Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **ANGUS HOUSING ASSOCIATION LIMITED REPORT AND FINANCIAL STATEMENTS For the year ended 31st March 2026** 


**Registered No. 1665R(S) Scottish Charity No. SC020981 The Scottish Housing Regulator No. HAL65** 




Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **REPORT AND FINANCIAL STATEMENTS** 

## **For the year ended 31st March 2026** 

||**Page**|
|---|---|
|Board Members and Advisors|2|
|Report of the Board of Management|3 - 13|
|Report of the Auditors|14 – 17|
|Report of the Auditors on Corporate Governance Matters|18|
|Statement of Comprehensive Income|19|
|Statement of Financial Position|20|
|Statement of Changes in Reserves|21|
|Statement of Cash Flow|22|
|Notes on Financial Statements|23 – 41|



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## **Board Members and Advisors** 

## **For the year ended 31st March 2026** 

## **MEMBERS OF BOARD OF MANAGEMENT** 

|Mr C Irvine|Chair|
|---|---|
|Ms H Farquhar||
|Mr I McDonald||
|Mrs J Gaul||
|Mr A Jack|(resigned 08.04.2026)|
|Mrs L McDonald|Vice Chair|
|Mrs C Glenn||
|Mr S Parsley||
|Ms J Martin|(elected 20.08.2025) (resigned<br>29.05.2026)|
|Mrs H Whyte|(elected 11.02.2026)|
|Mr A Conway|(elected 11.02.2026)|
|Mrs E Kane|(elected 11.02.2026)|
|Mr N Nicholson|(elected 08.04.2026)|
|Mrs A Wallace|(elected 08.04.2026)|
|Mrs J Lawrence|(elected 08.04.2026)|
|Mr S Storrie|(resigned 27.08.2025)|



## **KEY MANAGEMENT PERSONNEL** 

Gail Robertson Chief Executive Officer Kevin Lynch Director of Asset Management Director of Finance and Corporate Services (retired Arlene Grant 31.05.2026) Director of Finance and Corporate Services Angela Murphy (appointed 30.03.2026) Linlay Anderson Director of Housing Services 

## **SECRETARY AND REGISTERED OFFICE** 

Mrs G Robertson, 93 High Street, Arbroath, DD11 1DP. 

## **SOLICITORS** 

Thorntons Law LLP, Whitehall House, 33 Yeaman Shore, Dundee, DD1 4BJ. 

TC Young Solicitors, Melrose House, 69a George Street, Edinburgh, EH2 2JG 

## **BANKERS** 

The Royal Bank of Scotland plc, Brothock Bridge, Arbroath, DD11 1NP. Flagstone Investment Management, 1[st] Floor, Clareville House, 26-27 Oxendon Street, London, SW1Y 4EL. Nationwide Building Society, Kings Park Road, Moulton Park, Northampton. BB3 6NW. 

## **EXTERNAL AUDITORS** 

CT Audit Limited, Chartered Accountants & Statutory Auditor, 61 Dublin Street, Edinburgh, EH3 6NL. 

## **INTERNAL AUDITORS** 

Quinn Internal Audit and Business Advisors, 4 Grosvenor Gardens, Edinburgh, EH12 5JU. 

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Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **REPORT OF THE BOARD OF MANAGEMENT** 

## **For the year ended 31st March 2026** 

The Board of Management presents its report and the Financial Statements for the year ended 31 March 2026. 

## **OBJECTIVES AND STRUCTURE** 

The Association’s broad objective is to contribute to providing high quality, affordable housing for all those individuals, families and communities in Angus and Dundee who are in need of the fundamental human right of a decent, secure home to call their own. 

The Association aims to achieve this objective by providing good quality homes for rent and shared ownership at an affordable cost to our tenants, ensuring the criteria we use to control access to our houses is based solely on the housing needs of applicants. The Association provides an efficient, responsive and personal housing management and maintenance service of the highest possible quality. 

The Board comprises twelve registered members, in the year to 31 March 2026, and has four subcommittees, which deal with service delivery, development, remuneration and finance, audit, and risk. Board members come from a diverse range of backgrounds and professional experience. The Board of Management meets six times per annum, whilst the sub-committees meet at least four times per annum, except for the remuneration and development sub-committees, which meets at least twice per annum. Members of the Board of Management receive no remuneration for their services except for reasonable out of pocket expenses. 

The Board of Management receives reports from the sub-committees, receives information on current developments in progress and on possible future sites, considers budgets and management accounts, all policy matters and other relevant business. The day-to-day management of the Association is delegated to the Chief Executive Officer and Senior Management Team. 

## **REVIEW OF THE YEAR** 

The Board of Management is pleased to report a surplus for the year of £1,431,118 (2025: £1,649,252). The stock increased by 56 to 2206. The Statement of Financial Position shows a net asset position of £24,867,584 (2025: £23,204,463). 

Whilst inflation has reduced, there is still significant financial pressure on our tenants. Housing Management staff ensured that tenant arrears were kept under control with the ARC figure for 2025/26 reported at 2.44% This is a decrease from 2.54% in 2024/25. We attribute the decease to the sustained efforts from our housing team and from the support and assistance provided by our Financial Inclusion Team. 

## **RESERVES** 

The Association needs to have reserves to ensure the organisation can function into the future and meet its liabilities, including the major repairs and investment needs of its properties. The revenue reserve of £23,867,540 reflects primarily the past investment in the housing stock and reserves for future major repairs and development. The Association has a cash level of £15,600,864 to support its future plans and operating requirements. The Association reviews its maintenance spending plans regularly and reassesses them in relation to reserves and cash flow. 

## **STRUCTURE, GOVERNANCE** 

The members of the Board of Management and the Senior Management Team are listed on page 2. 

Each member of the Board of Management holds one fully paid share of £1 in the Association. The Senior Officers hold no interest in the Association’s share capital and, although not having the legal status of Directors, they act as Executives within the authority delegated by the Board of Management. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

It is the responsibility of the Board of Management to undertake the strategy, setting of policy and overall direction of the Association. They also monitor the operational activities of the Association. The members of the Board of Management are unpaid volunteers. 

