OpenCharities

This text was generated using OCR and may contain errors. Check the original PDF to see the document submitted to the regulator.

2024-03-31-accounts

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 1/33

Registration number: 08385555 Homes England number: 4756 Charity Number: 1197888

TCUK HOMES LIMITED

(A company limited by guarantee)

Annual Report and Financial Statements

for the Year Ended 31 March 2024

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 2/33

TCUK Homes Limited

Contents

Company Information 1
Report of the Board (including Strategic Report) 2 to 10
Independent Auditor's Report 11 to 14
Statement of Comprehensive Income 15
Statement of Financial Position 16
Statement of Changes in Reserves and Equity 17
Statement of Cash Flows 18
Notes to the Financial Statements 19 to 31

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 3/33

TCUK Homes Limited

Company Information

Directors A T M Shiel L Telford S Bell M Smith G Kay Registered office H26 The Avenues Eleventh Avenue North Team Valley Trading Estate Gateshead Tyne and Wear NE11 0NJ Solicitors Sintons LLP The Cube Barrack Road Newcastle NE4 6DB Auditor Azets Audit Services Chartered Accountants & Statutory Auditor Bulman House Regent Centre Gosforth Newcastle upon Tyne NE3 3LS

1

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 4/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024

The Board of TCUK Homes Limited present their report, including the strategic report and the audited financial statements for the year ended 31 March 2024.

Principal activity

The principal activity of the company is the provision of affordable rented accommodation for vulnerable people in housing need.

Members of the Board of Management

The Members of the Board of Management during the year ended 31 March 2024 were as follows:

Stephen Bell CEO, Changing Lives.

Board Treasurer, Executive Director of Finance & Business Support, North Star James Walder* Housing Group

Alex Shiel Chair of Board, Partner, retired Head of IP/IT, Ward Hadaway Mel Smith National Housing Manager, SJOG Hospitaller Services Geraldine Kay Former CEO of Derwentside Homes & former Changing Lives Board Member Lesley Telford Director / Trustee, Derwentside Hospice Care Foundation

*James Walder resigned on 28th November 2023.

Review of the business / business model

TCUK Homes is established for the following charitable purposes:

To provide for the benefit of the community the business of providing and managing social housing and any associated facilities, amenities, or services for persons in necessitous circumstances upon terms appropriate to their means.

TCUK is a wholly owned subsidiary of Changing Lives and a registered provider of social housing, operating under registration number 4756 with the Regulator of Social Housing.

TCUK aims to achieve its charitable purposes by:

As of 31 March 2024, TCUK Homes has sixty-one affordable rented homes in management: fourteen non-social rental housing on behalf of Changing Lives and two hundred and eighty-one supported housing units.

TCUK Homes operates in nine local authority areas in the North-East and Yorkshire: Northumberland, Newcastle, Gateshead, North Tyneside, South Tyneside, Sunderland, Durham, Middlesbrough, and York.

2

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 5/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

TCUK Homes is a registered housing provider and an investment partner with Homes England. Its strategy is to consolidate and expand the portfolio subject to the availability of funding to support investment.

Performance in the year, main influences and potential risks

In 2022/23 the Board had approved the sale of a portfolio of non-social housing units. During 2023/24 the focus was on ensuring that this strategy was delivered with the bulk sale of 31 units being completed on the 31st August 2023. A further 11 units had completed sales in 2023/24. There are no further plans to reduce the number of units within the general needs provision.

In the previous year’s report we noted that grant waivers had been submitted to Homes England and a decision was pending. TCUK Homes has engaged with Homes England in discussing its plan for recycling of the current capital grant balances held by TCUK Homes as a result of the sale. The waivers have therefore been withdrawn and TCUK Homes board will be looking to recycle this funding as part of its supported housing growth strategy.

In addition to the options appraisal on Homelife schemes, a review was also undertaken on supported housing schemes. As part of this review the number of units held within the Young Person’s dispersed accommodation service in Middlesbrough was reduced. This had been a project with higher voids in previous year and so action was taken to reduce the financial risk of a larger portfolio.

TCUK is continuing with its strategy of core business relating to supported housing schemes. Looking ahead into 2024/25 a further 89 units have already received board approval to be added to the TCUK Homes portfolio.

