HOSTELLING IKruiNATIONAL Company number 02250706 Charity number 1117014 International Youth Hostel Federation (Operating as Hostelling International) Annual Report and Financial Statements for the Year Ended 31 December 2023 Hostelllng Internatlonal17 Bell Yard l London, WC2A 2JR l England Emall: info@hihostels.com I www.hihostels.com Registered Charity lin England & Wales) No. 11170141 Company No. 02250706
CONTENTS Report of the Board of Trustees ................ Tru5tees' responsibility statement.........-.......-......-.................-...-.......................................-......-......-......... 16 Independent Examinerfs report to the members of International Youth Hostel Federation 17 Financial Statements 19 Statement of financial activities for the year ended 31 December 2023 19 Balance sheet 35 at 31 December 2023 20 Statement of tash flows for the year ended 31 December 2023 21 Notes to the financial statements 22 Registered Office and Professional Advisors 34 HI Member Associations ............................................ 35
REPORT OF THE BOARD OF TRUSTEES ABOUT HOSTELLING INTERNATIONAL International Youth Hostel Federation loperatin8 a5 Hostelling International and referred to throughout this report as"Hl" or"IYHF"l is a registered charity and non-governmental, not-for-profit organisation representing fifty eight Member Associations IMAS) and one Associate Organisation from all over the world. It is one of the world's la¥@est yOLFth membership organisations and it is recognised by UNESCO Iunited Nations Educational Scientific and Cultural Organisationl. HI is the only global network of Youth Hostel Associations. Its nearly 3.6 million member travellers have a choice of over 3,000 hostels worldwide. all of which work with a set of internationally assured quality standards. HI'S membership savings programme 3150 gives access to thousands of travel-related savings. The history of Hostelling International The concept of hostelling was founded in Germany by Richard Schirrmann, a school teacher, in 1909. He came up with the idea of a network of youth h05te15 when he and his students were caught in thunderstorm during an excursion and were offered accommodation in a school. The first official youth hostel opened in Burg Altenè in 1912, after which the youth hostel movement grew rapidly. By the summer of 1931 there were 12 Youth H05tel Associations in Europe, operating a total of 2,600 hostels. The International Youth Hostel Federation was founded at the first International Confe¥ence in Amsterdam, the Netherlands, in 1932 where Richard Schirrmann was elected the first President. Objects The purpose of the charity is defined by our choritable object.. "To promote the education of all yOLtrn8 people of all nations, but especially young people of limited means, by encouraging in them a greater knowledge, love and care of the countryside and an appreciation of the cultural values of towns and cities in all parts of the world, and as ancillary thereto to provide hostels or other accommodation in which the shall be no distinction of origins, nationality, colour, religion, sex, class, or political opinions and thereby to develop a better understanding of their fellow men, both at home and abroad." In other words.. we exist to give young people the chance to discover the world, its cultures and fellow people in order to build a more understanding, tolerant, peaceful, enviror+mentally considerate world. OBJECTIVES AND ACTIVITIES HI achieves its mission through its international programmes, Member Association5, and h05tels. The HI network h35 fifty eight Member A550ciations and one Associate Organi5ation with over 3,000 hostel5, ensuring there is a safe, low-cost base from which young people can explore the world. HI promotes sustainable hostelling and offers to its Member Associations the Hl-Q&S Iquality and standardsl programme, which seeks to optimise the customer experience and continuous improvement of hostel operations.
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) Our website www.hihostels.com is a content and inspiration hub. signposting travellers to hostels in our network that offer an affordable and 5LlStainable way of travelling internationally. The Boafd of Trustees continue to have due regard to the Charity Commission in England and Wales's guidance on public benefit. Through careful management of HI membership income, hihostels.com income and existing funds, HI provides a public benefit by promoting and facilitating international travel for young people through programmes and safe, affordable and sustainable youth hostels. VISION AND STRATEGY In 2022 the HI Strate8y working group proposed a strategic direction and plan for the network for the period 2022-26, which was endorsed by the members at the 54, conference in September 2022. The goals for 2026 are= Growth in the number of people, overnights and income in our Federation. Growth in number of young people recognising and engaging with the HI Brand antl Federation. Growth in guest satisfaction and quality recognition. Growth in Member Associations participation in collaborative projects and pro8rams that strengthen hostelling. Increased recognition of HI'S leadership in youth travel and sustainable tourism. The Strategic Priorities to meet these goals are the following.. l. Survive. Then Thrivel - Increase Impact Support Hostelling's Recovery Win More Travellers to Hostelling Differentiate Our Hostels Increase the Visibility of Our Leadership 2. Strengthen Our Fundamentals- Functional capabilities Enhance Collaboration Better Position Our Purposeful Brand Expand Technology More Efficient Governance ACHIEVEMENTS AND PERFORMANCE IN 2023 The International Office and network continue to implement the 2022-2026 Strategic Plan designed by the CEO, Management Team and Strategy working group. In 2023, HI operates its activities under two main teams,. Network and Brand, and Technology SeNices.
REPORT OF THE BOARD OF TRUSTEES {CONTINUED) NETWORKAND 8RANt) 2023 saw the continuing post-COVID recovery of most Member Associations with travel resuming and V15itor numbers recovering. In Europe, North America and Australia 2023 was as good a year, if not better than 2019. In Asia and Africa some travel restrictions remained in place until mid-way through the year. HI continued to support the global network by facilitating frequent communication and regional calls, organising events, running international programmes, and facilitatlng the strategic worktng groups and Board projects. As part of our ongoing programme of organisational change, working together with the Brand and Strategy Working Groups. we have appointed a brand and digital transformation agency, This Brand Works ITB WI. TBW 15 helping us modernise our brand and working practices, so that we can meet our beneficiaries where they are. as digital natives, while also adding value to our MA members by ensuring we differentiate ourselves in an increasingly competitive global market place. The intention is to become a more customer focused organisation able to make decisions based on data and insights. We will clarify and simplify our value propositionls18nd strengthen our positioning by capitalising on our enviable heritage and global scale. The brand element of the project is expected to complete by September 2025 and will be launched at an appropriate time that aligns to digital strategv as it evolves. Network events Critical for communication and strong relationships in the network, face to face meetings are important events organised by HI each year. The European Regional Conference was organised by EUFED IEuropean Union Federation of Youth Hostel Assotiationsl in Israel in March to gather the Presidents and CEOS of our European member associations. Several Board Members of HI, together with our CEO, were in attendance. In September 2023, HI led the Marketing and Sustainability Forum in Evora, Portugal, where 14 Member Associations were represented by 28 delegates. Participants collaborated on issues such as marketing content planning, global partnerships, HI'S digital future, the newly introduced HI standards self- assessment. the reduction of single-use plèstics, GTPI IGlobal Tourism Plastics Initiative) and the Glasgow Declaration. Programmes & Membership Our global programmes continued with the celebration of the UN International Day of Peace on 21 September with our Soy Hi For Peoce programme with enEagement from 22 Member Association5 and 8 social media reach of over 400k people in the wider hostelling community.
