2022-08-31-accounts - The Jerusalem Interest-Free Microfinance Fund Limited

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                                                       Company No. 6681463
                                                       Registered in England
                                                             and Wales

`THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED`

`FINANCIAL STATEMENTS`

FOR THE YEAR ENDED 31[ST] AUGUST 2022

`THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED`

`FINANCIAL STATEMENTS`

FOR THE YEAR ENDED 31[ST] AUGUST 2021

`Directors and Trustees`

Donald Franklin PhD
Fiyaz Mughal OBE
Rabbi Michael Pollak

Fiyaz Mughal resigned from his position with JIMF with effect on 31[st] May
2023 due to other pressures on his time.

Secretary

Rabbi Michael Pollak

Charity No.

`Registered Office`

19 The Park
London NW11 7ST

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31[ST] AUGUST 2022
I N D E X
                                                           Page Nos.
Report of the directors and trustees                           1
Independent examiner’s report                                  2
Profit and loss account                                        3
Balance sheet as at 31 August 2022                             4
Notes to the accounts                                          5

Page 1

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

`REPORT OF THE DIRECTORS AND TRUSTEES`

The directors and trustees have pleasure in presenting their report and
financial statements for the year ended 31[st] August 2022.

The accounts have been prepared in accordance with the accounting policies
as set out in Note 1 of the accounts and comply with the Charity’s governing
document, applicable law and the requirements of the Statement of
Recommended Practice, “Accounting and Reporting by Charities” (SORP 2005)
issued in March 2005.

`Status`

The Charity is a Company limited by guarantee and was incorporated on 26
August 2008 and registered as a charity on 8 January 2009. The Charity
operates from 19 The Park, London NW11 7ST. The Company was established
under a Memorandum of Association which established the objects and powers
of the charitable company and is governed by its Articles of Association.

`Directors and Trustees`

Donald Franklin PhD
Fiyaz Mughal OBE
Rabbi Michael Pollak

`Aims and Organisation`

The relief of financial hardship amongst people in poor communities in
Jerusalem by enabling them to establish and grow their own businesses
through the provision of micro finance and technical assistance.
(Microfinance includes loans and/or equity funding for small enterprises and
or their proprietors as appropriate for the individuals and firms seeking
assistance.)

`Investment and Reserves Policy`

`Risk Factors`

The trustees have taken advantage of the exemption available to charities
with incoming resources of less that £ 500,000 per year, from carrying out a
risk assessment of the charity, a requirement under SORP 2005.

`Developments during 2021/22`

The year under report (2021-22) saw a continuation in JIMF’s activity – with
a similar number of businesswomen and students receiving loans (forty-four;
cf.48 last year)

New loans were made to a value of over 637,000 shekels whilst repayments
were 614,000 shekels. After provisions and write-offs, loans outstanding
remain in excess of one million shekels (₪ 1,069,000).

The programme continues to operation in partnership with MATI Jerusalem, and
with a separate partnership with KIVA. As reported previously, there had
been an interruption in JIMF’s support to the charedi community. There has
now been a slow resumption, with the funding of a training post at MATI and
the initiation of lending (two further loans at the end of the reporting
year). Support continues for the Palestinian community in Jerusalem.

Page 1 Continued

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

REPORT OF THE DIRECTORS AND TRUSTEES – Continued

Developmentsduring 2021/22 – Continued

MATI continues to emphasise the importance of the loan programme to motivate
and to build upon their business-training in East Jerusalem for
disadvantaged women. MATI continues to run a branch in East Jerusalem; they
confirm that they have funding for training and post loan support.

2022 saw the completion of an evaluation of JIMF’s work in East Jerusalem. A
survey was held to examine and evaluate the impact of the program on the
participants – women new entrepreneurs and women businesses owners in East
Jerusalem. It was commissioned from EDU Station, which is a Bethlehem-based
Skills Development Center, and consultancy agency that is directed by the
co- founders – Mr. Tariq Al Bakri and Mr. Samer Awwad. The center offers
coaching and consultancy services, market studies, and evaluation surveys
for companies and cooperatives.

Four dimensions were examined: the effect of the loan on participants'
business development, the effect of the loan on participants' personal and
family well-being, the effect of the business management training courses
provided by MATI, and finally, the effect on implementation of the business
plan built for the loan recipients.

The survey was conducted among 60 participants who received JIMF interest-
free loans to start or expand a business between 2015 and 2019.
All 122 women who received loans in the last 6 years of the program were
contacted via mail, asking them to fill out the questionnaire. A phone call
followed the mail. Out of 122, 60 women responded and took part in the
survey.

