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2025-03-31-accounts

Certificate Of Completion

Envelope Id: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195 Subject: Complete with Docusign: NE-HA Final 31-3-2025.pdf, NEHA - 2025 LOR-1.pdf, Audit findings report... Source Envelope: Document Pages: 79 Signatures: 5 Certificate Pages: 5 Initials: 0 AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada)

Status: Completed

Envelope Originator: Detlev Anderson detlev-anderson@kinnair.co.uk IP Address: 185.16.152.169

Record Tracking

Status: Original Holder: Detlev Anderson 9/12/2025 10:14:13 AM detlev-anderson@kinnair.co.uk

Location: DocuSign

Signer Events

Signature

Caroline Mortlock caroline.mortlock@thermofisher.com NEHA Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 46.226.217.64 Electronic Record and Signature Disclosure: Accepted: 9/30/2022 2:02:38 AM ID: 0a4ca12f-c7ec-42a7-b8fb-58a47459c933 Victoria Gray vgray_1@yahoo.co.uk Security Level: Email, Account Authentication (None) Signature Adoption: Drawn on Device Using IP Address: 82.132.184.255 Signed using mobile

Timestamp Sent: 9/12/2025 10:36:35 AM Viewed: 9/14/2025 2:29:32 AM Signed: 9/14/2025 2:29:44 AM

Sent: 9/14/2025 2:29:45 AM Viewed: 9/14/2025 7:12:27 AM Signed: 9/14/2025 7:13:14 AM

Electronic Record and Signature Disclosure:

Accepted: 9/14/2025 7:12:27 AM ID: a15b9429-d570-43ea-8748-3535c08be3de

Detlev Anderson detlev-anderson@kinnair.co.uk Director Kinnair Associates Limited Signature Adoption: Pre-selected Style Security Level: Email, Account Authentication (None) Using IP Address: 185.16.152.169

Sent: 9/14/2025 7:13:16 AM Viewed: 9/14/2025 10:44:48 AM Signed: 9/14/2025 10:45:38 AM

Electronic Record and Signature Disclosure:

Not Offered via Docusign

In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Carbon Copy Events Status Timestamp
Peter Nielsen Sent: 9/14/2025 10:45:40 AM
pnielsen@ne-ha.co.uk
MR
Security Level: Email, Account Authentication
(None)
Electronic Record and Signature Disclosure:
Accepted: 8/10/2022 5:45:46 AM
ID: f19acb9d-d0ed-4814-b996-399978be6249
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 9/12/2025 10:36:35 AM
Certified Delivered Security Checked 9/14/2025 10:44:48 AM
Signing Complete Security Checked 9/14/2025 10:45:38 AM
Completed Security Checked 9/14/2025 10:45:40 AM
Payment Events Status Timestamps
Electronic Record and Signature Disclosure

Electronic Record and Signature Disclosure created on: 2/28/2022 10:29:55 AM Parties agreed to: Caroline Mortlock, Victoria Gray, Peter Nielsen

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

Registered number: 00702712 Charity number: 201653

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

GOVERNORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2025

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

CONTENTS
Page
Reference and administrative details of the Charity, its Governors and advisers 1 - 2
Governors' report 3 - 9
Independent auditors' report on the financial statements 10 - 13
Statement of financial activities 14
Income and expenditure account 15
Balance sheet 16 - 17
Statement of cash flows 18
Notes to the financial statements 19 - 43

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

REFERENCE AND ADMINISTRATIVE DETAILS OF THE CHARITY, ITS GOVERNORS AND ADVISERS FOR THE YEAR ENDED 31 MARCH 2025

Governors

Miss C Mortlock, Chair Mr D M Gibson (resigned 27 September 2024) Mrs J Smith Miss V Gray Ms L Hitman Mr D Smith Mr M Armstrong (resigned 25 May 2024) Mr M Armstrong (appointed 28 June 2024, resigned 3 December 2024) Ms N Dewey (appointed 28 March 2025) Mr G Reed

Company registered number

00702712

Charity registered number

201653

Registered office

Jesmond House Clayton Road Jesmond Newcastle upon Tyne NE2 1UJ

Company secretary

Mr P Nielsen

Independent auditors

Kinnair Associates Limited Chartered Accountants Aston House Redburn Road Newcastle upon Tyne NE5 1NB

Bankers

National Westminster Bank Northumberland Street Newcastle upon Tyne NE2 1QP

Page 1

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

REFERENCE AND ADMINISTRATIVE DETAILS OF THE CHARITY, ITS GOVERNORS AND ADVISERS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Solicitors

DWF LLP Great North House Sandyford Road Newcastle upon Tyne NE1 8ND

Investment Managers

Cazenove 1 London Wall Place London EC2Y 5AU

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT FOR THE YEAR ENDED 31 MARCH 2025

The Governors present their annual report together with the audited financial statements of the Charity for the 1 April 2024 to 31 March 2025. The Annual report serves the purposes of both a Governors' report and a directors' report under company law. The Governors confirm that the Annual report and financial statements of the charitable company comply with the current statutory requirements, the requirements of the charitable company's governing document and the provisions of the Statement of Recommended Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) (effective 1 January 2019).

The Charity is also a registered social housing provider. Where applicable additional information is provided in accordance with the Housing SORP 2018: Statement of Recommended Practice (SORP) for Registered Social Housing Providers, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2022. So far as the additional disclosures are concerned the financial statements have been prepared in accordance with the Accounting Direction 2022.

Since the Charity qualifies as small under section 382 of the Companies Act 2006, the Strategic report required of medium and large companies under the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 has been omitted.

The Financial Statements do not present a Statement of Comprehensive Income or a Statement of Changes in Reserves as the Governors believe that the information that would be shown in these statements is already adequately disclosed in the Statement of Financial Activities and the Statement of Funds note to the Financial Statements.

Objectives and activities

Policies and objectives

The object of the company is the prevention or relief of poverty in the North East of England through the provision of affordable accommodation and other essential facilities to individuals in need.

The company is a registered social landlord in the management and administration of Clapham House, John Dobson Street, Newcastle upon Tyne, NE1 8YW and Jesmond House, Clayton Road, Newcastle upon Tyne, NE2 1UJ.

Main activities undertaken to further the Charity's purposes for the public benefit

The Governors have referred to the guidance contained in the Charity Commission’s general guidance on public benefit when reviewing their objectives and activities and in planning future activities. The Governors are satisfied that the principles of public benefit have been and will continue to be addressed in past and future activities of the company.

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Achievements and performance

Main achievements of the Charity

The provision of affordable social housing took place throughout the year in both houses in accordance with the Charity's objectives. This included assisting North East local authorities in placing individuals with housing needs.

Value for money

In accordance with the Value for Money Standard introduced by the Regulator of Social Housing in 2018 we set out below the charitable company's performance against our value for money targets by reference to a series of seven metrics set by the Regulator which seek to measure economy, efficiency and effectiveness:

1 - Reinvestment %

Target Actual Target Actual 2026 2025 2025 2024 0% 0% 0% 0%

Commentary - the reinvestment percentage is calculated by reference to works to the existing properties, divided by the net book value of housing properties at deemed cost. No new properties were developed or acquired and there is no capitalised interest.

2 - New supply %

0% 0% 0% 0%

Commentary - The Governors have no plans to increase the number of social or non-social housing units.

3 - Gearing %

-10.1% -10.5% -9.7% -8.5%

Commentary - The charitable company has no debt and therefore has negative gearing. This is derived from its liquid resources divided by the net book value of housing properties at deemed cost. The Governors have no intention to borrow.

4 - EBITDA MRI Interest cover % 0% 0% 0% 0% Commentary - The charitable company has no borrowing and the Governors have no intention to borrow.

5 - Headline social housing cost £6,393 £6,521 £6,742 £6,206 Commentary - the headline social housing cost has increased and is forecast to reduce slightly. Now that revenue has increased following the reversal of the voids experienced during the Covid pandemic, the Governors are content to budget for higher expenditure, and have decided to put all staff onto a living wage, which has resulted in a significant increase on payroll costs.

6 - Operating margin %

6.1% 25.8% 19.4% 25.5%

Commentary - Operating margin is forecast to decrease due to the latest cycle of refurbishment works in both properties.

7 - Return on capital employed %

7 - Return on capital employed % 1.3% 5.9% 4.3% 5.6% Commentary - expenditure is forecast to increase resulting in the decrease in operating margin with the consequential effect on return on capital employed.

The Governors consider that the facilities offered by the charitable company to be unique in the North East and there are no meaningful comparisons by way of benchmarking available.

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Achievements and performance (continued)

Review of activities

The Charity operates from two properties with the purpose of providing safe, modern, affordable accommodation to those in need.

Jesmond House is a purpose-built facility that provides modern furnished single occupancy bedrooms with breakfast, laundry services and evening meals. Predominantly used for individuals who have previously been homeless, it is located in the leafy suburbs 2 miles from the city centre, with spacious grounds, with a large communal dining area and living room.

