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2021-03-31-accounts

2020/21

The Federation of Groundwork Trusts

Annual Report and Financial Statements

2 Contents

Contents

About Groundwork UK 3
Chair’s statement 5
Governance 6
Objectives and public beneft 8
Strategic report 9
Performance overview 10
Sustainable development 16
Plans for the future 18
Financial performance 20
Risks and uncertainties 22
Trustees’ responsibilities 23
Independent auditor’s report 24
Statement of fnancial activities 27
Charity balance sheet 28
Cash fow statement 29
Notes forming part of the fnancial statements 30
Advisers 46
The Board of Trustees 47

Charity registration number 291558 The Federation of Groundwork Trusts Company registration number Operating as Groundwork UK 01900511

Registered office

Suite B2, The Walker Building 58 Oxford Street, Birmingham B5 5NR

Annual Report and Financial Statements 2020/21

3

About Groundwork UK

About Groundwork UK

Groundwork is a federation of charities mobilising practical community action on poverty and the environment across the UK.

We’re passionate about creating a future where:

We believe that working with local communities to build their resilience is vital in facing up to the challenges of a globalised economy and a changing climate.

This means creating green jobs that build wealth in local communities, changing behaviour to reduce wasted food, energy and water, providing biodiverse, accessible green spaces, supporting businesses to be more responsible and empowering communities to lead activities that improve their quality of life and promote health and wellbeing.

Groundwork harnesses the passion, skills and experience of more than 1,200 employees and around 100 volunteer trustees across the UK. In 2020/21, the Groundwork federation delivered projects and programmes to

a value of some £78 million involving and benefiting more than 1.8 million people.

Groundwork UK is the central body of Groundwork, responsible for the brand, systems and agreements that hold the federation together. We add value to Groundwork’s local activities by building the organisation’s profile, developing relationships with national partners, funders and commissioners, unlocking resources and managing programmes and contracts delivered by Groundwork Trusts and others. We act as Groundwork’s national voice in the outside world and help all parts of Groundwork gain the benefits of being in a federation by providing opportunities to collaborate, share skills and learn from good practice.

Groundwork UK is registered as a company and charity under the name The Federation of Groundwork Trusts, denoting its status as the membership body for Groundwork Trusts. This report outlines the activity, priorities and financial position of Groundwork UK and sits within the wider narrative about Groundwork’s collective achievements, which can be found in our federation impact report - Our impact | Groundwork

Groundwork UK

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Chair’s statement

5

Chair’s statement

This has been a year like no other for anybody running a business or charity, and I am full of pride and admiration at how our organisation has responded to the existential challenges presented by the Covid crisis.

Groundwork UK sits at the centre of a federation that has shown immense flexibility, creativity and commitment in ensuring programmes keep running and services are delivered in the most testing of circumstances.

We shouldn’t be surprised - Groundwork’s origins lie in the economic recession of the 1970s and our organisation was established as a radical experiment in bringing together public and private resources to support communities to tackle social and environmental challenges.

Over the last four decades we’ve learned what works to help community organisations become more resilient, to help young people

face the future with confidence and to help those who are vulnerable or isolated improve their prospects and networks.

This learning enabled us to adapt our ways of working to support those who most need it through the pandemic – providing emergency grants to local organisations, helping young people stay connected and finding innovative ways to encourage people to enjoy the natural world.

The UK Government has

committed to a number of longerterm priorities which will present important opportunities to position Groundwork as an organisation able to support communities through the ongoing crisis and to help local areas plan for a future recovery. In particular, the commitment to ‘levelling up’ the UK in terms of economic prospects and the promise of a ‘green recovery’, which tackles the climate and nature emergency at the same time as the health and economic crisis, provide

a platform for promoting the value of Groundwork’s approach to local sustainable development.

As we enter our 40th year of operation, the experimental approach and entrepreneurial spirit of those Groundwork pioneers needs to be at the forefront as we apply ourselves to the challenges ahead. Our aim is to support a recovery that is both green and fair, that puts communities in control of the decisions that affect them and that helps to create a society that promotes healthier and more sustainable lifestyles.

I would like to thank all those within our federation – and those who have been steadfast partners over this difficult period. I hope you’ll continue to support us as we set out on the next exciting phase of our organisational journey.

Graham Hartley, Chair 20 September 2021

Groundwork UK

6

Governance

Governance

Registration numbers Charity Registration Number: 291558

Company Registration Number: 01900511

How we are organised and governed

Groundwork UK is the operating name of The Federation of Groundwork Trusts, a charity and a company limited by guarantee. The governing documents are its Memorandum and Articles of Association, which were last amended by written resolution on 6 December 2018.

Membership of Groundwork UK comprises Groundwork Trusts. Groundwork Trusts are organisations, which are registered charities and companies limited by guarantee with similar objects to Groundwork UK but delivering in local areas within the UK. A membership agreement sets out our internal roles, relationships and behaviours and the whole of Groundwork operates to a single, common strategy, which is overseen by our Board of Trustees.

The Board of Trustees comprises the trustees of Groundwork UK in accordance with the Charities Act 2011, who are also the directors of the company in accordance with the Companies Act 2006. The majority of our trustees are appointed from the boards of our member Groundwork Trusts.

A number of independent trustees, including our Chair, are co-opted by the Board on account of their skills, experience or networks.

Our trustees are responsible for ensuring Groundwork UK is managed effectively and efficiently with appropriate systems, processes and policies governing our fundraising and financial management, our assets and investments and our responsibilities to our staff, volunteers and beneficiaries. Trustees pay particular attention to our responsibilities in respect of health and safety, safeguarding, data protection and information security, and we also have trustee champions overseeing our work to reduce our carbon footprint and promote equity, diversity and inclusion across our organisation.

The work of the Board is supported by four sub-committees:

• Groundwork UK Committee

• Groundwork UK Audit Committee

• Federation Executive Team

• Chairs’ Committee

As a charity supporting young people to play an active role in their communities, we want to ensure that our strategic decision-making and operational plans are informed by the views of young people. Our Youth Advisory Board meets regularly, acting as a sounding board for our internal teams and providing a platform for building and supporting a wider network of young people to improve their own lives and neighbourhoods.

Groundwork UK’s Management Team is led by the Chief Executive and includes senior staff members responsible for financial management and corporate services, fundraising, communications and programme performance. This team operates through delegated powers outlined in our financial regulations and provides regular reports on financial and operational performance and risk management.

Annual Report and Financial Statements 2020/21

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Governance

Relationships within Groundwork

Groundwork is a federation of independent charities, each working under a common brand to a common strategy. This strategy sets the direction, milestones and targets, which influence operational decision-making across all parts of Groundwork and against which executives hold each other to account. Within this strategic framework Groundwork Trusts make their own decisions about the project work they develop and deliver.

Groundwork UK delivers

services and activities to support Groundwork Trusts by building brand and profile, generating income for local delivery and supporting quality and impact. Groundwork UK is held to account for its performance by its members. Each Groundwork Trust signs a membership agreement, which sets out the commitments made by all parts of Groundwork in relation to quality, governance and ways of working and defines the services Groundwork UK will deliver on behalf of the federation.

The appointed trustees of

Groundwork UK are also trustees of Groundwork Trusts but are not considered to be related parties under the definition of the SORP and transactions between Groundwork UK and Groundwork Trusts do not require separate disclosure. Groundwork UK has considered the other disclosure requirements of the SORP and believes that there are no other related party transactions except for those between itself and its wholly owned subsidiary companies, as listed on page 38.

Our commitments

The Board is committed to the principles of good governance set out in the Charity Commission

Governance Code and all boards within Groundwork have reviewed their performance against this standard in the last year.

