OpenCharities

This text was generated using OCR and may contain errors. Check the original PDF to see the document submitted to the regulator.

2020-12-31-accounts

Registered number: 03244113 Charity number: 1058769

Petworth Cottage Nursing Home

(A company limited by guarantee)

Trustees' report and audited financial statements For the year ended 31 December 2020

Petworth Cottage Nursing Home

(A company limited by guarantee)

Contents

Page
Reference and administrative details of the charity, its trustees and advisers 1
Trustee directors' report 2 - 6
Trustee directors' responsibilities statement 7
Independent auditors' report on the financial statements 8 - 12
Statement of financial activities 13
Balance sheet 14
Statement of cash flows 15
Notes to the financial statements 16 - 33

Petworth Cottage Nursing Home

(A company limited by guarantee)

Reference and administrative details of the Charity, its trustees and advisers For the year ended 31 December 2020

Trustee directors Mr C R Hubbard, Chairman
Mr A W Brooke
Mr T R W Longmore
Dr S Pett
Mr D H M Burrell
Dr G Lyons
Miss S E Spriggs
Mr T J Barrington
Dr A J Smoker
Company registered
number
03244113
Charity registered
number
1058769
Registered office
Wisteria House
Market Square
Petworth
West Sussex
GU28 0AJ
Company secretary
T R W Longmore
Patron
Lady Egremont
Independent auditors
Kreston Reeves LLP
Chartered Accountants
Statutory Auditor
Springfield House
Springfield Road
Horsham
West Sussex
RH12 2RG
Bankers
NatWest Bank Plc
5 East Street
Chichester
West Sussex
PO10 1HH
Solicitors
Anderson Rowntree
Wisteria House
Market Square
Petworth
West Sussex
GU28 0AJ

Page 1

(A company limited by guarantee)

Petworth Cottage Nursing Home

Trustee directors' report For the year ended 31 December 2020

The Trustee directors present their annual report together with the audited financial statements of the Charity for the year 1 January 2020 to 31 December 2020. The Annual report serves the purposes of both a Trustees' report and a directors' report under company law. The Trustees confirm that the Annual report and financial statements of the charitable company comply with the current statutory requirements, the requirements of the charitable company's governing document and the provisions of the Statement of Recommended Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) (effective 1 January 2019).

Since the Charity qualifies as small under section 382 of the Companies Act 2006, the Strategic report required of medium and large companies under the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 has been omitted.

Structure, governance and management

The charity is a company limited by guarantee and was set up in August 1996. It is governed by a Memorandum and Articles of Association dated 19 August 1996. It succeeds a charity with similar objects and assets set up by a Trust Deed dated 24 November 1971.

The trustee directors named on page 1 have served throughout the year and to date.

The charity’s Articles of Association govern the appointment of the trustee directors and the filling of vacancies. New trustee directors are recruited by personal contact, being persons known to the Chairman or other trustee directors as having knowledge and experience which will enable them to make a significant contribution to the running of the charity. They will be given informal instruction in their duties and responsibilities and encouraged to study the appropriate Charity Commission and other instructional papers.

The day to day running of the nursing home is under the management of the Nursing Home Manager, Mrs Yvonne Stout. Financial administration and operational support is provided by Mrs. Kate Cooper as Finance Manager and both are salaried. Expenditure over £10,000 requires board approval. The board of trustee directors meet 6 times per year, receives reports from the nursing home manager, finance manager and Doctor, reviews performance and considers issues as they arise.

Key management personnel

The arrangements for setting the pay and remuneration of the charity’s key personnel, consisting of the nursing home manager, her deputy and the finance manager is resolved by the Chairman with the involvement and approval of the trustees. Subsequent enhancements for all staff members including senior management are agreed by the remuneration committee comprising the Chairman of the Trustees, the nursing home manager, the finance manager and the lead trustee for finance using bench marks such as inflation and the National Living Wage.

Financial review

In 2020, there was an operating deficit of £116,361 and an overall surplus of £5,257 leading to an increase in the total reserves held. The income received from residents rose by 3.61% with average occupancy of 29.13 residents.

Page 2

Petworth Cottage Nursing Home (A company limited by guarantee)

Trustee directors' report (continued) For the year ended 31 December 2020

Investment policy and performance

The investment policy of Petworth Cottage Nursing Home (PCNH) proposed by the Investment Committee and approved by the Board is briefly:

i) To hold approximately 4 months costs of the Home on deposit to cover an unforeseen shortfall in operating funds or other emergency

ii) To invest 2/3 of the remainder of our reserves to generate capital appreciation. iii) To invest the remaining 1/3 to generate income.

