OpenCharities

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

2022-03-31-accounts

Annual Report and Financial Statements 2021/22 . 1

Annual Report 2021/22

Celebrating the past year

Report and Financial Statements 2021/22 Year ended 31 March 2022

----- Start of picture text -----
UK
Bolivia
Burkina Faso
Angola
Guatemala
----- End of picture text -----

Photos (clockwise from top left): Caroline Trutmann/Tearfund (Guatemala), Jonas Yameogo (Burkina faso), Meg Ellis/Tearfund (UK), Arlette Bashizi/Tearfund (DRC), Chris Hoskins/Tearfund (Nepal), Shahadat Hossain/Tearfund (Bangladesh), Chris Hoskins/Tearfund (Ethiopia), Tom Price/Tearfund (Angola), Tom Price/Tearfund (Bolivia)

Contents ——

Copyright © Tearfund 2022. 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: Solange and Jean de Dieu are fully recovered, after being treated for acute malnutrition through a nutrition programme in Burundi Paul Mbonankira/Tearfund

2 . Annual Report and Financial Statements 2021/22

Chair’s introduction ——

As we end this year, some countries seem to be emerging from the pandemic. Lockdowns are ending; jobs have restarted; schools are up and running; vaccines are having an impact on the virus and its spread.

Yet, around the world, those living in the greatest poverty and the most vulnerable contexts continue to face devastation as a direct result of Covid-19. More than 100 million people have fallen back into poverty because of the pandemic. For them, the prospect of death or long-term illness through Covid-19 remains very real in the face of the desperate inequality in global access to vaccines, while economic impact at national level brings destitution at individual and family levels.

Throughout this report, you will read examples of Tearfund working through churches and partners worldwide to help address the immediate impacts of Covid-19. At the same time, they are also responding to the impacts of climate change, conflicts at national, local and family levels, and economic poverty.

In so many of the areas in which we work, these challenges combine to deepen existing fragility. They underline the complexity and interrelationship of the factors which cause so many people to live in poverty.

We have seen powerful evidence, and remain convinced, that the church has a key role to play in addressing these factors: both in the immediate future and in the longer term, whether in the richer nations or in those most directly affected.

We have seen the church stand up and challenge existing power imbalances, both at a global level and locally. We have seen God work through the church to bring transformation in families and in communities. While we continue to develop our approaches, and to work directly ourselves and through our partners, we will keep our focus on the church, as God’s channel for his work.

I am so grateful to our supporters and staff around the world for their gifts of prayer, time and funding this year.

Anna Laszlo Chair

CEO’s introduction ——

Two years on from the start of the pandemic, these remain deeply challenging times. The ‘triple C’ of Covid-19, conflict and the climate emergency continue to put huge pressure on the communities we work with.

Yet, in these difficult days we have hope. Hope that the church really is God’s vessel of transformation. Hope that this is a time of remarkable opportunity for the church and churches: local, national and global. Hope that we will see God move and transformation come to those who live in poverty. Hope that we have our own triple C to help us respond to all the challenges we see: Christ, church and community.

In Tearfund’s work in some of the world’s most challenging places, we see that hope in action. We support churches to bring transformation to their communities; food distribution to the most vulnerable; savings groups that build resilience and confidence; advocacy to challenge harmful practices and to ensure government services; and reconciliation and peacebuilding to address the root causes of conflict. The church being salt and light: bringing good news to those who live in poverty.

And we work too at a global level. Our policy work around climate justice contributed to 39 countries and institutions committing to end fossil fuel financing during the COP26 climate talks in Glasgow. We continue to be successful in challenging the world’s largest companies to reduce their use of plastics. Both locally and globally, we see the church increasingly using its voice to call for justice.

We remain so grateful to God for his provision, and to our amazing supporters and funders for their generosity. After much prayer, Tearfund launched The Well, a dedicated space where individuals, churches and networks from the Black Christian community can come together to support development and integral mission around the world. We have been humbled by the response.

Let us remember our amazing vision to see all people freed from poverty, living transformed lives and reaching their God-given potential. Poverty is not God’s plan. You are.

Nigel Harris CEO

Anna Laszlo, Chair

Nigel Harris, CEO Photo: Margaret Chandler/Tearfund

Photo: Margaret Chandler/Tearfund

----- Start of picture text -----
Annual Report and Financial Statements 2021/22 . 3
Tearfund CEO, Nigel Harris, with James Baiaya, Asia Regional Disaster
Management & Capacity Strengthening Coordinator, in Bangladesh
visiting projects in Cox’s Bazar that support the Rohingya people
Photo: Sanjeev Bhanja/Tearfund
----- End of picture text -----

•••

A united voice on climate justice

Annual Report and Financial Statements 2021/22 . 5

A united voice on climate justice

——

Kuki Rokhum is a staff member at EFICOR, a Tearfund partner that works among India’s poorest people: she hears firsthand how the climate emergency is making their daily struggle even harder.

Kuki believes she’s called to walk alongside these people through her work, and to make their voices heard.

That’s why she joined Tearfund at COP26, the UN climate talks in Glasgow, to bear witness to how the climate crisis is undoing decades of development. Here she reflects on this experience:

Consider a farmer in Jharkhand, east India. He lives with his wife and two children, and still uses bullock carts. When you talk to someone like him, about what life was like before and how it is now, you can see something is wrong. Unpredictable rainfall patterns, sudden disasters… they are the ones who bear the brunt, whose lives will be devastated. They live very lightly on this earth and yet pay heavily.

I have become convinced that caring for the environment is essential. It is not an optional extra that we leave in the hands of those who are ‘keen’. It’s important for all of us not just to be aware of the issue but to take action too.

As human beings, we have a mandate and responsibility to take care of the environment and one another: we have a voice, and we have an opportunity to make sure others are heard too. As Tearfund says, ‘Poverty is not God’s plan. You are.’

That’s why it’s important for an organisation like Tearfund to be at COP26, to speak into it and out of it. COP is a crucial gathering because it encourages nations to assess their

situation and commit to change. We need to influence not just the decision-makers but people around the world beyond our circle of influence. COP allows us to do just that.

Unlike previous COP gatherings, different global partners assembled in Glasgow, with Tearfund’s leading, and we had the opportunity and platform to engage with so many different people, within Glasgow and globally, through the media events.

For me, this was the best COP ever, where so many people from around the world and from different organisations involved in these issues came together. The massive march, the passionate young people gave me hope that we were not alone in raising our voice.

In the Blue Zone, where the key negotiations took place, we were able to speak into many conversations about climate change and conduct side events to show how climate change affects the different constituencies we’re part of. And we were involved in stunts, to raise issues such as fossil fuel funding in the media, so that people outside the talks could get engaged too.

Climate change has become part of everyday conversation. COP should not be just an event: we need to keep these conversations and that momentum going. I believe we can effect change by joining with others and by not shirking our responsibilities to be a voice for those who are never heard.

Kuki Rokum [left] speaking in Glasgow, and [right] taking part in a march on the Global Day of Action Photos: Chris Hoskins/Tearfund

6 . Annual Report and Financial Statements 2021/22

Trustee Directors’ report

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 2022.

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.

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:

----- Start of picture text -----
Churches
mobilised
Emergency Communities Society
needs met transformed changed
see pages 12–15 see pages 16–19 see pages 20–23
----- End of picture text -----

We see mobilising the church as fundamental to achieving the other three outcomes. In our report, starting on page 10, 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 are currently reviewing whether this is still the most appropriate method of reporting.

----- Start of picture text -----
Trustee Directors’ report Annual Report and Financial Statements 2020/21 . 7
Pascaline, with her daughter Colise. Colise survived a severe
malnutrition case when she was a baby. Today she has fully
recovered with the support of Tearfund’s partners
Photo: Paul Mbonankira/Tearfund
----- End of picture text -----

8 . Annual Report and Financial Statements 2021/22

Our corporate priorities

Our corporate priorities

——

These are the key 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.

Partnerships and principles

Our partners are local churches, denominations and Christian national and international NGOs who agree with our Statement of Faith and meet our partnership criteria. Our operational programmes, which are directly implemented and overseen by Tearfund staff, are undertaken in countries affected by protracted and/or recurrent crises, where the availability and capacity of partners is limited.

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

Tearfund upholds a set of corporate Quality Standards which reflect the organisational characteristics we aspire to and the relevant external and internal accountabilities, standards, codes, guidelines and principles we’re committed to. Please visit tearfund.org/qualitystandards

With a shared Christian identity and common goal to reduce poverty and injustice, the Tearfund Family brings together agencies in the UK, Ireland, Belgium, France, Germany, the Netherlands, Canada, USA, Australia and New Zealand.

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 charity’s aims and objectives. The Trustee Directors are therefore confident that Tearfund meets the public benefit requirements of the Charity Commission in our reporting.

Photos (top to bottom): Distribution of emergency response kits for those affected by the deadly earthquake that struck Haiti in August 2021

Photo: Richard Pierrin/Tearfund.

A farming cooperative self-help group growing maize in Rwanda Photo: Pete Dawson/Tearfund.

Abigael, harvesting vegetables in her market garden in the commune of Ouarkoye in Burkina Faso

Photo: Jonas Yameogo/Tearfund

Our corporate priorities

Annual Report and Financial Statements 2021/22 . 9

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

Church and Community Transformation (CCT)

Unlocking the potential of local churches and communities, to catalyse change in even the most remote areas in a cost-effective, holistic and sustainable way.

We believe that local churches – wherever they are in the world – begin a lifelong journey when they embrace and commit to living out a theology of what we call ‘integral mission’. This journey strengthens and inspires them, changes mindsets and brings about ‘whole-life’ transformation in both the church and the community.

The church’s response to local needs is to approach poverty holistically and from within the community, helping people to realise their potential and recognise the resources God has given them. Through the pandemic, our CCT approaches have proven to be pivotal in preparing and equipping churches with foundational theology that has enabled them to continue to respond and catalyse transformation in their communities. Our focus has been on supporting our network of trainers and community volunteers, envisioning new denominations and churches, and continuing to strengthen our processes to ensure we see real impact in varied contexts, from urban settings to oral cultures.

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.

Crisis- and conflict-affected countries represent the most complex contexts we work in. They are vulnerable to innumerable shocks and hazards, alongside deep systemic injustice, political turmoil and fragility. Since 2020, Covid-19, economic pressures and deepening inequality have only made these countries more fragile. In 2021/22 we have worked hard to address immediate needs, ensure equitable access to basic services, and increase the resilience of the most vulnerable people.

We have also focused on addressing harmful social norms and behaviours which underpin fragility and conflict. To do this we have used faith-based approaches to prevent and respond to violence against women and girls, improve equality between men and women in the home, champion women’s rights and voices in decision-making, and empower women to generate income for their families. We have also used faith-based approaches to bridge divides, reduce fear and mistrust between different groups, break cycles of violence and trauma at household and community level, and bring healing and hope to survivors of violence.

Environmental and Economic Sustainability (EES)

Committing to relief and development that is environmentally and economically sustainable, that reduces exposure to risk, and lessens the impact of risk.

We are called to take care of the whole of God’s creation, and we believe environmental sustainability goes hand in hand with economic development and people’s livelihoods. The Covid-19 pandemic has taught us how vulnerable our economic system is. If we continue to exploit and damage the natural environment, life will only become harder for people who rely on it to make a living.

During the last year, we have seen that our EES approach has been effective in creating ‘green’ jobs, whether through waste management and recycling, climate-smart agriculture, or self-help groups teaching livelihood skills to help people generate an income. We recognise that recovery from the pandemic will take years, and climate change is exacerbating tensions over land, pasture and water, and fuelling migration. That is why we are directing our attention and efforts to support those who are most vulnerable and focusing on creating economic opportunities for them that also benefit the environment.

10 . Annual Report and Financial Statements 2021/22

Strategic report

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 2022/23.

The role of the church

We believe that God has chosen the church as his partner in his mission to bring lasting, whole-life transformation to people, communities and creation, and we have the privilege of accompanying churches worldwide in the desire to see the whole of creation restored.

For Tearfund, poverty is holistic: not just economic or physical but also social, environmental and spiritual. We believe poverty is rooted in broken relationships: with God, self, others and wider creation. Overcoming poverty means restoring these relationships. God’s mission of restoration will be complete when Jesus comes again. Until then, the church is called and commissioned to continue that mission. Therefore, mobilising and supporting churches is at the heart of what we do.

We are committed to envisioning and equipping the church at local, national, regional and global levels. We believe, and have seen, that an active and flourishing church partnering in God’s mission leads to:

Communities transformed: When churches lead communities through a process of Church and Community Transformation, they can identify the underlying causes of poverty and overcome them together. When churches are equipped in disaster preparedness and resilience-building, the poorest communities become resilient to shocks and stresses, and are able to recognise and use local resources to help them flourish. Identifying and addressing the underlying causes of broken relationships, the church works to bring peace and unity so that communities can contribute to better futures for themselves and others.

Emergency needs met: An equipped, mobilised church that understands its biblical mandate is ready to respond when a crisis or natural disaster affects community structures and systems. Churches respond to the immediate needs and build resilience to future shocks.

