The Old Etonian Trust (Limiled by guaranlee) Council's Report and Financial Statements For the year ended 31 December 2022 Registered Company Number 359518 Registered Charity Number 1151597 The Old Etonian Trust (Limiled by giiarantee) Council's report and financial ststements Contents Page Members of the Council List of Advisers Council's report Statement of r¢sponsibilities of the membe￿ of the Council Independent auditors. report Statement of Financial Activities io Balance sheet Statement of cash flows 12 Notes The Old Etonian Trust (Limiled by guaranlee) Trustees ("members of the Council") AGR Windham CVO Lord Bridges KCVO PAD Inkin RB Landman RDO Macleay PJ M¢Kee CJ Robarts Lord Suffield Lord Waldegrave of North Hill (Chairnian) (Secretary) Principal address The Old Vicara8¢ Great Honnead Buntingford Hertfordshire SG9 oKr List of advisers Bankers Coutts & Co 440 Strand London WC2R OQS Solicitors Farrer & Co LLP 66 Lincoln's Inn Fields London WC2A 3LH Statutory auditors Price Bailey LLP Causeway House l Dane Street Bishop's Stortford Hertfordshire CM23 3BT The Old Etonian Trust (Limited by guai'antee) Council's report Constitution The Old Etonian Trust is a charitable COTnpany limited by guarantee which was incorporated on 24 February 1940, its company registration number being 359518. It is govemed by memorandum and articles of association, which were updated during 2018 to reflect an update the objects. The principal objects are the advancement of education and the furtherance of charitable objects connected with Eton College. It acts as custodian of certain charitable trusts connected with Eton, of which the most important are the Hornby Steer Fund and the War Memorial Bursary Fund. During 2018, the assets and liabilities of The Henry VI Charity, which totalled £6.2 million. were transferred to The Old Etonian Trust. A separate unr¢strActed ￿nd, the Henry VI fund. has been created and is used lor the provision of bursaries to support education outside the maintained sector. This also resulted in the Hornby Steer Fund being classifi¢d as r¢stri¢t¢d. Thes¢ trusts are reported on below. The Members of the Council confirni that they have referr￿1 to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the charity's aims and objects and in planning future activities and setting policy for the year. Th¢ day-to-day management of the charity is largely carried out by the Secretary, who is responsible for managing the accounts and bursary awards. The Council makes the key decisions on investment policy and the fi￿dIng available for bursaries. The Charity does not carry out any significant fundraising activities and does not work with professional fundraisers or companies who carry Out fundraising on its behalf. During the year, no complaints or issues have arisen as a result of any fimdraising activities. Fund accounting Unrestricted fi￿dS are general funds that are available for use at the discrdion of the Council in furtherance of the objectives of the dwity. Restiicted fijnds are those donated for use in a particular area or for sp￿IfiC PUTPOS4 the ￿Se of which is r&8tricted to that area or purw. Reserves policy The Council has reviewed the Charity's ne￿j for reserves in line with the guidance issued by the Charity Commission. The intention is to distribute income fully each year together with an element of capital growth. with the balance of capital growth retained in the fund to accommodate future increases in school f￿$. However, this is without prejudice to the Council's discretion either to accumulate income when demand for bursaries is low or to distribute accumulat¢d fill]ds when demand is high. Total fi￿d5 were £15.4 million at 31 December 2022 of which £6.8 million were unrestrictsj. The Council Ix)nsider this level to be reasonable given investment pafomiance and the current demand for bursaries. The Council aims to maintain c&sh balances to covff at least one year of forward bursary commitments. Investment policy The Investment Committee meets thr¢¢ times during each year to provide advice and guidance to the Council on invastment policy. Inv&8tment decisions are b&8ed on the perfonnance of those fimds. which is monitor&l on a regular b&8is with at le&8t quarterly valuations. The Council's policy is to maxirnise the return on invastments for an acceptable l¢v¢l of risk that 15 comTnensurate with achieving a Specifi￿ level of incolne. The investment objective is to achieve a balance between capilal growth and a steady, growing level of income from a multi asset portfolio, predominantly investing in equitias and bonds. The Old Etonian Trust (Limiled by guarantee) The aim of the portfolio is to generate sustainable income, growtng at least in line with sch￿1 fees Inflatio￿ as far as possible. The Council aims for annual ¢xp¢nditure that is bas￿1 on