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2023-03-31-accounts

Annual Report

Annual Report and Consolidated Accounts for the year ended 31 March 2023

Registered Charity No 215551

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Contents

Morden College Annual Report 2023 Annual Report and Consolidated Accounts for the year ended 31 March 2023 Registered Charity No 215551

Morden College Annual Report 2023

3

Foreword from the Chair of Trustees

In my last foreword, for the Annual Report ending 31 March 2022, I concluded by looking ahead to what we assessed would be a period of consolidation. 2022 was indeed about consolidation, recovery post the pandemic, and settling the College community down after a significant organisational restructure. 2022 was however not without its challenges.

Sir David Wootton MA

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The strategic context for the Charity’s (re)focus last year, and into 2023, lies with decisions made in April 2019 when Trustees agreed the future model for the Charity. Everyone then become distracted, concentrating on both protecting and sustaining our community through the pandemic; nothing agreed in April 2019 was actioned in 2020/21. But the period of crisis did reinforce much of the thinking that led to decisions made by Trustees in 2019. And so, pandemic and restructure behind us, we began in 2022 to concentrate on delivering the following:

I am pleased that in 2022 we did reduce the operating capacity of the Care Home, as planned; and we have begun to look in detail at the additional ‘domiciliary’ support that is needed at the Charity’s second site, Ralph Perring Court. We also in 2022 closed our third site, Broadbridge Close, to use by our older people (because as a listed building we were unable to gain approval to fully modernise the building, including structurally), and, with a smile, we watched as our community began to take full advantage of the Charity’s new facility, the John Morden Centre, with all that the centre offers to their quality of life.

2022 was not without challenges; we were knocked off course to varying degrees by these in particular:

I feel confident about the future. The last 3 years have been challenging and very unsettling for the community. We are, however, on new ground, reorganised, with new facilities, and a clear purpose. The journey towards a smaller almshouse community, balanced by a new nonresidential community based upon a grant giving model, both underwritten (ultimately) by the Charity’s assisted living facility, and a small residential Care Home, continues. Our resident community feels more settled, and the recent reorganisation and restructure is beginning to pay off. New facilities are starting to add significant value, as one resident told us recently, describing our new John Morden Centre as “…above all, a place of healing”.

Finally, I wish to thank my fellow Trustees, our staff and volunteers; and our residents and their families for being understanding throughout what has been a trying few years. The Charity has been under the strong leadership of David Rutherford-Jones since 2011, and particularly so during the pandemic. David is retiring at the end of 2023, and we wish both him and Sarah a long and happy retirement.

We are entering a new era, it feels that way to me, and I believe the future is strong for both Sir John Morden and Dame Susan Morden’s Charities.

Sir David Wootton Chair of Trustees

Morden College Annual Report 2023

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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 twelve 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.

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People

TRUSTEES

Chairman and Honorary Treasurer: Sir David Wootton MA

Trustees: Alderman Sir Peter Estlin FCA BSc (resigned 16 November 2023)

Alderman Sir William Russell (resigned 13 December 2022)

Alderman Professor Michael Mainelli FCCA FCSI FBCS

Alderman Alison Gowman

Alderman Alastair King

Alderman Robert Hughes-Penney (elected 20 March 2023)

Sharon Houlden (elected 13 December 2022, resigned 13 April 2023)

ADVISORS TO THE TRUSTEES

Honorary Surveyor George Gillon MBE FRICS

Advisor on Care Dr Caroline Shuldham OBE

OFFICERS AND SENIOR MANAGERS

Clerk to the Trustees & Chief Executive David Rutherford-Jones CB (retired 13 October 2023)

Meryl Davies (appointed 16 October 2023)

Chaplain The Rev’d William Warren

Finance Director Kate Morris MSc ACMA BA

Director of Real Estate Ed Mileham MRICS BSc

Fredrik Widlund

Dr Abigail Masterson

Director of Health & Wellbeing Debbie Dollner

Director of People & Culture Vickie Sutton CIPD MA BSc (resigned 19 October 2023)

Director of Operations Richard McAllister

Morden College Annual Report 2023

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Trustees’ Report

OUR VISION

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

8

Morden College Annual Report 2023

OUR CULTURE

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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ENCOURAGES AND SUPPORTS CREATIVITY
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CELEBRATES INCLUSION, DIVERSITY, AND EQUALITY
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PROMOTES THE HIGHEST STANDARDS OF LEADERSHIP, INDIVIDUAL BEHAVIOUR, AND ACCOUNTABILITY IN EVERYTHING WE DO.

