Trustees, Annual Report and Accounts for year ended 31 December 2020 Company number: 323575 Registered charity: 211585 www.physoc.org
The Physiological Annual Report and Accounts Company No. 323575 Contents Introduction Irom Presh4enrand Chief ExecuiNe Report oftheTrustee5 Charitable obiects3ndwbli¢ behefft Strate8icaims and performance siru¢ture, 8o¥emance•nd Mana8tnt Siinins ol rewrt independent avdil(Vsreport 51aternentof financ1 actryitse5 St4terneDt of cash IILr4s A¢c¢vThiirt8 p¢licles Note5 to the Iinancial statements Inwme from charitèb acti¢ Incomefrom in¥estmentS Analwsolexpendituie ADI150f supportaDd80s*rTranee<05ts Anal$01 8rants Related partytrnnsadi¢Jns Investment property 7.LO Investments 7.11 Debtors 7.L2 Creditor5 7.13 Deferred incame 7.14 Anal$01 net lunds Reconciliation of net MotMent infundstonet tashfiow fvomoForatinRartlts Ana150f cash and ca5hequwalenrs Comparatlve SoFApei FRS 102 ISORP20151 514nding InlDTm?tyon 7.15 7.16 7.17
The Physiological Annual Report and Accounts 1.1 Report of the Trustees The Trustees are pleased to submit this report and the financial statements for the year ended 31 December 2020. Thi5 15 the Trustee5' Annual Report and Accounts for the year ended 31 December 2020 for The Physiological Sotiety I'The Society"). In preparing this report, the Trustees have complied with the Charities Att 2011, the Companies Act 2006, the Articles of A550ciation I"Articles-I, and Accounting and Reporting by Charities.. Statement of Retommended Practice applicable to tharities preparing their atcounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021. The Society was incorporated by guarantee on 27 January 1937 under number 323575. It has no share capital and is registered with the Charity Commission for England and Wales under number 211585. The liability of each member is limited to £1. The governing document is the Articles of the Company. and the members of the 8oard of Trustees 1.the Board") are the Directors of the Company. he Physiological Society~ and The Physiolo8ical Society logo are tra(Jemarks belon8ln8 to The Society and are reglstered in the UK and in the EU, respectively. The Society also produces an Impact Report which features further information on the activities of The Society, including reports and case studies which demonstrate the impact of our work over 2020. The Impact Report can be obtained from the registered office, Hodgkin Huxley House, or online from www.physoc.or8. Trustees, responsibilities The Trustees, as Directors of the charitable company. are responsible for preparin8 the Trustees, Report and the financial statements in accordance with applicable law and regulations. Company law requires the Trustees to prepare financial statements for each financial year. Under that law, the Trustees have elected to prepare the financial statements in accord3n¢e with United Kingdom Generally Accepted Accountlng Practice (United Kingdom Accountin8 Standards and applicable13wl. Under company law, the Trustees 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 Society and the income and expenditure for that year. In preparing these financial statements, the Trustees are required to.. select suitable accounting policies and then apply them consistently; observe the method5 and principles in the Charities Statements of Recommended Practice; make judgement5 and accovnting estimates that are reasonable and prudent; prepare the financial statements on the Éoing con¢em basis unless it is inappropriate to presume that the company will continue in business.. state whether applicable UK Accounting Standards have been followed. subject to any material departures disclosed and explained in the financial statements. The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain The Society's transattions and disclose with reasonable accuracy at any time the financial position of The Society 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 Society and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Trustees have tonfirmed that as far as they are aware at the time the report is approved. there is no relevant audit information of which The Society's auditors are unaware. They have taken all steps necessary to make themselves aware of any relevant audit information and to establish that The Socievs auditors are aware of that information.
