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2022-03-31-accounts

RMIG ENDOWMENT TRUST

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2022

Charity Number: 290883

RMIG ENDOWMENT TRUST

Contents Page
Trustees’ Annual Report 3
Statement of Trustees Responsibilities 12
Auditor’s Report 13
Statement of Financial Activities 16
Balance Sheet 17
Statement of Cash Flows 18
Notes to the Financial Statements 19

Page 2

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

The trustee is pleased to submit its report for the year ended 31[st] March 2022.

Reference and Administrative Information

Name and Registered Office

The name of the charity is the RMIG Endowment Trust (the “Charity”) and its principal office is located at 60 Great Queen Street, London, WC2B 5AZ.

Trustees

The trustee who served during the whole of the year was:

The trustees of the MCF who served during the year were:

James H. Newman resigned as Chairman of the MCF on 31[st] March 2021 and Trustee of the MCF on 28[th] April 2021, and Sir Paul Williams was appointed Chairman on 1[st] April 2021.

Page 3

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Executive

The Executive during the year to 31[st] March 2022 were:

Auditor

Knox Cropper LLP, Chartered Accountants, 65 Leadenhall Street, London, EC3A 2AD

Bankers

Clydesdale Bank Plc, Unit 8, 3 The Chase, John Tate Road, Hertford, Herts SG13 7NN

Investment Advisors

Asset Risk Consultants Limited, 7 New Street, St. Peter Port, Guernsey, GY1 2PF

Investment Managers

Thesis Unit Trust Management Ltd, Exchange Building, St John's Street, Chichester, West Sussex PO19 1UP

Solicitors

Stone King LLP, Boundary House, 91 Charterhouse Street, London, EC1M 6HR

Page 4

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Structure, Governance and Management

Organisation

The Charity is governed under the terms of a trust deed dated 29[th] November 1984 which constitutes an unincorporated charity. The trust deed has been varied a number of times to accommodate changes in trustees, with the latest variation dated 5[th] April 2019 appointing the MCF and its chairman as trustees of the Charity. Following the granting of trust corporation status to the MCF, the chairman resigned as a trustee of the Charity on 12[th] December 2019.

Governance and Management

The MCF is the sole trustee of the Charity. Details of the processes for the appointment, induction and training of the MCF’s trustees are given in the annual report and accounts of that company.

All governance and management capabilities are provided by the MCF and details of the relevant committees and processes are provided in the annual report and accounts of that company. Trustees and committees of the MCF address the specific needs of the Charity as part of their roles and responsibilities for the MCF. The trustee board and the main committees meet as follows:

Board/Committee Purpose Meetings per
**year **
Trustee Board Main decision-making body with ultimate responsibility for the
Charity		 4
Audit and Risk Identification and mitigation of risk, oversight of external audit 2
Finance Ensuring adequate procedures are in place to manage all
aspects of financial planning, controlling and reporting.		 4
Investments Maintaining investment strategies to meet the requirements of
the Charity, appointment and monitoring of fund managers		 4
Property Development and execution of strategies to optimise the returns
from the Charity’s property portfolio		 4
Strategy Development and implementation of strategies to support the
Charity’s objectives.		 4

The Charity does not employ any staff, with services being provided by staff employed by the MCF.

Objectives and Activities

The objects of the Charity

The primary purpose of the Charity is to apply its resources for any charitable purpose connected with the Royal Masonic School for Girls (the “School”) or the education of its pupils who are daughters or adopted daughters of English Freemasons considered to be in need. The resources consist of funds donated by Freemasons to the Royal Masonic Institution for Girls and transferred by that charity to the trustees on establishment of the Charity on 29[th] November 1984, together with property and real estate at Rickmansworth Park which houses the School.

Page 5

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

The main activities

Since its establishment, a policy of the Charity has been to ensure the proper maintenance of the property and real estate to optimise the running of the School. The Charity provides scholarships and bursaries on a “need or means tested” basis to daughters or adopted daughters of Freemasons in accordance with the trust deed.

When setting the objectives and planning the work of the Charity for the year, the trustee has given careful consideration to the Charity Commission’s general guidance on public benefit. In meeting its objects, the trustee has been mindful of the public benefits which the Charity and the School can jointly provide to local, provincial and national organisations by the use of the grounds, sports facilities and the various halls and buildings.

