Registered Charity Number: 310018 

## **MERCHANT TAYLORS’ EDUCATIONAL TRUST** 

## **TRUSTEES’ REPORT AND FINANCIAL STATEMENTS** 

**YEAR ENDED 31 AUGUST 2020** 



MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

## **INDEX** 

|Trustees’ Report|3|
|---|---|
|Objectives and Activities|3|
|Achievements and Performance|5|
|Financial Review|5|
|Future Plans|7|
|Structure, Governance and Management|7|
|Reference and Administrative Details|10|
|Statement of the Trustees’ Responsibilities|13|
|Independent Auditors’ Report|14|
|Consolidated Statement of Financial Activities|17|
|Consolidated Balance Sheet|18|
|Trust Balance Sheet|19|
|Consolidated Cash Flow Statement|20|
|Accounting Policies|21|
|Notes to the Financial Statements|24|



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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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The Trustees submit their report and financial statements for the year ended 31 August 2020. The financial statements have been prepared in accordance with the accounting policies set out in Note 1 to the accounts and comply with the Charity’s governing document, the Charities Act 2011 and Accounting and Reporting by Charities: Statement of Recommended Practice (FRS102), Second Edition, applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard, applicable in the UK and Republic of Ireland. 

Please note that the financial statements include those that relate to the Charity alone as well as those that are consolidated with the Charity’s two schools, Merchant Taylors’ School (registered charity number 1063740 and referred to below as MTSN) and St. John’s School (registered charity number 1063738). Further details about MTSN and St John’s School (together referred to below as the MTET Schools) can be found in the MTET Schools’ own financial statements. The Charity and the MTET Schools collectively are referred to below as the Group. 

## **OBJECTIVES AND ACTIVITIES** 

## **Charitable objects** 

The overarching object of the Charity, as noted in its Deed of Trust (1967), is as follows: 

The Trust Property shall be held and applied for or towards or for the benefit or in furtherance of such charitable purposes, charitable institutions or charitable foundations (whether educational or otherwise) in such manner and in such proportions as the Trustees may from time to time determine and both capital and income without distinction shall be so applicable. 

While this remains unchanged, the objects to which the Charity pays special regard have been the subject of recent review by the Trustees, as the Deed of Trust permits. By Deed of Variation dated 22 March 2021, they are now as follows: 

- (a) The advancement of education through the provision of support to the MTET Schools. 

- (b) The advancement of education through the provision of scholarships, bursaries, prizes or other awards or grants to pupils attending any of the MTET Schools who are in need of financial assistance. 

- (c) The advancement of education through the provision of scholarships, prizes, maintenance allowances or grants to any former pupil of any of the MTET Schools tenable at any university, college of education, or other institution of further (including professional and vocational) education. 

In planning their activities for the year, the Trustees have complied with their duties in section 17(5) of the Charities Act 2011 and have considered the Charity Commission’s guidance on public benefit, and in particular its supplementary guidance on advancing education and fee charging. 

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## MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

## **Aims** 

The Trustees aim to support the good governance of the MTET Schools in their legal ownership by making appropriate appointments to the governing bodies; providing financial support to the MTET Schools commensurate with the resources at their disposal and the objects of the funds under their control; and supporting initiatives in the education sector more generally in which they have an interest and to which they are able to apply their expertise and their contacts to advantage. 

## **Objectives** 

The Charity’s objectives for the year were to continue to ensure the appropriate composition of the governing bodies of the MTET Schools by engaging with them and considering recommendations for appointments to and retirements from those governing bodies. Furthermore, the Charity sought to maximise income and to continue to support both the MTET Schools and the educational interests of MTET and the Merchant Taylors’ Company (referred to below as MTC). 

An additional objective for this year was to ensure that the MTET Schools were able, in the context of the Covid-19 pandemic, to continue to function effectively and offer an outstanding education to their pupils. 

## **Activities** 

The Education Strategy approved by MTC in May 2019 continued to set the context for much of the work undertaken by the Trustees. 

The Strategy aims, among other things, to promote the highest quality of education, particularly for those from disadvantaged backgrounds, and to support and advocate the value of the schools with which the Company is associated. 

To those ends, the Trustees disbursed £196,000 to MTSN for bursaries, with the intention that such bursaries be provided to students who would not otherwise be able to be educated at the school. A further £3,400 was awarded in leaving prizes to students leaving MTSN to embark on university study, and a sum of £30,000 was disbursed to The Merchant Taylors’ Foundation (formerly The Merchant Taylors’ Company Education Fund) (registered charity number 1161568), to fund bursaries at other schools and higher education institutions with which MTC is associated. 

The Trustees also reviewed the composition and effectiveness of the governing bodies of the MTET Schools, making appointments and accepting resignations as necessary to effect compliance with stated terms of office and to ensure continued good governance of the schools. 

Finally, the Trustees were alert to the continuing impact of the Covid-19 pandemic and were pleased to receive regular reports from both Heads and Chairs of Governors at the MTET Schools about how such impact was being managed and mitigated. 

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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## **Public benefit** 

The Trustees confirm that they have complied with the duty in section 4 of the Charities Act 2011 to have due regard to the Charity Commission’s general guidance on public benefit, ‘Charities and Public Benefit’. 

The Charity’s activities as outlined above, and in particular its provision of bursaries to the MTET Schools and (through its donation to The Merchant Taylors’ Foundation) a broader group of educational establishments, aim to further the public benefit enshrined in its charitable objects. Moreover, the MTET Schools, whose financial statements are here consolidated with those of the Trust, themselves provide a wide range of public benefit activities from supporting local and national charities to offering educational opportunities and access to facilities to local schools and families. Further description is available in the respective Trustees’ Reports of the MTET Schools. Further information about the basis for consolidation of the accounts can be found in Accounting Policies below. 

## **ACHIEVEMENTS AND PERFORMANCE** 

## **Governance update** 

The Trustees were pleased to make a number of new governor appointments as well as to re-appoint governors who had come to the end of their first term of office. 

## **Investment performance** 

The investment income for the Charity amounted to £234,296 (2019: £322,820) – a drop that is fully attributable to the impact of the Covid-19 pandemic. Given the market conditions over the year as a whole and the fact that, while the pandemic had a significant impact on gross income and expenditure for the year (if not on the bottom line), the Trustees are content with the yield of 2.8% and with the total return on the Charity’s Endowment of 8.4%. 

## **FINANCIAL REVIEW** 

## **Investment powers and policy** 

The Trustees’ investment policy is that income should be maximised as far as possible whilst seeking to ensure capital growth. The Charity has adopted Rathbones’ policy of responsible investment. Through a holistic appraisal of investment, opportunity and risk, Rathbones aim to take an informed and active approach to responsible investment by incorporating a thorough consideration of environmental, social and governance (ESG) factors and continuing meaningful engagement with the companies in which they invest. 

The investments are managed on a discretionary basis on a medium risk profile. It has a balanced mandate meaning the investments are managed for a combination of capital and growth. Performance is measured against a primary benchmark measured with reference to a composite 

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ index from other funds, and a secondary benchmark over the longer term of RPI +  3.5%. 

The Trustees review this investment policy annually and no changes were made to it this year. 

## **Financial reserves** 

The MTET Schools’ total reserves are considered appropriate. 

The Trustees’ policy is to retain around £200,000 via the unrestricted funds, historically referred to as the “Original Endowment Fund” as an expendable reserve in order to maintain a reactive capacity to support compelling educational causes which may arise and meet any unforeseen expenditure. As at 31 August 2020 the Fund held £1,457,169 (2019: £1,453,966, restated, see note 14) for these purposes. 

The Trustees do not feel that they are exposed to operational risks of the sort that would require or be ameliorated by emergency expenditure. A reserve is retained in order that there should be a capacity to respond to urgent and/or compelling cases for support. The Trustees believe that the current reserves policy would be sufficient to cover this eventuality, given the nature and size of the awards made historically, and the size of the capital balance which is expendable at Trustees’ discretion. 

The Trustees plan to review their reserves policy over the next year to ensure it is appropriate for the nature and extent of activities planned for the coming period. 

## **Risk management** 

The Trustees consider, at their meetings, any risks to which the Charity may be exposed. These were identified during the year along with mitigation activity and lead responsibilities. The major financial risk to which the Charity itself is exposed is a diminution in the value of, and yield from, its investments. Investments in financial instruments are monitored closely, with regular scrutiny of investment managers’ performance taking place, assisted by the Merchant Taylors’ Company’s Investment Committee, on which one Trustee sits. Other risks associated with the MTET Schools are managed by close and effective links between the MTET Schools and the Charity. 

The MTET Schools have Risk Management Committees which compile Risk Registers annually to identify the likelihood and impact of foreseeable risks to the MTET Schools’ operations. The Risk Registers are presented to and considered by Boards of Directors/Governors and reviewed at relevant committees for assigned ‘actions’ and any in-year amendments required. The Boards of Directors/Governors manage and mitigate risk through a range of control measures, including cash-flow monitoring, formal written policies and the obtaining of independent advice from appropriate experts, and Trustees have been available to offer appropriate advice when and if necessary. 

## **Fundraising** 

The Trustees take their responsibilities under the Charities (Protection and Social Investment) Act 2016 seriously and have considered the implications thereof on the MTET Schools’ fundraising 

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ activities. The Charity supports the MTET Schools’ approach to fundraising, which is essentially to seek philanthropic funding from a variety of constituencies, including alumni, parents of pupils, parents of alumni, friends of the MTET Schools and charitable trusts and foundations. The MTET Schools act in accordance with the Code of Fundraising Practice set out by the Fundraising Regulator and are committed to meeting high fundraising standards. As a result of this, no complaints about the MTET Schools’ fundraising activities have been received. 

## **A review of the financial position at the end of the period** 

The Charity’s Endowment Funds stood at £5,182,083 (2019: £5,315,425 restated) and the Restricted Fund stood at £1,466,585 (2019: £1,371,559 restated). The Group’s accounts – those of the Charity consolidated with those of the MTET Schools - show an overall surplus before investment losses of £1,766,169 (2019: £1,754,223). The net result after investment losses was £1,707,392 (2019: £1,736,103) 

While the Covid-19 pandemic has had an undoubted impact on the Group’s gross income and expenditure, the Trustees were generally satisfied with the financial position at the end of the period and they continue to review the position regularly and carefully. 

## **FUTURE PLANS** 

The Trustees plan to support the MTET Schools and participate in relevant activity of the MTC’s Education Strategy, especially that which relates to the provision of educational opportunities for disadvantaged young people. 

