2021-07-31-accounts

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Orchard Hill College

Annual Report and Financial Statements

31 July 2022

Charity Registration Number 1144922 Company Registration Number

07586715 (England and Wales)

Reports
Reference and administrative information	1
Trustees’ report	3
Independent auditor’s report	20
Accounts
Statement of financial activities	24
Balance sheet	25
Statement of cash flows	26
Principal accounting policies	28
Notes to the accounts	33

Reference and administrative information 31 July 2022

Members John Brown Darren Coghlan Peter Holmes Roger Mills Trustees / Directors Peter Lauener (Chair) Rama Venchard (Vice Chair) John Prior (CEO) Akansha Arya (Appointed 25.3.22) Julie Avis Simon Fryer Principal office 8th Floor Quadrant House The Quadrant Sutton Surrey SM2 5AS Telephone 0345 402 0453 Website www.orchardhill.ac.uk Charity Registration Number 1144922 Company Registration Number 07586715 (England and Wales) Executive Senior Leadership Team CEO John Prior Chief Finance Officer Corrina Jenkins Chief Operating Officer Stuart Dixon Executive Principal/ Deputy CEO Laurie Cornwell Principal Kelly Phillips Executive Director of Development Lynn Barratt External Auditor Buzzacott LLP 130 Wood Street London EC2V 6DL

Orchard Hill College 1

Reference and administrative information 31 July 2022

Internal Auditor TIAA Ltd Artillery House, Fort Fareham Newgate Lane Fareham PO14 1AH Bankers Lloyds Bank Plc 49/53 High Street Sutton Surrey SM1 1DT Barclays Corporate Banking 1 Churchhill Place Canary Wharf London E14 5HP Solicitors Veale Wasborough Vizards Orchard Court Orchard Lane Bristol BS1 5WS

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Trustees’ report (including Strategic Report) 31 July 2022

The Trustees present their statutory report together with the financial statements of Orchard Hill College (‘OHC’ or ‘the College’) for the year ended 31 July 2022.

The report has been prepared in accordance with Part 8 of the Charities Act 2011 and it is also the report of the directors for the purposes of the Companies Act 2006.

The financial statements have been prepared in accordance with the accounting policies set out on pages 28 to 32 and comply with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102).

It should be noted that the directors of Orchard Hill College are the Trustees and as such both terms are used interchangeably throughout this report.

OBJECTIVES AND ACTIVITIES

Orchard Hill College is a specialist college committed to offering social and vocational opportunities for students in the heart of their communities. Our vision statement is “Building Futures, Changing Lives” and this commitment informs everything we do.

Our provision is open to students over the age of 16 with a wide range of additional needs. All students are individual, and each programme is as unique as they are. Operating out of eight main centres and additional satellite provision across London and Surrey, our programmes are designed to support and empower each student to achieve their aspirations and goals, whilst developing skills to prepare them for adulthood. Alongside this, we work closely with families, local authorities, community stakeholders and other external partners in order to broker strong community partnerships that will support our students to build meaningful and fulfilling lives.

As a charity, our objects are to advance education, training, vocational and occupational opportunities for the benefit of the public in the following ways:

♦ promoting and widening participation in education, training, vocational and occupational opportunities, particularly for students with complex/profound/severe learning difficulties and/or disabilities and those who have been previously excluded from such opportunities and supporting practitioners who work with such students;
♦ improving the quality of education, training, work placements and employment prospects, particularly for students with complex/profound/severe learning difficulties and/or disabilities and those who have not previously been equitably represented in such opportunities and supporting practitioners who work with such students;
♦ recognising progress in all forms: promoting and improving access to education, training, work and employment opportunities, through the development and promotion of resources, provision, organisations and systems; and
♦ any other activity in its own work or work with others not covered by the above which, in the view of the Trustees directly enhances the charity’s activities and objectives.

Public benefit

In formulating the College’s aims and in planning its activities, the Trustees confirm that they have had due regard to the general guidance published by the Charity Commission on public benefit.

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Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE

Orchard Hill College (OHC) is an outstanding college and continues to be so. The College provides exceptional opportunities for learning and meeting the needs and aspirations of its students. Orchard Hill College works closely with its many communities and commissioners, including 28 local authorities, to ensure that it is always responsive to increased student demand which is growing year on year. Specialist centres are sited in Camberwell, Kingston, Wandsworth, Carshalton, Sutton and Hillingdon.

Orchard Hill College is an Independent Specialist College listed in Section 41 of the Children and Families Act 2014 and also delivers work-related training through a GLA (AEB) funding grant as well as apprenticeship delivery. The College delivers the highly regarded Diploma in Education & Training (SEND pathway), validated by Canterbury Christchurch College University. The College continues to be listed on the Register of Apprenticeship Training Providers; all providers were invited to reapply in 21-22 as part of a full refresh of the Register in which no previous information was considered by the ESFA. OHC’s application was submitted in November 2021 and subsequently approved.

Overall student numbers increased from 354 in 2020-21 to 411 in 2021-22, an increase of 14%, with overall retention at 97%. Across all courses and centres the quality of education students receive continues to be outstanding. Typically 100% of teaching is at least Good or better. The overall effectiveness of teaching is quality assured using the Teacher Evaluation Schedule (TES).

OHC students help to design their programmes to achieve their aspirations and goals, whilst developing their skills and talents to become more independent in their lives in the future. The College is a busy, diverse and vibrant place to work and study, with a high focus on vocational programmes together with being part of the local communities it serves.

The College was re-accredited with the Matrix Standard in January 2022 which affirms the many areas of outstanding practice, particularly in relation to careers education, information, advice and guidance (CEIAG), and how the College has evolved over the last three years since the last inspection, as well as the College’s response to Covid so that students could progress through the swift development of the recovery curriculum.

The majority of students attend a full-time course. There are two course offers:

♦ Foundation Skills for Life which is a specialist Post-19 programmes for students with complex, profound, and severe learning difficulties and/or disabilities, and;
♦ Skills for Work and Living, for students with an aspiration or an identified outcome in employment.

Both courses have four study programmes which are related to preparation for adulthood outcomes (employment, independent living, good health and friends and relationships in the community) and lead to individualised destinations in work, living and community. Students attending these programmes grew from 252 in 2020-21 to 284 students in 2021-22, an 11% increase, with retention at 97% for the year. Achievements remained high in 2021-22: of the 37 students on high needs programmes who were working towards accreditation, 100% achieved accreditation relevant to their individual Education and Healthcare Plan (EHCP) and life goal. Within high needs programmes, overall sustainability of destinations after College remained strong, with 95% of students sustaining their onward destination 6 months after leaving OHC. Whilst not possible to compare pre-Covid sustainability data, this figure still represents strong outcomes for these students and is reflective of our aspirational approach within the College.

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Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

The College offers a range of work-related learning courses. The WorkStart programme suite comprises Supported Internships, Traineeships, inclusive Apprenticeships, Project Search, Pathway to Employment and Preparation for Employment. These programmes provide opportunities for students to gain relevant employability qualifications and work experience and to define their working ambitions for the future. They also give students, where appropriate, the opportunity to work towards achieving Functional Skills qualifications in English and maths. The courses are open to students who have experienced barriers to learning, including young people who are NEET (not in education, employment or training) as well as students with a learning difficulty or disability. A significant cohort of the students also have complex behaviours of concerns aligned to their disabilities. Numbers on Workstart programmes grew from 102 in 2020-21 to 127 in 2021-22, an increase of 20%. Outcomes continued to be positive for Workstart students: overall retention during 2021-22 was 97%, with 90% of students on these programmes progressing into work and/or further education. OHC is the education provider for Project Search in Hillingdon, working with the Local Authority and Hillingdon Autistic Care and Support to deliver one-year supported internships with the aim of securing paid employment for participants. During 2021-22, the College was named as education provider in a similar partnership with Sutton & St Helier Hospital. Project Search will commence in Sutton from September 2022.

The College has effective links with over 80 employers and community-based programmes; these provide outstanding progression into local supported living schemes, supported employment, internships and volunteering and Further Education and Adult Community programmes, as well as enhancing students’ educational and pastoral experience during their time with us. In addition to existing partnerships, new projects initiated throughout the year include: working with Crawley College and AoC to broaden access to mainstream FE provision for young people with medical needs; a partnership with Kingston University which has successfully enabled students’ access to software such as Spotify; and a five-year funded project with SeeAbility and the NHS, improving OHC students’ access to eye care in order to improve cognitive and communicative ability.

The College offers apprenticeship programmes in Customer Service and Supporting Teaching and Learning and specialises in inclusive apprenticeships. The apprenticeship programme was inspected by Ofsted for the first time in November 2019 and was judged as Good. Our robust internal assessment, that includes the judicious use of Ofsted-trained external verifiers, which evidences that the programme continues to be Good. Apprentices are making good progress and taking on more responsibilities in the workplace. 10 apprentices had timely completion rates in 2021-22 with 100% retention and 100% achievement rates, and 90% remain in employment. 4 inclusive apprenticeships are included in the above figures. 70% gained a Distinction grade following End Point Assessment.

Throughout 2021-22 the College continued to follow all Covid-19 guidance with risk assessments in place and remained open throughout this period. OHC continued to implement its award-winning recovery curriculum, which supports students in returning to College following Covid disruption including blended/home learning, isolation or shielding. The Covid Catch-up fund has been used effectively to support the safeguarding, mental health and wellbeing of students. To ensure that the additional funds were deployed to students, the College set up the Creative Arts Therapist locum team, which worked across all regions, offering a range of responsive therapy, including Art Therapy, Music Therapy and Drama therapy to students who had been impacted by covid, whether via a direct bereavement or heightened anxiety following the pandemic or other concerns. This enabled the College to respond quickly to urgent referrals, picking up students within 1-3 weeks from referral. The College did see a rise in referrals around anxiety and were able to respond swiftly. Twenty students were able to be referred and picked up between January and July 2022 for an immediate response, including three urgent safeguarding concerns.

