2021-03-31-accounts

charity iarLII9 f'oi oop.ole h*o-, (J Clif aje. Charitable Funds Annual Report 2020/21 ppl))

CONTENTS

Chairman’s welcome	1
Who we are	2
Our achievements	4
Structure, governance and management	7
Contact us, trustee and advisors	9
Financial review 10
Reserves policy	11
Investments	11
Fund expenditure policy	12
Statement of Trustee’s responsibilities	13
Statement of Financial Activities	17
Balance Sheet as at 31st March 2021	18
Cash Flow Statement	19
Notes to the accounts	20
Independent Audit report	28

Chairman’s welcome

Welcome to our annual report for 2020/21. We exist to support the work of Liverpool Heart and Chest Hospital NHS Foundation Trust and that support has never been more needed than during the past twelve months.

The pandemic had a profound effect on all our lives but none more so than the dedicated team working at LHCH. Thanks to the exceptional assistance we have received from our donors this year we have been able to do so much to assist our staff during some of the most testing times of their working lives. From the provision of a Staff Hub to a special Thank You gift at Christmas we have been able to show our appreciation for their outstanding efforts.

We have also, of course, been able to do more for our patients with the introduction of new ways of working such virtual clinics which reduce the need for unnecessary travel, helped our patients and their families stay connected when visiting was restricted with the use of tablets and established a vaccine hub for the benefit of the wider community.

None of this would have been possible without the overwhelming assistance that we have received not only from members of the general public but also from both national and local companies and grant making trusts and we owe them all our heartfelt thanks.

The Liverpool Heart and Chest Hospital Charity exists to support that work in three ways:

Extending the Excellence

Providing additional amenities and support for our patients, their families and our staff. Many of our patients travel long distance to access our specialist services and we help by providing accommodation for family and loved ones during what is often a very stressful time.

Tomorrow’s medicine today

Research undertaken at Liverpool Heart and Chest Hospital could change the way heart and lung medicine is practised in the future.

The latest and the best

The LHCH Charity ensures that wherever possible our dedicated medical staff have access to the very latest and best in equipment and training. In this way we can make sure that our patients are always receiving the most up to date treatments available.

Key highlights of our year:

• Provision of the Staff Hub which provided a welcoming and relaxing space for our staff

• Supporting the introduction of a tele-medicine facility for those who could not visit the hospital due to having to shield

• Supporting education and training with a grant to complete the refurbishment of Highfield House making it a modern and accessible space for all our staff

• Making the hospital a more covid-safe space with the provision of additional facilities and equipment

• A continuing partnership with the University of Liverpool helping to identify joint fundraising partnerships

Bob Burgoyne – Chairman LHCH Charity

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Who we are

How we achieve our aims

The strategy for achieving our aims breaks down into two separate strands:-

• Identification of areas for support

The Liverpool Heart and Chest Hospital Charity exists to support the work of the hospital by providing additional support and resources that are above and beyond what would normally be available through statutory sources.

The Object of LHCH Charity is:-

“For any charitable purpose or purposes relating to the National Health Service wholly or mainly for the service provided by the Liverpool Heart and Chest Hospital NHS Foundation Trust”.

Aims of LHCH Charity:-

Heart and Lung diseases are amongst the 2 biggest killers in the UK today. Every 2 minutes someone has a heart attack and 1 in 5 people are affected by respiratory diseases.

LHCH Charity aims to support Liverpool Heart and Chest Hospital in its care and treatment of patients, their families and staff by:

• assisting the hospital with the purchase of the latest state of the art equipment, research and training

• supporting innovative research to improve our understanding of heart and lung Diseases

• providing patients, their families and our staff with additional amenities which would otherwise not be available from statutory sources.

• A strategy for fundraising for the identified areas

a) Identification of areas for support

LHCH Charity, in conjunction with the Executive Team of the hospital, identify projects that have a criteria that fits within the 3 aims which will be supported via the General Fund. These projects are broken down by size in terms of cost into short, medium or longer term projects.

In addition each of the Funds which sit underneath the Charity umbrella have been requested to complete a form indicating how they propose to spend monies within each 12 month period. The recommendation for each Fund is that in line with best practice at least 33% of the Fund’s opening balance is spent within the year unless they are planning on building funds towards a specific service or item of equipment.

b) Fundraising Strategy for identified projects.

The Head of Fundraising produces a yearly strategy which identifies the potential for fundraising for the short term aims (usually required within the financial year) as well as providing details of plans for achieving the medium and long term goals including Income and Expenditure projections as well as a Fundraising Ratio Cost and a Return on Investment Cost. This is approved by the Charitable Funds Committee and then, ultimately, the Corporate Trustee.

The Fundraising Strategy is then evaluated at each meeting of the Charitable Funds Committee in relation to its progress in achieving the support required for each of the projects.

By doing this LHCH Charity ensures that its legal purpose is fulfilled

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How LHCH Charity Fundraises

LHCH Charity is guided in all of its fundraising by the Code of Fundraising Practice. Campaigns are run and managed by the charity’s staff and the charity does not work with professional fundraisers or commercial participators in generating funds.

During the year LHCH Charity received no complaints from its donors or others about the standard of its fundraising approaches. It received no requests from the Fundraising Preference Service for donors to be removed from the database.

LHCH Charity and Social Investment

LHCH Charity was not involved in any social investment during the past 12 months

LHCH Charity and Grant Making

LHCH Charity was not involved in making grants to external organisations during the last 12 months but did make several grants to internal projects as per our aims and objectives during the year.

LHCH Charity and Donated Goods, services and volunteers

The Charity does occasionally receive goods for re-sale in its office premises at the hospital. These are recorded as gift in kind items and processed through the till with other purchased merchandise. If a gift equalling more than £1,000 is received then this is reported to the Charitable Funds Committee for noting.

The Charity did not work with any volunteers during the past 12 months.

Public benefit

Liverpool Heart and Chest Hospital NHS Foundation Trust is the main beneficiary of the charity and is a related party by virtue of being Corporate Trustee of the charity. By working in partnership with the Trust, the charitable funds are used to best effect for the benefit of the public served by the Trust. When deciding upon the most beneficial way to use charitable funds, the Corporate Trustee has regard to the main objectives, strategies and plans of the Trust, whilst ensuring that the grants reflect the wishes of patients and staff.

