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2020-08-31-accounts

REGISTERED COMPANY NUMBER: 05900619 (England and Wales) REGISTERED CHARITY NUMBER: 1115976

REPORT OF THE TRUSTEES AND

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020

FOR

GRACE DIEU MANOR SCHOOL

Duncan & Toplis Limited, Statutory Auditor 3 Princes Court Royal Way Loughborough Leicestershire LE11 5XR

GRACE DIEU MANOR SCHOOL

CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020

Page
Report of the Trustees 1 to 6
Report of the Independent Auditors 7 to 8
Statement of Financial Activities 9
Balance Sheet 10
Cash Flow Statement 11
Notes to the Cash Flow Statement 12
Notes to the Financial Statements 13 to 24
Detailed Statement of Financial Activities 25 to 26

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 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 August 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 objects of the charity are primarily to advance education for children of the Roman Catholic religion with or without other Christian or non-Christian children in the spirit and ethos of the Institute of Charity (Rosminians) and to carry on such other charitable works as advance the Roman Catholic religion.

AIMS

As noted on Page 2 unfortunately the decision had to be taken to close the school from July 2020. Until that time through the work in the school, the charity seeked to provide an education for children in the spirit of the Gospel and the traditions of the Catholic Faith.

In particular, Grace Dieu aimed to:

PUBLIC BENEFIT

The trustees have considered the guidance contained in the Charity Commission's General Guidance on Public Benefit and, in particular, its supplementary Public Benefit Guidance on advancing education and on fee charging, when exercising their powers and duties and planning the future of the charity.

Main Objectives and Strategies for the Year

STRATEGIC REPORT

Achievement and performance

The school performed well during 2019/20 in terms of pupil outcomes. The nursery facility was a significant success and expanded rapidly during this time. However the school struggled with reducing pupil numbers.

CHARITABLE AIMS

During the year the school continued to actively support fundraising activities for the LOROS and CAFOD charities.

Page 1

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020

STRATEGIC REPORT Financial review

Closure of the school and nursery

The school has been lossmaking for several years and the years 2018/19 and 2019/20 were no exception. During this period the Trustees discussed the future options with the various stakeholders and it was made clear that no further funds to support school would be made available beyond the academic year 2019/20. The school was marketed for sale throughout 2018/19 and a buyer came forward in December 2019. Unfortunately, during February 2020, negotiations with the buyer broke down irrevocably leaving the Trustees with no option but to close the school at the end of the 2019/20 academic year.

On 2 March 2020 the Trustees made the announcement to all stakeholders that the school would close at the end of the summer term on 3 July 2020. At that time it was planned that whilst the school would close, the nursery, which had an excellent reputation and long waiting list, would continue to trade after the school had closed. This decision was taken prior to the closure of schools and nurseries on 20 March due to the Covid-19 pandemic. As time elapsed, it became clear that the impact of Covid-19 would make the re-opening of a financially viable nursery impossible and the Trustees took the decision to close the nursery at the same time as the school on 3 July 2020.

Financial position

Incoming resources were £2,010,559. Resources expended were £3,145,967. The total net outgoing resources for the year ended 31st August 2020 were £1,135,408.

Related Parties

During the year the Institute of Charity continued to make, significant loans to Grace Dieu Manor School. The balance at 31st August 2020 is £1,805,533 (2019: £1,255,533) but with the exception of £100,000, the loan is not subject to interest and there are no formal terms or repayment date. Interest is charged on £100,000 at 2% per annum and £Nil of interest was paid in the year (2019: £2,000), this element is repayable on 1 July 2021. Subsequent to the year-end, the Institute of Charity has lent the school a further £185,522.

In 2010 Ratcliffe College made a loan to Grace Dieu Manor School. The loan carries a rate of interest 3% above the base rate and is repayable over 10 years. No repayments of capital or interest (2019: £Nil) were made during the year and the balance at 31st August 2020 is £22,985. (2019: £22,985).

Reserves Policy

At 31st August 2020, the unrestricted funds of the charitable company were Negative £413,810 (2019: £721,598). £2,212,154 is represented by fixed assets. Therefore the charitable company currently has no free reserves and is reliant on borrowing and support of creditors until the School Property can be sold.

Bursary Policy

Grace Dieu Manor School offered limited bursaries due to financial constraints but is offering financial help to a number of families.

Page 2

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020

STRUCTURE, GOVERNANCE AND MANAGEMENT

The charitable company, "Grace Dieu Manor School", was incorporated on 9th August 2006 and registered under the number 1115976 with the Charity Commission. From 1st September 2006, the company took over the net assets and operations of the charity "Trustees of Ratcliffe College" (established by a Trust Deed executed in 1923) which related to Grace Dieu Manor School, a school at Thringstone, Leicestershire, founded in 1933. At the same time, the remaining net assets and operations of the charity "Trustees of Ratcliffe College" were transferred to a second charitable company, "Ratcliffe College" (Charity Number 1115975), which operates a school of the same name at Fosse Way, Ratcliffe on the Wreake, Leicestershire, founded in 1847.

