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2022-07-31-accounts

The Child Health Research Charitable Incorporated Organisation

Report and financial statements

31 July 2022

Charity Registration Number 1152623

Contents

Reports

Reference and administrative information 1
Report of the Trustees 3
Independent auditor’s report 11
Accounts
Statement of financial
activities 15
Balance sheets 17
Statement of cash flows 18
Principal accounting policies 19
Notes to the financial statements 23

The Child Health Research Charitable Incorporated Organisation

Reference and administrative information 31 July 2022

Trustees Mr A Clark (Chairman)
Mr H Clarke (appointed 1 February
2023)
Professor A J Copp
Professor H Cross (appointed 1
September 2022)
Ms A David (resigned 31 October 2022)
Professor D Goldblatt
Mr H Snow (appointed 8 March 2022)
Professor R Smyth (resigned 1
September 2022)
Ms H Vinnicombe
Ms L Gibson (appointed 29 July 2022)
Finance Committee Mr A Clark (Chairman)
Ms L Gibson
Mr H Snow
Professor H Cross
Ms H Vinnicombe
Registered office UCL GOS Institute of Child Health
30 Guilford Street
London
WC1N 1EH
Charity registration number 1152623
Auditor Buzzacott LLP
130 Wood Street
London
EC2V 6DL
Bankers The Royal Bank of Scotland plc
280 Bishopgate
London
EC2M 4RB
Solicitors Birketts LLP
106 Leadenhall St
London
EC3A 4AA

The Child Health Research Charitable Incorporated Organisation 1

Reference and administrative information 31 July 2022

Investment managers Veritas Investment Management LLP 90 Long Acre London WC2E 9RA

The Child Health Research Charitable Incorporated Organisation 2

Report of the Trustees Year to 31 July 2022

The Trustees present their Annual Report together with the financial statements of the Child Health Research Charitable Incorporated Organisation (“the CHR CIO”) for the year ended 31 July 2022. The financial statements have been prepared in accordance with the accounting policies set out on pages 19 to 22 and comply with the Charity’s Constitution, the Charities Act 2011 and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102).

STRUCTURE, GOVERNANCE AND MANAGEMENT

The CHR CIO is a registered charity number 1152623 governed by its Constitution dated 11 May 2022.

The principal objects of the CHR CIO are to support the UCL Great Ormond Street Institute of Child Health (“GOS ICH”) in its mission to improve the health and wellbeing of children and the adults they will become through world-class research, education, and public engagement. GOS ICH is, with its clinical partner Great Ormond Street Hospital for Children NHS Foundation Trust (“GOSH”), Europe’s leading centre for child health research and education.

The CHR CIO does not actively fundraise but relies mainly on its investments to meet its objectives.

Meetings of the Trustees are convened on at least three occasions per annum. At these meetings, the Trustees agree the broad strategy and areas of activity for the CHR CIO, including consideration of grant making, investment, reserves and risk management policies and performance. At these meetings the Trustees also consider reports on the outcomes of the CHR CIO’s spending programmes. Trustees also receive verbal reports on selected programmes from the PhD students supported by their supervisor.

The Finance Committee (formerly the Investment Sub-Committee) convenes at least twice per annum and reports regularly to the main Board of Trustees. The Finance Committee is responsible for reviewing the financial statements in detail before approval by the main Board, as well as monitoring the external investment managers regarding the investment portfolio performance and giving advice regarding the cash flow of the CHR CIO.

Trustees are recruited by introductions from existing Trustees and others who are familiar with the work of the CHR CIO. Prospective Trustees are interviewed by the Chairman and Director of GOS ICH and asked to submit a CV for review at a Trustees' Meeting. Candidates must be elected by at least a 75% majority of Trustees.

New Trustees are provided with information concerning the finances, fundraising activities, and grant-making policies of the CHR CIO. Those who are not familiar with the legal obligations and responsibilities of a Trustee are provided with information published by the Charity Commission. Further induction is given to new Trustees by meetings with key members of the GOS ICH staff.

The Child Health Research Charitable Incorporated Organisation 3

Report of the Trustees Year to 31 July 2022

KEY MANAGEMENT

The Trustees consider that they, together with the GOS ICH Finance Manager and Institute Manager, comprise the key management personnel of the charity in charge of directing and controlling, running, and operating the CHR CIO on a day-to-day basis.

None of the Trustees receive any remuneration in respect to their services as Trustees.

All staff, including the key management personnel, are employed by the GOS ICH and their remuneration is set by their employers.

The GOS ICH Finance Manager and the Institute Manager are employees of GOS ICH and their services are provided through a recharge agreement between GOS ICH and the CHR CIO. Every month an allocation of their salary is recharged to the CHR CIO (10% in the case of the Finance Manager and 7% of the Institute Manager).

OBJECTIVES AND ACTIVITES

The purposes (objects) of the CHR CIO are, in such ways as the Trustees think fit, to:

The Trustees confirm that they have referred to the guidance contained in the Charity Commission’s general guidance on public benefit when reviewing the CHR CIO’s aims and objectives and in planning future activities and setting the grant making policy for the year.

The CHR CIO carries out these objects by:

By focusing on these areas, the charity can meet its strategic objectives and priorities.

The Child Health Research Charitable Incorporated Organisation 4

Report of the Trustees Year to 31 July 2022

OBJECTIVES AND ACTIVITES (continued)

The Charity has the following restricted funds which support various academic research projects:

The funding for these restricted funds is undertaken by individual fund holders and their supporters.

