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2021-12-31-accounts

THE SINO-BRITISH FELLOWSHIP TRUST

THE SINO-BRITISH FELLOWSHIP TRUST (Charitable Incorporated Organisation) Registered Charity Number 1174487

REPORT AND FINANCIAL STATEMENTS

31 DECEMBER 2021

THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021

REFERENCE, LEGAL AND ADMINISTRATIVE INFORMATION

Trustees

Mrs A.E. Ely, Chairman of the Trustees Emeritus Professor H.D.R Baker, BA, PhD Mr P. J. Ely, BA(Hons), IPFA, Deputy Chairman Emeritus Professor R.J. Foot, FBA Sir C. Hum, KCMG Professor W.W.C. Luk, FREng, CEng, CITP, FBCS, MIET, FIEEE Mrs L. Thompson, OBE Dr F. Wood

Honorary Advisors

Lady P. Youde, OBE Mrs H. Day

Office

23 Bede House Manor Fields Putney Heath London SW15 3LT

Bankers

CAF Bank 25 Kings Hill Avenue Kings Hill West Malling Kent ME19 4TA

Solicitors

Farrer & Co 66 Lincoln’s Inn Fields London WC2A 3LH

Investment Advisers

CCLA Investment Management Ltd Senator House, 85 Queen Victoria Street London EC4V 4ET

Investment Custodian

HSBC Securities Services 8 Canada Square Canary Wharf, London E14 5HQ

Auditor

Chariot House Ltd Chartered Accountants 25F Copperfield Street London SE1 OEN

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

The trustees present their report along with the financial statements of the Charitable Incorporated Organisation (CIO) for the period ended 31 December 2021. The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the accounts and comply with the CIO’s Constitution, the Charities Act 2011 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 (effective 1 January 2019).

OBJECTIVES

The CIO budgets to spend the income available for grants each year, based on the estimated investment income, in furtherance of the Objects stated below;

In advancing education and training in any subject:

SIGNIFICANT ACTIVITIES

Annual grants to Institutions amounted to £ 112,960 (2020 £237,500) and individual grants of £ 21,171 (2020 £ 15,960) were awarded during the year.

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

PUBLIC BENEFIT

The Trustees confirm that they have complied with the duty in section 17 of the Charities Act 2011 to have due regard to public benefit guidance published by the Charity Commission in determining the activities undertaken by the CIO.

The CIO seeks to advance education (a statutory charitable purpose under the Charities Act 2011) through support for academic research exchanges between the UK and China. The public benefits of academic research are well recognised. The CIO supports researchers in a wide range of fields, in the sciences, social sciences, humanities and the arts. This year travel between the UK and China was severely disrupted, which presented considerable difficulties for researchers.

Grants given during the year supported academics in continuing their research work despite the problems. Examples were:

Funding to enable doctoral researchers from British Universities to conduct field work in China when they were able to travel; this supported them in completing their research, with the aim of publication in academic journals and through conferences.

Funding to support doctoral researchers from China, already studying in the UK, to enable them to complete their research work, with the aim of publication as above.

Funding to enable researchers in China to take part in projects with British institutions; during the pandemic such work began with online study and exchange, with physical visits planned take place when the situation permits.

Funding to support academics to improve their understanding of Chinese languages; again such study has been largely online, with grants given on the understanding that travel to and study in China would take place when possible.

GRANT MAKING POLICY

The CIO receives applications for grants from individuals and also makes annual grants to institutions. If the applications are within the CIO’s Objects and Terms of Reference, grants are awarded provided funds are available. The institutions supply details of the awards made from their annual grants and the trustees ensure these comply with the Objects and Terms of Reference for individual applications.

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

ACHIEVEMENTS AND PERFORMANCE

The Covid-19 pandemic continued to dominate in 2021, affecting the work of the CIO. Travel between the UK and China was greatly affected, which limited the amount of research collaboration. No grants were given to overseas organisations in 2021. The CIO continued to keep contact with those organisations who would usually receive grants to maintain support as far as possible, and the partnership with Hong Kong Metropolitan University (formerly the Open University of Hong Kong) was reviewed to facilitate future exchanges with British universities. In the UK 4 organisations received grants – the British Museum, the Great Britain-China Educational Trust, Kingston University and the Universities China Committee London. The CIO also maintained contact with other UK organisations who usually receive grants.