CONNECTED CHARITIES

The Institute of Charity (Charity Number 222508) and Ratcliffe College (Charity Number 1115975) are considered to be connected to the charitable company because they have:

GOVERNANCE

The Foundations were made by the Religious Congregation called the Institute of Charity (often called the Rosminians after the founder Antonio Rosmini). The trustees are members of the congregation. Members of the congregation provide chaplaincy facilities in the school.

Many trustees are members of the Rosminian Order. New trustees are appointed by Fr Provincial in consultation with the Board of Trustees. Where additional trustees are required, they are either appointed from the members of the Rosminians or the charity encourages existing trustees and governors to put forward names or discusses with similar organisations whether they are aware of suitable candidates. There are 3 lay trustees: Mr R Gamble, Mr P Rudd and Dr S Bolt

The Governing Body consisted of up to twelve members, of whom two were trustees (Foundation Governors); the remaining ten were appointed by the trustees (Ordinary Governors) after consultation with the Governing Body. The Terms of Service are detailed in the Memorandum and Articles of Association, Article 55.

Where additional governors were required, the charity encouraged existing trustees and governors to put forward names or discuss with similar organisations whether they were aware of suitable candidates.

MANAGEMENT

The trustees entrusted the management of the school to the Board of Governors, whose powers and duties are set out in the Memorandum and Articles of Association, Article 55.

The trustees were kept fully informed of the management of the school, receiving Reports and Minutes of the Governors' meetings, and their Sub Committees. These were reviewed regularly in the trustees' meetings. The accounts attached show the financial position of the school, which is commented on in the various notes therein.

The Board of Governors met 3 times a year to review its overall management and control for which they are legally responsible. The Finance and General Purposes Committee met at least once a term, usually 2 weeks prior to the Main Board meeting.

The trustees receive no remuneration for their services, nor (where applicable) for the work they do in the school. The trustees are entitled to recoup legitimate expenses incurred in the course of their duties as trustees.

Page 3

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020

RISK MANAGEMENT

The Board of Governors had 5 Sub-Committees, which reported to the Board at their termly meetings. The Sub-Committees were as follows:

PROTECTION OF CHILDREN & VULNERABLE ADULTS

Along with all other organisations who serve in the community, the trustees recognise the absolute necessity of ensuring the protection and safety of all those the charity serves. This means that anyone in any kind of work associated with the school, whether they are paid employees or volunteers, have to obtain enhanced disclosure clearance from the Disclosure and Barring Service. The trustees are committed to implementing all policies and procedures of the Catholic Office for the Protection of Children and Vulnerable Adults (COPCA) and those statutory requirements demanded in law (DFE) and deemed as 'compliant' by Independent Schools Inspectorate. The Headmistress was the School's Designated Senior Person for Safeguarding and the Assistant Head was the Deputy Designated person up until the schools closure. The Headmistress will have received the appropriate training as Designated Senior Persons for Safeguarding. All staff received regular updates on Safeguarding, together with the attendant policies and procedures.

Page 4

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020

REFERENCE AND ADMINISTRATIVE DETAILS

Grace Dieu Manor School is a Charitable Company, Charity Reference Number 1115976, Company Registration number 5900619. The Registered Office and Principal address of the Company is:

Grace Dieu Manor School Whitwick Coalville Leicestershire LE67 5UG

DIRECTORS

The present directors of the company (who are also the charity trustees), are:-

Rev. Fr. Brian E. Cuddihy (Correspondent) - resigned 31 October 2019 Dr Sheelagh Bolt Rev. Fr. Anthony Furlong Rev. Fr. Christopher Fuse Mr Richard Gamble Rev. Fr. Anthony Meredith Rev. Fr. David Myers Rev. Fr. Tom Thomas Rev. Fr. Philip Sainter Mr P R F Rudd

GOVERNORS

The School has its own Governing Body. The members who have served during the year are as follows:

Name Area of responsibility
Mr Richard Gamble Chair of Governors: Education; Pastoral; Finance & General
Purposes
Mr Martin Collins Finance & General Purposes; Marketing
Mrs Holly Cross Education; Pastoral; Sport
Mr Edward de Lisle Vice Chair of Governors; Finance & General Purposes
Mr Philip Fantham Finance & General Purposes; Marketing; Sports
Mr David Finn Finance & General Purposes
Mr Edward Gamble Education; Marketing; Sports
Rev Fr. Philip Sainter Foundation Governor; Pastoral
Miss K Lester Finance & General Purposes; Education; Pastoral;
Marketing
Key Executives and Professional Advisers
The Headmaster: Mrs Margaret Kewell
Bankers: Natwest, Market Place, Loughborough, Leicestershire,
LE11 3NZ
Solicitors: Veale Wasbrough Vizards LLP, Narrow Quay House, ,
Narrow Quay, Bristol, BS1 4QA
Auditors: Duncan & Toplis Limited, 3 Princes Court, Royal Way,
Loughborough, LE11 5XR

Page 5

GRACE DIEU MANOR SCHOOL

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020

STATEMENT OF TRUSTEES' RESPONSIBILITIES

The trustees (who are also the directors of Grace Dieu Manor School 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).

