Annual Report and Financial Statement for the 1[st] January 2020-31[st] December 2020
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ADMINISTRATIVE INFORMATION
UK CHARITY NUMBER: 1061133
FINANCIAL PERIOD: 1 January 2020 - 31 December 2020
TRUSTEES: Rose Acock MBE Dr Emma Stone Richard Veal Derek Acock Barbara Acock REGISTERED ADDRESS: Apt 45, Llanthony Priory, St Ann Way Gloucester GL2 5GQ UK BANK: Lloyds, Tewkesbury Gloucestershire INDEPENDENT EXAMINER: Mr Paul Stafford APS Accounting 7 Grasmere Road Longlevens Gloucester GL2 0NQ
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TRUSTEES REPORT FOR THE YEAR ENDED 31 December 2020
DORS is governed by a constitution adopted on the 3 January 1997, and amended in 2004.
The objective of the Charity is to facilitate the development of rural communities in poor regions of Sichuan in an integrated manner that targets those most in need for long-term sustainable development.
DORS has a legally recognized representative office in Hanyuan County, Sichuan Province. UK support is provided by the Trustees who work on a voluntary basis. There are 8 staff in Sichuan, Vice Director, Finance Manager, 5 programme staff, and driver.
The charity supports village development projects in poor areas of rural Sichuan. DORS Representative Office in Sichuan presents its work plan and expected income from foreign sources to the Public Security Bureau for approval each January. Financial regulations include preparing annual accounts which are audited by a Chinese auditor. This was successfully completed for the period 1[st] January 202031[st] December 2020.
In addition to DORS Representative Office in Sichuan, DORS also has a small local registered Chinese NGO, which will be able to receive Chinese funding from Chinese foundations (the representative office cannot). This Chinese NGO is currently dormant.
There is no financial arrangement with the local government and project expenditure goes directly from DORS to the project villages.
PROJECT PROGRESS SUMMARY
Progress was hindered by the Covid restrictions which resulted in no community visits being allowed between February and May, in addition, we were required to suspend one of our projects from February to mid August 2020. This was followed by a period of heavy rain, flooding and poor travel conditions which resulted in further delays. Due to the covid outbreak, there are heightened security and reluctance by local officials to allow DORS visits to rural communities and visits between counties.
Livelihood for Yi Communities Project
This project improves livelihoods in 6 villages in Pianma Township Hanyuan County and two villages in Xide County. It was a three-year project November 2016 – October 2019, which was extended until March 2021. It is funded partly by Misereor donation is 605,000 Euro, and total project cost 810,000 Euros.
There were significant difficulties in implementing the project after the outbreak of Covid 19. Despite this, the project continued to make progress during the year. DORS was able to secure an extension, from October 2020 to March 21, which would give us the opportunity to catch up on the delayed activities.
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During the year we continued to develop the cooperatives and their capacities to produce and trade walnuts and huajiao in Pianma Township. Through the cooperatives and directly with villagers, the capacity to develop e-commerce has increased significantly. The villagers now have several different routes to market, they also have processing equipment in place which means they can sell produce at different time, maximizing the fluctuations in market price. And selling both fresh and dried products. The market for walnuts and huajiao have been adversely affected during the covid outbreak as there has been a down turn in the hospitality sector, which is the main purchaser of these products.
The youth enterprise grants have been successful with several businesses set up and flourishing, and these have created additional employment in the communities.
In Xide County, the two project villages, the income generating projects for women were continued and supported for 290 households, with training and grants. Literacy and financial skills training also contributed to the business successes. Women that have expanded their piglet breeding have benefited from the rise in pork prices, which is a result of widespread swine flu. Women continue to increase their household income and are more involved in community decision making.
The elderly people and those with special needs were assessed and some necessary items of blankets, food and clothing provided.
’ Xide Yi Women s Livelihoods and Well-being Project
A new project was started in March 2020 in Xide County of Liangshan Yi Minority Autonomous Prefecture. The total budget for the project is £543,266, which includes grant from Kadoorie Charitable Foundations of £448,370, and local and government contributions. The project aims to Improve the livelihoods and wellbeing of Yi people in 2 villages, particularly women. Specific Objectives:
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To increase and diversify household income to reduce poverty.
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To build the capacity of women to engage in livelihoods activities and community affairs.
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To improve health and sanitation situation particularly to benefit women and children.
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To develop and promote a model for Yi community development. Indicator: Model prepared and shared with over 20 organisations/departments.
