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2020-09-30-accounts

QUAKER INTERNATIONAL EDUCATIONAL TRUST ANNUAL REPORT AND FINANCIAL STATEMENTS YEAR ENDED 30 SEPTEMBER 2020

Company Limited by Guarantee Registration Number: 3653506 (England and Wales) Charity Registration Number: 1072250

INDEX

Page 1-11 Trustees’ Report 12-14 Independent Auditor’s Report 15-16 Statement of Financial Activities 17 Balance Sheet 18 Statement of Cash Flows 19-30 Notes to the Financial Statements

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Reference and administrative details

Trustees (current)

Paul High, Chair Averil Armstrong, Treasurer John Crosfield Rajit Gholap (appointed 1 July 2020) Michael Goodwin (appointed 1 July 2020) Dr Khater Abi Habib (appointed 1 March 2020) Will Haire, Vice Chair David Hickok Hani Aboul Jabine Juhaina Abu Khalil Antonios (Tony) Mannaseh (appointed 1 January 2021) Marie-Christine Mojabber (appointed 1 January 2021) Digby Swift Antoine Wakim

Secretary Martin Macpherson

Registered Office

Beaver House 23-38 Hythe Bridge Street Oxford, OX1 2EP

Charity’s School Brummana High School Brummana Lebanon

Chair of School Governors Hani Aboul Jabine

Vice-Chair George Younes

Chair of the Finance Committee Antoine Wakim

Principal Bursar David Gray Raymond El-Feghali

Company number 3653506 (England and Wales) Charity number 1072250

Auditors

Critchleys Audit LLP, Beaver House, 23-38 Hythe Bridge Street, Oxford, OX1 2EP

Bankers CAF Bank, Kings Hill, West Malling, Kent, ME19 4TA

Solicitors

Bates Wells Braithwaite London LLP, 10 Queen Street Place, London EC4R 1BE

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

The Trustees present their statutory report together with the financial statements of the Quaker International Educational Trust (QuIET) for the year ended 30 September 2020.

The report has been prepared in accordance with the Charities Act 2011 and also represents a directors’ report for the purposes of company legislation.

The financial statements have been prepared in accordance with the accounting policies set out on pages 19 to 21 of the attached financial statements and comply with the charitable company’s Memorandum and Articles of Association, applicable laws and the requirements of the Statement of Recommended Practice “Accounting and Reporting by Charities” issued by the Charity Commission (FRS102).

Structure, governance and management

Constitution

QuIET is a registered charity, Charity Registration number 1072250, registered on 3 November 1998 and is also a company limited by guarantee, Company Registration number 3653506, registered on 15 October 1998. The incorporated charity is governed by its Memorandum and Articles of Association.

Trustees

The Trustees constitute the members and directors of the company for the purposes of the Companies Act 2006 and trustees of the charity for the purposes of charity legislation.

The Board of Trustees consists of not less than seven nor more than fifteen members.

The Trustees are appointed by the Friends World Committee for Consultation through its Europe and Middle East Section Executive Committee. The majority must be members of the Religious Society of Friends (Quakers) and at 30 September 2020 nine of the twelve Trustees were Quakers. The Trustees comprise members who have extensive experience of Brummana High School (BHS) and the Middle East or in education, or both.

Trustees are appointed for a period of four years and shall be eligible for re-appointment for a further four years. No Trustee who has served for a continuous period of eight years is eligible for re-appointment until at least one year has elapsed.

The following Trustees were in office on 30 September 2020, and had served throughout the year except as shown:

Averil Armstrong, Treasurer John Crosfield Rajit Gholap (appointed 1 July 2020) Michael Goodwin (appointed 1 July 2020) Dr Khater Abi Habib (appointed 1 March 2020) Will Haire (Vice Chair) David Hickok Paul High (Chair) Hani Aboul Jabine (Chair of Board of BHS) Juhaina Abu Khalil Digby Swift Antoine Wakim

The following Trustees were appointed after the year-end:

Antonios (Tony) Mannaseh (appointed 1 January 2021) Marie-Christine Mojabber (appointed 1 January 2021)

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

On agreeing to become a trustee of the charity, new Trustees are briefed by their Co-Trustees on: the history of the charity and its day-to-day management, the responsibilities of the Trustees, the current objectives and future plans. Trustees are encouraged to attend courses which they consider to be relevant to the development of their role and to keep abreast of changes in legislation.

The Trustees are responsible for the policies, activities and assets of the charity. They meet during the year to review the work of the charity and to take appropriate decisions. When necessary the Trustees seek advice and support from the charity’s professional advisors. The day-to-day management of the charity’s school in Lebanon, Brummana High School, is delegated, through the Board Constitution, to the school’s Governors. The school administers all its accounting records which are audited in Lebanon before translation and inclusion within the charity’s financial statements.

No Trustee received any remuneration for services as a member of the Board of Trustees but expenses for travelling and accommodation totalling £934 (2019 - £2,799) were reimbursed to 5 Trustees (2019– 6). No member of the Board of Trustees had any beneficial interest in any contract with the charity during the year.

Trustees’ responsibilities statement

The Trustees (who are directors of QuIET for the purposes of company law) are responsible for preparing the Trustees’ Report and the accounts in accordance with applicable law and regulations.

Company law requires the Trustees to prepare accounts for each financial year. Under that law they have elected to prepare the accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).

Under company law the Trustees must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and of the profit or loss of the charitable company for that period. In preparing these accounts, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions and disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the accounts 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.

So far as the Trustees are aware, there is no relevant audit information (information needed by the charitable company’s auditors in connection with preparing their report) of which the company’s auditors are unaware; and

Each Trustee has taken all the steps that ought to have been taken as a director in order to make themselves aware of any relevant audit information and to establish that the charitable company’s auditors are aware of that information.

Members’ liability

The liability of members in the event of the charitable company being wound up is limited to £1 per member.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Objectives and activities

The objects of the charity are to manage the premises and undertakings of Brummana High School in Lebanon and to advance the education of children and young people in full time education in accordance with the principles of the Religious Society of Friends (Quakers).

The charity undertakes fundraising in the UK for Ramallah Friends School in Palestine. The funds provided financial support to enable students from financially poor families to attend the schools.

In the light of these activities, the Trustees consider that the charity’s objects continue to be appropriate.

The overall strategies for achieving these objectives comprise:

The Board of Governors of Brummana High School accepts this delegation through its Constitution and the Guidelines for Governors. The Guidelines identify six strategic responsibilities for the Board. The guidelines reflect the common understanding of the Board’s role.

  1. To formulate and guide the overall policy for the School. The Board expresses its aim of running the School in keeping with the principles of the Religious Society of Friends (Quakers) through its Mission Statement and definition of the School’s values and ethos. It seeks to involve parents, students, old scholars and staff through personal and direct communication, newsletters and the School’s web site www.bhs.edu.lb. Periodically the Board will commission external reviews of major elements of school management.