Our governing body is our Board of Management, which is responsible to the wider membership. The Board of Management members serve in a voluntary capacity, and we recognise that this puts even more onus on us to ensure that we set and achieve a high standard of professionalism in our work. We take governance very seriously, and in the last year we have continued to build on work from previous years which strengthened our governance arrangements. 

As part of our commitment to good governance and compliance, we submitted all statutory returns on time and our level of engagement with the Scottish Housing Regulator remains low with the status of Compliant. 

## **BOARD RECRUITMENT AND TRAINING** 

As volunteers, the Board of Management give freely of their time, knowledge and experience and the Association recognises the significant commitment and contribution they make to the running of AHA. Recruitment and retention of Board members is an ongoing issue. 

At Year End 2025/26, the Board had 12 members. Board members participated on cyber security training, HR, assurance statements, business planning and performance against benchmarks provided by the SHN (Scottish Housing Network). 

The Association was deemed Compliant by the SHR which followed the submission of the 2025/26 ARC (Annual Return on Charter) in May 2026 and the Annual Assurance Statement in October 2025. The SHR also considers the Association’s loans and financial position in making this determination. Board appraisals were carried out as per policy. 

## **ELECTION OF BOARD OF MANAGEMENT** 

In terms of the Rules of the Association, one third of the Board must resign. 4 members of the Board of Management; Mrs C Glen, Mrs L McDonald, Mrs J Gault and Mr I McDonald retire from office at this time and offer themselves for re-election. 

## **AFFORDABILITY** 

In February 2025, the Board set the rent increase at 5.5%. The cost of running AHA has increased again in 2025-26 with higher staffing, heating, and general running costs. Affordability and value for money remain a concern of the Board and future business planning will always take account of the balance required for both the needs of the tenants to ensure affordability and the needs of AHA to continue to run a sustainable business. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **STABILITY** 

The stability of the Association is paramount to the Board and all the Association’s stakeholders.  The Internal Audit Programme in 2025/26 covered Planned Maintenance, Business Planning, Development Management & Risk Appraisal and ARC Validation. CT Audit Limited carried out their third audit of the Association’s finances and financial practices and were given a positive report by the auditors. Financially, year-end figures show a surplus of £1,431,118 and an operating surplus of £3,583,053.  Housing stock value has risen by £3,094,971. 

One of the obligations for the Board is to set the future direction of the Association and to ensure that the structures within AHA can support the delivery of the Strategic Plan. 

2025/26 was a stable year for staffing with one new post created. In December 2025, the Association moved HR advice and support to RBS Mentor, ending a long-standing relationship with EVH.  The Employee Voice forum continued to provide a direct line of communication between employees and senior management and the use of OfficeVibe allows staff to provide constant feedback on key indicators such as recognition, happiness, stress and workload management. 

The Staff Away Day was well received and provided an opportunity to reflect on the findings of the 2025 Tenant Consultation Survey. Several Board Members attended and participated in sessions. Staff learnt how the Association ensures new developments and sites are financially viable, insight into the challenges tenants face and the work of the Financial Inclusion Team, understanding of governance, strengthen teamwork, and identify ways the Association could improve as a landlord. 

## **GOVERNANCE** 

In 2025/26 the Association recruited a Trainee Governance Officer to assist with governance and compliance across all aspects of the Associations work. Following attainment of governance qualifications, this post was promoted to Governance Officer, and the Board of Management now receive a report on governance at each Board meeting. 

The Association completed 4 Internal Audits covering Planned Maintenance, Business Planning, Development Management & Risk Appraisal and ARC Validation. The Assurance Level awarded was 2 High and 2 Substantial with the annual report from the internal auditors awarding High assurance overall. 

The Association were assessed as being Compliant by the SHR for 25/26 and following the submission of the Annual Assurance Statement in October 2025, have again been awarded Compliant for 26/27. 

## **DIGITAL** 

2025/26 saw the consolidation of improvements to our IT services which were initially put in place the previous year. There was a significant investment towards cyber security training and the association achieved Cyber Essentials plus accreditation in December 2025, achieving an important landmark on the Association’s digital journey.  A new tenant portal was launched summer 2025. The allows tenants to directly access information relating to their tenancy, to report repairs and to communicate with the Association in a different way. 

During the year the Association hosted a placement from Dundee University. The student allocated conducted a research project into the use of QR codes for facilitating access to new tenant information for new builds. A pilot project had been started with the first handovers of the Crudie Farm and St Vincents developments which used unique QR codes to allow tenants access to documents such as heating instructions, EPC’s and tenant safety certificates. Saving both staff resources and limiting paper products, this model will be rolled out to all new developments and the placement identified areas of cross over with the portal that provide an opportunity to raise our online offering to tenants. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

**For the year ended 31st March 2026** 

## **RISK MANAGEMENT** 

At the end of 2025/26 the Board has identified 20 risks with 10 strategic, 4 financial, 2 Health & Safety risks, 1 relating to business continuity, 1 operational risk, 1 reputational and 1 specific risk. Included in key risks under constant monitoring are failure to grow which includes the future of our development programme. The Risk Register reflects risks for AHA as a business along with ensuring that areas such as tenant safety and affordability align with risks identified by the SHR. To this end, the risk of failing to reflect new legislation, in particular relating to damp and mould have been considered and controls put in place. 

The Association has increased the collection of property data during the year and is now able to use this more effectively to manage budgets and plan projects. This includes whole house surveys for improvement works and ongoing surveys for asbestos and legionella. 

The impact of delays in planning consent for new build sites has added risk for the Association relating to treasury management and cashflow. At year end we had expected to be moving to be onsite with a significant development at Gowriehill. This delay has impacted the Association’s finances and internal resource allocation. 

The Association reduced the overall governance risk during 25/26 through the recruitment of 3 new Board members with a further 3 joining the Board at the April and June 2026 Board Meetings. This brought the number of Board members to 14 and added specialist knowledge in arrears such as IT, HR and Sustainability. 