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) In 2023, 10 MAS participated in the Hl-connect exchange programme. A total of 20 participants lof which 19 were staff members and I was a volunteer) were hosted in a range of hostels from our network, Whe they had the opportunity to gain a deeper understandin8 and appreciation of a different culture as well as HI'S mission, values and goals, learn new skills or enhance existing ones. and share best practiees, innovative ideas, and successful strategies with their colleague5 from different parts of the world. IOOOA of SLtrveyed participant5 recommend others to participate in Hl-connect, learned words or expressions in a different language. learned something new about tourism and hospitality and report having been inspired peisonally and professionally. 77.5% report that their understanding of their own cultural values and biases was improved by the exchange program. All of the respondents also claimed that they felt more 'part of the international network of HI" since having participated. The HI membership programme continued to benefit over 3 million member travellers across the HI network with each member association offering discounts at a national level and international discounts offered by partners of HI. With their membership travellers get access to affordable rates in all HI hostels and travel related dtscounts. HI continued to sell digital memberships on hihostels.com. Our member associations also continued to organise programmes for the hostel guests. wtth hundreds of activities and programmes across the network continuing to offer opportunities to young people of all means to explore the world and meet new people. Examples of programmes include exchange programme5, volunteering, civil service, clean.ups, shared meals, free tours and game nights. Partnerships Hostelling International collaborates with charitable organisations, youth groups, educational institutions, and like-minded global brands to advance sustainable tourism initiatives. We are an Affiliate Member of UNWTO (United Nations World Tourism Organizationl and a recognised organisation within UNESCO. We maintain our full membership status in the World Youth Student & Edutational IWYSEI Travel Confederation. Through WYSE. which brings together key stakeholders in the yOL¢th travel settor and provides access to a global network, events, and focused research, we actively engage in industry dialogues. We have attended their industry events such as STAY WYSE in January and WYSTC in September, fostering connections with stakeholders and exploring potential partnerships. In 2023, we successfully forged Blobal partnerships with six prominent global brands, enrichin@ travel experience5 for our guests and diversifying revenue streams for the HI network. Hostelling International remains committed to promoting sustainèble tourism in collaboration with our esteemed global partner5. Sustainability & Quality HI is actively involved in helping our industry moving forward with the 2030 Sustainable Goals Agenda and is part of the Global Tourism Plastics Initiative and signed the Glasgow Declaration.
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) We have continued advancing our Hl-Q&S pro8ramme by auditing and certifying or recertifying hostels in Switzerland, Belgium, Norway and Portugal. In 2023 we had a total of 364 contracted hoste15; 179 HI- Q certified. 190 HI-Q&S certified and 127 in progress lawaiting audits online or onsite in 20241. We have continued to monitor the overall guest Satisfaction of the HI network with our partner ReviewPro and have been pleased to See an overall rating of 82.5% Global Review Index, with a small increase of 0.2%. We have also continued to develop the software partnership with FORM, our new platforni that facilitates the audits and self-assessments for both HI Standards and Hl-Q&S. Thanks to our partners, the criteria for Hl-Q&S is currently translated and available online in 8 languages.. Arabic, English, Finnish. French, German Ipartiall, Portuguese, Romanian and Spanish lin progress), whilst the criteria for HI Standards is currently available in English and Spanish. Marketlng We 5UStained our direct marketing efforts with a monthly newsletter to our 16,000 English subscribers and social media presence to 140,000 followers across all platforms (Facebook. Twitter, Instagraml. With the backdrop of an ambitious brand and digital transformation programme, marketing has mostly continued with business as usual with the notable exception of creating a global content hLtrddle, a space facilitated by HI for Federation Content Creators to meet monthly, exchange ideas and collaborate on project5. With the goal of becoming a collective power house in the digital space throu8h shared amplification and tagging strategies. during 2024 we will launch 2 small user generated content Campaigns. These will be soft launches designed to nurture the ground with some key messages around Diversity, Equity, Inelusion, and Belonging IDEIBI and Travel Changing Lives of the Young, in advance of a new brand platform later in the year. TECHNOLOGY SERVICES 2023 has been an important year for HI on its transformation. We continued to work with trusted technology partners 934 and have developed our team with the introduction of a part-time digital project manager, and part-time digital marketing executive. In 2024, we are working mole closely with technology specialists across the network and moving toward a more agile approach to working which will allow us to access specialist resource, and test digital solutions iteratively as we develop a digital strategy aligned to our strategic objectives. We continue to collaborate with the Strategy Working Group (consisting of CEOS from several of our Member Associationsl and Discover Cloud, a technology partner of the Swiss Youth Hostels, to assess the viability of a digital ecosystem that will connect all Member Associations and refine the customer digital journey from a global perspective. The hihostels.com website tontinues to showcase h05tels across the IYHF network, inspire our travellers to explore the World, provide content on experiences and sustainable travel, and help travellers find their ideal destination hostel by optimising our search widget. The HI website sends member travellers directly to our Member Associations, own web51tes for booking but Still offers the opportunity for our
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) travellers to purchase IYHF membership directly from HI. Hostels are featured on the hihostels.com website with individual pages linking to the Mernber Association's website and booking engine, where available. This website is being reviewed for its ongoing effectiveness as part of the transformation programme and our 2025 strategy will be looking at the best way to modernise its function in keeping with our 5trategv. A HI global booking engine Proof of Concept is ndenaY with Australia and Finland Member Association5. This is the first part of our ambitious transformation programme and the concept has been well received by Member Associations as a good opportunity to diversify revenue streams and elevate the customer experience. GOVERNANCE AND ADMINISTRATION Board of Trustees Hoslelling International is a registered charity and company limited by guarantee with no share capital, managed by a Board of Trustees. The directors of the charitable company are its trustees for the purpose of charity law and throughout this report are collectively referred to as the trustees. The Board of Trustees is comprised of up to nine members elected from candidates proposed by HI'S Member Associations. Board members seNe 4-year terms on a staggered basis meaning that normally only half of the Board seats come up for re-election at each biennial International Conference. The President must stand for election at every International Conferenee. The following trustees served on the date this Annual Report was signed, or during the reporting period.. Name (Nationality) Posltlon Perlod of offlce Abdusalam El Elarabi Abuehmaera (Libyal Member Throughout Alan Bourne IUKI Treasurer Throughout Hussain Ali Alhababi (Qatarl Member Throughout Miguel Perestrello (Portugall Vice Presider¢t Throughout Nicole Sandoval IUSAI Member Throughout Sanni Viirto (Finlandl Member Throughout Sergio Montoya Ruiz De Angulo Ispainl Member Throughout Stephan Kurmann ISwit2erlandl President Througho Uwe Boehm (Germany Vice President Throughout Throughout 2023 and until the date of signing, the executive team was led by CEO Brianda Lopez.
