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2021-03-31-accounts

Annual Report 2020/21

Celebrating the past year

Report and Financial Statements 2020/21 Year ended 31 March 2021

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This year...
20,000
local churches
mobilised
2,479,200
people reached
through our
emergency response
1,417,000
people reached
through community
development
£81.4m
raised to transform lives
around the world
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We’re working in more than 50 countries to bring an end to extreme poverty...

Asia & the Middle East Africa Rwanda Americas Afghanistan Angola Sierra Leone Bolivia Bangladesh Burkina Faso South Sudan Brazil Cambodia Burundi Tanzania Colombia Central Asian States (3) Central African Uganda Guatemala China Republic (CAR) Zambia Haiti India Chad Zimbabwe Honduras Indonesia Democratic Nicaragua Iraq Republic of USA Jordan Congo (DRC) Europe Laos Ethiopia UK Lebanon Ivory Coast Myanmar Kenya Nepal Liberia Pakistan Malawi Philippines Mali Syria Mozambique Thailand Niger Yemen Nigeria

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1
Country in
Europe
20
Countries across
Asia and the
8 Middle East
Countries across
the Americas
22
Countries across
Africa
Raising awareness and mobilising the church
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Contents

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08–11
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We want to see the global church embrace its calling to address poverty and injustice.

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12–15
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We want to see disaster-affected communities supported and equipped to recover quickly and be more resilient to future disasters.

We want to see local churches and communities working sustainably and holistically to reduce poverty and build resilience.

Copyright © Tearfund 2021. All rights reserved.

A company limited by guarantee, registered in England and Wales. Company registration number 00994339. Registered Charity No. 265464 (England & Wales) Registered Charity No. SC037624 (Scotland)

Cover image: Orbisa lives in Afar, north-east Ethiopia, where Tearfund is working with Friendship Support Association (FSA) to set up solar-powered wells that will provide clean water to local villages Photo: Chris Hoskins/Tearfund

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20–23
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We want to see unjust policies and practices of the powerful challenged in order to secure policies that deliver justice for poor communities.

Photos top to bottom: Cetelci Sison/Tearfund, Edouard Saidi/Tearfund, Jerome Mulambya/Tearfund, Richard Tilney-Bassett/Tearfund

*Raising awareness and mobilising the church to act and speak out on justice and poverty

Sharing the bread of life

Annual Report and Financial Statements 2020/21 . 3

2 . Annual Report and Financial Statements 2020/21

Sharing the bread of life

In countless communities across the world, the local church has inspired projects that have sustained people throughout the pandemic. The new Kushinga Bakery in rural Karikiriki in Zimbabwe has proved a lifeline to a community cut off from normal food supplies because of lockdown.

The bakery was set up quickly but it’s the culmination of years of effort and prayer invested by Pastor Kenneth Makwenda and his church. They’ve learnt to press on with community projects, through frustration and failure, and trust God that change would come, as Pastor Kenneth explains...

I’ve been a pastor for 27 years and the Church and Community Transformation programme (CCT) has changed my life. We started running CCT in about 2015, first in Zindoga then in three other places. Now it’s our model for community development and we have used it as a foundation for many other programmes at church.

When we started CCT, we had very little response. One of the problems had been that any time a non-governmental organisation (NGO) comes into a community, people expect handouts. We started with big numbers but then when people realised there were no handouts coming, numbers dropped to about 20, all of them women. That was very consistent for the first few years. Our projects really struggled.

The bakery in Karikiriki came about after our training on self-help groups. Initially, it was just six women who wanted to feed their families and generate an income to educate their kids. But now, with local demand, they have got a desire to grow the business because the market is huge.

It’s been a new thing to see women like these working together, particularly in a community that is so politically polarised. But here are women from different churches, different backgrounds, coming together to do something.

When we started our CCT programme in Karikiriki we had about 12 people. But now we have over 60 people. The bakery project is probably one of the projects that has influenced people to think what these churches are doing is fruitful and helpful. So we have seen more women joining in.

We’ve also introduced a goat project through our CCT and self-help group programme. Initially it was a gift to us from the UK and the One Church network of which we’re part. We ended up distributing about 206 goats in Karikiriki and Zindoga. It’s something that had never happened before: most of the big things happen through NGOs, but this has happened through us, the church. And that was really a God moment.

Most of the people that have benefited from the goats project are women and children. We don’t see any reason why the parents involved can’t pay school fees for their children now. But I think the goat project will have a big impact on our men too. Usually, men are very practical and they want to see tangible things happening. We have started to see men responding, many coming to our meetings and some even coming to church.

CCT is now a part of our DNA as a church. It’s in our curriculum for training pastors. We see ourselves as a church that will be salt and light to the community. Projects like the bakery and the goats have really impacted the community because they see the church is doing something practical that can transform people’s lives.

They have started small. But they could grow it easily, with more pots and pans, more flour, maybe a piece of land where they can build a proper bakery. I foresee these women supplying bread to other communities beyond Karikiriki.

Women at the bakery in Karikiriki Photo: Stewart Muchapera/Tearfund

Kenneth Makwenda, pastor of One Church in Zimbabwe Photo: Stewart Muchapera/Tearfund

4 . Annual Report and Financial Statements 2020/21

Chair’s introduction

CEO’s introduction

Annual Report and Financial Statements 2020/21 . 5

Chair’s introduction

I have great pleasure in introducing the Annual Report for 2020/21.

Anna Laszlo, Chair

Photo: Margaret Chandler/Tearfund

What a different place the world is from this time last year. Back then it was clear that Covid-19 would have a significant impact on the churches and communities we work with, and on ourselves. But I don’t think anyone could have envisaged the scale of that impact. Here in the UK our lives have been deeply impacted: having to stay at home; having to teach our children at home; pausing work, losing work, or working far beyond normal expectations; for some of us, tragically, losing people we love. We have found this so hard. Yet, in some of the world’s poorest countries, the impact has been literally devastating. For many, being told to stay at home has meant being unable to feed their children. Losing work has thrown families back into the poverty from which they felt they had escaped. We have heard from staff around the world that it is not Covid which is the biggest threat to people’s lives, but the attempts to control the virus.

entitled ‘Crisis to Kairos’, acknowledges this is a time for action, for change, for transformation.

to racial justice and recognised that we have not always acted as we should. We launched an organisationwide programme of education on racial injustice, and have strengthened our commitment to tackle racism within our own structures. The Board is establishing a Diversity and Inclusion Committee to oversee this, and inclusion work more broadly, including setting recruitment targets over the coming year to help improve diversity within our workforce.

We know there will be huge secondary impacts of Covid-19, particularly on economic and social structures. A ‘K-shaped’ recovery looks increasingly likely, with the richest people continuing to build wealth, while the poorest people fall further into poverty. We have had big wake-up calls on racial injustice, and the need to take big decisions to protect our world and tackle the climate crisis. Youth and urbanisation will be huge drivers of change over the coming years, particularly in the majority world. We are hearing increasing calls, rightly, for a more local approach to addressing the needs of communities. The internet offers great opportunities, but there is also a risk of a ‘digital divide’, with those without access being excluded from paths out of poverty.

As they prayed back in January 2020, our Global Leadership team felt God warning we were heading for choppy waters, and assuring us that he would see us through. We are not through yet. But God’s presence and provision have been astonishingly evident over this year. Having seen that, we can go forward trusting in him, knowing that, as we remain in the Vine (John 15), God will continue to guide and provide so that we can serve him wherever he leads us.

Key themes for us as we go forward include how we continue our move towards bringing decision-making closer to the countries in which we work, and strengthening leadership responsibilities and capabilities across our teams; how our operating models should change to give us greater flexibility and ability to respond; and how we develop our work and engagement with the church here in the UK. We will be taking forward this thinking over the coming year.

In this environment we have worked to respond to changing needs and priorities. We have added to and adapted our planned programmes and activities. We have pivoted and flexed. All the while, we have trusted God and worked closely through our partner and ally, the local church, to bring hope and demonstrate God’s love and concern for his world, even in the deepest darkness.

Anna Laszlo Chair

Recognising the significance of the pandemic to the contexts and people we serve, and potentially to our income, we have spent time reviewing key drivers for our work and structures into the medium term. Our review,

Internally, we were shaken by the murder of George Floyd and challenged by the global outpouring of anger and grief this prompted. We reviewed our own approaches

CEO’s introduction

It is a privilege for me as Tearfund’s Chief Executive to present this Annual Report to you.

Nigel Harris, CEO

Photo: Margaret Chandler/Tearfund

For all of us, this has been a year like no other. The pandemic has affected everyone, but throughout the world it is the poorest, most disadvantaged and most marginalised people who have been hit the hardest. The health and economic effects of the Covid-19 crisis threaten to reverse decades of progress made in global development, pushing many millions back into absolute poverty. With the world’s attention focused elsewhere, conflict and violence continue to cause misery for so many in the most fragile states. We have seen increasing political tensions and the withdrawal of freedoms in many countries in which Tearfund works. Climate change continues to be a huge challenge, requiring urgent action. The murder of George Floyd in the US highlighted the racial injustice that is endemic in our world. The shock of the seismic events of this year gives us an opportunity to ‘reboot’, but the world must seize this moment.

Over the last year, we have run an unprecedented global response to Covid-19 in virtually all of the countries in which Tearfund works. Initially, we provided support around public health messaging, working with church leaders and partners to ensure accurate, reliable and timely information. We have supplied food parcels, hygiene and sanitation products, water stations, cash and food vouchers, and we are now supporting devastated communities to rebuild livelihoods and incomes. And we are advocating for fair and equitable access to vaccines.

economies around the world. Our Reboot campaign has sparked conversations across the UK church, and has been translated into policy asks of the UK Government. At global level, Tearfund's advocacy success on the UK Government ending fossil fuel finance overseas received praise from The Climate Coalition and recognition across the sector. We also soft-launched the Climate Emergency Toolkit in collaboration with multiple allies.

And we have seen extraordinary, sacrificial giving from Tearfund’s supporters: from individuals, churches and foundations. At a time of a profound financial shock, we have been humbled by the generosity we have received. As we have responded to huge need and supported the church to bring ‘good news to the poor’, we have seen God provide, and we are so grateful to all who support Tearfund’s work. This truly has been a year where Christians have stood in solidarity with those who live in poverty.

It has been deeply encouraging to see the response of churches that have been through Tearfund’s Church and Community Transformation process. Amid the huge challenges created by the pandemic, churches have had an attitude of hope, belief and duty to help those who were in greatest need, despite many struggles of their own. They have been a witness to those around them, showing the love of Jesus in life-saving ways to their communities. We have seen the power of local churches to walk with their communities, to respond, to recover and rebuild. Our commitment is to go further, to envision and equip the church around the world to be an active player in transforming lives and bringing hope. We are committed to scaling up our work across our corporate priorities and to collaborate with the church and our partners to see long-lasting transformation.

Yet we have hope that the church can bring good news to those living in poverty. We have seen churches across the world respond to the pandemic; we have seen the church speak out on issues of justice. We know that Jesus Christ brings transformation to individuals and communities who live in poverty. As Tearfund, we look forward in the hope and expectation that our God will bring the restoration of relationships. We stay true to our Christcentred foundation. Trust has been such a strong and recurring theme for Tearfund this year. In the darkness, in the complexity, in the uncertainty, we have walked in the knowledge that Jesus holds us, that he is sovereign and that we can and must be rooted in him, not reliant on ourselves.

Let me also pay tribute to Tearfund’s staff teams around the world for all their remarkable work in these unprecedented times. And as we look forward, we walk in trust, knowing that unless the Lord builds the house, we labour in vain. We seek his will and we ask for his equipping, so we may bring glory to him in all we do.

We have seen continued impact through our advocacy and influencing work. We recognise the unique opportunity for a fairer, greener Nigel Harris response as we look to rebuild CEO

6 . Annual Report and Financial Statements 2020/21

Trustee Directors’ report

Trustee Directors’ report

Annual Report and Financial Statements 2020/21 . 7

Trustee Directors’ report

The Board of Trustee Directors present their annual report, together with the audited, consolidated financial statements, for the year ended 31 March 2021.

Principal activity

Tearfund is a Christian relief and development agency committed to eradicating poverty. Tearfund’s call over the last 50 years has remained constant: to follow our biblical mandate to see people lifted out of material and spiritual poverty.

In our most recent business plan, we affirmed our commitment to our Christian distinctiveness, to our distinctly Christian role in the international development sector, our evangelical Christian identity, our calling and our values.

Our vision is to see people freed from poverty, living transformed lives and reaching their God-given potential.

Our mission is to follow Jesus where the need is greatest, responding to crises and partnering with local churches to bring restoration to people living in poverty.

Our values remain unchanged: we seek to be Christ-centred, compassionate, courageous, truthful and servant-hearted.

In pursuit of our vision, there are four main outcomes we want to see:

Churches mobilised

Emergency needs met

The church is envisioned, strengthened and equipped to play its part in the transformation of the poorest communities and in changing society.

Immediate needs are met when crises and natural disasters hit and community structures and mechanisms are affected.

Communities transformed

Society changed

The poorest communities are resilient to shocks and stresses, working for peace and unity, and contributing to better futures for themselves and others.

Social, political, economic and environmental systems and policies work for the poorest communities, ensuring access to basic needs, reduced inequality and sustainable growth.

In our financial statements we use these four outcomes as a means of reporting the expenditure on our charitable activities. We recognise it is difficult to make full allowance for the overlaps and interconnections between these outcomes and we will consider whether in future years there are improvements we can make to our reporting to reflect this.

Our corporate priorities

Our corporate priorities are our key strategic priorities that we have agreed for the medium term, that we consider we are uniquely placed to deliver, and that will enable us to contribute to transformational change in the countries in which we work.

To achieve our outcomes, we will continue to scale up our work, to see ongoing impact across our three corporate priorities:

Church and Community

Transformation (CCT): unlocking the potential of

local churches and communities, to see change happening in even the most remote areas in a cost-effective, holistic and sustainable way.

In 2020/21, we continued to strengthen and scale up CCT, working with our country and cluster teams, supporting them to implement their CCT strategies. Focus areas included developing training capacity within countries so that CCT facilitators and trainers can be trained without the need for external support. This was especially important when Covid-19 travel restrictions were in force. We invested in understanding and mapping our engagement with whole denominations for CCT scaleup. Adaptations to the regular CCT processes have continued to ensure that teams in more challenging contexts have processes that work for them. We were able to support many of the churches, denominations and networks engaged in CCT to respond to Covid-19 from a biblical perspective. Many churches were able to take Tearfund resources and adapt them to become the guidelines for their denomination.

Fragile States: committing

to places of protracted crisis and conflict for the long haul, to see communities thrive as peace, hope and relationships are restored.

In 2020/21, we continued our work with country teams to develop strategies and projects that work on addressing the root causes of fragility. We had key successes in expanding our work to support faith leaders in promoting fair and peaceful elections, and addressing harmful norms, attitudes and behaviours that lead to violence in

communities and households. We also worked hard to support local churches working with other faith leaders, as they collaborated to reduce intimate partner violence, especially important with the impacts of Covid-19, and to distribute personal protective equipment (PPE) and promote hygiene messaging to reduce the spread of the virus.

Environmental and Economic Sustainability (EES): committing to relief and development that is environmentally and economically sustainable and reduces exposure to and the impact of risk. We are called to take care of the whole of God’s creation.

In 2020/21, despite the challenges posed by Covid-19, we were able to continue implementing 14 existing EES projects, and started two new ones. We successfully secured funding of £2 million from NORAD (Norwegian Agency for Development Cooperation) to implement a joint advocacy and waste-management project in north-east Nigeria for the next three years. On the advocacy front, we launched the Reboot campaign and we continued to work closely with The Climate Coalition to influence the UK Government: we launched a new policy paper on clean energy access, specifically about subsidies for distributed renewable electricity and clean cooking, and in December, the Climate Emergency Toolkit went live. We also won a decisive victory in December 2020, after years of campaigning and lobbying, when the UK Government committed to stop supporting fossil fuels overseas. Internally, the Walk the Talk group, who promote environmentally-friendly and sustainable ways to carry out our work, established an international subgroup to focus specifically on our cluster and country teams.

We work across six clusters:

• Asia

(LAC)

Previously, the vast majority of staff in these teams were based in the UK but over the past four years we

have gradually transitioned these teams and hired people from within each cluster. The clusters are staffed and led mostly by people from that region, bringing leadership support and decision-making closer to the communities in which we are supporting change.

Our partners are local churches, denominations and Christian national and international NGOs who agree with our Statement of Faith and meet our partnership criteria. Tearfund’s operational programmes are undertaken in countries hit by largescale disasters, where the availability and capacity of partners are limited. Such programmes are directly overseen and implemented by staff members according to our policies and standards of good practice.

Tearfund is a member of various alliances and networks that provide important support to its work in a number of areas. These include: the Disasters Emergency Committee (DEC), BOND (a network of organisations working in international development), Micah Network, the Integral Alliance, the Start Network, Joint Learning Initiative (JLI) and the Evangelical Alliance.

We continue to work closely with members of the worldwide Tearfund family, looking for opportunities for greater collaboration and to increase our global reach. Over the last year, we have been working with Tearfund family members to develop and launch a shared brand. This common global brand makes us visually identifiable as members of the same global body, sharing ideas, resources and time with each other to achieve individual and shared goals.

We have referred to the Charity Commission’s guidance on reporting on public benefit as we prepared this Annual Report. Tearfund and its partners work with the most vulnerable and marginalised people around the world, regardless of race, religion, ethnicity, ability, age, gender, sexuality or nationality, and the Trustee Directors ensure that the activities undertaken contribute to the aims and objectives of the charity. The Trustee Directors are therefore confident that Tearfund meets the public benefit requirements.

8 . Annual Report and Financial Statements 2020/21

Strategic report

Annual Report and Financial Statements 2020/21 . 9

Strategic report

The Trustee Directors present the strategic report which details our progress made against our key objectives set last year and our aims for 2021/22.

We want to see churches mobilised

We believe that we’re invited to be part of God’s mission to bring lasting, whole-life transformation to people, communities and creation. We also believe that God has chosen the church as his partner in this and we have the privilege of journeying with local churches worldwide in the desire to see the whole of creation restored.

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We believe that the church has a
vital and distinctive role within civil
society, at both local and global
level, to transform the poorest
communities and tackle injustice. Our
key foundation is ‘integral mission’,
which understands that God is working
to restore broken relationships by
11p 10p responding holistically to people’s
11p needs, including economic, emotional,
37p spiritual and physical ones. The church,
9p 34p as the body of Christ, is called to help fulfil this mission.
We are actively scaling up Church
25p and Community Transformation (CCT)
One Pound
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Our teams in Asia and Africa continue their pioneering work integrating CCT into theological curriculums, which are changing fast. In Africa, we’ve also initiated dialogues on how to ensure theological education reflects and responds to the local context – working towards a transformational theology from Africa, for Africa.

What makes us different

As the pandemic unfolded, we were able to help churches and Christian networks respond holistically, meeting both practical and spiritual needs. In this and other disasters, churches and communities were able to act quickly and effectively through their grounding in CCT. Our biblical resources proved an important and distinctive support for them as they responded to the needs around them.

We are actively scaling up Church and Community Transformation (CCT) by inspiring denominations to work out their faith by meeting people’s practical needs, and supporting them to do so. We’re also extending this scale-up to other NGOs. One tool we’re now using widely is the Light Wheel (a tool for measuring holistic change), which helps define what it means for a community to flourish, and proposes practical steps churches can take towards this goal.