The current five highest risks at year end are Failure to Grow, Failure in financial management along with Failure to deliver ESG objectives, Tenant Health and Safety and Pension Obligations. 

During 25/26, the Association concluded an insurance tender which resulted in some savings in premiums and additional cover in key areas. As a result, the insurance risk was reduced. The tender allowed the Association to ensure that adequate property re-instatement values have been reflected in premiums.  The pension obligations risk has remained high with confirmation in 25/26 that future budgets would need to take account of past deficit contributions due to the actuarial re-evaluation of our pension fund.  The ESG risk remains high simply due to the delay in having clarification from the Scottish Government on what the sector will be asked to deliver for net zero. Once this is known, a specific review along with related risks will be carried out. We expect this to have a significant impact on the direction taken to deliver our Asset Management Strategy and on how the Association allocates resources in the coming years. Whilst Failure to Grow remains a high risk at year end, this has now reduced following the results of the Scottish Elections and the commitment to multiyear budgeting and the AHSP (Affordable Housing Supply Programme) and the Association welcomes the Scottish Government’s commitment to the £4.1billion of public investment over four years. During the year we increased the risk for failure in financial management. This was solely due to the pressure on the 26/27 budget and the need to carefully manage cashflow rather than any underlying concerns about the overall viability of the Association.  Raising the risk increased the visibility for staff and Board of the need for detailed scrutiny and management of the budget to ensure that financial projections in relation to covenants, cashflow and surpluses were met. 

The risk register reflects the significant external pressures that the Association faces. It takes account of the Scottish Housing Regulators’ Business Planning Advisory Note and the Summary Outcomes of the Scottish Housing Regulators’ Risk Assessments of Social Landlords. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **PERFORMANCE MANAGEMENT AND SERVICE DELIVERY** 

The Association is committed to providing tenants with good service and value for money. To support this, we work to meet the outcomes set out in the Scottish Housing Regulator’s Regulatory Framework and the Scottish Social Housing Charter. Performance across key indicators remains strong. The Association’s threeyearly Tenant Satisfaction Survey was completed in late 2025 through face-to-face interviews and achieved a 40.5% response rate. Overall satisfaction remains high, increasing to 89.3% from 86.83% in 2022. In addition to higher satisfaction rates across all key indicators, dissatisfaction levels reduced. 

**Debt Recovery:** Although inflation has eased, tenants are still feeling the lasting effects of the cost-of-living crisis, which continues to affect rent payments. There are two key arrears measures: the ARC indicator, which includes arrears written off, and the current tenant arrears figure at year end. At year end, current arrears stood at 1.39%, compared with (1.44% in 2024/25), against a target of 2%. This remains low despite the economic climate, and our benchmarking compares very favourably with peer landlords, with performance stronger than several of them, reflecting the significant effort and commitment of staff. 

## **BEST USE OF RESOURCES** 

Future financial planning is key to the Association’s ability to provide ongoing services to our tenants and to maintain and future proof our stock. 

The Association is committed to providing value for money both in terms of external funding and grants and the use of rental income. To that end, we have produced a comprehensive Annual Procurement Report for 2025/26 which will be submitted to the Scottish Government. The report shows continued commitment towards the Association’s Procurement Strategy. 

To ensure value for money in our reactive repairs service, our contractor framework was re-tendered. All the tenders above were conducted using PCS (Public Contracts Scotland). 

During 25/26 we carried out several workshops with Board members, staff and tenants to look at the use of Community Benefits. The workshops used Service Design Principles with the aim of using Community Benefit resources efficiently and fairly. This has resulted in a Community Benefit Strategy, and we have also been able to provide more community benefits directly between our tenants and contracts during the year. Work commenced on a website to utilise a tech solution for the management of Community Benefits, giving contractors more visibility on their contract contributions and notifying them of opportunities to discharge these. The website will hold contractors accountable for their CB contributions which will aid the Association, our tenants and groups within the local community, with delivery of the website due in 26/27. 

## **WIDER ROLE** 

The Association remains firmly committed to tenant participation and community engagement. 

The Association’s tenancy sustainment rate remains strong at 93.6% for both waiting list and homeless applicants. Effective tenancy sustainment helps tenants keep up with rent, reduces evictions and abandonments, and lowers the number of void properties and the associated rent loss. 

In 2025/26, the Financial Inclusion Team (FIT) secured around £357,602 in additional income and benefits for AHA tenants, while also supporting those experiencing arrears and wider money management issues. The team handled 608 cases, supported 1,681 tenants, and accessed around £2,664 from the Hardship Fund to help sustain tenancies. Our Energy Advisor assisted tenants with meter and billing issues, provided advice to those affected by RTS (radio tele switch) meters, and secured funding for Solar PV installations through the Help4Homes scheme, which is funded mainly by British Gas. Demand for the service remained strong, with 145 referrals during the year. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **INVESTMENT** 

**Development:** 2025/26 added a further fifty-four units to the Association’s stock making a total figure of 2,206. These were delivered in Dundee, Arbroath and Edzell in partnership with Campion Homes, Scotia Homes and Guild Homes. One scheme in development by George Martin was delayed by a fire that destroyed 6 units which are being re-build however the handover for the additional 12 units has been delayed. 

**Capital Works Programmes:** The Association has continued to deliver a considerable improvement programme in place during 2025/26 including kitchen, boiler, window and door replacement and painter work. This relates to improvements in around 9%of our stock.  At the year end, the cost of the works completed is £3,387,181 

**Reactive Repairs:** Our performance on reactive repairs remains high. Our ARC submission for 2025/26 showed an improvement from 2.07 to1.79 hours average to undertake emergency repairs. For nonemergency repairs, the average was 4.24 days which is the same average as the previous year. The percentage or repairs carried out within targets is 95% for non-emergency (95% in 24/25) and 994 for emergency (up from 94% in 24/25. Repairs carried out right first time remains high at 94%. A pre submission audit of the ARC by the SHN (Scottish Housing Network) found no issues with the submission. We have started a process with the SHN (Scottish Housing Network) to carry out a desktop exercise each year to show benchmarking with a presentation on our performance delivered by them to our staff and Board each year.  Our average voids cost was higher than budget per void, in part due to an increased number of properties being returned to us in very poor condition. 

