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2022-03-31-accounts

DougieNAac Douglas Macmillan Hospice Trustees, report & financial statements for the year ended 31st March 2022 Charity Registration No. 1071613 Company Registration No. 03615904 (England & Wales)

Dougiemac Our Vision is... to be admired as a centre of excellence for palliative and end of life ca re. Our Mission is... to respond to the increasing needs of those in our care across our heartland by growing as a sustainable organisation delivering outstanding value for money for all our funding sources and always remaining true to our core values. Our Values are... ompassion Working together by considering the views of others, understanding the challenges they face and providing support. ccountability Taking personal responsibility for our actions, owning our decisions and behaviours. espect Always trusting, listening and challenging each other. Understanding that we are at our best as individuals whilst working as a team. xcellence Embracing excellence by empowering and motivating each other to be the best that we can be. www.dougiemac.org.uk Dougiemac Dougiemocstoke DougieMocHospice

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

CONTENTS

Page
Reference and administrative information 1
Trustees’ report (incorporating the directors’ report and strategic report) 2 – 8
Independent auditor’s report 9 – 11
Consolidated statement of financial activities 12
Consolidated balance sheet 13
Consolidated cash flow statement 14
Notes to the financial statements 15 - 32

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

REFERENCE AND ADMINISTRATIVE INFORMATION

FOR THE YEAR ENDED 31 MARCH 2022

Douglas Macmillan Hospice is a company limited by guarantee and a registered charity governed by its Memorandum and Articles of Association.

Officers

The current Trustees (Directors) and those who held office during the financial year to 31st March 2022 are listed below:

Mr D Platt (Chair) Mr K Brown Mrs J Miller Mrs J Neyt Mrs M Rathbone Ms L Rowley Dr J Sissons Dr E Slade Mr T Stanway Mrs K McKenzie Company Secretary Mr D Webster Chief Executive Officer Mr D Webster Director of Care Mrs J McCartney Director of HR & Support Services Mrs C Hammond Director of Income Generation Mrs K McKenzie Director of Finance Mrs V Dean

Mrs S Evans (Vice Chair) Mrs J Miller Mrs M Rathbone Dr J Sissons Mr T Stanway

Legal and Administrative Information

Company Number Charity Number Registered Office Auditors

3615904 1071613 Barlaston Road Stoke-on-Trent ST3 3NZ

Geens Limited Chartered Accountants 68 Liverpool Road Stoke-on-Trent ST4 1BG

Principal Bankers

Lloyds Banking Group 46 High Street Newcastle-under-Lyme ST5 1QY

Solicitors

Tinsdills Limited Hays House, 25 Albion Street Hanley Stoke-on-Trent ST1 1QF

1

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

TRUSTEES’ REPORT

FOR THE YEAR ENDED 31 MARCH 2022

As Chairman of the Trustee Board of Douglas Macmillan Hospice it is my great pleasure to present the Annual Report and Audited Financial Statements for the financial year ended 31 March 2022, on behalf of the Board of Trustees who are also Directors of the charity for the purposes of the Companies Act 2006.

Douglas Macmillan Hospice, better known colloquially as Dougie Mac, was formed in 1973 and as we progress towards our 50th birthday in the Spring of next year it is gratifying to reflect on such an outstanding past year for our hospice, both in terms of financial sustainability and in regard to the impact our clinical services have had on our local community. Dougie Mac continues to evolve, to grow and to innovate; characteristics which would certainly resonate with the founders of the hospice back in 1973.

At the heart of that evolution has been the integration of the childrens and young adults services following the formal merger of The Donna Louise Trust into Dougie Mac in March 2021. Our apex goal is to create a formidable “single hospice” (on two sites) delivering outstanding care to those in need of our expertise whether they are infants or elderly, and to do so with the core hospice values, professionalism and robust financial disciplines which have served Dougie Mac so well. The hospice Trustees chose to retain the name “The Donna Louise” for the childrens hospice to distinguish the unique nature of childrens hospice care. Retaining this name is favored by the families of those children who use our services and it underlines the child-friendly dimension of our hospice. Weaving those services that are tailored to children and young adults into the clinical services traditionally delivered by Dougie Mac has been facilitated by successfully creating “single hospice” support functions such as Marketing, IT, HR, Fundraising, Finance and Executive Leadership. This in turn has led to significant cost savings in back office overheads allowing us to invest more in our clinical teams. Consequently our childrens and young adult services have blossomed during this past financial year, with the return to 7 Day opening at the childrens unit and the opening of the Young Adult unit for day visits and overnight respite.

Alongside this transformational evolving of Dougie Mac this year, we have also successfully navigated the inevitable post-Covid19 turbulence and have coped admirably with the aftermath of the pandemic. Most of our clinical services have seen a rise in patient numbers symbolic of a more typical year. For instance, community visits by our Palliative Care Nurse Specialists rose to 8840 (2020/21: 5198), we do however recognize that we still have some way to go to reach the peak activity level of 2019/20 where 14,594 community visits were made. Our 24/7 Advice Line continues to thrive with 12,419 calls received this year, a 24% uplift on the previous year. Interestingly our In Patient Unit recorded 268 admissions this year which is around 60% of normal capacity, but this reflects the enduring uncertainty throughout the year across our health care system, and acts as a platform for the current work we are undertaking with colleagues in the health sector to reinforce our role as a collaborating partner in the emerging Integrated Care System.

To conclude, this past year has been hugely successful for Dougie Mac and immensely satisfying for our Board of Trustees and for the Executive Leadership team at the hospice. We all feel hugely indebted to our magnificent staff for their commitment, compassion and tenacity during a year of relentless change and rebalancing of priorities. Thriving through periods of change is a hallmark of a successful, contemporary organisation and Dougie Mac has received several prestigious awards in recent times for our culture and our engagement with staff. Such accolades simply confirm what the hospice Trustees already know, that Dougie Mac is a very special place, with an authentic vision for our future beyond our 50th birthday next year.

2

Financial Review

The financial statements for the year have been prepared in accordance with the Statement of Recommended Practice Accounting and Reporting by Charities (SORP 2015) and comply with all statutory requirements and the hospice's governing document. The financial statements consolidate the results of Douglas Macmillan Hospice and its trading subsidiaries.

At the end of another challenging year Trustees of the Dougie Mac are pleased to report an exceptional financial performance that far exceeded our expectations. During the 12 months to 31 March 2022 we’re delighted to report a net increase to overall funds for the year of £6.6 million (2020/21: £9.1 million increase) and an overall funds balance of £27.8 million at 31 March 2022 (£21.2 million at 31 March 2021).

Total consolidated income for the year was £20.3 million, an increase of £1.5 million on the previous year. Total consolidated expenditure increased by £3.2 million from 2020/21 (£11.6 million) to £14.8 million. From an operating perspective, 2021/22 showed a surplus of £5.6 million before investment gains and pension liability movements of £1 million (2020/21: £1.8 million gain); the reasons for this are outlined below.