During 2023/24 a further three properties have been converted from affordable housing to supported housing with the consent of Homes England. This will enable TCUK Homes to expand its partnership working with Changing Lives and rehouse homeless people.

During the year a comprehensive review of arrears has been undertaken, with a dedicated role created to provide support in managing this critical area of performance.

TCUK Homes conducted a tenant satisfaction at the end of the financial year, results were positive with the majority of tenants responding that they are ‘very satisfied’ with the overall service provided by TCUK Homes. Also it was pleasing to note that the majority of tenants felt satisfied that their home was safe and they were respected and informed by TCUK.

TCUK Homes continues to provide homes to people who might otherwise struggle to access private rented or social housing tenancies due to a lack of availability or affordability. Because of our key lettings criteria TCUK Homes is often the first port of call for referral agencies working with clients with specific needs and vulnerabilities.

In allocating tenancies, the following groups of people are prioritised:

3

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 6/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

There has been a further strategic review of our Homelife properties conducted which concluded that the homelife properties would be better supported being managed by the local teams across the North East. This strategy is to ensure TCUK Homes can offer more enhanced support service to our general needs tenants and be able to carry out more timely inspections, reducing financial risk and improving standards and experience.

During the year renovation works were completed on some units at the Fells Project in Durham, these units have been brought back into the portfolio and will be used within the Alder Project which has been commissioned by Durham County Council. This will provide emergency beds for those discharged from hospital who would otherwise find themselves homeless.

As with other projects, the model adopted is Changing Lives leading the contract, delivering the support element, and receiving the support income. TCUK Homes leases the properties and receives Housing Benefit income.

Expected Effects of Known Trends & Significant Future Risks

The Board conducts regular reviews of risks and controls within a comprehensive register. Significant risks include the following:

The Board has undertaken stress tests of the business. The Board discussed some scenarios relevant to the size and complexity of the business and assessed the robustness of the controls in place.

Risk of non-compliance with Health & Safety legislation is also a key risk to TCUK Homes Limited. The health and safety of our tenants, staff and partner organisations is extremely important to the organisation. There are complex legal requirements that TCUK Homes must always comply with, and our staff undertake regular checks to ensure full compliance. Datix is a reporting tool, which is used to record and analyse incidents within schemes. Annual gas servicing and boiler repairs in our general needs properties are undertaken by Karbon Solutions with gas servicing visits programmed for completion over an 11-month cycle and any delays caused by residents not allowing access results in prompt action by the Homelife Tenancy Management Team to enforce access. Changing Lives employs a full time Gas Safe Engineer to carry out gas servicing and boiler repairs in supported housing schemes.

4

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 7/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

Financial Review and Position at the year end

In the 2023/24 fiscal year, TCUK Homes Limited generated a surplus of £416,463. The balance sheet reserves position was £433,427 with total fixed assets of £8,195,666 offset with corresponding Homes England housing grants of £4,766,510.

Financial and Non-Financial measures used by the Board

The Board monitors a performance dashboard for both general needs and supported housing. It provides an overview of the number of properties in management; arrears and voids performance; Health and Safety incidents (including a summary of any outstanding CP12s) and an update of business development and future funding opportunities.

Capital Structure and Treasury Policy

TCUK Homes Board would manage any long-term investment plans through Changing Lives with appropriate scrutiny under the company’s standard financial policies.

Value for Money

TCUK Homes is committed to delivering value for money to its residents and service users through the provision of good quality affordable homes and services.

An annual report is produced and issued to all residents. The report provides an overview of performance, finances, value for money and compliance against the regulatory standards.

Value for money means making the best use of resources and includes the following:

The focus of TCUK Homes value for money activities in 2023/24 was to ensure that performance was as expected post options appraisals which were carried out in 2022/23.

There has been higher than expected void losses for supported housing particularly in our dispersed accommodation projects due to delays in receiving nominations and letting of properties. This has triggered a strategic review by Changing Lives of its growth strategy.

Following the publication of the Regulator of Social Housing’s Decision Instrument Number 16 ‘Decision to revise the Value for Money Standard and issue an associated Code of Practice’, metrics are produced for the consideration of TCUK Homes Board.