The Physiological Annual Report and Accounts 1.2 Financial Highlights Our principal funding sources were from publications- £4,023.00012019: £4,094,000), events- £3,000 {2019: £159.0001, membership - £61,00012019: £153,000) and investments and investment property- £365,000 (2019: £397,000). Overview of the year Charitable expenditure of £3,565,00012019.. £4,656,0001 wa5 incurred during the year and ha5 SUPPOrted our charitable obje¢ts as set out in the statement of financial activities on page 25 of this report. Publishing income190% of total income) fell slightly by £71,C(Q11.7%1. Events income in 2020 decreased by £156.OCQ. from £159.(W in 2019 which included Physiology 2019. The Society's first 'solo' Annual Conference for a number of years. The impact of the COVID-19 pandemic led to the cancellation and delay of The Societ¢s portfolio of events as face-to-face meeting5 were not POS5ible. Membership income recognised in the period fell from £I53.oC to £61.000 as a result of a decision to spread the income across the period of membership. this is a one off accounting adjustment. Investment fund income, which is all reinvested, fell slightly by £31,C(O116%1. Rental income associated with the rental of space in Hodgkin Huxley House held static at £204,000 compared to £205,OCQ in 2019. To help safe8uard the property asset, £500,CQO has been des18nated to reflect the ten-year building maintenance programme. The impact of COVID-19 led to the postponement of a number of costs, external and internal meetings, travel grants, public engagement activities and policy and communication activities were all impacted with an overall reductlon In Charitable spend of £1,091,0 over the prior period. The impact of these costs not occurrin8 tO8eiher with the relative strength of publishing in a pandemlc year and other income has led to an operatin8 surplus of £865.OCQ compared to £122.000 in the prior year. The surplus has arisen because of the impact of the COVID-19 pandemic on the planned expenditure for the year and the Trustees have therefore designated the total surplus for the year to a COVID-19 fund. Investment performance Following the net gain of £972,000 from the investment portfolio in 2019 the current turbulent year ended up returnin8 a £464,000 gain representing a 5.9% return. The cash held on 190-day deposit matured towards the year end and was held within cash at the balance sheet date. As a result of this change oftset by the gain for the vear the total value of listed investments and cash held within the portfolio decreased from £9,9S7,000 to £9,524,IX)O. As a result of the pandemic The Society has reviewed the carrying value of the portion of Hodgkin Huxley House held for investment purposes and based on local evidence have reduced the carrying value by £514,000 as at 31 December 2020, to reflect both the uncertainty in the commercial property market and subdued demand as at that date. The Society's investment policy. which takes into account the underlying investment in Hodgkin Huxley House. is to achieve long-term capital growth which can ultimately provide a significant income Stream, regardless of fluctuations in our publishing income, to support key charitable activities.
The Physiological Annual Report and Accounts The long-term investment target is inflation, as measured by Consumer Price Index ICPII, plus 4%. A composite benchmark, across three asset classes, is used in the quarterly valuations. In 2020, the manaÈed portfolio returned a gain of 5.9% while the inflation target ICPI + 4.0%) amounted to a @ain of 4.S%. The composite benchmark returned a gain of 5.9% for the same period. The Society invests in collective investments (unit and investment trusts). This is designed to give a protective broad level of diversification across all major asset classes. Cazenove Capital Management ICCMI. our fund managers. have general discretion over the asset allocation and selection of investments within pre-agreed investment parameters as set out in our Investment Policy Statement. In 2021 The Society engaged consultants PWC to develop a new Investment Poliry Statement IIPSI which better supports The Society's goals including incorporating a more robust Responsible Investment Policy statement. as well as review potential fund managers, which would inclLbde the incumbent, to mana8e The Society's portfolio under the new IPS. Reservps Policv The society's current ReseNe Policy is a risk based policy that will help to achieve The Societvs objectives, as set out in the 2018- 2022 Strategy. This risk-based policy was developed by the Finance Committee following an escalation of The Society's publishing income risk and also following updated guidance from the Charitv Commission, which require5 the Reserves Policy to be clearly laid out with strong justifications on why the stated reserves are needed. The new policy balances the need to hold back reserves to mitigate the publishing income risk but also signals intentions to fulfil charitable objects for current beneficiaries le.8. strategic projects). In addition, a proportion of the funds have been set aside for sustainability and income diversification initiatives. The major exposure in The Society's income portfolio is its dependence on publishing income, which represents around 90% of annual iurnover. The hiBh commitment to expenditure allied to substantial exposure to a single sourte of income is a major risk to the organi5ation. The Society has designated a Continuity Fund1£5.6ml to mitigate this risk and provide medium-term stability. The Continuity Fund ensures sufficient time to transition to alternative operating models, in an orderly fashion, shoul¢J publishing income collapse. The Continuity Fund represent$ 24 months operatin8 costs ex¢lvdin8 publishing, grants expenditure and one-off costs. These are around 40% staff costs that cannot be immediately adjusted in a new operating environment. The Society has further designated a HHH Property Fund1£4.823.c((Jl comprising the current carrying value of The Society's freehold property in London. currently split between tangible fixed assets (held at depreciated costl and investment property Iheld at market value). and as such it is not available to meet the general running costs of The Society. As well as non-property fixed assets. £0.5m has been designated to an HHH Maintenance Fund to recognise essential future spending associated with the maintenance of the freehold property. The Strategic Investment Fund will be allocated to new activities and specific major projects Specified in the 2018- 22 Strategic Plan, for example, an Innovation Fund to support sustainability and income diversification, for which a sum of £l,l(X),000 ha5 been de518nated. COVID-19 Fund As reported above The Society has designated the surplus arising in 2020 of £865.CN)O into a specific COVID-19 fund.. to acknowledge the one-off nature of these monies and the need to fund a number of delayed activities into the future to raise the visibility of The Society and the discipline,. to support any shortFall in incorne from publications due to the uncertain landscape,. to tover the costs of external tonsultanty 5UPPOrt where spÈtiali5t knowledge, expertise and independent professional opinion is required. for example to build membership engagement and numbers alongside and increasing inclusion and diversity across The Societies activities..