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10p
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in every pound goes to mobilising the local church

This year, we're celebrating:

20,000

local churches mobilised

3,500

new facilitators supported and empowered to mobilise their churches and lead transformation processes

877

church leaders and theologians representing at least 34 countries taking part in 36 events online

663,000

engagements with Tearfund’s learning resources (online and print)

Alison Mwale (44) was part of a group of 20 from his community in Salima, central Malawi, who took part in forestry skills training. Following the training, they planted two hectares of forest and they work to develop and maintain it. In addition to caring for the environment in his area, Alison is also an active member of the church and sings in the choir Photo: Marcus Perkins/Tearfund

10 . Annual Report and Financial Statements 2020/21

Strategic report

Annual Report and Financial Statements 2020/21 . 11

These are the key objectives we set ourselves last year, with examples of how we met them.

1. Grow our CCT facilitators’ skills and confidence to bring prayer, Bible reflection and discipleship into their work

We have continued to invest in our CCT facilitators and help grow their skills, knowledge and resilience this year despite restrictions imposed in response to the pandemic. During lockdowns, CCT teams around the world responded quickly by using online platforms and social messaging services to enable Bible reflection and discipleship to continue. Some even sent out hard copies of Bible study resources to facilitators and church members.

A key development this year has been mobilising and equipping facilitators to integrate Local Houses of Prayer into their CCT process. Local Houses of Prayer is a movement wherein Christians ‘adopt’ a small local area, making it the focus of their prayer, witness and worship. There are now 100 Local Houses of Prayer linked to CCT in Chad alone.

Key Tearfund staff in Chad, Nigeria, Zambia and Nepal referred in interviews to noticeable trends in areas where this integration had happened. These included: stronger relationships within the church, and between the congregation and wider community; greater commitment to and understanding of integral mission; more local resources (such as people’s time, equipment and finances) being mobilised; and a reduction in harmful behaviours in the community such as drug misuse.

2. Equip churches and Christians to be more inclusive in their responses to poverty and injustice, by providing theological materials and resources on diversity and inclusion

3. Adapt our CCT approaches for oral cultures, so we reach them more effectively and have greater impact

Our pilot adapting CCT for oral cultures on diversity and inclusion is yielding strong results. The training Tearfund’s Theory of Poverty points manual to help communities start towards broken relationships being at their CCT journey is being rewritten the root of all forms of poverty, and so that the whole process can be restoring these relationships is at the facilitated entirely orally. Writing is heart of our mission. We also believe replaced by memory aids, including that to see restored relationships the use of drama, drawings and within society, we need to model singing. Reading is replaced by them ourselves as an organisation. listening, repeating, and stopping at strategic moments to reflect on what This year we have developed an has been heard and what it means. accessible theological framework on ‘diversity and inclusion’, focusing Sixteen facilitators are going through especially on gender, disability, and race the training process and are piloting and ethnicity. A number of resources the approach in Sierra Leone. have been developed and events The facilitators all reported that hosted – for staff, our partners and participation and inclusion has greatly beyond – to enhance our engagement, improved and people’s understanding understanding and knowledge on and retention of the material has been these issues.

Sixteen facilitators are going through the training process and are piloting the approach in Sierra Leone. The facilitators all reported that participation and inclusion has greatly improved and people’s understanding and retention of the material has been stronger and deeper. The process is moving faster than where the original (written) content has been used, as participants are grasping concepts more readily and remembering more. This has increased the ability to reflect and put learnings into practice. Interestingly, those who are unable to read and write are, in many cases, grasping concepts quicker than those who are used to conventional facilitation techniques, which is shifting power dynamics in the churches.

For example, we developed two Bible studies for a Black Lives Matter toolkit for churches (in the UK and further afield) to engage people with racial justice issues. These Bible studies formed the basis of a four-day study on racial injustice on the YouVersion app, developed by Tearfund USA.

To articulate our mission more clearly, we also developed a video around Tearfund’s Theory of Poverty. In Africa, online conversations that we facilitated with 13 African Christian networks inspired 580 participants from 60 theological institutions across the continent to start moving towards a more contextual curriculum. Meanwhile, our office in India hosted an online event about integral mission attended by more than 200 people.

The oral techniques are proving so effective that the team are also weaving them into their standard CCT training, and they report that people’s enthusiasm for the process has further increased and its momentum has gathered pace.

What we learnt

Our fruitful partnership with the Anglican Alliance, a strategic ally in our efforts to scale-up CCT, has taught us the value of networks and denominations in furthering integral mission and alleviating poverty, due to their influence and reach. Covid-19 restrictions proved that technology can increase diversity and inclusion by enabling truly global gatherings with diverse voices in different languages.

We know we can go further

We want to do more to develop online training and resources. Although we provided these at local level around the world, we have been slower to provide centralised resources for CCT practitioners. This will be a focus for next year.

We also need to be more agile and work harder to bring the voices and concerns of young people into all that we do.

This year £8.4m spent on mobilising churches

In 2020/21, we spent a total of £8.4m (2019/20 £10.6m) on mobilising churches through CCT training at theological institutions such as ASDECS.

Going forward in 2021/22, we aim to:

  1. develop a clear strategy for how to mobilise denominations towards CCT

  2. intentionally engage with youth around church mobilisation and use mechanisms that encourage youth engagement and leadership (such as e-learnings, movements etc)

3. equip churches and

Children playing traditional Filipino games Photo: Cetelci Sison/Tearfund

12 . Annual Report and Financial Statements 2020/21

Strategic report

Annual Report and Financial Statements 2020/21 . 13

This year, we're celebrating:

We want to see emergency needs met

Emergencies are growing in complexity, frequency and duration, and we respond to them swiftly and effectively. We’re committed to equipping local people to lead that response. So we work closely with local partners and churches to reduce disasters’ impact by building communities’ resilience, helping them prepare and mitigating the risks.

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Our approach to emergency response
is born of the belief that every person
is made in the image of God, with
inherent dignity and worth. So we are
determined to support those who are
hardest to reach and those most in
need. We’re committed to impartiality
11p 10p at every stage of an emergency
11p response and to supporting the
37p most vulnerable, regardless of
9p 34p race, religion, ethnicity, ability, age,
gender, sexuality or nationality.
We are passionate about equipping
25p and supporting our local partners so
One Pound
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and the local church to recover from the global pandemic and ‘build back better’. We integrate resilience strengthening and disaster risk reduction within our response and recovery work. This means people are better able to anticipate, adapt to, absorb and recover from the effects of both natural and manmade disasters.

What makes us different

We are passionate about equipping and supporting our local partners so that responses are both localised and contextualised. We seek to respond to immediate needs and we work hard to address underlying vulnerabilities and weak coping mechanisms that can cause or exacerbate disasters and crises.

Our real strength lies in the long-established relationships we have with local churches and Christian networks around the world. These relationships and networks enabled us to respond to the Covid-19 pandemic in more than 40 countries this year. It is the strength of these bonds that allows us to support long-term recovery and to help communities build resilience for future disasters and crises.

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34p
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Involving faith communities is crucial in our approach to disaster preparedness and emergency response. As the world faces the impacts of Covid-19, Tearfund continues to work with faith leaders

in every pound goes to meeting emergency needs

2,479,200

people reached through our emergency response, including:

1,378,200

reached through our Covid-19 response

203,400

reached through our emergency response programmes in South Sudan

30,000

people who received cash, food and hygiene kits in the troubled Tigray region of Ethiopia

A member of the Disaster Management Committee in a village near Nawalparasi, Nepal where UMN, Tearfund’s partner, supports schools to create safe evacuation plans Photo: Chris Hoskins/Tearfund

14 . Annual Report and Financial Statements 2020/21

Strategic report

Annual Report and Financial Statements 2020/21 . 15

These are the key objectives we set ourselves last year, with examples of how we met them.

1. Continue to respond to new and 2. Work with church transformation ongoing emergencies, with our new specialists to update existing church regional humanitarian network mobilisation resources by integrating of staff enabling a more localised disaster management

response

Covid-19 provided an unprecedented opportunity for faith leaders and local churches to respond directly to emergency needs. The church has been instrumental in reaching the most vulnerable and continues to respond to the pandemic, including through mobilising community resources, coordinating distributions, providing psychosocial support, reaching out to people in isolation and launching mass-awareness campaigns around key health messaging. Local faith leaders have been pivotal in countering misinformation and promoting positive health messages around transmission and prevention, thanks to the respect and trust they hold.

In a global crisis unprecedented in recent history, our Covid-19 response extended to almost every country where Tearfund works, thanks to our supporters and our partners. We worked closely with local churches and partners to spread public health information and guidance, and provide practical support including hygiene kits, handwashing stations, food and livelihoods support. We also harnessed funding for this through our Tap Twinning appeal, as well as from the Disasters Emergency Committee Covid-19 appeal which specifically supported our work in Afghanistan, Bangladesh, the Democratic Republic of Congo (DRC), South Sudan and Yemen. Through funding from the Start Network, we provided rapid assistance in Burundi, Zimbabwe, Mozambique, South Sudan and Indonesia, as well as public health messaging, hygiene kits and cash assistance in high-risk areas of Afghanistan, Ethiopia and Nigeria.

We have also continued to work with local churches to integrate disaster preparedness into existing church-based approaches, with a particular focus on being adaptive and contextual. For example, in Zimbabwe this has meant using indigenous practices within farming; in Haiti churches are collecting data on vulnerable groups to ensure their inclusion in essential services; and in Indonesia the focus has been on working in partnership with the wider community. All this builds resilience, ensuring that people have secure livelihoods, the most vulnerable are included and communities are working together to make the best of local knowledge and opportunities – building strong foundations in readiness for any future disaster.

In parallel, we have provided continued support to protracted humanitarian crises in South Sudan, DRC, and Venezuelan refugees in Colombia (alongside Tearfund Netherlands in all three countries, and Tearfund Canada in South Sudan and Colombia). We have also responded to new crises such as the Beirut explosion in August 2020.

Tearfund's regional humanitarian staff have played a key role in responding to localised emergencies and supporting in-country teams and our partners. Collaboration between humanitarian colleagues in different regions has enabled peer-to-peer learning and experience-sharing, as well as mentoring and accompaniment.

3. Roll out our capacity strengthening programme to at least nine further countries, and review it after year two, to improve the process and to assess our partners’ ability to respond effectively

The Disaster Management Capacity Assessment programme, which has been running since 2019, aims to strengthen partners working in humanitarian preparedness and response. The pandemic has delayed us starting the programme in certain countries and in delivering many planned capacity-sharing opportunities. Currently the programme is operating in six countries and is set to roll out in Haiti and four of our Asia cluster countries next year, subject to travel restrictions. Despite this year’s challenges, much has still been achieved through new ways of working remotely and online training delivery: ten partners across West Africa were trained in monitoring and evaluation systems for emergencies, for example.

We have seen the benefits of shared learning and knowledge through the outworking of our partners’ Covid-19 responses. The humanitarian crisis in Burkina Faso has meant our partners there have put into practice our training in areas such as developing proposals and reporting back to government donors, as well as devising humanitarian strategies and emergency preparedness plans; a partner whom we trained in cash programming and delivery also made good use of this training this year. In Nigeria, partners drew on previous training in accountability to make improvements in how they selected communities to work with and to introduce innovations such as complaints points where people could give feedback.

What we learnt

The church is most effective when it’s involved in every stage of an emergency response: from initial design to mobilising volunteers; from distributing goods to supporting people’s well-being. We must continue to support and strengthen the local church through contextually appropriate resources and approaches. To this end, Tearfund and partner humanitarian specialists are working with churches and communities to identify the gaps the pandemic has highlighted.

We know we can go further

A global review we commissioned highlighted the difficulties our incountry teams had in planning against uncertain or piecemeal allocation of funding and the uncertain scale of the unfolding emergency.

Going forward, we will strengthen our preparedness at country level through improved analysis of the impact of an emergency, and allocate funding to countries in clearly defined amounts, allowing them to plan more effectively.

This year £28.5m spent meeting emergency needs

In 2020/21, we spent a total of £28.5m (2019/20 £33.4m) on meeting emergency needs and supporting those such as the community in Katindo.

Going forward in 2021/22, we aim to:

1. work alongside church

Pastor Nzumba washing his hands at the new handwashing station Photo: Edouard Saidi/Tearfund

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This year, we're celebrating:

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in every pound goes to transforming communities

We want to see communities transformed

Experiences tells us that our impact will be deeper and longer-lasting when we work through the local church and organisations rooted in the community. These partnerships have proven powerful and agile in adjusting to local need, addressing root causes of poverty and ensuring inclusion so everyone has the greatest chance of reaching their God-given potential.

No person, no place on this planet, is excluded from God’s love: his restoration plan is for the whole of humanity and the whole of creation. We know he is there in situations where people who were already vulnerable or struggling with conflict or unrest have been hit hard by Covid-19, further jeopardising their health and their livelihoods. We know he is a friend and ally to those who are most vulnerable to the economic impacts of the pandemic, and to those worst affected by the climate emergency. We remain committed to following him to these places and serving alongside him.

What makes us different

The local churches and organisations which we partner with know we are committed to them for the long term. It is important that we flex and adjust to address immediate needs and pressures, but many of the issues communities face will only be resolved through sustained hard work, often over years. So the focus of our partnerships is long-term change that will release people from vicious cycles of poverty for good.

Where we can, we work through local churches – challenging and equipping them for community-led change. We help them address the immediate issues, but in ways that can contribute to lasting change and whole-life transformation. Our experience this year has reinforced our belief that the church can play a key role in bringing reconciliation and peace to troubled places, even as it addresses the immediate challenges people face.

1,417,000

people reached through community development, including:

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peacebuilding champions mobilised this year across five conflict-affected countries, bringing our total of peacebuilding champions to 666.

9,800

community volunteers trained to lead nearly 18,000 communities through transformative processes

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135
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denominations and church networks mobilised to scale up CCT with their own resources

Sara lives in Iraq, where she has received support from Tearfund’s partner to help deal with the loss of her father Photo: Ruth Towell/Tearfund

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These are the key objectives we set ourselves last year, with examples of how we met them.

1. In five countries, combine all 2. Start Environmental and Economic elements of our fragile states Sustainability (EES) pilot projects in framework into our programmes, to at least two new countries, creating test if greater impact can be had on 'green jobs' and bringing protection root causes of fragility and conflict and restoration to the local environment

2. Start Environmental and Economic 3. Continue to build our pool Sustainability (EES) pilot projects in of Church and Community at least two new countries, creating Transformation (CCT) trainers 'green jobs' and bringing protection across the world with strong links and restoration to the local to their communities, who can environment work closely with churches, local leaders and communities to apply This year, despite the pandemic, our transformational CCT process partner LAMB started a new waste management project in north-east With Covid-19 restrictions, country Bangladesh, as part of our EES work. teams had to shift to using digital They delivered more than 120 training technology and other means to courses on waste management to train and support facilitators – with 1,499 adults and 850 school students. considerable success. In Bolivia, the As a result, participants started to CCT facilitator initiated WhatsApp separate their organic and non-organic prayer and Bible study groups, regularly waste, for collection through services reaching 500 people, and an app was established via the project. In addition, developed to share training resources. young people formed Green Clubs, to In Nepal, the core Bible studies from promote good waste management their CCT process were distributed and take action to protect the to ten denominations and a Bible environment. We also started working training centre ahead of lockdown. with a new partner in Uganda called These resources were then shared with EcoBrixs whose work involves waste congregations via screenshots and collection and recycling plastics people held weekly online gatherings into marketable products. EcoBrixs to discuss their application. Similarly, recycles 30 tons of plastic waste in West Africa, just before lockdown, each year and employs 40 staff, of facilitators quickly distributed hard whom half are living with disabilities. copies of their Bible studies and The project provides an income for activities for families to use at home. 3,000 local people who are paid by New Bible studies were also written to weight for the plastics they gather. help people reflect on issues arising

This year, the number of countries that are intentionally combining different aspects of our fragile states approach has risen from three to ten. In Burundi, for example, our programmes with survivors of sexual and gender-based violence (SGBV) have incorporated work to transform harmful gender norms (including 5,000 community dialogues), improve food security and livelihoods, and enhance peacebuilding skills. New SGBV survivor groups have more than 1,000 members, while 41 new peacebuilding champions run regular peace clubs. Young people are now working across political divides to address underlying issues of poverty.

With Covid-19 restrictions, country teams had to shift to using digital technology and other means to train and support facilitators – with considerable success. In Bolivia, the CCT facilitator initiated WhatsApp prayer and Bible study groups, regularly reaching 500 people, and an app was developed to share training resources. In Nepal, the core Bible studies from their CCT process were distributed to ten denominations and a Bible training centre ahead of lockdown. These resources were then shared with congregations via screenshots and people held weekly online gatherings to discuss their application. Similarly, in West Africa, just before lockdown, facilitators quickly distributed hard copies of their Bible studies and activities for families to use at home. New Bible studies were also written to help people reflect on issues arising from the pandemic. In Malawi, our partner Eagles created an online training programme to train facilitators in the whole CCT process. Some 150 people have enrolled to date.

In Burkina Faso, Iraq and Nigeria, we have worked with Christian and Muslim faith leaders and local communities to combine peacebuilding, enhancing food security, inclusion, SGBV programmes, conflict resolution, and youth and women’s empowerment. The fruit of this work includes a reduction in intimate partner violence and new inter-faith, cross-community sports clubs for young people. In Nigeria, churches and mosques have worked together to support the most vulnerable during the pandemic.

We have also secured funds from the Norwegian government to start a project in Yola, north-east Nigeria. Over the next three years, a social enterprise will be set up to recycle 377 tonnes of plastic and provide an income for 3,000 households. The goal is to improve livelihoods for young people in vulnerable riverbank communities, and to pilot a set of guiding principles for partnership between the informal waste sector and private companies.

CCT-trained churches worldwide have stepped up significantly in responding to the pandemic, providing practical support as well as speaking up for communities. In Tanzania, for example, when the government started to bury at night those who had died of Covid-19, much to their families’ distress, the bishops of our CCT partners successfully lobbied for this practice to end.

Recognising that elections are often times of real tension, Tearfund mobilised 555 faith leaders in Burundi, 50 church leaders in Ivory Coast, and 200 church leaders and seminary students in Brazil to promote peace to both government officials and communities. Joint messaging and advocacy by Protestant, Catholic and Muslim senior leaders in Burundi, which had not been seen for years, contributed to making the 2020 elections some of the most peaceful in recent times.

What we learnt

We have learnt to adjust to Covid-19 restrictions using online meeting platforms and social messaging services, digital tools and telephones. But we also recognise that the commitment of passionate, motivated individuals at local level was key to this success. We will draw lessons about what can be done remotely and effectively, and also focus on supporting local champions for those things that cannot be done virtually.

We know we can go further

We want to do more to enable and equip young people to engage in peacebuilding, recognising the significant relationship between youth and drivers of conflict and fragility.

We want to focus more on economic resilience in our EES work, especially in post-pandemic recovery.

We plan to be more strategic in how we engage with denominations in order to achieve significant scale-up of CCT.

This year £21.5m spent on transforming communities

In 2020/21, we spent a total of £21.5m (2019/20 £20m) on transforming communities through projects such as ‘Light my Church, Light my Village’.

Going forward in 2021/22, we aim to:

  1. scale up our EES work in Nigeria (recycling), Yemen (solar power), Mozambique (environmental livelihoods) and across Latin American and the Caribbean (creation care and livelihoods)

  2. support others to help build relationships between communities in conflict and across social divides in ten countries

  3. mobilise 1,200 new church volunteers and train them to lead transformative processes in their communities

Mervis’ child completing his homework in the evening after school, thanks to the solar-powered light Photo: Jerome Mulambya/Tearfund

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This year, we're celebrating:

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9p

in every pound goes to helping change society

We want to see society changed

We want to see systems and policies change so that they tackle poverty and injustice and ensure that the whole of creation is protected. We hold decision-makers to account on these issues, and call on them to create political space for reform. We partner with local churches, national partners and international organisations to amplify the call for change.

obligations. This has led to faith

We’re passionate about seeing the needs and opinions of the world’s most vulnerable people brought to the table, so that decision-makers hear and act upon them. So we equip and support communities to make their case. We use advocacy and influence – with the church, government and the private sector – to bring poverty and injustice to light and to demand change. We influence decision-makers directly and help our partners to do the same.

leaders calling for international debt cancellation. We also encouraged and equipped churches in at least 25 countries to call on governments to meet the needs of communities worst affected by the pandemic in a green and fair way. This resulted in policy wins in countries such as Brazil, Malawi, Nigeria and the Democratic Republic of Congo.

