**The Royal Grammar School, Guildford Foundation** 

## **Directors’ Report & Financial Statements** 

## **For the Year Ended** 

**31st July 2022** 

**Registered Number 4232306 Charity Number 1089955** 



**The Royal Grammar School, Guildford Foundation** 

||**Contents**||
|---|---|---|
|||**Page**|
|**Aims, Objectives and Activities**||**1‐2**|
|**Review of Activities and Achievements**|**2021‐2022**|**2‐3**|
|**Future Plans**||**3**|
|**Status, Governance and Management**||**3‐4**|
|**Principal Risks and Uncertainties**||**5**|
|**Financial Review**||**5‐6**|
|**Reference and Administrative Details**||**7**|
|**Statement of Directors’ Responsibilities**||**8**|
|**Report of the Independent Auditors**||**9‐11**|
|**Statement of Financial Activities**||**12**|
|**Balance Sheet**||**13**|
|**Cashflow Statement**||**14**|
|**Accounting Policies**||**15‐16**|
|**Notes to the Financial Statements**||**17‐19**|





**The Royal Grammar School, Guildford Foundation                                                          Review of Activities and Achievements** 

## **Aims and Objectives** 

1. The Directors, who are also the Trustees, of the Royal Grammar School, Guildford Foundation (‘The Foundation’) present their annual report and audited financial statements for the year ended 31st July 2022 and confirm they comply with the requirements of the Companies Act 2006, Charities Act 2011, the trust deed and the FRS 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland. 

## **Our Aims** 

2. The Foundation is established to promote, provide and raise funds for the charitable purposes of Royal Grammar School Guildford (the School) and otherwise to promote any other charitable purpose connected or otherwise associated with the School. 

3. The Trustees have considered the stated object in the light of the Charity Commission’s general guidance on public benefit and the consultation draft on supplementary guidance on “Public Benefit and the Advancement of Education”. They are satisfied that the object is for the advancement of education and that there is an identifiable public benefit that is available to a section of the public, being the pupils/recipients of education at the School. 

## **Our Objectives** 

4. The Foundation has two key objectives: to raise funds, especially for bursaries, and to build a supportive community of parents, alumni and others who can offer financial and non‐financial support to the School. Both are achieved by developing relationships with individuals within the wider School community. 

5. The Trustees are aware that the generation of funds for the benefit of the School will assist it in its endeavour to ensure that all boys who meet the entrance criteria may have the opportunity to attend the School, regardless of the financial means of their parents. 

## **Our Activities** 

6. In 2014 a five‐year strategy, based on developing a philanthropic culture and building a long‐term fundraising plan for bursaries was launched.  The key priorities identified are to build a culture of giving through the school community, to steward existing donors so that their support would extend into the future and to give time and resource to a major donor programme. Following the set‐backs of the coronavirus pandemic in 2020‐21, the first phase of the campaign for bursaries resulting from that strategy came to a successful conclusion in the Autumn of 2021. 

7. The Foundation’s fundraising activities to date have been based on recruiting regular gifts to ensure predictable, tax efficient income streams. Initiatives include the operation of a Friends scheme and a variety of higher‐level regular‐giving opportunities. Legacy gifts are a less regular but highly valued contribution. Income is also sought from Trusts & Foundations in support of bursaries and from corporate sources for sponsorship activities such as events, technology or staff investment. Merchandise is sold to promote awareness of the School.  Stewardship programmes are in place for the various fundraising initiatives. All activities promote ongoing engagement through sharing the impact of philanthropic support. 

8. On finishing school, all pupils become Old Guildfordians and are automatically included in the alumni programme.  This programme of communications and events is managed and run by the Development & Alumni Relations office (DARO). 

1 



**The Royal Grammar School, Guildford Foundation                                                          Review of Activities and Achievements** 

9. The Development & Alumni Relations Office also manages a professional and social networking platform – RGS Connect.  Launched in May 2017, it offers members of the RGS community the opportunity to ‘give back’ through the sharing of skills, knowledge and experience.  The platform and other connections are also used to organise a series of sector‐specific career seminars, in conjunction with the Higher Education & Careers team, for the benefit of boys at the School and pupils from the local secondary schools. 

10. The Directors have considered all the activities of the Charity against the Commission’s Public Benefit Guidance and are of the opinion that the mix of practical support for education and fundraising for a registered educational establishment and the provision of educational events to which other schools are invited delivers public benefit consistent with the Charity’s aims and thereby meets the public benefit principles. In particular, fundraising for bursaries generates funds intended to ensure that access to the School is as open as possible to families of all means. 

