Registration number.. IP000166 Connswater Homes Limited Annual Report and Financial Statements for the Year Ended 31 March 2024
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Contents Board of Management and Advisers Report of the Board of Management 2to10 Independent Auditor's Report to the members of Connswater Homes Limited 111014 Statement of Comprehensive Income Statement of Financial Position 16to17 Statement of Changes in Reserves 18 Statement of Cash Flows 19 Notes to Statemenl of Cash Flows 20to22 Notes to the Financial Statements 23to47
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Board of Management and Advisers Management Board Mr Robbie Davis (Chairman) Professor Paddy Gray Mr Alan Hill (Honorary Secretary) Mr Michael Graham Mr John Beattie Dr Sara Templar (Vice Chairman) Mr Alex Ward Mrs Kelly Andrews (Honorary Treasurer) Gerard McGarry Martin Leahy Jacqueline Locke Chief executive Company secretary Mr Alan Hill (Honorary Secrelary) Registered office Unit 5 Citylink Business Park Albert streel Belfasl BT12 4HQ Solicitors Elliot Duffy Garrett 40 Linenhall Street Belfasl BT2 8BA Auditors RBCA Limited Linenhall Exchange 26 Linenhall Street Belfast BT2 8BG Company number IP000166 Status Registered under the Co-operative and Community Benefit Societies Act (Northern Ireland) 1969 - No. IP 166 Registered Charity with the Charity Commission for Northern Ireland - Charity Registration No.: NIC106095-0 Registered with the Dfc {Nll - Number 8 Registered with HMRC- Number XN 41599 Page 1
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 The Board of Management present their report and the audited financial statements for the year ended 31 March 2024 of Connswater Homes Limited (the "Association ). This report is also known as the Trustees, report for Charity law purposes. Principal activities The Association is an Industrial and Provident Society and is registered with the Department for Communities ("DfC") providing housing accommodation for those in need. It has charitable status with HM Revenue and Customs and is a registered charity with the Charity Commission for Northern Ireland. Board of Management The Board of Management meets regularly throughout the year. There are also various committees who meet regularly throughout the year. The Committees have responsibilily for development, housing management, maintenance and audit. Financial matters are reported directly lo the Board. The Board carries out an annual appraisal of its own performance and an annual appraisal of individual of individual Board Members. The Board of Management are the directors of the company and are the trustees of the charity. The Board of Management, who seNed the Association during the year, and up to the date of signing the financial slatements, were.. Mr Robbie Davis {Chairman) Dr Sara Templar (Vice Chairman) Mr Alan Hill (Honorary Secretary) Mrs Kelly Andrews (Honorary Treasurer) Mr John Bealtie Mr Michael Graham Professor Paddy Gray Mr Martin Leahy Mr Gerard McGarry Mr Alex Ward Mrs Nicola Barber (resigned 15106123) Mr Trevor Hampton (resigned 14102124) Page 2
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Performance for the year ended 31 March 2024 During the year Ihe number of homes in ownership increased to 1,262 from 1,205 at the end of the prior year representing 8 4.7 /0 increase in stock size for the Association. Turnover increased by 9.50/0 from £8,555,856 in 2022123 to £9,372,108 in 2023124. This increase is as a result of new homes added to the Association's stOGk during the year. An average annual inflationary rent increase of 5.90/0 on much of our existing stock also helped to boost turnover. Operating costs of £6,449,286 represent 690/0 of lurnover (2023.. 720A). The Association generated a surplus for the year of £1,523,018 giving a net margin of 16 /0 (2023.. 14'/0), which is better than sector average and broadly in line with the performance of the Association over the past fjmo years. The Association continuously invests in Ihe maintenance of OLSr existing stock of properties, ensuring our homes remain in great condition. To this end £1,059,280 was spent on planned maintenance (including capital) during the year. These works included 44 window and door replacements, 17 kitchen replacements and 2 complete property refurbishments as well as improvement works to the hall at Mersey Street Primary School. A programme of health and safety inspections was also completed including boiler servicing, smoke and carbon monoxide alarms testing, asbestos monitoring, legionella testing, periodic fixed wire testing and fire risk assessments. The Board has a set number of key performance indicators monitoring the operations of the Association on regular basis. Performance Indicator Actual 23124 Target 23124
85'/0 Emergency repairs carried out within 24 hours Urgent repairs carried out within 4 days Routine repairs carried out within 28 days Operating margin Net margin Gearing ratio Interest cover ratio 97% 800/0 93% 800/0 31° 300/0 104/0 <600/0 1.98 Nel debt per unit Voids as a 0/0 of Stock £30,491 <£38,000 <4°/0 Board members attendance at Board meetings 750/0 Housing management staff assisted tenants struggling on low incomes by offering welfare and general money management advice, including assistance with universal credit applications. Page 3
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Expected performance in the year ending 31 March 2025 The Association expects to maintain its level of operations and performance in 2024125. It is planned that 70 homes will be added to the development programme during the year made up of a number of schemes. We expect there will be approximately 68 properties completed from existing schemes on site and added lo management during the year with the remainder completing in the years ending 31 March 2026 and 2027. A cyclical and planned maintenance programme of approximately £1.6m of investment has been approved. This includes 10 heating upgrades, 50 bathroom upgrades, 55 window and door replacements, 30 new kitchens, 6 complete property refurbishments, external redecoration of 94 properties, internal decoration at one apartment scheme and all health and safety inspections. Corporate Governance In the opinion of Ihe Board of Management, the Association is in compliance with the Best Practice issued by the NHF Code of Governance and with the Dfc Regulatory Standards. Corporate Strategy The Association launched a new strategic plan in April 2022 covering the five year period 2022 to 2027. Our business goals over this period focus on working together and recognising diversity., striving to be more environmentally aware throughout our business and activities., promoting kindness, resilience and community cohesion,. being open and clear in our actions, rectifying mistakes and doing what we say we will do,. connecting with tenants, engaging with stakeholders and buddying up with others to improve our seNices. We will be working on these goals in a tough financial environment under the burden of welfare reform, political uncertainly and economic recovery following a global pandemic. It has never been more important to make sure value for money is embedded in our business,. to offer seNices that our tenants actually need and to look at the wider picture of challenging poverty, improving health and wellbeing and promoting inclusivity. Our strategy lo achieve this is to help our tenants to live in warm, safe, affordable homes. to provide added value through community initiatives, customer led service provision and reducing OLFr negative impact on the environment and by being a viable, forward thinking, environmentally aware business. We want to see houses become homes,. safe and well-maintained homes that complement their environment. We want to help our tenants to live comfortably in these homes, so making them more energy efficient and affordable is very important. We also aim to deliver excellence across our core housing service activities such as routine repairs, investing in planned maintenance, rent collection and peaceful living. Whilst striving for continuous improvemenl and service development we will be inclusive and mindful of the needs of our tenants. Our development priorities will be to nol only provide new affordable homes in thoughtfully designed developments that will stand the test of time, but also lo consider alternative models for their delivery and tenure. We will have an active asset management and investment strategy to maintain our homes. We will continue to enhance our customer engagement opportunities through collaboralive partnership with tenanls and key slakeholders as we work to innovate in delivery of services. Page 4
