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2020-07-31-accounts

CANFORD SCHOOL LIMITED (Limited by Guarantee)

REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2020

Registered Company No: 00190956 Registered Charity No: 306315

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

CONTENTS

DIRECTORS AND OFFICERS .................................................................................................................................................................................................................................................. 2 NOTICE OF ANNUAL GENERAL MEETING .............................................................................................................................................................................................................. 4 DIRECTORS AND TRUSTEES’ REPORT ......................................................................................................................................................................................................................... 5 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF CANFORD SCHOOL LIMITED .................................................................................. 155 CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES ................................................................................................................................................................. 177 CONSOLIDATED AND CHARITY BALANCE SHEETS ................................................................................................................................................................................... 19 CONSOLIDATED CASH FLOW STATEMENT ................................................................................................................................................................................................... 190 NOTES TO THE FINANCIAL STATEMENTS ........................................................................................................................................................................................................ 201

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CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

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DIRECTORS AND OFFICERS

DIRECTORS

Chairman David Levin BEcon MA FRSA Vice-chairman Michael Jeffries Dip Arch RIBA FICE FRSA Annette Anthony JD Mary Armitage CBE BSc MB ChB DM FRCP FRCPE Teresa Colaianni Barry Coupe BA DipArch RIBA Lieutentant General Sir Gary Coward KBE CB Robert Daubeney BA Philippa Dickins MA MBBS DCH DRCOG MRCGP Georgina Fozard MA Cantab MBBS MRCPsych Professor Mark French MA Oxon PhD Nicholas Holloway BA Stephen Le Bas FCA BA Hons Richard Nicholl BA PGCE Adam Richards BA Rev John Simmons James Stileman MA Annabel Thomas BA

Resigned 28 January 2020

OFFICERS

Headmaster Ben Vessey MA MBA

Bursar David J Brook OBE BSc MA CEng MRAeS Company Secretary Michael Porter MSc BA

Registered Office The Bursary Canford School Wimborne BH21 3AD

Solicitors Harrison Clark Rickerbys Limited Ellenborough House, Wellington Street Cheltenham GL50 1YD

Steele Raymond LLP Richmond Point, 43 Richmond Hill Bournemouth BH2 6LR

Veale Wasbrough Vizards LLP Narrow Quay House, Narrow Quay Bristol BS1 4QA Auditors Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG

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Bankers Barclays Bank Plc Wytham Court 11 West Way, Botley Oxford OX2 0XP Insurance Brokers Marsh Limited Capital House 15 Perrymount Road Haywards Heath RH16 3SY Investment Advisors Rathbone Brothers Plc 8 Finsbury Circus London EC2M 7AZ

Ruffer LLP 80 Victoria Street, London SW1E 5JL

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NOTICE OF ANNUAL GENERAL MEETING

The Annual General Meeting of the company will be held at 12 noon on Thursday 25 March 2021 at Canford School, Wimborne BH21 3AD.

In accordance with the Articles of Association Mr Jeffries, Mr Holloway, Mr Le Bas, Rev Simmons and Ms Thomas retire by rotation and, being eligible, offer themselves for re-election. For a third of the governors to be re-elected, required by the Articles of Association, Mr Daubeney, as the longest serving governor, retires by rotation and being eligible, offers himself for re-election.

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REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

DIRECTORS AND TRUSTEES’ REPORT

FINANCIAL STATEMENTS

The directors present their annual report and audited financial statements for the year ended 31 July 2020. The directors have adopted the provisions of the Charities Statement of Recommended Practice (SORP) (Second Edition, effective 1 January 2019) based on Financial Reporting Standard (FRS) 102, in preparing the annual report and financial statements of the charity.

OBJECTS AND AIMS

Charitable Objects

The Charity’s Object is to advance the education of boys and girls including but not limited to the provision of a senior school in or near Canford, Dorset and/or if thought desirable, in other parts of England or Wales, in accordance with the principles of the Church of England.

Public Benefit Aims and Intended Impact

In furtherance of this Object, Canford School’s public benefit aim is to provide a first class independent education, through strong academic tuition and through developing wider sporting, artistic, cultural and social skills in all its pupils. This is intended to provide an environment where each pupil can develop and fulfil his or her potential, thus to help build self-confidence and inculcate a desire to contribute to the wider community.

Canford has restricted and unrestricted funds for the development of the School’s facilities as well as for scholarships, prizes and other educational purposes. The School provides bursaries for those without the means to support their child through school.

The Charity also has to maintain its heritage endowment, with its Grade I and II listed buildings and historic park and tree collection, which are all considered of national importance.

Canford views the social responsibilities it carries as an educational institution as being a central feature of our ethos, aims and actions. The ‘Importance of Community’ is one of our core aims whereby we recognise ‘the importance of community and the engendering of a deep rooted sense of social responsibility in the context of Canford’s Christian origins and heritage’ alongside ‘respecting the abilities, views and dignity of others throughout the school community and in the wider world’.

This is not just a form of words but articulates an attitude and approach which guides and informs much of what we do within and beyond the school. Aside from activities within the school based educational programme which seek to raise awareness and understanding of issues and problems confronting the wider world, hundreds of our pupils and many of our staff are engaged in active charitable and community partnership work locally, regionally, nationally and internationally. It is beyond the scope of this report to outline all of the detail of this extensive activity, although some more information can be found on pages 7 and 8. This social engagement and interaction in a meaningful and sustained sense is very much part of the fabric of Canford’s culture.

In the furtherance of these aims the Governors, as the charity trustees, have complied with the duty in s.17 of the Charities Act 2011 to have due regard to the Charity Commission’s published general and relevant sub-sector guidance concerning the operation of the Public Benefit requirement under that Act. In addition, the Trustees act to promote the success of the school by: considering the likely consequences of any decision in the long term; looking at the interests of the company’s employees; fostering relationships with pupils, parents, staff, suppliers and others; considering the impact of the Charity’s operations on the community and the environment; by maintaining a reputation for high standards of business conduct; and acting fairly as between members of the company.

STRUCTURE, GOVERNANCE AND MANAGEMENT

The School is a company limited by guarantee and each of its members has undertaken to contribute an amount not exceeding £1 (one pound) towards the assets of the company in the event of the same being wound up and the assets being insufficient to cover the company’s debts and liabilities. The School is a registered charity and is governed by its Articles of Association as most recently amended on 26th September 2013 by Special Resolution. Canford School is a member of the Allied Schools group of independent schools, all of which were founded by the Martyrs’ Memorial and Church of England Trust (MMT). On September 26th 2013 the Allied Schools signed a management Agreement with MMT by which the members of the group agreed to the appointment of the Allied Schools Agency to oversee the performance of the schools and to monitor their adherence to the foundational religious principles on behalf of MMT.

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The School has a subsidiary company, Cheneford Limited, which undertakes a range of trading activities including the letting of the School’s sports facilities to the public. We also co-operate with many local charities in our on-going endeavours to widen public access to the schooling we provide, to optimise the educational use of our cultural and sporting facilities and to awaken in our pupils, in the public interest, an awareness of the social context of the all-round education they receive at Canford.

Governing Body

The Governors, who are also the directors and charity trustees, are responsible for the overall management and control of Canford School and meet three times a year. The work of detailed formulation and implementation of most of their policies is carried out by members of the Finance and Executive Committees, who usually meet a few weeks in advance of the full Governing Board. The Education and Safeguarding, Property, External Relations and Communication, and Awards sub-Committees perform detailed reviews in their specialist areas.

Governors are elected by the Governing Body, except that two trustees are nominated by the Martyrs Memorial and Church of England Trust if the total does not exceed 12, three if the number exceeds 12 but does not exceed 18, and four if the number exceeds 18. New governors are appointed by existing governors with input from the Headmaster and Bursar and care is taken to ensure that the relevant skills and experience are represented. Each new governor is provided with an information pack (handbook) and meets with key staff as part of an induction process. They are all encouraged to spend time at the School to experience lessons as the pupils do. All governors receive information on governor training update courses.

All governors have access to the meeting papers and minutes for all committee meetings, whether or not they are members of that committee. This ensures that they are informed about the issues being addressed by those committees but can also raise queries and monitor progress in a wide range of areas. The chairmen of the sub committees meet regularly with the School’s lead for each committee area, thereby ensuring that they are fully briefed on issues and can provide advice, challenge and support as required.

Organisational Management

The day to day running of the School is delegated to the Headmaster, the Bursar and the Senior Leadership Team (SLT), which comprises of Deputy Head Academic, Deputy Head Pastoral, Deputy Head Co-Curricular and two Assistant Heads (Academic and Pupils). Strategic matters are discussed with the Senior Management Group (SMG), which comprises of the SLT plus the directors of Marketing, Admissions, Development, Human Resources, Finance and Estates, as well as the School Services Manager. Various educational management groups also operate to progress educational and pastoral matters.

Changes to the remuneration levels of key management personnel are made with reference to industry standards, such as the Baines Cutler benchmark reports. Remuneration changes for specific roles are made with reference to internal performance criteria and external role benchmarks, including salary surveys and use of a benchmarking agency as required.

The Headmaster and Bursar attend meetings of all the governors’ committees.

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STRATEGIC REPORT AND FUTURE PLANS

Canford’s Governors recognise that the School must remain competitive, relevant and sustainable in a rapidly changing and increasingly uncertain environment in which there is no shortage of local and regional competitor schools. In looking to the future, Canford intends to maintain and enhance its profile and position as a premium independent school. The Governing Body is already implementing strategies that will enable the School to defend and grow its share of the prestige school boarding and day markets. The key to this will be attracting and retaining suitably able pupils by meeting or exceeding their and their parents’ expectations for high academic results, a wide range of high-quality co-curricular facilities and for comfortable pupil accommodation. Our plans include a wide array of educational programmes to enhance the learning experience of our pupils and the provision of flexible, adaptable infrastructure in order to widen the gap between full capacity and the break-even point, allowing flexible and efficient operation with an appropriate level of spare capacity. This strategy is subject to regular reviews, particularly in light of the Covid-19 pandemic.