Clapham House is a purpose-built facility that provides single and multiple occupancy self catering flats in the heart of the city It is used predominantly for individuals, single-parent families or couples as social housing. The facilities include its own modern kitchen, furnished living room and bathroom.

Jesmond House provided a surplus in the year of £154,422 (2024 - surplus £118,072) before allocation of central overheads.

Clapham House provided a surplus in the year of £61,614 (2024 - surplus £32,132) before allocation of central overheads.

Net central overhead costs after miscellaneous income amounted to £131,819 (2024 - £102,319).

There was therefore an overall operating deficit in the year amounting to £84,217 (2024 deficit - £47,885).

The above results reflect the considerable expenditure in the ongoing refurbishment programme to keep the properties and accommodation to the highest possible standards, and the decision by the Governors to pay all staff at least a living wage.

The financial position of the Charity at 31 March 2025 shows considerable liquid resources available to the Governors to allow them to continue to invest in the provision of affordable social housing.

Investment policy and performance

The Governors continue to place surplus funds in an investment portfolio managed by Cazenove Capital to improve on the returns generated for the benefit of the charitable purpose. The portfolio shows an unrealised valuation surplus as at 31 March 2025 of £19,624 (2024 - surplus of £87,213) which reflects the performance of stockmarkets over the year. The Governors are pleased to note that the portfolio shows a continuing surplus on valuations since then.

Financial review

Going concern

After making appropriate enquiries, and considering the funds invested and liquid funds in hand, the Governors have a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements. Further details regarding the adoption of the going concern basis can be found in the accounting policies.

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Reserves policy

The Governors consider the needs of its residents as requiring a long-term commitment from the Charity. The reserve policy is to hold funds to allow the Charity to continue for a period of at least 12 months even if its income decreases. At 31 March 2025, the Charity had total funds of £7,057,139, of which £2,199,429 was unrestricted and £4,857,710 is restricted (relating to the freehold properties held for the charitable purpose). At the year end, the Charity had a defined benefit pension deficit liability of £100,000. The free reserves of £2,094,558 which currently equates to around 15 months of planned expenditure) will continue to accumulate due to expected surpluses in future years for the benefit of the charitable purpose.

Financial risk management objectives and policies

All activities are subjected to budgetary control and monitored regularly by the Governors. Anticipated variances are authorised in advance of expenditure being committed.

Structure, governance and management

Constitution

North East Housing Association Limited is registered as a charitable company limited by guarantee and was set up by a Memorandum of Association.

The principal object of the charitable company is to provide the relief of need, hardship and distress by the provision of good, clean, safe and affordable accommodation and other facilities for young people of either sex.

Methods of appointment or election of Governors

The management of the Charity is the responsibility of the Governors who are elected and co-opted under the terms of the Memorandum of Association.

The management of the charitable company is the responsibility of the Governors. Any current Governor is entitled to nominate a prospective Governor, appointments being made by a simple majority of current Governors at a Governors' meeting.

Policies adopted for the induction and training of Governors

Governors' attention is brought to support material and guidance provided by Charity Commission, to which they are continuously encouraged to refer.

The Board of Governors

At 31 March 2025, the Board comprised eight members, led by the Chair, Caroline Mortlock. The Board controls the charitable company’s strategic direction and continuously review its operating and financial position.

The Board recognises that good governance is integral to the delivery of quality services and considers that the Charity complies with the National Housing Federation Code of Governance 2020 in all material aspects.

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Structure, governance and management (continued)

Organisational structure and decision-making policies

The Board has an established governance framework, which encourages all members to bring an independent judgement to bear on issues of strategy, performance, resources (including key appointments) and standards of conduct.

The Board is supplied with timely and relevant information to enable it to discharge its duties. Board papers are normally distributed at least a week in advance of the relevant meeting, and the papers are sufficiently detailed to enable the members to obtain a thorough grasp of the company’s management and financial performance. The Board’s terms of reference make provision for it to receive independent professional advice to enable it to carry out its duties.

The Board met seven times during 2024/25.

Risk management

The Governors have reviewed the major risks to which the Charity is exposed and continue to monitor the arrangements and systems in place to mitigate those risks.

The termination of contractual relationships with the universities in Newcastle has meant that the charity now has to manage lettings directly with occupants. The market place is very competitive as additional space has become available, which has had an impact on pricing. The Governors manage this by ensuring that their offering is attractive and cost effective to maximise takeup.

The Charity is exposed to regulatory risks non-compliance of which may affect its ability to operate. These are mitigated by constant monitoring by the Governors through their regular meetings and reports by the Senior Management Team.

The Charity is also exposed to investment risk. This is mitigated by the employment of Cazenove Capital as investment manager on a full discretionary management basis.

Internal controls

The Governors have established internal controls designed to safeguard assets, manage the risk of fraud or misstatement and generally to assist with proper governance. They review these controls on an annual basis to satisfy that they are complete and effective.

Compliance with the governance and financial viability standard

The Governors undertake an annual assessment of their compliance with the Governance and Financial Viability Standard and confirm the Charity’s compliance with the Standard during the course of the year and up to the signing of the financial statements.

The Governors have adopted the National Housing Federation Code of Governance 2020.

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Plans for future periods

The Governors continue to monitor the provision of social accommodation at both houses, and in particular Clapham House. At present there are no plans to change any of the services provided for the charitable purpose.

Members' liability

The Members of the Charity (who are the Governors) guarantee to contribute an amount not exceeding £1 to the assets of the Charity in the event of winding up while he/she is a member or within one year after he/she ceases to be a member for the debts and liabilities contracted before he/she ceases to be a member.

Statement of Governors' responsibilities

The Governors (who are also the directors of the Charity for the purposes of company law) are responsible for preparing the Governors' report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the Governors to prepare financial statements for each financial . Under company law, the Governors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Charity and of its incoming resources and application of resources, including its income and expenditure, for that period. In preparing these financial statements, the Governors are required to:

The Governors are responsible for keeping adequate accounting records that are sufficient to show and explain the Charity's transactions and disclose with reasonable accuracy at any time the financial position of the Charity and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Disclosure of information to auditors

Each of the persons who are Governors at the time when this Governors' report is approved has confirmed that:

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

GOVERNORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2025

Auditors

The auditors, Kinnair Associates Limited, have indicated their willingness to continue in office. The designated Governors will propose a motion reappointing the auditors at a meeting of the Governors.

Approved by order of the members of the board of Governors on 12 September 2025 and signed on their behalf by:

Miss C Mortlock (Chair of Trustees)

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF NORTH EAST HOUSING ASSOCIATION LIMITED

Opinion

We have audited the financial statements of North East Housing Association Limited (the 'charity') for the year ended 31 March 2025 which comprise the Statement of financial activities, the Income and expenditure account, the Balance sheet, the Statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

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

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF NORTH EAST HOUSING ASSOCIATION LIMITED (CONTINUED)

Other information

The other information comprises the information included in the Annual report other than the financial statements and our Auditors' report thereon. The Governors are responsible for the other information contained within the Annual report. 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. 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 matters 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 charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Governors' report.

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

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF NORTH EAST HOUSING ASSOCIATION LIMITED (CONTINUED)

Responsibilities of governors

As explained more fully in the Governors' responsibilities statement, the Governors (who are also the directors of the charitable company for the purposes of company law) 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 Governors 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 Governors are responsible for assessing the charitable 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 Governors either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 Auditors' 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:

We assessed the susceptibility of the Charitable company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: -

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Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF NORTH EAST HOUSING ASSOCIATION LIMITED (CONTINUED)

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: -

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the trustees and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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

Use of our report

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

Detlev Anderson (Senior statutory auditor)

for and on behalf of

Kinnair Associates Limited

Chartered Accountants Statutory Auditor Aston House Redburn Road Newcastle upon Tyne NE5 1NB

12 September 2025

Page 13

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 MARCH 2025

Note
Income from:
Charitable activities
4
Investments
5
Other income
6
Total income
Expenditure on:
Raising funds
7
Charitable activities
8
Total expenditure
Net income before net gains on
investments
Net gains on investments
Net income
Transfers between funds
18
Net movement in funds before other
recognised gains/(losses)
Other recognised gains/(losses):
Actuarial losses on defined benefit
pension schemes
25
Net movement in funds
Reconciliation of funds:
Total funds brought forward
Net movement in funds
Total funds carried forward		 Restricted
funds
2025
£
-
-
-
-
-
-
-
-
-
-
(112,970)
(112,970)
-
(112,970)
4,970,680
(112,970)
4,857,710		 Unrestricted
funds
2025
£
1,622,698
44,055
10,891
1,677,644
13,578
1,600,745
1,614,323
63,321
19,624
82,945
112,970
195,915
(17,000)
178,915
2,020,514
178,915
2,199,429		 Total
funds
2025
£
1,622,698
44,055
10,891
1,677,644
13,578
1,600,745
1,614,323
63,321
19,624
82,945
-
82,945
(17,000)
65,945
6,991,194
65,945
7,057,139		 Total
funds
2024
£
1,557,911
24,499
10,859
1,593,269
11,847
1,533,537
1,545,384
47,885
87,213
135,098
-
135,098
(42,000)
93,098
6,898,096
93,098
6,991,194

The Statement of financial activities includes all gains and losses recognised in the year.

