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2022-03-31-accounts

Annual Report and Consolidated Accounts for the year ended 31 March 2022

Registered Charity No 215551

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Contents

Morden College Annual Report 2022 Annual Report and Consolidated Accounts for the year ended 31 March 2022 Registered Charity No 215551

3

Foreword from the Chair of Trustees

In many respects 1 April 2021 heralded in a new era for Morden College. Although the coronavirus pandemic was not fully over, the Omicron variant yet to land in the UK, the College had travelled through the period of the Delta variant (Lockdown 3) without too much challenge and sadly, but only, one death from the virus. There was a sense that we were at the beginning of the end of it all, this reinforced by a successful programme of vaccination for almost every one of our circa 300 beneficiaries (bar 4 who could not be given a vaccination) and increasing numbers of staff. It felt safer. The new John Morden Centre was opening up. Life in our community awakening to what would evolve to become a more enjoyable Summer for beneficiaries. There was optimism in April 2021 and challenge too as the Charity set about a different future.

Alderman Sir David Wootton MA

It was not only that we had learnt a lot during the pandemic period about how the Charity operated; rather, that what we had learnt reinforced the messages that had emerged during 2018/19 as a result of extensive strategic research and thinking into how the Charity was delivering its core business (to provide homes, care and support to older people); what was right, what was wrong, and how should the Charity stride into the future.

During 2020 we learnt how excellent many of our staff are, their commitment and professionalism unfaltering. We learnt too that the organisational structure of the Charity, was no longer right, if in future we were to be fully prepared both for further testing

viral epidemics, and also embrace the strategic aims that Trustees and the Executive had settled on as a result of their strategy day in April 2019. Perhaps the most revealing lesson we learnt in 2020/21 was that many of our oldest beneficiaries living in the Charity’s almshouse accommodation needed far more support than they were being given and sadly, that many in our community had probably needed that greater level of support for some time. The old notion of ‘living independently’, and what the Charity had actually been doing to support its resident beneficiaries, was put firmly on trial during the pandemic. It was evident that it was time to look at the almshouse community at Morden College very differently, and change.

Morden College Annual Report 2022

4

So, while the year to March 2022 saw an improving life for our older people, it has also been a year of huge and very courageous change in how the Charity operates, now and in future.

Our first area of change was to the Charity’s Care Home. In April 2019, Trustees and I committed to operating a smaller Care Home; and in the Autumn of 2020 we confirmed the Care Home would for at least the next 2-3 years reduce from 60 beds to 44 beds. This decision necessarily meant that the Charity had to adjust both the Care Home staff structures and the Charity’s operating practices. The aim was not simply a smaller unit; but a change of direction to a Care Home that would be focussed primarily on acute nursing care, dementia care, end of life care, and some respite. There would be less emphasis on residential ‘personal’ care which historically the Charity had majored on. The intent was for the restructure of the Care Home staff to be complete by earlymid Summer 2021 and this was achieved.

The second consequence of deciding to carry out less residential ‘personal’ care in our Care Home was that the Charity had to change its operating practices; identify and deliver a different approach to both the care and support of its beneficiaries living in the almshouse accommodation to enable those beneficiaries (200+) to live a Good Life, such that they could live better, more safely, and with fewer anxieties, for longer, at home. This ideal is spoken about so often in the UK. Age UK and others have done a lot of research into ageing. Yet at Morden College we had not truly grappled with what it really means to live a Good Life in older age, to the end of life. What are the phases of ageing, and what is the menu of support (services) that would need to be put in place, in practice, provided by Morden College or from external sources, to deliver this ‘Good Life’. This approach, once embedded, will fundamentally be about prevention, proactively advising and where necessary supporting our beneficiaries practically (with services) in order to enable a better older life. How would this new approach be organised and funded? In the early Autumn 2021, having a few months earlier restructured the Charity’s Care Home, and after 40 or so years of doing broadly the same, we determined to grasp the nettle; no more ‘same old’!

It was not until into 2022 that we finally settled on how the Charity would organise to achieve its goal of rolling out the Good Life agenda. In fact, as I write this (in May 2022) the new Health and Wellbeing Strategy is yet to be fully endorsed. However, the staff structure we would need, principally the non-Care Home element of the Health & Wellbeing department, was agreed in late 2021; and so in January 2022 we began a further, smaller, restructure of the Charity. At the heart of this restructure we chose to embrace a new, in many respects pioneering, multidisciplinary approach to primary care of our beneficiaries, with increasingly a greater focus on prevention. It is exciting. There is a huge amount to do and no doubt there are going to be bumps along the journey; but as the financial year came to a close on 31 March 2022, the restructures, (the Care Home in mid 2021 and the non Care Home health and wellbeing staff in early 2022) were finally complete. We have also moved a number of ‘frontline’ services from the Operations area to Health & Wellbeing – the intention being to more fully empower Director of Health & Wellbeing with all the levers necessary to be able to coordinate and signpost the best care and support for our older people. A new era begins at Morden College.

But it has not all been about changes to how we care for and support our older beneficiaries.

During 2021 Trustees reviewed the Charity’s model for investment. The result of this was that all for our investment asset classes, including the commercial real estate and properties Morden College owns, performance is now monitored on a Total Return basis. The Charity’s fourth Strategic Aim is ‘Sustain Sir John Morden’s Charity for another 300 years’ and whilst this may seem a lofty ideal to some, it is not for us. Our Founder, Sir John Morden, implies very strongly in his letter of Deed, written in 1706, that he was endowing the foundation he established so that it would survive in perpetuity. Trustees and I intend the Charity will thrive long term. Of course, ensuring the College carries out all its responsibilities to today’s generation of beneficiaries, resident and in future non-resident, is our priority. But equally important, and a close second priority, is for us to ensure Sir John Morden’s endowment (the Charity’s investments) retains a capital strength, commensurate with inflation year on year.

The challenge for the Charity’s Trustees and Directors is to find the right balance; to deliver sufficient income for the now, while retaining (and growing) a capital strength such that the Charity will endure in perpetuity. There will, I believe, always will be a positive tension between these two priorities. We aim each year to increase the value of the Trust for Investment by at least inflation (protecting for the long term); while we hope, in the good years, to grow the Unapplied Total Return (the surplus) so that Morden College can evolve and achieve its ambitions – the recent construction of our new John Morden Centre is a good example of how we use our reserves.

Looking forward, I anticipate the next few years will largely be about consolidation, bedding in the very significant changes we have recently made to how Morden College is structured and operates, in order to meet the Charity’s strategic aims. We need now to monitor and measure our performance with great accuracy. In this next period, it is Trustees’ intent that Morden College will also begin to grow a new non residential beneficiary base in the Charity’s local areas. This will be an expansion of Sir John Morden’s charitable giving, largely into grant making; and we hope will be a welcome initiative, locally in South East London.

Finally, it remains for me to thank my fellow Trustees, the Executive and all the staff at Morden College. It really has been a monumentally challenging time, and test of leadership since early 2020 as we have journeyed through both a major pandemic crisis and a huge restructure of the Charity. I am so proud of what has been achieved. I recognise too that we have some way to go before the changes we have made bed in fully and deliver the result we are all working towards; to, as much as we are able, support our community of older people to live a good life, one that is safe, fulfilling and happy, until the end of life.

Alderman Sir David Wootton Chair of Trustees

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History and Constitution

Morden College is the general title used for the administration of Sir John Morden’s Charity and Dame Susan Morden’s Charity. Both Charities were established under separate Trust Deeds but they share the same Registered Charity Number 215551.

Sir John Morden died on 6 September 1708 and his Charity was founded by a will dated 15 October 1702, proven on 6 October 1708. Sir John left approximately £12,500 to endow the Charity. It is administered by not less than seven and not more than nine Trustees. It is primarily for the benefit of elderly people who are in need of accommodation or financial assistance.