Vision and Mission Statements

Achievements and Performance

Our vision and values have played out each and every day over the past year in so many ways, not least in the way all have adapted and supported each other over the past months during the challenges of the Covid-19 pandemic.

During the Summer Term, our remote education programme saw the delivery of over 12,000 remote lessons and a wide range of activities and pastoral meetings. The quality of our remote educational provision was ‘mentioned in dispatches’ in a letter from a leading educationalist to the Education Select Committee at the end of June which stated ‘I have been involved, for various reasons, in phoning headteachers both of state and independent schools, and the difference in ‘offer’ during this period can be enormous. Canford independent school is the best I have come across and if you want an example of what can be provided, I suggest you look at Canford.’ It has been very much a team and a community effort and the achievements of all are shared by everyone.

Academic and Enrichment

Our leaving Upper Sixth had always set the bar high and their future ambitions were no exception. Most are heading on to Higher Education. Of 160 UCAS applications submitted 578 offers have been received with 13 to Oxbridge, 433 to Russell Group universities and 63 to Sunday Times Top Twelve institutions such as Bath and St Andrews. However, increasingly our leavers are exploring a wider range of post school options, including a number of impressive dreams in the creative and performing arts and in the world of work.

Our significant enrichment programme is designed to change ways of thinking and engaging with a wide range of issues and perspectives. This year’s Festival of Ideas saw 22 speakers over three days. The whole 6[th] Form was taken off timetable for the festival to engage fully with the theme of “Identity and Diversity” – part of an ongoing focus on key issues of inequality, ignorance and intolerance which face our society and the need to bring about changes in thought, culture and action. The need for such a focus has been brought into even sharper focus with the death of George Floyd and the advent of the Black Lives Matter movement, and we have a range of other initiatives in the planning stage to ensure that Canfordians head into the wider world with a clearer and stronger knowledge and sense of understanding of society and what has shaped it.

Festival Speaker highlights included Carol Murraine form Eastside Young Leaders talking about educational inequality and opportunity for young black children; Peter Tatchell on his career campaigning for Gay rights; Fiona Hathorn discussing women on boards; Alison

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Branitsky discussing living with mental illness and Paul Whittaker, a musician who lost his hearing at birth, who had the entire 5[th] Form signing SClub7 within an hour on a dark Thursday night as part of his efforts to create an appreciation of how loss of key senses opens up other opportunities. Other enrichment activities saw over 20 Lower Sixth pupil-led “Ted Talks” delivered to fourth form scholars on a wide range of topics; 24 separate Tower Society discussion lunches; and hundreds of pupils involved in debating and numerous department book clubs.

All 147 Lower Sixth submitted an entry into the Baynham & C P Snow essay competitions. 13 were shortlisted to either win or receive special commendation. Entries were submitted to 23 separate external academic competitions with two first place winners. We have also seen the establishment of a modern languages’ academic magazine “Hispanista” and a university interview exchange programme with local schools and the City of London Academy

As part of our remote programme provision for the Upper Sixth who suddenly found themselves with a significant gap in their focus following the cancellation of public exams, a superb College Programme was put in place. It included 25 external speakers focused on a range of issues and experiences including Peter Singer, Laura Bates, A C Grayling, Michael Tomlinson, Deanna Rodger, Marie-Christine Nibagwire and James Landale. Many of these talks were open to and attended by pupils in other year groups. There were 90 separate electives developing insight into and engagement with a stunning range of topics and over 200 separate Academic seminars.

Sport

The Christmas term saw Canford field 39 teams across 11 sports with 626 pupils representing the school in some form of competitive sport. The Easter term saw a similar number of teams across many different sports with similar participation levels. Over 20 different sports were offered over the two terms. The 1[st] XV rugby squad achieved 10[th] in the national rankings playing in a style and with an attitude which was very impressive. The U16 and 1[st] netball squads who showed incredible grit, talent and wonderful team spirit over the season and both teams secured 4[th] place nationally at the National Finals on the last sporting weekend before lockdown. The Summer term was fallow for obvious reasons but there was plenty of online physical activity, competition and focus using a range of innovative and creative concepts with inspiring messages from top sports stars such as Jonny Wilkinson and Kevin Peterson. There were many individual and team highlights at all levels across range of sports with significant county/ regional/ national representation but also commitment and courage across the lower teams representing school.

Drama

The Drama department staged 12 different events over the first two terms ranging from small scale pieces such as ‘If You Want Something Done’, devised and performed by pupils, to Chicago with 45 cast members and 17 crew. Cinderella; a Canford Pantomime, written by a shell pupil saw 13 students and 2 staff in the cast with 7 crew. The House Drama competition included 9 performances involving approximately over 130 pupils. The final production, Frankenstein with 17 cast and 6 crew was magnificent and was the final activity we saw in the theatre before lock down. Over 250 pupils have been involved in drama productions in some capacity, not counting those that made up the audience. During remote schooling we saw two small groups of pupils write, record and edit their own series of radio plays; 28 monologue presentations were recorded; pupils have had the opportunity to submit their own films; and 15 pupils have been engaged in script writing and/or set design programmes. The ‘show must go on’ mind set has been ever present despite the problems faced.

Music

28 live concerts were held this year. Alongside the many music lessons and much hard work which saw excellent outcomes on ABRSM exams there were four professional workshops including our annual link with The Britten Sinfonia. Once again, those Canford Values shone through during ‘lockdown’ as we were enthralled by 22 remote ensemble performances recorded remotely and assembled, some released ‘standalone’ which involved pupils from all years and staff. There were 6 ‘live’, virtual concerts, and one pre-recorded informal concert to allow those in the Far East to take part. We also had 6 YouTube concert releases of previously recorded events, including 2 previously unheard concerts of the GCSE and A level compositions from this year. Over120 pupils have performed music formally as part of an ensemble at some point during the year.

Outward Bound, CCF, Duke of Edinburgh and Trips

This year the Outward Bound programme has offered many opportunities for Canfordians to develop their character and skills. In D of E we currently have 29 working towards Bronze and 59 working on their Gold Award.

In the CCF programme, this was the first year we entered The Rifles Cup, a national cadet CCF and ACF competition, run in Surrey in

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September 2019. In our first attempt at this competition, Canford returned victorious beating a large number of CCF and ACF units. The CCF Annual Inspection was one of final events before lockdown – and it was an incredible testament to the programme and crucial skills developed by those hundreds of Canfordians who take part in CCF. Canfordians are not confined to base - across all aspects of educational life we ran 135 trips including 10 overseas in first two terms.

Community Service and Public Benefit

Community partnership engagement is a crucial part of Canford’s programme to develop greater social awareness and responsibility. The Independent Schools Council have a website called ‘Schools Together’ (https://www.schoolstogether.org/) which catalogues the independent-state school partnerships run termly by around 1200 ISC schools. Canford has 64 case studies included and 20 state school partnerships.

Community Service has involved 33 separate community placements involving over 300 pupils with a focus on ongoing partnership links such as the Northam City Reach, SHINE projects and support for state schools. The relationship with the Bourne Academy continues to thrive. Five Canford staff and four Canford parents serve as governors on The Bourne Academy Governing Body and there are regular reports on its work to the Canford Governing Body so that joint initiatives can be discussed and explored. During the year The Bourne Academy achieved a ‘Good’ rating under the new rigorous OFSTED regime. Canford Sixth Formers spent over 800 hours with pupils at The Bourne Academy working together on a variety of projects. Bourne Academy pupils attend future careers fairs and speaker events at Canford School and this year we will also be inviting pupils to attend the Annual Festival of Ideas. All Bourne Academy Teach First staff spend a week at Canford with the appropriate department and anyone doing a PGCE at Canford can do their teaching practice at The Bourne Academy.

The Shine scheme involving ‘gifted and talented’ pupils from three local primary schools, which feed into The Bourne Academy, continues. The City Reach scheme is thriving and 16 pupils and staff walked 16 miles in the Easter term to raise funds for the project. City Reach also visited at Christmas for lunch and a swim. Unfortunately, a planned trip to the Isle of Wight had to be cancelled due to the pandemic.

A full range of community projects ran prior to the pandemic lock down, including 100 hours spent performing musical concerts in a number of care homes; 49 pupils helped in local primary schools; 150 hours spent visiting patients in a local hospice; nine pupils taught local school children to swim in Canford’s pool; and over 200 hours were spent helping in local charity shops. In total, nearly 9,000 volunteer hours were given by Canford Sixth Formers supporting local community projects.

During the lock down period, pupils made a number of videos showing, for example, craft activities and sports skills that were sent to local primary schools to use with their pupils. Other pupils wrote postcards to elderly members of our local community amongst. Staff delivered food parcels and cakes baked by Canford chefs to elderly local residents and care homes; donated food to the local food bank and assisted NHS field hospitals with laundry provision. Several staff and pupils telephoned isolated local residents.

Following the tragic death of a Sixth Form pupil in December 2015, a charitable trust was established to support various local needs and pupils continued to raise funds through a series of events.

Unfortunately, our Canford Partnership trips to India, Ghana and Argentina, plus a new trip to Cambodia, had to be cancelled this year.

Stakeholder Relationships

Canford exists as a community; our links with current and former pupils, parents and staff, as well as our community partners, are strong. Similarly, our relationships with suppliers are crucial to our success.

