# _**LEISURE & AMENITIES FUND**_ ## _**HMS NELSON**_ ## **ANNUAL REPORT AND FINANCIAL STATEMENTS** ## **For Period** **1 January 2020 to 31 December 2020** **Registered Charity No. 1128785** ## **Trustees’ Annual Report and Comments** |||Leisure & Amenities Fund| |---|---|---| |||HMS NELSON| |Charity Registered No:||1128785| |Covering the Accounting Year:||1 January 2020 to 31 December 2020| |Address:||Neptune Block| |||HMS NELSON| |||HMNB Portsmouth| |||Portsmouth PO1 3HH| |Governing Document:||Constitution| |Objectives:||To promote the military efficiency and well being of Naval and| |||other Service personnel serving in HMS Nelson and the Naval| |||Base, including Lodger Units and members of the Portsmouth| |||Flotilla ashore.| |Trustee:||Commodore J J Bailey ADC Royal Navy| |Trustee selection method:||Appointed as such by the Naval Secretary.| |Bankers||Co-operative Bank| |||PO Box 250| |||Delf House| |||Southway| |||Skelmersdale WN8 6WT| |Independent Examiner:||Peter NichollsMBE MAAT| |||5 Nursery Road| |||Havant| |||Hants PO9 3BG| |Activities and Achievements|The provision of leisure and domestic amenities and support of|| ||social and sporting life within the resources available. Individual|| ||and departmental activities were supported through the sports|| ||budget.|| |Financial Review:|The activities of the fund had been curtailed for much of the year|| ||by the Covid 19 situation. The value of the fund had fallen by|| ||£31.5K There were four main reasons:|| ||•|An overall fall in the market value of investment of £4K.| ||•|A reduction in gainshare income of £10.8K.| ||•|The Bike Scheme cost £3.9K.| ||•|A reduction in gaming income of £12.5K.| ||The fund was worth £1.04M of which £848K was held in long|| ||term investments. Property assets, mainly the three narrowboats|| ||and the lodge, had a book value of nearly £120K. The current and|| ||deposit accounts held nearly £97K which easily covered liabilities|| ||of £40K.|| Investment Selection Policy. The investments are held by Quilter Cheviot Asset Management for active management. Objective is to grow the capital value of the portfolio as well as generating some degree of income. The attitude to risk will be medium tolerance but can accept moderate variation or disruption to capital value or current income in order to meet the longer term objectives. Financial Reserves Policy: The Trustee has considered the level of reserves to retain, appropriate to the charity’s needs. These are held in the investments with a value of £800K to £875K. This will cover the fund if there is no income in 12 months and will also pay for capital projects. The Trustee aims to ensure that the charity will be able to fulfil its charitable objectives even if there is a temporary shortfall in income and unexpected expenditure. The Trustee will endeavour not to set aside funds unnecessarily. Grant Policy: Makes grants to individuals and ships alongside in Portsmouth. Risk Assessment: The Trustee reviews the major risks to which the charity is exposed, and systems have been established to manage those risks and believes that by maintaining the free reserves stated it will provide sufficient resources in the event of adverse conditions. Public Benefit Statement This fund provides public benefit by assisting Service personnel to more effectively perform their roles within the Armed Forces of the Crown. It does this by providing and supporting additional leisure and social activities beyond that supplied by the Crown. This assistance enables