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) Board of Trustees Selection Process Board members are usually current or former trtsstees or a CEO ol a Member Association and are required to be nominated to stand for election by either the Member Association of which they are an individual member or no less than ten other Member Associations. The Board may, but is not obliged to, rill any vacancies that arise. Elections are held at the biennial conference in accordance with our Memorandum and Articles of Assotiation and Rules of Procedure for Conference. Each Trustee may Serve up to 8 years- a maximum of 2 terms of four years each- on the Board and then up to an additional 6 years13 terms of 2 years each) as President. Trustee Induction and Trainlng In 2022. newly elected Trustees attended an indtjction session led by the HI President, Treasurer and CEO. Our accountant and Independent Examiner, MHA, also provided a short reminder session for all TrLtstees to outline their duties and responsibilities. Organlsatlonal and Board Evaluation The Charity continue5 to work towards complying as far as is prartical with the Charity Governance Code. At the beginnlnE of 2021 the Board undertook a comprehensive exercise to establish the extent to which HI was following the Code and where improvements were possible. The study confirmed that HI had made considerable progress over recent years with implementing good practice. The key areas which were highlighted as requiring further work were- finalising a new network strategic plan which better emphasised HI'S charitable purpose,. moderni5ing HI'S Board election process to improve its ability to attract trustees with the right skillslexpertise and diversity to lead the organisation effectively- and consolidating/establishing good communication channels with the Member Associattons. The trustees also undertook a self-asses5ment of how well the Board was fLtnctioning. This concluded that Ihe Board had become much better focused and more effective since the 2020 conference. The key issue raised was the poor diversity represented by Board membership, e.g. only one female trustee and a shortage of younger voices. This was improved by the 2022 elections and is also being addressed by a 'Diversity and Inclusivity, working group as part of the 'HI Aims, pioject. Other highlighted issues such as a lack of informal discussion and the length of meeting5 resulted from the move to holding most meetings by video-call. A follow up board evaluation will be conducted in 2025 $0 that progress can be monitored. Responsibilities of the Board of Trustees The role of the Board is governance rather than management. Governance focuses on the wider issues of the organisation and the establishment and monitoring of policy and strategic direction. The Board works closely in partnership wlth the Chief Executive Officer ICEOI to ensure that HI'S goals are achieved. The 8oard may require the CEO to propose new strategies or revise existing strategies for the Board's onsideration. Upon approval from the Board, the CEO develops implementation plans and takes the necessary steps to action them. The Boar¢J meets on a regular basls to examine progress reports and
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) supeNise performance. The Board gives direction for the overall operations of HI but 15 not directly responsible for the day-to- day operations of the organisation this is the task of the CEO. The Board, however. has the ultimate responsibility for the sound management and financial security of HI. The Board approves the annual budget prior to the beginning of every financial year and sets a delegation of authority regarding limits on expenditure, contract5 etc. Trustees. Indemnity Insurance The charitable company has purchased insurance for the trustees and officers of the charity against liability arising from Wfongful acts in relation to the charity. The cost of this insurance is not separately available. Key Management Personnel Remuneration The key management personnel of the charity comprise the Board of Trustees and the Chief Executive. The Trustees do not receive remuneration. The Chief Executive's remyneration is set by the Board and from tirne to time they take advice from external recruitment agencies regarding whether that muneration remains appropriate. The Board does not have a formal remuneration policy. The settin8 of the pay and conditions of the staff, other than for the CEO, is delegated to the CEO within the constraints of the annual budget and HR policv. Organlsatlonal Structure At the date of siEnin& HI has thirteen employees of which eight work part-time. This amounts to 9.9 full-time equivalents. At the head of the team is the CEO. All staff work remotely from home but meet virtualty at least once a week and are brought together for physical team meetings a few times a year. Risk Management HI'S Risk ManageTnent Policy highlights that risk, and its management, is a critical part of the daily operations of HI'S business. The Policy requires HI to identify and assess risks, maintain a risk register, and manage and review those risks as part of day-to-day operètions. The Board of Trustees are to undertake a full review of the Key Risk Register at least annuallv. The key risks for HI identified in May 2024 were.. Strategic Risk Inability to unify the Federation around the Nl Strategy and sustainable business model Insufficient resilience influence and limited capabilities of the IYHF Network to cope with current and future climate chan8e Failure to provide sufficient value to Member Associations and end customers. io
REPORT OF THE BOARD OF TRVSTEES (CONTINUED) Governance Risk Existin8 Governance arrangements of HI and/or its Member Associations restrict HI'S efftciency in making decisions on behalf of the organisation Operational Risk Cyber-attack or IT Failure at HI or critical third-party providers. Data risk lemergingl of future IYHF ecosystem and HI booking engine and membership sales portal Financial Risk Major disruption to international travel le.g. pandemic) or external environment outside HI'S control. The Board is actively looking at ways to mitigate the identified risks through the different strands of the emerging new network strategic plan and associated operational plans. Gratitude The Board would like to take this opportunity to express its thanks to all the volunteers and professionals involved in the international hostelling movement, both those who serve on Member Association Boards of Trustees and those who help with hostel activities. Without their support and asS1Stance, the work to deliver the mission of this global organisation could not take place. Particular thanks go to our Member, Hostelling International Norge whose staff carried out HI Qualitv and Sustainability audits following training provided by HI Staff. Two weeks of staff time was donated by Ftl Norge, the value of this time is estimated as £1,594. Flnance Total Incoming Resources in 2023 amounted to £633,14912022 £1,578,639), income In the prioryear included £941,342 in relation to the profit on the sale of the hostel in Lima, Peru. Leaving aside this one- off income from thè property sale. income decreased by £4.148 year on year. 56% of HI'S 2023 budgeted income153% in 20221 wa5 from membership fees. By the end of 2023, 92% of the 2022 fees and 90% of the 2023 fee5 had been paid. At the end of 2022, outstanding membership fees relating to all years amounted to £138.821 this mained at a similar level of £138.418 by the end of 2023. Total Resources Expended Ibefore gains and10sses on investments) amounted to £631,80712022 £629,150) representing an increase of 0.4% year on year. In 2023, no donations-in-kind were received from Google Grants Irepresentino free online advertising costs). compared to £1,132 received in 2022 Net gains on investment assets were £58,72012022 £83,711 lossl reflecting a welcomed year end recovery in the money markets. li
