OpenCharities

This text was generated using OCR and may contain errors. Check the original PDF to see the document submitted to the regulator.

2022-12-31-accounts

HERTFORD BRITISH HOSPITAL CORPORATION, Paris

ANNUAL REPORT OF THE DIRECTORS

FOR THE YEAR ENDED

31[st] DECEMBER 2022

1

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

1 REFERENCE AND ADMINISTRATIVE DETAILS

Name Hertford British Hospital Corporation, Paris (hereafter, indifferently, “HBHC”, “the Corporation” or “the Charity”)

Charity number 248 198

Company number 00 878 934 Principal office 3 rue Barbès, 92300 Levallois Perret, France

Registered office UK 8th Floor, 20 Farringdon St, London EC4A 4AB, United Kingdom

1.1 AUDITORS

The Corporation’s auditors are:

1.2 BANKERS AND FUND MANAGERS

The Corporation’s bankers in 2022 were:

The accounts marked * were closed in 2022 and, at the date of this report, the Corporation no longer has any activity with these banks.

1.3 SOLICITORS AND OTHER LEGAL ADVISERS

The Corporation’s legal advisers throughout 2022 and to date are:

1.4 INDEPENDENT PROPERTY VALUERS

The Corporation’s independent property valuers throughout 2022 and to date are:

2

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

2 DIRECTORS, TRUSTEES AND COUNCIL OF MANAGEMENT

The Directors of the Corporation, the Trustees of the Charity and the members of the Council of Management serving during the year and since the year end (collectively hereafter “the Directors” or, indifferently, “the Trustees") were as follows:

Christopher Wicker, Chair (renewed for one year expiring at the June 2023 Council of Management meeting) Dr Julia Bache

David Blanchard (renewed for one year expiring at the June 2023 Council of Management meeting)

Susan Cheyne, Deputy Chair

Stephen Cowen

Thierry Drilhon representing the FBCCI (ex-officio Trustee)

Sandra Esquiva-Hesse

Michel de Fabiani, OBE, Representative Member

Christopher Gilmore (renewed for one year expiring at the June 2023 Council of Management meeting)

Ian Gosling (renewed for one year expiring at the June 2023 Council of Management meeting)

Paul Johnson-Ferguson, Honorary Treasurer

Theo Rycroft, representing the British Embassy (ex-officio Trustee)

Ian McDonald

Richard Seguin

Alicia Suminski (renewed for one year expiring at the June 2023 Council of Management meeting)

Bridget Terrell, Honorary Secretary

Peter Terrell (renewed for one year expiring at the June 2023 Council of Management meeting) Charles Wilson, OBE, Representative Member

2.1 COMMITTEES AND WORKING GROUPS

The Directors are allocated to the various working groups and committees as shown below. The Chair and Vice-Chair are considered ex-officio members of all the Committees and the Director General (see 3.4 below) is a guest at all meetings.

2.1.1 PROPERTY OPERATIONS AND STRATEGY COMMITTEE

Stephen Cowen, Chair

Peter Terrell, Vice-Chair

Christopher Gilmore

Paul Johnson-Ferguson

Richard Seguin

Sandra Esquiva-Hesse (ex-officio as a legal subject matter expert)

2.1.2 FINANCE, RISK, AUDIT & GOVERNANCE COMMITTEE

Paul Johnson-Ferguson, Chair

David Blanchard

Stephen Cowen

Ian Gosling (ex-officio as a legal subject matter expert)

Ian McDonald

The terms of reference of this committee were revised in 2022 to include governance, a subject previously covered by the Governance & Nominations Committee.

3

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

2.1.3 NOMINATIONS COMMITTEE

Susan Cheyne, Chair Dr Julia Bache

David Blanchard

Peter Terrell

The terms of reference of this committee were revised in 2022 to exclude governance, a subject now covered by the Finance, Risk, Audit & Governance Committee. However, the assessment of the performance of individual Trustees remains with the Chair of the Corporation and the Nominations Committee.

2.1.4 STRATEGY COMMITTEE

This committee was merged into the Property Operations and Strategy Committee at the Council of Management meeting held on 22[nd] June 2022.

2.1.5 CHARITABLE GIVING COMMITTEE

Ian McDonald, Chair

Dr Julia Bache

Alicia Suminski

Bridget Terrell

2.1.6 INVESTMENT COMMITTEE (constituted in April 2022)

Paul Johnson-Ferguson, Chair

Alicia Suminski

Edward Archer (external SME)

Simon Pennington (external SME)

3 GOVERNING DOCUMENTS AND OVERVIEW OF THE HISTORY OF THE CHARITY

The Hertford British Hospital (HBH) was founded in 1871 by the late Sir Richard Wallace (referred to as “the Original Charity”). The Corporation is a registered charity, incorporated in the United Kingdom in 1966 and registered in France in 1970 as a non-profit organisation which manages the assets of the Original Charity and those assets received subsequently as gifts and donations. The Original Charity’s hospital activity was transferred to the French charity l’Oeuvre du Perpetuel Secours (hereafter “OPS”) with effect from 1[st] January 2008 and combined with the latter’s own hospital activity to form a joint hospital under the name Institut Hospitalier Franco-Britannique (hereafter “IHFB”).

With effect on 1st March 2019, the activity of IHFB was transferred to a joint venture in the form of a Groupement de Coopération Sanitaire (the “Groupement”) created by the Fondation Cognacq-Jay (the “Fondation”) and OPS after receiving the approval of the French Health Authorities. HBHC sought and obtained the approval of the Charity Commission to the transaction.

In 2019, the Fondation increased its percentage ownership in the capital of the Groupement to 99.67 % and reduced OPS’ share to 0.33 %. HBHC’s obligation to contribute to the funding of the continuing deficits of the IHFB came to an end on 31[st] December 2019.

In September 2020, the Fondation injected fresh funds into the Groupement and, as part of its restructuring, the OPS withdrew from participation in the hospital, whose activities are henceforth managed solely by the Fondation. A new agreement was entered into between the Corporation and the Fondation making the hospital building available rent free until September 2025, with a potential extension until 2026. However, given that the Fondation’s building project on the rue Kleber site is running late, and that it is now anticipated that the maternity, geriatric and other activities housed in the Corporation’s building will not move to rue Kleber until 2027 at best and potentially 2028, the agreement with the Fondation was extended on 13[th] December 2022 and now runs until 2028.

4

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

As part of the reorganisation of the hospital activity, on 1[st] January 2021, the Corporation sold its remaining medical activity (the “Centre International de Dermatologie” or “CID”) to the Fondation for a symbolic sum and entered into an agreement similar to that signed for the hospital building so that the CID could continue to use its existing premises at 12 rue Barbès rent free (as is explained further below, these premises were sold in February 2022 but, as required by law, the obligations of the Corporation were fully assumed by the purchaser and the CID continues to be housed under the same terms). All the employees attached to the CID were transferred to the Fondation.

4 OBJECTIVES

The objects for which the Original Charity was established were to operate a hospital in or near Paris for the treatment and relief of persons suffering from illness, injury, disease or other infirmity or otherwise requiring medical attention, being primarily British residents, as well as serving the local population.

The present-day objectives of the Corporation are, in all essential respects, identical to those initially laid down by the founder. These objectives, as expressed in its Memorandum of Association, are dedicated to the medical treatment of patients of British nationality resident in France or of any other nationality, but with a preference for the former. These objectives have been extended to the provision of other health services and retirement homes.

In 2006, the objects of the Original Charity were expanded (with the Charity Commission’s consent) to include the protection of health by such means as the trustees consider appropriate.

5 STRUCTURE, GOVERNANCE AND MANAGEMENT

5.1 PATRONAGE

The ninth Marquess of Hertford, a member of the family of the Charity’s founder, has been HBHC’s Patron since 2006.

5.2 APPOINTMENT OF TRUSTEES

The Council of Management (hereafter “the Council”) is composed of not less than thirteen and not more than twenty-four Trustees, comprising two ex-officio members, two representative members and not more than twenty co-opted members. There are at present two ex-officio members, two representative and sixteen co-opted members.

The ex-officio members are:

The representative members are appointed at the Annual General Meeting and retire from office at the close of the next Annual General Meeting following that of their appointment.

Co-opted members are appointed for a term not exceeding five years and are eligible for re-election. Trustees are chosen with regard to their availability to spend time on the charity and their specialist skills and experience in management, finance, law, property, healthcare…

As part of the strategic planning for the future, and under the responsibility of the Nominations Committee, the Corporation intends to ensure that significant attention is given in 2023 and subsequent years to creating a pool of potential “next generation” trustees whilst also ensuring that the wisdom and knowledge of long-standing trustees is retained. It is intended that this will be achieved in part through the creating of a “Supporters’ College” and a “Trustee Emeritus” role.

