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← Khoja Shia Ithna-Asheri Muslim Community (Baquir) Limited

2024-12-31-accounts

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

Charity registration number 1122264 (England and Wales) Company registration number 06391353

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2024

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

LEGAL AND ADMINISTRATIVE INFORMATION

Trustees M Khoja
M A Railey
F Bandali
S Hassam
H Elias
H Jaffer
M Janmohamed
H Asaria
Secretaries F Bandali
H Jaffer
Charity number 1122264
Company number 06391353
Registered office 17 Clifton Road
Balsall Heath
Birmingham
B12 8SX
Auditor Deitch Cooper LLP
3 Hobbs House
Harrovian Business Village
Bessborough Road
Harrow
Middlesex
HA1 3EX

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

CONTENTS

Page
Trustees' report 1 - 3
Independent auditor's report 4 - 6
Statement of financial activities 7
Statement of financial position 8
Notes to the financial statements 9 - 19

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) FOR THE YEAR ENDED 31 DECEMBER 2024

The Trustees present their annual report and financial statements for the year ended 31 December 2024.

The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the Income Funds's governing document, the Companies Act 2006 and "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" (effective 1 January 2019).

Objectives and activities

The principal object of the Charity is the advancement, preservation and welfare of Islam in accordance with the doctrines of the Shia Ithna-Asheri Jafari faith and this is achieved through offering educational opportunities in the context of nursery, secular and religion education facilities.

The Charity provides a range of community activities including classes, seminars and a day nursery.

The wholly owned subsidiary of the Charity manages letting of various residential properties held by the Charity as investment property. The Charity also holds additional investment properties which are let to commercial tenants.

The Trustees have paid due regard to guidance issued by the Charity Commission, including its supplementary public benefit guidance on the advancement of religion, in deciding what activities the Income Funds should undertake.

Achievements and performance

During the year the Charity provided the following educational facilities and activities:

Muhammadi Madrasah

Muhammadi Nursery

ME School of Excellence and Examination Centre

The syllabus and scheme of work developed for Key Stage I and II, in addition, to the bespoke 11+ course and test material, is consistently reviewed and updated in line with the National Curriculum. In Secondary and A Level, MES offer English, Mathematics and all three Sciences from Year 7 to AS2, as well as iGSCE English to students from Year 9 and controlled science experiments.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

Financial review

The results for the year are shown on the Statement of Financial Activities and in the notes to the financial statements. The gross receipts of the Charity were £680,827 (2023: £642,902). Income from investment properties has increased compared to last year whilst income from charitable activities has remained consistent with last year. During the year, the fair value of investment properties decreased by £1,000,640 (2023: £1,195,811 increase). The charity made an overall net deficit for the year of £869,506 (2023: £1,281,376 surplus). Income received during the accounting period exceeded expenditure however temporary downward revaluations in the market value of the properties owned by the group have had an impact on the overall movement for the year in unrestricted funds.

Unrestricted funds of £2,866,656 (2023: £3,736,162) have been carried forward to forthcoming years. The Charity held no restricted funds or endowment funds during the year.

It is the policy of the Income Funds that unrestricted funds which have not been designated for a specific use should be maintained at a level equivalent to between three and six month’s expenditure. The Trustees consider that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the Income Funds’s current activities while consideration is given to ways in which additional funds may be raised. This level of reserves has been maintained throughout the year.

The Trustees keep under regular review the major risks to which the Charity is exposed, to ensure that steps are taken to mitigate those risks as far as possible.

Structure, governance and management

The Income Funds is a charitable company limited by guarantee. The Charity was set up and is constituted by a Memorandum of Association dated 5 October 2007.

The Charity is affiliated to the Khoja Shia Ithna-Asheri Muslim Community of Birmingham.

The Trustees, who are also the directors for the purpose of company law, and who served during the year and up to the date of signature of the financial statements were:

M Khoja T Jivraj (Resigned 26 July 2024) I Ramji (Resigned 26 July 2024) M A Railey F Bandali S Hassam I Janmohamed (Resigned 26 July 2024) H Elias H Jaffer (Appointed 26 July 2024) M Janmohamed (Appointed 26 July 2024) H Asaria (Appointed 26 July 2024)

The Trustees are appointed in accordance with the Articles of Association at the Annual General Meeting, or by the Trustees should a vacancy arise during the year. There must be a minimum of two Trustees and one third are required to retire by rotation each year but may stand for re-election should they be eligible.