REPORT OF THE BOARD OF TRUSTEES (CONTINUED The 2023 net movement in funds was a £60,062 increase in reserve5 compared to an increase of £865,778 in 2022 (following the sale of a property in Lima). Hence HI'5 reserves increased from £1,499,409 to £1,559,471 during 2023. Fundraislng HI has not enEaged in any fundraising activities, or with any professional fund-raisers. The Charity is not registered with the Fundraising Regulator, did not recewe any complaints during the vear, and does not interact with vulnerable people through its fundr315ing activities. Investment Pollcy Following the sale of the Lima hostel in December 2022, the Board agreed that £800,000 of the proceeds that HI did not need access to in the short-term should be transferred to our investment managers, Brewin Dolphin. Later in the year, fees received from Member Associattons were placed on Short term fixed deposit5 Wlth HSBC, to take advantage of favourable interest rates. During 2023 HI neither passed surplus cash across to Brewin Dolphin nor needed to sell investments foi cash. As at the end of 2023, £1,353,85012022 £478,377) was invested with 62% held in equities169% in 20221. 17% in bonds114% in 20221, and 21% In a mix of other investment types117% in 20221- Hostelling International's investment policy seeks to maintain purchasing power and achieve long-term capital growth of UK inflation IRPII plu5 3% while operating with an average/moderate risk (Brewin Dolphin Category 61 tolerance. In accordance with our mission to build 3 more understanding. tolerant, peaceful. and environmentallv considerate world described on page 3, HI'S investment policy seeks to be culturally and ethically sensitive and as such Scen5 out investment in certain types of companies whose activities conflict with HI'S objects and the environmental principles of HI'S Sustainability Charter. This policy piecludes direct investment in companies that generate more than IO% of revenues from tobacco, alcohol, nuclear energy, pornography or armaments. The yield from dividends in 2023 amounted to £19,0051£10,578 in 20221. Reserves Policy The total funds of the charity at 31 December 2023 were £1,559,47112022 £1,499,409>. of which restricted funds amounted to £12,97512022 £12,8561. HI'5 Reserves Policy specifies both minimum and maximum levels of "free reseNes' which the organisation should aim to stay within. Free Reserves are defined as our unrestricted funds less tangible fixed assets. The lower threshold is set as being the annual operating expenditure- a level (leemed to be sufficient to withstand the occurrence of any of HI'S high-risk Scenarios as documented in it5 risk register. The worst-case financial modelling surrounding the effect5 of the pandemic undertaken at the beginning of 2021 gave us a benchmark. The upper threshold is set at twice the annual operating 12
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) expenditure and aims to Signal the point at which HI may be accumulatin8 reseryes unnecessarily and hence missing opwrtunities to deliver public benefit in accordance with its mission. Based on the 2023 budget, the polity sets our L¢pper reserves threshold at £1.3m and the lower threshold at £657k. At the 2023 year-end, our free reserve5 Stood at £1.5m and hence 16% above the upper threshold set by the reseNes policy. In 2024, the Board has approved expenditure of up to £IOO.000 to progres5 HI'S Brand and Digital Transformation Project and continues to VIeW opportunities that would bring HI'S resetves below the upper threshold. HI aims to set and athieve a balanced budget each year. We then rely on the capital growth of our investments over the medium to longer term to 8t least match inflation to maintain the real value of our reserves and thi5 was achieved in 2023. Going Concern In order to confirm that HI is a going concern, the Board has considered what could happen to its reserves if 'worst-case' scenarios were to materialise. HI'S risk register states our key financial risk is 'major disruption to international travel le.g. pandemic) or external environment outside HI'S control" Our recent experience of the Covid19 pandemic helpfully Eive5 us a benchmark for what could happen as well as pointing to what we might do differently in similar circumstances. However, the Board is mindful that such an event happenin8 so soon after Covid19 could play out differently particularly as the Member Associations on whom we depend on are, to varying degree5, Still ir5 recovery mode. In 2021 we received arourtd 75% of the fees due for that year despite most Member Associations havin8 limited trade durfjng the year. If this was to be repeated, we could Cover at least 40% of our core costs from received fees. leavin8 a shortfall of £350k to fund from reserves. With free reserve5 of at least £1.5m to cover for tjnpaid fees, this wovld be sufficient to cover budgeted costs for three years even if the value of investments fell by 25% las happened in 20201. In the extreme scenario of no income from members, we have sufficient resee$ to cover two years of expet)diture befo allowing for any short- term savings we might be able to make. The Trustees agreed that they are satisfied they have a reasonable expectation that the organisation has adequate resources to continue in operational existence for the foreseeable future and that the use of the going concern basis of accounting is appropriate in preparing the annual financial statements. The trustees do not consider liquidity to be a material financial risk as the charitable company has sufficient funds. represented by accessible fixed term cash deposits, or investments managed by Brewin Dolphin that can be made available to HI with one week's written notite should reteived income from members be substanttally lower than expected. Accordingly, the Charity is not aware of any material uncertaintie5 that exist over its ability to continue a5 a going concern. Plans for the Future The Board believes HI'S mission and values are more relevant than ever considering the increasing threat of climate change, political and ideological divisions around the world, and declining mental health among youth. HI is uniquely placed to SL¢PPOrt on these issues by connecting local communities, 13
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) young people and youth orBanisatior15. and implementing the Sustainable Development Goals. This emphasises the need to work towards a new strategy and adapt it to the new cÈrcumstances in order to protert HI and its network and ensure a bright future for hostelling. In the meantime, HI continues to progress pillars of the 5-year transition strategy that was presented at Conference 2022 by the Strategy Working Group. StrateEiC projerts and artions undertaken by the HI office, Board and Member Associations have collectively in 2023. and continuing in 2024. contributed to one of the following three pillars.. Recovery & Renewal This strategic area presents a set of priorities designed to help Member Associations and the HI office collaborate to recover faster from the COVID-19 pandemic and position the federation to strengthen its role in the travel sector and the delivery our mission in ways valued by young people, particularly 18 to 30-year-olds seeking to travel. Brand th a Social Mission IPurposeful Brand) This strategic a0 presents a set of priorities designed to harness the true potential of the HI brand and showcase a strong brand with a recognized social mission that appeals to young people, whi15t remaining 'open to all,. Organisational Services that Increase Hl's Social Impact This strategic area establishes the priorities for services offered within the HI federation that support the ability to deliver its mission and achieve a measurable social impart. It includes services that enable HI to operate as a charitable organization, and optional services that involve additional fees or commissions to cover their costs. This strateby and this new HI. aim to do things in a different way together with our members. The key drivers that will be necessary to ensure successful delThiery of the strategy and a stronger organisation are, amongst others. collaboration, digital transformation, innovation, a focu5 on young people and a customer centric approach In 2023, the Strategy WG met regularly to advance on the key strategic areas and made good progress, especially, regarding Digitalisation and Brand. 14
REPORT OF THE BOARD OF TRUSTEES (CONTINUED) The strategy is complemented by a number of Board Projects that are being progressed by Working Groups led by Boord members, as follows: HI Aims.. Under the HI values, this project focuses to advance and provide clar¢fication and understanding around Diversity, Equity, Inclusion and Belonging IDEIBI and to create a pcslicy and key targets in this area. Thi5 includes progressing the objective of launching a Youth Panel. Federation Expansion and Membership Concept- A project to look at ways to explore how to expand our Federation both geographically and through our membership categories. This projert also aims to identify and identify a new structure for membership fees and voting rights. l Registered Office- A project to address a Conference motion to investigate the benefits and disadvantages surrounding moving the registered address of Hostelling International from the United Kingdom into the European Union and to report its conclusions to the Member Associations by the 2024 conference at the latest. HI Conference Criteria: A project focused on delivering a fair and transparent proce55 and criteria to SUPPOrt the Board of HI selecting future venues for international conferences. Modernisins Governance- Identifying changes to HI'S governance document5 aimed at streamlining the organisation's Strategic decision making processes. The strategy will help HI and the network to evolve and strengthen together as a federation, in an innovative and collaborative way. Within the Strate there are projects that will be key to the future of HI such as a new Web Service proposal where digitalisation will play a key role within our federation to achieve our goals and fulfil the mission. Other key project5 are modernising our governance model, enhance our programmes and work towards SDGS. We continue the journey that will help HI navigate the unpredictable, whilst laying the foundations for a stronger, more relevant, inspirational orBanisation. The Rekk)rt of the Board of Trustees was approved and signed on behalf of the Board by Stephan Kurmann President 22 07 2024 Alan Bourne Treasurer 22 07 2024 15