What makes us different

In parallel, we inspire Christians in the UK and globally to campaign, pray and live out the change they want to see more widely. Renew Our World, the international advocacy movement we helped establish, now has expressions in 20 countries and counting, contributing to national and global action.

We leverage the church’s long reach and influence to ensure that the voices of more vulnerable communities are heard at local, national and international levels, amplifying them through our networks and advocacy movements. By working through local churches rooted in communities, we ensure that changes in policy and systems translate into change at community level.

This year, we launched our Reboot campaign, to engage Christians and church leaders to ask the UK Government for a green and fair recovery from the pandemic, consistent with international climate

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policies and practices changed to the benefit of people in poverty

285,500

campaign actions taken globally

20,000

people participating in our online training and mobilising events

+45 million

as the potential readership* of our Rubbish Campaign report, The Burning Question

*based on media coverage achieved

Through Bin Twinning partnering with EcoBrixs, plastic waste is being collected to be turned into bricks in Uganda, promoting recycling whilst also providing employment opportunities Photo: Richard Tilney-Bassett/Tearfund

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These are the key objectives we set ourselves last year, with examples of how we met them.

1. Influence policymakers at UN climate talks, rescheduled for 2021, to address the climate emergency; inspire and equip Christians to pray and act on climate change and plastic waste

COP26, the UN climate talks to be held in Glasgow in November 2020, were postponed for a year due to the pandemic. As a result, we pivoted our advocacy on the climate emergency to focus on a green and fair recovery. We launched the Reboot campaign with: a Restoring Societies paper; a World Rebooted resource for church leaders; and campaign actions for supporters, including a weekly prayer update with 1,700 subscribers.

In January 2021, we launched The Climate Emergency Toolkit in collaboration with ten other organisations, church leaders and activists, to help churches advocate on climate change ahead of COP26. Research we conducted with Youthscape Centre for Research highlighted Christian young people’s attitudes to faith, church and climate, which we used to push churches for greater climate action.

Our partnership with The Climate Coalition in the UK helped secure several notable campaign wins. These included the UK Government accelerating the phase-out of petrol and diesel cars and committing to stop supporting fossil fuels overseas. Together, we also organised the world’s first online climate lobby involving more than 15,000 people and more than 280 MPs. Following our groundbreaking report The Burning Question , on the links between plastic pollution and climate change, Nestlé announced it had cut its plastic footprint by ten per cent.

2. Contribute towards an international movement for change, supporting movement-building in strategic countries and contributing thought leadership on a restorative economy

An important part of our global movement-building work has been supporting youth leadership and activism. Working with others, we’ve supported young leaders in eight countries through training, mentoring, convening and providing a platform for their voices to be heard. We also developed an evaluation tool that helps movement-builders to measure and understand the movements they are engaged in, and to plan for growth and impact. The tool is now used in at least nine countries and we are sharing it with other practitioners globally as part of our thought leadership.

Following our training in Brazil, young activists started a petition against mining on indigenous lands. It attracted more than 63,000 signatures, and held policymakers to account on various environmental policies, including protecting the Camboatá forest in Rio.

Also with Tearfund support, young activists from seven African countries developed and shared policy points with the chair of the African Union, Cyril Ramaphosa, ahead of the African Union Summit in December. In Nigeria, Christian youth organisation Yola Renewal Foundation took Muslim youth through Tearfund’s Live Justly course, which combines a focus on peacebuilding with environmental and economic sustainability work. Meanwhile, our partner Jos Green Centre engaged hundreds of youth online in post-Covid-19 strategy discussions around green jobs, gaining coverage in local media.

3. Further catalyse local and regional efforts to uphold the rights of migrants and build on our pioneering church-led campaign in Latin America

Together with 64 partner organisations from across the region, we continued our church-led campaign, As Born Among Us , to support the eight million migrants and refugees in Latin America. The campaign, which now spans 12 countries, has mobilised 300 local churches to respond to the needs of migrants and refugees and advocate for their rights, including in relation to their legal status, their access to health care and access to support relating to Covid-19. For example, 55 faith leaders advocated at regional and national level for new laws and practices to protect migrants and meet their needs. Tearfund has gained recognition in the region as a thought leader and reliable partner on the issue, and recently convened 33 churches to share best practice in caring for migrants.

In light of Covid-19, we had to cancel our planned regional conference on ‘Church and migration’. Instead, we delivered a very successful online Global Theological Forum on this theme. This brought together 81 strategic thinkers and young theologians from 38 countries to discuss migration and the church’s response. As a result of this forum, church and theological partners in Central America are planning to replicate the As Born Among Us campaign in their region and in the US.

What we learnt

We’ve had to learn to adapt rapidly and shift the focus and delivery of our advocacy during the pandemic while remaining true to our vision and ethos. We saw that giving partners and allies freedom to work within their own communities enabled us to pivot swiftly in our emergency response. We learnt, as during the Ebola epidemic, that timely engagement of local faith leaders can influence public policy powerfully.

We know we can go further

We need to do even more to advocate for governments to prioritise the needs of the most vulnerable in their response to the pandemic.

Inspired by the Black Lives Matter movement, we need to make

stronger connections in our advocacy between racism, global poverty and environmental damage, and to amplify more powerfully the voices of people of colour.

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This year
£8.2m
spent on
changing society
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In 2020/21, we spent a total of £8.2m (2019/20 £9m) on changing society and supporting campaigns such as the As Born Among Us campaign.

Going forward in 2021/22, we aim to:

  1. influence the UK and other governments to significantly scale up and deliver on their climate change commitments, especially through the G7 and UN climate negotiations in 2021

  2. call for a green and fair recovery to the pandemic, for the key role of local faith actors to be recognised, and for equitable vaccine distribution; and support our partners and allies to do the same

  3. mobilise regional networks and movements to advocate and influence decisionmakers on environmental and justice issues

Food baskets are delivered to migrant families in the city of Cartagena, Colombia Photo: Edrei Cueto/Tearfund

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This year, we're celebrating:

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11p

in every pound is invested in fundraising

Our supporters give generously

Our supporters are at the heart of who we are as an organisation and central to all we are able to do. It is a key priority for us to build and nurture relationship with them, and connect them with the communities God is transforming through their partnership, generosity and prayers.

We are so thankful for the commitment and passion of our wonderful supporters who are integral to all we achieve, in Jesus’ name. Despite the difficult circumstances of this year, supporters have generously shared their resources in so many different ways: praying, giving regularly, pledging legacies, responding to financial appeals, promoting Tearfund’s work in their churches and workplaces, fundraising, campaigning and changing their lifestyles to improve the lives of those in the communities we serve.

have with supporters underlines just how vital they are to our work: we are passionate about helping them see the difference their gifts and prayers make. And we want our supporters to understand the power they have as campaigners to create change in their own lives and in society. We also recognise and value the trust that supporters have in Tearfund. So we endeavour always to be accountable and transparent, by stewarding supporters’ gifts diligently, monitoring our impact and reviewing our costs and spending regularly.

The relationship we have with our supporters is two-way. We want to honour them by listening, learning and communicating regularly with them. We actively seek their feedback, on our website and in our emails, and we will liaise with people individually following complaints or regular giving cancellations. We collate supporter feedback each month and circulate it widely across the organisation, including to the Executive team and Board.

What makes us different

Our faith is integral to our identity and how we respond to others, including our supporters. We see our supporters as our family in Christ, partners in our mission, fellow travellers. We work hard to ensure that every aspect of our fundraising and our spending expresses our Christian values of integrity, accountability and gratitude.

We try to ensure that every conversation and communication we

£81.4m

raised to transform lives around the world

£284,891

raised through the Big Quiz Night in which 462 churches participated

146,326

views of our online events, such as Tearfund Live and Tearfund Carols

10,071

taps twinned since our Tap Twinning appeal launched on 20 March 2020

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These are the key objectives we set ourselves last year, with examples of how we met them.

1. Introduce our latest campaign to supporters, highlighting our work in the Middle East and our corporate priority of fragile states

We had planned to launch our Home campaign focusing on refugees in the Middle East, and our work in fragile states, in April 2020. However, we took the decision to delay until September, following lockdowns in the UK.

The launch’s delay gave us extra time to tailor the way we communicated the theme to reflect concerns and circumstances arising from the pandemic, underscoring where Covid-19 had impacted our work.

A coordinated launch in September 2020 saw the first-ever Tear Times takeover, with the whole magazine devoted to the Middle East. This sat alongside a Harvest appeal featuring Lebanon and a campaign to recruit new supporters featuring Iraq. Both Tear Times and the Harvest appeal were very successful and we learnt valuable lessons about recruiting new supporters during lockdown.

2. Invest in digital communications and fundraising to capitalise on the growth of online fundraising and to introduce Tearfund to new and younger audiences

We treated Covid-19 as an incentive to accelerate our investment in digital fundraising. We adapted several existing products, such as Big Quiz Night , so they could be run online and we launched new digital-only fundraising campaigns, including The Climb and 21 for 21 .

As face-to-face events were not possible, we switched to hosting online events to engage with our supporters, which led to many generous gifts and new regular givers.

We also reflected on how we can communicate Tearfund’s brand and the transformational impact of our work more effectively to supporters and new audiences. We invested in a new website, to improve our supporters’ online experience, with a particular focus on accessibility. This investment will help us improve our online fundraising and personalise communications more effectively in future.

3. Review and update our strategy for engaging with churches in the UK to build stronger, mutually

supportive relationships

Teams in Global Advocacy & Influencing and Global Fundraising worked together to develop a new UK Church Engagement Strategy to ensure we present Tearfund clearly and consistently to all UK churches.

We are passionate in our aim to equip churches and individuals to act justly, pray boldly, give generously and live well on this earth. In particular, we want to increase Tearfund’s presence in growing church networks, Black Majority Churches, and with younger audiences.

We know that, even before the pandemic, the UK church was facing significant pressures including declining numbers and stretched finances. When lockdown restrictions forced churches to close this year, the UK church landscape changed dramatically. We recognise that it is vital that Tearfund adjusts in response through digital innovation and new initiatives that better serve and support church leaders.

What we learnt

Covid-19 has taught us the importance of being agile as our plans were seriously disrupted by restrictions on church services and the cancellation of festivals such as Big Church Day Out . We learnt to adapt quickly, for example providing an online version of Big Quiz Night and running new online events such as Tearfund Live and Tearfund Carols .

We know we can go further

We are acutely aware that our supporters do not represent the whole UK church. We need to become more diverse. Over the coming year, we will continue to prioritise engaging with a wider group of churches and supporters.

We know that we need to build on the success of our week-long prayer event, Declaration , featuring dynamic worship leaders and speakers of colour.

Going forward in 2021/22, we aim to:

  1. implement plans to engage a broader range of churches in the UK

  2. launch a campaign enabling

  3. supporters to help those affected by climate change and highlight the church's vital role in this

  4. continue to respond in agile ways to the changing fundraising environment through the use of digital and online activities

Participants of the Emerging Influencers programme on a video call Photo: Emma Borquaye/Tearfund

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Great supporter stories

Pounding the pavement brings fresh perspective

Ola took on our fundraising challenge, The Walk , because he was moved after learning about the arduous treks people such as Orbisa in Ethiopia take every day to find water.

He set himself a target of walking five miles a day – and recruited his tenweek-old son to join him, albeit in his buggy. Together, father and son raised almost £500 for our work.

‘It was a bit of a challenge to walk at night after work,’ Ola says. ‘But it gives me that head space I need and looking at nature gives me a completely different thing to focus on.’

Climate activists lobby MPs online

In June our supporters joined others from The Climate Coalition in the firstever virtual mass lobby of parliament, calling on MPs to push for a green and fair recovery to the pandemic.

Dr David Golding had met his MP, Sir Alan Campbell, at a Tearfund reception in 2018 (pictured). This time they met online – but the meeting was just as powerful. David says, ‘We had a brilliant meeting and our MP promised to bring our proposals to the attention of the Prime Minister. What sticks in my memory is sixth-former Anna’s closing plea, “I ask you not to let my generation down!”’

Creative cake-making and compassion for Yemen

Phoebe may be little but she’s made a huge impact, thanks to her creativity in the kitchen.

The four-year-old decided she wanted to raise money for our Yemen appeal, the world’s worst humanitarian crisis this year.

So she busied herself in the kitchen, with a bit of help from Mum, and produced delicious brownies which she then sold and posted to friends. In total, she sold 184 packs of her cakes and raised an amazing £1,981.

Making the best of lockdown to twin bins and loos

Graham, who’s 81, decided to make the most of his enforced isolation during lockdown by taking on a sporty fundraising challenge.

Graham set himself the target of climbing his stairs 500 times to support the Democratic Republic of Congo, an ‘often forgotten’ country close to his heart.

He split the £270 he raised in sponsorship between Toilet Twinning and Bin Twinning , a new fundraising campaign we launched in September to support waste-management and recycling projects overseas.

Big-hearted Doris shares her big birthday

Doris’s 100th birthday coincided with lockdown but she decided to celebrate her big day by sharing it with some of the world’s poorest people.

Instead of asking for gifts for herself, Doris invited family and friends to donate to Tearfund. And, despite not being able to have a party, she raised a staggering £1,136.

Photos provided by Tearfund supporters

Featured event: Declaration

This January, we held a week-long schedule of prayer, teaching and worship events, online and on Christian TV channel TBN. We would like to thank the following for helping make this event a reality:

Rev Yemi Adedeji Karen Gibson MBE Chisom Akurienne Pastor Susan Graham James Aladiran Pete Greig Jordan Amadi-Myers Bishop Delroy Hall Celia Apeagyei-Collins Lord Michael Hastings Michael Ayo Pastor Agu Irukwu Samuel Bella Pastor Les Isaac OBE Mark Beswick Krish Kandiah Pastor ChiChi Bismark Rev Betty King Pastor Yvonne Brooks Jenny Lee Minister Nicky Brown Angie Le Mar Rev Leondre Douglas Bishop Wayne Malcolm Pastor Bruce Dyer Minister Leoné Martin Shemara Fletcher William McDowell Becca Folkes Rev Dr Otis Moss III Bishop John Francis Pastor Peter Nembhard Elder Juanita Francis Jason Nicholson-Porter Rev Roshard Gibbons Oliver Nyumbu

Sarah Ogunji Abbiih Oloyede Pastor Jonathan Oloyede Sarah Onduko Apostle Jacqueline Peart Dr Garrett Pennant Claudine Reid MBE Rev Sharlette Reid Pastor Leke Sanusi Pastor Bryan Scott Rev David Shosanya Emmanuel Smith Naomi Sterling Selina Stone Samuel Titi-Lartey Archbishop Justin Welby Pastor Michael White

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Live worship being filmed at the TBN studio
Photo: TBN UK
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Annual Report and Financial Statements 2020/21 . 31

Stakeholder engagement

Stakeholder engagement

Stakeholder engagement

Trustee Directors are required to explain how they consider the interests of key stakeholders and the broader matters set out in Section 172 of the Companies Act 2006 in promoting the success of the company for the achievement of its charitable purposes. In order to assist Trustee Directors with these duties, all papers submitted to the Board identify the areas of S172 to which they relate. This statement focuses on matters of strategic importance and the level of information disclosed in this statement is consistent with the size and complexity of the business.

General confirmation of Trustee Directors’ duties Tearfund’s Board has a clear framework for determining the matters within its remit and has approved Terms of Reference for the matters delegated to its Committees. Pages 34–38 explain the roles and responsibilities of the five Committees and highlight some of their principal areas of involvement and decisions taken during 2020/21. When making decisions, each Trustee Director ensures that they act in good faith to best promote the company’s success for the achievement of its charitable purposes, and in doing so will have regard (among other matters) to:

S172(1) (a) ‘The likely consequences of any decision in the long term’ Tackling deep-rooted challenges needs long-term vision and commitment. In reaffirming the three core areas of our work, namely Church and Community Transformation (CCT), Fragile States, and Environmental and Economic Sustainability (EES), the Board ensures Tearfund has a clear strategic focus (see page 7). Each of these corporate priorities has detailed three-year plans and the Board receives regular reports on their progress and challenges.

In September 2020 the Board considered whether the impacts of the Covid pandemic required Tearfund

to make adjustments to any of these long-term plans and priorities, specifically in relation to CCT. While the effect of lockdowns had been to disrupt and delay many of our planned activities, including training and mobilising events across the globe, it was exciting to see the many creative ways that communities and partners were able to adapt, notably by shifting to virtual interactions. Churches which were just beginning their CCT journey saw more clearly that they had a role to play that went well beyond the spiritual support to the communities around them. Moreover, we experienced a strong demand for Tearfund information and resources from churches where we had no previous connection or relationship. We concluded that CCT has been shown to be a very valuable method to prepare the church for protecting communities during the pandemic and for caring for the most vulnerable during this time. It will be key for us to work on how we help the church to translate the shortterm Covid-focused interest into longterm transformational change. We built on these decisions in the Business Plan (approved in March 2021) when we specifically sought to apply the learnings from the pandemic to each of the corporate priorities.

S172(1) (b) ‘The interests of the company’s employees’

The Board recognises that Tearfund employees are our most important asset and are fundamental to the delivery of our strategic ambitions. Our success depends on attracting, retaining, motivating and developing them, wherever they are located in the world. The annual staff survey is one of the Board’s principal tools to measure employee engagement, motivation and commitment to Tearfund, with a consistently high response rate. It enables the Board to understand how we are learning from survey findings to strengthen Tearfund culture and values, and informs decision-making from pay and benefits to health,

safety and wellbeing. During the pandemic we have supported staff to work remotely and carried out more frequent surveys to ensure that the impacts on wellbeing are understood and risks mitigated where possible.

We have reported previously that Tearfund was in transition to becoming a much more global organisation, with the geographic cluster model anchoring our work more clearly in-region. During 2020/21 this trend accelerated as virtual working, enforced by Covid lockdowns, ensured that all global participants in meetings were present on the same basis as everyone else, a hugely positive development.

S172(1) (c) ‘The need to foster the company’s business relationships with suppliers, customers and others’ Tearfund’s key business relationships are with: churches and other partners; the communities with whom we work; our suppliers; and our donors and supporters. This is not an exhaustive list – other key stakeholders include Tearfund family members and the Charity Commission. Our engagement with these stakeholders is referenced within this report.

In order to deliver our mission and strategy, and to create impact at scale, we need to work with others. We will continue to work in our traditional way through in-country partners, and at the same time build our capacity to work through partnerships, alliances, networks and movements, both Christian and secular. We will continue to position Tearfund as a thought leader in faith and development through these relationships.

There is growing recognition of the role of youth in acting, engaging, leading and being agents of change on climate, environmental and sustainability issues. We have therefore decided to increase our focus on youth engagement, leadership and action, particularly in our EES work.

The importance we attach to building relationships with our committed, generous donors and supporters is affirmed on pages 24–29. We are strengthening relationships with our suppliers by entering into framework agreements and clear contractual terms and conditions. We will continue to roll out our global procurement system over the coming year, giving greatly enhanced visibility over our supply chain. The Board receives regular updates on stakeholder engagement, ranging from aspects of our corporate priorities work to supporter surveys which underlie our global fundraising strategy.

