OpenCharities

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

2023-03-31-accounts

Almshouse Charity of Elizabeth Smith

Annual Report and Financial Statements Year Ended 31 March 2023

Registered with the Charity Commission Number 210463 Registered with the Regulator of Social Housing Number A3714

Annual Report and Financial Statements For the year ended 31 March 2023

Pages
Strategic Report 2-4
Report of the Board 5
Independent Auditor’s Report to the members of Almshouse Charity of Elizabeth Smith 6-8
Statement of Comprehensive Income 9
Statement of Financial Position 10
Statement of Changes in Reserves 11
Statement of Cash Flows 12
Notes forming part of the Financial Statements 13 - 23

Advisers and bankers

Clerk and Registered Office Bankers Auditor
Vicky Parr
The Heals Building Suites A&B
3rd floor22 – 24 Torrington
Place
London
WC1E 7HJ		 Barclays Bank plc.
1 Churchill Place
Canary Wharf
London
E14 5HP		 BDO LLP
55 Baker Street
London
W1U 7EU

1

Strategic Report For the year ended 31 March 2023

Structure, Governance and Management

Trustee

Anchor Hanover Group is the Corporate Trustee.

The Corporate Trustee receives no remuneration other than the Management Charges disclosed in note 3 and charges for other services provided as disclosed in note 17 of the notes to the Financial Statements.

Details of the membership, structure and policy for admitting new members to the Board of Anchor Hanover Group can be found in the annual report of the Association and on their website at www.anchor.org.uk.

Code of Governance

The Board of the Corporate Trustee, Anchor Hanover Group (“Anchor”), has adopted the Financial Reporting Council’s UK Corporate Governance Code 2018 (the “UKCGC”) as its appropriate code of governance. The UKCGC is applied on a ‘comply or explain’ basis and the Board of Anchor assess their compliance with the code on an annual basis. A summary of this assessment can be found in Anchor’s Annual Report and Financial Statements 2023, page 26.

Employees

The Charity has minimal employees as revealed in Note 4. The administration of the Charity is undertaken by employees of Anchor Hanover Group.

Risk management

The Board of the Corporate Trustee has examined the major strategic, business and operational risks which the Charity faces and confirms that systems and procedures, including an internal audit programme, are in place so as to mitigate the significant risks that the Charity may face.

Objectives and Activities

The governing instrument for the Almshouse Charity is a Charity Commission Scheme dated 1 September 2004.

The Charity’s objective is to provide 10 (2022: 10) almshouse accommodation for older persons covering single, poor and deserving persons, being Christian and resident in the Parish of East Malling.

Governance and Financial Viability Standard

The Corporate Trustee is Anchor Hanover Group, a Private Registered Provider. The Board of Anchor Hanover Group has assessed that it complies with the Governance and Financial Viability 2015 issued by the Regulator of Social Housing.

Achievements and Performance

The Charity receives funds from charges raised on residents in the form of service charges and rent. The service charges are raised to cover the cost of providing support to the residents in relation to the Estate Manager, maintenance of the grounds and the maintenance of equipment. Rents are charged to the residents in line with Government guidance and are used to cover maintenance of the properties in the year and to provide resources to meet cyclical and major repairs over a number of years.

Charitable and political contributions

No contributions were made during the financial year (2022: £Nil).

Financial Review

The activities for the year are set out on page 9 in the Statement of Comprehensive Income. Ordinary activities show a surplus of £16,897 (2022: £46,858). The decrease in surplus is mainly due to a reduction in the gain on the revaluation of current asset investments which was a deficit of £616 (2022: £14,841 surplus).

Capital expenditure incurred in the year was £16,274 (2022: £4,000)

Plans for Future Periods

In line with the Charity’s objective to maintain the properties in good repair and in order to provide accommodation for rent, the Charity continues to review the fabric of the building via planned works programmes and stock condition surveys undertaken by Anchor Hanover Group. At this time there is no immediate significant expenditure required but this will be kept under annual review.