OUR VALUES

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

Respectful

We celebrate individuality and diversity and foster a culture of dignity where everyone feels safe and valued. We appreciate the different roles we each perform in strengthening our culture and making a positive impact on people’s lives within Morden College.

Compassionate

We are kind to each other. We create and nurture a supportive, inclusive environment where voices are heard, and individual choices are respected. We genuinely care for our colleagues, our residents, and their families.

Progressive

We believe in everyone’s abilities and provide our people with opportunities to grow personally and professionally. We inspire each other to improve as individuals and as a community, and we encourage creativity and embrace new ideas.

We value education and develop our talent. We embrace technology and through collaboration, communication and teamwork we progress as individuals, and contribute to the long-term performance of the Charity.

Accountable

We encourage the highest standards of individual behaviour in all that we do. We are personally accountable for our choices and our actions and are fully committed to the Charity’s mission and its successes.

Morden College Annual Report 2023

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Trustees’ Report continued

OUR STRATEGIC AIMS

Five Strategic Aims guide the Charity

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1 2 3 4 5
Enable a life lived Provide care Grow the College Sustain Create a performance
in independence through life until community into our Sir John Morden’s focussed culture,
for the older the end of life local community, Charity for where every member
people we provide for our resident creating a new another of staff understands
homes for. beneficiaries. non-residential 300 years. their contribution
beneficiary to the success of
community locally. Morden College,
and is provided with
the opportunity
to achieve their
potential.
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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

There are a number of improvements underway in the regulated businesses (CWC and Domiciliary Care) that have been taking place in 2022/23 and will continue in 2023/24 to ensure appropriate administrative and procedural structures / procedures and monitoring and recording of these are in place. Our ambition is both regulated services will be regraded Good and Good in each of the 5 disciplines, within 1-2 years.

In addition, it is planned there will be a considerable investment in employee skills and knowledge. Increasing the capabilities and knowledge/experience of our employees will deliver a better standard of care to Residents.

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AT A GLANCE – 2023/2024/2025 PRIORITIES

Continue to regain (post pandemic) the community’s spirit and
residents’ sense of fun.
Defne a ‘Good Life’ for older people at Morden College, so they live
well for longer.
Develop a new approach to training and developing staf. This includes
mandatory training, professional training and development that not
only assists an employee in their work at Morden College, but also
equips them for the future. Continue to evolve the culture at Morden
College, and embed good performance management.
Sir John Morden’s Charity Plan for execution of Strategic Aim 3.
Objective Reduce the requirement for residential based personal care
without nursing.
Establish an ‘Income Strategy’ for Sir John Morden’s Charity. The aim is
sustain a level of income that matches the operating costs of running
the Charity, and our ambition, for the long term.
Develop plans that will enable the Charity to meet and sustain its
Environmental targets; and articulate in greater details how the Charity
meets both Social and Governance standards.
Continue to develop the Charity’s use of technology to further business
efciency; and also to enable the Good Life agenda for our residents.
Continue to underwrite the costs of an active Chaplaincy at Morden
College in the tradition of the Anglican Church. Provide a Ministry at
Morden College to those who need it, and provide pastoral care to the
Community, for those of all faiths or none, both at the Blackheath site
and at Ralph Perring Court.
Maintain investment properties to continue providing a valuable
income source for the Charity. Guided by the 10 year plan, the
Dame Susan Morden’s Charity
Objective		 investment properties provided by Dame Susan Morden are to be
maintained to a high standard, continue to be occupied and provide
a good market rental yield.

