DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C Registered number.. 07535303 Charity number: 1143110 THE KNIGHTLAND FOUNDATION (A company limited by guarantee) Trustees, report and financial statements For the Year Ended 31 January 2023 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Contents Page Reference and admlnlstratlve detslls of the Company, Its Trustees and advlsers Trustees. report Independent auditors. report on the flnanclal statements Statement of financial activities 7-10 Balance sheet 12-13 Statement of cash flows 14 Notes to the financial statements 15-25 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Reference and administrative details of the Company, its Trusteesl Interim Managers and advisers For the Year Ended 31 January 2023 U S Kaplan (resigned 26 April 20231 S Lew Iresigned 26 April 20231 B S Ehrenfeld (resigned 26 April 20231 M Benedikl lappoinled 26 April 20231 S R Derbaremdiger (appointed 26 April 20231 B R Feldman lappointed 26 April 20231 S B Feldman lappointed 26 April 20231 S S Zaltzman (appointed 26 April 20231 J Friedman Company reglstered number 07535303 Charity reglstered number 1143110 Reglstered offlce Lower Ground Floor 139 Osbaldeslon Road London N16 6ND Principal operatlng office 16 Urban Hive London E5 9BQ Independent audltors Moore Kingston Smith LLP Chartered Accountants 6th floor 9 Appold Street London EC2A 2AP 8ankers Barclays Bank PLC Leicester LE87 2BB Lloyds bank PLC PO Box 10000 BX1 1LT Interlm Managers Joseph Colley and John Dickinson Carter Backer Winter LLP 66 Prescot Street London E1 8NN Page 1 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Trustees, report For the Year Ended 31 January 2023 The Charity Commission l The Commission") has engaged with the Knightland Foundation since 2016, when its proactive review of the Charity's accounts revealed a number of concems, including around insufficiently documented loan agreements and transactions to connected companies. In March 2017, the Commission issued the charity's trustees with an action plan to address these matters. The Commission continued lo monitor the charity and due to unresolved Concerns, It escalated Ils engagement lo a slatulory inquiry on 24 February 2021. An Inquiry gives the regulator access to the full range of its legal an enforcement powers. The inquiry will examine whether potential conflicts of Interest and connected party transactions have been properly managed and whether there has been any unaulhorised Iruslee benefit. 11 will also look at wider concerns around the charity's financial and resource management and the trustees, compliance with their legal obligations. The Commission has also exercised its powers under the Charities Act 2011 to appoint joint interim managers, John Dickinson and Joseph Colley, of Carter Backer Winter LLP, on 7 April 2021 to help address the concerns at the charity. By virtue of their appointment, the interim managers are required lo lake over the management, adminislralion and operation of the charity and ils property and to discharge the functions of the trustees to the exclusion of the current trustees. The Interim Managers present their annual report together with the audited financial statements of the The Knighlland Foundation for the year 1 February 2022 to 31 January 2023. The Annual report serves the purposes of both a Interim Managers, report and a director5, report under company law. The Interim Managers confirm that the Annual report and financial statements of the charitable company comply with the current slatulory requirements, the reqLJiremenls of the charitable company's governing document and the provisions of the Statement of Recommended Practice ISORPI applicable lo charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS1021 leffeclive 1 January 20191- Since the Company qualifies as small under section 382 of the Companies Act 2006, the Strategic report quired of medium and large companies under the Companies Act 2006 (Strategic Report and Directors, Report) Regulations 2013 has been omitted. Objectives and activities * Policies and objectives The objectives of the charity are to SLJPPOrt the acb'vities of religious Jewish organisations both in the UK and abroad, especially those that promote Orthodox Jewish religion, education, ￿lief of poverty and other welfare activities. In setting objectives and planning for activities, the Trusteesl Interim Managers have given due consideration to general guidance published by the Charity Commission relating to public benefit, including the guidance 'Publie benefit. running a charity IPB21'. • Grant4naking policies In making grants and donations, the Trustees use their personal knowledge of the institution, its presenlatives, operational efficiency and reputation. The Trustees monitor the application of the grants and donations by meeting with representatives of the institutions and obtain information as lo the ulilisation of funds. Since their appointment, the interim managers have been monitoring grant applications and are responsible until such lime that their appointment eeases. Page 2 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Trustees. report Icontinuedl For the Year Ended 31 January 2023 Achievements and performance >> Main achievement5 of the Charity During the year, the charity distributed grants of £NIL12022.. 