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2023-03-31-accounts

Company Number: 02814177 Charity Number: 1038862

Report and Financial Statements for the year ended 31 March 2023

Annual Report & Financial Statements 2022-23

Contents

For the year ended 31 March 2023

Reference and administrative information ........................................................................................................ 1 Chair’s report .................................................................................................................................................... 3 Chief Executive’s review .................................................................................................................................... 6 Trustees’ annual report ..................................................................................................................................... 9 Independent auditor’s report ......................................................................................................................... 23 Statement of financial activities (incorporating an income and expenditure account) ...................................... 27 Balance sheet ............................................................................................................................................... 28 Statement of cash flows ................................................................................................................................. 29 Notes to the financial statements .................................................................................................................. 30

Annual Report & Financial Statements 2022-23

Reference and administrative information

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For the year ended 31 March 2023

Company number 02814177 Country of incorporation United Kingdom Charity number 1038862 Country of registration England & Wales

Registered office and operational address Registered office and operational address 5 Church Green
Atherstone on Stour
Stratford upon Avon
Warwickshire
CV37 8NE
Trustees Trustees, who are also directors under company law, who served during the
year and up to the date of this report were as follows:
Robert Pearce Chair
Margaret Harrison Vice Chair / Hon Treasurer
Jane Reed
Richard Lane Vice Chair
Francis Sprules
Kathryn Stevens
Amy Batchelor (resigned 01.06.2022)
Katherine Barber
Gurjit Bhogal (resigned 28.02.2023)
Susan Johnson-Gregory
(appointed 16.11.2022)
Janinah McKenzie (appointed 01.09.2022)
Key Helena Wallis Chief Executive
management Edd Terrey Director of Operations (left 07.02.2023)
personnel Rebecca Davies Commercial Director
Bankers Santander
21 Wood Street, Stratford-upon-Avon
Warks CV37 6JU
Solicitors Anthony Collins Solicitors LLP
134 Edmund Street
Birmingham B3 2ES
Fund Managers Rathbone Investment Management
20 Colmore Circus Queensway
Birmingham, B4 6AT
CCLA Investment Management
85 Queen Victoria Street
London, EC4V 4ET

Annual Report & Financial Statements 2022-23

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For the year ended 31 March 2023

Investment First Actuarial LLP advisors Mayesbrook House Redvers Close Leeds, LS16 6QY Auditor Sayer Vincent LLP Chartered Accountants and Statutory Auditor Invicta House 108-114 Golden Lane LONDON, EC1Y 0TL

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Chair’s report

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For the year ended 31 March 2023

CHAIR’S REPORT

We continue to remain focused on the delivery of our organisational strategic intentions, which has meant the ongoing need to steer the organisation through continued challenges and uncertainty linked to the post-pandemic impact and funding issues that the Third Sector faces. However, I am delighted and proud to say that, Heart of England Mencap continues to deliver a progressive, solution based and aspirational strategy, that identifies opportunities for growth in our service offer and which continues to put the people we support at the heart of everything we do.

Our ability to remain adaptable, responsive, agile and creative is key to staying focused on our objectives and business plans and as a result, this has enabled us to achieve the outcomes we had planned to deliver and to continue to build on our existing strengths. Much of this is down to the people within the organisation and the passion that drives them to ensure we deliver professional care and support services that we can all be proud of.

As a Board of trustees and Directors we are collectively committed to ensuring we spend time visiting services to understand the challenges faced by our care workforce and to see the impact of what we do on people’s lives. This provides an ideal opportunity to receive feedback directly from our workforce and connect with the people we support. This has been a key factor in influencing our review of achievements and in our planning for future services. All the trustees feel this connection to the people we support is critical to our leadership role in the organisation.

As part of our strategic objectives we have continued to include the need to ensure the voice of the people we support contributes to our plans and I am delighted to see the development of opportunities to encourage this through the customer co-production work we have done with the Reach Out Group . This has provided increased opportunities for improving engagement with the people that choose Heart of England Mencap as their service provider, providing opportunities to influence the local and national agenda for people with a learning disability and to facilitate direct engagement between the Board and the customer representative group. The work on co-production and involvement will continue as a key theme in our strategic direction in the future.

Our aspiration to ensure the people we support, and all people with a disability, live a fulfilling and meaningful life remains at the heart of everything we do. Whilst we acknowledge new approaches to the way health and social care are aiming to become more ‘aligned’, through the development of the Integrated Care Boards – in reality, it is still early days and the way that services are commissioned and funded requires us to influence where we can, with the right partners and to continue to navigate through the complex organisational structures that exist across health and social care. We advocate accessibility, inclusion, involvement and enabling people with a learning disability to have equal opportunity to access the right support to keep them in the best of health.

The post-pandemic recovery has continued to impact upon the health and care sector and this has made many people involved in care feel they have been ‘forgotten’. Whilst the population went back to relative normality, things were slow to change in the health and social care sector, for example, the ongoing requirement for infection prevention and control protocols requiring staff to continue to have to wear face masks, when much of the world had been able to remove these. The ongoing need to test and isolate in the case of a positive test for Covid-19 meant people had to take sick leave, even though they didn’t feel unwell. All these actions reinforced the view of the care sector isn’t valued and continues to

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For the year ended 31 March 2023

be a the poor relative of the health and care system. Despite all this we have continued to aspire to provide more opportunities across all our services, keep a focus on continuous improvements and consider how we support our workforce during these difficult times.

The Trustee Board has continued to invest time in our non-executive responsibilities for leading the organisation, dedicating time to review our strategic aims and objectives, with ongoing regular governance meetings, and time allocated to ensure the sustainability of our services. A key feature of these meetings has been the opportunity to reflect, learn, review and plan.

The ongoing development of our digital capabilities is a key are of focus in terms of organisational development and despite some early challenges, the momentum has continued and we are now back on track to deliver against our project timescales and business plans. We see this as a key culture change requirement for the organisation and our approach to care and as such recognise the need to invest in the appropriate support, expertise and skills to enable us to deliver this during the coming 1224 months.

A significant organisation change will be taking place during the next financial year, as our current Chief Executive, Helena, has announced her retirement after a period of over 10 years providing significant leadership and direction, through some challenging times. Helena will continue to work until the end of August 2023 and during her notice period we will be actively recruiting for her successor. I would like to take this opportunity to thank Helena for her inspiration, dedication and resilience, she has worked very hard and the organisation has benefitted immensely from her tenure as CEO.

I know that Helena is proud to have in place a knowledgeable and empowered team that are commitment to continuing the journey with us and to deliver on their objectives. We will ensure they are supported to achieve their individual and collective goals and aspirations during this period of leadership change. The Executive team includes Becky Davies, our Commercial Director; Becky has also been instrumental in supporting the delivery of our key strategic objectives and she will continue to provide continuity to our remaining senior leadership team. I am proud how the Executive team have continued to lead, adapt, and respond effectively to the challenges and changes in the environment in which we operate. Their commitment and dedication have been outstanding, often requiring tenacity and dedication to navigate the complex systems that exist across health and social care funders to ensure that the people we support receive the care they require to enable them to live their most fulfilling lives.

I would like to extend my thanks to all my fellow Trustees who have served on the Board or who have joined us during this year. Their commitment, dedication, and passion enables us to work collectively and collaboratively to achieve our business objectives and our charitable aims.

My continued thanks go to the many fabulous, dedicated teams and individuals that continue to provide our professional care services, their ongoing commitment and belief in enabling the people they support to have their best lives possible continues to be at the heart of everything we do.

Together we celebrate what we all do in paying attention to ensuring that we deliver the best possible services for our customers.

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Chair’s report

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For the year ended 31 March 2023

Robert Pearce

Chair

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Chief Executive’s review

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For the year ended 31 March 2023

Chief Executive’s Review

Throughout this year we have continued to focus on delivering our objectives and ensuring our overall mission is achieved and the people we support are at the heart of everything we do. I am proud with our achievements, despite the continuing challenges of operating in a post-pandemic environment, alongside the funding challenges we continue to face. In reality post-pandemic ‘recovery’ feels to have taken longer in the social care sector and I am sure the impact of this will be felt across the sector for many years to come.