Project start-up was delayed due to the covid 19 outbreak and related restrictions. During this time, there were also restrictions on travel to the project site, and we were unable to continue in one of the two villages. An alternative location was found and baseline study conducted later in the year.
Fuel efficient stoves Project
A new two-year project was started in May 2020 for £63,919 to build 420 fuel efficient stoves in rural households. Part of the costs and materials are provided by the household.
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Loan Scheme
The loan project remains suspended due to unclear regulations around NGO authorization to conduct loan schemes. The original donors no longer require follow up reports on the use of the funds. These funds can be designated for use as small business development grants when needed.
Education Projects
DORS is not currently supporting any students. Although there are some funds available for 2021.
FINANCE
DORS received donations and grant income of £98,333 (last year £201,643). The total incoming funds were £101,751 (last year £202,886). The main donors this year were Kadoorie Foundation and the private donor for the stoves project.
Of this year’s total income, £98,333 was restricted for specific projects and the remainder is unrestricted funds.
In total, the Charity expended £126,954 during the year (last year £152,300).
Of the total expenditure, project expenditure was £116,377 (last year £139,858). The admin costs were £1587 as most staff and office running costs are covered by project expenditure.
At the end of December 2020 DORS had total assets amounting to £313,979 of which £6,968 were fixed assets (vehicle £6,415 purchased in 2017). There is a balance of £307,111 carried forward and available for financing the two new projects, the temporarily suspended loan scheme, further projects and as a reserve. This is particularly high as we have a loan fund of £152,926 that we are not currently loaning as our legal status relating to loans is unlikely to be clarified in the near future, and the project progress has been slow due to Covid restrictions.
DORS has two Sterling bank accounts with Lloyds, and a Euro account for the Misereor project opened in Nov 2016.
We have one bank account in China in line with the new International NGO law. Some cash is kept in a higher interest short term bond with the same bank. All accounts and cash are balanced on a monthly basis.
Trustees – Payment to trustees. There were no payments to trustees during this period.
Reserves
DORS has revised its reserves policy to take into account employment law in China. The minimum reserve will cover the costs of closing down the programme and related staff redundancy costs, and the costs of international staff repatriation in case on an emergency. The required sum will be kept under review by the Director to account for varying circumstances. At the present time, it is set at £51,136. The actual unrestricted funds available are sufficient to cover this.
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Rose Acock On behalf of Trustees 6 October 2021
Development Organisation Of Rural Sichuan Statement of Financial Activities for the Period 1st January 2020 to 31st December 2020 Exchange rate 1 GBP = 8.8 RMB 1 GBP = 1.15 Euro Income and Expenditure
| Restricted | Unrestricted | Total Funds | 2019 | |||||
|---|---|---|---|---|---|---|---|---|
| GBP | CNY | GBP | CNY | GBP | CNY | GBP | ||
| 1 | Incoming resources | |||||||
| 1.1 | Charitable donations | 98,333 | 863,368 | 690 | 6,072 | 99,023 | 869,440 | 201,643 |
| 1.2 | Other Income | 0 | 0 | 2,728 | 24,005 | 2,728 | 24,005 | 1,243 |
| Bank Interest CN | 0 | 0 | 2,232 | 19,640 | 2,232 | 19,640 | ||
| Bank Interest EN | 0 | 0 | 24 | 208 | 24 | 208 | ||
| Loan management fee | 0 | 0 | 0 | 0 | 0 | 0 | ||
| Exchange rate gain | 0 | 0 | 0 | 0 | 0 | 0 | ||