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

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:

As explained in note 25 to the financial statements, the trustees do not believe the going concern basis to be appropriate and these financial statements have not been prepared on that basis.

Report of the trustees, incorporating a strategic report, approved by order of the board of trustees, as the company directors, on ............................................. and signed on the board's behalf by:

........................................................................ R W Gamble - Trustee

Page 6

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF GRACE DIEU MANOR SCHOOL

Disclaimer of Opinion

We were engaged to audit the financial statements of Grace Dieu Manor School (the 'charitable company') for the year ended 31 August 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).

We do not express an opinion on the accompanying financial statements of the charitable company. Because of the significance of the matter described in the basis for the disclaimer of opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

Basis for disclaimer of opinion

Following the closure of the school in July 2020 and the subsequent cessation of employment of the charitable company's employees including the finance team we have been unable to gain access to sufficient records, systems and information to perform sufficient and appropriate audit testing to satisfy ourselves that the material transactions and balances shown in the Statement of Financial Activities, the Balance Sheet, the Cash Flow Statement and notes to the financial statements are materially accurate and correct. We are therefore unable to provide an opinion on the accuracy of the financial statements as a whole.

Opinions on other matters prescribed by the Companies Act 2006

Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have been unable to form an opinion, whether based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the Report of the Trustees.

Arising from the limitation of our work referred to above:

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:

Page 7

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF GRACE DIEU MANOR SCHOOL

Responsibilities of trustees

As explained more fully in the Statement of Trustees' Responsibilities, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements 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 responsibility is to conduct an audit of the company's financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor's report.

However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

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.

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.

Niall Kingsley ACA (Senior Statutory Auditor)

for and on behalf of Duncan & Toplis Limited, Statutory Auditor 3 Princes Court Royal Way Loughborough Leicestershire LE11 5XR

Date: .............................................

Page 8

GRACE DIEU MANOR SCHOOL

STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING AN INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 AUGUST 2020

Notes
INCOME AND ENDOWMENTS FROM
Donations and legacies
3
Charitable activities
6
School fees
Other trading activities
4
Investment income
5
Other income
Total
EXPENDITURE ON
Charitable activities
7
Teaching costs
Welfare
Premises
Support costs
Other
Total
NET INCOME/(EXPENDITURE)
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD		 Unrestricted
fund
£
-
1,740,838
13,117
2,070
254,534
2,010,559
1,815,956
276,447
441,188
560,178
52,198
3,145,967
(1,135,408)
721,598
(413,810)		 Restricted
funds
£
-
-
-
-
-
-
-
-
-
-
-
-
-
42,019
42,019		 2020
Total
funds
£
-
1,740,838
13,117
2,070
254,534
2,010,559
1,815,956
276,447
441,188
560,178
52,198
3,145,967
(1,135,408)
763,617
(371,791)		 2019
Total
funds
£
30
2,253,534
15,456
4,013
-
2,273,033
1,619,713
327,428
555,925
566,164
57,110
3,126,340
(853,307)
1,616,924
763,617

The notes form part of these financial statements

Page 9

GRACE DIEU MANOR SCHOOL (REGISTERED NUMBER: 05900619)

BALANCE SHEET 31 AUGUST 2020

Notes
FIXED ASSETS
Tangible assets
14
CURRENT ASSETS
Stocks
15
Debtors
16
Cash at bank and in hand
CREDITORS
Amounts falling due within one year
17
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
CREDITORS
Amounts falling due after more than one year
18
NET ASSETS
FUNDS
21
Unrestricted funds
Restricted funds
TOTAL FUNDS		 Unrestricted
fund
£
2,212,154
-
41,824
189,801
231,625
(2,100,292)
(1,868,667)
343,487
(757,297)
(413,810)		 Restricted
funds
£
-
-
-
42,019
42,019
-
42,019
42,019
-
42,019		 2020
Total
funds
£
2,212,154
-
41,824
231,820
273,644
(2,100,292)
(1,826,648)
385,506
(757,297)
(371,791)
(413,810)
42,019
(371,791)		 2019
Total
funds
£
2,407,125
13,352
34,352
786,363
834,067
(1,582,344)
(748,277)
1,658,848
(895,231)
763,617
721,598
42,019
763,617