We have continued to perform well in relation to gas servicing (100%). We reported 55 EICR failures relating to issues such as starting improvement programmes shortly after the anniversary, no power in property, no access given by tenants, and some issues with properties where the tenant has hoarding issues. At the time of submission of the ARC, this number had been reduced to 7. 

## **EQUALITY & DIVERSITY** 

In 2025/26 we did extend the information on equalities available on our website which included equalities data. Child and adult protection policies were reviewed, and all staff completed some level of Mental Health training which ranged from mental health awareness to Mental Health first aid accreditation. 

## **SUSTAINABILITY** 

Whilst the continued delays in the publishing of the Social Housing Net Zero Heat Strategy have once again not allowed us to put in place a specific programme of works, we have delivered Solar PVs in new build units and have added Solar PVs to 24 units within our stock. We produced our second annual report on the Social Housing Sustainable Reporting Standard. As an adopter of the standard, we will be able to monitor improvements in data and reporting and show our stakeholders that the Association has made and is progressing a commitment to reducing climate change. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **TENANT AND STAKEHOLDER ENGAGEMENT** 

Good progress has been made against our Tenant and Stakeholder objectives for 2025/26. Our partnership with Arbroath Connections remains strong, with the organisation continuing to lease significant space at Russell Square providing support for people affected by dementia. We have also continued to deliver community events with partners, including Bingo Blether, furniture upcycling, family fun days, green growing projects, Mental Health First Aid accreditation, a swap shop, and IT classes with AbilityNet. These activities are supported by both the Association and external organisations. Through estate management walkabouts with tenants over £20,000 was spent on community improvements, including tree removals, block upgrades and fencing. In addition, we secured £70,000 to regenerate a community play park in Whitfield. 

We have worked closely with tenants to strengthen their involvement in the Association’s decision-making and have established a monthly Tenant Voice group. In partnership with MPS, we have also introduced a programme of additional support, which has so far helped around 20 tenants with garden clearances, fencing, and minor community improvements. 

## **FUTURE PLANS** 

## **Next 12 Months** 

In June 2026, the Board of Management approved the 3-year Strategic Plan which covers 2026-29. This will be launched at the AGM in August 2026. The main themes with the plan relate to: 

- Affordable Homes and Growth 

- Financial Resilience and Value for Money 

- Governance, Risk & Compliance 

- Customers, Communities and Tenant Safety 

- Assets, Repairs and Net Zero 

- People, Skills and Culture 

- Digital, Date and AI 

- Place, Partnership and New Ways of Working 

The Association plans to complete 18 new build units in 2025/26. We also plan to have 115 new build units on site at Whitefield Phase 2 developed by George Martin,  Gowriehill, developed by Campion Homes and Rockwell School developed by Sidlaw Joinery. For Gowriehill this is dependent on planning approval which is still outstanding after 2 years and for Rockwell, the spend needs approval to be added to the Dundee SHIP (Strategic Housing Investment Plan). Planning delays have contributed to additional costs requiring increased HAG allowance and this also needs approved by the Scottish Government.  Phase 2 of Whitfield Drive is well underway. The Association has a development plan and funding to deliver it until 2030/31 with sites in Froickhiem, Arbroath and phases 3 and 4 of Whitfield delivering an additional 42 units. 

A budget of £2.7m will complete capital works programmes for kitchens, bathrooms, cyclical painter work and window replacements. 

In 25/26 the Association recruited its first direct labour Maintenance Operative. Work is underway to assess the customer and financial impact of providing this service to ensure that value for money has been delivered. If the business case is positive, the Board of Management are keen for the Association to add additional resources to this service with a view to increasing savings in day-to-day reactive maintenance. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

The Association is preparing for the damp and mould provisions of the Investigation and Commencement of Repair (Scotland) Regulations 2026 (Scotland’s version of Awabs Law) which will be implemented from October. The performance and costs of this will be closely monitored along with tenant feedback and complaints. Staff have been designing new systems to manage the new processes and timescales along with ensuring the Home Master software supports the management and reporting of damp and mould cases. 

The Compliant Engagement status from the SHR for 26/27 requires us to provide more information on our development programmes, lending and cashflow projections for the year and we will work with the SHR to provide regular updates on these areas of the Association’s risk. 

In June 2026, the Association purchased a new office building at Ethiebeaton in Angus. During the 2026/27 financial year, we will be progressing the work to alter this building so that it can be the HQ for the Association and accommodate 60 staff, meeting facilities and flexibility for the Association to accommodate future growth withing the building. 

The Association will be reviewing the Treasury Management Policy and implementing a Finance Strategy during 2026/27 to ensure that the Association is investing resources appropriately. As part of this work, external consultants will be working the key staff to consider the longer-term financial needs of the Association with consideration of growth, new build ambitions, net zero considerations and ongoing affordability and business planning requirements. 

As noted above, an external consultant provided a report to the Board indicating that developing Musselcrag to deliver MMR was an option however the business case needed to be developed. Work will be undertaken during 2026/27 to detail the costs and risks to the Association with a view to progressing this within the medium to longer term is the business case can be proven. 

The Association is progressing the ability to use the data it holds to inform data driven decision making with more use of Power BI and within the year, the RBS Buildings Energy Assessment Tool (BEAT) which will allow modelling for net zero projects, inform future business planning and allow more detailed and accurate reporting on savings in carbon emissions. 

To continue to improve our services to tenants, the Association will be assessed for the Customer Services Excellence Standards Accreditation in September 2026, and we will work with the assessors over the next 3 years to steadily improve our customer service across all areas of our work. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **Medium Term (next 3 years)** 

Within the next 3 years the Association will deliver the objectives detailed in the Strategic Plan noted above. The plan notes that a number of external factors will contribute to the success of this delivery and that due to several key areas of uncertainty including financial markets, ongoing funding opportunities and net zero obligations, the plan is written to allow flexibility in the areas that the Association can focus on. 