Society changed: Tearfund supports churches to find their voice and challenge social, political, economic and environmental systems and policies that underpin poverty. We work together to ensure these are just and that they work for the poorest communities, ensuring everyone’s access to basic needs, reduced inequality and sustainable growth.

In our understanding of church we include individual Christians, denominations, church congregations, church leaders and Christian partners.

----- Start of picture text -----
Annual Report and Financial Statements 2020/21 . 11
A church service at the Diocese of Matana, Burundi
Photo: Paul Mbonankira/Tearfund
----- End of picture text -----

12 . Annual Report and Financial Statements 2021/22

We want to see emergency needs met

We help build disaster-resilient communities by working with local churches and partners, and through our own teams, to help communities prepare for and respond to emergencies.

This year, we've supported:

1,682,600

people directly through our emergency responses, including:

What is our approach?

Our belief in God’s restoration plan compels us to respond to disasters and conflicts as an expression of love for those in need.

The Covid-19 pandemic continues to cause unprecedented suffering as restrictions and economic shocks threaten to push millions back into poverty. The poorest communities are also suffering the worst impacts of climate change, including rising temperatures and environmental degradation. And conflict and violence continue to cause misery, including this year in Afghanistan, Burkina Faso, Chad, DRC, Ethiopia, Mali, Myanmar, Yemen and Ukraine.

10,200

displaced people supported after the volcanic eruption in Goma, DRC

We’ve also responded to devastating natural and climaterelated disasters, including the volcanic eruption in DRC, an earthquake in Haiti, flooding in Pakistan and tropical storms in southern Africa.

We equip and support churches and local partners to ensure responses are locally-led and contextually appropriate. Our direct access to communities through these links and networks is what makes us distinctive. At the heart of our approach is mutual learning, resilience and a hope mindset. So we also work closely with communities to reduce the risk of future disasters, strengthen coping mechanisms and address underlying vulnerabilities. Where necessary, we also work directly through our own operational programmes currently in DRC, South Sudan and CAR.

We hold ourselves accountable to people affected by disasters, ensuring clear channels of communication so that communities can participate fully and give feedback. We coordinate with networks and peers within the humanitarian sector to ensure best practice across our work.

43,100

people benefited from cash transfers to meet their immediate needs in emergency situations across the world

22,300

people reached through our emergency response programmes in Afghanistan

Dheve and her family outside their home in a refugee camp in Ituri, eastern DRC

Photo: Arlette Bashizi/Tearfund

----- Start of picture text -----
Annual Report and Financial Statements 2020/21 . 13
----- End of picture text -----

14 . Annual Report and Financial Statements 2021/22

Strategic report

These are the key objectives we set ourselves last year for emergency needs met , with examples of how we met them, what we learnt and where we can go further.

1. Adapting resources and gender inclusion

Work alongside church leaders and denominations in West Africa, developing contextually relevant actions to help them prepare for disasters and reduce disasters’ impact

The pandemic has prompted reflection with colleagues across West Africa, which has helped us identify areas where the local church needs strengthening in its disaster preparedness and response.

One area is the adaptation of existing tools and resources to make them more accessible for churches. Disasters and the Local Church is being adapted for online learning, to provide churches in disaster-prone areas with a resource they can use in ways appropriate for their context. We will pilot this in the coming year, working alongside Church and Community Transformation (CCT) facilitators. Feedback from local church networks in each of our regional clusters will inform the final design.

This also created energy to address gender inclusion in our CCT work. We are now integrating learning from our Transforming Masculinities approach, which works with both men and women to address harmful concepts of gender and masculinities. Our goal is to increase gender sensitivity among CCT facilitators and consequently to see women taking the lead in community-level disaster preparedness and response. Bringing women’s knowledge, skills and capacities to bear is likely to have a positive impact for the whole community.

2. Supporting capacity-strengthening initiatives

Support the rollout of the Disaster Management Capacity Assessment programme in Haiti and four countries in Asia, and review findings from the same programme in West Africa

The Disaster Management Capacity Assessment programme has continued to support capacity-strengthening initiatives in West Africa, and new programmes have started in Asia and Haiti. Though the West Africa review has been delayed due to the pandemic, the programme will continue to expand in Asia, southern/eastern Africa and Eurasia in the coming year.

In Nepal, there is already evidence of the programme’s impact. One partner has launched a new digital Initial Disaster Rapid Assessment (IDRA) process. So far this has provided them with needs assessment information within 24 hours of ten recent localised disaster events. This has enabled them to respond quickly: sometimes they have been the first agency on the ground. In Burkina Faso, another partner has been able to leverage and manage donor support due to training its team on writing proposals and cash-programme delivery. They were able to respond swiftly following a terrorist attack in Solhan, providing almost 3,500 people with cash for food, clothes and medicines.

3. Resources for regional staff

Strengthen our regional staff and the guidance they receive, to help them respond to new complex emergencies, building on lessons learnt from Covid-19

A review of Tearfund’s Covid-19 response highlighted the continued need to strengthen our teams and partners in their ability to respond when disaster strikes. This is something Tearfund prioritises, so this year has had a significant focus on supporting and strengthening our staff across the world, to ensure they are prepared to respond to emergencies quickly, appropriately and with maximum impact.

Every context is different, so we have developed a variety of relevant humanitarian learning and training resources in multiple languages to meet the differing needs of our staff globally. This resourcing has ranged from online courses and webinars to mentoring, leadership development and external training. We have worked closely with our country teams and staff to ensure they have the knowledge and skills they need to assess, plan for and respond to complex emergencies in their specific context.

4. Building communities’ resilience

Equip churches and church networks to build communities’ resilience and help them prepare for and respond to disasters

We are passionate about strengthening those at the heart of vulnerable communities so they can respond to disaster. Often that includes helping them see their own potential and the resources they already have. Maria from Zimbabwe explains powerfully how her community’s response to drought has changed through CCT blended with some disaster preparedness training: ‘We thought dependency on handouts was our only way out. However, with these new Bible studies we have realised that God has already provided us with many resources that we can use to prepare for and overcome droughts.’ Two short words are key here: We can.

Subsequent training enabled Maria’s community to establish connections with meteorological services so they could be forewarned of storms and droughts, and also to gradually save up their own emergency funds.

Another example is our work with a community in Nepal that is prone to flooding from the Bakaiya River, as well as lightning and earthquakes. Through its involvement with CCT (known as Sangsangai in Nepalese), local people have grown in confidence, learnt basic first aid and been trained to assess risks and make suitable preparations.

Strategic report

Annual Report and Financial Statements 2021/22 . 15

What we learnt

An evaluation of Tearfund’s global Covid-19 response found that our extensive network of faith-based and local partners contributed significantly to our ability to reach those in need quickly, effectively and appropriately. We also learnt the importance of contextualisation: for example, the public health information materials that had the most impact were those that had been tailored to the local context.

We know we can go further

Climate change is increasing the frequency of disasters and communities’ vulnerability to their effects. For this reason, we are committed to expanding our work in environmental sustainability, in particular, reducing our carbon footprint when we respond to new emergencies and designing environmentally sensitive programmes. We hold ourselves accountable to the Climate and Environment Charter for Humanitarian Organisations, that we signed in September 2021.

Going forward in 2022/23

We aim to:

‘...this year has had a significant focus on supporting and strengthening our staff across the world’

When all seems lost

Setilus was in the market when the earthquake struck. She knelt on the ground and prayed until the shaking stopped.

——

The quake that hit Haiti in August measured 7.2 on the Richter scale and it devastated Setilus’s neighbourhood in Les Cayes. Her home was completely destroyed and her nephew was killed, his body found buried in the ruins the next day.

More than 2,000 people lost their lives as a result of the earthquake and thousands were injured. Homes, schools, churches and hospitals were reduced to rubble.

‘Since the earthquake I feel I can’t do anything on my own,’ says Setilus. ‘My whole body has been shaking: people tell me it’s shock.’

Our partner RIHPED (Haitian Integral Network for Advocacy and Sustainable Environment) responded quickly. In fact, Tearfund helped establish RIHPED specifically so we could help deliver a rapid response in disaster-prone regions.

RIHPED provided about 2,500 people with food and hygiene kits and gave 5,250 people an immediate cash transfer, including Setilus. This money allowed people to prioritise their emergency needs, using it to rebuild their homes or to start a small business.

For Setilus, it meant she could buy food while she recovered and rebuilt her life. ‘This gift is like a treasure for me,’ she says.

Setilus, who was supported by Tearfund’s partner RIHPED in the aftermath of the earthquake Photo: Richard Pierrin/Tearfund

16 . Annual Report and Financial Statements 2021/22

We want to see communities transformed

Our partnerships with local churches and organisations are powerful in helping to transform communities, addressing the root causes of poverty specific to their context and ensuring that everyone, especially marginalised groups, are included.

This year, we're celebrating:

1,297,000*

people reached through community development, including:

What is our approach?

Local churches begin a lifelong journey when they embrace and commit to partnering in God’s mission to bring restoration.

This journey empowers them, changes mindsets and brings about transformation in both the church and the community. The church seeks ‘whole-life’ change, and responds to the needs of their local community holistically and from within. Their destination is what we refer to as ‘Church and Community Transformation’ (CCT) as people realise their potential and recognise the resources God has given them.

CCT approaches vary and are adapted for every different country and church context. They need to be locally-owned to be effective: there is not a set of fixed steps that works everywhere. But we know that, universally, local church leaders and facilitators are key agents of change as they walk closely with individuals and communities.

Again this year, we’ve seen churches stepping up and responding to crises, conflicts, Covid-19 and climate change. These responses have included: peacebuilding, livelihoods, water and sanitation, climate-smart agriculture, self-help groups and savings groups, waste management and smallscale enterprises, and changing social norms and negative behaviours – particularly related to gender-based violence. All of these initiatives are locally-owned and led by churches and local partners. We have seen that their close collaboration at the heart of community brings transformational change.

1,092

self-help groups formed this year

399

individuals empowered and equipped to drive change in their community

268

peacebuilding champions mobilised in conflict-affected countries

Annual Report and Financial Statements 2020/21 . 17

18 . Annual Report and Financial Statements 2021/22

Strategic report

These are the key objectives we set ourselves last year for communities transformed , with examples of how we met them, what we learnt and where we can go further.

1. Environmental and Economic Sustainability projects scale up

Scale up our Environmental and Economic Sustainability (EES) work in Nigeria (recycling), Yemen (solar power), Mozambique (environmental livelihoods) and across Latin America and the Caribbean (creation care and livelihoods)

In Yola, north-east Nigeria, our three-year ‘Trash to Cash’ project, funded by the Norwegian Government (NORAD), has set up a social enterprise gathering and recycling plastics. It will provide an income for 3,000 households in vulnerable riverbank communities when the project is fully operational in 2023.

In Yemen, meanwhile, our local partner is training people in how to build household solar units, and then set up their own businesses. Ongoing research into their business models will help replicate this project in other nations.

Tearfund in Mozambique, with our local partners United Church of Christ in Mozambique (ICUM) and the Youth Skills Development and Occupation Association (ADHOJOMA), are working with local churches, schools and communities on reforestation. So far, more than 4,000 drumstick trees (Moringa oleifera), Aloe vera seedlings and other species have been planted in Manica province. The project is generating an income by producing soaps and skincare products made from these trees and plants. In parallel, solar panels and solar house lights will be installed to reduce deforestation.

Across Latin America and the Caribbean we’ve started a three-year programme to engage and equip country offices and partners to undertake innovative EES projects. So, for example, in Bolivia, projects focusing on recycling and ecologically sound agriculture are developing. Meanwhile in Brazil, there is powerful advocacy to engage the church and environmental leaders on the issue of water.

2. Peacebuilding programmes

Support others to help build relationships between communities in conflict and across social divides in ten countries

Our movement of local peacebuilders continues to grow, with new groups formed in Mali, DRC, Haiti and Chad. In Chad and Mali we brought together 140 leaders from different faiths to work together to reduce tensions over the election period.

In Burundi we are seeing the success of ‘integrated programmes’. Building on teachings of Church and Community Transformation (CCT) principles, they progress to work on gender equity, support for survivors of gender-based violence, peacebuilding and savings group programmes in the same location. Already, these programmes are bringing peace to hundreds of households, and mobilising communities to start new livelihood initiatives and even work together to build health centres and church buildings.

In 2021/22 we continued to consolidate our work around gender norms through both the Transforming Masculinities approach, which aims to shift harmful gender norms and the Journey to Healing approach, through which Tearfund supports

survivors of sexual and gender-based violence. In Nigeria, an evaluation of our Masculinities, Faith and Peace family planning project with Christian and Muslim couples indicated a 40 per cent reduction in intimate partner violence compared with control sites. There was also a statistically significant 40 per cent increase in perception of positive relationships between Muslims and Christians in participating communities.

3. Training church facilitators

Mobilise 1,200 new church members and train them to lead transformative processes in their communities

This year, 2,718 new church facilitators have been trained and are now active in leading churches and communities through a CCT process. A review of the impact of Covid-19 on our CCT work found that success was strongly linked to the facilitators’ ability to adapt and respond to changing situations. This has continued to be an area of investment for us. In Zimbabwe, where there are 129 new facilitators, an evaluation showed that over 60 per cent reported increased household income, improved wellbeing, better personal relationships and strengthened social connections.

