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2023-12-31-accounts

REGISTERED CHARITY NUMBER: 1064522

REPORT OF THE TRUSTEES AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

THE ARMY DEPENDANTS' TRUST

Hysons Audit Services Ltd, Statutory Auditor 14 London Street

Andover Hampshire SP10 2PA

THE ARMY DEPENDANTS' TRUST

CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

Page
Report of the Trustees 1 to 8
Report of the Independent Auditors 9 to 12
Statement of Financial Activities 13
Balance Sheet 14
Cash Flow Statement 15
Notes to the Cash Flow Statement 16
Notes to the Financial Statements 17 to 26
Detailed Statement of Financial Activities 27 to 28

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

The trustees present their report with the financial statements of the charity for the year ended 31 December 2023. The trustees have adopted the provisions of Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

OBJECTIVES AND ACTIVITIES

Objectives and aims

The main object of the Charity is the promotion of the efficiency of the Army through the relief of persons who are in a condition of immediate financial need, hardship or distress and who are the dependants or next of kin of a deceased soldier or officer. In so far as the trustees cannot apply the income for this main object, they apply it in making grants to ABF The Soldiers' Charity (registered Charity number 211645) for its general purposes.

Significant activities

Since 2013, the Charity has met its objects through 2 mechanisms: The making of grants to beneficiaries of members; and, the making of a major grant to the ABF (2023: £765,240), to fulfill all other objects of the Charity, on the Charity's behalf. Trustees review this approach on an annual basis and continue the practice of granting to ABF in the Spring following the end of an accounting year. This practice allows Trustees to determine the appropriate value of the grant that can be made and to fully consider other options for the disbursement of funds.

Public benefit

In considering the activities that have been undertaken in the past year, the trustees have paid due regard to the guidance on public benefit published by the Charity Commission. Trustees continue to look at whether there are other groups of potential beneficiaries that could be reached by extending eligibility criteria in line with the Charity's objectives. It is the opinion of the trustees that the Charity satisfies the criteria for public benefit.

Grantmaking

The object of the charity is the promotion of the efficiency of the Army through the relief of dependants of deceased soldiers or officers in the following order of priority: The dependants of deceased members of the charity; the dependants of deceased soldiers or officers.

The trust may assist dependants through the provision of immediate grants or, for the relief of dependants in financial hardship, sickness or disability, the trust may provide grants, loans, gifts, pensions or otherwise.

If and in so far as the trust's income is not required to meet the above objects, trustees may apply it to: Make grants to the ABF for its general purposes; or for the benefit of persons who are serving or have served in the British Army, or their dependants, in any charitable ways.

Page 1

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

ACHIEVEMENT AND PERFORMANCE

Charitable activities

The Charity's key effort throughout the year continued to be grant making to the dependants of soldiers, officers and some retired members, who died during the year. Since its primary activity is dependent upon deaths, which are of course unforeseen, the objective is not to maximise grant making but instead to react evenhandedly, efficiently and effectively to dependants' needs when a death does occur. The trustees consider that they have achieved this objective as best as practically possible.

Whether in times of peace or conflict, the precise future demand on the Trust's resources is something largely beyond the trustees' control. Liquidity planning is based on the expected level of discretionary grants which is, in turn, based on a statistical average number of fatalities. However, in times of conflict or a mass casualty event, the number of deaths will often be beyond the statistical average and planning is thus made more difficult than normal. For this reason trustees maintain significant liquidity, to the approximate value of 3 times the typical annual average expenditure of individual grants. This enables the Trust to respond rapidly if required in an emergency situation.

During the year the trust was notified of 54 deaths (2022: 60). The trust awarded 50 (2022: 55) grants to dependants of 48 (2022: 55) personnel. In 6 cases no award was made (2022: 5). 42 awards were made to regular or full time reservist soldiers, officers and retired members in 2023. 6 awards were made to members of the Army Reserve in 2023, none on the Regular Reserve liability basis. None of these awards were made to non-members. The 5 year average number of deaths where a benefit was paid is 56 (2022: 58).

Grants were made, according to needs, to the beneficiary nominated by the deceased, usually being the spouse or a parent, or sometimes to other family dependants where the trustees considered there was need. Grants made to individuals during the year totalled £963,038 compared to £1,100,000 in 2022.

Individual Grantmaking

As far as is possible the trustees aim to make any grant within 4 working days of the date of a death being made known to them. Where a beneficiary requests payment by cheque, the trustees aim to post such correspondence within 4 working days of the date of death. In practice, individual grants are usually received by beneficiaries well within these time frames, sometimes in a matter of hours. The Secretary will make suitable enquiries into the circumstances and follows a system of practice and precedent to make grants on behalf of trustees. In exceptional circumstances the Secretary seeks advice from trustees before making a grant.