The survey was conducted during the Corona pandemic; therefore, the ongoing
crisis influenced the answers given by the program's participants.
The studies were carried out by EDU Station, supervised by MATI, and was
funded by JIMF. The results of the evaluation are available on JIMF’s
website, www.jerusalemmicrofinance.com : they are encouraging.

JIMF and MATI continue to be supported in this work by Rehaam Jaber, a
Palestinian lawyer, who runs the East Jerusalem office. Rehaam has built a
relationship of trust for JIMF with our Palestinian clients, manifest in a
strong repayment record for loans issued since Rehaam was involved (2011).
When payments are missed, Rehaam follows up to understand the nature of the
problem, and in all cases has secured a recognition of obligation and (with
few exceptions) a resumption of repayment. As a consequence we have been
able to remove provisions for bad debt. We have agreed policies for moving
from persuasion to stronger interventions, in particular to refer the
obligation to the guarantors, but our strong preference is to avoid this
step, which embarrasses the women, but rather to work with the women so that
they themselves can take pride in being able to repay their loans.

JIMF continues to be designated an Experimental Field Partner with Kiva;
however this facility for relatively small partners is being removed by
Kiva, and no new loans will be issued under the KIVA facility during 2023.
(See http://www.kiva.org/partners and linked pages for details, including a

Page 1 Continued

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

REPORT OF THE DIRECTORS AND TRUSTEES - Continued

Developmentsduring 2021/22 – Continued

reference to JIMF’s partnership.  JIMF’s credit limit remains at US$
50,000.)

JIMF continued to be supported by donations from its regular funders.

The businesses and vocations that are being supported by JIMF are diverse.
The 26 businesses supported by JIMF in 2021/2 comprised:

a tourism office
two event design services
evening wear hire
hair salon
a photographic studio
a study centre
weight management
home sewing and embroidery
honey making (from bee hives)
home sale:
household goods
household equipment gifts & toys
sports clothing
retail outlets for, respectively:
women’s clothing (two)
on-line clothing
accessories
cosmetics (two)
on-line cosmetics
one creche
provision of cosmetics and massage
two home catering businesses.
a taxi service
IT consultancy service.

Vocational qualifications for 18 students were supported by training loans
for the following courses:

special needs teaching (four students)
nursing,
sociology and anthropology (
education
film production
art therapy
business management
accountancy
medical imaging
Arabic
finance and banking

Page 1 Continued

`THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED`

`REPORT OF THE DIRECTORS AND TRUSTEES - Continued`

Developmentsduring 2021/22 – Continued

◼ mathematics

◼ Hebrew literature

sociology and psychology

◼ non-profit management.

JIMF with MATI appraises applicants for the viability of the businesses, for
the neediness of the applicants, and for the value added to the local
community (as JIMF wishes to avoid supporting one business merely to
displace others). We are seeking accordingly to support creation of
innovative businesses that fill clear gaps in the local economy. Vocational
loans are similarly assessed against criteria of the credibility of the
course and the expectation that it will support profitable employment,
against the neediness of the applicants and the worthiness of the vocation
sought.

Page 1 Continued

`THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED`

`REPORT OF THE DIRECTORS AND TRUSTEES - Continued`

`Statement of directors’ and trustees’ responsibilities`

The directors and trustees are responsible for preparing the Annual Report
and the Financial Statements in accordance with applicable law and
regulations. Company law requires the directors to prepare financial
statements for each financial year. Under that law the directors have
elected to prepare the financial statements in accordance with United
Kingdom Generally Accepted Accounting Practice. The financial statements are
required to give a true and fair view of the state of affairs of the company
and of the profit or loss of the company for that period. In preparing those
financial statements the directors and trustees are required:

to select suitable accounting policies and then apply them consistently;
to make judgements and estimates that are reasonable and prudent;
to state whether the Financial Reporting Standard for Smaller Entities has been followed, subject to any material departures disclosed and explained in the financial statements;
to prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business.

The directors and trustees are responsible for keeping proper accounting
records which disclose, with reasonable accuracy at any time, the financial
position of the company and that enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also responsible for
safeguarding the assets of the company and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities. The
provisions within Part 15 of the Companies Act 2006 relating to small
companies.

Signed on behalf of the board of directors and the trustees

D. Franklin

.....................
D. Franklin
Director and trustee

Approved by the board on 31[st] May 2023

19 The Park,
London NW11 7ST

Page 2

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

Independent Examiner’s Reporton theaccounts for theyear ended31[st] August
2022 assetouton pages3-5

I report to the charity trustees on my examination of the accounts of the
Company for the year ended 31[st] August 2022.

