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2021-12-31-accounts

St. John of Jerusalem Eye Hospital

Company No: 3867950 Charity No: 1080185

ANNUAL REPORT

AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 DECEMBER 2021

Contents

Page
Legal and Administrative Information 1
Trustees’ Report 2
Statement of Trustees’ Responsibilities 9
Independent Auditors’ Report 10
Statement of Financial Activities 13
Income and Expenditure Account 13
Balance Sheet 14
Notes to the Financial Statements 15

Le al and Administrative Information g

Memorial Patron

The Lord Vestey DL

Registered and Principal Office

4 Charterhouse Mews London EC1M 6BB United Kingdom

Bankers

Barclays Bank Plc 1 Churchill Place, London E14 5HP United Kingdom

National Westminster Bank Plc 134 Aldersgate Street London EC1A 4JB United Kingdom

Independent Auditors

PricewaterhouseCoopers LLP 1 Embankment Place London WC2N 6RH United Kingdom

1

St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

Introduction

The Trustees present the Trustees’ report along with audited financial statements of St. John of Jerusalem Eye Hospital (the Company or SJJEH) for the year ended 31 December 2021. The financial statements have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by 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 and the UK Companies Act 2006.

St. John of Jerusalem Eye Hospital was formally incorporated as a private company limited by guarantee in October 1999 under the UK Companies House registration number 3867950. Its Memorandum and Articles of Association govern the Company. It is registered as a UK charity having the Charity Number 1080185.

The Charity’s operations are centralised in the Occupied Palestinian Territories where it runs Day Hospitals in Hebron and Gaza, and a Clinic in Anabta.

Objects of the Charity

The Company's objects are the relief of sickness and the preservation and protection of health, in particular, but not exclusively, by maintenance and development of St. John Eye Hospital in the Occupied Palestinian Territories or elsewhere and the clinical, teaching and research activities connected therewith.

Governance and Management

The sole member of the Company, since 31 March 2011, is St. John of Jerusalem Eye Hospital Group, (the Group) which appoints the Board of Directors/Trustees of the Company (the Board). The Board manages the business and affairs of the Company and usually meets three times a year with at least one meeting in Jerusalem. At its meetings, the Board reviews the performance of the Company and in particular the performance of the hospitals in Gaza, Hebron and Anabta. The Board also considers and approves the operational and capital budgets. The Steering Committee meets three times a year between the three Board meetings to maintain momentum on Board matters between meetings.

The Board is aware of the codification of Directors’ duties under the Companies Act 2006 and takes these duties into account in consideration of SJJEH's activities.

New Trustees are selected in consultation with the Board to maintain an appropriate balance of skills and experience. Trustees are appointed for a term of three years and may be reappointed for two further terms of three years and are not normally eligible for a further reappointment. An induction programme is in place for new directors.

The Board appoints the Chief Executive who reports to the Chairman and is accountable to the Board. The Chief Executive is Dr. Ahmad Maali, appointed from May 2019.

2

St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

The Trustees, who are also the directors for the purpose of company law, during the year and at the date of this report, are listed below:

• Digital and IT Committee

* Non-trustees are appointed to these committees for their expertise .

Each committee has terms of reference, which were updated in 2021.

The Board currently has the following Committees:

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St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

Review of the Year / Achievements and Performance against Objectives

Gaza

In partnership with the likes of Christian Blind Mission (CBM), Fred Hollows Foundation and the Federal Ministry of Economic Cooperation and Development (Germany) (BMZ), we managed to sustain our services in Gaza. In 2021, we have seen our major surgeries grow by 2% from the previous year. We also ran a Mobile Outreach unit in Gaza, which allowed us to reach the most vulnerable in the area to screen and educate on eye health.

In 2021, our Gaza Hospital saw over 33,900 patients, and performed 2,160 major operations. Our Gaza Mobile Outreach Programme has a screening element in isolated communities and homes. This programme in Gaza saw over 5,000 patients.

Anabta

a particularly high prevalence of diabetic retinopathy in this area of the West Bank. 27 major operation was undertaken at the Unit during the year.

Hebron

Our Hebron Hospital is a vital source of eye care in an area that is particularly affected by the movement restrictions in the West Bank. The hospital provides sight-saving treatments such as cataract and laser eye surgery to treat diabetic retinopathy, and serves the 640,000 people who live in and around Hebron, including the semi-nomadic Bedouins.

Our Hospital treated over 14,500 patients in 2021, including performing over 700 major operations.

Financial Review

The clinic continues to operate on two floors within the Red Crescent Society leased premises.

In 2021, our Anabta clinic witnessed an increase in the number of patients treated which was almost 16,500 outpatients at our Anabta Clinic.

