COMPANY REGISTRATION NUMBER: 7073538 CHARITY REGISTRATION NUMBER: 1134918
MW (RH) Foundation Company Limited by Guarantee Financial Statements
30 November 2020
HAFFNER HOFF LTD
Accountants & statutory auditor 2nd Floor - Parkgates Bury New Road Prestwich Manchester M25 0TL
MW (RH) Foundation
Company Limited by Guarantee
Financial Statements
Year ended 30 November 2020
| Pages | |
|---|---|
| Trustees' annual report (incorporating the director's report) | 1 to 7 |
| Independent auditor's report to the trustees | 8 to 11 |
| Statement of financial activities (including income and | |
| expenditure account) | 12 |
| Statement of financial position | 13 |
| Statement of cash flows | 14 |
| Notes to the financial statements | 15 to 25 |
MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report)
Year ended 30 November 2020
The trustees, who are also the directors for the purposes of company law, present their report and the financial statements of the charity for the year ended 30 November 2020.
Reference and administrative details
| Registered charity name | MW (RH) Foundation |
|---|---|
| Charity registration number | 1134918 |
| Company registration number | 7073538 |
| Principal office and registered | 2nd Floor - Parkgates |
| office | Bury New Road |
| Prestwich | |
| Manchester | |
| M25 0TL | |
| The trustees | |
| Mrs R Halpern | |
| J Halpern | |
| A Halpern | |
| Auditor | Haffner Hoff Ltd |
| Accountants & statutory auditor | |
| 2nd Floor - Parkgates | |
| Bury New Road | |
| Prestwich | |
| Manchester | |
| M25 0TL | |
| Bankers | Barclays Bank Plc |
| Manchester Cheetham Hill | |
| Cheetham Hill | |
| M8 | |
| Handelsbanken | |
| 4 Brewery Yard | |
| Deva Centre Office Park | |
| Manchester | |
| M3 7BD |
- 1 -
MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Structure, governance and management
MW (RH) Foundation is constituted by Memorandum and Articles of Association and is a company limited by guarantee. It was incorporated on 12 November 2009 as a company and the company number is 7073538. It was registered as a charity on 15 March 2010 with a charity number 1134918.
There is no chief executive officer. The day to day affairs are undertaken by the property and accounts managers on behalf of the trustees. All major decisions are taken collectively by the trustees and all the trustees give of their time freely. The trustees are unpaid and details of any related party transactions are disclosed as applicable in the notes to the accounts. The arrangements for setting the pay of the charity’s employees are the sole domain of the trustees.
There are no policies for the induction or training of new trustees.
Risk review
The Trustees have assessed the major risks to which the charity is exposed, in particular those related to the operations and finances of the Trust, and are satisfied that systems are in place to manage our exposure to the major risks.
The risks faced by the trust are principally operational risks from ineffective grant making. These risks are managed by the trustees researching potential beneficiaries before granting donations.
Report back and review procedures strengthen these safeguards to ensure public benefit is achieved from all grants.
Risk management
The Trustees are responsible for the management of the risks faced by the Charity. A formal review of the charity's risk management processes is undertaken on an annual basis.
The key controls used by the charity include:
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Comprehensive strategic planning and budgeting;
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Established organisational structure and lines of reporting;
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Clear authorisation and approval levels.
Through the risk management processes established for the Charity, the Trustees are satisfied that the major risks identified have been adequately mitigated where necessary. It is recognised that systems can only provide reasonable but not absolute assurance that major risks have been adequately managed.
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MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Objectives and activities
The objects of the charity are: (1) For the public benefit to promote the education of people of all ages around the world in such ways as the charity trustees think fit, including awarding to such persons scholarships, maintenance allowances or grants; or by grants to charities or other organisations worldwide that provide education; (2) The prevention or relief of poverty or financial hardship anywhere in the world by providing: grants or loans to individuals in need and/or charities, or other organisations working to prevent or relieve poverty or financial hardship; (3) To advance the Orthodox Jewish religion worldwide for the benefit of the public in accordance with the principles of the Code of Jewish Law (Shulchan Aruch).
Public benefit
The trustees confirm that they have referred to the guidance contained in the Charity Commission's general guidance on public benefit and in particular to its supplementary public benefit guidance on advancing education when reviewing the charity's aims and objectives and in planning future activities and setting grant making policy for the year.
Grant making policy
The charity is funded by donations and investment income. The charity gives out grants in line with the above objects.
There were no grants paid to individuals during the year.
Grants made during the year to institutions are as detailed in the accounts.