The metrics applied to TCUK Homes for the year are set out in the table below, which provides a comparison to the previous two fiscal years:

5

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 8/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

6

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 9/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

Please see additional commentary below in relation to the above metrics:

7

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 10/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

Corporate Governance

TCUK Homes Board of Management consider that the company is compliant with the Regulator of Social Housing Governance and Viability standards.

The Board has previously approved an Asset Management Strategy which includes an Asset & Liabilities Register and 30 Year Planned Maintenance Plan. An Asset & Liabilities Register is regularly updated and refreshed throughout the year to facilitate compliance with the regulatory requirements.

A Governance Handbook identifies the Changing Lives Group structure; defines TCUK Homes’ terms of reference, powers and limits of authority, membership, chair, attendees, term of office, quorum, meetings & agenda, and attendance at meetings. A copy of the Regulator of Social Housing’s Governance and Financial Viability Standard Code of Practice are included as an addendum to the Governance Handbook.

A new intergroup agreement was approved by the Board in November 2022 which clarifies its role and responsibilities. Annual Business Plans for TCUK Homes will be produced and presented to the Board for approval.

TCUK Homes is committed to working with and listening to its residents and at each of its meetings, the Board reviews any complaints or compliments received to consider any lessons learned.

Properties in management are dispersed over an exceptionally large geographical area and due to the sparsity of properties throughout these areas; there is little opportunity for social events or get-togethers. Instead, there are opportunities for residents to focus upon the work of the project.

Statement of Responsibilities of the Board

The Regulator of Social Housing requires the Board of Management to prepare financial statements for each financial year, which give a true and fair view of the state of affairs of the Association and the surplus or deficit of the Association for that period. In preparing those financial statements, the Board of Management are required to:

The Board of Management are responsible for maintaining proper accounting records which disclose with reasonable accuracy at any time the financial position of the Association and to enable them to ensure that the financial statements comply with Schedule 1 to the Housing and Regeneration Act 2008 and the Accounting Directions for Private Registered Providers of Social Housing 2022.

The Board of Management acknowledges its ultimate responsibility for ensuring that the Association has in place a system of controls that is appropriate to the business environment in which it operates. These controls are designed to give reasonable assurance with respect to:

8

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 11/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

It is the responsibility of the Board of Management to establish and maintain systems of internal financial control. Such systems can only provide reasonable and not absolute assurance against material financial misstatement or loss. Key elements include:

The Board of Management has reviewed the effectiveness of the system of internal financial control in existence in the company for the year ended 31 March 2024. No weaknesses in internal financial control resulted in material losses, contingencies, or uncertainties, which require disclosure in the financial statements or the auditors’ report on the financial statements.

Registration

TCUK Homes Limited is registered with the Regulator of Social Housing as a Registered Social Housing Provider.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

9

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 12/33

TCUK Homes Limited

Report of the Board (including Strategic Report) for the Year Ended 31 March 2024 (continued)

Reappointment of auditor

In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of Azets Audit Services as auditors of the company is to be proposed at the forthcoming Annual General Meeting.

Statement of compliance

The Board confirms that this Report of the Board (including Strategic Report) has been prepared in accordance with the principles set out in Para 4.7 of the Housing SORP 2018 Update for Registered Social Housing Providers 2022.

Approved by the Board on ....................26/09/2024 and signed on its behalf by:

Stephen Bell 26 Sep 2024 16:49:30 BST (UTC +1)

......................................... S Bell Director

10

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 13/33

TCUK Homes Limited

Independent Auditor's Report to the Members of TCUK Homes Limited

Qualified Opinion

We have audited the financial statements of TCUK Homes Limited (the 'company') for the year ended 31 March 2024, which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Reserves and Equity, Statement of Cash Flows, 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), the Housing and Regeneration Act 2008, the Statement of Recommended Practice (SORP) accounting by Registered Social Housing Providers 2018 and the Accounting Direction for Private Registered Providers of Social Housing 2022.

In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

Basis for qualified opinion on financial statements

As described in 'accounting policies: Leases' housing properties recognised in the financial statements as being held under leases have been recognised as an asset and the corresponding liability to the lessor has been recognised as a finance lease obligation. A significant proportion of the cost of the housing properties relates to Land which has an unlimited useful life. Therefore the lease term is not for the major part of the economic life which would indicate that all the risks and rewards incidental to the ownership have not transferred to TCUK. In our opinion, the lease should therefore be classified as an operating lease and rentals charged to the statement of comprehensive income on a straight line basis over the lease term.