It plans also to give consideration to the potential use of Unrestricted Funds in the Charity’s Original Endowment Fund (renamed in February 2021 as the Unrestricted Fund), with a view to identifying potential beneficiaries and activity that further the Charity’s objects and the wider educational work of the MTC, as well as for the purposes of identifying an ‘operating sum’ for the payment of costs relating to insurance, auditing and other regular operations. 

The Trustees also plan to continue working with both the MTET Schools and MTC to identify and update risks and ensure that responsibilities and activities relating to risk mitigation are clear and coherent across all parties. 

Related to this, the Trustees will continue to review carefully the impact of the Covid-19 pandemic on the Charity’s assets and the MTET Schools. 

## **STRUCTURE, GOVERNANCE AND MANAGEMENT** 

## **Governing document** 

The Charity is governed by a Trust Deed dated 31 August 1967. On behalf of the Settlor, the Merchant Taylors’ Company, and having become the sole Guarantor upon incorporation in 1997, the Trustees appoint the Governors of MTSN and St John’s School, who thereafter are responsible 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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for management and control of these schools. 

The Consolidated Financial Statements of the Charity incorporate all of the funds under the direct control of the Trustees, as well as the MTET Schools and other entities whose governing bodies are appointed by the Trustees, and these are as follows: 

## **Endowment funds** 

The Charity has an Original Endowment Fund (renamed in February 2021 as the Unrestricted Fund due to reclassification) whose income and capital may be spent, at the Trustees’ absolute discretion, in furtherance of any of the Charity’s charitable objects. It also holds a Bursary and Scholarship Trust and an MTET Prize Fund, whose sole objects are to support the provision of awards to support pupils and former pupils of MTSN. Their income is disbursed each year for that purpose, subject to satisfactory reports concerning MTSN’s overall programme of support for boys in need of financial assistance towards their education. 

## **Merchant Taylors’ School** 

Merchant Taylors’ School was founded in 1561 by the Company in the City of London. In 1933 the School moved to its present site at Sandy Lodge in Northwood, Middlesex. On 1 August 1997 Merchant Taylors’ School was incorporated as a charitable company limited by guarantee. On the 3 September 2015 Northwood Prep merged with Merchant Taylors’ School. The School provides day schooling for boys between the ages of 3 to 18. 

## **St John’s School, Northwood** 

St John’s School, Northwood, a preparatory school, was purchased by the Company in 1984, and a pre-preparatory department was added in 1986. On 1 August 1997 St John’s School was incorporated as a charitable company limited by guarantee. The School provides day schooling for boys between the ages of 3 to 13. 

## **Merchant Taylors’ School Enterprises Limited** 

Merchant Taylors’ School Enterprises Limited (MTSEL) was incorporated in 1988 as the trading company of Merchant Taylors’ School, and is wholly owned by the School as from October 2008. 

## **Appointment of Trustees** 

The Trustees are appointed by the Court of the Merchant Taylors’ Company, with regard paid to the particular skills and expertise that the Charity has need of at the relevant time. 

## **Induction and training of Trustees** 

Trustees are offered at least one opportunity each year to receive training from the Charity’s legal 

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ and accountancy advisers, either on a dedicated training day or by joining sessions offered generally by those advisers to their clients. The latter have tended to be favoured, in recent years, as they offer a range of different perspectives on the matters in question and the opportunity to share insights and establish useful contacts in the wider sector. 

Trustees have access to the governing documents; previous minutes, plans, and other documentation; and to Charity Commission guidance. They are also supported by a well-qualified and experienced staff based at Merchant Taylors’ Hall. 

## **Management personnel** 

The Trust does not employ management personnel but receives the services of Bradestrete Services Limited, a subsidiary of the Merchant Taylors’ Company, to provide all administrative functions. 

## **Decision-making and delegation** 

The Trustees are drawn from members of the Merchant Taylors’ Company and selected for their particular skills. Decisions as to expenditure for agreed budget lines – such as day-to-day administrative costs and small (under £5,000) grants - may be delegated to the Chairman of Trustees or to MTC staff, but other expenditure will usually be referred to all Trustees for approval. 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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## **REFERENCE AND ADMINISTRATIVE DETAILS** 

CHARITY NAME: Merchant Taylors’ Educational Trust REGISTERED CHARITY NUMBER: 310018 (registered with the Charity Commission for England and Wales) ADDRESS: 30 Threadneedle Street London EC2R 8JB TRUSTEES: Mr J A J Price (Chairman) Mr S W Bass _(appointed 14 July 2020)_ Lady Harding _(resigned 14 July 2020)_ Mr C P Hare Mr P T E Massey Mr P H Watkins CHIEF EXECUTIVE OFFICER: Rear Admiral J R H Clink CBE BANKERS: Royal Bank of Scotland plc 60-62 Threadneedle Street London EC2R 8LA INVESTMENT MANAGERS: Rathbone Investment Management Ltd 8 Finsbury Circus London EC2M 7AZ INDEPENDENT AUDITORS: Saffery Champness LLP 71 Queen Victoria Street London EC4V 4BE SOLICITORS: Charles Russell Speechlys LLP 5 Fleet Place London EC4M 7RD 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

Other entities whose results are consolidated in these statements are: 

## **MERCHANT TAYLORS’ SCHOOL** 

Registered Charity Number: 1063740 

Company Registration Number: 3411540 

Merchant Taylors’ School is a charitable Company Limited by Guarantee. Its Governors are appointed by the Trustees of the Merchant Taylors’ Educational Trust, although they act entirely independently and in accordance with their responsibilities as Trustees and Directors of the School. 

OFFICERS: The Headmaster: Mr S J Everson The Bursar: Mr I D Williams GOVERNORS: Mr C P Hare (Chairman) _(resigned 1 July 2020)_ Mr D G M Eggar (Chairman) _(appointed 1 July 2020)_ Mr R J Brooman Dr J M Cox Commodore A M Cree CBE Royal Navy _(appointed 1 July 2020)_ Mr G B M H du Parc Braham Mr A Eastwood Mr D Haria Mrs S A Morgan Mr A G Moss Mrs J Redman Mr D J Shah OBE FRSA Mr R-J Temmink _(resigned 1 July 2020)_ Sir M J Tomlinson Mr J D R Twining Ms L E Orr _(appointed 1 September 2020)_ 

## **MERCHANT TAYLORS’ SCHOOL ENTERPRISES LTD** 

Company Registration Number: 2275287 

100% of the issued share capital of Merchant Taylors’ School Enterprises Limited (MTSEL) is owned by Merchant Taylors’ School. 

DIRECTORS: Mr S J Everson Mr I D Williams Mr A G Moss 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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## **ST JOHN’S SCHOOL** 

Registered Charity Number: 1063738 

Company Registration Number: 3411518 

St John’s School is a charitable Company Limited by Guarantee. Its Governors are appointed by the Trustees of the Merchant Taylors’ Educational Trust, although they act entirely independently and in accordance with their responsibilities as Trustees and Directors of the School. 

OFFICERS: The Headmaster: Mr M S Robinson The Bursar & Secretary: Mr N E Stone GOVERNORS: Lady Harding (Chairman) Ms L Cavanagh Mr S J Everson Mrs E K Fenwick Mr J Fowler Mr P R Henson Mr P R MacDougall Mr M A L Robb Mr R A D Sullivan Mrs N J Walker 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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## **STATEMENT OF THE TRUSTEES’ RESPONSIBILITIES** 

The Trustees are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). 

The law applicable to charities in England and Wales requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Charity and the Group and of the incoming resources and application of resources of the Charity and the Group for that period. In preparing these financial statements, the Trustees are required to: 

- select suitable accounting policies and then apply them consistently; 

- observe the methods and principles in the Charities SORP (FRS102) Second Edition; 

- make judgements and estimates that are reasonable and prudent; 

- state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and 

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in business. 

The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Charity and enable them to ensure that the financial statements comply with the Charities Act 2011’s applicable accounting regulations. They are also responsible for safeguarding the assets of the Charity and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 

## **Statement as to disclosure of information to auditors** 

The Trustees who were in office on the date of approval of these financial statements have confirmed, as far as they are aware, that there is no relevant audit information of which the auditors are unaware. All of the Trustees have confirmed that they have taken all steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit information and to establish that it has been communicated to the auditor. 

## **Auditors** 

The Trustees have appointed Saffery Champness LLP, Chartered Accountants and Statutory Auditors, as auditors to the Charity. 

By order of the Trustees (If we type or otherwise electronically sign our names, we confirm that we intend to authenticate this document by so doing): 

John Aidan Joseph Price Peter Howard Watkins Date: 22 June 2021 Date: 22 June 2021 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

AUDITORS’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

## **Opinion** 

We have audited the financial statements of Merchant Taylors’ Educational Trust for the year ended 31 August 2020 which comprise the Consolidated Statement of Financial Activities, Consolidated Balance Sheet, Trust Balance Sheet, 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). 

In our opinion the financial statements: 

- give a true and fair view of the state of the group and parent charity’s affairs as at 31 August 2020 and of the group’s and the parent charity’s incoming resources and application of resources for the year then ended; 

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and 

- have been prepared in accordance with the requirements of the Charities Act 2011. 

## **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 Auditors’ responsibilities for the audit of the financial statements section of our report. We are independent of the group and the parent charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 

## **Conclusions relating to going concern** 

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: 

- the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or 

- the trustees have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the group’s or the parent charity’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue. 

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MERCHANT TAYLORS’ EDUCATIONAL TRUST 

AUDITORS’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

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## **Other information** 

The trustees are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditors’ report thereon. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. 

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. 

## **Matters on which we are required to report by exception** 

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

- the information given in the Trustees’ Annual Report is inconsistent in any material respect with the financial statements; or 

- the parent charity has not kept sufficient accounting records; or 

- the parent’s financial statements are not in agreement with the accounting records and returns; or 

- we have not received all the information and explanations we require for our audit. 

## **Responsibilities of trustees** 

As explained more fully in the Trustees’ Responsibilities Statement set out on page 13, the trustees 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 charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the group or the parent charity or to cease operations, or have no realistic alternative but to do so. 

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AUDITORS’ REPORT FOR THE YEAR ENDED 31 AUGUST 2020 

## **Auditors’ responsibilities for the audit of the financial statements** 

We have been appointed as auditors under the Charities Act 2011 and report in accordance with regulations made under that Act. 

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 auditors’ 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 auditors’ report. 