In addition, 261 people have been equipped as trainers so they can support members of different churches to become CCT facilitators. These new trainers include cohorts in Nigeria, Mali, Chad, Sierra Leone, Uganda and across Asia.

We have also launched online training for CCT, partnering with Eagles in Malawi to pilot a six-month training project to equip 35 trainers. This is proving highly successful so it will be scaled up in the coming year.

4. Scaling up CCT

Develop a clear strategy for how to mobilise denominations towards CCT

We believe that denominations are key to scaling up our CCT approaches and enabling greater impact and transformation around the world. Denominations have strong connections and networks, a long reach and the ability to influence their local churches and church leaders. We have set out a strategy that aims to engage 500 denominations in the next three years, so that we can see greater scale and impact.

As part of this, we have drawn up a set of 13 key recommendations for how best to engage denominations. These include: scoping the state of the church in the relevant country using the World Christian Database; selecting a proven CCT process, approach or concept; and having a clear ‘end in mind’ that denominations should own so they scale up CCT with their own resources. These 13 recommendations need to be adapted for the local context and strategies decided with CCT staff support.

In several countries, Tearfund teams and partners have already responded creatively: Niger is holding a national envisioning event for the major denominations, Bangladesh has started training five new denominations, and Nigeria saw more than 8,000 people attending a denominational engagement event.

Strategic report

Annual Report and Financial Statements 2021/22 . 19

What we learnt

Working with both faith leaders and community members to address negative social norms and mindsets such as attitudes of dependency needs to be an important part of our livelihoods programmes.

To strengthen economic sustainability, climate-smart agriculture and other environment-related livelihoods programmes should integrate financial management and business training. Connecting the products and services that communities provide to real markets helps them achieve better incomes.

We know we can go further

We are firmly convinced of the importance of involving women and young people closely in our peacebuilding work. This has proved harder than anticipated, however, due to a number of barriers including literacy levels. We will be more deliberate in identifying obstacles and adapting our programming accordingly. Wherever possible, we will try to ensure our peacebuilding work builds on programmes that address gender inequality.

Going forward in 2022/23

We aim to:

‘...these programmes are bringing peace to hundreds of households’

Restoring broken relationships

Conflict engulfed the Central African Republic (CAR) after the overthrow of the government in 2013, and sexual violence became a weapon of war. A painful legacy has been a rise in gender-based violence (GBV) and widespread disrespect for women.

——

Jerine experienced this first hand. ‘My husband had no good word for me and I did not trust him,’ she says. ‘My eldest son would speak back to me angrily and was no longer listening to me.’

Through our Transforming Masculinities approach, Tearfund worked with community and church leaders to help restore relationships within families and communities. Selected people within the community were trained to become Gender Champions who facilitate community dialogues on gender norms and promote behaviour change.

Their input has been life-changing for Jerine. ‘Now, my husband and I are able to plan together and support one another. We both changed. My son is more respectful too.’

The Transforming Masculinities approach is being supported through UK Aid Match in Bangui, Ombelle Mpoko and Lobaye, with more than 200,000 people reached so far. We also work with our partners to support those who have suffered GBV, as well as with organisations and government institutions offering counselling, psychosocial support and rehabilitation.

Jerine and her community have been impacted by the Transformative Masculinities approach, which works towards improving attitudes on gender norms and preventing sexualand gender-based violence Photo: Diane Igirimbabazi/Tearfund

20 . Annual Report and Financial Statements 2021/22

We want to see society changed

We partner with local, national and international churches and organisations to see systems and policies changed so that they tackle poverty and injustice and protect the whole of creation.

What is our approach?

This year, we're celebrating:

58

pro-poor public policies and practices changed that can be linked to Tearfund’s influence and advocacy

For decades now, we have worked alongside vulnerable communities to bring their needs and concerns before those who have the power to change their situation. We consider it part of our biblical mandate as Christians to make the voices of those on the margins heard.

So we equip and support communities to ensure that their priorities are brought to the table so that decisionmakers, whether at local planning meetings or international summits, can act upon them. We use advocacy and influence – with the church, government and the private sector – to challenge injustice and demand change, and we help our partners to do the same.

We inspire Christians in the UK and globally to campaign, pray and live out the change they want to see more widely, including through the international Renew Our World movement that we helped establish. Engaging the church with issues such as the climate crisis and its impact on the poorest communities is key to our work.

We leverage the church’s reach and influence to amplify the voices of more vulnerable communities through our networks and advocacy movements. By working with local churches, we ensure that changes in policy, systems and theological thinking translate into change at community level.

190,000

campaign actions taken globally calling for climate action and a fair, green recovery from Covid-19

104

regional networks, denominations and youth movements mobilised to advocate on environmental and justice issues

Up to 614 million

people reached* by our media coverage around the G7 and COP26 summits

*based on media coverage achieved

Supporters and staff at the march on the Day of Climate Action Photo: Chris Hoskins/Tearfund

Annual Report and Financial Statements 2020/21 . 21

22 . Annual Report and Financial Statements 2021/22

Strategic report

These are the key objectives we set ourselves last year for society changed , with examples of how we met them, what we learnt and where we can go further.

1. Influencing climate change commitments

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

We won the Sheila McKechnie David & Goliath Award for our successful campaign urging the UK Government to end fossil fuel financing overseas. Building on this success, we worked with the UK Government to press other countries to follow suit.

Around the G7, we played a key role within the Crack The Crises coalition, and led on the Wave of Hope action which reached 82 million people. Our G7 report, Cleaning up their act? , had widespread media coverage, including in the Financial Times , and was politically influential.

Our prayer and church service resources engaged thousands of people. Our staff were in Glasgow for the UN climate conference COP26, alongside partners and allies from the world’s poorest communities. We prayed, lobbied and met with decision-makers, provided updates to supporters and the media, and coordinated Tearfund supporters to join marches around the UK. Although the G7 and COP26 did not go far enough in their commitments, we achieved some key policy wins, such as a pledge to ‘phase down’ coal being mentioned in a summit agreement for the first time.

2. Campaigning for a green and fair recovery

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

We continued our Reboot campaign to call on the UK and other governments to invest in a green and fair recovery to the pandemic. We also worked with The Justice Conference and Renew Our World to launch the Reset21 campaign, with similar aims.

We called for recognition of the role local faith leaders have played in helping communities respond to and recover from the pandemic, including at a World Bank summit and a World Health Organization forum. We also joined the People’s Vaccine Alliance to call for free, fair and equitable access to Covid-19 vaccines, and we supported partners worldwide to do the same, including in Brazil and Ethiopia where they ran successful campaigns and other advocacy initiatives. In Nepal, we advocated for local actors to be included in the government’s Covid-19 response, and we produced a report with public policy recommendations for the government’s response to the ongoing crisis.

3. Mobilising networks and movements

Mobilise regional networks and movements to advocate and influence decision-makers on environmental and justice issues

We continued to work with the Renew Our World movement and national movements in more than 20 countries to advocate on climate, waste and injustice. Together, we saw deep engagement of supporters and activists on these issues, and policy and practice changes in 17 countries, as well as at a regional and global level. Our advocacy work calling on fast-moving consumer goods companies to address their plastic pollution was successful, with both Coca-Cola and PepsiCo committing to reduce virgin plastic.

We launched Climate Leadership training for church networks and worked with 16 groups to launch the Abundant Africa report, which presents a big, collective vision for a renewed Africa. We organised an online Justice Conference attended by 2,266 people from around the world, followed by a Climate of injustice webinar series. We also worked with theological education organisations in Latin America and the Caribbean, Africa and Asia to incorporate Environmental and Economic Sustainability theology into their curricula. Furthermore, we supported networks and movements to campaign on other issues of injustice, including the rights of migrants in Latin America.

Tearfund played a crucial role in negotiations on a new UN Treaty to stop plastic pollution. We ensured that the Treaty mandate included the impact of plastic pollution on people in poverty, and that the central role of waste pickers was recognised.

4. Engaging with youth

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

We continued to run our Young Theologians programme with 14 emerging theologians from around the world. The programme has given the young theologians experience and exposure that sets them up for long-term influence in the church around poverty and other justice issues. We have been building strong relationships with youthfocused organisations globally to equip young people with a holistic understanding of mission and justice.

We are also taking steps to ensure that youth engagement is part of every aspect of our advocacy and influencing work. For example, engaging young people is already a priority in our country and regional strategies in the Latin America and Caribbean region. Likewise, our Church and Community Transformation (CCT) work in Nepal is largely youth-focused, and so too is our peacebuilding work globally.

Strategic report

Annual Report and Financial Statements 2021/22 . 23

What we learnt

By targeting our policy reports at the media and including testimony from those directly affected by emergencies, we could put more pressure on decisionmakers and achieve much greater impact.

We and our partners have had to learn to be agile in responding to the increasing inequality of Covid-19 vaccine distribution, because of the adverse effect this has had on the world’s poorest people.

We know we can go further

The G7 and COP26 made some significant progress in tackling climate change, but commitments made did not go far enough. Continuing and scaling up our advocacy efforts, alongside many other charities, movements and allies, will be important in the next few years.

Going forward in 2022/23

We aim to:

‘Although the G7 and COP26 did not go far enough in their commitments, we achieved some key policy wins’

A greener, fairer future

Tearfund Nigeria had set out our big vision for national renewal in the wake of the pandemic through a Nigeria Reboot campaign and the policy proposals in the ‘Nigeria Green Papers’ which we developed with church denominations and peer agencies.

——

We then chose Plateau State in central Nigeria as a ‘testing ground’ to model at a local level the policy and practice changes we were lobbying for nationally. Plateau State is known as the nation’s breadbasket but rising levels of poverty and inequality, exacerbated by Covid-19, have threatened this reputation.

Our partner Jos Green Centre mobilised young people to collect 50,000 pieces of plastic waste – and then involved them in building a new youth-led community livelihoods centre, integrating recycled plastic in its design. This proved that environmentally sustainable development could address other social issues such as high youth unemployment, and gave our advocacy credibility.

On the back of this, Jos Green Centre was invited to draft a Bill on waste separation, with our support, which has gone before the Plateau State Assembly, and Tearfund Nigeria has collaborated with the state government to develop a Green Growth Strategy. We and our partners also supported the state government to conduct a green audit of public policy across key ministries.

Presentation of the Plateau state Green Growth Strategy Photo: Samuel Attah/Tearfund

24 . Annual Report and Financial Statements 2021/22

Strategic report

Our supporters

Our supporters are at the heart of who we are as an organisation and all that we do, so we work hard to nurture relationships with them and connect them with all that God makes possible through their partnership, generosity and prayers.

This year, we're celebrating:

£79.5m

raised to transform lives around the world

What is our approach?

Time and again, we are overwhelmed by the generosity and passion of Tearfund supporters. They are absolutely central to our work: we see them as partners in mission. Through their prayer, fundraising, regular giving, donations to emergency appeals, campaigning and lifestyle changes this year, our supporters have played a crucial role in bringing God’s love and practical help to millions of people. So we work hard to connect them to the communities served by their generosity and to share the impact that their support has had on individuals and communities in the greatest need.

34,800

views of our online events such as Declaration , our Christmas carol service and COP26 church service

Our Christian faith defines who we are as an organisation and how we interact with others, including our supporters. It matters to us that every aspect of our fundraising and our spending should express our Christian values of integrity, accountability and gratitude.

Our supporters’ views are vital to us as we seek to communicate and fundraise in a way that honours both supporters and the communities we work with. Supporters have many opportunities to feed back, including in paper and online surveys, on our website and in answer to our emails. We take their responses seriously and circulate a summary of their feedback each month across the organisation, including to the Executive Team.

£3.6m

donated to the Afghanistan crisis appeal

17,400

households twinning their toilet, tap, bin or fridge through our Twinning campaigns

Graham Stuart and fellow rowers who rowed across the Atlantic ocean (see page 27 for details)

Photo: Rannoch Adventures

Annual Report and Financial Statements 2020/21 . 25

26 . Annual Report and Financial Statements 2021/22

Strategic report

These are the key objectives we set ourselves last year to engage our supporters , with examples of how we met them, what we learnt and where we can go further.

1. Engaging new churches

Implement plans to engage a broader range of churches in the UK

We have begun reaching out to a wider range of churches in the UK and are encouraged to have built relationships with a number of new churches and networks this year. We are grateful for opportunities to visit churches and speak at church events and conferences where we have been able to share Tearfund’s mission and explain priorities such as environmental sustainability.

and Declaration are examples of successful online or hybrid events this year. Each event has been an opportunity for creative solutions and learning.

We’ve continued to improve our website, prioritising updates that will give our supporters a better experience, with more accessible and relevant content. We’ve revamped some of our regular emails and worked on reducing the total amount of emails we send to supporters by introducing a round-up email each month. We have also refreshed One Voice , our weekly prayer email. We have created a new social media channel on TikTok to connect with a younger audience.

We are particularly excited to have launched The Well, a powerful initiative working with Black Majority Churches to tackle extreme poverty and injustice, and to have organised Declaration , a multimedia prayer event, for the second year running.