Depending on the outcome of the Business Case analysis on the viability of Musselcrag as a vehicle to deliver MMR, this may be progressed as a medium to longer term project. 

We have an inherent commitment to our current tenants and will work to deliver improvements to their homes. The priorities for this are dependent on the requirements from the Scottish Government in relation to the Social Housing Net Zero Heat Standard and we look forward to seeing the final guidance on this. 

The Association will be looking to deliver our Asset Management Strategy, building in the flexibility to adapt our approach to capital programmes to take account of legislation, regulation and funding. We are keen to incorporate new technologies relating to construction types and methods and in the provision of net zero heat systems however we will take a cautious approach to this to ensure that we provide value for money. This will include strengthen our environmental data recording and reporting using the BEAT tool. 

Better data and reporting abilities within the Association will ensure that our business planning is reflecting where resources need to be allocated in order to ensure that we are meeting our legal, regulatory, landlord and employer obligations and over the medium term, we will continue to develop this capacity. 

## **Long Term** 

The Association intends to remain an independent RSL with a development programme, providing steady growth opportunities. We intend to maintain and improve where possible, services and performance to our tenants. This will include encouraging tenants to become more involved in the decision-making processes within the Association through membership, with more tenants on the Board of Management. 

## **Statement of Board of Management’s Responsibilities** 

The Co-operative and Community Benefit Societies Act 2014 requires the Board of Management to prepare Financial Statements for each financial year which give a true and fair view of the Association and of the surplus or deficit of the Association for that period.  In preparing those Financial Statements, the Board of Management is required to: 

- select suitable accounting policies and then apply them consistently; 

- make judgements and accounting 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; 

- Prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Association will continue in business; and prepare a statement on Internal Financial Control. 

The Board of Management is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Association and to enable it to ensure that the Financial Statements comply with the Co-operative and Community Benefit Societies Act 2014, the Housing (Scotland) Act 2010 and the Determination of Accounting Requirements 2024.  It is also responsible for safeguarding the assets of the Association and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.  It is also responsible for ensuring the Association’s suppliers are paid promptly. 

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## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

The Board of Management must, in determining how amounts are presented within items in the Statement of Comprehensive Income and the Statement of Financial Position, have regard to the substance of the reported transaction or arrangement, in accordance with generally accepted accounting practices. 

In so far as the Members of the Board of Management are aware: 

- there is no relevant audit information (information needed by the Housing Association’s auditors in connection with preparing their report) of which the Association’s auditors are unaware, and 

- the Members of the Board of Management have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the Housing Association’s auditors are aware of that information. 

## **INTERNAL FINANCIAL CONTROL** 

The Board of Management acknowledges its ultimate responsibility for ensuring that the Association has in place a system of controls that is appropriate for the business environment in which it operates. These controls are designed to give reasonable assurance with respect to: 

- the reliability of financial information used within the Association, or for publication. 

- the maintenance of proper accounting records. 

- the safeguarding of assets against unauthorised use or disposition. 

It is the Board of Management’s responsibility to establish and maintain the systems of internal financial control. Such systems can only provide reasonable and not absolute assurance against material financial misstatement or loss. Key elements of the Association’s systems include ensuring that: 

- formal policies and procedures are in place, including the on-going documentation of key system and rules in relation to the delegation of authority, which allow the monitoring of controls and restrict the unauthorised use of the Association’s assets. 

- experienced and suitably qualified staff take responsibility for important business functions and annual appraisal procedures have been established to maintain standards of performance. 

- forecasts and budgets are prepared, which allow the management team and the Board of Management to monitor the key business risks, financial objectives and progress being made towards achieving the financial plans set for the year and for the medium term. 

- quarterly financial management reports are prepared promptly, providing relevant, reliable, and up to date financial and other information, with significant variances from budget being investigated as appropriate. 

- Regulatory returns are prepared, authorised, and submitted promptly to the relevant regulatory bodies. 

- all significant new initiatives, major commitments and investment projects are subject to formal authorisation procedures, through the Board of Management 

- the Finance, Audit and Risk sub-committees received reports from management and from external and internal auditors, to provide reasonable assurance that control procedures are in place and are being followed and that a general review of the major risks facing the Association is undertaken. 

- Formal procedures have been established for instituting appropriate action to correct any weaknesses identified through internal or external audit reports. 

The Board of Management have reviewed the effectiveness of the system of internal financial control in existence in the Association for the year ended 31 March 2026. No weaknesses were found in internal financial controls which resulted in material losses, contingencies or uncertainties which require disclosure in the financial statements or in the auditor’s report on the financial statements. 

Page 12 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **REPORT OF THE BOARD OF MANAGEMENT** (continued) 

## **For the year ended 31st March 2026** 

## **ELECTION OF AUDITORS** 

A resolution to appoint CT Audit Limited as auditors will be submitted at the Annual General Meeting. 

## **By Order of the Board** 


## **Secretary to the Board of Management** 

## **19th August 2026** 

Page 13 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **Independent Auditor’s Report to the Members of Angus Housing Association Limited** 

## **For the year ended 31st March 2026** 


## **Opinion** 

We have audited the financial statements of Angus Housing Association Limited (the ‘association’) for the year ended 31 March 2026 which comprise of Statement of Comprehensive Income, Statement of Financial Position, the Statement of Cash Flows, Statement of Changes in Reserves, 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 applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). 

In our opinion the financial statements: 

- give a true and fair view of the state of the association’s affairs as at 31 March 2026 and of 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 Co-operative and Community Benefit Societies Act 2014, the Housing (Scotland) Act 2010 and the Scottish Housing Regulator’s Determination of Accounting Requirements 2024. 

## **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 association 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 Board’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 association's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. 

Our responsibilities and the responsibilities of the Board with respect to going concern are described in the relevant sections of this report. 

