2022-04-01-accounts - Coutts Charitable Foundation

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Charity Registration Number: 1150784 Company Registration Number: 08395296

COUTTS CHARITABLE FOUNDATION

(A company limited by guarantee)

REPORT AND FINANCIAL STATEMENTS

For the year ended 1 April 2022

COUTTS CHARITABLE FOUNDATION

OUTTS CHARITABLE FOUNDATION
CONTENTS	Page
Legal and administrative details	1
Trustees' report	3
Statement of trustees’ responsibilities	7
Independent auditor’s report	8
Statement of financial activities	11
Balance sheet	12
Notes to the financial statements	13

COUTTS CHARITABLE FOUNDATION

LEGAL AND ADMINISTRATIVE DETAILS

TRUSTEES

The Rt Hon Lord Waldegrave of North Hill (Chair)

Francesca Barnes (resigned 16 June 2022)

Peter Flavel Rachel Harrington Laura Lines

Dr Judith McNeill

Alison Rose

Camilla Stowell

Linda Urquhart (appointed 16 June 2022)

Dr Linda Yueh

DIRECTOR

Clare Richards MBE (appointed 31 January 2022)

COMPANY SECRETARY

Mark Elliott

CORRESPONDENT AND ADMINISTRATOR

Tamara Lee

ADVISOR

Thom Kenrick

CONSULTANTS

Rachel Billett

Sue Cook

REGISTERED OFFICE

440 Strand London WC2R 0QS

COUTTS CHARITABLE FOUNDATION

LEGAL AND ADMINISTRATIVE DETAILS

AUDITOR

Buzzacott 130 Wood Street London EC2V 6DL

BANKER

Coutts & Company 440 Strand London WC2R 0QS

INVESTMENT MANAGER

Coutts & Company 440 Strand London WC2R 0QS

CHARITY REGISTRATION NUMBER

1150784

COMPANY REGISTRATION NUMBER

08395296

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

The Trustees present their report and audited financial statements for the Coutts Charitable Foundation (known as The Coutts Foundation) (“the Charity”) for the period 2 April 202 1 to 1 April 2022.

The Charity was set up to effect Coutts & Company’s (“Coutts”) commitm ent to the community.

The mission of the Coutts Foundation is to support sustainable solutions to tackle the causes and consequences of poverty, focusing on the communities where Coutts has a presence. During the reporting period, the Charity had a particular focus on supporting organisations that benefit women and girls facing disadvantage; young people; empowering young people through the performing arts and homelessness in Westminster.

As a grant-making foundation, the Trustees distribute funds to a limited number of charitable organisations based in the UK that reflect the Charity’s mission and focus. Details of organisations supported by the Charity can be found at www.coutts.com/foundation. The Charity achieves its mission and objectives by pro-actively identifying appropriate organisations to support and tracking their progress through receipt of written narrative and financial reports and through site visits.

OBJECTIVES OF THE CHARITY

The objective of the Charity is to assist charitable bodies which undertake activities for the public benefit. The Trustees confirm that in carrying out the objectives of the Charity due regard has been paid to the public benefit guidance published by the Charity Commission.

ORGANISATIONAL STRUCTURE, GOVERNANCE AND DECISION-MAKING

The Charity is a charitable company limited by guarantee, incorporated on 8 February 2013 and registered as a charity on 12 February 2013. The Charity was established under a Memorandum of Association which established the objects and powers of the Charity and is governed under its Articles of Association. In the event of the Charity being wound up members are required to contribute an amount not exceeding £1.

The Charity is governed by a Board of Directors who are Trustees for the purposes of charity law. The founding Trustees of the Charity were Senior Executives of Coutts, with subsequent Trustees being appointed by the Board. Coutts may, by written notice to the Trustees, appoint up to 60% of the total number of Trustees from time to time. Trustees serve terms of three years and are eligible for re-election at the end of the term. All new Trustees undertake an induction programme and receive a structured introduction to the operation of the Charity. The Trustees are mindful that due to recent appointments and resignations, 70% of the current Trustees are connected to Coutts, and are currently redressing this balance through a new round of Trustee recruitment.

The relationship between Coutts and the Charity is set out in an agreed Corporate Relationship Agreement, which references financial and other support given to the Charity by Coutts. The Corporate Relationship Agreement was prepared during the financial year but was signed in April 2022 after year end.

There was one employee seconded to the Foundation in respect of the current period. A Foundation – Director was employed 31 January 2022 the Charity’s first dedicated member of staff. Coutts provides direct and indirect pro-bono services/expertise to the Charity in a number of areas, including office space and IT services, staff support from a part-time Administrator and volunteer support from the Company Secretary and other staff members. During the reporting period, the value of this staff time and direct services relating to investment management and payments was calculated at £51,201 (2021: £50,197).

Trustee meetings are held a minimum of three times a year to review and agree areas of grant-making, governance, policy, strategy, performance of investments and risk management. In addition, the Charity has an Audit, Finance and Investment Committee and a Governance and Nominations Committee, which have delegated authority by the Trustees. Members of Committees are all Trustees of the Charity.

The Trustees take all decisions on which charities the Charity will support. The Charity adopts a proactive approach to identifying organisations to support that reflect its mission and focus. A detailed duediligence process is undertaken before Trustees approve any funding, which includes making a site visit to organisations that are considered for funding.

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

RISK MANAGEMENT

The Trustees have identified five main areas of risks:

Governance – looks at board skills, composition, attendance, succession planning, management of conflicts of interest/loyalty and management of the relationship with the primary funder, Coutts & Co.

– Funding and management of reserves looks at the income of the Charity and the management of the Charity’s reserves.

– Strategy and the work of charities supported looks at progress of organisations supported by the Charity and potential risks, and at the strategy of the Charity.

– Human resourcing looks at the day-to-day mana gement of the Charity’s work.

Communications – looks at reputational risks and media.

Having assessed the major risks the Trustees believe that by ensuring adequate controls and processes exist, they mitigate those risks. Towards the end of the reporting period the Trustees were mindful of the forecasted cost of living rises for the grantees and their clients. The relevant risks and means of mitigation form part of the risk register.

The detailed risk register, which includes means of mitigation, is reviewed quarterly by the Board.

REVIEW OF ACTIVITIES AND FUTURE DEVELOPMENTS

As at 1 April 2022, the Charity had committed to making donations amounting to £928,840 (2021: £942,679). Payments of £810,679 (2021: £746,590) were made to charitable organisations. Support costs of £133,464 (2021: £91,962) include fees for consultants to assist with due diligence on potential grantees.

The Charity maintains on-going communication with all organisations supported. To understand the impact of the organisations supported (and therefore of the Coutts Foundation’s grant -making) all charities supported provide the Charity with reports every six months on progress. Trustees also look to meet with the supported charities; during the Covid-19 pandemic these meetings took place on Zoom.

Supporting women and girls

In 2021 the Trustees commissioned long-term consultant Rachel Billet to undertake a review of the Foundation’s funding for the women and girls’ sector to date. The review process included focus groups which enabled Trustees to hear directly from grantees – and grantees to connect with one another – as well as desk reviews of the reporting on grants made to date. The report found that the Foundation’s grantees provided long-term support to over 38,000 women over the six years to August 2020. Feedback from grantees highlighted that one of the most significant areas of impact from the funding has been the impact of unrestricted, long-term funding on the organisations themselves.