5

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

5.3 TRUSTEE INDUCTION AND TRAINING

New trustees are briefed on their legal obligations under charity and company law, the content of the Memorandum and Articles of Association, the work of the committees, the decision-making processes, the objectives and the recent financial performance of the charity.

In addition, under the stewardship of the Finance, Risk Audit and Governance Committee, there is an annual conflict of interest confirmation process which, together the declarations made at the start of each Council meeting, ensures that the Trustees comply with the Conflict of Interest Policy (which is maintained by the committee and approved by Council).

5.4 ORGANISATION

The Council administers the charity and meets quarterly. At the Council meeting held immediately after the Annual General Meeting, the Trustees elect a Chair, a Deputy Chair, an Honorary Treasurer and a Secretary. The Trustees also elect the Chairs and members of the various committees listed above and, as appropriate, approve their terms of reference.

These committees make recommendations to Council on the long-term strategy, oversee the finances of the Charity (including its reserves and investment policies), the charitable activities (including the grant giving policy), the succession planning for Trustees and the operations of its commercial property portfolio. They meet as often as required.

In the light of the significant changes in the activities of the Corporation as explained above, the operating policies were last updated and approved as follows:

No changes to policies were made in 2022 but it is expected that the investment policy will be reviewed in 2023 in the light of the experience gained over 2022 and early 2023.

The terms of reference of the Finance, Audit, Risk and Governance Committee were revised and approved in December 2022 to take account of the addition of Governance to their responsibilities, and the Nominations Committee terms of reference were updated at the same time to remove that element. The Property Strategy and Operations Committee will also update its terms of reference to take account of its wider remit.

Since 1[st] January 2021, a Director General manages the Corporation’s affairs on a day-to-day basis, represents the Corporation vis à vis third parties and assists the Directors in preparing the Corporation for the changes required once the hospital building ceases to be used by the Foundation in 2028. The Director General, Iain Hutton, took office in January 2021, and has served since then. The Director General is the sole employee of the Corporation, and he reports on a weekly basis to the Chair, Vice-Chair and Treasurer who assess his performance annually and set his remuneration.

5.5 THE BRITISH CHARITABLE FUND AND OTHER RELATED PARTIES

The Charity has a long-standing relationship with the British Charitable Fund, Paris (“BCF”). The BCF, a UK registered charity with a related French entity, provides help to British residents in France who have fallen on hard times. The founder of the Original Charity, Sir Richard Wallace, was a most generous benefactor of the BCF in the past and, until early 2022 when the property was sold (with an obligation for the purchaser to maintain the BCF in its premises), the Corporation provided rent-free accommodation to the BCF at 12 rue Barbès. The Corporation also makes a financial contribution each year to the BCF.

In order to facilitate the relationship between the two charities, each has appointed a trustee who is a guest at the meetings of the governance body of the other: Ian McDonald represents the Corporation at meetings of the BCF’s governing body and Jonathan Goatly represents the BCF at HBHC Council of Management meetings.

6

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

As is further explained in paragraph 6.2 below, the BCF and the Corporation are engaged in a process aimed at ensuring that the two charities can work ever more closely together going forward.

Apart from the BCF, there are no other related parties with whom the Corporation entered into any material transactions in 2022 or 2021.

6 ACHIEVEMENTS AND PERFORMANCE

6.1 CHARITABLE ACTIVITIES

The Objectives of the Charities are met:

It is worth noting that, had the hospital been rented to the Fondation Cognacq-Jay at a market rent, as estimated by Savills in a report dated March 2021, that rent would have approximated €1.22 million; the Trustees are not aware of any matter that would require this amount to be reassessed for 2022.

The total amount of Charitable giving, to the BCF and other Charities in 2022 amounted to 129 650 € (£115 031).

The Corporation continues to assist the Foundation Cognacq-Jay with the “British” aspects of the hospital and has agreed to part fund a specific communications role dedicated to the British aspects the hospital’s operations (care for anglophone patients, partnerships with UK healthcare institutions, etc.).

Throughout 2022, the Trustees complied with their duty to have due regard to the guidance on public benefit published by the Charity Commission in exercising their powers and duties.

6.2 STRATEGIC PLAN

Trustees are working on a strategic plan, for submission to the Charity Commission in 2023, that will, once approved, see the Corporation focus on the wellbeing of beneficiaries in France with ties to Britain through various means, including, in due course, first a significantly closer collaboration with the BCF in the UK and France (as documented in a memorandum of understanding signed by both charities) and, secondly, the redevelopment of the hospital site once it is vacated by the Fondation Cognacq-Jay. As reported above, the Fondation Cognacq-Jay have given indications that their redevelopment project is running to a timetable that would require them to remain in the hospital site beyond the initial end date of the agreement and an addendum to that agreement was signed in 2022 to ensure that the provision of care can continue as appropriate.

6.3 INVESTMENT AND BORROWING ACTIVITIES

As reported last year and more fully explained in note 25.2 to the financial statements, the mixed office and residential building at 12 rue Barbès in Levallois-Perret was sold on 18[th] February 2022 for €12.1 million and the proceeds used to reimburse the outstanding amounts due to Dexia Crédit Local. The net proceeds of €10.6 million have been invested under the management of Rothschild Martin Maurel who are supervised by the Investment Committee. The investments are made in accordance with the Corporation’s investment policy and comprise two equal funds, one invested in “Fonds Euro” lower risk bonds and money market funds and the other being invested over time to create an managed equity and bond portfolio with a view to securing medium term capital growth whilst respecting the Corporation’s risk profile, as defined by the Investment Committee, and approved by the Council.

7

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

In 2023, these investment funds will be used as security for a Lombard loan that will be used to finance the renovation of the Château. At 31[st] December 2022, as further explained in note 17 to the Financial Statements, these funds have been marked to market with a small loss in value which was recovered in 2023 as markets performed well in the first quarter of 2023.

Following the COVID crisis, a government backed loan of £898 101 (€999,000) was taken out in August 2020. The repayment schedule for the loan was agreed with the bank in 2021, and it is being repaid over the full permitted term of 6 years from August 2020. The balance owing at 31[st] December 2022 amounted to £652 206 (€735 377).

6.4 CHATEAU PROJECT & CHARITY PROPERTIES

As reported last year, a multi-year property redevelopment plan was prepared in 2022, with advice from an external property consultant and an architect selected after an initial tender process supervised by the Property Operations and Strategy Committee. This plan was presented to the Council of Management at its June 2022 meeting and covered all the remaining properties under the Coporation’s management: the hospital which is made available to the Fondation Cognacq-Jay until 2028, the Wallace Gardens building which is let to Batigère (a leading social housing company) and the Château. The plan proposes that the properties be redeveloped as they become available over time, starting with the Château which is not only the first to become available but also one that requires significant renovation in order to remain lettable and meet environmental and other requirements such as disabled access.

The work on renovating the Château is expected to commence in mid to late 2023 and take approximately one year. The necessary design work has been completed and a building permit requested. At the date of this report, discussions are in progress with a potential tenant.

7 FINANCIAL REVIEW

7.1 2022 FINANCIAL STATEMENTS

The cash position of the Charity at 31 December 2022 was £2 023 235 (€2 281 243 ), and Loans outstanding represent £679 147 (€765 754)

The Covid-19 sanitary crisis continued into early 2022. Whilst the disposal of the dermatology activity in 2021 (see above) meant that the operational impact on the Charity was minimal, the crisis did have a financial impact on the Charity through the decrease in rental income during the period of confinement and subsequent constraints over certain types of activity (eg restrictions on number of people allowed). This is more fully explained in note 3.1 to the Financial Statements.

In 2022, the let property income amounted to £ 2 559 484 (€2 885 876) and was impacted by the resolution of the dispute described in §7.2 with the tenant of the Chateau, a settlement which required further concessions in terms of adjustments to the rent (including a further rent-free period) but which allowed the recovery of a large part of the backlog and secured rental income until the end of the year. At 31[st] December 2022, the amount due by Zalthabar, amounted to £56 942 (€64 203).

In 2022, the Charity made an operating profit of £1 567 170 (€1 767 020) before deducting tax and before taking into account the loss on revaluation of its investment properties and the gain of €7 464 834 / £6 620 561 on disposal of 12 rue Barbès. There is a profit of €11 463 280 / £ 10 166 783 (in 2021, a loss of €45,398 / £ 38 147) in the French accounts due to a difference in the treatment of depreciation and to the gain on sale of 12 rue Barbès.

