OpenCharities

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

2023-03-31-accounts

THE NGT FOUNDATION

ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

Registered company number: 03444689 Registered charity number: 1064635

1

THE NGT FOUNDATION

CONTENTS

Pages
Legal and administrative information 1
Trustees' Annual Report 2 - 4
Independent Auditor's Report 5 - 7
Statement of Financial Activities 8
Balance Sheet 9
Statement of cash flows 10
Notes to the financial statements 11 – 17

2

Legal and administrative information

The NGT Foundation was incorporated in England and Wales as a company limited by guarantee on 30 September 1997 (company number 03444689). It is registered as a charity with the Charity Commission (number 1064635). The foundation is governed by the memorandum and articles of association dated 30 September 1997 (amended 7 October 2005 and 12 October 2021).

Registered Office: The NGT Foundation Trafalgar Square London WC2N 5DN Trustees: The names of the Trustees who served during and since the year end are given below. David Marks (Chair) Catherine Bedford Ben Broadbent (appointed 21 February 2023) David Landau Daniel Peltz Natasha Pope (appointed 03 January 2023) Secretary: Victoria Hayes Bankers: Coutts & Co St Martin’s Office 440 Strand London WC2R 0QS Auditor: Price Bailey – Statutory Auditor 24 Old Bond Street London W1S 4AP Solicitors: Hamlins LLP Roxburghe House 273-287 Regent Street London W1B 2AD Managing agent: Ashdown Phillips & Partners Ltd Pippingford Manor Nutley East Sussex TN22 3HW

1

Trustees' Annual Report (incorporating the Director's report) for the year ended 31 March 2023

Structure, governance and management

The Trustees submit their Trustees’ Annual Report, which includes the Directors' Report for Companies Act purposes and the audited financial statements of the NGT Foundation for the year ended 31 March 2023. The Trustees’ Annual Report has been prepared in accordance with the provisions applicable to small companies entitled to the small company’s exemption, including the exemption not to include a Strategic Report.

The NGT Foundation ("the Foundation") is a public benefit entity which is governed by a Board of Trustees. Power to appoint new Trustees is exercisable by surviving or continuing Trustees. Trustees are normally appointed for a period of five years with the possibility of reappointment. They are fully briefed on the objectives of the Foundation and their role as Trustees as part of their induction. Further training is available as necessary.

The Board of Trustees consists of a Chairman and five Trustees, chosen for their skills and experience. The Board of Trustees is responsible for providing governance and leadership for the Foundation and for taking all important decisions. Under a service level agreement, administration of the Foundation is undertaken by staff of the National Gallery and by the managing agent. The Foundation does not directly employ any staff.

Related parties

At any point during the year there was one Trustee of the Foundation who was also a Trustee of the National Gallery. Full details of transactions with related parties are given in note 10 to the financial statements.

Risk management

The Trustees have assessed the major risks to which the Foundation is exposed and consider that adequate systems are in place to mitigate exposure to those risks where possible. The Foundation seeks to maintain its property, St Vincent House, so as to enhance its value; and to sustain, and where possible increase, rental income from tenants. A key risk is that market conditions cause the value of the property to decrease or rents to fall, but the Foundation has a planned cycle of maintenance works to maintain the property in optimum condition and mitigate this risk. It also seeks the advice of experienced professionals when negotiating any new leases or lease extensions, to maximise rental values.

Going concern

Having scrutinised forecasts in light of the revised rental settlements reached with tenants and subsequent reduction in income, Trustees are satisfied of the Foundation's ability to meet its obligations as they fall due in the period of twelve months following the date of approval of these financial statements. The financial statements have been prepared on the going concern basis.

Charitable objects for the benefit of the public

The objectives of the Foundation are to support the charitable objects of the National Gallery and to assist the National Gallery in carrying out its charitable objects by such means as shall be thought fit. The Trustees confirm that they have referred to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the Foundation's aims and objectives and in planning future activities.

The Foundation was established with the support of a grant for the purpose of acquiring a property (St Vincent House), for the long-term benefit of the National Gallery. The net rental income from the property, after making adequate provision for property refurbishment and maintenance costs, is used to further the objectives of the charity.

