REGISTERED CHARITY NUMBER: 1165540
REPORT OF THE TRUSTEES AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
FOR
THE HEARTH FOUNDATION
Harrison Beale & Owen Limited Chartered Accountants Highdown House 11 Highdown Road Leamington Spa Warwickshire CV31 1XT
THE HEARTH FOUNDATION
CONTENTS OF THE FINANCIAL STATEMENTS for the year ended 5 April 2021
| Page | |||
|---|---|---|---|
| Report of the Trustees | 1 | to | 2 |
| Statement of Trustees Responsibilities | 3 | ||
| Independent Examiner's Report | 4 | ||
| Statement of Financial Activities | 5 | ||
| Balance Sheet | 6 to | 7 | |
| Notes to the Financial Statements | 8 to | 15 | |
| Detailed Statement of Financial Activities | 16 |
THE HEARTH FOUNDATION
REPORT OF THE TRUSTEES for the year ended 5 April 2021
The trustees present their report with the financial statements of the charity for the year ended 5 April 2021. The trustees have adopted the provisions of 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 UK and Republic of Ireland (FRS 102) (effective 1 January 2015).
STRUCTURE, GOVERNANCE AND MANAGEMENT Governing document
The Charity is constituted as a Charitable Incorporated Organisation (CIO) taking the form of a foundation model charity governed by a trust deed. The Charity changed its name by Special Resolution on 6 April 2017 to The Hearth Foundation.
Foundation
The Charity was initially funded with donations in June 2016, which has been invested in a variety of income producing investments, including freehold property, as detailed in the Accounts.
Aims
The object of the Charity as stated in its constitution, is to advance such charitable purposes (according to the law of England and Wales) as the Trustees see fit from time to time.
The income arising from the investments made will be distributed to beneficiaries' subject to retaining a suitable reserve to cover any expenses on the freehold investment properties not recoverable from tenants. It is the intention of the Trustees to make such grants during the first calendar quarter of each year.
The Charity has no specific restrictions as to any beneficiaries, but particular consideration will be given by the Trustees to applications for the benefit of younger people in the Midlands and North of the country. Applications will be considered throughout the year, and distributed as stated above. The Trustees are confident that in exercising their duties, they have full regard to the requirements of the Charity Commission concerning public benefit.
Financial Performance
Bearing in mind the current economic uncertainty arising as a result of the COVID pandemic, the Trustees are pleased with the performance of the various investments made by the Charity during this financial year, and are hopeful that the diversity of these investments will provide a good return in years to come for public benefit. No payment has been made to the Trustees for services or expenses. The only expenses paid by the Charity have been in respect of professional costs and investment advice. Full details of the financial results for the year ended 5 April 2021 are shown in the Accounts.
REFERENCE AND ADMINISTRATIVE DETAILS Registered Charity number
1165540
Registered office
Monkstone House Main Street Mowsley Lutterworth Leicestershire LE17 6NU
THE HEARTH FOUNDATION
REPORT OF THE TRUSTEES for the year ended 5 April 2021
Trustees
M Bosworth Chairman Mrs V M Bosworth C M Bosworth Mrs J P M Bosworth S Bosworth Mrs H E Bosworth
The Trustees do not currently intend to seek further funding for the Charity, and are confident that the present Board have a sufficient range of skills for its operation. Consequently, no further appointments are currently envisaged.
Independent Examiner
Mark Ashfield BA FCA Harrison Beale & Owen Limited Chartered Accountants Highdown House 11 Highdown Road Leamington Spa Warwickshire CV31 1XT
Advisers
Legal
Lodders Solicitors, Stratford-upon-Avon
Property
Harris Lamb Chartered Surveyors, Birmingham
Investment
Brewin Dolphin, Birmingham
Fairstone Financial Management Limited, Kibworth Leicester
Approved by order of the board of trustees on 06 January 2022 and signed on its behalf by:
.......................................................................... M Bosworth - Trustee
THE HEARTH FOUNDATION
STATEMENT OF TRUSTEES RESPONSIBILITIES
for the year ended 5 April 2021
The trustees are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
The law applicable to charities in England and Wales, the Charities Act 2011, the applicable Charity (Accounts and Reports) Regulations and the provisions of the trust deed requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charity for that period. In preparing those financial statements, the trustees are required to
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select suitable accounting policies and then apply them consistently;
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observe the methods and principles in the Charity SORP;
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make judgements and estimates that are reasonable and prudent;
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.