2

Strategic Report For the year ended 31 March 2023 (continued)

Principal risks and uncertainties

There are several risks in the external environment that are contributing to significant challenges for all providers. This includes; effects that have resulted from the UKs exit from the European Union, increased fuel costs, macroeconomic impacts on the global economy linked to the Ukraine crisis, and high inflation levels in the UK.

All of these factors are contributing to the “cost of living” crisis which we are actively managing as a key area of risk, with focus on maintaining service delivery, managing and anticipating financial impacts, and monitoring the potential negative impacts of the conditions on our customers and colleagues.

Maintenance of Elizabeth Smith’s properties is dependent on the timely and effective performance by third party contractors of their obligations, exposing us to risk of potentially having less control over the quality of the services than if we were providing them directly. The performance of contracts may be subject to disruption for a variety of reasons including availability of materials, work stoppages, labour constraints, and is impacted by macroeconomic conditions.

We work closely with contractors to avoid such problems, undertake appropriate due diligence and procurement procedures and avoid concentration risk.

Going concern

After making enquiries and examining major areas which could give rise to significant financial exposure, the directors are satisfied that no material or significant exposures exist other than as reflected in these Financial Statements and the company has adequate resources to continue its operations for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing these Financial Statements.

Value for money statement

As a corporate trust of the Anchor Hanover Group, the strategic and operational management of the properties is fully aligned to the wider stock portfolio of Anchor Hanover Group. As such the approach to VFM for the Corporate Trusts is fully integrated and therefore does not differ to the approach adopted for Anchor Hanover Group. For a copy of the self-assessment we would therefore refer to that contained with Anchor’s annual report.

Under the Value for Money Standard issued by the Regulator of Social Housing in April 2018 and the subsequent Value for Money Metrics Technical Note Guidance updated in May 2021, registered providers with a stock of less than 1,000 units are required to publish their Value for Money metrics. These are shown below for the Charity and are in addition to the overall approach taken to achieving value for money agreed by the Board of Anchor Hanover Group as Corporate Trustee and managing agent.

2023
2022
Metric 1 - Re-investment % 0%
0%

This metric looks at the investment in properties (existing stock as well as New Supply) as a percentage of the value of total properties held. For the Charity with its limited resources the focus is on maintaining its existing properties into the future. Planned and routine maintenance are a part of this and all, but the largest planned works are expended through the Statement of Comprehensive Income and charged to the cyclical and extraordinary repairs reserves.

2023 2022
Metric 2a – New supply delivered (social housing units) % 0% 0%
Metric 2b – New supply delivered (non-social housing units) % 0% 0%

This metric sets out the number of new social housing and non-social housing units that have been acquired or developed in the year as a proportion of total social housing units and non-social housing units owned at period end. The Charity’s focus is on maintaining its existing properties into the future and currently does not have the financial capacity to develop new properties.

3

Strategic Report For the year ended 31 March 2023 (continued)

2023
2022
Metric 3 - Gearing %
0%
0%
This metric assesses how much of the adjusted assets are made up of debt and the degree of dependence on
debt finance. The Charity has no loans or overdraft facilities. The tangible fixed assets which the cash and loans
are compared to is also relatively low as there is no cost associated with the original cost of the properties, only
subsequent capitalised repairs expenditure.
are compared to is also relatively low as there is no cost associated with the
subsequent capitalised repairs expenditure.		 original cost of the properties, only
2023 2020
Metric 4 – EBITDA MRI interest cover % 0% 0%
This metric is a key indicator for liquidity and investment capacity. It seeks to measure the level of surplus that a
registered provider generates, adjusted for amortisation and depreciation, compared to interest payable. The
Charity has no loans or overdraft facilities and, therefore, no interest payable.
2023 2022
Metric 5 – Headline social housing cost per year 3,402 2,225

This metric assesses the headline social housing cost per unit as defined by the Regulator. The decrease in the cost per unit for 2022 is due to a reduction in management costs and major repairs expenditure incurred in the year.