investment income consistent with the MSCI World index together with an allowance for capital growth. tnv&stments are in authoriwj funds giving a wide spread of s¢¢urities managed by highly reputable fllW)cial institutions. The Charity continues to hold £0.7 million in cash. which is expected to enable it to maintain the current level of bursaries over the next few years. During 2022, there have been net losses on invesiments of £1.9 million (2021.. nel gain £2.8 million), which is a decrease of I ￿/0 reflecting an increase in stock market values during 2022. The total return on the investment portfolio was a net loss 80/0 (202].. netgain 20/00). The Investment Cotnmittee monitots perfonnance of the portfolio comparal to benchmark indices. The MSCI All County World Index fell by 10/0 during 2022. . Grant making The Council agrees the maximum amount of funds available for butBary awards each year. Applications for bursaries are Consider￿ by the Bursary Committee at Eton. Awards are assessed on grounds of financial need and the perceived quality of the applicant and are reviewed regularly, being liable to withdrawal should circumstances chang¢. Awards are approved by the Chairnian and the Secretary. Awards are paid d1￿ctlY to the school. Travel bursaries are considered by a separate committee at Eton and are subsequently approved by the Chainnan and the Secretary while other specific grdnts are decid￿ by the Council. Risk assessment The Council has reviewed the major risks associated with the Charity and is sat15fied that systems are in place to mitigate those risks. It has identified the following key risks- Misuse of the trust funds by recipients. The Council seeks to limit exposure through fimding policies. the Charity do￿ not provid¢ fijnding to educational institutes bas¢d outside the UK and d(K5 not make payments direct to an individual. A decline in investment perforniance resulting in income being insufficient to meet demand for bursaries or to meet existing commitments. The Council seeks to mitigate this by investing in a spread of authorised funds giving a spread of securities, with perforniance being monitored on a regular basis. Significant school fee inflation could limit th¢ Chartty's ability to meet demand. The Charity could use capital to meet higher demand but this will impact the level of funding that can be provided in the long t¢rni. The level of bursary commitments is based on forecasts of future income and is monitored closely. Fraud, principally the misappropriation of cash or investments. Two signatures are required on all cash transactions over £500, schedules of commitments are cross- checked with Eton, and investment changes also requtre two signa￿re5. Political action against private education. If this were sufficiently significant. Council would need to review usas for its funds Consistent with th¢ ternis of the Trust Deed. Future plans The Council aims to continue the advancement of ￿UCatIon and the furtherance of charitable objects connected with Eton College based on the returns achieved on the Charity's investments. The Old Etonian Trust (Limited by guarantee) CouncRI members and employees Under the temis of the Trust Deed. the power of appointing new Members of the Council is vested in the existing Members of the Council. There are no employees of the Trust and Members of the Council receive no r¢muneration for their services. Under the articles of association, the governing body of Eton College, which receives bursaries from The Old Etonian Trust. has the right to nominate two members of the Council. It has nominated Lord WaldegrdV¢ and Mr McKee. who are the Provost and Vi¢¢ Provost of the governing EK)dy. Policies for the induction and trainlng of Couneil members The Council members have been in wst for a number of years a￿1 new Council members ar¢ apwinted infrequently. When new manbo5 are apFOTnt&l they are provid￿ with a copy of the Articles of Association and are briefal on the aims and objectives of the trust and directed to the Charity Commission guidance to a]sure they undet5tood the ml&8 and respo￿8￿bIlIti￿S of a War Memorial Bursary Fund The War Memorial Bursary Fund has awarded bursaries to the sons or grandsons of Old Etonians whose parents would not otherwise be abl¢ to afford the Eton fees. During the process for registration as a charity, The Charity Commission required this restriction to be removed as it considered it did not represent a public class. The fund is now used to provide buisaries to boys in general at Eton. Six bursaries were in operation during the year costing £162,703 (2021.. 