Dame Susan Morden’s Scheme has been revised and approved by the Charity Commission. This new grant giving business is in addition to, not replacing, grants given by Dame Susan. The Trustees have approved the new Scheme, a policy document will be produced which describes Dame Susan’s operations and processes that support this; including the establishment of a new Morden College Grants Committee.

Morden College Annual Report 2023

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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 £467k compared to a £205k surplus for the previous year. With income marginally increased but costs also increased, an impact of the war in Ukraine and political/ economic disruption in the UK, this was a year financially of trying to keep costs down alongside making progressive decisions in terms of the operation of the Charity.

Contributions from beneficiaries in our living accommodation (including the care home) this year were £3.126 million, a decrease of 13% compared to the previous year (2022: £3.599 million).

This decrease is as a result of deliberately reducing the number of beneficiaries in the care home in order to make the operation smaller, only operating it to serve current residential beneficiaries. Filling voids in our Independent Living accommodation has also been challenging, as ever.

INCOME 2023

Total income for the year was

£15.662m

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+ 4% increase
2023 £15.662 million
2022 £15.066 million
3%
15%
20%
62%
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Income from the Charity’s Quoted Investment Portfolio was £2.386 million, an increase of 7% versus the previous year.

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

CHARITABLE ACTIVITIES INVESTMENT INCOME FROM PROPERTY INVESTMENT INCOME FROM OTHER INVESTMENTS OTHER INCOME INCLUDING DONATIONS

Morden College Annual Report 2023

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EXPENDITURE 2023

Total expenditure for the year was

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£15.195m
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+ 2% increase
2023 £15.195 million
2022 £14.861 million
2%
10%
7%
2%
2%
34%
GRANTS AND OUT/IN PENSIONS
INDEPENDENT LIVING HOUSING COSTS
CARE HOME COSTS
FIRE SAFETY ENHANCEMENT WORKS
INVESTMENT MANAGERS’ FEES
BOND INTEREST
PROPERTY MANAGEMENT
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43%
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(2) Independent Living Housing Costs (including the Quadrangle) Independent living costs at £6.619 million show an increase of 18% compared to the previous year (2022: £5.61 million).

2023 was another high cost year for the College in terms of maintenance of the estate and improvements to our IT infrastructure and systems, and also investment in our HR/People function.

We also, from 1 April 2022, increased pay for all at 3 – 4% (and 5% from 1 April 2023). All staff receive the London Living Wage or above. Staff who earned £40,000 or under also received a one-off cost of living payment of £1,000 in December 2022.

Care Home costs are reduced, £5.165 million in 2023 versus £6.124 million in 2022. The staffing structure now reflects the reduced number of residents, and the costs associated with restructuring were paid in the previous year.

At £1.457 million the costs associated with our direct property investments have increased this year (2022: £897k), there has been more activity, and 10% higher income, there also 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.

Morden College Annual Report 2023

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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 two Charities are now valued at £296 million. The permanent endowment assets include total College fixed assets, which includes the original land, investment properties and quoted investments.

Approximately 73% of the Charity’s endowment is invested in property (including property funds) and 27% 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 1 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 CPI inflation to protect its real value, which has resulted in an increase of 8.9% in the current year (2022: 6.2%).

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 2023 was a gain of £7.7 million comprising income of £11.1 million and losses of £1.8 million, less investment management costs of £1.6 million. The balance of the Unapplied Total Return Fund at 31 March 2022 was £29.821 million and it is proposed that £9.128 million is allocated to the Trust for investment, in line with the Trustees’ policy established in 2017, and £11.136 million is converted to income and transferred to the unrestricted fund. The balance on the Unapplied Total Return Fund at 31 March 2023 is now £17.28 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

• Other Financial Investments

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.

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

– Public relations affecting

reputation, growing the Charity’s reputation locally as a priority. Specifically, this year, as the Charity anticipates selling our Morden Wharf interest, Trustees have sought advice and support from a third party professional in terms of the relative communications.

