THE EARMARK TRUST
TRUSTEES’ REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
REGISTERED CHARITY NO: 267176
20746960.1
THE EARMARK TRUST
Report of the Trustees
| Contents | Page |
|---|---|
| Trust Information | 1 |
| Report of the Trustees | 2 - 4 |
| Independent Examiner’s Report | 5 |
| Statement of Financial Activities | 6 |
| Balance Sheet | 7 |
| Notes to the Financial Statements | 8 - 13 |
20746960.1
THE EARMARK TRUST
TRUST INFORMATION
Trustees Alexander Charles Montgomery Raven Frederick Charles Raven Alison Mary Raven (appointed 11 March 2021) Principal office BDB Pitmans LLP One Bartholomew Close, London, EC1A 7BL Bankers Barclays Bank Plc 114 Fenchurch Street London EC3P 3HY Investment Managers Investec Wealth & Investment Limited 30 Gresham Street London EC2V 7QN Administrators BDB Pitmans LLP One Bartholomew Close, London, EC1A 7BL Independent Examiner Sally Knight 1 Coopers Mews, Beckenham, BR3 1AJ
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20746960.1
THE EARMARK TRUST
Report of the Trustees
The Trustees present their report and the unaudited financial statements of the charity for the year ended 5 April 2021.
The annual report and financial statements have been prepared in accordance with the accounting policies set out in notes to the accounts and comply with the Trust’s governing document, the Charities Act 2011 and the relevant provisions of Accounting and Reporting by Charities: Statement of Recommended Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102).
Structure, governance and management
The Earmark Trust was constituted by a Deed of Settlement dated 1 February 1974 between Mr F C Raven and the Trustees. The Objects are: To assist in such ways as the charity trustees in their discretion think fit, in particular but not exclusively to help with disabilities, education, children’s hospitals, and community development. The Trustees are authorised to apply both the capital and income of the Trust for or towards such charitable purposes at such time or times and in such manner as the Trustees shall in their absolute discretion think fit.
The Trustees endeavour to meet twice a year to consider the performance of the investment portfolio, review available reserves for distribution and consider grants payments. However no meetings were possible during 2021.
Charitable activities
In general, grants are made to registered charitable organisations rather than individuals and the Trustees consider applications twice a year.
The Trust property is provided rent free under a licence to occupy to a beneficiary of the Trust (due to financial hardship). The Trust pays the utility costs and the beneficiary pays the council tax, and also contributes approximately £500 a year to the Trust.
Public Benefit Statement
The Trustees confirm that they have referred to the Charity Commission's general guidance on public benefit when reviewing the Trust's objectives and activities and in setting the charity’s activities and grant making policy for the year.
ACHIEVEMENTS AND PERFORMANCE
The Trust’s Funds are held mainly in investments and cash and are all unrestricted. Investment performance is reviewed by the Trustees. During the year the investment portfolio increased in value by £129,017 from £809,185 to £938,202 as per Note 8 (2020: a decrease of £140,799).
FINANCIAL REVIEW
Income
The total income for 2021 was £25,152 (2020: £32,527). This comprised mainly investment and deposit income and other contributions to the Trust property.
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THE EARMARK TRUST
Report of the Trustees
Expenditure
No grants were awarded in 2021 (2020: 39 grants - £23,000). Support costs were £5,924 (2020: £5,912).
There was accommodation expenditure for property held in the Trust of £2,999 (2020: £1,767). The total charitable expenditure for the year was £8,924 (2020: £30,679). Expenditure relating to raising funds (Investment Management fees) was £8,733 (2020: £9,505).
Reserves Policy and Investment policy
The Trustees' policy is to preserve the investment base of the Trust to ensure that sufficient income and capital gains are generated to satisfy budgeted levels of grant and other expenditure. The Trustees intend to resume a more proactive grant-making strategy in 2021/22. They are also looking at the designation of the capital fund. The majority of the charity's funds are in an investment portfolio managed by Investec Wealth & Investment Limited.
Risk Management
The Trustees have examined the strategic and operational risks which the Trust faces.
The major risks to which the Trust is exposed, as identified by the Trustees, have been reviewed and systems and procedures have been established to manage those risks. The Trustees do not enter into commitments in excess of their available cash resources and as a result they operate in a very low risk environment. Any drop in income received will be matched by an appropriate reduction in expenditure.
Going Concern
The Trustees have reviewed the impact of the COVID-19 pandemic on the generation of investment income and considered how this may affect the Trust immediate and longer term activities. The Trustees are satisfied there will be no long-term impact on the going concern of the charity, so continue to adopt the going concern basis for the preparation of the financial statements.