At the core of every charity is the requirement to provide benefit to the public. This is the foundation of their charitable status, and each charity must demonstrate how this requirement is met through their aims and activities.

The focus of our activities is to benefit the public who utilise the services of Liverpool Heart and Chest NHS Foundation Trust. This hospital mainly services the community of Cheshire, Merseyside, North Wales and the Isle of Man, all of whom have equal access to its facilities. Charitable expenditure is made by way of direct grants to the Liverpool Heart and Chest Hospital NHS Foundation Trust, to enhance the patient care already provided.

The Trustee refers to Charity Commission guidance on achieving public benefit when reviewing the aims and objectives of the charity and in the planning of future activities.

During the year the funds raised were distributed to provide a wide range of benefits, over and above what would be expected from statutory sources to our patients, their families and our staff.

The agents of the Corporate Trustee have complied with their duty to have due regard to the guidance on public benefit published by the Charities Commission in exercising their powers or duties.

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Our achievements

Like many charities LHCH Charity faced many challenges during the year. Despite this we were still able to make a significant contribution to the health and well-being of our patients, their families and our staff.

The Highfield House Training and Education Centre

The care, education and training

of our staff have never been more important than the last 12 months. New practices and procedures have had to be introduced at a pace to deal with the Covid-19 pandemic as well as, of course, the need for the continuous updating of skills to ensure that our staff are at the forefront of the latest developments. This is why the provision of a dedicated area for training, education and facilities for on-call staff was a priority for us during 2020.

The hospital had already provided nearly half a million pounds for this development and the charity was able to secure a further £200,000 of funding to make the new Highfield House Training Centre something really special.

It will provide:-

• Considerably expanded on-call facilities for our on-call staff, providing a place where they can rest and recharge

• Two dedicated training areas utilising the latest technology to ensure our expertise can be shared not only with our own staff but also those from other medical institutions

• A completely refurbished library space where students and staff can update their knowledge

This new development will be key to ensuring that our staff stay as leaders in the field of heart and lung care for many years to come and we want to thank you for helping us to make this happen.

The Staff Hub

At the beginning of the pandemic LHCH Charity provided the funds to change an old record office into a warm and welcoming Staff Hub. A place where they could go, relax, recharge and share their experiences with others. This has proved an invaluable place for staff and has helped them to carry on during some of the most difficult times of their working lives.

Tele-medicine facilities

Thanks to you we were able to provide telemedicine facilities for those patients who could not visit in person due to the risk. This is especially true of those living with Cystic Fibrosis who are very susceptible to infection but also most in need of routine monitoring of their condition.

Using tele-medicine meant that our patients could meet with multiple health

professionals at one time to discuss their condition, minimising their risk, reducing their need to travel as well as making it more efficient for our staff enabling us to see more people.

This additional work would not have been possible had it not been for the support of LHCH Charity.

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In addition to our two main priorities the charity also assisted in:-

The latest and the best – life in 3D

LHCH Charity helped to purchase a new 3D transesophageal echocardiogram machine for our theatres to enable our surgeons to have the state of the art equipment they need when operating on the heart.

Patient and Family Focused

The Robert Owen House Appeal supporters the provision of inexpensive overnight accommodation for relatives and friends of patients. This is particularly important given the wide catchment area of the hospital which extends across the entire North West Region, North Wales and for certain specialist treatments, nationally and internationally.

The provision of this accommodation has only been possible due to the on-going fundraising of various groups and individuals, in particular the Isle of Man Friends of Robert Owen House who donated £25k during 2020/21.

Tomorrow’s medicine today

Supporting research is a key part of the remit of LHCH Charity. During the past year the Charity has supported a number of research initiatives including a 5 year grant of £20,000 per annum from a charitable trust in support of the work of a Patient Research Ambassador.

Monitoring our Performance:

LHCH Charity, through the Charitable Funds Committee and ultimately the Corporate Trustee, benchmarks its performance in a number of ways:-

• It provides comparator information with similar charities and measures itself against them in terms of performance, percentage fundraising costs and return on investment.

The impact of the Covid-19 pandemic played a major part in LHCH Charity significantly improving on its target raising £1,242,828 against a predicted target of £576,000.

A good balance of major gifts from charitable trusts, legacies, corporate support and donations from our supporters helped us to achieve this figure which enabled us to do so much more than would have been possible during a very challenging year for the hospital.

This year also saw the review of the 5 year Fundraising Strategy which was developed in 2016. During this period our key achievements have been

• A 43% increase in donations on the previous 5 year period

• The number of donations received increased by 51%

• A new brand identity was produced with associated print and electronic media

• Was the second highest performing charity amongst the comparator charities with regards to income against expenditure percentage costs.

• It identifies fundraising projects and measure its fundraising achievement against the targets set for the achievement of each project.

• It reviews the external factors which may affect the charity including national and local economic forecasts

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How our Supporters Helped

Just like NHS Charities Together had Captain Tom – LHCH Charity had our own band of extraordinary supporters during the Covid-19 Crisis. Including:-

Jessica’s Marathon Effort

5 year old Jessica O’Connor decided to run a marathon! Jessica said: “I’ve already run a mile so I can do this 25 and half times more to help the poorly people where Mummy works.” And she did - raising over £1,151 for LHCH Charity.

The Wonderful Wigfields

When the Chest Half Marathon was cancelled Charlotte Wigfield decided that she would do it virtually and in support her whole whole family got together to undertake their own challenges raising an amazing £1,953 in total!

Handmade with Love

11 year old Lois Higgins developed the idea of making her own multi-coloured wristbands to raise funds. After many hours of work and over 500 wristbands produced she has raised the magnificent amount of £1,200 for both LHCH Charity and

Of course, it wasn’t just individuals who showed their support this year. We are very grateful to the MailForce Charity for their magnificent donation of £284,000 to assist with the purchase of PPE and specialist equipment. We were also very grateful to receive support to a total of £202,000 from NHS Charities Together to help our staff and patients during the worst times of the pandemic.

