## **THE 1989 WILLAN CHARITABLE TRUST**
**FINANCIAL STATEMENTS YEAR ENDED 30TH SEPTEMBER 2021**
**CHARITY NO. 802749**
**THE 1989 WILLAN CHARITABLE TRUST**
## **TRUSTEES' REPORT - Year Ended 30th September 2021**
## **LEGAL AND ADMINISTRATIVE DETAILS**
The Trustees submit their report and financial statements of The 1989 Willan Charitable Trust (the "Charity") for the year ended 30th September 2021. The financial statements have been prepared in accordance with the accounting policies set out in note 1 and comply with the trust deed, the Charities Act 2011 and the Statement of Recommended Practice, Accounting and Reporting by Charities 2015 (FRS 102).
|**Legal Status**|The 1989 Willan Charitable Trust is a registered charity (registered|The 1989 Willan Charitable Trust is a registered charity (registered|
|---|---|---|
||number 802749).||
|**Governing Document**|Trust Deed dated 8th August 1989||
|**Trustees**|A Chapman||
||A Ohlsson||
||Willan Trustee Limited||
||(Directors - M Bird, A Chapman, A Ohlsson,||
||S Winfield and C Seccombe)||
|**Key Management Personnel**|The charity does not employ any staff and therefore the board||
||remain responsible for the day-to-day operation of the charity.||
|**Administrators and Principal Office**|Carlton Management Services Limited||
||PO Box 525, 4th Floor||
||45 Esplanade||
||St Helier||
||Jersey||
||JE4 OWZ||
|**Grant Advisors**|The Community Foundation||
||Philanthropy House||
||Woodbine Road||
||Gosforth||
||Newcastle upon Tyne||
||NE3 1DD||
|**Investment Managers**|Brewin Dolphin Ltd|Baillie Gifford|
||Time Central|Calton Square|
||32 Gallowgate|1 Greenside Row|
||Newcastle Upon Tyne|Edinburgh|
||NE1 4SR|EH1 3AN|
||UBS Wealth Management||
||2 St. James' Gate||
||Newcastle Upon Tyne||
||NE4 7JH||
|**Bankers**|Santander Private Banking||
||PO Box 545||
||St. Helier||
||Jersey||
||JE4 8XG||
|**Solicitors**|Muckle LLP||
||Time Central||
||32 Gallowgate||
||Newcastle Upon Tyne||
||NE1 4BF||
||Wardhadaway||
||Sandgate House||
||102 Quayside||
||Newcastle Upon Tyne||
||NE1 3DX||
|**Auditors**|Azets Audit Services||
||Bulman House||
||Regent Centre||
||Gosforth||
||Newcastle upon Tyne||
||NE3 3LS||
1
**THE 1989 WILLAN CHARITABLE TRUST**
## **TRUSTEES' REPORT - Year Ended 30th September 2021**
## **AIMS AND OBJECTIVES**
The Charity was established by an initial gift from the Willan family out of funds originating from a shipping business based in the North East of England. Over the years the Willan family have settled further funds on the Charity.
The Charity's trust deed gives the trustees wide powers to distribute the income of the trust and such of its capital as they deem appropriate to or for such charitable institutions or charitable purposes as the trustees in their absolute discretion think fit. However, within this broad remit, the trustees recognise that the resources of the Trust are finite and that it is therefore necessary to target funds more selectively to areas where the funds can be used most effectively and can make the most difference.
In recognition of the origins of the Trust fund and the economic impact that the decline of the ship building industry has had on the region, the trustees tend to concentrate their support towards causes which are active in Tyne and Wear and its immediate surrounds. The trustees favour causes which aim to ease social deprivation and / or enrich the fabric of the local community and the quality of life of individuals within that community. They may also support education where that is aimed at improving the economy in areas of deprivation. As well as direct support for such causes in the form of grants, the trustees may also provide indirect support, using the Trust’s capital to make resources (typically premises) available to other deserving charitable organisations.
The trustees aim to distribute £500,000 to £600,000 per annum based on a real return of 4% upon the trust assets.
## **PUBLIC BENEFIT STATEMENT**
The trustees have referred to guidance contained in the Charity Commission’ general guidance on public benefit when reviewing the aims and objectives and in planning future activities. The charitable objectives are also set in order to provide a clear and demonstrated public benefit.
The Charity's activities throughout the period were consistent with its aims and objectives as stated above. All such activities are undertaken to further our charitable purposes for the public benefit.