Our Anabta Clinic is accessible for the 1 million residents in Anabta and surrounding Nablus, Tulkarem and Jenin. Those living in the area number amongst the poorest in the oPt. Many of its residents are refugees from Gaza, and it’s easily accessible to many who can’t journey to our other services. There is

The cost of the ongoing operations of the company in Gaza and the West Bank amounted to £2.7m (2020, £2.6m) while total patient and voluntary income amounted to £4.1m (2020, £3.0m). The overall net movement in funds was a surplus of £1.6m including exchange gains of £0.2m. The principal component of operating costs relates to personnel; 46% (2020, 46%). The Company remains heavily dependent on voluntary income which, in the main, is obtained as a result of the fundraising effort of other group companies.

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St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

Reserves

At 31 December 2021, reserves totalled £4,413k including restricted funds of £3k leaving £4,410k unrestricted. The Trustees review annually the need for reserves in line with the guidance issued by the Charity Commission. In undertaking this review, the Trustees take into account general reserves available elsewhere in the Group. The Trustees recognise the need to maintain, as the circumstances allow, the level of general reserves within the Company to ensure that it can continue to run efficiently with adequate working capital. This is intended to be achieved through a renewed focus on cost-cutting, revenue generation, the introduction of new sources of revenue, and enhanced fundraising activities to ensure financial resilience and sustainability for the future. Thus, unrestricted reserves need to be maintained to equate to at least six months running costs (equivalent to £1.4m).

Principal Risks & Uncertainties

A comprehensive risk management policy is in place along with a risk register of all clinical, operational, financial, external, political and governance risks. The risk register is continuously reviewed by the relevant committees with particular focus on residual risks.

A key risk which SJJEH faces continues to be financial, in particular by the impact, most recently, of the Covid-19 global pandemic. The position has been exacerbated by Brexit and the impact of the continuing reduction in value of Sterling against the Israeli Shekel, by changes to the statutory level of minimum wages in Israel, and also by the former US Administration’s decision to cut funding to East Jerusalem hospitals. SJJEH relies heavily on voluntary

income received mainly from donors in the Middle East, Europe, the United Kingdom and the United States. In the current global financial situation, it remains a great challenge to continue to attract core funding from existing and new sources. The fundraising strategy includes a focus on endowment and legacy giving in order to mitigate this risk as well as a focus on major gifts for core costs.

Liquidity is a recurring issue, especially with the prolonged payment pattern of the Palestinian Authority for its working capital needs. SJJEH therefore sets aside a portion of the investment portfolio as a cash deposit, in order to ensure meeting the working capital needs.

International currency exchange movements are an additional risk. It should be recognised that exchange gains do not represent realisable income which are capable of being utilised by SJJEH, as they largely reflect the translation into Sterling of the Israeli Shekel value of the Hospital premises.

Operationally, patient and staff access to Jerusalem is crucial to the continuation of our ability to provide eye care services in the occupied Palestinian territories. Working in a volatile region has inherent risks. Gaza has its own risks. The situation could escalate at any time as instability and strife continue to affect the neighbouring countries, a particular current concern.

Going concern

Since March 2020 and the on-set of Covid-19 in Israel and the occupied Palestinian Territories (oPt), the Board of Trustees and Management have been working on flexible plans, both operational and financial, to seek to secure the continued viability of the organisation.

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St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

We currently remain confident about our future, but these are very challenging and unprecedented times for SJJEH and society in general; and are likely to remain so for quite some time to come. We plan to work closely with all our global partners and supporters to seek to ensure that we continue to serve our patients in the most efficient and safe manner.

Detailed, yet adaptable, business plans have been prepared, and financial budgets and cash flow models are aligned to those plans. These plans are clearly dependent upon a variety and number of key assumptions, some of which are interrelated. For example, national and local Government decisions (such as measures taken by Governments to mitigate the impacts of the COVID 19 global pandemic on public health), travel and border restrictions, social distancing, capacity in our hospitals, the demand from our patients, our ability (and that of the PA) to obtain funding and donations, our fixed and variable cost structure; continued financial support from Group undertakings; to note just a few. Further details of the Company’s principal risks and uncertainties are set out in the Trustees’ report.

The plans and models have been prepared for the period to December 2023, which is a period of at least 12 months from the date of approval of the financial statements. For the Board of Trustees to have a reasonable expectation of the Company’s financial viability to December 2023, the Trustees have also identified several challenging, yet reasonably plausible, downside scenarios based on information currently identified as a result of the impact of Covid-19 (sensitivity analysis). Sensitivity analyses and modelling have been performed on the key assumption alongside the financial effects thereon.

The Trustees continue to review and will implement any possible mitigations in order to

seek to reduce the financial impact of these downside scenarios – maintaining a balance between supporting the activity that is crucial to delivering the objects of the charity, whilst ensuring the long-term financial sustainability of the Company.