Reflecting on this year’s achievements and performance, I am delighted to say we have continued to ensure all our regulated services have a GOOD rating from CQC. Services that are not overseen by the regulator continue to be delivered to a good standard and we have had positive feedback from our local authority contract monitoring teams.

Of note this year was the re-commissioning for all our framework services across our main funder, Warwickshire County Council, which required us to decide which contracts we would re-tender for and carry out significant work to complete this within the allocated timeframes. The outcome of this is that we have secured all our existing services for the coming 5 years, with the ability for a 2 year extension. This ensures we have a sustainable business model on which to continue to grow and develop.

The ongoing challenges facing providers in terms of workforce availability is a continued area of risk as the battle for good resources is not just between providers in the care sector, but now competition exists across wider industry groups, such as retail, travel and tourism. We know that the inequalities that exist between the health sector remuneration levels is another area of disparity and we need to continue to aim for equal recognition of the value of the roles in the care sector in line with those in the health sector.

Our strategy continues to focus on the key themes identified in 2021 and each year we review our business plan actions that will enable us to deliver this. This underpins our approach to everything we do and we continue to share this with our team members and colleagues to ensure they see continuity in our aims and objectives. Along with the annual Budget review process that supports our financial performance and supports sustainability, this will allow us to continue to be responsive to the needs of the people we support today and consider the business opportunities for the future.

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Chief Executive’s review

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For the year ended 31 March 2023

A key area of investment during this year and the following year will be supporting our teams and individuals through a change management programme, which is linked to new ways of working and the development of our digital capabilities. During the year we started on a journey to work with a new Care Management System, however as time progressed we felt we were not getting to where we expected to be. As a result of this we took the brave step to stop and reflect and determine a much clearer way forward. The outcome of this was that we went back to the initial project requirements, restated these and set up a clear project outline that we could all be held accountable to. We are now back on track with our delivery plan and have re-selected a new CMS partner, Birdie, to work with. With this enhanced focus on digital operations, we have continued to review the security of our digital assets, including information and data, and following the successful accreditation with Cyber Essentials, we aim to pursue addition recognition of Cyber Essentials Plus. This will ensure we remain in line with best practices around information and systems management in the care sector.

As this is my last full financial year as Chief Executive for Heart of England Mencap, the overriding message I’d like to give is one of immense pride in everything we do and have achieved this year and during my time as CEO. I’d like to recognise and acknowledge the endless passion, commitment and tenacity of the teams and individuals across all the services we provide. We have kept the focus on achieving our mission a key driver for change and a catalyst to influence the stakeholders and systems we work with both at local and national levels. All the senor leadership team have been instrumental in achieving positive outcomes for the people we support, through determination, drive and commitment. I know the organisation is in a secure position to continue to focus on delivering exceptional care and support that is consistent across all our services and to achieve our growth aspirations for the future and ultimately enabling more people with a learning disability to live their best and most meaningful life.

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For the year ended 31 March 2023

Helena Wallis

Chief Executive

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Trustees’ annual report

For the year ended 31 March 2023

The trustees present their report and the audited financial statements for the year ended 31 March 2023.

Reference and administrative information set out on page 1 forms part of this report. The financial statements comply with current statutory requirements, the memorandum and articles of association, the requirements of a directors’ report as required under company law, and the Statement of Recommended Practice - Accounting and Reporting by Charities: SORP applicable to charities preparing their accounts in accordance with FRS 102.

Objectives and activities

Purposes and aims

The purpose of the charity is to empower people with a learning disability to live fulfilling lives.

We deliver a wide range of support, enabling individuals to live independently within their own home or with support that is tailored to meet their needs.

We find the appropriate ways to support people to live the life they choose focusing on what an individual can do rather than their disability.

Our range of services includes supporting people to live independently within their own home or one of our homes or enabling them to access meaningful support through day activities. We encourage our customers to further enrich their lives through education, life skills, leisure and a range of social activities.

We offer valuable respite and short break services, enabling individuals to have some time away from home - perhaps just as a respite visit, a short holiday, or as a first step in learning how to live a more independent life.

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Trustees’ annual report

For the year ended 31 March 2023

Our approach is to provide the right support in the right setting - ensuring customer safety and security, as well as encouraging customers to develop independent living skills and lead an active social life, with the reassurance of highly sensitive and person-centred support always being available when it’s needed, under a variety of commissioning frameworks, offering purposeful activity to support customers’ identified outcomes.

Public benefit

Local Government has certain responsibilities towards people with a learning disability and other vulnerable groups under the Care Act 2014 and other legislation and in some cases chooses to commission these services to specialist providers under contractual frameworks, which we are awarded. The trustees operate the charity within this external marketplace and provide a specialist third party source of care and support for those individuals, their families, dependents and carers, who are affected by a learning disability and/or autism. The public interest is served best when sufficient numbers of providers are willing to offer services to a good standard - this improves the quality of the care provided and helps to manage costs for the public purse.

The trustees review the aims, objectives and activities of the charity each year. This report looks at what the charity has achieved and the outcomes of its work in the reporting period. The trustees report the success of each key activity and the benefits the charity has brought to those groups of people that it is set up to help. The review also helps the trustees ensure the charity's aims, objectives and activities remained focused on its stated purposes.

The trustees have referred to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the charity's aims and objectives and in planning its future activities. In particular, the trustees consider how planned activities will contribute to the aims and objectives that have been set.

The trustees considered the issue of public benefit when looking strategically at the range of support services offered and continue to be committed to the charity being a specialist learning disability provider as they believe that this is the best way for it to fulfil its core objective.

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Trustees’ annual report

For the year ended 31 March 2023

Activities and services

The charity operates various services, 24 hours per day, 365 days per year for the benefit of individuals with a learning disability. Its services are practical, outcomes-focused and designed to be purposeful and to provide support, encouraging independence and autonomy. The charity helps people to live their lives as adults, living in their own accommodation where that suits the individual and their family; underpinning the care provided by carers in the family home with skilled respite provision. During the day, there is a range of community-based daytime options to suit a wide range of abilities and needs.

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62
56
1
people accessing
Supported Living
care home community day
customers services
(3 residential
places)
30
5,400
people accessing
respite beds per
dedicated complex
annum
needs care
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Our Values

Underpinning all our ways of working is our commitment to demonstrating our values through everything we do. We take our responsibilities as an employer very seriously and we are proud to be recognised as an Investor in People. Through training and regular team meetings, every effort is made to enhance the value of the role employees carry out in the eyes of customers, colleagues, commissioners and the wider public.

A lot of work has been done, and continues to be done, to embed our values across all services and at all levels of the organisation.

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Trustees’ annual report

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Achievements and performance

The charity's main activities and the people it aims to help are described above. All its charitable activities focus on the provision of care and support to people with a learning disability and are undertaken to further Heart of England Mencap’s charitable purposes for the public benefit.

Throughout the year, the continued ramifications of the pandemic have required all of our teams to manage and respond to the challenges. One of the key areas has been the ongoing impact on our workforce availability and on our recruitment and retention. The operational managers and care teams have continued to work flexibly and respond with passion and dedication to the people we support.

Since the Covid-19 restrictions were lifted, some services have continued to have a slow recovery to ‘normal capacity’, specifically, our respite services. There has been an understandable reluctance for some families to return to life before Covid-19, especially when so many of the people we support are likely to have underlying health conditions that could put them at more risk if they were infected. We have continued to follow all local guidance on managing local infection outbreaks. However, the impact of this is seen in our revenue as our commissioning partners no longer provided funding when services were closed, unlike during the first year of the pandemic. We have retained a strong focus on infection prevention and control and have successfully managed to do this at a time when risks increased after lockdown ended.

There have been several key achievements during the year – the key areas that we are proud of are:

During the year we took time to review our digital transformation project which was underway with the intention of moving our care management system from a paper-based system to a digital solution with Unique:IQ. As part of this reflection process we also looked at other providers within the market to ensure our needs were most effectively met.

