Charity number 226621
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home)
Trustees' Report and Accounts
31 December 2023
The Friendly Societies Convalescent Scheme Trustees' Report and Accounts Contents
| Page | |
|---|---|
| Reference and administration details | 1 |
| Trustees' report | 2 - 4 |
| Statement of Financial Activities | 5 |
| Balance sheet | 6 |
| Notes to the accounts | 7 - 11 |
| Independent Examiner's Report | 12 |
1
The Friendly Societies Convalescent Scheme
Reference and Administration Details
Trustees
Mrs Janet M. Clements - Chairman Mrs Joanne Andrew Mrs Dorothy Deacon Mrs Gail Lancaster - appointed 28 September 2023 Mrs Janet Lewis Mr John Potton Mr Peter Saunders Mrs Angela Stanley
Independent Examiner
Mr Daniel Valentine ACA Begbies Unit 14, Park Barn Evegate Business Park Smeeth, Ashford TN25 6SX
Bankers
Nat West 140 High Street Herne Bay Kent CT6 5JX
Principal Address
PO Box 552 Ashford Kent TN23 9UT
Charity registered number 226621
2
The Friendly Societies Convalescent Scheme
(formerly The Friendly Societies Convalescent Home)
Trustees' Report
for the year ended 31 December 2023
The Trustees present their report and accounts for the year ended 31 December 2023.
The Trustees confirm that the Annual Report and accounts have been prepared in accordance with the accounting policies set out in Note 1 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 FRS 102 applicable in the UK and Republic of Ireland published on 16 July 2014.
Structure, governance and management
The charity is set up by constitution and operated by the Board of Trustees. New trustees are interviewed and appointed by the Board.
Risk management
The Trustees have identified the major risks which the charity faces and consider that all necessary action has been taken to manage those risks.
Objectives and activities for the public benefit
The charity's original object was to provide convalescent treatment for members of friendly societies through its convalescent home in Herne Bay.
Following the sale of the charity's convalescent home in August 2010, the Trustees reviewed their objectives and activities with the Charity Commission and the charity's revised objects, under a scheme dated 20 May 2015, are the relief of sickness and the preservation of health of the public, in particular but not exclusively to assist members of Friendly Societies by providing grants to help in the provision of facilities and support services.
The Trustees confirm that they have continued to comply with their duty in Section 17 of the 2011 Charities Act to have due regard to the Charity Commission's public benefit guidance.
Grant making policy
The trustees' policy is to support any persons with financial grants towards the cost of convalescence. Applications must be supported by a medical report from a hospital or doctor supporting the need for a convalescent stay. The trustees will also consider a grant towards the cost of a carer staying with the patient on convalescence.
The trustees also provide grants towards the costs of a shortfall in convalescent claims to the Oddfellows and Foresters Friendly Societies. A system is place through the Societies whereby the applications are approved following medical certification. From November 2020 the trustees will pay 100% of any shortfall up to £500 per week, up to 2 weeks per annum.
No claims have been refused. These claims require a medical certificate signed by a Doctor. The trustees continue to explore ways of extending the guest programme.
3
The Friendly Societies Convalescent Scheme
(formerly The Friendly Societies Convalescent Home)
Trustees' Report
for the year ended 31 December 2023
Trustees' report and financial review
The challenge for the Trustees has been to promote the Charity in a sensible way. With convalescent homes closing throughout the country the natural inclination is to feel that the facility is no longer required. However, the Trustees believe the need exists and it is a case of promoting the benefits of a convalescent or respite stay. Each claim is considered on its’ individual merits. Sometimes the grant is a top up grant to stay through a Society scheme, other times it is to stay at a specific location such as a hotel or apartment with family support.
The difficulties with the PO Box can not be underestimated and it is very distressing to think that people were waiting to hear and may consider they were ignored.
The leaflet and linked Facebook proved more difficult to source than anticipated.
Funds continue to be available and well managed and the increased focus will be to promote and attract.
Total income for the year was £49,032 (2022: £49,472) and total expenditure was £53,014 (2022: £54,973). Net gains on investments amounted to £85,385 (2022: losses of £286,928) resulting in net surplus for the year of £81,403 (2022: net deficit of £292,429). At 31 December 2023 total funds were £2,169,423 of which £193,435 were unrestricted.
Investment policy and performance
The management of the investment portfolio is governed not only by a Client Agreement Letter (September 2013) but also by a Written Investment Policy Statement (“WIPS”) dated 31st July 2012. The WIPS can be summarised as follows: The Trustees have chosen as their investment objective a Balanced return (between income and capital growth) and to maintain the capital value at least in line with inflation. An appropriate mix of assets within certain ranges has been agreed (as revised 10th July 2014). In terms of risk, the Trustees have a moderate level of tolerance and have directed the Managers to have due regard for the suitability of the investments held and the need for diversification (including the stipulation that no non-collective investment should exceed 8% of the value of the portfolio).