PCNH proposed for category ii) above investment in M and G Charifund and for category iii) above investment in M and G Charibond and later in Edentree Annuity Balanced Fund and Edentree Global Equity Income Fund. PCNH took informal advice from a member of the London Stock Exchange.

PCNH therefore now holds:-

22,966 units in M and G Charifund worth on 31 December 2020 £315,222 132,658 units in M and G Charibond worth on 31 December 2020 £166,459 176,689 units in Edentree Amity Balanced Fund worth on 31 December 2020 £188,173 87,674 units in Edentree Amity Global Equity Fund worth on 31 December 2020 £130,108

The total funds invested as at 31 December 2020 being £799,962.

The Covid Pandemic has caused and continues to do so, greater than usual volatility in the value of these investments during 2021. We shall review our current portfolio and consider with caution alternative options.

Future plans

The Trustee Directors and Management Team will endeavour to sustain occupancy levels. A major consideration and concern is recruiting and retaining both nursing and caring staff. The Budget for 2021 is based upon a bed occupancy of 29. This compares with 18 in 2013, 23 in 2014, 28 in 2015, 28.5 in 2016, 29.5 in 2017, 28.89 in 2018, 28.76 in 2019 and 29 in 2020.

Reserves policy

The financial policy of the charity is to continue to hold reserve funds not only to cover maintenance and renewal of the buildings and equipment of the charity but to also ensure a strong balance sheet to mitigate the impact of any weakness in the market during the current and continuing recessionary period. It is considered politic and sound management to ensure that reserves do not fall below £800,000 in order to be able to meet at least six months expenditure and potential repairs to the property. Total unrestricted funds were £2,930,462 and after taking account of £1,831,787 tied up in fixed assets, uncommitted reserves at the year end were £1,098,675.

Page 3

(A company limited by guarantee)

Petworth Cottage Nursing Home

Trustee directors' report (continued) For the year ended 31 December 2020

Risk assessment

The trustee directors are conscious of the need to review and determine the risks inherent in the management of the home and to establish corrective actions and systems to mitigate the risks. The trustee directors continue to carry out risk assessment which is reviewed on an annual basis. Through these procedures, the trustee directors are satisfied that the major risks identified have been adequately mitigated where necessary.

It is categorised under:

(1) Medium likelihood/high impact

(2) Low likelihood/high impact

t is categorised under:
1) Medium likelihood/high impact
2) Low likelihood/high impact
3) Low likelihood/medium impact		 t is categorised under:
1) Medium likelihood/high impact
2) Low likelihood/high impact
3) Low likelihood/medium impact		 t is categorised under:
1) Medium likelihood/high impact
2) Low likelihood/high impact
3) Low likelihood/medium impact
Description of risk Category Plans and strategies for managing risk
Shortage of staffing in the Nursing
home sector
(1)		 - Reducing dependency on agency staff
Sudden loss of senior staff (1) - Separate roles for Matron and Deputy Matron are in place so
the likelihood of the sudden loss of both is reduced
-Newly appointed Matron/Manager is registered with the Care
Quality Commission under relevant regulations
Financial crisis (1)
- Bed occupancy levels have improved
- Investment of funds in M & G Charifund and Charibond, and
Edentree Amity Global Equity Fund and Amity Balanced Fund
generating a return for the charity
Electricity failure (1)
- Second generator installed that cuts in automatically if main
supply fails
Natural disaster; such as fire or
lightning strike		 (2)
- The home is equipped with fire extinguishers
-Disaster recovery plan is in place

Misbehaviour by member of staff		 (2)
- Training and checks carried out for all staff
- Disciplinary procedure in place in case of an event arising
Failure of IT systems (3) - Patient care records back up on cloud
-Regular back ups of accounts records
Failure of cookingequipment (3)
- Offsite suppliers of hot food available
Injury to patient/staff from:
(i) Fall
(ii) Wrongful adminstering of drugs
(iii) Financial and Stores fraud
leading to financial difficulty
(3)		 (i) Care staff all receive first aid training
(ii) Drugs administered by trained nurses only in accordance to
doctor's prescription
(iii) Accounts audited by professional accountants and monthly
accounts and bank reconciliations prepared

Public benefit

The Trustee Directors have had due regard to the Charity Commission guidance on public benefit whilst setting the objects and activities of the Charity.

PCNH’s fees continue to reflect our charitable status as a non-profit organisation. Fees charged reflect the full nursing status of the Home and are generally below that of similar Nursing Homes. In 2020 PCNH admitted 69 new Residents, of these 20 Residents were admitted through Social Services (SS) or Continuing Health Care (CHC) and these were subsidised by PCNH, the shortfall from SS being 22% and CHC 15% per Resident beneath our ‘break-even’ weekly fee (BEWF). As a result of this during the year our Charity, PCNH, has assisted and supported some 29 Residents with their fees.