Given the developments by other software providers it was felt that other solutions were more suited to the needs of the whole organisation. Our selected partner, Birdie, will allow us to electronically monitor the remote care workforce, providing real-time information such as triggering alerts if support workers are late or miss a shift. It offers two-way dialogue features to make communication easy, provides electronic medication management systems (eMAR), and activity logs. This system should eliminate

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many of the paper-based manual systems, which often result in duplication and can result in errors. The system will be the key tool to support our workforce scheduling and rostering of care visits, producing digital care plans and maintaining service user records.

Our focus on people and rewards has continued, and we have again invested time and resources in the way we engage with and reward our workforce. Many of the actions we have taken have been because of the feedback from the Investors in People assessment and include:

Some of the specific actions that support these themes have included:

The customer co-production team, Reach Out Group have continued throughout the year with their work and attended Board meetings as well as working with senior leaders to help shape our strategy and operational objectives. We were supported in the development of this group with a grant we were successful in securing from The Royal Mencap Society. This provided us with the funding, over a 2-year period, to enable us to enhance our community connections and extend our reach to a wider range of people that need support.

We recognise and value the many groups and individuals that have contributed to and enabled our progress. Without this support, we couldn’t have achieved the significant progress we have made, and we would like to take the opportunity to thank a number of local and national partners for their significant contribution to the work of Heart of England Mencap, including: The Royal Mencap Society, Association for Real Change (ARC), National Council of Voluntary Organisations, Stratford Town Trust, Warwick University, The Ann Craft Trust, NCVO, Risk Evolves, SCCS, Birdie, Acutec, Pink Connect, My Learning Cloud, Restraint Reduction Network.

We have continued to ensure our services are sustainable and that our financial performance is monitored with rigour and objectivity, at the same time balancing this with the external funding pressures and pursuing our charitable aims.

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Trustees’ annual report

For the year ended 31 March 2023

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210
Employees
(2023)
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197
Employees
(2022)
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As an organisation, the charity takes its responsibilities as an employer very seriously and it is proud to be recognised as an Investor in People. Through training and regular team meetings, every effort is made to enhance the value of the role its employees carry out in the eyes of customers, colleagues, commissioners and the wider public. A lot of work has been done and continues to be done to embed the values across all services and all levels of the organisation.

Beneficiaries of our services

As outlined above, Heart of England Mencap provides care and support in a variety of ways to people living with a learning disability, their families and carers. Due to the Covid-19 situation our teams have had to continue to adapt to new ways of working ensuring our customers still received person-centred care and meaningful support. At the heart of everything we do is the people we support and the teams that have continued to deliver with commitment and dedication!

Financial review

The loss of income over expenditure for the year, before revaluation gains and losses, is £206,295 compared with a loss of £42,230 for the year ended 31 March 2022.

Operational income increased by 6.1% (2022: 2.0%). Various opportunities were identified to increase the number of people we could accommodate safely and new customers were found to make use of the additional space. Central function costs were minimised wherever possible. The unrestricted loss (before gains/losses on investments) was £198,556 (2022: £42,368).

The graph below summarises the way the income mix has shifted over the past few years.

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Trustees’ annual report

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In the prior year the charity received £148,706 of various infection control grants from the Local Authority. An administration error within the Local Authority resulted in an overpayment of £97,000 of the Workforce Recruitment and Retention Fund. Due to expenditure timescales and restrictions, we had already allocated and paid this expenditure in the form of a retention bonus across all employees. Once the Local Authority notified us we took legal advice and were required to repay the £97,000 and full settlement was made in March 2022.

In early 2021 a customer of Heart of England Mencap, sadly died and as the beneficiary of a fund in her mother’s will, which was left in trust, Heart of England Mencap was the beneficiary of the residual fund. The general restrictions stated in the will identified that the funds should be used towards projects that benefit services delivered in Stratford upon Avon, without specifically stating any binding limitations or obligations.

The charity holds investments in two COIF Charity Funds, with CCLA Investment Management, known as the Edith Rose Trust. The funds were left to the charity with the restriction that the income should be used for the welfare and amenity of customers. The trustees’ policy is to invest the funds with a recognised charity fund manager and to seek a balance between risk management, capital maintenance and steady income. The funds achieved an income of 0.7% for the year (2022: 1.6%) which was used in full across the services.

The trustees have an investment policy which requires them to identify investment vehicles which offer a sensible balance between cost, return and volatility risk. They have also identified investment opportunities which are not congruent with the organisation’s values and therefore they will avoid vehicles with holdings in companies which:

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Trustees’ annual report

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Principal risks and uncertainties

Risk Mitigation
Safeguarding – a customer suffers
harm while in the care of the charity,
leading to reputational and/or
financial damage to the organisation		 ● a defined Designated Safeguarding Lead is identified
across all services and regular DSL Reviews are held
● all staff, including volunteers, receive appropriate
training
● there are robust procedures for supporting customers
appropriately
● all services are reviewed by an external organisation
who advise on improvements and better ways of working
● regular review of Health and Safety
● whistleblowing policy in place
● Safeguarding is a standing agenda item on Board
Agendas- decisions are recorded
Financial – the organisation faces
unmanageable financial demands
that mean it is unable to continue as
a going concern		 ● the organisation reports its financial results regularly,
investigates variances from plan and implements
mitigating actions
● the organisation maintains close links with
commissioners, third-sector peers and advisers and
keeps in touch with announcements of changes that
could affect the organisation financially or operationally
● the organisation looks for new opportunities to reduce
reliability on one key funder
● financial changes are modelled into the forecasting tool
to assess their longer term impact
● there is a robust governance process in place to ensure
that trustees are informed promptly of any threats to the
sustainabilityof the charity
Regulatory – the organisation fails to
maintain good ratings across all
services		 ● the organisation has a strong operational leadership
team who are aware of the requirements and
regulations

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● The Nominated Individual role is recognised as a key
role and an external individual is appointed to ensure
transparencyand clear definitions of responsibilities.
People and Resources - the local area
has very low levels of unemployment
and recruitment presents a significant
challenge		 ● various initiatives are in place, including Refer a Friend
and Make it Meaningful to improve engagement,
enhance the value of Heart of England Mencap as an
employer and demonstrate that people’s efforts are
noted and appreciated
● Employee engagement activities including
communication initiatives, employee surveys and
opportunities for feedback support greater
collaboration and involvement in regular recruitment
campaigns and targeted initiatives are developed and
delivered

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Trustees’ annual report

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Reserves policy and going concern

The Society holds a General Reserve to provide for day-to-day working capital and for contingencies, including protection against a decline in income, which cannot be quickly matched by a reduction in expenditure.

The trustees consider that a General Reserve equivalent to three months’ expenditure (13 weeks’) is appropriate. The policy is reviewed by the Finance Committee following consideration of the Society’s financial results and other relevant factors and a recommendation is then put to the Board of Trustees for approval.

At 31 March 2023, the General Reserve was £1,056,375 (2022: £1,325,766), which represents around 10 weeks’ expenditure (2022: 13 weeks’). The trustees have a target of 13 week’s expenditure as an appropriate level of reserves. In January 2022 we purchased a property – 59 Chichester Lane, Hampton Magna - which was a cash purchase using our existing reserves balance exceeding our policy. We are conscious that the current holding is under the 13 weeks’ target. The Executive team and Trustees continue to focus on the growth of the organisation and to achieve a surplus in future financial years to rebuild the reserves to the levels felt appropriate.

At 31 March 2023, the restricted net current assets were £126,394 (2022: £125,493). These funds are restricted and not available for general purposes.

The trustees continue to review progress against budget, their cash flow forecasts and borrowing plans. The trustees recognise that there will have to be changes in the way that some services are delivered in the medium term and that this will influence the contributions which can be achieved from the various services. Although there will almost certainly be services which cannot continue, the trustees believe that there are opportunities to reshape services and for the teams to introduce creative new solutions to satisfy the needs of customers and they have therefore concluded that it is reasonable to consider that the charity continues to be a going concern.

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Trustees’ annual report

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Plans for the future

The priorities for 2023/24 are:

In addition, the charity will work to develop stronger relationships with Commissioners and other third sector providers to explore whether opportunities exist to expand its services more widely, extend opportunities for collaboration and develop new approaches to care.

Structure, governance and management

The organisation is a charitable company limited by guarantee, incorporated in England on 30 April 1993 and registered as a charity on 27 June 1994. Day to day responsibility for its operational management is delegated to the Chief Executive Officer and through her to the Executive Team, who report on progress towards agreed objectives regularly to the Board of Trustees and its sub-committees.