ACHIEVEMENTS AND PERFORMANCE

During the year, the CHR CIO received a generous donation from the Wheeler family to fund a Masters Student’s fees on the MSC Paediatrics in Child Health with Clinical Practice. This arrangement is anticipated to continue for at least another three years.

The Child Health Research Charitable Incorporated Organisation 5

Report of the Trustees Year to 31 July 2022

ACHIEVEMENTS AND PERFORMANCE (continued)

The CHR CIO continues to support early career researchers at the GOS ICH through funding 3-year PhD studentships. The CIO also continued to provide funding for several senior academic positions at the GOS ICH to support their work on child health. The CIO also restarted its summer studentship programme, which in recent years had been halted by the COVID-19 pandemic.

The CHR CIO offered a new international PhD project in collaboration with the University of Toronto/SickKids Hospital. The PhD student will spend up to 12 months on placement there as part of their second year PhD studies. In return, a University of Toronto student will also spend up to 12 months at the GOS ICH and GOSH.

A recurring grant was made this year as support for 10 bursaries for Postgraduate Students on courses run by the GOS ICH. This was aimed to encourage widening participation in postgraduate education. Each bursary was worth £3,000 to support the fees of each student.

GRANT MAKING POLICY

The charity has established a grant making policy to achieve its objects for the public benefit to improve the lives of children everywhere, namely finding better ways of diagnosing and treating sick children through research and then using those findings to improve health outcomes of those children throughout the world. The charity’s research programmes support students, academic and academic related staff at the GOS ICH and GOSH to find new pioneering cures for many rare diseases which affect children. With new knowledge and understanding, children’s lives can be improved significantly.

The Director of the GOS ICH receives proposals for funding from members of the GOS ICH and GOSH. These are reviewed for scientific quality and to make sure they align with the strategic research objectives of both Institutions. Once endorsed by the Director these are submitted to the charity for consideration and approval. Any grant applications are considered by the Board of Trustees before award letters are issued on behalf of the charity. This applies to applications against both restricted and unrestricted funds.

The projects are often for pump-priming, initial ideas and data collection before a full application is made to an external awarding body. The charity provides funds for bridging and infrastructure support (including building projects, laboratory refurbishments and equipment).

INVESTMENT POLICY AND PERFORMANCE

Under the terms of the Constitution, the Trustees have absolute discretion to manage and organise the charity’s investments. The Trustees, through the Finance Committee, have appointed Veritas Investment Management LLP to manage (with discretionary powers) the Child Health Research CIO portfolio.

The Child Health Research Charitable Incorporated Organisation 6

Report of the Trustees Year to 31 July 2022

INVESTMENT POLICY AND PERFORMANCE (continued)

The charity has a Statement of Investment Principles which has been approved by the Trustees. This statement includes the following stipulations regarding the specific investment objectives:

The Statement of Investment Principles includes the following Specific Investment Restrictions:

The Statement of Investment Principles will be subject to review as required by the Finance Committee and amendments will be advised in writing to the investment managers when applicable.

The Finance Committee meets at least half yearly to review the performance of the portfolio and the Investment Manager. The Investment Manager presents a report of the investment portfolio at each of these meetings.

The Child Health Research Charitable Incorporated Organisation 7

Report of the Trustees Year to 31 July 2022

INVESTMENT POLICY AND PERFORMANCE (continued)

The charity adopts a cautious approach given the uncertainties in the bond and equity markets. Turning to equities, the charity places emphasis on those companies whose abiding characteristic is to generate sustainable and growing cash flows whatever the state of the world economy. There is a focus on long term structural and demographic changes that inform investment decisions.

The total return for the 12 months to 31 July 2022 was 4.04% (2021: 21.3%) which was below the primary benchmark of 8.7% and above the ARC (Asset Risk Consultants) Sterling Equity Risk Index of -4.9%. The total return for FTSE All Share Index was an increase of 5.5% (2021: increase of 18.5%), MSCI All Countries World Equity Index (£) 2.3% (2021: 27.3%) and BofA MLynch £ Corporates (1-10 Y) -8.3% (2021: 3.6%).

FINANCIAL REVIEW

The Statement of Financial Activities shows a deficit of £989,918 (2021: surplus of £2,134,028) after investment gains for the year ended 31 July 2022. The figure excluding net investment gains was a deficit of £1,408,564 (2021: deficit of £967,368). Grants payable for the year totalled £1,547,803 (2021: £1,281,580).

The net current liability position on the balance sheet of £1,034,180 (2021: net current liability of £237,010) is a reflection of the accounting policy that makes full provision for multi-year grants when they are committed. However, the charity maintains a strong cash position and has adequate funds to meet these liabilities as they fall due over the duration of the grants.

A detailed analysis of grants payable highlighted that several grants had been incorrectly previously classified as unrestricted in previous years, despite meeting the requirements of restricted funds. A prior year adjustment to reallocate grant expenditure totalling £1,351,676 from unrestricted to restricted funds in respect of 18 grants made since 2016 was discussed with and subsequently approved by the Board of Trustees. The apportionment of investment management fees, investment income and unrealised and realised gains/losses was also recalculated as they are apportioned between the funds based on an average of the opening and closing balances. As a result, total unrestricted funds, total restricted funds and total endowment funds as at 31 July 2021 have been restated to £4,170,050, £9,022,689 and £4,435,358, respectively, compared to £2,507,289, £10,820,576 and £4,300,232 per the 2021 signed accounts.

