TREE CHARITABLE TRUST ANNUAL REP 31 December 2021 PA YNE HICKS BEACH Solicitors 10 New Square Lincoln's Inn London WC2A 3QG THE BAY TREE CHARITABLE TRUST CONTENTS Administrative infomialon 8boul the ch8rily, the trustee8 and their advisor8 Trustees, report 9-12 Independent auditor's report un 13 Statement of financial activities 14 Balanc8 sheet 15-18 Principal accounting policies 19-23 Nol¢s to the accounts èndix 24 Grants made THE BAY TREE CHARITABLE TRUST Pa ADMINISTRATIVE INFORMATION A80UT THE CHARITY THE TRUSTEES AND THEIR DVISOR TRUSTEES l.M.P. Benton MISS E.L. Benton P.H. Benton PRINCIPAL DD ESS The Bay Treè Charitable Trust PO Box 53983 London SW15 1VT CHARITY REGISTRAT ON NUMBER 1044091 DIT Buzzacott LLP 130 Wood Street London EC2V 6DL ANKERS Qulller Ch#viot Senator House 85 Queen Viclorta Street London EC4V 4AB INVESTME GERS Quilter Cheviol One Kingsway London WC2B 6AN SOLICITORS AND ADMINISTRATORS Payne Hicks Beach LLP 10 New Square Lincoln's Inn London WC2A 3QG THE BAY TREE CHARITABLE TRUS Pa TRUS EPORT- 31 DECEMBER 2021 Tha tru8lee8 present their statutory report together with the accounts of The Bay Treo Charitable Trust for the year ended 31 Dècèmber 2021. The accounts have been prepared In 2ocordance with the accounting policie8 sel out on pages 1510 18 tsf the attached accounts and comply with the charitws trust deed, applicable laws. accounting standards (United Klngdom Gents1811y Accepted Accounting Praclicel, and Accounting and Reporting by Charilies.. Statement ol Recommended Practice applicablo lo ¢h8ri1ies preparing their accounts in acwrdance wlh the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland IFRS 1021. sÈcond edition Ioclobgr 20191. GOVERNANCE. STRUCTURE AND MANAGEMENT Governance The Bay Tree Charitable Trust is governed by a Irust deed daled 1 December 1994. The charity Is wislered under the Charities Act 2011, Charity Registration Number 1044091. The sialLttory power of appoinlmant ol Iws18e8 by the continuing Iruslees applies. The names of the trustees who served durinu the year ale sel out as part of the adminislralNe information on page 1 of this Annual Report and Accounts. Brief biographical details are given below.. l.M.P. Benton Mr. Benton is related lo Ihe settlor and was appointed a Iruslee on 15 December 1994. Mlss E.L. Bgnton Miss Benton is related lo th& wttlor and was appointed a Iruslee on 22 October 2002. P.H. Bantoft Mr. Benton is related to the seltlor and was appointed a trusteè on 22 October 2002. On agreeing lo their appointment, the trustees are thoroughly briefed by their co-truslees on the hlstory of the trust, the day-lTrday management, the responsibilities of the trustees, the current objectives and future plans. Tru8tses' responslbllltle8 Statement The Iruslees are responsible for preparing the trustees, report and accounts in accordance with applicable law and Unltèd Kingdorn Accounting Standards (United Kingdom Generally Accepted Accounting Practice}. Charity law in England and Wales reqLsiie5 the Iru5tee$ lo prep8re accounts for e8ch financi81 year which give a ITUO and fair view ol the slate of affairs of the charity at the year end and ol its income and expenditure during that y&ar. In preparing a¢counts. giving 8 true and fail view th8 trustees ar& rèquiiéd lo.. Select suitable accounting policies and then apply them consislently,, Observe tha mèthods and principles of Accounting and Reporting by Charities.. Statement of Recommended Practice appllcablè to charities prèparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland IFRS 1021.. HEB ITABLE TRUST TRUSTEES, REPORT- 31 DECE BE 21 GOVERNANCE, STRUCTURE AND MANAGEMENT leontlflU8dl M8ko judgemen18 and estimales that are reasonable and prudent.. Stsl8 whether applicable United KitYJdom Accounllng Standards have been followed. subject to any material d&partures di$clo89d and explained in the accounts., and Prepare the accounts on the golng concern basls unless It Is Inappropriate lo presume that th6 tharily will Continue lo operate. The Iruslees are responsible for keeping propèr accounting rectsrd$ which disclose with reasonable accuracy al any lime the financial position of the charity and which enable them to ensure that thè accounts comply with the Charilies Acl 2011, applicable Charity (Accounts nd Reports} Regulations and the provisions of the tiusl deed. They 8re also iespon8ible for 5of8guarding the assets of the charity and henTr for taking reasonable steps for thè prevention and deleclion of fraud and other irregularities. structure and manag•m•nt r&porting The trustees are ultimat61y r8spon8ible for the policies, activities and assets of the tharity. They meet annually to review the developments with regard to th8 charily. Ils grant giving activitles and make any important decisions. When necessary, the Iruslees seek advi and support from the charills profession81 advi8ers including investment managers, solicilors and accountants. The day lo d8y management of the charity's activities, and the implementation of policies. is delegated lo the Priv819 Glignl Departm8nl of Payne Hicks Beach. The Department ensures that grant applications are processed and presented to the trustees as appropriate,. il admini81ers payment8 and keeps the books and records of the charity. At thèlr mèètings Ihg Iru3lees review the investment performance. and the investment