2020-12-31-accounts

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WORCESTER MUNICIPAL CHARITIES ( CIO )

Registered Charity No.1166931 • Member of the Almshouse Consortium Registered Housing Association No.4855 • Member of the Almshouse Association No.159

Predecessor charities founded 1559 & 1836

TRUSTEES' ANNUAL REPORT 1st JANUARY – 31st DECEMBER 2020

This is the fourth year’s Annual Report of the Charity which was created specifically by the Trustees as the successor Charity for Worcester Municipal Exhibitions Foundation and Worcester Consolidated Municipal Charity in 2016. The Charity is a “Charitable Incorporated Organisation” but has very similar objects to the two unincorporated predecessor charities which it replaced.

The Trustees present their report and the audited financial statements of the Charity for the twelve months’ period ended 31st December 2020 (“The Period”). The Trustees have adopted the provisions of the Statement of Recommended Practice (SORP): "Accounting by Registered Social Housing Providers Update 2018” along with Financial Reporting Standard 102 in preparing the report and financial statements of the Charity.

The financial statements for the Charity have been prepared in accordance with the accounting policies set out in the notes to the accounts and comply with the Statements of Recommended Practice.

Registered Office

All enquiries to:

Worcester Municipal Charities (CIO) Kateryn Heywood House Berkeley Court, The Foregate Worcester WR1 3QG Telephone: [phone] Fax: [phone]

Office Administration:

Maggie Inglis, Sarah Bradnick, Margaret Green Email: [e-mail]

Office Accounts:

Carlo Barentsen, Sarah Bradnick Email: [e-mail]

Website: www.wmcharities.org.uk

Berkeley's Hospital Chapel and Almshouses - Grade 1 Listed Building The Charity's offices, community meeting room, and residents' sheltered housing

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WORCESTER MUNICIPAL CHARITIES ( CIO )

"The Charity"

REPORT FOR THE 12 MONTHS’ PERIOD ENDED 31st DECEMBER 2020 (“The Period”)

For ease of understanding “the Charity” also refers generally to the two predecessor charities in respect of events prior to “The Period”

Item	INDEX	Page
1.	History of the Constitutional Changes leading to the Present Day	4.
2.	The Charitable “Objects” of the Charity and the Charitable “Areas of Beneft”	4.
3.	Constitutional Grant payable under the terms of the Trust Deeds	5.
4.	Administration of the Trustee Body - the Trustees who served in The Period	5.
5.	Composition of the Trustee Body and the Administration	5.
6.	Professional Advisers to the Charity	6.
7.	The Mission Statement, Public Beneft Requirement and Equal Opportunities	6.
8.	A summary of what was achieved during The Period	7.
8.	The Grants Committee	8.
9.	Almshouses - Afordable Housing for the Retired and the Homeless	9.
10.	Grants Awarded in The Period by the Charity	12.
11.	The Grants Committee’s Policies and Practices	13.
12.	Social Investment Programme	14.
13.	Strategic Objectives, Investment Policy & Reviews	18.
14.	The Cost of Administration & Governance	23.
15.	Quinquennial Property Valuations	23.
16.	Property Insurances	23.
17.	Reserves Policy and Financial Risk Assessments	23.
18.	Staf Remuneration	23.
19.	Serious Incidents	23.
20.	Property Portfolio	24.
21.	Conclusion and Comment	25.
22.	Legislation, Policies, Procedures and Practices compliance	27.
23.	Principal Advisers, & Trustees' approval of the Report	28.
24.	Audited Accounts- Worcester Municipal Charities (CIO)	29.

Note – In 2020 the Charity published “While the World Endureth”, a history of the Trust since 1559. Copies are available from the office @ cost price £27, or can be viewed on the website: http://www.wmcharities.org.uk

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1. CONSTITUTIONAL CHANGES LEADING TO THE PRESENT DAY

• a) After Henry VIII dissolved the monasteries (1536 - 40) the new church inspired little confidence and benefactors began leaving money in trust to the local Municipal Corporations instead. Kateryn Heywood, the first such local donor, in her will of 1559, "gave unto the Corporation of Worcester, 100 marks, to be delivered to the Chamber of the said City, to the end that it might be bestowed in lands for the poor people for ever.” Many other local benefactors followed suit, leading to the creation of the St. Thomas’s Day Charities which invested in properties and handed out doles of two shillings from the rental income to a disorderly queue at the Guildhall on the appointed day.

• b) However these corporations comprised self-appointed freemen and aldermen, and widespread concern nationally grew about their ability to manage the charities properly. Charity Commissioners were appointed in the first part of the 19th Century to inspect all the charities throughout the land, and their national inquiries led directly to the passing of the “Municipal Corporation Reform Act” in 1835. In Worcester all the money and property that remained from the original 27 charitable bequests was then transferred from the old un-elected Corporations to new independent bodies of Charity Trustees, initially appointed by the Lord Chancellor in 1836.

• c) In 1899 they were consolidated into one holding charity, the Worcester Consolidated Municipal Charity . Of these 27 charities, the 6 primarily and partly educational charities were consolidated into the Worcester Municipal Exhibitions Foundation in 1909. Both charities were managed together by the same body of Trustees from 1913 onwards.

• d) In 2016 the two charities were dissolved, and their entire assets and liabilities were transferred to the Worcester Municipal Charities CIO.(“WMC (CIO)”)

2. THE “CHARITABLE OBJECTS” OF THE WMC (CIO) ARE:

• (a) the relief of persons resident in the City of Worcester who are in conditions of need, hardship or distress including by making grants of money to individuals, or to organisations which provide relevant services; or providing or paying for items, services or facilities calculated to reduce the need, hardship or distress of such persons;

• (b) to carry on for the benefit of the community the business of the provision of social housing in the form of almshouses and affordable social housing and any associated amenities for persons in necessitous circumstances upon terms appropriate to their means; and

• (c) the advancement of education by promoting education in the area of benefit being the City of Worcester, the Parishes of Powick, Bransford and Rushwick and the area of the Ancient Parish of Leigh, all in the County of Worcestershire, in such ways as the Trustees think fit.

• (d) Twelve per cent (12%) of the Net Income of the CIO from its permanent endowment assets shall be applied for the educational purposes set out in clause (c).

The Trustees believe the charitable objects collectively constitute the public benefit requirement of the Charity Commission.

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3. "CONSTITUTIONAL GRANT” PRESCRIBED BY THE TRUST DEEDS

By virtue of the intention of the original benefactors and the original constitutions of the predecessor charities, the following grant is automatically payable each year:

"Nought point one per cent (0.1%) of the “Net” income of the CIO from its permanent endowment assets income of the CIO or as near as may be applied, shall be applied in augmenting the income of the charity called Palmer’s Educational Foundation in the Ancient Parish of Suckley in the County of Worcestershire."

If this is less than £950 it will be increased to that amount. There will be a review of the “top up” to £950 in 2023. Two Trustees of this Charity, Brenda Sheridan and Margaret Jones are nominated as trustees to the "John Palmer" Charity.

4. ADMINISTRATION OF THE TRUSTEE BODY

Worcester Municipal Charities (CIO) registration no.1166931 was established by the Trustees on 4 May 2016, and the business, staff, assets and liabilities of the two predecessor charities were transferred to it at midnight on 30 June 2016. The Trustees set up the CIO specifically as the successor charity and this report is the fourth year’s report of the Charity.

The Charity is administered by 17 Trustees.

Four are nominated by Worcester City Council; four are nominated by major beneficiary "stakeholder" charities chosen in a ballot of the Trustees every 3 years; and nine “independent Trustees” are co-opted by the Trustee body, being “persons who through residence, occupation, employment or otherwise, have special knowledge of Worcester City”.

On appointment, new Trustees are provided with induction training, given copies of the Constitution and Rules, the Annual Report and Accounts, a 2020 History of the Charity and a copy of the Charity Commission's publication CC3 “the Essential Trustee” which includes a trustee job description.

The 17 Trustees of the Charity during The Period were as follows:

Paul Griffth I , (Chairman), Martyn Saunders I , (Vice Chairman), Jenny Barnes N , from November 4th, Roger Berry I , Richard Boorn N , Paul Denham I , Ruth Heywood I , Graham Hughes I , Mike Johnson N , Margaret Jones I , Mel Kirk Ch , Roger Knight N , Sue Osborne Ch , Margaret Panter Ch , Robert Peachey N , until November 1st, Ron Rust I , Brenda Sheridan I , Geraint Thomas Ch .

" I " independent co-opted by the Board for 5 years;

" N " nominated by the City Council for 4 years;

" Ch " nominated by the 4 chosen major beneficiary "stakeholder" charities for 3 years i.e. Armchair, (Furniture Re-Cycling) Citizens Advice Worcester, Maggs Day Centre for the Homeless and Worcester Heritage & Amenity Trust (Tudor House Museum).

5. COMPOSITION OF THE TRUSTEE BODY AND THE ADMINISTRATION

The Trustees include people with experience in e.g. Social Services, Business Management, Child Care, Adult Care, Education, Housing, the Magistracy, Commerce, Finance, Planning, the Law, Property and Social Security. The Board of Trustees meet monthly, except in August and December, oversees the policy making of the Charity, signs cheques, scrutinises payments and bank balances, monitors the finances and reviews and approves the Grants Sub-Committee's recommendations.

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The Board carries out annual inspections of the property owned on a rotational basis - there are two whole day inspections a year; each property is visited once in every two years. The properties are all vested in the CIO as Custodian Charity.

A Grants Sub-Committee - meets monthly, to deal with the large numbers of individual applications for grants that require detailed consideration. The Chairman and Vice Chairman have delegated authority to make grants up to £1,000 in an emergency.

6. PROFESSIONAL ADVISERS AND STAFF OF THE CHARITY

The Charity retains Solicitors HallmarkHulme, Chartered Surveyors GJS Dillon, Chartered Surveyors ARC Ltd, Architects Lett & Sweetland, Auditors Kendall Wadley LLP, and Unity Trust Plc as Bankers. The Trustees wish to place on record their thanks to all these officials for their work in helping the Charity to deliver a worthwhile service to Worcester’s needy citizens. Thanks are also due to the staff: Adrian Robinson (Business Manager), Carlo Barentsen (Accountant), Maggie Inglis (Office Manager), Margaret Green and Sarah Bradnick (Administrators) who together run the Charity office on a day-to-day basis. (Full details of the Professional Advisers are on page 28).

7. THE "MISSION" STATEMENT, THE PUBLIC BENEFIT REQUIREMENT AND EQUAL OPPORTUNITIES

Public Benefit

The Trustees' “Mission” is to seek to achieve the public benefit objects set out in the Trust Deed, in compliance with the Charity Commission's guidance, and in the most efficient and effective way. The Charity attempts to earn as much as reasonably possible from its investments, and spends its income (after the expense of administration) on the Charity’s Public Benefit Objects.

Equal Opportunities

The Trustees do not discriminate against anyone in respect of employment and the provision of services because of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, or sexual orientation.

Permitted Discrimination

The Equality Act 2010 allows a charity to limit its benefits to people who share what are called "protected characteristics" i.e. those who are entitled to be considered in respect of granting the benefits the Charity offers. In other words:

• the governing document restricts benefits to people with a shared protected characteristic i.e. relief in financial need and/or educational need, and

• the benefits are provided in order to ameliorate these particular disadvantages, or need, linked to that protected characteristic

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8. A SUMMARY OF WHAT THE CHARITY ACHIEVED IN THE PERIOD

A. Major Events/Decisions by the Trustees in The Period

• During the year building work was started on creating 25 affordable flats for the homeless at 3-4 Shaw Street, the former Probation Offices. Listed Building Consent was obtained first and Homes England committed a grant of £1,000,000 gross. This development will take the total of new affordable dwellings for the homeless to 64 since 2013. Following a tendering process, the project is being undertaken by “D & S” our preferred Contractors and will be completed in 2021.

• The termination of the office lease by Probation, and the decision to develop the empty office as flats for the homeless, has deprived the Charity of £150,000 lost rental income annually for 3 years. As a result a loan is being arranged with Unity Trust Bank to facilitate the cash flow requirements.

