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2022-12-31-accounts

Charity registration number 1175160

Company registration number 10722435 (England and Wales)

ACTION FOR HAPPINESS

(A COMPANY LIMITED BY GUARANTEE)

ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022

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 Ms Julie Bentley (Appointed 23 June 2022) Radha Modgil (Appointed 23 June 2022) Michiel Nolet (Appointed 23 June 2022) 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 - 4
Independent examiner's report 5
Statement of financial activities 6
Balance sheet 7
Notes to the financial statements 8 - 16

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) FOR THE YEAR ENDED 31 DECEMBER 2022

The trustees present their annual report and financial statements for the year ended 31 December 2022.

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

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2022

Financial review

The year’s activities resulted in a net deficit of £119,279 compared with a surplus of £217,082 in 2021. We had anticipated that expenditure would exceed income during the year and this was enabled by having ended the previous period with a higher than normal level of reserves.

The total amount transferred by Gift Aid from the subsidiary company Action for Happiness Trading Limited for the year amounted to £19,681. Minimal funds are retained in the subsidiary, the operating expenses of which are paid by the charity.

The principal sources of income to Action for Happiness during 2022 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. The current level of reserves was reduced during 2022 but still remains higher than usual. Reserves will continue to be put to use in 2023 and are expected to return to the normal level of around six month’s expenditure over the coming years.

Risk management

The charitable company maintains a Risk Register which is reviewed regularly by the Board. 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.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2022

Future plans

Plans for 2023 include:

Structure, governance and management

The charitable company is a company limited by guarantee.

The trustees, four of whom 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 Ms Julie Bentley (Appointed 23 June 2022) Radha Modgil (Appointed 23 June 2022) Michiel Nolet (Appointed 23 June 2022)

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. Three new Trustees were appointed during the year, following an extensive recruitment process. One of the original Action for Happiness co-founding Trustees also stepped down during the year. The Board of Trustees also anticipates appointing one or more additional Trustees during the years ahead 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' report was approved by the Board of Trustees.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) TRUSTEES' REPORT (INCLUDING DIRECTORS' REPORT) (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2022

Small company provisions

This report has been prepared in accordance with the special provisions relating to small companies within Part 15 of the Companies Act 2006.

The trustees' report was approved by the Board of Trustees.

Professor P R G Layard

Trustee Dated: 10 May 2023

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 2022.

This report is made solely to the charity’s trustees, as a body, in accordance with section 145 of the Charities Act 2011. My work has been undertaken so that I might state to the charity’s trustees those matters I am required to state to them in this report and for no other purpose. To the fullest extent permitted by law, I do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for my work, for this report, or for the opinions I have formed.

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: 10 May 2023

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

FOR THE YEAR ENDED 31 DECEMBER 2022

Unrestricted Unrestricted Unrestricted Restricted Restricted Total Unrestricted Unrestricted Restricted Total
funds funds funds funds
2022 2022 2022 2021 2021 2021
Notes £ £ £ £ £ £
Income and endowments from:
Donations and
grants 3 125,542 130,500 256,042 84,856 735,000 819,856
Charitable activities 4 69,888 - 69,888 108,643 - 108,643
Investments 5 20,788 - 20,788 1,272 - 1,272
Other income 6 887 - 887 770 - 770
Total income 217,105 130,500 347,605 195,541 735,000 930,541
Expenditure on:
Charitable activities 7 314,842 152,041 466,883 - 713,459 713,459
Net (expenditure)/income
for the year/
Net movement in funds (97,737) (21,541)
(119,278)		 195,541 21,541 217,082
Fund balances at 1 January
2022 721,674 21,541 743,215 526,133 - 526,133
Fund balances at 31
December 2022 623,937 - 623,937 721,674 21,541 743,215

The statement of financial activities also complies with the requirements for an income and expenditure account under the Companies Act 2006.

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

AS AT 31 DECEMBER 2022

2022 2021
Notes £ £ £ £
Fixed assets
Investments 12 1 1
Current assets
Debtors 14 23,051 3,999
Cash at bank and in hand 619,101 776,493
642,152 780,492
Creditors: amounts falling due within
one year 15 (18,216) (37,278)
Net current assets 623,936 743,214
Total assets less current liabilities 623,937 743,215
Income funds
Restricted funds 17 - 21,541
Unrestricted funds 623,937 721,674
623,937 743,215

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 2022.

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 10 May 2023

Professor P R G Layard

Trustee

Company registration number 10722435

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022

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 amounts 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.

The financial statements do not incorporate the results, assets and liabilities of the charity’s wholly owned subsidiary, Action for Happiness Trading Limited. Consolidated accounts have not been prepared as these would not be materially different from the single entity financial statements as presented.

The charity has taken advantage of the provisions in the SORP for charities applying FRS 102 Update Bulletin 1 not to prepare a Statement of Cash Flows.

1.2 Going concern

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

1.3 Charitable funds

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

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 2022

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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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

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

Derecognition of financial liabilities

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

1.9 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.

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2022

1 Accounting policies

(Continued)

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.