The notes on pages 19 to 43 form part of these financial statements.

Page 14

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

SUMMARY INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 MARCH 2025

Note
Income
Gains on investments
Gross income in the reporting period
Less: Total expenditure
Net income for the reporting period		 Total funds
2025
£
1,677,644
19,624
1,697,268
(1,614,323)
82,945		 Total funds
2024
£
1,593,269
87,213
1,680,482
(1,545,384)
135,098

The notes on pages 19 to 43 form part of these financial statements.

Page 15

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee) REGISTERED NUMBER: 00702712

BALANCE SHEET AS AT 31 MARCH 2025

Note
Fixed assets
Tangible assets
13
Investments
14
Current assets
Debtors
15
Cash at bank and in hand
Current liabilities
Creditors: amounts falling due within one
year
16
Net current assets
Total assets less current liabilities
Net assets excluding pension liability
Defined benefit pension scheme liability
25
Total net assets		 37,080
519,706
556,786
(128,194)		 2025
£
4,962,581
1,765,966
6,728,547
428,592
7,157,139
7,157,139
(100,000)
7,057,139		 30,923
431,774
462,697
(163,036)		 2024
£
5,089,524
1,720,009
6,809,533
299,661
7,109,194
7,109,194
(118,000)
6,991,194

Page 16

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee) REGISTERED NUMBER: 00702712

BALANCE SHEET (CONTINUED) AS AT 31 MARCH 2025

Note
Charity funds
Restricted funds
18
Unrestricted funds
18
Total funds		 2025
£
4,857,710
2,199,429
7,057,139		 2024
£
4,970,680
2,020,514
6,991,194

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

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

The financial statements were approved and authorised for issue by the Governors on 12 September 2025 and signed on their behalf by:

Miss C Mortlock (Trustee)

Miss V Gray

The notes on pages 19 to 43 form part of these financial statements.

Page 17

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2025

Note
Cash flows from operating activities
Net cash used in operating activities
21
Cash flows from investing activities
Dividends, interests and rents from investments
Proceeds from sale of investments
Purchase of investments
Net cash provided by/(used in) investing activities
Cash flows from financing activities
Net cash provided by financing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
22
The notes on pages 19 to 43 form part of these financial statements		 2025
£
70,210
44,055
(767,096)
740,763
17,722
-
87,932
431,774
519,706		 2024
£
162,003
24,499
352,171
(863,223)
(486,553)
-
(324,550)
756,324
431,774

Page 18

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

1. General information

The company is a company limited by guarantee. The company is registered in England & Wales and its company registration number is 00702712. The charity is registered with the Charity Commission and its registered number is 201653.

It is also registered under the Housing and Regeneration Act 2008 and its registered number is H2168.

Its registered office address is Jesmond House, Clayton Road, Newcastle upon Tyne, NE2 1UJ.

2. Accounting policies

2.1 Basis of preparation of financial statements

The financial statements have been prepared in accordance with the Charities SORP (FRS 102) - Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

North East Housing Association Limited meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy.

The financial statements are presented in pounds Sterling and rounded to the nearest pound.

2.2 Going concern

The Governors have considered the resources available to the Charity and have satisfied themselves that it has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to prepare these financial statements on the basis that the Charitable Company is a going concern.

2.3 Income

All income is recognised once the Charity has entitlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably.

Income tax recoverable in relation to investment income is recognised at the time the investment income is receivable.

Other income is recognised in the period in which it is receivable and to the extent the goods have been provided or on completion of the service.

2.4 Expenditure

Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity.

Page 19

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

2. Accounting policies (continued)

2.4 Expenditure (continued)

Expenditure on raising funds includes all expenditure incurred by the Charity to raise funds for its charitable purposes and includes costs of all fundraising activities events and non-charitable trading.

Expenditure on charitable activities is incurred on directly undertaking the activities which further the Charity's objectives, as well as any associated support costs.

All expenditure is inclusive of irrecoverable VAT.

2.5 Government grants

Government grants relating to tangible fixed assets are treated as deferred income and released to the Statement of financial activities upon the completion of the relevant performance-related conditions. Other grants that are not subject to performance-related conditions are credited to the Statement of financial activities as the grant proceeds are received. Grants received prior to the revenue recognition criteria being satisfied are recognised as a liability.

2.6 Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the Charity; this is normally upon notification of the interest paid or payable by the institution with whom the funds are deposited.

2.7 Tangible fixed assets and depreciation

Tangible fixed assets are initially recognised at cost. After recognition, under the cost model, tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. All costs incurred to bring a tangible fixed asset into its intended working condition should be included in the measurement of cost.

As permitted by the Housing Association SORP 2014 the Charity elected to measure properties at their value on the date of transition to the SORP and use that fair value as "Deemed cost" at that date.

A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the statement of financial activities incorporating income and expenditure account.

Page 20

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

2. Accounting policies (continued)

2.7 Tangible fixed assets and depreciation (continued)

Depreciation is charged so as to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following bases:

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

2.8 Investments

Fixed asset investments are a form of financial instrument and are initially recognised at their transaction cost and subsequently measured at fair value at the Balance sheet date, unless the value cannot be measured reliably in which case it is measured at cost less impairment. Investment gains and losses, whether realised or unrealised, are combined and presented as ‘Gains/(Losses) on investments’ in the Statement of financial activities.

2.9 Debtors

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

2.10 Cash at bank and in hand

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

2.11 Liabilities and provisions

Liabilities and provisions are recognised when there is an obligation at the Balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably.

Liabilities are recognised at the amount that the Charity anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide.

Provisions are measured at the best estimate of the amounts required to settle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised in the Statement of financial activities as a finance cost.

Page 21

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

2. Accounting policies (continued)

2.12 Financial instruments

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

2.13 Operating leases

Rentals paid under operating leases are charged to the Statement of financial activities on a straight line basis over the lease term.

2.14 Pensions

The Charity operates a defined benefits pension scheme and the pension charge is based on a full actuarial valuation dated 30 September 2017.

2.15 Fund accounting

General funds are unrestricted funds which are available for use at the discretion of the Governors in furtherance of the general objectives of the Charity and which have not been designated for other purposes.

Designated funds comprise unrestricted funds that have been set aside by the Governors for particular purposes. The aim and use of each designated fund is set out in the notes to the financial statements.

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

Investment income, gains and losses are allocated to the appropriate fund.

2.16 Works to properties and housing furniture replacement

Costs of works to properties and replacing housing furniture are charged to the statement of financial activities in the year of expenditure unless the expenditure results in an enhancement of the economic benefit in excess of that of the assets improved or replaced.

Page 22

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

3. Critical accounting estimates and areas of judgment

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions:

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

Critical areas of judgment:

Depreciation

Tangible fixed assets are depreciated over their useful lives taking into account residual values where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing the asset lives, factors such as maintenance programmes are taken into account. Residual values consider matters such as future market conditions, the remaining estimated life of the asset and the discount required to apply to cash flows on estimated disposal values to calculate their net present values.

Defined Benefit Pension Scheme

The company has obligations to pay pension benefits to certain employees. The cost of those benefits and the present value of the obligations depend on a number of factors, including life expectancy, salary increases, asset valuations, and the discount rate used on certain investments. Estimates are required in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends.

4. Income from charitable activities

Unrestricted
funds
2025
£
Social Housing Lettings and service charges
1,622,698
Unrestricted
funds
2024
£
Social Housing Lettings and service charges
1,557,911		 Total
funds
2025
£
1,622,698
Total
funds
2024
£
1,557,911

Page 23

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

Income as reported includes:

2025
2024
£
£
Maximum rent receivable 1,720,681
1,630,625
Less: Voids (97,983)
(72,714)
1,622,698
1,557,911

The units of accommodation are:

2025
2024
Number
Number
Studios 18
18
Cluster flats 124
124
Single rooms 84
84
226
226

5. Investment income

Unrestricted
funds
2025
£
Income from listed investments
13,670
Investment income - interest received
2,900
Investment income
27,485
44,055		 Total
funds
2025
£
13,670
2,900
27,485
44,055

Page 24

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

5. Investment income (continued)

Income from local listed investments
Investment income - interest received		 Unrestricted
funds
2024
£
23,952
547
24,499		 Total
funds
2024
£
23,952
547
24,499

6. Other incoming resources

Unrestricted
funds
2025
£
Rent received from third parties
10,891
Unrestricted
funds
2024
£
Rent received from third parties
10,859
Investment management costs
Unrestricted
funds
2025
£
Investment management fees
13,578		 Total
funds
2025
£
10,891
Total
funds
2024
£
10,859
Total
funds
2025
£
13,578

7. Investment management costs

Page 25

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

7. Investment management costs (continued)

Unrestricted Total
funds funds
2024 2024
£ £
Investment management fees 11,847 11,847