8

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

A professional valuation of the Château property at 31[st] December 2022 resulted in a decrease in the estimated market value of £1 535 593 (€1 731 49) bringing the total value of the property portfolio to £39.1 million (€44.1 million). This loss in value results in part from the trend in market rates but is also the direct consequence of the redevelopment budget which represents significantly higher investment than that anticipated by the valuers in earlier valuations. The valuation at 31[st] December 2022 takes into account the full costs of the renovation, expected at approximately £8.0 million (€9 million) and the independent valuers’ report states that, all things being equal, the valuation post redevelopment is estimated at approximately £16.9 million (€19.1 million). Savills, the independent valuers, have also issued a comfort letter which supports the Trustees’ decision not to revalue Wallace Gardens at 31[st] December 2022 and to continue to adhere to the policy which requires revaluation of investment properties on a 2 year cycle (previously 3 years, now reduced to 2 since the third asset has been sold).

As is further explained in note 16.3 to the Financial Statements, the land on which are situated the current hospital and the Villiers investment properties is vested in the Secretary of State for the Environment and managed and administered by the Council of Management of the Corporation who are also Trustees of the Original Charity (Hertford British Hospital).

7.2 PRINCIPAL RISKS AND UNCERTAINTIES FACING THE CHARITY

The Trustees make every effort to identify and address all major risks to which the Corporation is exposed.

Members of the Property Operations and Strategy Committee ensure that the Charity’s portfolio of commercial buildings is properly maintained and that its properties are rented out to suitable tenants at market levels of rent.

The tenants of the Château building (which is the original 1898 hospital building and is a listed historical monument, now used as offices / meeting rooms) were in dispute with the Charity over the payment of business tax for several years and, over the years, held back rent and charges in excess of the business tax in dispute. In 2020 and throughout most of 2021 (with the exception of the fourth quarter of 2021), the tenant made no payments at all and the amount owing at 31[st] December 2021 amounted to a €1.5 million (see note 3.4 to the financial statements). The Corporation pursued legal action on both the business tax issue and the non-payment of rent throughout 2021 and into 2022 when proceedings were filed before the Commercial Court requesting that the tenant be placed into receivership. After discussion, the parties reached an agreement that was signed on 8[th] March 2022. The impact of this settlement is more fully explained in note 4.2 to the Financial Statements but its essential non-financial impact was initially to secure the return of the asset on 30[th] September 2022. However, given that the tenants had met their obligations under the agreement, and because their new premises were not yet ready for use, the Corporation entered into an addendum to the agreement, allowing the tenants to remain on site until 30[th] December 2022. As 2022 came to an end, the tenants indicated that their new premises were still not ready and a further addendum was entered into, allowing the occupation of the building until 31[st] March 2023. This addendum was not signed. At the date of this report the Charity has received no rent in 2023, and has requested a judgement from the interim relief judge to allow the removal of the company which continues to occupy the premises despite the termination of its tenancy.

Members of the Finance, Risk, Audit & Governance Committee ensure that all financial risks are identified and that expenses are strictly limited. The Committee oversees all systems, controls and processes that may have an impact on the Charity’s ability to meet its objectives and ensures that effective audit functions and adequate risk management processes are in place.

In 2022, the Corporation has no significant financial investment income, endowments, grants or donations but it did sell one of its investment assets, the building at 12 rue Barbès (see para 7.1). Stock market upturns and downturns have historically had no direct influence on the Charity’s results and this remains true for 2022. However, given the sale of the 12 rue Barbès property in early 2022, and the investment of the proceeds, as described above, the Charity created an investment policy and the related Investment Committee that was convened in April 2022 and comprises two Trustees and two recognized subject matter experts. The Investment Committee’s remit is to supervise the application of the investment policy, monitor the performance of the fund manager / custodian, and generally to manage the Corporation’s investments.

9

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

7.3 PLAN FOR FUTURE PERIODS

The Finance, Risk, Audit & Governance Committee will continue to keep operating costs to a minimum. Legal costs, which were significant in both 2021 and 2022 as work was done on structure, objects, etc. are expected to start to fall slightly in 2023. Interest payments to banks which reduced in 2022 (when only the government backed loan and the loan from Société Générale remained outstanding) will start to rise in 2023 as the Corporation draws down on the Lombard loan to finance the renovation of the Château. This loan bears interest at EONIA 1 month plus 0.7%.

The forecast approved by the Council of Management in the context of the Château renovation plan shows that the maximum draw down is expected to reach £5.8 Million (€6.5 Million) in 2024, reducing to £2.1 Million (€2.4 Million) in 2027 when the current lease on Wallace Gardens expires.

Discussions continue with the Charity’s advisors in the UK and France as to the reorganization of the way in which the Original Charity’s assets are held and managed and it is expected that 2023 will see not only a revision of the Corporation’s objects clause and articles but also a simplification of the legal structure in the UK and, as already explained above, ever closer ties with the BCF.

8 TRUSTEES’ RESPONSIBILITIES IN RELATION TO THE FINANCIAL STATEMENTS

English company law requires the Trustees to prepare financial statements that give a true and fair view of the state of affairs of the charity at the end of the financial year and of its surplus or deficit for the financial year. In doing so the trustees are required to:

The Trustees are responsible for maintaining proper accounting records, which disclose with reasonable accuracy at all times the financial position of the charity and enables them to ensure that the financial statements comply with the Companies Act 2006 and the Statement of Recommended Practice–Charities (FRS 102). The Trustees are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The present document and attached financial statements have been prepared in compliance with the Companies Act of 2006 and the Statement of Recommended Practice - Charities (FRS 102).

In accordance with English company law, as the Corporation’s directors, we certify that:

9 DATA PROTECTION

The Charity is compliant with the General Data Protection Regulation (GDPR) which came into force in May 2018. This law was of particular relevance to the operations of the Dermatology Centre (CID) and, whilst the Corporation continues to have a Data Protection Officer (outsourced) to manage its compliance, the volume of personally identifiable data is now considerably reduced.

10

HBHC_Directors report_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Annual report of the Directors Year ended 31[st] December 2022

10 AUDITORS

The reappointment of Grant Thornton for a six-year period commencing with the examination of the 2022 financial statements was proposed to the Annual General Meeting held on 22[nd] June 2022 and was approved.

By order of the Directors

Christopher Wicker, Chairman 19[th] April 2023

11

HBHC_Directors report_31 Dec 22_Council Approval.docx

Statutory auditor’s Report on the financial statements

Year ended 31 December 2022

Grant Thornton

Hertford British Hospital Corporation, Paris

3, rue Barbès 92300 Levallois Perret

SAS d'Expertise Comptable et de Commissariat aux Comptes au capital de 2 297 184 € inscrite au tableau de l'Ordre de la région Paris Ile France et membre de la Compagnie régionale de Versailles RCS Nanterre B 632 013 843 27 rue James Watt 37200 Tours

Grant Thornton

Hertford British Hospital Corporation, Paris Year ended 31 December 2022

13

Statutory auditor’s Report on the financial statements

Hertford British Hospital Corporation, Paris Year ended 31 December 2022

To the Trustees,

In our capacity as French statutory auditor and in accordance with your request for the purpose of the Charity Commission Requirements, we hereby report to you on the audit of the accompanying financial statements of Hertford British Hospital Corporation, Paris for the year ended 31 December 2022 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flow and the related notes 1 to 25.2. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”.

Respective responsibilities of Trustees and auditor

As explained more fully in the Trustees’ Responsibilities Statement set out on page 10, the Trustees (who are also the directors of the Charitable Company for the purposes of company law) 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 the 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 ability to continue as a going concern, disclosing, as applicable, masters related to going concern and using the going concern basis of accounting unless the Trustees

Grant Thornton

Hertford British Hospital Corporation, Paris Year ended 31 December 2022

14

either intend de liquidate the entity or to cease operations, or have no realistic alternative but to do so.

Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and French Standards on Auditing. Those standards require that we comply with local ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs 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.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the charitable company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the trustees; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the annual report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinion the financial statements:

Grant Thornton

Hertford British Hospital Corporation, Paris Year ended 31 December 2022

15

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, the information given in the Trustees’ Annual Report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members 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 company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

This report is governed by French law. The courts of France shall have exclusive jurisdiction over any claim, dispute or difference resulting from the engagement letter or the present report or any related matters. Each party irrevocably waives its right to oppose any action brought before the French courts, to claim that the action is being brought before an illegitimate court or that the courts have no jurisdiction.