9 cosling £142.85]) with a total commitment at the year-end of £491,186 (2021.. £724.244). The value of th¢ fund at the year-end was £5.3 million (2021.. £5.9 million). General Fund The Generdl Fund is solely used to administer the Charity's investments and bank accounts. CJ Rowlatt Legacy Fund The CJ Rowlatt Legacy Fund provides for the improvement and upkeep of Luxmoore's Garden and other College gardens. In 2022 an amount of £1,700 was allocated from the fund, which includes a donation of £1,000 from the Swire Charitable Trust, towards the upkeep of Luxmoore's Garden (2021.. £1, 700). The value of the fund at the year-end was £27k (2021.. £31k). HK Marsden Memorial Fund This fund has been built up from donations and provides trdvel grants to knys at Eton. Twenty three travel bursaries were awarded totalling £8,100, and three previous awards were cancelled, resulting in a repayment of £920 during the year (2021.. no awards, I previous award cancelled £230). The value of the fund at the year-end was £236k (2021.. £264k). Hornby Steer Legacy Fund This fund was created in 1994 with a legacy from William Hornby Steer amounting to £1.6 million. The fund was fonned for the advancement of education and the furtherance of charitable objects connected with Eton College. The Council allocated £800,000 of the ￿nd to Eton College to assist with the rebuilding of the Drawing Schools. The remainder of the Fund is currently being used to provide bursaries. Five bursaries were in operation during the year costing £105,825 (2021.. 5 costing £58. 724) with a total commitment at the year end of £206,980 (2021.. £280,609). The valu¢ of the fund at the year-end was £3.0 million (2021.. £3.4 million). The Old Etonian Trust (Limited by guaranlee) Henry Vl Fund This fund was created in 2018 following the transfer from The Hairy Vl Charity of net assets totalling £6.2 million. The Henry VI Charity was established in 1973 as a general educational charity whose purposes include the provision of bursaries to schools outside the maintained sector. The Henry VI Fund will continue to be used for the sam¢ purposes. Nine bursaries were in operation during the year costin8 £195.533 (2021.. 9 costing £189.83]) with a total commitment at th¢ year end of £903,936 (2021.. £540.160). The value of the fund at the year- end was £6.8 million (2021.. £8.0 million). In preparing this reporL the Council has taken advantag¢ of the small companies exemptions provided by section 415A of the Companies Acl 2(K)6. By order of the Council C J Robarts (Secretary) July 2023 The Old Etonian Trust (Limited by guaran¢ee) Statement of responsibilities of the Members of the Council The Members of th¢ Council (who are also directors of The Old Etonian Trust for the purposes of company law) are responsible for prepaTing the Council's report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Genernlly Accq)ted Accounting Prdctice). Company law requires the Members of the Council to prepare financial statements for each financial year. Under company law, the Members of the Council 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 charitable company and of ils incoming resources and application of resources, including its income and expenditure, for that period. In preparing these financial statements, the Members of the Council are rquired to: s¢l¢¢t suitable accounting policies and then apply them consistently. observe the Tnethods and principles in Ihe Charities SORP (FRS102)' make judgements and estimates that are reasonable and prndent. state whether applicable UK accounting standards and statements of recommended practice have been followed, subject to any material dq)artur¢s disclosed and explained in the financial statements. and prepare the financial statements on the going concern basis unle&s it is inappropriate to presume that the charity will continue in operation. The Members of the Council are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Trust and to enable them to ensure that the financial statem¢nts comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence for taking r¢asonable steps for the prevention and detection of fraud and other irregularities. In so far as the Members of the Council are aware: there is no relevant audit inforniation of which the charitable ￿mpanY'S auditor is unaware. and the Members of the Council have taken all steps that they ought to have taken to make themselves aware of any relevant audit infomiation and to establish that the auditor is aware of that infom]ation. The Old Etonian Trust (Limited by guarantee) Independent Auditors, Report to tbe members of The Old EtODian Trust Oplnion We have audited the fu￿￿[al S*atcM￿tsOfThe Old EILMianTnL¥t{the'dwitabiei¥xnpaTry') fortheyeareJKknI 31 DeeembKr 2022 which comprises the Ststementof Fitwicial Activilie& the bala￿¢￿ttE Statemart of cash flows andnotes to the f]nancial 8trtement4 including a summary of Si￿lFICant acCou￿gpo￿'cte& The final￿ rq￿rting ft7mewoth thathasbeen applied in the￿p￿Parali0n i5 applicable law aNI United Kingik>m Acc(uiting