RESERVES POLICY AND FINANCIAL POSITION

As stated above, the charity’s primary objective is providing funds for research at the GOS ICH. Research, by its very nature, requires a long term commitment to resources for success.

The Trustees believe that in normal circumstances, the charity needs between £1million to £2million of unrestricted reserves to take into account expenditure requirements and income fluctuation that may arise.

The Child Health Research Charitable Incorporated Organisation 8

Report of the Trustees Year to 31 July 2022

RESERVES POLICY AND FINANCIAL POSITION (continued)

At 31 July 2022, the charity had total funds of £16,638,179 (2021: £17,628,097). Of these, £8,797,150 (2021 restated: £9,022,689) were restricted and £4,533,260 (2021: restated £4,435,358) were endowment funds. Unrestricted funds, which constitute the charity’s free reserves, were £3,307,769 (2021 restated: £4,170,050).

The Trustees consider the level of general reserves (unrestricted funds of £3,307,769) are appropriate, taking into account their continuing commitments.

The charity has sufficient cash resources to meet its obligations both from the restricted and unrestricted funds but further cash requirements can be met by initially transferring monies held with the Investment Manager and subsequently realising investment assets.

RISK MANAGEMENT

The charity has for many years adopted a risk assessment policy as part of its strategic plan in meeting its principal objectives. The major risks to which the charity is exposed have been evaluated and systems have been established to lessen and where possible, eliminate these risks.

The key risks for the charity, as identified by the Trustees, are described below together with the principal ways in which they are mitigated:

Conflict of interest – Trustees may have a conflict of interest between their duties to the charity and their relationship with the GOS ICH. Such a conflict may arise in, for example, a decision in relation to a funding bid of which a Trustee’s department would be a beneficiary. This is mitigated by keeping the conflicts of interest register up to date and following procedures for Trustees to abstain from certain decisions if this is deemed necessary.

Portfolio management – There is a risk that there are unsatisfactory returns from the investment portfolio. This is mitigated by regular monitoring of the financial returns achieved during biannual Finance Committee meetings.

Monitoring of returns on investment – There is a risk that once a grant is awarded, for example to a PhD student, that the outputs from the research may not be as expected. To mitigate this risk, the Trustees work closely with clinical experts to determine the most appropriate projects for grant funding.

FUNDRAISING

The charity does not actively fundraise but does receive funding from a variety of sources including donations and legacies.

The Child Health Research Charitable Incorporated Organisation 9

Report of the Trustees Year to 31 July 2022

FUTURE PLANS

The CHR CIO intends to continue to make regular research grants to the GOS ICH. These grants will be for strategic initiatives, PhD studentships, summer vacation studentships, and to support staff salaries. The CHR CIO will also continue to provide transitional funding to support the salaries of exceptional academics through its Child Health Excellence Fellowship. Grants will also be made for one-off capital expenditure where agreed by the Trustees.

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

The Trustees are responsible for preparing the Trustees’ Report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Principles).

The law applicable to charities in England and Wales requires the Trustees to prepare accounts for each financial year which give a true and fair view of the state of affairs of the Charity and the group and of the income and expenditure of the group for that period. In preparing financial statements, the Trustees are required to:

The Trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Charity and which enable them to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the Constitution. The Trustees are responsible for safeguarding the assets of the Charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Approved by the Trustees on 15/03/2023 and signed on their behalf by Adrian Clark

Chairman

The Child Health Research Charitable Incorporated Organisation 10

Independent auditor’s report Year to 31 July 2022

Independent auditor’s report to the trustees of The Child Health Research Charitable Incorporated Organisation

Opinion

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

In our opinion, the accounts:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the accounts section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the accounts 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 accounts, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the accounts 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 charity’s ability to continue as a going concern for a period of at least twelve months from when the accounts 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.

The Child Health Research Charitable Incorporated Organisation 11

Independent auditor’s report Year to 31 July 2022

Other information

The trustees are responsible for the other information. The other information comprises the information included in the annual report and accounts, other than the accounts and our auditor’s report thereon. Our opinion on the accounts does not cover the other information and we do not express any form of assurance conclusion thereon.

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

We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities Act 2011 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement, the trustees are responsible for the preparation of the accounts 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 accounts that are free from material misstatement, whether due to fraud or error.

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

The Child Health Research Charitable Incorporated Organisation 12

Independent auditor’s report Year to 31 July 2022

Auditor’s responsibilities for the audit of the accounts

Our objectives are to obtain reasonable assurance about whether the accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these accounts.

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

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

The Child Health Research Charitable Incorporated Organisation 13

Independent auditor’s report Year to 31 July 2022

Auditor’s responsibilities for the audit of the accounts (continued)

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

As a result of our procedures we did not identify any key audit matters relating to irregularities.

