THE ROYAL ARTILLERY INSTITUTION LIMITED IA Company Limited by Guarantee) REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 Registered Charity No: 1122002 Registered Company No: 6446232
ROYAL ARTILLERY INSTITUTION LTD CONTENTS Page Trustees, and Administrative Information Trustees, Report Report of the Auditors 10-13 Statement of Financial Activitie5 14 alance Sheet 15 Cash Flow Statement 16 Notes to the Financial Statements 17-24 Prior Year Comparative5 25
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES AND ADMINISTRATIVE INFORMATION Patron Her Majesty Queen Elizabeth11 RAI Trustees During the year ended 31 December 2021, and up to date of approval of thi5 report, the trustees were: Chairman Major General DM Cullen CB OBE - Chairman Members Brigadier NA Clissitt Colonel LM Forbes TD VR Col C P31mer Colonel G Taylor Colonel RST Murphy TD VR QVRM Colonel MAA Oornan Colonel AB Phillips Lieutenant Colonel JRM Gower MBE VR Lieutenant Colonel SJR Halliday TD Major MG Williams WOI IRASMI L Sanders WOI IRASMI RR Mealand Colonel RA Reserves Deputy Commander I" ISR Brigade Commander 7 Air Defence Group Deputy Commander I" Artillery 8rigade (Retired 7 Feb 221 Comdt Royal School of Artillery (Appointed 26 July 211 Comdt Royal School of Artillery (Retired 23 Jul 2111 Royal Artillery Sergeant Major IAppointed 7 Jun 221 Royal Artillery Sergeant Major (Retired 29 Apr 221 A rbumber of trustees are also involved in the governance of other charities referred to in this report. All trustees have made a declaration listing any related parties and potential conflicts of interest. Regimental Secretarv Colonel M G J Carter Finance Secretary Mrs B Hoblyn Bankers Lloyds Bank PLC 39 Piccadilly London WIVOAA 501Scltors Wilsons Solicitors Alexandra House, St John's Street Salisbury Wiltshire SPI 2SB Audltors Saffery Champness LLP 71 Queen Victoria Street London EC4V48E Investment Managers Brewin Dolphin 12 Smithfield street London ECIA 98D Addre55 Royal Artillery Barracks Larkhill Salisbury Wiltshire SP4 8QT Registered Charity No 1122002 Company No 6446232
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Introduction The Board of Trustees of The Royal Artillery Institution Ltd IRAII present their report and Bccounts for the year ended 31 December 2021 as required under the Companies Act 2006. The accounts comply with the Companies Act 2006, the charity's governing document and the relevant Statement of Recommended Practice (the Charities SORP IFRS 10211. The RAI is a charitable company, limited by guarantee and not having share capital. It is governed by Articles of Association. The Trustees, Report incorporates the dirertors, report for Companies Act purposes. The object of the charity, as described in its Articles of A550ciation, is the promotion of the efficiency of the Royal Regiment of Artillery and the officers. Warrant officers and Other Ranks thereof. The charity meets that requirement by making grants to regiments, individuals and other regimental organisations in support of regimental affairs. Regimental affairs are those matters which are essential to the domestic life of the Regiment as a whose and which are controlled by the Regiment itself, 5tJbject to the requirements of prevailing legislation. The following activities are included: regimental propertv,. regimental ceremonies, events and entertainment,. educational, historical and heritage affairs,. support to units and individuals, regimental sports and adventurous training, publications,. supplementary support for Royal Artillery bands- policy for regimental matters such as dress, messe5, heritage and ceremonial, all of which are supported by grants from the charity. Regimental welfare and the fostering of comradeship among all Gunners, serving and retired, are the responsibility of the Royal Artillery Charitable Fund IRACFI and Royal Artillery Association IRAAI. Or anisation The duties of the RAI Board of Trustees are laid down in the Articles of Association. The Board members provide a 5kills-based set of abilities and experience with some representinÈ the serving officers and soldiers of the Regiment. The RAI works closely with a number of other charities, in particular the ftoyal Artillery General Charitable Trust IRAGCTI, RACF and RAA, whose objects also support and promote efficiency within the Royal Artillery. The Board of Trustees meets at least twice a year as part of the Royal Artillery Board of Management alongside the trustees of the RACF I RAA. The RACF 15 the sole corporate trustee of the RAA. Subordinate to the Board of Trustees are the Investment Committee and a Finance and General Purposes Committee. These committees comprise trustees from both RAI and RACF, who have been co-opted for their skills and knowledge, so as to ensure that high quality advice may be provided to the RAI Board. The reports of these committees form part of the agenda of the meetings of the RAI Board of Trustees. The trustees form the membership of the RAI. The Master Gunnevs Committee sets the strategic framework for the Regiment and acts as an advisory board to the RAI Board of Trustees as required. The Chairman of the RAI is a member of the Master Gunnerfs Committee and update5 the committee biannually on business undertaken by the Royal Artillery Board of Management. The RAI works closely with other Royal Artillery charities and organisations that support and promote the Royal Artillery's heritage and traditions, most notably the Royal Artillery Historical Trust, the Royal Artlllery Historical Society and the Royal Artillery Museum. While the Charity Commission and Companies House websltes show the name of the company I charlty as 'Royal Artillery Institutlon Ltd,, ils correct tille in accordance wlth its Artlcles ol A550ciation is'The Royal Artillery Institutlon Ltd,.
