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2023-08-31-accounts

THE DEAN CLOSE FOUNDATION

ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023

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THE DEAN CLOSE FOUNDATION

CONTENTS FOR THE YEAR ENDED 31 AUGUST 2023

REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023

Page
Trustees, officers and advisers 1-3
Report ofthe Trustees 4-17
Independent Auditor’s Report 18-21
Consolidated statement of financial activities 22
Balance sheets 23
Consolidated cash flow statement 24
Notestothefinancialstatements 25—50

: “THE DEAN CLOSE FOUNDATION TRUSTEES, OFFICERS AND ADVISERS FOR THE YEAR ENDED 31 AUGUST 2023

The Directors of the Company, who are referred to throughout these financial statements as the Trustees, are listed below, along with the Members of the Company and the main sub-committee.

President The Lord Ribeiro

Council of Members The Rev'd M Allen, BA The Rev'd S Austen BSc, MA, Dip.Min (retired 8 June 2023) Mrs J Bee, BSc (appointed 5 October 2022) Mrs V Beevers (appointed 22 December 2022) Mrs S Bennett, BA (appointed 23 June 2023) M Bowen H Bradby BA, MA S Bullingham MSc, BSc R Byrd, FCA, FCCA Brig. M T Cansdale, MBE, BA (appointed 18 May 2023) Mrs K A Carden BA, MPhil M J Cartwright, BA, FCA (retired 21 January 2023) The Rev'd J Chaffey, MA, BA Mrs E Clark (appointed 8 May 2023) Mrs S Clayton The Rev'd R M Coombs, BSc, MA Mrs H S L Daltry, BA Mrs N C Davies, BA (appointed 22 December 2022) B Davies OBE Mrs R Dick, BA, ACA (retired 24 March 2023) Mrs C Dowler CSS Drew, MA J Drew, Meng (retired 21 January 2023) 1A Duffin, BCom, FCA Mrs R Eden Mrs C Fletcher MA S Foster BA L C Glaser MA, ACA (appointed 23 June 2023) J Hall B Harding, MBA P Harvey, MA Mrs T Haynes, BSc (Hons) R Hilldick-Smith, MEng, CEng, IMechE Mrs A Hillman, BA Mrs S L Hirst, BEd S W Holliday, MA M A Hughes BSc (appointed 21 January 2023) AJ Hunt A Judge Miss R A Keens BEd | Kilpatrick, BA Med (appointed 5 October 2022) Mrs F Knight BA R Lewis, BSc AVM (Ret’d) R Lock, CBE, BSc The Rev'd R Mackay D Main, FCA, FCCA Mrs A Marsden, BSc MA G McDonald, B.Comm B. Acc J Moos, Mcomp (Hons) CCP MCIS Mrs C Morris (appointed 22 December 2022) D Mullins, BSc, FCA

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° ;

THE DEAN CLOSE FOUNDATION TRUSTEES, OFFICERS AND ADVISERS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2023

Council of Members (continued) Mrs P G Napier B Nicholas, MA Mrs C J Pack, MRICS The Revd. H Palmer BA M Philip-Sorensen Mrs K Pinsent (retired 20 September 2022) Dr A Porter Lord Ribeiro, kt, CBE, FRCS, FRCSEd Mrs K Riding, LLB D Ritchie BA (appointed 5 October 2022) Dr C Roberts, BA, BM BCh, FRCA F J Shaw, MA, MSc, CEng, CSci P Silvester, ACIB, BA M Smith MA, MBA, ACIB (appointed 23 June 2023) M P Smith, MA T Spencer Mrs C Stallard, BA (appointed 5 October 2022) Mrs B Sullivan (appointed 5 October 2022) Lt. Col E T Taylor, BA, RA S Thomas, BA, LLM S Thomas, BA, LLB A J Thompson (appointed 21 December 2022) J Townsend, MA T Widdowson (appointed 21 December 2022) The Rev'd Canon Dr P R Williams, CStJ, DL Rt Rev'd Paul Williams Board of Trustees The Rev'd M Allen, BA (appointed 21 January 2023) S Bullingham, MSc, BSc Mrs K A Carden, BA., MPhil., (Chairman) The Rev'd R M Coombs, BSc, MA Mrs H S L Daltry, BA CSS Drew, MA L Glaser (appointed 23 June 2023) Mrs S L Hirst, BEd (retired 30 June 2023) S W Holliday, MA M A Hughes (appointed 21 January 2023) Mrs F Knight BA (appointed 21 January 2023) AVM (Ret’d) R Lock, CBE, BSc (appointed 5 October 2022) G McDonald, B.Comm B. Acc M Smith (appointed 23 June 2023) MP Smith, MA Lt. Col E T Taylor, BA, RA Finance & General Purposes Committee S Bullingham, MSc, BSc Mrs K A Carden, MPhil, BA Mrs H S L Daltry, BA *M A Hughes (appointed 21 January 2023) G McDonald, B.Comm B. Acc MP Smith, MA M Smith (appointed 23 June 2023)

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THE DEAN CLOSE FOUNDATION

TRUSTEES, OFFICERS AND ADVISERS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2023

Status and Administration

The Dean Close Foundation (referred to as the Charity or the Foundation throughout these financial statements) is a registered charitable company that incorporates the charitable institution originally founded in 1886. Its charity number is 1086829, its company number is 04193948, and its Articles of Association were adopted on 4" April 2001 and most recently amended on 28 May 2021. The liability of the Members is limited by guarantee.

Clerk to the Trustees AP
Bowcher MBA, FCIB, DipFS
Treasurer MP Smith, MA
Company Secretary MA Madeley
Registered Office and Shelburne Road
Principal Address Cheltenham
Gloucestershire, GL51 6HE
Banker HSBC Bank plc
2 The Promenade
Cheltenham
Gloucestershire, GL50 1LR
Solicitors Veale Wasbrough Vizards LLP
Narrow Quay House
Narrow Quay
Bristol, BS1 4QA
Harrison Clark Rickerbys Limited
Ellenborough House
Wellington Street
Cheltenham
Gloucestershire, GL50 1YD
independent Auditor Crowe U.K. LLP
4 Floor
St James House
St James Square
Cheltenham
Gloucestershire, GL50 3PR
Insurer Zurich Insurance plc
The Zurich Centre
3000 Parkway
Whiteley
Fareham
Hampshire, PO15 7JZ
Policy No.
KSC-252038-7703
(includes Employers’ Liability and
Public Liability)
Investment Manager Rathbone Investment Management
1 Curzon Street
London,W1J5FB

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THE DEAN CLOSE FOUNDATION ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023

The Trustees of The Dean Close Foundation present their Annual Report for the year ended 31%! August 20223 under the Charities Act 2011 and the Companies Act 2006, thus including the Directors’ Report and Strategic Report under the 2006 Act, together with the audited financial statements for the year.

DIRECTORS’ REPORT

COUNCIL AND CHARITY TRUSTEES

Organisation

The Members of the Company, known as the Council, (details as disclosed on pages 1 and 2) are responsible for the election of the Directors, who are referred to throughout this report as the Trustees. The Members also receive the Annual Report and Accounts at the AGM each year. The Foundation’s constitution provides for up to fifteen Trustees, drawn from the Council, who retire by rotation after four years and are eligible to serve up to a maximum of three terms of four years.

The Trustees determine the Charity’s strategic direction and monitor its operational performance closely, providing the Warden, Chief Finance and Operations Officer, Heads and Senior Leadership Teams with direction, leadership and support as appropriate. The Board meets four times each year. The work of overseeing the implementation of Board policies and decisions is carried out in large part by the Finance and General Purposes Committee (F&GPC) which meets at least six times per year. Specifically, the F&GPC scrutinises all budgets, management and statutory accounts, business plans and major capital proposals, before these are submitted to the Board for approval.

Following the annual review of Governance, it was agreed to retain the existing committee structure.

The F&GPC as detailed above with the other principal Board committees are:

The day-to-day leadership and management of the Foundation is delegated to the following:

Warden/CEO Mrs EL C Taylor Head, Dean Close School Mr B Salisbury Head, Dean Close Preparatory School Mr P Moss Head, Dean Close Pre-Preparatory School Dr C A Shelley (retired 31 August 2023) Mr J Cowling (appointed 1 September 2023) Head, Dean Close St John’s School Mr N Thrower Head, Dean Close Airthrie School Mr J Dobbie Chief Finance and Operations Officer Mr A P Bowcher

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Charity Governance Code

The Trustees have taken note of the seven principles set out within the Code and recommended practice. Whilst the Charity has not as yet formally adopted the Code, Trustees apply the Code’s recommended practices and more detailed information as to how this has been done is included within this Annual Report.

Stakeholder Engagement and Section 172 (1) Statement

The Trustees, as Directors, must act in accordance with a set of general duties. These duties are detailed in section 172 (1) of the Companies Act 2006 which is summarised as follows:

‘A Director of a Company must act in the way he/she considers, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:

The Trustees consider that they have fulfilled their duties in accordance with section 172(1) of the Companies Act 2006 and have acted in a way in which is most likely to promote the success of the Foundation for the benefit of its stakeholders as a whole in the following ways:

Pupils

All pupils benefit from the Foundation schools’ focus on individual development and on the aim of nurturing each child’s strengths and talents within a caring and secure family environment. Pupils are actively encouraged to offer comments and suggestions on the operation of the Foundation through School Councils and a range of other consultative opportunities, and these are considered in decisions made by the Senior Leadership Teams.

Pastoral care is considered particularly important across the Dean Close schools, and additional investment in health care, including mental health care, and in matron support in the boarding houses has added to the range of adults to whom pupils can go for support. In keeping with Dean Close’s Christian foundation, investment has also taken place in the chaplaincy team, to support the spiritual and character development of pupils.

