Stepping Stone Projects Annual Report 2024-25 q Jbi -w REDFEAgN .. ••,
Stepping Stone Projects Table of Contents 03. Information 07. 08. 09. Vision & Mission Reflecting on 40 Years of Progress Our Purpose and Public Benefit 10. 2024125: A Year of Achievement A Year of Expansion 12. 13. 14. Customer Stories Driving Change Beyond Service Delivery Financial Review 17. Looking Ahead 18. Statement of Trustees Responsibilities 19. Independent Auditors Report 22. Statement of Financial Activities 23. Balance Sheet 24. Statement of Cash Flows 25. Notes to the Financial Statements
Stepping Stone Projects Information Chair Company Secretary Mr Christopher Tait Ms Susan Ashby Charity Trustees Ms Susan Ashby Mrs Janet Hardwick Mr David Berry Mr Nicholas Cox Mr Alexander Lyons Mr Steven Grycuk Mr Colin Royle Ms Elizabeth Lilley Ms Michaela Orr Mr Martin Davies Chief Executive Officer Mr David Smith Company Number 02647645 Registered Charity Number 1004375 Registered Office 2 The Quadrant, Green Lane, Heywood, OL10 1NG Auditors BK Plus Audit Limited, Sterling House, 501 Middleton Road, Chadderton, Oldham, OL9 9LY Bankers Bank of Scotland, Ground Floor, Teviot House, 41 South Gyle Crescent, Edinburgh, EH12 9DR Solicitors Wrigley Claydon, 29133 Union Street, Oldham, OL1 1 HH Annual report 2024-25
Stepping Stone Projects How is SSP Governed and Managed The Trustees, who are also directors for the purposes of the Companies Act, present their report and audited financial statements for the year ended 31 March 2025. The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the charity's governing document, the Companies Act 2006, FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Charities SORP "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" Structure Stepping Stone Projects is a company limited by guarantee, its governing document being its Memorandum and Articles of Association. The company was incorporated on 20 September 1991 (company number 2647645) and is a registered charity (number 1004375). The directors of the company are its Trustees for the purposes of charity law and under its Memorandum and Articles of Association are collectively referred to throughout this report as The Board of Trustees. The Charity's principal objectives are to relieve persons who are homeless or in necessitous circumstances. Governance Stepping Stone Projects has a Board of Trustees of up to fourteen members, who are responsible for strategic direction and policy. At present the Charity has ten members from a variety of professional backgrounds relevant to the work of the organisation. The trustees during the year were: Ms Susan Ashby Mrs Janet Hardwick Mr David Berry Mr Nicholas Cox Mr Alexander Lyons Ms Kelly Webb Mr Steven Grycuk Mr Colin Royle Ms Elizabeth Lilley Ms Michaela Orr Mr Martin Davies Annual report 2024-25
Stepping Stone Projects Ms Kelly Webb resigned on 27 November 2024. Trustees thank Kelly for her commitment and contribution to the organisation. Under the requirements of the Charity's Memorandum and Articles of Association the Chair is elected annually. Other members of the Board of Trustees are elected for a period of three years, after which they must be re- elected at the next Annual General Meeting. The Board of Trustees meets every six weeks with the agenda focus alternating between strategy and compliance l assurance activities. In addition each trustee serves on one of our two sub- committees (Finance and Remuneration. Risk and Compliance) both of which meet quarterly. Recruitment of Trustees to the Board of Trustees The Board of Trustees tries to ensure that the needs of this group are fully reflected in the diversity of skills and experience of the Trustee body. The Charity has through selective advertising and open networking sought to recruit suitably qualified individuals to use their skills and expertise to assist the Company. Traditional business skills are well represented on the Board of Trustees. In an effort to maintain this broad skill base members are requested to provide a comprehensive list of their skills, which is updated annually. Following the resignation at the 2023124 AGM, a fresh recruitment process was undertaken and following initial interviews one candidate was approved as a potential trustee and attended the January board meeting as an observer. The appointment of Mr Martin Davies was unanimously formally approved by trustees at th the 19 of February board meeting. We were delighted to welcome Martin as a trustee, given his extensive experience working in Social Housing for 36 years most recently as Director of Development at a leading North West housing provider. None of the trustees has any beneficial interest in the company. All of the trustees are members of the company and guarantee to contribute £1 in the event of a winding up. Annual report 2024-25
Stepping Stone Projects Management Day-to-day responsibility for the provision of services is delegated to the Senior Leadership Team consisting of a Chief Executive, Director of Operations, 2 x Assistant Director of Operations, a Director of Resources and temporarily our Digital Transformation Specialist, none of whom is a director as defined by company law. Systems of internal controls are designed to provide reasonable, but not absolute, assurance against material misstatement or loss. They include: A strategic plan, annual delivery plans and budget approved by the Trustees; Regular consideration by the Trustees of operational service delivery and financial results, variance from budgets, non-financial performance indicators and benchmarking reviews; Delegation of authority and segregation of duties; Identification and management of risks. The Trustees have introduced a formal risk management process to assess business risks and implement risk management strategies. The risk strategy policy comprises: An annual review of the risks the Charity may face; The establishment of systems and procedures to mitigate those risks identified in the The implementation of procedures designed to minimise any potential impact on the Charity should any of those risks materialise. An element in the management of financial risk is our reserves policy and its annual review by the Trustees. Training All new Trustees are invited and encouraged to attend a series of short induction sessions to familiarise themselves with the Charity and its workings. The Chair and the Chief Executive of the Charity jointly lead these sessions which include details of.. The fiduciary responsibilities of the Board of Trustees under charity and company law; The operational framework of the Charity and its decision-making process. The contents of its Memorandum and Articles of Association; The Business Plan which sets out its future plans and objectives. and The latest set of statutory accounts. Use is also made of various Charity Commission publications, in particular "The Essential Trustee" guide, which is included in the information pack sent to all new and potential Trustees. New Trustees are encouraged to feed back to the Chair on the induction process. Annual report 2024-25