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Governance In addition to the Articles of Association, the Investment and Finance & General-purpose committees have their own directives, which are reviewed and agreed regularly by the trustees. Powers delegated to the Secretariat are contained in the directives. Secretariat policies, which are agreed by the trustees, are in place in order to ensure smooth and effective running of the charity. The charity's risk register is reviewed annually by the trustees. Identified risks are managed as laid down in the Risk Management Plan. For specific items, detailed briefs are sent to the trustees so they can consider issues in depth before meetings. Trustees also receive regular reports on the value and movement of the charity's investment portfolio. The Chairman of the trustees and the Regimental Secretary meet regularly Iusually weekly) to discuss issues. Chari Commission Governance Code The RAI as one of ihe Royal Artillery charities, comes under the umbrella of the Confederation of Service Charities Icobseol. Cobseo, in consultation with the Charity Commi55ion, have produced a Service Charity toolkit based orb the 2017 Charity Commission Governance guide. The trustees carried out a self-a5sessment process using the toolkit during 2019. This enabled the Board to identify a number of enhancements which can be considered to improve Eovernance. This included a resolution to limit the tenure of trustees. It is planned to repeat self-asse5sment process in 2022. Selectlon of Members of the RAI Board of Mana ement The Articles of Association state the process for the appointment of trustees. New trustee5 are appointed by Resolution of the existing trustees. Trustees are normally seNinB and retired members of the Royal Artillery. The Master Gunner St James's Park is the Head of the Regimental Family, but he is not a trustee. The Master Gunner proposes the Chairman, who will normally have been a Colonel Commandant. The appointment of the Chairman is then approved by resolution of the existing trustees. Trustees are selected for their skills and experience and their ability to understand and anticipate the need5 of the servinE and retired regiment. The trustees will normally include the Commandant, Royal School of Artillery, Commander 7 AD Group and Deputy Commanders from l Arty Bde and I ISR Bde, who between them represent a large proportion of serving Gunner soldiers and officers. Ke Mana ement Personnel The Regimental Secretary is the Chief Executive of the RAI and is responsible for-. the day-to-day management of the charitvs business,. implementing policies agreed by the trustees and,. the management of the charity's staff. The Finance Secretary is responsible to the Regimental Secretary for the accounting of funds and all financial records. The Assistant Regimental Secretary leads on day to day activities and acts a5 Staff officer to the Master Gunner. Review of Financial Actlvlties The charitV5 funds continue to be employed to promote efficiency within the Royal Artillery. The detailed results for the year under review are shown in the Statement of Financial Activities at page 14. In 2021 the charity had an excess of income over expenditure before gains on investments of £45,815 12020= Income over expenditure before gains on investments £669,736. After investment gains of £1,489,87512020.' gain5 of £226,286) there was a net increase in funds of £1,535,69012020'. £896,022).
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Review of Financial Activities continued Total income decreased by £5,511 in the last financial year to £878,295 mainly due to a decrease in the grant received from RACF for Gunner. This was not required due to a decrease in publications and hence expenditure. Investment income from the portfolio achieved in excess of the budgeted £260,000 (the exce55 being retained in the portfolio) but the total £295,229 was £371 less than 2020. There were no legacies received in 2021 but 217 donations totalling £10,54412020'. 218 - £7,418). The majority of donations arise from historic standing orders for Gunner Magazine, where recipients have requested to no longer receive the publication but have chosen not to cancel their slanding order5. Income collected through the Service Pay Giving Scheme from serving members of the Regiment has increased by £6,266. General charitable expendlture before the 2020 E500K reversal grant to RAM increased by £110,390 to £701,00512020.' £590,6161. This was mainly due to increased expenditure on some of the activities funded by the charity following the lifting of some COVID19 restrictions. The overall expenditure figure is shown as increasing by £610,389, however, the 2020 account included a significant decrease in expenditure as a result of reversing the proposed 2020 £500K grant award to the Royal Artillery Museum. The remaining increase is accounted for by increased draw down on the Baxter Fund. There are four main income streams. They are.. Investment income Service Pay Giving Scheme ISPGSI, where all serving personnel are encouraged to give part of their pay to the charity Grants Donations The majority of funding comes from investment income134Yol and the SPGS140%1. The RAI drew dow £260,000 of investment income, which was in line with the budget for 2021. The balance of income from investments1£35,2291 was reinvested within the portfolio. The trustees approve the forecast of income and expenditure annually and monitor it regularly through the Finance & General Purpose Committee and at Board meetings. Bids for major grants are called for annually and are scrutinised as part of the budgetary proces5. Grants made by the Chairman of the Board and Regimental Secretary under their delegated financial powers are subsequently reported to the trustees. Charitable Activitie5 The RAI'5 object is the promotion of efficiency within the Royal Regiment of Artillery. This follows the Charity Commission's guidance on legitimate charitable purposes, one of which is "The promotion of the efficiency of the ormedforces of the Crown". The Charity Commission states.. "The ormedforces existfor public defence and security. It Is chorituble to promote the efficiency of the armedforces of the Crown us u means of deferjding the country. That includes ensuring thot thoseforces ore properly trained (ynd equipped during times of conflict. It (Jlso includes providingfucilities and benefitsfor the armedforces" The charity's principal activity during the year was the provision of grants to promote efficiency. DurinE the year the RAI made the following major grants in support of regimental events and activities judged by the trustees as conducive to the promotion of efficiency within the Royal Artillery..