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 non-compliance. 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 for the audit of the accounts is located 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 charity’s trustees, as a body, in accordance with section 144 of the Charities Act 2011 and with regulations made under section 154 of that Act. Our audit work has been undertaken so that we might state to the charity’s trustees those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Buzzacott LLP Statutory Auditor 130 Wood Street London EC2V 6DL

Date 30 March 2023

Buzzacott LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006

The Child Health Research Charitable Incorporated Organisation 14

Statement of financial activities 31 July 2022

Notes Un-
restricted
funds
£		 Restricted
funds
£		 Endowment
funds
£		 Total
funds
2022
£		 Total
funds
2021
Restated
£
Income from:
Donations and legacies
1
Investments
2
Total income
Expenditure on:
Raising funds
3
Charitable activities
. Grants payable
4
Total expenditure
Net (expenditure) for the
year before transfers
and gains on
investments
Net gains on investment
assets
7
Net (expenditure)
income and net
movement in funds
Reconciliation of funds:
Total fund balances
brought forward at 1
August
. As previously stated
. Prior year adjustment
(note 18)
. As restated
Total fund balances
carried forward at 31
**July **		 1,320
69,100		 26,851
216,192		 —
—		 28,171
285,292		 87,571
400,691
70,420 243,043 — 313,463 488,262
39,964
994,137		 134,260
553,666		 —
—		 174,224
1,547,803		 174,050
1,281,580
1,034,101 687,926 — 1,722,027 1,455,630
(963,681)
101,400		 (444,883)
219,344		 —
97,902		 (1,408,564)
418,646		 (967,368)
3,101,396
(862,281) (225,539) 97,902 (989,918) 2,134,028
2,507,289
1,662,761		 10,820,576
(1,797,887)		 4,300,232
135,126		 17,628,097
—		 15,494,069
—
4,170,050 9,022,689 4,435,358 17,628,097 15,494,069
3,307,769 8,797,150 4,533,260 16.638,179
,		 17,628,097

All of the charity’s activities were from continuing operations in the above two financial periods.

The charity has no recognised gains or losses other than those included in the Statement of Financial Activities.

The notes on pages 23 to 31 form an integral part of these financial statements.

The Child Health Research Charitable Incorporated Organisation 15

Statement of financial activities 31 July 2021

Notes Un-
restricted
funds
Restated
£		 Restricted
funds
Restated
£		 Endowment
funds
Restated
£		 Total
funds
2021
Restated
£
Income from:
Donations and legacies
1
Investments
2
Total income
Expenditure on:
Raising funds
3
Charitable activities
. Grants payable
4
Total expenditure
Net (expenditure) for the year before
transfers and gains on investments
Transfers
Net gains on investment assets
7
Net income and net movement
in funds
Reconciliation of funds:
Total fund balances brought forward at
1 August
. As previously stated
. Prior year adjustment (note 18)
. As restated
Total fund balances carried forward at
31 July		 59,141
102,270		 28,430
298,421		 —
—		 87,571
400,691
161,411 326,851 — 488,262
46,194
490,349		 127,856
791,231		 — 174,050
1,281,580
536,543 919,087 — 1,455,630
(375,132)
(124,550)
791,592		 (592,236)
124,550
1,510,333		 —
—
799,471		 (967,368)
—
3,101,396
291,910
2,812,566
1,065,575
3,878,141		 1,042,647
9,044,075
(1,064,033)
7,980,042		 799,471
3,637,429
(1,542)
3,635,887		 2,134,028
15,494,070
—
15,494,070
4,170,050 9,022,689 4,435,358 17,628,097

The Child Health Research Charitable Incorporated Organisation 16

Balance sheet 31 July 2022

Notes
Fixed assets
Investments
7
Current assets
Debtors
8
Cash at bank
Liabilities
Creditors: amounts falling due within one year
9
Net current (liabilities)
Total assets less current liabilities
Creditors: amounts falling due after more than one year
10
Net assets
The funds of the charity:
Unrestricted funds
11
Restricted funds
12
Endowment funds
13
Total charity funds		 2022
£		 2021
Restated
£
18,725,125
23,704
1,080,273		 18,966,273
18,613
1,482,856
1,103,977
(2,138,157)		 1,501,469
(1,738,479)
(1,034,180)
17,690,945
(1,052,766)		 (237,010)
18,729,263
(1,101,166)
16,638,179 17,628,097
3,307,769
8,797,150
4,533,260		 4,170,050
9,022,689
4,435,358
16,638,179 17,628,097

Approved by the Trustees on 15/03/2023 and signed on their behalf by Adrian Clark

Chairman

The notes on pages 23 to 31 form an integral part of these financial statements.

The Child Health Research Charitable Incorporated Organisation 17

Statement of cash flows 31 July 2022

Notes
2022
£		 2021
£
Cash flows from operating activities:
Net cash used in operating activities
A
Cash flows from investing activities:
Investment income
Proceeds from the disposal of investments
Purchase of investments
Net cash provided by investing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at 1 August
B
Cash and cash equivalents at 31 July
B		 (1,347,671) (1,363,940)
285,292
3,881,595
(1,612,867)		 400,691
4,585,538
(3,255,017)
2,554,020 1,731,212
1,206,349

