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2021-03-31-accounts

  1. SW9 Annual Accounts 2020- 21 FOR SIGNING

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SW9 COMMUNITY HOUSING

(A company limited by guarantee)

REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2021

(Charity No. 1170586) (Company No. 09574528)

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SW9 COMMUNITY HOUSING

FINANCIAL STATEMENTS

For the year ended 31 March 2021

Page
The Trustees, Executive Officer and Advisors 1
Report of the Trustees Including Strategic Report 2 – 25
Independent Auditor’s Report 26 – 29
Statement of Financial Activities 30
Statement of Financial Position 31
Notes to the Financial Statements 32 – 47

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SW9 COMMUNITY HOUSING

THE TRUSTEES, EXECUTIVE OFFICER AND ADVISORS

The members of SW9 Community Housing are its Trustees for the purpose of charity law. The Trustees, executive officer, and advisors who were in office during the year and up to the date of signing the financial statements were:

Trustees Dee Alapafuja
Adebayo Ajibade
Andrew Sternberg
Benjamin Peart
Colin Faulkner (appointed 19 May2020)
Daniel Cromb
Daniel Garza
Joshua Lindsey (resigned 23 April 2021)
Kieran Godwin (appointed 15 Jun 2021)
Olukayode Ajisebutu
Paul Brett
Sarah Thomas (resigned 1 April 2020)
Steven Warren
Tazeem Abbas (appointed 8 July 2021)
Secretary Sarah Patrice
Executive Officer Delroy Rankin
Registered office 6 Stockwell Park Walk
London SW9 0FG
Independent auditor BDO LLP
Chartered Accountants and Statutory Auditors
55 Baker Street
London W1U 7EU
Solicitors Anthony Collins Solicitors LLP
134 Edmund Street
Birmingham B3 2ES
Bankers HSBC
West End Business Banking Centre,
16 King Street
Covent Garden,
London WC2E 8JF
Registrations Company No. 09574528
Charity No. 1170586

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SW9 COMMUNITY HOUSING

REPORT OF THE TRUSTEES (INCLUDING STRATEGIC REPORT) FOR THE YEAR ENDING 31 MARCH 2021

The Trustees are pleased to present their annual Directors’ report together with the financial statements of the Charity of the year ending 31 March 2021 which are also prepared to meet the requirements for a Directors’ Report and accounts for Companies Act purposes.

The financial statements comply with the Charities Act 2011, the Companies Act “2006”, the Memorandum and Articles of Association, and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).

Chair’s report

Over the past year, and indeed currently, we continue to live through a significant chapter in world history. The pandemic has touched each, and every one of us, as we have been separated from the people we care about and care for, physically dissociated from friends and colleagues, with repeated lockdowns and social distancing. On behalf of the Trustees, I should first like to honour and pay our deepest respects to those who have lost their lives or loved ones through the pandemic, SW9 residents, colleagues, and all members of the community in which we live and work. With these sombre thoughts in mind, I want to thank all our residents, both old and new, who have got involved with the Charity during this last financial year.

SW9 is a community and by getting involved with our engagement activities on offer, residents can develop a direct relationship with the organisation, give feedback on our services, and have their say in how they should be delivered.

I am proud of the range of activities SW9 has delivered for residents, the vast majority of which are delivered for free and are oriented around giving families opportunities they may not normally have access to. We also work hard to give individuals chances to develop personally, supporting both their future and that of their families.

Whether by attending an event, giving feedback on a service, or volunteering with a resident group, more than 230 residents have had their say in what SW9 does and how we do it.

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SW9 COMMUNITY HOUSING

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Chair’s report (continued)

If you have joined SW9 during the last year, either as a tenant or a leaseholder, I would like to extend a very warm welcome to you as you join your new community. Stockwell is an exciting place to live and, as the regeneration progresses, many new residents will choose to make this community their home. This regeneration is only possible through the continued support of Network Homes, and I thank them for their sustained commitment.

Even though SW9 is familiar with facing challenges in a changing business environment, the ongoing pandemic is unprecedented in our lifetimes. SW9’s operations adapted well, and our staff have responded courageously, enabling the organisation to continue to deliver core services, and support our vulnerable residents during this time. That said, we do not underestimate the long-term impact on the general economy and society.

In closing I would like to thank my fellow trustees particularly welcoming our new members, the management, and staff of the charity for all their hard work and dedication to the estate and surrounding street properties. To find out more about how we are “keeping it local”, please visit our website www.sw9.org.uk or telephone 0207 326 3700.

Our residents are the reason we are here.

Yours, Dee Alapafuja Chair

SW9 Community Housing

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SW9 COMMUNITY HOUSING

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Our purpose and activities

The purposes of the Charity are:

The principal activity of SW9 Community Housing (“the charitable company”/” the Charity”) is to provide property management and maintenance services on behalf of Network Homes Limited, the Landlord, under a 25-year Management Agreement. In accordance with the Management Agreement between the charitable company and Network Homes Limited, one of the key purposes is to deliver first class housing, support and repairs services to the residents of Stockwell Park and surrounding street properties, as defined by the Charity’s Area of Benefit.

To do this, the charitable company retains a percentage of the annual rental income paid by tenants living in properties under the management of the charitable company. The accommodation provided is for people on low or moderate incomes, and in housing need. The accommodation under the management of the charitable company ranges from single person accommodation up to large family dwellings. The charitable company also manages purpose-built specialist accommodation for those in need of support or personal care. It also provides community development and community engagement to ensure Stockwell Park remains a sustainable and vibrant multicultural environment.

The charitable company also provides services to tenants who have purchased their home on a long lease, either on a shared ownership basis or outright at market value.

The total number of homes under the management of the charitable company is 1,718 of which, 900 are for general needs, 630 are leasehold homes, 65 are shared ownership properties while 48 are supported housing. 40 are classed as older persons’ housing and 3 are affordable rent. This number will increase in 2021-22 as further new homes are built on Stockwell Park by Network Homes Limited, a Registered Provider with Homes England, and parent company to the charitable company.

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The vision that shapes the charitable company’s activities remains the promotion of tenant management, and local control and accountability. The charitable company encourages tenants and residents to actively influence the services provided through membership of its Trustee board, residents’ forums, and community development groups.

The charitable company also has the general charitable aim of contributing to the quality of life of tenants of the Stockwell Park Estate and surrounding street properties by expanding their horizons through the provision of exciting, challenging and accessible activities including employment and welfare advice through signposting tenants to stakeholder partners.

The charitable company endeavours to encourage all within the community to take part in activities and attend community events held throughout the year, irrespective of tenure type. These activities are either free or subsidised to ensure they are affordable and available to all.

The charitable company continues to foster links with other local organisations which provide additional services to the residents of Stockwell Park and surrounding street properties. The charitable company recognises the positive contribution other organisations can make to further its aims and objectives in particular, for those most vulnerable residents.