Our federation strategy sets out the principles which underpin all of our work.

• We will invest in the places and people that need us most

• We will work with local leaders and listen to local voices

• We will grow a culture of equity and inclusion

• We will be committed to collaboration

• We will act as environmental exemplars

The Groundwork UK staff team has agreed a set of values to inform the way we work and behave. We will be environmentally aware and focused on communities in need .

We will be collaborative , show integrity and strive for quality in everything we do.

Our decisions, actions and operations are also guided by our sustainable development policy, which sets out how we will contribute to creating a strong and just society living within environmental limits, and this year we will be working with colleagues from across Groundwork to measure our collective carbon footprint and agree an action plan aimed at achieving ‘net zero’ emissions.

As a charity dedicated to supporting people who may be vulnerable we are committed to ensuring our operations are delivered safely and that our staff, volunteers and service users are able to speak freely about any concerns they have. We have a Groundworkwide commitment to effective safeguarding – including e-safety - and comprehensive complaints and whistleblowing procedures.

Our work is designed to address the needs of all sections of the community and we provide equal access to our services regardless of people’s backgrounds, circumstances or characteristics. We have a national working group advising the Board on effective ways of promoting equity, diversity and inclusion across our federation. We monitor levels of diversity within our staff team to ensure it reflects the communities of which we are a part and gather feedback from colleagues about our culture and employment practices to ensure they are as inclusive as possible.

Groundwork UK is registered with the Fundraising Regulator and complies with all relevant codes of practice. All of our fundraising is managed internally and we do not employ commercial participators or professional third-party fundraisers.

Groundwork UK

Objectives and public benefit

8

Objectives and public benefit

Groundwork UK’s charitable objectives are set down in its Memorandum of Association and date from the interpretation of charitable activities when they were drafted in 1985, as amended at annual general meetings and by written resolution. They commit Groundwork UK to delivering and promoting regeneration and sustainable development as follows.

Groundwork UK’s trustees have referred to the Charity Commission’s general guidance on public benefit when reviewing the organisation’s objectives and planning future activities. In particular, the trustees consider how planned activities will contribute to the charitable objectives set out above. Further details about the impact of Groundwork UK’s activities during 2020/21 can be found on the following pages.

Annual Report and Financial Statements 2020/21

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Strategic report

Strategic report

for the year ended 31 March 2021

The Board of Trustees presents its report for the year ended 31 March 2021. This includes:

Groundwork UK

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Performance overview

Performance overview

At the start of 2020 the whole Groundwork federation approved a new, three-year strategy intended to guide and underpin our national and local operations. The strategy reaffirmed and updated Groundwork’s mission statement with a renewed commitment to mobilise practical action on poverty and the environment. This was accompanied by a sharper focus on activity to address climate change and to tackle inequality on the basis that ‘no-one should be held back by their background or circumstances’.

The strategy was finalised in March 2020, just as the world was turned upside down by the onset of the Covid pandemic.

The experience of the pandemic demonstrated that the strategy sets out exactly the right priorities for our organisation. Covid has highlighted and exacerbated social and health inequalities, exposing the fragility of many people’s employment conditions (especially young people) and the vastly differing ability of people to cope with the experience of lockdown, whether in relation to the costs of being at home, the isolating effect of digital exclusion or the inability to access open spaces to support physical health and mental wellbeing.

As our society begins to open up and we cautiously look to the future, the focus of governments and local authorities is on the need and opportunity to deliver a ‘green recovery’, re-setting the economy and regenerating communities so that we lock in some of the sustainability upsides the pandemic has brought but also create new economic opportunities that take us towards our national and global targets for net zero.

Across the Groundwork federation we saw innovative responses to these challenges and opportunities.

Financially we have navigated potential pitfalls using emergency support funds available from government and other funders, and in some parts of the federation we have secured major new programmes of work.

Although total federation turnover is down by 12% on the previous year, this has been managed effectively so that reserves have, in the main, been protected, and in some cases strengthened.

Annual Report and Financial Statements 2020/21

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Performance overview

Delivery impact

In spite of – and in response to – the pandemic, we have continued to deliver impact across all three of our priority areas:

• Better places

• Improved prospects

• Greener choices

In developing our federation strategy we set ourselves a number of collective three-year delivery targets. Performance against those targets is set out below.

Target Progress
By 2023 we will have: Year 1
• mobilised 75,000 days • 25,590 volunteer
of voluntary action to days, including
combat the climate and business volunteers
nature emergency
• improved the wellbeing • 4,844 young people
of 50,000 people by experiencing a positive
connecting them with personal outcome
their community and
with nature • 15,461 people
supported to adopt
greener behaviours
• helped 20,000 people • 2,589 people
improve their life supported into
chances by accessing education, training
learning and work or work

A review of our federation-wide performance measures at the end of year 1 highlights a number of trends as follows.

Groundwork UK

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Performance overview

Building a Better Groundwork

Our strategy contains a number of actions designed to strengthen our organisational resilience and grow our collective impact. A summary of progress against these actions is provided below.

Action Progress
Improve our communications and fundraising Strong progress in communications with active
capabilities and drive innovation in income network of specialists developing coordinated
generation to diversify our range of revenue campaign plans. Initial conversations underway to
sources explore a more connected approach to fundraising,
including e-commerce opportunities.
Develop new business models to enable our Improved delivery structures and marketing plans in
specialist teams to offer commercial services across place to support Sustainable Business Services and
larger areas of the country Landscape Architecture. Work underway to develop
more connected national service offer for Green Doctor.
Improve our ability to capture data that Initial work completed with external support to develop
demonstrates the impact of our work and helps an ‘impact framework’ enabling delivery outcomes to be
us prioritise the actions that contribute most to planned, tracked and assessed. More work needed to
achieving our mission refne data captured and agree common tools.
Embed a new set of quality standards and Groundwork Quality Standards now in place and
harmonised systems to ensure that all parts Federation Business Management Group meeting
of Groundwork are operating effciently and regularly to review and improve processes and
effectively systems.
Undertake governance reviews across our Reviews completed or in progress in all Trusts with
federation to improve practice in line with the resulting actions underway. Governance a major focus
Charity Commission’s governance code of our federation EDI plan (see below).
Drive a federation-wide initiative to improve the Action plan and federation working group in place.
way we promote equity, diversity and inclusion Data capture in progress and proposal developed to
engage external support to drive pace of change.
Seek opportunities to consolidate structures and Signifcant progress in north and south England with
share services so that all parts of the country more consolidated structures, improved balance
are served by a strong and high-performing sheets and more extensive collaboration. Work
Groundwork organisation underway to develop more shared activity in central
England and increased level of dialogue between
Trusts in Wales and Northern Ireland.

Annual Report and Financial Statements 2020/21

Perform3nCeovervi￿V 13 ro UK

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Performance overview

Groundwork UK

Groundwork UK’s business plan is used to track trends in our operational and financial performance, and provide a headline assessment of our achievements in fundraising, profile raising, programme delivery and quality improvement, including feedback from stakeholders. Performance reports are provided to our trustees on a quarterly basis with financial KPIs tracked through monthly management accounts and used to inform regular re-forecasts of our financial position.

2020/21 was a year of strong performance by the Groundwork UK team, with our key performance indicators for the year substantially met or showing an improving trend by the year end. We closed the year with surplus funds in excess of £380k and our reserves policy met, ensuring we are in a position to invest in the capacity and activities that will enable the whole of Groundwork to play a part in the post-Covid recovery.

The last year has seen a number of successes which have contributed to our strong end of year performance and which build the foundations for the coming years. Our role as a provider of community grants saw us work rapidly with our key funding partners Tesco and Comic Relief to design and deliver emergency funding programmes for community groups on the front line of the pandemic response.