Over the last year, the School have used more than 50 suppliers, supporting our local, regional and national economy. We have improved our payment performance, in regards to paying within the agreed terms, and continue to focus on this. In particular, during the lock down period due to Covid-19, we ensured suppliers continued to be paid on time and provided flexibility when appropriate. We are grateful to our suppliers for their continued support for Canford.

Fundraising Performance

Canford undertakes fundraising activity to its supporters via fundraising events, sponsored events and direct mail. Email is used in line with the Fundraising Code of Practice set by the Fundraising Regulator. Our fundraising promise, which is available on our website alongside our privacy notice to reassure supporters of our approach, is:

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Canford is registered with the Fundraising Regulator and adheres to the standards of the Fundraising Code of Practice. There were no complaints about fundraising activity during the year.

Total fundraising costs during the year including operating budget and salaries were £174K (2019: £217K). Event income (tickets purchased) partially offset some of the costs. Income from fundraising activities totalled £100K (2019: £687K). The Development Programme continues to seek to engage alumni, parents and friends of Canford as School benefactors. This can be through giving of time and expertise through volunteering; the giving of financial donations including one-off gifts, regular giving, or gifts of stocks, shares or art; and securing longer-term legacies.

There are three main areas of activity within the current Development Programme: (1) engaging the Canford Community, (2) encouraging and promoting volunteering, and (3) fundraising to increase access to a Canford education through the provision of pupil bursaries. Secondary fundraising priorities include funding capital and equipment projects.

Engaging the Canford Community involves supporting the many different volunteer-driven groups which themselves aim to benefit Canford, Canfordians and associated partner charities and organisations. The Development team provide support to the Old Canfordian Society (OCS), the Friends of Canford School, the Friends of Canford Music and the Friends of Canford Rowing. Events and monies raised by these groups are returned directly to benefit the education and enrichment of pupils and the Canford Community. Modernisation of the OCS is continuing, and developments will transform connections between OCs and facilitate better communication, knowledge and support of our alumni.

Volunteers to Canford give in a variety of ways. All school governors are volunteers and provide strategic oversight. Many others serve as alumni, sports or committee representatives. Alumni and parents provide careers advice to pupils providing mentoring, work experience or coming in to Canford to speak to pupils about their experiences. Other volunteer duties include supporting music at Canford, supporting sport at home and away fixtures and speaking at Canford events. During the year over 250 individuals provided their time and expertise free of charge to Canford. The Governing Body is very appreciative of this invaluable support.

Donations include cash gifts, regular gifts, bequests received and gifts-in-kind. The Development Office also supports the work of the Friends of Canford School (FCS), a parent and friends’ group. This group continues to support educational enrichment at Canford, through the provision of grants to departments and clubs within the school. They also support external charities with whom Canford has an existing partnership, most notably the City Reach project in Southampton.

The fundraising board meets regularly. The third annual fundraising auction to support the Martin Marriott Foundation raised a significant amount for the Foundation in November 2019. Regular donors acquired through the 2019 Telethon are established and stewarded accordingly. The Case for Support on the website has been updated to include new testimonies from bursary pupils, state fundraising aims and provide an accessible method for making online donations. Our fundraising focus has changed in light of Covid-19 and engagement has been of primary importance. The new strategic plan for 2019-2024 is complete with an action plan re-drafted following Covid-19.

Employee Engagement and Employment Policy

Governors communicate with employees through a variety of channels. Both governors and employees sit on the Joint Consultative Committee where matters relating to pay, benefits and working conditions are discussed. Governors and employees also sit on the Health and Safety Committee. Governors write to employees to explain the impact of significant decisions, such as pay reviews and the strategic direction of the School. Any significant decisions taken during governors’ meetings are assessed for the impact they will have on staff, with the governors aware that the School cannot be successful without an engaged, motivated staff body. In particular, the governors provided employees with a number of specific reassurances during the Covid-19 lockdown which were unanimously appreciated by staff.

For information on the relationship between governors and management, see section ‘Structure, Governance and Management’.

Canford School is an equal opportunities employer. Full and fair consideration is given to job applications from disabled persons and due consideration is given to their training and employment needs. Consultation with employees, or their representatives, has continued at all levels with the aim of taking the views of employees into account when decisions are made that are likely to affect their interests. Employees are made aware of the financial performance of the school.

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FINANCIAL REVIEW AND RESULTS FOR THE YEAR

Current pupil numbers, and considerable future interest in the School, give us confidence that we will be at full capacity for the foreseeable future. This is a result of our continued resolve to deliver a top quality education, supported by talented staff in an inspiring environment – features that are now synonymous with Canford School.

The School’s financial policy is to maintain total fee income at a level sufficient to generate a surplus over time to meet the objectives of the School’s strategic plan, allowing for investment in the school. This will be achieved through a mixture of operating cash flow and fund raising. As a charity the parents of our pupils have the assurance that all the income of the school must be applied for educational purposes.

In preparing its budget for this year the School recognised the need to continue to invest in high quality staff and to invest in the School’s fabric to ensure that both continue to support the educational mission.

Financial review summary 2020 2019
School fees receivable £17,421K £19,804K
Fundraising income £100K £687K
All other income £2,324K £1,966K
Provision of education £(19,015)K £(19,138)K
Other costs £790K £(842)K
Net income £40K £2,478K

Operational financial performance improved this year during the first two terms, principally due to high pupil numbers and careful management of costs. However, the Covid-19 pandemic necessitated a move to remote teaching and a reduction in fees charged, reducing school fee income considerably. Whilst income from the Government’s Coronavirus Job Retention Scheme (CJRS) mitigated the impact, the continuation of high-quality remote education meant that the majority of costs, being teaching staff, could not be covered under the CJRS. The amount raised through fundraising was lower, due to a bequest in the prior year, and investments saw losses. The operating surplus (general funds) as a percentage of net fee income was 0.7% (2019: 11.3%).

Total gross fee income for the year was 9.7% lower than last year (2019: 6.1%). The Statement of Financial Activities shows the School’s Loss Before Transfer of Funds to be £0.5M (2019: surplus of £2.5M). The principal reasons for this reduction, compared to the prior year, are the reduction in school fees receivable (£2.4M) due to Covid-19 fee reductions; the lack of any significant fundraising income (£0.6M); partially offset by increased receipts from the CJRS (£0.8M). Careful cost control was exercised throughout the year, particularly during remote education, on charitable activity expenditure to ensure that resources were focussed on pupil outcomes.

The overall cost of the School’s capital expenditure in this financial year amounted to £4.1M (2019: £1.8M), which included the strategic capital works programme (infrastructure upgrades £1.1M, new Library £0.6M, new Boarding House £0.8M and new Outdoor Education Centre £0.9M). Other capital expenditure included continued reinvestment into the fabric of the school. Investing in additional flexible capacity and improved core facilities will ensure Canford’s future sustainability and there is a clear imperative to complete the strategic building plans which are essential to support future sustainability and success. The economic environment and effects of Covid-19 will demand caution, therefore, whilst planning work for subsequent phases of the capital programme will continue, the decision for any construction to begin will be preceded by a wholesale review of demand and requirements. All projects will remain subject to the usual governance and approval processes. Given the investment in capital expenditure there was a reduction in cash of £1.4M (2019: £2.1M).

Overall the Trustees accepted this financial result, given the economic circumstances of the past year, and are reviewing the level of surplus required to meet the objective of providing sufficient income for the School’s strategic plan` objectives.

Reserves Policy

The beneficiaries of Canford School are its pupils; any reserves held must ultimately be for their benefit. Governors have determined that Canford should not hold excessive reserves, money that could otherwise be used for the benefit of pupils. Equally, insufficient reserves, in the event of a crisis, may mean that pupils experience undue disruption to their education.

Given the current economic climate, political climate and the Covid-19 pandemic, or in the event of a crisis, trustees have reaffirmed their commitment for pupils to be able to complete the current academic year as a minimum. This strikes a balance between unduly tying up funds and minimising disruption in a crisis such as unplanned closure. To ensure this, the level of general reserves held will be equivalent to the sum of cash liabilities in the longest period in the academic year with no fee income, approximately £6M. This has been tested

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against a number of scenarios to confirm the suitability of this level of reserves.

Whilst restricted funds fall outside the definition of free reserves, some restricted funds are maintained principally for the award of bursaries and the advance payment of school fees. Designated funds are also held, in addition to the reserves above, for the purposes of matching the investment made in the fabric of the school, to fund the school’s partnership activities and to provide bursaries.

At the year end the school held total funds of £44.1M, of which £2.9M was held in restricted funds principally for the award of bursaries and the advance payment of school fees. The trustees have designated a further £31.0M for the following purposes:

a) to match the investment it has made over the years in the fabric of the school estate and is not therefore freely available £25.1M

b) to set aside funds to support the school’s partnership activities £0.2M; and

c) to set aside funds that are invested for the provision of bursary support £5.7M.

After these designations, and the value of fixed assets not represented by the property fund, the free reserves of the school are £10.2M (2019: £11.3M) which the trustees consider exceed the reserves policy objective. This excess will be used to fund capital projects for the charity’s beneficiaries, with at least £8m capital expenditure planned in 20/21 (on projects started prior to the Covid-19 lock down). Trustees monitor reserve levels on a regular basis, considering the working capital management of the school and the desire to continually improve its facilities.

Investment Policy and Objectives

Canford School holds investments in three portfolios with the prime objective to preserve and grow the capital value of funds, whilst generating sufficient income to meet the current commitments of the School. This is achieved through a balanced approach to income and asset growth and appropriate risk diversification. The policy recognises that there will be differing investment styles required for some of the restricted funds.