None of the Trustees has any beneficial interest in the company. All of the Trustees are members of the company and guarantee to contribute £1 in the event of a winding up.

The Trustees meet regularly to manage strategy and the organisation. The day to day operations for the different educational activities are delegated to nominated individuals. The management of residential investment properties is undertaken by Khoja Shia Ithna-Asheri Muslim Community (Jaafery) Limited ("Jaafery"), the wholly owned subsidiary of the charitable company.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

Statement of Trustees' responsibilities

The Trustees, who are also the directors of Khoja Shia Ithna-Asheri Muslim Community (Baquir) Limited for the purpose of company law, are responsible for preparing the Trustees' Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company Law requires the Trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Charity and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.

In preparing these financial statements, the Trustees are required to:

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

Disclosure of information to auditor

Each of the Trustees has confirmed that there is no information of which they are aware which is relevant to the audit, but of which the auditor is unaware. They have further confirmed that they have taken appropriate steps to identify such relevant information and to establish that the auditor is aware of such information.

The Trustees' report was approved by the Board of Trustees.

H Elias Trustee

16 September 2025

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

INDEPENDENT AUDITOR'S REPORT

TO THE MEMBERS OF KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

Opinion

We have audited the financial statements of Khoja Shia Ithna-Asheri Muslim Community (Baquir) Limited (the ‘Income Funds’) for the year ended 31 December 2024 which comprise the statement of financial activities, the statement of financial position and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

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

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The Trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

INDEPENDENT AUDITOR'S REPORT (CONTINUED)

TO THE MEMBERS OF KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the Income Funds and its environment obtained in the course of the audit, we have not identified material misstatements in the directors' report included within the Trustees' report.

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

Responsibilities of Trustees

As explained more fully in the statement of Trustees' responsibilities, the Trustees, who are also the directors of the Income Funds for the purpose of company law, are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Trustees are responsible for assessing the Income Funds’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements, including how fraud may occur, by making enquiries of management and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. We also considered potential financial or other pressures, opportunity and motivations for fraud. As part of this, we identified the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations and how management monitor these processes. Appropriate procedures included the review and testing of journals.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

INDEPENDENT AUDITOR'S REPORT (CONTINUED)

TO THE MEMBERS OF KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates including those that relate generally to the operating aspects of the business. There are many laws and regulations, relating principally to the operating aspects of the company, that typically do not affect the financial statements and as such are not captured by the entity's information systems relevant to financial reporting. It is the responsibility of management to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations. The auditor is not responsible for preventing non-compliance and we cannot be expected to detect non-compliance with all laws and regulations. Representations were obtained from the board of directors that there is no identified or suspected non-compliance with any laws and regulations.

Our audit procedures focused on laws and regulations that are generally recognised to have a material effect on the financial statements or a direct effect on the determination of material amounts and disclosures, including the Charities (Accounts and Reports) Regulations 2008 and the Charities Act 2011. We considered the risk of acts by the company that may be contrary to these laws and regulations, including fraud. We assessed the extent of compliance with the laws and regulations identified through making enquiries of management and inspecting documentation and the audit team remained alert to instances of non-compliance with laws and regulations throughout the audit. Any unusual findings were investigated.

Significant audit attention was paid to judgements and accounting estimates in relation to all property valuations and recoverability of debtors, including the related disclosures in the financial statements. As in all of our audits, we also addressed the risk of management override of internal controls including testing and evaluation of whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud. We completed a review of transactions and journals taken from throughout the period. We have nothing to report in this regard.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that 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 my involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed noncompliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https:// www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

Mohamedkazim Bhaloo (Senior Statutory Auditor) for and on behalf of Deitch Cooper LLP 16 September 2025 Accountants Statutory Auditor 3 Hobbs House Harrovian Business Village Bessborough Road Harrow Middlesex HA1 3EX

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

STATEMENT OF FINANCIAL ACTIVITIES INCLUDING INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2024

Unrestricted Unrestricted Unrestricted Unrestricted
funds funds
2024 2023
Notes £ £
Income from:
Donations and legacies 3 3,000 23,290
Charitable activities 4 299,995 266,110
Investments 5 377,832 353,502
Total income 680,827 642,902
Expenditure on:
Cost of raising funds 6 311,348 308,039
Charitable activities 7 238,345 249,298
Total expenditure 549,693 557,337
Revaluation of investment properties 11 (1,000,640) 1,195,811
Net (expenditure)/income for the year/
Net movement in funds (869,506) 1,281,376
Fund balances at 1 January 2024 3,736,162 2,454,786
Fund balances at 31 December 2024 2,866,656 3,736,162

The statement of financial activities includes all gains and losses recognised in the year.