2

The Foundation seeks to support the gallery yearly from the surpluses generated from the investment property.

Current year activities

The Foundation's main aim at present is to keep up over time the level of support it is able to give to the National Gallery by means of grants to the National Gallery Trust. To that end the Foundation seeks to maintain its property, St Vincent House, so as to enhance its value; and to sustain, and where possible increase, rental income from tenants.

Pennine Way Limited started occupying the upper ground east and first floors in August 2022, taking tenancy over from National Gallery Global Limited and the National Gallery.

Achievements and performance

Rental and service charge income for the year was at £2.6 million (2022: £2.5 million). This was offset by a loss on the valuation of the investment property of £3.3m (2022: £0.95m). The freehold interest in St Vincent House as at 31 March 2023 was estimated to be of the value of £38 million (2022: £41.3 million). A market valuation was performed by Montagu Evans LLP as at 31 March 2023. The Foundation agreed a grant from general funds of £1.65 million (2022: £1.5 million) to the National Gallery Trust. The Foundation employs no staff and uses agents to manage its investment properties.

Plans for future periods

Having now fully let St Vincent House, the Foundation will focus on maintaining the level of the annual grant to NGT, and ensuring the estate remains in good order and well maintained.

Policies

Grant-making policy

Grants are made only with the agreement of the Board of Trustees. Grants are made to the National Gallery Trust to the extent that resources allow, to be used by the Trust for the benefit of the National Gallery, in accordance with the charity's objectives.

Investment policy

The Trustees have considered the most appropriate policy for investing funds and decided that placing funds in a short-term money market deposit meets their requirement to generate income without compromising liquidity. The investment property is largely represented by expendable endowment and valuation reserves. The Trustees review the open market value of the property annually, revalue the property to fair value and approve refurbishment works to enhance its value. The movement in fixed asset investments during the year is set out in note 5 to the financial statements.

Reserves policy

The reserves policy is to ensure that the level of general reserves is adequate to meet the needs of the Foundation. The Trustees have reviewed the reserves of the Foundation. This review encompassed the nature of income and expenditure streams, the current market for rental property and the likelihood of future capital works being required. The review concluded that the current level of general reserves would be adequate to meet the needs of the Foundation, together with the £500,000 designated in previous years for property maintenance. There is no formal target set for the level of general reserves to be maintained outside this designation, but in recent years they have been maintained at around £4 million. Further information on reserves can be found in notes 8 and 9.

Fundraising policy

The Foundation understands its duty to protect the public, including vulnerable people, from unreasonably intrusive or persistent fundraising approaches, and undue pressure to donate but does not currently fundraise from the public or use any internal fundraisers or external fundraising agencies

3

for either telephone or face to face campaigns and received no fundraising complaints during the year.

Trustees' responsibility statement

The Trustees (who are also directors of NGT Foundation for the purposes of company law) are responsible for preparing the Trustees' 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 Trustees to prepare financial statements for each financial year. Under company law the Trustees 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 charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company's transactions and disclose with reasonable accuracy at any time the financial position of the charitable company 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 charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Disclosure of Information to Auditors

Each of the persons who are Trustees at the time when this Trustees' report is approved has confirmed that:

This report was approved by the Trustees on ��/10/23 and signed on its behalf by

David Marks

4

Independent Auditor’s Report to the Members of The NGT Foundation for the year ended 31 March 2023

Opinion

We have audited the financial statements of The NGT Foundation (the ‘charitable company’) for the year ended 31 March 2023 which comprise the Statement of Financial Activities, Balance Sheet and Cashflow 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, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

Other information

The Trustees are responsible for the other information. The other information comprises the information included in the trustees’ annual report other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

5

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 4, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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:

We gained an understanding of the legal and regulatory framework applicable to the Charitable Company and the sector in which it operates and considered the risk of the Charitable Company not complying with the applicable laws and regulations including fraud in particular those that could have a material impact on the financial statements. This included those regulations directly related to the financial statements, including financial reporting, and tax legislation. In relation to the operations of the Charitable Company this included compliance with the Charities Act 2011 and SORP 2019.

