**REGISTERED COMPANY NUMBER: 03613056 (England and Wales) REGISTERED CHARITY NUMBER: 1071974** **REPORT OF THE TRUSTEES AND AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021** ## **FOR ENGINEERS AGAINST POVERTY** Magma Audit LLP Magma House 16 Davy Court Castle Mound Way Rugby CV23 0UZ **ENGINEERS AGAINST POVERTY** **CONTENTS OF THE FINANCIAL STATEMENTS for the year ended 31 December 2021** |||**Page**|| |---|---|---|---| |**Report of the Trustees**|1|to|5| |**Report of the Independent Auditors**|6|to|7| |**Statement of Financial Activities**||8|| |**Statement of Financial Position**||9|| |**Statement of Cash Flows**||10|| |**Notes to the Statement of Cash Flows**||11|| |**Notes to the Financial Statements**|12|to|19| |**Detailed Statement of Financial Activities**|20|to|21| **ENGINEERS AGAINST POVERTY** **REPORT OF THE TRUSTEES for the year ended 31 December 2021** The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31 December 2021. The trustees have adopted the provisions of Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019). ## **STRUCTURE, GOVERNANCE AND MANAGEMENT** ## **Governing document** The charity is controlled by its governing document, a deed of trust, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006. ## **REFERENCE AND ADMINISTRATIVE DETAILS Registered Company number** 03613056 (England and Wales) **Registered Charity number** 1071974 ## **Registered office** 6th Floor Alliance House 29-30 High Holborn London WC1V 6AZ ## **Trustees** Professor P Jowitt Chair J Downham Treasurer J Hodges A Marshall (resigned 27 January 2022) R Watermeyer Professor G Ofori Dr P Parikh Rupert Sydenham (appointed 27 January 2022) **Company Secretary** S Henderson **Auditors** Magma Audit LLP Magma House 16 Davy Court Castle Mound Way Rugby CV23 0UZ **Bankers** National Westminster Bank Plc PO Box 113, Cavell House 2a Charing Cross Road London WC2H 0NN ## **EVENTS SINCE THE END OF THE YEAR** Information relating to events since the end of the year is given in the notes to the financial statements. Page 1 **ENGINEERS AGAINST POVERTY** **REPORT OF THE TRUSTEES for the year ended 31 December 2021** ## **REFERENCE AND ADMINISTRATIVE DETAILS** The following people were employed by EAP during 2021 and up to the date of the report: Petter Matthews - Executive Director John Hawkins - Head of Programmes Sean Henderson- Senior Finance & Administration Officer Charlotte Broyd-Communications Manager Resigned 24 February 2022 Maria Prado - Senior Policy & Advocacy Adviser Tippi Creed Waring - Communications Officer Resigned 19 November 2021 Nora Pesheva - Office Administrator Resigned 13 May 2021 Amanda Oduka - Programme Manager Resigned 9 March 2021 Lauren Nelson-Pemberton - Communications Manager Appointed 30 May 2022 ## **FINANCIAL INSTRUMENTS** The principal financial instruments of the charity comprise bank balances, other receivables and other payables. The main purpose of these instruments is to raise funds for the charity's operations and to finance its continuing operations. Liquidity risk is managed by the use of a bank balance along with efficient monitoring of cash flows to ensure there are sufficient funds to meet liabilities. ## **Management of major risks** The trustees retain responsibility for a system of internal control that is designed to manage major risks. These systems provide reasonable but not absolute assurance against inappropriate or ineffective use of resources and against the risk of errors or fraud. The trustees delegate authority to the Executive Director to conduct regular reviews of the major strategic and operational risks that Engineers Against Poverty (EAP) faces and the ways in which they are being monitored, managed and mitigated. The outcomes of this review are reported to the trustees by the Executive Director and changes in policy are made where necessary. The trustees are satisfied with the systems in place to monitor, manage and mitigate EAP's exposure to major risks. ## **OBJECTIVES AND ACTIVITIES** ## **Objects** The objects of the Charity are for the relief of poverty in particular by assisting in the provision of engineering support for projects and programmes for the relief of poverty anywhere in the world. ## **Our approach** Our goal is to scale-up our influence on global infrastructure policy and practice to promote sustainable social, climate and economic impacts that contribute towards the elimination of poverty. Our goal is centred around three areas of work, to: - Improve infrastructure governance and public investment management through increased transparency, participation and accountability - Foster social equity and inclusive growth through fair opportunities for local enterprises as well as decent jobs and working conditions - Mitigate the impact of climate change on the poor and vulnerable through sustainable and resilient infrastructure ## **How we achieve our goal** We achieve our goal by producing innovative knowledge products. For the most part these are concise policy and practice briefings