2021 saw the introduction of the Sino-British Fellowship Trust website. Of the 5 individual grants awarded by the CIO during the year, 3 began as enquiries through the website.

FINANCIAL REVIEW AND INVESTMENT POLICY

The income of the CIO derives solely from its investments and no appeals are made to the general public or any government agency for funds. Total income for the year to 31 December 2021 amounted to £418,580 (2020 £440,809). The cost of raising funds £82,101 (2020 £77,774) are the investment managers fees which are charged to the expendable endowment fund. Expenditure on charitable activities amounted to £204,204 (2020 £ 313,547) The grants awarded were significantly less than in a normal year because of the impact of the pandemic. The net incoming resources for the Unrestricted fund were £ 214,376 (2020 £127,262). The general reserves increased to £1,300,749 from £1,086,373 in the previous period.

In accordance with the powers given in the Constitution the trustees have delegated responsibility for the management of the investment portfolio to HSBC Private Bank (U.K.) Ltd., the investment advisers.

The investment policy is to obtain a reasonable long-term overall return at a moderate level of risk. Performance is monitored by the Investment Committee of Mrs A.E. Ely, Mr P.J. Ely, Mrs L. Thompson and Dr F. Wood. There was considerable market volatility through the year, with the final value of the endowment fund increasing by £1,477,930 to £ 18,325,689. The performance of the investment portfolio (net of fees) was an increase of 8.77% (2020 decreased by 0.27%) compared with the benchmark increase of 7.63 % The UK CPI (UK inflation) for the same period was 4.8% and the target for the long term for the fund is to beat inflation, net of fees .

During 2021 the CIO reviewed its investment approach and conducted an extensive review of investment managers. The Trustees finally decided that the interests of the CIO would be best served by a change of manager and appointed CCLA to take over in 2022.

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

RISK MANAGEMENT

The trustees are responsible for the CIO’s risk management mitigation systems and reviewing procedures. The trustees have examined the major strategic, business and operational risks which the CIO faces and confirm that systems have been established to enable regular reports to be produced so that the necessary steps can be taken to mitigate these risks. The systems are reviewed annually by the Finance Committee and Board.

FUTURE PLANS AND CHARITABLE STATUS

Throughout the pandemic the Trustees have been concerned to support academic researchers in continuing their work when possible. The CIO has placed emphasis on maintaining contact with partner organisations to identify the best opportunities to support their recovery from the pandemic. Future plans are to develop existing partnerships and, where appropriate, new collaborations, to continue grant making in accordance with the CIO’s objectives.

RESERVES POLICY

The trustees have agreed to retain sufficient funds to cover 3 months expenditure. Should the cash reserves be forecast to fall below this figure, depending on the cash flow requirements at the time, the trustees may at their discretion determine to draw on capital to ensure sufficient funds are available to meet the budgeted expenditure. In the opinion of the trustees the assets of the CIO are sufficient to meet its liabilities on a fund by fund basis. The trustee’s powers of investment to expend capital and income are not restricted in the Constitution of the CIO. In accordance with the original wishes of those providing funds to set up the former charity, the trustees reclassified the Investment Fund as Expendable Endowment Funds, representing the residue of the original funding, and the remainder, representing net incoming resources for the year, as the Unrestricted Funds

In considering the amount of income available for grants the trustees have in mind the following criteria:

  1. Amounts should be retained to provide for future plans and commitments, and

  2. Unrealised investment gains should be retained as part of the Expendable Endowment Funds to cover the risk of any future downturn in the market.

The trustees believe that grants where possible should continue to be awarded subject to the quality of the applications received. The remaining funds should be maintained at a level which is suitable to allow the trustees to ensure the level of working capital is sufficient to meet the day to day needs of the CIO.

The free reserves of the CIO at 31 December 2021 were £1,035,183 (2020 £ 815,959).

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

STRUCTURE, GOVERNANCE AND MANAGEMENT

The Sino-British Fellowship Trust is a Charitable Incorporated Organisation (CIO) registered on 4[th] September 2017. The registered charity number is 1174487. The CIO was set up to take over the work of the charity of the same name (registered charity number 313669). The assets of the former charity were transferred to the CIO on 1[st] April 2018 and the former charity is now entered on the Register of Merged Charities.

