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2021-03-31-accounts

BRIDGE ESTATE ANNUAL REPORT 2020/21

BRIDGE ESTATE

ANNUAL REPORT

for the year ended 31 March 2021

Registered Charity Number: 220716

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BRIDGE ESTATE ANNUAL REPORT 2020/21

CONTENTS

Page Details

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BRIDGE ESTATE ANNUAL REPORT 2020/21

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31ST MARCH 2021

The trustees present their annual report and financial statements of the charity for the year ended 31st March 2021. The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the accounts and comply with the charity’s trust deed, 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 Standards applicable in the UK and Republic of Ireland.

OBJECTIVES AND ACTIVITIES FOR THE PUBLIC BENEFIT

The maintenance and repair of Trent Bridge and approaches remains the primary objective of the charity. Trent Bridge is the major vehicle communication route from the south of the City and is critical in bringing economic benefit to the City. This is increasingly important in light of the downturn in the global and national economy. The bridge is open to the public at large, assuring public benefit on an open access basis. There are no restrictions regarding the members of the public who may use the bridge and no fees are charged.

The Trustees’ Annual Report for the year ending 31 March 2021 confirms that any residual income would be applied to the improvement of the City of Nottingham in support of the Council’s aims and objectives, as set out in the Council Plan and Medium Term Financial Strategy. This is delivered through the maintenance and protection of the Trust’s portfolio of income producing assets.

The surplus income generated by the charity is transferred to Nottingham City Council’s (NCC) General Fund and is used for the benefit of the citizens of Nottingham. As referred to above, the surplus contributes directly to the delivery of Nottingham’s priorities as set out in the Council Plan and enables the Council to provide the citizens of Nottingham with effective and efficient services.

The Bridge Estate fixed asset portfolio will be actively managed to secure new investment properties, increase income and reduce risk in an uncertain market.

The Bridge Estate’s transfer to NCC’s General Fund also represents an equivalent saving for Nottingham citizens who pay council tax on a Band D property of £18.29 (£22.95 2019/20).

The trustees confirm that they have referred to the Charity Commission’s guidance on public benefit when reviewing the Trust’s aims and objectives.

Objectives

The initial sole objective of the Bridge Estate was the provision of funds for the maintenance and repair of Trent Bridge. However, by the late nineteenth century the income generated by the Estate was in excess of that required for maintenance of Trent Bridge and consequently the objectives of the Estate were extended by virtue of section 78 of the Nottingham Corporation Act 1882.

The Bridge Estate’s charitable objectives are now threefold:

  1. To provide for the efficient maintenance and repair of Trent Bridge and the approaches to it.

  2. To provide a contingency fund for the possible construction of such new bridge or bridges over the River Trent as may be found necessary or desirable.

  3. To apply the residue of any income as the trustees thinks best for the improvement of the City of Nottingham and the public benefit of its inhabitants.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Main objectives for the financial year 2021/22 -

  1. To ensure the necessary financial provision is available if required to provide a vehicle and pedestrian communication link for the City of Nottingham via Trent Bridge.

  2. Surplus revenue generated by the Charity to be invested through NCC to support the City Council’s aims and objectives for the city as set out in the Council Plan and the Medium Term Financial Strategy.

  3. The continued development of the Trust’s property portfolio with a view to minimizing the risk of exposure to adverse economic conditions and protecting and increasing its income and capital value of its assets.

Strategies adopted in the management of the property portfolio

The Bridge Estate’s stated objectives of setting up a contingency fund for the maintenance and repair of Trent Bridge and to accumulate a fund to build a new bridge, should this be necessary, is effectively met by the management of the property portfolio. In practice, although properties could either be sold or mortgaged to fund such expenditure, the current local government context means that there are more efficient and effective ways of raising the funds required to maintain or to replace Trent Bridge. NCC is able to earmark funds from the Local Transport Plan for this purpose and substituting Bridge Estate funds would unnecessarily run down the value of the portfolio. Trent Bridge forms part of the adopted highway network, with maintenance and repairs overseen by the Highway Authority, with the Bridge Estate providing funds as necessary for the carrying out of these works.

Funds generated by the Bridge Estate holding, either through day-to-day operations or sale/mortgage would, in this context, only be applied where other funding routes have been exhausted. For the latter option, Trustees recognise that the ability to generate the level of sales required to replace the Trent Bridge would be difficult to achieve in the short-term and in any case could not meet the full cost of replacing the structure – further confirming the need of working, where possible, within the current local government financial context. There is a further restriction on the ability to generate funds in this way through the possibility that historic restrictions on the disposal of specific ‘endowed’ properties may exist.

The property portfolio includes a number of commercial properties including: retail; office; industrial; ground leases; agricultural holdings; and a miscellaneous range of other properties.