In the calendar year 2023 the portfolio returned 5.92% net of fees (6.79% gross) vs a benchmark return of 10.02% (gross). The portfolio benefitted from strong performance in both fixed income and equity but lagged the benchmark in the US where a high level of concentration persisted. A handful of companies (the so-called “Magnificent 7” big tech companies) dominating the index and returns, accounting for a material 30% of the market capitalisation of the S&P500 index and 20% of global markets. We favour a more diversified approach blending sectors and styles targeting a balance between risk and return. This approach might lag the index when high concentration exists but presents charities and trustees with a more balanced return profile ensuring the focus can remain on the charity and its objectives. We have been incrementally rotating the portfolio towards a more global outlook ensuring the strategy exhibits the best investment ideas, regardless of the country of domicile. In terms of our asset class positioning, the portfolio is modestly overweight equities as economic conditions continue to improve and we have increased our fixed income weight and duration to broadly neutral relative to the benchmark. Performance so far in 2024 has been strong and we remain cautiously optimistic as we continue to monitor inflation trending towards target and central banks beginning to ease monetary policy. Both should present a tailwind for risk assets.
4
The Friendly Societies Convalescent Scheme
(formerly The Friendly Societies Convalescent Home)
Trustees' Report
for the year ended 31 December 2023
Reserves policy
The Trustees are aware that the reserves are growing and are seeking more options to increase grants. Their aim is that 50% of their annual income should go towards grants, and that they should hold the income for 2 years in reserve to give continuity should their investments underperform.
Trustees' responsibilities
The Trustees are responsible for preparing the Trustees' report and accounts in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
Charity law requires the Trustees to prepare accounts for each financial year which give a true and fair view of the state of affairs of the charity and of its incoming resources and application of resources of the charity for that period. In preparing these accounts, the Trustees are required to:
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select suitable accounting policies and then apply them consistently;
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● observe the methods and principles in the Charities SORP;
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make judgements and estimates that are reasonable and prudent;
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prepare the accounts on the going concern basis unless it is inappropriate to presume that the charity will continue in business.
The Trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the accounts comply with the 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.
This report was approved by the Trustees on 21 October 2024
Mrs Janet M Clements Chairman
5
The Friendly Societies Convalescent Scheme
(formerly The Friendly Societies Convalescent Home)
Statement of Financial Activities
for the year ended 31 December 2023
| Notes Income from: Investments 2 Total income Expenditure on: Raising funds 3 Charitable activities 4 Total expenditure Net gains/(losses) on investment assets Net income/(expenditure) Transfers Transfers between funds Net movement in funds Reconciliation of Funds Total Funds at 1 January 2023 Total Funds at 31 December 2023 |
Permanent Endowment Unrestricted Total Fund Fund 2023 £ £ £ - 49,032 49,032 - 49,032 49,032 17,262 6,289 23,551 - 29,463 29,463 17,262 35,752 53,014 85,385 - 85,385 68,123 13,280 81,403 - - - 68,123 13,280 81,403 1,907,865 180,155 2,088,020 1,975,988 193,435 2,169,423 |
Permanent Endowment Unrestricted Total Fund Fund 2022 £ £ £ - 49,472 49,472 - 49,472 49,472 17,495 5,774 23,269 - 31,704 31,704 17,495 37,478 54,973 (286,928) - (286,928) (304,423) 11,994 (292,429) - - - (304,423) 11,994 (292,429) 2,212,288 168,161 2,380,449 1,907,865 180,155 2,088,020 |
|---|---|---|
The Notes to the Accounts form part of the Financial Statements
6
The Friendly Societies Convalescent Scheme
(formerly The Friendly Societies Convalescent Home)
Balance Sheet
as at 31 December 2023
| Notes Fixed assets Investments - Listed investments 8 - Cash held within portfolio Current assets Debtors 9 Cash at bank 10 Creditors: amounts falling due within one year 11 Net current (liabilities)/assets Net assets Represented by: Permanent Endowment Fund Unrestricted Fund Total Funds 12 |
£ £ 2,142,059 27,538 2,169,597 119 6,923 7,042 (7,216) (174) 2,169,423 1,975,988 193,435 2,169,423 2023 |
£ £ 2,021,190 51,295 2,072,485 113 20,167 20,280 (4,745) 15,535 2,088,020 1,907,865 180,155 2,088,020 2022 |
|---|---|---|
Approved by the Trustees on 21st October2024
Mrs Janet M Clements Chairman
The Notes to the Accounts form part of the Financial Statements
7
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home) Notes to the Accounts for the year ended 31 December 2023
1 Accounting policies
Basis of preparation and assessment of going concern
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 (FRS102) published on 16 July 2014, the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) and the Charities Act 2011.