The trustees are set out on page 1. Trustees are appointed by the existing trustees and serve for a period of five years after which period they may put themselves up for re-appointment. The trustees meet at least twice a year to agree on the award of grants and to discuss the aims of the CIO. The day to day management of the CIO has been delegated to Mrs A. E. Ely and Mr P. J. Ely. The CIO also has committees that are delegated the responsibility for overseeing and monitoring key areas of activity within the organisation and reporting to the Board of Trustees. In the opinion of the trustees the operations of the CIO in the past 12 months in reviewing and approving grant applications are in accordance with its objects.

TRUSTEE RECRUITMENT AND TRAINING

The board of trustees consists of at least five members who, as charity trustees, have the legal responsibility for the effective use of the CIO’s resources in accordance with the Objects and Terms of Reference of the CIO. Trustees are not remunerated but reasonable expenses are paid.

The CIO does not have an active policy to recruit new trustees, but approaches peoples known to have an interest in related activities or who have worked for Institutions the CIO has supported with grants.

Every prospective trustee is provided with information about the CIO’s constitution, policies and activities together with information on the Charity Commission guidance. Trustees are offered the opportunity to attend further training courses should they wish to do so.

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THE SINO-BRITISH FELLOWSHIP TRUST

ANNUAL REPORT OF THE TRUSTEES FOR THE PERIOD ENDED 31 DECEMBER 2021 (continued)

STATEMENT OF TRUSTEES’ RESPONSIBILITIES FOR THE FINANCIAL STATEMENTS

The trustees are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

The law applicable to charities in England and Wales requires the trustees to prepare financial statements for each financial period which give a true and fair view of the state of affairs of the CIO and of the incoming resources and application of resources of the CIO for that period. In preparing these financial statements the trustees are required to:

  1. select suitable accounting policies and apply them consistently;

  2. observe the methods and principles in the Charities SORP;

  3. make judgements and estimates that are reasonable and prudent;

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

  5. prepare financial statements on the going concern basis unless it is inappropriate to assume that the CIO will be able to continue in operation.

The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the CIO and enable them to ensure that the financial statements comply with the Charities Act 2011, the applicable Charity (Accounts and Reports) Regulations and the provisions of the CIO’s constitution. They are also responsible for safeguarding the assets of the CIO and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Approved by the trustees on 30[th] June 2022 and signed on their behalf by:

Mrs A.E. ELY Chairman

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THE SINO-BRITISH FELLOWSHIP TRUST

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE SINO-BRITISH FELLOWSHIP TRUST FOR THE PERIOD ENDED 31[ST] DECEMBER 2021

Opinion

We have audited the financial statements of Sino-British Fellowship Trust (the CIO) for the period ended 31 December 2021 which comprise the Statement of Financial Activities, the Balance Sheet, the Cash Flow Statement 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).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the CIO in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the CIO’S ability to continue as a going concern for a period of at least 12 months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The trustees are responsible for the other information. The other information comprises the information included in the annual report, including the trustees report, other than the financial statements and our Report of the Independent Auditors 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.

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THE SINO-BRITISH FELLOWSHIP TRUST

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE SINO-BRITISH FELLOWSHIP TRUST FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (continued)

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the CIO and its environment obtained in the course of the audit, we have not identified any material misstatements in the trustees report .

We have nothing to report in respect of the following matters where the Charities (Accounts and Reports) Regulations 2008 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the Statement of Trustees' Responsibilities set out on page 7, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the CIO’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 CIO or to cease operations, or have no realistic alternative but to do so.

Our responsibilities for the audit of the financial statements

We have been appointed as auditor under the Charities Act 2011, section 144 and report in accordance with regulations made under 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 a Report of the Independent Auditors 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.

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THE SINO-BRITISH FELLOWSHIP TRUST

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE SINO-BRITISH FELLOWSHIP TRUST FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (continued)

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:

Based on our understanding of the charity and its activities, and through discussion with the trustees and management, we identified the principal risks and considered the extent to which these would have a material impact on the financial statements. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

We obtained an understanding of the legal and regulatory framework that the charity operates in, focusing on those laws and regulations that had a material effect on the financial statements or that had a fundamental effect on the operations of the charity from our professional and sector experience.