The Physiological Annual Report and Accounts to provide 5UPPOrt for hybrid conference5 which by their nature are more re50urce intensive to run wtth a physical venue and a virtual platform whith is essentially another venue which must be paid for alongside additional production and staffing costs. The Society hold5 the balance of reserves to ensure it can meet its operational need5 and working capital requirements (the free reserve). The free reserve aims to hold approximately six months operating costs, currently £1.8m excluding third party operating costs and grants. to provide operational cash flow. At 31 December free reserves held totalled £3,497,CIJO, however since the Balance Sheet date the growing uncertainty in the academic publication sector means there is likely to be an ongoing redurtion in income and these available reserves may need to be utilised. Frnnk 5engplel Honorory Treasurer
The Physiological Annual Report and Accounts Objective Activity Perlormancelimpact Building the community Our Editorial Board Fellowship scheme, which invites early-c3reer- stage physiologists to apply to join the Editorial Board of IP under the mentorship of a Senior Editor. continued to attract many outstanding applications. Out of 63 applications in 2020, eight new Fellows were appointed. Four of the original cohort of Fellows (from 20181 proved to be of such a high calibre that they were appointed as Reviewing Editors. In order to Promote wide readership and signal our interest in attractinB submissions from more Countrie5 worldwide, we hosted webinars in with local Editors in Chin3 and Brazil, with translations of key messages in the attendees. native language. Both JP and EP appointed new Editors in China. Board appointments have also been made in currently under-represented countrie5 including Germany and Hungary. In order to engage more junior We hosted nine VJC webinars in 2020 readers of JP. in 2020 we embarked land already have our calendar full for on a new scheme called the 'Virtual 20211 and a had good number of Journal Club, IVICI. which invited attendees participating in discussions. eligible hosts to present their review of a recent research article of interest published in the journal to a wide audience. Improved quality of submissions from these countries. Developing the brands In 2020 JP introduced a new service Clear, professional and journal- for authors- access to our branded schematic figures in article5, premium BioRender account that which, when shared and re-used enables authors to create visually promote JP'S brand and commitment appealing and scientifically accurate to authors by offering this service. schematic figures. EP introduced a new feature. EPicks. These short11-2 minl researcher-led videos celebrate our authors, research. The videos are usually from the junior author on the paper. They help build author loyalty and increase accessibility of research to the wider community.
The Physiological Annual Report and Accounts Raising the bar for scientific integrity EP introduced 3 new article type called Registered Reports. In these. a research question and proposed methods are evaluated for suitability prior to any data being collected. The Registered Reports scheme helps authors refine experimental design and data analysi5. reduces publication bias and improves reporting of results, irrespective of the outcome of the study. The first protocol submission has been reviewed and published. Transition to Open Access JP and EP are part of Wile5 new read-and-publi5h deal with li5C, covering authors in UK HEIS. With the Jisc deal, IP and EP are compliant with Plan S (which took effert on 1st January 20201 in the countrie5 where the cOAlition S funders are active. This is in line with the objective of complying with or exceed funders. OA mandates. Phys Rep was born OA. Future Plans- 2021 and beyond Adoption of Open Sclence Ba¢Jges scheme. Roll out of new EP statistics policy Publishing peer review reports. Improved IFAS to guide authors, writing Style for better communication of research. Introduction of abstract figures for JP research articles. Conferences Advancin8 physio108y through our conferen¢es.' excellent science, wide and artive participation, lastin8 impact Researchers go to scientific conferences to present new work and get feedback on it from their peers, to make connections with other 5cient15ts, to learn about new research, technique5 and ideas, and to catch up with friends and colleague5. Conferences also have a role in setting the dirertion of research, particularly by highlighting hot topics. Through its programme of meetings, The Society showca5e5 phy5ioIo8ical research, spotlights new areas of discovery, delivers training for early career re5earcher5 and provides an opportunity for phy5ioI0815t5 to interact. 2020 felt like a watershed year for academic conferences. With travel restricted and venues closed f¥om March onwards, the Trustees made an ear decision not to hold in-person events for the rest of 2020. Having a clear-cut decision allowed the Events team to= Mitigate the financial loss through cancellation of bookings; To postpone meetings and individval symposia to 2021 and 2022,. To avoid reputational damage to The Society through leaving would-be attendees in limbo and to focus on how we might replace the 2020 programme. The Society's strategy for 2018-21 referred to-a prediction that rising travel co%t% and the advent of sotial-media communities would signal the end of the academic conference~. When the pandemic struck the Events team was io