The application of the funds by way of grants to either institutions or individuals and is almost always to institutions.
The trustees consider they have met the public benefit test and outline these achievements below.
The trustees measure the success of achieving the stated aims by the number and value of grants paid out for each object. The grants paid out in the year are detailed in the notes to the accounts and the trustees consider they have met their aims successfully this year.
The trustees consider the shorter term aims to be similar to the longer term aims and assess the achievement of the charity in the same way.
Strategic report
The following sections for achievements and performance and financial review form the strategic report of the charity.
- 3 -
MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Achievements and performance
The charity received £616,161 in donations during the year and paid out £416,247 by way of grants and support costs. These grants were made in line with the stated objects of the charity and relate to educational purposes as well as relief of poverty purposes.
The charity has investment income receivable from investment property for the year amounting to £633,296. The trustees consider the return on the investments to be appropriate for the risk associated with the investments. The trustees are also conscious of capital growth that could enhance the returns yet further. Costs associated with management of these investments amounted to £366,913.
The charity incurred governance costs comprised of professional fees.
All other office costs are borne by a local benefactor and the trustees wish to record their appreciation to the benefactor for the free use of their offices.
There were no material fundraising costs during the year.
Related party transactions are disclosed as applicable in the notes to the accounts.
There was an overall net income and movement of funds for the year amounting to £411,178 after revaluation losses.
The trustees revalued part of the investment portfolio during the year. The resulting loss of £25,000 was due to a disposal of a property within one of the Associate undertakings. The net proceeds were donated to the charity during the year and this revaluation is a correction to the fair value of the portfolio. There was a further revaluation adjustment of £30,199 to account for the share of the property owned by Colmac Assets Ltd. The total revaluation loss of £55,119 is disclosed on the face of the SOFA.
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MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Financial review
Investment performance
The investments of the charity have all performed reasonably well in the year. The gross investment return is 7%.
The trustees consider this acceptable when compared with returns available on deposits in any of the banking institutions. These investment returns have been consistent for a number of years and are not at the expense of any exposure of loan to value covenants that would put these investments at risk.
The trustees feel that the activity reflects the profile and standing within the local community. The impact for future year's expenditure is self evident and the trustees would like to record their appreciation for all the financial support received from benefactors during the course of the year.
Coronavirus
The trustees have considered the impact of coronavirus on the charity and specifically on the value of the investment properties. The trustees have taken advice and consider it too early to reduce the value of the investment property as there are no material indications yet to suggest a reduction in the values. This may change in the coming months and will be reported on next year.
Reserves policy
The Unrestricted Fund represents the unrestricted funds arising from past operating results.
The Trustees are satisfied that the balance of the Fund is an acceptable level of reserves given the nature of revenue receipts against grants payable.
In considering the financial obligations of the charity, the trustees have resolved to maintain a minimum reserve, being the current assets of the charity.
The trustees have considered the fair (market) value of the investment property. The trustees consider the holding value to be the fair (market) value.
The trustees consider that the year was acceptable in terms of income generated from its investment and grants paid out. The trustees are delighted to have made many valuable contributions to the community as a result of these donations and hope to be able to do so for many years to come.
The free reserves, being the net current assets of the charity, stand at £17,629, all of which are unrestricted. 2019 £(110,709).
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MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Plans for future periods
The trustees plan to continue donating and investing to raise funds for projects in line with the Memorandum & Articles of Association and pursue those objectives and projects with all the resources available to the charity.
PRINCIPAL RISKS AND UNCERTAINTIES
The Trustees have assessed the major risks to which the charity is exposed, in particular those related to the operations and finances of the Trust. These risks include macro economic factors governing the whole economy that could expose tenants and thereby put the value of the investment properties at risk with the associated knock on effect with lenders covenants. Additionally, the charity may be exposed to interest rate increases with reference to loans and their repayment.
Other risks faced by the trust include operational risks from ineffective grant making. These risks are managed by the trustees researching potential beneficiaries before granting donations.
Report back and review procedures strengthen these safeguards to ensure public benefit is achieved from all grants paid out.
The trustees are satisfied that systems are in place to manage the exposure to the above major risks.
Trustees' responsibilities statement
The trustees, who are also directors for the purposes 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 charity trustees to prepare financial statements for each year which give a true and fair view of the state of affairs of the charitable company and the incoming resources and application of resources, including the income and expenditure, for that period.
In preparing these financial statements, the trustees are required to:
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select suitable accounting policies and then apply them consistently;
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observe the methods and principles in the applicable Charities SORP;
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make judgments and accounting estimates that are reasonable and prudent;
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state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in business.
The trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charity's transactions and 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.
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MW (RH) Foundation
Company Limited by Guarantee
Trustees' Annual Report (Incorporating the Director's Report) (continued)
Year ended 30 November 2020
Auditor
Each of the persons who is a trustee at the date of approval of this report confirms that:
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so far as they are aware, there is no relevant audit information of which the charity's auditor is unaware; and
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they have taken all steps that they ought to have taken as a trustee to make themselves aware of any relevant audit information and to establish that the charity's auditor is aware of that information.
The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
The trustees' annual report and the strategic report were approved on 15 November 2021 and signed on behalf of the board of trustees by:
J Halpern Trustee
- 7 -
MW (RH) Foundation
Company Limited by Guarantee
Independent Auditor's Report to the Trustees of MW (RH) Foundation
Year ended 30 November 2020
Opinion
We have audited the financial statements of MW (RH) Foundation (the 'charity') for the year ended 30 November 2020 which comprise the statement of financial activities (including income and expenditure account), statement of financial position, statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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:
-
give a true and fair view of the state of the charity's affairs as at 30 November 2020 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended;
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have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice;
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have been prepared in accordance with the requirements of the Companies Act 2006 and the Charities Act 2011.
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 charity 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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
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the trustees' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
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the trustees have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the charity's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
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MW (RH) Foundation
Company Limited by Guarantee
Independent Auditor's Report to the Trustees of MW (RH) Foundation (continued)
Year ended 30 November 2020
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. 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the trustees' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
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the trustees' report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the charity and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities Act 2011 requires us to report to you if, in our opinion:
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adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
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the financial statements are not in agreement with the accounting records and returns; or
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certain disclosures of trustees' remuneration specified by law are not made; or
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we have not received all the information and explanations we require for our audit.
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MW (RH) Foundation
Company Limited by Guarantee
Independent Auditor's Report to the Trustees of MW (RH) Foundation (continued)
Year ended 30 November 2020
Responsibilities of trustees
As explained more fully in the trustees' responsibilities statement, the trustees (who are also the directors for the purposes 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 charity'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 charity 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.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
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Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control.
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Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the trustees.
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Conclude on the appropriateness of the trustees' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the charity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the charity to cease to continue as a going concern.
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Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
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MW (RH) Foundation
Company Limited by Guarantee
Independent Auditor's Report to the Trustees of MW (RH) Foundation (continued)
Year ended 30 November 2020
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Use of our report
This report is made solely to the charity's trustees, as a body, in accordance with section 144 of the Charities Act 2011 and regulations made under section 154 of that Act. Our audit work has been undertaken so that we might state to the charity's trustees 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 charity and the charity's trustees as a body, for our audit work, for this report, or for the opinions we have formed.
Dov Schwarz FCCA (Senior Statutory Auditor)
2nd Floor - Parkgates Bury New Road Prestwich Manchester M25 0TL
For and on behalf of Haffner Hoff Ltd Accountants & statutory auditor
15 November 2021
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MW (RH) Foundation
Company Limited by Guarantee
Statement of Financial Activities (including income and expenditure account)
Year ended 30 November 2020
| 2020 | 2020 | 2019 | ||
|---|---|---|---|---|
| Unrestricted | ||||
| funds | Total funds | Total funds | ||
| Note | £ | £ | £ | |
| Income and endowments | ||||
| Donations and legacies | 5 | 616,161 | 616,161 | 744,623 |
| Investment income | 6 | 633,296 | 633,296 | 631,856 |
| ----------------------------------------- | ----------------------------------------- | ----------------------------------------- | ||
| Total income | 1,249,457 | 1,249,457 | 1,376,479 | |
| ========================================= | ========================================= | ========================================= | ||
| Expenditure | ||||
| Expenditure on raising funds: | ||||
| Investment management costs | 7 | 366,913 | 366,913 | 158,666 |
| Expenditure on charitable activities | 8,9 | 416,247 | 416,247 | 503,994 |
| ----------------------------------------- | ----------------------------------------- | ----------------------------------------- | ||
| Total expenditure | 783,160 | 783,160 | 662,660 | |
| ========================================= | ========================================= | ========================================= | ||
| Net Gains/(losses) on revaluation of investment | ||||
| property | 12 | (55,119) | (55,119) | (636,779) |
| ----------------------------------------- | ----------------------------------------- | ----------------------------------------- | ||
| Net income and net movement in funds | 411,178 | 411,178 | 77,040 | |
| ========================================= | ========================================= | ========================================= | ||
| Reconciliation of funds | ||||
| Total funds brought forward | 3,724,191 | 3,724,191 | 3,647,151 | |
| ----------------------------------------- | ----------------------------------------- | ----------------------------------------- | ||
| Total funds carried forward | 4,135,369 | 4,135,369 | 3,724,191 | |
| ========================================= | ========================================= | ========================================= |
The statement of financial activities includes all gains and losses recognised in the year. All income and expenditure derive from continuing activities.
