Registered charity number 1163560 in England & Wales and SC046098 for Scotland
06/08/2021
KFC FOUNDATION
REPORT & FINANCIAL STATEMENTS
PERIOD ENDED
27 DECEMBER 2020
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KFC FOUNDATION
Contents
Period from 30 December 2019 to 27 December 2020
| CONTENTS | PAGE |
|---|---|
| Officers and Professional Advisors | 3 |
| Statement from Chair of Trustees | 4 |
| Trustees Report |
5 |
| Independent Auditor s Report |
13 |
| Statement of Financial Activities | 17 |
| Statement of Financial Position | 18 |
| Statement of Cash Flows | 19 |
| Notes to the Financial Statements | 20 |
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KFC FOUNDATION
Officers and Professional Advisors
Period from 30 December 2019 to 27 December 2020
Legal & Foundation Information
| Trustees | Simon Coates (from 12thMay 2020) |
|---|---|
| Meghan Farren | |
| James Fletcher | |
| Akram Khan | |
| Paula Jane Mackenzie (Chair) | |
| Neil Morrison | |
| Nick Newman (from 28thJuly 2020) | |
| Alvin Owusu (from 2ndNovember 2020) | |
| Catherine Stamper (resigned 15thMay 2020) | |
| Jennie Wright | |
| Secretary | Louise Norris |
| Registered Office | Orion Gate, Guildford Road, Woking, GU22 7NJ |
| Functional Team | Alan Johnson |
| Anastasia Miller | |
| Julian Thomas (Gift Aid Secretary) | |
| Louise Norris | |
| Advisors | |
| Principal Bankers | National Westminster Bank PLC |
| 23 Brunswick Place | |
| Brunswick Gate | |
| S015 2AQ | |
| Solicitors | BDB Pitmans |
| 50 Broadway | |
| London | |
| SW1H 0BL | |
| Auditor | Buzzacott LLP |
| 130 Wood Street | |
| London | |
| EC2V 6DL |
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KFC FOUNDATION
Statement from our Chair of Trustees
Period from 30 December 2019 to 27 December 2020
The KFC Foundation has a mission to empower young people across the UK to fulfil their potential. Through the exceptional work of KFC team members, the incredible generosity of our communities and the inspirational work of our partner organisations we have been able to help support thousands of young people.
It would be remiss of me to continue without acknowledging the impact that the Covid 19 pandemic has had on both the Foundation and the organisations who receive Foundation grants and their service users. Many of the organisations that we supported in 2020 saw an almost immediate cessation in their income due to the restrictions on their ability to fundraise which came, oftentimes, hand in hand with a significant increase in demand for their services. Many of their service users have had increased challenges with their mental health, food insecurity and isolation to name a few.
I would like to take this opportunity to thank the teams and individuals that have enabled the Foundation to continue making an impact. The first of these acknowledgements must of course go to our partner organisations up and down the UK. Despite the challenging environment, it has been humbling and inspiring to hear, through their agility, resilience and tenacity how they have continued to deliver vital services to the young people in their communities.
Secondly the team members working in KFC restaurants and head offices across the UK, in what has also been a challenging year for many of them. Without the dedication and enthusiasm of the KFC teams we could never deliver the phenomenal grants that we do. There are many stories of individual teams who have gone to amazing lengths to support the Foundation. It is the hard work of these dedicated teams which underpins everything that you will see in this report.
Finally, we thank the communities who have donated so generously this year, it is the kindness of our guests which enables the KFC Foundation to support so many vulnerable young people. Time and time again our guests have demonstrated just how big their hearts are.
As Chair of Trustees it is with pride that I report that we have moved the Foundation to be a small community grant making Foundation. Harnessing the power of local and supporting grass root organisations in the heart of the communities that KFC UK&I operate in. These organisations work for the benefit of the community, creating a positive impact, working with tireless diligence and professionalism. Through these organisations the KFC Foundation is able to offer support for young people living in the toughest circumstances, providing positive activities for them to take part in, mentoring for the most vulnerable and in many cases the chance to make steps into employment, education, training or volunteering. And in this, perhaps the most challenging of years, tackling some of the most basic physiological needs such as food insecurity.
In addition to our small community grant programme we continue our partnership with Comic Relief, who share our values and have been supporting organisations in the UK to bring about social change for over thirty years. We are working with them to fund several organi £3m over the next four years.