  2. To plan the School’s development, the Board has recognised the need for both a Master Plan describing the facilities required as the School grows and also for a forum, steered by the Principal, to take the lead in co-coordinating fundraising and appeals for the capital required.

  3. In taking responsibility for the School’s educational policy the Board has appointed an Education Committee of the Board, comprising Governors who are senior educationalists in Lebanon, to advise it and give a lead in keeping the School’s educational programmes under review and in identifying appropriate strategies. These include:

  4. Close liaison with the Ministry of Education in Lebanon and with universities in Lebanon and elsewhere;

  5. The provision of curricula through both the Lebanese Programme and an International Programme to meet the needs of the diverse background of young people in Lebanon: and the delivery of the International Baccalaureate Programme following their acceptance as an IB Diploma School;

  6. Sustaining the development of a high-quality faculty through appropriate policies for recruitment, departmental management and in-service training;

  7. Formulating and implementing policies and practice for learning and for day and boarding school life.

    • .

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Objectives and activities (continued)

  1. To assist it in taking control and responsibility for finance the Board has appointed a Finance Committee of the Board chaired by the Financial Governor. Key operational strategies are:

  2. Budgetary control of all the School’s income and expenditure and its cash flow, which is delegated at a detailed level to the Principal and Bursar;

  3. Supporting planning for education, the campus and services in the long and short term with financial analysis and market research. (There is fierce competition among schools in Lebanon and in other Middle East Countries for good teachers);

  4. Taking a cautious approach to financial projections and currency management in the light of economic hardship and political uncertainty in Lebanon;

  5. Maintaining transparency in accounting to the School community, to Lebanese authorities and to QuIET.

  6. Appointing the principal officers, the Principal and the Bursar, is recognised as the Board’s single most important function. It is also appreciated that this may occur only once during the term of any Governor and detailed advice on their recruitment, selection and appointment is given in The Guidelines for Governors.

  7. In fulfilling responsibility for the School’s Health and Safety Policy’s compass and implementation, delegated to the Principal, Bursar and staff, the Board’s Property Committee, receives and considers reports from the School’s Health and Safety Committee.

Employees

QuIET strives to be an equal opportunities employer and applies objective criteria to assess merit. It aims to ensure that no job applicant or employee receives less favourable treatment on the grounds of age, race, colour, nationality, religion, ethnic or national origin, gender, marital status, sexual orientation or disability.

Selection criteria and procedures are reviewed to ensure that individuals are selected, promoted and treated on the basis of their relevant merits and abilities. All employees are given equal opportunity and, where appropriate and possible, special training to enable them to progress both within and outside the organisation. QuIET is committed to a programme of action to make this policy effective, and to bring it to the attention of all employees.

The Board, represented by its Chairman and Financial Governor, review the remuneration of the charity’s key management personnel, namely, the Principal and the Bursar. Based on the School’s performance and after looking at other similar school’s remuneration in Lebanon and in the UK, and the guidelines from the ISBA and The Society of Heads (SoH); they decide on the total packages to be offered. It is common to offer accommodation to the Head and Bursar in Boarding schools as their presence on campus helps them to fulfil their respective jobs better by being close to the boarding students and to attend swiftly to any need that might arise.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Organisation

The management and affairs of the charity are the responsibility of the Trustees, who usually meet twice a year. At least one of these meetings is normally held at the School. This allows Trustees to spend some days at the school to meet staff, parents’ representatives and students. In addition, the opportunity is taken to meet with Governors to discuss governance, strategy and the Board’s plans. The Trustees did not meet at the school in 2020 due to the Covid-19 pandemic. Further induction and training for all trustees is provided through access to the School’s website www.bhs.edu.lb, the minutes of the Board and its sub-committees and access to the charity’s records.

The management of Brummana High School is delegated to the Board of Governors appointed by the Trustees. The Board of Governors is directed by the Trustees through the School Constitution and by the Guidelines for Governors provided by the Trustees. A Governors’ Nominations Committee composed of the Chair of the Board and the three heads of standing sub-committees nominates names to QuIET for approval, in the light of the agreed skill needs. The Chair of QuIET co-signs a letter of appointment on behalf of QuIET. The Board of Governors meets at least once each School term and appoints the Principal and Bursar to whom appropriate responsibilities are given so that they may carry out the day to day operation of the School. Candidates for the Board of Governors are identified and recommended for appointment by a nominations group, which employs the criteria of general suitability and sympathy with Quaker values for prospective Governors. Serving politicians are not eligible for appointment as Governors. At least one Governor will be an Old Scholar and one a member of Brummana Monthly Meeting of the Society of Friends. Two or more members of the Board of Governors may also serve as Trustees and Directors of QuIET. In this report period four members of the Board of Governors served as Trustees and Directors of QuIET.

The Old Scholars Association plays an important role in supporting the School. The association is currently exploring ways in which it can strengthen its fundraising efforts for the benefit of the development of the School.

The Trustees have reviewed the Charity’s governance and in the light of both the review and the advice of QuIET’s solicitor, the Trustees are seeking to strengthen the current governance arrangements with closer co-operation between Trustees and the Board of Governors.

Strategic Report

Achievements and Performance

The Brummana High School has suffered severe disruption due to political and economic turmoil, the Covid-19 virus and the 4th August 2020 explosion in Beirut which resulted in many deaths and injury and impoverished thousands of people. These are big challenges which are causing some families much financial hardship and affecting their ability to pay school fees. There is increased pressure on the school finances and more students are expected to need support from the BHS bursary fund. Faced with these challenges the school moved its teaching and management online and postponed some events. Despite the situation everything is being done it to ensure that the children’s education is not compromised and much has been achieved in these difficult times.

A central element of Brumanna High School’s contribution to young people in Lebanon and beyond is its constant presence and stability. The school’s Governors, appointed by the Trustees, have given the Principal, David Gray, and his staff, and consequently students and their families, the confidence and support to sustain a strong and welcoming school community.

The Board attaches overriding importance to students’ character development and to encouraging independent, critical thought. In addition, the two measures of pupil numbers and exam results are monitored carefully.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Achievements and Performance (continued)

Pupil numbers at Brummana High School: Brummana High School has students of many nationalities and in 2019/2020 there was a complement of 1264 day students and 9 boarders during the year. This compares with 1213 day students and 9 boarders in 2018/2019. The steady numbers at the earlier stages, Playgroup and Infant and Primary 765 in 2020 versus 760 in 2019 is very encouraging and is a counterweight to the volatility in student numbers caused by geo-political uncertainty.

At Brummana High School the student is at the centre of school life and it is to the allround, intellectual, social, moral, and aesthetic development of the students that all work by the Principal and his staff is dedicated.

The school has continued its adjustment to the CIE Programme. Students currently in Grade 9 will take seven subjects in IGCSE over two years and will be required to pass them (at C or above) at the end of Grade 10 before going on to study for A Level or IB in Grade 11.