The Charity of Dame Susan Morden was founded by a will dated 6 May 1717 and is administered by the Trustees of Sir John Morden’s Charity in accordance with the Scheme established by the Charity Commission on 22 August 1986. It is primarily for the benefit of clergymen, churches and parochial buildings of the Church of England.

The Trustees of the Charity are drawn, in the main, from the Court of Aldermen of the City of London. Trustees who retire from the Court of Aldermen of the City of London remain eligible to continue to serve as Trustees of the Charity. Trustees are appointed on the basis that they possess the appropriate range of skills and experience that will assist the future growth and development of the Charity.

Where it is recognised that certain particular skills and experience needed are not met from the Aldermen group, the Charity has gone outside to look for sector experts, and two Trustees are currently non-Aldermen.

People

TRUSTEES

Chairman and Honorary Treasurer Alderman Sir David Wootton MA

Trustees Alderman Sir Peter Estlin FCA BSc

ADVISORS TO THE TRUSTEES

Honorary Surveyor George Gillon MBE FRICS

Advisor on Care Dr Caroline Shuldham OBE

Alderman Sir William Russell

OFFICERS AND SENIOR MANAGERS

Alderman Professor Michael Mainelli FCCA FCSI FBCS

Alderman Alison Gowman

Alderman Alastair King

Fredrik Widlund

Clerk to the Trustees & Chief Executive David Rutherford-Jones CB

Chaplain The Rev’d William Warren

Finance Director Kate Morris MSc ACMA BA

Dr Abigail Masterson

Director of Real Estate Ed Mileham MRICS BSc

Director of Health & Wellbeing Debbie Dollner

Head of HR Sabrina Brown Assoc CIPD BA

Director of Operations Richard McAllister

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Trustees’ Report

Our Vision

A world in which older people can live a good life, supported and safe.

Our Culture

Our Values

Our success is underpinned by the understanding all our people have of the culture we wish to see win through; a Culture that:

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Promotes the
Celebrates highest standards
Encourages of leadership,
inclusion,
and supports individual
diversity, and
creativity behaviour, and
equality
accountability in
everything we do
----- End of picture text -----

The visible embodiment of our culture evidenced every day by our staff as they go about their duties, underwritten by our Values:

Respectful

We are considerate, we foster a culture of dignity and we appreciate the different roles we each perform in delivering the objects of the Charity.

Compassionate

We are kind, caring, and inclusive.

Progressive

We are ambitious to embrace new ideas and technologies and keep improving what we do.

Accountable

We accept personal responsibility for how we act and for what we do, individually contributing to the Charity’s success; and we are accountable.

Morden College Annual Report 2022

8

Four Strategic Aims guide the Charity

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1
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Enable a life lived in independence for the older people we provide homes for.

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2
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Provide care through life until the end of life for our resident beneficiaries.

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3
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Grow the College community into our local community, creating a new non-residential beneficiary community locally.

4

Sustain Sir John Morden’s Charity for another 300 years.

Our plans over the next 2-3 years to achieve the strategic aims are framed around the following key projects and tasks that we will deliver, some of which are in progress, some of which are not yet started and some which have been completed.

In progress

Not yet started

Completed

Morden College Annual Report 2022

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Trustees’ Report continued

FINANCIAL REVIEW

The consolidated net surplus before transfers between funds and investment gains for the year under review was £205k compared to a £176k deficit for the previous year. With income marginally increased and costs slightly reduced, this was a year financially and operationally recovering from, and catching up after, the Covid pandemic.

(1) Income from charitable activities

Contributions from beneficiaries in our living accommodation (including the Care Home) this year were £3.599 million, a decrease of 13% compared to the previous year (2021: £4.127 million).

This decrease is as a result of not accepting new beneficiaries into the care home, initially due to the actions we were taking to manage the risk of infection spread and then in the second half of the year because we were working towards our 44-bed model. Filling voids in our Independent Living accommodation has also been challenging this year.

(2) Investment income from property

Rental Income this year was £8.864 million a slight increase of 2% compared to the previous year. Total income from property includes the dividends from our Property Funds. These numbers reflect the slow ‘return to normal’ in terms of our commercial tenants. The Covid pandemic significantly impacted the ability of some of our commercial tenants to pay rent, as they struggled with their own business models and demand. The staff team at Morden College actively managed the various scenarios with all of our tenants and as a result, the impact to rental collection in the end was minimised, in so far as was possible.

(3) Investment income from other investments

From the Charity’s Quoted Investment Portfolio, we withdrew £2.2 million this year; an increase compared to the previous year.

(4) Other income including donations

At £366k these are at a similar level for the previous year, 2021: £403k.

(5) Fundraising

The Charity does not undertake fundraising activities during its normal course of operations.

INCOME

Total income for the year was

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£15.066m
+ 1% increase
2022 £15.066 million
2021 £14.945 million
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CHARITABLE ACTIVITIES INVESTMENT INCOME FROM PROPERTY INVESTMENT INCOME FROM OTHER INVESTMENTS OTHER INCOME INCLUDING DONATIONS

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2%
15%
24%
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59%

Morden College Annual Report 2022

10

Expenditure

2021 was an exceptional year in terms of spend due to the costs of extending our operations in order to protect our beneficiaries during the pandemic, to manage the risk of infection spread and to sustain them during the restrictions. 2022 has seen us change the way we spend with a move to outsourcing key contracts.

(1) Grants and out/in pensions

Grants paid total £209k (2021: £256k). The total number of beneficiaries supported by grants (pensioners) was 92 (2021: 92). The number living outside the College who receive financial assistance from the Charity was 67 (2021: 66). The ambition of Morden College is to develop the breadth of this aspect of our giving in the future.

(2) Independent Living Housing Costs (including the Quadrangle)

Independent living costs at £5.61 million show an increase of 10% compared to the previous year (2021: £5.106 million).

One of the biggest contributors here was expenditure on property repairs which was higher than the year before, this was because of fixing unforeseen storm and flood damage as well as the catch up on normal repairs, delayed due to Covid.

(3) Care Home Costs

Care Home costs are static, £6.124 million in 2022 versus £6.102 million in 2021. Whilst the staffing restructure will in time show savings, during the year just gone, we have had to pay for the costs associated with restructuring.

2022 was another exceptional cost year for the College in terms of maintenance of the estate, the delivery of a new building for beneficiary use and significant improvements to our IT infrastructure and systems, quite apart from the costs of operating post-pandemic and the cost of many upgrades to delivery made as a result of our learnings from the pandemic.

We also, from 1 April 2021, increased pay for all at 2%. All staff now receive the London Living Wage or above.

(4) Investment Managers’ fees

Investment Managers’ fees are slightly increased year on year, rising from £291k (2021) to £345k because we drew down more from the portfolios. The overall costs of raising funds include the £1.023 million interest payment on the Bond borrowing.

(5) Property Management Costs

At £897k the costs associated with our direct property investments have slightly decreased this year (2021: £914k), despite there being increased activity, there has been more active direct management by the Real Estate team in terms of managing our assets and including the preparations for the sale of our Morden Wharf site.

EXPENDITURE

Total expenditure for the year was

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6% 1%
£14.861m
7%
- 2% decrease 2%
2022 £14.861 million
2021 £15.121 million 4%
1%
38%
GRANTS AND OUT/IN PENSIONS
INDEPENDENT LIVING HOUSING COSTS
CARE HOME COSTS
CHAPEL COSTS
FIRE SAFETY ENHANCEMENTS
INVESTMENT MANAGERS’ FEES
BOND INTEREST
PROPERTY MANAGEMENT 41%
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Morden College Annual Report 2022

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Trustees’ Report continued

INVESTMENTS

Sir John Morden left approximately £12,500 to endow the College when he died in 1708 and the permanent endowment assets of the Charity are now valued at £275 million. The permanent endowment assets include total College fixed assets, which includes the original land, investment properties and quoted investments.