Service personnel to face the challenges and danger associated with military service by developing and maintaining teamwork, spirit and attitude, and morale. As a result, the fund promotes the efficiency of the Armed Forces of the Crown by enhancing the Royal Navy’s and Royal Marines’ capability to undertake the roles demanded of it including the defence of the United Kingdom and its interests. I confirm that have paid due regard to the Charity Commission of England and Wales’s guidance on public benefit when deciding what activities the charity should undertake. Declaration: I declare, in my capacity of Charity Trustee, that I have approved the above report. Signature Signed on Original Name Commodore J J Bailey ADC Royal Navy. Appointment Naval Base Commander and sole Managing Trustee Date 17 March 2021. ## **Independent Examiner’s Report to the Trustee of the HMS Nelson Leisure and Amenities Fund.** I report on the accounts of the Charity for the year ended 31 December 2020 which are set out in pages 1 to 7 and accompanying notes. ## **Respective responsibilities of trustees and examiner** The charity’s trustee is responsible for the preparation of the accounts. The charity’s trustee considers that an audit is not required for this year under section 144(2) of the Charities Act 2011 (The Charities Act) and that an independent examination is needed. It is my responsibility to: - examine the accounts under section 145 of the 2011 Act; - to follow the procedures laid down in the General Directions given by the Charity Commission under section 145(5)(b) of the Charities Act, and - to state whether particular matters have come to my attention. ## **Basis of independent examiner’s report** My examination was carried out in accordance with the general Directions given by the Charity Commission. An examination includes a review of the accounting records kept by the charity and a comparison of the accounts presented with those records. It also includes consideration of any unusual items or disclosures in the accounts, and seeking explanations from you as trustee for any such matters. The procedures undertaken do not provide all the evidence that would be required in an audit, and consequently no opinion is given as to whether the accounts present a ‘true and fair view’ and the report is limited to those matters set out in the statement below. ## **Independent examiner’s statement** In connection with my examination, no material matters have come to my attention which gives me cause to believe that in any material respect: - The accounting records were not kept in accordance with section 130 of the Charities Act; or - The accounts did not accord with the accounting records; or - The accounts did not comply with the applicable requirements concerning the form and content of the accounts set out in the Charities (Accounts and Reports) Regulations 2008 other than in any requirement that the accounts give a “true and fair” view which is not a matter considered as part of an independent examination. I have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached. ## Signed on Original P A Nicholls MBE MAAT 5 Nursery Road Havant Hants PO9 3BG 17 March 2021 ## **HMS NELSON LEISURE & AMENITIES FUND** ## **Registered Charity No 1128785** ## **BALANCE SHEET** ## **31 December 2020** ## ASSETS |Fixed Assets
_Note_
_Tangible Assets_
Property
_7_
_Investments_
Quilter Cheviot Investments
_2_
CCLA COIF Fixed Interest Account
National Savings Investment Bonds
Current Assets
Miscellaneous Debtors