managers attend the meetings to updatè thè trustèes in detail on the portfolio. Th8 IIu81ees revigw the pioposals for grants lo be made and approve such grants as appropriate. Rlsk management In line with the requirement for charfty trustees to undertakè a rfsk assessmènt exerclse and report on the same in their annual report, the trustees have looked at the risks the charity currently 18ce8 and have reviewed the measures in place, or needing lo be pul in place, to deal with them. In addition to the cisks associated wilh COVID-19 {8ee bolowl, the trustees have identified thre6 malt) aroas where ri5k8 may occur., Governan¢o Operational Financial Govornance looks al the conlinuily of trusteeship. the skills and ba¢kground ol the trustees and the policies of regular meetings of the trustees to review their alms and a¢tlvitiès. Operational looks al the risk inherent in the delegation of statutory and18gal raqulrèments ol the charity, ils management 8nd secretarial functions and delegation of certain of those functions, and ils grant giving activities. BAY TREE CHARITABLE TRUST TRUSTEES, REPORT- 1DE EMBER 2021 GOVERNANCE. STRUCTURE AND MANAGEMENT Icontlnuedl Financ5al iisks include those inherent In delegation of inve81rnenl management and custody lo an independent investment manager, Ihe Ilnanoal ￿cold keeping of the charity, ils Inv&slrnenl policy, audit and review procedures. Having assessed the Major risks lo which the charity is exposed. in particular thos8 relatlng to ils investments and ils finances. the Iruslee8 believe that by ensuring conlrols exist over key financial systems, incorporating the systems ond conliols itllplem8nled by Payne Hicks B6aeh. and by delegating Ihe investment managemenl function to investment managers. subject to regular monitoring, including pèriodic revi8W8 of performance against benchmarks. they h8ve established effective sys(ems lo mitigate those risks. In reaching Ihis condusion. the trustees have considered thè imp&et on th6 charity tsf the COVID-19 pandemlc. Th& kÈy8 risks faced by the charity. as identified by Ihe trustees, are described below logethe¥ with the prinapal ways in which thèy are tnilig81ed. The charity's principal asset comprises listed inveslrnenls, the volue of which 18 dependent on movernenls in UK and world stock markets. The investments are managed by reputable investment managers who adhere lo a policy agreed by the Iiuslees. The Iruslees meèt annually with the investment managers and the managers, performance and that of the portfolio are monitored. The inv6Stment stralfjgy is 88se38ed regularfy lo ensuie il remains appropiiale to the charity's needs- both now and in the future. The charity carries out Ils objeclivos by pioviding grants lo inslilulions that are also UK registered charities. whose objects comply wilh the charity's criteria. There is a risk that a grant provlded by thè charity may not reach the intended recipient andlor may be used for purposes not consislenl with the charity's objects. Whilst the Irustees are mindful ol their own obligation to ensure that the charity benefits the public generally, Ihey18ke 50mè assuran￿ from the fact thal recipients of grants are themselves regulated to ensure that they operate for the publSe benefit. ACTIVITIES, SPECIFIC OBJECTIVES AND RELEVANT POLICIES Actlvitle8 and speclfic oblectlves The Iruslees operate a grant giving policy, providing funds for such charitable object or instilution as the trustees think fit. All appeals should be by letter contsinlng the follovlng.. Aims and objectives of the chaiity Nature of appeal Total targel if for a sp8¢iflc prolect Contributions reGe¢ved against targ&t Registered Charity Number THE BAY TREE CHARIT BLET UST Pa TRUSTEES, REPORT- 31 DECEMBER 2021 ACTIVITIES, SPECIFIC OBJECTIVES AND RELEVANT POLICIES Icontinuedl Any other rel&vant factors Lellers Should be aeeompanied by a set of the charitable organisation's latest report and full accounts and should be addressed lo.. Tho Bay Tr88 Charilablg Trust P.0. Box 53983 London SW15 1 No applicatlons from individuals are considered. The Iruslees aim lo make grants totalling a minimum of £120,000 per annum in accordance with the guidelines sel out in the grant giving policy above. Oblectlves and actlvltlès for the public b&nefit The trustees confirm that they have refeiied lo the guidance conlainod in the Charity Commission's guidance on PLJblic benefit whèn ieviewing the TIust'S 8irns and objectSv8s and in planning future activities and setting the grant making policy for the year. The Trus( carries out these oblectlves by providing 918nls lo in81ilulions that arg also UK registered charilies. whose objects comply wlth the Trust's criteria. IM)ilst the trLJStees are mindful of their own obligation to ensure that the Trust benefits the public generally, Ihey take some assurance from thé lact that recipients of gran18 are themselves regulated lo ensure that they operate for the public benefit. Potential recipien15 of grants are idenlified by the trustees individually in areas where il is per￿1Ved that public benefit will be achieved. The opportunity lo benefit is not Teslricted in any way except that grants are restricted to bodies registered in the UK, not least to facilitate the Iiuslee5 being able lo follow up on the efficacy of the grants made. In all other respects 9ranls are not limited in