Statement of Trustees’ Responsibilities
Law applicable to charities in England & Wales requires the Trustees to prepare financial statements for each financial year which give a true and fair view of the charity's financial activities during the year and of its financial position at the end of the year. In preparing financial statements giving a true and fair view, the Trustees should follow best practice and:
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select suitable accounting policies and then apply them consistently;
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make judgements and estimates that are reasonable and prudent;
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state whether applicable accounting standards and statements of recommended practice have been followed, subject to any departures disclosed and explained in the financial statements and;
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation.
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20746960.1
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THE EARMARK TRUST
INDEPENDENT EXAMINER’S REPORT TO THE TRUSTEES OF THE EARMARK TRUST
I report to the charity’s Trustees on my examination of the accounts of The Earmark Trust (‘the charity’) for the year ended 5 April 2021 which are set out on pages 6 to 13.
Responsibilities and basis of report
As the charity’s Trustees, you are responsible for the preparation of the accounts in accordance with the requirements of the Charities Act 2011 (‘the 2011 Act’).
I report in respect of my examination of the charity’s accounts as carried out under section 145 of the 2011 Act. In carrying out my examination I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the 2011 Act.
Independent Examiner’s statement
I have completed my examination. I confirm that no matters have come to my attention in connection with my examination giving me cause to believe that in any material respect: (1) accounting records were not kept in respect of the charity as required by section 130 of the 2011 Act; or
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(2) the accounts do not accord with those records; or
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(3) the accounts have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for Accounting and Reporting by Charities applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached.
Use of my report
This report is made solely to the charity’s Trustees, as a body, in accordance with Chapter 3 of Part 8 of the Charities Act 2011. My examination has been undertaken so that I might state to the charity’s Trustees those matters I am required to state to them in an independent examiner’s report and for no other purpose. To the fullest extent permitted by law, I do not accept or assume responsibility to anyone other than the charity and the charity’s Trustees as a body, for my examination, for this report, or for the opinions I have formed.
Sally Knight FCA DChA
Chartered Accountant 1 Coopers Mews, Beckenham, Kent BR3 1AJ
Date:
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20746960.1
THE EARMARK TRUST
STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 5 APRIL 2021
| Notes INCOME AND EXPENDITURE INCOME FROM: Investments Deposit interest Contribution towards property expenses Sale proceeds of motor vehicle Total Income EXPENDITURE ON: Raising funds: Investment management fees Charitable activities Grants 2 Provision of accommodation 3 Support costs 4 Total Expenditure Net income/(expenditure) before investment gains/(losses) Net gains/(losses) on investments 8 Net income/(Expenditure) & Net Movement in Funds Funds brought forward TOTAL UNRESTRICTED FUNDS CARRIED FORWARD |
2021 2020 £ £ 24,562 31,800 30 117 560 560 - 50 Unrestricted funds |
2021 2020 £ £ 24,562 31,800 30 117 560 560 - 50 Unrestricted funds |
|---|---|---|
| 25,152 | 32,527 | |
| 8,733 | 9,505 | |
| - 2,999 5,924 |
23,000 1,767 5,912 |
|
| 8,923 | 30,679 | |
| 17,656 | 40,184 | |
| 7,496 163,028 |
(7,657) (143,411) |
|
| 170,524 960,460 |
(151,068) 1,111,528 |
|
| 1,130,984 £ |
960,460 £ |
The notes on pages 8 to 13 form part of the financial statements
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THE EARMARK TRUST 8ALANCE SHEET AS AT 5 APFUL 2021 2020 Fixed A88•ts Propety, plant and UIpMent Investments 79.599 938.202 80,649 809.185 1,017,801 889.834 Curr•Dt A•s•ts Deposit account Cash held at Invesknent managers Current donation accounts Dobtors and prepayments 88,427 26,503 1,673 62.396 7,035 2,825 3,572 T¢)tsl Curr•nl A8•0ts 120,583 75,828 L•M: Curr•nt Il•bllftl88 Amount• f•lllng du• wlthln one y•ar Credrtors and accwals N•t curr•nt aatr 10 5,202 113,183 70.626 Nat A•••ts 1,130,984 £ 960,460 Funds olth• Tru•t Unre8trict•d Fund• Caprtal fund 12 696.726 6*,725 Accumulated income fijnd 12 434.259 263,735 T¢)tsl Fund• 1.130,984 £ 960,460 The notes on e$ 8 to 13 fomi part of the fnancial statements The financial 8tstements vAre apwoled bythe Trusteoson.............................. ............2022. Aulhori8ed to sign on behaw of the T1.. Aexander Charle¥ M Raven
THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
1. Accounting Policies
1.1. General information and basis of accounting
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (SORP (FRS 102)) second edition (October 2019), the Charities Act 2011, and UK Generally Accepted Accounting Practice as it applies from 1 January 2019.
The Trust does not include a cash flow statement on the grounds that it is a small charity and therefore exempt.