Approximately 66% of the Charity’s endowment is invested in property (including property funds) and 34% in financial investments.

The time horizon for the endowment portfolio is very long term, reflecting the Charity’s history.

The minimum investment objective is the preservation of capital and income in real terms after inflation and distributions. The measure of inflation is the Consumer Price Index (CPI).

The College has adopted a total return approach and receives annual distributions from both the property portfolio and the financial portfolio.

The long term total return objective for the portfolio has been set as CPI inflation plus 3% p.a. as from 1st July 2021.

A reasonable level of capital volatility within the portfolio is considered by the Trustees to be acceptable in order to achieve the return objectives. However, the maximum capital losses in the financial portfolio in any one-year period in normal market conditions (defined as 98% of possible outcomes) should not exceed 15-20%.

In terms of responsible investment, the Trustees of Morden College believe that the endowment portfolio should be managed in a responsible and sustainable manner in accordance with its charitable objectives and social obligations.

Morden College uses the services of two fund managers and for the year covered by this report, the combined Sir John Morden financial portfolio underperformed both the composite benchmark and the long-term objective of CPI +3% p.a.

The Charity’s investment policy provides that the minimum investment objective is to preserve the capital and income of the Charity’s portfolio from inflation.

The Trustees have adopted the Total Return approach to accounting for the investments for the Sir John Morden’s Charity’s Permanent Endowment with effect from 1 April 2016. The Trustees are using the statutory powers included in the Charities Act 2011 (“the Act”) and given effect by the Charities (Total Return) Regulations 2013 (“the Regulations”), which do not require Charity Commission approval in order for the Total Return basis to be adopted.

The Trust for Investment is considered to be the value of the permanent endowment as at 1 April 2016 and may be increased by the allocation of unapplied total return, being the investment income and capital gains on the portfolio, from time to time.

The Trustees have determined that the Trust for Investment should be increased annually in line with RPI inflation to protect its real value, which has resulted in an increase of 9% in the current year (2021: 1.4%).

The Trust for Investment and the unapplied total return together comprise the permanent endowment fund disclosed in the notes to the accounts.

The total return for the year ended 31 March 2022 was gain of £36.7 million comprising income of £10.4 million and gains of £27.5 million, less investment management costs of £1.1 million. The balance of the Unapplied Total Return Fund at 31 March 2021 was £22.9 million and it is proposed that £19.4 million is allocated to the Trust for investment, in line with the Trustees’ policy established in 2017, and £10.4 million is converted to income and transferred to the unrestricted fund. The balance on the Unapplied Total Return Fund at 31 March 2022 is now £29.8 million.

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RESERVES

a. Unrestricted Funds

Funds I – IV are referenced and set out in the Scheme for The Charity of Sir John Morden as submitted to the Charity Commission in 1991.

b. Restricted Funds

c. Permanent Endowment

These funds are the capital of the Charity, and they are invested to produce income that is used to further the Charity’s work. The Permanent Endowment Fund may not be used for any other purposes. Its funds are invested in charitable property, investment property, quoted investments and cash deposits. The value of the Permanent Endowment Funds at the year end was £296 million, of which £275 million represents the Sir John Morden permanent endowment and £21 million represents the Dame Susan Morden permanent endowment.

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Trustees’ Report continued

RISKS

The risks of the Charity are monitored on a regular basis, and appropriate action is taken to reduce the risk of disruption to the effectiveness of the Charity’s work and operations. The Charity’s risk management strategy utilises a hierarchical approach to the monitoring of risk with the overall operational strategy delegated to the Chief Executive. All identified risks are assessed for the likelihood of occurrence and their possible impact. The risk management system is designed to mitigate the likelihood of occurrence and/or the impact.

Currently the Charity assesses and monitors nine organisational risks, the following three are our key risks:

• Property Investments

Charity’s endowment is invested in property, and it is the responsibility of the Property, Investment and Asset Allocation Committees to review the overall performance of the Charity’s real estate. The portfolio is managed in house with an expert team but in addition these Committees are authorised to seek third party professional advice where required. All key decisions are ratified by the Board of Trustees.

• Other Financial Investments

It is the responsibility of the Investment Committee and the Asset Allocation Committee to review the financial investment strategy and to set policies on such matters — it is also authorised to seek third party professional advice where required and changes to policies and recommended actions are ratified by the Board of Trustees. The investment strategy is to ensure that the value of the investment portfolio does not suffer a permanent diminution in value over the longer term. The strategy also has an objective to preserve the capital and income of the Charity’s portfolio from inflation.

More specifically the leadership of the organisation has identified the following areas of current risk:

STRUCTURE AND GOVERNANCE

Construction of Morden College began in 1695. It opened in 1700 for the benefit of poor, elderly merchants of good character who were either bachelors or widowers and who had failed in business through no particular fault of their own. Since that time, the qualifications for entry have been widened. They now include men or women of good character who have either been engaged in a trade, business, or a profession as principals, or reached a position of authority or seniority, in employment and who, through accident, misfortune, disability, or infirmity have been prevented from continuing to follow their former calling and are in reduced material circumstances. The qualifications also include the spouses, partners, widows and widowers of such men and women.

The Trustees are also empowered to provide assistance by way of pensions and grants for the elderly in need whether or not they are resident in the Charity’s homes. Donations may also be made to other Charities that provide or undertake in return to provide items, services, or facilities to beneficiaries of the Charity.

The Trustees determine the general policy of the Charity and delegate dayto-day management to the Clerk to the Trustees, whose role is that of Chief Executive. The Charity’s Senior Leadership Team holds regular meetings to review progress against objectives agreed with the Trustees. Meetings are minuted and copies are made available to the Chairman of the Trustees. The Chairman visits the Charity on a regular basis and meets with the Chief Executive.

The Trustees of the Charity are drawn, in the main, from the Court of Aldermen of the City of London. Trustees who retire from the Court of Aldermen of the City of London remain eligible to continue to serve as Trustees of the Charity. Trustees are appointed on the basis that they possess the appropriate range of skills and experience that will assist the future growth and development of the Charity.

• Operations including Care Provisions

The Charity has assessed operational risk, which may be defined as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events under a number of areas such as care, health and safety and fire. These are monitored and processes have been put in place to minimise the Charity’s exposure to risks arising from such areas. This is all managed by an expert team in house, supported by the Compliance Manager.

All Trustees go through an induction programme.

All Trustees give their time freely and no Trustee remuneration was paid during the year. There were no related party transactions with Trustees.

Trustees are required to disclose all relevant interests and register them with the Chairman of the Trustees and the Chief Executive.

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MANAGEMENT AND STAFF REMUNERATION

There are clear distinctions between the role of Trustees and the Senior Leadership Team. The Trustees hold a range of reserved matters and delegate certain authority to the Senior Leadership Team to run the organisation efficiently. Matters such as policy, strategy and budgets are prepared by the Senior managers for consideration and approval by the Trustees.

The Charity aims to pay salaries which are fair, competitive with the charity sector, and proportionate to the complexity of each role. In setting salaries, the Charity ensures:

– All staff receive ongoing performance management and an annual appraisal which provides them with feedback on how they have contributed to the achievement of the Charity’s strategy; and

Within Dame Susan’s charity the sole employee is the Chaplain who is supported in his role by the Chief Executive, the Finance Director and the Director of Real Estate and members of the staff team employed by Morden College as and when the need arises.