## **STRUCTURE, GOVERNANCE AND MANAGEMENT**
The Charity is an unincorporated trust constituted under a trust deed dated 8th August 1989 and is a registered charity (numbered 802749). The trust deed provides that there be a minimum of three trustees. The trustees are appointed by members of the Willan family and serve for an indefinite term. The trustees who served the Charity during the year were as follows:
A Chapman A Ohlsson Willan Trustee Limited
The Charity does not actively fundraise and seeks to continue its support to appropriate charitable causes through the careful stewardship of its existing resources. The management of the Charitable fund is divided into two principal areas, asset management and grant making.
Responsibility for the asset management function is delegated to external investment managers. Brewin Dolphin Securities Ltd, UBS Wealth Management and Baillie Gifford manage investment portfolios for the Charity under discretionary investment management agreements. The trustees monitor the performance of the portfolios on a quarterly basis against relevant benchmarks.
The trustees are grateful to the Community Foundation serving Tyne & Wear and Northumberland (the " **Community Foundation** "). Applications are processed, collated and shortlisted by the Community Foundation on a quarterly basis. A subcommittee of the board of Willan Trustee Limited meet each quarter to vet the shortlist. The shortlist is then circulated to each of the trustees for consideration and approval.
Carlton Management Services Limited, a licenced trust company regulated by the Jersey Financial Services Commission, provides administrative and accounting services to the Charity.
The trustees aim to meet at least once a year to review the Charity's financial statements for the preceding year, the performance of its assets and its grant making activities and to consider whether changes are required in the Charity's policies and overall strategy.
## **RECRUITMENT OF TRUSTEES**
Any trustee vacancies which arise are filled by search with due regard to maintaining a proper balance of skills and experience within the Board. Representation relevant to the service user group is a key factor given the Charity's mission.
All appointments are subject to the approval by members at a general meeting. With the notice of such meeting members are provided with a profile of prospective new trustees - and equivalent information for any trustee offering themselves for reelection. Additionally a full attendance record is provided to members to inform their decisions.
2
**THE 1989 WILLAN CHARITABLE TRUST**
**TRUSTEES' REPORT - Year Ended 30th September 2021 (Continued)**
## **TRUSTEE INDUCTION AND TRAINING**
New trustees are provided with a proper induction process and a checklist ensures they receive all relevant papers and guidance to properly fulfil their responsibilities. Briefing papers and familiarisation training is affected for all trustees as deemed necessary.
## **RISK MANAGEMENT**
The trustees have considered the major risks to which the Charity is exposed and have established systems and procedures to manage those risks.
## **RESERVES POLICY**
The results for the year leave The 1989 Willan Charitable Trust with an Unrestricted Revenue Reserve of £24,443,246. It can be seen that of this sum £154,606 is held in Net Current Assets, that is, represented by cash, net debtors and therefore readily expendable by the trustees.
The trustees aim to distribute £500,000 to £600,000 per annum based on a real return of 4% upon the trust assets. It is the policy of the Charity to maintain a free cash balance of approximately six months' unrestricted expenditure. This provides sufficient funds to cover management, administration and support costs and to respond to applications for grants which arise from time to time.
The trustees have reviewed activities and prepared a risk assessment to enable them to consider the financial position of the organisation in light of the ongoing situation in relation to the Covid-19 virus. On conclusion of this work the trustees, having considered both the significant level of cash and investments held by the charity consider that there are no material uncertainties regarding the charity's ability to continue as a going concern for the next 12 months.
## **FINANCIAL REVIEW**
As at 30 September 2021 the allocation stood as follows: 29.6% UBS discretionary portfolio, 29.9% Brewin Dolphin discretionary portfolio, and 40.5% Baillie Gifford Managed B Acc. In Q4, UK equities delivered a total return of +2.0% whilst 7- 10 year gilts delivered a total return of -1.5% and the 50:50 composite index rose +0.2%. The composite return of the Willan portfolio was +1.3%.
The covid recovery remained the dominant driver of financial market performance. The recovery in corporate profits has been extremely robust and yoy earnings growth is forecast at +40%. As a result, risky, cyclical assets outperformed whilst defensive assets disappointed. For the full year global equities delivered a total return of +29.0%, led by energy companies +61.4% and financial companies +49.0%. Inflationary pressures mounted as Brent rose +92.4%, Natural gas rose +132.3% and Industrial metals rose +40.2%. In contrast, global government bonds fell -1.4% (7-10yr) and gold fell -6.8%. UK equities rose +25.4% and gilts fell -5.0%. Underperformance of UK assets vs global benchmarks partly reflected sterling strength as the pound gained +4.3% vs the US Dollar, +5.6% vs the Euro and +10.0% vs the Yen. The compounding influence of Brexit and a more severe covid impact also weighed on UK Businesses.
