Company No. 579923 Registered in England Charity No. 312715 DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES YEAR ENDED 31 AUGUST 2020 The Trustees present their annual report together with the audited financial statements of the Dulwich Preparatory Schools Trust (the Trust) for the year ended 31 August 2020. The Trustees confirm that Ihe annual report and financial statements of the Trust comply with the current stalulory requirements, the requirements of the Trust's governing document and Ihe provisions of the Slalemenl of Recommended Practice (SORP) "Accounting and Reporting by Charities" {Charities SORP FRS1021. Status and admlnistration The Trust is a company limited by guarantee (Company Number 579923} and is registered with the Charity Commission under Charity Number 312715. Trustees. responsibilities The Trustees (who are also directors of Dulwich Preparatory Schools Trust for the purposes of company lawl are responsible for preparing the Trustees. report {including the strategic report) 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 lo prepare financial statements for each financial year. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the slate of affairs of the Trust and of the incoming resources and application of resources, including the income and expenditure, of Ihe Trust for that period. In preparing these financial statements, Ihe Trustees are required to.. select suitable accounting policies and th@n apply them consistently., observe the methods and principles in Ihe Charities SORP., make judgments and accounting estimates that are reasonable and prudent., state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements., prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Tru51 will continue in operation. The Trustees a responsible for keeping adequate accounting records that are suffi'cient to show and explain the Trust's transactions and disclose with reasonable accuracy al any time the financial position of the Trust and enable them lo ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Trust and hence for laking reasonable steps for the prevention and detection of fraud and other irregularities. Each of the persons who are Trustees at the time when this Trustees, report is approved has confirmed that.. so far as each Trustee is aware, there is no relevant audit information of which the Trust's auditor is unaware. and each Trustee has taken all the steps that ought to have been taken as a Trustee in order to be aware of any relevant audit information and to establish that the Trust's auditor is aware of that inlormalion.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES YEAR ENDED 31 AUGUST 2020 STRUCTURE, GOVERNANCE AND MANAGEMENT The Trust is the parent charity of two independent school charities, Dulwich Prep Cranbrook and Dulwich Prep London I'the Schools'l - togelher.lhe Group" The Trust supports the provision of educalion by the two Schools and the two Schools lease their facilities from the Trust. Members of the Trust comprise the Trustees of the Dulwich Preparatory Schools Trust. logether with all the Governors of the Schools. The Trust's Articles reflect the Companies Act 2006 and the Charities Act 2011. The length of tenure for Members of the Trust Board is limited lo three terms of office, not to exed a total of ten years except in exceptional circumstances. These changes were approved by the Charity Commission and passed by written resolution on 161h June 2017. Trust Board The Trustees of the Trusl are charity Trustees under charity law and Directors of the Trust for the purposes of company law. The members oflhe Trust Board who seNed in Offi as Trustees during the year and subsequently are detailed below.. Mr D H Nelson Independent Chairman Nominated by the Governing Body of Dulwich Prep Cranbrook Independent Trustee Nominated by the Goveming Body of Dulwich Prep London.. appointed from 1" September 2020 Nominated by the Governing Body of Dulwich Prep London.. retired on 31¥l August 2020 Nominated by the Governing Body of Dulwich Prep Cranbrook Nominated by the Governing Body of DuSwich Prep London Independent Trustee Mr M StJ Ashley Dr S J Bailey Mrs E K Kelleher Mrs C C Randell Mrs S L Rynehart MrJDHSteel Mr M J Tiplady OfficeryJ Secretary to the Trustees.. N B Holliday Professlonal Advlsers Bankers.. Natwest Bank plc, 120-122 Fenchurch Street, London EC3M 5BA Solicitors.. Farrer & Co LLP, 66 Lincoln's Inn Fiekls, London WC2A 3LH Auditor.. Crowe U.K. LLP, 55 Ludgate Hill, London EC4M 7JW
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 Management Structure The Board meets a minimum of three times per year, normally once per academic term. There are three Independent Trustees, including the Chaimian, and each of the Schools nominates two of its Governors (normally including the School's Chairman) as Trustees. The Board has a Finance Committee which meets a week or two prior to Trust Board meetings, and at other times when necessary, lo discuss financial matters on which il advises the Board. The Trust considers the performance of each School. their future plans. budgets and operation, together with applications for capital investment. Trustee Recruitment & Trainlng The Board is self-appoinling, with new Trustees identified and appointed following agreement from all current Trustees. Trustees serve for an initial term of four years. bul may offer Ihemselves for re-election for a second term of four years and then a final term of two years, making len years in total, except in exceptional circumstances. New members of the Board are elected on the basis of the candidates, professional qualities, experience. personal competence and the specific needs of the Trusl. New Trustees are inducted into the workings of the charitable company via a programme organised by the Secretary. The Secretary will also notify members of the Board of relevant external Trustee training and information courses and seminars designed to keep them informed and updated on current issues in the sector and regulatory requirements. Charity Code of Governance The Board takes its governance responsibilities seriously and the Group aims to have a governance framework that is fit for purpose, compliant and efficient. The GroLJP has established a solid foundation in governance in which all of ils Trustees are clear about their roles and legal responsibilities, are commilled Io sUPPOrting the Trust in delivering ils objects most effectively for the benefit of ils beneficiaries and conlribuling to the continued improvement of the Schools. The Group meets the key outcomes set out in the seven areas of the Charity Governance Code. The structure of the Group and the relationship between the Trust and the two Schools are designed in such a way as lo ensure that recommended practice is observed and, where specific aspects a delegated lo the Schools, these aspects are regularly monitored. Employment policy The Trust and each of the Schools is an eqLral opportunities employer. Full and fair consideration is given lo job applications from disabled persons and due consideration is given lo their training and employment needs. Consultation with employees. or their representatives. has continued at all levels with the aim of taking the views of employees into account when decisions are made that are likely to affect their interests. Employees are made aware of the financial and economic performance of the relevant School. Communication wrth employees continues through normal management channels in a variety of forms and also through exceptional channels lo make staff aware of current issues.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 STRATEGIC REPORT The remainder of the report of the Trustees also constitutes the rategiC report for the purposes of the Companies Act 2006. Prlncipal activlty and objects of the charitable company The principal activity of the Trust is the advanment of education in the United Kingdom and elsewhere, currently through the support provided to the two Schools. The Board is mindful of the long-standing need lo provide public benefit and strives to do $0 through the support of development in education generally, through bursaries (mainly provided by the Schools), through working with other educational bodies and the promotion of best practi. Alm The Trustees, aim is that pupils at the Schools should benefit from the provision of first class facilities to enable them to fulfil their potential on all fronts- academic, artistic, dramatic, musical, sporting, social and moral. Prlmary objective The Trust is a charitable trust which promotes the advancement of education in a broad context and in particular at its two Schools in London and Kent. Strategles to achleve the prlmary objectlve The Trust seeks to achieve its primary objective through the implementalion of the following strategies-. By providing an excellent education at Dulwich Prep Cranbrook and Dulwich Prep London., Through the provision of bursaries and other financial support to enable children whose parents would not othenNise be able to afford the fee$ to benefit from an education at the Schools., By raising funds in support of education and organising, or making grants towards, lectures, seminars, broadcasts or courses of instruction.. By considering ways in which technology can be can be used to enhance teaching and learning., Through the provision of classrooms and buildings generally in connection with education al Dulwich Prep London and Dulwich Prep Cranbrook and elsewhere., Through the provision of playing fields, games courts, recreational grounds and pavilions, swimming pools and other facilities in connection with sports, games and recreational activities of all kind5 at Dulwich Prep London and Dulwich Prep Cranbrook and elsewhere.,
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 By setting rents al a level to ensure the financial viability of the Schools and at a level that is consistent with future capital investment to provide a first class education to boys and gids at the Schools., Through the maintenance of a clear and effective management structure and the necessary support framework to meet the needs of the Schools., By acting as banker lo the Schools and by lending money to facilitate the cash flow of each School. The Trust considers bids for capital expenditure from the Schools to enhance the Schools, facilities. The Lower School project in London was completed in July 2019 after a two year programme which was funded by the Trust in support of Dulwi¢h Prep London. During the year the Trust also sold surplus residential property in London and planned the sale of land al Cranbrook as a residential development site. Publlc beneflt The Trust remains committed to the aim of providing public benefit in accordance wlh ils founding principles. Charity legislation includes a requirement to demonstrate public benefit for any charitable purpose where il had hitherto been presumed in the absence of evidence lo the contrary. This calls in turn for commensurate disclosure of our public benefit aims. The awarding of bursaries for the needy is a measurable means of providing public benefit. The Board lakes the view that bufsaries awarded lo those who would not othewise be able lo afford the fees are important, bul not to the exclusion of the much wider benefit that the Trust provides within the ¢ommunily. The Trust's public benefit commitment is currently delivered primarily through the two Schools, each of which has a bursary programme. Ouring the year the Trust's Schools provided bursary support totalling £418k to 38 pupils {2019'. £482k to 46 pupils) of which 16 were for 70 /0 or more of full fees. In addition there was support for local charities and educational bodies through fund-raising activities, outreach programmes and the loall of facilities. Both the Trust's Schools work with Place2Be promoting child mental health awareness. Fifteen slate schoo15 benefited from the Trust's Schools in a variety of ways from the use of facilities to support from staff. The Trust does not engage with any external third party fundraisers. There have been no complaints in the period regarding inappropriate or intrusive contact in relation to fundraising activities. Streamlined Energy and Caibon Reporting {SECRI The Trustees have considered the requirements of The Companies (Directors, Report) and Limited Liabilities Partnerships (Energy and Carbon Report) Regulations 2018. The two Schools each meet two of the criteria for non-disclosure and therefore are not required to produce a report. As a result, since the Trust, as the parent entity, does not produce any emissions, the Trustees have concluded that the Group does not need to submit a return. Section 17211} Report incorporatlng Statements of Employee and Stakeholder engagement The Trustees of the Trust, as Directors of the Company, act in the way they consider, in good faith, would be most likely to promote the success of the Group for the benefit of its members as a whole and in doing so have gard to..