POLICIES

Applications policy

Applications for accommodation or outpensions must be submitted in writing and must be supported by independent testimonials. Applications for grants are also made in writing and are normally for single payments unless the need is assessed as a continuing one when the Charity may award an annual Outpension. The Trustees review all applications carefully and satisfy themselves that the applicant is genuine, and the assistance sought is in accordance with the Charity’s aims. All applicants for accommodation are interviewed by the Chief Executive before being recommended for admittance by the Trustees.

Grant Making Policy

Every application for a grant must be submitted in writing and include the total cost of the project for which the grant is sought. All applications are scrutinised to ensure that the request for assistance falls within the scope of the Charity’s Scheme. Applicants who are eligible for help are visited to clarify any outstanding matters. If all is found to be in order, a report is made to the Trustees, who consider the application, and instruct whether the grant should be made together with any conditions relating to it. Compliance with any conditions made is monitored, and payment of grants may be withheld if the terms of assistance are not met.

Responsible Leadership/ Environmental, Social and Governance (ESG) Policy

The Trustees of Morden College believe that all of Morden College’s business should be led and managed in accordance with the charitable objectives of both Sir John Morden and Dame Susan Morden charities, in a way that conforms to the College’s social, environmental and governance obligations.

Trustees support fully the ten principles of the United Nations’ Global Compact. Notably, Trustees and the Executive recognise their responsibility to take account of, and be responsible for, the impact Morden College’s business has on the environment and climate, sustainability, employment rights and practices, human rights, and on the College community as well as the wider (local to Morden College) community; and to work against all forms of dishonesty such as corruption, fraud, extortion, and bribery. This approach accords also with the College’s values: Respectful, Compassionate, Progressive, Accountable.

Morden College has codified 5 characteristics that define the Charity’s Responsible Leadership policy, as follows:

– Ensure the College’s industrial/ commercial/ residential/investment real estate portfolio meets the best possible Minimum Energy Efficiency Standards (MEES), and provides a well maintained, safe, and flexible environment within which our tenants and licensees can work, live, visit; and pay fair market rents

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Trustees’ Report continued

PUBLIC BENEFIT

The objective of the Charity is to relieve financial hardship suffered by older people and it does this primarily by providing living accommodation comprising independent living and a Care Home. We also make available such support as is necessary to enable beneficiaries to live their lives in the community to the full.

The Charity also provides single grants and continuing annual grants, (referred to as outpensions) to older people in financial need but who do not necessarily wish to apply to the Charity for accommodation. Beneficiaries receiving such grants use the money to defray living costs as they see fit.

The objective of Dame Susan’s Trust is the advancement of religion by assisting the Church of England with the upkeep of their churches and associated activities and by maintaining and paying for the operating costs of the Morden College Chapel and its Chaplain.

The Trustees have referred to the guidance contained in the Charity Commission’s general guidance on public benefit when reviewing the Charity’s aims and objectives and in planning future activities including the provision of accommodation, the making of grants and provision of outpensions.

The Charity fulfils these objectives by:

Applications for accommodation are received from older people who come from many different backgrounds but share a common problem in retirement in so far as they face financial difficulties. Enquiries for accommodation continue to be from all over the country as well as a small number from people living abroad but all applicants must have the right to live in the UK to qualify for accommodation. The number of applications has been increasing as the effects of financial austerity continue to be felt across the UK.

As properties become vacant, they are refurbished before being made available to applicants. It is common for bathrooms and kitchens to be replaced prior to re-letting to ensure the standard meets the needs of older people and flooring is replaced on a regular basis.

The Charity, via the Dame Susan Trust, seeks to deliver public benefit by making grants to Church of England churches who lack the necessary funds to maintain, repair and improve the fabric of their own buildings.

Regular services of worship were held throughout the year in the Morden College Chapel at Blackheath and at the Charity’s second site at Ralph Perring Court, Beckenham. Regular services are also held in Cullum Welch Court, the Care Home provided by Sir John Morden’s Charity which is situated at Blackheath.

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STATEMENT OF TRUSTEES RESPONSIBILITIES

The Trustees are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

The law applicable to charities in England & Wales requires the Trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Charity and of the incoming resources and application of resources of the Charity for that period. In preparing these financial statements, the Trustees are required to:

The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Charity and enable them to ensure that the financial statements comply with Charities Act 2011. They are also responsible for safeguarding the assets of the Charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Through a system of internal controls, the Trustees seek to ensure all expenditure is properly incurred and properly authorised, that receipt of income is secure, and that the Charity’s property is fit for purpose.

The financial statements have been prepared in accordance with the accounting policies set out in the notes to the accounts and comply with the Charity’s governing document, the Charities Act 2011 and Accounting and Reporting by Charities’ Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland.

Alderman Sir David Wootton MA Chair of the Trustees

David Rutherford-Jones CB Clerk to the Trustees & Chief Executive

21 September 2022

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Independent Auditor’s Report to the Trustees of Morden College

Opinion

We have audited the financial statements of Morden College for the year ended 31 March 2022 which comprise the Consolidated Statement of Financial Activities, the Group and Charity Balance Sheets, the Consolidated Statement of Cash Flows and the 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).

In our opinion, the financial statements:

Basis for opinion

We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder. 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 are independent of the group 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 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 group’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 Trustees’ 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.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the 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.

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 (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

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Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement set out on page 17, 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 determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the group’s and the parent 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 group or the parent charity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

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

Based on our understanding of the group and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to compliance with the regulations of the Care Quality Commission, the Charity Commission, Health and Safety regulations as well as general Charity Law, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Charities Act 2011.

We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to the potential to manipulate accounting estimates and judgements and the posting of inappropriate journal entries. Audit procedures performed by the engagement team included:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or noncompliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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

Use of our report

This report is made solely to the charity’s trustees, as a body, in accordance with section 144 of the Charities Act 2011 and regulations made under section 154 of that Act. 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’s trustees as a body for our audit work, for this report, or for the opinions we have formed.

Haysmacintyre LLP

Statutory Auditor 10 Queen Street Place London EC4R 1AG

Date: 15 November 2022

Haysmacintyre LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006

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Consolidated Statement of Financial Activities

for the year ended 31 March 2022

----- Start of picture text -----
Unrestricted Restricted Permanent Total Total
Funds Funds Endowment 2022 2021
Notes £’000 £’000 £’000 £’000 £’000
----- End of picture text -----

INCOME AND ENDOWMENTS FROM:
Charitable activities
Investment income from property
Investment income from other investments
Other income including donations
Total income
EXPENDITURE ON
Charitable activities
Raising funds
Total expenditure
Net income/(expenditure) before investment
gains/(losses)
Net gains on investments		 3,599
-
-
3,599
4,127
253
440
8,171
8,864
8,685
3
-
37
2,200
2,237
1,730
4
333
33
-
366
403
2
4,185
510
10,371
15,066
14,945
5a
11,531
125
940
12,596
12,896
5b
1,023
151
1,091
2,265
2,225
2
12,554
276
2,031
14,861
15,121
(8,369)
234
8,340
205
(176)
9c
167
-
28,195
28,362
25,980
Net income/(expenditure)
Transfer between funds
Net movement in funds
Reconciliation of funds
Total Funds brought forward at 1 April 2021		 (8,202)
234
36,535
28,567
25,804
7,514
-
(7,514)
-
-
(688)
234
29,021
28,567
25,804
20,268
1,052
266,568
287,888
262,084
Total funds carried forward at 31 March 2022 19,580
1,286
295,589
316,455
287,888

All of the above results are derived from continuing activities. All gains and losses recognised in the year are included above. The accompanying notes form an integral part of this Statement of Financial Activities.

