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2020-12-31-accounts

47-58 Bastwick Street, London EC1V 3PS, United Kingdom T +44 (0)20 7235 4535 E benfund@istructe.org www.istructe.org

Benevolent Fund

Report and Financial Statements

for the year ended 31 December 2020

A company limited by guarantee No. 3087463 Registered with the Charity Commission for England and Wales No. 1049171 Regulated by the Financial Conduct Authority FRN 718626

Benevolent Fund

TRUSTEE-DIRECTORS 2020

J M Allen BSc(Hons) CEng FIStructE MICE Chairman I G Hill BEng(Hons) CEng FIStructE MICE F J McGlade BSc CEng FIStructE MICE J D Parsons BSc(Hons) CEng FIStructE MICE Vice-Chairman Dr J M Roberts FREng BEng(Hons) PhD CEng FIStructE FICE M F Ryland BSc(Hons) CEng FIStructE MICE N Westwood BSc(Eng) CEng MIStructE FConsE N C Wheeler BSc(Hons) CEng MIStructE MICE

ADVISORY COUNCIL 2020

N Ball BSc CEng MIStructE MICE

Vacancy B Hipwell BEng(Hons) CEng MIStructE FConsE J M Allen BSc(Hons) CEng FIStructE MICE I G Hill BEng(Hons) CEng FIStructE MICE A K Strong CEng FIStructE MICE MCIArb FIHT MCMI C Higgins CEng MIStructE F J McGlade BSc CEng FIStructE MICE M F Ryland BSc(Hons) CEng FIStructE MICE Mr J G Dunny BEng Tech IEng, AMIStructE, MIEI A Massie BSc(Eng) CEng MIStructE ACIArb Mr J W Bunce DIC, CEng, FIStructE, FRINA N J Groves BSc(Hons) MSc CEng MIStructE MCMI N Westwood BSc(Eng) CEng MIStructE FConsE L M P Chong BSc(Hons) MSc CEng Peng FIStructE MICE MCIHT J D Parsons BSc(Hons) CEng FIStructE MICE S B Holmes CEng MIStructE N C Wheeler BSc(Hons) CEng MIStructE MICE

Bedfordshire & Adjoining Counties Regional Group Devon & Cornwall Regional Group East Anglian Regional Group East Midlands Regional Group Lancashire & Cheshire Regional Group Midland Counties Regional Group Northern Counties Regional Group Northern Ireland Regional Group North Thames Regional Group Republic of Ireland Group Scottish Regional Group South Eastern Regional Group Southern Regional Group Surrey Regional Group Thames Valley Regional Group Wales Regional Group Western Counties Regional Group Yorkshire Regional Group

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Benevolent Fund

SECRETARY

Dr K MacDonald Bsc(Hons) PhD CSci CChem MRSC

BENEFITS CONSULTANT

C Pedroza, 53 Ryde Road, Brighton BN2 3EG

AUDITORS

Haysmacintyre LLP, 10 Queen Street Place, London EC4R 1AG

BANKERS

National Westminster Bank plc, Victoria (A) Branch, PO Box 1357, 169 Victoria Street, London SW1E 5NA

INVESTMENT MANAGERS

W H Ireland Ltd, 24 Martin Lane, London EC4R 0DR

SOLICITORS

Withers LLP, 16 Old Bailey, London EC4M 7EG

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT

31 DECEMBER 2020

1 INTRODUCTION

The Trustee-Directors present their report and the financial statements of the Institution of Structural Engineers Benevolent Fund for the year ended 31 December 2020. The accounts which are attached to this report comply with current statutory requirements, the requirements of the Benevolent Fund’s articles of association, and with the requirements of ‘Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102 – Second Edition)’.

2 REFERENCE AND ADMINISTRATIVE INFORMATION

The Institution of Structural Engineers Benevolent Fund is constituted as a company limited by guarantee incorporated in England & Wales under registered number 3087463 and is governed by its articles of association.

The Benevolent Fund is registered with the Charity Commission for England & Wales, under registered number 1049171 and is regulated by the Financial Conduct Authority under FRN 718626.