Tours, 30[th] May 2023

The Statutory auditor

Grant Thornton

French Member of Grant Thornton International

----- Start of picture text -----
Adam Nicol
Partner
----- End of picture text -----

HERTFORD BRITISH HOSPITAL CORPORATION, Paris

FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 DECEMBER 2022

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Financial statements Year ended 31[st] December 2022

Statement of Financial activities

(including income and expenditure account) For the year ended 31[St] December 2022

Income and endowments
Income from trading activities:
Income from property investments
Income from charitable activities:
Health service income
Total income and endowments
Expenditure on raising funds
Cost of generating funds
Total expenditure on raising funds
Expenditure on charitable activities:
Health services expenditures
Governance costs
Total expenditure
Net income before non-operating
items
Provision for retirement indemnities
Net income before unrealised gains on
investment properties
Gains / (losses) on revaluation of
investment properties
Net movement in funds before
taxation
Taxation
Net movement in funds after taxation
Funds brought forward at 1stJanuary
Exchange difference
Funds carried forward at
31st December		 Unrestricted funds
2022
2021
2022
2021
€
€
£
(0,8869)
£
(0,8403)
5
2 885 876
2 647 843
2 559 483
2 224 982
6
63 566
53 415
2 885 876
2 711 409
2 559 483
2 278 397
315 148
1 589 560
279 505
1 335 707
7
315 148
1 589 560
279 505
1 335 707
8 & 9
107 609
(44 384)
95 438
(37 296)
12
696 099
540 117
617 370
453 860
1 118 856
2 085 293
992 313
1 752 271
1 767 020
626 116
1 567 170
526 126
1 767 020
626 116
1 567 170
526 126
16
(1 949 552)
3 252 263
(1 729 058)
2 732 877
(182 532)
3 878 379
(161 888)
3 259 003
13
(182 532)
3 878 379
(161 888)
3 259 003
23
58 689 784
54 811 405
49 317 025
49 275 453
..
..
2 734 945
(3 217 431)
23
58 507 252
58 689 784
51 890 082
49 317 025

The footnotes form an integral part of the financial reporting.

17

HBHC_UK accounts_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Financial statements Year ended 31[st] December 2022

Fixed assets
Intangible fixed assets_:_
Tangible fixed assets
Investment properties
Financial assets
Current assets
Debtors
Short term investments
Cash at bank and in hand
Sinking fund
Current liabilities
Creditors
Loans (excluding accrued interest)
Taxation
Net current (liabilities) / assets
Total assets less current liabilities
Long-term liabilities
Loans
Provisions
Investment grant
Creditors
Total net assets
Unrestricted funds
Revaluation reserve
Special and other reserves
Total unrestricted funds		 Balance sheet
As at 31StDecember 2022
2022
2021
2022
2021
€
€
£
£
14
..
..
..
..
15
2 114 048
2 418 873
1 874 950
2 032 578
16
44 068 581
57 900 001
39 084 424
48 653 371
10 565 593
230
9 370 624
193
56 748 222
60 319 104
50 329 998
50 686 142
17
2 223 912
2 738 284
1 972 388
2 300 981
..
29 359
..
24 670
2 251 286
1 828 391
1 996 666
1 536 397
18
29 957
100 042
26 569
84 065
4 505 155
4 696 076
3 995 623
3 946 113
19
1 490 991
1 793 791
1 322 361
1 507 320
20
229 413
3 217 921
203 466
2 704 019
13
..
..
..
..
1 720 404
5 011 712
1 525 827
4 211 339
2 784 751
(315 636)
2 469 796
(265 226)


59 532 973
60 003 468
52 799 794
50 420 916
20
536 341
765 754
475 681
643 463
21
..
..
..
..
22
489 380
547 930
434 031
460 426
19
..
..
..
..
1 025 721
1 313 684
909 712
1 103 889
58 507 252
58 689 784
51 890 082
49 317 027
23
23 758 679
33 173 066
21 071 572
27 875 327
23
34 748 573
25 516 718
30 818 510
21 441 698
58 507 252
58 689 784
51 890 082
49 317 025

Signed on 19th April 2023

Christopher Wicker

Iain Hutton

Chairman Director General

The footnotes form an integral part of the financial reporting.

18

HBHC_UK accounts_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Financial statements Year ended 31[st] December 2022

Statement of cash flow

For the year ended 31[St] December 2022

Cash flow from operating activities
Net incoming resources for year
Depreciation
Decrease / (increase) in debtors
Increase / (decrease) in creditors
Increase / (decrease) in provisions
Increase / (decrease) in investment
grant
Cash generated by operating activities
Taxation paid
Investing activities
Net acquisition of fixed assets
Net acquisition of financial asset
Renovation of investment properties
Proceeds from disposal of fixed assets
Cash applied to investing activities
Net cash (outflow) / inflow before
financing
Financing activities
New long-term loans
Repayment of long-term loans
Cash applied to financing activities
Net cash applied
Net opening cash
Net closing cash
Net closing cash
Cash at bank and in hand
Sinking fund
Short term investments
Current liabilities – short term bank
loans
Net closing cash		 2022
2021
2022
2021
€
€
£
£
1 767 020
626 116
1 567 170
526 126
(664 601)
124 040
(589 435)
104 231
1 322 841
(353 290)
1 173 229
(296 869)
(302 799)
41 709
(268 552)
35 048
21
(133 490)
(112 172)
(58 550)
(58 550)
(51 928)
(49 200)
2 063 911
246 535
1 830 484
207 164
15
195 594
(7 148)
173 472
(6 006)
(10 600 000)
(230)
(9 401 140)
(193)
(218 133)
(247 737)
(193 462)
(208 173)
12 100 000
30 962
10 731 490
26 017
1 477 461
(224 153)
1 310 360
(188 355)
3 541 372
22 382
3 140 844
18 809
..
..
(1 793 013)
(904 775)
(1 590 223)
(760 282)
(1 793 013)
(904 775)
(1 590 223)
(760 282)
1 748 359
(882 393)
1 550 621
(741 473)
532 884
1 415 277
472 615
1 189 257
2 281 243
532 884
2 023 236
447 784
2 251 286
1 828 391
1 996 666
1 536 397
18
29 957
100 042
26 569
84 065
29 359
24 670
(1 424 908)
(1 197 350)
2 281 243
532 884
2 023 235
447 782

The footnotes form an integral part of the financial reporting.

19

HBHC_UK accounts_31 Dec 22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris

Notes to the financial statements for the year ended 31[st] December 2022

1 Legal status, activities and financing

Hertford British Hospital Corporation, Paris (hereafter “the Corporation”), was incorporated in the United Kingdom on 10[th] May 1966 as a company limited by guarantee and not having a share capital. The Corporation was established for purposes which are exclusively charitable, and in this context, provides premises to the Fondation Cognacq-Jay for the operation of the Hôpital Franco-Britannique. It also provides limited financial support to the British Charitable Fund, a related but independent charity.

The Corporation also owns a portfolio of investment properties whose revenue is used to further the objects of the charity.

2 Accounting policies

2.1 Basis of preparation

The financial statements incorporate the investment property management and commercial letting activities of the Corporation. They have been prepared under the historic cost convention, except for investments in property which are included at market value.

The financial statements have been prepared in accordance with the Statement of Recommended Practice–Charities (FRS 102) as per October 2019 and effective at 1[st] January 2019, applicable UK Accounting Standards and the Companies Act 2006. The principal accounting policies adopted in the preparation of the financial statements are set out below.

2.2 Functional and reporting currencies

The functional and reporting currency of the Corporation is the Euro. Financial information is also presented in these financial statements in pounds sterling, using year-end rates of exchange in translating all assets, liabilities, funds, income, expenditure and cash flows as follows:

2.3 Income and endowments

Investment income is recognised on an accruals basis.

Where leases on investment properties provide for a rent-free period and where sums are significant, the rental income is spread over the period of the lease to provide a constant return over that period.

For significant amounts, the rent-free period is spread over the term of the lease by accounting for “Income not yet invoiced” and a corresponding amount receivable. This amount is released progressively over the term of the lease and the amount to the spread is revised annually in accordance with the relevant index.

Health services income is recognised as earned as and when the related medical services are provided. Financing from the French government included in this category is recognised where there is entitlement,

20

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

certainty of receipt and the amount can be measured with sufficient reliability.

2.4 Costs of generating funds

These costs include let property expenses and interest on loans relating to the renovation of the Corporation’s investment properties.

2.5 Charitable activities

These activities include health services expenditure and comprise both the direct costs and support costs related to this activity. Governance costs include those incurred in the governance of the Corporation and its assets and are primarily associated with corporate and statutory requirements

2.6 Irrecoverable VAT

As a charity, the Corporation does not fall under the VAT regime for all its healthcare related activities; VAT is only applicable to the management and real estate activities.