The notes on pages 15 to 25 form part of these financial statements.
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MW (RH) Foundation
Company Limited by Guarantee
Statement of Financial Position
30 November 2020
| 2020 | 2019 | |||
|---|---|---|---|---|
| Note | £ | £ | £ | |
| Fixed assets | ||||
| Investments | 16 | 9,060,262 | 6,014,900 | |
| Current assets | ||||
| Debtors | 18 | 25,994 | 27,418 | |
| Cash at bank and in hand | 277,370 | 66,025 | ||
| -------------------------------- | ---------------------------- | |||
| 303,364 | 93,443 | |||
| Creditors: amounts falling due within one year | 19 | (285,735) | (204,152) | |
| -------------------------------- | -------------------------------- | |||
| Net current assets | 17,629 | (110,709) | ||
| ----------------------------------------- | ----------------------------------------- | |||
| Total assets less current liabilities | 9,077,891 | 5,904,191 | ||
| Creditors: amounts falling due after more than | ||||
| one year | 20 | (4,942,522) | (2,180,000) | |
| ----------------------------------------- | ----------------------------------------- | |||
| Net assets | 4,135,369 | 3,724,191 | ||
| ========================================= | ========================================= | |||
| Funds of the charity | ||||
| Unrestricted funds | 4,135,369 | 3,724,191 | ||
| ----------------------------------------- | ----------------------------------------- | |||
| Total charity funds | 21 | 4,135,369 | 3,724,191 | |
| ========================================= | ========================================= |
These financial statements were approved by the board of trustees and authorised for issue on 15 November 2021, and are signed on behalf of the board by:
J Halpern Trustee
The notes on pages 15 to 25 form part of these financial statements.
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MW (RH) Foundation
Company Limited by Guarantee
Statement of Cash Flows
Year ended 30 November 2020
| 2020 | 2019 | |
|---|---|---|
| £ | £ | |
| Cash flows from operating activities | ||
| Net income | 411,178 | 77,040 |
| Adjustments for: | ||
| Net Gains/(losses) on revaluation of investment property | 55,119 | 636,779 |
| Dividends, interest and rents from investments | (633,227) | (631,766) |
| Other interest receivable and similar income | (69) | (90) |
| Accrued (income)/expenses | (4,440) | 5,460 |
| Changes in: | ||
| Trade and other debtors | 1,424 | (21,318) |
| Trade and other creditors | 130,748 | 102,741 |
| -------------------------------- | -------------------------------- | |
| Cash generated from operations | (39,267) | 168,846 |
| Interest received | 69 | 90 |
| ---------------------------- | -------------------------------- | |
| Net cash (used in)/from operating activities | (39,198) | 168,936 |
| ============================ | ================================ | |
| Cash flows from investing activities | ||
| Dividends, interest and rents from investments | 633,227 | 631,766 |
| Purchases of other investments | (3,070,362) | (792,969) |
| Proceeds from sale of other investments | (30,119) | - |
| ----------------------------------------- | -------------------------------- | |
| Net cash used in investing activities | (2,467,254) | (161,203) |
| ========================================= | ================================ | |
| Cash flows from financing activities | ||
| Proceeds from borrowings | 2,717,797 | 32,000 |
| ----------------------------------------- | -------------------------------- | |
| Net cash from financing activities | 2,717,797 | 32,000 |
| ========================================= | ================================ | |
| Net increase/(decrease) in cash and cash equivalents | 211,345 | 39,733 |
| Cash and cash equivalents at beginning of year | 66,025 | 26,292 |
| -------------------------------- | -------------------------------- | |
| Cash and cash equivalents at end of year | 277,370 | 66,025 |
| ================================ | ================================ |
The notes on pages 15 to 25 form part of these financial statements.