This coincided with an extension of our agreement with HS2 to distribute increased funds to support communities and local economies linked to phase 2a of the project. We were also invited by the Access Foundation to develop a new programme of financial and training support for environmental enterprises.

Between April 2020 and March 2021 we distributed more than 16,000 grants to a value of almost £19 million on behalf of the Ministry of Housing, Communities and Local Government, the Greater London Authority, Tesco and OneStop, Comic Relief, HS2, the Education and Skills Funding Agency and the property company Avison Young.

During the year we have mobilised or extended programmes of local delivery by Groundwork Trusts and other partners. Our Natural Neighbourhoods programme (funded through the Government’s Green Recovery Challenge Fund) will see us employing 100 young people and working with 360 volunteers to improve more than 70 green spaces in communities across the North and Midlands and our Future Proof Parks programme, inspiring young people to get involved as volunteers in their local parks and green spaces, reaches its culmination with a national communications drive designed to ensure a strong legacy by inspiring young people across the country to take action in their own neighbourhoods.

Annual Report and Financial Statements 2020/21

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Performance overview

Although heavily disrupted by the pandemic, our programmes of Green Doctor delivery, funded by the Ofgem Redress Fund and Cadent Foundation, have offered a lifeline to people trapped in fuel poverty. Similarly, we have continued to support young people and those who are unemployed to mitigate the impacts of lockdown on their mental health and future prospects. We completed our programme of adult learning at the end of the academic year, having supported more than 450 learners over the last 4 years with a 90% achievement rate. At the same time we introduced our new, federation-wide training programme for young people employed through the Kickstart scheme and received the welcome news that our Building Better Opportunities Progress programme in the West Midlands will be extended to 2023.

Our investment in work to develop new corporate relationships has also begun to pay off. We have been approved as the charity partner of both Veolia and Balfour Beatty and secured more funds for Groundwork Trusts to improve open spaces in partnership with Coop Central England and NHS Property Services. We are continuing to make new links and manage a significant number of enquiries.

Our work to position and promote Groundwork through policy and research activity has continued to create opportunities. Our report on equity in access to urban nature was seen as timely and influential, and we have continued to advocate for investment in green skills and job creation.

Supporting the wellbeing of the Groundwork UK team has been one of our top priorities during the pandemic – recognising the personal and professional challenges presented by repeated lockdowns. This led to renewed activity to enable staff to connect informally and new opportunities to engage in online activities to promote physical health and mindfulness.

With our new office base open for business in central Birmingham, we are in the process of working through revisions to our staff handbook and relevant policies to underpin a commitment to more flexible working, allowing those who wish to continue benefiting from homeworking while regaining the benefits of being together in teams for the purposes of sharing and collaboration.

Groundwork UK

Sustainable development report

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Sustainable development report

Sustainable development is core to our charitable mission – helping communities and individuals develop the understanding and capability to take action and make choices that deliver social equity and economic prosperity while recognising the need to live within the earth’s finite natural resources.

The principles of sustainable development underpin the way we go about our work and environmental leadership is embedded in our federation strategy and in our organisational values. Our sustainable development policy commits us to reporting on how these principles are being put into practice within our own organisation.

As an expanding team, we continue to focus on ensuring that our staff adopt more sustainable practices at work. The pandemic – and associated move to homeworking – has made it necessary to switch from office-based behaviours to inspiring colleagues to take action at home, which we have done through a series of fun challenges around energy, upcycling and growing.

During the year our office base has moved from a large, inefficient building which we owned to smaller, better appointed, rented accommodation. While this brings positives in terms of a more modern, energy efficient space, it also means we will have less control over the supply of utilities etc. We will seek to engage constructively with our landlords about maximising the environmental performance of the wider development at the earliest opportunity.

To support our efforts to reduce our environmental footprint, a small team of volunteers has been working to progress a carbon reduction action plan, which is championed by a member of the Board’s Groundwork UK Committee. Priorities identified for the future include a refreshed approach to training and a review of our investment management arrangements to ensure they align with our wider environmental commitments.

To drive progress across the federation the Board has agreed that all parts of Groundwork should capture consistent data to enable a federation-wide carbon footprint to be calculated. This will then be followed by the development of a collective action plan with the aim of achieving net zero emissions by 2030.

We recognise that, as a small staff team, the greatest contribution we can make to sustainable development is through the programmes we develop and deliver. During the year we have secured funding for new programmes aimed at delivering ‘nature recovery’ (in particular our Natural Neighbourhoods programme) and also grown the scale of our Green Doctor programmes, which deliver direct CO2 reductions through energy efficiency advice. We are also working with colleagues across the federation to embed carbon literacy training into our programmes focused on employment support.

To inspire others to embark on their own journey of sustainability, we have committed to a federationwide communications campaign in the run-up to COP26 highlighting the importance of local action in tackling the global climate crisis. This includes working with the policy organisation New Local on a major report looking at the potential for local authorities and businesses to support community-led climate action.

Annual Report and Financial Statements 2020/21

SLlStain3blQd￿Qlopment )rt 17 ENERGY ffl HIGH5 rO1J￿Wr

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Our plans for the future

Our plans for the future

Groundwork’s collective delivery goals are that by 2023 we will have:

Our aims in this respect are to ensure we have:

Groundwork UK’s business plan sets out what we will do over the next year to help the federation work towards these strategic goals and aims.

In order to deliver these goals, we will continue improving our own capability and resilience to ensure we are putting maximum resource into our front line delivery and investing in the right skills to improve the quality of our services and management.

Annual Report and Financial Statements 2020/21

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Our plans for the future

In 2021/22 this means focusing on the following strategic priorities.

Visibility and credibility

Building Groundwork’s brand and profile, and providing a credible national voice with partners and funders, is the primary expectation of our Trusts and supports income generation across the federation. Our policy-led approach to positioning is working well, and our social media reach is growing. We now need to build on this by using our increased visibility to develop more extensive supporter networks to improve our fundraising performance and by working with colleagues across the federation to market Groundwork’s core services.

Grant management

Groundwork UK has built up considerable experience and expertise in helping public and private funders provide grants and support to local communities. This work increases Groundwork’s visibility and provides funding to support our work on communications and quality. Our priority is to maintain our existing strong relationships and continue to build a pipeline of new opportunities, while ensuring those we respond to continue to fit with our ‘community support’ mission.

Supporting local delivery

We continue to have an important role providing programme funds, supporting practitioner networking and driving quality across our federation. 2021/22 will see us leading some major national initiatives to support young people, improve green spaces and tackle fuel poverty, and we need to continue our work to unlock funds to support local delivery from public commissioners and private funders. Doing this successfully in a more consolidated federation will require us to work closely with service leads in Groundwork Trusts and to reassess where national support or leadership can add value to local development activities.

We recognise that the course of the pandemic, and the speed of the subsequent recovery, is hard to predict. This requires organisations to remain agile with the ability to respond to a dynamic set of circumstances. This plan is based on an assumption of a gradual return to pre-pandemic operations over the course of the year. The plan will be reviewed by Groundwork UK’s management team on a quarterly basis, and more frequently if necessary, with significant changes discussed and agreed with trustees.

Groundwork UK

20

Financial performance

Financial performance

Our long-term financial strategy has three clear and linked strands as follows:

Net incoming resources for

2020/21 totalled £24 million (2020: £25 million). Our organisational turnover is heavily dependent on the volume of grants we distribute, which fluctuates from year to year, and is not considered to be the determining factor in our assessment of financial health. Our underlying trading performance resulted in an unrestricted surplus of £387k (2020: £147k), compared to a budgeted surplus of £50k. The surplus includes an increase in the value of our investments of

£181k (budget £40k) following the recovery of markets since the sharp downturn in March 2020 as a result of Covid uncertainty. Other factors include an increase in programme activity to support communities during the pandemic and cost savings related to reduced travel and office overheads whilst staff have been working from home.