Companies also played their part with Marks & Spencer, Morrison’s, Tesco and other all making contributions to help us with our work.

To all who responded whether you undertook a marathon or wrote a cheque – from everyone here at LHCH thank you from the bottom of our hearts.

How You Can Help

You can get involved with LHCH Charity by:-

Ringing the Charity Office on: 0151 600 1409

Emailing s at: [e-mail]. Writing to us at: LHCH Charity, Freepost RRLL-KSHT-ZLKE, Thomas Drive, Liverpool L14 3PE

There are so many things you can do:

• Show your support by making a donation by post, online or by calling the Charity Office

• Be one of our Charity Ambassadors and use your time to promote our work and get people involved – even set up your own local fundraising group

• Volunteer – you can help at events, at the Charity Office, be a collection box and badge placer, you can even work at home helping us with research

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Structure, governance and management

Charity Structure

LHCH Charity is an umbrella charity which holds a number of individual funds under one Charity Registration Number (Charity Registration Number 1052813). The overall responsibility for the running of the charity lies with the Corporate Trustee i.e. the Board of Directors of Liverpool Heart and Chest Hospital.

The Charitable Funds Committee is established as a Committee of the Board of Directors of Liverpool Heart and Chest Hospital NHS Foundation Trust in order to ensure the Trust’s duty as Corporate Trustee of its Charitable Funds has been discharged.

The Charitable Funds Committee operates within Terms of Reference authorised by the Board of Directors of Liverpool Heart and Chest Hospital NHS Foundation Trust. The Committee has no executive powers other than those specifically delegated in its Terms of Reference which are:-

Develop the strategy and objectives for the Charity for consideration and approval by the Corporate Trustee

Oversee the implementation of an infrastructure appropriate to the efficient and effective running of the Charity

Oversee the development and delivery of the Fundraising Strategy, as aligned to the Trust’s annual plan

Oversee the expenditure of the Charity

Oversee the Charity’s Investment Plans

Monitor the performance of all aspects of the Charity’s activities and ensures that it adheres to the principles of good governance and complies with all relevant legal requirements

Act as the Committee that discharges the Board’s responsibilities (as sole Corporate Trustee) as they relate to Charitable Funds under the Trust’s custodianship.

Ensure that the charitable funds held by the Trust are managed in a manner

consistent with the requirements of the relevant regulatory and statutory frameworks and in accordance with the guidance on NHS Charities set out by the Charity Commission.

When in this role act solely in the best interests of the Charity and in a manner consistent with the Charity Commission’s requirements and expectations of the Corporate Trustee.

Oversee the Charity’s strategy, governance, major plans and key risks on behalf of the Corporate Trustee.

Establish, prioritise and approve major fundraising projects in accordance with the strategy and approve expenditure items in accordance with delegated authority levels set out in Standing Financial Instructions.

Monitor the performance of fundraising and marketing activity, ensuring that the return on investment is satisfactory and that income targets are met.

Devise and implement an investment strategy for the charity, including the appointment and monitoring of any investment managers

Ensure the approval and submission of statutory returns, annual accounts and Trustee’s Report in accordance with the Charity Commission’s Statement of Recommended Practice.

Approve any policies and procedures required for the effective management of the Fund

Members of the Charitable Fund Committee attend quarterly Charitable Funds meetings.

Recruitment and appointment of Trustees

Non-Executive Members of the Board of Directors are appointed by the Council of Governors and Executive Members of the Board are subject to recruitment by the Nominations and Remuneration Committee (Executive). Members of the Board of Directors and the Charitable Funds Committee are not individual Trustees under Charity Law but act as agents on behalf of the Corporate Trustee.

Trustee Training and Induction

The Trust sees Trustee training as important and has provided access to resources and materials including:-

• LHCH Charity is a member of NHS Charities Together and regularly receive updates from this source. In the last year they have been able to provide access to webinars ranging from “A Legal Overview and

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Update on NHS Charities” and “Investment Management in NHS Charities” to “Promoting Your Charity”.

• In October 2020 all Trustees had the opportunity to attend a webinar organised by the Fundraising Regulator on understanding their role as a Charity Trustee and their special responsibilities in relation to fundraising.

• In January 2021 CCLA (the Charity’s Investment Managers) attended the Charitable Funds Committee and provided a briefing on the status of the current portfolio, the results and predicted future performance.

• In addition the Trustees also received detailed information on “Using NHS Charitable Funds” from the Healthcare Financial Management Association which provided guidance on the legal and regulatory requirements for charitable expenditure.

Trustee Duties

The Corporate Trustee fulfils its legal duty by ensuring that funds are spent in accordance with the objects of each fund and by designating funds, the Trustee respects the wishes of our generous donors for the advancement of health or saving lives, to provide patient and staff benefit or for the advancement of education and research.

The Liverpool Heart and Chest Hospital NHS Foundation Trust is the main beneficiary of the charity and is a related party by virtue of being Corporate Trustee of the charity. The accounts of the charity are not consolidated into the accounts of the Trust as they are not material.

Charitable Funds

The Charity’s unrestricted fund was established using the model declaration of trust and all funds held on trust as at the date of registration were part of this unrestricted fund. Subsequent donations and gifts received by the charity that are attributable to the original fund are added to those fund balances within the existing charity.

Risk Management

Using the NHS Trust’s own Risk Register policies and procedures The Trustees have considered potential risks to which the charity is exposed. The LHCH Charity Risk Register is reviewed annually by the Charitable Funds Committee.

There are no major risks that have been identified

Day to day management

The Trust has in place a scheme of reservation and delegation to support the day to day management of the charity.

The Head of Fundraising oversees the day to day running of the charity and the planning of fundraising activities for the charity. The Head of Financial Services acts as the principal officer overseeing the day to day financial management and accounting for the charitable funds during the year.

The charity does not directly employ any staff. The charity funds staffing costs of fundraising and administration staff who run and support the charity. These staffing contacts are held by the Foundation Trust and recharged accordingly. Pay grades for those working within the Charity are set using NHS Pay Scales.