I would also like to take the opportunity to thank the existing Trustees for their contribution to the Board. They are fully committed to helping young people fulfil their potential through the activities of the Foundation and its partner organisations. Cath Stamper took the decision to step down in May and I would like to extend my thanks for her contribution. In combination with the resignation of Huw James in late 2019, there were vacancies left on our Board so we were thrilled to welcome Simon Coates, KFC Franchisee; Nichola Newman, former charity CEO, fundraiser and currently a charity consultant who brings expertise in charity governance, fundraising and grant making; Alvin Owusu, recent graduate who runs his own social enterprise and works for Children in Need, to help us on the journey of ensuring our beneficiaries are represented at a board level. All three bring a passion for the purpose of the Foundation and in their short time have been able to add huge value, I welcome them to the Board and thank them for joining us.
Thank you to everyone who has been involved; we have been inspired by the work of our teams, communities and partner organisations and are facing the next year determined to continue making a difference.
Paula Mackenzie Chair of Trustees
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
The Trustees present their Annual Report and Accounts for the period ended 27[th ] December 2020. In preparing this report and accounts the Trustees have complied with the Charities Act 2011, the and Accounting and Reporting by Charities: Statement of Recommended Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
The KFC Foundation is registered with the Charity Commission in England and Wales (number 1163560) and the OSCR in Scotland (number SC046098). Legal and other information relating to the Foundation set out above lists the Trustees and principal advisors of the Foundation and forms part of this report.
Structure, Governance & Management
Organisational Structure
The Foundation is constituted as a Charitable Incorporated Organisation and, therefore is governed by a Constitution and has no share capital.
Governance
All Trustees named on page 3 served through the period unless otherwise stated. The Trustees have been chosen for their commercial, community, lived experience and charitable expertise, as well as their commitment to the aims and philosophy of the Foundation.
new Trustees are aware of their duties to further the purposes of the Foundation, to ensure that the Foundation carries out its purposes for the public benefit and to act in the best interests of the Foundation by ensuring that resources are responsibly managed. The Trustees are senior leaders in Kentucky Fried Chicken (Great Britain) unity and externals with charitable experience and thus have the appropriate skills and diligence to be acting as Trustees of the Foundation. In 2020 we also took the decision to appoint a Trustee to represent the voice of our beneficiaries.
New Trustees a Annual Report and statement of accounts upon a Trustee training course.
Management
The key management of the Foundation comprise the Trustees and 1 employee of KFC whose salary is recharged to the Foundation in charge of directing and controlling, running and operating the charity.
The day-to-day operation of the Foundation is carried out by the Functional Team (Louise Norris, Anastasia Miller Alan Johnson and Julian Thomas). All four are employees of KFC, Anastasia, Alan and Julian gift their time and expertise to the Foundation (and are therefore not remunerated from Foundation funds), as such between Anastasia and Alan they have volunteered approximately 70 hours and Julian 12 hours during the period of this report. recharged to the Foundation.
the payment of grants from Foundation funds and Julian Thomas is our Gift Aid Secretary.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
Other employees of KFC also gift their time and expertise to the Foundation where necessary for example for social media, marketing and digital ventures.
Louise Norris manages the F planning and activating fundraising mechanisms, grant making, communication, strategic direction and the day to day running of the Foundation including regulation and compliance.
Objectives & Activities
The principal objects for which the Foundation was established are such charitable purposes for the public benefit as are exclusively charitable according to the laws of England and Wales as the Trustees may from time to time determine with a particular emphasis on advancing in life and relieving the needs of young people.
A summary of the activities that the Foundation has carried out in pursuance of its principal objectives can be found below.
Mission & Vision
The KFC Foundation vision is to create a world in which every young person is empowered to challenge the barriers to aspiration and fulfil their potential to become leaders of the future. And our mission it to empower young people in the UK to fulfil their potential and build a positive future by providing spaces that allow young people to feel safe and secure, helping them to unlock talent, build life skills, provide mentoring and improve their chances to gain meaningful employment. Both have been inspired by the founder of KFC, Colonel Sanders.
The KFC Foundation makes grants to support organisations in the heart of the community who provide spaces that allow young people to feel safe and secure, helping them to unlock talent, build life skills, provide mentoring and improve their chances to gain meaningful employment. This aligns strongly with our business values, expertise and team member and guest demographics.
In May 2020 the Foundation concluded its partnerships with the regional charities that it had been working with for the last 2 years, to move to a more hyper local focussed community grant making programme. The projects that the Foundation makes grants to support work, in many cases, with the most vulnerable young people in their community. They share our passion for empowering young people to help them reach their full potential. Through its new community grant programme the Foundation was able to support numerous projects and young people in 2020.