Under these current downside scenarios, with no further mitigations which may be available to the Company, the Trustees’ project to have sufficient liquidity through the period to December 2023.

Further details of the above are set out in Note 1 to the financial statements.

After consideration of the detailed, yet adaptable, business plans, financial budgets, cash flow modelling aligned to those plans and scenarios, and the overlaid sensitivity analyses, the Trustees consider that the Company has adequate resources to continue in operational existence for the foreseeable future, being a minimum period of at least 12-months from the date when the financial statements are approved.

Based on all of the above, the Board of Trustees are confident in the Company’s ability to remain as a going concern and have, therefore, prepared the financial statements on a going concern basis of accounting.

Nevertheless, the Trustees fully acknowledge that there is a level of uncertainty, which is likely to persist for some time, given the key assumptions and the financial modelling referred to above.

Remuneration policy

All roles within the Company are evaluated in order to determine where it fits on our pay scale. The salaries within the scale are determined by the market rates for an equivalent position. In exceptional cases, where the market information supports it, salaries may be above the top of the

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St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

band. Each year, the payroll budget is reviewed, based on legislative, statutory and market changes, using a range of sources and taking account of affordability.

Management consult with the finance, pay and renumeration, and HR committees of the board, and a pay review proposal is submitted to the board who makes the decision on the proposal.

Controls and Clinical Governance

Great emphasis continues to be placed covering risk management - clinically, operationally and financially.

The Clinical Governance Committee continues its regular review of all medical and nursing policies and protocols in addition to instigating and reviewing clinical audits and investigating clinical complications and 'near misses'.

The Board engages independent firms of accountants to carry out internal audit programmes on the financial controls in operation within the Company’s activities.

Outreach

Will continue with our very successful Diabetic Retinopathy Screening Programme at the refugee camps in the Gaza Strip.

Capacity

Complex surgeries will continue to be provided in Gaza especially with the opening of the second theatre.

Finance

Unfortunately, we are operating in a politically volatile time and this has severely impacted our finances in the past few years. The unrest within the region and the shift in the international focus to other immediate humanitarian interventions has affected the level of donations received by the hospital.

Pre-Brexit period has caused a sharp depreciation in the Pound Sterling against all currencies, including the Israeli Shekel. The US Dollar is also depreciating against the Israeli Shekel. Thus, the hospital was affected by such movements in exchange rates as a substantial proportion of our voluntary donations are received in these currencies

Public Benefit

Plans for 2022

Training

Doctors and Nurses from Gaza will receive training in different subspecialties at our hospital in Gaza, enabling the team to provide comprehensive services.

The Trustees have given due regard to the Charity Commission's General Guidance on public benefit when planning the charity's activities.

Our Annual Report sets out our activities, achievements and performance during the year, which are directly related to the objects and purposes for which SJJEH exists. SJJEH achieves its principal objectives through the delivery of services to members of the public in the West Bank and Gaza without regard for any distinction by race, class or religion.

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St. John of Jerusalem Eye Hospital Trustees’ Report For the year ended 31 December 2021

The Public Benefit from SJJEH’s activities is:

8

St. John of Jerusalem Eye Hospital Statement of Trustees’ Responsibilities For the year ended 31 December 2021

Statement of Trustees’ Responsibilities

The Trustees (who are also directors of St. John of Jerusalem Eye Hospital for the purposes of company law) are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and regulation.

Company law requires the Trustees to prepare financial statements for each financial year. Under that law the Trustees have prepared the financial statements in accordance with United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law (United Kingdom Generally Accepted Accounting Practice).

Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of the affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

• select suitable accounting policies and then apply them consistently;

• observe the methods and principles in the Statement of Recommended Practice: Accounting and Reporting by Charities (2019);

• make judgments and estimates that are reasonable and prudent;

• state whether applicable UK Accounting Standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the financial statements; and

• 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 adequate accounting records that are sufficient to show and explain the charitable company’s transactions and disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

In so far as the Trustees are aware at the time of approving our Trustees’ Annual Report: (a) there is no relevant audit information of which the company’s auditors are unaware; and (b) the Trustees have taken all the steps that he ought to have taken as a trustee in order to make himself aware of any relevant audit information and to establish that the company’s auditors are aware of that information.

The Trustees’ (Directors’) report has been prepared in accordance with the special provisions relating to small companies within Part 15 of the Companies Act 2006.