This year, students in grades 10 and 11 and a few in Grade 12 will conclude their study of five IGCSE’s, gaining passes (at C or above) in at least four of them. Owing to the onset of COVID-19 and the subsequent lockdown, they will be sitting for the IGCSE’s in November 2020 rather than in June as originally scheduled. They will then go on to study AS Level in the International Programme over two years in the case of Grade 11, and over one year for Grade 12 students. Grade 12 students will not, however, sit the examinations at the end of the year.

As the June 2020 IGCSE examinations were cancelled and the students were re-entered for their examinations in November, there are no results to report. These will form part of the report for 2020/2021.

The International Baccalaureate (IB) is now recognised by the Lebanese Government as having equivalency to the Lebanese Baccalaureate and so is available to Lebanese Programme students as well as to International Programme students. In 2020, for the IB, there were 12 candidates all of whom gained the Diploma, a 100% pass rate against a 94% pass rate the previous year when there were 16 students. The average points score was 34 in 2020 as against 33 in 2019 and 30 in 2018. It ought to be pointed out that the IB examinations were cancelled and that assessment was measured against course work and other internal components.

The Lebanese Programme’s Official Examinations were also cancelled on account of COVID-19 and all students were automatically passed as was also the case for 2020 for the Brevet taken by Grade 9 students. For the record the success rate in the Lebanese Programme’s official examinations for 2019 was 93% with 25 out of 27 passing, while in the Brevet the 41 candidates had gained a 100% pass rate in 2019.

A wide range of school activities from the Student Council and Prefects’ Systems to clubs for particular esoteric interests are fostered and expressive subjects such as art, drama, music, dance, singing and writing, combined with sports, through exhibitions, competition and performances, offer a wide range of opportunities for personal development. BHS students won a number of prestigious awards in the Model United Nations and Model Arabic League at National level. These two programmes train participating students in diplomacy and improve their negotiation and leadership skills. The community also benefits from the school’s extra curricular programme - by making the school’s swimming and sports facilities open to the public in out of school hours and holidays.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Achievements and Performance (continued)

The second half of the 2019/2020 academic year was marked by the absence from school of all its students, depriving them of the important social and interactive development which any school provides. However, the system of online teaching and learning worked well. Students soon adjusted to the comprehensive programme of academic, pastoral, and extracurricular development which was provided thanks to the wonders of modern technology and on the introduction of TEAMS and Moodle platforms. Although there may have been a shortage of examinations and of social interaction at a cost to the students, they nevertheless mastered quickly, along with their teachers, the finer points of sophisticated communication through the use of ICT. While in retrospect academics may look back on the years of the pandemic as missing years, they were filled in some ways with the development of skills which the students would otherwise have missed. And undoubtedly the one strength which they certainly developed was that of resilience, an essential prerequisite for a successful life.

Due to the COVID 19 pandemic and the related lockdown the summer camp as well as other planned events did not take place in 2020. The school campus was closed on February 29, 2020 and is stayed closed until September 30, 2020.

Public Benefit

When setting the objectives and planning the work of the charity the Trustees give careful consideration to the Charity Commission’s general guidance on public benefit.

Brummana High School was established in 1873 to provide an education in keeping with the principles of the Religious Society of Friends (Quakers). Education in the 19[th] Century has been described as rudimentary, and meaning, for the majority of children, “a vague acquaintance with the Arabic alphabet and perhaps memorising a few numbers” within a setting of strict religion and harsh discipline. The new Quaker school reduced the emphasis on religious instruction, introduced the physical sciences, and took a more secular and critical approach to the humanities in a setting where the dominant principles were, and still are, those of peace, equality, simplicity and truth. It set a valuable example of high educational standards and continues to do so.

The School is open to girls and boys from any religious background, or none, and who may attend for a part or all of their schooling. The School’s quality and accessibility attracts students from its own locality, nationally in Lebanon, and internationally, especially within the Middle East. Thereby, it makes a substantial contribution to the culture and prosperity of the community immediately around it, as well as doing so more widely. In 2003 the School was awarded the prestigious President’s Gold Medal for its contribution to Education in Lebanon and the Middle East over very many years.

Without financial endowment or Government subsidy, the School is dependent on fee income to remain financially viable and on summer activities, donations and grants to develop. In order to minimise the barrier that fees pose to students from poor families the Board aims to contain fees to the amount needed to run the school day to day, and decisions on fees are made in agreement with the Parents’ Association. The Board provides, through their Municipalities, 5 full bursaries to Brummana village and 2 full bursaries to Roumieh village, the villages in which the school campus lies. These bursaries are usually divided amongst several pupils according to need. In addition, the Board has a bursary scheme which makes awards solely on the basis of financial need to existing students whose families are experiencing hardship. The School also awards bursaries to enable the children of staff members to attend, together with sibling bursaries a discount starting with the third child for families who have more than two children enrolled at the School. More than 417 students received from the school a bursary worth, on average 30% of the tuition fee. In addition around 25 students received from the Old Scholars Association a bursary worth on average 70% of the tuition fee. The Trustees have again appealed to Quakers in the UK, Ireland and other European countries for gifts towards the bursary scheme and raised £16,550, in the year to September 2020 (2019: £11,445) in addition to £9,049 collected for the Beirut fund, a fund that was created to assist the parents whose houses or businesses were damaged by the August 4th 2020 explosion in the Beirut port. This fund collected around £41,500 that was granted to the parents during the academic year 2020 / 2021.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Public Benefit (continued)

In order to provide money for improvements and major repairs, and to meet occasions when fee income is insufficient to meet all running costs, the Board, in normal circumstances, holds a Summer programme of education and other activities open to young people both from the locality and further afield. As described earlier, the School maintains close ties with its surrounding communities both through students’ and teachers’ active Community Service programmes and by making the School’s sports and swimming facilities open to the public out of School hours and in the holidays.

QuIET has continued to appeal through “The Friend” for bursary funds at Ramallah High School in Palestine. Friends gave £49,843 to this appeal in the year to September 2020 (2019: £27,297).

Financial Review

Income decreased from £7,189,468 in 2019 to £4,842,548 – a decrease of 32.6% Within total income, net tuition and related fees increased from £5,093,529 in 2019 to £5,110,869 – an increase of 0.3% The decrease in the income is mainly due to the school closure owing to the COVID 19 pandemic whereby the school had to deduct a percentage of its tuition fees and bus fees due to closure from March 1 till the end of the year. The reduction in income also reflects an increase in credit loss provision of £1,540,542 as a result of the new International Financial Reporting Standards (IFRS) in allowances for expected credit loss while other expenditures were substantially increased due to the security uncertainty in Lebanon and the major devaluation of the local currency.