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 al The likely consequences of any decision in the long run- bl The interests of the Group's employees., cl The need to foster the Group s business relationships., dl The impact of the Group's operations on the community and the environment., e) The desirability of the Group maintaining a reputation for high standards of business conduct., fj The need to act fairly. The Trust achieves the success of ils wtder charitable purposes through the activities undertaken by ils Schools, which are regularly monitored and assessed. This incorporates the desire to meet the requirements of all stakeholders, whether pupils and the wider communf(y, staff. donors, fee payers and suppliers, The Trustees consider that they have promoted the Trust's charrtable purpose. as set out in aims and objectives on page 4, in the following ways.. a} The likely Consequen of any decision in the long run.. The Trustees have considered the long-term sustainability of the Schools, operations. as set out in the Going Concern section of the Financial Review on page 9. - The Board sets and approves strategic direction and policy, meets three limes each year and additionally as required. The Board monitors the work of the Schools through its Finance Committee and through reports from the Schools. representatives on the Trust Board. The Finan Committee reviews the Schools, financial plans on a termly basis by monitoring income and expenditure against forecasts within the context of the annual budgets and the rolling 5 year financial plans. Capital expenditure plans and cash flow requirements are also closely reviewed, particularfy in the light of the Trust's borrowing commitments and repayment requirements. Risk management is incorporated into all of the Group's operations and robust risk management procedures are well eslablished. The most significant risks are discussed at each relevant Trust Board meeling. Further details are contained on page 9. The Trustees review and endorse all policies to ensure consistent long term regulatory compliance. b) The interests of the Group's employees.. - Authoritative and frequent communicalion with staff at the two Schools has been essential. especially during the lockdown when many staff were working remotely. This has been conducted by regular staff team meetings and routine weekly wrillen communications lo staff and parents. Staff who have been furloughed have been contacted by their own line management and through a series of newsletters and other communications to maintain their awareness. Staff have been kept informed about staffing, financial and strategic issues affecting them and the Schools. Full details of the employment policy are contained on page 3. The Trustees receive regular reports on staff matters through the Schools, termly reports. All senior managemenl are involved in the early stages of the strategic plan development, and staff are updated on the plan and priorities at the start of each academic year.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 Meaningful engagement is encouraged through the staff forum at each School where employees across all departments discuss and make recommendations direct to senior management. A diverse programme of well-being activities is available lo all staff. At both Schools there was a full consultation programme prior to each Schools, decision to withdraw from the Teachers, Pension Scheme. e) The need to foster the Group's relationships with stakeholders.. The Group's beneficiaries and donors are the focus of all the Schools, operations. A fair and consislenl selection policy ensures a diverse and thriving pupil body who are fully supported throughout their education from nursery to external examinations for the senior schools of their choi, enabling and preparing pupils for later life. Robust recruitment of the best teachers and valuing staff supports slability and a high standard of education. A fair policy of bursary awards. consistently applied, supports families who may not otherwise be able to access education al the Schools. The parent contract forms the basis of the relationship with fee payers. This is reviewed regularly to ensure best practice and then applied fairly and consistently. Parental engagement is maintained through regular correspondence and termly publications. All suppliers are treated fairly and promptly with adherence to business terms. The Group receives regular reports and updates in fundraising regulations through the Schools,. the Schools do not engage with any external third party fundraiser5. dl The impact of the Group's operations on the community and the environment.. The Group supports the Schools in undertaking a full provision of community and partnership activity. Full details are contained on page 5. el The desirability of the Group maintaining a reputation for high standards of business Condu.. The Schools, Bribery Policres set out the responsibilities for staff to report any incidents or suspicion of fraud, bribery or corruption arisir7g in the course of Iheir work and to cooperate fully with related investigations. The Schools take a zero tolerance approach towards fraud. bribery and corruption. The Whistleblowing Policies 5UPPOrt staff in this approach. fj The need to act fairly.. All Trustees and Senior staff complete an annu81 Conflict of Interest Declaration. There have been no reported incidents of unacceptable relationships.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 ACHIEVEMENTS AND PERFORMANCE Rèview of achievements and performance for the year The year was split into two very different six month periods. During the first six months the Trust was concerned with pursuing the snagging and final account in respect of the Lower Sch¢)ol projed. This project was a clear demonstration of the Trust's commitment to maintaining the Schools, excellence through its extensive capital investment programme. The redevelopment of the Lower School in London, including new kitchens and a new servery was completed in July 2019 in time for the School to be in occupation at the start of the academic year 2019120. The project was funded by the Trust in support of Dulwich Prep London at a cost in the region of £13.5 million. This cost was partly covered through the sale of surplus residential property in London, which completed on 3, July raising £81 Ok gross, and partly through a bank loan of £5 million s8cured on olher freehold residential property. The Trust only drew down £4.3 million of the loan. The second six months of the year was characterised by the Covid-19 pandemic and the Trust's Schools, in common with all other schools in the UK, were obliged to close from 24 March. Both Schools rolled out on-line learning platforms incorporating a mixture of home exercises, pre-recorded videos and remole teaching. In addition, both Schools provided key workér teaching from March to July. From 131 June, and following extensive risk assessments, certain Year Groups were able to return to school. At the end of the academic year the Trusl's Schools sent 189 pupils to over 30 different senior schools. including many of the lop schools in the UK. Between them these pupils gained the offer of 115 scholarships and awards. The Trust's recognition of the importance of providing a first class education was demonstrated by the variety of these awards which were achieved not only for academic success, but also for art. DT, music and sport. Following a full consultation process Dulwich Prep Cranbrook withdrew from the Teachers, Pension Scheme and initiated a new allernative defined contribution pension arrangement with effect from 181 November 2019 FINANCIAL REVIEW The Group's net income for the year ended 31 August 2020 amounted to £1,020,818 {2019'. £1,986,237). The nel cash generated from operations was partially used lo pay for the Trust's capital expenditure on the Lower School project in support of Dulwich Prep London. The net book value offixed assets amounted to £42.625,05312019.' £43,409,714). The Trust receives income through the rents received from the Schools for their use of educalional and residential property. 11 also benefits from donations of surplus funds from the Schools when the Schools. reserves policies permit.