127,8001. The charity was managed by the interim managers who did not distribute any funds pending the appointment of a new sel of trustees. A new board has now been appointed and they are now working to continue lo distribute funds in awordance with the charity's objectives. Investment policy and pèrfomiance Under the Memorandum and Articles of Association, the eharity has the power to make any investment which the Interim Managers see fit. The Charity may make financial investments (to generate a retuml and socially responsible financial investments Ito generate a return and lo directly further the charity's purposes). The Interim Managers continue lo assess the charity's investment portfolio and seek new investment opportunities to ensure that the charity's asset base is maintained and SLJitable surpluses are generated. The Interim Managers are satisfied with the return on investments achieved during the year and are confident that the charity has adequate reserves lo fulfil its charitable obligations. Financial revièw Going concern The Interim Managers recognise the economic and trading Ljncertainlies resulting from the current Ljneertain economic outlook, in particular the potential impact on rental collection and property values. The Interim Managers have therefore prepared revised cash flow forecasts and stress tests taking these factors into account. These forecasts show that the charity will be able to continue to meet ils obligations as they fall due without breaching covenants associated with existing bank loans. After making appropriate Ènquiries, the Interim Managers therefore have a oasonable expectation that the Company has adequate resources lo continue in operational existence for the twelve months from the date that the accounts are signed. For this ￿aSOn, they conlinLJe to adopt the going concern basis in preparing the financial statements. Further details regarding the adoption of the going concern basis can be found in the aecounting policies. • Reserves polity The Charity is reqUI￿d to maintain reserves in ils unreslricled funds that have not yel been committed or designated for any partieular purpose. This is to ensure that the Charity is in a position lo eontinue to meet its commitments and its grant making aclivilies, and lo protect the future operations of the Charity from the effects of any unforeseen variations in its income streams as part of a policy of good financial management practice. Consequenlly, the Interim Managers consider it appropriate to maintain unrestricted funds al a level which will not impinge on ils ability to support charitable institutions. At the year end, the Charity had free available reserves of £1,652,40212022 - £1,552,2481. Page 3 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Trustees. report Icontinuedl For the Year Ended 31 January 2023 >> Financial review During the year the charity received donations of £12,16612022 - NILI from ils subsidiaries. The Interim Managers are pleased that they were able to collect loo,￿ of contracted rents during the year. The charitys subsidiary Rowe Lane Estates Ltd repaid £800,000 of ils loan. Closing cash reserves are £864,387. Structure? governance and management Constitution The Knighlland Foundation is registered as a charitable company limited by guarantees and was set up by a Memorandum and Articles of Association on 18 February 2011. Pursuant to the duties as set out in the Interim Managers, appointment Order, they are to review the future governance of the charity". determine whether the charity has a viable future and either undertake the restructure of the charity (including appointment of independent trustees) or undertake the winding LJP of the charity in accordance with its Governing Document and apply the remaining funds to a charity with the same or similar charitable objects. The constitution of the charity remains under review. Methods of appointment or election > Risk management The Interim Managers have assessed the major risks lo which the charity is exposed, in particular those related lo the operations and finances of the charity and loans lo Its subsidiaries, and are satisfied that systems and procedures are in place lo mitigate exposure to the major risks. The Interim Managers have considered the risks associated with the values and returns generated by its investment property, as economic uncertainties continue. They are confident that investment values and returns will continue al the levels staled in the accounts. The Interim Managers are continuing lo work in association with their professional advisors lo strengthen the skills, performance and effectiveness of the Iruslee board. Statement of Interim Managers. and Trustees responsibilities