Achievements & Performance
How you gave your support in 2020
Our total net income in 2019-2020 was: £869,239
This was made up of:
Countertop donation boxes: £99,085 Product donations: £608,298 Kiosk Donations: £143,291 Ad hoc donations: £18,565
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
How we used the money you gave in 2020
The Foundation made grants to the following charities in the amounts set out below (expressed as a percentage of the total sum raised during 2019-20):
| 2019 - 2020 | 2019 - 2020 | 2018 - 2019 | ||
|---|---|---|---|---|
| Amount | Amount | |||
| Charity Name and Charity Number | Donated | Percentage | Donated Percentage | |
| Kids Inspire Essex (1129513) |
£5,000 | 0.9% | £22,948 | 3.3% |
| Childhood Trust (1154032) | £6,500 | 1.1% | £13,261 | 1.9% |
| Focus Charity (1068467) | £5,000 | 0.9% | £19,440 | 2.8% |
| Mentoring Plus (1112534) | £5,000 | 0.9% | £26,308 | 3.8% |
| London Youth Support (1086850) | £5,000 | 0.9% | £13,261 | 1,9% |
| Young Lives Foundation (1119528) | £5,000 | 0.9% | £35,124 | 5.0% |
| Boys & Girls Club (1009142) | £5,000 | 0.9% | £12,817 | 1.8% |
| Positive Futures (1145598) | £5,000 | 0.9% | £10,231 | 1,5% |
| Young People First (1056035) | £6,000 | 1.0% | £25,003 | 3,6% |
| GMYN (1151897) | £5,000 | 0.9% | £27,645 | 3,9% |
| Action4Youth (1033626) | £5,000 | 0.9% | £23,610 | 3.4% |
| Workingrite CIC (SC042604) | £6,500 | 1.1% | £21,126 | 3,0% |
| Youth Association (519883) | £5,000 | 0.9% | £25,016 | 3,6% |
| Keyfund Federation (1093569) | £5,000 | 0.9% | £11,512 | 1,6% |
| Include Youth (103383) | £5,000 | 0.9% | £12,695 | 1,8% |
| Other Grants £2,000 and under | £44,589 | 7.6% | - | - |
| Comic Relief (325658 & SCO39730) | £459,350 | 78.8% | £400,000 | 57.1% |
What we did in 2020
Despite being a tough year in the sector the Foundation still had a busy one. As noted in the Chair s report we continue to review governance and capability of the Trustee Board. As a result of 2 Trustees resigning we identified the need to backfill a representative of the KFC Franchise Community and a Trustee who would bring experience serving on a board of a charity, charity foundation or working closely with a charity board and excellent, up to date knowledge of best practice and governance of the charity sector. To that end we were thrilled to appoint Simon Coates and Nichola Newman. Through the recruitment process we had our eyes opened and were inspired to commence a journey of having the voice of our beneficiaries represented at a board level, to that end we were also thrilled to appoint Alvin Owusu.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
Community Grant Making
In a landscape where, as a result of the pandemic youth unemployment is at 14.3% and 83% of young people are reporting worsened mental health as a result of the lockdowns we turned our attention to grant making. We ended our 2-year partnerships in May 2020 with a conservative grant to all 15 charities. We are pleased to say we were able to review this again in early 2021 and make an additional final grant to each recipient charity as 2020 did not prove as detrimental from an income perspective as we had first forecast.
In the early part of the year, ahead of the pandemic we ran our now annual raffle at the KFC Restaurant Support Centre to raffle gifts received by employees from suppliers that exceed the gifts policy, raising £951.00. For the first time we also ran a raffle at KFC opportunity to bring items of use to our charity partners to donate (toiletries, games, stationery etc) both mechanics were well received.
In Autumn we launched the first grant funding call for our hyper-local community grant making programme,
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Young people aged 11-25 years old
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Those in a position of social disadvantage
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Organisations which empower young people to fulfil their potential and build a positive future Organisations with an annual income of no more than £300,000, operating in the heart of our communities
Making grants of up to £2,000.
We received 372 grant applications during the first funding call and shortlisted 141 of those applications of which 30 were successfully awarded, the ambition is to grow the programme to support an organisation in every community that KFC is represented in.
Comic Relief Partnership
We continued our partnership with Comic Relief that commenced in 2019 but with the onset of Covid we reviewed our commitment to them and in the partnership agreement with them agreed to spread our £3m commitment over 4 years instead of the originally agreed 3 years to March 2023, offering us the benefit of an additional Red Nose Day campaign to activate against.
We began preparations for the 2021 Red Nose Day campaign which spanned across a variety of platforms; radio, restaurant assets, merchandise, social media etc.