2,113,417		 367,272
1,746,145

3,319,766		 2,113,417

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

A Reconciliation of net movement in funds to net cash (used in) operating activities
2022
£
2021
£
Net movement in funds (as per the statement of financial activities)
(989,918)
2,134,028
Adjustments for:
Gains on investments
(418,646)
(3,101,396)
Investment income
(285,292)
(400,691)
(Increase) in debtors
(5,091)
(18,613)
Increase in creditors
351,276
22,732
Net cash used in operating activities
(1,347,671)
(1,363,940)		 Reconciliation of net movement in funds to net cash (used in) operating activities
2022
£
2021
£
Net movement in funds (as per the statement of financial activities)
(989,918)
2,134,028
Adjustments for:
Gains on investments
(418,646)
(3,101,396)
Investment income
(285,292)
(400,691)
(Increase) in debtors
(5,091)
(18,613)
Increase in creditors
351,276
22,732
Net cash used in operating activities
(1,347,671)
(1,363,940)		 Reconciliation of net movement in funds to net cash (used in) operating activities
2022
£
2021
£
Net movement in funds (as per the statement of financial activities)
(989,918)
2,134,028
Adjustments for:
Gains on investments
(418,646)
(3,101,396)
Investment income
(285,292)
(400,691)
(Increase) in debtors
(5,091)
(18,613)
Increase in creditors
351,276
22,732
Net cash used in operating activities
(1,347,671)
(1,363,940)
Net movement in funds (as per the statement of financial activities)
Adjustments for:
Gains on investments
Investment income
(Increase) in debtors
Increase in creditors
Net cash used in operating activities		 (989,918)
(418,646)
(285,292)
(5,091)
351,276		 2,134,028
(3,101,396)
(400,691)
(18,613)
22,732
(1,347,671) (1,363,940)

B Analysis of cash and cash equivalents

Analysis of cash and cash equivalents
2022
£		 2021
£
Cash at bank and in hand
Cash held by investment managers
Total cash and cash equivalents		 1,080,273
2,239,493		 1,453,724
659,693
3,319,766 2,113,417

The Child Health Research Charitable Incorporated Organisation 18

Principal accounting policies 31 July 2022

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

Basis of preparation

These financial statements have been prepared for the year to 31 July 2022.

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

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

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

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

Critical accounting estimates and areas of judgement

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

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

Assessment of going concern

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

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. The most significant areas of judgement that affect items in the financial statements are detailed above. With regard to the next accounting period, the year ending 31 July 2023 the most significant areas that affect the carrying value of the assets held by the charity are the level of investment return and the performance of the investment markets (see the investment policy and the risk management sections of the Trustees’ report for more information).

The Child Health Research Charitable Incorporated Organisation 19

Principal accounting policies 31 July 2022

Assessment of going concern (continued)

The net current liability position on the balance sheet of £950,409 (2021: net current liability of £237,010) is a reflection of the accounting policy that makes full provision for grants when they are committed. However, the charity maintains a strong cash position and has adequate funds to meet these liabilities as they fall due over the duration of the grants.

Income recognition

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

Income comprises donations, investment income and other income.

Donations are recognised when the charity has confirmation of both the amount and settlement date. In the event of donations pledged but not received, the amount is accrued for where the receipt is considered probable. In the event that a donation is subject to conditions that require a level of performance before the charity is entitled to the funds, the income is deferred and not recognised until either those conditions are fully met, or the fulfilment of those conditions is wholly within the control of the charity and it is probable that those conditions will be fulfilled in the reporting period.

Dividends are recognised once the dividend has been declared and notification has been received of the dividend due.

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

Expenditure recognition

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to make a payment to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably.

All expenditure is accounted for on an accruals basis. Expenditure comprises direct costs and support costs. All expenses, including support costs, are allocated or apportioned to the applicable expenditure headings. The classification between activities is as follows:

The Child Health Research Charitable Incorporated Organisation 20

Principal accounting policies 31 July 2022

Expenditure recognition (continued)

Grants payable are included in the statement of financial activities when approved and when the intended recipient has either received the funds or been informed of the decision to make the grant and has satisfied all performance conditions. Grants approved but not paid at the end of the financial year are accrued. Grants where the beneficiary has not been informed or has to fulfil performance conditions before the grant is released are not accrued for but are disclosed as financial commitments in the notes to the financial statements.

The provision of a multi-year grant is recognised at its present value where settlement is due over more than one year from the date of the award, there are no unfulfilled performance conditions under the control of the charity that would permit the charity to avoid making the future payments and settlement is probable.

All expenditure is stated inclusive of irrecoverable VAT.

Fixed asset investments

Listed investments are a form of basic financial instrument and are initially recognised at their transaction value and subsequently measured at their fair value as at the balance sheet date using the closing quoted market price. The charity does not acquire put options, derivatives or other complex financial instruments.

Realised gains (or losses) on investment assets are calculated as the difference between disposal proceeds and their opening carrying value or their purchase value if acquired subsequent to the first day of the financial year. Unrealised gains and losses are calculated as the difference between the fair value at the year end and their carrying value at that date. Realised and unrealised investment gains (or losses) are combined in the statement of financial activities and are credited (or debited) in the year in which they arise.

Debtors

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

Cash at bank and in hand

Cash at bank and in hand represents such accounts and instruments that are available on demand or have a maturity of less than three months from the date of acquisition.

The Child Health Research Charitable Incorporated Organisation 21

Principal accounting policies 31 July 2022

Creditors and provisions

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

Funds

Unrestricted funds are those available for the general purposes of the Charity and their use is set out in the Constitution.

Restricted funds are those funds whose purposes have been restricted by the donor to specific areas of research as set out in note 12.

Endowment funds are those funds whose purposes have been endowed by the donor to a specific area of research and where the capital is not expendable as set out in note 13.

Income from investments, expenditure on administration fees, investment management fees and gains and losses on investments are apportioned to the active restricted and unrestricted funds on the basis of the average value of each fund during the year.