All 3 portfolios comfortably outperformed the 50:50 Benchmark benefiting from their overweight exposure to UK and International equities. UBS was the strongest portfolio +20.7%, closely followed by Brewin Dolphin +20.2%. Baillie Gifford was marginally weaker +16.7%. The UBS portfolio is predominantly invested in UK assets and has more exposure to value sectors which outperformed. The other portfolios are more internationally diversified and suffered to a greater extent from the strength of the pound. Brewin and Baillie Gifford benefitted from their overweight allocation to inflation linked and corporate bonds, which comfortably outperformed government bonds. Baillie Gifford delivered a staggering performance last year, significantly outperforming the other portfolios, but notably lagged this year. It holds a significant proportion of assets in US growth stocks and virtually no exposure to banks or energy companies. It also has higher exposure to Chinese stocks including tencent and alibaba which significantly underperformed global equities (Hang Seng -7.1%).
Total interest and dividend income was £437,294 equal to a yield of approximately 1.8%. This is consistent with both historic levels, and the trustees' expectations. The overall value of investments rose 15.8% (net of fees and distributions) to £24,040,256.
## **REVIEW OF GRANT MAKING ACTIVITIES**
With effect from September 2020, the Charity has entered into a new Philanthropy Agreement with The Community Foundation, who will be responsible for payments of grants (under the new agreement) and will administer these from the funds held. Any monies paid to The Community Foundation under the new agreement will become an irrevocable gift. The Charity donated £493,823 to The Community Foundation in the financial year, to be distributed in accordance with the Philanthropy Agreement. Prior to September 2020, the Charity awarded 75 grants totalling £504,320 in the financial year to 30 September 2020 and a further £125,000 to The Community Foundation under the new agreement.
In addition to the grant making activity outlined above, the Charity gifted an additional £80,000 in total to the universities of Sunderland, Teesside, Newcastle and Northumbria, in order to provide support to graduates seeking to fund viable, sustainable new business ventures. (2020: £73,500).
As detailed in the accounting policy: gifts in kind, the charity also made effective donations totalling £32,400 (2020 - £37,185) in respect of lease arrangements made with other charitable organisations to provide access to accommodation at a below market value rental.
The trustees believe the services of the Community Foundation are delivering real value in helping the trustees to identify causes consistent with the stated aims and objectives of the Charity. In addition, the trustees recognise that the administration fees paid by the Charity to the Community Foundation indirectly support the charitable purposes of the Community Foundation itself which are wholly consistent with those of the Charity.
3
1989 WILLAN CHARITABLE TRUST
TRLISTEES. REPORT- Year Ended 30th S•pt•mber 2021 Icontlnuedl
FUNDRAISING DISCLOSURES
The Chatity is requirad to rÈport how it deaL8 with lundralsing the public. The Chanly d$ not a¢Uvgty fundraise and
SkS to continue rt$ support to appropriate ¢harltable ¢au5e$ through thg careful staward$hip of its e$tIng lunds. rewived
from the Willan family.
PLANS FOR FUTURE YEARS
The trustee5 do not anticipate swJnilicant charye5 to the 5tru¢*ure, resourc85 and OFerationg of tho Chanty in the fore$eeabl
fuiure. However, to Ihe extent that Suitable chadtable proje¢t5 may be hl8ntifi£d, tho trustees may ¢on$idÈr 8llo¢ating a portion
of the Charity's grant making eapa¢ity to prowding significant 8UPPOrt lo a limlted numbèr o15PBGffic charrtable prDject5.
STATEMENT OF TRUSTEES, RESPONSIBILITIES IN RELATION TO THE FINANCIAL STATÉMENTS
Th8 Charity'$ knu$tee¥ ar8 respon8le for prepartng the tru$tee$' annual report and the fin8ncial 8tstements in accordance wrth
the United ngdDrn Accounting Standards IUnit*J Kingdom Generally Accepted Accounting Pra¢ti¢¢l and appIlb law and
rtyulalions.
