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2021-03-31-accounts

The Congregation of the Sisters of Nazareth Charitable Trust

Annual Report and Audited Accounts 2020 – 2021

Charity Registration Numbers

England and Wales: 228906, Scotland: SC040507

Contents

Reference and Administrative Details of the Charity, its Trustees and Advisers ........................... 2 Introduction – About Us ................................................................................................................. 3 Our Heritage .................................................................................................................................... 5 Message From The Regional Superior ............................................................................................ 7 Yearly review ................................................................................................................................... 8 Trustees’ Report ............................................................................................................................ 11 Management and Trustees ........................................................................................................... 14 Risk management .......................................................................................................................... 17 Income and Expenditure ............................................................................................................... 18 Independent Auditor’s Report to the Trustees of The Congregation of the Sisters of Nazareth Charitable Trust ............................................................................................................................. 20 Statement of Financial Activities Year ended 31 March 2021 ...................................................... 24 Balance Sheet ................................................................................................................................ 25 Statement of cash flows ................................................................................................................ 26 Principal Accounting Policies 31 March 2021 ............................................................................... 28 Notes to the Accounts 31 March 2021 ......................................................................................... 33

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Reference and Administrative Details of the Charity, its Trustees and Advisers

Trustees
Sister Doreen Marie Cunningham Chair from 7 October 2019
Sister Teresa Bernadette Fallon appointed 29 January 2013
Sister Madeleine Merriman appointed 7 October 2015
Officers
Regional Superior – UK Region Sister Doreen Cunningham
Chief Executive Officer – UK Region Richard Whitby
Administrative Details
Principal Office Larmenier Centre
162 East End Road
London N2 0RU
Email: uk.administration@nazarethcare.com
Website: www.sistersofnazareth.com
Charity Registration Numbers: 228906 (England and Wales)
SCO40507 (Scotland)
Auditor Crowe U.K. LLP
55 Ludgate Hill
London
EC4M 7JW
Principal Bankers Barclays Bank plc
Acorn House
36-38 Park Royal Road
London
NW10 7JA
Principal Solicitors Stone King LLP
13 Queen Street
Bath
BA1 2HJ

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Introduction – About Us

Who We Are

The Congregation of the Sisters of Nazareth, UK Region is one Region of the worldwide Congregation. In this Region we have 13 sites which provide care for the elderly and young children. There are 66 Sisters who are spread across 11 communities.

Our Vision

To continue to provide care that promotes health and quality of life for all in our care and services to the local community where possible.

Our Mission

To promote and deliver with Nazareth Care quality caring services based on the compassion of Christ and in line with our Mission statement.

Our Aims and Objectives

Our Philosophy

Our Values

Our core values are based on Scripture, the heritage and tradition of the Sisters of Nazareth. All who are associated with the work of Nazareth are expected to demonstrate a commitment to these values:

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"Blessed are those who hunger and thirst for they shall be satisfied”. Matt 5:6

"Blessed are the gentle for they shall possess the earth". Matt 5.5

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Our Heritage

The Congregation of the Sisters of Nazareth (“the Congregation”) is an international Roman Catholic Religious Congregation consisting of 222 Sisters worldwide. It was founded in Hammersmith, England in 1851 by Victoire Larmenier, where its Generalate (governing body) is still located. It is divided into five Regions across the world: American, Australasian, Ireland, South African and United Kingdom (UK Region).

Victoire and 5 companions came to London in April 1851 at a time when England was predominantly Protestant and Catholics for the most part were in a state of extreme poverty and everywhere the aged Catholic poor were forced to seek shelter in workhouses.

Victoire Larmenier Foundress of Sisters of Nazareth 1827-1878

Their first house was in Brook Green and the first resident was received on 14 April 1851. From there the Sisters collected alms and food around London in order to care for the old and young who they took into their Home. As the numbers cared for grew each year, the need for larger and more suitable premises became urgent. In 1856 land was bought

at Hammersmith for the sum of 3,000 guineas, most of which was donated by generous benefactors.

On 9 October 1857 the first old people and children were moved into the new building which was named Nazareth House. From our beginnings there we spread around the world. Most of the work of the Congregation takes place within “Nazareth Houses” which are substantial buildings operated mainly as care homes for older people. The Congregation owned 37 such houses across its Regions on 31 March 2017. The operation of the care homes is the responsibility of Nazareth Care Charitable Trust (herein known as “NCCT”). In addition, NCCT through subsidiary entities (collectively known as Nazareth Care) has developed three retirement villages in the UK, catering for older people who are looking for support while maintaining an independent lifestyle. They also operate one Day Nursery for young children and work with other religious orders supporting them to care for their older Sisters.

The legacy of our heritage continues today through our partnership with Nazareth Care carrying on our commitment to providing nursing and residential care, reaching out across communities to support the people in our care, regardless of their socioeconomic, ethnic, religious or spiritual background.

The accounts accompanying this report are those of The Congregation of the Sisters of Nazareth Charitable Trust which holds certain of the assets of the Congregation in England, Wales, Scotland and Northern Ireland and which is now responsible for the care of the Sisters in the UK region and for supporting and enabling the individual ministry of those Sisters.

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Mission Statement of the Sisters of Nazareth

“We, the Sisters of Nazareth, aim to share the love of God through our ministries of care and education and our openness to respond to the needs of the times.”

“Whatsoever you do to the least of my people you do to me.” Words of Jesus Christ (1 Matt 25:40)

Challenges

The Congregation’s main challenge going forward in this Region is the age and numbers of Sisters. We are currently 66 Sisters in this region divided into 11 Communities with only two under the age of 50 years. We are very fortunate however to have our Novitiate in Hammersmith, so we have a number of young women doing their novitiate training in the UK each year from other Countries.

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Message From The Regional Superior

The past year has been an extraordinary year for everyone due to COVID-19. The pandemic has hugely impacted lives, livelihoods, and economies across the world. Everyone has had to make some sacrifices and changes to their normal living.

Thankfully, there has been a speedy uptake of vaccinations. Our Care Homes, nurseries and villages managed very well to keep up with lateral flow and PCR testing, together with the additional paperwork, and all the infection control measures. As restrictions lessen, we pray that everyone will be safe and able to continue life as normal as possible taking all necessary precautions needed.

Nazareth Care commitment to the continued delivery of care and support to children and Residents in our care has been remarkable. Both Care staff and nursery staff have fought this pandemic on two fronts, professional and personal. They have truly demonstrated our core values. My special thanks to our CEO, Richard Whitby and his management team. Their response to the pandemic and the leadership of highly dedicated staff throughout this time has been amazing. My heartfelt gratitude to all who have responded so generously and courageously in such a difficult time.

We have seen in the past two years just how important technology has been for us, especially when physical distancing was necessary for the safety of all. We have been able to maintain close connection between all our Communities in the UK and globally.

We are delighted to have appointed John Graham as Finance officer for the sisters in the UK region. John has been involved with the sisters since 1985. We wish him every happiness in his new position.

Pope Francis frequently reminds us that care for our creation must also be one of our highest priorities. I am very pleased therefore that our Communities have been able to support some organisations in their work, such as those helping fight against human trafficking. Also, organisations such as beekeepers being able to share some of our outdoor space has been a very positive step. “To protect creation, to protect every man and every woman, to look upon them with tenderness and love is to open up a horizon of hope” (Pope Francis).

Sister Doreen Cunningham Regional Superior

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Yearly review

Christmas 2020 was one that many people will never forget. Restrictions meant that Christmas passed by very quietly. We were fortunate however to have a chaplain on site at most of our Nazareth Houses and Mass was celebrated. This was very important to our Residents, many of whom would never have had missed Christmas Mass in their life. Staff and Sisters tried to make Christmas Day as joyous an occasion as possible.

Bonnyrigg

Our Community in Bonnyrigg had a virtual prayer service every Wednesday during the season of Lent and had virtual Stations of the Cross every Friday. Many people linked into these services from near and far. The wonders of technology! All of our Communities had various services to mark different occasions in the church calendar and within our congregation.

