REGISTERED COMPANY NUMBER: 908985 {England and Wales) REGISTERED CHARITY NUMBER: 312101 REPORT OF THE TRUSTEES AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 FOR EMERSON COLLEGE TRUST LIMITED HPGA Limited Chartered Accountants and Statutory Auditors Stslion House Connaught Road Brookwood Woking Surrey GU24 OER EMERSON COLLEGE TRUST LIMITED CONTENT F THE CONSOLIDATED FINANCIAL STATEMENTS for the èar ènded 30 June 2023 Page Report of the Trustees 3107 Report of the Independent Auditors 71010 Consolidated Statement of Financial Activities 11 Consolidated B¥lance Sheet 12 Charitable Company B81ance Sheet 13-14 Cash Flow Ststement Notes lo the Cash Flow Statement 16 Notes to the Financial Statements 171032 EMERSON COLLEGE TRUST LIMITED REPORT OF THE TRUSTEES for the ear ended 30 June 2023 The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial sl8tements ol the charity for the year ended 30 June 2023. The trustees have adopted the provisions of Accounting and Reporting by Charities.. Statement of Recornmended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 (effective 1 January 20191. OBJECTIVES AND ACTIVITIES Objectives and organisation of the charity The principal objective of the charity is the administering of the Emerson College Trust Limited and the promotion of an adult centre of training for study and resear¢h in accordance with Steiner educational principles with special emphasis on education, agriculture, arts, and science. This benefits society by furthering alternative models in areas which are g8nerally acknowledged to need new thinking. In furtheranc& of ils objects, the charity operates Emerson College, Forest Row. Funds raised and donations are applied to promote study and research in anthropDsophy and biodynamic agriculture. The Trustees are aware of their duty to have due regard to the Charity Commission's public benefit guidance in formulating the strategy for the charity. They are satisfied that the objectives of the charity are of public bènèfit. ACHIEVEMENT AND PERFORP4lANCE Charitable activities Emerson College is a vibrant College with a rich, exciting, and varied programme of courses, performances, and talks. In the past year we have ¢¢ntinued to develop our own courses, following the negative impact of the coronavims pandemic. We have built up a number of su¢¢essftJl partnerships with other course providers and individuals to offer inspiring courses on the Emerson Campus in three different fields: Arts.. visual arts, storytelling la range of short, modular, and longer courses), clowning, eurythmy, poetry. sacred geometry, ceramics, singing. Care.. anthroposophical nursing, anthroposophical medicine, mental health, social therapy, counselling, herbal medicine, psychotherapy, holistic baby and childcare., spiritual care for those on the joumey of death and dying, working with trauma. Ecology.. sustainable agriculture, Goethean science, water research, medicinal herb cultivation. We continue to support participants to attend courses through g reduction of fees from our L)ursary fund. This gave access lo courses for people on Universal Credit, on low income or those that have caring responsibilities for family members. The college has continued to make improvements to the upgfftde of our student houses and other parts of the estate. We have continued to irnprove the administrative infrastructure of the organisation with new event bookings systems. IT servers and wireless connectivity installations all which contribute to a better running of the charity. The main strategic focus under the management of assets has been to undertake the sales of three properties to invest in capital expersditure in relation to upgrading Pixton House and other teaching and art studios. This has included the renovation of the North Dining Room. Iparticularly its beautiful roof lantern windows), and Music Room and transforming the Potting Sh8d into an Emerson Café and a￿oCIated dining areas into potential performancelevenl facilities. Other improvements have been focused in installing easy acce5S toilets in the Red Studio and Eurythmy House, with new roofing to the Story Hut, Green Studio and Green Studio Long. Taken as a whole, these improvements have positioned Emersor> as a much better facility for many of the activities which it facilitates and promotes. Event Hire and Accommodation Bookings. togethèr with new Course developmènt continue lo grow with activity and sales increasing by 190/D in the year. which is a trend that is contir¢uing into Ihe year 2023124 The Board of Trustttes agreèd a strategic staffing and recruitrnenl plan in the year to create and recruit to the roles of Co- Principal for Education and Head Df Hospitality, as the basis to enable significant growth in the areas of Emerson Courses and External Hire activities and lo enhance the quality of experience for visltors to Emerson. During the year the Co-PrinGipal for Asset Management and the of Head of Hospitality resigned. After careful str8tegie planning the Board resolved to establish the Co-Principal for Education as Principal and CEO for Emerson and re define the organisational responsibilities through the senior leadership team. Page S of 32 Future development Th@ upgrade of Pixton House will enable opening of the Emerson Café in the Year 2023124. Building on our strategic recruitment, we are planning for an incorne growth of 200/0. forming part of our three year income growth p13n, which aims to establish business sustainability by the year 2025126 Focal points of our efforts in the coming year are.. Opening the Emerson Café Rebuilding our income through the development of new courses, increased enrolmènl and venue hire Repaying the CIBLS loan through the rnechanism of the Ihree-yesr incorne growth plan Building on maintaining our publicly accessible estate, as