## **Use of our report** 

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


Saffery Champness LLP Chartered Accountants 71 Queen Victoria Street Statutory Auditors London EC4V 4BE 

Date: 28 June 2021 

Saffery Champness LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006 

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MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2020** 

|**Note**<br>**INCOME FROM**<br>**Charitable Activities**<br>School Fees<br>1<br>Registration/admissions fees<br>Other income - Insurance<br>Other income - Rent received<br>Other income - Trading<br>Other ancillary income<br>Government grant income<br>**Other trading activities**<br>2<br>**Investment income**<br>3a<br>**Donations and legacies**<br>Donations<br>3b<br>Development campaign income<br>**Total income**<br>**EXPENDITURE ON**<br>**Raising funds**<br>Publicity/advertising and development office<br>Trading & investment cost of sales<br>Financing<br>**Charitable Activities**<br>Schools and grantmaking<br>**Total expenditure**<br>4<br>**Net incoming resources before investments**<br>**Gains/(losses) on investment assets :**<br>Net gains and losses<br>**Net income**<br>Transfers between funds<br>6<br>**Net movement in funds**<br>Fund balances at 1 September 2019 as previously stated<br>Prior year adjustment<br>Restated opening balance<br>**Fund balances at 31 August 2020**|**Unrestricted**<br>**Restricted**<br>**Funds**<br>**Funds**<br>**£**<br>26,919,543<br>-<br>159,639<br>-<br>12,227<br>-<br>265,163<br>-<br>86,099<br>-<br>6,689<br>-<br>-<br>1,019,977<br>220,504<br>-<br>216,173<br>235,667<br>62,551<br>85,157<br>31,545<br>204,534<br>27,980,133<br>1,545,335<br>201,224<br>28,623<br>178,496<br>38,792<br>46,298<br>24,749<br>426,018<br>92,164<br>25,958,882<br>1,289,291<br>25,958,882<br>1,289,291<br>26,384,900<br>1,381,455<br>1,595,233<br>163,880<br>61,558<br>(27,245)<br>1,656,791<br>136,635<br>1,250<br>(1,250)<br>42,733,381<br>2,326,622<br>1,453,956<br>(190,863)<br>44,187,337<br>2,135,759<br>**2,271,144**<br>135,385<br>1,658,041<br>**45,845,378**|**Endowment**<br>**Funds**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>7,055<br>7,055<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>7,055<br>(93,089)<br>(86,034)<br>-<br>8,227,205<br>(1,263,093)<br>6,964,112<br>**6,878,078**<br>(86,034)|**Total**<br>**2020**<br>**£**<br>**26,919,543**<br>**159,639**<br>**12,227**<br>**265,163**<br>**86,099**<br>**6,689**<br>**1,019,977**<br>**220,504**<br>**451,840**<br>**147,708**<br>**243,134**<br>**29,532,523**<br>**229,847**<br>**217,288**<br>**71,047**<br>**518,182**<br>**27,248,173**<br>**27,248,173**<br>**27,766,355**<br>**1,766,168**<br>**(58,776)**<br>**1,707,392**<br>**-**<br>**53,287,208**<br>**-**<br>**53,287,208**<br>**54,994,600**<br>**1,707,392**|**Total**<br>**2019**<br>**£**<br>27,978,395<br>181,838<br>36,167<br>253,834<br>147,302<br>800<br>-<br>311,026<br>583,187<br>138,282<br>239,480|
|---|---|---|---|---|
|||||29,870,311|
|||||233,796<br>193,385<br>102,470|
|||||529,651<br>27,586,437|
|||||27,586,437|
|||||28,116,088|
|||||1,754,223<br>(18,120)|
|||||1,736,103|
|||||-|
|||||51,551,105<br>-<br>1,736,103|
|||||51,551,105|
|||||53,287,208|



The Trust's incoming resources and expenses all relate to continuing operations. The notes on pages 21 to 42 form part of these financial statements. 

17 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **CONSOLIDATED BALANCE SHEET AS AT 31 AUGUST 2020** 

|**Note**<br>**Fixed assets**<br>Tangible assets<br>7<br>Investments<br>9<br>**Current assets**<br>Stock<br>Debtors<br>11<br>Cash<br>within one year<br>**Net current assets**<br>**Total assets less current liabilities**<br>Creditors: amounts falling due after<br>more than one year<br>13<br>**Total net assets**<br>**Funds**<br>Endowment Funds<br>15<br>Restricted Funds<br>16<br>Unrestricted Funds<br>17<br>Creditors: amounts falling due<br>12|**£**<br>**£**<br>37,534,442<br> <br>15,318,449<br>52,852,891<br>57,953<br> <br>480,690<br>7,736,426<br>3,097,662<br>955,953<br>54,994,600<br>6,878,078<br>2,271,144<br>45,845,378<br>54,994,600<br>55,950,553<br>8,275,069<br>5,177,407<br>**2020**|**£**<br>**£**<br>34,341,895<br>17,330,557<br>51,672,452<br>49,736<br>495,986<br>7,701,854<br>2,789,626<br>1,174,870<br>53,287,208<br>6,964,112<br>2,135,759<br>44,187,337<br>53,287,208<br>54,462,078<br>8,247,576<br>5,457,950<br>**2019 (restated)**|**£**<br>**£**<br>34,341,895<br>17,330,557<br>51,672,452<br>49,736<br>495,986<br>7,701,854<br>2,789,626<br>1,174,870<br>53,287,208<br>6,964,112<br>2,135,759<br>44,187,337<br>53,287,208<br>54,462,078<br>8,247,576<br>5,457,950<br>**2019 (restated)**|
|---|---|---|---|
||||51,672,452<br>2,789,626|
||||1,174,870<br>54,462,078|
||||53,287,208|
||||6,964,112<br>2,135,759<br>44,187,337|
||||53,287,208|



These financial statements were approved by the Trustees on 22 June 2021 

(If we type or otherwise electronically sign our names, we confirm that we intend to authenticate this document by so doing) 

John Aidan Joseph Price Peter Howard Watkins 

Trustee Trustee 

The notes on pages 21 to 42 form part of these financial statements. 

18 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **TRUST BALANCE SHEET FOR THE YEAR ENDED 31 AUGUST 2020** 


**----- Start of picture text -----**<br>
Note 2020 2019 (restated)<br>£ £ £ £<br>Fixed assets<br>Investments 9 7,280,803 7,531,543<br>Current assets<br>Debtors 11 48,739 53,535<br>Cash  799,174 780,237<br>847,913 833,772<br>Creditors: amounts falling due<br>12 22,879 224,365<br>within one year<br>Net current assets 825,034 609,407<br>Total assets less current liabilities 8,105,837 8,140,950<br>Total net assets 8,105,837 8,140,950<br>Funds<br>Endowment Funds 15 5,182,083 5,315,425<br>Restricted Funds 16 1,466,585 1,371,559<br>Unrestricted Funds 17 1,457,169 1,453,966<br>8,105,837 8,140,950<br>**----- End of picture text -----**<br>


These financial statements were approved by the Trustees on 22 June 2021 

(If we type or otherwise electronically sign our names, we confirm that we intend to authenticate this document by so doing) 

John Aidan Joseph Price Peter Howard Watkins Trustee Trustee 

The notes on pages 21 to 42 form part of these financial statements. 

19 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 AUGUST 2020** 

|**Note**<br>**Net cash inflow from operating activities**<br>18<br>**Cash flows from investing activites**<br>Investment income<br>Bank and other interest<br>Purchase of tangible fixed assets<br>Proceeds on disposal of tangible fixed assets<br>Investment purchases at cost<br>Proceeds on disposal of investments<br>_Net cash (used in) investing activities_<br>**Cash flows from financing activities**<br>Receipt of endowment income<br>Movement on final deposits<br>Bank loans repaid<br>_Net cash (used in) financing activities_<br>**Change in cash and cash equivalents in the period**<br>**Cash and cash equivalents at the start of the period**<br>**Cash and cash equivalents at the end of the period**<br>19|**£**<br>**£**<br>**£**<br>**£**<br>2,890,061<br> <br>3,799,367<br>451,840<br>583,187<br>10,344<br>16,855<br>(5,054,238)<br>(2,683,577)<br>-<br>800<br>(3,321,375)<br>(2,248,815)<br>3,841,444<br>3,384,297<br>7,055<br>-<br>(121,956)<br>(109,011)<br>(96,961)<br>(120,000)<br>10,227,660<br>7,604,557<br>8,833,874<br>10,227,660<br>2,623,103<br>(1,393,786)<br>(211,862)<br>(229,011)<br>**2020**<br>**2019 (restated)**<br>(4,071,985)<br>(947,253)|
|---|---|



The notes on pages 21 to 42 form part of these financial statements. 

20 



MERCHANT TAYLORS’ EDUCATIONAL TRUST 

ACCOUNTING POLICIES FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

## **A. Accounting policies** 

The financial statements have been prepared in accordance with the Statement of Recommended Practice “Accounting and Reporting by Charities” (SORP) and Financial Reporting Standard 102 (FRS 102) and applicable law. The particular policies adopted by the Trustees are described below. 

## **B. Basis of accounting** 

The financial statements have been prepared under the historical cost convention with the exception of freehold investment property which is stated at valuation and other fixed asset investments which are stated at market value. The Charity is a public benefit entity. The financial statements have been prepared in sterling, rounded to the nearest £, which is the functional currency of the Charity. The Trustees are satisfied that the Charity is a going concern and have prepared these financial statements on that basis. The financial statements have been prepared to give a true and fair view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a true and fair view. This departure has involved following the SORP rather than the Accounting and Reporting by Charities: Statement of Recommended Practice (revised 2005) which has been withdrawn. 

## **C. Basis of consolidation** 

The consolidated financial statements comprise the following entities which are under the direct control of the Trustees of the Charity: Merchant Taylors’ School and its wholly owned subsidiary Merchant Taylors’ School Enterprises Limited and St. John’s School, Northwood. 

## **D. Leasehold land, buildings and other fixed assets** 

Freehold land and buildings occupied by the Charity’s subsidiaries are neither owned by the Charity nor by those subsidiaries, but are leased from the Merchant Taylors’ Company. The subsidiaries are responsible for putting and keeping the properties in repair and associated costs are written off as and when incurred. The cost of any material tenant’s improvement is capitalised on completion. 

Rentals payable are charged on a time basis over the lease term. The Statement of Financial Activities includes the net gains and losses arising on revaluation and disposals throughout the year. 

Depreciation is charged as follows: 

Merchant Taylors’ School Buildings and leasehold improvements: 70% charged over 50 years, 30% charged over 20 years in order to reflect components such as flat roofs and utilities installations which have a shorter life 

St John’s School Buildings and leasehold improvements: charged over 20 years 

Furniture and equipment: charged over 10 years 

Machinery and motor vehicles: charged over 4 years 

21 



MERCHANT TAYLORS’ EDUCATIONAL TRUST 

ACCOUNTING POLICIES FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

Computer hardware: charged over 4 years 

The Charity itself holds no fixed assets which are subject to depreciation. 