The risks were discussed with the audit team and we remained alert to any indications of noncompliance throughout the audit. We carried out specific procedures to address the risks identified. These included the following:

6

Reviewing minutes of Board meetings, reviewing any correspondence with the Charity Commission, agreeing the financial statement disclosures to underlying supporting documentation, and made enquiries of officers of the Charitable Company. We have also reviewed the procedures in place for the reporting of any incidents to the Board of Trustees including serious incident reporting of these matters as necessary with the Charity Commission.

Management override: To address the risk of management override of controls, we carried out testing of journal entries and other adjustments for appropriateness. We reviewed systems and procedures to identify potential areas of management override.

We also assessed management bias in relation to the accounting policies adopted and in determining significant accounting estimates.

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 reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

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.

The use of our report

This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Helena Wilkinson FCA Senior statutory auditor For and on behalf of Price Bailey LLP (Statutory auditors) 24 Old Bond Street London W1S 4AP

Date: 30 October 2023

7

THE NGT FOUNDATION

Statement of Financial Activities (incorporating the income and expenditure account) For the year ended 31 March 2023

Note
Income
Investment income
2
Total income
Expenditure on
Costs of raising funds
Investment property management costs
3
Charitable activities
3
Total expenditure
Loss on investment asset
5
Net income/(expenditure)
Net movement in funds
Total funds at 1 April
Total funds at 31 March
8,9		 Unrestricted
Expendable
Total
Total
Funds
Endowment
Funds
Funds
2023
2023
2023
2022
£
£
£
£
2,568,779
-
2,568,779
2,517,016
2,568,779
-
2,568,779
2,517,016
(848,515)
-
(848,515)
(574,793)
(1,672,673)
-
(1,672,673)
(1,527,355)
(2,521,188)
-
(2,521,188)
(2,102,148)
(421,897)
(2,878,103)
(3,300,000)
(1,099,197)
(374,306)
(2,878,103)
(3,252,409)
(684,329)
(374,306)
(2,878,103)
(3,252,409)
(684,329)
6,306,016
36,659,458
42,965,474
43,649,802
5,931,710
33,781,355
39,713,065
42,965,473

All of the above results are derived from continuing activities.

The company has no recognised gains or losses other than those stated above. For full details of the prior year comparatives please see note 12.

The notes on pages 1� to 1� form part of these financial statements.

�

THE NGT FOUNDATION

Registered company number: 03444689

Balance Sheet As at 31 March 2023

Note
Fixed assets
Investments
5
Current assets
Debtors due within one year
6
Debtors due after one year
6
Investments
5
Cash at bank and in hand
Creditors
Amounts falling due within one year
7
Net current assets
Net assets
Represented by:
Unrestricted funds:
Designated funds
8
General funds
8
Revaluation reserve
8
Expendable endowment:
Expendable endowment
8
Revaluation reserve
8
Total funds		 £
£
37,950,000
1,227,256
734,895
30,341
2,466,105
4,458,597
(2,695,534)
1,763,063
39,713,063
500,000
4,121,541
1,310,167
5,931,708
19,500,000
14,281,355
33,781,355
39,713,063
2023		 £
£
37,950,000
1,227,256
734,895
30,341
2,466,105
4,458,597
(2,695,534)
1,763,063
39,713,063
500,000
4,121,541
1,310,167
5,931,708
19,500,000
14,281,355
33,781,355
39,713,063
2023		 £
£
41,250,000
1,531,459
348,193
30,061
1,972,937
3,882,650
(2,167,177)
1,715,473
42,965,473
500,000
4,073,951
1,732,064
6,306,015
19,500,000
17,159,458
36,659,458
42,965,473
2022		 £
£
41,250,000
1,531,459
348,193
30,061
1,972,937
3,882,650
(2,167,177)
1,715,473
42,965,473
500,000
4,073,951
1,732,064
6,306,015
19,500,000
17,159,458
36,659,458
42,965,473
2022
500,000
4,121,541
1,310,167
19,500,000
14,281,355		 500,000
4,073,951
1,732,064
19,500,000
17,159,458
39,713,063 42,965,473
5,931,708
33,781,355		 6,306,015
36,659,458
39,713,063 42,965,473

The notes on pages 1� to 1� form part of these financial statements.