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Group and Charity Balance Sheets

as at 31 March 2022

----- Start of picture text -----
Group Group Charity Charity
2022 2021 2022 2021
Notes £’000 £’000 £’000 £’000
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FIXED ASSETS
Tangible fxed assets
College Buildings
Other tangible fxed assets
Investment property
Quoted investments
Total fxed assets
CURRENT ASSETS
Debtors
Short term deposits
Cash at bank and in hand
Creditors: amounts falling due within one year
NET CURRENT ASSETS
Creditors: amounts falling due after more than one year
NET ASSETS
FUNDS
Permanent endowment
Sir John Morden
Dame Susan Morden
Restricted funds
Unrestricted funds
Total Charity funds		 8
34,561
35,615
35,204
36,268
8
2,431
2,342
2,431
2,342
36,992
37,957
37,635
38,610
9
210,116
182,731
210,116
182,731
9
86,639
85,234
86,639
85,234
296,755
267,965
296,755
267,965
333,747
305,922
334,390
306,575
10
898
1,036
888
1,036
8,729
10,103
8,729
10,103
5,734
3,970
5,732
3,962
15,361
15,109
15,349
15,101
11
(2,653)
(3,143)
(2,641)
(3,144)
12,708
11,966
12,708
11,957
12
(30,000)
(30,000)
(30,000)
(30,000)
316,455
287,888
317,098
288,532
13, 14
275,108
246,814
275,751
247,458
20,481
19,754
20,481
19,754
13, 14
1,286
1,052
1,286
1,052
13, 16
19,580
20,268
19,580
20,268
316,455
287,888
317,098
288,532

The financial statements on pages 20 to 38 were approved and authorised for issue by the Board of Trustees and signed on 21 September 2022 on its behalf by:

Alderman Sir David Wootton MA Chairman of the Trustees

David Rutherford-Jones CB Clerk to the Trustees & Chief Executive

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Consolidated Statement of Cash Flows

for the year ended 31 March 2022

----- Start of picture text -----
Group Group
2022 2021
Notes £’000 £’000
Cash flow from operating activities
Net cash provided/(used) in operating activities A (10,110) (8,612)
Cash flow from investment activities
Dividend, interest and rents from investments 11,101 10,415
Proceeds from the sale of investments 31,370 52,362
Purchase of investments (31,188) (52,029)
Purchase of tangible fixed assets (783) (3,454)
10,500 7,294
Change in cash and cash equivalents in the reporting period 390 (1,318)
Cash and cash equivalents at the beginning of the reporting period 14,073 15,391
Cash and cash equivalents to the end of the reporting period B 14,463 14,073
2022 2021
A. Reconciliation of net income to net cash flow from operating activities £000 £000
Net income/(expenditure) for the reporting period 28,567 25,804
Adjustments for
Depreciation charges 1,139 906
(Gains)/losses on investments (28,362) (25,980)
Dividends, interest and rents from investments (11,101) (10,414)
(Increase)/decrease in debtors 150 945
Increase/(decrease) in creditors (503) 127
(Increase)/decrease in work in progress - -
Net cash used in operating activities (10,110) (8,612)
B. Analysis of cash and cash equivalents
Cash in hand 5,734 3,970
Notice deposits (less than 3 months) 8,729 10,103
Total cash and cash equivalents 14,463 14,073
C. Cashflow Net Debt
At 1 At 31
April 2021 Cashflows March 2022
£'000 £'000 £'000
Cash in hand 3,970 1,764 5,734
Notice deposits 10,103 (1,374) 8,729
Sub-total 14,073 390 14,463
Long-term bond (30,000) - (30,000)
Net debt (15,927) 390 (15,537)
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Notes to the Accounts

for the year ended 31 March 2022

1. PRINCIPAL ACCOUNTING POLICIES

The accounts have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Charities Act 2011 and UK Generally Accepted Accounting Practice as it applies from 1 January 2015. The accounts have been prepared to give a ‘true and fair’ view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a ‘true and fair view’. This departure has involved following Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), (Second Edition, effective 1 January 2019) rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005, which has since been withdrawn.

Public Benefit

The Charity constitutes a public benefit entity as defined by FRS102.

Consolidation

The consolidated accounts incorporate the results of Sir John Morden’s and Dame Susan’s Charities (the Charity) and its subsidiary undertaking, Morden College Design and Build Limited. The consolidated entity is referred to as the Group.

Going Concern

The Charity has a significant level of cash reserves which were the equivalent of more than 12 months operating costs at the balance sheet date. These cash reserves provide adequate resources to finance the Charity’s day to day operations. On this basis, the Board 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, it continues to adopt the going concern basis in the financial statements.

Investment Gains and Losses

Realised gains and losses on quoted investments are based on the difference between the net disposal proceeds and the value.

Realised gains and losses on property investments are based on the difference between the net disposal proceeds and the brought forward valuation. Sales are recognised on exchange of contracts where completion takes place after the financial year end.

Unrealised gains and losses represent the difference between the market value of quoted investments and investment properties at the balance sheet date and their brought forward carrying value or purchase cost for investments acquired during the year.

Estimation uncertainty

Information about estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below. The principal judgments and sources of estimation uncertainty relate to the valuation of investment properties and the estimated useful lives of tangible fixed assets.

Income

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Expenditure

(4) Governance costs reflect the cost of compliance with constitutional and statutory requirements.

(5) Liabilities are recognised when there is a contractual obligation to discharge a cost.

Investment property

The Charity’s Commercial investment properties were last professionally valued by Messrs Gerald Eve LLP, Chartered Surveyors, as at 31 March 2022 on an open market basis in accordance with the Royal Institution of Chartered Surveyors Valuation Professional Standards. The Charity’s residential investment properties were professionally valued by Messrs Humphreys Skitt, Surveyors, as at 31 March 2013 on an open market basis in accordance with the Royal Institution of Chartered Surveyors Valuation Professional Standards. Since that date, the investment properties have been revalued by the Trustees on an open market basis each year by taking into account published indices for the changes in property values. For the 2022 valuation, the estimated increases in residential property values for Greater London have been calculated by reference to the Nationwide Building Society’s survey results.

Investment properties are classified in the balance sheet as fixed assets unless there is a firm intention to dispose of them at which point they are transferred to current assets.

Quoted Investments

Quoted investments are shown at market value as at the balance sheet date. The SOFA includes the net gains and losses arising on revaluations and disposals throughout the year.

The Charity also owns 100% of the share capital of Morden College Design and Build Limited and the value of this investment is stated at cost (£2).

Tangible fixed assets

Useful lives of depreciable assets

The Trustees review their estimate of the useful lives of depreciable assets at each reporting date based on the expected utility of the assets. Uncertainties in these estimates relate to technological obsolescence that may change and changes to circumstances which may require more frequent replacement of key buildings or components of existing buildings.

The key judgements and estimates applied in respect of housing provided for beneficiaries are disclosed in the accounting policy dealing with fixed assets and depreciation and include:

These are conservative assumptions that are broadly aligned with general practice followed by registered housing providers.

Capitalisation of property development costs

Distinguishing the point at which a project is more likely than not to continue, allowing capitalisation of associated development costs requires judgement. After capitalisation management monitors the asset and considers whether subsequent changes may indicate that impairment is required.

Fixed Assets and Depreciation

(1) Buildings

Freehold land is not depreciated.

Depreciation of housing property components is charged so as to write down the cost of the components to their

Morden College Annual Report 2022

24

estimated residual value, on a straight-line basis, over their estimated useful economic lives within the Group. Housing property components are depreciated from the year following the replacement year. Estimated useful economic lives are assumed as follows:

Major components

Furniture and equipment 5 years Motor vehicles 4 – 10 years Computers 4 years

Grants

Grants payable are charged in the Statement of Financial Activities in the year that the payment is made to the recipient. All grants approved by the Trustees are conditional and are paid upon the completion of the conditions attached to them. Grants offered during the year but where conditions have not been met are not accrued as expenditure but are treated as contingent liabilities.