It has enabled them to:

Employ sufficient core management and support staff, providing the capacity to plan and deliver behind the scenes tasks such as implementing GDPR measures, new risk assessments, organisational reviews, office moves and website redesigns. In one case, it meant the difference between a part-time and full-time Chief Executive.
Support a leadership role and voice for the organisations and their beneficiaries – sharing expertise and influence nationally and developing external communications and fundraising
• Be more flexible, outward and forward focused.
Fund activities that are difficult to fund from other sources, such as support for women with no recourse to public funds.
Maintain quality approaches, and support the training, skills development and wellbeing of staff and Trustees
• “Test out” new approaches

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

REVIEW OF ACTIVITIES AND FUTURE DEVELOPMENTS (continued)

Supporting women and girls (continued)

The Trustees are drawing on the findings of the report to review and refresh the Foundation’s women and girls strategy during the rest of 2022.

Young people and the performing arts

During the reporting period the Trustees were also able to revisit the additional grant-making strand that they had begun to explore in 2019-2020, focusing on the role of the performing arts in tackling the causes and consequences of poverty. With support from arts consultant, Sue Cook, the Trustees continue focus on organisations which harness the performing arts to engage and empower young people who are disadvantaged and marginalised.

Following in-depth research, a number of organisations were identified for further due diligence, and Trustees were delighted to approve 3 further grants under this theme.

Homelessness in Westminster

With more people sleeping rough in Westminster, than anywhere else in the UK, the Trustees continue to support The Conn ection at St Martin’s, London’s busiest homelessness charity and a neighbour of Coutts at 440 Strand.

Investment performance

The investment portfolio is managed by an asset manager appointed by the Trustees. Trustees and the Audit, Finance and Investment Committee review performance against the objectives set in the Investment Policy and are satisfied that the performance in 2021 and 2022 met their expectations.

The value of the investment portfolio recovered during the period. The Charity’s investment s trategy aims to grow the real value of investments over long term, and to deliver a cash flow to help meet charitable grants and donations.

Future plans

The Charity intends to operate within existing objectives, policies and governance structure for the forthcoming year. The Charity will continue to further its mission through its support of existing grantees and the exploration of possible new opportunities. The Charity will continue to focus on developing its grants portfolio focusing on the communities where Coutts has a presence. The total annual volume of donations may vary depending on the number of organisations identified to support and the value of grant commitments and annual payments made to each organisation.

Subsequent events

During the reporting period, the Trustees continued to liaise with the Charity’s funder, Coutts & Co, on the longer-term funding arrangement. The new agreement is due to be in place by the end of 2022 with the funding mechanism to begin in early 2023.

FINANCIAL REVIEW

The Trustees are satisfied with the Charity’s performance during the year. The Charity’s income consisted of donations received and investment income.

Total income during the period was £561,251 (2021: £316,281). After donations to beneficiaries of £796,840 (2021: £784,743), support costs of £133,464 (2021: £91,962) and net gain on investments of £169,661 (2021: net gain of £1,000,612), there was a net decrease in funds of £199,392 (2021: net increase of £440,188).

The decrease of the Char ity’s funds by £199,392 (2021: net increase of £440,188) was driven primarily by loss in investments.

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

FINANCIAL REVIEW (continued)

During the period, the Trustees continued to follow its Reserves Policy, which covers three years of commitments but does not build an endowment. The Trustees wish to ensure that the Foundation could fulfil its grant-making commitments and other expenditure to spend down in an orderly manner, if required. Given that the Foundation generally makes three-year grant commitments, a time horizon for reserves of at least three years’ expenditure is necessary. At the Charity’s current level of grant -making, this requires reserves of at least £3m

The Trustees therefore continued to draw down from the investment portfolio to make funds available for grant-making, retaining at least £3m to provide appropriate reserves. Coutts & Co confirmed their continued support of the Charity and it is expected that annual expenditure of up to £1m will in future be covered by regular donations from Coutts & Co.

The Trustees will maintain sufficient liquidity and cash reserves outside of any investment portfolio at all times to meet near-term expenditure (of at least one year). Trustees are mindful th at all the Charity’s funds are in fact unrestricted and that, in the case of urgent need, further liquid assets can be generated.

SMALL COMPANIES EXEMPTION

The Trustees have taken the small companies exemption contained in s414B of the Companies Act 2006 from the requirements to prepare a strategic report.

Approved by the Trustees and signed on their behalf by:

Dr Linda Yueh Trustee and Chair of Audit, Finance and Investment Committee 21 November 2022

The Rt Hon Lord Waldegrave of North Hill Chair of Trustees 21 November 2022

COUTTS CHARITABLE FOUNDATION

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

The Trustees (who are also directors of the Charity for the purposes of company law) are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and to the Financial Reporting Standard 102 (“FRS 102”).

Company law requires the Trustees to prepare financial statements for each financial period. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Charity, and of the incoming resources and application of resources, including the income and expenditure of the Charity 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 the Charities SORP;
make judgements and estimates that are reasonable and prudent;
state whether applicable UK accounting standards have been followed including FRS 102, 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 not appropriate to assume that the Charity will continue in business.

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the Charity’s transactions and disclose with reasonable accuracy at any time the fin ancial position of the Charity and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the Trustees are aware:

there is no relevant audit information of which the Charity’s auditor is unaware, and
the Trustees have taken all the steps that they ought to have taken in order to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

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

Approved by the Trustees and signed on their behalf by:

Dr Linda Yueh The Rt Hon Lord Waldegrave of North Hill Trustee and Chair of Audit, Finance and Investment Chair of Trustees Committee 21 November 2022 21 November 2022

Independent auditor’s report to the trustees of Coutts Charitable Foundation

Opinion

We have audited the financial statements of Coutts Charitable Foundation (the ‘charitable company’) for the year ended 1 April 2022 which comprise the statement of financial activities, the balance sheet, 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 Reportin g 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 charitable company’s affairs as at 1 April 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 stan dards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the fi nancial 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 charitable company’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, 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.

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.

Independent auditor’s report to the trustees of Coutts Charitable Foundation

Opinion 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 charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of trustees’ 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

As explained mor e fully in the trustees’ responsibilities statement, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the 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:

We obtained an understanding of the legal and regulatory frameworks applicable to the charity. We determined that the following laws and regulations were most significant: The Statement of Recommended Practice (SORP (“FRS 102”)).
We understood how the Charity is complying with these legal and regulatory Frameworks by making enquiries of management and those responsible for legal and compliance procedures. Through our enquiries we corroborated these views by our review of minutes of the trust.

Independent auditor’s report to the trustees of Coutts Charitable Foundation

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

We assessed the susceptibility of the Financial statements to material misstatement, including how fraud might occur Audit procedures performed by the audit team included:
Enquiries with the Trustees, whether they have any knowledge of any actual, suspected or alleged fraud;
Challenging assumptions and judgements made by Trustees in their significant accounting estimates.
Assessing the extent of compliance with the relevant laws and regulations as part of our procedures.

We have assessed the design and effectiveness of controls to prevent and detect fraud. This includes considering the incentives and opportunities management may have for fraud. We have also performed audit procedures to identify management override of controls. We have reviewed assumptions and judgements and considered any accounting estimates and reviewed compliance with laws and regulations.