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 Reservos The Trust's reserves policy is to maintain its free unrestricted reserves al a minimal level given Ihe confidence it has in its continuing income stream from the Schools, both from renls and from any surpluses. At any lime, however, il may build up reserves in anticipation of a future capilal project to support the Schools or to support ils other charitable objectives. Alternatively, as at present. it may be prepared to borrow funds for the short to medium term to invest in capital projects to support the Schools. At the year end, therefore, the Trust had negative free unrestricted reserves of £7,304,575 (2019.. £8,447,307). The Trust's reseNes policy is influenced by the level of reserves at subsidiary undertaking level and the Trust and subsidiary undertakings may, from time to lime, build up reserves in anticipation of a future capital project at either school or to meet other charitable objectives. Funds held by the Group at the year end lolalled £37,740,666 {2019'. £36,719,848) with negativé free unrestricted reserves including pension resee$ of £4,898,22712019.' £6,703,368). The Trustees have considered the reserves policy in light of the Covid-19 pandemic and have concluded that no adjustments to the policy need to be made. Post balance sheet events Having completed consultation with teaching staff in respect of the School's continued membership of the Teachers, Pension Scheme, the Board of Dulwich Prep London made the decision on 271h January 2021 to withdraw from the Scheme on 31° Augusl 2021. While much of the Trust's property is freehold il leases parts of its London facilities from th8 Dulwich Estate. In September 2020 a 50 year lease extension to 2081 was secured on the main srte which extends the Trust's leases on ils key London facilities for the benefit of Dulwich Prep London. Underthe terms ofthe agreement a premium of£1.1m is payable to the Dulwich Estate in three tranches.. all three tranche5 have now been paid. The sale of the residential site at Cranbrook noted above exchanged on 71b August 2020 and completed on 14th Septemter 2020 raising £1.425m gross. Golng concèrn All the pupils al both Schools returned for the start of the Autumn Term 2020. However, in Iht of the Covid-19 pandemic and the imposition of a third lockdown in January 2021 the Group's cash flow was reviewed using assumptions designed to reflect a conservative assessment of the impact of Covid-19, particularly on the revenues of each School taking into account each School's experience over the Summer Term 2020. These have included the refunds to parents provided at each School, the forecast enrolment of pupils and the decision to freeze fees at current levels for the next academic year 2020121 as well as parents, ability to pay fees. Each School has also reviewed its expected expenditure and sought to make savings wherever possible withoLrt impacting on the quality of education, including taking advantage of the furloughing of, primarily, non-academic staff.
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 Certain capital expenditure has been postponed and the Trust has agreed a repayment holiday on its existing loan for 12 months from June 2020. Having assessed the Trust's financial position and its available facilities. the risks to which it is exposed and the detailed cash projections noted above the Trustees are satisfied that it remains appropriate to prepare the statements on a going concem basis. Future plans To continue to stretch atKI challenge all pupils academically irrespeclive of their level of ability and to offer them a broad range of artistic, musical and sporting options. To give children the opportunity to move on to a large and varied range of senior schools. To continue lo seek and provide opportunities to engage with local maintained schools and the wider community and through this to ensure staff, parents and pupils have an appreciation of the world around them and the difference they can make. To offer bursary places at the Schools lo pupils whose parents would not olheNise be able to afford the fees. To continue to increase pupil numbers. To continue to ensure financial stability. To retain high performing staff and provide them wfth developmenlal training. To ¢onlinue to develop the Schools, srtes as and when required, including the extension of Ihe Pre-Prep building in London. PRINCIPAL RISKS AND UNCERTAINTIES The Trustees considered the affordability of fees by parents across the independenl sector to be the principal risk faced by the Trust. This risk is likely to increase as thefulure financial impact of Covid-19 emerges in the coming months and years. Other economic and political risks include the unrtain implications of Brexit in the coming months and years, the potential removal of business rale relief enjoyed by both Schools as Charities and Ihe potential introduction of VAT on school fees. Heallh and Safety is afways a significant area for risk management. The risks range from fire and infrastructure to personal risks (most notably when away from the campus on trips and expeditions). The level and breadth of activity at the Schools is impressive and the risks associated with all activities are minimised by thorough planning and risk assessment. Detailed consideration of risk is undertaken for each School by ils Board, with input from the Senior Leadership Teams. The Trust also considers risk at Group level and the Risk Register is a standing item at each Board meeling. The risk management process and Ihe resulting register idenlrfy risks, assess their impact and likelihood and. where necessary, recommend controls lo mitigate and monitor those risks which are assessed as high. In particular. the threat arising from any terrorisl activity in London is kepl under close review. The generic controls used by the Trust to minimise risk include.. detailed terms of reference together with fomial agendas for Board activity: strategic development planning, reviewed annually by the Board,. comprehensive budgeting and management accounting., established organisalional structures and lines of reporting. formal written policies including clear authorisalion and approval levels., vetting procedures as required by law for the protection of the vulnerable. 10
DULWICH PREPARATORY SCHOOLS TRUST ANNUAL REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2020 The Trustees regularly review the effectiveness of current plans and strategies for managing all Identified major risks for the Group. Approved by the Board of Dulwich Preparatory Schools Trust, including, in their capacity as company directors, approving the Directors. and Strategic Report contained therein, and signed on its behalf by.. D H Nelson Chairman Date: 23rd March 2021
DULWICH PREPARATORY SCHOOLS TRUST INDEPENDENT AUDITOR'S REPORT YEAR ENDED 31 AUGUST 2020 Opinion We have audited the financial statemenls of Dulwich Preparatory Schools Trust for the year ended 31 August 2020 which comprise Ihe Consolidated Statement of Financial Activities, the Group and Trust Balan Sheet. the Consolidated Cash Flow Statement and notes lo the Financial Statements. 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 Irue and fair view of the state of the Group's and the charitable company's affairs as al 31 August 2020 and of the Group's incoming resources and application of resources, including its income and expenditure 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 Companies Act 2006. Basis for opinlon We conducted our audit in accordance with Inlemational Standards on Auditing (UK} {ISAs {UKII and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requiremenls that are relevant lo our audit of the financial slalements in the UK, including the FRC'S Elhical Standard, and we have fulfilled our other ethical responsibilities in accordan with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusion$ 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 90ing 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 uncertainlies that may cast significant doubt about the Group s or the charitable company s ability to continue to adopt the going concern basis of accounting for a period of at least Iwelve months from the date when the financial statements are authorised for issue. Other infomiation The Trustees are responsible for the other information. The other infomiation comprises the information included in the annual report, other than the tinancial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent othenmise explicitly slated in our report, we do not express any form of assurance conclusion Ihereon. 12