S172(1) (d) ‘The impact of the company’s operations on the community and the environment’ In the Business Plan approved by the Board in March 2021, we explain how we are increasingly seeing overlaps and interconnections between the corporate priorities. It would not be unusual to see an EES project taking place in a fragile state using CCT methodology, or for communities to understand their environmental and economic responsibilities and opportunities as a consequence of our work on root causes in fragile states. Transformation of communities is reaffirmed as one of the main outcomes we want to see, with the poorest communities resilient to shocks and stresses, working for peace and unity, and contributing

to better futures for themselves and others (see pages 16–19).

Our EES work happens at community, national and global levels, as we build movements of people to pursue a world which brings together the aims of meeting basic needs, living within environmental limits and nonacceptance of inequality. Our advocacy efforts are focused on waste, climate, and environment and many of these have been effective in getting through to those global policy and decision makers who can influence significant change. We are continuing to develop the reporting of our own environmental performance (see page 46).

S172(1) (e) ‘The desirability of the company maintaining a reputation for high standards of business conduct’

It is crucial that Tearfund maintains its reputation for high standards of conduct, not least because local churches around the world are affected by our work and reputation. Reputation is one of the six areas of impact that we use to evaluate all corporate risks, to ensure it informs all key decision-making. In September 2020 the Board discussed the results of a review by the Internal Audit team into Tearfund’s compliance with the Charity Governance Code. The review concluded that the majority of the recommended practices set out in the Code are in place,

while recommendations for further improvements included a continuing focus on evaluation of the charity’s impact; the nature and frequency for review of feedback received from the communities we serve; and confirmation of the format for an annual review of Board effectiveness.

Last year we reported on the development of a strategic dashboard to track our top-level key performance indicators (KPIs) and qualitative data and to monitor how well we are outworking our strategy. In the Business Plan approved by the Board in March 2021, we set out the details of these KPIs. They are designed to demonstrate progress in meeting the outcomes we want to see – churches mobilised, emergency needs met, communities transformed and society changed – as well as to measure our operational, organisational and financial health. The KPIs include both quantitative and qualitative measures of impact; staff survey results; carbon emissions; and key income and expenditure data.

S172(1) (f) ‘The need to act fairly as between members of the company’ is not relevant to Tearfund’s organisational structure, as the charity is run in the interests of its charitable objects rather than in the interests of its members. Nevertheless we meet and engage with our members at Tearfund’s Annual General Meeting.

32 . Annual Report and Financial Statements 2020/21

Annual Report and Financial Statements 2020/21 . 33

Structure, governance and management

Structure, governance and management

Structure, governance and management

Tearfund is a registered charity in England and Wales and in Scotland. It is also a registered company limited by guarantee in England and Wales. It is governed by a memorandum and articles of association.

through team briefings and other internal channels such as specific communications on particular matters of concern and weekly ‘In Touch’ emails to all staff. Tearfund holds regular meetings with a staff representation body (the Staff Council) to consider and act on the views and concerns of employees, and to consult on relevant issues. We are in the process of piloting a Staff Council in Southern and East Africa and aim to establish Staff Councils in each of our other five clusters.

Organisation

During 2020/21, a review was undertaken of the governance practices and arrangements of the Board compared to the Charity Governance Code. The review found that most of the recommended practices in the Code are in place. Where recommendations for improvements were made, the Board agreed an action plan to address them. The actions which have not already been completed will be addressed during 2021/22.

The Board of Trustee Directors holds formal, all-day meetings four times a year, as well as other ad hoc meetings and events. The Board is ultimately responsible for strategic decisions, having taken advice from the Chief Executive and Executive team. Trustee Directors are appointed by the Members at the Annual General Meeting. The Trustee Directors may also appoint a Trustee Director to serve until the next Annual General Meeting, at which time they cease to hold office but are eligible for election. The procedures for appointment and induction of Trustee Directors are set out in the Tearfund Board manual.

The Board has delegated approval for day-to-day operational decisions up to certain financial thresholds to the Chief Executive and other Executive team members under a Scheme of Delegation to enable them to coordinate and direct Tearfund’s work worldwide. All decisions above these thresholds must be approved by the Board. The Board has also reserved to itself certain important decisions, such as major initiatives, appointment of the senior executives and approval of the long-term objectives and strategy.

We also hold regular informationsharing and question-and-answer sessions throughout the year with the CEO and executive directors to ensure that employees have the opportunity to hear about and ask questions on matters affecting them. The CEO and other directors frequently engage with staff, sharing information about the work of Tearfund and about operational, financial and other factors impacting our work. When reaching key decisions, the directors are always careful to consider employee interests and the impact that their decisions will have on our staff and the communities we serve.

Trustee Directors’ recruitment is undertaken by the Board in consultation with the Chief Executive and Executive team. An induction programme is run for new Trustee Directors which will include visiting overseas programmes to gain a wider appreciation of Tearfund’s work when Covid restrictions allow.

In March 2019, the Board carried out a re-evaluation of the skills and experience required to be present in the Trustee Directors. Where key gaps were identified, these have now been filled.

Members

The Members constitute the ultimate authority within Tearfund’s governance structure. They are appointed at the invitation of the Trustee Directors, with a focus on people who have a longstanding association with Tearfund and who care deeply for its mission and ministry. They are entitled to attend all general meetings, including the Annual General Meeting (AGM). They receive the Annual Report and financial statements, elect or re-elect Trustee Directors, appoint auditors and fix the remuneration of the auditors. Regular contact is maintained with Members through quarterly communications and informal contact with the management and Trustee Directors.

Volunteers

The financial statements do not reflect the considerable and vital support given to Tearfund by more than 1,750 volunteers in the UK, and countless more overseas. Their help is at the heart of Tearfund’s work: they bring life to the organisation and help it to operate effectively. The many roles they undertake include encouraging prayer, campaigning, acting within their local churches and communities, enthusing others, engaging with local media and championing lifestyle changes. We celebrate the enormous contribution made by so many of our volunteers in organising or participating in fundraising activities in their homes, churches and communities. This volunteer network is a distinctive aspect of Tearfund’s approach and

The current composition of the Board of Trustee Directors is set out on pages 48–49. Trustee Directors are appointed for three years and serve a maximum of three terms unless exceptional circumstances apply. As permitted by the Articles of Association, the Trustee Directors have the benefit of a qualifying third party indemnity provision as defined by Section 234 of the Companies Act 2006. The indemnity was in force throughout the financial year and remains in force. The company also purchases Directors’ and Officers’ liability insurance in respect of itself and its Trustee Directors. Trustee Directors receive no remuneration for acting in this capacity. Details of Board committees are set out on pages 34–38.

Employees

The work of Tearfund overseas and in the UK relies on the commitment and hard work of its valued staff. Communication links are maintained

the Board is very grateful for their commitment and contribution.

Internal control and risk management

The Trustee Directors have overall responsibility for Tearfund’s system of internal control. Such a system can provide only reasonable, and not absolute, assurance against errors or frauds. There is a clear delegation of the Trustee Directors’ authority through the Chief Executive to the rest of the organisation.

The Audit, Risk and Finance Committee, which meets four times a year, receives reports from the Head of Internal Audit, whose team works in accordance with an agreed plan based on an assessment of areas of greatest risk. The external auditor meets with the Committee twice a year.

Tearfund operates a comprehensive, rolling, three-year planning and budgeting process with an annual budget approved by the Board of Trustee Directors. Significant changes are subject to specific approval. A full re-forecast of the expected results is undertaken midway through the year, with additional forecasts prepared as required. The financial reporting systems provide monthly comparison of actual results against budget and forecast.

In 2019/20, the Trustee Directors approved a new Risk Management Policy for Tearfund that committed the organisation to implementing an organisation-wide risk management system, including comprehensive policy measures regarding roles and responsibilities, processes and culture. During 2020/21, key measures implemented were:

Ten were completed this year; fifteen more are planned for next year.

Tearfund maintains a comprehensive register which identifies the major strategic and operational corporatelevel risks and how they are being managed. The top ten are shown on page 44–45. The key risks are reviewed quarterly by the Executive team and by the Audit Risk and Finance Committee, who report key considerations to the Board. A full review by the Board is held as part of the annual threeyear planning process. The Trustee Directors are satisfied that systems are in place to monitor, manage and mitigate Tearfund’s exposure to major risks. They consider that maintaining Tearfund’s general reserves within the range stated on page 50, and reviewing internal controls and risks through an internal audit programme will provide Tearfund with adequate risk assurance and sufficient resources in the event of adverse conditions. They also recognise that the nature of some of Tearfund’s work requires active acceptance and management of some risks when undertaking activities to achieve the objectives of the charity.

Fraud is prevalent in many of the countries where Tearfund and its partners operate. As a result, Tearfund recognises fraud as one of the major risks that has to be managed. All potential frauds or other irregularities are required to be reported to the finance director, who chairs the Financial Wrongdoing Review team and maintains a register of the irregularities, actions taken and results. This register is reviewed regularly by the Audit, Risk and Finance Committee. Serious frauds are reported to the Charity Commission, including all frauds with a potential financial impact of £20,000 or more. Tearfund employs a full-time investigations and safeguarding manager to advise and coordinate prevention and response to fraud and other types of wrongdoing. Our approach to safeguarding is set out in detail on pages 40–41.

Remuneration

Tearfund’s pay policy seeks to balance our Christian values with the ability to attract and retain the best people in our sector. We do this by market reviews of our salary scales every two to three years. We draw data from a number of charity sector-specific pay surveys, including Birches Group,

Croner Reward and XpertHR. We are also members of a sector pay club. For the countries in which we operate, benchmark data is obtained for each country. In the UK this data is based on the following criteria:

Our latest full benchmarking exercise was completed in 2019. Under our current pay policy we aim to pay staff working outside the UK at the midpoint of market benchmark data. For staff working in the UK, we aim to pay between the 37.5th percentile and midpoint of the market benchmark data.

We take inflation into account by considering yearly increases based on available finances, consultation with the Staff Council and a survey of similar organisations in the sector. Tearfund’s Executive team is in the top grade of the UK salary structure. The Board sets the salary for the chief executive. Details regarding employees with emoluments above £60,000 can be found on page 67.

Health and safety

Tearfund has a Health and Safety Policy in place in respect of both UK and international operations, and the Board reviews Tearfund’s performance annually. A Health, Safety and Wellbeing Risk Register is maintained and reviewed every six months by a management committee.

Tearfund Scotland

We are required by the Office of the Scottish Charity Regulator to report separately upon the activities that Tearfund has undertaken in Scotland. These activities are led by a team based in Tearfund's Glasgow office. We receive funding from the Scottish government and Scottish trusts. We raise funds from individuals and other organisations throughout Scotland, and raise other support including campaigning and prayer support. Tearfund does not have grantmaking activity in Scotland.

34 . Annual Report and Financial Statements 2020/21

Board committees and their roles

Board committees and their roles

Annual Report and Financial Statements 2020/21 . 35

Safeguarding Committee

Tearfund is deeply committed to protecting and safeguarding everyone who comes into contact with our work, in whatever capacity – whether they are our partners or representatives, our staff or supporters or, most importantly, the communities which we serve.

The role of the Safeguarding Committee is to provide Board oversight of how Tearfund’s safeguarding culture develops, how cases are handled and how learning is embedded.

Our committee is made up of three trustees and members of Tearfund’s Safeguarding Review team. We support the Board in overseeing how Tearfund’s safeguarding policies and procedures are developed and implemented. An important aspect of our work is reviewing all reported safeguarding incidents across Tearfund globally and its partners: monitoring how investigations are managed, providing support and advice, identifying and mitigating risks, and reviewing learning and outcomes.

We scrutinise incidents, investigations and their outcomes, to ensure that we capture learning before cases are closed. We review cases on a quarterly basis but our committee chair and members also liaise with the Safeguarding Review team on an ad hoc basis, when required.

This year, the committee has overseen significant improvements in Tearfund’s practices around safer recruitment. We now undertake comprehensive international criminal record checks on all potential employees. Moreover, we also committed to collaborating with other international NGOs to prevent abusers moving between different agencies, by joining the Misconduct Disclosure Scheme in October 2020 (see Our Commitment to Safeguarding on page 40).

The committee continued to scrutinise the ongoing embedding of safeguarding risk assessments throughout Tearfund’s work. The safety and wellbeing of staff is of the utmost importance to us: to this end, we have a protocol to ensure that we provide the best possible support to any Tearfund staff or representative if they were to experience sexual assault or violence.

While we have made good progress over the last few years in strengthening policy, process and practice around safeguarding, we are far from complacent. A particular challenge arising during the Covid-19 pandemic has been a reduction in reporting of safeguarding cases, and the committee supported efforts to continue to encourage Tearfund staff and partners to report any concerns. The committee also reflected on learning points from the Parliamentary Select Committee on International Development’s report on sexual exploitation and abuse in the aid sector (see Our Commitment to Safeguarding on page 40).

We continue to build an organisational culture in which there is zero tolerance of abuse and exploitation and where the needs of survivors are given the highest priority.

Theology Committee

Tearfund seeks to be an organisation that follows Jesus where the need is greatest. It cares passionately that its work should be shaped by the Bible and serve as a signpost to the kingdom of God, enabling people to ‘live life to the full’ as God intended.

The Theology Committee serves to ensure that Tearfund's response to injustice and poverty reflects God's heart. Our role as a committee is to help the organisation gain an ever-deeper understanding of what it means to play a part in God’s plan to redeem and restore the world. Put simply, we exist to help Tearfund stay ‘on track’ with its biblical mandate. During the course of the year, the Theology Committee addressed the following issues:

Environmental and Economic Sustainability (EES): We continued to refine Tearfund’s ongoing theological research to strengthen this corporate priority. The committee affirmed Tearfund’s approach to this research. The research team actively consulted and engaged with leading thinkers, theologians and practitioners around the world, particularly those in the countries in which Tearfund works. As a result, Tearfund’s emerging and developing EES theology is richer and more robust, with a strong theological foundation. It will continue to shape Tearfund’s work in this area and influence wider theological thinking on related topics such as wealth creation and job creation.

Diversity and inclusion: The committee provided theological input on Tearfund’s pursuit in these vital areas. Together, we explored how our faith speaks to Tearfund’s commitment to nurture diversity and inclusion through our ministry among people in need, engagement with donors, churches and staff culture. It is our hope that these strong faith-foundations rooted in the word of God will enable Tearfund to be more inclusive in practical and meaningful ways.

Prosperity gospel: In some contexts where Tearfund works, this particular theology is influential and has been identified as an obstacle to Tearfund’s efforts to reach out to people living in poverty, through integral mission. We reflected on prosperity gospel theology from the perspective of Tearfund’s theological understanding of poverty, and explored how to equip and resource Tearfund staff to engage well with such beliefs in these contexts.

Inspired Individuals: We reviewed the theological underpinning developed for this wonderful and important aspect of Tearfund’s work with key influencers and changemakers. We explored what the Bible has to say about developing leaders to be kingdom catalysts in their local context.

Overarching all these individual focuses, we continued to explore what it means to be a Christian relief and development agency moulded by its faith, and transforming our world today.

Aksa lives in rural Tanzania, where a lack of rain had led to ongoing drought and failing harvests. She has now been introduced to a highly effective form of conservation farming through a Tearfund-supported initiative Photo: Tom Price/Tearfund

Fadi lost his leg during the Iraq conflict and now lives in a temporary camp Photo: Ruth Towell/Tearfund

36 . Annual Report and Financial Statements 2020/21

Board committees and their roles

Board committees and their roles

Annual Report and Financial Statements 2020/21 . 37

Global Fundraising and Communications Committee

Tearfund’s Global Advocacy and Influencing Group and our Global Fundraising Group are focused on inspiring, informing and helping supporters to live generously, following our ever-generous God.

The Global Fundraising and Communications Committee seeks to support, pray for and bring challenge into the work of these teams.

Tearfund is continuously looking to improve the ways we engage with our supporters. This was the first year of a new three-year strategy to grow a global community of supporters who want to enter into a whole-life response to poverty through prayer, giving, campaigning or volunteering in whatever capacity they can.

Throughout the year, our committee regularly reviewed activities and performance against this plan. We played an oversight role, bringing our expertise to envision, encourage and balance risk. We encouraged the teams always to trust our faithful God and we were continually amazed at their determination, innovation and agility, even in an increasingly challenging external environment.

Some of the things which we focused particularly on this year were:

New brand proposition: The launch of our new brand proposition ‘Poverty is not God’s plan. You are’ has been hugely successful. It is underpinned by a desire to clearly communicate our Christian distinctiveness and bring consistency to our communications.

The wider church family: We have begun work on improving our engagement and support in the wider UK church family. As we seek to partner with more UK churches in the coming years, we have been listening to friends in churches across the country, as we plan together to tackle poverty and injustice.

A switch to digital campaigning while maintaining a relational

approach to fundraising: The team has embraced the opportunities of digital campaigning with successful campaigns and events. We have also significantly enhanced our online and website capabilities this year. However, given our relational approach, it has been equally important for us to reach out to our supporters on the phone and by post. Both these channels have seen increasing engagement.

The worldwide Tearfund family: We continue to oversee investments Tearfund makes in Tearfund family organisations around the world, as well as the risks and challenges associated with sharing a global brand. The Tearfund family is a global network of 11 Christian relief and development agencies. There are independent, national Tearfund agencies in the UK, Ireland, Belgium, France, Germany, the Netherlands, Switzerland, Canada, the USA, Australia and New Zealand. It is a family with a common set of values and shared ways of working, united by God's call to reduce poverty and injustice in the world.

Tearfund’s fundraising and communications work is not without risk, particularly amid the challenges presented by Covid-19. We seek to balance this risk in a way that enables innovation and inspires our supporters, always remaining faithful to the core belief that ours is a ministry that invites all Christians to engage in God’s kingdom purposes – today and in the future.

International Impact Committee

Our purpose is to ensure a regular review of Tearfund’s corporate outcomes with a particular focus on the effectiveness, impact, distinctiveness and sustainability of the work being undertaken.

This matters because we always want to challenge ourselves to be learning and improving how we work, and ensuring we are focusing our efforts where we can achieve the best outcomes.

Over the last year, unsurprisingly, we have had sessions at every meeting to explore and understand how we have reacted to the pandemic, rapidly reshaping our portfolio of work with our partners to meet these new needs and make them locally relevant. We have learnt, again, the power and scope of our local church and community partnerships to reach the most vulnerable.

We have also begun to ensure that we focus on supporting recovery from the pandemic, which will certainly require a long-term commitment and focus. Tearfund’s distinctiveness in working with and through the local church is so powerful here: the church was there before Covid-19 struck, has been alongside communities throughout it, and will be there long after other agencies move on, staying put to heal the trauma and build sustainable recovery.

There have been other, more routine areas of the committee’s work too:

Catalyst: We have tracked how our catalytic model of working is maturing in some countries where churches are ready to operate more independently. This model helps mobilise the local church, NGOs and influencers to use their own local skills, knowledge and resources to bring about change. Instead of traditional partner funding, we spend our budgets on work to envision, equip, enable, organise and influence the church and others to address issues of poverty and injustice. This requires a patient and enabling mindset more akin to movementbuilding, and brings new challenges of measurement and evaluation.

Church and Community Transformation (CCT) scale-up: We have reviewed how our more established rural CCT work can be scaled up at country and denominational level. We have also considered how it can be adapted to fast-growth urban contexts – so vital in many African countries dominated by young and predominantly urban population centres.

Refocused advocacy: We have seen how our environmental advocacy work has been reshaped to reflect the postponement of the COP26 climate conference – and encouraged our teams to seize the opportunity to campaign for a greener economic recovery from the pandemic.

Fragile states: We have reviewed the lessons drawn from a strategic review of our peacebuilding work in fragile states after three years of experience and pilot studies, and have been delighted to see a distinctive niche opening up for our work in these difficult areas.

Risk appetite: Drawing on the expertise and wide experience of committee members, we have supported the Board to shape Tearfund’s risk appetite statements and ensure these are workable in diverse programmatic and geographic contexts.