Employees

The Foundation recognises that the qualities and skills of its employees and the commitment of its staff play a major role in its success. Weekly briefings keep staff informed of school wide matters of interest and there are many opportunities for staff training and development. In addition, termly Inset offers opportunities for staff to engage with the wider Foundation strategy and direction and to receive updates from the Warden, Chief Finance and Operations Officer, and Trustees. This year saw the launch of a new intranet system for internal communications, and the introduction of Paycare, a cash health plan for all staff. Staff have many opportunities to offer ideas, raise concerns and comment on the activity of the Foundation through surveys, cluster groups and Common Room representatives. Emphasis this year has been placed on helping to restore staff wellbeing and resilience post-pandemic, and two new training programmes have been introduced, the ‘Healthy Workplace’ training plan for all staff, and the ‘Healthy Leadership’ training plan for middle and senior leaders, both designed to enhance the skills of staff and to support healthy and sustainable working practices.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Stakeholder Engagement and Section 172 (1) Statement (continued)

Parents

The Foundation continues to ensure that it is in regular communication and engages with its parent body, and a weekly summary of news and events is emailed to them from each school. Opportunities for parents to attend fixtures, concerts, drama productions and chapel events continued during this year, and the full range of Speech Day and prize-giving events took place in the Trinity Term 2023. The Foundation also carried out several parental surveys to measure parental satisfaction and to identify areas for celebration and for improvement in the schools’ provision. These plans were communicated back to parents by the Heads.

Community

The Foundation is proud of its place within the local and wider community and endeavours to offer support and collaboration where possible by making available many of its facilities at below commercial rates. It also invites local schools to participate in specific sports and other events and to share various facilities. Dean Close School is a founding member of the Cheltenham Education Partnership, which includes 11 secondary schools in Cheltenham, with the aim of improving outcomes for all young people of secondary age in the area. The School is also a founding member of the Independent Schools’ Christian Alliance, working with other schools across the country who share a similar ethos, and has partnerships with schools in Uganda and Chengdu, China, with the aim of improving pupil outcomes both for Dean Close pupils and those of the partner schools.

Recruitment and Remuneration of Senior Management

Remuneration of senior employees is set by the Remuneration Committee, with the policy objective of providing appropriate incentives to encourage enhanced performance and of rewarding fairly and responsibly individual contributions to the Foundation’s success. The appropriateness and relevance of the remuneration policy is reviewed annually, including reference to comparisons with other independent schools to ensure that the Foundation remains sensitive to the broader issues of pay and employment conditions elsewhere. The Foundation aims to recruit, subject to experience, at the lower to medium point within a band, providing scope for rewarding excellence. Delivery of the Foundation’s charitable vision and purpose is primarily dependent on its key management personnel and staff costs are the largest element of expenditure.

Recruitment and Training of Trustees

The Nominations Committee makes recommendations for the appointment of Members and Trustees. Candidates are selected with regard to their availability, eligibility, commitment, specialist skills and Christian standing, and are appointed at a General Meeting of the Members. All new Members receive an induction pack of relevant documents outlining their responsibilities and attend an induction workshop conducted by the Chairman, Warden and Chief Finance and Operations Officer, at which the Foundation’s organisation and policy are discussed and the responsibilities and duties of Members and Trustees are fully explained. New Trustees also receive induction training provided by either the Foundation’s solicitors or an independent external body. Following a rigorous review as specified in the Charity Governance Code, the Board of Trustees have agreed by Special Resolution to extend the term of the current Chairman beyond 9 years to 2026. Trustees attend a range of external training days on a schedule kept by the Chief Finance and Operations Officer. Additionally, Trustees receive briefings from the Chief Finance and Operations Officer and one Board meeting per year is primarily devoted to training on governance issues and matters of current concern. Increasingly online training is undertaken.

Legal Structure of the Foundation and Definition

The Charity has two wholly-owned non-charitable subsidiaries, Dean Close Services Limited (DCSL) and Dean Close Nurseries Limited (DCNL). The results of the subsidiaries are included in Note 3 of the Financial Statements. The annual profits of both subsidiaries are donated to the Foundation under the Gift Aid Scheme. The trading activities of the subsidiaries comprise letting of the Foundation facilities when not in use by the Foundation, the provision of courses, revenue from the Foundation shops and the operation of day nurseries. The subsidiaries’ aims, objectives and achievements are covered in the relevant sections of this report. When this report refers to ‘Group’, it means the combined finances of the Charity (The Dean Close Foundation) and its two subsidiaries, DCSL and DCNL.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

OBJECTS, AIMS AND OBJECTIVES

When reviewing the aims and objectives of the Foundation and in planning its future activities the Trustees consider its charitable objectives and Strategic Plan.

Charitable Objects

The Charity’s Objects, as set out in its Articles, are the advancement of education, including the provision of schooling for children based firmly upon Christian evangelical principles and the provision of assistance with the resources available to the Foundation for the education of children with parents of limited resources. The Charity also has various restricted reserves enabling it to award modest scholarships, bursaries and prizes, as well as a few un-endowed trust funds held for special purposes in connection with the development of the Foundation’s facilities.

Mission statement

The Charity’s mission is to provide the necessary education and appropriate training to enable children and young people to flourish and to achieve their potential as individuals, and thereby to ensure that as adults they will be confident and successful members of society and effective contributors to it.

Intended impact

Within its charitable objects, the Charity’s intention is to provide first class childcare in its nurseries and a firstclass education through strong academic tuition and by developing broader skills that enable every pupil to realise his or her potential to the full. This involves emphasis on co-curricular activities through academic, sporting, artistic, team building and social skills, as well as encouraging spiritual awareness and self-reflection. This approach builds self-confidence and life skills in the Foundation’s pupils and inculcates a desire to learn and a willingness to contribute to the wider community whilst at schoo! and in later life. The Charity believes that the true impact of education can only be measured over the long term in the contribution alumni make to their communities. It endeavours to measure this impact by staying in close contact with alumni, conducting regular surveys of their activities and contributions to society.

Aims

The aim of the Charity is to provide high-quality education and care for day and boarding pupils from Nursery (age approximately 6 months) to Upper Sixth level (18/19 years). During the year under review, this was carried out by 6 nurseries and 5 schools operating in Cheltenham, Gloucester, Chepstow and Newport. The nurseries and schools are overseen jointly by the Trustees, through the Warden and Chief Finance and Operations Officer.

Most of the children from Dean Close Preparatory School enter the Senior School and the vast majority of those leaving the School after A Levels have historically sought entry to universities and other higher education establishments. Pupils from Dean Close St John’s School (at 13) and Dean Close Airthrie School (at 11) enter a variety of different senior schools, including Dean Close School. In addition to the academic life of the Schools, pupils’ co-curricular activities include an extensive range of musical, dramatic and artistic activities as well as sports training, with many teams achieving success at county and national level. The needs of the wider community are addressed through an imaginative and wide-ranging Community Action and Partnerships programme and the Foundation makes many of its facilities available to the community and to local charities at reduced rates.

Christianity is at the heart of the Charity both in its aim and values and in practice, in regular formal services and voluntary Christian Union groups, bible study classes and an active Chaplaincy. The Foundation’s educational policy is built upon its Christian principles and Trustees aim to ensure that pupils of all faiths and none are encouraged to consider their own response to questions of faith based upon a clear understanding of the Christian message. The Charity has defined its aim and values, based on the principles of biblical Christianity, and these are embedded in every aspect of its activities. The overarching aim is Flourishing, and the three key values are Courage, Love and Contribution.

The Charity aims to maintain a warm family atmosphere and a very high standard of pastoral care for all members of its community.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Objectives

Strategies to achieve the Objectives

The aims and objectives set for the Charity’s subsidiaries are to donate profits to facilitate the achievement of the Charity’s aims and objectives as above.

EMPLOYEE INFORMATION

Online resources via a policy portal are in place for members of the teaching and support staff; a number of important measures, including the development of a universal appraisal system, have been introduced for members of the Charity’s support staff. Considerable time and effort is expended in ensuring that all members of staff are kept fully informed about new developments and in addressing questions and any concerns.

A significant amount of staff time is devoted to ensuring that the Charity’s policies are fully compliant with current legislation and best practice. The Charity seeks to work with all employees, taking into account their personal circumstances, to ensure that appropriate training, development and advancement opportunities are available to enable them to reach their full potential. The Charity is committed to a policy of equal opportunity in employment. The aim of the policy is to ensure that:

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

DISABLED PERSONS

The Charity will employ disabled persons when they are suitable for a particular vacancy and every effort is made to ensure that they are given full and fair consideration when such vacancies arise.

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

The Trustees (who are the Directors of The Dean Close Foundation for the purposes of company law) are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

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

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions, 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 and the provisions of the Charity’s constitution. They are also responsible for safeguarding the assets of the charitable company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the Trustees are aware:

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

STRATEGIC REPORT

Principal risks and other matters of strategic importance

The Board of Trustees is responsible for the management of the strategic risks faced by the Charity. Detailed consideration of risks is delegated to the Finance and General Purposes Committee, assisted by the Warden and Chief Finance and Operations Officer. Risks are identified and assessed and controls are implemented and monitored regularly. The Charity’s Risk Model is reviewed and updated on a termly basis by the Warden and Chief Finance and Operations Officer with Trustee input and overview and then presented to the Finance and Generali Purposes Committee for approval.

The key risk controls used by the Charity include:

Through its risk management processes, the Board has concluded that the major risks currently confronting the Charity are:

The Board is satisfied that all major risks identified have been adequately mitigated where necessary and possible. It is recognised that such systems can only provide reasonable, but not absolute, assurance that major risks have been adequately managed. The diversification of income streams that Dean Close Nurseries Limited and Dean Close Services Limited bring to the Group will continue to reduce risk in the longer term.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Results for the year

Total full-time equivalent pupil numbers across all Dean Close schools for the year were 1,131 and on a likefor-like basis were very similar to those of the previous year.

The consolidated surplus for the year before financing costs, investment losses, depreciation and amortisation of goodwill was £1.88m (2022 £1.76m). This was ahead of budget and included a positive variance in net fee income and overall savings against the total expenditure budget. Total incoming resources increased by £2.2m (8%) with all main sources of income higher than the previous year. The increase was mainly derived from an increase in net fee income from the schools together with an increase in income from the trading subsidiaries, particularly Dean Close Nurseries Limited which performed exceptionally well. With the additional benefit of an increase in donations alongside the core charitable and trading activities, the diversity of the Foundation’s income stream is one of the key elements to reducing risk within the business model.

Total expenditure increased by £1.9m (6.7%) and was below budget. The careful control and monitoring of the cost base enabled the cost of the spike in energy prices to be absorbed within the overall expenditure budget and also helped to preserve an element of the contingency budget. Energy costs are now managed and partly hedged with futures contracts which will result in savings compared with energy costs this financial year.

Capital investment during the year totalled £2m. This included completion works for the refurbishment of the swimming pool on the Cheltenham site, upgrade and refurbishment works to two boarding houses, investment in plant and equipment across all sites and investment in the ICT network including a Core Switch upgrade.