All amounts expended are classified under activity headings that aggregate all costs related to the category. Irrecoverable VAT is charged against the category of resources expended for which it was incurred.

2.7 Intangible fixed assets

Intangible fixed assets comprised establishment costs, computer licences and software and are amortised over a five-year period

2.8 Tangible fixed assets

Tangible fixed assets are stated at cost. Only those assets in use for medical purposes are classified as tangible fixed assets, investment properties being classified separately.

Individual fixed assets are capitalised at cost.

The cost of an asset is its purchase price, including customs duties and non-recoverable taxes, after deduction of rebates, trade rebates and cash discounts of all directly attributable costs incurred to bring the asset into use, in place and in working order for the intended use. Transfer rights, fees or commissions and legal costs related to the acquisition are attached to this acquisition cost.

All costs which are not part of the acquisition price of the asset and which cannot be directly attached to the costs made necessary to put the asset in place and in a state of operation in accordance with its intended use, are recognized as expenditure.

2.9 Valuation of investment properties

The Trustees determine the market value of investment properties on the basis of valuations undertaken by professional surveyors and estate agents on a rotational basis over three years.

2.10 Depreciation

No depreciation is provided on assets under construction. Depreciation of other tangible fixed assets is calculated on the straight-line method at annual rates designed to write off the cost or

21

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

valuation over their estimated useful lives.

Depreciation rates are as follows:

The Directors determine at the year-end, considering both internal and external information available to them, whether there are any indications that would suggest that the value of the assets may have been significantly impaired.

2.11 Investment grants received

Investment grants received to finance the acquisition of fixed assets are recorded on the balance sheet and taken to income based on the depreciation plan of the related equipment. Other grants received are credited to income on receipt.

2.12 Short-term investments

Short-term investments are stated at their market value at the balance sheet date.

2.13 Donations received

Any donations received during the year are recorded in unrestricted funds.

2.14 Current assets

Current assets are valued at their nominal value. A provision for depreciation is recorded when the realizable value is estimated to be lower than the book value.

2.15 Provisions

Any present obligation resulting from a past event with regard to a third party, which can be estimated with sufficient reliability, and covering identified risks, is recognized as a provision.

2.16 Retirement indemnities

Upon retirement, the Corporation’s employees would receive a lump sum retirement indemnity in accordance with the law and the collective agreement applicable to the Corporation. There is no specific agreement and no on-going pension liability for retired employees once this one-off indemnity has been paid.

The sole employee in 2022 has already claimed his pension benefits and, accordingly, when that individual leaves the Corporation, no lump sum will be due.

In prior years and in accordance with FRS 102, a provision for rights acquired by staff was established based on an actuarial calculation, reduced if applicable by the realizable value of the insurance contract taken out to meet the future cost of the retirement indemnities. This provision was reversed in 2021 when the last employee entitled to a lump sum benefit left the Corporation.

22

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

3 Significant events in the current and prior year

3.1 COVID 19 sanitary crisis

In 2021 and 2022, the Corporation did not use the aid mechanisms implemented by the government.

Although the health crisis did not have a direct impact on the Corporation’s activity during the 2021 financial year, the fact remains that it suffered the consequences indirectly due to repeated breaches by its tenant, Zalathabar, of its payment obligation. As a consequence of the measures taken by the government to fight against the spread of the COVID 19 virus, the activity of Zalthabar, tenant of the "Château", was seriously disrupted, and this company has refrained from paying their rent due under the conditions of the lease. The situation with Zalthabar is presented in detail in notes 3.4 and 4.1.

3.2 Disposal of the CID and transfer of staff (prior year)

As of 1[st] January 2021, the Corporation, under an appropriate contract, ceded to the Fondation Cognacq-Jay the trading activity of the CID comprising:

The sale was made at net book value for fixed assets (€30 964 / £35 929) and inventories (€12 410 / £11 157); for an amount of € 1 for the trade name and patient base.

Except for protected employees who were transferred on 19[th] February 2021, all CID staff were transferred to the Fondation Cognacq-Jay on 1[st] January 2021.

3.3 Agreements to end the direct provision of healthcare (prior year) and extension of occupancy agreement.

In September 2020, the Fondation Cognacq-Jay injected fresh funds into the Groupement de Coopération Sanitaire (“Groupement”) the joint venture vehicle which had been set up by it and l’Oeuvre du Pertpetuel Secours (“OPS”) to own and manage the Institut Hospitalier Franco-Britannique hospital. As part of the restructuring, OPS withdrew from participation in the Groupement and from the management of the hospital which was renamed “Hopital Franco-Britannique Fondation Cognacq-Jay”.

As a consequence, the Corporation and OPS agreed on 28th September 2020 to end their own relationship, including the agreement under which the Corporation had agreed to the Maternity Department of the hospital occupying its hospital building until 2031.

In this context, the Corporation has recognized that it does not have a right to recover the hospital activities transferred in 2008 and that in any event, it waives any such right should it exist.

The old occupancy agreement with OPS which allowed the hospital to occupy the building was replaced by a new agreement signed with the Fondation on 9[th] December 2020. As such, the Corporation consents, free of charge, and temporarily, in application of articles 1875 to 1891 of the French Civil Code, to the Fondation Cognacq-Jay, beneficiary-borrower, who accepts it, a rent-free lease relating to the hospital site at 3 rue Barbès, 92300 Levallois-Perret for a period of five full and consecutive years from 28[th] September 2020 at 00 hour, expiring on 28[th] September 2025 at midnight.

The lender accepts that the borrower may, 6 months before the end of the term, request a postponement of the initially planned term to 28[th] March 2026 or 28[th] September 2026. This request must be made no later than 28[th] March 2025.

At the end of the said agreement, the borrower undertakes to return the premises loaned, as well as the equipment present and mentioned in the inventory, in normal and usual condition.

In 2022, because of the delays encountered in the renovation of the Fondation Cognacq-Jay’s nearby hospital buildings, the occupancy agreement was extended under the same terms until 2028.

23

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

All of the agreements between the Corporation, OPS and the Fondation Cognacq-Jay do not call into question the reimbursement by the Hôpital Franco Britannique of the subsidies described in note 23.

3.4 Litigation with Zalthabar

The Zalthabar company, tenant of the Château, disputed its rent and charges due for 2020 and 2021 without making the slightest difference between the periods when it was closed or open.

This resulted in a backlog at 31[st] December 2021 of unpaid rents and charges including VAT amounting to € 1 506 858 (£ 1 266 213) and this despite the reduction in rent granted by Corporation and amounting to € 199,192 including VAT as described in note 4.2. This backlog, net of VAT, was fully provided against at 31[st] December 2021.

In 2022, the parties reached an agreement that was documented in a protocol signed on 8[th] March 2022. In accordance with this protocol, the lease would be terminated early, on 30[th] September 2022 and Zalthabar committed to reimbursing the outstanding debt net of an exceptional discount of € 337 122 inclusive of VAT (£ 283 283) granted by the Corporation. In addition, the Corporation agreed to a 15% reduction in the rent due for the period from 1[st] January 2022 to 30[th] September 2022; this rent being payable monthly.

Throughout the period to 30[th] September 2022, Zalthabar complied with its obligations and paid the amounts due in full. In these circumstances and because Zalthabar’s new premises in La Défense were not ready, the lease term was extended to 30[th] December 2022 under the same terms and amounts due under the addendum to the protocol were all paid in full. However, Zalthabar did not respect this new commitment and did not leave the premises as planned.

Zalthabar is still present in the premises on 31 December 2022. Rent and service charge arrears of €53 502 before VAT (£44 958) at the balance sheet date are fully provisioned.

3.5 Sale of 12 rue Barbès

On 18[th] February 2022, the premises at 12 rue Barbès were sold for a total consideration of €12 100 000 (£10 731 490). This price match the independent valuation of €12 100 000 (£10 731 490) obtained by the Corporation for the purposes of compliance with S119 of the Charities Act 2011 and published in a report issued by Savills in conformity with the Charities (Qualified Surveyors’ Reports) Regulations 1992.

The proceeds were used to fully reimburse the loan which had been provided by Dexia (see note 26.2) and the remainder invested in two funds as is further explained. It is the intention of the Directors that these funds be used to secure funding for the renovation of the Château and, subsequently, for the renovation of other investment assets such as to ensure that the said assets remain in good order and are marketable, thus ensuring continued income for the Corporation which, in turn, will allow it to pursue its charitable purposes.

Pending the proceeds from the sale of the building at 12 rue Barbès to fund the renovation of the building at 48 rue de Villiers (le Château), the cash has been invested for an amount of €10,600,000 on two capitalization contracts (€5,300,000 per contract) with Crédit Agricole bank.