The Interim Managers (who are also the direelors of the Company for the purposes of company lawl are responsible for preparing the Interim Managers, report and the financi21 statements in accordance with applicable law and United Kingdom AccoLJnting Standards (United Kingdom Generally Accepted Accounting Practice). Company law requires the Interim Managers to prepare financial statements for each finaneial year. Under company law, the Interim Managers musl not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of its incoming resources and application of resources, including its income and expenditure, for that period. In preparing these financial statements, the Interim Managers are required lo". select suitable accounting policies and then apply them consistently., observe the methods and principles of the Charities SORP IFRS 1021", make judgments and accounting estimates that are reasonable and prudent", stale whether applicable UK Accounting Standards IFRS 1021 have been followed, subject to any material departures disclosed and explained in the financial statements., prepare the financial statements on the going concern basis unless il is inappropriate to presume that the Company will continue in business. The Interim Managers are responsible for keeping adequate accounting records that are sufficient lo show and explain the Company's transactions and disclose with reasonable accuracy al any time the financial position of the Company and enable them lo 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. Page 5 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Trustees. report Icontinuedl For the Year Ended 31 January 2023 Disclosure of infomiation to auditors Each of the persons who are Interim Managers at the time when this Interim Managers, report is approved has confirmed that.. so far as that Interim Manager is aware, there is no relevant audit information of which the charity's auditors are Ljnaware, and that Interim Manager has taken all the steps that ought to have been taken as a Trusleel Interim Manager in order lo be aware of any relevant audit infomialion and lo establish that the charity's auditors are aware of that information. Auditors The auditors, Moore Kingston Smith LLP, have indicated their willingness to continue in office. The designated Trusleesl Interim Managers will propose a motion reappointing the auditors at a meeting of the Trusteesl Interim Managers. Reporting period The financial statements cover the reporting period to year ended 31 January 2023, this is prior lo the appointment of the current trustees who have signed the accounts. The current trustees who were appointed after 31 January 2023 have consulted with the Charity Commission and have accepted the assuran￿ from the interim managers, who were involved in assisting the charity and the previous trustees that were in office during the reporting period. The current trustees have received induction, ne￿SSary training and independent guidance from the interim managers and are deemed suitsble for their roles and having consulted with the Charity Commission they are in a position lo sign the financial ststements. b order of the members of the board of Trustees and signed on their behalf by.. Trustee Dale.. 24/10/2023 Page 6 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Opinion We have audited the fi'nancial statements of The Knighuand Foundation I'lhe company'l for the year ended 31 January 2023 which comprise the Statement of Financial Activities, the Balan￿ Sheet, the Cash Flow Statement and notes to the financial statements. 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 Ireland, Iunited Kingdom Generally AC￿pted Accounting Practice). In our opinion the financial statements.. give a true and fair view of the slate of the charitable company's affairs as at 31 January 2023 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended", have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice., and have been prepared in accordance with the requirements of the Companies Act 2006. Basis for opinion We conducted our audit in accordance with Internats'onal Standards on Auditing IUKI IISASIUKII and applicable law. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the audit of financial statements section of our report. We are independent of the charitable company in accordan 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 obtsined is suffi'cient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the Interim Managers, use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating lo events or conditions that, individually or collectively, may cast significant doubl on the charitable company's ability to continue as a going concem for a period of at least ￿e1ve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the trusteeslinterim managers with respect to going con￿rn are described in the relevant sections of this report. Other information The other information comprises the information included in the annual report, other than the financial statements