Pension costs

Pension payments are made to a defined contribution pension scheme. There is also one (2021: 1) member who was in the wound up defined benefits scheme and the Trustees have given their undertaking to use their best endeavours to ensure that this member does not suffer any loss of benefit following the closure of that scheme. All contributions are included in the SOFA when due.

Funds and Reserves Policy

Funds held by the Charity are:

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25

Taxation

The trust is a registered charity and as such its income and gains falling within sections 471 to 489 of the Corporation Tax Act 2010 or section 256 of the Taxation of Chargeable Gains Act 1992 are exempt from corporation tax to the extent that they are applied to its charitable objectives.

Financial Instruments

The Charity only has financial instruments of a kind that qualify as basic financial instruments such as debtors, creditors, cash at bank and listed investments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value. Financial assets held at settlement cost comprise cash and bank and cash in hand together with debtors. Financial liabilities held at settlement value or amortised cost comprise rents received in advance, accruals and other creditors, and the fixed interest bond. The Financial investments disclosed in note 9 are the only financial instruments measured at fair value.

2. COMPARATIVE STATEMENT OF FINANCIAL ACTIVITIES

----- Start of picture text -----
Unrestricted Restricted Permanent Total
Funds Funds Endowment 2021
£’000 £’000 £’000 £’000
----- End of picture text -----

INCOME AND ENDOWMENTS FROM
Charitable activities
Investment income from property
Investment income from other investments
Other income including donations
Total income
EXPENDITURE ON
Charitable activities
Raising funds
Total expenditure
Net income/(expenditure) before investment gains/(losses)
Net gains on investments
Net income/(expenditure)
Transfer between funds
Net movement in funds
Reconciliation of funds
Total funds brought forward at 1 April 2020
Total funds carried forward at 31 March 2021		 4,127
-
-
4,127
6,697
382
1,606
8,685
-
30
1,700
1,730
406
(3)
-
403
11,230
409
3,306
14,945
11,851
138
906
12,896
1,782
153
289
2,225
13,634
291
1,195
15,121
(2,404)
118
2,111
(176)
1,013
-
24,967
25,980
(1,391)
118
27,077
25,804
(178)
-
178
-
(1,569)
118
27,255
25,804
21,837
934
239,313
26,084
20,268
1,052
266,568
287,888

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26

3. INVESTMENT INCOME

----- Start of picture text -----
2022 2021
£’000 £’000
----- End of picture text -----

2022
£’000
2021
£’000
Dividends and income from investments
Interest on cash deposits		 2,209
1,730
28
-
2,237
1,730

4. OTHER INCOME

----- Start of picture text -----
2022 2021
£’000 £’000
----- End of picture text -----

2022
£’000
2021
£’000
Benefciary restaurant receipts and sundry income
COVID-19 funding
Dame Susan Morden’s Charity		 255
170
101
233
10
-
366
403

5. EXPENDITURE

----- Start of picture text -----
Direct
Staff Other Apportioned
Costs Costs costs Total
£’000 £’000 £’000 £’000
----- End of picture text -----

Direct
Staf
Costs
£’000
Other
Costs
£’000
Apportioned
costs
£’000
Total
£’000
a. Charitable activities
2022
Grants and out/in pensions
Independent living housing costs
Quadrangle housing costs
Care home costs
Morden College Chapel costs
Fire safety enhancement works
2021
Grants and out/in pensions
Independent living housing costs
Quadrangle housing costs
Care home costs
JMC Projects delivery costs
Morden College Chapel costs
Fire safety enhancement works
COVID-19 expenditure		 -
184
25
209
118
1,628
1,469
3,215
153
347
1,898
2,398
2,841
566
2,717
6,124
54
34
-
88
-
562
-
562
3,166
3,321
6,109
12,596
-
231
25
256
95
1,693
1,270
3,058
188
313
1,547
2,048
3,121
710
2,271
6,102
-
9
-
9
48
24
-
72
-
585
-
585
-
765
-
765
3,451
4,331
5,114
12,896

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Direct
Staf
Costs
£’000
Other
Costs
£’000
Apportioned
costs
£’000
Total
£’000
b. Cost of raising funds
2022
Quoted Investment Managers’ fees
Bond Interest
Property Management
2021
Quoted Investment Managers’ fees
Bond interest
Property management		 -
345
-
345
-
1,023
-
1,023
-
746
151
897
-
2,114
151
2,265
-
291
-
291
-
1,021
-
1,021
-
799
115
914
-
2,110
115
2,225
Donations,
grants
and out
pensions
£’000
Independent
living
housing
costs
£’000
 Sheltered
housing
costs
£’000
Care home
costs
£’000
Property
management
£’000
Total
£’000
c. Apportioned costs have been allocated on a use basis as follows
2022
Catering
-
-
Restaurant
-
63
Library & Muniments
-
7
Gardens
-
145
Administration
25
1,254
25
1,469
2021
Catering
-
-
Restaurant
-
77
Blackheath Social
-
19
Library & Muniments
-
4
Gardens
-
268
Administration
25
902
25
1,270		 238
399
-
637
-
-
-
63
7
-
-
14
46
78
-
269
1,607
2,240
151
5,277
25
1,469		 1,898
2,717
151
6,260
-
-
-
77
-
19
-
4
-
268
25
902		 271
438
-
709
-
-
-
77
19
-
-
38
4
-
-
8
87
141
-
496
1,166
1,692
115
3,900
25
1,270		 1,547
2,271
115
5,228

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6. PAYMENT OF OUT/IN PENSIONS

2022
£’000
2021
£’000
Individuals (Pensioners)
Administrative costs		 131
140
25
25
156
165

There were 92 pensioners at 31 March 2022 (2021: 92)

7. WAGES AND SALARIES – STAFF COSTS (INCLUDING APPORTIONED COSTS)

----- Start of picture text -----
2022 2021
£’000 £’000
----- End of picture text -----

Staf costs
Wages and salaries
Social security costs
Pension contributions
Other costs including bank and agency staf		 5,208
5,797
547
566
272
297
447
284
6,474
6,944

Staff costs – Wages and salaries include redundancy cost of £279k

Staff numbers

The average number of employees during the year including those who worked part-time was 161 (2021:213). Their full time equivalent was 144 (2021: 186) and their functional analysis was as follows:

2022
No.
2021
No.
Cost of raising funds
Property management
Charitable activities
Kitchen and domestics
Nursing
Premises, grounds and security
Home management and pastoral
Management and administration		 7
5
36
42
57
82
12
19
2
1
30
36
144
186
2022
2021
Highest paid employees, including benefts, excluding pensions
£60,000 to £80,000
£80,001 to £90,000
£90,001 to £120,000
£120,001 to £130,000
£130,001 to £140,000		 7
6
1
1
2
2
1
1
1
-

The Group’s key senior managers are listed on page 7. Details of remuneration policy are set out in the Trustees’ Report. Total remuneration paid to senior managers, including employers NI, was £994k (2021: £950k).

No Trustees received any remuneration during the year, but did receive £1,533 as reimbursement of expenses (2021: £415).