The financial statements were approved by the Board of Trustees and authorised for issue on ............................................. and were signed on its behalf by:

............................................. R W Gamble - Trustee

The notes form part of these financial statements

Page 10

GRACE DIEU MANOR SCHOOL

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 AUGUST 2020

Notes
Cash flows from operating activities
Cash generated from operations
1
Finance costs paid
Net cash used in operating activities
Cash flows from investing activities
Purchase of tangible fixed assets
Sale of tangible fixed assets
Sale of investment property
Interest received
Net cash provided by investing activities
Cash flows from financing activities
New loans in year
Loan repayments in year
Capital repayments in year
Net cash provided by financing 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
£
(1,059,192)
(52,198)
(1,111,390)
-
43,491
-
1,030
44,521
550,000
(25,245)
(7,199)
517,556
(549,313)
781,133
231,820		 2019
£
(654,147)
(57,110)
(711,257)
(7,834)
1,753
707,250
360
701,529
904,634
(9,025)
(5,102)
890,507
880,779
(99,646)
781,133

The notes form part of these financial statements

Page 11

GRACE DIEU MANOR SCHOOL

NOTES TO THE CASH FLOW STATEMENT FOR THE YEAR ENDED 31 AUGUST 2020

1.
RECONCILIATION OF NET EXPENDITURE TO NET CASH FLOW FROM OPERATING ACTIVITIES
2020
£
Net expenditure for the reporting period (as per the Statement of
Financial Activities)
(1,135,408)
Adjustments for:
Depreciation charges
194,970
(Profit)/loss on disposal of fixed assets
(43,491)
Interest received
(1,030)
Finance costs
52,198
Impairment of tangible fixed assets
-
Decrease/(increase) in stocks
13,352
(Increase)/decrease in debtors
(7,472)
Decrease in creditors
(132,311)
Net cash used in operations
(1,059,192)
2.
ANALYSIS OF CASH AND CASH EQUIVALENTS
2020
£
Cash in hand
-
Notice deposits (less than 3 months)
231,820
Overdrafts included in bank loans and overdrafts falling due within one year
-
Total cash and cash equivalents
231,820
3.
ANALYSIS OF CHANGES IN NET DEBT		 1.
RECONCILIATION OF NET EXPENDITURE TO NET CASH FLOW FROM OPERATING ACTIVITIES
2020
£
Net expenditure for the reporting period (as per the Statement of
Financial Activities)
(1,135,408)
Adjustments for:
Depreciation charges
194,970
(Profit)/loss on disposal of fixed assets
(43,491)
Interest received
(1,030)
Finance costs
52,198
Impairment of tangible fixed assets
-
Decrease/(increase) in stocks
13,352
(Increase)/decrease in debtors
(7,472)
Decrease in creditors
(132,311)
Net cash used in operations
(1,059,192)
2.
ANALYSIS OF CASH AND CASH EQUIVALENTS
2020
£
Cash in hand
-
Notice deposits (less than 3 months)
231,820
Overdrafts included in bank loans and overdrafts falling due within one year
-
Total cash and cash equivalents
231,820
3.
ANALYSIS OF CHANGES IN NET DEBT		 1.
RECONCILIATION OF NET EXPENDITURE TO NET CASH FLOW FROM OPERATING ACTIVITIES
2020
£
Net expenditure for the reporting period (as per the Statement of
Financial Activities)
(1,135,408)
Adjustments for:
Depreciation charges
194,970
(Profit)/loss on disposal of fixed assets
(43,491)
Interest received
(1,030)
Finance costs
52,198
Impairment of tangible fixed assets
-
Decrease/(increase) in stocks
13,352
(Increase)/decrease in debtors
(7,472)
Decrease in creditors
(132,311)
Net cash used in operations
(1,059,192)
2.
ANALYSIS OF CASH AND CASH EQUIVALENTS
2020
£
Cash in hand
-
Notice deposits (less than 3 months)
231,820
Overdrafts included in bank loans and overdrafts falling due within one year
-
Total cash and cash equivalents
231,820
3.
ANALYSIS OF CHANGES IN NET DEBT		 2019
£
(853,307)
141,081
1,897
(360)
57,110
63,083
(4,532)
875
(59,994)
(654,147)
2019
£
150
786,213
(5,230)
781,133
2020
£
-
231,820
-
231,820
At 1.9.19 Cash flow At 31.8.20
£ £ £
Net cash
Cash at bank and in hand 786,363 (554,543) 231,820
Bank overdraft (5,230) 5,230 -
781,133 (549,313) 231,820
Debt
Finance leases (29,312) 7,199 (22,113)
Debts falling due within 1 year (1,236,324) (654,472) (1,890,796)
Debts falling due after 1 year (872,649) 129,717 (742,932)
(2,138,285) (517,556) (2,655,841)
Total (1,357,152) (1,066,869) (2,424,021)

The notes form part of these financial statements

Page 12

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020

1. GENERAL INFORMATION

Grace Dieu Manor School is a charitable company, limited by guarantee, registered in England and Wales. The company's registered number is 05900619 and registered office address is Grace Dieu Manor School, Whitwick, Coalville, Leicestershire, LE67 5UG.

