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2021-12-31-accounts

Charity Registration No. 1175160

Company Registration No. 10722435 (England and Wales)

ACTION FOR HAPPINESS

(A COMPANY LIMITED BY GUARANTEE)

ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) LEGAL AND ADMINISTRATIVE INFORMATION

Trustees Ms V A King
Professor P R G Layard
Sir Anthony Seldon
Mr G J Mulgan
Secretary Mr M Williamson
Charity number 1175160
Company number 10722435
Registered office WeWork
3 Waterhouse Square
138 Holborn
London
EC1N 2SW
Independent examiner Jean Ellis BA FCA CTA
DSG
Castle Chambers
43 Castle Street
Liverpool
L2 9TL

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) CONTENTS

Page
Trustees' report 1 - 3
Independent examiner's report 4
Statement of financial activities 5
Balance sheet 6
Statement of cash flows 7
Notes to the financial statements 8 - 18

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) FOR THE YEAR ENDED 31 DECEMBER 2021

The trustees present their annual report and financial statements for the year ended 31 December 2021.

The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the charity's Memorandum and Articles of Association , the Companies Act 2006 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) " (effective 1 January 2019 ).

Objectives and activities

Action for Happiness is a charity which promotes mental health and wellbeing through the provision of information, evidence-based resources, public events, educational services, training and community activities.

Our vision is a happier and kinder society, with far fewer people suffering due to mental ill health or social isolation and far more people feeling good, functioning well and helping others. We are backed by leading experts and all of our activities are grounded in the latest scientific research.

Please note: The Action for Happiness project was originally launched in 2011, based within The Young Foundation (Registered Charity 274345). In 2017 Action for Happiness was established as an independent Company Limited by Guarantee (10722435) and registered charity (1175160) and on 31 December 2017 all assets, liabilities and Intellectual Property were transferred to the new entity.

The trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake.

Achievements and performance

Below is a summary of the key Action for Happiness achievements in 20 21 :

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

Financial review

The year’s activities resulted in a surplus of £217,082 compared with a surplus of £ 166,206 in 20 20 .

The total amount transferred by Gift Aid from the subsidiary company Action for Happiness Trading Limited for the year amounted to £ 629 (20 20 : £ 22,380 ). Minimal funds are retained in the subsidiary, the operating expenses of which are paid by the charity.

The princip al sources of income to Action for Happiness during 20 21 were:

Reserves policy

It is the policy of the charitable company that unrestricted funds which have not been designated for a specific use should be maintained at a level equivalent to at least six month’s expenditure. The trustees consider that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the charitable company’s current activities while consideration is given to ways in which additional funds may be raised. This level of reserves has been maintained throughout the year and the charity ended the year with a higher than usual level of reserves due to receiving additional grants during the year which are eligible to support on-going activity next year.

Risk management

The Trustees have assessed the major risks to which the charity is exposed, and are satisfied that systems are in place to mitigate exposure to the major risks.

Future plans

Over the past two years, Action for Happiness’ activities have been significantly impacted by the Covid-19 crisis. At the time of writing, the majority of face-to-face course, events, cafes and other activities continue to be delivered online. While many online activities will continue, it is also hoped that it will be possible to restart more face-to-face activities during 2022 in line with public health guidance and taking into account the preferences of volunteers and participants.

Plans for 2022 now include:

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

Structure, governance and management

The charitable company is a company limited by guarantee .

The trustees, who are also the directors for the purpose of company law, and who served during the year were:

Ms V A King Professor P R G Layard Sir Anthony Seldon Mr G J Mulgan

The Board of Trustees has overall responsibility for the fulfilling the charity’s aims.

The recruitment and appointment of Trustees was based on ensuring an appropriate balance of expertise, skills and commitment to the mission of the charity. The majority of appointed Trustees had either been cofounders of the original Action for Happiness or long-standing members of its Advisory Board. The Board of Trustees also anticipates appointing two or more additional Trustees during the coming year to bring in additional skills and expertise as required.