any way except that the recipients should have a charitable need. The Iru31ees therefore consider that the Trust's activities are for the benefit of the public generally. Key management The trustees comprise the key management personnel of the charity in charge of directing and ¢onlrolllng, iunning and operating the charity on a day to day basis. All trustees give of their time free5y and no trustee received any remuneration in th$ year. D¢lails of Iiuslees, expenses and remuneialion and any related party transactions are disclosed in note 5 to the accounls. As noted above, th& day oi day managernenl of the charills aclivilies, and the implemenlalion of policies, is delegated to the Private Client Department of Payn6 Hicks Beaeh LLP. Inv•stm8nt policy The charily has a portfollo of Ilsléd investments with a market value as al 31 December 2021 of £7,729,552. HE BAYTREE CHARITABLE TRUST TRUSTEES. EPORT- 31 DECEMBER 2021 ACTIVITIES. SPECIFIC OBJECTIVES AND RELEVANT POLICIES Icontlnuèdl There are no reslriclions on the charily's power Its invest. The Iruslees have insl¥ucted the investment managers lo refrain from purchasing investments in companies connected with armament manufacture tsr di51ribulion. The investment strategy is agreed between the Irust8es and the investment manageis, and 18 regularly reviewed. This is the subjèct of 8 policy slalemenl which has been completed by the Iru81ees and forms an integral part of the agreement with the inve51rnent manager lo provlde inveslmonl management services. The more significanl principles in the stalamènl are.. that the investment manager shall maintain a balance of capltal and income growth which over the long term will endeavour lo m8intain the real value of assets. that the performanco will be reviewed by reference to a customlsèd b8n¢hmaik of 20% FT Government All Stocks. 10¢/o IPD Property, 100/0 Hedge Funds and 60QA FTSE'A, Worfd (Sterling Based). The trustees feol tho portfolio 18 81ructured approximately in Iln8 with the benchrnark. The investment manager Is Invil8d lo allend eac*) formal meeting of the trustees to provld& a report on the performance ol the portfolio. compaii80n against the benchmark and general market issues. The trustees. investment policy was fully updated on 16 December 2013 and reviewed on the 10 October 2019 and required no amendment. ACHIEVEMENTS AND PERFORMANCE Review of activities Total investment income ¥ecelvèd in thg year amounts lo £70.887, which equates to a ySeld of 0.92¢/0 (based on the market valuation of the inveslment agsels al the year endl. The trustees awarded grants totalllng £110,0￿ during the year in accordance with the charity's grant giving policy set out above. A detailed Ilst of a119ranls m8de in Ihe year is induded in the Appendix on paga 24. The trustees fè61 that Iheii objeclive8 have been adequately mel this yfyar. However, the trustees are aware that thère are exleinal facloTS, which could affect the achievomenls of their objectives as a significant part of th9 charity's assets are made up of investments and ¢8sh, Ihfj result of which are dependent on the general pèrforrnance of the UK and overseas stock markets. As noted above under risk management, in order to minimise this, the trustees have set prudent invtsslmenl policies and place reliance on the investment man8ger lo monitor and advise on the necessary invesltnenl changes and 8uilable asset allocation. Thesè action8 have been particularfy relevant given the issu95 arising frorn COVID-19. Investment pèrform4n¢o During the year the charlty's Snveslmenl asset8 achieved an income yield ol 0.920A {b85od on the valuation ol inveslrnenl assets at the year endl and a ¢8pitsl increase of 17%. The investment managèrs eonlinued to invest in accordance with the Iiuslee8' inveslment policy as reviewed and set out earlier In this ieport. Al the end ol the year the charity's portfolio of investments comprised of 2% UK fixed interest stocks. 2% charity and propety funds, 96Yo UK equities and unil trusts. THE BAY TREE CHARITABLE TRUS Pa ES. REPORT- 31 DECEMBER 2021 ACHIEVEMENTS AND PERFORMANCE Icontlnu•dl In view of the current volatility in financial markets. the trustÉ8$ ar8 satisfied with the performance of the investments and are satisfied Ihat their investment objectives will be mel over the medium term. FINANCIAL REVIEW Result8 for the year A summary of ihe yea¢s results can bè found on pago 13 of this report and accounts. Durlng the year ended 31 Decerrber 2021, lolal incorne arnounled lo £104.57512020- £87,157). being income arising from the chaiity's inveslrnenls and cash deposits and donations. Th8 Iruslee8 rnade grants lo 4 instituiions totalling £110,00012020- £150,1lOOI. After accounting for grant administration costs of £12,10012020- £12,150) and the governance costs of £2.352 (2020- £2.3521. this broughl total expenditur& to £124.45212020- £164,502). There wère Investment g8in3 during the year of £1,303,41012020- £461,046). This results in a nel increase in funds during the year of £1.283.53312020- £383,701). Reservès pollcy and flnanclal po$ition Reserves policy The charity is operated as a grant giving charity. and Ihe truslee6' policy is to administer the inveslmènl a55915 on an ab801ule return basis and seek lo distribute approximately £120,000 in each financial year (subject to regLJlar review). Financial posifvon Thè balanc8 Sheet sh¢)ws total funds of £7,692,638. unrestricted fund cornprises amounts which ultimately are fre8 reserv85 bul which ar8 held by the Iruslees for inv831menl so as lo ensure the continued generation of income in fulure periods, thereby helping to safeguard the long term existence of the charity and the achievement of 118 obje¢live8. The size of the unrestricted fund sustains and support5 the levels of don8lions which the Iiuslees wish lo maintain and enhance over time. The trustees consider Iree reserves to be adequate but not excèssive in thè light of the charit￿$ reserve policy Set out above. FUTURE PLANS The Iru81e88 do not anlicipale any significant changes lo the charity or its aclivities over the nexl Iwts lo Ive years. 