2020-12-31-accounts

REGISTERED COMPANY NUMBER: 04699155 (England and Wales) REGISTERED CHARITY NUMBER: 1106429

Report of the Trustees and

Financial Statements

for the Year Ended 31 December 2020

for

THE PORTLAND TRUST

RSM UK Audit LLP 25 Farringdon Street London EC4A 4AB

THE PORTLAND TRUST

Contents of the Financial Statements for the year ended 31 December 2020

		Page
Report of the Trustees	1	to 14
Report of the Independent Auditors	15	to 17
Statement of Financial Activities		18
Balance Sheet		19
Cash Flow Statement		20
Notes to the Cash Flow Statement		21
Notes to the Financial Statements	22	to 29
Detailed Statement of Financial Activities	30	to 31

THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

The Trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31 December 2020. The Trustees have adopted the provisions of Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

Objectives and activities

Objectives and aims

The Portland Trust was incorporated on 17 March 2003 and gained charitable status on October 2004. The Portland Trust is a non-political organisation which is committed to driving initiatives that promote economic development, moderation and the resolution of conflict in the Middle East, in particular, the Israeli-Palestinian conflict.

Significant activities

The Portland Trust is involved with a number of initiatives to further its charitable aims. These include designing and coordinating programmes that aim to assist in the development of the Palestinian private sector and to reduce poverty in Israel through social investment and social entrepreneurship and collaborating with key partners at local and international level who can implement them.

A full description of projects currently being supported is given later in this report. This includes programmes which received direct funding from The Portland Trust during 2020 as detailed in the notes to the Financial Statements, as well as initiatives where The Portland Trust plays an advisory role offering guidance and non-financial support.

Public benefit

The objects of the Charity are for such exclusively charitable purposes for the benefit of the public in any part of the World as the Trustees' may in their absolute discretion think fit. When making decisions about the activities undertaken in furtherance of these objects, the Trustees follow the guidance issued by the Charity Commission regarding public benefit. This is demonstrated through involvement in projects benefiting society as a whole as detailed in this report.

Fundraising Declaration

The Portland Trust does not raise funds from the public and therefore has not subscribed to any fundraising standards or scheme for fundraising regulation.

Social investments

Working with local and international partners, The Portland Trust makes grants to develop the Palestinian private sector and the Israeli socio-economic periphery, mobilising additional resources and support where necessary.

In addition to making grants directly to beneficiaries, The Portland Trust also may make loans or investments where this is consistent with the Trust's charitable purposes and mission. Any Programme Related Investment would be monitored regularly by the Trustees to ensure that funds once invested continue to be used in furtherance of approved activities. The Social Investment Policy is reviewed annually or if there are significant changes in the Charity's commitments or activities.

Grantmaking

Grants may be made to organisations which The Portland Trust is working with on any project furthering the Charity's charitable aims. Such expenditure is listed in the notes to the Financial Statements.

Volunteers

With the exception of the Trustees, The Portland Trust had no volunteers in 2020.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report Achievement and performance Charitable activities

As an 'action tank,' The Portland Trust's direct charitable expenditure mainly comprises its staff costs. Other costs are accounted for on a project basis, as detailed in Note 4 to the Financial Statements.

A. Palestine Programme

Over the years, The Portland Trust has worked to help develop the Palestinian private sector by investigating and catalysing investment and job creation opportunities, aiming to promote sustainable growth in the Palestinian economy. The Portland Trust has partnered with local and international actors to drive development across various economic sectors including housing and construction, energy, water, agriculture, tourism, and technology.

The Portland Trust continues to strengthen the foundations for sustainable growth, employment and stability.

1. Palestinian IT Sector

As recommended in the Beyond Aid report (The Portland Trust, 2013), The Portland Trust maintained its commitment to generating employment in the Palestinian technology sector, and this formed the principal focus of its programme in 2020.

Currently, there are over 600 tech companies in Palestine, employing over 8,500 workers. Most of these companies are micro businesses, with a small number of SMEs working in R&D software outsourcing for multinational corporations or providing business process outsourcing for services such as call centre support and data entry. In addition, there is a slowly emerging digital entrepreneurship scene with growing investment and several early-stage start-ups.

Despite its potential, the tech sector remains small, constituting less than 0.4% of Palestinian GDP. Key impediments include:

Lack of exposure to international technological and talent development: According to employers, missing skills include both technical and business (soft skill) competencies.

Legal framework and bureaucratic procedures: The World Bank's 2020 Doing Business Report ranked Palestine 117th on the ease of doing business index out of a total of 190 countries.

The education system: Formal education offers minimal interaction with technology and the private sector and does not incentivise problem-solving and innovation. With human capital regarded as the most important input for tech sector development, modernising the education system is vital to the creation of a suitable and sustainable enabling environment.

Notwithstanding, Palestine has a sizable talent pool with relatively high levels of academic attainment. Currently, all thirteen universities in the West Bank and Gaza have IT departments, with 2,500 students graduating annually. However, the unemployment rate among Computer Science graduates remains high, standing at 45% in Gaza and 18% in the West Bank, with only 10% of tech graduates typically securing employment within the sector each year.

As such, in 2020 The Portland Trust focused its efforts on catalysing accelerated growth in the Palestinian tech sector by developing scalable solutions for matching international and Israel-based employers with well-vetted and locally trained talent.

Catalysing IT Outsourcing Growth Through Addressing Geographical Disparities

In early 2020, The Portland Trust identified an opportunity to boost employment in IT outsourcing by focusing on the cities of Nablus and Hebron in the north and south of the West Bank respectively. These two municipalities account for the majority of Palestinian tech graduates but provide little scope for employment as the bulk of top job opportunities are concentrated in the central towns of Ramallah and Rawabi.

Despite the operational difficulties introduced by the global pandemic and resultant economic crisis in 2020, the outsourcing model has a high potential to address business needs given the global trend for adopting remote working combined with more competitive rates for international outsourcing clients in the chosen cities.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

In essence, The Portland Trust initiative set out to strengthen the capacity of local providers to deliver graduate tech training to international standards, on a commercially sustainable basis. In parallel, it aimed to increase market exposure and business development for local IT companies to help secure outsourcing contracts, generating increased employment opportunities for programme participants, directly improving their lives and livelihood whilst boosting the growth of the sector more broadly.

In 2020, The Portland Trust focused on three core workstreams in preparation for the formal launch of the programme, namely talent development, business development and sustainable financial structuring.

Talent Development: The Portland Trust conducted in-depth research and analysis of international tech training programmes and developed a curriculum in line with international best practice adapted to local circumstances. In particular, it addresses the skills gap between Palestinian university graduates and commercial market requirements and most significantly builds the capacity of local service providers to deliver the training.

In October 2020, The Portland Trust selected two Nablus based IT companies as the training partners; Kiitos, a Palestinian-Dutch company with offices in Nablus and Amsterdam as the lead service provider, supported by Radix Technologies. The Portland Trust worked with Kiitos and Radix to design a selection process to recruit STEM (Science, Technology, Engineering and Maths) graduates with high technical competencies to upskill them and prepare them for employment. Training was designed to be project-based, with trainees working on live, client-based projects alongside senior developers and team leads.

The Portland Trust continued to validate the programme with potential demand-side clients and other regional and international training providers throughout the year. Having considered various models, it was ultimately agreed that each cohort of trainees should undertake a three-month intensive training course, comprising two technical tracks focusing on the development of skills most in demand internationally but lacking in the Palestinian tech sector. In addition, the curriculum would incorporate career coaching and training in relevant soft skills deemed essential for employability, such as English language.