Investment risk whilst held in a single investment class (except money held on interest awaiting reinvestment) is in effect spread through the diverse range of property type, location and tenure.

To maximise return on investment, the Charity is obliged to let properties at full market rent and lettings on full repairing and insuring terms where it is practical to do so. In the case of multi occupied premises where the landlord is responsible for external repairs, heating, cleaning common parts, insurance etc., the costs are generally recovered by way of additional service charge.

The rents of properties leased for a term of years are reviewed in accordance with the terms of the agreement and current market conditions and short term ‘periodic’ tenancies are generally reviewed every 3 years. In the case of expiring leases, these are either renewed on negotiated terms or marketed for re-letting where the original lessee does not wish to continue. In all cases, terms will be negotiated to secure the best outcome for the Charity including where possible an increased rent unless there are other objectives that the Trustees wish to secure.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

ACHIEVEMENTS and PERFORMANCE

The sole activity of the Bridge Estate is investing, through property ownership, to generate income that is utilised for the objectives of the Charity and to increase rental income and to grow the capital value of its assets, to further the charitable purposes to maintain Trent Bridge and for the benefit of the citizens of Nottingham. Strategic Assets and Property, a division of NCC’s Development and Growth Department, manage the property portfolio on behalf of Bridge Estate. A dedicated Chartered Surveyor is assigned to this role.

In summary, the following has been undertaken over the past 12 months:

There is an ongoing review of the portfolio to identify older assets held by the Trust which could be sold and generate investment capital. Should disposals be approved by the Trustees, total capital reserves will provide the Trust with the opportunity to secure positive reinvestment in the portfolio, either through the acquisition of new assets or the improvement or refurbishment of existing properties.

The Strategic Property service has continued to secure tenant demand for investment properties, although in common with the market generally, there has been little by way of rental growth during the last year. The policy remains, however, to achieve market rates for rental, ensuring the charity receives value for money.

FINANCIAL REVIEW

The financial statements of the Bridge Estate are included in the following pages. The statements include comparative figures for the previous year and consist of the following:

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BRIDGE ESTATE ANNUAL REPORT 2020/21

The Trustees confirm that the Trust’s assets are available and adequate to fulfill the obligations of the Trust. Nottingham City Council is required to publish International Financial Reporting Standards (IFRS) compliant accounts. The Bridge Estate forms part of NCC’s Group Accounts, and therefore the accounts have been consolidated on this basis. No adjustments were required to these accounts upon consolidation.

Covid-19 Pandemic

The Government declared a public health emergency on 16th March 2020 and enacted legislation to regulate society and help the country weather the impact of the pandemic and lead to recovery. This legislation was in place for the whole of 2020/21 in various forms with measures changing in line with the scale and effects of the pandemic.

Bridge Estate has sufficient reserves to cover any short-term effects of Covid-19, any longer term impact from Covid-19 could reduce the Charity’s annual surplus which will mean that the amount transferred to NCC’s General Fund will be reduced accordingly.

Policy on reserves

The Charity may hold reserves or funds to even out the financial impact of significant costs for any particular year. The Charity’s objectives state that any residue of any income should be used for the improvement of the City of Nottingham and the public benefit of its inhabitants, therefore any remaining surplus of income over expenditure during the year is transferred to NCC’s General Fund.

The actual Surplus transferred was £1,545,000 for 2020/21 (£1,545,000 2019/20). Further details on reserves can be found in the notes to the accounts.

Investment Policy

The Investment Policy is to seek to achieve an absolute return over the long term in order to meet increases in expenditure and maintain the Trust’s fund in real terms. Any funds generated by the sale of property are temporarily invested until a new investment opportunity is identified by the property manager, in consultation with the Trusts and Charities Committee. When investing surplus Bridge Estate Funds, NCC adhere to their Investment Strategy which complies with the Local Government Act 2003 in support of obtaining the best yield for the Trust.

Risk Management

The Bridge Estate adopts the NCC’s Risk Management Policy, tailored as appropriate for the Trust. The Trustees are committed to a programme of risk management to protect the Charity’s assets. A Risk Register is held which identifies the key risks and the measures in place to mitigate such risks. Procedures are also in place to ensure that appropriate advice and support is provided to Trusts and Charities Committee as and when required.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Review of financial position

Below is a summary of the income generated and resources expended:

2020/21 2019/20
(£) (£)
INCOMING RESOURCES (2,147,027) (2,390,780)
RESOURCES EXPENDED
Surplus transferred to NCC General Fund 1,545,000 1,545,000
Raising Funds 127,258 254,874
Charitable Activities 835,081 168,278
Other 60,844 65,713
Increase / (Decrease) in Loss Allowance 121,603 68,380
Net Contribution to/ (from)reserves (542,759) 288,535
2,147,027 2,390,780

PLANS FOR FUTURE PERIODS

A property investment portfolio is a dynamic resource and needs to be actively managed if it is to develop and resist the effects of economic change. The principal focus should be on proactive management of the portfolio’s income profile, maximising income from existing properties, acquiring prime assets in favour of secondary stock where possible and developing a mix of investments aimed at creating stability, secure income, capital and revenue growth and minimised risk.