The Child Health Research Charitable Incorporated Organisation 22

Notes to the financial statements 31 July 2022

1 Donations

Donations
2022
£		 2021
£
Donations and legacies
. Unrestricted funds
. Restricted funds		 1,320
26,851		 59,141
28,430
28,171 87,571

2 Investment income

Investment income
2022
£		 2021
Restated
£
Dividends and interest receivable
. Unrestricted funds
. Restricted funds		 69,100
216,192		 102,270
298,421
285,292 400,691

3 Expenditure on raising funds

Expenditure on raising funds
2022
£		 2021
Restated
£
Investment management fees
. Unrestricted funds
. Restricted funds
Administration
. Unrestricted funds
. Restricted funds		 36,207
122,998
3,757
11,262		 40,127
117,085
6,067
10,771
174,224 174,050

The Child Health Research Charitable Incorporated Organisation 23

Notes to the financial statements 31 July 2022

4 Expenditure on charitable activities

Unrestricted funds

Unrestricted funds
2022
£		 2021
Restated
£
Grants payable
. Postgraduate studentships
. Transition Support
. Other
Grants no longer required
Governance costs (note 5)
Total unrestricted funds		 808,774
—
163,846
—
21,517		 539,461
76,057
—
(138,150)
12,981
994,138 490,349

Restricted funds

Restricted funds
2022
£		 2021
Restated
£
Grants payable
. Chair of Developmental Neurobiology
. Chair of Developmental Biology
. Chair of Childhood Epilepsy
. Help a Child to See
. Genetics fund
. Gertrude Marshall Atkins
. Jim Seakins travel
. Chair of Cancer Biology
. Medical Molecular Biology
Total restricted funds		 62,351
—
135,090
59,913
232,000
—
1,000
2,511
60,800		 74,585
147,837
126,327
9,726
189,316
243,440
—
—
—
553,666 791,231
Total funds
1,547,803 1,281,580

The grants included above were all payable to the UCL GOS Institute of Child Health.

5 Governance costs

Governance costs
2022
£		 2021
£
Auditor’s remuneration
. Audit fees – current year
. Non-audit fees
Legal and bank fees		 8,025
2,045
11,447		 8,590
2,280
2,111
21,517 12,981

6 Staff costs and numbers and remuneration of key management personnel

The average number of persons working for the charity during the year was as follows:

2022 2021
Administration(part-time) 3 5

The Child Health Research Charitable Incorporated Organisation 24

Notes to the financial statements 31 July 2022

6 Staff costs and numbers and remuneration of key management personnel (continued)

The aggregate amount of salaries, wages and related costs of employees is comprised as follows:

2022
£		 2021
£
Salaries and wages
Social security costs
Other pension costs		 9,740
1,170
3,665		 12,255
1,256
2,908
14,575 16,419

This is a recharge of salary costs from the UCL GOS Institute of Child Health to the Child Health Research CIO as no staff are actually employed by the Child Health Research CIO.

The key management personnel of the charity in charge of directing and controlling, running and operating the charity on a day to day basis comprise the trustees and the ICH Finance Manager and ICH Executive Officer. The total remuneration (including taxable benefits and employer's pension contributions) of the key management personnel for the year was £14,575 (2021: £13,608).

No trustee received any form of emoluments from the charity during the year (2021: £nil). No trustee has been reimbursed for expenses incurred during the year (2021: £nil).

7 Investments

The investments of the Child Health Research CIO are managed by Veritas Investment Management LLP.

Analysis by type

Analysis by type
2022 2021
Market Market
At cost
£		 value
£		 At cost
£		 value
£
UK – fixed interest
UK – equities
UK – funds
Overseas – equities
Other
Listed investments total
Cash with brokers
Total investments		 2,939,282
7,256,578
256,536
—
184,643		 3,081,023
12,941,945
260,000
—
202,664		 2,760,007
8,696,771
256,536
—
155,649		 3,003,891
14,907,835
268,800
—
155,185
10,637,039
2,239,493		 16,485,632
2,239,493		 11,868,963
659,693		 18,335,711
659,693
12,876,532 18,725,125 12,528,656 18,966,273

Movement in listed investments

Movement in listed investments
2022
£		 2021
£
Balance brought forward
Additions during the year
Opening market value of disposals (proceeds: £3,881,595, realised
gain: £192,899)
Unrealised gains
Balance carried forward		 18,335,711
1,612,867
(3,688,696)
225,750		 16,564,833
3,255,018
(3,992,017)
2,507,877
16,485,632 18,335,711

The Child Health Research Charitable Incorporated Organisation 25

Notes to the financial statements 31 July 2022

8 Debtors

Debtors
2022
£
23,704
23,704		 2021
£
Other debtors 18,613
18,613

9 Creditors: amounts falling due within one year

Creditors: amounts falling due within one year
2022
£
2,099,840
38,317
2,138,157		 2021
£
Grants payable
Other creditors		 1,681,136
57,343
1,738,479

10 Creditors: amounts falling due after more than one year

Creditors: amounts falling due after more than one year
2022
£
1,052,766
1,052,766		 2021
£
Grants payable 1,101,166
1,101,166

11 Unrestricted funds

Balance
as at
1 August
2021
Restated
£		 Income
£		 Expenditure
£		 Gains /
losses
£
101,400
101,400		 Transfers
£		 Balance
as at
31 July
2022
£
Unrestricted funds 4,170,050 70,420 (1,034,101) — 3,307,769
4,170,050 70,420 (1,034,101) — 3,307,769
Balance
as at
1 August
2020
Restated
£		 Income
Restated
£		 Expenditure
Restated
£		 Gains /
losses
Restated
£
791,589
791,589		 Transfers
Restated
£		 Balance
as at
31 July
2021
Restated
£
Unrestricted funds 3,878,141 161,411 (536,541) (124,550) 4,170,050
3,878,141 161,411 (536,541) (124,550) 4,170,050