| DORS admin income | 0 | 0 | 6 | 57 | 6 | 57 | ||
| Assets 3 | 0 | 0 | 466 | 4,100 | 466 | 4,100 | ||
| Total Income | 98,333 | 863,368 | 3,418 | 30,077 | 101,751 | 893,445 | 202,886 | |
| 2 | Resources expended | |||||||
| 2.1 | Charitable Expenditure 4 | 116,377 | 1,024,119 | 0 | - | 116,377 | 1,024,119 | 139,858 |
| 2.2 | Admin Expenditure: 5 | 0 | 0 | 1,587 | 13,964 | 1,587 | 13,964 | 3,301 |
| Audit fee (UK) | 0 | 0 | 0 | 0 | 0 | 0 | ||
| Audit fee (China) | 0 | 0 | 631 | 5,554 | 631 | 5,554 | ||
| DORS project admin China | 0 | 0 | 956 | 8,410 | 956 | 8,410 | ||
| of which fundraising | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2.3 | Other Expenditure | 0 | 0 | 8,990 | 79,494 | 8,990 | 79,494 | 9,141 |
| Loan management | 405 | 3,567 | 405 | 3,567 | ||||
| Asset depreciation | 0 | 0 | 7,229 | 63,615 | 7,229 | 63,615 | ||
| Exchange rate loss 6 | 0 | 0 | 1,196 | 10,525 | 1,196 | 10,525 | ||
| Bank fees CN | 0 | 0 | 95 | 835 | 95 | 835 | ||
| Bank fees EN | 0 | 0 | 65 | 952 | 65 | 952 | ||
| Total Expenditure | 116,377 | 1,024,119 | 10,577 | 93,458 | 126,954 | 1,117,577 | 152,300 | |
| 3 | Gross transfer between funds 7 | 15,187 | 133,646 | -15,187 | -133646 | |||
| Net Incoming Resources | -2,857 | -27,105 | -22,346 | -197,027 | -25,203 | -224,132 | 50,586 | |
| Total Funds Brought Forward (at ex rate of | ||||||||
| 8.8) | 219,079 | 1,927,895 | 120,103 | 1,056,906 | 339,182 | 2,984,801 | ||
| Total Funds Carried Forward (at ex rate of | ||||||||
| 8.8) | 216,222 | 1,900,790 | 97,757 | 859,879 | 313,979 | 2,760,669 |
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Development Organisation Of Rural Sichuan
| Balance Sheet as at 31 December 2020 | |||
|---|---|---|---|
| Exchange rate 1 GBP: 8.8 RMB | Total GBP | ||
| Fixed Assets | 6,968 | ||
| Restricted Vehicle | 5,749 | ||
| Unrestricted Furniture and equipment | 1,219 | ||
| Current Assets 7 | |||
| Account balances | GBP | CNY | 305,699 |
| Hanyuan CNY Account 1811 | 122,848 | 1081065 | |
| Hanyuan CNY Acc 1811 6 month bond | 115,405 | 1015560 | |
| UK Account 9580 | 1,286 | ||
| UK Account 4774 | 66,158 | ||
| UK Euro account (ex 0.854 31 Dec 2019) | 2 | 20 | |
| Cash balances | 457 | ||
| Cash CNY | 457 | 4017.24 | |
| Debtors(amount falling due within the year) | 7,421 | ||
| Loan funds outstanding loans | 710 | 6,250 | |
| Staff loans and deposit | 463 | 4074 | |
| Staff costs owed for Project 003 Misereor | 5,168 | 45477 | |
| Advance payment of rent | 1,080 | 9500 | |
| Net Current Assets | 313,576 | ||
| Creditors(amounts falling due within the | |||
| year) | -6,566 | ||
| Payments due | -6,566 | -57782.5 | |
| Total assets less liabilities | 313,979 | ||
| Net Assets | 313,979 | ||
| Net Assets Represented by: | |||
| GBP | CNY | ||
| 1. Restricted Funds: | 216,222 | ||
| Xide Yi Women Well-being (Kadoorie) | 34,334 | 300,181 | |
| Stoves Project (Hong Kong donor) | 26,718 | 235,118 | |
| Education Project | 2,244 | 19,744 | |
| Loan scheme capital (MC and PAA) | 152,926 | 1,345,750 | |
| 2.Unrestricted Income Funds | 97,757 | ||
| Unrestricted funds | 37,117 | 326,630 | |
| Reserve funds | 51,136 | 449,997 | |
| Designated funds: | |||
| Loan scheme management | 9,504 | 83,636 |
313,979
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http://www.oanda.com/currency/historical-rates
Development Organisation of Rural Sichuan
Notes to the Accounts for the Period 1 January 2020 to 31 December 2020 1. General
These accounts have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated. The accounts have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) issued on 16 July 2014
As a condition of the Registration of a Representative Office in China, DORS Representative office in Sichuan has annual audits in China of all Chinese related transactions. Therefore, the UK accounts were prepared using the information in the audited accounts for the same period, with the addition of UK income and expenditure.