The Physiological Annual Report and Accounts Objettive Activity | Pertomiancelimpact 'excellent' and all 5Bid they wotjld recornmend the club to 3 colleague, collaborator, or peer. on webinars arhd with membership on the 2020 Member Forum. We also hosted Wariability.. How to Deal with It, Interpret It, and Learn from It, where the attendance wa5 231. Ensure evaluation Online allows easy collection of digital is ernbedded into data on user behaviour. our programme5 Being able to collect data on user behaviour is invaluable in informing and refining plans for future online conferences. Networking meetings after the Virtual Journal Club meetings were implemented following attendee feedback. The activities in 2020 have demonstrated the importance of maintaining audience engagement for online conferences and this is a priority for 2021, particularly gamification. Introduce more audience participation With the switch to online we have seen a surge of innovation in software enabling hosting of conferences. including real-time interaction between speakers, chairs. and audience. Manv platforms offer gamification which awards points based on an attendee's behaviour eg for watching a talk. asking questions etc. AII 2020 meetings were in a new style. The impact of the 2020 online conferences and The virtual 2-day meeting on variability webinars means that going forward they will be an will be followed up by an in-person one- important addition to The Society's meetings day workshop. calendar. Online events have low fixed costs, a Having successfully delivered online events means near-zero marginal cost ol attendance that they will play a role in our plannin8 either as a and involve no travel. Althou8h most of stand-alone event or as part of a hybrid event which the virtual events were free, there was would have an in person and virtual component. a small ¢har8e for non-members to attend the Variability.. How to Deal with It, Interpret It, and Learn from It webinars. The Events team is exploring registration charges for hybrid events. Online frees event5 from geographical ¢onstraint5 Other than tiffle zone5 afbd differences in access to technologv. Research opportunities for new styles of meeting Agree a sustainable business model lor our meetin85 programme Ensure there is Beographical spread to the meetings we deliver We have seen a significant increase in the number of countrie5 attending our events. For example, 18 countries attended Future Physiology 2019 in Liverpool and 36 countries attended Future Physiology in 2020. With much of the 2020 and 2021 programme postponed to 2022. the impact of this is yet to be seen. Review the roles of the Theme Leads and Meetings Committee to ensure that we are using the right group to Some of the Theme Leads were involved in arrangin& and promotin& a well-attended series of Theme-based webinars. including 12 of the physiology of obesity. A new team of Early Career Theme Leads was enlisted in late 2020 and quickly played an important part in organising Future Physiology 2021. 12
The Physiological Annual Report and Accounts Objective decide on Four new member5 were recruited to programmes and Conferentes Committee to replace content positions and improve diversity. Activity | Perlormancelimp3ct Engagement Engage for success- improving our two-way commitment and communication to increase recognition of the importance of physiology The goal of the engagement strategy is to increase awareness of physiology in order to strengthen the pipeline of physiologists across the discipline. The successful achievement of this goal will be measured by an increase in The Society's membership numbers and the number of engaged members. As part of an agile response to the pandemic. The Society adapted its activities and resources to support members livlng and working in unprecedented circumstances. The Society consolidated existing resources and built new ones to respond quickly to the ch3n8in8 landscape. The ~COVID-19 Hub" was launched as a go-to area on the website to make it easy for members to access and keep up to date on all the activities to support them. Beyond our response to the pandemic. we continued to work on strengthening The Society through building our support and activities committed to increase diversity and inclusion within physiology. Our communications activity engaged our strategic target audiences. responding to the COVID-19 pandemic by, for example, producing a series of rapid response information videos to inform the public about physiological aspects of the disease. Our policy work enBaBed key stakeholders to raise the visibility of physio108y among funders, higher education institutions, public health organisations and policymakers. Objective Performance/imp3ct Increasing the level of The Society completed a review of its The Impact of the new membership categories engagement of our membership categories with a view of will take time to emerge. but the categories members and the increasing the accessibility of complement our diversity and inclusion work to number delivering membership to all those working within increase access to non-academic physiologists. engagement activities physiology- whether within or outside of Movin8 to an online format enabled The Society academia. to run webinars to support a range of communities within our membership le.g. those that are teathing, underÈraduates, or early career researchers). We worked with our members to identify and deliver webinars and reSourS appropriate for the environment and audience. Throughout the pandemic The Society ran three programmes of professional development and support webinars that were co-created with members. 13