Stepping Stone Projects Vision & Mission Vision Together we can end homelessness by 2034 Mission 01 Prevent Homelessness 11.,. 02 Support Independence 03T ransform Lives Our Corporate Strategic Plan 20 1034 VISION MISSION Togetkier we can end homelessness by 2034 Prevent homelessnes5 Support independence Transform lives Stepping Stone Projects EST FO VALUES Customers Colleagues Partners Business PRIDE Proressional Respectful Inclusive Dynamic Excellent Annual report 2024-25
Stepping Stone Projects Reflecting on 40 Years of Progress In 2024125, Stepping Stone Projects (SSP) proudly celebrated 40 years of supporting people experiencing homelessness. We marked this important milestone with a year-long programme of inclusive events for our customers, colleagues, commissioners, and partners. Each month, we hosted a major event that brought people together and raised awareness of homelessness in the North West. Highlights included: A launch campaign across press and social media Customer and Partner Roadshows in Rochdale, Burnley, Blackburn, and Manchester A 40-mile sponsored colleague relay in aid of Andy's Man Club Volunteer activities with local schools, including mock interviews and industry workshops Planting 40 trees to create a lasting legacy A Gala & Christmas Lunch hosted by Terry Christian, attended by over 200 guests 40 home move-on packs provided to customers, funded by partners Colleague Sports Day- football & netball tournaments From humble beginnings in 1984 with just two properties for rough sleepers in Rochdale, SSP now manages over 850 homes, delivers 45 services across 25 boroughs, supports more than 1,000 individuals at any given time, employs around 195 colleagues, and maintains a turnover of approximately £15 million. We remain steadfast in our mission to prevent homelessness, support independence, and transform lives, and we continue to strive toward our vision: Together, we can end homelessness by 2034. •49*"8J .:1 ! ¥ Stepping Stone Annual report 2024-25
Stepping Stone Projects Our Purpose and Public Benefit Our governing documents define our mission to support people who are homeless, at risk of homelessness, or otherwise vulnerable, by: Providing advice and person-centred support Offering temporary and longer-term accommodation Delivering housing-related support and intensive management services We uphold the belief that everyone has a right to safe, quality accommodation and services that help them achieve independence. We act in accordance with Charity Commission guidance to ensure we deliver public benefit in all we do. Our Trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake. Annual report 2024-25
Stepping Stone Projects 2024125: A Year of Achievement Despite national challenges, from economic uncertainty and a shifting political landscape to the ongoing housing crisis, SSP has remained focused on delivering impact. We are proud to report that in 2024125, we: Retained all 2023124 contracts, including key re-tendered UASC services in Lancashire and Manchester Added 109 new homes and launched 7 new services Expanded into 7 new local authorities across North and West Lancashire oofl Sustained and improved customer satisfaction Invested in digital transformation, launching the SSP Connect customer portal and introducing Docusign technology Secured Ofsted registration for both of our young people's services Deepened investment in colleagues, development, well- being, and added social value across our operations 10 Annual rewl 2024-25
Stepping Stone Projects A Year of Expansion: Young Peoples Services We made significant progress in 2024125 in expanding support for young people: Gained Ofsted registration under new regulations Successfully delivered our first Ofsted inspection Expanded our North-west Care Leavers programme Secured a new contract to provide dispersed housing in North and West Lancashire, adding 38 homes Retained our East Lancashire service, converting additional properties into long-term supported accommodation Continued to grow UASC services, with new sites in Tameside, Trafford, and Stockport Other New Services Launched a new service in Trafford providing 10 homes for homeless families Opened a renovated 5-bed HMO in Wigan in partnership with Jigsaw Housing These developments show how we continue to respond flexibly to local needs across the North West. Annual report 2024-25
Stepping Stone Projects Customer Stories Dillon Dillon first came into contact with Stepping Stone Projects in Rochdale before a period in custody resulted in a move to Bury. Following his release, he was supported in our temporary accommodation, and after a second recall to custody, he was assessed for CAS3 support on both occasions. During his second CAS3 placement, we worked in close partnership with Bury Council, who agreed to 'flip' one of our RSAP properties to become Dillon's longer-term home. This allowed us to extend our support for up to three years, providing the stability and consistency he needed. That continuity has been transformative. Dillon is now preparing to move into his own social housing tenancy, supported by a Tenancy Support Officer from Bury Council. His journey highlights how collaborative, flexible partnership working can lead to meaningful and lasting outcomes for individuals rebuilding their lives after homelessness and custody. Louise Louise's journey through the A Bed Every Night project demonstrates the powerful impact of targeted support. After experiencing homelessness at just 19, she received essential help through the Rough Sleeping Accommodation Programme, enabling her to secure a stable tenancy and create a home of her own. With her housing situation settled, Louise expressed a desire to move into employment and will soon begin a new role as a support worker for adults with learning disabilities. To help her take this next step, Stepping Stone Projects provided financial support for her DBS checks. Louise's experience reflects the life-changing outcomes our services can achieve and aligns with our recent customer survey, which reported a 99 % satisfaction rate. Her story is a testament to resilience and the effectiveness of coordinated, person-centred support. 12 Annual report 2024-25