11 Is their intention lo meet the following objectives., To ensure Ihe inveslmenl performance achieves the criteria set by them so that there arè SLtheSènl funds lo meet their granl giving policies. To continue to make granis at a simllar,11 not hlgher level. In r&spon8e lo the COVID-19 outbreak. the charity is proactively reviewing grant making activilies to ensure continued support lo bènèficio1185. EE LETR USTE S, REPO DECE BE 2021 FUTURE PLANS {contlnuèd) The Iru5tee5 havè r8vlewed the rlsks that COVID-19 p08es to th8 charity and concluded that the charlly Is in a slrong flnancial and op8rational pos511on 8nd can contlnu8 to support ben81iciaflES n¢)w and for the for8sa&8ble fulure. 8tgned on bèhalf of the tTUSt885'. Tru Trusl8e Trusl40 Approved by tho trusto88 on.. 2022 HE BAY TREE CHARITABLE TRUST INDEPENDENT AUDITO EPORT- 31 DECEMBER 2021 INDEPENDENT AUDITOR'S REPORT TO THE TRUSTEES OF THE BAY TREE CHARITABLE TRUST OPINION We have audited the accotjnls of The B8y Tree Charitable Trust Ilhe'charily'l for the year ended 31 December 2021 which comprise the statement of fin8na81 activitiès, th8 balance shfyel, Ihe principal accounting policies and the notes lo the accounts. The financial reporting framework that h88 been applied in Iheir preparation is applicable law and United Kingdom Acctsunling Standards, including Flnancial Rèporting Standard 102'The Financial Reporting Standard applicable in the UK and Republic of Ireland, (United Kingdom Gèn*rally Accepted Accounting Practice). In our opinion, the accounts.. give a true and la1rvi￿ of th& slate of the charilYs affairs as al 31 December 2021 and of its income and expenditure for the year then ended.. have been properly prepared in accordance with United Kingdom Genoially Accoplod Accokjnllng Pr8¢lice.' and have been prepared in accordance wtth the requirements of the Charfties Act 2011. BASIS FOR OPINION Wè ¢onducled our audit in accordance with International Standards on Auditing IUKI IISAS IUKII and applicablè law. Our Tesponsibililies under those standards are further described in the avdilorfs responsibilities for the audit of the accounts section of our report. We are independent of the charity in accordance with tho olhical Tequir8menls that are relevant lo our audit of the accounts in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in a¢¢ordan¢s with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate lo provSde a basis for our opinion. CONCLUSIONS RELATING TO GOING CONCERN In audlllng the a¢¢ounl8, we have conduded that the Iruslees, use of the going concem basis ol accountlng In the preparallon of tho accounts 1$ appropriate. Based on the work we have perfomied, wè hav6 not Identified any matèrial uncertsinlies relating lo ovonls or conditions that, individually or collectively, may cast significant doubl on the charity's ability io continue as a going COn￿M for a period of al least twelve months from when thè a￿)UnIS are aulhori8ed for i8sue. Our rosponsibililies and the responsibilities of the twstees with respect to going concern are described in the relevant sections of this report. OTHER INFORMATION The trustees are responsible lor thè other inforrnation. The other information comprises the Information included in tho annual report and accounts, other than the accounts and our audito¢s report thereon. Our opinion on the a￿UnIS dogs not cover th8 other information and we do not 6xpr8ss any lorrn of assurance conclusion thereon. EE CHARITABLE TRUST INDEPENDENT AUDITOR'S REPO 1 DECEMBER 2021 INDEPENDENT AUDITOR'S REPORT TO THE TRUSTEES OF THE BAY TREE CHARITABLE TRUST OTHER INFORMATION Iconllnuedl In connection wilh our audit of the accounts, our responsibility Is to rèad thè olher inforrnalion and, in doing so. ctsnslder whelhgr the other information is materially inconsistent with the aceounts or our knowledge obtained in the audit or otheNise appea15 to be m8leiially rnisslaled. If we identify such material inconsislÉnci88 or apparent material misstatements. we are required lo deleimine whether there is a material misstatement in the accotjnts or 8 molerial misstatement of the other information. If, based on the work we have performed, we condude that Ihere 18 a material misstatement of this other information. we 8re roquiied to report that fact. We have nothing to report In thSs regard. MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION We have nothing to reptsrt in respecl ol Ihg following rnallers in relation to which the Charilios Act 2011 requires us lo report to you if, in our opinion-. tho infoTmalion given in the trustees, report is inconsistent in any material