– Generating sufficient income

and managing a rising cost base,

so that we are able to sustain our operations and deliver our ambition for the future; in particular restoring investment income levels lost to the pandemic crisis and identifying new sources of income. The Charity budgets in detail each year, for the next three-year period and the Asset Allocation Committee considers the relative returns on our investments and whether we may need to liquidate any of the Unapplied Total Return fund to support current operations.

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.

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:

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

– Require the College’s investment fund managers to uphold the United Nations Principles for Responsible Investment (UNPRI), and to follow the UNPRI principles in the way they operate and invest the College’s financial resources, including that they (the College’s investment fund managers) promote sustainability, good business ethics, good employment practices and the transition to a low carbon economy.

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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 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 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 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.

Sir David Wootton MA Chair of the Trustees

Meryl Davies Clerk to the Trustees & Chief Executive 19 January 2024

Morden College Annual Report 2023

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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 2023 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 forward from the Chair of Trustees, History and Constitution, People and 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:

Morden College Annual Report 2023

20

Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement set out on page 19, 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, Tenancy Laws, Health and Safety Regulations, Charity Law, GDPR and Employment 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 and payroll taxes.

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: 25 January 2024

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

Morden College Annual Report 2023

21

Consolidated Statement of Financial Activities

for the year ended 31 March 2023

----- Start of picture text -----
Unrestricted Restricted Permanent Total Total
Funds Funds Endowment 2023 2022
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
(losses)/gains
Net (losses)/gains on investments		 3,126
-
-
3,126
3,599
419
433
8,900
9,752
8,864
3
113
37
2,236
2,386
2,237
4
386
12
-
398
366
2
4,044
482
11,136
15,662
15,066
5a
11,234
184
977
12,395
12,596
5b
1,021
193
1,586
2,800
2,265
2
12,255
377
2,563
15,195
14,861
(8,211)
105
8,573
467
205
9c
(56)
-
(1,865)
(1,921)
28,362
Net income/(expenditure)
Transfer between funds
Net movement in funds
Reconciliation of funds
Total funds brought forward at 1 April 2022		 (8,267)
105
6,708
(1,454)
28,567
6,353
-
(6,353)
-
-
(1,914)
105
355
(1,454)
28,567
19,580
1,286
295,589
316,455
287,888
Total funds carried forward at 31 March 2023 17,666
1,391
295,944
315,001
316,455

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.

Morden College Annual Report 2023

22

Group and Charity Balance Sheets

for the year ended 31 March 2023

----- Start of picture text -----
Group Group Charity Charity
2023 2022 2023 2022
Notes £’000 £’000 £’000 £’000
----- End of picture text -----

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
35,076
34,561
35,719
35,204
8
3,713
2,431
3,713
2,431
38,789
36,992
39,432
37,635
9
214,148 210,116
214,148 210,116
9
80,796
86,639
80,796
86,639
294,944296,755
294,944296,755
333,733333,747
334,376334,390
10
1,366
898
1,352
888
9,581
8,729
9,582
8,729
3,633
5,734
3,632
5,732
14,580
15,361
14,566
15,349
11
(3,312)
(2,653)
(3,298)
(2,641)
11,268
12,708
11,268
12,708
12
(30,000)
(30,000)
(30,000)
(30,000)
315,001316,455
315,644317,098
13, 14
275,326 275,108
275,969 275,751
20,618
20,481
20,618
20,481
13, 15
1,391
1,286
1,391
1,286
13, 16
17,666
19,580
17,666
19,580
315,001316,455
315,644317,098

The financial statements on pages 22 to 40 were approved and authorised for issue by the Board of Trustees and signed on 19 January 2024 on its behalf by:

Sir David Wootton MA Chairman of the Trustees

Meryl Davies Clerk to the Trustees & Chief Executive

Morden College Annual Report 2023

23

Consolidated Statement of Cash Flows

for the year ended 31 March 2023

----- Start of picture text -----
Group Group
2023 2022
Notes £’000 £’000
Cash flow from operating activities
Net cash provided/(used) in operating activities A (10,359) (10,110)
Cash flow from investment activities
Dividend, interest and rents from investments 12,138 11,101
Proceeds from the sale of investments 31,473 31,370
Purchase of investments (31,578) (31,188)
Purchase of tangible fixed assets (2,923) (783)
9,110 10,500
Change in cash and cash equivalents in the reporting period (1,249) 390
Cash and cash equivalents at the beginning of the reporting period 14,463 14,073
Cash and cash equivalents to the end of the reporting period B 13,214 14,463
2023 2022
A. Reconciliation of net income to net cash flow from operating activities £000 £000
Net income for the reporting period (1,454) 28,567
Adjustments for
Depreciation charges 1,123 1,139
(Gains)/losses on investments 1,921 (28,362)
Dividends, interest and rents from investments (12,138) (11,101)
(Increase)/decrease in debtors (470) 150
Increase/(decrease) in creditors 659 (503)
(Increase)/decrease in work in progress - -
Net cash used in operating activities (10,359) (10,110)
B. Analysis of cash and cash equivalents
Cash in hand 3,633 5,734
Notice deposits (less than 3 months) 9,581 8,729
Total cash and cash equivalents 13,214 14,463
C. Cashflow Net Debt
At 1 At 31
April 2022 Cashflows March 2023
£'000 £'000 £'000
Cash in hand 5,734 (2,101) 3,633
Notice deposits 8,729 852 9,581
Sub-total 14,463 (1,249) 13,214
Long-term bond (30,000) - (30,000)
Net debt (15,537) (1,249) (16,786)
----- End of picture text -----

Morden College Annual Report 2023

24

Notes to the Accounts

for the year ended 31 March 2023

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 judgements and sources of estimation uncertainty relate to the valuation of investment properties and the estimated useful lives of tangible fixed assets.

Income

Morden College Annual Report 2023

25

Expenditure

Investment property

The Charity’s Commercial investment properties were last professionally valued by Messrs Gerald Eve LLP, Chartered Surveyors, as of 31 March 2023 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 Comber & Co, as of 31 March 2023 on an open market basis in accordance with the Royal Institution of Chartered Surveyors Valuation Professional Standards.

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

Freehold land is not depreciated.

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

Morden College Annual Report 2023

26

Major components

Furniture and equipment 5 years Computers 4 – 7 years

Grants

Grants payables 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 (2022: 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:

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.

Morden College Annual Report 2023

27

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 2022
£’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
Net gains on investments
Net income/(expenditure)
Transfer between funds
Net movement in funds
Reconciliation of funds
Total funds brought forward at 1 April 2021
Total funds carried forward at 31 March 2022		 3,599
-
-
3,599
253
440
8,171
8,864
-
37
2,200
2,237
333
33
-
366
4,185
510
10,371
15,066
11,531
125
940
12,596
1,023
151
1,091
2,265
12,554
276
2,031
14,861
(8,369)
234
8,340
205
167
-
28,195
28,362
(8,202)
234
36,535
28,567
7,514
-
(7,514)
-
(688)
234
29,021
28,567
20,268
1,052
266,568
287,888
19,580
1,286
295,589
316,455

Morden College Annual Report 2023

28

3. INVESTMENT INCOME

----- Start of picture text -----
2023 2022
£’000 £’000
----- End of picture text -----

2023
£’000
2022
£’000
Dividends and income from Investments
Interest on Cash Deposits		 2,273
2,209
113
28
2,386
2,237

4. OTHER INCOME

----- Start of picture text -----
2023 2022
£’000 £’000
----- End of picture text -----

2023
£’000
2022
£’000
Benefciary restaurant receipts and sundry income
COVID-19 funding
Dame Susan Morden’s Charity		 386
255
-
101
12
10
398
366

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
2023
Grants and out/in pensions
Independent living housing costs
Quadrangle housing costs
Care home costs
Morden College Chapel costs
Fire safety enhancement works
2022
Grants and out/in pensions
Independent living housing costs
Quadrangle housing costs
Care home costs
Morden College Chapel costs
Fire safety enhancement works		 -
251
25
276
439
1,011
2,184
3,634
131
260
2,594
2,985
1,210
501
3,454
5,165
63
12
-
75
-
260
-
260
1,843
2,295
8,257
12,395
-
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