The Statement of Financial Activities is set out on page 12 of these financial statements, the financial position of the group is set out in the balance sheet on page 13. The Reserves Policy relating to the funds held by the hospice is described in the Reserves Policy on page 7.

INCOME AND EXPENDITURE

Unrestricted Donations

Subsequent to a reformed income generating strategy focused on postCOVID fundraising trends, unrestricted donations from our dependable and generous local supporters increased by 9% to £1.7 million (2020/21: £1.5 million); Legacy income more than doubled to an unprecedented high of £3.9 million (2020/21: £1.8 million).

£1.66m 9% p from last year

Retail

In 2021/22 we were able to welcome shoppers through our charity shop doors safely again. Limits on the number of people in store at one time were £3.6m gradually relaxed, volunteers made a phased return to their pre-COVID roles and “normal” opening hours resumed. As the financial year progressed our 9% p from Retail income continued to grow, hitting a record breaking high of £3.6 million pre-pandemic levels by the end of the year, a 9% increase on pre-pandemic levels.

Lottery had another solid year furthering its rebound from Covid-19. The continuing successful recruitment of new lottery members resulted in an increase in income of 9%, and a subsequent net profit of £942,886 (2020/21: £894,777), an increase of 5%.

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Fundraising Events

£1.5m 11% p from pre-pandemic levels

Despite the ongoing, challenging fundraising environment, and thanks to the hard work and commitment of staff, the overall contribution towards hospice running costs from all of Dougie Macs income generating areas was £10.8 million net of costs, a notable recovery from 2020/21 and a 77% increase from pre-pandemic levels. 2022 is looking promising and we are confident that our diversification of income streams will continue to deliver a significant contribution towards funding our clinical strategy and steer us safely to our 50[th] birthday.

Everyone at the Dougie Mac sends their heartfelt thanks for the unwavering support we continue to receive from our community; without your steadfast backing we could not achieve our mission of responding to the increasing needs of those in our care across our heartland.

Income from Charitable Activities

Once again the pandemic placed enormous stress on an already fragile healthcare system and Dougie Mac staff were at the forefront of that battle continuing to care for our patients and their families, whilst also easing the burden on the NHS. As a result, NHS England supported the Hospice with just over £1 million emergency funding enabling the hospice to make available bed capacity and provide much needed community support for the period December 2021 to March 2022. The hospice was also fortunate to receive a further £730k in emergency funding to support the NHS during the Omicron wave of the pandemic. Our annual grant from NHS Clinical Commissioning Groups (CCGs) fell by 6% to £2.8 million (2020/21: £3.0 million) meaning our statutory income amounts to just 14% of total income for the year (2020/21: 16%); funding pressures continue to exist in the NHS with inflationary cost increases not being matched by increases in charitable activity funding.

Expenditure

As an amalgamated single hospice over two sites, the support costs of providing organisational services such as IT, HR, facilities maintenance, Marketing, Finance, Learning & Development, Governance and Executive Leadership are now spread across 401 members of staff (2020/21: 339) and 800 volunteers.

78% of expenditure for 2021/22, £11.5 million (2020/21: £8.9 million), was spent on providing our clinical services, 22%, or £3.2 million (2020/21: £2.8 million), was the costs incurred in raising funds for the two hospice sites.

Staff costs equated to 76% of total expenditure, of which 63% were clinical salaries. A detailed breakdown of costs is set out in notes 7 to 10 and notes 14 to 15.

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On the whole, following the merger between Douglas Macmillan Hospice and Donna Louise Trust, costs have increased by 27% to 14.8 million. 2022/23 will see costs increase further as we expand our clinical services, mainly our services for young adults, but as a well-capitalised hospice with substantial cash-flows and an outstanding reputation for clinical care, Dougie Mac is well placed to continue to make a formidable contribution to the health economy in our heartland.

Defined Benefit Pension Scheme

The actuarial gain in the pension fund is £0.9 million and is shown in the Statement of Financial Activities, the pension scheme liability in the balance sheet has fallen by £1.0 million since 2020/21. The pension liability and its impact on the hospice's financial position is monitored closely by the Hospice Trustees and also by the Trustees of the Federated Pension Scheme for the Douglas Macmillan Hospice.

OUR STRATEGIC VISION

The strategic priorities for Dougie Mac are cemented into our DMH@50 Strategic Plan which visualises the intended progress of the hospice as we look towards our 50[th] birthday in 2023. These are:

2021/22 has seen an increase in demand for all our clinical services and as we edge closer to our 50[th] year we anticipate demand to increase further. Our DMH@50 strategic plan has been refreshed to include the children’s hospice care and our young adult service, both of which will extend the reach and impact of Dougie Mac.

5

STRUCTURE AND GOVERNANCE

Board of Trustees

The Board of Trustees is the governing body that administers the charity, sets the strategy, formulates policy and assesses procedures and risk management. The Board meets regularly and the trustees are directors of the company but none of the trustees has a beneficial interest in the company and all are unpaid volunteers.

Trustee Recruitment, Appointment and Induction

The existing trustees of Douglas Macmillan Hospice are empowered under the Articles of Association to elect new trustees at our Annual General Meeting and to make co-options at any other time. Succession planning for trustees is an important dimension of governance as is a blend of skills in the Board of Trustees, so new trustees are recruited in a variety of ways including external advertising and previous interest in and involvement with the Hospice. Additionally potential new trustees are invited to attend Board meetings as an observer to assist them on deciding whether to agree to a nomination as a trustee. New trustees receive a full induction programme over an extended period, including briefings with senior executives and visits to the various parts of the organisation to gain an appreciation of the mosaic of aspects which contribute to the success of Douglas Macmillan Hospice.

Subcommittees of the Board of Trustees

To assist in the smooth running of the charity the Board is supported by seven subcommittees each of which meets at appropriately regular intervals and are chaired by a member of the Board. These subcommittees are:

The trustees on each subcommittee have relevant interests and skills to ensure that they enhance the work of that committee. A scheme of delegation is in place so that day to day responsibility for the affairs of the charity, including all operational matters, rests with the Chief Executive Officer and the Executive team, which currently comprises:

Both DMHSEL and DMHSLL develop commercial activities to support the charity and each covenants its surplus to the charity, and results are included within the Consolidated Financial Statements.

Risk Management

Governance of Douglas Macmillan Hospice is underpinned by a transparent culture of risk evaluation and risk management, enabling the Board of Trustees to consider all risks, both stated and emerging, and fulfil their responsibility for risks faced by the charity. A risk register identifies the potential and actual risks, their nature, likelihood and impact and then outlines the measures taken to mitigate those risks. Trustees review

6

the risk register formally at Board meetings as well as assessing and updating it at appropriate subcommittees. The main risks that the charity faces are:

a) Financial Sustainability

This is mitigated by our robust fundraising strategy; built over many years of successful expansions of donated income, and by cultivating excellent relationships with statutory funding partners in the local health economy.

b) Reputation

The Hospice is held in high regard by local people and stakeholder partners and has been so for 49 years but protecting and polishing our reputation requires mitigating actions, notably in ensuring that all our systems, processes and support lead to the successful recruitment retention and development of outstanding people.

c) Internal Infrastructure

In a rapidly changing environment our mitigations involves continually assessing and modifying our infrastructure (including I.T.) to contend with contemporary and future needs. Cost containment and investment in new assets are kept in balance by constant monitoring.