The financial statements are prepared in accordance with the special provisions relating to small companies within part 15 of the Companies Act 2006.

Approved and authorised for issue by the Board of Trustees on 30/10/2023

and signed on its behalf by:

David Marks

�

THE NGT FOUNDATION

Statement of cash flows

For the year ended 31 March 2023

2023 2022
Note £ £
Cash flows from operating activities
Net cash (used by)/provided by operating activities (i) 483,394 (831,548)
Cash flows from investing activities
Interest received 10,055 322
Purchase of fixed assets - (149,197)
Net cash provided by investing activities 10,055 (148,875)
Change in cash and cash equivalents in the reporting period 493,449 (980,423)
Cash and cash equivalents at the beginning of the reporting period 2,002,998 2,983,421
Cash and cash equivalents at the end of the reporting period (ii) 2,496,446 2,002,998
Notes to the Statement of cash flows
(i) Reconciliation of net income to net cash flow
from operating activities 2023 2022
£ £
Net (expenditure) for the reporting period
(as per SoFA) (3,252,409) (684,329)
Loss on investment 3,300,000 1,099,197
Interest income (10,055) (322)
(Increase)/decrease in debtors (82,499) (847,671)
Increase in creditors and provisions 528,357 (398,423)
Net cash (used by) provided by operating activities 483,394 (831,548)
(ii) Analysis of cash and cash equivalents 2023 2022
£ £
Cash held with commercial banks 2,466,105 1,972,937
Deposit accounts (90 days notice) 30,341 30,061
Cash held with commercial banks 2,496,446 2,002,998
(iii) Net debt reconciliation
As at 1 April As at March
2022 Cash Flows 2023
Cash and Cash Equivalents £ £ £
Cash 2,002,998 493,448 2,496,446

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023

1. Accounting Policies

a) Accounting convention

The financial statements are prepared under the historic cost convention as modified by the valuation of certain investments and in accordance with the recommendations set out in the Statement of Recommended Practice (SORP) 'Accounting and Reporting by Charities' published in 2019, the Financial Reporting Standard 102, other applicable accounting standards and the Charities Act 2011. The NGT Foundation is a public benefit entity. The Company's functional and presentational currency is Pounds Sterling.

b) Going concern

Trustees have carefully evaluated finacial forecasts in conjunction with the timetable for replacing currently vacant floors. Based on contractual income, expected costs, and the existing levels of reserves, Trustees are satisfied with the Foundation's ability to meet its obligations as they fall due in the period of twelve months following the date of approval of these financial statements. The financial statements have therefore been prepared on the going concern basis.

c) Company status

The Foundation is a company limited by guarantee. The guarantors are the Trustees named on page 1. The liability in respect of the guarantee, as set out in the memorandum, is limited to an amount not exceeding £1 per member of the company. The Foundation has availed itself of Paragraph 3 (3) Schedule 4 of the Companies Act and adapted the Companies Act formats to reflect the special nature of the company's activities.

The registered office of the Foundation is: National Gallery, Trafalgar Square, London WC2N

d) Rental income

Future minimum lease payments receivable under non-cancellable operating leases are disclosed in note 11.

Where income is received in advance, and the NGT Foundation does not have entitlement to these resources until the services have been provided, the income is deferred in the accounts.

e) Service charge income and related property costs

Service charge income from tenants to reimburse the Foundation for property costs and the expenditure to which it relates are recognised in full in the Statement of Financial Activities.

f) Donations

Cash donations, gifts and legacies are included in full in the Statement of Financial Activities when the NGT Foundation is legally entitled to the income, when receipt is probable and when the amount can be quantified with reasonable accuracy.

g) Expenditure

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Governance costs are allocated based on the direct expenditure of the activity. These costs include the costs of statutory audit, costs associated with constitutional and statutory requirements, and reimbursed Trustee expenses. Grants payable are recognised when the grant is approved by the board of Trustees and communicated to the recipient.