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Through information and practice we want to get involved in the sustainability agenda as we provide homes, enhance neighbourhoods and operate our business. Our tenants and employees will be encouraged to get involved in our efforts to reduce our carbon footprint. We will signpost our tenants to fuel poverty initiatives and offer welfare benefit advice. We want to be a great employer and an employer of choice. 11 is our people who make us great, they determine how we perform as an organisation and we want to empower them to be the best they can. We want to develop a staff team with skills, knowledge and motivation to deliver our goals. We want our team to feel valued and listened to,. to provide them with a working environment that is agile and safe and to ensure they have resources to perform at their best. As an organisation, we will meet, or exceed statutory and legal requirements, apply appropriate risk controls, develop and comply with internal policies and apply innovalive thinking to develop service efficiencies and deliver excellent customer focused services. Our business aclivities are underpinned by sustainability, regulation and collaborative working. We will assess a range of factors to ensure positive outcomes for all parts of our business including financial viability, value for money and environmental sustainability. We will raise staff awareness of energy efficiency and how to pass benefits on lo tenants. Digital transformation has never been more important and Connswater recognises that it is business Critical. We will ensure that the appropriate infrastructure, applications and systems are available in order for staff to deliver services in an efficient, consistent and cost-effective manner whilst ensuring clear and transparent governance. We will focus on improving customer access to services and data. This will be driven further by developing our tenant portal and improving access to equipment for tenants through our tablet loan scheme. Going Concern After making enquiries, the Board of Management have a reasonable expectation that the Association has adequate resources to continue in operational existence for the foreseeable future. For this reason they continue to adopt the going concern basis in preparing the financial statements. Page 5
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Value for Money Our strategy al Connswater Homes Limited is to operate our core aclivities as efficiently and effectively as possible. We strive lo improve the quality of our services to our tenants, continue building high quality homes and generate social value whenever we see the opportunity. VFM Framework - 3 E's The Association strives to achieve Value {i.e. be as effective as possible) for the money that is invested in the activities that we carry out. We measure our VFM using a framework which examines our performance in terms of Economy, Efficiency and Effectiveness. Treasury Management Policy The Associalion's aim is to maintain loan balances at a level to support development while keeping loan interest charges to a minimum. This is achieved without comprising the Association's ability to meet its financial obligalions al they fall due. Page 6
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Financial Risk Management The Association's operations expose it to a variety of financial risks that include the effects of changes in credit risk, price risk and interest rate risk. The Association has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the Association by regular review of activity levels against changing market conditions and adjustment to Gashflow projections accordingly. The Association liaises with lenders on an ongoing basis to keep up to dale with other products in the marketplace. Interest rate risk Exposure to fluctuating interest rates is managed by the composition of a balanced portfolio between fixed rate and variable rate loans. The Association's effective interest rate in 2023124 was 3.6 %. For the past number of years the Association's effective interesl rate has been falling year on year as the Association agreed competitive terms on new loans. We recognise that we now find ourselves in a changed economic environment and Ihat any new loans drawn down in future years are likely to be at considerably higher Interest rates. This will Gause our effective interest rate to increase in future years. Higher interest rates will pul a squeeze on Net Margins in years to come and our development plans will need to take accounl of this higher interest rate environment to ensure bank covenants are met. The Association runs stress testing scenarios each year to ensure our future plans are viable and we amend our plans where necessary. Liquidity risk The Association maintains a mixture of long-term and short-term loan finance that is designed to ensure there is sufficient funds to achieve business objectives and to facilitate planned growth. Currency risk The Association does not engage in foreign currency transactions and so is not exposed to exchange risk Regulation The Association's principal regulator is the Department for Communities {DfC). Their regulatory judgement for the year 2021122 gave the Association the highest rating of Level 1 assessing the three standards.. Governance, Finance and Consumer., the rating for 2022123 has not yet been received. As a registered charity the Association is also subject to regulation by the Charity Commission for Northern Ireland. Environmental matters The Association recognises its corporate responsibility to carry out its operations and development programme whilst minimising environmental impacts. The Board's conlinued aim is to comply with all applicable environmental legislation, prevent pollution and reduce waste wherever possible. Page 7
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Internal Financial Control The Board of Management is responsible for establishing and overseeing a risk management framework in order to safeguard the assets of Ihe Association and for the Association's systems of internal financial control and along with senior managemenl is responsible for establishing and operating detailed control and report procedures. The systems of internal financial control can provide over reasonable, and not absolute, assurance against material misstatement and loss. The Board of Management have reviewed the effectiveness of the Association's system of internal financial control. The review included consideration of Ihe business risks facing Ihe Association and of the existing internal financial control procedures. The key elements of the Gontrol system in operation are.. The Board has adopted 2 formal schedule of matters reserved for its approval ensuring it maintains responsibility for overall strategy, approval of all property transactions and other major capital expenditure projects. There is an organisation structure with clearly defined lines of responsibility and delegation of aulhorily. Detailed budgets are prepared covering the Association's businesses which are reviewed and approved by the Board. Actual results are Compared againsl budget and appropriate action identified and initiated. The Audit Committee review matters relating to internal control and receives reports on a regular basis from the external and internal auditors and from senior management. Page 8