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Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

In 2021-22 the College also launched the Duke of Edinburgh Award Scheme, with 13 students completing their gold achievers, bronze and silver awards. In December 2021 the lecturer leading on DoE was one of only 50 people nationwide to be recognised with a prestigious Duke of Edinburgh coin.

Safeguarding across the College continues to be outstanding, underpinned by a robust set of policies, procedures and training for all staff, which are informed by the SEND-specialist knowledge of OHC leaders and practitioners. All staff receive training as part of their annual safeguarding update as well as bespoke training and refreshers throughout the year. The College Designated Safeguarding Lead (DSL) works closely with the Director of Safeguarding & Wellbeing and participates in the crossorganisational DSLs’ network with OHCAT DSLs. This has continued to be a rich source of knowledge exchange and resource sharing throughout 2021-22, enabling a consistent and evidence-led response to current safeguarding issues, as well as greater triangulation of compliance requirements. Through delivery of a bespoke curriculum including relationships, sex and health education, e-safety and British values, students learn how to safeguard themselves and how to apply this knowledge in a variety of settings, particularly focusing on contextual safeguarding in their local communities.

The College continues its journey in securing Trauma Informed status. The process of becoming trauma informed has involved training at all levels, enabling staff to feel more confident when supporting students who may require additional support with their mental health. Following 2020-21’s whole staff and Senior Leadership training, in 2021-22 five members of staff obtained their Diploma in Trauma and Mental Health. As a result, key staff are able to support across the College with the wider strategy, which includes approaches and training. In 2021-22 the College also expanded its pool of trained Mental Health First Aiders (MHFAs) and implemented a supervision programme for MHFAs, to further strengthen support for students and staff.

OHC has a comprehensive and highly effectively CPD (Continuing Professional Development) programme in place to ensure that staff receive high quality training and development pertinent to their job role and to support succession planning. All staff access regular training on key compliance areas such as safeguarding, Positive Behaviour Support (PBS) and Team Teach, manual handling and therapeutic approaches to underpin curriculum delivery, as well as a range of specialist CPD focused on best practice within SEND. Alongside regular INSET days, OHC runs a full Training Week in October half term and an annual Development Planning Day for all staff. Training Week took place 18-22[nd] October 2022 across all centres, with staff accessing individualised training programmes spanning compliance matters and specialism-focused content. Development Planning Day was held at Twickenham Stadium on 22[nd] April 2022, with keynotes from external speakers on exploitation and gang violence, as well as staff wellbeing within an educational context, alongside OHC and wider Trust updates, strategic discussions and team building exercises.

The College delivers the Diploma in Education & Training (DET) SEND specialist pathway, validated by Canterbury Christ Church University (CCCU), which offers staff a route into qualified teaching and a clear career progression pathway within the organisation. During 2021-22, 14 OHC and Trust staff joined in Year 1 and the full cohort of 16 staff progressed to Year 2 of the course. In addition, 13 external DET students took up the specialist pathway, enabling OHC to further disseminate SEND best practice to organisations including Ambitious About Autism, White Rocks Farm, Beyond Autism and Drumbeat School.

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Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

OHC offers Level 1 and 2 Functional Skills in maths and English for all staff members who do not yet hold such qualifications. During 2021-22, the College delivered Level 1 and 2 Functional Skills English and maths courses to staff from OHC and OHCAT. Leaders and managers have an individualised CPD programme, including one Deputy Principal undertaking an NPQH and one Head of College undertaking a Level 7 leadership and management apprenticeship.

The Principal and Senior Leadership Team (SLT) continue to make a regional and national contribution to government and advisory groups, influencing policy for the benefit of all students and the wider community. During 2021-22 members of the College SLT were represented on national, regional and local bodies including:

♦ London Councils’ Young People Education and Skills Board
♦ The London Implementation Group
♦ Natspec’s national committee
♦ PBS Alliance National Steering Group and Schools and Colleges Community of Practice,
♦ Contributing to National Guidelines in Learning Disabilities for The Royal College of Speech & Language Therapy
♦ AoC’s Prevent Pilot Board
♦ AoC’s Sports Inclusion Hub
♦ Sutton Local Safeguarding Board

The College Senior Leadership Team are regularly asked to speak regularly at regional and national conferences.

The wider OHC&AT team also includes current and former badged Ofsted inspectors for both schools and further education. During 2021-22, articles on College practice were published in the NASEN journal and SEN magazine.

Orchard Hill College sponsors Orchard Hill College Academy Trust, which supports the development of high-quality educational provision for children and young people with SEND. The symbiotic relationship between College and Trust promotes collaborative working and enables a two-way flow of best practice and specialist knowledge which enriches and strengthens the student experience on both sides, as well as smoothing transitions for students moving from school to College. Working as a group enables the College to share good practice, to gain from the knowledge and expertise of colleagues in the academies, and to support smoother transitions for the students who are moving from school to college.

FINANCIAL REVIEW

Results for the year

A summary of the results for the year can be found on page 24 of the financial statements.

Income for the year totalled £17,705,000 (2021: £17,902,000). The major part of this income is in relation to core grants from the Education and Skills Funding Agency (ESFA) of £5,074,000 (2021: £4,742,000), funding from Local Authorities for educational contracts of £11,944,000 (2021: £11,005,000) and services provided to academies of £78,000 (2021: £297,000).

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Trustees’ report (including Strategic Report) 31 July 2022

FINANCIAL REVIEW (continued)

Results for the year (continued)

Expenditure for the year, which principally related to the provision of education, totalled £19,682,000 (2021: £16,976,000).

The net loss for the year ended 31 July as shown on the statement of financial activities was £1,977,000 (2021: net income of £926,000). Excluding the pension current service cost and interest cost adjustments in relation to the Local Government Scheme required by FRS 102 of £2,132,000 (2021: £1,220,000), the net position would be a surplus of £155,000 (2021: surplus of £664,000).

Financial position and reserves policy

As at 31 July 2022, the balance sheet included net assets totalling £1,209,000 (2021: net liabilities of £5,112,000). This is comprised of:

♦ The Tangible Fixed Assets fund of £3,612,000 (2021: £4,147,000). This fund represents the net book value of the College’s tangible fixed assets net of any associated lease obligations and has been separated on the balance sheet in recognition of the fact that these assets are essential to the day-to-day operation of the College, and the value of the assets can therefore not be considered as realisable. During the year there was a relocation of one of the centres in Hillingdon, this has resulted in a write off of assets and a provision for potential dilapidation costs in the current year.
♦ The negative Pension Reserve fund of £8,149,000 (2021: £14,315,000). This fund reflects the College’s share of the net liability in respect of the Local Government Pension Scheme. This fund has been separated on the College’s balance sheet in order to distinguish the liability from the operational liabilities which form part of the College’s working capital.
♦ The Unrestricted General Fund of £5,746,000 (2021: £5,056,000) are funds which are not represented by the tangible fixed assets fund, the pension reserve fund, restricted, or otherwise designated, and are in effect the College’s free reserves which are immediately available for general charitable use.

Maintaining an appropriate level of financial reserves is considered essential in protecting the charity from financial risk generated by, for example:

♦ Income reduction due to Government funding changes;
♦ Unexpected falls in student numbers;
♦ Cash flow issues due to delays in receipt of funding; and
♦ Emergencies.

In general, it is considered prudent to maintain a level of usable reserves sufficient to cover unexpected and unplanned events so that the individual College’s primary objective is preserved. At the same time, the College wishes to ensure that it uses its funding to benefit the students in its care which implies an imperative to consider actively the use of reserves to enhance educational provision.

The Board of Trustees monitors levels of reserves in financial reports provided by the Chief Finance Officer. Trustees look to ensure that a prudent level of reserves is maintained, bearing in mind the recurrent spending needs to ensure high quality provision. In deciding the level of reserves, Trustees take into account the following:

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Trustees’ report (including Strategic Report) 31 July 2022

FINANCIAL REVIEW (continued)

Financial position and reserves policy (continued)

♦ One month’s salary bill;
♦ The College’s annual budget;

The need for any large project spend such as facilities development or building condition needs; Any uncertainty, turbulence or expected reduction in funding arrangements, including the level of transitional protection within the College funding and its expiry date; and

Anticipated funding over the next three years. As a prudent measure, the College will aim for between 45 and 60 consecutive days of free reserves based on annual expenditure before depreciation and pension adjustments.

During the year the College achieved free reserves of 120 days based on the free reserves balance at 31 July 2022 of £5,746,000 (£5,056,000) (2021: 121 days). General reserves will support the next phase of investment in the College premises, including the refurbishment of the Hillingdon site, as identified in the estate’s strategy. Furthermore, £138,000 has been ring-fenced for LGPS deficit repayments due between August 2022 and March 2023.

Fundraising

The College accesses funds for specific projects that will benefit existing and future students where funds for these projects cannot be accessed via existing channels i.e. government education funding. The College will access funds for projects that will provide opportunities and enhance the learning experience and environment for students.

The code of fundraising practice is followed (https://www.fundraisingregulator.org.uk/code).

The College does not use commercial organisations to support its fundraising activities. There were no complaints concerning the College’s fundraising activities during the year.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Constitution

The College is an independent charitable company. The Company Registration Number is 07586715 and the Charity Registration number is 1144922. The College’s primary governance document is the Articles of Association.

As a charity and company limited by guarantee, Orchard Hill College is governed by a Board of Directors (also referred to as Trustees) who are responsible for, and oversee, the management and administration of the College. The Trustees have overall responsibility and ultimate decision-making authority for all the work of the College. This is largely exercised through strategic planning and the setting of policy. It is managed through business planning, monitoring of budgets, performance management, the setting of standards and the implementation of quality management processes.

The Trustees (who are ultimately responsible for the delivery of the College’s objectives) are supported by an Executive Senior Leadership Team (ESLT) which includes the CEO, College Principal, Executive Principal/Deputy CEO, the Chief Finance Officer, the Chief Operating Officer and the Executive Director of Development. The services of ESLT (excluding the College Principal) are provided to the College by OHCAT as part of the core service charge service level agreement.