No support costs are allocated to the endowment.

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

1. Accounting Policies (continued)

h) Investments

Investments comprise a freehold investment property and short-term deposits. In accordance with FRS 102 Section 16, investment properties are measured at fair value at each reporting period and all changes in fair value of the investment property are included in net income. This year a market valuation was performed as at 31 March 2023 by Montagu Evans LLP, Chartered Surveyors. Any surplus or deficit is included in net income/expenditure. The unrealised gains or losses are apportioned between unrestricted funds and the expendable endowment, in line with how the original cost of the property was funded.

i) Current Asset Investments

Current asset investments comprise deposits held for investment purposes with a notice period of thirty days or more.

j) Unrestricted Funds

The funds include income arising from the NGT Foundation's investments where no restriction exists as to the use of the funds. Income is recognised as it arises and is allocated as explained in the Statement of Financial Activities. Designated funds are amounts set aside out of unrestricted funds by the Trustees for specific purposes.

k) Expendable endowment

The expendable endowment fund represents a capital grant to the charity, given to enable the charity to purchase an investment property. The investment property provides the charity with an income stream for its charitable purposes. The Trustees are able to convert capital to income.

l) Taxation

The NGT Foundation is a registered charity and is therefore potentially exempt from taxation of its income and gains to the extent that they fall within Chapter 3 of Part 11 to the Corporation Tax Act 2010, Part 10 of the Income Tax Act 2007 and section 256 of the Taxation of Chargeable Gains Act 1992. No direct tax charge has arisen this year. Other taxes detailed in note 7 relate to a VAT liability.

m) Financial instruments

The Foundation's financial instruments, as defined in FRS 102 section 11, consist of investments, cash, debtors and creditors. Investments are discussed in note 1(h). The measurement of debtors is based on the anticipated recoverable value of cash or services owed to the Foundation at the end of the year. Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due. Cash at bank and cash 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.

Information on the NGT Foundation's overall approach to financial risk management may be found in the investments, reserves and risk sections of the Annual Report.

n) Critical accounting judgements and key sources of estimation uncertainty

In the application of the charities accounting policies, which are described above, the Trustees are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The Trustees do not consider there to be any sources of estimation uncertainty requiring disclosure beyond the accounting policies listed above. The Trustees consider the valuation of the investment property to be a critical judgement further details of the valuation are given in note 5.

m) The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and

subsequently measured at their settlement value with the exception of:

2. Investment income
Rental income
Service charge income
Other costs recharged to tenants (insurance and electricity)
Interest on UK cash deposits and overdue rent		 2023
2022
£
£
2,158,724
2,282,978
361,441
209,794
38,559
23,922
10,055
322
2,568,779
2,517,016

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

Investment income (continued)
Interest on UK cash deposits and overdue rent
Interest on 90-day notice account
Interest on special reserve account
Interest on overdue rent
Total interest on UK cash deposits and overdue rent
3. Expenditure
Direct
Support
Costs
Costs
£
£
Investment management activities
837,013
11,502
Charitable activities
1,650,000
22,673
2,487,013
34,175
Investment management activities
Service charge expenditure
Other costs recharged to tenants (insurance, electricity and other costs)
Property management costs
Administrative costs
Charitable activities
Grants to the National Gallery Trust		 Direct
Support
Costs
Costs
£
£
837,013
11,502
1,650,000
22,673		 2023
2022
£
£
280
35
9,475
220
299
67
10,054
322
Total
Total
2023
2022
£
£

848,515
574,793

1,672,673
1,527,355
2,487,013
34,175
2,521,188
2,102,148
2023
2022
£
£
473,541
474,712
64,779
53,619
182,594
32,228
116,099
3,939
837,013
564,498
2023
2022
£
£
1,650,000
1,500,000

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

Expenditure (continued)

Expenditure (continued)
Support costs and Governance
Auditor's remuneration
Fees payable to the charitable company's auditor for
the audit of the annual Financial Statements
Cost of professional valuation of investment property
National Gallery accounting and administration fee		 2023
2022
£
£
6,775
6,750
6,000
3,000
21,400
27,900
34,175
37,650

4. Staff costs and Trustees' remuneration

NGT Foundation does not employ staff directly. During the year ended 31 March 2023 services were provided by the National Gallery at a charge of £21,400 (2022: £27,900).