The Trustees’ Report on pages 2 to 9 was approved by the Trustees and signed on their

behalf by: Sir Andrew Cash

Chairman, Board of Trustees, St. John of Jerusalem Eye Hospital Company No. 3867950 23 June 2022

9

Independent auditors’ report to the members of St. John of Jerusalem Eye Hospital

Report on the audit of the financial statements

Opinion

In our opinion, St. John of Jerusalem Eye Hospital’s financial statements (the “financial statements”):

We have audited the financial statements, included within the Annual Report and Financial Statements (the “Annual Report”), which comprise: the balance sheet as at 31 December 2021; the statement of financial activities and the income and expenditure account for the year then ended; and the notes to the financial statements, which include a description of significant accounting policies.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We remained independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions relating to going concern

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 the date on which the financial statements are authorised for issue.

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.

However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the charitable company’s ability to continue as a going concern.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Reporting on other information

The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The trustees are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance 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 an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of 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 based on these responsibilities.

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Independent auditors’ report to the members of St. John of Jerusalem Eye Hospital

Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.

Trustees’ Report

In our opinion, based on the work undertaken in the course of the audit the information given in the Trustees’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and the Trustees’ Report has been prepared in accordance with applicable legal requirements.

In addition, in light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we are required to report if we have identified any material misstatements in the Trustees’ Report. We have nothing to report in this respect.

Responsibilities for the financial statements and the audit

Responsibilities of the trustees for the financial statements

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 in accordance with the applicable framework and for being satisfied that they give a true and fair view. The trustees are also responsible for such internal control as they 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.

Auditors’ 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 auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

Based on our understanding of the charitable company and the environment in which it operates, we identified that the principal risks of noncompliance with laws and regulations related to the Companies Act 2006 and the Charities Act 2011 and relevant regulations made or having an effect thereunder, including The Charities (Accounts and Reports) Regulations 2008, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered the direct impact of these laws and regulations on the financial statements. We evaluated the incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) by the trustees and those responsible for, or involved in, the preparation of the underlying accounting records and financial statements and determined that the principal risks were related to the posting of inappropriate journal entries to conceal misappropriation of assets. Audit procedures performed by the engagement team included:

• Testing journals entries where we identified particular fraud risk criteria.

• Obtaining independent confirmations of cash balances at the year end.

• Testing estimates and judgements made in the preparation of the financial statements for indicators of bias.

• Reviewing meeting minutes, and significant contracts and agreements.

• Holding discussions with the trustees and management to identify significant or unusual transactions and known or suspected instances of fraud or non-compliance with laws and regulations.

• Assessing financial statement disclosures, and agreeing these to supporting evidence, for compliance with applicable laws and regulations.

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in financial statements. Also, the risk of not detecting a material

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Independent auditors’ report to the members of St. John of Jerusalem Eye Hospital

misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations or through collusion.

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

Use of this report

This report, including the opinions, has been prepared for and only for the charity’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Entitlement to exemptions

Under the Companies Act 2006 we are required to report to you if, in our opinion, the trustees were not entitled to: take advantage of the small companies’ exemption in preparing the Annual Report; and take advantage of the small companies exemption from preparing a Strategic Report. We have no exceptions to report arising from this responsibility.

Andrew Lowe (Senior Statutory Auditor) For and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors London 23 June 2022

Other required reporting

Companies Act 2006 exception reporting

Under the Companies Act 2006 we are required to report to you if, in our opinion:

We have no exceptions to report arising from this responsibility.

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St. John of Jerusalem Eye Hospital Statement of Financial Activities For the year ended 31 December 2021

Unrestricted Restricted Total Total
Funds Funds Funds Funds
2021 2021 2021 2020
Notes £'000 £'000 £'000 £'000
Income
Income from donations and legacies 3 63 2,752 2,815 1,728
Income from charitable activities 4 1,295 - 1,295 1,319
Total income 1,358 2,752 4,110 3,047
Expenditure
Expenditure on charitable activities (2) (2,727) (2,729) (2,510)
Other expenditure (17) - (17) (40)
Total expenditure 5 (19) (2,727) (2,746) (2,550)
Net income 1,339 25 1,364 497
Transfers between funds 10,11 65 (65) - -
Exchangegains on overseas activities 227 - 227 147
~~Net Movement in Funds~~ 1,631 (40) 1,591 644
Fund balances brought forward at 1 January 2,779 43 2,822 2,178
Fund balances carried forward at 31 December 12 4,410 3 4,413 2,822

All gains and losses recognised in the year are included in the Statement of Financial Activities. All of the above results are derived from continuing activities.

Income and Expenditure Account for the year ended 31 December 2021

2021 2020
£'000 £'000
Income 4,110 3,047
Expenditure
~~Net income~~		 (2,746)
1,364		 (2,550)
497

The income and expenditure account excludes the exchange gains on overseas operations shown in the Statement of Financial Activities.

The accounting policies and the notes on pages 15 to 23 form part of these financial statements.