## **Review of Activities and Achievements 2021‐22** 

## **Fundraising** 

11. The Foundation generated incoming resources of £1,434,329 for the year 2021‐22. This was comprised of a £1,000,000 unbudgeted legacy and £434k of fundraising income. Principal Income sources included: 

- a) Legacy donation 

- b) Major Donor regular giving 

- c) ‘Class of…’ fellowship giving from the parents of U6 Leavers 

- d) Friends of the RGS 

- e) Sales of merchandise 

- f) Unsolicited gifts 

12. The majority of the funds raised by the Foundation are made tax efficiently through the government’s Gift Aid scheme. Donations are allocated in line with donors’ wishes where specified. Unrestricted funds are currently applied to the School’s funding priority, which is bursaries. The day to day running costs of the Foundation and the Development & Alumni Relations Office are met by the School, not from donated income. 

This year, on completion of the 20 for 2020 Campaign and with changes in the development office including the transition between development directors and a wish to move focus to a long‐term strategy, fundraising initiatives such as a Giving Day or a Telephone Campaign were paused. 

13.    Donor stewardship remains central to the Foundation’s fundraising activity. This year, the development and alumni office produced a new and updated version of the annual Supporters Review, celebrating the impact and sharing the successful results of the 20 for 2020 Campaign.  Supporters were also invited to the annual Supporters Reception to celebrate, alongside the Headmaster, the Chair of Governors, Foundation Trustees and key members of staff, the year’s philanthropic successes. This marked the first fully Supporters’ celebration, following previous online events held in 2020 and a restricted event to mark the end of the 20 for 2020 Campaign in October 2021. 

2 



**The Royal Grammar School, Guildford Foundation                                                          Review of Activities and Achievements** 

## **Alumni Relations & Communications** 

14.    The Development and Alumni Relations Office maintained contact with the alumni and former, as well as current, parent community through a full series of printed and online communications as well as in person and online events. The various activities included: 

- a) Two online alumni (OG) quizzes 

- b) Two fully subscribed ‘Breakfast Club online talks’ featuring distinguished members of the Old Guildfordian community including a Nobel laureate OG 

- c) A legacy ‘lunch’ meeting for the Beckingham Society, the alumni legacy members 

- d) A King’s Lecture with TV Sports Personality and OG 

- e) Concert services at Holy Trinity Church 

- f) Continued phone contact and stewardship with older OGs 

- g) Production of the OG magazine DialOGue 

- h) Weekly email newsletter to the RGS Community informing them of notable events both in the wider RGS community 

- i) Anniversary reunions celebrating the 30[th] anniversary and 50[th] anniversary graduating classes 

- j) Anniversary lunches and teas for OGs from the 1960s and earlier 

- k) A young OG event with current members of staff for OGs in Cambridge 

## **Careers & Pupil support** 

15.    In 2021‐22, the development and alumni office continued to provide help and assistance as well as organisation and logistics to the Careers programme held in School and aimed at a wider audience of current students, including state school pupils from the wider Surrey area. Support was provided in the organisation of the Career programme aimed at future Engineers. Four young Old Guildfordians working in Engineering came back to share precious insights from their fields ranging from civil and structural engineering to robotics and aerospace. The audiences of current RGS students and other students were in their hundreds. 

## **Future Plans & “Road to 2035” Campaign** 

16.     The Headmaster’s long‐term vision, that RGS Guildford will achieve full merit‐based open access within a generation, continued to influence and shape the future strategic development plans.  Our aim is for every boy who earns his place at the School by merit is able to take it up, irrespective of financial circumstances within his family. The vision led to the creation of the “Road to 2035” Campaign which aims to build a long‐ term investment fund to support bursaries into the future for the School just in time to celebrate the School’s 525[th] anniversary. 

17.    The Campaign aims to encourage major donations and legacy focused giving alongside the regular cycle of multi‐year donations.  Key to this strategy is to continue to embed the ethos of ‘widening access’ at all levels of the RGS community and grow a shared philanthropic culture internationally so that by 2035 the School will be in a position to provide bursary support to every boy who qualifies. The multi‐year Campaign will be launched in the 2022‐23 financial year. 