8. Analysis of expenditure on charitable activities

Summary by fund type

Unrestricted
funds
2025
£
Charitable activities
1,600,745
Unrestricted
funds
2024
£
Charitable activities
1,533,537		 Total
2025
£
1,600,745
Total
2024
£
1,533,537

9. Analysis of expenditure by activities

Activities
undertaken Support Total
directly costs funds
2025 2025 2025
£ £ £
Charitable activities 1,203,637 397,108 1,600,745

Page 26

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

9. Analysis of expenditure by activities (continued)

Charitable activities
Analysis of direct costs
Pension finance costs
Staff costs
Depreciation
Catering
Water rates
Utilities
Repairs and maintenance
Insurance
Cleaning and security
Refurbishment and furniture replacement
Other estate costs
Bad debts
Managed Internet		 Activities
undertaken
directly
2024
£
1,161,064		 Support
costs
2024
£
372,473
Charitable
activities
2025
£
5,000
425,004
115,000
60,073
44,373
241,448
148,698
50,830
39,902
45,989
9,105
1,580
16,635
1,203,637		 Total
funds
2024
£
1,533,537
Total
funds
2025
£
5,000
425,004
115,000
60,073
44,373
241,448
148,698
50,830
39,902
45,989
9,105
1,580
16,635
1,203,637

Page 27

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

9. Analysis of expenditure by activities (continued)

Analysis of direct costs (continued)

Pension finance costs
Staff costs
Depreciation
Catering
Water rates
Utilities
Repairs and maintenance
Insurance
Cleaning and security
Refurbishment and furniture replacement
Other estate costs
Bad debts
Managed Internet
Analysis of support costs
Staff costs
Depreciation
Equipment leasing
Telephone and postage
Publicity, printing and stationery
Travel expenses
Office expenses
Bank charges
Auditors remuneration
Legal and professional fees		 Charitable
activities
2024
£
5,000
393,830
115,000
60,760
35,734
230,094
149,509
40,022
33,479
72,284
9,637
7,700
8,015
1,161,064
Charitable
activities
2025
£
288,143
11,943
4,076
2,772
16,566
764
33,503
2,141
12,950
24,250
397,108		 Total
funds
2024
£
5,000
393,830
115,000
60,760
35,734
230,094
149,509
40,022
33,479
72,284
9,637
7,700
8,015
1,161,064
Total
funds
2025
£
288,143
11,943
4,076
2,772
16,566
764
33,503
2,141
12,950
24,250
397,108

Page 28

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

9. Analysis of expenditure by activities (continued)

Analysis of support costs (continued)

Staff costs
Depreciation
Equipment leasing
Telephone and postage
Publicity, printing and stationery
Travel expenses
Office expenses
Bank charges
Auditors remuneration
Legal and professional fees
Auditors' remuneration
Fees payable to the Charity's auditor for the audit of the Charity's annual
accounts
Fees payable to the Charity's auditor in respect of:
All non-audit services not included above		 Charitable
activities
2024
£
265,106
16,012
1,459
3,013
16,888
839
35,188
1,983
12,540
19,445
372,473
2025
£
12,950
7,500		 Total
funds
2024
£
265,106
16,012
1,459
3,013
16,888
839
35,188
1,983
12,540
19,445
372,473
2024
£
11,330
1,210

10. Auditors' remuneration

Page 29

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

11. Staff costs

Wages and salaries
Social security costs
Contribution to defined contribution pension schemes		 2025
£
639,496
54,578
19,073
713,147		 2024
£
593,752
47,740
17,444
658,936

The average number of persons employed by the Charity during the year was as follows:

Management
Maintenance and domestic		 2025
No.
16
16
32		 2024
No.
14
14
28

No employee received remuneration amounting to more than £60,000 in either year.

The total employee benefits of the key management personnel of the Charity was £112,064 (2024 - £101,784).

12. Governors' remuneration and expenses

During the year, no Governors received any remuneration or other benefits (2024 - £NIL) .

During the year ended 31 March 2025, expenses totalling £ 305 were reimbursed or paid directly to 3 Governors (2024 - £55 to 2 Governors) . The expenses reimbursed related to travel expenses incurred.

Page 30

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

13. Tangible fixed assets

Cost or valuation
At 1 April 2024
At 31 March 2025
Depreciation
At 1 April 2024
Charge for the year
At 31 March 2025
Net book value
At 31 March 2025
At 31 March 2024		 Freehold
property
£
5,750,000
5,750,000
690,000
115,000
805,000
4,945,000
5,060,000		 Plant and
machinery
£
7,348
7,348
6,490
606
7,096
252
858		 Office
equipment
£
248,054
248,054
219,388
11,337
230,725
17,329
28,666		 Total
£
6,005,402
6,005,402
915,878
126,943
1,042,821
4,962,581
5,089,524

The freehold properties were valued in March 2015 to establish a deemed cost on transition to FRS102 and the Statement of Recommended Practice for Social Housing Providers 2014, as follows: Clapham House was valued at £3,750,000 and Jesmond House at £2,000,000. The valuations were performed by Johnson Tucker, Chartered Surveyors on an existing use open market basis.

Had the properties been accounted for at cost and depreciated, the net book value at 31 March 2025 would have been £2,172,109 (2024 - £2,242,236).

Page 31

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

14. Fixed asset investments

Cost or valuation
At 1 April 2024
Additions
Disposals
Revaluations
At 31 March 2025
Net book value
At 31 March 2025
At 31 March 2024		 Listed
investments
£
1,162,830
701,910
(740,763)
19,624
1,143,601
1,143,601
1,162,830		 Other fixed
asset
investments
£
557,179
65,186
-
-
622,365
622,365
557,179
2025		 Other fixed
asset
investments
£
557,179
65,186
-
-
622,365
622,365
557,179
2025		 Total
£
1,720,009
767,096
(740,763)
19,624
1,765,966
1,765,966
1,720,009
2024
£ £
SPDR S&P 500 UCITS ETF 77,162 55,968
Vanguard S&P 500 UCITS - 90,963
JP Morgan America Equity Fund C USD 97,554 95,238
iShares S&P 500 Swap UCITS ETF, GBP-Distribution 77,069 -
0.375 % UK, 2021-22.10.26 Treasury Gilt 68,794 -
1.125 % UK Gilt 31.01.2029 66,450 -
HSBC Global Government Bond Index 89,607 -
251,785 242,169

Page 32

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

15. Debtors

Due within one year
Trade debtors
Prepayments and accrued income		 2025
£
26,015
11,065
37,080		 2024
£
21,193
9,730
30,923

16. Creditors: Amounts falling due within one year

Trade creditors
Other taxation and social security
Other creditors
Accruals and deferred income		 2025
£
18,102
21,200
45,493
43,399
128,194		 2024
£
44,815
19,374
50,846
48,001
163,036

17. Financial instruments

2025 2024
£ £
Financial assets
Financial assets measured at fair value through income and expenditure 519,706 1,720,009

Financial assets measured at fair value through income and expenditure comprise listed investments.

Page 33

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

18. Statement of funds

Statement of funds - current year

Balance at 1
April 2024
£
Unrestricted
funds
General funds -
all funds
2,012,371
Extraordinary
repairs
126,143
Pension reserve
(118,000)
2,020,514
Restricted
funds
Revaluation
reserve
2,287,011
Housing
Association
Grant
2,683,669
4,970,680
Total of funds
6,991,194		 Income
£
Expenditure
£
1,677,644
(1,649,323)
-
-
-
35,000
1,677,644
(1,614,323)
-
-
-
-
-
-
1,677,644
(1,614,323)		 Transfers
in/out
£
112,970
-
-
112,970
(51,977)
(60,993)
(112,970)
-		 Gains/
(Losses)
£
19,624
-
(17,000)
2,624
-
-
-
2,624		 Balance at
31 March
2025
£
2,173,286
126,143
(100,000)
2,199,429
2,235,034
2,622,676
4,857,710
7,057,139

Page 34

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

18. Statement of funds (continued)

Statement of funds - prior year

Unrestricted
funds
General funds -
all funds
Extraordinary
repairs
Pension reserve
Restricted
funds
Revaluation
reserve
Housing
Association
Grant
Total of funds		 Balance at
1 April 2023
£
1,733,610
188,836
(108,000)
1,814,446
2,338,988
2,744,662
5,083,650
6,898,096		 Income
£
1,593,269
-
-
1,593,269
-
-
-
1,593,269		 Expenditure
£
(1,466,691)
(62,693)
(16,000)
(1,545,384)
-
-
-
(1,545,384)		 Transfers
in/out
£
64,970
-
48,000
112,970
(51,977)
(60,993)
(112,970)
-		 Gains/
(Losses)
£
87,213
-
(42,000)
45,213
-
-
-
45,213		 Balance at
31 March
2024
£
2,012,371
126,143
(118,000)
2,020,514
2,287,011
2,683,669
4,970,680
6,991,194

Page 35

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

18. Statement of funds (continued)

Unrestricted funds:

Extraordinary repair fund:

These are funds set aside for expenditure on the properties. The Governors have agreed that the reserve may be used for either or both of the properties in relation to future major repairs.