As the charity’s trustees of the Company (who are also the directors of the
company for the purposes of company law), you are responsible for the
preparation of the accounts in accordance with the requirements of the
Companies Act 2006 (“the 2006 Act”).

Having satisfied myself that the accounts of the Company are not required to
be audited for this year under Part 16 of the 2006 Act and are eligible for
independent examination, I report in respect of my examination of your
charity’s accounts as carried out under section 145 of the Charities Act
2011 (“the 2011 Act”). In carrying out my examination, I have followed the
Directions given by the Charity Commission (under section 145(5)(b) of the
2011 Act).

I have completed my examination. I confirm that no material matters have
come to my attention which gives me cause to believe that: a. accounting
records were not kept in accordance with section 386 of the Companies Act
2006; or b. the accounts do not accord with such records; or c. the accounts
do not comply with relevant accounting requirements under section 386 of the
Companies Act 2006 other than any requirement that the accounts give a ‘true
and fair’ view which is not a matter considered as part of an independent
examination; or d. the accounts have not been prepared in accordance with
the Charities SORP (FRS102).

I have no concerns and have come across no other matters in connexion with
the examination to which attention should be drawn in this report in order
to enable a proper understanding of the accounts to be reached.

         M. S. Emanuel

Signed ……………………………………………
         M. S. Emanuel,
   Chartered Accountants,
   5, Lexham Gardens Mews,
   Kensington,
   London W85JQ

         31[st] May2023

Dated  ……………………………………………

Page3

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

`INCOME AND EXPENDITURE`	`ACCOUNT FOR THE YEAR`	`ENDED31 AUGUST 2022`	`ENDED31 AUGUST 2022`
	`Note`	`£`
		`----------------------`
		`2021`	`2022`
`Income`	`-1-`
`Donations received and total`	`incoming resources`
		`10,005`	`47,000`
		`------`	`------`
`Total income`		`10,005`	`47,000`
		`------`	`----`
`Expenditure`
`Training services`	`-5-`	`-`	`7,342`
`Evaluation`	`-5-`	`-`	`4,828`
`Bank charges and similar`
`administration charges`		`906`	`1,347`
`(Profit)/loss arising on the`
`translation of foreign currency`		`(8,433)`	`(34,697)`
`Provision and write-off for non-recoverability of`		`loans 692`	`(4,481)`
		`------`	`-----`
`Total expenditure`		`(6,836)`	`(25,661)`
		`------`	`-----`
`Surplus of income over`
`expenditure for the year`		`16,841`	`72,661`
`Balance brought forward`		`287,779`	`304,620`
		`-------`	`-------`
`Balance carried forward`		`£ 304,620`	`£ 377,281`
		`=======`	`=======`

The notes on page 5 form part of these financial statements.

Page 4

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

`BALANCE SHEET AS AT 31 AUGUST 2022`

	`Note`	`£`
	`---------------------------`
	`2021`	`2022`
`Current Assets`
`Balances at bank`	`110,713`	`127,146`
`Loans due from clients -2-`	`232,855`	`275,722`
	`-------`	`-------`
	`343,567`	`402,868`
`Creditors: amounts falling`
`due withinone year -3-`	`(26,562)`	`(14,522)`
	`-------`	`-------`
`Net Current assets`	`317,005`	`388,346`
`Creditors: amounts falling`
`after more than one year -4-`	`(12,385)`	`(11,065)`
	`-------`	`-------`
`Net assets`	`£304,620`	`£ 377,281`
	`=======`	`=======`
`Represented by:-`
`Unrestricted funds -6-`	`£304,620`	`£ 377,281`
	`=======`	`=======`
`Average number of employees`	`0`	`0`
	`==`	`==`

For the period 1 September 2021 to 31 August 2022, the company was entitled
to exemption from audit under section 477 of the Companies Act 2006 relating
to small companies and no notice has been deposited under section 476
requiring the Company to obtain an audit of the accounts for the period in
accordance with section 476.

The directors acknowledge their responsibilities for complying with the
requirements of the Companies Act 2006 with respect to accounting records
and the preparation of the accounts.

These accounts have been prepared under the historical cost convention in
accordance with FRS 105, the Financial Reporting Standard applicable to the
micro-entity regime and the provisions of the Companies Act 2006. The
company has decided not to file a profit and loss account with the Registrar
of Companies.

The Company is a private company limited by guarantee, registered in
England, Company No. 6681463 and its registered office is 19 The Park,
London NW11 7ST.