respect wSlh the accounts-, or sufficient aeeounlSng ￿e0rd5 have not been kept,. or the accounts are not in agraèménl with Ihe accounting records and returns,. or we have not received all the information and explanations we require for our audit. RESPONSIBILITIES OF TRUSTEES As explained morè fully in the InEslee8' Tesponsibililies slalemenl, the Iruslees are responsible for the preparation of the accounts and for being satisfied that they give 8 true and fair view, and for such intemal control as the IIu51ee5 deleirnine is necessary lo ellable the prop8ralioTr of accounts Ihat are free from material misstalement, whelher due to fraud or error. In preparing the accounts. the Iruslees are responsible for assessing the charity's ability to continue as a going concern, disclosing, as 8ppli¢able, mattels ielaled lo going concem and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to ￿ase operations. or have no realisllc allernalive bul to do so. AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE ACCOUNTS Our objectives are to obtain reasonable assurance about whether the accounts as a whole are free from materlal misstalemenl, whether due lo fraud (x error. 8nd lo issue an audilorfs report that includes our opinion. Reasonable assurance is a high level of assurance. but 1$ not a guarantee that an audit conducted in accoidance with ISAS IUK) will always delecl a material mi5Stalernenl when il exi818. Misslatemenls can arise from fraud or error and are considered material if. individu8lly or in the aggregate, they could reasonably be expected lo influence the economic decisions ol users taken on the basis ol these accounts. Irregul8ri1ies, including fraud, are instances of non-complian￿ wllh laws and regulations. We design procedures in line with our rè5ponsibili11g8, outlined above, lo delecl material misstatements in respect of irreguSarities, including fraud. The exlenl lo whi(* our procedures ale capable of delecling irregularities, including fraud is detailed below. THE BAY TREE CHARITABLE TRU Pa e 11 INOE ENDEN OR'S REPORT- 31 DECEMBER 2(Y21 INDEPENDENT AUDITOR'S REPORTTO THE TRUSTEES OF THE BAY TREE CHARITABLE TRUST AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE ACCOUNTS Icontlnuodl Our approach to identifying and assessing the risks of material misstatement in respeet ol irregularities, including fraud and non-¢ompliance wilh laws and regulations, was as follows.. Wè en8ured that the engagement team collecllvely had the appropri8te comp6t8nc6. capabilities and skills lo Identify lx recognise non-compliance with applicable laws and regulations,. W& obtained an understanding ol the legal and regulatory frameworks that are applicabl& lo the charity and determined that the most significant ffameworks which are directly relevant to specific assertions in Ihe financial statements are those that ralalè lo the rèporting framework Istatemenl of Rewrnrnended Practice.. Accounting and Reporting by Charities preparing their accounts in accordance wlth the Financial Reporting Standard applicablo in the United Kingdom and Republic of Ireland IFRS 1021 and the Charities Act 2011} and those that relate to data protection (General Data Prole¢lion R&gulalionl. We idenlilied laws and regulations were communicated within the audit team regularly and the team remained alert to inslances of non-compllance throughout the audit. We assessed tho 5usceplibilily of the charity's financial stalemenls to material misstalement. including obtaining an understsnding of how fraud rnighl occur, by.. Making enquiries of Ihe charity's administrators as to theSr knowledge of actual. suspected 8nd 811è98d fraud., and Con8idering the inlemal controls in pla￿ to mitigate risks of fraud and non-compllancè with18ws and regulations. To address the risk of fraud th¥ouoh management bias and ovèrrido of ctsnlrol8, We.. Perfofmed analytical procedures lo identify any unusual or unexpected relatSonshSps'. Assessed whether judgemènts 8nd 8ssurnptions made in delerrnining th8 accounting eslimales were indicative of potential bias.. Tested auihorisatlon conliol8 on expenditure ilerns, ensuring all expenditure was approved in line with the charily's finanaal procedu￿., and Performed subslanllve lesung on grant 8xpendilure lo evidence of grant approval and distribution. In response lo the risk of irregularities and non-complSan¢e with laws and reyulalions, we designed wo¢8dures which included. bul were not limited to.. Agreeing financAal statement disclosurès to und8rlying supporting docurnenlalion; Reading the minutes of meetings oflhose charged with govemance,. and EnqLtiring of the charSty's admini51ralor8 as to actual and potenlial litigation and claims. THE BAYTREE ARITABLE TRUST Pa e12 DEPENDENT AUDITOR'S REPORT- 31 DECEMBER 2 INDEPENDENT AUDITOR'S REPORT TOTHETRUSTEES OF THE BAY TREE CHARITABLE TRUST AUDITOR'S RESPONSIBILITIES FOR THE AUDITOFTHE ACCOUNTS IContlnu•dl Th618 are inherent limitations in our audit procedures described above. The more removed th81 laws and règulations are from finanrial transactions. (he less likely il is that we would become aware of non-compliancè. Auditing standards also limit the audit procedures required lo identify non-compliance with laws and regulations to énquiry of the Iruslees and administrators and the inspection of regulatory and legal correspondence, il any. Material