Reserves Policy

Reserves are held to ensure that the charity has the ability to withstand any unforeseen drops in income, and to provide capital for future strategic growth, recognising that access to external capital is very limited. The Board of Trustees is satisfied that the current level of reserves provides an adequate buffer against risks that cannot be negated by other means, whilst underpinning the strategic plan for the future of the hospice.

Remuneration Policy

The People & Values subcommittee, which reports to the Board of Trustees, oversees all matters relating to executive remunerations and staff pay and benefits. External benchmarks and local market rates of pay are used as comparatives so that the Hospice can attract and retain high quality staff in both clinical and nonclinical roles. An annual appraisal process is in place to evaluate job performance at an individual level across the organisation.

Disabled Persons Policy

In terms of employment, the Hospice gives full and fair consideration to applications for employment from disabled persons, it is also committed to becoming more disability confident ensuring that disabled people, and those with lifelong heath conditions, have the opportunities to fulfil their potential and realise their aspirations. We support the ongoing training and development of persons disabled prior to appointment or who become disabled following appointment.

Fundraising standards information

We maintain the highest standards of practice in fundraising activities by:

7

Trustees Responsibilities in Relation to Financial Statements

The charity’s trustees, who are also the directors of Douglas Macmillan Hospice for the purposes of company law, are responsible for preparing a trustees annual report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (UK generally accepted accounting practice).

Company law requires our trustees to prepare financial statements for each year which give a true and fair view of the state of affairs of the charitable company and the group, and of the incoming resources and applications of resources, including the income and expenditure of the charitable group for that period.

In preparing these financial statements, the trustees are required to:

The trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time, the financial position of the charity and to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and the group, and hence take 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 in the charity’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from that in other jurisdictions.

In so far as the trustees are aware at the time of approving our trustees’ report there is no relevant audit information of which our auditor is unaware, and trustees have taken all steps that they ought to have taken to make them aware of any relevant audit information. It is customary to place a resolution at our AGM proposing the appointment of Geens Ltd as our auditors and trustees will do so in the knowledge stated above.

Approved by the trustees on 26th September 2022 and signed on their behalf by:

David Platt Chairman of Board of Trustees

8

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DOUGLAS MACMILLAN HOSPICE

FOR THE YEAR ENDED 31 MARCH 2022

Opinion

We have audited the financial statements of Douglas Macmillan Hospice and its subsidiaries (the ‘group’) for the year ended 31 March 2022 which comprise the consolidated statement of financial activities, the consolidated balance sheet, the consolidated 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, 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 group and parent 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.

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:

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DOUGLAS MACMILLAN HOSPICE

FOR THE YEAR ENDED 31 MARCH 2022

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the group and parent charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors’ 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 8, 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 group’s and parent 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 group or the parent 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

We have been appointed auditor under the Companies Act 2006 and report in accordance with the Act and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above. To detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

As part of our planning process:

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DOUGLAS MACMILLAN HOSPICE

FOR THE YEAR ENDED 31 MARCH 2022

The key procedures we undertook to detect irregularities, including fraud, during the course of the audit included:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. The 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.

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 member’s trustees 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.

Karen Staley FCA (Senior Statutory Auditor) for and on behalf of Geens Limited

26[th] September 2022

Chartered Accountants Statutory Auditor

68 Liverpool Road Stoke on Trent Staffordshire ST4 1BG

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES (Including consolidated income and expenditure account) FOR THE YEAR ENDED 31 MARCH 2022

----- Start of picture text -----
Unrestricted Designated Restricted Total Total
funds funds funds funds funds
Notes £ £ £ £ £
Income: 2022 2021
Donations and legacies 2 1,663,467 5,820,992 45,742 7,530,201 3,335,330
Charitable activities 3 4,029,349 - 1,821,688 5,851,037 6,231,639
Other trading activities 4 6,584,059 - - 6,584,059 3,874,547
Investment income 5 104,028 - - 104,028 130,463
Other 6 319,615 - - 319,615 5,344,935
Total income 12,700,518 5,820,992 1,867,430 20,388,940 18,916,914
Expenditure
Costs of raising funds 7 3,245,511 - - 3,245,511 2,789,548
Charitable activities 8 9,240,952 512,830 1,821,688 11,575,470 8,855,735
Total expenditure 12,486,463 512,830 1,821,688 14,820,981 11,645,283
Net gains/ (loss) on investments 17 123,550 - - 123,550 1,397,069
Net income / (expenditure) 337,605 5,308,162 45,742 5,691,509 8,668,700
Transfers between funds 25/26 1,936,709 (1,936,709) - - -
Other recognised gains and (losses)
Actuarial gain / (loss) on defined benefit
pension schemes 21 902,000 - - 902,000 402,000
Net movement in funds 3,176,314 3,371,453 45,742 6,593,509 9,070,700
Reconciliation of funds:
Fund balances brought forward 7,196,029 14,013,267 45,003 21,254,299 12,183,599
Fund balances carried forward 10,372,343 17,384,720 90,745 27,847,808 21,254,299
----- End of picture text -----

All of the above results were derived from continuing operations. All gains and losses recognised in the year are included above.

The notes on pages 15 to 32 form an integral part of these financial statements.

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

CONSOLIDATED BALANCE SHEET

AS AT 31 MARCH 2022

Notes
Fixed assets
Tangible assets
16
Investments
17
Current assets
Stocks
18
Debtors
19
Cash at bank and in hand
Creditors: amounts falling due within one year
20
Net current assets
Total assets less current liabilities
being net assets excluding pension liability
Defined benefit pension scheme liability
21
Net assets including pension liability
Funds
Income funds
Restricted funds
25
Unrestricted funds:
Designated funds
26
Other charitable funds
Total funds excluding pension reserve
Pension reserve
21
Total funds		 2022
2021
2022
2021
£
£
£
£
9,001,074
9,246,326
9,001,074
9,246,326
9,153,108
7,050,197
9,153,112
7,050,201
18,154,182
16,296,523
18,154,186
16,296,527
4,588
3,074
-
-
3,441,324
2,911,641
3,971,211
3,428,406
8,199,130
4,765,320
7,322,106
3,920,226
11,645,042
7,680,035
11,293,317
7,348,632
(1,244,416)
(985,259)
(922,361)
(669,766)
10,400,626
6,694,776
10,370,956
6,678,866
28,554,808
22,991,299
28,525,142
22,975,393
(707,000)
(1,737,000)
(707,000)
(1,737,000)
27,847,808
21,254,299
27,818,142
21,238,393
90,745
45,003
90,745
45,003
17,384,720
14,013,267
17,384,720
14,013,267
11,079,343
8,933,029
11,049,677
8,917,123
28,554,808
22,991,299
28,525,142
22,975,393
(707,000)
(1,737,000)
(707,000)
(1,737,000)
27,847,808
21,254,299
27,818,142
21,238,393
Group
Charity

The financial statements were approved by the Board on 26[th] September 2022 and agreed on their behalf by:

Mr D Platt - Chairman

The notes on pages 15 to 32 form an integral part of these financial statements.

