Passage Housing Services Financial Statements Year Ended 31 March 2021
Regulator of Social Housing registration number:4842 Company registration number: 09337431 Charity registration number: 1161696
Passage Housing Services
Contents
Year Ended 31 March 2021
| Contents | |
|---|---|
| Page | |
| Passage Housing Services Information | 3 |
| Board Report | 4 |
| Independent Auditor’s Report | 7 |
| Statement of Comprehensive Income | 10 |
| Balance Sheet | 11 |
| Statement of Changes in Reserves | 12 |
| Statement of Cash Flows | 13 |
| Notes to the Financial Statements | 14 |
Passage Housing Services
Passage Housing Services Information
Year Ended 31 March 2021
| Year Ended 31 March 2021 | |
|---|---|
| Regulator of Social Housing registration number | 4842 |
| Company number | 09337431 (England and Wales) |
| Charity number | 1161696 |
| Directors of the board | Jane Campbell (appointed March 2021) Jonathan Fewster Mark Fisher Michael Kelly Kiran Pawar Christopher Williams |
| Secretary | Jane Sandeman |
| Registered office | St Vincents Centre Carlisle Place London London SW1P 1NL United Kingdom |
| Place of business | As above |
| Auditor | Sayer Vincent LLP Invicta House, 108-114 Golden Lane London, EC1Y 0TL |
| Solicitor | Pothecary Witham Weld 70 St George's Square London SW1V 3RD |
| Bankers | HSBC plc Belgravia Branch The Peak 333 Vauxhall Bridge Road London SWIV 1EJ |
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Passage Housing Services
Board Report
Year Ended 31 March 2021
The board of Passage Housing Services presents their report and the audited financial statements of Passage Housing Services for the year ended 31 March 2021.
Directors of the board
The directors of the board who have served during the year were as follows:
Jane Campbell (appointed 16 March 2021) Jonathan Fewster Mark Fisher Michael Kelly Kiran Pawar Christopher Williams
Review of the business / business model
Passage Housing Services (PHS) is a Private Limited Company incorporated on the 2nd December 2014, Company No. 09337431. It is a wholly owned subsidiary of Passage 2000, a charity and company limited by guarantee whose objective is to end street homelessness. It is a registered charity, No. 1161696 and a Registered Social Landlord RP Number: 4842.
Until 16 December 2020 Passage Housing Services was dormant. On 17 December 2020 it took over a lease from Optivo for Bentley House, a building with 20 units of self contained accommodation, located at St Vincent’s Centre, Carlisle Place, London SW1P 1NL. The freehold of this property is owned by Passage 2000. On 16 March 2021, Passage Housing Services Limited took over a lease from Peabody Housing Association for Passage House, a 40 unit hostel, located at 1-5 Longmoore, London SW1V. Passage 2000 owns the freehold to this property.
Objectives and strategies for achieving those objectives
Bentley House is currently undergoing a major refurbishment, and all units are currently vacant. Once completed, it will provide 19 units of accommodation for vulnerable people. Its three-year strategy for 202225 will be aligned with the strategic priorities of Passage 2000 for the same period.
The principal income in the year was a grant from the parent charity Passage 2000 to support the administrative costs of the entity.
The entity held reserves of £18,842 at the year end. The parent charity, Passage 2000 will continue to support Passage Housing Services to enable to carry out its activities.
Principal risks and uncertainties
A major risk in the redevelopment of Bentley House is the failure to find adequate capital funding. This has been mitigated by having a capital funding plan in place, which includes a mixture of planned grants and a commercial loan, as well as a grant from the reserves of the parent charity Passage 2000. A lesser but still important risk that has been recognised is the possibility that the final build does not meet user requirements. This is being mitigated by a formal process of regular engagement between key service delivery personnel and the Project Manager and Architects. The risk that the cost of the build exceeding budget, seen as moderate, is being managed by the appointment of a cost consultant and regular meetings between the Project Manager and the Chief Operating Officer of the parent charity to review performance against both budget and contract.
Main trends and factors underlying the development and performance and position of the RP Future performance of the RP is predicated upon the successful completion of the current refurbishment of 60 units of accommodation to a high standard. Principal risks to this outcome are noted elsewhere in this report.
Future prospects
After completion of the refurbishment and as the units come into use, Passage Housing Services will, in partnership with Passage 2000, explore strategic partnerships with Housing Associations with regard to establishing more accommodation options for those impacted by homelessness.
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Passage Housing Services
Board Report
Year Ended 31 March 2021
Assessment of how the RP is achieving Value for Money
The funding plan for the refurbishment of Bentley House is designed to achieve a level of ongoing sustainability once the initial investment is realised and the accommodation is in occupation.
