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2024-06-30-accounts

REGISTERED CHARITY NUMBER: 1171686

Report of the Trustees and

Unaudited Financial Statements for the Year Ended 30 June 2024

for

Open Arms Malawi

Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Contents of the Financial Statements for the Year Ended 30 June 2024

Page
Report of the Trustees 1
Independent Examiner's Report 6
Statement of Financial Activities 7
Balance Sheet 8
Notes to the Financial Statements 9 to 15

Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Report of the Trustees for the Year Ended 30 June 2024

The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 30 June 2024. The trustees have adopted the provisions of Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

REFERENCE AND ADMINISTRATIVE DETAILS Registered Charity number

1171686

Registered office

Community House 46-50 East Parade Harrogate HG1 5RR

Trustees

A M Martin Ms A J Ainley S E Walker Ms J Peak G F W Park C R Hartley Ms J Hartley

Independent Examiner

Nicola Adams ACA DChA BHP LLP One, Waterside Place, Basin Square Brimington Road Chesterfield S41 7FH

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Objectives and Activities of the Charity

Activities

The Charity raises funds, predominantly in the UK, and all the Charity’s grants are directed to Open Arms Infant Homes (OAIH), an independent Malawi based charity which is dedicated to saving and improving the lives of orphaned and vulnerable children. They do this by working closely with families and communities to support their basic needs, like food, health, family attachments and education. They then work to empower families to generate a sustainable income through business support so that they can achieve better outcomes.

OAIH is an independent Malawi based trust. A separate team of 7 Trustees based in Malawi manages this trust and OAM remains in active dialogue with both the trust and its management.

A summary of the objects of the Charity as set out in its governing document.

The trustees shall apply the income, and at their discretion apply the whole or any part of the capital, of the trust fund for the relief of children in need in Malawi suffering from hardship and distress by reason of their social and economic circumstances as follows:

  1. By the provision of accommodation for orphan and neglected children including the provision of such essential factors as love, care, food and clothing.

  2. By providing hospice accommodation for orphan and neglected children suffering from terminal illness covering medical and nursing care and funeral expenses.

  3. By the provision of such basic educational, social, moral and spiritual training as will enable them to live and face the challenges of life.

Public benefit that is provided by the Charity

During the year the Charity undertook fundraising activities to facilitate the provision of care to Malawi's vulnerable In planning our activities for the year we kept in mind the Charity Commissions guidance on public benefit at our trustee meetings. During the year the charity undertook fundraising activities to children, supporting them within families and communities so they can thrive. The trustees have referred to the facilitiate the provision of the summary of objects shown above. Charity Commission's guidance on public benefit during board meetings and throughout the activities in which the Charity participates.

Achievements and Performance

The Charity’s charitable grants were all directed to OAIH, which employs circa 40 people in Malawi. The OAIH people are engaged in delivering the various charitable activities as described below.

Infant and community-based care

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Nursery education

Community outreach

Care for older children and young adults

Future plans

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

OAIH leadership

The day-to-day management of OAIH is being overseen by OAIH’s chair of trustees. In support of the new strategic direction, OAIH has restructured their leadership team and recruited a reintegration manager and a general manager who will take on the running of the organisation. Work will continue to build the resources needed, as well as the systems and processes to allow OAIH to run the programmes needed to achieve its charitable objectives.

Financial Review

Net income, (after raising funds expenditure of £9,446; 2022/23: £9,971), was up on the previous year at £299,340 (2022/23: £261,551). The increase reflects the hard work of the fundraising team albeit the aftermath of the pandemic and ongoing current cost of living challenges continue to adversely affect fundraising activity.

Total expenditure, (which includes grants made to OAIH), was £326,781, (2022/23: £322,089), principally reflecting a slight increase in general costs due to inflation.

The total grants to OAIH during the year were £230,412, which was approximately the same as the £230,830 paid in 2022/23.