The registered office of the Benevolent Fund is 47-58 Bastwick Street, London EC1V 3PS.

The names of the Trustee-Directors who served during the period are set out on page 1; all remained in office at the date of the approval of this report. No material contracts subsisted during the period in which any Trustee-Director had an interest.

The names of the Secretary and of the principal professional advisers to the Benevolent Fund are set out on page 2.

3 ORGANISATIONAL STRUCTURE, GOVERNANCE AND MANAGEMENT

Constitution

The Benevolent Fund was established in 1936 as an unincorporated association and in 1941 it obtained registration as a friendly society. With the agreement of its members, as well as the relevant statutory authorities, on 2 August 1995 it was incorporated as a company limited by guarantee and on 13 September 1995 it was reregistered as a charity. The Benevolent Fund’s governing document is its articles of association (which were amended by special resolution on 19 July 2018), under which the Trustee-Directors have made rules for the management of the Benevolent Fund.

Trustee-Directors

The Benevolent Fund’s articles of association provide that there shall be at least three TrusteeDirectors. Trustee-Directors are appointed, for three-year terms, at general meetings of the Benevolent Fund, although the Trustee-Directors themselves may also make appointments for one year. Subject to the Benevolent Fund’s articles of association, all decisions are taken by the TrusteeDirectors (although the Chairman, with one other Trustee-Director, has limited delegated power to approve emergency grants). On appointment, each Trustee-Director receives an information pack, which, in addition to details about the Benevolent Fund, contains information relating to the roles of trustee and company director; this pack is updated as required.

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

Advisory Council

The articles of association provide for there to be an Advisory Council of representatives of regional groups of the Institution of Structural Engineers: this Council has been established, comprising delegates from 18 of the UK/Republic of Ireland regional groups. The names of the Advisory Council members are given on page 1. As well as visiting applicants and beneficiaries and attending meetings of the Trustee-Directors, the Advisory Council members also contact widows/widowers of members and other potential beneficiaries, undertake local publicity on behalf of the Benevolent Fund and encourage contributions. Neither the Advisory Council members, nor the Trustee-Directors or anyone else acting on behalf of the Benevolent Fund (other than the principal advisers), receives any payment apart from out-of-pocket expenses.

Sub-committees

The articles of association authorise the Trustee-Directors to appoint sub-committees. The only subcommittee appointed in 2020 was the Investments Sub-Committee, comprising Mr J M Allen, Mr J D Parsons and Mr I G Hill.

Relationships with other organisations

The Benevolent Fund is deemed a connected charity to the Institution of Structural Engineers as its objects are to provide benefit to members of the Institution, and to former members and dependants of members, who are in need (See Section 4) and as it benefits from administrative services provided by the Institution. The affairs of the Benevolent Fund are conducted from the Institution’s offices and the secretariat is provided by the Institution.

Wherever possible, the Benevolent Fund co-operates with other charities in relation to applicants and beneficiaries. The list of grants on page 22 shows joint beneficiaries of the Institution Structural Engineers and the Institution of Civil Engineers Benevolent Funds. The Benevolent Fund is a member of the Association of Charitable Organisations.

Risk

The Trustee-Directors oversee an ongoing assessment of the major risks to which the Benevolent Fund is exposed, in particular those relating to its operations and finances, and are satisfied that systems are in place to manage the Benevolent Fund’s exposure to those risks. The most significant risk is the long-term fall in the value of the Benevolent Fund’s investments, but these are kept under constant review by the Investment Managers and are monitored by the Investments Sub-Committee regularly. Further information pertaining to the impact of the Covid-19 pandemic on the Fund’s income/investments, expenditure and cash flow may be found under Section 5 Financial Review. Another risk is the unexpected loss of the Secretary, a comprehensive procedural manual is regularly updated for use by the Secretary and any alternative support cover should the Secretary not be able, for any reason, to meet the responsibilities of the role.