The financial statements are presented in sterling which is the functional currency of the charitable company and rounded to the nearest £.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

The financial statements cover the individual entity.

2. 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.

As explained in note 25, the charitable company ceased operations in July 2020. Consequently, the going concern assumption is not appropriate and the financial statements have been prepared on a realisation basis where assets are measured at the lower of carrying amounts and estimated net realisable values, while liabilities are measured at their estimated settlement amounts.

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.

Expenditure

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources.

Tangible fixed assets

Tangible fixed assets are stated at cost less accumulated depreciation. Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold land is not depreciated

Freehold buildings 2% - 20% on depreciated replacement cost/valuation
Plant and machinery 20% on cost
Fixtures, fittings and equipment 10% on cost
Motor vehicles 25% on cost

The freehold land and buildings were previously valued using professional valuers as at 1 September 2006, the date the assets were transferred from the old charity. This valuation was frozen and adopted as the deemed historical cost. The land and buildings were valued on the following basis:

continued...

Page 13

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

2. ACCOUNTING POLICIES - continued

Tangible fixed assets

  1. Main college/school and buildings on site - depreciated replacement cost value

  2. Other buildings - open market value

At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is estimated and compared with its carrying amount. If the estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in the Statement of Financial Activities.

If an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment is recognised immediately in the Statement of Financial Activities.

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in market value is transferred to a revaluation reserve.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

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

Fund accounting

Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees.

Restricted funds can only be used for particular restricted purposes within the objects of the charity. Restrictions arise when specified by the donor or when funds are raised for particular restricted purposes.

Further explanation of the nature and purpose of each fund is included in the notes to the financial statements.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible assets and depreciated over the shorter of the lease term and their useful lives. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the Statement of Financial Activities so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Rentals payable under operating leases are charged against income on a straight line basis over the period of the lease.

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.

Contributions are made for teaching staff to the Department for Education Superannuation Scheme ("TPS"). For the purposes of complying with relevant accounting standards the TPS is accounted for as a defined contribution scheme as the charitable company is not responsible for or entitled to receive benefit for any surplus or deficit of the scheme.

continued...

Page 14

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

2. ACCOUNTING POLICIES - continued

Loans and borrowings

Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, they are measured at amortised cost using the effective interest rate method, less impairment. If an arrangement constitutes a finance transaction it is measured at present value.

Financial instruments

The charitable company has chosen to adopt the Sections 11 and 12 of FRS 102 in respect of financial instruments.

Basic financial assets, including trade and other debtors and cash and bank balances are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in the Statement of Financial Activities.

Basic financial liabilities, including trade and other creditors, bank loans and loans from connected entities, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of the charitable company's activities. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

3. DONATIONS AND LEGACIES

Donations
4.
OTHER TRADING ACTIVITIES
Trading activities		 2020
£
-
2020
£
13,117		 2019
£
30
2019
£
15,456

continued...

Page 15

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

5. INVESTMENT INCOME

Rents received
Deposit account interest
6.
INCOME FROM CHARITABLE ACTIVITIES
Activity
Fees receivable
School fees
Bursaries and other
allowances
School fees
Other fee income
School fees		 2020
£
1,040
1,030
2,070
2020
£
1,852,501
(155,388)
43,725
1,740,838		 2019
£
3,653
360
4,013
2019
£
2,370,403
(204,187)
87,318
2,253,534

7. CHARITABLE ACTIVITIES COSTS

CHARITABLE ACTIVITIES COSTS
Teaching costs
Welfare
Premises
Support costs		 Direct
Costs
£
1,815,956
276,447
441,188
560,178
3,093,769

Charitable activities costs includes payments to the auditor of £11,380 (2019: £16,252) for audit fees.

Other resources expended of £52,198 (2019: £57,110) represents interest paid on borrowings.

8. NET INCOME/(EXPENDITURE)

Net income/(expenditure) is stated after charging/(crediting):

2020 2019
£ £
Depreciation - owned assets 194,971 141,081
Surplus/(deficit) on disposal of fixed assets (43,491) 1,897
Impairment of tangible fixed assets - 63,083

continued...

Page 16

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

9. TRUSTEES' REMUNERATION AND BENEFITS

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

Trustees' expenses

There were no trustees' expenses paid for the year ended 31 August 2020 nor for the year ended 31 August 2019.