There has been little movement within the Balance Sheet compared to the previous year. Rigorous debt management together with the monitoring and control of cash flow remain key areas of focus. Debtor and bad debt ratios have improved each of the last 5 years.

The Trustees are satisfied with the overall financial position.

Review of achievement and performance for the year

The schools within the charity achieved strong pupil numbers, including increasing numbers of international pupils, as confidence returned to these markets after Covid.

The Foundation continued to invest in IT infrastructure to make further progress on the business and educational innovation resulting from the pandemic. A great deal of IT infrastructure was replaced and enhanced. Cyber security and safety of Personal Data being a particular area of attention and investment currently.

Infrastructure and facilities improvements continued, including investment in the boarding houses at Dean Close Preparatory School and significant improvements to the school swimming pool. The Art Department at DCS was equipped with a suite of high-spec computers to support the A level Photography and Art courses.

At Dean Close School, those taking public examinations performed well, achieving 63% A*-B grades at A level and 54% 9-7 at GCSE. 90% of the leavers were accepted at either their first or second choice university. Dean Close sports teams performed well across the year, with the Girls U16 hockey team becoming National Indoor Champions and the U18 netball team having an undefeated season. The tennis team reached the LTA semi-finals.

A variety of drama productions took place during the year, including senior productions of ‘Our Country’s Good’ and ‘Lord of the Flies’. At DCPS the Junior Forms production of ‘Wind in the Willows’ featured every pupil in Years 3-5. The annual ‘Three Schools Dance Show’ at the Bacon Theatre was a great success.

Senior pupils took part in the first Music tour for several years, with 36 pupils travelling to Italy to perform a series of choral and instrumental concerts. Memorable concerts included a performance of Mozart's Mass in C at the Pittville Pump Rooms.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Review of achievement and performance for the year (continued)

A group of pupils travelled to Nyaktukura Memorial Secondary School in Ibanda, having raised funds to support the school, with which Dean Close has had a 20-year partnership.

The ‘Foundation Stones’ values continued to be embedded across ail the Schools and nurseries during the year, with reward systems to promote the Aim and Values of Flourishing, Courage, Love and Contribution, as well as assemblies, PSHCE lessons and tutorials focusing on their development.

Dean Close won national recognition for the experience offered to international pupils, and introduced a new offering for those unable to travel home for Exeats, with cultural/outdoor education trips to Bath, Stratford and the Forest of Dean. International week provided a focus on celebrating the variety of languages, cultures and perspectives across the school’s pupil body.

The Charity’s partnership work continued and was strengthened during the year, particularly in the Cheltenham Education Partnership work with other secondary schools in Cheltenham. Staff and pupils took part in a number of collaborative activities throughout the year.

In June 2023 Dean Close Airthrie School was inspected by the Independent Schools Inspectorate. The school was judged to be compliant against the Independent Schools Standards. The quality of pupils’ academic and other achievements was judged to be Good, and their personal development was judged to be Excellent. It was particularly pleasing to have recognition of the pupils’ maturity and their social skills: ‘Pupils are highly socially aware, adept at collaboration and are confident to share ideas’. Also in June 2023, ISI inspectors visited Dean Close St John’s for a Compliance Inspection, and found the school satisfied all the Independent Schools Standards and the National Minimum Standards for Boarding.

Energy and emissions report

With a new Estate Compliance Strategy in place, the Foundation is working on ways to reduce emission and waste across all of the estate.

During

the year the Foundation took the following energy efficiency actions:

The Foundation has also appointed an energy reduction company who have recently completed an ESOS survey. The results and recommendations are being scrutinised to ascertain where the Foundation can reduce its footprint as quickly as possible.

A summary of key data is as follows:

----- Start of picture text -----
||||||| |---|---|---|---|---|---| |UK|energy|use|(kWh)|9,306,088|8,473,380| |Associated|Greenhouse|gas|emissions|1,703|1,576| |Tonnes|CO2|equivalent| |Intensity|ratio (Emissions|per FTE)|a|aa|

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

UK energy use covers the use of natural gas for heating and cooking and electricity for heating and lighting across all entities of the Dean Close Foundation. Associated greenhouse gases have been calculated using the Gov.uk 2023 conversion tables using 0.18256 per kWh for natural gas and 0.207074 per kWh of electricity in each reporting year.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Grant-making policy

Trustees are committed to broadening access to Dean Close schools by offering means-tested bursaries based on an assessment of financial need to pupils whose parents/guardians are unable to pay the full fees.

This year, the value of means-tested bursaries, clergy and Armed Services awards and other concessionary fees was £3.2m (2022: £3.1m), with a further £1.2m (2022: £1.3m) awarded in the form of scholarships and exhibitions. The Foundation’s policy is to widen access to Dean Close to all sectors of the community by providing means-tested assistance with up to 100% of school fees for deserving children and to relieve hardship where an existing pupil’s education and future prospects may otherwise be at risk. Fundraising continues to provide major awards, known as Foundation Awards and the school is extremely grateful to and thanks donors for their support.

Scholarships were made available to entrants aged 11, 13 and 16 for outstanding ability in academic work, music, art, sport and drama. Such awards are limited to a maximum of 20% of the school fees for any individual. Minor awards were also extended to a small number of children entering the Preparatory School at age 7.

Fundraising performance

Donations, gifts and legacies totalled £274,208 in the year (2022: £198,434) and these were almost exclusively credited to restricted funds. Further details concerning restricted donations are included in Note 18b to the Financial Statements. The majority of the donations have been for Foundation Awards (transformational bursaries). The Trustees wish to record their thanks for the many kind and generous donations received throughout the year, without which this and other initiatives would have either been delayed or not been possible.

Fundraising is overseen by the Development Committee which is chaired by a Trustee and includes other Trustees. The Development department carries out day to day fundraising tasks assisted by an external Consultant. Particular attention continues to be given to the management of data and the protection of vulnerable people. The Foundation has had no complaints about its fundraising activities this year.

Investment powers, policy and performance

The Trustees’ powers for the investment of its corporate funds are set out in the Articles of Association and are, subject to statutory requirements, broadly equivalent to those of an individual beneficial owner. For the investment of the trust funds that it administers, the Foundation is subject to the Trustee Act 2000.

The Trustees’ policy is to obtain a return of capital gain and reinvested dividends on the invested funds at a suitable benchmark, thereby enhancing the Foundation’s ability to provide scholarships, bursaries and prizes in future years and preserving the capital value of the underlying investments.

The Charity’s investment portfolios are managed on a discretionary basis under an agreed set of investment parameters that are stated in the Foundation’s Investment Policy. Portfolio performance is reported termly against an agreed benchmark and the Foundation’s Investment Manager provides six-monthly briefings to the Finance and General Purpose Committee which include detailed analysis of the portfolio’s performance, overviews of market conditions and his strategic approach to obtaining an optimal return on the Charity’s investments.

At the year end the Group’s long term investments totalled £3.3m (2022: £3.1m). The increase in value includes incoming donations of £0.25m which were invested during the year. Investment losses during the year represented 3% of the portfolio value which reflected another difficult and challenging year for world stock markets.

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THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

Reserves level and policy

The Charity’s policy is to invest in premises and equipment to support the business and education requirements of the Charity, while ensuring adequate financing of day-to-day operational needs and the maintenance of adequate reserves to meet any contingencies as they arise. Therefore, retained surpluses are not held as free reserves, but are normally utilised for improvements to the Charity’s facilities. This policy is supported by external financing as and when necessary which is allocated to specific capital projects. The Group’s total reserves of £17.63m (2022: £17.56m) at the year end included £0.49m (2022: £0.51m) endowment capital, £0.53m (2022: £0.38m) unspent restricted funds and £16.6m (2022: £16.67m) unrestricted funds. £24.8m (2022: £24.59m) of this represented the net book value of fixed assets less associated long term funding arrangements, leaving negative free reserves of £8.2m (2022: negative £7.9m) at the year end.

Resources

The Charity has at its disposal restricted and unrestricted funds which are invested by Rathbone Investment Management in a broad portfolio of bonds, equities and cash, as disclosed in note 11.

The Charity has a main bank overdraft facility of £3m to service working capital requirements. The bank loan facility has been utilised as planned to provide funding to deliver ongoing capital developments which form part of the overall Strategic Plan. The Charity’s corporate and trust funds all have sufficient realisable assets appropriate to meet their respective obligations.

14

THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

FUTURE PLANS OF THE DEAN CLOSE FOUNDATION

The Charity’s Strategic Plan sets out the Dean Close values, vision and ethos. The focus of The Plan is sustainability: financial, educational and environmental. The Plan is built around four pillars:

Around these pillars, the plan establishes medium to long-term aims, which are:

The Development Board oversees fundraising activity towards our three major campaign objectives; campus, community and curriculum:

FINANCIAL STATEMENTS

The financial statements on pages 22 to 50 have been prepared in accordance with the Charities Statement of Recommended Practice FRS 102.

15

THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

KEY ITEMS IN THE STATEMENT OF FINANCIAL ACTIVITIES

Restricted income comprises dividend income from investments, rental income and donations. The endowed reserve contains the unamortised portion of the Arts Council Grant made for the construction of the Music School in 1997. The Foundation’s non-charitable trading includes the following activities of Dean Close Services Limited: the operation of the Bacon Theatre, lettings of certain parts of the Charity’s property to provide access for external groups to sporting, music, drama and other facilities, together with income from the School Shops. The Foundation has continued to develop a range of owned and managed sports and educational offerings including an Easter Revision course and various Dean Close branded sports camps, which are operated through Dean Close Services Limited. The management of the children’s day nurseries is undertaken through Dean Close Nurseries Limited. All surplus income of the trading subsidiaries is used for the purposes of the Charity.

PUBLIC BENEFIT

Direct Public Benefit includes means tested bursaries and grants made to existing and new families. Trustees are committed to broadening access to Dean Close by offering means-tested bursaries to pupils whose parents / guardians are unable to pay the full fees. All bursaries are means-tested annually and have a value of up to 100% of the fees. The Foundation also has a scheme that helps military families with their fees.