Related parties

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Contact us, Trustee and Advisors

Liverpool Heart and Chest Hospital Charity Registered Charity Number: 1052813 (previous names: The Heart Appeal, The Merseybeat Appeal)

Members of the Liverpool Heart and Chest Hospital Board of Directors who served during the financial year were as follows:-

Name	Title
N Brooks	Non-Executive Director
M Jones	Non-Executive Director
J Farmer	Non-Executive Director
B Burgoyne	Non-Executive Director from 1st April 2019
K O’Hagan	Non-Executive Director from 1st May2019
J Tomkinson	Chief Executive Officer
R Perry	Medical Director & DeputyCEO
**Karen Edge **	Chief Finance Officer
S Pemberton	Director of Nursing&Quality

Principal Financial Advisors:

Banker:	Solicitor
Barclays Bank Plc North West Larger Businesses P O Box 378 71 Grey Street Newcastle Upon Tyne NE99 1JP	Hill Dickinson Pearl Assurance House Derby Square Liverpool L2 9XL

Investment Broker:	Auditor
CCLA Investment Management Senator House, 85 Queen Victoria Street, London EC4V 4ET	McLintocks (NW) Limited 2 Hillards Court Chester Business Park Chester CH4 9PX

Responsibility for the on-going management of funds is delegated by the Corporate Trustee to the Charitable Funds Committee which administers the funds on behalf of the Corporate Trustee. The names of the people who served as agents for the Corporate Trustee, as permitted under regulations 16 of the NHS Trust’s (Membership and Procedures) Regulations 1990, were as follows:-

Name	Position
Julian Farmer	Non-Executive Director
Nicholas Brooks	Non-Executive Director
Bob Burgoyne	Chair of Charitable Funds Committee
Jane Tomkinson	Chief Executive Officer
**Karen Edge **	Chief Finance Officer

Principal office

The principal office for the charity is:

Liverpool Heart and Chest Hospital Charity Thomas Drive Liverpool L14 3PE

For more information on the LHCH Charity please visit our website at www.lhchcharity.org.uk

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Financial Review

The financial statements have been prepared in accordance with the historic cost basis, with the exception of investments which are included at re-valued amounts. The financial statements have been prepared on the going concern basis and in accordance with the Statement of Recommended Practice “Accounting and Reporting by Charities (SORP 2019)” issued in March 2015, applicable to charities preparing their accounts in accordance with the financial reporting standard applicable in the UK and Republic of Ireland (FRS 102), effective 1st January 2015.

The net assets of the charitable fund as at 31[st] March 2021 were £2,161k (2019/20 £1,687k), an increase of £474k during the financial year.

Total incoming resources this year amounted to £1,322k (2019/20 £714k). The incoming resources have increased due to 2 large legacies and donations arising from the pandemic.

Of the total expenditure of £982k (2019/20 £426k), expenditure on charitable activities was £852k (2019/20 £270k) and expenditure on raising funds was £127k (2019/20 £152k).

Income summary Table

Donations General Charitable Trusts Legacies		2020-21 462,355 486,400 344,273	2019-20 529,505 79,382 6,722
	1,293,028		615,609

----- Start of picture text -----
Breakdown of Income Sources 2020/21
----- End of picture text -----

----- Start of picture text -----
36%
27%
General
Charities Trust
Legacies
37%
----- End of picture text -----

Breakdown of Income Sources 2019/20

----- Start of picture text -----
1%
13%
86%
General
Charities Trust
Legacies
----- End of picture text -----

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Going Concern

The Trustee has a reasonable expectation that the Charity has adequate resources to continue as a going concern. Expenditure is discretionary and balanced against the reserves policy requirements. Accounting for income and expenditure is on an accruals basis to ensure all committed expenditure is reflected in the reporting process, and the Charity has sufficient resources to meet its committed expenditure for 12 months from the date that the financial statements were approved by the Charitable Funds Committee.

On an annual basis, the funds will be examined to ensure compliance with this reserves policy.

The Covid-19 pandemic has impacted significantly on the income expected during the financial year 2020/21 with the charity achieving double what it had projected for fundraising income.

This has meant that our current reserves are higher than anticipated however a significant proportion of the funds raised have already been identified for spending so the reserves will revert to compliance within the coming months.

Reserves policy

The Trustee is under a legal duty to apply charity funds within a reasonable time of receiving them. In order to comply with this duty, the Trustee has developed a reserves policy to explain the level of reserves held and set out how they will be managed.

The reserves policy applies to unrestricted funds, and states that the level of reserves should be sufficient to:

• Ensure stability of grant funding;

• Cover between one and three years administration, fund-raising and support costs; and

• Maintain the level of investments at its current level in order to mitigate against significant fluctuations in the levels of donations

Therefore, the Trustee considers it prudent that the target range of unrestricted reserves is between £500,000 and £1,500,000 to ensure that the charity can run efficiently and meet the needs of its beneficiaries. The Balance Sheet shows unrestricted reserves of £2,161k at the end of the financial year. The value is outside the reserves range required by the policy. The charity had applications valuing £675k approved at the end of March which would give a reserves balance available for future approvals of £1,498k, which is consistent with the reserves range.

Restricted funds are excluded from this policy, in accordance with the Charity Commission guidance as they are subject to specific trusts and are not fully expendable at the distraction of the Trustee.

Plans for future

In the coming years LHCH Charity aims to continue its work in raising funds in support of Liverpool Heart and Chest Hospital. In particular during the next 12 months it will seek to develop two major campaigns firstly to assist with the new Cath Lab development and also for equipment for our cancer services.

A strategy is being developed over the coming months to assist us with the planning of these major campaigns which will be overseen and supported by the Charitable Funds Committee and the Corporate Trustee. During this development phase the Charitable Funds Committee will review past fundraising initiatives and review the allocation of resources to the charity to enable it to fulfil its aims.

Investment Policy

The charity conforms to the investment powers given by the Charity Commission order for a NHS umbrella charity and the Trustee Act 2000.