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 charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company'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 charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Edward Finch (Senior Statutory Auditor) For and on behalf of Buzzacott LLP, Statutory Auditor 130 Wood Street London EC2V 6DL

Date[9 December 2022]

COUTTS CHARITABLE FOUNDATION

STATEMENT OF FINANCIAL ACTIVITIES

(including the income and expenditure account) for the year ended 1 April 2022

Notes	Unrestricted Funds Unrestricted Funds 2022 2021 £ £ 501,201 250,197 60,050 66,084 561,251 316,281 (796,840) (784,743) (133,464) (91,962) (930,304) (876,705) 160,125 311,951 9,536 688,661 169,661 1,000,612 (199,392) 440,188 3,997,178 3,556,990 3,797,786 3,997,178
Income Income from generated funds: Donations received 3 Investment income 4
Total income Expenditure Charitable activities: Grant expenditure 5 Support costs
Total expenditure Realised gain on disposal of investments Unrealised gainon revaluationof investments 7
Net gain on investments Net (expenditure)/income for the year and net movement in funds Reconciliation of funds Funds brought forward
Total funds carried forward

The Statement of Financial Activities includes all gains and losses in the year. All funds are unrestricted. All income and expenditure derive from continuing activities.

The accompanying notes form an integral part of these financial statements.

COUTTS CHARITABLE FOUNDATION

BALANCE SHEET as at 1 April 2022

Notes	2022 2021 £ £ 3,475,495 3,732,661 1,276,925 1,234,397 4,752,420 4,967,058 (566,840) (615,680) (25,795) (27,200) (592,635) (642,880) 684,291 591,517 (362,000) (327,000) (954,635) (969,880) 3,797,786 3,997,178 3,797,786 3,997,178
Non-current assets Investments 7 Current assets Cash at bank
Total assets Current liabilities Grants payable 9 Accruals
Net current assets Non-current liabilities Grantspayable 9
Total liabilities
Net assets
Unrestricted funds

The accompanying notes form an integral part of these financial statements.

These financial statements were approved by the Trustees and signed on their behalf by:

Dr Linda Yueh

Trustee and Chair of Audit, Finance and Investment Committee 21 November 2022

Rt Hon Lord Waldegrave of North Hill Chair of Trustees 21 November 2022

Company registration number 08395296

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies

a) Basis of accounting

The Charity is a public benefit entity and these financial statements are prepared:

in accordance with the Statement of Recommended Practice (SORP): Accounting and Reporting by Charities applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) issued on 16 July 2014, the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102), the Charities Act 2011 and the Companies Act 2006;
presented with the benefit of the disclosure exemption permitted by FRS 102, Section 1A;
on the historical cost convention, with the exception of investments which have been included at market value; and
on a going concern basis. The trustees have assessed whether the use of the going concern assumption is appropriate in preparing these accounts. The trustees have made this assessment in respect to a period of one year from the date of approval of these accounts.

Having considered the impact of the coronavirus pandemic and other significant factors, the trustees of the charity have concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the charity to continue as a going concern. The trustees are of the opinion that the charity will have sufficient resources to meet its liabilities as they fall due and therefore conclude that the charity is a going concern.

b) Fund accounting

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objectives of the Charity.

c) Income

All income is recognised in the Statement of Financial Activities when the Charity is entitled to, and virtually certain to receive the income and the amount can be quantified with reasonable accuracy. The following policies are applied to particular categories of income:

Voluntary income is received by way of grants, donations and gifts and is included in full in the Statement of Financial Activities when receivable.
Investment income is included when receivable. Tax recoverable relating to interest income is accounted for in the same period as the related income.

d) Expenditure

Expenditure is recognised on an accrual basis as a liability is incurred. Expenditure includes any VAT which cannot be fully recovered, and is reported as part of the expenditure to which it relates:

Charitable expenditure comprises those costs incurred by the Charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and those costs of an indirect nature necessary to support them. Grants payable are recognised when a constructive obligation arises that result in payment being unavoidable, generally when the grant letter has been issued to the beneficiary.
Governance costs include those costs associated with meeting the constitutional and statutory requirements of the Charity. The remuneration of the auditor in the current financial period of £6,912 has been borne by The Coutts Foundation.

e) Cash flow statement

The Charity has taken the exemption from producing a cash flow statement conferred by Financial Reporting Standard 102 as it qualifies as a small charity.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies (continued)

f) Taxation The Charity is a registered charity and as such is not subject to tax on its income or gains falling within chapter 3 of part II of the Corporation Tax Act 2010 or s256 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects. No tax charges have arisen in the Charity.

g) Investments

Investments are classified as fair value through profit or loss and are measured initially and subsequently at fair value by reference to quoted market prices or other observable data. Transaction costs are expensed immediately and gains and losses are taken to the Statement of Financial Activities.

h) Foreign currencies

Transactions in foreign currencies are translated into sterling at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Any gain or loss arising on translation is included in the Statement of Financial Activities.

2. Critical accounting policies and key sources of estimation uncertainty

The preparation of the Charity’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. These assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in the current and future periods, depending on circumstance.

The Trustees do not believe that any accounting judgements or estimates have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.

3. Donations received

3. Donations received
	2022	2021
	£	£
Donations:
Coutts & Company	501,201	250,197
	501,201	250,197

The Trustees carried out a review of the Charity’s funding and reserves policy.

During the reporting period, the value of this staff time and direct services relating to investment management and payments was calculated at £51,201 (2021: £50,197).

4. Investment income

4. Investment income
	2022	2021
	£	£
Income from investments	59,645	65,737
Interest on bank deposits:
UK	405	362
Non UK	-	(15)
	60,050	66,084

Investment incomes are derived from holdings which are listed on UK stock exchange or incorporated in the UK.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

5. Grant expenditure

5. Grant expenditure
	2022	2021
	£	£
Grants committed to by the Charity in the year :
Anawim	30,000	(45)
Immediate Theatre	35,000	105,000
Women Resource Centre	-	250
Women Centre Ltd	50,000	-
Angelou Centre 2	-	120,000
Bawso 2	-	150,000
Contact	-	150,000
Magdalene Group	-	120,000
Emergency Covid-19 - Bawso 2	-	15,600
Emergency Covid-19 - Magdalene Group	-	8,217
Emergency Covid-19 - The Nelson Trust	-	10,000
Emergency Covid-19 - Southall Black Sisters Trust	-	15,000
Emergency Covid-19 - Stockport Womens Centre 2	-	16,721
Emergency Covid-19 -The Connection at St Martin’s 2	-	5,000
Emergency Covid-19 - The Theatre Artists Fund	-	20,000
Emergency Covid-19 - Winner, The Preston Road Women's Centre	-	15,000
Emergency Covid-19 - Women Centre Ltd	-	10,000
Clore Social Leadership Programme	-	24,000
The Connection at St Martin's (SET)	41,840	-
Winner, The Preston Road Women's Centre	150,000	-
20 Stories High	105,000	-
Nelson Trust 2	50,000	-
Southall Black Sisters	40,000	-
Travelling Light	105,000	-
Trinity	150,000	-
EndViolence againstwomen	40,000	-
	796,840	784,743

The above comprises of the total value of charitable donations which have been committed to during the period by the Charity.

6. Trustees remuneration and expenses

There are no employees and the Trustees received neither remuneration nor expenses in the current year or prior period.