General funds:

These are 'free reserves' after allowing for the extraordinary repair fund and pension reserve.

Restricted funds:

(a) Revaluation reserve - representing the surplus on revaluation of the two properties owned by the Charity as reduced by the revaluation element of the accumulated depreciation charge on the properties.

(b) Housing Association Grant - this represents monies received in relation to the build and development of Clapham House. Under the revised Housing SORP, such grants under the performance model are recognised as income.

19. Summary of funds

Summary of funds - current year

Balance at 1
April 2024
£
General funds
2,020,514
Restricted funds
4,970,680
6,991,194		 Balance at 1
April 2024
£
General funds
2,020,514
Restricted funds
4,970,680
6,991,194		 Income
£
Expenditure
£
1,677,644
(1,614,323)
-
-
1,677,644
(1,614,323)
Income
£
Expenditure
£
1,593,269
(1,545,384)
-
-
1,593,269
(1,545,384)		 Transfers
in/out
£
112,970
(112,970)
-
Transfers
in/out
£
112,970
(112,970)
-		 Gains/
(Losses)
£
2,624
-
2,624
Gains/
(Losses)
£
45,213
-
45,213		 Balance at
31 March
2025
£
2,199,429
4,857,710
7,057,139
Balance at
31 March
2024
£
2,020,514
4,970,680
Summary of funds - prior year
General funds
Restricted funds		 Balance at
1 April 2023
£
1,814,446
5,083,650
6,898,096
6,991,194

Page 36

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

20. Analysis of net assets between funds

Analysis of net assets between funds - current year

Tangible fixed assets
Fixed asset investments
Current assets
Creditors due within one year
Provisions for liabilities and charges
Total
Analysis of net assets between funds - prior year
Tangible fixed assets
Fixed asset investments
Current assets
Creditors due within one year
Provisions for liabilities and charges
Total		 Restricted
funds
2025
Unrestricted
funds
2025
£
£
4,857,710
104,871
-
1,765,966
-
556,786
-
(128,194)
-
(100,000)
4,857,710
2,199,429
Restricted
funds
2024
Unrestricted
funds
2024
£
£
4,970,680
118,844
-
1,720,009
-
462,697
-
(163,036)
-
(118,000)
4,970,680
2,020,514		 Total
funds
2025
£
4,962,581
1,765,966
556,786
(128,194)
(100,000)
7,057,139
Total
funds
2024
£
5,089,524
1,720,009
462,697
(163,036)
(118,000)
6,991,194

Page 37

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

21. Reconciliation of net movement in funds to net cash flow from operating activities

Net income for the year (as per Statement of Financial Activities)
Adjustments for:
Depreciation charges
(Gains)/losses on investments
Dividends, interests and rents from investments
Increase in debtors
Increase/(decrease) in creditors
Defined benefit pension scheme finance cost
Defined benefit pension scheme cost less contributions payable
Net cash provided by operating activities
22.
Analysis of cash and cash equivalents
Cash in hand
Total cash and cash equivalents
23.
Analysis of changes in net debt		 2025
£
82,945
126,943
(19,624)
(44,055)
(6,157)
(52,842)
(17,000)
-
70,210
2025
£
519,706
519,706		 2024
£
135,098
131,012
(87,213)
(24,499)
(2,489)
42,094
8,000
(40,000)
162,003
2024
£
431,774
431,774
Cash at bank and in hand At 1 April
2024
£
431,774
431,774		 Cash flows
£
87,932
87,932		 At 31 March
2025
£
519,706
519,706

Page 38

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED

(A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

24. Contingent liabilities

There is a contingent liability to repay the Housing Association Grant of £3,049,627 in certain circumstances including the disposal of the properties in respect of which the grant was received.

There were no other material contingent liabilities at 31 March 2025 (2024 - £nil).

25. Pension commitments

The Charity operates a defined benefit pension scheme.

The company participates in the Social Housing Pension Scheme (the Scheme), a multi-employer scheme which provides benefits to some 500 non-associated employers. The Scheme is a defined benefit scheme in the UK.

The Scheme is subject to the funding legislation outlined in the Pension Act 2004 which came into force on 30 December 2005. This, together with documents issued by the Pensions Regulator and Technical Actuarial Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK.

The last triennial valuation of the Scheme for funding purposes was carried out as at 30 September 2017. This valuation revealed a deficit of £1.522 million. A recovery plan has been put in place with the aim of removing this deficit by 30 September 2026. The Scheme's website indicates that the 2020 triennial valuation would have been released in spring 2021, but this has not yet been released.

The Scheme is classified as a "last man standing arrangement". Therefore the company is potentially liable for other participating employers' obligations if those employers are unable to meet their share of the Scheme deficit following withdrawal from the Scheme. Participating employers are legally required to meet their share of the Scheme deficit on an annuity purchase basis on withdrawal from the Scheme.

For financial years ending on or before 28 February 2019, it has not been possible for the company to obtain sufficient information to enable it to account for the Scheme as a defined benefit scheme; therefore the company has accounted for the Scheme as a defined contribution scheme.

For financial years ending on or after 31 March 2019, it is possible to obtain sufficient information to enable the company to account for the Scheme as a defined benefit scheme.

For accounting purposes, two actuarial valuations for the scheme were carried out with effective dates of 31 March 2018 and 30 September 2018. The liability figures from each valuation are rolled forward to the relevant accounting dates, if applicable, and are used in conjunction with the company's fair share of the Scheme's total assets to calculate the company's net deficit or surplus at the accounting period start and end dates.

The following information is provided for a comprehensive understanding of the position of the company with regard to its defined benefit obligations.

Page 39

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

25. Pension commitments (continued)

Principal actuarial assumptions at the Balance sheet date (expressed as weighted averages):

At 31 March At 31 March
2025 2024
% %
Discount rate 5.73 4.87
Inflation (RPI) 3.13 3.19
Inflation (CPI) 2.76 2.76
Salary growth 3.76 3.76
At 31 March At 31 March
2025 2024
Years Years
Mortality rates (in years)
- for a male aged 65 now 20.5 20.5
- at 65 for a male aged 45 now 23 23
- for a female aged 65 now 21.7 21.8
- at 65 for a female aged 45 now 24.5 24.4

Page 40

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

25. Pension commitments (continued)

The Charity's share of the assets in the scheme was:

Global equity
Absolute return
Distressed opportunities
Credit Relative Value
Alternative Risk Premia
Liquid Alternatives
Emerging Markets Debt
Risk Sharing
Insurance-Linked Securities
Property
Infrastructure
Private Equity
Real Assets
Opportunistic Illiquid Credit
Private Credit
Credit
Investment Grade Credit
Cash
Long Lease Property
Secured Income
Liability Driven Investment
Currency Hedging
Net Current Assets
Total fair value of assets		 At 31 March
2025
£
60,000
-
-
-
-
100,000
-
-
2,000
27,000
-
-
64,000
-
66,000
21,000
17,000
7,000
-
9,000
163,000
1,000
1,000
538,000		 At 31 March
2024
£
50,000
19,000
18,000
16,000
16,000
-
6,000
29,000
3,000
20,000
50,000
20,000
-
20,000
-
-
-
10,000
3,000
15,000
203,000
-
1,000
499,000

The actual return on scheme assets was £(24,000) (2024 - £(21,000)) .

Page 41

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

25. Pension commitments (continued)

The amounts recognised in the Statement of financial activities are as follows:

Current service cost
Interest income
Interest cost
Expenses
Total amount recognised in the Statement of financial activities		 2025
£
9,000
(25,000)
30,000
3,000
17,000		 2024
£
8,000
(23,000)
28,000
3,000
16,000

Movements in the present value of the defined benefit obligation were as follows:

Opening defined benefit obligation
Interest cost
Member contributions
Actuarial (gains)/losses
Benefits paid
Expenses
Current service costs
Closing defined benefit obligation		 2025
£
617,000
30,000
7,000
(7,000)
(21,000)
3,000
9,000
638,000

Movements in the fair value of the Charity's share of scheme assets were as follows:

Opening fair value of scheme assets
Expected return on assets
Actuarial losses
Contributions by employer
Contributions by scheme participants
Benefits paid
Closing fair value of scheme assets		 2025
£
499,000
25,000
(24,000)
52,000
7,000
(21,000)
538,000

Page 42

Docusign Envelope ID: FC2615E4-B1C0-4C80-9B5B-9CDC6BD3F195

NORTH EAST HOUSING ASSOCIATION LIMITED (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025

26. Operating lease commitments

The Charity had no commitments under non-cancellable operating leases at 31 March 2025.

27. Members' liability

Each member of the charitable company undertakes to contribute to the assets of the company in the event of it being wound up while he/she is a member, or within one year after he/she ceases to be a member, such amount as may be required, not exceeding £1 for the debts and liabilities contracted before he/she ceases to be a member.

28. Related party transactions

The Charity has not entered into any related party transaction during the year (2024 - £nil) , nor are there any outstanding balances owing between related parties and the Charity at the year end (2024 - £nil).