Expenditure decreased from £6,692,226 in 2019 to £5,900,027 in 2020, a decrease of 11.8%, mainly due to reduced expenditure on supplies and equipment as a result of the children’s remote learning. In addition, the fluctuation of the Sterling pound value against the US Dollars affected the value of the reported expenditures The Governors have exercised caution and careful stewardship to contain costs during the year.

The net movement in funds changed from a surplus of income of £980,405 in 2019 to a deficit of £1,462,456 in 2020. The Trustees consider the financial state of affairs at 30 September 2020 to be internally under control considering the challenges Brummana High School and Lebanon is facing.

The balance sheet shows a decrease in total reserves from £11,975,603 in 2019 to £10,513,147 in 2020.

Of these, restricted funds at the year-end amounted to £50,923 (2019: £54,162). Full details of the movements in the year on the restricted funds can be found in note 23 to the financial statements.

The tangible fixed assets fund represents the net book value of the tangible fixed assets of the charity. Such assets are essential to the charity being able to continue to fulfil its charitable objectives and, as such, do not represent funds which can be realised except in exceptional circumstances.

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QUAKER INTERNATIONAL EDUCATIONAL TRUST TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Risk Management

The Trustees have a risk register for managing the major risks to which the charity is exposed. The five Deeds of plots #1215 - 1308 – 1310 – 1311 and 1729 are now re-registered in the name of Friends Foreign Mission Association Trust Corporation (FFMATC). This means that all the plots at Brummana High School are now held correctly in the name of FFMATC. The Risk Register includes governance risks, operational risks, financial risks, external risks and compliance with law and regulation. The register is a standing item on the agenda of every Trustee meeting and is reviewed to amend any existing risks, to include any new risks and to agree appropriate mitigating actions. The key risks facing the charity at the present time include a reduction in school income due to political and economic situation in Lebanon, the 4th August 2020 explosion in Beirut and the Covid-19 virus all of which are causing families financial hardship and affecting their ability to pay school fees. There is also the downturn in numbers of boarders attending the school and the potential loss of control arising from the location of the school in Lebanon. The Trustees have put measures in place and have taken mitigating actions to address the risks and will continue to monitor them carefully.

Investment policy and performance

Surplus cash held by the School in Lebanon is invested in short term deposits in a number of banks. The Trustees are content with the investment income of £803,571 in 2020 (2019: £757,385).

The unprecedented severe financial, economic and monetary crisis that Lebanon has been witnessing since October 2019 has significantly increased credit, liquidity, market and operational risks. Banks limited foreign currency withdrawals and restricted transfers overseas. During December 2019, there was a credit risk rating downgrade by a rating agency of certain local rated banks to “C” category. Sharp fluctuation in the market foreign currency exchange rate and the creation of parallel markets with a wide range of price variance were witnessed in comparison to the official peg of LBP1,507.50 to the US Dollar. Furthermore, the sovereign credit risk rating started to witness consecutive downgrading by all major rating agencies to reach the level of default on March 7, 2020, when the Lebanese Government announced that it will withhold payment on the bonds due on March 9, 2020, followed by another announcement on March 23, 2020 for the discontinuation of payments on all of its US Dollars denominated Eurobonds. This led to a further deterioration in the market value of Lebanese Government bonds to reach junk status. The market value of all other financial assets has also been adversely impacted. On April 30, 2020, the Lebanese Council of Ministers approved the Lebanese Government’s Financial Recovery Plan (the Plan) which includes among other items, reviewing the peg policy, restructuring of the government debt, restructuring of the financial system and the banking sector, and international financial assistance. On May 1, 2020, a formal request for support from the International Monetary Fund (IMF) was addressed to the IMF and discussion is still ongoing at the date of issue of the financial statements with no progress made so far.

The Trustees, and School's Board of Governors, continue to closely monitor the safety of the funds held. For funds held in the UK, security is being prioritised over investment return to ensure that QuIET is able to settle international obligations as they fall due. The accounts include a credit loss provision to factor in the increased risk of default of banking institutions.

Reserves policy

The Trustees have examined the requirement for free reserves i.e. those unrestricted funds not invested in tangible fixed assets, designated for specific purposes or otherwise committed. The Trustees consider that given the uncertainties in Lebanon a figure equivalent to 2 years’ expenditure would not be excessive. This will allow the charity to cope and respond to unforeseen emergencies whilst specific action plans are implemented.

The level of free reserves at 30 September 2020 amounts to £7,540,113 (2019: £8,893,126) (equivalent to approximately 13 months’ expenditure on unrestricted funds) and the intention is to try and increase these reserves as finances allow.

As at 30 September 2020 the total funds of the charity were £10,513,147 (2019: £11,975,603). £50,923 of this was represented by restricted funds (2019: £54,162), £2,922,111 by the designated tangible fixed asset fund (2019: £3,028,315), with the balance being free reserves.

QUAKER IKfERNATIONAL EDUCATIONJL TRUST The Chath￿3 assets Acquisrtions and di8FM)sab Or￿ed assets dwing are rwxded in notes 14 and 15 to the financial slalements. The lon￿terM role of the laThJ at Seriw is beiw ￿[de￿ by Tnthes in co￿ul18tic￿ wilh the Board of Governo￿. Plans for ftrture perfods Although a list of (2pital prc¥&ts was wep￿j the CL¥nMMJ 3 >￿￿8 the cUff￿t financial Nisis mear that no major projects WIN take r4ace in the foreseeatrAe frjtyre. have obseNed that it is havuvJ a negative eff￿1 on th& 8oJnomy and financi¥ situatton in Leb8non. Therefore. whiie continuing Mih oJrrEnt pmiects, further Ca￿￿1 exrwditure wiu only b8 (Jjmmitted caution. Furthermore, given the significant of rec￿nt oprtal IKoi8(as. the Board adwses th8t funds should b6 accumulated before embth#KJ on any futswe prcI￿ any r￿W prw Mfjll be supwrted through SFeufic fundraisiThJ. The Trustees are thsed th* the regtstratsc￿ of all Ihe Schcxjl land. of QUI￿ is tho beneficial owner, is resofved and that all the plots are now register￿1 in the rwne of the Friends Foreign Mission A&%oc4ation Trust Co￿tiOn IFFMATC) as bare trustee. The Board has aLso engaged in the wocess of a strKxt temi and kxw4enn visk)n for the futu￿ developxnent of the Sthcd. The Twstees wll ts)ntmue to r•se funts for trA)th 8rummaw Hwjh SC1K￿l's arwj Ramalah FTwds Approved by ts Tr￿ ffi 19 June 2￿21 aTrl on betjalfof the Tntstees by Paul Hlgh (Chair)

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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF QUAKER INTERNATIONAL EDUCATIONAL TRUST

Opinion

We have audited the financial statements of Quaker International Educational Trust (the “Charity”) for the year ended 30 September 2020 which comprise the Statement of Financial Activities, Balance Sheet, 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, 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 Charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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:

Emphasis of matter

We draw your attention to note 3 to the financial statements which describes critical accounting estimates and judgements in respect of credit loss provisions, US dollar bank balances in Lebanon and exchange rates for converting transactions and balance in Lebanese pounds to UK sterling

Our opinion is not modified in this respect

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 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.