Fundraising
On 23[rd] March 2020 the UK went into National Lockdown as a result of the coronavirus (Covid-19) outbreak which had spread worldwide and caused extensive disruption to businesses as well as economic activities globally. All non-essential businesses were forced to closed, as such all KFC restaurants were closed for a minimum of 2 weeks and Foundation income was switched off overnight. Various degrees of Lockdowns have continued throughout 2020 and 2021 also affecting restaurants in varying degrees. KFC have seen an almost wholesale move to digital payment; we saw the already declining use of charity cash boxes reduce further (62% decline v. prior year). Kiosk payments also suffered a significant level of decline (35% decline v. forecast) as even with restaurants being able to reopen for takeaway many guests preferred to use the drive through or delivery channels available rather than be in restaurant. One upside came through the increased use of delivery channels and the increased purchase of the Sharing Buckets which has the restricted 5p donation to Comic Relief associated with it (17.4% increase v. prior year).
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
At the time of writing the annual report last year we had predicted a 35% decline in income and we are pleased to report that we in fact closed the year with a 25% decrease in income.
Following the advice issued by the UK Government in March 2020 employees continue working from home and we have enacted procedures to facilitate this including support functions such as finance and administration to
In addition to making grants and donations the Foundation is keen to build partnerships with the organisations it supports by offering volunteering opportunities to KFC Teams. Another significant downside of Covid has been the inability to offer the opportunity to engage with charity partners through summer events and cooking Christmas dinner which had been growing in popularity. It was obviously impossible for these events to occur but KFC Teams did donate approximately 110 hours to supporting with the shortlisting process of the grant making.
Impact
We are extremely proud of the impact that the Foundation is making across the UK with its partner organisations, here are just a few examples of what they have to say about the grants the Foundation has provided.
vulnerable young people over the Covid 19 health crisis. Activities have included purchasing laptops and tablets Andrew Armstrong Partnership Coordinator Include Youth.
Our Wigzee Woo project was also partly funded by the KFC Foundation funding. This project was running on a weekly basis and gave young people who wished to be involved the chance to design and make headpieces for children who may have lost their hair due to medical problems. Wigzee Woo is a charity centred on crocheting Operations Manager Positive Futures
And some feedback from some of the projects from our community grants programme who are just coming to the end of their projects: - not just the grant but also products donated by KFC partners which have been amazing esp. the mental health ki
delivering the programme and despite its success, we now know what to expect and how to make it more impactful True Cadence CIC
The Foundation has met some of its objectives for 2020; it has continued to improve its governance and capability, it reached a mutually beneficial agreement with Comic Relief in regards to its commitment and it transitioned to a small community grant maker starting its journey to have an impact on each community that KFC serves. We did not reach our fundraising target of £1.16m however under the circumstances we had a more positive end of year outcome than had been anticipated in March 2020.
Public Benefit
The benefits are clearly set out in the Achievements & Performance section above.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
. The beneficiaries are vulnerable young people, primarily from deprived backgrounds who are at risk of dropping out of education, becoming involved in gangs, lack a stable role model, are struggling to find employment and are likely to continue the cycle of poverty. The charities we make grants to seek to mitigate against these by providing safe spaces, mentoring, counselling, training and education.
Financial Review
Statement of Financial Activities
The Foundation is operated on a cash basis. The Foundation pays grants to its charity partners once it has received sufficient sums into its bank account, thus ensuring that the Foundation does not go into deficit. The principal funding sources during the financial period were as follows:
Countertop donation boxes (11%) Product contribution (70%) Kiosk donations (17%) Ad hoc donations (2%)
Assets
The only assets that the Foundation holds are cash and cash equivalents (including receivables), there are no funds held as a custodian trustee on behalf of any others.
Investments
The Foundation does not hold any investments and only keeps money in its NatWest bank account.
Reserves
The foundations reserves are continually reviewed considering latest forecasts to ensure the Foundation can cover costs, committed grants and donations. The statement of financial position shows total funds of £759,352 (2019 - £538,660) of which £482,980 are unrestricted funds (2019 - £420,586). £276,372 are restricted and are not available for the general purposes of the charity (2019 - £118,074).
Plans for the Future
In 2020 the Trustees and senior leadership team at KFC UK&I reached a clear position on the role of the Foundation and how it fits with the Comic Relief partnership. The partnership with Comic Relief continues to be with the KFC Foundation created to drive awareness of the Foundation and its mission among KFC guests, awareness of the Foundation currently stands at 18% among guests. The projects supported through Comic Relief are absolutely in line with the mission of the Foundation, but they are much larger grants to much larger organisations with greater geographical reach.
of communities that KFC serves, helping to make KFC Teams proud to work for KFC. Of the 30 grants that were made in 2020, 27 were within 3 miles of a restaurant. We want to grow this grant programme so we are supporting an organisation in every community that KFC is represented in and are working to understand how we can build a more relational approach with everyone we interact with and with our grantees how can we create symbiotic relationships that make us all more sustainable.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
We are also commencing a journey to empower young people within the Foundation; how we harness the voices community leaders of the future.