The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charity and to enable them to ensure that the financial statements comply with the Charities Act 2011, the applicable Charity (Accounts and Reports) Regulations and the provisions of the trust deed. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Approved by order of the board of trustees on 06 January 2022 and signed on its behalf by:
............................................. M Bosworth - Trustee
INDEPENDENT EXAMINER'S REPORT TO THE TRUSTEES OF THE HEARTH FOUNDATION for the year ended 5 April 2021
Independent examiner's report to the trustees of The Hearth Foundation ('the charity')
I report to the charity trustees on my examination of the accounts of the charity for the year ended 5 April 2021.
Responsibilities and basis of report
As the charity's trustees you are responsible for the preparation of the accounts in accordance with the requirements of the Charities Act 2011(‘the 2011 act’).
I report in respect of my examination of your charity's accounts as carried out under section 145 of the 2011 Act and in carrying out my examination I have followed the Directions given by the Charity Commission under section 145(5) (b) of the 2011 Act.
Independent examiner's statement
I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe:
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accounting records were not kept in respect of the charity as required by section 130 of the 2011 Act; or
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the accounts do not accord with those records; or
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the accounts do not comply with applicable requirements concerning the form and content of accounts set out in the Charities (Accounts and Reports) Regulations 2008 other than any requirement that the accounts give a ‘true and fair view’ which is not a matter considered as part of an independent examination.
I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached
Mark Ashfield BA FCA Harrison Beale & Owen Limited Chartered Accountants Highdown House 11 Highdown Road Leamington Spa Warwickshire CV31 1XT
Date: 06 January 2022
THE HEARTH FOUNDATION
STATEMENT OF FINANCIAL ACTIVITIES for the year ended 5 April 2021
| Notes INCOME AND ENDOWMENTS FROM Donations and legacies Investment income 3 Other income 4 Total EXPENDITURE ON Raising funds 5 Charitable activities 6 Donations Property fees Other Total Net gains/(losses) on investments NET INCOME/(EXPENDITURE) RECONCILIATION OF FUNDS Total funds brought forward TOTAL FUNDS CARRIED FORWARD |
2021 Unrestricted fund £ - 117,408 (1,675) 115,733 25,775 86,153 522 2,225 114,675 387,749 388,807 2,515,318 2,904,125 |
2020 Total funds £ 30 136,356 44,604 180,990 28,267 88,761 592 2,375 119,995 (294,494) (233,499) 2,748,817 2,515,318 |
|---|---|---|
The notes form part of these financial statements
THE HEARTH FOUNDATION
BALANCE SHEET 5 April 2021
| Notes FIXED ASSETS Investments Investments 13 Investment property 14 CURRENT ASSETS Debtors 15 Cash at bank CREDITORS Amounts falling due within one year 16 NET CURRENT ASSETS TOTAL ASSETS LESS CURRENT LIABILITIES NET ASSETS FUNDS 17 Unrestricted funds TOTAL FUNDS |
2021 Unrestricted fund £ 1,405,141 1,311,859 2,717,000 53,838 165,832 219,670 (32,545) 187,125 2,904,125 2,904,125 2,904,125 2,904,125 |
2020 Total funds £ 1,031,557 1,311,859 2,343,416 30,707 143,973 174,680 (2,778) 171,902 2,515,318 2,515,318 2,515,318 2,515,318 |
|---|---|---|
The notes form part of these financial statements
continued...
THE HEARTH FOUNDATION
BALANCE SHEET - continued 5 April 2021
The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 5 April 2021.
The members have not required the company to obtain an audit of its financial statements for the year ended 5 April 2021 in accordance with Section 476 of the Companies Act 2006.
The trustees acknowledge their responsibilities for
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(a) ensuring that the charitable company keeps accounting records that comply with Sections 386 and 387 of the Companies Act 2006 and
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(b) preparing financial statements which give a true and fair view of the state of affairs of the charitable company as at the end of each financial year and of its surplus or deficit for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the charitable company.
The financial statements were approved by the Board of Trustees and authorised for issue on 06 January 2022 and were signed on its behalf by:
............................................. M Bosworth - Trustee
The notes form part of these financial statements
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS for the year ended 5 April 2021
1. GENERAL INFORMATION
The charity was incorporated under the Charitable Incorporated Organisations (General) Regulations 2012 on 11 February 2016. The charity's registered number and registered office address can be found on the Report of the Trustees.