Financial assets are invested as follows:

Fonds interne dédié 53063600021
CALI EUROPE A038344
Support euro 2
Fonds genral cali QS0020012512
TOTAL		 Investment
Market Value
31stDecember 2022
Difference
5 300 000
5 265 363
34 637
5 300 000
5 300 000
..

10 600 000
10 565 363
34 637

24

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

As 31[st] December 2022, due to decrease of market value, a depreciation has been applied €34 637 (see note 17 below).

4 Post balance sheet events

4.1 Ongoing litigation with Zalthabar

On 30[th] December 2022, when Zalthabar were expected to leave the premises, the Corporation was asked to approve a further three month extension to the lease term, taking it to 31[st] March 2023 it being understood that there would be a waiver of rent for the month of February 2023 when the Corporation required access to the building to carry out structural tests.

Unfortunately, The Zalthabar company has remained in the premises and has not made any payment since January 1, 2023. On April 6, 2023, HBHC requested from the interim relief judge the payment of a daily provisional indemnity equal to twice the last daily rent in force, in accordance with Article 13 of the lease, in addition to VAT, charges, taxes and accessories, it being specified that the decision is usually pronounce based on the contractual rent, which today amounts to the annual sum exclusive of taxes and charges of €747,637.92.

The Zalthabar company remains indebted at 1[st] April for the occupation indemnity calculated on the basis of the contractual rent, including VAT, charges, taxes and accessories, for a total amount of €249,576.53, broken down as follows:

Further rent will be due from April 1st until the date of vacation of the premises.

5 Income from investments

come from investments
2022 2021 2022 2021
€ € £ `£
Let property income
Rental income and indemnities 1 912 037 1 856 283 1 695 786 1 559 835
Other charges invoiced to tenants 912 391 727 664 809 200 611 456
2 824 428 2 583 947 2 504 986 2 171 291
Interest income
Exchange gain / (loss) - net 2 898 5 346 2 570 4 492
Grant 58 550 58 550 51 928 49 200
Total income from investments 2 885 876 2 647 843 2 559 484 2 224 983

25

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

6 Income from health services
Health services income
Patients’ fees CID
Grant
Right of lease on hospital building
Other
Total income from health services
7 Expenditure on raising funds
Let property expense
Expenses recoverable from tenants
Taxes recoverable from tenants
Property taxes
Other costs and expenses
Risk provisions (see below)
Interest on borrowings
Investment properties:
Interest on loans
Bank interest
Total expenditure on raising funds		 2022
2021
2022
2021
€
€
£
`£
..
..
..
..
..
..
63 566
53 415
63 566
53 415
2022
2021
2022
2021
€
€
£
£
488 624
263 582
433 361
221 488
423 766
464 082
375 838
389 968
34 937
70 772
30 986
59 470
68 170
422 021
60 460
354 624
(808 469)
266 901
(717 031)
224 277
207 028
1 487 358
183 614
1 249 827
15 075
101 577
13 370
85 355
93 045
617
82 522
518
315 148
1 589 552
279 506
1 335 700

26

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

8 Health services and other expenditure

Provision of health services
Staff costs
Materials and consumables
Laundry
Other external costs
Taxes, other than income
Provisions
Other costs and expenses
Depreciation
Hospital:
Buildings
Intangible assets
Total health services and other expenditure		 2022
2021
2022
2021
€
€
£
£
(1 231)
(1 034)
12 410
10 428
..
..
..
..
..
..
(178 848)
(150 286)
..
58
(167 669)
(140 892)
107 609
123 285
95 438
103 596
..
..
107 609
(44 384)
95 438
(37 296)

9 Charitable activities

The direct provision of health services ceased when the CID was disposed of in January 2021 and, throughout 2022, the Corporation charitable activity consisted in making premises available freely to:

The Corporation also makes an annual grant to the BCF (which amounted to €114 550 (£101 594) in 2022) and to other charities based in France but with UK ties and whose charitable objects are aligned with those of the Corporation (these grants amounted to €15 150 (£13 437) in 2022).

27

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

10 Staff costs

Salary costs
Social security costs
Health services
Administration		 2022
2021
2022
2021
€
€
£
£
120 550
124 525
106 916
104 638
60 466
89 441
53 627
75 157
181 016
213 966
160 543
179 795
(1 231)
(1 034)
181 016
215 197
160 543
180 830
181 016
213 966
160 543
179 796

The trustees are not remunerated for their services, but some direct expenses incurred in the performance of their duties are reimbursed.

The average number of employees for the year was as follows:

2022
Total
Health
Administrative staff
1
..
Total
1
..
Emoluments of employees:
Above £70 000 (€80 000)
Between £62 000 and £72 000 (€70 000 and €80 000)
Below £62 000 (€70 000)
Total		 2022 2021
Total
Health
1
..		 Admin.
Total
Health
Admin.
1
1
..
1
1
..		 1
1
..
1
2022
2021
1
1
..
..
..
..
1
1

The total gross remuneration of the three highest paid employees was €118 017 (£104 669) for the year ended 31[st] December 2022 (€186 490 / £156 707in 2021).

Employee salaries are set in accordance with the collective bargaining agreement for the sector: the “Convention Collective National” dated 31 October 1951.

11 Indemnity insurance

Included in the costs for the provision of health services are the following premiums paid on an insurance policy which provides cover for losses arising from the neglect or default of the Directors, employees or agents and indemnification of the Directors against the consequences of any neglect or default on their part.

rt.
2022 2021 2022 2021
€ € £ £
Premiums 860 3 122 763 2 623

28

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

12 Governance costs

These costs can be analysed as follows:

overnance costs
ese costs can be analysed as follows:
Staff costs
Provision for retirement indemnities
Audit fee
Legal fees
Other fees and expenditures
Depreciation
Net book value of assets sold
Impairment of financial assets		 2022
2021
2022
2021
€
€
£
£
181 016
215 197
160 543
180 830
..
..
..
..
24 959
16 932
22 136
14 228
33
4 753
29
3 994
258 238
302 480
229 031
254 174
1 622
755
1 439
634
195 594
173 472
34 637
30 720
696 099
540 117
617 370
453 860

29

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

13 Taxation

The Corporation is registered as a non-profit association in France under the law of 1[st] July 1901 and, as such, is only subject to income tax on the net profit arising from investment properties at a rate of 24% and on certain financial income at a rate of 10%.

The tax computation on rental income is as follows for the years to 31[st] December:

Investment
Property
Income
Financial
Investment
Income



 Taxable income from investment
properties
Management costs
Insurance
Real estate and related taxes
Depreciation
Adjustment to amounts recovered
from tenants
Improvements
Interest income		 31 Dec.
2022
31 Dec.
2021
31 Dec.
2022
31 Dec.
2021
€
€
£
£
41 099
369 537
36 451
312 412
-6 841
-30 952
-6 067
-26 167
..
..
..
..
-9 083
-60 961
-8 056
-51 537
-2 486
-18 674
-2 205
-15 787
..
..
..
..
-10 049
-7 841
-8 912
-6 629
..
..
..
..
Total rental income
Income on capitalization contracts*
Other financial income		 12 640
251 109
11 210
212 291
64 057
..
56 812
..
4 957
42
4 396
35
Total financial income
Total Income before loss
carried forward
Loss carried forward from prior year
Total taxable income
Tax charge for the year
Loss carried forward :
At 1st January 2022
Loss carried forward
At 31st December 2022		 69 014
42
61 209
35


81 654
251 151
72 419
212 327
-81 654
-251 151
-72 419
-212 327
..
..
..
..
..
..
..
..
-261 197
-512 348
-231 656
-433 147
81 654
251 151
72 419
212 327
-179 543
-261 197
-159 237
-220 820

*The actuarial interest rate equal to 105 % of the monthly rate for long-term government loans known on the contract subscription date, i.e. : 1.63% * 105 % = 1.71 %.