Code of governance
Passage Housing Services has adopted the National Housing Federation Code of Governance 2020.
Board’s annual review of internal control
At each meeting of the Board a review of significant risks is undertaken and mitigation strategies agreed.
Public benefit statement
In conjunction with its parent entity Passage 2000, Passage Housing Services seeks to provide resources which encourage, inspire and challenge homeless people to transform their lives. The principal focus of Passage Housing Services Is to provide accommodation for vulnerable people as a significant means to the ending of street homelessness.
Future developments
The principal focus in the immediate future is the successful completion of the refurbishment of the properties mentioned above. Future strategic partnerships will be built on, and depend upon, a positive outcome here. As a result the Directors maintain a careful watch over the risks and uncertainties associated with this project to ensure that future developments are built on a firm foundation.
Employees
During the year the average number of employees was 0 (2020: 0).
Directors’ responsibilities
The Board is responsible for preparing the report and financial statements in accordance with applicable law and regulations.
The Co-operative and Community Benefit Societies Act 2014 and registered social housing legislation require the Board to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the association and of the income and expenditure of the association for that period. In preparing these financial statements, the Board is required to:
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select suitable accounting policies and then apply them consistently;
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make judgements and estimates that are reasonable and prudent;
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state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the association will continue in business.
The Board is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the association and to enable it to ensure that the financial statements comply with the Co-operative and Community Benefit Societies Act 2014, the Housing and Regeneration Act 2008 and the Accounting Direction for private registered providers of social housing in England 2019. It has general responsibility for taking reasonable steps to safeguard the assets of the club and to prevent and detect fraud and other irregularities.
The Board is responsible for the maintenance and integrity of the corporate and financial information included on the association's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Disclosure of information to the auditors
We, the directors of the company who held office at the date of approval of these Financial Statements as set out above each confirm, so far as we are aware, that:
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Passage Housing Services
Board Report
Year Ended 31 March 2021
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there is no relevant audit information of which the company’s auditors are unaware; and
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we have taken all the steps that we ought to have taken as directors in order to make ourselves aware of any relevant audit information and to establish that the company’s auditors are aware of that information.
The board report has been prepared in accordance with the special provisions applicable to companies subject to the small companies' regime.
The financial statements were approved by the board on 15 September 2021 and signed on their behalf by
Kiran Pawar, Director
Michael Kelly, Director
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Passage Housing Services
Independent Auditor’s Report to the Board of Passage Housing Services
Year Ended 31 March 2021
Independent Auditor’s Report to the Members of Passage Housing Services
Opinion
We have audited the financial statements of Passage Housing Services (the ‘association’) for the year ended 31 March 2021 which comprise the statement o comprehensive income , balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements:
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give a true and fair view of the state of the association’s affairs as at 31 March 2021, and of its income and expenditure for the year then ended;
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have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
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have been prepared in accordance with the requirements of the Co-operative and Community Benefit Societies Act 2014, the Housing and Regeneration Act 2008 and the Accounting Direction for private registered providers of social housing in England 2019.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the association in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the board's 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 association'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 board 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 board report , other than the financial statements and our auditor’s report thereon. The board are responsible for the other information contained within the board report. 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.
Matters on which we are required to report by exception
In the light of our 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 board report.
We have nothing to report in respect of the following matters where the Co-operative and Community Benefit Act 2014 requires us to report to you if, in our opinion:
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Passage Housing Services
Independent Auditor’s Report to the Board of Passage Housing Services
Year Ended 31 March 2021
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the association has not kept proper books of account, and not maintained a satisfactory system of control over its transactions, in accordance with the requirements of the legislation; or
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the revenue account, any other accounts to which our report relates, and the balance sheet are not in agreement with the association's books of account; or
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we have not obtained all the information and explanations necessary for the purposes our audit; or
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The directors 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 directors’ annual report and from the requirement to prepare a strategic report.
Responsibilities of the board
As explained more fully in the board's responsibilities statement set out on page in the board report, the board is 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 it determines 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 board is responsible for assessing the association’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 board either intends to liquidate the association or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
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We enquired of management and board which included obtaining and reviewing supporting documentation, concerning the association’s policies and procedures relating to:
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Identifying, evaluating, and complying with laws and regulations and whether they were aware of any instances of non-compliance;
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Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected, or alleged fraud;
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The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.
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We inspected the minutes of meetings of those charged with governance.
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We obtained an understanding of the legal and regulatory framework that the assocication operates in, focusing on those laws and regulations that had a material effect on the financial statements or that had a fundamental effect on the operations of the association from our professional and sector experience.