13

St. John of Jerusalem Eye Hospital Company 3867950 Balance Sheet as at 31 December 2021

Company 3867950
Balance Sheet as at 31 December		 2021
Note 2021 2020
£'000 £'000
Fixed Assets
Tangible assets 7 2,755 2,673
Total Fixed Assets 2,755 2,673
Current Assets
Stocks 80 97
Debtors 8 1,875 1,249
Cash at bank and in hand 1,831 588
Total Current Assets 3,786 1,934
Creditors: Amounts falling due within
one year 9 (2,128) (1,785)
Net Current Assets 1,658 149
Total Assets Less Current Liabilities 4,413 2,822
Net Assets 4,413 2,822
The Funds of the Charity
Restricted income funds 10 3 43
Unrestricted income funds 11 4,410 2,779
Total Charity Funds 12 4,413 2,822

The accounting policies and the notes on pages 15 to 23 form part of these financial statements.

The financial statements on pages 13 to 23 were approved by the Trustees and signed on their behalf by:

………………………………… ………………………………… Sir Andrew Cash Christopher Hoult Chairman, Board of Trustees Treasurer

Date: 23 June 2022

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St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

1 Principal accounting policies

a Basis of preparation

The financial statements of St. John of Jerusalem Eye Hospital ( the "Charity" or the "Company") have been prepared on the going concern basis, under the historical cost convention, with items recognised at cost or transaction value unless otherwise stated in the relevant note(s) to these financial statements. The financial statements have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) and the Companies Act 2006.

The Company's objects are the relief of sickness and the preservation and protection of health, in particular, but not exclusively, by maintenance and development of St. John Eye Hospital in the Occupied Palestinian Territories or elsewhere and the clinical, teaching and research activities connected therewith

The ultimate parent undertaking and controlling party is St. John of Jerusalem Eye Hospital Group, a company incorporated in the United Kingdom under registration number 7355619. It is registered as a charity under the number 1139527 and has a registered Office at 4 Charterhouse Mews, London, EC1M 6BB. St. John of Jerusalem Eye Hospital Group is the parent undertaking of the largest group of undertakings to consolidate these financial statements at 31 December 2021. The consolidated financial statements of St. John of Jerusalem Eye Hospital Group are available from 4 Charterhouse Mews, London, EC1M 6BB.

Going Concern

BACKGROUND

In assessing the going concern position of the Charity, the Board of Trustees have considered the Company’s projected activities, financial budgets, cash flows and liquidity for a period to December 2023, which is a period of at least 12 months from the date of approval of the financial statements.

Based on the Company’s cash flow projections, and support from Group undertakings, the Board of Trustees have adopted the going concern basis of accounting in preparing these financial statements.

IMPACT OF COVID-19

The first case of COVID 19 was confirmed in Israel on 22nd February 2020 and the first case was confirmed in the occupied Palestinian territories on 6th March 2020. The Palestinian Authority (PA) declared a state of emergency and imposed a lockdown on all Palestinians, including severe movement restrictions. Beginning the 11th March 2020, Israel began lockdown measures, including enforcing social distancing and other rules to limit the spread of infection.

The country was hit with a second COVID 19 wave in September 2020 and, as a result, the Israeli Authorities imposed a lockdown on the 18th September 2020 for 4 weeks. As for the PA, no lockdown was imposed, except for specific areas with a high incidence of COVID 19. The authorities kept all of these measures and restrictions under regular review. On 18th December 2020, The Palestinian Authority announced a new set of strict nationwide measures aimed at slowing down the rapid spread of the COVID 19 pandemic across Palestine. This was followed by similar measures by the Israeli authorities.

The lockdown continued until 31st January 2021 after which both authorities started easing the restrictions on movements and allowed some businesses to reopen gradually. By May 2021, most of the restrictions were cancelled by the local authorities. From the beginning of August 2021, the country witnessed an increase in infected cases to reach a daily average of 3,500 cases. In early December 2021, the first confirmed cases of the Omicron variant were detected in Israel. For the first time since the skies were closed at the start of the coronavirus pandemic in March 2020, Israel’s borders were fully reopened to foreigners beginning 1st March 2022.

The emergence of COVID 19 and reactions to it have had, and continue to have, a profound effect on domestic and global economies, organisations and society at large. As a result of all the restrictions imposed by the authorities in 2020, the Company experienced a reduction in clinical activities which resulted in a significant decline in patient related income. However, the Company was back to normal working levels and patients’ activities since the beginning of 2021. However, the PA has been facing major financial difficulties that have resulted in the inability of their ministry of health to make sufficient, regular and timely payments to the Company during 2020 and 2021. The Company has not experienced a severe decline in voluntary income receipts and income has been within the normal average rates.