The accounts have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant note(s) to these accounts.
The charity constitutes a public benefit entity as defined by FRS 102.
The trustees consider that there are no material uncertainties about the charity's ability to continue as a going concern.
Fund accounting
The Unrestricted Fund is available for use at the discretion of the trustees in furtherance of the general objectives of the charity.
The Permanent Endowment Fund derives from the sale proceeds of the convalescent home. The Charity Commission lifted the restriction over the sale of the home, permitting its sale, and as a result the proceeds continue to carry the permanent requirement originally attached to the property.
Income
All income is recognised once the charity has entitlement to the income, there is sufficient certainty of receipt and so it is probable that the income will be received, and the amount of income receivable can be measured reliably.
Interest on funds held on deposit is included upon notification of the interest paid or payable by the bank. Dividends are recognised upon notification from our investment advisor of the dividend paid or payable.
Expenditure
Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, it is probable that settlement will be required and the amount of the obligation can be measured reliably.
All expenditure is accounted for on an accruals basis. All expenses, including support costs and governance costs, are allocated or apportioned to the applicable expenditure headings in the statement of financial activities.
Grants payable are payments made to third parties in the furtherance of the charitable objects of the charity. In the case of an unconditional grant offer, this is accrued once the recipient has been notified of the grant award. Grant awards that are subject to the recipient fulfilling performance conditions are only accrued when the recipient has been notified of the grant and any remaining unfulfilled condition attaching to that grant is outside of the control of the Trust.
Irrecoverable VAT is charged against the expenditure heading for which it was incurred.
The costs of raising funds consist of investment management and an apportionment of support and governance costs
The expenditure on charitable activities includes grants payable and an apportionment of support and governance costs.
8
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home) Notes to the Accounts for the year ended 31 December 2023
Fixed asset investments
Investments are a form of basic financial instrument and are initially recognised at their transaction value and subsequently measured at their market value as at the balance sheet date using the closing quoted market price.
All gains and losses are taken to the statement of financial activities as they arise. Realised gains and losses on investments are calculated as the difference between sales proceeds and their opening carrying value or their purchase value if acquired subsequent to the first day of the financial year. Unrealised gains and losses are calculated as the difference between fair value at the year end and their carrying value. Realised and unrealised investment gains and losses are combined in the statement of financial activities.
The charity does not acquire or use put options, derivatives or other complex financial instruments.
| 2 Investment income Interest received Nat West Investec Wealth & Investment Ltd Investec portfolio 3 Costs of raising funds Investment management costs Support and governance costs (see note 5) 4 Expenditure on charitable activities Grants payable (see note 6) Support and governance costs (see note 5) |
2023 £ 43 766 48,223 49,032 2023 £ 17,262 6,289 23,551 2023 £ 10,597 18,866 29,463 |
2022 £ 8 223 49,241 49,472 2022 £ 17,495 5,774 23,269 2022 £ 14,382 17,322 31,704 |
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9
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home) Notes to the Accounts
for the year ended 31 December 2023
| 5 Analysis of support and governance costs Support costs Staff costs (note 7) Travel and subsistence PO Box Storage rental Computer and website costs Bank charges Sundry expenses Governance costs Accountancy and independent examination Meeting expenses Total Allocated: Costs of raising funds (25%) (note 3) Charitable activities (75% ) (note 4) 6 Grants payable Paid to individuals 7 Staff costs Gross salaries Employer's national insurance |
2023 £ 17,160 - 390 1,100 1,069 327 1 20,047 3,900 1,208 5,108 25,155 2023 £ 6,289 18,866 25,155 2023 £ 10,597 10,597 2023 £ 17,160 - 17,160 |
2022 £ 17,160 226 372 1,100 - 331 145 19,334 3,762 - 3,762 23,096 2022 £ 5,774 17,322 23,096 2022 £ 14,382 14,382 2022 £ 17,160 - 17,160 |
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The average number of employees during the year was 1 (2022: 1).
During the year, no Trustee received any remuneration or benefits in kind (2022: £nil). Seven trustees received reimbursement of expenses in the year of £351 (2022: £226).
Total emoluments received by the charity's key management personnel was £17,160 (2022: £17,160).