The company was established under a memorandum of association which established the objects and powers of the charitable company and is governed under its articles of association.

All trustees give their time voluntarily and receive no benefits from the charity. Any expenses reclaimed from the charity are set out in note 9 to the accounts.

Appointment of trustees

Trustee vacancies are advertised as widely as possible, making use of free opportunities to publicise the fact that new talent is being sought and specifying any particular skills or qualifications required. In the first instance, respondents meet with the Chief Executive Officer who assesses their application for suitability and subsequently, candidates are invited to meet the Chair and to a more formal panel

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interview with other trustees. Throughout the trustee recruitment process we apply the principles of diversity, equity and inclusion to enable us to attract candidates from all community groups.

New trustee induction and training

New trustees are provided with a copy of the memorandum and articles of association and are encouraged to spend time with the Executive Team and out in the services to get a good understanding of the work done by the charity and the internal processes and controls in place. Strategy days are held from time to time to explore the trustees’ views and intentions for the future of the charity and where appropriate, key advisers are invited to meet the trustees to discuss major areas of risk management. For example, a meeting is being scheduled where the external reviewer will report back to trustees on the current effectiveness of the services and any proposed action points.

Trustees are required to undertake specific mandatory training, including Safeguarding and GDPR compliance. These are delivered either as attendance at a targeted programme for trustees or via our internal e-learning platform MyLearningCloud. Additional training and development is lso encouraged in line with individual needs and aspirations. .

Related parties and relationships with other organisations

Heart of England Mencap is affiliated to the Royal Mencap Society. There are no related parties or relationships with other organisations requiring disclosure.

Remuneration policy for key management personnel

The charity seeks to remunerate key management personnel fairly and in line with salaries paid by other similarly sized organisations in the area. The objective is to enable the charity to be able to recruit, retain and motivate its key staff in an area of very low unemployment, while having regard for the rates payable to support staff and the fact that the organisation is a charity.

Policy for employment of disabled persons

The charity’s policy is to hold all roles open to all applicants equally, having due regard to the health and safety of staff and customers. As a disability charity, it welcomes applications for available roles from disabled persons and actively looks for ways to accommodate disabilities. These have included: rejecting a possible alternative office location due to it being inaccessible; building ramps to facilitate movement between spaces on different levels; tailoring a role to suit the individual disability, including offering reduced hours. Were an employee to become disabled during the course of their employment, the same considerations would apply.

Employee information

Managers and Team Leaders meet regularly to be informed of any developments, to share best practice and to maintain strong relationships. Flowing out from these meetings, the Managers and Team Leaders hold meetings with their local teams to pass the information forward and gather feedback.

Most employees have a mobile phone as a key tool to manage their movements and record their time and attendance. The charity has a Yammer account to which people are signed up and notices and

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Trustees’ annual report

For the year ended 31 March 2023

snippets of information are disseminated through this route. Staff often share information between themselves and with Central Services via this route.

We have successfully implemented an electronic payslip process, providing information to them as soon as payroll is processed, enabling employees to access pay data on an ongoing basis, including records of P60s. This process has improved the speed of providing important information and has improved reliability of delivery.

Funds held as custodian trustee on behalf of others

The charity is running a pilot with Warwickshire County Council to test the new Individual Service Funds approach to service delivery. These funds are held in a separate bank account and clearly identified.

Fundraising Practices

The charity is registered with the Fundraising Regulator and the Institute of Fundraising and abides by its Code of Conduct. There have been no instances of non-compliance with the code.

The organisation no longer has a fundraising and grants department so applications for grant funding are made on a case by case basis when a need is identified which could be supported by external funding. The organisation also holds unrestricted money which has been raised by individuals who support the charity.

Local fundraising events and activities are managed and arranged by staff teams in the services to raise smaller amounts of money in the community. These events have been risk assessed centrally and everyone involved has been briefed on the behaviours expected and how to manage and safeguard any cash raised.

Employees are encouraged to sign up for the Amazon Smile scheme which donates for every Amazon purchase to the chosen charity of subscribers.

We don’t undertake any direct fundraising with the general public and no complaints have been received about the fundraising undertaken by Heart of England Mencap.

Statement of responsibilities of the trustees

The trustees (who are also directors of Heart of England Mencap for the purposes of company law) are responsible for preparing the trustees’ annual 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 charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

Annual Report & Financial Statements 2022-23

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Trustees’ annual report

For the year ended 31 March 2023

The trustees are responsible for keeping adequate accounting records that 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. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. In so far as the trustees are aware:

The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Members of the charity guarantee to contribute an amount not exceeding £1 to the assets of the charity in the event of winding up. The total number of such guarantees at 31 March 2023 was 58 (2022: 58). The trustees are members of the charity but this entitles them only to voting rights. The trustees have no beneficial interest in the charity.

Auditor

Sayer Vincent LLP was re-appointed as the charitable company’s auditor in an open tender process during the year and has expressed its willingness to continue in that capacity.

The trustees’ annual report has been prepared in accordance with the special provisions applicable to companies subject to the small companies’ regime.

The trustees’ annual report has been approved by the trustees on 29 August 2023 and signed on their behalf by

Helena Wallis Company Secretary

Annual Report & Financial Statements 2022-23

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Heart of England Mencap

Opinion

We have audited the financial statements of Heart of England Mencap (the ‘charitable company’) for the year ended 31 March 2023 which comprise the statement of financial activities, balance sheet, 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 United Kingdom Accounting Standards, including FRS 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 charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’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 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 Heart of England Mencap'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 other information comprises the information included in the trustees’ annual report other than the financial statements and our auditor’s 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, 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 course of the audit, or otherwise appears to be materially

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Heart of England Mencap

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.

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ annual 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:

Responsibilities of trustees

As explained more fully in the statement of trustees’ responsibilities set out in the trustees’ annual report, 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.

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

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Heart of England Mencap

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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud are set out below.

Capability of the audit in detecting irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud

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Heart of England Mencap

rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website atwww.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

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.

Fleur Holden (Senior statutory auditor) 21 September 2023

for and on behalf of Sayer Vincent LLP, Statutory Auditor Invicta House, 108-114 Golden Lane, LONDON, EC1Y 0TL

Annual Report & Financial Statements 2022-23

Heart of England Mencap Statement of flnanclal actlvltles lincorporatlng an income and expenditure account) For the ar ended 31 March 2023 2023 Total Unrestrlcted 2022 Total Unrestricted Restricted Restricted Note Income from.. Donations Charitable activities Residential care Short stay Domiciliary care and support Daytime activities Complex needs service Other trading activities Other income Investments 22,077 22.077 9,081 73,813 82,894 183,788 1,376,657 2,639,218 371,374 942,171 37,097 183.788 1.376.657 2.639.218 371.374 942.171 64.869 176,155 1,215,054 2,567,757 273,002 936,737 73,784 76,155 1,215,054 2,567,757 273,002 936,737 73,784 148,706 4,018 27,772 148,706 6,116 6.116 4,018 Total Income 5,578,497 27,772 5.606.269 5,255,587 222,519 5,478,107 Expendlture on.. Residential care Short stay Domiciliary care and support Daytime activities Complex needs service Exceptional items 199,298 ,232,010 2,845,188 442,976 1,057,582 199.298 1.234.501 2.864.596 456.587 1.057.582 166,052 1,129,981 2,659,824 353,110 931,233 57,756 5,084 37,257 73,287 19,230 37,681 49,842 71,136 1,167,238 2,733,111 372,340 968,914 107,598 2,491 19,409 Total expendlture 5,777,053 35,511 5.812.564 5,297,955 222,381 5,520,336 Nei lexpendlturel I Income before net Ilossesl I galns on Investments (Losses) I gains on revaluation of investment assets 1198,5561 17,7391 1206.2951 142,3681 138 142,2301 14,6161 19.7451 28,460 14,138 42,599 Net lexpendlturel I Income for the year 1203,1731 112,8671 1216.0401 113,9081 14,276 369 Transfers between funds 12,9761 2,976 Net movement In funds 1203,1731 112,8671 1216.0401 116,8841 17,252 369 Reconclllatlon of funds.. Total funds brought forward 2,803,253 300,886 3.104.140 2,820,137 283,633 3,103,771 Total funds carrled fotward 2,600,081 288,019 2.888.100 2,803,253 300,886 3,104,140 All of the above results are derived from continuing activities. There were no other reco9nised gains or losses other than those stated above. Movements 27