At the balance sheet date the exchange rates are as follows:
1 Pound Sterling (GBP) = 8.8 Renminbi (RMB) / Chinese Yuan (CYN) 1 Pound Sterling (GBP) = 1.15 Euro
2. Income
Restricted Donations
| Xide Yi Women’s Livelihood and Well-being Project | £65,773 |
|---|---|
| (Kadoorie Charitable Foundations) | |
| Stoves Project | £31,960 |
| (Private donor Hong Kong) | |
| Education | £600 |
| (Private donors) | |
| ricted Donations | |
| Several donations were received from private donors | £690 |
Unrestricted Donations
Most of the donations received by the charity are for use on specific projects. Each project has a restricted fund. The fund title refers to the project name and major donor. Some of the project’s income comes from local contributions, so the amounts do not always exactly match that which is donated by the donor.
Villager contributions are included in project accounts along with the donor donations.
3. Assets
One laptop computer was purchased. No other assets were purchased in 2020.
4. Charitable Expenditure
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Restricted
Xide Yi Women’s Livelihood and Well-being Project (Kadoorie) £31,438 CNY276,660 Earthquake Fund £807 CNY7,098 Quaker Education Project £28 CNY243 Private Donor Stoves Project £5,242 CNY46,128 Integrated Rural Development and Livelihoods Project (Misereor) £78,862 CNY693,990
Unrestricted
Loans Scheme management costs
£405 CNY3,567
5. Admin expenditure:
The project office running costs are mostly covered as part of the charitable expenditure above. The Sichuan Representative Office is audited by a Chinese Auditor in China in compliance with the INGO law. UK Independent Examination fee was not paid during this 12-month period and will appear in 2021 accounts.
6. Exchange rate loss
These losses are due to fluctuations in the exchange rate over the year, especially related to the transfer from Kadoorie Charitable Foundations.
7. Gross transfer between funds
There was a transfer of £15,187 from unrestricted to restricted to account for the over expenditure in Misereor funded project.
8. Current Assets & Liabilities
Creditors – DORS is holding £6,566 (CNY57,782) in staff salary as performance pay that is not yet due, these funds were reported as spent in project accounts.
Assets –
Loan funds outstanding £710 (CNY6,250) Staff loans and deposit for apartment £463 (CNY4,047)
Misereor funded Integrated Rural Development and Livelihood Project £5,168 (CNY 45,476) this is for staff salaries to cover the period when Misereor projects were suspended during 2020. Most has been repaid, but this part will be repaid to DORS during the next accounting year.
Advance payment of rent £1,080 (CNY4,070) for months not covered in this financial year.
Loan Scheme Funds:
DORS runs a loan project where business loans are made to beneficiaries in project villages to develop their businesses. This loan fund consists of CNY100,000 from Sichuan Poverty Alleviation Association (PAA) and CNY1,252,000 from Mercy Corps both received in previous years. No loans were made in 2020 due to the unclear policy environment as to the legality of DORS making loans.
The loan fund total £152,926 CNY 1,345,749
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| GBP | CNY | |
|---|---|---|
| During the year loans made were | 0 | 0 |
| Loan capital repayments were | 0 | 0 |
| Balance of loan fund: | £152,926 | 1,345,750 |
| Balance of management fees (unrestricted) | £9,504 | £83,636 |
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Report to the trustees of DORS
I report on the accounts of DORS for the year ended 31 December 2020.
Respective responsibilities of trustees and examiner
As the charity's trustees, you are responsible for the preparation of the accounts in accordance with the requirements of the Charities Act 2011 (“the Act”).
I report in respect of my examination of the Trust’s accounts carried out under section 145 of the 2011 Act and in carrying out my examination, I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the Act.
An independent examination does not involve gathering all the evidence that would be required in an audit and consequently does not cover all the matters that an auditor considers in giving their opinion on the accounts. The planning and conduct of an audit goes beyond the limited assurance that an independent examination can provide. Consequently I express no opinion as to whether the accounts present a ‘true and fair’ view and my report is limited to those specific matters set out in the independent examiner’s statement.
Independent Examiner’s statement
I have completed my examination. I confirm that no material matters have come to my attention in connection with the examination which gives me cause to believe that in, any material respect:
• the accounting records were not kept in accordance with section 130 of the Charities Act; or
• the accounts did not accord with the accounting records; or
• the accounts did not comply with the applicable requirements concerning the form and content of accounts set out in the Charities (Accounts and Reports) Regulations 2008 other than any requirement that the accounts give a ‘true and fair’ view which is not a matter considered as part of an
independent examination. I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached
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Name: Paul Stafford FCCA Address: 7 Grasmere Road. Longlevens. GIOuster Date25 October 2021 13