TRUSTEES’ ACTIONS

To seek to minimise the financial impact of the pandemic, the Company carried out the following actions during 2020 and 2021:

As for additional and new sources of finance, the hospital received US$150k from the Israeli Government as a grant for returning employees to work. Additionally, the hospital received US$75k from the Jerusalem Fund. Moreover, the Priories of St John have reassured the Trustees of their commitment to continue supporting the Company.

BUSINESS PLAN

In order to assess, for example, the use of the going concern assumption, Management and the Trustee Board have produced a detailed, yet adaptable, business plan that considers projected activity, the related financial budgets, cash flows and liquidity of the Company covering the period to December 2023.

15

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

KEY ASSUMPTIONS

The business and financial plans incorporate the following key assumptions:

SENSITIVITY ANALYSIS

Management and the Trustee Board have considered the impact on projected activities, budgets, and cash flows of several challenging, yet reasonably plausible, downside scenarios such that the key assumptions are not met, or able to be met, in whole or in part. These include, for example, restrictions in supply of, or demand for, patient services; and reductions in income through voluntary income and fundraising targets not being achieved, beyond those considered in the current plans.

The Trustee Board has also sought to identify certain mitigating actions that could be implemented in order to provide additional liquidity or reduce cash outflows so as to ensure that the Company can maintain sufficient liquidity over the period to December 2023. The success of such measures, whilst being identified and achievable based on current advice, may not necessarily provide liquidity to the degree required or within the required timescales. As such, the Board of Trustees fully acknowledge that there is a level of uncertainty, which is likely to persist for some time, given the key assumptions and the financial modelling referred to above.

CONCLUSIONS

Having assessed the combination of all these various options and the financial support from Group undertakings, the Trustee Board has a reasonable current expectation that the Company has adequate resources to continue in operational existence for the foreseeable future, being a period of at least 12 months from the date of approval of the financial statements. For these reasons, the Trustee Board has adopted the going concern basis of accounting in the preparation of these financial statements. Accordingly, these financial statements do not include any adjustments to the carrying amount or classification of assets and liabilities that would result if the Company were unable to continue as a going concern.

16

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

b Foreign currencies

The Charity's functional and presentational currency is pounds sterling. Transactions in foreign currencies are recorded at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities at the year end are translated at the rate ruling at the balance sheet date. Results of overseas operations are translated at the average rate for the period and their assets and liabilities at the balance sheet rate. All exchange differences are dealt with in the Statement of Financial Activities. Exchange differences on the translation of the assets and liabilities of overseas operations are included as other recognised gains and losses. All other exchange differences are included as incoming resources or resources expended as appropriate. The exchange rate of the British Pound to the Shekel at 2021 year-end was 4.2031 (2020, 4.3919), while the average rate for 2021 was 4.4458 (2020, 4.4131).

c Income recognition

Donations and other income are recognised in the financial statements on a receivable basis. Grants are recognised when the entitlement to the grant is confirmed. Legacies are recognised when the entitlement arises, being the earlier of the Charity being notified of the impending distribution or the legacy being received. Income from charitable activities is accounted for when earned. Subsidies and exemptions in respect of medical services provided without charge are shown as a deduction from gross income.

d Volunteers

The value of services rendered by medical volunteers is not recognised in these financial statements

e Resources expended and basis of allocation of costs

Resources expended are accounted for on an accruals basis and have 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 use of resources. The irrecoverable value added tax is included with the item of expense to which it relates.

f Costs of charitable activities

These represent the costs of providing the medical and training services of the hospital and its clinics including both direct expenditure and the associated support costs.

g Governance costs

These comprise costs attributable to the overall management of the Charity's affairs and compliance with constitutional and statutory requirements.

h Cash flow statement exemption

The Charity has taken advantage of the exemption in FRS 102 from preparing a statement of cash flows, on the basis that it is a qualifying entity.

i Rentals

The costs in respect of rentals are charged to the Statement of Financial Activities on a straight line basis over the contract period.

j Liquid resources

Liquid resources are cash, time deposits, and certificates of deposit, in addition to cash at bank and in hand held in current accounts with UK, Israeli and Palestinian Banks.

17

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

1 Principal accounting policies (continued)

k Pension and other end of service costs

The amount charged in the Statement of Financial Activities in respect of pension costs is the contributions payable in the year on an accruals basis in respect of defined contribution and money purchase pension arrangements. Other end of service benefits are accrued as earned on an undiscounted basis.

l Taxation

The Charity is entitled to certain tax exemptions on income and gains from investments, and surpluses on any trading activities carried on in furtherance of its primary objectives, if these gains and surpluses are applied solely for charitable purposes.

m Tangible assets and depreciation

Cost of tangible assets includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.

Donated fixed assets are brought into account at an estimate of their market value at the time of acquisition and, thereafter, depreciated on the bases set out below. The costs of minor additions to fixed assets under £500 are expensed in the year in which they are incurred. Impairment reviews are carried out if there is an indication that the recoverable amount of an asset is below its net book value.