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

4 OBJECTS, ACTIVITIES AND ACHIEVEMENTS

Objects

The Benevolent Fund's objects are the prevention or relief of poverty or financial hardship of, and the relief of sickness and the preservation of health among, current or former members of the Institution and their dependents or former dependents, including, but not limited to, the provision of financial assistance, support, education and practical advice.

The fulfilment of these objects is clearly of public benefit.

Vision

The vision of the Benevolent Fund is to enable the Institution of Structural Engineers to care for its members, former members and their dependants, in time of need.

Public Benefit

The Trustee-Directors are satisfied that the aims of the Fund are carried out wholly in pursuit of its charitable aims. Members and non-Institution members benefit from receiving financial assistance in times of need.

The Trustee-Directors have regard to guidance on public benefit published by the Charity Commission, when exercising their powers and duties and where such guidance is relevant. The Trustees have considered the Charity Commission’s general guidance on public benefit and have taken it into account when reviewing the Funds’ aims and objectives and in planning its future activities.

Activities and achievements

The Benevolent Fund’s principal activity during the year was the administration of funds held for charitable purposes.

There is no geographical restriction relating to beneficiaries, and the Benevolent Fund assists members and their dependants both within and beyond the United Kingdom.

The Trustee-Director’s objective for 2020 was to assist between 15 and 30 Institution members, former members and their dependents. During the year the Benevolent Fund helped 21 individuals and distributed £115,161 in grants which enabled them to meet day to day living expenses or specific items of expenditure. A summary of grants paid is given on page 22. Whenever possible, a representative of the Benevolent Fund visits or makes contact with an applicant to establish a personal link with the Benevolent Fund and to make an independent appraisal of the circumstances to guide the Trustee-Directors in their assessment of need: the Trustee-Directors are grateful to those who undertake this important and sensitive role.

Many members of the Institution, and some firms, support the Benevolent Fund by regular contributions. Some considerately remember the Benevolent Fund in their will. Regional Groups of the Institution also support the Benevolent Fund through fund-raising at events. The Trustee-Directors are most grateful for the generous support of the Benevolent Fund by all concerned.

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

The Trustee-Directors have formulated a strategic plan, and also policies and procedures for the administration of the Benevolent Fund and its assets and for grant-making. These are kept under review.

5 FINANCIAL REVIEW

Trustee-Directors’ responsibilities

The Trustee-Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Trustee-Directors to prepare financial statements for each financial year. In accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), under company law the Trustee-Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources of the charity for that period. In preparing these financial statements, the Trustee-Directors are required to:

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

This Trustee-Directors’ report has been prepared in accordance with the provisions applicable to companies entitled to the small companies’ exemption.

Financial statements are published on the charity’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the charity's website is the responsibility of the Trustee-Directors. The Trustees-Directors’ responsibility also extends to the ongoing integrity of the financial statements contained therein.

Auditors

All of the Trustee-Directors as at the date of this report have taken all the steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information. The Trustee-Directors are not aware of any relevant audit information of which the charity’s auditors are unaware.

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

Review of the year

The Benevolent Fund’s income in the period comprised donations and legacies of £39,001 (2019: £46,299) and investment income of £34,932 (2019: £123,280), a total of £73,933 (2019: £169,579). The overall income was 56% lower than in 2019. Grants made, including support costs, totalled £140,886 (2019: £119,552) and cost of raising funds with support costs were £24,007 (2019: £24,400), realising an operational deficit of £90,960 (2019: an operating surplus of £25,627). The value of the Benevolent Fund at the year-end was £1,654,462 (2019: £2,766,190). This mainly comprised investments held to generate income for the payment of grants.

Due to the uncertainty caused by the Covid-19 pandemic, the Trustee-Directors have reviewed the resilience of the Benevolent Fund to continue to fulfil is charitable objects and to meet its targets over the next 12 months. Four key measures have been assessed to determine the Fund’s ability to continue as a “going concern” namely, the value of investments, income, expenditure, and cash flow. Based on a reforecast of the likely activity in each of these areas the Trustee-Directors are satisfied that the Fund continues to meet the ‘going concern’ definition. As the investment portfolio is made up of approximately 33% of shares in the banking and financial sectors it should be easier to convert these to cash. A more detailed assessment of the situation is given below with its likely impact.