In order to mitigate personal financial constraints, the programme was designed to include the provision of stipends of between $300-$600 to trainees to enable them to complete the programme.

Business Development: In parallel with its work to develop the training programme, during 2020 The Portland Trust offered advice and guidance to IT outsourcing companies in Nablus and Hebron to help develop their operational capacity and to assist them in preparing to compete for international contracts.

To that end, The Portland Trust took the lead in the creation of a competitive pricing model based on its analysis of international cost comparisons, facilitated resource sharing agreements between IT outsourcing companies to help achieve scale, and secured a soft commitment for interviews from a Swiss FinTech company willing to consider hiring trainees upon completion of the programme.

Also during 2020, The Portland Trust began to review sales presentations and client pitch decks for early stage IT outsourcing companies in Nablus, to ensure the quality and professionalism of marketing material required to attract a pipeline of work from Israel and the rest of the world.

Sustainable Financial Structuring: Through its strategic commitment to partner with local Palestinian training providers, The Portland Trust was able in 2020 to design a programme that conforms to international best practices, whilst simultaneously achieving cost savings appropriate for local market conditions. The pilot training programme will cost $2,500 per person, significantly less than other international bootcamps/training programmes currently offered in Palestine, Israel and the region which range from $8,000-$12,000 per person.

In addition, whilst other training initiatives rely entirely on donor grants for funding, The Portland Trust engaged with the private sector, policy makers, the World Bank and a range of international donors during 2020 to design a commercially self-sustaining financing model. As such, the cost of training would be treated as an impact investment rather than a grant, to be repaid with interest to the investor(s) upon the successful placement in employment of the graduates of the programme.

This innovative financial model, developed by The Portland Trust, saw the creation of the first ever Income Sharing Agreement (ISA) in Palestine. The ISA contracts the trainees to repay a portion of the cost of training once they are employed, with the remainder to be covered by the IT outsourcing companies from their operating margin.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

2. Social Impact Investment

In addition to designing and introducing the first Income Sharing Agreement (ISA) as part of its commitment to ensuring impact-based investment for the development of the tech sector as highlighted above, The Portland Trust continued to play a leading market-building role for the promotion of social impact investing in Palestine. This innovative financial mechanism can help leverage previously untapped capital, foster innovation, and enable donors to shift their approach to development by focusing on measurable outcomes.

Type 2 Diabetes among Palestinian Refugee Women

In January 2019, The Portland Trust launched the first Social Impact Bond (SIB) in Palestine and the Arab world, to address the growing Type 2 Diabetes epidemic in Palestine. The SIB aims to provide a structured intervention for 150 pre-diabetic women in West Bank refugee camps over a three-year period, leading to sustained weight loss and preventing the onset of diabetes, resulting in significant positive public health outcomes and substantial financial savings for the national healthcare budget. The intervention is being delivered by Juzoor, a local public health organisation with a strong track record of working with women in impoverished areas. To support service delivery, The Portland Trust secured the commitment of the Paltel Group, the largest telecom provider in Palestine, for an outcome payment for the first cohort totalling $150,000-$250,000. The Portland Trust also succeeded in raising $150,000 in investment for the SIB from the Bank of Palestine, the largest national bank.

In 2020, The Portland Trust continued to monitor the project. Due to the periodic COVID-19 lockdowns, however, the delivery of the initiative was affected with women unable physically to exercise in line with diet intervention plans. As a result, many women regained weight they had lost. The need for this intervention is now more evident than ever, with women having limited agency during the lockdown period to prioritise their own health.

In October 2020, 77 women from the various cohorts provided their weight measurements, of whom 36 women maintained their 5-7% weight loss goal (47% of participants). The repeated, full or partial lockdowns prevented regular face to face monitoring during the year, making it very difficult for Juzoor to provide the optimal assistance and motivation for the women. Furthermore, a financial crisis within the United Nations Relief and Works Agency (UNRWA) impacted the work of its clinics where much of Juzoor's intervention takes place. Juzoor sought to mitigate some of these constraints through supplying weighing scales and continuing to provide nutritional tips and physical activity motivational videos remotely.

World Bank Development Impact Bond to Address Youth Unemployment

The Portland Trust supported the World Bank to develop its first ever Development Impact Bond (DIB) addressing high youth unemployment in Palestine, launched in November 2019. The Bank partnered with the Ministry of Finance and Planning (MoF), Social Finance UK, and DAI to provide 1,500 young Palestinians aged 18-29 years with skills training and training-to-employment support, over a period of three years.

An initial investment of $1.8 million was secured from four local and international investors who will provide financing to delivery organisations for interventions that support participants' transition to employment. If the project achieves the agreed employment results, independently verified, then the MoF will repay investors, drawing on a $5 million outcomes fund earmarked by the World Bank from its West Bank and Gaza Trust Fund. The DIB approach is expected to incentivise increased flexibility and adaptation both in training methods and in responding to evolving employer needs.

The DIB's first cycle targeted employment creation in both nursing, supporting hospitals seeking to improve care quality standards, and health and safety inspectors in the construction and industrial sectors. In 2020, more than 300 youth received training and are now in the internship phase, preparing them for employment.

B. Israel Programme

The Portland Trust is focused on enhancing economic opportunities in the Israeli social and geographic periphery, addressing Israeli Arab employment and business challenges and strengthening Arab municipal development. The Portland Trust's aim is to create a systemic change to integrate the Arab sector into the Israeli economy, generating employment opportunities and enhancing the lives and livelihood of Israeli Arabs whilst increasing their contribution to GDP. During 2019, The Portland Trust also began to develop interventions aimed at increasing economic participation and improved living standards amongst the ultra-Orthodox (Haredi) Jewish community.

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THE PORTLAND TRUST

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Strategic report

1. Developing a Regional Economic Growth Strategy for the Arab sector in Israel

Building on Israeli Government Resolution 922, a five-year plan which aimed to address the socio-economic gaps between Arabs and Jews in Israel, The Portland Trust embarked on the development of a private sector led framework for regional economic growth for the Arab sector.

In 2019, The Portland Trust conducted a thorough analysis of regional strengths and weaknesses, including in relation to Arab-Jewish integration. Based on this study, a pilot region was selected in southeast Akko/Sakhnin, including the communities of Sakhnin, Misgav, Arraba, Dir Hana, Kfar Manda, Kaukab and Sha'ab. The Portland Trust identified health services and digital health/MedTech as the growth engine. Recommendations included the building of a tech compound specialising in medicine and healthcare, building centres for health services with an emphasis on typical ailments, and establishing elderly care facilities. The Portland Trust formulated a detailed implementation plan, and a small delivery team was appointed alongside the establishment of a strategic partners coalition to bolster government involvement in order to advance the implementation of the plan.

Throughout 2020, The Portland Trust continued to make good progress with the plan's implementation, strengthening its collaboration with key partners and identifying projects for development in Sakhnin valley. These include an accelerator programme to support local clinicians operating in adjacent hospitals, assisting them to develop their innovative ideas into clinical proofs of concept. The goal is to create the seeds for future companies which will operate in the area. The Portland Trust developed plans to further expand the programme to include an innovation lab in collaboration with the Israeli Innovation Authority. Additional projects which The Portland Trust identified in 2020 include a pharmaceutical compounding facility to provide services to the local hospitals and community, a pharmaceutical consulting and logistics centre and a genomics lab. The Portland Trust also identified significant potential in establishing an orthodontal ecosystem in the region, based on a collaboration between the Galilee hospital, the Bar Ilan Medical Faculty in Zafed and the dental private sector.