7. Investments

	2022 2021 £ £ 3,732,660 3,181,068 1,601,620 3,562,168 (1,868,321) (3,699,237) 9,536 688,661 3,475,495 3,732,660 3,246,437 4,192,264
Listed investments - UK (Classification is based on the country of incorporation or listing) Opening market value Additions at cost Disposals at opening book value Net unrealisedgain/(loss)
Closing market value
Cost at 1 April

Investments are valued by reference to observable data or other quoted market prices. The investment allocation follows SORP disclosure guidance.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

8. Grants payable

	Due within one year Due after more than one year 2022 2021 2022 2021 £ £ £ £ 40,000 40,000 80,000 40,000 40,000 30,000 - - 41,840 83,679 - - 60,000 60,000 - 60,000 50,000 50,000 100,000 - 40,000 80,000 - 40,000 50,000 50,000 50,000 50,000 - 12,000 12,000 12,000 50,000 100,000 - 50,000 35,000 70,000 - 35,000 40,000 40,000 - 40,000 35,000 - 35,000 - 50,000 - 50,000 - 35,000 - 35,000 - 566,840 615,679 362,000 327,000
Stockport Women's Centre 2 Tender Education & Arts The Connection at St Martin's (SET) The Connection at St Martin’s 2 Winner, The Preston Road Women's Centre Angelou Centre 2 Bawso 2 Clore Social Leadership Programme Contact Immediate Theatre Magdalene Group Travelling Light Trinity 20 Storieshigh

Due within one year
Due after more than one
year
2022
2021
2022
2021
£
£
£
£
40,000
40,000
80,000
40,000
40,000
30,000
-
-
41,840
83,679
-
-
60,000
60,000
-
60,000
50,000
50,000
100,000
-
40,000
80,000
-
40,000
50,000
50,000
50,000
50,000
-
12,000
12,000
12,000
50,000
100,000
-
50,000
35,000
70,000
-
35,000
40,000
40,000
-
40,000
35,000
-
35,000
-
50,000
-
50,000
-
35,000
-
35,000
-
566,840
615,679
362,000
327,000

Stockport Women's Centre 2
Tender Education & Arts
The Connection at St Martin's (SET)
The Connection at St Martin’s 2
Winner, The Preston Road Women's Centre
Angelou Centre 2
Bawso 2
Clore Social Leadership Programme
Contact
Immediate Theatre
Magdalene Group
Travelling Light
Trinity
20 Storieshigh

9. Commitments

9. Commitments
	2022 2021 £ £
Grant commitments recognised at the start of the year New grant commitments charged to the Statement of Financial Activities in the year Grants paid during year	942,679 904,526 796,840 784,743 (810,679) (746,590)
Within one year More thanone year	928,840 942,679
	566,840 615,679 362,000 327,000
	928,840 942,679

10. Related party transactions

Coutts is the primary funds provider of the Charity. Coutts may, by written notice to the Trustees, appoint up to 60% of the total number of Trustees from time to time.

Coutts provides direct and indirect pro-bono services/expertise to the Charity in a number of areas, including office space and IT services, staff support from a part-time Administrator and volunteer support from the Company Secretary and other staff members. During the reporting period, the value of this staff time and direct services relating to investment management and payments was calculated at £51,201 (2021: £50,197).

No Trustee or other person related to the Charity had any personal interest in any transaction entered into by the Charity during the period.

Charity Registration Number: 1150784 Company Registration Number: 08395296

COUTTS CHARITABLE FOUNDATION

(A company limited by guarantee)

REPORT AND FINANCIAL STATEMENTS

For the year ended 1 April 2022

COUTTS CHARITABLE FOUNDATION

OUTTS CHARITABLE FOUNDATION
CONTENTS	Page
Legal and administrative details	1
Trustees' report	3
Statement of trustees’ responsibilities	7
Independent auditor’s report	8
Statement of financial activities	11
Balance sheet	12
Notes to the financial statements	13

COUTTS CHARITABLE FOUNDATION

LEGAL AND ADMINISTRATIVE DETAILS

TRUSTEES

The Rt Hon Lord Waldegrave of North Hill (Chair)

Francesca Barnes (resigned 16 June 2022)

Peter Flavel Rachel Harrington Laura Lines

Dr Judith McNeill

Alison Rose

Camilla Stowell

Linda Urquhart (appointed 16 June 2022)

Dr Linda Yueh

DIRECTOR

Clare Richards MBE (appointed 31 January 2022)

COMPANY SECRETARY

Mark Elliott

CORRESPONDENT AND ADMINISTRATOR

Tamara Lee

ADVISOR

Thom Kenrick

CONSULTANTS

Rachel Billett

Sue Cook

REGISTERED OFFICE

440 Strand London WC2R 0QS

COUTTS CHARITABLE FOUNDATION

LEGAL AND ADMINISTRATIVE DETAILS

AUDITOR

Buzzacott 130 Wood Street London EC2V 6DL

BANKER

Coutts & Company 440 Strand London WC2R 0QS

INVESTMENT MANAGER

Coutts & Company 440 Strand London WC2R 0QS

CHARITY REGISTRATION NUMBER

1150784

COMPANY REGISTRATION NUMBER

08395296

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

The Charity was set up to effect Coutts & Company’s (“Coutts”) commitm ent to the community.

OBJECTIVES OF THE CHARITY

ORGANISATIONAL STRUCTURE, GOVERNANCE AND DECISION-MAKING

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

RISK MANAGEMENT

The Trustees have identified five main areas of risks:

– Funding and management of reserves looks at the income of the Charity and the management of the Charity’s reserves.

– Strategy and the work of charities supported looks at progress of organisations supported by the Charity and potential risks, and at the strategy of the Charity.

– Human resourcing looks at the day-to-day mana gement of the Charity’s work.

Communications – looks at reputational risks and media.

The detailed risk register, which includes means of mitigation, is reviewed quarterly by the Board.

REVIEW OF ACTIVITIES AND FUTURE DEVELOPMENTS

Supporting women and girls

It has enabled them to:

Employ sufficient core management and support staff, providing the capacity to plan and deliver behind the scenes tasks such as implementing GDPR measures, new risk assessments, organisational reviews, office moves and website redesigns. In one case, it meant the difference between a part-time and full-time Chief Executive.
Support a leadership role and voice for the organisations and their beneficiaries – sharing expertise and influence nationally and developing external communications and fundraising
• Be more flexible, outward and forward focused.
Fund activities that are difficult to fund from other sources, such as support for women with no recourse to public funds.
Maintain quality approaches, and support the training, skills development and wellbeing of staff and Trustees
• “Test out” new approaches

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

REVIEW OF ACTIVITIES AND FUTURE DEVELOPMENTS (continued)

Supporting women and girls (continued)

The Trustees are drawing on the findings of the report to review and refresh the Foundation’s women and girls strategy during the rest of 2022.

Young people and the performing arts

Following in-depth research, a number of organisations were identified for further due diligence, and Trustees were delighted to approve 3 further grants under this theme.

Homelessness in Westminster

Investment performance

Future plans

Subsequent events

FINANCIAL REVIEW

The Trustees are satisfied with the Charity’s performance during the year. The Charity’s income consisted of donations received and investment income.

The decrease of the Char ity’s funds by £199,392 (2021: net increase of £440,188) was driven primarily by loss in investments.

COUTTS CHARITABLE FOUNDATION

TRUSTEES’ REPORT

FINANCIAL REVIEW (continued)

SMALL COMPANIES EXEMPTION

The Trustees have taken the small companies exemption contained in s414B of the Companies Act 2006 from the requirements to prepare a strategic report.

Approved by the Trustees and signed on their behalf by:

Dr Linda Yueh Trustee and Chair of Audit, Finance and Investment Committee 21 November 2022

The Rt Hon Lord Waldegrave of North Hill Chair of Trustees 21 November 2022

COUTTS CHARITABLE FOUNDATION

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

select suitable accounting policies and then apply them consistently;
observe the methods and principles in the Charities SORP;
make judgements and estimates that are reasonable and prudent;
state whether applicable UK accounting standards have been followed including FRS 102, 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 not appropriate to assume that the Charity will continue in business.