Volunteers

Members of the Board of Directors and Committees did not receive any remuneration for the work they carried out in the capacity of the charitable company in the year ending 31 March 2021. In addition, a number of residents and friends of the charitable company gave their time voluntarily in assisting with specific projects and community activities, including the packing of hampers for vulnerable residents.

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Achievement and performance

The charitable company provided a variety of related services to 1,718 homes. The number of homes according to tenure type is shown below:

General needs: 900
Leaseholders: 630
Shared Ownership: 65
Supported Housing: 48
Older Persons’ Housing: 40
Affordable Rent: 35

Due to the pandemic impacts on the general economy and the continued rollout of Universal Credit, net rental income as a percentage of rents owed fell to 96.64% in the financial year ending 31 March 2021. To help support those experiencing financial difficulty, the charitable company invested resources to help 77 residents and, as a direct result of early intervention, there were no evictions for the non-payment of rent. The percentage of tenants in arrears remains under 2%. This places the Charity in the top five London based social housing providers.

The focus of the charitable company remains the provision and delivery of quality housing services and community engagement and development. Improving levels of customer satisfaction is the major priority and the year ending 31 March 2021 was another year of continuous improvement, with an increase of 4% to 76%.

Performance in other areas continued to improve for the period ending 31 March 2021. Although the number of days taken to re-let an empty property had almost doubled to 53.9 days, this was largely due to the switch to a new main repairs contractor combined with the high number of voids created by new Thrayle House.

The charitable company monitors all expenditure, particularly repairs and maintenance which is the largest single budget. During the year under review the Charity signed a three-year contract with Seville

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Achievement and performance (continued)

Developments Limited to deliver responsive repair services to the properties under management, replacing Chigwell (London) who had been the principal repairs contractor for the previous 12 months.

Post the Grenfell tragedy, the social housing sector has continued to emphasise the need for Health and Safety compliance, particularly in terms of fire safety. The charitable company has continued to work alongside Network Homes Limited (the landlord) to improve fire safety measures at a number of the residential buildings under its management. Recladding works have commenced at Park Heights, a fifteen and twenty storey tower block. A further building is due to undergo cladding replacement works during 2021-22. The cost of these works will be paid for by Central Government. 100% of the properties under the management have a valid Fire Risk Assessment.

A number of community benefit projects or events were delivered by the charitable company. Some of the key achievements are set out below:

Throughout the year ending 31 March 2021, 235 residents actively took part in a community event or project. In total there were 898 instances of engagement, meaning many residents got involved with the Charity on more than one occasion. Although these figures are down on the previous financial year, they are still remarkably healthy given that, like the rest of the UK, Stockwell Park has been under governmentimposed lockdown measures for much of the year.

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Community Engagement

During the financial year 2020-21, 235 (483 in 2019-20) individuals took part in engagement activities with the charitable company. This is a strong number for an organisation the size of SW9 and, although it is down on the figure from the previous financial year (483), remains impressive given the constraints of delivering the service within the restrictions and repeated lockdowns of the pandemic.

The individuals engaged via a total of 899 instances during this period, showing that many residents chose to take part in more than one activity. Although this is also down on the previous year (1598), it reflects the trust that our residents had in us to deliver quality activities in a Covid-safe environment, with a huge number returning time and again.

The year under review was given an immeasurable boost to the service by Komal Doan, SW9’s first Resident Engagement and Communications Manager. Arriving at SW9 with an exciting new vision for the service and how it should respond to the pandemic, in total she delivered a staggering 93 engagement activities during 2020-21 despite not arriving until well into the financial year. These included, but were not limited to:

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Community Engagement (continued)

In addition, the following activities were also delivered:

New opportunities developed in this period include the SW9 Improvement Panel and Secret Shopping programme, which will deliver the organisation’s scrutiny function. These will begin operation in the coming financial year.

Close contact is maintained with the Community Centre, run by the Community Trust, as well as our partners at Network Homes, with regular meetings held to discuss ways in which we can better support each other and deliver projects of shared importance.

Financial Review

The main source of income reported by the charitable company for the year ending 31st March 2020 on its charitable activities was £8,675k (2020: £8,029k).

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Financial Review (continued)

Total expenditure in the year was £8,302k (2020: £7,943K), of which £1,100k was charged to the Statement of Financial Activities under major repairs and routine maintenance.

The second highest area of expenditure for the charitable company is Employee Costs. Employees are key to the ongoing success of the business and therefore the Trustee’s will continue to approve expenditure for investment in staff development. Employee costs account for 18% of expenditure.

The charitable company recorded a surplus of £373k during the year, which was a significant improvement over the previous year (2020: £88k). There have been increases in repairs and maintenance costs as well as service costs in the year.

The charitable company is financed using its positive cash flow and retained reserves, which are not distributable. The charitable company has no loan facilities from banks or other lending institutions. The trustees consider the charitable company has the capacity to continue to operate without requiring external finance.

The trustees are committed to ensuring the future financial stability of the charitable company and continually review the financial position and consider any changes required.

The charitable company receives no other income apart from its charitable activities, and therefore costs must be met as part of the charitable company’s rental income.

The charitable company endeavours to put value for money at the heart of everything it does by being prudent in its allocation of funds and creating the environment where management and staff remain cost conscious. The charitable company strives to get the balance right between costs, performance and quality, this is particularly important at this time when the social housing sector is consolidating and cost cutting.

The framework adopted by the charitable company includes:

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Coronavirus – Covid-19 Impact

The key economic impacts of the pandemic have been consequential to, reduced demand and spending due to stay-at-home public health advice, workers being off sick, school closures forcing additional childcare responsibilities onto parents, supply chain disruption, and the closure of businesses. Some sections of the economy saw a collapse in demand for goods and services. The pandemic has invoked huge uncertainty, mitigated to a degree by the UK vaccine rollout during 2021. It remains to be seen how long the economic recovery will take and to what extent will there be economic scarring or permanent damage.

Behavioural responses by consumers and businesses played a significant role in affecting the economy. Business confidence suffered because consumers were more cautious in their spending decisions. Businesses have reduced their investments due to the uncertain economic outlook and having to repay debts taken on during the pandemic.

The global nature of the crisis exacerbated domestic economic downturns and made it more difficult for any individual country to stem the decline. The global depth and reach of the economic crisis are unprecedented in modern times. In June 2020, the IMF chief economist said this is the “worst recession since the Great Depression [of the 1930s]” [IMF blog, https://blogs.imf.org/2020/06/24/reopening-fromthe-great-lockdown-uneven-and-uncertain-recovery/ 24 June 2020].