Bursaries can range from 5% to 100% of the school fee. On occasions where certain students are selected for particular extracurricular Arts/Drama/Sport trips but where the cost alone precludes their participation we can relieve that financial burden in certain circumstances. The Charity does not have a large endowment and therefore the Trustees are mindful, when bursaries are provided, that there remains a fair balance overall between those benefitting from bursaries and full fee-paying parents, many of whom make significant personal sacrifices to fund their children’s education. Fundraising continues to provide an endowment to support Foundation Awards and life-changing bursaries for pupils from families of modest means. Foundationers, supported by donors from the Old Decanian community, former parents and other individuals, continue their education at the senior school and these talented and deserving individuals would never have been able to consider independent schooling without these transformational awards. The Foundation aims to increase the number of Foundationers to 20 over the coming 10 years.

Indirect Public Benefit includes the use of facilities such as the Bacon Theatre and sports facilities which, from time to time, are let on a reduced cost to local groups or groups where their educational or artistic value is highly regarded in educational terms. The Foundation also invites local preparatory schools, junior schools and nurseries to benefit from Forest School, and from events such as sports skills days, choral and orchestral days, and science days. Local children also have the opportunity to attend theatre workshops and plays. Facilities are also made available to educational groups, and have, for example, hosted at no charge Gloucestershire Early Years meetings in the Pre-Prep hall with teachers from schools across Cheltenham.

The Trustees confirm that they have complied with their duty in Section 4 of the Charities Act 2011 to have due regard to the public benefit guidance published by the Charity Commission for England and Wales.

PARTNERSHIPS

Partnership activity in the Dean Close Foundation operates on four levels: locally, regionally, nationally and internationally. Locally, it has many partnerships with primary schools and their pupils attended concerts, plays, Sports Skills and Community Action days, and Forest School at DCSJS, DCPS and DCS or hosted assemblies led by DCS pupils. The Cheltenham Education Partnership (CEP), of which Dean Close is a Founder Member, has continued to gain momentum and provide benefits for pupils in all Cheltenham’s secondary schools. There are many regional partnership links in Gloucestershire and the South West for sport, business, chaplaincy and music. National links are with academic organisations, the Choir Schools’ Association, and TISCA. Finally, international partnerships have been disrupted but the Foundation remains committed to schools in Uganda and China. Fundraising to support Nyakatukura Memorial Secondary School in Uganda continued during the year, and pupils from the School visited Uganda in the summer of 2023.

16

THE DEAN CLOSE FOUNDATION

ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

AUDITOR

The auditor, Crowe U.K. LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

The Annual Report of the Trustees and incorporated Strategic Report were approved by the Board on 2 December 2023 and signed on its behalf by

Kay satan dts Chairman of Trustees

17

THE DEAN CLOSE FOUNDATION

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE DEAN CLOSE FOUNDATION

Opinion

We have audited the financial statements of The Dean Close Foundation for the year ended 31 August 2024 which comprise the consolidated statement of financial activities, the consolidated and charity balance sheets, the consolidated cash flow statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustee's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The trustees are responsible for the other information contained within the annual report. 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.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

18

THE DEAN CLOSE FOUNDATION

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE DEAN CLOSE FOUNDATION (CONTINUED)

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and the charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report included within the trustees’ report.

In light of the knowledge and understanding of the charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report included within the trustees’ report.

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

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement on page 9, 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.

19

THE DEAN CLOSE FOUNDATION

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE DEAN CLOSE FOUNDATION (CONTINUED)

Extent to which the audit was considered capable of detecting irregularities, including fraud

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

We obtained an understanding of the legal and regulatory frameworks within which the charity and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Charities Act 2011, together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charity’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company and the group for fraud. The laws and regulations we considered in this context for the UK operations were The Education (Independent School Standards) Regulations 2014, General Data Protection Regulation (GDPR), Health and Safety legislation, and Employment legislation.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be with the completeness and accuracy of certain income streams which includes, nursery fees and bursaries, scholarships and allowances and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management, the bursar and the Finance & General Purpose Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, designing audit procedures over certain income streams listed above, reviewing regulatory correspondence with the Charity Commission, Independent Schools Inspectorate, Ofsted and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

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

20

THE DEAN CLOSE FOUNDATION

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE DEAN CLOSE FOUNDATION (CONTINUED)

Use of our report

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

Guy Biggin Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor 4[th] Floor, St James House St James Square Cheltenham Gloucestershire GL50 3PR

Date: 18 December 2023

21

THE DEAN CLOSE FOUNDATION

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2023 (Incorporating a consolidated Income and Expenditure account)

Unrestricted Restricted Endowed
funds funds funds Total Total
Notes 2023 2023 2023 2023 2022
£ £ £ £ £
Income from:
Charitable activities
School fees receivable 2 23,528,970 - - 23,528,970 22,532,816
Ancillary trading income 4 571,910 - - 571,910 289,940
Othertrading activities
Non-ancillary trading income 3 5,763,352 - - 5,763,352 4,946,671
Investments
Investment income 11(c) 81,623 43,997 - 125,620 104,529
Bank and other interest 34,446 - - 34,446 13,355
Voluntary sources
Grants and donations 37 274,171 - 274,208 198,434
Total incoming resources 29,980,338 318,168 - 30,298,506 28,085,745
Expenditure on:
Raising funds
Non-ancillary trading 3 4,634,733 - - 4,634,733 4,039,683
Financing costs 614,385 - - 614,385 356,330
Investment management 19,949 2,644 - 22,593 23,413
Fundraising and development 112,051 - - 112,051 117,952
Total deductible costs 7 5,381,118 2,644 - 5,383,762 4,537,378
Charitable activities
Education and grant making 24,588,237 147,153 - 24,735,390 23,690,508
Total expenditure 7 29,969,355 149,797 - 30,119,152 28,227,886
Net incoming/(outgoing) funds from 10,983 168,371 - 179,354 (142,141)
operations before transfers and
investment gains
Losses on investments (97,368) (14,872) - (112,240) (340,985)
Transfers between funds 19,651 - (19,651) - -
Net movement in funds (66,734) 153,499 (19,651) 67,114 (483,126)
Fund balances at
1 September2022		 16,672,133 377,118 510,936 17,560,187 18,043,313
Fund balances at 31 August
2023 18 16,605,399 530,617 491,285 17,627,301 17,560,187

The notes on pages 25 to 50 form part of these financial statements.

22

THE DEAN CLOSE FOUNDATION

FOUNDATION AND CONSOLIDATED BALANCE SHEETS AS AT 31 AUGUST 2023 REGISTERED NUMBER: 04193948

Group Group Foundation Foundation
Notes 2023 2022 2023 2022
£ £ £ £
Fixed assets
Intangible 8 443,553 554,441 - -
Negative goodwill
Tangible
Investments		 9
10
11		 (44,946)
32,868,882
3,296,063		 (60,809)
31,863,321
3,088,732		 (44,946)
32,536,452
4,815,564		 (60,809)
31,621,877
4,719,121
36,563,552 35,445,685 37,307,070 36,280,189
Current assets
Stocks 200,336 137,121 19,722 14,239
Debtors 12 1,792,026 1,657,162 1,662,755 1,486,017
Cash at bank and in hand 67,778 84,724 12,906 28,659
2,060,140 1,879,007 1,695,383 1,528,915
Current liabilities
Creditors payable within one year 13 (11,243.418) (9.493.118) (11,780,396) (10,046,065)
Net current liabilities (9,183,278) (7,614,111) (10,085,013) (8,517,150)
Total assets less current liabilities 27,380,274 27,831,574 27,222,057 27,763,039
Long term liabilities
Creditors payable afterone year 14 (9,752,973) (10,271,387) (9,710,519) (10,210,802)
Net assets 17,627,301 17,560,187 17,511,538 17,552,237
Financed by:
Endowed funds 18a 491,285 510,936 491,285 510,936
Restricted funds 18b 530,617 377,118 530,617 377,118
Unrestricted funds 18c 16,605,399 16,672,133 16,489,636 16,664,183
Totalfunds 18 17,627,301 17,560,187 17,511,538 17,552,237

The net result for the financial year dealt with in the financial statements of the parent charity was a deficit of £40,699 (2022: deficit £483,127). The financial statements were approved and authorised for issue by the Board of The Dean Close Foundation on 2 December 2023 and signed on its behalf by:

----- Start of picture text -----
Kal Ci \ -) Kathryn Carden
a Chairman
- Matthew Smith
Treasurer
----- End of picture text -----

The notes on pages 26 to 50 form part of these financial statements.

23

THE DEAN CLOSE FOUNDATION

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 AUGUST 2023

Group Group
Notes 2023 2022
£ £
Reconciliation of net incoming/(outgoing)/ resources
to netcash inflowfrom operating activities
Net incoming/(outgoing) funds from operations 179,354 (142,141)
Elimination of non-operating cashflows:
Investment income and bank interest received (160,066) (117,884)
Finance costs 614,385 356,330
Depreciation charge 10 990,738 1,455,378
Profiton disposal ofassets 5 (7,747) (81,867)
Amortisation ofgoodwill on acquisition 8 110,888 110,888
Amortisation ofnegative goodwill on acquisition 9 (15,863) (15,861)
Increase in stock (63,215) (17,090)
Increase in debtors (134,864) (50,477)
Decrease in creditors (excluding fees in advance and (352,749) (1,006,335)
deposits and composition fees)
Increase in fees in advance, deposits and composition fees 305,405 680,254
Net cash inflow from operations 1,466,266 1,171,195
Cash flows used in investing activities
Purchase oftangible fixed assets 10 (1,998,024) (1,485,195)
Proceeds from sale oftangible fixed assets 9,472 218,146
Additions to investment portfolio (319,571) (47,978)
Investment income and bank interest received 160,066 117,884
Net cash used in investing activities (2,148,057) (1,197,143)
Cash flows provided byfinancing activities — —
Finance costs paid (614,385) (356,330)
New bank loan 285,000 750,000
New finance lease and hire purchase contracts 153,312 248,561
Repayment ofsecured loans (424,347) (627,673)
Repayment ofother loan (71,376) (100,000)
Repayment offinance lease and hire purchase contracts (59,948) (78,640)
Netcash used byfinancing activities (731,744) (164,082)
Change in cash and cash equivalents in theyear (1,413,535) (190,030)
Cash and cash equivalents atthe beginning ofthe year (135,538) 54,492
Cash and cash equivalents atthe end ofthe year (1,549,073) (135,538)
Analysis ofcash and cash equivalents
Cash at bank 67,778 84,724
Bank overdrafts 13 (1,616,851) (220,262)
(1,549,073) (135,538)

24

THE DEAN CLOSE FOUNDATION NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 1 STATEMENT OF ACCOUNTING POLICIES

(a) Charity information

The Dean Close Foundation is a charitable company limited by guarantee incorporated in England (charity number 1086829 and company number 04193948) and is a Public Benefit Entity operating from its registered office Shelburne Road, Cheltenham, GL51 6HE.