We performed analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud, and reviewed significant or unusual transactions to identify their underlying supporting rationale.

We inspected the minutes of meetings of those charged with governance, and made direct enquiries of management and the board of trustees concerning the charity's policies and procedures relating to:

In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments, assessed whether the judgements made in making accounting estimates were indicative of a potential bias and tested significant transactions that are unusual or those outside the normal course of business.

We also:

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors.

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THE SINO-BRITISH FELLOWSHIP TRUST

REPORT OF THE INDEPENDENT AUDITORS TO THE TRUSTEES OF THE SINO-BRITISH FELLOWSHIP TRUST FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (continued)

Use of our report

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

Signed Chariot House Ltd

Date: 30[th] June 2022 Chariot House Ltd Chartered Accountants 25F Copperfield Street London SE1 OEN

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THE SINO-BRITISH FELLOWSHIP TRUST

STATEMENT OF FINANCIAL ACTIVITIES FOR THE PERIOD ENDED 31[ST] DECEMBER 2021

INCOME AND ENDOWMENTS
Income from investments (Note 3)
Interest
TOTAL INCOME
EXPENDITURE
Costs of raising funds
Investment management fee (Note 1h)
Expenditure on Charitable Activities (Note
5)
Grants to British academics for study visits to
China – object (a)
Grants to Chinese academics for study visits
to Great Britain – object (b)
Promotion of Chinese language studies –
object (c)
Joint UK /China academic programmes, and
exchanges between Hong Kong and other
parts of China – object (d)
TOTAL EXPENDITURE
NET INCOME/(EXPENDITURE)
BEFORE GAINS AND LOSSES ON
INVESTMENTS
Net investment gains/(losses):
NET INCOME/(EXPENDITURE)
Transfer between funds (Note 8)
NET MOVEMENT IN THE FUNDS FOR THE
YEAR		 Unrestricted
Fund
£
418,486
94
418,580
65,846
127,701
10,657
0
204,204
214,376
214,376
214,376		 Expendable
Endowment
Fund
£
0
82,101
82,101
(82,101)
1,560,031
1,477,930
1,477,930		 December
2021
Total
£
418,486
94
418,580
82,101
65,846
127,701
10,657
0
286,305
132,275
1,560,031
1,692,306
1,692,306		 December
2020
Total
£
440,227
582
440,809
77,774
67,544
220,025
11,752
14,226
391,321
49,488
(434,239)
(374,751)
-
(374,751)

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THE SINO-BRITISH FELLOWSHIP TRUST

STATEMENT OF FINANCIAL ACTIVITIES FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (continued)

RECONCILIATION OF FUNDS
NET MOVEMENT IN THE FUNDS
FOR THE YEAR
Funds Brought Forward
At 1st January 2021
FUNDS CARRIED FORWARD
31 DECEMBER 2021
Represented by:
Tangible fixed assets
Fixed assets investments
Net current assets
TOTAL NET ASSETS
31 December 2021		 Unrestricted
Fund
£
214,376
1,086,373
1,300,749
265,566
1,035,183
1,300,749		 Expendable
Endowment
Fund
£
1,477,930
16,847,759
18,325,689
17,613,957
711,732
18,325,689		 December
2021
£
1,692,306
17,934,132
19,626,438
265,566
17,613,957
1,746,915
19,626,438		 December
2020
£
(374,751)
18,308,883
17,934,132
270,414
16,763,328
900,390
17,934,132

The notes on pages 16 to 26 form part of these financial statements

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THE SINO-BRITISH FELLOWSHIP TRUST