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Finchley, Cheltenham and Glasgow Communities
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Year Of Saint Joseph

Pope Francis declared a special Year of St Joseph to mark the 150[th] anniversary of Bl Pius IX’s proclamation of St Joseph as Patron of the Universal Church. The Year of St Joseph is running from Tuesday, 8 December 2020, to Wednesday, 8 December 2021. The Sisters in each Community discussed things that they would make a special effort to do during this year dedicated to St Joseph, one of which was a 3-day virtual retreat for all our Communities in the UK, facilitated by Fr John Cullen. Pope Francis says that “we are fragile beings, but we know how to pray, this is our greatest dignity and it is also our strength”

Golden Opportunities

Many of our Communities made use of the ‘golden opportunity’ to make our gardens more colourful for everyone to enjoy. Sisters have encouraged painting, varnishing, outdoor walks, poetry and music sessions.

Sisters, residents and staff at Glasgow painted outdoor furniture and tyres to make the grounds more colourful.

A resident at Lancaster, upholstered these chairs with donated material. He also painted 14 garden benches. All at Nazareth House are truly grateful to him.

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Caring for Creation, our Health & Wellbeing

Children, Residents, Sisters and Staff, beekeeper groups and visitors are all able to enjoy the wildlife gardens and woods at our site in Lancaster.

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Lancaster
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Vocations

Although the pandemic has caused some interruption in vocation promotion activities, the ability to connect online with discerners has been a blessing. Several young women have remained in contact with our vocation director.

As Vocation Director Sister Frances Kelly continues to promote vocations for the Sisters of Nazareth here in the UK. As Religious Vocation Promoter for the Bishops Conference of England and Wales and Conference of Religious she also promotes vocations at national level. She is involved in coordinating many events around the UK. Although some of the planned events had to be cancelled or postponed due to the pandemic, many were able to go ahead virtually and there was a wonderful uptake in these events.

Come and See Weekend

The master plan of vocational promotion to consecrated life is that which the Lord himself began when he said to the apostles John and Andrew “Come and See” (Jn 1:39). Sr Frances managed to arrange a ‘Come and See’ weekend just as we came out of lockdown. It was truly lovely to meet these young women as they decern their future. Sr Frances continues to keep in contact with them.

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Trustees’ Report

31 March 2021

The Trustees present the report and accounts for the year ended 31 March 2021 of the Congregation of the Sisters of Nazareth Charitable Trust (“the Charity”), which operates throughout the United Kingdom (UK).

– The accounts have been prepared in accordance with the accounting policies set out on pages 28 32 of the attached accounts. They 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 Standard applicable in the United Kingdom and Republic of Ireland (FRS 102), effective from accounting periods commencing 1 January 2015 or later.

Impact of Covid-19 on Nazareth House Care Village Belfast

The greatest initial challenge presented by Covid-19, was in dealing with the initial unknowns and associated levels of anxiety of both internal and external stakeholders.

Internally, we have managed Covid-19 through a combination of enhanced levels of staff training; best practice management sharing across Irish region; resident visitation restrictions; initially directly sourcing PPE and through the elimination of 3rd party agency staff, all as part of our risk based approach. Externally, we have sought to deliver enhanced next of kin and resident communications due to visitor restrictions. We have also successfully addressed significantly increased levels of regulatory compliance and public health guidance requirements.

The nature of this virus makes managing all of these associated, fast moving variables, a continuous daily challenge as we strive to meet the care needs of our residents.

Assessment of going concern

The Trustees have assessed whether the use of the going concern assumption is appropriate in preparing these accounts. The Trustees have made this assessment in respect to a period of one year from the date of approval of these accounts.

The Trustees of the Charity have concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the Charity to continue as a going concern. The Trustees are of the opinion that the Charity will have sufficient resources to meet its liabilities as they fall due. The most significant areas of judgement that affect items in the accounts are detailed within the Principal accounting policies under Critical accounting estimates and areas of judgement.

With regard to the next accounting period, the year ending 31 March 2022, our planning processes, including financial forecasts, take into consideration the current economic climate and its potential impact on the various sources of income and planned expenditure.

Looking forward to twelve months from the date of signing up to December 2022, the Charity's forecast, along with a cash flow forecast and scenario planning, show that the Charity has sufficient funds and liquidity to enable it to remain a going concern.

Achievements and results

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The introduction of new technology has been more important than we had ever imagined pre-covid. Having access to ‘Microsoft Teams’ has enabled close communication between our Houses. Sisters and General managers have been having monthly business meetings with NCCT Regional Team. Both Sisters and Managers have found these meetings very helpful. We have also been able to attend staff meetings remotely which was an excellent way to keep in touch throughout the pandemic. This technology has also enabled global Congregational meetings.

Newly professed Sisters

We have again this year experienced the great joy of sharing in the celebration of the first professions of three young sisters, Sr Nancy, Sr Juliana, and Sr Josee. Their Professions took place at our Hammersmith House and was greatly enjoyed by all the Sisters. The Sisters have returned to Africa where they will continue living out their religious life.

We have had five new novices come from Africa and Australia to do their Novitiate training, part of which involves spending time in the various Nazareth Houses. They always enjoy their experience with Residents and Children and their help is always greatly appreciated by Sisters and Staff.

Five new Novices with their Novice Director, Sister Bernadette Mc Call.

Birkenhead Refurbishment

Our Birkenhead Community has been watching the Care Home transformation through the year. As well the refurbishment of the existing Care home, a new 8 bedded wing has been built following the demolishment of the former convent. There has been some delay as expected during the pandemic, but the project is almost complete. A new garden area is currently being planned for all to enjoy, residents, their families and friends, sisters and staff.

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Northampton roof

Nazareth House Northampton has had part of its roof replaced and new fascia board makes the house more attractive.

Cardiff Kitchen

Our Cardiff Care Home has had a full kitchen refurbishment fitted with high standard equipment.

The year has also had its challenges. The issue of historic abuse of children in the Congregation’s care continues to impact on our activities today. In May 2019, a report was issued by the Scottish Child Abuse Inquiry following the testimony in 2018 of the survivors of abuse in four residential children’s homes in Scotland operated by the Congregation. The Congregation formally apologised for any mistreatment of those in our care and deeply regrets any harm or shortcomings in the care that was provided. The Congregation has and continues to co-operate with the Scottish Inquiry.

All of our Communities in England and Wales will be joining the new Religious Life Safeguarding Service which all religious have been invited to join. Following the Elliot report, the plan is to have a ‘one church’ approach. We will be offered training and support and be regularly audited. Survivors of abuse within the church will be very much supported within this new project.

The year was dominated by Covid-19 pandemic curtailing activities. Visiting was restricted in keeping with government rules. This was extremely difficult for residents and their families. However, the Trustees pay special tribute to all who have worked tirelessly throughout the pandemic to try to keep everyone as safe as possible and who found initiatives to keep residents connected with their loved ones.

One of our objectives is to protect and strengthen our patrimony, heritage, charism, mission and values. We will be able to measure this subjectively through the core values audit performed by our Sisters.

Future plans

A new programme commenced in 2021 called ‘The Gift of Victoire’s Legacy’ incorporating interculturality, Core Values and Safeguarding. A Sister and a member of the Regional team will be delivering training to all Sisters and Staff throughout the UK Region. Our long term goal is to have Sisters and Staff jointly and actively engaged in this programme with a link group for each site consisting of Staff and at least one Sister. Unfortunately, the delivery of the programme has been hindered by the pandemic restrictions.

Greater work is planned in relation to Pastoral Care including the appointment of Pastoral Care Coordinators in some areas as well as the designation of specific pastoral care rooms in each House. Further training is being developed to help staff understand what is important to people of varying religions and to be able to support everyone to the best of our ability.

The redevelopment/refurbishment of Nazareth House Hammersmith is to commence in 2022. Plans are currently being discussed.

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Management and Trustees

Governance

The worldwide Congregation is governed by the Superior General and her General Council, who together with supporting staff, are referred to as ‘the Generalate’. They are elected by the Congregation’s General Chapter which meets in session every six years: the 26[th] such Chapter took place in June 2018. Those elected may only serve a maximum of two consecutive 6 year terms in the same office.

In the UK, the Congregation was incorporated under the name of ‘The Congregation of the Sisters of Nazareth Charitable Trust’ by order of the Charity Commission on 7 October 2005, (Charity Registration Numbers: 228906 (in England and Wales) and SCO40507 (in Scotland)).