Stan(tsrd% i￿1￿]￿g Financial Re￿>rting StsJKlard 102 Th¢ Fin￿KIal R¢wrbn8 Standard applicable in theUK aTKI Rwblic of treland (iJnIt￿ Ktngdom G￿￿Y Accwj Accounting Pr￿tice). Inouropsnion the financial strtemenl&" give a t￿e and fairviewof the stat¢ofthe cllaritsble C￿npanY'S affairs as at 31 fkixth2022 8Thlof its incom sources 8t￿ application of Ir￿Vr¢¢& irKluding its income andex￿￿]Ivr¢ fOr￿￿rthen ended. have been prepared in accordatKe with th¢ requirements of the com￿1￿￿ A¢t2Q)6. Ba8is for oplnlon We cothcted ouraudit in accor￿ with Inten)￿o￿la1 Stsndarth C￿ Auditing (UK) USAS (UK)) and44)licable law. Ch responsibilitieswiderthose sthndards fvrther dcsctilKd in the Atyjitor's re4￿￿SibilitI&￿ for the audit of the financial statements section of ourreport. We in(k￿le￿l0fthe charitableurfnpany in a(Xx)rdan(￿Wlththe ethical wirements that are rekvant to ouraudit ofthe f]llancial stateM￿ts in the UK itKluding the FRC'S Ethical Standard, aTKlwe have fvifthedour other ethical responsibiliti£8 in accordantt with tlL8e requir¢ll￿￿ We thatthe a￿11¢ evi(k￿C we haveobtaintij is sufficient and appropriate to provi(k abasis forLwopillirffL Conclusions rdating to golng concern In auditing the fJnarKial State￿ent% wehave (y)nchukd that thetnL4ees' ￿ of the going (%￿￿n￿as0f ￿cOUtiti￿ In the Ba￿d on the work wehave ￿f0Mle4 wehave not identified anynulerj￿ ￿t￿ti￿5 ￿lating to events or¢o￿ltionS tha¢ individually orcollectivdy. may cast Signif￿nt(￿jbt0n the d)aritablecompJn￿S ability to cotiti￿ &sagoingconcan fora iodofat leost twelve months from when the fll]a￿lal sktettthts atEauthoris￿l for i&9￿. this ICI￿. Other informatio The tn]stees sxeresponsible fortheother infO￿¥)1L Trots informati(￿ con]prisesthe inf0m￿tI¢M included inthe INstets' annual rqK>rt, other than the fLr&qncial sta(em￿¢S andourauditor's rqx)rt theteott (knopinionon the f￿￿￿l81 Stste￿￿ts do& not coverthe other Urf0rn￿tloll excw to theextent otIKrW￿ explicitly staknl in (Wret￿ Thrdo not expm any fomi of ass1￿[￿e conclusion tlveon. In connectson with Oura￿lI0r the f￿￿T￿la1 i8to ￿1 infomTrtion an(L in doing STr, consider Whet1￿ the other itthrn￿on is materially ttKOnSiStent with the flljancial staternents or(xwknOwl￿geob¢ained in the audit 0rothetivl￿ appears tobe materiallymisststcd. tf we thiiify swh material it￿On￿￿￿*S orapparntmateria] mi5&tatements, we are required io deterniine wlknthaE is ama￿la1 misstatement in the fill￿1a1 sthtementsora material mibslalement of the other inf0mlatio￿ If, based on the w(Mk wehave th￿there is a matetial mibsthiementof thi8 otherinfL¥matIo￿ we arerqU￿￿l to r4>￿t that tacL We have nothing to tErort in this ￿Ea￿. Oplnions on other tnatters prescribed by tbe Companks Ad 21x16 In our opllJiO￿ based on the work ulldertaken in th¢COu￿ of audi the infomiation given in the tsusttts, rCtK>rt{i￿￿g the dlrwt0￿. tEVKt) for the fmaJKial yearfor which the financial statements are preparEd isconsistent with the financial sta*mo)ts' and Matter5 on wbich are required to report by exception Jn the light of ourkwwledge and underthKling olthe charitable company axl its enviro￿1 obtaiti￿ in (he course of the audi¢ we have not identified rnaierial mi&4alements in tk ditEcto￿. We have twthing to iy)ort in of the followti]gmattersinre]at1(￿to whichthe Com￿leS A¢1 2￿)6r￿U]rrSU￿tO rqth to you if, in our opinio The Old Etonian Trust (Limited by guaranlee) visited byus; or the ruW￿la[ slalements alc￿1 in ag￿n￿l with the acc(xmtstt8￿ and certalli disclowrtsofdirect0￿, remumtroll stt¢ifvJby law aretNA m*k' or we havenotrEceived ail the info￿￿at1￿ at¥1 explanati￿We r&]uire forour audiL I Responsibllltses of trustees As explaitkd more fvlly in ￿￿trUS￿￿' re4xxthijititsststem￿l the trusteeslwkn are akn ts d]r￿lo￿Of the charithle company for the purp)sesof con]pany law) are WKMLsible for th pwtion of the financial statements and forbeing sa(isfied that they give a ttue aThJ fairview, and forswh inteJnal control &8 the trUStttsde*rrri￿ is ll￿¢858ry ￿ thablethepreparatioll of rjnancial statements tha( free frorn matrrial ￿ls￿temenL whe(herdue to fraudortrnr. going concem. di5closin& asappiicable. rnatters related togoing con(Ym and using thegoing concern basis ofattounting unles8 the tn]slees eitheriDtend to liquida* thecharitable company{Ktove, to (ktectmatttiat mis8t￿ts in IE4Ttttof inYgutaritic4 in¢luthng fiaud. The Sp￿lfiC prtth for thiseAJgagement atKI theextall towhith &e(z&thkof (kniog ]r[Egu￿ including fiaud is&tailed bEIow: petfomie(L with no Instanc￿ reviewing minuk%ofrneeting of those wÈthgovemance f￿￿1￿1 no of iwI￿ltiesOr fraud. perfomiitjg audItwod(overd￿ nskof management0￿￿je and (x)ntsuK review￿jOUrnat entriesalldrevi¢wing Because of the ]nhe￿It ]imitation8of an audiL thete isarisk that will (kwall ittegulariti￿ i1Kluding those kading to a material misSt&tement in the fmatKiai 5tatementsornon