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MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements
Year ended 30 November 2020
1. General information
The charity is a public benefit entity and a private company limited by guarantee, registered in England and Wales and a registered charity in England and Wales. The address of the registered office is 2nd Floor - Parkgates, Bury New Road, Prestwich, Manchester, M25 0TL.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland', the 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) (Charities SORP (FRS 102)) and the Companies Act 2006.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through income or expenditure.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Going concern
The trustees have given consideration to the impact of the coronavirus pandemic on the charity and refer to this in their report in the Financial Review section.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements did not require management to make judgements, estimates or assumptions that affect the amounts reported besides the valuation of fixed asset investments at the year end.
Fund accounting
Unrestricted funds held by the charity are funds that can be used in accordance with the charitable objects at the discretion of the trustees.
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MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
3. Accounting policies (continued)
Incoming resources
All incoming resources are included in the statement of financial activities when entitlement has passed to the charity; it is probable that the economic benefits associated with the transaction will flow to the charity and the amount can be reliably measured. The following specific policies are applied to particular categories of income:
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income from donations or grants is recognised when there is evidence of entitlement to the gift, receipt is probable and its amount can be measured reliably.
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legacy income is recognised when receipt is probable and entitlement is established.
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income from donated goods is measured at the fair value of the goods unless this is impractical to measure reliably, in which case the value is derived from the cost to the donor or the estimated resale value. Donated facilities and services are recognised in the accounts when received if the value can be reliably measured. No amounts are included for the contribution of general volunteers.
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income from contracts for the supply of services is recognised with the delivery of the contracted service. This is classified as unrestricted funds unless there is a contractual requirement for it to be spent on a particular purpose and returned if unspent, in which case it may be regarded as restricted.
Resources expended
Expenditure is recognised on an accruals basis as a liability is incurred. Expenditure includes any VAT which cannot be fully recovered, and is classified under headings of the statement of financial activities to which it relates:
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expenditure on raising funds includes the costs of all fundraising activities, events, noncharitable trading activities, and the sale of donated goods.
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expenditure on charitable activities includes all costs incurred by a charity in undertaking activities that further its charitable aims for the benefit of its beneficiaries, including those support costs and costs relating to the governance of the charity apportioned to charitable activities.
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other expenditure includes all expenditure that is neither related to raising funds for the charity nor part of its expenditure on charitable activities.
All costs are allocated to expenditure categories reflecting the use of the resource. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs are apportioned between the activities they contribute to on a reasonable, justifiable and consistent basis.
Investments
Unlisted equity investments are initially recorded at cost, and subsequently measured at fair value. If fair value cannot be reliably measured, assets are measured at cost less impairment.
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MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
3. Accounting policies (continued)
Investments (continued)
Listed investments are measured at fair value with changes in fair value being recognised in income or expenditure.
Investment property
Investment property is initially recorded at cost, which includes purchase price and any directly attributable expenditure.
Investment property is revalued to its fair value at each reporting date and any changes in fair value are recognised in income or expenditure.
If a reliable measure of fair value is no longer available without undue cost or effort for an item of investment property, it shall be transferred to tangible assets and treated as such until it is expected that fair value will be reliably measurable on an on-going basis.
Investments in associates
Investments in associates accounted for in accordance with the cost model are recorded at cost less any accumulated impairment losses.
Investments in associates accounted for in accordance with the fair value model are initially recorded at the transaction price. At each reporting date, the investments are measured at fair value, with changes in fair value taken through income or expenditure. Where it is impracticable to measure fair value reliably without undue cost or effort, the cost model will be adopted.
Dividends and other distributions received from the investment are recognised as income without regard to whether the distributions are from accumulated profits of the associate arising before or after the date of acquisition.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.
For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.
For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the charity are assigned to those units.
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MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
3. Accounting policies (continued)
Financial instruments
A financial asset or a financial liability is recognised only when the charity becomes a party to the contractual provisions of the instrument.
Basic financial instruments are initially recognised at the amount receivable or payable including any related transaction costs.
Current assets and current liabilities are subsequently measured at the cash or other consideration expected to be paid or received and not discounted.
Debt instruments are subsequently measured at amortised cost.
Where investments in shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in income and expenditure. All other such investments are subsequently measured at cost less impairment.
Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.
Other financial instruments are subsequently measured at fair value, with any changes recognised in the statement of financial activities, with the exception of hedging instruments in a designated hedging relationship.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised under the appropriate heading in the statement of financial activities in which the initial gain was recognised.
For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.
Any reversals of impairment are recognised immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
4. Limited by guarantee
MW (RH) Foundation is a registered charity and a company limited by guarantee that does not have any share capital. In the event of the charity being wound up, trustees are required to contribute an amount not exceeding £10.