(b) Basis of accounting

The financial statements have been prepared in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), The Companies Act 2006 and the Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) — (2"¢ edition effective 1 January 2019). The financial statements have been prepared on the historical cost basis of accounting, as modified by the revaluation of investments, and in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), the Companies Act 2006, the Charities SORP (FRS 102) and the accounting policies set out below.

The functional currency of the Foundation is considered to be GBP because that is the currency of the primary economic environment in which the Foundation operates.

The Charity has taken advantage of the exemption available to a qualifying entity in FRS 102 from the requirement to present a charity-only Cash Flow Statement within the consolidated financial statements.

No separate Statement of Financial Activities has been presented for the Foundation alone, as permitted by Section 408 of the Companies Act 2006. The net results of the parent Charity are disclosed on page 23.

Going Concern

As part of the Trustee’s responsibilities of the appropriateness of adopting the going concern basis in preparing the financial statements, a range of scenarios have been considered. The assumptions modelled are based on the current economic climate and the Headwinds. The most severe risk identified is a downturn in pupil numbers and the impact that this would have on the Foundation’s cash flow. In this event, the Trustees measured response would be to place a moratorium on all but essential capital expenditure, to make further cost savings where appropriate to do so and if necessary to liquidate investments held as detailed in note 11 in order to enable the Foundation to operate within its current or increased borrowing facilities. The Trustees are mindful of “The Headwinds”, the challenges that lie ahead. The possible imposition of VAT on school fees and various charitable reliefs being withdrawn by government. Much research is ongoing to develop strategies to mitigate such risk. The Foundation has four 3 year finance strategies covering new and additional income as well as ‘re-setting’ the cost base. The three-year strategies started on 1 September 2023 and include doubling the number of Nurseries, increasing the profitability of Dean Close Services Limited and establishing a new lower cost base across the Foundation. The Trustees believe that the Foundation is therefore in a strong position to combat such challenges.

On the basis ofthis review, these financial statements have been prepared on a Going Concern basis, which the Trustees consider to be appropriate based on the results for the year ending 31 August 2023 and cash flow projections prepared for the period 31 August 2024 and beyond. The cash flow projections indicate that the Group will be able to meet its liabilities as they fall due and will be able to operate within the facilities currently available. The Trustees consider that there are no material uncertainties over the Foundation’s financial viability.

25

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

Judgments in applying Accounting Policies and Key Sources of Estimation Uncertainty

Estimates and judgments 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.

The items in the financial statements where these estimates and judgments have been made include the following:

(i) Useful economic lives of tangible and intangible assets

The annual depreciation and amortisation charge for the tangible and intangible assets are sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. See notes 8, 9 and 10 for the carrying amount of the assets and notes 1(i), (j) and (k) for the useful lives for each class of assets.

(ii) Impairment of investments

When assessing impairment of the investments, management considers factors including the financial results, future outlook, net assets and market value of each investment. See note 11 for the net carrying amount of investments.

(iii)

Impairment of debtors

The group makes an estimate of the recoverable value of trade and fee debtors. When assessing impairment of trade and fee debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 12 for the net carrying amount of the debtors.

(c)

Basis of consolidation

The consolidated statement of financial activities and balance sheet include the financial statements of The Dean Close Foundation and its subsidiary Companies, Dean Close Services Limited, Dean Close Nurseries Limited and Dean Close General Charitable Trust and certain Scholarship Funds made up to 31 August 2023. Dean Close Services Limited manages and lets property on behalf of the Foundation and operates the School shops and the Bacon Theatre. Dean Close Nurseries Limited operated six children’s day nurseries during the year under review. All intra group sales and profits are eliminated fully on consolidation.

26

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

(d) Incoming resources

Fees and similar income

Fees receivable and charges for services and use of premises are accounted for in the period in which the service is provided. School fee income represents fees receivable, including additional charges, less concessions.

Amounts received under the School’s Advance Fee Scheme contracts for education not yet utilised to settle school fees are recorded as deferred income and allocated as current liabilities where the education will be provided with 12 months from the reporting date and as long-term liabilities where the education will be provided in subsequent years.

Non-charitable trading

Income from non-charitable trading represents the turnover from the trading activities of the subsidiary companies, Dean Close Services Limited and Dean Close Nurseries Limited and is recognised when the company has earnt entitlement to the revenues.

Investment Income

Dividend income is accounted for at the date on which the Charity has entitlement to the dividend. Interest on bank balances and fixed income securities are accounted for in the period in which interest is earned.

(e)

Government grants

Income from Government grants, whether “capital” grants or “revenue” grants, is recognised when the Group has entitlement to the funds, any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably.

Where entitlement occurs before income is received, the income is accrued. Where income is received in advance of the Group having entitlement to the funds, the income is deferred.

(f)

Donations

Donations are accounted for as and when entitlement arises, the amount can be reliably quantified and economic benefit to the Charity is considered probable. Donations receivable for the general purposes of the Charity are credited to “other unrestricted funds’, to distinguish them from direct Foundation income. Donations for purposes restricted by the wishes of the donor are taken to “restricted funds” where these wishes are legally binding on the Trustees. Donations required to be retained as capital in accordance with the donor’s wishes are accounted for as “endowments” — permanent or expendable according to the nature of the restriction. Gifts in kind are valued at estimated open market value at the date of gift, in the case of assets for retention or consumption, or of the value to the Foundation in the case of donated services or facilities.

27

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

g) Legacies

For residuary legacies, entitlement is taken as the earlier of the date on which either the charity is aware that probate has been granted, the estate has been finalised and notification has been made by the executor(s) to the charity that a distribution will be made, or when a distribution is received from the estate. Pecuniary legacies are recognised once probate has been granted and notification received and where they can be reliably measured. Receipt of a legacy, in whole or in part, is only considered probable and measurable when the amount can be measured reliably and there are no potential claims against the estate.

(h) Expenditure

Expenditure is accounted for on an accruals basis as soon as a liability is considered probable, discounted to present value for longer term liabilities. Overhead and other costs not directly attributable to particular functional activity categories are apportioned over the relevant categories on the basis of the Trustees’ best estimates of the amount attributable to that activity in the year, either by reference to staff time or space occupied, as appropriate. The irrecoverable element of VAT is included with the item of expense to which it relates.

Cost of generating funds includes all the financing costs of the entity in addition to the costs of the development office and trading expenditure of the subsidiary companies accounted for on an accruals basis.

Governance costs comprise the costs of running the Charity, including strategic planning for its future development, also internal and external audit, any legal advice for the Trustees, and all the costs of complying with constitutional and statutory requirements, such as the costs of Trustees meetings and of preparing statutory accounts and satisfying public accountability.

(i) Goodwill and amortisation

Goodwill is the difference between the amounts paid on the acquisition of a business and the fair value of the identifiable assets and liabilities.

Amortisation is provided on goodwill at rates calculated to write off the cost on a straight line basis over its expected useful life as follows:

Goodwill on acquisition of Nursery Childcare Services (UK) Limited 10% on cost

(j)

Negative goodwill

Negative goodwill is the difference between the fair value of the assets and liabilities acquired of a business and the amount paid on acquisition.

Negative goodwill is credited to incoming resources on a straight line basis over its expected useful life as follows:

Negative goodwill on Asset Purchase of Airthrie School LLP 20% on valuation

28

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

Tangible fixed assets are stated in the balance sheet at cost less depreciation. Items costing less than £5,000 are written off as an expense on acquisition.

Depreciation is calculated so that tangible fixed assets are written off over their currently estimated useful lives at annual rates, which are as follows: -

Freehold land Nil Freehold property 1% - 6.67% on cost Plant and equipment 2%/10%/20% on cost Theatre equipment 10% on cost Fixtures and fittings 10% - 20% on cost Motor vehicles 20% on cost School shop equipment 20% on cost Computer equipment 10% - 25% on cost

Assets under construction are not depreciated until they are brought into use.

Following a periodic review of fixed assets on 1 September 2022, the rate of depreciation on the majority of freehold property was reduced to 1% and in respect of upgrade work to boarding houses included within fixtures and fittings, was reduced to 10%. Depreciation on these assets has been recalculated for the year under review with reference to the number of remaining years since the date of acquisition.

())

Operating leases

Rentals under operating leases are charged to the Statement of Financial Activities on a straight line basis over the lease term.

(m) Stocks

Stocks are stated in the balance sheet at the lower of cost and net realisable value after making due allowances for obsolete and slow moving stock.

Short term debtors are measured at transaction price, less any impairment.

Cash is represented by cash in hand and deposits with financial institutions.

Short term creditors are measured at the transaction price.

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the Statement of Financial Activities on a reducing balance basis over the lease term.

29

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

(r) Taxation

The Dean Close Foundation is a registered charity and is not liable to Corporation Tax or Income Tax on all its income and gains properly applied for its charitable purposes. Dean Close Services Limited and Dean Close Nurseries Limited, trading subsidiaries of the Foundation, are liable to Corporation Tax.

(s) Pension costs

Teaching Staff

The scheme is a multi-employer pension scheme. It is not possible to identify the Charity’s share of the underlying assets and liabilities of the Teachers’ Pension Scheme on a consistent and reasonable basis and therefore, as required by FRS 102, the scheme is accounted for as if it were a defined contribution scheme. The Charity’s contributions, which are in accordance with the recommendations of the Government Actuary, are charged in the period in which the salaries to which they relate are payable.

The Charity also operates a defined contribution group personal pension plan with AVIVA. Employer's pension costs are charged in the period in which the salaries to which they relate are payable.

All pension costs are allocated to unrestricted funds, this being the fund from which wages and salaries are paid.

Non-Teaching Staff

The Charity operates a defined contribution group personal pension plan for its non-teaching staff with AVIVA (2022: three defined contribution group personal pension plans with Scottish Equitable, Standard Life and AVIVA). Employer's pension costs are charged in the period in which the salaries to which they relate are payable.

All pension costs are allocated to unrestricted funds, this being the fund from which wages and salaries are paid.