The school uses external professional discretionary fund managers to achieve the investment objectives, which may be a single firm or several firms. The performance of these managers is reviewed regularly by the Investment Sub-committee of the Finance Committee as is the overall allocation of assets by type and manager. During the year, following a tender process, Rathbone Brothers PLC were appointed to manage the investment portfolio from February 2020, with all funds transferred from Ruffer LLP. Rathbone Brothers have discretionary management powers. In 2020 a loss of 3.8% (2019: 1.1% gain) was seen across the funds. Post-year end, the first three months of the year have seen a gain of 2.9%

The largest portfolio is a fund for the award of scholarships and bursaries. This fund comprises the Assyrian Fund and Canford Partnership Fund. The investment policy is to maximise long-term total return in such a way as to permit the regular award of scholarships and bursaries while maintaining or increasing the value of the fund in real terms. The second portfolio comprises various funds restricted by the donors for the provision of scholarships, bursaries and prizes. The Composition Fees Scheme for advance payment of fees, the third portfolio, were invested with the aim of preserving the capital and achieving a return over a period of five years sufficient to fund the School’s liabilities under the scheme.

The company’s Articles of Association empower it to invest the monies of the company not immediately required, as it thinks fit.

Grant Making Policy

This year, the value of scholarships, grants, prizes and other awards made to the School’s pupils was £768K (2019: £845K). The Governors’ policy is to make these awards based on the individual’s educational potential, subject to the particular conditions imposed by the original donor where an award is made from restricted funds. In addition, means-tested bursary awards totalling £1,172K (2019: £958K) were provided. £157K (2019: £384K) of the bursaries awarded were funded from investments – the remainder being funded from fees income. The policy for awarding bursaries is to broaden access to the school for prospective pupils and to relieve hardship where a current pupil’s education and future prospects would otherwise be at risk. Awards representing 90% or more of the fees went to 23 pupils (2019: 16). The availability of all such awards for fee assistance, together with the terms and conditions for each kind of award, is advertised on our website. In the year the Governors reaffirmed their plan to increase the funding available for means tested fee assistance through fundraising.

Energy and Carbon Performance

For the first time, we are reporting the School’s energy and carbon use. This is an area which receives an ever-increasing focus in the School. During the year, several actions were taken to reduce the School’s environmental impact. In November 2019, a new contract for renewable electricity was put in place, meaning the vast majority of the school’s electricity is from renewable sources. Based on the

12

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

latest Energy Savings Opportunity Scheme (ESOS) report, a number of buildings were converted to LED lighting in order to reduce energy consumption. A pupil-led campaign resulted in reductions in plastic waste, using non-disposable water bottles, and food waste, through improved reporting that highlighted the issue. These efforts resulted in the school being awarded Silver status under the EcoSchools programme.

For all Canford’s major capital projects, early consideration is given to heat generation options for the building, including the investigation of low and zero carbon technologies. Each option is evaluated on its likely reduction of carbon emissions, along with the practicalities of the location, likely impact on the setting and surrounding grounds, along with technical and cost considerations.

The new Boarding House will have a building management system to optimise hot water heating efficiencies and ventilation will either be natural or use high efficiency plate heat exchangers, where required. All lighting will be based on low energy LED technology, with daylight and motion sensors. The new Library will use a similar LED lighting system and is designed to have a high air tightness rating along with a high efficiency heating system.

It has not been possible to determine CO2 emissions from activities; neither has it been possible to gather data on the full range of the School’s energy consumption. However, the details below provide a benchmark for future years in order to improve both the reporting and performance of the Schools’ energy and carbon use, including the use of an intensity ratio

Consumption Notes
Electricity 1,730,850 kWh All School buildings and houses where the school is
responsible for electricitycosts
Gas 5,478,691 kWh All School buildings and houses where the school is
responsible forgas costs
Transport fuel 18,250 litres Diesel fuel for minibuses and car; future reports to include
other vehicle usage

Risk Management

The Board of Governors is responsible for the management of the risks faced by the School. Risks are identified and reviewed by the School’s leadership team and separated into functional risk areas. The Governors’ functional sub-committees then review their risk areas on a termly basis, implementing measures as appropriate to mitigate their effect. The most significant risks are reviewed by the Governing Body each term. Through the different elements of this process the Governors are satisfied that the major risks to the School have been identified and have been reasonably mitigated with key controls.

The Governors consider the major risks to the School to be:

The key controls include:

13

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

The Directors are responsible for preparing the Directors and Trustees’ Report, incorporating the strategic report, and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the charitable company and group for that period. In preparing these financial statements, the Directors are required to:

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

So far as each of the Directors is aware at the time the report is approved:

AUDITORS

Haysmacintyre LLP have expressed their willingness to continue as auditors to Canford School Limited.

This report was approved by the Board on 27 November 2020 and signed on its behalf by:

David R Levin Director/Trustee

14

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF CANFORD SCHOOL LIMITED

Opinion

We have audited the financial statements of Canford School Limited for the year ended 31 July 2020 which comprise the Consolidated Statement of Financial Activities, the Consolidated and Charity Balance Sheets, the Consolidated Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group 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.

Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement set out on page 14, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditor’s responsibilities for the audit of the financial statements

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.

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.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Directors and Trustees’ Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

15

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

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 group and the parent charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors and Trustees’ Report (which incorporates the strategic 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:

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.

Steven Harper (Senior Statutory Auditor) 10 Queen Street Place For and on behalf of Haysmacintyre LLP, Statutory Auditors London EC4R 1AG Date: 18 February 2021

16

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES

(Incorporating an Income and Expenditure account)

INCOME FROM
Income from charitable activities
School fees receivable
Other educational income
Other ancillary trading income
Other trading activities
Fundraising
Trading company
Rents and school lets
Income from Investments
Other income
Total Income
EXPENDITURE ON
Expenditure on raising funds
Expenditure on Charitable activities
Total Expenditure
NET INCOME before
transfers and investments
gains/(losses)
OPERATING SURPLUS before
investment gains/(losses)
Net gains/(losses) on Investments
FUNDRAISING INCOME
SURPLUS before transfer of funds
Additions to reserves
Transfers between funds
Transfers between funds
NET MOVEMENT IN FUNDS
Fund balance brought forward at
1 August
Balance carried forward at 31 July		 Note
2
4
4
3
5
4
6
6
6
17		 2020 2020 2020 2020 2019 2019 2019 2019
General Funds
£		 Designated
Funds
£		 Restricted
Funds
£		 Total 2020
£		 General Funds
£		 Designated
Funds
£		 Restricted
Funds
£		 Total 2019
£
17,421,096
424,042
87,207		 0
0
0		 0
0
0		 17,421,096
424,042
87,207		 19,804,412
435,956
124,693		 0
0
0		 0
0
0		 19,804,412
435,956
124,693
17,932,345
27,976
598,918
185,134
74,367
852,678
0
0
0
0
59,607
0		 0
71,964
0
0
41,787
0		 17,932,345
99,940
598,918
185,134
175,761
852,678
20,365,061
38,567
801,832
371,980
91,802
17,700
0
0
0
0
70,581
0		 0
648,917
0
0
51,838
0		 20,365,061
687,484
801,832
371,980
214,221
17,700
19,671,418
59,607
113,751
19,844,776
21,686,942
70,581
700,755
22,458,278
694,382
18,853,979		 47,678
(2)		 47,705
161,271		 789,765
19,015,248		 712,312
18,718,601		 57,635
16,152		 71,932
403,660		 841,879
19,138,413
19,548,361
47,676
208,976
19,805,013
19,430,913
73,787
475,592
19,980,292
123,057
11,931
(95,225)		 39,763
2,256,029
(3,206)		 225,163
2,477,986
95,081
0
27,976
11,931

(307,672)

0
(167,189)
(216,861)

71,964
 (60,177)
(524,533)

99,940
 2,217,462
1

38,567
(3,206)

(11,471)

0
 (423,754)
4,380

648,917		 1,790,502

(7,090)

687,484
123,057
(295,741)		 (312,086) (484,770) 2,256,030
(14,677)		 229,543
2,470,896
(1,276,926) 1,276,926 0 0

0

52,394
(52,394)		 0
0
(1,276,926) 1,276,926
0
0
52,394
(52,394)		 0
0
(1,153,869)
11,346,042		 981,185

30,048,154
(312,086)

3,173,460		 (484,770)

44,567,656		 2,308,424

9,037,619
(67,071)

30,115,224		 229,543

2,943,917
2,470,896

42,096,760
10,192,173
31,029,339
2,861,374
44,082,886
11,346,042
30,048,154
3,173,460
44,567,656

All operations of the company continued throughout both years and no operations were acquired or discontinued in either year. The company had no recognised gains or losses in the year other than those above. The statement of financial activities includes the income and expenditure account.

The notes on pages 20 to 36 form an integral part of these financial statements.