Morden College Annual Report 2023

29

Direct
Staf
Costs
£’000
Other
Costs
£’000
Apportioned
costs
£’000
Total
£’000
b. Cost of raising funds
2023
Quoted Investment Managers’ fees
Bond Interest
Property Management
2022
Quoted Investment Managers’ fees
Bond interest
Property management		 -
322
-
322
-
1,021
-
1,021
-
1,448
9
1,457
-
2,791
9
2,800
-
345
-
345
-
1,023
-
1,023
-
746
151
897
-
2,114
151
2,265
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
2023
Catering
-
-
Restaurant
-
172
Library & Muniments
-
4
Gardens
-
10
Administration
25
1,998
25
2,184
2022
Catering
-
-
Restaurant
-
63
Library & Muniments
-
7
Gardens
-
145
Administration
25
1,254
25
1,469		 200
342
-
542
-
-
-
172
5
-
-
9
21
3
-
34
2,368
3,110
9
7,510
25
2,184		 2,594
3,455
9
8,267
-
-
-
63
-
7
-
145
25
1,254		 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

Morden College Annual Report 2023

30

6. PAYMENT OF OUT/IN PENSIONS

2023
£’000
2022
£’000
Individuals (Pensioners)
Administrative costs		 122
131
25
25
147
156

There were 82 pensioners at 31 March 2023 (2022: 92)

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

----- Start of picture text -----
2023 2022
£’000 £’000
----- End of picture text -----

Staf costs
Wages and salaries
Social security costs
Pension contributions
Other costs including bank and agency staf		 4,623
5,208
479
547
235
272
925
447
6,262
6,474

Staff costs – Wages and Salaries include redundancy cost of £19k (2022: £279k)

Staff numbers

The average number of employees during the year including those who worked part-time was 172 (2022:161). Their full time equivalent was 154 (2022: 144) and their functional analysis was as follows:

2023
No.
2022
No.
Kitchen and domestics
Nursing
Premises, grounds and security
Home management and pastoral
Management and administration		 39
36
56
57
14
12
3
2
42
37
154
144
2023
2022
Highest paid employees, including benefts, excluding pensions
£60,000 to £70,000
£80,001 to £90,000
£90,001 ro £110,000
£110,001 ro £120,000
£120,001 to £130,000
£130,001 to £140,000
£140,001 to £150,000		 6
7
1
1
1
2
1
0
1
1
0
1
1
0

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 £1,059k (2022: £994k).

No Trustees received any remuneration but received reimbursement of expenses of £1,889 during the year (2022: £1,553).

Morden College Annual Report 2023

31

8. TANGIBLE FIXED ASSETS

Group
£’000
Charity
£’000
Charitable Buildings
Cost
At 1 April 2022
Additions at cost
At 31 March 2023
Depreciation
At 1 April 2022
Charge for the year
At 31 March 2023
Net book value at 31 March 2023
Net book value at 31 March 2022		 45,051
45,694
1,435
1,435
46,486
47,129
10,490
10,490
920
920
11,410
11,410
35,076
35,719
34,561
35,204
Antiques &
Valuables
£000
Computers
£’000		 Furniture &
equipment
£’000
Total
£’000
Other fxed assets – Group and Charity
Cost or Valuation
At 1 April 2022
Additions at cost
Disposals/scrapped
At 31 March 2023
At valuation
At cost
Depreciation
At 1 April 2022
Disposals/scrapped
Charge for the year
At 31 March 2023
Net book value at 31 March 2023
Net book value at 31 March 2022		 1,688
629
-
1,108
(3)
-		 2,106
4,423
380
1,488
-
(3)
1,685
1,737		 2,486
5,908
1,685
-
-
1,737
-
258
-
-
-
121		 -
-
2,486
5,908
1,734
1,992
-
-
82
203
-
379		 1,816
2,195
1,685
1,358		 670
3,713
1,688
371		 372
2,431