_8_
Prepayments
_8A_
Cash & Floats
Current Accounts
Charities Deposit Account
Total Current Assets
LIABILITIES
Miscellaneous Creditors
_9_
Holding Funds
_9A_
VAT
Total Current Liabilities
Net Current Assets
**Net Assets**
Represented by:
General Purpose Fund
Designated Funds:
Refurbishment/Replacement Funds:
Narrowboat EMMA V
Narrowboat ANDREW II
Narrowboat TRAFALGAR
Office Equipment|119,554.94
£
677,473.00
£
135,640.95
£
35,000.00
£|_139,078.76_
_£_
_685,874.00_
_£_
_131,288.27_
_£_
_35,000.00_
_£_
967,668.89
£
_991,241.03_
_£_
_8,933.00_
_£_
_9,588.00_
_£_
_6,558.40_
_£_
_18,975.38_
_£_
_71,179.86_
_£_
_115,234.64_
_£_
_5,556.83_
_£_
_28,170.50_
_£_
_860.50_
_£_
_34,587.83_
_£_
72,463.25
£
_80,646.81_
_£_
**1,040,132.14**
**£**
**_1,071,887.84_**
**_£_**
780,041.14
£
_834,588.84_
_£_
_103,531.00_
_£_
_68,668.00_
_£_
_61,600.00_
_£_
_3,500.00_
_£_
260,091.00
£
_237,299.00_
_£_
**1,040,132.14**
**£**
**_1,071,887.84_**
**_£_**
_31-Dec-19_|_139,078.76_
_£_
_685,874.00_
_£_
_131,288.27_
_£_
_35,000.00_
_£_
967,668.89
£
_991,241.03_
_£_
_8,933.00_
_£_
_9,588.00_
_£_
_6,558.40_
_£_
_18,975.38_
_£_
_71,179.86_
_£_
_115,234.64_
_£_
_5,556.83_
_£_
_28,170.50_
_£_
_860.50_
_£_
_34,587.83_
_£_
72,463.25
£
_80,646.81_
_£_
**1,040,132.14**
**£**
**_1,071,887.84_**
**_£_**
780,041.14
£
_834,588.84_
_£_
_103,531.00_
_£_
_68,668.00_
_£_
_61,600.00_
_£_
_3,500.00_
_£_
260,091.00
£
_237,299.00_
_£_
**1,040,132.14**
**£**
**_1,071,887.84_**
**_£_**
_31-Dec-19_| |---|---|---|---| ||6,145.50
£
9,299.00
£
777.74
£
21,231.99
£
75,580.07
£||| ||113,034.30
£||| ||5,575.73
£
37,876.39
£
(2,881.07)
£||| ||40,571.05
£||| ||111,837.00
£
74,354.00
£
70,400.00
£
3,500.00
£||| ||||**_1,071,887.84_**
**_£_**| ||||_834,588.84_
_£_
_237,299.00_
_£_| ||||| ||||**_1,071,887.84_**
**_£_**| ## Signed on Original Approved on 17 March 2021 Commodore J J Bailley ADC Royal Navy Sole Managing Trustee 1 NEL-LAFDec20BZBALANCE SHEET ## **HMS NELSON LEISURE & AMENITIES FUND** ## **STATEMENT OF FINANCIAL ACTIVITIES** ## **For the year ended 31 December 2020** |_Notes_
**Income from:**
Donations & Grants
Charitable Activities
Other Trading Activities
Investment Income
Total Income
_3_
**Expenditure on:**
Raising Funds
Charitable Activities
Total expenditure
4
Net Incoming/(Outgoing) resources
Previous Year Adjustments
Increase/(Decrease) in Value - Investments
Net Movement in Funds
Total Funds brought forward
Net Movement of funds
**Net Assets**|£
£
£| |---|---| ||£| 2 NEL-LAFDec20BZSOFA Sum ## **HMS NELSON LEISURE & AMENITIES FUND** ## **Notes to the Financial Statements dated 31 Dec 20** ## **Note 1 - Accounting policies** a. The financial statements are prepared under the historic cost convention (as modified by the revaluation of fixed asset investments) and in accordance with applicable accounting standards: Charities Statement of Recommended Practice (FRS 102) effective 2019 and the provisions of the Charities Act 2011. Significant policies adopted are: ## Incoming resources - a. Donations are included in the Statement of Financial Activities (SOFA) when the LAF becomes entitled to the donation or grant and it is reasonably certain that it will be received. - b. Incoming resources from fund raising are reported gross in the SOFA - c. Intangible income is not included in the accounts. - d. The LAF receives no unpaid volunteer help. - e. Investment income is included in the accounts when receivable. ## Expenditure and liabilities a. Liabilities are recognised as soon as there is a legal or constructive obligation