2023 22022
Metric 6a – Operating margin (social housing lettings) % 14% 42%
Metric 6b – Operating margin (overall) % 23% 47%

This metric demonstrates the profitability of operating assets before exceptional expenses are taken into account. Increasing margins are one way to improve the financial efficiency of a business. In assessing this ratio, it is important that consideration is given to registered providers’ purpose and objectives (including their social objectives). The reduction in the ratios for 2023 are a result of there being relatively higher management charges in the year.

2023 2022
Metric 7 – Return on Capital Employed (ROCE) % 2% 5%

This metric compares the operating surplus to total assets less current liabilities and is a common measure in the commercial sector to assess the efficient investment of capital resources.

4

Report of the Board For the year ended 31 March 2023 (continued)

Statement of the Board of the Corporate Trustee’s responsibilities in respect of the Annual Report and the Financial Statements

Under the trust deed and rules of the charity and charity law, the trustees are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and regulations. The trustees have elected to prepare the financial statements in accordance with UK Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.

The financial statements are required by law to give a true and fair view of the state of affairs of the charity and of the excess of income over expenditure for that period.

In preparing these financial statements, generally accepted accounting practice entails that the trustees:

The Board of the Corporate Trustee is required to act in accordance with the governing instrument of the Trust, within the framework of trust law. The Board of the Corporate Trustee is responsible for keeping proper accounting records, sufficient to disclose at any time, with reasonable accuracy, the financial position of the Trust at that time and enable the Board of the Corporate Trustee to ensure that its Financial Statements comply with the Charities Act 2011, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2019. The Board of the Corporate Trustee has general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Trust and to prevent and detect fraud and other irregularities.

Awareness of relevant audit information

The Members of the Board of the Corporate Trustee who held office at the date of approval of this Report of the Board of the Corporate Trustee confirm that, so far as they are each aware, there is no relevant audit information of which the Trust’s auditor is unaware and each Member of the Board of the Corporate Trustee has taken all the steps that they ought to have taken as Members of the Board of the Corporate Trustee to make themselves aware of any relevant audit information and to establish that the Charity’s auditor is aware of that information.

Auditor

BDO LLP has expressed its willingness to continue in office as auditor to the Almshouse Charity of Elizabeth Smith.

A resolution to reappoint BDO LLP as auditor will be approved by the Board of Anchor Hanover Group .

Sarah Jones Executive Board Member

Amanda Holgate Executive Board Member

Vicky Parr Clerk

Date: 25 September 2023

5

Independent Auditor’s Report For the year ended 31 March 2023

INDEPENDENT AUDITOR’S REPORT TO TRUSTEES THE ALMSHOUSE CHARITY OF ELIZABETH SMITH

Opinion on the financial statements

In our opinion, the financial statements:

We have audited the financial statements of the Almshouse Charity of Elizabeth Smith (“the Charity”) for the year ended 31 March 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We remain independent of the Charity in accordance with the ethical requirements relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions related to going concern

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

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Charity’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 Trustees with respect to going concern are described in the relevant sections of this report.

Other information

The Trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our auditor’s report thereon. The other information comprises: the Strategic report and the Directors 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

6

Independent Auditor’s Report For the year ended 31 March 2023 (continued)

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities Act 2011, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2019 requires us to report to you if, in our opinion;

Responsibilities of Trustees

As explained more fully in the Board of the Corporate Trustee’s statement, the Trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the Charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the Charity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

We have been appointed as auditor under Charities Act 2011, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2019 and report in accordance with the Acts and relevant regulations made or having effect thereunder.

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

Extent to which the audit was capable of detecting irregularities, including fraud

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:

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

7

Independent Auditor’s Report For the year ended 31 March 2023 (continued)

A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (“FRC’s”) website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the Charity’s trustees, as a body, in accordance with Charities Act 2011, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2019. Our audit work has been undertaken so that we might state to the Charity’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charity and the Charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

BDO LLP Statutory Auditor Gatwick United Kingdom 26 September 2023

BDO LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

8

Statement of Comprehensive Income For the year ended 31 March 2023

Note
Turnover
2
Operating costs
2
Operating surplus
Interest receivable and similar income
5
Interest payable and similar charges
6
Surplus on ordinary activities
Unrealised (deficit)/surplus on revaluation of current asset investments
9
Total comprehensive income for the year		 2023
2022
£
£
60,787
67,491
(46,879)
(35,533)
————
————
13,908
31,958
3,605
59
-
-
————
————
17,513
32,017
(616)
14,841
————
————
16,897
46,858
~~————~~
~~————~~

There is no material difference between the surplus for the year as stated above and its historical cost equivalent.