The Charity is governed by a Deed of Trust dated 16 January 2005.

The Superior General appoints the Trustees of the Charity. As all Trustees are Sisters, they have a detailed knowledge of the work and structure of the Charity.

Following their appointment, new Trustees work for a time alongside existing Trustees. They also meet with the Charity’s senior staff and its legal, accounting, investment and property advisers to obtain a full brief on their responsibilities and to fully acquaint them on the Charity’s position.

Details of the Trustees who were in office during the year or at the date on which this report was signed are set out below:

Current Trustees of the Charity

Sister Doreen Cunningham – Chair (from 7 October 2019)

‘Sister Doreen Marie trained as a Registered Nurse in Liverpool and has a degree in Health and Social Care. She also completed a Postgraduate Diploma in leadership and management at Loughborough University. She has worked in a number of our homes in the UK. From 2018 until October 2019, she held the position of Chief Nursing Officer for Nazareth Care Charitable Trust, UK Region. In July 2019 she was appointed to take position as UK Regional Superior and Chair of the Charity effective from October 2019.

Sister Teresa Bernadette Fallon

Sister Teresa trained as a Registered General Nurse at Southampton University Hospital in the 1970s and has worked as a care home manager at several Nazareth Houses in the United Kingdom, Northern Ireland and Australia. She has completed courses on Social Work Management, Health Education and Continuing Care of the Dying Patient and Family. She was appointed Superior at Nazareth House Cheltenham in 2006 and became a Regional Councillor for the UK Region in November 2012 and reappointed in 2019. She was appointed Superior to Nazareth House Cardiff in October 2013 to October 2019 and then appointed as Superior to Nazareth House Finchley in 2020.

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Sister Madeleine Merriman

Sister Madeleine Carmel Merriman has completed a Postgraduate Diploma in Leadership and Management at Loughborough University. She has worked as a Child Care Manager in several houses in the UK and served on a board of school governors for 10 years. Sister completed a Diploma in Counselling at the University of Lancaster. She was appointed as Superior at Nazareth House Northampton in 2009, at Crosby in 2013, and at Southend in 2016 until it closed in April 2020. She was appointed Superior in Cardiff in May 2020. She was appointed Regional Councillor in 2014 for the UK Region and reappointed in 2019.

Key management personnel

The Trustees consider that they together with the Chief Executive Officer and the senior management team comprise the key management of the Charity in charge of directing and controlling, running, and operating the Charity on a day to day basis.

All Trustees are members of the Congregation and whilst their living and personal expenses are borne by the Charity, they receive no remuneration or reimbursement of expenses in connection with their duties as Trustees.

The pay of the Chief Executive Officer and senior management team is reviewed annually.

Trustees’ Responsibilities Statement

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

The law applicable to charities in England and Wales and in Scotland requires the Trustees to prepare accounts for each financial year giving a true and fair view of the state of affairs of the Charity and of the income and expenditure of the Charity for that period.

In preparing these accounts, the Trustees are required to:

Observe the methods and principles in 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).

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presume that the Charity will continue in operation.

The Trustees are responsible for keeping 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, applicable Charity (Accounts and Reports) Regulations, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 and the provisions of the Charity’s Trust Deed. 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.

Structure and Management Reporting in the UK

The Congregation in the UK (England, Wales, Scotland and Northern Ireland) comprises of 11 communities of Sisters each of which is the responsibility of the Regional Superior and her Council. Each community has a Sister Superior. Throughout the year there is regular contact and communication between each of the communities and the Regional team.

Since April 2012, care homes and nurseries in the UK have been managed by Nazareth Care Charitable Trust, operating under the auspices of the Congregation of the Sisters of Nazareth UK Region. The UK regional office is based in the grounds of Nazareth House Finchley, in North London.

The Charity’s Trustees continue to be supported by the senior management team of Nazareth Care Charitable Trust which acts in an advisory capacity to the board and assists in the review of the Congregation’s business focus. When necessary, the Trustees seek advice and support from the Charity’s professional advisers, including property consultants, solicitors, and accountants.

Fundraising

The Trust is committed to high standards in fundraising. We are registered with the Fundraising Regulator and continue to monitor and update our data protection policies to make sure that our fundraising activities and communications with our Friends and supporters comply fully with the latest regulations.

Our fundraising materials and communications clearly highlight that:

We ensure that our fundraisers receive relevant training and have access to coaching. We treat all donors with dignity and compassion.

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Risk management

The Trustees, with the assistance of the Charity’s senior management team, have identified and considered the key risks that the Charity might be exposed to and have developed a risk register. The risks include those relating to the operation of the care homes and nursery, those relating to the development of retirement villages and the sale and subsequent resale of apartments. Actions are agreed to monitor and mitigate the risks identified.

Below are four key risks faced by the Charity

1. Historical allegations and public inquiries

The Congregation was involved in child care until the 1980s. Due to the Congregation's involvement with both the Independent Inquiry into Child Sexual Abuse and the Scottish Inquiry into Child Sexual Abuse, many children formerly cared for in our children’s homes are coming forward with historical allegations. There is a risk of reputational damage to the Sisters and the Congregation.

Actions taken to mitigate the risk

A Sister is appointed as the Safeguarding Co-Ordinator for the Region. All allegations are dealt with in a timely manner and reported to the relevant bodies, police, solicitors, insurance, and safeguarding commission. Where possible, former residents of the children's homes are welcome to one of our houses and they can speak in confidence to a Sister if that is their wish. Sometimes a listening ear makes all the difference. Posters are on display in all of our Homes in relation to contact details in the event of a safeguarding concern. Sisters as wells as staff receive safeguarding training at least yearly. Sisters and staff have DBS checks every 3 yearly in England, Wales, and Scotland. Following the Elliot report, the church is trying to create a ‘One church’ approach and safeguarding to move forward in response to the report. We have attended many virtual meetings through the year regarding this new approach and are cooperating with the Religious Life Safeguarding Service and the CSSA.

The issue of historic abuse of children in the Congregation’s care continues to impact on our activities today. In May 2019, a report was issued by the Scottish Child Abuse Inquiry following testimony in 2018 of the survivors of abuse in four residential children’s homes in Scotland operated by the Congregation. The Congregation formally apologised for any mistreatment of those in our care and deeply regrets any harm or shortcomings in the care that was provided. The Congregation has and continues to co-operate with the Scottish Inquiry. Evidence has been given to the Inquiry, most recently in October 2020 relating to child migration. In addition, we continue to co-operate with the Scottish Government with their Advance Payment Scheme and the development of redress Scotland, following the passing of the Redress for Survivors (Historical Child Abuse in Care) (Scotland) Act 2021, to support the survivors on abuse.

2. COVID-19 poses a risk to our residents, staff and sister’s safety

Actions we have taken to mitigate the risk:

COVID-19 is an invisible and deadly virus that poses a risk to Residents, Staff and Sisters. We cannot remove the risk that the virus poses. However, we take every possible step to reduce the exposure of the virus in our homes i.e.:

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3. Implementation of General Data Protection Regulation

The implementation of the General Data Protection Regulations in May 2018 has required a reform in the way in which the charity manages its data and where the data will be held.

Actions taken to mitigate the risk:

The current data protection regulations are managed by the Data Protection Officers, that will continue to be responsible for data management as the new regulations come into being. Additional staff within the regional team have been employed and are in the process of establishing a central archiving system and managing the new data protection requirements.

4. Income and Cash Flow

Funding and Cashflow are insufficient to support ongoing operations.

Actions taken to mitigate the risk:

Income and Expenditure

A summary of the results can be found on page 24 of the attached accounts.

Income was to £6.7 million (2020: £6.7 million) with £1.2 million being generated from donations and legacies. Also within this total is operational income from the one care establishment for older people still operated by the Charity in Northern Ireland, which amounted to £4.0 million.

Expenditure amounted to £7.4 million (2020: £10.4 million).

Financial position

The balance sheet shows total funds of £38.7 million (2020: £39.3 million).

Reserves Policy

Unrestricted funds at 31 March 2021 amounted to £38.4 million and comprised one designated fund and the general fund.