As a result the company's records indicate that had the members recognised the lease as an operating lease, then: fixed assets would reduce by £8,043,890 consequently the depreciation charge would reduce by £229,287; the finance lease creditor would reduce by £3,871,390; the finance interest charge would reduce by £171,323; and, the company would have had an operating lease charge increase of £201,363.

Accordingly, the impact on the reported result would be an improvement of £199,247 to the reported surplus on the Statement of Comprehensive Income and a worsening of the reported balance sheet position by £4,172,500.

11

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 14/33

TCUK Homes Limited

Independent Auditor's Report to the Members of TCUK Homes Limited (continued)

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were authorised for issue.

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

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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 course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matter prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the report of the board .

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

12

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 15/33

TCUK Homes Limited

Independent Auditor's Report to the Members of TCUK Homes Limited (continued)

Responsibilities of directors

As explained more fully in the (set out on page 7 and 8), the directors 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 directors 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 directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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:

• Enquiries with management about any known or suspected instances of non-compliance with laws and regulations and fraud;

• Reviewing board minutes;

• Challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to stock provisions; and

• Auditing the risk of management override

Because of the field in which the client operates, we identified the following areas as those most likely to have a material impact on the financial statements: Health and Safety; Building and fire safety regulations including; the Housing Act 2004 and the Regulatory Reform (fire safety) order 2005 and compliance with the UK Companies Act.

Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

13

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 16/33

TCUK Homes Limited

Independent Auditor's Report to the Members of TCUK Homes Limited (continued)

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, and Housing and Regeneration Act 2008. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Simon Brown 27 Sep 2024 07:27:56 BST (UTC +1)

...................................... Simon Brown BA ACA DChA (Senior Statutory Auditor) For and on behalf of Azets Audit Services Chartered Accountants Statutory Auditor Bulman House Regent Centre Gosforth Newcastle upon Tyne NE3 3LS

27/09/2024 Date:.............................

Azets Audit Services is a trading name of Azets Audit Services Limited

14

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 17/33

TCUK Homes Limited

Statement of Comprehensive Income for the Year Ended 31 March 2024

Note
Turnover
3
Operating expenses
4
Other operating income
5
Operating surplus
6
Interest payable and similar expenses
7
Surplus before tax
Taxation
Surplus for the financial year		 2024
£
4,982,454
(4,686,329)
325,265
621,390
(218,241)
403,149
13,314
416,463		 2023
£
4,794,436
(4,339,360)
25,396
480,472
(436,481)
43,991
-
43,991

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

Approved and authorised by the Board on ....................26/09/2024 and signed on its behalf by:

Stephen Bell 26 Sep 2024 16:49:30 BST (UTC +1) ......................................... S Bell Director

The notes on pages 19 to 31 form an integral part of these financial statements.

15

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 18/33

TCUK Homes Limited

(Registration number: 08385555) Statement of Financial Position as at 31 March 2024

Note
Fixed assets
Tangible assets
10
Current assets
Debtors
11
Cash at bank and in hand
Creditors: Amounts falling due within one year
13
Net current assets
Total assets less current liabilities
Creditors: Amounts falling due after more than one year
13
Net assets
Capital and reserves
Profit and loss account
Total equity		 2024
£
8,195,666
394,786
1,431,150
1,825,936
(980,565)
845,371
9,041,037
(8,607,610)
433,427
433,427
433,427		 2023
£
8,871,407
835,327
342,065
1,177,392
(775,425)
401,967
9,273,374
(9,256,410)
16,964
16,964
16,964

Approved and authorised by the Board on ....................26/09/2024 and signed on its behalf by:

Stephen Bell 26 Sep 2024 16:49:30 BST (UTC +1)

......................................... S Bell Director

The notes on pages 19 to 31 form an integral part of these financial statements.

16

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 19/33

TCUK Homes Limited

Statement of Changes in Reserves and Equity for the Year Ended 31 March 2024

At 1 April 2022
Total comprehensive income
At 31 March 2023
At 1 April 2023
Total comprehensive income
At 31 March 2024		 Profit and
loss account
£
(27,027)
43,991
16,964
Profit and
loss account
£
16,964
416,463
433,427		 Total
£
(27,027)
43,991
16,964
Total
£
16,964
416,463
433,427

The notes on pages 19 to 31 form an integral part of these financial statements.