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STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Constitution (continued)

Local governance of the College falls to the College Committee, which is a committee formed by the Directors and which derives its power from them. The College Committee is responsible for fulfilling a largely strategic role in the conduct of the College and is supported by the College Senior Leadership Team (SLT) in conjunction with the Principal who is responsible for the internal organisation, management and control of the College. The Directors may also delegate responsibility to the Principal.

The College’s Senior Leadership Team comprises the Principal, five Heads of College and four deputy Heads of College, who oversee the curriculum budgets of the College centres along with a Director of Operations, who helps to oversee all the College centres.

The College employs a Head of Corporate Governance, an experienced Governance professional with over 30 years’ experience in the governance sector. The Head of Corporate Governance reports directly to the Executive Director of Development who is qualified and experienced in corporate and school governance.

The Head of Corporate Governance maintains her professional development through engaging in regular training and further education briefings. These have been online this year due to the pandemic. She is also a member of the FE Clerks’ network, a forum that shares good practice and information from the FE Governance sector.

Orchard Hill College has four Members, to whom the Board of Trustees report (see page 1 for details). The College operates a portfolio governance system, assigning strategic areas to directors and governors of the College Committee via skills matching. The portfolio governance arrangements for Directors and College Committee members which existed during the financial year is set out below:

Organisational structure

Organisational structure
Portfolio	OHC Director	OHC Committee member
Ethos,Vision and Strategy	Peter Lauener	Dave Hobday
Teachingand Learning	Vacancy	Michele Humphreys
Finance and Resources	Akansha Arya (appointed 25.3.22)	Akansha Arya
Health and Safety, Safeguarding and Child Protection	Julie Avis	Neil Mears
Business Development and Marketing	Rama Venchard	Helen Norris
HR and Organisational Development	Simon Fryer	Ric Adams

The Board normally meets formally three times a year during the second half of each term. To maintain financial oversight, the Chief Financial Officer also meets with the Finance Portfolio holder termly, the Finance Portfolio holder will feedback on these meetings to other Board members between formal meetings. During the period that the Finance and Resources Portfolio Holder post was vacant (Until March 2022), oversight was delegated to the OHCAT Finance Portfolio Holder in order to ensure continuity of financial probity and scrutiny. In addition, TIAA Ltd performed an annual Internal Audit programme to provide Trustees with additional assurances on key risks focussing on Key Finance Systems, Procurement, Risk Management, Safeguarding, ICT Disaster recovery and GDPR. Financial management is monitored by the Executive Senior Leadership Team at monthly meetings and through regular departmental budget meetings.

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STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Organisational structure (continued)

Orchard Hill College Academy Trust was established in 2013 by Orchard Hill College, in response to a request from the London Borough of Sutton and the DfE to sponsor Carew Manor School (now Carew Academy). The College and the Trust are independent legal entities that form a family of providers, collectively known as Orchard Hill College and Academy Trust (OHC&AT), working for the benefit of students and pupils in local communities.

The College and the Academy Trust operate a collaborated ‘family’ Board of Trustees, as shown below. This model of governance has proven to be a great success, allowing greater coherence in decisionmaking and greater clarity of communication while retaining the individuality of each organisation. Risk continues to be managed separately and collaboratively, allowing either organisation to retract from the collaboration if required while at the same time promoting transparency. In addition to the Remuneration Committee, the collaborated Board of Trustees also operates an Audit and Risk Committee, Finance and Resources committee, Safeguarding Oversight Committee (first meeting held on 11.06.21), Quality and Standards committee (first meeting held on 10.6.22) and a Chairs’ Committee.

Connected organisations

The College and Academy Trust work closely together and are responsive to the requirements of each other and of academies within the Trust. The aligned Executive Senior Leadership Team (ESLT) maintains a close working relationship with the College Senior Leadership Team as well as those of each academy, and learning support is provided to the academies by the College in a number of areas, including therapy, training and digital learning. The Academy Trust provides operational support to the College in a number of areas including HR, IT, Finance and Facilities.

The College is represented as one of the members of the Academy Trust, and may appoint Directors to the Board of the Academy Trust in agreement with all other Trust members.

Trustees

The Trustees (Directors) who served during the period and up to the date of approval of the report are included on page 1.

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Trustees’ report (including Strategic Report) 31 July 2022

STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Trustees (continued)

All new Trustees receive an induction on appointment and receive regular briefings from the ESLT and other senior leaders. All Members, Trustees and Governors have access to GovernorHub, a comprehensive online governance portal which includes online training and resources. All Members, Trustees and Governors have access to Educare, a comprehensive online training package, as well as the National Governance Association’s online training modules, both of which offer key compliance modules around safeguarding, health and safety and equality and diversity, as well as wider areas of interest. The College also offers bespoke training sessions on request. Additionally, the College and OHCAT jointly hold an annual governors’ conference, offering Trustees and LGB governors across both organisations the chance to take part in training and development opportunities as well as networking. The 2021-22 governor conference was held in October 2021, with an agenda that included strategic updates, safeguarding and health and safety training, and discussion on the portfolio governance system.

All new Governors receive a comprehensive induction pack and an introductory training session and are actively encouraged to participate in the relevant training offered, enabling them to understand their role within the College and the wider family formed with OHC&AT. As part of the portfolio governance arrangements, portfolio holders are also paired with members of College staff and expected to meet two to three times each year, or more as required, to discuss progress and any issues that may have arisen.

Key management personnel

The Trustees consider the key management personnel for the College to include:

♦ The Trustees: and
♦ The Executive Senior Leadership Team:
The CEO
The Executive Principal/Deputy CEO
The College Principal
The Chief Finance Officer
The Chief Operating Officer
The Executive Director of Development

The Executive Senior Leadership Team (except for the College Principal) all offer their services on a Service Level Agreement arrangement with OHCAT and are not employees of the College.

The OHC&AT Board has appointed an OHC&AT Remuneration Committee to consider salaries for senior post holders including the key management personnel of the College.

The OHC&AT Remuneration Committee is comprised of four members as follows:

♦ Chair of OHC Board of Trustees
♦ Chair of OHCAT Board of Trustees.
♦ OHC Trustee
♦ OHCAT Trustee

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STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Key Management Personnel (continued)

The quorum for the meeting is two members (one member from each Board). The Remuneration Committee makes recommendations to the OHC&AT Board for approval. The Executive Senior Leadership team are awarded a spot salary. The Trustees, except for the CEO, who is also a Trustee of the charitable company, did not receive any remuneration for their services to the College in the period of report; as noted above, the CEO is remunerated by Orchard Hill College Academy Trust and the College is recharged by the Academy Trust for his time under a service level agreement.

The following factors are taken into account when considering the level of remuneration:

♦ Skills, experience and responsibilities;
♦ Performance appraisals;
♦ Annual turnover;
♦ Range of salaries for senior post holders in similar organisations;
♦ Retention;
♦ Average cost of living and incremental pay for all staff; and
♦ Role changes.

Statement of Trustees’ responsibilities

The Trustees (who are also Directors of Orchard Hill College for the purposes of company law) are responsible for preparing the Trustees’ report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).Company law requires the Trustees to prepare financial statements for each financial period which give a true and fair view of the state of affairs of the charitable company and of the income and expenditure of the charitable company for that period.

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

♦ select suitable accounting policies and then apply them consistently;
♦ observe the methods and principles in Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable to the United Kingdom and Republic of Ireland (FRS 102);
♦ make judgements and estimates that are reasonable and prudent;
♦ state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
♦ prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in operation.

The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company 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 charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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Statement of Trustees’ responsibilities (continued)

Statement of Trustees’ responsibilities (continued)Each of the Trustees confirms that:

♦ so far as the Trustee is aware, there is no relevant audit information of which the charitable company’s auditor is unaware; and
♦ the Trustee has taken all the steps that he/she ought to have taken as a Trustee in order to make himself/herself aware of any relevant audit information and to establish that the charitable company’s auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006.

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

FUTURE PLANS

Orchard Hill College and the OHC&AT family of providers

Orchard Hill College, together with Orchard Hill College Academy Trust, operates as a collaborative family of specialist providers. Our mission is to support, enable and champion the talents, skills and rights of the most complex and vulnerable people in our society, in order that we can release their potential, promote their wellbeing and transform their lives. As a community of learners, families and colleagues we believe that by working collaboratively, with energy and ambition, we can always effect positive change. At the core of our ethos is the conviction that there should be no limit placed on what is possible and that everyone has the ability to be the very best they can be.

Our learners require and receive a high-quality blended offer within their local context in order to meet their different needs and ambitions. By working together as a family, we can maximise the benefits to our pupils and students from having staff, leaders, governance and associates with extensive expertise and experience in both the special and mainstream sectors, from pre-school through to Further Education (FE).

Currently, the College offers specialist educational programmes for pupils and students aged 16 and over in six main centres and additional satellite provision in London and Surrey. The Trust operates 15 academies. Provision is organised on a hub model, with College centres and schools clustered around four hubs: Sutton and Croydon, North West London and Slough, South West London, and Surrey and Sussex. The hub model supports effective cross-organisational working and best use of resources to benefit every OHC&AT student. The College operates in a combination of co-located and communitybased centres, offering a curriculum closely aligned to the needs of pupils in each hub who are leaving OHCAT schools to attend the College. Each hub develops or forms partnerships with providers to ensure that resourced facilities may be accessed by multiple OHC&AT provisions as required; this may include vocational facilities, digital hubs, generic/specialist sports facilities, independent living practice suites.