DULWICH PREPARATORY SCHOOLS TRUST INDEPENDENT AUDITOR'S REPORT YEAR ENDED 31 AUGUST 2020 In connection with our audit of the financial statements, our responsibllity 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 misslalement 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 r4uired lo report that fact. We have nothing to report in this regard. Oplnlons on other matters prescrlbed by the Companles Act 2006 In our opinion based on the work undertaken in thé course of our audit the information given in the Trustees. report. which includes the Directors, Report and the Strategic Report prepared for the purposes of company law, for the financial year for which the financial slalements are prepared is consistent with the financial slalemenls., and the Strategic Report and the Directors, report included within the Trustees, report have been prepared in accordance with applicable legal requirements. Matters on whlch we are required to report by exceptlon In light of the knowledge and understanding of the Group and the charitable company and their environment obtained in the course of the audit, we have not identified material misslalements in the strategic report or the Directors, report included within the Trustees, report. We have nothing lo report in respect of the following mallers in relation to which the Companies Act 2006 requires us to report to you if, in our opinion.. the parent company has not kept adequate accounting records.. or the parent company financial statements are not in agement with the accounting records and returns., or certain disclosures of Trustees, remuneralion specified by law are not made., or we have not received all the information and explanations we require for our audit. Responslbilities of Trustees As explained more fully in the Trustees, responsibilities slalemenl set out on page 1, the Trustees (who are also the Directors of the charitable company for the purposes of company lawl 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 15 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 or the charitable company's ability to continue as 8 going concern, disclosing, as applicable, 13
DULWICH PREPARATORY SCHOOLS TRUST INDEPENDENT AUDITOR'S REPORT FOR THE YEAR ENDED 31 AUGUST 2020 matters related to going concern and using the going concem basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so. Auditor's responsibilities for the audit of the financlal statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from malerial misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, bul is not a guaranlee that an audit conducted in accordance with ISAS {UKI will always detect a material misstatement when il exists. Misstalemenls can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected lo influence the economic decisions of users taken on the basis of Ihese 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.or .uklaudilorsres onsibilities. This description forms part of our audilorfs report. Use of our report This report is made solely to the charitable company's members, as a body. in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audil work has been undertaken so that we might stale lo the charitable company's members those matters we are required to stale to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do nol accept or assume responsibility lo anyone other than the charitable company and the charitable company s members as a body, for our audit work, for this report, or for the opinions we have formed. Tina Allison Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor 55 Ludgate Hill London EC4M 7JW 26 March 2021 14
DULWICH PREPARATORY SCHOOLS TRUST CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2020 {Incorporating an income and expenditure account) Unrestrlcted Restricted Funds Fund5 2020 2020 Notes 2020 Total 2019 Total Income from: Charitable a¢tlvltles.' School fees receivable 18,810.170 18,810,170 20,729,771 oth6r educational income 3 352,893 352,893 654.884 Ancillary income Other trading activitles Non-ancillary trading income Investments Bank and other interest Voluntary sour¢es Donations and legacies Job retenlion scheme grant Total Income Expenditure on: Ralsing funds Financing costs Total costs of raislng funds Charltable a¢tivitie$ Education and grant making Total expenditure 746,289 746,289 1,744,439 130,351 130,351 113,498 5,118 5,118 6,015 21,728 2.338 24,066 22,753 953.702 953,702 21,020,251 2,338 21,022,589 23,271.360 141,291 141,291 20,533 (141,291) 1141,291) 120,533) (19.793,480} (19,793,480) (20,838.590) 19,934,771 20,859.123 19,934,771 Net income 1,085.480 2,338 1,087,818 2,412,237 Transfer between funds 15 Pension scheme actuarial {lossesl Net movoment In funds for the year Fund balances brought fotward at 1 September 2019 Fund balances carried forward at 31 August 2020 2,000 {2,000) 17 167,0001 (67,000 1426,000} 1,020,480 338 1,020,818 1,986,237 36,706,346 13,502 36,719,848 34,733,611 37,726,826 13,840 The notes on pages 18 to 37 form part of these financial statements. 14 37,740,666 36,719,848
DULWICH PREPARATORY SCHOOLS TRUST CONSOLIDATED AND CHARITY BALANCE SHEET AS AT 31 AUGUST 2020 Group 2020 Group 2019 Trust 2020 Trust 2019 Notes FIXED ASSETS Tangible assets 42,625,053 43,409,714 41,671,758 42,616,529 CURRENT ASSETS Debtors Cash at bank and in hand 10 1.198,358 2,878,919 4,077,277 861,668 1,806,462 2.668,130 482.954 606,655 1,089,609 84,500 129,680 214.180 CREDITORS: Amounts falling due within one year 11 (4,816,544) 15,436,198) {4,798,467} {5,445,086) NET CURRENT LIABILITIES 739,267 2.768,068 3,708,858 5,230,906 TOTAL ASSETS LESS CURRENT LIABILITIES CREDITORS: amounts falling due after more than one year 41.885,786 40,641,646 37,962.900 37.385,623 12 (3,616,120) 13,322,798) {3.582.355} (3,203.0391 NET ASSETS EXCLUDING PENSION SCHEME LIABILITY 38,269,666 37,318.848 34,380,546 34.182,584 Defined benefit pension scheme 17 529,000 (599,000 NET ASSETS INCLUDING PENSION SCHEME LIABILITY 37,740.666 36,719,848 34,380,545 34,182,584 CHARITY FUNDS Unrestricted funds excluding pension reserve 38,265.826 37,305,346 34,367,183 34,169,222 Pension reseNe Restricled funds TOTAL FUNDS <529,000) (599,0001 13,840 13.502 13,362 13,362 37,740,666 36,719,848 34.380,545 34,182,584 The notes on pages 18 to 37 form part of these financial statements. The parent charity result for the year ended 31 Augusl 2020 was a surplus of £213,76712019'. £2,062,269). The financial statements were approved by the Trustees on behalf, by.. 23 March 2021 and signed on their D H NELSON Chair of Board Company Number.. 579923 15
DULWICH PREPARATORY SCHOOLS TRUST CONSOLIDATED STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 AUGUST 2020 Note 2020 2019 Net cash inflow from operatlons Net cash provided by operating activities 1,134,661 2.452,012 Cash flows from investlng activities: Additions to fixed assets (excluding capitalised borrowing costs) Proceeds from sale of tangible fixed assets Investment income and bank interest received (584,750) 15,641.432) 598,828 1,272,859 5.118 6,015 Net cash providedl(used Inl Investlng activities 19.196 (4,362.558) Cash flows from financing actlvities: Cash inflows from borrowing Repayment of loan 8orrowing costs 300,000 1396,978) 15,578 1.000,000 {177,253) Net cash (used In}Iprovided from financlng actlvltles 81,400 822,747 Change in cash and cash equivalents in the reporting period 1.072,457 (1,087,799) Cash and cash equivalents at the beginning of period 1,806,462 2,894,261 Cash and cash equlvalents at the end of the reporting period 2,878,919 1,806.462 The notes on pages 18 to 37 form part of these financial statements. 16
DULWICH PREPARATORY SCHOOLS TRUST CONSOLIDATED STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 AUGUST 2020 2020 2019 {1> Reconciliation of net movement in funds to net ca$h flow from operatlng actlvities Net incoming reSoUrS Elimination of non-operaling cash flows.. Investment income Defined benefit pension scheme adjustments Depreciation and amortisation charges Interest charges (Profit) on disposal of fixed assets {IncreasellDecrease in debtors {Decreasel in creditors {excluding bank loans. fees in advance scheme and deposits} (Decrease) in fees in advance scheme creditors Increase in parents, deposits 1,087.818 2,412,237 (5,118) 1137,000) 1,242,743 83,287 1472.161) (336,6911 (6,015) {149,000) 1,345,536 (1.194.054) 61,247 {338,826} (32.062) 170.7791 81,388 (8.078) 22,201 46,843 39,775 Net Cash inflow from operatlons 1,134,661 2,452,012 2020 2019 (li} Analysis of cash and cash equivalents Cash at bank and in hand 2,878,919 1,806.462 17