Investment policy and performance

As the majority of the Benevolent Fund’s investments are in listed securities, their market value (which is the figure used in the balance sheet) varies according to stock market conditions. At 31 December 2020 the market value of the investments stood at £1,643,781, made up of listed investments of £1,629,127 and cash deposits of £14,654. £716,588 below their historical cost of £2,360,369. Because of the ongoing uncertainty caused by the Covid-19 pandemic the Trustee-Directors requested a current valuation of the investment portfolio. On 17[th] March 2021 the value of the portfolio stood at £2,001,390. This represents a gain of 31% from its lowest value of £1,167,556 in 2020. The Trustee-Directors have received confirmation from the portfolio fund manager that the Fund’s Investment Policy and current investments remain appropriate. The expert advice is that there is no reason why the worst-hit sectors will not recover post Covid-19, although it remains unclear how long this may take. The Trustee-Directors remain confident that the Fund’s Investment Policy remains appropriate to fulfil its objective of long-term growth.

The investments chosen by the investment managers include 33% in the banking and financial services sectors, with the remainder split between travel/leisure and other sectors. Due to Covid-19 the share values of the investments across all sectors have decreased significantly. However, based on the most recent valuation of £2,001,390 in March 2021 there is still enough liquidity within the portfolio to fund additional demands on resources should they be required in the next 12 months. At the end of December 2020 there was £14,654 in cash within the portfolio.

Income

Income is derived from two principal sources, firstly investments and secondly donations and legacies. Investment income in 2020 was £34,932 representing a decrease of 72% over 2019 levels. Donations and legacies in 2020 were £39,001, 16% lower than the 2019 figure of £46,299.

The Trustee-Directors have reviewed investment income for 2021 and have been assured that the dividend income from the investments will be significantly higher than in 2020. The current estimate is £61,000.

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Benevolent Fund

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

Donation income is unlikely to be significantly affected by Covid-19 and much of the donations for 2021 (£35,304) have already been received as at 28.02.2021. Furthermore, donations to the Fund tend to be resilient in times of recession – as evidenced in 2009 and 2010 when the average donation over the two years remained at £36,424.

Expenditure

The major part of expenditure represents grants to beneficiaries. The total varies each year, and in 2020 grant expenditure was £140,886, 18% higher than 2019, with costs of raising funds amounting to £24,007, which included investment costs of £16,544.

No commitment to payments is made beyond a 12-month period and other than the grant, support and governance costs stated above the Fund has no overheads or financial commitments. However, the Trustee-Directors have assumed that applications to the Fund will remain unchanged through the remainder of 2021 and into 2022 and have reforecast expenditure to be £168,000.

Cash Flow

Cash, cash equivalents and cash held with investment managers at the end of 2020 was £43,048 (see note 13). Combined with the reforecast of income to May 2022 of £96,000 and reforecast expenditure of £168,000 there will be a need to release assets in the investment portfolio to the value of circa £72,000. The current value of the Fund’s investment portfolio stands at £1,921,298 and as such the Fund is very well placed to continue its operations against a background of reduced income.

Investment policy and performance

Under the articles of association, the Trustee-Directors have adopted rules governing the investment of funds. The Trustee-Directors have approved a detailed investment policy, in accordance with which the main objective of the portfolio is long-term growth in income and capital; the Benevolent Fund accepts medium risk in this aim. Activity in the portfolio is monitored by the Investments SubCommittee, which receives detailed reports from the investment managers (W H Ireland Ltd), who are represented at its twice-yearly meetings.

Reserves policy

The Institution of Structural Engineers Benevolent Fund does not seek funding from outside the membership of the Institution of Structural Engineers. Approximately 53% of the Fund’s income came from donations made with Institution subscriptions, one-off donations and bequests.