TRUSTEES, RESPONSIBILITIES STATEMENT The trustee5 (who are also direttors of International Youth Hostel Federation for the purposes of company lawl are responsible for preparing the Trustees, Annual Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards Iunited Kingdom Generallv Accepted Accounting Practice) including FRS 102 "The Financial ReportinE Standard applicable in the UK and Republic of Ireland. Company law requires the trustees to prepare financial statements for each financial year which give 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 these financial statements, the trustees are required to.. select su¢table accounting policie5 and then apply them consistentlv- obse¢we the methods and principles in the Charities SORP (Statement of Recommended Practice),. make judgments and estimates that a reasonable and prudent- state whether applicable UK Accounting Standards have been followed- and prepare the financial statements on the going toncern basis unles5 it is inappropriate to presurne that the charitable company will continue in business. The trustees are responsible for keeping adeqvate accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statement5 comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdirtions. 16
INDEPENDENT EXAMINER'S REPORT TO THE MEMBERS OF INTERNATIONAL YOUTH HOSTEL FEDERATION Independent Examlner's Report to the Trustees of INTERNATIONAL YOUTH HOSTEL FEDERATION I'the Charity'l I report to the charity Trustees on my examination of the a¢¢ounts of the Charity for the year ended 31 December 2023. Responsibilities and Basis of Report As the Trustees of the company land also its directors for the purposes of company lawl, you are responsible for the preparation of the accounts in accordance with the requirements of the Companies Act 20061'the 2006 Act'l. Having satisfied myself that the accounts of the company are not required to be audited under Part 16 of the 2006 Act and are eligible for Independent Examination, I report in respect of my examtnation of the Charity's accounts carried out under section 145 of the Charities Act 20111, the 2011 Act'l and in carrying out my examination, I have followed the applicable Directions given by the Charity Commission under section 14515llbl of the 2011 Act. Independent Examiner's Ststement Since your charity's gross income exceeded £250,000 your examiner must be a member of body listed in section 145 of the 2011 Art. I can confirm that l am qualified to undertake the examination because l am o member of the Institute of Chartered Accountants in England and Wales, which is one of the listed bodies. I have completed my examination. I confirm that no matters have come to my attention in connects'on with the examination giving me cause to believe that in any material respect.. accounts.ng records were not kept irs respect of the Company as reouired by Section 386 of the 2006 Act,. or the accounts do not accord with those records,. or the accounts do not comply with the accountin8 requirements of Section 396 of the 2006 Act other than the requiremet)t that the accounts give a true and fair view which is not a matter considered as part of an Independent Examination,. or the accounts have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for accounting and reporting by charities (applicable to charitie5 preparing their accounts in accordance with the Financial Reporhng Standard applicable in the UK and the Republic of Ireland IFRS 10211. 17
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF INTERNATIONAL YOUTH HOSTEL FEDERATION (CONTINUED) I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached. Si8ned.. Dated- Ja171ay- Rachel Doyle ACA FCCA DChA MHA Chartered Accountants MHA House Charter Court Swansea Enterprise Park Swansea SA7 9FS MHA is the trading name of Maclntyre Huilson LLP, a limited Itability partnership in Englaftil and Wales (Tegistered number OC3123131. 18
FINANCIAL STATEMENTS STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2023 (INCLUDING THE INCOME & EXPENDITURE ACCOUNTI (Note 211 Totsl Funds 2022 Uniestrlcted Funds 2023 Restrlcted Funds 2023 Total Fund5 2023 Note INCOME FROM: Donations 1,171 119 1,290 6.242 Grants received Charitable activities 598.577 2,382 30.900 598,577 2,382 30.900 615,993 4,382 10.582 Other tradin8 activitie5 Investment income Other income 98 Profit OD Sale of Property Total Income io 941.342 633,030 119 633,149 1,578,639 EXPENDITURE ON: Raising funds Investment m8na8ement costs Charitable activities 805 805 2,023 2,211 7.983 7.983 Network & Brand 443,897 179,122 443,897 179.122 439.996 Web Service5 184.920 Total Resources E¥pended 631,807 631.807 629,150 Net income before investment gains I Ilossesl 1,223 119 1,342 949,489 Net gains / Ilossesl on investment assets 58,720 58.720 183.7111 NEY MOVEMENT IN FUNDS 59,943 119 60.062 865,778 Total funds brought fotward Total funds carried forward 14. 15 14, 15 1,486,553 1.546,496 12,856 12.975 1,499,409 1.559.471 633,631 1,499,409 All operations are classed as £ontinuin8. The notes on pages 22 to 33 form part of these financial statements. 19
BALANCE SHEET AS AT 31 DECEMBER 2023 Note 2023 2022 FIXED ASSETS Tangible fixed asset5 Investments io 21.440 1.353.850 1,375,290 40.822 478,377 519,199 Total Fixed Assets CURRENT ASSETS Stock Debtors Cash held for investment Cash at bank and in hand 2,363 73.322 15,231 197,083 287,999 3.169 85,792 11,095 1,143.59S 1,243,651 li 12 12 Total Current Assets CREDITORS: Amount5 falling due within one year 13 103,818 263.441 NET CURRENT ASSETS 184,181 980,210 TOTAL ASSETS LESS CURRENT LIABILITIES 1,559,471 1,499,409 TOTAL NET ASSETS 1,559,471 1,499,409 THE FUNDS OF THE CHARITY Unrestricted funds General fund Restricted htnds 14 1.546.496 12.975 1,486,553 12.856 14 1,559,471 1.499.409 The accompanying accounting policies and notes form an integral part of these financial statements. For the year ended 31 December 2023, the company was entitled to exemption under section 249alll of the Companies Act 1985. No members have required the company to obtain an audit tsf its accounts for the ye3r in question in accordance wilh section 249bl21. The members acknowledge their responsibility for.. lil Ensurin8 the company keeps accounts records which comply with section 221. and lill Preparing accounts which give a true and fair view of the state of affairs of the company as at the end of its profit and loss for the financi31 year in accordante with section 226. and which otherwise comply with the requÉrements of the Cornpanies Act relating to accounts so far as applicable to the company. Approved and authorised for Issue on behalf of the Board of Hostelllng Internatlonal (Company number., 022507061 by Stephan Kurmann. President Alan 8ourne, Treasurer Approved by the Board of Trustees on Monday 22 July 2024 20
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2023 2023 2022 Net cash flows from operating activities 1152,3101 128,717 Cash flows from investing activltles: Investment income received Proceeds from sales of fixed assets Purchase of property, plant and equipment Proceeds frorn sale of inv8strnent5 Purchase of investments Net cash flows from investin8 actlvltles 30,900 10.582 957,141 146.1661 119,011 1143.4971 897,071 14,2131 525,153 11,341,906) 1790.0661 Net Increase I Idecreasel In cash and cash equlvalents 1942,3761 1,025,788 Cash and cash equivalents at beginnlng of year 1,154.690 128,902 Cash and cash equivalents at the end of the year 212.314 1,154,690 Being: Cash held for investment Cash at bank and in hand 15,231 197,083 212,314 11,095 1,143.595 1,154,690 Reconciliation of net expenditure to net cash flow from operating activities 2023 2022 Net Èxpenditure as per the statement of financial activities 60,062 865.778 Adjustments for.. Depreciation charge5 IGainl on di5ptss31 of fixed assets Losses / Igainsl on investments Dividends, interest and rents from investments Decrease in stocks Decrease / lincreasel in debtors Increase / Ide¢reasel in Creditors IDecreasel l increase in provisions 23,595 9.824 1941,4401 83.711 110,5821 2,023 132.955 67,448 181.0001 158.7201 130,9001 806 12,470 1159,6231 Net cash flows from operatlng actfvitle$ 1152,3101 128.717 The Charity did not have any net debt at eiiher the current or prior year end and as such is not disclosing an analysls of movements In net debt table. 21