## **The Status of the Foundation** 

18. The Foundation is a Company limited by guarantee and has no share capital. The Foundation has one voting member, 1509 Group, which undertakes to contribute an amount not exceeding £10 to the assets of the Foundation in the event of it being wound up whilst it is a member, or within one year of its ceasing to be a member.  If, on the winding up or dissolution of the Foundation, there remains any property this shall be distributed to 1509 Group or to some other charitable institute or institutions having objects similar to the objects of the Foundation. The 1509 Group is the parent undertaking of the Foundation. The 1509 Group is the holding company of both Foundation and Royal Grammar School Guildford. 

3 



**The Royal Grammar School, Guildford Foundation                                                          Review of Activities and Achievements** 

## **The Directors, Officers and Advisors** 

19.  There are currently four Directors. 1509 Group appointed one Director. The remaining Directors were appointed by the member, on the recommendation of the School.  We were pleased to welcome Chris Alder to the Board in November 2021. The names of all the Directors of The Royal Grammar School, Guildford Foundation and of the Officers and Advisors to the Foundation are set out on page 7. 

20.  Directors, who are also charity trustees, are selected for their commitment to our philanthropic ambitions, their networks and connections to help raise funds and their knowledge and experience of the School. 

21.  All Directors give their time freely and no remuneration or expenses were paid in the year. No Director or person connected with a Director received any benefit from either means tested bursaries or scholarships awarded to the School’s pupils. 

## **Recruitment and Training of Trustees** 

22. The Headmaster, Chair of Governors and existing trustees work with the Development Director to identify prospective Trustees and assist in their induction. Prospective trustees are invited to a number of School events in order to meet members of the school leadership team and are given considerable background material regarding the School, its philanthropic history and current fundraising strategy. The legal and fiduciary responsibilities as a charity trustee are made clear as well as the primary role of Foundation trustees as fundraisers and networkers. Every prospective trustee will meet at least one other existing trustee independently before taking up the position. Induction includes a visit to the School, the opportunity to meet key staff members and sessions with the Development Director and Bursar regarding fundraising and the Foundation strategy, School and Foundation finances and School governance respectively. Most trustees will have been recruited through an existing trustee who will provide mentoring support as needed. Where a trustee has been recruited by a staff member or School leadership, a trustee will be appointed to offer this support. 

23.  Trustee Terms of Reference and a Memorandum of Understanding between the School and Foundation are both in place. 

## **Administration** 

24. The Directors are responsible for the strategic management of the Foundation.  By agreement between the School and the Foundation, the School provides administrative resources for the Foundation free of charge, thus allowing the Directors and officers to concentrate their efforts on the tasks of supporting the School and of fundraising. Day to day operational management is delegated to the Development Director, who is not a director of the Company. Financial matters are overseen by the Treasurer. 

4 



**The Royal Grammar School, Guildford Foundation                                                          Financial Review** 

## **Financial Review** 

25. The Foundation received £1,431,678 (2020‐21: £839,039) through donations and legacies, with restricted donations totalling £1,431,055 (2020‐21: £837,979).  Sale of merchandise generated a further £2,518 (2020‐21: £2,347) during the year. Corresponding cost of sales came to £1,815 (2020‐21: £729). The Foundation donated £340,161 (2020‐21: £339,500) to the School during the year. 

26. The School has agreed to provide, free of charge, the administrative resources for the Foundation’s fundraising, alumni relations and development work in the expectation that significant donations and other benefits will be generated for the School. 

Budgets and cashflow forecasts have been prepared which cover the period to July 2024. These include consideration of the key risks alongside the company’s planned response and sensitivity analysis around significant assumptions. Accordingly, the trustees believe the School’s financial resources alongside the plans they have in place are sufficient to ensure the Foundation will continue as a going concern for the foreseeable future, being at least 12 months from the date of approval of the financial statements and have therefore prepared the financial statements on a going concern basis. 

## **Principal Risks and Uncertainties** 

27.   The Directors review the Foundation’s risk assessments at least annually, and more frequently if appropriate to take into account changing circumstances. 

The main risks are identified as: 

- a) Failure of the School to adopt a fully integrated approach to fundraising, from strategy to communications, leading to an inability to realise the philanthropic funds needed to achieve the School’s stated aim of full merit‐based open access within a generation. The Governors have convened a working party of Governors, Trustees and staff to address this issue and make recommendations to the School. 

- b) Cyber‐attack, causing major theft, loss or corruption of data or systems, which could damage the Foundation’s operations or reputation. The safety of systems is regularly reviewed along with the development of disaster recovery systems, the review of policies and passwords, with updates and training for staff on these. 