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We communicated applicable laws and regulations throughout the audit team and remained alert to any indications of non-compliance throughout the audit.
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We reviewed any reports made to regulators.
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We reviewed the financial statement disclosures and tested these to supporting documentation to assess compliance with applicable laws and regulations.
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We performed analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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Passage Housing Services
Independent Auditor’s Report to the Board of Passage Housing Services
Year Ended 31 March 2021
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-andguidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-foraudit.aspx. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the association’s members, as a body, in accordance with section 87 of the Cooperative and Community Benefit Societies Act 2014. Our audit work has been undertaken so that we might state to the association’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 association and the association’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Judith Miller (Senior statutory auditor) 29 September 2021 for and on behalf of Sayer Vincent LLP, Statutory Auditor Invicta House, 108-114 Golden Lane, LONDON, EC1Y 0TL
Sayer Vincent LLP is eligible to act as auditor in terms of section 1212 of the Companies Act 2006
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Passage Housing Services
Statement of Comprehensive Income (Including Income and Expenditure Account)
Year Ended 31 March 2021
| Note Turnover 2 Operating costs Gross surplus Administrative expenditure Operating surplus Surplus for the year before taxation 5 Tax on surplus 7 Surplus for the year Total comprehensive income for the year / period |
2021 £ 25,105 - 25,105 (6,469) 18,636 18,636 - 18,636 18,636 |
2020 £ 150 - |
|---|---|---|
| 150 (36) |
||
| 114 | ||
| 114 | ||
| - | ||
| 114 | ||
| 114 |
All of the above results are derived from continuing activities. There were no other recognised gains or losses other than those stated above. All income is unrestricted.
Approved by the Directors on 15 September 2021 and signed on their behalf by
Kiran Pawar, Director
Michael Kelly, Director
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Company number: 09337431
Passage Housing Services
Balance sheet
Year Ended 31 March 2021
| Note Fixed assets Tangible fixed assets - housing properties 8 Current assets Cash at bank and in hand Creditors: amounts falling due within one year 9 Net current (liabilities) / assets Total assets less current liabilities Creditors: amounts falling due after more than one year 10 Total net assets Reserves Income and expenditure reserve Total Reserves |
2021 £ 652,935 652,935 25,299 25,299 (69,892) (44,593) 608,342 (589,500) 18,842 18,842 18,842 |
2020 £ - |
|---|---|---|
| - 206 |
||
| 206 - 206 |
||
| 206 - |
||
| 206 | ||
| 206 | ||
| 206 |
These accounts have been prepared in accordance with the special provisions applicable to small companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the Board on 15 September 2021
Signed on behalf of the board
Kiran Pawar, Director
Michael Kelly, Director
The notes to financial statements form part of these accounts.
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Passage Housing Services
Statement of Changes in Reserves
Year Ended 31 March 2021
| Balance as at 1 April 2019 Surplus for the year Total comprehensive income Transfers Balance at 31 March 2020 Surplus for the year Total comprehensive income Balance at 31 March 2021 |
Income and expenditure reserve £ 92 114 |
Total £ 92 114 |
|---|---|---|
| 206 - |
206 - |
|
| 206 18,636 |
206 18,636 |
|
| 18,636 | 18,636 | |
| 18,842 | 18,842 |
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Passage Housing Services
Statement of Cash Flows
Year Ended 31 March 2021
| Note Cash flow from operating activities 12 Net cash flow from operating activities Change in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year Cash and cash equivalents consists of: Cash at bank and in hand Cash and cash equivalents at 31 March 2021 |
2021 £ 25,093 25,093 25,093 206 25,299 25,299 25,299 |
2020 £ 114 |
|---|---|---|
| 114 | ||
| 114 92 |
||
| 206 | ||
| 206 | ||
| 206 |
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
1 Summary of significant accounting policies
(a) General information and basis of preparation
Passage Housing Services (PHS) is a charitable company, limited by guarantee without share capital registered in England and Wales, company registration number 09337431, charity number 1161696. It is also a and a Registered Provider of Social Housing. The registered office is St Vincent's Centre, Carlisle Place, London, London, SW1P 1NL, United Kingdom.
PHS constitutes a public benefit entity as defined by FRS 102.