• Helping four organisations in particular, being those that provide the most help to the poorest, and those in greatest need in Worcester: Maggs Day Centre for the Homeless, Worcester Citizens Advice and Armchair Furniture Re-Cycling, who have all been provided with free/ subsidised premises and grants to assist with their work, and to Worcester Community Trust towards their community centres and outreach work.

• The Trustees decided to cease funding Worcester Action for Youth because they were not providing good value for money due to excessive payments to their workers, and the Charity was wound up as a result.

• The Charity fulfilled a contract with the City Council to manage the purchase and distribution of £116,637, (2019 £72,062 net) worth of white goods in Worcester as part of the Discretionary Welfare Assistance Scheme (“DWAS”). The Charity won the contract in 2013 and again in 2017 to manage the purchase and distribution of white goods, which has been rolled over twice until March 2021. There is no charge for this administration in recognition of the relief it brings to the Charity’s overall grants’ budget.

• The Charity has registered a NILS (no interest loan scheme) with the DWP for grant recipients who want more than they have been awarded, and can afford repayment of the capital.

• The Charity increased grants to organisations, and staff salaries by 2.8%.

B. Annual Revenue Income and Expenditure

Revenue income of £1,842,939 (2019 £1,180,862) was received, which includes £866,673 relating to grants received in year and £943,351 rental income. Expenditure was £1,068,874 (2019 £988,519)

C. Summary of Property Owned

There are two Sheltered Housing “retirement” sites (32 almshouses) and eight “affordable Housing sites” (39 flats) for the homeless. The Charity also owns 17 Investment Properties with rental income. 10 "functional" properties are leased to charities on peppercorns as "facilities in kind" (see pages 14 and 24).

The Charity is developing one vacant property into 25 affordable flats for the homeless in 2020/21.

D. Rent Reviews and Accommodation Charges

Sheltered Housing accommodation charges were reviewed and scheduled rent reviews were completed. One commercial rent was increased in The Period.

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E. The Grants Sub-Committee met 12 times in The Period

Education, Relief in Need, Hardship or Distress Grants

• a) A constitutional grant of £950 was awarded by the Charity to the John Palmer’s Educational Foundation in Suckley.

• (b) The Grants Committee awarded relief in need and educational grants to organisations and individuals totalling £395,780 (2019 £375,799), and helped administer the City Council’s DWAS relief in need grants worth £139,964 inc VAT (£116,637 net), to individuals in need (details page 12).

• (c) The Charity has focussed its main help on four organisations in particular, being those that provide the most help to the poorest and those in greatest need in Worcester. The Maggs Day Centre for the Homeless, Worcester Citizens Advice and Armchair Furniture Re-Cycling have all been provided with free/subsidised use of premises worth about £80,000 and grants totalling £219,470 (2019 £213,491) to assist with their work for the poor, and Worcester Community Trust who receive a grant of £38,480 towards its community centres in social housing areas and outreach support.

• (d) In 2012 the Charity agreed to fund a Money Management Advice Post annually, based at the Citizens Advice Bureau which continues to provide excellent communication and grant administration between us in respect of mutual clients with financial problems. He also provides financial literacy advice. During 2019/2020 The Money Management Adviser interviewed 110 individual clients helping them with benefits, water bills, finances, employment and debt issues. The Local Citizens Advice Debt and Money Service also assisted clients to reschedule or receive a ‘write off’ of debts amounting to £1,292,777 in total, across all of their services.

• (e) In 2012 the Grants Committee ceased making grants for school uniform due to the Pupil Premium being paid to schools. Clothing grants for school children in need were however introduced, based on the family's income and expenditure, and their clothing needs.

• (f) In 2013 the Charity agreed to help fund a free Legal Advice Scheme annually in partnership with the Citizens Advice and originally the Worcester Law School, now the University, whose students provide supervised free legal advice to poor people. In 2019-20 the project assisted 189 clients and the total financial gains obtained for clients as a result of this project, were in excess of £630,000, during the year. In addition, Citizens Advice Worcester assisted clients to obtain financial gains of £2,450,409 from all services delivered in Worcester. This greatly increased the ability of all the clients assisted to manage financially.

• (g) In 2016 the Charity spent £500,000 purchasing and renovating a building for use by Maggs as a clothing project, administrative offices, a domestic training centre and a free clothes

• store, mainly for street sleepers . It was let to Maggs in December 2017 on a peppercorn rent, with the two flats for the homeless “over the shop” being managed by “SmartLets” at Worcester Citizens Advice.

• (h) The Committee awarded education grants of £36,168 to the Tudor House Museum, £13,672 to All Sorts of Performing Arts, £17,260 to Dancefest and £38,480, 50% for Education and 50% for relief in need, to Worcester Community Trust providing educational facilities, youth clubs, holiday play-scheme facilities and respite for carers in Worcester (see page 12)

• (i) In November 2019 the Trustees decided to cease funding Worcester Action for Youth on 31/03/2020 due to their very high administrative overheads. They had already given notice to vacate Medway Community Centre by 31st December.

• (j) The Committee continued leasing the Tudor House Museum , to Worcester Heritage and Amenity Trust at a nominal rent together with agreeing to pay the salary of a part-time curator and assistant until June 2021.

• (k) The Committee awarded 3 grants totalling £1,200 to individuals in need of financial assistance with their education (see page 12)

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9. ALMSHOUSES - AFFORDABLE HOUSING FOR THE RETIRED AND THE HOMELESS

The Charity owns two complexes of Retirement Almshouses:

and Berkeley Court, The Foregate - 7 flats

Nash's and Wyatt's Court, New Street - 25 flats

The former Berkeley’s Chaplain’s house became the Charity’s administrative offices in 2013 and the former Nurse’s house became the resident warden's house at the same time.

The former Chapel was converted to a community room in 1997 and is available for use by charities and non-profit making organisations, usually without charge depending on reserves’ levels.

The residents' accommodation charges were reviewed in The Period. All bar two of the residents receive Housing Benefit. In The Period two residents left and one was appointed.

The Resident Wardens and partner - Paul and Lorraine Saunders and Julie Fenson continue to provide a very high standard of first line support and care-taking, with specialist help from Headway Trust, who support as required.

Applicants for sheltered housing must be poor and must have lived in Worcester for at least 12 months. Retired or nearing retirement applicants are preferred, although applicants below retirement age are occasionally considered if they have a need for, and would benefit from, accommodation in a sheltered environment. The Charity advertises vacancies when available under “Accommodation Available” with the criteria.

Berkeley Court, Foregate Street - 7 flats Nash's and Wyatt's Court, New Street - 25 flats

General repairs and maintenance of the Sheltered Housing have been carried out throughout The Period. Testing and servicing of all gas appliances is carried out annually. Major capital repairs for the roof at Berkeleys and major refurbishment to three flats at Nash’s and Wyatt’s and one at Berkeleys are planned in 2021.

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AFFORDABLE HOUSING FOR THE HOMELESS - 64 NEW UNITS IN EIGHT YEARS

There is a widely held belief that an “Almshouse Charity” is for the elderly only, but it’s actually for poor people of all ages. “Relief in Need” includes giving a home to the homeless to meet their need.

Since 2013 the Charity has been pursuing a re-investment strategy of providing affordable housing for the single homeless, and since 2015 has been helped by Homes England with grants to create flats “over the shops” and in empty office buildings. This is an exciting new strategy that provides housing for the homeless and also makes a reasonable commercial profit from a worthwhile charitable activity, at a time when good investment returns are difficult to find, and affordable flats for the homeless are in very short supply. We have been fortunate to find a good quality reliable builder.

By the middle of 2021 the Charity will have a total of 64 new units of "affordable housing" created between 2013 and 2021. All the properties are managed on the Charity's behalf by "SmartLets" (part of Citizens Advice) who retain 15% of the maintenance contribution payments as a management fee.

27 Existing Flats

2013 - 9 Sansome Place 6 studio flats

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2017 - 15 St. Swithin’s
Street 4 bedroom HMO
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2014 - 16/17 St. Swithin’s Street
6 one bedroom flats
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2016 - 21 The Cross
3 one bedroom flats
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2017 - 19 Foregate Street 2017 - 59-60 The Tything
5 one bedroom flats, 1 studio 2 one bedroom flats
flat & a shop/office
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12 Existing Flats

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2018 - Sir Thomas White Court
10 new one bedroom flats
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2019 - 8 Sansome Place 2 one bedroom flats. Property owned by the Charity since 2002 and used by Maggs as a “free clothes store” for street sleepers until 2017. The Charity replaced it with a city centre building also providing a social training centre for the homeless and two flats, then created two flats in the old building.

25 Flats being created in 2020/2021

2020/21 - “Stillingfleet House” , 3-4 Shaw Street. 25 one bedroom flats being created in 2020/21 from this former Probation Office, owned by the Charity since 1994 and now empty following the tenants’ departure as a result of the privatisation of half the Probation Service.

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10. GRANTS AWARDED IN 2020 BY THE CHARITY

RELIEF IN NEED AND EDUCATIONAL GRANTS – (inc.+2.8%)

Grants determined by Constitution	Grants determined by Constitution	£
Palmer’s Educational Foundation		950.00*
0.1% of the Charity’s “clear” income or £950 whichever is the greater
"REVENUE" GRANTS TO ORGANISATIONS		£
Allsorts of Performing Arts	Running Costs	13,672.00*
Armchair furniture recycling	Running Costs, free furniture - means tested	16,444.00
Citizens Advice	Running Costs, advice, support, legal aid	173,381.00~
Dancefest	Dancing lessons, (social housing areas)	17,260.00*
Maggs Day Centre	Running Costs, day centre, clothes, training	29,645.00
Shopmobility	Running costs, (frozen, as not means tested)	7,000.00
Worcester Community Trust	Holiday play schemes (social housing areas)	38,480.00*#
WHAT Tudor House Museum	Curator and Learning Ofcer salaries	36,168.00*
	Total	£333,000.00

• Educational grants

50/50 relief in need and education.

~ Citizens Advice core support costs £104,594 - 60%; legal aid project £30,180 - 17.5%; money advisor £34,068 - 20%; ethnicity training & language (education) £4,539 - 2.5%;

INDIVIDUAL GRANTS		£
Education grants of £1,000 or more		0.00*
Education grants under £1,000		1,200.00*
Relief in Need grants under £1,000 for carpets		50,138.00
Relief in Need grants under £1,000 for white goods and other		11,444.00
DWAS Relief in Need grants under £1,000 for white goods (£139,923.41	gross)	116,637.00 (net)
	Total	£179,419.00

The grants included educational grants and the following essential household and personal items: Carpets, Washing Machines, Cookers, Electric Clothes Driers, Fridges, Fridge Freezers, Microwaves, Clothing Grants, Removal Costs, Vacuum Cleaners, PCs and “other household items”

Grand Total £512,419.00

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WORCESTER MUNICIPAL CHARITIES (CIO)

11. Relief in Need Grants & Grants to Promote Education for Individuals in Need

GENERAL POLICIES & PRACTICES – ADVICE FOR SUPPORT WORKERS & APPLICANTS

It is the Charity's policy not to make a grant if adequate funds are available from:

1. Family/Friends

2. DWAS for white goods - www.worcester.gov.uk/discretionary-welfare-assistance-scheme

3. DWP for a Budgeting Loan - www.gov.uk/budgeting-help-benefits/how-to-claim

4. Health Authority for disability aids - www.hacw.nhs.uk/services/service/wheelchair-posture-mobility-service-93/

5. County Council for child care services and services for adults

• www.worcestershire.gov.uk/info/20501/children_young_people_and_families

6. Student Finance England for promotion of education - www.gov.uk/apply-for-student-finance/how

The application form must be endorsed to show that all 6 options have been considered and with what result. Failure to do so will mean the application will be deferred to enable these enquiries to be made.

The Grants Committee will consider the income and expenditure sheets of each applicant and their ability to meet their own needs, with budgetary assistance from Citizens Advice Worcester if required.

Applications may be turned down if the applicant has not demonstrated financial hardship, or is seriously mismanaging his/her income by spending excess amounts on luxury items like “Sky TV” rather than on necessities like food and clothes. Individual budgetary advice may be provided by the Citizens Advice Money Adviser in such cases.