The Portland Trust presented the plan at a meeting with the Minister of Economy and his Director General. The Minister expressed support for the programme and instructed the Director General to adopt it as a flagship project in collaboration with the Authority for Economic Development of Minorities, and to establish a cross-governmental committee to promote the initiative. The Portland Trust continued to deepen its partnership with the local municipalities and established a local steering committee which includes the municipalities' representatives, as a means to receive their feedback, support and engagement with these endeavours.

Finally, during 2020 The Portland Trust worked to expand the programme to include an additional economic cluster in the Eshkol Hasharon region, in cooperation with the local municipalities there. KPMG Israel was selected to advise on the project and the process of identifying the economic growth engines for this region began in October.

2. Urban Planning and Affordable Housing for Arab Youth

During 2019, The Portland Trust advocated for a national plan to develop new urban neighbourhoods in existing Arab cities and large villages. The objectives of this initiative were: to create affordable housing for the younger generation; overcome registration issues; enable modern urban planning; put in place new financial models to enable the development and marketing of neighbourhoods on private/national land; provide youth with homeowner financing in the form of loans and mortgages; and provide access to improved education, health services, employment, and academic centres.

Two privately owned sites in Taybeh and Baqa al-Gharbiyye were identified as potential locations for the projects. An area of 50 dunams was earmarked to include a modern compound of residential units, commercial and public spaces. A visit took place in 2019 with Investment Company IBI, Social Venture Fund and others. The model was completed in 2019, and zoning permission processes began as a consequence.

At the start of 2020, The Portland Trust pursued its negotiation with the landowner with the aim of reaching an agreement by the middle of the year, enabling the preparation of an approved plan with work commencing on the ground in 2021. However, due to the COVID-19 pandemic, the timetable was delayed. The landowner who had been interested in the plan decided not to proceed for the time being. As explained below, The Portland Trust will continue to explore options and will resume planning once an appropriate alternative site has been identified.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

3. Lotus Project for Orthodox Druze Women

A population of about 400 young orthodox Druze women, who have successfully graduated from high school in science tracks, live in the Israeli periphery. In 2019, The Portland Trust partnered with Lotus, a local NGO run by Druze women based in Isfiya, which aims to create the first generation of orthodox Druze women to break the glass ceiling and achieve quality employment in hi-tech firms. This will be accomplished only if their traditions are maintained, working in a womenonly "safe space" inside the village.

With the support of The Portland Trust, Lotus initiated an eight-month programme, during which women with a high potential to succeed in hi-tech positions were identified and trained to become Full-Stack developers. In addition to training, in 2019 Lotus was lent two rooms in a private house to establish the first hi-tech co-working space in a Druze village designated for women. The women were able to work full time for leading hi-tech firms from the improvised Lotus "tech hub".

The first cohort consisted of fourteen participants, aged 18-32, all of whom graduated from Lotus in August 2019 and were employed by industry leaders Amdocs, Mellanox and Oranbit, following extensive interviewing and testing processes. The graduates earn a starting monthly salary of 11,000 NIS, representing a four-fold increase on their previous salaries.

During 2020, The Portland Trust built on its partnership with Lotus, facilitating and mentoring the NGO's activity, developing the next cohorts of the programme and matchmaking for employment in the hi-tech sector. A second cohort of women were recruited and started training in October 2019 leading to fifteen graduates securing employment during 2020. The success of such placements amplifies the strength and sustainability of the Lotus model. A third cohort of seventeen women was selected and commenced training in late 2020.

The establishment of a new, dedicated 500m² Lotus Hub was completed in mid-2020, enabling Lotus to relocate to the first, purpose-built, women only tech hub in the Arab sector. The hub is fully furnished and equipped, funded entirely by donations from hi-tech firms and private donors.

4. Fursa

In 2020, The Portland Trust launched a new initiative, Fursa, which aims to provide a scalable solution of quality employment for talented young Arab Israelis, who have graduated from scientific academic degrees, but failed to integrate into the hi-tech sector, or quality employment in general. The programme leverages the Lotus model and knowhow for the design of an intervention that addresses the needs of the hi-tech sector, while taking into consideration the context of Arab society in Israel.

The historic lack of integration was exacerbated during 2020, with new graduates in general struggling to find their first job. This situation poses a double challenge for Arab youth who experience traditional barriers to integration in addition to the current lack of junior employment positions and an unwillingness of employers to hire juniors in Israel, preferring instead to recruit staff in low-cost, offshore centres such as India and Ukraine. Fursa works to identify talented youth and the enabling factors needed for their inclusion in hi-tech, within an appealing employment cost model for the employers.

The Portland Trust established and registered Fursa as an NGO, and in November 2020 finalised the selection process of a first cohort of thirteen participants from a group of 150 candidates, all of whom are Computer Science graduates from leading universities, including the Technion, Tel Aviv University and the Hebrew University. The first group will be certified as DevOps experts ready for employment in hi-tech firms.

5. A Path to Empowerment and Equality: A Master Plan for Employment of Arab Israeli Women

During 2019, The Portland Trust, in partnership with the Israel Democracy Institute (IDI), conducted in-depth research to determine how to bridge the economic gap between Israel's Arab and Jewish communities, focusing on women's employment. The Israeli government has acknowledged the importance of meeting the challenge of Arab women's employment and has allocated major funds to this issue through Government Resolution 922. The project aims to lay the groundwork for effective government policy by presenting recommendations to serve as a comprehensive master plan for a new government resolution and five-year plan. The proposal will include a set of concrete objectives and tools that the government will be asked to adopt.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

Building on the foundations laid in 2019 through its comprehensive research, stakeholder engagement, sectoral mapping and the presentation of preliminary briefings to the Ministry of Finance, The Portland Trust continued throughout 2020 to lead the development of the strategic master plan.

During 2020, The Portland Trust held more than thirty meetings with officers from seven different ministries: Ministry of Economy, Ministry of Labour, Ministry of Welfare, Ministry of Finance, MALAG (Council for Higher Education), and the Ministry of Agriculture (Bedouin population/community involvement). In January, The Portland Trust co-chaired a steering committee with representatives from each ministry, where each presented recommendations prepared by The Portland Trust. In February, the programme was presented to the Local Arab Municipalities Committee, to receive feedback and evolve the programme accordingly. Many of the chapters of the report were completed, with the approval of the steering committee, and preliminary documentation with background for each policy was submitted for publishing. The final work will enable policy makers to better understand Arab minorities when formulating policy.

In light of the COVID-19 crisis and political uncertainty following a series of inconclusive General Elections, most government professionals were unable to prioritise non-urgent matters. However, in informal conversations they expressed their continued commitment to the programme and to supporting its presentation to the Budget Division of the Finance Ministry, understanding that the Arab Israeli community will be amongst the populations most severely affected by the crisis. Moreover, they recognise the potential for the Arab Israeli community to contribute significantly to long-term economic growth, making this a sound investment.

Despite the challenges, the project continued to make good progress with all government agencies. The Portland Trust continued to present the master plan to key stakeholders in civil society, philanthropic and government circles, and actively to advocate for the full adoption of the programme by the Government.