All income and expenditure derive from continuing activities.

The statement of financial activities also complies with the requirements for an income and expenditure account under the Companies Act 2006.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2024

2024 2023
Notes £ £ £ £
Fixed assets
Tangible assets 13 6,014 15,091
Investment property 14 5,837,360 6,838,000
Investments 15 1 1
5,843,375 6,853,092
Current assets
Debtors 16 288,995 136,429
Cash at bank and in hand 327,651 340,118
616,646 476,547
Creditors: amounts falling due within 18
one year (201,913) (153,959)
Net current assets 414,733 322,588
Total assets less current liabilities 6,258,108 7,175,680
Creditors: amounts falling due after
more than one year 19 (3,391,452) (3,439,518)
Net assets excluding pension liability 2,866,656 3,736,162
Net assets 2,866,656 3,736,162
Income funds
Unrestricted funds 2,866,656 3,736,162
2,866,656 3,736,162

The financial statements were approved by the Trustees on 16 September 2025

|M Khoja
Trustee|DocuSignedby:
|\<See|H Elias
Trustee| |---|---|---|

Company registration number 06391353 (England and Wales)

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2024

1 Accounting policies

Charity information

Khoja Shia Ithna-Asheri Muslim Community (Baquir) Limited is a private company limited by guarantee incorporated in England and Wales. The registered office is 17 Clifton Road, Balsall Heath, Birmingham, B12 8SX.

1.1 Basis of preparation

The financial statements have been prepared in accordance with the Income Funds's governing document, the Companies Act 2006, FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the Charities SORP "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" (effective 1 January 2019). The Income Funds is a Public Benefit Entity as defined by FRS 102.

The Income Funds has taken advantage of the provisions in the Charities SORP for charities not to prepare a Statement of Cash Flows.

The accounts have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a true and fair view. This departure has involved following the Statement of Recommended Practice for charities applying FRS 102 (effective 1 January 2019) rather than the version of the Statement of Recommended Practice which is referred to in the Regulations but which has since been withdrawn.

The financial statements are prepared in sterling, which is the functional currency of the Income Funds. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

These financial statements are separate company financial statements of the Charity and not of its group. The Charity is part of a wider group and consolidated financial statements are prepared which include the Charity and its group.

1.2 Going concern

At the time of approving the financial statements, the Trustees have a reasonable expectation that the Income Funds has adequate resources to continue in operational existence for the foreseeable future. Thus the Trustees continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3 Charitable funds

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of their charitable objectives.

Restricted funds are subject to specific conditions by donors or grantors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.

1.4 Income

Income is recognised when the Income Funds is legally entitled to it after any performance conditions have been met, the amounts can be measured reliably, and it is probable that income will be received.

Cash donations are recognised on receipt. Other donations are recognised once the Income Funds has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation. Legacies are recognised on receipt or otherwise if the Income Funds has been notified of an impending distribution, the amount is known, and receipt is expected.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

1 Accounting policies

(Continued)

1.5 Expenditure

Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement, and the amount of the obligation can be measured reliably.

Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges are allocated on the portion of the asset’s use.

1.6 Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures and fittings 25% Straight line Equipment 25% Straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the statement of financial activities.

1.7 Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Investment properties rented to another group entity are accounted for using the cost model. Other investment properties are subsequently measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in the income and expenditure account.

1.8 Fixed asset investments

Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in net income/(expenditure) for the year. Transaction costs are expensed as incurred.

A subsidiary is an entity controlled by the Income Funds. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.9 Impairment of fixed assets

At each reporting end date, the Income Funds reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

1.10 Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

1 Accounting policies

(Continued)

1.11 Financial instruments

The Income Funds has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Income Funds's balance sheet when the Income Funds becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Basic financial liabilities

Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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

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

Derecognition of financial liabilities

Financial liabilities are derecognised when the Income Funds’s contractual obligations expire or are discharged or cancelled.

1.12 Employee benefits

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the Income Funds is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13 Retirement benefits

The Charity operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the Charity in an independently administered fund. Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

2 Critical accounting estimates and judgements

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. They are based on historical experience and any other factors that may be relevant and are believed to be reasonable. Estimates and judgements are continually evaluated. If estimates and judgements are subsequently revised, revisions to accounting estimates are recognised as arising in the financial reporting period in which the estimate is revised.