The financial statements have been prepared in accordance with applicable accounting standards including Financial Reporting Standard 102 The Financial Reporting Standard Applicable in the UK and Republic of Ireland (FRS 102), the Statement of Recommended Practice for Social Housing Providers 2018, and with the Accounting Direction for private registered providers of social housing in England 2019. The financial statements are also prepared under the requirements of the Housing and Regeneration Act 2008 and the Companies Act 2006. The financial statements have been prepared on a going concern basis under the historical cost convention, modified to include certain items at fair value. The financial statements are prepared in sterling, which is the functional currency of PHS, and rounded to the nearest £.
The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.
The management committee does not consider that there are any sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next reporting period.
(b) Going concern
The directors consider that there are no material uncertainties about the company's ability to continue as a going concern. The company has made a surplus for the year and has the commitment of ongoing financial support available from the parent charity should this be required. In light of the Covid-19 pandemic the parent charity has generated significant funding to provide residential accommodation to rough sleepers in Westminster and has sufficient reserves set aside to adapt to the changing landscape the pandemic has created.
(c) Tangible fixed assets
Housing properties
Social housing properties are stated at cost less accumulated depreciation. Fixed assets represents the leasehold property held by the entity and is stated at the cost of the buyback of the lease. The assets is capitalised on the basis that Passage Housing Services holds the risks and rewards of ownership. The Housing property is depreciated over the life of the lease.
(d) Debtors and creditors receivable / payable within one year
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the statement of comprehensive income in other administrative expenses.
(e) Turnover and other income
Turnover represents grants received during the year.
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
1 Summary of significant accounting policies (continued)
(f) Cash at bank and in hand
Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.
(g) Financial instruments
Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
2 Turnover, cost of sales, administrative expenditure and operating surplus
| Activities other than social housing activities: Grant from parent charity Other |
2021 Total £ 25,000 105 25,105 |
2020 Total £ - 150 |
|---|---|---|
| 150 |
3 Particulars of turnover and administrative expenditure
Turnover and administrative expenditure from social housing lettings was nil in 2021 (2020: £0).
4 Accommodation owned, managed and in development
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| Social housing: total owned and managed Net surplus for the year Surplus is stated after charging: Auditor’s remuneration (including expenses and benefits in kind) for audit Depreciation of tangible fixed assets - housing properties |
Number of units 2021 No. 60 60 2021 £ 4,200 2,065 |
Number of units 2020 No. - - |
|---|---|---|
| 2020 £ - - |
Board and key management personnel remuneration
The entity has no employees. The directors of the board are all unpaid, the company had 6 directors at the year end (2020: 5).
Tax
The entity which is a registered charity is exempt from corporation tax as all its income is charitable and is applied for charitable purposes.
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
8 Tangible fixed assets – housing properties
| Cost: At 1 April 2020 Additions: completed properties acquired At 31 March 2021 Depreciation: At 1 April 2020 Charge for year At 31 March 2021 Net book value: At 31 March 2021 At 31 March 2020 |
Social Housing properties for letting £ - 655,000 |
Shared ownership properties £ - - |
Total £ - 655,000 |
|---|---|---|---|
| 655,000 | - | 655,000 | |
| 2,065 | - | - 2,065 |
|
| 2,065 | - | 2,065 | |
| 652,935 | - | 652,935 | |
| - | - | - |
Housing property comprises Bentley House which has been acquired via a lease buyback arrangement.
The full amount is payable to the former leaseholder over a period of ten years.
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
9 Creditors: amounts falling due within one year
| Other creditors Accruals |
2021 2020 £ £ 65,500 - 4,392 - 69,892 - |
|---|---|
Details of leasing arrangements are provided in note 21.
10 Creditors: amounts falling due after more than one year
| Amounts owed to group undertakings Other creditors |
2021 2020 £ £ 65,500 - 524,000 - 589,500 - |
|---|---|
Amounts owed to group undertakings terms of repayment represent the initial payment under the transfer agreement for Bentley House. There is no interest or security related to the creditor.
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
11 Reconciliation of operating surplus to cash flow from operating activities
| Surplus /for the year Depreciation and impairment of tangible fixed assets Increase in trade and other creditors Net cash flow from operating activities |
2021 £ 18,636 2,065 4,392 25,093 |
2020 £ 114 - - |
|---|---|---|
| 114 |
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Passage Housing Services
Notes to the Financial Statements
Year Ended 31 March 2021
12 Ultimate controlling party
The parent company of Passage Housing Services is Passage 2000 (operating as The Passage), Company no. 03885593, Charity no. 1079764.
PHS is consolidated in the group financial statements of The Passage, and the group accounts are available to the public from:
The Passage, St Vincent's Centre, Carlisle Place, London, SW1P 1NL.
13 Related party transaction
A grant of £25,000 was received from the parent entity Passage 2000 to support the administrative costs of the entity (2020: £nil).
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