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 MARCH 2022

----- Start of picture text -----
Group Charity
2022 2021 2022 2021
Notes £ £ £ £
Net cash provided by operating activities 28 5,431,630 5,361,229 5,399,700 4,513,073
Cash flows from investing activities:
Dividends, interest and rents from investments 104,028 130,463 104,028 130,463
Purchase of property, plant and equipment (268,363) (4,172,629) (268,363) (4,172,629)
Proceeds from sale of property, plant and equipment - - - -
Proceeds on sale of investments (3,591,669) 2,989,060 (3,591,669) 2,989,060
Purchase of investments 1,758,184 (2,865,582) 1,758,184 (2,865,582)
Net cash used in investing activities (1,997,820) (3,918,688) (1,997,820) (3,918,688)
Change in cash and cash equivalents in the reporting period 3,433,810 1,442,541 3,401,880 594,385
Cash and cash equivalents at the beginning of the reporting period 4,765,320 3,322,779 3,920,226 3,325,841
Cash and cash equivalents at the end of the reporting period 8,199,130 4,765,320 7,322,106 3,920,226
----- End of picture text -----

The notes on pages 15 to 32 form an integral part of these financial statements.

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DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS

1b)

1c)

FOR THE YEAR ENDED 31 MARCH 2022

1 Accounting policies

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

1a) Basis of preparation

The financial statements have been prepared in accordance with the Charity's memorandum and articles of association, the Charities Act 2011 and the Companies Act 2006 and "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)". The Charity is a Public Benefit Entity as defined by FRS 102.

The financial statements are prepared on a going concern basis under the historical cost convention, modified to include certain items at fair value. The financial statements are prepared in sterling which is the functional currency of the charity and rounded to the nearest £1.

These group financial statements consolidate the results of the charity and its wholly owned subsidiary undertakings for the year ended 31 March 2022 on a line by line basis. The trading results of the subsidiary undertakings are shown in note 13.

A separate Statement of Financial Activities and Income and Expenditure Account for the charity has not been presented because the Charity has taken advantage of the exemption afforded by section 408 of the Companies Act 2006.

Fund accounting

Unrestricted funds are available for use, at the discretion of the trustees, in furtherance of the general objectives of the charity and which have been designated for other purposes:

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors, or which have been raised by the charity for particular purposes.

Income recognition

All income is included in the Statement of Financial Activities (SOFA) when the charity is legally entitled to the income after any performance conditions have been met, the amount can be measured reliably and it is probable that the income will be received.

For donations to be recognised the charity will have been notified of the amounts and the settlement date in writing. If there are conditions attached to the donation and this requires a level of performance before entitlement can be obtained then income is deferred until those conditions are fully met or the fulfilment of those conditions is within the control of the charity and it is probable that they will be fulfilled.

Donated facilities and donated professional services are recognised in income at their fair value when their economic benefit is probable, it can be measured reliably and the charity has control over the item. Fair value is determined on the basis of the value of the gift to the charity. For example the amount the charity would be willing to pay in the open market for such facilities and services. A corresponding amount is recognised in expenditure.

No amount is included in the financial statements for volunteer time in line with the SORP (FRS 102). Further detail is given in the Trustees’ Annual Report.

Gifts in kind donated for resale are included at fair value, being the expected proceeds from sale less the expected costs of sale. Where estimating the fair value is practicable upon receipt it is recognised in stock and ‘Income from other trading activities’. Upon sale, the value of the stock is charged against ‘Income from other trading activities’ and the proceeds are recognised as ‘Income from other trading activities’. Where it is impracticable to fair value the items due to the volume of low value items they are not recognised in the financial statements until they are sold. This income is recognised within ‘Income from other trading activities’.

Fixed asset gifts in kind are recognised in full when receivable and are included at fair value.

15

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

1d)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

1 Accounting policies (continued)

1c) Income recognition (Continued)

Legacies are recognised when both entitlement to receive the income has been established and when it is probable that the income will be received. Receipt is assessed to be probable when: there has been grant of probate; and the executors have established that there are sufficient assets in the estate, after settling any liabilities, to pay the legacy. Legacies are measured at the fair value of income receivable based on available information.

Income from trading activities includes income earned from fundraising events and trading activities to raise funds for the charity. Income is received in exchange for supplying goods and services in order to raise funds and is recognised when entitlement has occurred.

Investment income is earned through holding assets for investment purposes such as shares and property. It includes dividends, interest and rent. Where it is not practicable to identify investment management costs incurred within a scheme with reasonable accuracy the investment income is reported net of these costs. It is included when the amount can be measured reliably. Interest is recognised using the effective interest method and dividend and rent income is recognised as the charity’s right to receive payment is established.

Expenditure recognition

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Expenditure is recognised where there is a legal or constructive obligation to make payments to third parties, it is probable that the settlement will be required and the amount of the obligation can be measured reliably. It is categorised under the following headings:

Irrecoverable VAT is charged as an expense against the activity for which expenditure arose.

1e) Support costs allocation

Support costs are those that assist the work of the charity but do not directly represent charitable activities and include finance costs, governance costs, information technology costs, HR and reception costs, facilities and health and safety costs, nonattributable depreciation, and general overheads including the defined benefit pension scheme cost. They are incurred directly in support of expenditure on the objects of the charity. Where support costs cannot be directly attributed to particular headings they have been allocated to expenditure on charitable activities on an apportioned basis related to the expenditure as a percentage of total expenditure.

Fund-raising costs are those incurred in seeking voluntary contributions and do not include the costs of disseminating information in support of the charitable activities.

The analysis of these costs is included in note 9.

1f)

Tangible fixed assets and depreciation

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended.

16

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

1 Accounting policies (continued)

1f) Tangible fixed assets and depreciation (continued)

Depreciation is provided on all tangible fixed assets, at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its expected useful life as follows:

Freehold land is not depreciated Freehold buildings 3% p.a. straight line Retail leased buildings works 20% p.a. straight line Fixtures, fittings & equipment 25% p.a. straight line and reducing balance Motor vehicles 25% p.a. reducing balance

1g) Stock

Stock is stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the firstin, first-out formula. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Donated stocks are fair valued as described in section 1c) above.

1h) Financial instruments

The charitable company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the charitable company's balance sheet when the charitable company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

i) Financial assets

Basic financial assets, which include debtors, and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including short term highly liquid investments are initially measured at fair value, with subsequent changes in fair value recognised in the Statement of Financial Activities. These include cash on deposit and cash equivalents with a maturity of less than one year.