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Charitable Activities continued Royal Arlillery sports teams - £143,618 Ilncluding £51,902 from RACFI Regimental heritage- £101,687 Regimental grant5 - £66,390 Gunner magazine & RA journal within raising funds- £43,539 Recruiting £21,800 RA HQ Mes5- £15,494 Details of additional grants can be found on page 20. The RAI holds and maintains a collection of chattels comprising pictures, silver and furniture which have been acquired by bequest, by purchase through subscription of the officers of the Regiment and through property being held by the charity following the disbandment of regiments and the placing in Suspended animation of individual Batteries la process that has been on-going since the end of the 2. World Warl. The charity loans items to regiment5, headquarters and Some individual officers in representational roles and these are accounted for annually. There are also a number of items on loan to regiments from the Royal Artillery Museum which are also monitored by the charity in order to ensure suitable insurance is in place. Public Benefit Accounting for the Collection is the principal responsibility of the Assistant Regimental Secretary who continues to review the holdings and maintain the database as additional items are received or loaned out. Much of the Collection (which totals more than 13,000 artefactsl is held in the Roy31 Artillery Mess at Larkhill where it imbues a sense of historical continuity, ethos and tradition to members of the reEiment, past and present, Other items are loaned to other Royal Artillery messes, other military messes, museum5 and other public bodies, in all totalling some 120 different locations. In addition to the above, the RAI continues to provide staff to support the Master Gunner, the Master Gunnels Committee and the Royal Artillery Board of Management in their representative and stewardship roles within the Royal Regiment. The Objects of the RAI are to promote efficiency and welfare within the serving Regiment and to assist those in need who are serving or who have served their country through service in the Royal Regiment of Artillery, and their dependants. Inextricably linl(ed with this Object is the aim of contributing to the public good by seNice to Her Majesty, the Country and all its citizens. The RAI contributes considerable public benefit to the local and national community by relieving need among members of the regimental family. This in turn maximises the likelihood of the charity's heneficiaries maintaininE their place as valuable, self-sufficient members of the community who are able to make a positive contribution to society. The charity works in tandem with the SSAFA, ABF (the Soldiers Charityl and the Royal British Legion IRBLI. The trustees have taken due regard of the Charity Commission's guidance on Public Benefit. Future Plans The charity has a sound financial base for future operations. The trustees will continue to support the evolving needs of the Royal Artillery and in particular the outcome of the Master Gunner St James's Park's Strategic Review which has six workstreams. The trustees will continue to respond to changes brought about under the workstreams, which are.. Governance,. People & Ethos,. Operational Purpose & Distinctive Competenties,. Heritage and,. Charities & Veterans. In particular they will seek to further the concept of "One Regiment"
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Future Plans continued In 2020 the trustees agreed to earmark £1.5M of capital funds for future transfer to the Royal Artillery Museum IRAMI. Of thi5 E500K was to have been in the form of a grant and £l.OM in the form of a loan. Although the offer of this sum has now been withdrawn following the retraction of the offer of a suitable site for the museum, the trustees are likely to consider making a similar level of funding available in the future once the conditions upon which the original offer was made are met. It is understood that a revised plan will be presented to the Master Gunners Committee in July 2022. It IS assessed that, following the removal of legally enforced Covid precautions, leve15 of activity will continue to return to near normal during 2022. The trustee has budgeted accordingly for the current year. Reserve5 Polic The trustees, policy is to maintain a sufficient level of reserves to= provide a stable base and income generation for the charity'5 continuing activities,. generate sufficient funds to cover routine management and administrative costs and,. enable the charity to respond to any emergency applications for Erants which may arise from time to time. Total fund5 as at 31 December 2021 were £12,681,55012020'. £11,145,860). Unrestricted reserves were £11,556,10512020= £10,059,931) of which are all free reserves. Restricted Fund5 were £1,125,445'12020'. £1,085,929) and compromises of Baxter Fund - £1,097,965,. Regimental Church - £16,980 and RA Church Refurbishment- £10,500 of which a large proportion is represented by investments. Our risk-based approach to determining our free reserves requirement is carried out, based on the anticipated future needs of the regimental family, and the management of financial risk5, particularly the uncertainty of future income from other sources. Trustees review the level of reserves regularly to ensure funds are available to deliver welfare services and programmes, and to secure, as far as possible, future financial viability. Our annual review of reserves included assessing the impact of Covid-19 on our business plans, projected income and expenditure, and on our investments. Following that review, we determined that we should hold a minimum of £10,000,000 in free reserves to be a55ured that we are able to 5UStain the 5UPPOrt we provide to the regimental family in the long term as well as meet other obligations, irrespective of fluctuations in income and without creating the need to actively fundraise. This sum, held as part of our investment portfolio, is judged to be capable of Benerating sufficient investment income to meet foreseeable needs. This sum, held as part of our investment portfolio, is judged to be capable of generating sufficient investment income to meet foreseeable needs, With free reserves of £11,556,105 currently exceed this requirement. The trustees are content that the additional fund5 we hold provide ability to disinvest in order to support major capital projects if and when required, but in the meantime are held as investments generating additional income. In 2021 the investment portfolio generated £295,229 for the charity, of which RAI received £260,000 as in year income. The balance of £35,229 was reinvested into the portfolio. The £260,000 wa5 34Yo of total income received. Without this level of income the charity's activities would be significantly curtailed.