Economic statistics bear out the magnitude of the recession. UK’s GDP declined by 9.8% in 2020, the steepest drop since 1948. GDP was 25% lower in April 2020 than it was two months earlier in February. Economic activity picked up over the spring and summer of 2020 with restrictions easing and the release of pent-up economic demand. This was followed by a further lockdown in November 2020, before a slight recovery in December. A stricter lockdown in early 2021 saw economic activity decline again but less severely than during the first lockdown. GDP was 6% lower in March 2021 than before the pandemic. [Figures cited from ‘Briefing Paper, Coronavirus: Economic impact’ House of Commons Library - - https://commonslibrary.parliament.uk/research briefings/cbp 8866/ ].

There are concerns about the scale of the QE programme (the quantitative easing programme – where the Bank of England creates additional money and uses it to buy financial assets) exposing the Bank of England to political pressure to not raise interest rates, in circumstances when rising inflation is more than short-term. The Bank expects rising inflation to be “transitory …” but asset purchases already announced are likely to be made when the economy is growing and inflation rising at a faster rate than expected. The scale of the QE programme and the size of the Bank’s balance sheet, now equivalent to 40% of GDP, has increased the sensitivity of public debt servicing costs if the Bank needed to raise interest rates to control inflation. If the inflation threat is not met head-on, i.e., sufficiently early, it may be substantially more difficult for the Bank to curb later. [Concluding discussion points [s.183] of the of the Economic Affairs Committee of the House of Lords, ‘Quantitative Easing: a dangerous addition?’ https://publications.parliament.uk/pa/ld5802/ldselect/ldeconaf/42/42.pdf published 16 July 2021].

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Coronavirus – Covid-19 Impact (continued)

It is clear the Country is in a significant economic downturn. The operating environment for the housing sector is difficult and adversely impacted from pressure on income collection, delayed sales, and delayed development work. Quoting directly from the housing regulator’s Quarterly Survey for Q4 January to March 2021: “16 - As the country begins to emerge out of lockdown, providers will need to remain alert and ready to respond to further changes in the operating and economic environment. Forecasts will need to be closely monitored and updated as the economy re-opens, and flexibility will need to be included to allow any increasing risks to be effectively managed.”

SW9 Community Housing has shown resilience during the coronavirus outbreak. Income remained reasonably stable, and our business continuity plans proved to be robust, bolstered by SW9’s close association with its parent organisation, Network Homes, whose significant investment in IT systems paid dividends with the majority of SW9 staff being able to work seamlessly from home during periods of lockdown. We have therefore been able to maintain essential services to our residents.

We are mindful of the resultant significant economic impact on our customers, which is likely to be severe and lasting. Although we have adapted well as a business, we understand that many of our residents are facing financial stress. Our compassionate approach will be deployed to support all those who need help through these difficult times. As a resident-led organisation with a focus on local geography, SW9 will continue to provide good quality services to the Stockwell Park Estate and to its other managed properties. We are a charity that was established with the very objective to put residents and the local community first, and this we will continue to do. The impact of the Coronavirus means that none of us know what is going to happen over the coming weeks and months and all of us will have anxieties about the wellbeing of families and friends and the disruption to normal life. Our priority at SW9 is to ensure that residents, staff, and the people we all care for remain safe and protected.

Brexit

The previous year’s financial statements included considerable uncertainty surrounding Brexit with the possibility of a ‘no-deal’ Brexit firmly on the table. That position receded and since has been somewhat eclipsed by the pandemic, but risks associated with Brexit are largely covered in the following areas of concern: supply chain disruption leading to issues with availability and cost of engineered components, labour shortages particularly in the construction and property management sectors, adverse impact on the housing market and property values affecting market sales, reduction in tenants’ ability to pay their rent. SW9 remains reasonably well protected from direct impacts, with mitigations in place for indirect impacts on the general economy.

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Brexit (continued)

SW9’s Income Team act as welfare benefits advisers by signposting residents to resolve benefits issues, maximise their income and improve their financial situation. Using knowledge and experience acquired over many years, our staff ensure SW9 responds dynamically to government changes being made to welfare benefits and assistance programmes. Our focus is on tenancy sustainment to make a real difference to our customers’ lives, even in the most difficult circumstances.

Our judgement is that negative impacts arising from a general and prolonged economic downturn can and will, be managed. Good governance and an agile management team will be the foundation of rapid decision making as and when required, to protect the Charity’s position.

Investment powers and policy

The Trustees, having regard to the liquidity requirements of the charitable company, have kept available funds in a money market interest-bearing account. Due to historic low interest rates the monies on deposit achieved an average of 0.5% interest against a Consumer Price Index of 1.9% for the year.

Reserve policy

The reserves of the charitable company are unrestricted funds as shown on page 31. The total funds held by the charitable company at the end of the year are £1,144k, which are available for general charitable use.

The charitable company policy is to maintain reserves equivalent to three months operating costs. Average monthly operating costs are £441k; therefore, the reserves retained will be set at £1,322k.

When surpluses exceed £1,322k, the trustees will decide how much of the excess can be used for community benefit projects. Apart from effective management of the major contracts of the business, the reserves will be increased as a result of the additional units of stock. The risks associated with the level of reserves will be managed by the production and scrutiny of financial information and ensuring that robust processes and controls are adhered to.

The trustees will review the Reserves Policy on an annual basis.

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Plans for the future period

The trustees of the charitable company are committed to continuing to provide first class, resident-led housing, repairs, and support services to the residents of the Stockwell Park Estate and surrounding street properties. They also are considering some specific plans:

• Options Review Agreement

The Options Review Agreement is a legally binding agreement between SW9 and Network Homes. This review is to establish whether SW9 could become a viable stand-alone registered housing provider, independent of Network Homes. Both SW9 and Network Homes must have jointly commissioned the start of the review by 31 March 2021. This is now underway.

The SW9 Trustees know that they cannot alone make a significant decision about becoming independent. That decision would be delegated to residents by way of a ballot. If the Trustees decide it is not viable to seek independence, or a ballot takes place, but the Trustees and management are not successful in securing resident support, then the current situation (Network Homes as landlord and SW9 as managing agent) will continue.

• Expand our Digital Inclusion and self-service

Since the COVID-19 pandemic, access to non-essential management services has been limited. Residents were encouraged to use other methods to contact SW9 due to the estate office being closed. As part of our digital inclusion programme, the charity will continue to encourage customers to access services on-line. The charity still has an ambitious target to facilitate 80% of transactions online by the end of 2022. The charity will continue to maximise the benefit of its relationship with the parent, Network Homes by participating with information technology initiatives which add value to the customer experience and drive up back-office efficiency. The charity will continue to benefit from these projects at no additional cost, as it is already included within the Surplus Rent paid to the parent quarterly in arrears.

• Increase our Apprenticeship and Graduate employment opportunities

The Charity will increase the number of apprenticeship and graduate placements during the forthcoming year. It has set a target to have a minimum of 4 placements filled in both academic and non-academic roles.