6. Nation-wide Academic Plan for the Education of Haredi Youth in Computer Science and their Placement in Leading Jobs in the Hi-tech Sector

Following the development of its vision and preliminary planning and scoping work during 2019, The Portland Trust in 2020 launched an initiative to enable Haredi men to study for a full BSc degree in Computer Science at the Hebrew University with guaranteed employment in leading hi-tech jobs with high salaries. For the first time, a designated track for Ultra-Orthodox men is being conducted in one of the world's top-rated universities. The programme provides academic, social, and financial support to its participants, helping them to focus on successfully completing their BSc and integrating into leading global hi-tech firms upon graduation.

Given that the focus of the programme is on future employment in leading hi-tech firms, the hi-tech sector has been involved in the initiative from the outset, to ensure the industry's ability to influence the course content and later to recruit the students. The programme provides scholarships and social loans to students who have made a significant commitment to completing the preparatory track and psychometric tests to be accepted by the Hebrew University. The total contribution to the economy by the end of the tenth year will be approximately 825.5 million NIS with a recurring annual impact each year thereafter of 221 million NIS.

The first cohort of nineteen students began the programme in October 2020. A Programme Director was appointed, jointly funded by The Portland Trust and the Hebrew University. Despite the considerable challenges, the support envelope designed by The Portland Trust proved significant in the success of the launch and early phase of the project.

7. Portland Campus

The Portland Campus is a management accelerator which equips talented social entrepreneurs with tools to improve their work and enhance the outcomes of the various social impact initiatives focused on economic development and quality employment opportunities, which The Portland Trust supports.

The first cohort of thirteen NGO leaders commenced in mid-October 2019 and concluded in February 2020. The participants were drawn from diverse backgrounds, including Bedouin, Druze, Muslim, Jewish Ultra-Orthodox and secular people from across Israel, all dealing with support for quality employment for disadvantaged communities. The programme provided the participants with the most up-to-date management methodologies, best practices, and an opportunity to engage in peer learning, sharing from their experience and creating a mutually supportive community. The participants' feedback on the content provided by The Portland Trust was excellent and proved both the necessity of this initiative, and the quality of the implementation.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report Social Finance Israel

During 2020, The Portland Trust continued to support and partner with Social Finance Israel (SFI), having played a leading role in its establishment in 2013 as a public benefit company and Israel's first social-financial intermediary.

SFI is the leading developer of Social Impact Bonds (SIBs) in Israel and is attracting new capital towards non-profit organisations and social enterprises tackling a range of high-priority social challenges. These include reducing the dropout rate amongst higher education technology students, preventing the onset of Type 2 diabetes amongst pre-diabetics and enhancing educational attainment in maths for Bedouin high school students in the Negev.

In 2020 SFI launched its fifth SIB which focuses on reducing loneliness and isolation amongst the elderly.

The Negev and Galilee Loan Guarantee Project

The Koret Israel Economic Development Fund (KIEDF) made the fourth instalment of its 5-year repayment to The Portland Trust in December 2020.

C. Publications, Research and Events

Palestinian Economic Bulletin

The Portland Trust continues to publish the monthly Palestinian Economic Bulletin, which reports on key economic developments in Palestine. The Bulletin is distributed to over 1,200 international and local subscribers and is broadly recognised as the only English-language monthly publication focusing on the Palestinian economy. In 2019, TPT started publishing an Arabic-language version of the bulletin, with a view to expand readership regionally. Currently, over 20% of the Bulletin's readers access it in Arabic.

In 2020, in addition to its regular reporting, the Bulletin provided in-depth economic analysis of the impact of COVID-19 on the Palestinian economy and the potential economic implications of Israeli annexation.

Financial review

Financial position

As detailed in the Review of Activities and the Notes to the Financial Statements, The Portland Trust has driven and contributed to a number of initiatives. Sufficient income has again been secured to meet all of our commitments. At 31 December 2020 The Portland Trust had a liquid balance sheet with a cash position of £1,381,199 which helps to secure the Charity's plans to promote economic stability in the Middle East into 2021 and beyond.

Principal funding sources

The Portland Trust mainly receives funding from grant-making charities based in the United Kingdom and internationally. In addition, in 2019 and 2020 The Portland Trust received significant income from investments as detailed in the Notes to the Financial Statements.

Investment policy and objectives

The Trustees have regard to the liquidity requirements of the Charity and maintain a policy of keeping any surplus liquid funds on short-term deposit which can be accessed readily to enable the timely response to project needs.

Reserves policy

The Portland Trust carries out a blend of both long- and short-term projects. The Trustees have examined the requirement for free reserves which are those unrestricted funds not designated for specific purposes or otherwise committed. The Trustees consider that generally, free reserves should be sufficient to cover approximately three months of regular operational expenditure which equates to approximately £350,000.

At 31 December 2020 unrestricted retained reserves totalled £1,181,157 and restricted retained reserves were £185,211.

The free reserves at the year-end are considered adequate for this purpose and to carry out appropriate projects going forward.

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THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report Future developments A. Palestine Programme

Palestinian IT Outsourcing

Building on its extensive planning and preparation in 2020 as outlined above, The Portland Trust formally launched its new Talent Acceleration Programme (TAP) in February 2021. The intervention aims to create 200-300 jobs in Palestinian Small and Medium Enterprises (SMEs) in IT outsourcing (ITO) firms based in underserved regions of the West Bank over the next two to three years. The initiative is expected to catalyse the growth of the sector, leading to the employment of thousands of developers over the coming decade and making a significant contribution to GDP.

During 2021, The Portland Trust will focus on the successful delivery of the TAP project in partnership with Kiitos Technologies, a Palestinian-Dutch company. Kiitos and the launch of TAP have been celebrated in the Netherlands and were highlighted in the newsletter of the Dutch Good Growth Fund (DGGF) under the auspices of the Dutch Ministry of Foreign Affairs. TAP is supervised by an experienced team of local and international mentors.

The first TAP cohort comprises sixteen trainees (eight from Nablus, two from Hebron, and six from Gaza) over half of whom are women. The twelve-week intensive programme aims to accelerate their transition from fresh graduates to wellrounded tech professionals, ready for hire by 15th May 2021.

Trainees specialise in advanced front/back-end software development through a self-directed curriculum embedded within two live client projects for experiential learning. Trainees learn business acumen, soft skills, professional English language skills, and receive 1:1 career coaching.

Trainees are evaluated on job readiness at the end of each month, based on the previous month's overall engagement, client project work, presentations, and mock job interviews. Initial evaluations from Month 1 have shown impressive results where trainees are developing soft and technical skills at an accelerated pace. Based on Month 1 evaluations, one participant from Hebron dropped out of the ITO pilot but has committed to reapplying for the second cohort in June.

During 2021 and beyond, The Portland Trust will continue to work closely with partners and other stakeholders to scale up the training programme. The screening for the second cohort commenced on 12th April with an expected launch date of 15th June. A third cohort is planned for October 2021.

Very Large Systems Integration (VLSI) Labs & Design Verification

As reported previously, The Portland Trust has catalysed and facilitated the establishment of three VLSI labs at Palestinian universities, first at Al-Najjah University in Nablus, followed by the Arab American University in Jenin and Al Quds University in Abu Dis.

The Portland Trust remains committed to the successful deployment of these labs and in January 2021, in partnership with Mercy Corps, organised a Training of Trainers (ToT) programme led by Palestinian industry experts for the university faculty to improve their familiarity with leading-industry tools. Fifteen university professors participated in the month-long programme, comprising twelve, three-hour sessions. The training will enable the professors to utilise the labs efficiently and assist them in upgrading the computer engineering curriculum for the spring semester of 2021 to better devise market-driven courses.