Annual Report and Accounts The Physiological Objective Activities Perfomiance/impact Increasing the number of young people choosing to study physiology-based courses through traditional routes and emerging educational options. In 2020. 20 undergraduate members were awarded a summer studentship,. this scheme provides undergraduates with funding to undertake an 8-week research project in the lab of a member. The summer studentship provides an importhnt opportunity for students to validate or inform their plans for a researth tareer in physiologv. Of the 20 students awarded, not all were able to take up their funding in 2020 and The Society was flexible with the option to defer funding until 2021. In 2020, The Society launched a competition aimed to increase the take up of higher education in physio108y called "Aspiring Black Physiologists" Aspiring Black Physiologists provides funding for members to go into schools to highlight Black physiologist5 that worked or are working within physiology. The competition is for Black students to write about their own experiences or the experience5/wtsrk of Black physiolo8lSts that have gone before them. The physiology curriculum has been accepted bv the GMC into the undergraduate medical curriculum, thereby increase the visibility of physiology amon8 clinician5 and improving the physiology education medicèl students receive. Developing a policy and funding environment favourable to physio108y We carried out three significant policy projects.. lil producing a physiology curriculum for medical students,. lill explored physio108y's contribution to keeping older people healthy during the COVID-19 pandemic,. and liiil reviewed the sc3le of knowledge exchan8e activity undertaken by physiolo8lSts and how this can be increased. Our COVID-19 report was launched at a virtual meeting of the Parliamentary & S¢5entlflc Committee, and recommended a 'national resilience programme, and helped set the agenda at a political and public policy level. It established TPS role within public health. Our knowledge exchange project has established links with industry. funders and policymakers. as well as bolstering our member offering. and The Society is sector leading in this approach. Our public infom)ation videos were watched by 820,0(M) people, with the COVID-19 Hub on our website visited by almost S0,0(K) people. Increasing the understanding of physiology among our target audience and increase the visibility of physiological research in the media in particular, the importance of physiology to lifelong health In response to COVID-19 we launched a series of information31 videos with a physiologist explaining 3 key. timely aspect of the disease and the public health response to it. 14
Annual Report and Accounts The Physiological Objective Activities Perfomiance/impact Future Plans- 2021 and beyond In 2021. we will be working to intrease the engagement of our members and to attratt new members in the Full member category. We will be unveiling a series of Blue Plaques across the UK to recognise key historical figures in physiology- at each unveiling there will be a guest speaker and a series of short talks aljout Society membership. We will also be launching an online member community area to encourage networking and to add value to membership with additional member-only resources. Our policy plan for 2021 builds directly on our 2020 activities. with further projects focused on key areas required for the delivery of our strategic objectives. This will include a focus on improving the landscape for interdisciplinary research and analysing the impact of physio108V hi8her education. Internal processes Harnessing technology, working smarter. increasing transparency and improving performance to support delivery of the strategv Driving forward a successful strategy relies on appropriate and efficient systems and processes to underpin activity delivery. This includes infrastructure, financial planning, 8oveman¢e and administration. All our operational processes were adapted to the response to COVID-19 in 2020, which included the lockdown closures of Hodgkin Huxley House. The Society was well placed to facilitate all operational processes whilst staff worked fmm home throughout 2020. with all business-critical systems cloud based, providing accessibility to all systems. and facilitating meetings and collaboration throughout lockdown. All staff were provided with the necessary support and resources to operate a remote working situation. and The Society provided a successful programme of remote training for all staff. The Socie$ financial processes. which were in part paper based, were migrated to a new online payment processing and authorisation platform. and our 2020 audit was successfully concluded entirely remotelv. Whilst Hodgkin Huxley House was unoccupied during the highest level of COVID-19 restrictions, the building was made COVID-19 ready in accordance with the government's COVID-19 Risk A55essment Framework, allowing The Society to safely reopen the building to those staff and tenants struggling to work from home. Despite the c105ures and restrictions throughout 2020, Hodgkin Huxley House maintained full tenant rental income, and a small redLJCtion in service tharge intome and expenditure. Throughout 2020, the essential maintenance programme at Hodgkin Huxley House was maintained. 15
Annual Report and Accounts The Physiological 2020 saw the restrutturing of the Operations Team. The new structure is led by a new Head of Operations role, and incorporates a new Business & Operations Man3Èer role, and an uplift in the use of our outsourced finance partners lat both a director and administrative level). The Society was awarded the government's Cyber Essentials certification in 2020. This certification tests the security of our network. devices. software and platforms. to ensure the data we hold is as securely as possible. complementing our continued commitment to Data Protection regulations. Objective Performancelimpact During 2020, we reviewed and upgraded It has been beneficial during this period of our payroll system moving from paper homeworking and lockdown for staff to be payslips to online payslips. able to acce5S their payment profile online The review involved benchmarking systems and payslips. The impact can also be seen by used by other or8anisations, researching HR with the reduction in their time and the different providers, and seeking quotes costs associated with p05ta8e. The system nd online demonstrations from our also allows for HR to have more control and preferred options. transparency over what is