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Principal Risks and uncertainties

The Trustees have considered the principal risks and uncertainties facing the charitable company. The main financial impact of risk is of an unforeseen fall in income or increase in expenditure. The fall in income arises as a direct consequence of a probable increase in rent arrears resulting from a general economic downturn causing some rent payers to claim Universal Credit. Additional expenditure due to budget overruns or unplanned events are also liable to occur.

The Trustees have also considered non-financial risks including building health and safety compliance, which is deemed paramount, and any potential breach is a principal risk. The Charity’s Risk Register is reviewed by all trustees twice per year and considered by the relevant committee four times per year.

Structure, Governance and Management

The charitable company was set up following the decision by Network Housing Group and its social landlord entities to amalgamate into one single social landlord, Network Homes Limited. The charitable company is a resident-led, locally managed, non-asset holding entity that provides a range of property management and maintenance services on behalf of Network Homes Limited following the stock transfer from the London Borough of Lambeth in March 2007.

The charitable company was incorporated on 5 May 2015 under the name of Stockwell and Brixton LMO. Stockwell and Brixton LMO changed its name to SW9 Community Housing on 15 August 2015. On 29 March 2016 Network Homes Limited paid £5,193 to the charitable company as initial funding. The charitable company became active from 1 April 2016. The charitable company is limited by guarantee and governed by its Memorandum and Articles of Association dated 28 March 2016.

Appointment of Trustees

The Trustees, as set out on page 1, comprise of non-executive board members and are responsible for managing the affairs of the charitable company. The board of Trustees is usually composed of:

The appointment of residents as Trustees and Company Members is via an open and democratic election process. These positions are publicised, and applications received and considered by the current members of the Trustees group of the charitable company. If there are more eligible tenant nominations than vacancies arising, an election process is held in accordance with the Articles. The Trustees make recommendations to the Board of Network Homes Limited for approval of those individuals to the SW9 Board. The appointments of the two ‘independent’ trustees are agreed by the members of the Trustees, while the local authority representative is appointed by the London Borough of Lambeth.

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Appointment of Trustees (continued)

Procedures are in place to identify and recruit suitably skilled trustees to provide strength, balance and diversity of thought to the board of the charitable company. Areas of expertise considered include social housing, finance, legal, marketing and communications, procurement, and development.

Whilst the resident Trustees do occupy properties within the Area of Benefit (Stockwell Park and surrounding street properties) they are occupied on the same terms as other residents in similar circumstances, and they are not able to use their position within the charitable company to any unfair advantage.

Trustee induction and training

New trustees complete an induction and training programme. During the induction they are briefed on their legal obligations under charity and company law, the Charity Commission guidance on public benefit, and their legal obligations generally. Trustees are introduced to the content of the Memorandum and Articles of Association, the Board structure, committees and decision-making processes, the business plan and recent financial performance of the charitable company. Trustees are also encouraged to spend a day with management and staff and other trustees and to also attend external training events to develop their knowledge and skills, as needed.

Organisation

The board of Trustees, which can have up to 13 members, determine the policy and strategy for the charitable company. The board meets a minimum of six times a year. There are sub-committees covering regeneration and development; finance, risk and audit; services; and human resources and remuneration, which normally meet a minimum of four times a year in addition to the board meetings. These committees have been established with delegated authority from the Board to review matters in detail and they report back to each board meeting as appropriate.

Day to day management of the charitable company is delegated to the Senior Leadership Team which is comprised of the:

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Related parties

None of the trustees receive remuneration or other direct benefit from their work with the charitable company. Any connection between a trustee and senior manager of the charitable company with a supplier or any contracted company must be disclosed to the full board of Trustees and Company Secretary. In the current year no such party transactions were reported.

All resident Trustees live in homes under the management of the charitable company. Generally, this does not affect their capacity to make independent and fair decisions, but if there is a specific situation where there may be conflicted interests, Trustees will remove themselves from meetings in accordance with the requirements of the Articles of Association and their legal duties and responsibilities.

Network Homes Limited is the ‘Parent’ of the charitable company, which is not wholly owned. The charitable company operates as an autonomous entity but receives some corporate service assistance such as regulatory and statutory compliance oversight, internal audit, information systems, rent accounting, procurement, asset management and development services, from Network Homes Limited.

Pay policy for senior staff

The charitable company operates a spot salary for all staff including senior managers. The spot salaries are independently benchmarked every three years against other social housing organisations in London.

The remuneration benchmark is the mid-point of the range paid for similar roles adjusted for a weighting of up to 2.5%. If recruitment has proven difficult in the recent past a market supplement is also paid with the pay maximum no greater than the highest benchmarked salary for a comparable role.

The spot salaries are reviewed annually and generally an inflationary increase is applied. This is dependent upon the financial success of the charitable company, and also increases being offered by the parent, Network Homes Limited, and other social housing providers in London.

The charitable company’s Executive Director holds no equity interest and although he does not have the legal status of director, he acts as chief officer within the authority delegated to him by the Trustees.

Directors’ and Officers’ liabilities insurance is in place.

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Risk Management

The trustees have a risk management strategy which comprises:

Fundraising

Section 162a of the Charities Act 2011 requires charities to make a statement regarding fundraising activities. The legislation defines fund raising as “soliciting or otherwise procuring money or other property for charitable purposes.”

In relation to the above the charitable company confirms that it has not directly solicited for funds through fundraising for the year ended 31 March 2021 and has not had any involvement of commercial participators or professional fund-raisers, or third parties.

The charitable company has not received any complaints in relation to fundraising activities nor does it consider it necessary to design specific procedures to monitor such activities since it does not approach any individuals for funds.

The charitable company does not have any undertaking to be bound by any regulatory scheme, however the Charity is a member of Fundraising Regulator’s Code of Fundraising Practice and complies with the relevant codes of practice. The charitable company does not consider it necessary to comply with any voluntary code of practice.

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SW9 COMMUNITY HOUSING

REPORT OF THE TRUSTEES (INCLUDING STRATEGIC REPORT) FOR THE YEAR ENDING 31 MARCH 2021 – continued

Significant risks 2020-21

The charitable company has identified a list of strategic level risks, of which the following risks have been identified as having the highest priority. To mitigate these risks, the Trustees have control measures and policies in place to ensure regulations and guidelines are adhered to and followed.