Legacy income, in particular, is very uncertain. The levels of dividends, interest received, and inflation tend to fluctuate. In order to safeguard the provision of grants to current and future beneficiaries the Trustees have agreed a target for reserves of between £2.25m to £2.7m with the position relative to the target reviewed at each Trustee meeting. As at 31 December 2020 the Fund held reserves of £1.65m, considerably below target. The fund had free reserves of £25k at 31 December 2020, the remainder of its reserves being investments made for the purposes of generating income to pay grants to beneficiaries. Due to the impact of Covid-19 on the value of shares, the amount of free reserves has weakened. However, the recent valuation and increase in investment performance of the investments suggest that the minimum reserves level of £2.25m is achievable by the end of 2021. Based on the recent analysis of the fund’s future financial position, there will be sufficient cash resources available to meet its financial obligations as they fall due.

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

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Benevolent Fund

Grant-making policies

Under policies adopted by the Trustee-Directors, each case is considered on its merits (that is, there is no scale grant); grants are not made to assist in the professional development of Institution members; and grants are not, normally, made to student members of the Institution, or to dependants or former dependants of Institution members who are either their children aged 21 or over or legally separated or divorced from the member, or for the purpose of funding private health care, or totalling more than £14,000 to any individual beneficiary (£21,000 for a couple, £6,000 for first dependent, £3,000 for second dependent) in any year. Furthermore, payments are not made that would reduce a beneficiary’s entitlement to public funding (each application is reviewed by the Benefits Consultant). If the Benevolent Fund settles debts, it will not normally pay any subsequent debts. Where applicable, the Benevolent Fund pays in respect of a beneficiary a sum to the Institution in respect of their annual subscription and Engineering Council UK fee.

Fund raising

Section 162a of the Charities Act 2011 requires charities to make a statement regarding fundraising activities. Although the Benevolent Fund does not undertake widespread fundraising from the general public, the legislation defines fund raising as ‘soliciting or otherwise procuring money or other property for charitable purposes.’ Such amounts are presented in our accounts as ‘Donations and legacies’.

In relation to the above the Trustee-Directors confirm that all solicitations are managed internally, without involvement of commercial participators or professional fund-raisers, or third parties. The day to day management of all income generation is delegated to the Secretary and members of the Advisory Council, who are accountable to the Trustee-Directors.

The Benevolent Fund is not bound by any undertaking to be bound to any regulatory scheme and the Trustee-Directors do not consider it necessary to comply with any voluntary code of practice.

No complaints have been received in relation to fundraising activities.

Charity Governance Code

The Trustee-Directors have considered the Charity Governance Code for smaller charities and have in general adopted its principles.

The Trustee-Directors of the Fund and the members of its Advisory Council are drawn from the membership of the Institution of Structural Engineers. Currently the diversity of this group is not as wide, or as representative of the Institution’s membership, as the Trustee-Directors wish, and they intend to take steps to increase its diversity when opportunities are available.

Some Trustee-Directors have served for longer than ten years but having reviewed this it is felt to be appropriate; this will be kept under review.

6 PLANS FOR FUTURE PERIODS

While keeping the Benevolent Fund’s policies, procedures and activities under review, and ensuring that it operates effectively and efficiently, the Trustee-Directors currently have no plans for major longterm change. Clearly the Covid-19 pandemic has led to changes in income and a possible increase in applications in 2021, which may in turn lead to an increase in the number of grants awarded to

DIRECTORS AND TRUSTEES’ REPORT (CONTINUED)

9

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Benevolent Fund

Independent auditor’s report to the members of The Institution of Structural Engineers Benevolent Fund

Opinion

We have audited the financial statements of The Institution of Structural Engineers Benevolent Fund for the year ended 31 December 2020 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity 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 the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Directors’ and Trustees’ 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.

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

11

Benevolent Fund

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 Directors’ and Trustees’ Report (which incorporates the directors’ 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 for the financial statements

As explained more fully in the trustees’ responsibilities statemen as set out on page 6, 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 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 is detailed below:

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Benevolent Fund

Based on our understanding of the group and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to charity and company law applicable in England and Wales, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and the Charities Act 2011.