- 18 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
5. Donations and legacies
| Unrestricted | Total Funds | Unrestricted | Total Funds | ||
|---|---|---|---|---|---|
| Funds | 2020 | Funds | 2019 | ||
| £ | £ | £ | £ | ||
| Donations | |||||
| Donations | 616,161 | 616,161 | 744,623 | 744,623 | |
| ================================ | ================================ | ================================ | ================================ | ||
| 6. | Investment income | ||||
| Unrestricted | Total Funds | Unrestricted | Total Funds | ||
| Funds | 2020 | Funds | 2019 | ||
| £ | £ | £ | £ | ||
| Income from investment properties | 633,227 | 633,227 | 331,766 | 331,766 | |
| Income from other investments | – | – | 300,000 | 300,000 | |
| Bank interest receivable | 69 | 69 | 90 | 90 | |
| -------------------------------- | -------------------------------- | -------------------------------- | -------------------------------- | ||
| 633,296 | 633,296 | 631,856 | 631,856 | ||
| ================================ | ================================ | ================================ | ================================ | ||
| 7. | Investment management costs |
| Unrestricted | Total Funds | Unrestricted | Total Funds | |
|---|---|---|---|---|
| Funds | 2020 | Funds | 2019 | |
| £ | £ | £ | £ | |
| Rent collection | 10,683 | 10,683 | 17,641 | 17,641 |
| Property repairs and maintenance | ||||
| charges | 36,140 | 36,140 | 35,319 | 35,319 |
| Other investment management costs | 37,555 | 37,555 | 8,919 | 8,919 |
| Interest payable | 114,125 | 114,125 | 82,017 | 82,017 |
| Insurance | 59,444 | 59,444 | 14,770 | 14,770 |
| Finance costs | 96,250 | 96,250 | – | – |
| Legal & Professional | 12,716 | 12,716 | – | – |
| -------------------------------- | -------------------------------- | -------------------------------- | -------------------------------- | |
| 366,913 | 366,913 | 158,666 | 158,666 | |
| ================================ | ================================ | ================================ | ================================ |
8. Expenditure on charitable activities by fund type
| Unrestricted | Total Funds | Unrestricted | Total Funds | |
|---|---|---|---|---|
| Funds | 2020 | Funds | 2019 | |
| £ | £ | £ | £ | |
| Charitable grants | 391,120 | 391,120 | 488,503 | 488,503 |
| Support costs | 25,127 | 25,127 | 15,491 | 15,491 |
| -------------------------------- | -------------------------------- | -------------------------------- | -------------------------------- | |
| 416,247 | 416,247 | 503,994 | 503,994 | |
| ================================ | ================================ | ================================ | ================================ |
Copies of the schedule of charitable grants can be obtained by applying in writing to the trustees at the registered office of the charity.
- 19 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
9. Expenditure on charitable activities by activity type
| Activities | ||||||
|---|---|---|---|---|---|---|
| undertaken | Grant funding |
Support |
Total funds | Total fund | ||
| directly | of activities | costs | 2020 | 2019 | ||
| £ | £ | £ | £ | £ | ||
| Charitable grants | 2,391 | 388,729 | 429 | 391,549 | 490,922 | |
| Governance costs | – | – | 24,698 | 24,698 | 13,072 | |
| ----------------------- | -------------------------------- | ---------------------------- | -------------------------------- | -------------------------------- | ||
| 2,391 | 388,729 | 25,127 | 416,247 | 503,994 | ||
| ======================= | ================================ | ============================ | ================================ | ================================ | ||
| 10. | Analysis of support costs | |||||
| Analysis of | ||||||
| support costs | Total 2020 | Total 2019 | ||||
| £ | £ | £ | ||||
| General office | 429 | 429 | 2,419 | |||
| Governance costs | 24,698 | 24,698 | 13,072 | |||
| ---------------------------- | ---------------------------- | ---------------------------- | ||||
| 25,127 | 25,127 | 15,491 | ||||
| ============================ | ============================ | ============================ | ||||
| 11. | Analysis of grants | |||||
| 2020 | 2019 | |||||
| £ | £ | |||||
| Grants to institutions | ||||||
| Community Grants | 162,418 | 199,307 | ||||
| Relief Of Poverty Grants | 79,779 | 45,802 | ||||
| Educational Grants | 103,509 | 186,296 | ||||
| Religious Grants | 31,532 | 23,500 | ||||
| Grants under £1,000 | 11,491 | 33,598 | ||||
| -------------------------------- | -------------------------------- | |||||
| 388,729 | 488,503 | |||||
| -------------------------------- | -------------------------------- | |||||
| Total grants | 388,729 | 488,503 | ||||
| ================================ | ================================ |
| All grants paid were in accordance with the Charity objectives. | All grants paid were in accordance with the Charity objectives. | All grants paid were in accordance with the Charity objectives. | |||
|---|---|---|---|---|---|
| 12. | Net gains/(losses) on revaluation of investment property | ||||
| Unrestricted | Total Funds | Unrestricted | Total Funds | ||
| Funds | 2020 | Funds | 2019 | ||
| £ | £ | £ | £ | ||
| Gains/(losses) on revaluation of | |||||
| investment property | (55,119) | (55,119) | (636,779) | (636,779) | |
| ============================ | ============================ | ================================ | ================================ |
- 20 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
13. Auditors remuneration
| 2020 | 2019 | |
|---|---|---|
| £ | £ | |
| Fees payable for the audit of the financial statements | 4,320 | 3,300 |
| ======================= | ======================= | |
| Fees payable to the charity's auditor and its associates for other services: | ||
| Other non-audit services | 2,160 | 2,160 |
| ======================= | ======================= |
14. Staff costs
The average head count of employees during the year was Nil (2018: Nil).