## **E . Current assets** 

Stock is carried at the lower of cost and net realisable value. 

## **F . Investments and investment income** 

Investment income from dividends, bank balances and fixed interest securities is accounted for when received. 

Listed investments are valued at mid-market value as at the balance sheet date. Unrealised gains and losses arising on the revaluation of investments are credited or charged to the Statement of Financial Activities and are allocated to the appropriate Fund according to the “ownership” of the underlying assets. 

## **G. Income** 

Donations and legacies are accounted for by all entities when they are entitled to the income and when the amount concerned can be quantified with sufficient certainty. Amounts received for general purposes are credited to the unrestricted funds of the receiving entity, whilst amounts subject to specific wishes or stipulations are credited to the appropriate restricted or endowment fund. 

Fees receivable and charges for services and use of the premises, less any allowances, scholarships, bursaries granted by the Merchant Taylors’ Company against those fees, but including contributions received from restricted funds, are accounted for in the period in which the service is provided. 

## **H. Direct charitable expenditure** 

Direct charitable expenditure includes all expenditure directly related to the objects of the Charity. All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to the category. Expenditure is allocated to expense headings either on a direct cost basis, or apportioned according to management estimates of time spent or space occupied, as appropriate. Governance costs, included within Support costs of schooling, comprise external audit costs and costs incurred in relation to constitutional and statutory requirements. 

Grants payable are charged in the year in which the offer is conveyed to the recipient. 

## **I. Funds** 

Notes 15 to 17 list all funds, which are categorised as follows: 

Endowment funds: These have the principal purpose of generating income. 

Restricted funds: These funds were donated or created for specific purposes and may be used only for those purposes. 

22 



MERCHANT TAYLORS’ EDUCATIONAL TRUST 

ACCOUNTING POLICIES FOR THE YEAR ENDED 31 AUGUST 2020 

___________________________________________________________________________________________________ 

Unrestricted funds: These are held for more general donations by the charity and by the school for the principal purposes of financing fixed assets and providing working capital for the MTET Schools. 

## **J. Pensions** 

Pension costs have been calculated by those subsidiaries which carry them, in accordance with FRS102. 

## **K. Taxation** 

The Charity and its subsidiaries are all registered charities and recognised as charitable by HMRC, and their income is not therefore liable to taxation as it is applied to wholly charitable purposes. 

## **L. Financial instruments** 

The Charity has financial assets and financial liabilities only of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method. 

## **M. Critical accounting judgement and estimates** 

The preparation of the financial statements in accordance with FRS102 requires the Trustees to make estimates and assumptions concerning the future. The estimates and assumptions that could have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year include accruals, depreciation and revenue recognition. The accounting in these areas of the accounts requires management to use judgement. In relation to accruals this is with regards to a best estimate of costs that will be incurred based on contractual requirements. For depreciation these estimates are driven by the useful economic life of the associated assets. For revenue recognition management apply judgements in concluding on the point at which revenue should be recognised. 

23 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 1 **Fees receivable** 

|Fees receivable consist of :<br>Gross fees<br>Less :<br>Discounts in Summer Term<br>Total bursaries, grants and allowances<br>Paid from restricted funds|**2020**<br>**2019**<br>**£**<br>**£**<br>30,512,796<br>29,307,622<br>(1,928,091)<br>-<br>(1,918,183)<br>(1,711,319)<br>26,666,522<br>27,596,303<br>253,021<br> <br>382,092<br>26,919,543<br>27,978,395|
|---|---|



Discounts were given in the summer term due to the disruption arising from the Covid-19 pandemic. 

## 2 **Trading income** 

Merchant Taylors School Enterprises Limited (MTSEL) operates the trading activities relating to Merchant Taylors' School including shops and letting of school facilities. It pays its taxable profits to the school by way of gift aid. Its trading results, extracted from its audited accounts were : 

|Turnover<br>Cost of sales<br>**Gross profit**<br>Administration costs<br>Interest receivable<br>**Net profit**<br>Gift aid transferred to Merchant Taylors' School<br>3<br>**Income**<br>3a<br>**Investment income**<br>Income generated by Trust investments<br>Income generated by investments held by subsidiaries<br>3b<br>**Donations**<br>Other donations received<br>4<br>**Expenditure**<br>Other expenditure includes :<br>Auditors' remuneration - audit and other services<br>Auditors’ remuneration for other services|**2020**<br>**£**<br>220,504<br>(48,998)<br>171,506<br>(114,680)<br>-<br>56,826<br>(56,826)<br>**2020**<br>**£**<br>234,296<br>217,544<br>451,840<br>147,708<br>147,708<br>**2020**<br>**£**<br>42,200<br>3,942|**2019**<br>**£**<br>311,026<br>(71,414)|
|---|---|---|
|||239,612<br>(121,971)<br>231|
|||117,872<br>(117,872)|
|||**2019**<br>**£**<br>322,820<br>260,367|
|||583,187|
|||138,282|
|||138,282|
|||**2019**<br>**£**<br>40,600<br>3,980|



24 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

|4<br>**Expenditure (continued)**<br>Staff costs :<br>Wages and salaries<br>Social security costs<br>Pension contributions<br>Termination costs|**2020**<br>**£**<br>14,903,017<br>1,533,187<br>2,825,230<br>28,333<br>19,289,767<br>|**2019**<br>**£**<br>14,657,086<br>1,502,893<br>2,083,724<br> <br>8,318<br>|
|---|---|---|
|||18,252,021|



The number of employees whose remuneration was between the following bands is as follows : 

||**2020**|**2019**|
|---|---|---|
|£60,001 - £70,000|38|39|
|£70,001 - £80,000|10|5|
|£80,001 - £90,000|5|7|
|£110,001 - £120,000|-|2|
|£120,001 - £130,000|3|1|
|£130,001 - £140,000|-|1|
|£180,001 - £190,000|-|1|
|£190,001 - £200,000|1|-|



Key management personnel of the Schools comprise the Head teachers, the Bursars and the senior leadership teams. The total combined contractual benefits totalled £2,266,942 (2019: £2,107,116). 

The average number of employees in the year was 434 (2019: 436) 

- 4b **Analysis of total resources expended** 

|**Cost of generating funds**<br>Trading & investment costs<br>Financing<br>**Charitable activities**<br>Teaching costs<br>Welfare<br>Premises<br>Support costs<br>Schools' operating cost<br>Bursaries paid for by restricted funds<br>Depreciation on OMT sports facility<br>Grants<br>Other costs<br>Governance costs<br>**Total resources expended**<br>Publicity/advertising and development office|**Staff costs**<br>**£**<br>183,412<br>68,191<br>-<br>251,603<br>15,289,201<br>821,793<br>1,368,365<br>1,558,805<br>19,038,164<br>-<br>-<br>-<br>-<br>-<br>19,289,767<br>|**Other**<br>**£**<br>46,435<br>149,097<br>71,047<br>266,579<br>1,451,482<br>423,878<br>3,185,762<br>962,763<br>6,023,885<br>253,021<br>-<br>33,268<br>22,708<br>15,436<br>6,614,897|**Depreciation**<br>**£**<br>-<br>-<br>-<br>-<br> <br>-<br>-<br>943,884<br>727,922<br>1,671,806<br>-<br>189,885<br>-<br>-<br>-<br>1,861,691|**Total**<br>**2020**<br>**£**<br>229,847<br>217,288<br>71,047<br>518,182<br>16,740,683<br>1,245,671<br>5,498,011<br>3,249,490<br>26,733,855<br>253,021<br>189,885<br>33,268<br>22,708<br>15,436<br>27,766,355|**Total**<br>**2019**<br>**£**<br>233,796<br>254,093<br>41,762|
|---|---|---|---|---|---|
||||||529,651<br>16,322,042<br>1,376,630<br>5,415,797<br>3,686,716|
||||||26,801,185<br>382,092<br>189,885<br>172,282<br>31,123<br>9,870|
||||||28,116,088|



25 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## **5 Subsidiary Entities** 

The results of the Fund's wholly owned subsidiary entities are included within the Consolidated Statement of Financial Activities as follows: 

|**Income from Charitable**<br>**Activities**<br>School Fees<br>Registration/admission fees<br>Other income<br>- Insurance<br>- Rent received<br>- Trading<br>- Other<br>- Government grant<br>**Income Resources from**<br>**Generated Funds**<br>Trading company income<br>Investment income<br>Donations<br>Development campaign<br>income<br>**Cost of generating funds**<br>Financing<br>**Charitable Activities**<br>Schools and grantmaking<br>Fund balances at 31 August<br>2020<br>Fund balances at 1<br>September 2019<br>**Per statement of financial**<br>**activities**<br>Trading & investment cost of<br>sales<br>Net gains on investment<br>assets<br>Publicity/advertising and<br>development office|**Merchant**<br>**Taylors'**<br>**School**<br>**Merchant**<br>**Taylors'**<br>**School**<br>**Merchant**<br>**Taylors'**<br>**School**<br>**Enterprises**<br>**Limited**<br>**Merchant**<br>**Taylors'**<br>**School**<br>**Enterprises**<br>**Limited**<br>**St John's**<br>**School,**<br>**Northwood**<br>**St John's**<br>**School,**<br>**Northwood**<br>**2020**<br>**2019**<br>**2020**<br>**2019**<br>**2020**<br>**2019**<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>22,136,119<br>22,966,340<br>-<br>-<br>4,783,424<br>5,012,056<br>138,571<br>154,223<br>-<br>-<br>21,068<br>27,615<br>-<br>12,227<br>36,167<br>-<br>-<br>-<br>244,388<br>237,686<br>-<br>-<br>20,775<br>16,148<br>86,099<br>137,539<br>-<br>-<br>-<br>9,763<br>-<br>800<br>-<br>-<br>6,689<br>-<br>909,909<br>-<br>-<br>-<br>110,068<br>-<br>-<br>220,504<br>311,026<br>-<br>-<br>130,683<br>132,735<br>-<br>231<br>86,861<br>127,401<br>141,983<br>430,535<br>-<br>-<br>22,589<br>21,620<br>243,134<br>209,595<br>-<br>-<br>-<br>-|
|---|---|
||24,043,113<br>24,305,620<br>220,504<br>311,257<br>5,051,474<br>5,214,603|
||229,847<br>233,796<br>-<br>-<br>-<br>-<br>14,850<br>14,367<br>220,504<br>311,257<br>-<br>16,173<br>26,820<br>39,024<br>-<br>-<br>14,595<br>2,738<br>22,221,677<br>22,484,500<br>-<br>-<br>4,977,792<br>4,888,662|
||22,493,194<br>22,771,687<br>220,504<br>311,257<br>4,992,387<br>4,907,573<br>198,205<br>40,226<br>-<br>-<br>12,951<br>(64,707)|
||1,748,124<br>1,574,159<br>-<br>-<br>(5,620)<br>319,981|
||37,797,209<br>36,223,050<br>1<br>1<br>7,349,049<br>7,029,068|
||**39,545,333**<br>**37,797,209**<br>**1**<br>**1**<br>**7,343,429**<br>**7,349,049**|




**Merchant Taylors' School - Charity Number 1063740** 

**Merchant Taylors' School Enterprises Limited - Company Number 02275287** 

**St John's School, Northwood - Charity Number 1063738** 

26 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 6 **Transfers between funds** 

|**Merchant Taylors' School**<br>Housing fund<br>Designated bursary fund<br>**St John's School**<br>Depreciation on gifted assets|**Unrestricted**<br>**Schools**<br>**£**<br>15,417<br>153<br>1,250<br>16,820|**Unrestricted**<br>**Other**<br>**£**<br>(15,417)<br>(153)<br>-<br>(15,570)|**Restricted**<br>**funds**<br>**£**<br>-<br>(1,250)<br>(1,250)|**Endowment**<br>**funds**<br>**Total**<br>**£**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-|
|---|---|---|---|---|



An amount equivalent to the depreciation charge on assets donated to Merchant Taylors' School and St John's School has been transferred to the unrestricted fund. 