committing the LAF to the expenditure. b. Administration costs are not apportioned as the tasks are wide ranging in support of leisure and amenities and include the maintenance of the Central Fund and Trophy Fund. ## Assets a. Tangible fixed assets are capitalised if they can be used for more than one year and cost at least £500. They are valued at cost or a reasonable value on receipt. The LAF does not have a policy of revaluation. Depreciation is monthly, straight line and over the estimated life of the item. - b. Property acquired through the Accumulated Welfare Fund is held at zero value. - c. Investments on a recognised stock exchange are valued at market value at the date of the Balance Sheet or at best estimate of market value. ## **Note 2 - Investments** |Quilter Cheviott Managed
Market Value at beginning of year
685,874.00
£
Gains/(loss) on Revaluation
(8,401.00)
£
Market value at end of year
677,473.00
£|Fixed Interest
Totals
131,288.27
£
817,162.27
£
4,352.68
£
(4,048.32)
£
135,640.95
£
813,113.95
£| |---|---| (Purchase price 1997 - Equities & Bonds) £ 424,844.71 (Purchase price 2011 - Fixed Interest) £ 120,000.00 3 NEL-LAFDec20BZNotes ## **HMS NELSON LEISURE & AMENITIES FUND** |**Note 3 - Income**
_Donations & Grants_
Mess Sports Contributions
Other Grants/Donations
Gainshare
_Charitable Activities_
Narrowboats
Laundry
Jetwash
Lodge
Family Flats
AT Equipment
Cleaning Machines
Misc Income
_Other Trading Activities_
Gaming & Amusement Machines
Sports User Passes
_Investment Income:_
Fixed Interest Deposit
Equity & Bond Income
NSIB Income
Charities Deposit A/C
**Total Income**|6,600.00
£
_6,600.00_
_£_
-
£
_32,000.00_
_£_
17,937.50
£
_28,700.00_
_£_
24,537.50
£
_67,300.00_
_£_
24,292.42
£
_52,760.78_
_£_
3,093.68
£
_5,633.45_
_£_
3,103.08
£
_5,359.64_
_£_
6,194.80
£
_15,614.18_
_£_
2,629.41
£
_4,206.26_
_£_
209.52
£
_-_
_£_
283.25
£
_-_
_£_
184.77
£
_239.83_
_£_
39,990.93
£
_83,814.14_
_£_
1,423.02
£
_13,863.32_
_£_
4,052.50
£
_7,037.50_
_£_
5,475.52
£
_20,900.82_
_£_
4,247.44
£
_4,247.44_
_£_
17,643.86
£
_19,979.86_
_£_
391.61
£
_402.53_
_£_
152.77
£
_640.91_
_£_
22,435.68
£
_25,270.74_
_£_
92,439.63
£
_197,285.70_
_£_
2020
_2019_| |---|---| 4 NEL-LAFDec20BZSOFAI |**Note 4 - Expenditure**
_Raising Funds_
Sports User Pass Insurance
_Charitable Activities_
Operating Costs
Narrowboats
18,880.15
£
Narrowboat Depreciation
10,238.28
£
Lodge
8,170.05
£
Lodge Depreciation
8,000.00
£
Family Flats
491.42
£
Family Flat Phase II Build
-
£
Jetwash Nelson
1,496.21
£
LAF Van
2,625.38
£
TV Hire, Repairs etc
3,527.43
£
Sports
5,638.75
£
Christmas Extras
2,439.10
£
Families Day/Halloween
976.07
£
Covid Food
1,424.85
£
JR Mess Refurbishment
1,397.51
£
Wardroom Grants
-
£
Loan Bike Scheme - Maintenance
3,916.80
£
Minor Grants Paid
2,452.32
£
Insurance & Trophy Hire
1,375.60
£
Governance Costs
Examination of Accounts
1,927.00
£
HR Advice
610.00
£
Support Costs
Salaries & Nl & Pensions
38,330.26
£
Office Expenses
4,051.70
£
Misc Expenses
602.77
£
Minor Depreciation
1,285.54
£
**Total resources expended**
**Note 4A - Major Grants - Above £1000**
Junior Ratings Mess
1,397.51)
(£|18,880.15
£
10,238.28
£
8,170.05
£
8,000.00
£
491.42
£
-
£
1,496.21
£
2,625.38
£
3,527.43
£
5,638.75
£
2,439.10
£
976.07
£
1,424.85
£
1,397.51
£
-
£
3,916.80
£
2,452.32
£
1,375.60
£
1,927.00
£
610.00
£
38,330.26
£
4,051.70
£
602.77
£
1,285.54
£|59.99
£
_1,452.69_
_£_
_48,465.29_
_£_
_8,696.34_
_£_
_11,369.38_
_£_
_11,933.24_
_£_
_791.07_
_£_
_13,745.00_
_£_
_2,984.66_
_£_
_1,153.52_
_£_
_5,705.82_
_£_
_9,625.96_
_£_