NOTES TO THE FINANCIAL STATEMENTS I. PRINCIPAL ACCOUNTING POUCIES Hostelling International. a public benefit entity, is registered in England & Wales as a private company limited by guarantee, not having shale capital. The charity is a registered charity. The registefed office is gsven on page 34. al Financial Statements The financial statements are prepared under the historical cost convention, in accordance wlth the Statement of Recommended Practice -Accounting and Reporting by Charities ISORPI- applicable lo charities preparing their accounts in accordènce with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021, as updated, effective from l January 2019, the Charitles Aci 2011,. and the Cornpanies Act 2006. The principal accounting policie5 are Set out below and remain consistent under the new framework from the previous year. Hgstelling International has a wholly owned subsidiary. Hostelling Intematiofial Trading Limited, which has remained dormant since its incorporation and as such the accounts have not been prepared on consolidated basis. The financial statements have been presented Sterling and all figure5 have been rounded to the nearest pound. bl Going concern These finanual statements have been prepared on the 8oin8 concern basis. The Trustee5 have performed a robust analy515 of forecast future cash flows for the period up to the end of December 202S. which the Trustees consider to be the realistic foreseeable future, taking into atcount the potentlal Impact on the business of possible futuie scenarios. This analysi5 also considered the effectivenes5 of vailable measures to a551St in rnitigating the impact. Based on these assessments and realistic worst-case stenari95 and having regard to the liquid resources avallable to the entity, the TTustee5 have concluded that there is no materi41 uncertainty and that they can continue to adopt the going concern basis in preparing the annual report and accounts. Further details of this a55e5srllent can be found on page 13 of the Trustees report. cl Fixèd A55ets Fixed assets are stated at cost less any impairment. Depreciation is calculated by reference to the cost or valuation tsf fixèd 35sets at rates constdered appropriate, having regard to the expected lives of the fixed assets. Website developmènt costs in ex¢e5s of £500 are capitalised at cost and depreciated in equal annual in5talments over 2 years. Freehold buildings are depreciated in equal annual instalments over 40 years from the date of acquisitlon. Prior to the implementation of FRS 102, the Company had revalued the Peru property to its open market value. Under tran51tional rules of FRS 102. the Company has retained this previously revalued book amount. Leasehold improvements are depreciated in equal annual instalments over 3 years and are fully depreciated. Office equipment costing more than £500 is capitalised at cost and depreciated in equal annual instalrnent5 over 4 years. dl Stocks Stock5 are valued at the lower of cost 01 net realisable value. 22
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) I. PRINCIPAL ACCOUNTING POLICIES (CONTINUED) el Foreign Currencies Assets and liabslities denominated in ftsreign turrencies are translated at the rate of exchange ruling at the balance sheet date. Income and expenditure in forei8n currencies are recorded at the exchange rate ruling at the date of the transaction. Pension Costs The charitable company'5 contributions to employees, defined contribution schemes are har8ed to the Statement of Financial Activity for the year in which they are payable to the scheme. gl Fund Accounting Funds are accounted for as follows: Restricted funds are used for specific purposes laid down by the donor. Expenditure for these purposes Is Charged to the fund. Unrestricted funds are other incoming resources received or generated for expenditure on the general objectives of the charitable companv. Designated funds are unrestricted funds whlch have been designated for speclfic purposes by the trustees. h) Myclimate funding As part of HI'S sustainability activities, part Of the voluntary donation received to oftset the Carbon footprint of the traveller is paid over diiectly to myclimate who invest in sustainability projects. Both incorne and expense are recognised in respect of this transaction. il Investmènts Investment5 are reco8nised initially at fair value which is normally the transaction piice excluding transaction costs. Subsequently. they are continuously measured at fairvalue with changes recognised in 'net gains / Ilossesl on investments, in the statement of Financial Activltles, if the shares are publicly traded or their fair value can otherwise be measured reliably. As investment5 are continuouslv revalued there are no realised gains or losse5 recorded. Investment income is accounted foi in the period in which the charitable company is entitled to receipt. Cash held within the investment fund is considered for available use and is included within tash. The investmènt in the subsldiary is held at cost. jl Pro8ramme Related Investments loans are made at arm's length to Member SOCIatIOnS to support key hostel projects. Interest is charged at commerci31 rates and recognised as income when received. kl Resources Expended Resources expended, including termination payments, are accounted for on an a¢¢ruals basls. Expenditure 15 apportioned to activity cate8ories. based on headcount. In 2020, HI rebranded its activities under two umbrella headings.. Network and Brand, and Web Services. to better reflect the key focus areas for the restructured organisations. 11 Resource5 are allocated between= Expenditure on 5UPPOrtin8 Member A550Clations in their delivery of the mission Expenditure on maintaining and developing our Web Services, includin8 hihostels.com, digital membership and affiliate products for Mernber Associations Expenditure incurred in the Eovernance, management and administration of the charity is Ilocated tts the èbove categories on a per capita ba5is1see Note 41. No such costs are currently allocated to grants or raising funds on the grounds of materiality. Gcsvernance expenditure includes costs assoclated with Board of Trustees, Meetings, Officers, Meetings, biennial international conference, annual report and independent examination. 23
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) I. PRINCIPAL ACCOUNTING POLICIES (CONTINUED) ml Income Income from donatlons includes.. Voluntary donations to the HI Sustainabllity and Myclimate funds at the time of bookin& which are recogni5ed when the booking is made oiher donations and legacies, which are recognlsed when It Is probable ihat the income will be received Income from charitable activities includes.. Membership fees and conference fees from Member A550ciations. which is accounted for on a receivable basis Revenue from the hihoste15.com website (deposits in respect of bookings, booking fees and cornmissions on the sale of emembershipsl, which is recognised when the booking is made. Income from other trading activities includes sales of welcome stamps and other merchandise to Member Association5, which is accounted for on a receivable basis. Income from investments is lecognised when receivable. n) Leases Lea5e5 are classified as finance leases whenever the terms of the lease transfer substantially all risks and rewards of ownership of the leased asset to the group. All other leases are cla551fied a5 operating leases. A5set5 held under finance leases are recognised initièlly at the fair value of the leased a55et lor, If lower. the present value of minimum lease payments) at the inception of the lease. The corresponding liability to the lessor is included in the statement of financial position as a finan lease obligation. Lease payments are apportioned between fifian charges and redurtion of the lease obligation on a 5traight-line basis as therè 15 an irnmaterial difference to Using the effective interest method Iwhlch achieves a constant rate ol interest on the remainine balance of the liabi1ityl. Finance charges are deducted in measuring income and expenditure. A%5et5 held under finance lease5 are included in tangible fixed assets and depreciated and assessed for impairment losses in the same way as owned assets. Payments made under operating lease5 are recognised in the Statement of Financial Activities on straight line basis over the term of the lease. 24