Page 43

Audit Planning Report to the Board of

North East Housing Association Limited

In respect of the audit of the financial statements for the year ended 31 March 2025. Presented to the Governors on 15 August 2025.

www.kinnair.co.uk

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

 Introduction

Our work for the audit of the financial statements for the year ended 31 March 2025 is currently being planned.

The audit process

Key audit matters

Audit timetable

The purpose of this report is to follow up on our recent conversations, to outline our proposed strategy for the audit of your financial statements and to give you the opportunity to comment on our proposed audit approach. This report is designed to meet the threats to auditor independence from the perspective of an Objective Reasonable and Informed Third Party and to ensure that such a person is informed about the respective roles and responsibilities of an auditor, those charged with governance and management of an entity.

Please note that our audit planning process is updated as necessary to reflect any changes in responsibilities arising from developments in your procedures and systems and to take account of new audit and accounting issues as they arise.

Your senior statutory auditor and the person named as signing your audit report is Detlev Anderson.

Client service team & contact details

Auditor independence

This report is strictly confidential and although it has been made available to you to facilitate discussions it may not be taken as altering our responsibilities to you arising from our audit engagement letter. The contents of this report should not be disclosed to third parties without our prior written consent.

Please do let us have any comments you may have on the contents of this report. In particular, please note that, unless we hear from you to the contrary, we assume that you: -

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

We look forward to working with you and are grateful for your help with our work.

1

4t The audit rocess

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

The audit process

Introduction

Audit objectives

 The audit process

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

The audit of the financial statements will be carried out in accordance with International Standards on Auditing (UK) (“ISAs”). The aims of the audit are to provide an audit report covering a number of matters by: -

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

3

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

 The audit process

The audit process

To meet these objectives it is necessary for us to deliver assurance at four levels: -

Reporting matters of material significance or relevant matters of interest, identified during the course of our audit, to the appropriate UK charity regulator to assist them to ensure that charities show they are being true to their purposes, can demonstrate the difference they are making and meet the high expectations demanded by the public in the way they operate.

For regulators

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

For members and other stakeholders

For the Board

For management

Independent opinions and reports that add credibility to financial information produced by the Charity;

Assistance to the Governors in discharging their corporate governance and compliance responsibilities; and

Observations and advice on financial reporting, taxation and commercial issues from senior professionals who have an in-depth understanding of your business and environment in which you operate.

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

4

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Our Audit Approach

May be summarised as follows: -

 The audit process

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

----- Start of picture text -----
Audit Work
----- End of picture text -----

----- Start of picture text -----
Completion and
Reporting
----- End of picture text -----

----- Start of picture text -----
Audit
Planning
----- End of picture text -----

We will adopt a risk-based audit approach arising from our assessment of your controls in place. We focus on those risks that will have a potential impact on the financial accounting systems and subsequent financial reporting. This enables us to identify and review key risks and assess the controls in place to eliminate or mitigate them. This then allows us to place reliance on controls where appropriate.

5

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

We will carry out more detailed testing supported by substantive work where we perceive these controls to be weak or substantive work is more efficient for our audit. Our assessment of risk is based on specific controls and audit objectives that consider: -

 The audit process

Key audit matters

Audit timetable

We are required to plan and perform our audit using professional scepticism recognising that circumstances may exist that cause the financial statements to be materially misstated.

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Significant risks will be identified on many audits and can be derived from business risks that may result in a material misstatement, relate to unusual transactions that occur infrequently, or judgemental matters where measurement is uncertain. In areas where we identify the potential for significant risk, we will extend our audit testing to include more detailed substantive work. Our work in other areas may be proportionally less.

Reliance on Informed Management

As the Charity is a small entity we may adopt the provisions available for audits of small entities (PAASE) provided by the Financial Reporting Council. This means that we can both prepare the financial statements on your behalf from your accounting records and information you provide us as well as audit them because you have someone in your organisation who understands and is able to approve any accounting adjustments proposed by us as auditor. With your agreement we will liaise with Peter Nielson who will be acting as your informed management unless you inform us to the contrary.

Please be aware that where the PAASE provisions require additional reporting requirements (e.g. where management, selfinterest, familiarity or advocacy threats exist), we have not adopted them but have instead relied upon alternative safeguards.

Materiality

In assessing materiality we have to consider the perception of the normal information needs of users of the Financial Statements as a group, not one category of users, such as the members. We regard a misstatement as material if it would, on

6

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

 The audit process

The audit process

its own, or collectively with other misstatements, affect the actions of the users of the financial statements. In establishing planning and overall materiality levels, which will be reconsidered as the audit progresses, we consider quantitative measures as well as qualitative factors, including: -

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

We have adopted a split materiality for our audit of the financial statements due to the disproportionate value of investments and properties compared to the other transactions and balances in the Charity. We have set our planning materiality at £99,000 for our work on properties, £23,000 for our work in investments and £16,000 for all other areas.

Potential audit adjustments

We will consider potential adjustments individually and collectively and will report any errors, factual or judgemental, over a de-minimis level, to the Board. In respect of any misstatements that remain unadjusted our letter of representation will include confirmation from the Board that they consider those misstatements are not material and do not require adjustment.

We suggest that you agree that we do not report to you those misstatements identified during the course of our audit that are clearly insignificant or trivial. We suggest that the level below which we will not report misstatements to you will be those of £800 and less. If you require a lower value to be used or details of any identified misstatements in a particular area of the financial statements to be reported to you then please let us know before we commence our audit work.

Communications

We are required by ISA (UK) 260 “Communication of audit matters with those charged with governance” to make some specific communications to the Board. Where necessary these are included within this report and a summary of the requirements can be seen in Appendix one.

Risk of fraud and associated misstatement of the financial statements

We request that the Board confirm to us their views on the risks of fraud to the Charity and whether they are aware of any fraud or suspected fraud having occurred during the year or since.

7

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

 The audit process

Key audit matters

Audit timetable

Client service team & contact details

The audit process

We summarise in Appendix one some of the key aspects of potential fraud risk.

We are required to explain the extent to which the audit is considered capable of detecting irregularities, including fraud. However, auditing standards do not require our work on the audit of the financial statements to seek to prevent fraud or misstatement. That said, the fact that an audit is carried out may act as a deterrent.

We plan, perform and evaluate our audit work in order that we may have a reasonable expectation of detecting material misstatements in the financial statements arising from fraud or error. Please note that it is the responsibility of the Board to take such steps as are reasonable to prevent and detect fraud. The Board is also required to acknowledge responsibility for the design, implementation and maintenance of internal control to prevent and detect fraud and to confirm that the Board believes they have appropriately fulfilled those responsibilities.

Please do not hesitate to discuss any aspects of your accounting systems and procedures that you believe may be worthy of further investigation as any review may be most efficiently performed at the same time as our audit of the financial statements.

Our anticipated fees

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

The anticipated fee for our audit and accounts preparation work will be £20,450. This anticipated fee excludes normal disbursements such as travel, printing, bank letter requests, etc. and it also excludes VAT. It is an estimate only (whether stated to be an estimate or quotation) but we will endeavour to ensure that estimates of our fees are as accurate as possible. We will inform you if the estimate requires significant revision particularly should there be a failure on your part to meet your agreed deadlines.

A part of our audit procedures is to seek bank confirmation of year end balances and other information. Historically this was done by way of a “bank letter”. Most banks are now insisting on the use of a computerised bank confirmation system. Unfortunately this means that we are now charged additional software charges which we have to pass on, usually, as a disbursement of £89.00 plus VAT.

Any fee estimate will only apply to the work covered by your initial instructions and we reserve the right to vary the fees if the scope or nature of those instructions change. Any verbal estimate will be confirmed in writing. Any estimate provided is given in good faith as a guideline but cannot always be adhered to. You will be advised in writing if the nature or circumstance of the work being undertaken on your behalf changes in such a way as to render the estimate given inappropriate and if possible, a revised estimate will be given.