The tangible fixed assets fund totalling £32.8 million, represents the net book value of the Charity’s land

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and buildings and other tangible fixed assets (excluding those used in respect to the provision of residential care for older people in one home in Northern Ireland), less loans that are being used to finance the refurbishment and development of property owned by the Charity. These net assets are essential to the continued mission of the Charity and include care establishments leased to Nazareth Care Charitable Trust.

The general fund totalling £5.6 million, comprises those assets not designated by the Trustees or restricted in their application as of 31 March 2021. The fund includes monies to cover temporary shortfalls in income due to timing differences and amounts to enable the Charity to cope with unforeseen emergencies.

The aim of the Trustees is that the general fund (or free reserves) should equate to between six- and twelvemonths’ ongoing expenditure. On 31 March 2021, the Trustees believe the Charity’s free reserves to be adequate but not excessive. The general fund of £4.3 million would cover six months ongoing expenditure.

The Charity holds one restricted fund totalling £283,370. The balance of the restricted fund of £283,370 comprises the balance of past property proceeds from the disposal of a property in Wavertree, in the Roman Catholic Archdiocese of Liverpool, which are restricted to use within the Archdiocese.

Discontinued Operations

From April 2021 the charity discontinued its operations in Belfast. All operations and staff were transferred to Nazareth Care Ireland CLG, an Irish based charity with a registered trading name of Nazareth House Care Village Belfast. The income and expenditure associated with Belfast are therefore disclosed as discontinued operations in the Statement of Financial Activities.

Employees, Volunteers and Members of the Congregation

The Trustees wish to record their recognition and appreciation for the professionalism and commitment of all their staff, volunteers and individual members of the Congregation.

Our employed staff are clearly our biggest asset, and we thank them for the contribution that they make. NCCT strives to provide excellent working conditions for its staff. We aim to provide an open and inclusive environment where every member of staff is empowered to make a real difference.

The majority of our houses also have a Friends of Nazareth group operating within them, which is a team of dedicated volunteers who give their time to a number of causes. Volunteers can be fundraisers or visitors. The Trust has recognised that if we are to continue to provide an excellent service to our residents against a backdrop of financial pressures, then we need to extend the use of volunteers to raise funds for those extra items and activities that our service users require.

Approved by the Trustees and signed on their behalf by:

Sister Doreen Marie Cunningham Trustee and Regional Superior

Date approved: 24.11.2021

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Independent Auditor’s Report to the Trustees of The Congregation of the Sisters of Nazareth Charitable Trust 31 March 2021

Opinion

We have audited the financial statements of The Congregation of the Sisters of Nazareth Charitable Trust (‘the charity’) for the year ended 31 March 2021 which comprise the statement of financial activities, the balance sheet, the statement of cash flows and notes to the financial statements, including 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:

give a true and fair view of the state of the Charity’s affairs as at 31 March 2021 and of its income and expenditure, for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Charities Act 2011, the Charities and Trustee Investment (Scotland) Act 2005 and Regulations 6 and 8 of the Charities Accounts (Scotland) Regulations 2006 (amended).

Basis for opinion

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 charity 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 trustee's 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 charity's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

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The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

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 this gives rise to a material misstatement in the financial statements themselves. 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 and the Charities Accounts (Scotland) Regulations 2006 requires us to report to you if, in our opinion:

the information given in the financial statements is inconsistent in any material respect with the trustees’ report; or

sufficient and proper accounting records have not been kept by the charity; or

the financial statements are not in agreement with the accounting records and returns; or

we have not received all the information and explanations we require for our audit.

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 15, 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 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 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.

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Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.

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.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charity operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Charities Act 2011 and The Charities and Trustee Investment (Scotland) Act 2005, together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charity’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charity for fraud. The laws and regulations we considered in this context for the charity were Care Quality Regulations (RQIA) for service providers and managers, General Data Protection Regulation (GDPR), Health and safety legislation and Employment legislation.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing of recognition of income, recording the impact of care quality regulatory reviews, and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission, and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect noncompliance with all laws and regulations.

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Use of our report

This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008 and Regulation 10 of the Charities Accounts (Scotland) Regulations 2006. 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 and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Crowe U.K. LLP

Statutory Auditor

For and on behalf of Crowe U.K. LLP

London

Date 9th December 2021

Crowe U.K. LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.

Crowe U.K. LLP is eligible for appointment as auditor of the charity under regulation 10(2) of the Charities Accounts (Scotland) Regulations by virtue of its eligibility under section 1212 of the Companies Act 2006.

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Statement of Financial Activities Year ended 31 March 2021

Continuing operations Continuing operations Discontinued operations
Unrestricted Restricted
Unrestricted		 Restricted 2021
 Unrestricted Restricted 2020
funds funds
funds		 funds Total funds
 funds funds Total funds
Notes
£		 £
£		 £ £ £ £ £
Income:
Donations and legacies 1
914,872		 199,607
124,428		 1,034 1,239,941 1,038,861 301,178 1,340,039
Investment income and interest 2
receivable 89,034 89,034 89,484 — 89,484
Rental income 1,361,252 — 1,361,252 1,276,533 — 1,276,533
Charitable activities
. Charges for residential and care
services for adults — 4,017,891 4,017,891 3,936,796 — 3,936,796
Other income
. Miscellaneous income 1,558 — 29,355 30,913 68,316 — 68,316
Total income 2,366,716 199,607
4,171,674		 1,034 6,739,031 6,409,990 301,178 6,711,168
Expenditure:
Charitable activities
. Provision of residential and care
services for adults and support of 3
the Sisters and their ministry 2,765,586 199,607
4,378,813		 1,034 7,345,040 6,714,238 349,798 7,064,036
. Donation to Nazareth
Care Charitable Trust 21
(Registered Charity No.
1113666) 93,745 — 93,745 75,000 — 75,000
. Impairment of freehold property 9
—		 — — —
(Profit)/Loss on disposal of asset (45,117) — (45,117) 3,291,764 — 3,291,764
Total expenditure 2,814,214 199,607
4,378,813		 1,034 7,393,668 10,081,002 349,798 10,430,800
Net (expenditure)
income before net gains
on investment properties (3,671,012) (48,620) (3,719,632)
Net realised gains on disposal of 10
investment properties — — — —
Net (expenditure) income and net
movement in funds		 5
(447,498)		 (207,139) (654,637) (3,671,012) (48,620) (3,719,632)
Reconciliation of funds:
Fund balances brought forward at 1
April 2020 37,380,879 283,370
1,657,880		 39,322,129 42,709,771 331,990 43,041,761
Fund balances carried forward at 31 18
March 2021 36,933,381 283,370
1,450,741		 38,667,492 39,038,759 283,370 39,322,129

Please see note 23 on discontinued operations.

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Balance Sheet

31 March 2021

Notes 2021
£		 2021
£		 2020
£		 2020
£
Fixed assets
Tangible assets
9
Investment properties
10
Current assets
Debtors: amounts falling due after one
year
11
Debtors: amounts falling due within one
year
12
Cash at bank and in hand
Current liabilities
Creditors: amounts falling due
within one year
13
Net current assets
Total assets less current liabilities
Creditors:amounts falling due after one
year
14
Total net assets
The funds of the charity:
Restricted funds
15
Unrestricted funds
. Tangible fixed assets fund
16
. Designated funds
17
. General fund		 114,660
491,813
5,621,503		 41,476,108
471,186		 132,660
1,392,374
4,416,718		 41,927,473
471,186
41,947,294
4,096,664		 42,398,659
2,049,870
6,227,976
(2,131,312)		 5,941,752
(3,891,882)
33,799,415
1,501,269
3,738,075
44,448,529
(5,126,400)
39,322,129
283,370
38,384,122		 283,370
39,038,759
38,667,492 39,322,129

Approved by the Trustees and signed on their behalf by:

Sister Doreen Cunningham Chair of Trustee Date of approval: 24.11.2021

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Statement of cash flows

Year ended 31 March 2021

Notes 2021
£		 2020
£
Cash flow from operating activities:
Net cash provided by operating activities
A
Cash flow from investing activities:
Interest and rents from investments
Proceeds from the disposal of tangible fixed assets
Purchase of tangible fixed assets
Proceeds from the disposal of investments
VAT refund receivable
Net cash used in investing activities
Cash flow from financing activities:
Repayments of borrowing
Cash inflows from new borrowing
Net cash (used in) provided by financing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at 1 April 2020
B
Cash and cash equivalents at 31 March 2021
B		 2,034,860 914,573
89,034
324,000
(1,587,952)
—
—		 89,484
469,800
(1,782,091)
—
—
(1,174,918) (1,222,807)
(626,924)
971,767		 (1,154,840)
1,471,501
344,843 316,661
1,204,785
4,416,718		 8,427
4,408,291
5,621,503 4,416,718

Notes to the statement of cash flows for the year to 31 March 2021

A Reconciliation of net movement in funds to net cash provided by operating activities

2021
£		 2020
£
Net movement in funds (as per the statement of financial activities)
Adjustments for:
Depreciation charge
Gains on investments
Impairment loss
Net (gain) loss on disposal of tangible fixed assets		 (654,637)
1,701,694
—
(45,117)		 (3,719,632)
1,757,003
—
3,291,764

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Interest and rents from investments
(Increase) decrease in debtors
(Decrease)/Increase in creditors
Net cashprovided by operating activities		 (89,034)
1,009,669
112,285		 (89,484)
(304,196)
(20,882)
2,034,860 914,573

B Analysis of cash and cash equivalents

2021
£		 2020
£
Total cash and cash equivalents:Cash at bank
and in hand		 5,621,503 4,416,718

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Principal Accounting Policies 31 March 2021

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the accounts are laid out below.

Basis of preparation

These accounts have been prepared for the year to 31 March 2021 with comparative information given in respect to the year to 31 March 2020.

The accounts have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant accounting policies below or the notes to these accounts.

The accounts have been prepared in accordance with 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 United Kingdom and Republic of Ireland (FRS

102) (Charities SORP FRS 102) issued on 16 July 2014, the Charities Act 2011 and the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006 and UK Generally Accepted Practice as it applies from 1 January 2015.

The accounts (financial statements) 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 the 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 on 16 July 2014 rather than the previous Statement of Recommended Practice: Accounting and Reporting by Charities which was effective from 1 April 2005 but which has since been withdrawn.

The Charity constitutes a public benefit entity as defined by FRS 102.

The accounts are presented in sterling and are rounded to the nearest pound.

Critical accounting estimates and areas of judgement

Preparation of the accounts requires the Trustees and management to make significant judgements and estimates.

The items in the accounts where these judgements and estimates have been made include:

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Assessment of going concern

The Trustees have assessed whether the use of the going concern assumption is appropriate in preparing these accounts. The Trustees have made this assessment in respect to a period of one year from the date of approval of these accounts.

The Trustees of the Charity have concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the Charity to continue as a going concern. The Trustees are of the opinion that the Charity will have sufficient resources to meet its liabilities as they fall due. The most significant areas of judgement that affect items in the accounts are detailed above under Critical accounting estimates and areas of judgement.

The most significant areas of judgement that affect items in the accounts are detailed in the Critical accounting estimates and areas of judgement section.

With regard to the next accounting period, the year ending 31 March 2022, our planning processes, including financial forecasts, take into consideration the current economic climate and its potential impact on the various sources of income and planned expenditure.

Looking forward to twelve months from the date of signing up to December 2022, the Charity's forecast, along with a cash flow forecast and scenario planning, show that the Charity has sufficient funds and liquidity to enable it to remain a going concern.

Income recognition

Income is recognised in the period in which the Charity has entitlement to the income, the amount of income can be measured reliably, and it is probable that the income will be received.

Income comprises donations and legacies, investment income and interest receivable, rental income, charges for residential and care services and other income.

Donations, including salaries and pensions of individual religious received under Gift Aid or deed of covenant, are recognised when the Charity has confirmation of both the amount and settlement date. In the event of donations pledged but not received, the amount is accrued for where the receipt is considered probable. In the event that a donation is subject to conditions that require a level of performance before the Charity is entitled to the funds, the income is deferred and not recognised until either those conditions are fully met, or the fulfilment of those conditions is wholly within the control of the Charity, and it is probable that those conditions will be fulfilled in the reporting period.

In accordance with the Charities SORP FRS 102 volunteer time is not recognised.

Legacies are included in the statement of financial activities when the Charity is entitled to the legacy, the executors have established that there are sufficient surplus assets in the estate to pay the legacy, and any conditions attached to the legacy are within the control of the Charity. Legacies are treated as restricted income in the statement of financial activities as they are restricted to the community that receives them.

Entitlement is taken as the earlier of the date on which either: the Charity is aware that probate has been granted, the estate has been finalised and notification has been made by the executor to the Charity that

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a distribution will be made, or when a distribution is received from the estate. Receipt of a legacy, in whole or in part, is only considered probable when the amount can be measured reliably, and the Charity has been notified of the executor’s intention to make a distribution. Where legacies have been notified to the Charity, or the Charity is aware of the granting of probate, but the criteria for income recognition have not been met, then the legacy is treated as a contingent asset and disclosed if material. In the event that the gift is in the form of an asset other than cash, or a financial asset traded on a recognised stock exchange, recognition is subject to the value of the gift being reliably measurable with a degree of reasonable accuracy and the title of the asset having being transferred to the Charity.

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the Charity; this is normally upon notification of the interest paid or payable by the bank.

Rental income is recognised when payment is due under the terms of the relevant rental or lease agreement.

Income derived from the levying of charges for residential, care and support services is measured at the fair value of the consideration received or receivable, excluding discounts and rebates.

Expenditure recognition

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the Charity to make a payment to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably.

All expenditure is accounted for on an accrual’s basis. The classification between activities is as follows:

Grants payable are included in the statement of financial activities when approved and when the intended recipient has either received the funds or been informed of the decision to make the grant and has satisfied all performance conditions. Grants approved but not paid at the end of the financial year are accrued. Grants where the beneficiary has not been informed or has to fulfil performance conditions before the grant is released are not accrued for but are disclosed as financial commitments in the notes to the accounts.

In allocating expenditure to headings, no significant apportionments have had to be used. All expenditure is stated inclusive of irrecoverable VAT.

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Governance costs

Governance costs include expenditure on compliance with constitutional and statutory requirements and have been allocated entirely to the expenditure on provision of residential and care services for adults and the support of the Sisters and their ministry.

Tangible Fixed Assets

All assets and improvements to existing assets with a cost of more than £1,500 and with an expected useful life exceeding one year are capitalised. The Charity has opted to adopt a policy of not revaluing its tangible fixed assets, which are stated at cost.

A review for impairment of a tangible fixed asset is carried out if events or changes in circumstances indicate that the carrying amount of any tangible fixed asset may not be recoverable.

Freehold Land and Buildings

Freehold land and buildings are included at cost, net of depreciation and any impairment provision.

Freehold buildings are depreciated from their first complete year of occupation at a rate of 2% per annum on the straight-line basis in order to write the cost of each building off over its estimated useful economic life to the Charity.

Long Leasehold Buildings

Long leasehold buildings are included at cost and are depreciated once the lease reduces to 50 years at a rate of 2% per annum on the straight-line basis.

Other Tangible Fixed Assets

Other tangible fixed assets are capitalised and depreciated at the following annual rates in order to write them off over their estimated useful lives:

Fixed Asset Investment Properties

Investment properties are included on the balance sheet at their open market value at the end of the financial period. Realised and unrealised gains (or losses) are credited (or debited) to the Statement of Financial Activities in the year in which they arise. In accordance with the Charities SORP FRS 102, no depreciation is charged against investment property.

Debtors

Debtors are recognised at their settlement amount, less any provision for non-recoverability. Prepayments are valued at the amount prepaid. They have been discounted to the present value of the future cash receipt where such discounting is material.

Cash at bank and in hand

Cash at bank and in hand represents such accounts and instruments that are available on demand or have a maturity of less than three months from the date of acquisition. Deposits for more than three months but

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less than one year have been disclosed as short term deposits. Cash placed on deposit for more than one year is disclosed as a fixed asset investment.