The current portfolio includes some of these elements:

In recent years the Portfolio has been partially rebalanced with the disposal of a number of management intensive, low income producing assets and the acquisition of two prime investments. In times of economic recession, the portfolio will still be susceptible to loss of income through a stagnated rental market and the risk of voids but the range of investments helps to mitigate this risk.

The Trust holds some good quality assets evidenced by the Alexander Fleming Building at the Nottingham Science Park, retail premises on Lister Gate/Wheeler Gate and offices at Century House on Chapel Bar and Castle Marina.

The strategy is based on the following principles:

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BRIDGE ESTATE ANNUAL REPORT 2020/21

increased income or maintain income otherwise at risk. This might include the refurbishment of offices or workspace or buying in leasehold interests to provide an asset that is more attractive to a potential tenant.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Organisational structure of the charity

Bridge Estate is a charity of which NCC elected members are representing the Council as sole trustee of the Bridge Estate Charity.

All transactions relating to the Bridge Estate are subject to the same Financial Regulations and procedures as those relating to land and property held by NCC. The Annual Report and Financial Statements are reported to and approved by Councillors of the Trusts and Charities Committee each year.

Governing document

Royal Charter Dated 21 February 1551.

The earliest mention discovered of the Bridge Estate is in 1302. From that date various bequests of land and property were made, the income from which was devoted to the maintenance of bridges over the River Trent.

In 1550, Edward VI made a grant by charter of the “lands, tenements and hereditaments” of two monasteries which had been dissolved by his father Henry VIII. The grant was made to the “Mayor and Burgesses of the town of Nottingham, and to their successors for ever”, and was stated to be to fulfill a promise of Henry VIII “in consideration of the great charges and expenses daily sustained by his well-beloved the Mayor and Burgesses of his town of Nottingham in and about the mending, sustaining and repairing of their bridges over the water of Trent".

Bridge Estate was thus created by Royal Charter on 21 February 1551 with the then Corporation as sole

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BRIDGE ESTATE ANNUAL REPORT 2020/21

trustee.

It was established in 1945 that Bridge Estate was and had from the beginning been a Charity. Consequently, the property of the Estate and the Council elected members as Trustees, are subject to the law affecting charitable trusts, the jurisdiction of the Charity Commissioners and the provisions of the Charities Act 2011, various statutes and the provisions of Charity Law.

Trustees’ selection methods

Nottingham City Council (NCC) elected members are the Council’s representatives for the Bridge Estate.

NCC has elected members who are elected on a 4 year cycle. The following table details the councillors / trustees for the financial year 1 April 2020 to 31 March 2021 and also includes any post year trustee movements:

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Councillor Adele Williams Councillor Leslie Ayoola
Councillor AJ Matsiko Councillor Linda Woodings
Councillor Andrew Rule Councillor Maria Joannou
Councillor Angela Kandola Councillor Maria Watson
Councillor Angharad Roberts Councillor Merlita Bryan
Councillor Anne Peach Councillor Michael Edwards
Councillor Audra Wynter Councillor Mohammed Saghir
Councillor Audrey Dinnall Councillor Neghat Khan
Councillor Azad Choudhry Councillor Nick Raine
Councillor Carole McCulloch Councillor Nicola Heaton
Councillor Cate Woodward Councillor Patience Ifediora
Councillor Chantal Lee Councillor Pavlos Kotsonis
Councillor Cheryl Barnard Councillor Phil Jackson
Councillor Dave Liversidge Councillor Rebecca Langton
Councillor David Mellen Councillor Roger Steel
Councillor David Trimble Councillor Rosemary Healy
Councillor Ethan Radford Councillor Sajid Mohammed
Councillor Eunice Campbell-Clark Councillor Sally Longford
Councillor Georgina Power Councillor Salma Mumtaz
Councillor Graham Chapman Councillor Sam Webster
Councillor Gul Khan Councillor Samuel Gardiner
Councillor Hassan Ahmed Councillor Shuguftah Quddoos
Councillor Jane Lakey Councillor Steve Battlemuch
Councillor Jawaid Khalil Councillor Sue Johnson
Councillor Jay Hayes Councillor Toby Neal
Councillor Kevin Clarke Councillor Wendy Smith
Councillor Kirsty Jones Councillor Zafran Khan
Councillor Lauren O'Grady
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BRIDGE ESTATE ANNUAL REPORT 2020/21