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

expected useful life on a straight line basis, as follows:
Buildings - 2.5% per annum
Building improvements - 10% per annum
Medical equipment - 15% per annum
Motor vehicles - 20% per annum
Other equipment - 20% per annum
Fixtures and fittings - 6% per annum
Computer equipment - 33% per annum
The holding values and estimated useful lives of assets are regularly reviewed for impairment and, where deemed appropriate, are
written down.

On disposal of an item of tangible assets, the difference between the disposal proceeds and its carrying amount is recognised in other hospital income in note 4.

n Funds

Restricted funds are funds which are subject to specific conditions imposed by the donors. Unrestricted funds are generally available for the Charity to carry out its charitable objectives.

General reserves are unrestricted funds available to be used at the discretion of the Board of Trustees for the furtherance of the charitable objectives of the Charity and which have not been designated for any other purpose.

Transfers between funds represent tangible assets purchased with restricted donations and used for daily hospital operations.

Stocks comprise hospital medical stores and supplies stated at the lower of cost or net realisable value using the FIFO method.

p Estimates and assumptions The preparation of the financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenditure during the reporting period. Although these amounts are based on Trustees' best estimates of the amount, events or actions may mean that actual results ultimately differ from those estimates, and these differences may be material. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the change takes place if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Exchange rates are fundamental to the uncertainties. Mainly the impact of subsequent adverse movements between the exchange rates of the reporting and the operative currencies which would potentially affect, to some extent, the operating capability notwithstanding the enhanced but unrealisable balance sheet value of non UK fixed assets.

The Charity provides against receivables by making judgements based on experience regarding the level of provision required to account for potentially uncollectible receivables.

The Charity is a company limited by guarantee and has no share capital (Company No.3867950 and Charity No. 1080185) and has a registered Office at 4 Charterhouse Mews, London, EC1M 6BB. The liability of each member in the event of winding up is limited to £10. The Company owns two £1 shares being all the issued shares in The St. John of Jerusalem Eye Hospital (Palestine) Limited, which has not traded since incorporation.

has not traded since incorporation.
3 Income from donations and legacies Unrestricted Restricted 2021 Unrestricted Restricted 2020
£'000 £'000 £'000 £'000 £'000 £'000
Donations 10 2,752 2,762 22 1,693 1,715
Donations in kind 53 - 53 13 - 13
63 2,752 2,815 35 1,693 1,728

18

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

come from charitable activities 2021 2020
£'000 £'000
Total Total
Outpatient income 1,085 958
Surgical income 1,013 873
Less: Patient Relief (804) (512)
Net Patient Related Income 1,294 1,319
Other Hospital income 1 -
1,295 1,319

4 Income from charitable activities

Patient Relief represents subsidies and exemptions to cover the value of medical services rendered when payment is waived by the Company where funding is not available from the relevant authorities and where the patients are unable to pay any balance owing. All of the above income comprises unrestricted funds.

5 Total expenditure a Resources expended

Costs of Costs of
charitable charitable Governance Governance
activities activities Costs Costs Total Total
2021 2020 2021 2020 2021 2020
£'000 £'000 £'000 £'000 £'000 £'000
Personnel costs (note 6) 1,270 1,178 - - 1,270 1,178
Medical costs 851 801 - - 851 801
Establishment costs 125 140 - - 125 140
Depreciation (note 7) 293 289 - - 293 289
Office expenses 24 26 - - 24 26
Travel and subsistence 9 7 - - 9 7
Auditors' remuneration 3 6 16 16 19 22
Other professional fees 57 49 1 - 58 49
Other costs 35 16 - - 35 16
Finance costs 62 22 - - 62 22
2,729 2,534 17 16 2,746 2,550
Support costs included above 221 184 - - 221 184

Total resources expended in 2020 of £2,550,000 comprise £965,000 for unrestricted funds and £1,585,000 for restricted funds.

2021 2020
Support costs comprise: £'000 £'000
Personnel costs 43 37
Establishment costs 63 70
Depreciation 29 29
Office expenses 24 26
Finance costs 62 22
221 184

19

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

5 Total resources expended (continued)

b
2021
2020
Auditors' remuneration (excluding value added tax):
£
£
External Audit
13,476
13,702
Other servicesprovided byexternal auditors
2,909
4,688
16,385
18,390

6 Employee information

a Staff numbers

The average monthly number of employees, including part time staff calculated on a full-time equivalent basis, analysed by function was:

2021 2020
Number Number
Medical and nursing 62 60
Support services 14 13
Administration 4 5
80 78

b Staff costs

Staff costs
2021 2020
£'000 £'000
Wages and salaries 1,216 1,124
Pension costs 55 55
Other related costs - net (1) (1)
1,270 1,178

c Emoluments of employees

There are no employees who received employee benefits of more than £60,000 (2020: none).

d Remuneration received by key management personnel

This represents salaries and other benefits received by senior management personnel within their course of employment in managing the daily operations of the Charity. The amount received by 3 staff members (2020: 3) amounted to £135,000 (2020: £113,000).