Page 14 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **Independent Auditor’s Report to the Members of Angus Housing Association Limited (continued)** 

## **For the year ended 31st March 2026** 

## **Other information** 


The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The Board are responsible for the other information contained within the annual report. 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. 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 course of the audit, or otherwise appears to be materially misstated. 

If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. 

We have nothing to report in this regard. 

## **Matters on which we are required to report by exception.** 

We have nothing to report in respect of the following matters where the Co-operative and Community Benefit Societies Act 2014 requires us to report to you if, in our opinion: 

- proper books of account have not been kept by the association in accordance with the requirements of the legislation; or 

- a satisfactory system of control over transactions has not been maintained by the association in accordance with the requirements of the legislation; or 

- the Statement of Comprehensive Income and Statement of Financial Position are not in agreement with the books of account of the Association; or 

- we have not received all the information and explanations we need for our audit. 

## **Responsibilities of the Board** 

As explained more fully in the Board’s responsibilities statement (set out on pages 11 and 12), the Board 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 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 Board 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 either intends to liquidate the association or to cease operations, or have no realistic alternative but to do so. 

Page 15 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **Independent Auditor’s Report to the Members of Angus Housing Association Limited (continued)** 

## **For the year ended 31st March 2026** 

## **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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud is detailed below: 

## **The extent to which the audit was considered capable of detecting irregularities including fraud.** 

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: 

We gained an understanding of the legal and regulatory framework applicable to the Association and the industry in which it operates and considered the risk of acts by the Association which were contrary to applicable laws and regulations, including fraud. These included but were not limited to the Housing SORP 2018, the Co-operative and Community Benefit Societies Act 2014 and the Housing (Scotland) Act 2010. 

We focused on laws and regulations that could give rise to a material misstatement in the Association’s financial statements. Our tests included, but were not limited to: 

- agreement of the financial statement disclosures to underlying supporting documentation. 

- enquiries of the members; 

- review of minutes of board meetings throughout the period; 

- review of legal correspondence or invoices, and 

- obtaining an understanding of the control environment in monitoring compliance with laws and regulations. 

There are inherent limitations in an audit of financial statements 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 would become aware of it. We also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud. 

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. 

Page 16 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **Independent Auditor’s Report to the Members of Angus Housing Association Limited (continued)** 

## **For the year ended 31st March 2026** 


## **Use of our report** 

This report is made solely to the Association’s members, as a body, in accordance with the Co-operative and Community Benefit Societies Act 2014. Our audit work has been undertaken so that we might state to the Association’s members 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 Association and the Association’s members as a body for our audit work, for this report, or for the opinions we have formed. 


**CT Audit Limited Chartered Accountants and Statutory Auditor 61 Dublin Street Edinburgh EH3 6NL** 

28 August 2026 

Page 17 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **Report of the Auditors To Angus Housing Association Limited on Corporate Governance Matters** 

## **For the year ended 31st March 2026** 


In addition to our audit of the financial statements, we have reviewed your statement on page 12 concerning the Association’s compliance with the information required by the Regulatory Standards for in respect of internal financial controls contained within the publication “Our Regulatory Framework” and associated Regulatory Advisory Notes issued by the Scottish Housing Regulator. 

## **Basis of opinion** 

We carried out our review having regard to the requirements to corporate governance matters within Bulletin 2006/5 issued by the Financial Reporting Council.  The Bulletin does not require us to review the effectiveness of the Association’s procedures for ensuring compliance with the guidance notes, nor to investigate the appropriateness of the reason given for non-compliance. 

## **Opinion** 

In our opinion the Statement on Internal Financial Control on page 12 has provided the disclosures required by the relevant Regulatory Standards for systemically important RSLs within the publication “Our Regulatory Framework” and associated Regulatory Advisory Notes which are issued by the Scottish Housing Regulator in respect of internal financial controls and is consistent with the information which came to our attention as a result of our audit work on the Financial Statements. 

Through enquiry of certain members of the Board of Management and Officers of the Association and examination of relevant documents, we have satisfied ourselves that the Board of Management’s Statement on Internal Financial Control appropriately reflects the Association’s compliance with the information required by the relevant Regulatory Standards for systemically important RSLs in respect of internal financial controls within the publication “Our Regulatory Framework” and associated Regulatory Advisory Notes issued by the Scottish Housing Regulator in respect of internal financial controls. 


**CT Audit Limited Chartered Accountants & Statutory Auditor 61 Dublin Street Edinburgh EH3 6NL** 

28 August 2026 

Page 18 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **HOUSING ASSOCIATION STATEMENT OF COMPREHENSIVE INCOME For the year ended to 31[st] March 2026** 

|Notes<br>Turnover<br>2<br>Operating costs<br>2<br>**OPERATING SURPLUS**<br>Interest receivable and other income<br>Interest payable and similar charges<br>6<br>Pension interest<br>19<br>**SURPLUS FOR YEAR**<br>Actuarial gain in respect of pension schemes<br>Total comprehensive income for the year|**2026**<br>**£**<br>16,115,121<br>(12,532,068)<br>3,583,053<br>226,299<br>(2,325,234)<br>(53,000)<br>1,431,118<br>232,000<br>1,663,118|**2025**<br>**£**<br>13,031,806<br>(9,523,196)|
|---|---|---|
|||3,508,610<br>120,859<br>(1,931,216)<br>(49,000)|
|||1,649,252|
|||165,000|
|||1,814,252|



The financial statements were approved by the Board of Management on 19[th] August 2026 and were signed on its behalf by: 




Member of Board of Management Secretary to Board of Management Member of Board of Management 

All figures relate to continuing operations. 

The notes on pages 23 to 41 form part of these financial statements. 