17

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

CONSOLIDATED AND CHARITY BALANCE SHEETS

CANFORD SCHOOL LIMITED AS AT 31 JULY 2020

COMPANY REGISTERED NO: 190956

Group
Notes
July
July
2020
2019
£
£
FIXED ASSETS
Cost
43,434,211
39,890,009
Depreciation
(13,578,870)
(12,507,976)
Tangible Fixed Assets
8
29,855,341
27,382,033
INVESTMENTS
Investment in subsidiary undertaking
9
0
0
Investment for composition fees
10
1,158,313
1,809,068
Restricted investments
11
2,721,621
2,944,776
Other investments
11
5,951,778
6,267,520
9,831,712
11,021,364
CURRENT ASSETS
Stocks
12
110,078
147,257
Debtors
13
671,669
675,260
Cash at bank and in hand
10,515,472
12,000,438
11,297,219
12,822,955
CREDITORS: amounts falling due
within one year
14
(6,046,795)
(5,587,742)
NET CURRENT ASSETS
5,250,424
7,235,213
TOTAL ASSETS LESS CURRENT LIABILITIES
44,937,477
45,638,610
CREDITORS: amounts falling due
after more than one year
15
(854,591)
(1,070,954)
NET ASSETS
44,082,886
44,567,656
UNRESTRICTED FUNDS
General fund
10,192,173
11,346,042
Designated funds:
Property fund
25,066,311
23,789,385
Assyrian Fund
5,749,803
6,033,464
Canford Partnership fund
213,225
225,305
RESTRICTED FUNDS
2,861,374
3,173,460
TOTAL FUNDS
17
44,082,886
44,567,656		 Charity
July
July
2020
2019
£
£
43,286,716
39,742,514
(13,451,903)
(12,393,244)
29,834,813
27,349,270
100
100
1,158,313
1,809,068
2,721,621
2,944,776
5,951,778
6,267,520
9,831,812
11,021,464
11,595
30,670
700,781
800,309
10,360,897
11,847,915
11,073,273
12,678,894
(5,813,690)
(5,425,569)
5,259,583
7,253,325
44,926,208
45,624,059
(854,044)
(1,067,125)
44,072,164
44,556,934
10,181,451
11,335,320
25,066,311
23,789,385
5,749,803
6,033,464
213,225
225,305
2,861,374
3,173,460
44,072,164
44,556,934

The loss of the parent charitable company before consolidation was £484,770 (2019: surplus of £2,470,896).

The financial statements were approved and authorised for issue by the Board of Directors on 27 November 2020 and were signed on its behalf by:

David R Levin Stephen Le Bas Chairman Chairman of Finance Committee

The notes on pages 20 to 36 form an integral part of these financial statements.

18

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 JULY 2020

Notes
Net movement in funds
Investment income receivable
(Gains)\losses on investments
Operating surplus for the year
Depreciation
(Profit)\loss on disposal of fixed assets
Amortisation of lease granted over land
Discount given on Composition fees
Decrease \ (increase) in stocks
(Increase)\decrease in debtors
(Decrease)\increase in creditors
Net cash inflow from operating activities
Investing
Investment income received
Purchase of tangible fixed assets
Proceeds from sale of tangible fixed assets
Net Sale(Purchase) of investments
Net movement in composition fee investments
Net cashflow from capital expenditure and
financial investments
Net cash inflow/(outflow) before financing
Financing
Composition fees received
Composition fee payments
Lessee's payments for the reduction of the
outstanding liability relating to a finance lease
Net cashflow from financing
Increase(Decrease) in cash in the year
22
Cash and cash equivalents at the start of the
year
Cash and cash equivalents at the end of the
year		 2020
2019
£
£
(484,770)
2,470,896
(175,761)
(214,221)
524,533
7,091
(135,998)
2,263,766
1,369,236
1,392,146
211,068
(8,437)
(7,666)
(7,666)
15,071
22,106
37,179
17,399
3,591
55,520
787,922
99,362
2,280,403
3,834,196
175,761
214,221
(4,184,115)
(1,626,123)
3,808
14,499
81,805
(236,043)
583,314
131,267
(3,339,427)
(1,502,179)
(1,059,024)
2,332,017
439,695
770,753
(863,359)
(957,006)
(2,278)
(1,563)
(425,942)
(187,816)
(1,484,966)
2,144,201
12,000,438
9,856,237
10,515,472
12,000,438

The notes on pages 20 to 36 form an integral part of these financial statements.

19

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2020

1. ACCOUNTING POLICIES

a) General information

The Charity is a private company limited by guarantee, incorporated in England and Wales (company number 190956) and a charity registered in England and Wales (charity number 306315). The Charity’s registered office address is The Bursary, Canford School, Wimborne, Dorset BH21 3AD.

b)

Basis of accounting

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (Second Edition, effective 1 January 2019) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. Canford School meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s). Financial statements are prepared in pounds sterling rounded to the nearest pound.

These financial statements consolidate the results of the charity and its wholly owned subsidiary Cheneford Limited. In accordance with Section 408 of the Companies Act 2006, no separate Statement of Financial Activities is presented for Canford School Limited.

The Trustees have reviewed the appropriateness of adopting the going concern basis of accounting in preparing the annual financial statements to assess whether the charity was viable in accordance with the new requirement of the UK Corporate Governance Code. The assessment included a review of the budget and principal risks facing the charity, their potential impact, how they were being managed and a review as to the appropriate period for the assessment. This assessment included the short- and mediumterm risks associated with Covid-19. The Trustees are confident that there is a reasonable expectation that the charity will be able to continue in operation and meet its liabilities as they fall due over the one-year period of the assessment.

c) Significant judgements and sources estimation uncertainty

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Charity’s accounting policies. The key judgements that have been applied by management relate to:

d)

Income and expenditure

School fees and operating expenses are included in the financial statements on the accruals basis. Fees receivable are stated after deducting allowance, scholarships and other remissions granted by the school. Entrance and registration fees are credited to income in the year in which they are received. All income and expenditure included in the financial statements is from continuing operations.

Expenditure is allocated to expense headings either on a direct cost basis or apportioned according to the management estimates of time spent or space occupied, as appropriate. VAT is included with the item of expenditure to which it relates.

Governance costs comprise the cost of running the company, including strategic planning for its future development, external audit, and all the costs of complying with constitutional and statutory requirements, such as the cost of governor and committee meetings and preparing financial statements.

e) Termination payments

Termination payments are accounted for in the year in which the commitment is made. This applies to pay in lieu of notice, redundancy payments and payments under compromise agreements.

f)

Donations

Donations of tangible fixed assets are capitalised, and a matching gift in kind is accounted for as a donation within the Statement of Financial Activities. Other donations are accounted for within the Statement of Financial Activities and are recognised when the school is entitled to the receipt.

20

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

g) Repairs and maintenance

Repairs and maintenance expenditure is charged as an operating expense in the year in which it is incurred net of any grants receivable.

h) Investments

The investments are stated at market value, less any provision for permanent diminution in value. It is the company’s policy to keep valuation up to date such that when investments are sold there is no gain or loss arising. As a result, the Statement of Financial Activities only includes those unrealised gains or losses arising from the revaluation of the investment portfolio throughout the year.

The school also holds an investment at cost in its subsidiary, Cheneford Limited, shown in Note 9.

i) Tangible fixed assets and depreciation

Freehold land and buildings

Expenditure relating to the acquisition of and extensions to freehold land and buildings together with the initial equipping thereof is capitalised and is stated in the financial statements at cost less depreciation and any provision for impairment.

No depreciation is charged on freehold land. Leases granted over land are amortised over the term of the lease. Land and buildings are reviewed annually for impairment in accordance with FRS 102.

Depreciation

Tangible fixed assets are stated at cost less accumulated depreciation. Donations of tangible fixed assets are capitalised at their cash value or at estimated cash value if received in kind. Depreciation is provided on tangible fixed assets so as to write off their cost, less estimated residual value, by equal instalments over the expected useful lives of the assets concerned. Assets with a cost of more than £5,000 are capitalised. The estimated useful lives are considered to be as follows:

Freehold buildings - Up to 50 years
Property improvements - 5 – 25 years
Plant and equipment - 7 – 20 years
Computer equipment - 4 – 7 years
Furniture, fixtures and fittings - 10 – 20 years
Motor vehicles - 4 Years

j) Composition fees

Composition fees represent payments in advance in respect of school fees for current and future pupils. These are recorded in the School’s balance sheet as a liability (representing the fees received in advance from parents) and assets (being the investments managed by Rathbone Brothers PLC). A transfer to the revenue account is made each term in respect of school fees which are then due.

k) Stocks

Stocks are stated at the lower of cost and net realisable value.

l) Assets acquired under finance leases

Assets acquired under finance leases, which confer rights and obligations similar to those attached to owned assets are capitalised and included under tangible fixed assets in the balance sheet and are depreciated over the shorter of the lease term and their useful lives.

The capital elements of finance lease obligations are recorded as liabilities while the interest elements are charged to the Statement of Finance Activities over the primary lease period, to produce a constant rate of charge on the balance of capital repayments outstanding.

m) Operating leases

Assets used by the school under operating leases are not capitalised. The costs associated with their rental are charged on a straightline basis over the lease term, even if the payments are not made on such basis.

n) Pensions

The School’s professional teaching staff are members of a Superannuation Scheme operated by the Department for Education and

21

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

Skills. This is a multi-employer defined benefits scheme and individual schools are not able to identify their share of the underlying assets and liabilities of the scheme. The results for the year are stated after charging the relevant employer’s contributions to this scheme.

Other staff are members of a defined contribution scheme. Further information and the basis of accounting is given in Note 21.

o) Taxation

The School is considered to pass the tests set out in paragraph 1 Schedule 6 of the Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the School is potentially exempt from taxation in respect of income or capital gains received within categories covered by Chapter 3 Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes.

p) Financial instruments

The Group only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments, including trade and other debtors and creditors are initially recognised at transaction value and subsequently measured at their settlement value.

q) Government grants

Government grants are accounted for on an accruals basis.

2. FEES

Gross School Fees
Less: scholarships, bursaries, grants and allowances
Add: scholarships funded from Assyrian Fund and from
Scholarship Bursary and Prize Fund		 2020
2019
£
£
19,813,741
21,944,462
(2,549,475)
(2,523,732)
17,264,266
19,420,730
156,830
383,682
17,421,096
19,804,412

22

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

3. INCOME FROM SUBSIDIARY’S TRADING ACTIVITIES

The company owns 99% of the issued share capital of Cheneford Limited, a company registered in England, (Company number: 2694274). The company lets the facilities of the school, including a golf course, for use by the public and various organisations. The subsidiary’s net profit is paid to Canford under a Deed of Covenant.