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2020 1 ACCOUNTING POLICIES 1.1 Basis of preparatlon The financial statements have been prepared in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland {FRS102), the Companies Act 2006 and the Statement of Recommended Practice applicable lo charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102). The accounts are drawn up on the historical cost basis of accounting. The Trust is a Public Benefit Entity registered as a charity in England and Wales (charity number.. 312715) and a company limited by guarantee, {company number.. 005799231.lts registered office is 42 Alleyn Park, Dulwich, London SE21 7AA. The consolidated financial statements include the results of the Trust and its two subsidiaries, Dulwich Prep London and Dulwich Prep Cranbrook Itogether'the Group,). Accordingly, the Consolidated Statement of Financial Activities reflects the incoming resources and resources expended of the Group and not the Trust as an individual entity. 1.2 Golng Concern Having reviewed the cash position of the Trust together with the expected ongoing demand for places al the Schools and future projected cash flows, inoluding the ongoing effects of Covid- 19 and potential lockdowns, the Trustees have a reasonable expectation that the Group has adequate resources to continue its activrties for the foreseeable future and consider that there were no material uncertainties over the Group's financial viability. Accordingly, they continue to adopt the going concern basis in preparing the financial statements. 1.3 Critical accountlng judgements and key sources of estimation uncertainty In the application of the accounting policies, Trustees are required to make judgements, estimates, and assumptions about the carrying value of assets and liabilities that S not readily apparent from other sources. The estimates and underlying assumptions are based on historical experien and other factors that are considered lo be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accountrng estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affected current and future periods. The Group's liability for the Non-Teaching Staff defined benefit pension scheme involves a number of assumptions as disclosed in note 17. In the view of the Trustees, no other assumptions concerning the future or estimation uncertainty affecting assets or liabilities al the balance sheet date are likely to result in a material adjustment lo their carrying amounts in the next financial year. 18
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 1 ACCOUNTING POLICIES (continued} The following accounting policies have been applied consislenlly in dealing with items which are considered material in relation to the financial statements. 1.4 Income All income is included in the consolidated ststement of financial activities when the Group has entitlement to the funds, receipt is probable and the amount can be measured with sufficient reliability. Fees consist of charges for Ihe school year ending Au9USt, less bursaries and allowances. Fees received in advance are deferred and released to income in the period to which the fees relale. Grant income is recognised as and when entitlement arises. can be reliably quantified and the benefit is probable. 1.5 Expendlture Expenditure is accrued as soon as a liability is considered probable, discounted to present value for longer-term liabilities and has been included under expense categories that aggregale all cosls for allocation to activities. Where costs cannot be directly attributed to particular activities they have been allocated on a basis consistent with the use of the resources. 1.6 Tangible fixed assets Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rales calculated to write off the cost of fixed assets, less their estimated residual value, over their expected useful lives on the following bases. Fixed assets are capitalised if they exceed a non- trivial amounl in the context of the Trust's OT relevant School's operations being £500 in the case of the Trust and Dulwich Prep London and £200 in the case of Dulwich Prep Cranbrook. Freehold land Freehold property Lon9-term leasehold property Not depreciated Over 5 to 50 years Reducing balance over remaining life of the lease 25010 reducing balance 100/0 Straight line 25-50 /0 Straight line Motor vehicles Fixtures and fittings Computer equipment Borrowing costs directly attributable to capital development projects have been capitalised. 19
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 1 ACCOUNTING POLICIES {contlnued) 1.7 Fund accountlng Unreslricted income of the Trust belongs to the Trust's corporate reseNes, spendable at the discretion of the Trustees to further the Trust's objects. The unrestricted income of the Schools similaY belongs to the corporate reserves of the relevant school and is spendable at the dis¢relion of its Governors to further the school's objects. The objects of the Trust and the Schools contain provisions to provide support to each other. Where the Trustees or Governors las relevant) decide to set aside any part of these funds lo be used in future for some specific purpose, this is accounted for by transfer to the appropriate designaled fund. Restricled funds may only be spent on the charitable purpose specified by the donor. 1.8 Penslon costs Retirement benefits to employees of the Group are now provided through one defined benefit and bNO defined contribution scheme5. The pension costs charged in the Statement of Financial Activities are determined as follows.. la} The Teachers, Pension Scheme- This scheme is a MulteMploYer pension scheme. 11 is not possible lo identify the Group's share of the underlying assets and liabilities of the Teachers, Pension Scheme on a consislenl arKI reasonable basis and therefore. as required by FRS102, the Group accounts for the scheme as if il were a defined contribution scheme. The Group's contributions, which are in accordance with the recommendations of the Government Actuary, are charged in the period in which the salaries to which they relate are payable. Dulwich Prep Cranbrook left this scheme on 31 October 2019. {b} From 1 November 2019, Dulwich Prep Cranbrook teaching staff have become members of the Aviva Pension Trust for Independent Schools which as its name implies is operated by Aviva for a number of private schools. Employer's pensions costs are charged in the period In which the salaries to which they relate are payable. {cl The Dulwich Preparatory Schools Trust Non Teaching Staff Group Personal Pension Plan- This is a defined contribution group personal pension plan with A viva. Employer's pensions costs are charged in the period in which the salaries to which they relate are payable. 20
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 1 ACCOUNTING POLICIES (contlnued) In additlon the Trust has historically provided retirement benefits to non-tea¢hing staff through defined benefit scheme, The Dulwich Preparatory Schools Pension Scheme. The scheme is now closed so there are no current service costs, olher than administration expenses which are borne directly by the Schools. The expected return on the scheme assets less the scheme interest costs are credited within other interest. The heme actuarial gains and losses are recognised immediately as other recognised gains and losses. The defined benefit scheme assets are measured at fair value al the balance sheet dale. Scheme liabilities are measured on an actuarial basis at the balance sheet date using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent term to the scheme liabilities. The resulting defined benefit assét or liability is presented separately after other net assets on the face of the balance sheet. 1.9 Operatlng leases Rental income and expenditure under operating leases are accounted for on a straight-line basis over the lease term. even rf the payments are not made on such a basis. 1.10 Financial Instruments Basic financial instruments are initially recognised at transaction value and subsequently measured at amortised cost. Financial assets held al amortised cost comprise cash at bank and in hand, together with trade and other debtors. A specific provision is made for debts for which recoverability is in doubt. Cash at bank and in hand 1$ defined as all cash held in instant access bank accounts and used as working capital. Financial liabilities held at amortised cosl comprise all creditors except for fees received in advance, social security and other taxes and provisions. Administration and similar fees paid for borrowings are treated as interest and amortised over the life of the loans 1.11 Taxatlon The Trust is a registered charity No.312715 and as such is not liable to United Kingdom income tax or corporation tax on charitable activities. 21