The principal areas involving significant accounting estimates or judgements are the estimation of fair values of investment properties (note 14) and the recoverability of amounts reported within debtors as owed to the charity (note 16). The Trustees consider these estimates to be reliable however actual results may differ from these estimates and revisions to these estimates to reflect actual results may arise in a subsequent financial reporting period.

3 Income from donations and legacies

Unrestricted Unrestricted
funds funds
2024 2023
£ £
Donations and gifts 3,000 23,290
4 Income from charitable activities
Unrestricted Unrestricted
funds funds
2024 2023
£ £
Secular Education
Income from charitable activities 77,326 81,282
Madressa Fees
Income from charitable activities 64,991 54,438
Nursery Fees
Income from charitable activities 157,678 130,390
299,995 266,110
5 Income from investments
Unrestricted Unrestricted
funds funds
2024 2023
£ £
Rental income 377,832 353,502

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

6 Cost of raising funds

Unrestricted Unrestricted
funds funds
2024 2023
£ £
Investment property costs
Share of governance costs 2,043 838
Property management agents 4,578 5,200
Depreciation and impairment 5,389 5,750
Support costs 299,338 296,251
Investment property costs 311,348 308,039
311,348 308,039

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

7 Expenditure on charitable activities

Secular
Education
Madressa
2024
2024
£
£
Staff costs
30,606
-
Depreciation and impairment
1,182
835
Activities undertaken directly
18,020
49,876
49,808
50,711
Share of support costs (see note 9)
4,305
4,038
Share of governance costs (see note 9)
2,042
2,043
56,155
56,792		 Nursery
2024
£
107,675
4,416
7,240
119,331
4,025
2,042
125,398		 Total
Secular
Education
Madressa
2024
2023
2023
£
£
£
138,281
19,671
-
6,433
1,254
835
75,136
28,718
65,080
219,850
49,643
65,915
12,368
3,193
3,374
6,127
837
838
238,345
53,673
70,127		 Nursery
2023
£
91,727
4,705
6,791
103,223
21,438
837
125,498		 Total
2023
£
111,398
6,794
100,589
218,781
28,005
2,512
249,298

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

8 Support costs allocated to activities

Operating lease charges
Premises
General office costs
Finance costs
Insurance
SZ premises costs
Legal and professional
Bank charges
Promotion and marketing
Bad debts
Governance
Governance costs comprise:
Audit fees		 Total
2024
£
2,830
66,168
5,178
213,869
10,240
1,292
3,400
1,077
865
6,787
8,170
319,876
2024
£
8,170
8,170		 Total
2023
£
1,635
94,765
4,750
200,899
10,620
615
4,400
1,473
440
4,659
3,350
327,606
2023
£
3,350
3,350

9 Trustees

None of the Trustees (or any persons connected with them) received any remuneration or benefits from the charity during the year.

10 Employees

The average monthly number of employees during the year was:

Employment costs
Wages and salaries
Other pension costs		 2024
Number
11
2024
£
137,455
826
138,281		 2023
Number
11
2023
£
110,779
619
111,398

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

10 Employees

(Continued)

There were no employees whose annual remuneration was more than £60,000.

11 Gains and losses on investments

Unrestricted Unrestricted
funds funds
2024 2023
Gains/(losses) arising on: £ £
Revaluation of investment properties (1,000,640) 1,195,811

12 Taxation

The charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.

13 Tangible fixed assets

Fixtures and
fittings
£
Cost
At 1 January 2024
76,611
Additions
-
At 31 December 2024
76,611
Depreciation and impairment
At 1 January 2024
62,564
Depreciation charged in the year
10,778
At 31 December 2024
73,342
Carrying amount
At 31 December 2024
3,269
At 31 December 2023
14,047		 Equipment
£
50,668
2,745
53,413
49,624
1,044
50,668
2,745
1,044		 Total
£
127,279
2,745
130,024
112,188
11,822
124,010
6,014
15,091

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

14 Investment property

Investment property
2024
£
Fair value
At 1 January 2024 6,838,000
Net gains or losses through fair value adjustments (1,000,640)
At 31 December 2024 5,837,360

Investment properties are carried at their fair value at the reporting date. At the end of each reporting period, the Board of Trustees updates its assessment of the fair values of properties owned by the charity, taking account of the most recent valuations by external, independent and qualified valuers. The fair value adjustments form part of the surplus or deficit for the year on unrestricted funds. The most recent external independent valuation of these investment properties was performed as at 31 December 2024.