and our audilorfs report thereon. The Interim Managers are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except lo the extent otheNise explicitly slated 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 lo 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 lo be materially misstated. If we identify such material inconsistencies or apparent material misstalemenls, we are required to detemiine whether there is a material Page 7 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} 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.. the information given in the trustees, annual report for the financial year for which the financial statements are prepared is consistent with the financial statements, and the Interim Managers, annual 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the Interim Managers, annual report. We have nothing lo report in respect of the foll()wing matters where the Companies Act 2006 requires us to port lo you if, in our opinion. adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us., or the financial statements are not in agreement with the accounting records and returns., or certain disclosures of trustees, l interim managers, remuneration specified by law are not made., or we have not received all the information and explanations we require for our audit. or the trustees were not entitled to prepare the financial statements in accordance with the small companies regime and lake advantage of the small companies exemption in preparing the Interim Managers, Annual Report and from preparing a Strategic Report. Responsibilities of Trustees and Interim Managers As explained more fully in the trustees, responsibilities statement set out on page S, the trustees (who are also the directors of the charitable company for the purposes of company law or interim managers, where appointed) are responsible for the preparation of the financial slalemenls and for being satisfied that they give a true and fair view, and for such intern81 control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due lo fraud or error. In preparing the financial slatemenls, the Interim Managers are responsible for assessing the charitable company s ability lo continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Interim Managers either intend to liquidate the charitable company or to cease operations, or have no ￿aliStiC altemalive bul to do so. Auditor's responsibilities for the audit of the financial statements Our objectives are lo obtain reasonable assuonce 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 ￿port that includes our opinion. Reasonable assurance is a high level of assurance, bul is not a guarantee that an audit conducted in accordance with ISAS IUKI will always delect a material misstalemenl when it exists. Misstatements can arise from fraud or error and a￿ considered material if, individually or in aggregate, they could reasonably be Page 8 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} expected lo influence the economic decisions of users taken on the basis of these financial ststements. Irregularities, including fraud, are instances of non-complian￿ with laws and regulations. We design procedures in line with our responsibilities, outlined above, to delecl material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of delecling irregularities, including fraud is detailed below. Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud The objectives of our audit in respect of fraud, are., lo identify and assess the risks of material misstatement of the financial statements due lo fraud,. to obtain sufficient appropriate audit evidence regarding the assessed risks of material misslalemenl due to fraud, through designing and implementing appropriate responses to those assessed risks,. and to respond appropriately lo instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the charitable company. Our approach was as follows.. We obtained an understsnding of the legal and regulatory requirements applicable lo the charitable company and considered that the most significant are the Companies Act 2006, the Charities Act 2011, the Charity SORP, and UK financial reporting standards as issued by the Financial ReF)Orting Council. We obtsined an understanding of how the charitable company complies with these requirements by discussions with management and those charged with governance. We assessed the risk of material misstatement of the financial slalemenls, including the risk of material misslatemenl due lo fraud and how it might occur, by holding discussions with management and those charged with g0veman￿. We inquired of management and those charged wth governan￿ as to any known instance5 of non- compliance or suspected non-compliance with laws and regulations. Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with g0Veman￿ and obtsining additional corroborative eviden￿ as required. As part of an audit in accordance with ISAS IUKI we exercise professional judgement and maintain professional scepticism throughout the audit. We also". Identify and assess the risks of material misstatement of the financial slatemenls, whether due lo fraud or error, design and perform audit procedures responsive lo those risks, and obtain audit evidence that is sufFicienl and appropriate to provide a basis for our opinion. The risk of not delecling 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. Obtain an understanding of internal control relevant lo the audit in order lo design audit procedu￿$ that are appropriate in the circumStan￿s, but not for the purposes of expressing an opinion on the effectiveness of the charitable company's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting eslimales and related disclosures made by the trustees. Page 9 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Conclude on the appropriateness of the Interim Managers, use of the going concern basis of accounting and, based on the audit eviden￿ obtained, whether a material uncertainty exists related to events or onditions that may cast significant doubt on the charitable company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required lo draw attention in our 8uditor's report lo the related disclosures in the financial statements or, if such disclosures are inadequate, lo modify our opinion. Our conclusions are based on the audit eviden￿ obtained up lo the dale of our auditorfs report. However, future events or conditions may cause the charitable company to cease to continue as a going concern. Evaluate the overall presentstion, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the undedying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and liming of the audit and significant audit findings, including any significant deficiencies in intemal control that we identify during our audit. Use of our report This report is made solely to the charitable Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might stale lo the ompany's members those matters we are required to slate 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 any paty other than the charitable company and charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed. Dale.. 24 October 2023 Shivani Kothari (Senior talutory audilorl 11curt ￿￿￿1510￿ LtL Lif for and on behalf of Moore Kingston Smith LLP, Statutory Auditor 6th Floor 9 Appold Street London EC2A 2AP Page 10 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Statement of financial activities (incorporating income and expenditure accounti For the Year Ended 31 January 2023 Unrestricted funds 2023 Total funds 2023 Total funds 2022 Note Income from: Donations and legacies Investments 74.533 623.366 74.533 623,366 66,260 662,606 Total income 697,899 697,899 728,866 Expenditure on: Investment management costs Charitable activities 307.900 142.424 307.900 142.424 230,428 303,338 Totsl expenditure 450,324 450,324 533, 766 Nel losses on investments (560,000) Net movement in funds 247.575 247,575 (364,900) Reconciliation of funds: Total funds brought forward Nel movement in funds 5,284.405 247.575 5,284.405 247.575 5,649,305 (364,900) Total funds carried forward 5,531,980 5,531,980 5,284.405 The Statement of financial activities includes all gains and losses recognised in the year. The notes on pages 15 to 25 fomi part of these financial statements. Page11 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Balance Sheet For the Year Ended 31 January 2023 2023 2022 Note Fixed assets Investments Investment propety 13 12 201 8.500,000 201 8,500,000 8,500,201 8,500,201 Current assets Debtors 14 963.336 864,387 1, 740,630 148,641 Cash al bank and in hand 1,827,723 1,889,271 Creditors.. amounts falling due within one year 15 (328.732) (484,600) Net current assets 1,498,991 1,404,671 Total assets less current liabilities 9,999,192 9,904,872 Creditors.. amounts falling due after more than one year 16 {4.467,212} (4, 620,467) Total net assets 5,531,980 5,284,405 Charity funds Unrestricted funds 17 5.531,980 5,284,405 Total funds 5,531,980 5,284,405 The entity was entitled to exemption from audit under section 477 of the Companies Act 2006. The members have not required the entity lo obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006. However, an audit is required In accordance with section 144 of the Charities Act 2011. The Interim Managers and Trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements. Page 12 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Balance sheet (continued} For the Year Ended 31 January 2023 The financial ststemenls have been prepared in accordan￿ with the provisions applicable to entities subject to the small companies regime. The financial statements were approved and aulhorised for issue by the Trustees and signed on their behalf by.. D¢¢uSWby. A8B•91A7￿7c4EF B R Feldman Trustee Dale.. 24110/2023 The notes on pages 15 to 25 form part of these financial statements. Page 13 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Statement of cash flows For the Year Ended 31 January 2023 2023 2022 Note Cash flows from operating activities Nel cash used