The regional model is now well embedded across the organisation. OHC&AT operates a four-hub model:

♦ Sutton and Croydon – OHC Vocational Progression Centre, OHC Quadrant House, plus Carew Academy, The Link Primary School, The Link Secondary School and Addington Valley Academy;

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FUTURE PLANS (continued)

Orchard Hill College and the OHC&AT family of providers (continued)

♦ Northwest London and Slough – OHC Wyvern House (closed in July 2022 and replaced by Park View in August 2023), plus The PRIDE Academy (formerly Young People’s Academy), The Skills Hub and Arbour Vale School;
♦ Southwest London – OHC Beaconsfield, OHC Lomond House, OHC Camberwell Road, OHC Vocational Centre, plus Dysart School, St Philip’s School, Bedelsford School and Nightingale Community Academy;
♦ Surrey and Sussex –St Dominic’s School, Grafham Grange School, Brantridge School, Unified Academy.

The development of the hub model has supported both College and Trust to offset potential limitations associated with geographical dispersion. By growing local excellence alongside OHCAT academies, the College has been able to smooth transitions for students, provide additional learning opportunities through shared facilities and resources, and enable staff to build networks and share expertise. Each member of the College Senior Leadership Team acts as Regional Lead for a specific area or areas, liaising closely with both College centre staff and OHCAT academies in the hub to ensure that quality assurance, compliance processes and responsive localised support are robust.

The period under discussion has seen the continuation of a planned shift in focus and a further evolution of strategic priorities. Building on the rapid growth and expansion of OHC&AT’s (which implicitly implies the College) first seven years, phase two of the organisational strategy is structured around the following key priorities:

♦ Quality, standards and reputation: ensuring life-changing outcomes, meaningful destinations and quality of life for every young person within the organisation, through the delivery of consistently

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excellent teaching and learning across a rich and relevant curriculum offer;

FUTURE PLANS (continued)

Orchard Hill College and the OHC&AT family of providers (continued)

♦ Innovation and specialism: growing and developing the existing wealth of specialist knowledge within the organisation through the establishment of internal and external professional networks, robust impact measurement processes that feed into year-on-year strategic plans, and active engagement in research;
♦ Development and growth: taking an ambitious, judicious approach to securing the future of the organisation, through capacity building, maximising financial probity and efficiency, and the
♦ Strategic improvement of estates;
♦ System leadership: building influence and advocacy, and ensuring compliance and accountability, through a strong organisational culture that promotes responsive governance and leadership at all levels;
♦ Nurturing talent: future-proofing the organisation through a strategic approach to recruitment and retention, including training and development opportunities and career pathways that enable every staff member to maximise their potential within the College and the Trust.

In alignment with these strategic priorities, the College’s immediate future plans include further development of premises to meet local need, ongoing staff and whole organisational development around the specialisms associated with the cohort, and the further development of the digital offer to support students in and out of College. Following the successful addition of OHC Camberwell Road in 2020-21, OHC Robin Hood Lane opened in Sutton from September 2021, providing space for up to 30 Workstart and apprenticeship students as well as classroom space and a resource library for the Diploma in Education & Training. OHC and OHCAT continue to work with Achieving for Children (AfC), which provides children’s services in Kingston, and Kingston Council to progress a proposal for a post16 SEND campus for OHC and Dysart, St Philip’s and Bedelsford schools. The proposed campus is intended to offer local pathways to some young people already attending the special schools and to other local young people attending nearby who might benefit from having additional post-16 choice. As well as classroom spaces for young people with different needs and abilities, the campus would aim to ensure the provision of a flat for independent-living practice and a wide range of vocational workshops giving young people sustainable employability skills.

The College also ended its occupation of Wyvern House at the end of the 2021/22 academic year and moved this provision in to its new Hillingdon site, Park View, at the start of the 2022/23 academic year. Refurbishment works to the new centre will take at the start of 2022/23.

PRINCIPAL RISKS AND UNCERTAINTIES

The Trustees have assessed the major risks to which the College is exposed and have implemented strategies in order to manage those risks. The following key principles outline the College’s approach to risk management and internal control as set out in the Risk Management Policy:

♦ The Board of Trustees has responsibility for overseeing risk management within the College as a whole.
♦ An open and receptive approach to solving risk problems is adopted by the Board of Trustees.

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PRINCIPAL RISKS AND UNCERTAINTIES (continued)

♦ The Executive Senior Leadership Team and the Principal support, advise on and implement policies approved by the Board of Trustees.
♦ The College makes conservative and prudent recognition and disclosure of the financial and nonfinancial implications of risks.
♦ Senior and middle managers are responsible for ensuring good risk management practice within their designated managed area.
♦ Key risk indicators are identified and closely monitored on a regular basis.

Principal risks are detailed in the risk register, which is reviewed by the Board of Trustees each term. Key risks include:

Quality

The College currently operates eight related but separate centres, with additional satellite provision where necessary to meet demand. Ensuring the delivery of a transformative, high quality of education and pastoral care is the central mission of OHC and crucial to its continued success and growth. The College’s robust quality and progression monitoring framework is fully embedded, enabling a deep understanding at executive level of each centre and work stream’s strengths and areas for development to inform targeted improvement initiatives, underpinned by robust quantitative and qualitative data.

Compliance

The College is geographically dispersed across four regional hubs. In addition, the College works to an underlying principle of localism supported by a central function. Such a local and regional focus means that individual centres can be more responsive to the bespoke nature of their context. It also reduces the risk of micro-management from a central function that may be less well informed about the local landscape and impose less efficacious solutions. Overarching this approach is the core role that OHC&AT plays in the monitoring and assurance of each College centre and work stream and in relation to statutory policies and procedures, key stakeholder engagement and the promotion of OHC’s broader mission and vision more widely. The reciprocal risk of this approach is that on matters of compliance, local variations could result in inconsistencies across the organisation. Our well-developed and established risk assessment processes – particularly, but not exclusively, in relation to safeguarding, financial systems, processes and reporting, recruitment and statutory policies – ensure that the College has comprehensive executive oversight of risk and any behaviours that may be sub-optimal in relation to compliance, and is able to intervene appropriately, decisively and in a timely manner.

Recruitment

Recruitment continues to be a risk for the college. Whilst some provisions have more challenges due to local and/or circumstantial reasons, such as Uxbridge and Southwark all centres are experiencing challenges, which is consistent with the national picture. The cost-of-living challenges, alongside Covid and (no doubt at least to an extent, Brexit), coupled with higher rates of pay being offered in some other industries (for example retail), have made it more challenging to recruit to roles at the lower end of the pay scales. It is particularly difficult to attract Teaching Assistants and other support staff. This also applies to Integrated Services for the College (therapy and nursing), as availability of skilled personnel in this sector is diminishing. However, HR have diligently supported overseas recruitment for several members of Integrated Services staff and worked with key stakeholders to implement a reviewed set of terms and conditions for Integrated Services personnel that benchmark to the NHS Agenda for Change.

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PRINCIPAL RISKS AND UNCERTAINTIES (continued)

Recruitment (continued)

Over the past five years, the College has seen significant growth not only in numbers on roll but also the wide range of need and especially over the last few years we have seen an increasing pattern of students presenting with more profound and complex need which cannot be met within some of our centres. This is particularly pertinent for students within our two centres VPC and Lomond. By way of example, since 2018, Lomond college centre has provided 136 places to Southwark young people but we have not been able to provide places for a further 79 young people in that time.

The critical challenge currently facing the College is working within the constraints that some of the current buildings have. It has now come to a point where we have a mismatch between some of the accommodation and the demand for more complex student places. In order to meet the increased demand, we do need to work in partnership with local authorities to purchase or secure long term leases with enough building capacity to offer an innovative curriculum, to enable more young people to study in their local areas.

Infrastructure and capacity

In order to most effectively meet its strategic aims and objectives, the College requires an infrastructure for its business support services that enables it to operate in an efficient, coordinated and reliable way. Systems and processes are well established, appropriately supported and remain under active review by ESLT and Trustees in order to ensure that they are effective and fit for purpose. Central support, as well as delivery to students, requires sufficient capacity, in terms of quality, number of personnel and coherent organisational management in order to promote exceptional outcomes.

As both an outstanding provider and the sponsor of an Academy Trust, the College faces a range of potential challenges to its ability to continuously deliver high quality education and related services. The College and the Trust have taken steps to more closely align themselves in recent years, which increases the risk of issues impacting on both organisations rather than individually. The College has developed robust succession planning arrangements, developing leadership within the organisation and recruiting high quality staff in order to increase capacity, while strengthening cross-organisational support systems that encourage knowledge sharing and staff support targeted at areas of high demand. Internal reporting mechanisms have been synchronised across both organisations, allowing senior leaders to anticipate support needs and act rapidly in order to mitigate risk.

Over-expansion

Any organisation that expands too rapidly risks downturns in the quality of provision and financial overstretch, to the detriment of its reputation and quality. OHC has agreed a three-year strategy that allows for growth while retaining the focus on quality, standards and wellbeing. The current strategic focus is on growth in numbers of provisions through building on existing commissioning, as well as deepening and maturing the College’s work so that best practice is consolidated.

Business continuity

Interruptions to typical activity can have a negative impact on the offer provided to OHC students. In a dynamically shifting national, regional and local landscape, threats to normal business continuity are real and to the fore. OHC has a secure ethos, a clearly defined headline mission and vision, and a wellarticulated and understood set of values, in addition to an effective and responsive business support service. These combine to support the College to continue to deliver to a high standard even if working practices need to be adapted. Our suite of risk assessment and monitoring supports a detailed understanding of the overall operational picture across OHC at any given time.

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PRINCIPAL RISKS AND UNCERTAINTIES (continued)

Funding

The College is reliant on Government funding to support students whose additional support needs carry costs that exceed most other forms of ongoing funding. Variations in the funding methodology and levels of resource, as well as changes in eligibility criteria and uncertainty associated with major political events, create potential risk. OHC engages proactively with funding bodies to raise awareness of the potential impact of planned actions and maintains strong working relationships with external agencies in order to ensure that productive dialogue takes place at local, regional and national level. This risk is particularly acute in the forthcoming academic year and beyond, as inflation has significantly increased (to levels around 10% at the time of writing) this is directly impacting on the cost of attracting and retaining staff, the procurement of goods and services, in particular energy and the cost of borrowing which would be needed to support our estates strategy. This alongside a downward pressure to reduce pricing will have a double effect.