Morden College Annual Report 2023

32

9. INVESTMENT ASSETS AT MARKET VALUE

----- Start of picture text -----
2023 2022
£’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 2023		 64,167
58,356
149,981
151,760
214,148
210,116
14,572
12,368
63,266
71,949
77,838
84,317
2,958
2,322
80,796
86,639
86,639
85,234

----- 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 2022
Realised/Unrealised gains/(losses)
Additions
Disposals
Change in stockbroker cash deposits
Market value at 31 March 2023		 210,119
86,639
296,755
3,595
(5,516)
(1,921)
213,714
81,123
294,837
3,691
27,887
31,578
(3,257)
(29,748)
(33,005)
1,534
1,534
214,148
80,796
294,944

Within the Investment Property, Commercial and Industrial number is a valuation of £49.9m (£9.55m N and £40.35m S) 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.

Morden College Annual Report 2023

33

10. DEBTORS

----- Start of picture text -----
Group Charity
2023 2022 2023 2022
£’000 £’000 £’000 £’000
----- End of picture text -----

Rent and contributions receivable
Bad Debt Provision
Prepayments and sundry debtors
Dividends and interest receivable
Due from subsidiary undertaking		 527
239
527
239
(66)
-
(66)
-
546
447
532
437
357
210
357
210
2
2
2
2
1,366
898
1,352
888

11. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

----- Start of picture text -----
Group Charity
2023 2022 2023 2022
£’000 £’000 £’000 £’000
Advance rents received 1,294 1,264 1,294 1,264
Tax, pensions and social security 147 148 147 148
Value Added Tax 221 246 221 246
Sundry creditors 1,080 715 1,066 703
Accruals 570 280 570 280
3,312 2,653 3,298 2,641
----- End of picture text -----

12. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

Group
Charity
2023
£’000
2022
£’000
2023
£’000
2022
£’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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34

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

Endowment
Funds
£’000
Restricted
Funds
£’000
Unrestricted
Funds
£’000
Total
Funds
£’000
Group 2023
College buildings
Other tangible fxed assets
Investments – Sir John Morden
Investments – Dame Susan Morden
Net current assets
Long-term liability (Bond)
Group 2022
College buildings
Other tangible fxed assets
Investments – Sir John Morden
Investments – Dame Susan Morden
Net current assets
Long-term liability (Bond)		 35,076
-
-
35,076
1,688
6
2,019
3,713
262,180
-
12,146
274,326
20,618
-
-
20,618
6,382
1,385
3,501
11,268
(30,000)
-
-
(30,000)
295,944
1,391
17,666
315,001
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
Endowment
Funds
£’000
Restricted
Funds
£’000
Unrestricted
Funds
£’000
Total
Funds
£’000
Charity 2023
College buildings
Other tangible fxed asset
Investments – Sir John Morden
Investments – Dame Susan Morden
Net current assets
Long-term liability (Bond)
Charity 2022
College buildings
Other tangible fxed assets
Investments – Sir John Morden
Investments – Dame Susan Morden
Net current assets
Long-term liability (Bond)		 35,719
-
-
35,719
1,688
6
2,019
3,713
262,180
-
12,146
274,326
20,618
-
-
20,618
6,383
1,385
3,501
11,269
(30,000)
-
-
(30,000)
296,588
1,391
17,666
315,645
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

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35

14. PERMANENT ENDOWMENT FUNDS

Balance at
1 April 2022
£’000
Income
£’000
Expenditure
£’000
Gains/
(losses)
£’000
Transfers
£’000
Balance at
31 March
2023
£’000
Group 2023
Sir John Morden
Dame Susan Morden
Group 2022
Sir John Morden
Dame Susan Morden		 275,108
11,136
(2,567)
(1,822)
(6,529)
275,326
20,481
-
4
(43)
176
20,618
295,589
11,136
(2,563)
(1,865)
(6,353)
295,944
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
Balance at
1 April 2022
£’000
Income
£’000
Expenditure
£’000
Gains/
(losses)
£’000
Transfers
£’000
Balance at
31 March
2023
£’000
Charity 2023
Sir John Morden
Dame Susan Morden
Charity 2022
Sir John Morden
Dame Susan Morden		 275,752
11,136
(2,567)
(1,822)
(6,529)
275,970
20,481
-
4
(43)
176
20,618
296,233
11,136
(2,563)
(1,865)
(6,353)
296,588
247,458
10,371
(2,036)
27,473
(7,514)
275,752
19,754
-
5
722
-
20,481
267,212
10,371
(2,031)
28,195
(7,514)
296,232