17

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 20/33

TCUK Homes Limited

Statement of Cash Flows for the Year Ended 31 March 2024

Note
Cash flows from operating activities
Surplus for the year
Adjustments to cash flows from non-cash items
Social housing grant recognised in income
Depreciation and amortisation
6
Finance costs
7
Income tax expense
Working capital adjustments
Decrease/(increase) in debtors
11
Increase/(decrease) in creditors
13
Cash generated from operations
Income taxes paid
Net cash flow from operating activities
Cash flows from investing activities
Acquisitions of tangible assets
Proceeds from sale of tangible assets
Net cash flows from investing activities
Cash flows from financing activities
Interest paid
7
Payments to finance lease creditors
Proceeds/(repayments) from advance of government
grants
Net cash flows from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at 1 April
Cash and cash equivalents at 31 March		 2024
£
416,463
(94,112)
294,940
218,241
(13,314)
822,218
440,541
227,832
1,490,591
(9,378)
1,481,213
(10,000)
390,803
380,803
(218,241)
(384,690)
(170,000)
(772,931)
1,089,085
342,065
1,431,150		 2023
£
43,991
(113,179)
355,298
436,481
-
722,591
(258,304)
(575,694)
(111,407)
-
(111,407)
(7,960)
108,768
100,808
(436,481)
(142,515)
(64,000)
(642,996)
(653,595)
995,660
342,065

The notes on pages 19 to 31 form an integral part of these financial statements.

18

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 21/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024

1 General information

The company is a company limited by guarantee, incorporated in England and Wales and registered with Homes England, and consequently does not have share capital. Each of the members is liable to contribute an amount not exceeding £1 towards the assets of the company in the event of liquidation.

The address of its registered office is H26 The Avenues Eleventh Avenue North, Team Valley Trading Estate, Gateshead, Tyne and Wear, NE11 0NJ.

2 Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland,' the Accounting Directions for Private Registered Providers of Social Housing 2022 and the Statement of Recommended Practice Accounting by Registered Social Landlords, Update 2018 ('SORP2018'). The financial statements are also prepared under the requirements of the Housing and Regeneration Act 2008 and the Companies Act 2006.

In accordance with FRS102 PBE3.3A the directors confirm that this Registered Social Housing Provider is a Public Benefit Entity.

On the 11 February 2022, the entity obtained charitable status, with charity number 1197888. The accounts continue to be prepared under the Housing SORP, which takes priority over the Charity SORP.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

These financial statements are prepared in sterling which is the functional currency of the entity.

19

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 22/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

2 Accounting policies (continued)

Going concern

The financial statements have been prepared on a going concern basis.

The company meets its day to day working capital requirements through cash generated from operations. At the year end the company had net current assets of £845,372 including cash of £1,431,150 and made a surplus before tax of £403,149. The company had no external borrowings and limited financial commitments.

The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance. The entity also continues to receive support from Changing Lives as its parent company.

Based on the factors set out above the directors believe that there is no material uncertainty in relation to going concern and that the company has adequate financial resources to continue in operational existence for at least twelve months from the date of signing the financial statements and therefore the directors believe it remains appropriate to prepare the financial statements on a going concern basis.

20

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 23/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

2 Accounting policies (continued)

Judgements

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The judgements (apart from those involving estimations) that management has made in the process of applying the entity's accounting policies and that have the most significant effect on the amounts recognised in the financial statements are as follows:

Assessing indicators of impairment - In assessing whether there have been indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability.

Assessing nature of lease - Determine whether leases entered into by TCUK Homes Limited either as a lessor or a lessee and are operating leases or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis. Housing properties held under leases have been recognised as an asset however they include a significant proportion relating to land which has an unlimited useful life. As the lease term is not for the major part of the economic life of the asset, FRS102 would indicate that the lease should be classified as an operating lease however the directors consider it more appropriate to classify housing property leases as finance leases and recognise an asset and corresponding finance lease obligation.