The Portland Trust will continue to liaise closely with the universities to assist their use of the labs, and will explore the potential for the roll-out of further such labs at additional universities.

Exploring Tech Sector Development Opportunities

In line with its long-term, commitment to expanding capacity within the Palestinian tech sector, in early 2021 The Portland Trust began to explore with strategic partners the feasibility of establishing a Centre of Excellence to enable and support the technology start-up ecosystem in Palestine.

The aim of such a Centre would be to accelerate the introduction and adoption of emerging and transformational technologies in Palestine, such as data science, artificial intelligence and machine learning, and blockchain through multiple interventions. One such initiative currently under investigation is the development of training and certification in the form of a partnership between one of the most prestigious universities in the United States and a major Palestinian university.

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Report of the Trustees for the year ended 31 December 2020

Strategic report

During 2021, The Portland Trust will continue to support and facilitate the planning process and will take practical steps as required to enable implementation on the ground.

Type 2 Diabetes Development Impact Bond (DIB)

During 2021, The Portland Trust will continue to work with Juzoor to monitor the delivery of the Type 2 Diabetes DIB aimed at preventing the onset of the disease amongst pre-diabetic women in Palestinian refugee camps.

As reported above, the delivery of the intervention in 2020 was constrained by the COVID-19 pandemic, and it is hoped that the easing of restrictions in 2021 will enable the programme to return to its 2019 level of activity. The Portland Trust will regularly assess progress.

Gaza

The Portland Trust continues to promote the Gaza Vision outlined in its 2016 publication, Global Palestine, Connected Gaza and to support the efforts of the private sector coordinating committee to drive forward implementation. It also continues to focus on opportunities to develop project ideas in line with the Vision.

In particular, during 2021 The Portland Trust will work to develop initiatives that address the urgent need for access to electricity amongst the citizens of the Gaza Strip through innovative clean energy schemes.

B. Israel Programme

Developing a Regional Economic Growth Strategy for the Arab sector in Israel

During 2021, The Portland Trust continues to drive the implementation of its regional growth engines initiative outlined above.

To that end, operational meetings with the Director General and the Head of the Innovation Authority commenced in the first quarter of 2021. The Portland Trust will continue to work in partnership with the local municipalities and the overarching steering committee to ensure full stakeholder engagement.

The Portland Trust prioritising the following key initiatives:

a. Health related entrepreneurship launchpads: An operating model for each has been defined and the relevant government partner identified. The Portland Trust has facilitated a roadshow with several Israeli health-related venture capital funds to assess their potential. A collaboration agreement has been reached with Rambam hospital to foster an Accelerator and Incubator. The Portland Trust is leading the business modelling and working to identify private funding sources to match government funds.

b. Pharmaceutical compounding facility: A facility is being promoted in the area in collaboration with Rambam Hospital. Outreach is ongoing to private companies which may be interested in establishing the facility in the area.

c. Establishment of a local A&E (emergency care centre) and physicians' clinic/hub.

d. Medical simulation centre: A centre is being planned to serve as a training facility, in cooperation with Sheba hospital.

The Portland Trust is also continuing to work on the expansion of the initiative in the Eshkol Hasharon region which began in 2020 as reported above. The consulting partner, KPMG, has presented initial options regarding identifiable growth engines for the area. The Portland Trust has completed the second of four phases of the consulting process, reviewing the shortlist of three industry cluster options, which are currently being assessed and discussed by the steering committee.

Urban Planning and Affordable Housing for Arab Youth

As outlined above, notwithstanding the delay in the development of this initiative due to the impact of the COVID-19 pandemic, The Portland Trust remains committed to its implementation in collaboration with the landowners, the municipality, and with official planning institutions.

Meetings already held indicate there remains great interest from the government, private sector and local leaders in the project. The Portland Trust will continue to work to identify an appropriate site for the launch of the scheme.

Page 10

THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

A Path to Empowerment and Equality: Master Plan for Employment of Arab-Israeli Women

During 2021, The Portland Trust continues to work towards the full adoption by the Government of its strategic master plan, as outlined above.

An additional project currently being validated in this context, is to promote the participation of the Arab sector and other minorities in Government Procurement tenders. Two aspects being explored are the inclusion of Arab and other minorityowned businesses as participants in tenders and to include employment of minorities as a criterion for companies submitting tenders. Both elements require legislation. The goal of The Portland Trust and the focus of its efforts for 2021 is to prepare the ground to make such a legislative move feasible.

Lotus Project for Orthodox Druze Women

During 2021, The Portland Trust continues to support the expansion of the Lotus project, building on the successful integration of thirty-three Druze women to date into hi-tech positions with our partner firms as software developers and data analysts.

The third cohort of seventeen participants are expected to graduate in the summer and start work by September 2021. The Portland Trust and Lotus remain on track to have sixty women employed by the end of 2021, and are developing plans to open a second Lotus branch in the Galilee in 2022.

Fursa

As outlined above, the first cohort of thirteen participants, all university Computer Science graduates, commenced the Fursa training in November 2020. All thirteen completed the course and were certified as DevOps experts in January 2021 and all have successfully integrated into leading hi-tech companies.

The second cohort of DevOps engineers started training in April and are expected to be placed in employment by the end of July. The goal of The Portland Trust is to have over fifty Fursa graduates placed in hi-tech companies by the end of 2021.

Creating an Ultra-Orthodox Elite: Complete Degree at Hebrew University and Employment in Global Hi-Tech Firms

As reported above, the first cohort of nineteen Haredi students began the BSc degree programme at the Hebrew University in October 2020.

Despite the difficulties of starting the academic year with remote learning as a result of the restrictions due to the COVID19 pandemic, at the end of the first semester seventeen students remain in the programme and their achievements so far match those of the general student population which is highly encouraging. The programme's support package has proven crucial in enabling these achievements.

During 2021, The Portland Trust continues to work closely with the Hebrew University to ensure the success of the programme and to prepare for the second intake of students for the 2021-2022 academic year.

The Negev and Galilee Loan Guarantee Project

KIEDF is expected to make the fifth instalment of its 5-year repayment to The Portland Trust in December 2021.

Social Finance Israel (SFI)

The Portland Trust continues to support the work of SFI during 2021.

Page 11

THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Strategic report

C. Publications, Research and Events

Palestinian Economic Bulletin

To date in 2021, the Bulletin has reviewed the Palestinian Central Bureau of Statistics (PCBS) forecasts for economic growth prospects in 2021; covered the second annual International Conference for Entrepreneurship - Palestine (ICEP); reported on the agreement reached to raise the minimum monthly wage; provided an economic analysis of the trade deficit reduction to pre-2014 levels; reviewed the iPoke report on e-commerce and social media activity in Palestine during 2020; highlighted the establishment of "Al-Estiqlal Bank for Development and Investment"; and discussed an agreement for the development of the Gaza Marine gas field.

Structure, governance and management

Governing document

The charity is controlled by its governing document, a deed of trust, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006.

The liability in respect of the guarantee is limited to £1 per member.

Recruitment and appointment of new trustees

The Trustees of the Charity have control of the Charity and its property and funds. The first Trustees were Sir Ronald Cohen and Sir Harry Solomon. Unless otherwise determined by ordinary resolution, the number of Trustees is subject to a maximum of ten and minimum of two. Trustees may be individuals or bodies corporate.