It is the intention of the Trustees and Management to continue to monitor the contribution for the public benefit and, should conditions and funds allow, to increase the number of Residents admitted on this basis.

Page 4

(A company limited by guarantee)

Petworth Cottage Nursing Home

Trustee directors' report (continued) For the year ended 31 December 2020

Objects, objectives and principal activities

The charity’s objects are the relief of sickness and infirmity through the provision of nursing care, and without prejudice to the generality of the foregoing to provide a short stay nursing and convalescent home for the benefit of any disabled or sick person upon terms appropriate to their means, and to provide medical and/or nursing care of limited duration for any disabled or sick person upon terms appropriate to their means.

Achievements and performance

Throughout the year the Charity has fulfilled the objectives set out above. The Residents continue to benefit from the continuing refurbishment and enhancement programme of the accommodation under the guidance of the Refurbishment Committee, the Nursing Home Manager (Matron) and the Finance Manager.

REVIEW OF YEAR

As I write this in early September 2021 I reflect that this has been and continues to be, a truly testing and demanding time for all our Team; perhaps most of all for our Carers and Nursing Team who have not only had to cherish, nurse and support our Residents but at the same time safeguarding themselves and caring for their families, many of whom are of school age. They have risen to the challenge wonderfully with great good humour, with a will to overcome and support one another, a real team effort with the result that all Residents have remained Covid free…… Bravo !! Bravo !!

Fund raising activities

PCNH benefits enormously from the activities of the Friends of Petworth Cottage Nursing Home (The Friends). Unsurprisingly 2020 has proved to be a very challenging year in terms of opportunities for organising fund raising. Amazingly, once counting completed in 2021, they have succeeded in surpassing the total for 2019, through such activities as:-

Christmas Quiz £ 34,330 (a record)
Blue Tins £ 429
Newsletter £ 19,476
Pattie Blue Tin £ 67

Very sadly both 2020 and 2021 have been very restricting in allowing The Friends to reach out in their role as ‘Ambassadors’ to the wider supporters. No Alfresco lunch, no Winter Fair, both of which allow us to widen our network of supporters and contributors. Roll on 2022! The Board is hugely grateful and appreciative for all these contributions. These gifts, activities and very, very generous donations absolutely allow PCNH to fulfil its responsibility as a Charity for the benefit of the community of Petworth and beyond.

Finally, the ethos of PCNH is dependant upon the professionalism of its Staff, led by the Nursing Home Manager, (Matron) Yvonne Stout and her Management Team. They have ’shone’ in a very challenging year and the Trustees are immensely grateful.

Page 5

Petworth Cottage Nurnlng Home (A ¢ompany Ilmited by gu¥rantee) Truste• dire¢tOfs' report (continued) For the year ended 31 DeGember 2020 Dlsclosure of Inforniation to the audito We, the Trustee directors of the charitable company who held office at the dale of approval of these Financial Statements as $et out above each confim, so far as we are aware, that.. - there is fbo relevant audit information of which the charitable company's auditors are unaware; and - we havo taken all the steps that we ought to have taken as Trustee directors in order to make ourselves aware of any relevant audit infomialion and to establish that the charitable companrfs audiloTS are aware of that infomialion. port was approved by the TfLbslee directors on and s￿ned on their behalf ty". Mr C Hubbard. Chairman Page 6

Petworth Cottage Nursing Home

(A company limited by guarantee)

Statement of Trustee directors' responsibilities For the year ended 31 December 2020

The Trustee directors (who are also the directors of the Charity for the purposes of company law) are responsible for preparing the Trustee directors' report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the Trustee directors to prepare financial statements for each financial year. 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 its incoming resources and application of resources, including its income and expenditure, 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.

Page 7

Petworth Cottage Nursing Home (A company limited by guarantee)

Independent auditors' report to the Members of Petworth Cottage Nursing Home

Opinion

We have audited the financial statements of Petworth Cottage Nursing Home (the 'Charitable Company') for the year ended 31 December 2020 which comprise the Statement of financial activities, the Balance sheet, the Statement of cash flows and the related notes, 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Charitable Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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 Trustee directors' 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 Trustee directors with respect to going concern are described in the relevant sections of this report.

Page 8

Petworth Cottage Nursing Home (A company limited by guarantee)

Independent auditors' report to the Members of Petworth Cottage Nursing Home (continued)

Other information

The other information comprises the information included in the Annual report other than the financial statements and our Auditors' report thereon. The Trustee directors are responsible for the other information contained within the Annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially 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.