misstatements that ari$6 dug 10 fraud ran be harder lo delect than th￿ thal arise from error as they may involve deliberate concealment or collusion. A further descrfpllon Of our responsibilities for the audit of the accounls is localed on the Finanaal Reporting Council's website al W￿￿.fr¢.0rg.Uk1aud1loTSresF￿nSIbIIi1IeS. This de8ciiplion forms part ol our audito¢s report. USE OF OUR REPORT This report is made solely lo tho ¢hariV8 IIu8lee¥, a8 a body, in accordance with section 145 of the Charities Act 2011 and with regulations made under section 154 01 that Ad. Our oudil work h8$ been undertaken so that we might state to the charity's trustees those matters we are reqUIr￿ to 513le lo them in an auditorfs report and for no other purpose. To the fullest extent permitted by law. we do not accèpt or 888ume responsibility lo anyone other than the charity and the charity's trusteès as a body, for QUT audit work, for this report, or for the opinions we have fomied. Buzzacolt LLP Slalutory Auditor 130 Wood Str8el London EC2V6DL Date: 31 October 2022 Buzzacotl LLP is eligible lo act as an auditor in terms of Section 1212 of Ihe Companies Act 2006. THE BAYTREE C ABLE TRUST Pa e13 STATEMENT OF FINANCIAL ACTIVITIE THE YEAR ENDED 31 DECEMBER 2021 Total Total 2021 INCOME FROM.. Investments Investment Income Interest receivable Donations Tax repayment supplement 87,059 74 70.887 33.688 24 87,157 TOTAL INCOME 104,575 EXPENDITURE ON.. Charitable activllies Promoting and enhanang tharilable work 184,502 124,452 164,502 TOTAL EXPENDITURE 124,452 NET EXPENDITURE BEFORE INVESTMENT {LOSSESI 177.3451 {19,877) Investment gain￿00&59s) Reallsed Unrealised {9.63SI 470,681 1.303.410 383,707 NET INCOME AND NET MOVEMENT IN FUNDS 1,283.533 RECONCILIATION OF FUNDS Total funds brought forward at 151 January 2021 6,025.404 6.409.105 Total funds carried forward at 31st Decemb6r 2021 6,409,105 7,692.638 All recognised gains 8nd10$5es ar8 induded in the above slalement of finanaal activitles. All of thè charity's aclivilies derived from continuing operations during tho above financial years. TH E CHARIT B us CE SHE MBE 020 2021 FIXE 8,426,142 LtBled Inveslm8nts 7,72Q,SS2 cu Oeblors Cash at bank and in hand 6,760 141,824 93.501 93,585 Tolal ¢urr6nt asset$ 148,584 Crodltors.. Amounts falling due wtthln onè yaar 1110,e021 10 1185,4981 {17,0371 LITI (36,9141 8,409,105 NET 7,892.838 NDSOFT ECH RITY Unrastrlcted Incom¢ Fund5 Genèral Fund 6.409.105 7.692,638 Approv8d by tho trus1g8$ and stunfrd on thelr be￿11 by.. tee Tfu$l09 Tnjstee D819 of Apprgval.. ..29..-.....OJ..¢.&r.....2022 THE BAY TREE CHARITABLE TR Pa e15 PRINCIPALACCOUNTING POLICIES- 310ECEM8ER 2021 The prlnclpal accounting policies adopted, judgements and key sources of estimation uncertainty in Ihe preparation of the 8ceoLJnl$ 8re laid out below. Basls Of prgparatlon These accounts have been preparèd for the year lo 31st De￿mber 2021 with comparative information presented in respect lo Ihe year to 31st December 2020. The accounts have been prepared under the historical cost convention with items recognised at cost orlransaction value unless olhemise stated in the rel&vanl accounting policies below or the notes of those accounts. The accounts have been prepared in accord8n¢è with Accounting and Reporting by Charities.. Slalement of Recommended Reporting Pracllcè applicablè to charities preparing their accounts in ccordancg with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (Charities SORP FRS 1021, second edition (October 20191 the Financial Reporting Standard applicable In th8 UK 8nd Republic of Ireland IFRS 1021 and the Charities Act 2011. The charity conslilules a public benefit entkty as defined by FRS 102. The accounts are presented in steding and are rounded to th¢ nearesl pound. Critical arcounting eBtimateB and areas of judgement Preparation ol the accounts requires the trustees to make slgnifieantludg8mantS and estimates. The items in Ihg arLounls where Ihese judgements and eslimales have been made indude.. estimating the liability for multi-year grant commitments. estimating future Sn¢ome and &xp&ndilure flows for the purp08e of assessing going concem {6ee below). Assessment of golng eoncem The Iruslee8 have assessed whether the use of the going concern assumption is appropriate in preparing Ihe8e accoun18. The IFuslees have made this assessment in respect lo a period of one year from the date of approval of these ocwunls. The trustees of the ¢h8rily have concluded that there are no materia5 uncertainties related to events or conditions Ihat may cast significant doubt on the abillty of tho eharily lo ¢onlinue as 8 going conc810. The full impact following the recent emergence of the global coronavirus pandemic Is still unknown. Thei8fore, il is not possible lo evaluate currently all the potential implications for the charity's activitles. b8n8fici8ries and the wider economy. Eslimales used in the accounts, P8rticularly with respect to the impacl on future incomè and expénditure flows are subjed to a greater degree of uncétsinly and volalilily. As set out in these accounting policies under °going COn￿rn. the tru51ees havg considered the impact of the pandemic on the charily and have concluded that although there may be some negative Gonsoquences, il is 8ppropriale for the eharily lo continue lo prepare its accounts on the going concern basis. The