The investment property fair value estimates as at 31 December 2024 are based on capitalised income projections, based on a property's estimated rental income from its current tenants, and a capitalisation rate of 10% determined by a Chartered Surveyor. The property values provided by the Chartered Surveyor are also aggregated by location rather than providing a separate value for each property. The Chartered Surveyors engaged by the Trustees to assess market value reported that this drive-by valuation technique is an indicative guide of market value of the freehold interests based on limited information and is not a formal valuation. In the opinion of the Board of Trustees, these desktop values provide a reliable fair value of investment properties.

15 Fixed asset investments

Other
investments
£
Cost or valuation
At 1 January 2024 & 31 December 2024 1
Carrying amount
At 31 December 2024 1
At 31 December 2023 1
2024 2023
Other investments comprise: Notes £ £
Investments in subsidiaries 22 1 1

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

16
Debtors
Amounts falling due within one year:
Trade debtors
Amounts owed by fellow group undertakings
Other debtors
Prepayments and accrued income		 2024
£
69,909
183,172
35,914
-
288,995		 2023
£
29,287
95,822
2,570
8,750
136,429

17 Loans and overdrafts

Bank loans
Payable within one year
Payable after one year		 2024
£
2,680,452
42,000
2,638,452		 2023
£
2,722,518
36,000
2,686,518

The long-term bank loan represents an interest-only mortgage relating to certain investment properties, repayable other than by instalments. A market rate of interest is charged until the loan is repaid.

Bank loans are secured by way of charges over investment properties owned by the group.

18 Creditors: amounts falling due within one year

Notes
Bank loans
17
Trade creditors
Amount owed to parent undertaking
Other creditors
Accruals and deferred income		 2024
£
42,000
3,614
115,209
28,514
12,576
201,913		 2023
£
36,000
5,935
72,900
28,104
11,020
153,959

19 Creditors: amounts falling due after more than one year

Notes
Bank loans
17
Amount owed to parent undertaking		 2024
£
2,638,452
753,000
3,391,452		 2023
£
2,686,518
753,000
3,439,518

Docusign Envelope ID: 95F06FD0-D5D3-4D88-96F9-28A8CB907FA9

KHOJA SHIA ITHNA-ASHERI MUSLIM COMMUNITY (BAQUIR) LIMITED

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2024

20 Unrestricted funds

The unrestricted funds of the charity comprise the unexpended balances of donations and grants which are not subject to specific conditions by donors and grantors as to how they may be used. These include designated funds which have been set aside out of unrestricted funds by the trustees for specific purposes.

At
General funds
Previous year:
At
General funds		 1 January
2024
Incoming
resources
Resources
expended
Gains and
losses
At 31
December
2024
£
£
£
£
£
3,736,162
680,827
(549,693)
(1,000,640)
2,866,656
1 January
2023
Incoming
resources
Resources
expended
Gains and
losses
At 31
December
2023
£
£
£
£
£
2,454,786
642,902
(557,337)
1,195,811
3,736,162

21 Related party transactions

The company has taken advantage of the exemption available whereby it has not disclosed transactions with the ultimate parent undertaking or any wholly owned subsidiary undertaking of the group.

22 Subsidiaries

These financial statements are separate company financial statements of the Charity and not of its group.

Separate company financial statements of the Charity are required to be prepared by law. The Charity is exempt by virtue of the Companies Act 2006 from the requirement to prepare group accounts. Separate consolidated financial statements which include the Charity and all its subsidiaries are prepared and publicly available.

Details of the Charity's subsidiaries at 31 December 2024 are as follows:

Name of undertaking Registered Nature of business Class of % Held
office shares held Direct Indirect
Khoja Shia Ithna-Asheri United Kingdom Property rental business Ordinary 100.00
Community (Jaafery) Limited

Investments in subsidiaries are all stated at cost.

23 Ultimate controlling party

The ultimate controlling party is the Khoja Shia Ithna-Asheri Muslim Community of Birmingham (UK registered charity no. 1170675), whose principal place of business is 17 Clifton Road, Balsall Heath, Birmingham, B12 8SX. The Khoja Shia Ithna-Asheri Muslim Community of Birmingham prepares publicly available group accounts in which the Charity is consolidated.