To consider, as a condition of any grant to an individual, the possibility of debt advice, usually with help from Citizens Advice Worcester.

Not to commit the Charity to repeat a grant to an individual or organisation.

The Trustees reserve their complete discretion in all cases.

GRANTS FOR RELIEF IN FINANCIAL NEED

Can be considered for people living in Worcester City only.

All applications from an individual for a relief in need grant must be endorsed by a support worker from the statutory or voluntary bodies in Worcester, using the forms available on the Charity’s web-site. The support workers are relied upon to provide to applicants such additional help that the applicant may require e.g. in respect of their vulnerability and other needs.

One-off grants can be considered for “essential” items like cookers, fridges, fridge freezers, washing machines, clothes airers, food, clothes, fuel bills, carpeting, a television, a vacuum cleaner, other household items; in exceptional circumstances help may be considered for holidays or holiday activities.

The Trustees judge as “essential” those items that people generally nowadays feel they cannot manage without, and that form part of an expected way of life in today’s society. The Charity is a last resort and is unable to help if there is statutory assistance available.

GRANTS TO PROMOTE EDUCATION

Can be considered for people in need, of any age, living in Worcester City, the Parishes of Powick, Bransford and Rushwick, and the Ancient Parish of Leigh.

Applicants for educational grants do not need a support worker but references/reports may be requested from the institution concerned.

Applications may be considered from people of any age who live outside these areas but who have attended school in the City for at least two years.

The Trustees will not normally consider applications from persons attending educational establishments in the City who, prior to enrolling, lived outside these areas for two years or more, and/or who still live outside them.

The Trustees will not normally consider applications from persons attending educational establishments with national catchment areas e.g. the New College (for the blind) and Worcester University, unless they were resident in the area of benefit for at least two years, or attended school in the area of benefit for at least two years, prior to enrolling at the relevant institution.

Applications in respect of fee-paying institutions, for travel abroad, and awards beyond 1st Degree level are normally excluded.

Assistance with school uniform grants is not provided in the light of the Government’s Pupil Premium payments to schools for such purposes. Any requests for non-distinctive clothing may be considered for a “relief in need” grant based on family income and expenditure.

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WORCESTER MUNICIPAL CHARITIES (CIO)

12. A SOCIAL INVESTMENT PROGRAMME – 1996 Onwards

Free use of the Charity’s property facilities in 2020

Since 1996 the Charity has been donating some “surplus” funds to provide subsidised office accommodation for like-minded City charities who are helping the poor or providing free education or educational facilities in areas of social need and at Tudor House Museum.

The charities SORP (FRS 102) requires that facilities and services donated to a charity for its own use which it would otherwise have purchased must be included in the Charity's accounts when received, provided the value can be measured reliably. Value to the beneficiary Charity is the amount that the Charity would pay on the open market for an alternative item that would provide a benefit to the Charity equivalent to the donated item. Worcester Municipal Charities (CIO), as the donors of these "facilities" to the charities concerned, have estimated the rental values based on 8% of their capital value as contained in the Quinquennial Valuation of 2020 as follows, with the exception of leasehold properties which have been estimated individually based on the advice from their Chartered Surveyors, and any actual bills paid in “The Period.” They will be revalued in 2025.

No. PROPERTY - LET ON A PEPPERCORN TO: Capital 20 Armchair 6B Checketts Lane Trading Estate Leasehold 50 years lease from 1996 bought on premium 28/29 1 & 2 Inglethorpe Court(50 years' Leasehold 2001) £115,000.00 Citizens Advice 40/41/42 Old Glove Factory, 13 & 15 Lowesmoortotals [£850,000.00] Old Glove Factory, 13 & 15 Lowesmoor Citizens Advice(68% of £68,000 total) Total service charges utilities etc paid by WMC 43 St. Albans, Deansway(150 years' leasehold 2008) £50,000.00 Maggs Day Centre 44 Tudor House, Friar Street (125 years' leasehold) £100,000.00 WHAT. Lease £1.00; £1,000 p.a. insurance paid. 46 Medway Youth & Community Centre £75,000.00 Worcester Action for Youth All Sorts of Performing Arts (50 years leasehold from the City 2012) 53 Maggs Clothing Store, Activity Centre Ofces and Shop 59/60 the Tything £250,000.00 Total facilities in kind provided in this period:

Rental Value Paid up-front £9,200.00 [£68,000.00] £46,240.00 £7,814.00 £4,000.00 £8,000.00 £6,000.00 £20,000.00 £101,254.00

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PROPERTIES DEVELOPED/PURCHASED IN THE SOCIAL INVESTMENT PROGRAMME

From 1996 onwards, the Trustees began investing some of the “surplus” accumulated income from new rents, to purchase property for social community projects that benefited the poor. The thinking then was that other charities that were in the same business of helping poor people, but had no income of their own, would welcome such a boost, and a secure rent-free base would be attractive to their potential funders.

Relief in Need - the programme eventually encompassed the major Worcester charities providing financial relief in need for the City’s poorest e.g. Citizens Advice Worcester, Armchair Furniture Recycling, and the Maggs Day Centre for the Homeless. CAB and WHABAC, two of the Charity’s major beneficiaries, merged on April 1st 2009. The development of both, especially their office moves to suitable rent-free premises, was due mainly to the Trustees’ support and generosity.

Both Maggs and Armchair also enjoyed rent free premises and annual grants and still do.

Educational facilities , provided rent-free, consist of the Tudor House Museum (WHAT (Worcester Heritage & Amenity Trust) and Medway Youth and Community Centre (All Sorts of Performing Arts). The Charity is obliged by its constitution to spend c.12% of its net income on educational provision.

1996 - Berkeley’s Chapel was refurbished at a cost of £150,000.00 as a Community Centre and Meeting Room. The Chapel was virtually derelict and almost unused. Once the Civic Society’s radical objections had been overcome, Martin Jones oversaw the tasteful conversion with Proberts as the builders. The refurbished Chapel is now used for almshouse residents’ meetings, Trustees’ meetings, and community meetings, and is offered rent-free to Worcester charities providing they have less than one year’s running costs in reserve.

1996 - Goodrich House , Sansome Place, Offices & Car Park was purchased for Home-Start and refurbished at a total cost of £150,000.00 . The building then known as “Saga House”, previously “AEU Offices” was renamed after Margaret Goodrich (The Home-Start President) and was then used until 2014 when cuts in County Council funding led to the Charity being down-sized and moving to their own premises in Malvern. Terms were agreed for the surrender which took account of the un-expired lease, and the offices and car park site were then converted to 10 flats for the homeless in 2017/18 and re-named “Sir Thomas White Court” with 4 of the flats in the former Home-Start office and 6 are new-build on the car park.

1996 – Armchair , 6b Checketts Lane Industrial Estate. The WMC Charity purchased 6a and 6b mainly to provide a learning disability day centre at 6a for the County Council. However 6b was offered to Armchair to enable them to move out of an expensive leaky rented warehouse in Back Lane South. Armchair was successful in getting a Lottery grant and purchased a 50 years’ lease from the Charity for £55,000, which means no more rent until 2048 when the Trustees will probably charge £12 a year.

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1998 - Worcester Citizens Advice Bureau – A donation of £100,000 was made towards the planned new-build offices in The Hopmarket. The proposal looked unachievable until the Charity stepped in, awarded the grant and then helped to construct a Big Lottery application which yielded a further £304,000. Peter Sweetland, the Charity’s architect, drew the plans and organised the construction, including overcoming very difficult access problems. The new building opened in 2001.

2000 - 1 & 2 Inglethorpe Court in The Hopmarket Yard behind the new Citizens Advice Worcester offices were purchased and converted at a total cost of £150,000.00 . They were purchased by the

Hopmarket Charity in a derelict condition, and then leased to

the Charity for £1 a year for 50 years on an “unimproved” basis. £135,000 was expended on the very tasteful refurbishment work by Peter Sweetland and the buildings have been occupied continuously since, at £1 a year by Citizens Advice. In 2019 Citizens Advice decided it could manage without them, and the possibility of converting them into 4 flats for the homeless was looked into in 2020. The Hopmarket Charity has been asked to replace the part-expired 50 years’ lease with a new 61 years’ one as Homes England insist before awarding grant aid.

2002 - 8 Sansome Place , a free Clothing Store for street

sleepers and people in need was purchased for £73,437.00 from the private owner, when the WRVS (tenants) decided to close it down due to a policy change. The Worcester Salvation Army offered to run it as a free clothes store and were given a £1 a year lease. They unfortunately sub-let it, without permission, to the Worcester City Mission (“Lydia Project”) who began gradually turning it into a church, holding services there, and selling donated clothes to fund the religious Mission, rather than helping the poor. They were evicted and it was then offered to Maggs in 2005 who ran it as a clothes store etc., for street sleepers and others in need. However, in 2017 the Charity purchased 59/60 The Tything as a replacement for Sansome Place and their leased office at 7 Copenhagen Street

which was surrendered. 8 Sansome Place was then converted to 2 flats for the homeless in 2019.

2004 - “The Old Glove Factory” 13-15 Lowesmoor, a large derelict building with two shop-fronts,

was bought for £368,500.00 from the Catholic Church after a 3 years’ wait. It was refurbished imaginatively by Lett & Sweetland in 2005/6 at a cost of £1 million , and initially let to Worcester Housing & Benefits Advice Centre, Ethnic Access Link, Headway and the Black Pear Credit Union, all at heavily subsidised rents. The official opening by the Princess Royal took place on 7th February 2007. WHABAC and CAB had merged in 2009, and in 2018 were renamed “Citizens Advice Worcester”. Headway, the Black Pear Credit Union and Ethnic Access Link left, and the two street facing shops were let commercially in 2018. Citizens Advice Worcester now occupies the rest of the building on a peppercorn rent of £12 p.a.

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2008 - Tudor House Museum , Friar Street. In 2004 John Bennett and Jim Panter, Trustees from WHAT (Worcester Heritage & Amenity Trust) approached the Charity in respect of a possible partnership, to acquire the Museum on a sustainable and affordable basis, with WHAT running it, mainly with the help of volunteers. The Trustees agreed to investigate the possibility and Philip Jones then negotiated an agreement for a 125 years’ lease from the City Council at a premium of £100,000. The Charity then sublet the Museum to WHAT, initially on a 35 years’ lease for £1 p.a., with a £1,000 contribution p.a. towards the insurance and £1,000 towards the repairs’ sinking fund. The Charity also makes a generous contribution annually towards curator staff costs and has

committed £4,000 p.a. to a repairs’ and refurbishment sinking fund.

The building has been adopted by the Worshipful Company of Clothiers as its home base.

2009 - St Albans, Deansway, the Maggs Day Centre for the homeless , received an ill-conceived demand for a commercial rent of £10,000 p.a. from the Diocesan Board of Finance intended for the clergy’s pension fund. This unfortunate episode followed a rent free period in return for putting the neglected building in a good state of repair some 30 years earlier. On hearing the possible plight of the homeless service users, the Charity stepped in, suggested the Diocese seemed to have lost sight of its own obligations to the poor, offered to buy the freehold but was turned down. The Charity then asked their valuer Philip Jones to try to negotiate a compromise agreement, and he secured a 150 years’ lease at a cost of £47,500 . It was then sub-let to Maggs by the Charity for £1 a year until

2030 when it will be

renewed for the remainder of the head lease until 2159.

2011 – The 18th Worcester Scout Hut and Youth Club (Medway Youth & Community Centre) was purchased for £1.00 from the Scouts who had been wound up. The Charity then acquired a new 50 year lease from the City Council who own the land. It was refurbished at a cost of £30,000 to make sustainable youth and community provision for Lower Ronkswood, now housing All Sorts of Performing Arts as the peppercorn rent tenant.

2017 - 59/60 The Tything was purchased for £305,000 in 2016 by the Trustees for use by Maggs as administrative offices, with a free clothes shop for the poor/homeless, and a domestic training centre for day centre service users. There are two flats upstairs for the homeless (modernised with help from a Homes England grant) and managed by SmartLets. The purchase allowed the Charity to surrender a leased Maggs office at 7 Copenhagen Street, and also released the old existing “free clothes” store at 8 Sansome Place for conversion to two flats for the homeless in 2019. The whole project cost c. £500,000 . In 2020 an extensive dry rot infestation came to light and its eradication is proving difficult and expensive.