This positive outcome will help us bolster our reserves and cope with the financial uncertainties that we anticipate will lie ahead in the wake of the Covid crisis.

In addition to this income, we received funds and distributed grants totalling £4.9 million, funds for which we are responsible but which are not included in our stated turnover.

4.1 Reserves

In line with our financial strategy, our trustees have agreed that we should aim to hold 12 months operating costs (c£2.3 million) in liquid reserves. We believe this is appropriate for the following reasons:

Our reserves policy recognises the need to operate as a responsible charity, maintaining trust with our partners and the public by not generating surpluses for which there is no future requirement or that are used for purposes which are not directly connected to our charitable aims.

Our level of free liquid reserves at the end of 2020/21 is £2.4 million.

Restricted funds - advance payments from funders pending completion of project work by Groundwork Trusts and other delivery partners – stand at £3.1 million (2020: £1.2 million). These restricted funds can only be used in accordance with agreements reached with funders and do not form part of the general reserves that are under the control of the trustees.

Annual Report and Financial Statements 2020/21

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Financial performance

These funds will all be distributed during 2021/22. Movements in restricted funds reflect the longterm nature of Groundwork UK’s programme activity and this in no way reflects on the organisation’s financial efficiency or performance.

4.2 Investments

The majority of the funds obtained by Groundwork UK are for the delivery of specified projects and are therefore restricted. These funds are mainly distributed to Groundwork Trusts and other delivery partners operating under contract or to third party organisations in the form of grants to support local community projects. Any funds that are built up in advance of expenditure are kept as liquid as possible, whilst making every effort to maximise investment returns.

Cash that is unrestricted in nature and is not required in the short term (regarded as six months) is considered for long-term investment. Since 2010 we have invested these funds in a managed fund arrangement with a current target to deliver an annual return of between 3% and 4% above the Consumer Prices Index. In the last year, our investments made a surplus of £181k (c19%) due to the recovery of financial markets, following a sharp fall due to the Covid crisis in March 2020. All of these funds can be converted into cash without notice or penalty, should there be an immediate need for liquid funds.

4.3 Grant making policy

Groundwork UK delivers its mission primarily by distributing funds to Groundwork Trusts, other delivery partners and to community groups. These funds are considered to be performance-related grants and are recognised in these financial statements to the extent that the projects which they are funding have been completed.

All grant programmes have specific guidelines, criteria and priorities with a formal process of approval.

4.4 Principal funding sources

Our major sources of funding during the last year are set out below.

• Private sector

- £10.5 million

(2020: £13.9 million)

This includes funds provided by businesses and private foundations, most notably £8.5 million provided by Tesco to support community groups through the Community Grants programme.

• Public sector

- £8.5 million

(£8.4 million in 2019/20). This relates to funding secured from government departments and other public bodies to deliver programmes and services. In particular in 2020/21 this included the Ministry of Housing, Communities and Local Government and the Education and Skills Funding Agency.

• Lottery and charitable foundations

- £4.7 million

(£2.1 million in 2019/20).

These include grants secured from the National Lottery Heritage Fund and Community Fund to support local delivery and funds distributed to community groups on behalf of Comic Relief, including additional funding to provide support to communities during the pandemic.

4.5 Expenditure on charitable objectives

Our expenditure in the year was directed towards the following charitable activities

• Community grants

• Programme delivery

• Programme management

£980k (2020: £1 million).

The costs of managing grant distribution and local delivery programmes, including reporting impact and generating learning from our delivery to improve practice and influence future policy.

• Fundraising

£116k (2020: £157k).

The cost of generating resources to support local delivery through campaigns, communications and bidding activities.

• Supporting our federation

£300k (2020: £286k).

Providing systems and support services to enable Groundwork Trusts to communicate effectively, share knowledge and collaborate to achieve greater impact.

• Running our organisation

£633k (2020: £624k).

Ensuring Groundwork UK operates safely and efficiently with appropriate systems, quality standards and premises.

Groundwork UK

22

Risks and uncertainties

Risks and uncertainties

Our trustees understand their responsibilities for ensuring that the major risks to which the charity is exposed are identified and reviewed, and that there are systems in place to mitigate them.

Trustees regularly review our risk management process and receive quarterly updates on actions put in place to mitigate the most significant ongoing risks. Risks are identified by our staff teams and reviewed on a regular basis by our management team. All of Groundwork UK’s major programmes are managed on a risk basis with individual risk registers used both as management and reporting tools. We have a comprehensive business continuity plan in place which is designed to ensure our operations can continue safely in the event of a crisis or disaster situation. This has been fully tested by the Covid pandemic.

Groundwork UK is likely to be delivering its mission in 2021/22 against a backdrop dominated by the aftermath of the social and economic emergency created by the Covid-19 pandemic. This will continue to affect what we do, how we work and the funds available to sustain our operations.

While the course of the pandemic and subsequent recovery is far from clear, we can anticipate a number of impacts on our business as follows.

The major areas of potential risk, for which we have active mitigation strategies in place, are as follows:

5.1 Financial instruments

Groundwork UK’s financial risk management objective is broadly to seek to make neither profit nor loss from exposure to currency or interest rate risks. Our policy is to finance fixed assets and working capital through retained reserves.

Annual Report and Financial Statements 2020/21

Statement of trustees’ responsibilities

23

Statement of trustees’ responsibilities

Our trustees are responsible for preparing Groundwork UK’s Annual Report and Financial Statements in accordance with applicable law and regulations.

Company law requires the trustees to prepare financial statements for each financial year in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the trustees 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 charity and of the incoming resources and application of resources, including the income and expenditure of the charity for that period.

In preparing these financial statements, the trustees are required to:

Our trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charity’s transactions and disclose with reasonable accuracy at any time the financial position of the charity 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 charity and taking reasonable steps for to prevent and detect fraud and other irregularities.

These financial statements are published on our website in accordance with UK legislation governing the preparation and dissemination of financial statements. The maintenance and integrity of the website is the responsibility of the trustees. The trustees’ responsibility also extends to the ongoing integrity of the financial statements published.

Events after the year end There have been no material events after the year end to report

Disclosure of information by the trustees to the auditor

Each of the trustees has confirmed that, so far as they are aware, there is no relevant audit information of which Groundwork UK’s auditor is unaware, and that they have taken all the steps that they ought to have taken as a trustee in order to make themselves aware of any relevant audit information and to establish that Groundwork UK’s auditor is aware of that information.

Signed on behalf of the Board of Trustees

Graham Hartley, Chair 20 September 2021

Groundwork UK

Independent auditor’s report

24

Independent auditor’s report

to members of THE FEDERATION OF GROUNDWORK TRUSTS (TRADING AS GROUNDWORK UK)

Opinion

We have audited the financial statements of Groundwork UK (The Federation of Groundwork Trusts) (“the Charitable Company”) for the year 31 March 2021 ended which comprise the statement of financial activities, the balance sheet, the 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).

In our opinion, the financial statements:

Basis for opinion

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

Conclusions related

to going concern

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

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

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

Other information

The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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 this gives rise to 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.

Annual Report and Financial Statements 2020/21

Independent auditor’s report

25

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the 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 requires us to report to you if, in our opinion;

Responsibilities of Trustees

As explained more fully in the Directors’ responsibilities statement, the Trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out 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/ auditorsresponsibilites . This description forms part of our auditor’s report.

Extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charitable company and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, the Charities Act 2011 together with the Charities SORP (FRS 102).

Groundwork UK

Independent auditor’s report

26

We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company and the group for fraud. The laws and regulations we considered in this context for the UK operations were General Data Protection Regulation (GDPR), Health and Safety and Employment legislation.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing of recognition of income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management and the Audit Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, designing procedures over income, reviewing accounting estimates for biases, designing audit procedures over income, reviewing regulatory correspondence with the Charity Commission and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing noncompliance and cannot be expected to detect non-compliance with all laws and regulations.

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. Our audit work has been undertaken so that we might state to the Charitable Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charitable Company and the Charitable Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Helen Drew (Senior Statutory Auditor)

For and on behalf of Crowe U.K. LLP, Statutory Auditor Black Country House, Rounds Green Road, Oldbury, West Midlands, B69 2DG.

Date: 16/12/2021

Annual Report and Financial Statements 2020/21

Statement of financial activities

27

STATEMENT OF FINANCIAL ACTIVITIES

FOR THE YEAR ENDED 31 MARCH 2021

Note
INCOME FROM
Donations and legacies
2
Charitable activities
3
Other trading activities
2
Investments
2
Total
EXPENDITURE ON
Raising funds
4
Charitable activities
5
Total
Net gains (loss) on investment
10
Net income
Transfers between funds
Net (income/expenditure) after transfers
OTHER RECOGNISED GAINS
Gains on revaluation of fixed
assets for charity’s own use
Net movement in funds
RECONCILIATION OF FUNDS
Fund balances brought forward
16
Fund balances carried forward
16		 2021
2021
Unrestricted
funds
General
Designated
£
£
13,890
-
3,280,784
-
106,742
-
30,289
-
3,431,705
-
18,213
-
3,207,756
180,581
3,225,969
180,581
180,946
-
386,682
(180,581)
(50,000)
50,000
336,682
(130,581)
-
-
336,682
(130,581)
1,722,416
485,370
2,059,098
354,789		 2021
Restricted
funds
£
5,445
20,919,006
-
-
20,924,451
116,132
18,909,638
19,025,770
-
1,898,681
-
1,898,681
-
1,898,681
1,211,609
3,110,290		 2021
Total
£
19,335
24,199,790
106,742
30,289
24,356,156
134,345
22,297,975
22,432,320
180,946
2,104,782
-
2,104,782
-
2,104,782
3,419,395
5,524,177		 2020
Total
£
11,848
24,847,286
189,607
123,100
25,171,841
157,058
24,072,171
24,229,229
(95,847)
846.765
-
846,765
82,500
929,265
2,490,130
3,419,395

Incoming resources and resources expended derive from continuing operations. The company has no other recognised gains or losses other than those passing through the statement of financial activities. The notes on pages 30 to 44 form part of these financial statements.

Groundwork UK

28

Charity balance sheet

CHARITY BALANCE SHEET

AT 31 MARCH 2021

Note
FIXED ASSETS
Tangible assets
9
Investment property
9
Investments
10
CURRENT ASSETS
Investments
Debtors
11
Cash at bank
Creditors:amounts falling due within one year
12
Net current assets
Total assets less current liabilities
Creditors:amounts falling due after one year
13
Net assets
15
RESERVES:Unrestricted funds
General Funds
16
Designated funds
16
Investment property revaluation
16
Restricted funds
16		 2021
£
£
60,275
-
1,545,555
1,605,830
-
11,650,081
8,405,251
20,055,332
(16,136,985)
3,918,347
5,524,177
-
5,524,177
2,059,098
354,789
-
3,110,290
5,524,177		 2020
£
£
1,119,189
1,110,000
3
2.229,192
874,606
13,459,209
5,405,389
19,739,204
(18,225,180)
1,514,024
3,743,216
(323,821)
3,419,395
1,312,416
485,370
410,000
1,211,609
3,419,395		 2020
£
£
1,119,189
1,110,000
3
2.229,192
874,606
13,459,209
5,405,389
19,739,204
(18,225,180)
1,514,024
3,743,216
(323,821)
3,419,395
1,312,416
485,370
410,000
1,211,609
3,419,395
2.229,192
1,514,024
3,743,216
(323,821)
3,419,395
1,312,416
485,370
410,000
1,211,609
3,419,395

These finance statements were approved by the Board of trustees and authorised for issue on and were signed on its behalf by: Graham Hartley, Chair 20 September 2021

The notes on pages 30 to 44 form part of these financial statements.

Annual Report and Financial Statements 2020/21

Groundwork UK

Cash flow statement

29

CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 MARCH 2021

Note
CASH FLOW FROM OPERATING ACTIVITIES
Net cash provided by operating activities
20
CASH FLOWS FROM INVESTING ACTIVITIES
Dividends, interest and rents from investments
Purchase of property, plant and equipment
Purchase of investments
Disposal of Property
NET CASH PROVIDED BY INVESTMENT ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of borrowing
Change in cash and cash equivalents
in the reporting period
Cash and cash equivalents at the beginning
of the reporting period
Cash and cash equivalents at the end of the
reporting period		 2020/21
£
1,622,445
30,289
(59,051)
(490,000)
2,220,000
3,323,683
(323,821)
2,999,862
5,405,389
8,405,251		 2019/20
£
(263,182)
128,324
(12,164)
-
-
(147,022)
(77,736)
(224,758)
5,630,147
5,405,389

Movement in Net Debt

At 1 April 2020
£
5,405,389
(77,737)
Cash at bank and in hand
Debt due within 1 year
Debt due over 1 year
(323,821)
5,003,831		 Cash fows
At 31 March 2021
£
£
2,999,862
8,405,251
77,737
-
323,821
-
3,401,420
8,405,251		 Cash fows
At 31 March 2021
£
£
2,999,862
8,405,251
77,737
-
323,821
-
3,401,420
8,405,251
8,405,251

The notes on pages 30 to 44 form part of these financial statements.

Groundwork UK

Notes forming part of the financial statements

30

Notes forming part of the financial statements FOR THE YEAR ENDED 31 MARCH 2021

1. Accounting policies

The following accounting policies have been applied consistently in dealing with items, which are considered material in relation to the financial statements.

a) Basis of preparation

The financial statements have been prepared under the historical cost convention and comply with the Companies Act 2006. The financial statements have been prepared in accordance with applicable Accounting Standards and comply with the requirements of the Statement of Recommended Practice, “Charities SORP (FRS 102)”.

The trustees and senior management consider that there are no material uncertainties about the charity’s ability to continue as a going concern.

The results of acquisitions are accounted for from the relevant date of acquisition under the acquisition method of accounting.

Accounting policies are supplemented by estimation techniques where judgement is required in measuring the value of income and expenditure and of assets and liabilities.

b) Grants and other income

Revenue and capital based grants are credited to the statement of financial activities in the year in which they are received or become receivable under the terms of a grant agreement.

Where grants are considered to be performance related, income is recognised to the extent that the services outlined in the funding agreement had been performed by the year end. Where income has been received but the related services had not been performed by the year-end, the balance is carried forward as deferred income.

Donations are accounted for on a cash received basis. Rental income is recognised in the period to which it relates.

Incoming resources have been allocated between the key strategic areas of activity on a basis consistent with the allocation of expenditure (note 1(d)).

c) Grants payable

Grants offered to Groundwork Trusts and other organisations are typically paid in stages, with stage payments dependent upon the submission of claims detailing the work that has been completed. Claims which fall due within the year, which relate to work completed before the yearend, have been accrued for if they had not been paid during the year.

d) Expenditure

All expenditure is accounted for on an accruals basis and has been listed under headings that aggregate all the costs related to that activity. Where costs cannot be directly allocated, they have been allocated to activities on a basis consistent with the use of resources.