Achievements and Performance

During the period, the Charity expended £3.17 M on supporting the School (2021: £1.33 M). Major areas of repair and refurbishment included: refurbishment of the ceiling and roof of the dining hall, replacement of the heating system in the remaining K houses, fire containment work including the replacement/repair of 381 fire doors in the G block and K houses and refurbishment of the roof, fascias, soffits guttering to Cadogan House.

Financial Review

Review of the Year

Unrestricted Fund

The School was adversely impacted by Covid-19 and government-imposed lockdown during the previous year and requested support from the Charity. Negotiations are in progress with regard to a six-year interim lease commencing from 1[st] September 2020 followed by a reversionary long term lease, and a rent free period is anticipated which will include the period from 1[st] September 2020 to 31[st] August 2022. As the rent free period will be spread over the six-year term of the interim lease rent of £1.27 M has been accrued as at 31[st] March 2022.

Total expenditure for charitable purposes amounted to £3.22 M (2021: £1.40 M). A transfer of £5.20 M was made from the endowment fund to fund expenditure in the current year and part of the cost planned for 2022/23. The surplus for the year of £3.85 M (2021: £2.13 M) was transferred to reserves.

Endowment Fund

Dividend income of £0.16 M (2021: £0.24 M) was generated from the investment portfolio with costs of £0.05 M (2021: £0.06 M).

Net gains from the Charity’s investment in the MCF CAIF amounted to £1.01 M (2021: £2.60) and withdrawals of £5.20 M were made to fund the transfer to the unrestricted fund (2021: £3.56 M). £3.21 M was written back to the value of the social investment property (the buildings leased to the School) following the repairs undertaken during the year, but a further provision of £2.4 M was made in recognition of the increased scope and cost required to complete the programme of backlog works.

Page 6

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Reserves Policy

As at the 31 March 2022 the total level of reserves was £15.37 M, of which £10.53 M related to endowment funds and the remainder of £4.85 M related to the working capital within the unrestricted general reserve.

The Charity’s policy is to apply its resources for any charitable purpose connected with the School or the education of its pupils who are daughters or adopted daughters of English Freemasons in accordance with the trust deed. The Charity has commissioned a report from a firm of professional surveyors to consider the condition of the School buildings in anticipation of a new tenant repairing lease, from which significant dilapidations have been identified for rectification. The expected cost for this is estimated at £16.01 M and full provision has been made for this against the value of the investment property as laid out in note 6 to the accounts. In order to provide increased availability of funds, the trustee board agreed to adopt a Total Return basis for utilising investment returns on 12[th] December 2019, replacing the previous policy of applying in-year income only for the purpose of supporting the School. The surplus over the original endowment has been transferred to a separate reserve for the total unapplied return.

The social investment property has been valued through the discounting of expected future lease payments using a yield of 5.5% as the cost of capital, less the residual value of the provision for backlog repairs. This provision is being released back to the endowment fund in line with the works being completed and charged to the unrestricted general reserve. The provision for backlog repairs is reviewed on an annual basis, and adjusted as required in accordance with the evolving cost for the planned works.

Investment Policy and Performance

The investment strategy was to provide sufficient income to support the Charity’s primary objectives whilst maintaining its real value to ensure that purchasing power does not diminish in the long-term. The trustee recognised that this required a medium to high risk asset allocation, with up to 85% of the portfolio invested in equities. Risk was mitigated through a diverse portfolio of fixed interest securities, equities, unit trusts and open-ended investment companies. Following the trustee’s decision to adopt a Total Return basis, the requirement to maximise the income component of the investment return was removed, and the Charity was able to adopt the MCF investment strategy and to transfer its funds to the MCF CAIF.

The MCF global investment strategy seeks to protect the capital value of investments that are required to fund operations for a two-year time horizon (the “Cash Reserve”) and to invest all remaining funds for long term growth, on a total return basis, with an overall objective of making a return of RPI plus 3% net of all expenses.