Safety first: Importantly, we have continued to monitor the safety and security of our staff and partners overseas.

Mann Bahadur Gaha Magar is chairperson of the agricultural committee in a Nepalese village and is in charge of the maintenance of the irrigation channel Photo: Chris Hoskins/Tearfund

Noha stands on the roof of her home in Lebanon Photo: Ruth Towell/Tearfund

38 . Annual Report and Financial Statements 2020/21

Board committees and their roles

Quality Standards

Annual Report and Financial Statements 2020/21 . 39

Audit, Risk and Finance Committee

Tearfund seeks to make best use of the resources it has been blessed with and also recognises the paramount importance of showing supporters and wider stakeholders it is stewarding these resources well.

Against that background, our role as the Audit, Risk and Finance Committee remains to promote and ensure good governance, sound financial management, and disciplined risk taking, working closely with Tearfund management.

We have continued to address the four key priorities that we described last year: financial management, risk management, internal control and the IT systems programme. Highlights in relation to two of them include:

Financial management: The Covid-19 pandemic has required an increased focus on financial management, particularly given that the financial position at the start of the year meant that general reserves were below the Reserves Policy level. Early uncertainty around expected income, and increased challenges for us and our partners in the delivery of our programmes around the world, have been central to our discussions. The Board agreed a revised budget for 2020/21 in May 2020. During the year, we regularly reviewed financial performance and forecasts, and were encouraged by income holding up well and by the strengthening of the general reserves position. We have also reviewed and recommended to the Board:

Risk management: Tearfund continued developing a set of statements to articulate the Board’s appetite for risk. These statements were approved by the Board in December 2020 (see pages 44–45 for more details).

The importance of taking appropriate risks to achieve our purpose has heightened during the past year. A key part of the committee’s role remains helping the organisation get the balance right. To do this, we rely on the valuable contribution from our trustee and non-trustee members who collectively have considerable experience of governance, risk management, internal control, financial management, legal affairs and information technology.

Farid plays football in Lebanon at a training session organised by Tearfund’s partner Play for Peace, which brings together children from all backgrounds and teaches them about forgiveness, reconciliation and non-violence Photo: Ruth Towell/Tearfund

Quality Standards

Tearfund has established a set of corporate Quality Standards in support of our vision and the delivery of our strategy. These are in keeping with the organisational characteristics we aspire to and which summarise all of the relevant external and internal accountabilities, quality standards, codes, guidelines and principles to which we are committed.

Behaviours

Empowerment

We expect the highest behaviour standards across all of our work. We stand against all forms of exploitation, abuse, fraud, bribery and any other conduct that is incompatible with our values. We strive to transfer power to the people we serve, and to transform our own, our partners’ and communities’ attitudes and practices on inclusion, conflict sensitivity, accountability, gender and learning.

We are committed to community-led and participatory approaches to development and humanitarian response for sustainable impact that is based on root cause analysis. We encourage participation from all members of a community, and strive to support the people we work with to have agency in processes that affect their lives, ranging from local development activities through to local, national and regional advocacy.

Impartiality and targeting

Resilience

We are committed to impartiality, providing assistance to the most vulnerable people without regard for race, religion, ethnicity, ability, age, gender, sexuality or nationality. We target our work on the basis of need alone, while remaining sensitive to underlying causes of local tensions, and proactively work to support those who would otherwise be marginalised or excluded, in particular children, elderly people and those living with disability.

We are committed to helping people to understand, reduce and manage the risks they face, as well as to address the drivers of vulnerability. This includes supporting people and communities in developing resilient livelihoods, strengthening social cohesion, improving access to services, protecting environmental resources, reducing disaster risk and adapting to climate change.

Protection

Accountability

We are committed to restoring relationships and building safe and secure communities. We seek to prioritise the protection of all – especially children and the most marginalised and vulnerable adults – from physical, social and psychological harm. We will take steps to assess risks, including drivers of local conflict, to avoid any adverse effects of our work that might expose people to danger or lead to abuse. We believe that community members are the best actors in their own protection, and will support their actions to stay safe, find security and restore dignity.

We are committed to ensuring that all our work is based upon effective communication with, participation by and feedback from the communities we serve. It is important that all interventions are transparent and based upon continuous learning. We also hold ourselves accountable to our partners, donors, supporters and colleagues, and to all those with whom we relate and interact.

Gender

Technical quality

In all our programmes we actively seek to challenge gender inequality and harmful beliefs and practices, and work towards gender justice. We are committed to progressing gender equality and the restoration of relationships between men and women, boys and girls, and ensuring their equal value, participation and decision-making in all aspects of life.

We are committed to the high technical quality of all of our work, and the work of partners, through meeting relevant national and international standards aligned with communities’ own priorities. We will continuously learn to improve, and will identify and replicate good practice that is demonstrated to have relevant and positive impact.

As part of Tearfund’s commitment to Quality Standards, we are pleased to have been awarded the Core Humanitarian Standard (CHS) since 2016.

The CHS provides assurance that Tearfund is following the highest standards within the sector to improve the quality, accountability and effectiveness of our response, and makes sure the people we serve are kept at the centre of all our work.

40 . Annual Report and Financial Statements 2020/21

Our commitment to safeguarding

Our commitment to safeguarding

Annual Report and Financial Statements 2020/21 . 41

Our commitment to safeguarding

We are deeply committed to following Jesus’ example in treating everyone with care and respect, and building a world where healthy relationships are restored and where violence, harassment and abuse are not tolerated.

It is of paramount importance to us that we safeguard and protect all our partners, representatives, staff, supporters and, above all, some of the world’s most vulnerable people in the communities we serve.

We have also joined the sector’s Misconduct Disclosure Scheme which enables participating agencies to ask for a detailed conduct statement for potential recruits in relation to sexual abuse or harassment misconduct in previous posts. We are committed to responding to such checks about former Tearfund employees.

compliance with the Core Humanitarian Standard on Quality and Accountability (CHS) was independently certified by the Humanitarian Quality Assurance Initiative (HQAI) in August 2020.

We note the findings of the Parliamentary Select Committee on International Development’s progress report on sexual abuse and exploitation in the aid sector, which was published in January 2021. We highlight our commitment to key points raised in that report: community awareness of the standards of behaviour they should expect, ensuring that reporting mechanisms work well at community level, strengthening investigation capacity (particularly with partners), supporting survivors, and increasing the representation of women and ethnic minorities in leadership positions.

Safeguarding policies and procedures We have in place a robust suite of policies and procedures aimed at preventing abuse and harm. In line with the Charity Commission’s expectations, we review and update our Safeguarding Policy annually. We also regularly revisit our Whistleblowing and Personal Conduct policies in accordance with our review schedule.

We actively encourage our staff, representatives and members of communities in which we work to report safeguarding concerns and incidents when they occur, as well as to report any allegations of historic incidents they may become aware of. We have a number of mechanisms in place to ensure concerns and incidents can be safely reported, including a dedicated confidential safeguarding and whistleblowing email account and an independently administered 24/7 whistleblowing hotline, Safecall, with the option to report in more than 100 languages. These mechanisms are advertised through posters (displayed in our offices, our partners’ offices and Tearfund projects), communication updates, training events and the ‘Safeguarding and reporting concerns’ page on our website. We have improved access to safeguardingincident reporting for staff by including a link on our Corporate Hub.

We are committed to training our staff, representatives and partners on safeguarding good practice. Each year all staff and Trustee Directors are required to complete our mandatory e-learning on safeguarding children and adults-at-risk. The training is updated annually to take into account learning from past incidents and emerging best practice in the sector. Our network of country, cluster and directorate ‘safeguarding focal points’ have received additional in-depth training during 2020/21. We have an ongoing programme to ensure that all partners with whom we work receive training and embed good safeguarding practice into their organisations. We continue to review safeguarding practice through our compliance and internal audit functions.

Supporting survivors

We take a ‘survivor-centred’ approach to safeguarding and will work sensitively with the survivor to ensure that, whenever possible, their wellbeing and interests are prioritised. We continue to review our processes of support to ensure we follow best practice in the sector. Our internal safeguarding training courses emphasise to all staff the importance of placing the needs and wishes of the survivor at the heart of our response to incidents. Whenever possible and if they are willing, we will seek feedback from survivors in relation to how they have been treated in order to improve how we respond to incidents and support those involved.

We also recognise that members of communities we work with may not wish to use emails or phone lines to report incidents. We are committed to developing practices with our staff and partners to involve communities in the design of all feedback mechanisms and protective measures, as well as communicating the standards of behaviour they can expect. This work goes hand in hand with Tearfund’s Quality Standards.

We seek to deploy safer recruitment practices in line with best practice in the sector: we carry out enhanced Disclosure and Barring Service (DBS) checks to ensure that all relevant staff and representatives are securely vetted and safely recruited to work with children and vulnerable adults. We have strengthened our preemployment checks for non-UK citizens by procuring the services of a thirdparty provider, Sterling, to provide international criminal record checks.

Handling complaints and concerns

In accordance with our case management process, all safeguarding complaints and concerns are reviewed initially by our Investigations and Safeguarding Manager and then by the full Safeguarding Review team. This team is formed of key senior staff from across the organisation. Our Board Safeguarding

Tearfund received an external endorsement of the health of our safeguarding culture in the form of Keeping Children Safe Level 1 certification in 2020. In addition, our

Committee also provides invaluable • four cases involved Tearfund oversight, advice and scrutiny of members of staff or representatives safeguarding cases (see page 34).

The number of cases received during this year is less than the previous year. The Covid-19 pandemic has impacted communities' access to Tearfund staff and our partners, and we believe this is the underlying reason for the reduced reporting rates. To try and address this issue we have communicated with staff and partners, reminding them of the importance of reporting and the key safeguarding issues to be aware of. When travel is possible we will engage in face-to-face conversations with communities to highlight what constitutes unacceptable behaviour and to encourage reporting.

Assessment of safeguarding risks

We continue to improve and strengthen our approach to assessing our projects, programmes, activities and events for potential safeguarding risks, and develop appropriate measures to mitigate them. We continue to implement a standardised risk assessment framework which helps staff and partners carry out risk assessments in a methodical and consistent way.

Child safeguarding

Four of the 24 cases investigated related to the safeguarding of a child and involved either a Tearfund member of staff or representative, or a member of partner staff. Two cases involved the sexual abuse of a child by a member of partner staff. We worked with the partners to improve their policies and practice. Both of the cases have been closed. In all substantiated cases the perpetrators were dealt with appropriately by Tearfund, the partner and/or local authorities. The needs of the survivors were prioritised and appropriate support offered. Tearfund’s partners were encouraged and supported to offer similar support to survivors. In addition, the alleged perpetrators were given the opportunity to ask for support during the investigation process.

Tearfund has developed a Safeguarding Risk Appetite Statement which allows us to categorise risk in a measured and consistent manner. The categorisation of risk guides our policy, process and practice. Safeguarding risk is also included in our Corporate Risk Register.

During the year, the pandemic has required us to move to online events to engage with our supporters. We have developed an online events safeguarding risk assessment tool to ensure that everyone involved in these events can participate safely and enjoy the online experience.

Adult safeguarding

Eight of the 24 cases investigated this year related to the safeguarding of adults-at-risk and involved either a Tearfund member of staff or representative, or a member of partner staff. Three of the cases were investigated and closed; five cases remain ongoing. Of the three closed cases, two involved allegations of sexual abuse, exploitation and harassment by a member of partner staff towards another partner staff member. Tearfund followed up the cases with the partners and offered support as appropriate. The remaining closed case involved a member of the

2020/21 Review of cases

We work in more than 50 countries through 227 partners and have reached 2.4 million people through our response to disasters and 1.4 million people through our community development work this financial year. In this period, we received 16 cases through our safeguarding channels. We investigated and closed 19 cases which included seven cases carried forward from 2019/20 and one case from 2018/19; five cases remain open investigations at the year end. Of the 24 cases dealt with during the year:

community and a member of partner staff. This case was investigated by the partner and appropriate action was taken against the staff member. We proactively encouraged and supported our partners to consider and meet the support needs of survivors.

Lessons learnt

We are committed to improving our safeguarding continually. In 2020/21 we implemented a number of actions to address safeguarding learning points we had identified. These included:

42 . Annual Report and Financial Statements 2020/21

Diversity and inclusion report

Diversity and inclusion report

We want Tearfund to be a place where everyone feels welcome, respected, valued and treated fairly: where everyone feels they belong.

Our aim is to see everyone we work with flourishing, reaching their God-given potential and living life with dignity. We are committed to ensuring diversity and inclusion remain at the heart of Tearfund’s work, both internally and externally.

the organisation. The Diversity and Inclusion Committee will be working with operational teams to set and oversee recruitment targets during the next financial year as we seek to improve diversity in our workforce as part of our commitment to creating an inclusive culture at Tearfund.

The Board has taken steps to seek a more diverse range of candidates as they recruit new trustees, taking into account race and ethnicity, gender, age, disability and also socioeconomic background. This includes the recruitment of a trustee from the majority world to the Theology Committee, and another to the International Impact Committee, and there are plans to recruit a trustee who is a leader within a Black Majority Church in the UK.

Alongside this, we have continued to work across human resources, staff and leadership development, theology, communications, advocacy and programming, reviewing our policies and practices as we pursue diversity and inclusion for everyone.

A watershed moment

2020 was a pivotal year in recognising the continuing impact of racial injustice across the world. Racism causes broken relationships, and broken relationships keep people trapped in cycles of poverty.

Disability inclusion

As an organisation, we have stood in solidarity with Black people and other people of colour who continue to experience discrimination and oppression because of their race and ethnicity. These are some of the practical steps we have taken this year:

We are committed to equality, diversity and inclusion in the recruitment, training, promotion and career development of people living with a disability.

As part of its commitment to having the right mix of knowledge, skills and experience in order to be effective, the Board will be undertaking an updated skills and diversity assessment. The purpose is to identify any gaps, so they can be addressed in succession planning. Further diversity and inclusion training will be conducted with the Board during the coming financial year.

Recruitment

Tearfund’s Recruitment and Equal Opportunities policies are reviewed regularly. They state that all candidates will be treated fairly, with dignity and respect.

Recognising that we have more to do across all areas of diversity and inclusion, the Board made the timely decision to establish a Diversity and Inclusion Committee for an initial period of two years. Its aim is to create greater accountability structures and demonstrate an ongoing commitment to ensuring Tearfund is a diverse and inclusive organisation. The Chair is working with the Head of Diversity and Inclusion and the Global Recruitment Manager to examine Board recruitment processes to ensure they are free from bias and also support the recruitment and selection of more diverse Board members.

• The recruitment team ask all shortlisted candidates if they need any reasonable adjustments to be made for their interview, presentation and/or assessment (where applicable).

The Board continues to support the operational diversity and inclusion work taking place across

Employment

Tearfund’s current Equal Opportunities Policy states that it applies to all aspects of employment with us, including recruitment, pay and conditions, training, appraisals, promotion, conduct at work, disciplinary and grievance procedures, and termination of employment.

The policy says that if people are living with a disability we encourage them to tell us about their condition so that we can consider what reasonable adjustments or support may be appropriate.

Tearfund aims to ensure that people with disabilities are given equal opportunity to obtain employment. In doing so, we will fully consider making reasonable adjustments to working practices, equipment and premises to ensure that a person living with a disability is not put at a substantial disadvantage due to their disability. Should staff become disabled in the course of their employment, every effort will be made through reasonable adjustment, retraining or redeployment to enable them to remain in the employment.

If a staff member or a candidate feels that they have been unfairly discriminated against, they may raise a complaint under Tearfund’s Equal Opportunities Policy.

A member of the local community gathering fresh, clean water in Afar, northeast Ethiopia, where Tearfund are working with Friendship Support Association (FSA) to set up solar-powered wells that will provide clean water to local villages Photo: Chris Hoskins/Tearfund

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Annual Report and Financial Statements 2020/21 . 43
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44 . Annual Report and Financial Statements 2020/21

Risk management framework

Risk management framework

Annual Report and Financial Statements 2020/21 . 45

Risk management framework

The Trustee Directors have identified the most important potential risks and uncertainties that may seriously affect the performance, future prospects or reputation of Tearfund, and how they will be mitigated.

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Identified risk Mitigation
Christian distinctiveness: • distinctively Christian guiding documents: Vision, Mission, Values,
actual or perceived loss of our Characteristics, Theory of Poverty, and Statement of Faith
core Christian identity or ways • priority given to working through local church partners wherever possible
of working
• brand guidelines for fundraising and supporter communications
• prayer, worship and devotions central to working practice
• appointment process for trustees, key staff and other representatives includes
exploration of Christian identity
• Board Theology Committee
Safety, security, health & • policies and procedures for Safety and Security, and for Health, Safety and
wellbeing: wellbeing
loss of life, health, safety or • security training for all international staff and those who travel
wellbeing of staff, volunteers or
• country Safety and Security Plans
others under our duty of care
• emergency Response and Crisis Response Plans documented and tested
• pastoral and wellbeing care structures; ‘all staff’ communications highlighting
wellbeing; awareness and resources
• dedicated Safety and Security team, and regional safety and security advisers
• Board and management committees review risks and mitigations
Safeguarding: • policies on Safeguarding, Personal Conduct, and Whistleblowing: regularly
abuse or other harm of a child reviewed and communicated
or adult-at-risk • mandatory annual staff training on safeguarding and whistleblowing
• independent reporting hotline publicised to staff, partners and communities
• safeguarding manager and network of trained safeguarding focal points
• minimum standards for partner safeguarding policies
• Board Safeguarding Committee reviews all incidents and directs continuous
improvement of policy and practice
• introducing safeguarding risk assessments on all partner projects and all areas
of Tearfund operations
• safer recruitment practices, including background checks, references and
interview questions
Major programmes: • programme Funding and Support team
failure to deliver on key outcomes • programme Design Approval process
of a high-profile donor-funded • monthly reviews by region of progress made on donor-grant spending
project • finance manager and grants officer roles in all country offices that receive
donor funding
• partner capacity assessments are used to identify suitable partners to receive
donor funding
Funding: • reserves policy and position reviewed regularly
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Funding:

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Identified risk Mitigation
Impact: • Board International Impact Committee (see page 37)
not measuring or demonstrating • dedicated Impact and Effectiveness team, and regional/country office roles
impact in our work adequately
• design, monitoring and evaluation system used for all projects and programmes
• corporate and country strategy processes used to align work and outcomes
with corporate priorities and impact objectives
• annual business plan includes a section on impact and evidence
• corporate scorecard reviewed quarterly by Executive team and Board
Sanctions and terrorism: • policy and procedure on Financial Sanctions, Anti-Money Laundering, and
our funds are used by a Anti-Terrorism
sanctioned party, or for • enhanced due diligence procedures for high terror-risk countries
the purposes of terrorism
• partners are required to make their staff aware of risks of financing terrorism,
and report incidents
• partner capacity assessments cover policies and training on countering terrorism
IT security: • policies on Data Protection and Information Security
inadequate cybersecurity and/or • mandatory annual staff training on data protection and cybersecurity
protection of personal data
• real-time back-ups of all core systems held in secure off-site data centre,
including cold storage of core databases
• Data protection officer appointed and trained
Financial wrongdoing: • policies on Fraud, Bribery, Corruption, and Conflicts of Interest
corruption, fraud, bribery or • mandatory annual staff training on fraud awareness, anti-bribery and
conflict of interest involving corruption, conflicts of interest, and whistleblowing
our staff or partners
• partner capacity assessments and plans for building up learning and knowledge
cover policies and training on fraud and bribery, conflicts of interest, and
whistleblowing
• Financial Wrongdoing Review team coordinates response to all incidents;
Executive team and Board Audit, Risk and Finance Committee review all cases
before closure
• monitoring of partner projects and financial reports, backed up by Tearfund audits
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Environmental impact:

46 . Annual Report and Financial Statements 2020/21

Environmental performance report

Greenhouse gas emissions and energy use data

Annual Report and Financial Statements 2020/21 . 47

Environmental performance report

The climate crisis is having a devastating impact around the world, causing ever more extreme and intense hazards.