Stepping Stone Projects Driving Change Beyond Service Delivery SSP continues to campaign alongside partners to: Raise awareness of homelessness Advocate for funding and policy change Promote solutions that prevent homelessness and support recovery We know that the key to future success lies in staying agile, innovative, and focused on value-for-money services while minimising internal bureaucracy and maximising the use of technology. At SSP, we know that delivering high-quality housing and support services is only part of the solution to ending homelessness. Driving meaningful, long- term change also requires us to challenge the systems and policies that allow homelessness to persist. That's why campaigning is a core part of our work, raising awareness, influencing decision-makers, and pushing for reforms in housing, welfare, and support provision. By working in partnership with like-minded organisations, we aim to amplify the voices of those with lived experience and ensure that their needs shape the services and policies that affect them. Our campaigning efforts help position SSP not just as a service provider, but as a trusted advocate for social justice and systemic change. 13 Annual report 2024-25
Stepping Stone Projects Financial Review Principal funding sources The principal funding sources for the Charity during the year were: Housing-related support contract income from Rochdale MBC, Bury MBC, Hyndburn Borough Council, Blackburn with Darwen Borough Council, Burnley Borough Council, Manchester City Council and Lancashire County Council. Rental incomefrom tenants and housing benefitpaid on behalf of tenants. Spot purchase of accommodation and housing-related support, for young people leaving care, by social service departments across the North-west via the North-west Care Leavers Framework. Investment income. Other sundry sources of income include corporate and individual donations received. Overview Total incoming resources in the year to March 2025 were £14,458,467 (2024 £11,904,998). This is an increase of 21.50/0 which is mainly due to the growth of existing services including Care Leavers, Rochdale ABEN and Unaccompanied Asylum Seeking Children. There was also an increase in rental income across all services as a result of additional homes in management, annual inflationary increases in rent levels together with a number of other smaller specific variances relating to operational performance. Investment income has increased to £9,159 (2024 £5,426). Investment income is used to finance internally funded charitable support to customers and customer participationldevelopment activities. Additional charitable funds from reserves were utilised to make up for the comparatively low level of investment income and enable us to maintain support for customer activities. Other income has increased by 2040/0 to £49,340 (2024 - £16,210). In the year to 31 March 2025 the Charity made a net surplus (after including investment income) of £358,228 (2023 - £141,182 surplus). From a financial perspective, this has been a challenging but ultimately successful year. All services made a positive contribution to central costs apart from two services. Saxonside which incurred additional costs due to significant staffing absences and Manchester RSAP which made a deficit of £54,662 as the service is being decommissioned. 14 Annual report 2024-25
Stepping Stone Projects Financial Review continued The budget for 2025126 reflects the continuing growth in services with further increases in turnover and another surplus of approximately £275k. Despite the ongoing challenging financial circumstances resulting from continuing pressures on Local Authority spending, the charity continued to maximise the proportion of total expenditure on charitable activities maintaining a very similar amount and reduced proportion of expenditure on governance costs to the previous financial year. Direct charitable expenditure accounted for 99.79 % (2024 - 99.76'/0) and governan costs, including those costs associated with meeting the constitutional and statutory requirements of the charity such as the audit fees and costs linked to the Strategic Management of the charity, accounted for 0.21 % (2024 - 0.240/0) of total expenditure. Trustees decided that the basis for allocating costs that was adopted in the financial year ending 31 March 2014 was still the most appropriate method by which to fairly reflect actual expenditure. Balance Sheet The net book value of fixed assets decreased to £915,951 from £979,212 in the previous year. The decrease is due to depreciation charges exceeding the amount of additions in all categories. The main fixed assets are the four Care Leavers properties in Pendle which had a net book value of £172,136 in both years plus St. Clare's House which had a net book value of £439,704 (2024 - £449,560). Reserves Policy Trustees recognise that whilst the building of reserves is essential to give the Charity sufficient flexibility to cover temporary interruptions in income flow and provide an adequate level of working capital, particularly due to the ongoing levels of uncertainty surrounding Local Authority spending targets following reductions in funding from Central Government, this should not be detrimental to charitable activities and the provision of quality services to customers. The Board of Trustees has an annual review of its policy on minimum reserve levels, which are the free reserves of the Charity, earned from previous operations. The current reserves policy was adopted in the previous financial year when Trustees decided that the reserves policy should provide sufficient reserves to deal with the loss of the charity's short-term contracts in an orderly manner and enable current activities to be continued whilst alternative contracts are secured. 15 Annual report 2024-25