These accounts were approved by the board of directors on 31[st] May 2023 and
were signed on its behalf by:

`D. Franklin`

...................  Director

`D. Franklin`

The notes on page 5 form part of these financial statements.

Page5

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

`NOTES TO THE FINANCIAL STATEMENTS`

`1. Accounting Policies`

`Accounting basis and standards`

    The financial statements have been prepared under the historical cost
    convention and in accordance with the accounting policies set out
    below.

    These financial statements have been prepared in compliance with
    FRS 105 – The Financial Reporting Standard applicable in UK and
    Republic of Ireland and the Companies Act 2006.

`Compliance with SORP and legislation`

    The accounts have been prepared in accordance with the accounting
    policies and comply with the Charity’s governing document, applicable
    law and the requirements of the Statement of Recommended Practice,
    “Accounting and Reporting by Charities” (SORP 2005) issued in March
    2005.

    Incoming resourcesandexpenses

    Incoming resources represent donations and fees receivable. Resources
    expended are recognised in the year in which they are incurred.

`Fund accounting`

Funds are donations received or generated for the charity without
further specified purpose. These are funds that can be used in
accordance with the charitable objects at the discretion of the
directors (Trustees).

`Legal status of the charity`

The charity is a company limited by guarantee and has no share capital.
The liability of each member in the event of a winding up is limited to
one pound.

`Statement of cash flows`

The charity’s financial statements do not include a statement of cash
flows, since, in the opinion of the directors and trustees, such a
statement would not add significant information to that already
contained in the financial statements, including the note on loan
disbursements and repayments.

`Exchange rates`

Major transactions during the period were converted at rates prevailing
at the time of the transaction, minor transactions were converted using
an average of the rates prevailing at start and end of the year. Assets
and liabilities which existed at the balance sheet date were converted
at the rate prevailing at the year end. Any differences were
transferred to the profit and loss account.

Page5Continued

`THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED`

`NOTES TO THE FINANCIAL STATEMENTS - Continued`

			`£`
		`----------------------`
		`2021`	`2022`
`2.`	`Loans due from clients`
	`Loans due from clients repayable`
	`within 12 months`	`145,164`	`158,108`
	`Provision made for non-recoverability`	`(4,481)`	`(0)`
		`-------`	`-------`
		`140,683`	`158,108`
	`Loans due from clients repayable`
	`after more than 12 months`	`92,172`	`117,614`
		`-------`	`-------`
		`£ 232,855`	`£ 275,722`
		`=======`	`=======`

Loans provided to clients are shown in the balance sheet after
deducting repayments made during the year, and after deducting write-
offs of bad debt for extended delinquency of £0 (2021: £0).

Loans disbursed during the year amounted to £153,772 (2021: £ 155,372).
Loans repaid during the year amounted to £148,268 (2020: £136,690). The
remaining difference in the amount outstanding, after allowing for
write-offs and provisions, is attributable to the rate of exchange
prevailing at the year ends.

`3. Creditors: amounts falling due within one year`

`Loan due to D. Franklin (See Note 5)`	`10,268 0`
`Loan due to KIVA`	`16,294` `14,522`
	`------ ------`
	`£ 26,562 £ 14,522`
	`====== ======`

The US Dollar loans from Kiva are interest-free and repayable by
instalments linked to specific client loan repayments made in Israeli
Shekels, or may be used to fund new loans to clients, by agreement
between the Company and KIVA. The Company’s exposure to any exchange
difference is limited to 15% and is calculated at the time of repayment
to KIVA. For the purpose of preparing the annual accounts, provisions
for losses on exchange are charged in the Company’s profit and loss
account at the balance sheet date.

`4. Creditors: amounts falling after more than one year`

`Loan due to KIVA`	`£`	`12,385`	`£`	`11,065`
		`======`		`======`

Page5Continued

THE JERUSALEM INTEREST FREE MICROFINANCE FUND LIMITED

`NOTES TO THE FINANCIAL STATEMENTS - Continued`

`5. Related Party Transactions, and Training Services`

The outstanding loan from Mr D Franklin of £ 10,268 was interest-free
and repayable on demand; it has been repaid during the accounting
period.

Donations received include £47,000 (2021: £10,000) from charities on
which Donald Franklin is a trustee.

£

                                                                    -------

`6. Unrestricted funds`

`Balance`	`31 August 2021`	`£ 304,620`
`Surplus`	`income over expenditure for the year`	`72,661`
		`-------`
`Balance`	`31 August 2022`	`£ 377,281`
		`=======`

`7. Share Capital`

    The Company has no issued share capital but the Company is limited by
    guarantee.

`8. Ultimate Controlling Party`

    The Company is controlled by its directors.