Trusts and Charities Committee

Councillors are appointed to membership of the Trusts and Charities Committee by full Council to fulfil the Council’s responsibilities as Trustees. The Constitution allows that where in-year changes are required to memberships, either at the request of the relevant political group or because a member has resigned or ceased to be eligible for membership, the Corporate Director of Finance and Resources has the authority to action those changes subject to political balance being preserved where applicable and to the changes made being reported to the next meeting of Council. Details of membership will be updated and published on the Council’s website on an ongoing basis. The following is the current list of the Trusts and Charities Committee appointed members who approve the Annual Report and financial statements for the financial year 1 April 2020 to 31 March 2021:

Councillor Sajid Mohammed (Chair) Councillor Sam Gardiner Councillor Rosemary Healy Councillor Sue Johnson Councillor Anne Peach Councillor Ethan Radford Councillor Angharad Roberts Councillor Audra Wynter Councillor Andrew Rule

Induction and training of Trusts and Charities Committee

Following appointment, councillors are invited to attend an induction which includes training on their role and responsibilities on behalf of the Trustees, with particular regard to the public benefit requirement. The historical background, policies and procedures of Bridge Estate are also covered and the councillors receive copies of Charity Commission published guidance.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

REFERENCE AND ADMINISTRATIVE DETAILS

Charity Name Bridge Estate
Charity Number 220716
Registered Address Nottingham City Council
Loxley House
Station Street
Nottingham
NG2 3NG
Charity’s Trustees Councillors of Nottingham City Council
Day to Day Management Director of Economic Development & Property
Directorate
Loxley House
Station Street
Nottingham
NG2 3NG
Auditors Rogers Spencer
Newstead House
Pelham Road
Nottingham
NG5 1AP
Financial Advisor Corporate Director of Finance ad Resources
Nottingham City Council
Loxley House
Station Street
Nottingham
NG2 3NG
Bankers Lloyds Bank
Parliament Street Nottingham
12-16 Lower Parliament Street
Nottingham
NG1 3DA

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BRIDGE ESTATE ANNUAL REPORT 2020/21

RESPONSIBILITIES OF THE TRUSTEES

The Trustees’ Responsibilities

The trustees are responsible for preparing the Trustees’ Annual 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 that 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 the Charities Act 2011, the Charities (Accounts and Reports) Regulations 2008 and the provisions of the governing document. 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.

The trustees confirm, so far as they are aware, that:

Approved by the Trusts and Charities Committee and signed on behalf of Nottingham City Council by:

Date: 21/07/2021

Cllr Sajid Mohammed (Chair), Signed for the Trustees

The notes form part of these accounts.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Statement of Financial Activities for the year ending 31 March 2021

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2020/21 2019/20
Unrestricted Endowment Unrestricted Endowment
Funds Funds Total Funds Funds Funds Total Funds
£ £ £ £ £ £
Income and endowments from:
Other Trading Activities (2,124,020) - (2,124,020) (2,301,525) - (2,301,525)
Investments (1,017) - (1,017) (9,950) - (9,950)
Other (21,990) - (21,990) (79,305) - (79,305)
Total (2,147,027) - (2,147,027) (2,390,780) - (2,390,780)
Expenditure on:
Raising Funds - 127,258 127,258 - 254,874 254,874
Charitable Activities 50,220 784,861 835,081 50,665 117,613 168,278
Charitable Activities - Transfer to
1,545,000 - 1,545,000 1,545,000 - 1,545,000
NCC
Increase / (Decrease) in Loss
121,603 - 121,603 68,380 - 68,380
Allowance
Other - 60,844 60,844 - 65,713 65,713
Total 1,716,823 972,963 2,689,786 1,664,045 438,200 2,102,245
Net (income) /expenditure (430,204) 972,963 542,759 (726,735) 438,200 (288,535)
Transfer between Funds 1,033,058 (1,033,058) - 923,622 (923,622) -
Other Recognised (Gains)/Losses
(Gains)/losses on Revaluation of
- 311,179 311,179 - (111,051) (111,051)
Investment Properties
(Gains)/losses following Fair
Value assessment of Financial - (123,686) (123,686) - 1,741 1,741
Investments
Other (gains)/losses - - - - (31,046) (31,046)
Net Movement in Funds 602,854 127,398 730,252 196,887 (625,778) (428,891)
Reconciliation of Funds
Total Funds Brought Forward (976,318) (28,537,711) (29,514,029) (1,173,205) (27,911,933) (29,085,138)
Total Funds Carried Forward (373,464) (28,410,313) (28,783,777) (976,318) (28,537,711) (29,514,029)
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BRIDGE ESTATE ANNUAL REPORT 2020/21