All amounts relate to continuing activities.

The notes on pages 13 to 23 form part of these Financial Statements.

9

Statement of Financial Position For the year ended 31 March 2023

2023
Note
£
Fixed assets
Housing properties
10
Other fixed assets
10
Current assets
Trade and other debtors
11
1,021
Short term investment
12
346,688
Cash at bank and in hand
446
Less Creditors: amounts falling due within one
year
13
(26,107)
————
Net current assets
Total assets less current liabilities
Creditors
Amounts falling due after one year
14
Capital and reserves
Revenue reserves
Designated reserves:		 2023
2022
2022
£
£
£
336,604
333,192
3,727
4,230
————
————
340,331
337,422
10,054
323,700
446
(19,090)
————
322,048
315,110
————
————
662,379
652,532
(187,285)
(194,335)
————
————
475,094
458,197
~~————~~
~~————~~
370,925
360,025
104,169
98,172
————
————
475,094
458,197
~~————~~
~~————~~

The notes on pages 13 to 23 form part of these Financial Statements.

.

The Financial Statements were approved for issue on behalf of the Corporate Trustee by the Board of Anchor Hanover Group on 25 September 2023 and were signed by:

Sarah Jones Executive Board Member

Amanda Holgate Executive Board Member

Vicky Parr Clerk

Registered with the Charity Commission Number 210463

10

Statement of Changes in Reserves For the year ended 31 March 2023

Extraordinary Cyclical
Revenue Renewals Repairs Maintenance Total
Reserves Reserve Reserve Reserve Reserves
£ £ £ £ £
At 1 April 2021 319,964 20,045 24,303 47,027 411,339
Transfers (to)/from other reserves (6,797) 507
4,790		 1,500 -
Surplus in year 46,858 - - - 46,858
———— ————
————		 ———— ————
At 31 March 2022 360,025 20,552
29,093		 48,527 458,197
Transfers (to)/from other reserves (5,997) (503)
5,000		 1,500 -
Surplus in year 16,897 -
-		 - 16,897
———— ————
————		 ———— ————
At 31 March 2023 370,925 20,049
34,093		 50,027 475,094
———— ————
————		 ———— ————

The notes on pages 13 to 23 form part of these Financial Statements.

11

Statement of Cash Flows For the year ended 31 March 2023

Cash flow from operating activities
Operating surplus for the year
Depreciation of tangible fixed assets
Amortisation of capital grant
(Increase) / decrease in trade and other debtors
(Decrease) / Increase in trade and other creditors
Cash flow from investing activities
Purchase of tangible fixed assets
Purchase of investments
Interest received
Cash flow from investing activities
Interest paid
Repayment of borrowings
Net change in cash and cash equivalents
Cash and cash equivalents at 1 April
Cash and cash equivalents at 31 March
Analysis of cash and cash equivalents
Cash in hand
Monies on deposit
Total cash and cash equivalents		 2023
2022
£
£
13,908
31,958
13,365
13,785
(6,243)
(6,243)
9,033
(5,442)
6,211
(12,056)
————
————
36,274
22,002
(16,274)
(4,000)
(1,000)
(1,000)
3,605
59
————
————
22,605
17,061
-
-
-
-
————
————
22,605
17,061
~~————~~
~~————~~
179,401
162,340
202,006
179,401
————
————
22,605
17,061
~~————~~
~~————~~
446
446
201,560
178,955
————
————
202,006
179,401
~~————~~
~~————~~

The notes on pages 13 to 23 form part of these Financial Statements.