which draw on our existing and new research and provide evidence, analysis and policy and/or practice recommendations. Our knowledge products are core to our advocacy strategy which sees that we act as a trusted adviser to governments, international institutions, the private sector and civil society and that we facilitate multi-stakeholder partnerships to build capacity in the sector. ## **Policies** The trustees are responsible for establishing the policies that guide the work of the Charity. These policies are designed to make the most effective and efficient use of the resources at its disposal. They are also designed to ensure that EAP meets its obligations to its project partners, corporate and individual supporters and staff. Responsibility for implementing these policies on a day-to-day basis is delegated to the Executive Director who reports to the trustees on a regular basis. ## **Restrictions** There are no restrictions in the governing documents as to how Engineers Against Poverty may operate. Page 2 **ENGINEERS AGAINST POVERTY** **REPORT OF THE TRUSTEES for the year ended 31 December 2021** ## **Investment Powers** There are no powers to make investments other than in bank accounts and there is no intention to build up an investment fund. ## **Charitable Contributions** All programme expenditure is for charitable purposes, but no direct contributions for charitable purposes have been made. ## **PUBLIC BENEFIT** The trustees have noted the duty in section 4 of the Charities Act 2006 and the guidance of the Charity Commission with regard to public benefit. All our activities are for the public benefit, but we highlight in particular: Our promotion of transparency and accountability in infrastructure investment benefits a broad section of the public. The benefits are realised through obtaining better value from public investment and delivering better quality infrastructure and services. All those who pay taxes and use public services are likely to benefit. Our policy work directly influences high-level decision makers in governments and international agencies. Because of our advice public policy is more closely aligned with the needs of poor and marginalised people. Our capacity building support strengthens institutions and empowers individuals. Institutions become more effective and individuals are better able to secure their rights and realise their potential. Our outreach work informs and empowers people. It provides practical solutions to the problems of poverty aimed at policy makers and practitioners. It also provides data that is useful to researchers and can contribute to better public policy. ## **ACHIEVEMENTS AND PERFORMANCES** ## **EAP Insights** EAP released the second and final instalments of its Mega Sport Event (MSE) Insights series looking at the key issues in infrastructure delivered for the events. The second paper looked at the impact of corruption in MSE infrastructure, why it is particularly common in MSEs and what to do about it. The third publication homed in on accountability in the events, with its recommendations calling for public participation right from the outset of MSEs, such as when cities bid for the events. The papers received positive coverage across the media and a piece on the series was featured and selected as a top editor highlight in the magazine, Construction Today. ## **African Catalyst** EAP continued to support engineering bodies in Rwanda, Nigeria and Uganda to strengthen local engineering capacity as part of the Royal Academy of Engineering's Africa Catalyst programme. A core part of this work is centred on improving the opportunities of engineering graduates through internship placements. Our evaluation of the programme over the past year showed positive results. - 100% of the interns interviewed for the evaluation reported with confidence that both their soft and technical skills had increased. These skills ranged from operations and handling to accurately plotting boundaries to leadership and supervision. - 100% of the interns reported that their level of confidence to perform a specific task had increased. - - 100% of the interns reported that their potential for employment had increased as a result of the project and many started applying for jobs soon after the placements. ## **Influencing** In 2021 we continued to facilitate discussion and generate debate on key infrastructure issues. Key moments included: - Bringing together influential thinkers and leaders at the OECD Anti-Corruption and Integrity Forum in March. Here we discussed the role of technology and innovative approaches in financing to help build infrastructure back better. - We investigated the transparency of UK infrastructure, looking to transport, roads and health projects delivered for Covid-19 and finding a concerning lack of transparency. We took part in the UK Government consultation on its 'Transforming Public Procurement' paper, highlighting the need to focus more heavily on infrastructure procurement. - We published opinion