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Statement of the Board's responsibilities in respect of the financial statements The Co-operative and Community Benefit Societies Act (Northern Ireland) 1969 and Registered Housing Association legislation require the members of the Board of Management to prepare the financial statements for each financial year which give a true and fair view of the state of the Association's affairs and of its surplus or deficit for Ihat period. In preparing these statements the Board is required to.. select suitable accounting policies and apply them consistently., make judgements and estimates that are reasonable and prudent., state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Association will continue to operate. The members of the Board of Management are responsible for keeping proper accounting records which disclose wilh reasonable accuracy at any time the financial position of the Association and to enable them to ensure that the financial statements Gomply with the Co-operative and Community Benefit Societies Act (Northern Ireland) 1969 and the Registered Housing Associations (Accounting Requiremenlsl Order (Northern Ireland) 1993. They have general responsibility for the taking of reasonable steps to safeguard the assets of the Association and to prevent and detect fraud and other irregularities. Events after the Balance Sheet date The Association has no post balance sheet date events to disclose. Charitable donations Donations totalling £2,385 (2023.. £3,555) were made by the Association during the year. No donations for political purposes were made during the year (2023.. £nil). Financial sustainability The Association has a robusl framework of longer term financial planning in place. The Board regularly considers the longer term financial plan which covers a 30 year period. The financial plan is prepared in accordance with FRS102 using Brixx planning software. The Association remains profitable for each of the 30 years in the plan and while gross margin remains strong, net margin is projected to fall to 4% in 2031 before rising again. Sensitivity analysis is carried out to see how the Association would cope financially under the following four stress factors.. voids increase by 1 % , bad debts increase by 10/0, CPI increases by 10/0 and interest rates increase by 10/0. This allows the board to consider whether the Association may need to amend or postpone future development plans should any of the above scenarios materialise. Page 9
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Report of the Board of Management for the Year Ended 31 March 2024 Statement of disclosure of information to auditors So far as each of Ihe members of the Board of Management at the date of approval of these financial statements is aware: there is no relevant audit information of which the Association's auditors are unaware, and that each Board member has taken all the steps that oughl to have have been taken as a Board member in order to be aware of any relevant audit information and to establish that the Association's auditors are aware of that information. Independent Auditors The auditors, RBCA Limited, have indicated their willingness to continue in office, and a resolution proposing their reappointment will be proposed at the Annual General Meeting. Approved and authorised by the Board on Mr Robbi avis (Chairman) Mr Alan Hill (Honorary Secretary) Mrs Kelly Andrews (Honorary Treasurer) Page 10
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Independent Auditor's Report to the Members of Connswater Homes Limited Opinion We have audited the financial statements of Connswater Homes Limited for the year ended 31 March 2024, which comprise the Statement of Comprehensive Income, Statement of Financial Position. Statemenl of Changes in Resources, Statement of Cashflows and Notes to the Financial Statements including a summary of significant accounling policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounling Slandards, including FRS 102 - 'The Financial Reporting Standard applicable in the UK and Republi¢ of Ireland, (United Kingdom Generally Accepted Accounting Practice) and the Statement of Recommended Practice for Social Housing Providers issued by the National Housing Federation. In our opinion the financial statements.. give a true and fair view of the state of the company's affairs as at 31 March 2024 and of its surplus 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 requirements of the Co-operative and Community Benefits Societies Act (Northern Ireland) 1969 (formerly the Industrial and Provident Societies Act (Northern Ireland) 1969), the Charities Act (Northern Ireland) 2008, The Charities (Accounts and Reports) Regulations (Northern Ireland) 2015 and the Registered Housing Associations (Accounting Requirements) Order (Northern Ireland) 1993. Basis of 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 responsibililies for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern We have nothing to report in respect of the following matters in relation to which the ISAS (UK) require us to report to you where.. the Board of Management's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate. or the Board of Management have not disclosed in the financial stalements any idenlified material uncertainties that may cast significant doubt about the Associalion's ability lo continue to adopt the going concern basis of accounting for a period of at least twelve months from the dale when the financial statements are authorised for issue. Other information The other informalion 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 othenmise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Page11
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Independent Auditor's Report to the Members of Connswater Homes Limited 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 otheNise 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 malerial misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Board of Management As explained more fully in the Board of Management responsibilities statement the Board of Management are is 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 Board of Management determines is necessary to enable the preparation of financial statements that are free from material misslatement, whether due to fraud or error. In preparing the financial statements, the Board of Management is responsible for assessing the Association'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 Board of Management either intend to cease operations, or have no realistic alternative but to do so. Auditor's responsibilities for the audit of the financial statements Our objeclives 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 Ihat 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. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below". We identified areas of laws and regulations that could reasonably be expected have a material effect on the financial statements from our sector experiences Ihrough discussion the Board of Management and other management (as required by auditing standards). We had regard to laws and regulations in areas that directly affect the financial statements including financial reporting and taxation legislation. We considered the extent of compliance with those laws and regulations as apart of our procedures on the related financial statement items. With the exception of any known or possible non-compliance, and as required by auditing standards, our work in respect was limited to enquiry of the Board of Management. We communicaled applicable laws and regulations throughout our audit team and remained alert to any indications of non-compliance throughout the audit. We addressed the risk of fraud Ihrough management override of controls, by testing the appropriateness of journal entries and other adjustments,. assessing whether the judgements made in making accounting estimales are indicative of a potential bias,. and evaluating the business rationale of any significant transaclions that are unusual or outside the normal course of business. Page 12