Investments in subsidiaries are measured at cost less impairment.

Financial assets measured at amortised cost are assessed for indicators of impairment at each reporting end date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the Statement of Financial Activities.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the charitable company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

ii) Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

17

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

1i) Provisions

1j)

1l)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

1 Accounting policies (continued)

1h) Financial instruments (continued)

Basic financial liabilities, including creditors and loans from fellow group companies that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Provisions are recognised when the charity has an obligation at the balance sheet date as a result of a past event, it is probable that an outflow of economic benefits will be required in settlement and the amount can be reliably estimated.

Leases

Assets acquired under finance leases are capitalised and depreciated over the shorter of the lease term and the expected useful life of the asset. Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding lease liability using the effective interest method. The related obligations, net of future finance charges, are included in creditors.

Rentals payable and receivable under operating leases are charged to the SOFA on a straight line basis over the period of the lease.

1k) Pensions

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

The charity operates a defined contribution plan for the benefit of its employees. Contributions are expensed as they become payable.

The charity also operates a defined benefit scheme which is closed to new members. The contributions made to the scheme are as recommended by the Scheme Trustees and the independent actuary. The regular cost of providing retirement pensions and related benefits is charged to the statement of financial activities over the employees' service lives on the basis of a constant percentage of earnings.

Tax

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

1m) Going concern

At the time of approving the financial statements the Trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the forseeable future and not less than one year from the date of approval. The Trustees and executive team are constantly monitoring the position of the charity and at the balance sheet date the charity has healthy reserves and healthy cash balances. Under all scenarios reviewed, the Hospice has sufficient reserves to enable it to continue as a going concern for the forseeable future. For this reason it continues to adopt the going concern basis in preparing the financial statements.

18

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

1n) Critical accounting judgements and key sources of estimation uncertainty

In the application of the charity's accounting policies, which are described above, the Trustee's 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 future and current periods.

In preparing these financial statemenbts, the Trustees have made judgements in determining the:

19

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

2
Donations and legacies
Unrestricted
Designated
Restricted
funds
funds
funds
£
£
£
Donations and gifts
1,609,779
1,915,000
45,742
Legacies
-
3,905,992
-
Department of Health
53,688
-
-		 Total
2022
£
3,570,521
3,905,992
53,688		 Total
2021
£
1,469,933
1,811,709
53,688
1,663,467
5,820,992
45,742		 7,530,201 3,335,330
For the year ended 31 March 2021
Unrestricted funds
Designated funds
Restricted funds		 1,521,966
1,811,709
1,655
3,335,330
3
Income from charitable activities
Unrestricted
Designated
Restricted
funds
funds
funds
£
£
£
Charitable activities
4,029,349
-
1,821,688		 Total
2022
£
5,851,037		 Total
2021
£
6,231,639
For the year ended 31 March 2021
Unrestricted funds
Designated funds
Restricted funds		 3,783,795
-
2,447,844
6,231,639
Included within income relating to charitable activities are:
Clinical Commissioning Group (Annual Grant)
NHS England COVID 19 (Via Hospice UK)
Wave 4 COVID 19 (Omicron) Support (CCG Funded)		 2,787,717
1,091,755
729,933		 2,973,635
2,447,844
-
4,609,405 5,421,479
4
Income from other trading activities
Unrestricted
Designated
Restricted
Total
Total
funds
funds
funds
2022
2021
£
£
£
£
£
Fundraising events
1,499,722
-
-
1,499,722
589,246
Income from commercial activities:
- Charity shops
3,621,315
-
-
3,621,315
1,939,340
- Lottery
1,463,022
-
-
1,463,022
1,345,961
NHS England awarded funding to allow the hospice to make available bed capacity and community support from December 2021 to
March 2022 to provide support to people with complex needs in the context of the COVID-19 situation.
6,584,059
-
-		 6,584,059 3,874,547
For the year ended 31 March 2021
Unrestricted funds
Designated funds
Restricted funds		 3,874,547
-
-
3,874,547
Included within income related to Charity shops are:
COVID 19 related Local Authority Retail Grants
Job Retention Scheme Grant		 -
-		 503,233
530,821
- 1,034,054

20

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

8

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

5
Investment income
Income from listed investments
Interest receivable
For the year ended 31 March 2021
Unrestricted funds
Designated funds
Restricted funds
6
Other
Transfer of assets from The Donna Louise Trust		 2022
2021
£
£
96,384
123,145
7,644
7,318
104,028
130,463
130,463
-
-
130,463
2022
2021
£
£
319,615
5,344,935

In March 2021 the services of The Donna Louise Trust, a local children and young adult hospice, were integrated in to the Douglas Macmillan Hospice. In connection with the integration of services assets with a value of £319,615 (2021 - £5,344,935) were transferred from The Donna Louise Trust to Douglas Macmillan Hospice. The assets transferred were comprised as follows:

Land and buildings
Other debtors
Cash at bank and in hand
Analysis of costs of raising funds
Fundraising Costs
Costs of commercial activities:
- Charity shops
- Lottery
For the year ended 31 March 2021
Unrestricted funds
Designated funds
Restricted funds		 -
4,106,868
319,615
301,453
-
936,614
319,615
5,344,935
Direct
Support
Total
Total
costs
costs
2022
2021
£
£
£
£
417,207
-
417,207
354,250
2,308,168
-
2,308,168
1,955,710
520,136
-
520,136
479,588
3,245,511
-
3,245,511
2,789,548
2,789,548
-
-
2,789,548

7 Analysis of costs of raising funds

Analysis of expenditure on charitable activities

Inpatient Services
Medical
Day Hospice
Community and Hospice at Home
Wellbeing
Learning and Development
Children and Young Adult Hospice
Unrestricted funds
Designated funds
Restricted funds		 Direct
Support
Total
Total
costs
costs
2022
2021
£
£
£
£
2,507,666
1,212,021
3,719,687
3,544,987
513,298
261,746
775,044
553,802
-
-
-
440,937
2,055,250
1,025,847
3,081,097
3,284,856
626,835
311,767
938,602
827,468
92,371
33,201
125,572
120,883
1,982,340
953,128
2,935,468
82,802
7,777,760
3,797,710
11,575,470
8,855,735
9,240,952
5,998,361
512,830
409,530
1,821,688
2,447,844
11,575,470
8,855,735

21

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

10

11

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

9 Allocation of support costs

Governance
Finance
Information technology
HR & reception
Facilities & health and safety
Depreciation
General overheads
Defined benefit pension scheme
Allocation of support costs (Continued)
Governance
Finance
Information technology
HR & reception
Facilities & health and safety
Depreciation
General overheads
Defined benefit pension scheme		 Community
Inpatient
and Hospice
Services
Medical
at Home
Wellbeing
£
£
£
£
40,097
8,519
33,604
10,224
135,215
29,560
115,300
35,013
206,335
43,765
172,749
52,563
225,228
48,143
189,450
57,615
221,491
48,174
188,280
57,193
164,794
34,337
136,502
41,583
158,306
35,725
137,648
41,712
60,555
13,523
52,314
15,864
1,212,021
261,746
1,025,847
311,767
Children and
Learning &
Young Adult
Total
Development
Hospice
2022
£
£
£
1,216
31,584
125,244
3,403
106,201
424,692
6,318
162,551
644,281
6,586
177,300
704,322
5,782
174,055
694,975
5,563
130,050
512,829
3,048
123,930
500,369
1,285
47,457
190,998
33,201
953,128
3,797,710

Support costs are allocated in proportion to total expenditure. Salary, wages and related costs are allocated to the charitable activities undertaken on the basis of the direct salary, wages and related costs incurred by each charitable activities. Other nonsalary support costs are allocated to the charitable activities undertaken on the basis of the total salary costs and direct costs incurred by each charitable activity.