30

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

14 Intangible assets

Intangible assets comprise establishment costs and computer software licenses as and are as follows:

2022 2021 2022 2021
€ € £ £
Cost 9 290 9 290 8 239 7 806
Aggregate depreciation (9 290) (9 290) (8 239) (7 806)
.. .. .. ..
ngible assets
ngible assets are as follows:
Summary (in € and £) Total Buildings Other tangible Total Buildings Other tangible
health services fixed assets - health services fixed assets –
(see B below) Admin. (see B below) Admin.
(see C below) (see C below)
€ € € £ £ £
Cost or valuation
At 1stJanuary 2021 10 853 001 10 825 659 27 342 9 119 773 9 096 799 22 974
Additions .. ..
Retirements (920 198) (920 198) () (816 123) (816 123) ()
Exchange difference .. .. .. (505 751) (504 477) (1 274)
At 31stDecember 2021 9 932 803 9 905 461 27 342 8 809 401 8 758 153 24 248
Aggregate depreciation
At 1st January 2022 8 434 128 8 413 960 20 168 7 087 195 7 070 250 16 945
Charge for the year 109 231 107 609 1 622 96 878 95 439 1 439
Retirements (724 604) (724 604) () (642 651) (642 651) ()
Exchange difference .. .. .. (393 029) (392 090) (929)
At 31stDecember 2022 7 818 755 7 796 965 21 790 6 934 451 6 915 128 19 323
Net book value
At 1stJanuary 2022 2 418 873 2 411 699 7 174 2 032 578 2 026 549 6 029
At 31stDecember 2022 2 114 048 2 108 496 5 552 1 874 950 1 870 025 4 925

15 Tangible assets

Tangible assets are as follows:

31

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

The detailed analysis of the tangible fixed assets is as follows:

Health service (in €)
Cost
At 1stJanuary 2022
Disposals
At 31stDecember 2022
Aggregate depreciation
At 1st January 2022
Charge for the year
Disposals
At 31stDecember 2022
Net book value
At 1stJanuary 2022
At 31stDecember 2022
Health service (in £)
Cost
At 1stJanuary 2022
Disposals
Exchange difference
At 31stDecember 2022
Aggregate depreciation
At 1st January 2022
Charge for the year
Disposals
Exchange difference
At 31stDecember 2022
Net book value
At 1stJanuary 2022
At 31stDecember 2022		 Total
Buildings
Hospital
1990
Buildings
Hospital
1982
Buildings
Hospital
1974
Part of
Buildings
Barbès
Part of land
Barbès
€
€
€
€
€
€
10 825 659
3 046 184
5 265 953
1 593 324
846 435
73 763
(920 198)
(846 435)
(73 763)
9 905 461
3 046 184
5 265 953
1 593 324
8 413 960
2 160 400
3 936 624
1 593 324
723 612
..
107 609
25 237
81 380
992
..
(724 604)
724 604
7 796 965
2 185 637
4 018 004
1 593 324
..
2 411 699
885 784
1 329 329
..
122 823
73 763
2 108 496
860 547
1 247 949
..
Total
Buildings
Hospital
1990
Buildings
Hospital
1982
Buildings
Hospital
1974
Part of
Buildings
Barbès
Part of land
Barbès
£
£
£
£
£
£
9 096 799
2 559 708
4 424 980
1 338 870
711 259
61 983
(816 123)
(750 703)
(65 420)
504 477
141 953
245 394
74 249
39 444
3 437
8 785 153
2 701 661
4 670 374
1 413 119
7 070 250
1 815 384
3 307 945
1 338 870
608 051
..
95 439
22 383
72 176
880
..
(642 651)
(642 651)
392 090
100 674
183 447
74 249
33 720
..
6 915 128
1 938 441
3 563 568
1 413 119
..
2 026 549
744 324
1 117 035
..
103 208
61 983
1 870 025
763 220
1 106 806
..

32

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

Other fixed assets -
Admin (in € and £)
Cost
At 1stJanuary 2022
Additions
Retirements
Exchange differences
At 31stDecember 2022
Aggregate depreciation
At 1stJanuary 2022
Charge for the year
Retirements
Exchange differences
At 31stDecember 2022
Net book value
At 1stJanuary 2022
At 31stDecember 2022		 Total
Furniture
Computer
equipment
Total
Furniture
Computer
equipment
€
€
€
£
£
£
27 341
20 407
6 934
22 974
17 147
5 826
()
()
()
()
()
()
..
..
..
()
()
()
27 341
20 407
6 934
20 168
18 762
1 406
16 945
15 766
1 179
1 622
1 442
180
1 439
1 279
160
()
()
()
..
..
..
939
874
65
21 786
20 204
1 582
19 322
17 919
1 403
7 175
1 645
5 530
6 029
1 382
4 647
5 555
203
5 352
4 927
180
4 747

33

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

16 Investment properties

Historical cost
At 1stJanuary 2022
Additions
Disposal of 12 rue Barbès (see note3.5)
Exchange difference
At 31stDecember 2022
Market value
At 1stJanuary 2022
Fixed assets – increase
Disposal of 12 rue Barbès
Revaluation of properties
Exchange difference
At 31stDecember 2022		 Total
Total
€
£
25 397 314
21 341 363
218 133
193 462
(4 635 166)
(4 110 929)
1 183 515
20 980 281
18 607 411
57 900 000
48 653 371
218 133
193 462
(12 100 000)
(10 731 490)
(1 949 552)
(1 729 058)
..
2 698 139)
44 068 581
39 084 424

Investment properties are all located in Levallois-Perret in France and, at 31[st] December 2021, included:

On 18[th] February 2022, the land and buildings located at 12 rue Barbès were sold for a total consideration of €12 100 000 (£10 731 490). This amount has been allocated pro-rata between the land and buildings shown as investment property and those shown as tangible fixed assets (see note 16.2 below).

16.1 Valuation of investment properties

The independent valuation of the original hospital (the “Chateau”) was carried out in early 2023 by Savills. The Wallace Gardens offices were last valued (also by Savills) at 31[st] December 2021.

16.2 Land and buildings at 12 rue Barbès

Although the Barbès building was principally held for investment purposes, approximately one third of the floor area of the building was occupied by the British Charitable Fund, apartments and the CID and these parts are recorded as tangible fixed assets. The remaining two-thirds of the building were held for openmarket letting purposes and were recorded as an investment property. Land was also considered to be held in similar proportions.

16.3 Secretary of State for the Environment

The land on which are situated the current hospital buildings and the Villiers investment properties (which include the original hospital building now converted to offices) was, together with the buildings then existing, the subject of a gift on 30 July 1898 in favour of the predecessor of the United Kingdom Secretary of State for the Environment. He was deemed, under English law, to have accepted the gift of the land in his capacity of trustee for the original hospital charity. Following a scheme of arrangement dated 2[nd] November 1977, the Charity Commissioners for England and Wales confirmed that the land and buildings continue to be vested in the Secretary of State for the Environment and that their management and administration is undertaken by the members of the Council of Management of the Corporation who are also Trustees of the charity.

34

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

17 Financial asset

Financial assets are as follows:

Summary (in € and £)
Cost or valuation
At 1stJanuary 2022
Additions
Retirements
Exchange difference
At 31stDecember 2022
Aggregate depreciation
At 1st January 2022
Charge for the year
Retirements
Exchange difference
At 31stDecember 2022
Net book value
At 1stJanuary 2021
At 31stDecember 2021		 Total
Total
€
£
230
193
10 600 000
9 401 140
..
..
..
11
10 600 230
9 401 344
..
..
34 637
30 720
..
..
..
..
34 637
30 720
230
193
10 565 593
9 370 624

18 Debtors

Debtors comprise the following at 31[st] December:

Income not yet invoiced (rental on Batigère
lease)
Accounts receivable net of depreciation
Other debtors and prepayments
VAT
Receivable from IHFB (now HFB-FCJ)
Investment grant from ARS to be received
from IHFB (now HFB-FCJ)
Investment grant on cost overrun of the
smoke extraction system to be received from
IHFB (now HFB-FCJ)		 2022
2021
2022
2021
€
€
£
£
994 127
1 372 461
881 691
1 153 279
759 711
717 074
673 788
602 557
76 150
100 953
67 538
84 832
101 740
125 581
90 233
105 526
215 950
234 315
191 526
196 895
30 377
123 700
26 941
103 945
45 857
64 200
40 671
53 947
2 223 912
2 738 284
1 672 388
2 300 981

35

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

19 Sinking fund

A sinking fund has been set up to meet unforeseen expenses. As of 31[st] December 2023, this fund has a balance of €29 957 /£26 569 (2021 € 100 042 / £84 065). The amount is invested in a passbook savings account and earned interest of € 4 957/ £ 4 396 for the year ended 31[st] December 2022 (2021 € 42/ £35). This fund is included in current assets and in rental income and indemnities as non-material income.

This "sinking fund" was planned to face future cost of refurbishment but there is in fact no constraint on its use and, in 2020, given the difficulties described in note 3, part of it was used to finance current operations.