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 2 FEES RECEIVABLE 2020 2019 Feos receivable conslst of: School fees Less.. total awards and concessions 19.890,600 1,080.430 18,810.170 21.873.720 1,143,949) 20,729.771 Included within awards and concessions are means-tested bursaries totalling £417,718 which were paid to 38 pupil$12019. £482,128 to 46 pupils). 3 OTHER EDUCATIONAL INCOME 2020 2019 Entrance and registration fees Courses and sub-lettings AVP sports activities income 43,090 244,414 65,389 352,893 35,180 430,963 188.741 654,884 4 ANCILLARY AND OTHER INCOME 2020 2019 School shop, School trips and Other income Profil on sale of fixed assets 274.128 472.161 746,289 550,385 1,194,054 1.744,439 5 OTHER TRADING ACTIVITIES 2020 2019 Rents receivable 130.351 113,498 22
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 6 ANALYSIS OF EXPENDITURE staff costs Depreclation Other costs Total 2020 Total 2019 (Note 71 (Note 9) Raising funds Financing costs 10,000 131.291 141,291 20,533 Total costs of raising funds 10,000 131,291 141,291 20,533 Charitable expenditure Teaching Welfare Premises Support costs 10,779,590 359.680 753,490 1,772.155 1,130,803 959,059 1,943.760 852,199 11.910,393 12,323,146 1,318,739 1,633,522 3,939,994 4,044,758 2.624,364 2.837.164 1,242,744 Total charitable expenditure 13,664,915 1,242.744 4,885,821 19,793.480 20,838,590 Total expenditure 13,674,915 1,242,744 5,017,112 19,934,771 20,859,123 Support costs include the followlng relatlng to governance 2020 2019 Trustee costs Legal and consultancy fees Remuneration paid to auditor for audit SeiceS 5.956 11,790 30,750 8.537 39,393 30,000 7 STAFF COSTS 2020 2019 The aggregate payroll ¢osts for the year were as follows: Wages and salaries Social security costs Pension costs and other benefits 10,741,109 10,775.710 1,061.542 1,063,299 1,872,264 1.452,626 13,674,915 13,291,635 23
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS {CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 7 STAFF COSTS (Cont•nuedl Aggregate employee-benefits of key management personnel amounted to £574.033 {2019'.£579,920} including pension contributions of £66,067 (2019.. £58,767). Number of higher paid employees in bands of.. £60.00110 £70,000 £70,001 to £80,000 £80,001 to £90,000 £100.001 to £110,000 £120,001 to £130,000 £150,001 to £160,000 The number with retirement benefi'ts accruing in Defined Contribution schemes was of which the contributions amounled to in Defined Benefit schemes was 2020 14 2019 50,157 16 13.706 11 One higher paid member of staff moved from defined benefit to defined contribution scheme in November 2019. The average number of the Group's employees during the year. calculated on headcount, was 2020 2019 201 218 49 52 81 74 331 344 Teaching Domestic and estates Administrative During the year there were redundancy or termination payments which amounted to £36.896 (2019.. £5,896} of which £nil was outstanding for payment at the year end. TRUSTEE COSTS AND RELATED PARTY TRANSACTIONS During the year, there was no re-imbursemernts lo Trustees in the year (2019.. £nill and no other amounts {2019'. nil) paid to Trustees. During the year 1 (2019.. 1) Trustee received re- imbursemenls of expenses for travel and subsistence lolalling £97 (2019.. £29}. During the year £30,000 {2019.' £25,000) was paid to M J Tiplady for consultancy related to the Trust's property portfolio and £64312019.. £1,025) for expenses for travel. The payments are rMitted under the Trust's governing document. In the year at Dulwich Prep London one Governor was re-imbursed for travel expenses £36 (2019-. 1 Govemor received £160). There was no reimbursement made to Governors in 2020 {£525 in 2019 paid to Mrs L M Davidson, a Governor of the School, for assistance in the assessment of children in Early Years). In the year at Dulwich Prep Cranbrook there were no re-imbursements for expenses for travel and Subsisten (2019.. £48). 24
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 9 TANGIBLE FIXED ASSETS Group Le888hold Land and Freehold Buildings proptrrty impTov&ments Furnitur Fixtures and Office Equipment Equipment Vehidès Total Cost At 1 Septernber 2019 Additions Disposals At 31 AugLSSt 2020 25,397,234 35.810,738 426,091 1,997,240 58,555 968.019 100,104 129,0171 123,2181 1,039,106 126,513 149,731 64,322,962 584,750 1182,373) 64,725.339 1130,138} 25.267,096 36,236,829 2,055,795 Deproelatlon Al 1 September 2019 Charged in year Disposals At 31 August 2020 7,942,850 561.275 13,4711 8,SOO,654 10,540,275 491,526 1,490,103 90,328 818,682 121,338 90,627 8,988 129,0171 123,218} 880.292 107.108 20.913,248 1,242,744 15S,7061 22,100,286 11,031,801 1,580,431 Nèt book values At 31 August 2019 Al 31 August 2020 17.454,384 16.766,442 25.270,463 25,205,028 507,137 475.364 149,337 158,814 28,393 19.405 43,409.714 42,625,053 Trust Freehold property Leasehold Land and Total Cost At 1 September 2019 Additions Disposals Al 31 August 2020 25,378,174 35,720,797 231,850 61,098,971 231,850 1130.1381 61,200.683 1130.1381 25,248.036 35,952,647 Dopre¢Tratlon At 1 September 2019 Charged in year Disp05als At 31 August 2020 7.942,287 560.894 {3,4701 8.499,691 10,540,175 489,059 18,482N42 1,049,953 13,4701 19,528,925 11,029.234 Net book valu8S At 31 August 2019 At 31 August 2020 17,435,907 16,748,345 25,180,622 24,923,413 42.616.529 41,671,758 At 31 August 2020 the Group had capital commitments of £330,98912019'. £0). 25
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 10 DEBTORS Group 2020 Group 2019 Trust 2020 Trust 2019 Fee debtors Sundry debtors Prepayments 131,297 700,426 366,635 1,198.358 198,541 237,434 425,693 861.668 366,667 116,287 482,954 84,500 84,500 11 CREDITORS: amounts falllng due wlthln one year Group 2020 Group 2019 Trust 2020 Trust 2019 Trade creditors Social security and other taxation Fees in advance Other creditors Fee deposits Amounts owed to subsidiaries Bank loan Accruals 330,973 259.062 1,697.146 283,028 1,463,154 429,800 275.577 1,681,931 328,872 1.381,766 58,055 71,657 5,725 5,915 4.133,584 285,436 315.667 4,798,467 4,331,549 662,866 373,099 5,445,086 285.436 497,745 4,816,544 662,886 675,386 5,436,198 12 CREDITORS: amounts falling due after more than one year Group 2020 Group 2019 Trust 2020 Trust 2019 Loans due within two to five years Loans due in more than five years Fees in advance 2,903,136 679,219 33.765 3,616,120 2,268,280 934,759 119,759 3,322,798 2,903.136 679.219 2,268,280 934.759 3,582,355 3,203,039 The Trusl's loan balance comprises drawings under facilities from NatWe51 Bank which originally totalled £5 million. The first is a fixed rate loan at 3.1401ts of which £3 million was drawn in June 2018. It was repayable in equal monthly instalments of £45,755 originally commencing in July 2019. The Trust was granted a 12 month repaymenl holiday for both facilities following the pandemic in May 2020 as a Consequen the loan is now due lo recommence, at the same rate, in April 2021 and end in June 2026., the amount required to repay the loan on 31 August 2020 was £2,661,567 (2019.- £2,865,905). 26
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 13 CREDITORS: amounts falllng due after more than one year Icontd) The second is a variable rate loan at 1.25'10 above base rate of which £1 million was drawn in November 2018 and a further £300,000 was drawn in November 2019. It was repayable by monthly instalments of £29,280, following the repayment holiday, the payments, at the same rate, will recommence in April 2021 and now end in October 2026., the amount required to repay the loan on 31 August 2020 was £1,233.228 (2019.. £1 million). No further drawings were permitted after November 2019 and there is no penalty for early repayment of either facility. The loans are secured by a charge over certain of the Trusfs residential freehold assets which have a nel book value of £2.25million and a market value of £6.15 million. 13 FEES IN ADVANCE Group Group 2020 2019 Fees in advance will be applied as follows: Within one to two years Within one year 33,765 1,697,146 1,730.911 119,759 1.681.931 1,801,690 Movements in Fees in advan Opening Fees in advance Amount released to income during the year Amount deferred during the year 1,801,690 1,809.769 11,681.931 } 11.774,8771 1.611,152 1,766,798 1,730,911 1,801,690 14 OPERATING LEASE INCOME AND COMMITMENTS At 31 August 2020 the tolal of future minimum operating lease income receivable under non cancellable operating leases amounted to.. Group 2020 Group 2019 Trust 2020 Trust 2019 Land and buildings within 1 year Land and buildings 2 and 5 years Land and buildings after more than 5 years 1,638.100 6.655,400 50,467,200 1,636,350 6,748,650 53,334,050 27