8

Keya it matters

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

 Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Key audit matters

Audit area and key risks Potential implication for audit approach Planned audit approach
1. Revenue recognition
In accordance with International
Standards on Auditing (ISAs),
there is a presumption that a
significant risk exists in respect of
errors arising on the recognition of
revenues due to the Charity, in
particular that income may be
over or understated.		 The financial statements may contain
material errors arising from
inappropriate recognition of income or
where income has been understated
because it has not been recorded. This
can arise because of the lack of
controls over rentals and voids, errors in
accounting for rentals or fraud.		 As auditors we are required to
consider all the risks of errors arising
from fraud or inappropriate revenue
recognition and design tests to satisfy
ourselves that the risks have been
mitigated or eliminated. Where we
consider that there are no such risks;
we are required to state that fact
and our reasons why. We will review
the rent income process and test via
walkthrough tests and an
‘expectation test’ which will
incorporate voids in the year.
2. Management override
In accordance with ISAs there is a
presumed specific risk relating to
the possibility of management
override through intervention at
prime entry or subsequent journal
entry.		 Accounts comprise entries from books
of prime entry including the cash book,
nominal, sales and purchase ledgers.
Management is in a position to override
entries arising from the books of prime
entry and/or by processing journals to
mask the transactions taking place or
the state of affairs of the Charity.		 We will undertake tests on
transactions arising from prime entry
and review a sample of journals
posted during the year, in the
process of preparing the financial
statements for audit and in the post
balance sheet period to satisfy
ourselves that transactions are
processed for bona-fide reasons.
3. Going concern risk
The term going concern
assumption is the defining
assumption about the condition
of an entity for which adoption of
the going concern basis of
accounting is appropriate: that
the Charity is, and will be able to
continue as, a going concern.
Accordingly the term "going
concern"applies to any entity		 The Board is required to assess whether
the going concern basis of accounting
is appropriate when causing the
financial statements to be
prepared. The assessment should cover
a period at least twelve months beyond
the date upon which you expect to
approve the financial statements. If you
are unable to apply the going concern
basis, the financial statements should
be prepared on a different basis to that		 The auditor's responsibilities are to
obtain sufficient appropriate audit
evidence regarding, and conclude
on:
• Whether a material uncertainty
related to going concern exists;
and
• The appropriateness of
management's use of the going
concern basis of accounting in

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North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

 Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Key audit matters

Audit area and key risks Potential implication for audit approach Planned audit approach unless its management intends to normally adopted. Where there is some the preparation of the financial liquidate the entity or to cease concern, if financial statements have statements. These responsibilities activities or has no realistic been prepared on the going concern exist even if the financial alternative to liquidation or basis, disclosure should be made reporting framework used in the cessation of operations; and the explaining your reasons why this basis preparation of the financial term "ability to continue as a has been adopted and we will require statements does not include an going concern" is equivalent to evidence from you to support this going explicit requirement for the term "ability to continue to concern assertion. For further details, management to make a specific adopt the going concern basis of please see the Financial Reporting assessment of the Charity’s ability accounting" in the future. Council’s Guidance on the Going to continue as a going concern. Concern Basis of Accounting and We will enquire as to the systems and Reporting on solvency and Liquidity controls that the Board has in place Risks at https://www.frc.org.uk/Ourto ensure that they are able to Work/Publications/Accounting-andproperly ascertain the going Reporting-Policy/Guidance-on-theconcern of the business. Going-Concern-Basis-ofAccounting.pdf 4. Related Party Transactions Auditors cannot perform their work on We are required to assess the risk information that is not known to them. It that we have not been informed of The suppression of information relating to any related parties, is therefore incumbent upon the identity of all related parties and whether it be the existence or management to bring to the attention the transactions taking place with disclosure of transactions with of the auditors the details of all related them; the absence of which may them, may lead to significant parties and of the transactions taking lead to significant misstatement in misstatement in the financial place with those parties. There is a the financial statements. We are also statements or failures in the statutory duty to do so and a statement required to assess the controls to that effect in the annual report associated with the identification of governance of your entity. encompassing all those who have a related parties and the transactions duty of governance. taking place with them and to establish whether these transactions are fully and correctly disclosed in the financial statements. Where sufficient controls do not exist; we are required to assess the risk of significant misstatements arising and

11

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

 Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Key audit matters

Audit area and key risks Potential implication for audit approach Planned audit approach
to report these risks to management.
Where appropriate our audit report
will be suitably qualified.
So far as we have ascertained the
related parties we need to be aware
of are as follows:

Governors

Peter Neilsen (key
management)
Please inform us immediately if there
are any additional related parties
that we have not identified above.
5. Accounting Estimates
Accounting estimates are by their
nature imprecise and subjective
but may have a significant effect
on the results disclosed in the
financial statements. As such
there is the potential for a high
degree of uncertainty concerning
accounting estimates and
therefore a risk that significant
misstatement exists in the financial
statements.		 You have to provide us with the details
of accounting estimates contained in
the financial statements, including how
these have been calculated and detail
the relevant controls, use of experts, the
underlying assumptions, any changes
from previous periods and your
assessment of the reasonability and
level of uncertainty. You are also
required to consider alternative
assumptions or outcomes and why
these have been rejected in favour of
those used.		 In response to the assessed risks to our
audit opinion, we are required to
undertake one or more of several
evaluation techniques taking accoun
of the nature and significance of the
accounting estimates used.
We will enquire as to the systems
and controls that the Board has in
place to ensure that significant
accounting estimates are identified
and appropriately calculated and
compare with prior years’ results.
Significant accounting estimates
would comprise:
Depreciation provisions (including
residual value and estimated useful
life of the asset; and
Pension provisions on the multi-
employer defined benefit scheme.

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North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

The extent to which the audit was considered capable of detecting irregularities including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We will design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our planned procedures are capable of detecting irregularities, including fraud is detailed below: -

 Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

We will assess the susceptibility of the Charity’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: -

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

To address the risk of fraud through management bias and override of controls, we will: -

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North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

Key audit matters

In response to the risk of irregularities and non-compliance with laws and regulations, we will design procedures which include, but are not limited to: -

The audit process

 Key audit matters

Audit timetable

Client service team & contact details

There are inherent limitations in our anticipated audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the governors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

14

Client name │ Audit Planning Report │ Year ended date

Contents

Introduction

The audit process

 Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

Audit timetable

Appendix one: Communications, Independence and Fraud

15

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

 Audit timetable

Client service team & contact details

Audit timetable

We have discussed the anticipated audit timetable and we should be grateful if you would now confirm that the audit timetable set out below will meet your requirements and that you will be able to meet your deadlines as follows: -

Audit timetable Responsibility Due by
Pre audit planning meeting All Performed
1 July2025
Your records made available to the accounts and audit teams. NEHA Received
04/07/2025
Audit Planning Report issued to the Board. Kinnair 15/08/2025
Audit fieldwork commences. Kinnair 11/08/2025
Draft Audit Findings Report, and financial statements issued to the Board. Kinnair 04/09/2025
Audit close out meeting. All 04/09/2025
Board approval of the financial statements and letter of representation. NEHA Governors 12/09/2025
Kinnair signing of the audit report. Kinnair 12/09/2025

Auditor independence

Developments in financial reporting and other matters

We confirm that we are able to accommodate the deadlines set out above. Please note that adherence to the timetable is linked to our proposed audit fee. Should there be a failure on your part to meet your agreed deadlines we may incur additional time costs in order to meet the Board approval deadlines which we would seek to recover from you.

Appendix one: Communications, Independence and Fraud

16

Client service team & contact details

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable  Client service team & contact details

Auditor independence

Client service team & contact details

The principal members of the Audit Team are:

Director & Senior Statutory Auditor Detlev Anderson

Detlev Anderson M 07740 823 679 D 0191 286 7777 detlev-anderson @kinnair.co.uk Manager Chris Black M 07771 582569 D 0191 286 7777 chris-black@kinnair.co.uk

Using our audit information portal

We recommend that documents be uploaded to our secure portal at http://uk.casewarecloud.com/Kinnair.

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

18

Auditor I pe

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable

Client service team & contact details

 Auditor independence

Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Auditor independence

Independence

We are bound by our internal procedures and the ethical guidelines laid down by the Financial Reporting Council (FRC) to impose safeguards to ensure our objectivity and independence.

In accordance with ISA 260 and the FRC Revised Ethical Standard 2024 we are required to summarise for your attention any matters that we consider may have a bearing on our integrity, objectivity or independence in connection with the audit of your statutory financial statements. We summarise below those specific matters that we consider may have a bearing on our independence in connection with the audit of your statutory financial statements.

We will formally confirm our independence in our Audit Findings Report at the end of the audit, but for audit planning purposes, we advise that we are not aware of any matters that will prevent us from performing the audit of the financial statements for the accounting period ended 31 March 2025. Subject to the presence of the safeguards set out below, we believe that none of the non-audit services provided on your behalf affect our independence as auditor.

If you have any concerns in connection with our independence please let us know as soon as possible so that we may address these before we commence our audit.

Factor affecting independence Threats to our independence Safeguards imposed to eliminate the
threat
We prepare on behalf of
management the entity’s statutory
financial statements from such
information as is available to us.		 This presents a management and self-
review threat to our independence and
objectivity as auditor.		 You have “informed management”
on whom we are entitled to rely; all
adjustments will be approved by
“informed management” before the
statutory financial statements are
finalised. Also, these adjustments and
any potential adjustments are
disclosed in our Audit Findings Report
presented to the Board at the end of
the audit.

20

Developments in financial reporting and other matters

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North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable

Client service team & contact details

Auditor

independence

 Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Developments in financial reporting and other matters

There are no major changes to UK GAAP financial statements and no other regulatory changes affecting financial reporting this year. The amendments to FRS 102 below, whilst significant, will not affect your financial statements for two years.