Risk Description Ownership Control Measures
Risk to services and business
continuity from the Coronavirus
pandemic
Impact of Covid-19 on ability to
operate and maintain safe, high
quality services to residents and
the Estate during the pandemic.
Reduction in staff availability;
service reduction and service
cessation; closure of reception;
and closure of offices.		 Senior
Leadership
Team/ Finance
Risk and Audit
Committee		 Workplace, Office, & Management Mitigations
REDUCED CONTACT & MIXING:Colleagues working
from home where possible; face-to-face meetings
avoided; in-person meetings limited to business
critical only; and restricted use of meeting rooms.
HEALTH:Promote vaccine take-up, wellbeing and
mental health support offered to all colleagues, focus
on mental well-being at regular 1-2-1 meetings.
ENFORCE SAFE WORKING PROTOCOLS:All staff
required to comply with Covid-safe protocols; wearing
of mask or face covering, signage to enforce guidance,
floor markings with 2m social distancing, one-way
system in the offices.
TECHNOLOGY:Effective use and deployment of IT
Service provision from Network Homes.
MANAGEMENT:Twice weekly meetings of SLT, weekly
All Staff Meetings, fortnightly or 4-weekly meetings
with nominated board member for Health and Safety,
regular meetings with Board and FRA Committee,
regular updates from Human Resources to all staff.
Litigation risk
Failure to correctly interpret
management agreement and/or
associated agreements.		 Senior
Leadership
Team/ Board		 Ensure framework for dispute resolutions are being
followed.
Board and management have open access to legal
advice to inform discussions and negotiations.
Maintain close working between board, officers, and
legal advisors.
Remain engaged in collaborative working with all
parties, to continuously deliver high quality services.
Disrepair caseload managed by Legal Services Advisor.

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Risk Description Ownership Control Measures
Caseload is reducing and preventive operational
measures deployed to minimise new cases from
emerging.
Inadequate Operational
Management Leading to Poor
Performance
Poor management of main
Responsive Repairs &
Refurbishment contractor.		 Senior
Leadership
Team /
Services
Committee		 New responsive repairs main contractor appointed in
October 2020 following a procurement exercise.
Strengthened system of approvals and sign-off.
Operating Strategy is to ‘exceed expectations’ at all
times.
Leadership/ People Risk
Failure to recruit, retain, and
engage a diverse workforce in
the right numbers with the right
skills, behaviours, and
experience.		 Senior
Leadership
Team / Human
Resources
Committee		 Workforce plan aligned to corporate objectives.
Delivery of workforce plan overseen by SLT.
Review of recruitment & selection procedures.
HR oversees & attends interviews as default position.
Advertisements placed with relevant media.
Regular team meetings to encourage team building.
Leadership & mentoring programmes.
Resilience building through cross-training and
alternating distribution of duties.
HR support underpinned by robust policies &
procedures.
Access to independent occupational health service;
and Employee Assistance Programme.
Ongoing training provided to managers.
Probationary process for new starters; regular 1-2-1
meetings for all staff.
Temporary positions likely to be vacant for more than
3-months filled by fixed term contract employees.
Risk to Services and Operations
Failure to exert control over
externally commissioned asset
management activity.		 Senior
Leadership
Team /
Services
Committee		 Assisted by dedicated M&E Team at Network Homes.
Promote closer partnership working with Network’s
Development and Asset Management teams.
Appropriate budget setting process with transparency
over costs.
Accessible databases for accurate and timely
information.
Action plans for latent defects and other works on
refurbished blocks.

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Risk Description Ownership Control Measures
Development contractor to have on-site operative for
12-month post completion period.
Health and Safety risk to staff,
residents, contractors, visitors,
and the public
Failure to adequately manage
health and safety systems
leading to risk of injury, harm, or
death.		 Senior
Leadership
Team / Board		 Office-based/ estate-based H&S measures are
informed by government guidance and government
public health measures in relation to Coronavirus
[Covid-19] pandemic.
General strengthening of Health & Safety operational
systems across all operational areas.
Increased monitoring and reporting of H&S activities
occurring daily, weekly, and monthly.
Operational meetings to include Health and Safety
with regular reporting to those meetings.
System of Occupational Risk Assessments to inform
management and staff of specific H&S issues and
design mitigating actions.
Briefing sessions and training programmes to increase
workplace risk awareness culture.
Continuous improvement to H&S reporting to SLT and
upwards reporting to Board and Committees.
Fortnightly meetings with nominated board member
for health and safety purposes.
Review of SW9 H&S Policy with changes in high-level
approach.
Regular reporting to Network Homes’ Health and
safety Panel meetings.
Financial risk
Risk of financial impact on
income caused by personal
hardship of residents.
Overspends/ Underspends
against budgets.
Failure to develop effective FM
across all departments.		 Head of
Finance /
Finance Risk &
Audit
Committee		 Income team provides support and assistance to
residents. Residents signposted to relevant help for
claims to UC. Use of repayment plans, flexibility with
payment agreements.
• Budgets linked to business planning and objectives.
• Monitor and report in a timely and accurate way.
• Enforce prescribed authorisation procedures for
service delivery.
• Analyse and review budget/cash flow variances and
actions to control costs.
• Regularly review reserves and investments.
Development of staff. Ensure adequate skills-base to
produce and interpret budgetaryand financial

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Risk Description Ownership Control Measures
reports. Develop and implement appropriate
structure. Devise Finance process & structure chart.
Regular financial stress-testing & scenario testing;
cost-centre based expenditure accounts for clarity &
control of expenditure.
Data Protection risk;
governance and compliance risk
Organisational / individual
practices inconsistent with good
information governance. Breach
of information governance law
(DPA / GDPR) resulting in
significant financial penalties and
/ or reputational damage.
Failure to meet the Economic
and Consumer Standards of the
Regulator of Social Housing, with
particular reference to the
governance standards and value
for money standard.		 Head of
Corporate
Services /
Finance Risk &
Audit
Committee		 Develop and maintain ‘Accountability Principle’
(Article 5(2) GDPR to demonstrate compliance.
Maintain clear understanding of data protection risk
identification, impact on corporate objectives and
impact on stakeholder expectations.
Establish and deploy data protection risk and control
assessments.
Establish and deploy training and refresher training
programme.
Regular reminders and good practice guidance at staff
meetings.
Programme of annual assessment to test compliance
with the Charity’s own rules, regulations of the
Charities Commission, and housing standards of the
Regulator of Social Housing.

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SW9 COMMUNITY HOUSING

REPORT OF THE TRUSTEES (INCLUDING STRATEGIC REPORT) FOR THE YEAR ENDING 31 MARCH 2021 – continued

Continuous improvement – Going Concern

The Board confirms that there is an ongoing process for identifying, evaluating and managing significant risks faced by the organisation. This process has been in place throughout the year under review, up to the date of the annual report, and is reviewed by the Board. The Board has reviewed the effectiveness of the systems of internal control, including the agreed sources of assurance and confirms they are appropriate for that purpose. The Board is satisfied there is sufficient evidence to confirm that adequate systems of internal control existed and operated throughout the year. Up to the date of signing of these financial statements those systems were directed at the management of the significant risks facing the organisation. No weaknesses were identified which would have resulted in material misstatement or loss that would have required disclosure in the financial statements.