Every Trustee signs a declaration of willingness to act as a Charity Trustee before being eligible to vote at any meeting of the Trustees. One third (or the number nearest to one third) of the Trustees retire at each Annual General Meeting, those in office retiring first and the choice between any of equal service being made by drawing lots unless they otherwise agree among themselves.

The members are entitled to appoint one or more Trustees (including themselves), to remove any Trustee so appointed and to appoint another Trustee in place of any Trustee so appointed who for any reason ceases to be a Trustee. A retiring Trustee is not eligible for reappointment unless such reappointment is approved by the Trustees.

Organisational structure

The Trustees provide their services free of charge. The Portland Trust has offices in London, Tel Aviv and Ramallah. Douglas Krikler runs the organisation from the London office where there are four employees. The Tel Aviv office, which opened in 2005, has five members of staff and is run by Rami Schwartz. The Ramallah office was opened in April 2006, has six members of staff, and is run by Yahya Shunnar under the chairmanship of Samir Hulileh.

Decision making

Whilst the Trustees are responsible for overseeing the activities and direction of the Charity, the Executive Committee approves expenditure on the projects undertaken by The Portland Trust. This committee comprises Trustee representatives and senior executives from each operating branch.

Induction and training of new trustees

All of the Trustees are experienced in charity matters and therefore no formal training takes place. When new issues and developments come to light the Trustees are made aware of these matters at their next meeting. Any new Trustee would be expected to have the same level of experience and knowledge as the existing Trustees.

Key management remuneration

The members of the Executive Committee comprise the key management personnel of The Portland Trust and are responsible for the direction, control and running of the Charity on a day to day basis.

All the Trustees provide their services free of charge. The pay of senior staff is reviewed annually, and rates are set at market rate for their role.

Related parties

None of the Trustees receive remuneration or other benefits from their work with The Portland Trust, although their expenses incurred in the performance of their duties as a Trustee may be paid by the Charity.

Trustees may hold a position of responsibility within organisations which receive funding from The Portland Trust. In such cases this is disclosed in the notes to the Financial Statements.

Page 12

THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Structure, governance and management Risk management

The Trustees regularly review the risks to which the charity is exposed and to ensure appropriate controls are in place to provide reasonable assurance against fraud and error. No significant risks were identified during the year.

COVID-19

There was no major adverse impact on fundraising in 2020 as a result of COVID-19, and project implementation was only marginally affected.

The Trustees recognise the risk to fundraising and income as a result of COVID-19 and manage this risk by monitoring the activities and finances of the organisation through regular, detailed monthly management accounts including cash flow and project funding.

The Trustees have reviewed the reserves policy and do not feel that any amendments are required in light of COVID-19.

The Trustees recognise that there is a risk to the delivery of the Charity's projects as a result of COVID-19. They manage this risk through the preparation and discussion of a detailed quarterly programme update which highlights progress and any matters of concern in each project area. No action has been necessitated by COVID-19 during this time with regard to project implementation.

The Trustees recognise that there is a risk to the ability of the staff of the organisation to carry out their work effectively as a result of COVID-19. In light of the imposition of lockdowns in the UK, Israel and Palestine, the organisation has adapted to a flexible way of working across its three offices. All staff have the ability to work remotely and have done so effectively. The organisation has not furloughed any staff nor made any staff redundant across the three offices as a result of COVID-19.

The Trustees recognise the potential ongoing impact of COVID-19 and will continue to monitor associated financial and operational risks through the above measures in place.

Reference and administrative details Registered Company number

04699155 (England and Wales)

Registered Charity number

1106429

Registered office

25 Farringdon Street London EC4A 4AB

Trustees

Ms N J Cobbold Sir R M Cohen Sir M L Davis Sir H Solomon

Company Secretary

Mr S D Clarke

Auditors

RSM UK Audit LLP 25 Farringdon Street London EC4A 4AB

Statement of trustees' responsibilities

The trustees (who are also the directors of The Portland Trust for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Page 13

THE PORTLAND TRUST

Report of the Trustees for the year ended 31 December 2020

Statement of trustees' responsibilities - continued

Company law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing those financial statements, the trustees are required to

• select suitable accounting policies and then apply them consistently;

• observe the methods and principles in the Charity SORP;

• make judgements and estimates that are reasonable and prudent;

• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.

The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the trustees are aware:

• there is no relevant audit information of which the charitable company's auditors are unaware; and

• the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information.

Auditors

The auditors, RSM UK Audit LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

Report of the trustees, incorporating a strategic report, approved by order of the board of trustees, as the company directors, on ....1..4..t.h...J..u..ly...2..0..2..1 ...................... and signed on the board's behalf by:

....[S] ..[i] .[r] ...[R] ..[o] ...[n] ..[a] ..[l] ..[d] ...[C] .....[o][h] ..[e] ...[n] .................................. Sir R M Cohen - Trustee

Sir Harry Solomon

.................................................................... Sir H Solomon - Trustee

Page 14

Report of the Independent Auditors to the Members of The Portland Trust

Opinion

We have audited the financial statements of The Portland Trust (the 'charitable company') for the year ended 31 December 2020 which comprise the Statement of Financial Activities, the Balance Sheet, the 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 (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 31 December 2020 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended;

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

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

Basis for opinion

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

Conclusions relating to going concern

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

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

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

Other information

The other information comprises the information included in the Trustees' Report other than the financial statements and our auditor's report thereon. The trustees are responsible for the other information contained within the Trustees' Report. 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 course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

• the information given in the 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 Directors' Report and the Strategic Report included within the Trustees' Report have been prepared in accordance with applicable legal requirements.

Page 15

Report of the Independent Auditors to the Members of The Portland Trust

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors' Report or the Strategic Report included within the Trustees' Report.

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

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

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

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

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

Responsibilities of trustees

As explained more fully in the Statement of Trustees' responsibilities set out on page 14, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Our responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Independent Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

Page 16

Report of the Independent Auditors to the Members of

The Portland Trust

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

• obtained an understanding of the nature of the sector, including the legal and regulatory frameworks that the charitable company operates in and how the charitable company is complying with the legal and regulatory frameworks;

• inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;

• discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.

As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, Charities SORP (FRS 102), Companies Act 2006, Charities Act 2011, the charitable company's governing document, and tax legislation. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing the financial statements including the Trustees' Report, and remaining alert to any new or unusual transactions which may not be in accordance with the governing documents.

The audit engagement team identified the risk of management override of controls and as the area where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments, evaluating the business rationale in relation to any significant, unusual transactions and transactions entered into outside the normal course of business, and challenging any judgments and estimates.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors.