We want to see people released from extreme poverty, and recognise that many are trapped because they live in places affected by environmental degradation and climate change.

Tackling climate change is therefore an essential part of our mission to see an end to extreme poverty. This is why Environmental and Economic Sustainability (EES) is one of our three corporate priorities – and why this year we’ve established projects that have a positive environmental impact in the areas of waste management, renewable energy and climate-smart agriculture. Integral to this focus is a commitment to improving our own environmental performance.

Our Environmental Policy commits us to reducing our greenhouse gas emissions across the following activities: transport, electricity, water, gas and paper. We have already taken many steps in recent years to improve our environmental performance and will continue to focus on ways we can make improvements across both our internal and external operations. This year, these steps have included:

The past year has been a turbulent one. We have had to learn how to adapt to remote ways of working while maintaining business as usual. We have moved training, meetings, workshops and conferences online, some of which have come with logistical and connectivity challenges.

Emissions during this period have been significantly lower than previous years due to travel restrictions and office closures. The dramatic increase in homeworking globally means that some emissions such as electricity and gas have been relocated to employees’ homes. The pandemic has provided an opportunity to review our practices and reconsider some of our activities, especially those related to air travel. We have learnt to adapt to more digital ways of working and will continue with some of these practices into the future.

One of our main challenges continues to be tracking our emissions and environmental impact across all the countries where we work, due to the sheer complexity of the task and needing to have systems in place to make this possible. We remain encouraged, though, by our staff's understanding and commitment to environmental matters.

Greenhouse gas emissions and energy use data for Tearfund UK

for the period of 1 April 2020 to 31 March 2021

We know that environmental issues are hitting people living in poverty the hardest, which is why environmental sustainability is not a new area for Tearfund. We have a long history of working on environmental issues where they impact on poor communities around the world.

We have followed the Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance (2019), and Government emission conversion factors for greenhouse gas company reporting (2020) to produce these figures relating to our carbon footprint in the UK:

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2020–21 2019–20
Energy consumption used to calculate emissions kWh kWh
Gas 60,000 75,000
Electricity 292,000 358,000
Transport fuel 5,000 3,000
Total 357,000 436,000
Emission sources Tonnes of CO2e Tonnes of CO2e
Combustion of gas (Scope 1) 11.0 17.3
Combustion of fuel for transport purposes (Scope 1) 0.1 1.1
Business travel in rental cars or employee-owned vehicles where
1.5 13.6
company is responsible for purchasing the fuel (Scope 3)
Purchased electricity (Scope 2 location-based) 72.4 99.3
Total gross based on above 85.0 131.3
Intensity ratio: tonnes of CO2e per full-time equivalents 0.2 0.3
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Energy efficiency action

Emissions during this period are lower than previous years due to the impact of the Covid-19 pandemic. Limited office access over this past year and travel restrictions have resulted in a decrease in office energy and fuel consumption. An error was identified in the gas calculation for 2019/20: it included both the net and gross CV (calorific value) amounts. This has now been amended to account for the gross CV amount only.

48 . Annual Report and Financial Statements 2020/21

Annual Report and Financial Statements 2020/21 . 49

Trustees, Members & Ambassadors

Trustees, Members & Ambassadors

Trustee Directors, Committee Members, Other Members, Ambassadors and Executive team

Board of Trustee Directors

Committee members

International Impact Committee

Sally Jones-Evans (Chair) Joanna de Berry (from May 2020) Ian Curtis

The Board of Trustee Directors is responsible for ultimate strategic decisions and is appointed by the Members at the Annual General Meeting (AGM). The Board of Trustee Directors who were in office during the year and up to the date of signing were:

Details up to 31 March 2021. The Board recruits individuals with specific expertise to sit on sub-committees of the Board:

Fi McLachlan

Audit, Risk and Finance Committee

Jean Paul Ndagijimana (from March 2021) Adam Taylor

John Shaw (Chair)

Anna Laszlo[1] (Chair)

Antony Barnes (from February 2021) Anna Beck (from February 2021)

Fletcher Tembo (from November 2020) Rosemary Nuamah Williams

Philip Loney (Deputy Chair and Trustee Director until September 2020) Stephanie Biden (Deputy Chair from October 2020)

Stephanie Biden

Safeguarding Committee

Steve Foster

Stephanie Biden (Chair) Ian Curtis

Antony Barnes (from February 2021) Jayakumar Christian (from September 2020)

Robert Hardy (from February 2021) Joseph Kariuki (from February 2021) Philip Loney (until September 2020) Gordon McKechnie

John Davidson

Ian Curtis

Rosemary Nuamah Williams (until September 2020)

John Davidson (also member of Tearfund USA Board)

Rosie Slater-Carr (from February 2021) Michael Stewart (until September 2020) Mark Thompson (until September 2020)

Theology Committee

Stephanie Heald (until September 2020)

Jayakumar Christian (Chair from September 2020)

Sally Jones-Evans

Rev Mark Melluish (until September 2020) Rt Rev Harold Miller

Diversity and Inclusion Committee

Stafford Carson

This committee was formed on 7 June 2021 and all members joined on this date.

Rosalee Ewell

Jean Paul Ndagijimana (from March 2021)

Jim Ingram

Rosemary Nuamah Williams

Rev Mark Melluish (until September 2020) Rt Rev Harold Miller Dr Elaine Storkey

Anna Laszlo (Chair)

Harry Phinda John Shaw (Treasurer) David Wesson

Stephanie Biden

Harry Phinda

Members of the Council

Global Fundraising and Communications Committee

In addition to all of the Board of Trustee Directors, the following people are also Members of the Charity. The Members of the Charity are referred to as Members of the Council:

David Wesson (Chair)

Hilary Croft

John Davidson

Mark Andrews

Stephanie Heald (until September 2020) Rev Mark Melluish (until September 2020) Harry Phinda Simon Poole

Robert Camp

Gary Carpenter Steve Clifford

Dr Elizabeth Corrie

Wales

Graham Fairbairn Paul German Richard Gough Kim Hurst

Mark Andrews (Chair) Rev Simeon Baker

Andy Bull

Ambassadors

Anne de Leyser Rev Iain Macaulay (until October 2020) Fiona Major Deepak Mahtani (passed away April 2020) Clive Mather Gordon McKechnie Philip McMillan Julia Ogilvy Rt Rev Anthony Poggo Michael Stewart Mark Thompson Rev Dr Chris Wright

Rev Celia Apeagyei-Collins Peter Chambers Anne Coles

Rev John Coles Martha Collison

Liz Earle Rev Elfed Godding Pete Greig Tamsin Greig Bear Grylls Guvna B

David Gyasi

National Advisory Committee members

Lord Michael Hastings Tom Herbert

Northern Ireland

Dr Krish Kandiah

Phillip McMillan (Chair) Paul Coulter

Rev Siew-Huat Ong

Rob Parsons

Denise Hayward Susie McCollough

Ruan Pienaar

Dame Caroline Spelman DBE Rt Rev Ric Thorpe Rt Hon Stephen Timms MP Will Torrent

Scotland

Rev Iain Macaulay (Chair until September 2020) Carolyn Finlayson (Acting Chair from September 2020) Richard Atkinson

Jill Brown (until March 2021)

Jenny Honey Rev David McCarthy Fiona Morrison Ellyn Oliver

Executive team

The Board has delegated day-to-day operational decisions to the Executive team:

Nigel Harris

Chief Executive

Karen Brown

Director of People and Talent

Catriona Dejean

Director of Strategy and Impact

Nigel Gavin

Director of Finance and IT

Myles Harrison International Director

Jane Pleace

Global Fundraising Director

Dr Ruth Valerio Global Advocacy and Influencing Director

Independent auditors BDO LLP

55 Baker Street, London W1U 7EU

Solicitors

Anthony Collins Solicitors LLP 134 Edmund Street, Birmingham B3 2ES

Bankers

Barclays Bank UK plc

1 Churchill Place, London E14 5HP

Registered office

100 Church Road, Teddington TW11 8QE

1 – Ex-officio on all Committees, except the Audit, Risk and Finance Committee

Photos: Chris Hoskins/Tearfund (Martha Collinson and Will Torrent), Will Boase/Tearfund (Liz Earle), Marc Gilgen/Tearfund (Krish Kandiah)

50 . Annual Report and Financial Statements 2020/21

Financial review

Financial review

Annual Report and Financial Statements 2020/21 . 51

Financial review

Income and expenditure

Tearfund’s total income for 2020/21 was £81.4m (2019/20: £85.1m), a very encouraging result considering the pandemic caused the cancellation of all face-to-face fundraising events during the year. This is a tribute both to the agility of our fundraising teams who switched rapidly to online events and programmes (see pages 24–29) as well as to the generosity of our supporters. It is all the more striking when we remember that 2019/20 income included a very generous donation from an individual supporter. Income from institutional grants (£26.1m) and legacies (£5.5m) were broadly unchanged compared to 2019/20, while emergency appeals income (excluding DEC funds) increased from £2.0m to £4.3m, mainly as a result of the appeal to fund our emergency response to the impacts of Covid-19 across the world.

The consolidated results include the operations of Tearfund Trading Limited (TTL), which is a wholly-owned subsidiary of Tearfund. The income generated from TTL is from a variety of sources including Toilet Twinning products and Christmas card sales.

Total expenditure decreased by 8.7% to £77.8m (2019/20: £85.2m) due to the effects of global lockdowns on programming activities and the implementation of cost reductions to mitigate potential income impacts arising from the economic consequences of the pandemic. This resulted in net income for the year of £3.6m, of which £2.1m represents a surplus on unrestricted funds. This includes a surplus on the general fund of £5.7m (offset by expenditure against the designated Strategic Priorities fund and depreciation of fixed assets).

Grants

A large part of Tearfund’s work to address poverty is undertaken through making grants to partner organisations. Grants are made in the context of agreed country strategies. Project proposals received from partner organisations are subject to a formal approval process that includes a technical assessment of the project and a review of the organisation’s capacity and compliance policies.

An agreed monitoring process is undertaken during the life cycle of all projects. In addition, financial evaluations are carried out on all large projects and on a sample of smaller projects. Details of grants made to the top 50 partner organisations are on our website at www.tearfund.org/top50

General funds

General funds are needed to:

The Board of Trustee Directors reviews the level of required general funds annually to ensure that an appropriate level is held. The review takes into account the main financial risks of our operating model and environment in respect of all income streams and categories of expenditure. The target range to cover these risks in addition to routine working capital is set at between £7.0m and £10.0m for 2021/22, a significant increase from the previous range of between £4.5m and £6.5m. The increase represents a deliberate strategy of strengthening our reserves as well as reflecting a more cautious approach to our organisational risk profile in light of the Covid-19 pandemic, particularly in relation to uncertainty around unrestricted income. Our reserves policy also includes a new provision, which we have not needed to use this year, that allows up to £3m of the value of the freehold office building (owned by Tearfund) to count towards the funding of reserves. This is considered appropriate, as Tearfund has access to additional liquidity by means of a £6m credit facility, secured against the building.

At the end of 2020/21 our general fund stands at £9.6m (2019/20: £3.9m), which is at the upper end of the target range. This is a stronger than expected position, attributable to the robustness of our unrestricted income streams and cost savings achieved during 2020/21, together with high donations and legacy income during the last quarter of the financial year. It will enable us to direct additional investment in 2021/22 towards our priority areas of Church and Community Transformation, Environmental and Economic Sustainability, and Fragile States, as well as responding to the global impacts of the pandemic and to other emergencies, such as the wide-ranging consequences of the volcanic eruption in the Democratic Republic of Congo.

The going concern note on page 60 gives further details.

Designated funds

Designated funds are part of the unrestricted funds which the Trustee Directors have earmarked for a particular use, without restricting or committing the funds legally. The Fixed Asset Fund represents the net book value of Tearfund’s fixed assets, including the purchase of Toilet Twinning, to indicate that these resources are not available for other purposes. At the end of the year, the Fixed Asset Fund stood at £1.6m (2019/20: £2.5m).

The Overseas Assets Fund at the end of the year showed a positive balance of £0.1m (2019/20: deficit of £0.1m). This fund is used for the replacement of vehicles in our overseas locations and for the provision of renewable energy solutions in disaster responses.

The Strategic Priorities Fund enables Tearfund to run a series of projects over three years in 12 countries focusing on environmental and economic sustainability (including waste and renewable energy projects), together with investment in improved information systems and in leadership and management development and training. The balance remaining on this fund at the end of the year is £5.5m (2019/20: £8.5m).

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Restricted funds
Restricted funds are funds subject to
specific conditions imposed by donors. Where your money goes
The year-end balances represent income
which has been recorded but where the
related expenditure has not yet been
incurred. The majority of these funds Churches
are either institutional awards, or funds mobilised
11p 10p
generated during emergencies or as a
result of other specific appeals. In many Emergency
cases these appeals generate income needs met
11p
over a short timeframe which is then
planned to be spent over a period of up 37p Communities
to three years in line with the purpose transformed
of the appeal. At the end of the year, 9p 34p
total restricted funds had increased Society
changed
to £12.8m (2019/20: £11.3m). For each
fund, Tearfund’s assets are available
and adequate to fulfil its obligations. Fundraising
25p
Financial risk management
Over the past year we identified a Support and running costs
key financial risk as the anticipated
impacts on Tearfund income arising
from the economic consequences of
the pandemic. We mitigated this risk
through the support and generosity of
major donors, weekly tracking of income
and enhanced cost control measures.
One Pound
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Income
£1m
£5.4m
General donations £48.9m
Government grants £26.1m
Emergency appeals £5.4m
£26.1m Total income Other income £1.0m
£81.4m
Total income £81.4m
£48.9m
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Receivables relate mainly to major governmental and institutional donors. The associated credit risk is considered to be low, as is the risk of disallowances arising from donor audits. This is borne out by recent experience. Cash flow and liquidity risks are minimised by a conservative investment policy and by a £6m credit facility, which is in place but unused to date. Appropriate action is taken to mitigate foreign exchange risk. Tearfund does not enter into foreign exchange contracts for speculative reasons.

Investment policy and performance

Tearfund’s investment policy is reviewed annually by the Audit, Risk and Finance Committee. Our objective is to maintain high liquidity while ensuring maximum security. To achieve this, Tearfund invests with institutions with a high security rating in fixed-term or call deposits. During the year Tearfund’s sterling deposits achieved an average rate of interest of 0.37% (2019/20: 0.81%) compared with an average bank base rate for the same period of 0.10% (2019/20: 0.72%).

Trustee Director’s responsibility statement

Annual Report and Financial Statements 2020/21 . 53

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52 . Annual Report and Financial Statements 2020/21
Rani Sara Rana cooks rice on her fuel efficient
stove in a village near Nawalparasi, Nepal
Photo: Chris Hoskins/Tearfund
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Trustee Directors’ responsibility statement

Trustee Directors’ responsibilities

Financial statements are published on the charity’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the charity’s website is the responsibility of the trustees. The trustees’ responsibility also extends to the ongoing integrity of the financial statements contained therein.

The Trustee Directors are responsible for preparing the Strategic Report, the Trustee Directors’ Report/Annual Report and the financial statements in accordance with applicable law and regulations. Company law requires the Trustee Directors to prepare financial statements for each financial year. Under that law the Trustee Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the Trustee Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the net income or expenditure of the company for that period.

Disclosure of information to auditors In the case of each of the persons who are Trustee Directors of the company at the date when this report was approved:

In preparing these financial statements, the Trustee Directors are required to:

This confirmation is given and should be interpreted in accordance with the provisions of S418 of the Companies Act 2006.

Trustee Directors’ Report approved by the Board and signed on its behalf by:

The Trustee Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Anna Laszlo

Chair

14 July 2021

54 . Annual Report and Financial Statements 2020/21

Independent auditor’s report

Independent auditor’s report

Annual Report and Financial Statements 2020/21 . 55

Independent auditor’s report to the trustees and members of Tearfund

Opinion on the financial statements In our opinion, the financial statements:

We have audited the financial statements of Tearfund (“the Parent Charitable Company”) and its subsidiaries (“the Group”) for the year ended 31 March 2021 which comprise the consolidated statement of financial activities, the consolidated statement of financial position, the consolidated cash flow statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

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 Group and the Parent Charitable Company in accordance with the

ethical requirements 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 related to going concern

In auditing the financial statements, we have concluded that the Trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group and the Parent Charitable Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The Trustees are responsible for the other information. The other information comprises the information included in the Annual Report & Accounts, other than the financial statements and our auditor’s report thereon. The other information comprises: Sharing the bread of life, Chair’s Introduction, CEO’s introduction and the Trustee Directors’ Report (incorporating the Strategic Report). Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or

otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Other Companies Act 2006 reporting

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the Trustees’ Report, which includes the Directors’ Report and the Strategic report prepared for the purposes of Company Law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and

In the light of the knowledge and understanding of the Group and the Parent Charitable Company and its environment obtained in the course of the audit, we have not identified material misstatement in the Strategic report or the Trustee’s report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities and Trustee Investment (Scotland) Act 2005 requires us to report to you if, in our opinion;

Responsibilities of Trustees

As explained more fully in the Statement of Trustees’ responsibilities, 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 determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the Group’s and the Parent Charitable Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the Group or the Parent Charitable Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements We have been appointed as auditor under section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and under the Companies Act 2006 and report in accordance with the Acts and relevant regulations made or having effect thereunder.

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.

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

As part of the audit we gained an understanding of the legal and regulatory framework applicable to the Group and the sector in which it operates, and considered the risk of acts by the Group that were contrary to applicable laws and regulations, including fraud. We considered the Group’s own assessment of the risks that irregularities may occur either as a result of fraud or error, the Group’s compliance with laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006, the Charities Act 2011, Charities and Trustee Investment (Scotland) Act 2005 and other laws and regulations applicable to the group such as employment law, taxation legislation, data protection and health and safety legislation. We considered financial performance, key performance indicators and other performance targets. We also considered the risks of non-compliance with requirements imposed by the Charity Commission, and other regulators, and we considered the extent to which non-compliance might have a material effect on the group financial statements.

We also communicated relevant identified laws and regulations, potential fraud risks and that there were no known matters of significant non-compliance with laws and regulations, to all engagement team members including internal specialists audit teams, and remained alert to any

indications of fraud or non-compliance with laws and regulations throughout the audit.

As a result of these procedures we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: donations, grants and legacy revenue recognition, supplier and overseas grant payments.

Our tests included:

56 . Annual Report and Financial Statements 2020/21

Independent auditor’s report

Financial statements

Annual Report and Financial Statements 2020/21 . 57

Consolidated Statements of Financial Activities

(incorporating an income and expenditure account) Year ended 31 March 2021

• performing audit procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud.

As in all of our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluations, whether there was evidence of bias in accounting estimates by management or the Board that represented a risk of material misstatement due to fraud.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (“FRC’s”) website at:

www.frc.org.uk/auditorsresponsibilities This description forms part of our auditor’s report.