Heart of England Mencap Balance sheet Company no. 02814177 As at 3 1 March 2023 2023 2022 Note Fixed assets: Tangible as5et5 Inve5tment5 1.316,159 389,172 1.253,964 398,917 1.705,331 1.652,881 Current assets.. Debtors Cash at bank and in hand 1,024,675 523,792 784.559 1,144.721 1,548,467 1,929.281 Creditor5". amounts falling due within one year 1365,6991 1478.0221 Net current assets 1.182,769 1.451,259 Total net assets 2.888,100 3.104,140 The funds of the charity.. Restricted income fund5 Unrestricted income fund5'. General fund5 288,019 300,886 2,600,081 2,803.254 Total unrestricted funds 2.600,081 2.803,254 Total charlty funds 2.888,100 3,104,140 Approved by the trustee5 on 29 August 2023 and signed on their behalf by Robert Pearce Chair Helena Wallis Chief Executive Officer 28

Heart of England Mencap Statement of cash flows For the ear ended 31 March 2023 Note 2023 2022 Cash fl¢)w5 from operating activitie5 20 Net cash used in operating activities 1346,1401 1250,1011 Cash fl¢)w5 from investing artivitie5'. Dividends and interest from investments Purchase of fixed as5et5 Proceed5 from the Sale of inve5rrnenrs 6,116 {105,5941 4,018 1428,5371 107,598 Net cash provided used in investing artivities 199,4781 Cash fl¢)w5 from financing activities.. Repayments of borrowing Net cash used in financing activities {175,3111 146,9121 1175,3111 146,9121 Change in cash and cash equivalents in the year 1620,9291 1613,9341 Cash and cash equivalents ar rhe beginning of the year 1,144,721 1,758,655 Cash and cash equivalents at the end of the year 523,792 1 144,721 Analysis of cash and cash equivalent5 and of net debt At l April 2022 At 31 March 2023 Cash flows Cash at bank and in hand 1,144,721 1620,9291 523,792 Total cash and cash equivalent5 ,144,721 1620,9291 523,792 Loans falling due within one year Total debt 175,312 Total 969,412 1445,6161 523,792 29

Heart of England Men¢ap Notes to the financial staiement$ For the ear ended 31 March 2023 l Actounting policies al Statutory information Heart of England Meniap is a charitable company limited by guarantee and 15 incorporated in the United Kingdom. The registered office addre55 and principal place of busine55 is 5 Church Green, Atherstone on Stour, WaTwickshire, CV37 8NE. bl Basis of preparation The financial statements have been prepared in aicordance with Aicounting and Reporting by Charities.. Statement of Recommended Practice appliiable to charities preparing their aicount5 in aicordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 (Charitie5 SORP FRS 1021, the Financial Reporring Standard applicable in the UK and Republii of Ireland IFRS 1021 and the Companies Act 2006. In applying the finaniial reporting framework, the trustees have rnade a nurnber of 5ubjeiti¥e judgements, for example in respect of significant aicounting estimates. E5tirnates and judgements are continually evaluated and are based on historical experienie and other factor5, including expectation5 of future events that are believed to be reasonable under the circurnstances. The nature of the estimation means the actual outcome5 could differ from those estimates. Any significant estimates and judgements affecting these financial statements are detailed within the relevant aicounting policy below. A55ets and liabilities are initially recognised at historical cost or transaction value unle55 Otherwise Stated in the relevant aciounting poliiy or note. The account5 are prepared a5 full values however are presented to the nearest £1. Thi5 may cause small di51repancie5 in the financial 5tatement5. ¢1 Public benefit entity The charitable company meets the definition of a public benefit entity under FRS 102. dl Going ioncem The trustees ionsider that there are no material uncertainties about the charitable company s ability to iontinue a5 a going concern. The trustees do not ionsider that there are any sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of asset5 and liabilities within the next reporting period. The trustees iontinually review progress against budget, their cash flow foreiast5 and borrowing plan5. They reiognise that there will have to be changes in the way that some services are delivered in the mediurn term and that this will have an effeit on the contributions whiih can be aihieved from the various serviies. Funding leve15 and the fair cost of care will be discussed with funders and off framework packages be Sought where p055ible. Although there will almost certainly be services which cannot continue, they believe that there are opportunities to reshape services and for the teams to introduie creative new solutions to satisfy the needs of Iu5tomer5 and they have therefore concluded that It is reasonable to consider that the charity continues to be a going concern. el Income Income 15 recognised when the Iharity has entitlement to the fund5, any performance conditions attached to the iniome have been met, it is probable that the income will be received and that the amount can be measured reliably. Income from government and other grant5, whether'capital. grant5 or'revenue. grants, 15 recognised when the charity ha5 entitlement to the funds, any performanie ionditions attached to the grant5 have been met, it is probable that the iniome will be received and the amount can be measured reliably and 15 not deferred. Income received in advanie of the provision of a specified seTvice is deferred until the Iriteria for iniome recognition are met. For legacie5, entitlement is taken as the earlier of the date on whiih either-. the charity is aware that probate has been granted, the estate ha5 been finalised and notifiiation has been made by the executorlsl to the charity that a distribution will be rnade, or when a distribution 15 received frorn the estate. Receipt of a legacy, in whole or in part, is only considered probable when the amount can be measured reliably and the charity ha5 been notified of the executor's intention to make a distribution. Where legacies have been notified to the charity, or the charity is aware of the granting of probate, and the criteria for income recognition have not been met, then the legacy is a treated as a contingent asset and disclosed if material. f) Interest receivable Interest on funds held on deposit is iniluded when receivable and the amount can be measured reliably by the charity-. thi5 15 normally upon notifiiation of the interest paid or payable by the bank. gl Fund a¢¢ounting Restriited fund5 are to be used for 5pecifii purposes as laid down by the donor. Expenditure whiih meet5 these Iriteria 15 charged to the fund. Unre5tri(ted funds are donations and other incoming re50uries received or generated for the charitable purposes. 30

Heart of England Men¢ap Notes to the financial staiement$ For the ear ended 31 March 2023 l Actounting policie5 Icontinuedl h) Expenditure and irrecoverable VAT Expenditure is reiognised once there 15 a legal or con5truiti¥e 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 is Ila55ified under the following activity headings.. Costs of raising funds relate to the cost5 incurred by the charitable company in induiing third partie5 to make voluntary iontribution5 to it, as well a5 the cost of any activitie5 Wlth a fundraising purpose Expenditure on charitable activitie5 include5 the 105ts incurred by the charity in the delivery of it5 aitivities and 5ervice5 for it5 beneficiarie5 and their as501iated sUPPOrt costs. It includes both costs that can be allocated directly to such a(tivitie5 and those costs of an indirect nature nece55ary to support them. Other expenditure represents those item5 not falling into any other heading Irrecoverable VAT is charged a5 a cost against the aitivity for which the expenditure wa5 incurred. il Allocation of support and governanie costs Resources expended are allocated to the partiiular activity where the cost relates direitly to that activity. However, the cost of overall direction and administration of each aitiviry, cornpri5ing the salary and overhead cost5 of the central funition, 15 apportioned based on staff cost, of the amount attributable to each activity. Where information about the aim5, objectives and projeit5 of the Iharity is provided to potential benefiiiaries, the costs associated with this publicity are allocated to charitable expenditure. il Operaiing leases Rental charge5 are charged on a Straight line basis over the term of the lease. k) Tangible fixed assets Items of equipment are capitali5ed where the purchase price exieed5 £500. Depreciation 105t5 are allocated to activitie5 on the basi5 of the Use of the related asset5 in those activities. Assets are reviewed for impairment if circumstances indiiate their carrying value may exceed Where fixed a55et5 have been revalued, any exce55 between the revalued amount and the historic 105t of the a55et will be Shown a5 a revaluation resepie in the balance sheet. Depreciation is provided at rates calculated to write down the c05t of eaih asset to its estimated residual value over it5 expected useful life. The depreciation rates in use are a5 follows-. Long leasehold building5 Shorr leasehold buildings Improvernents buildings Contents and equipment 20% straiqht line 25% straiqht line 11 Listed invesiments Investments are a form of financial in5trurnent and are initially recognised at their transaition value and subsequently measured at their fair value as at the balanie sheet date using the c105ing quoted market price. Any change in fair value will be recognised in the statement of financial activitie5. Investment gain5 and losse5, whether realised or unreali5ed, are combined and shown in the heading 'Net gainsll1055e51 on investments" in the 5taternent of finaniial aitivities. The Iharity does not acquire put options, derivatives or other complex financial instruments. ml Debtor5 Trade and other debtor5 are recognised at the settlement amount due. Prepayment5 are valued at the amount prepaid. n) Cash at bank and in hand Cash at bank and cash in hand includes cash and short term highly liquid investment5 Wlth a short maturity of three month5 or le55 from the date of aiqui5ition or opening of the deposit or similar aciount. ol Creditors and provisions Creditors and provisions are recognised where the charity ha5 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. Creditors and provision5 are normally recognised at their settlement amount after allowing for any trade discount5 due. pl Financial instrumenls The charity only has finaniial a55et5 and financial liabilities of a kind that qualify a5 basic financial instruments. Basic finaniial in5trument5 are initially recognised at transaition value and subsequently rnea5ured at their settlernent value. 31