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 14 OPERATING LEASE INCOME AND COMMITMENTS At 31 August 2020 the total of future minimum operating lease commitments payable under non-cancellable operating leases amounted to.. Group 2020 Group 2019 Trust 2020 Trust 2019 Land and buildings within 1 year Land and buildings 2 and 5 years Land and buildings after more than 5 years 544,300 2.157,200 3.336,100 544.300 544,300 2,177,200 2,157,200 3.880,400 3,336,100 544.300 2,177,200 3,860,400 Other within 1 year Other between 2 and 5 years 183.054 274.922 162,303 345,537 The charge in the year was £725,61212019.' £663,809) for the Group and £543,300 (2020.. £545,452) for the Trust. The Trust signed a lease extension in September 2020 for the site al Dulwich Prep London. As a result of this the minimum operating lease commitments payable increased to £23,127,000 in September 2020. 15 SUMMARY OF MOVEMENTS ON MAJOR FUNDS At1 September 2019 Incoming resources Resources expended Gainsl {Loss) At31 August 2020 Transfer Group Unrestricted funds Restricted funds Total funds 36,706,346 21,020,251 119,934,771} {67.0001 2,000 37,726,826 13,502 2,338 12,000} 13,840 36,719.848 21,022,589 {19,934,7711 {67,0001 37.740,666 Trust Unrestricted funds Restricted funds Total funds 34,169.222 2,161,261 11,963,300) 34,367.183 13,362 13.362 34,182,584 2,161.261 1,983,300) 34,380.545 The comparative 2019 figures can be found in Note 21. A transfer of £2,000 (2019 £225) has been made during the year to reflect restricted income spent on Bursary awards12019 - musical instruments). 28
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 16 SUMMARY OF NET ASSETS BY FUNDS Unrestricted Funds Restricted Funds Total Funds Group Tangible Assets Net Current (Liabilities) l Assets Long Term Creditors including Pension Liability 42.625.053 1753.1071 14,145,120} 42,625.053 1739,2671 14,145,120) 13.840 37,726,826 13,840 37,740,666 Trust Tangible Assets Net Current (Liabilities) l Assets Long Term Creditors 41,671,758 13,722,220) (3,582,355) 34.367,183 The comparative 2019 figures can be found in Note 21. 41.671,758 13,708,858> 3,582,355 34,380.545 13.362 13,362 17 PENSION SCHEMES Current retirement benefits to employees of the Group are provided through one defined benefit schemes and two defined contribution schemes, which are funded by the Group and employees, Contributions. There is also a closed defined benefit scheme that operated for non-teaching staff. Deflned beneflt scheme Teachers, Pension Scheme Dulwich Prep London participates in the Teachers, Pension Scheme I'the TPS") for their teaching staff, Dulwich Prep Cranbrook participated in the scheme until 31 October 2019. The pension charge for the year includes contributions payable to the TPS of £1,201,184 {2019'. £1,115,007) and al Ihe year-end £132.70912019'. £150,702) was accrued in respect of contributions to this scheme. The TPS is an unfunded multi-employer defined benefits pension scheme governed by The Teachers, Pensions Regulations 2010 las 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 benelils are paid by public funds provided by Parliament. The employer contribution rate is set by the Secretary of State following scheme valuations undertaken by the Government Actuary's Department. The most recent actuarial valuation of the TPS was prepared as al 31 March 2016 and the Valuation Report. which was published in March 2019, confirmed that the employer contribution rate for the TPS would increase from 16.4010 to 23.6Yo from 1 September 2019. Employers are also required to pay a scheme administration levy of 0.08¥0 giving a total employer contribution rate of 23.68%. 29
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 17 PENSION SCHEMES (CONTINUED) The 31 March 2016 Valuation Report was prepared in accordance with the benefits sel out in the scheme regulations and under the approach specified in the Directions, as they applied at 5 March 2019. However, the assumptions were considered and set by the Department for Education prior lo the ruling in the 'McCloudlSargeanl case,. This case has required the courts to consider cases regarding the implementation of the 2015 reforms to Public Service Pensions including the Teachers, Pensions. On 27 June 2019 the Supreme Court denied the government permission to appeal the Court of Appeal's judgment that transitional provisions introduced lo the reformed pension schemes In 2015 gave rise lo unlawful age discnmination. The government is respecting the Court's decision and has said it will engage fully with the Employment Tribunal as well as employer and member representatives to agree how the discriminations will be remedied. A consultation was launched by the government on 16 July 2020, and closed to responses on 11 October 2020. As a result of the consullalion, the government announced on 4 February 2021 that il intends to proceed with a deferred choice underpin, under which members will be able lo choose either legacy or reformed scheme benefits in respect of their service during the period between 1 April 2015 and 31 March 2022, at the point they become payable. The TPS is subjecl to a cost cap mechanism which was put in pla to protect taxpayers against unforeseen changes in scheme costs. The Chief Secretary to the Treasury, having in 2018 announced that there would be a review of this cost cap mechanism, in January 2019 announced a pause to the cost cap mechanism following the Court of Appeal's ruling in the McCloud/Sargeanl case and until there is certainly about the value of pensions lo employees from April 2015 onwards. The pause was lifted in July 2020 and the government is preparing to complete the cost control element of the 2016 valuations, which is expected to be completed in 2021. In view of the above rulings and decisions the assumptions used in the 31 March 2016 Actuarial Valuation may become inappropriate. In this scenario a valuation prepared in accordance with revised benefits and suitably reMsed assumptions would yield different results than those Contained in the Actuarial Valuation. Until a remedy lo the discrimination conclusion has been deteimined by the Employment Tribunal il is not possible to conclude on any financial impact or future changes to the contribution rates of the TPS. Accordingly no provision for any additional past benefit pension costs is included in these financial statements. During the year the Governors of Dulwich Prep Cranbrook reviewed that school's membership of the Teachers, Pension Scheme as a result of affordability concerns raised by the 43Q/o increase in the employer's contribution introduced with effect from 1 st September 2019. Following a full consultation process an alternative defined contribution pension arrangement was offered which was accepted by all the staff involved. This new arrangement provides for employer contributions (inclusive of life assuran premiums) at the same level as the TPS prior lo 1st September. Dulwich Prep Cranbrook therefore withdrew from the Teachers, Pension Scheme and initiated the new arrangement with effect from 1 st November 2019. 30