Creditors and provisions

Creditors and provisions are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Creditors and provisions are recognised at the amount the Charity anticipates it will pay to settle the debt. They have been discounted to the present value of the future cash payment where such discounting is material.

Funds Structure

Restricted funds represent voluntary income received to the benefit of specific homes whose assets are otherwise unrestricted. Such income is usually expended within the financial year in which it is received. Details of unexpended balances, if any, are provided in note 15.

The remainder of the Charity’s funds are unrestricted. The general fund comprises those monies which may be used towards meeting the charitable objectives of the Charity and which may be applied at the discretion of the Trustees.

Within the unrestricted funds the Trustees have designated amounts for specified purposes. Details of these are given in note 17.

Within the unrestricted funds there is also the tangible fixed assets fund which represents the net book value of the Charity’s land and buildings and other tangible fixed assets less loans that are being used to finance the refurbishment and development of property owned by the Charity.

Services Provided by Members of the Congregation

For the purposes of these accounts, no monetary value has been placed on the care, administrative and other services provided by the members of the Congregation.

Pension costs

All eligible members of staff are auto-enrolled in a workplace pension scheme. Employer contributions to the scheme are charged to the statement of financial activities in the year in which they are payable to the scheme.

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Notes to the Accounts 31 March 2021

1. Donations and Legacies

Legacies
Covenanted salaries and pensions of
individual religious
Covenanted stipends received by
individual religious
Glasgow Building Fund donations
Other donations
Total funds		 Unrestricted
funds
£
Restricted
funds
£		 Total
2021
£
Unrestricted
funds
£
Restricted
funds
£
Total
2020
£
—
571,260
468,040
—
—		 112,026
—
—
88,615		 112,026—
82,626
82,626
571,260615,931
—
615,931
468,040422,930
—
422,930
—
45,981
45,981
88,615
—
172,571
172,571
1,039,300 200,641 1,239,9411,038,861
301,178
1,340,039

Covenanted salaries and pensions and covenanted stipends represent the salaries and pensions and stipends respectively of individual Sisters donated by the relevant Sister to the Charity under a deed of covenant.

2. Investment Income and Interest Receivable

£ Unrestricted
funds		 Restricted
funds
£		 Total 2021
£
Unrestricted
funds
£
Restricted
funds
£
Total 2020
£
Income from rental
properties
Bank interest
Total funds		 88,762
272		 —
—		 88,762
87,048
—
87,048
272
2,436
—
2,436
89,034 — 89,034
89,484
—
89,484

3. Provision of Residential and Care Services for Adults and Support of the Sisters and their Ministry

Staff costs
Premises
Care and welfare
Management and
administration of the
Care Homes
Depreciation
Governance costs (note 4)
Total funds		 Unrestricted
funds
£
2,349,539
527,510
1,558,644
986,132
1,701,694
20,880		 Restricted
funds
£
180,577
20,064
—
—
—
—
200,641		 Total
2021
£
Unrestricted
funds
£
Restricted
funds
£
Total
2020
£
2,530,116
2,206,286
314,318
2,520,604
547,574
560,195
35,480
595,675
1,558,644
1,543,054
—
1,543,054
986,132
605,160
—
605,160
1,701,694
1,757,003
—
1,757,003
20,880
42,540
—
42,540
7,144,399 7,345,040
6,714,238
349,798
7,064,036

The costs of providing residential and care services include the living and personal expenses of individual Sisters, all of whom are either directly or indirectly involved in such work.

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4. Governance Costs

Unrestricted
funds
£		 Restricted
funds
£		 Total 2021
£
Unrestricted
funds
£
Restricted
funds
£
Total
2020
£
Audit and accountancy
services
20,880		 — 20,880
42,540
—
42,540
Total
20,880		 — 20,880
42,540
—
42,540

5. Net (Expenditure) Income and Net Movement in Funds

This is stated after charging:

Total
2021
£		 Total
2020
£
Staff costs (note 6)
Auditor’s remuneration and audit costs, including VAT
. Statutory audit
. Statutory audit (2018/19)
Impairment of freehold property
Depreciation		 2,530,116
20,880
—
1,701,694		 2,520,604
22,200
20,340
—
1,757,003

6. Staff Costs and Remuneration of Key Management Personnel

Staff costs during the year were as follows:

Staff costs during the year were as follows:
2021
£		 2020
£
Wages and salaries
Social security costs
Other pension costs
Payments to agency staff
Staff costs per function were as follows:
Provision of residential and care services		 2,288,096
158,789
41,468		 2,106,379
140,499
37,670
2,488,353
41,763		 2,284,548
236,056
2,530,116 2,520,604
2,530,116 2,520,604

There was one employee (2020 – one) earning £60,000 per annum or more (including taxable benefits but excluding employer pension contributions).

2021
Number
2020
Number
1
1
£60,000 - £70,000
£70,001 - £80,000

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The average number of employees during the year was:

The average number of employees during the year was:
Total
2021		 Total
2020
Provision of care, including residential and nursing care homes 169 164

The key management personnel of the Charity in charge of directing and controlling, running and operating the Charity on a day to day basis comprise the Trustees, the Chief Executive Officer and the senior management team. The total remuneration (including taxable benefits and employer's pension contributions) of the key management personnel for the year was £154,366 (2020 - £183,000).

7. Trustees’ expenses and remuneration and transactions with Trustees

As members of the Congregation, the Trustees’ living and personal expenses during the year were borne by the Charity, but they received no remuneration or reimbursement of expenses in connection with their duties as Trustees or key management during the year (2020 - £nil).

As members of the Congregation, none of the Trustees have resources of their own as all earnings, pensions and other income have been donated to the Charity under a Gift Aid compliant Deed of Covenant. During the year, the total amount donated by the Trustees to the Charity was £35,143 (2020 - £39,229).

8. Taxation

The Congregation of the Sisters of Nazareth Charitable Trust is a registered charity and, therefore, is not liable to income tax or corporation tax on income or gains derived from its charitable activities, as they fall within the various exemptions available to registered charities.

9. Tangible Fixed Assets

Cost
At 1 April 2020
Additions
Disposal
At 31 March 2021
Depreciation and impairment
At 1 April 2020
Charge for year
Disposal
At 31 March 2021
Net book values
At 31 March 2021
At 1 April 2020		 Freehold land
and buildings
£
Long
leasehold
buildings
£
Furniture
and
equipment
£
Motor
vehicles
£
Total
£
60,442,681
104,500
2,648,338
252,802
63,448,321
1,364,240
—
214,423
9,289
1,587,952
(336,422)
—
(1,855,512)
(6,995)
(2,198,929)
61,470,499
104,500
1,007,249
255,096
62,837,344
18,961,201
14,630
2,361,178
183,839
21,520,848
1,579,709
2,090
100,165
19,730
1,701,694
71,235
—
(1,925,546)
(6,995)
(1,861,306)
20,612,145
16,720
535,797
196,574
21,361,236
40,858,354
87,780
471,452
58,522
41,476,108
41,481,480
89,870
287,160
68,963
41,927,473

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10. Investment Properties

Market value
At 1 April 2020
Disposals at book value (proceeds: £nil, gains: £nil)
At 31 March 2021		 2021
£
471,186
—
471,186		 2020
£
471,186
471,186

Investment properties are included above at estimated market value and are all located within Blackburn Retirement Village. Valuations were carried out on the investment properties during the year by local firm of estate agents. There are no restrictions on the disposal of the investment properties. Two of the five investment properties incur service charge costs while the other three properties are being rented.