The Charity Managers continue to identify, assess, and act on risks which are managed and monitored via the risk register system. All risks are discussed at regular review meetings, with an emphasis on red rated risks and how they are being mitigated. The managers are taking guidance from the Finance, Risk and Audit Committee to develop the alignment and triangulation of risks with operational activities.

The Charity’s risk management strategy is subject to annual review in line with the corporate plan.

During Quarter 4 of the last financial year there was escalation of risks in certain areas including the new threat from the Coronavirus infectious disease (Covid-19). Covid-19 currently appears as a standalone risk with the highest rating (before mitigations) in the register.

Trustees’ responsibilities in relation to the financial statements

The Charity Trustees (who are also the directors of SW9 Community Housing for the purposes of company law) are responsible for preparing a trustees’ annual report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the charity trustees to prepare financial statements for each year which give a true and fair view of the state and affairs of the charitable company and of the incoming resources and application of resources, including income and expenditure, of the charitable company for that period. In preparing the financial statements, the trustees are required to:

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SW9 COMMUNITY HOUSING

REPORT OF THE TRUSTEES (INCLUDING STRATEGIC REPORT) FOR THE YEAR ENDING 31 MARCH 2021 – continued

Trustees’ responsibilities in relation to the financial statements (continued)

The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Charity and to enable them to ensure that the financial statements comply with Companies Act 2006. They are also responsible for safeguarding the assets of the Charity and hence taking reasonable steps for the prevention and detection of fraud and other irregularities.

The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Trustees’ responsibility for internal control

The internal control function is carried out by the parent company, Network Homes Limited. The Trustees of the charitable company have overall responsibility for ensuring the effectiveness of their internal control.

The Trustees recognise that no system of internal control can provide absolute assurance or eliminate all risk. The system of internal control is designed to manage risk and provide reasonable assurance that key business objectives and expected outcomes will be achieved. It also exists to give reasonable assurance about the preparation and reliability of financial and operational information and the safeguarding of Network Homes Limited’s assets and interests.

Statement as the disclosure to our auditor

In so far as the trustees are aware, at the time of approving our Trustees’ annual report:

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SW9 COMMUNITY HOUSING

REPORT OF THE TRUSTEES (INCLUDING STRATEGIC REPORT) FOR THE YEAR ENDING 31 MARCH 2021 – continued

Independent auditors

The report of the Trustees incorporating the strategic report was approved and authorised for issue by the Trustees on 23 November 2021 and were signed on its behalf by:

----- Start of picture text -----
............................................ Dee Alapafuja, Chair
............................................ Paul Brett, Board Member; Chair of Finance Risk and Audit Committee
----- End of picture text -----

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SW9 COMMUNITY HOUSING

INDEPENDENT AUDITOR’S REPORT TO MEMBERS OF SW9 COMMUNITY HOUSING FOR THE YEAR ENDED 31 MARCH 2021

Opinion on the financial statements

In our opinion, the financial statements:

We have audited the financial statements of SW9 Community Housing (“the Charitable Company”) for the year ended 31 March 2021 which comprise the Statement of Financial Activities, the Statement of Financial Position and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We remain independent of the Charitable Company 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.

Conclusions related 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 Charitable Company'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.

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SW9 COMMUNITY HOUSING

INDEPENDENT AUDITOR’S REPORT TO MEMBERS OF SW9 COMMUNITY HOUSING FOR THE YEAR ENDED 31 MARCH 2021 - continued

Other information

The Trustees are responsible for the other information. The other information comprises the information included in the Report of the Trustees, incorporating the Strategic Report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Other Companies Act 2006 reporting

In our opinion, based on the work undertaken in the course of the audit:

In the light of the knowledge and understanding of the Charitable Company and its environment obtained in the course of the audit, we have not identified material misstatement in the Strategic report or the Trustee’s report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion;

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SW9 COMMUNITY HOUSING

INDEPENDENT AUDITOR’S REPORT TO MEMBERS OF SW9 COMMUNITY HOUSING FOR THE YEAR ENDED 31 MARCH 2021 – continued

Responsibilities of Trustees

As explained more fully in the Trustees’ responsibilities statement, the Trustees (who are also the directors of the charitable company for the purposes of company law) 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 determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the Charitable Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the Charitable Company or 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 the Companies Act 2006 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.

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

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:

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SW9 COMMUNITY HOUSING

INDEPENDENT AUDITOR’S REPORT TO MEMBERS OF SW9 COMMUNITY HOUSING FOR THE YEAR ENDED 31 MARCH 2021 – continued

Extent to which the audit was capable of detecting irregularities, including fraud (continued)

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (“FRC’s”) website at:

https://www.frc.org.uk/auditorsresponsibilities . This description forms part of our auditor’s report.

Use of our report

This report is made solely to the Charitable Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Charitable Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charitable Company and the Charitable Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Philip Cliftlands (Senior Statutory Auditor) For and on behalf of BDO LLP, Statutory Auditor Gatwick, UK

Date 09 December 2021

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

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SW9 COMMUNITY HOUSING

STATEMENT OF FINANCIAL ACTIVITIES

(Including income and expenditure account)

For the year ended 31 March 2021

Note
Income
Income from charitable activities
2
Income from investing activities
Total Income
Expenditure
Total expenditure on charitable activities
3
Net income before taxation
7
Taxation
8
Net income after taxation
Reconciliation of funds
Total funds brought forward
Transfer to reserves
Total funds carried forward		 Total Funds
2021
£’000
8,675
-
8,675
(8,302)
373
-
373
771
-
1,144		 Total Funds
2020
£'000
8,029
2
8,031
(7,943)
88
-
88
683
-
771

The Statement of Financial Activities includes all gains and losses recognised in the year.

All income and expenditure are derived from continuing activities.

For more information, please refer to accounting policy on ‘Fund accounting’.

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SW9 COMMUNITY HOUSING

STATEMENT OF FINANCIAL POSITION

As at 31 March 2021

9 COMMUNITY HOUSING
ATEMENT OF FINANCIAL POSITION
at 31 March 2021
Current Assets
Debtors
10
Cash at bank and in hand
11
Liabilities
Creditors falling due within one year
12
Net Current Assets
Provision for liabilities and charges
13
Net Assets
The funds of the charity:
Unrestricted funds
Total charity funds		 2021
£'000
554
4,095
4,649
(3,151)
1,498
(354)
1,144
1,144
1,144		 2020
£'000
738
3,173
3,911
(3,140)
771
-
771
771
771

Notes on pages 32 – 47 form part of the financial statements.

The financial statements on pages 30 to 47 approved and authorised for issue by the Trustees on 23 November 2021 were signed on its behalf by:

Delroy Rankin, Executive Director

………………………………………………….

Sarah Patrice, Secretary ………………………………………………….