Stepping Stone Projects Financial Review continued The most significant change to the policy was to create a new designated reserve commensurate with the amount of reserves tied up in fixed assets and thus not freely available. Trustees discussed the risk factors and concluded that the likelihood of losing all services at once is still remote and that the essence of the previous reserves policy remains appropriate having considered the corporate risk register and other pertinent factors. Trustees identified that there were three main types of expenditure within the charity: Propety costs (property rental, maintenance, utility charges etc.) are basically funded via rental income; Support costs (mainly staffing but also costs such as offices, stationery etc.) are basically funded via contractual income; Central costs (again mainly staffing but also ICT, office costs etc.) are funded via a combination of rental and contractual income. Thus, the reserves policy requires an amount equivalent to three months of all non- property costs, except for those on services with more than a 12-month contract or where SSP owns the building, plus amounts to cover dilapidations and a redundancy provision as outlined above. It is considered that the existing designated reserve is adequate provision against dilapidations claims. The reserves policy requires free reserves of £1.92m at 31 March 2025 compared with the actual amount of £2,268,384 leaving £348k free to expand the services that we offer to customers. This is in addition to the designated reserves of £915,951 covering fixed assets and £585,524 which is to provide for renewal of furnishings and any potential dilapidations claims arising if properties are handed back to landlords. Financial risk management objectives and policies The company makes little use of financial instruments other than operational bank accounts and fixed term deposits with reputable banks, so its exposure to price risk, credit risk, liquidity risk and cash flow risk is not material for the assessment of the assets, liabilities, financial position and net movement of funds of the company. 16 Annual report 2024-25
Stepping Stone Projects Looking Ahead 2024125 was a year of continued consolidation, growth, and innovation. Thanks to strategic decisions by our Board and the commitment of our entire team, we closed the year with an improved financial surplus of £358k, and strong reserves of £3,770k. We are grateful for the dedication of our colleagues, the leadership of our Senior and Leadership Teams, and the support of our commissioners and partners. Together, we are making a difference, and we will do even more in 2025126. Together, we can, and will, end homelessness. 17 Annual report 2024-25
Stepping Stone Projects Statement of Trustees Responsibilities The trustees, who are also the directors of Stepping Stone Projects for the purpose of company law, are responsible for preparing the Trustees Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Company law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year. In preparing these financial statements, the trustees are required to.. select suitable accounting policies and then apply them consistently; observe the methods and principles in the Charities SORP; make judgements and estimates that are reasonable and prudent; and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue inoperation. The trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence for tsking reasonable steps for the prevention and detection of fraud and other irregularities. Auditor In accordance with the company's articles, a resolution proposing that BK Plus Audit Limited be reappointed as auditor of the company will be put at a General Meeting. The trustees report was approved by the Board of Trustees. Ms Susan Ashby Trustee Date: ... 2GlI!..I Is 18 Annual report 2024-25
INDEPENDENT AUDITOR'S REPORT TO THE TRUSTEES OF STEPPING STONE PROJECTS Opinion We have audited the financial statements of Stepping Stone Projects (the 'charity') for the year ended 31 March 2025 which comprise the statement of financial activities. the balance sheet, the statement of cash flows 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 Uniled 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 statemenls.. give a true and fair view of the state of Ihe charitable company's affairs as at 31 March 2025 and of its incoming resources and application of resources, for the year then ended., have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice,. and have been prepared in accordance with the requirements of the Companies Ad2006. Basls for oplnion We conducted our audit in accordance with Intemational Standards on Auditing (UK) (ISAS {UK)) and applicable law. Our responsibilities under those standards are further described in the Auditorfs spOnSibl11t1eS for the audit of the Inancial statements section of our report. We are independent of Ihe charity in aOrdanCe with the ethical requirements Ihal are relevant to our audit of the financial stalements in the UK. including the FRC'S Ethical Standard, and we have fvlfilled 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 ouropinion. Conclusions relating to going concern In auditing the financial statements. we have concluded that the trustees 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 charity's ability to continue as a going conrn for a period of at least e1ve months from when the financial statements are authorised for issu8. 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 other information comprises the information included in the annual report other than the financial statements and our auditorfs report thereon. The trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. Our responsibility is to read the other infomation and, in doing so, consider whether the other infomiation is malerially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to detemiine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed. we conclude that Ihere is a material misslatement of this other informalion, we are required to report that fact. We have nothing lo report in this regard. Matters on which we are required to report by exception We have nothing to report in respect of the following matters in relation to which the Charities (ArKounts and Reports) Regulations 2008 requires us to report to you if, in our opinion.. the infomiation given in the finanoal statements is inconsistent in any material respect with the truslees report., or sufficient accounting records have not been kept., or the financial statemenls are not in agreement with the accounting records.. or we have not reiVed all the information and explanations we require for our audit. Annual report 2024-25 19