No employee received employee benefits of more than £60,000 during the year (2018: Nil)
15. Trustee remuneration and expenses
No remuneration or other benefits from employment with the charity or a related entity were received by the trustees.
No remuneration or other benefits from employment with the charity or a related entity were received or expenses reimbursed by the trustees.
16. Investments
| Investment | Other | ||
|---|---|---|---|
| properties | investments | Total | |
| £ | £ | £ | |
| Cost or valuation | |||
| At 1 December 2019 | 5,496,588 | 518,312 | 6,014,900 |
| Additions | 3,070,362 | – | 3,070,362 |
| Fair value movements | – | (25,000) | (25,000) |
| ----------------------------------------- | -------------------------------- | ----------------------------------------- | |
| At 30 November 2020 | 8,566,950 | 493,312 | 9,060,262 |
| ========================================= | ================================ | ========================================= | |
| Impairment | |||
| At 1 December 2019 and 30 November 2020 | – | – | |
| ================================ | ========================================= | ||
| Carrying amount | |||
| At 30 November 2020 | 8,566,950 | 493,312 | 9,060,262 |
| ========================================= | ================================ | ========================================= | |
| At 30 November 2019 | 5,496,588 | 518,312 | 6,014,900 |
| ========================================= | ================================ | ========================================= |
All investments shown above are held at valuation.
- 21 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
16. Investments (continued)
Investment properties
Investment properties above represent investments in UK investment property comprising various investment properties in the UK that the charity owns outright or 99%. Valuation of the UK investment property is current market value which is fair value in the opinion of the trustees and other independent valuations.
Other investments above represent investments with a holding of 25% and are accounted for in the same way as the investments properties above. Valuation of the associate holding is at market value, which is fair value, of the syndicate property in the opinion of the trustees. The trustees consider they do not exert significant influence and control over these investments. The trustees have elected to make use of relevant exemptions under FRS 102 as they do not believe it is appropriate, given the nature of these investments, to account for them as associates.
17. Investment entities
Subsidiaries and other investments
| Percentage | |||
|---|---|---|---|
| Class of | of shares | ||
| Registered office | share | held | |
| Subsidiary undertakings | |||
| Colmac Assets Limited | 5 Parkhill | Ordinary | 100 |
| Bury Old Road | |||
| Prestwich | |||
| M25 0FX |
The results for subsidiaries and other undertakings are as follows:
| Capital and | reserves | Profit/(loss) for the year | Profit/(loss) for the year | |
|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | |
| £ | £ | £ | £ | |
| Subsidiary undertakings | ||||
| Colmac Assets Limited | (629) | 1 | (628) | – |
| ============== | ============== | ============== | ============== | |
| Debtors | ||||
| 2020 | 2019 | |||
| £ | £ | |||
| Prepayments and accrued income | – | 6,000 | ||
| Other debtors | 25,994 | 21,418 | ||
| ---------------------------- | ---------------------------- | |||
| 25,994 | 27,418 | |||
| ============================ | ============================ |
18. Debtors
- 22 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
19. Creditors: amounts falling due within one year
| 2020 | 2019 | |
|---|---|---|
| £ | £ | |
| Bank loans and overdrafts | 50,002 | 20,000 |
| Accruals and deferred income | 6,480 | 10,920 |
| Social security and other taxes | 12,963 | 1,931 |
| Director loan accounts | 25,273 | 10,000 |
| Other creditors | 191,017 | 161,301 |
| -------------------------------- | -------------------------------- | |
| 285,735 | 204,152 | |
| ================================ | ================================ | |
| Creditors: amounts falling due after more than one year | ||
| 2020 | 2019 | |
| £ | £ | |
| Bank loans and overdrafts | 4,852,522 | 2,180,000 |
| Other creditors | 90,000 | – |
| ----------------------------------------- | ----------------------------------------- | |
| 4,942,522 | 2,180,000 | |
| ========================================= | ========================================= |
20. Creditors: amounts falling due after more than one year
The bank loans and overdrafts are secured on the investment property of the charity.