Cooperation with ABF The Soldiers' Charity

In 2023, Trustees continued to rely heavily upon ABF, The Soldiers Charity, in dispersing the funds of the Trust in accordance with its objects and aims. Whilst recognising the coherence this provides to the sector, Trustees equally remain vigilant to the governance and risk management implications of such a methodology for grant making. With this in mind trustees annually review this approach to working with The Soldiers Charity, to ensure the objects of the trust are both best met and properly overseen.

Page 2

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

ACHIEVEMENT AND PERFORMANCE

Fundraising activities

The Charity's principal fund raising objective is to raise sufficient funds to meet the average grant need, based on normal expectations of members' mortality rates, and this is achieved through a combination of subscriptions from members and investment income. Subscriptions are paid at a rate of £8.75 per year - this has remained the same for the past 15 years. Where possible, subscriptions are collected through payroll giving to enable tax efficiency for members, but cheque payments and bank transfers are also accepted. Eligible retired officers continue to pay their subscription of £10 per year through standing orders.

The trustees encourage all Regular and Reserve soldiers and officers to become members of the scheme. Judged by any practical measure, the membership of eligible Regular personnel continues to be as high as achievable. The only gaps in this occur when individuals may re-join the Regular component, or transfer into it from the Reserve. This is a negligible figure but the trust is pursuing methods to eliminate these gaps nonetheless. In the event of a death, care is taken to ensure that where there has been an administrative error, this does not disadvantage the dependants of eligible personnel. Take-up of membership amongst Reservists remains more challenging. In 2023, Reservist membership was approximately 55% (2022: 55%). Of reservist members, approximately 30% experienced membership payment difficulties (2022 30%). In 2021, Trustees approved the acquisition of new MIS that will much better enable membership payments for reserve personnel and reduce the impact on members and units accordingly. However, the integration of the new system with Defence security protocols is still ongoing and the new MIS had not achieved operating capability by the end of 2022. Work still continued into 2023 to achieve this.

Trustees agreed in December 2017 to extend eligibility, at no cost, to all ex-Regulars with a Regular Reserve (RR) liability for the period of their RR liability; thus increasing potential beneficiaries by approximately 25,000. The practicalities of effecting this change were addressed in 2019, as the first beneficiaries under this category were supported. Trustees continue to monitor the broader implications for awareness, potential liabilities and the parity of offer to all eligible personnel across the scope of the charity.

As in previous years, the Trust did not experience significant impact as a result of Covid 19.

FINANCIAL REVIEW

Incoming resources

Subscription income from members totalled £869,637 (2022: £899,357), investment income was £1,164,254 (2022: £1,053,497) and £14,902 (2022: £2,081) was received in donations. The reduction in member subscriptions is within tolerance for fluctuating membership numbers, especially in terms of regular or full time reserve personnel. The fluctuation in investment income is within tolerance for the market conditions prevailing in 2023.

Resources expended

Grants awarded totalled £963,038 (2022: £1,100,000). The cost of fundraising was £40,150 (2022: £28,176), the cost of making grants and carrying on other charitable activities, but excepting the grants themselves, was £49,566 (2022: £40,230), and governance costs totalled £22,723 (2022: £19,118).

The method of allocating costs is explained in note 1 of the financial statements. Excluding grants, the total costs of the Charity were £112,439 (2022: £87,524). The ratio of annual running costs as a proportion of total income for 2023 was 5.47% (2022: 4.47%).

Page 3

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

FINANCIAL REVIEW

Investment policy and objectives

The majority of the Charity's funds are invested in the Armed Forces Charities Growth & Income Fund (AFCGIF) (formerly the Armed Forces Common Investment Fund). This fund is shared with other Armed Forces charities and is currently managed by BlackRock Investment Management (UK) Limited. The investment is unitised and may be held in Income Units in which the income is distributed or in Accumulation Units where the gross income is automatically reinvested. The lead Investment Manager is BlackRock Investment Management (UK) Limited who are appointed by the Advisory Board of AFCGIF, which comprises senior City individuals and representatives of the major investing charities.