Title Description Effective date
Amendments to FRS
102_The Financial_
Reporting Standard
applicable in the UK
and Republic of
Ireland
March 2024		 Revisions have been made to the UK Accounting
Standard FRS 102, which will have significant effects on
how entities account for their revenue and on
accounting for leases.
Significant changes to profit/net income and to the
disclosure of leased assets in the balance sheet will result.
The Charities SORP will be amended accordingly to
reflect these changes.
Those small entities utilising Section 1A of FRS102 should
also note that some disclosures that were previously only
recommended have now been made mandatory. These
include: -
-
Dividends declared, paid or payable during the
period;
-
Going concern material uncertainties.		 Effective for accounting periods
beginning on or after 1 January
2026.
Company Size
threshold changes		 The limits defining the definition of small and medium size
companies have changed.
For small companies, the turnover limit increased from
£10.2m to £15m.
For medium size companies, the turnover limit increased
from £36m to £54m.
The gross asset totals increased to 50% of the new
turnover totals.		 Accounting periods commencing
on or after 6 April 2025.

Whilst not directly affecting financial reporting, an impending change to Companies House is also of interest.

22

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

 Developments in financial reporting and other matters

Appendix one: Communications, Independence and Fraud

Developments in financial reporting and other matters

Title Description Effective date
Changes to
Companies’ House
requirements		 TheEconomic Crime and Corporate Transparency Billreceived
royal assent in Autumn 2023 and will have the following impacts
(amongst others): -
- The exemption for small companies not to file their profit and
loss accounts will be removed.This could have a significant
impact on those small companies whose profit and loss
accounts are commercially sensitive.
- New verification procedures will be required for all registered
company directors and People with Significant Control.
- Charitable companies will be required to file digital accounts.
The requirement will be for iXBRL accounts, rather than merely
an electronic filing of a PDF of the accounts.This increases the
cost and administrative burden on those small charities which
historically have been allowed to file paper copies of their
financial statements. Our charity accounts software has the
capacity to prepare iXBRL accounts for our charitable
company clients so we hope to be able to limit the
administrative burden that will be caused by this change.
The Charity Commission is also expected to suggest that
charities file iXBRL accounts with themselves but it does not
have the authority to demand them.
These impending regulations are causing some charitable
companies to look more closely at converting to a Charitable
Incorporated Organisation. CIOs are not companies and do
not have to comply with the Companies Act or with other
regulations specific to Companies.
Most changes will require additional supporting legislation
which is still to be confirmed.		 In stages from 2025 onwards.

23

Contents

Introduction

The audit process

Key audit matters

Appendix one.

Audit timetable

Client service team

& contact details

Auditor independence

Developments in financial reporting and other matters

Communications, Independence and Fraud

24

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable

Client service team & contact details

Auditor

independence

Developments in financial reporting and other matters

 Appendix one: Communications, Independence and Fraud

Appendix one: Communications, Independence and Fraud

Audit communications

We are required by ISA (UK) 260 “Communication of audit matters with those charged with governance” to make some specific communications to the Board. These are summarised as follows: -

ISA 260 requirement Audit
Planning
Report		 Audit
Findings
Report
Agreement to the terms of engagement, including your undertaking to provide
unfettered access to all information required for the purpose of our audit
Communication of auditors’ responsibility to consider material misstatements in the
financial statements.
Communication of management’s collective responsibility to report any fraudulent
activities to the auditors.
Confirmation of the independence of the firm and audit team members.
Communication of audit scope and approach.
Confirmation by written representations to the auditor by those charged with
governance.
Consideration of significant accounting policies.
Consideration of significant financial estimates.
Consideration of any material risks and exposures.
Consideration of audit materiality.
Consideration of adjusted and unadjusted misstatements, whether factual, judgemental
or projected.
Consideration of uncertainties casting doubt on the ability of the entity to continue as a
going concern.
Consideration of disagreements with management.
Consideration of related parties and associated transactions.
Consideration of post balance sheet events.
Consideration of significant weaknesses in accounting and internal control system.

25

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Appendix one: Communications, Independence and Fraud

Introduction

Kinnair Associates Limited independence policies, safeguards and procedures

The audit process

Safeguards and Procedures

Key audit matters

Audit timetable

Client service team & contact details

Auditor independence

Developments in financial reporting and other matters

 Every audit opinion issued by Kinnair Associates Limited (“the Firm”) is subject to technical review by a director who is registered with the Institute of Chartered Accountants in England and Wales (ICAEW) as a responsible individual (RI).

 Within our Audit Planning Report we report at the beginning of each audit to you on our assessment of our objectivity and independence. This report includes a summary of non-audit services provided over the past year together with fees received in absolute terms and as a proportion of the audit fee. Where these may be perceived to compromise our independence because of the magnitude of fees arising from non-audit services, whether in absolute terms or as a proportion of the audit fee, we bring this to your attention and agree appropriate safeguards to address the perception that our independence and objectivity may be compromised. Where the non-audit fees exceed the audit fee agreed between us, we also must agree appropriate safeguards with our ethics director.

 We are not permitted to charge fees for the audit which are calculated on a contingent basis. Nor are we permitted to undertake non-audit services on a contingent fee basis (whether the fee is material to the firm or not), where the outcome of the non-audit service is dependent on a future or contemporary audit judgement relating to a material matter in the financial statements.

 There is formal consideration and review of the appropriateness of continuing the audit before accepting reappointment.

 Where the audit engagement director has acted for more than 10 years, we subject the audit performed to an Engagement Quality Control Review carried out by an Independent Review Director.

 In accordance with the Ethical Standard issued by the Financial Reporting Council, there is an assessment of the level of threat to objectivity and independence together with potential safeguards to mitigate these threats prior to acceptance of any nonaudit engagement. This would include particular focus on threats arising from self-interest, self-review, management, advocacy, and over-familiarity. Where such threats are identified, if possible, safeguards are put in place such as an Engagement Quality Control Review performed by an Independent Review Director. Alternatively we do not accept the non-audit engagement.

26

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Introduction

The audit process

Key audit matters

Audit timetable

Appendix one: Communications, Independence and Fraud

 The Firm’s policies and procedures are subject to external monitoring by the ICAEW’s Quality Assurance Directorate (QAD). The QAD is charged with monitoring statutory compliance of audits for all entities that are not “economically significant” e.g. listed companies or Public Interest Entities. QAD reports to the ICAEW’s Audit Registration Committee who is charged with the registration of audit firms and RIs operating within them. Please note, the QAD does not publish individual inspection reports and we are not permitted to disclose details of their findings.

 Where the audited entity qualifies as a small entity, we adopt the Provisions Available for Audits of Small Entities (PAASE) if that entity has a person who is considered to be informed management and it has been agree that we may rely on that person and their knowledge and expertise that allows them to be treated as suitably informed.

Ethical and Independence Policies

 no director or immediate family member is allowed to hold a direct or indirect financial interest in any of our audit clients;

Client service team & contact details

Auditor independence

 professional staff or any immediate family member may not work on assignments if they have a financial interest in the client or are a party to a transaction or if they have a beneficial interest in a trust holding a financial position in the audit client;

 no person in a position to influence the conduct and outcome of the audit or any immediate family member should enter into business relationships with any of our audit clients or their affiliates;

 directors and professional employees or their immediate family members are prohibited from obtaining gifts or hospitality from an audit client unless the value is clearly insignificant in terms of their frequency, nature and cost; and

Developments in financial reporting and other matters

 we are required to create safeguards against potential conflicts of interest.

 Appendix one: Communications, Independence and Fraud

27

North East Housing Association Limited │ Audit Planning Report │ Year ended 31 March 2025

Contents

Appendix one: Communications, Independence and Fraud

Introduction

Key Aspects of potential fraud risk

The audit process

The following indicates those areas where fraud risk most often occurs.

Key audit matters

Audit timetable

Fraudulent financial reporting including the provision of misleading information and manipulation or massaging of figures through journal entries and adjustments, accounting estimates, revenue and profit recognition, suspense accounts and reconciliations of balances.

Misappropriation or misuse of assets.

Incurring of expenditure or committing the entity to liabilities for any improper use.

Client service team & contact details

Obtaining revenue or assets by fraud.

Avoiding costs or expenses by fraud.

Auditor independence

Financial misconduct by members of staff or management.

Undisclosed related parties leading to misstatement in the financial statements.

Developments in financial reporting and other matters

28

Conclusion

We hope that you find the information within this audit planning report to be informative and helpful. If you have any comments on how we can improve it, to help you, please let me know.

If you have any questions concerning our planned work please do contact either me or Chris Black.

We look forward to working with you during this year’s audit.

With kind regards,

Detlev Anderson

M 07740 823 679 T 0191 286 7777 E detlev-anderson@kinnair.co.uk

Aston House, Redburn Road, Newcastle upon Tyne, NE5 1NB

32 Portland TerraceKinnair Associates Limited Newcastle upon TyneAston House, Redburn Road NE2 1QP Newcastle upon Tyne T 0191 281 1292NE5 1NB emailftglenton.com

email@kinnair.co.uk www.kinnair.co.uk

29

Registered to carry on audit work in the UK and Ireland and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. Details about our audit registration can be viewed at www.auditregister.org.uk, under reference number C009500017.