Risk Management

OHC regularly reviews the key risks to which its operations are exposed, together with the operating, financial and compliance controls that have been implemented to mitigate those risks. The Trustees are of the view that there is a formal ongoing process for identifying, evaluating and managing the College’s significant risks. In addition, factors are in place that provide the Trustees with the capacity to deal with issues or problems that occur, for example, calling on an experienced, capable Executive Senior Leadership Team, which can act quickly in response to unexpected events through forward planning, policies and insurance and through holding appropriate reserves. Additionally, the Board of Trustees has established an Audit & Risk Committee and a Finance & Resources Committee; membership of these committees is drawn from both OHC and OHCAT Trustees, and they report to the Trustees as a whole.

The overall responsibilities for the Audit Committee, on behalf of the OHC Trustees, are:

♦ Internal scrutiny – to have in place a process for checking financial systems, controls, transactions and risks and quality of provision.
♦ To achieve internal scrutiny which delivers objective and independent assurance.
♦ To provide assurance to Trustees that risks are being adequately identified and managed by:
♦ reviewing the risks; and
♦ agreeing a programme of work to address and provide assurance on those risks.

A risk report is submitted to the Trustees at each meeting and operational risks are reviewed at regular meetings of the Executive Senior Leadership Team and the CEO.

Trustees’ report, including Strategic Report, approved by the Board of Trustees and signed on its behalf by:

Mr P Lauener Trustee

9th December 2022

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Date: Independent auditor’s report to the members of Orchard Hill College

Opinion

We have audited the financial statements of Orchard Hill College (the ‘College’) for the year ended 31 July 2022 which comprise the statement of financial activities, the balance sheet, the statement of cash flows, the principal accounting policies, and the notes to the financial statements. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

♦ give a true and fair view of the state of the College’s affairs as at 31 July 2022 and of 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 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 College in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

The other information comprises the information included in the annual report and financial statements other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report and financial statements. 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.

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Other information (continued)

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

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’ report, which is also the directors’ report for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
♦ the trustees’ report, which is also the directors’ report for the purposes of company law, 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 College and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ report including the strategic report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

♦ adequate accounting records have not been kept; or
♦ the financial statements are not in agreement with the accounting records and returns; or
♦ certain disclosures of trustees’ 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 take advantage of the small companies’ exemptions in preparing the trustees’ report and from the requirement to prepare a strategic report.

Responsibilities of Trustees

♦ adequate accounting records have not been kept; or
♦ the financial statements are not in agreement with the accounting records and returns; or
♦ certain disclosures of trustees’ remuneration specified by law are not made; or
♦ we have not received all the information and explanations we require for our audit.

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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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

♦ the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
♦ we identified the laws and regulations applicable to the College through discussions with management, and from our knowledge and experience of the sector;
♦ we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the College, including the Charities Act 2011, Companies Act 2006, funding agreements with the ESFA and associated funding rules, ESFA regulations, data protection legislation, anti-bribery, safeguarding, employment, health and safety legislation;
♦ we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
♦ identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the College’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

♦ making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
♦ considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

♦ performed analytical procedures to identify any unusual or unexpected relationships;
♦ tested journal entries to identify unusual transactions; and

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Auditor’s responsibilities for the audit of the financial statements (continued)

♦ assessed whether judgements and assumptions made in determining the accounting estimates set out in the accounting policies were indicative of potential bias;

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

♦ agreeing financial statement disclosures to underlying supporting documentation;
♦ reading the minutes of trustee meetings; and
♦ enquiring of management as to actual and potential litigation and claims.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of noncompliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the trustees and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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

Use of our report

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

Katharine Patel (Senior Statutory Auditor) For and on behalf of Buzzacott LLP Statutory Auditor 130 Wood Street London EC2V 6DL

Date: 19 December 2022

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Statement of financial activities Year to 31 July 2022

Income and expenditure account Notes	Unrestricted funds £’000	Restricted funds £’000	31 July 2022 Total funds £’000	31 July 2021 Total funds £’000
Income from: Donations and legacies 1 Charitable activities . Provision of education 2 Other trading activities 3 Investments 4 Other items: pension liability transferred 5 Total income Expenditure on: Charitable activities . Provision of education 6 Total expenditure Net (expenditure) / income Other recognised gains and losses Actuarial gains (losses) on defined benefit pension scheme 19 Net movement in funds Reconciliation of funds Fund balances brought forward at 1 August 2021 Fund balances carried forward at 31 July2022	16 17,252 274 4 —	— 159 — —	16 17,411 274 4 —	1,026 16,339 80 1 456
	17,546	159	17,705	17,902
	19,523	159	19,682	16,976
	19,523	159	19,682	16,976
	(1,977) 8,298	— —	(1,977) 8,298	926 (3,016)
	6,321 (5,112)	—	6,321 (5,112)	(2,090) (3,022)
	1,209	—	1,209	(5,112)

All recognised gains and losses are included in the above statement of financial activities.

All of the College’s activities derived from continuing operations during the period of report.

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Balance Sheet 31 July 2022

31 July 2022 £’000	31 July 2022 £’000	31 July 2021 £’000	31 July 2021 £’000
1,216 7,185	4,897 5,726	995 6,729	5,450 5,038
8,401 (2,675)		7,724 (2,686)

	10,623 (1,265)		10,488 (1,285)
	9,358 (8,149)		9,203 (14,315)
	1,209		(5,112)
	3,612 (8,149) 5,746		4,147 (14,315) 5,056
	1,209		(5,112)

Approved by the Board of Trustees and signed on its behalf by:

Mr P Lauener Trustee

Date: 9 December 2022

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Statement of cash flows 31 July 2022

Notes	31 July 2022 £’000	31 July 2021 £’000 1,367 1 (855) (854) (15) — (15) 498 6,231 6,729
Cash flows from operating activities: Net cash provided by operating activities A Cash flows from investing activities: Bank interest receivable Purchase of tangible fixed assets Net cash used in investing activities Cash flows from financing activities: Interest on finance lease obligation Repayment of finance lease obligation Net cash used in financing activities Change in cash and cash equivalents in the year Cash and cash equivalents at 1 August 2021 B Cash and cash equivalents at 31 July 2022 B	982
	4 (494)
	(490)
	(18) (18)
	(36)
	456 6,729
	7,185

Notes to the statement of cash flows for the year ended 31 July 2022

A Reconciliation of net income to net cash provided by operating activities

	31 July 2022 £’000	31 July 2021 £’000 926 555 — 1,071 149 (660) (251) (456) (1) 15 (365) 384 1,367
Net (expenditure) / income (as per the statement of financial activities) Adjustments for: Depreciation charge Loss on disposal of tangible fixed assets Defined benefit pension scheme service cost adjustment Defined benefit pension scheme finance cost adjustment Adjustment in respect of value of property inherited at conversion from LA Adjustment in respect of finance lease inherited at conversion from LA Pension liability transferred to Orchard Hill College Academy Trust Interest receivable Interest payable on finance lease obligation Decrease / (increase) in debtors (Decrease) / Increase in creditors Net cashprovided by operating activities	(1,977) 529 518 1,888 244 — — — (4) 18 56 (290)
	982

B Analysis of cash and cash equivalents

Analysis of cash and cash equivalents
	31 July 2022 £’000	31 July 2021 £’000 6,231 498 6,729
Cash at bank and in hand Change in cash and cash equivalents in the year Total cash and cash equivalents	6,729 456 7,185

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Statement of cash flows 31 July 2022

C Analysis of change in net debt

Analysis of change in net debt
	1 August 2021 £’000	Cashflows £’000	31 July 2022 £’000
Cash at bank Loans falling due within one year Loans falling due after more than one year Total	6,729 (18) (1,285)	456 (2) 20	7,185 (20) (1,265)
	5,426	474	5,900

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Principal accounting policies 31 July 2022

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are laid out below.

Basis of preparation

These financial statements have been prepared for the year ended 31 July 2022. The comparative results are for the year ended 31 July 2021.

The financial statements have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant accounting policies below or the notes to these accounts.

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) (Charities SORP FRS102), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Charities Act 2011.

The College constitutes a public benefit entity as defined by FRS 102.

The financial statements are presented in sterling and are rounded to the nearest thousand pounds.

Critical accounting estimates and areas of judgement

Preparation of the financial statements requires the Trustees and management to make significant judgements and estimates.

The items in the accounts where these judgements and estimates have been made include:

♦ the useful economic lives attributed to tangible fixed assets used to determine the annual depreciation charge;
♦ the assumptions adopted by the Trustees and management in determining the value of any designations required from the College’s general unrestricted funds;
♦ the present value of the Local Government Pension Scheme defined benefit liability depends on several factors that are determined on an actuarial basis using a variety of assumptions. The assumptions used in determining the net cost for pensions include the discount rate and salary increase rate. Any changes in these assumptions, which are disclosed in note 19, will impact the carrying amount of the pension liability; and
♦ the discount rate applied in relation to the carrying value of building finance lease obligations.

Assessment of going concern

The Trustees have assessed whether the use of the going concern assumption is appropriate in preparing these financial statements. The Trustees have made this assessment in respect to a period of at least one year from the date of approval of these financial statements.

The Trustees of the College have concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the College to continue as a going concern. The Trustees are of the opinion that the College will have sufficient resources to meet its liabilities as they fall due.

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Principal accounting policies 31 July 2022

Assessment of going concern (continued)

In forming this assessment, the Trustees have considered the impact of the current coronavirus pandemic on the College’s activities with a particular focus on its effect on the College’s financial position including income, expenditure and reserves; the College’s beneficiaries; and its employees. Whilst we acknowledge the disruption caused by the pandemic to the College’s day-to-day operations, we confirm that we do not consider this to be cause for material uncertainty in respect to the College’s ability to continue as a going concern. The College has sufficient liquid resources to continue for the foreseeable future, despite the current crisis.