Page 19 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **HOUSING ASSOCIATION STATEMENT OF FINANCIAL POSITION As at 31[st] March 2026** 

|Notes<br>**FIXED ASSETS**<br>Housing properties<br>9a<br>Fixed Asset Investment<br>9b<br>Other Fixed Assets<br>9c<br>**CURRENT ASSETS**<br>Trade and other debtors<br>10<br>Cash & cash equivalents<br>Stock<br>11<br>**CURRENT LIABILITIES**<br>**CREDITORS**: amounts falling due within one year<br>12<br>**NET CURRENT ASSETS**<br>**TOTAL ASSETS LESS CURRENT LIABILITIES**<br>**CREDITORS**: amounts falling due after more than one year<br>13<br>Defined benefit pension liability<br>19<br>**NET ASSETS**<br>**CAPITAL AND RESERVES**<br>Share Capital<br>14<br>Revenue reserve<br>15|**2026**<br>**£**<br>150,274,884<br>1<br>654,252<br>150,929,137<br>906,644<br>15,600,864<br>1,602<br>16,509,110<br>(4,221,623)<br>12,287,487<br>163,216,624<br>(137,626,561)<br>(722,479)<br>24,867,584<br>44<br>24,867,540<br>24,867,584|**2025**<br>**£**<br>147,179,913<br>1<br>617,366|
|---|---|---|
|||147,797,280|
|||745,150<br>6,731,762<br>-|
|||7,476,912<br>(4,506,904)|
|||2,970,008|
|||150,767,288<br>(126,661,346)<br>(901,479)|
|||23,204,463|
|||41<br>23,204,422|
|||23,204,463|



The financial statements were approved by the Board of Management on 19[th] August 2026 and were signed on its behalf by: 




Member of Board of Management Secretary to Board of Management Member of Board of Management 

The notes on pages 23 to 41 form part of these financial statements. 

Page 20 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **STATEMENT OF CHANGES IN RESERVES FOR YEAR ENDED 31 MARCH 2026** 

|**As at 31 March 2025**<br>Total Comprehensive income for the year<br>Re-measurement loss on defined benefit<br>**Total Comprehensive Income**<br>Issued in the year<br>Cancelled in the year<br>**As at 31 March 2026**|**Share**<br>**Capital**<br>**£**<br>**41**<br>-<br>-<br>**41**<br>3<br>-<br>**44**|**Revenue**<br>**Reserve**<br>**£**<br>**23,204,422**<br>1,431,118<br>232,000<br>**24,867,540**<br>-<br>-<br>**24,867,540**|**Total**<br>**£**<br>**23,204,463**<br>1,431,118<br>232,000<br>**24,867,581**<br>3<br>-<br>**24,867,584**|
|---|---|---|---|



The notes on pages 23 to 41 form part of these financial statements. 

Page 21 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **STATEMENT OF CASH FLOW For the year ended 31[st] March 2026** 

|Notes<br>**NET CASH INFLOW FROM OPERATING**<br>16<br>**ACTIVITIES**<br>**CASHFLOW USED IN INVESTING ACTIVITES**<br>Purchase of tangible fixed assets<br>Grants received<br>Interest receivable<br>**NET CASH FLOW USED IN INVESTING ACTIVITIES**<br>**CASHFLOW USED IN FINANCING ACTIVITIES**<br>Issue of share capital<br>Interest paid<br>New Secured Loans<br>Repayment of borrowings<br>**NET CASH FLOW FROM FINANCING ACTIVITES**<br>**NET INCREASE IN CASH AND CASH EQUIVALENTS**<br>**CASH AND CASH EQUIVALENTS AS AT 1ST April 2025**<br>**CASH AND CASH EQUIVALENTS AS AT 31ST March**<br>**2026**|**2026**<br>**£**<br>4,980,348<br>(6,831,747)<br>2,656,543<br>226,299<br>(3,948,905)<br>3<br>(2,378,234)<br>10,514,476<br>(298,585)<br>7,837,660<br>8,869,103<br>6,731,762<br>15,600,864|**2025**<br>**£**<br>6,809,289|
|---|---|---|
|||(15,100,495)<br>6,466,130<br>120,859|
|||(8,513,507)<br>10<br>(1,980,216)<br>6,000,000<br>(1,481,640)|
|||2,538,154<br>833,937|
|||5,897,825|
|||6,731,762|



The notes on pages 23 to 41 form part of these financial statements. 

Page 22 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **1. ACCOUNTING POLICIES** 

## **Accounting basis** 

These financial statements have been prepared under the historical cost convention and in accordance with the Financial Reporting Standards 102 (FRS102) and the Statement of Recommended Practice for Social Housing Providers 2018 (SORP 2018) and the Scottish Housing Regulator Determination of Accounting Requirements 2024. 

The financial statements have been prepared on a going concern basis. 

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years unless otherwise stated. 

The financial statements are presented in sterling which is the functional currency of the Association. 

## **Turnover** 

Turnover represents the rental and service charge income receivable in the year net of losses from voids, revenue, and other grants. 

The disposal from the first tranche of shared ownership properties is included in turnover at the point of legal completion. The second and subsequent tranches are accounted for in other income in the period which the disposal occurs. 

## **Sale of housing properties** 

The surplus or deficit is accounted for in the period the disposal occurs and represents the difference between the net sale proceeds and the net carrying value. The surplus/deficit amount arising from the sale of housing properties is disclosed separately in the Statement of Comprehensive Income. 

## **Shared Ownership sales** 

In accordance with the SORP 2018, shared ownership properties are reflected within Fixed Assets. Proceeds from first tranche disposals are allocated to Turnover. Costs relating to expected first tranche sales are reflected in current assets and released to the Statement of Comprehensive Income on sale. 

The surplus or deficit on the disposal of second subsequent tranches of shared ownership properties are accounted for in the Statement of Comprehensive income within the Gain/ Loss on sale of Tangible Fixed Assets. 

Page 23 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS** 

## **For the year ended 31[st] March 2026** 

## **ACCOUNTING POLICIES** (continued) 

## **Interest Income** 

Interest income is recognised in the statement of comprehensive income using the effective interest method. 

## **Fixed assets – housing land and buildings** 

Housing properties are stated at cost. The development costs of housing properties include the following: 

- i. Cost of acquiring land and buildings. 

- ii. Development expenditure. 

- iii. Capital acquisition and development administration costs. 