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13. THE CHARITY’S STRATEGIC OBJECTIVES, INVESTMENT POLICY & REVIEWS

Put simply, these are to fulfill the registered charitable objectives for people in need, by using its endowed funds to provide the necessary income to the “best advantage”, inter alia, by ensuring the process involves “value for money” principles.

The Charitable Objectives

• (a) the relief of persons resident in the City of Worcester who are in conditions of need, hardship or distress including by making grants of money to individuals, or to organisations which provide relevant services; or providing or paying for items, services or facilities calculated to reduce the need, hardship or distress of such persons;

• (b) to carry on for the benefit of the community the business of the provision of social housing in the form of almshouses and affordable social housing and any associated amenities for persons in necessitous circumstances upon terms appropriate to their means; and

• (c) the advancement of education by promoting education in the area of benefit being the City of Worcester, the Parishes of Powick, Bransford and Rushwick, and the area of the Ancient Parish of Leigh, all in the County of Worcestershire, in such ways as the Trustees think fit.

• (d) Twelve per cent (12%) of the Net Income of the CIO from its permanent endowment assets shall be applied for the educational purposes set out in clause (c).

Strategic Financial Reviews and Reinvestment Programmes 1980s/90s and 2013 onwards

Background

The Charity’s annual income is composed almost entirely of rents from its commercial properties , ” comprising shops, offices and warehouses, and from its two types of “ affordable social housing - almshouses for retired people (32 units), and almshouses for the “ younger homeless ” (39 units, with another 25 under construction, and another 4 in the pipeline subject to planning and funding).

1980s. In the first part of the 20th century the Charity’s endowed property comprised principally farms, farmhouses, cottages, and farmland, across Herefordshire and Worcestershire, together with a small amount of commercial property in Worcester. Following an investment policy review in the late 1980s, the Charity began a wholesale transition from agricultural to commercial investments, including the purchase of two very large offices resulting in large rental increases.

Building on that success, the Charity disposed of all its stock-market holdings and reinvested that money also in commercial property, with similarly improved returns. This policy effectively quadrupled the Charity’s income and proved wholly successful for about 25 years, allowing more money to be spent on the beneficiaries, and providing sponsorship for like-minded Worcester charities helping the needy.

2012 onwards, as the High Street recession began to seriously affect the viability of the commercial shops and the larger offices, the Trustees began reviewing their investment policies and looking at alternative forms of investments given the low interest rates which were still falling.

The Trustees’ review concluded that the reinvestment policies that had been pursued following the 1980s review, were effective, and were the best that could be devised at the time for the Charity and its beneficiaries, both short and long term. However, the buoyant days of the High Street shops and city centre offices were clearly on the wane, the bubble was bursting and new sustainable strategies were becoming urgent. As a result when offices became vacant they were either sold, or converted into flats for the “younger homeless”. Flats were also created over the charities’ own shops where possible with reduced rents for the shop-keepers below to help make their businesses viable.

The table on the next page sets out the financial gains and losses from the reinvestment programme and the final overall financial outcome which is an estimated loss of £22,000 p.a. revenue.

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IN AN INVESTMENT SWITCH WMC SOLD, CONVERTED OR RE-LET THESE PROPERTIES TO RAISE THE NECESSARY INCOME AND CAPITAL:

A.	Property Sold	Rent Loss	Sale Price
2013 2016	Wargrave House Surgery (Hereford) sold to G.P. tenants Bricklehampton smallholdings sold by sealed ofers	46,700.00 3,638.00	602,000.00 321,500.00
2016	4 Checketts Lane (Day Centre) Charity wound up - CC cuts	1.00	195,000.00
2016 2017 2017 2017 2018	38 Lowesmoor (Charity Shop) Charity wound up - CC cuts Pan Pizza New Street - cost £168,000 - sold due to high ofer 48 Gaol Street, Hereford (empty ofces) - NHS cuts 2 Hawthorne Cottages (Bromyard) sold by sealed ofers 23A St Owen’s Street, Hereford (empty ofces) - NHS cuts	1.00 15,000.00 10,750.00 1,000.00 10,000.00	191,000.00 300,000.00 128,000.00 222,000.00 154,600.00
Totals	5.8% rent loss on investment	87,090.00	2,114,100.00
B.	Property Conversions	Rent Loss	Rent Gain
2017	8 Sansome Place - empty due to MAGGS move to Tything	1.00	10,000.00
2018	Goodrich House - empty due to Home Start move, re-named	1.00	50,000.00
2018	1 & 2 Inglethorpe Court - vacated by Citizens Advice to be let	2.00	20,000.00
2019	3-4 Shaw Street Ministry of Justice lease expiry	150,000.00	140,000.00
Totals		150,004.00	220,000.00
C.	Social Investment Property Re-let Commercially	Rent Loss	Rent Gain
2017	Old Glove Factory Shop - let commercially to Tanning Salon	nil	9,500.00
2018	Old Glove Factory Shop - let commercially to Hairdresser	nil	6,240.00
Totals		nil	15,740.00

The Charity created the following 39 affordable almshouse flats for the homeless and will create a further 25 taking the total to 64 by 2021.

taking	the total to 64 by 2021.
Date	Address	Status	Numbers
2013 2014 2015 2016	9 Sansome Place 16/17 St. Swithin’s Street 19 Foregate Street 21 The Cross	purchased owned purchased leasehold	6 studio fats 6 one bedroom fats 5 one bed & 1 studio fat 3 one bedroom fats
2017	15 St. Swithin’s Street	owned	4 bed HMO
2017 2018 2019 2020	59/60 The Tything Sir Thomas White Court 8 Sansome Place 3-4 Shaw Street	purchased owned owned owned	2 one bedroom fats 10 one bedroom fats 2 one bedroom fats 25 one bedroom fats
Total			64

ESTIMATED FINANCIAL SUMMARY OF THE INVESTMENT SWITCH TO HOUSING

Capital raised for housing developments by sales 2013 - 2018

£ 2,114,100.00

Revenue

Lost rent from properties sold or converted Lost Rent from Shaw Street 64 fats created x approximately £5,000 rent Lowesmoor Social Investment property re-let commercially Inglethorpe Court 4 fats x £5,000 Total Annual Revenue Increases by 2021 Total Management fees due to Citizens Advice 15% p.a. Rent voids & bad debts say voids 3% & bad debts 2% = 5% Housing property maintenance say (£1,200 per unit) Total Annual Revenue Expenditure Decreased nett expendable charitable income

(87,090.00) (150,000.00) 320,000.00 15,740.00 20,000.00 £118,650.00 48,000.00 16,000.00 76,000.00 £140,000.00 (£21,350.00)

Homes England - this reinvestment programme was greatly enhanced by grants for housing between 2016 - 2020 of c. £1,610,000.00

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From 2018 onwards , registered Housing Associations are obliged to spell out in the Annual Report whether they comply with the HE Standard and how. As part of the initial registration process the Charity had to provide evidence to demonstrate that it was financially viable and had good quality financial controls and procedures in place. These have being updated to reflect the practices adopted subsequently.

The purpose of the Charity’s financial investment is to yield the best return possible within the level of risk considered to be acceptable. There is also a legal requirement to review investments from time to time and to diversify investments.

The strategic, incremental changes to investment made since the 1980s are set out above, with the underlying rationale for those made over the past 33 years. The Charity has recorded its income and expenditure carefully, and the headline results are that the earned income from investments has risen from 1985 by an average compound increase of 6.35% every year compared to a UK average of 3.54%.

The Charity reviewed its Investment Policies and Procedures in 2018 and reported its findings to the Board at its January 2019 meeting. A major factor in this very favourable financial result has been the longstanding policy decision to accumulate unspent contingency money of up to 10% on property investment each year, by saving it up gradually until more property can be afforded without borrowing. However this strategy was put in abeyance in 2018 as part of the attempt to recover the lost rent of £150,000 annually from the Shaw St. offices and replace it with the rent from 25 new flats for the younger homeless.

The Returns on the “High Street” Properties of shops and offices are static/falling , and present a very real challenge. Where street access is possible, turning the upstairs into flats for the homeless has proved successful, but it’s hard to find another economic way forward. There are two charity shops let on beneficial rates which seem to be afloat, but in reality only those “shops” like hairdressers, beauty salons, shoe repairs and food shops are surviving, as none of them have to compete with on-line sales. However, the butcher’s shop is easily the best and most popular in town and looks set to continue its success.

The rent reviews due in 2020 were settled on a stand-still rent basis apart from the retirement almshouses for which the Charity was entitled to CPI + 1%. The homelessness almshouses are also entitled to similar inflationary increases.

Most of the commercial shops are in a single street , the lower part of which has been dubbed “charity alley”. However it does have a wonderful footfall as it provides the main pedestrian route to The Shambles and the new Asda further down. Like other landlords in a similar position, the Charity can only wait and see what happens and in the meantime diversify into residential property.

The Charity has been delighted to be able to take advantage of grants between 2016 - 2020 worth c. £1,610,000 from Homes England , which have greatly increased the pace of providing more almshouses, whilst allowing the Charity to maintain its network of financial support to the homeless. The Charity also sponsors a homelessness day centre, a domestic training unit, a free clothes store, and free recycled furniture for the re-housed. The Education budget sponsors a dance charity a performing arts organisation and a free Museum.

The Board reviews its investment strategy and almshouse maintenance strategy regularly, including consideration of where savings might be made, for example by installing solar panels and water meters which have been done.

Cost comparisons with other housing associations are problematic without detailed reports on the age and present state of repair of their entire housing stocks.

Routine Almshouse Maintenance Costs

Between 1899 and 1985 the Charity “lost” 32 of its original 64 retirement almshouses. This was due entirely to a lack of routine maintenance, which was caused mainly by a policy decision not to charge rent, even when Income Support first became available through the Beveridge reforms in the late 1940s. Almshouse properties decayed and were sold for development or modernisation, or were demolished as they became uninhabitable, and the sites were sold.

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In 2018/19 the Charity monitored the cost of maintaining the 27 affordable homelessness almshouses then being let, and it produced a figure of £735 plus a 15% management fee of £750 for SmartLets, part of Citizens Advice, who support a “difficult to manage” group of residents on licences to occupy. A figure of £1,000 was applied to all 39 units in the 2019 budget which proved sufficient. Based on advice from the Almshouse Association, the routine maintenance figures for the 2021 budget have been set at £1,405 for each retirement unit, and £1,031 each for the homelessness ones.

By 2021 the Charity will have more than recovered its losses with a total of 96 units . These comprise 7 built in 1708, 25 in the 1960s (replacing 24 built on the 16th Century site), 39 between 2013 - 2019, and 25 in 2020/21. The 7, originally built as 14, were not modernised until 1965, with toilets installed instead of privies. They were reduced in number from 14 to 7 in 1981, by turning two into one, and baths were replaced with showers in the 1990s. The 25 built in 1964 on a 16th century site, originally with 15 almshouses which were demolished, have had a complete modernisation of the electrical wiring, showers installed to replace bathrooms, and a rolling programme to replace the kitchens will take place between 2020 - 2025. The 39 built between 2013 and 2019 for the younger homeless receive minor maintenance and repairs arranged by SmartLets” the agents.

“Programme Related Investment”

“uses In 2013 the Charity adopted this Charity Commission recognised definition for when a charity The 64 assets to directly further the charity’s aims, whilst also generating a financial return”. new “affordable” flats for the homeless, provide an approximate rental return of £320,000. The 2019 Investment Report to the Board demonstrates that the reinvestment strategy is both sustainable and diverse and, in particular, replaces the lost income of £150,000 from the vacation of the Shaw Street offices in 2018 with 25 affordable flats for the homeless. The alternative option to sell the building for development would have realised only about £500,000 to invest, which represented a huge potential loss to the Charity and its beneficiaries. The Trustees believe they have made the best of a bad job, brought about through circumstances entirely beyond their control, due to the Government’s disastrous privatisation of half of the Probation Service, (since reversed), which was largely responsible for their departure from the offices.