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) I. PRINCIPAL ACCOUNTING POLICIES (CONTINUED ol Provisions Provisions for future expenditure to return leased property to the same condition as it was at the start ol the lease at the expiry of the property lease. as required by the terms of the lease. are made using benchmark figufes from the Royal Institute of Chartered Surveyors to reach a reasonable estimate. pl Taxation As a registeled charity. Hostelling International is exernpt from taxation on it5 income and 8ain5 fallin@ due within pèrt 11 of the Corporation Taxation Act 2010 and s256 Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable purposes. No tax charge has arisen in the year ended 31 December 2023. ql Grants Grant5 payable from the Sustainability Fund are recognised in the Statement of Financial Activities when awarded and communicated to the recipient. rl Fin3ncial instruments The Charity only hold5 basic Financial Instruments. The finanoal assets and financial liabilities of the Charity are as follows.. Debtors- tTade and other debtors lincluding accrued income) are financial instruments and are debt instruments measured at amortised cost as detailed in note 11. Prepayments are not finantial instruments. Ct75h ot bank- is classified as a baslc financial instrument and is measured at face value. Liabilities- trade creditors. accruals and other creditors are classified as financial instruments, ènd are measured at amortised cost as detailèd in note 13. Taxation and social security are not included in the financial instrument5 di5£195ure. Deferred income is not deemed to be a financial liability, a5 in the cash settlement has already taken place and there is simply an obligation to deliver services rather than cash or another financial instrument. sl Crltical accountlng judgements and key sources of estimation untertalnty In the application of the charitable company's accounting policies described above the Trustee5 are required to make judgements, estimates and a$5umptions about the carrying amounts of assets and liabilities that are not readily apparent from other Sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumpt*ons are reviewed on an ongoing basis. Revisions to accounting estimate5 are recognlsed in the perlod in which the estlmate is revised if the revlsion affecis only that period. or in the pèriod of the revision and future period5 if the revision affects bgth current and futyre periods. The Trustees are not aware of any critical judgements or source5 of estimation uncertainty requiring disclosure beyond the accounting policies listed above. tl Donated professional serv15 are recognised as income when the charity has control over the item. any conditions associated with the donated itern have beÈn met, the Tecelpt of economic benèfit from the use by the charity of the itern is probable and that economic benefit can be measured reliably. In accordance with the Charities SORP IFRS 1021. general volunteer time is not recognised. On receipt. donated professional servSces are recognised on the basis of the value of the Bift to the charity which is the amount the ¢harTrty would have been willing to pay to obtain service5 of equivalent economic benefit on the open market,. a coriesponding amount is then recognised in expenditure in the peiiod ol receipt. 25
NOTES TO THE FINANCIAL STATEMENTS {CONTINUED) 2. INVESTMENT INCOME 2023 2022 Dividends on listed equitie5 Interest on listed securities Interest on other interest-bearing account5 19.005 9.IS6 2,739 30,900 7.594 2.985 10,582 3. INCOMING RESOURCES FROM CHARITABLE AcfiviTIES 2023 2022 Membership Fees Booking Revenue Other fees from members Other income 340.841 358,563 54,900 199,232 3,298 615.993 251,990 5,746 598.577 Attributable to 8eographical markets Outside the UK 526,509 554,861 4. RESOURCES EXPENDED- CHARITABLE ACTIVITIES & SUPPORT COSTS 2023 2022 Dirert Costs Support Costs Olrect Support Costs Total Costs Total Network & Brand fjiants awarded Staff costs Fècilities & equipment Professional services Travel & subsistence Depreciatiort Other Total Network & Brand 463 149.770 53 463 169,018 58 142,067 7,721 14,368 12,967 839 40,241 218.203 311,085 7.779 14.368 31,054 839 78,772 443,897 129,412 13,8471 30.449 8.250 8,130 27.366 199,760 279,182 13,7941 36,631 72,904 8.130 46,480 439,996 6,182 64.654 18.087 38,531 19.114 240,236 225,694 Web Seryice5 Staff costs Facilities and equlpment Professional serwices Travel and subsistence Depreciation Other Total Web Service5 80.211 38,477 2.091 3,891 3.512 227 10.899 59.097 118.688 2,091 3,945 4,247 22.756 27,395 179.122 70.908 26,961 18021 6,343 1,719 1.694 5,701 41.616 97,869 18021 6,343 1,792 1,694 78,024 184,920 S4 735 22,529 16,496 120,025 73 72.323 143.304 Totsl expenditure on charitable activit5 345,719 277,300 623.019 383,540 241,376 624,916 2022= The negative 'Facilitie5 and equipment" costs arlse due to the refund received of Business Rates for the year 10 31 March 2022. 26
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 4. RESOURCES EXPENDED- CHARITABLE ACTIVITIES & SUPPORT COSTS {CONTINUEDI Analysls of Support Costs 2023 2022 Network & 8rand Web Netwok* & Brand Web Ser¥lces Services Total Totsl Governance Managernent Finance, IT. HR Facilities costs 10,147 69.071 135,012 3,973 218.203 2.748 18.707 36,566 1,076 59,097 12,895 87,778 171.578 5,049 277,3tKI 16,832 70,084 117,279 14,4351 199,760 3,507 14,601 24,432 19241 41,616 20,339 84,685 141.711 15,3S91 241,376 Support costs are allocated pro rata on the basis of full-tlme equlvalent headcount. 5. STAFF COSTS 2023 2022 Gros5 Salaries Social security costs Terminatlon costs 367.495 30,276 318.700 28,282 Pension costs 23,278 421.049 22,301 369,283 Health costs Other costs associated with employees 5,138 3,586 429.773 4,655 3,113 377,051 In 2022 and 2023 no Termination costs were incurred. No. In 2023 No. In 2022 Employees whose emoluments were between: £60,000- £70,0(10 Contributions paid by Hostelling Internatlonal into employees, Èndivldual pènsion schemes for the employees whose emolument5 were above £60,000 amounted lo £4,67612022'. £4,326). The key management personnel of the charity cornprise the Trustees and the Chief Executive. The Trustee5 do not receive remuneration. The Chief Executive's remuneration is set by the Tiustees and from time to time they take advice from external recruitment agencies. In 2023 the total rernuneration for the Chief ExeEutive durÈng the year was £79,77612022.' £74,095). 27
NOTES TO THE FINANCIAL STATEMENTS {CONTINUED) 5. STAFF COSTS {CONTINUEDI The number of employees durlng the year, analysed by function, was: No. In 2023 No. In 2022 Full Time Equivalent Full Time Equivalent Average No. Average No. Network & Brand Web Services Support Costs including management li io 6. TOTAL EXPENDITURE included: 2023 2022 Depreciation Fees payable to the company's auditor.. For the audit of the company'5 annual accounts Under accrual for 2021 audit services Independent Exarninaiion Rentals under Operating lease5 Foreign exchange losses Cost ofstock recognised as an expense 23,595 9.824 17,500 750 4,250 19,159 2,562 2,023 8,244 806 7. TRUSTEES, EXPENSES The trustees who served during the year are shown on page 8. No trustee received remuneration durin8 2023 12022- Nil). Travel and other expenses reimbursed to the trustees during the year amounted to £6.75612022 £2,089). In 2023. 6 trustees received reimbursed expenses12022.. 41. 8. LEASING COMMITMENTS HI relinquished its leased office at the end of March 2022 meaning its operating lease commitments ceased to exist on 31 March 2022. 9. INVESTMENTS 2023 2022 Securitie5 Fair value at I january Acquisition5 at cost Disposals at carrying value Net Ilosse5118ain5 in the year Fair value at 31 Oecember 478.376 1,341,906 1525,1531 58.720 1,353,849 537,601 143.497 1119,0111 183,7111 478.376 Investment in Subsidlary Share in wholly owned subsidiary lat costl (note 161 Total Investments 1.353,850 478,377 28
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 9. INVESTMENTS (CONTINUED) Analysis of investments by type 2023 2022 8onds Equit*es Other Investments Investment in subsidiary 236,549 925,915 191.385 65,581 332,218 80.577 1,353,850 478,377 The value of securities shown in the Balance Sheet is the market value at 31 Dember 2023. The historical costs are shown below.. 2023 2022 Historical cost at 31 December 1,297,065 484,385 10. TANGIBLE FIXED ASSETS Website Development Costs Freehold Land and Buildin Leasehold rovements Offlce Total Cosl or valuation At l January 2023 Additions Disposals 45.058 10,163 4,213 55,221 4,213 At 31 December 2023 45.058 14,376 59.434 De tia lon At l January 2023 Provided for in year Di5P05a15 5,546 22.529 8,853 1.066 14.399 23,595 At 31 Oecember 2023 28.075 9,919 37,994 Net Book Value At 31 December 2023 16.983 4,457 21,440 At 31 December 2022 39,512 1,310 40,822 Development costs of the new hihostels.com website that were capitsli5ed in 2022, are being depreciated over a 2 year period. 29