BALANCE SHEET AS AT 31[ST] DECEMBER 2021

FIXED ASSETS
Tangible Assets (Note 2b)
Leasehold property
Furnishings
Computer Equipment
Total Fixed Assets
Investments (Note 2a)
CURRENT ASSETS
Debtors, prepayments and accrued income
Income due from broker
Investment cash held by broker (Note 2a)
Cash at bank and in hand
Total Current Assets
CURRENT LIABILITIES
Creditors:Amounts falling due within one
year
Grants payable
Other creditors and accruals
Total Current Liabilities
Net current assets
NET ASSETS
THE FUNDS OF THE CHARITY (Note 1b)
Expendable Endowment (note 2a)
General fund
TOTAL CHARITY FUNDS		 December 2021
£
3,603
10,227
732,199
1,085,370
1,831,399
56,300
28,184
84,484
 December
2021
£
262,987
1,696
883
265,566
17,613,957
1,746,915
19,626,438
18,325,689
1,300,749
19,626,438
______		 December
2020
£
268,354
1,884
176
270,414
16,763,328
3,422
9,777
104,309
867,600
985,108
56,300
28,418
84,718
900,390
17,934,132
16,847,759
1,086,373
17,934,132
_____

Approved by the Trustees on 30 June 2022 and signed on their behalf

A.E. ELY ) ) ) Trustees P.J.ELY ) )

P.J.ELY

The notes on pages 16 to 26 form part of these financial statements

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THE SINO-BRITISH FELLOWSHIP TRUST

STATEMENT OF CASHFLOWS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021

Note 7
Cashflows from operating activities
Cashflows from investing activities
Investment income
Rounding
Purchase of fixed assets
Proceeds from sale of investments
Nil paid rights issue
Purchase of investments
Net cash provided by investing activities
Note 8
Change in cash and cash equivalents in the period
Cash and cash equivalents at 1 January 2021
Cash and cash equivalents at 31st December 2021		 2021
£
(280,872)
418,580
(1,000)
8,868,481
4,521
(8,163,600)
1,126,982
846,110
981,686
1,827,796		 2020
£
(511,305)
440,809
2
-
10,538,072
(10,652,193)
366,690
(184,615)
1,166,301
981,686

The notes on pages 16 to 26 form part of these financial statements

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021

The Sino British Fellowship Trust is a charitable incorporated organisation which is registered with the Charity Commission in England and Wales Number 1174487.

1. ACCOUNTING POLICIES

a) Basis of preparing the financial statements

The financial statements of the charitable incorporated organisation, which is a public benefit entity under FRS 102, have been prepared in accordance with the Charities SORP (FRS 102) 'Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)'. The financial statements have been prepared under the historical cost convention.

b) Fund Accounting

The expendable endowment fund represents the charity’s investments. The fund includes cash held by the CIO’s brokers, who have a discretionary management agreement. Investment gains, losses and management fees are included in the expendable endowment fund.

c) Income recognition

Investment income and interest are recognised under the accruals concept. Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the CIO; this is normally upon notification of the interest paid or payable by the bank. Dividends are recognised once the dividend has been declared and notification has been received of the dividend due. This is normally upon notification by our investment advisor of the dividend yield of the investment portfolio.

d) Expenditure recognition

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

Resources expended are recognised under the accruals concept. Support costs represent the expenditure incurred in making and controlling grant awards. Governance costs represent the other expenditure associated with the constitutional and statutory requirements of the CIO.

e) Irrecoverable VAT

Irrecoverable VAT is charged against the category of resources expended for which it was incurred.

f) Taxation

The CIO is exempt from tax on its charitable activities.

g) Depreciation

Tangible fixed assets above a value of £500 are capitalised and are depreciated over their estimated useful life at the following rates:-

Leasehold property 2% on reducing balance
Furnishings 10% on reducing balance
Equipment 25% on reducing balance

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NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

1. ACCOUNTING POLICIES (Continued)

h) Critical accounting judgements and key sources of estimation uncertainty

The charity makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing material adjustment to the carrying amounts of the assets and liabilities within the next financial year are addressed below.

Useful economic lives of tangible assets:

The annual depreciation charge for tangible assets in sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect the current estimates, based on technological advancement, future investments, economic utilisation and physical condition of the assets. See accounting policy note (above) for useful economic lives for each class of assets.

i) Fixed asset Investments

Investments are revalued to market value as at the balance sheet date and the surplus or deficit of this revaluation is shown as unrealised gains or losses on the face of the Statement of Financial Activities. Realised gains and losses represent the difference between the sales proceeds and the opening market value or their purchase value if acquired subsequent to the first day of the financial period. Unrealised gains and losses are calculated as the difference between the fair value at the period end and their carrying value.