10
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home) Notes to the Accounts for the year ended 31 December 2023
(formerly The Friendly Societies Convalescent Home)
| 8 Investments Market value At 1 January 2023 Additions at cost Disposals at carrying value Net gain on revaluation At 31 December 2023 Historical cost at 31 December 2023 Listed investments at fair value comprised: UK fixed interest Overseas fixed interest UK equities International equities Emerging economies Property Alternative assets 9 Debtors Prepayments 10 Cash balances Nat West 11 Creditors: amounts falling due within one year PAYE & NI Accruals |
2023 £ 316,891 61,991 270,507 1,079,012 84,347 71,281 258,030 2,142,059 2023 £ 119 2023 £ 6,963 2023 £ 316 6,900 7,216 |
Listed investments £ 2,021,190 1,095,539 (1,067,304) 92,634 2,142,059 1,912,854 2022 £ 218,817 131,604 507,931 719,875 70,074 80,694 292,195 2,021,190 2022 £ 113 2022 £ 20,167 2022 £ 315 4,430 4,745 |
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11
The Friendly Societies Convalescent Scheme (formerly The Friendly Societies Convalescent Home) Notes to the Accounts for the year ended 31 December 2023
| 12 Movement in Funds Permanent Endowment Fund Unrestricted Fund Movement in Funds Permanent Endowment Fund Unrestricted Fund |
B/fwd at C/fwd at 1st Jan Gains & 31st Dec 2023 Income Expenditure (losses) 2023 £ £ £ £ £ 1,907,865 - (17,262) 85,385 1,975,988 180,155 49,032 (35,752) - 193,435 2,088,020 49,032 (53,014) 85,385 2,169,423 B/fwd at C/fwd at 1st Jan Gains & 31st Dec 2022 Income Expenditure (losses) 2022 £ £ £ £ £ 2,212,288 - (17,495) (286,928) 1,907,865 168,161 49,472 (37,478) - 180,155 2,380,449 49,472 (54,973) (286,928) 2,088,020 |
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The unrestricted fund is available to be spent for any of the purposes of the charity.
The Permanent Endowment Fund derives from the sale proceeds of the convalescent home. The Charity Commission lifted the restriction over the sale of the home, permitting its sale, and as a result the proceeds continue to carry the permanent requirement originally attached to the property.
| 13 Analysis of Net Assets Between Funds Fixed assets investments Cash at bank Other current assets At 31 December 2023 Analysis of Net Assets Between Funds Fixed assets investments Cash at bank Other current assets At 31 December 2022 |
Endowment Unrestricted Total Fund Fund 2023 £ £ £ 2,169,597 - 2,169,597 - 6,923 6,923 (193,609) 186,512 (7,097) 1,975,988 193,435 2,169,423 Permanent Endowment Unrestricted Total Fund Fund 2022 £ £ £ 2,072,485 - 2,072,485 - 20,167 20,167 (164,620) 159,988 (4,632) 1,907,865 180,155 2,088,020 |
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14 Related Party Transactions
There were no related party transactions in the year.
12 The Friendly Societies Convalescent Scheme Independent Examiner's Report to the Trllstees for the year ended 3J Deeember 2023 I repoi't to the trustees on my examination of the accounts of Friendly Socieiies Convalescent Scheine (the chai'ity) foi. the year ended 31 Deceinbci. 2023 which are set out on pages 4 10 11. Respon5tbilities and basis of report As thc chai'ity's trustees you al'e responsible foi. the preparation of the accounts iJ] accordance with tlie requirements ofthe Charities Act 2011 ('the Act,). I report in rcspect of my examination of the trustees, accounts cai'ried out undei. section 145 of the 2011 Act and in cai'iying oul Iny examination I liave followed all thc applicable Directions given by the Chai'ity coinmis5ionei' under section 14515llb) of the 201 l Act. Independent exatniner'5 StatLment I have complete Iny exainination. I confllin ihat no material mattel's have Coine to my attention in ¢onn¢¢tion with the exainination giving Tne cause to belseve that in any Inaterial I'espe¢t.' 111 accounting records were not kept in iesp¢ct of the Trllst as i'equired by section 130 of the Act; or 121 the accounts do not accord with those I'ecords; or 131 the accounts do not C01nply with the applicable i'equireinents concerning the forn) and content of aCcolt5 sel Out in the Charities (Accounts and Reports) Regulations 2008 other than any requii'emenl that the accoiints give a 'true and fair view, whicli is not a Tnatter considered as part of an indcpendent exaTnination. I have no matters and have come across no othei. matters in connection with the examination to which attention should be drawn in ihis report in order to enable a PTopei' understanding of the account% to be reached. Daniel Valentine ACA Begbies Unit 14, Park Barn Evegate Business Park Sineeth, A5.hford Kent TN25 6SX 21(1012o&