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES. REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Reserves Pollc continued Trustees believe that investments should be maintained at the current levels, in order to generate income and provide for current needs whi15t ensuring the charity remains well placed to meet future requirements. The trustees recogn15e that they have no long term mandated liability for any particular level of financial grants or activity. They therefore have the ability to reduce expenditure to match income in the event of income reducing. Investment oli The trustees, Investment Committee meets twice a year to consider the performance of the RAI'S investments which are managed on a discretionary basis by Brewin Dolphin. The investment objective is to create sufficient income and capital growth to enable the charities to carry out their charitable objective5. The charity is expected to exist in perpetuity and investments are managed to meet the investment objective and ensure thls sustainability. The charity's funds are invested on an aliquot proportion in the same funds as the other Gunner welfare / efficiency charities. This 15 in order to achieve economies of scale in re12tion to investment cost5. The trustees have given the fund managers discretion to manage the portfolio within an agreed risk profile and against agreed benchmarks. This is contained in a written directive. At the bi-annual meeting with the investment managers the Investment Committee considers the state of the financi31 markets and measures the fund managers, on-going performance against specific agreed benchmarks, namely 30% FTSE All Share Index, 30Yo MSCI World ex UK Index, IOY. MSC1 Emerging Market5 Index, 7.5% FTSE All Stocks Gilt Index, 5% iBoxx Sterling Non-Gilts Index, IO% IPD UK All Balanced Funds Index, 5% Alternative (IA Sector Targeted Absolute Return) and 2.5% Cash Isterling Overnight Index Averagel.Having compared performances over the last 1, 3 and 5 years, the Investment Committee are of the view that the investments have done reasonably well in relation to the market and reSevant benchmarks, and that there is currently no case to prompt a change of investment policy. Envlronmental Governance and Social Consideratlons The RAI'S investments are not managed with any specific environmental, Social and governance IESGI restrictions. However it is expected that the RA charities, investment managers have clearly defined ESG investment policies and that the investments are managed by an investment company which is a signatory the UN Principles of Responsible Investment and which takes account of Environmental, Social and Governance IESGI factors in their research and investment decision making process. Fundralsln The trustees are very clear that als fundraising must be legal, open, honest and respectful. The charity does not actively engaEe in regular and organi5ed fundraising, although it does receive donations and legacie5. It receives the bulk of its income through investments and the Royal Artillery's 'service giving scheme,. The facility exists for individuals or organisations to make voluntary donations online. The charity does not work with any commercial partner or professional fundraisers except in order to operate an online donation facility such 'Enthuse' and 'Just Giving,. When donations are received they are mainly as a result of advertisements on the Gunner website and publications, and from open, grotjp brieflngs to members of the serving Regiment. In addition, regiments and other Gunner organisations are encouraged to engage in sponsored activities to raise funds. The charity does not 501icit funds through direct approaches to individuals via mailshots or online unless consent has been obtained. No complaints were received in 2021.
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Trustee Trainin Trustee responsibilities and necessary training are taken very seriously. All new members of the trustee board are briefed by the Regimental Secretary on their roles and responsibilities. They are provided with the Charity Commissioners handbook 'The Essential Trustee" a5 well as a copy of the Scheme. Recent RAI accounts, meeting, minutes and policy documents are also provided. Trustee briefing5 and training take place and members of the Board are encouraged to attend external trustee traininE and investment briefs. Risk Mana ement The trustees maintain a continuous oversighi of the principal areas of the charity's operations and the major risks, which may arise in these areas. In the opinion of the trustees the charity has established resources and review systems which, under normal conditions, should allow the risks iLfentified to be mitigated to an acceptable level. A risk management plan is produced and approved by trustees each year and managed actively by the trustees, the Regimental Secretary and his staff. The main risks are: Insufficienl income to meet the need: This Is managed by careful budgeting, the investment and reseNes policy and by controllinE the level of support provided to beneficiaries. Fraud.. This is guarded against by having policies in place to ensure regLJ13r checks are made and that all transactions are properly authorised by two signatories. Conflict of interest amongst trustees. A register of trustee interests is kept and updated annually. At the start of committee and Board of Management meetings, trustees are reminded to declare any conflict arising from the agenda so that appropriate action can be taken. Reputational damage arising from activities. This is mitigated by oversight of activities by the trustees and senior management. Rernuneration Pollc No trustee is paid as an employee or for services as a trustee, though travel and subsistence costs incurred a5 3 trustee are reimbursed. One trustee was engaged through his Companyi under contract to supply consultancy service5 to the charity. This was in line with Clause 6.3 of the Scheme. The trustees review staff salaries annually and take into account the MOD pay awards for similar grades, when recommending any pay increases. Em ees The RAI aims to be an organisation for which employees enjoy working and where they feel 5UPPOrted, valued, empowered and developed. Employees are kept fully informed about the aim5 and objectives of the charity and how it is achieving them. Employees are encouraged to contribute suggestions to help improve working processes and to achieve best practice. The charity is an equal opportunities employer and is committed to training and developing it5 Staff. Trustees, Liabili The liability of RAI trustee5 for debts of The Royal Artillery Institution Ltd is limited to an amount not exceeding one pound.