2. ACCOUNTING POLICIES
Basis of preparing the financial statements
The financial statements of the charity, which is a public benefit entity under FRS 102, have been prepared in accordance with the Charities SORP (FRS 102) '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 UK and Republic of Ireland (FRS 102) (effective 1 January 2015)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Charities Act 2011. The financial statements have been prepared under the historical cost convention with the exception of investments which are included at market value, as modified by the revaluation of certain assets.
Income
All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.
Investment income is recognised on a receivable basis.
Expenditure
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 a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources.
Irrecoverable VAT
There is currently no requirement to restrict any VAT through the VAT returns of The Hearth Foundation as the expenditure it incurs relates wholly to the commercial properties which are all subject to an option to tax and therefore VAT is charged on rents and related service charges.
It is noted that there is a very small amount of exempt income arising from the quarterly service charge invoiced to the occupants of the residential flats which have been sold. It is considered that any VAT incurred in respect of this element would be fully recoverable under the rules for partial exemption.
Grants
Grants offered subject to conditions which have not been met at the year end date are noted as a commitment but not accrued as expenditure.
Allocation and apportionment of costs
Charitable expenditure comprises those costs incurred by the Charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and those costs of an indirect nature necessary to support them.
All costs are allocated between the expenditure categories of the SoFA on a basis designed to reflect the use of the resource. Directly attributable costs are allocated by resource, with the balance of expenditure allocated according to the proportion of trustee involvement with each resource.
Governance costs include those costs associated with meeting the constitutional and statutory requirements of the Charity and include the audit fees and costs linked to the strategic management of the Charity.
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
2. ACCOUNTING POLICIES - continued
Investment property
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in market value is recognised in 'net gains/(losses) on investments' in the SoFA.
Taxation
The charity is exempt from corporation tax on its charitable activities.
Fund accounting
Unrestricted funds can be used in accordance with the charitable objectives.
Investments
Investments are recognised initially at fair value which is normally the transaction price excluding transaction costs. Subsequently, they are measured at fair value with changes recognised in 'net gains/(losses) on investments' in the SoFA if the shares are publicly traded or their fair value can otherwise be measured reliably. Other investments are measured at cost less impairment.
Financial Instruments
Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, they are measured at amortised cost using the effective interest rate method, less impairment.
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 income statement.
Debtors
Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid after taking account of any trade discounts due.
Creditors and provisions
Creditors and provisions are recognised where 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 the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.
3. INVESTMENT INCOME
| Rents received Investment income Deposit account interest |
2021 £ 92,947 24,317 144 117,408 |
2020 £ 96,045 39,771 540 136,356 |
|---|---|---|
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
4. OTHER INCOME
| Profit/(loss) on sale of investment 5. RAISING FUNDS Investment management costs Portfolio management Insurance Maintenance charges |
2021 £ (1,675) 2021 £ 15,661 2,484 7,630 28,105 |
2020 £ 44,604 2020 £ 15,644 2,406 10,217 28,267 |
|---|---|---|
6. CHARITABLE ACTIVITIES COSTS
| Donations Property fees 7. GRANTS PAYABLE Donations |
Grant funding of Direct activities Costs (see note 7) £ £ 3,153 83,000 522 - 3,675 83,000 2021 £ 83,000 |
Totals £ 86,153 522 86,675 |
|---|---|---|
| 2020 £ 86,537 |
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued
for the year ended 5 April 2021
8. SUPPORT COSTS
| 8. | SUPPORT COSTS | ||
|---|---|---|---|
| Governance | |||
| costs | |||
| £ | |||
| Other resources expended | 2,225 | ||
| Support costs, included in the above, are as follows: | |||
| Governance costs | |||
| 2021 | 2020 | ||
| Other | |||
| resources | Total | ||
| expended | activities | ||
| £ | £ | ||
| Accountancy and legal fees | 2,225 | 2,375 | |
| 9. | NET INCOME/(EXPENDITURE) | ||
| Net income/(expenditure) is stated after charging/(crediting): | |||
| 2021 | 2020 | ||
| £ | £ | ||
| Surplus on disposal of fixed assets | 1,675 | (44,604) |
10. TRUSTEES' REMUNERATION AND BENEFITS
There were no trustees' remuneration or other benefits for the year ended 5 April 2021 nor for the year ended 5 April 2020.