- c) Incidence of a pandemic or other major event adversely affecting fundraising activities and donor finances. Regular meetings of the Foundation Board have been convened to address the emerging issues and needs and a revised fundraising plan has been prepared in light of the situation. Performance against revised plans and forecast is regularly reviewed to monitor cash and operational resources. Fundraising campaigns and initiatives are being conducted on‐line and active stewardship of the existing donor base continues. 

- d) Data protection changes which could lead to a significant drop in the number of those from the RGS community with whom the Foundation can communicate. Work is ongoing with the Bursar to ensure that data capture and collection activity continues to be legal and effective for fundraising and marketing purposes. 

- e) Cost of living pressures on the donor community. 

5 



**The Royal Grammar School, Guildford Foundation                                                          Financial Review** 

## **Sources of Funding** 

28. Almost all of our funding comes from alumni of the School (called Old Guildfordians) and parents and staff, past and present.  In recent years profits from the overseas ventures of the 1509 Group have also been gifted to the Foundation to support bursaries. Additionally, in years where there is a surplus of bursary budget over bursary need in the School, the balance is gifted to Foundation to support future bursaries. A small number of Trusts & Foundations also offer their support. 

29.  The Foundation’s fundraising activities are carried out by an in‐house staff team, funded by the School. No professional fundraising organisations or commercial participators are currently used by the Foundation. The Foundation adheres to the Code of Fundraising Practice when undertaking fundraising activity. Fundraising activity is limited to those with an existing connection to the School and includes a limited amount of funding from Trusts. Major donor and one‐to‐one fundraising is the Foundation’s key mode of fundraising which helps to ensure that philanthropic relationships are not developed with anyone who might be vulnerable or be in vulnerable circumstances. There were no complaints received by the Foundation in respect of fundraising activity. 

## **Investment and Reserves Policy** 

30.  The Foundation’s Enduring Bursary Fund continues to grow, in line with its long term strategy.  The fund is grown using specific legacy and restricted gifts, any surplus in unrestricted gifts to the Foundation and any unspent funds from the School’s annual bursary allocation.  Funds are currently being held on deposit.  The Fund may be used if there is a shortfall in philanthropic funding in a given year, to meet bursary commitments. 

31.  The Foundation’s total reserves of £2,091k at the year‐end (2020‐21: £1,004k) included £1,961k of unspent restricted income (2020‐21: £875k), and £131k of unrestricted income (2020‐21: £129k). The Foundation does not seek to carry significant levels of free reserves for contingency purposes. 

32. Funds and other donations received for the School have been passed on in a timely manner, to be used for the purposes for which they were nominated.  The Directors have reviewed the financial performance of the charity and believe there are sufficient funds to continue operating for the foreseeable future and there are no material uncertainties surrounding the Foundation’s ability to continue as a going concern. The accounts of the charity have therefore been prepared on a going concern basis. 

## **Disclosure of Information to Auditors** 

33. The Directors who held office at the date of approval of this Directors’ Report confirm that, so far as they are individually aware, there is no relevant audit information of which the Company’s auditors are unaware, and each Director has taken all reasonable steps that they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company’s auditors are aware of that information. 

6 



**The Royal Grammar School, Guildford Foundation                              Reference and Administrative Details** 

## **Directors** 

1509 Group Appointed by RGS H Styche‐Patel Appointed by the member J Eves Appointed by the member C Alder Appointed 23 November 2021 

## **Honorary Officers** 

The Headmaster J M Cox Secretary & Treasurer C M Perceval 

## **Registered Office** 

The Royal Grammar School High Street Guildford Surrey GU1 3BB 

## **Advisors** 

**Principal Bankers** National Westminster Bank Plc Guildford Commercial Office PO Box 1, 2[nd] Floor G3 Guildford Surrey GU1 3ZR **Auditors** Crowe U.K. LLP 55 Ludgate Hill London EC4M 7JW **Solicitors** Barlow Robbins LLP The Oriel Sydenham Road Guildford Surrey GU1 3SR **Company Number** 04232306 **Charity Number** 1089955 

7 



**The Royal Grammar School, Guildford Foundation                         Statement of Directors' Responsibilities** 

## **Statement of Directors’ Responsibilities** 

The purpose of this statement is to distinguish the Directors’ responsibilities for the Financial Statements from those of the auditors as stated in their report. 

Company and Charity law require the Directors to prepare Financial Statements for each financial year that give a true and fair view of the state of affairs of the Company and of the surplus or deficit of the Company for that year. 

Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.  In preparing those Financial Statements the Directors are required to: 

- select suitable Accounting Policies and then apply them consistently; 

- observe the methods and principles of the Charities’ SORP; 

- make judgments and estimates that are reasonable and prudent; 

- state where applicable United Kingdom Accounting Standards have been followed, subject to any material departures in the financial statements disclosed and explained; 

- prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. 

The Directors are responsible for maintaining adequate accounting records which disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the Financial Statements comply with the Companies Act 2006.  They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 

## **Auditors** 

Crowe U.K. LLP has indicated willingness to continue in office and a resolution concerning their reappointment will be proposed at the Annual General Meeting. 

Approved by the Directors and signed on their behalf by: 

**Director Director Print name** Heather Styche‐Patel **Print name** Sarah Creedy **Date** 14[th] December 2022 **Date** 14[th] December 2022 

8 



**The Royal Grammar School, Guildford Foundation                                                             Report of the Independent Auditor** 

## **Independent Auditor’s Report to the Members of The Royal Grammar School, Guildford Foundation** 

## **Opinion** 

We have audited the financial statements of The Royal Grammar School, Guildford Foundation (‘the charitable company’) for the year ended 31st July 2022 which comprise the Statement of Financial Activities, Charity Balance Sheet, Statement of Cash Flows and notes to the financial statements, including 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: 

- give a true and fair view of the state of the charitable company’s affairs as at 31st July 2022 and of the charitable company’s income and receipts of endowments and expenditure, for the year then ended; 

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and 

- have been prepared in accordance with the requirements of the Companies Act 2006. 

## **Basis for opinion** 

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

## **Conclusions relating to going concern** 

In auditing the financial statements, we have concluded that the 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 or 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. 

9 



**The Royal Grammar School, Guildford Foundation                                                             Report of the Independent Auditor** 

## **Opinions on other matters prescribed by the Companies Act 2006** 

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

- the information given in the trustees’ report, which includes the directors’ report and the strategic report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and 

- the strategic report and the directors’ report included within the trustees’ report have been prepared in accordance with applicable legal requirements. 

## **Matters on which we are required to report by exception** 

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: 

- adequate and proper accounting records have not been kept; or 

- the financial statements are not in agreement with the accounting records and returns; or 

- certain disclosures of trustees' remuneration specified by law are not made; or 

- we have not received all the information and explanations we require for our audit. 

## **Responsibilities of trustees** 

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non‐compliance with laws and regulations are set out below. 

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

## **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 identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion. 

10 



**The Royal Grammar School, Guildford Foundation                                                             Report of the Independent Auditor** 

We obtained an understanding of the legal and regulatory frameworks within which the charitable company 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 Companies Act 2006, taxation legislation, employment legislation and general data protection legislation, 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 charitable company’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company for fraud. The laws and regulations we considered in this context for the UK operations was the Companies Act 2006. 

Auditing standards limit the required audit procedures to identify non‐compliance with these laws and regulations to enquiry of the 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 within the timing and recognition of donation income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management and the Finance and General Purposes Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission 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. 

## **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. 

Tina Allison Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor 

London 

> 16 December 2022 

11 



**Royal Grammar School, Guildford Foundation Statement of Financial Activities 31st July 2022** 

**Registered Number 4232306** 

## **STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING THE INCOME AND EXPENDITURE ACCOUNT)** 

|**Notes**<br>**Income From:**<br>Donations and legacies<br>**1 (a)**<br>Income from trading activities<br>**1 (b)**<br>Investment Income<br>**1 (c)**<br>**Total incoming resources**<br>**Expenditure on:**<br>Charitable activities<br>**2 (a)**<br>Raising funds<br>**2 (b)**<br>**Total expenditure**<br>**NET MOVEMENT IN FUNDS**<br>Fund balances brought forward at 1 August 2021<br>**Fund balances carried forward at 31 July 2022**|**Unrestricted**<br>**Funds**<br>**£**<br>623<br>2,518<br>133<br>3,274<br>‐<br>1,871|**Restricted**<br>**Funds**<br>**£**<br>1,431,055<br>‐<br>‐<br>1,431,055<br>340,161<br>4,987|**2021‐2022**<br>**2020‐2021**<br>**Total**<br>Total<br>**£**<br>**£**<br>1,431,678<br>839,038<br>2,518<br>2,347<br>133<br>129|
|---|---|---|---|
||||1,434,329<br>841,514|
||||340,161<br>367,580<br>6,858<br>44,931|
||1,871|345,148|347,019<br>412,511|
||1,403<br>129,171|1,085,907<br>874,620|1,087,310<br>429,003<br>1,003,791<br>574,788|
||**130,574**|**1,960,527**|**2,091,101**<br>**1,003,791**|



The Company has no gains or losses that are not shown above. 