in operating aclivits'es 18 1.050,649 464,955 Cash flows from financing activities Repayments of borrowing Interest payable 1147.4211 1187.4821 (738,580J (181, 166) Net cash used In flnanclng actlvltles 1334,9031 1319,746) Change in cash and cash equivalents in the year Cash and cash equivalents at the beginning of the year 715,746 145,209 148,641 3,432 Cash and cash equlvalents at the end of the year 19 864,387 148,641 The notes on pages 15 to 25 fomi part of these financial statements Page 14 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 General Informatlon The Knightland Foundation is a charitable trust registered in England and Wales under the Charities Act. The address of the registered Offi￿ is given on the Infomialion page. Accountlng pollcles 2.1 Basis of prgparation of financial statements The financial statements have been prepared in accordance with the Charities SORP IFRS 1021- Accounting and Reporting by Charities.. Statement of Recommended Practice applicable lo charities preparing their awounts in accordan￿ with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 leffective 1 January 20191, the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 and the Companies Act 2006. The Knightland Foundation meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value. Investment property is carried al fair value as slated in the relevant accounting policy. 2.2 Going concern The Interim Managers recognise the economic and trading uncertainties resulting from the coronavirus pandemic, and more recently the cost of living crisis and potential recession, in particular the potential impact on rental collection and property values. The Interim Managers have therefore prepared revised cash flow forecasts and stress tests taking these factors Into account. These forecasts show that the charity will be able lo continue to meet ils obligations as they fall due without breaching covenants associated with existing bank loans. After making appropriate enquiries, the Interim Managers therefore have a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements. The Interim Managers are therefore confident of being able lo trade for a period of at least 12 months from the approval of the financial statements and the Interim Managers have therefore concluded that It Is appropriate for the financial statements lo be prepared on the going con￿r￿ basis. These financial statements do not include any adjustments should the going concern basis preparation be inappropriate. 2.3 Income All income is recognised once the Charity has enb'llemenl to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably. Donations in kind received as property management services, are included at valuab.on and recognised as income when they are re￿ived. Income tsx recoverable in relab'on lo investment income is recognised at the lime the investment income is receivable. Page 15 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 Accounting policies Icontinuedl 2.4 Expenditure Expenditure is recognised once there is a legal or conslruclive obligation lo transfer economic benefit lo a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly lo that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned bel￿een those activities on a basis consislenl with the use of reSoUr￿s. Central staff costs are allocated on the basis of lime spent, and depreciation charges allocated on the portion of the asset's use. Expenditure on raising funds includes all expenditure incurred by the Company to raise funds for its charitable purposes and includes costs of all fvndraising activities events and non-charitable trading. Expenditure on charitable activities is incurred on directly undertaking the activities which further the Company's objectives, as well as any associated support costs. 2.5 Investments Fixed asset investments are a form of financial instrument and are initially recognised al their transaction cost and subsequently measured at fair value al the Balance sheet dale, unless the value cannot be measured reliably in which case il is measured at cost less impairment. Investment gains and losses, whether realised or unrealised, are combined and presented as 'GainsllLossesl on investments, in the Statement of financial activities. Investments in subsidiaries are valued at cost less provision for impairment. 2.6 Investment Property Investment property is carried at fair value delemiined annually by the directors, with the use of extemal valuations, the current market rents and investment property yields for comparable real estate, adjusted if ne￿SSary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the SOFA. 2.7 Liabilities and provisions Liabilities are recognised when there is an obligation al the Balan￿ sheet dale as a result of a past event, il is probable that a transfer of economic benefit will be required in selllement, and the amount of the settlement can be estimated reliably. Liabilities are recognised al the amount that the Company anticipates il will pay to settle the debt or the amount it has received as advanced payments for the goods or ServI￿S it must provide. Provisions are measured al the best estimate of the amounts required to sellle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted al the pre-tax discount rale that reflects the risks specific lo the liability. The unwinding of the discount is recognised in the Statement of financial activities as a finance cost. Page 16 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 Accounting policies Icontinuedl 2.8 Taxation The charity is exempt from corporation lax on ils charitable activities. 