Tendering Policy for Capital Projects - Threshold of £500,000

In 2013/14 the Charity sought competitive tenders for the development of 12 affordable flats for the homeless and appointed D & S, the chosen contractors as “preferred providers.” It was agreed that the preferred provider would be used for all work under £500,000 but their tenders would always be checked by our retained Quantity Surveyors. The one exception to this was two contracts for 10 flats on a single site in 2018 where the preferred provider was awarded the first contract at £273,000, and then offered the second at £657,240 as there were no preliminary charges which benefited the Charity considerably.

Competitive tenders were sought for the c. £2 Million contract in 2019 but of the seven contractors who expressed an interest in tendering, five declined. Three further enquiries were sent out with only one of these returning a favourable response. There were three confirmed tenderers but one was based in Leominster, a second in Gloucester, and only one, D & S, in Worcester. The Charity enquired whether a negotiated tender would be acceptable to Homes England, and were advised that it would be, providing that “independent” advice was obtained from a Quantity Surveyor which was arranged. At the November Board Meeting the Trustees formally agreed to approve negotiated tenders. The Charity also has in place preferred providers for water, electricity, general maintenance and carpentry.

Future Investment

There is no real shortage of retirement facilities for the elderly in Worcester; commercial high street shops and offices are on standstill rents; and any new capital, if it can be matched by HE grants, will be directed towards affordable flats for the single homeless.

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Homes England - Value for Money Metrics

Each year the Charity uses a range of data to measure VFM progress. The results help influence investment decisions and provide regulators and other stakeholders with information on the progress of the Charity.

Metric	2020	2019	Commentary
Reinvestment percentage	20.15%	2.12%	This is the cost of development and/or acquisition of new or existing housing properties as a percentage of the value of the ones already owned. The Charity developed 25 further social units this year which are due to be completed in early 2021.
Percentage of new supply delivered	35.21%	2.82%	This is the number of social housing units developed or newly built during the year as a percentage of the number of social housing units held at the year end. The Charity developed 25 further social units this year which are due to be completed in early 2021.
Social housing cost per unit	£3,594	£4,427	This is the total cost of ownership and management of social housing units divided by the number of units owned and/ or managed.
Operating margin as a percentage (social housing)	40.14%	22.53%	The operating margin on social housing activity only i.e. total social housing income minus total social housing expenditure, expressed as a percentage of total income. Last year major repair works were undertaken to the charity Almshouses.
Overall operating margin	26.85%	20.42%	Overall operating margin i.e. total income minus total expenditure excluding fair value adjustments on properties of the organisation, expressed as a percentage of total overall income.
Return on capital employed (ROCE) as a percentage	3.20%	1.46%	This is the overall operating margin excluding fair value adjustments on properties divided by (total assets minus current liabilities).

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14 . THE COST OF ADMINISTRATION & GOVERNANCE

The more a charity earns, and the less it spends on administration, the more there is available for direct charitable expenditure and grants. The Trustees therefore remain anxious to ensure that there is no unnecessary waste on administration.

Every effort is made to keep the cost of administration to a minimum. The Trustees themselves do not claim expenses. However, with 22 Trustee meetings, two property inspections a year and the inevitably high cost of servicing a huge volume of individual applications for assistance, there is an inbuilt unavoidable administration cost. In The Period the Charity spent £6,305 (0.3%) of gross income on Governance and £103,599 (6%) of gross income on Administration.

15. QUINQUENNIAL PROPERTY VALUATIONS

In 2010/2015/2020 the Trustees commissioned quinquennial property valuations. The Commercial Properties were valued by GJS Dillon and the agricultural properties by ARC Surveyors. The “Functional Properties”, occupied by the Charity and others with similar objects, were also re-valued based on vacant possession. The results were 2010 £13,776,750 , 2015 £13,700,000 and 2020 £14,532,000 .

16. PROPERTY INSURANCES

In 2010 the Trustees commissioned a complete revaluation of property insurance including accurate rebuilding costs and loss of rent calculations. The insurers are still Ecclesiastical Insurance Office Plc, arranged through Hazleton Mountford Ltd

17. RESERVES POLICY AND FINANCIAL RISK ASSESSMENTS

In 2010 the Trustees reconsidered their reserves policies and decided to set aside reserves on an “ad hoc” basis when required e.g. for a capital programme or major repairs or maintenance. Each year a contingency sum of approximately 10% is set aside by the Charity in its annual revenue budget for unforeseen expenditure. Any unspent contingency money is transferred to the reserves to purchase new investment properties when sufficient is available, to help the Charity at least keep pace with inflation. Until 2018 this process has brought the Charity compound inflationary increases of 6.35% p.a. compared to the national average of 3.54%. The practice ceased in 2020 due to the need to spend £2 Million + on creating 25 flats in 3/4 Shaw Street when it was also agreed to borrow £500,000 to help the cash flow until the new rents arrive.

The total funds of the Charity as at the year-end amounted to £15,442,557 (2019 £17,352,377, consisting of restricted funds of £nil (2019 £nil) and endowment funds of £13,254,840 (2019 £14,489,403). Designated funds, which are funds set aside by the Trustees for future projects amounted to £131,622 (2019 £159,675), leaving unrestricted funds amounting to £2,086,095 (2019 £2,703,298).

Free reserves after making allowances for tangible fixed assets and investment properties amounted to £866,095 (2019 £1,512,174).

“New Risks” form the first agenda item for all Board meetings.

18. STAFF REMUNERATION

The Trustees review the pay of all paid staff and self-employed staff at the January meeting of the Board each year and generally, subject to affordability, increase salaries of both groups by UK CPI inflation.

19. SERIOUS INCIDENTS

The Trustees confirm that in The Period ended 31st December 2020 there were no “serious incidents” to report.

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20. THE CHARITIES' PROPERTY PORTFOLIO FOR THE PERIOD

	ADDRESS	PROPERTY	AQUIRED	AQUIRED	AQUIRING	TENANT/OCCUPANT
					CHARITY~
1.**	2 St Swithin's Street	Shop		1560	St Thomas's Day	Timpson Ltd
2.**	3 St Swithin's Street	Shop		1560	St Thomas's Day	Miss Sarah Johnson
3.	15 St Swithin's St, Ground Floor	Shop + 1st foor room		1560	St Thomas's Day	M & M Meats (Nelmes Family)
3A.	15 St Swithin's Street	4 Social Housing Units		1560	St Thomas's Day	Citizens Advice 4 HMO Residents
4.	1 The Cross	Bank		1618	Inglethorpe's	National Westminster
5.	16 St Swithin's St, Ground Floor	Shop		1618	Inglethorpe's	Headway
6.	17 St Swithin's St, Ground Floor	Shop		1618	Inglethorpe's	SCOPE
6A.	16/17 St Swithin's St, Upper Floors	6 Social Housing Units		1618	Inglethorpe's	Citizens Advice 6 Residents
7.	Nash's & Wyatt's Court	25 Social Housing Units		1661	Nash's	25 Residents
8.	25 Nash's & Wyatt's Court	1 Flat		1661	Nash's	Warden's Flat
9.	13 Nash's & Wyatt's Court	Community Room		1661	Nash's	Residents
10.*	Berkeley Court	7 Social Housing Units		1692	Berkeley's	7 Residents
11.*	Kateryn Heywood House	Charities' Ofces		1692	Berkeley's	WMC & Laslett's Charities
12.*	Berkeley's Chapel	Community Room		1692	Berkeley's	Residents & charities
13.*	The Gatehouse, Berkeley Court	Warden's House		1692	Berkeley's	Warden's House
14.*	The Cellar, Berkeley Court	Electricity sub-station		1692	Berkeley's	Western Power Distribution
17.	22 The Cross, Ground1st, 2nd & 3rd	Shop & Flat		1990	WMEF	Mr Spyros Tsangarakis
18.**	3 - 4 Shaw Street	Ofces & Car Park		1994	WCMC/WMEF	Void
19.#	6A Checkett's Lane Ind. Est.	Ofces		1996	WCMC	Enterprise Driver Training
20.#	6B Checkett's Lane Ind. Est.	Furniture Store		1996	WCMC	Armchair
21.	Castle House, Castle Street	Ofces & Car Park		1997	WCMC	Swanswell Charitable Trust
22.	20 Church St, Evesham	Charity Ofces		1997	WCMC	Evesham & District Mental Health
27.	Sir Thomas White Court	10 Social Housing Units		1997	WCMC	Citizens Advice 10 Residents
28.#	1 Inglethorpe Court	Empty ofces		2000	WCMC	Void
29.**#	2 Inglethorpe Court	Empty ofces		2000	WCMC	Void
32.	Crown Lane Wychbold 1	Warehouse, Ofces & Carpark		2000	WCMC	Worcestershire CC
33.	Crown Lane Wychbold 2 & 3	Wheelchair Clinic & W'shops		2002	WCMC	Worcs. Health & Care NHS Trust
37.**	8 Sansome Place	2 Social Housing Units		2002	WCMC	Citizens Advice 2 Residents
40.**	Old Glove Factory(13 Lowesmoor)	Expertan		2006	WCMC	J Fiedorowicz & K Kumorowski
41.**	Old Glove Factory(13A, B)	Ofces		2006	WCMC	Citizens Advice
42.**	Old Glove Factory(15 Lowesmoor)	Shop		2006	WCMC	Sorin Pop
43.**AM#	St Albans, Deansway	Day Centre for the homeless		2009	WCMC	Maggs Day Centre
44.**s#	Tudor House, Friar Street	Heritage Centre /Museum		2008	WMEF	WHAT
46.#	Medway Road Community Centre	Ofces, Youth Club, Hall		2012	WMEF	All Sorts of Performing Arts
48.**	9 Sansome Place	6 Social Housing Units		2013	WCMC	Citizens Advice 6 Residents
49.	Land at Welland	45.1 acres arable land		1702	S & G	Mr Bullock - Life-Time tenancy
51.**#	21 The Cross	3 Social Housing Units		2014	WCMC	Citizens Advice 3 Residents
52.**	19 Foregate Street	Ofce		2015	WCMC	Dawn Salter, Gentle Changes
52A**	19 Foregate Street	6 Social Housing Units		2015	WCMC	Citizens Advice 6 Residents
53	59/60 The Tything	Charity Shop & Ofces		2016	WMC (CIO)	Maggs Day Centre
53A	59/60 The Tything	2 Social Housing Units		2016	WMC (CIO)	Citizens Advice 2 Residents

*** = Grade I Listed ** = Grade II Listed [s] = Grade II* Listed AM = Ancient Monument

# Leasehold - Properties are freehold except 19, 20, 28, 43, 44, 46 & 51

~ All property is vested in the CIO as Custodian Charity

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21. CONCLUSION AND COMMENT

• a) The ancient trusts now managed as Worcester Municipal Charities (CIO) were largely founded between 1559 and 1899, and originally came into being to provide almshouses, pensions, financial help for the poor, and education for the poor.

• b) A brief ancient history of the Charity and the Chapel is published separately. Please visit the web site or ask at the office for a copy.

• c) “While the World Endureth” a major history of the Charity since 1559 was published in 2020 and can be purchased from the office or viewed on the website.

  • d) In the 20th Century , after the creation of the Welfare State in the 1940s, the work of charities was realigned to fill some of the gaps left. Charities were free to concentrate on innovation - new work that, if successful, would probably eventually be taken over by the State, whose welfare provision was increasing year by year. Charities looked for the small “gaps” left by the Welfare State and filled them.

• e) Housing Benefit, State Pensions and Income Support brought by far the biggest change in the administration of Almshouse Charities as they meant that the money originally endowed for the provision of rent-free housing and pensions for residents became available for other purposes e.g. grant making and social investment.

• f) However, in the 21st Century the State began rolling back its traditional boundaries of support for citizens and spending less each year on welfare. Work, originally taken off charities, is now being handed back by the Health and Social Services in the wholly unrealistic expectation that it can all be done by volunteers, without any need for paid staff to recruit, DBS check, train, organise and support them. This strategy seems doomed to fail, and is already leading to the collapse of charities that were created during better financial periods.

• g) In 2013 the Government “Social Fund” which provided help to poor people in an emergency was all but wound up, and replaced in Worcester by the DWAS (Discretionary Welfare Assistance Scheme). The Charity agreed to act as agents for the Scheme and in 2020 bought white goods to the value of £116,637, thereby greatly reducing the number of grants requested from the Charity itself. The Charity won the tender to help continue the DWAS scheme until March 2021 when a review is planned.