_3,511.54_
_£_
_22,551.88_
_£_
_-_
_£_
_5,000.00_
_£_
_4,083.98_
_£_
_2,760.00_
_£_
_8,041.19_
_£_
_1,392.70_
_£_
_2,316.00_
_£_
_-_
_£_
_45,547.02_
_£_
_4,317.80_
_£_
_-_
_£_
119,857.19
£
_213,992.39_
_£_
119,917.18
£
_215,445.08_
_£_
2020
_2019_| |---|---|---| |||| 5 ## **Note 5 - Paid Employees** |||||_Previous Year_|_Previous Year_| |---|---|---|---|---|---| |a.|Gross Wages and salaries:|£|34,683
|_£_|_41,232_
| ||Employers National Insurance:|£|727
|_£_|_593_
| ||Pension (Money purchase scheme) Contributions:|£|2,920
|_£_|_3,722_
| - b. The LAF had one full time employee who managed and administered the fund. and a part time assistant (until Mar 20) - c. No employee earns more than £60,000 per annum ## **Note 6 -Trusteees and Other Related Parties** b. There are no amounts due to or from the sole Managing Trustee c. The sole Managing Trustee is also the sole Managing Trustee of the Wardroom HMS Nelson and the WO & SR Mess HMS Nelson. These funds pay sums to the LAF as sport contributions. In addition the messes occasionally bid for grants from the LAF. ## **Note 7 - Tangible Fixed Assets - Property Account** |Total value at 1 Jan 20
Depreciation
Property Value at 31 Dec 20||Narrowboats
84,858.13
£
£
(10,238.28)
£
£|Lodge
52,199.98

(8,000.00)|Sports/Other
Total
2,020.65
£
139,078.76
£
(1,285.54)
£
(19,523.82)
£| |---|---|---|---|---| |||74,619.85
£
£|44,199.98|735.11
£
119,554.94
£| ## **Note 8 - Miscellaneous Debtors (all falling due within one year)** |Gainshare Oct-Dec
JR Bar Loan
Canal Trust Credit|3,587.50
£
1,000.00
£
1,558.00
£| |---|---| ||6,145.50
£| ## **Note 8A - Prepayments** |Road Tax
Narrowboat Licences
Narrowboat Mooring Fees
Lodge Site Fees
Sage Cover
Insurances|221.00
£
1,167.00
£
3,795.00
£
2,502.00
£
93.00
£
1,521.00
£| |---|---| ||9,299.00
£| **Note 9 - Miscellaneous Creditors** (All falling due within one year) |Lodge prepaid
Narrowboat Deposits & Prepaid
Pensions
GM Rent
Jetwash
PNIE|679.00
£
3,270.83
£
220.62
£
812.28
£
200.00
£
393.00
£| |---|---| ||5,575.73
£| 6 NEL-LAFDec20BZNotes2 ## **Note 9A - Temporary Holding Funds** |JR Mess
Boxing Event
Christmas Cards
Covid RBL
Twickenham
Nelson Angling Club
Southdowns Trek
Engineers Golf
F&G Officers Dinner
SM Dinner Fund
Naval Servicewomen's Network
Medical Centre
Kings Camp
PorFlot
Holding Fund (Non LAF Grants)|268.11
£
216.94
£
67.50
£
2,306.86
£
9.05
£
412.10
£
611.24
£
2.12
£
3,977.76
£
1,204.51
£
113.96
£
1,187.18
£
232.60
£
150.00
£
27,116.46
£| |---|---| ||37,876.39
£| ## **Note 10 - Endowment or Restricted Income Funds** ## None held ## **Note 11 - Other Information** - a. The LAF does not have any material commitments not provided for in the accounts - b. The LAF has not given any guarantees to any third party that could be called on at the year end. - d. The LAF did not make any ex gratia payments during the year. ## **Declarations** - a. The Trustee has not changed the year end date nor the length of the financial year - b. The LAF has 4 designated funds. These are: |Refurbishment/Replacement|Funds:|Funds:| |---|---|---| |Narrowboat EMMA V|£|111,837.00
| |Narrowboat ANDREW II|£|74,354.00
| |Narrowboat TRAFALGAR|£|70,400.00