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Independent Auditor's Report to the Members of Connswater Homes Limited Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecling one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it. A further description of our responsibilities is available on the Financial Reporting Council's website at.. www.frc.org.uklaudilorsresponsibilities. This description forms part of our auditor's report. Other required reporting Co-operative and Community Benefit Societies Act (Northern Ireland) 1969 exception reporting Under the Co-operative and Community Benefit Societies Act (Northern Ireland) 1969, we are required to report to you if, in our opinion: A satisfactory system of control over transactions has not been mainlained., or We have not received all the information and explanations we require for our audil., or Proper accounting records have not been kept by the association., or The financial statements are not in agreement with the accounting records. We have no exceptions lo report arising from this responsibility. Charities (Accounts and Reports) Regulations (Northern Ireland} 2015 exception reporting Under the Charities (Accounts and Reports) Regulations (Northern Ireland) 2015 we are required to report to you if, in our opinion: 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. We have no exceptions to report arising from this responsibility. Use of our report This report is made solely to the Board of Management, in accordance with Article 38 of the Co-operative and Community Benefit Societies Act {Northern Ireland) 1969 (formerly the Industrial and Provident Societies Act (Northern Ireland) 19691. Our audit work has been undertaken so that we might slate lo the Board of Management those matters we are required to state to them in an audilor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility lo anyone other than the Board of Management and the Association as a body, for our audit work, for this report, or for the opinions we have formed. Page 13
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Independent Auditor's Report to the Members of Connswater Homes Limited Ross Boyd (Senior Statutory Auditor) For and on behalf of RBCA Limited, Linenhall Exchange 26 Linenhall Street Belfast BT2 8BG Date.. Page 14
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Statement of Comprehensive Income for the Year Ended 31 March 2024 (As restated) 2024 2023 Turnover Operating costs 9,372,108 6,449,286) 8,555,856 6,188,080) Operating surplus for the year Surplus arising from disposals of housing property Miscellaneous income Transfer to disposal proceeds fund Interest received Interest payable and similar expenses Other finance costs 2,922,822 (980,381) 12,522 980,381 59,505 (1,485,831) 14,000 2,367,776 110,427 36,595 (110,427) 16,279 {1,183,248) {25,000) 1,212,402 1,284,000 Surplus for the financial year Remeasurement gain on defined benefit pension schemes Total comprehensive income for the year 1,523,018 1,523,018 2,496,402 The notes on pages 23 to 47 form an integral part of these financial statements. Page15
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 (Registration number: IP000166) Statement of Financial Position as at 31 March 2024 (As restated) 2024 2023 Note Fixed assets Housing properties other tangible fixed assets Investments 13 16 17 150,140,070 436,483 141,660,372 367,189 150,576,555 142,027,563 Current assets Stocks Debtors Cash at bank and in hand 15 18 183,000 677,520 3,460,345 3,632,275 4,704,459 8,336,734 4,320,865 Creditors.. Amounts falling due wilhin one year Net current (liabilitiesllassets Total assets less current liabilities 19 {13,616,657 (4,190,322) {5,279,9231 130,543 145,296,632 142,158,106 (122,593,344) {120,977,836 22,703,288 21,180,270 Creditors.- Amounts falling due after more than one year Net assets 20 Capital and reserves Called up share capital Capital reserve Revenue reserve 12 80 22,703,196 12 80 21,180,178 Total funds 22,703,288 21,180,270 Approved and authorised by the Board on A)l.b ul Y*nd signed on its behalf by.. The notes on pages 23 to 47 form an integral part of these financial statements. Page 16
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 (Registration number: IP000166) statement of Financial Position as at 31 March 2024 Mr Robbie is (Chairman) Mr Alan Hill (Honorary Secretary) Mrs Kelly Andrews (Honorary Treasurer) The noles on pages 23 to 47 form an integral part of these financial statements. Page 17
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Statement of Changes in Reserves for the year ended 31 March 2024 2024 2023 (As restated) Note Total comprehensive income for the year 1,523,018 2,496,402 Nel addition to revenue reserves 1,523,018 21,180,178 2,496,402 18,683,776 Opening total revenue reserves Closing total revenue reserves 22,703,288 21,180,178 The notes on pages 23 to 47 form an integral part of these financial statements. Page 18
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Statement of Cash Flows for the Year Ended 31 March 2024 2024 2023 Note Net cash inflowloutflow from operating activities Returns on investments and servicing of finance Capilal expenditure and financial investment 6,346,272 {1,426,3261 {4,317,420) 2,491,523 (1,166,969) (3,092,485) Cash inflowloulflow before use of liquid resources and financing 602,526 (1,767,931) Financing 641,588 649,326 Inceasel{decrease) in cash in period 1,244,114 (1,118,605) 2024 2023 Reconciliation of net cash flow Increasel(decrease) in cash in period Net cash at 1 April 1,244,114 3,460,345 (1,118,605) 4,578,950 Net cash at 31 March 4,704,459 3,460,345 The notes on pages 23 to 47 form an inlegral part of these financial statements. Page 19
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to Statement of Cash Flows for the Year Ended 31 March 2024 2024 2023 Note A Reconciliation of surplus for the year to operating cashflows Surplus for the year Deprecialion Amortisation of grant Movements.. 1,523,018 2,215,259 (1,577,459) 1,212,402 2,067,384 {1,560,170) Stock 183,000 (2,954,755) 4,074,502 980,381 490,000 (14,000) (59,505) 1.485,831 39,500 50,171 2,334,694 {110,4271 12,734,000) 25,000 (16,279) 1,183,248 Debtors Creditors (Surplus)Jdeficit arising from disposals of housing property Difference in pension charge and cash contributions Other finance costs Interest received Interest payable 6,346,272 2,491,523 The notes on pages 23 to 47 form an integral part of these financial statemenls. Page 20
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to Statement of Cash Flows for the Year Ended 31 March 2024 2024 2023 Note B - Analysis of cash flows for headings netted in the cash flow statement Returns on investment and servicing of finance Interest received 59,505 11,485,831) 16,279 {1,183,248) Interest payable Net cash inflowl (outflow) for returns on investment and seNicing of finance {1,426,326) (1,166,969) 2024 2023 Capital expenditure and financial investment Other fixed assets (128,489) (10,334,819) 5,314,968 830,920 (230,999) {10,916,389) 7,224,983 829,920 Housing, land and buildings Capital grant received Sales proceeds Net cash inflowl (outflow) for capital expenditure and financial inveslment {4,317,4201 13,092,485) 2024 2023 Financing Loan principal payments Loan redemptions Draw-downs {1,358,412) {1,350,674) 2,000,000 2,000,000 Net cash inflowl (outflow) for capital expenditure and financial investment 641,588 649,326 The notes on pages 23 to 47 form an integral part of these financial statements. Page 21
