Malvern Hills Trust Trustees, Report and Financial statements for the year ended 31st March 2024 info@malvernhills.org.uk I www.malvernhills.org.uk101684 892002 Malvern Hills Irust. ManorHouse.Gronge Road. Malvern.WorcestershlreWR14 3EY Mol¥ernHillsTrU5l￿the%￿[kin9n￿Me0f MofvernHillsCortserVot￿5. Reg15teredthtsrityno.S15804 Vot No.GB2758803 21 Malvern Hills Trust Trustees. Report and Financial statements For the year ended 31st March 2024 Contents Reference and administrative details Report of the trustees for the year ended 31 st March 2024 Independent Auditor's Report to the trustees of Malvern Hills Trust Statement of Financial Attivities for the year ended 31 St March 2024 Balance Sheet as at 31 st March 2024 6-24 25-28 29 30 Statement of cash flows for the year ended 315t March 2024 Notes to the financial statements for the year ended 315t March 2024 31 32-59 Malvern Hills Trust Reference and administrative details Charity number. 515804 (England and Wales) Principal office- Manor House Grange Road Malvem Worcestershire WR14 3EY Our advisors Independent Auditor: Alets Audit Services Epsilon House The Square Gloucester Business Park Gloucester GL3 4AD Banker Lloyds Bank plc 48 Belle Vue Terrace Malvern Worcestershire WR14 4QG Investment Managers: RBC Brewin Dolphin 9 Colmore Row Birmingham B3 2BJ Other Investments: Flagstone 1 St Floor Cloreville House 26.27 Oxendon Street London SW1Y 4EL The Charity Bank Ltd. Fos5e House 182 High Street Tonbridge TN91BE 50licitors= Whatley Recordon Solicitors 12 Worcester Rood Malvern Worcestershire WR14 4QU Veale Wasbrough Vizards LLP (VWV) Narrow Quay House Narrow Quay Bristol BS14QA Sharpe Pritchard LLP Elm Yard 10-16 Elm Street London WCI X OBJ Malvern Hills Trust Key management personnel - Senior Managers Chief Executive Officer Deborah Fox BSC, MA- Appointed 04.03.24 Helen Stace MA (Cantab). MA- Appointed 11.12.23 Resigned 20.03.24 Duncan Bridges Bsc (Hons) - Resigned 31.12.23 Alison Marlow BA (Hons), PGCert- Appointed 13.11.23 Secretary to the Board Susan Satchell Ll.B (Hons)- Resigned 31.01.24 Susan Satchell Ll.B {Hons)- Appointed 01.02.24 Jonathan Bills Msc Governance Change Officer Conservation Manager Operations Manager Finance and Administration Manager Peter Kelsall BScFor. MICFor Nicky Gutteridge Bsc (Hons), FCA- Appointed 12.02.24 Sarah Deacon BA (Hons) FCIPP MAAT AATQB- Appointed 30.05.23 Resigned 02.11.23 Cheryl Gentry Bsc ACA- Resigned 31.05.23 Trustees FAR- 5its on Finonce. Administrotion and Resources Committee LM- 5it5 on Land Monogement Committee GC- sits on Govemance Committee SC- sits on Staffing Committee has servedfor more than 9yea Elerted trustees Priory Ward: Dovid Watkins FAR (resigned 31 October 20231. Mary Turner FAR,. SC from 17 July 2024 lelected 7 December 2023) Mary Turner LM (elected 6 May 2022-31 Ortober 20231, Richard Fowler FAR (elerted 1 Novernbe¥ 2023) Rithard Fowler {elerted 2019-20231 LM to 10 November 2022. SC from 10 November 2022- Robert Berry FAR (elected l November 20231 "Chorles Penn FAR. Scto 10 November 2022 and from 18 November 2023. GC frorn 18 November 2023 Trevor Pa150ns LM (resigned 31 Ottober 2023).'John Raine FAR, SC, SC (elected 1 November 20231 'Richard Bortholomew FAR & GC to 10 November 2022. LMC from 10 November 2022 to 18th November 2023. FAR, SC, GC from 18th November 2023 Davtd Corc FAR & GC (Boord Vic&Chair from 18 November 20231 'Helerb Stace LM.SCto 10 November 2022. Gcfrom 10 November 2022 (iEsigned 20 Ortober 2023)," Allon Cottom FAR lelerted 1 November 20231 Stephen Braim LM & GC Iresigned 31 October 2023).. Felicity Robinson LM (elerted l November 2023) Dovid Fellows FAR & GC "Christopher Rouse LM Chase Ward: Wells Ward: West Ward: Dyson Perrins Ward: Malvem Link Ward: Pickersleigh Ward- Colwall Parish: Guarlford Porish: Mathon Parish: Nominated trustees Malvern Hills District Council: Paul Bennett (appointed 24 September 2024} Mick Davies FAR & SC (Boord Chair to 31 October 2023, resigned 31 October 2023) Mowk Diis(oll LM. OC froffl 10 July 2024 (oppointed 1 Novernber 2023) Malvern Hills Trust 'John Michael LM, GC IBoard Chair from 30 July 2024) Jeremy Owenson LM lappointed 1 November 2023 resigned 23.04.241 Cynthia Palmer LM & SC (Board Vice Chair to 18 November 2023, Board Chair from 18 Novembei 20231 Ii¥>iyiied 11 July 20241 Frances Victory LM & SC lappointed l November 2023) Molcolm Victory LM {appoinied 24 September 20241 3 vacancie5. Colwall Parish Council: Paul C]aybum LM & fjc from iolm November 2022 (resigned 3 July 20241 Mathon Parish Counal.. "David Boldwin LM & SC Church Cornmissioners: No longerappoint Herefordshire Council: Helen I'Anson SC Iresigned 5 October 20231 lohn Stock LM (appointed 28 November 20231 Sheila Wren LM. SC (appointed 28 November 20231 Worcestershire County Council- 'John Roine FAR. SC& GC (to 31 Ortober2023) Lucy Hodgson FAR Malcolm Vittory LM (appointed 1 November 2023, resigned 24 September 20241 Worcestershire County Council on behalf of the following porish&- Chris Atkins LM & GC (resigned 31 October 2023). Mike Wilkinson LM (appointed 1 November 20231 Duncan Westbury LM (appointed 14th December 20221 Michelle Alexander IM (appointed 12th April 2023. iesigned 27 FebTuary 20241 ca￿leMort0n. Newlond: Powick- Staff Throughout the year Malvern Hills Trust employed on average 21 staff (18 full time equivalent) (2022123: 21 and 17 full time equivalent). Details of staff numbers are given in note 11 to the financial statements. There were the following changes to the staff during the financial year 2023124. Katie McEvoy was appointed as Field Staff Member 11.04.23: Conor Wi5mott left as Worden 19.05.23: Cheryl Gentry left os Finance and Administration Manager 31.05.23: Sarah Deacon was appointed as Finance and Administration Manager 01.06.23 and left 02.11.23: Ben Taylor left as Warden 11.06.23: Angela Norton was appointed as Warden 27.06.23' Michael Price was appointed as Warden 05.07.23: Alison Marlow was appointed as Secretary to the Board 13.11.23: He5en Stace was appointed as Interim CEO 11.12.23 and left 20.03.24- Duncan Bridge5 left as CEO 31.12.23' Jill Hobkirk left a5 Gate Opener 10.01.24' Cindy Parish left as Administration Assistant 31.01.24. Susan Satchell left as Secretary to the Board 31.01.24 and was appointed as Governance Change Officer 01.02.24: Nicky Gutteridge wa5 appointed as Finance & Administration Manager 12.02.24: Leo Gleeson was appointed as Administration Assistant 20.02.24; Deborah Fox was appointed as CEO 04.03.24. Malvern Hills Trust Report of the trustees for the year ended 31" March 2024 The trustees are pleased to present their annual report together wlth the financial 5totement5 of the charity for the year ending 31 March 2024. The Board of Trustees resolved to adopt the working name of ' Molvein Hills TIu5t' on 19 January 2017. This came into effect on 6 April 2017. This name is registered with the Charity Commission. The statutory name remains ' Malvern Hills Conservators,. Malvern Hills Trust was set up in 1884 and is governed by The Malvern Hills Act5 1884, 1909, 1924, 1930 and 1995. It is a statutory corporation incorporated by private Act of Parliament and is a charity registered with the Charity Commission for England and Wales, number 515804. The financial statements comply with the Charities Act 2011, the Commissioners. Clauses Act 1847, the five Malvern Hills Acts and Accounting and Reporting by Charities." Statement of Recommended Practice (SORP) applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective January 2019). Our purposes and activities Malvern Hills Trust was set up to protect the hills and commons under its jurisdiction, in particular to: Preserve the natural aspett. Protect and manage trees, shrubs, turf and other vegetation. Prevent unlawful digging and quarrying, Keep the land open, unenclosed and unbuilt on a5 open spaces for the recreation and enjoyment of the public Malvern Hills Trust is also obliged under public legislation to conserve and enhance biodiversity. and to protect Site5 of Special Scientific Interest and Scheduled Monuments on its land. In order to meet its purposes, each year Malvern Hills Trust carries out a programme of conserrfation and maintenance work as guided by the adopted Land Management Plan htt :Ilwww.malvernh' er/land-management- lonl . This includes tree and woodland care. implementation of livestock grazing programmes. mowing and path maintenance to facilitate access, habitat restoration, litter picking and other general maintenance work across approximately 1,200 hectares (3.000 acre5) of multi-designated. nationally important landscape. Malvern Hills Trust Malvern Hills Trust provides and maintains a number of car parks for the public to use for easy access to the charity's land. Where parking charges apply. visitors can buy either a day or evening ticket at a meter or an annual parking permit. In planning and delivering its activities. the trustees have referred to the Charity Commission's guidance on public benefit. The trustees conf Irm they have complied with thelr duty In settion 17 of the Charitie5 Act 2011 to have due regard to public benefit guidance published by the Charity Commission for England and Wales. Under section 29 of the Malvern Hills Act 1884, Malvern Hills Trust may acquire 'for the purpose of preserving unenclosed and free from building any lands within 9 miles of Great Malvern Abbey (Priory) ........ which (they) may regard as proper to be so preserved as part of or in connection with the range of the Malvern Hills or for the purpose of maintaining any comrnon or commonable rights which may subsist over or affetting such lands,. Potential land acquisitions are considered by the trustee5. in accordance with the charity's Land Acquisition Policy. The trustees will consider acquiring a piece of land where the acquisition is consistent with the powers specified above and where acquisition would further the objectives of the charity. The criteria in the policy are: To own and protect the ridge of the Hills and the Steep slopes on either side, To own and protect land on the lower slopes which contributes to the landscape and setting of the Hills and Commons. To maintain common or commonoble rights. To keep land open for the recreation and enjoyment of the public, To consep4e habitats or species which are nationally or regionally scarce andlor are typical of the local area. To conserve feature5 of archaeological or geological interestlimportance. To improve access to the existing land holding for management and To divert public pressureldamaging activities away from over-used or sensitive areas of the existing land holding. Achievements and performance The Malvern Hills are an iconic and much-loved landscape, receiving an estimated 1 million visits each year. Malvern Hills Trust works closely with many user group5 and through its Recreation Advi50ry Panel seeks to understand their needs and minimise potential conflict between different users of the hills and commons. Malvern Hi115 Trust ha5 a responsibility to conserve the important features and special qualities of the hills and commons. including the geology, flora, fauna, landscape and archaeology. Keeping a balance between access and conservation is a major challenge for the charity. This is achieved through an active communications policy, using both local and social media and the charity's website. The Trust also alms to run a serles of free themed events each year for the public, to help inform their use and enjoyment of the Hills and covering all aspects of the charity's conservation work. Several of these events took place during 2023124. Malvern Hills Trust A 5-year Business Plan was adopted by the Board of Trustees in March 2022 and this is reviewed annually. Due to significant changes in Senior staff and preparation for the private bill during 2023124 this review did not happen, but is scheduled for later in 2024125. In particular. budgets have had to be adapted to take account of increases in prices (particularly fuel and energy) since February 2022. The Business Plan sets out the strategic priorities and plans for the charity. htt s:Ilwww.malvernhills.or .ukllookin -afterlbusiness- lanl Volunteers Before March 2020. Malvern Hills Trust received enormous support from the work of volunteers With attivities such as wardening. litter picking. recording flora and fauna, habitat management, conservation. archiving and administrative support. This all but stopped during the height of the pandemic Regular conservation volunteer working parties have resumed. The input from volunteers continues to be lower than pre-pandemic levels and the Trust looks forward to recruiting more volunteer wardens and office volunteers. The estimated volunteer contribution during the year was the equivalent of 378 (2022123: 307) working days (of 7.5 hours per day) spent on the hills and commons and 24 (2022123. 20) working days on office work The contribution of all volunteers is gratefully acknowledged. Use of Defra Stewardship Grants In 2023124 around 77 / (2022123" 75 Y ) of the charity's land was managed under the Department for the Environment, Food and Rural Affairs (Defra) Countryside Stewardship Scheme or Higher Level Stewardship Scheme. These schemes provide valuable funding for certain land management and conservation activities including grazing. which is the most effective way to maintain significant parts of the hills and commons. The grazing programme is complemented by a range of other management work carried out by staff, contractors and a dedicated team of volunteers. Six separate agreements are held {2022123; 5), and together they provide over £100.000 per annum toward MHT'S conservation activities. Key achievements During the year, the Trust has successfully undertaken maintenance work and implemented the Land Management Plan across its 1200 hectare (3000 acre) estate which includes open hills, woodlands and suburban green spaces. Local wildlife and heritage have been cared for ond over a fflillion visitors coming from far and wide have enjoyed the land. As part of thi5 work, staff have maintained over 70km of paths and 22 car parks to help facilitate public access. Other key achievements were: Public uccess 15 one of the twin puip05e5 of the TtU5t. In September, field staff and contractors installed 9 easy-to-use hond gates in several locations to either provide new Malvern Hills Trust public access or to replace stiles. A new bridleway bridge has also been installed connecting two fields and negating the need for people to walk on the road. Ponds are one of the focal features in the Trust's Land Management Plan. Works last winter saw four ponds around Castlemorton Common restored by removing built up sedimenL These ponds provide interest for walkers, a wonderful habitat and a drinking point for commoners, livestock. With tree diseases on the rise, the Trust ha5 had to spend a large sum of money on tree safety works this year. This in partly in response to Ash Dieback disease. Whilst the works went well and no incidents have been reported, unfortunately we now have another tree disease on the estate- Acute Oak Decline. This will further challenge our staff and resources in the future. The Trust successfully accessed grant aid to purchase several electric tools including a chainsaw. As well as providing essential kit for our day-to-day work this is further progress towards lowering our carbon footprint. Thanks to Defra's ' Farming in Protected Landscapes, for this grant help. Trust staff have submitted comments on a variety of planning applications which might affect Trust land and also managed several infrastructure installations by utility companies. Pupils from Malvern Wyche Primary School helped plant trees at All Saints Wood to improve species diversity. MHT has installed seating here and the site is now being enjoyed as a Forest School, hosting a variety of subjects. During 2022123 work was started to restore the stone bowl and pedestal at St Ann's Well, with the financial support from the Cadbury Foundation and Malvern Spa Association. Further work was carried out during 2023124 but the project will not be completed until 2024125 due to time constraints on both our staff and the contractor. The balance of the cost of undertaking this project is funded from the restricted gifts fund. Meeting the challenges of managing day to day activity with some significant senior Staff changes. A new permanent CEO. Secretary to the Board and FAM are in place. The wet weather of winter 23124 delayed many Trust projects and created new work in the form of dealing with several holes and slumps that appeared over the estate due to water leve15. Several of these had to be cordoned off as dangers to the public and work The Trust was able to conduct its elections in November 2023 In accordance with the Acts thanks to significant assistance from the Electoral Services staff at Malvern Hills District Council. There has been a concerted effort on improving trustee and staff interactions. The Staff Trustee Protocol Working Group was a particular highlight with a new procedure noted by the Board in May along with a referral form for trustee questions that cannot be routed to the Trust's information line. The Land Management Committee provided Iwo informotive wolks in 2024 at West of England Quarry and Old Hills led by the COnser￿ation Manager and team. to illustrate and gain a shared understanding of Malvern Hills Trust current challenges for Trust operations. A new social group has formed. A new trustee and staff Health & Safety Group is being instigated to develop a new policy statement and policy and addie55 kiigh level compliance. Structure, Governance and Management The Malvern Hills Trust is a body corporate set up under the Malvern Hills Act 1884. and governed by that Act as well as the Acts of 1909, 1924. 