a place of beauty for the benefit of our community and visitors, through the development of Botsnical Garden Walks linked lo the Emerson Café activity and the eskte's Derneter status. Maintaining and building on the Demeter certification of our estate through the development of new Biodynamic activities and sustainable horticulture programmes Improving the online booking systèm to enable better registration for students and participants and increase mid-week bookings Renewing our website and increasing our reach on social media Improving our donation sofbNare Increasing our fundraising efforts lo support our work Seeking grant support to renovate our facilities and improve accessibility Our Board structure, which now includes the Principal for Educstion and senior staff as required, together wlh the trustees, ¢ontinues to work well. There were [70 changes to our trustees. During the year a total of £ 262,304 was re￿1Ve￿ in donations, including £ 177,943 from our tradiTrg subsidiary, plus £84,361 in other grants. FINANCIAL REVIEW Investment policy and objectives The Trustees have unlimited investment powers and currendy the ¢harity has unlisted investments as detsiled in the notes to the fi'nancial statements. Reserves pollcy The Trustees consider that the charity's assets are adequate to fulfil ils obligations and that it has sufficient free res@Nes to meet all ongoing operating costs for a period of six months. As at 3010612D23 the Trust and its subsidiary held a total of £401,820 in cash, with an outstanding loan of £ 146,667. OPERATING COSTS AND INCOME Vve made an operating loss of £195,719, excluding the net proceeds from asset sales1£265,9221 and the Mercury Provident Pension Scheme IMPPSI costs for the year1£67,723) Is@e note 8, page 22) - In addition to that and due to a revaluation of the MPPS liability which will be revlewed at the end of 2024, the accounts show an actuarial loss of £207.708 Is$8 note 20, page 341. STRUCTURE, GOVERNANCE AND MANAGEMENT Governing document The charity is controlled by its governing document, the Memorandum, and Articles of Association, and Gonstitutes a limited company, limited by guarantee, as defined by the Companies Act 2006. Organisational structure The charity is governed by its Memorandum and Articles of Association. Activities are overseen by the Council consisting of Tmstees who meet six times each year or more frequently if required. The Articles of Association lay down that the Council shall comprise no fewer than 3 and no more than 20 Trustees. All Trustees need to be a member of the association. Induetion and training of new trusteès Trustees are appointed at the AGM when 81 least a third of the existing Trustees must sland down. Aftyone wishing to becomo a Trustee must first become s member of the Emerson Association. As the Association is premised on the vision and work of Rudolf Steiner, il is esser)tial thzl all Trustees can demonstrate that they are familiar with this vision and that il is an integral part of their lives. Page 4 of 32 Other qualities that Emerson Association would value in prospective Trustees would be experience working in other charities, specific professional skills, or experience in the field of adult education. Several of the existing Trustees were former students at Emerson. At present Emerson does not have any specific policy on Trustee training, except lo ensure all Trustees are familiar with current Charity law and the duties of Tlusteeship, but of course the Trust would send individual Trustees on special courses if this were deemed necessary. However, to ensure good working practice, there are regular discussions concerning Charity Commission guidance on good govemance and practice 81 Trustee meetings_ REFERENCE AND ADMINISTRATIVE DETAILS Registered Company number 00908985 (England and Wales) Registered Charity number 312101 Registered office Pixton Hartfield Road FOREST ROW East Sussex RH18 5JX Trustees J Dyson P Blaxland de Lange K Orsak {resigned 1.11.22} R Levy (resigned 1.11.22) A Blampied-Radojcin M Leach S King S Fuller (appointed 4.11.22) J Smith lappointed 4.11.221 Auditors Shaw Gibbs (Audit) Limited 264 Banbury Road Oxford Oxfordshire Surrey OX2 7DY Bankers HSBC Bank plc 1 Centenary Square Birmingham B1 1HQ. Bankers Sanlsnder 2 Trilon Square Regent's Place London NW1 3AN P8ge S of 32 EMERSON COLLEGE TRUST LIMITED REPORT OF THE TRUSTEES for the ear ended 30 June 2023 Charities Statemenl of Recommended Practice ISORP 2005) requirements Reserves. The Charity holds thè following reserves.. a. Restricted funds that represent hypothecated grant funding. b. Payments made in advance that will be required lo fttnd expenditure in future years. And Sufficient working capitsl to ensure Ihg Charitable Company remains a going concern and can fund at least six months salaries of all staff employed by the Charity. 2. Principal risks & uncèrtainties.. the following represent the significant risks and uncertainties faced by the Charity.. a. Cost of living inflation which in a(idition to slowing economic growth and increasing the risk of a recession, impacts on the Charity in two principal ways by." i. Inflation results in increasing the c05t of fuel, utilitie8, food, building rrtaterials, and similar products that are required to be purchased lo provide for the on-going operation of the Charity. ii. Creating customer resistance lo fund edLJcalional coursès, events, accommodation, and food due lo the need to priorilise essential costs rather than education which is considèfftd to be a luxury good. It is therefore largely the case that the ability to participate in courses has high income elasticity of demand resulting in more expenditure on courses and events increasing with greater levels of disposable income and the converse during periods of reduced disposable