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8. TANGIBLE FIXED ASSETS

Group
£’000
Charity
£’000
Charitable Buildings
Cost
At 1 April 2021
Additions at cost
Transfer of asset to investment property
At 31 March 2022
Depreciation
At 1 April 2021
Charge for the year
At 31 March 2022
Net book value at 31 March 2022
Net book value at 31 March 2021		 45,165
45,818
487
487
(611)
(611)
45,041
45,694
9,550
9,550
940
940
10,490
10,490
34,561
35,204
35,615
36,268
Antiques &
valuables
£’000
Computers
£’000		 Furniture &
equipment
£’000
Total
£’000
Other fxed assets – Group and Charity
Cost or Valuation
At 1 April 2021
Additions at cost
Disposals/scrapped
At 31 March 2022
At valuation
At cost
Depreciation
At 1 April 2021
Disposals/scrapped
Charge for the year
At 31 March 2022
Net book value at 31 March 2022
Net book value at 31 March 2021		 1,688
436
-
193
-
-		 2,012
4,136
94
287
-
-
1,688
629		 2,106
4,423
-
-
1,688
629
-
166
-
-
-
92		 -
-
2,106
4,423
1,627
1,793

-
-
107
199
-
258		 1,734
1,992
1,688
371		 372
2,431
1,688
270		 385
2,343

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30

9. INVESTMENT ASSETS AT MARKET VALUE

----- Start of picture text -----
2022 2021
£’000 £’000
----- End of picture text -----

a. Investment property
Residential
Commercial and Industrial incl Property Fund
b. Quoted investments
Fixed interest – UK & non UK
Equities – UK & non UK
Stockbrokers’ client account
Historical cost of investments held at 31 March 2022		 58,356
46,815
151,760
135,916
210,116
182,731
12,368
16,691
71,949
67,302
84,317
83,994
2,322
1,240
86,639
85,234
85,234
85,715

----- Start of picture text -----
Quoted
Property Investments Total
£’000 £’000 £’000
----- End of picture text -----

Property
£’000
Quoted
Investments
£’000
Total
£’000
c. The movements in market value may be summarised:
Market value at 31 March 2021
Realised gains/(losses)
Unrealised gains/(losses)
Additions
College Building Transfer (BBC)
Disposals
Change in stockbroker cash deposits
Market value at 31 March 2022		 182,731
85,234
267,965
-
4,878
4,878
26,616
(3,133)
23,483
209,347
86,979
296,326
158
31,030
31,188
611
-
611
-
(32,366)
(32,366)
-
996
996
210,116
86,639
296,755

Within the Investment Property, Commercial and Industrial number,is a valuation of £37.5m for our Morden Wharf site. Since the year end date the site has the benefit of planning permission for a significant mixed-use development. The planning permission has triggered the opportunity to sell the site, along with a joint venture partner under a Conditional Development Agreement. It may be that the eventual value of a sale to Morden College is in excess of this year end valuation, but the amount and timings are uncertain. The value included with the accounts reflects the position as at the year end, representing the income from the site with a long-term tenant in situ.

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10. DEBTORS

----- Start of picture text -----
Group Charity
2022 2021 2022 2021
£’000 £’000 £’000 £’000
----- End of picture text -----

Group
Charity
2022
£’000
2021
£’000
2022
£’000
2021
£’000
Rent and contributions receivable
Prepayments and sundry debtors
Dividends and interest receivable
Due from subsidiary undertaking		 239
383
239
383
447
316
437
316
210
337
210
337
2
-
2
-
898
1,036
888
1,036

11. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

----- Start of picture text -----
Group Charity
2022 2021 2022 2021
£’000 £’000 £’000 £’000
Advance rents received 1,264 1,236 1,264 1,236
Tax, pensions and social security 148 180 148 180
Value Added Tax 246 231 246 231
Sundry creditors 715 828 703 829
Accruals 280 668 280 669
2,653 3,143 2,641 3,144
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12. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

Group
Charity
2022
£’000
2021
£’000
2022
£’000
2021
£’000
Fixed Interest Bond 30,000
30,000
30,000
30,000
30,000
30,000
30,000
30,000

The Bond has a maturity date of 27 March 2042 and carries a fixed rate of interest of 3.38% until maturity. The Bond is repayable as a single amount.

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13. ALLOCATION OF THE NET ASSETS OF THE GROUP AND CHARITY

Endowment
Funds
£’000
Restricted
Funds
£’000
Unrestricted
Funds
£’000
Total
Funds
£’000
Group 2022
College buildings
Other tangible fxed assets
Investments - Sir John Morden
Investments - Dame Susan Morden
Net current assets
Long-term liability (Bond)
Group 2021
College buildings
Other tangible fxed assets
Investments - Sir John Morden
Investments - Dame Susan Morden
Net current assets
Long-term liability (Bond)		 34,561
-
-
34,561
1,688
12
731
2,431
265,594
-
10,680
276,274
20,481
-
-
20,481
3,265
1,274
8,169
12,708
(30,000)
-
-
(30,000)
295,589
1,286
19,580
316,455
35,615
-
-
35,615
2,323
19
-
2,342
239,618
-
8,593
248,211
19,754
-
-
19,754
(742)
1,033
11,675
11,966
(30,000)
-
-
(30,000)
266,568
1,052
20,268
287,888
Endowment
Funds
£’000
Restricted
Funds
£’000
Unrestricted
Funds
£’000
Total
Funds
£’000
Charity 2022
College buildings
Other tangible fxed asset
Investments - Sir John Morden
Investments - Dame Susan Morden
Net current assets
Long-term liability (Bond)
Charity 2021
College buildings
Other tangible fxed assets
Investments - Sir John Morden
Investments - Dame Susan Morden
Net current assets
Long-term liability (Bond)		 35,204
-
-
35,204
1,688
12
731
2,431
265,594
-
10,680
276,274
20,481
-
-
20,481
3,265
1,274
8,169
12,708
(30,000)
-
-
(30,000)
296,232
1,286
19,580
317,098
36,268
-
-
36,268
2,323
19
-
2,342
239,618
-
8,584
248,202
19,754
-
-
19,754
(751)
1,033
11,684
11,966
(30,000)
-
-
(30,000)
267,212
1,052
20,268
288,532

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14. PERMANENT ENDOWMENT FUNDS

Balance at
1 April 2021
£’000
Income
£’000
Expenditure
£’000
Gains/
(losses)
£’000
Transfers
£’000
Balance at
31 March
2022
£’000
Group 2022
Sir John Morden
Dame Susan Morden
Group 2021
Sir John Morden
Dame Susan Morden		 246,814
10,371
(2,036)
27,473
(7,514)
275,108
19,754
-
5
722
-
20,481
266,568
10,371
(2,031)
28,195
(7,514)
295,589
220,650
3,306
(1,200)
23,881
178
246,814
18,663
-
5
1,086
-
19,754
239,313
3,306
(1,195)
24,967
178
266,568
Balance at
1 April 2021
£’000
Income
£’000
Expenditure
£’000
Gains/
(losses)
£’000
Transfers
£’000
Balance at
31 March
2022
£’000
Charity 2022
Sir John Morden
Dame Susan Morden
Charity 2021
Sir John Morden
Dame Susan Morden		 247,458
10,371
(2,036)
27,473
(7,514)
275,751
19,754
-
5
722
-
20,481
267,212
10,371
(2,031)
28,195
(7,514)
296,232
221,303
3,306
(1,200)
23,881
168
247,458
18,663
-
5
1,086
-
19,754
239,966
3,306
(1,195)
24,967
168
267,212

The Permanent Endowment Fund is a restricted fund that includes the current value of the original endowment that was to provide homes and financial assistance for the elderly. In 2016, the Trustees resolved to apply Total Return accounting to the portion of the Sir John Morden permanent endowment fund that is represented by fixed asset investments.

The Trustees have established a policy of transferring the investment income received in the year to the general fund and retaining the balance of the Unapplied Total Return within the endowment fund. This policy is reviewed annually by the Trustees.

The total of the Trust for Investment and the Unapplied Total Return these items make up the Permanent Endowment Fund and this has shown an increase of 5% year on year; this more accurately reflects the cost inflation pressures facing Morden College.

Income from the Trust for Investment is to be applied to the running costs of the Charity. The capital may be used to purchase property for charitable and investment purposes, but the maintenance and refurbishment of these properties must be paid from the income of the Charity.