• h) In 2014 Home-Start lost its County Council funding and was forced to dramatically down-size, relocate and rely wholly on its reserves to survive.

25

• i) In 2016 Worcestershire Lifestyles and ASHA were both forced to close due to a similar loss of County Council funding.

• j) The country does seem to be on a retrograde journey, back to the old Victorian welfare values of “help yourself or go without, try the food banks or charities”. The pace of this process has been accelerated by the recession, welfare cuts, the introduction of Universal Credit and the Government’s reductions in grant aid to Local Authorities who have cut grants to charities.

• k) The Corona Virus from 2020 onwards has deprived many charities of earned income and is forcing some of them out of business.

• l) On paper this principle of “self help and find a job” may be a laudable objective, but there will remain a rump of poor, often socially excluded, sometimes mentally impaired, perhaps addicted drug users, or alcohol abusers - people whose problem actually is an inability to help themselves no matter how hard they try, or who cannot try, because it is that inability that is their weakness.

• m) This Charity , and many others, will continue to do their best to help, but poverty, unemployment and homelessness are very much on the increase and beyond the resources of charities on their own.

• n) As well as offering help to individuals in need (£179,419 including DWAS), the Charity is also empowered to help organisations that provide help to them.

Pictured below Sir Thomas White Court, 10 new flats, built for the single homeless. Officially opened by Jabba Riaz the Mayor of Worcester and Robin Walker MP on Friday 16th November 2018.

Also pictured from left to right Martyn Saunders, WMC Vice Chair and Citizens Advice CEO Paul Griffith MBE, WMC Chair, Peter Jones from Homes England Frazer Bufton, Architect and Shaun Wood, Building Contractor.

Page 11 shows the 25 new flats planned for the homeless in 2021

Page 12 provides details of the grants made to organisations for The Period worth £333,000.00 .

Page 14 sets out the "Facility Gifts in Kind" to a number of charities valued at £101,254.00 for The Period.

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22. LEGISLATION, POLICIES, PROCEDURES, AND PRACTICES COMPLIANCE

The Charity confirms it has complied/is complying with the following:

GOVERNANCE

The Registered Constitution and Rules as amended The “Good Governance” Code for the Voluntary and Community Sector Checklist Risk Register established and reviewed annually Charity Commission’s “Public Benefit” Requirements Review of Trustees’ Skills and Knowledge audit and their pen picture profiles The Chairman’s Role and Job Description Trustees’ induction and training Trustees’ Code of Conduct Trustees’ Conflict of interest policy Trustees’ Declaration of Interests Trustees’ Expenses’ policy Trustees’ Register of Interests Equalities Legislation Equal Opportunities Policy Data Protection Act (registered) Environmental Policy Complaints Policy and Procedure

SOCIAL HOUSING - RETIREMENT & AFFORDABLE HOUSING FOR THE HOMELESS

Housing SORP applied to Annual Accounts

Homes England “STANDARDS” for: Home, Rent, Tenancy (Licence), Community Relations, Neighbourhood and Community, Value for Money (including Metrics) Retirement Almshouses Allocation Policy - 12 months residency qualification Housing Ombudsman Registration - extending licensees’ rights of complaint Worcester Citizens Advice Landlord and Agent “Smartlets” Agreement. Rent Arrears Protocol

FINANCES

Accounts Audited externally annually Annual Business Plan Annual Budget - Revenue & Capital separately Register of Assets and Liabilities - Maintain a current record of any new buildings under construction, together with any associated contractual liabilities to the contractors concerned. Financial Controls Policy including Value for Money & Metrics Financial Forecast Review Financial Viability Policy Insurance - Take out appropriate policies annually Reserves - Set aside suitable major reserves for capital projects - 10% revenue contingency

REVIEWS

A review of all policies, procedures, practices and compliance is completed annually

27

23. PRINCIPAL ADVISERS TO THE CHARITY

SOLICITORS

HallmarkHulme LLP 3-5 Sansome Place Worcester WR1 1UQ Tel. [phone]

BANKERS

Unity Trust Bank Plc Nine Brindley Place Birmingham, B1 2HB Tel. [phone]

ARCHITECTS

Lett and Sweetland, Architects 58 London Road Worcester, WR5 2DS

Tel. [phone]

COMMERCIAL VALUERS

GJS Dillon, Chartered Surveyors 7 Roman Way Business Centre Droitwich, WR9 9AJ

Tel. [phone]

ARC Surveyors Ltd

Adrian Robinson, MRICS Chartered Surveyors & Land Agents The Estate Office Madresfeld Malvern WR13 5AH Tel. [phone]

AUDITORS

Kendall Wadley LLP Granta Lodge 71 Graham Road Malvern WR14 2JS Tel. [phone]

TRUSTEES' APPROVAL

The foregoing Report of the Trustees, pages 1 - 28, was approved and signed on behalf of the Board of Trustees on 14 May 2021, together with the audited Accounts pages 29 - 57 and presented to their meeting on 26 May 2021.

PAUL GRIFFITH, MBE (Chairman)

MARTYN SAUNDERS (Vice-Chairman)

28

24. Audited Accounts

WORCESTER MUNICIPAL CHARITIES (CIO)

STATEMENT OF TRUSTEES RESPONSIBILITIES

FOR THE YEAR ENDED 31 DECEMBER 2020

The Trustees are responsible for preparing the Trustees Report 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 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 of the charity for that year.

In preparing these financial statements, the Trustees are required to:

• select suitable accounting policies and then apply them consistently;

• observe the methods and principles in the Housing SORP 2018 (FRS 102);

• make judge ements and estimates that are reasonable and prudent;

• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation.

The Trustees are responsible for keeping sufficient accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Housing SORP 2018 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.

29

WORCESTER MUNICIPAL CHARITIES (CIO)

INDEPENDENT AUDITOR'S REPORT

TO THE TRUSTEES OF WORCESTER MUNICIPAL CHARITIES (CIO)

Opinion

We have audited the financial statements of Worcester Municipal Charities (CIO) (the ‘charity’) for the year ended 31 December 2020 which comprise, the statement of comprehensive income, the statement of changes in reserves, the balance sheet, the statement of cash flows and the 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 FRS 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:

• give a true and fair view of the state of the charity’s affairs as at 31 December 2020 and of its incoming resources and application of resources, for the year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• have been prepared in accordance with the requirements of the Housing SORP 2018, 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 charity 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 Trustees 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 charity’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 Trustees 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 annual report other than the financial statements and our auditor's report thereon. The Trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and 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.

30

WORCESTER MUNICIPAL CHARITIES (CIO)

INDEPENDENT AUDITOR'S REPORT (CONTINUED) TO THE TRUSTEES OF WORCESTER MUNICIPAL CHARITIES (CIO)

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 (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

• the information given in the financial statements is inconsistent in any material respect with the Trustees r eport; or

• sufficient accounting records have not been kept; or

• the financial statements are not in agreement with the accounting records; or

• we have not received all the information and explanations we require for our audit.

In addition, we have nothing to report in respect of the following matter where the Housing and Regeneration Act 2008 requires us to report to you if, in our opinion:

• a satisfactory system of control over transactions has not been maintained

Responsibilities of Trustees

As explained more fully in the s tatement of Trustees r esponsibilities, 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. In preparing the financial statements, the Trustees are responsible for assessing the charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.

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. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below .

Extent to which the audit was considered capable of detecting irregularities including fraud

• an understanding of the risk assessment process (including the assessment of the risk of fraud) adopted by the Board is obtained and their attitude to risk ascertained

• an assessment of the susceptibility to material mis-statement of the financial statements as a result of management over-ride or fraud is made

• it is ensured that the engagement team have, collectively, the appropriate competence, capabilities and skills to be involved in the assignment, are fully briefed and understand the risks specific to the charity

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WORCESTER MUNICIPAL CHARITIES (CIO)

INDEPENDENT AUDITOR'S REPORT (CONTINUED) TO THE TRUSTEES OF WORCESTER MUNICIPAL CHARITIES (CIO)

Audit response to risks identfiied

The information obtained through the assessment to risk procedures is reviewed and the following work undertaken:

• processes to test the outcomes of our assessment include, a review of Board minutes, analytical review, the relevance and accuracy of significant accounting estimates, substantive testing of significant transactions, work to identify unusual or unexpected accounting entries including the testing of journal entries, information disclosed in the financial statements is traced to supporting documentation. In all instances it is acknowledged that material mis-statements that arise from fraud may involve deliberate concealment or collusion and are, therefore, by their very nature harder to detect than those arising from error.

• an understanding of the legal and regulatory framework as applicable to the charity is obtained together with knowledge of the procedures put in place by the charity in order to comply with the same

It should be noted that Auditing standards limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: http s :// www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Other matter s

Your attention is drawn to the fact that the charity has prepared financial statements 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 UK and Republic of Ireland (FRS 102)" (as amended) in preference to the Accounting and Reporting by Charities: Statement of Recommended Practice issued on 1 April 2005 which is referred to in the extant regulations but has now been withdrawn.

This has been done in order for the financial statements to provide a true and fair view in accordance with current Generally Accepted Accounting Practice.

Use of our report

This report is made solely to the charity’s trustees, as a body, in accordance with part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity's trustees those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Sarah Morley ACA (Senior Statutory Auditor) for and on behalf of Kendall Wadley LLP

14 May 2021

Chartered Accountants

Statutory Auditor

Granta Lodge 71 Graham Road Malvern Worcestershire WR14 2JS

Kendall Wadley LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under of section 1212 of the Companies Act 2006.

32

Total			2019	£		995,558	(988,519)	-	17,410	149,364	173,813	18,530		61,383		-		253,726
Unrestricted Unrestricted Restricted Endowment TotalUnrestricted Unrestricted Restricted Endowment	funds funds funds funds funds funds funds funds	general d esignated general d esignated	2020 2020 2020 2020 2020 2019 2019 2019 2019	Notes £ £ £ £ £ £ £ £ £	Income	Rental income 3 943,351 - - - 943,351 995,558 - - -	Operating costs 4 (920,184) (32,054) (116,636) - (1,068,874) (916,457) - (72,062) -	Other costs - - - - - - - - -	Other income 9,743 2,000 - - 11,743 17,410 - - -	Donations and grants received 5 24 - 866,673 - 866,697 103 - 149,261 -	Operating surplus 32,934 (30,054) 750,037 - 752,917 96,614 - 77,199 -	Interest receivable 11 21,148 - - - 21,148 18,530 - - -	Net gains/(losses) on	investments 12 23,746 - - (303,000) (279,254) 61,383 - - -	Unrealised (loss)/gain on housing 15	properties at revaluation - - - (2,404,631) (2,404,631) - - - -	Total comprehensive income	for the year 77,828 (30,054) 750,037 (2,707,631) (1,909,820) 176,527 - 77,199 -		Signed on behalf of the Trustees on 14 May 2021	............................................. .................................................	Paul Griffith MBE, Trustee Martyn Saunders, Trustee

33

		Total			2019	£			17,098,651		253,726	-		17,352,377
		Endowment	funds		2019	£			14,209,253		-	280,150		14,489,403
		Restricted	funds		2019	£			2,603		77,199	(79,802)		-
		Unrestricted Unrestricted	funds funds	general d esignated	2019 2019	£ £			2,591,795 295,000		176,527 -	(65,024) (135,324)		2,703,298 159,676
		Total			2020	£			17,352,377		(1,909,820)	-		15,442,557
		Endowment	funds		2020	£			14,489,403		(2,707,631)	1,473,068		13,254,840
STATEMENT OF CHANGES IN RESERVES	FOR THE YEAR ENDED 31 DECEMBER 2020	Unrestricted Unrestricted Restricted	funds funds funds	general d esignated	2020 2020 2020	Notes £ £ £	Fund balances at 1	January 2019 as	restated 2,703,298 159,676 -	Total comprehensive	income 77,828 (30,054) 750,037	Transfers 13 (725,031) 2,000 (750,037)	Fund balances at 31	December 2020 2,056,095 131,622 -