Balance Sheet as at 31st March 2021

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Note 2020/21 2019/20
(£) (£)
Fixed Assets
Property Investments 6 29,818,293 29,952,336
Investments at Fair Value through Statement of
7 651,087 527,401
Financial Activities
Total Fixed Assets 30,469,380 30,479,737
Current Assets
Debtors (net of Bad Debt Provision) 8 927,800 779,304
Cash at Bank 8 495,641 1,341,228
Total Current Assets 1,423,441 2,120,532
Liabilities
Creditors - Amounts falling due within one year 9 (1,085,055) (881,958)
Net Current Assets 338,386 1,238,574
Total Assets Less Current Liabilities 30,807,766 31,718,311
Creditors - Amounts falling due after one year 9 (40,879) (40,879)
Long Term Borrowing 9 (1,983,110) (2,163,403)
NET ASSETS 28,783,777 29,514,029
The Funds of the Charity
Endowment Fund (28,410,313) (28,537,711)
Unrestricted Funds (373,464) (976,318)
TOTAL CHARITY FUNDS (28,783,777) (29,514,029)
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Approved by the Trusts and Charities Committee and signed on behalf of Nottingham City Council by:

Date: 21/07/2021

Clive Heaphy - Corporate Director of Finance and Resources

Date: 21/07/2021

Cllr Sajid Mohammed (Chair), Signed for the Trustees

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BRIDGE ESTATE ANNUAL REPORT 2020/21

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting Policies

General Principles

The Annual Report summarises the Bridge Estate transactions for 2020/21 financial year together with its financial position at 31 March 2021.

This section explains the accounting policies applied in producing the Annual Report for the Bridge Estate. Accounting policies are the principles, bases, conventions and rules by which transactions are recognised, measured and presented in the accounts.

Basis of preparation and assessment of going concern

The accounts have been prepared in accordance 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 (FRS 102) issued in October 2019, the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) and UK Generally Accepted Accounting Practice.The trustees consider that there are no material uncertainties about the Trust’s ability to continue as a going concern.

The cash flow statement forms part of the Nottingham City Council's group accounts.

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

The financial statements are prepared in sterling which is the functional currency of the charity and rounded to the nearest £1.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

Income Recognition

Income receipts are accrued and accounted for in the period to which they relate. Payments received in advance are recognised as a liability on the balance sheet within creditors.

Rental income is recorded when the invoices are raised and become due for payment.

Expenditure Recognition

All expenditure is accrued and accounted for in the period during which they are consumed or received. Accruals have been made for all material sums unpaid at the year-end for goods or services received or work completed. Receipts received in advance are recognised as an asset on the balance sheet within debtors. Expenditure is classified under the following activity headings:

Raising Funds

Costs of raising funds includes premises expenses, which includes day to day maintenance, insurance and external audit fees. These are initially charged against the Endowment Fund in the SoFA, as recommended in the Charities SORP, but transferred to Unrestricted Funds within Gross Transfer between Funds.

Charitable Activities

The costs of governance arrangements, which relate to the general running of the charity, as opposed to direct management functions inherent in generating funds, service delivery and programme. These activities provide the governance infrastructure, which allows the charity to operate and to generate the information required for public accountability.

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Charitable Activities – Transfer to NCC

The net expenditure or income of the Bridge Estate is transferred to NCC’s General Fund for the benefit of the citizens of Nottingham.

Other

Expenditure which does not fall into any of the above categories, such as interest and principal loan repayments.

Irrecoverable VAT

Irrecoverable VAT is charged against the expenditure heading for which it was incurred.

Other recognised Gains/(losses)

The gains/(losses) on investment assets, represents the differences between proceeds received on disposals and their market value at the beginning of the year.

The gains/(losses) on revaluation of investment assets represents material changes in property valuations. Fixed Assets

Investment properties

Investment properties are those used solely to earn rentals and/or for capital appreciation for the Bridge Estate. Investment properties are measured initially at cost. They are not depreciated but are revalued annually according to market conditions at year-end.

Due to the current pandemic the 2020/21 valuations have been carried out in accordance with current RICS guidance and any subsequent effect on valuations will be undertaken in 2021/22. Gains and losses on revaluation and on disposal are shown within the SOFA. However as revaluation and disposal gains and losses are not allowed by statute to impact on the financial activities of the Bridge Estate, they do not form part of the income and expenditure totals, but provide details within the SOFA of the movement on the Endowment Fund. Any sale proceeds are posted to the Endowment Fund.

Rental income from investment properties is credited to investment income within the SOFA.