Charitable funds are invested by the Chief Finance Officer in accordance with the Trust’s policy and subject to statutory requirements.

The members of the Charitable Funds Committee review the performance of investment and banking at the quarterly meetings. The Committee has decided that the Charities Official Invest Fund (COIF) is to be used for the investment of charitable funds. In year the Committee has chosen to invest their monies in the

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COIF charities ethical fund as this aligns with the Trust values and overall strategy as there are tighter restrictions on alcohol, tobacco and fossil fuels.

Amounts to be invested with COIF are decided by the Charitable Funds Committee. The amount originally invested in COIF was £400k. This investment has a current market value as at 31st March 2021 of £780k (31/03/2020 £646k).

At the end of the financial year the Charity held £2,344k (2019/20 £1,287k) in an instant access bank account.

The Charity has adopted the Trust’s policy on investments. This means that all cash balances must remain in a comparatively liquid form and all investments resulting from them must be realisable and have maturity not exceeding three months.

Cash deposits are invested in accordance with the Trust’s Treasury Management Policy which has been adopted by the Charity.

Short-term investments should be invested with banks rated: A+ Moody’s rating

Long-term investments should be invested with banks rated: A+ Moody’s rating

Dividends received are allocated to individual designated funds in proportion to their average closing balances for the relevant quarter.

The risk associated with the normal fluctuation in the value of investments are mitigated by holding investments in a diversified fund of investments and by only investing funds not required in the short or medium.

relevant information and to establish that the auditor is aware of such information.

Fund Expenditure Policy

Expenditure against any Charitable Fund is conditional upon the item being within the terms of the appropriate fund and the procedures approved by the Board of Directors.

Before expenditure is incurred consideration is given to the following:

• The funds may be used for the benefit of hospital staff (both clinical and support) as long as it is in line with the objective of the fund and it does not go beyond what a good employer would consider reasonable to provide.

• The funds cannot be used to campaign or lobby on behalf of the Trust

• Should comply with the requirements of the Charities Act 2006 on the Public Benefit Test where there is an identifiable benefit or benefits and this benefit must be to the public or section of the public

• Should not generally be spent for the benefit of specific individuals

• To supplement the remuneration (directly or indirectly) of officers

The authorised signatories must consider the following:-

• That the expenditure is within the general and specific restrictions placed upon the funds (the authorising officer must be aware of these)

• Must be applied for the purposes set out in the Governing Document

Re-appointment of Auditors

McLintocks (NW) Limited were appointed as auditor to the charity and a resolution proposing that they be re-appointed will be put at a General Meeting.

• That the funds are not freely available from other sources

• Must be applied with complete fairness between persons who are properly qualified to benefit from it.

Disclosure of information to auditor

Each of the trustees has confirmed that there is no information of which they are aware which is relevant to the audit, but of which the auditor is unaware. They have further confirmed that they have taken appropriate steps to identify such

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Annual accounts 2020/21

Trustee responsibilities statement

The Corporate Trustee is responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Charity and enable it to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008. It is 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.

Under charity law, the trustee is responsible for preparing the trustee’s annual report and accounts for each financial year which show a true and fair view of the state of affairs of the charity and of the excess of expenditure over income for that period.

In preparing these financial statements, generally accepted accounting practice requires that the trustee:

• selects suitable accounting policies and then apply them consistently

• makes judgments and estimates that are reasonable and prudent

• states whether the recommendations of the SORP FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements

• states whether the financial statements comply with the trust deed, subject to any material departures disclosed and explained in the financial statements

The trustee is required to act in accordance with the trust deed and the rules of the charity, within the framework of trust law. The trustee is responsible for keeping proper accounting records, sufficient to disclose at any time, with reasonable accuracy, the financial position of the charity at that time, and to enable the trustee to ensure that, where any statements of accounts are prepared by the trustee under section 132(1) of the Charities Act 2011, those statements of accounts comply with the requirements of regulations under that provision. The trustee has general responsibility for taking such steps as are reasonably open to the trustee to safeguard the assets of the charity and to prevent and detect fraud and other irregularities.

Signed on behalf of the trustee:

Bob Burgoyne Karen Edge Chair of Charitable Funds Committee LHCH Chief Finance Officer

• prepares the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue its activities.

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Liverpool Heart & Chest Hospital Charity

Annual Accounts for year ended 2020/21

Foreword

The Charity was created in 1996 under statutory instrument

The Charity exists for any charitable purpose or other purpose relating to the NHS wholly or mainly for the service provided by Liverpool Heart & Chest Hospital NHS Foundation Trust

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

The Trustees are responsible for preparing the annual report and financial statements in accordance with applicable law and accounting standards. Company Law requires the charity trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including income and expenditure of the charity for that period. In preparing the financial statements, the trustee's are required to:

• select suitable accounting policies and then apply them consistently;

• observe the methods and principles in the Charities SoRP (FRS 102);

• make judgements and estimates that are reasonable and prudent;

• state whether applicable UK accounting standards have been followed, subject to any material

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity to continue in business

The Trustee's are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charity and to enable them to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust deed. They are also responsible for safeguarding the assets of Charity and hence taking reasonable steps for the prevention and detection of fraud and other irregularities.

Bob Burgoyne Chair of Charitable Funds Committee

Karen Edge Financial Trustee

Page 15

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEE OF LIVERPOOL HEART AND CHEST HOSPITAL CHARITABLE FUND

Page 16

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Statement of Financial Activities for the year ended 31 March 2021

		2020-21	2019-20
	Note	Total	Total
		Funds	Funds
		£000	£000
Income and endowments from:	1.3
Donations and legacies	1.4	1,293	616
Other trading activities		4	9
Income from Investments	6.3	24	25
Income from Charitable activities	1.5, 6.4	1	64
Total income and endowments		1,322	714
Expenditure on:	1.6, 1.7, 3.1, 4.1
Raising funds	1.9, 4.2	(127)	(152)
Charitable activities	4.3	(852)	(270)
Other expenditure	4.4	(3)	(4)
Total expenditure		(982)	(426)
Net gains/( losses) on investments	9	134	(21)
Net income/(expenditure) and net movement in funds		474	267
Reconciliation of funds:
Total funds brought forward		1,687	1,420
Total funds carried forward		2,161	1,687

All the Charity's funds are unrestricted.