pieces, featuring the voice of our staff, board and external experts for World Engineering Day, COP26 and UNESCO events. Page 3 **ENGINEERS AGAINST POVERTY** **REPORT OF THE TRUSTEES for the year ended 31 December 2021** ## **CoST - the Infrastructure Transparency Initiative** EAP continued to host the International Secretariat of CoST - the Infrastructure Transparency Initiative (CoST). CoST works with 20 members worldwide and is one of the leading global organisations working to improve transparency, participation and accountability in infrastructure. A selection of its successes in 2021 are below. ## **CoST member achievements** - By the end of 2020, CoST supported the publication of data on 19,076 projects in line with the CoST Infrastructure Data Standard (CoST IDS), bringing the accumulative total to an impressive 76,767 projects globally. - Despite the restrictions imposed by Covid-19, CoST members used innovative methods to train over 6848 government, civil society and private sector stakeholders on disclosing and using infrastructure data. - CoST Uganda held impactful community events to highlight water project management issues affecting farmers. This led to a commitment from local decision makers to improve the projects and extend the water supply to more farmers so they too can benefit. Other members such as Afghanistan and Guatemala have been raising awareness on water infrastructure projects to help mitigate the impact of climate change. - New members Dominican Republic and Bogota (Colombia) joined the initiative with bold commitments to improve infrastructure in their contexts. - Members continue to innovative and include marginalised representatives in their public participation activity, with member outreach now extending to more indigenous groups, youth and females. ## **CoST International Secretariat achievements** - The CoST IS delivered a robust guidance package to help members and others achieve greater impact across the core features of CoST, to address pressing global issues and stay on top of new trends. This included guidance on a more gender-inclusive approach, how to apply CoST in crisis settings and how to use key technology to catalyse results. - CoST shared key lessons from its work improving public-private partnership (PPP) projects. This reflects on the impact seen from heightening PPP transparency in Honduras which led to institutional change and the cancellation of a project set to bankrupt the country. - The secretariat continued to influence global debate on infrastructure issues by organising key events, including at the C20 Summit, US Summit for Democracy and the Open Government Partnership Summit. ## **Support of organisations** The work of EAP would not have been possible without the tremendous support of a range of organisations including: CoST - the Infrastructure Transparency Initiative FIDIC International Federation of Consulting Engineers Foreign Commonwealth and Development Office Hogan Lovells Institution of Chemical Engineers Institution of Engineers Rwanda London Southbank University Nigerian Institution of Mechanical Engineers Royal Academy of Engineering Transparency International Australia Uganda Institution of Professional Engineers. ## **Support of individuals** The trustees express their sincere gratitude to all the individuals who have supported the Charity's work in 2021 but are too numerous to mention here. ## **FINANCIAL REVIEW** ## **Accounts** The accounts for the year ended 31 December 2021 are shown in this annual report. The trustees consider that the reserves are sufficient to meet its needs and obligations. All funds are held on short term deposit. ## **Unrestricted Fund** The balance of unrestricted funds at 31 December 2021 was £464,983 (2020: £558,881) . Page 4 **ENGINEERS AGAINST POVERTY** **REPORT OF THE TRUSTEES for the year ended 31 December 2021** ## **Reserves** The trustees have established a Reserves Policy that considers the level of reserves sufficient to protect the organisation and its charitable programme by providing time to adjust to changing financial circumstances. This limits the risk of disruption to the programme in the event of a shortfall in any of EAP's various sources of income, or an unexpected need for additional expenditure. On 30 June 2021 we reviewed our reserves policy to reflect our reduced operating costs and the scaling down of some of our programmes. The new reserves figure will cover six months operating costs, our office lease and other commitments. The trustees consider this level of reserves to be acceptable. At the year-end there were unrestricted funds of £464,983. Of this £260,000 is considered by the trustees to be held as reserves. £204,983 of the unrestricted funds is considered to be free reserves which EAP will use to carry out its charitable objectives. ## **Going concern** The trustees have assessed the financial position of the charitable company and assessed the impact of COVID-19. The charity's income has dropped £64,745 with a large proportion