The investment in AFCGIF is currently held in income units as this best meets the objective of generating income to cover grants and costs and, at the same time, allow the opportunity for capital growth. The asset allocation of AFCGIF is against a composite benchmark and, as at 31 December 2023, was made up of UK Equities, Global Equities, Fixed Income Bonds, Property, Alternatives, and Cash. The primary performance objective of AFCGIF is to seek to outperform the composite benchmark set by the Advisory Board by 1% per annum. The income paid during 2023 amounted to 8.50 pence per unit (2022: 8.15p). During the year under review the actual yield of the investment, based on the market value of the investment at the year end, was 3.93% (2022: 3.78%). The investment in AFCGIF increased in value by 0.29% (2022: 13.95% decrease) giving rise to an unrealised gain of £56,373 (2022: £3,112,019 loss). In addition, income of £756,500 was paid in 2023 (2022: £725,300).

In addition to this primary investment, and on the basis of advice taken by the Trustees, the Charity has other investments consisting of the Mayfair Property Income Trust for Charities and The M&G Equities Investment Fund for Charities (M&G Charifund).

The Property Income Trust for Charities (PITCH) is managed by Mayfair Capital Investment Management Limited and the fund administrator is Saltgate (UK) Limited. In October 2016 the Mayfair Capital was acquired by Swiss Life Asset Managers; however, day to day management of the PITCH has remained with the current team. This investment was made to diversify the portfolio and increase the yield whilst maintaining the potential for some capital growth in real terms. The PITCH objective is to invest in commercial property throughout the UK. It aims to deliver an income yield of around 6% p.a., whilst at least growing the capital value in real terms. Income is now distributed, gross, monthly. The Fund operates both ethical and environmental policies and seeks to be a socially responsible investor. The value of the Charity's holding in this fund decreased by 6.38% during the year giving rise to an unrealised loss of £27,716 (2022: £88,307). Income of £25,724 was received which is equivalent to an annual 12 month rolling yield of 6.32% (2022: 5.38%).

Page 4

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

FINANCIAL REVIEW

The M&G Charifund is designed to provide a high and growing income, while at the same time protecting its capital from the erosive effects of inflation. The Charifund portfolio comprises approximately 100 stocks. The fund invests in a well-diversified portfolio of mainly high yielding UK stocks with the objective of generating a high income and increasing the annual distribution. The aim is to provide a level of income that is significantly higher than that of the FTSE All-Share Index. Over the year the value of this holding has decreased by 2.35% (2022: 5.57%) giving rise to unrealised loss of £123,252 (2022: £309,397). In addition, income of £305,185 (2022: £296,261) was received which is equivalent to a yield at 31 December 2023 of 5.96% (2022: 5.65%).

3 year % performance comparison of the equity investments


2021
2022
2023		 Combined Combined Combined
Fund Growth Yield Growth Yield Growth Yield Total
growth		 Average
yield
AFCGIF 9.62% 3.15%
-13.95%		 3.78% 0.29% 3.93% -1.35% 3.62%
PITCH 17.40% 4.93%
-16.89%		 5.38% -6.38% 6.32% -1.96% 5.54%
M&G 13.40% 5.39%
-5.57%		 5.65% -2.35% 5.96% 1.83% 5.67%

As well as these investments, and in order to maintain a necessary amount of cash reserves to meet unpredictable demands, the Trust has funds on deposit with clearing banks and with the COIF Charities Deposit Fund administered by CCLA Investment Management Limited.

Reserves policy

The policy of the Charity continues to be to generate sufficient funds through subscriptions and investment income to meet its primary object - the granting of awards to dependants or next of kin of deceased soldiers or officers. This is the core object of the Charity and is the primary requirement for operational reserves. It is impossible to predict with accuracy the number of fatalities that will occur in the year ahead, but use of historical data was agreed as the most appropriate guide. Following a study of historical data, it was agreed that the most appropriate figure for future planning was the 20 year average fatality data. Using this figure for annual fatalities, and assuming a 3.5% return on investments as previously, would give rise to an Operational Reserve requirement of approximately £15m.

In addition, trustees have felt the Trust should hold reserves available to meet both the commitment against a single major accident, such as a plane crash or ship sinking, and also against casualties from a short-term, major conflict. Trustees agreed that a separate reserve fund - a Mass Casualty Reserve - of £5m should be established for this.

To meet its normal operational need and have cover for the unexpected events above, the trustees deem that an appropriate level of reserves to cover both requirements is £20m. Noting that current investments continue to exceed this, Trustees have decided to pursue a total returns approach from 2022 onwards, treating the investment as a virtual endowment.