The law appllcable to charlties In England and Wd8s requirès the trustee$ to prepar8 finanual $tafgrngnts for ea¢h flnanciat
year. Ljnder that law the truste8s have elected to prepare the finanual slat&ments In accordance with Financial RepDrting
Standard applIcab in the UnKed Kingdom IFRS 1021. The Iru$teos must not approve the h)anEial statements unle55 they are
$atssfled that they give a true fair view ol the 5tata of affairs of the Charity and th8 Incomè and expenditurt ef the Charity
for that pe0d. In preparing these fmancial 5talements. the trustees ar8 r8quired to..
- Selt suitable accountlng pollctes and then appty them consL8t8ntly.'
- ob$erve Ihe rnethod5 and principkn5 in the Charibes SORP.,
- rnake judgement8 and estimat&s that are reasonable and prudent",
stats wh?ther applicable accounting standards have been fdlo%¥Bd, $ubje¢t to any maierial departur8s disclo88d 8Th
explain in the financial st8t8mBnts,'
- prepare the financial statements on the going conc8rn b88is unkss it is Inapproprfate to presume that the charity will Cont
in owraticn.
The trustees are responsible for kgeping prgpgr ac¢ounting rerdS that discbse with reasonab accuracy at any t1ft the
financk91 position of the charlty and efiab them to ertsure that the financial statement5 comply with the Chanties A¢t 2011. the
applicable CharItS IAccuunt5 and R2pottsl Regulations. 3nd the provisions of tho con$titution The trustee5 are aL80
r8sponsibl8 for safeguarding the assets Of Ihe ¢harity and hence h¢ takin9 iea8onablg steps for the pravention and detectiofi of
fraud and olh*r Irregularfties.
AUDITOR
Azets Audit Services tirnited. trading as Azet¥ Audit Semces, were appointed as aud¢tors to the Gharity lo1101ng their
acqui5rt)n of thg tr3de of Talt Walker LLP, trading a5 MHA TaA Walker. on 1 May 2022. Azet5 Audit S8Ntc8s have Indicated
th91rlngness to Snd fer reappolMènt at thè forthcoming Annual Gewral Meetin9.
o by the Trusie8s on
l ? lune &c*)A
and Sned on Ihair behaw by..
A Ohlss
Dlr¢¢to
**THE 1989 WILLAN CHARITABLE TRUST**
## **INDEPENDENT AUDITORS’ REPORT TO THE TRUSTEES Year Ended 30[th] September 2021**
## **Opinion**
We have audited the financial statements of Willan Charitable Trust (the 'entity') for the year ended 30 September 2021, which comprise the Statement of Financial Activities, Balance Sheet, Cash Flow Statement, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is United Kingdom Accounting Standards, comprising Charities SORP - FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and applicable law (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
- give a true and fair view of the state of the entity's affairs as at 30 September 2021 and of its 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 Charities SORP (FRS 102) Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable to UK and Republic of Ireland (FRS 102).
## **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 entity 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 Trustee’s 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 uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the entity's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 Trustees are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
## **Matters on which we are required to report by exception**
In the light of our knowledge and understanding of the entity and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Report.
We have nothing to report in respect of the following matters where the best practice requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of Trustees remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.
5
**THE 1989 WILLAN CHARITABLE TRUST**
## **INDEPENDENT AUDITORS’ REPORT TO THE TRUSTEES Year Ended 30[th] September 2021**
## **Responsibilities of Trustees**
As explained more fully in the Statement of Trustee's Responsibilities (set out on page 4), 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 entity's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the entity or to cease operations, or have no realistic alternative but to do so.
## **Auditor’s responsibilities for the audit of the financial statements**
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
- Enquiry of management and those charged with governance around actual and potential litigation and claims;
- Reviewing minutes of meetings of those charged with governance;
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; and
- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business’.
Because of the field in which the client operates, we identified the following areas as those most likely to have a material impact on the financial statements: the Charities Act 2011.
Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
## **Use of our report**
This report is made solely to the charity’s trustees, as a body, in accordance with section 144 of the Charities Act 2011 and regulations made under section 154 of that Act. 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 auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and its trustees as a body, for our audit work, for this report, or for the opinions we have formed.
………………………………….
Simon Brown BA, ACA, DChA (Senior Statutory Auditor) For and on behalf of Azets Audit Services
Statutory Auditor Bulman House Regent Centre Gosforth Newcastle upon Tyne NE3 3LS Date…………………….
Azets Audit Services is a trading name of Azets Audit Services Limited.