due to the difficulty in obtaining new funding in the present climate. The charity has been able to utilise the financial support from the government by claiming grants from the Coronavirus Job Retention Scheme. In June 2022 FCDO confirmed that £1m has been approved for CoST in 2022-23 with £1m approved in principle for 2023-24 and 2024-25, a total of £3m. This will allow EAP to have sufficient resources without cutting costs to meet its liabilities as they fall due for at least twelve months and secure its financial position in the longer term. ## **STATEMENT OF TRUSTEES' RESPONSIBILITIES** The trustees (who are also the directors of Engineers Against Poverty for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) including Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" Company law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the 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 those financial statements, the trustees are required to - select suitable accounting policies and then apply them consistently; - observe the methods and principles in the Charity SORP; - make judgements and estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business. The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to 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. In so far as the trustees are aware: - there is no relevant audit information of which the charitable company's auditors are unaware; and - the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information. ## **AUDITORS** The auditors, Magma Audit LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting. Approved by order of the board of trustees on ............................................. and signed on its behalf by: 14 JULY 2022 ........................................................................ J Downham - Trustee Page 5 **REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF ENGINEERS AGAINST POVERTY** ## **Opinion** We have audited the financial statements of Engineers Against Poverty (the 'charitable company') for the year ended 31 December 2021 which comprise the Statement of Financial Activities, the Statement of Financial Position, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. - In our opinion the financial statements: - give a true and fair view of the state of the charitable company's affairs as at 31 December 2021 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'; and - have been prepared in accordance with the requirements of the Companies Act 2006. ## **Basis for opinion** We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. ## **Conclusions relating to going concern** In auditing the financial statements, we have concluded that the trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report. ## **Other information** The trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Report of the Independent Auditors thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. ## **Opinions on other matters prescribed by the Companies Act 2006** In our opinion, based on the work undertaken in the course of the audit: - the information given in the Report of the Trustees for the financial year for which the financial statements are prepared is consistent with the financial statements; and - the Report of the Trustees has been prepared in accordance with applicable legal requirements. ## **Matters on which we are required to report by exception** In the light of the 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 Report of the Trustees. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of trustees' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit; or - the trustees were not entitled to take advantage of the small companies exemption from the requirement to prepare a Strategic Report or in preparing the Report of the Trustees. Page 6 **REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF ENGINEERS AGAINST POVERTY** ## **Responsibilities of trustees** As explained more fully in the Statement of Trustees' Responsibilities, 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. ## **Our responsibilities for the audit of the financial statements** Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Independent Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: Based on our understanding of the charity and the industry, we have identified that the principal risks of non-compliance with laws and regulations and we have considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as Companies Act 2006 and The Charities of Recommended Practice (SORP). We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting inappropriate journal entries, and management bias in accounting estimates. Audit procedures performed included: - Enquired with management for consideration of known or suspected instances of non-compliance with laws and regulations and fraud. - Challenging assumptions made by management in their accounting estimates. - Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations, journal entries crediting revenue, journal entries crediting cash and journal entries with specific defined descriptions. There are inherent limitations in the audit procedures describes above and the further removed non-compliant with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting in error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentation, or through collusion. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors. ## **Use of our report** This report is made solely to the 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 auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed. Victoria Craig (Senior Statutory Auditor) for and on behalf of Magma Audit LLP Magma House 16 Davy Court Castle Mound Way Rugby CV23 0UZ Date: ............................................. Page 7 **ENGINEERS AGAINST POVERTY** ## **STATEMENT OF FINANCIAL ACTIVITIES for the year ended 31 December 2021** **----- Start of picture text -----**
2021 2020
Unrestricted Restricted Total Total
fund fund funds funds
Notes £ £ £ £
INCOME AND ENDOWMENTS FROM
Donations and legacies 2 9,189 - 9,189 230
Charitable activities 4
Grant from other institutions 23,759 - 23,759 12,800
CoST Charity 395,285 16,032 411,317 507,310
Investment income 3 66 - 66 518
Other income 5 13,589 - 13,589 1,807
Total 441,888 16,032 457,920 522,665
EXPENDITURE ON
Raising funds 6 67,296 - 67,296 81,377
Charitable activities 7
Resources expended 447,079 16,032 463,111 593,615
Other 21,411 - 21,411 25,631
Total 535,786 16,032 551,818 700,623
-
NET INCOME/(EXPENDITURE) (93,898) (93,898) (177,958)
RECONCILIATION OF FUNDS
Total funds brought forward 558,881 8,741 567,622 745,580
TOTAL FUNDS CARRIED FORWARD 464,983 8,741 473,724 567,622
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The notes form part of these financial statements Page 8 **ENGINEERS AGAINST POVERTY** ## **STATEMENT OF FINANCIAL POSITION 31 December 2021** **----- Start of picture text -----**
2021 2020
Unrestricted Restricted Total Total
fund fund funds funds
Notes £ £ £ £
FIXED ASSETS
Tangible assets 12 510 - 510 1,813
CURRENT ASSETS
Debtors 13 75,414 5,000 80,414 110,922
Cash in hand 468,896 3,741 472,637 516,884
544,310 8,741 553,051 627,806
CREDITORS
Amounts falling due within one year 14 (79,837) - (79,837) (61,997)
NET CURRENT ASSETS 464,473 8,741 473,214 565,809
TOTAL ASSETS LESS CURRENT LIABILITIES 464,983 8,741 473,724 567,622
NET ASSETS 464,983 8,741 473,724 567,622
FUNDS 16
Unrestricted funds 464,983 558,881
Restricted funds 8,741 8,741
TOTAL FUNDS 473,724 567,622
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These financial statements have been prepared in accordance with the provisions applicable to charitable companies subject to the small companies regime. The financial statements were approved by the Board of Trustees and authorised for issue on ............................................. and were signed on its behalf by: 14 JULY 2022 ............................................. P Jowitt - Trustee ............................................. J Downham - Trustee The notes form part of these financial statements Page 9 **ENGINEERS AGAINST POVERTY** **STATEMENT OF CASH FLOWS for the year ended 31 December 2021** **----- Start of picture text -----**
2021 2020
Notes £ £
Cash flows from operating activities
Cash generated from operations 1 (44,304) (206,973)
Net cash used in operating activities (44,304) (206,973)
Cash flows from investing activities
Purchase of tangible fixed assets (9) (432)
Interest received 66 518
Net cash provided by investing activities 57 86
Change in cash and cash equivalents in
the reporting period (44,247) (206,887)
Cash and cash equivalents at the
beginning of the reporting period 516,884 723,771
Cash and cash equivalents at the end of
the reporting period 472,637 516,884
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The notes form part of these financial statements Page 10 **ENGINEERS AGAINST POVERTY** **NOTES TO THE STATEMENT OF CASH FLOWS for the year ended 31 December 2021** **----- Start of picture text -----**
1. RECONCILIATION OF NET EXPENDITURE TO NET CASH FLOW FROM OPERATING ACTIVITIES
2021 2020
£ £
Net expenditure for the reporting period (as per the Statement of
Financial Activities) (93,898) (177,958)
Adjustments for:
Depreciation charges 1,312 1,313
Interest received (66) (518)
Decrease in debtors 30,508 22,242
Increase/(decrease) in creditors 17,840 (52,052)
Net cash used in operations (44,304) (206,973)
2. ANALYSIS OF CHANGES IN NET FUNDS
At 1/1/21 Cash flow At 31/12/21
£ £ £
Net cash
Cash at bank and in hand 516,884 (44,247) 472,637
516,884 (44,247) 472,637
Total 516,884 (44,247) 472,637