The accounting policies and notes on pages 15 to 19 form part of these Financial Statements. 

12 



**Royal Grammar School, Guildford Foundation Balance Sheet 31st July 2022** 

**Registered Number 4232306** 

|**Notes**<br>**CURRENT ASSETS**<br>Stock<br>**4 (a)**<br>RGS Debtor<br>Gift Aid receivable<br>Prepayments<br>Cash<br>**CREDITORS:  due within one year**<br>**4 (b)**<br>**TOTAL NET ASSETS**<br>**5**<br>**Represented by:**<br>**RESTRICTED FUNDS**<br>**5**<br>**UNRESTRICTED FUNDS**<br>Designated and general funds<br>**5**<br>**Total funds**|**31st July 2022**<br>**£**<br>20,430<br>136,000<br>61,513<br>541<br>2,213,085<br>2,431,569<br>(340,468)<br>2,091,101<br>1,960,527<br>130,574<br>2,091,101|**31st July 2021**<br>**£**<br>19,968<br>91,000<br>11,956<br>541<br>904,261|
|---|---|---|
|||1,027,726<br>(23,935)|
|||1,003,791|
|||874,620<br>129,171|
|||1,003,791|



Approved by the Board of The Royal Grammar School , Guildford Foundation and signed on behalf of the Company by 

Director Director Print name         Heather Styche‐Patel Print name       Sarah Creedy Date                   14th December 2022 Date                 14th December 2022 

The accounting policies and notes on pages 15 to 19 form part of these Financial Statements. 

13 



**Royal Grammar School, Guildford Foundation Cashflow 31st July 2022** 

**Registered Number 4232306** 

**2021‐2022** 

**2020‐2021** 

|**Cashflows from operating activities**<br>Net cash provided by operations<br>**Cash flows from investing activities**<br>Investment income receipts<br>**Changes in cash and cash equivalents in the**<br>**reporting  period**<br>**Cash and cash equivalents at 1 August**<br>**Cash and cash equivalents at 31 July**<br>**Net Cash Inflow/(Outflow)  from Operating**<br>**Activities**<br>Net Movement in funds<br>Increase/(Decrease) in Creditors<br>(Increase) in debtors and prepayments<br>Investment income<br>(Increase) in Stock<br>**Changes in Cash and Cash Equivalents**<br>**Analysis of Net Funds**<br>Net cash balances|133|1,308,691<br>133<br>**1,308,824**<br>**904,261**<br>**2,213,085**<br>**2021‐2022**<br>1,087,310<br>316,533<br>(94,557)<br>(133)<br>(462)<br>1,308,691<br>**As at**<br>**31st July 2022**<br>**000s**<br>2,213,085|129<br>**Cash Flow**<br>**000s**<br>1,308,824|382,658<br>129|
|---|---|---|---|---|
|||||**382,787**<br>**521,474**|
|||||**904,261**|
|||||**2020‐2021**<br>429,003<br>(24,514)<br>(20,816)<br>(129)<br>(886)|
|||||382,658|
|||||**As at**<br>**31st July 2021**<br>**000s**<br>904,261|



The accounting policies and notes on pages 15 to 19 form part of these Financial Statements. 

> [14] 



**The Royal Grammar School, Guildford Foundation                                                             Accounting Policies** 

## **Basis of accounting** 

The Financial Statements are prepared in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), the Charities Act 2011, 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). 

The accounts are drawn up on the historical cost accounting basis.  The directors have a reasonable expectation that the company has adequate resources to continue its activities for the foreseeable future and consider that there were no material uncertainties over the company’s financial viability.  Accordingly, they also continue to adopt the going concern basis in preparing the financial statements as outlined in the Statement of Directors’ Responsibilities on page 8. 

At the time of approval of the Annual Report, the COVID‐19 pandemic continues to evolve and the long term impact on the Foundation, in common with other entities, is unknown. As detailed in the financial review, Royal Grammar School Guildford bears the costs of the Foundation’s fundraising, alumni relations and development work. The Trustees believe the Schools’ financial resources are sufficient to ensure the Foundation will continue as a going concern for the foreseeable future, being at least 12 months from the date of approval of the financial statement and have therefore prepared the financial statements on a going concern basis. 