12

Notes forming part of the Financial Statements For the year ended 31 March 2023

1(a) Accounting policies

General Information

The Charity provides housing to elderly people. The Charity is a public benefit entity and is registered with both the Regulator of Social Housing – registration number A3714 and the Charities Commission in the United Kingdom - registration number is 210463. The registered office is The Heals Building Suites, A & B 3rd floor, 22 – 24 Torrington Place, London, WC1E 7HJ.

The Financial Statements have been prepared in accordance with Financial Reporting Standard 102 – the financial reporting standard applicable in the UK and Republic of Ireland (FRS102), the Statement of Recommended Practice: Accounting by Registered Social Landlords Update 2018 (SORP), the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2019.

Basis of accounting

The Financial Statements are prepared on the historic cost and accruals basis of accounting, as modified to include the fair value of financial instruments and on the basis of going concern. The Financial Statements are presented in Sterling (£).

The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these Financial Statements.

Employees

The Charity has minimal employees as revealed in Note 4. The administration of the Charity is undertaken by employees of Anchor.

Going concern

The Charity’s business activities and factors that are likely to affect its plans for future periods are set out in the Strategic Report. The Charity has in place adequate unrestricted reserves and resources to fund its financial obligations as they fall due and its day to day operations.

On this basis, the Corporate Trustee has a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future, being a period of at least twelve months after the date on which the report and Financial Statements are signed. For this reason, the Charity has adopted the going concern basis in preparing its Financial Statements.

Turnover

Turnover represents rental income from licensees and service charges receivable and turnover is recognised when the Charity is entitled to it. Rental income and service charges receivable are shown net of voids. Void losses are only recognised where the properties are available for letting.

13

Notes forming part of the Financial Statements For the year ended 31 March 2023

1(a) Accounting policies (continued)

Revaluation of current asset investments

Current assets investments are stated at market value. Any unrealised surplus or deficit arising on revaluation of the investments is recognised in the statement of comprehensive income. The aggregate realised surplus or deficit arising on the sale of investments is reflected in the statement of comprehensive income.

Designated reserves

The Charity sets aside a reserve for building repairs and maintenance in accordance with a planned programme of work. This includes external painting, re-painting, repairs and internal decoration of common parts and the estate manager’s accommodation.

Fixed assets

Fixed assets are stated using the cost model at cost less cumulative depreciation less impairment. Fixed assets include housing properties held for social benefit purposes and scheme equipment.

Housing properties are principally properties available for rent. Housing properties are stated at cost less accumulated depreciation and impairment. Where housing properties are acquired from third parties the cost is their purchase price together with any costs of acquisition, improvement and interest payable.

Subsequent expenditure to housing properties

Works to existing properties which replace a component that has been identified separately for depreciation purposes, along with those works that result in enhancing the economic benefits of the properties, are capitalised as improvements. Where a component is replaced the cost and related depreciation are eliminated from tangible fixed assets. Economic benefits are enhanced if work performed results in an increase in rental income, a reduction in future maintenance costs or a significant extension to the useful economic life of a property. Shared ownership properties are split between current and non-current assets based on the anticipated proportion to be a first tranche sale with the first tranche proportion recognised as a current asset.

Scheme equipment is shown at cost less cumulative depreciation.

Housing properties are stated at cost less cumulative depreciation.

Depreciation

Freehold land is not depreciated.

Under FRS102, housing properties are required to be depreciated from the latest of completion date and acquisition date. The Charity has elected to depreciate historic cost over a period of 50 years from the applicable date.

Using component costing principles housing properties are divided into components which are depreciated at the following annual rates:

Component Life (Years) Depreciation
Building structure, roofing, drainage, roadways and footpaths 50 2.0%
Doors and windows 30 3.3%
Kitchens and bathrooms 25 4.0%
Heating boilers 15 6.6%

Scheme equipment is depreciated at varying annual rates as follows:

Component Life (Years) Depreciation
Lifts cars 30 3.3%
Security, heating, aerials and communal kitchen equipment 20 5.0%
Warden alarm, door entry and lift motors 15 6.6%
Other shared areas 10 10.0%
Other scheme equipment 4 25.0%

14

Notes forming part of the Financial Statements For the year ended 31 March 2023

1(a) Accounting policies (continued)

Social Housing Grant

Social Housing Grant (SHG) is a capital grant made to the Charity towards the cost of acquiring and/or building housing for rent or sale. Under shared ownership arrangements, Social Housing Grant is received from Homes and Communities Agency (HCA) and the Greater London Authority (GLA) on a basis related to cost but varying according to area and type of scheme.