20

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

**7 ** Tangible assets
Buildings &
Medical
Other
Improvements
Equipment
Assets
Total
Cost
£'000
£'000
£'000
£'000
Balance at 1st January 2021
2,290
3,477
443
6,210
Additions
2
202
53
257
Exchange differences
103
167
23
293
Balance at 31st December 2021
2,395
3,846
519
6,760
Accumulated Depreciation
Balance at 1st January 2021
327
2,895
315
3,537
Charge for the year
59
197
37
293
Exchange differences
18
141
16
175
Balance at 31st December 2021
404
3,233
368
4,005
Net Book Value
At 31st December 2021
1,991
613
151
2,755
At 31st December 2020
1,963
582
128
2,673

Other Assets comprise furniture and fixtures, vehicles, and office equipment.

8 Debtors

Debtors
2021 2020
Amounts fallingdue within oneyear £'000 £'000
Trade debtors 205 558
Donations receivable - 265
Prepayments and accrued income 16 17
Intercompany balance 1,654 409
1,875 1,249

Intercompany balance includes cash advances and transfers to the Israeli entity (Amuta) from the Charity.

9 Creditors

Amounts falling due within one year 2021 2020
£'000 £'000
Trade creditors 141 63
Taxation and social security - 7
Accruals 396 372
Retirement benefits 1,587 1,336
Holiday payaccrual 4 7
2,128 1,785

Accrued retirement benefits mainly represent amounts payable in line with Palestinian law when staff leave the employment of the Company. Such amounts are accrued when earned, based on current monthly salaries and periods of service. Also included in the balance are provident schemes.

21

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

10 Restricted income funds

Purchase of
At 1st Incoming Costs of Tangible At 31
January Resources charitable Fixed December
2021 activities Assets 2021
£'000 £'000 £'000 £'000 £'000
Emir of Qatar - 365 (365) - -
Fred Hollows Foundation - 905 (905) - -
Capital Funds - 65 - (65) -
Emergency Funds - 149 (149) - -
BMZ Fund 40 922 (962) - -
Poor Patient Fund 3 346 (346) - 3
43 2,752 (2,727) (65) 3
Purchase of
At 1st Incoming Costs of Tangible At 31
January Resources charitable Fixed December
2020 activities Assets 2020
£'000 £'000 £'000 £'000 £'000
Emir of Qatar - 1,107 (1,107) - -
Capital Funds - 66 - (66) -
Emergency Funds - 118 (118) - -
BMZ Fund - 282 (242) - 40
Poor Patient Fund 1 3 (1) - 3
1 1,576 (1,468) (66) 43

11 Unrestricted income funds

2021
2020
£'000
£'000
Opening balance
2,779
2,177
Net movement in funds excluding transfers
1,566
536
Transfer from restricted funds
65
66
Total Unrestricted Funds
4,410
2,779

Transfers represent amounts released from restricted funds for the purchase of tangible assets. Unrestricted Funds includes designated fixed asset funds of £2,755k (2020: £2,673k)

12 Total charity funds

Unrestricted
Unrestricted
Restricted
Restricted
Total
Total
Funds
Funds
Funds
Funds
Funds
Funds
Analysis by type of asset and liability
2021
2020
2021
2020
2021
2020
£'000
£'000
£'000
£'000
£'000
£'000
Tangible assets
2,755
2,673
-
-
2,755
2,673
Net current assets
1,655
106
3
43
1,658
149
4,410
2,779
3
43
4,413
2,822

22

St. John of Jerusalem Eye Hospital Notes to the Financial Statements For the year ended 31 December 2021

13 Trustees' remuneration

The Trustees receive no remuneration.

All expenses incurred by the Trustees were paid by the parent charitable company.

14 Financial Instruments

The Company has taken advantage of the exemption which is available under FRS 102 1.12 ( c), (relating to sections 11 and 12 of the standard) as a wholly owned subsidiary not to disclose the

15 Related parties transactions

The sole member of the Company, since 31 March 2011, is St. John of Jerusalem Eye Hospital Group, which appoints the Board of Directors/Trustees of the Company.

During the year, the Chairman of the Charity, Sir Andrew Cash, was also the chairman for St. John of Jerusalem Eye Hospital Group.

The Company owns two £1 shares being all the issued shares in The St. John of Jerusalem Eye Hospital (Palestine) Limited (company number: 6365210), which has not traded since incorporation.

23