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

31

Costs of raising funds relate to the cost of external promotion and publicity to raise the profile of the charity and its objectives and costs associated with bids for funding.

Direct costs of charitable activities are those costs, which have been expended on delivery programmes. Support costs have been allocated to the key strategic areas of activity on the basis of the percentage of staff time spent on each of these areas.

e) Funds

Unrestricted funds are those which are available for use at the discretion of the Board of Trustees in furtherance of the general objectives of the charity. The Board may, at its discretion, set aside unrestricted funds for specific future purposes and these are referred to as Designated Funds. Where such funds are no longer required for the intended purposes they are released back to general unrestricted reserves.

Restricted funds are those which can only be used for purposes specified by the donor, or which have been raised under the terms of a specific bid. Expenditure under the terms of the grant agreement is shown as restricted expenditure.

f) Depreciation

Tangible fixed assets are stated at cost less provision for depreciation. Depreciation is calculated so as to write off the cost less the estimated residual value of tangible fixed

assets by equal annual instalments over their estimated useful economic lives as follows:

Leasehold buildings: 50 years Office equipment: 4 years Computer equipment: 3 years

g) Pensions

The company contributes to two defined contribution schemes. Contributions are charged to the statement of financial activities as they become payable.

h) Operating leases

Rentals paid under operating leases are charged to the statement of financial activities on a straight-line basis over the life of the asset.

i) Provisions

Provisions for future liabilities are recognised when the charity has a legal or constructive obligation that can be reliably estimated and for which there is an expectation that payment will be made.

j) Fixed asset investments

Investments held are valued at market value. Unrealised gains and losses on the revaluation of investments are recognised in the statement of financial activities.

k) Judgments in applying accounting policies and key sources of estimation uncertainty The Board of Trustees have not made any significant judgments or estimations during the preparation of the financial statements.

Groundwork UK

Notes forming part of the financial statements

32

2. Incoming resources Incoming resources from generated funds

VOLUNTARY INCOME
Donations and gifts
OTHER TRADING ACTIVITIES
Rental income
Membership Fee
INVESTMENT INCOME
Rental income
Dividends
Bank interest
VOLUNTARY INCOME
Donations and gifts
OTHER TRADING ACTIVITIES
Rental income
Membership Fee
INVESTMENT INCOME
Rental income
Dividends
Bank interest		 2021
Unrestricted
£
13,890
13,890
4,242
102,500
106,742
-
26,860
3,429
30,289
2020
Unrestricted
£
11,848
11,848
64,207
125,400
189,607
58,983
32,130
31,987
123,100		 2021
Designated
£
-
-
-
-
-
-
-
-
-
2020
Designated
£
-
-
-
-
-
-
-
-
-		 2021
Restricted
£
5,445
5,445
-
-
-
-
-
-
-
2020
Restricted
£
-
-
-
-
-
-
-
-
-		 2021
Total
£
19,335
19,335
4,242
102,500
106,742
-
26,860
3,429
30,289
2020
Total
£
11,848
11,848
64,207
125,400
189,607
58,983
32,130
31,987
123,100

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

33

3. Incoming resources Incoming resources from charitable activities

2021
Unrestricted
£
Income for project delivery was secured from the following sources:
Central government
251,158
Local authorities
234,226
Public agencies
722,964
Private sector
1,588,439
National Lottery & Charitable foundations
483,997
3,280,784
Income was allocated to:
Programme delivery
2,999,237
Programme management
144,330
Federation support
44,107
Running Groundwork UK
93,110
3,280,784
2020
Unrestricted
£
Income for project delivery was secured from the following sources:
Central government
371,726
Local authorities
159,682
Public agencies
734,293
Private sector
2,150,875
National Lottery & Charitable Foundations
338,037
Other
29,729
3,784,342
Income was allocated to:
Programme delivery
3,476,989
Programme management
164,360
Federation support
44,903
Running Groundwork UK
98,090
3,784,342		 2021
Designated
£
-
-
-
-
-
-
-
-
-
-
-
2020
Designated
£
-
-
-
-
-
-
-
-
-
-
-
-		 2021
Restricted
£
-
3,058,978
4,238,281
8,897,082
4,724,665
20,919,006
19,123,798
920,277
281,239
593,692
20,919,006
2020
Restricted
£
4,287,861
1,766,788
1,121,769
11,774,295
2,112,231
-
21,062,944
19,352,280
914,798
249,918
545,948
21,062,944		 2021
Total
£
251,158
3,293,204
4,961,245
10,485,521
5,208,662
24,199,790
22,123,035
1,064,607
325,346
686,802
24,199,790
2020
Total
£
4,659,587
1,926,470
1,856,062
13,925,170
2,450,268
29,729
24,847,286
22,829,269
1,079,158
294,821
644,038
24,847,286

Groundwork UK

Notes forming part of the financial statements

34

4. Cost of raising funds

Staff costs
Other costs
Staff costs
Other costs		 2021
Unrestricted
£
17,341
872
18,213
2020
Unrestricted
£
16,481
7,440
23,921		 2021
Designated
£
-
-
-
2020
Designated
£
-
-
-		 2021
Restricted
£
110,571
5,561
116,132
2020
Restricted
£
91,731
41,406
133,137		 2021
Total
£
127,912
6,433
134,345
2020
Total
£
108,212
48,846
157,058

5. Charitable activities

2021
Unrestricted
£
Expenditure on projects related to the following activities:
Programme delivery
2,932,475
Programme management
141,117
Federation support
43,126
Running Groundwork UK
91,038
3,207,756
Grants
payable
£
Expenditure on projects comprised:
Programme delivery
17,167,404
Programme management
826,131
Federation support
252,468
Running Groundwork UK
532,956
18,778,959		 2021
Designated
£
165,084
7,944
2,428
5,125
180,581
Other direct
costs of
activities
£
2,363,451
113,734
34,757
73,373
2,585,315		 2021
Restricted
£
17,286,869
831,880
254,224
536,665
18,909,638
Support
Costs
£
853,573
41,076
12,553
26,499
933,701		 2021
Total
£
20,384,428
980,941
299,778
632,828
22,297,975
2021
Total
£
20,384,428
980,941
299,778
632,828
22,297,975

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

35

5. Charitable activities (continued)
Expenditure on projects related to the following activities:
Programme delivery
Programme management
Federation support
Running Groundwork UK
Expenditure on projects comprised:
Programme delivery
Programme management
Federation support
Running Groundwork UK
Analysis of grants
Better places
Improving prospects
Greener behaviours
Analysis of grants
Better places
Improving prospects
Greener behaviours		 2020
Unrestricted
2020
Designated
2020
Restricted
£
£
£
3,530,457
153,778
18,432,871
166,888
7,269
871,337
45,593
1,986
238,045
99,598
4,338
520,011
3,842,536
167,371
20,062,264
Grants
payable
Other direct
costs of activities
Support
Costs
£
£
£
18,480,936
2,893,787
742,383
873,608
136,792
35,094
238,666
37,371
9,587
521,367
81,637
20,943
20,114,577
3,149,587
808,007
Grants to
institutions
Grants to
individuals
Grant
support costs
£
£
£
8,354,547
-
415,393
5,937,758
-
295,229
4,486,654
-
223,079
18,778,959
-
933,701
Grants to
institutions
Grants to
individuals
Grant
support costs
£
£
£
10,825,777
-
434,874
3,716,847
463,498
167,925
5,108,455
-
205,208
19,651,079
463,498
808,007		 2020
Total
£
22,117,106
1,045,494
285,624
623,947
24,072,171
2020
Total
£
22,117,106
1,045,494
285,624
623,947
24,072,171
2021
Total
£
8,769,940
6,232,987
4,709,733
19,712,660
2020
Total
£
11,260,651
4,348,270
5,313,663
20,922,584