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to Statement of Cash Flows for the Year Ended 31 March 2024 At 1 April 2023 Other At 31 March Changes 2024 Cashflows Note C - Analysis of changes in net funds Cash in hand and at bank 3,460,345 1,244,114 (1,364,755) (5,181,843) (38,034,401) 1,540,254 4,704,459 (6,546,598) (36,494,147) Debt due within one year Debt due after more than one year (35,938,811) {2,397,4751 {38,336,286) The notes on pages 23 to 47 form an integral part of Ihese financial statements. Page 22
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 l General information The associalion's principal activity during the financial year was providing high quality, affordable homes for rent throughout Northern Ireland. The association is registered under the Co-operative and Community Benefit Societies Act (Northern Ireland) 1969 and domiciled in the UK. The address of ils registered office is.. Unit 5 Citylink Business Park Albert Street Belfast BT12 4HQ 2 Accounting policies Summary of significant accounting policies and key accounting estimates The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otheiSe stated. Statement of compliance These financial statements of Connswater Homes Limited have been prepared on the going concern basis in compliance with United Kingdom Accounting Standards, including Financial Reporting standard 102, "The Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland ("FRS 102") under the historical cost convention, and in accordance with the applicable accounting slandards in the United Kingdom and Statement of Recommended Practice for Accounting by Registered Social Landlords. The principal accounting policies, which have been applied consistently throughout the year, are set out below. The presentation of the financial statements complies with the Registered Housing Associations (Accounting Requirements) Order (Northern Ireland) 1993. Basis of preparation These financial statements are prepared on a going concern basis, under the historical cost convention. The preparalion of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the association accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3. Foreign currency transactions and balances Transactions and non-monetary assets, denominaled in foreign currencies, are translated at the exchange rale at the date of the Iransaction. Monetary assets and liabilities are denominated in foreign currencies are retranslated at the rate of exchange ruling at the statement of the financial position date or the exchange rate of a related foreign exchange contract where relevant. The resulting exchange gains or losses are dealt with in the income and expenditure account. Page 23
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Revenue recognition Revenue is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied or services rendered, nel of returns, discounts and rebates allowed by the association and value added taxes. The association bases its estimate of returns on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Where the consideration receivable in cash and cash equivalents is deferred and the arrangement constitutes a financing transaction, the fair value of the consideration is measured al the the present value of all future receipts using the imputed rate of interest. The association recognises revenue when (a) the significant risks and rewards of ownership have been transferred to the buyer., (bl the association retains no continuing involvement or control over the goods., {cl the amount of revenue can be measured reliably., (d) it is probable that future economic benefits will flow through the association and (e) when the specific criteria relating to each of the associations, sales channels have been met, as described below and in note 4. Net rental income Income includes rent and service charge income arising from the provision of housing accommodation and the amortisation of Housing Association Grant. Income is recognised in the period to which it relates. Employee benefits The association provides a range of benefits to employees, including paid holiday arrangements and defined benefit pension plans. i) Short term benefits Short term benefits, including holiday pay and other similar non-monetary benefits, are recognised as an expense in the period in which the service is received. ii) Mulli-employer pension plan Retirement benefits to employees of the Association are provided by the Northern Ireland Local Government Officers Superannuation Committee (NILGOSC) defined benefit scheme which is externally funded. The assets of the NILGOSC scheme are held separalely from those of the Association. The Associalion has implemented a change in accounting policy as regards the recognition of defined benefit pension assets in the financial statements. This is in line with increasing industry practice of applying the principles of IFRIC 14 to FRS reporting. IFRIC 14 requires allowance to be made for a minimum funding requirement, which has the effect of limiting the amount of economic benefit available lo the excess of the value of prospective current service costs above Ihe current funding requirement. Stock Housing properties held for sale are measured at the lower of cost and estimated selling price less costs to complete and sell. Page 24
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Tangible fixed assets Housing properties The association operates a full component accounling policy in relation to the capitalisation and depreciation of its compleled housing stock. Housing Assoclation Grant and other grants Housing Association Grant and other grants received as a contribution towards the capital costs of housing properties of the Association were set against the capital cost of these properties in the prior years. Housing Association Grant is disclosed as "Creditors.. amounts falling due after more than one yearf, rather than set against the capilal Gost and are amortised to the Statement of Comprehensive Income as per the turnover policy. Housing Association Grant received against revenue expenditure is credited lo revenue in the period in which the related expenditure is charged. Such grants, although treated as a grant for accounting purposes, may be repayable under certain ircumstances, primarily following the sale of housing property, bul any amount repayable would be restricted to the net proceeds of the sale. Depreciation and impairment Housing properties Housing properties are split belween land, structure and major Components which require periodic replacement. Replacement or refurbishment of such major components is capitalised and depreciated over the estimated useful life which has been set taking into accounl professional guidance and Ihe association's asset management strategy. In determining the remaining useful lives for the housing stock, the association has taken accounl of views provided by both internal and external professional sources. Freehold land is not subject to depreciation. Depreciation is charged so as to write down the cost or valuation of the freehold housing properties and major components on a straight-line basis over their expected useful economic lives. Major components are treated as separable assets and depreciated over their expected useful economic lives or the lives of the structure to which they relate, if shorter, over the following periods.. Asset class Depreciation method and rate Land Not depreciated Structure (including roofj 100 years Kitchen 20 years Bathroom 25 years Heating system 15 years Windows and doors 35 years Electrics 30 years Page 25