10. STAFF COSTS

STAFF COSTS
Wages and salaries
Social security costs
Other pension costs		 2020
£
1,569,180
-
191,876
1,761,056		 2019
£
1,636,964
103,116
157,806
1,897,886

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

Teaching staff
Support staff		 2020
26
62
88		 2019
26
62
88

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

2020 2019
£100,001 - £110,000 1 1

The average number of employees during the year, calculated on a full time equivalent basis was 20 (2019: 20) for teaching staff and 47 (2019: 47) for support staff.

Of the employees whose emoluments exceed £60,000, 1 (2019: 1) has retirement benefits accruing under a defined benefit pension scheme.

continued...

Page 17

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

11. EXCEPTIONAL ITEMS

The charitable company classifies certain one off charges that have a material impact on the financial results as an 'exceptional item'. This is disclosed separately to provide further understanding of the financial performance of the charity.

During the prior year, £63,083 charges for asset write downs of exceptional size or incidence were recorded, relating to the impairment of tangible fixed assets. The trustees re-assessed their estimates of the useful economic lives of fixtures & fittings, plant & machinery and computer equipment, resulting in an impairment charge of £63,083 to the statement of financial activities in the prior year.

During the year redundancy costs of £259,809 were incurred following the closure of the school.

12. COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES

INCOME AND ENDOWMENTS FROM
Donations and legacies
Charitable activities
School fees
Other trading activities
Investment income
Total
EXPENDITURE ON
Charitable activities
Teaching costs
Welfare
Premises
Support costs
Other
Total
NET INCOME/(EXPENDITURE)
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD		 Unrestricted
fund
£
30
2,253,534
15,456
4,013
2,273,033
1,619,713
327,428
555,925
566,164
57,110
3,126,340
(853,307)
1,574,905
721,598		 Restricted
funds
£
-
-
-
-
-
-
-
-
-
-
-
-
42,019
42,019		 Total
funds
£
30
2,253,534
15,456
4,013
2,273,033
1,619,713
327,428
555,925
566,164
57,110
3,126,340
(853,307)
1,616,924
763,617

continued...

Page 18

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

13. KEY MANAGEMENT PERSONNEL REMUNERATION AND EXPENSES

The total amount of employee benefits received by key management personnel is £116,525 (2019: £116,525).

14. TANGIBLE FIXED ASSETS

COST
At 1 September 2019
Disposals
At 31 August 2020
DEPRECIATION
At 1 September 2019
Charge for year
Eliminated on disposal
At 31 August 2020
NET BOOK VALUE
At 31 August 2020
At 31 August 2019		 Freehold
property
£
7,167,259
-
7,167,259
4,861,444
93,661
-
4,955,105
2,212,154
2,305,815		 Fixtures
and
fittings
£
586,953
-
586,953
498,977
87,976
-
586,953
-
87,976		 Motor
vehicles
£
70,133
(11,200)
58,933
70,133
-
(11,200)
58,933
-
-		 Computer
equipment
£
341,497
-
341,497
328,163
13,334
-
341,497
-
13,334		 Totals
£
8,165,842
(11,200)
8,154,642
5,758,717
194,971
(11,200)
5,942,488
2,212,154
2,407,125

An impairment review was carried out by management in order to re-assess their estimates of the useful economic lives of tangible fixed assets. Following this review, the total net book value of those fixtures & fittings, plant & machinery and computer equipment assets were written down by £63,083 in the prior year.

The net book value of assets held under finance leases included in fixtures and fittings is £Nil (2019: £17,393).

15. STOCKS

Finished goods
16.
DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Trade debtors
Other debtors
Prepayments and accrued income		 2020
£
-
2020
£
204
4,249
37,371
41,824		 2019
£
13,352
2019
£
2,056
730
31,566
34,352

continued...

Page 19

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

17. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Bank loans and overdrafts (see note 19)
Other loans (see note 19)
Finance leases (see note 20)
Payments on account
Trade creditors
Social security and other taxes
Other creditors
Accruals and deferred income		 2020
£
62,278
1,828,518
7,748
-
12,219
34,693
32,606
122,230
2,100,292		 2019
£
65,935
1,175,619
6,730
77,330
78,588
35,948
79,206
62,988
1,582,344

Deferred income arose in the prior year due to fees paid in advance for school fees relating to the current accounting year.

18. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Bank loans (see note 19)
Other loans (see note 19)
Finance leases (see note 20)		 2020
£
742,932
-
14,365
757,297		 2019
£
769,750
102,899
22,582
895,231

The bank loan is being repaid over 20 years to 2029 at a fixed interest rate of 6.0%. The bank loan is secured by charges over the school, buildings and land at Grace Dieu Manor School.

Included within other loans are amounts owed to the Institute of Charity. The loan includes £100,000 that carries a rate of interest of 2% per annum and is repayable over 3 years to July 2021. The loan is unsecured.