Page 17

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Balance Sheet as at 31 March 2021

Notes Total at 31 March 2021 £000 Fixed Assets Investments 1.10, 6.1, 6.2 780 Total Fixed Assets 780 Current Assets Debtors 7.1 255 Stock 9 Cash at bank and in hand 2,344 Total Current Assets 2,608 Creditors: Amounts falling due within one year 8.1 (1,227) Net Current Assets 1,381 Total Assets less Current Liabilities 2,161 Total Net Assets 2,161 Funds of the Charity Income Funds: Unrestricted 9.0 2,161 Total Funds 2,161	Total at 31 March 2020 £000 646
	646
	0 4 1,287
	1,291
	(250)
	1,041
	1,687
	1,687
	1,687
	1,687

The Financial statements on pages 17 to 27 were approved by the Trustee and authorised for issue on and are signed on their behalf by:

Signed:

Date: 24/09/2021

Page 18

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Statement of Cash Flows for the year ended 31 March 2021

Cash flows from operating activites: Net cash provided by (used in) operating activities Cash flows from investing activities: Dividends and interest from investments Net cash provided by (used in) investing activities Change in cash and cash equivalents in the reporting period Cash and cash equivalents at the beginning of the reporting period Cash and cash equivalents at the end of the reporting period Reconciliation of net income/(expenditure) to net cash flow from operating activities: Net income/(expenditure) for the reporting period (as per the statement of financial activities) Adjusted for: (Gains)/losses on investments Dividends and interest from investments (Increase)/decrease in stock (Increase)/decrease in debtors Increase/(decrease) in creditors Net cash provided by (used in) operating activities Analysis of cash and cash equivalents: Cash at bank and in hand Total cash and cash equivalents

2020-21 2019-20 Total Total Funds Funds £000 £000 1,033 305 24 25 24 25 1,057 330 1,287 957 2,344 1,287 2020-21 2019-20 £000 £000 474 267 (134) 21 (24) (25) (5) (1) (255) 12 977 31 1,033 305 2020-21 2019-20 £000 £000 2,344 1,287 2,344 1,287

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Notes to the Account

Accounting Policies

1

1.1 Accounting Convention

The financial statements have been prepared on the basis of historic cost convention, as modified for the revaluation of certain investments. The financial statements have also been prepared in accordance with Accounting and Reporting by Charities Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard (FRS 102) (effective 1 January 2019) and applicable UK accounting standards and the Charities Act 2011.

1.2 Funds Structure

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by the donor. Where the restriction requires the gift to be invested to produce income but the Trustee has the power to spend the capital, it is classed as expendable endowment. Liverpool Heart & Chest Hospital Charity does not have any restricted funds or expendable endowments.

Unrestricted income funds comprise those funds which the Trustee is free to use for any purpose in furtherance of the charitable objects. Unrestricted funds include designated funds, where the donor has made known their non binding wishes or where the Trustee, at their discretion, have created a fund for a specific purpose.

1.3 Income Recognition

All incoming resources are included in full in the Statement of Financial Activities as soon as the following three factors can be met:

• i) entitlement - arises when control over the rights or other access to the economic benefit has passed to the Charity;

• ii) probable - when it is more likely than not that the economic benefits associated with the transaction or gift will flow to the Charity; and

• iii) measurement - when the monetary value or amount of the income can be measured reliably and the costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

1.4 Income from Donations and Legacies

Legacies are accounted for as incoming resources either upon receipt or where the receipt of the legacy is normally probable. This will be when:

• i) there has been a grant of probate;

• ii) the executors have established that there are sufficient assets in the estate, after settling any liabilities, to pay the legacy; and

• iii) any conditions attached to the legacy are either within the control of the charity or have been met.

There are no material legacies which have been notified but not recognised as incoming resources in the Statement of Financial Activities.

Page 20

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

1.4 Income from Donations and Legacies (cont'd) Turnover from the Tea Shop was £45k in 2007/08 which falls within the £50k

a) Donations

• i) All funds are unrestricted but may be designated. These include donations where particular parts of Liverpool Heart and Chest Hospital or its activities were nominated by the donor at the time that the donation was made. Whilst nomination is not binding on the Trustee, the designated funds reflect these nominations. The Charity does not have any restricted funds.

ii)

Where a preference is not expressed by the donor then the donation is applied to Liverpool Heart and Chest Appeal which has four key elements to our fundraising aims;

• To raise funds for key pieces of medical equipment

• To develop the Enhancing the Healing Environment programme

• To support patient centred research

• To continually invest in our staff to improve their clinical techniques so that we can provide our patients with an unrivalled patient experience.

iii) Where possible the Trust reclaims tax on donations through the Gift Aid scheme.

1.5 Income from Charitable activities

a) Robert Owen House Accommodation Income

• i) Robert Owen House provides inexpensive overnight accommodation for relatives and friends of patients. Income received is applied to the upkeep and day to day running costs of the house.

• ii) Robert Owen House accommodation income is credited to incoming resources from Charitable Activities within the Statement of Financial Activities.

• iii) Robert Owen House Income is credited net of VAT based on the date of occupancy.

• iv) The Charity has treated income from Robert Owen House as Primary Purpose Trading and as such the profits are exempt from tax.

Page 21

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

1.6 Expenditure

The funds held on Trust accounts are prepared in accordance with the accruals concept. All expenditure is recognised when all of the following criteria are met:

i) obligation - a present legal or constructive obligation exists at the reporting date as a result of a past event;

ii) probable - it is more likely than not that a transfer of economic benefits, often cash, will be required in settlement; and iii) measurement - the amount of the obligation can be measured or estimated reliably.