THE ROYAL ARTILLERY INSTITUTION LTD TRUSTEES, REPORT FOR THE YEAR ENDED 31 DECEMBER 2021 Statement of Trustees, Res onsibilities The trustees (who are also directors of the RAI for the purposes of Company lawl are responsible for preparing the Trustees, Report and the financial statements in accordance with applicable charity and company law and United Kingdom Accounting Standards Iunited KinEdom Generally Accepted Accounting Practice (UK GAAPI. The Company and Charity law applicable in England & Wales and UK GAAP 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. This includes details of income and expenditure and the application of resources for the period. In preparing these financial statements, the trustee are required to.. select suitable accounting policies and then apply them consistentlyi adhere to the methods and principles in the Charities Statement of Recommended Practice (Charities SORP IFRS 10211; make judgements and estimates that are reasonable and prudent; state whether applicable accounting standards have been followed, subject to any material departures which are to be disclosed and explained in the financial statements- prepare the financial statements on a going concern basis, unless it is inappropriate to presume that the charity will continue in business. The trustees are also responsible for safeguarding the assets of the charity, including taklng reasonable steps to prevent and detect fraud and other irregularities. The financial Statements have been prepared in accordance with the accounting policie5 set out in notes to the accounts and comply with.. the Companies Act 2006,. the charit$ governing document,. the Charities Acts 2011 and,. the SORP applicable to charitie5 preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 (Charities SORP IFRS 10211. Statement as to Disclosure of Information to Auditors In so far as the trustees are aware.. There is no relevant audit information of which the charitable company's auditor is unaware,. and The trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information. Thi5 report has been prepared under the special provisions of Part 15 of the Companies Act 2CX)6. On behalfofthe trustees IK 2022 Major General M Cullen CB OBE Chairman RAI Board of Trustees
THE ROYAL ARTILLERY INSTITUTION LTD INDEPENDENT AUDITORS REPORTTOTHE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2021 Opinion We have audited the financial statements of Royal Artillery Institution Limited for the year ended 31 December 2021 which comprise the statement of financial activities, balance sheet, cash flow statement and notes to the financial statement5, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland Iunited Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements.. give a true and fair view of the charitable company's state of affairs as at 31 December 2021 and of its incoming resources and application of resources, includine its income and expenditure, for the year then ended,. have been properly prepared in accordance with United Kingdom Generally Accepted AccountinE Practice,. and have been prepared in accordance with the Companies Act 2006. Basi5 for opinion We conducted our audit in accordance with International Standards on Auditing IUKI IISAS IUKII and applicable law. Our responsibilities under those standards are further described in the Auditorfs responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial Statements in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We belleve that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Concluslon5 relatlng to going concern In auditing the financial statements, we have concluded that the trustees, use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertaintie5 relating to events or conditions that, individually or collectivelyi may cast SlEnificant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve month5 from when the financial statement5 are authorised for issue. Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report. Other information The trustees are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appear5 to be materially misstated. If we identify such material incon5iStencies or apparent material misstatements, we are required to determine whether this gives rlse to a material misstatement in the financial statements themselves. If, based on the work we have io
THE ROYAL ARTILLERY INSTITUTION LTD INDEPENDENT AUDITOF15 REPORTTO THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2021 performed, we conclude that there is a material misstaternent of this other information we are required to report that fact. We have nothing to report in this regard. Opinions on other matters prescribed by the Companles Act 2006 In our opinion, based on the work undertaken in the course of the audit.. the information given in the Trustees, Annual Report which includes the Directors, Report for the financia5 year for which the f inancial statements are prepared is consistent with the financial statements,. and the Trustees, Annual Report which includes the Directors, Report has been prepared in accordance with applicable legal requirements. Matters on whlch we are required to report by exception In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material mi5Statements in the Trustees, Annual Report. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion.. adequate accounting records have not been kept, or return5 adequate for otjr audit have not been received from branches not visited by us,. or the financial statement5 are not in agreement with the accounting records and returns,. or certain disclosures of trustees, remuneration specified by law are not made. or we have not received all the information and explanations we require for our audit,. or the trustees were not entitled to prepare the financial statements in accordance with the small companies regime and to take advantage of the small companies exemption in preparing the Trustees, Annual Report and the Strategic Report. Responsibilities ot trustees As explained more fully in the Trustees, Responsibilities Statement set out on pages 9, the trustees (who are also directors of the charitable company for the purposes of company lawl are responsible for the preparation of the financial statements and for being satisfied that they eive a true and fair view, and for such internal control a5 the trustees deterTnine 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 trustee5 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 to do so. Auditor's responsibllitles for the audit of the financial statements We have been appointed as auditors under the Companies Act 2006 and report in accordance with regulations made under that Act. Our objectlves are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but 15 not a guarantee that an audit conducted in accordance with ISAS IUKI will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the li