For definitions of the above categories, see section 4.5 of the Strategic report

Groundwork UK

Notes forming part of the financial statements

36

5. Charitable activities (continued)


Support costs are analysed as follows:
Staff costs
Temporary staff and recruitment
Legal and professional
Travel and subsistence
Training and meetings
IT support
Other costs
6. Employees
The average monthly number of employees during the year was as follows:
Programme management
Management and administration
Fundraising and communications
The aggregated cost of these persons was as follows:
Wages and salaries
Social security costs
Pension costs (see note 20)
The emoluments of employees (excluding pension contributions)
over £60,000 per annum are disclosed in £10,000 bands as follows.
£60,000 - £70,000
£80,000 - £90,000
£90,000 - £100,000		 2021
£
683,226
6,817
22,949
5,685
9,888
108,857
96,279
933,701
2021
32
4
7
43
2021
£
1,340,815
131,583
209,023
1,681,421
2021
£
2
1
-		 2020
£
505,654
3,752
22,478
18,879
2,697
140,630
113,917
808,007
2020
31
4
7
42
2020
£
1,254.525
123,445
211,085
1,589,055
2020
£
3
1
-

The key senior management personnel of the charity are the Chief Executive Officer, Director of Finance and Corporate Services, Director of Partnerships and Programmes and the Head of Contracts with a total cost in 2021 of £310,189 (2020: £307,184). Total contributions under defined contribution schemes on behalf of these higher paid employees were £15,961 (2020: £15,803).

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

37

7. Transactions with trustees

During the year ended 31 March 2021 one trustee (2020: six) received reimbursed travel and subsistence expenses amounting in total to £206 (2020: £2,408). No trustees received any remuneration during the year.

8. Net incoming resources

2021 2020
£ £
Net incoming resources for the year is stated after charging:
Auditor’s remuneration:
Audit – company 14,000 13,650
Depreciation 7,965 11,294
Rentals payable under operating leases:
Equipment - -
Land and buildings - -

Premiums of £659 (2020: £644) were paid on a professional indemnity policy to protect the charity and trustees from loss arising from the neglect or defaults of trustees.

9. Tangible assets


COST OR VALUATION
At 1 April 2020
Additions
Revaluation reserve
Disposals
At 31 March 2021
DEPRECIATION
At 1 April 2020
Charged for the year
Disposals
At 31 March 2021
NET BOOK VALUE
At 31 March 2021
At 31 March 2020		 Long
leasehold
land and
buildings
£
1,390,933
-
-
(1,390,933)
-
280,933
-
(280,933)
-
-
1,110,000		 Offce and
company
equipment
£
773,348
59,051
-
(761,184)
71,215
764,159
7,965
(761,184)
10,940
60,275
9,189		 Total
£
2,164,281
59,051
-
(2,152,117)
71,215
1,045,092
7.965
(1,042,117)
10,940
60,275
1,119,189

Groundwork UK

Notes forming part of the financial statements

38

10. Investments held as fixed assets


COST
At 1 April 2020
Cash Investments
Disposals
Unrecognised gain on revaluation
At 31 March 2021		 Investment
Property
£
1,100,1000
-
(1,100,1000)
-
-		 Listed
investments
Shares in
subsidiary
undertakings
£
£
874,606
3
490,000
-
-
-
180,946
-
1,545,552
3		 Listed
investments
Shares in
subsidiary
undertakings
£
£
874,606
3
490,000
-
-
-
180,946
-
1,545,552
3
3

Investments are held in a managed mixed fund, which is designed to deliver a return of between 3% and 4% above the Consumer Price Index, over a rolling three-year period.

Nature of
business Country of Class of
NAME registration registration shares held Proportion
Groundwork Trade Association Ltd Dormant England Ordinary 100%
Groundwork Enterprises Ltd Dormant England Ordinary 100%
Groundwork UK Ltd Dormant England Ordinary 100%
Net Retained surplus
assets for the year
2021 2020 2021 2020
£ £ £ £
SUBSIDIARY UNDERTAKING
Groundwork Trade Association Ltd 4000 4,000 - -
Groundwork Enterprises Ltd 25,002 25,002 - -
Groundwork UK Ltd 1 1 - -

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

39

11. Debtors
Grants receivable
Other debtors
Prepayments and accrued income
12. Creditors
Bank loans
Grants due and payable
Social security and other taxes
Other creditors
Accruals
Deferred income (note 14)
13. Creditors: amounts falling due in more than one year
Bank loan
BANK LOAN
1 year
2 to 5 years
> 5 Years
Creditors include amounts not wholly repayable within 5 years as follows:
Bank loans		 2021
£
5,492,705
-
6,157,376
11,650,081
2021
£
-
5,032,035
54,927
35,546
10,841,850
172,627
16,136,985
2021
£
-
-
-
-
-
-		 2020
£
8,767,491
38,772
4,652,946
13,459,209
2020
£
77,737
3,951,815
51,159
179,878
13,896,119
68,472
18,225,180
2020
£
323,821
77,736
233,208
12,877
323,821
12,877

Groundwork UK

Notes forming part of the financial statements

40

14. Deferred income

Balance
at 1 April
2020
£
Movements in deferred income during the year were as follows:
Community Projects
68,472
68,472
Balance
at 1 April
2019
£
Community Projects
24,997
Volunteering Projects
40,135
65,132		 Amount
Release
to Incoming
Resources
£
68,472
68,472
Amount
Release
to Incoming
Resources
£
24,977
40,135
65,132		 Amount
Deferred
in the
Year
£
172,627
172,627
Amount
Deferred
in the
Year
£
68,472
-
68,472		 Balance
at 31 March
2021
£
172,627
172,627
Balance
at 31 March
2020
£
68,472
-
68,472

15. Analysis of net assets at 31 March 2021


Tangible fxed assets
Investments
Net current assets
Analysis of net assets at 31 March 2020
Tangible fxed assets
Investment property
Investments
Net current assets
Long term creditors		 Unrestricted
funds
£
60,275
1,545,555
808,057
2,413,887
Unrestricted
funds
£
1,119,189
1,110,000
3
302,415
(323,821)
2,207,786		 Restricted
funds
£
-
-
3,110,290
3,110,290
Restricted
funds
£
-
-
-
1,211,609
-
1,211,609		 Total
£
60,275
1,545,555
3,918,347
5,524,177
Total
£
1,119,189
1,110,000
3
1,514,024
(323,821)
3,419,395

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

41

16. Statement of funds


UNRESTRICTED FUNDS
At 1 April 2020
Incoming resources
Resources expended
Property revaluation
Transfers
At 31 March 2021
UNRESTRICTED FUNDS
At 1 April 2019
Incoming resources
Resources expended
Property revaluation
Transfers
Loss on investments
At 31 March 2020		 Designated
fund
£
485,370
-
(180,581)
-
50,000
354,789
Designated
fund
£
147,956
-
(167,371)
-
504,785
-
__
485,370_		 Revaluation
reserve
£
410,000
-
-
(410,000)
-
0
Revaluation
reserve
£
327,500
-
82,500
-
-
-
__
410,000_		 General
fund
£
1,312,416
3,612,651
(3,225,969)
410,000
(50,000)
2,059,098
General
fund
£
1,670,608
4,108,897
(3,866,457)
-
(504,785)
(95,847)
__
1,312,416_		 Total
£
2,207,786
3,612,651
(3,406,550)
-
-
2,413,887
Total
£
2,146,064
4,108,897
(4,033,828)
82,500
-
(95,847)
__
2,207,786_

The designated fund represents funds allocated for the ‘Building a Better Groundwork’ project and £50,000 set aside for staff training and development over the next two years.