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The notes form part of these financial statements Page 11 **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2021** ## **1. ACCOUNTING POLICIES** ## **Company status** The company is a company limited by guarantee. The members of the company are the Trustees named on page 1. In the event of the company being wound up, the liability in respect of the guarantee is limited to £1 per member of the company. ## **Summary of significant accounting policies** The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. ## **Basis of preparing the financial statements** The financial statements of the charitable company, which is a public benefit entity under FRS 102, have been prepared in accordance with the Charities SORP (FRS 102) 'Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', the Charities Act 2011 and the Companies Act 2006. The presentational currency of the financial statements is sterling (£). ## **Going concern** The trustees have assessed the financial position of the charitable company following the net expenditure for the prior and current year. At 31 December 2021 the charity had net current assets of £473,214 (2020: £565,809) and net assets of £473,724 (2020: £567,622). The trustees have assessed future cash flow forecasts and the potential impact an consider the charity to have sufficient resources to meet its liabilities as they fall due for at least twelve months from the signing of financial statements and have therefore prepared the financial statements on a going concern basis. ## **Income** All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably. Donated services or facilities are included in income at a valuation which is an estimate of the financial cost borne by the donor where such a cost is quantifiable and measurable. No income is recognised where there is no financial cost borne by a third party. Consultancy income and income from The Construction Sector Transparency Initiative is recognised once work is completed, excluding value added tax. Income tax recoverable in relation to donations received under Gift Aid or deed of covenant is recognised at the time of the donation. ## **Expenditure** All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources. Support costs are those costs incurred directly in support of expenditure on the objects of the charitable company. Irrecoverable VAT is shown in the category of resources expended for which it was incurred. Charitable activities include direct expenditure associated with providing the charitable services and support costs relating to those activities. Other resources expended consistent of governance costs which include those incurred in the governance of the charitable company and are primarily associated with constitutional and statutory requirements. ## **Tangible fixed assets and depreciation** Tangible fixed assets are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical costs includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Depreciation is charged so as to allocate the cost of assets less their residual value over their useful lives, using a straight line basis, as indicated below. Depreciation is provided on the following basis: Page 12 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **1. ACCOUNTING POLICIES - continued** ## **Tangible fixed assets and depreciation** Office equipment and website development - Over 3 years The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of financial activities. ## **Taxation** The charity is exempt from corporation tax on its charitable activities. ## **Fund accounting** General funds are unrestricted funds which are available for use at the discretion of the Trustees in furtherance of the general objectives of the charity and which have not been designated for other purposes. Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donor's or which have been raised by the charity for particular purposes. The costs of raising and administering such funds are charged against the specific fund. The charities restricted fund relates to an element of income received from The Construction Sector Transparency Initiative (CoST) of which is restricted to support CoST in achieving their objective of 'helping participating countries deliver better value from public infrastructure'. ## **Foreign currencies** At each year end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at the year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of financial activities. ## **Pensions** The charity contributes to a defined contribution pension scheme. Contributions are charged to the Statement of Financial Activities as they become payable. ## **Grants** The company has received funding in the form of grants relating to the Coronavirus Job Retention Scheme (CJRS). The grant funding is released to the Statement of Financial Activities in full in the year the conditions of the grant funding have been met. ## **Financial instruments** ## (i) Financial assets Basic financial assets, including trade and other debtors, cash and bank balances are initially recognised at transaction price, unless the arrangement constitutes as financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Such assets are subsequently carried at amortised cost using the effective interest rate method. ## (ii) Financial liabilities Basic financial liabilities, including trade and other creditors 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. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. Page 13 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **2. DONATIONS AND LEGACIES** |Donations