The Cash Reserve is provided by Royal London Asset Management and utilises three of their funds, which provide a mix of instruments, including cash instruments, Treasury Bills, covered (secured) bonds, corporate bonds, Supranationals and mortgage-backed securities. The performance objectives of the three funds are:

Page 7

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Investment Policy and Performance (Continued)

The MCF sponsored the launch of the Masonic Charitable Foundation Investment Fund CAIF, which took place on 1[st] October 2018. This is a unit trust with a highly efficient tax wrapper in which the MCF and all its subsidiary charities own their shares in the form of units. Units will be sold as required in order to top up the Cash Reserve on a quarterly basis. The investment strategy is directed for “Steady Growth”, which is a medium-high risk strategy. Risk is managed through diversification, with the funds split between four different fund managers operating on multi asset mandates but utilising differing investment management styles. The overall fund manager is Thesis Unit Trust Management Limited and the custodian in Northern Trust.

The asset allocation for the CAIF was amended on 1[st] April 2019 by the investment committee following advice from Asset Risk Consultants. The strategic and actual asset allocations as at 31[st] March 2022 are shown in the following table:

hown in the following table:
Asset Class Strategic
Allocation		 Benchmark Actual 31st
March
2022
Cash 0.00% SONIA 3.20%
FixedIncome 7.50% FTSEUK World Gov. BondIndexGBP 4.40%
International Equity 28.75% MSCI World ex UK NR GBP 56.40%
Int’nl Equity GBP hedged 12.00% MSCI World ex UK Hedged NR GBP 3.40%
U.K. Equity 18.00% MSCI UK Equity NR GBP 18.50%
Emerging Market Equity 12.50% MSCI Emerging Markets Equity NR GBP 2.80%
Global EquityHedge 13.75% HFRXGlobal EquityHedge GBP 0.00%
Alternative Investments 3.75% HFRX Global Hedge Fund GBP 7.80%
Property 3.75% IA UK Direct Property TR 3.50%
100.00% 100.0%

Performance under the new arrangements is shown in the table overleaf. Note that performance for periods before launch on 1[st] October 2018 is derived from the historical returns of the constituent fund managers:

Page 8

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Investment Policy and Performance (Continued)

MCF CAIF RLAM
Short Term		 RLAM
Cash Plus		 RLAM
Enhanced		 CCLA
Fund at 31stMarch 2022 £7.57 M £Nil £Nil £Nil £Nil
Investment approach Steady
Growth Multi-
Asset		 Capital
Protection		 Capital
Protection		 Capital
Protection		 Income &
long-term
Capital
Growth
Benchmark Composite SONIA SONIA SONIA MSCI/AREF
UK other
balanced
property
Peer Group ARC Charity
GBP Steady
Growth		 None None None ARC Charity
GBP Steady
Growth
Return for the year 10.30% 0.13% (0.09)% (0.65)% 19.30%
Benchmark return for year 9.80% 0.14% 0.14% 0.14% 9.70%
Peergroupreturn foryear 7.10% N/A N/A N/A 7.10%
3 year return 33.00% 0.38% 0.64% 0.80% 27.00%
3 year benchmark 26.90% 0.28% 0.28% 0.28% 2.50%
3 year peer group 22.40% N/A N/A N/A 22.40%

The CAIF has continued to perform strongly during the year, hitting a peak of just over £133.00 per unit at 31[st] December. It fell back in the final quarter due to geopolitical and inflationary concerns, but recovered strongly in the latter part of March. As at 31[st] March 2022, the CAIF was valued at £129.73 per unit.

Page 9

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Principal Risks and Mitigation

The principal risks identified and agreed actions to mitigate are shown in the following table:

**Risk ** Consequence **Mitigation **
Significant unexpected
financial loss from
operations		 Reputational damage, loss of
confidence with key stakeholders
and impact upon continuing financial
sustainability		 Strong financial procedures,
particularly budgetary planning and
control. Oversight from the Finance
Committee.
Inadequate liquidity to
meet financial
commitments		 Poor service to beneficiaries and
reputational damage. Withdrawal of
key servicesfromsuppliers		 Cash flow forecasting and liquidity
planning within the Investment
Strategy
Significant long-term loss
in the value of the
investment portfolio		 Impacts financial sustainability and
reputational damage with donors		 Appointment of Asset Risk
Consultants as expert investment
advisors, providing monthly
performance reporting and
analysis. Oversight from
investment and property
committees.
Grants made outside the
Charity’s Objects and
operating guidelines		 Reputational damage, loss of
confidence with key stakeholders
and potential trustee liability		 Strong procedures and controls for
processing grants. Oversight from
Masonic Support and Charity
Grants committees
Cyberattack on IT
systems		 All key operations are compromised United Grand Lodge of England
(“UGLE”) and IT network providers
have strong security procedures in
place covering access, protection,
backups and disaster recovery
facilities. Mandatory cybersecurity
training in place for all staff
Data protection breach Reputational damage and significant
financial penalties		 Data protection policy, IT security
and HR policies in place
Fraud Financial loss, reputational damage,
adverse impact upon staff		 Financial procedures, segregation
of duties, authority limits, IT
security, increased awareness
amongst staff
Unavailability of office
accommodation		 Operations compromised UGLE Business Continuity Plan
Loss of paper records
from fire/flooding		 Breach of legal obligations, adverse
impact upon operations, potential
financialpenalties		 Reduced reliance on paper records
with increased use of IT.
Lack of compliance with
employment legislation		 Breach of legal obligations, potential
financial penalties, breakdown of
staff morale and adverse impact
upon service provision		 HR procedures and staff
handbook. Induction processes for
new staff. Ongoing management
training and Personal Development
Review
Undue reliance on key
persons		 Operational breakdown, adverse
impact upon staff morale, poor
service to beneficiaries and potential
reputationaldamage		 HR procedures: organisational and
succession planning.
Comprehensive documentation of
procedures and controls

Risks are actively monitored by the Executive and the senior leadership team, and formally reviewed by the audit and risk committee at their biannual meetings.

Page 10

RMIG ENDOWMENT TRUST

TRUSTEE’S ANNUAL REPORT

Plans for Future Periods

The MCF plans to continue to operate the Charity in a prudent manner that meets the needs of its beneficiaries over the long term. It recognises the requirement to work closely with the School to resolve the backlog of repairs to its infrastructure that have built up over many years and will prioritise the development and execution of a 6-year plan to address these issues in a sustainable manner.

Negotiations are still in progress with regard to a replacement lease. The plan is to put in place a six-year interim lease, on terms similar to the previous lease, commencing with effect from 1[st] September 2020. This lease will run in tandem with the programme to address the backlog repairs. A long-term (99 year) tenant repairing reversionary lease will be executed simultaneously and will commence upon the expiry of the interim lease on 1[st] September 2026.

Page 11

RMIG ENDOWMENT TRUST

STATEMENT OF TRUSTEE’S RESPONSIBILITIES

Statement of Responsibilities

The trustee is responsible for preparing the trustee’s report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (U.K. “GAAP”).

The law applicable to charities in England and Wales, the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust deed require the trustee to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Charity and of the income and expenditure of the Charity for that year.

In preparing these financial statements, the trustee is required to:

The trustee is responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the Charity and enable it to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust deed. It is also responsible for safeguarding the assets of the Charity and for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Auditor

A resolution proposing that Knox Cropper LLP be reappointed as auditor will be put to the members.

Approval by Trustee

This report, was approved by the trustee on 15[th] September 2022 and signed on their behalf by

Sir Paul Williams, OBE, KStJ, DL

Chairman, MCF

Page 12

RMIG ENDOWMENT TRUST

REPORT OF THE INDEPENDENT AUDITOR TO THE TRUSTEE OF THE RMIG ENDOWMENT FUND

We have audited the financial statements of the RMIG Endowment Fund (the “Charity”) for the year ended 31 March 2022 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows 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).

In our opinion the financial statements:

Basis of opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The trustee is responsible for the other information.

Page 13

RMIG ENDOWMENT TRUST

REPORT OF THE INDEPENDENT AUDITOR TO THE TRUSTEE OF THE RMIG ENDOWMENT FUND

Our opinion on the financial statements does not cover the other information and 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 themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

Responsibilities of Trustee

As explained more fully in the Trustee’s Responsibilities Statement set out on page 12, the trustee is 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 trustee determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustee is responsible for assessing the Charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustee either intends to liquidate the company or to cease operations, or has 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 144 of the Charities Act 2011 and report in accordance with the Act 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.