Trustees' expenses
There were no trustees' expenses paid for the year ended 5 April 2021 nor for the year ended 5 April 2020.
11. STAFF COSTS
There were no staff costs for the year ended 5 April 2021 nor the year ended 5 April 2020.
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
12. COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES
| INCOME AND ENDOWMENTS FROM Donations and legacies Investment income Other income Total EXPENDITURE ON Raising funds Charitable activities Donations Property fees Other Total Net gains on investments NET INCOME RECONCILIATION OF FUNDS Total funds brought forward TOTAL FUNDS CARRIED FORWARD 13. FIXED ASSET INVESTMENTS MARKET VALUE At 6 April 2020 Additions Disposals Revaluations At 5 April 2021 NET BOOK VALUE At 5 April 2021 At 5 April 2020 |
Unrestricted fund £ 30 136,356 44,604 180,990 28,267 88,761 592 2,375 119,995 (294,494) (233,499) 2,748,817 2,515,318 Listed investments £ 1,031,557 738,567 (752,732) 387,749 1,405,141 1,405,141 1,031,557 |
|
|---|---|---|
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
13. FIXED ASSET INVESTMENTS - continued
Fixed asset investments comprise a portfolio of listed investments and funds managed by Brewin Dolphin and Fairstone Financial Management on behalf of the charity. The funds are valued on a regular basis by the investment managers with reference to current market prices.
14. INVESTMENT PROPERTY
| FAIR VALUE At 6 April 2020 and 5 April 2021 NET BOOK VALUE At 5 April 2021 At 5 April 2020 |
£ 1,311,859 |
|---|---|
| 1,311,859 | |
| 1,311,859 |
The trustees consider the cost of the investment to equate to market value.
15. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
| Trade debtors VAT 16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR VAT Other creditors Accruals and deferred income 17. MOVEMENT IN FUNDS At 6.4.20 £ Unrestricted funds General fund 2,515,318 TOTAL FUNDS 2,515,318 |
2021 £ 52,338 1,500 53,838 2021 £ - 28,962 3,583 32,545 Net movement in funds £ 388,807 388,807 |
2020 £ 30,707 - 30,707 2020 £ 878 - 1,900 2,778 At 5.4.21 £ 2,904,125 2,904,125 |
|---|---|---|
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
17. MOVEMENT IN FUNDS - continued
Net movement in funds, included in the above are as follows:
| Unrestricted funds General fund TOTAL FUNDS |
Incoming resources £ 115,733 115,733 |
Resources expended £ (114,675) (114,675) |
Gains and Movement losses in funds £ £ 387,749 388,807 387,749 388,807 |
|---|---|---|---|
Comparatives for movement in funds
| Unrestricted funds General fund TOTAL FUNDS |
At 6.4.19 £ 2,748,817 2,748,817 |
Net movement in funds £ (233,499) (233,499) |
At 5.4.20 £ 2,515,318 |
|---|---|---|---|
| 2,515,318 |
Comparative net movement in funds, included in the above are as follows:
| Unrestricted funds General fund TOTAL FUNDS |
Incoming resources £ 180,990 180,990 |
Resources expended £ (119,995) (119,995) |
Gains and Movement losses in funds £ £ (294,494) (233,499) (294,494) (233,499) |
|---|---|---|---|
A current year 12 months and prior year 12 months combined position is as follows:
| Unrestricted funds General fund TOTAL FUNDS |
At 6.4.19 £ 2,748,817 2,748,817 |
Net movement in funds £ 155,308 155,308 |
At 5.4.21 £ 2,904,125 |
|---|---|---|---|
| 2,904,125 |
continued...
THE HEARTH FOUNDATION
NOTES TO THE FINANCIAL STATEMENTS - continued for the year ended 5 April 2021
17. MOVEMENT IN FUNDS - continued
A current year 12 months and prior year 12 months combined net movement in funds, included in the above are as follows:
| Unrestricted funds General fund TOTAL FUNDS |
Incoming resources £ 296,723 296,723 |
Resources expended £ (234,670) (234,670) |
Gains and Movement losses in funds £ £ 93,255 155,308 93,255 155,308 |
|---|---|---|---|
18. RELATED PARTY DISCLOSURES
There were no related party transactions for the year ended 5 April 2021.