- 7 **Tangible fixed assets** 

|Group only<br>**Cost**<br>1 September 2019<br>Additions<br>Disposals<br>Transfers<br>**31 August 2020**<br>**Depreciation**<br>1 September 2019<br>Charge for year<br>On disposals<br>**31 August 2020**<br>**Net book value**<br>**31 August 2020**<br>**31 August 2019**|**Equipment,**<br>**machinery**<br>**& vehicles**<br>**£**<br>9,843,046<br>212,827<br>-<br>-<br>10,055,873<br>6,612,599<br>727,922<br>-<br>7,340,521<br>2,715,352<br>3,230,447<br>|**Land, buildings**<br>**and tenants**<br>**improvements**<br>**£**<br>46,113,523<br>805,509<br>-<br>-<br>46,919,032<br>15,553,672<br>1,133,769<br>-<br>16,687,441<br>30,231,591<br>30,559,851|**Assets under**<br>**Construction**<br>**£**<br>551,597<br>4,035,902<br>-<br>-<br>4,587,499<br>-<br>-<br>-<br>-<br>4,587,499<br>551,597|**Total**<br>**2020**<br>**£**<br>56,508,166<br>5,054,238<br>-<br>-<br>61,562,404<br>22,166,271<br>1,861,691<br>-<br>24,027,962<br>37,534,442<br>34,341,895|**Total**<br>**2019**<br>**£**<br>53,918,476<br>2,681,977<br>(92,287)<br>-|
|---|---|---|---|---|---|
||||||56,508,166|
||||||20,374,629<br>1,852,009<br>(60,367)|
||||||22,166,271|
|||||||



Merchant Taylors' Company own the land and buildings from which Merchant Taylors' School and St John's School operate. Merchant 

Taylors' School currently has a 125 year lease which expires in 2139 and St John's School has a 14 year lease which expires in 2023. 

27 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 8 **Fixed assets investments - group undertakings** 

The subsidiary undertakings of the Trust are as follows : 

|The subsidiary undertakings of|the Trust are as follows|:|||||
|---|---|---|---|---|---|---|
||||||**% of**||
||**Country of**|**Nature of**|**Amount of**|**Class of**|**shares**|**Nature of**|
|**Name**|**incorporation**|**control**|**guarantee**|**shares**|**held**|**business**|
|Merchant|||||||
|Taylors' School|England|Guarantor|£1 per Trustee|-|-<br>|School|
|St John's School|||||||
|Northwood|England|Guarantor|£1 per Trustee|-|-<br>|School|
|Merchant Taylors'|||||||
|School Enterprises Ltd|England|Owner|-|Ordinary|100%|Trading|



## 9 **Fixed asset investments - group and trust** 

|Listed investments:<br>Market value at 1 September 2019<br>Additions at cost<br>Disposals<br>Unrealised (losses)/gains<br>**Market value at 31 August 2020**<br>Cash held as part of portfolio|**Trust**<br>**St John's**<br>**Merchant**<br>**Total**<br>**Total**<br>**funds**<br>**School**<br>**Taylors' School**<br>**2020**<br>**2019**<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>7,182,496<br>2,768,670<br>4,853,585<br>14,804,751<br>15,853,099<br>1,108,035<br>191,430<br>2,021,910<br>3,321,375<br>2,248,815<br>(900,037)<br>(1,174,222)<br>(1,767,185)<br>(3,841,444)<br>(3,434,469)<br>(277,569)<br>(63,047)<br>276,935<br>(63,681)<br>137,306<br>7,112,925<br>1,722,831<br>5,385,245<br>14,221,001<br>14,804,751<br>167,878<br>252,105<br>677,465<br>1,097,448<br>2,525,806<br>7,280,803<br>1,974,936<br>6,062,710<br>15,318,449<br>17,330,557|
|---|---|



## 10 **Financial instruments** 

**Consolidated Trust 2020 2019 2020 2019 £ £ £ £ Carrying amount of financial assets** Debt instruments measured at amortised cost 336,686 235,091 47,475 52,413 **Carrying amount of financial liabilities** Measured at amortised cost 3,169,305 3,015,462 13,933 224,365 

28 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 11 **Debtors** 

|Fees<br>Sundry debtors<br>Amounts due from related parties<br>Prepayments<br>**rs: amounts falling due within one year**<br>Bank loans and overdraft<br>Final term deposits<br>Trade creditors<br>Exam deposits and Autumn term pre-payments<br>Amounts owed to related parties<br>Other creditors and accruals<br>Fees in advance scheme|**2020**<br>**2019**<br>**£**<br>**£**<br>22,093<br>46,959<br>314,593<br>188,132<br>860<br>11,636<br>143,144<br>249,259<br>480,690<br>495,986<br>**2020**<br>**2019**<br>**£**<br>**£**<br>529,725<br>513,368<br>88,300<br>77,200<br>87,052<br>438,735<br>1,859,505<br>2,002,529<br>14,426<br>11,877<br>2,464,228<br>1,889,198<br>134,171<br>525,043<br>5,177,407<br>5,457,950<br>**Consolidated**<br>**Consolidated**|**2020**<br>**2019**<br>**£**<br>**£**<br>-<br>-<br>47,475<br>52,413<br>860<br>828<br>404<br>294<br>48,739<br> <br>53,535<br>**2020**<br>**2019**<br>**£**<br>**£**<br>-<br>-<br>-<br>-<br>8,946<br>-<br>-<br>-<br>-<br>224,365<br>13,933<br>-<br>-<br>-<br>22,879<br>224,365<br>**Trust**<br>**Trust**|
|---|---|---|



## 12 **Creditors: amounts falling due within one year** 

Parents may enter into a contract to pay the Senior School in advance for fixed contributions towards the tuition fees for up to 7 years. The money may be returned subject to specific conditions on the receipt of notice. 

## 13 **Creditors: amounts falling due after more than one year** 

|Final term deposits & fees in advance:<br>Within 1 to 2 years<br>Within 2 to 5 years<br>After 5 years<br>Bank loans:<br>Within 1 to 2 years<br>Within 2 to 5 years<br>After 5 years<br>**Total creditors due after more than one year**|**2020**<br>**2019**<br>**£**<br>**£**<br>230,527<br>214,102<br>337,026<br>792,622<br>388,400<br>71,185<br>955,953<br>1,077,909<br>-<br>49,356<br>-<br>47,605<br>-<br>-<br>-<br>96,961<br>**955,953**<br>**1,174,870**<br>**Consolidated**|**2020**<br>**2019**<br>**£**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>**-**<br>**-**<br>**Trust**|**2020**<br>**2019**<br>**£**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>**-**<br>**-**<br>**Trust**|
|---|---|---|---|
||||-|
||||-<br>-<br>-|
||||-|
||||**-**|



Bank loans and overdrafts included in notes 12 and 13 totalling £529,725 are subject to a negative pledge relating to the property at Merchant Taylors' Preparatory School, Moor Farm, Sandy Lodge Road, Rickmansworth, Hertfordshire. This site is included within the fixed asset note under leasehold and buildings. 

At the start of the year there was a balance of £476,181 on the fees in advance scheme, there were new contracts and discounts totalling £5,139 and £170,296 was utilised in the year, resulting in a balance at year-end of £311,024. 

29 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 14 **Allocation of the net assets of the charity** 

|**Fixed assets**<br>**and investments**<br>**£**<br>Group<br>Unrestricted funds<br>45,072,939<br>Restricted funds<br>901,874<br>Endowment funds<br>6,878,078<br>52,852,891<br> <br>Trust only<br>Unrestricted funds<br>1,321,202<br>Restricted funds<br>777,518<br>Endowment funds<br>5,182,083<br>7,280,803|**Net**<br>**Current**<br>**assets**<br>**£**<br>1,728,392<br>1,369,270<br>-<br>3,097,662<br> <br>135,967<br>689,067<br>-<br>825,034<br>|**Long**<br>**term**<br>**liabilities**<br>**£**<br>(955,953)<br>-<br>-<br>(955,953)<br>-<br>-<br>-<br>-|**Total**<br>**2020**<br>**£**<br>45,845,378<br>2,271,144<br>6,878,078|
|---|---|---|---|
||||54,994,600|
||||1,457,169<br>1,466,585<br>5,182,083|
||||8,105,837|