6
## **THE 1989 WILLAN CHARITABLE TRUST**
## **STATEMENT OF FINANCIAL ACTIVITIES - Year Ended 30th September 2021**
|Notes
**INCOME**
**Income from charitable activities**
2
**Other incoming resources:**
Dividends and Fixed Interest (Net)
3
Deposit Interest Received
**TOTAL INCOME**
**EXPENDITURE**
**Cost of raising funds:**
Investment Portfolio Management Fees
**Expenditure on charitable activities:**
Gift in Kind
5
Cost of Grant Making
6
**TOTAL EXPENDITURE**
Revaluation of Investment Property
7
Movement on Investments including Gains & Losses
8
**NET MOVEMENT IN TRUST FUND**
**Total funds brought forward**
**Total funds carried forward**|Year ended
30 Sep 2021
£
32,400
437,197
99|Year ended
30 Sep 2020
£
37,185
466,926
907|
|---|---|---|
||469,696
70,016
32,400
598,044|505,018
42,864
37,185
737,308|
||700,460
-
3,508,812|817,357
-
728,465|
||3,278,048
21,165,198|416,126
20,749,072|
||24,443,246|21,165,198|
7
Tr1É 1989 WILLAN CHARITABLE TRUST
BALANCE SHeET-At Joth September 2021
30 Sep 2021
30 Sep 2020
Not8s
FIXED ASSETS
InvEStment Propwty
Investments.
248,384
24,040,256
248,384
20.764.263
Inve$trnent$
Programme Related Inv8s¢rnen¢s
24,288.640
21,012.647
CURRENT ASSETS
Cash at Bank
160.306
158.071
160.306
158.071
CURRENT LIABILITIES
CREDITORS.. Amounts F31bng EIUB
wrchin One Year
10
5.7
5,520
5,7
5,520
NET CURRENT ASSETS
154,6Q6
152,551
TOTAL ASSETS LESS CLIRRENT UABILITIES
24,443.246
21,165.198
NET ASSErs
24,443.246
21,165,198
TRUST FUND
IP8ge 7)
24,443,246
21,165,198
ThB financial ¥tsternents were approved by the Truste on
and svjned on their behalr by".
Trustee
an Trus¢e& Lkn
A Ohlsson
01¢tor
F A Chapman
DtictOr
## **THE 1989 WILLAN CHARITABLE TRUST**
## **STATEMENT OF CASH FLOWS - At 30th September 2021**
|**OPERATING ACTIVITIES:**
Net Movement in Trust Fund
Adjusted for
Movement on investments including Gains and Losses
Decrease in Debtors
Increase in Creditors
**Net Cash Outflow from Operating Activities**
**INVESTING ACTIVITIES:**
Dividends and Fixed Interest
Investment Management Fees
Transfers from Portfolios
Proceeds from the sale of investment property
**Net Cash Inflow from Investing Activities**
**INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS**
**CASH AND CASH EQUIVALENTS AT 1 OCTOBER**
**CASH AND CASH EQUIVALENTS AT 30 SEPTEMBER**|30 Sep 2021
£
3,278,048
(3,508,812)
-
180|30 Sep 2020
£
416,126
(728,465)
1,909
120|
|---|---|---|
||(230,584)
(437,197)
70,016
600,000
-|(310,310)
(467,422)
42,864
600,000
80,000|
||232,819|255,442|
||2,235
158,071|(54,868)
212,939|
||160,306|158,071|
9
**THE 1989 WILLAN CHARITABLE TRUST**
## **NOTES TO THE FINANCIAL STATEMENTS - Year Ended 30th September 2021**
## **1. ACCOUNTING POLICIES**
## **- Accounting Convention -**
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with Financial Reporting Standard applicable in the United Kingdom (FRS 102) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the United Kingdom (FRS 102) and the Charities Act 2011.
The 1989 Willan Charitable Trust meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recorded at historical cost or transaction value unless otherwise stated in the relevant accounting policy notes. The financial statements are prepared in sterling, which is the functional currency of the entity.
## **- Investment Property -**
Property is shown at its fair value, which is taken to equal its market value, as estimated by the trustees. Any gain or loss on revaluation is taken to the Statement of Financial Activities. Property is held for the benefit of UK Registered Charities and the trustees do not receive commercial rent but account for the value of the commercial rent as rental income and as charitable donation. As property is held for long term capital gain and does not contribute to the net income of The 1989 Willan Charitable Trust, the trustees believe that it is not therefore appropriate to charge depreciation.