entered into the system. Oeveloping the organisation and infrastructure Durin8 the previous year and the difficult clrcumstances, we maintained a full Feedback has shown staff have contlnued to programme of training for all staff. feel developed, supported, and included Adapting to the circumstances at this time, with our trainlng and team bulldln8 the training and workshops were held pro8rammes. virtually. The all-staff training focused particularly on ways of working such as building empathy. and the tools to provide managers and staff to be able to give and receive effective feedback. We also focused on diversity and inclusion. The Society continued to invest in staff specific learning and development programmes. Alongside the training and to support team buildin8 and bonding, we also held a virtual away day and social team building events. Our new Ways of Working Policy, adapted for homeworking lent itself to ensuring staff were supported while working remotely and gave svgge5tion5 and signposted resource5 to support good mental health. In 2019 the Finance Commtttee at their noted that The Society had been with the The Society will conduct its first audit with new auditor Buzzacott in 2021. 16
Annual Report and Accounts The Physiological Objettive Activities Performancelimpact Incumbent auditor5 for nearly 20 year5. It was felt that it would be good practice to rotate audit firms with some regularity. The following process was then approved for rotation of auditois. A full review and tender process every terh years. Incumbent auditors Can be reappointed annually by Council. subject to satisfactory performance, up to a maximum of ten years. partners to rotate after five years. In 2020 Finance Committee made a recommendation to the Board to the approve the new auditors who were selected to bring the right combination of qualifications, experience, techrl081eS and approach to the task. Developlng a hl8h- performance Board David Paterson stepped up as President in The Board ran smoothly in 2020 after the November 2020 and the David Attwell was 2019 adoption of the new 8overnance appointed by the Board as President-elect. structure and revised Articles and Lucy Green stepped up 35 the new Chair of Regulations. Good communlcation between the Education, Public Engagement and Trustees, the Chief Executive and the senlor Policy Committee IEPEPI. Daniel Brayson Management Team enabled The Society to was elected as first Early Career Trustee. be innovative and agile to navigate the Honorary Treasurer Frank Sengpiel agreed unforeseen disruptions due to COVID-19 to an extension of his role by a year to pandemic while continuing to deliver the provide stability during COVID-19 and strategy. The Board was able to run allow for a second round of recruitment. meetings effectively by Zoom and continued Catherine Hall was appointed as the to make important decisions and hold incominE Chair of Conferences and Paul insightful conversations. The transition to a McLouEhlin as the incominE Chair of new President and President-elect set the Publications Committee Iboth to take stage for a new post- COVID-19 strategy. The office in November 20211. appointment of an Early Career Trustee and new Chair of EPEP120201, and well as incoming Chairs of Conferences and Public3tions120211 ensured new skills and experience as well as fresh perspectives. The Task Force, chaired by a Trustee Champion for Diversity and Inclusion, includes representation from each of the Advisory Committee5. The Group lead5 work to ensure that the principles of diversity and Improving inclusion The Society established a Diversity and Inclusion Task Force in 2020. 17
Annual Report and Accounts The Physiological Objettive Pertormance/impart Inclusion are embedded across all Bctivitie5 and reports regularly to the Board. In 2020 we increased our quantitative EDI data to 18% of members. We have begun to analyse engagement in activities15uch as grants) in the context of this data. The next step will be to build qualitative data. The Society is building an evidence base for action towards increasing diversity and equality of opportunity. The Society launched a competition entitled -Aspiring Black Physiologists" to encourage 16-18 year old Black students to Funding 15 available for members to visit consider a career in physiology. schools lin person, or virtually) to highlight the work of physiologists- in particular Black physiologists- to encourage Black students to participate in the competition. Future plans- 2021 and beyond Maximising the building revenue potential. 2021 will see our tenant contract5 Teach their mutual break period, and an end of our current facilities management contract. In preparation of this, we will conduct a property review in 2021. The results of the property review will ensure that the buildin8 meeis the future requirements of The Society as a source of Income and also meets the needs of our activities. A recommendation on the optimum model will made to the Board via our Finance Committee during 2021. Utilising new technology platforms. 2021 will see the adoption of new platforms to better meet our requirements in expenses and grant management. risk and voting. together with the implementation of a new security software. Competencie5 and training.. 2021 will See a review of our competency framework. The competency indicator5 will be differentiated to reflects roles 3n(I responsibilities. They will be better able to help identify where more focused training is required. Alongside this development the Behavioural descriptors are now broader but continue to underpin The Societrfs value5. The Core/Essential Behavioural descriptors are.. 18