Heart of England Men¢ap Notes to the financial staiement$ For the ear ended 31 March 2023 l Actounting policie5 Icontinuedl 41 Coronavirus Busine55 Interruption Loan Scheme During the prior year the charity took out a loan under the Coronavirus Bu5ine55 Interruption Loan Scheme. Thi5 loan was to provide financial security in case the Iharity suffered a drop in revenue. Bank loans are initially recognised at transaction value and subsequently measured at amort15ed lost Using the effective interest method. This wa5 repaid in full in April 2022. rl Pension$ A new defined contribution siherne with the Pensions Trust wa5 Set up on l August 2014 to comply with automatic enrolment requirements. All members of staff not iovered by other arrangements are enrolled a5 they become eligible. The charity operate5 a defined contribution Croup Stakeholder pension siheme with NFU Mutual as the designated provider. Pension cost5 are charged to the Income and Expenditure Account as they are incurred. Employee5 who were TUPE'd airo55 a5 part of the Complex Need5 Service5 remained in a Separate defined contribution siheme operated by LCPS. 2 Income from donations 2023 Toial Unrestricted 2022 Total Unrestricted Restriited Restriited Donations 22,077 22.077 9,081 73,813 82,894 22,077 22.077 9,081 73,813 82,894 3 Income from charitable activities 2023 Toial Unrestricted 2022 Total Unrestricted Restriited Restriited Income from Warwickshire County Council 183,788 183.788 176,155 176,155 Sub-total for Residential iare 183,788 183.788 176,155 176,155 Income from Warwickshire County Council Income from Continuing Health Care ICHCI Other income from Short Stay 843,267 259,143 274,247 843.267 259.143 274.247 770,889 276,445 167,721 770,889 276,445 167,721 Sub-total for Short stay 1,376,657 .376.657 1,215,054 1,215,054 Income from Warwickshire County Council Income from Continuing Health Care ICHCI Other income from Domiiiliary care and support 2.311.193 217.725 110.300 2,237,328 2,237,328 217,725 10,300 330,429 330,429 Sub-total for Domiciliary iare and 5UPPOrt 2,639,218 2.639.218 2,567,757 2,567,757 Income from Warwickshire County Council Income from Continuing Health Care ICHQ Other income from Dayrime activitie5 253,306 3,474 14,594 253.306 3.474 14.594 202,600 202,600 70,402 70,402 Sub-total for Daytime aitivities 371,374 371.374 273,002 273,002 Income from Warwickshire County Council Income from Continuing Health Care ICHQ Other income from Complex Need5 674,570 266,131 1,470 674.570 266.131 1.470 674,728 262,009 674,728 262,009 Sub-total for Complex need5 5eTvice 942,171 942.171 936,737 936,737 Total iniome from charitable activitie5 5,513,207 5.513.207 5,168,704 5,168,704 32

Heart of England Men¢ap Notes to the financial staiement$ For the ear ended 31 March 2023 4 Incorne from other trading artivities 2023 Total Unrestricted 2022 Total Unrestricted Restriited Restricted Fundraising events and Small grant5 Customer holidays, WDF and other income 100 36,997 27,772 27.872 36.997 3,438 70,346 3,438 70,346 37,097 27,772 64.869 73,784 73,784 5 Other income 2023 Toial Unrestricted 2022 Total Unrestricted Restriited Restricted Infection Control, Rapid Testing and Workforce Grants 148,706 148,706 148,706 148,706 6 Income from investments 2023 Toial Unrestricted 2022 Total Unrestricted Restriited Restricted Income from UK listed investments Bank interest receivable 2,867 3,248 2.867 3.248 3,978 40 3,978 40 6.116 4,018 4,018 33

Heart of England Mencap Noies to ihe financial siatements For the ar ended 31 March 2023 7a Analysis of expenditure (current year) Dorniciliary Care and Support Complex Needs Service Daytime Covernance Costs Support costs 2023 Toial 2022 Total Care Short Stay Staff costs (Note 91 Staff costs INote 91- l R I Office rent Audit fee5 Training costs Other direct cost5 Computer SupplieslTelephone CleaninglHygienelH&S Housing c05t5lRent Licences, fees and insurance Miscellaneous Fundraising expenditure Depreciation 140,209 826,914 2,237,581 278,104 764,409 461,698 4.708.914 4,254,735 148,706 16,000 11,580 59,156 336,608 139,533 62,471 17,005 180,174 29,664 12,929 44,178 16,456 16.456 11.500 56.739 350.887 1,500 850 101,540 2,955 15,951 15,000 10,879 213 468 12,988 50 49,276 4,145 10,474 45,154 29,472 2,807 1,089 1,748 500 87,587 2,105 23,963 55,339 50,771 152,538 10,481 1,656 178,576 14,344 32,521 5,235 14,219 717 2,700 6,923 1,323 47,494 750 6,531 28,398 ,237 70.101 97.130 221.865 17.552 54.809 43.399 378 193 3,769 16,962 10,251 266 166,357 987,757 2,391,796 389,721 885,816 1,500 979,617 5.812.564 5,412,739 Support C05t5 32,559 243,881 467,315 66,089 169,773 (979,6171 Governance cost5 382 2,863 5,486 776 1,993 Total expenditure 2023 199.298 1.234.501 2.864.596 456.587 1.057.582 5.812.564 Total expenditure 2022 ,167,238 372,340 968,914 5,412,739 ,{ R l = Restricted fund5 The basi5 of allocation of support and governance c05t5 to activities is staff time. 34

Heart of England Mencap Note5 to the financial statement5 For the ear ended 31 March 2023 7b Analy515 of expenditure (prior year} Charitable activities Domiciliary Care and Support Cornplex Needs Service Residential Care Daytirne Activities Governance costs Support C05t5 2022 Total Short Stay Staff costs (Note 91 Staff costs (Note 91- l R I Office rent Audit fee5 Training costs Other direct costs Computer SupplieslTelephone CleaninglHygienelH&S Housing c05tslRent Licences, fees and insurance Miscellaneous Fundraising expenditure Fundraising expenditure Depreciation 107,805 5,084 762,961 34,766 2,052,218 73,200 234,067 8.657 655,044 26,998 442.639 4.254,735 148,706 16,000 11,580 59,156 336,608 139,533 62,471 117,005 180,174 29,664 16,000 11,580 3,533 98,584 2,664 11,091 15,000 11,248 1,214 1,728 40,129 5,032 9,969 70,495 16,877 874 2,800 28,800 764 2,736 26,474 1,333 84 76,852 2,251 25,552 51,011 77,445 128,051 14,798 772 1,793 5,002 1,337 368 149,012 28,097 360 5,337 2,385 10.292 2.724 11.048 7,461 5,514 12,929 44,178 499 11,488 137,090 952,549 2,276,220 318.307 800.399 11,580 916,594 5.412,739 Support costs 31,339 214,293 451,191 53.359 166.413 1916,5941 Governance costs 2,707 396 5,700 674 2.102 111.5801 Total expenditure 2022 71,136 ,167,238 2,733,111 372,340 968.914 5,412,739 '( R l = Restricted funds The basis of allocation of support and governance costs to activities is staff time. 35