## **- Investments -**
Investments are stated at their fair value, which is taken to equal the closing mid-market value as at 30th September 2021, net of any accrued management fees payable. Any gain or loss on revaluation is taken to the Statement of Financial Activities.
## **- Programme Related Investments -**
PRI are separately held from the charity's other investments and are held at net recoverable cost. The PRI represent loans and equity Investments made by the charity into new start-up companies with the potential to increase economic activity and employment in the North East of England. At each year end, the trustees assess the likelihood of recovery and provide against these investments, reducing the value of the investments. Where PRI are impaired at the year end, the charity charges 'charitable activities' within resources expended. Where a gain is made upon disposal of a PRI, then the gain is reported under 'other incoming resources'.
## **- Debtors-**
Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.
## **- Cash at bank and in hand-**
Cash at bank and in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.
## **- Creditors and provisions-**
Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.
## **- Taxation-**
The charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.
## **- Income-**
Income is recognised when the charity has entitlement to the funds, any performance conditions attached to the item of income have been met, it is probable that the income will be received and the amount can be measured reliably.
Income from government and other grants, whether 'capital' grants or 'revenue' grants, is recognised when the charity has entitlement to the funds, any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably and is not deferred.
Interest receivable is recognised on a receivable basis, when the amount can be measured reliably - this is normally upon notification of the interest paid or payable by the bank.
## **- Investments Income-**
Investment income is accounted for in the period in which the Charity is entitled to receipt.
10
**THE 1989 WILLAN CHARITABLE TRUST**
## **NOTES TO THE FINANCIAL STATEMENTS - Year Ended 30th September 2021**
## **1. ACCOUNTING POLICIES (continued)**
## **- Gift in Kind-**
Income from commercial trading activities is recognised as earned (as the related goods and services are provided) and as the rental and service charge falls due. Income regarded as "Rental Income from Properties" is included as a gift in kind based on the market rental value of each property. This is due to the charity entering into lease arrangements with charitable organisations to provide accommodation to those organisations at below market rental and often for £Nil consideration.
The trustees recognise that in doing so, these type of transactions continue to further their charity's objectives and are similar to the charity providing donations to these other charitable organisations. As a result the trustees have recorded the market value of the property rental as "Income from Charitable Activities - Rental Income from Properties" and an identical charge included as a "Gift in Kind" as part of Resources Expended in the SOFA. This has a £Nil impact on the reported result for the year, but recognises both the income that would be otherwise received and the effective donation made. This treatment does not impact upon the basis for holding these properties, for their capital gain potential rather than their social purpose.
## **- Expenditure-**
Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Expenditure is classified under the following activity headings:
● Costs of raising funds are those costs of investments management fees, together with their associated support costs.
● Expenditure on charitable activities includes the costs associated with the provision of grant making and include both the direct costs and support costs relating to the activities of the charity.
● Other expenditure represents those items not falling into any other heading.
Irrecoverable VAT is charged as a cost against the activity for which the expenditure was incurred.
## **- Donations to the Community Foundation -**
With effect from September 2020, the Charity has entered into a new Philanthropy Agreement with The Community Foundation, who will be responsible for payments of grants (under the new agreement) and will administer these from the funds held. Any monies paid to The Community Foundation under the new agreement will become an irrevocable gift. Donations to The Community Foundation are recognised within the cost of grant making in the SOFA.
## **- Fund Accounting -**
The trustees have adopted an absolute return approach to investment, aiming to generate (and distribute) a real return on the Charity's assets averaging 3-4% per annum over the economic cycle. The Trust Deed makes no material distinction between the distribution of capital and the distribution of income and hence the balance of the Trust Fund is not segregated between them.
## **- Going Concern -**
The trustees have reviewed activities and prepared a risk assessment to enable them to consider the financial position of the organisation in light of the ongoing situation in relation to the Covid-19 virus. On conclusion of this work the trustees, having considered both the significant level of cash and investments held by the charity, consider that there are no material uncertainties regarding the charity's ability to continue as a going concern for the next 12 months.