Income

Income is recognised in the year in which the College has entitlement to the income, the amount of income can be measured reliably, and it is probable that the income will be received.

Grants

Grants are included in the statement of financial activities on a receivable basis. The balance of income received for specific purposes but not expended during the year is shown in the relevant funds on the balance sheet. Where income is received in advance of meeting any performance-related conditions there is not unconditional entitlement to the income and its recognition is deferred and included in creditors as deferred income until the performance-related conditions are met. Where entitlement occurs before income is received, the income is accrued.

Tuition fees and educational contracts

Fee and educational contract income is recognised in the year in which the education was delivered.

Donations

Donations are recognised on a receivable basis (where there are no performance-related conditions) where the receipt is probable and the amount can be reliably measured.

Assets donated to the College by Orchard Hill College Academy Trust have been accounted for based on the net book value of the asset in the Academy Trust balance sheet immediately before the date of transfer.

Net assets donated to the College by the London Borough of Sutton have been accounted for using the acquisition method. The assets and liabilities transferred were valued at their fair value and recognised in the balance sheet under the appropriate headings with a corresponding net amount recognised as net income in the statement of financial activities as donations income.

Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the College; this is normally upon notification of the interest paid or payable by the bank.

Expenditure

Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity.

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Principal accounting policies 31 July 2022

Expenditure (continued)

Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources.

Expenditure headings are as follows:

a. Expenditure on raising funds - This includes all expenditure incurred by the College to raise funds for its charitable purposes and includes costs of all fundraising activities events and non-charitable trading.
b. Expenditure on charitable activities - These are costs incurred on the College’s educational operations, including support costs and costs relating to the governance of the College. Governance costs comprise the costs involving the public accountability of the College (including audit costs) and costs in respect to its compliance with regulation and good practice.

All expenditure is inclusive of irrecoverable VAT.

Tangible fixed assets

All assets costing more than £2,000 and with an expected useful life exceeding one year are capitalised.

All assets are stated at cost less depreciation.

Depreciation has been calculated at the following rates in order to write off each asset over its estimated useful life:

♦ Leasehold Buildings – to match the length of the lease subject to impairment review.
♦ Motor Vehicles - 25% (4 years) straight line.
♦ Furniture & Equipment - 25% (4 years) straight line.
♦ Computer Equipment & Software - 33.33% (3 years) straight line.
♦ Major Works (£50,000 - £100,000) - 10%-20% (5-10 years) straight line.

Depreciation on assets in the course of construction is not charged until they are brought into use.

Debtors

Debtors are recognised at their settlement amount, less any provision for non-recoverability. Prepayments are valued at the amount prepaid. They have been discounted to the present value of the future cash receipt where such discounting is material.

Cash at bank and in hand

Cash at bank and in hand represents such accounts and instruments that are available on demand or have a maturity of less than three months from the date of acquisition. Deposits for more than three months but less than one year have been disclosed as short-term deposits. Cash placed on deposit for more than one year is disclosed as a fixed asset investment.

Orchard Hill College 30

Principal accounting policies 31 July 2022

Creditors and provisions

Creditors and provisions are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Creditors and provisions are recognised at the amount the College anticipates it will pay to settle the debt. They have been discounted to the present value of the future cash payment where such discounting is material.

Pension costs

Retirement benefits to employees of the College are provided by the Teachers’ Pension Scheme (‘TPS’) and the Local Government Pension Scheme (‘LGPS’). These are defined benefit schemes.

The TPS is an unfunded scheme and contributions are calculated to spread the cost of pensions over employees’ working lives with the College in such a way that the pension cost is a substantially level percentage of current and future pensionable payroll. The contributions are determined by the Government Actuary based on quadrennial valuations using a prospective unit credit method. The TPS is a multi-employer scheme and there is insufficient information available to use defined benefit accounting. The TPS is therefore treated as a defined contribution scheme for accounting purposes and the contributions recognised in the year to which they relate.

The LGPS is a funded scheme, and the assets are held separately from those of the College in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit credit method and discounted at a rate equivalent to the current rate of return on a high-quality corporate bond of equivalent term and currency to the liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The amounts charged to operating surplus are the current service costs and the costs of scheme introductions, benefit changes, settlements and curtailments. They are included as part of staff costs as incurred.

Net interest on the net defined benefit liability is also recognised in the statement of financial activities and comprises the interest cost on the defined benefit obligation and interest income on the scheme assets, calculated by multiplying the fair value of the scheme assets at the beginning of the period by the rate used to discount the benefit obligations. The difference between the interest income on the scheme assets and the actual return on the scheme assets is recognised in other recognised gains and losses.

Actuarial gains and losses are recognised immediately in other recognised gains and losses.

Leased assets

Rentals applicable to operating leases where substantially all the benefits and risks of ownership remain with the lessor are charged on a straight-line basis over the lease term.

Assets held under finance leases and hire purchase contracts are capitalised and depreciated over their useful economic lives (or the term of lease if shorter). The corresponding lease or hire purchase obligation is treated in the balance sheet as a liability. The interest element of rental obligations is charged to the statement of financial activities over the year of the lease at a constant proportion of the outstanding balance of capital repayments.

Orchard Hill College 31

Principal accounting policies 31 July 2022

Fund accounting

Restricted funds are monies raised for, and their use restricted to, a specific purpose, or donations subject to donor-imposed conditions.

Designated funds comprise monies set aside out of unrestricted funds for specific future purposes or projects, including:

♦ The tangible fixed assets fund represents the net book value of the College’s tangible fixed assets.
♦ The pension reserve fund represents the net defined benefit pension scheme liability is respect to the LGPS.

Unrestricted general funds comprise those monies which may be used towards meeting the objectives of the College at the discretion of the Trustees.

Orchard Hill College 32

Notes to the financial statements 31 July 2022

1 Income from donations and legacies

Income from donations and legacies
	Unrestrictedfunds
	31 July 2022 Total funds £’000	31 July 2021 Total funds £’000
Donations Adjustment to net assets transferred from the London Borough of Sutton in October 2015 (see below)	16 —	— 1,026
	16	1,026

The long leasehold interest in various properties transferred from the London Borough of Sutton to Orchard Hill College in October 2015. These properties were originally recognised on the College's balance sheet based upon an estimate of its fair value which, in the absence of sufficient market activity data at the time, was determined with professional assistance with reference to the properties' depreciated replacement cost. For one such property, better information pertaining to the property's market value at October 2015 has since become available, and as such, an adjustment was made in the year ending 31 July 2021. The original book value of the property (taken to be its deemed cost for reporting purposes going forward) - had an uplift of £660,000. The valuation was determined with professional assistance.

The finance lease obligation of a second property transferred from the London Borough of Sutton in October 2015 had been overstated as the primary rent had been calculated for the full term of the lease (March 2049) despite there being a rent-free period between April 2029 and March 2049. As a result, the liability on conversion had been overstated by £366,000 (note 14) this was corrected in the year ending 31 July 2021.

Overall, the total adjustment for the year ending 31 July 2021 to the net assets transferred from the local authority is £1,026,000.

2 Income from charitable activities: Provision of education

Educational Skills Funding Agency: - 16-19 funding - 19+ funding Local Authority educational contracts Other educational operations Covid-19 additional funding (DfE/ESFA) - Catch-up premium (Tuition Fund) - Mass testing funding Covid-19 additional funding (non-DfE/ESFA) Total 2022 Total 2021	Unrestricted funds £’000 4,058 971 11,944 279 — — — 17,252 16,170	Restricted funds £’000 47 (2) — — 114 — — 159 169	Orchard Hill College33 31 July 2022 Total funds £’000 31 July 2021 Total funds £’000 4,105 3,701 969 1,040 11,944 11,005 279 483 114 41 — 22 — 47 17,411 16,339 16,339

Notes to the financial statements 31 July 2022

3 Income from other trading activities

Income from other trading activities
Miscellaneous income	Unrestrictedfunds 31 July 2021 £’000 31 July 2021 £’000 274 80
	31 July 2021 £’000 274

4 Income from investments

Income from investments
Bank interest receivable	Unrestricted funds
	31 July 2022 £’000 4	31 July 2021 £’000
		1

5 Income from other items

Income from other items
Pension liability transferred to Orchard Hill College AcademyTrust(see below)	Unrestricted funds
	31 July 2022 £’000 —	31 July 2021 £’000
		456

In October 2018, 73 members of central services staff were transferred from Orchard Hill College to Orchard Hill College Academy Trust. During the year ended 31 July 2021, additional employees were identified and their net liability of £456,000 was transferred to the Academy Trust.

6 Expenditure on charitable activities: Provision of education

Staff costs (note 9) Educational supplies Allocated support costs (note 7) Year ended 31 July 2021	Unrestricted funds £’000	Restricted funds £’000 — 159 — 159 145	31 July 2022 Total funds £’000 13,476 892 5,314 19,682 16,976	31 July 2021 Total funds £’000
	13,476 733 5,314			11,261 1,133 4,582
	19,523			16,976
	16,831

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Notes to the financial statements 31 July 2022

7 Support costs

Support costs
Premises costs Administration costs Legal and professional fees Governance costs (note 8)	Unrestricted funds
	31 July 2022 Total funds £’000 2,582 2,678 17 37 5,314	31 July 2021 Total funds £’000
		2,043 2,502 11 26
		4,582

Administration costs above include £2,267,560 for the core service charge and business support services bought from Orchard Hill College Academy Trust (2021: £2,191,737). See also note 20 to these financial statements.