In so far as the Trustees are aware:

there is no relevant audit information of which the Charity’s auditor is unaware, and
the Trustees have taken all the steps that they ought to have taken in order to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

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

Approved by the Trustees and signed on their behalf by:

Dr Linda Yueh The Rt Hon Lord Waldegrave of North Hill Trustee and Chair of Audit, Finance and Investment Chair of Trustees Committee 21 November 2022 21 November 2022

Independent auditor’s report to the trustees of Coutts Charitable Foundation

Opinion

In our opinion, the financial statements:

give a true and fair view of the state of the charitable company’s affairs as at 1 April 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

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.

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

Other information

We have nothing to report in this regard.

Independent auditor’s report to the trustees of Coutts Charitable Foundation

Opinion 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

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of trustees’ 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

Auditor’s responsibilities for the audit of the financial statements

We obtained an understanding of the legal and regulatory frameworks applicable to the charity. We determined that the following laws and regulations were most significant: The Statement of Recommended Practice (SORP (“FRS 102”)).
We understood how the Charity is complying with these legal and regulatory Frameworks by making enquiries of management and those responsible for legal and compliance procedures. Through our enquiries we corroborated these views by our review of minutes of the trust.

Independent auditor’s report to the trustees of Coutts Charitable Foundation

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

We assessed the susceptibility of the Financial statements to material misstatement, including how fraud might occur Audit procedures performed by the audit team included:
Enquiries with the Trustees, whether they have any knowledge of any actual, suspected or alleged fraud;
Challenging assumptions and judgements made by Trustees in their significant accounting estimates.
Assessing the extent of compliance with the relevant laws and regulations as part of our procedures.

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.

Use of our report

Edward Finch (Senior Statutory Auditor) For and on behalf of Buzzacott LLP, Statutory Auditor 130 Wood Street London EC2V 6DL

Date[9 December 2022]

COUTTS CHARITABLE FOUNDATION

STATEMENT OF FINANCIAL ACTIVITIES

(including the income and expenditure account) for the year ended 1 April 2022

Notes	Unrestricted Funds Unrestricted Funds 2022 2021 £ £ 501,201 250,197 60,050 66,084 561,251 316,281 (796,840) (784,743) (133,464) (91,962) (930,304) (876,705) 160,125 311,951 9,536 688,661 169,661 1,000,612 (199,392) 440,188 3,997,178 3,556,990 3,797,786 3,997,178
Income Income from generated funds: Donations received 3 Investment income 4
Total income Expenditure Charitable activities: Grant expenditure 5 Support costs
Total expenditure Realised gain on disposal of investments Unrealised gainon revaluationof investments 7
Net gain on investments Net (expenditure)/income for the year and net movement in funds Reconciliation of funds Funds brought forward
Total funds carried forward

The Statement of Financial Activities includes all gains and losses in the year. All funds are unrestricted. All income and expenditure derive from continuing activities.

The accompanying notes form an integral part of these financial statements.

COUTTS CHARITABLE FOUNDATION

BALANCE SHEET as at 1 April 2022

Notes	2022 2021 £ £ 3,475,495 3,732,661 1,276,925 1,234,397 4,752,420 4,967,058 (566,840) (615,680) (25,795) (27,200) (592,635) (642,880) 684,291 591,517 (362,000) (327,000) (954,635) (969,880) 3,797,786 3,997,178 3,797,786 3,997,178
Non-current assets Investments 7 Current assets Cash at bank
Total assets Current liabilities Grants payable 9 Accruals
Net current assets Non-current liabilities Grantspayable 9
Total liabilities
Net assets
Unrestricted funds

The accompanying notes form an integral part of these financial statements.

These financial statements were approved by the Trustees and signed on their behalf by:

Dr Linda Yueh

Trustee and Chair of Audit, Finance and Investment Committee 21 November 2022

Rt Hon Lord Waldegrave of North Hill Chair of Trustees 21 November 2022

Company registration number 08395296

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies

a) Basis of accounting

The Charity is a public benefit entity and these financial statements are prepared:

in accordance with the Statement of Recommended Practice (SORP): Accounting and Reporting by Charities applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) issued on 16 July 2014, the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102), the Charities Act 2011 and the Companies Act 2006;
presented with the benefit of the disclosure exemption permitted by FRS 102, Section 1A;
on the historical cost convention, with the exception of investments which have been included at market value; and
on a going concern basis. The trustees have assessed whether the use of the going concern assumption is appropriate in preparing these accounts. The trustees have made this assessment in respect to a period of one year from the date of approval of these accounts.

b) Fund accounting

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objectives of the Charity.

c) Income

Voluntary income is received by way of grants, donations and gifts and is included in full in the Statement of Financial Activities when receivable.
Investment income is included when receivable. Tax recoverable relating to interest income is accounted for in the same period as the related income.

d) Expenditure

Expenditure is recognised on an accrual basis as a liability is incurred. Expenditure includes any VAT which cannot be fully recovered, and is reported as part of the expenditure to which it relates:

Charitable expenditure comprises those costs incurred by the Charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and those costs of an indirect nature necessary to support them. Grants payable are recognised when a constructive obligation arises that result in payment being unavoidable, generally when the grant letter has been issued to the beneficiary.
Governance costs include those costs associated with meeting the constitutional and statutory requirements of the Charity. The remuneration of the auditor in the current financial period of £6,912 has been borne by The Coutts Foundation.

e) Cash flow statement

The Charity has taken the exemption from producing a cash flow statement conferred by Financial Reporting Standard 102 as it qualifies as a small charity.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies (continued)

g) Investments

h) Foreign currencies

2. Critical accounting policies and key sources of estimation uncertainty

3. Donations received

3. Donations received
	2022	2021
	£	£
Donations:
Coutts & Company	501,201	250,197
	501,201	250,197

The Trustees carried out a review of the Charity’s funding and reserves policy.

During the reporting period, the value of this staff time and direct services relating to investment management and payments was calculated at £51,201 (2021: £50,197).

4. Investment income

4. Investment income
	2022	2021
	£	£
Income from investments	59,645	65,737
Interest on bank deposits:
UK	405	362
Non UK	-	(15)
	60,050	66,084

Investment incomes are derived from holdings which are listed on UK stock exchange or incorporated in the UK.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

5. Grant expenditure

5. Grant expenditure
	2022	2021
	£	£
Grants committed to by the Charity in the year :
Anawim	30,000	(45)
Immediate Theatre	35,000	105,000
Women Resource Centre	-	250
Women Centre Ltd	50,000	-
Angelou Centre 2	-	120,000
Bawso 2	-	150,000
Contact	-	150,000
Magdalene Group	-	120,000
Emergency Covid-19 - Bawso 2	-	15,600
Emergency Covid-19 - Magdalene Group	-	8,217
Emergency Covid-19 - The Nelson Trust	-	10,000
Emergency Covid-19 - Southall Black Sisters Trust	-	15,000
Emergency Covid-19 - Stockport Womens Centre 2	-	16,721
Emergency Covid-19 -The Connection at St Martin’s 2	-	5,000
Emergency Covid-19 - The Theatre Artists Fund	-	20,000
Emergency Covid-19 - Winner, The Preston Road Women's Centre	-	15,000
Emergency Covid-19 - Women Centre Ltd	-	10,000
Clore Social Leadership Programme	-	24,000
The Connection at St Martin's (SET)	41,840	-
Winner, The Preston Road Women's Centre	150,000	-
20 Stories High	105,000	-
Nelson Trust 2	50,000	-
Southall Black Sisters	40,000	-
Travelling Light	105,000	-
Trinity	150,000	-
EndViolence againstwomen	40,000	-
	796,840	784,743

The above comprises of the total value of charitable donations which have been committed to during the period by the Charity.