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 17 PENSION SCHEMES ICONTINUEDI Following an increase in the employers, contribution lo the Teachers, Pension Scheme I'TPS") in September 2019. the Dulwich Prep London Governors commenced consultation on potential withdrawal from the TPS and ioining the Aviva Pension Trust for Independent Schools in April 2020. The consultation was concluded in January 2021 and the decision was made to leave the TPS with effect from 31 August 2021. Defined contribution scheme The pension cost charge in the year in respect of the defined contribution schemes was £600,695 (2019.. £236,415). The significant increase is a result of Dulwich Prep Cranbrook leaving the TPS on 31 October 2019. Non-teachin defined benefit scheme The Trusl operated this Scheme (the Dulwich Preparatory Schools Trust Non-Teaching Staff Pension Scheme), which was closed on 31 December. both in respect of new members and accrual for existing members. On 1 st September 2017 the Trust transferred the obligations to contribute to the Scheme to each of the Schools. The valuation in these accounts has been derived by projecting the results of the last comprehensive acluarial valuation of the Scheme as at 1 January 2018 and have been prepared by an independent qualified acturary. Group 2020 Group 2019 a) The amounts recognised In the balance sheet are as follows (2,881,000) 12.850,000) 2,352.000 2,251,000 Present Value of funded obligations Fair value of scheme assets Net (Liability) 529.000 (599,000) b) Changes in the present value of the defined beneflt obligallon Group 2020 Group 2019 Opening defined benefit obligation Interest cost Actuarial losses Benefits paid 2,850,000 51,000 39.000 59.000 2,328,000 60,000 478,000 116,000) Closing deh'ned benefit obligation 2,881,000 2,850,000 31
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED FOR THE YEAR ENDED 31 AUGUST 2020 17 PENSION SCHEMES (CONTINUED) c) Changes in the falrvalue of tho scheme assots Group 2020 Group 2019 Opening fair value of scheme assets Interest income Return in excess of interest income Contributions by employer Benefits paid Closing fair value of scheme assets 2,251,000 41,000 {28.0001 147,000 59,000 2,352.000 2,006,000 54,000 52,000 155,OCNJ 16,000} 2,251,000 dl The amounts included withln the Statement of Financlal Activities Group 2020 Group 2019 Interest on obligation Interest income Total amount charged to the Statement of Financial Acts'vrties 51,000 {41,(M)O) 60,000 {54.000) 10,000 6,000 Net actuarial (losses} recognised in the year (67,0001 (426,000) The Group expects to contribute £147.000 in 2019120. The e$ting obligations have been assumed by the Schools in proportion to their ongoing contributions as calculated by the Scheme Actuary following the triennial actuarial valuation as at 1 January 2018. el Principal actuarial assumptions at the balance sheet date 2020 2019 Financial Assumptions Discount rate RPI inflation assumption Rale of increase of pensions in payment Rate of increase of pensions in deferment 1.60 3.00 3.3Q 2.20 1.8Vo 3.5Q Assumed lrfe expectancy in years at age 65.. Non Pensioners Females Males Pensioners Females Males 25.4 23.4 25.4 23.4 23.9 21.9 23.9 21.9 32
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED FOR THE YEAR ENDED 31 AUGUST 2020 18 TRANSACTIONS WITH SUBSIDIARY ENTITIES The Trust received donaled staff time of employees of Dulwich Prep London totalling £48,618 (2019.. £63,605) recognised in the Trust ac¢ounls as a gift in kind. The Trusl also received rental income of £1.235,600 (2019.. £1,225,706) from Dulwich Prep London and £400,750 {2019'. £381.625} from Dulwich Prep Cranbrook. Cash resources for the Group are managed centrally by the Trust and as a consequence at 31 August 2020 £3,586,92712019.' £3.665,341) was due lo Dulwich Prep London and £546,656 {2019= £665,320) was due to Dulwich Prep Cranbrook. In 2019120 Dulwich Prep London donated £012019: £1.1 million) to the Trust,. this reflected surplus income genérated by the School. 19 POST BALANCE SHEET EVENTS The following significant events have occurred subsequent lo 31st August 2020.. The sale of the site at Cranbrook for which planning permission for residential development had been obtained and for which contracts had been exchanged on 7th August 2020 completed on 16th September. Gross proceeds of £1.425 million were received resulting in a net profit on the sale of £1.362 million. In September 2020 a 50 Year lease extension lo 2081 was signed with the Dulwich Estate in relation to the Trust's leasehold interest in property occupied by Dulwich Prep London. The signing of the agreement represented the culmination of an agreement reached, in principle, before 31 August 2019 and further secures the facilities for the long term benefit of Du1Ch Prep London. Under the terms of the agreement a premium of £1.1 million was payable to the Dulwch Estate in three tranches, the first tranche was paid in September 2020. the remaining two were paid in February 2021. 33
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS ICONTINUEDI FOR THE YEAR ENDED 31 AUGUST 2020 20 SUBSIDIARY ENTITIES Dulwich Pre London Registered office Company number Charity number 42 Alleyn Park, Dulwich, London SE21 7AA 10814894 1174356 Abbrevlated SOFA 2020 2019 Income Expenditure" Pension scheme actuarial {losses) Net movement in funds for the year Funds brought forward at 1 September 2018 Funds carried forward al 31 August 2019 14,658,903 (13,797.724) {15,300} 845,879 1.908,862 2.754,741 15,544,257 (15,499,209) (97,600 152,552} 1,961,414 1,908,862 Abbreviated Balance Sheet 2020 2019 Fixed assets Cash at bank Other assets Creditors.. Amounts falling due within one year Creditors.. Amounts falling due after more than one year Pension scheme liability 786.376 1,416,420 3,967,663 (3.260,8531 133.765) 582,189 640.021 4,079,193 (3.177,137) (78,204) {121,100) {137,2001 Net assets 2,754,741 1.908.862 Total Funds 2,754,741 1,908,862 Expenditure in 2019 includes the donations of £1.1 million to the Trust. 34
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 20 SUBSIDIARY ENTITIES {Continued) Dulwlch Pre Cranbrook Registered office Company number Charity number Abbreviated SOFA Coursehorn, Cranbrook, Kent. TN17 3NP 10815140 1174358 2020 2019 Income Expenditur8 Pension scheme actuarial {lossesl Net movement in funds for the year Funds brought forward at 1 September 2019 Funds carried foNard at 31 August 2020 5,886,966 (5,858.4041 51.700} (23,138) 628,520 605,382 6,535.122 (6,230,787) (328,400) {24,0651 652.585 628,520 Abbreviated Balance Sheet 2020 2019 Fixed assets Cash at bank Other assets Creditors.. Amounls falling du8 Wlthin one year Creditors.. Amounts falling due after more than one year Pension scheme liability 166.917 855.847 881.327 (890,809) 210,995 1,036,764 996,818 (1,112.702) 141,555) {407,9001 (461,800) Net assets 605,382 628.520 Total Funds 605.382 628,520 35
DULWICH PREPARATORY SCHOOLS TRUST CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2020 (Incorporating an income and expenditure account) 21 PRIOR YEAR COMPARATIVE NOTE {A} 2019 STATEMENT OF FINANCIAL ACTIVITIES Notes Unrestrlcted Funds 2019 Restricted Funds 2019 Total 2019 Income from: Charitable activities: School fees receivable Other educational income Ancillary income other trading activities Non-ancillary trading income Investments Bank and other interest Voluntary sources Donations and legacies 20,729.771 654,884 1,744,439 20,729.771 654,884 1,744,439 113,498 113,498 6,015 6,015 15,641 7,112 22,753 Total income 23,264,248 7,112 23,271,360 Expenditure on: Ral$ing funds Financing costs 20,533 20.533 Total costs of ralslng funds (20,533) (20,533) Charltable actlvities Education and grant making Total expendlture 120,838,590) 20,859,123 {20,838.590 20,859,123 Net income 2,405.125 7,112 2,412.237 Transfer between funds 225 {225) Pension scheme actuarial gains 19 (426.000) 1426,000) Net movement in fund5 for the year Fund balances brought foard at 1 September 2018 Fund balances carrled forward at 31 August 2019 1,979,350 6,887 1.986,237 34,726.996 6,615 34.733,611 36.706,346 36 13.502 36,719.848
DULWICH PREPARATORY SCHOOLS TRUST NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 AUGUST 2020 21 PRIOR YEAR COMPARATIVE NOTES ICONTINUEDI {B) 2019 SUMMARY OF MOVEMENTS ON MAJOR FUNDS At1 September 2018 £'ooo Incoming resources Resources expended £'ooo Gain$1 Losses Transfer At31 August 2019 £'ooo £'ooo £'ooo Group Unrestrlcted funds General reserve 34.726,996 23.264,248 (20,859,123} (426,000) 225 36,706.346 Restricted Total funds 6,615 34,733.611 7,112 23,271.360 225) 13,502 36,719.848 20,859,123 (426,000 Trust Unreslri¢led 32,114,065 Restricted funds 4,011,075 {1,955,9181 34,169.222 13.362 6,250 7,112 Total funds 32.120,315 4,018,187 11,95S,9181 34,182,584 ICI 2019 SUMMARY OF NET ASSETS BY FUNDS Unrestricted Restricted Funds Funds Tolal Funds Group Tangible Assets Net Current (Liabilities) l Assets Long Term Creditors including Pension Liability 43,409,714 12,781.570) 13,921,798> 43,409.714 12,768.068} 13,921.798) 13.502 36.706,346 13,502 36,719,848 Trust Tangible Assets Nel Current (Liabilrtiesl l Assets Long Temi Creditors 42,616.529 {5,244.2681 13,203,039) 34,169.222 42,616,529 (5.230,9061 3,203.039 34,182.584 13.362 13.382 37