INDEPENDENT AUDITOR'S REPORT {CONTINUED) TO THE TRUSTEES OF STEPPING STONE PROJECTS Responsibilities of trustees As explained more fully in the statemenl of Irustees responsibilities, the trustees, who are also the directors of Ihe charity for the purpose of company law, are sponSible for the preparation of the financial statemenls 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. In preparing the financial statements, the trustees are responsible for assessing the charity'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. Auditorfs rosponslbllltles for the audit of the financial statements We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder. 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 malerial 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 expeded to influence the economic decisions of users taken on the basis of these financial statements. The extent to which our prOdureS are capable of detecting irregularities, including fraud, is detailed below. Obtaining an understanding of the legal and regulatory frameworks that the Charity operates in. focusing on those laws and regulations that have had a direct effect on the financial slatemenls. The key laws and regulations we considered in this context include the Charities Ad. In addition we consider Complian with employee legislation. as fundamental lo the Charity's operations.. Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud., Enquiry of management and those charged with governance around actual and potential litigation and claims- Performing audit work over the risk of management override of controls, including testing of journal entries and other adjuslmenls or appropriateness, evaluating the business rationale of significant transactions oulside the normal course of business and reviewing accounting estimates for bias; Reviewing minutes of meetings of those charged with governance., and Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations. There are inherent limitations in the audit procedures described above and the further removed noncompliance with laws and regulations is from the events and transactions reflected in the financial statements. the less likely we would become aware of it. Also, the risk of not detecling a material misslatement due lo fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or though collusion. A further description of our responsibilities is available on the Financial Reporting Council's websile at.. https'.11 www.frc.org.uklauditorsresponsibilities. This description forms part of our auditor's report. Annual report 2024-25 20
INDEPENDENT AUDITOR'S REPORT (CONTINUED) TO THE TRUSTEES OF STEPPING STONE PROJECTS Based on our understanding of the charitable company, we identified that the principal risks of non-compliance related to those laws and regulations that have a direct impact on the financial statements such as the Companies Acl 2006 and the Charities SORP (FRS 102). We evaluated management's inntiveS and opportunilies for fraudulent manipulation of the financial statements {in¢luding the risk of override of controls), and determined Ihat the principal risks were related to posling inappropriate journal entries to manipulate financial results and management bias in accounting estimales. Appropriate audil procedures were performed to address those risks including testing journal entries and challenging assumptions and judgements made by management in their significant accounling eslimates. There are inherent limitations in the audil procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not delecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. A further description of our responsibilities is availablè on the Financial Reporting Council's website at.. https'.11 www.frc.org.uklauditorsresponsibililies. This description forms part of our auditof s report. Use of our report This report is made solely to the charity's trustees. as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity's trustees 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 charity and the ¢harity's trustees as a body, for our dit work, for this report. or for the opinions we have formed. Dominic Huxley ACA (Senior Ststutory Auditor) For and on behalf of BK Plus Audit Limited, Statutory Auditor Chartered Certified Accountants Sterling House 501 Middleton Road Chadderton Oldham Lancashire OL9 9LY Dale: BK Plus Audit Limited is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 ofthe Companies Act 2006. Annual report 2024-25 21
STATEMENT OF FINANCIAL ACTIVITIES INCLUDING INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 MARCH 2025 Unrestricted funds 2025 Unrestricted funds 2024 Notes Income and endowments from: Charitable activities Investments Other income 14,399,968 9,159 49.34Q 11,883,362 5,426 16.210 Totsl income 14,458,467 11,904,998 Expendlture on: Charitable actiwties 14,100,239 11,763,816 Total expendlture 14,100,239 11,763,816 Net Incomo and movoment In funds 358,228 141,182 Reconciliation of funds: Fund balances at 1 April 2024 3,411,631 3,270.449 Fund balances at 31 March 2025 3,769.859 3,411.631 The stalement of financial activilies includes all gains and losses recognised in the year. All income and expenditure derive from continuin9 activities. Annual report 2024-25 22