Support costs within the UK fundraising organisation increased to £86,923 in 2023/24 from £81,228 2022/23 reflecting there is an ongoing drive by the Charity to keep costs as low as possible to maximise the money available for funding grants to OAIH.

Reserves Policy

A contribution from unrestricted reserves of £11,957, (2022/23: £56,605) was needed to fund annual activity.

Free reserves at 30 June 2024 were £140,415, (2022/23: £152,372), which will be used to fund future charitable activities.

The trustees had planned for this small reduction in reserves during the year as the expenditure incurred by OAIH was reduced to match the funding available from OAM. Going forward the position is forecast to stabilise and the grants to OAIH will be matched to annual fundraising.

At all times the trustees will maintain sufficient reserves to meet the liabilities of the Charity.

Grant Making Policy

All the Charity’s grants were made to OAIH. The bulk of funds distributed to OAIH are in response to their annual plan and fund the ongoing normal operating costs. Additionally, requests may be made through the year for funds that are more capital in nature. The UK board considers each additional grant request outside of the annual plan.

Investment Policy

The Charity does not hold investments but had cash on deposit at the end of the financial year of £140,987, (2022/23: £159,244)

Nature of the Governing Document and constitution of the charity

The charity is a registered charity, number 1171686, and constituted under a CIO Foundation registered on 20 February 2017.

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

The methods adopted for the recruitment and appointment of new trustees

All trustees, of which there must be at least three at any time, must be appointed by special resolution at a special meeting. In selecting persons to be appointed as trustees, the trustees consider the skills required by the Charity and the skills, experience and qualifications of the candidates.

Organisational structure and decision making

The Charity is managed by an active team of trustees who bring a breadth of UK and International corporate, educational, public sector and support services experience to the group. The trustee group met formally 5 times during the year. A 4 strong part-time fundraising team, (equal to 2 full time equivalents) as well as several volunteers managed day-to-day activity from offices in Harrogate.

Risk management

Several areas of risk to the ability of the Charity to undertake its activities consistently have previously been identified.

The Charity continues to be impacted by the following:

The trustees continue to keep these matters under review at each board meeting and as described above, have taken action to ensure that over the next one to two years the Charity’s expenditure matches its income such that an appropriate level of reserves is maintained.

Going Concern

Fundraising activity and income generation have significantly reduced since 2020 and, in their planning, the trustees have assumed that there will be no recovery in the medium term.

The grants to OAIH have been significantly reduced and the Charity’s costs care being carefully monitored and managed.

There has been a small reduction in reserves in 2023/24 but, as a consequence of the actions to date and planned future actions, we are forecasting that the reserves will stabilise, and we will reach an equilibrium where net fundraising income will match the grants paid to OAIH.

The trustees will continue to ensure that the Charity’s reserves are maintained at the minimum level to meet its liabilities

For these reasons, the accounts have been prepared on a going concern basis. Further details can be found in accounting policies.

Future plans

We will continue to actively engage with OAIH to deliver forward plans that OAM will be able to fund for the long term. A joint OAM/OAIH meets regularly to assess progress and discuss concerns.

We are continuing to carefully manage cash flow and balance this against the demand for funding.

10/03/2025 GMT

Approved by order of the board of trustees on ............................................. and signed on its behalf by:

........................................................................ Signer ID: KMLUC3GIPR... A M Martin - Trustee

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Independent Examiner's Report to the Trustees of Open Arms Malawi

Independent examiner's report to the trustees of Open Arms Malawi ('the charity')

I report to the charity trustees on my examination of the accounts of the charity for the year ended 30 June 2024 which are set out on pages 7 to 15.

Responsibilities and basis of report

As the charity's trustees you are responsible for the preparation of the accounts in accordance with the requirements of the Charities Act 2011 ('the Act').

I report in respect of my examination of the charity's accounts carried out under section 145 of the Act and in carrying out my examination I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the Act.

Independent examiner's statement

Since the charity's gross income exceeded £250,000 your examiner must be a member of a body listed in section 145 of the Act. I confirm that I am qualified to undertake the examination because I am a member of the ICAEW, which is one of the listed bodies.