19. LOANS

An analysis of the maturity of loans is given below:

Amounts falling due within one year on demand:
Bank overdrafts
Bank loans
Other loans
Amounts falling between one and two years:
Bank loans - 1-2 years
Other loans - 1-2 years
Amounts falling due between two and five years:
Bank loans - 2-5 years		 2020
£
-
62,278
1,828,518
1,890,796		 2019
£
5,230
60,705
1,175,619
1,241,554
66,150
-
66,150
224,183		 64,484
102,899
167,383
218,531

continued...

Page 20

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

19. LOANS - continued

Amounts falling due in more than five years:
Repayable by instalments:
Bank loans more 5 yr by instal
20.
LEASING AGREEMENTS
Minimum lease payments fall due as follows:
Gross obligations repayable:
Within one year
Between one and five years
Finance charges repayable:
Within one year
Between one and five years
Net obligations repayable:
Within one year
Between one and five years
Within one year
Between one and five years
In more than five years		 2020
2019
£
£
452,599
486,735
Finance leases
2020
2019
£
£
9,911
9,910
15,691
25,601
25,602
35,511
2,163
3,180
1,326
3,019
3,489
6,199
7,748
6,730
14,365
22,582
22,113
29,312
Non-cancellable operating
leases
2020
2019
£
£
3,275
4,128
12,070
13,101
-
2,244
15,345
19,473

The finance lease relates to the acquisition of kitchen equipment in the 2018 year and is repayable over the remaining 3 years to March 2023. The lease is secured on the asset to which it relates.

continued...

Page 21

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

21. MOVEMENT IN FUNDS

Unrestricted funds
General fund
Restricted funds
EYPS grant
Young Innovators Challenge
Bursary fund
Playground project
R Gamble Donation
TOTAL FUNDS
Net movement in funds, included in the above are as follows:
Unrestricted funds
General fund
TOTAL FUNDS
Comparatives for movement in funds
Unrestricted funds
General fund
Restricted funds
EYPS grant
Young Innovators Challenge
Grace Dieu Parent's Association
Bursary fund
Playground project
TOTAL FUNDS		 At 1.9.19
£
721,598
73
746
25,000
11,500
4,700
42,019		 Net
movement
in funds
£
(1,135,408)
-
-
-
-
-
-		 At
31.8.20
£
(413,810)
73
746
25,000
11,500
4,700
42,019
(371,791)
Movement
in funds
£
(1,135,408)
(1,135,408)
At
31.8.19
£
721,598
73
746
4,700
25,000
11,500
42,019
763,617
763,617
Incoming
resources
£
2,010,559		 (1,135,408)
Resources
expended
£
(3,145,967)
2,010,559
At 1.9.18
£
1,574,905
73
746
4,700
25,000
11,500
42,019		 (3,145,967)
Net
movement
in funds
£
(853,307)
-
-
-
-
-
-
1,616,924 (853,307)

continued...

Page 22

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

21. MOVEMENT IN FUNDS - continued

Comparative net movement in funds, included in the above are as follows:

Unrestricted funds
General fund
TOTAL FUNDS		 Incoming
resources
£
2,273,033
2,273,033		 Resources
expended
£
(3,126,340)
(3,126,340)		 Movement
in funds
£
(853,307)
(853,307)

The bursary fund comprises funds donated towards scholarships and bursaries.

Early years professional status (EYPS) grant is money received from Leicestershire County Council to provide financial support for the training of staff.

The Young Innovators Challenge is prize money received from the 2015 Super Food Challenge which is to be spent on food technology equipment.

The Grace Dieu Parent's Association donate money to the charity for a variety of purposes, including school equipment, the prize day fun fair and the Christmas fayre.

The Playground project is monies received towards playground equipment.

22. EMPLOYEE BENEFIT OBLIGATIONS

The teaching staff are members of the Department for Education Superannuation Scheme which is a defined benefits scheme. The Scheme permits staff to make additional voluntary contributions. The Department instructs the school as to the level of contribution, 16.48% for the school and between 7.4% and 11.7% for the employees. The school does not have any commitment to make good any actuarial deficit.

The Grace Dieu Manor School Monthly Pension Scheme is the scheme open for non teaching staff and is a defined contribution occupational pension scheme. The scheme is administered by The Peoples' Pension Organisation. Contribution rates are 5% for members and 3% or 8.6% for the charity .

Contributions totalling £32,214 (2019: £23,822) were payable to the schemes at the year end.

23. RELATED PARTY DISCLOSURES

The Institute of Charity (Charity Number 222508) and Ratcliffe College (Charity Number 1115975) are considered to be connected to the charitable company because they have:

During the year, the charity received a further loan from the Institute of Charity totalling £550,000. £100,000 of the loan carries a rate of interest of 2% per annum and was repayable over 3 years to July 2021. Interest payable for the year is £2,000 (2019: £2,000). Subject to the £100,000 there are no formal terms attached to the remainder of these loans and therefore they are deemed repayable on demand. The total balance owed as at 31st August 2020 is £1,805,533 (2019: £1,255,533).

continued...