The subsidiary’s trading results for the year, as extracted from the audited financial statements, are summarised below:

Turnover
Cost of Sales
Gross Profit
Administration expenses
Other operating income
Operating profit
Interest receivable
Interest payable
Net profit		 2020
2019
£
£
608,414
920,776
(539,407) (776,399)
69,007
144,377
(21,319)
(30,491)
0
0
47,688
113,886
107
124
(1,004)
(1,214)
46,791
112,796

Turnover includes £29,407 (2019: £118,944) supplied to the School. Costs include contributions to the overheads of the School totalling £159,072 (2019: £244,476). These intercompany transactions are excluded from the consolidated figures shown on the SOFA and in note 6.

At 31 July 2020 there was a balance of £53,052 (2019: £171,526) owed by Cheneford to Canford School Limited and £3,180 (2019: £338) owed by Canford School Limited to Cheneford Limited.

The subsidiary's balance sheet as at 31 July 2020 as extracted from the audited financial statements is summarised below:

Fixed assets
Current assets
Less current liabilities
Long term liabilities
Net Assets
Called up share capital
Profit and loss account		 2020
2019
£
£
20,528
32,763
280,179
315,926
(289,338) (334,038)
(547)
(3,829)
10,822
10,822
100
100
10,722
10,722
10,822
10,822

23

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

4. OTHER INCOME

4. OTHER INCOME
Other educational charitable activities
Fee income for extra subjects
Entrance and registration fees
Courses and sub lettings
Other ancillary trading income
Ancillary income
Insurance commission
Other income
Other operational income
Amortisation of lease granted over land
CJRS claims		 2020
2019
£
£
320,906
309,745
68,035
81,269
35,101
44,942
424,042
435,956
87,207
124,693
0
0
87,207
124,693
420
10,034
7,666
7,666
844,592
0
852,678
17,700

5. INVESTMENT INCOME

Investment income
Interest received		 General
Funds
Restricted
Funds
2020
Total
General
Funds
Restricted
Funds
2019
Total
£
£
£
£
£
£
59,608
41,787
101,395
70,581
51,838
122,419
74,366
0
74,366
91,802
0
91,802
133,974
41,787
175,761
162,383
51,838
214,221

24

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

6. ANALYSIS OF TOTAL EXPENDITURE

Costs of generating funds:
Fundraising
Trading costs of subsidiary
Finance costs
Charitable Activities
Provision of education
-Teaching
-Welfare
-Premises
-Support costs
Governance
Grants, awards and prizes
Total Expenditure		 Staff
costs
Other
costs
Depreciation
2020
Total
Staff
costs
Other
costs
Depreciation
2019
Total
£
£
£
£
£
£
£
£
110,062
63,984
0
174,046
118,872
98,183
0
217,055
137,387
244,770
12,235
394,392
151,965
286,499
14,662
453,126
0
221,327
0
221,327
0
171,698
0
171,698
247,449
530,081
12,235
789,765
270,837
556,380
14,662
841,879
7,252,660
729,832
0
7,982,492
6,568,167
666,695
0
7,234,862
3,026,958
790,281
0
3,817,239
2,859,261
1,063,472
0
3,922,733
1,294,397
1,853,538
1,357,001
4,504,937
1,196,717
2,124,018
1,377,485
4,698,220
1,749,838
728,024
0
2,477,862
1,895,177
909,694
0
2,804,871
0
64,205
0
64,205
0
51,871
0
51,871
13,323,853
4,165,880
1,357,001
18,846,735
12,519,322
4,815,750
1,377,485
18,712,557
0
168,513
0
168,513
0
425,857
0
425,857
13,323,853
4,334,393
1,357,001
19,015,248
12,519,322
5,241,607
1,377,485
19,138,414
13,571,302
4,864,474
1,369,236
19,805,013
12,790,159
5,797,987
1,392,147
19,980,292

All support costs relate to the provision of education. Support staff costs include the salaries of the Headmaster, Finance, Human Resources, IT, Marketing and Admissions. Other support costs include computer equipment, photocopying equipment, software licences professional fees and the apprenticeship levy.

Group Charity
2020 2019 2020 2019
£ £ £ £
Charitable activities include:
Depreciation on owned assets 1,369,236 1,392,146 1,357,001 1,377,485
Operating leases 68,973 85,240 68,973 85,240
Finance costs include
Bad debts expense 122,901 38,943 119,292 33,260
Governance costs include
Auditors remuneration for
Audit services 17,790 19,220 14,640 16,170
Other service 0 0 0 0

7. STAFF COSTS

Total staff costs were as follows:
Wages and salaries
Social security costs
Pension contributions		 2020
2019
£
£
10,867,894
10,321,746
986,788
945,640
1,716,620
1,522,773
13,571,302
12,790,159

The governors received no remuneration during the year (2019: £nil). No related party transactions occurred during the year (2019: £nil). Two trustees have a child in the school paid at standard rates. Two trustees have children / grandchildren who receive merit-

25

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

based scholarships. The related trustees were not involved in the decisions to make these awards.

An aggregate amount of £2,3030 was reimbursed to 5 governors during the year, in respect of travel expenses (2019: £2,681 to 3 governors).

governors).
2020 2019
No. No.
Staff numbers
The number of employees in the year were: 486 468
The number of employees whose emoluments exceeded £60,000 were
£60,001 to £70,000 18 20
£70,001 to £80,000 4 3
£80,001 to £90,000 3 0
£90,001 to £100,000 0 1
£110,001 to £120,000 1 0
£170,001 to £180,000 0 1
£180,001 to £190,000 1 0

The employer pension contributions paid for the above higher-paid staff were £383,390 (2019: £275,794). £325,774 (2019: £224,346) was paid to the Teachers' Pension Scheme, a defined benefit scheme, and £57,616 (2019: £51,448) to other schemes.

There are a number of key management personnel in the School including the Senior Management Team and the Support Staff Senior Management Team. The total amount of remuneration, benefits (excluding those listed below) and pensions paid to this group of individuals was £1,642,209 (2019: £1,629,066).

In addition to the payments contained in the bandings above, the School provides fee remission to teaching and some senior staff typical for the independent school sector and accommodation (or reimbursement for own accommodation) to staff who are entitled to accommodation by virtue of their role.

Pension contributions and commitments

Teaching staff are eligible to contribute to the Teachers' Pension Scheme. Support staff are eligible to contribute to a personal pension plan, which is a defined contribution scheme administered by Scottish Widows. All schemes permit staff to make additional voluntary contributions.

Further details relating to these pension schemes are set out in note 21.

Pension contributions
Total employer contributions incurred during the year were:
Teaching staff
Support staff
Redundancy & Termination Payments
made in the year totalled		 2020
2019
£
£
1,081,898
747,295
634,722
775,478
1,716,620
1,522,773
2020
2019
£
£
74,270
56,134
  1. TANGIBLE FIXED ASSETS – GROUP

26

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

Freehold Plant & Computer Furniture, Motor Total
property equipment equipment fixtures & vehicles
fitings
£ £ £ £ £ £
Historic cost
Opening - 1st August 32,291,154 3,846,747 1,825,396 1,729,154 197,558 39,890,009
Transfers 0 0 0 0 0 0
Additions 2,197,258 1,401,843 88,623 369,696 0 4,057,420
Disposals (467,310) (16,299) (207) (29,402) 0 (513,218)
Closing - 31st July 34,021,102 5,232,291 1,913,812 2,069,448 197,558 43,434,211
Depreciation
Opening - 1st August 8,501,770 1,833,587 1,289,621 703,238 179,760 12,507,976
Transfers 0 0 0 0 0 0
Charge in year 711,987 376,771 140,971 129,141 10,366 1,369,236
Disposals (258,965) (16,299) (82) (22,996) 0 (298,342)
Closing - 31st July 8,954,792 2,194,059 1,430,510 809,383 190,126 13,578,870
Net Book Value
Opening - 1st August 23,789,384 2,013,160 535,775 1,025,916 17,798 27,382,033
Closing - 31st July 25,066,310 3,038,232 483,302 1,260,065 7,432 29,855,341
8. TANGIBLE FIXED ASSETS – CHARITY
Freehold Plant & Computer Furniture, Motor Total
property equipment equipment fixtures & vehicles
fitings
£ £ £ £ £ £
Historic cost
Opening - 1st August 32,291,154 3,710,341 1,814,307 1,729,154 197,558 39,742,514
Transfers 0 0 0 0 0 0
Additions 2,197,258 1,401,843 88,623 369,696 0 4,057,420
Disposals (467,310) (16,299) (207) (29,402) 0 (513,218)
Closing - 31st July 34,021,102 5,095,885 1,902,723 2,069,448 197,558 43,286,716
Depreciation
Opening - 1st August 8,501,770 1,729,944 1,278,532 703,238 179,760 12,393,244
Transfers 0 0 0 0 0 0
Charge in year 711,987 364,536 140,971 129,141 10,367 1,357,002
Disposals (258,966) (16,299) (82) (22,996) 0 (298,343)
Closing - 31st July 8,954,791 2,078,181 1,419,421 809,383 190,127 13,451,903
Net Book Value
Opening - 1st August 23,789,384 1,980,397 535,775 1,025,916 17,798 27,349,270
Closing - 31st July 25,066,311 3,017,704 483,302 1,260,065 7,431 29,834,813

8. TANGIBLE FIXED ASSETS – CHARITY

9. INVESTMENTS

27

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

Group Group Charity Charity
2020 2019 2020 2019
£ £ £ £
Investment in subsidiary undertaking - - 100 100

10. COMPOSITION FEES

10. COMPOSITION FEES
At 1 August 2019
Composition fees received
Income arising from investments
Management fees and similar charges
Applied to school fees
Net Movement in the year
Total liability as at 31 July 2020
Unrealised gain/(loss)on investments
At 31 July 2020
Represented by:
Investment with Rathbones (2019 Ruffer)
Cash at bank
Interest Receivable
Amounts falling due within one year
Amounts falling due after one and within five years
Amount falling due after five years
Composition Fees Reserve		 2020
2019
£
£
1,944,150
2,134,007
439,695
770,753
(45,092)
61,738
(11,847)
(20,179)
(863,359)
(957,006)
(480,603)
(144,694)
1,463,547
1,989,313
(7,012)
(45,163)
1,456,535
1,944,150
1,158,313
1,809,068
298,222
135,082
0
0
1,456,535
1,944,150
625,597
833,630
696,247
896,806
1,321,844
1,730,436
134,691
213,714
1,456,535
1,944,150

The investments are managed by Rathbone Brothers PLC in accordance with an investment policy established by the school as a trustee. The surplus of funds invested over liabilities has been recognised and is shown as a restricted reserve.