Social Housing Grant is included in Creditors: amounts falling due after more than one year in the Statement of Financial Position and is amortised annually to the Statement of Comprehensive Income over the expected useful lives of the assets to which they relate or in periods in which the related costs are incurred. The accumulated amortised government grants represent contingent liabilities and materialises when the relevant property to which the amortised grant ceases to be used for social housing purposes usually due to disposal of the housing asset.

Social Housing Grants are accounted for as deferred income and as a liability due within one year and after more than one year. The income is recognised through the statement of comprehensive income over the life of the building structure for which it was received.

Financial instruments - Basic financial instruments

Trade and other debtors / creditors

Trade and other debtors / creditors are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses in the case of trade debtors.

In line with FRS 102 section 34; the Charity as a public benefit entity, has accounted for as concessionary loans all debtors or creditors that would have been classified as financing transactions such as deferred payment arrangement and are therefore being carried in the Statement of Financial Position at amortised cost.

Concessionary loans are financing arrangements between a public benefit entity such as the Charity and another party at nil percent or at below market rate of interest that are not repayable on demand and are for the purposes of furthering the objectives of the public benefit entity.

Short-term investments

Investments made by the Charity are a combination of short term bank deposits and fund investments managed by specialist managers and provided for non profit investors.

The short term bank deposits are classified as basic and recognised at amortised cost using an effective interest rate.

The fund investments are classified as complex instruments and recognised at market value. Market value is based on a publicly available price. Gains and losses on revaluation of fund investments are included in the Statement of Comprehensive Income.

Impairment of debtors

Provision is made for the impairment of current rent debtors when the debt is overdue by 90 days or more. The provision is for 100% of the amount overdue. Provision for the debts of former tenants is provided at 100%.

Sales ledger debts aged 3-5 months are provided at 10% of the amount due. Those more than 6 months old are provided at 25%. After this time a decision will be made concerning the write-off of the debt.

Other long-term creditors

Other long-term creditors include the costs of arranging long-term funding and premiums received on the issue of bonds. These amounts are amortised over the period of the underlying financial instrument. Also included in Other long-term creditors is the unamortised element of the social housing grant less an amount due for amortisation in the following year.

15

Notes forming part of the Financial Statements For the year ended 31 March 2023

1(a) Accounting policies (continued)

Financial instruments - Basic financial instruments (continued)

Cash and cash equivalents

Cash and cash equivalents comprise of cash balances and short term investments, which can be liquidated at short notice with no loss of capital. Bank overdrafts that are repayable on demand and form an integral part of the Charity’s cash management are included as a component of cash and cash equivalents for the purpose of the cash flow statement.

1(b) Judgements and Accounting estimates

The preparation of the Financial Statements requires trustees to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities at the reporting date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements and estimates have had the most significant effect on amounts recognised in the Financial Statements;

Classification of housing properties

The Trust has undertaken a detailed review of the intended use of all housing properties. In determining the intended use, the Trust has considered if the asset is held for social benefit or to earn commercial rentals. The Trust determined that its housing portfolio is held for social benefit purposes and is therefore accounted under FRS 102 section 17.

Provision for bad and doubtful debts

Provisions for bad and doubtful debts are calculated based on average collection rate by amount overdue. The Trustee makes judgements about the recoverability of debtors and the bad debt provision rate to apply to each specific debtor based on recoverability risk of the debtor.

Determining whether a debt instrument satisfies the requirement to be treated as basic

Judgement is required to determine whether a debt instrument satisfies the requirements in FRS 102 Paragraph 11.9 to be treated as basic. For debt instruments to be classified as basic financial instruments the interest must be a positive amount or positive rate, at market rates. They should not be index linked excluding RPI and the lender cannot unilaterally amend interest rates. Debt instruments are utilised to provide long term funding for the Charity’s operations and not for speculative trading. Facilities with two-way break clauses are judged to be basic.