34

WORCESTER MUNICIPAL CHARITIES (CIO)

BALANCE SHEET

AS AT 31 DECEMBER 2020

	2020 2019 Notes £ £ £ £ Fixed assets Tangible assets 15 6,905,066 7,750,524 Investment properties 16 7,632,000 7,930,001 Investments 17 408,885 390,139 14,945,951 16,070,664 Current assets Debtors 19 139,199 119,624 Investments 20 - 39,907 Cash at bank and in hand 663,341 1,347,006 802,540 1,506,537 Creditors: amounts falling due within one year 21 (305,934) (224,824) Net current assets 496,606 1,281,713 Total assets less current liabilities 15,442,557 17,352,377 Capital funds Endowment funds 23 13,254,840 14,489,403 Income funds Unrestricted funds-general Designated funds 25 131,622 159,676 General unrestricted funds 2,056,095 2,703,298 2,187,717 2,862,974 15,442,557 17,352,377 The financial statements were approved by the Trustees on 14 May 2021 ................................. .................................. Paul Griffith MBE, Trustee Martyn Saunders, Trustee

35

WORCESTER MUNICIPAL CHARITIES (CIO)

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2020

2020 Notes £ £ Cash flows from operating activities Cash generated from operations 29 855,452 Investing activities Purchase of tangible fixed assets (1,560,265) Purchase of investment property - Proceeds on disposal of other investments - Interest received 21,148 Net cash used in investing activities (1,539,117) Net cash used in financing activities - Net decrease in cash and cash equivalents (683,665) Cash and cash equivalents at beginning of year 1,347,006 Cash and cash equivalents at end of year 663,341

2019 £ £ 166,488 (140,659) (140,324) (491) 18,530 (262,944) - (96,456) 1,443,462 1,347,006

36

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020

1 Accounting policies

Charity information

Worcester Municipal Charities is a Charitable Incorporated Organisation (CIO) and a private registered provider of social housing in the United Kingdom. The address of the registered office is Kateryn Heywood House, Berkeley Court, The Foregate, Worcester, WR1 3QG.

The nature of the charity's operations and principal activities are: helping Worcester City people in financial need by providing grants of essential items or services not provided for by the state. Assisting organisations who help Worcester City people in need. Provision of affordable social housing in Worcester City. The promotion of education to those in need from The City of Worcester, The parishes of Powick, Bransford, Rushwick and The Ancient Parish of Leigh.

1.1 Accounting convention

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.

The charity is a Public Benefit Entity as defined by FRS 102.

The financial statements are prepared in sterling , which is the functional currency of the charity. Monetary a mounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2 Going concern

At the time of approving the financial statements, the Trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future. Thus the Trustees continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3 Charitable funds

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of their charitable objectives.

Restricted funds are subject to specific conditions by donors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.

Endowment funds are subject to specific conditions by donors that the capital must be maintained by the charity.

1.4 Incoming resources

Income is recognised when the charity is legally entitled to it after any performance conditions have been met, the amounts can be measured reliably, and it is probable that income will be received.

Cash donations are recognised on receipt. Other donations are recognised once the charity has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.

37

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

1 Accounting policies

(Continued)

Legacies are recognised on receipt or otherwise if the charity has been notified of an impending distribution, the amount is known, and receipt is expected. If the amount is not known, the legacy is treated as a contingent asset.

Rental income is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, VAT and other sales related taxes.

1.5 Resources expended

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation n committing the charity to that expenditure, it is probable that settlement will be required and the amount of the obligation can be measured reliably.

All expenditure is included on an accruals basis, inclusive of any VAT which cannot be recovered, and has been classified under headings that aggregate all costs related to tha t category.

Grants payable are payments made to third parties in the furtherance of the charitable objects of the charity. Where unconditional grants are offered, this is accrued as soon as the recipient is notified of the grant, as this gives rise to a reasonable expectation that the recipient will receive the grants. Where grants are conditional relating to the performance then the grant is only accrued when any unfulfilled conditions are outside of the control of the charity.

1.6 Tangible fixed assets

Social housing properties are stated at cost (or deemed cost) or valuation less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended such as the cost of acquiring land and buildings, developments costs, interest charges on loans during the development period and expenditure on improvements.

Expenditure on improvements will only be capitalised when it results in incremental future benefits such as increasing rental income, reducing maintenance costs or resulting in a significant extension of the useful economic life of the property.

Land and other assets donated by local authorities and other government sources related to a specific development is added to cost at the fair value of the land at the time of the donation.

Freehold land is not depreciated. Housing properties under construction are not depreciated until they are in use and the useful economic lives of all tangible fixed assets are reviewed annually.

Other tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures and fittings 10% reducing balance Office equipment 20% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in net income/(expenditure) for the year.

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WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

1 Accounting policies (Continued)

1.7 Investment properties

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in profit or loss.

It is the charity’s policy to revalue the properties every five years, with revaluation gains and losses recognised in the statement of financial activities in accordance with the SORP. The basis of valuation is for a continuing existing use or the open market value for investment purposes or disposal of sale whichever is appropriate.

1.8 Fixed asset investments

Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in net income/(expenditure) for the year . Transaction costs are expensed as incurred.

1.9 Impairment of fixed assets

At each reporting end date, the charity reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any ) .

1.10 Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less .

1.11 Financial instruments

The charity has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the charity's balance sheet when the charity becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

39

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2020

1 Accounting policies

(Continued)

Basic financial liabilities

Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future p aymen ts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the charity’s contractual obligations expire or are discharged or cancelled.

1.12 Employee benefits

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

1.13 Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

2 Critical accounting estimates and judgements

In the application of the charity’s accounting policies, the Trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

40

					Total	2019		£	968,774	26,784	995,558
					Investment	properties	2019	£	568,710	21,121	589,831
					Sheltered Social housing	housing	2019 2019	£ £	224,785 175,279	5,663 -	230,448 175,279
					Total	2020		£	924,662	18,689	943,351
					Investment	properties	2020	£	500,535	13,994	514,529
WORCESTER MUNICIPAL CHARITIES (CIO)		NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)	FOR THE YEAR ENDED 31 DECEMBER 2020	3 Rental income	Sheltered Social housing	housing	2020 2020	£ £	Charitable rental income 221,310 202,817	Service charges 4,695 -	226,005 202,817

41

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

4 Operating costs

Staff costs Bad debt provision Welfare costs Routine maintenance Heat and power Rates Management costs Unreimbursed costs Cleaning and hygiene Grant funding of activities (see note 6) Share of support costs (see note 7) Share of governance costs (see note 7) Analysis by fund Unrestricted funds - general Unrestricted funds - designated Restricted funds	Grant making 2020 £ 11,972 - - - - - - - - 11,972 512,417 102,616 3,019 630,024 513,388 - 116,636 630,024	Sheltered housing 2020 £ 41,599 - 9,694 56,041 22,877 11,452 - - 2,107 143,770 - 26,760 787 171,317 171,317 - - 171,317	Social housing Investment properties 2020 2020 £ £ - - - 11,167 - - 28,495 100,075 1,743 - - - 30,423 - - 8,195 - - 60,661 119,437 - - 24,014 60,922 707 1,792 85,382 182,151 85,382 150,097 - 32,054 - - 85,382 182,151	Total 2020 £ 53,571 11,167 9,694 184,611 24,620 11,452 30,423 8,195 2,107 335,840 512,417 214,312 6,305 1,068,874 920,184 32,054 116,636 1,068,874	Total 2019 £ 52,927 - 10,478 153,734 24,438 11,819 26,292 20,646 2,197 302,531 447,861 226,301 11,826 988,519 916,457 - 72,062 988,519

42

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

4 Operating costs

(Continued)

For the year ended 31 December 2019

Grant making Shelterd housing Social housing Investment properties £ £ £ £ Staff costs 11,659 41,268 - - Welfare costs - 10,478 - - Repairs - 73,548 38,489 41,697 Heat and power - 23,169 1,269 - Rates - 11,819 - - Management costs - - 26,292 - Unreimbursed costs - - - 20,646 Cleaning and hygiene - 2,197 - - 11,659 162,479 66,050 62,343 Grant funding of activities (see note 6) 447,861 - - - Share of support costs (see note 7) 30,085 46,303 35,218 114,695 Share of governance costs (see note 7) 1,572 2,420 1,840 5,994 491,177 211,202 103,108 183,032 Analysis by fund Unrestricted funds - general 419,115 211,202 103,108 183,032 Restricted funds 72,062 - - - 491,177 211,202 103,108 183,032 5 Donations and grants received Unrestricted Restricted TotalUnrestricted Restricted funds funds funds funds general general 2020 2020 2020 2019 2019 £ £ £ £ £ Donations and gifts 24 - 24 103 - Grants received - 866,673 866,673 - 149,261 24 866,673 866,697 103 149,261

Total 2019 £ 52,927 10,478 153,734 24,438 11,819 26,292 20,646 2,197 302,531 447,861 226,301 11,826 988,519 916,457 72,062 988,519 Total 2019 £ 103 149,261 149,364

43

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

6 Grants awarded

Grants to institutions: Maggs Day Centre CAB/ WHABAC Armchair Shopmobility Worcester Community Trust Tudor House Museum (WHAT) WAY Dancefest All Sorts of Performing Arts John Palmer Grants to individuals 204 grants) Relief in need and carpets Educational White goods DWAS Grants paid in the year Grants paid to institutions Grants paid to individuals	Grant making 2020 £ 29,645 173,381 16,444 7,000 38,480 36,168 - 17,260 13,672 950 333,000 50,138 1,200 11,444 116,637 512,417 443,732 40,457 484,189	Grant making 2019 £ 28,838 168,658 15,995 7,000 18,432 35,183 21,174 10,790 10,000 950 317,020 47,920 1,121 9,738 72,062 447,861 392,116 58,131 450,247

44

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

• 7 Support costs

Support costs Governance costs £ £ Staff costs 59,315 - Depreciation 1,093 - Office running costs 6,266 - Accountancy 8,377 - Bank charges and subscriptions 892 - IT and software 3,451 - Sundries 10,398 - Irrecoverable VAT 44,762 - Telephone 2,128 - Insurance 39,403 - Business manager fees 11,679 - Surveyor fees 25,879 - Legal & professional 669 - Audit fees - 5,858 Meeting expenses - 447 214,312 6,305 Analysed between Charitable activities 214,312 6,305	2020 £ 59,315 1,093 6,266 8,377 892 3,451 10,398 44,762 2,128 39,403 11,679 25,879 669 5,858 447 220,617 220,617	2019 Basis of allocation £ 58,869_Charitable activities_ 1,378_Charitable activities_ 7,324_Charitable activities_ 10,244_Charitable activities_ 1,182 Charitable activities 3,041_Charitable activities_ 6,039_Charitable activities_ 52,382_Charitable activities_ 3,799_Charitable activities_ 32,963_Charitable activities_ 18,715_Charitable activities_ 29,701_Charitable activities_ 1,574_Charitable activities_ 8,364_Governance_ 2,552_Governance_ 238,127 238,127

8 Auditor's remuneration

Governance costs includes payment to the auditors of £ 5,858 (201 9 £ 8,364 ) for audit fees.

9 Trustees

None of the Trustees (or any persons connected with them) received any remuneration or benefits from the charity during the year.

45

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

10 Employees

Number of employees

The average monthly number of employees during the year was:

	2020	2019
	Number	Number
Support	3	3
Warden	2	2
	5	5
Employment costs	2020	2019
	£	£
Wages and salaries	103,688	101,637
Social security costs	3,779	5,036
Other pension costs	5,419	5,123
	112,886	111,796

There were no employees whose annual remuneration was £60,000 or more.

11 Investments

	Unrestricted	Unrestricted
	funds	funds
	general	general
	2020	2019
	£	£
Income from listed investments	10,594	10,383
Interest receivable	10,554	8,147
	21,148	18,530

46

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

12 Net gains/(losses) on investments

	Unrestricted	Endowment	Total	Unrestricted
	funds	funds		funds
	general			general
	2020	2020	2020	2019
	£	£	£	£
Revaluation of investments	18,746	-	18,746	61,383
Revaluation of investment properties	5,000	(303,000)	(298,000)	-
	23,746	(303,000)	(279,254)	61,383

13 Transfers

During the year transfers were effected from the unrestricted and restricted funds to reflect the expenditure incurred on the development of 3/4 Shaw Street into affordable accommodation. In addition £2,000 was transferred from unsrestricted funds to designated fund for use on Tudor House projects.