Annual Report and Accounts The Physiological Objective Activities Performancelimpact Fostering Teamwork Effective Communication Personal awareness Personal effectiveness Problem solving Job knowledge The SMT specrfic Behavioural descriptor5 are.. Partnership working Leadership 1.5 Structure, governance and management Board of Trustees The Trustees are ultimately responsible for the overall strategy, governance, management and Board policies of The Society, ensuring that the charitable objects for which it has been set up are met. The Trustees are also the Directors of the ¢ompany. The Board meets four times a year. Following a skills assessment ea¢h yeèr, any Sdentified vacancies on the Board are recruited followin8 the processes dictated in the Articles of Associatlon and Regulations. The normal length of service on the Board is four years. The current size of the 8oard is 13, including two independent Trustees and an Early Career Trustee. Board meeiings are chaired by the President. From 2021 the General DSrectors shall always Include in their number one person resi¢Jent Sn the Republlc of Ireland. Trustee induction and training On appointment new Trustees are provided with an induction pack which includes various information and resources such a5 the Charity Commission leaflet CC3, the governing documents and Board policies. They are also required to $18n a Trustee Code ol Conduct agreement and complete a Conflicts of Interest declaration survey. Trustees attend introductory meetin85 Wlth each member of the Senior Management Team to familiarise themselves with The Societies activities, strate8y, and priorities. In addition, all Trustees are encouraged to attend trainin8 courses, for example, those targeted for Trustees run by the Civil Society. Governance structure It is the Board of Trustees, collective responsibility to set the strategy to deliver The Society's charitable objects and to ensure the effective governance of the charity. The Board then in turn delegates details of the governance oversight and delivery of the strategy to a series of cofflmittees and smaller groups which report back to the Board quarterly. The three advi50ry committee5 are Conference5, Publication5 and Education, Public Affairs and Policy. Each Advisory committee has a Membership Champion at established career level,. an early career Membership Champion,. a Diversity and Inclusion Champion. Thi5 person may also be one of the two Membership Champions. The three governance committees are Finan. Nominations. and Remuneration. Further details regarding the governance of The Society including the Articles of Association. Regulations, Trustee Annual Reports and Board make-up can be found on the newly updated governance pages of The Societvs website. Managcmcnt and adniinistration The Society has approximately 30 staff and operates out of Hodgkin Huxley House, which was acquired in 2012. The Chief Executive is the senior executive of The Society appointed by the Board and 15 accountable to the Board 19
The Physiological through the Chair. The Board has delegated day to day responsibrlity for the operational decisrons and administration of The Society to the Chief Executwe to manage The Sociews actwitie5 for optimal performance, including the plans. setting balanced budgets. property and staffing and other resources of The Society in accordance with the strategic and budgetary parameters and risk management strategy. All decisions, apart from those delegated to the Chief Executive as set out in the Delegated Authority Framework, are made by the Board. Anything outside the approved Strategic Framework or Budget has to be approved by the 8oard. For the efficient and effective management and proper operation of The Society. the Chief Executive delegates at their discretion a number of their responsibilities to the Senior Management Team ISMTI and other employees. This further delegation of responsibilities does not release the Chief Executive from the overall responsibility which has been delegated to them by the Board. Key management personnel remuneration The key management personnel of The Society comprise the Board of Trustees, the Chief Executive and all other members of the SMT in charge of directing and controlling The Society 3nd running and operating The Society on a day-to-day basis. All Trustees give of their time freely. and no Trustee remuneration was paid in the year. Details of all Trustee expenses and related party transactions are disclosed in note 7.7 to the accounts. Trustee5 have a legal obligation under Charity Law to act in the best interests of The Society, in accordance with The Society's Articles, and to effectively manage situations where there may be a potential conflict of interest. The Society adopted a Conflicts of Interest policy in 2019 which details how to identify, manage and report conflicts of inierest. Trustees and SMT are required to disclose all relevant interests and re8lSter them with the Governance and Risk Manager and manage them in accordance with The Society's Conflicts of Interest Policv. Trustees complete an annual declaration of related party interests which infomis the Society's Register of Interests. The Articles of Association also include a sertion on Conflicts of interests and conflirt5 of loyalty which stipulate what Trustees must do when they arise. The pay of the Chief Executive is reviewed annually by the Remuneration Committee, and normally increased in aceordance with avera8e earnin8s to reflect 3 cost-of-living adjustment. In view of the nature of The Society, the remuneration 15 a150 benchmarked against similar membership or8ènisations in the sector and the relevant location, or with reference to sector reports to ensure that the remuneration set is fair and not out of line with that generally paid for similar roles. While the Chief Executive is spOnSible for determining staff salaries. within the approved salary budget set by the Board. the provision of such information could be required for due diligence purposes. Mombor Forum Under the newly adopted Articles of Ass¢xiation120191 The Society is no longer obligated to hold an Annual General Meetin8 and on 20 November 2020 The Society hosted its first annual