Grants are mainly made to Liverpool Heart and Chest Hospital NHS Foundation Trust in furtherance of the charitable objects of the funds. A liability for such grants is recognised when approval had been given by the Trustee. The Foundation Trust has full knowledge of the plans of the Trustee, therefore a grant approval is taken to constitute a firm intention of payment which has been communicated to the Foundation Trust, and so a liability is recognised. Expenditure on raising funds comprises the costs associated with attracting voluntary income. Expenditure on Charitable activities comprises those costs incurred by the Charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and any costs of an indirect nature necessary to support them.

Governance costs include only those costs associated with meeting the constitutional and statutory requirements of the charity and include audit fees and costs linked to the strategic management of the charity.

1.7 Irrecoverable VAT

Irrecoverable VAT is charged against the category of resources expended for which it is incurred.

1.8 Governance Costs

Establishment costs and Audit fees are apportioned to resources expended based on the value of transactions within each cost category at the end of the year.

1.9 The Costs of Raising Funds

These costs are salaries and other expenses associated with the Liverpool Heart and Chest Charity Fundraising Team and day to day expenses incurred in running Robert Owen House.

1.10 Fixed Asset Investments

Investments are stated at market value at the balance sheet date.

1.11 Gains and Losses

All gains and losses are taken to the Statement of Financial Activities as they arise. Realised gains and losses on investments are calculated as the difference between sales proceeds and opening market value (or date of purchase if later). Unrealised gains and losses are calculated as the difference between market value at the year end and opening market value (or date of purchase if later).

1.12 Change in the Basis of Accounting

There has been no change in the basis of accounting this financial year.

Page 22

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

2.0 Related Party Transactions

Under the guidance provided by the Financial Reporting Standard 8, Liverpool Heart & Chest Hospital NHS Foundation Trust is a related party as it is the Corporate Trustee of the charity. During the year the charity has had a number of material transactions with Liverpool Heart & Chest Hospital NHS Foundation Trust (e.g. grant giving). Details are included in note 12.

The Foundation Trust is the sole Trustee of the Liverpool Heart and Chest Charity and as such is considered to be a related party. During the year ended 31 March 2021, the Charity incurred £763k in expenditure and received £0k of income with the NHS Foundation Trust. Amounts owed by the Foundation Trust at 31 March 2021 were £0k and amounts owed to the Foundation Trust were £1,227K.

The Charitable Trust has made revenue payments to Liverpool Heart & Chest Hospital NHS Foundation Trust where agents of the Corporate Trustee (whose names are listed below) are also members of the Trust Board.

Bob Burgoyne - Chair of Charitable Funds Committee Jane Tomkinson - Chief Executive Karen Edge - Chief Finance Officer Nick Brooks - Non Executive Director Julian Farmer - Non Executive Director Lucy Lavan - Associate Director of Corporate Affairs

The Trustee's did not receive any remuneration for work performed in relation to the Charity (2020-21: £nil).

Page 23

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity- 2020/21
Grants made 3.1 to institutions Name of recipient and number of grants Total resources expended Less cost of generating funds Less grants paid to individuals Less admin/audit and bank charges Liverpool Heart & Chest Hospital NHS FT Trust	Aggregate amount paid 2021 £000 (982) 122 35 (825)	Aggregate amount paid 2020 £000 (426) 142 33
		(251)

Analysis of 4.1 Support costs are reapportioned across expenditure. The apportionment is based on the value of transactions within each of the Support expenditure categories reported. Costs

The total value of support costs incurred in the reporting period is £32k and comprises £1k Establishment costs, £5k Audit fee and £26k Staffing Costs.

Expenditure on 4.2 Raising Funds

Total costs 2021 £000 Fund raising costs (126) (126) Included within the cost of raising funds are the following staff costs: Net Cost National Insurance Employer £000 £000 Fundraising Staff 83 9	Total funds raised 2021 £000 1,297 1,297 Pension Employer £000	Total costs 2020 £000 (152) (152) Gross Cost 2021 £000	Total funds raised 2020 £000 625
			625
			Gross Cost 2020 £000
		92	102

The average number of staff employed during the year was 2 (2019/20: 3).

Robert Owen House Supplies has been reclassified as a charitable activities expenditure.

Charitable activities 4.3

Staff Welfare Contribution to Liverpool Heart & Chest research Purchase of new equipment Patient welfare Education, training and research expenses New building and refurbishment Expenditure Robot Running Costs Robert Owen House Repairs Robert Owen House Supplies	Total 2021 £000 (221) (145) (133) (9) 0 (233) 0 (48) 4 (67) (852)	Total 2020 £000 (43) (21) 0 (8) (79) 0 0 0 (38) (81)
		(270)

Other expenditure 4.4

Miscellaneous expenditure	Total 2021 Funds £000 (3) (3)	Total 2020 Funds £000 (4)
		(4)

Note: Miscellaneous expenditure mainly consists of bank charges.

Page 24

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Net movement 5 in Funds Analysis of 6 Fixed Asset 6.1 Investments 6.2 Analysis of 6.3 gross income from investments 6.4	Opening Balance Closing Balance Net movement in funds for the year Net movement in funds available for future activities		Total 2021 Funds £000 1,687 2,161 474 474	Total 2020 Funds £000 1,420 1,687 267 228
	Fixed Asset Investments: Market value at 1st April Net gain/(loss) on revaluation Market value at 31 March Historic cost at 31 March		2021 £000 646 134 780 400	2020 £000 667 (21) 646 400
	Market value at 31 March : Investments in a Common Deposit Fund / Common Investment Fund	Held in UK £000 780 780	2021 Total £000 780 780	2020 Total £000 646 646
	Total gross income Investments in a Common Deposit Fund / Common Investment Fund	Held in UK £000 134	2020-21 Total £000 134	2019-20 Total £000 21 21
		134	134
	Income from Charitable activities Income from Robert Owen House accommodation/telephone charges and fundraising sales		2020-21 Total £000 1	2019-20 Total £000 64 64
			1

25

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

6.5 Other income

Interest on short term deposit	2021 Total £000 0	2020 Total £000
		0

The Corporate Trustees adopted the Treasury Management Policy of Liverpool Heart & Chest Hospital NHS FT & Chest Hospital NHS FT in respect of investments. The majority of cash balances are placed with Barclays, which attracts an interest rate of 0.14%.