Day to day management of the operation of the charity is delegated from the Board to the Chief Executive (Mark Williamson). The Board of Trustees meets at least once per quarter and the Chief Executive reports regularly to the Trustees on the operations, plans and financial position of the organisation, as appropriate.

Action for Happiness is supported by a range of contractors and volunteers to fulfil its mission. Contractors are recruited on a fixed term basis with the skills required to fulfil specific needs. All volunteers are carefully screened and supported in fulfilling their roles, for example in running courses in their local communities.

The trustees' r eport was approved by the Board of Trustees.

Professor P R G Layard

Trustee Dated: 15 March 2022

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) INDEPENDENT EXAMINER'S REPORT TO THE TRUSTEES OF ACTION FOR HAPPINESS

I report to the trustees on my examination of the financial statements of Action for Happiness (the charity) for the year ended 31 December 2021.

Responsibilities and basis of report

As the trustees of the charity (and also its directors for the purposes of company law) you are responsible for the preparation of the financial statements in accordance with the requirements of the Companies Act 2006 (the 2006 Act).

Having satisfied myself that the financial statements of the charity are not required to be audited under Part 16 of the 2006 Act and are eligible for independent examination, I report in respect of my examination of the charity’s financial statements carried out under section 145 of the Charities Act 2011 (the 2011 Act) . In carrying out my examination I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the 2011 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 2011 Act. I confirm that I am qualified to undertake the examination because I am a member of ICAEW, which is one of the listed bodies.

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

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 financial statements to be reached.

Jean Ellis BA FCA CTA DSG

Castle Chambers 43 Castle Street Liverpool L2 9TL

Dated: 15 March 2022

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) STATEMENT OF FINANCIAL ACTIVITIES INCLUDING INCOME AND EXPENDITURE ACCOUNT

FOR THE YEAR ENDED 31 DECEMBER 2021

Unrestricted
Restricted
funds
funds
2021
2021
Notes
£
£
Income and endowments from:
Donations and grants
3
84,856
735,000
Charitable activities
4
108,643
-
Investments
5
1,272
-
Other income
6
770
-
Total income
195,541
735,000
Expenditure on:
Charitable activities
7
-
713,459
Net income for the year/
Net movement in funds
195,541
21,541
Fund balances at 1
January 2021
526,133
-
Fund balances at 31
December 2021
721,674
21,541		 Total Unrestricted
Restricted
funds
funds
2021
2020
2020
£
£
£
819,856
125,801
245,000
108,643
131,117
-
1,272
22,380
-
770
520
-
930,541
279,818
245,000
713,459
113,612
245,000
217,082
166,206
-
526,133
359,927
-
743,215
526,133
-		 Total
2020
£
370,801
131,117
22,380
520
524,818
358,612
166,206
359,927
526,133

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) BALANCE SHEET

AS AT 31 DECEMBER 2021

Notes
Fixed assets
Investments
11
Current assets
Debtors
13
Cash at bank and in hand
Creditors: amounts falling due within
one year
14
Net current assets
Total assets less current liabilities
Income funds
Restricted funds
15
Unrestricted funds		 2021
£
3,999
776,493
780,492
(37,278)		 £
1
743,214
743,215
21,541
721,674
743,215		 2020
£
25,885
526,530
552,415
(26,283)		 £
1
526,132
526,133
-
526,133
526,133

The company is entitled to the exemption from the audit requirement contained in section 477 of the Companies Act 2006, for the year ended 31 December 2021.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Trustees on 15 March 2022

Professor P R G Layard

Trustee

Company Registration No. 10722435

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2021

Notes
Cash flows from operating activities
Cash generated from operations
19
Investing activities
Investment income received
Net cash generated from investing
activities
Net cash used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year		 2021
£
1,272		 £
248,691
1,272
-
249,963
526,530
776,493		 2020
£
22,380		 £
143,344
22,380
-
165,724
360,806
526,530

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021

1 Accounting policies

Charity information

Action for Happiness is a private company limited by guarantee incorporated in England and Wales. The registered office is WeWork, 3 Waterhouse Square, 138 Holborn, London, EC1N 2SW.