11. Debtors: Amounts Falling Due After One Year

2021
£		 2020
£
Amount due from Nazareth Care Charitable Trust (note 21) 114,660 132,660

12. Debtors: Amounts Falling Due Within One Year

12. Debtors: Amounts Falling Due Within One Year
2021
£		 2020
£
Prepayments and accrued income
Charges for care services
Amount due from The Congregation of the Sisters of Nazareth Generalate
(note 21)
Amount due from Nazareth Care Charitable Trust (note 21)
Amount due from NRV (Blackburn) Limited (note 21)
Other debtors
Amounts due from NRV (Glasgow) Limited		 17,743
142,673
240,106
25,212
52,461
3,004
10,614		 14,575
166,606
240,106
128,992
122,463
719,632
—
491,813 1,392,374

13. Creditors: Amounts Falling Due Within One Year

13. Creditors: Amounts Falling Due Within One Year
2021
£		 2020
£
Expense creditors
Bank loans
Other creditors
Taxes and social security
Loan from the Congregation of the Sisters of Nazareth Generalate (notes 15
and 21)
Amount due to Nazareth Care Charitable Trust (note 21)
Accruals and deferred income
Amount due to NRV Development (Plymouth) Limited (note 21)		 75,396
271,476
724
39,637
249,600
683,345
571,028
240,106		 60,209
2,096,867
39,235
33,003
100,000
804,300
518,162
240,106
2,131,312 3,891,882

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14. Creditors: Amounts Falling Due After One Year

14. Creditors: Amounts Falling Due After One Year
2021
£		 2020
£
Loan from the Congregation of the Sisters of Nazareth Generalate (note 21)
Bank loans		 5,677,185
1,699,281		 3,159,575
1,966,825
7,376,466 5,126,400

The Charity signed a loan agreement with the Congregation of the Sisters of Nazareth Generalate (CSNG) in April 2020 in respect of an advancement of £4,614,832. The loan comprises two parts. Part A has already been advanced to the Region under a loan agreement dated 25 October 2013 and consists of the outstanding balance owing on the Funds Transfer Date, which is £2,736,729. Part B is the balance owing under a loan agreement with The Royal Bank of Scotland and repaid by the Generalate to The Royal Bank of Scotland on the Funds Transfer Date. The balance on this loan is £1,878,103.

The loan is repayable by 2036 with interest accruing at 3% per annum. The loan balance at 31 March 2021 was £4,399,919 (including interest of £136,903).

On 25 July 2018, the charity entered into a loan agreement for £1.5 million with the Congregation of the Sisters of Nazareth Generalate (CSNG) in order to fund the expansion and development of Nazareth House Birkenhead. The loan carries an interest rate of 3% and is fixed throughout the term of the loan. No repayment of the principle or interest will be required until one calendar year from the first quarter day after the completion date. The loan balance at 31 March 2021 was £1,526,866 (2020 – £524,869) including interest of £30,230 (2020 – £5,883).

On 2 March 2016, The Congregation of the Sisters of Nazareth Charitable Trust entered into a loan agreement for £1 million with Barclays Bank plc in order to fund the refurbishment of Nazareth House, Finchley. The loan carries an interest rate of 2.75% above the official Bank of England Base Rate and is due to be repaid within 5 years of the first drawdown of the Facility. The loan balance at 31 March 2021 was £697,934 (2020 - £764,664). £86,472 of the loan is repayable before 31 March 2021 (note 13). The loan is secured on Nazareth House, Finchley, of which the Charity is the freeholder.

On 11 November 2016, The Congregation of the Sisters of Nazareth Charitable Trust entered into a loan agreement for £1.5 million with Barclays Bank plc in order to fund the refurbishment of Nazareth House, Cheltenham. The loan carries an interest rate of 2.75% above the official Bank of England Base Rate and is due to be repaid within 5 years. The loan is secured on Nazareth House, Cheltenham. The loan balance at 31 March 2021 was £1,272,823 (2020 - £1,424,160). £185,004 of the loan is repayable before 31 March 2021 (note 13).

15. Restricted Funds

15. Restricted Funds
At 1 April
2020
£		 Income
£		 Expenditure
£
200,641
—
—		 At 31
March 2021
£
Restricted donations and legacies
Property proceeds under restrictive covenant		 —
283,370		 200,641
—		 —
283,370
283,370 — 283,370

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At 1 April
2019
£		 Income
£		 Expenditure
£		 At 31
March 2020
£
Restricted donations and legacies
Property proceeds under restrictive covenant		 48,620
283,370		 — (48,620)
—		 —
283,370
331,990 (48,620) 283,370

The restricted donations and legacies fund represents monies given specifically for the benefit of individual homes whose assets are otherwise unrestricted. The amounts include donations towards the rebuilding of Nazareth House Hammersmith.

Property proceeds under restrictive covenant represents the remaining balance of the proceeds of the disposal of a property in Wavertree, in the Roman Catholic Archdiocese of Liverpool, which are restricted to use within the Archdiocese.

16. Tangible fixed assets fund

16. Tangible fixed assets fund
At 31
March 2021
£		 Restated
At 31
March 2020
£
Tangible fixed assets
. At 1 April 2020
. Movements in the year
. At 31 March 2021
Less: Loans to finance refurbishment and development of property		 33,799,415
6,864,271		 34,999,523
6,123,159
40,663,686
(7,897,542)		 41,122,682
(7,323,267)
32,766,144 33,799,415

The tangible fixed assets fund represents the net book value of the Charity’s land and buildings and other tangible fixed assets (excluding those used in respect to the provision of residential care for older people in Northern Ireland) less loans that are to be used to finance the refurbishment and development of property owned by the Charity.

A decision was made to separate this fund from the general fund in recognition of the fact that the assets are used in the day to day work of the Charity, and the fund value would not be realisable easily if needed to meet future contingencies.

17. Designated Funds

The unrestricted funds of the Charity include the following designated funds, which have been set aside out of unrestricted funds by the Trustees for specific purposes:

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At 1
April 2020
£		 New
designations
£		 Utilised/
released
£		 At 31
March 2021
£
Total designated funds: Care services fund 1,501,269 — (1,501,269) —
At 1
April 2019
£		 New
designations
£		 Utilised/
released
£		 At 31
March 2020
£
Total designated funds 4,322,041 — (2,820,772) 1,501,269

The care services fund represented those net assets applied in the provision of care services at Nazareth House Belfast. From April 2021 the charity discontinued its operations in Belfast. The fund balance has been moved to the general fund.

18. Analysis of Net Assets Between Funds

18. Analysis of Net Assets Between Funds
Fund balances at 31 March 2021
are represented by:
Tangible fixed assets
Investments
Net current assets
Creditors: amounts falling due after one
year
Total net assets		 Restricted
funds
£
Designated
funds
£
Tangible
fixed assets
fund
£		 General
fund
£		 Total
2020
£
—
—
40,663,686
—
—
—
283,370
—
(521,076)
—
—
(7,376,466)		 812,422
471,186
4,334,370
—		 41,476,108
471,186
4,096,664
(7,376,466)
283,370
—
32,766,144		 5,617,978 38,667,492

No unrealised gains or losses on investment properties have arisen.

Restricted
funds
£
Designated
funds
£
Tangible
fixed assets
fund
£
—
804,791
41,122,682
—
471,186
—
283,370
225,292
(2,196,867)
—
—
(5,126,400)
283,370
1,501,269 33,799,415		 General
fund
£		 Total 2019
£
Fund balances at 31 March 2020
are represented by:
Tangible fixed assets Restated
Investments
Net current assets
Creditors: amounts falling due after one
year
Total net assets		 —
—
3,738,075
—		 41,927,473
471,186
2,049,870
(5,126,400)
3,738,075 39,322,129

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19. Contingent Liabilities

At 31 March 2021, The Congregation of the Sisters of Nazareth Generalate was funding legal and other costs incurred relating to statutory inquiries that have been established in Northern Ireland, Scotland and England and Wales, into the alleged historical abuse of children. The inquiries are at various stages, with the Historical Institutional Abuse Inquiry in Northern Ireland having reported in January 2017, the England and Wales Independent Inquiry into Child Sexual Abuse has published an interim report and continues to hear evidence, and the Scottish Child Abuse Inquiry publishing their report into the Sisters of Nazareth in May 2019.

The Congregation of the Sisters of Nazareth Generalate expects to incur further legal costs in relation to all three inquiries. It is not possible at the present time to provide any meaningful estimate of future costs, some of which may be covered by insurance. It is also not possible to provide any meaningful estimate of the future costs of ongoing claims being brought against the Congregation for which there is no reliable estimate of the value or probability of a claim being paid, some of which may be covered by insurance.

Redress schemes are being established, in March 2020 for Northern Ireland, and currently being setup in Scotland. England and Wales have not yet announced their intentions. Contributions to the redress schemes, if any, have not yet been agreed. It is not possible at the present time to provide any meaningful estimate of future contributions.