THE ROYAL ARTILLERY INSTITUTION LTD INDEPENDENT AUDITORS REPORTTOTHE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2021 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the ba515 of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatement5 in respect of irregularitie5, including fraud. The Specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below. Identifying and assessing risks related to irregularities.. We assessed the susceptibility of the charitable companW5 financial statements to material misstatement and how fraud might occur, including through di5CUS5ions with informed management, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these contro15 operated as intended. We evaluated possible incentives and opportlsnities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the charitable company by discussions with informed management and updating our understanding of the sector in which the charitable company operate5. Laws and regulations of direct significance in the context of the charitable company include The Companies Act 2006, and guidance issued by the Charity Commi55ion for England and Wales. Audit response to r15k5 identified.. We considered the extent of cornpliance with these laws and regulations as parl of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the charitable company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities lo identify potential material misstatement5 arising. We discussed the charitable company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance. During the planning meeting with the audit team, the engagement partner drew attention to the kev areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addre55ed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal coursè of business. We assessed whether judgements made in Tnaking accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner's review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud. There are inherent limitations in the audit procedures described above and the further removed non- compliance with laws and regulations is from the events and transactions reflected in the financi31 statements, the less likely we would become aware of it. A150, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. A further description of our responsibilities is available on the Financial Reporting Council's website at-. www.frc.or auditorsres onsibilitie5. This description forms part of our auditorf5 report. 12
THE ROYAL ARTILLERY INSTITUTION LTD INDEPENDENT AUDITORS REPORTTOTHE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2021 Use ofour report This report is made solely to the charitable company'5 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'5 members those matters we are required to State to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as body, for our audit work, for this report, or for the opinions we have formed. Cara Turtington (Senior Statutory Auditor) For and on behalf of Saffery Champness LLP Chartered Accountants Statutory Auditors 71 Queen Victoria Street London EC44BE Date.. IF 2ozE Saffery Champness LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006 13
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THE ROYAL ARTILLERY INSTITUTION LTD BALANCE SHEET AT 31 DECEMBER 2021 2021 2020 Fixed assets Investments 12,514,425 12,514,425 10,755,035 10,755,035 Current assets Stocks Det)tors Cash at Bank and in hand 15,043 30,095 376,891 422,029 15,957 30,597 495,865 542,419 Current liabilities Creditors.. Amounts falling due within one year io 1254,9041 167,125 12,681,550 1151,5941 Net current assets /{liabilitiesl Total a55ets less Current liabilities Fund5 390,825 11,145,860 Unrestricted Funds 11,556,105 10,059,931 Restricted Funds li 1,125,445 1,085,929 12,681,550 11,145,860 The notes on pages 17- 24 form part of these financial statements. App ved by the trustees on 2022 Majo 6446232 DM Cullen CB OBE Chairman The RAI Board of Trustees Company number.. 15
THE ROYAL ARTILLERY INSTITUTION LTD CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2021 2021 2020 Note Net cash used in operating activitie5 1144,6881 1117,3921 Cash flows from investin activities Dividends, interest and rent5 from investments Purchase of investment5 Proceeds from sale of investments 295,229 12,975,547) 2,949,779 295,600 11,143,114) 1,126,261 Net cash used in investing activities 269,461 278,747 Net increase in cash & cash equivalents Cash & cash equivalents at the beginning of the year 124,773 161,355 647,189 485,834 Cash and cash equivalents at end of the year 771,962 647,189 Notes to the cash flow statement Reconclllatlon of net movement in funds to net cash flow from operating attivitie5 2021 2020 Net movement in funds IGainl/loss on investments Investment income Increase in investments due to changes in aliquot Decrease in stock Decrease in debtors IncrÈase/lDecreasel in creditors Net cash used in operatinB activities 1,535,690 11,489,8751 1295,2291 896,022 1226,2861 1295,6001 5,096 982 11,491 1509,0971 1117,3921 914 502 103,310 1144,6881 Analysis of cash and cash equlvalents and net debt AtlJan 2021 Cash flow At 31 Dec 2021 COIF Charitie5 Deposit Cash on short term deposit Cash held in Investments Net cash provided by operating activities 19,622 476,243 151,324 647,189 119,6221 199,3521 243,747 124,773 376,891 395,071 771,962 16