28

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

2020 2019
£ £
Investments representing Composition Fees Funds
Investments representing restricted funds at cost 1,165,325 1,854,231
Market value of assets representing restricted funds 1,158,313 1,809,068
The funds are invested by Rathbones (2019 Ruffer)
UK equities 422,301 165,609
Overseas equities 261,582 569,187
Index linked 217,497 662,671
Other 217,421 304,737
Cash and commitments 39,512 106,864
1,158,313 1,809,068
11. OTHER INVESTMENTS
a) Assyrian Fund
Cost of assets representing School Funds
Market value of assets representing School Funds
The funds are invested by Rathbones (2019 Ruffer)
UK equities
Overseas equities
Index linked
Other
Cash and commitments
b) Other Assets held as Investments
Market value of assets representing School Funds
Total Other Investments		 2020
2019
£
£
5,965,675
6,455,939
5,943,028
6,258,770
2020
Total
2019
Total
£
£
1,761,050
576,160
2,069,625
1,975,558
516,403
2,318,561
1,059,734
1,039,621
536,216
348,870
5,943,028
6,258,770
8,750
8,750
5,951,778
6,267,520

29

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

2020 2019
£ £
**c) ** Restricted Funds - Scholarship, Bursaries and Prize Fund
Investments representing restricted funds at cost 2,763,968 2,966,572
Market value of assets representing restricted funds 2,721,621 2,944,776
The funds are invested by Rathbones (2019 Ruffer)
2020 2019
Total Total
£ £
UK equities 829,318 253,508
Overseas equities 950,230 880,465
Index linked 103,206 1,034,377
Other 219,117 476,595
Cash and commitments 619,750 299,831
2,721,621 2,944,776

The investments are managed by Rathbones Investment Management Ltd (from February 2020, taken over from Ruffer LLP) in accordance with an investment policy established by the School as trustee. Notes 17 and 18 show the funds to which these investments relate.

12. STOCKS

12. STOCKS
Group Charity
2020 2019 2020 2019
£ £ £ £
Goods for resale 110,078 147,257 11,595 30,670

The replacement cost of stocks is not considered to be materially different from their historical costs.

13. DEBTORS

Debtors in respect of school fee account
Amounts owed by subsidiary undertaking
Other debtors
Prepayments and accrued income		 Group
Charity
2020
2019
2020
2019
£
£
£
£
69,306
177,250
69,306
177,250
0
0
53,052
171,526
224,135
74,579
203,410
31,882
378,228
423,431
375,013
419,651
671,669
675,260
700,781
800,309

30

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

14. CREDITORS: amounts falling due within one year

14. CREDITORS: amounts falling due within one year
School fees paid on account
Composition fees (see note 10)
Trade creditors
Amounts owed to subsidiary undertaking
Other creditors
Taxation & social security
Finance lease obligations
Accruals and deferred income		 Group
Charity
2020
2019
2020
2019
£
£
£
£
2,642,312
2,171,038
2,642,312
2,171,038
625,597
833,630
625,597
833,630
548,186
692,373
535,641
677,154
0
0
3,180
338
564,354
398,001
458,249
311,161
272,763
274,979
262,733
271,054
2,810
1,806
0
0
1,390,773
1,215,915
1,285,978
1,161,194
6,046,795
5,587,742
5,813,690
5,425,569

15. CREDITORS: amounts falling due after more than one year

Composition fees due 2 - 5 years (see note 10)
Composition fees due more than 5 years (see note 10)
Deferred Income due 2 - 5 years
Deferred Income more than 5 years
Finance lease obligations due 2 - 5 years
Finance lease obligations more than 5 years
Pension Scheme Deficit 2 - 5 years (see note 21)
Pension Scheme Deficit more than 5 years (see note 21)		 Group
Charity
2020
2019
2020
2019
£
£
£
£
696,247
896,806
696,247
896,806
0
0
0
0
30,664
30,664
30,664
30,664
107,324
114,990
107,324
114,990
547
3,829
0
0
0
0
0
0
19,809
21,665
19,809
21,665
0
3,000
0
3,000
854,591
1,070,954
854,044
1,067,125

The Deferred Income relates to a lease granted over land and is amortised over the life of the lease.

16. MOVEMENT IN TOTAL DEFERRED INCOME

As at 1st August
New Deferred Income
Released to SOFA
As at 31st July		 Group
Charity
2020
2019
2020
2019
£
£
£
£
227,060
242,113
184,580
193,196
91,569
78,836
21
36,355
(81,407)
(93,889)
(38,926)
(44,971)
237,222
227,060
145,675
184,580

31

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

17. FUNDS

Unrestricted Funds
Assyrian Fund
Canford Partnership Fund
Designated Property Fund
General Fund
Total Unrestricted School Funds
Restricted Funds
Composition Fees Fund
Scholarship Bursary and Prize Fund
Total Restricted School Funds
Total Charity Funds
Subsidiary Reserves		 1 August
2018
Income
Expenditure
Gain(Loss) on
Investment
Assets
Transfer
Between
Funds
1 August
2019
Income
Expenditure
Gain(Loss)
on
Investment
Assets
Transfer
Between
Funds
31 July
2020
£
£
£
£
£
£
£
£
£
£
£
6,030,993
67,901
(55,160)
(10,270)
0
6,033,464
57,540
(46,000)
(295,201)
0
5,749,803
242,453
2,680
(18,625)
(1,203)
0
225,305
2,069
(1,678)
(12,471)
0
213,225
23,841,778
0
0
0
(52,393)
23,789,385
0
0
0
1,276,926
25,066,311
30,115,224
70,581
(73,785)
(11,473)
(52,393)
30,048,154
59,609
(47,678)
(307,672)
1,276,926
31,029,339
9,026,896
21,242,262
(18,986,231)
0
52,393
11,335,320
19,278,257
(19,155,200)
0
(1,276,926) 10,181,451
39,142,120
21,312,843
(19,060,016)
(11,473)
0
41,383,474
19,337,866
(19,202,878)
(307,672)
0
41,210,790
239,422
791,906
(813,038)
(4,577)
0
213,713
455,031
(466,612)
(67,441)
0
134,691
2,704,495
679,604
(433,311)
8,959
0
2,959,747
98,414
(182,058)
(149,420)
0
2,726,683
2,943,917
1,471,510
(1,246,349)
4,382
0
3,173,460
553,445
(648,670)
(216,861)
0
2,861,374
42,086,037
22,784,353
(20,306,365)
(7,091)
0
44,556,934
19,891,311
(19,851,548)
(524,533)
0
44,072,164
10,723
920,900
(920,900)
0
0
10,723
628,432
(628,432)
0
0
10,723
42,096,760
23,705,253
(21,227,265)
(7,091)
0
44,567,657
20,519,743
(20,479,980)
(524,533)
0
44,082,886

The total of the Income and Expenditure in each year above matches the Net Income before transfers and investments gains/(losses) on the SOFA.

The cost of scholarships in the year from the Assyrian Fund and the Scholarship, Bursary and Prize Funds are included within the total for "scholarships, bursaries, grants and allowances" in note 2.

Purpose of funds

Unrestricted Funds

Assyrian Fund This is designated for annual scholarship and bursary awards to students. Canford Partnership Fund This is designated for work carried out by pupils on trips to orphanages in countries such as Argentina, Ghana and India.

Designated Property Fund This is designated to match the value of the investment made over the years in the fabric of School buildings.

General Fund General reserves are available to the group. Governors monitor this fund on a regular basis, considering the working capital management of the School and the desire to continually improve facilities.

Restricted Funds Composition Fees Fund This is restricted to the advance payment of fees, and represents funds received in respect of school fees for current and future pupils.

Scholarship Bursary and Prize Fund This is restricted to terms set out by donors for the provision of scholarships, bursaries and prizes.

Transfers between funds

£1,276,926 was transferred to the designated property fund from the general fund to match the movement in net book value of freehold land and buildings.