Members Forum which provided members with an opportunity to hear from the President, President-Elect, Incoming President-Elect, Chief Executive, Honorary Treasurer, Incoming Trustees and Editors-in-chief about our activities and future plans. To retain transparency and enable open discussion between the Board and the membership there was opportunity for members to ask question5. The Forum concluded with our award5 ceremony, recognising our Honorary Members, Fellows and Rob Clarke Award winners. We also presented our first ever Award for Exemplary Service to The Society. Due to COVID-19 restrictions this event had to take place online but was recorded and can be viewed on The Societws YouTube Channel.. htt utube.com WatCh?UNaPoRvofA8 Principal risks and uncertainties The Trustees identify their approach to risk as aiming to minimise adversity and maximise opportunities to balance the successful advancement of The Sociews charitable objects with appropriate due diligence and financial prudence to safeguard a 5UStainable fijture for The Society and for the physiology discipline. Trustees acknowledge that ri5k-taking at 3 strategic level is necessary for innovation and opportunity and consider a balance of prudente and venture essential to successtul management of the organisation and realisation of its objectives. 20
The Physiological 2 Independent auditor's report to the members of The Physiological Society Opinion We have audited the financial statements of The Physiological Society for the year ended 31 December 2020, which comprise the Statement of financial activitie5, the balance Sheets, the statement of cash flow5 and the notes to the financial 5tatement5, includin8 a svmrnary of significant accounting policie5. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 Yhe Financial Reporting Standard applicable in the UK and Republic of Ireland, (United Kingdom Generally Accepted Accounting Practicel. In our opinion, the financial statements.. give a true and fair view of the state of the charitable compan¢s affairs as at 31 December 2020 and of the charitable companWs income and expenditure for the year then ended- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice.. and have been prepared in accordance with the requirements of the Companies Act 2(M)6. Basis for opinion We conducted our audit in accordance with International Standards on Auditing IUKI IISAS IUKII ènd applicable law. Our responsibilities under those standards are further described in the Ayditor's responsibilities for the audit of the financlal 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 UK, including the FRC'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 Trustees, use of the going concern basis of aceountin8 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 other information comprises the information included in the Trustee's Annual Report. Our opinion on the financial statement5 does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not expre55 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 themselve5. If, based on the work we have performed, we conclude that there 15 a material misstatement of thi5 Other information, we are required to report that fart. We have nothing to report in this regard. 22
The Physiological Opinions on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audit= the information given in the Trustees. report. which is also the directors. report for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements.. and the Trustees, report, which is also the directors, report for the purposes of company law. has been prepared in accordance with applicable legal requirements. Matters on which we are required to report by exception In the light of the 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 Trustees. report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to vou if. in our opinion.. adequate accounting records have not been kept. or returns adequate for our audit have not been received from branches not visited by us.. or the financial statements are not in agreement with the accounting records and returns,. or certain disclosures of Trustees, remuneration specified by13w are not made,. or we have not received all the information and explan3tions we iequire for our audit,. or the Trustees were not entitled to prepare ihe financial statements in accordance with the small companies re8ime and take advantage of the small companies, exemptions in preparing the trustees, report and from the requirement to prepare a strategic report. Responsibilities of Trustees A5 explained more fully in the Trustees, responsibilities statement, the Trustees Iwho ère also the directors of the charitable ¢ompany for the purposes of company lawl are rest)onsible for the preparation of the financial statement5 and for being sat15fied that they give a true and fair view, and for such internal control a5 the Trustees determine is ne¢essary 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 charitable company's ability to continue as a going concern. disclosin& as applicable. matters related to going concern and using the going concern basis of accounting unle55 the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so. Auditorfs responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement. whether due to fraud or error. and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance. but is not a guarantee that an audit conducted in accordance with ISAS IUKI will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if. individuallyor 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 instsnces of non-compliance with13ws and gUlatiOns. 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 obtained an understanding of the legal and regulatory frameworks applicable to the charity and the sector in which it operates. We determined that the following laws and regulations were most significant.. Accounting and 23
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