8 Governance costs

Governance costs
External auditor’s remuneration - Audit services - Other services Internal auditor’s remuneration	Unrestrictedfunds
	31 July 2022 £’000 24 5 8 37	31 July 2021 £’000
		20 3 3
		26

9 Staff costs

Wages and salaries Social security costs Pension costs: . TPS contributions payable . LGPS contributions payable . LGPS service cost adjustment Severance payments	31 July 2022 £’000 9,528 653 438 973 1,888 (4) 13,476	31 July 2021 £’000
		8,215 603 470 865 1,071 37
		11,261

Staff numbers

The average number of persons employed by the College during the year was as follows:

Lecturers & management Teaching support staff Admin staff	31 July 2022 Number 59 199 11 269	31 July 2021 Number
		45 196 18
		259

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Notes to the financial statements 31 July 2022

9 Staff costs (continued)

Staff numbers (continued)

The number of employees whose annualised emoluments (including taxable benefits in kind but excluding employer pension costs) exceeded £60,000 were as follows:

£60,001 - £70,000 £70,001 - £80,000 £90,001 - £100,000 £100,001 - £110,000	31 July 2022 Number 2 4 — 1	31 July 2021 Number 4 3 2 —

Remuneration of key management personnel

The Trustees consider that they, together with the Executive Senior Leadership Team, comprise the key management personnel of the charity in charge of directing and controlling, running and operating the College on a day-to-day basis.

Trustees were not remunerated for their services to the College apart from the CEO, who is an employee of Orchard Hill College Academy Trust, and is remunerated by the College under a service level agreement with the Academy Trust (see note 20 Related Party Transactions).

The total remuneration of the Principal for the year ended 31 July 2022 (including employer pension contributions and employer national insurance contributions) was £139,000 (2021: £136,000 for services to Orchard Hill College and Orchard Hill College Academy Trust).

Other members of the Executive Senior Leadership Team are employed by Orchard Hill College Academy Trust and the split of the remuneration attributable to the College and the Academy Trust individually cannot be determined with sufficient reliability. The total remuneration (including employer pension contributions and employer national insurance contributions) of the Executive Senior Leadership Team (payable by Orchard Hill College Academy Trust) for the year ended 31 July 2022 was £795,000 (2021: £653,000).

As noted in the Trustees’ report, Orchard Hill College continues to be the academy sponsor of Orchard Hill College Academy Trust. Further information regarding transactions between the College and the Academy Trust is given in note 20.

Trustees’ expenses

Trustees may claim reimbursement for any out-of-pocket expenditure incurred in connection with their duties as Trustees of the College. During the year ended 31 July 2022, no trustee received reimbursement for travel and subsistence expenses (2021: £NIL).

10 Net income for the year

This is stated after charging:

Staff costs (note 9) Depreciation (note 11) Operating lease rentals External auditor’s remuneration	31 July 2022 £’000 14,423 529 214 29	31 July 2021 £’000 11,261 555 83 23

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Notes to the financial statements 31 July 2022

11 Tangible assets

Cost or valuation At 1 August 2021 Additions Disposals At 31 July 2022 Depreciation At 1 August 2021 Charge for the year Released on disposal At 31 July 2022 Net book values At 31 July 2022 At 1 August 2021	Long leasehold buildings £’000 5,951 378 (790) 5,539 999 314 (272) 1,041 4,498 4,952	Furniture and equipment £’000 2,393 116 (28) 2,481 1,895 215 (28) 2,082 399 498	Motor vehicles £’000 123 — — 123 123 — — 123 — —	Total £’000 8,467 494 (818) 8,143 3,017 529 (300) 3,246 4,897 5,450

At 31 July 2022, the College had capital commitments of £509,282 (2021: £381,000) in respect of orders placed for the year, these related to building works and motor vehicles.

12 Debtors

Educational fees receivable Due from Orchard Hill College Academy Trust (note 20) Prepayments and accrued income Other debtors	31 July 2022 £’000 179 297 460 280 1,216	31 July 2021 £’000 212 269 514 — 995

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Notes to the financial statements 31 July 2022

13 Creditors: amounts falling due within one year

Expense creditors Accruals Due to Orchard Hill College Academy Trust (note 20) Deferred income Finance lease obligation (note 14) Other taxation and social security Other creditors Movements on deferred income (included above) Balance brought forward at 1 August 2021 Income deferred in current reporting year end Amounts released to income from prior reporting year end Balance carried forward at 31 July2022	31 July 2022 £’000 54 670 626 518 20 285 502 2,675 196 518 (196) 518	31 July 2021 £’000 351 772 — 196 18 307 1,042 2,686 471 196 (471) 196

Deferred income in the main relates to funding received in advance from the ESFA and local authorities.

14 Creditors: amounts falling due after one year

Finance lease obligation	31 July 2022 £’000 1,265 1,265	31 July 2021 £’000 1,285 1,285

At 31 July 2022, the present value of future minimum lease payments in respect to finance lease obligations for the College was as follows:

Amounts falling due within one year (note 13) Amounts falling due after one year: . Amounts falling due between one to two years . Amounts falling due between two to five years . Amounts falling due after more than five years	31 July 2022 £’000 20 22 81 1,162 1,265 1,285	31 July 2021 £’000 18 19 74 1,192 1,285 1,303

The above obligations are in respect to long-leasehold properties transferred from the London Borough of Sutton and have been discounted at a rate of 4%.

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Notes to the financial statements 31 July 2022

15 Tangible fixed assets fund

At 1 August 2021 Net movement in year At 31 July2022	£’000 4,147 (535) 3,612

The tangible fixed assets fund represents the net book value of the College’s tangible fixed assets net of associated finance lease obligations. A decision was made to separate this fund from the general funds and other funds of the College in recognition of the fact that the tangible fixed assets are essential to the day-to-day work of the College and as such their value should not be regarded as funds that would be realisable with ease, in order to meet future contingencies.

16 Pension reserve fund

At 1 August 2021 Net movement in year At 31 July2022	£’000 (14,315) 6,166 (8,149)

The pension reserve fund represents the College’s share of the net liability in respect of the Local Government Pension Scheme. This fund has been separated on the College’s balance sheet in order to distinguish the liability from the operational liabilities which form part of the College’s working capital.

17 Restricted funds

The income funds of the College include restricted funds comprising the following balances of donations and grants held on trust to be applied for specific purposes.

Covid-19 funding Other restricted DfE/ESFA funding	At 1 August 2021 £’000 — — —	Income £’000 114 45 159	Expenditure £’000	At 31 July 2022 £’000 — — —
			(114) (45)
			(159)

The specific purposes for which the monies are held are as follows:

♦ Covid-19 funding

This comprises monies received from government to provide additional financial support to the College with managing the disruption caused by Covid-19

♦ Other restricted DfE/ESFA funding

This comprises monies received from government, the use of which is limited to very specific purposes in line with the grant conditions.

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Notes to the financial statements 31 July 2022

18 Analysis of net liabilities between funds

Unrestricted funds	Unrestricted funds	Unrestricted funds	Restricted funds £’000
General funds £’000	Tangible fixed assets fund £’000	Pensions reserve fund £’000
— 1,216 7,185 (2,655) — —	4,897 — — (20) (1,265) —	— — — — — (8,149)	— — — — — —
5,746	3,612	(8,149)	—

19 Pension and similar obligations

The College’s employees belong to two principal pension schemes: the Teachers’ Pension Scheme England and Wales (TPS) for academic and related staff: and the Local Government Pension Scheme (LGPS) for non-teaching staff, which is managed by London Borough of Sutton Pension Fund. Both are multi-employer defined benefit schemes.

The latest actuarial valuation of the TPS and of the LGPS related to the period 31 March 2019.

Contributions amounting to £134,707 (2021: £139,116) were payable to the schemes at 31 July 2022 and are included within creditors.

Teachers’ Pension Scheme

The Teachers' Pension Scheme (TPS) is a statutory, contributory, defined benefit scheme, governed by the Teachers’ Pension Scheme Regulations 2014. These regulations apply to teachers in schools, colleges and other educational establishments. Membership is automatic for teachers and lecturers at eligible institutions. Teachers and lecturers have the option to opt out of the TPS following enrolment.

The TPS is an unfunded scheme and members contribute on a ’pay as you go‘ basis – these contributions, along with those made by employers, are credited to the Exchequer under arrangements governed by the above Act. Retirement and other pension benefits are paid by public funds provided by Parliament.

Valuation of the Teachers’ Pension Scheme

The Government Actuary, using normal actuarial principles, conducts a formal actuarial review of the TPS in accordance with the Public Service Pensions (Valuations and Employer Cost Cap) Directions 2014 published by HM Treasury every 4 years. The aim of the review is to specify the level of future contributions. Actuarial scheme valuations are dependent on assumptions about the value of future costs, design of benefits and many other factors. The latest actuarial valuation of the TPS was carried out as of 31 March 2019. The valuation report was published by the Department for Education on 5 March 2019. The key elements of the valuation and subsequent consultation are:

♦ employer contribution rates set at 23.68% of pensionable pay (including a 0.08% administration levy);

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Notes to the financial statements 31 July 2022

19 Pension and similar obligations (continued)

Valuation of the Teachers’ Pension Scheme (continued)

♦ total scheme liabilities (pensions currently in payment and the estimated cost of future benefits) for service to the effective date of £218,100 million and notional assets (estimated future contributions together with the notional investments held at the valuation date) of £196,100 million, giving a notional past service deficit of £22,000 million;
♦ the SCAPE rate, set by HMT, is used to determine the notional investment return. The current SCAPE rate is 2.4% above the rate of CPI. assumed real rate of return is 2.4% in excess of prices and 2% in excess of earnings. The rate of real earnings growth is assumed to be 2.2%. The assumed nominal rate of return including earnings growth is 4.45%.

The next valuation result is due to be implemented from 1 April 2024.

The employer’s pension costs paid to TPS during the year amounted £438,000 (2021: £470,000).

A full copy of the valuation report and supporting documentation can be found on the Teachers’ Pension Scheme website.

Under the definitions set out in FRS 102, the TPS is a multi-employer pension scheme. The College has accounted for its contributions to the scheme as if it were a defined contribution scheme. The College has set out above the information available on the scheme.