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 31 March 2021

1. Accounting policies

SW9 Community Housing is incorporated in England and is registered under the Companies Act 2006 and the Charity Act 2011. The Charitable Company’s registered address is 6 Stockwell Park Walk, London, SW9 0FG, United Kingdom.

Network Homes Limited is the immediate and ultimate parent and prepares consolidated financial statements for the Group undertakings at 31 March 2021. The consolidated financial statements of Network Homes Limited are available from Network Homes Limited, The Hive, 22 Wembley Park Boulevard, Wembley, Middlesex, HA9 0HP.

Basis of preparation

The financial statements have been prepared under the historical cost convention and in accordance with United Kingdom applicable accounting standards, including, Financial Reporting Standard 102, The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (“FRS 102”), and 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 (‘the SORP 2019’), and the Companies Act 2006.

The Charitable Company meets the definition of a public benefit entity under FRS 102 and the charity commission guideline for England and Wales (section 7.1.5).

The Charitable Company’s presentation currency is Great British Pounds. Amounts are presented in thousands unless stated otherwise.

Going concern

These financial statements are prepared on a going concern basis. The last three months of the year under review and the 4 months following, have shown periods of increased operational expenditure. Due to repeated national lockdowns during which repairs services were limited to emergencies, there was an accumulation of outstanding repairs. These repairs are currently being processed as we gradually begin providing a full range of services.

Income collection was adversely impacted in the first two months of the financial year. Weekly monitoring and reporting of income were introduced, with upwards weekly reporting to the Board. At the end of the year income collection produced favourable collection rates despite the challenges. Critically, our cash position remains strong, and this position is not expected to deteriorate in the foreseeable future. The business environment is expected to remain challenging, but SW9 is well placed with adequate reserves to meet these challenges from a position of strength.

The Charity has reviewed its risk register and does not consider the organisation to be in a stress situation. The liquidity policy is to retain sufficient cash/cash-equivalent funds for the business to operate without

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

1. Accounting policies – continued

any income for up to 3-months. Cash flow is monitored and reported monthly to the Finance Risk and Audit Committee.

The Charity has remained compliant with all statutory, regulatory and disclosure requirements throughout the lockdown, having agreed an extension of its filing deadline with Companies House and the Charity Commission. The extension was to afford additional time to correct accounting entries between SW9 accounting records and that its parent organisation, Network Homes.

The board is of the opinion that the risks and uncertainties identified should not threaten the sustainability and viability of SW9 as a going concern. Therefore, it is not appropriate to modify the key assumptions and judgements while preparing the financial statements and a material uncertainty does not exist.

Cash flow statement

The parent, Network Homes Limited produces a publicly available consolidated statement in which the Charitable Company’s financial statements are included. It has therefore elected to apply the exemption from making disclosures in relation to cash flow statement in accordance with FRS 102.

Charitable activities

The Charitable Company aims to deliver high quality housing, support, estate and community services to residents and tenants living on the Stockwell Park Estate and surrounding street properties.

Income

Income is recognised when the Charitable Company has entitlement to the funds, it is probable that the income will be received, and the amount can be measured reliably. Income represents rental and service charge income receivable and investment income from interest on money market deposits. Turnover excludes value added tax where applicable.

Rents and service charges

Income from rents and service charges are recognised by the Charitable Company on a receivable basis.

Fund accounting

The Charitable Company’s funds consist of unrestricted funds which are available to spend on activities that further any of its purposes. The Charitable Company has not reported any restricted funds.

Expenditure

Expenditure is recognised once there is a legal or constructive obligation to make payment, it is probable that settlement will be required, and the amount of the obligation can be measured reliably.

Expenditure is accounted for on an accrual basis and has been classified under the headings that aggregate all costs related to the category.

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

1. Accounting policies – continued

Support Costs

Support costs comprise staff costs incurred in relation to the furtherance of the Charitable Company objects and the costs have been apportioned on the basis of head count.

Governance Costs

Governance costs relate to expenditure incurred in the governance of the Charitable Company assets and compliance with constitutional and statutory requirements.

Defined contribution scheme

The Charitable Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Charitable Company pays fixed contributions into an independent separate entity that administers the funds. Once the contributions have been paid the Charitable Company has no further payment obligations. The contributions are recognised as an expense in the Statement of Financial Activities when they are due.

Value added tax (VAT)

The Charitable Company is part of Network Homes Limited’s VAT Group. Network Homes Limited is partially exempt in relation to VAT and accordingly is able to recover from HM Revenue and Customs part of the VAT incurred on expenditure. At the year-end VAT recoverable or payable is included in the Statement of Financial Position and Irrecoverable VAT is accounted for in the Statement of Comprehensive Income within the relevant expense line of Network Homes Limited.

Taxation

The Charitable Company has charitable status and thereby is exempt from tax on its charitable activities.

Debtors

Trade debtors are recognised at the settlement amount due on 31 March 2021. Prepayments are valued at the amount prepaid.

Related parties

The Charitable Company discloses transactions with related parties which are not wholly owned within the same Group. The Charitable Company does not disclose transactions with members of the same Group that are wholly owned as allowed by FRS 102 paragraph 33.1A.

Financial Instruments

Financial asset represents financial resources available to the Charitable Company and these comprise cash at bank and in hand, trade debtors and other debtors. A financial liability is a financial claim on the Charitable Company’s resources and comprises creditors, accruals and amount to parent undertaking.

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

1. Accounting policies – continued

The Charitable Company’s financial instruments are all categorised as basic and are initially recognised at the amount receivable or payable including any related transaction costs and subsequently measured at the cash or other consideration expected to be paid or received.

Critical judgements and estimation uncertainty

The following are the significant management judgements and estimates applied in these financial statements:

Amounts due from Network Homes Limited

From 1st April 2016 SW9 took over the responsibility of managing and collecting rents from tenants. However, ownership rights and responsibilities relating to certain pre-existing debts and overpayments have not been fully concluded. Mutual agreement over these matters has not yet been achieved and as a result entitlement to certain rental debts and responsibilities associated with the settlement of historic overpayments remain uncertain.

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

2. Income from charitable activities

Rental Income
Rented accommodation
Sheltered accommodation
Leasehold accommodation
Service Charges Receivable
Rented accommodation
Sheltered accommodation
Leasehold accommodation
Other social housing activities:
Other Income
Total social housing lettings
Non social housing activities:
Other income
Total Income from charitable activities		 Total Funds
2021
£'000
5,029
523
256
5,808
718
271
1,122
2,111
564
8,483
192
8,675		 Total Funds
2020
£'000
5,024
391
214
5,629
805
224
992
2,021
320
7,970
59
8,029

Income from investing activities is disclosed separately in the Statement of Financial Activities and relates to interest on money market deposit.

All income in the current year and prior year relates to unrestricted funds.