I have completed my examination. I confirm that no material matters have come to my attention in connection with the examination giving me cause to believe that in any material respect:

  1. accounting records were not kept in respect of the charity as required by section 130 of the Act;or

  2. the accounts do not accord with those records; or

  3. the accounts do not comply with the applicable requirements concerning the form and content of accounts set out in the Charities (Accounts and Reports) Regulations 2008 other than any requirement that the accounts give a 'true and fair view' which is not a matter considered as part of an independent examination.

I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached.

Signer ID: CZYRUVFAHR...

Nicola Adams ACA DChA

BHP LLP One, Waterside Place, Basin Square Brimington Road Chesterfield S41 7FH

10/03/2025 GMT Date: .............................................

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Statement of Financial Activities for the Year Ended 30 June 2024

Unrestricted
fund
Notes
£
INCOME AND ENDOWMENTS FROM
Donations and legacies
2
215,083
Other trading activities
3
67,716
Investment income
4
3,722
Total
286,521
EXPENDITURE ON
Raising funds
5
9,446
Charitable activities
6
General
289,032
Total
298,478
NET INCOME/(EXPENDITURE)
(11,957)
RECONCILIATION OF FUNDS
Total funds brought forward
152,372
TOTAL FUNDS CARRIED FORWARD
140,415
Restricted
fund
£
22,265
-
-
22,265
-
28,303
28,303
(6,038)
6,038
-
2024
Total
funds
£
237,348
67,716
3,722
308,786
9,446
317,335
326,781
(17,995)
158,410
140,415
2023
Total
funds
£
218,113
52,152
1,257
271,522
9,971
312,118
322,089
(50,567)
208,977
158,410

The notes form part of these financial statements

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Balance Sheet 30 June 2024

2024 2023
Unrestricted Restricted Total Total
fund fund funds funds
Notes £ £ £ £
CURRENT ASSETS
Debtors 11 1,705 - 1,705 580
Cash at bank 140,987 - 140,987 159,244
142,692 - 142,692 159,824
CREDITORS
Amounts falling due within one year 12 (2,277) - (2,277) (1,414)
NET CURRENT ASSETS 140,415 - 140,415 158,410
TOTAL ASSETS LESS CURRENT LIABILITIES 140,415 - 140,415 158,410
NET ASSETS 140,415 - 140,415 158,410
FUNDS 13
Unrestricted funds:
General fund 140,415 152,372
Restricted funds:
Malawi Grants - 6,038
TOTAL FUNDS 140,415 158,410

The financial statements were approved by the Board of Trustees and authorised for issue on ............................................. and were signed on its behalf by: 10/03/2025 GMT

............................................. Signer ID: KMLUC3GIPR... A M Martin - Trustee

The notes form part of these financial statements

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Notes to the Financial Statements for the Year Ended 30 June 2024

1. ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant notes to these accounts. The financial statements have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) issued on 16 July 2014 (as updated through Update Bulletin 1) and Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) and Charities Act 2011.

The financial statements have been prepared to give a 'true and fair' view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a 'true and fair view'. This departure has involved following the 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) issued on 16 July 2014 rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005 which has since been withdrawn.

Open Arms Malawi constitutes a public benefit entity as defined by FRS 102.

The financial statements have been prepared in £ sterling which is the functional currency of the charity and rounded to the nearest pound.

Critical accounting judgements and key sources of estimation uncertainty

Estimates and judgement are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstance. Critical accounting estimates and assumptions:

The charity makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results. There are no estimates and assumptions that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Income

All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.

Expenditure

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Expenditure is recognised where there is a legal or constructive obligation to make payments to third parties, it is probable that the settlement will be required and the amount of the obligation can be measured reliably.

It is categorised under the following headings:

Costs of raising funds; and Expenditure on charitable activities

Irrecoverable VAT is charged as an expense against the activity for which expenditure arose.