3 Donations and grants

Unrestricted Unrestricted Restricted Restricted Total Unrestricted Unrestricted Restricted Restricted Total
funds funds funds funds
2022 2022 2022 2021 2021 2021
£ £ £ £ £ £
Donations and gifts 50,542 - 50,542 59,856 - 59,856
Grants receivable 75,000 130,500 205,500 25,000 735,000 760,000
125,542 130,500 256,042 84,856 735,000 819,856
Grants receivable for
core activities
The Segelman Trust 50,000 - 50,000 - - -
Founder's Pledge - 130,500 130,500 - 735,000 735,000
Dreamchasing 25,000 - 25,000 25,000 - 25,000
75,000 130,500 205,500 25,000 735,000 760,000

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

FOR THE YEAR ENDED 31 DECEMBER 2022

4 Charitable activities

2022 2021
£ £
Event income 63,075 94,595
Course income 4,991 1,871
Educational services 1,822 12,177
69,888 108,643

5 Investments

**Unrestricted ** Unrestricted
funds funds
2022 2021
£ £
Income from subsidiary 19,681 629
Interest receivable 1,107 643
20,788 1,272

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

2022 2021
£ £
Other income 887 770

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

FOR THE YEAR ENDED 31 DECEMBER 2022

7 Charitable activities

2022 2021
£ £
Staff costs 208,022 236,966
Costs of providing courses 37,532 41,007
Event costs 16,820 37,321
Educational services 295 352
Communication 44,377 83,739
Community development 47,449 180,846
Other Operations - 8,325
354,495 588,556
Share of support costs (see note 8) 111,116 123,667
Share of governance costs (see note 8) 1,272 1,236
466,883 713,459
Analysis by fund
Unrestricted funds 314,842 -
Restricted funds 152,041 713,459
466,883 713,459
Support costs
Support
Governance		 2022 Support
Governance		 2021
costs costs costs costs
£ £ £ £ £ £
Bank fees 173 - 173 143 - 143
General expenses 5,870 - 5,870 8,414 - 8,414
Online services 85,012 - 85,012 91,811 - 91,811
Printing and stationery 870 - 870 2,560 - 2,560
Travel 67 - 67 272 - 272
Rent 16,162 - 16,162 17,590 - 17,590
Insurance 1,223 - 1,223 1,182 - 1,182
Legal and professional 1,739 - 1,739 1,695 - 1,695
Independent examination - 1,272 1,272 - 1,236 1,236
111,116 1,272 112,388 123,667 1,236 124,903
Analysed between
Charitable activities 111,116 1,272 112,388 123,667 1,236 124,903

8 Support costs

ACTION FOR HAPPINESS (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2022

9 Trustees

None of the trustees (or any persons connected with them) received any remuneration or benefits from the charitable company during the year (2021: £nil).

During the year, the trustees received a total of £nil (2021: £nil) in expenses from the charity.

10 Employees

The average monthly number of employees during the year was:

The average monthly number of employees during the year was:
2022 2021
Number Number
Administration 2 3
In addition to the 2 employees noted above, expenditure also includes payment to 2 subcontractors (2021: 1)
giving a total workforce of 4 full time equivalents (FTEs)..
Employment costs 2022 2021
£ £
Wages and salaries 163,893 190,775
Social security costs 20,687 21,325
Other pension costs 23,442 24,866
208,022 236,966
The number of employees whose annual remuneration was more than £60,000
is as follows:
2022 2021
Number Number
£110,001 to £120,000 1 1

11 Taxation

The charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxationof Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.

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

FOR THE YEAR ENDED 31 DECEMBER 2022

12 Fixed asset investments

Other
investments
Cost or valuation
At 1 January 2022 & 31 December 2022 1
Carrying amount
At 31 December 2022 1
At 31 December 2021 1
2022 2021
Other investments comprise: Notes £ £
Investments in subsidiaries 13 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.

13 Subsidiaries

Details of the charity's subsidiaries at 31 December 2022 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 Trading Limited was £82,924 and expenditure incurred was £63,243 resulting in a profit of £19,681. All of the profit was distributed up to the charity in the period.

14 Debtors

Debtors
2022 2021
Amounts falling due within one year: £ £
Amounts owed by subsidiary undertakings 20,681 1,629
Prepayments and accrued income 2,370 2,370
23,051 3,999

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

FOR THE YEAR ENDED 31 DECEMBER 2022

15 Creditors: amounts falling due within one year

2022 2021
£ £
Other taxation and social security 5,309 6,127
Other creditors 11,707 29,951
Accruals and deferred income 1,200 1,200
18,216 37,278
16 Analysis of net assets between funds
Unrestricted
Restricted
**Total **		 Unrestricted
Restricted		 Total
funds funds funds funds
2022 2022 2022 2021 2021 2021
£ £ £ £ £ £
Fund balances at 31
December 2022 are
represented by:
Investments 1 - 1 1 - 1
Current assets/(liabilities) 623,936 - 623,936 721,673 21,541 743,214
623,937 - 623,937 721,674 21,541 743,215

17 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 2021 resources expended 1 January 2022 resources expended 31
December
2022
£ £ £ £ £ £ £
Founders
Pledge - 735,000 (713,459) 21,541 130,500 (152,041) -

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 2022

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 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:

2022 2021
£ £
Within one year 16,034 7,840