21. Analysis of charitable funds
Unrestricted funds
| Unrestricted funds | ||||||
|---|---|---|---|---|---|---|
| At | At | |||||
| 1 | December | Gains and | 30 November | |||
| 2019 | Income | Expenditure | losses | 2020 | ||
| £ | £ | £ | £ | £ | ||
| General funds | 3,724,191 | 1,249,457 | (783,160) | (55,119) | 4,135,369 | |
| ========================================= | ========================================= | ================================ | ============================ | ========================================= | ||
| At | At | |||||
| 1 | December | Gains and | 30 November | |||
| 2018 | Income | Expenditure | losses | 2019 | ||
| £ | £ | £ | £ | £ | ||
| General funds | 3,647,151 | 1,376,479 | (662,660) | (636,779) | 3,724,191 | |
| ========================================= | ========================================= | ================================ | ================================ | ========================================= |
- 23 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
22. Analysis of net assets between funds
| Unrestricted | Total Funds | |
|---|---|---|
| Funds | 2020 | |
| £ | £ | |
| Investments | 9,060,262 | 9,060,262 |
| Current assets | 303,364 | 303,364 |
| Creditors less than 1 year | (285,735) | (285,735) |
| Creditors greater than 1 year | (4,942,522) | (4,942,522) |
| ----------------------------------------- | ----------------------------------------- | |
| Net assets | 4,135,369 | 4,135,369 |
| ========================================= | ========================================= | |
| Unrestricted | Total Funds | |
| Funds | 2019 | |
| £ | £ | |
| Investments | 6,014,900 | 6,014,900 |
| Current assets | 93,442 | 93,442 |
| Creditors less than 1 year | (204,151) | (204,151) |
| Creditors greater than 1 year | (2,180,000) | (2,180,000) |
| ----------------------------------------- | ----------------------------------------- | |
| Net assets | 3,724,191 | 3,724,191 |
| ========================================= | ========================================= |
23. Analysis of changes in net debt
| At | At | ||
|---|---|---|---|
| 1 Dec 2019 | Cash flows | 30 Nov 2020 | |
| £ | £ | £ | |
| Cash at bank and in hand | 66,025 | 211,345 | 277,370 |
| Debt due within one year | (30,000) | (45,275) | (75,275) |
| Debt due after one year | (2,180,000) | (2,672,522) | (4,852,522) |
| ----------------------------------------- | ----------------------------------------- | ----------------------------------------- | |
| (2,143,975) | (2,506,452) | (4,650,427) | |
| ========================================= | ========================================= | ========================================= |
- 24 -
MW (RH) Foundation
Company Limited by Guarantee
Notes to the Financial Statements (continued)
Year ended 30 November 2020
24. Related parties
Mrs R Halpern, trustee of MW (RH) Foundation also has the following directorships and ownerships as detailed below:-
Leicester Investments Ltd - director and minority shareholder; Debmar Benevolent Trust Ltd - trustee;
Middleton Investments Ltd - director and minority shareholder. Hilary Holdings Ltd - director and minority shareholder.
£88,596 donated income for the year came from one or more of the above companies. A further £334,125 was donated from the trustees personally or from their other companies.
Included in other creditors are the following amounts owing to companies/charities with common directors to the trustees of this charity; The Jayrose Charitable Trust £32,000, J & R Assets (No 2) Ltd - £58,000 (2019:£ 10,500), J & R Holdings Limited £167,070 (2019:£47,000), Waterhill Property Group Limited £8,000 (2019:£ 8,000).
The above loans are interest free.
25. Taxation
MW (RH) Foundation is a registered charity and therefore is not liable to income tax or corporation tax on income derived from its charitable activities, as it falls within the various exemptions available to registered charities.
- 25 -