13

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF QUAKER INTERNATIONAL EDUCATIONAL TRUST (CONTINUED)

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ report.

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

•adequate and proper accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

Responsibilities of the trustees

As explained more fully in the trustees’ responsibilities statement set out on page 3 the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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.

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.

14

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF QUAKER INTERNATIONAL EDUCATIONAL TRUST (CONTINUED)

Use of our report

This report is made solely to the Charity’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 Charity’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charity’s members as a body, for our audit work, for this report, or for the opinions we have formed

Robert Kirtland (Senior Statutory Auditor) for and on behalf of Critchleys Audit LLP, Statutory Auditor

Oxford 29 June 2021 Date………..

15

QUAKER INTERNATIONAL EDUCATIONAL TRUST STATEMENT OF FINANCIAL ACTIVITIES (INCLUDING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 30 SEPTEMBER 2020

Note
Unrestricted
Funds
Restricted
Funds
£
£
Income from
Donations and legacies
4
10,697
109,628
Investments
5
(983,558)
-
(972,861)
109,628
Charitable activities
School fees and related receipts
6
5,710,779
-
Other
(Loss)/Gain on foreign exchange
(4,998)
-
Total income
4,732,920
109,628
Expenditure
Charitable activities:
Provision of education at Brummana High
School, Lebanon
Teaching costs
7
3,840,346
-
Support and administration of the school
8
2,006,599
-
Grants to other schools
9
-
53,082
Total expenditure
5,846,945
53,082
Net (expenditure)/income before foreign
exchange adjustment
(1,114,025)
56,546
(Loss)/gain on foreign exchange adjustment
(404,977)
-
Net (expenditure)/income
11
(1,519,002)
56,546
Transfers between funds
23
59,785
(59,785)
Net movement in funds
(1,459,217)
(3,239)
Reconciliation of funds
Fund balances brought forward at 1 October
2019
11,921,441
54,162
Fund balances carried forward at 30 September
2020
10,462,224
50,923		 Total
2020
Funds
£
120,325
(983,558)
(863,233)
5,710,779
(4,998)
4,842,548
3,840,346
2,006,599
53,082
5,900,027
(1,057,479)
(404,977)
(1,462,456)
-
(1,462,456)
11,975,603
10,513,147		 Total
2019
Funds
£
101,998
529,724
631,722
6,545,419
12,327
7,189,468
4,614,508
2,077,718
-
6,692,226
497,242
483,163
980,405
-
980,405
10,995,198
11,975,603

There is no difference between the net movements in funds stated above, and the historical cost equivalent. All of the charity’s activities derived from continuing operations during the above two financial periods.

16

QUAKER INTERNATIONAL EDUCATIONAL TRUST STATEMENT OF FINANCIAL ACTIVITIES (INCLUDING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 30 SEPTEMBER 2019

Note
Unrestricted
Funds
Restricted
Funds
£
£
Income from
Donations and legacies
4
39,540
62,458
Investments
5
529,724
-
569,264
62,458
Charitable activities
School fees and related receipts
6
6,545,419
-
Other
Gain on foreign exchange
12,327
-
Total income
7,127,010
62,458
Expenditure
Charitable activities:
Provision of education at Brummana High
School, Lebanon
Teaching costs
7
4,614,508
-
Support and administration of the school
8
2,077,718
-
Grants to other schools
9
-
-
Total expenditure
6,692,226
-
Net income before foreign exchange
adjustment
434,784
62,458
Gain on foreign exchange adjustment
483,163
-
Net income
11
917,947
62,458
Transfers between funds
23
35,161
(35,161)
Net movement in funds
953,108
27,297
Reconciliation of funds
Fund balances brought forward at 1 October
2018
10,968,333
26,865
Fund balances carried forward at 30 September
2019
11,921,441
54,162		 Total
2019
Funds
£
101,998
529,724
631,722
6,545,419
12,327
7,189,468
4,614,508
2,077,718
-
6,692,226
497,242
483,163
980,405
-
980,405
10,995,198		 Total
2019
Funds
£
101,998
529,724
631,722
6,545,419
12,327
7,189,468		 Total
2019
Funds
£
101,998
529,724

4,614,508
2,077,718
-
6,692,226

497,242
483,163

11,975,603

There is no difference between the net movements in funds stated above, and the historical cost equivalent. All of the charity’s activities derived from continuing operations during the above two financial periods.

17 8ALANCE SHEET 2019 Tangible assets 14 2.922.111 3.028.315 15 341 3263.201 3.282.490 Stock Debtors Cash at bank and in harKI 16 17 18 189.657 531.159 24 9.W.154 510,616 11 8￿286 12.478,166 11.761.310 13.424,338 Cre(fttors: amc￿Thts due aftermNe than 21 (254,487) 1243.8381 Pruvbsior￿ for li8bilitK$ and (tsge Funds ol the clwity: 54.162 Unrestricted Ir￿r fiJThJs Generd fvnds TaThjIb￿ fjxed assets fuTrJ 7.540.113 2922111 24 8.893.126 Total fvnds Appr￿￿ and aulhorised for issue by Pod Tn&slees 19 June2021 and 8¥Jned M ib behalf ty. Paul High Twstee

18

QUAKER INTERNATIONAL EDUCATIONAL TRUST STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 SEPTEMBER 2020

Note
Net cash (utilised in)/provided by
operating activities
A
Cash flows from investing activities
Investment income
Purchase of investment bond
Purchase of tangible fixed assets
Net cash (utilised in)/provided by investing
activities
(Decrease)/increase in cash
Cash at 1 October 2019
Cash at 30 September 2020
18		 2020
£
(1,185,725)
(983,558)
(86,915)
(388,750)
(1,459,223)
(2,644,948)
11,890,286
9,245,338		 2019
£
1,413,141
529,724
(19,346)
(390,978)
119,400
1,532,541
10,357,745
11,890,286

A. Reconciliation of net income to net cash provided by operating activities

Net (expenditure)/income for the year
Investment income receivable
Depreciation
Increase in stocks
Increase in debtors
(Decrease)/increase in creditors
(Decrease)/increase in provisions

Net cash (utilised in)/provided by operating activities		 2020
£
(1,462,456)
983,558
494,954
(112,393)
(20,543)
(857,624)
(211,221)
(1,185,725)		 2019
£
980,405
(529,724)
533,576
(3,839)
(125,356)
369,052
189,027
1,413,141

19

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

1. CHARITY INFORMATION

The charity is a public benefit entity. It is a UK company limited by guarantee with its registered office at Beaver House, 23-38 Hythe Bridge Street, Oxford, OX1 2EP.