6. Trustees remuneration and expenses

There are no employees and the Trustees received neither remuneration nor expenses in the current year or prior period.

7. Investments

	2022 2021 £ £ 3,732,660 3,181,068 1,601,620 3,562,168 (1,868,321) (3,699,237) 9,536 688,661 3,475,495 3,732,660 3,246,437 4,192,264
Listed investments - UK (Classification is based on the country of incorporation or listing) Opening market value Additions at cost Disposals at opening book value Net unrealisedgain/(loss)
Closing market value
Cost at 1 April

Investments are valued by reference to observable data or other quoted market prices. The investment allocation follows SORP disclosure guidance.

COUTTS CHARITABLE FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS

8. Grants payable

	Due within one year Due after more than one year 2022 2021 2022 2021 £ £ £ £ 40,000 40,000 80,000 40,000 40,000 30,000 - - 41,840 83,679 - - 60,000 60,000 - 60,000 50,000 50,000 100,000 - 40,000 80,000 - 40,000 50,000 50,000 50,000 50,000 - 12,000 12,000 12,000 50,000 100,000 - 50,000 35,000 70,000 - 35,000 40,000 40,000 - 40,000 35,000 - 35,000 - 50,000 - 50,000 - 35,000 - 35,000 - 566,840 615,679 362,000 327,000
Stockport Women's Centre 2 Tender Education & Arts The Connection at St Martin's (SET) The Connection at St Martin’s 2 Winner, The Preston Road Women's Centre Angelou Centre 2 Bawso 2 Clore Social Leadership Programme Contact Immediate Theatre Magdalene Group Travelling Light Trinity 20 Storieshigh

9. Commitments

9. Commitments
	2022 2021 £ £
Grant commitments recognised at the start of the year New grant commitments charged to the Statement of Financial Activities in the year Grants paid during year	942,679 904,526 796,840 784,743 (810,679) (746,590)
Within one year More thanone year	928,840 942,679
	566,840 615,679 362,000 327,000
	928,840 942,679

10. Related party transactions

Coutts is the primary funds provider of the Charity. Coutts may, by written notice to the Trustees, appoint up to 60% of the total number of Trustees from time to time.

No Trustee or other person related to the Charity had any personal interest in any transaction entered into by the Charity during the period.

The Trustees Coutts Charitable Foundation 440 Strand London WC2R 0QS United Kingdom

6 December 2022

Our ref CCF001/EAF/LMC

Ladies and Gentlemen

Post‐Audit Report – Year ended 1 April 2022

The purpose of this letter is to bring to the attention of the findings from our recent audit of the financial statements of Coutts Foundation, for the year ended 1 April 2022, for your consideration and to enable you to address matters arising where appropriate. Throughout this letter, “you” and “your” refers to the Board. “We” and “our” refers to Buzzacott LLP. We appreciate that you will already be aware of some of the matters contained in this letter. However, in accordance with International Standards on Auditing (UK) (ISAs) we are communicating them to you formally.

1. Purpose of the audit

As auditor, we are responsible for performing the audit in accordance with ISAs (UK), which is directed towards forming and expressing an opinion on the financial statements for the year ended 1 April 2022 that have been prepared by management with the oversight of those charged with governance, and other matters required by legislation.

Our audit work included consideration of the internal controls relevant to the preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of your system of internal control.

The matters being reported are limited to those that were identified during the audit and that we conclude are of sufficient importance to merit being reported to those charged with governance.

2. Audit progress

We would like to take this opportunity to thank all those with whom we dealt during the audit for their assistance and co‐operation, in particular Clare Richards and Francesca Wilson.

3. Annual report and financial statements’ format

The financial statements have been prepared, as last year, in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice (Charities SORP FRS 102).

There are no significant changes to the format of the financial statements this year.

4. Auditor’s report

We do not propose any modifications to our audit opinion and, therefore, we intend to issue an unqualified opinion in our auditor’s report.

The wording of our auditor’s report is unchanged from last year.

5. Adjustments made during the audit

There has been one adjustment made to the figures presented to us for audit which we wish to bring to your attention. A description of the adjustment which has been made to the figures presented to us for audit is attached as Appendix A.

6. Unadjusted misstatements

We are pleased to report that we found only clearly trivial misstatements during our audit for the period.

7. Accounting policies, accounting estimates and disclosures

The accounting policies used in preparing the financial statements are unchanged from the previous year.

Our work included a review of the adequacy of disclosures in the financial statements and consideration of the appropriateness of the accounting policies and estimation techniques adopted by the charity. We found the disclosed accounting policies, significant accounting estimates and the overall disclosure and presentation to be appropriate for the charity.

We have no specific observations to make in this regard.

Page 2 of 14

The Trustees Coutts Charitable Foundation

6 December 2022

8. Letter of representation

We enclose the draft letter of representation which we will request management and the trustees to approve and sign at the same time as the financial statements.

9. Segregation of duties

We recognise that the number of your accounting staff seconded to you makes a complete system of internal control impracticable and that the trustees exercise close personal supervision, which we consider reasonable in the circumstances. We have taken this into account in conducting our audit and in preparing this letter.

10. Accounting and internal control systems

Our work during the audit included an examination of some of the charity’s transactions, procedures and controls with a view to expressing an opinion on the financial statements for the year ended 1 April 2022.

This work was not directed primarily towards discovering weaknesses, other than those that would affect our audit opinion, or towards the detection of fraud. We have included in this report only matters that have come to our attention as a result of our normal audit procedures and consequently our comments should not be regarded as a comprehensive record of all weaknesses that may exist or of all improvements that might be made.

We found no significant deficiencies in the accounting and internal control systems during our audit.

Page 3 of 14

The Trustees Coutts Charitable Foundation

6 December 2022

11. Materiality

Materiality threshold £71,000

Reporting threshold: £3,700

Materiality refers to the relative significance of a particular matter in the context of the financial statements as a whole. An item would be considered material if its omission or its erroneous inclusion would reasonably influence the decisions of those using the financial statements.

We are required to report corrected audit misstatements, and uncorrected audit misstatements in excess of our reporting threshold which is set at 5% of overall materiality.

Our materiality threshold is based on 1.5% of gross assets. A lower level of materiality may be selected for specific areas of the financial statements and for some disclosure items e.g. transactions and other financial arrangements with trustees and their connected persons.

When considering the impact of misstatements discovered during the course of our audit and considering the implications for our report of such misstatements, we will refer to this level amongst other things. Whether a misstatement is ‘material’ or not is ultimately down to the auditor’s judgement.

12. Professional ethics

In accordance with our profession’s ethical guidance there are no further matters to bring to your attention in relation to Integrity, Objectivity and Independence.

13. Current developments

Revised auditing standards

The audit work we perform must comply with all relevant International Standards on Auditing (UK) (“ISAs”) which are set by the UK’s Financial Reporting Council (“FRC”). ISA (UK) 315 Identifying and Assessing the Risks of Material Misstatement Through Understanding of the Entity and Its Environment, (‘ISA 315’) has recently been reviewed and amended by the FRC and the revised version introduces major changes in the approach auditors must follow to risk identification and assessment in all audits. This will be applicable to your audit for the year ending 1 April 2022.

To help prepare for the implementation of ISA 315, charities can refer to the Charity Commission guidance Internal financial controls for charities (CC8) , which includes a checklist to assist in evaluating the internal financial controls in place. There is also information on the control environment for charities in Practice Note 11 (Revised) The audit of charities in the United Kingdom , particularly in paragraphs 86 to 95.