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIALSTATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 Accounting policies The Royal Artillery Institution is a company limited by guarantee incorporated in England and Wales. The registered office is Artillery House, Royal Artillery Barracks, Larkhill, Salisbury, SP4 8QT. 1.1 Basis of accounting The financial statements have been prepared under the historic cost convention, with the exception of listed investments which are included at their market value. The accounts (financial statements) have been prepared in accordance with the Statement of Recommended Practice.. Accounting and Reporting bv Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (Charities SORPIFRS10211, the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland IFRS 1021 and the Companies Act 2006 and UK Generally Accepted Accounting Practice. The Royal Artillery Institution constitutes a public benefit entity as defined by FRSIO2. 1.2 Going Concern The trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis in preparing the annual financial statements. 1.3 Investment income Investment income is credited to the statement of financial activities when its receipt is probable and the amount receivable can be measured reliably. It is allocated to both restricted and unrestricted funds on the basis of an aliquot proportion across the whole portfolio. 1.4 Subscriptions, donatlons and legacies Subscriptions and donations are recognised as income when the amounts are receivable. Legacie5 are recognised when received or receipt is probable and the value can be measured with sufficient 1.5 Expenditure & support C05t5 Expenditure is recognised in the period in which it is incurred and includes attributable VAT which cannot be recovered. Support5 Costs are those costs which have not been directly allocate to an activity of the charity but nevertheless support these activities. 1.6 Grant expenditure Grants payable are payments made in furtherance of the charitable objects of the charlty. These are accrued once the recipient has been notified of the grant award. The notification gives the recipient a reasonable expectation that they will receive the grant. Provisions for grants are made when the intention to make a grant has been communicated to the recipient but there is uncertainty as to the timing of the grant or the amount of grant payable. 17
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 1.7 Fund a¢¢ounting Unrestricted funds are available to use to further any of the purposes of the charity. Restricted funds are donations which the donor has specified are to be solely used for particular areas of the charity's work or specific projects being undertaken by the charity. 1.8 Fixed asset investments Fixed as5et5 investments are stated at mid-market value. The unrealised movement in market value from one year to another is recognised in the statement of financial activities. 1.9 Stocks Stocks are valued at the lower of cost and net realisable value. 1.10 Pensions Staff are enrolled in a NEST pension scheme. Contributions are charged in the Statement of Financial Activities as they become payable. 1.11 Cash & cash equivalents Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less. 1.12 Assets not included within the balance sheet The collection of chattels comprising of pictures, silver and furniture which have mainly been acquired through bequest, by purchase through subscription of the officer5 of the regiment and throuEh property reverting to the charity upon disbandment of regiments is not included in the balance sheet as the historic cost of any assets purchased is not known and is considered likely to be immaterial. The artefacts are largely held at the Royal Artillery Mess at Larkhill with others being held at other military messes, museum5 and other public bodies. The assets are held as part of the setting of the regiment for future generations. The insurance value of these assets Is £7.5 million. 1.13 Financial Instrument5 The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method. Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due Credito¥s and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally reco8nised at their settlement amount after allowing for any trade discounts due. 18
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 1.14 Critical estimate and judgements and key source5 of estimation uncertainty In the application of the Charity's accounting policies, the trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates are recognised in the period in which the estimate is revised where the revi5i0n affects only that period, or in the period of the revision and future periods where the revision effects both current and future periods. There are no critical estimates, judgements or key sources of estimation uncertainty In 2021 or 2020. Donations and legacies inc SPGS 2021 2020 Officers, stjbscriptions ISPGSI Soldiers, subscriptions ISPGSI Reserve Regiments Donations Intangible Income- Wages in Kind 196,378 149,449 193,004 146,557 800 9,995 83,986 434,342 10.544 84,237 440,608 Charltable Activities Income. 2021 2020 RA Publications- Subscription RA Publications- Advertising income Grant5 IRAI & RACFI Grant5 Received Government Grant- FurSough Officers Mess Fund Iwritebackl Royalties Investment Irbcome 32,309 686 39,244 600 82,000 55,742 50,000 11,014 19,622 618 1,125 140,480 152,480 Other Income 2021 2020 Sale of books Receipts of Laid Down Wines Bank Interest Sandown Food 219 362 1,757 47 975 1,978 1,384 19