Matters on which we are required to report by exception

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

Responsibilities of trustees

As explained more fully in the Trustee directors' responsibilities statement, the Trustee directors (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 Trustee directors 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 Trustee directors 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 Trustee directors either intend to liquidate the Charitable Company or to cease operations, or have no realistic alternative but to do so.

Page 9

Petworth Cottage Nursing Home (A company limited by guarantee)

Independent auditors' report to the Members of Petworth Cottage Nursing Home (continued)

Auditors' 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 Auditors' 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:

Capabilities of the audit in detecting irregularities, including fraud

Based on our understanding of the Charitable Company, and through discussion with the trustees and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery and employment law. 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 Charities Act 2011, the Companies Act 2006, Statement of Recommended Practice, Care Quality Commission regulations and pension legislation. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. 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 management bias in accounting estimates and judgemental areas of the financial statements such as the valuation of investment properties. Audit procedures performed by the engagement team included:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions Page 10

Petworth Cottage Nursing Home

(A company limited by guarantee)

Independent auditors' report to the Members of Petworth Cottage Nursing Home (continued)

reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Page 11

Petworth Cottage Nursing Home (A company limited by guarantee)

Independent auditors' report to the Members of Petworth Cottage Nursing Home (continued)

Use of our report

This report is made solely to the Charitable Company'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 Charitable Company'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 Charitable Company and its members, as a body, for our audit work, for this report, or for the opinions we have formed.

Kreston Reeves LLP

Chartered Accountants Statutory Auditor Springfield House Springfield Road Horsham West Sussex RH12 2RG

Date: 28 September 2021

Kreston Reeves LLP are eligible to act as auditors in terms of section 1212 of the Companies Act 2006.

Page 12

Petworth Cottage Nursing Home

(A company limited by guarantee)

Statement of financial activities (incorporating income and expenditure account) For the year ended 31 December 2020

Note
Income from:
Donations and legacies
4
Charitable activities:
. Other charitable activities
Investments
5
Total income
Expenditure on:
Raising funds
Charitable activities:
6,7
Provision of a residential care home
Governance
Total expenditure
Net (expenditure)/income before net
(losses)/gains on investments
Net (losses)/gains on investments
12,13
Net (expenditure)/income before
taxation
Transfers between funds
18
Net movement in funds
Reconciliation of funds:
Total funds brought forward
Net movement in funds
Total funds carried forward		 Operating
funds
2020
£
64,159
1,448,118
-
1,512,277
-
1,622,638
6,000
1,628,638
(116,361)
-
(116,361)
116,361
-
-
-
-		 General
funds
2020
£
134,009
-
38,809
172,818
9,457
-
-
9,457
163,361
(41,743)
121,618
(116,361)
5,257
2,925,205
5,257
2,930,462		 Total
funds
2020
£
198,168
1,448,118
38,809
1,685,095
9,457
1,622,638
6,000
1,638,095
47,000
(41,743)
5,257
-
5,257
2,925,205
5,257
2,930,462		 Total
funds
2019
£
102,874
1,397,639
46,829
1,547,342
9,851
1,517,680
6,400
1,533,931
13,411
93,342
106,753
-
106,753
2,818,452
106,753
2,925,205

The Statement of financial activities includes all gains and losses recognised in the year. The notes on pages 16 to 33 form part of these financial statements.

Page 13

pe￿Orth Cottage Nursing Home (A company limited by guaranteo) Registered number: 03244113 Balance sheet As al 31 December 2020 2020 2019 Noto FIX￿ assgts Tangible assets Investments Investment property 11 12 13 1,571,787 799,962 260,000 1.551,048 871.704 230,000 2,631.749 2.652,752 Curnnt assets Stocks 14 15 2,109 142,036 229,653 Debtors Cash at bank and in hand 151,953 252.908 409.470 373,798 Cieditors.. amounts falling due within one year 16 (110,757) {101.345) Net ¢urrent assots 298,713 272,453 Totsl nel assets 2,930,462 2.925,205 CharSty fund8 Restricted funds 18 2,930,462 2.925,205 Total funds 2,930,462 2,925,205 The entity was enlitsed lo exemption from audit under section 477 of the Companies Act 2006 and the member5 have not required the entity to obtsin an audit for the year in question in accordan￿ wth section 476 of the Companies Act 2006. However, an audit is required in accordan￿ with section 144 of the Charities Act 2011. The Trustee directors acknowledge their responsibilities for comptying with the requirements of the Act with resped lo accounting records and preparation of financial slatemenls. The financial statements have been prepared in accordance with the provisions applicable lo enlities subject lo the small companie5 regime. The financial statements were approved and authorised for issue by the Trustee directors on £q i o q 110 il and signed on their behalf by: Alrc Hubba . Chal The noles on page fomi p anoa ststements. Page 14