(t) Investments

Listed investments are valued at market value as at the balance sheet date. Unrealised gains and losses arising on the revaluation of investments are credited or charged to the Statement of Financial Activities and are allocated to the appropriate Fund according to the “ownership” of the underlying assets. investments in subsidiaries are valued at cost less provision for impairment.

(u) Composition fees

The Charity operates a composition fee scheme for parents. Income arising is treated as general income of the Foundation, out of which provision for future fee liabilities under the scheme is made.

(v) Recognition of liabilities

Liabilities are recognised when the Charity has an obligation to make payment to a third party.

(w) Redundancy

Redundancy and termination costs only occur where absolutely necessary and are accounted for on an accruals basis when the commitment to terminate a post on the grounds of redundancy has been made.

30

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

1 STATEMENT OF ACCOUNTING POLICIES (continued)

(x) Funds policy Unrestricted funds are funds that are available for use at the discretion of the Trustees in furtherance of the objects of the Charity. Designated funds are unrestricted funds which have been set aside by Trustees for specific purposes.

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

The Charity holds a grant under permanent endowment. Any income arising on the Permanent Endowment Fund is treated as restricted income of the Charity.

Expendable endowment funds represent the expendable endowment of the Charity. The funds are expendable at the discretion of the Trustees.

Basic financial instruments are initially recognised at transaction value and subsequently measured at amortised cost with the exception of investments which are held at fair value. Financial assets held at amortised cost comprise cash at bank and in hand, together with trade and other debtors. A specific provision is made for debts for which recoverability is in doubt. Cash at bank and in hand is defined as all cash held in instant access bank accounts and used as working capital. Financial liabilities held at amortised cost comprise all creditors except social security, other taxes and fees received in advance.

2 Charitable activities — fees receivable

2023 2022
£ £
Fees receivable comprise:
School fees 27,783,183 26,760,542
Allowances
Bursaries and concessionary fees (3,184,272) (3,059,556)
Scholarships and exhibition awards (1,176,533) (1,262,287)
23,422,378 22,438,699
Add back: Bursaries, scholarships and
awards paid for by restricted funds 106,592 94,117
23,528,970 22,532,816

Scholarships, bursaries and exhibition awards paid for out of Restricted funds were £106,592 (2022: £94,117).

31

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

3 Income from subsidiary’s trading activities

The following trading results for the subsidiary are incorporated in the Consolidated Statement of Financial Activities:

Financial Activities:
2023 2022
£ £
Turnover 945,686 773,826
Cost of sales (262,488) (216,383)
Gross profit 683,198 557,443
Administrative expenses (410,819) (349,965)
Governance costs (2,340) (2,000)
Interest payable (3,980) (4,646)
Operating profit
Donation made under gift aid tothe Foundation		 266,059
(158,245)		 200,832
(200,832)
Retained profit forthe financial year 107,814 -
Total assets 471,609 366,844
Total liabilities 235,846 238,895
Share capital 120,000 120,000
Profit and loss account 115,763 7,949
Shareholder’sfunds 235,763 127,949

The subsidiary donated taxable profits to the Charity of £266,059 (2022: £200,832) under the Gift Aid Scheme.

included in cost of sales and administration expenses are £439,418 (2022: £287,442) paid to The Dean Close Foundation. These transactions were eliminated on consolidation. At the year end, £67,878 was owed by The Dean Close Foundation (2022: £4,371).

32

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

3 Income from subsidiary’s trading activities (continued)

(b) The Charity owns the whole of the ordinary share capital of Dean Close Nurseries Limited (registered number 09635445, registered office Shelburne Road, Cheltenham, GL51 6HE), whose trading activities during the year under review include the provision of nursery care operating from six sites.

The following trading results for the subsidiary are included in the Consolidated Statement of Financial Activities:

Activities:
2023 2022
£ £
Turnover 4,817,666 4,172,845
Operating expenses (255,639) (207,465)
Gross profit 4,562,027 3,965,380
Administrative expenses (3,694,787) (3,255,224)
Governance costs (4,680) (4,000)
Operating profit 862,560 706,156
Donation made under gift aid to the Foundation (862,560) (706,156)
Retained profit for the financial year - -
Total assets 1,100,122 1,075,427
Total liabilities 144,173 119,478
Share capital 10,000 10,000
Profit and loss account 945,949 945,949
Shareholder’sfunds 955,949 955,949

The subsidiary donated £862,560 (2022: £706,156) taxable profits to the Charity under the Gift Aid Scheme.

Included in operating and administration expenses are £3,332,390 (2022: £2,740,643) paid to The Dean Close Foundation. These transactions were eliminated on consolidation. At the year end, £806,665 (2022: £846,365) was owed by The Dean Close Foundation.

33

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

4 Charitable activities - ancillary trading income

2023 2022
£ £
Registration fees 33,498 29,837
Holiday courses - 918
Pupils insurance discounts 1,709 1,051
Sundry receipts 139,332 136,743
School trips and activities 397,371 121,391
571,910 289,940

5 Net incoming/(outgoing) resources

This is stated after charging/(crediting):

Group Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Depreciation oftangible
fixed assets
- Owned 958,409 904,831 1,429,402 1,375,139
- Held under hire 32,329 20,783 25,976 14,429
purchase
Amortisation ofgoodwill 110,888 - 110,888 -
Amortisation of negative (15,863) (15,863) (15,861) (15,861)
goodwill
Auditor’s remuneration:
- Fees payable for the
audit ofthe financial 35,100 28,080 30,000 24,000
statements
-Tax and other advisory 2,140 - 2,500 -
services
Operating leases:
- Land and Property 433,593 433,593 406,949 406,949
Interest payable
- Under hire purchase 10,154 6,174 9,228 4,582
- Other 573,736 573,736 300,338 300,338
Profit on disposal of (7,747) (7,747) (81,867) (81,867)
tangiblefixedassets

34

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

6 Staff costs
2023 2022
£ £
Wages and salaries 16,039,900 14,602,985
Social security costs 1,374,083 1,279,938
Pension contributions - Teachers’ Pension Scheme 1,399,026 1,521,444
Pension contributions — other 286,861 180,194
Other costs including agency staff 144,830 299,496
Total direct costs ofemployment 19,244,700 17,884,057
2023 2022
£ £
Aggregate employee — benefits of key management personnel 1,003,172 956,693
The average number of staff during the yearwas:
2023 2022
Headcount Headcount
Teaching Staff 286 293
Nursery Staff 149 138
Administration support:
Welfare 101 88
Premises 33 29
Support 125 129
Administration ofcharity 1 1
695 678
The number ofhigher paid employees was:
2023 2022
No. No.
£60,001 - £70,000 14 7
£70,001 - £80,000 6 4
£80,001 - £90,000 1 1
£90,001 - £100,000 1 1
£100,001 - £110,000 1 1
£110,001 - £120,000 - 1
£120,001 - £130,000 1 -
£160,001 - £170,000 - 1
£170,001-£180000 1 -

In the year, contributions were made for 13 (2022:11) higher paid employees, to the Teachers’ Pension Scheme, a defined benefit scheme and contributions were made for 12 (2022: 5) higher paid employee to a defined contribution scheme.

The Trustees received ENil (2022: ENil) remuneration during the year.

During the year, there were redundancy or termination payments made which amounted to £19,215 (2022: £58,197). At the year end £4,612 was outstanding (2022: £23,502).

35

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

7 (a) Analysis of expenditure

Other Total Total
Staffcosts costs Depreciation 2023 2022
£ £ £ £ £
Costs ofgenerating funds
Trading costs 3,209,567 1,360,042 65,124 4,634,733 4,039,683
Financing costs - 614,385 - 614,385 356,330
Investment management
fees - 22,593 - 22,593 23,413
Development costs 86,779 25,272 - 112,051 117,952
Total costs of generating 3,296,346 2,022,292 65,124 5,383,762 4,537,378
funds
Charitable activities
Education andgrantmaking
Teaching
Welfare
Premises		 11,648,393
1,010,721
773,301		 1,212,821
1,998,346
2,164,393		 -
-
357,044		 12,861,214
3,009,067
3,294,738		 11,943,352
2,589,141
3,655,179
Support costs and
governance 2,515,939 2,379,269 568,570 5,463,778 5,408,719
Grants, awards and prizes - 106,593 - 106,593 94,117
Total charitable 15,948,354 7,861,422 925,614 24,735,390 23,690,508
expenditure
Totalexpended 19,244,700 9,883,714 990,738 30,119,152 28,227,886

7 (b) Governance included in support costs

2023 2022
£ £
Remuneration paid to auditor 35,100 30,000
Reimbursement of personal expenses to Trustees 3,926 3,967
Other governance costs 5,491 5,332
44,517 39,299

Of the Trustees 6 (2022: 6) receiveda total of £3,926 (2022: £3,967) in respect of repayment of travel and accommodation costs, reference books and attendance at training and conferences.

36

_

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

8 Intangible fixed assets — Group only

Total
Goodwill
£
Cost
At 1 September 2022 and 31 August 2023 1,108,881
Amortisation
At 1 September 2022 554,440
Charge for the year 110,888
At 31 August 2023 665,328
Net book value
At 31 August 2023 443,553
At31August2022 554,441

Goodwill arose from the acquisition of the shares in Nursery Childcare Services (UK) Limited on 1 September 2018, which held two profitable nurseries which were transferred to another group entity.

Goodwill is amortised over the Trustees’ estimate of its useful life of 10 years.

THE DEAN CLOSE FOUNDATION

sO

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED (CONTINUED)

31 AUGUST 2023

9 Negative goodwill — Group and Foundation

Total
Negative
Goodwill
£
Cost
At1September 2022 and 31 August2023 (79,313)
Amortisation
At 1 September 2022 18,504
Credit for the year
15,863
At 31 August 2023 34,367
Net book value
At 31 August 2023 (44,946)
At 31August2022 (60,809)

Negative goodwill arose from the Asset Purchase of Airthrie School LLP on 5 July 2021. These assets were included in the financial statements at fair value together with associated costs and are in respect of tangible fixed assets. The difference between the valuation and purchase price resulted in negative goodwill of £79,313. This sum is being credited back to incoming resources in the Statement of Financial Activities over a 5 year period ona straight line basis.