Iiustees are of THE BAY TREE CHARITABLE TRUST Pa e18 PRINCIPALAC POLICIES- 31 DECEMBER 2021 Asse85rnent of golng concern Icontlnuedl the opinion that the charity will have 8ufficienl resour￿$ lo meet its liabilities as they fall due and therefore there are no concerns regarding th& charity'5 8bilily lo continue as a going concern. The most significant areas oljudgemenl that affect items in th& 8ecount 81e detailed above. Wlh rega¥d to the next accounting period, the year ending 31 December 2021. Ihe most significant areas that affect the carrying value of th& as8els held by th8 charity are the level of inveslmenl return and the perf0rrnan￿ of the investment markets (see the investment policy and Ihg 118k management sg¢lions ol the Iw8lees' report for more information). Income recognition Incorne is recognised in the perfod in which th8 ch81ily h88 enlillemenl to the income. Ihe mount of income can be measured reliably and it Is probable that Ihg income will be received. Income comprises donations, Investrnont income frorn inveslmenls and inleresl from deposits. Donations are recognised when the charity has confirmation of both the amount and $ettletnent dale and include related Gift Aid tax reclaims. Dividends are recognised once the dlvSdend has been doclared and nolilicalion ha8 been received of the dividend due. Interest on fund5 held on dop0811 is included when re￿1vable and the amount can be measured reliably by the charily.. Ihis is normally upon nolilicalion ol the inleiest paid or payable by Ihe bank. Expènditure recognition Liabilities are recognised as expendllure as 500n as IheTe is a leg81 or con81wclive obligalion commilling the charity to make a payment to a third patly, 11 Is probable that a transfer of economic benefits wlll bè rèquired in 8elllemenl and the amount of the obligations can be measured reliably. All expendiluro is accounted for on an accruals basis. Expenditure comprises direct costs and support cosls. All expenses, indudlng support costs. are allocated 01 apportioned lo the applicable gxpendilure headings. The classification between the activities is as follows.. lal Expendilure on raising funds includes all expendllure assoclaled wllh raislny funds for Ihg charity. This includes the lees paid to Ihe investment manager Sn connection wlth the managèmènt of th6 ¢h8ritys listed inveslrnenl8. Ibl Expenditure on charitable activities indudes all costs associated with furthering thè haTil8ble purposes of the charity through the provision ol its charitable activities. Such costs include charitable gfanls payable in promoting and enhancing charitable work carried out by other charitable organisations, and rolaled sUPPQrt cos18 including the ¢osl of administering the activities of the charity and governance costs. Grants payable are included in the statement ol flnanclal activities when approved 8nd when the int6nded 18cipienl has either re￿iVed the funds or been informed of the decislon to make the donation and has satisfied all I618ted conditions. Grants approved bul not paid al the end of the rinancial year are accrued for. Grants where the beneficiary has not bèan Inforrn8d or ha819 meet certain conditions before the grant is released are not accrued for but are noted a financial commitments in the notes to the account8. All expenditure Is slated In¢lusive of irrecoverable VAT. THE BAY TREE CHARITABLE TRUST Pa e17 PRINCIPAL ACCOUNTING POLICIES- 31 DECEMBER 2021 Alloeatlon of 8UPPOrt and governance costs Support costs represent indirect chaiilable expendiluia. In order Io c8rry out the primary purposes of the charity il is necessary to provide support in the fomi of administration services. Governance costs comprise the costs involving the public ￿￿OuNtablI1lY of the charity (including audit costs) and costs in ￿spect ol its complianc& with 18gulalion and good practi￿. Support ¢0sts and govornance costs are apportioned directly to Ihe one charitable activity. Flxed asset Investments Fixed asset investments arè includÈd on thè balance sheet al their rnarkel value al the end of the financial period. Realised and unreallsed gains lor lossès) 8r8 ¢r&d*l8d lor debil8dl, lo the slalemenl of financial activities in the year in which they arise. Listed investments are a fom of basic financial insliumenl and are initially recognised al their transaction value and subsequently measured at their fair value as at the balanee sheet date using Ihe closing quoted market price. The charlly does not acquire pul options, derivatives or other complex financial instruments. As noted ab￿ the m8in form of financial risk faced by tre charity is that a volalilily in equity markets and investm6nt maikèts duè lo wider economic conditions, the allilude of inv8slor5 10 investment risk. and changes in sentimenl concerning equities and wathin particular sectors or sub sector8. Realised galns {or losses) on inve$lmenl asset8 aig calculated as the difference beiween disposal proceeds and their opening carrying value or their purchase value 15 acquired subsequent to the firsl day of the financial year. Unrealised gains and losses are calculated as the dlffei¢n¢o btslwatsn the fair value al the year end and their carrying value al Ihal dale. Realised and unrealised inveslmonl gains lor1055981 ale Credited {or debiledl lo the slalemenl of financial activities in the year in which they arise. Debtors