We are also taking a number of steps to invest in the resource of the Foundation, we will be recruiting for an entry level administrator who will be representative of our beneficiaries to support with grant making, communications and empowering young people within the Foundation. The Foundation will also be making an investment in headcount in the KFC Marketing Team by subsidising a person to support with the Comic Relief campaign and marketing of the Foundation.
Trustees acknowledge and recognise the potential impact of the Covid-19 pandemic on the future operations of the Foundation, its beneficiaries, partners and stakeholders and our wider society. As Foundation beneficiaries all work with vulnerable young people they have all been allowed to continue to operate face to face in small numbers and with social distancing in place through all subsequent lockdowns, requiring financial support more than ever. Future Lockdowns pose a risk to the Foundation income but we do not anticipate that future Lockdowns will result in the wholesale closure of restaurants as we saw in March 2020. However, should such a circumstance occur the Trustees are able to reduce expenditure in line with the fall in income, it is not anticipated at the current time that the overall financial position of the Foundation will be adversely affected or its financial solvency threatened.
Risk Management
The Trustees have considered the major governance, operation, financial, external and compliance risks which the Foundation faces, and we have processes in place to ensure that those risk are regularly reviewed and mitigating steps taken as necessary. The three risks that would have the highest impact to the operation of the Foundation are a decrease in income (either as a result of having one principle funder or from the pressure of high street sales or as a result of further lockdowns forcing restaurant closures), the reputational risk created by KFC leadership team sitting on the Board of Trustees. We are mitigating against a decrease in income by exploring other fundraising avenues which are less reliant on a donors physical presence in KFC restaurants, we are closely monitoring and forecasting income levels and adapting our expenditure in accordance and we are maintaining close communication with all partners (Comic Relief, partner organisations and franchisees) to manage expectations about commitments. In terms of separation of funds this is something we monitor very closely; we are able to track and report on donations made in every restaurant and we have strict deadlines in place for recovering funds and processes in place to ensure the timely payment of Foundation invoices. Finally, conflict of interest is an inherent risk with members of the KFC Leadership Team sitting on the Foundation board however we have agreed the protocol for the disclosure of potential conflicts, procedures for Trustees standing down on certain decisions and this is documented in our Conflict of Interest policy.
Fundraising Policy
and guests to raise funds through the sale of products or fundraising activities. We do not carry out street fundraising, nor do we undertake fundraising mail shots or telephone canvassing. We work with KFC UK&I to ensure that any fundraising complies with best practice. Fundraising is monitored by the Trustees of the Foundation and we also monitor any fundraising complaints (none were received during the year 2019/20) and we always seek to protect the public, including vulnerable people, from unreasonably intrusive or persistent fundraising approaches or undue pressure to donate.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
statements
Annual Report and the financial statements in accordance with applicable law and regulations. The Trustees have elected to prepare the financial statements in accordance with UK Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.
The financial statements are required by law to give a true and fair view of the state of affairs of the charity and of the income and expenditure for that period.
In preparing these financial statements, generally accepted accounting practice entails that the Trustees:
select suitable accounting policies and then apply them consistently;
make judgements and estimates that are reasonable and prudent;
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state whether applicable UK Accounting Standards and the Statement of Recommended Practice have been followed, subject to any material departures disclosed and explained in the financial statements;
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concern; and
use the going concern basis of accounting unless they either intend to liquidate the charity or to cease operations or have no realistic alternative but to do so.
The Trustees are required to act in accordance with the Constitution of the charity, within the framework of trust law. They are responsible for keeping proper accounting records, sufficient to disclose at any time, with reasonable accuracy, the financial position of the charity at that time, and to enable the Trustees to ensure that, where any statements of accounts are prepared by them under the Charities Act 2011 and the Charities and Trustee Investment (Scotland) Act 2005, those statements of accounts comply with the requirements of regulations under those Acts. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the charity and to prevent and detect fraud and other irregularities.
Provision of information to auditor
So far as each Trustee is aware:
the Trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.
Approval
behalf.
Chair of Trustees
For further information contact: KFC FOUNDATION
Orion Gate, Guildford Road, Woking, GU22
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
Opinion
2020 which comprise the statement of financial activities, the statement of financial position, the statement of cash flows and the notes to the financial statements, including the accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
In our opinion, the financial statements:
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expenditure for the period 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 Charities Act 2011, the Charities and Trustee Investment (Scotland) Act 2005 and regulation 8 of the Charities Financial statements (Scotland) Regulations 2006 (as amended).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable for the audit of the financial statements section of our report. We are independent of the charity in accordance with the 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.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the T 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 going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.
Other information
The Trustees are responsible for the other information. The other information comprises the information included opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, 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 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 financial statements 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 and the Charities Financial statements (Scotland) Regulations 2006 (as amended) requires us to report to you if, in our opinion:
- the information given in the T statements; or sufficient and proper accounting records have not been kept; or the financial statements are not in agreement with the accounting records and returns; or we have not received all the information and explanations we require for our audit.