Page 5

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

FUTURE PLANS

Trustees intend to conduct an investment review, considered in conjunction with the revision of the reserves policy. Trustees will develop a revised investment policy aligned to both risk management and investment thinking, as well as making clear the Trust's responsible investment position. Trustees also intend that further work is conducted with ABF, The Soldier's Charity, and others, to ensure that ADT grant making is achieving the objects of the Trust's revised scheme. This will include working with HQ Army to identify potential areas of need currently unfunded by Defence and not met by ADT. As ever, this work is driven by the core object of the Trust: The promotion of the efficiency of the Army through the relief of persons who are in a condition of immediate financial need, hardship or distress and who are the dependants or next of kin of a deceased soldier or officer.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Governing document

The Charity is governed by a Charity Commission Scheme dated 19th February 2009 and this replaced the previous scheme dated 1st September 1999. The new scheme comprises the present constitution of the Charity.

Management

Of our five trustees, four are appointed because of their particular knowledge of personnel and welfare issues in the Army; in addition, the trustees have appointed one co-opted trustee. The co-opted trustee, who serves for a term normally not exceeding five years, is chosen for their expertise in specialised areas pertinent to the Charity's operations, or as a representative of member groups eg Army Reservists. The trustees meet at least once, but usually twice, each year in order to manage and monitor the Charity's affairs. The trustees delegate the day to day responsibility for operating the Charity to the Secretary/Treasurer, who is assisted by a part time member of staff. However, trustees are on hand at all times to sanction important decisions particularly concerning the assessment of needs of beneficiaries of discretionary grants.

The trustees are chosen so as to bring to the executive function persons whose roles in the British Army are most relevant and appropriate to the aims and objectives of the Charity. Primarily these involve matters of welfare and family support, but the individuals chosen have a wide range of experience as well as multiple skills and very significant academic, military and other qualifications making them most suited to the position.

The trustees are conscious of their significant responsibilities and undertake training where appropriate, including attendance on at least one training day every two years. They have also appointed a legal adviser with specific expertise in charities to assist them in meeting their responsibilities. The trustees believe that these procedures ensure that they are properly equipped to fulfil their role efficiently and effectively.

Risk management

The trustees have examined the major governance, business, financial and operational risks that the Charity faces. Due to the nature of the Charity and modus operandi of the Charity the risks are fairly consistent, and are listed on a Risk Register which identifies impact, likely-hood of occurrence, and any mitigating action taken. This is monitored regularly by the CE and at least once a year formally by the trustees who ensure that control actions and procedures are in place wherever possible to minimise these risks.

REFERENCE AND ADMINISTRATIVE DETAILS

Registered Charity number

1064522

Page 6

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

Principal address

PO Box 5545 Westbury Wiltshire BA13 9BZ

Trustees

Mr B Alvin Brigadier C M B Coles Major General P Griffiths - Resigned 30.10.23 Major General S Humphris MBE - Appointed 24.11.23 Colonel M P Sykes

Co-opted trustees

Colonel N R W Astbury

CE/Secretary and treasurer

Mr D G Middleton

Auditors

Hysons Audit Services Ltd, Statutory Auditor 14 London Street Andover Hampshire SP10 2PA

Bankers

Lloyds Bank plc 7 Pall Mall London SW1Y 5NA

Solicitors

Wilsons Solicitors LLP Steynings House Summerlock Approach Salisbury Wiltshire SP2 7RJ

Investment managers

BlackRock Investment Management (UK) Limited CCLA Investment Management Limited 12 Throgmorton Avenue Senator House London, EC2N 2DL 85 Queen Victoria Street London, EC4V 4ET M&G Securities Limited Mayfair Capital Investment Management Ltd Laurence Pountney Hill 2 Cavendish Square London, EC4R 0HH London, W1G 0PU

Page 7

THE ARMY DEPENDANTS' TRUST

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2023

STATEMENT OF TRUSTEES' RESPONSIBILITIES

The trustees are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

The law applicable to charities in England and Wales, the Charities Act 2011, Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust deed requires the 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 the income and expenditure, of the charity for that period. In preparing those financial statements, the trustees are required to

The trustees are responsible for keeping proper accounting records which 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 the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Approved by order of the board of trustees on ............................................. and signed on its behalf by:

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

Major General S Humphris MBE - Trustee

Page 8

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE ARMY DEPENDANTS' TRUST

Opinion

We have audited the financial statements of The Army Dependants' Trust (the 'charity') for the year ended 31 December 2023 which comprise the Statement of Financial Activities, the Balance Sheet, the Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (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 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 trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Report of the Independent Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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

Page 9

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE ARMY DEPENDANTS' TRUST

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 Statement of Trustees' Responsibilities, the trustees are responsible for the preparation of the financial statements which 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 liquidate the charity or to cease operations, or have no realistic alternative but to do so.