Grants payable to third parties are within the charitable objectives. 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 performance then the grant is only accrued when any unfulfilled conditions are outside of the control of the charity.

continued...

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Notes to the Financial Statements - continued for the Year Ended 30 June 2024

1. ACCOUNTING POLICIES - continued

Taxation

The charity is considered to pass the tests set out in Sch. 6, para. 1 of the Finance Act 2010 and therefore it meets the definition of a charity for UK income tax purposes. Accordingly, the charity is potentially exempt from taxation in respect of income or capital gains received within categories covered by Income Tax Act 2007, Part 10 s521 - s537 or s. 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes. Value Added Tax is not recoverable by the charity, and is therefore included in the relevant costs in the Statement of Financial Activities.

Fund accounting

The charity maintains a general unrestricted fund which represents funds which are expendable at the discretion of the trustees in furtherance of the objects of the charity. Such funds may be held in order to finance both working capital and capital investment.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the charity for particular purposes. The costs of raising and administering such funds are charged against the specific fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

Pension costs and other post-retirement benefits

The charity operates a defined contribution pension scheme. Contributions payable to the charity's pension scheme are charged to the Statement of Financial Activities in the period to which they relate.

Debtors

Trade and other debtors are recognised at the settlement amount after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

Cash at bank and in hand

Cash at bank and in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

Liabilities and provisions

Liabilities are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Liabilities are recognised at the amount that the charity anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide. Provisions are measured at the best estimate of the amounts required to settle the obligation.

Financial instruments

The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.

Employee Benefits

When employees have rendered services to the charity, short-term employee benefits to which the employees are entitled are recongnised at the undiscounted amount expected to be paid in exchange for that service.

continued...

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Open Arms Malawi

Notes to the Financial Statements - continued for the Year Ended 30 June 2024

1. ACCOUNTING POLICIES - continued

Going Concern

The Board have prepared forecasts of income and expenditure and cash flow for the period to 28 February 2026 and subjected these forecasts to sensitivity analysis which shows that they have sufficient reserves to be able to continue for the foreseeable future if grant making activity is reduced. They will continue to monitor the impact on income and reduce grant making as necessary to maintain a sufficient level of cash reserves.

The Trustees have concluded that the charity remains a going concern whilst such viable options are available to it and therefore continue to adopt the going concern basis of preparation for these financial statements.

2. DONATIONS AND LEGACIES

Unrestricted
funds
£
Donations
2,884
Gift aid
18,117
Legacies
11,778
Regular individual donations
70,029
Churches
1,010
Companies
54,044
Schools
6,539
Trusts
50,682
215,083
Restricted
funds
£
165
-
-
100
-
17,500
2,500
2,000
22,265
2024
Total
funds
£
3,049
18,117
11,778
70,129
1,010
71,544
9,039
52,682
237,348
2023
Total
funds
£
15,579
16,663
539
70,550
3,920
22,065
25,055
63,742
218,113

3. OTHER TRADING ACTIVITIES

OTHER TRADING ACTIVITIES
Unrestricted
Restricted
funds
funds
£
£
Fundraising events
65,246
-
Shop income from sale of donated and
bought in goods
2,470
-
67,716
-
2024
Total
funds
£
65,246
2,470
67,716
2023
Total
funds
£
49,210
2,942
52,152

continued...

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9

Open Arms Malawi

Notes to the Financial Statements - continued for the Year Ended 30 June 2024

4. INVESTMENT INCOME

4. INVESTMENT INCOME
2024 2023
Unrestricted Restricted Total Total
funds funds funds funds
£ £ £ £
Deposit account interest 3,722 - 3,722 1,257
5. RAISING FUNDS
Raising donations and legacies
2024 2023
Unrestricted Restricted Total Total
funds funds funds funds
£ £ £ £
Cost of fundraising activities 6,947 - 6,947 7,802
Other trading activities
2024 2023
Unrestricted Restricted Total Total
funds funds funds funds
£ £ £ £
Purchases of goods for sale 413 - 413 450
Commission payable 2,086 - 2,086 1,719
2,499 - 2,499 2,169
Total expenditure on raising funds 9,446 - 9,446 9,971
6. CHARITABLE ACTIVITIES COSTS
Grant
funding of
Direct activities
Costs (see (see note
note 7) 8) Totals
£ £ £
General 86,923 230,412 317,335

In the prior year direct costs were £81,288 and grant funding totalled £230,830, resulting in total charitable activities expenditure of £312,118. (see notes 7 & 8)

continued...