The financial statements have been prepared to give a 'true and fair' view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a 'true and fair view'. This departure has involved following the Charities SORP (FRS 102) issued in October 2019 rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005 which has since been withdrawn.
The Earmark Trust constitutes a public benefit entity as defined by FRS 102. The financial statements are prepared on a going concern basis under the historical cost convention, modified to include certain items at fair value. The financial statements are presented in sterling which is the functional currency of the Trust and rounded to the nearest pound.
The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented.
1.2 Funds
Unrestricted funds comprise those funds which the Trustees are free to use in accordance with the charitable objects. The unrestricted funds are split into a fixed capital account fund (kept to preserve the investment base of the Trust) and an accumulation account fund to which the annual net movement in funds is added. Unrestricted funds may be used at the discretion of the Trustees in furtherance of the general objectives of the charity. There are no restricted funds.
1.3 Income
Income is included in the Statement of Financial Activities (SoFA) when the Trust is legally entitled to the income after any performance conditions have been met, the amount can be measured reliably and it is probable that the income will be received. Investment income is accounted for on a received basis with the exception of accrued interest on gilts and bonds which is due but not yet received at the year-end.
1.4 Expenditure
All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Expenditure is recognised where there is a legal or constructive obligation to make payments to third parties, it is probable that the settlement will be required and the amount of the obligation can be measured reliably. It is categorised under the following headings:
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Raising funds includes investment management fees
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Expenditure on charitable activities includes all costs incurred on furthering the objects of the Trust; including support and governance costs
Irrecoverable VAT is charged as an expense against the activity for which expenditure arose.
Grants are recognised when the trustees have made a decision to make a payment and that decision has been communicated to the recipient and it is probable that payment will take place. However, the recognition of any liability will be dependent on any conditions attaching to the commitment.
Grants payable to third parties are within the charitable objectives. Where unconditional grants are offered, this is accrued as soon as the recipient is notified of the grant, as this gives rise to a reasonable expectation that the recipient will receive the grants. Where grants are conditional relating to performance then the grant is only accrued when any unfulfilled conditions are outside of the control of the Trust.
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THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
1. Accounting Policies
1.5 Support costs allocation
Support costs are those that assist the work of the Trust but do not directly represent charitable activities and include general management, administration and governance costs. They are incurred in support of expenditure on the objects of the Trust. The analysis of these costs are included in note 4.
1.6 Fixed Assets and depreciation
All fixed assets are stated at cost. Depreciation is provided on all tangible assets other than freehold land and buildings, at rates calculated to write off the cost of each asset, less any estimated residual value, evenly over its expected useful life. The expected useful lives of the principal categories are:
Fixtures and fittings- over 15 years
1.6 Investments
Investments are included on the balance sheet at fair value (being the year end mid-market), with changes in fair value and surpluses/deficits on disposals, recognised as net gains or losses on investments in the statement of financial activities.
1.7 Creditors payable within one year
Creditors are recognised when the Trust has a present legal or constructive obligation resulting from a past event and the settlement is expected to result in an outflow of economic benefits.
1.8 Foreign Currencies
Transactions carried out and investments valued in foreign currencies are converted into sterling using the figures published in the Portfolio Managers' reports. The Sterling equivalent of any cash held in foreign currencies on the year end date is restated using the closing rate. An exchange rate adjustment is included in the accounts reflecting this.
1.9 Going concern
The financial statements have been prepared on a going concern basis as the Trustees consider that no material uncertainties exist. Following the COVID-19 pandemic, the Trustees have considered the impact this has had on the level of funds held and the expected level of income and expenditure for a minimum of 12 months from the date of authorisation of these financial statements. The budgeted income and expenditure and level of reserves is sufficient for the Trust to be able to continue as a going concern.
1.10 Tax
The Earmark Trust is a registered Trust and is exempt from tax under the provisions of the Corporation Tax Act 2010 on its activities.
1.11 Financial instruments
The Trust only holds basic Financial Instruments. The financial assets and financial liabilities of the Trust are as follows:
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Cash at bank – is classified as a basic financial instrument and is measured at face value.
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Liabilities – accruals and other creditors are classified as financial instruments, and are measured at amortised cost as detailed in Note 10.
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THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
| 2. Charitable Expenditure Grants made in the year - institutions Total grants awarded in the year 3. Provision of accommodation for beneficiary Electricity Gas Insurance Telephone Water rates Repairs 4. Support and governance costs Administrative fees BDB Pitmans accountancy fees BDB Pitmans legal administration fees Sally Knight - Independent examiner's fees Depreciation Motor expenses Computer, Postage, stationary, share of office expenses Interest 5. Governance costs Accountancy Services Independent Examination Legal administration fees |
2021 £ - - 633 690 516 372 288 500 £ 2,999 90 2,100 1,560 975 1,050 - 139 10 £ 5,924 2,100 975 1,560 £ 4,635 |
2020 £ 23,000 |
|---|---|---|
| £ 23,000 | ||
| 473 261 487 330 216 - |
||
| £ 1,767 | ||
| 978 2,700 - 1,400 139 548 146 1 |
||
| £ 5,912 | ||
| 2,700 1,400 - |
||
| £ 4,100 |
6. Disclosure of Trustees' remuneration, benefits and expenses
The Trustees (who are considered to be key management personnel of the Trust) received no personal remuneration, benefits or reimbursed expenses during the period under review in their capacity as Trustees (2020 None).