We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to income and grant recognition. Audit procedures performed by the engagement team included:

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.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.

Thomas Wilson (Senior Statutory Auditor) For and on behalf of Haysmacintyre LLP, Statutory Auditor 10 Queen Street Place London EC4R 1AG

Date: 02 June 2021

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Benevolent Fund

STATEMENT OF FINANCIAL ACTIVITIES

FOR THE YEAR ENDED 31 DECEMBER 2020

Notes
Income from:
Donations and legacies
3
Investment income
4
Total income
Expenditure on:
Costs of raising funds
Fundraising and publicity
Expenditure on Charitable activities
Grants
12
Total expenditure
Net (expenditure) / income before gains and losses on investments
(Losses) / gains on investments
Net movement in funds for the year 9
Total funds brought forward
Total funds carried forward		 Total Unrestricted
Funds
2020
2019
£
£
39,001
46,299
34,932
123,280
73,933
169,579
24,007
24,400
140,886
119,552
164,893
143,952
(90,960)
25,627
(1,020,767)
199,056
(1,111,727)
224,683
2,766,190
2,541,507
1,654,463
2,766,190		 Total Unrestricted
Funds
2020
2019
£
£
39,001
46,299
34,932
123,280
73,933
169,579
24,007
24,400
140,886
119,552
164,893
143,952
(90,960)
25,627
(1,020,767)
199,056
(1,111,727)
224,683
2,766,190
2,541,507
1,654,463
2,766,190
169,579
24,400
119,552
143,952
25,627
199,056
224,683
2,541,507
2,766,190

All amounts relate to continuing activities. All recognised gains and losses are included in the Statement of Financial Activities.

14

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Benevolent Fund

STATEMENT OF CASH FLOWS AND RELATED NOTES 31 DECEMBER 2020

Notes
Cash flows from operating activities
Net movement in funds for the financial year
Adjustments for:
Net fair value losses / (gains) recognised in statement of financial activities
Dividend income from fixed and current asset investments 4
Decrease / (increase) in trade and other debtors
Increase / (decrease) in trade creditors
Net cash used from operating activities
Cash flows from investing activities
Dividends received on fixed and current asset investments 4
Purchase of current asset investments
9
Sale of current asset investments
Net cash used from investing activities
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year		 2020
£
(1,111,727)
1,011,665
(34,932)
187,386
70,026
122,418
34,932
(378,270)
200,413
(142,925)
(20,507)
48,902
28,395		 2019
£
224,683
(199,056)
(123,280)
(162,486)
(2,307)
(262,446)
123,280
(257,941)
434,685
300,024)
37,578
11,324
48,902

16

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS 31 DECEMBER 2020

1. ACCOUNTING POLICIES

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

The Institution of Structural Engineers Benevolent Fund meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s).

Due to the Covid-19 pandemic the Fund has reviewed its income and expenditure and the impact on cash flow to May 2022. The current value and mix of investments within the investment portfolio was also reviewed and although there has been a significant drop in the value of the portfolio, the Trustee-Directors are satisfied that based on the work done that the preparation of the accounts on a going concern basis is appropriate. This conclusion has been largely formed based on the high level of liquid funds available compared to the annual spend.

(a) Income

Donations, gifts, and legacies

Donations, gifts, and legacies are included in the financial statements when; the Benevolent Fund has entitlement to the funds, there is a probability that the Benevolent Fund will receive economic benefit, and the monetary value can be measured.

Investment income

Investment income, including any tax recoverable thereon, is included in the financial statements in the year in which it is receivable.

(b) Expenditure

Expenditure is incorporated in the financial statements as incurred, and includes irrecoverable Value Added Tax.

Grants are incorporated when notified to beneficiaries. Any commitments payable at a later date are included in the balance sheet as creditors. Payments comprise grants awarded to members and their families. Any grants which are subsequently repaid are treated as donations.