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Housing assets are depreciated in the month of acquisition, or in the case of a larger project, from the monlh of completion. Where there is evidence of impairment, the fixed assets are written down to the recoverable amount and any write down would be charged lo the operating surplus. Other fixed assets Ground rents are depreciated. Depreciation of other fixed assets is charged on a slraight-line basis over the eslimated useful economic lives of the assets at the following annual rates.. Office premises 20/0 Office furniture and equipment 250/0 Motor vehicles 1401, Subsequent additions and major components Subsequent costs, including major inspections, are included in the assets carrying amount or re¢ognised as a separate asset, as appropriate, only when il is probable that economic benefits associated with the item will flow to the associalion and the cost can be measured reliably. The Garrying amount of any replaced component is de-recognised. Repairs, maintenance and minor inspection costs are expensed as incurred. Derecognition Tangible assets are de-recognised on disposal or when no future economic benefits are expected. On disposal the difference between the net disposal proceeds and the carrying amount is recognised in the Statement of Comprehensive Income. Leases Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to Slatement of Comprehensive Income on a straight-line basis over the period of the lease. Page 26
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Cash and cash equivalents Cash and cash equivalents comprise cash on hand, deposits held al call with banks, other short-term highly liquid investments wilh original maturities of one month or less and bank overdrafts. Bank overdrafts are shown wilhin borrowings in current liabilities. Impairment of non-financial assets At each Statement of financial position date non-financial assets are nol carried at fair value are assessed to determine whether there is an indication Ihat the asset {or asset's cash generating uniti may be impaired. If there is such an indication the recoverable amount of Ihe asset (or asset's cash generating unit) is compared to the carrying amount of the asset (or asset's Gash generating unit). The recoverable amount of Ihe asset (or asset's cash generating unit) is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of the future cash flows before interest and tax obtainable as a result of the asset's (or assel's cash generating unit) Gontinued use. These cash flows discontinued using a pre-tax discount rale that represents the current markel risk-free rate and the risks inherent in the assets. If the recoverable amounl of the asset {or asset's cash generating unit) is estimated to be lower than the carrying amount, the carrying amount is reduced to its recoverable amount. An impainnent loss is recognised in the Statement of Comprehensive Income and Retained Earnings, unless the asset has been revalued when the amount is recognised in olher comprehensive income to the extent of any previously recognised revaluation. Thereafter any excess is recognised in the Statement of Comprehensive Income and Retained Earnings. If an impairment loss is subsequently reversed, the carrying amount of the asset (or asset's cash generating unit) is increased lo the revised estimate of its recoverable amount, but only to the extent that the revised carrying amount does not exceed the carrying amount that would have been determined {net of depreciation or amortisationl had no impairment loss been recognised in prior periods. A reversal of an impairment loss is recognised in the Statement of Comprehensive Income and Retained Earnings. i) Provisions Provisions are recognised when the Association has a present legal or construction obligation as a result of past events,. it is probable that an outflow of resources will be required to settle the obligation., and the amount of the obligations can be estimated reliably. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligalions as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. Provisions are measured at the present value of the expenditures expected lo be required to settle the obligation using a pre-tax rate that reflects current market assessments of Ihe lime value of money and the risks specific lo the obligation. The increase in the provision due to passage of time is recognised as a finance costs. 11> Contingencies Conlingenl liabililies, arising as a result of past events, are not recognised when (i) it is not probable that there will be an outffow of resources or that the amount cannot be reliably measured at the reporting date or (ill when the existence will be confirmed by the occurrence of uncertain future events not wholly within the Association's control. Contingent liabilities are disclosed in the financial statements unless the probability of an outflow of resources is remote. Page 27
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Financial instruments The association has chosen to adopt Sections 11 and 12 of FRS 102 in respecl of financial instruments. i) Financial assets Basic financial assets, including trade and other receivables and cash and bank balances initially recognised al transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Such assets are subsequently carried at amortised cost using the effeGlive interest method. At the end of each reporting period financial assets at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in Statement of Comprehensive Income and Retained Earnings. If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in Slatement of Comprehensive Income and Retained Earnings. Financial assets are de-recognised when {al the contractual rights to Ihe cash flows from the asset to expire or are settled, (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or, {c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset lo an unrelated third party without imposing additional restrictions. Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in the Statement of Comprehensive Income and Retained Earnings, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment. Page 28
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 ii) Financial liabilities Basic financial liabilities, including trade and other payables, bank loans and loans from fellow association companies, are inilially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate of method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this Gase, the fee is deferred until the draw-down occur. The extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates. Trade payables are obligations to P8y for goods or services that have been acquired in Ihe ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method. Disposal proceeds fund The net surpluses, after loan repayments, that arise from the sale of property to tenants under the voluntary purchase grant arrangements instituted by the Department for Communities can be used by the Association to fund works on property that would not be eligible for housing association grant or in certain circumstances, attract loan finance. If the surpluses are not used within two years of their receipt they may be payable in part or in full to the Department of Communities. Revenue reserves The Association's policy is to retain a level of revenue reserves which reflects its needs at the current time and in the foreseeable future. The reserves required are sufficient to meet committed running costs for a period equivalent to nine months budgeted future expenditure. The Board of Management reviews the adequacy of the revenue reserves level on an annual basis. Share capital Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis. Going concern After making appropriate enquires, the Board of Management has a reasonable expectation that the Association has adequate resources to continue in operational existence for the foreseeable future. For this reason, it continues to adopt the going concern basis in the financial statements. Page 29