The main form of financial risk faced by the CIO is that of volatility in investment markets.

j) Costs of raising funds

Costs of raising funds comprise those costs directly attributable to managing the investment portfolio and raising investment income.

k) Charitable activities

Expenditure on charitable activities includes grants made, together with governance costs and support costs apportioned pro rata to the grants awarded, as shown in note 5.

l) Grants

Grants to institutions are recognised in the Statement of Financial Activities in the period in which the commitment is made, subject to the fulfilment of the conditions which apply to each grant. Grants whose conditions have been fulfilled, but which have not yet been paid are recognised as a liability in the balance sheet. Grants which have been agreed in principle but whose conditions have not yet been fulfilled are not considered material.

Grants to individuals are recognised in the Statement of Financial Activities in the period in which the commitment is made.

m) Going concern

The finance statements have been prepared on a going concern basis as the trustees believe that no material uncertainties exist. The trustees have considered the level of funds held and the expected level of income and expenditure for 12 months from authorising these financial statements. The budgeted income and expenditure is sufficient with the levels of reserves for the charity to be able to continue as a going concern.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

2(a). FIXED ASSET INVESTMENTS

Movement in fixed asset listed investments

Market value at 31 December 2020
Additions to investments at cost
Disposals
Rights issue - nil paid SSP
Net gains /(losses)
Market value as at 31 December 2021
Euro adjustment
Cash held by broker
Management fee creditor
Expendable Endowment Fund
Investments at market value comprised:
Fixed Income Funds
Equity Mutual Funds
Equities
Other		 December
2021
£
16,763,328
8,163,600
(8,868,481)
(4,521)
1,560,031
17,613,957
42
732,199
18,346,198
(20,509)
18,325,689
December
2021
£
4,330,119
10,069,865
1,982,586
1,231,387
17,613,957		 December
2020
£
17,073,446
10,652,193
(10,538,072)
(434,239)
16,763,328
43
104,309
16,867,680
(19,921)
16,847,759
December
2020
£
4,635,739
8,881,642
1,758,584
1,487,363
16,763,328

18

THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

2(b). TANGIBLE FIXED ASSETS

Cost:
At 31 December 2020
Additions during the period
Depreciation:
At 31 December 2020
Charge for the period
Net book value:
At 31 December 2021
Net book value
At 31 December 2020		 Leasehold
Property
£
285,280
-
285,280
16,926
5,367
22,293
262,987
268,354		 Furnishings
£
2,514
-
2,514
630
188
818
1696
1,884		 Computer
Equipment
£
384
1,000
1,384
208
293
501
883
176		 Total
£
288,178
1,000
289,178
17,764
5,848
23,612
265,566
270,414

The leasehold property was bought in at a net value of £285,280 from the former charity whose work the CIO took over. The original cost in 2005 was £388,138.

The leasehold property is situated at 23 Bede House, Manor Fields, London, SW15 3LT and is held on a 999 year lease from 1 April 1984. It includes garage number 144 which is held on a 99 year lease from 1 April 1969.

All assets are held for the use of charitable purposes.

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

3. INVESTMENTS

3 (a) Investment income is analysed as follows:
Fixed Income Funds
Equity Mutual Funds
Equities
Other		 December
2021
£
127,738
167,869
89,959
32,920
418,486		 December
2020
£
145,748
202,916
60,345
31,218
440,227

3 (b) Investments where the market values are considered to be material are:

Number of Number of December December
Shares Shares 2021 2020
2021 2020 £ £
Fixed Income Funds
HSBC Global Investment Funds – Global Asset–
Backed Bond		 45,791 45,971 448,631
446,148
HSBC GIF Global Government Bond 104,133 0 1,105,164
0
HSBC Global Investment Funds Emerg Mkts Local
Debt Z		 94,747 169,016 600,467
1,371,102
Equity Mutual Funds
HSBC Index tracker Inv Fund FTSE all world index 295,387 0 656,350
___
HSBC FTSE All Share Index Fund 457,709 921,696 1,650,041
2,913,482
HSBC Index Tracker Investment Funds American
index		 55,574 211,324 536,789
1,575,633
HSBC Multi Fac Shares 82,713 85,008 911,236
785,859
HSBC US MltFA Institutional shares 209,942 209,942 1,183,447
885,958
Ishares Core MSCI EM IMI 287,161 187,424 1,134,046
751,373
Ishares IVplcUSA Quality factor 713 0 922,296
0
Other
Charities Property Fund 620,874 657,987 807,943
815,575

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

4. GOVERNANCE AND SUPPORT COSTS

Support costs

As stated in Note 1(d) support costs represent an apportionment of costs spent in making and controlling grant awards. The Trustees consider that the following costs are a reasonable allocation under this heading.