We were encouraged that 2,700 churches signed up to use our COP26 resources, and many churches have told us they have found these materials helpful as they consider their own response to climate change.

2. Launching a new fundraising campaign

Launch a campaign enabling supporters to help those affected by climate change and highlighting the church’s vital role in this

November 2021 saw the UN climate talks (COP26) held in Glasgow. Working with the Global Advocacy and Influencing Group, Tearfund engaged more than 600 churches to pray, act and give in response to climate injustice. More than 50 of these churches declared a climate emergency and many young people engaged their churches and politicians on this issue through our Take a Stand campaign.

To build on communications around COP26, Tearfund’s harvest and Christmas appeals centred on the theme of ‘pushed back into poverty’, highlighting the way climate change is reversing decades of development. Both harvest and Christmas appeals highlighted the vital role of the local church in supporting communities to adapt and respond to the impact of climate change, and our supporters gave generously to both appeals.

3. Enhancing supporters’ online experience

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

Many in-person events were cancelled or postponed due to Covid-19, so we’ve continued to adapt our events and campaigns to allow supporters to connect with us in different ways. The Big Quiz , our Christmas carol service

Strategic report

Annual Report and Financial Statements 2021/22 . 27

What we learnt

We have listened to supporters’ feedback concerning the frequency of our communications, and this year we reduced the number of emails that we sent. We have had positive feedback about this approach, and will continue to work towards providing relevant and timely information for our supporters.

We know we can go further

We are going to do more work on search engine optimisation to ensure that people find what they need from us in the places they expect to, and will continue to make our website and communications more accessible and relevant to our supporters. We also recognise the need to engage supporters both in-person and online so we will continue to hone our approach, including by developing more hybrid events.

Going forward in 2022/23

We aim to:

Rower’s heart for climate justice

Professor Graham Stuart is not easily daunted but the challenge he set himself was huge.

——

At a time of life normally associated with more leisurely pursuits, Graham decided to row across the Atlantic to raise money for Tearfund.

And in doing so, this consultant cardiologist had pitted himself against an even greater challenge: the climate crisis. His goal was to support our work helping vulnerable communities adapt to the changing climate.

‘The reaction of my family and colleagues has largely been supportive,’ Graham says. ‘[But] some thought I was completely mad.’

So, for 41 days from December 2021, Graham stepped aside from his work at Bristol Children’s Hospital and the Bristol Heart Institute, and his professorship at the University of Bristol.

And he joined a team of 12 rowing the 2,600 miles between the Canary Islands and the Caribbean – and raised almost £20,000.

‘I think climate change is probably the biggest problem facing humanity,’ says Graham, who’s been a Tearfund supporter since his teens. ‘And we really have to do something about it.

‘Climate change is an example of where we have to show love to our neighbours in a very practical sense. It’s a matter of justice.’

Graham Stuart, completed his challenge to row the Atlantic ocean in 41 days Photo: Rannoch Adventures

28 . Annual Report and Financial Statements 2021/22

Strategic report

Snapshots of our supporter family

Kezzie’s marathon-running career ends on a high for Tearfund

Kezzie took up running after she retired and has completed numerous marathons, half-marathons and 10ks over the past few years. She’s hung up her marathon running shoes now, but not before running the London Marathon in support of Tearfund. We were honoured that Kezzie chose to run her last-ever marathon for us. Kezzie not only ran it in an amazing time – five hours and 26 seconds – but she also came seventh in her age category and raised over £600 for Tearfund!

Young family moved by Afghans’ plight fundraise with sweet treats

Siblings Esther and Nathan, who are nine and seven, saw some images on the news of people in Afghanistan and wanted to do something to help. With their three-year-old brother, Matthew, and a little help from Mum, they set about making chocolate apples and toffee apples. ‘They set up a table at the end of our driveway on a lovely sunny Saturday at the end of October,’ says their mum, Rachel. ‘We were delighted that so many people stopped and bought apples. We were all sold out in less than three hours!’

Emma’s art for justice’s sake inspires campaigners at COP26

In Spring 2021, Tearfund supporter and activist Emma Major created 40 abstract paintings and associated haiku poems as a form of prayer around caring for creation. Emma’s paintings went on to feature in exhibitions at churches in Reading and Earley before travelling to St George’s Tron in Glasgow, Tearfund’s base during COP26 in November.

During the two weeks of the UN climate summit, hundreds of people enjoyed the paintings as they visited St George’s Tron for prayer meetings, services, concerts and talks. And sales of the paintings raised £1,000 for Tearfund’s climate justice work overseas. The paintings and poems are soon to be published in a book alongside additional reflections and prayers, ‘to increase awareness and action around climate justice,’ says Emma.

Anglesey scouts make short shrift of sponsored bathroom clean

The cubs and scouts of 1st Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch rejoice in the longest name – and the longest group name badge – in European Scouting. Now they have another boast: they’ve twinned the toilets and tapstand at their campsite in Anglesey.

The group decided to support our Toilet Twinning and Tap Twinning campaigns, which provide safe toilets and clean water in remote and vulnerable communities. So they asked relatives and friends to sponsor them to clean their bathrooms at home for a fortnight. Goronwy had loocleaning lessons from his grandma. ‘I felt happy that I was helping to raise money for people who don’t have much money compared to us,’ he says. Now their campsite facilities have certificates of latrines and water facilities they’ve helped fund, and their uniforms have a new Toilet Twinning badge on the sleeve.

Photos provided by Tearfund supporters

Board & Committees highlights

Annual Report and Financial Statements 2021/22 . 29

Board and Committees’ highlights

——

The Board committees are made up of people with specialist knowledge and expertise who meet four times a year. They report into the quarterly Board meetings.

The Safeguarding Committee provides Board oversight of how Tearfund’s safeguarding culture develops, how cases are handled and how learning is embedded. It supports the Board in overseeing how Tearfund’s safeguarding policies and procedures are shaped and implemented.

The Theology Committee serves to ensure that Tearfund’s response to injustice and poverty reflects God’s heart. Its role 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. It exists to help Tearfund stay ‘on track’ with its biblical mandate.

The Global Fundraising and Communications Committee seeks to support, pray for and bring challenge into the work of the Global Advocacy and Influencing Group and the Global Fundraising Group. The committee plays an oversight role: bringing its expertise to envision and encourage, and to balance risk.

The International Impact Committee ensures 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 means we will always be learning and improving how we work, and ensuring we are focusing our efforts where we can achieve the best outcomes.

The Audit Risk and Finance Committee aims to promote and ensure good governance, sound financial management and disciplined risk-taking, working closely with Tearfund management, to make sure resources are stewarded well.

Over the year, the Board – both directly and through its committees – continued with its governance responsibilities: strategic engagement and direction; setting and monitoring performance against risk appetite and policy; and general oversight and accountability. As questions of decolonisation, legitimacy, and focus of power and decision-making are rightly being raised in this sector, the Board has spent time reflecting on these matters and their implications for Tearfund and its work over the medium and longer term. It was delighted to welcome the new Trustee Directors, Catherine de Souza and Yemi Oduslolu, who have further strengthened the range of diverse voices and experience at Board meetings; this has enhanced the richness and depth of debate, and the robustness of decisions taken.

Among the many other matters considered this year, the Global Fundraising and Communications Committee and the Board spent time considering the strategic role that prayer plays in Tearfund’s mission, and how to build this more intentionally into its work and planning. The International Impact Committee focused a meeting on how best to strengthen the measurement and reporting of the impact of Tearfund’s work. The Board celebrated the establishment of a new Board committee to oversee and support the work of The Well. And in the light of the overwhelming needs around the world today, and our desire to work in some of the most difficult contexts, the Board continued to monitor the wellbeing of staff and the framework of expectations and support in place for them.

The Diversity and Inclusion Committee’s purpose is to act with and on behalf of the Board in supporting and holding the Executive Team to account on the delivery, implementation and effectiveness of its diversity and inclusion strategy. The committee’s key aim is to see measurable changes in Tearfund’s organisational culture.

The Well Committee assists the Board in deepening its engagement with Black Majority Churches in the UK, bringing together experience, networks and technical expertise to enable the committee collectively to curate The Well (see page 26 for further information).

30 . Annual Report and Financial Statements 2021/22

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. This is set out in the Governance Manual Section 4, and Appendix 8, page 14. These sections explain the roles and responsibilities of the seven Committees and highlight some of their principal areas of involvement and decisions taken during 2021/22. 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 9). Each of these corporate priorities has detailed three-year plans and the Board receives regular reports on their progress and challenges.

Over this past year, once again, we’ve seen churches continuing to step up and respond to crises, conflicts, Covid-19 and climate change. These responses have included peacebuilding, livelihoods, water and sanitation, climate-smart agriculture,

self-help groups and saving groups, waste management and small-scale enterprises, and changing social norms and negative behaviours particularly related to gender-based violence. Our business plan, approved in March 2021, set out our key objectives for the year with a focus to continue supporting churches and local partners in community-owned and community-led processes. We’ve continued to see that CCT is a very valuable method which prepared the church for protecting communities during the pandemic and for caring for the most vulnerable. As countries are opening up, there are more opportunities for in-person meetings, training, and visits with partners, churches and communities. We are using this opportunity to review with partners and churches our plans and strategies over the coming year in order to continue to adapt and adjust to external factors. We are keenly aware of the impact of ongoing conflicts around the world and their longer-term repercussions for individuals and communities, along with climate change, and the endemic nature of Covid-19. The conflict in Ukraine is also increasing food insecurity around the world, with significant impacts on the cost of living affecting the most marginalised and vulnerable. We will continue to monitor this and are factoring this into our current and future plans.

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. Where we have returned to our offices, we have ensured all relevant guidance and requirements have been followed, in order to protect staff and have safe working environments. Over this past year we have moved towards hybrid working and this will continue into the coming financial year. As we move to hybrid as a ‘new normal’, we will continue to ensure that all staff can engage from all around the world. This will build on the gains we’ve made through virtual working to move towards being a fully global organisation. We will continue to support staff in this transition, in particularly ensuring the health, safety and wellbeing of all.

Towards the end of 2021/2022 we’ve seen an increase in staff travelling as more countries have opened up. This has allowed key staff to travel and meet for the purposes of strategy, audit, evaluations, and partner and project visits. As travel increases, we are monitoring our environmental commitments, as well as continuing to ensure the safety and security of our staff.

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.

Annual Report and Financial Statements 2021/22 . 31

Stakeholder engagement

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 (see page 22).

The importance we attach to building relationships with our committed, generous donors and supporters is affirmed on pages 24–28. 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 our 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. Community transformation 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 to 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 decisionmakers who can influence significant change. We are continuing to develop the reporting of our own environmental performance (see page 37).

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. We remain committed to financial and risk management, compliance, safeguarding and good governance. We are committed to a focus on the charity’s impact and have made more investments this year to enable and plan for a large impact study on our CCT approaches in 2022/2023. In March 2021 a new Board Evaluation process was adopted following the 2020 Governance Review of recommended practice set out in the Charity Governance Code. A similar process to evaluate Committee effectiveness will begin in 2022/23.

In September 2021, the Board discussed the Board annual evaluation and had an update on the Chair’s appraisal. The evaluations showed a good level of effectiveness and so the recommendation was made that further Board-level annual evaluations alternate ‘light touch’ with in-depth reviews. The CEO and Board Officers were developing a rolling succession plan for trustees and, following discussion, there was a recommendation that the Chair should consider establishing a Board Nominations/Development Committee to support the Board’s governance.

In December 2021, a report to the Board demonstrated that all actions from the 2020 Governance Review were now complete or were ongoing. The Board noted the following items as yet to be implemented: diversity, skills and experience-mapping for the Board and Committees; and consideration of issues around our stakeholders: namely, identification, communication with and accountability to them.

Last year we reported on the strategic dashboard to track our top-level key performance indicators (KPIs) and qualitative data and to monitor how well we are outworking our strategy. This has been implemented this year and we are collecting data against the outcomes we want to see – churches mobilised, emergency needs met, communities transformed and society changed – and 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.

32 . Annual Report and Financial Statements 2021/22

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.

Organisation

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.

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 and, following the loosening of Covid travel restrictions, regular opportunities will be given to visit overseas programmes to gain a wider appreciation of Tearfund’s work.

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. The Board also set targets for diversity within its membership which were achieved during 2021/22. The targets for Board membership include:

The current composition of the Board of Trustee Directors and the committees is set out on page 40 to 41. 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.

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 action plan was reviewed in December 2021 and further actions were agreed in relation to the few areas which remained outstanding.

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 Chief Executive and approval of the long-term objectives and strategy.

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.

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 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 staff representation bodies, the Staff Council in the UK and the Southern and East Africa 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 setting up a Staff Council in East and Central Africa, and councils in other regions will follow.

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. We also hold regular question-and-answer sessions for staff with the CEO and executive directors to ensure that employees have the opportunity to hear about and ask questions on matters affecting them. 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.

Volunteers

The financial statements do not reflect the considerable and vital support given to Tearfund by more than 1,300 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

Annual Report and Financial Statements 2021/22 . 33

Structure, governance and management

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 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 receives regular 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 once a year.

Tearfund operates a 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.