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 3 Critical accounting judgements and estimation uncertainty Estimates and judgements made in the process of preparing the association financial statements are continually evaluated and are based on historical expenses and other factors, including expectations of future events that believed to be reasonable under the circumstances. (a) Critical judgement in applying the entity's accounting policies There are no critical judgements in applying the entity's accounting policies. {b) Critical accounting estimates and assumptions The Board of Management makes estimates and assumptions concerning the future in the process of preparing the association financial statements. The estimates and assumptions that have a significant risk of causing a material adjuslment lo the carrying amounts of assels and liabilities within the next financial year are addressed below. (i) Useful economic lives of housing properties The annual depreciation on housing properties is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reviewed annually. They are amended when necessary to reflect current estimates, based on future investments, economic utilisation and the physical condition of Ihe assets. (li) Defined benefit pension scheme The Association has an obligation to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including,. life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Managemenl estimates these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends. There are no other critical accounting estimates and assumptions. Page 30
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 4 Analysis of turnover Turnover and results relate to the association's main activities which are carried out in the United Kingdom. Turnover represents rental and service charge income and residential charges for housing with care, net of voids. It also includes amortisation of grants received from the Northern Ireland Housing Executive. 5 Operating costs 2024 2023 Direct costs 4,376,280 2,073,006 4,283,608 1,904,472 Administrative expenses 6,449,286 6,188,080 6 Operating surplus 2024 2023 This is stated after chargingl(creditingl: Staff costs {Note 7) Wages and salaries Depreciation Housing properties Other tangible fixed assets Amortisation of grants Auditors, remuneration 2,010,600 1,747,479 2,162,863 52,396 <1,690,092) 2,014,989 52,395 (1,560,170) Audit services 8,100 8,100 Page 31
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 7 Employee information 2024 2023 Staff costs Wages and salaries Social security costs Other pension costs 1,561,139 165,642 283,819 1,354,206 146,121 247,152 2,010,600 1,747,479 2024 2023 Number Number Average monthly number of persons employed during the year by activity: Administration 34 33 8 Directors, emoluments The aggregale remuneration of key management personnel of the Association during the year was.. 2024 2023 Aggregate emoluments {including pension contributions) Emoluments payable to the highest paid director (excluding pension contributions) 377,833 356,599 130,902 123,028 The number of directors lo whom emoluments were paid during the year falls wilhin each of the following bands.. Page 32
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 2024 2023 Salary Band £130,000 - £140,000 £120,000 - £130,000 £110,000 - £120,000 £100,000 - £110,000 £90,000 - £100,000 £80,000 - £90,000 £70,000 - £80,000 Members of the Board of Managemenl serve in a voluntary capacity and none (2023.. none) were in receipt of emoluments during the year. The Board and Committee members were reimbursed for expenses totalling £Nil (2023.. £Nil) during the year. 9 Transfer of disposal proceeds fund 2024 2023 Proceeds of disposal Asset original costsllegal fees Voluntary grant payable 135,000 {55,7851 44,160 830,920 {305,7731 164,281 Transfer lo disposal proceeds fund (note 19> 123,375 689,428 10 Interest receivable and similar income 2024 2023 Interest receivable 59,505 16,279 59,505 16,279 Page 33
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 11 Interest payable and similar expenses 2024 2023 Housing property loans Bank interest and charges 1,481,189 4,642 1,179,138 4,110 1,485,831 1,183,248 12 Other finance costs 2024 2023 Defined benefil pension scheme net interest cost {14,000) 25,000 (14,000) 25,000 Page 34
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 13 Tangible fixed assets - housing properties and housing association grants 2024 2023 Housing Properties Cost At 1 April 2023 Additions 159,677,552 10,794,814 {459,995) 149,545,851 11,453,944 (1,322,243) Disposals Transfers At 31 March 2024 170,012,371 159,677,552 Accumulated depreciation At 1 April 2023 Charge for the year Disposals Transfers 18,017,181 2,162,863 (307,743) 16,362,417 2,014,989 (360,225) At 31 March 2024 19,872,301 18,017,181 Net book value At 31 March 2024 150,140,070 141,660,372 Net book amount comprises: Freehold property 150,140,070 141,660,372 Net book amount comprises". Completed scheme Properties under construction 137,253,470 12,886,600 127,508,388 14,151,984 At 31 March 2024 150,140,070 141,660,372 Included in the above is a figure of £547,072 for Gapitalised component replacements (2023: £393,425). Page 35
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 14 Housing Association Grants 2024 2023 Housing Association Grants Cost At 1 April 2023 Additions 99,052,850 5,649,836 {334,868) 91,492,175 8,542,674 (981,998) Disposals At 31 March 2024 104,367,818 99,052,850 Accumulated amortisation Al 1 April 2023 Charge for the year Disposals 15,194,212 1,577,459 (262,734) 14,279,783 1,462,482 1547,999) At 31 March 2024 16,508,936 15,194,212 Net book value At 31 March 2024 87,858,882 83,858,638 Page 36
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 15 Stock 2024 2023 Houses held for sale 183,000 183,000 16 Other tangible assets Ground Rents Office Building Office Equipment Motor Vehicles Total Cost At 1 April 2023 Additions 839 398,944 117,328 430,371 11,161 58,223 888,377 128,489 At 31 March 2024 839 516,272 441,532 58,223 1,016,866 Accumulated amortisation At 1 April 2023 Charge for the year 133,747 26,053 379,123 24,825 8,318 8,318 521,188 59,196 At 31 Mar¢h 2024 159,800 403,948 16,636 580,384 Net book value At 31 March 2024 839 356,472 37,584 41,587 436,483 At 31 March 2023 839 265,180 51,248 49,905 367,189 Page 37
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 17 Investments Investments Cost and net book value At 1 April 2023 and 31 March 2024 Investments Detailed Name EPIC Clean Limited Principal Activity Country of Incorporation Dormant Company Northern Ireland Registered Address Unit 5 Citylink, Business Park, Albert Street, Belfast BT12 4HQ Holding Class of Share Ordinary 18 Debtors 2024 2023 Rental Debtors Gross - Technical 261,778 243,293 {140,808) 200,389 207,307 (140,808) Rental Debtors Gross - Non Technical Provision for Bad Debts Net rental {including rates, service charges) debtors 364,263 266,888 Other Debtors 3,131,408 136,604 276,018 84,856 49,758 Prepayments and accrued income Housing Association Grant receivable 3,632,275 677,520 Page 38
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 19 Creditors: amounts falling due within one year 2024 2023 {As restated) Bank loans 6,530,882 15,716 1,811,748 28,082 1,349,039 15,716 1,738,961 30.747 321,322 123,101 278,580 332,856 THFC premium Housing Association grants Rent, rates and seNice charges received in advance Disposal proceeds fund Other creditors 288,669 4,510,233 431,327 HAG received in advance Accruals and deferred income 13,616,657 4,190,322 20 Creditors: amounts falling due after more than one year 2024 2023 {As restated) Bank loans 32,261,224 4,232,923 33,785,131 4.249,271 659,059 82,119,677 164,698 THFC premium Disposal proceeds fund Housing Association grants Other grants 86,047,135 52,062 122,593,344 120,977,836 The surplus on the disposal proceeds fund must be used within two years of the sale of the property. In the prior year, housing associated grants falling due after more than one year were overstated by £1,738,961 and housing associated grants falling due within one year were understated by £1,738,961. Adjuslments to correct the above misstatement have been made to the comparative financial information. Page 39