income. The 0￿0 effeds of inflation mitigate against each other- if prices are increased to maintain the viability of a serviTr, then due to the cost elasticity, cost increases will have an effect to reduce the level of demand. b. The trend towards on-line educational courses and podcasts provides substantial opportunities for the Charity, but a consequence is that participants lose the highly valued special characteristics of attending the Emerson Campus with the consequential loss in income from the use of residential accommodation and meals. ¢. Reputational risk- the College enjoys an international reputation for the qLtality of its educational courses but ?Iso the unique campus environment and experience it provides. Reputations are hard earned but easily lost rf the customer experience reduces or an event creates bad publicity for the Charity. As a result, the Charity carefully safeguards its reputation by seeking improvements in the seThice whilst maintaining the special qualities of the customer experience. The principal risks and uncertainties are contained through the Tmslees of the Charity pro-actively investing in the level of educational expertise and resources together with improving the College facilities and the flexibility of servic& provision. Furthermore, as part of the governance of the Charity, a risk policy and comprehensive risk register is pro- actively maintained, that includes identifying risks., assessing risks., evaluating what action needs to be taken on risks and periodic monitoring and assessment at each BDard meeting. 3. The Pay and remuneration policy for key leadership personnel-. 8. The Charity has recenly restructured its senior leadership team to further improve the emphasis on everyone working for ? single oryanisation and contributing to the success Df the organisation. The outcome was to appoint a post of Principal and CEO to replace the two Co-Principals- Educats'on and Asset Development. The level of remuneration for the CEO reporting dire¢lly to the Board was set by the Board of Trustees prior lo the appointmeTrt being made. b. No one is paid more than £60.000 p.a. IFTEI and all posts are contained within the Pay Policy agreed ty the Board of Trustees. The CEO will keep under review the Pay Policy and levels of pay and provide costed options for the Board of Trustees to eonsider and to agree any changes. Page 6 of 32 EMERSON COLLEGE TRUST LIMITED REPORT OF THE TRUSTEES forthe ear ended 30 June 2023 STATEMENT OF TRUSTEES RESPONSIBILITIES The trustees (who are also the directors of Emerson Gollege Trust Limited for the purposes of company lawl are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice}. Company law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the slatè of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing thosg financial statements, the trustees are required select suitable accounting poli¢ies and then apply them consistently., observe the methods and principles in the Charity SORP., make judgements and estimates that are reasonable and prudent", prepare the financial statements on the going concern basis unless it is inappropriate to presume that the ¢haiitable company will continue in business. The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to enable them lo ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities_ In 50 far as the trustees are aware.. there is no relevant audit information of which the charitable company's auditors are unaware., and the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information. AUDITORS The auditors, Shaw Gibbs (Audit) Limited, will be proposed for rtrappointmenl at the forthcoming Annual General Meeting. Approved by order of the board of trustees on 3rdlh November 2023 and signed on its behalf by.. Leach - Trustee Page 7 of 32 REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF EMERSON COLLEGE TRUST LIMITED Opinlon We have audited the financial ststemenls of Emerson College Trust Limited (the 'parent charitable company'} and its subsidiary (the group) for the year ended 30 June 2023 which comprise the Consolidated Statement of Financial Activities, the Consolidated and Company Balance Sheets, the Consolidated Cash Flow Statemènt and notes lo the financial stslements, 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 IUnite(J Kingdom Generally Accepted Accountsng Praetie¢}- In our opinion the financial statements_. give a true and fair view of the slate of the group's and of the parent charitsble company's affairs as a130 June 2023 and of the group's incoming resources and application of resources and application of resources, including ils income and expenditure, for the year then ended., have bèen properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice-, and have been prepared in accordance with the requirements of thè Companies Act 2006. Basis for opinion We conductèd our audit in accordance wtlh International Standards on Auditing IUKI {ISAs {UKII and appliGable law. Our responsibilities under those standards are further described in the Auditors resF>onsibilities for the audit of the financial statements section of our report. We a￿ independent of the groL(p in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, inGluding the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these fftquiremenls. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the trustees, use of the going concem basi5 Of accounting in the preparation of the financial statements is appropriate. Based Dn the work we have performed, we have not identified any material uncortainties relating to events or conditions that, individu311y or collectively, may cast significant doubt on the charitable company's ability to continu¢ as ? going concern for a period of al least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the trustees with respect to going concem are describèd in the relevsnt sections of this r8porL Other intorniation The trustees are responsible for the othèr information. The other information comprises thè informalion included in the annual report, other than the financial statements and our Report of the Independent Auditors thereon. Our opinion on the financial statements does not covgr the other information and wè do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our r8sponsibilty 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 lo be matèrially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a Material misstatement In the finoncial stslemenls themselves. If, based on the work we have performed, we conGlude that there is a material misstatement of this Dther information, we are required to report that fact. We have nothing lo report in this reg8rd. Opinion on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the auditi the information g(vèn in the Report of the Trustees for the financial yèar forwhich the financial ststements are prepared is consistent with the financial statements,. and the Report of the Truste8s has been prepared in accordancè with applicable legal requirements. Matters OT] which we are required to report by exception In the light of thfj knowledge and understanding of the group and parent charitable company and ils environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Trustees_ We have nothing to report in respEcl of the following matters where the Companies Act 2006 requires LJS to report to you if, in our opinion". P8ge 8 of 32 REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF EMERSON COLLEGE TRUST LIMITED adequate accounting records have not been kept or retums adequate for our audit have not been received from branches not visited by LJS,. or the parent charitable company financial statements are not in agreement with the accounting records and returns.. or certain disclosures of trustees, remuneration specified by law are not made., or we have not received all the infom)ation and explanations we require for our audit", or the trustees were not entitled to take advantage of the small companies exemption from the requirement to prepare a Strategic Report or in preparing the Report of the Trustees. Responsibilities of trustees As explained more fijlly in the Statement of Trustees Responsibilities, the trustees (who are also the directors of the charitable company for the purposes of company law) artt responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such intern81 control as the tmslees determine is necessary to en8ble the preparation of financial slalements Ih8t are free from material misstatement, whether due to fraud or ermr. In preparing the financial statements, the trustees are responsible for assessing the group's and parent charitable company's ability to continue as 8 going concern, disclosing, as applicable, matters related lo going Con￿[￿ ancj using the going ¢on¢em basis of accounting unless the trustees either intend to liquidate the group's or parent charitable company or to cease opèmtions, or have no realistic alternative bul to do so. Our responsibilities for the audit of the financial ststements Our objectives are to obtain reasonable assurance about whether the finan¢i81 statements as a whole are frae from material missl8tement, whether due lo traud or error, and to issue a Report of the Independent Auditors that includes our opinion. Reasonable assurance is a high level of assuranTr, but is not a guarantèe that an audit conducted in accordance wth ISAS (UK) will always detect a material misstatementwhen it exists. Misstatements can arise from fraud or error and are considered material rf, individually or in the aggregate, they could reasonably be expe¢led to influence the economic d8cisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design proceduTes in line with our responsibilities, oullined above, to detect material misstatements in respect of irregularities, including fraud. The extent lo which our procedures are capable of detecting irregularities, including fraud is detailed below.. The exient to which the audit was considered capable of detecting irregularities including fraud Our approach lo identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non￿mpliance with laws and regulations, was as follows.. the engagement partner ensured that the engagement team collectively had the appropriate competence, ¢apabililiès and skilts to identify or recognise non-compliance with applicable laws and regulations,. we idefttified the laws and regulations applicable to the chartLable company through discussions with trustees and other management, and from our commercial knowledge and experiencè of the sector,. we focused on specific laws and regulations which we ¢onsidered may have a direct materi81 effect on the Inancial statements or the operations of the ¢h8ritable company, including compliance for accrediting, the Companies Act 2006, taxation, data pmtection, safeguarding, employment, environmental and health and safety legislation., we assessed the extent of compliance with the laws aF3d regulations identified above through making enquiriés of management and inspecting legal Correspondence., and identified laws and regulations were Gommunicated within the audit tgam regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the company's financial slat8m8nls to material misstatement, including obtaining an understanding of how fr8ud might occur, by.. msking ènquiries of management as to wher$ they Considered there was susceptibility lo fraud, their Page 9 of 32 REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF EMERSON COLLEGE TRUST LIMITED knowledge of actual, suspected and all￿ed fraud,. and considering the internal controls in place to mitlgste risks of fraud and non