Over the past three years, the Trustee Directors have overseen the implementation of an organisationwide risk management system to integrate risk management into Tearfund’s main corporate activities for setting strategy, allocating resources, monitoring performance, and making decisions in the pursuit of the organisation’s objectives. The system includes a comprehensive Risk Management Policy, Risk Appetite Statement and Risk Management Procedure, which provide clear accountabilities, structures, guidance, training and processes for managing risks to stakeholders’ and the organisation’s objectives. During 2021/22, most of the final elements of the system were implemented, so the focus in 2022/23 will be embedding the system as part of normal operations and governance.

Tearfund maintains a comprehensive risk register which identifies the major strategic and operational corporatelevel risks and how they are being managed. The top risks are shown on pages 38 to 39. 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. The Head of Risk and Compliance works with the Executive Team to compile an Annual Review of Corporate Risks and Risk Appetite, which is presented to the Board. 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 42, 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. All frauds are reported to the Charity Commission. 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 34 to 35.

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. 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:

Under our current pay policy we aim to pay staff working outside the UK at the mid-point of market benchmark data. For staff working in the UK, we aim to pay between the 37.5th percentile and mid-point of the market benchmark data.

We take inflation into account by considering yearly increases based on available finances, although we acknowledge that it would be unaffordable for us to keep up with the very high current levels of global inflation. We also consult with the Staff Council and carry out 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 59.

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. Tearfund does not have grantmaking activity in Scotland.

34 . Annual Report and Financial Statements 2021/22

Our commitment to safeguarding

Our commitment to safeguarding

——

We are deeply committed to following Jesus’ example in treating everyone with care and respect. We want to help build 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, the communities we serve: some of the world’s most vulnerable people.

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.

Our Safeguarding Committee provides Board oversight of how Tearfund’s safeguarding culture develops, how cases are handled and how learning is embedded.

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

This year, the committee has supervised the completion of an action plan which has further strengthened Tearfund’s response should our staff become the victims of sexual or violent physical assault. The committee has helped improve and make clear the safeguarding responsibilities of those we contract to work with the communities we serve.

We are committed to training our staff, representatives and partners on safeguarding good practice. Our mandatory e-learning on safeguarding

children and adults at risk is completed by all staff each year, and by Board members at regular intervals. The training is updated annually to take into account learning from past incidents and emerging sector good practice. Our network of country, cluster and directorate ‘focal point’ personnel have received additional in-depth training during 2021/22. 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.

We continue to strengthen safer recruitment practices in line with sector good practice: we carry out Disclosure and Barring Service (DBS) checks for UK staff to ensure that all relevant staff and representatives are securely vetted and safely recruited to work with children and vulnerable adults. We use a third-party provider to carry out international criminal record checks, and to ensure that our pre-employment checks for non-UK citizens are robust. We are a member of 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 harrasment misconduct in previous posts. We are committed to responding to such checks about former Tearfund employees.

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 and an independently administered 24/7 whistleblowing hotline, Safecall, with

the option to report in more than 100 languages. These mechanisms are advertised through accessible 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 safeguarding-incident reporting for staff by including a link on the opening page of our Corporate Hub. We are also working more closely with regional leaders to discuss safeguarding culture in each region and we monitor safeguarding cases reported.

We also recognise that members of communities 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 continually monitor advice and information circulated by our regulators. In November 2021, the Charity Commission published an updated version of its guidance, ‘Safeguarding and protecting people for charities and trustees’.

This update includes a new section on managing the safeguarding risks when operating online.

During Covid-19 restrictions, Tearfund developed an improved safeguarding risk assessment for online events, designed to keep staff and participants safe. This work ensured we were already adhering to Charity Commission advice and guidance when it was published.

Supporting survivors

We take a ‘survivor-centred’ approach to safeguarding and will work sensitively with the survivor

Our commitment to safeguarding

Annual Report and Financial Statements 2021/22 . 35

to ensure that whenever possible, their wellbeing and interests are prioritised. We keep our processes of support under review to ensure we follow sector best practice.

Handling complaints and concerns

In accordance with our casemanagement process, all safeguarding complaints and concerns are reviewed initially by our Safeguarding and Investigations Manager and then by the full Safeguarding and Whistleblowing Review Team. This team is formed of key senior staff from our International Group, HR and Legal teams and includes the Director of People & Talent who is Tearfund’s Safeguarding Officer. Our Board Safeguarding Committee also provides invaluable oversight, advice and scrutiny of safeguarding cases.

The level of safeguarding incidents reported remained low during 2021/22. 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.

Assessment of safeguarding risks

We continue to develop and strengthen our approach to assessing our projects, programmes, activities and events (including online) 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.

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.

2021/22 Review of cases

We work in more than 50 countries through 227 partners and have reached 1.7 million people through our response to disasters and 1.3 million people through our community development work this financial year. We carried forward four cases from 2020/21 and during this period we received 15 new safeguarding cases through our safeguarding

channels. We investigated and closed 13 cases; and six cases remain as open investigations at the year end. Of the 19 safeguarding cases dealt with during the year:

Child safeguarding

None of the 19 cases investigated related to the safeguarding of a child involving either a Tearfund member of staff or representative. One case involved the sexual abuse of a child by a member of partner staff. Three cases involved the abuse of a child by a member of the community. In all substantiated cases the perpetrators were dealt with appropriately by Tearfund, the partner and/or reported to 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.

Adult safeguarding

Eight of the 19 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. Five of the cases were investigated and closed; three cases remain ongoing. Of the five closed cases, one involved allegations of sexual abuse, exploitation and harassment by a member of partner staff towards another partner staff member. Tearfund followed up all

the cases with the partners and offered support as appropriate. 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 2021/22 we implemented a number of actions to address safeguarding learning points we had identified. These included:

As an organisation we remain committed to being proactive in seeking learning from all reports received via our safeguarding channels. We will always follow up to ensure agreed actions are implemented and reviewed, and take all steps possible to make certain that those who come into contact with Tearfund are protected from harm.

36 . Annual Report and Financial Statements 2021/22

Diversity and inclusion report

Diversity and inclusion report

——

At Tearfund, we believe that every person is created in the image of God. This truth is fundamental to the ways in which we interact with each other and all those we serve – regardless of their background, experience or beliefs.

Broken relationships have led to marginalisation and exclusion, and this is not God’s plan. We are committed to ensuring diversity and inclusion remain at the heart of Tearfund’s work, creating a culture where people feel they belong – for both our staff and the communities we serve around the world.

The Board has continued to take steps to seek a diverse range of candidates as they recruit new trustees. The latest appointment to the Board is a leader within the Black Majority Church in the UK. He brings significant expertise and experience that will help ensure we not only diversify representation but also connect with new and emerging audiences. Both these are key to our long-term success.

Key progress in our work this year on diversity and inclusion includes:

Looking ahead, our key commitments to greater diversity and inclusion include:

You can read our Diversity and Inclusion Statement in full at tearfund.org/diversity-inclusion

Disability inclusion

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

Recruitment

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

• Candidates disclose any disability at the application stage. However, to ensure full and fair consideration of their application, this information is only visible to the recruitment team and not to the line manager or other members of the interview panel. Recruiting managers and interview panel members will shortlist candidates for interview based only on their aptitudes and abilities as demonstrated in their application form.

Employment

Tearfund’s Equality, Diversity and Inclusion 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 employment.

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

We have achieved ‘Committed’ status as part of the UK Government’s Disability Confident employer scheme.

Environmental performance report

Annual Report and Financial Statements 2021/22 . 37

Environmental performance report

——

Climate change is hitting people living in poverty the hardest and preventing them from flourishing.

We have a long history of working on environmental issues and our commitment to ‘walk the talk’ around the climate emergency means that we need to keep our carbon footprint as small as possible.

This year, we have:

We continue to explore ways within our current systems and processes to improve our environmental data collection. We have learnt to make better use of technology for things such as meetings, training and conferences, to maintain our relationships and deliver our strategy, and we will continue with some of these practices into the future.

Greenhouse gas emissions and energy-use data for Tearfund UK for the period of 1 April 2021 to 31 March 2022

We have followed the ‘Environmental reporting guidelines: including Streamlined Energy and Carbon Reporting guidance’ (2019), and ‘UK Government greenhouse gas conversion factors for company reporting’ (2021) to produce these figures relating to our carbon footprint in the UK.

----- Start of picture text -----
Unit 2021–22 2020–21 2019–20
Energy consumption Used to calculate the emissions below kWh 346,000 357,000 467,000
Emission sources
Scope 1 Combustion of gas t/CO 2 e 10.3 11.0 17.3
Scope 1 Combustion of fuel for transport purposes t/CO 2 e 0.03 0.1 1.1
Scope 2 Purchased electricity t/CO 2 e 60.7 72.4 99.3
Business travel in rental cars or employee-
Scope 3 owned vehicles where company is t/CO 2 e 9.7 1.5 13.6
responsible for purchasing the fuel
Total gross based on above t/CO2e 80.7 85.0 131.3
Intensity ratio Tonnes of CO 2 e per full-time equivalents t/CO 2 e 0.2 0.2 0.3
----- End of picture text -----*

Energy efficiency action

Emissions this year have remained low because of the restrictions on travel and office access due to Covid-19, which have resulted in reduced energy and fuel consumption.

*There was an error in the energy consumption figures provided for the 2019/20 report which has now been rectified.

38 . Annual Report and Financial Statements 2021/22

Risk management framework

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 we plan to manage and mitigate them.

----- Start of picture text -----
Identified risk Management and 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; weekly corporate
prayers led by staff around the world
• appointment process for trustees, key staff and other representatives includes
exploration of Christian identity
• Theology Team and Board Theology Committee, with strong international
representation and engagement
Safety, security, health & • policies and procedures for Security, and for Health, Safety and Wellbeing
wellbeing: • security training for all international staff and those who travel
loss of life, health, safety or
• country Safety and Security Plans
wellbeing of staff, volunteers or
• Emergency Response and Crisis Response Plans are documented and tested
others under our duty of care
• pastoral and wellbeing care structures and resources; regular communications
to staff and managers about caring for wellbeing
• dedicated Safety and Security Team, and regional safety and security advisers
• accountabilities and processes for committees of the Board and management
to review risks and mitigations
• specific focus on wellbeing implications of high level of simultaneous change
Safeguarding: • policies, procedures and mandatory annual staff training on Safeguarding and
abuse or other harm of a child on Whistleblowing; regularly reviewed and communicated
or adult-at-risk • independent reporting hotline is 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
• 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 Design Approval process
failure to deliver on key • country office accreditation scheme to identify country offices with the capacity
outcomes of a high-profile to implement large donor grants
donor-funded project
• monthly reviews of progress are made on donor-grant spending
• 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: • healthy reserves position; reserves policy and position are reviewed regularly
large unexpected shortfall • annual budget set to maintain adequate reserves to cover key risks to income
in unrestricted income, or and costs
unexpected cost
• management accounts are reviewed monthly by Executive Team and Board
officers, and quarterly by the Board
• diversified and reliable income sources from long-term and new supporters
and donors
----- End of picture text -----

Risk management framework

Annual Report and Financial Statements 2021/22 . 39

----- Start of picture text -----
Identified risk Management and mitigation
Impact: • Board International Impact Committee
not measuring or demonstrating • dedicated Impact and Effectiveness Team, and regional/country office roles
impact in our work adequately
• corporate strategic dashboard used by Executive Team and Board to track key
performance indicators and our impact
• design, monitoring and evaluation system is used for all projects and programmes
• independent research and meta-studies are used to validate and enhance our
impact across our corporate priorities
• corporate and country strategy processes are used to align work and outcomes
with corporate priorities and impact objectives
Sanctions and terrorism: • policies and procedures on Financial Sanctions, Controls, Anti-Money
our funds are used by a Laundering, and Anti-Terrorism
sanctioned party, or for • enhanced due diligence procedures for high-risk countries
the purposes of terrorism
• partner capacity assessments cover policies and training on countering
terrorism; partners are required to make their staff aware of risks, and report
any concerns, suspicions or incidents
IT security: • policies on Data Protection and Information Security
inadequate cybersecurity and/or • mandatory regular staff training on cybersecurity
protection of personal data
• real-time back-ups of all core systems are held in secure off-site data centre,
including cold storage of core databases
• data protection officer and Data Protection Group actively provide oversight
and training
Financial wrongdoing: • policies on Fraud, Bribery, Corruption, and Conflicts of Interest
corruption, fraud, bribery or • mandatory regular staff training on fraud awareness, anti-bribery and
conflict of interest involving corruption, conflicts of interest, and whistleblowing
our staff or partners
• partner assessments and partner capacity development plans are designed to
help partners enhance their 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
Environmental impact: • Environmental and Economic Sustainability (EES) corporate priority, with
our activities have negative associated objectives, global and local advocacy work, small and large projects,
environmental impacts, and dedicated supporting roles across the organisation
insufficient resilience to • comprehensive Environmental Policy, with targets for reducing our own
environmental change, or fail to environmental impacts
achieve changes to environmental
• Quality Standards for our work include commitments on environmental impact,
policies and practices
risks, resilience and adaptation to climate change
• the ‘Walk the Talk’ group to champion environmental conduct consistent with
our public stances on environmental care and justice
• project proposals are required to address environmental design and impact
• signatory to the Climate and Environment Charter for Humanitarian
Organisations
----- End of picture text -----

40 . Annual Report and Financial Statements 2021/22

Trustees, Members & Ambassadors

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

Board of Trustee Directors

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:

Anna Laszlo[1] (Chair) Stephanie Biden (Deputy Chair) Antony Barnes (Treasurer from October 2021)

Jayakumar Christian

Ian Curtis (until October 2021) John Davidson (also a director of Tearfund USA)

Catherine De Souza (from September 2021) Sally Jones-Evans Rt Rev Harold Miller (until October 2021) Jean Paul Ndagijimana Rosemary Nuamah Williams Yemi Odusolu (from January 2022) Harry Phinda John Shaw (Treasurer until October 2021) David Wesson

Committee members

Details up to 31 March 2022. The Board recruits individuals with specific expertise to sit on sub-committees of the Board.