Key sources of estimation uncertainty

Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

Useful economic lives of tangible assets - The annual depreciation charge is sensitive to changes in the estimated useful lives of the assets. The useful economic lives are re-assessed annually. They are amended when necessary to reflect current estimates, future investments and economic utilisation.

Impairment of debtors - The company makes an estimate of the recoverable value of the trade and other debtors. When assessing impairment of trade and other debtor, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience.

Revenue recognition

Turnover represents rental income and service charges receivable net of rent and service charge losses from voids as well as social housing grants released. Turnover is recognised as the period of rent is due.

Tax

The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

21

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 24/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

2 Accounting policies (continued)

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

On the 11 February 2022 the entity obtained charitable status. From this point, the entity is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010 and therefore meets the definition of a charitable company for UK Corporation Tax purposes. Accordingly, the charity is potentially exempt from taxation in respect of income or capital gains received within categories covered by Chapter 3 Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes.

Tangible assets

Tangible assets (including social housing properties) are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Expenditure on improvements will only be capitalised when it results in incremental future benefits such as increasing rental income, reducing maintenance costs or resulting in a significant extension of the useful economic life of the property.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class Depreciation method and rate
Leasehold land 60 years
Structure 50 years
Roofing 30 years
Kitchen, bathroom and other 15 years
Furniture, Fittings and Equipment 3-4 years

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Rent arrears and advances

In accordance with the Accounting Direction for Private Registered Providers of Social Housing, rent arrears and advances are not netted-off and are presented as part of debtors and creditors respectively. Where a payment plan has been entered into for rent arrears, which is considered to be material, then the rent arrears debtor is adjusted to its net present value.

22

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 25/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

2 Accounting policies (continued)

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the statement of comprehensive income over the period of the relevant borrowing. Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership of the leased asset to TCUK Homes Limited. All other leases are classified as operating leases.

Assets held under finance leases are recognised initially at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments) at the inception of the lease. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation using effective interest method so as to achieve a constant rate of interest on the remaining liability. Finance charges are deducted in the statement of comprehensive income. Assets held under finance leases are included in other tangible fixed assets and depreciated and assessed for impairment losses in the same way as owned assets.

Lease payments are apportioned between finance costs in the Statement of Comprehensive Income and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

23

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 26/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

2 Accounting policies (continued)

Social housing grant

Social Housing Grant received as a capital contribution, in line with SORP2018 and the ‘accruals method’, is held separately as a creditor due more than one year, unless part of the Social Housing Grant relates to a disposal of property and becomes recycled or repayable, in which case it is apportioned to creditors due less than one year accordingly. The ‘accruals method’ is applied as the RSHP holds all social housing properties at their historic cost.

The Social Housing Grant is then amortised in line with the depreciation of the ‘structure’ component of the housing properties and released over 50 years (2%). The amortisation released in respect of the Social Housing Grant is recognised in the Statement of Comprehensive Income as ‘income’.

Social Housing Grant received towards revenue expenditure is matched against that expenditure by being included in turnover in the income and expenditure account. The related expenditure is included under operating costs. Social Housing Grant is recognised in the same period as the related expenditure provided the conditions for its receipt have been satisfied and there is reasonable assurance that the grant will be received.

Social Housing Grant received and not matched by development expenditure or relevant expenditure in the income and expenditure account is included in current liabilities. The amount of Social Housing Grant in advance is calculated by reference to the aggregate of all schemes in the Social Housing Grant funded development programme.

Recycled capital grant

Capital grants can be recycled under certain conditions, if a property is sold, or if another relevant event takes place. In these cases, the grant can be used for projects approved by the Homes England. Grant to be recycled is credited to the Recycled Capital Grant Fund/Disposal Proceeds Fund within creditors. When any grant is to be recycled or repaid is less than the grant relating to the disposal, the difference is treated as abated grant. Abated capital grants are treated as a component of the surplus or deficit on disposal.

In certain circumstances, such as the sale of housing properties, capital grants may be repayable and, in that event, is subordinated to the repayment of other loans by agreement with the Homes England. It is accounted for as soon as the liability arises within creditors: amounts falling due within one year.

Group status

The Registered Social Housing Provider is the subsidiary to Changing Lives (The Cyrenians Limited), a charity registered in England and Wales (company no. 08095264, charity no 500640).