Use of our report

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

Malcolm Pirouet (Senior Statutory Auditor) for and on behalf of RSM UK Audit LLP 25 Farringdon Street London EC4A 4AB

Date: ............................................. 2 August 2021

Page 17

THE PORTLAND TRUST

Statement of Financial Activities for the year ended 31 December 2020

Unrestricted funds Income and endowments from Notes £ Donations and legacies 2 1,387,072 Investment income 3 1,044,261 Total 2,431,333 Expenditure on Charitable activities 4 Project expenditure 1,121,099 Support cost 496,549 Total 1,617,648 NET INCOME/(EXPENDITURE) 813,685 Reconciliation of funds Total funds brought forward 367,472 Total funds carried forward 1,181,157	Restricted 2020 Total funds funds £ £ 855,900 2,242,972 - 1,044,261 855,900 3,287,233 856,425 1,977,524 - 496,549 856,425 2,474,073 (525) 813,160 185,736 553,208 185,211 1,366,368	2019 Total funds £ 1,350,330 443,459 1,793,789 1,658,168 610,898 2,269,066 (475,277) 1,028,485 553,208

The notes form part of these financial statements

Page 18

THE PORTLAND TRUST

Balance Sheet 31 December 2020

Fixed assets Notes Tangible assets 10 Investments 11 Current assets Debtors 12 Cash at bank Creditors Amounts falling due within one year 13 Net current assets Total assets less current liabilities NET ASSETS Funds Unrestricted funds 15 Restricted funds Total funds	2020 £ 24,698 5 24,703 180,241 1,381,199 1,561,440 (219,775) 1,341,665 1,366,368 1,366,368 1,181,157 185,211 1,366,368	2019 £ 29,990 5
		29,995 416,341 344,812
		761,153 (237,940) 523,213
		553,208 553,208
		367,472 185,736
		553,208

The financial statements were approved by the Board of Trustees and authorised for issue on .........[1] ..[4] ..[t] .[h] ...[J] ..[u] ..[l] .[y] ...[2] ..[0] ..[2] ..[1][ ............... ] and were signed on its behalf by:

Sir Ronald Cohen ............................................. Sir R M Cohen - Trustee

..[S] ..[i] .[r] ...[H] ...[a] ..[r] .[r] ..[y] ...[S] ..[o] ...[l] .[o] ..[m] ....[o] ..[n] ............ Sir H Solomon - Trustee

The notes form part of these financial statements

Page 19

THE PORTLAND TRUST

Cash Flow Statement for the year ended 31 December 2020

Notes Cash flows from operating activities Cash generated from operations 1 Net cash provided by/(used in) operating activities Cash flows from investing activities Purchase of tangible fixed assets Net cash used in investing activities Change in cash and cash equivalents in the reporting period Cash and cash equivalents at the beginning of the reporting period 2 Cash and cash equivalents at the end of the reporting period 2	2020 £ 1,045,921 1,045,921 (9,534) (9,534) 1,036,387 344,812 1,381,199	2019 £ (309,378) (309,378) (2,766) (2,766) (312,144) 656,956 344,812

The notes form part of these financial statements

Page 20

THE PORTLAND TRUST

Notes to the Cash Flow Statement for the year ended 31 December 2020

1.

Reconciliation of net income/(expenditure) to net cash flow from operating activities	Reconciliation of net income/(expenditure) to net cash flow from operating activities
	2020	2019
	£	£
Net income/(expenditure) for the reporting period (as per the
Statement of Financial Activities)	813,160	(475,277)
Adjustments for:
Depreciation charges	14,826	15,965
Decrease in debtors	236,100	277,247
Decrease in creditors	(18,165)	(127,313)
Net cash provided by/(used in) operations	1,045,921	(309,378)

2. Analysis of cash and cash equivalents

Included in purchase of tangible fixed assets is an amount due to exchange differences of £359 (2019: £nil).

Included in depreciation charges is an amount due to exchange differences of £2,237 (2019: £200).

3. Analysis of changes in net funds

Net cash Cash at bank Total	At 1/1/20 £ 344,812 344,812 344,812	Cash flow £ 1,036,387 1,036,387 1,036,387	At 31/12/20 £ 1,381,199 1,381,199 1,381,199

The notes form part of these financial statements

Page 21

THE PORTLAND TRUST

Notes to the Financial Statements for the year ended 31 December 2020

1. Accounting policies

Basis of preparing the financial statements

The financial statements of the charitable company, which is a public benefit entity under FRS 102, have been prepared in accordance with the Charities SORP (FRS 102) 'Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006. The financial statements have been prepared under the historical cost convention, with the exception of investments which are included at market value.

The Financial Statements are prepared in Sterling, which is the functional currency of the charity. Monetary amounts in these financial statements are rounded to the nearest £1.

Going concern

The accounts are prepared on the basis that the Charity has adequate resources to continue to operate. The Trustees have reviewed and considered the relevant information, including the budget and future cash flows in making their assessment. In particular, in response to the COVID-19 pandemic, they have taken into account the impact on the Charity and measures it can take to mitigate the impact. Based on these assessments the Trustees have concluded that they can continue to adopt the going concern basis in preparing the annual report and accounts.

Critical accounting judgements and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historical experiences and reasonable expectations of future events. Revisions to accounting estimates are recognised in the accounting period in which the revision is made.

The Portland Trust has a potential obligation to reinstate its London offices to the original layout. The Trustees do not believe that a significant liability for this exists at the year end.

Income

All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.

Donations and legacies: Voluntary income received by way of grants, donations and gifts is included in the Statement of Financial Activity when receivable and only when the Charity has unconditional entitlement to the income.

Investment Income

Investment income is accounted for in the period that the Charity is entitled to receipt.

Expenditure

Recognition of expenditure

Expenditure is recognised on an accruals basis. Expenditure includes any VAT which cannot be fully recovered, and is reported as part of the expenditure to which it relates.

Expenditure on charitable activities

These comprise the costs incurred by the Charity in the delivery of its activities and charitable activities services in the furtherance of its objects, including the making of grants and governance costs.

Other expenditure These are support costs not allocated to a particular activity.

Tangible fixed assets

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

Improvements to property - 20% straight line on cost Fixtures and fittings - 20% on reducing balance Computer equipment - 20% on reducing balance

Taxation

The charity is exempt from corporation tax on its charitable activities.

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

1. Accounting policies - continued

Fund accounting

Unrestricted funds: These are available for use at the discretion of the trustees in furtherance of the general objects of the charity.

Restricted funds: These are available for use subject to restrictions imposed by the donor or through terms of an appeal.

Foreign currencies

Monetary assets and liabilities denominated in currencies other than the functional currency of the charity are translated at the rates of exchange prevailing at the end of the reporting period.

Transactions in currencies other than the functional currency of the charity are recorded at the rate of exchange on the date that the transaction occurred.

All exchange differences are are taken into account in arriving at net income/expenditure.

Hire purchase and leasing commitments

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

Operating lease payments are recognised as an expense on a straight-line basis over the lease term. In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis.

Pension costs and other post-retirement benefits

The charitable company operates a defined contribution pension scheme. Contributions payable to the charitable company's pension scheme are charged to the Statement of Financial Activities in the period to which they relate.

The charity contributes to a defined contribution pension scheme under the automatic enrolment regime. Contributions are charged to the Statement of Financial Activities in the period in which they relate.

Financial instruments

The charitable company only has financial assets and liabilities off a kind that qualify as basic financial instruments, which are initially recognised at transaction value and subsequently measured at their settlement value. These include debtors, bank and cash balances and creditors.

Trade and other debtors

Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other shortterm highly liquid investments with original maturities of three months or less and bank overdrafts.

Trade and other creditors

Short term creditors are measured at the transaction price. Other creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.

There are no key judgments.

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

2. Donations and legacies

Donations Investment income Investments	2020 2019 £ 2,242,972 £ 1,350,330 2020 2019 £ 1,044,261 £ 443,459

3. Investment income

Investment income of £1,044,261 ( €1,142,159) was received in 2020 as a consequence of a distribution from a private equity investment held by the Charity, see note 11.