Audit, Risk and Finance Committee

Antony Barnes (Chair from October 2021) John Shaw (Chair until October 2021) Anna Beck Stephanie Biden (until May 2021) John Davidson (from May 2021) Steve Foster

Robert Hardy Joseph Kariuki Gordon McKechnie (until October 2021) Rosie Slater-Carr

Diversity and Inclusion Committee Formed in June 2021

Anna Laszlo (Chair) Stephanie Biden Harry Phinda

Global Fundraising and Communications Committee

David Wesson (Chair) Hilary Croft (until November 2021) John Davidson Catherine De Souza (from September 2021) Sarah Douglas (from November 2021) Yemi Odusolu (from January 2022) Harry Phinda Simon Poole

International Impact Committee

Sally Jones-Evans (Chair) Adelaide Addo-Fening (from July 2021) Ian Curtis (until October 2021) Joanna de Berry Fi McLachlan Jean Paul Ndagijimana Adam Taylor Fletcher Tembo Rosemary Nuamah Williams (until May 2021)

Safeguarding Committee

Stephanie Biden (Chair) Ian Curtis (until October 2021)

John Davidson (until May 2021) Rosemary Nuamah Williams (from May 2021)

Theology Committee

Jayakumar Christian (Chair) Stafford Carson Catherine De Souza (from September 2021)

Rosalee Ewell Jim Ingram Rt Rev Harold Miller (until October 2021) Esther Mombo (from September 2021) Dr Elaine Storkey (until December 2021)

The Well Committee

This committee was formed in January 2022 and all members joined on this date.

Yemi Odusolu (Chair) Ayo Afolabi Emmanuel Asuquo Lotwina Farodoye Theo Mathias-Nwaulune Ladun Omideyi Claudine Reid Pam Thompson David Wesson

Members of the Council

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:

Mark Andrews (until January 2022) Robert Camp Gary Carpenter Steve Clifford

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

Annual Report and Financial Statements 2021/22 . 41

Trustees, Members & Ambassadors

Ian Curtis

Dominic De Souza (from Jan 2022) Dr Elizabeth Corrie Graham Fairbairn Paul German Richard Gough Jenny Honey (from June 2021) Kim Hurst Anne de Leyser Fiona Major Clive Mather Gordon McKechnie Philip McMillan Harold Miller Helen Mills (from November 2021) Julia Ogilvy Rt Rev Anthony Poggo John Shaw Michael Stewart Mark Thompson Rev Dr Chris Wright

National Advisory Committee members

Northern Ireland

Helen Mills (from June 2021, Chair from November 2021)

Phillip McMillan (until January 2022, Chair until November 2021) Paul Coulter (until September 2021) Johnny Currie (from June 2021) Denise Hayward Naomi McClelland (from June 2021) Susie McCollough Robin McCormick (from June 2021) Laura McFarland (from June 2021) Laura Nelson (from June 2021)

Scotland

Jenny Honey (Chair from June 2021) Richard Atkinson

Chris Gbenle (from May 2021) Dez Johnston (from May 2021) Fiona Morrison Ellyn Oliver Stephen Prem (from May 2021)

Wales

Dominic De Souza (Chair from January 2022) Mark Andrews (Chair until January 2022) Simeon Baker (until January 2022) Andy Bull (until January 2022) Owain Edwards (from January 2022) Edwin Egede (from January 2022) Lois Franks (from January 2022) Cadi Gwyn (from January 2022) Iwan Robb (from January 2022) Bethan Sharpe (from May 2022)

Ambassadors

Rev Celia Apeagyei-Collins Guvna B Peter Chambers Anne Coles Rev John Coles Martha Collison Liz Earle Pete Greig Tamsin Greig David Gyasi Lord Michael Hastings Tom Herbert Rev Siew-Huat Ong Ruan Pienaar Marvin Rees (from January 2022)

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

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 (until July 2021)

Veena O’Sullivan International Director (from July 2021)

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

Photos: Sanjeev Bhanja/Tearfund (Nigel Harris), Will Boase/Tearfund (Liz Earle), Chris Hoskins/Tearfund (Martha Collinson and Will Torrent)

42 . Annual Report and Financial Statements 2021/22

Financial review

Financial review

Income and expenditure

Tearfund’s total income for 2021/22 was £79.5m, down by 2% against the prior year figure of £81.4m, but nevertheless another encouraging result for a year during which the pandemic continued to cause a high level of economic uncertainty. It is particularly pleasing that unrestricted donations (excluding legacies and grants) increased by £1.7m (6%) to £29.2m. The generosity of our supporters also led to an increase in income from emergency appeals (including from DEC funds) of £3.7m (67%) to £9.1m in response to the crises in Afghanistan and Ukraine, as well as to the various global impacts of Covid-19. Income from institutional grants was down by £2.2m (8.5%) at £23.9m, mainly due to reduced US Government funding.

Total expenditure of £76.9m was slightly below the 2020/21 level of £77.8m. Our budget for 2021/22 built in caution about future income levels, but continuing strong performance during the year enabled the Board to approve additional expenditure of over £3m directed towards strategic priority areas and country programming. These additional commitments represent projects which will continue to be implemented in 2022/23.

Net income for the year is £2.6m (2020/21: £3.6m), made up of a positive timing difference of £4.6m on restricted funds and a planned deficit of £2.0m on unrestricted funds.

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.

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 partner’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. A list of the top 50 partner organisations we made grants to are on our website at tearfund.org/top50

Reserves – 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 2022/23, unchanged from 2021/22.

At the end of 2021/22 our general fund stands at £11.5m (2020/21: £9.6m), which is above the upper end of the target range. However, it should be noted that this includes £4.9m of accrued legacy income, where the timing of the actual cash receipts is uncertain. Even so, this enables us to plan with confidence for 2022/23 and continue to direct funds towards our corporate priority areas of Church and Community Transformation, Environmental and Economic Sustainability, and Fragile States, as well as to respond to emergencies and to complete the strategic projects approved in 2021/22 as mentioned in the above section on expenditure.

Designated funds

Designated funds are part of the unrestricted funds which the Trustee Directors have earmarked for a particular use. This designation does not represent a legal restriction. The Fixed Asset Fund represents the net book value of Tearfund’s fixed assets to indicate that these resources are not available for other purposes. At the end of the year, the Fixed Asset Fund stood at £1.2m (2020/21: £1.6m).

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 £2.2m (2020/21: £5.5m).

Restricted funds

Restricted funds are subject to specific conditions imposed by donors. 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 are either institutional awards, or funds generated during emergencies or as a result of other specific appeals. In many cases these appeals generate income over a short timeframe which is then planned to be spent over a period of up to three years in line with the purpose of the appeal. At the end of the year, total restricted funds had increased to £17.4m (2020/21: £12.8m). The increase is mainly due to income received for emergency appeals relating to Afghanistan, Ukraine and Democratic Republic of Congo. For each fund, Tearfund’s assets are available and adequate to fulfil its obligations.

Financial review

Annual Report and Financial Statements 2021/22 . 43

Financial risk management

At the start of the pandemic in March 2020, we identified a 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. Where considered appropriate, we have kept these measures in place, recognising that heightened risks to income remain in the current environment of high inflation.

Receivables relate mainly to major governmental and institutional donors, legacy income, and recoverable tax. 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. Additional liquidity was provided by a £6m credit facility secured against the Teddington building, but we took the view this was no longer required and it was cancelled in December 2021. We continue to own the building and are confident that the facility could be reinstated if necessary. Tearfund receives income mainly in sterling pounds and US dollars. Foreign exchange risk affects Tearfund mainly by impacting the purchasing power of donor funds in the countries where most of our charitable expenditure is incurred. 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 fixedterm or call deposits. During the year Tearfund’s sterling deposits achieved an average rate of interest of 0.17% (2020/21: 0.37%) compared with an average bank base rate for the same period of 0.19% (2020/21: 0.10%).

Where your money goes

----- Start of picture text -----
Churches
11p 10p mobilised
Emergency
needs met
13p
Communities
transformed
31p
10p Society
changed
Fundraising
25p
Support and
running costs
One Pound
----- End of picture text -----

----- Start of picture text -----
Income
£0.3m
£9.1m
General donations £46.2m
Government grants £23.9m
Emergency appeals £9.1m
£23.9m Total income Other income £0.3m
£79.5m
Total income £79.5m
£46.2m
----- End of picture text -----

----- Start of picture text -----
44 . Annual Report and Financial Statements 2021/22
Claudine, 38, is a teacher, farmer and church
leader in Rwanda. She bought a piglet with a loan
she had received from her self-help group
Photo: Tumuheirwe Jesus/Tearfund
----- End of picture text -----

Trustee Directors’ responsibility statement

Annual Report and Financial Statements 2021/22 . 45

Trustee Directors’ responsibility statement

Trustee Directors’ responsibilities

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.

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

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.

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.

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:

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

Anna Laszlo Chair 29 July 2022

46 . Annual Report and Financial Statements 2021/22

Independent auditor’s report

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 2022 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We remain 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.

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

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: Chair’s Introduction, CEO’s Introduction, A united voice on climate justice 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:

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;

Independent auditor’s report

Annual Report and Financial Statements 2021/22 . 47

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 determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the 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:

48 . Annual Report and Financial Statements 2021/22

Independent auditor’s report

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:

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

29 July 2022

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

frc.org.uk/auditorsresponsibilities

This description forms part of our auditor’s report.

Financial statements

Annual Report and Financial Statements 2021/22 . 49

Consolidated statements of financial activities (incorporating an income and expenditure account) Year ended 31 March 2022

----- Start of picture text -----
2022 2021
Unrestricted Restricted Total Unrestricted Restricted Total
funds funds funds funds funds funds
Note £’000 £’000 £’000 £’000 £’000 £’000
Income from:
Donations and legacies 2 34,742 44,405 79,147 33,242 47,174 80,416
Charitable activities 3 257 11 268 836 1 837
Other trading activities 5 1 26 27 15 39 54
Investment income 32 - 32 60 - 60
Total income 35,032 44,442 79,474 34,153 47,214 81,367
Expenditure on:
Raising funds 4 11,617 1,010 12,627 10,399 819 11,218
Charitable activities 4 25,403 38,884 64,287 21,763 44,775 66,538
Total expenditure 37,020 39,894 76,914 32,162 45,594 77,756
Net (expenditure)/income for the year 6 (1,988) 4,548 2,560 1,991 1,620 3,611
Transfer between funds 14 (53) 53 - 132 (132) -
Net movement in funds (2,041) 4,601 2,560 2,123 1,488 3,611
Reconciliation of funds:
Total funds brought forward at 1 April 14b 16,837 12,832 29,669 14,714 11,344 26,058
Total funds carried forward at 31 March 14a 14,796 17,433 32,229 16,837 12,832 29,669
----- End of picture text -----

The result for the year for Companies Act 2006 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 income for the financial year stated above and its historical cost equivalent. The turnover of the company for the year was £79,447,000 (2020/21: £81,313,000). The net result of the company for the year was a surplus of £2,560,000 (2020/21: surplus of £3,611,000). There is no material difference between the entity and the group Statement of Financial Activities.