Page 14

RMIG ENDOWMENT TRUST

REPORT OF THE INDEPENDENT AUDITOR TO THE TRUSTEE OF THE RMIG ENDOWMENT FUND

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:

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of the audit report

This report is made solely to the Charity’s trustee, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken, so that we might state to the Charity’s trustee those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charity and the Charity’s trustee as a body, for our audit work, for this report or for the opinions we have formed.

Knox Cropper LLP Statutory Auditor 65 Leadenhall Street London EC3A 2AD

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

Page 15

RMIG ENDOWMENT TRUST

STATEMENT OF FINANCIAL ACTIVITIES

YEAR ENDED 31 MARCH 2022

(Including an Income and Expenditure Account)

Note
INCOME
Donations
Investment income
2
Total income
EXPENDITURE
Investment management costs
Charitable activities
Masonic grants
3
Non-Masonic grants
3
Total expenditure
Net gains/(losses) on investments
7
Net income/(expenditure)
Transfers between funds
10
NET MOVEMENT IN FUNDS
Total funds brought forward
Total funds carried forward		 Unrestricted
Endowment
Total
Total
funds
funds
Funds
Funds
2022
2022
2022
2021
£'000
£'000
£'000
£'000
0
0
0
335
1,876
156
2,032
161
1,876
156
2,032
496
0
(48)
(48)
(56)
0
(48)
(48)
(56)
0
(0)
(0)
(10)
(3,222)
0
(3,222)
(1,391)
(3,222)
(0)
(3,222)
(1,401)
(3,222)
(48)
(3,270)
(1,457)
0
1,823
1,823
3,827
(1,346)
1,931
585
2,866
5,200
(5,200)
0
0
3,854
(3,269)
585
2,866
991
13,798
14,789
11,923
4,845
10,529
15,374
14,789

All income and expenditure derive from continuing activities and all gains/losses are included in the statement of financial activities

The notes on pages 19 to 28 form part of these financial statements. The prior year figures are analysed by fund in note 13 on page 27.

Page 16

RMIG ENDOWMENT TRUST
BALANCE SHEETas at 31 March 2022
Note
FIXED ASSETS
Investment properties
6
Investments
7
CURRENT ASSETS
Debtors
8
Cash at bank and in hand
CURRENT LIABILITIES
Creditors falling due within one year
9
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
Creditors falling due after one year
9
Total net assets
CHARITABLE FUNDS
Endowment funds
Permanent endowment
10
Total unapplied return
10
Unrestricted funds
General reserves
10
Total charitable funds		 March 2022
March 2021
£'000
£'000
2,951
2,138
7,576
11,659
10,527
13,797
1,283
0
4,484
1,739
5,767
1,739
(443)
(747)
5,324
992
15,851
14,789
(477)
0
15,374
14,789
10,909
10,909
(380)
2,889
10,529
13,798
4,845
991
15,374
14,789

The financial statements were approved and authorised for issue by the Trustee Board on 15th September 2022 and signed on their behalf by:

…………………………………….. ……………………………………. Sir Paul Williams, OBE, DL Michael Heenan Chairman Treasurer

The notes on pages 19 to 28 form part of these financial statements

Page 17

RMIG ENDOWMENT TRUST

CASH FLOW STATEMENT
CASH FLOW STATEMENT YEAR ENDED 31 MARCH 2022
Note 2022 2021
£'000 £'000
Operating Activities
Net cash (used in) Operating Activities A (5,157) (1,102)
Cash flows from investing activities
Dividends and interest from investments 2,032 161
Proceeds from the sale of investments 5,200 3,556
Purchase of investments 0 (279)
Net cash provided by/(used in) Investing Activities 7,232 3,438
Cash flows from financing activities
Bank loans taken out/(repaid) 670 (1,033)
Change in cash and cash equivalents in the reporting
period 2,745 1,303
Cash and cash equivalents at the beginning of the
reporting period 1,739 436
Cash and cash equivalents at the end of the reporting
period 12 4,484 1,739
Notes on the cash flow statement
A Reconciliation of net income/(expenditure) to net
cash flow from operating activities
Net movement in Funds as per the Statement of
Financial Activities 585 2,866
Adjustments for:
Impairment of investment property (813) (1,229)
Dividends, interest and rents from investments (2,032) (161)
Other movements in investments (1,117) (2,782)
(Increase) in debtors (1,283) 0
(Decrease)/increase in creditors (497) 204
Net cash (used in) Operating Activities (5,157) (1,102)

Page 18

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

1. ACCOUNTING POLICIES

(a) Statement of compliance

The financial statements of the RMIG Endowment Trust (the “Charity”) have been prepared in accordance with applicable UK accounting standards, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland” (“FRS 102”). Additionally, they comply with the Statement of Recommended Practice “Accounting and Reporting by Charities” (FRS 102 second edition) published in 2019 (the “SORP”) in all material respects. The Charity meets the definition of a public benefit entity under FRS 102.