32

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

18. ALLOCATION OF NET ASSETS TO FUNDS

Unrestricted General Fund
Unrestricted School Funds
Assyrian Fund
Canford Partnership Fund
Designated Property Fund
Restricted Funds
Composition Fees Fund
Scholarship Bursary and Prize Fund		 Fixed
assets
Investments
Other net
assets/
(liabilities)
Long term
liabilities
2020
Total
Fixed
assets
Investments
Other net
assets/
(liabilities)
Long term
liabilities
2019
Total
£
£
£
£
£
4,789,030
8,750
5,552,737
(158,344) 10,192,173
3,592,648
8,751
7,918,791
(174,148) 11,346,042
0
5,729,803
20,000
0
5,749,803
0
6,033,464
0
0
6,033,464
0
213,225
0
0
213,225
0
225,305
0
0
225,305
25,066,311
0
0
0
25,066,311
23,789,385
0
0
0
23,789,385
25,066,311
5,943,028
20,000
0
31,029,339
23,789,385
6,258,769
0
0
30,048,154
0
1,158,313
(327,375)
(696,247)
134,691
0
1,809,068
(698,549)
(896,806)
213,713
0
2,721,621
5,062
0
2,726,683
0
2,944,776
14,971
0
2,959,747
0
3,879,934
(322,313)
(696,247)
2,861,374
0
4,753,844
(683,578)
(896,806)
3,173,460
29,855,341
9,831,712
5,250,424
(854,591) 44,082,886
27,382,033
11,021,364
7,235,213
(1,070,954) 44,567,656

19. OPERATING LEASE COMMITMENTS

At 31 July 2020 the company's future minimum operating lease payments are as follows:

Group Group Charity Charity
2020 2019 2020 2019
£ £ £ £
Within one year 78,441 78,490 74,204 77,959
Between 1 and 5 years 117,963 148,593 106,438 148,593

At 31 July 2020 the company's future minimum operating lease income is as follows:

Group Group Charity Charity
2020 2019 2020 2019
£ £ £ £
Within one year 7,666 7,666 7,666 7,666
Between 1 and 5 years 38,330 38,330 38,330 38,330
Over 5 years 107,323 114,989 107,323 114,989

20. CAPITAL COMMITMENTS

Capital expenditure authorised and contracted for at the balance sheet date amounted to £7,363,490 (2019: £189,571).

21. PENSIONS

The Group operates two pension schemes: Teachers are enrolled in the Teachers’ Pension Scheme and Support Staff are offered a Scottish Widows Group Personal Pension Plan. Staff who do not elect to join one of two schemes offered are swept up into the Scottish Widows scheme under auto-enrolment rules. The School is also responsible for paying a share of the pension costs for employees of the Allied School Agency Limited which provides company secretarial and other services to the School through The Pensions Trust Growth Plan. The figures shown below include this liability.

Teachers Pensions

33

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

The School participates in the Teachers’ Pension Scheme (“the TPS”) for its teaching staff. The pension charge for the year includes contributions payable to the TPS of £1,161,746 (2019: £796,226).

The TPS is an unfunded multi-employer defined benefits pension scheme governed by The Teachers’ Pensions Regulations 2010 (as amended) and The Teachers’ Pension Scheme Regulations 2014 (as amended). Members contribute on a “pay as you go” basis with contributions from members and the employer being credited to the Exchequer. Retirement and other pension benefits are paid by public funds provided by Parliament.

The employer contribution rate is set by the Secretary of State following scheme valuations undertaken by the Government Actuary’s Department. The most recent actuarial valuation of the TPS was prepared as at 31 March 2016 and the Valuation Report, which was published in March 2019, confirmed that the employer contribution rate for the TPS would increase from 16.4% to 23.6% from 1 September 2019. Employers are also required to pay a scheme administration levy of 0.08% giving a total employer contribution rate of 23.68%.

The 31 March 2016 Valuation Report was prepared in accordance with the benefits set out in the scheme regulations and under the approach specified in the Directions, as they applied at 5 March 2019. However, the assumptions were considered and set by the Department for Education prior to the ruling in the ‘McCloud/Sargeant case’. This case has required the courts to consider cases regarding the implementation of the 2015 reforms to Public Service Pensions including the Teachers’ Pensions.

On 27 June 2019 the Supreme Court denied the government permission to appeal the Court of Appeal’s judgment that transitional provisions introduced to the reformed pension schemes in 2015 gave rise to unlawful age discrimination. The government is respecting the Court’s decision and has said it will engage fully with the Employment Tribunal as well as employer and member representatives to agree how the discriminations will be remedied. A consultation was launched by the government on 16 July 2020 and closed to responses on 11 October 2020.

The TPS is subject to a cost cap mechanism which was put in place to protect taxpayers against unforeseen changes in scheme costs. The Chief Secretary to the Treasury, having in 2018 announced that there would be a review of this cost cap mechanism, in January 2019 announced a pause to the cost cap mechanism following the Court of Appeal’s ruling in the McCloud/Sargeant case and until there is certainty about the value of pensions to employees from April 2015 onwards. The pause was lifted in July 2020 and the government is preparing to complete the cost control element of the 2016 valuations, which is expected to be completed in 2021.

In view of the above rulings and decisions the assumptions used in the 31 March 2016 Actuarial Valuation may become inappropriate. In this scenario, a valuation prepared in accordance with revised benefits and suitably revised assumptions would yield different results than those contained in the Actuarial Valuation.

Until the consultation and the cost cap mechanism review are completed it is not possible to conclude on any financial impact or future changes to the contribution rates of the TPS. Accordingly, no provision for any additional past benefit pension costs is included in these financial statements.

The Pensions Trust Growth Plan

To fulfil the School's responsibility to the Allied Schools Agency Limited the company participates in this multi-employer scheme which provides benefits to some 950 non-associated participating employers. The scheme is a defined benefit scheme in the UK. It is not possible for the company to obtain sufficient information to enable it to account for the scheme as a defined benefit scheme. Therefore, it accounts for the scheme as a defined contribution scheme.

The scheme is subject to the funding legislation outlined in the Pensions Act 2004 which came into force on 30 December 2005. This, together with documents issued by the Pensions Regulator and Technical Actuarial Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK.

The scheme is classified as a 'last-man standing arrangement'. Therefore, the company is potentially liable for other participating employers' obligations if those employers are unable to meet their share of the scheme deficit following withdrawal from the scheme. Participating employers are legally required to meet their share of the scheme deficit on an annuity purchase basis on withdrawal from the scheme.

A full actuarial valuation for the scheme was carried out at 30 September 2017. This valuation showed assets of £794.9m, liabilities of £926.4m and a deficit of £131.5m. To eliminate this funding shortfall, the Trustee has asked the participating employers to pay additional contributions to the scheme as follows:

34

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

Overall Scheme Deficit Contributions

From 1 April 2019 to 31 January 2025: £11,343,000 per annum (payable monthly and increasing by 3% each on 1st April).

Company Deficit Contributions

From 1 April 2016 to 30 September 2028: £5,234 per annum (payable monthly and increasing by 3% each on 1st April).

The recovery plan contributions are allocated to each participating employer in line with their estimated share of the Series 1 and Series 2 scheme liabilities.

Where the scheme is in deficit and where the company has agreed to a deficit funding arrangement the company recognises a liability for this obligation. The amount recognised is the net present value of the deficit reduction contributions payable under the agreement that relates to the deficit. The present value is calculated using the discount rate detailed in these disclosures. The unwinding of the discount rate is recognised as a finance cost.

PRESENT VALUES OF PROVISION
RECONCILIATION OF OPENING AND CLOSING PROVISIONS
Deficit contribution paid
Remeasurements - impact of any change in assumptions
Provision at end of period
Remeasurements - amendments to the contribution schedule
Present value of provision
Provision at start of period
Unwinding of the discount factor (interest expense)
INCOME AND EXPENDITURE IMPACT
includes defined contribution schemes and future service contributions (i.e. excluding any deficit reduction
payments) to defined benefit schemes which are treated as defined contribution schemes.
Interest expense
Remeasurements - impact of any change in assumptions
Remeasurements - amendments to the contribution schedule
Contributions paid in respect of future service
Costs recognised in income and expenditure account
ASSUMPTIONS
Rate of discount		 31-Jul-20 31-Jul-19
(£000s)
(£000s)
25
30
Period
Ending
Period
Ending
31-Jul-20 31-Jul-19
(£000s)
(£000s)
30
47
0
1
(5)
(6)
0
1
0
(13)
25
30
Period
Ending
Period
Ending
31-Jul-20 31-Jul-19
(£000s)
(£000s)
0
1
0
1
0
(13)
0
0
0
(11)
31-Jul-20 31-Jul-19
% per
annum
% per
annum
0.60
1.00

The discount rates shown above are the equivalent single discount rates which, when used to discount the future recovery plan

35

CANFORD SCHOOL LIMITED

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 JULY 2020

contributions due, would give the same results as using a full AA corporate bond yield curve to discount the same recovery plan contributions.

The following schedule details the deficit contributions agreed between the company and the scheme at each year end period:

DEFICIT CONTRIBUTIONS SCHEDULE

Year ending **31-Jul-20 ** 31-Jul-19
(£000s) (£000s)
Year 1 5 5
Year 2 6 5
Year 3 6 6
Year 4 6 6
Year 5 3 6
Year 6 0 3
Year 7 0 0
Year 8 0 0
Year 9 0 0
Year 10 0 0

The company must recognise a liability measured as the present value of the contributions payable that arise from the deficit recovery agreement and the resulting expense in the income and expenditure account i.e. the unwinding of the discount rate as a finance cost in the period in which it arises.

It is these contributions that have been used to derive the company's balance sheet liability.

22. ANALYSIS OF CHANGES IN NET DEBT

Cash
Composition fees
Finance lease obligation		 1 August
2019
Cashflows
New
Finance
Leases
Fair Value
Movements
Foreign
Exchange
Movements
Other Non
Cash
Movements
31 July
2020
12,000,438
(1,484,966)
0
0
0
0
10,515,472
(1,730,437)
423,666
0
0
0
(15,071) (1,321,842)
(5,635)
2,278
0
0
0
0
(3,357)
10,264,366
(1,059,022)
0
0
0
(15,071)
9,190,273

36