16

Notes forming part of the Financial Statements For the year ended 31 March 2023

2 Particulars of turnover, operating costs and operating surplus

2023
Operating Operating
Turnover costs surplus
£ £ £
Social housing activities:
Housing accommodation (see note 3) 54,544 (46,879) 7,665
Amortisation of capital grant 6,243 - 6,243
———— ———— ————
60,787
~~————~~		 (46,879)
~~————~~		 13,908
~~————~~
2022
Operating Operating
Turnover costs surplus
£ £ £
Social housing activities:
Housing accommodation (see note 3) 61,248 (35,533) 25,715
Amortisation of capital grant 6,243 - 6,243
———— ———— ————
67,491
~~————~~		 (35,533)
~~————~~		 31,958
~~————~~
3
Particulars of income and expenditure from social housing lettings
2023 2022
£ £
Income from lettings
Rent receivable net of identifiable service charges and rent
losses from voids 44,231 55,264
Service charge income 10,313 5,984
———— ————
Turnover from social housing lettings 54,544 61,248
Expenditure on letting activities
Service charge costs (10,313) (9,278)
Management (13,572) (5,009)
Bad debts written off and movement in provision (251) 1,875
Routine maintenance (9,248) (8,881)
Major repairs expenditure - (210)
Depreciation of housing properties (12,862) (13,282)
Other costs (633) (748)
———— ————
Operating costs on social housing lettings (46,879)
~~————~~		 (35,533)
~~————~~
Operating surplus on social housing lettings 7,665
~~————~~
25,715
~~————~~
Rent losses from voids (13,387)
~~————~~
(480)
~~————~~

No segmental analysis is shown for housing accommodation as the Charity owns and manages only general needs accommodation.

17

Notes forming part of the Financial Statements For the year ended 31 March 2023

4 Employee information

Estate Manager
Average number of employees expressed as
Full time equivalent
Staff costs (for the above person)
Wages and salaries
Social security costs
Pension costs
5
Interest receivable and similar income
Other interest
6
Interest payable and similar income
On bank loans and other loans
7
Surplus on ordinary activities
Surplus on ordinary activities is stated after charging:
Depreciation of fixed assets


2023
2022
Number
Number
1
1
————
————
-
-
————
————
3,520
3,434
233
211
211
206
————
————
3,964
3,851
~~————~~
~~————~~
2023
2022
£
£
3,605
59
————
————
3,605
59
~~————~~
~~————~~
2023
2022
£
£
-
-
~~————~~
~~————~~
2023
2022
£
£
13,365
13,785

The Trust's audit fee for 2023 of £1,571 is paid by Anchor and recharged as part of Management Fee (2022: £1,333)

18

Notes forming part of the Financial Statements For the year ended 31 March 2023

8 Taxation

No provision for UK taxation has been made as all income and gains are used exclusively for charitable purposes and are therefore exempt from taxation.

9 Surplus on revaluation of current asset investments

(Deficit)/Surplus on revaluation of current asset investments 2023
2022
£
£
(616)
14,841
~~————~~
~~————~~

The Charity was established in the late nineteenth century. There is no record of the original cost of the almshouses and no value is attributed thereto. Freehold housing properties detailed above relate to improvements carried out since 1988, which were partly funded by a Homes England Grant of £312,144 and a Residual Mortgage Loan repayable over thirty years. The balance was provided from the Charity’s own resources.