50 . Annual Report and Financial Statements 2021/22

Financial statements

Balance sheets As at 31 March 2022

----- Start of picture text -----
Tearfund Group Tearfund
2022 2021 2022 2021
Note £’000 £’000 £’000 £’000
Fixed assets
Tangible assets 9 1,164 1,583 1,164 1,583
Long-term investments 10 - - 5 5
Total fixed assets 1,164 1,583 1,169 1,588
Current assets
Stocks 11 616 882 604 871
Debtors 12 9,723 8,960 9,732 8,977
Short-term deposits 18,765 14,460 18,765 14,460
Cash at bank and in hand 7,014 7,695 7,010 7,674
Total current assets 36,118 31,997 36,111 31,982
Creditors
Amounts falling due within one year 13 (5,053) (3,911) (5,051) (3,901)
Net current assets 31,065 28,086 31,060 28,081
Net assets 32,229 29,669 32,229 29,669
Funds
Unrestricted funds:
General fund 14a 11,475 9,626 11,475 9,626
Designated funds 14a 3,321 7,211 3,321 7,211
14,796 16,837 14,796 16,837
Restricted funds 14a 17,433 12,832 17,433 12,832
Total funds 32,229 29,669 32,229 29,669
----- End of picture text -----

The financial statements on pages 49 to 68 were approved by the Board of Directors on 29 July 2022 and signed on its behalf by:

Anna Laszlo Chair of the Board

Antony Barnes Treasurer

Financial statements

Annual Report and Financial Statements 2021/22 . 51

Consolidated cash flow statement Year ended 31 March 2022

----- Start of picture text -----
2022 2021
£’000 £’000
Net cash provided by operating activities (see below) 3,784 4,700
Cash flow from investing activities:
Investment income received 32 60
Purchase of property, plant, equipment and intangibles (192) (139)
Net cash used in investing activities (160) (79)
Change in cash and cash equivalents in the reporting period 3,624 4,621
Cash and cash equivalents at the beginning of the reporting period 22,055 17,434
Cash and cash equivalents at the end of the reporting period 25,679 22,055
Reconciliation of net income to net cash flow from operating activities
Net income for the reporting period (as per the statement of financial activities) 2,560 3,611
Adjustments for :
Depreciation charges 610 1,033
Investment income receivable (32) (60)
Loss on sale of tangible fixed assets 1 -
Decrease in stocks 266 398
(Increase)/decrease in debtors (763) 1,131
Increase/(decrease) in creditors 1,142 (1,413)
Net cash provided by operating activities 3,784 4,700
1 April 31 March
2021 Cashflows 2022
Analysis of changes in net funds £’000 £’000 £’000
Cash at bank and in hand 7,695 (681) 7,014
Bank deposits 14,460 4,305 18,765
Interest-free loans (100) - (100)
22,055 3,624 25,679
----- End of picture text -----

52 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

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 year-end there were 36 members (2020/21: 34) who were each liable to contribute £1 in the event of the company being wound up.

The 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 in restricted funds is shown separately in the SoFA and analysed into the main components in note 14.

Going concern

The Financial Review on pages 42 to 43 sets out Tearfund's encouraging financial performance in 2021/22 in respect of income and reserves, which enabled us to release additional funds for strategic priority areas on three separate occasions during the year with a total value of over £3m. Showing similar confidence, the Board decided that the two-year £6m credit facility, put in place in August 2020 to protect against short-term liquidity issues and secured against our Teddington building, was no longer required and it was cancelled in December 2021.

We recognise that both in the UK and globally this continues to be a time of high uncertainty and volatility marked by conflict, food shortages, cost of living increases and for some countries the continuing impact of the Covid-19 pandemic. Taking this into account, the annual review of reserves policy concluded that the target range for the general fund should be held at £7m–£10m (previously £4.5m–£6.5m, it was increased to the current level in March 2020 at the start of the pandemic).

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

• just as the anticipated fall in income during 2020/21 did not materialise, in 2021/22 total income and unrestricted donations once again outperformed their budgets for the year. We remain very grateful for the loyalty of our supporters and the ability and agility of our fundraising teams. Our income budgets continue to seek to balance caution with an appropriate level of ambition

In support of the going concern assessment, we have prepared cash flow forecasts for the next twelve months which are based on the approved 2022/23 budget and three-year plan. We have run stress tests on these forecasts to evaluate the impact of unexpected falls in income. We review income in detail on a monthly basis to identify any downward trends as early as possible, keeping in mind the options of delaying expenditure or making cost reductions if necessary. 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. 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. No value is included where the legacy is contentious or is subject to a life interest held by another party.

Financial statements

Annual Report and Financial Statements 2021/22 . 53

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. Goverment grants relating to the furlough scheme have been recoginised in the income statement when received.

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 is 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 fund raising costs 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. Resulting gains or losses are included in the SoFA.

Pensions

Tearfund operates two defined contribution pension schemes. Contributions are charged to the SoFA as they become payable and invested on behalf of the employees. An overseas staff member can have, a % of the salary paid into a pension fund or a % of the salary is paid directly to the staff member, and they take responsibility for their own pension arrangements and investment. The % paid depends on the time when empoyees joined Tearfund and empoyees age. In some coutries the % is defined in legislation.

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, except laptops which are capitalised regardless of value. Assets held overseas (other than laptops) are expensed. 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 land
Freehold buildings		 Nil
20–50 years		 Nil
20–50 years
Fixtures, fttings and equipment
including computers
Motor vehicles		 3–20 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 5 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.

Other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due. Creditors and provisions are recognised where Tearfund has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.

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 donated to Tearfund are valued at cost, based on donor's valuation or deemed market value, 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 (32–95 days) 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.

54 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

2a. DONATIONS

----- Start of picture text -----
Unrestricted Restricted 2022 Unrestricted Restricted 2021
funds funds Total funds funds funds Total funds
Note £’000 £’000 £’000 £’000 £’000 £’000
Donations from:
Individuals 26,829 6,291 33,120 25,199 10,435 35,634
Churches 1,422 949 2,371 1,170 1,413 2,583
Trusts, companies and schools 986 3,921 4,907 1,150 4,048 5,198
Legacies 5,493 269 5,762 5,306 151 5,457
Grants 2b 12 23,862 23,874 417 25,683 26,100
34,742 35,292 70,034 33,242 41,730 74,972
Appeals and emergencies:
Individuals - 5,307 5,307 - 3,798 3,798
Churches - 873 873 - 311 311
Trusts, companies and schools - 497 497 - 147 147
Legacies - 47 47 - - -
- 6,724 6,724 - 4,256 4,256
Via Disasters Emergency Committee - 2,389 2,389 - 1,188 1,188
- 9,113 9,113 - 5,444 5,444
Total donations and legacies 34,742 44,405 79,147 33,242 47,174 80,416
----- End of picture text -----

Gifts in kind of £77,000 (2020/21: £36,200) of pro-bono legal and consultancy work is included in support cost expenditure. Of this, £1,000 (2020/21: £nil) is included above in 'Individuals' and £76,000 (2020/21: £36,200) is in 'Trusts, companies and schools' income.

Financial statements

Annual Report and Financial Statements 2021/22 . 55

Notes to the financial statements 31 March 2022

2b. GRANTS INCOME

----- Start of picture text -----
2022 2021
£’000 £’000
United States Government 7,157 11,405
United Nations 3,416 3,015
United Kingdom Government 2,329 3,612
Dutch Government 1,751 2,833
Danish Government 873 838
European Union 841 (2)
Canadian Foodgrains Bank (including Tearfund Canada) 825 776
Norwegian Government 731 404
Canadian Government 674 -
Scottish Government 540 513
States of Jersey 233 -
New Zealand Government 81 105
Other 14 -
States of Guernsey - 50
Belgian Government - 5
19,465 23,554
Tear Netherlands (includes funding from the Evangelical Broadcasting Co.) 4,032 2,300
Integral/Other NGOs 377 246
23,874 26,100
----- End of picture text -----

Included within the above grants income are gifts in kind of £756,000 (2020/21: £1,023,000) 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 from the United Kingdom Government is £6,000 (2020/21: £417,000) unrestricted income related to the furlough scheme.

Included within grants income from Tear Netherlands is £6,000 (2020/2021: £nil) of unrestricted grants.

3. CHARITABLE ACTIVITIES

Unrestricted
funds
£’000

Restricted
funds
£’000

2022
Total funds
£’000

2021
Total funds
£’000
Contract income contributed to the following programmes:
ABT associates (CCT projects in Papua New Guinea) 165
-
165
-
SWIFT (water, sanitation and hygiene in the Democratic Republic of Congo) -
-
-
800
Total contract income 165
-
165
800
Other income from charitable activities 92
11
103
37
Total income from charitable activities 257
11
268
837

The 2020/21 income of £837,000 was unrestricted, except for £1,000 of restricted income included in ‘Other income from charitable activities’.

56 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

4. TOTAL RESOURCES EXPENDED

----- Start of picture text -----
Direct Support 2022 2021
Grants costs costs Total costs Total costs
£’000 £’000 £’000 £’000 £’000
Unrestricted
Costs of generating funds:
Costs of fund raising 275 8,917 2,422 11,614 10,389
Fundraising trading - 3 - 3 10
275 8,920 2,422 11,617 10,399
Charitable activities:
Churches mobilised 1,107 2,845 925 4,877 4,487
Emergency needs met 936 3,034 2,045 6,015 4,703
Communities transformed 2,103 4,552 1,831 8,486 7,277
Society changed 1,022 3,820 1,183 6,025 5,296
5,168 14,251 5,984 25,403 21,763
Total unrestricted 5,443 23,171 8,406 37,020 32,162
Restricted
Costs of generating funds:
Costs of fund raising 105 880 1 986 792
Fundraising trading - 24 - 24 27
105 904 1 1,010 819
Charitable activities:
Churches mobilised 1,814 1,722 - 3,536 3,896
Emergency needs met 6,512 13,070 1 19,583 23,772
Communities transformed 5,121 7,331 1 12,453 14,194
Society changed 1,727 1,585 - 3,312 2,913
15,174 23,708 2 38,884 44,775
Total restricted 15,279 24,612 3 39,894 45,594
Total expenditure 20,722 47,783 8,409 76,914 77,756
----- End of picture text -----

Costs are allocated between the four charitable activities according to each programme’s principle aims. Cost allocation includes an element of judgement and Tearfund has considered the cost-benefit of detailed calculations and record-keeping in calculating a best estimate of the attributable costs.

Financial statements

Annual Report and Financial Statements 2021/22 . 57

Notes to the financial statements 31 March 2022

4. TOTAL RESOURCES EXPENDED CONTINUED

----- Start of picture text -----
2022 2021
£’000 £’000
Grants to partner organisations by geographical region:
Africa 10,048 10,325
Eurasia 4,663 2,940
Asia 4,198 3,575
Latin America and Caribbean 1,095 1,388
Europe 85 -
Total grants to partner organisations 20,089 18,228
Assistance in establishing Tearfund USA 633 563
Total grants 20,722 18,791
----- End of picture text -----

Grant management costs were £2,332,000 (2020/21: £1,772,000).

----- Start of picture text -----
2022 2021
The top 15 countries and regions where grants were made: £’000 £’000
Ethiopia 2,035 1,301
South Sudan 1,656 814
India 1,270 682
D.R. Congo 1,230 1,198
Bangladesh 1,211 977
Nigeria 1,197 1,076
Afghanistan 1,059 585
Rwanda 857 845
Yemen 698 963
Mozambique 584 467
Mali 531 523
Nepal 500 498
Zimbabwe 499 475
Burundi 495 672
Malawi 474 577
----- End of picture text -----

The top 50 partner organisations receiving grants can be found at: tearfund.org/top50

Support costs and the basis of
their allocation are as follows:
Principal basis of
allocation to activities		 2022
£’000		 2021
£’000
General management, risk and compliance
Headcount and expenditure		 467 439
Financial management
Headcount and expenditure		 1,523 1,487
Human resources
Headcount		 2,080 1,985
Strategy & Impact
Expenditure		 269 213
Information systems
Headcount and expenditure		 2,724 3,017
Premises and facilities
Headcount		 992 1,355
Governance
Headcount and expenditure		 354 340
8,409 8,836

58 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

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. All its profits are gifted to Tearfund under a Deed of Covenant. Its results and assets for the year ended 31 March 2022 were as follows:

----- Start of picture text -----
2022 2021
£’000 £’000
Total incoming resources 27 54
Total expenditure (27) (37)
Profit for the year - 17
Qualifying distribution - (17)
Retained profit/loss for the year - -
Total assets 18 32
Total liabilities (13) (27)
Funds 5 5
----- End of picture text -----

In 2021/22, £2,000 (2020/21: £12,000) of profits were restricted and £2,000 were unrestricted losses (2020/21: profit of £5,000).

6. NET INCOME FOR THE YEAR

6. NET INCOME FOR THE YEAR
2022 2021
Net income for the year is stated after charging the following: £’000 £’000
Depreciation of tangible fxed assets
Depreciation of intangible fxed assets
Auditors' remuneration – Tearfund
Auditors' remuneration – Tearfund Trading
Loss on sale of tangible fxed assets
Operating leases: land and buildings – unrestricted
Operating leases: land and buildings – restricted		 610
-
66
3
1
60
931		 1,015
18
67
3
-
60
1,008

The above is all unrestricted expenditure unless otherwise indicated.

7. EMPLOYEES AND TRUSTEES

Employee costs 2022
UK
£’000

2022
Overseas
£’000

2022
Total
£’000

2021
UK
£’000		 2021
Overseas
£’000

2021
Total
£’000
Salaries and wages 15,605
12,124
27,729
16,310		 12,702
29,012
Employee benefts 7
468
475
33		 516
549
Social security costs 1,593
52
1,645
1,581		 64
1,645
Other pension costs 1,633
225
1,858
1,348		 185
1,533
18,838
12,869
31,707
19,272		 13,467
32,739

Included in the above employee costs are redundancy and severance costs of £61,000 (2020/21: £248,000). Redundancy costs are provided for when the decision has been made and the employees have been informed, and the amounts could be calculated with reasonable accuracy and the settlement is probable in the next financial year.