The Child Health Research Charitable Incorporated Organisation 26

Notes to the financial statements 31 July 2022

12 Restricted funds

12 Restricted funds
Balance
as at
1 August
2021
Restated
£





Donations
£		 Investment
income
£		 Grants
(approved)
released
£		 Other
costs
£		 Transfers
£		 Gains
(losses)
£		 Balance
as at
31 July
2022
£
Help a Child to See
Children’s Eye
Group Travelling
Fellowship (Claude
Worth Fund)
Caring for Kids
Genetics fund
Dermatomyositis
Research
Chair of Childhood
Epilepsy
Simpson-Smith
Travelling
Fellowship
Department of
Paediatric Surgery
Anne Hamilton
Award – Prize
Studentship
Siemens Nuclear
Medical Research
Kidney Research
William Bequest
Simpson-Smith
Memorial
Lectureship
Chair of
Developmental
Biology
Chair of
Developmental
Neurobiology
Gertrude Marshall
Atkins
Jim Seakins Travel
Fund
Chair of Cancer
Biology
Medical Molecular
Biology Fund
John Lipscombe
Memorial Travel
Award
Bill Marshall
Memorial
Fellowship
Roland Levinsky
Studentship
Wheeler
Scholarship
Cystic Fibrosis		 242,777
274,200
70,186
3,831,370
64,208
3,692,420
225,951
103,693
17,743
34,347
43,936
40,894
—
64,579
—
26,822
2,511
60,801
36,520
351
127,226
57,977
4,177		 —
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
26,851
—		 3,955
—
—
69,042
—
67,360
4,199
—
—
—
—
760
—-
67,337
—-
489
—
—
679
7
2,364
—
—		 (59,913)
—
—
(232,000)
—
(135,090)
—
—
—
—
—
—
—
(62,351)
—
(1,000)
(2,511)
(60,801)
—
—
—
—
—		 (2,290)
—
—
(39,973)
—
(38,999)
(2,431)
—
—
—
—
(440)
—
(48,078)
—
(283)
—
—
(393)
(3)
(1,370)
—
—		 —
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—		 5,803
—
—
101,315
—
98,846
6,161
—
—
—
—
1,115
—
911
—
718
—
—
996
9
3,470
—
—		 190,332
274,200
70,186
3,729,754
64,208
3,684,537
233,880
103,693
17,743
34,347
43,936
42,329
—
22,398
—
26,746
—
—
37,802
364
131,690
84,828
4,177
9,022,689 26,851 216,192 (553,666) (134,260) — 219,344 8,797,150

The Child Health Research Charitable Incorporated Organisation 27

Notes to the financial statements 31 July 2022

12 Restricted funds (continued)

The following restricted funds support salary costs of Principal Investigators at the UCL GOS Institute of Child Health:

The following restricted funds support travel, research and subsistence costs for students awarded grants from the CIO:

The following restricted funds support travelling fellowships and memorial lectures where the UCL GOS Institute of Child Health attracts high-quality speakers and researchers to work with the department on a temporary basis:

The Genetics fund is an historic award. Jeans for Genes would perform annual fundraising which was allocated to GOSHCC and then subsequently transferred over to the CIO. There is no new income into this fund as the partnership between Jeans for Genes and GOSH has been dissolved.

Other restricted funds are legacy funds that the CIO intends to engage with original donors (where possible) to see if the money can be used more widely than their intended purpose, for example where the research is no longer being carried out at the UCL GOS Institute for Child Health.

The Child Health Research Charitable Incorporated Organisation 28

Notes to the financial statements 31 July 2022

12 Restricted funds ( continued )

Balance
as at
1 August
2020
Restated
£





Donations
£		 Investment
income
Restated
£		 Grants
(approved)
released
Restated
£		 Other
costs
Restated
£
Transfers
Restated
£		 Gains
(losses)
Restated
£		 Balance
as at
31 July
2021
Restated
£
Help a Child to See
Children’s Eye
Group Travelling
Fellowship (Claude
Worth Fund)
Caring for Kids
Genetics fund

Dermatomyositis
Research
Chair of Childhood
Epilepsy
Simpson-Smith
Travelling
Fellowship
Department of
Paediatric Surgery
Anne Hamilton
Award – Prize
Studentship
Siemens Nuclear
Medical Research
Kidney Research
William Bequest
Simpson-Smith
Memorial
Lectureship
Chair of
Developmental
Biology
Chair of
Developmental
Neurobiology
Gertrude Marshall
Atkins
Jim Seakins Travel
Fund
Chair of Cancer
Biology
Medical Molecular
Biology Fund
John Lipscombe
Memorial Travel
Award
Bill Marshall
Memorial
Fellowship
Roland Levinsky
Studentship
Wheeler
Scholarship
Cystic Fibrosis
205,287
274,200
70,186
3,304,942
64,208
3,102,700
182,871
103,693
17,743
34,347
43,936
33,097
23,288
36,144
243,440
21,708
2,511
49,208
29,556
284
102,969
29,547
4,177		 —
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
28,430
—		 5,694
—
—
91,199
—
86,348
5,195
—
—
—
—
940
—
103,257
—
617
—
1,398
840
8
2,925
—
—		 (9,726)
—
—
(189,316)
—
(126,326)
—
—
—
—
—
—
(147,838)
(74,585)
(243,440)
—
—
—
—
—
—
—
—		 (2,548)
—
—
(81,343)
—
(38,646)
(2,325)
—
—
—
—
(421)
—
15
—
(276)
—
(625)
(375)
(3)
(1,309)
—
—
—