Petworth Cottage Nursing Home

(A company limited by guarantee)

Statement of cash flows For the year ended 31 December 2020

Note
Cash flows from operating activities
Net cash used in operating activities
19
Cash flows from investing activities
Dividends, interests and rents from investments
Proceeds from the sale of tangible fixed assets
Purchase of tangible fixed assets
User text
Net cash used in investing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
20		 2020
£
50,293
38,310
7,150
(72,997)
499
(27,038)
23,255
229,653
252,908		 2019
£
22,254
46,063
-
(47,376)
766
(547)
21,707
207,946
229,653

The notes on pages 16 to 33 form part of these financial statements

Page 15

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

1. General information

Petworth Cottage Nursing Home is a charitable company registered in the United Kingdom. The address of the registered office is given in the charity information page 1 of these financial statements.

The financial statements are prepared in sterling which is the functional currency of the charity and rounded to the nearest £.

2. Accounting policies

2.1 Basis of preparation of financial statements

The financial statements have been prepared in accordance with the Charities SORP (FRS 102) - 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) (effective 1 January 2019), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Petworth Cottage Nursing Home 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.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

2.2 Going concern

Having reviewed the funds available to the Charity, together with the expected ongoing demand for places and the Charity's projected cash flows, the Trustee directors have a reasonable expectation that the charitable company has adequate resources to continue in operational existence.

Due to its unprecedented impact on the wider economy, it is difficult to evaluate with any certainty the final potential outcomes on the charitable company of the COVID-19 virus. However, taking into consideration the UK Government’s response and the charitable company’s planning, the Trustee directors have a reasonable expectation that the charitable company will continue in operational existence for the foreseeable future.

2.3 Company status

The Charity is a company limited by guarantee. The members of the company are the Trustee directors named on page 1. In the event of the Charity being wound up the liability in respect of the guarantee is limited to £10 per member of the Charity.

Page 16

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

2. Accounting policies (continued)

2.4 Income

All income is recognised once the Charity has entitlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably.

Patients' fees include all fees receivable for the year.

Legacies are recognised on a case by case basis following the granting of probate and based on when the charity has been notified in writing of both the amount and the settlement date of the gift.

Donations are recognised when the charity has been notified in writing of both the amount and settlement date. The income from fundraising is shown gross, with the associated costs included in fundraising costs.

Investment income is earned through holding assets for investment purposes such as shares and property. Interest income is recognised using the effective interest method and dividend and rent income is recognised as the charity's right to receive payment is established.

Grants, including government grants, are included in the Statement of financial activities on a receivable basis. The balance of income received for specific purposes but not expended during the period is shown in the relevant funds on the Balance sheet. Where income is received in advance of entitlement of receipt, its recognition is deferred and included in creditors as deferred income. Where entitlement occurs before income is received, the income is accrued.

2.5 Expenditure

Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. All costs have been allocated to activities on a basis consistent with the use of resource.

Expenditure on raising funds includes all expenditure incurred by the Charity to raise funds for its charitable purposes and includes costs of all fundraising activities events.

Expenditure on charitable activities is incurred on directly undertaking the activities which further the Charity's objectives, as well as any associated support costs and governance costs.

Support costs are those costs incurred directly in support of expenditure on the objects of the Charity and include project management carried out at Headquarters. Governance costs are those incurred in connection with administration of the Charity and compliance with constitutional and statutory requirements.

All expenditure is inclusive of irrecoverable VAT.

2.6 Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the Charity; this is normally upon notification of the interest paid or payable by the institution with whom the funds are deposited.

Page 17

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

2. Accounting policies (continued)

2.7 Taxation

The charity is an exempt charity within the meaning of schedule 3 of the Charities Act 2011 and is considered to pass the tests set out in Paragraph 1 Schedule 6 Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes.

2.8 Tangible fixed assets and depreciation

Tangible fixed assets costing £100 or more are capitalised and recognised when future economic benefits are probable and the cost or value of the asset can be measured reliably.

Tangible fixed assets are initially recognised at cost. After recognition, under the cost model, tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. All costs incurred to bring a tangible fixed asset into its intended working condition should be included in the measurement of cost.

Depreciation is charged so as to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives.