(b) Basis of preparation

The financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the revaluation of investments, on a basis consistent with previous years. The functional currency of the Charity is considered to be Pounds Sterling because that is the currency of the primary economic environment in which the Charity operates.

(c) Going concern

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

The trustees of the Charity have concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the Charity to continue as a going concern. The trustees are of the opinion that the Charity will have sufficient resources to meet its liabilities as they fall due.

(d)

Incoming resources

Revenue is recognised when the significant risks and rewards of ownership have been transferred, the amount of revenue can be measured reliably, it is probable that future economic benefits will flow to the Charity and when the specific criteria relating to each of the Charity’s revenue channels have been met, as described below:

Page 19

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

(d) Resources expended

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the Charity to that expenditure, it is probable that settlement will be required and the amount of any obligation can be measured reliably. All resources expended are recognised on an accruals basis, with the exception of grants as noted below.

Grants are recognised as expenditure in the year in which the grant is formally approved by the Charity and has been communicated in writing to the recipient, except to the extent that it is subject to conditions that enable the Charity to revoke the award.

(e) Allocation and apportionment of costs

Support costs include central functions and have been allocated to activity cost categories on a basis consistent with the use of resources.

(f) Employee benefits

All staff are employed by the parent charity, The Masonic Charitable Foundation. No charge is made to the Charity in respect of staff providing services to the Charity. No remuneration is paid to trustees and no expenses reimbursed.

(g) Fund accounting

Unrestricted funds may be utilised for any purpose in accordance with the charitable objectives of the Charity. The trustees took the decision at the end of the previous year to move the endowment fund to a total returns basis, resulting in a change of policy. Investment income and management fees are retained within the CAIF and the endowment fund. Withdrawals from the CAIF are transferred to the general fund from the total unapplied return section of the endowment fund.

(h) Investments

Investments are recognised initially at fair value which is normally the transaction price excluding transaction costs. Subsequently, they are stated at market value. All realised and unrealised gains and losses are recognised within the Statement of Financial Activities. Investments which the Charity holds for resale or pending their sale and cash or cash equivalents with a maturity date of less than one year, which are held for investment purposes, are disclosed as current asset investments.

(i) Financial assets and liabilities

The Charity has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments. Financial assets and liabilities are recognised when the Charity becomes a party to the contractual provisions of the instrument.

Page 20

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

Financial assets and liabilities which qualify as basic financial instruments are initially recognised at the settlement amount after any trade discounts. They are subsequently valued at amortised cost and assessed for impairment at the end of each reporting period. Where settlement is not expected within 12 months of the balance sheet date, then the asset or liability is discounted using the long term return of inflation plus 4 percent used as the target for the Charity’s investment portfolio . Basic financial instruments include debtors, cash and creditors within the balance sheet.

(j) Taxation

The Charity is an exempt charity within the meaning of schedule 3 of the Charities Act 2011 and it is considered to pass the test set out in paragraph 1, schedule 6 of the Finance Act 2010, and therefore it meets the definition of a charity for U.K. Corporation Tax purposes. The Charity is unable to recover Valued Added Tax (VAT) incurred on expenditure. The amount of VAT that cannot be recovered is included within the underlying cost to which it relates.

(k) Social Investment Property

The social investment property has been valued through the discounting of expected future lease payments using a yield of 5.5% as the cost of capital, less the residual value of the provision for backlog repairs. This provision is being released back to the endowment fund in line with the works being completed and charged to the unrestricted general reserve. The provision for backlog repairs is reviewed on an annual basis, and adjusted as required in accordance with the evolving cost for the planned works. Gains or losses are recognised within the Statement of Financial Activities. No depreciation is provided on social investment properties.