Support costs

These costs represent the general administration in supporting the operational activities for which the charity is responsible.

Governance costs

These costs include the costs of governance arrangements which relate to the general running of the charity as opposed to the direct management functions inherent in the charitable activities. This includes external audit costs and legal fees.

(c) Investments

Investments are shown at market value. Unrealised gains and losses are incorporated within the fund balance and are identified as unrealised. Market value is based on bid prices for listed investments.

17

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS 31 DECEMBER 2020(CONTINUED)

d) Loans to beneficiaries

Loans to beneficiaries are recognised and measured at the amount paid, with the carrying amount adjusted in subsequent years to reflect repayments and any impairments.

The Benevolent Fund does not charge interest on its loans to beneficiaries.

2. NET INCOME AND NET MOVEMENT IN FUNDS

The net income and net movement in funds are wholly attributable to the company’s activity of the administration of funds held for charitable purposes and arise mainly within the United Kingdom.

3. INCOME FROM DONATIONS AND LEGACIES

Donations in the year were received from:

Regional Groups
Legacies
Tax recovery
Individual donations
Total		 2020
£
957
-
1,916
36,128
39,001		 2019
£
2,684
2,500
2,298
38,817
46,299

4. INVESTMENT INCOME

Investment income for the year is derived from:

Listed investments including government securities
Cash deposit		 2020
£
34,932
-
34,932		 2019
£
123,280
-
123,280

5. SUPPORT AND GOVERNANCE COSTS

Basis of allocation
Management & administration
Expenditure ratios
Governance
Expenditure ratios
Total		 Fundraising &
Publicity
Grants
Total
£
£
£
3,820
22,419
26,239
200
1,176
1,376
4,020
23,595
27,615

18

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS 31 DECEMBER 2020 (CONTINUED)

COMPARATIVE FIGURES FOR 2019

Fundraising &
Basis of allocation Publicity Grants Total
£ £ £
Management & administration Expenditure ratios 1,950 9,556 11,506
Governance Expenditure ratios 136 669 805
Total 2,086 10,225 12,311

All grants issued are to individuals with links to the Institution of Structural Engineers, and who require financial assistance.

6. NET INCOME FOR THE YEAR

Net income is stated after charging:

2020 2019
£ £
Auditors’ remuneration 1,200 690

7. DIRECTORS AND TRUSTEES

No director received any remuneration during the year (2019 – none).

During the year 9 directors were reimbursed travelling expenses incurred whilst engaged on the business of the charity amounting to £176 (2019 – 9 directors were reimbursed £2,126).

The Benevolent Fund does not employ any staff, and there is no Senior Management remuneration.

8. RELATED PARTY TRANSACTIONS

During the year the Fund had the following transactions with the Institution of Structural Engineers.

2020 2019
£ £
Income
Charitable donations 35,875 39,002
Expenditure
Management charge 14,400 6,000

19

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS 31 DECEMBER 2020 (CONTINUED)

9.
INVESTMENTS
Carrying value at the beginning of year
Add: additions to investments at cost
Less: disposals at carrying value
Less: net loss / gain on revaluation
Cash movement
Carrying value at the end of the year
Investments, all of which are in the UK, are made up of:
Listed investments
Cash investments (see note 10)
Carrying value at the end of the year
The historical cost of fixed asset investment is:		 2020
£
2,639,092
378,270
(239,080)
(972,999)
(161,502)
1,643,781
2020
£
1,629,127
14,654
1,643,781
2,360,369		 2019
£
2,464,457
257,941
(213,044)
(22,584)
152,322
2,639,092
2019
£
2,462,936
176,156
2,639,092
2,371,430

The listed investments and cash deposits were managed on behalf of the company by WH Ireland, on a discretionary basis and include direct investment in listed investments and indirect investment through unit and investment trusts.

Cash deposits within the portfolio are held on overnight deposit.