1930 and 1995. It is a registered charity. The Board of Trustees is the decision-making body. The governing legislation currently provides for 29 trustees who are appointed for a four-year term. Eleven trustees are directly elected under the Local Elections (Principal Areas) Rules by the residents of the wards (as at December 2022) and parishes listed below. who contribute to Malvern Hills Trust through a levy paid with their Council Tax. The Chief Executive Officer is the Electoral Returning Officer. Electoral area Seats Priory Ward Chase Ward Wells Ward West Ward Dyson Perrins Ward Malvern Link Ward Pickersleigh Ward Guarlford Parish Colwall Parish Mathon Parish The remaining 18 trustees are nominated by the following bodies: Herefordshire Council Worcestershire County Council Worcestershire County Council on behalf of the parishes of Castlemorton, Newland and Powick Malvern Hi115 District Council Colwall Parish Council Mathon Parish Council The Church Commissioners Most of the current trustees took up their seats on 1 November 2023 (some trustees were appointed after that date) and will remain in place until 31 October 2027. There were 7 vocancies (all foi exteinally appointed trustees) at the time this report wa5 approved. Following appointment, trustees underwent an intensive period of training to ensure that they under5Land thei[ dutie5 ond iespon5ibilities under the Malvern Hills Acts, their responsibilities as charity trustees and their duties under other legislation which affects the land which they 10 Malvern Hills Trust manage. In particular there were a number of training sessions to ensure that new trustees were fully familiar with the Trust's proposals to update its governing Acts. A short tour is also offered to view some of the key management sites and trustees are encouraged to attend land management site visits throughout the year. Board and Committee meetings are open to the public and dates are published on the website. The Board holds six scheduled Board meetings in January, March. May, July, September ond November to make decisions and to receive reports from officers. committees and from representatives serving on outside bodies. There is also an opportunity for members of the public to make statements. The number of scheduled committee meetings has been reduced but Special Meetings are held whenevei required. The annual meeting at which the financial statements are adopted, and Auditor appointed was held on 19 October 2023. It was resolved at that meeting to re-appoint Azets Audit Services for the year ended 31 March 2024. and the Trustees, Annual Report and Accounts for year ended 31 March 2023 were approved. The Chair and Vice Chair are elected at the Board's annual meeting in November, at which committee members and representatives to serve on outside bodies are also appointed. Cynthia Palmer (chair) and David Core (vice chair) were appointed unopposed at this meeting. During the Board meeting on 11 July 2024 Cynthia Palmer resigned as Chair. John Michael wa5 appointed as new Chair at a Special meeting on 30 July 2024. He will remain in post for the remainder of the Board year to 31 October 2024. Chief Executive Officer The Chief Executive Officer is responsible for the day-to-day management of the charity's affairs and for implementing strategies and policies agreed by the Board of Trustees. As noted in the reference and administration page. this financial year has seen three different CEOS in post. Duncan Bridges resigned as CEO effective from 31 December 2023. Helen Stace replaced him on a temporary basis until Deborah Fox took up her appointment as the Trust's new CEO on 4 March 2024. The new CEO has settled into her role quickly and effectively. building confidence amongst staff and trustees. They ensured that the public consultation on taking the Trust into the 21st Century was launched in a timely and effective manner and have provided numerous comments to the media. She has formed new relationships with parish. town and district councils and made introductory presentations to many of them. She has met numerous 5tokeholders and trialled new collaborative approaches. She sponsored the new staff trustee protocol project to realise the maximum benefit of the new procedure. She has also acted swiftly on a number of risk, health and safety related issues that could have unnecessarily exposed trustees. Malvern Hills Trust Comrnittees There are five committees of the Board. Their functions are set out below. The Board of Trustees considers committee reports and adopts. declines or amends their recommendations at the following Board meeting. Land Management Committee This committee considers land management issues and strategy, including the statutory duty to maintain the natural aspect. This includes: Overseeing production of the Land Management Plan and monitoring progress against the plan Recommending the annual land management budget to the Board and monitoring progress against the budget Reviewing policies relating to the management of the charity's land holding, Consideration of some applications for easements and wayleaves ond making recommendations to the Board thereon Considering appropriate levels of access infrastructure. interpretation and information Reviewing funding agreements, licences etc relating to the management of the hills and commons Considering and making recommendations to Board regarding policy and best practice relating to environmental and sustainable development practices, (such as management of ash in light of Ash Diebock disease) Finance, Administration and Resources Committee This committee has oversight of the following areas: Finance, including reviewing the adequacy of financial controls, annual financial statements, budgets and budget monitoring Investments, including reviewing the Investment Manager's reports and performance Overseeing production of the business plan and monitoring progress against the plan Administration, including legal matters and review and enforcement of the byelaws Rents and charges Reviewing major contracts Ensuring that Malvern Hills Trust has appropriate levels of insurance cover Fundraising The committee also has authority to approve unbudgeted expenditure within ogreed limits. Governance Committee The Governance Committee has oversight of and advises the Board on the following areas: Ensuring the organisation complies with the Malvern Hills Arts. charity legislation and other relevant legislation relating to governance Reviewing board and committee performance 12 Malvern Hills Trust Reviewing and monitoring compliance with the Governance Handbook, Standing Orders and the Code of Conduct Ensuring that the charity has appropriate risk management systems in place and that risks are reviewed and updated annually Approving training for trustees Staffing Committee The Cornmittee makes recommendations to the Board of Trustees regarding: Staffing and office requirements Policy matter5 relating to staff salaries and benefits Budget allocation for personnel and health and safety Policy matters relating to terms and conditions of employmenuengagement for all staff and volunteers Matters arising from Malvern Hills Trust's Disciplinary and Grievance procedures for staff Health and safety and first aid matters in relation to staff, volunteers and members of the public Pension arrangements with the Finance Administration and Resources Committee The Cornmittee also: Reviews all employment and human resources policies and procedures and ensures that Malvern Hills Trust acts as a good employer Receives reports from the Chief Executive Officer on human resource matters Ensures that Malvern Hills Trust has a Health and Safety Policy and Health and Safety management systems in relation to staff, volunteers and members of the public and that these are reviewed regularly. properly implemented and the Board of Trustees is kept fully informed Disciplinary Committee The Committee meets as and when required to consider breaches of the trustee Code of Conduct. Charity Governance Code The Charity Governance Code was first published in July 2017 and revised in 2020 as o reference document to help charities work towards effertive governance and the right leadership structure. The Code sets out principles and recommended practice. All charities and their trustees are encouraged to meet the principles and outcomes of the Code by either applying the recommended practice or explaining what they have done instead or why they have not applied IL As a charity governed by statute, including legislation which is now over 175 years old. it is not possible for the Trust to follow many of the recommendations for good practices Set out in the Code but the Code been used to has formulate many of the proposals for modernisation of the Tru5t'5 constitution. During the past 18 month5. the Trust has used the associated Malvern Hills Trust 'Governance Toolkit. as a means of assessing trustees, and Senior Staff's views on current governance arrangements with the aim of identifying and agreeing areas for improved governance. The Charity Governance Code states that if a trustee has served for more than 9 years their appointment should be subject to a particularly rigorous review, taking into account the need for progressive refreshing of the Board and should be explained in the trustee5' annual report. There is nothing in the Acts which prevents a trustee from standing for office for more than 9 years and. because of the appointments procedure. nothing which the Trust can do to prevent appointment of trustees who have been on the Board for more than 9 years. Trustees who have Served for more than 9 years (listed in order of longest serving) are: Christopher Rouse (first elected November 2003) David Baldwin- first appointed May 2010 John Raine- first appointed September 2013 Richard Bartholomew- first elected March 2015 Charles Penn- first elected November 2015 John Michael - first eletted November 2015 Ward boundary changes The Malvern Hills (Electoral Changes) Order 2023 caused significant