30 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 15 **Endowment Funds** 

## **Consolidated** 

|Original Endowment Fund<br>Foundation Capital<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>Expendable Endowment<br>Development Fund<br>**Trust**<br>Original Endowment Fund<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>Merchant Taylors' School Bursary<br>and Scholarship Trust<br>Merchant Taylors' School Bursary<br>and Scholarship Trust|**Original**<br>**Balance**<br>**1.9.19**<br>1,263,093<br>5<br>48,931<br>134,721<br>421,196<br>290,122<br>451,461<br>1,197,221<br>8,227,205<br>1,263,103<br>48,931<br>134,721<br>421,196<br>290,122<br>6,578,528<br> <br> <br>4,420,455<br>4,420,455|**Fund**<br>**adjustment**<br>**£**<br>(1,263,093)<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>(1,263,093)<br>(1,263,103)<br>-<br>-<br>-<br>-<br>(1,263,103)<br>-<br>-|**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>-<br>5<br>48,931<br>134,721<br>421,196<br>290,122<br>451,461<br>1,197,221<br>6,964,112<br>**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>**-**<br>48,931<br>134,721<br>421,196<br>290,122<br>5,315,425<br>4,420,455<br>4,420,455|**Incoming**<br>**resources**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>7,055<br>7,055<br>**Incoming**<br>**resources**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-|**Resources**<br>**expended**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>**Resources**<br>**expended**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-|**Transfers**<br>**(note 6)**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>**Transfers**<br>**(note 6)**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-|**Investment**<br>**Balance**<br>**gains/(losses)**<br>**31.8.20**<br>**£**<br>**£**<br>-<br>-<br>-<br>5<br>(1,231)<br>47,700<br>(3,384)<br>131,337<br>(10,575)<br>410,621<br>(7,249)<br>282,873<br>18,972<br>470,433<br>21,281<br>1,225,557<br>4,309,552<br>(110,903)|
|---|---|---|---|---|---|---|---|
||||||||(93,089)<br>6,878,078|
||||||||**Investment**<br>**Balance**<br>**gains/(losses)**<br>**31.8.20**<br>**£**<br>**£**<br>-<br>-<br>(1,231)<br>47,700<br>(3,384)<br>131,337<br>(10,575)<br>410,621<br>(7,249)<br>282,873<br>4,309,552<br>(110,903)|
||||||||(133,342)<br>5,182,083|



## **Prior Year Adjustment** 

In the prior year the "Original Endowment Fund" was incorrectly classified as an endowment fund and restricted income fund (note 16), this has been reclassified to unrestricted funds (see note 17). Endowments were overstated in 2019 therefore to the value of £1,263,103 (2018: £1,269,928) and restricted funds by £190,863 (2018: £179,389). The general funds in unrestricted income has been restated to include both these totals, thereby increasing the value of unrestricted funds by £1,453,966. The reclassification has had no impact on overall results or net assets. 

## **Fund Details** 

The Foundation Capital represents the original endowment of the MTET. 

The Merchant Taylors' School Bursary and Scholarship Trust was created on 14 July 1998 and exists as a restricted fund within MTET. Income accruing to the Merchant Taylors' School Bursary and Scholarship Trust can be used solely for the provision of bursaries or scholarships for the benefit of pupils of Merchant Taylors' School. 

The Lort-Williams' Fund was created from a legacy from Lady Lort-Williams for the provision of bursaries or scholarships for the benefit of pupils of Merchant Taylors' School. 

Sir Christopher Harding's Fund was created from a legacy from Sir Christopher Harding for the provision of scholarships for the benefit of pupils of Merchant Taylors' School. 

Lord Hailey's Fund was created from a legacy from Miss A I Wright for the provision of bursaries or scholarships for the benefit of pupils of Merchant Taylors' School. 

The Development Fund was initiated in 2009 when Merchant Taylors' School launched its "Forward To Our Roots" initiative. The income from the Fund is to be used to fund bursaries. The expendable endowment also allows the funding of bursaries. 

31 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 16 **Restricted Funds** 

|**Consolidated**<br>**St John's School**<br>Prepreparatory refurbishment<br>**Merchant Taylors' School**<br>General Donations<br>Development Fund<br>Sports, art and school campus<br>Capital projects<br>Government grant<br>**MTET**<br>MTET Restricted Fund<br>**Endowment income funds**<br>Original Endowment<br>Bursary and Scholarship Trust<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>**Trust**<br>MTET Restricted Fund<br>**Endowment income funds**<br>Bursary and Scholarship Trust<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>Original Endowment|**Original**<br>**Balance**<br>**1.9.19**<br>**£**<br>5,000<br>320,220<br>376,008<br>25,552<br>37,420<br>-<br>1,075,708<br>190,863<br>98,097<br>142<br>2,938<br>6,664<br>188,010<br>2,326,622<br>**Original**<br>**Balance**<br>**1.9.19**<br>**£**<br>1,075,708<br>98,097<br>142<br>2,938<br>6,664<br>188,010<br>190,863<br>1,562,422|**Fund**<br>**adjustment**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>(190,863)<br>-<br>-<br>-<br>-<br>(190,863)<br>**Fund**<br>**adjustment**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>(190,863)<br>(190,863)|**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>5,000<br>320,220<br>376,008<br>25,552<br>37,420<br>-<br>1,075,708<br>-<br>98,097<br>142<br>2,938<br>6,664<br>188,010<br>2,135,759<br>**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>1,075,708<br>98,097<br>142<br>2,938<br>6,664<br>188,010<br>-<br>1,371,559|**Incoming**<br>**resources**<br>**£**<br>-<br>85,157<br>217,435<br>8,901<br>18,181<br>1,019,977<br>33,200<br>-<br>135,142<br>1,499<br>4,124<br>12,886<br>8,833<br>1,545,335<br>**Incoming**<br>**resources**<br>**£**<br>33,200<br>135,142<br>1,499<br>4,124<br>12,886<br>8,833<br>-<br>195,684|**Resources**<br>**expended**<br>**£**<br>-<br>(113,103)<br>(159,769)<br>(15,192)<br>-<br>(1,019,977)<br>(11,879)<br>-<br>(48,652)<br>(537)<br>(1,475)<br>(4,611)<br>(6,260)<br>(1,381,455)<br>**Resources**<br>**expended**<br>**£**<br>(11,879)<br>(48,652)<br>(537)<br>(1,475)<br>(4,611)<br>(6,260)<br>-<br>(73,414)|**Investment**<br>**gains/losses**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>(27,245)<br>-<br>-<br>-<br>-<br>-<br>(27,245)<br>**Investment**<br>**gains/losses**<br>(27,245)<br>-<br>-<br>-<br>-<br>-<br>-<br>(27,245)|**Transfers**<br>**(note 6)**<br>**£**<br>(1,250)<br>-<br>-<br>-<br>-<br>-<br>41,498<br>(41,498)<br>-<br>-<br>-<br>-<br>(1,250)<br>**Transfers**<br>**(note 6)**<br>**£**<br>41,498<br>(41,498)<br>-<br>-<br>-<br>-<br>-<br>-|**Balance**<br>**31.8.20**<br>**£**<br>3,750<br>292,274<br>433,674<br>19,261<br>55,601<br>-<br>1,111,282<br>143,089<br>1,105<br>5,586<br>14,940<br>190,583|
|---|---|---|---|---|---|---|---|---|
|||||||||2,271,144|
|||||||||**Balance**<br>**31.8.20**<br>**£**<br>1,111,282<br>143,089<br>1,105<br>5,586<br>14,940<br>190,583<br>-|
|||||||||1,466,584|



Income accruing to the Endowment Funds is restricted to the purposes described in note 15. The MTET Restricted fund was formed on the transfer of the T3-5 Fund. See note 24 for further details. 

32 



_MERCHANT TAYLORS' EDUCATIONAL TRUST_ 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 17 **Unrestricted Funds** 

## **Consolidated** 

|General Reserve<br>Designated funds:<br>Designated Bursary Fund<br>Housing Fund<br>Pension Fund<br>OMT Asset Fund<br>Durrants' Fund<br>Fees in Advance<br>Trading Company<br>Total designated funds<br>Unrestricted funds<br>**Trust**<br>General reserve|**Original**<br>**Balance**<br>**1.9.19**<br>**£**<br>32,536,669<br>32,536,669<br>1,402,817<br>46,039<br>121,580<br>4,904,519<br>3,702,084<br>19,673<br>-<br>10,196,712<br>42,733,381<br>**Original**<br>**Balance**<br>**1.9.19**<br>**£**<br>-|**Fund**<br>**adjustment**<br>**£**<br>1,453,956<br>1,453,956<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>1,453,956<br>**Fund**<br>**adjustment**<br>**£**<br>1,453,966|**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>33,990,625<br>33,990,625<br>1,402,817<br>46,039<br>121,580<br>4,904,519<br>3,702,084<br>19,673<br>-<br>10,196,712<br>44,187,337<br>**Restated**<br>**Balance**<br>**1.9.19**<br>**£**<br>1,453,966|**Incoming**<br>**resources**<br>**£**<br>27,734,786<br>27,734,786<br>30,953<br>-<br>-<br>-<br>212,969<br>1,425<br>-<br>245,347<br>27,980,133<br>**Incoming**<br>**resources**<br>**£**<br>78,574|**Resources**<br>**expended**<br>**£**<br>(26,183,267)<br>(26,183,267)<br>(3,318)<br>-<br>-<br>(189,885)<br>(8,430)<br>-<br>-<br>(201,633)<br>(26,384,900)<br>**Resources**<br>**expended**<br>**£**<br>(43,684)|**Other gains/**<br>**(losses)**<br>**£**<br>71,782<br>71,782<br>(10,224)<br>-<br>-<br>-<br>-<br>-<br>-<br>(10,224)<br>61,558<br>**Other gains/**<br>**(losses)**<br>**£**<br>(31,687)|**Transfers**<br>**between**<br>**funds**<br>**(note 6)**<br>**£**<br>(14,014)<br>(14,014)<br>(153)<br>15,417<br>-<br>-<br>-<br>-<br>-<br>15,264<br>1,250<br>**Transfers**<br>**between**<br>**funds**<br>**(note 6)**<br>**£**<br>-|**Balance**<br>**31.8.20**<br>**£**<br>35,599,912|
|---|---|---|---|---|---|---|---|---|
|||||||||35,599,912<br>1,420,075<br>61,456<br>121,580<br>4,714,634<br>3,906,623<br>21,098<br>-|
|||||||||10,245,466|
|||||||||45,845,378|
|||||||||**Balance**<br>**31.8.20**<br>**£**<br>1,457,169|



The **Trust** holds £1,457,169 in unrestricted assets. This was misclassified in the prior year as an endowment fund and has been restated as detailed in note 15. 

The **General Reserve fund** is retained to finance the fixed assets and provide working capital for both Merchant Taylors' School and St John's School. 

The **Designated Bursary Fund** for Merchant Taylors' School had a balance of £603,671 at the year-end, whilst St John's School has a balance of £816,404 (2019: £601,577 and £801,240 respectively).  These funds are to provide bursary assistance to pupils. 

The **Housing Fund** was set up to grant interest-free loans to members of staff in School accommodation to assist in the purchase of their own property. The value of the fund us equal to the balance of loans currently outstanding. 

Historically the **Pension Fund** had been set up to cover Merchant Taylors School's share of the deficit in the Merchant Taylors' Company pension scheme.  However, in the past, the Trustees completed a buy out with Aviva Plc.  The School, subsequent to the buy out, entered into an agreement with the principal employer to indemnify the members against a loss not covered by the Pension Protection Fund, should Aviva not have sufficient assets to meet pension payments.  This fund will therefore be maintained in order to meet any contingent liability which may arise.  The Governors of the School believe the likelihood of such a liability to be minimal.  The total contingent liability cannot be quantified with any certainty at this time. 