Use of our report

This report is made solely to the Charitable Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, and to the Charitable Company’s trustees, as a body, in accordance with the Charities and Trustee Investment (Scotland) Act 2005. Our audit work has been undertaken so that we might state to the Charitable Company’s members and 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 Charitable Company, the Charitable Company’s members as a body and the Charitable Company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Jill Halford

(Senior Statutory Auditor) For and on behalf of BDO LLP, statutory auditor London, UK

21 July 2021

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

----- Start of picture text -----
2021 2020
Unrestricted Restricted Total Unrestricted Restricted Total
funds funds funds funds funds funds
Note £’000 £’000 £’000 £’000 £’000 £’000
Income from:
Donations and legacies 2a 33,242 47,174 80,416 38,091 45,525 83,616
Charitable activities 3 836 1 837 1,122 69 1,191
Other trading activities 5 15 39 54 27 78 105
Investment income 60 - 60 100 45 145
Total income 34,153 47,214 81,367 39,340 45,717 85,057
Expenditure on:
Raising funds 4 10,399 819 11,218 11,197 982 12,179
Charitable activities 4 21,763 44,775 66,538 24,508 48,523 73,031
Total expenditure 32,162 45,594 77,756 35,705 49,505 85,210
Net income/(expenditure) for the year 6 1,991 1,620 3,611 3,635 (3,788) (153)
Transfer between funds 14 132 (132) - - - -
Net movement in funds 2,123 1,488 3,611 3,635 (3,788) (153)
Reconciliation of funds:
Total funds brought forward at 1 April 14b 14,714 11,344 26,058 11,079 15,132 26,211
Total funds carried forward at31 March 14a 16,837 12,832 29,669 14,714 11,344 26,058
----- End of picture text -----

The result for the year for Companies Act2006 purposes is represented by the net movement in funds in the consolidated statement of financial activities. There are no recognised gains or losses in the current or preceding year other than those shown in the consolidated statement of financial activities above. All amounts derive from continuing operations. There is no material difference between the net expenditure for the financial year stated above and its historical cost equivalent. The turnover of the company for the year was £81,313,000 (2019/20: £84,952,000). The net result of the company for the year was a surplus of £3,611,000 (2019/20: deficit of £153,000). There is no material difference between the entity and the group Statement of Financial Activities.

58 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 59

Balance sheets As at 31 March 2021

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Tearfund Group Tearfund
2021 2020 2021 2020
Note £’000 £’000 £’000 £’000
Fixed assets
Tangible assets 9 1,583 2,459 1,583 2,459
Intangible assets 9 - 18 - 18
Long-term investments 10 - - 5 5
Total fixed assets 1,583 2,477 1,588 2,482
Current assets
Stocks 11 882 1,280 871 1,267
Debtors 12 8,960 10,091 8,977 10,141
Short-term deposits 14,460 11,780 14,460 11,780
Cash at bank and in hand 7,695 5,850 7,674 5,826
Total current assets 31,997 29,001 31,982 29,014
Creditors
Amounts falling due within one year 13 (3,911) (5,420) (3,901) (5,429)
Net current assets 28,086 23,581 28,081 23,585
Net assets 29,669 26,058 29,669 26,067
Funds
Unrestricted funds:
General fund 14a 9,626 3,896 9,626 3,905
Designated funds 14a 7,211 10,818 7,211 10,818
16,837 14,714 16,837 14,723
Restricted funds 14a 12,832 11,344 12,832 11,344
Total funds 29,669 26,058 29,669 26,067
----- End of picture text -----

The financial statements on pages 57 to 76 were approved by the Board of Directors on 14 July 2021 and signed on its behalf by:

Anna Laszlo, Chair of the Board

John Shaw, Treasurer

Consolidated cash flow statement Year ended 31 March 2021

----- Start of picture text -----
2021 2020
£’000 £’000
Net cash provided by operating activities (see below) 4,700 2,273
Cash flow from investing activities:
Investment income receivable 60 145
Purchase of property, plant, equipment and intangibles (139) (384)
Proceeds from the sale of property, plant and equipment - 8
Net cash used in investing activities (79) (231)
Change in cash and cash equivalents in the reporting period 4,621 2,042
Cash and cash equivalents at the beginning of the reporting period 17,434 15,392
Cash and cash equivalents at the end of the reporting period 22,055 17,434
Reconciliation of net income/(expenditure) to net cash flow from operating activities
Net income/(expenditure) for the reporting period (as per the statement of financial activities) 3,611 (153)
Adjustments for :
Depreciation charges 1,033 1,387
Investment income receivable (60) (145)
-
(Profit)/Loss on sale of tangible fixed assets (7)
Decrease/(increase) in stocks 398 (1,227)
Decrease in debtors 1,131 2,479
(Decrease) in creditors (1,413) (61)
Net cash provided by operating activities 4,700 2,273
1April 31March
2020 Cashflows 2021
Analysis of changes in net funds £’000 £’000 £’000
Cash at bank and in hand 5,850 1,845 7,695
Bank deposits 11,780 2,680 14,460
Bank overdrafts (96) 96 -
Interest-free loans (100) - (100)
17,434 4,621 22,055
----- End of picture text -----

60 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 61

Notes to the financial statements 31 March 2021

1. ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared on a going concern basis under the historical cost convention and in accordance with the Companies Act 2006, Charities Act 2011, Charities Accounts (Scotland) Regulations 2006, Charities and Trustee Investment (Scotland) Act 2005, Statement of Recommended Practice (SORP) on Accounting and Reporting by Charities effective from 1 January 2019, FRS102, and applicable United Kingdom accounting standards. The Charity has adapted the Companies Act formats to reflect the Charities SORP and the special nature of the Charity’s activities.

Consolidation

The Statement of Financial Activities (SOFA) and Group Balance Sheet consolidate the financial statements of the Charity and its wholly-owned subsidiary undertaking Tearfund Trading Limited. The results of the subsidiary are consolidated on a line-by-line basis. No separate Statement of Financial Activities has been presented for the Charity alone as permitted by Section 408 of the Companies Act 2006. The Consolidated Cash Flow Statement has been prepared for the group only, as permitted under FRS102.

Accounting estimates and key judgements

Critical accounting estimates and judgements are based on historical experience and other relevant factors, including reasonable expectations of future events. The main areas which involve such estimates and judgements include the accrual of legacy income; entitlement to grant and contract income; useful lives of fixed assets; and provisions.

Company status

Tearfund is a registered charity in England and Wales (number 265464) and Scotland (number SC037624) and is constituted as a company registered in England and Wales and limited by guarantee (company number 00994339). It is governed by its Memorandum and Articles of Association and at the yearend there were 34 members (2019/20: 34) who were each liable to contribute £1 in the event of the company being wound up.

In the application of the Charity’s accounting policies, the particular accounting policies adopted by the Board of Directors have been applied consistently and are described below.

Fund accounting

The company maintains three types of funds. General unrestricted funds are funds available for use at the discretion of the Board of Trustee Directors in furtherance of the general charitable objectives. Designated unrestricted funds are monies set aside by the Board from unrestricted funding for specific purposes. Restricted funds are funds subject to specific conditions imposed by donors. At the year-end any fund deficits are maintained only when the Trustee Directors are of the opinion that such deficits will be eliminated by future committed giving. Income and expenditure on these funds are shown as restricted in the SOFA and analysed into the main components in note 14.

Going concern

During 2020/21 Tearfund’s operations were conducted in line with a revised budget which was approved by the Board in May 2020 following the start of the Covid-19 pandemic and in anticipation of its expected financial consequences. This budget included significant cost reductions to mitigate the potential impacts of a decrease in many of our main income streams. In August 2020 we put in place a two-year £6m credit facility, secured against our Teddington building, to protect against any short-term liquidity issues. Furthermore, the annual review of reserves policy took into account the heightened economic uncertainty by increasing the target range for the general fund to £7m–£10m (previously £4.5m–£6.5m). All these measures combined to ensure that Tearfund is wellpositioned to continue its business-critical activities and remain a going concern.

Key points in assessing Tearfund's going concern status are as follows:

• worst case scenarios for 2020/21 income, developed at the beginning of the pandemic, did not materialise; indeed, unrestricted donations outperformed even our pre-pandemic projections. While recognising that there is still great economic uncertainty and that the future global course of the pandemic remains unpredictable, we have once again experienced both the

loyalty of our supporters and the ability of our fundraising teams to adapt to fast-changing situations

• we are working to a 2021/22 budget and three-year plan which still builds in caution about future income levels. In the light of the strong 2020/21 performance, the Board has approved increased income targets for 2021/22 and accordingly has asked management to develop plans for additional expenditure in areas of strategic importance

• the general fund balance at the end of 2020/21 was £9.6m, at the upper end of the target range. Our plans for 2021/22 unrestricted expenditure are designed to arrive at a year-end balance in the lower half of the target range, representing between two and three months of total unrestricted expenditure, which we believe to be an appropriate level to avoid unacceptable diversion of funds away from the communities we work with

• we have not needed to use the credit facility and prior to its end date in August 2022 we will consider whether there is a need for this to be renewed.

In support of the going concern assessment, we have prepared cash flow forecasts for the next twelve months which are based on the approved 2021/22 budget and three-year plan. We have run stress tests on the forecasts which in the worst case scenario show that unrestricted cash, together with drawing on the £6m of credit facility, would be exhausted by a sustained fall of 45% or more in unrestricted donations. The Board does not consider such a fall in income to be plausible.

Having considered these matters, the Trustee Directors do not believe there is a material uncertainty and so have prepared the accounts on a going concern basis.

Income

All income, including donations, legacies and investment income, is recognised in the SOFA when the Charity can demonstrate entitlement to the income, receipt is probable and the amount can be quantified with reasonable accuracy. The following specific policies apply to the categories of income:

Legacies

Legacies are recognised when they are measurable, probate has been granted and entitlement is clear. No value is included where the legacy is contentious or is subject to a life interest held by another party. The fair value of the legacy income receivable is based on the information available at the time and it is the expected cash amount to be distributed to Tearfund from the estate.

Grants and contracts

Grant and contract income is recognised when the Charity can demonstrate entitlement to the income. Where receipt of funding is conditional only on administrative requirements such as the submission of a claim, it has been accrued. Where there are restrictions on the time period in which funding received can be spent, or where the Charity is not yet in a position to meet the conditions of the funding, the related income has been deferred.

Gifts in kind

Donated gifts in kind for distribution to communities are included in income at donors' valuation or market value when received. Expenditure is recognised when gifts in kind are distributed.

Expenditure

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to that category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources. Like many charities, Tearfund is unable to recover some of the VAT that is incurred on the purchase of goods and services in the UK. The amount of VAT that cannot be recovered is added to the appropriate underlying cost.

The following specific policies apply to categories of expenditure:

Grants payable

Grants payable to Tearfund partner organisations are made in furtherance of the Charity’s objects. Grants are recognised as expenditure when payment is due to the partner organisation, in accordance with Tearfund’s project agreement and in line with phased payment schedules.

Support costs

Support costs include functions such as general management, financial management, information technology, human resources and the cost of premises and facilities. They are allocated across the categories of charitable expenditure, governance costs and the costs of generating funds on the basis set out in note 4 to the financial statements.

Fundraising and publicity

Fundraising costs are those incurred in seeking voluntary contributions and do not include the costs of disseminating information in support of the charitable activities.

Foreign exchange

Transactions denominated in foreign currency are translated into sterling and recorded at the rates ruling at the date of the transactions. Balances denominated in a foreign currency are translated into sterling at the exchange rates at the balance sheet date. Foreign exchange gains and losses incurred in respect of overseas operations are included in the SOFA within the relevant activity expenditure.

Pensions

Tearfund operates two defined contribution pension schemes. Contributions are charged to the SOFA as they become payable.

Tangible fixed assets and depreciation Tangible fixed assets are stated at cost less accumulated depreciation. Assets costing more than £1,000 with an expected useful life of more than one year are capitalised. Depreciation is provided in order to write off the cost of tangible fixed assets over their estimated useful economic lives, on a straight-line basis, as follows:

Freehold buildings
Fixtures, fttings and
including computers
Motor vehicles		 20–50 years
equipment

3–5 years
3–4 years

The useful economic lives and residual value of fixed assets are reviewed at the end of each accounting period. Property and land is tested annually for impairment.

Vehicles and equipment used in

programmes overseas, except for laptops, are considered to have a useful economic life of one year or less. They are not capitalised but are charged in full to charitable expenditure when purchased. However, a register is maintained of these assets and reviewed regularly.

Intangible assets and amortisation

Intangible assets are stated at cost less amortisation. They are amortised on a straight line basis over five years, being the estimated economic useful life of the asset.

Financial instruments

Financial assets and financial liabilities are recognised when Tearfund becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are initially measured at transaction price (including transaction costs). Tearfund only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

Investments

The investment in the subsidiary is included in the Charity’s financial statements at cost.

Stocks

Bought-in goods are valued at lower of costs and net realisable value. Humanitarian supplies are valued at cost with obsolete stock written off.

Cash and cash equivalents

Cash and cash equivalents include interest and non interest bearing amounts held at banks and cash at hand. Short term money deposits including deposits repayable on demand and fixed term deposits are held under current assets as short term deposits.

Other financial assets and liabilities Debtors and creditors are stated at the settlement amount after any applicable discount.

Operating leases

Costs in respect of operating leases are charged to the SOFA on a straight line basis over the lease term.

62 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 63

Notes to the financial statements 31 March 2021

2a. DONATIONS

----- Start of picture text -----
Unrestricted Restricted 2021 Unrestricted Restricted 2020
funds funds Total funds funds funds Total funds
Note £’000 £’000 £’000 £’000 £’000 £’000
Donations from:
Individuals 25,199 10,435 35,634 30,167 9,262 39,429
Churches 1,170 1,413 2,583 1,560 1,547 3,107
Trusts, companies and schools 1,150 4,048 5,198 844 4,328 5,172
Legacies 5,306 151 5,457 5,520 130 5,650
Grants 2b 417 25,683 26,100 - 26,417 26,417
33,242 41,730 74,972 38,091 41,684 79,775
Appeals and emergencies:
Individuals - 3,798 3,798 - 1,180 1,180
Churches - 311 311 - 506 506
Trusts, companies and schools - 147 147 - 329 329
- 4,256 4,256 - 2,015 2,015
Via Disasters Emergency Committee - 1,188 1,188 - 1,826 1,826
- 5,444 5,444 - 3,841 3,841
Total donations and legacies 33,242 47,174 80,416 38,091 45,525 83,616
----- End of picture text -----

Gifts in kind of £36,200 (2019/20: £5,200) of pro-bono legal work, which is included in support cost expenditure, is included above in ‘Trusts, companies and schools’ income.

Notes to the financial statements 31 March 2021

2b. GRANTS INCOME

----- Start of picture text -----
2021 2020
£’000 £’000
United States Government 11,405 12,581
United Kingdom Government 3,612 2,083
United Nations 3,015 5,289
Dutch Government 2,833 2,795
Danish Government 838 -
Canadian Foodgrains Bank 776 1,073
Scottish Government 513 441
Norwegian Government 404 -
New Zealand Government 105 127
States of Guernsey 50 40
Belgian Government 5 -
States of Jersey - 142
Other - (49)
Irish Government - (2)
European Union (2) 526
23,554 25,046
Tear Netherlands (includes funding from the Evangelical Broadcasting Co.) 2,300 1,292
Integral/Other NGOs 246 79
26,100 26,417
----- End of picture text -----

Included within the above grants income are gifts in kind of £1,023,000 (2019/20: £1,753,000) which are also included in expenditure and stock. The whole amount for both years is restricted income. They consist mainly of water and sanitation products; food aid; latrines; and seeds and tools for planting.

Included within grants income from the United Kingdom government is £417,000 unrestricted income related to the furlough scheme.

3. CHARITABLE ACTIVITIES

Unrestricted
funds
£’000

Restricted
funds
£’000

2021
Total funds
£’000

2020
Total funds
£’000
Contract income from DFID contributed to the following programmes:
SWIFT (water, sanitation and hygiene in the Democratic Republic of Congo) 800 - 800 675
Total contract income 800 - 800 675
Other income from charitable activities 36 1 37 516
Total income from charitable activities 836 1 837 1,191

The 2019/20 income of £1,191,000 was unrestricted, save for £69,000 of restricted income included in ‘Other income from charitable activities’.

64 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 65

Notes to the financial statements 31 March 2021

4. TOTAL RESOURCES EXPENDED

----- Start of picture text -----
Direct Support 2021 2020
Grants costs costs Total costs Total costs
£’000 £’000 £’000 £’000 £’000
Unrestricted
Costs of generating funds:
Costs of fundraising - 7,944 2,445 10,389 11,161
Fundraising trading - 10 - 10 36
- 7,954 2,445 10,399 11,197
Charitable activities:
Churches mobilised 1,265 2,252 970 4,487 6,512
Communities transformed 2,082 3,282 1,913 7,277 8,160
Society changed 794 3,311 1,191 5,296 5,699
Emergency needs met 442 1,961 2,300 4,703 4,137
4,583 10,806 6,374 21,763 24,508
Total unrestricted 4,583 18,760 8,819 32,162 35,705
Restricted
Costs of generating funds:
Costs of fundraising - 788 4 792 956
Fundraising trading - 27 - 27 26
- 815 4 819 982
Charitable activities:
Churches mobilised 1,735 2,159 2 3,896 4,125
Communities transformed 4,595 9,595 4 14,194 11,795
Society changed 1,075 1,836 2 2,913 3,290
Emergency needs met 6,803 16,964 5 23,772 29,313
14,208 30,554 13 44,775 48,523
Total restricted 14,208 31,369 17 45,594 49,505
Total expenditure 18,791 50,129 8,836 77,756 85,210
----- End of picture text -----

Many programmes achieve benefits in a number of different areas and their costs are allocated on the basis of their principal aims. Cost allocation includes an element of judgement and Tearfund has had to consider the cost-benefit of detailed calculations and record-keeping in calculating a best estimate of the attributable costs.

Notes to the financial statements 31 March 2021

4. TOTAL EXPENDITURE CONTINUED

----- Start of picture text -----
2021 2020
£’000 £’000
Grants to partner organisations by geographical region:
Africa 10,325 10,067
Asia 3,575 3,342
Eurasia 2,940 2,761
Latin America and Caribbean 1,388 1,037
Total grants to partner organisations 18,228 17,207
Assistance in establishing Tearfund USA 563 666
Total grants 18,791 17,873
Grant management costs were £1,772,000 (2019/20: £2,668,000).
2021 2020
The top 15 countries and regions where grants were made: £’000 £’000
Ethiopia 1,301 992
Democratic Republic of Congo 1,198 937
Nigeria 1,076 1,158
Bangladesh 977 830
Yemen 963 589
Rwanda 845 549
South Sudan 814 885
India 682 689
Burundi 672 593
Afghanistan 585 318
Malawi 577 1322
Indonesia 557 532
Mali 523 360
Lebanon 502 165
Nepal 498 350
----- End of picture text -----

Details of partner organisations included in the top 50 receiving grants can be found at: www.tearfund.org/top50

Support costs and the basis of
their allocation are as follows:
Principal basis of
allocation to activities		 2021
£’000		 2020
£’000
General management, risk and compliance
Headcount and expenditure		 439 315
Financial management
Headcount and expenditure		 1,487 1,445
Human resources
Headcount		 1,985 2,342
Strategy and impact
Expenditure		 213 239
Information systems
Headcount and expenditure		 3,017 3,657
Premises and facilities
Headcount		 1,355 1,647
Governance
Headcount and expenditure		 340 443
8,836 10,088

The 2020 amount for General management, risk and compliance includes £105,000 which was disclosed last year as part of Financial management.

66 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 67

Notes to the financial statements 31 March 2021

5. SUBSIDIARY

Tearfund has a wholly-owned trading subsidiary, Tearfund Trading Limited, which is registered in England and Wales, company registration number 03779450. The registered address is 100 Church Road, Teddington TW11 8QE. The company undertakes various trading activities to raise funds for Tearfund and all its taxable profits are treated as qualifying distribution to Tearfund under Deed of Covenant. Its results and assets for the year ended 31 March 2021 were as follows:

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2021 2020
£’000 £’000
Total incoming resources 54 105
Total expenditure (37) (62)
Profit for the year 17 43
Qualifying distribution (17) (52)
Retained profit/(loss) for the year - (9)
Total assets 32 58
Total liabilities (27) (62)
Funds 5 (4)
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In 2020/21, £12,000 (2019/20: £52,000) of profits were restricted and £5,000 were unrestricted (2019/20: unrestricted loss of £9,000).