Appeals
**3.**
**INVESTMENT INCOME**
Interest receivable
**4.**
**INCOME FROM CHARITABLE ACTIVITIES**
Activity
Africa Catalyst Programme
Grant from other institutions
Institution of Civil Engineers
Grant from other institutions
TI Australia
Grant from other institutions
CoST
CoST Charity
**5.**
**OTHER INCOME**
Government grants
Insurance income
**6.**
**RAISING FUNDS**
**Raising donations and legacies**
Staff costs
**Other trading activities**
Bank charges
Depreciation
Aggregate amounts|**2021**
**£**
**8,974**
**215**
**9,189**
**2021**
**£**
**66**
**2021**
**£**
**9,712**
**-**
**14,047**
**411,317**
**435,076**
**2021**
**£**
**13,589**
**-**
**13,589**
**2021**
**£**
**65,620**
**2021**
**£**
**364**
**1,312**
**1,676**
**67,296**|2020
£
-
230
230
2020
£
518
2020
£
7,800
5,000
-
507,310
520,110
2020
£
-
1,807
1,807
2020
£
79,662
2020
£
402
1,313
1,715
81,377| |---|---|---| Page 14 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **7. CHARITABLE ACTIVITIES COSTS** |**CHARITABLE ACTIVITIES COSTS**||| |---|---|---| |**Provision of charitable services:**
Wages
Travel and subsistence
Consultancy costs
Support costs|**Total Funds**
**2021**
**£**
**271,649**
**1,585**
**35,372**
**154,504**
**463,110**|Total Funds
2020
£
294,068
2,766
58,964
237,817
593,615| |||| Analysis of support services is as follows:- |Analysis of support services is as follows:-||| |---|---|---| ||**Total Funds**|Total Funds| |Wages
Rent and other services
Insurance
Postage and stationery
Sundries
Subscriptions
IT and communications
Repairs and renewals
Professional fees|**2021**
**£**
**77,535**
**24,408**
**6,196**
**1,707**
**18,492**
**1,868**
**15,794**
**-**
**8,504**
**154,504**|2020
£
90,655
27,760
6,010
3,539
22,686
2,786
13,030
56,442
14,909
237,817| |||| ## **8. SUPPORT COSTS** |**SUPPORT COSTS**||| |---|---|---| |Other resources expended||Governance
costs
£
**21,411**| |Support costs, included in the above, are as follows:
Wages
Auditors remuneration|**2021**
Other
resources
expended
**£**
**16,421**
**4,990**|2020
Total
activities
£
**17,982**
**7,649**| ||**21,411**|**25,631**| Page 15 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **9. NET INCOME/(EXPENDITURE)** Net income/(expenditure) is stated after charging/(crediting): **----- Start of picture text -----**
|||| |---|---|---| |2021|2020| |£|£| |Auditors remuneration|4,990|7,649| |Depreciation - owned assets|1,312|1,313| |Pension costs|11,672|12,729| |Operating lease commitments|24,408|27,760| **----- End of picture text -----**
## **10. TRUSTEES' REMUNERATION AND BENEFITS** There were no trustees' remuneration or other benefits for the year ended 31 December 2021 nor for the year ended 31 December 2020. ## **Trustees' expenses** During the year, trustees received expenses of £271 (2020: £nil) for travel and other expenses. ## **11. STAFF COSTS** **----- Start of picture text -----**
|||| |---|---|---| |2021|2020| |£|£| |Wages and salaries|352,803|391,713| |352,803|391,713| |The average monthly number of employees during the year was as follows:| |2021|2020| |Administration and directorate|3|3| |Project Programme Officers|5|6| |8|9| **----- End of picture text -----**
The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was: **----- Start of picture text -----**
|||| |---|---|---| |2021|2020| |£60,001 - £70,000|1|1| |£70,001 - £80,000|1|1| |£100,001 - £110,000|1|-| |3|2| **----- End of picture text -----**
Page 16 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **12. TANGIBLE FIXED ASSETS** |**COST**
At 1 January 2021
Additions
At 31 December 2021
**DEPRECIATION**
At 1 January 2021
Charge for year
At 31 December 2021
**NET BOOK VALUE**
At 31 December 2021
At 31 December 2020
**13.**
**DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR**
Trade debtors
Accrued income
Other debtors
VAT
Prepayments
**14.**
**CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR**
Trade creditors
Other creditors
Accruals and deferred income|Website
£
**2,393**
**-**
**2,393**
**2,393**
**-**
**2,393**
**-**
-|Office
equipment
£
**11,502**
**9**
**11,511**
**9,689**
**1,312**
**11,001**
**510**
1,813
**2021**
**£**
**9,268**
**49,695**
**14,352**
**46**
**7,053**
**80,414**
**2021**
**£**
**64,044**
**4,970**
**10,823**
**79,837**|Totals
£
**13,895**
**9**
**13,904**
**12,082**
**1,312**
**13,394**
**510**
1,813
2020
£
-
89,328
14,352
46
7,196
110,922
2020
£
38,394
4,607
18,996
61,997| |---|---|---|---| ## **15. LEASING AGREEMENTS** Minimum lease payments under non-cancellable operating leases fall due as follows: |Within one year
Between one and five years|**2021**
**£**
**23,143**
**6,763**
**29,906**|2020
£
23,143
69,947
93,090| |---|---|---| Page 17 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **16. MOVEMENT IN FUNDS** |At 1/1/21
£
**Unrestricted funds**
General fund
**558,881**
**Restricted funds**
Restricted