The transfers in the prior year related to:

£135,324 being transferred from designated funds to unrestricted funds to account for funds designated by the Trustees in relation to the Tudor House and Shaw Street projects.

£198 being transferred from unrestricted funds to restricted funds to account for overspends on the DWAS project.

£80,000 being transferred from restricted funds to endowment funds for grant monies spent towards 8 Sansome Place.

£280,150 being transferred from unrestricted funds to endowment funds to account for additions made to endowment property during the course of year.

47

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

14 Accommodation owned, managed and in development

Number of units Number of units at 1 Jan 2020 at 31 Dec 2020

Social housing General needs housing: Let at social rent Affordable rent Supported housing Total owned and managed Accommodation in development	- 39 32 71 25	- 39 32
		71
		25

Net surplus from social and sheltered housing

Rental income Service charges Operating costs Staff costs Routine maintenance Welfare Heat and light Rates Cleaning and hygiene Management cost Administrative expenditure Share of support costs Share of governance costs Net surplus / (deficit)	2020 Social Sheltered 202,817 221,310 - 4,695 202,817 226,005 - (41,599) (28,495) (56,041) - (9,694) (1,743) (22,877) - (11,452) - (2,107) (30,423) - (24,014) (26,760) (707) (787) 117,435 54,688	2019 Social Sheltered 175,279 224,785 - 5,663 175,279 230,448 - (41,268) (38,489) (73,548) - (10,478) (1,269) (23,169) - (11,819) - (2,197) (26,292) - (35,218) (46,303) (1,840) (2,420) 72,171 19,246

48

15 Tangible fixed assets	Sheltered Social housing Asset under Fixtures and Office Total	housing construction fittings equipment	social housing	£ £ £ £ £ £	Cost	At 1 January 2020 3,039,716 3,546,179 1,158,508 4,531 7,057 7,755,991	Additions - 18,693 1,541,535 - 37 1,560,265	Revaluation 80,284 (1,034,872) (1,450,043) - - (2,404,631)	At 31 December 2020 3,120,000 2,530,000 1,250,000 4,531 7,094 6,911,625	Depreciation and impairment	At 1 January 2020 - - - 1,551 3,916 5,467	Depreciation charged in the year - - - 298 794 1,092	At 31 December 2020 - - - 1,849 4,710 6,559	Carrying amount	At 31 December 2020 3,120,000 2,530,000 1,250,000 2,682 2,384 6,905,066		At 31 December 2019 3,039,716 3,546,179 1,158,508 2,980 3,141 7,750,524		The carrying value of land included in land and buildings comprises:	2020 2019	£ £	Freehold 4,370,000 4,198,224	Long leasehold 2,530,000 3,546,179	6,900,000 7,744,403

49

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

16 Investment property Commercial properties Social investment properties Social investment properties Freehold Freehold Leasehold Fair value At 1 January 2020 6,745,001 850,000 335,000 Additions 7,199 - - Net gains or losses through fair value adjustments (310,200) - 5,000 At 31 December 2020 6,442,000 850,000 340,000	2020 £ 7,930,001 7,199 (305,200) 7,632,000

Investment property comprises commercial and social investment properties. The fair value of the investment property has been arrived at on the basis of a quinquennial property valuation exercise carried out in December 2020. The commercial properties were valued by Guise Jones Sawyer and the agricultural properties by ARC Surveyors.

The valuations was made on an open market value basis by reference to market evidence of transaction prices for similar properties.

50

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

17 Fixed asset investments

Cost or valuation At 1 January 2020 Valuation changes At 31 December 2020 Carrying amount At 31 December 2020 At 31 December 2019 18 Financial instruments Carrying amount of financial assets Instruments measured at fair value through profit or loss 19 Debtors Amounts falling due within one year: Trade debtors Other debtors Prepayments and accrued income Amounts falling due after more than one year: Other debtors Total debtors 20 Current asset investments Unlisted investments	Listed investments £ 390,139 18,746 408,885 408,885 390,139 2020 2019 £ £ 408,885 430,046 2020 2019 £ £ 107,295 89,989 235 235 30,220 27,716 137,750 117,940 2020 2019 £ £ 1,449 1,684 139,199 119,624 2020 2019 £ £ - 39,907	Listed investments £ 390,139 18,746 408,885 408,885 390,139 2020 2019 £ £ 408,885 430,046 2020 2019 £ £ 107,295 89,989 235 235 30,220 27,716 137,750 117,940 2020 2019 £ £ 1,449 1,684 139,199 119,624 2020 2019 £ £ - 39,907
		408,885
		408,885
		390,139
		2019 £ 430,046
		2019 £ 89,989 235 27,716
		117,940
		2019 £ 1,684
		119,624
		2019 £ 39,907

51

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2020

21 Creditors: amounts falling due within one year

Notes Other taxation and social security Deferred income 22 Grants payable Other creditors Accruals and deferred income	2020 £ 8,135 103,232 78,693 95,297 20,577 305,934	2019 £ 11,851 102,983 45,306 50,506 14,178 224,824

22 Deferred income

	2020	2019
	£	£
Arising from rents paid in advance	103,232	102,983

All the above relate to the following period and are released in full.

52

23 Endowment funds	Endowment funds represent assets which must be held permanently by the charity , principally property.	Income arising on the endowment funds can be used in accordance with the objects of the charity and is included as unrestricted income. Any capital gains or	losses arising on the assets form part of the fund will be used to acquire further freehold property.	Movement in funds as restated Movement in funds	Balance at Incoming Resources Transfers Revaluations Balance at Incoming Resources Transfers Revaluations Balance at	1 January 2019 resources expended gains and 1 January 2020 resources expended gains and 31 December	losses losses 2020	£ £ £ £ £ £ £ £ £ £ £	Permanent endowments	Endowed funds 14,209,253 - - 280,150 - 14,489,403 - - 1,473,068 (2,707,631) 13,254,840	14,209,253 - - 280,150 - 14,489,403 - - 1,473,068 (2,707,631) 13,254,840

53

24 Restricted funds	The income funds of the charity include restricted funds comprising the following unexpended balances of donations and grants held on trust for specific purposes:	Movement in funds as restated Movement in funds	Balance at Incoming Resources Transfers Balance at Incoming Resources Transfers Balance at	1 January 2019 resources expended 1 January 2020 resources expended 31 December	2020	£ £ £ £ £ £ £ £ £	DWAS 2,603 69,261 (72,062) 198 - 116,673 (116,636) (37) -	Homes England - 80,000 - (80,000) - 750,000 - (750,000) -	2,603 149,261 (72,062) (79,802) - 866,673 (116,636) (750,037) -		DWAS scheme - A contract with City Council to manage the purchase and distribution of white goods in Worcester as part of the Discretionary Welfare Assistance	Scheme (DWAS).	Homes England - Homes England provided a grant this year in respect to the development of 3/4 Shaw Street (2019 -8 Sansome Place).

54

WORCESTER MUNICIPAL CHARITIES (CIO)	NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)	FOR THE YEAR ENDED 31 DECEMBER 2020	25 Designated funds	The income funds of the charity include the following designated funds which have been set aside out of unrestricted funds by the trustees for specific purposes:	Movement in funds	Balance at Transfers Balance at Incoming Resources Transfers Balance at	1 January 2019 1 January 2020 resources expended 31 December	2020	£ £ £ £ £ £ £	Shaw Street 250,000 (140,324) 109,676 - - - 109,676	Tudor House 45,000 5,000 50,000 2,000 (32,054) 2,000 21,946	295,000 (135,324) 159,676 2,000 (32,054) 2,000 131,622		26 Analysis of net assets between funds	Unrestricted Designated Restricted Endowment TotalUnrestricted Designated Restricted Endowment Total	2020 2020 2020 2020 2020 2019 2019 2019 2019 2019	£ £ £ £ £ £ £ £ £ £	Fund balances at 31	December 2020 are	represented by:	Tangible assets 5,066 - - 6,900,000 6,905,066 6,121 - - 7,744,403 7,750,524	Investment properties 1,190,000 - - 6,442,000 7,632,000 1,185,001 - - 6,745,000 7,930,001	Investments 408,885 - - - 408,885 390,139 - - - 390,139	Current assets/(liabilities) 452,144 131,622 - (87,160) 496,606 1,122,039 159,676 - - 1,281,713	2,056,095 131,622 - 13,254,840 15,442,557 2,703,300 159,676 - 14,489,403 17,352,377

55

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

27	Capital commitments	2020	2019
		£	£
	At 31 December 2020 the charity had capital commitments as follows:
	Contracted for but not provided in the financial statements:
	Acquisition of property, plant and equipment	850,152	26,215

28 Related party transactions

The Charity provided rent-free offices with an estimated rental value of £55,440 (2019 - £37,360) to CAB/ WHABAC and was also charged by them 15% of licence payments in respect of management fees for managing the Charity's social housing. The charity also provided grants of £173,381 (2019 - £168,658) to CAB/WHABAC towards its running costs. Paul Griffith and Graham Hughes, are trustees of this charity and of CAB/WHABAC. Martyn Saunders and Geraint Thomas are trustees of this Charity and employees of CAB/WHABAC

The Charity provided rent-free offices, a day centre and "free clothes" store with estimated rental values of £24,000 (2019 - £39,850) and also made a grant of £30,014 (2019 - £28,838) to Maggs Day Centre. Sue Osborne is a Trustee of this charity and of Maggs Day Centre. Mel Kirk is a trustee of this charity and an employee of Maggs Day Centre

The Charity provided a subsidised warehouse and offices to Armchair for which a reduced premium of £55,000 (2019 - £55,000) was paid to the WCMC predecessor charity for a 50 year lease in 1996. Margaret Jones, Mel Kirk, Sue Osborne, Martyn Saunders and Richard Boorn are trustees of this charity and of Armchair.

The Charity provided a rent-free Heritage Museum (Tudor House) with an estimated rental value of £8,000 (2019 - £7,000) and also made a grant over two years of £36,168 (2019 - £35,183) to the Worcester Heritage and Amenity Trust. Margaret Panter is a Trustee of this charity and of the Worcester Heritage and Amenity Trust.

The Charity received a payment of £8,193 (2019 - £7,864) from Laslett's Charities for the provision of administrative support and an office and facilities for the Clerk. Margaret Jones is a trustee of this Charity and of Laslett's Charities.

Remuneration of key management personnel

The remuneration of key management personnel is as follows.

	2020	2019
	£	£
Aggregate compensation	112,885	111,795

56

WORCESTER MUNICIPAL CHARITIES (CIO)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2020

29 Cash generated from operations 2020 £ (Deficit)/surpus for the year (1,909,820) Adjustments for: Investment income recognised in statement of financial activities (21,148) Fair value gains and losses on investment properties 298,000 Fair value gains and losses on investments (18,746) Depreciation and impairment of tangible fixed assets 1,093 Revaluation assets 2,404,632 Movements in working capital: (Increase) / decrease in curent asset investments 39,907 (Increase)/decrease in debtors (19,578) Increase in creditors 80,863 Increase/(decrease) in deferred income 249 Cash generated from operations 855,452

2019 £ 253,726 (18,530) - (61,383) 1,378 - - 12,125 17,388 (38,216) 166,488

57

The Old Glove Factory - Grade II listed building - built 1691 Now occupied commercially by Expertan and Barber, Sorin Pop with the Charity providing the rest of the property to Citizens Advice Worcester rent free.

58

Nash's and Wyatt's Almshouses - The original almshouses of John Nash (New Street 1661) and Michael Wyatt (Friar Street 1775) were both condemned as part of the infamous "slum clearances" of the 1960s and rebuilt together on the New Street site in 1964

59

A R 2 0 2 0

Maggs Day Centre for the Homeless

St. Alban's Chapel Grade 2 Listed Building & Ancient Monument provided rent free by the Charity

Tudor House Museum

Grade 2* Listed Building Let to Worcester Heritage & Amenity Trust Ltd on a Peppercorn rent

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