Depreciation is provided on the following bases:

At each balance sheet date the Trustee directors review the carrying amounts of the Charity's tangible fixed assets to determine whether there is an indication of impairment of those assets. If such an indication exists, the recoverable amount of the asset is estimated in order to assess whether any impairment loss has arisen. The recoverable amount is the higher of fair value less costs to sell and value in use as determined by the trustees. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount.

2.9 Investments

Fixed asset investments are a form of financial instrument and are initially recognised at their transaction cost and subsequently measured at fair value at the balance sheet date, unless the value cannot be measured reliably in which case it is measured at cost less impairment.

Investment properties are measured at fair value at each reporting date.

Gains and losses on fixed asset investments and investment properties, whether realised or unrealised, are combined and presented as “Net gains/(losses) on investments in the Statement of Financial Activities.

2.10 Stocks

Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks.

Page 18

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

2. Accounting policies (continued)

2.11 Debtors

Trade and other debtors are recognised at the settlement amount after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

2.12 Cash at bank and in hand

Cash at bank and in hand includes cash and short-term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

2.13 Liabilities and provisions

Liabilities are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably.

Liabilities are recognised at the amount that the Charity anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide.

2.14 Financial instruments

The Charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments of the Charity are initially recognised at transaction value and subsequently measured at their settlement value.

2.15 Pensions

The Charity operates a defined contribution pension scheme and the pension charge represents the amounts payable by the Charity to the fund in respect of the year.

2.16 Other employee benefits

When employees have rendered service to the Charity short term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service.

2.17 Fund accounting

General funds are unrestricted funds which are available for use at the discretion of the Trustee directors in furtherance of the general objectives of the Charity and which have not been designated for other purposes.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the Charity for particular purposes. The costs of raising and administering such funds are charged against the specific fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

Page 19

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

3. Critical accounting estimates and areas of judgement

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions:

The Charity makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Critical areas of judgement:

Expected useful life, and residual value of, freehold land and buildings

Tangible fixed assets are depreciated over their expected useful economic lives after taking into account the estimated residual value of the asset where significant. The residual values and useful economic lives are reassesed annually and may vary depending on a number of factors such as future maintenance programmes, future market conditions and changes in legislation.

Fair value of investment properties

Investment properties are measured at fair value at each reporting date. The fair value of investment properties is assessed by the Trustee directors.

4. Income from donations and legacies

Donations
Donations and legacies
Donations received via The Friends
Government grants		 Operating
funds
2020
£
-
-
64,159
64,159		 General
funds
2020
£
85,910
48,099
-
134,009		 Total
funds
2020
£
85,910
48,099
64,159
198,168

During the year government grants of £51,017 (2019: £nil) were received in relation to infection control, £6,914 (2019: £nil) in relation to support for social service residents, £3,728 (2019: £nil) in relation to the Coronavirus Job Retention Scheme and £2,500 (2019: £nil) in relation to statutory sick pay reclaimed.

Page 20

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

4. Income from donations and legacies (continued)

Donations
Donations and legacies
Donations received via The Friends		 General
funds
2019
£
48,941
53,933
102,874		 Total
funds
2019
£
48,941
53,933
102,874

5. Investment income

Rent receivable
Dividends receivable
Bank interest receivable
Rent receivable
Dividends receivable
Bank interest receivable		 General
funds
2020
£
8,470
29,840
499
38,809
General
funds
2019
£
8,447
37,616
766
46,829		 Total
funds
2020
£
8,470
29,840
499
38,809
Total
funds
2019
£
8,447
37,616
766
46,829

Page 21

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

6. Analysis of expenditure by activities

Provision of a residential care home
Provision of a residential care home		 Activities
undertaken
directly
2020
£
1,626,136
Activities
undertaken
directly
2019
£
1,521,675		 Support
costs
2020
£
2,502
Support
costs
2019
£
2,405		 Total
funds
2020
£
1,628,638
Total
funds
2019
£
1,524,080

All expenditure on activities undertaken directly and support costs were from operating funds in 2020 and 2019.