The Foundation is a Public Benefit Entity registered as a charity in England and Wales and a company limited by guarantee.  It was incorporated on 11th June 2001 (company number 42323060) and registered as a charity on 3rd January 2002 (charity number 1089955).  The Foundation’s registered office is The Royal Grammar School Guildford, High Street, Guildford, Surrey GU1 3BB. 

## **Critical accounting judgements and key sources of estimation uncertainty** 

In the application of the accounting policies the directors are required to make judgement, estimates, and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources.  The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant.  Actual results may differ from these estimates. 

The estimates and underlying assumptions are reviewed on an ongoing basis.  Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affected current and future periods. 

In the view of the directors no assumptions concerning the future or estimation uncertainty affecting assets or liabilities at the balance sheet date are likely to result in a material adjustment to their carrying amounts in the next financial year. 

15 



**The Royal Grammar School, Guildford Foundation                                                             Accounting Policies** 

## **Statement of Financial Activities (SOFA)** 

Transactions are analysed on the SOFA as follows: 

## **Unrestricted funds** 

   - ‘Foundation’ ‐ Expenses in furtherance of the charitable objective to support Royal Grammar School Guildford and the Company administration. 

   - ‘Designated’ ‐ Any funds designated for the general use of the Company or designated for use by the School. 

- **Restricted funds** 

- Any funds held on behalf of Royal Grammar School Guildford or for other restricted purposes. 

## **Stock** 

Stock is valued at the lower of cost and net realisable value. 

## **Income and expenditure** 

With the exception of voluntary income, income and expenditure is accounted for on an accruals basis. Voluntary incoming resources are accounted for as and when entitlement arises, the amount can be reliably quantified, and the economic benefit to the company is considered probable.  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 at the value to the company in the case of donated services or facilities. 

## **Donations and Legacies** 

Income from donations, grants and other sources is recognised on a cash basis and included in the Statement of Financial Activities (SOFA) when the Foundation is entitled to the income, when receipt is probable and when it can be measured reliably. Legacies subject to a life interest by another party will not be recognised. Pecuniary legacies will be recognised when the legacy is received or where there is sufficient evidence that receipt is probable. Residuary legacies are recognised at the earlier of cash received or notification of an interim distribution or estate accounts having been approved by the executors. 

## **Expenditure** 

Expenditure is allocated to expense headings either on a direct cost basis or apportioned according to time spent.  Expenditure is accrued as soon as a liability is considered probable, discounted to present value for longer term liabilities. 

## **Taxation** 

As a registered charity the Foundation is generally exempt from Corporation Tax but not from Value Added Tax (VAT).  Irrecoverable VAT is included in the cost of those items to which it relates. 

16 



**Royal Grammar School, Guildford Foundation Notes to the accounts 31st July 2022** 

**Registered Number 4232306** 

## **1. Income** 

**(a)** Donations are received from Friends, other forms of regular donation, one‐off gifts and legacies. 

**(b)** Foundation continues to sell merchandise. The trading turnover relating to those sales, which are included in the income from trading activities, can be found below. 

|Sales Turnover<br>Cost of Sales<br>Net Turnover|**2021‐22**<br>**£**<br>2,448<br>(1,815)<br>633|**2020‐21**<br>**£**<br>2,347<br>(729)|
|---|---|---|
|||1,618|



**(c)** Investment income comprises interest on Gift Aid and bank interest. 

## **2. Charitable activities** 

**(a)** Donations received by the Foundation are passed on to the School following reclaim of tax under the Gift Aid scheme. 

**(b)** Costs in support of charitable activities include bank charges and the rental of equipment to allow acceptance of donations by debit and credit card, and totalled £4,997 (2021 ‐ £5,463) at the year end. 

## **3. Governance costs** 

Insurance premiums, audit fees and other statutory costs were paid for by the School on behalf of the Foundation. The Directors were not in receipt of any remuneration or expenses during the year. 

## **4. Current assets** 

**(a)** Stock consists of various merchandise unsold as of the year end. 

|**(b) Creditors:**amounts falling due within one year<br>Accruals<br>RGS creditor<br>Other creditors|**At 31st July**<br>**2022**<br>**£**<br>0<br>340,414<br>54<br>340,468|**At 31st July**<br>**2021**<br>**£**<br>33<br>21,904<br>1,998|
|---|---|---|
|||23,936|



## **5. Allocation of the Charity net assets** 

## **Restricted Funds** 

Restrticted Funds within the Foundation are made up of funds held which have been restricted by the donor.  When donations are passed to the school the restrictions remain with them. Restricted funds are mainly made up of the Bursary Fund which receives restricted bursary donations. 