3 Turnover, operating costs and operating surplus for the year

Social housing lettings
Other		 Turnover
£
4,982,454
325,265
5,307,719		 Operating
costs
£
(4,686,329)
-
(4,686,329)		 Operating
surplus
2024
£
296,125
325,265
621,390

24

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 27/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

3 Turnover, operating costs and operating surplus for the year (continued)

Social housing lettings
Other		 Turnover
£
4,794,436
25,396
4,819,832		 Operating
costs
£
(4,339,360)
-
(4,339,360)		 Operating
surplus
2023
£
455,076
25,396
480,472

4 Analysis of Turnover, Operating Costs and Operating Surplus for the year

Turnover
Rent receivable net of identifiable service
charges
Amortised government grants
Other grants
Total turnover
Voids
Operating Expenditure
Management charges payable
Routine maintenance
Bad debts
Depreciation of housing properties
Other staff costs
Motor expenses
Travelling and subsistence
Rent and rates
Light, heat and power
Insurance
Telephone and fax
Office expenses
Other costs
Legal and professional fees
Computer software and maintenance costs
Cleaning
Auditor's remuneration
Food and welfare
Total operating expenditure		 General
needs
housing
£
4,888,342
94,112
-
4,982,454
(599,302)
General
needs
housing
£
151,977
543,850
560,995
294,940
1,251,705
20,909
652
1,332,807
371,556
22,331
12,675
12,839
3,472
33,813
4,706
20,079
18,000
29,023
4,686,329		 2024
£
4,888,342
94,112
-
4,982,454
(599,302)
2024
£
151,977
543,850
560,995
294,940
1,251,705
20,909
652
1,332,807
371,556
22,331
12,675
12,839
3,472
33,813
4,706
20,079
18,000
29,023
4,686,329		 2023
£
4,679,757
113,179
1,500
4,794,436
(708,553)
2023
£
152,082
491,104
239,646
355,298
1,333,036
15,829
1,153
1,235,965
325,244
33,914
15,576
8,133
9,869
28,427
4,608
24,447
13,560
51,469
4,339,360

25

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 28/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

4 Analysis of Turnover, Operating Costs and Operating Surplus for the year (continued)

Operating surplus from social housing lettings General
needs
housing
£
296,125		 2024
£
296,125		 2023
£
455,076

5 Other operating income

The analysis of the company's other operating income for the year is as follows:

Other operating income
Management charges receivable		 2024
£
324,922
343
325,265		 2023
£
25,396
-
25,396

Other operating income includes the sales of a number of properties as well as other miscellaneous income.

6 Operating surplus

Arrived at after charging/(crediting)

Amortised government grants
Depreciation expense
7
Interest payable and similar expenses
Interest on obligations under finance leases and hire purchase
contracts
Interest expense on other finance liabilities		 2024
£
(94,112)
294,940
2024
£
171,323
46,918
218,241		 2023
£
(113,179)
355,298
2023
£
187,005
249,476
436,481

26

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 29/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

8 Staff costs

Total staff costs incurred in the year amounted to £1,251,705 (2023: £1,334,552).

Whilst the above charge relates to the employment costs of individuals engaged in activities in relation to the TCUK Homes Limited, all individuals are employed directly by Changing Lives, the parent charity, and recharged to TCUK Homes Limited. TCUK Homes Limited does not directly employ any staff.

Particulars of employees:

No employee earned more than £60,000. Key management personnel neither received nor waived any remuneration during the year. The Directors are defined as the Board of Management and therefore could be classed as Key Management Personnel. None of the Board of Management received any emoluments during 2024 (2023: £nil). The RSHP has no other paid Executive Officers.

The total expenses reimbursed to the Board of Management not chargeable for UK income tax during 2024 was £Nil (2023: £Nil).

9 Auditor's remuneration

Audit of the financial statements 2024
£
18,000		 2023
£
13,560

27

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 30/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

10 Tangible assets

Cost or valuation
At 1 April 2023
Additions
Disposals
At 31 March 2024
Depreciation
At 1 April 2023
Charge for the year
Eliminated on disposal
At 31 March 2024
Carrying amount
At 31 March 2024
At 31 March 2023		 Housing
properties for
let
£
10,404,804
10,000
(542,409)
9,872,395
1,629,937
232,749
(151,606)
1,711,080
8,161,315
8,774,867		 Furniture,
fittings and
equipment
£
230,050
-
-		 Total
£
10,634,854
10,000
(542,409)
230,050 10,102,445
133,508
62,191
-		 1,763,445
294,940
(151,606)
195,699 1,906,779
34,351 8,195,666
96,540 8,871,407

Included within the net book value of Housing Properties for let above is £8,161,315 (2023 - £8,774,867) in respect of long leasehold land and buildings.