Where land or property is held as a community asset, dedicated for the enjoyment of the public in perpetuity they are given a value of £NIL.

Other investments

Other investments are included in the Balance Sheet at market value and include loans and government stocks.

Accruals of Expenditure and Income

The accounts of the Bridge Estate are maintained on an accruals basis. This means that sums due to or from the Bridge Estate during the year are included whether or not the cash has actually been received or paid in the year. Where income and expenditure has been recognised but cash has not been received or paid, a debtor or creditor for the relevant amount is recorded in the balance sheet. Cash received or paid and not yet recognised as income or expenditure is shown as a creditor (receipt in advance) or debtor (payment in advance) in the balance sheet and the SOFA adjusted accordingly. Fees, charges and rents due from customers are accounted for as income at the date that the Bridge Estate provides the associated goods or services.

This policy is not followed for certain quarterly payments, including gas and electricity, where expenditure is recorded at the date of meter reading rather than being apportioned between financial years. This policy is consistently applied each year and, therefore, does not have a material effect on the year's accounts.

Where it is doubtful that a debt will be settled, the balance of debtors is written down and a charge made to the SoFA for the income that might not be collected. This bad debt provision is offset against the debtor

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balance on the balance sheet.

Due to the current pandemic Bridge Estate has increased it bad debt provision by c35%, to take into account any amounts which Bridge Estate will be unable to collect from tenants in financial difficulty. In many cases, the value to be entered in respect of accrued transactions will be certain.

In others, this value has to be estimated and reference is then made to past transactions and trends in order to determine the likely value.

Cash

Cash is represented by deposits held within the Bridge Estate bank account.

Funds of the Charity

Endowment fund

The capital of the Bridge Estate is held as a permanent endowment fund. There is no power to convert the capital into income; the fund must generally be held indefinitely.

Unrestricted income fund

This fund has been established so that the cost of repairing Trent Bridge was spread out and does not impact on the finances of the Charity in a particular year. In 2006/07 an additional Renewal and Repairs Fund was set up to meet the cost of repairs to the housing stock held by the Bridge Estate. Annual contributions are made to the fund and repairs costs are charged to the SoFA in the year they are carried out, with transfers being taken from the fund.

The income from the fund is unrestricted income but it is expendable at the discretion of the active trustees in the furtherance of the charity’s objectives.

2. Tax status of the Bridge Estate

Bridge Estate is a registered charity and is therefore exempt from income tax and capital gains tax on income and gains falling within S531 ITA 2007 and S256 CGA 1992. Nottingham City Council is the sole trustee of the Bridge Estate and, in accordance with VAT notice 749, is entitled to recover VAT incurred on the expenditure of the Bridge Estate under section 33 of the VAT Act 1994.

3. Summary of Fund Movements

2020/21
2019/20
Endowment
Fund
Unrestricted
Funds
TOTAL
Endowment
Fund
Unrestricted
Funds
TOTAL
£
£
£
£
£
£
Balance B/fwd
Incoming Resources
Outgoing Resources
Transfers
Gains and Losses
Other Movements
Balances C/fwd		 (28,537,711)
(976,318)
(29,514,029)
(27,911,933)
(1,173,205)
(29,085,138)
-
(2,147,027)
(2,147,027)
-
(2,390,780)
(2,390,780)
972,963
1,716,823
2,689,786
438,200
1,664,045
2,102,245
(1,033,058)
1,033,058
-
(923,622)
923,622
-
187,493
-
187,493
(109,310)
-
(109,310)
-
-
-
(31,046)
-
(31,046)
(28,410,313)
(373,464)
(28,783,777)
(28,537,711)
(976,318)
(29,514,029)

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Incoming Resources

As a general rule, incoming capital resources to the Bridge Estate are generated by the sale of investment properties or the payment of premiums in respect of the re-gearing of long leaseholds. The Bridge Estate capital fund is a permanent endowment fund which means that it cannot usually be spent as income. Thus, any income generated by the sale of freehold land or buildings, or the re-gearing of long leaseholds on payment of a premium, must be reinvested in the purchase or improvement of freehold land and buildings.

At the discretion of the Charity Commission, funds may be spent on infra-structure assets but any sum spent will have to be recouped and the capital fund replenished.

Other Recognised (Gains)/Losses

The annual revaluation of the property portfolio has been completed in 2020/21 resulting in a loss on revaluation of assets of £311,179.

Unrestricted income fund

During 2020/21 the Bridge Repairs Fund was fully drawn down to pay for the works carried out in year, meaning a drawdown of £590,463 (£72,000 contribution 2019/20), while the unrestricted funds had a contributions of 47,702 (£216,535 2019/20).