concern for the Trust as it altered the boundaries of Local Government wards in central Malvern. The Trust's electoral area is (in part) def ined in the Acts as "the seven wards of the urban district of Malvern", The current wards no longer coincide with the old electoral boundaries. The Trust was able to conduct its elections in November 2023 in accordance with the Acts thanks to significant assistance from the Electoral Service5 Staff at Malvern Hi115 District Council. This situation is not satisfactory and highlights the urgent need to modernise the Trust's governing legislation to keep pace with changes to public legislation over the years. The Trust requested that the Department of Levelling Up Housing and Communities make an Order to effect consequential amendments to the 1924 Malvern Hills Act, without success. Modernisation of the Trust's constitution The Trust is governed by the five Malvern Hills Acts, which reference other public Acts. dating back to 1847. The Trust needs to rationalise. modernise and consolidate its governing legislation. The current Acts do not reflect or permit modern best practice in relation to charity governance and do not contain all the powers that the trustees need to administer the charity in the most effectlve way and to best achieve its objects. There are provisions in the Acts that no longcr apply, others which reflect a legal and cultural context that no longer exists and Malvem Hills Trust some of the key provisions are defined by reference to bodies which were abolished 50 years ago. Because the Acts are out of date, they hamper the Trust's ability to operate effectively and to provide good value for money. The Trust began work on its proposals for updating the Acts in 2014. The Trust was initially advised to apply for a Parliamentary Scheme under s73 Charities Act 2011, but following a public consultation in 2019, the Trust wa5 advised in 2020 by the Charity Commi55ion and Department of Digital Culture Media and Sport (DCMS) that "changes to the charity's governing documents would now be best handled via a private bill." The Trust obtained consent from the Charity Commission in August 2023 to expend up to £306.000 on the preparation and promotion of a Bill in Parliament. This permission was subject to a condition that the Trust did not seek to extend or materially change the existing power to levy. Work on the Bill did not start in earnest until the trustees who had been appointed in November 2023 had undertaken intensive training so that they were fully aware of the problems with the existing Acts and the Board's proposals to update them. It was resolved in lanuary 2024 to seek a Private Bill, with a view to depositing the Bill in November 2024. The proposa15 are little changed from those upon which the Trust consulted in 2019, but given the time which has elapsed. the Trust ran a second public consultation from 22 May to 22 luly 2024 and also consulted key stakeholders once again. The Trust has also received permission from the Charity Commission to spread the cost of the Bill by taking a loan of up to £306.000 from the Land Purchase (1992) Fund. This loan is to be repaid over a term of 25 years at a fixed rate of 6 Y per annum. No funds were drawn down pursuant to the loan arrangement during the financial year ending 31 March 2024. No funds have been drawn down since the year end up to the date of signing this report. Financial Review The financial results are set out on pages 29 to 58. There was a total net increase in funds of E258,645 (2022123 increase of £1.419.600). Net income before transfers on the unrestricted funds was £64,918 (2022123 net expenditure of £23,485). The net movement on the unrestricted funds after transfers and the FRS 102 pension adjustment was an increase of £167,008 (2022123 inflow of £1,539,792). In addition, there was a net inflow of funds on the restricted funds of £91,637 (2022123 net outflow El 20,192). Total reserves at the financial year end were £ 3,855.317 (2022123 £3,596,672), of which £3,091,034 is restricted (and of which £1.346.835 is inalienable) (2022123 £2,999,397 restricted (and of which £1,346,835 is inalienable). Further information regarding inalienable assets is in notes 1 g and 1 h. Malvern Hills Trust Principal sources of funds Under powers in the Malvern Hills Acts, Malvern Hills Trust charges a levy to Council Tax payers in the Parishes of Malvern, Guarlford, West Malvern, Malvern Wells, Colwall and Mathon. The average band D levy payable in 2023124 was £45.34 (2022123 it was £41.34). The total levy received by the charity was £663,800 (2022123 £595,300). Malvern Hills Trust is very grateful to the levy payers for thi5 funding and recognises its importance in helping the Trust to maintain the hills and commons. Information for levy payers can be found on the website htt s:Ilwww.malvernhills.or .ukllivin -inlle ersl Revenue from car parks is the second main funding source. The total received in 2023124 wa5 £398,720 (2022123 £360.753). Car park takings are used to fund the charity's work generally including maintaining the car parks for public use. Agri-environment grants, most significant of which are those from Countryside Stewardship Scheme. are the third largest source of funds. £148.536 was received in 2023124 (£106,612 was received in 2022123). An additional sum of £59,673 for the year ended 315t December 2023 (2022123 £51,172) was received by the CS Castlemorton Delivery Group which is accounted for as custodian funds under the terms of the Countryside Stewardship Scheme. The entire income and expenditure of this delivery group does not form part of the Malvern Hills Trust accounts, but rather the applicable share, as agreed via the required internal agreement. In 2023124 this amounts to £1,000 admin fee (2022123 £1,000) and £5.098 non grazing delivery services12022123 £4.667). Donations and legacies received totalled £18,243 (2022123 - £13,879). Significant financial impacts Significant events (and their financial impact) during the year were: Car park cash takings exceeded budget and last year's figure5, despite the overall poor weather during the year. Car park pass income (levy payers and non-levy payers) has been adjusted this year to include income in the month it relates, rather thon when paid which has resulted in an accounting adjustment. This has resulted in o £16.934 less income this year as it has been deferred to 2024125. The Trust has a 5-year programme for managing Ash Dieback. Anticipated spend on this ha5 not been os high as was anticipated at £38,614 (2022123 E34,558) but we now face managing Acute Oak Decline which will require funds going forward. The balance of the designated fund is currently healthy as a result of prior year transfers made to cover future costs. No additional funds were deemed necessary to designate this year. The Board maintained its policy of updating vehicles with purchases of a compact tractor, quad bike and trailer in the year. Total vehicle and equipment additions were £71,891. The cost of the elcttion process in 2023 was £26,730 leaving the fund in deficit at 31.03.24. General Funds will cover this as at 01.04.24 by way of transfer. The overspend was primarily due to the fact that we had both an election and a bi-election 16 Malvern Hills Trust during the year and there were 3 contested seats. Costs have also increased as we need to check ID at polling stations. Bulld of a shed in Colwall at a cost of £41,095. Recruitment of senior staff including the CEO. Secretary to the Board and Finonco and Administration Manager. Costs attached to the preparation and promotion of a Private Bill. 2023124 costs were in the region of £18,000 und continue in 2024125. Long delays in the RPA payments making cashflow more difficult to manage. A large increase in the RPA for the 2024 calendar year that was not expected but will not be received until 2025. We are recognising the income in line with the agreement but prudently not making plans for spending the cash until receipt. Acknowledgements: other grants and contributions Malvern Hills Trust gratefully acknowledges the f inancial support of Defra Rural Development Programme for England, Worcestershire County Council, Herefordshire Council, Malvern Hills District Council. Malvern Civic Society, and the Farming in Protected Landscapes scheme run by the Malvern Hills Area of Outstanding Natural Beauty (AONB) partnership. Investment powers and policy The trustees have wide powers of investment. The Trust has placed the Land Maintenance Fund. Parliamentary Fund and the majority of the Land Purchase (1992) Fund. under investment through RBC Brewin Dolphin. The trustees have provided RBC Brewin Dolphin with written investment policies for the portfolios, which are reviewed annually. In all cases. the Trust seeks to produce the best financial return with a moderate level of risk. The Finance, Administration and Resources Committee. with the advice of the Trust's Investment Manager, is charged with recommending to the trustee5 a suitable asset allocation strategy, with the aim of achieving the charity's investment objectives. RBC Brewin Dolphin's risk category 6 index was used for the structure of the above two portfolios (in place at the start of the year) and provides a ready measure of its performance. The Trust's investment policies provide that the asset classes which the trustees consider could be included within the portfolio are cash, fixed interest products. equities, commercial property, private equity. commodities and any other asset that may be agreed to be suitable for the charity. Access to these asset classe5 can be achieved directly or via collective investment vehicles such as unit or investment trusts. No single direct equity investment should exceed 5 Yo of the total value of the portfolio and no single investment in a collertive fund should exceed 10 % of the value of the portfolio. Investments in negotiable instruments known a5 'derivatives' are not permitted without prior opproval of the trustees. The trustees acknowledge that in order to manage longer term inflation risks, investmcnts will portly be in assets such as equities and as a result. in the short-term th@ copitol values could flurtuate. 