BALANCE SHEET AS A T31 MARCH 2025 2025 2024 Notss Fixed assets Tangible assets 12 915,951 979,212 Current assets Debtors Cash at bank and in hand 13 2,390,914 1,189,042 1,696,864 1,244,462 3,579,956 2,941,326 Creditors: amounts falling due withln one year 14 {726,048) (508,907) Net current assets 2,853,908 2,432,419 Total assets less current liabilities 3.769.859 3,411,631 The funds of the charity Unrestricted funds 18 3.769,859 3,411,631 3.769,859 3.411,631 The company is entilled to the exemption from the audit requirement contained in section 477 of the Companies Act 2006. for the year ended 31 March 2025. The directors acknowledge their responsibilities for complying wilh the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements. The members have not required the company to obtain an audit of its financial statements under the requirements of the Companies Act 2006, for the year in question in accordance with seclion476. These financial statements have been prepared in accordance with the provisions applicable to companies Subje lo the small Companies regime. These accounts have been prepared in accordance with the special provisions of part 15 of the Companies Act 2006 relating to small companies and constitute the annual accounts required by the Companies Act 2006 and are for circulation to the members ofthe company. The accompanying notes are an integral part of these financial statements. 261.11.l. z_ The financial statements were approved by the trustees on .. SUSA ,4Srfs"/ Trustse Company registration number 02647645 (England and Wales) Annual report 2024-25 23
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2025 2025 2024 Notss Cash flows from operating activities Cash generated from operations 20 65,480 175,809 Investing a¢tivities Purchase of tangible fixed assets Investment income received (130.059) 9,159 (207.227) 5,426 Net cash used in Investing activities {120,900) (201,801) Net ¢ash generated from financing activities Net decrease In cash and cash equivalents (55,420) (25,992) Cash and cash equivalents al beginning ofyear 1,244,462 1,270,454 Cash and cash equivalents at end of year 1,189.042 1,244,462 Annual report 2024-25 24
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025 Accounting policies The principal accounling policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows.. Charity inforniation Stepping Stone Proje¢ts is a private company limited by guarantee incorporated in England and Wales. The registered office is The Quadrant, Green Lane, Heywood, Rochdale. OL10 1 NG. In the event ofthe charity being wound up, the liability in respect of the guarantee is limited to £1 per member of the charity. 1.1 Accounting conventlon The financial statements have been prepared in accordance with the charity's governing document, the Companies Act 2006. FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Charities SORP"Accounling and Reporting by Charilies.. Statement of Recommended Practice applicableto charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" The charity is a Public Benefit Entity as defined by FRS 102. Stepping Stone Projects meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised al historical cost or transaction value unless otheiSe stated in the relevant accounting policy note. The financial statements are prepared in sterling. which is the functional currency of Ihe charity. Monetary amounts in these financial stalements are rounded to the nearest £. The financial statements have been prepared under the historical cost convention. The principal a¢¢ounling policies adopted are set out below. 1.2 Golng concern At the time of approving the financial statements. the trustees have a reasonable expectation that the charity has adequate reSoUrS to continue in operational existence for the foreseeable future. Thus the trustees continue to adopt the going concern basis of accounting in preparing the financial statements. 1.3 Charitable funds Unrestricted funds comprise accumulated surpluses and deficits on general funds that are available for use al the discretion of the trusteesldirectors in furtherance of the general objectives of the Charity and that have not been designated for other purposes. Designated funds comprise unreslri¢ted funds that have been put aside at the discretion of the trusteesl directors for particular purposes. Restricted funds can only be used for particular restricted purposes within the objects of the charity. Restrictions arise when specified by the donor or when funds are raised for particular restricted purposes. 1.4 Income Income from charitable activities including income received under contract or where entitlement to grant funding is subject to specific performance conditions is recognised as eamed (as the related services are provided). Grant income included in this category provides funding lo support activities and is recognised where there is enlitlement, Gertainty of receipt and Ihe amount can be measured with sufficient reliability. Deferred income refers to the payments received by in advance for ServIS thal have not been delivered to the end user as at the year end. Annual report 2024-25 25
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 Accounting policies {Continued) Rent is recognised on a receivable basis. Investment income is recognised on a receivable basis. 1.5 Expenditure Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third paty, il is probable that a transfer of economic beneffts will be required in settlement, and the amount of the obligation can be measured reliably. Charitable expenditure comprises those costs incurred by the charity in the delivery of its seNices for its beneficiaries. It includes both those costs thal can be allocated directly to such activities and those of an indirect nature necessary lo support them. Expenditure is allocated between the restricted and unrestricted projectslfunds in accordance with contractual obligations or as the Board of Trustees considers appropriate. Governan costs include those costs associated with meeting the conslitutional and statutory requirements of the charity and indude the audil fees and costs linked to the strategic management of the charity. Support costs include central functions and have been allocated to charitsble adivities on a basis consistenl with the use of resources eg. Staff costs by time spent. 1.6 Tangible fixed assets Tangible fixed assels are initially measured at cost and subsequently measured al cost or valuation, net of depreciation and any impairment losses. Depreaation is recognised so as to write off the cost or valuation of assets less Iheir residual values over their useful lives on the following bases.. Leasehold land and buildings Rented propety improvements offi furniture and equipment Fixtures and fittings Computers 50 years 4 or 5 years 2 years 2 years 3 years The gain or loss arising on Ihe disposal of an asset is determined as the differen between the sale proc&eds and the carying value of the asset. and is recognised in the statement of financial activities. 1.7 Impairment of fixed assets At each reporting end date, the Gharity reviews the carrying amounts of its tangible assets to detemiine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (rf any). 1.8 Cash and cash equivalents Cash and cash equivalents include cash in hand, deposits held at call with banks, Other short-term liquid investmenls with original maturrties of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities. Annual report 2024-25 26