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Open Arms Malawi

Notes to the Financial Statements - continued for the Year Ended 30 June 2024

7. DIRECT COSTS OF CHARITABLE ACTIVITIES

Staff costs
Insurance
Telephone
Postage and stationery
Sundries
Travel and subsistence
Rent payable
Subscriptions
Software
Bank charges
Consultancy fees
Accountancy fees
There was no restricted expenditure within the items above.
8.
GRANTS PAYABLE
General
The total grants paid to individuals during the year was as follows:
Malawi Monthly Grants
Malawi Extraordinary Grants
Sponsorship in Malawi

During the year, £28,303 (2023:£6,038) of the Malawi Extraordinary Grants was restricted expenditure.

9. TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 30 June 2024 nor for the year ended 30 June 2023.

Trustees' expenses

There were no trustees' expenses paid for the year ended 30 June 2024 nor for the year ended 30 June 2023.

continued...

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Open Arms Malawi

Notes to the Financial Statements - continued
for the Year Ended 30 June 2024
10.
STAFF COSTS
Wages and salaries
Other pension costs
The average monthly number of employees during the year was as
Charitable activities
No employees received emoluments in excess of £60,000 in either
11.
DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Other debtors
Amounts due from associated or subsidiary undertakings
12.
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Social security and other taxes
Other creditors
Accrued expenses
13.
MOVEMENT IN FUNDS
Unrestricted funds
General fund
Restricted funds
Malawi Grants
TOTAL FUNDS
follows:
year.
At 1.7.23
£
152,372
6,038
158,410
2024
£
61,685
1,102
62,787
2024
4
2024
£
1,578
127
1,705
2024
£
393
216
1,668
2,277
Net
movement
in funds
£
(11,957)
(6,038)
(17,995)
2023
£
59,533
986
60,519
2023
4
2023
£
580
-
580
2023
£
-
214
1,200
1,414
At
30.6.24
£
140,415
-
140,415

continued...

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Open Arms Malawi

Notes to the Financial Statements - continued for the Year Ended 30 June 2024

13. MOVEMENT IN FUNDS - continued

Net movement in funds, included in the above are as follows:

Unrestricted funds
General fund
Restricted funds
Malawi Grants
TOTAL FUNDS
Comparatives for movement in funds
Unrestricted funds
General fund
Restricted funds
Malawi Grants
TOTAL FUNDS
Comparative net movement in funds, included in the above are as
Unrestricted funds
General fund
Restricted funds
Malawi Grants
TOTAL FUNDS
Incoming
resources
£
286,521
22,265
308,786
At 1.7.22
£
208,977
-
208,977
follows:
Incoming
resources
£
257,406
14,116
271,522
Resources
Movement
expended
in funds
£
£
(298,478)
(11,957)
(28,303)
(6,038)
(326,781)
(17,995)
Net
movement
At
in funds
30.6.23
£
£
(56,605)
152,372
6,038
6,038
(50,567)
158,410
Resources
Movement
expended
in funds
£
£
(314,011)
(56,605)
(8,078)
6,038
(322,089)
(50,567)

Restricted funds represent money donated to be distributed as extraordinary grants to Malawi with a restriction on how they may spend it, such as staff bonuses, school fess and house repairs.

14. RELATED PARTY DISCLOSURES

There were no related party transactions in either year.

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Document ID: 931b8453470c7e9b761d2e49510e840e4a1bd5db0e02a4b3a5477d87ebe513e9