Heart of England Mencap Note5 to the financial statement5 Net income I lexpenditurel 2023 2022 Depreciation Operating lease rental5'. Property Other Auditor5, remuneration lexiluding VATI. Audit 43,399 44,178 113,586 28,647 8,982 11,500 9,950 Anoly515 Qf staff c05t5. trustee remuneration and expenses, and the c05t of key management personnel Staff costs were as follows.. 2023 2022 Salaries and wages Redundanq and termination cost5 3.955,546 3,740,447 35,084 301,076 130,356 333,270 131,142 Employer's contribution to defined iontribution pension 51hemes Total employee costs 4.419,958 4,206,963 Ageniy and Community SeNice Volunteer5 Costs 288,956 196,478 Total staff c05t5 a5 per note 7 4.708,914 4,403,441 The following nurnber of employees received employee benefits lexiluding employer'5 national insurance and employer's pension cost5 during the year be￿een. 2023 No. 2022 No. £40,000 - E50,000 £60,000 - £69,999 £80,000 - E89,999 The total ernployee benefits (including employert5 national insuranie and employer'5 pension contributionsl of the key management personnel were £213,135 12022-. £173,276). The charity trustee5 were not paid nor reieived any other benefits from employment with the charity in the year 12022.. £nill. No charity trustee received payrnent for professional or other Se￿ICe5 supplied to the charity12022. Enill. The amount Ilaimed by trustees for the reimbursement of travel and sub515tence wa5 E213 12022-. £1491. Thi5 wa5 claimed by 2 tru5tee5 12022.. 2 l O Staff numbers The average number of employees (head count based on number of staff employed) during the year wa5 35 follows.. 2023 No. 2022 No. Chief Executive Care and support staff, including Registered Manager5 Administration 197 186 210 197 36

Heart of England Mencap Note5 to the financial statement5 I l Related party tran5artion5 There are no related party transaitions to di5c105e for 2023 12022.. none). There are no donations from related parties and no restricted donations from related parties. 12 Taxation The society 15 exempt from corporation tax as all its income 15 charitable and is applied for charitable purp05e5. 13 Tangible fixed assets Long leasehold Short leasehold Contents and property property equipment Freehold propertv Motor Vehicle5 Total C05t At the start of the year Additions in year Disposals in year 1,127,000 70,000 210,481 86,695 14,8741 240,090 18,899 146,479 13,000 1.660,571 105.594 156.3531 Is,0001 At the end of the year 1,127,000 70,000 292,301 212,510 8,000 1.709,812 Depreciation At the start of the year Charge for the year Eliminated on disposal 64,508 13,032 12,600 1,400 115,003 201,497 13,855 146,479 13,000 406.608 43.399 156.3531 14,8741 Is,0001 At the end of the year Net book value At the end of the year 77,540 14,000 125,240 168,873 8,000 393.653 1,049,460 56,000 167,062 43,637 1.316,159 At the start of the year 1,062,492 57,400 95,478 38,594 1,253,964 Land with a value of E475,400 12022. £475,4001 is included within freehold property and not depreciated. In respell of the long leasehold property, during the year ended 31 March 2013 an agreement was made between Heart of England Meniap and Orbit Housing Association regarding 27 and 29 Stratford Road, Ship5ton on Stour, the details of which are a5 follow5. Heart of England Meniap to lease the site to Orbit Housing A5501iation Ltd for seventy years., Heart of England Meniap to retain the freehold.. Orbit Housing Assoiiation Ltd to demolish the two properties and build ten flat5 With additional staff accommodation to provide facilitie5 for Heart of England Meniap's customers-. Heart of England Meniap to underlea5e one of the flats for seventy years.. and After seventy year5 all the flats revert to Heart of England Mencap. All of the above assets are used for charitable purpose5. 14 Listed investment5 2023 2022 Fair value at the start of the year Additions at 105t Disposal proceeds Net gain 1110551 on Ihange in fair value Net gain 1110551 on Ihange in fair value 398,917 357,916 106,000 1107,5981 28,460 14.6161 Fair value at the end of the year 389,172 398,917 Investments comprise. 2023 2022 COIF Dep051t Fund COIF Ethiial Investment Fund COIF Charities Investrnent Fund 14,283 243,207 131,683 14,034 248,072 389,172 398,917 37

Heart of England Mencap Note5 to the financial statement5 15 Debtor5 2023 2022 Trade debtors Prepayments Accrued income 673,763 99,246 251,666 436,144 83,089 265,327 .024,675 784,559 16 Creditors.. amount5 falling due within one year 2023 2022 Trade creditor5 Bank loan5 Taxation and social security Pensions Ireditors Individual Service Fund5 Accruals 102,682 43,028 176,660 23,462 6,250 56,645 177,842 6,868 7,843 67,130 365,699 478,022 17 Pension 5cherne A new defined contribution 51herne with the Pen510ns Trust wa5 set up on 1 August 2014 to comply with automatii enrolrnent requirernents. All member5 of staff not iovered by other arrangement5 are enrolled a5 they become eligible. Ernployer iontributions in the year totalled £73,428 12022.. £68,8291. From l April 2009 to l August 2014, members of staff were eligible to Join a iontributory Group Stakeholder Pension operated by NFU Mutual. Employer contribution5 in the year totalled £395 12022.- £8801. Employees who were TUPE'd acr055 a5 part of the Complex Needs se￿iCe5 remained in a seperate defined contribution 51heme operated bv LCPS. This scheme as an agreernent for a fixed employer iontribution rate of 24% for the duration of the contract and employer contribution5 in the year totalled £57,519 12022.. £60,647). 38

Heart of England Mencap Note5 to the financial statement5 18a Analy515 Qf net a55et5 between funds (current yearl General Total funds Tangible fixed a55et5 Investments Net current a55ets 1.316,159 389.172 1.182,769 257,490 1,056,375 131,683 126,394 Net a5set5 at 31 March 2023 2.630.023 258,076 2.888,100 18b Anoly515 Qf net a55et5 between funds (prior yearl General Total funds Tangible fixed a55et5 Investments Net current a55ets 1,21 S,382 262,106 1,325,766 38,582 1.253,964 398.917 1.451,259 125,493 Net a5set5 at 31 March 2022 2.803.254 300,886 3.104,140 19a Movements in funds Icurrent yearl Expenditure & At 31 March 2023 2022 Iniome & gains Tran5fer5 Restricted funds fixed a55ets= Valley Road 9rant5 Sensory Grant IWCC Stratford Town Trust Elta House refurbishment Ceneral Fundraising 14,381 2,855 14,000 7,346 13.341 1.713 8.000 6.888 16,000 1458 Total restricted funds fixed a55ets 38,582 18,640 29.942 Restricted funds= Trust ReSe￿e investments 56 Ash Crove sensory equipment and summer house Welfare Fund Friends of Mencap Stratford Town Trust Stratford Pathway Kenilworth Ladies Circle Warwick Pathwav Valley Road 9rant5 Sensory Grant IWCC joint Healthy South Warwiikshire IWCCI Big Lollery Fund Grant IBig Potentiall Independent Living Projeit Valley Road - Mayor 131.683 29,207 1,642 178 1,085 557 733 1,280 3,450 5,000 2,125 1,579 5,904 29.207 1971 988 557 733 136 3.450 5.000 2.125 Healthier Me Beacon Grant - Mencap H Bannister Think Aitive Together Fund 12,564 3.340 26.842 51.591 2.406 21,250 2,500 4,022 1941 14,022 Total other restricted fund5 262,304 27,772 132,000 258.077 Total restricted funds 300,886 27,772 140,639 288.019 Unre5trirted fund5'. 2,803,254 5,578,497 15,781,669) 2.600,081 Total unre5trirted funds 2,803,254 5,578,497 15,781,669 2.600,081 Total funds 3,104,140 5,606,269 15,822,309 2.888,100 39