10 Tangible fixed assets

Tangible fixed assets
Freehold Scheme
housing equipment
properties Total
£ £ £
Cost
At 1 April 2022 514,105 11,213 525,318
Additions 16,274 - 16,274
Disposals - - -
———— ———— ————
At 31 March 2023 530,379
~~————~~		 11,213
~~————~~		 541,592
~~————~~
Depreciation
At 1 April 2022 (180,913) (6,983) (187,896)
Charge for the year (12,862) (503) (13,365)
Disposals - - -
———— ———— ————
At 31 March 2023 (193,775)
~~————~~		 (7,486)
~~————~~		 (201,261)
~~————~~
Net book value
At 31 March 2023 336,604
~~————~~		 3,727
~~————~~		 340,331
~~————~~
At 31 March 2022
333,192
~~————~~		 4,230
~~————~~
337,422
~~————~~

19

Notes forming part of the Financial Statements For the year ended 31 March 2023

11 Debtors

Amounts receivable within one year:
Rent and service charge arrears
Less: bad debt provision
Amounts receivable after more than one year:
Anchor Hanover Group
Other debtors, prepayments and accrued income
Current asset investments
Short term deposits
Listed investments at market value:
-
Charity Multi Asset Fund
-
COIF
Value at 31 March
Cost of listed investments (Charity Multi Asset Fund)
Cost of listed investments (COIF)
Analysis of movement of listed investments
Value at 1 April
Additions at cost
Net surplus on revaluation
Value 31 March		 2023
2022
£
£
444
63
(275)
(24)
————
————
169
39
-
10,015
852
-
————
————
1,021
10,054
~~————~~
~~————~~
2023
2022
£
£
201,560
178,955
34,464
33,086
110,664
111,659
————
————
346,688
323,700
~~————~~
~~————~~
27,529
26,529
~~————~~
~~————~~
24,935
24,935
~~————~~
~~————~~
2023
2022
£
£
144,553
128,712
1,000
1,000
(424)
14,841
————
————
145,129
144,553
~~————~~
~~————~~

12 Current asset investments

The Charity holds income shares in the National Association of Almshouses Common Investment Fund purchased prior to 1970 held at current value with no original cost ascribed.

20

Notes forming part of the Financial Statements For the year ended 31 March 2023

13 Creditors: amounts falling due within one year

Rents and service charges received in advance
Anchor Hanover Group
Service charge surpluses
Other creditors, accruals and deferred income
Deferred grant income		 2023
2022
£
£
775
1,107
5,211
-
807
251
13,071
11,489
6,243
6,243
————
————
26,107
19,090
~~————~~
~~————~~

14 Creditors: amounts falling due after more than one year

Service charge surpluses
Deferred grant income		 2023
2022
£
£
-
807
187,285
193,528
————
————
187,285
194,335
~~————~~
~~————~~

15 Capital commitments

The Charity had no capital commitments at 31 March 2023 (2022: Nil).

16 Contingent liabilities

The Board of the Corporate trust is not aware of any contingent liabilities (2022: Nil).

21

Notes forming part of the Financial Statements For the year ended 31 March 2023

17 Related party transactions

Anchor Hanover Group, the Corporate Trustee, also acts as the managing agent for the Trust providing various services for which fees are paid as follows:

Management fees
Service charge and technical services fees
Alarm and alarm monitoring services		 2023
2022
£
£
10,268
4,527
2,187
842
587
492
————
————
13,042
5,861
~~————~~
~~————~~

As part of the arrangement Anchor Hanover Group also provides short term funding and cash management for the day to day operations of the Trust and the amount outstanding at 31 March is as follows:-

Amounts owing (from)/to Anchor Hanover Group 2023
2022
£
£
5,211
(10,015)
~~————~~
~~————~~

18 Legislative provisions

The Charity is an unincorporated charity registered with the Charity Commission.

19 Payments to creditors

The Charity’s policy is to pay all invoices within 28 days or in accordance with agreed terms.

22

Notes forming part of the Financial Statements For the year ended 31 March 2023

20 Deferred grant income

Income
Balance 1stApril
Balance 31stMarch
Amortisation 1stApril
In year
Total amortisation
Net value of grant
Amounts due < 1 year
Amounts due > 1 year		 2023
2022
£
£
312,144
312,144
————
————
312,144
312,144
112,373
106,130
6,243
6,243
————
————
118,616
112,373
————
————
193,528
199,771
~~————~~
~~————~~
6,243
6,243
187,285
193,528
————
————
193,528
199,771
~~————~~
~~————~~

23