17 Malvern Hills Trust The Trust's investment objective for the Land Maintenance Fund and the Parliamentary Fund (Parliamentary portfolio) is to produce the best financial return (capital growth and income) with a moderate level of risk. The Trust's principal objective for the investment of the Land Purchase (1992) Fund (Land Purchase (1992) portfolio) is to generate a return (net of costs, including reinvestment of earnings) sufficient to maintain the purchasing value of the fund. The trustees propose funding a significant percentage of the cost of pursuing the Trust's governance changes by way of a loan from the Land Purchase Fund. A similar mechanism was used to fund the passing of the Malvern Hills Act 1995. Anticipating drawing down part of the Fund, trustees voted in January 2023 to move that part to lower risk investments in order to avoid the risk of fluctuations in the value of the investments at a time they were needed. The Board resolved to split the Land Purchase Fund into 3 parts. £150,000 to be invested as cash in FSCS assured interest bearing accounts and £200,000 to be invested by the Trust's Investment Managers in a separate. risk category 4 portfolio (Land Purchase (1992) No2 portfolio). The balance remains invested in accordance with the original Investment Policy. There were no changes to this during the financial year. Investment performance Inflation continued to ease from record highs over the last 12 months. while interest rate5 remained at restrittive levels. Tensions in the Middle East and the Red Sea resulted in higher shipping cost and oil price volatility. threatening to derail inflation on its path back down to central bank target levels. However, bond and equity markets rallied towards the end of 2023 as further progress on inflation was made across developed economies, leading to interest rate cut speculation in 2024. The first quarter of 2024 saw the Technology sector soar to all- time highs. driven by the Artificial Intelligence narrative, which provided a supportive backdrop for large-cap equity investors. Over the financial year to 31 March 2024, the combined portfolio generated a total return of +9.76 A net of fees. This compares to the Asset Risk Consultants (ARC) Steady Growth Index performance of +9.38 Y (net of fees) and the RBC Brewin Dolphin Risk Category 6 Strategic Asset Allocation of +13.39°A (gross of fees). The ARC index is made up of around 5.000 charity portfolios from 35 different investment managers. providing a good comparison to the performance of sector peers with a similar level of investment risk. The annual return5 (year ended 31 Mulch 2024) were as follows- Land Purchase (1992) Fund (main portfolio) Return gross of fees +12.39 %, net return +11.66'A (ARC Steady Growth 9.38 / ) Land Purchase (1992) No. 2 portfolio (established 20th February 2023) 18 Malvern Hills Trust Return gross of fees +8.21 % A. net return +7.59 / (ARC Balanced asset 7.22 / ) Parliamentary and Land Maintenance portfolio Return gross of fees +10.05°A. net return +9.3 Y (ARC Steady Growth 9.38 / ) The trustees receive o full report on the investment portfolios from RBC Brewin Dolphin in June and December and an interim report is available in March and September. The Trust's assets are invested in line with the long-term interests of the charity. Malvern Hi115 Trust exists to protect the Malvern Hills and commons. Climate change poses a threat to the unique environment which is cared for by the Trust. Since 31 March 2021 the trustees have excluded all fossil fuel, mining and quarrying companies from the investment portfolios. The trustees also exclude individual investments which are perceived to conflict with the charity s purpose. Reserves policy and going concern Malvern Hills Trust's (MHT'S) free reserves are defined as those funds which the charity has available to spend on its charitable objectives. The free reserves are calculated by starting with the total unrestricted funds value from the accounts. To comply with accounting rules the amount of the pension deficit is included as part of the unrestricted funds shown in the accounts. although it is a liability that will not crystallise. as the deficit to be repaid is part of a different calculation under the triennial valuation of the scheme. This deficit value is therefore added back when calculating the free reserves. The net book value of fixed assets (not available as cash) and the value of committed (designated) funds are then deducted. to come to the free reserve total. In summary. the calculation is as follows: Total unrestricted funds" Less: The defined benefit pension scheme surplusl(deficit) Net book value of fixed assets funded from the general fund Committed designated funds 'Unrestricted funds comprise the general fund, and free designated funds and 5urplusl(deficit) on the defined benefit pension scheme The level of free reserves and cash balances are reviewed quarterly against the agreed policy. That policy is reassessed annually. The level of free reser￿eS required will vary from time to time depending on MHT'S overall financial position, the economic climate, the security of income from grants and other sources (in particular from parking revenue), the expected levels of planned expenditure and the risks of unplanned costs. 19 Malvern Hills Trust In setting the policy. the trustees have ensured that the contributions required under the defined benefit pension scheme, including those to cover the actuarial deficit. can be met from projecled cash flows. MHT'S trustees, policy is to aim to maintain the free reserves level above £350,000. This threshold has been set by the trustees taking Into account the following factors: The need to hold funds to maintain the viability of MHT in case of unexpected events leadlng to uninsured costs. The need to provide protettion against the Tisk of a significant drop in grant or other income or unexpected delays in receipts. To fund everyday essential expenditure in the event that income streams are unexpettedly interrupted, To fund unplanned costs arising from tree diseases, The need to provide working capital for MHT, both for day to day work and for future (possibly grant-f unded) development, The need to provide a degree of protection against fluctuations in investment income. The policy was adopted in June 2018 and updated in August 2023. At 31 March 2024 total funds of the charity were £3,855,317 (2022123 £3,596,672). This included restricted funds of £3.091,034 (2022123 £2,999,397) and committed designated funds of £897,153 (2022123 E897.687). Details of all the designated funds are given in note 20 to the financial statements and restricted funds details are in note 22. The level of free reserves as defined above was £742.341. made up of the following: General fund excluding net book value of assets £335,085 Free. designated funds Gifts £389,386 Fundraising £10,000 Car park repair £4,369 Dog campaign £3,501 Total £742,341 The total of the free reserve was slightly up on the March 2023 figure (£736,620). The overall free reserve remalns higher than the target minimum of £350,000. A piopoition of thc reserve from 1 April 2024 has become part of the budget to fund the costs relating to the Private Bill preparation and consultation during 2024125. 