2.9 Financial instruments The Company only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured al their settlement value with the exception of bank loans which are subsequently measured al amortised cost using the effective interest method. 2.10 Fund accounting General funds are unrestricted funds which are available for use al the discretion of the Trusteesl Interim Managers in furtherance of the general objectives of the Company and which have not been designated for other purposes. Investment income, gains and losses are allocated to the appropriate fund. Critical accounting estimates and areas of judgment Estimates and judgments are continually evaluated and are based on historical experien￿ and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Critical accounting estimates and assumptions.. In preparing these financial statements the trustees have made judgements to determine the fair value of the company's investment property. Factors taken into consideration include the current market rents and investment propety yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset, and taking into account the impact of current economic conditions. Income from donations and legacies Unrestricted funds 2023 Total funds 2023 Total funds 2022 Donations Donations in kind 12,166 62,367 12,166 62,367 66,260 Total 2023 74,533 74,533 66,260 Page 17 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 Income from donatlons and legacles Icontlnuedl Donations include £12,16612022 £NILI from related corporate entities. See related party transactions note for more details. Donations in kind comprise property management services received at no cost. See related paty transactions note for more details. Investment income Unrestricted funds 2023 Total funds 2023 Total funds 2022 Investment income - rental income 623,366 623,366 665,939 (3,333) Investment income - rent eoneessions 623,366 623,366 662,606 Investment management costs Unrestricted funds 2023 Total funds 2023 Total funds 2022 Property expenses Insuran￿ recharges Repairs and maintenance Interest payable and similar charges Propety management- donation in kind 28,142 148,2161 68,525 197,082 62,367 28,142 {48,2161 68,525 197,082 62,367 16,662 (51, 765) 16,906 182,365 66,260 307,900 307,900 230,428 Page 18 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 Analysls of grants Grants to Institutions 2023 Total funds 2023 Total funds 2022 Grants Payable 127,800 Analysis of expenditure by activities Grant funding of activities 2023 Support costs 2023 Total funds 2023 Total funds 2022 Charitable activities 142,424 142,424 303,338 For the year ended 31 January 2023 due to the change of Iruslees no charitable grants were approved. However the charity still incurred running costs. Analysis of support costs Total funds 2023 Total funds 2022 Activities 2023 Bad debt 335 335 22,453 281 Bank charges Legal and professional fees Governance costs 359 359 25,099 116,631 25,099 116.631 15,805 136, 999 142,424 142,424 175, 538 Page 19 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 Audltors. remuneratlon 2023 2022 Fees payable lo the Company's auditor for the audit of the Company's annual accounts 22,200 20.355 10. Interim Managers. remuneration and expenses During the year ended 31 January 2023 the Interim Managerfs remuneration was £59,467 (2022 £706,698J. No Trustees received any remuneration or other benefits12022 - £NILI. 11. Employees The average monthly number of employees was NIL12022 - NIL). 12. Investment property Freehold Investment property Valuation At 1 February 2022 8,500,000 At 31 January 2023 8,500,000 The 2022 valuations were instructed by the Interim Managers, based where applicable on discussions with valuation professionals and on valuation reports on certain of the group's properties prepared for lending purposes, on an open market value for existing use basis. The Interim Managers commissioned an indicative valuation of the charity's commercial property portfolio as al 24 August 2022 from Lambeth Smith Hampton. The purpose of that valuation was to inform the Interim Managers of the existing value within the estate. The Interim Managers accept that there is no eviden￿ lo support a material difference be￿een a valuation at 31 January 2023 and the one conducted on 24 August 2022, and have continued to adopt the valuation in fvll this year. Page 20 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 13. Flxed asset Investments Investments in