Page 10

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE ARMY DEPENDANTS' TRUST

Our responsibilities for the audit of the financial statements

We have been appointed as auditors 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 a Report of the Independent Auditors 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

We assessed the susceptibility of the charity’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

To address the risk of fraud through management bias and override of controls, we:

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

Page 11

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE ARMY DEPENDANTS' TRUST

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors.

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.

Hysons Audit Services Ltd, Statutory Auditor 14 London Street Andover Hampshire SP10 2PA

Date: .............................................

Page 12

THE ARMY DEPENDANTS' TRUST

STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2023

Notes
INCOME AND ENDOWMENTS FROM
Donations and legacies
3
Investment income
4
Other income
Total
EXPENDITURE ON
Raising funds
5
Charitable activities
6
Grants to dependants and ABF The
Soldiers' Charity
Total
Net gains/(losses) on investments
NET INCOME/(EXPENDITURE)
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD		 2023
2022
Unrestricted
Total
fund
funds
£
£
884,539
901,438
1,164,254
1,053,497
5,000
5,000
2,053,793
1,959,935
40,150
28,176
1,800,567
1,990,348
1,840,717
2,018,524
(94,595)
(3,509,723)
118,481
(3,568,312)
27,695,109
31,263,421
27,813,590
27,695,109

The notes form part of these financial statements

Page 13

THE ARMY DEPENDANTS' TRUST

BALANCE SHEET 31 DECEMBER 2023

Notes
FIXED ASSETS
Intangible assets
14
Tangible assets
15
Investments
16
CURRENT ASSETS
Debtors
17
Cash at bank
18
CREDITORS
Amounts falling due within one year
19
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT
LIABILITIES
NET ASSETS
FUNDS
20
Unrestricted funds
TOTAL FUNDS		 2023
2022
Unrestricted
Total
fund
funds
£
£
18,533
-
620
108
24,785,634
24,880,230
24,804,787
24,880,338
1,961
2,076
3,030,671
2,839,143
3,032,632
2,841,219
(23,829)
(26,448)
3,008,803
2,814,771
27,813,590
27,695,109
27,813,590
27,695,109
27,813,590
27,695,109
27,813,590
27,695,109

The financial statements were approved by the Board of Trustees and authorised for issue on ............................................. and were signed on its behalf by:

............................................. Major General S Humphris MBE - Trustee

............................................. Brigadier C M B Coles - Trustee

The notes form part of these financial statements

Page 14

THE ARMY DEPENDANTS' TRUST

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2023

Notes
Cash flows from operating activities
Cash generated from operations
1
Net cash used in operating activities
Cash flows from investing activities
Purchase of intangible fixed assets
Purchase of tangible fixed assets
Interest received
Dividends received
Property investment income
Net cash provided by 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		 2023
£
(948,639)
(948,639)
(23,166)
(921)
76,845
1,061,685
25,724
1,140,167
191,528
2,839,143
3,030,671		 2022
£
(387,637)
(387,637)
-
-
8,517
1,021,611
23,369
1,053,497
665,860
2,173,283
2,839,143

The notes form part of these financial statements

Page 15

THE ARMY DEPENDANTS' TRUST

NOTES TO THE CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2023

1. 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)
Adjustments for:
Depreciation charges
Losses on investments
Loss on disposal of fixed assets
Interest received
Dividends received
Property investment income
Decrease in debtors
(Decrease)/increase in creditors
Net cash used in operations		 2023
£
118,481
4,934
94,595
108
(76,845)
(1,061,685)
(25,724)
115
(2,618)
(948,639)		 2022
£
(3,568,312)
22
3,509,723
-
(8,517)
(1,021,611)
(23,369)
703,082
21,345
(387,637)

2. ANALYSIS OF CHANGES IN NET FUNDS

Net cash
Cash at bank
Total		 At 1.1.23
£
2,839,143
2,839,143
2,839,143		 Cash flow
£
191,528
191,528
191,528		 At 31.12.23
£
3,030,671
3,030,671
3,030,671

The notes form part of these financial statements

Page 16

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

1. STATUTORY INFORMATION

The Army Dependants' Trust is an unincorporated charity registered with the Charity Commission for England and Wales (no.1064522). The principal address is PO Box 5545, Westbury, Wiltshire, BA13 9BZ.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements of the charity, which is a public benefit entity under FRS 102, 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)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Charities Act 2011. The financial statements have been prepared under the historical cost convention, with the exception of investments which are included at market value, as modified by the revaluation of certain assets.

Income

All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.

Expenditure

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources.