- **(a)** The net assets at the balance sheet date are held for the various funds as follows : 

|**Unrestricted ‐ general**<br>**Total Funds**<br>**Restricted**|**Net current**<br>**Assets/**<br>**(Liabilities)**<br>**2022**<br>**£**<br>1,960,527<br>130,574<br>2,091,101|**Net current**<br>**Assets/**<br>**(Liabilities)**<br>**2021**<br>**£**<br>874,620<br>129,171|
|---|---|---|
|||1,003,791|



17 



**Royal Grammar School, Guildford Foundation Notes to the accounts 31st July 2022** 

**Registered Number 4232306** 

|||**Balance at**|**Net Income /**|**Donations**|**Grants and**|**Balance at**|
|---|---|---|---|---|---|---|
|**(b)**|Funds: movements in the year:|**31st July 2021**|**(expense)**||**Allocations**|**31st July 2022**|
|||**£**|**£**|**£**|**£**|**£**|
||**Restricted**|874,620|(4,987)|1,431,055|(340,161)|1,960,527|
||**Unrestricted ‐ General**|129,171|780|623|0|130,574|
|||1,003,791|(4,207)|1,431,678|(340,161)|2,091,101|
||**Comparative Allocation of the Charity net assets**||||||
|||**Balance at**|**Net Income /**|**Donations**|**Grants and**|**Balance at**|
||Funds: movements in the year:|**31st July 2020**|**(expense)**||**Allocations**|**31st July 2021**|
|||**£**|**£**|**£**|**£**|**£**|
||Restricted|409,661|(5,441)|837,980|(367,580)|874,620|
||Unrestricted ‐ General|165,127|(37,016)|1,060|0|129,171|
|||574,788|(42,457)|839,040|(367,580)|1,003,791|



## **6. Related party transactions** 

1509 Group is the sole voting Member of the Foundation, thus making it the Ultimate Parent Undertaking of both the Foundation and the School. The School makes available to the Foundation staff and logistical resources,without charge, in exchange for the Foundation's work programme in support of the School. At the year end Foundation owed the school £349,414 (2021 ‐ Foundation owed School £21,904). 

1509 Group is the holding company of both Foundation and Royal Grammar School Guildford. Copies of the consolidated accounts for the 1509 Group are available from the registered office at The Royal Grammar School, High Street, Guildford, Surrey GU1 3BB. 

In 2021/22, £340,161 (2020/21, £367,580) of donations was passed from Foundation to the School, to be used for the purposes for which the donations were nominated. 

Neither the trustees nor persons connected with them received any remuneration or other benefits from the Foundation or any connected organisations. Travel expenses are only reimbursed exceptionally, and with the prior approval of the Chairman. No expenses were reimbursed during the period. 

The Trustees donated £9,847 (excluding Gift Aid) to the Foundation in the year (2020/21 £10,584). 

18 



**Royal Grammar School, Guildford Foundation Notes to the accounts 31st July 2022** 

**Registered Number 4232306** 

|**7**<br>**Prior Year Statement of Financial Activities**<br>**Income and Expenditure Account**<br>**Income From**<br>Donations and legacies<br>Income from trading activities<br>Investment Income<br>**Income**<br>**EXPENDITURE**<br>**Expenditure on Charitable activities:**<br>Costs in support of<br>charitable activities<br>Costs incurred from<br>raising funds<br>**Total expenditure**<br>**NET MOVEMENT IN FUNDS**<br>**Fund balances carried**<br>**forward at 31st July 2021**<br>Fund balances brought<br>forward at 1st August 2020|**Unrestricted**<br>**Restricted**<br>**2020‐21**<br>**Funds**<br>**Funds**<br>**Total**<br>**£**<br>**£**<br>£<br>1,059<br>837,979<br>839,038<br>2,347<br>‐<br>2,347<br>129<br>‐<br>129|
|---|---|
||3,535<br>837,979<br>841,514|
||0<br>367,580<br>367,580<br>39,491<br>5,440<br>44,931|
||39,491<br>373,020<br>412,511|
||(35,956)<br>464,959<br>429,003<br>165,127<br>409,661<br>574,788|
||**129,171**<br>**874,620**<br>**1,003,791**|



19