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 Accounting policies (Continued) 1.9 Financial instruments The charity has elected to apply the provisions of Section 11 'Basic Financial Instruments, and Section 12 'Other Financial Instruments Issues, of FRS 102 to all of its financial instruments. Financial instruments are recognised in the charity's balance sheet when the charity becomes party to the contractual provisions of the instrument. Financial assets and liabilities are offset. with the net amounts presented in Ihe financial statements. when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously. Basic financial assets The charity has financial assels and liabilities of a kind Ihat qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at amortised cosl. Basic financial liabilities Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the aangement constitutes a financing transaction. where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. Trade credilors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not. they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised st using the effective interest method. Derecognition of financial liabilities Financial liabilities are derecognised when the charity's contractual obligations expire or are discharged or cancelled. 1.10 Taxation The company is a registered charity and as such is entitled to exemption from tax to the extent that its income falls within section 505 ICTA 1988 and section 256 CGTA 1992 and is applicable to tharitable purposes only. 1.11 Employee benefits The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received. Temiination benefits are recognised immediately as an expense when the charity is demonstrably committed to terminate the employment of an employee or to provide termination benefits. 1.12 Retirement benefits Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. 1.13 Op8ratlng Leases Rentals payable under operating leases, including any lease incentives received, are charged as an expense on a straight line basis over the temi of the relevant lease. Annual report 2024-25 27
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 Accountlng policies (Continued) 1.14 Pensions Contributions in respect of the company's defined contribution pension schemes are charged in the year in which they are payable to the scheme. Critical accounting estimates and judgements In the application of the charity's accounting policies, the trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are nol readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods. Income from charitable activities Unrestrlctsd Unrestrlcted funds funds 2025 2024 Accommodatlon and support Grants received regarding accomodation and support Rent re1vable 6.085,420 8,314.548 7,164,051 4.719.311 14,399,968 11,883,362 Income from investments Unrestricted Unrestricted funds 2025 funds 2024 Bank deposit inlerest 9,159 5,426 other Income Unrestricted Unrestricted funds 2025 funds 2024 Other income and donations 49,340 16,210 Annual report 2024-25 28
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 Expenditure on charitable activities Accommodation Accommodation and support and support 2025 2024 Direct costs Staff costs Depreciation and impaimient Housing costs Housing management services Travel and training offi costs Recruitment 4.135,411 70,346 2,631,741 5,262,515 120,815 25,652 51,767 3,551.952 43.336 1.867,944 4.366.791 117,861 27,392 34.199 12,298,247 10,009,475 Share of support and governance costs (see note 7) Support Governance 1,771,114 30,878 1,725,836 28,505 14,100,239 11,763,816 Analysis by fund Unrestricted funds 14.100,239 11,763,816 Support costs allocated to activities 2025 2024 Staff costs Depreciation Office Costs Legal & professional Bank charges & interest Governan costs 1.191.371 122,797 428.209 19,608 9,129 30.878 1,180,407 119,340 389,121 31,572 5,396 28,505 1,801,992 1,754.341 Analysed between: Accommodation and support 1,801,992 1,754,341 Annual report 2024-25 29
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 Support costs allocated to activities {Continuedl 2025 2024 Governance costs comprise: Staff costs Depreciation Audit fees Legal and professional Office costs Bank charges & interest 21,244 177 8.500 28 899 30 19,144 198 8,000 52 1,081 30 30.878 28,505 Net movement in funds 2025 2024 The net movement in funds is stated after chargingl{creditingl'. Fees payable for the audit of the charity's financial statements Depreciation of owned tangible fixed assets Operating lease charges 8,500 193,320 3,465,587 8,000 162,874 2,828,287 Trusteos None of Ihe trust&es (or any persons connected with them) received any remuneration or benefits from the charity during the year. 10 Employees The average monthly number of employees during the year was.. 171 2025 Number 2024 Number Charitable activities Governan¢e 166 143 Total 171 148 Employment Costs 2025 2024 Wages and salaries Social security costs Other pension costs 4,692,402 430,773 224,851 4,181,91Q 374.38S 195,204 5,348,026 4.751,503 Annual report 2024-25 30