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14. PERMANENT ENDOWMENT FUNDS (CONTINUED)

----- Start of picture text -----
Unapplied
Permanent Total
Endowment Return Total
£’000 £’000 £’000
----- End of picture text -----

Sir John Morden – Total Return accounting
Balance 1 April 2020
Investment income
Investment gains
Investment Managers' fees
Transfer from Unapplied Total Return
Allocation of Unapplied Total Return to income		 212,766
2,253
215,019
-
3,306
3,306
-
23,881
23,881
-
(294)
(294)
212,766
29,146
241,912
2,979
(2,979)
-
215,745
26,167
241,912
-
(3,306)
(3,306)
Balance at 31 March 2021
College Building Transfer (BBC)
Investment income
Investment gains
Investment Managers' fees
Transfer from Unapplied Total Return
Allocation of Unapplied Total Return to income		 215,745
22,861
238,606
611
-
611
-
10,371
10,371
-
27,473
27,473
-
(1,096)
(1,096)
216,356
59,609
275,965
19,417
(19,417)
-
235,773
40,192
275,965
-
(10,371)
(10,371)
Balance at 31 March 2022 235,773
29,821
265,594

The Trust for Investment as at 1 April 2016, the date of adoption of Total Return accounting, was identified by the Trustees as being equal to the value of the fund’s investment portfolio as at that date. The Trustees have determined that the Trust for Investment should be increased annually in line with RPI inflation to protect its real value, which has resulted in an increase of 9% in the current year (2021: 1.4%).

Morden College Annual Report 2022

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15. RESTRICTED FUNDS – GROUP AND CHARITY

----- Start of picture text -----
Balance at
Balance at 31 March
1 April 2021 Income Expenditure 2022
£’000 £’000 £’000 £’000
----- End of picture text -----

Balance at
1 April 2021
£’000
Income
£’000
Expenditure
£’000
Balance at
31 March
2022
£’000
2022
Welfare Fund
Gift Fund
Dame Susan Morden's Charity general fund
2021
Welfare Fund
Gift Fund
Dame Susan Morden's Charity general fund		 5
-
-
5
5
23
-
28
1,042
487
(276)
1,253
1,052
510
(276)
1,286
6
-
(1)
5
6
-
(1)
5
922
409
(289)
1,042
934
409
(291)
1,052

The Welfare Fund was created from a gift received some years ago and is for the benefit of residents and staff and it is for expenditure that is not part of the Charity’s normal activities. The Gift Fund represents donations received for the benefit of the Care Home and its staff.

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16. UNRESTRICTED FUNDS – GROUP AND CHARITY

----- Start of picture text -----
Balance at
Balance at 31 March
1 April 2021 Income Expenditure Transfers 2022
£’000 £’000 £’000 Gains/Losses £’000 £’000
----- End of picture text -----

Balance at
1 April 2021
£’000
Income
£’000
Expenditure
£’000
Gains/Losses
Transfers
£’000
Balance at
31 March
2022
£’000
2022
General fund
Accumulation of income
Extraordinary repairs
Future projects
2021
General fund
Accumulation of income
Extraordinary repairs
Future projects		 7,023
4,185
(12,554)
167
8,089
6,910
2,307
-
-
-
6
2,313
4,715
-
-
-
(562)
4,153
6,223
-
-
-
(19)
6,204
20,268
4,185
(12,554)
167
7,514
19,580
5,079
11,230
(13,634)
1,013
3,335
7,023
2,301
-
-
-
6
2,307
5,300
-
-
-
(585)
4,715
9,157
-
-
-
(2,934)
6,223
21,837
11,230
(13,634)
1,013
(178)
20,268

The Trustees reviewed the balances on all funds before authorising transfers between funds.

The Trust Deed requires the Trustees to maintain an Accumulation of Income fund to ensure that the fixed overheads of the Charity could be met for a limited period of time if income levels were temporarily insufficient to cover such costs. The Deed also requires a minimum transfer of £6k into this fund each year; having reviewed the balance on the fund the Trustees have determined that the fund should be increased by the minimum amount. The fund is invested in a cash deposit.

Under the Trust Deed the Trustees are also required to maintain an Extraordinary Repairs Fund (Building Reserve Fund) for the maintenance, extraordinary repair, improvement or refurbishment of the almshouses, other buildings and the infrastructure of the Charity. The funds are invested in a bank deposit account.

The Future Projects fund provides for the future expenditure on new projects of any kind to be undertaken in furtherance of the objects of the Charity. The balance of the surplus for the year, after transfers to the Extraordinary Repairs Fund and other Funds has been retained in this account.

The balance of the future projects fund was reduced in year by £19k to cover cost incurred for the JMC project to date. The balance of the extraordinary repairs fund was reduced by £562k to cover the costs of fire safety works enhancements.

Morden College Annual Report 2022

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17. CAPITAL COMMITMENTS

----- Start of picture text -----
2022 2021
£’000 £’000
At 31 March – Contracted - -
– Authorised not contracted - -
----- End of picture text -----

18. SUBSIDIARY UNDERTAKING

The Charity incorporated a Private Limited Company, Morden College Design and Build Limited on 22 January 2013; the company is registered in England and Wales. The company supplied building construction services to Sir John Morden’s Charity for its building project, Alexander Court. The subsidiary has 2 issued shares of £1 each which are both beneficially owned by the Charity.

A summary of the subsidiary’s accounts for the year ended 31 March 2022 is shown below:


project, Alexander Court. The subsidiary has 2 issued shares of £1 each which are both benefcially owned by the
A summary of the subsidiary’s accounts for the year ended 31 March 2022 is shown below:
Charity.
Proft and Loss Account
2022
£’000
2021
£’000
Turnover
Cost of Sales and Operating Expenses
Proft before taxation
Taxation
Proft after taxation
Balance Sheet
Current assets
Current liabilities
Net Assets
Shareholders’ funds		 21
2,448
(11)
(2,423)
10
25
-
-
10
25
12
138
(2)
(113)
10
25
10
25

19. OPERATING LEASES

The Charity derives the majority of its income from properties which are leased to commercial and residential tenants. The future minimum lease payments under non-cancellable operating leases are as follows:

Group & Charity
2022
£’000
2021
£’000
Not later than one year
Later than one year and not later than fve years
Later than fve years		 849
681
29,650
1,122
62,893
97,174
93,392
98,977

Morden College Annual Report 2022

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Morden College Annu31 Report 2022 39

Charity Information

PRINCIPAL OFFICE

19 St Germans Place Blackheath London SE3 0PW

PRINCIPAL BANKERS

National Westminster Bank plc 13 Stratheden Road Old Dover Road, Blackheath London SE3 7SY

CHARTERED SURVEYORS

Gerald Eve LLP 7 Vere Street London W1G 0JB

INVESTMENT ADVISORS

Stanhope Consulting 35 Portman Square London W1H 6LR

AUDITOR

Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG

SOLICITORS

Farrer & Co LLP 66 Lincoln’s Inn Fields London WC2A 3LH

Attwaters Jameson Hill St. Clement’s House 27 Clement’s Lane London EC4N 7AE

INVESTMENT MANAGERS

Investec Wealth & Investment Limited 30 Gresham Street London EC2V 7QW

Sarasin & Partners LLP Juxon House 100 St Paul’s Churchyard London EC4M 8BU

Morden College Annual Report 2022 Annual Report and Consolidated Accounts for the year ended 31 March 2022 Registered Charity No 215551

40

lllll

----- Start of picture text -----
Her late Majesty Queen Elizabeth II was
patron of Morden College 1976-2001.
We were delighted to welcome her
in November 1971 for the unveiling
of the plaque on the opening of
Cullum Welch Court.
----- End of picture text -----

Morden College

19 St Germans Place, Blackheath, London SE3 0PW Registered Charity No 215551

~~www.mordencollege.org.uk~~

Morden College Annual Report 2022

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