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

3. Expenditure on charitable activities

Staff costs
Governance
Support
Recruitment
Training
Community engagement
Office costs
Management charge
Property maintenance
Provision of service to residents
Other operational costs		 Management
£'000
982
140
131
13
1
-
64
3,016
-
-
430
4,777		 Repairs
£'000
256
-
21
10
-
-
10
-
1,100
-
-
1,397		 Services
£'000
208
-
37
1
-
54
18
-
-
1,810
-
2,128		 Total
2021
£'000
1,446
140
189
24
1
54
92
3,016
1,100
1,810
430
8,302

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SW9 COMMUNITY HOUSING

NOTES TO THE FINANCIAL STATEMENTS – continued

For the year ended 31 March 2021

3. Expenditure on charitable activities - continued

Staff costs
Governance
Support
Recruitment
Training
Community engagement
Office costs
Management charge
Property maintenance
Provision of service to residents
Other operational costs		 Management
£'000
792
139
166
31
8
-
57
2,705
-
-
175
4,073		 Repairs
£'000
248
-
30
36
1
-
10
-
1,262
-
-
1,587		 Services
£'000
224
-
45
-
2
69
16
-
-
1,927
-
2,283		 Total
2020
£'000
1,264
139
241
67
11
69
83
2,705
1,262
1,927
175
7,943

Expenditures mainly relate to provision of services to residents, property maintenance and fees payable to parent company. Management charge of £3,016k (2020: £2,705k) relates to surplus rent payable to the parent company as detailed in the management agreement. This amount is calculated as 47% of the total rents and other rents receivable for the year less rent and service charge void losses.

All expenditure in the current and prior year relates to unrestricted funds.

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For the year ended 31 March 2021

4. Analysis of support and governance costs

Finance
Human resources
Consultancy
Audit fees
Recruitment		 Support
2021
£'000
116
72
-
-
1
189		 Governance
2021
£'000
-
3
123
14
-
140		 Support
2020
£'000
181
60
-
-
-
241		 Governance
2020
£'000
-
-
130
9
-
139

Finance support cost allocation is based on head count and all other support cost is apportioned based on actual costs.

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5. Employee information

The monthly average number of persons employed during the year, including the Executive Officer, is based on an assumption that a full-time equivalent employee (FTE) works 35 hours and includes employees on both permanent and fixed term contracts:

Office staff
Scheme-based staff		 2021
FTE
Head Count
36
51
2
2
38
53		 2020
FTE
Head Count
31
34
2
2
33
36

Staff costs for the above employees were:

Wages and salaries
Social security costs
Pensions costs		 2021
£'000
1,397
137
78
1,612		 2020
£'000
999
102
53
1,154

On the 1[st] September 2020, the cleaning service was brought “in house” which increased the head count of SW9 CH by 17.

The staff of the Charitable Company participates in the defined contribution scheme run by the Social Housing Pension Scheme. Pension costs are employer’s cost payable to the Pension Trust.

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For the year ended 31 March 2021

5. Employee Information (continued)

The number of staff receiving remuneration in excess of £60,000 per annum at 31 March 2021 is as follows:

2021 2020
£60,000 - £69,999 2 0
£70,000 - £79,999 0 1
£100,000 - £109,999 0 1
£110,000 - £119,999 1 0
£120,000 - £129,999 1 0

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For the year ended 31 March 2021

6. Directors’ emoluments

The Directors are defined as members of the Trustees and the Executive Officers. The Trustees of the Charitable Company did not receive any remuneration in the year and there was no reimbursement of expenses.

Day-to-day management of the Charitable Company is delegated to the Senior Leadership team which is comprised of the:

Remuneration of key management personnel

Aggregate emoluments payable to Senior Leadership Team
Pension contributions payable to Senior Leadership Team
Total emoluments		 2021
£’000
364
23
387		 2020
£’000
288
15
303

Senior Leadership Team members are ordinary members of the defined contribution Social Housing Pension Scheme on the same basis as that available to all staff. The Charitable Company did not make any contribution to any individual pension arrangements on their behalf. The notice period for termination of their contracts is three months. No pension contributions were made on behalf of any non-executive Director.

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7. Net income before tax

2021 2020
This is stated after charging: £'000 £'000
Auditors’ remuneration (excluding VAT):
Fees for the audit of the Company’s financial statements 10 8
Fees for the audit of the Company’s financial statements: Prior 4 -
year

Audit fees are reviewed on an annual basis.

8. Taxation

The Charitable Company is a charity for tax purposes and is therefore not subject to corporation tax on its charitable activities. There was no non-charitable income in the year.

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9. Debtors

Rent and service charges
Rent provision for doubtful debts
Trade debtors
Less: provision for bad and doubtful debts
Other debtors
All debts are due within one year.
10.
Cash at bank and in hand
Cash at bank and in hand		 2021
£'000
638
(182)
456
30
-
68
554
2021
£'000
4,095		 2020
£'000
699
(194)
505
8
-
225
738
2020
£'000
3,173

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11. Creditors falling due within one year

Service charge and client’s funds
Trade creditors
Owed to Group undertakings
Other creditors including taxation and social security
Accruals
Rent and service charges received in advance		 2021
£'000
-
36
901
50
1,492
672
3,151		 2020
£'000
28
174
540
38
815
1,545
3,140

Amounts owed to Group undertakings are payable on a quarterly basis based on the management agreements.

12. Provisions for Liabilities and Charges

2021 2020
£'000 £'000
Provisions for Liabilities and Charges 354 -

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13. Parent undertaking and ultimate parent undertaking

The immediate and ultimate parent undertaking and controlling party is Network Homes Limited, a Company incorporated in England and registered with the Homes England (registration no. L4825).

Network Homes Limited consolidates the financial statements of all the Group undertakings at 31 March 2021. The consolidated financial statements of Network Homes Limited are available from Network Homes Limited, The Hive, 22 Wembley Park Boulevard, Wembley, Middlesex, HA9 0HP.

14. Related parties

At 31 March 2021, the total rent and service charge the Charitable Company received from tenant Trustees members’ amount to £68,075 (2020: £36,284). The tenant Trustee members all of whom have paid rents and service charge to the Charitable Company at arm’s length had not outstanding balances at the year end. They are listed below as follows:

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15. Contingent Liability

At 31[st] March 2021, SW9 CH was invoiced for a total of £622,956.42 by the parent company for Business Transformation projects. Having reviewed the terms of the management agreement and taken legal advice, it is the Board’s view that it is not probable that SW9 CH will be liable for these costs. A legal process is underway, and a final determination of liability will be made in the new financial year.

Other directorships

Trustees had the following external directorships, not including directorships of subsidiaries of Network Homes Limited. There were no transactions with any of the entities listed below.

Trustees Member Other entities Position
Benjamin Peart Redeem Information Systems Director
Paul Brett Brett Consultants Limited Director

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