QR

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

10 Tangible fixed assets - Group

Freehold Assets Fixtures
land and under and Plant and
property construction fittings equipment Total
£ £ £ £ £
Cost
At
1 September 2022		 39,041,555 - 3,424,541 4,803,788 47,269,884
Additions
Disposals		 383,030
-		 69,445
-		 626,166
-		 919,383
(271,505)		 1,998,024
(271,505)
At 31 August2023 39,424,585 69,445 4,050,707 5,451,666 48,996,403
Depreciation
At
1 September2022		 10,364,057 - 2,206,386 2,836,120 15,406,563
Charge forthe year 357 ,044 - 286,149 347,545 990,738
Disposals - - - (269,780) (269,780)
At 31 August 2023 10,721,101 - 2,492,535 2,913,885 16,127,521
Net book value
At 31 August2023 28,703,484 69,445 1,558,172 2,537,781 32,868,882
At31August2022 28,677,498 - 1,218,155 1,967,668 31,863,321

The net book value of assets held under finance leases or hire purchase contracts included above within Plant and Equipment is £349,956 (2022: £228,973).

Tangible fixed assets — The Dean Close Foundation

Freehold Assets under Fixtures
land and
property		 construction
£		 and
fittings		 Plantand
equipment		 Total
£ £ £ £
Cost
At 1 September2022 39,041,555 - 3,130,404 4,574,054 46,746,013
Additions
Disposals		 383,030
-		 69,445
-		 534,624
-		 854,815
(271,505)		 1,841,914
(271,505)
At 31 August2023 39,424,585 69,445 3,665,028 5,157,364 48,316,422
Depreciation
At1September 2022 10,364,058 - 2,038,658 2,721,420 15,124,136
Charge forthe year 357,044 - 239,976 328,594 925,614
Disposals - - - (269,780) (269,780)
At 31 August 2023 10,721,102 - 2,278,634 2,780,234 15,779,970
Net book value
At 31 August 2023 28,703,483 69,445 1,386,394 2,377,130 32,536,452
At31August2022 28,677,497 - 1,091,746 1,852,634 31,621,877

The net book value of assets held under finance leases or hire purchase contracts included above within Plant and Equipment is £257,584 (2022: £125,054).

39

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED CONTINUED

31 AUGUST 2023

11(a) Investments

Investments
Group Group
2023 2022
£ £
At 1 September2022 3,088,732 3,381,739
Incoming funds 251,998 -
Realised losses (35,123) (44,409)
Unrealised losses (77,117) (296,576)
Management fees (22,593) (23,412)
Dividends reinvested 90,166 71,390
At31August2023 3,296,063 3,088,732

Details of the additions and disposals during the year are shown in the Cash Flow Statement.

These balances can be further analysed as follows:

Group Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
(a) Investment in subsidiaries - 1,519,501 - 1,630,389
(b) Other Investments 3,209,439 3,209,439 2,785,097 2,785,097
at market value:
(c) Investments held in cash 86,624 86,624 303,635 303,635
3,296,063 4,815,564 3,088,732 4,719,121

11(b) Investments — Group

Investments held on non-UK stock markets totalled £580,238 (2022: £615,144). Within the investment portfolio, the Charity holds 175,000 units of 0% Treasury T-Bills with a maturity date of 18 September 2023 and a market value of £174,573. There are no other specific investments which represent more than 5% of the overall investment portfolio (2022: none)

The market values of quoted investments held at 31 August 2023 are based upon stock market quoted prices at the year end date.

11(c) Investment income

Investment income
2023 2022
£ £
Dividendsfrom managed funds 86,842 70,385
Intereston government stocks 439 97
Interest on cash deposits 4,839 547
Renta! income on property 33,500 33,500
125,620 104,529

40

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 CONTINUED

12 Debtors

Debtors
Group __Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Fees and extras (less provision for
bad debts) 934,510 925,657 996,549 969,921
Other debtors 290,169 210,953 182,644 92,362
Prepayments and accrued income 567,347 526,145 477,969 423,734
1,792,026 1,662,755 1,657,162 1,486,017

Fees and extras are stated after impairment provisions totalling £401,244 (2022: £487,140).

13 Creditors: amounts falling due within one year

Group _—Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Bank loans (see note 14) 454,000 454,000 431,511 431,511
Other loan (see note 14) 125,000 125,000 71,376 71,376
Bank overdraft 1,616,851 1,616,851 220,262 220,262
Fees received in advance 3,924,028 3,924,028 3,042,358 3,042,358
Trade creditors 899,988 711,532 873,191 765,012
Amounts owed to subsidiaries - 874,543 - 850,736
Taxation and social security 963,840 963,840 1,321,800 1,321,800
Other creditors 229,518 204,173 291,500 259,450
Accruals and deferred income 741,516 635,882 701,120 560,808
Obligations under finance lease and 75,171 §7,041 37,933 20,685
hire purchase contracts (see note 16)
Deposits held 1,592,800 1,592,800 1,676,441 1,676,441
10,622,712 11,159,690 8,667,492 9,220,439
Composition fees (see note 15) 620,706 620,706 825,626 825,626
11,243,418 11,780,396 9,493,118 10,046,065

41

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

14 Creditors: amounts falling due after more than one year

Group Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Bank loans (see below) 7,228,780 7,228,780 7,390,616 7,390,616
Other loan (see below) 1,525,000 1,525,000 1,650,000 1,650,000
Obligations underfinance leaseand 188,114 145,660 131,988 71,403
hire purchase contracts (see note 16)
Composition fees (note 15) 811,079 811,079 4,098,783 1,098,783
9,752,973 9,710,519 10,271,387 10,210,802

The bank loans are repayable by instalments

The bank loans are repayable by instalments
2023 2022
£ £
Over 5 years 5,004,830 5,389,800
Within 2 to 5 years 1,301,753 1,569,305
Within 1 to 2 years 922,197 431,511
7,228,780 7,390,616
Within 1 year (see note 13) 454,000 431,511
7,682,780 7,822,127

On 18 June 2021, formal repayment terms were agreed relating to an existing bank loan of £7,699,800. The maximum facility limit was £7.7m which was repayable in 60 instalments of £128,333.34 payable on 31 January, 30 April and 30 September of each year. The interest rate on the loan was 1.98% above Bank of England Base Rate. The loan was secured on certain freehold properties. On 31 August 2023, this loan was reviewed and continues on the same repayment terms as the pre-existing loan for a period of 17 years 11 months. The interest rate on the loan is 1.98% above Bank of England Base Rate and is subject to review in August 2025.

On 7 September 2021, a loan of £750,000 was agreed to finance the purchase of a property. The loan is repayable over a 3 year term commencing on 27 October 2021 in 35 monthly instalments of £3,819.42 (capital and interest) with the remaining balance due no later than 27 September 2024. The interest rate on the loan is 1.97% over the Bank of England Base Rate. The loan is secured on certain freehold properties.

On 3 February 2023, a loan of £285,000 was agreed to finance the updating and replacement of the ICT network and wi-fi. The loan is repayable over a 5 year term commencing on 3 March 2023 in 60 monthly instalments of £5415.06 (capital and interest). The interest on the loan is 2.27% over the Bank of England Base Rate.

On 31 August 2023, a loan of £850,000 was agreed which was drawn down on 13 September 2023 to finance the purchase of a property. The loan is repayable in full by one instalment on 13 September 2024. The interest rate on the loan is 1.75% over the Bank of England Base Rate. The loan is secured on certain freehold properties.

42

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 CONTINUED

14 Creditors: amounts falling due after more than one year (continued)

The other loan is repayable by instalments

The other loan is repayable by instalments
2023 2022
£ £
Over 5 years 1,025,000 1,150,000
Within 2 to 5 years 375,000 375,000
Within 1 to 2 years 125,000 125,000
1,525,000 1,650,000
Within 1 year (see note 13) 125,000 71,376
1,650,000 1,721,376

The other loan is in respect of the Asset Purchase of Airthrie School LLP and is secured on certain freehold property. The loan is repayable over a 15 year term and annual repayments commenced on 5 July 2022. The interest rate is fixed at 1%.

15 Creditors: composition fees

Parents may pay the school tuition fees in advance. The money may be returned subject to specific conditions. Assuming pupils will remain in the Charity’s schools, the amounts due will be applied as follows:

Group and Group and
Foundation Foundation
2023 2022
£ £
Greater than 5 years - 59,637
Within 2 to 5 years 442,148 563,397
Within 1 to 2 years 368,931 475,749
811,079 1,098,783
Within 1 year (see note 13) 620,706 825,626
1,431,785 1,924,409

Discounts are given on composition fee accounts in accordance with the rate as set out in the individual signed agreements.

The balance represents the accrued liability under the contracts. The movements during the year were:

£
Balance at
1 September 2022		 1,924,409
New contracts 537,466
Refunds (136,131)
Amounts utilised in payment offees to the Charity (930,673)
Discounts given 36,714
Balanceat31August2023 1,431,785

43

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

16 Hire purchase and finance leases

Minimum lease payments under hire purchase fall due as follows:

Group Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Within one year 75,171 57,041 37,933 20,685
Between 1 — 5 years 188,114 145,660 131,988 71,403
263,285 202,701 169,921 92,088

The assets held under hire purchase are in respect of plant & equipment.

17 Financial instruments

Group __Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Financial assets measured at fair 3,296,063 3,296,063 3,088,732 3,088,732
value

Financial assets held at fair value include assets held as investments.

18 Net assets of the funds of the Group and The Dean Close Foundation

The net assets held as at 31 August 2023 for the various funds are as follows:

Goodwill Fixed assets Net current
on and (liabilities)/ Long term
consolidation
£		 Investments
£		 assets
£		 liabilities
£		 Total
£
Endowed funds - 491,285 - - 491,285
Restricted funds - 530,617 - - §30,617
General funds - 36,285,168 (10,085,013) (9,710,519) 16,489,636
Foundation - 37,307,070 (10,085,013) (9,710,519) 17,511,538
Subsidiary and other (945,947) 332,429 901,735 (42,454) 245,763
funds
Consolidation 1,389,500 (1,519,500) - - (130,000)
adjustments
Group 443,553 36,119,999 (9,183,278) (9,752,973) 17,627,301

44

\

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 CONTINUED

18 Net assets of the funds of the Group and the Dean Close Foundation (continued)

Goodwill Fixed assets Net current
Comparative 2022 on
consolidation		 and
Investments		 assets/
(liabilities)		 Long term
liabilities		 Total
£ £ £ £ £
Endowed funds - 510,936 - - 510,936
Restricted funds - 377,118 - - 377,118
General funds - 35,392,135 (8,517,150) (10,210,802) 16,664,183
Foundation - 36,280,189 (8,517,150) (10,210,802) 17,552,237
Subsidiary and (945,947) 241,443 903,039 (60,585) 137,950
other funds
Consolidation 1,500,388 (1,630,388) - - (130,000)
adjustments
Group 554,441 34,891,244 (7,614,111) (10,271,387) 17,560,187

18(a}) Endowed funds: Movements in the year (Group and Foundation)

Balance
Balance at at 31
1 September Incoming Amounts August
2022 endowments expended Transfers 2023
£ £ £ £ £
Permanent endowments:
ArtsCouncilGrant 510,936 - - (19,651) 491,285

The grant received from the Arts Council in respect of the construction in 1997 of the new Music School amounted to £982,561. This is being amortised over the useful life of the Music School, with the amortisation charge of £19,651 for the year being transferred to unrestricted funds.