The **OMT Asset Fund** - In 2004, the War Memorial Trustees of the Old Merchant Taylors' Society ("OMT") entered into an agreement with a developer to sell the existing OMT sports facility at Durrants and build a new OMT facility on the Merchant Taylors' School's grounds. Funds of £6.4m were received from the developer to fund this facility, which OMT occupies under a 125 year licence which it entered into in 2011. The expenditure equates to the depreciation charge and reconciles the fund balance to the current net book value of the OMT sports facility. 

The **Durrants Fund** - Due to the size and significance of the funds received from the sale of The War Memorial sports facility at Durrants (excluding that which was received to build a new 

OMT facility), the Trustees have agreed to create a designated fund for the purpose of maintaining the OMT sports facilities. 

The **Fees in Advance Fund** represents the net assets relating to the Fees in Advance Scheme and any surplus may be used to meet any of the School's charitable objectives. 

33 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 18 **Reconciliation of net incoming resources to net cash inflow from operating activities** 

|Net incoming resources<br>Investment Income<br>Bank and Other Interest<br>Loss/(gain) on investments<br>Depreciation<br>Receipt of endowment<br>Loss/(profit) on disposal of Fixed Assets<br>(Increase) in stocks<br>Decrease/(increase) in debtors<br>(Decrease)/increase in operating creditors<br>**Net cash inflow from operating activities**|**2020**<br>**£**<br>1,766,168<br>(451,840)<br>(10,344)<br>4,905<br>1,861,691<br>(7,055)<br>-<br>(8,217)<br>15,296<br>(280,543)<br>2,890,061|**2019**<br>**£**<br>1,754,223<br>(583,187)<br>(16,855)<br>(105,255)<br>1,852,009<br>-<br>32,721<br>(3,391)<br>(4,400)<br>873,502|
|---|---|---|
|||3,799,367|



## 19 **Net debt reconciliation** 

|**t reconciliation**||||
|---|---|---|---|
|Cash at hand and in bank<br>Cash within investment portfolio<br>Loans: falling due in less than one year<br>Loans: falling due in more than one year<br>**Total**|**At 1**<br>**September**<br>**2019**<br>**£**<br>7,701,854<br>2,525,806<br>10,227,660<br>(513,368)<br>(96,961)<br>9,617,331|**Cash flow &**<br>**other**<br>**movements**<br>**£**<br>34,572<br>(1,428,358)<br>(1,393,786)<br>(16,357)<br>96,961<br>(1,313,182)|**At 31**<br>**August 2020**<br>**£**<br>7,736,426<br>1,097,448|
||||8,833,874<br>(529,725)<br>-|
||||8,304,149|



## 20 **Pension commitments** 

The pension contribution charged to direct charitable expenditure for the year was £2,825,230 (2019: £2,092,370). 

## **Teaching staff** 

The Schools participate in the Department of Education Teachers' Pension Scheme (TPS) for their teaching staff. Employer's contributions throughout the year were 16.4% of pensionable salary. Contributions payable in the year totalled £2,266,566 (2019: £1,540,725). 

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 latest valuation of the Teachers’ Pension Scheme has now taken place, in line with directions issued by HM Treasury and using membership data as at 31 March 2016. As a result of this valuation, TPS employers will pay an increased contribution rate of 23.68% from September 2019 (this includes the administration levy of 0.8%). The timing of the implementation is to align its introduction with employers’ budget planning cycles. Until then, employers will pay the current rate of 16.48%. 

A copy of the latest valuation report can be found by following this link to the Teachers’ Pension Scheme website. 

There are also indications that the protections in the new cost cap mechanism required by the Public Service Pensions Act 2013 mean public sector workers will get improved pension benefits for employment over the period April 2019 to March 2023. Until the cost cap review has been completed it is not possible to determine any financial impact or future changes to the contribution rate of the TPS. Accordingly no provision for any increase to pension costs has been included in these accounts. 

34 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 20 **Pension commitments (continued)** 

## **Non-teaching staff** 

## **(a) The Merchant Taylors' Company and Pension Life Assurance Scheme** 

Merchant Taylors' School was a member of the Merchant Taylors' Company Pension Scheme for some senior non-teaching staff. This scheme was closed to further accrual on 30 April 2011.  However during that year the Trustees completed a buy-out of liabilities with Aviva Plc.  The School, subsequent to the buy out, entered into an agreement with the principal employer to indemnify the members against any loss not covered by the Pension Protection Fund, should Aviva not have sufficient assets to meet pension payments.  This Fund, as detailed in note 17, will therefore be maintained and added to in future years, in order to meet any contingent liability which may arise. The Governors believe the likelihood of such a liability arising to be minimal. The total contingent liability attributable to the School cannot be quantified with any certainty at this time. 

## **(b) Group Personal Pension Scheme** 

The Schools also contribute to group personal pension plans in respect of their staff. In total, the School's contributions to group personal pension schemes for the year amounted to £560,005 (2019: £551,654) 

## 21 **Other financial commitments** 

At 31 August 2020, the Grouip was committed to making the following annual payments under non-cancellable operating leases, the Trust itself had no annual payments due: 

|<br>elf had no annual payments due:|||
|---|---|---|
||**Land and**|**buildings**|
||**2020**|**2019**|
||**£**|**£**|
|In less than 1 year|354,679|354,679|
|Between 2 and 5 years|1,394,243|1,402,766|
|After 5 years|13,448,748<br>|14,964,940|



## 22 **Transactions with Trustees and School Governors** 

No trustees have received any remuneration during the year (2019: £nil) nor have they been reimbursed for expenses (2019: £nil). 

School governors are not remunerated (2019: £nil) and received reimbursement of expenses of £1,877 (2019: £3,907) 

## 23 **Related party transactions** 

- a) MTET appoints the Directors and Governors of the Schools, who thereafter are responsible for the control of the Companies. During the year covered by these financial statements, MTET granted £nil to Merchant Taylors School (2019: £196,000) 

- b) Merchant Taylors' School Enterprises Limited  (Company registration No. 2275287) 

The results of this Company for the year were satisfactory.  The profit donated to the School was £56,826 (2019: £117,872). 

- c) The Merchant Taylors' Company made a donation to Merchant Taylors' School of £39,350 (2019: £48,867). 

The Company made a donation to St John's which amounted to £22,590 (2019: £21,620). 

The Merchant Taylors' Company owns the land and buildings from which the School operates.  The School currently has a 128 year lease from 16 March 2011, at a current annual rent of £112,156 (2019: £112,156) to be subject to review. 

35 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 23 **Related party transactions (continued)** 

- d) Merchant Taylors' School and St John's School, Northwood are connected by common administration.  Some non-teaching staff of Merchant Taylors' School perform similar duties for St John's School.  A management fee for this service is charged to St John's, which amounted to £65,000 (2019: £65,000) for the year ended 31 August 2020. 

- f) The Merchant Taylors' Company owns the land and buildings from which St John's School operates. The school has a fourteen year lease at an annual rent of £234,000. 

## 24 **Capital commitments** 

Capital expenditure contracted for but not provided in the financial statements was £2.4million (2019: £3.3m) 

36 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

|25<br>**Comparative information**<br>**Restated Statement of Financial Activities**<br>**INCOME FROM**<br>**Charitable Activities**<br>School Fees<br>Registration/admissions fees<br>Other income - Insurance<br>Other income - Rent received<br>Other income - Trading<br>Other income - sale of fixed asset<br>**Other trading activities**<br>**Investment income**<br>**Donations and legacies**<br>Donations<br>Development campaign income<br>**Total income**<br>**EXPENDITURE ON**<br>**Raising funds**<br>Publicity/advertising and development office<br>Trading & investment cost of sales<br>Financing<br>**Charitable Activities**<br>Schools and grantmaking<br>**Total expenditure**<br>**Net incoming resources before investments**<br>Gains/(losses) on investment assets :<br>Net gains/(losses)<br>**Net income/expenditure**<br>Transfers between funds<br>**Net movement in funds**<br>Fund balances previously stated at 1 September 2018<br>Restatement<br>Fund balances restated at 1 September 2018<br>**Fund balances c/forward 31 August 2019**|**Restated**<br>**Unrestricted**<br>**funds**<br>**£**<br>27,978,395<br>181,838<br>36,167<br>253,834<br>147,302<br>800<br>311,026<br>224,112<br>-<br>71,870<br>91,671|**Restated**<br>**Restricted**<br>**funds**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>359,075<br>66,412<br>127,084|**Restated**<br>**Endowment**<br>**funds**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>20,725<br>20,725<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>20,725<br>(35,254)<br>(14,529)<br>-<br>8,248,559<br>(1,269,918)<br>6,978,641<br>**6,964,112**<br>(14,529)|**Restated**<br>**Total**<br>**2019**<br>**£**<br>**27,978,395**<br>**181,838**<br>**36,167**<br>**253,834**<br>**147,302**<br>**800**<br>**311,026**<br>**583,187**<br>**138,282**<br>**239,480**|
|---|---|---|---|---|
||29,297,015|552,571||**29,870,311**|
||146,944<br>193,385<br>66,853<br>407,182<br>27,032,798<br>27,032,798<br>27,439,980|86,852<br>-<br>35,617<br>122,469<br>553,639<br>553,639<br>676,108||**233,796**<br>**193,385**<br>**102,470**|
|||||**529,651**<br>**27,586,437**<br>**-**|
|||||**27,586,437**|
|||||**28,116,088**|
||1,857,035<br>27,234<br>1,884,269<br>1,250<br>40,852,511<br>1,449,307<br>42,301,818<br>**44,187,337**<br>1,885,519|(123,537)<br>(10,100)<br>(133,637)<br>(1,250)<br>2,450,035<br>(179,389)<br>2,270,646<br>**2,135,759**<br>(134,887)||**1,754,223**<br>**(18,120)**|
|||||1,736,103<br>**-**|
|||||**51,551,105**<br>**-**<br>51,551,105<br>1,736,103|
|||||**53,287,208**|



The figures have been restated due to the reclassification of the "Original Endowment" as an endowment fund, when legally it is unrestricted, for further detail see note 15. 

The restatement increases unrestricted income by £58,127, unrestricted expenditure by £41,728 and unrestricted investment gains are reduced by £11,750. Restricted income is decreased by £53,202 and restricted expenditure by £41,728. 

Endowment income is reduced by £4,925 and investment losses are reduced by £11,750. 