Responsibilities of Trustees
As explained more fully in the Statement of T Responsibilities, the Trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
In preparing the financial statements, the T 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 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 report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
In identifying and assessing the risks of material misstatement in respect of irregularities including fraud and noncompliance with laws and regulations, our procedures included the following:
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We obtained an understanding of the legal and regulatory frameworks applicable to the charity. We determined that the following laws and regulations were most significant: Charities Act 2011, the Charities and Trustee Investment (Scotland) Act 2005 and regulation 8 of the Charities Financial statements (Scotland) Regulations 2006 (as amended).
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We understood how the charity is complying with these legal and regulatory frameworks by making enquiries to Trustees and those responsible for legal and compliance procedures. Through our enquiries we corroborated these views by our review of T
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fraud might occur. Audit procedures performed by the audit team included:
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Enquiries with management, whether they have any knowledge of any actual, suspected or alleged fraud;
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Challenging assumptions and judgements made by Trustees and management in their significant accounting estimates.
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Identifying and testing journal entries.
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Assessing the extent of compliance with the relevant laws and regulations as part of our procedures.
As a result of our procedures we did not identify any key audit matters relating to irregularities .
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KFC FOUNDATION
Period from 30 December 2019 to 27 December 2020
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 financial statements is located on the Financial site at www.frc.org.uk/auditorsresponsibilities. This description forms part of our
Use of our report
Trustees, as a body, in accordance with section 144 of the Charities Act 2011 and with regulations made under section 154 of that Act and in accordance with Section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and Regulation 10 of the Charities Financial statements (Scotland) Regulat 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 assum
Trustees as a body, for our audit work, for this report, or for the opinions we have formed.
Date: 29 September 2021
Buzzacott LLP Statutory Auditor 130 Wood Street London EC2V 6DL
Buzzacott LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006
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KFC FOUNDATION
Statement of Financial Activities
Period from 30 December 2019 to 27 December 2020
| Notes Income from Donations Counter Top Takings 3 Product Contribution 3 Scratch Cards 3 Kiosk Donation 3 Other Donation 3 Total Income Expenditure on Charitable Activities Donations to Charity Support costs 4 Total Expenditure Net Movement in Funds Reconciliation of Funds: Fund balances at 29 December 2019 Fund balances at 27 December 2020 |
Period from 30 Dec 2019 to 27 Dec 2020 £ Period from 24 Dec 18 to 29 Dec 2019 £ Unrestricted funds Restricted funds Total funds Unrestricted funds Restricted funds Total funds 99,085 - 99,085 257,337 - 257,337 - 608,298 608,298 - 518,074 518,074 - - - 257,626 - 257,626 143,291 - 143,291 64,469 - 64,469 9,215 9,350 18,565 87,224 - 87,224 251,591 617,648 869,239 666,656 518,074 1,184,730 (123,589) (459,350) (582,939) (298,997) (400,000) (698,997) (65,608) - (65,608) (89,489) - (89,489) (189,197) (459,350) (648,547) (388,486) (400,000) (788,486) 62,394 158,298 220,692 278,170 118,074 396,244 420,586 118,074 538,660 142,416 - 142,416 482,980 276,372 759,352 420,586 - 538,660 |
|---|---|
There were no recognised gains or losses in the current or preceding periods other than those disclosed in the statement of financial activities.
The notes on pages 20-25 form part of these financial statements.
17
KFC FOUNDATION
Statement of Financial Position
At 27 December 2020
| Notes Current Assets Cash at bank and in hand Debtors 6 Liability Creditors falling due within one year 7 Net Assets Funds: Restricted Funds 8 Unrestricted General Fund 8 |
27 Dec 2020 £ 684,944 100,704 (26,296) 759,352 276,372 482,980 759,352 |
29 Dec 2019 £ 259,524 315,546 (36,410) |
|---|---|---|
| 538,660 | ||
| 118,074 420,586 |
||
| 538,660 |
and signed on its behalf:
The notes on pages 20-25 form part of these financial statements.
18
KFC FOUNDATION
Statement of Cash Flows
Period from 30 December 2019 to 27 December 2020
| Notes Net cash provided by operating activities 9 Change in cash and cash equivalents in the period Cash at start of the period Cash at end of theperiod |
Total funds 2020 £ 425,420 |
Total funds 2019 £ 179,633 |
|---|---|---|
| 425,420 | 179,633 | |
| 259,524 | 79,891 | |
| 684,944 | 259,524 |
The notes on pages 20-25 The following accounting policies form part of these financial statements.