The grant is an endowment fund by virtue of its purpose being to provide Arts in the community by building the Music School and is subject to certain conditions being met.

Balance
Comparative 2022 Balance at at 31
1 September
2021		 Incoming
endowments		 Amounts
expended		 Transfers August
2022
£ £ £ £ £
Permanent endowments:
ArtsCouncilGrant 530,587 - - (19,651) 510,936

45

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 CONTINUED

18(b) Restricted funds: Movements in the year (Group and Foundation)

Transfers Balance
Balance at and at 31
1 September Incoming Amounts Investment August
2022 resources expended Losses 2023
£ £ £ £ £
Prize, Bursary and
otherfunds
Quad Redevelopment		 364,093
121		 318,168
-		 (149,797)
-		 (14,751)
(121)		 §17,713
-
Private Family
Charitable Trust 12,904 - - - 12,904
377,118 318,168 (149,797) (14,872) 530,617
Prize, Bursary and other funds consist of
a number of individual bequests		 received from individual
donors and are utilised in accordancewith donors’ wishes. TheQuad Redevelopment fund consisted
of
a numberofdonations receivedfrom individual donors and were utilised		 in accordance with donors’
wishes to assist with the funding of the Academic Quad Redevelopment at the Senior School.
£498,635 was transferred into the unrestricted fund during 2022 on completion of the Quad
Redevelopment.
Transfers Balance
Comparative
Funds 2022		 Balance at
1 September		 Incoming Amounts and
Investment		 at31
August
2021 resources expended gains 2022
£ £ £ £ £
Prize, Bursary and other
funds		 247,807 234,089 (102,778) (15,025) 364,093
Quad Redevelopment 498,635 121 - (498,635) 121
Private Family Charitable
Trust 12,904 - - - 12,904
759,346 234,210 (102,778) (513,660) 377,118

Prize, Bursary and other funds consist of a number of individual bequests received from individual donors and are utilised in accordance with donors’ wishes. The Quad Redevelopment fund consisted of a number of donations received from individual donors and were utilised in accordance with donors’ wishes to assist with the funding of the Academic Quad Redevelopment at the Senior School. £498,635 was transferred into the unrestricted fund during 2022 on completion of the Quad Redevelopment.

46

A

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

18(c) Unrestricted funds: Movements in the year

1 Balance at
September		 Incoming Amounts Transfersand __Balance at
Investment
31 August		 Transfersand __Balance at
Investment
31 August
2022 resources expended losses 2023
£ £ £ £ £
General fund 16,672,133 29,980,338 (29,969,355) (77,717) 16,605,399

The General fund includes £16,489,636 (2022: £16,664,183) net assets in respect of funds held by the Foundation. On consolidation, amortisation of goodwill totalling £110,888 was added to the amounts expended which is included in the figure above. Transfers and Investment losses within the General fund include £19,651 transferred from endowed funds. Further details of the transfers are included in notes 18a and 18b.

Comparative 2022 Balance at
1 September		 Incoming Amounts Transfers and __Balance at
Investment
31 August		 Transfers and __Balance at
Investment
31 August
2021 ~+=resources Expended gains 2022
£ £ £ £ £
Generalfund 16,753,380 27,851,535 (28,125,108) 192,326 16,672,133

19 Capital commitments

The Group and Foundation had capital commitments at 31 August 2023 contracted for but not provided in these accounts of ENil (2022: £292,255 for freehold property and fixtures and fittings).

20 Operating lease commitments

The total future minimum lease payments under non-cancellable operating leases are as follows:

Group Foundation Group Foundation
2023 2023 2022 2022
£ £ £ £
Expiring within 1 year 444,009 444,009 398,777 398,777
Expiring within 1 to 5 years 1,166,043 1,166,043 1,135,600 1,135,600
Expiring greaterthan5years 1,196,809 1,196,809 1,412,400 1,412,400

47

THE DEAN CLOSE FOUNDATION NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 CONTINUED

21 Pension Schemes

The Charity participates in the Teachers’ Pension Scheme (“the TPS”) for the majority of its teaching staff. The pension charge for the year includes employer contributions payable to the TPS of £1,399,026 (2022: £1,521,444) and at the year-end £159,475 (2022: £156,988) was accrued in respect of contributions to this scheme.

The TPS is an unfunded multi-employer defined benefits pension scheme governed by The Teachers’ Pensions Regulations 2010 (as amended) and The Teachers’ Pension Scheme Regulations 2014 (as amended). Members contribute on a “pay as you go” basis with contributions from members and the employer being credited to the Exchequer. Retirement and other pension benefits are paid by public funds provided by Parliament.

The employer contribution rate is set by the Secretary of State following scheme valuations undertaken by the Government Actuary’s Department. The most recent actuarial valuation of the TPS was prepared as at 31 March 2020 and the Valuation Report, which was published in October 2023.

Following the McCloud judgement, the remedy proposed that when benefits become payable, eligible members can select to receive them from either the reformed or legacy schemes for the period 1 April 2015 to 31 March 2022. The actuaries have assumed that members are likely to choose the option that provides them with the greater benefits, and in preparing the 2020 valuation have valued the “greater value” benefits for groups of relevant members.

The valuation confirmed that the employer contribution rate for the TPS would increase from 23.6% to 28.6% from 1 April 2024. Employers are also required to pay a scheme administration levy of 0.08% giving a total employer contribution rate of 28.68%.

The Charity also operates one workplace pension scheme (2022: three) on a defined contribution basis. Employer contributions for the year amounted to £286,861 (2022: £180,194), and at the year-end £65,829 (2022: £52,924) was accrued in respect of contributions to this scheme.

22 ~ Post balance sheet events

On 1 September 2023, the Charity exchanged contracts for the purchase of a property in Cheltenham at an agreed price of £850,000. Completion took place on 14 September 2023 and the cost was financed by a term loan (see note 14).

23 ~+Related party transactions

In accordance with CC29 — Conflicts of interest: A guide for charity Trustees, certain transactions between Trustees and the Charity are disclosable.

There were no disclosable transactions during the year (2022: £422 with Painswick Garden Estates of which Mrs H S L Daltry was a Director and at the year end, £Nil was owed by The Dean Close Foundation). A donation of £12,500 was received from 1 Trustee during the year (2022: £13,750 from 1 Trustee and a close family member).

Apart from the aforementioned items, there were no related party transactions in the year or prior year, with the exception of those Trustees and key management who have children attending the Charity’s schools. School fees incurred by Trustees are paid on a commercial arms’ length basis, whilst key management can benefit from a staff concession that can be available to all eligible members of staff who have children attending the Foundation.

See note 3(a) and 3(b) for details of the transactions which took place between the Charity and its wholly owned subsidiaries, Dean Close Services Limited and Dean Close Nurseries Limited in the year and any amounts outstanding at the year end.

The Ministry of Defence provides some funding each year for the purposes of the Dean Close Combined Cadet Force (CCF). A separate CCF bank account is held by the Charity. The CCF bank account balance as at 31 August 2023 was £9,739 (2022: £6,653).

48

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2023 (CONTINUED)

24 Analysis ofchanges in net debt (Group) Analysis ofchanges in net debt (Group)
Balance at Othernon- Balance at
1 September cash 31 August
2022 Cash flows changes 2023
£ £ £ £
Cash and cash equivalents
Cash
Overdraft		 84,724
(220,262)		 (16,946)
(1,396,589)		 -
-		 67,778
(1,616,851)
(135,538) (1,413,535) - (1,549,073)
Due within one year
Bank and other loans (502,887) (210,722) 134,609 (579,000)
Hire purchase obligations (37,933) (59,947) 22,709 (75,171)
Due greaterthan one year
Bank and other loans (9,040,616) - 286,836 (8,753,780)
Hire purchase obligations (131,988) - (56,126) (188,114)
Total (9,848,962) (1,684,204) 388,028 (11,145,138)

49

THE DEAN CLOSE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED CONTINUED

31 AUGUST 2023

25 Consolidated Statement of Financial Activities - Comparative figures by fund

Unrestricted Restricted Endowed
funds funds funds Total
Notes 2022 2022 2022 2022
£ £ £ £
income from:
Charitable activities
School fees receivable 2 22,532,816 - - 22,532,816
Ancillary trading income 4 289,940 - - 289,940
Othertrading activities
Non-ancillary trading income 3 4,946,671 - - 4,946,671
Investments
Investment income 11(c) 68,704 35,825 - 104,529
Bank and other interest 13,355 - - 13,355
Voluntary sources
Grants and donations 49 198,385 - 198,434
Total incoming resources 27,851,535 234,210 - 28,085,745
Expenditure on:
Raising funds
Non-ancillary trading 3 4,039,683 - - 4,039,683
Financing costs 356,330 - - 356,330
Investment management 22,690 723 - 23,413
Fundraising and development 117,952 - - 117,952
Total deductible costs 7 4,536,655 723 - 4,537,378
Charitable activities
Education and grant making 23,588,453 102,055 - 23,690,508
Total expenditure 7 28,125,108 102,778 - 28,227,886
Net outgoing funds from operations (273,573) 131,432 - (142,141)
before transfers and investment losses
Losses on investments (330,460) (10,525) - (340,985)
Transfers between funds 522,786 (503,135) (19,651) -
Net movement in funds (81,247) (382,228) (19,651) (483,126)
Fund balances at
1 September
2021 16,753,380 759,346 530,587 18,043,313
Fund balances at 31 August
2022 18 16,672,133 377,118 510,936 17,560,187

50