Page 22

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

6. Analysis of expenditure by activities (continued)

Analysis of direct costs

Staff costs
Depreciation
Staff agency charges
Staff training
Food
Cleaning and laundry
Surgery and medical supplies
Incidental patient supplies
Heating oil
Electricity
Water charges
Repairs and renewals
New building work
Garden maintenance
Telephone
Television
Motor and travelling
Insurance
General office expenses
Sundry expenses
Council tax
Advertising
Bad debts
Legal and professional fees
(Profit) / Loss on sale of fixed assets
Governance costs		 Provision of
a residential
care home
2020
£
1,277,958
49,136
18,308
2,992
61,089
21,714
45,526
398
13,012
21,356
5,948
42,646
10,873
3,987
1,419
(536)
3,272
17,253
13,594
7,885
1,364
1,456
154
3,566
(4,234)
6,000
1,626,136		 Total
funds
2020
£
1,277,958
49,136
18,308
2,992
61,089
21,714
45,526
398
13,012
21,356
5,948
42,646
10,873
3,987
1,419
(536)
3,272
17,253
13,594
7,885
1,364
1,456
154
3,566
(4,234)
6,000
1,626,136

Page 23

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

6. Analysis of expenditure by activities (continued)

Analysis of direct costs (continued)

Staff costs
Depreciation
Staff agency charges
Staff training
Food
Cleaning and laundry
Surgery and medical supplies
Incidental patient supplies
Heating oil
Electricity
Water charges
Repairs and renewals
New building work
Garden maintenance
Telephone
Television
Motor and travelling
Insurance
General office expenses
Sundry expenses
Council tax
Advertising
Bad debts
Legal and professional fees
(Profit) / Loss on sale of fixed assets
Governance costs		 Provision of
a residential
care home
2019
£
1,084,133
48,862
122,258
6,817
55,836
21,993
26,456
874
15,771
20,730
5,979
31,858
11,413
7,162
2,058
(297)
4,039
16,045
9,245
6,153
1,297
9,106
78
7,227
182
6,400
1,521,675		 Total
funds
2019
£
1,084,133
48,862
122,258
6,817
55,836
21,993
26,456
874
15,771
20,730
5,979
31,858
11,413
7,162
2,058
(297)
4,039
16,045
9,245
6,153
1,297
9,106
78
7,227
182
6,400
1,521,675

Page 24

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

6. Analysis of expenditure by activities (continued)

Analysis of support costs


Bank charges
Bank charges
Auditors' remuneration
Governance - Auditors remuneration		 Provision of
a residential
care home
2020
£
2,502
Provision of
a residential
care home
2019
£
2,405
Operating
funds
2020
£
6,000		 Total
funds
2020
£
2,502
Total
funds
2019
£
2,405
Operating
funds
2019
£
6,400

7. Auditors' remuneration

8. Staff costs

Staff costs were as follows:

Wages and salaries
Social security costs
Contribution to defined contribution pension schemes		 2020
£
1,145,443
111,949
20,566
1,277,958		 2019
£
990,235
77,926
15,972
1,084,133

Page 25

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

8. Staff costs (continued)

The average number of persons employed by the Charity during the year was as follows:

2020 2019
No. No.
Employees 58 53

The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was:

2020 2019
No. No.
In the band £60,001 - £70,000 - 1
In the band £70,001 - £80,000 1 -

9. Key management personnel

Wages and salaries
Social security costs
Pension costs		 2020
£
165,261
19,184
6,412
190,857		 2019
£
157,178
18,139
3,170
178,487

10. Trustee directors' remuneration and expenses

During the year, no Trustee directors received any remuneration or other benefits (2019 - £NIL).

During the year ended 31 December 2020, no Trustee director expenses have been incurred (2019 - £ NIL).

Page 26

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

11. Tangible fixed assets

Cost or valuation
At 1 January 2020
Additions
Disposals
At 31 December 2020
Depreciation
At 1 January 2020
Charge for the year
On disposals
At 31 December 2020
Net book value
At 31 December 2020
At 31 December 2019		 Freehold
property
£
1,486,736
5,345
-
1,492,081
46,672
14,579
-
61,251
1,430,830
1,440,064		 Motor
vehicles
£
32,180
42,835
(32,180)
42,835
29,931
4,309
(30,323)
3,917
38,918
2,249		 Fixtures and
fittings
£
287,053
24,817
(8,984)
302,886
178,318
30,454
(7,925)
200,847
102,039
108,735		 Total
£
1,805,969
72,997
(41,164)
1,837,802
254,921
49,342
(38,248)
266,015
1,571,787
1,551,048

All of the tangible fixed assets of the Charity are used directly for charitable purposes.

12. Fixed asset investments

Cost or valuation
At 1 January 2020
Revaluations
At 31 December 2020		 Listed
investments
£
871,704
(71,742)
799,962

Historical cost as at 1 January 2020 and 31 December 2020

807,000

Page 27

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

Valuation

The fair value of listed investments is determined by the reference to the market value.