Heart of England Mencap Note5 to the financial statement5 For th 19b Movements in funds Iprior yearl At 31 March 2021 Iniome & gains Expenditure & Tran5fer5 At l April 2022 Restricted funds fixed a55ets= Valley Road 9rant5 Sensory Grant IWCC Stratford Town Trust Elta House refurbishment Ceneral Fundraising 15,420 14,679 20,000 5,158 14.381 2.855 14.000 7.346 16,000 1787 2,976 Total restricted funds fixed a55ets 55,257 2,976 38.582 Restricted funds= Trust ReSe￿e inve5trnents Infection Control, Rapid Testing and Workforce Grants Purhca5e of fixed assets from restricted funds 56 Ash Crove sensory equipment and sumrner house Welfare Fund Friends of Mencap Bike 4 Bikes Stratford Town Trust Stratford Pathway Kenilworth Ladies Circle Warwick Pathwav Valley Road 9rant5 Sensory Grant IWCC Joint Healthy South Warwiikshire IWCCI Big Lollery Fund Grant IBig Potentiall Independent Living Projeit Valley Road - Mayor 14,138 148,706 149,8421 1148,706 136.811 29,207 1,642 734 1,753 1,085 557 1,910 1,280 3,450 5,000 2,125 1,070 6,030 29.207 1.642 178 1.085 557 733 1.280 3.450 5.000 2.125 1.579 5.904 21.145 51.591 972 1463 Healthier Me Beacon Grant - Mencap H 8anni5ter 21,250 Total other restricted fund5 228,376 236,658 1202,730 262.304 Total restricted fuThds 283,634 236,658 2,976 300.886 Unre5trirted fund5'. 2,820,137 5,284,048 15,297,955 12,9761 2.803,254 Total unre5trirted funds 2,820,137 5,284,048 15,297,955 12,9761 2.803,254 Total funds 3,103,771 5,520,705 15,520,336 3.104,140 40

Heart of England Mencap Note5 to the financial statement5 Purp05es of re5trirted fund5 Trust Reserve - In 1994 Heart of England Mencap reieived a donation in the form of investment5. The cumulative unrealised gain relating to these inve5trllentS 15 £123,844 12022. EI 28,9721 which is included in the restricted fund. The use of the fund 15 restricted to the general welfare of custorners. CoronavirusllThfection Control, Rapid Testing and WorkForce Grant5 during the prior year we were allocated various fund5 from the Local Authority for speiified uses a93inst additional iosts incurred due to Coronavirus. These have been spent in aicordance with the restriction5 given within the allocated time periods and reported on. 56 Ash Grove Sen50ry Equiprnent and Sumrner House This fund 15 restricted to the purchase of sensory equipment and a Summer house at 56 Ash Crove, Eve5ham. Welfare Fund These are donations received and are restricted to the general welfare of the customers in Specific group5. Friend5 Qf Mencap - These funds are held seperately and income is from fundraisin9 event5 organised by Friend5 of Mencap. All expenditure is authori5ed by the Ihair of Friends of Mencap and groups apply for funding for specific item5 and projeit5. Bike 4 Bikes The use of this fund 15 restricted for adapted bikes for the disabled for use by all customers. Stratford Town Trust Stratford Pathway - This grant is from Stratford Town Trust and the use is restricted to the use for Pathway customers who live within the CV37 postcode area. Kenilworth Ladie5 Circle Wanvick Pathway- This grant 15 from Kenilworth Ladie5 Circle and the use is re5triited to the use for Warwick Pathway. Valley Road Grant5 These are restriited grant funding for the replacement of the bathroorn and kitchen at Valley Road. Sensory Grant ￿CCI This grant was from Warwiikshire County Council to develop the sensory space at Ford5field to provide the opportunity for our customers and rllembers of the local iommunity to have the stimulation and experiences that are diffiiult to achieve through every-day experienies. Durin9 2021122 year a sensory bath wa5 purchased for £5,170 which was transferred to the fixed asset Section at the top of note 20. Joint Healthy South Warwickshire ￿CCI This grant is from Warwiikshire County Council to fund our 'Being Healthy projeit'_ supporting our Iu5torner5 to lead more healthy lifestyle5. Big Lottery Fund Grant (Big Potentiall- This grant 15 from the Big Lollery Fund for scoping the exisiting provision and potential future demand for a social investment project. Henry Smith Charity- My tife Project This is a three year grant to pay for the salary and on costs of a co-ordinator for young adult5 aged 18-25. Independent Living Project This grant is from Bailey Thomas for the Independent Living Project to run a pilot independent living projeit for five young people aged 16-25 with mild to rnoderate learning disabilities IMMLDI. Stratford Town Trust - Elta House This grant is from Stratford Town Trust which wa5 used to cover part of the cost of Suite B, Elta House to provide a new setting for our Pathway day service in Stratford upon Avon town centre. Valley Road - Mayor- This was a donation received frorn the Mayor of Leamin9ton Spa for use within our respite service at Valley Road, Leamington Spa. Warwickshire County Council Friendship Circle This was created to help those with a learning disability connect with other5 and be part of a social networking 9roup. Let's Get Digital This scheme was introduced to us by National Mencap to develop digital conneitivity opportunities for people with a learning disability, 5UPPOrt the transition to digital ways of working, provide acie55 to training and resource5 and the development of Digital Champion5. Healthier Me - This project is to support people with a learning disability to provide them with a beller understanding of the relationship between food, diet, exercise and a healthy lifestyle. Beacon Grant- Mencap- This grant is to support a iommunity-led development programme in partnership with Royal Mencap. The aim of the fundin9 was to establish and test a community led approach over the next two years to enable people with a learning di53bility to drive and shape loial System changes. H Bannister a customer of Heart of England Meniap, sadly died and a5 the beneficiary of a fund in her mother's will, which wa5 left in trust, Heart of En9land Mencap was the benefiiiary of the residual fund. The general restrictions stated in the will identified that the funds should be used towards projects that benefit 5erviies delivered in Stratford upon Avon, without specifiially statin9 any binding limitations or Think Active - This grant from B2022 small grants funding is re5triited to promote eco-friendly activties and iommunity engagement, focusin9 on minority groups within the cornrnunitv. Together Fund - Sport England - This grant paid was restricted for the 105ts for g employee5 training, 2 green dragon trike5 and s Safety helmets. General Fundraising This fund is frorn other fundraising aitivities and donations and the use of thi5 fund is restricted to enable Iu5tomer5 41

Heart of England Mencap Note5 to the financial statement5 20 Reconciliation of net lexpenditurel l income to net cash flow from operating artivities 2023 2022 Net lexpenditurel l income for the reporting period las per the statement of financial actDiitiesl Depreciation charge5 L05sesllgainsl on investment5 Dividends and interest from investrnents Transfer of investrnent from accrued income Ilncreaselldecre35e in debtors 1216,0401 369 43,399 9,745 44,178 142,5991 14,0181 1106,0001 158,5491 183,4821 1240,1161 62,988 Net cash used in operating artivitie5 1346,1401 21 Operating lease commitment5 The charitvs total future minimum lease payment5 under non-iancellable operating leases 15 35 follows for each of the following period5 Propertv 2023 Equipment 2023 2022 2022 Le55 than one year One to five year5 50.154 56,805 40,340 72,945 6,634 10,452 50,154 56,805 113,285 17,086 22 Contingent a5set5 Qr liabilitie5 There 15 3 charge of £30,000 on the freehold property at Ship5ton-on-Stour, in favour of the Secretary of State for Health which would become payable should Heart of England Mencap cease to provide care in the community for people with learning disabilities. There 15 a guarantee in place in favour of Warwickshire County Council in the sum of El 34,000, seiured by way of a bond, relating to ongoin9 commitment5 to the Local Government Pension Scheme in relation to the staff taken on under the complex need5 se￿ice contract. Seiurity will need to be maintained for the duration of the contraa. 23 Legal status of the charity The charity is a company limited by guarantee and ha5 no Share capital. The liability of each member in the event of winding up is limited to 42