## **2. INCOME FROM CHARITABLE ACTIVITIES**
|Rental income from properties
**3. INVESTMENT INCOME**
UK Equities
UK Fixed Interest
UK Unit Trusts
Non UK Equities
Non UK Unit Trusts
Non UK Fixed Interest
Alternative Investments|30 Sep 2021
£
32,400|30 Sep 2020
£
37,185|
|---|---|---|
||30 Sep 2021
£
270,077
6,931
49,215
55,477
51,309
272
3,916|30 Sep 2020
£
275,133
15,792
53,140
45,811
67,373
3,660
6,017|
||437,197|466,926|
## **4. TRUSTEES' REMUNERATION**
No salaries or wages have been paid to employees, including the members of the committee during the year (2020-None).
11
**THE 1989 WILLAN CHARITABLE TRUST**
## **NOTES TO THE FINANCIAL STATEMENTS - Year Ended 30th September 2021**
## **5. GIFTS IN KIND**
|**5. GIFTS IN KIND**|||
|---|---|---|
|Rental donations
**6. COST OF GRANT MAKING**
Grants Awarded
Donations to The Community Foundation
Donations to universities
Donation to purchase fund property
Prior Year Donations Returned
Administration fees
Audit and Accountancy fees
Property expenses
Bank charges
**Analysis of Donations to Universities:-**
Teesside University
Sunderland University
Northumbria University|30 Sep 2021
£
32,400|30 Sep 2020
£
37,185|
||30 Sep 2021
£
-
493,823
80,000
-
(6,200)
24,691
5,700
-
30|30 Sep 2020
£
504,320
125,000
73,500
5,000
-
22,450
5,520
1,488
30|
||598,044|737,308|
||£
30,000
30,000
20,000|£
30,000
30,500
13,000|
||80,000|73,500|
As detailed in Note 7 the Trust owns property which is let to registered charities at peppercorn rental. The commercial value of the rental for the period was approximately £32,400 (2020 - £37,185). These amounts have been shown as rental income and as donations. A full listing of grants awarded is available on request from the Community Foundation at the address listed on page 1.
|**7. INVESTMENT PROPERTY**
Held for sale
£
Summary
2021
Cost or valuation at beginning of period
-
Disposals
-
Transfer to held for sale
-
Revaluations in year
-
Cost or valuation at end of period
-
Held for sale
£
By property -
2021
15 Taylor Street, Blyth, Northumberland NE24 5NA
-
77 Vine Street, South Shields, Tyne & Wear NE33 4RG
-
15 Chichester Road, South Shields, Tyne & Wear NE33 4AA
-
96 Northbourne Street, Gateshead, Tyne & Wear NE8 4AH
-
100 Hallside Road, Blyth, Northumberland, NE24 5PF
-
-|Held for sale
£
2021
-
-
-
-|Held for
long term
£
2021
248,384
-
-
-|Held for sale
£
2020
80,000
(80,000)
-
-|Held for
long term
£
2020
248,384
-
-
-|
|---|---|---|---|---|
||-|248,384|-|248,384|
|||Held for
long term
£
2021
34,666
49,195
50,661
53,420
60,442|Held for sale
£
2020
-
-
-
-
-|Held for
long term
£
2020
34,666
49,195
50,661
53,420
60,442|
||-|248,384|-|248,384|
All of the above properties are freehold apart from 96 Northbourne Street which is leasehold.
The trustees believe the market value of the properties held for the long term, are equal to their historic cost of £248,384 (2020 - 248,384 being £259,996 with impairment of £11,612).
15 Taylor Street was purchased on 17th June 2014 and was let from 20th August 2014 to a registered charity for a peppercorn rent. The commercial value of the rent for 15 Taylor Street is approximately £6,000 per annum. (2020: £5,760).
12
**THE 1989 WILLAN CHARITABLE TRUST**
## **NOTES TO THE FINANCIAL STATEMENTS - Year Ended 30th September 2021**
## **7. INVESTMENT PROPERTY (** _**continued)**_
77 Vine Street, 15 Chichester Road, and 96 Northbourne Street were purchased on 11th September 2014, 26th September 2014 and 11th August 2014 respectively and are let to a registered charity for a peppercorn rent. The commercial value of the rent for these properties is approximately £19,680 per annum. (2020: £18,960).