Listed investments at market value

Charifund - Equities Investment Fund for Charities
Charibond - Charities Fixed Interest Common Investment Fund
Edentree - Amity Balanced Fund
Edentree - Amity Global Equity Fund		 2020
£
315,222
166,459
188,173
130,108
799,962		 2019
£
381,391
164,562
202,131
123,620
871,704

13. Investment property

Valuation
At 1 January 2019 and 31 December 2019
Surplus on revaluation
At 31 December 2020		 Freehold
investment
property
£
230,000
30,000
260,000

The 2020 valuations were made by the Trustee directors, on an open market value for existing use basis. The Trustee directors consider that the open market value equates to fair value.

Page 28

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

14. Stocks

Medical supplies and food
15.
Debtors
Trade debtors
Prepayments and accrued income		 2020
£
4,609
2020
£
110,090
41,863
151,953		 2019
£
2,109
2019
£
115,775
26,261
142,036

16. Creditors: Amounts falling due within one year

Trade creditors
Other taxation and social security
Other creditors
Accruals and deferred income		 2020
£
30,248
34,579
6,360
39,570
110,757		 2019
£
31,882
35,050
20,571
13,842
101,345

Income is deferred in respect of resident fees received in advance and income for fundraising events received in advance.

Deferred income at 1 January 2020
Resources deferred during the year
Amounts released from previous periods		 2020
£
1,247
3,221
(1,247)
3,221		 2019
£
2,670
1,247
(2,670)
1,247

Page 29

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

17. Financial instruments

Financial assets
Financial assets measured at fair value through income and expenditure
Financial assets measured at amortised cost
Financial liabilities
Financial liabilities measured at cost less impairment		 2020
£
1,059,962
363,148
1,423,110
2020
£
76,178		 2019
£
1,101,704
345,428
1,447,132
2019
£
66,295

Financial assets measured at fair value through income and expenditure comprise fixed asset listed investments and investment property.

Financial assets measured at amortised cost comprise trade debtors and cash and cash equivalents.

Financial liabilities measured at cost less impairment comprise trade creditors, accruals and other creditors.

Page 30

Petworth Cottage Nursing Home

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

18. Statement of funds

Statement of funds - current year

Balance at
Balance at 1 31
January Transfers Gains/ December
2020 Income Expenditure in/out (Losses) 2020
£ £ £ £ £ £
Unrestricted
funds
Operating fund
-		 1,512,277 (1,628,638) 116,361 - -
General funds
General fund
2,925,205		 172,818 (9,457) (116,361) (41,743) 2,930,462
Total of funds
2,925,205		 1,685,095 (1,638,095) - (41,743) 2,930,462
Statement of funds - prior year
Balance at
Balance at 31
1 January Transfers Gains/ December
2019 Income Expenditure in/out (Losses) 2019
£ £ £ £ £ £
General Funds
Operating fund
-		 1,397,639 (1,524,080) 126,441 - -
General fund
2,818,452		 149,703 (9,851) (126,441) 93,342 2,925,205
2,818,452 1,547,342 (1,533,931) - 93,342 2,925,205

Page 31

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

19. Reconciliation of net movement in funds to net cash flow from operating activities

Net income for the period (as per Statement of Financial Activities)
Adjustments for:
Depreciation charges
Dividends, interests and rents from investments
Loss/(profit) on the sale of fixed assets
Decrease/(increase) in stocks
Decrease/(increase) in debtors
Increase in creditors
Unrealised (gain)/loss on investments
Net cash provided by operating activities
20.
Analysis of cash and cash equivalents
Cash in hand
Total cash and cash equivalents
21.
Analysis of changes in net debt
At 1
January
2020
£
Cash at bank and in hand
229,653
229,653		 2020
£
5,257
49,342
(38,809)
(4,234)
(2,500)
(9,917)
9,412
41,742
50,293
2020
£
252,908
252,908
Cash flows
£
23,255
23,255		 2019
£
106,753
48,862
(46,829)
182
71
649
5,908
(93,342)
22,254
2019
£
229,653
229,653
At 31
December
2020
£
252,908
252,908

Page 32

Petworth Cottage Nursing Home (A company limited by guarantee)

Notes to the financial statements For the year ended 31 December 2020

22. Pension commitments

The Charity operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Charity in an independently administered fund. The pension cost charge represents contributions payable by the Charity to the fund and amounted to £20,566 (2019 - £15,972). Contributions totalling £824 (2019 - £1,499) were payable to the fund at the balance sheet date and are included in creditors.

23. Related party transactions

During the year the Charity incurred property management fees of £3,046 (2019 - £1,779) from Barrington and Co, of which T Barrington, trustee, is a director. At the balance sheet date the amount due to Barrington and Co was £nil (2019 - £nil).

There were no other related party transactions requiring disclosure in 2020.

24. Controlling party

The charitable company is controlled by its trustee directors.

Page 33