6. NET (INCOMING)/OUTGOING RESOURCES FOR THE YEAR

Net (incoming)/outgoing resources for the year are
stated after charging the following:		 2021
£’000		 2020
£’000
Depreciation of tangible fxed assets
Depreciation of intangible fxed assets
Permanent diminution of intangible fxed assets
Auditors’ remuneration: 2021 audit – Tearfund
Auditors’ remuneration: 2020 audit – Tearfund
Other assurance services – Tearfund
Auditors' remuneration: audit – Tearfund Trading
(Proft) on sale of tangible fxed assets
Operating leases: land and buildings – unrestricted		 1,015
18
-
62
5
-
3
-
60		 1,140
163
84
–
54
1
2
(38)
56
Operating leases: land and buildings – restricted 1,008 1,056

The above is all unrestricted expenditure/(income) unless otherwise indicated, except the profit on sale of tangible fixed assets in 2019/20 that comprises an unrestricted gain of £7,000 and a restricted gain of £31,000.

7. EMPLOYEES AND TRUSTEES

To reflect the requirements of the charities SORP, changes to this note have been made in respect of the disclosure of average number of persons employed rather than average full-time equivalent persons; and a review of the disclosure of employee benefits has led to adjustments in the reporting of the prior year costs of overseas employees.

Employee costs 2021
UK
£’000
2021
Overseas
£’000
2021
Total
£’000
2020
UK
£’000
2020
Overseas
£’000
2020
Total
£’000
Salaries and wages 16,310
12,702
29,012
16,292
12,462
28,754
Employee benefts 33
516
549
42
421
463
Social security costs 1,581
64
1,645
1,662
55
1,717
Other pension costs 1,348
185
1,533
1,688
213
1,901
19,272
13,467
32,739
19,684
13,151
32,835

Notes to the financial statements 31 March 2021

7. EMPLOYEES AND TRUSTEES CONTINUED

Included in the above employee costs are redundancy and severance costs of £248,000 (2019/20: £296,000). Redundancy costs are provided for when the decision has been made and the employees have been informed, and the amounts could be calculated with a reasonable accuracy and the settlement is probable in the next financial year.

Average number of persons employed during the year 2021
Number		 2020
Number
UK-contracted employees based:
In the UK 461 484
Overseas 111 128
572 612
Staff based overseas on local contracts 665 661
1,237 1,273

UK staff includes those personnel based at Tearfund’s main UK office in Teddington together with those based in Scotland, Northern Ireland and Wales. Overseas staff on UK contracts includes UK nationals working overseas as well as non-UK nationals employed to work in various countries around the world. Staff based overseas on local contracts are employed mainly on projects funded by institutions. All staff were employed across the range of activities detailed on the SOFA. No employees are employed directly by Tearfund Trading Limited.

The number of employees whose emoluments (including benefits in kind but excluding employer’s pension) amounted to over £60,000 in the year was as follows:

The number of employees whose emoluments (including benefts in kind but excluding employer’s pension) amounted
£60,000 in the year was as follows:		 to over
2021 2020
Number Number
£60,001 – £70,000
13
£70,001 – £80,000
3
£80,001 – £90,000
5
£90,001 – £100,000
1
£100,001 – £110,000
-
£120,001 – £130,000
-
£140,001 – £150,000
1		 16
1
4
-
2
1
-

The two highest paid individuals in the 2021 numbers above are members of staff who work in our international programmes. Their emoluments include accommodation, school fees, medical and other benefits, which allow us to be appropriately competitive in recruiting and retaining staff in the international Non-Governmental Organisation market.

Pension payments of £130,000 (2019/20: £136,000) were made for these twenty three (2019/20: twenty four) higher-paid employees. The total emoluments received by the chief executive in the year was £90,000 (2019/20: £90,000). In 2020/21 the senior executives of the organisation earned a total of £650,000 (2019/20: £653,000) including national insurance and pensions.

Trustees

Trustee Directors and other committee members are not employees and received no remuneration for their services. During the year, two directors/committee members were reimbursed or had costs paid for by Tearfund for a total of £534 for UK travel and subsistence expenses (2019/20: nine for £6,748). No directors/committee members had overseas travel paid for by Tearfund (2019/20: one for £2,447).

Indemnity insurance is provided for the directors at a cost of £10,640 (2019/20: £6,496).

Pensions

Tearfund has a defined contribution pension plan for UK employees called the Tearfund Group Personal Pension Plan and a separate defined contribution pension plan for overseas employees called the Tearfund International Group Personal Pension Scheme. These plans operate on a non-contributory basis.

Included within creditors falling due within one year is £249,000 (2019/20: £224,000) in respect of pension contributions due to be paid to the fund managers.

68 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 69

Notes to the financial statements 31 March 2021

8. TAXATION

Tearfund is potentially exempt from taxation on its income and gains under sections 466 to 493 of the Corporation Tax Act 2010 and Section 256 of the Taxation of Capital Gains Act 1992, to the extent that they are applied for charitable purposes. No taxable profit arises on Tearfund Trading Limited due to the fact that all taxable profits are gifted to Tearfund under Deed of Covenant.

9. TANGIBLE AND INTANGIBLE FIXED ASSETS

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Fixtures,
Freehold land fittings and Motor Total Total
and buildings equipment vehicles Tangible Intangible
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
Cost
At 1 April 2020 2,688 6,229 109 9,026 1,225
Additions - 139 - 139 -
- - -
Disposals (63) (63)
At 31 March 2021 2,688 6,305 109 9,102 1,225
Accumulated depreciation
At 1 April 2020 1,764 4,745 58 6,567 1,207
Charge for the year 76 921 18 1,015 18
- - -
Disposals (63) (63)
At 31 March 2021 1,840 5,603 76 7,519 1,225
Net book value
At 31 March 2021 848 702 33 1,583 -
At 31 March 2020 924 1,484 51 2,459 18
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The book value of freehold land not depreciated is £200,000 (2019/20: £200,000). Tearfund’s offices in Teddington have a book value of £848,000 (2019/20: £924,000) and are insured at a value of £10,000,000 (2019/20: £10,000,000).

The intangible asset is the cost of the purchase of Toilet Twinning.

10. LONG-TERM INVESTMENTS 2021
£’000
2020
£’000
2021
£’000
2020
£’000
Tearfund Group
Tearfund
Unquoted investment in subsidiary -
-
5
5

At 31 March 2021, Tearfund had one wholly-owned subsidiary which is registered in England and Wales.

Organisation name Class of share of capital held Tearfund Trading Limited Ordinary

Nature of business Raising funds through trading activities

Notes to the financial statements 31 March 2021

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11. STOCKS Tearfund Group Tearfund
2021 2020 2021 2020
£’000 £’000 £’000 £’000
Goods held for distribution to communities 860 1,201 860 1,201
Goods for resale 11 13 - -
Disaster management and IT stores 11 66 11 66
882 1,280 871 1,267
12. DEBTORS
Tearfund Group Tearfund
2021 2020 2021 2020
Due within one year: £’000 £’000 £’000 £’000
Amount owed by group undertaking - - 17 52
Tax recoverable 679 502 679 502
Other debtors 1,006 983 1,006 981
Accrued institutional grants 2,515 3,338 2,515 3,338
Accrued legacy income 3,787 4,381 3,787 4,381
Prepayments and other accrued income 973 887 973 887
8,960 10,091 8,977 10,141
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13. CREDITORS

13. CREDITORS
Amounts falling due within one year 2021
£’000
2020
£’000
Tearfund Group
2021
£’000
2020
£’000
Tearfund
Bank overdrafts - 96 - 96
Interest-free loans 100 100 100 100
Amount owed to group undertaking - - - 20
Other creditors 590 1,060 588 1,052
Taxation and social security 1,819 1,767 1,819 1,767
Accruals 1,397 1,949 1,389 1,946
Deferred income 5 448 5 448
3,911 5,420 3,901 5,429

The interest-free loans, which have been made by supporters, are unsecured and have no set repayment date.

Deferred income balance 2021
£’000
2020
£’000		 2021
£’000
2020
£’000
Opening balance 448
378
Released income (445)
(61)
Deferred income 2 131
Closing balance 5 448

70 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 71

Notes to the financial statements 31 March 2021

Notes to the financial statements 31 March 2021

14a. FUNDS MOVEMENT (2020/21)

14a. FUNDS MOVEMENT (2020/21) CONTINUED

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1 April 31 March 1 April 31 March
2020 Income Expenditure Transfers 2021 2020 Income Expenditure Transfers 2021
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000 Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
General fund 3,896 34,153 (29,148) 725 9,626 Restricted funds brought forward 6,113 6,451 (6,216) 2 6,350
Designated funds Country funds - 108 (96) (10) 2
Fixed asset fund 2,477 - - (894) 1,583 Project funds:
Overseas assets fund (111) - (65) 301 125 Institutions and trusts 4,290 31,872 (30,854) (125) 5,183
Strategic priorities 8,452 - (2,949) - 5,503 Connected Church 378 307 (395) (16) 274
10,818 - (3,014) (593) 7,211 Other 563 1,677 (1,558) 16 698
Beneficiary funds:
Total unrestricted funds 14,714 34,153 (32,162) 132 16,837 Other children funds - 2,613 (2,614) 1 -
Restricted funds Issue funds:
Appeals and emergencies: Disaster management - 908 (908) - -
Asia floods 14 - (14) - - Water and sanitation - 2,613 (2,613) - -
Bangladesh 258 892 (540) 4 614 HIV and AIDS - 459 (134) - 325
Burundi and Rwanda 238 1 (150) - 89 Conflict and poverty - 206 (206) - -
Central African Republic 194 - (119) - 75 Total restricted funds 11,344 47,214 (45,594) (132) 12,832
Coronavirus Emergency Appeal - 3,730 (3,051) (12) 667
East Africa 33 3 (36) - - Total 26,058 81,367 (77,756) - 29,669
Indonesia 1,140 2 (563) - 579
Middle East 784 458 (281) - 961 Designated funds are set up for the following purposes:
Myanmar 48 62 (33) - 77 • The fixed asset fund represents the net book value of Tearfund’s tangible and intangible fixed assets to indicate that these
resources are not available for other purposes.
Other 101 4 122 12 239
• The overseas assets fund represents money spent in our overseas locations for the replacement of vehicles and for the provision
Pakistan 145 - (55) - 90 of renewable energy solutions.
Southern Africa cyclone 737 343 (741) (2) 337 • The strategic priorities fund represents monies set aside to fund a range of strategically important projects across multiple
Sudan and South Sudan 167 18 (4) - 181 countries, together with investment in leadership and management development and new information systems.
Syria crisis 825 76 (261) - 640
Yemen 1,429 862 (490) - 1,801 Restricted funds are shown under the following main categories:
6,113 6,451 (6,216) 2 6,350 • Appeal and emergency funds comprise funds raised for specific appeals and emergencies.
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Fund balances may be negative for the following reasons:

At 31 March 2021, the total deficit balances amounted to £335,795 (2019/20: £489,000).

72 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 73

Notes to the financial statements 31 March 2021

14a. FUNDS MOVEMENT (2020/21) CONTINUED

Transfers between funds represent:

Within restricted funds are the following amounts relating to money received from the following donors:

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1 April 31 March
2020 Income Expenditure 2021
Foreign, Commonwealth and Development Office (FCDO) £’000 £’000 £’000 £’000
-
Central African Republic: AID Match (3) 1,773 (1,770)
Haiti: AID Match - 97 (112) (15)
Pakistan: AID Match (44) 277 (231) 2
FCDO & Other:
Burundi Smart CoVid - 9 (9) -
Democratic Republic of Congo Risk Communication - 34 (34) -
Start Network:
Afghanistan - 88 (88) -
Bulawayo - 100 (100) -
Burundi flooding: Alert 421 - 150 (150) -
Ethiopia CoVid - 231 (231) -
Indonesia earthquake - 185 (184) 1
Mozambique - 51 (51) -
Nigeria 2 - (2) -
Nigeria evaluation 3 - - 3
Nigeria Dec-20 - 50 (50) -
South Sudan flooding - 150 (150) -
Total FCDO funds (42) 3,195 (3,162) (9)
Disasters Emergency Committee (DEC)
Indonesia tsunami 92 - (92) -
Cyclone Idai 2019 145 299 (438) 6
Coronavirus - 889 (954) (65)
Total DEC funds 237 1,188 (1,484) (59)
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Notes to the financial statements 31 March 2021

14b. FUNDS MOVEMENT (2019/20)

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1 April 31 March
2019 Income Expenditure Transfers 2020
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
General fund 7,402 29,340 (33,850) 1,004 3,896
Designated funds
Fixed asset fund 3,481 - - (1,004) 2,477
Overseas assets fund 196 - (307) - (111)
Strategic priorities - 10,000 (1,548) - 8,452
3,677 10,000 (1,855) (1,004) 10,818
Total unrestricted funds 11,079 39,340 (35,705) - 14,714
1 April 31 March
2019 Income Expenditure Transfers 2020
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
Restricted funds
Appeals and emergencies:
Asia floods 27 - (13) - 14
Bangladesh - 632 (374) - 258
Burundi and Rwanda 484 7 (251) (2) 238
Central African Republic 287 2 (95) - 194
Democratic Republic of Congo 93 3 (97) 1 -
East Africa 214 4 (185) - 33
Hurricane Matthew 8 - (9) 1 -
Indonesia 1,432 552 (843) (1) 1,140
Middle East 1,520 128 (863) (1) 784
Myanmar 387 115 (454) - 48
Nepal earthquake 156 1 (157) - -
Other 189 3 (61) (30) 101
Pakistan - 189 (74) 30 145
Sahel/Niger crisis 45 - (45) - -
Southern Africa cyclone 1,035 2,132 (2,430) - 737
Sudan and South Sudan 415 14 (426) 164 167
Syria crisis 669 299 (143) - 825
Yemen 1,381 682 (634) - 1,429
8,342 4,763 (7,154) 162 6,113
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74 . Annual Report and Financial Statements 2020/21

Financial statements

Financial statements

Annual Report and Financial Statements 2020/21 . 75

Notes to the financial statements 31 March 2021

14b. FUNDS MOVEMENT (2019/20) CONTINUED

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1 April 31 March
2019 Income Expenditure Transfers 2020
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
Restricted funds brought forward 8,342 4,763 (7,154) 162 6,113
Country funds 158 143 (291) (10) -
Project funds:
Institutions and trusts 3,325 31,108 (29,979) (164) 4,290
Connected Church 415 666 (704) 1 378
Other 300 2,121 (1,869) 11 563
Beneficiary funds:
Other children funds 679 2,722 (3,401) - -
Issue funds:
Disaster management 316 940 (1,256) - -
Water and sanitation 287 2,688 (2,975) - -
HIV and AIDS 271 483 (754) - -
Conflict and poverty 1,039 - (1,039) - -
Other - 83 (83) - -
Total restricted funds 15,132 45,717 (49,505) - 11,344
Total 26,211 85,057 (85,210) - 26,058
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Within restricted funds are the following amounts relating to money received from the following donors:

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1 April 31 March
2019 Income Expenditure 2020
Department for International Development (DFID) £’000 £’000 £’000 £’000
Democratic Republic of Congo Sexual Violence - (29) 29 -
Central African Republic: AID Match 3 1,579 (1,585) (3)
Pakistan: AID Match - 12 (56) (44)
Start Network:
Burundi flooding - 80 (80) -
Democratic Republic of Congo 3 - (3) -
Democratic Republic of Congo IDP of Kamango - 26 (26) -
Democratic Republic of Congo Alert 363 - 128 (128) -
Democratic Republic of Congo Alert 384 - 158 (158) -
Nigeria 15 (11) (2) 2
Nigeria evaluation - 10 (7) 3
South Sudan Ebola - 130 (130) -
Total DFID funds 21 2,083 (2,146) (42)
Disasters Emergency Committee (DEC)
Myanmar refugees 2017 274 81 (355) -
Indonesia tsunami 28 483 (419) 92
Cyclone Idai 2019 - 1,262 (1,117) 145
Total DEC funds 302 1,826 (1,891) 237
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Notes to the financial statements 31 March 2021

15a. ANALYSIS OF NET ASSETS BETWEEN FUNDS (2020/21)

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Unrestricted Restricted Total
funds funds funds
Fund balances at 31 March 2021 are represented by: £’000 £’000 £’000
Tearfund Group:
Fixed assets 1,583 - 1,583
Current assets 17,568 14,429 31,997
Current liabilities (2,314) (1,597) (3,911)
16,837 12,832 29,669
Tearfund:
Long-term investments 5 - 5
Fixed assets 1,583 - 1,583
Current assets 17,553 14,429 31,982
Current liabilities (2,304) (1,597) (3,901)
16,837 12,832 29,669
15b. ANALYSIS OF NET ASSETS BETWEEN FUNDS (2019/20)
Unrestricted Restricted Total
funds funds funds
Fund balances at 31 March 2020 are represented by: £’000 £’000 £’000
Tearfund Group:
Fixed assets 2,477 - 2,477
Current assets 15,767 13,234 29,001
Current liabilities (3,530) (1,890) (5,420)
14,714 11,344 26,058
Tearfund:
Long-term investments 5 - 5
Fixed assets 2,477 - 2,477
Current assets 15,760 13,254 29,014
Current liabilities (3,519) (1,910) (5,429)
14,723 11,344 26,067
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16. OPERATING LEASE COMMITMENTS

At 31 March 2021 Tearfund and the Tearfund Group were committed to making the following payments in total in respect of operating leases for land and buildings:

2021
£’000
2020
£’000
Tearfund Group		 2021
£’000
2020
£’000
Tearfund Group
2021
£’000
2020
£’000
Tearfund
2021
£’000
2020
£’000
Tearfund
Within one year 719 892 719 892
In the second to ffth years inclusive 481 680 481 680
After fve years - 132 - 132
1,200 1,704 1,200 1,704

76 . Annual Report and Financial Statements 2020/21

Financial statements

Notes to the financial statements

31 March 2021

17. RELATED PARTY TRANSACTIONS

A number of the trustees of Tearfund are directors and trustees of other charities and organisations with whom Tearfund has historic relationships. There were no related party transactions.

There were expenditure transfers to the subsidiary of Tearfund of £nil (2019/20: £6,376) in the year ended 31 March 2021. The balance owing by Tearfund Trading Limited to Tearfund at the end of the year of £17,000 (2019/20: £52,000) is disclosed in note 12.

18. ULTIMATE PARENT

The Trustees consider that the ultimate parent and controlling party of the group is Tearfund.

19. CAPITAL COMMITMENTS

At 31 March 2021 there were no contracted or authorised capital commitments (2019/20: £27,800).

tearfund.org

Tearfund

Tearfund, 100 Church Road, Teddington TW11 8QE, United Kingdom +44 (0)20 3906 3906 info@tearfund.org /Tearfund

Tearfund Northern Ireland

Tearfund, 241 Newtownards Road, Belfast BT4 1AF, Northern Ireland +44 (0)28 9073 0060 ni@tearfund.org /TearfundNI

Tearfund Cymru

Tearfund, Salem Chapel, Salem Lane, Church Village, Pontypridd CF38 1PT, Wales +44 (0)20 3906 3906 cymru@tearfund.org /TearfundWales

Tearfund Scotland

Tearfund, Suite 529-534, Baltic Chambers, 50 Wellington Street, Glasgow G2 6HJ, Scotland +44 (0)141 332 3621 scotland@tearfund.org @TearfundScot /TearfundScotland

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XXXXXXX
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Registered office: Tearfund, 100 Church Road, Teddington TW11 8QE. Registered in England: 00994339. A company limited by guarantee. Registered Charity No. 265464 (England & Wales) Registered Charity No. SC037624 (Scotland)