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 11. DEBTORS 2023 2022 Member Associations Other debtors Prepayments and accrued Income 46,397 7.936 18,989 73.322 54.008 12,249 19,535 85,792 12. CASH AT BANK AND IN HAND 2023 2022 Cash held for investment 15.231 11,095 2023 2022 Current accoonts 196,531 552 1.143,020 575 Petty cash 197,083 1,143.595 13. CREDITORS: AMOUNTS FAWNG DUE WITHIN ONE YEAR 2023 2022 Member Associations Trade creditors Amounts owed to 5ub5idiary underlakings Other taxes and social security Other creditors and atcruals Grant award creditor 30,249 16,009 31.882 55,326 7.035 37,250 13.274 103,818 14.496 148,462 13.274 263,441 Included in Other creditors and accruals is a balance of £nil12022= £2.6641 relating to C02 offset donations received, under an agreement wlth Myclimate. Donations of £2,664 weie paid to My¢limate during the year 12022 £nill. The grant award creditor relates to grants awarded but not yet paid from the HI Sustainability restrlcted fund. Grants are pald on the completion of the project. Further details are shown below. 2023 2022 Grant5 awarded In 2015.. HI l¢eland 7,000 7,OLX) Grants awaTded in 2019: YHA Israel 3.085 3,085 Grants awarded in 2020.. Hostelling International- Canada Hih05te15 Brasil 2,126 1,063 13.274 2,126 1,063 13,274 30
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 14. FUNDS Restricted Funds 2023 General Fund Total Funds Balance at 31 December 2022 Incoming resour5 Expenditure Net losses on investment aS5et5 8alance at 31 December 2023 1,486,553 633,030 1631,8071 58,720 1.546.496 12,856 119 1,499.409 633,149 1631,8071 58,720 1.559,471 12.856 Restrlcted 2022 General Fund Funds Total Funds Balance at 31 December 2021 621,754 1,620,191 1671.681 183.7111 1,486.553 11,877 1,442 14631 633,631 1,621,633 1672.1441 183,7111 1,499,409 Incoming resources Expendituie Net gains on investment assets Balance at 31 Oecember 2022 12.856 In 2012. Hostelling International launched the Sustainability Fund on hihostels.com to enable HI customers to make a donation to offset the C02 of their overnight stay. Part of the donated Bmount is passed to Myclimate for carbon offsetting projects. The other part of the donation is held within a restricted fund by HI to be expended as grants to Member Associations to support their sustainable projects. Mo grants were paid during the year12022'. Grants totallin8 £1,063 were paid related to grant awards in 20201. See note 13. 15. ANALYSIS OF ASSETS BETWEEN FUNDS Unrestrlcted General 2023 Restricted Total funds Tangible fixed assets Investments 21.440 1,353.850 287.999 1116,7931 1,546.496 21,440 1.353.850 287,999 1103,8181 1,559.471 Current assets Current liabilitie5 Total net assets 12,975 12.975 Unrestricted 2022 General Restritted Total funds Tangible fixed assets Investments 40,822 478,377 1,243,651 1276,2971 1.486,553 40,822 478.377 1.243,651 1263,4411 1.499.409 Curreni assets Current liabilities Total net assets 12,856 12,856 31
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 16. RELATED CHARITIES International Youth Hostel Federation The directors consider that the International Youth Hostel Federation, an unincorporated charity registered with the Charity Cofflmission for England and Wales Inumber 3060381. is a related charity by vlrtue of the fact that both charitie5 have the same trustees. IYHF Is dormaftt wlth no tfansa¢tions during the year12022- Nill. Hostelling International Trading Limited Hostelling International Trading Limited Icompany number 090195641 was registered and incorporated in the UK on 30, Aprll 2014 and 15 a wholly owned subsidiary of Hostelling International. Hostelling International Trading Limited ha5 been dormant since Incorporation. The registered office 1$ 7 Bell Yard, London, WC2A 2JR. 17. LEGAL STATUS The charity is limited by guarantee and has no share capltèl. Each rnemberfs liability is limited to £1. 18. RELATED PARTY TRANSAcfioNS Other than the transactions detailed in notes 5, 7 and 16 above. there were no related party tiansactions in either year. Transactions with Mernber Associations that have representatives on the HI Board do not represent related party transactions. 32
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) 19. STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2022 (INCLUDING THE INCOME & EXPENDITURE ACCOUNTI Unrestrlcted Funds Restrlcted Funds 2022 Total Funds ote 2022 2022 INCOME FROM- Donations 4,800 1,442 6,242 Grant5 received Charitable ac¢ivities 615.993 4,382 615,993 4,382 10.582 Other trading actlvities Investment income 10.582 98 Other income 98 Profit on Sale of Propertv Total Income io 941.342 941,342 1,577,197 1.442 1,578,639 EXPENDITURE ON.. Raisin8 funds Investment management costs Charitable activities 2.023 2.211 2,023 2,211 Network & Brand 439,533 184,920 628.687 463 439,996 184.920 Web Service5 Total Resources Expended 463 629,150 Met incomellexpenditurel before investment gains /1105se51 948,510 979 949,489 Net Ilossesl/Bains on investment assets 183.7111 183,7111 NET MOVEMENTIN FUNDS 864,799 979 865.778 Total fund5 brought forward at l January 2022 Total funds carried fofward at 31 December 2022 14, 15 14, 15 621.754 1,486,553 11.877 12.856 633,631 1.499,409 33
REGISTERED OFFICE AND PROFESSIONAL ADVISORS Registered Office 7 Bell Yard London WC2A 2JR Bankers: HSBC Howardsgate Welwyn Garden City Herts AL8 68H Independent Examiners: MHA MHA House, Charter Court Phoenix Way Swansea Enterprise Park Swansea SA79FS Investment Bankers: Brewin Dolphin 12 Smithfield Street London ECIA 9BD Solicitors: Russell-cooke LLP 2 Putney Hill London SW15 6AB Trademarks: Mijrgitroyd Arena Point Merrion Way Leeds LS2 BPA VAT: Constable VAT Consultancy 12 Dedham Vale Busines5 Centre Manningtree Road Essex C07 6BL 34
MEMBER ASSOCIATIONS COUNTRY ALGERIA AUSTRALIA AUSTRIA AUSTRIA BAHRAIN BELGIUM BELGIUM BOLIVIA BOSNIA & HERZEGOVINA BRAZIL CANADA CHILE CHINA CHINESE TAIPEI CROATIA CZECH REPUBLIC DENMARK EGYPT ENGLAND & WALES FINLAND FRANCE ASSOCIATION Federation Algérienne des Auberges de Jeunesse YHA Australia OsterreichischerJugendherbergsverbat)d Hauptverband IOJHVI Osterreichisches Ju endherbergswerk IOJHWI Bahrain Youth Hostels Society Les Auberges de Jeunesse (L) Vlaamse Jeugdherbergen vzw IVJHI Hostelling International Bolivia Youth Hostel Association of Bosnia and Herzegovina HI Hostel Brasil Hostelling International- Canada Asociacion Chilena de Albergues Turi5ticos Juveniles YHA China Chinese Taipei Youth Hostel A550ciation Hrvatski Ferijalni i Hostelski Savez (Croatian YHAI Czech Youth Hostel Association ICZYHAI DANHOSTEL Egyptian Youth Hostels Association YHA England & Wales Suomen Hostellijarjesto- HI Finland Féderation Unie des Auberges de Jeune55e IFUAJI DJH Hauptverband HonE Kong Youth Hostels Association HI Iceland Youth Hostels Association of India Hostelling Ir)ternational-Northern Ireland An Oi8e Ilrish YoL¢th Hostel Association) Israel Youth Hostels Association Associazione Italiana Alberghi per la Gioventu IAIGI (Until May 20241 Japan Youth Hostels Inc Jordan Youth Hostels Commission Hostelling International Korea Kuwait Youth Hostel Committee Lebanese Youth H05tels Federation Libyan Youth Hostel A5SOClation Centrale des Auberges de Jeunesse Luxembourgeoises HI Malaysia NSTS Hostelling International Féderation Royale Marocaine des Auberges de Jeunes Stayokay YHA New Zealand Norske Vandrerhjem- HI Norway Pakistan Youth Hostels Association Youth and Student Hostel Foundation of the Philippines Polskie Towarzystwo Schronisk Mlodzie20 ch IPolish YHAI GERMANY HONG KONG ICELAND INDIA IRELANO (Northernl IRELAND (Rep of) ISRAEL ITALY JAPAN JORDAN KOREA Isouthl KUWAIT LEBANON LIBYA LUXEMBOURG MALAYSIA MALTA MOROCCO NETHERLANDS NEW ZEALAND NORWAY PAKISTAN PHILIPPINES POLAND 35
MEMBER ASSOCIATIONS (CONTINUED) COUNTRY PORTUGAL ASSOCIATION MOVIJOVEM Imobilidade Juvenil Cooperativa de interesse Publico e Respon5abilidade Lda.) Qatar Youth Hostels Association Romanian Hostellin Association for Hiking and Youth Hostels Saudi Arabian Youth Hostels Association SYHA Hostelling Scotland Ferijalni i Hostelski savez Srbije (Youth Hostels Association of Serbial Popotnisko zdrulenje Slovenije (Hostelling International Slovenial Red Espanola de Alber8ues Juvenile5 IREhJl Sudanese Youth Hostels Association Sven5ka Turistforeningen (Until September 20221 Schweizer Jugendherbergen Association Tunisienne des Auberges de Tourisme de Jeunes UAE Federation for Yo¢Jth Hostel & Sports Asociacion de Alberguistas del Uruguay Hostelling International USA QATAR ROMANIA SAUDI ARABIA SCOTLAND SERBIA SLOVENIA SPAIN SUDAN SWEDEN SWITZERLAND TUNISIA UNITED ARAB EMIRATES URUGUAY USA HI Assoclate Organisations COUNTRY GREECE ASSOCIATION Greek Youth Hostels Association 36