4. Charitable activities costs

Project expenditure Support cost 5. Support costs Management Support cost £ 337,863 6. Net income/(expenditure) Net income/(expenditure) is stated after charging/(crediting): Auditors remuneration Depreciation - owned assets Other operating leases	Direct Support costs (see Costs £ 1,977,524 note 5) £ - - 496,549 1,977,524 496,549 Governance Finance costs £ 78,999 £ 79,687 2020 £ 14,400 12,588 215,601	Totals £ 1,977,524 496,549	Totals £ 1,977,524 496,549
		2,474,073
			Totals £ 496,549
			2019 £ 15,175 16,165 225,093

7. Trustees' remuneration and benefits

There were no trustees' remuneration or other benefits for the year ended 31 December 2020 nor for the year ended 31 December 2019.

Page 24

THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

7. Trustees' remuneration and benefits - continued

Trustees' expenses

The Portland Trust pays for Trustee indemnity insurance. No travel expenses were paid on behalf of trustees' during the year.

8. Staff costs

Wages and salaries Social security costs Other pension costs	2020 2019 £ £ 970,547 931,656 86,296 124,671 3,540 2,654 1,060,383 1,058,981

The average monthly number of employees during the year was as follows:

UK Israel Palestine	2020 4 5 6 15	2019 4 5 6 15

The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was:

£60,001 - £70,000 £70,001 - £80,000 Over £120,000 9. Comparatives for the statement of financial activities Unrestricted Income and endowments from funds £ Donations and legacies 1,226,047 Investment income 443,459 Total 1,669,506 Expenditure on Charitable activities Project expenditure 1,052,592 Support cost 610,898 Total 1,663,490 NET INCOME/(EXPENDITURE) 6,016	2020 1 1 3 5 Restricted funds £ 124,283 - 124,283 605,576 - 605,576 (481,293)	2019 1 1 3 5 Total funds £ 1,350,330 443,459
		1,793,789 1,658,168 610,898 2,269,066 (475,277)

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

9. Comparatives for the statement of financial activities - continued Unrestricted Restricted Total funds funds funds £ £ £ Reconciliation of funds Total funds brought forward 361,456 667,029 1,028,485 Total funds carried forward 367,472 185,736 553,208 10. Tangible fixed assets Fixtures Improvements and Computer to property fittings equipment Totals £ £ £ £ Cost At 1 January 2020 35,409 37,820 50,096 123,325 Additions - 5,493 3,681 9,174 Disposals - - (9,879) (9,879) Exchange differences - (199) 558 359 At 31 December 2020 35,409 43,114 44,456 122,979 Depreciation At 1 January 2020 17,114 32,069 44,152 93,335 Charge for year 7,081 2,473 3,034 12,588 Eliminated on disposal - - (9,879) (9,879) Exchange differences - (672) 2,909 2,237 At 31 December 2020 24,195 33,870 40,216 98,281 Net book value At 31 December 2020 11,214 9,244 4,240 24,698 At 31 December 2019 18,295 5,751 5,944 29,990 11. Fixed asset investments Cost Unlisted investments £ At 1 January 2020 and 31 December 2020 5 Net book value At 31 December 2020 5 At 31 December 2019 5		Total funds £ 1,028,485
		553,208

There were no investment assets outside the UK.

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

11. Fixed asset investments - continued

During 2007 The Portland Trust was offered the opportunity to acquire a private equity partnership in Apax Europe VII founder LP at a cost of 6 Euros. Any distributions from this investment are dependent on the performance of the Apax Europe VII Fund over time. The timing and quantification of any future distributions cannot reliably be determined by the Trustees. The investment is therefore held at cost in the balance sheet at 31 December 2020 and 31 December 2019. The Trust received a distribution of €1,142,159 in March 2020 from Apax Europe VII Founder LP and additional distributions may be received in the future. There are no commitments or liabilities associated with this investment.

During 2013 The Portland Trust invested NIS1 in purchasing 11% of the shares of Social Finance Israel, a public benefit company. The value of this investment is £nil as no future monetary benefit will be received.

12. Debtors

Amounts falling due within one year: 13. 14. Other debtors Prepayments and accrued income Amounts falling due after more than one year: Other debtors Aggregate amounts Creditors: amounts falling due within one year Social security and other taxes Other creditors Accruals and deferred income Analysis of net assets between funds Unrestricted funds £ Fixed assets 24,698 Investments 5 Current assets 1,376,229 Current liabilities (219,775) 1,181,157	Restricted funds £ - - 185,211 - 185,211	2020 £ 70,705 38,767 109,472 70,769 180,241 2020 £ 32,047 31,747 155,981 219,775 2020 Total funds £ 24,698 5 1,561,440 (219,775) 1,366,368	2019 £ 131,754 215,216 346,970 69,371 416,341 2019 £ 29,657 68,260 140,023 237,940 2019 Total funds £ 29,990 5 761,153 (237,940) 553,208

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

15. Movement in funds

Unrestricted funds Unrestricted funds Restricted funds Restricted funds TOTAL FUNDS Net movement in funds, included in the above are as follows: Unrestricted funds Unrestricted funds Restricted funds Restricted funds TOTAL FUNDS Comparatives for movement in funds Unrestricted funds Unrestricted funds Restricted funds Restricted funds TOTAL FUNDS Comparative net movement in funds, included in the above are as Unrestricted funds Unrestricted funds Restricted funds Restricted funds TOTAL FUNDS	At 1/1/20 £ 367,472 185,736 553,208 Incoming resources £ 2,431,333 855,900 3,287,233 At 1/1/19 £ 361,456 667,029 1,028,485 follows: Incoming resources £ 1,669,506 124,283 1,793,789	Net movement in funds £ 813,685 (525) 813,160 Resources expended £ (1,617,648) (856,425) (2,474,073) Net movement in funds £ 6,016 (481,293) (475,277) Resources expended £ (1,663,490) (605,576) (2,269,066)	At 31/12/20 £ 1,181,157 185,211 1,366,368 Movement in funds £ 813,685 (525) 813,160 At 31/12/19 £ 367,472 185,736 553,208 Movement in funds £ 6,016 (481,293) (475,277)

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THE PORTLAND TRUST

Notes to the Financial Statements - continued for the year ended 31 December 2020

16. Related party disclosures

During the year, The Portland Trust received £500,000 (2019: £499,632) from The R and S Cohen Foundation, a charity of which Sir R Cohen is also a Trustee.

The Heathside Charitable Trust, of which Sir H Solomon is also a Trustee donated £50,000 (2019: £50,000) to The Portland Trust..

Sir M Davis is a Trustee of The Portland Trust and donated £150,000 (2019: £nil). In 2019, The Davis Foundation, of which Sir M Davis is also a Trustee, donated £200,000 to The Portland Trust.

The Portland Trust received donations of £269,274 (NIS 1,187,805) from Yad Hanadiv (2019: £83,827 ( NIS 381,541)) of which Sir R Cohen is a Trustee.

In 2020, the Charity paid £7,793 to Portland Place Capital for bookkeeping and IT support. In 2020, expenditure of £264 was paid via recharges to Portland Place Capital. The £264 relates to private healthcare. This expenditure was charged at cost and offered an opportunity to achieve cost savings not otherwise available. Sir R Cohen is a shareholder of Portland Place Capital Ltd.

Sir R Cohen is Chair of Social Finance Israel of which The Portland Trust and Mrs N Cobbold are founding shareholders. In 2020 The Portland Trust made a grant of $250,000 to SFI.

17. Ultimate controlling party

The company is limited by guarantee and has no share capital; thus no single party controls the company.

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