4. Income and Expenditure Detailed Analysis

----- Start of picture text -----
2020/21 2019/20
£ £
INCOME
Rent (net of movement in Loss Allowance) (1,903,994) (2,172,935)
Service Charges (98,423) (60,210)
Interest Received (1,017) (9,950)
Other (21,990) (79,305)
(2,025,424) (2,322,400)
EXPENDITURE
Raising Funds
Agency and Contracted Services
Cleaning 597 7,448
Grounds Maintenance 18,365 22,749
Investment Management Costs
Business Rates 17,708 108,362
Energy Costs 42,826 50,375
Insurance 20,760 20,760
Property Maintenance 1,095 7,029
Rent Collection 27,428 23,326
Supplies and Services 34,641 33,172
Water Charges 4,798 623
Charitable Activities
Surplus transferred to NCC General Fund 1,545,000 1,545,000
Property Repairs (inc Bridge) 624,772 (18,970)
Audit Costs 10,150 10,950
Support Costs
Management and Administration 159,200 157,328
Other
----- End of picture text -----

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Interest Payable 60,845
65,713
(590,463)
72,000
47,702
216,535
Movement to Funds
Contribution to / (from) Repairs Fund
Contribution to / (from) Unrestricted Fund
2,025,424
2,322,400

5. Allocation of governance and support costs

The breakdown of support costs and how these were allocated between governance and other costs is shown below:

----- Start of picture text -----
2020/21
Governance Other
Total SOFA Category Basis of Apportionment
Related () Support Costs
£ £ £
Audit Fees 10,150 10,150 - Charitable Activities External Provider's Annual Fee
Computer
17,100 - 17,100 Charitable Activities Software Usage
Costs
Recharged
55,140 23,548 31,592 Charitable Activities Staff Time
Staff Costs
Valuation Fees 86,960 16,522 70,438 Charitable Activities Asset Valuation Costs/Staff Time
169,350 50,220 119,130
----- End of picture text -----*

----- Start of picture text -----
2019/20
Governance Other
Total SOFA Category Basis of Apportionment
Related () Support Costs
£ £ £
Audit Fees 10,950 10,950 - Charitable Activities External Provider's Annual Fee
Computer
17,100 - 17,100 Charitable Activities Software Usage
Costs
Recharged
55,140 23,548 31,592 Charitable Activities Staff Time
Staff Costs
Valuation Fees 85,088 16,167 68,921 Charitable Activities Asset Valuation Costs/Staff Time
168,278 50,665 117,613
----- End of picture text -----*

(*) Governance Related Costs are met entirely from Unrestricted Funds.

6. Investment Property

Investment property represents assets owned by the Bridge Estate, primarily property and buildings all situated in the United Kingdom. The portfolio of property is mainly investment properties which are valued by Nottingham City Council Property Service Chartered Surveyor (member of the Royal Institution of

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Chartered Surveyors) and in accordance with the Royal Institute of Chartered Surveyors Appraisal and Valuation Standards Manual (the Red Book). Properties held by the Bridge Estate are non-operational properties and as such, the valuation is on the basis of open market value. This area is managed by the Director of Economic Development and Property.

Investment properties in the portfolio are valued at market value in accordance with the Charities SORP. Some properties have a de-minimis value of £NIL as they are community assets, dedicated for the enjoyment of the public in perpetuity.

Assets that are sold are re-valued pending sale and written out of the accounts at this value.

Analysis of the movement in Investment Property 2020/21
2019/20
(£)
(£)
Carrying value (market value) at beginning of year
Add: Additions to investments at cost
Add: Capital Expenditure Incurred
Less: Disposals at carrying value
Add/deduct: Net gains/(losses) on revaluation
Carrying value (market value) at end of year		 29,952,336
29,841,285
-
-
177,136
-
-
-
(311,179)
111,051
29,818,293
29,952,336

The following properties whose value is greater than £1m, are considered to be material in the context of the investment property list:

Property Value 2020/21
£		 Value 2019/20
£
Century House, 8-18 Chapel Bar 1,501,632 1,358,026
Woolsthorpe Close, Off Wigman Road, Bilborough 3,655,902 3,866,084
Eastcroft Depot, London Road 2,900,000 2,900,000
The Alexander Fleming Building, Nottingham
Science and Technology Park, University Boulevard		 2,000,000 1,496,235
34-38 Lister Gate 1,795,000 3,706,007
Units 21-29, Whitemoor Court, Nuthall Road 3,458,353 3,259,238
14-16 Wheeler Gate 995,535 1,125,000

7. Other Investments

2020/21 2019/20
£
£
Government Stocks
COIF Accumulation Units		 1,385 1,385
526,016
649,702
651,087 527,401