1.1 Accounting convention

The financial statements have been prepared in accordance with the charity's Memorandum and Articles of Association, the Companies Act 2006, FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the Charities SORP "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 charity is a Public Benefit Entity as defined by FRS 102.

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

The accounts have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2 Going concern

The trustees consider that it is appropriate to prepare the accounts on a going concern basis as the charity will be able to meet its liabilities as they fall due. In making this assessment the trustees have considered the impact of the Coronavirus which is prevalent at the time of approval of these accounts and are confident that they have adequate resources to continue to operate having taken account of current and future income streams and expenditure commitments.

1.3 Charitable funds

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

1.4 Income

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

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

1.5 Expenditure

Resources expended are included in the Statement of Financial Activities on an accruals basis, once there is a legal or constructive obligation to make a payment.

Charitable activities include the cost of providing courses and hosting events, and include both direct costs and support costs relating to these activities.

Governance costs include those incurred in the governance of the charity and its assets and are primarily associated with constitutional and statutory requirements.

Support costs include central functions and have been allocated to charitable activities.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

1 Accounting policies

(Continued)

1.6 Fixed asset investments

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

A subsidiary is an entity controlled by the charity. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.7 Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.8 Financial instruments

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

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

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

Basic financial assets

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

Basic financial liabilities

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

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

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

Derecognition of financial liabilities

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

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

1 Accounting policies

(Continued)

1.9 Employee benefits

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

Termination benefits are recognised immediately as an expense when the charity is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.10 Retirement benefits

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

1.11 Irrecoverable VAT

The charity is not required to register with HMRC for VAT. All resources expended are recognised gross of VAT.

2 Critical accounting estimates and judgements

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

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

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

3 Donations and grants

Unrestricted
Restricted
funds
funds
2021
2021
£
£
Donations and gifts
59,856
-
Grants receivable
25,000
735,000
84,856
735,000
Donations and gifts
Supporters Circle
30,000
-
Other
29,856
-
59,856
-
Grants receivable for
core activities
AIM Foundation
-
-
Founder's Pledge
-
735,000
David Cock Foundation
-
-
Dreamchasing
25,000
-
Small business
COVID-19
-
-
25,000
735,000
Charitable activities
Event income
Course income
Educational services		 Total Unrestricted
Restricted
funds
funds
2021
2020
2020
£
£
£
59,856
65,801
-
760,000
60,000
245,000
819,856
125,801
245,000
30,000
30,000
-
29,856
35,801
-
59,856
65,801
-
-
15,000
-
735,000
-
245,000
-
10,000
-
25,000
25,000
-
-
10,000
-
760,000
60,000
245,000
2021
£
94,595
1,871
12,177
108,643		 Total
2020
£
65,801
305,000
370,801
30,000
35,801
65,801
15,000
245,000
10,000
25,000
10,000
305,000
2020
£
100,446
21,410
9,261
131,117

4 Charitable activities

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

5 Investments

Unrestricted Unrestricted
funds
funds
2021
2020
£
£
Income from subsidiary 629
22,380
Interest receivable 643
-
1,272
22,380

The charity owns 100% of the share capital of Action for Happiness Trading Limited which is a company limited by shares held for the purpose of delivering the charitable trading activities of the charity.

6 Other income

2021 2019
£ £
Other income 770 520

7 Charitable activities

Staff costs
Costs of providing courses
Event costs
Educational services
Communication
Community development
Operations
Share of support costs (see note 8)
Share of governance costs (see note 8)
Analysis by fund
Unrestricted funds
Restricted funds		 2021
£
236,966
41,007
37,321
352
83,739
180,846
8,325
588,556
123,667
1,236
713,459
-
713,459		 2020
£
138,501
49,114
16,582
1,218
48,409
41,094
3,525
298,443
58,933
1,236
358,612
113,612
245,000

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

8 Support costs

Support
costs
Governance
costs
£
£
Bank fees
143
-
General expenses
8,414
-
Online services
91,811
-
Printing and stationery
2,560
-
Travel
272
-
Rent
17,590
-
Insurance
1,182
-
Legal and professional
1,695
-
Independent
examination
-
1,236
123,667
1,236
Analysed between
Charitable activities
123,667
1,236		 2021
Support
costs
Governance
costs
£
£
£
143
84
-
8,414
518
-
91,811
38,612
-
2,560
994
-
272
663
-
17,590
15,990
-
1,182
1,086
-
1,695
986
-
1,236
-
1,236
124,903
58,933
1,236
124,903
58,933
1,236		 2020
£
84
518
38,612
994
663
15,990
1,086
986
1,236
60,169
60,169

9 Trustees

None of the trustees (or any persons connected with them) received any remuneration or benefits from the charitable company during the year (2020: £nil).