subsidiary ompanies Cost or valuation At 1 February 2022 201 At 31 January 2023 201 Net book value At 31 January 2023 201 At 31 January 2Q22 201 Prlnclpal subsldlarles The following were subsidiary undertakings of the Company.. Names Prlnclpal actlvlty Class of shares Holdlng Bellview Management Ltd Bellview Land Ltd Canvey Housing Ltd Rowe Lane Estates Ltd Property investment Ordinary Property investment Ordinary Property investment Ordinary Property investment Ordinary 1000 500 1000 500 The financial results of the subsidiaries for the year were.. Names ProfiUILossl Net assetsl I Surplusl Iliabilitiesl {Defieitl for the year Bellview Management Ltd Bellview Land Ltd Canvey Housing Ltd Rowe Lane Estates Ltd 116,561 120,0001 45,232 405,720 348,099 69,493 122,4571 Page 21 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 14. Debtors 2023 2022 Due within one year Trade debtors Amounts owed by group undertakings Other debtors 86,573 857,904 18,859 82, 726 1, 657,904 963,336 1, 740,630 Amounts owed by group undertakings are repayable on demand. 15. Creditors: Amounts falling due within one year 2023 2022 Bank loans 153,411 11,679 19,934 41,197 102,511 14T,5T7 21,252 19,089 112.561 184, 121 Trade creditors Other taxation and social security Other creditors Accruals and deferred income 328,732 484,600 Other creditors inlcude £NIL12022 - £82,500) that was ()wed to related parties. 2023 2022 Deforred income Balance brought forward Amounts released during the period Amounts deferred during the period 89,456 189.4561 81,511 89,456 (89.456J 89,456 Balance carried forward 81,511 89,456 Page 22 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 16. Credltors: Amounts falllng due after more than one year 2023 2022 Bank loans 4.467,212 4,620,467 The bank loans are secured by fixed charges over the investment properties. The rates payable on the loans are fixed partly at 3.940k until expiry in May 2025 and partly al 3.10/0 until expiry in November 2024. Loan amortisation of £150,000 per annum is due until expiry. Included within the above are amounts falling due as follows.. 2023 2022 Between one and two years Bank loans 134.741 153,411 Between two and flve years Bank loans 4,332,471 4,467.056 17. Statement of funds statement of funds - current year Balance at 1 February 2022 Balance at Gainsl 31 January {Lossesl 2023 Income Expenditure Unrestricted funds General Funds - all funds 5.284.405 697.899 1450,3241 5.531.980 Statement of funds - prior year Balance at l Febwary 2021 Balan￿ al Gain￿ 31 January (Losses) 2022 Income Expenditure Unrestricted funds General Funds - all funds 5,649,305 728,866 (533, 766) (560,000) 5,284,405 Page 23 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 18. Reconclllatlon of net movement In funds to net cash flow from operatlng actlvltles 2023 2022 Net incomelexpendilure for the year {8s per Statement of Financial Acliviliesl 247,575 (364,900) Adjustments for: Deficivlsurplusl on revaluation of property Interest paid Decreasellincreasel in debtors Increaselldecreasel in creditors 560,000 181, 166 (31,111) 119,800 187,482 778,294 1162.7021 Net cash provided by operating activities 1.050,649 464,955 19. Anatysis of Cash and cash equivalents 2023 2022 Cash in hand 864,387 148,641 Total cash and cash equivalents 864,387 148,641 20. Anatysis of changes in net debt At1 February 2022 Cash flov At31 January 2023 Cash at bank and in hand Debt due within 1 year Debt due after 1 year 148,641 1147,5771 {4.620,4671 715,746 864,387 15,8341 1153,411) 153.255 14.467.212) {4,619,4031 863,167 13,756,236) Page 24 DoGuSvJn Envelope ID". 86F1FF28-5CEB440CAFF1.72A63672055C THE KNIGHTLAND FOUNDATION IA company limited by guarantee} Notes to the financial statements For the Year Ended 31 January 2023 21. Related party transactions The following amounts were owed Iloll from related parties, in which the trustees have a controlling interest. A Iruslee, J Friedman, is director of all the subsidiaries. Another Iruslee, S Zaltzman, is director of Bellview Management Limited. All changes in the balances relate to cashflows in the year. 2023 2022 Bellview Managmenl Limited {subsidiaryl Canvey Housing Limited Isubsidiaryl Rowe Lane Esales Ltd Isubsidiaryl Bellview Estates Ltd (common controll 341,808 132,045 384,051 341,808 132,045 1, 184,051 (82,500) 857,904 1,575,404 A trustee, J Friedman, also has a 50¥0 share in a subsidiary of the charity Rowe Lane Eststes Ltd. During the year, the charity's subsidiary Rowe Lane Eststes Ltd repaid £800,000 of the loan balance due lo the charity. During the year the charity received donations of £12,166 12022 £NILI from its subsidiary Bellview Management Ltd. Amounts owed Ilollfrom companies under common control are interest free loans and repayable on demand. Propety management setvices for the value of £62,367 12022 £66,260) were provided by Bellview Management IUKI Limited, a company under the control of one of the trustees. These serVI￿S were provided at no charge, and have been shown in the accounts as a donation-in-kind. Page 25