37 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 25 **Comparative information (restated)** 

## **Consolidated Endowment Funds** 

|Foundation Capital<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>Expendable Endowment<br>Development Fund<br>Merchant Taylors' School Bursary<br>and Scholarship Trust|**Restated**<br>**Balance**<br>**Incoming**<br>**Resources**<br>**1.9.18**<br>**resources**<br>**expended**<br>**£**<br>**£**<br>**£**<br>5<br>-<br>-<br>49,195<br>191<br>-<br>135,449<br>525<br>-<br>423,472<br>1,642<br>-<br>291,692<br>1,131<br>447,676<br>-<br>-<br>1,186,813<br>-<br>-<br>6,978,641<br>20,725<br> <br>-<br> <br> <br>4,444,339<br>17,236<br>-|**Transfers**<br>**(note 6)**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-|**Investment**<br>**Balance**<br>**gains/(losses)**<br>**31.8.19**<br>**£**<br>**£**<br>-<br>5<br>(455)<br>48,931<br>(1,253)<br>134,721<br>(3,918)<br>421,196<br>(2,701)<br>290,122<br>3,785<br>451,461<br>10,408<br>1,197,221<br>(41,120)<br>4,420,455<br>|
|---|---|---|---|
||||(35,254)<br>6,964,112|



## **Trust Endowment Funds** 

|**Trust Endowment Funds**||||
|---|---|---|---|
|Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>Merchant Taylors' School Bursary<br>and Scholarship Trust|**Restated**<br>**Balance**<br>**Incoming**<br>**Resources**<br>**1.9.18**<br>**resources**<br>**expended**<br>**£**<br>**£**<br>**£**<br>4,444,339<br>17,236<br>-<br>49,195<br>191<br>-<br>135,449<br>525<br>-<br>423,472<br>1,642<br>-<br>291,692<br>1,131<br>5,344,147<br>20,725<br> <br>-<br>|**Transfers**<br>**(note 6)**<br>**£**<br>-<br>-<br>-<br>-<br>-|**Investment**<br>**Balance**<br>**gains/(losses)**<br>**31.8.19**<br>**£**<br>**£**<br>(41,120)<br>4,420,455<br>(455)<br>48,931<br>(1,253)<br>134,721<br>(3,918)<br>421,196<br>(2,701)<br>290,122|
||||(49,447)<br>5,315,425|



The "Original Endowment Fund" was incorrectly classified as an endowment fund and restricted income fund and this has been reclassified to unrestricted funds. Endowments were overstated in 2019 therefore to the value of £1,263,103 (2018: £1,269,928) and restricted funds by £190,863 (2018: £179,389). The impact on the Statement of Financial Activities is detailed below the comparative information for the Statement of Financial Activities. 

38 



MERCHANT TAYLORS' EDUCATIONAL TRUST 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 26 **Comparative information (restated)** 

|**Consolidated Restricted funds**<br>**St John's School**<br>Prepreparatory refurbishment<br>**Merchant Taylors' School**<br>General Donations<br>Development Fund<br>Sports, art and school campus<br>Capital projects<br>MTET Restricted Fund<br>**Endowment income funds**<br>Bursary and Scholarship Trust<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund<br>**Trust**<br>MTET Restricted Fund<br>**Endowment income funds**<br>Bursary and Scholarship Trust<br>Lort-Williams' Fund<br>Sir Christopher Harding's Fund<br>Lord Hailey's Fund<br>MTET Prize Fund|**Balance**<br>**1.9.18**<br>**£**<br>6,250<br>362,356<br>329,623<br>23,904<br>42,992<br>1,091,651<br>226,293<br>1,910<br>5,261<br>16,455<br>163,951<br>2,270,646<br>1,091,651<br>226,293<br>1,910<br>5,261<br>16,455<br>163,951<br>1,505,521|**Incoming**<br>**resources**<br>**£**<br>-<br>66,413<br>191,599<br>10,376<br>10,330<br>4,235<br>216,489<br>2,061<br>5,674<br>17,741<br>27,653<br>552,571<br>4,235<br>216,489<br>2,061<br>5,674<br>17,741<br>27,653<br>273,853|**Resources**<br>**expended**<br>**£**<br>-<br>(304,549)<br>(145,214)<br>(8,728)<br>(15,902)<br>(10,078)<br>(168,285)<br>(1,869)<br>(4,077)<br>(13,812)<br>(3,594)<br>(676,108)<br>(10,078)<br>(168,285)<br>(1,869)<br>(4,077)<br>(13,812)<br>(3,594)<br>(201,715)|**Transfers**<br>**(note 6)**<br>**£**<br>(1,250)<br>196,000<br>-<br>-<br>-<br>-<br>(176,400)<br>(1,960)<br>(3,920)<br>(13,720)<br>-<br>(1,250)<br>-<br>(176,400)<br>(1,960)<br>(3,920)<br>(13,720)<br>-<br>(196,000)|**Investment**<br>**gains/(losses)**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>(10,100)<br>-<br>-<br>-<br>-<br>-<br>(10,100)<br>(10,100)<br>-<br>-<br>-<br>-<br>-<br>(10,100)|**Balance**<br>**31.8.19**<br>**£**<br>5,000<br>320,220<br>376,008<br>25,552<br>37,420<br>1,075,708<br>98,097<br>142<br>2,938<br>6,664<br>188,010|
|---|---|---|---|---|---|---|
|||||||2,135,759|
|||||||1,075,708<br>98,097<br>142<br>2,938<br>6,664<br>188,010|
|||||||1,371,559|



The figures have been restated due to the reclassification of the "Original Endowment" as an endowment fund, when legally it is unrestricted, for further detail see note 15. 

39 



_MERCHANT TAYLORS' EDUCATIONAL TRUST_ 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 26 **Comparative information (restated) Unrestricted Funds** 

## **Consolidated** 

|General Reserve<br>Designated funds:<br>Designated Bursary Fund<br>Housing Fund<br>Pension Fund<br>OMT Asset Fund<br>Durrants' Fund<br>Fees in Advance<br>Trading Company<br>Total designated funds<br>Unrestricted funds<br>**Trust**<br>General Reserve|**Restated**<br>**Balance**<br>**1.9.18**<br>**£**<br>32,042,578<br>1,357,399<br>49,591<br>114,580<br>5,094,404<br>3,624,648<br>18,617<br>1<br>10,259,240<br>42,301,818<br> <br>**Restated**<br>**Balance**<br>**1.9.18**<br>**£**<br>1,449,307|**Incoming**<br>**resources**<br>**£**<br>28,890,968<br>32,109<br>-<br>-<br>-<br>61,625<br>1,056<br>311,257<br>406,047<br>29,297,015<br>**Incoming**<br>**resources**<br>**£**<br>58,127|**Resources**<br>**expended**<br>**£**<br>(27,041,112)<br>(6,680)<br>-<br>-<br>(189,885)<br>(8,918)<br>-<br>(193,385)<br>(398,868)<br>(27,439,980)<br>**Resources**<br>**expended**<br>**£**<br>(41,728)|**Other gains/**<br>**(losses)**<br>**£**<br>(17,484)<br>19,989<br>-<br>-<br>-<br>24,729<br>-<br>-<br>44,718<br>27,234<br>**Other gains/**<br>**(losses)**<br>**£**<br>(11,750)|**Transfers**<br>**between**<br>**funds**<br>**(note 6)**<br>**£**<br>115,675<br>-<br>(3,552)<br>7,000<br>-<br>-<br>-<br>(117,873)<br>(114,425)<br>1,250<br>**Transfers**<br>**between**<br>**funds**<br>**(note 6)**<br>**£**<br>-|**Balance**<br>**31.8.19**<br>**£**<br>33,990,625|
|---|---|---|---|---|---|---|
|||||||33,990,625<br>1,402,817<br>46,039<br>121,580<br>4,904,519<br>3,702,084<br>19,673<br>-|
|||||||10,196,712|
|||||||44,187,337|
|||||||**Balance**<br>**31.8.19**<br>**£**<br>1,453,956|



The General Reserve in the Trust has been restated and is the balance on the reclassified 'Original Endowment' fund. 

40 



_MERCHANT TAYLORS' EDUCATIONAL TRUST_ 

## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 25 **Comparative information (restated)** 

**Allocation of the net assets of the charity** 

|**Fixed assets**<br>**and investments**<br>**£**<br>Group<br>**Unrestricted funds**<br>42,861,357<br>**Restricted funds**<br>1,846,983<br>**Endowment funds**<br>6,964,112<br>51,672,452<br>Trust only<br>**Unrestricted funds**<br>1,324,198<br>**Restricted funds**<br>891,920<br>**Endowment funds**<br>5,315,425<br>7,531,543|**Net**<br>**Current**<br>**assets**<br>**£**<br>2,500,850<br>288,776<br>-<br>2,789,626<br>129,768<br>479,639<br>-<br>609,407|**Long**<br>**term**<br>**liabilities**<br>**£**<br>(1,174,870)<br>-<br>-<br>(1,174,870)<br>-<br>-<br>-<br>-|**Total**<br>**2019**<br>**£**<br>44,187,337<br>2,135,759<br>6,964,112|
|---|---|---|---|
||||53,287,208|
||||1,453,966<br>1,371,559<br>5,315,425|
||||8,140,950|



41 



_MERCHANT TAYLORS' EDUCATIONAL TRUST_ 

**NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020** 

## 25 **Comparative information (restated)** 

## **Analysis of total resources expended** 

|**Cost of generating funds**<br>Trading & investment costs<br>Financing<br>**Charitable activities**<br>Teaching costs<br>Welfare<br>Premises<br>Support costs<br>Schools' operating cost<br>Bursaries paid for by restricted funds<br>Depreciation on OMT sports facility<br>Grants<br>Other costs<br>Governance costs<br>**Total resources expended**<br>Publicity/advertising and development|**Staff costs**<br>**£**<br>135,227<br> <br>-<br>-<br>135,227<br>14,363,421<br>841,038<br>1,366,186<br>1,546,149<br>18,116,794<br>-<br>-<br>-<br>-<br>-<br>18,252,021|**Other**<br>**£**<br>98,569<br>254,093<br>41,762<br> <br>394,424<br>1,958,621<br>535,592<br>3,088,524<br>1,439,530<br>7,022,267<br>382,092<br>-<br>172,282<br>31,123<br>9,870<br>7,980,935|**Depreciation**<br>**£**<br>-<br>-<br>-<br>-<br>-<br>-<br>961,087<br>701,037<br>1,662,124<br>-<br>189,885<br>-<br>-<br>-<br>1,852,009|**Total**<br>**2019**<br>**£**<br>233,796<br>254,093<br>41,762|
|---|---|---|---|---|
|||||529,651<br>16,322,042<br>1,376,630<br>5,415,797<br>3,686,716|
|||||26,801,185<br>382,092<br>189,885<br>172,282<br>31,123<br>9,870|
|||||28,116,088|



42