100 Hallside Road, was purchased on 12th November 2014 and was let from 4th February 2015 to a registered charity for a peppercorn rent. The commercial value of the rent for 100 Hallside Road is approximately £6,720 per annum. (2020: £6,480). The title deeds of the properties are currently held in the name of Willan Properties No1 Limited, Willan Properties No2 Limited and Willan Trustee Limited as the charity is unincorporated and is not able to hold property directly. All three companies are controlled by the trustees of the charity (Willan Trustee Limited being a trustee directly) and therefore have taken the view that the properties are beneficially owned by the charity.
|**8. INVESTMENTS**
Market value at beginning of year
Income
Expenses
Withdrawals
Movement on investments including Gains and Losses
Market value at year end
Held as follows:-
UK Equities
UK Fixed Interest
Non UK Equities
Non UK Unit Trusts
Non UK Fixed Interest
Alternative investments
Investment Dealing Accounts
Accrued Management Fees
Held by:-
**Portfolio**
**Turnover (%)**
Brewin Dolphin Newcastle - Discretionary portfolio
11.04%
UBS AG Newcastle - Discretionary portfolio
32.82%
Baillie Gifford - investment portfolio
N/A|30 Sep 2021
£
20,764,263
437,196
(70,016)
(600,000)
3,508,813|30 Sep 2020
£
20,211,240
467,422
(42,864)
(600,000)
728,465|
|---|---|---|
||24,040,256|20,764,263|
||£
15,186,433
1,552,786
3,677,456
1,409,467
202,720
1,380,829
656,166
(25,601)|£
13,311,916
1,811,538
2,748,018
1,254,509
-
1,194,215
457,378
(13,311)|
||24,040,256|20,764,263|
||£
7,126,864
7,087,238
9,826,154|£
6,203,849
6,143,008
8,417,406|
||24,040,256|20,764,263|
Discretionary investment portfolios are managed by Brewin Dolphin Newcastle, UBS AG Newcastle and Baillie Gifford. At 30th September 2021, the portfolios did not include any individual investments whose market value was greater than 5% of the market value of the total (2020-None).
|Historic Cost
**9. PROGRAMME RELATED INVESTMENTS**
Cost
As at 1 October
Additions - Komotion Limited
As at 30 September
Impairment
As at 1 October
Impairment - Komotion Limited
As at 30 September
Carrying Value
PRI Balances as at 30 September 2021
PRI Balances as at 30 Setember 2020|£
16,862,731|£
16,688,731|
|---|---|---|
||30 Sep 2021
£
25,000
-|30 Sep 2020
£
25,000
-|
||-|-|
||(25,000)
-|(25,000)
-|
||-|-|
||-|-|
||-|-|
PRI Balances as at 30 September 2020
13
**THE 1989 WILLAN CHARITABLE TRUST**
## **NOTES TO THE FINANCIAL STATEMENTS - Year Ended 30th September 2021**
## **9. PROGRAMME RELATED INVESTMENTS (** _**continued)**_
In 2018, the charity made an equity investment in Komotion Limited, a new start-up company with the potential to increase economic activity and employment in the North East of England. As at 30 September 2018, the Trustees were of the opinion that the investment should be fully impaired given its early stage development. Having reviewed the PRI position at 30 September 2021, the Trustees have agreed the investment should remain fully impaired.
## **10. CREDITORS: Amounts Falling Due Within One Year**
|Audit fee|30 Sep 2021
£
5,700|30 Sep 2020
£
5,520|
|---|---|---|
## **11. TRUST FUND**
The trustees have adopted an absolute return approach to investment, aiming to generate (and distribute) a real return on the Charity's assets averaging 3-4% per annum over the economic cycle. The Trust Deed makes no material distinction between the distribution of capital and the distribution of income and hence the balance of the Trust Fund is not segregated between them.
## **12. ANALYSIS OF NET ASSETS BETWEEN FUNDS**
|Unrestricted Funds|Tangible
Fixed Assets
£
248,384|Investments
£
24,040,256|Net Current
Assets
£
154,606|Total
£
24,443,246|
|---|---|---|---|---|
## **13. RELATED PARTY TRANSACTIONS**
Mr A Ohlsson, trustee, is a director of Carlton Management Services Limited, the company providing the accounting and administrative services to the Charity. There was no charge made in respect of such services and no outstanding balances at the year end.
Mr A Ohlsson and Mr A Chapman, trustees, are directors of Somerston Ventures Limited, a company who also hold a 5% equity share in Komotion Limited.
## **14. CAPITAL COMMITMENTS**
The Charity has no capital commitments at the year end (2020 - None).
## **15. CONTINGENT LIABILITIES**
The Charity has no contingent liabilities at the year end (2020 - None).
## **16. ULTIMATE CONTROLLING PARTY**
In the opinion of the trustees there is no ultimate controlling party other than the trustees.
14