2. ACCOUNTING POLICIES

Basis of accounting

The financial statements have been prepared under the historical cost convention and in accordance with the requirements of the Companies Act 2006 and in compliance with Financial Reporting Standard 102 and the Statement of Recommended Practice “Accounting and Reporting by Charities” issued by the Charity Commission (FRS102).

The charity controls The Friends Foreign Mission Association Trust Corporation (UK company no. 78392) as it appoints the directors of the Corporation. However this entity is not consolidated as it has no assets and its sole purpose is that land used by the charity in Lebanon is registered in its name.

Going concern

Since the last quarter of 2019, Lebanon has been witnessing severe events that have a significant impact on the fiscal, monetary and economic outlook along with their related adverse impact on the business community as a whole and the banking system in particular, mainly: social unrest and business disruption across the country, series of downgrades to the level of default ranking for private and sovereign credit risk by all major rating agencies, restrictions on cash withdrawals and movement of funds in foreign currencies, non-ability to transfer funds from local bank accounts in foreign currency to foreign accounts with correspondent banks, sharp devaluation of the unofficial currency exchange rate of LBP versus U.S. Dollar and creation of parallel markets with wide range of price variance, and the Lebanese Republic default on its Eurobonds due on March 9, 2020 and then the decision to discontinue payments on all of its outstanding USD-denominated Eurobonds. These adverse developments have raised significant incremental liquidity, exchange and credit risks and high level of uncertainties that could have an impact on the future financial performance, cash flows, and financial position of the School, if no appropriate mitigation measures have been taken by management.

However, management is not aware of any material uncertainties that may cast significant doubt upon the School’s ability to continue as a going concern. Therefore the financial statements continue to be prepared on the going concern basis. The School’s management will closely monitor all future developments in the Lebanese economy and take the appropriate mitigating measures accordingly. The trustees of QuIET are confident in the charity’s ability to continue trading for the next 12 months. The school holds significant cash-based reserves. In adopting the going concern basis for preparing the financial statements, the trustees have considered the organisation’s business activities, liquidity and strategy, as well as the risks to the Charity and the applicable controls.

Income

Income is recognised in the period in which the charity is entitled to receipt and the amount can be measured with reasonable certainty. School fees receivable are stated after deducting bursaries and other remissions. School fees received in advance are deferred and included in creditors.

20

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

2. ACCOUNTING POLICIES (continued)

Expenditure

Expenditure is included in the statement of financial activities when incurred and includes attributable VAT, which cannot be recovered. 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 a particular heading they have been allocated on a basis consistent with the use of the resources.

Expenditure comprises the following:-

The costs of charitable activities comprise expenditure on the charity’s primary purpose as described in the Trustees’ report, including the provision of education at the Brummana High School in Lebanon. Bursaries and grants payable are included in the statement of financial activities when approved and when the intended recipient has either received the funds or been informed of the decision to make the bursary or grant and has satisfied all related conditions. Bursaries and grants approved but not paid at the end of the financial year are accrued for.

Pension costs

Contributions to the Lebanese Government Provident Fund scheme are recognised in the statement of financial activities so as to spread the cost of pensions over employees’ working lives. Provision is made for expected liabilities at the year-end that have not been paid out.

Fund accounting

The restricted funds are monies raised for, and their use restricted to, a specific purpose, or donations subject to donor imposed conditions.

The tangible fixed assets fund represents the net book value of the tangible fixed assets of the charity. Such assets are essential to the charity being able to continue to fulfil its charitable objectives and, as such, do not represent assets which can be realised except in exceptional circumstances.

The general fund comprises those monies which may be used towards meeting the charitable objectives of the charity and applied at the discretion of the Trustees.

Tangible fixed assets

All assets costing more than US$200 and with an expected useful life exceeding one year are capitalised.

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life:

Improvements to premises 7% on cost
Renovation to buildings 7% on cost
Furniture and equipment 10% on cost
Computer equipment 25% on cost
Motor vehicles 10% on cost

In view of the unstable conditions in Lebanon, and the uncertainty of whether any future proceeds could be remitted to the charity, no value has been attributed in these financial statements to either the land on which Brummana High School stands or the original school buildings, apart from recent renovations and improvements which are capitalised. It is likely that the historic cost of the land and original buildings would not be significant to the overall financial statements. The buildings are insured for approximately US$ $10,000,000 plus $1,500,000 for their content.

Stocks

Stocks of books, publications, fuel, tuck shop supplies and sportswear are valued at the lower of cost or net realisable value.

21

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

2. ACCOUNTING POLICIES (continued)

Foreign currencies

The functional currency of Brummana High School is Lebanese Pounds, and the functional currency of the Charity is Sterling. The presentational currency of these accounts is Sterling since the accounts are filed with authorities in the UK. Monetary assets and liabilities in foreign currencies are translated into sterling at the official rates of exchange ruling at the balance sheet date which are derived from the official rate of 1 USD = LBP 1507.50. Transactions in foreign currencies are translated into sterling at the average official rate of exchange ruling over the period of the Statement of Financial Activities. Exchange differences are taken into account in arriving at net income.

Exchange differences arising on foreign currency net investments are taken into account in arriving at net income.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

A credit loss provision on cash has been calculated by multiplying the total amount of cash at banks with a Loss Given Default rate (45% applied in Lebanon) and a probability of default rate extracted from Moody’s report based on the classification/rating of Lebanese banks. In 2019 the probability of default rate used was 4.78%. For 2020, the rate has increased to 34.46% for balances with a maturity of 1 year, and 55.39% for balances with a maturity of 3 years.

Fixed asset investments

These consist of a long term subordinated loan accruing a fixed rate of interest which is recorded at amortised cost, and deposits held with Central Bank of Lebanon.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the charitable company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised at the transaction price.

Provisions

Provisions are recognised when the company has an obligation at the reporting date as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

22

QUAKER INTERNATIONAL EDUCATIONAL TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

3.

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

In particular, significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements are as follows

Credit Loss provisions

The measurement of expected credit losses is a function of the probability of default, the magnitude of the loss if there is a default and the exposure at default, and has been applied to the bank balances, investments and debtors relating to amounts held in Lebanon.

US Dollar Bank Balances in Lebanon

As further explained in note 18, there are currently significant restriction over the use of these balances. However they have continue to be presented as cash at bank and in hand as the Trustees are hopeful that in due course these restrictions will be lifted

Exchange rates for converting transactions and balance in Lebanese pounds to UK sterling

Monetary assets, liabilities, income, and expenditure have been converted using the official exchange rates. However due to the state of the Lebanese economy the unofficial rates which are available locally are significantly different. In the UK HMRC uses the official rates and given the difficulties in identifying what the unofficial rate may be at particular point in time, or its average for the year, the Trustees have used the official exchange rates for converting the figures for inclusion in these financial statements. If the unofficial exchange rate had been used the sterling value of the bank balances would have been significantly lower.