Financial statements

Annual Report and Financial Statements 2021/22 . 59

Notes to the financial statements 31 March 2022

7. EMPLOYEES AND TRUSTEES CONTINUED

Average number of persons employed during the year 2022
Number		 2021
Number
UK-contracted employees based:
In the UK 447
461
Overseas 98
111
545
572
Staff based overseas on local contracts 543
665
1,088
1,237

UK staff includes those personnel based at Tearfund’s head office in Teddington together with those based at regional offices in the UK and those working from home. 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
2022 2021
Number
£60,001 – £70,000
19
£70,001 – £80,000
7
£80,001 – £90,000
4
£90,001 – £100,000
1
£140,001 – £150,000
1		 Number
13
3
5
1
1

The two highest paid individuals in the 2022 and 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 £182,000 (2020/21: £130,000) were made for these thirty two (2020/21: twenty three) higher-paid employees. The total emoluments received by the chief executive in the year was £87,000 (2020/21: £90,000). In 2021/22 the senior executives of the organisation earned a total of £669,000 (2020/21: £650,000) including national insurance and pensions.

Trustees

As Charity Trustees, the Board of Directors and Committee Members, who are not employees, received no remuneration for their services. During the year, four directors/committee members were reimbursed or had costs paid for by Tearfund for a total of £596 for UK travel and subsistence expenses (2020/21: two for £534). Two directors/committee members had overseas travel of £1,196 paid for by Tearfund (2020/21: none).

Indemnity insurance is provided for the Trustee Directors at a cost of £22,000 (2020/21: £11,000).

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 £333,000 (2020/21: £249,000) in respect of pension contributions due to be paid to the fund managers.

60 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

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. Tearfund Trading Limited pays no tax on its taxable profits as they are all gifted to Tearfund under a Deed of Covenant.

9. TANGIBLE AND INTANGIBLE FIXED ASSETS

----- Start of picture text -----
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 2021 2,688 6,305 109 9,102 1,225
Additions - 192 - 192 -
Disposals - (119) - (119) -
At 31 March 2022 2,688 6,378 109 9,175 1,225
Accumulated depreciation
At 1 April 2021 1,840 5,603 76 7,519 1,225
Charge for the year 76 517 17 610 -
Disposals - (118) - (118) -
At 31 March 2022 1,916 6,002 93 8,011 1,225
Net book value
At 31 March 2022 772 376 16 1,164 -
At 31 March 2021 848 702 33 1,583 -
----- End of picture text -----

The book value of freehold land not depreciated is £200,000 (2020/21: £200,000). Tearfund’s offices in Teddington have a book value of £772,000 (2020/21: £848,000) and are insured at a value of £10,000,000 (2020/21: £10,000,000). From 1 April 2022, the insurance value has been increased to £11,000,000.

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

10. LONG-TERM INVESTMENTS

10. LONG-TERM INVESTMENTS 2022
£’000
2021
£’000
2022
£’000
2021
£’000
Tearfund Group
Tearfund
Unquoted investment in subsidiary -
-
5
5

At 31 March 2022, 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

Financial statements

Annual Report and Financial Statements 2021/22 . 61

Notes to the financial statements 31 March 2022

11. STOCKS 2022
£’000
2021
£’000
Tearfund Group		 2022
£’000
2021
£’000
Tearfund Group
2022
£’000
2021
£’000
Tearfund
2022
£’000
2021
£’000
Tearfund
Goods held for distribution to communities 593
860
593
860
Goods for resale 12
11
-
-
Disaster management and IT stores 11
11
11
11
616
882
604
871

12. DEBTORS

----- Start of picture text -----
Tearfund Group Tearfund
2022 2021 2022 2021
Due within one year: £’000 £’000 £’000 £’000
Amount owed by group undertaking - - 9 17
Tax recoverable 867 679 867 679
Other debtors 538 1,006 538 1,006
Accrued institutional grants 2,324 2,515 2,324 2,515
Accrued legacy income 4,935 3,787 4,935 3,787
Prepayments and other accrued income 1,059 973 1,059 973
9,723 8,960 9,732 8,977
13. CREDITORS
Tearfund Group Tearfund
2022 2021 2022 2021
Amounts falling due within one year £’000 £’000 £’000 £’000
Interest-free loans 100 100 100 100
Other creditors 1,978 1,219 1,978 1,217
Taxation and social security 1,361 1,190 1,362 1,190
Accruals 1,605 1,397 1,602 1,389
Deferred income 9 5 9 5
5,053 3,911 5,051 3,901
----- End of picture text -----

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

Deferred income balance 2022
£’000
2021
£’000		 2022
£’000
2021
£’000
Opening balance 5
448
Released income (5)
(445)
Deferred income 9
2
Closing balance 9
5

62 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

14a. FUNDS MOVEMENT (2021/22)

----- Start of picture text -----
1 April 31 March
2021 Income Expenditure Transfers 2022
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
General fund 9,626 35,032 (33,674) 491 11,475
Designated funds
Fixed asset fund 1,583 - - (419) 1,164
Overseas assets fund 125 - - (125) -
Strategic priorities 5,503 - (3,346) - 2,157
7,211 - (3,346) (544) 3,321
Total unrestricted funds 16,837 35,032 (37,020) (53) 14,796
Restricted funds
Appeals and emergencies:
Afghanistan - 3,567 (894) 1 2,674
Bangladesh 614 13 (3) (316) 308
Burundi and Rwanda 89 - (71) - 18
Central African Republic 75 - (75) - -
Coronavirus Emergency Appeal 667 1,797 (2,219) - 245
Democratic Republic of Congo - 1,183 (613) - 570
East Africa - 2 (2) - -
Haiti - 123 (97) - 26
Indonesia 579 1 (188) - 392
Middle East 961 109 (128) - 942
Myanmar 77 - (53) - 24
Other 239 300 (173) - 366
Pakistan 90 - - - 90
Southern Africa cyclone 337 1 (300) (38) -
Sudan and South Sudan 181 11 (70) 316 438
Syria crisis 640 79 (117) 9 611
Ukraine - 1,772 (144) - 1,628
Yemen 1,801 155 (15) - 1,941
6,350 9,113 (5,162) (28) 10,273
----- End of picture text -----

Financial statements

Annual Report and Financial Statements 2021/22 . 63

Notes to the financial statements 31 March 2022

14a. FUNDS MOVEMENT (2021/22) CONTINUED

----- Start of picture text -----
1 April 31 March
2021 Income Expenditure Transfers 2022
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
Restricted funds brought forward 6,350 9,113 (5,162) (28) 10,273
Country funds 2 136 (138) - -
Project funds:
Institutions and trusts 5,183 30,041 (28,864) 34 6,394
Connected Church 274 (20) (231) (5) 18
Other 698 2,413 (2,687) 324 748
Beneficiary funds:
Children - 223 (269) 46 -
Issue funds:
Disaster management - 1,046 (1,046) - -
Water and sanitation - 1,294 (1,301) 7 -
HIV and AIDS 325 30 (30) (325) -
Waste Management - 166 (166) - -
Total restricted funds 12,832 44,442 (39,894) 53 17,433
Total 29,669 79,474 (76,914) - 32,229
----- End of picture text -----

Designated funds are set up for the following purposes:

Restricted funds are shown under the following main categories:

Fund balances may be negative for the following reasons:

At 31 March 2022, the total deficit balances amounted to £148,286 (2020/21: £335,795).

64 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

14a. FUNDS MOVEMENT (2021/22) CONTINUED

Transfers between funds represent:

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

----- Start of picture text -----
1 April 31 March
2021 Income Expenditure 2022
Foreign, Commonwealth and Development Office (FCDO) £’000 £’000 £’000 £’000
Central African Republic: AID Match - 817 (817) -
Haiti: AID Match (15) 325 (246) 64
Pakistan: AID Match 2 467 (471) (2)
FCO & Other:
British Embassy FORD - 30 (30) -
Start Network:
Burkina Faso - 71 (71) -
Burundi flood response - 88 (88) -
Democratic Republic of Congo Volcano Alert 525 - 100 (100) -
Ethiopia IDP response Alert 538 - 220 (220) -
Ethiopia working differently - 15 (15) -
Indonesia earthquake 1 - (1) -
Mozambique 2022 - 99 (96) 3
Nigeria evaluation 3 (3) - -
Nigeria Aug–21 to Sep–21 - 30 (30) -
Rwanda Alert 526 - 65 (65) -
Total FCDO funds (9) 2,324 (2,250) 65
Disasters Emergency Committee (DEC)
Cyclone Idai 2019 6 - (6) -
Coronavirus (65) 1,731 (1,603) 63
Afghanistan crisis - 658 (484) 174
Total DEC funds (59) 2,389 (2,093) 237
----- End of picture text -----

Financial statements

Annual Report and Financial Statements 2021/22 . 65

Notes to the financial statements 31 March 2022

14b. FUNDS MOVEMENT (2020/21)

----- Start of picture text -----
1 April 31 March
2020 Income Expenditure Transfers 2021
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
General fund 3,896 34,153 (29,148) 725 9,626
Designated funds
Fixed asset fund 2,477 - - (894) 1,583
Overseas assets fund (111) - (65) 301 125
Strategic priorities 8,452 - (2,949) - 5,503
10,818 - (3,014) (593) 7,211
Total unrestricted funds 14,714 34,153 (32,162) 132 16,837
Restricted funds
Appeals and emergencies:
Asia floods 14 - (14) - -
Bangladesh 258 892 (540) 4 614
Burundi and Rwanda 238 1 (150) - 89
Central African Republic 194 - (119) - 75
Coronavirus Emergency Appeal - 3,730 (3,051) (12) 667
East Africa 33 3 (36) - -
Indonesia 1,140 2 (563) - 579
Middle East 784 458 (281) - 961
Myanmar 48 62 (33) - 77
Other 101 4 122 12 239
Pakistan 145 - (55) - 90
Southern Africa cyclone 737 343 (741) (2) 337
Sudan and South Sudan 167 18 (4) - 181
Syria crisis 825 76 (261) - 640
Yemen 1,429 862 (490) - 1,801
6,113 6,451 (6,216) 2 6,350
----- End of picture text -----

66 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

14b. FUNDS MOVEMENT (2020/21) CONTINUED

----- Start of picture text -----
1 April 31 March
2020 Income Expenditure Transfers 2021
Tearfund and Tearfund Group £’000 £’000 £’000 £’000 £’000
Restricted funds brought forward 6,113 6,451 (6,216) 2 6,350
Country funds - 108 (96) (10) 2
Project funds:
Institutions and trusts 4,290 31,872 (30,854) (125) 5,183
Connected Church 378 307 (395) (16) 274
Other 563 1,677 (1,558) 16 698
Beneficiary funds:
Other children funds - 2,613 (2,614) 1 -
Issue funds:
Disaster management - 908 (908) - -
Water and sanitation - 2,613 (2,613) - -
HIV and AIDS - 459 (134) - 325
Conflict and poverty - 206 (206) - -
Total restricted funds 11,344 47,214 (45,594) (132) 12,832
Total 26,058 81,367 (77,756) - 29,669
----- End of picture text -----

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

----- Start of picture text -----
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
FCO & 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)
----- End of picture text -----

Financial statements

Annual Report and Financial Statements 2021/22 . 67

Notes to the financial statements 31 March 2022

14b. FUNDS MOVEMENT (2020/21) CONTINUED

1 April
2020
£’000

Income
£’000
Expenditure
£’000
31 March
2021
£’000
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)

15a. ANALYSIS OF NET ASSETS BETWEEN FUNDS (2021/22)

----- Start of picture text -----
Unrestricted Restricted Total
funds funds funds
Fund balances at 31 March 2022 are represented by: £’000 £’000 £’000
Tearfund Group:
Fixed assets 1,164 - 1,164
Current assets 16,167 19,951 36,118
Current liabilities (2,535) (2,518) (5,053)
14,796 17,433 32,229
Tearfund:
Long-term investments 5 - 5
Fixed assets 1,164 - 1,164
Current assets 16,157 19,954 36,111
Current liabilities (2,533) (2,518) (5,051)
14,793 17,436 32,229
15b. ANALYSIS OF NET ASSETS BETWEEN FUNDS (2020/21)
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
----- End of picture text -----

68 . Annual Report and Financial Statements 2021/22

Financial statements

Notes to the financial statements 31 March 2022

16. OPERATING LEASE COMMITMENTS

At 31 March 2022 Tearfund and the Tearfund Group were committed to making the following payments in total in respect of operating leases for land and buildings:


of operating leases for land and buildings:
2022
£’000
2021
£’000
Tearfund Group
2022
£’000
2021
£’000
Tearfund
Within one year 683
719
683
719
In the second to ffth years inclusive 502
481
502
481
1,185
1,200
1,185
1,200

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.

In addition, there were expenditure transfers to Tearfund Trading Limited of £nil (2020/21: £nil) in the year ended 31 March 2022. The balance owing by Tearfund Trading Limited to Tearfund at the end of the year of £9,000 (2020/21: £17,000) 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 2022 there were contracted or authorised capital commitments of £118,000 (2020/21: £nil).

Annual Report and Financial Statements 2021/22 . 69

70 . Annual Report and Financial Statements 2021/22

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

----- Start of picture text -----
XXXXXXX
----- End of picture text -----

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). 00634-(0722)