Page 23

GRACE DIEU MANOR SCHOOL

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 AUGUST 2020

23. RELATED PARTY DISCLOSURES - continued

During the year ending 2010 the Ratcliffe College Pension and Life Assurance Scheme was closed at a total cost of £713,950. Of this £428,517 was paid using the assets of the Scheme and the remaining £285,433 was due from Ratcliffe College (56%) and Grace Dieu Manor School (44%). The charity received a loan from Ratcliffe College to enable their contribution to be paid. This loan carries a rate of interest 3% above the base rate and is repayable over 10 years. Interest paid in the year was £Nil (2019: £NIL) and the balance at 31st August 2020 is £22,985 (2019: £22,985).

24. FINANCIAL INSTRUMENTS

The carrying amount of the charity's financial instruments are as follows:

2020 2019
£ £
Financial assets that are debt instruments measured at amortised cost:
Trade debtors 204 2,056
Other debtors 4,249 730
Financial liabilities measured at amortised cost:
Bank loans and overdrafts 805,210 835,685
Other loans 1,828,518 1,278,518
Finance lease 22,113 29,312
Payments on account - 77,330
Trade creditors 12,219 78,588
Other creditors 32,606 79,206

The total interest income and interest expense for financial assets and financial liabilities that are not measured at fair value through the income statement was £Nil (2019 - £Nil) and £52,198 (2019 - £57,110) respectively.

25. GOING CONCERN

The charitable company ceased operations during the year. The school has been lossmaking for several years and no further funds to support school would be made available beyond the academic year 2019/20. Negotiations to sell the school had also broken down leaving the Trustees with no option but to announce on 2 March 2020 the closure of the school at the end of the 2019/20 academic year.

At that time it was planned the nursery would continue to trade after the school had closed. This decision was taken prior to the closure of schools and nurseries on 20 March due to the Covid 19 pandemic. As �me elapsed, it became clear that the impact of Covid 19 would make the re -opening of a financially viable nursery impossible and the Trustees took the decision to close the nursery at the same time as the school on 3 July 2020.

Consequently, the going concern assumption is not appropriate and the financial statements have been prepared on a realisation basis, which includes where appropriate writing down the company's assets to net realisable value.

Page 24

GRACE DIEU MANOR SCHOOL

DETAILED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2020

INCOME AND ENDOWMENTS
Donations and legacies
Donations
Other trading activities
Trading activities
Investment income
Rents received
Deposit account interest
Charitable activities
Fees receivable
Bursaries and other allowances
Other fee income
Other income
Gain on sale of tangible fixed assets
Government grants
Total incoming resources
EXPENDITURE
Charitable activities
Wages
Social security
Pensions
Rates and water
Insurance
Light and heat
Telephone
Postage and stationery
Advertising
Sundries
School consumables
Food
Staff recruitment
Repairs and maintenance
Carried forward		 2020
£
-
13,117
1,040
1,030
2,070
1,852,501
(155,388)
43,725
1,740,838
43,491
211,043
254,534
2,010,559
1,569,180
-
191,876
22,749
38,514
96,329
6,476
22,372
8,817
2,617
94,978
149,703
15,117
114,900
2,333,628		 2019
£
30
15,456
3,653
360
4,013
2,370,403
(204,187)
87,318
2,253,534
-
-
-
2,273,033
1,636,964
103,116
157,806
24,873
40,498
100,792
7,273
17,526
27,928
17,482
112,981
205,143
6,034
100,148
2,558,564

This page does not form part of the statutory financial statements

Page 25

GRACE DIEU MANOR SCHOOL

DETAILED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2020

Charitable activities
Brought forward
Motor expenses
Travelling expenses
Legal and professional
Auditors' remuneration
Staff recruitment
Redundancy costs
Bad debts
Cleaning
Computer expenses
Subscriptions
Cottages- Rent- Grace Dieu Lodge
Depreciation
Loss on sale of tangible fixed assets
Impairment losses for tangible fixed assets
Other
Interest paid
Total resources expended
Net expenditure		 2020
£
2,333,628
6,739
1,706
241,773
11,380
-
259,809
58
28,563
4,967
10,176
-
194,970
-
-
3,093,769
52,198
3,145,967
(1,135,408)		 2019
£
2,558,564
11,863
354
232,657
16,252
3,876
-
2,561
5,561
4,865
14,516
12,100
141,081
1,897
63,083
3,069,230
57,110
3,126,340
(853,307)

This page does not form part of the statutory financial statements

Page 26