Grants payable are payments made to third parties in the furtherance of the charitable objectives of the Trust. The grants are accounted for where the trustees have agreed to pay the grant without condition and the recipient has a reasonable expectation that they will receive a grant.

Raising funds

The cost of raising funds are set out in note 5 and consist of those costs relating to collecting subscriptions. The charities investments are comprised primarily in the Armed Forces Charities Growth & Income Fund (AFCGIF), a charity in its own right managed by BlackRock Investment Managers (UK) Limited and in the M&G Charifund. The costs for these Funds are taken from the Fund itself and are reflected in the price of the Fund's units. These costs constitute approximately 0.48% (AFCGIF) and 0.47% (M&G Charifund) of the average value of the Fund over the year.

Charitable activities

Costs of charitable activities include grants made and an apportionment of other costs as shown in notes 7 to 10 and on the basis of the apportionment referred to above.

Page 17

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

2. ACCOUNTING POLICIES - continued

Governance costs

Governance costs are set out in note 9 and comprise all costs involving the public accountability of the Charity and its compliance with regulation and good practice. These costs include costs related to statutory audit and legal fees together with an apportionment of other costs as referred to above.

Taxation

The charity is exempt from tax on its charitable activities.

Pension costs and other post-retirement benefits

The charity operates a defined contribution pension scheme. Contributions payable to the charity's pension scheme are charged to the Statement of Financial Activities in the period to which they relate.

Allocation and apportionment of costs

Costs are allocated specifically to the activity to which they relate wherever possible. Some costs, mostly staff costs but including some administrative, establishment and finance costs relate to all three main activities of the Charity and these costs have been allocated as to 35 per cent to the cost of generating funds, 50 per cent to charitable activities and 15 per cent to governance. Other costs relate to generating funds and charitable activities only and these costs are split 41 per cent and 59 per cent respectively.

The cost allocation has always been determined by considering the time spent on each activity by the Charity's staff and calculating the resulting percentage of total staff costs that is attributable to each of those activities. This is reviewed annually and was last changed with effect from 1 January 2010 following changes in the method of collecting subscriptions which led to a significant reduction in the time spent on generating funds.

Tangible fixed assets

All assets costing more than £250 are capitalised and all assets are valued at cost less depreciation. Depreciation is charged on office equipment which is written off on a reducing balance basis at the rate of 33 per cent per annum which reflects their estimated useful life.

Fixed asset investments

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

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 either the market value at the start of the year or the purchase date if purchased during the year. Unrealised gains and losses are calculated as the difference between the market value at the year end and either the market value at the start of the year or the purchase date if purchased during the year.

Fund accounting

Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees.

Page 18

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

3.
DONATIONS AND LEGACIES
Members' subscriptions
Donations
4.
INVESTMENT INCOME
Property based investment income
Dividend income
Interest on cash deposits
5.
RAISING FUNDS
Raising donations and legacies
Staff costs
General insurance
Printing, postage, stationery, telephone and internet
Sundries
Travelling
Books and software
Repairs and renewals of equipment
Depreciation
Loss on sale of assets		 2023
£
869,637
14,902
884,539
2023
£
25,724
1,061,685
76,845
1,164,254
2023
£
33,629
443
378
389
133
-
136
4,934
108
40,150		 2022
£
899,357
2,081
901,438
2022
£
23,369
1,021,611
8,517		 2022
£
899,357
2,081		 2022
£
899,357
2,081
901,438
1,053,497
2022
£
27,052
241
508
82
171
83
17
22
-
28,176