Page 21

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

2.
INVESTMENT INCOME
Interest on bank deposits
Income from investment portfolios
Rental income - Royal Masonic School
Rental income - other
Income - other
3.
CHARITABLE ACTIVITIES
Masonic
Foundation scholarships & bursaries
Non-Masonic
Property expenses
Support Costs
4.
SUPPORT COSTS
Administrative costs
Interest and bank charges
Governance costs		 Unrestricted Endowment
Total
Total
funds
funds
Funds
Funds
2022
2022
2022
2021
£'000
£'000
£'000
£'000
4
0
4
3
0
156
156
240
1,872
0
1,872
(90)
0
0
0
8
0
0
0
0
1,876
156
2,032
161
Unrestricted
Endowment
Total
Total
funds
funds
Funds
Funds
2022
2022
2022
2021
£'000
£'000
£'000
£'000
0
0
0
10
0
0
0
10
3,172
0
3,172
1,335
50
0
50
56
3,222
0
3,222
1,391
Unrestricted
Endowment
Total
Total
funds
funds
Funds
Funds
2022
2022
2022
2021
£'000
£'000
£'000
£'000
0
0
0
0
23
0
23
38
27
0
27
18
50
0
50
56

5. STAFF COSTS

The Charity employed no staff during the year (2021: None). No staff recharges have been made from the MCF to the Charity.

No trustees received remuneration from the Charity during the year (2021: £ Nil). No trustees’ expenses were incurred during the year (2021: £ Nil).

Page 22

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022
6.
SOCIAL INVESTMENT PROPERTY
Balance at 1 April 2021
Additional provision for backlog repairs
Utilisation of provision for backlog repairs
Balance at 31 March 2022
7.
INVESTMENTS
Fixed Asset Investments:
- Managed Funds
MCF CAIF
MOVEMENTS IN INVESTMENTS
Listed
Balance at 1 April 2021
Additions
Disposals
Investment income reinvested
Management fees charged to the fund
Gains/(losses)
Balance at 31 March 2022
RECONCILIATION TO SOFA
Gains on listed investments
Provision for backlog repairs on social investment property		 March 2022
March 2021
£'000
£'000
2,138
909
(2,401)
0
3,214
1,229
2,951
2,138
March 2022
March 2021
£'000
£'000
7,576
11,659
7,576
11,659
11,659
12,154
0
279
(5,200)
(3,556)
156
240
(48)
(56)
1,009
2,598
7,576
11,659
1,009
2,598
814
1,229
1,823
3,827

Page 23

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

8.
DEBTORS
Prepayments and accrued income
Amounts owed by group undertakings
9.
CREDITORS
Falling due within one year
Bank loans and overdrafts
Trade creditors
Amounts owed to group undertakings
Other creditors
Accruals
Falling due after more than one year
Bank loans		 March 2022
March 2021
£'000
£'000
1,265
0
18
0
1,283
0
March 2022
March 2021
£'000
£'000
193
0
233
52
0
9
0
674
17
12
443
747
March 2022
March 2021
£'000
£'000
477
0
477
0

A new bank loan was taken out on 7[th] April 2021 for an amount of £835,817. It is repayable in 52 monthly instalments ending 10[th] August 2025. Interest is chargeable at a fixed rate of 3.31%

Page 24

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

10.MOVEMENT IN FUNDS
Endowment funds
Permanent endowment
Total unapplied return
Unrestricted funds
General reserves
Total funds
PRIOR YEAR
Endowment funds
Permanent endowment
Total unapplied return
Unrestricted funds
General reserves
Total funds		 Balance at Income Expenditure
Gains/ Transfers
Balance at
1 April
(losses)
31 March
2021
2022
£'000
£'000
£'000
£'000
£'000
£'000
10,909
0
0
0
0
10,909
2,889
156
(48)
1,823
(5,200)
(380)
13,798
156
(48)
1,823
(5,200)
10,529
991
1,876
(3,222)
0
5,200
4,845
991
1,876
(3,222)
0
5,200
4,845
14,789
2,032
(3,270)
1,823
0
15,374
Balance at Income Expenditure
Gains/ Transfers
Balance at
1 April
(losses)
31 March
2020
2021
£'000
£'000
£'000
£'000
£'000
£'000
10,909
0
0
0
0
10,909
2,156
518
(56)
3,827
(3,556)
2,889
13,065
518
(56)
3,827
(3,556)
13,798
(1,142)
(22)
(1,401)
0
3,556
991
(1,142)
(22)
(1,401)
0
3,556
991
11,923
496
(1,457)
3,827
0
14,789