Analysis of governance costs
Salaries, wages and related costs
Allocated on time basis
Audit fees (parent company)
Cost incurred
Premises costs
1.125% of total premises costs
Overheads
10% of overheads not included above
Net income / (expenditure) for the year
Net income / (expenditure) is stated after charging:
Depreciation
Loss on disposal of tangible fixed assets
Auditors' remuneration (group) - audit services
Auditors' remuneration (group) - non audit services
Operating lease charges - buildings		 2022
2021
£
£
34,584
32,453
9,500
9,250
19,016
19,276
62,144
34,789
125,244
95,768
2022
2021
£
£
512,830
409,530
786
-
15,400
14,700
7,714
6,025
302,792
264,096

22

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

12
Financial activities of the charity
Gross income
Total expenditure on charitable activities
Fundraising costs
Unrealised gains/ (losses) on investment assets		 2022
2021
£
£
19,835,575
18,442,604
(11,163,865)
(8,960,735)
(3,245,511)
(2,305,250)
123,550
1,397,069
Net income/ (expenditure)
Total funds brought forward excluding pension reserve		 5,549,749
8,573,688
22,975,393
14,401,705
Total funds carried forward excluding pension reserve 28,525,142
22,975,393
Represented by:
Unrestricted income funds
Designated income funds
Restricted income funds		 11,049,677
8,917,123
17,384,720
14,013,267
90,745
45,003
28,525,142
22,975,393
13
Trading subsidiaries
Name of subsidiary
Douglas Macmillan Hospice Staffordshire Lotteries Limited
Douglas Macmillan Hospice Staffordshire Enterprises Limited
Summary of trading results
2022
2021
£
£
Turnover
49,136
20,617
Total expenditure
(19,470)
(4,710)
England & Wales
Douglas Macmillan Hospice Staffordshire Enterprises Limited
England & Wales
100
% of equity share capital held
The charity controls the companies listed below by virtue of holding a controlling interest in the equity share capital:-
Country of incorporation
100
Profit for the year 29,666
15,907
The turnover from this entity is consolidated within total charity shop income reported in note 4 of these accounts.
All profits in this subsidiary are distributed to Douglas Macmillan Hospice after the year end.
The assets and liabilities of the Douglas Macmillan Hospice Staffordshire Enterprises Limited were:
Assets
35,222
133,356
Liabilities
(5,554)
(117,447)
Funds 29,668
15,909
Douglas Macmillan Hospice Staffordshire Lotteries Limited
Summary of trading results
Turnover
Other income
Total expenditure		 2022
2021
£
£
1,463,022
1,345,961
-
28,404
(520,136)
(479,588)
Profit for the year 942,886
894,777
The assets and liabilities of the Douglas Macmillan Hospice Staffordshire Lotteries Limited were:
Assets
Liabilities		 1,263,117
1,207,829
(320,229)
(313,050)
Funds 942,888
894,779

23

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

14 Analysis of staff costs, trustee remuneration and expenses, and the cost of key management personnel

The total staff costs and employees benefits were:

The total staff costs and employees benefits were:
Wages and salaries
Social security costs
Pension costs		 2022
2021
£
£
9,286,573
7,382,237
796,099
640,031
1,225,905
991,141
11,308,577
9,013,409
2022
2021
Number
Number
£60,001 to £70,000
2
1
£70,001 to £80,000
1
1
£80,001 to £90,000
-
-
£90,001 to £100,000
-
1
£100,001 to £110,000
2
1
The number of employees who received total employee benefits (excluding employer pension costs) of more than £60,000 is as
follows:

The average monthly number of employees and full time equivalent (FTE) during the year was as follows:

Raising funds
Charitable activities
Governance		 2022
2022
2021
2021
Number
FTE
Number
FTE
109
94
99
86
291
242
239
200
1
1
1
1
401
337
339
287

The key management personnel of the charity comprise the members of its executive management team. The total employee benefits of the key management personnel of the charity were £538,455 (2021: £507,683).

The trustees neither received nor waived any remuneration during the year (2021:£Nil).

The trustees did not have any expenses reimbursed during the year (2021:£Nil).

The charity has received no donations with conditions from the trustees during the year (2021:£Nil).

24

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

15 Pension costs FPS defined benefit scheme

The charity contributes to a defined benefit scheme and the details are in note 21.

Contributions are made in accordance with the annual recommendations of a qualified independent actuary.

The contributions to this scheme in the year were £Nil (2021: £Nil). Also during the year shortfall payments in respect of a recovery plan have been paid totalling £190,998 (2021: £154,671).

Contributions are also made to a second plan (FPS Federated Flexiplan) in accordance with actuarial recommendations.

NHS defined benefit scheme

The charity also contributes to the NHS Pension Scheme, which is an unfunded, defined benefit scheme that covers NHS employers, General Practices and other bodies, allowed under the direction of the Secretary of State, in England and Wales. The scheme is not designed to be run in a way that would enable NHS bodies to identify their share of the underlying scheme assets and liabilities. Therefore, the scheme is accounted for as if it were a defined contribution scheme: the cost to the NHS body of participating in the scheme is taken as equal to the contributions payable to the scheme for the accounting period.

A valuation of scheme liability is carried out annually by the scheme actuary (currently the Government Actuary’s Department) as at the end of the reporting period. This utilises an actuarial assessment for the previous accounting period in conjunction with updated membership and financial data for the current reporting period, and are accepted as providing suitably robust figures for financial reporting purposes. The valuation of scheme liability as at 31 March 2022, is based on valuation data as At 31 March 2021, updated to 31 March 2022 with summary global member and accounting data. In undertaking this actuarial assessment, the methodology prescribed in IAS 19, relevant FReM interpretations, and the discount rate prescribed by HM Treasury have also been used.

The contributions to this scheme in the year were £291,175 (2021: £249,421).

Aviva/Nest defined contribution schemes

The charity also contributes to defined contribution schemes in respect of employees who do not qualify for the FPS scheme or the NHS scheme.

The contributions to these schemes in the year were £739,257 (2021: £583,649).