Page 19

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

6. CHARITABLE ACTIVITIES COSTS

Grant
funding of
Direct
activities
Costs (see
(see note
note 7)
8)
£
£
Grants to dependants and ABF
The Soldiers' Charity
49,566
1,728,278
7.
DIRECT COSTS OF CHARITABLE ACTIVITIES
Staff costs
General insurance
Printing, postage, stationery, telephone and internet
Sundries
Travelling
Books and software
Repairs, renewals and office equipment
8.
GRANTS PAYABLE
Grants to dependants and ABF The Soldiers' Charity
The total grants paid to institutions during the year was as
follows:
ABF The Soldiers' Charity
The total grants paid to individuals during the year was as
follows:
Beneficiaries of deceased members		 Support
costs (see
note 9)
Totals
£
£
22,723
1,800,567
2023
2022
£
£
48,042
38,646
633
345
396
732
251
117
163
246
-
119
81
25
49,566
40,230
2023
2022
£
£
1,728,278
1,931,000
2023
2022
£
£
765,240
831,000
2023
2022
£
£
963,038
1,100,000		 Support
costs (see
note 9)
Totals
£
£
22,723
1,800,567
2023
2022
£
£
48,042
38,646
633
345
396
732
251
117
163
246
-
119
81
25
49,566
40,230
2023
2022
£
£
1,728,278
1,931,000
2023
2022
£
£
765,240
831,000
2023
2022
£
£
963,038
1,100,000		 Support
costs (see
note 9)
Totals
£
£
22,723
1,800,567
2023
2022
£
£
48,042
38,646
633
345
396
732
251
117
163
246
-
119
81
25
49,566
40,230
2023
2022
£
£
1,728,278
1,931,000
2023
2022
£
£
765,240
831,000
2023
2022
£
£
963,038
1,100,000		 Support
costs (see
note 9)
Totals
£
£
22,723
1,800,567
2023
2022
£
£
48,042
38,646
633
345
396
732
251
117
163
246
-
119
81
25
49,566
40,230
2023
2022
£
£
1,728,278
1,931,000
2023
2022
£
£
765,240
831,000
2023
2022
£
£
963,038
1,100,000
2022
£
38,646
345
732
117
246
119
25
40,230
2022
£
1,931,000		 2022
£
38,646
345
732
117
246
119
25
40,230
2022
£
831,000
2022
£
1,100,000		 2022
£
831,000

The total grants paid to individuals during the year was £963,038 (2021: £1,100,000).

Page 20

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

9. SUPPORT COSTS

9. SUPPORT COSTS
Governance
costs
£
Grants to dependants and ABF The
Soldiers' Charity 22,723
Support costs, included in the above, are as follows:
2023 2022
Grants to
dependants
and ABF
The
Soldiers' Total
Charity activities
£ £
Wages 12,915 10,400
Social security 1,393 1,104
Pensions 105 90
Auditors' remuneration 3,600 3,360
Audit under provided last year 672 -
Insurance 190 699
Legal fees 2,767 2,400
Subscriptions 1,081 1,029
Books and software - 36
22,723 19,118
10. AUDITORS' REMUNERATION
2023 2022
£ £
Fees payable to the charity's auditors for the audit of the
charity's financial statements 3,600 3,360

11. TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 31 December 2023 nor for the year ended 31 December 2022.

Trustees' expenses

There were no trustees' expenses paid for the year ended 31 December 2023 nor for the year ended 31 December 2022.

Page 21

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

12. STAFF COSTS

2023 2022
£ £
Secretary's salary 56,272 44,279
Other staff salaries 29,828 25,054
Social security 9,286 7,360
Secretary's pension contributions - -
Other staff pension contributions 698 599
96,084 77,292

No employees received emoluments in excess of £60,000.

The average monthly number of employees during the year calculated on a full time equivalent basis was 2 (2022: 2).

13. TOTAL RUNNING COSTS

The total running costs of the Charity for the year were £112,439 (2022: £87,524).

14. INTANGIBLE FIXED ASSETS

INTANGIBLE FIXED ASSETS
Computer
software
£
COST
Additions 23,166
AMORTISATION
Charge for year 4,633
NET BOOK VALUE
At 31 December 2023 18,533
At 31 December 2022 -

Page 22

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

15. TANGIBLE FIXED ASSETS

COST
At 1 January 2023
Additions
Disposals
At 31 December 2023
DEPRECIATION
At 1 January 2023
Charge for year
Eliminated on disposal
At 31 December 2023
NET BOOK VALUE
At 31 December 2023
At 31 December 2022
16.
FIXED ASSET INVESTMENTS
MARKET VALUE
At 1 January 2023
Revaluations
At 31 December 2023
NET BOOK VALUE
At 31 December 2023
At 31 December 2022		 Office
equipment
£
1,470
921
(1,470)
921
1,362
301
(1,362)
301
620
108
Unlisted
investments
£
24,880,230
(94,596)
24,785,634
24,785,634
24,880,230

The investments comprised holdings in a common investment fund, and unit trusts, with market values at the end of the year as follows:

2023 2022
£ £
The Armed Forces Charities Growth & Income Fund 19,256,654 19,200,282
Mayfair Property Income Trust for Charities 406,906 434,622
M&G Equities Investment Fund for Charities 5,122,074 5,245,326
24,785,634 24,880,230

Page 23

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

16. FIXED ASSET INVESTMENTS - continued

The investments are held primarily to provide an investment return for the Charity and were held in the UK.

17. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Members subscriptions due
Other debtors
Prepayments
CASH AT BANK
Lloyds current account
Lloyds deposit account
Charities deposit account
Total		 2023
£
832
11
1,118
1,961
2023
Total
funds
£
472,789
502,402
2,055,480
3,030,671		 2022
£
972
-
1,104
2,076
2022
Total
funds
£
1,957,633
-
881,510		 2022
£
972
-
1,104
2,076
2,839,143

18. CASH AT BANK

19. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Grants payable
Other creditors
Accrued expenses		 2023
£
20,000
229
3,600
23,829		 2022
£
20,000
208
6,240
26,448

Page 24

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

20. MOVEMENT IN FUNDS

MOVEMENT IN FUNDS
Net
movement At
At 1.1.23 in funds 31.12.23
£ £ £
Unrestricted funds
General fund 27,695,109 118,481 27,813,590
TOTAL FUNDS 27,695,109 118,481 27,813,590
Net movement in funds, included in the above are as follows:
Incoming Resources Gains and Movement
resources expended losses in funds
£ £ £ £
Unrestricted funds
General fund 2,053,793 (1,840,717) (94,595) 118,481
TOTAL FUNDS 2,053,793 (1,840,717) (94,595) 118,481
Comparatives for movement in funds
Net
movement At
At 1.1.22 in funds 31.12.22
£ £ £
Unrestricted funds
General fund 31,263,421 (3,568,312) 27,695,109
TOTAL FUNDS 31,263,421 (3,568,312) 27,695,109
Comparative net movement in funds, included in the above are as follows:
Incoming Resources Gains and Movement
resources expended losses in funds
£ £ £ £
Unrestricted funds
General fund 1,959,935 (2,018,524) (3,509,723) (3,568,312)
TOTAL FUNDS 1,959,935 (2,018,524) (3,509,723) (3,568,312)

Page 25

continued...

THE ARMY DEPENDANTS' TRUST

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 DECEMBER 2023

21. RELATED PARTY DISCLOSURES

Major General P Griffiths and Major General S Humphris MBE were both trustees of ABF The Soldiers' Charity at some point during the year. The Charity has power, in its Scheme, to make grants to ABF The Soldiers' Charity. A grant of £765,240 (2022: £831,000) was made to ABF The Soldiers' Charity during the year.

22. ULTIMATE CONTROLLING PARTY

The Charity was controlled throughout the year by the Trustees.

Page 26

THE ARMY DEPENDANTS' TRUST

DETAILED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2023

INCOME AND ENDOWMENTS
Donations and legacies
Members' subscriptions
Donations
Investment income
Property based investment income
Dividend income
Interest on cash deposits
Other income
Employers N.I. allowance
Total incoming resources
EXPENDITURE
Raising donations and legacies
Wages
Social security
Pensions
General insurance
Printing, postage, stationery, telephone
and internet
Sundries
Travelling
Books and software
Repairs and renewals of equipment
Computer software amortisation
Office equipment depreciation
Loss on sale of tangible fixed assets
Charitable activities
Wages
Social security
Pensions
Carried forward		 2023
£
869,637
14,902
884,539
25,724
1,061,685
76,845
1,164,254
5,000
2,053,793
30,135
3,250
244
443
378
389
133
-
136
4,633
301
108
40,150
43,050
4,643
349
48,042		 2022
£
899,357
2,081
901,438
23,369
1,021,611
8,517
1,053,497
5,000
1,959,935
24,266
2,576
210
241
508
82
171
83
17
-
22
-
28,176
34,667
3,680
299
38,646

This page does not form part of the statutory financial statements

Page 27

THE ARMY DEPENDANTS' TRUST

DETAILED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2023

Charitable activities
Brought forward
General insurance
Printing, postage, stationery, telephone
and internet
Sundries
Travelling
Books and software
Repairs, renewals and office equipment
Grant to ABF The Soldiers' Charity
Grants awarded to dependants
Support costs
Governance costs
Wages
Social security
Pensions
Auditors' remuneration
Audit under provided last year
Insurance
Legal fees
Subscriptions
Books and software
Total resources expended
Net income/(expenditure) before
gains and losses
Unrealised gains and losses
Gains/(losses) on investments
Net income/(expenditure)		 2023
£
48,042
633
396
251
163
-
81
765,240
963,038
1,777,844
12,915
1,393
105
3,600
672
190
2,767
1,081
-
22,723
1,840,717
213,076
(94,595)
118,481		 2022
£
38,646
345
732
117
246
119
25
831,000
1,100,000
1,971,230
10,400
1,104
90
3,360
-
699
2,400
1,029
36
19,118
2,018,524
(58,589)
(3,509,723)
(3,568,312)

This page does not form part of the statutory financial statements

Page 28