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 21 Loans 2024 2023 Bank loans - Housing property and other loans Less than one year, or on demand (Note 18) Behmeen one and two years Between two and five years After more than five years 6,546,598 776,826 11,329,747 24,387,574 1,364,755 6,543,719 11,475,575 20,015,107 43,040,745 39,399,157 Security Loans are secured by way of mortgages upon Ihe deeds of the related housing properties. 22 Other grants As at 1 April 2023 Grant amortisation 164,698 112,636 As at 31 March 2024 52,062 23 Called up share capital Ordinary shares of £1 each, fully paid As at 1 April 2023 12 As at 31 March 2024 12 Page 40
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 24 Turnover, operating costs and operating surplus 2024 2023 Operating Operating Operating Operating Turnover Costs Surplus Surplus Social Housing Activities Non-social Housing Activities 9,372,108 6,447,453 2,924,655 2,373,950 1,833 (1,833) {6,174) 9,372,108 6,449,286 2,922,822 2,367,776 25 Housing stock Number of units owned on 31 March 2024 2023 Number Number Self-contained General needs housing 1,262 1,205 1,262 1,205 26 Turnover, operating costs and operating surplus or deficit from social and non-social housing activities - Association 2024 2023 Social Housing Activities Operating income Renl and rates receivable 7,615,195 103,621 1,690,092 (36,800) 6,948,461 90,425 1,557,079 {40,108) Service charges receivable Income from Housing Associalion grant Voids Total social housing income 9,372,108 8,555,856 Operating costs SeNices 255,031 1,082,298 881,083 990,708 110,135 1,279,554 813,987 903,403 Management costs Rates Maintenance and administration costs Page 41
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Planned and cyclical maintenance Reactive maintenance 512,208 541.541 2,170,114 14,470 518,585 528,136 2,014,989 13,117 Depreciation of social housing Bad debts (rent and seNice charges) Total social housing expenditure 6,447,453 6,181,906 Operating surplus on social housing 2,924,655 2,373,950 2024 2023 Dfc Allowances Management allowances Management costs 488,466 {1,200,046) 471,240 (1,097,821) Deficit (711,580) (626,581) Maintenance Allowances Maintenance Allowances 569,531 (512,2081 (541,541) 543,083 (518,5851 <528,1361 Planned and cyclical maintenance Reactive maintenance Deficit (484,218) (503,638) Technl¢al and Non - Technical Income Technical 5,762,095 1,956,721 5,254,526 1,784,357 Non-Technical Total 7,718,816 7,038,884 2024 2023 Non-social Housing Activities Operating costs Development costs written off 1,833 6,174 Total non-social housing expenditure 1,833 6,174 Operating loss on non-social housing 1,833 {6,174) Page 42
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 27 Pension commitments The Association operates a defined benefit pension plan for qualifying employees providing benefits based upon final pensionable pay. The pension plan is funded by the payment of conlributions and assets of the plan are held in a separately administered fund. The most recent comprehensive actuarial valuation of pension plan assets and the present value of the defined benefit obligation was carried out at 31 March 2024 by a qualified actuary for the purpose of the disclosures below. 2024 2023 2022 2021 Rate of increase in salaries 4.10, 4.10% 4.180/0 Rate of increase in pensions in payment Pension accounts revaluation date 2.60°/0 2.60°/0 2.280/0 2.60% 2.280/0 2.0% Discount rate 4.700/0 2.70 % 2.25 % Inflation assumption 2.60 /0 2.0% The mortality assumptions used were as follows.. 2024 2023 2022 2021 Years Years Years Years Longevity at age 65 for current pensioners: -men 21.7 22.2 21.8 21.9 - Women 24.6 25.0 25.0 25.1 Longevity at age 65 for future pensioners: -men 22.7 23.2 23.2 23.3 - Women 25.6 26.0 26.4 26.5 Page 43
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Pension Commitments {continued) Value at 31 March 2024 Value at 31 March 2023 The assets in the scheme and the expected rate of return were.. Equities Propety Bonds 43.70 40.00/0 9.70 11.20/0 21.6% 23.60/0 Gilts 25/0 25.2°/o 100/. 2024 2023 Reconciliation of present value of scheme liabilities At 1 April Current service cost 5,447,000 288,000 252,000 109,000 (125,0001 (34,000) 7,117,000 440,000 193,000 95,000 {2,369,000) (29,0001 Interest cost Member contributions Actuarial lossesl(gains) Benefits paid At 31 March 5,937,000 5,447,000 Page 44
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 2024 2023 Reconciliation of fair value of scheme assets At 1 April Interest income on assets 5,595,000 266,000 337,000 284,000 109,000 (34,000) 6,049,000 168,000 {93,700) 249,000 95,000 (29,000) Remeasurement gains on assets Contributions by the employer Contributions by participants Net benefits paid out At 31 March 6,557,000 5,595,000 2024 2023 £'ooo £'ooo Analysis of amount charged to income or expenditure are as follows: Currenl service costs 288,000 (14,000) 440,000 25,000 Interest on pension scheme liabilities Lossl(gain) on plan introductions, changes, curtailments and settlements 274,000 465,000 2024 2023 £'ooo £'ooo Amounts recognised in other comprehensive income Return on plan assets excluding interest income Actuarial lossesl{gains) 337,000 {495,000) 937,000 (2,369,000) (158,000) (1,432,000) Page 45
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 Amounts for current and previous three years: 2024 2023 2022 2021 (As restated) Fair value of employer assets Present value of defined benefit obligation Unrecognised asset 6,557,000 5,595,000 6,049,000 5,446,000 {5,937,000) (5,447,000) {7,117,000)16,769,000) (620,000) (148,000) Surplusl{deficit} {1,068,000) {1,323,000) 28 Prior Period Adjustment During the year the Association has implemented a change in accounting policy as regards the recognition of defined benefit pension assets in the financial statements. This is in line with increasing industry practice of applying the principles of IFRIC 14 to FRS reporting. IFRIC 14 requires allowance to be made for a minimum funding requiremenl, which has the effect of limiting the amount of economic benefit available to the excess of the value of prospective current service costs above the currenl funding requirement. The effect of this change has been to restrict the amount of the Association's pension surplus to nil as at 31 March 2024. Given there has been a change in accounting policy, a prior year adjustment has been made to amend the comparative figures in the 2024 financial statements as follows.. As reported 2023 Adjustment Restated 2023 Pension Surplus 148,000 (148,0001 As reported 2023 Adjustment Restated 2023 Surplus for the financial year 1,212,402 1,212,402 Remeasurement gain on defined benefit pension schemes 1,432,000 (148,0001 1,284,000 Total comprehensive income for the year 2,644,402 2,496,402 Page 46
Connswater Homes Limited Annual report and Financial statements for the year ended 31 March 2024 Notes to the Financial Statements for the Year Ended 31 March 2024 29 Capital Commitments 2024 2023 Capital expenditure Contracted for but not provided for in the financial statements 21,605,690 6,921,882 The Association anticipates that this expenditure will be funded by Housing Association Grant from the Department for Communities, by private finance, both external and internal and the association's reserves. 30 Contingent liabilities There exists a contingent liability on the Association of the possibility of having to repay grants received on properties if any properties are sold. This also includes any grants written off through the implementation of component accounting. 31 Related party disclosures Connswater Homes Limited is an admitted body to the Northern Ireland Local Government Officers. Superannuation Committee {NILGOSC) and make contributions on behalf of those of its employees whom are in the scheme. 32 Ultimate controlling party The ultimate controlling party is the Board of Management. Page 47