25

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

16
Tangible fixed assets
Group and company
Cost
At 1 April 2021
Additions
Disposals
At 31 March 2022
Depreciation
At 1 April 2021
Charge for the year
Disposals
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021
17
Fixed asset investments
Market value at 1 April 2021
Additional funds invested
Additions at cost
Disposals at carrying value
Change in value in the year
Other movement in cash balance
Market value at 31 March 2022
Historical cost at 31 March 2022		 Land and
Fixtures,
Total
buildings
fittings &
equipment
£
£
£
12,553,250
1,585,718
14,138,968
59,463
208,900
268,363
-
(64,393)
(64,393)
12,612,713
1,730,225
14,342,938
3,586,745
1,305,897
4,892,642
389,801
123,029
512,830
-
(63,608)
(63,608)
3,976,546
1,365,318
5,341,864
8,636,167
364,907
9,001,074
8,966,505
279,821
9,246,326
Cash
Listed
Total
2021
inv.
£
£
£
£
215,735
6,834,462
7,050,197
5,689,104
2,000,000
-
2,000,000
-
1,758,184
(1,758,184)
-
-
(3,591,669)
3,591,669
-
-
-
123,550
123,550
1,397,069
(20,639)
-
(20,639)
(35,976)
361,611
8,791,497
9,153,108
7,050,197
361,611
8,067,184
8,428,795
6,327,198
Maitland Institutional Services MI select Managers Fund UK
Maitland Institutional Services MI select Managers Fund North America
Vanguard Funds PLC S&P 500
The following investments made up more than 5% each of the total market value of listed investments		 2022
2021
£
£
551,281
373,648
1,151,723
623,670
845,350
541,819
or bonds at 31 March 2022.
Summary of Investments
2022
2021
£
£
Investment in subsidiary companies
-
-
Other investments
9,153,108
7,050,197
Group		 2022
2021
£
£
4
4
9,153,108
7,050,197
Charity
9,153,108
7,050,197		 9,153,112
7,050,201

26

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

----- Start of picture text -----
18 Stock Group Charity
2022 2021 2022 2021
£ £ £ £
Stock in hand 4,588 3,074 - -
- -
4,588 3,074
19 Debtors Group Charity
2022 2021 2022 2021
£ £ £ £
Trade debtors 244,663 358,682 244,663 358,682
- -
Amounts owed by subsidiary undertakings 733,810 516,765
Other debtors 2,916,184 2,547,898 2,712,261 2,547,898
Prepayments and accrued income 280,477 5,061 280,477 5,061
3,441,324 2,911,641 3,971,211 3,428,406
20 Creditors: amounts falling due within one year Group Charity
2022 2021 2022 2021
£ £ £ £
Trade creditors 294,822 10,240 292,184 -
Amounts owed to subsidiary undertakings - - - -
Other creditors 462,298 590,611 153,300 292,163
Taxes and social security 212,522 166,797 212,522 166,797
Accruals and deferred income 274,774 217,611 264,355 210,806
1,244,416 985,259 922,361 669,766
21 Pension and other post-retirement benefit commitments
Employee benefit obligations Defined benefit pension plans
2022 2021
a) The amounts recognised in the balance sheet are as follows: £ £
Present value of funded obligations 10,090,000 11,497,000
Fair value of plan assets (9,383,000) (9,760,000)
Deficit 707,000 1,737,000
Present value of unfunded obligations - -
Unrecognised past service cost - -
Irrecoverable surplus - -
Net pension liability recognised before tax 707,000 1,737,000
b) The amounts recognised in the statement of financial activities are as follows:
Current service cost included in staff costs within total resources expended - -
Past service cost 25,000 -
25,000 -
Net pension finance costs included within total resources expended:
Interest on obligation 224,000 244,000
Expected return on pension scheme assets (190,000) (194,000)
34,000 50,000
Total 59,000 50,000
Actual return on scheme assets over the period 575,000 1,487,000
----- End of picture text -----

27

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

21
Pension and other post-retirement benefit commitments (continued)
c) Included with other recognised gains and losses:
Return on assets, excluding interest income
Impact of surplus restrictions
Change in irrecoverable surplus
Actuarial gains/(losses) on liabilities
d) Changes in the present value of the scheme liabilities:
Opening liabilities
Current service cost
Past service cost
Interest cost
Contribution by scheme participants
Actuarial (gains) / Losses
Benefits paid (including payments to and on account of leavers)
e) Changes in fair value of the scheme assets:
Opening fair value of scheme assets
Interest income
Actuarial gains
Contributions by employer
Contributions from scheme participants
Benefits paid (including payments to and on account of leavers)
f) The major categories of scheme assets are as follows:
Equity
Bonds
Diversified funds
LDI
Cash
Annuity contracts
g) Principal actuarial assumptions used by the actuary at the balance sheet date
Discount rate at 31 March
Rate of inflation (RPI)
Rate of inflation (CPI)
Rate of salary increase
Rate of increase to pensions in payment
- Pre 1997 (Discretionary)
- 1997 - 2009 (RPI max 5%)
- Post 2009 (RPI max 2.5%)		 2022
2021
£
£
385,000
1,293,000
-
-
-
-
517,000
(891,000)
902,000
402,000
2022
2021
£
£
11,497,000
10,841,000
-
-
25,000
-
224,000
244,000
-
-
(517,000)
891,000
(1,139,000)
(479,000)
10,090,000
11,497,000
£
£
9,760,000
8,597,000
190,000
194,000
385,000
1,293,000
187,000
155,000
-
-
(1,139,000)
(479,000)
9,383,000
9,760,000
2022
2021
£
£
3,350,000
3,535,000
1,391,000
1,523,000
3,447,000
3,658,000
1,146,000
984,000
34,000
43,000
15,000
17,000
9,383,000
9,760,000
2022
2021
%
%
2.70
2.05
3.90
3.35
3.50
2.95
2.50
2.50
0.00
0.00
3.70
3.25
2.35
2.20

28

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

21 Pension and other post-retirement benefit commitments (continued)

g) Principal actuarial assumptions used by the actuary at the balance sheet date (continued)

----- Start of picture text -----
|||| |---|---|---| |Expected life expectancies on retirement at age 65 are:|2022|2021| |Years|Years| |Males retiring immediately|20.00|19.90| |Females retiring immediately|23.30|23.20| |Males retiring in 20 years time|21.70|21.80| |Females retiring in 20 years time|25.20|25.10|

----- End of picture text -----

22 Financial commitments

Commitments under operating leases

As at 31 March 2022 the group was committed to making the following payments under non-cancellable operating leases as set out below:

23

----- Start of picture text -----
|||||| |---|---|---|---|---| |2022|2022|2021|2021| |Land &|Land &| |buildings|Other|buildings|Other| |Group:|£|£|£|£| |Operating leases which expire:| |Within one year|261,283|44,371|281,694|49,733| |Between two and five years|231,667|28,938|311,075|92,377| |After five years|-|-|16,667|-| |492,950|73,309|609,436|142,110| |2022|2022|2021|2021| |Land &|Land &| |buildings|Other|buildings|Other| |Company:|£|£|£|£| |Operating leases which expire:| |Within one year|232,908|44,371|261,819|49,733| |Between two and five years|227,125|28,938|300,575|92,377| |After five years|16,667|-|16,667|-| |476,700|73,309|579,061|142,110| |Capital commitments|Group and|Group and| |Company|Company| |2022|2021| |£|£| |-|-| |Contracted, not provided for| |-|-|

----- End of picture text -----

24 Company limited by guarantee

Douglas Macmillan Hospice is a company limited by guarantee and accordingly does not have share capital. Every member of the company undertakes to contribute such amount as may be required not exceeding £10 to the assets of the charitable company in the event of its being wound up while he or she is a member, or within one year after he or she ceases to be a member.