20 Current liabilities

Current liabilities comprise the following at 31[st] December:

Social debt
Suppliers
Due to tenant Batigère
Deposits received from tenants
VAT
Other taxes
IHFB contribution (see below)
Rent paid in advance – Orange
Due to IHFB (now HFB-FCJ)
Accrued interest on loans
Other creditors and accruals		 2022
2021
2022
2021
€
€
£
£
34 770
38 904
30 838
32 691
232 510
306 021
206 213
257 149
441 326
370 846
426 216
650 697
378 011
546 781
340 010
278 150
301 555
233 729
126
1 751
112
1 471
..
..
457 280
9 154
405 562
7 692
79
16 015
70
13 457
21 876
18 382
29 897
25 122
1 490 991
1 793 791
1 322 361
1 507 320

21 Loans

21.1 Summary

Details of outstanding loans are as follows at 31[st] December:

2022 2021 2022 2021
€ € £ £
Short-term bank loans 1 424 908 1 197 350
Short-term portion of property loans 229 413 1 793 013 203 466 1 506 669
Total short-term loans 229 413 3 217 921 203 466 2 704 019
Long-term portion of property loans 536 341 765 754 475 681 643 463
Total loans 765 754 3 983 675 679 147 3 347 482

36

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

21.2 Property loans in detail

At 1stJanuary 2022
Dexia Credit Local
Société Générale
Crédit du Nord
Total
At 31stDecember 2022
Dexia Credit Local
Société Générale
Crédit du Nord
Total		 Total
Long-term
Short-term
Total
Long-term
Short-term
Note
€
€
€
£
£
£
1 501 786
..
1 501 786
1 261 951
..
1 261 951
123 699
30 377
93 322
103 944
25 526
78 418
933 282
735 377
197 905
784 237
617 937
166 300
2 558 767
765 754
1 793 013
2 150 132
643 463
1 506 669
(a)
(b)
30 377
30 377
26 941
26 941
(c)
735 377
536 341
199 036
652 206
475 681
176 525
765 754
536 341
229 413
679 147
475 681
203 466

The details of the loans subscribed and the balances due at

Amount Amount drawn Amount due at Duration Interest rate
subscribed down at 31stDec. 22
31stDec. 22
€ € €
Dexia Credit Local (a) 8 700 000 8 700 000 15 years from 5.70% fixed rate
December 2008
Société Générale (b) 850 000 850 000 30 377 12 years from 5.70% fixed rate
September 2009
Crédit du Nord (c) 999 000 999 000 735 377 6 years from August 0.25% initial rate
2020

22 Provisions

The provisions at the year end and the movements in the year can be analysed as follows:

At 1st January
Retirement indemnities – see (a) below
Additions in the year
Retirement indemnities
Reversed in the year
Retirement indemnities
Exchange difference
At 31st December
Retirement indemnities
Total		 2022
2021
2022
2021
€
€
£
£
133 490
120 008
133 490
120 008
..
..
..
..
(133 490)
(112 172)
..
..
(7 836)
..
133 490
..
..
..
133 490
..
..

37

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

23 Investment grants

The investment grants received for the fitting of a smoke extraction system in the hospital building and movements thereon are as follows:

vestment grants
e investment grants received for the fitting
ovements thereon are as follows:		 of a smoke extraction system in the hospital building and
Initial investment grant
Additional grant
Total in €
Total in £
Exchange difference
Total in £		 31 Dec. 2021
Increases
Reductions
31 Dec. 2022
€
€
€
€
397 729
..
42 500
355 229
150 201
..
16 050
134 151
547 930
..
58 550
489 380
463 980
..
51 928
412 052
19 134
..
..
16 422
483 114
..
428 474

In 2011, the Corporation recorded the commitment received from the Oeuvre du Perpétuel Secours (“OPS”) to retrocede to it the payments received from the Regional Health Agency of Ile de France for its investment support aimed at financing the upgrading of hospital buildings, such as those appearing in the treaty for the partial contribution of assets from the Corporation to OPS dated 2008. This support amounted at the time to €850 000 and this sum was expected to cover all of the work.

In this context, the Corporation recognized in its accounts the hospital smoke extraction work which was completed in 2011 for a total cost of € 1,171,000 and accounted for two investment grants: one for the financial debt that it contracted to finance the works (i.e. € 850,000) and a second for the investment which exceeded the initial budget covered by the financing described above, i.e. € 321,000 that OPS has committed to repay in full over 10 years (see note 3.3)

Investment grants are amortized over the depreciation period for the work, ie 20 years.

38

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

24 Unrestricted funds

Revaluation reserve
1967 revaluation of land at rue Barbès
1974 revaluation of other fixed assets
Unrealised gain on investment properties
Revaluation reserve
Total revaluation reserve
Special reserves
Investment reserve
Treasury reserve
Total special reserves
Other reserves
Reserve for refurbishment of assets
1982 grant received from the “Service de la
coordination de l’Action Economique du
département des Hauts de Seine »
Various other funds
Total other reserves
General funds
Total other reserves
Total unrestricted funds		 2022
2021
2022
2021
€
€
£
£
198 184
198 184
175 769
166 534
472 195
472 195
418 790
396 785
670 379
670 379
594 559
563 319
23 088 300
32 502 687
20 477 013
27 312 008
23 758 679
33 173 066
21 071 572
27 875 327
173 130
173 130
153 549
145 481
549 156
549 156
487 046
461 456
722 286
722 286
640 595
606 937
1 000 000
1 000 000
886 900
840 300
1 102 352
1 102 352
977 676
926 306
1 310 983
1 310 983
1 162 711
1 101 619
3 413 335
3 413 335
3 027 287
2 868 225
30 612 952
21 381 097
27 150 628
17 966 536
34 026 287
24 794 432
30 177 915
20 834 761
58 507 252
58 689 784
51 890 082
49 317 025

As described in note 16.1, the Chateau property was independently valued at 31[st] December 2022 and this ended to a € -1 949 552 (£ 1 729 058) decrease in the revaluation reserve.

The other funds shown above include various donations received over the years. The Directors have qualified these funds as non-designated or general funds on the basis of available data and because, to the best of the knowledge of those involved in preparing the financial information, there is no contradictory information that would lead to this qualification being questioned. This is consistent with the way in which such funds were previously reported.

39

HBHC_Footnotes_31_Dec_22_Council Approval.docx

HERTFORD BRITISH HOSPITAL CORPORATION, Paris Notes to the financial statements Year ended 31[st] December 2022

25 Reconciliation to French financial reporting

Given its status in France and French law, the books and records of the Corporation are maintained under French accounting standards using the French chart of accounts and restated for the purposes of this financial reporting. The net result reported for the year ended 31[st] December and its reconciliation to the net movement in funds after taxation as reported herein can be reconciled as follows:

Net profit for the year per French accounts
Reconciling items
Disposal of investment assets : 12 Barbès
Investment asset : 12 Barbès
Depreciation of investment assets : 12 Barbès
Revaluation of investment assets
Difference in depreciation charge
Net movement in funds after taxation		 2022
2021
€
€
11 463 280
(45 398)
Impacted items
(12 100 000)
Unrealized gain & loss
4 653 200
Unrealized gain & loss
(2 820 093)
General funds
(1 949 552) 3 252 263
Unrealized gain & loss
570 630
671 525
General funds
(182 530)
3 878 389

The reconciliation of net equity per the French accounts and the total unrestricted funds is as follows:

Net equity per French accounts
Reconciling items
Revaluation of assets
Cumulative difference in depreciation charge
Other
Total unrestricted funds		 2022
2021
€
€
20 573 750
9 110 472
23 088 300
17 212 128
14 845 202
17 076 634
(9)
58 507 252
58 689 784

26 Off balance sheet commitments

26.1 Other reserves

The grant of €1 102 352 received in 1982 from the Service for the Coordination of Economic Action of the Department of Hauts-de-Seine is definitively acquired over a period of 40 years. In the event that the Corporation should leave the French social security system, a pro-rata temporis reimbursement will apply. As of 31[st] December 2022, the liability is extinguished.

26.2 Other commitments

The Corporation granted Dexia Crédit Local a first rank mortgage on the building located at 12 rue Barbès in Levallois-Perret as a guarantee for the repayment of any amount due in principal for the loan granted by Dexia Crédit Local on 23rd August 2007 for the financing of the renovations and rehabilitation of buildings located in Levallois-Perret at 48 rue de Villiers (the Château), at 2 rue Voltaire and 1 rue Barbès (together, Wallace Gardens). The initial loan amount was €8 700 000.

The Corporation also granted to Dexia Crédit Local a charge over the rental stream rents received for the Wallace Gardens buildings as security for this same loan.

Both these commitments ceased to apply on 18[th] February 2022 when the loan was repaid in full.

40

HBHC_Footnotes_31_Dec_22_Council Approval.docx