,526,541 kWh (2022: 1,436,224 kWh) which equates to 341,654 CO2e (2022: 406,552 CO2e). When assessed against the charity’s charitable spend of £9,754,369 this gives an intensity ratio of 1 CO2e: £29 charitable spend.

Our governance and risk frameworks were reviewed and updated last year. Our focus for this year will include Trustee recruitment and continuing with our stakeholder’s voice reviews to support the strategic development of our care.

CHSW completed its first Annual Green Agenda Report for 2022 to 2023. The achievements and actions taken against our stated ambitions include:

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Reference and administration

----- Start of picture text -----
Company number 02620879
Charity number 1003314
Trustees Stephen Hindley CBE, DL
David Turner
Karen Rogers
Nicola Mason
Patricia Morris
Alan Broughton
Roger Knight (Treasurer)
Elizabeth Childs
Kate Martin
Stewart Davidson (appointed 26 January 2023)
Andrew Gould (appointed 26 January 2023)
Secretary Jonathan Webber
Registered office Little Bridge House, Redlands Road, Fremington, Barnstaple,
Devon EX31 2PZ
Senior Management Chief Executive (CEO): Eddie Farwell MBE, Hon LLD
Team (SMT)
Director of Care: Allison Ryder
Director of Finance and Retail: Jonathan Webber
Director of HR: Daphne Sands
Director of Fundraising: Paul Courtney
Director of Marketing and Communications: Jessica Patel
Advisors Principal Bankers: Barclays Bank Plc
3rd Floor, 3 Bedford Street, Exeter EX1 1LX
Principal Solicitors: Burges Salmon LLP
1 Glass Wharf, Bristol BS2 0ZX
Investment Managers: Aberdeen Standard Capital Limited
1 George Street, Edinburgh EH2 2LL
Investment Managers: Sarasin & Partners LLP
Juxon House, 100 St Paul’s Churchyard, London EC4M 8BU
Independent Auditor: Crowe UK LLP Statutory Auditor
4th Floor, St James House, St James Square, Cheltenham GL50 3PR
----- End of picture text -----

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Fundraising standards

Valuing our supporters and upholding high standards

Children’s Hospice South West is committed to ensuring that all of the wonderful and varied methods of fundraising are always safe, respectful, transparent and accountable. As such, we are fully registered with the Fundraising Regulator which enables people to give with confidence. We also ensure that all regulatory updates and developments are acted upon and shared with all Fundraising Teams and Volunteers, with a commitment to a consistent training and monitoring programme. This includes annual training on the Code of Fundraising Practise. In addition to regulatory compliance, we also actively encourage and provide opportunities for our Fundraising Team to attend local, regional and national conferences and training that keeps them up to date with sector trends, developments and innovations in fundraising.

The high standards of fundraising that we expect of our teams also extend to those acting on behalf of CHSW. Volunteers receive extensive training to ensure they are up to date with the standards set out in the Code and any agencies or commercial participators to whom we entrust the CHSW brand must demonstrate their commitment to and active compliance with the Code both before work commences and during ongoing work.

In the year to March 2023, CHSW was supported by 2 external agencies to increase the membership of our Raise a smile Lottery, Engage & Connect and The Fundraising Partnership. Both agencies carried out door-to-door and venue-based fundraising. All Canvassers employed by both agencies receive rigorous training, which is monitored and consolidated by annual training delivered by CHSW’s Director of Fundraising. Regular reviews of agency activity, quality assurance calls and questionnaires and a spot-check mystery shopping framework all help to ensure that CHSW’s highest standards are reflected by those employed by these Professional Fundraising Organisations.

During the year, there were several Customer Relationship Management (CRM) agreements with companies partnering with us to raise funds. These agreements were reviewed regularly to ensure companies carrying the CHSW logo acted in line with the standards expected at all times and represented no reputational risks. No agreements are entered into without due diligence and adherence to CHSW’s Ethical Fundraising and Donation Acceptance Policy.

While we are committed to these very high standards, there are times when we do receive complaints and people feel the need to raise a concern about our fundraising. This year we have updated our recording of complaints and concerns to more accurately record the issues raised, as follows:

Department Complaint Concern raised
Fundraising 1 3
Marketng 4 0
Lotery 5 1
Database
Administraton		 0 2

All complaints and concerns were reviewed and resolved in line with CHSW’s Complaints Policies and no further escalation or involvement of external regulators was required.

Everyone at CHSW is committed to behaviour and communications that ensure no potential or existing supporter ever feels under any undue pressure to support our work.

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www.chsw.org.uk enquiries@chsw.org.uk

Redlands Road, Fremington, Barnstaple, Devon EX31 2PZ 01271 325 270

Charlton Drive, Wraxall, North Somerset BS48 1PE 01275 866 600

Porthpean Road, Porthpean, St Austell, Cornwall PL26 6AZ 01726 871 800

Please note that no part of this report may be reproduced without the prior consent of Children’s Hospice South West.