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIAL STATEMENTS {continued) FOR THE YEAR ENDED 31 DECEMBER 2021 Charitable Activitie5- Grants Paid 2021 2020 Annual Allocations.. The Gunner Magazine The Master Gunnerfs Fund RA Sports RA HQ Me5S RA Central Sergeants Mess Fund Support of Units- Unit Grants Support to Units Senior/Commanding Officers Recruiting Regimental Expenses Annual Contingency Reserve 1,160 3,376 143,617 15,494 6,500 66,390 8,142 5,000 622 127,477 6,967 13,000 65,190 2,750 21,800 26,817 17,420 310,716 19,561 742 4,894 246,203 Other Grants.. Adventurous Training Regimental History Vlll Sandown Transport Misc 1,758 423 1,025 10,OOD 5,713 521 17,259 38,250 1500,0001 1198.2881 2,181 101,687 Grants in Year to RAM Grants Payable to RAM Icancelledl Total Grants Paid 414,584 Support Cost to Charitable Activities.. Salaries Employers Pension Contributions Wages in Kind 145,879 10,877 84,237 240,993 145,961 10,805 83,987 240,753 Presentation & Awards Printing, posta8e & Stationery Computer software/Hardware Insurance Chattels Imaintenaneel Travelling & Entertainment Miscellaneous Audit Fees Audit Fees Under Provision Legal and Professional Fees 7,921 3,505 4,370 3,313 12,540 176 899 8,718 18691 3,524 2,121 3,831 16,056 232 2,994 10,170 2,250 7,842 48,151 3,986 45,428 Total Charitable Actlvltles 701,005 90,616 20
THE ROYAL ARTILLERY INSTITUTION LTD NOTE5 TO THE FINANCIAL STATEMENTS Icontinuedl FOR THE YEAR ENDED 31 DECEMBER 2021 Charitable actlvltles- Support Costs continued The average number of person5 employed by the Fund during the year was.. 2021 Number 2020 Number Office and administration There were no employees with emoluments above £60,000. The following payments were made to Key Management Personnel.. £13,59212020.. £14,076). No trustees received any out of pocket expenses in 202112020.. NILI. One trustee received £468 in respect of consultancy services to the charity12020'. E2,7281. Investments 2021 2020 uoted investments Market value at l January Purchases Sales proceed5 Investment Management Fee Net rea115ed/Lsnrealised Losses Aliquot Changes Cash movements 10,755,035 10,516,573 2,975,547 1,143,114 12,949,7791 11,126,261) 150,4641 143,2591 1,489,875 226,286 15,0961 43,678 294,211 Market value at 31 December 12,514,425 10,755,035 Historical value at 31 December 8,808,917 7,278,707 The following holding exceeded 5% of the total portfolio value at the 31" December 2021 and are considered material. Vanguard Funds 1,053,713 2021 2020 Investment Investment5 Income Account Dealing & Deposit Account Market value at 31 December Cash Breakdown 12,119,354 10,603,729 27,241 23,882 367,830 127,424 12,514,425 10,755,035 21
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIALSTATEMENTS Icontinuedl FOR THE YEAR ENDED 31 DECEMBER 2021 Stocks 2021 2020 Medals and Sword5 Books 8,652 6,391 9,566 6,391 15,043 15.957 Debtors 2021 2020 Accrued Service Giving Income Insurance on behalf of third parties Investment Income Gift Aid 28,638 122 1,177 158 30,095 29,098 122 1,212 165 30,597 Cash at bank and in hand 2021 2020 COIF Charities Deposit Fund Bank current accounts 19,622 476,243 495,865 376,891 376,891 10. Credltors 2021 2020 Amounts falling due within one year- Gunner Investment Income RAHT Investment Income CSM Investment Income Accrual - Audit and accountancy RAM Other Creditors RHA Association Red Cypher 1,177 8,007 19,547 9,444 48,000 32,191 113,372 23,166 1,212 7,582 17,151 10,170 17,540 97,939 254,904 151,594 22
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 DECEMBER 2021 ii. 2021 Restricted Fund Balance Incoming Outgoing Net Gain on l January 21 Resources Resources Investment Transfers Balance at 31 December 21 Baxter Fund 960,510 97,939 33,988 33,988 137,455 1,097,965 Royal Horse Artillery Assoc Regimental Church Royal Artillery Church Refurbishment 197,9391 16,980 10,500 16,980 10,500 Total 1,085,929 33,988 33,988 137,455 197,9391 1,125,445 The transfer corrects the presentation of the balance due to the Royal Horse Artillery Association, which is included within creditor5. 2020 Restricted Fund Balance Incoming Outgoing Net Gain on l January 20 Resources Resource5 InvestmentE Transfers Balance at 31 December 20 Baxter Fund 938,468 111,159 18,989 1,816 118,9741 117,5551 22,027 2,519 960,510 97,939 Royal Horse Artillery Assoc Regimental Church Royal Artillery Church Refurbishment Total 16,980 10,500 16,980 10,500 1,077,107 20,805 136,5291 24,546 1,085,929 The Bèxter Fund is restricted for the benefit of the King's Troop, Royal Horse Artillery. The Regimental Church Fund is restricted for the benefit of Re8imental Church. The RA Church Refurbishment is restricted for the refurbishment of the RA Larkhill Garrison Church. 23
THE ROYAL ARTILLERY INSTITUTION LTD NOTES TOTHE FINANCIAL STATEMENTS Icontinuedl FOR THE YEAR ENDED 31 DECEMBER 2021 12. Analysis of net assets between fund5 2021 Current Iliabilities11 assets Net Investments Total Restricted fund5- Baxter Fund Regimental Church Fund RA Church Refurb 1,095,113 2,852 16,980 10,500 30,332 1,097,965 16,980 10,500 1.125,445 1,095,113 Unrestricted funds- General Fund 11,419,312 136,793 11,556,105 12,514,425 167,125 12,681,550 Analysls of net assets between funds 2020 Curyent Net Investments assets Total Restricted funds: Baxter Fund Royal Horse Artillery Regimental Church Fund RA Church Refurb 972,659 69,123 112,1491 1,816 16,980 10,500 17,147 960,510 97,939 16,980 10,500 1,085,929 1,068,782 Unrestricted fund5'. General Fund 9,686,253 373,678 10,059,931 10,755,035 390,825 11,145,860 14. Related party transactions Income of £345,82712020= £339,561) was received from the Royal Artillery General Charitable Trust IRAGCTI of which both charities have a number of trustees in common. This Income relates to accrued Income from the Service Giving Scheme, which were voluntary contributions from service personnel. Income of £8,00712020'. £8,0271 was received on behalf of Royal Artillery Historical Trust of which both charities have a number of trustees in common or who have the right to become a trustee of both. This Income relates lo Interest earned on Investments. Income of £14,39612020'. £14,433) was received on behalf of the Central Sergeant Mess ICSMI of which the Royal Artillery Sergeant Major IRASMI is an member of the Royal Artillery Institution IRAII and the Chair of the Central Sergeant Mess. This Income relates to Interest on Investments. At the year end, balances due to and from related entities are disclosed in notes 8 and 10. 24
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