Secretarial, financial and clerical assistance
Establishment expenses
Stationery, telephone, computer and website
General expenses
AGM and student liaison costs
Depreciation		 December 2021
£
21,219
13,686
2,976
938
231
5,848
44,898		 December 2020
£
21,002
13,848
2,619
673
1,488
5,743
45,373

Governance costs

As stated in Note 1(d) governance costs are the costs associated with constitutional and statutory requirements of the CIO. The following costs have been incurred under this heading:

Professional fees for investment review
Accountancy fees
Audit fees
Trustees travel costs
Bank charges and interest		 December 2021
£
11,880
8,680
4,200
100
315
25,175		 December 2020
£
9,398
5,040
258
18
14,714

Total support and governance costs are apportioned pro rata to the grants awarded as shown in note 5.

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

5. CHARITABLE ACTIVITIES

Grants to British academics for study
visits to China – object (a)
UK Institutions:
Needham Research Institute
St. Antony’s College
Universities China Committee London
Overseas Institutions:
Lingnan University
Individuals (3)
Grants to Chinese academics for study
visits to Great Britain – object (b)
UK institutions:
British Museum
China Kadoorie Biobank
Great Britain China Educational Trust
Kingston University
Needham Research Institute
Royal Society
St Cross College, University of Oxford
Overseas Institutions:
Hong Kong University
Lingnan University
Open University of Hong Kong
Vocational Training Council
China Scholarship Council
Individuals (2)		 Grants
£
-
-
31,000
-
12,251
43,251
12,000
960
47,000
15,000
-
-
-
-
-
-
-
-
8,920
83,880		 Support and
governance
costs
£
16,195
6,400
22,595
6,269
502
24,554
7,836
4,660
43,821		 December
2021
Total
£
65,846
127,701		 December
2020
£
4,948
13,608
38,349
10,639
-
67,544
-
-
57,524
-
12,371
87,832
18,556
(24,741)
9,154
15,463
15,463
11,134
17,269
220,025

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

CHARITABLE ACTIVITIES (continued)
Promotion of Chinese language studies –
object (c)
UK Institutions
Great Britain China Educational Trust
Universities China Committee London
Individuals (0)
Joint UK /China academic programmes,
and exchanges between Hong Kong and
other parts of China – object (d)
Chinese Institutions:
Lingnan University
Open University of Hong Kong
TOTAL GRANTS FOR YEAR		 Grants
£
3,000
4,000
-
7,000
-
-
0
134,131
 Support and
governance
costs
£
1,567
2,090
3,657
0
70,073		 December
2021
Total
£
10,657
0
204,204		 December
2020
£
4,330
4,948
2,474
11,752
4,948
9,278
14,226
313,547

There were 5 (2020: 3) grants to individuals during the year.

The CIO is committed to spending £516,075 (2020: £ 560,620) in respect of grants within the following year and £617,770 (2020:£1,007,865) in the two years of 2023 and 2024. Most grants are approved on a 3 year basis with an annual payment each year and many long established grants are renewed after the 3 year period has expired.

6. STAFF COSTS

STAFF COSTS
Salaries and wages
Employer pension contributions		 December
2021
£
20,601
618
21,219		 December
2020
£
20,390
612
21,002

1 part time member of staff has been employed through the year.

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

CASHFLOW STATEMENT

Note 7

Note 7
December December
2021 2020
£ £
Net income/ (expenditure) for the period to 31st December 2021 1,692,306 (374,751)
Adjustments for:
Depreciation charges 5,848 5,743
(Gains)/losses on investments (1,560,031) 424,239
Investment income (418,580) (440,809)
(Increase)/decrease in debtors (181) 622
Increase/(decrease) in creditors (234) (126,349)
Net cash provided/(used) operating activities (280,872) (511,305)
Note 8
December December
2021 2020
Analysis of cash and cash equivalents
Cash held as part of investment portfolio 742,426 114,086
Cash at bank and in hand 1,085,370 867,600
Total cash and cash equivalents 1,827,796 981,686

9. TRUSTEES

No trustee received any remuneration for this period (2020: Nil) but travelling expenses for relevant charitable activities were paid as necessary.