19
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
1. Accounting Policies
The following accounting policies have been applied consistently in dealing with items that are considered material in relation to the financial statements:
Basis of preparation of financial statements
KFC Foundation is a Charitable Incorporated Organisation registered with the Charity Commission in England and Wales (number 1163560) and with OSCR in Scotland (number SC046098). These financial statements have been prepared for the period from 30 December 2019 to 27 December 2020 with comparative information given in respect to the period from 24 December 2018 to 29 December 2019.
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) (Charities SORP FRS 102), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Charities Act 2011.
The financial statements have been prepared under the historical cost convention.
The KFC Foundation is a public benefit entity.
The financial statements are presented in sterling and are rounded to the nearest pound.
Critical accounting estimates and areas of judgement
Other than the assessment of going concern below, the preparation of the financial statements did not require the Trustees to make any significant judgements or estimates.
Fund accounting
Restricted funds are those to be used in accordance with specific instructions imposed by donors or have been raised by the charity for specific purposes.
Income recognition
Income is recognised when the charity has entitlement to the funds, any performance conditions attached to the income have been met, it is probable that the income will be received and the amount can be measured reliably.
Donated services and facilities
Donated professional services and donated facilities are recognised as income when the charity has control over the item, any conditions associated with the donated item have been met, the receipt of economic benefit from the use by the charity of the item is probable and that economic benefit can be measured reliably. In accordance with Charities SORP (FRS 102), the general volunteer time of KFC GB staff is not recognised.
Expenditure recognition
Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, it is probable that the settlement will be required and the amount of the obligation can be measured reliably. All expenditure is accounted for on an accruals basis.
e activities, as well as administrative costs pertaining to the charity and grant-making. 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 donation and has satisfied all related conditions.
20
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
1. Accounting Policies (continued)
Expenditure recognition (continued)
Grants approved but not paid at the end of the financial period are accrued for. Grants where the beneficiary has not been informed or has to meet certain conditions before the grant is released are not accrued for but are noted as financial commitments in the notes to the financial statements. All grants are made to institutions
Governance costs comprise the costs involving the public accountability of the charity and costs in respect to its compliance with regulation and good practice (including audit costs, bank charges and consultant fees).
Cash at bank and in hand
Cash at bank and in hand includes cash in hand and cash held in the bank current account.
Debtors
Debtors are recognised at the settlement amount, less any provision for non-recoverability.
Creditors
Creditors are recognised when the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and amount due to settle the obligation can be measured or estimated reliably.
Financial instruments
The KFC Foundation only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.
Going concern
Trustees acknowledge and recognise the potential impact of the Covid-19 pandemic on the future operations of the Foundation, its beneficiaries, partners and stakeholders and our wider society. Future Lockdowns pose a risk to the Foundation income but we do not anticipate that future Lockdowns will result in the wholesale closure of restaurants as we saw in March 2020. However, should such a circumstance occur the Trustees are able to reduce expenditure in line with the fall in income, it is not anticipated at the current time that the overall financial position of the Foundation will be adversely affected or its financial solvency threatened.
The Trustees have therefore concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the charity to prepare these financial statements on a going concern basis. The Trustees are of the opinion that the charity will have sufficient resources to meet its liabilities as they fall due.
The financial statements do not include any adjustments that would result from this basis of preparation being inappropriate.
The Trustees consider that they comprise the key management of the charity in charge of directing and controlling, running and operating the charity.
The Trustees all give freely of their time and expertise without any form of remuneration or other benefit in cash or kind. During the year, expenses totalling £48 (2019: £107) were reimbursed to one Trustee (2019: one). There are no other related party transactions that require disclosure in the financial statements (2019: none).