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BRIDGE ESTATE ANNUAL REPORT 2020/21

Analysis of the movement in Other Investments 2020/21 2019/20
£
£
Carrying value (market value) at beginning of year
Add/deduct: Net gains/(losses) on revaluation
Carrying value (market value) at end of year		 527,401 529,142
(1,741)
123,686
651,087 527,401

8. Analysis of current assets

Debtors 2020/21 2019/20
£
£
Trading Activities
Amounts due from subsidiary and associated
undertakings		 370,685 461,662
317,642
557,115
927,800 779,304
Cash 2020/21 2019/20
£
£
Cash at bank 495,641 1,341,228

9. Analysis of current liabilities and long term creditors

2020/21 2019/20
£
£
Amounts due to subsidiary and associated undertakings
(including subsidiary Receipts in Advance)
Other creditors
Receipts in Advance		 (713,589) (487,125)
(308,287)
(86,546)
(153,728)
(217,738)
(1,085,055) (881,958)
2020/21 2019/20
£
£
Rent Bonds
Long Term Borrowing		 (40,879) (40,879)
(2,163,403)
(1,983,110)
(2,023,989) (2,204,282)

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BRIDGE ESTATE ANNUAL REPORT 2020/21

10. Analysis of Lessor Operating Leases

10. Analysis of Lessor Operating Leases
2020/21 2019/20
£
£
Not later than one year
Between one and five years
Later than five years
Total		 1,115,530 1,674,952
2,833,420
11,674,306
1,858,536
11,503,029
14,477,095 16,182,678

11. Analysis of net assets between funds

11. Analysis of net assets between funds
2020/21
2019/20
Endowment
Fund
Unrestricted
Funds
Endowment
Fund
Unrestricted
Funds
£
£
£
£
Investment Properties
Other investments
Debtors (net of Bad Debt Provision)
Cash at Bank
Creditors - Amounts falling due within one
year
Creditors - Amounts falling due after one
year
Long Term Borrowing		 29,818,293
-
29,952,336
-
-
651,087
-
527,401
-
927,800
-
1,019,536
755,413
(259,772)
929,061
412,167
(180,283)
(904,772)
(180,283)
(941,907)
-
(40,879)
-
(40,879)
(1,983,110)
-
(2,163,403)
-
28,410,313
373,464
28,537,711
976,318

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BRIDGE ESTATE ANNUAL REPORT 2020/21

12. TRANSACTIONS WITH RELATED PARTIES

NCC elected members are representing the Council as sole trustees of the Bridge Estate and any related party transactions must be disclosed in accordance with Charity SORP.

A loan of £3,922,881 was approved in 2012/13 to assist in the purchase of an investment property, this loan is for a period of 20 years and for accounting purposes is treated as long term borrowing. The payment started annually on the 31 March 2014. The payments will be made up of £180,283 principal and 2.70% pa interest on the average loan balance in the year. In 2020/21 the Bridge Estate paid £60,845 interest (£65,713 2019/20), which is shown within the SoFA under Other Expenditure and short term creditors, while the outstanding long term borrowing at the 31 March 2021 is £1,983,110 (£2,163,403 2019/20) which is shown in the balance sheet.

Monies due from NCC and other group entities (Robin Hood Energy and Nottingham City Homes) at the end of the financial year to the Bridge Estate was £557,115(£317,642 2019/20). Monies owed to NCC and group entities was £713,589 (£487,125 2019/20).

In addition to transactions involving investments and cash balances, there are other transactions between the Charity and the City Council in respect of the day-to-day operations of the Charity.

In the year to 31 March 2021 various City Council departments and other Council group entities paid a sum of £627,370 (£577,434 2019/20) in respect of investment properties let by the Charity at current market rents subject to periodic reviews and related service charges. This income is included in the SoFA.

NCC charged the Bridge Estate £159,200 in the year to 31 March 2021 (£157,328 2019/20) in respect of officers’ time and management and maintenance of properties. Of this total it is estimated that £40,070 (£39,715 2019/20) is attributable to the governance of the Charity. These costs relate to the preparation of the final accounts, valuation fees, legal fees and attendance and preparation for the Trusts and Charities Committee meetings.

The Charity had a charge of £18,962 (£30,197 2019/20) for grounds maintenance and contract cleaning, while insurance costs of £20,760 (£20,760 2019/20) was paid to NCC. These transactions are shown within Raising Funds in the SoFA.

Surplus of income over expenditure during the year is transferred to NCC’s General Fund for the improvement of the City of Nottingham and the public benefit of its inhabitants £1,545,000 (£1,545,000 2019/20).

During the current financial year, trustees received remuneration of £nil (£nil 2019/20) and had expenses reimbursed of £nil (£nil 2019/20).

23