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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36

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 2021
College Building Transfer (BBC)
Investment Income
Investment Gains
Investment Managers' Fees
Infation Indexation
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
Investment Income
Investment Gain
Investment Managers' Fees
Infation Indexation
Allocation of Unapplied Total Return to income		 235,773
29,821
265,594
-
11,136
11,136
-
(1,822)
(1,822)
-
(1,592)
(1,592)
235,773
37,543
273,316
9,128
(9,128)
-
244,901
28,415
273,316
-
(11,136)
(11,136)
Balance at 31 March 2023 244,901
17,279
262,180

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 CPI inflation to protect its real value, which has resulted in an increase of 8.9%, £9.128m in the current year (2022: 6.2%).

Source: Office for National Statistics

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37

15. RESTRICTED FUNDS – GROUP AND CHARITY

----- Start of picture text -----
Balance at
Balance at 31 March
1 April 2022 Income Expenditure 2023
£’000 £’000 £’000 £’000
----- End of picture text -----

Balance at
1 April 2022
£’000
Income
£’000
Expenditure
£’000
Balance at
31 March
2023
£’000
2023
Welfare Fund
Gift Fund
Dame Susan Morden's Charity general fund
2022
Welfare Fund
Gift Fund
Dame Susan Morden's Charity general fund		 5
-
-
5
28
-
(20)
8
1,253
482
(357)
1,378
1,286
482
(377)
1,391
5
-
-
5
5
23
-
28
1042
487
(276)
1,253
1052
510
(276)
1,286

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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38

16. UNRESTRICTED FUNDS – GROUP AND CHARITY

----- Start of picture text -----
Balance at
Balance at 31 March
1 April 2022 Income Expenditure Transfers 2023
£’000 £’000 £’000 Gains/Losses £’000 £’000
----- End of picture text -----

Balance at
1 April 2022
£’000
Income
£’000
Expenditure
£’000
Gains/Losses
Transfers
£’000
Balance at
31 March
2023
£’000
2023
General fund
Accumulation of income
Extraordinary repairs
Future projects
2022
General fund
Accumulation of income
Extraordinary repairs
Future projects		 6,910
4,044
(12,255)
(56)
6,607
5,250
2,313
-
-
-
6
2,319
4,153
-
-
-
(260)
3,893
6,204
-
-
-
-
6,204
19,580
4,044
(12,255)
(56)
6,353
17,666
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

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 extraordinary repairs fund was reduced by £260k to cover the costs of fire safety enhancement works.

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39

17. CAPITAL COMMITMENTS

----- Start of picture text -----
2023 2022
£’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 2023; 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 2023 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 2023 is shown below:
Charity.
Proft and Loss Account
2023
£’000
2022
£’000
Turnover
Cost of Sales and Operating Expenses
Loss before taxation
Taxation
Loss after taxation
Balance Sheet
Current assets
Current liabilities
Net Assets
Shareholders’ funds		 -
21
(1)
(11)
(1)
10
-
-
(1)
10
15
12
(16)
(2)
(1)
10
(1)
10

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
2023
£’000
2022
£’000
Not later than one year
Later than one year and not later than fve years
Later than fve years		 866
849
25,216
29,650
38,293
62,893
64,375
93,392

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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

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

CCLA Investment Management 1 Angel Lane London EC4R 3AB

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

Morden College Annual Report 2023

42

Morden College Annual Report 2023 Annual Report and Consolidated Accounts for the year ended 31 March 2023 Registered Charity No 215551

----- Start of picture text -----
In May 2023, we were honoured with
a Royal visit from our Patron,
Her Royal Highness the Duchess of Edinburgh.
----- End of picture text -----

Morden College

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

~~www.mordencollege.org.uk~~

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