Balance at
1 April 2020
£
Restricted funds comprise performance related grants as follows:
RESTRICTED FUNDS
Tesco Bags of Help
-
Other programmes
1,185,226
The National Lottery Community Fund
24,137
The National Lottery Heritage Fund
2,246
Total
1,211,609		 Incoming
resources
£
8,470,000
11,250,008
931,205
273,238
**20,924,451 **		 Resources
expended
£
(8,470,000)
(9,362,513)
(930,820)
(262,437)
(19,025,770)		 Balance
at 31 March
2021
£
-
3,072,721
24,522
13,047
3,110,290

Groundwork UK

Notes forming part of the financial statements

42

16. Statement of funds (continued)

16. Statement of funds (continued)

RESTRICTED FUNDS
Tesco Bags of Help
Other programmes
The National Lottery Community Fund
The National Lottery Heritage Fund
Total		 Balance at
1 April 2019
£
-
222,932
118,252
2,882
344,066		 Incoming
resources
£
11,052,079
9,009,346
736,721
264,798
_21,062,944 _		 Resources
expended
£
(11,052,079)
(8,047,052)
(830,836)
(265,434)
(20,195,401)		 Balance
at 31 March
2020
£
-
1,185,226
24,137
2,246
1,211,609

Programme funds are only available for expenditure in accordance with the funders’ directions.

17. Commitments under operating leases

As at 31 March, 2021, the charity had total commitments under a non-cancellable lease for premises as set out below.

Year 1
Year 2
Year 3		 2021
£
26,516
57,204
49,532
133,252		 2020
£
-
-
-
-

18. Pensions

During the year ended 31 March 2021 Groundwork UK paid contributions into a defined contribution scheme. The total charge to the defined contribution scheme amounted to £209,023 (2020: £211,085). There were no contributions either pre-paid or outstanding at the year-end or the previous year end.

19. Related party transactions

At the year-end a balance of £4,000 (2020: £4,000) was owed to Groundwork Trade Association Limited, a wholly owned subsidiary of the company.

Annual Report and Financial Statements 2020/21

Notes forming part of the financial statements

43

20. Reconciliation of net income to net cash fow from operating activities 2021 2020
£ £
Net income for the reporting period
(as per the SOFA) 2,104,783 846,765
ADJUSTED FOR:
Net loss /(gains) on investments (180,946) 95,847
Disposal of fxed asset investments - (82,500)
Depreciation charge 7,965 11,294
Investment income (30,289) (128,324)
(Increase) in debtors 1,809,127 (6,540,861)
Increase in creditors (2,088,195) 5,600,541
Increase in provisions - (65,944)
Net cash provided by operating activities 1,622,445 (263,182)

21. Grants payable

All grants payable relate to institutional grants paid to Groundwork Trusts, delivery partners and community groups. The detailed breakdown of all grant payments is available on request from the charity’s principal address.

Groundwork UK

Notes forming part of the financial statements

44

22. Acknowledgements

Groundwork UK would like to thank all its funders. In particular, substantial major contributions were received from the following organisations.

23. Financial Instruments
Groundwork UK’s fnancial instruments may be analysed as follows:
FINANCIAL ASSETS
Financial assets measured at fair value through proft and loss:
Investment property
Investments
Avison Young
Cadent Foundation
CAST
City & Guilds
Comic Relief Community Fund (England)
Coop Foundation
DIAGEO
Education & Skills Funding Agency
Energy Saving Trust
Greater London Authority
HS2 Limited
Jones Lang Lasalle Limited
Locality
Ministry for Housing, Communities and Local Government
NHS Property Services
One Stop Stores
Royal Society of Wildlife Trusts
Tesco PLC
The National Lottery Community Fund
The National Lottery Heritage Fund
Veolia		 2021
£
-
1,545,552
1,545,552		 2020
£
1,110,000
874,606
£
£13,385
£750,612
£17,162
£10,000
£1,213,755
£34,995
£110,000
£1,383,250
£172,233
£3,292,776
£2,500,177
£5,438
£960,736
£2,672,859
£143,774
£240,319
£103,782
£8,094,208
£931,205
£817,412
£20,000
1,984,606

Financial assets measured at fair value through profit or loss comprise fixed asset investments in a trading portfolio of listed company shares.

Annual Report and Financial Statements 2020/21

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Notes forming part of the financial statements 45
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Groundwork UK

46 Advisers

Advisers

Auditors

Crowe U.K. LLP

Black Country House Rounds Green Road Oldbury B69 2DG

Investment Managers

Rathbone Investment Management 8 Finsbury Circus London EC2M 7AZ

Property Consultants

Bankers

Savills

The Co-operative Bank plc

PO Box 82 118-120 Colmore Row Birmingham West Midlands B3 3BA

HSBC

114 High Street Stourbridge West Midlands DY8 1DZ

55 Colmore Row Birmingham B3 2AA

Solicitors

Anthony Collins Solicitors LLP 134 Edmund Street Birmingham B3 2ES

Scottish Widows Bank plc

PO Box 12757 67 Morrison Street Edinburgh EH3 8YJ

Annual Report and Financial Statements 2020/21

The Board of Trustees

47

The Board of Trustees

The trustees (who are the directors of the company in accordance with the Companies Act 2006) on the date of approval of this report, or who served as trustees at any time during the year reported on, are as follows.

Appointed trustees

First appointed

Last appointed

Tony Berry October 2019 AGM 2020 John Bland March 2018 AGM 2018 Stuart Bonham December 2019 AGM 2020 Ian Brown March 2016 AGM 2019 Wendy Golland September 2014 AGM 2020 Jeff Greenidge March 2019 AGM 2019 Rowena Hall March 2019 AGM 2019 Mike Master September 2008 AGM 2020 Antony Nelson March 2019 AGM 2019 Nigel Reader July 2021 Neville Reyner September 2019 Paul Roots March 2019 AGM 2019 Anne-Marie Simpson December 2019 AGM 2020 Alan Smith June 2014 AGM 2020 Andrew Thurston January 2021 Helen Wright March 2019 AGM 2019

Retired/resigned

Resigned December 2020 Resigned September 2020

Resigned January 2021 Resigned September 2021

Resigned August 2020

Resigned March 2021

Co-opted trustees

Faiza Amin September 2019 AGM 2019 Kate Culverhouse December 2013 AGM 2020 Graham Hartley (Chair) August 2015 AGM 2018 Geoff Howsego June 2012 AGM 2018 Mike Ormerod June 2018 AGM 2018 Jack White September 2019 AGM 2019

Resigned September 2021

Company Secretary

Paul Viles

Committees of the Board

Chairs' Committee Chair – Graham Hartley Federation Executive Team Chair – Mike Ormerod Groundwork UK Committee Chair - Geoff Howsego Audit Committee Chair – Stuart Bonham

Chief Executive

Graham Duxbury

Groundwork UK

Contact us

Suite B2, The Walker Building 58 Oxford Street, Birmingham B5 5NR

www.groundwork.org.uk

Tel: 0121 236 8565 Email: info@groundwork.org.uk

Twitter: @groundworkuk Facebook: @groundworkuk Instagram: @groundwork_uk LinkedIn: Groundwork

Charity registration number: 291558

Company registration number: 1900511

Groundwork UK is the operating name of the Federation of Groundwork Trusts, a company limited by guarantee.