11 Debtors

Trade debtors (gross rent arrears)
Bad debt provision
Net rent arrears
Other debtors
Prepayments and accrued income		 2024
£
930,720
(541,178)
389,542
-
5,244
394,786		 2023
£
830,521
(90,928)
739,593
12,283
83,451
835,327

28

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 31/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

12 Cash and cash equivalents

Cash at bank
13 Creditors
Note
Due within one year
Loans and borrowings
14
Trade creditors
Amounts owed to group undertakings
17
Other creditors
Accrued expenses
Corporation tax liability
Deferred income - Recycled social housing grant
Due after one year
Loans and borrowings
14
Deferred income - Social housing grant
15		 2024
£
1,431,150
2024
£
30,291
229,316
324,323
5,681
156,954
-
234,000
980,565
3,841,100
4,766,510
8,607,610		 2023
£
342,065
2023
£
30,291
79,282
391,204
6,259
181,697
22,692
64,000
775,425
4,225,788
5,030,622
9,256,410

Finance leases (included in loans and borrowings) are secured upon the assets to which they relate.

29

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 32/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

14 Loans and borrowings
Current loans and borrowings
Finance lease liabilities
Non-current loans and borrowings
Finance lease liabilities
15 Social housing grant
Gross grant creditor
At 1 April 2023
Disposals
At 31 March 2024
Amortisation
At 1 April 2023
Grant release
Disposals
At 31 March 2024
Carrying amount
At 31 March 2024
At 31 March 2023		 2024
£
30,291
2024
£
3,841,100
Social
housing
grant
£
5,788,769
(170,000)
5,618,769
758,147
123,578
(29,466)
852,259
4,766,510
5,030,622		 2023
£
30,291
2023
£
4,225,788
Total
£
5,788,769
(170,000)
5,618,769
758,147
123,578
(29,466)
852,259
4,766,510
5,030,622

The RSHP considers that its financial instruments include the Social Housing Grant which is included as a liability within the financial statements. Where the RSHP has no intention to dispose of its housing properties, the Social Housing Grant will not become repayable.

The disposal of the grant in the year of £170,000 (and £29,466 reversal of amortisation) is in relation to the disposal of three properties in which Social Housing monies had been receipted. This £170,000 grant is now shown within creditors due within one year as Social Housing Recycled grant.

30

VirtualSignature Transaction Ref. 4XKS-4PS9-4XYJ 27 Sep 2024 07:27:57 BST (UTC +1) D 2/3 P 33/33

TCUK Homes Limited

Notes to the Financial Statements for the Year Ended 31 March 2024 (continued)

16 Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

Not later than one year
Later than one year and not later than five years
Later than five years		 2024
£
322,951
445,391
3,497
771,839		 2023
£
315,924
198,284
-
514,208

17 Related party transactions

Summary of transactions with entities with joint control or significant interest

The company is related to The Cyrenians Limited (operating as Changing Lives) as a result of the entity being the holding company. During the year the following transactions were undertaken:

TCUK Homes Limited incurred management fees, recharge of staff costs and support costs from Changing Lives amounting to £218,241 (2023: £436,481). An amount was received from Changing Lives of £14,475 (2023: £14,475) for the management of the Homelife properties.

Included in Creditors: amounts owed to group companies at the year end is an amount owed to Changing Lives of £324,323 (2023: £391,204).

18 Accommodation in management

General needs
Supported accommodation		 2024
No.
75
281
356		 2023
No.
78
331
409

19 Parent and ultimate parent undertaking

The company's immediate parent and controlling party is The Cyrenians Limited, a charity and company limited by guarantee, trading as Changing Lives, incorporated in England and Wales.

These financial statements are available upon request from H26 The Avenues Eleventh Avenue North, Team Valley Trading Estate, Gateshead, NE11 0NJ.

31