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 10 Employees (Continued) The number of employees whose annual remuneration was more than £60,000 is as follows: 2025 Number 2024 Number £60,001-£70,000 £70,001-£80,000 £90.001-£100.000 Rèmuneratlon of key management pèrsonnel The remuneration of key management personnel was as follows.. Thé key management personnel ofthe charity comprise the trustees and the Senior Management Team. The total employee benefits of the key management personnel of the charity were £495,394 (2024 = £316,511) 11 Taxation The charity is exempl from taxation on its a1VitieS because all ils income is applied for charitable purposes. 12 Tangible fixed assets Leasehold Rented Offlco Flxtur•s and land and property furnlturn and flttlngs bulldlngs Improvomants •qulpmont Computors Totsl Cost At 1 April 2024 Additions 707,081 328.184 36,504 201,862 4,301 588.108 19,305 608.342 2,433,577 69,949 130,059 At 31 March 2025 707,081 364.688 206,163 607.413 678.291 2.563.636 Depreciation and impairnient At 1 April 2024 Depreciation charged in the year 85,385 178.730 189,347 554.169 446.734 1,454.365 9.856 40,703 12,402 23.161 107.198 193.320 At 31 March 2025 95,241 219,433 201,749 577,330 553,932 1,647,685 Carrylng amount At 31 March 2025 611,840 145,255 4,414 30,083 124,359 915,951 At 31 March 2024 621,696 149.454 12,515 33,939 161,608 979,212 Annual report 2024-25 31
N07ES TO 7HEHNANaAL STA7EMENTS (CON71NUED) FOR 7HE YEAR ENDED 31 MARCH 2025 12 Tangible fixed assets (Continued) Leasehold property comprises 4 terraced properties purchased from Pendle Borough Council in 2011 for use by the Careleavers Project. The properties were acquired subject to the following restrictive covenants: 1) to use the properties solely for the purpose of supported residential housing for a period of 10years', 2) not to dispose of any of the properties without the written permission of Pendle Borough Council. In addition to the above a property known as St Clare's House in Rochdale was purchased in May 2019. and is operaled by Ihe charity as a House of Mulliple Occupation {HMOI. 13 Debtor8 2025 2024 Amounts falling due within one year: Trade debtors Other debtors Prepayments and accrued income 1,499,726 482.358 408,830 261,868 614,113 820,883 2,390,914 1,696,864 14 Credltors: amounts falling due within one year 2025 2024 Notss Other taxation and social security Deferred income Trade creditors Other creditors Accruals 111,447 143,152 356,626 28.848 85,975 98.539 11,907 312,058 18,961 67,442 16 726.048 508,907 15 Operating lease commltments The charitable company rents its head office accommodation at a cost of £34,500 (2024 .' £34.500) per annum, under a lease for a term of ten years expiring 31.08.32. The charitsble company also has commitm&nts under management agreements of up to three years duration with Housing Associations and private landlords for the use of properties. Most agreements with private landlords are for periods of six months. The annual commitment for management and occupancy costs as at 31st March 2025 was £4,673,648 {2024 . £3,942,832). 16 Deferred income 2025 2024 Other deferred income 143,152 11,7 Deferred income is included in the financial statements as follows.. Annual report 2024-25 32
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 16 Deferred income (Continued) 2025 2024 Deferred income is included within.. Current liabilities 143,152 11,907 Movemènts in the year.. Deferred income at 1 April 2024 Released from previous periods Resources deferred in the year 11.907 {11.907) 143,152 71,143 (71,143} 11,907 Deferred income at 31 March 2025 143,152 11,907 Contractual income has been deferred as it was received in advance of services being provided. 17 Retirement beneflt schemes 2025 2024 Defined Contrlbutlon schemes Charge to profit or loss in respect of defined contribution schemes 224.851 195.204 The charity operates a defined contribution pension scheme for all qualrfying employees. The assets of the schemes are held separately from those of the company in independently administered funds. The annual commitment under this scheme is for contributions of £224.851 (2024 £195.2041. 18 Unrestrlcted funds Designated funds are rent and seNice charge receipts set aside for future refurbishment of the housing properties ulilised by the charity. The Trustees are ol ihe opinion that the amount set aside as at 31 March 2025 is sufficient to cover requirements in the short term. At 1 April 2024 Incoming resources Resources expended Transfers At 31 Mah 2025 Dilapidations Fixed assets General fvnds 349,585 979.212 2,082,834 754,606 (407,455) (111,212) (63,261) 174,473 585,524 915,951 2,268,384 13,703,861 (13,692,784) 3,411,631 14,458,467 (14,100,239) 3,769,859 Annual report 2024-25 33
NOTES TO THE FINANCIAL STA TEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025 18 Unrestricted funds (Continued) Previous year: At 1 April 2023 Incoming resources Resources expended Transfers At 31 March 2024 Dilapidations Fixed assets General funds 341.843 564,487 (401,691) (155,054) 979,212 {824.1581 349,585 979,212 2,082,834 2,928,606 11,340,511 (11.362.125) 3.270.449 11,904.998 (11.763.816) 3,411,631 Designated funds consist of.. 1. Dilapidations Fund is made of rent and setvice charge receipts sel aside for future refurbishmenl of the housing properties utilised by Ihe charity. The Trustees are of the opinion that the amount set aside as at 31 March 2025 is sufficient to cover requirements in the short term. 2. Fixed Assets Fund represents the properties and other fixed assets such as office fumiture, computer equipment and furniture provided in our properties 19 Related party transactions There We no disclosable related party transaclions during the year {2024 - none). No trustee or other person related to the charity had any personal interest in any contract or Iransaction entered into by the charity during this or the previous financial year. In the opinion of the trustees there is no ultimate controlling party. 20 Cash generated from operatlons 2025 2024 Surplus for the year 358.228 141,182 Adjustments for: Investment income recognised in statement of financial activities Depreciation and impaimient of tangible fixed assets 19,159) 193.320 (5,426) 162,874 Movements in working capitsl: (Increase) in debtors Increase in creditors Increasel(decrease) in deferred income (694,050) 85.896 131,245 (93,750) 30,165 (59,236) Cash generated from operations 65,480 175.809 21 Analysis of ¢hange$ in net funds The charity had no material debt during the year. Annual report 2024-25 34
Annual Report 2024-25 Celebrating 40 Years with Purpose and Vision Thank You Stepping Stone Projects 2 The Quadrant, Green Lane, Heywood, OL10 1 NG L 01706 353000 www.stepping-stone.org.uk