| |Office Equipment|£|3,500.00| ||£|260,091.00| - c. All the LAF's operations are continuing operations. - d. The LAF has no intangible assets (other than use of MOD office and club space) - e. There were no interfund loans outstanding at the balance sheet date. - f. None of the LAF's functional assets have been revalued during the year and the LAF does not have a policy of revaluation of these assets. - g. The LAF has no material fixed assets which have not been capitalised and included in the Balance Sheet. 7 NEL-LAFDec20BZNotes3 ## PN INDEPENDENT EXAMINATIONS 5 Nursery Road Havant Hants PO9 3BG  07801 064450 Naval Base Commander HM Naval Base Portsmouth 3 Feb 21 ## **HMS NELSON LEISURE & AMENITIES FUND – ANNUAL EXAMINATION OF ACCOUNTS – 31 DEC 20** 1. The examination of HMS Nelson’s Leisure and Amenities Fund for the year ending 31 Dec 20 has been completed satisfactorily. The annual accounts and a draft Trustee’s Annual Report (TAR) are enclosed. After approval the online annual report to the Charity Commission should be completed including uploading PDF versions of these accounts and the TAR. 2. Investments The Quilter Cheviott investments had recovered much of the losses seen in Mar, although not quite back to the level seen at the post-election peak of the market seen in Dec 19. The net loss was £8.4K equivalent to a fall of 1.2% over the year. In contrast the Fixed Interest bonds gained £4.4K (3.3%). ## 3. Income - Dividends and interest paid from the bonds and deposit accounts had fallen from the £25K seen last year to the £22.3K in this year. - BAe cut gainshare by 50% from Apr 20 leading to a fall of income of £10.8K. - Gym user pass income had fallen from £7K to £4K. - Gaming machine income had fallen to £1.4K compared to £13.9K last year. Indeed, in the second half of the year the LAF ended up owing money as rent exceeded takings. ## 4. ## Trading Areas - Narrowboat hires had fallen by more than half but they made an operating profit of £5.4K compared to £4.3K in 2019. - The lodge made an operating loss of £2K (a profit of £4.2K in 2019). document2576109532242799975.doc - The family flats made a profit of £2K (£2.6K in 2019). - The jet wash was less busy this year and made a profit of £2.4K (£4K in 2019). - Profits in the laundry were £3K (£5.6K in 2019). There were no expenses. ## 5. Expenditure: - Sports expenditure totalled £5.6K compared to £9.6K seen in the previous year. - The cost of TV hires and repairs had decreased to £3.5K from £5.7K. - The van cost £2.6K in maintenance and insurance charges. There were no depreciation costs as the van had a book value of zero. - The loan bike maintenance scheme cost the LAF £3.9K. 6. Christmas Cards This was a scheme operated outside the LAF business. It was funded by a £600 RNRMC grant and a £501 grant from the LAF. Sales are held to one side in a separate fund. Unfortunately, this scheme was launched rather late in the year and only £67 in sales have been received, although more may be waiting to come in. As a result, a large residual stock of cards is held and it is intended that when these are sold next Christmas money can then be returned to the RNRMC and LAF. ## Summary 7. The activities of the fund had been curtailed for much of the year by the Covid 19 situation. The value of the fund had fallen by £31.5K There were four main reasons: - An overall fall in the market value of investment of £4K. - A reduction in gainshare income of £10.8K. - The Bike Scheme cost £3.9K. - A reduction in gaming income of £12.5K. 8. The fund was worth £1.04M of which £848K was held in long term investments. Property assets, mainly the three narrowboats and the lodge, had a book value of nearly £120K. The current and deposit accounts held nearly £97K which easily covered liabilities of £40K. document2576109532242799975.doc P A Nicholls PN Independent Examinations document2576109532242799975.doc