Analysis of 7 Debtors

Debtors (including trade debtors and loans receivable) are measured on initial recognition at settlement amount after any trade discounts or amount advanced by the charity. Subsequently, they are measured at the cash or other consideration expected to be received.

7.1 Donations and legacies Other debtors Prepayments Total debtors falling due within one year Total debtors	2021 £000 252 0 3 255 255	2020 £000 0 0 0
		0
		0

Analysis of 8 Creditors

8.1

The charity has creditors which are measured at settlement amounts less any trade discounts.

Amounts falling due within one year: Trade creditors Accruals Balance owed to Liverpool Heart & Chest Total creditors falling due within one year Total creditors	2021 £000 0 (1,047) (180) (1,227) (1,227)	2020 £000 (11) (72) (167)
		(250)
		(250)

26

Charitable Trust Accounts - Liverpool Heart & Chest Hospital Charity - 2020/21

Details of 9.0 material designated funds - Unrestricted funds Contingencies 10 Commitments, 11 Liabilities and Provisions 11.1 Trustee and 12 Connected Persons 12.1 Transactions 12.2 Loans or 13 Guarantees Secured against assets of the charity	Name of fund Balance Incoming Resources Gains Balance b/fwd resources expended and c/fwd 01 April 2019 (losses) 31 March 2021 £000 £000 £000 £000 £000 A Robert Owen House 151 58 68 3 144 B Heart Appeal 234 5 4 9 244 C LHCH Charity 760 1,247 879 69 1,197 D Lung Cancer 69 1 1 2 71 C Robotics Fund 266 0 46 1 221 Material funds are deemed at being in excess of £50,000 Robert Owen House provides inexpensive relatives accommodation. The LHCH Charity is for any charitable purpose or purposes relating to services provided by LHCH NHS FT. The Lung Cancer funds facilitates education and research into adult lung cancer and provides support for patients with this condition. The Robotics Fund was created for a specific campaign in 2017-18 to fund a Davinci Robot purchased to improve outcomes and recovery time for patients The Heart Appeal purchases equipment on behalf of the Liverpool Heart & Chest Hospital NHS Foundation Trust. The
	There are no contingent losses or gains included in the accounts
	There are no commitments, contingent liabilities or provisions included in 2020-21 There are no commitments or provisions included in the accounts
	The Charitable Trust delivers the charitable objectives by making grants to the £825k in 2020/2021 (2019/20 £251k). At 31st March 2021, £1,227k was owed to the Liverpool Heart & Chest Hospital NHS Foundation Trust (2019/20 £239k). There was no Trustee indemnity insurance during the year. Liverpool Heart & Chest Hospital NHS Foundation Trust. Grants made amounted to
	There were no loans or guarantees secured against assets of the Charity.

27

Liverpool Heart and Chest Hospital Charity

INDEPENDENT AUDITOR'S REPORT

TO THE TRUSTEES OF LIVERPOOL HEART AND CHEST HOSPITAL CHARITY

Opinion

We have audited the financial statements of Liverpool Heart and Chest Hospital Charity (the ‘charity’) for the year ended 31 March 2021 which comprise the statement of financial activities, the balance sheet, the statement of cash flows and the 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:

• give a true and fair view of the state of the charity’s affairs as at 31 March 2021 and of its incoming resources and application of resources, for the year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• have been prepared in accordance with the requirements of the Charities Act 2011.

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 charity’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 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 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 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.

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Liverpool Heart and Chest Hospital Charity

INDEPENDENT AUDITOR'S REPORT

TO THE TRUSTEES OF LIVERPOOL HEART AND CHEST HOSPITAL CHARITY

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

• the information given in the financial statements is inconsistent in any material respect with the trustees' report; or

• sufficient accounting records have not been kept; or

• the financial statements are not in agreement with the accounting records; or

• we have not received all the information and explanations we require for our audit.

Responsibilities of trustees

As explained more fully in the statement of trustees' responsibilities, the trustees 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 charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a 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.

Enquiries of management and those charged with governance were held in order to identify any laws and regulations that could be expected to have a material impact on the financial statements. Throughout the audit, the team were updated with the outcomes of these enquiries including consideration as to where and how fraud may occur in the company.

The audit procedures undertaken to address any potential risk in relation to irregularities (which include fraud and non-compliance with laws and regulations) included: enquiries of management and those charged with governance on how the company complies with relevant laws, regulations and any cases actual or potential litigation or claims; examination of appropriate legal correspondence; review of board minutes; testing of journal entries for appropriateness; and analytical procedures on account balances to identify variances against expectation which may show indications of fraud.

No instances of material non-compliance were identified, although the prospect of detecting irregularities, including fraud, is inherently difficult. This is due to; difficulty in detecting irregularities; limits imposed by the effectiveness of the entity’s controls; and the nature, timing and extent of the audit procedures performed. Irregularities as a result of fraud are inherently more difficult to detect than those that result from error. Despite this the audit has being planned and performed in accordance with ISAs (UK), there is an unavoidable risk that material misstatements may not be detected.

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

• 29 -

Liverpool Heart and Chest Hospital Charity

INDEPENDENT AUDITOR'S REPORT

TO THE TRUSTEES OF LIVERPOOL HEART AND CHEST HOSPITAL CHARITY

Other matters

Your attention is drawn to the fact that the charity has prepared financial statements 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)" (as amended) in preference to the Accounting and Reporting by Charities: Statement of Recommended Practice issued on 1 April 2005 which is referred to in the extant regulations but has now been withdrawn.

This has been done in order for the financial statements to provide a true and fair view in accordance with current Generally Accepted Accounting Practice.

Other matters which we are required to address

The prior year financial statements were subject to independent examination, as a result the prior year financial statements were not audited.

Use of our report

This report is made solely to the charity’s trustees, as a body, in accordance with part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity's trustees those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

McLintocks (NW) Limited

.........................

Chartered Accountants Statutory Auditor

2 Hilliards Court Chester Business Park Chester Cheshire CH4 9PX

McLintocks (NW) Limited is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under of section 1212 of the Companies Act 2006.

• 30 -