Debtor5 are rewgnised al their setllernenl amount, less any provision for non-recoverability. They have been discounted lo the present value of the future cash receipt where such discounting is material. Cash In bank and In hand Cash 81 bank 8nd in hand represents such accounts and instruments that are available on demand or h8v6 8 maturtly of less than three months from the dale of acquisition. Coneè88ionary loan$ Concessionary loans initially recognlse and measure the loans al the amount ieceived or paid. with the carrying amount adjusted in subsequent years to reflect repayments and any aecrued interest. Cr•dltors and provl8ion8 Creditors and provisions ar& r&cognlsed ¥vhen thor61s an oblig81ion al the balarTh 8heel dale as a result of 8 past event, il is probable that a transfer of economic benefit will be required in selllement, and the amount of Ihg selllemenl can be e81irnaled reliably. Creditors and provisions are recognised at the amount the charity anlicip8les il will pay Io 8ellle the debt. They have been discountèd to tho present value of the fulufe cash payment where such discountlng Is materlal. THE BAY TREE GHARITABLE TRUST Pa e18 PRINCIPALACCOUNTING POLICIES- 31 DECEMBE 202 Fund ac¢ountlng The general fund represent funds available foi the general charitsblg purposes gf the harily whiGh m8y be applied al the discretion of the ITUStees. cash flow The accounts do not includ6 a c85h flow slalemenl because the charity is exempl from the requirement to prepare such a statemanl und8r tha Charities SORP IFRS 1021. THE BAY TREE CHARITABLE TRUST e19 NOTES TO THE ACCOUNTS- 31 DECEMBER 2021 I INVESTMENT INCOME 2020 2021 68,284 UK equities and unit trusts 12,872 UK Govemmenl and fixed interest securities 3,276 Overseas 6,283 Charity and property funds 13,6561 Gi118 accrued interest 62,733 5,210 2.986 1421 87.059 70,887 2 DONATIONS 2020 2021 Gift Ald donation Isee r￿le 51 Tax repayment 26.950 6.738 33.688 3 PROMOTING AND ENHANCING CHARITABLE WORK 2020 2021 150,000 Grants P8yablg to inslilulions 12,150 Grant administration costs 2,352 Governance cosls (see note 41 110.000 12,100 2.352 164,502 124.452 A detailed list of the grants Pay8blè lo institutions is given in the Appendix Ipage 241 lo these ounls. THE BAY TREE CHARITABLE TRUST Pa e20 NOTES TO THE ACCOUNTS- 31 DECEMBER 2Q21 3 PROMOTING AND ENHANCING CHARITABLE WORK Icontinuedl A reconciliation of the grants payable and grant cornmilrnenls figures shown in these accounts is as follows.. 2020 2021 Grant commitments al 1st January 2021 t50.0(Xl Grants agreed during the year 110,000 150,000 Grants payable 1150,0001 Grants paid during the year 110,000 110,0001 Grant comnNlments at 31st December 2021 100,000 4 GOVERNANCE COSTS 2020 2021 2.352 Statutory audit fe& 2,352 2,352 2,352 STAFF COSTS AND TRUSTEES, REMUNERATION The charity employed no staff during the year12020. None). No trustee received any remuneration in respect of their services durlng the year {2020- £nill. The key managetnenl por89nnel of the chaiily in chargg of directing 3fKI conliolling, the charity comprise the trustees. Thè lolal rsmungrallon lincludlng taxable benefits bul excluding employerf8 pension ¢onlribulionsl of Ihe key managemenl personnel for the year was £nil12020- £nlll. During the year, the selllor who is a dose lamily relative of the trustees agreed to make a gift aid donation lo the charity of £26,95012020- £01 (see note 21. 6 TAXATION The Bay Tree Chafilable Trust is a registered charity and. therefore, is not liable to income tax or corporation lax on income or gains derived from its charitable activities as they fall within the exemptions available to reglstered chaiilie8. THE BAY TREE CHARITABLE TRUST Pa e21 NOTES TO THE ACCOUNTS - 31 DECEMBER 2021 7 INVESTMENTS 2020 2021 USTED INVESTMENTS Movements in listed Investments during tho year were as follows.. 6,032,49D Market value at Isl Janu8ry 2021 8.426,142 276,300 Additions al cost {353.3291 Disposals at book valu¢ (proceeds.. £0., loss £0) 470.681 Net unrealised Ilossèsygains in year 1,303,410 6.426.142 Market v8luo al 31st December 2021 7,729.552 2,578,401 Cost of listed investments 31st De￿mber 2021 2,578.401 All investments were dealt Sn on a rg¢0gnis8d stock exchange.. 2020 2021 Listed investments held at 31st December 2021 comprise the following investment all listed on a UK stock exchange.. 5,655,936 620,510 149,696 UK equities and unit trusts UK govémmenl and fixed interest securities Charity and property funds 6,981,546 $84,014 163,992 6,426,142 7,729,552 At 31st December 2021 Ihg following individual holdings had a market value in excess of Svo of the entire portfolits.. Yoof rtfolio Value Smith & Williamson Bay Fund Income Units 90% 6,981.546 Isha￿SlI PIC Core UK Gilts UCITS ETF GBP Oisl 375.705 THE BAY TREE CHARITABLE TRUST NOTES TO THE ACCOUNTS- 31 DECEMBER 2021 B DEBTORS 2020 2021 Tax Tepaymenl 6.738 64 Gilts accrued interest 22 6,760 9 CASH AT BANK AND IN HAND 2020 2021 81,877 auiller Cheviol 11,624 PHB Client Aceounl 141,824 93,501 141,824 10 CREDITORS.. AMOUNTS FALLING DUE WITHIN ONE YEAR 2020 2021 4.650 Gr8nl 8dminlslr8llon costs 2.352 Stalutory audit fee Prior ygar 8udil fee yel lo be paid 103.600 Loan from Settlor Donations 4,144 2,352 2,352 7fj,650 100,000 110.602 185,498 THE BAYTREE CH ITABLE TRUST NOTES TO THE ACCOUNTS- 31 DECEMBER 2021 11 UNREALISED GAINS Unrealise