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THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
| 7. Tangible fixed Assets Cost At 5 April 2020 Additions in the year At 5 April 2021 Depreciation At 5 April 2020 Charge for the year At 5 April 2021 Net book value At 5 April 2021 At 5 April 2020 |
Land and Fixtures and Total Buildings fittings £ 79,599 12,258 91,857 - - - |
|---|---|
| £ 79,599 £ 12,258 £ 91,857 |
|
| - 11,208 11,208 - 1,050 1,050 |
|
| £ - £ 12,258 £ 12,258 |
|
| £ 79,599 £ - £ 79,599 |
|
| £ 79,599 £ 1,050 £ 80,649 |
The Trustees agreed to write down the fixtures and fittings in the year rather than depreciate over the remainder of the 15 year period.
The land and buildings comprise of one freehold property which is used by a beneficiary under a licence to occupy.
The property was purchased by the Trust in 1989. The beneficiary residing in the Trust property is not a connected party.
8. Investments
| Quoted investments were as follows: (All Listed) Fair value at 5 April 2020 Add: acquisitions at cost Less: disposals proceeds - Realised gains/(losses) on investments - Unrealised gains/(losses) on revaluation Fair value at 5 April 2021 Historical cost at 5 April 2021 Analysis of investments Investment assets in the UK Investments assets outside the UK Fair value at 5 April 2021 All investments are listed on a recognised stock exchange. |
2021 £ 809,185 323,239 (357,251) 35,769 127,260 £ 938,202 £ 741,922 612,814 325,388 938,202 £ |
2020 £ 949,984 228,733 (226,122) (22,161) (121,250) |
|---|---|---|
| £ 809,185 | ||
| £ 730,259 | ||
| 622,150 187,035 |
||
| £ 809,185 |
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THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
| 9. Debtors Other debtors and prepayments Accrued interest on investments 10. Creditors - amounts falling due within one year Accruals Other creditors |
2021 £ 1,808 2,152 3,960 £ 2021 £ 7,175 205 7,380 £ |
2020 £ 1,793 1,779 |
|---|---|---|
| £ 3,572 | ||
| 2020 £ 4,100 1,102 |
||
| £ 5,202 |
11. Analysis of Net Assets Between Funds
Fund balances at 5 April 2021 are represented by:
| Unrestricted Funds Fixed Assets Current Assets Creditors Net Assets |
Accumulated Income £ 321,076 120,563 (7,380) 434,259 £ |
Capital £ 696,725 - - 696,725 £ |
Total Funds 2021 £ 1,017,801 120,563 (7,380) |
|---|---|---|---|
| 1,130,984 £ |
The summary of net assets between funds for 5 April 2020 was as follows:
| Unrestricted Funds Fixed Assets Current Assets Creditors Net Assets |
Accumulated Income £ 193,109 75,828 (5,202) 263,735 £ |
Capital £ 696,725 - - 696,725 £ |
Total Funds 2020 £ 889,834 75,828 (5,202) |
|---|---|---|---|
| 960,460 £ |
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THE EARMARK TRUST
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 5 APRIL 2021
12. Fund reconciliation
| 12. Fund reconciliation | |
|---|---|
| Accumulated income fund Capital fund Total Funds Accumulated income fund Capital fund Total Funds |
Balance Income Expenditure Gains/ Balance 06.04.20 (Losses) 05.04.21 £ £ £ £ £ 263,735 25,152 (17,656) 163,028 434,259 696,725 - - - 696,725 |
| 960,460 £ 25,152 £ (17,656) £ 163,028 £ 1,130,984 £ |
|
| Balance Income Expenditure Gains/ Balance 06.04.19 (Losses) 05.04.20 £ £ £ £ £ 414,803 32,527 (40,184) (143,411) 263,735 696,725 - - - 696,725 |
|
| 1,111,528 £ 32,527 £ (40,184) £ (143,411) £ 960,460 £ |
13. Transactions with Related Parties
At the year-end there was an outstanding debtor balance of £1,144 (2020: £1,144) in respect of reimbursements for provision for accommodation and support costs due from F C Raven, a Trustee of the Charity. There were no other related party transactions.
14. Employees
The Trust does not employ any staff (2020: none).
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