Page 25

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

11.ASSETS AND LIABILITIES
Endowment funds
Permanent endowment
Total unapplied return
Unrestricted funds
General reserves
Total funds
PRIOR YEAR
Endowment funds
Permanent endowment
Total unapplied return
Unrestricted funds
General reserves
Total funds		 Investment Investments
Current Liabilities &
Fund
Properties
Assets
Provisions
Total
£'000
£'000
£'000
£'000
£'000
909
10,000
0
0
10,909
2,042
(2,424)
2
0
(380)
2,951
7,576
0
0
10,529
0
0
5,765
(920)
4,845
0
0
5,765
(920)
4,845
2,951
7,576
5,767
(920)
15,374
Investment Investments
Current Liabilities &
Fund
Properties
Assets
Provisions
Total
£'000
£'000
£'000
£'000
£'000
909
10,000
0
0
10,909
1,229
1,659
0
(1)
2,887
2,138
11,659
0
(1)
13,796
0
0
1,739
(746)
993
0
0
1,739
(746)
993
2,138
11,659
1,739
(747)
14,789

12. RELATED PARTY DISCLOSURES

As described in the trustees report the Charity has a close working relationship with the Royal Masonic School for Girls (the “School”). Two trustees of the ultimate holding company are also governors of the School.

At the balance sheet date, a total amount of £Nil due from the Charity to the School (2021: £673,935) was included in other creditors (note 9).

The Charity is currently in the process of agreeing a long-term lease with the School, and the heads of terms document has been used for the purpose of valuing the social investment property as per note 6 of the financial statements.

Page 26

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

13. STATEMENT OF FINANCIAL ACTIVITIES

12 MONTHS ENDED 31 MARCH 2021

(Including an Income and Expenditure Account)

Note
INCOME
Donations
Investment income
2
Total income
EXPENDITURE
Investment management costs
Charitable activities
Masonic grants
3
Non-Masonic grants
3
Total expenditure
Net gains/(losses) on investments
7
Net income/(expenditure)
Transfers between funds
10
NET MOVEMENT IN FUNDS
Total funds brought forward
Total funds carried forward		 Unrestricted Endowment
Total
Total
funds
funds
Funds
Funds
2021
2021
2021
2020
£'000
£'000
£'000
£'000
57
278
335
0
(79)
240
161
1,799
(22)
518
496
1,799
0
(56)
(56)
(58)
0
(56)
(56)
(58)
(10)
0
(10)
(17)
(1,391)
0 (1,391)
(1,583)
(1,401)
0 (1,401)
(1,600)
(1,401)
(56) (1,457)
(1,658)
0
3,827
3,827 (14,858)
(1,423)
4,289
2,866 (14,717)
3,556
(3,556)
0
0
2,133
733
2,866 (14,717)
(1,142)
13,065
11,923
26,640
991
13,798
14,789
11,923

Page 27

RMIG ENDOWMENT TRUST

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 MARCH 2022

14. ANALYSIS OF CHANGES IN CASH AND CASH EQUIVALENTS LESS DEBT

Cash and cash equivalents
Cash at bank and in hand
Borrowings
Bank loans due within one year
Bank loans due after one year
Total cash and cash equivalents less debt		 At 1 April
Cash Flow
Non-Cash At 31 March
2021
Changes
2022
£'000
£'000
£'000
£'000
1,739
2,745
0
4,484
1,739
2,745
0
4,484
0
0
(193)
(193)
0
(670)
193
(477)
0
(670)
0
(670)
1,739
2,075
0
3,814

15. ULTIMATE CONTROLLING PARTY

The ultimate controlling party is the Masonic Charitable Foundation (Registered Charity No. 1164703, Company Number 09751836), which is the sole member of the company. Consolidated accounts for the MCF, which include the accounts of the Charity, can be obtained from the registered office of the Charity.

Page 28