During the year, the trustees received a total of £nil (20 20 : £nil) in expenses from the charity.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

10 Employees

The average monthly number of employees during the year was:

Administration
Employment costs
Wages and salaries
Social security costs
Other pension costs
The number of employees whose annual remuneration was £60,000 or
more were:
Above £60,000		 2021
Number
4
2021
£
190,775
21,325
24,866
236,966
2021
Number
1		 2020
Number
2
2020
£
106,000
13,421
19,080
138,501
2020
Number
1

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2021

11 Fixed asset investments

Other
investments
Cost or valuation
At 1 January 2021 & 31 December 2021 1
Carrying amount
At 31 December 2021 1
At 31 December 2020 1
2021 2020
Other investments comprise: Notes £ £
Investments in subsidiaries 12 1 1

This represents the investment in the subsidiary company, Action for Happiness Limited, which is owned by the charity for the purpose of delivering charitable activities.

12 Subsidiaries

Details of the charity's subsidiaries at 31 December 2021 are as follows:

Name of undertaking Registered Nature of business Class of % Held
office shares held Direct Indirect
Action for Happiness Wework, 3 Provision of services Ordinary 100.00
Trading Limited Waterhouse
Square, 138
Holborn,
London, EC1N
2SW

During the year the turnover of Action for Happiness Limited was £30,614 and expenditure incurred was £29,985 resulting in a profit of £629. All of the profit was distributed up to the charity in the period.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

13 Debtors

Amounts falling due within one year:
Trade debtors
Amounts owed by subsidiary undertakings
Other debtors
Prepayments and accrued income
14
Creditors: amounts falling due within one year
Other taxation and social security
Other creditors
Accruals and deferred income		 2021
£
-
629
1,000
2,370
3,999
2021
£
6,127
29,951
1,200
37,278		 2020
£
135
22,380
1,000
2,370
25,885
2020
£
3,776
21,307
1,200
26,283

15 Restricted funds

The income funds of the charity include restricted funds comprising the following unexpended balances of donations and grants held on trust for specific purposes:

Movement in funds Movement in funds Movement in funds Movement in funds
Balance at Incoming Resources Balance at Incoming Resources Balance at
1 January 2020 resources expended
1		 January 2021 resources expended 31 December
2021
£ £ £ £ £ £ £
Founders
Pledge - 245,000 (245,000)
-		 735,000 (713,459)
21,541

Founders Pledge

Development and scale-up of new resources and services to support mental wellbeing for individuals and communities in response to the Covid pandemic.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

16
Analysis of net assets between funds
Unrestricted
funds
Restricted
funds
2021
2021
£
£
Fund balances at 31
December 2021 are
represented by:
Investments
1
-
Current assets/
(liabilities)
721,673
21,541
721,674
21,541		 TotalUnrestricted
funds
Restricted
funds
2021
2020
2020
£
£
£
1
1
-
743,214
526,132
-
743,215
526,133
-		 Total
2020
£
1
526,132
526,133

17 Operating lease commitments

At the reporting end date the charity had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2021 2020
£ £
Within one year 7,840 9,102

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2021

18 Related party transactions

The charity has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

19
Cash generated from operations
Surplus for the year
Adjustments for:
Investment income recognised in statement of financial activities
Movements in working capital:
Decrease/(increase) in debtors
Increase in creditors
Cash generated from operations		 2021
£
217,082
(1,272)
21,886
10,995
248,691		 2020
£
166,206
(22,380)
(15,255)
14,773
143,344