Investments within the portfolio which amount to more than 5% of the total values are:

Listed investments

23,620 Aviva GBP 0.25
67,000 Barclays PLC
91,000 BT Group GBP0.025
6,650 Carnival PLC ORD USD 1.66
17,000 EasyJet ORD GBP 0.27285714
170,000 International Consolidated Airlines Group
450,000 Lloyds Banking Group
24,100 TUI AG ORD REG SHS NPV (DI) ST GBX12.25389
8,850 Prudential PLC
105,733 Rolls-Royce Holdings PLC
105,850 NatWest Group PLC		 2020
£
-
98,276
120,347
90,905
141,100
271,660
163,980
-
119,210
117,628
177,457
1,300,563		 2019
£
199,385
-
175,120
209,530
259,259
431,250
268,750
172,161
152,145
-
266,373
2,133,973

20

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS
31 DECEMBER 2020 (CONTINUED)
Other listed investments individually under 5%
Cash investments


Investment Management Fees:
Amounts paid to manage investments		 328,564
14,654
1,643,781
2020
£
16,544
16,544		 328,963
176,156
2,639,092
2019
£
22,313
22,313

Investment management fees appear in the Statement of Financial Activities under Other Costs

10. DEBTORS

Amounts due within 1 year:
Unsecured loans to beneficiaries
Cash investments
Other debtors
Amounts due after 1 year:
Secured loans to beneficiaries
Unsecured loans to beneficiaries		 2020
£
4,000
14,654
9,754
81,670
6,000
116,078		 2019
£
2,000
176,156
25,638
91,670
8,000
303,464

The secured loans to beneficiaries were advanced on the security of a fixed charge over freehold property. The loans are repayable when vacant possession of the properties is available. The Benevolent Fund does not charge interest on these loans. The unsecured loan is repayable over 5 years with the first and second instalments paid on 1[st] February 2021.

11. CREDITORS

Amounts falling due within 1 year:
Other creditors
Management charge due to Institution of Structural Engineers
Grant creditors – secured		 2020
£
5,769
14,400
98,969
119,138		 2019
£
742
6,000
42,370
49,112

21

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS

31 DECEMBER 2020 (CONTINUED)

12. GRANTS 2020

Grants committed to during 2019 and paid during 2020
226
Widow of Fellow, aged 91
308
Graduate, aged 71
310
Widow of Fellow, aged 78
312
Member, aged 82, married
337
Former Associate-Member, aged 67, married
342
Widow of Fellow, aged 82
355
Fellow, aged 85, widowed
358
Fellow, aged 91, married
362
Fellow, aged 95, married
367
Technician, aged 63, married
369
Fellow, aged 81, married
370
Fellow, aged 74, married
372
Member, aged 32, married
377
Graduate, aged 65, married
379
Former member, aged 78, married
381
Member, aged 35, married
382
Member, aged 52, married
383
Member, aged 63, married
385
Graduate, aged 39, married with 2 children
388
Former member, aged 76, married
389
Graduate, aged 39, married with 2 children*
Total grants paid during 2020
Grants committed to during 2020 and due to be paid during 2021
Allocated support costs		 £
(42,370)
First assisted
250
1998
1,550
2010
6,350
2010
3,825
2010
4,792
2014
3,020
2014
4,600
2016
5,200
2017
2,300
2017
10,325
2018
14,700
2018
12,300
2018
4,462
2018
3,500
2019
8,950
2020
3,900
2020
10,850
2020
1,945
2020
3,342
2020
3,200
2020
5,800
2020
115,161
44,500
23,595
140,886

*Joint beneficiary of the Institution of Structural Engineers and the Institution of Civil Engineers Benevolent Funds.

22

Benevolent Fund

NOTES ON THE FINANCIAL STATEMENTS 31 DECEMBER 2020 (CONTINUED)

13. Analysis of changes in net debt

Cash
Cash investments
Total		 At the 1st
January 2020
£
48,902
176,156
225,058
225,058		 Cash flows
£
(20,507)
(161,503)
(182,010)
(182,010)		 Other non-
cash
changes
£
-
-
-
-		 At 31st
December
2020
£
28,395
14,653
43,048
43,048

23