**8,741**
**TOTAL FUNDS**
**567,622**
Net movement in funds, included in the above are as follows:
Incoming
resources
£
**Unrestricted funds**
General fund
**441,888**
**Restricted funds**
Restricted
**16,032**
**TOTAL FUNDS**
**457,920**
**Comparatives for movement in funds**
At 1/1/20
£
**Unrestricted funds**
General fund
741,839
**Restricted funds**
Restricted
3,741
**TOTAL FUNDS**
745,580
Comparative net movement in funds, included in the above are as follows:
Incoming
resources
£
**Unrestricted funds**
General fund
479,152
**Restricted funds**
Restricted
43,513
**TOTAL FUNDS**
522,665|Net
movement
At
in funds
31/12/21
£
£
**(93,898)**
**464,983**
**-**
**8,741**
**(93,898)**
**473,724**
Resources
Movement
expended
in funds
£
£
**(535,786)**
**(93,898)**
**(16,032)**
**-**
**(551,818)**
**(93,898)**
Net
movement
At
in funds
31/12/20
£
£
(182,958)
558,881
5,000
8,741
(177,958)
567,622
Resources
Movement
expended
in funds
£
£
(662,110)
(182,958)
(38,513)
5,000
(700,623)
(177,958)| |---|---| Page 18 continued... **ENGINEERS AGAINST POVERTY** **NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 31 December 2021** ## **16. MOVEMENT IN FUNDS - continued** A current year 12 months and prior year 12 months combined position is as follows: |**Unrestricted funds**
General fund
**Restricted funds**
Restricted
**TOTAL FUNDS**|At 1/1/20
£
741,839
3,741
745,580|Net
movement
in funds
£
(276,856)
5,000
(271,856)|At
31/12/21
£
464,983
8,741
473,724| |---|---|---|---| A current year 12 months and prior year 12 months combined net movement in funds, included in the above are as follows: |**Unrestricted funds**
General fund
**Restricted funds**
Restricted
**TOTAL FUNDS**|Incoming
Resources
Movement
resources
expended
in funds
£
£
£
921,040
(1,197,896)
(276,856)
59,545
(54,545)
5,000
980,585
(1,252,441)
(271,856)| |---|---| ## **17. EMPLOYEE BENEFIT OBLIGATIONS** At the year end the total pensions payable were £4,065 (2020: £3,080). ## **18. RELATED PARTY DISCLOSURES** Engineers Against Poverty undertakes the day to day management and finance function of a connected charity. Petter Matthews, the Executive Director of Engineers Against Poverty, is also a Trustee of the connected charity. During the year, the Engineers Against Poverty recharged £411,317 (2020: £507,310) relating to workshop costs and staff time incurred on behalf of the connected charity. At the year end included in debtors there was accrued income of £32,619 (2020: £89,328) and trade debtors of £9,250 (2020: £nil). The recharge includes an element of Petter Matthew's time. ## **19. POST BALANCE SHEET EVENTS** On 24 February 2022 Russia began its invasion of Ukraine which at the date of this report is still ongoing and it is uncertain how the conflict will end. This resulted in the announcement of sanctions against Russia. Given the interconnected nature of the modern world this conflict has an indirect impact on the UK economy through the sanctions imposed. The trustees have considered the impact of this conflict on the charity and consider that the charity has adequate resources to continue in operational existence for the foreseeable future despite the potential economic impact on the worldwide economy. Page 19 **ENGINEERS AGAINST POVERTY** ## **DETAILED STATEMENT OF FINANCIAL ACTIVITIES for the year ended 31 December 2021** **----- Start of picture text -----**
2021 2020
Unrestricted Restricted Total Total
funds funds funds funds
£ £ £ £
INCOME AND ENDOWMENTS
Donations and legacies
Donations 8,974 - 8,974 -
Appeals 215 - 215 230
9,189 - 9,189 230
Investment income
Interest receivable 66 - 66 518
Charitable activities
CoST 395,285 16,032 411,317 507,310
Africa Catalyst Programme 9,712 - 9,712 7,800
Institution of Civil Engineers - - - 5,000
TI Australia 14,047 - 14,047 -
419,044 16,032 435,076 520,110
Other income
- -
Government grants 13,589 13,589
Insurance income - - - 1,807
13,589 - 13,589 1,807
Total incoming resources 441,888 16,032 457,920 522,665
EXPENDITURE
Raising donations and legacies
Wages 65,620 - 65,620 79,662
Other trading activities
Bank charges 364 - 364 402
Depreciation of tangible fixed assets 1,312 - 1,312 1,313
1,676 - 1,676 1,715
Charitable activities
Wages 270,762 - 270,762 294,069
Sundries - 16,032 16,032 38,513
Support costs 174,732 - 174,732 258,267
Travel and subsistence 1,585 - 1,585 2,766
447,079 16,032 463,111 593,615
Support costs
Governance costs
Wages 16,421 - 16,421 17,982
Auditors remuneration 4,990 - 4,990 7,649
21,411 - 21,411 25,631
**----- End of picture text -----**
This page does not form part of the statutory financial statements Page 20 **ENGINEERS AGAINST POVERTY** ## **DETAILED STATEMENT OF FINANCIAL ACTIVITIES for the year ended 31 December 2021** **----- Start of picture text -----**
2021 2020
Unrestricted Restricted Total Total
funds funds funds funds
£ £ £ £
Total resources expended 535,786 16,032 551,818 700,623
-
Net (expenditure)/income (93,898) (93,898) (177,958)
**----- End of picture text -----**
This page does not form part of the statutory financial statements Page 21