20. Capital Commitments

At 31 March 2021 the Charity had capital commitments of £nil (2020 - £nil)

21. Related Parties and Connected entities

The Charity is connected to The Congregation of the Sisters of Nazareth (the Congregation), an unincorporated international religious congregation, founded by Victoire Larmenier and recognised by the Vatican, currently comprising 216 Sisters worldwide. The Superior General of the Congregation appoints the Trustees of the Charity.

The Charity is connected also to two other registered charities, details of which are given below:

Name Registration numbers etc Principal activities
The Congregation of the
Sisters of Nazareth
Generalate (CSNG)		 A registered charity (Charity
Registration No 1138876 (England
and Wales))
The support of the Congregation and its
work throughout the world.
Nazareth Care Charitable
Trust		 A registered charity (Charity
Registration No 1113666) and a
company limited by guarantee
(Company Registration No
5518564 (England and Wales),
and SC042374 (Scotland)).		 The provision of nursing, residential and
care services to older people in need
through the operation of 13 homes
within England, Wales and Scotland.
The provision of estate management and
support services to older people at the
retirement villages in Blackburn and
Plymouth.

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Nazareth Care Ireland A registered charity (Charity
Registration No 20154622
(Ireland)) and a company limited
by guarantee (Company
Registration No 592523 (Ireland)).
The provision of residential and care
services to older people in need through
the operation of homes within Ireland.

In the case of CSNG the Superior General of the Congregation also appoints the trustees. In respect to Nazareth Care Charitable Trust, the Superior General of the Congregation is the sole member of the charitable company. The Charity and Nazareth Care Charitable Trust have three Trustees in common. None of the Trustees of the Charity are Trustees of CSNG.

At no point during the accounting period did any of the three charities control one or more of the others. As a consequence, consolidated accounts are not prepared.

21. Connected entities (continued)

Nazareth Care Charitable Trust has a number of subsidiary companies with which it forms the Nazareth Care Charitable Trust Group. Details of the subsidiaries are as follows:

Name Registration numbers etc Principal activities
NRV Development (Blackburn)
Limited		 Company Registration No
05906057(England and Wales)		 The development of a retirement
village in Blackburn.
NRV Development (Plymouth)
Limited		 Company Registration No
05940933(England and Wales)		 The development of a retirement
village in Plymouth.
NRV (Blackburn) Limited Company Registration No
06297407 (England and Wales)		 The provision of management
services at the retirement village in
Blackburn.
Nazareth Catering Limited Company Registration No
06740428 (England and Wales)		 A company providing catering
services to the retirement villages.
NRV Management (Plymouth)
Limited		 Company Registration No
08461398 (England and Wales)		 The provision of management
services at the retirement village in
Plymouth.
Name Registration numbers etc Principal activities
Nazareth Home Care Limited Company Registration No
08461286 (England and Wales)		 The provision of domiciliary care
services until February 2018.
The provision of care services for
other religious organisations from
February2018.
Larmenier Care Home
Management Limited		 Company Registration No
09382120 ( England and Wales)		 The provision of care services for
other religious organisations.
This company was dissolved on 30
October 2018.
NRV Management Glasgow Limited Company Registration No
09382077 (England and Wales)		 The provision of management
services to the retirement
apartments at Nazareth House
Glasgow.

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NRV Development Glasgow Limited Company Registration No
09382096 (England and Wales)		 The development of retirement
apartments at Nazareth House
Glasgow.

Consolidated accounts of the Nazareth Care Charitable Trust Group are prepared and filed with the Charity Commission for England and Wales, the Office of the Scottish Charities Regulator and Companies House.

During the year there have been a number of transactions between the Charity and its connected entities, details of which are given in the paragraphs below.

The Congregation of the Sisters of Nazareth Generalate (CSNG)

At 31 March 2021 the Charity was owed £240,106 (2020 – £240,106) from CSNG being grants authorised but not paid across as at that date (see note 12). At 31 March 2021 the Charity owed CSNG £5,926,785 (2020 – £3,259,575) (see notes 13 and 14) being a loan of

£4,399,919 for the redevelopment of Nazareth House Glasgow and a loan of £1,526,866 (2020 – £524,869) for the redevelopment of Nazareth House Birkenhead.

During the year to 31 March 2021, the Charity paid £65,145 (2020 – £60,414) as a contribution to the Congregation of the Sisters of Nazareth Generalate. CSNCT also gave gifts to CSNG worth £7,700 (2020 – £7,700). CSNCT donated £nil (2020 – £70,000)

Nazareth Care Charitable Trust (NCCT)

At 31 March 2021, the Charity owed £683,345 (2020 - £693,642) to NCCT being £75,000 (2020 - £75,000) in respect of a donation due and £608,345 (2020 - £608,345) (see note 13) in respect to building and refurbishment works at Nazareth House Cheltenham and £nil (2020 – £10,297) for work carried out paid for by NCCT. In addition, the Group was owed £240,106 (2020 - £350,764) being £240,106 (2020 – 240,106)in respect of the contribution for the convent owed to NRV Development (Plymouth) Limited, £nil (2020 – 31,802) in respect of rent owed to NRV Development Blackburn and £nil (2020 – £78,856) in respect of service charge voids due to NRV Management Glasgow and NRV Management Blackburn.

In addition, at 31 March 2021 the Charity was owed £139,872 by NCCT (2020 - £261,652) being £1,212 (2020 – £31,377) in respect to property rental charges and £138,660 (2020 - £162,660) being loan repayments in respect to loans for the building and refurbishment works at Lancaster Day Nursery, £24,000 (2020 - £30,000) of which was payable within one year. During the year the Charity donated £93,745 (2020 - £75,000) to NCCT.

During the year to 31 March 2021, the Charity received management stipend income of £458,590(2020 – £422,930) and rental income of £1,245,411 (2020 – £1,183,965) from Nazareth Care Charitable Trust, of which £1,212 was outstanding at 31 March 2021 (2020 - £31,377). Additionally, the Charity made payments to Nazareth Care Charitable Trust totalling £49,961 (2020 - £59,963) in relation to care home fees at the Cardiff, Cheltenham, Crosby, Glasgow, Hammersmith and Manchester communities.

NRV (Blackburn) Limited

During the year NRV (Blackburn) Limited collected rent from the residents of the Blackburn Retirement Village on behalf of the Charity. At 31 March 2021, a balance of £52,461 (2020 - £122,463) (see note 12) was owed to CSNCT by NRV (Blackburn) Limited.

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Retirement villages

Under the terms on which NRV Development (Blackburn) Limited sells apartments within the retirement village, should the purchaser for any reason wish to vacate the property at any time and not sell it on the open market, NRV Development (Blackburn) Limited undertakes to buy back the unit. This option was removed for sales completed after September 2013. It was calculated that the maximum liability to NRV Development (Blackburn) Limited in the event that several leaseholders simultaneously exercise the buy back option would be £750,000. Should NRV Development (Blackburn) Limited not have sufficient funds to meet this liability, the Charitable Trust has agreed to meet any shortfall. At 31 March 2017 the fund stood at £30,815. During the year ended 31 March 2018 three apartments costing £332,915 were bought back and the fund has been fully utilised (see note 17).

NRV Development (Plymouth) Limited

At 31 March 2021, the Charity owed £240,106 (2020 - £240,106) to NRV Development (Plymouth) Limited for six apartments purchased from NRV Development (Plymouth) Limited. The six apartments are used as a convent by CSNCT.

NRV Management (Glasgow) Limited

At 31 March 2021, the Charity was owed £10,614 (2020 - £nil) by NRV Management (Glasgow) Limited in respect of a service charge refund for void fees paid.

Other related party transactions

There were no other related party transactions other than those disclosed above (2020 – none).

22. Post Balance Sheet Events

There are no post balance sheet events.

23. Discontinued Operations

From April 2021 the charity discontinued its operations in Belfast. The income and expenditure associated with Belfast are therefore disclosed as discontinued operations in the Statement of Financial Activities.

24. Ultimate Control

The Congregation of the Sisters of Nazareth Charitable Trust, which is constituted as a trust, is controlled by the Congregation of the Sisters of Nazareth by virtue of the fact that the Superior General of the Congregation appoints the Trustees.

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