The Trustees neither received nor waived any remuneration for their services during the year (2022: £nil). No Trustee travel expenses were reimbursed during the year (2022: £nil).

5. Investments

Fixed Assets

xed Assets
Value brought forwards
Additions
Disposals
Revaluations
Value carried forwards
Cost		 2023
2022
£
£
41,250,000
42,200,000
-
149,197
-
-
(3,300,000)
(1,099,197)
37,950,000
41,250,000
22,358,479
22,358,479

A desktop market valuation of the investment property was undertaken by Montagu Evans LLP, Chartered Surveyors, as at 31 March 2023 which shows the overall value decreased by £3.3m from the prior year (2022: £1.1m decrease).

This fall in value is in part due to a reduction in income resulting from tenant vacancies, and the associated vacancy costs related to that space prior to reletting. Furthermore, the expected rental value on the vacant office space has been reduced in line with current Market Rents and the interest received to date in the marketing of the space.

In addition, there are a number of leases with relatively short unexpired terms, with the uncertainty associated with upcoming lease expiries and break options factored into the valuation with a slight outward shift in the capitalisation rates adopted on the future income to reflect the uncertainty on the future income associated with that accommodation.

Current Assets

urrent Assets
2023 2022
£ £
UK current asset investments 30,341 30,061

Current asset investments comprise deposits held for investment purposes with a notice period of thirty days or more.

6. Debtors
Trade debtors
Prepayments and accrued income
Analysis of debtors by due date
Amounts falling due within one year
Amounts falling due in more than one year		 2023
2022
£
£
1,304,410
1,524,336
657,744
355,319
1,962,154
1,879,655
2023
2022
£
£
1,227,256
1,531,459
734,895
348,193
1,962,151
1,879,652

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

7. Creditors

Amounts falling due within one year:
Other creditors
Accruals and deferred income
Other taxes		 2023
2022
£
£
1,862,694
1,578,865
724,918
509,567
107,922
78,745
2,695,534
2,167,177

Other creditors includes an amount of £1.65m (2022: £1.5m), being the grant payable to the National Gallery Trust. There are no creditor balances that are due in more than one year; all balances are payable within one year.

The movement on the deferred income balance in the year was as follows:
As at 1 April
Amounts released from previous years
Income deferred in the current year
As at 31 March		 2023
2022
502,208
372,774
(502,208)
(372,774)
715,583
502,208
715,583
502,208

Deferred income relates to rental and service charge income that is invoiced to tenants quarterly, in advance. The income relating to the first quarter of the next financial year, which is billed in March, therefore needs to be deferred, so that it is recorded in the financial period to which the rent and service charges relate.

8. Funds

Funds
Unrestricted funds:
Designated funds - property
maintenance reserve
General funds
Revaluation reserve
Total unrestricted funds
Expendable endowment:
Expendable endowment - general
Expendable endowment - revaluation
reserve
Total expendable endowment
Total funds		 Balance at 1
April 2022
Income
Expenditure
Loss on
revaluation of
investment
property
Balance at 31
March 2023
£
£
£
£
£
500,000
-
-
-
500,000
4,073,951
2,568,779
(2,521,189)
-
4,121,541
1,732,064
-
-
(421,897)
1,310,167
6,306,015
2,568,779
(2,521,189)
(421,897)
5,931,708
19,500,000
-
-
-
19,500,000
17,159,458
-
-
(2,878,103)
14,281,355
36,659,458
-
-
(2,878,103)
33,781,355
42,965,473
2,568,779
(2,521,189)
(3,300,000)
39,713,063

The expendable endowment fund represents a capital grant to the NGT Foundation which enabled it to purchase Saint Vincent House and the attributed upon revaluation.