4. DONATIONS AND LEGACIES

Unrestricted
Funds
Restricted
Funds
£
£
Donations and grants
10,697
109,628
5.
INVESTMENT INCOME
Unrestricted
Funds
Restricted
Funds
£
£
Investment income
25,023
-
Income on bank deposits
778,548
-
Rental income
8,172
-
Credit losses provision
(1,795,301)
-
(983,558)
-		 Total
2020
£
120,325
Total
2020
£
25,023
778,548
8,172
(1,795,301)
(983,558)		 Total
2019
£
101,998
Total
2019
£
18,335
739,050
27,098
(254,759)
529,724

23

QUAKER INTERNATIONAL EDUCATIONAL TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

6. SCHOOL FEES AND RELATED RECEIPTS

Unrestricted
Funds
Restricted
Funds
Total
2020
£
£
£
Tuition, application and registration fees
5,632,624
-
5,632,624
Less: bursaries
(521,755)
-
(521,755)
5,110,869
-
5,110,869
Other school income:
Summer activities
6,947
-
6,947
Catering
72,322
-
72,322
Tuck shop
45,855
-
45,855
Bus fees
304,166
-
304,166
Bookshop and sportswear
112,363
-
112,363
Other revenues
58,257
-
58,257
599,910
-
599,910
Total
5,710,779
-
5,710,779
Bursaries amounting to £59,785 (2019: £35,161) were provided from restricted funds (see		 Total
2019
£
5,613,877
(520,348)

5,093,529
532,108
127,362
107,185
327,998
278,322
78,915
1,451,890
6,545,419
note 23).

7. TEACHING COSTS

Unrestricted
Funds
Restricted
Funds
£
£
Staff costs (note 12)
2,959,476
-
Travel and subsistence
292,583
-
Depreciation
247,477
-
Supplies and equipment
260,410
-
Repairs and maintenance
80,400
-
3,840,346
-		 Total
2020
£
2,959,476
292,583
247,477
260,410
80,400
3,840,346
 Total
2019
£
3,139,624
336,709
266,788
763,891
107,496
4,614,508

8. SUPPORT AND ADMINSTRATION OF THE SCHOOL

Unrestricted
Funds
Restricted
Funds
£
£
Staff costs (note 12)
977,796
-
Advertising, telephone and stationery
54,450
-
Travel and subsistence
149,436
-
Depreciation
247,477
-
Repairs and maintenance
34,458
-
Light, heat and fuel
162,066
-
Professional services
136,019
-
Insurance
27,320
-
Office, administration and miscellaneous
140,048
-
Bad debt provision
48,148
-
Governance costs (note 10)
29,381
-
2,006,599
-		 Total
2020
£
977,796
54,450
149,436
247,477
34,458
162,066
136,019
27,320
140,048
48,148
29,381
2,006,599		 Total
2019
£
875,182
74,407
170,919
266,788
46,070
189,530
139,169
29,763
186,031
71,488
28,371
2,077,718

24

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

9
GRANTS TO OTHER SCHOOLS
Unrestricted
Funds
Restricted
Funds
£
£
Ramallah Friends’ Schools, Palestine
-
53,082
10.
GOVERNANCE COSTS
Unrestricted
Funds
Restricted
Funds
£
£
Auditors’ remuneration:
Critchleys Audit LLP
Statutory audit services
5,040
-
Other services
6,335
-
Deloitte & Touche
Brummana High School audit services
16,492
-
Other statutory and legal costs
1,514
-
29,381
-
11.
NET (EXPENDITURE)/ INCOME
Unrestricted
Funds
Restricted
Funds
£
£
This is stated after charging:
Loss/(gain) on foreign exchange
404,977
-

Depreciation charged in period
494,954
-		 Total
2020
Total
2019
£
£
53,082
-
Total
2020
Total
2019
£
£
5,040
4,860
6,335
5,862
16,492
16,566
1,514
1,083
29,381
28,371
Total
2020
Total
2019
£
£
404,977
(483,163)
494,954
533,576

25

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

12. STAFF COSTS AND TRUSTEES’ EXPENSES

Staff costs during the year were as follows:
Wages and salaries
Back dated cost of living increase adjustment (note 22)
Social security costs
Other pension costs
Transport costs
The number of employees whose remuneration exceeded £60,000 was:
£70,000 - £80,000
£90,000 - £100,000
£110,000 - £120,000
£150,000 - £160,000		 2020
£
3,669,511
(214,191)
322,696
159,256
3,937,272
107,728
4,045,000
2020
No.
1
1
-
1		 2019
£
3,490,430
-
298,176
226,200
4,014,806
161,983
4,176,789
2019
No.
-
1
1
-

In addition, one of the higher paid employees was entitled to 1/12[th] of their salary via the staff termination indemnities fund (see note 22).

The average number of employees during the year, analysed by function, was as follows:

2020 2019
Number Number
Brummana High School, Lebanon
Teaching staff 164 155
Support 59 57
Administration 1 1
224 213
Key management compensation 2020 2019
£ £
332,675 262,061

No Trustee received any remuneration in respect of their services as a Trustee during the year (2019 - £nil).

Expenses were reimbursed to 5 (2019: 6) Trustees during the year as follows:

2020
£
Travel and accommodation expenses
934		 2019
£
2,799

13. TAXATION

Quaker International Educational Trust is a registered charity and therefore is not liable to income tax or corporation tax on income derived from its charitable activities, as it falls within the various exemptions available to registered charities. The charity is not registered for VAT.

26

QUAKER INTERNATIONAL EDUCATIONAL TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

14. TANGIBLE FIXED ASSETS

Improvements
to
Premises
Renovation
to
Buildings
Furniture
&
Equipment
Computer
Equipment
Motor
Vehicles
£
£
£
£
£
Cost
At 1 October 2019
1,084,148
4,445,537
1,085,012
632,865
23,271
Additions
26,139
194,889
35,839
131,883
-
Transfers
-
-
-
-
-
Disposals
-
-
-
-
-
At 30 September 2020
1,110,287
4,640,426
1,120,851
764,748
23,271
Depreciation
At 1 October 2019
771,138
2,208,322
703,848
556,301
2,909
Charge for period
50,776
332,916
77,115
30,628
3,519
Disposals
-
-
-
-
-
At 30 September 2020
821,914
2,541,238
780,963
586,929
6,428
Net book value
At 30 September 2020
288,373
2,099,188
339,888
177,819
16,843
At 30 September 2019
313,010
2,237,215
381,164
76,564
20,362		 Total
£
7,270,833
388,750
-
-
7,659,583
4,242,518
494,954
-
4,737,472
2,922,111
3,028,315