29

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

25 Restricted funds

The income funds of the charity include restricted funds comprising the following unexpended balances of donations and grants held for specific purposes:

NHS England
Other specific purposes		 Balances at
Incoming
Resources
Balances at
1 April 2021
resources
expended
Transfers
31 March 2022
£
£
£
£
£
-
1,821,688
(1,821,688)
-
-
45,003
45,742
-
-
90,745
45,003
1,867,430
(1,821,688)
-
90,745
Movement in funds

Purposes of the funds

NHS England awarded funding to allow the hospice to make available bed capacity and community support from December 2021 to March 2022 to provide support to people with complex needs in the context of the COVID-19 situation.

Specific purposes represents various donations made where the donors have asked that the monies be utilised to fund a specific aspect of the hospice's activities or to purchase particular items of equipment.

26 Designated funds

The income funds of the charity includes the following designated funds which have been set aside out of unrestricted funds by the trustees for specific purposes:

Fixed assets fund
Legacy equalisation fund
Young adult hospice fund		 Balances at
Incoming
Resources
Balances at
1 April 2021
resources
expended
Transfers
31 March 2022
£
£
£
£
9,246,326
-
(512,830)
267,578
9,001,074
4,766,941
3,905,992
-
(2,204,287)
6,468,646
-
1,915,000
-
-
1,915,000
14,013,267
5,820,992
(512,830)
(1,936,709)
17,384,720
Movement in funds

The fixed assets fund has been set up to assist in identifying those funds that are not free funds and it represents the net book value of all assets.

The legacy equalisation fund has been designated by the trustees to provide for expenditure in future years. The trustees recognise the unpredictable nature of this source of income and have set aside funds to provide for expenditure not covered by income from other sources.

The young adult hospice fund relates to a donation from the Denise Coates Foundation towards the on-going running costs of the young adults' hospice.

The transfer to the fixed asset fund is in respect of fixed asset additions in the year now designated by the trustees as part of the fixed asset fund and also fixed assets transferred from restricted funds.

The transfer from the legacy fund is to reflect the amount transferred to unrestricted income previously designated by the trustees. The amount is calculated on the multi year average of legacy income.

30

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

29

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

27 Analysis of group net assets between funds

Fund balances at 31 March 2022 are represented by:
Tangible fixed assets
Investments
Current assets
Current liabilities
Pension reserve
Group net assets		 Unrestricted
Designated
Restricted
Total
funds
funds
funds
£
£
£
£
-
9,001,074
-
9,001,074
9,153,108
-
9,153,108
3,170,651
8,383,646
90,745
11,645,042
(1,244,416)
-
-
(1,244,416)
11,079,343
17,384,720
90,745
28,554,808
(707,000)
-
-
(707,000)
10,372,343
17,384,720
90,745
27,847,808

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

Net income for the reporting period
Adjustments for:
Depreciation charges
Loss on disposal of tangible fixed assets
Increase in investment cash balance
Gains on investments
Actuarial gains
Dividends, interest and rents from investments
Difference between pension charge and cash contributions
(Increase)/ decrease in stocks
(Increase)/ decrease in debtors
Increase/ (decrease) in creditors
Net cash provided by operating activities
Analysis of net cash balances
Cash at bank and in hand
Fixed asset investments		 2022
2021
2022
2021
£
£
£
£
6,593,509
9,070,700
6,579,748
9,080,688
512,830
409,530
512,830
409,530
786
-
786
-
(145,876)
(87,502)
(145,876)
(87,502)
(123,550)
(1,397,069)
(123,550)
(1,397,069)
(902,000)
(402,000)
(902,000)
(402,000)
(104,028)
(130,463)
(104,028)
(130,463)
(128,000)
(105,000)
(128,000)
(105,000)
(1,514)
2,147
-
-
(529,684)
(1,787,858)
(542,805)
(2,304,623)
259,157
(211,256)
252,595
(550,488)
5,431,630
5,361,229
5,399,700
4,513,073
1 April
Cash flow
Non-cash
31 March
2021
changes
2022
£
£
£
£
4,765,320
3,433,810
-
8,199,130
7,050,197
1,979,361
123,550
9,153,108
11,815,517
5,413,171
123,550
17,352,238
Group
Charity

31

DOUGLAS MACMILLAN HOSPICE (A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2022

30 Financial instruments

The carrying amounts of the charity's financial instruments are as follows:

Notes
Financial assets
Measured at fair value through net income / expenditure:
Fixed asset listed investments
17
Debt instruments measured at amortised cost:
Trade debtors
19
Amounts owed by subsidiary undertakings
19
Other debtors
19
Financial liabilities
Measured at amortised cost
Trade creditors
20
Amounts owed to subsidiary undertakings
20
Other creditors
20
Taxes and social security
20
Accruals and deferred income
20		 2022
2021
2022
2021
£
£
£
£
9,153,108
7,050,197
9,153,112
7,050,201
244,663
358,682
244,663
358,682
-
733,810
516,765
2,916,184
2,547,898
2,712,261
2,547,898
3,160,847
2,906,580
3,690,734
3,423,345
294,822
10,240
292,184
-
-
-
-
-
462,298
590,611
153,300
292,163
212,522
166,797
212,522
166,797
274,774
217,611
264,355
210,806
1,244,416
985,259
922,361
669,766
Group
Charity

The income, expenses, net gains and net losses attributable to the charity's financial instruments are summarised as follows:

Notes
17
Financial assets measured at fair value through
net income / expenditure		 2022
2021
2022
2021
£
£
£
£
123,550
1,397,069
123,550
1,397,069
Charity
Group

31 Funds held on behalf of third Parties

Douglas Macmillan Hospice is providing administrative services to Symptom Control in Palliative Care. As part of this service Douglas Macmillan Hospice receives an administration fee.

Neither income nor the expenditure (with the exception of the administrative fee income) has been accounted for in the Statement of Financial Activities. Balances held in these bank accounts at the year end do not form part of the charity's assets and are not included in the balance sheet.

32 Related party transactions

There were no related party transactions during the year (2021: £Nil).

32