Prior year Funds note

rior year Funds note
Unrestricted funds:
Designated funds - property
maintenance reserve
General funds
Revaluation reserve
Total unrestricted funds
Expendable endowment:
Expendable endowment - general
Expendable endowment - revaluation
reserve
Total expendable endowment
Total funds		 Balance at 1
April 2022
Income
Expenditure
Loss on
revaluation of
investment
property
Balance at 31
March 2022
£
£
£
£
£
500,000
-
-
-
500,000
3,659,084
2,517,016
(2,102,149)
-
4,073,951
1,872,594
-
-
(140,530)
1,732,064
6,031,678
2,517,016
(2,102,149)
(140,530)
6,306,015
19,500,000
-
-
-
19,500,000
-
18,118,125
-
-
(958,667)
17,159,458
37,618,125
-
-
(958,667)
36,659,458
43,649,803
2,517,016
(2,102,149)
(1,099,197)
42,965,473

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

9. Analysis of net assets between funds

. Analysis of net assets between funds
Unrestricted funds
Expendable endowment
Total funds
Unrestricted funds
Expendable endowment
Total funds		 Fixed
Net current
Net current
Total
assets
assets
liabilities
2023
£
£
£
£
4,168,645
4,458,597
(2,695,534)
5,931,708
33,781,355
-
-
33,781,355
37,950,000
4,458,597
(2,695,534)
39,713,063
Fixed
Net current
Net current
Total
assets
assets
liabilities
2022
£
£
£
£
4,590,542
3,882,650
(2,167,177)
6,306,015
36,659,458
-
-
36,659,458
41,250,000
3,882,650
(2,167,177)
42,965,473

10. Related party transactions

Details of related party transactions for the year ended 31 March 2023 are shown below. Comparative balances for the prior year are shown in italics against each related party.

**Related Party ** Nature of relationship Nature of relationship Nature of relationship Nature of relationship Year Value of income in Value of expenditure Outstanding Nature of transactions Nature of transactions
year in year balances due
(to)/from at year
end
£ £ £
National The
National		 Gallery Global 2022-23 - - 174,885 Rent and service charge
Gallery Global Limited
is		 a wholly owned paid to the Foundation by
Limited subsidiary of the National the related party.
Gallery, a related party.
2021-22 (2,390) - (3,045)
The National At any one time during the year, 2022-23 (7,857) 21,400 (61,450) Rent and service charge
Gallery one
Trustee		 of the NGT paid by the related party to
Foundation served as Trustee of the
Foundation;		 annual
the National Gallery. accounting
fee		 and
security
patrol		 charges
paid by the Foundation to
the related party.
2021-22 413,355 27,900 (29,271)

There were no other related party transactions (2022: Nil).

11. Future lease payments receivable

Future minimum lease payments receivable under non-cancellable operating leases:
no later than one year
later than one year and not later than five years
later than five years
Total future minimum lease payments receivable under non-cancellable operating leases		 2023
2022
£
£
2,146,018
1,715,422
8,680,097
6,378,498
2,534,915
3,107,453
13,361,030
11,201,373

1�

THE NGT FOUNDATION

Notes to the Financial Statements for the year ended 31 March 2023 (continued)

12. Prior Year Statement of Financial Activities For the year ended 31 March 2022

Income
Investment income
Total income
Expenditure on
Costs of generating funds
Investment management costs
Charitable activities
Total expenditure
Loss on investment asset
Net expenditure for the year
Net movement in funds
Total funds at 1 April
Total funds at 31 March		 Unrestricted
Expendable
Total
Funds
Endowment
Funds
2022
2022
2022
£
£
£
2,517,016
-
2,517,016
2,517,016
-
2,517,016
(574,793)
-
(574,793)
(1,527,355)
-
(1,527,355)
(2,102,148)
-
(2,102,148)
(140,530)
(958,667)
(1,099,197)
274,338
(958,667)
(684,329)
274,338
(958,667)
(684,329)
6,031,678
37,618,125
43,649,803
6,306,016
36,659,458
42,965,473

1