10. RELATED PARTIES

During the period grants were paid to the Great Britain China Educational Trust. This institution has a trustee in common with the charity. The grant is reviewed annually and have been approved unanimously at Trustees meetings.

The furnishings in Bede House were donated to the former Charity in 2005 by the Elizabeth Frankland Moore Foundation and the foundation has a trustee in common with the Charity.

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THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

11. COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES

2020
INCOME AND ENDOWMENTS
Income from investments (Note 3)
Interest
TOTAL INCOME
EXPENDITURE
Costs of raising funds
Investment management fee (Note 1h)
Expenditure on Charitable Activities
(Note 5)
Grants to British academics for study visits
to China – object (a)
Grants to Chinese academics for study
visits to Great Britain – object (b)
Promotion of Chinese language studies –
object (c)
Joint UK /China academic programmes,
and exchanges between Hong Kong and
other parts of China – object (d)
TOTAL EXPENDITURE
NET INCOME/(EXPENDITURE)
BEFORE GAINS AND LOSSES ON
INVESTMENTS
Net investment gains/(losses):
NET INCOME/(EXPENDITURE)
Transfers between funds
NET MOVEMENT IN THE FUNDS FOR
THE YEAR		 Unrestricted
Fund
£
440,227
582
440,809
67,544
220,025
11,752
14,226
313,547
127,262
127,262
-
127,262		 Expendable
Endowment
Fund
£







77,774


77,774

(77,774)
(424,239)



(502,013)
-

(502,013)		 December
2020
Total
£
440,227
582

440,809



77,774
67,544
220,025
11,752
14,226

391,321

49,488
(424,239)

(374,751)
-
(374,751)

25

THE SINO-BRITISH FELLOWSHIP TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31[ST] DECEMBER 2021 (Continued)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31ST DECEMBER 2021 (Continued)		 NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31ST DECEMBER 2021 (Continued)		 NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31ST DECEMBER 2021 (Continued)		 NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31ST DECEMBER 2021 (Continued)
11. COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES (continued)
Unrestricted Expendable December 2020
Fund Endowment
Fund Total
£ £ £
RECONCILIATION OF FUNDS
NET MOVEMENT IN THE FUNDS
FOR THE YEAR 127,262 (502,013)
 (374,751)
Funds Brought Forward
At 1st January 2020 959,111 17,349,772


 18,308,883
FUNDS CARRIED FORWARD 1,086,373 16,847,759 17,934,132
31 DECEMBER 2020
Represented by:
Tangible fixed assets 270,414 270,414
Fixed assets investments 16,763,328 16,763,328
Net current assets 815,959 84,431
 900,390
TOTAL NET ASSETS
31 DECEMBER 2020 1,086,373 16,847,759 17,934,132

12. CORONAVIRUS COVID 19 UPDATE

As mentioned in the Trustees report the Covid-19 pandemic continued to have a significant impact on the work of the CIO. The development of new variants, which caused continuing travel disruption, meant that many organisations were unable to use their grant allocation for 2021. During the year the CIO kept in close touch with partner organisations and individual grant beneficiaries, aiming to maintain support as far as possible as plans were changed in the light of the pandemic. At a recent meeting with partner organisations there was considerable optimism that the situation would improve in the latter part of 2022, particularly with the increased use of online facilities.

The income of the CIO all comes from our investments. The pandemic and other world events have contributed to considerable market volatility. However our investments are now managed on a total return basis and we are not expecting income paid to the CIO to drop below the level agreed with our investment managers in 2022 or in future years. Despite this, detailed forecasts have been prepared and the existing free reserves of £1,035,183 provide sufficient cover to fund all regular and expected grants through to 2025 if income does drop below expected levels. The CIO also has the flexibility to consider drawing down some capital to fund expenditure without jeopardising the long term future of the CIO.

26