20 Malvern Hills Trust The Ash Dieback fund is currently looking like it will be more than sufficient in the short term. last year there were some concerns that tackling Ash Diebock could cost more than was first anticipated. The trustees have carried out a going concern review and concluded that the Trust is a going concern ond that they expect the organisation to continue operating and paying Ilabllltles as they fall due for at least twelve months from when the accounts are signed. Pension scheme FRS 102 Malvern Hills Trust is a member of the Worcestershire County Council Pension Fund (WCCPF), which is a defined benefit scheme. The costs and liabilities shown in these financial statements are accounted for under FRS 102. with details being given in note 27. The pension figures reflected in these financial statements have been provided by Mercer, the Actuary to the Fund. The FRS 102 accounting deficit at the year-end has been calculated as £612.000 (2022123 £737,000). The employer's contribution rate during the year was 21.8'A (2022123 21.8 / ). Triennial valuation The most recent triennial Actuarial valuation was carried out at 31 March 2022. This valuation provides the basis for the calculation of future contributions to WCCPF. The Trust's deficit (that is the excess of pension liabilities over assets) in WCCPF as at 31 March 2022 was £802,350 (74.8 / funding level). This was an improvement on the position at the last two triennial valuations which showed a deficit in 2019 of £926,000 (69 A funding level) and £1.092,000 (57 / funding) in 2016. The next Actuarial valuation will be carried out as at 31 March 2025, with revised contribution rates coming into effect from 1 April 2026. The Trust receives a schedule of contribution rates from the Actuary following each triennial valuation, cornprising a rate to support on-going benefits and a deficit recovery element. The Business Plan and budgets include provision for these payments. The deficit recovery period following the 2022 Actuarial Valuation is 12 years. The deficit payments in 2023124 totalled £74,200 (2022123 £68,700). The amount due for 2024125 is £77,630. In July 2016 the Board closed WCCPF to new joiners, following a review of pension provision. In order to meet its obligations under auto enrolment legislation, new employees ore enrolled in the People'5 Pension, which is a defined contribution scheme. The employer's contribution rate to this scheme is 10 Yo of pensionable salaries. Plans for future periods The CEO and Senior Management have met regularly and forged a greater understanding of each other's functions. There ha5 been much progress against recommendations from the staffing review and this will continue. The business plan will be revisited and a new Health and Safety plan Is expected to arlse from new insight provided by a retained Health & Safety advisor and fire risk assessments. Following discussion at FAR, the Board will be supported in 21 Malvern Hills Trust an annual review of the Risk Strategy. There is considerable improvement in day to day trustee and staff relations and the Staff Trustee Protocol Working Group was a particular highlight with a new procedure noted by the Board in May. The communications output has been high with numerous news releases and social media posts. The Trust's Facebook channel has 5.2K followers and peaks in activity occurred around the May well dressing, May car polk pa55 opplication5 opening ond Moy lounch of the public consultation. Stockwatch continues to be popular with a regular slot in the Malvern Gazette. Over 13.000 leaflets and hundreds of posters were circulated for the public consultation in the Trust's usual look and feel with regular updates to frequently asked questions and a myth- busting section on the website. This was aided by an operational trustee and staff communications group. Conservation For the next financial year and until 2026. the Trust's outdoor work will be focused on the delivery of the Land Management Plan 2021-2026 and responding to new challenges that may arise on the estate. Our priorities will always be the most important. legally designated features such as Britlsh Camp hillfort. This nationally important archaeological monument needs annual livestock grazing and scrub control to keep it open and visible. Presently it also need5 Structural repair works on two significant erosion scars. This work will be carried out soon by our field staff team using sympathetic techniques. Maintaining our priority habitats that make up much of the estate and bring benefit to thousands of people every week. need annual works to keep them in good condition. Hedges. ponds, meadows, ancient woodlands all rely on the hard work of our staff, volunteers, contractors and other partners. We shall continue with current works to increase tree cover where possible and at the same tirne, cope with tree diseases. Ash Dieback disease has cost the Trust £113,000 over the last three years and in the next few years we expect to deal with further waves of dead and unhealthy trees. Unfortunately, another tree disease. Acute Oak Decline. has been recorded. Spending on unsafe trees could well rise therefore. although wherever possible the Trust uses its own skilled staff for survey and tree surgery wor Work on the next Lond Monogement Plon will begin in 2024 and go out to public consultation in 2025 with a view to the new plan, covering 2026-2031, going live in April 2026. Remuneration policy and salary costs. Staff salaries are set in accordance with the Local Government pay scale (LGPS) with the exception of the Chief Executive Officei. Posts other than the Chief Executive Officer ale allocated to a spinal column point depending upon the level of responsibility and qualifications needed for the posL Salaries were last independently benchmarked in spring 22 Malvern Hills Trust 2022. The salary of the Chief Executive Officer is set by the Board, following an annual appraisal. At the time of this report, negotiations were still ongoing regarding pay awards across all LGPS payscales. Once agreed the award will be backdated to l April 2024. Statement of trustees, responsibilities and corporate governance The trustees are responsible for preparing the Trustees, Annual Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). The law applicable to charities in England & Wales requires the trustees to prepare financial Statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources of the charity for that period. In preparing these financial statements, the trustees are required to: select suitable accounting policies and then apply them con5iStently. observe the methods and principles in the Charities SORP 2019 (FRS 102), make judgements and estimates that are reasonable and prudent, state whether applicable accounting standards have been followed. subjett to any material departures disclosed and explained in the financial statements and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation. The trustees are responsible for keeping properaccounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities Act 2011, the Charities (Accounts and Reports) Regulations 2008 and the provisions of the governing Acts. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Trustee5 are responsible for the maintenance and integrity of the charity and financial information included on the charity's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Risk management The trustees have in place a formal risk management process to assess business risks and irnplement risk management strategies. The risk management process involves identifying the types of risks the charity faces, classifying them in terms of potential impact and likelihood of occurrence and identifying way5 of managing the risks. At each meeting of the board, trustees are updated on any significant changes to the level of risk, particularly any categories that are gauged to be entering the highest risk category, and any appropriate actions considered. 23 Malvern Hills Trust Post year end the Finance Administration and Resources Committee has met and discussed the Risk Management Strategy and the Committee has approved recommendations to commission a shorter more manageable working document. arrange a workshop for all trustees to consider all risks and ultimately update the register during summer 2024. The key risks identified during the year were: Potential of grant-making bodies such as the Rural Payment Agency making unilateral changes to existing grant schemes which might negatively impact on income levels. Uncertainty in regard of Trusts elettion arrangements following the Boundary Commission review of Malvern Hills District Council ward boundaries. Reputational impacts arising both from the above. and local campaigns (by individuals andlor groups) generating misinformation that affects the reputation of the charity and generates adverse publicity, as well as diverting the limited resources and focus of the organisation from its core objects. The impacts of additional workloads and limited delivery capacity arising from both expected and unexpected loss of staff from key roles within the small staff team. Some area5 of financial operations previously identified as at high risk in the first half of the year. have since moderated. but still warranted careful monitoring. These include the risks of: Impact of Government policy, changes in legislation and regulations Expenditure levels increasing and car park takings and grant funding income falling below expected levels Poor investment returns Following the latest triennial valuation the Trust's pension liability (accounting deficit) has reduced (as disclosed in detail in note 27 to the financial Statements). Medium-term financial plans are in place to ensure the charity can make the required contribution payments in the future. The scheme has been closed to new joiners. Statement as to disclosure to our auditors In so far as the trustees are aware at the time of approving the Trustees, Annual Report. the trustees have each taken appropriate steps to make themselves aware of any information relevant to the audit and to establish that the auditor is aware of that information. By order of the Board of Trustees lohn Michael Choir of Trustees on behalf of the Trustee5 14" November 2024 24 Malvern Hills Trust Independent Auditor's Report to the Trustees of Malvern Hills Trust Opinion We have audited the financial statements of Malvern Hills Trust (the 'Charity ) for the year ended 31 March 2024 which comprise the statement of financial activities, the balance sheet. the statement of cash flows and notes to the financial statements. including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards. including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: give a true and fair view of the state of the Charity's affairs as at 31 March 2024 and of its incoming resources and application of resources, for the year then ended". have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Prartice". and have been prepared in accordance with the requirements of the Charities Act 2011. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAS (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the Trustees. use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertaintie5 relating to events or conditions that, individually or collectively, may cast significant doubt on the Charity's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report. Other information The other information comprises the information included in the annual report other than the f inancial statements and our auditor's reportthereon. TheTrustees are re5pon5ible forthe other information contained within the annual report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing 50, consider whether 25 Malvern Hills Trust the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit. or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to deteimine whether this gives rise to o materiol tnisstatement in the financial Statements themselves. If. based on the work we have performed. we conclude that there is a material misstatement of this other information. we are required to report that fact. We have nothing to report in this regard. Matters on which we are required to report by exception We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if. in our opinion: the information given in the financial statements is inconsistent in any material respect with the Trustee5' report: or sufficient accounting records have not been kept: or the financial statements are not in agreement with the accounting records. or we have not received all the information and explanations we require for our audit. Responsibilities of Trustees As explained more fully in the statement of Trustees. responsibilities, the Trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Trustees are responsible for assessing the Charity's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to cease operations, or have no realistic alternative but to do so. Auditor's responsibilities for the audit of the financial statements We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Att and relevant regulation5 made or having effect thereunder. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor'5 report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAS (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities is available on the Financial Reporting Councll's website at: httPs:Ilwww.frc.org.uklauditorsresponsibilities. This description form5 part of our ouditor's report_ Extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are in5tance5 of non-cornpliance with Iuw5 and iegulaLions. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting 26 Malvern Hills Trust Council's website, to detect material misstatements in respect of irregularities. including fraud. We obtain and update our understanding of the entity. its artivities. its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that frarnework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to froud 01 error, design and perform audit procedures responslve to those rlsks, and obtaln audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud. In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included: Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud: Reviewing minutes of meetings of those charged with governance; Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection; Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations" Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. Because of the inherent limitations of an audit. there is a risk that we will not detect all irregularities. including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements. os we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higherthan for one resulting from error. as fraud may involve collusion. forgery, intentional omissions. misrepresentations, or the override of internal control. Other matters Your attention is drawn to the fact that the charity has prepared financial statements in accordance with "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" (as amended) in preference to the Accounting and Reporting by Charities: Statement of Recommended Practice issued on 1 April 2005 which 15 referred to in the extant regulations but has now been withdrawn. 27 Malvern Hills Trust This has been done in order for the financial statements to provide a true and fair view in accordance with current Generally Accepted Accounting Practice. Use of our report This report is made solely to the Charity's Trustees. as a body. in accordance with part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the Charity's Trustees those matters we are required to state to them in an auditors, report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charity and the Charity's Trustees as a body. for our audit work, for this reporL or for the opinions we have formed. Awl hthF £ 19 November 2024 Azets Audit Services Chartered Accountants Statutory Auditor Epsilon House The Square Gloucester Business Park Gloucester United Kingdom GL3 4AD 28 Malvern Hills Trust Statement of Financial Activities for the year ended 31" March 2024 Unrestrirted Restricted Total funds Total funds funds funds 2024 2023 Note Income ond endowments from." Donations and legacies Charitable activities= Management of the hills and commons Car parks Other trad ing activities Investments- Bank deposits Investment portfolio Other Total income 13.697 4.546 18,243 13.879 831.527 398.720 50.931 39.036 870.563 398,720 50.931 756.190 360.753 78.407 39.354 6.780 33.698 46.134 9,518 33.698 37,785 22,913 16.529 84.060 1,441,202 1,273,061 22.913 1.357.142 Expenditure on." Charitable activities Other expenditure Total expenditure 1.290.495 1.729 1.292.224 48.315 1.338.810 1.287,897 7.350 9.079 15.937 55.665 1.347,889 1,303,834 Net gains on investrnents Net incomellexpenditure) 16 88.332 116,727 88,332 (90.627) 181.645 (121.400) 64,918 Tr¢msfets between fvnds 23 2S.090 (25,090) Other recognised gaIn￿{lO5$esj Actuarial gains/ (890) (75.900) 383.102 106.873 150.564 3S,865 129.473 10.000 34.010 889 17,207 3.501 S.100 8.603 12.500 897.687 12.890 68.000 (34.558) 5.000 1.900 20.000 12.500 51.366 (11.3971 872.658 1 20.61 3 (146.950) The Gift fund holds donations. legacies and gifts which were not restrirted by the donor and which have been designated for use in projects in accordance with the Trustees. policy. The Stewardship funds are the grazing projects to Secure conseNation of the Malvern Hills landscape as set out in the land management plan. The project receives funding from the Higher Level Stewardship and the new Countryside Stewardship schemes. 47 Malvern Hills Trust The Tree Disease fund is to cover costs arising from tree diseases. The Ash Dieback fund wo5 set up during 2021122 to cover the cost of managing Ash Dieback. Spending to date is over £113,000 and we now do not expect the costs to be as high as first thought. We do however now have Acute Decline to deal with so the fund remains in place at the moment and may bc rcdirccted to this new threaL The Fundraising 5UPPOrt fund is to cover costs of future fundraising artivities. The Governance review funds are to cover the costs of any work approved by the Board. These 2 funds have been renamed from the 1" April 2024 to make the use of each clearer. One fund 15 specifically for the"Preparation and Promotion of the new Bill. the other is "other costs attached to the bill" including but not limited to: the consultation. staff c05t5 and other legal fees. The Election expenses fund is to cover the c05t of the 4-yearly election5 to the Board and any by-elections. Elections took place in Autumn 2023 and the next elections will be in 4 years time. A rolling £5000 per year designation has historically been made. This may be reviewed and uplifted as the 2023 elections exceeded this budget which wos covered by general reserves. The Dog campaign fund is to cover the costs of a campaign which was started in 2019120. Work on the campaign was initially delayed by COVID-19 and more recently. activities have been put on hold due to staff and time constraints. The aim is to revisit this in due course. In the meontime. theTrust is continually alerting the public via Social media on the importance of responsible dog walking. The designated fixed asset fund represents the balance on restricted assets purchases which remain designated until fully written down. The car park repair fund is to cover the cost of car park repairs. thi5 was due to be completed in 2022123 but has been delayed due to weather and time resource. Following the retirement of Cheryl Gentry and the resignation of her replacements Helen Barber and Sarah Deacon. the FAM replacement fund objective was to cover the cost of accountancy provision in preparing the Statutory Financial accounts in addition to recruitment expenses.The fund was extended furtherduring 2023124 to cover the additional costs attached to appointing the new CEO. The fund has been closed now that these posts have been filled. Details of transfers made during the year are given in note 23. 