Page 4 of 14

The Trustees Coutts Charitable Foundation

6 December 2022

We have also attached a summary of other recent and ongoing developments as Appendix C to this report. The matters included in this appendix may not all be directly relevant to the charity. However, we are aware that a lot of trustees are involved with more than one organisation, therefore we have included items for general information.

14. Updates, insights and seminars

As part of our commitment to the charity sector, during the year the Charity Team issues occasional Updates and Insights on matters of relevance to the sector and also holds a number of seminars free of charge throughout the year. We would be delighted to welcome representatives of your charity to our seminars or to add trustees and management to our email distribution lists if this would be welcome. News and Insights are also available on our website at News and insights (buzzacott.co.uk), where there is also an opportunity to sign up to our mailing list should you wish.

Conclusion

This letter has been prepared for your private use only. It has been prepared on the understanding that it will not be shared with any third party without our prior written consent and we can therefore assume no responsibility to any other party. Any recommendations contained herein are based on the information you have provided and UK law and judicial and administrative interpretation as of the date of this letter. Should the facts provided to us be incorrect or incomplete, or should they change, our recommendations may be inappropriate. Buzzacott LLP accepts no liability for losses arising from changes in UK law, interpretation or practice or in public policy that are first published after the date of this letter.

If you require any further information or assistance, we shall be very pleased to help you.

We would be pleased to receive your comments and reaction to this letter.

Yours faithfully

Page 5 of 14

The Trustees Coutts Charitable Foundation

6 December 2022

Appendix A: Adjusted and unadjusted misstatements

Adjusted misstatements

		Statement of Financial Activities	Statement of Financial Activities
		Debit	Credit		Debit	Credit
		£	£		£	£
1	DR Expenditure		51,201
	CR Donated services			51,201
	Being donated services for this year from services provided
	by Coutts

The above adjustments has no effect on the reserves of the charity.

Page 6 of 14

The Trustees Coutts Charitable Foundation

6 December 2022

Appendix B

Coutts Charitable

Post‐Audit Report

For the year ended 1 April 2022

Current developments

Trustees’ Annual Report and Accounts

Environmental reporting and sustainability in charities

Larger companies are now required to report on environmental policy and sustainability in their annual report. The regulatory requirements for environmental reporting are limited to:

Only large and medium UK companies are legally required to report their greenhouse gas emissions in their strategic reports (under the Streamlined Energy and Carbon Reporting (SECR) requirements); and
Only quoted companies must address their environmental impact in any more detail.

These mandatory requirements also apply to large charitable companies, but smaller or unincorporated charities may wish to report on environmental factors by considering the following activities: greenhouse gases, water, waste, materials and resource efficiency, biodiversity and ecosystem, and emissions to air, land and water. Charities should also be aware of the legislation that is directly applicable to their activities and be able to demonstrate they are complaint using both qualitative descriptions and quantitative data.

For further details on how to consider environmental reporting in charities please see the following: https://www.civilsociety.co.uk/finance/environmental‐reporting‐and‐sustainability.html

Grant maker practices

A project carried out by Giving Evidence has looked at publicly available information for 100 UK grant makers. They were assessed on their public disclosures on diversity, transparency, and accountability with an aim for grant making charities to consider their public appearance and where they can improve standards. Of the 100 foundations tested, only 3 scored the highest A rating, with most in the sample scoring best on transparency and worst on diversity. Further information on the project can be found at:

https://www.foundationpracticerating.org.uk/

Reporting Diversity Data

The Charity Commission has been asked to make reporting diversity information about charity senior leaders and trustees mandatory in annual reports. Currently, publicly available information of the diversity of charity leaders is “incomplete and out of date” so a coalition of 65 organisations have advised the change in line with new FCA rules. The FCA requires listed companies to disclose numerical data on the gender and ethnic diversity of their board and executive management. The Charity Commission has said they will consider the recommendations as part of their ongoing work on the issue. The shadow charities minister has also said “increased transparency at

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charities is needed” and the Charity Commission should take action on “recommendations to collect data on protected characteristics among charity trustees and executives”.

The open letter to the Charity Commission can be found at https://www.money4you.org/operationtransparency/

New programme to boost diversity in boardrooms

A pilot Boardroom Apprentice programme has been launched by the Government’s Levelling Up initiative to boost diversity in public boardrooms. The programme aims to more closely reflect the communities in which they serve across the UK, with candidates receiving practical boardroom experience, knowledge and skills.

For more information please visit: https://www.gov.uk/government/news/new‐programme‐aimed‐to‐boost‐ diversity‐in‐boardrooms

Policy and Governance

Charities Act 2022

The Charity Commission has published guidance on changes to be implemented by the Charities Act 2022, expected to come into force from Autumn 2022 and will be staggered throughout 2023. A summary of the key changes are:

Charities will be able to pay Trustees for providing goods or services to the charity that are beyond the usual trustee duties (Autumn 2022);
Trustees will have the power to process small amounts of ex‐gratia or moral payments without applying to the regulator. For example, if a charity receives a legacy but there is evidence the donor has changed their mind since making their will (Autumn 2022);
Reduced complexity surrounding fundraising appeals that do not reach, or exceed, the intended target. This includes charities no longer having to wait six months for donors to ask for a refund. In addition, if donations less than £1,000 can be spent on purposes other than those intended, they can act without the involvement of the Commission (Autumn 2022);
Changes to how charities sell, lease or transfer land (Spring 2023);
Greater flexibility will be introduced to make use of permanent endowments (Spring 2023); and
Changes to how charities can amend their governing documents (Autumn 2023).

The guide can be found at https://www.gov.uk/guidance/charities‐act‐2022‐guidance‐for‐charities

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Recruiting young trustees

Our Bright Future, a partnership led by the Wildlife Trusts and funded by the National Lottery Community Fund, has published a guide to help charities recruit young trustees to their board. The guide includes case studies and templates for charities that would like to recruit young people, and a six‐step approach for supporting young trustees in their role. The guide can be found at: https://ourbrightfuture.co.uk/wp‐ content/uploads/2022/05/Young_Trustees_Advice_Pack.pdf

Charities and remote meetings

From 22 April 2022, the Charity Commission has confirmed that charities will need to move back to face‐to‐face meetings unless their governing documents allows remote meetings to be held. The flexibility of online meetings was introduced in April 2020 but as Covid‐19 restrictions have come to an end this flexibility is being removed. The regulator has also said they will no longer give charities extensions to filing deadlines.

Information on how to amend governing documents if needed can be found at:

https://www.gov.uk/guidance/coronavirus‐covid‐19‐guidance‐for‐the‐charity‐sector

Companies House reforms

In February 2022, the Government Department for Business, Energy and Industrial Strategy (‘BEIS’) published its Corporate Transparency and Register Reform White Paper. The reforms are designed to increase transparency and clamp down on abuse of UK corporate structures for money laundering.

These changes are very likely to become law, however there is currently no timetable for the introduction of the new rules.

The key changes are as follows:

Reduction in filing options for small companies

The reforms will simplify the framework for smaller entities by reducing the filing options to just two categories: micro‐entities and small companies. The abridged and “filleted” accounts options will be removed and therefore all small companies will be required to file a directors’ report and profit and loss account (as well as a balance sheet).

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Strengthening of Companies House powers
The government will extend the powers of Companies House to query, seek evidence for, amend or remove information on the register, and to share it with law enforcement if certain conditions are met.
Identity verification for those setting up, managing and controlling companies

The government will require identity checks on directors of companies, general partners in Limited Partnerships, designated members in LLPs and people with significant control (PSCs). Individuals who fail to verify their identity will be subject to new criminal and civil sanctions.