Local Government Pension Scheme (LGPS)

The LGPS is a funded defined-benefit scheme, with the assets held in separate trustee-administered funds. The total contribution made for the year ended 31 July 2022 was £1,216,000 (2021: £1,113,000), of which employer’s contributions totalled £947,000 (2021: £870,000) and employees’ contributions totalled £269,000 (2021: £243,000)

totalled £269,000 (2021: £243,000)
Principal actuarial assumptions Rate of increase in salaries Rate of increase for pensions in payment Discount rate for scheme liabilities Inflation assumption(CPI)	At 31 July 2022 % 3.70 2.70 3.50 2.70	At 31 July 2021 %
		3.75 2.75 1.60 2.75

The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations from retirement age 65 are:

Retiring today Males Females Retiring in 20 years Males Females	At 31 July 2022 Years 21.4 24.1 22.9 25.8	At 31 July 2021 Years
		21.6 24.3 22.9 25.7

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Notes to the financial statements 31 July 2022

19 Pension and similar obligations (continued)

Local Government Pension Scheme (LGPS) (continued)

The College’s share of the assets in the scheme were: Equities Bonds Property Cash Total market value of assets	Fair value at 31 July 2022 £’000 3,838 1,599 704 256 6,397	Fair value at 31 July 2021 £’000 3,619 1,301 566 170 5,656

The actual return on scheme assets was £495,000 (2021: £529,000). During the year the College had a change of actuary from Barnett Waddingham to Hymans.

Amounts recognised in statement of financial activities Current service costs Net interest cost Net liability transferred to Orchard Hill College Academy Trust (note 5) Changes in thepresent value of defined benefit obligations were as follows: Opening balance Current service cost Interest cost Employee contributions Actuarial (gain) / loss Benefits paid Liability transferred to Orchard Hill College Academy Trust (note 5) At 31 July 2022	31 July 2022 £’000 2,835 244 — 3,079 31 July 2022 £’000 19,971 2,835 343 269 (8,793) (79) — 14,546	31 July 2021 £’000 1,071 149 (456) 764 31 July 2021 £’000 15,083 1,941 197 243 3,545 (27) (1,011) 19,971

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Notes to the financial statements 31 July 2022

19 Pension and similar obligations (continued)

Local Government Pension Scheme (LGPS) (continued)

Changes in the fair value of the College’s share of scheme assets: Opening balance Interest income Actuarial (loss) / gain Employer contributions Employee contributions Benefits paid Administration expenses Assets transferred to Orchard Hill College Academy Trust (note 5) At 31 July 2022	31 July 2022 £’000 5,656 99 (495) 947 269 (79) — — 6,397	31 July 2021 £’000 4,548 55 529 870 243 (27) (7) (555) 5,656

20 Related party transactions

Owing to the nature of the College’s operations and the composition of the Governing Body being drawn from local public and private sector organisations. It is inevitable that transactions will take place with organisations in which a Governor may have an interest. All transactions involving such organisations are conducted at arm’s length and in accordance with the College’s financial regulations and normal procurement procedures.

Related party income

The College has formalised a service level agreement with OHCAT and its academies for the provision of learning support services which, for the year ended 31 July 2022, amounted to £78,155 (2021: £297,000). The total value of services to individual academies and the central MAT during the year was as follows:

	2022 £ 56,037 1,950 250 — 3,353 4,576 411 — 2,965 7,601 — — 675 — 337 — 78,155	2021 £ 169,144 2,674 1,442 117 51,045 583 4,936 19,471 2,435 9,871 600 895 9,502 17,197 6,516 525 296,953
Orchard Hill College Academy Trust Carew Academy Young People’s Academy The Skills Hub Bedelsford School Dysart School St Philip’s School Nightingale Community Academy The Link Primary School The Link Secondary School Brantridge Grafham Grange St Dominic’s Arbour Vale School Unified Academy Addington Valley Academy

Orchard Hill College 43

Notes to the financial statements 31 July 2022

20 Related party transactions (continued)

Related party expenditure

The College has a Service Level Agreement with Orchard Hill College Academy Trust for the provision of business support services, including leadership, IT, MIS, Marketing, HR & Payroll and Finance.

The following services were provided at-cost basis during the period:

Leadership PA support Finance HR Governance Marketing IT MIS Facilities Safeguarding Training Occupational Health Legal Core service contribution	At 31 July 2022 £ — 31,814 289,307 150,752 10,411 62,443 179,596 9,658 277,195 15,721 19146 15,259 1,800 1,204,458 2,267,560	At 31 July 2021 £ 10,384 50,021 232,708 140,411 22,305 48,426 220,586 111,741 280,220 — — — — 1,074,935 2,191,737

In addition to the above, the following transactions took place between the College and individual academies within the Academy Trust:

♦ A College centre is based at one of the academies of Orchard Hill College Academy Trust; the College pays rent of £39,975 (2021: £39,975);
♦ During 2021-22, College students accessed a vocational provision delivered by one of the academies; the cost of these courses amounted to £58,000 (2021:90,000).
♦ The College has a service level agreement to reimburse the Academy Trust for costs incurred in relation to Garratt House, a College site transferred from the Academy Trust on a 50-year lease. In the year to 31 July 2022, the College paid £11,388 (2021: £11,032);
♦ All of these transactions were provided by Orchard Hill College Academy Trust at cost.

The amount due from the Academy Trust to the College at 31 July 2022 was £297,000 as disclosed in note 12 (2021: £269,000).

The amount due to the Academy Trust from the College at 31 July 2022 was £626,000 as disclosed in note 13 (2021: £nil),the majority of which relates to a VAT payment from the VAT group, which relates to OHCAT.

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Notes to the financial statements 31 July 2022

21 Operating lease commitments

At 31 July 2022, the total of the College’s future minimum lease payments under non-cancellable operating leases was as follows:

Amounts due within one year Amounts due within one to two years Amounts due after more than five years	At 31 July 2022 £’000 503 412 412 1,327	At 31 July 2021 £’000 487 404 408 1,299

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Notes to the financial statements 31 July 2022

22 Comparative information

Analysis of income and expenditure account for the year ended 31 July 2021 between restricted and unrestricted funds:

Income and expenditure account	Unrestricted funds £’000	Restricted funds £’000	31 July 2021 Total funds £’000	31 July 2020 Total funds £’000
Income from: Donations and legacies Charitable activities . Provision of education Other trading activities Investments Other items: pension liability transferred Total income Expenditure on: Charitable activities . Provision of education Total expenditure Net income before transfers Transfer between funds Net income Other recognised gains and losses Actuarial losses on defined benefit pension scheme Net movement in funds Reconciliation of funds Fund balances brought forward at 1 August 2020 Fund balances carried forward at 31 July2021	1,026 16,156 80 1 456	— 183 — — —	1,026 16,339 80 1 456	452 14,399 3 6 0
	17,719	183	17,902	14,860
	16,831	145	16,976	13,772
	16,831	145	16,976	13,772
	888 38	38 (38)	926 —	1,088 —
	926 (3,016)	— —	926 (3,016)	1,088 (4,694)
	(2,090) (3,022)	— —	(2,090) (3,022)	(3,606) 584
	(5,112)	—	(5,112)	(3,022)

Orchard Hill College 46

Orchard Hill College

Contents

Trustees’ report (including Strategic Report) 31 July 2022

OBJECTIVES AND ACTIVITIES

Public benefit

ACHIEVEMENTS AND PERFORMANCE

Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

Trustees’ report (including Strategic Report) 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

FINANCIAL REVIEW

Results for the year

Trustees’ report (including Strategic Report) 31 July 2022

FINANCIAL REVIEW (continued)

Results for the year (continued)

Financial position and reserves policy

Trustees’ report (including Strategic Report) 31 July 2022

FINANCIAL REVIEW (continued)

Financial position and reserves policy (continued)

Fundraising

STRUCTURE, GOVERNANCE AND MANAGEMENT

Constitution

Trustees’ report (including Strategic Report) 31 July 2022

STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Constitution (continued)

Organisational structure

Trustees’ report (including Strategic Report) 31 July 2022

STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Organisational structure (continued)

Connected organisations

Trustees

Trustees’ report (including Strategic Report) 31 July 2022

STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Trustees (continued)

Key management personnel

Trustees’ report (including Strategic Report) 31 July 2022

STRUCTURE, GOVERNANCE AND MANAGEMENT (continued)

Key Management Personnel (continued)

Statement of Trustees’ responsibilities

Trustees’ report (including Strategic Report) 31 July 2022

Statement of Trustees’ responsibilities (continued)

FUTURE PLANS

Orchard Hill College and the OHC&AT family of providers

Trustees’ report (including Strategic Report) 31 July 2022

FUTURE PLANS (continued)

Orchard Hill College and the OHC&AT family of providers (continued)

PRINCIPAL RISKS AND UNCERTAINTIES

PRINCIPAL RISKS AND UNCERTAINTIES (continued)

Quality

Compliance

Recruitment

PRINCIPAL RISKS AND UNCERTAINTIES (continued)

Recruitment (continued)

Infrastructure and capacity

Over-expansion

Business continuity

Trustees’ report (including Strategic Report) 31 July 2022

PRINCIPAL RISKS AND UNCERTAINTIES (continued)

Funding

Risk Management

Date: Independent auditor’s report to the members of Orchard Hill College

Opinion

Basis for opinion

Conclusions relating to going concern

Other information

Trustees’ report (including Strategic Report) 31 July 2022

Other information (continued)

Opinions on other matters prescribed by the Companies Act 2006

Matters on which we are required to report by exception

Responsibilities of Trustees

Auditor’s responsibilities for the audit of the financial statements

Trustees’ report (including Strategic Report) 31 July 2022

Auditor’s responsibilities for the audit of the financial statements (continued)

Use of our report

Statement of financial activities Year to 31 July 2022

Balance Sheet 31 July 2022

Statement of cash flows 31 July 2022