27

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

15.
FIXED ASSET INVESTMENTS
Subordinated bonds
Certificate of deposit with Central Bank of Lebanon
Interest accrued in the year
Allowance for expected credit loss
At 30 September 2020
16.
STOCKS
Books and publications
Sportswear
Tuck shop and kitchen supplies
Allowance for impairment
17.
DEBTORS
Tuition fees
Staff loans and other debtors
18.
CASH AT BANK AND IN HAND
Current accounts and cash in hand:
UK
Lebanon
Short term deposits with banks:
Lebanon LBP accounts
Lebanon USD accounts
Long term deposits with banks:
Lebanon LBP accounts
Lebanon USD accounts
Credit losses provision		 2020
£
236,975
291,362
17,169
(204,416)
341,090
2020
£
133,605
16,824
67,550
(28,322)
189,657
2020
£
479,605
51,554
531,159
2020
£
66,663
682,601
1,014,585
3,412,342
2,777,077
3,109,803
(1,817,733)
9,245,338		 2019
£
248,291
-
11,224
(5,340)
254,175
2019
£
62,684
14,693
29,562
(29,675)
77,264
2019
£
452,824
57,792
510,616
2019
£
20,317
655,749
1,390,448
3,825,555
3,332,833
2,926,073
(260,689)
11,890,286

A credit loss provision on cash has been calculated by multiplying the total amount of cash at banks with a Loss Given Default rate (45% applied in Lebanon) and a probability of default rate extracted from Moody’s report based on the classification/rating of Lebanese banks. In 2019 the probability of default rate used was 4.78%. For 2020, the rate has increased to 34.46% for balances with a maturity of 1 year, and 55.39% for balances with a maturity of 3 years.

For the Lebanon USD accounts there are currently severe restriction in Lebanon which means that these amounts cannot be withdrawn, apart from notional amounts.

28

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

19. CREDITORS: AMOUNTS FALLING DUE WITHIN CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR ONE YEAR
2020 2019
£ £
Tuition fees received in advance 964,314 1,765,550
Other creditors and accruals 290,188 445,559
Social security and other taxes 213,543 125,209
1,468,045 2,336,318
20. DEFERRED INCOME
2020 2019
£ £
Balance at 1 October 1,765,550 1,455,822
Amount released to incoming resources (1,765,550) (1,455,822)
Amount deferred in the year 964,314 1,765,550
Balance at 30 September 964,314 1,765,550
Deferred income comprises tuition fees received in advance.
21. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
2020 2019
£ £
Refundable enrolment fees 254,487 243,838
22. PROVISIONS FOR LIABILITIES AND CHARGES
At 1 Charges At 30
October and Utilised/ September
2019 exchange Released 2020
loss
in the
year
£ £ £ £
Staff termination indemnities fund 1,004,897
31,748		 (42,969) 993,676
Back dated cost of living increase 200,000
-		 (200,000) -
1,204,897
31,748		 (242,969) 993,676

Staff termination indemnities fund

This fund provides for Brummana High School’s end of service pension contribution liabilities for both teaching and non-teaching staff in accordance with the different Lebanese regulations for teachers’ pensions and for non-teachers’ pensions.

The School contributes a stipulated proportion of each employee’s salary to the appropriate Government pension fund; the Provident Fund for entitled teachers and the Social Security Fund for non-teachers. However, the School is responsible for meeting the extra pension earned by teachers in the Provident Fund who have been paid above the Government’s teachers’ pay scale. In addition, the School is responsible for the entire pension due to those teachers, for instance unqualified or foreign, who are not entitled to join the Provident Fund.

For other staff the School is responsible for the difference between the value of pension contributions already made to the Social Security Fund and a final calculation of the pension entitlement based on final salary and the number of years of service.

29

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

22. PROVISIONS FOR LIABILITIES AND CHARGES (continued)

Back dated cost of living increase

In Lebanon, there was a Government imposed back dated cost of living increase to teachers’ salaries. In previous years provision was made for extra amounts expected to be ultimately payable in excess of advances already made. However due to the current economic situation in Lebanon it is no longer probable that amounts will be paid and the provision has been remove. However there is a contingent liability for such amounts (previously estaimted at around £200,000)

23. RESTRICTED FUNDS

The income funds of the charity include restricted funds comprising the following unexpended balances held on trusts to be applied for specific purposes:

At 1
October
2019
£
Ramallah Friends’ Schools fund
54,162
Bursary fund
-
54,162
 Income
Expenditure,
Gains,
Losses &
Transfer
At 30
September
2020
£
£
£
49,843
(53,082)
50,923
59,785
(59,785)
-
109,628
(112,867)
50,923

Ramallah Friends’ School fund

The fund is for application towards grants payable to Ramallah Friends’ Schools, Palestine.

Bursary fund

The fund is for application towards the award of bursaries for students at Brummana High School and includes donations from the Brummana High School Cultural Society.

The movements on restricted funds for the previous year are set out below:

Expenditure, Expenditure,
At 1 Gains, At 30
October Losses & September
2018 Income
Transfer		 2019
£ £ £ £
Ramallah Friends’ Schools fund 26,865 27,297 - 54,162
Bursary fund - 35,161
(35,161)		 -
26,865 62,458
(35,161)		 54,162
24. TANGIBLE FIXED ASSETS FUND
2020 2019
£ £
At 1 October 2019 3,028,315 3,170,913
Net movement in the year (106,204) (142,598)
At 30 September 2020 2,922,111 3,028,315

The tangible fixed assets fund represents the net book value of the charity’s tangible fixed assets. Such assets are used in the day to day work of the charity and hence do not represent amounts which can be realised except in exceptional circumstances.

30

QUAKER INTERNATIONAL EDUCATIONAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2020

25. ANALYSIS OF NET ASSETS BY FUND

Current year (2020)
Fixed assets
Current assets
Creditors: amounts falling due within one
year

Creditors: amounts falling due after more
than one year
Provisions
Total net assets
Previous year (2019)
Tangible fixed assets
Current assets

Creditors: amounts falling due within one
year

Creditors: amounts falling due after more
than one year
Provisions

Total net assets		 General
Fund
£
341,090
9,915,231
(1,468,045)
(254,487)
(993,676)
7,540,113
254,175
12,424,004
(2,336,318)
(243,838)
(1,204,897)
8,893,126		 Tangible
Fixed
Assets
Fund
Restricted
Funds
£
£
2,922,111
-
-
50,923
-
-
-
-
-
-
2,922,111
50,923
3,028,315
-
-
54,162
-
-
-
-
-
-
3,028,315
54,162		 Total
£
3,263,201
9,966,154
(1,468,045)
(254,487)
(993,676)
10,513,147
3,282,490
12,478,166
(2,336,318)
(243,838)
(1,204,897)
11,975,603

26. CAPITAL COMMITMENTS

At the balance sheet date the charity had contracted capital commitments of £110,000 (2019: £nil).

27. RELATED PARTY TRANSACTIONS

One trustee made a donation of £39,407 ($50,000) to the charity (2019: £nil).