48 Malvern Hills Trust 21 Unrestricted pension fund Current year 8akuKe 1st Aprl 2023 Movement incoming ResoLtrces outgolng Balance 315t March 2024 guin￿(1￿￿$esI P￿s1on Fund 48.[￿3 77.( 1612.0001 Prior year BO1[￿ce 15I Movtment incomry ReSou￿e5 ouig0in9 tutsrfal gain￿00￿$> Balance 31st M(wth 2023 2022 Pension Fund (1241.000} {37.C#J)I 1.541.(M)O 1737.0001 The unrestricted pension fund balance arises from the FRS 102 disclosures. The figure shown in 'Transfers and other losses. is the actuarial gainl{loss) as calculated by the Artuary. Furthei information is given in note 27. 22 Restricted funds Cwrent year Bolorte 1st Awil 2023 Tr(￿￿fe Resources Ito}lfrom other Net goi1￿l(loSsesI Bttl(mce 31st out90iThJ funds investments m(￿Ch 2024 Movement incomin9 Londs MaintenarKe fund SDF fund 183.022 453 5.644 199n 15.644} 11.937 193.962 453 Nature of the Mofvtrns book 1901 8.166 1.044 14,604 1.389 2,901 5,131 904 Gifts Treeplonting PIffiicb￿th donobon5 {3.48n 11401 11.7421 452 4546 7.408 1.389 Bwst4Biodiversity FIPL Foothill Connections fuTh FIPLAI Sointswood Urban treed￿￿l¥Kjefuft￿ Donkeyshed Access For Al Land Purth¢tse119921 fund Land Purcha5e2 Fund FIPL too15 Porliarrthtaryfund Capital Outsoy Disthoipy fvnd (SCQI {811 3283 13.208) 164) 1737 17.7871 11.7761 513.881 2W.108 2.673 7.787 7.646 15.606 4,829 16295 14.399 13.0061 12.497) 11.1601 {3,592) 12.6961 21.2651 2064 512,991 215.458 148.0461 34.047 11.681 112.7041 1143991 48D46 125,0901 485.392 1.604.757 2.999.397 30.667 513.363 1.a31.538 3,091,034 71248 {43.8541 88.332 49 Malvern Hills Trust Prlor year Bol(uKe 1st April 2022 Tronsfer5 Resource5 ItDllfTom other Net galns11105se5) Bal(￿¢* 31st outgoing fimd5 on investments March 2023 Movement irK¢ffiing Londs mainte￿n￿ fttnd SDF fund 193.588 453 5591 {1.632) {5.337) 19.1881 183.022 453 Nature of the K4ofvetns book 2.901 6,831 821 2.901 8.166 1,044 4.604 Glfts Tree planting Picnic benth donatiors Comrnunitywoodhnd Boost4Biodiversity FIPL Foothill Connections fund 16651 1357) {1.7191 134) 1.385 6,073 18051 (2.550} 34 2.8CM) 1.389 5ry) 1,389 500 FEPL All Saintswood Urban tree chdltr)gefund Donkeyshed For All 114031 1297) {27.243) 11.7761 (7.1501 1971 {4.4121 159.868} 1107.6531 18,223) 11.257 19.456 2.737 17.7871 {1,7761 513.881 200,108 485,392 1.604,757 2.999.397 Land PLtrchase11992J fund Land Purtha5e2 Fund 933.249 16.943 135 1357.4551 184,263 113,6141 173.187 122,27n 171.7061 15,807 125.5401 Parlitsmentury fund Copital OutkLy Disthorged fund 493.842 1.491.438 3,119.589 35.116 100.365 190,6271 The Lands Maintenance fund formed part of the consideration for the disposal of the land at Townsend Way for the purpose of providing income for the maintenance of the land forming the roadside verges. Investment income earned on this fund may be used for the Trust's general purposes. During the year. £5.644 investment incorne was transferred to the General Fund (2022123 E5.337). The SDF (Sustainable Development Fund) fund is for information boards at North and Tank Quarries. The Nature of the Malverns book was a joint venture project to produce a high-quality book showcasing the nature of the area. The book was published in May 2018. The funds generated from the project are to be used to support conservation projects. The Gifts fund comprises legacies and donations made for specified projects to improve the omenities of the Malvem Hills. The Tree Planting fund received donations for planting trees at Thirds Wood. Picnic bench donation5 are for benches at the Community Woodland. The Boost4Biodiversity fund is from Sevem TrenL to fund pond works. The FIPL fund (Farming in Protected Landscapes) is a grant to support conservation projects within the Malvern Hills AONB. The projects in operation during 2023124 Foothill Connection Evendine o Tools upgrade All Soints Wood. Donkey Shed (along with additional funding via the Malvern Civic Society) The UTCF fund (Urban Tree Challenge Fund) is o grant from the Forestry Commission to support tree plantin9 in urbon areas. Access for All funding is supported via the Malvern Hills AONB and funded by DEFRA. The scheme seeks to remove barriers for people to visit the AONBS via capital improvements to the 50 Malvern Hills Trust "countryside infrastructure" Malvern Hills Trust has benefited with the provision of a variety of gates to newly acquired land. The Lond Purchase (1992) fund (formerly called the Lands Acquisition fund) was set up in 1992 from the proceeds of the disposal of land for road works at Townsend Way. The use of the fund is restricted to the purchase of land. The Land Purchase 2 Fund formed following the Board of Trustees instrurtion to redirect investment funds into a lower risk managed category. The Parliamentary fund was established with a contribution by W. Berington under Section 56(5) of Malvem Hills Act 1924 to receive Capital Receipts and use of the capital of the fund is restricted to the purchase of land and improvements to capital assets. Investment income earned on this fund may be used for the Trust's general purposes. During the year, £14.399 investment income was transferred to the General Fund12022123 £15,116). The Capitol Outlay Discharged fund is represented by the cost of land and the net book value of irnprovements to land and buildings. the original cost of which was funded from the Lands Maintenance or Parliamentary Funds. These assets can only be sold in very limited circumstances (that is. they are inalienable) and any proceeds must be used for the purchase of land. so this fund should be considered as inalienable. 51 Malvern Hills Trust 23 Transfers between funds Transfers made during the year were: Fiom FIPL fotstttilts RF General fund GIft5 RF Land Purchase RF Gifts RF FIPL all 51ants RF FIPL tools RF Land mainienance RF Parliamentary AF Land Purchase RF To tjifts RF Exce5S M FIPL fooihllls. back io RF g1ft5 Ovefspend on Donkey shed small overspend on MVI memorial fund depn on restrirted assets Excess on FIPL loothills. back to RF gifts clear out small balance on FIPL all saints designate Te5lrrted fund asset purchases Non Tegiriaed investment income Non restnaed investment Income From Fiom From From From From From Fiom From To To Donkey shed RF Genefal iund Ca￿la[ outlay discharged RF FIPI foothills RF General hEnd Fixed asset fund DF General fund General fund ca￿.14￿ Duuay dtschai8ed RF 7,787 1481 48.046 Isoji IBII 112,7041 15,6441 114.3991 148,L1461 ro To To To To To To depn on re51ricted assets 125.CV301 Desl nated Frc Ftom Fiom From From From General Fund General Fund General Fund General Fund General Fund HLS Chase End DF HLS Old Hills DF FIPL tools RF General Fund To To To To To To Boundary Commission DF FAMICEO DF EleC￿n costs DF Mi)deinisatson of Arts FAMICEO DF General Fund General Fund Fixed assei fuftd DF Elec￿￿ eypen5es DF To cover experted spend To cover FAM and CEO ieplacement C05t 6udge￿d annual election expens Bafd agreed fund transfer Addilianal FAM CÈO overspend RètharEed stewardshrp salary costs Recharged stewardship salary costs designated r￿trcled fund asset purd)ases Additiorkal election overspend 8.71)0 2.662 14091 16551 12.704 4.523 From From From To To To 67.525 en Fiom Fiom From From Gen&ral Fund General Fund General Fund General Fund General Fund HLS Chase End DF HLS Old Hills DF Genual fund Glfts RF FIPL all slants RF Land maintenance RF To To To To To To To Boundary Commission DF FAMICEO DF Elettion costs OF Modemisation of Acts FAMICEO DF General Fund General Fund Donkey shed RF General fund General lund General fund General fund EleC￿n expenses OF To covei expèrted spend To cover FAM and CEO replacemert cost Budgeted annual elettion expenses Board agreed fund transfer Addsthtinal FAM CEO ovèrspend Recharged stewardship salary costs Rechar8ed stewardship salary costs Overspend on DonkLy shed small overspend on WWI memorial fund clear out small balance on FIPL all saints Non resiricted investment income Non restricted investment Incorne Addittonal election overspend iio,ocoi 125.1*)Jl 18,7CQI 12,662 409 655 17,7871 From From From From Fiom To To From Fiom To To 81 From Parliamentary RF General Fund To To 14.399 14,5231 From 142.4351 52 Malvern Hills Trust Tpjnskr delaits RedJ*n From PaliLimentaTr' fund Fiom Lon& MI￿ntinu￿￿ fuThJ To lion5f￿ IrhTrEsimentinco To lions1￿ iTr*c51m2ntincor 13.i114 5,337 )5 Fiom Djnation Schcr[￿- Tv EL7¥L￿ OJiiliiiy TcpCOTEi rrxilrriolond staff CDsts TOCO￿ puKh(seof Fiom PEnic b1￿hd)not10 To Communit)'I'Axdkirx kt (tcti fiom vcsiTlc￿d futtd5 2550 i34i 22272 From fjiftdtsig￿￿o1 fuTr Fiom SknyowdshiprJLsigTh)￿l fuMI To EL￿￿.0￿ ExWn5sdffj5igT•Jt￿ fund ToTicvDsw*4)sodtsignotcd fvnd To Ash DiObxkd(SbJnot￿d f￿d lo BOUTh￿01> Commission 0dvl￿d￿￿jr￿d fuTr To Coi Paik RepJKldo5IgThJt￿ fund To FAIYI Re[￿C￿nId(S￿Jr￿tLM4 fund N@i jto I frorn dcs*Jna￿d hJThJ5 68D34 To to** stoff costs Toco7￿1 cosÈOfeL*￿nSlo theBcord Toco*er costs aii5ing liom tscc