21
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
3 Income
Income has been split into donations by KFC GB Limited
and its franchises as follows
| Unrestricted £ |
Restricted £ |
30 Dec 2019 to 27 Dec 2020 Total £ - - 56,692 551,606 9,052 90,033 10,470 132,822 18,163 401 - 869,239 |
||
|---|---|---|---|---|
| Scratch cards - franchisees of KFC |
- | - | ||
| Scratch cards - KFC | - | - | ||
| KFC - product contribution | - | 56,692 | ||
Franchisees of KFC - product contribution |
- | 551,606 | ||
| KFC counter top donations | 9,052 | - | ||
Franchisees of KFC - counter top donations |
90,033 | - | ||
| KFC - kiosk donations | 10,470 | - | ||
| Franchisees of KF~~C~~ kiosk donations |
132,822 | - | ||
| Other donations | 8,813 |
9,350 | ||
| Pennies for change | 401 |
- | ||
| Gift in kind | - | - | ||
| 251,591 | 617,648 | |||
| Unrestricted £ |
Restricted £ |
24 Dec 2018 to 29 Dec 2019 Total £ 239,913 17,713 47,022 471,052 20,666 236,671 5,563 58,906 58,344 620 28,260 1,184,730 |
||
| Scratch cards - franchisees of KFC |
239,913 | - | ||
| Scratch cards - KFC | 17,713 | - | ||
| KFC - product contribution | - | 47,022 | ||
Franchisees of KFC - product contribution |
- | 471,052 | ||
| KFC counter top donations | 20,666 | - | ||
Franchisees of KFC - counter top donations |
236,671 | - | ||
| KFC - kiosk donations | 5,563 | - | ||
| Franchisees of KF~~C~~ kiosk donations |
58,906 | - | ||
| Other donations | 58,344 |
- | ||
| Pennies for change | 620 |
- | ||
Gift in kind |
28,260 |
- | ||
| 666,656 | 518,074 | |||
22
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
4 Support costs
| upport costs | |||
|---|---|---|---|
| Unrestricted £ |
30 Dec 2019 to 27 Dec 2020 Total £ |
24 Dec 2018 to 29 Dec 2019 Total £ |
|
| Bank charges | 679 | 679 | 630 |
| Consultant fees | 2,830 | 2,830 | 21,244 |
| Audit fees | 10,000 | 10,000 | 10,000 |
| Gift in kind Staff costs Other Expense |
- 44,641 7,458 |
- 44,641 7,458 |
28,260 29,335 - |
| Total support costs | 65,608 | 65,608 | 89,489 |
All support costs related to unrestricted funds in the above periods. Included in support costs are the following governance costs.
| Unrestricted £ |
Unrestricted £ |
Unrestricted £ |
30 Dec 2019 to 27 Dec 2020 Total £ |
30 Dec 2019 to 27 Dec 2020 Total £ |
24 Dec 2018 to 29 Dec 2019 Total £ |
||
|---|---|---|---|---|---|---|---|
| Consultant fees | 1,380 | 1,380 | 9,242 | ||||
| Audit fees | 10,000 | 10,000 | 10,000 | ||||
| 19,242 | |||||||
| Total governance costs | 11,380 | 11,380 | |||||
23
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
5 Salaries & Wages Disclosures
(a) Staff costs
Staff costs during the period were:
| 30 Dec 2019 to 27 Dec 2020 £ |
24 Dec 2018 to 29 Dec 2019 £ |
|
|---|---|---|
| Wages and salaries Social security costs Pension costs |
37,367 3,506 3,768 |
24,467 2,177 2,691 |
| 44,641 | 29,335 |
All staff costs were cross charged from Kentucky Fried Chicken (Great Britain) Limited.
(b) Staff numbers
The average number of persons (including the senior management team) employed during the period ended 27 December 2020 was 1 (2019 - 1).
(c) Higher paid staff
No employees earnt over £60,000 in the period (2019 - none).
(d) Key management personnel
The key management personnel of the Foundation comprise of the Trustees and a KFC employee whose salary is recharged to the foundation. The total amount of employee benefits (including employer pension contributions and employer national insurance contributions) received by key management personnel for their services to the Foundation was £44,641 (2019 - £29,335).
6 Debtors
| KFC GB Ltd Franchises of KFC GB Ltd |
27 Dec 2020 £ 10,847 89,857 100,704 |
29 Dec 2019 £ 9,914 305,632 315,546 |
|---|---|---|
| 7 Creditors | ||
| Audit fees accrual Trade creditors |
27 Dec 2020 £ 18,800 7,496 26,296 |
29 Dec 2019 £ 19,600 16,810 36,410 |
24
KFC FOUNDATION
Notes to the Financial Statements
Period from 30 December 2019 to 27 December 2020
8 Analysis of net assets between funds
| Fund balances at the period end are represented by: Current assets Current liabilities Total net assets |
Fund balances at the period end are represented by: Current assets Current liabilities Total net assets |
Unrestricted General fund £ Restricted funds £ Total funds 27 Dec 2020 £ Unrestricted General fund £ Restricted funds £ Total funds 29 Dec 2019 £ 509,276 276,372 785,648 456,996 118,074 575,070 (26,296) - (26,296) (36,410) - (36,410) 482,980 276,372 759,352 420,586 118,074 538,660 |
|---|---|---|
The restricted funds in 2019 & 2020 relate to income received from product contributions which will be given as donations to Comic Relief.
9 Net cash provided by operating activities
| Net movement in funds Decrease/(increase) in debtors (Decrease)/increase in creditors |
30 Dec 2019 to 27 Dec 2020 £ 220,692 214,842 (10,114) 425,420 |
24 Dec 2018 to 29 Dec 2019 £ 396,244 (243,421) 26,810 179,633 |
|---|---|---|
25