—

—

—

—

—

—

—

—

—

—

—

(124,550)

—

—

—

—

—

—

—

—

—

—		 44,070
—
—
705,888
—
668,344
40,210
—
—
—
—
7,278
—
(252)
—
4,773
—
—
6,499
62
22,641
—
—		 242,777
274,200
70,186
3,831,370
64,208
3,692,420
225,951
103,693
17,743
34,347
43,936
40,894
—
64,579
—
26,822
2,511
60,801
36,520
351
127,226
57,977
4,177
7,980,042 28,430 298,421 (791,231) _(127,856) _ _(124,550) _ 1,510,333 9,022,689

The Child Health Research Charitable Incorporated Organisation 29

Notes to the financial statements 31 July 2022

13 Endowment funds

Endowment funds
2022
Total
£		 2021
Restated
Total
£
Glaxo Wellcome – Chair of Developmental Neurobiology
Balance brought forward 1 August 2021
Realised/unrealised gains
Balance carried forward 31 July2022		 4,435,358
97,902		 3,635,887
799,471
4,533,260 4,435,358

This endowment was established in 1996 to create a new academic unit of Developmental Neurobiology including a Chair of Developmental Neurobiology. Under the terms of the donation the fund is to be held in perpetuity.

14 Analysis of group net assets between funds

Investments
£		 Current
assets
£		 Liabilities
£		 2022
Total
£		 2021
Total
Restated
£
Endowment funds
Restricted funds
General funds		 4,533,260
10,620,427
3,571,438		 —
—
1,103,977		 —
(1,823,277)
(1,367,646)		 4,533,260
8,797,150
3,307,769		 4,435,358
9,022,689
4,170,050
18,725,125 1,103,977 (3,190,923) 16,971,951 17,628,097
Investments
Restated		 Current
assets
Restated
£		 Liabilities
Restated
£		 2021
Total
Restated
£		 2020
Total
Restated
£
£
Endowment funds
Restricted funds
General funds		 4,435,358
9,937,126
4,593,789		 —
—
1,501,469		 —
(914,437)
(1,925,208)		 4,435,358
9,022,689
4,170,050		 3,878,141
7,980,042
3,635,887
18,966,273 1,501,469 _(2,839,645) _ 17,628,097 15,494,070

The total unrealised gains as at 31 July 2022 constitutes movements on revaluation and are as follows:

2022
£
5,848,594
5,848,594
6,437,617
(814,773)
5,622,844
225,750
5,848,594		 2021
£
£
Unrealised gains included above:
On investments
Total unrealised gains at 31 July
Reconciliation of movements in unrealised gains
Unrealised gains at 1 August
Less: in respect to disposals in the year
Add: net gains arising on revaluation arising in the year
Total unrealisedgains at 31 July		 6,437,617
6,437,617
4,665,675
(735,935)
3,929,740
2,507,877
6,437,617

The Child Health Research Charitable Incorporated Organisation 30

Notes to the financial statements 31 July 2022

15 Connected charities

Some of the Trustees of the Charity are also Trustees of the following organisation:

UCL GOS Institute of Child Health – An Institute of University College London (UCL). Its primary objective is the provision of education and medical research.

In addition, these charities share common administrative facilities and hence involve cross charges of expenditure.

16 Taxation

The Child Health Research Charitable Incorporated Organisation is a registered charity and is exempt under Part 11 of the Corporation Tax Act 2010 on its income and S256 Taxation of Chargeable Gains Act 1992 on its capital gains.

The Trust is not registered for VAT and the expenditure includes VAT where applicable.

17 Related parties

Professor Andrew Copp, who is a Trustee of the Charity, has a portion of his salary at the UCL GOS Institute of Child Health funded by the Chair of Developmental Neurobiology (Glaxo Wellcome) endowment fund (note 14).

18 Prior year adjustment

Reconciliation of reported funds
Total funds as 1 August 2020
(as previously stated)
Prior year adjustment
. Reclassification of income and
expenditure
Total funds at 1 August 2020
(as restated)
Movement in the year to 31 July 2021
. As previously stated
. Reclassification of income and
expenditure
. As restated
Total funds as at 31 July 2021
(as restated)		 Unrestricted
Funds
£
2,812,566
1,065,575
3,878,141
(305,277)
597,186
291,909
4,170,050		 Restricted
funds
£
9,044,075
(1,064,033)
7,980,042
1,776,502
(733,854)
1,042,688
9,022,050		 Endowment
funds
£
3,637,429
(1,542)
3,635,887
662,803
136,668
799,471
4,435,358		 Total
funds
£
15,494,070
—
15,494,070
2,134,028
—
2,134,028
17,628,097

The above prior year adjustment reflects a detailed analysis of grants payable that were previously classified as unrestricted. The analysis identified that a certain number of the grants met the requirements of restricted funds. A prior year adjustment has been made to reflect this. The apportionment of investment management fees, investment income and unrealised and realised gains/loss has also been reallocated as they are apportioned between the funds based on an average of the opening and closing balances.

The Child Health Research Charitable Incorporated Organisation 31