Restrictions on corporate directorships
Corporate directorships will be restricted to entities registered in the UK, and the corporate directors will need to be associated with natural persons who will be subject to identity checks. Different rules will apply to corporate members of LLPs or corporate general partners of LPs but with a similar aim of increasing transparency over the control of these entities.
More information on a company’s shareholders
The reform proposes a requirement for private companies, and traded companies where shareholders hold at least 5% of the issued shares of any class of the company, to provide a one‐off full shareholder list. Any changes will be updated annually when a company files a confirmation statement.
“File once” approach

The government is considering a new approach so that accounts will only need to be filed once instead of separately to Companies House, HMRC and other agencies.

Maintaining public trust

The Charity Commission has said that charities should not be complacent in their efforts to maintain public trust. Research conducted on behalf of the Charity Commission found that public trust in charities has risen slightly in 2020‐21, after reaching an all‐time low in 2018 following a “number of scandals” in the sector. The regulator has said trustees are key in ensuring charities public’s expectations are met through high standards of governance and compliance with duties.

Please see: https://www.gov.uk/government/publications/research‐into‐public‐trust‐in‐charities‐and‐trustees‐ experience‐of‐their‐role

Investments update

The Charity Commission has published guidance to help trustees make decisions on responsible investment. Trustees at all charities can decide whether or not to adopt a responsible investment approach that reflects the charity’s purposes and values, and not just focus on the financial return.

The guidance states “You can decide that rather than just focusing on the financial return on an investment, your approach will also take into account your charity’s purpose and values.”, i.e. health charities avoiding investments

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in companies whose products harm public health/environmental charities actively seeking to invest in renewable energy.

‐ The full published guidance can be found here: https://www.gov.uk/government/consultations/charity responsible‐investment‐guidance/responsible‐investment‐draft‐guidance‐for‐consultation

A review of investments in 2021 encompassing the outlook for 2022 can be read at:

https://www.buzzacott.co.uk/insights/investment‐review‐of‐2021

Identity theft

Companies House have reported they deal with up to 100 cases of corporate identity theft every month. This involves stealing of business information and using it for personal gain.

The organisation offers a service called ‘Protected Online Filing’ (PROOF), which aims to protect companies from the threat of corporate identity theft. It allows filings at Companies House to be submitted using an authorisation code known only to the company and advisors.

More information of how to sign up for this free service can be found at:

https://ewf.companieshouse.gov.uk//seclogin?tc=1

Cyber security breaches in larger charities

The government’s Cyber Security Breach Survey has found that 62% of charities with income over £500,000 reported having some form of cyber security attack in the year to March 2022. This increased to 76% for charities with income over £5,000,000. Whilst businesses continued to be targeted more than charities, about a quarter of charities said they faced cybercrime at least once a week in the form of phishing emails. In addition, 9% of charities said a cyber‐attack had left them unable to access files temporarily. These findings are from responses from 424 charities and 1,200 business located in the UK. The detailed government report can be read at: https://www.gov.uk/government/statistics/cyber‐security‐breaches‐survey‐2022/cyber‐security‐breaches‐survey‐ 2022

Charity Commission – Improving charity data

The Charity Commission is focusing on improving data collection over the coming years, with an introduction of broader classification codes on the charity register expected soon (giving more specific options of what the charity does and its objects etc). This will enable organisations to accurately represent their activities, with information becoming more relevant to the public. It is also expected the 2023 Annual Return will feature a

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‘library’ of questions which charities can answer as their circumstances require, enabling a more streamlined experience.

The long‐term goals include more direct communication with individual trustees to help and support them in their roles.

Further details can be found at: https://charitycommission.blog.gov.uk/2022/03/22/your‐role‐in‐improving‐ ‐ charity data/

Charity Commission proposes additional questions on the annual return

A 12‐week consultation commenced in June for potential changes to the Charity Commission Annual Return. The proposed new changes are around financial governance, charity operations and structure, and employees and volunteers. One of the proposed new questions asks charities to confirm whether specific thresholds have been exceeded (e.g. whether 70% or more of total income is dependent on one income stream, or whether 25% of more comes from donations). The regulator hopes this will enable them to collect more targeted information to help with its longer term data‐driven, long‐term strategy.

Changes will apply to charities’ financial years starting on or after 1 January 2023. For more information on the consultation, please visit the Charity Commission website

https://www.gov.uk/government/consultations/charity‐commission‐revisions‐to‐the‐annual‐return‐2023‐25

Staff recruitment and retention

As charities seek to recover from the pandemic, one of the key issues affecting organisations is staff recruitment and retention. Employment experts believe charities are facing an “exodus” of staff due to increasing pressures such as overwork, burnout, and low pay. The return to the office has also been a contributing factor to staff retention in the sector. All these factors combined have highlighted a staff turnover in the not‐for‐profit sector of 18.1%. The recruitment crisis is likely to be heightened as charities lose experienced staff, replaced by staff with little knowledge of their organisation.

Charities can implement a range of strategies to increase staff retention including offering flexible working options, clear career progressions, a strong team culture and focus on staff wellbeing.

For further analysis, please see: https://www.stoneking.co.uk/literature/e‐bulletins/how‐can‐charities‐retain‐ their‐best‐staff

Should Charities invest in cryptocurrency?

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The use of cryptocurrency is growing in the mainstream economy as it continues to become a possible route for investing. The Treasury has said they will introduce legislation to regulate certain cryptocurrency to “make the UK a global crypto asset technology hub”. However, the Charity Commission has warned of the risks to charities who invest in crypto assets largely due to its volatile value.

Overall, very few charities are engaging with cryptocurrency, with some charities accepting donations but immediately converting them into regulated currencies. The Charity Commission has emphasised the importance of “knowing your donor”, which can be difficult as blockchain (the system that tracks the exchange of crypto assets) has been built on anonymity. They consider that trustees should be cautious about “delving into this world” given their requirement to follow the core trustee responsibilities.

The Charity Commission full article can be found at:

https://charitycommission.blog.gov.uk/2022/07/12/cryptocurrencies‐what‐are‐they‐and‐should‐charities‐use‐ them/

Compliance

Safeguarding

The Charity Commission has published a guide on the responsibilities for charities and trustees to keep everyone safe including staff, volunteers, and beneficiaries. Trustees must ensure their charity identifies and manages risks, have safeguarding policies and practices in place, carry out relevant checks (e.g. DBS), protect volunteers and staff, and have procedures to handle and report incidents appropriately.

A detailed overview of safeguarding in charities, and how to implement the above action points can be found at: https://www.gov.uk/guidance/safeguarding‐for‐charities‐and‐trustees

Tax

Charity tax returns – why are they so important?

Whilst it is not compulsory for charities to file a tax return, HMRC is able to perform random checks on charities to ensure exemptions are being claimed correctly. There is no blanket exemption on income generated by a charity because of their charitable status. If a charity receives income that does not fall under the available exemptions, then the profit element of the income will be subject to tax. The main forms of exempt charitable income are:

Donations and legacies;
Trading income, where this derives from activities in furtherance of or ancillary to the charity’s objectives, or activities carried out by the charity’s beneficiaries; and

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Certain investment and property income.

If there is non‐charitable trading income that does not fall under the above exemptions, the small‐scale taxable trades exemption can be applied whereby a tax liability will not be applied if the non‐charitable trading income is less than 25% of the charity’s total income, subject to a cap of £80,000. If £80,000 is breached, the total non‐ charitable trading income will be taxable.

Further information can be found at: https://www.buzzacott.co.uk/insights/charity‐tax‐returns‐why‐are‐they‐so‐ important

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