- iv. Capital clerk of works costs 

Expenditure on schemes which are subsequently aborted is written off in the year in which it is recognised that the schemes will not be developed to completion. 

The proceeds arising from first tranche “sales” of Housing Association Grant funded shared ownership properties are recorded through the Income & Expenditure Account, with any subsequent sales treated as a disposal of fixed assets. 

In accordance with the SORP, where a housing property comprises two or more major components with substantially different useful economic lives, each component has been accounted for separately and depreciated over its useful life. The following components have been identified: 

|Component<br>Land<br>Main Structure<br>Roof<br>Windows & Doors<br>Guttering / Woodwork<br>External Fencing<br>Heating System - Gas<br>Heating System - Electric<br>Heating System - Radiators<br>Kitchen<br>Bathroom<br>Electrical Installation<br>Controlled Entry Systems<br>Storage Battery<br>Solar PVs<br>Air Source Heat Pumps|Useful Economic Life|
|---|---|
||Not Applicable<br>90 Years<br>50 Years<br>30 Years<br>25 Years<br>25 Years<br>15 Years<br>15 Years<br>25 Years<br>15 Years<br>15 Years<br>10 Years<br>12 Years<br>20 Years<br>20 Years<br>20 Years|



The Association will capitalise the replacement of these components in line with its Lifecycle Replacement Programme. One off main component replacement will not be capitalised unless the replacement is within a timeframe which means that the component will not be replaced again at the next scheduled cycle. 

Page 24 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS** 

## **For the year ended 31[st] March 2026** 

## **ACCOUNTING POLICIES** (continued) 

## **Fixed assets – impairment** 

Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each balance sheet date. The level at which an impairment is assessed is at the scheme of properties (e.g. the cash generating unit (CGU)). 

The following key judgement has been made in defining the CGUs for housing properties (including shared ownership properties):  where schemes have been developed together and are managed together, they are deemed to be a single CGU. 

The key indicators considered in reviewing impairment are changes in demand, changes in use, economic performance worse than expected, significant decline in market value, reduction in market value where intend to sell, plans to regenerate, demolish or replace existing components, on completion of new developments where costs are higher than anticipated, and other changes in technology, market, economy and legislation. 

If such indication exists, the recoverable amount is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in expenditure through the Statement of Comprehensive Income. 

## **Fixed assets – other fixed assets** 

Items costing more than £2,000 are capitalised. Depreciation is provided for at rates calculated to write off the cost of each asset evenly over its expected useful life as shown above except for the following: 

Housing Properties (shared ownership) over 50 years Office Building over 50 years Computer and Office Equipment over 4 years Office and Furnished Flat Furnishings over 4 years over 4 years 

## **Development Interest** 

Interest on borrowings specifically financing a development is capitalised to the extent that it accrues in respect of the period during which development activities are in progress. All other interest is written off to the Statement of Comprehensive Income in the period in which it accrues. 

## **Capitalisation of overheads** 

Costs which directly relate to bringing assets into working conditions are included within the cost of the asset and any subsequent component replacements. These primarily relate to salary costs. 

Page 25 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS** 

## **For the year ended 31[st] March 2026** 

## **ACCOUNTING POLICIES** (continued) 

## **Subsidiary** 

The subsidiary Musselcrag Limited is a dormant company as at 31[st] March 2026 and accordingly the Association has not prepared consolidated financial statements. 

## **Debtors and Creditors** 

Debtors and creditors within a year and stated with no interest receivable or payable and are recorded at transaction price. 

## **Stock** 

Stock is valued at the lower of cost and estimated selling price less cost to complete and sell using a weighted average method. 

## **Grants** 

Where a grant is paid as a contribution towards revenue expenditure, it is included in turnover. Where a grant is received from government and other bodies as a contribution towards a capital cost, it is recognised as income using the performance model in accordance with the SORP 2018. Prior to satisfying the performance conditions such grants are held as deferred income on the Statement of Financial Position. 

## **Social Housing Grant and other capital grants** 

Social Housing Grants and other capital grants are accounted for using the Accrual Method as outlined in Section 24 of Financial Reporting Standard 102. Grants are treated as deferred income and recognised in income on a systematic basis over the expected useful life of the property and assets to which they relate. 

Social Housing Grant attributed to individual components is written off to the Statement of Comprehensive Income when these components are replaced. 

Although Social Housing Grant is treated as a grant for accounting purposes, it may nevertheless become repayable in certain circumstances, such as the disposal of certain assets. The amount repayable would be restricted to the net proceeds of sale. 

Page 26 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS** 

## **For the year ended 31[st] March 2026** 

## **ACCOUNTING POLICIES** (continued) 

## **Lead Tenancy Provision** 

Lead Tenancy agreements require that a proportion of the rental income be retained by the Association to provide for future major repairs. Any sums remaining at the expiry of the Lead Tenancy Arrangement will be repaid to the owner of the property. 

## **Significant Estimates** 

The preparation of financial statements requires the use of certain accounting judgements and estimates. It also requires the Board of Management exercise judgement in applying the Association’s accounting policies. The areas requiring the use of significant estimates are disclosed below. 

## **(i) Rent Arrears – Bad Debt Provision** 

The Association assumes the recoverability of rent arrears through a detailed process that considers tenant payment history and recovery arrangements in place. 

## **(ii) Useful Life of Properties, Plant and Equipment** 

The Association estimates the useful life of properties, plant, and equipment, as well as components thereof, and estimates an annual charge to be depreciated. 

## **(iii) Defined Benefit Pension Liability** 

In determining the value of the Association’s share of defined benefit pension scheme assets and liabilities, the valuation prepared by the Scheme actuary includes estimates of life expectancy, salary growth, inflation, and the discount rate on corporate bonds. 

## **Cash and Cash Equivalents** 

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty of not more than 24 hours. 

## **Deposits** 

Funds held in short term deposit accounts for a term over 3 months are presented at their current value with any interest received being charged to the statement of comprehensive income. 

## **Operating Leases** 

Rental applicable to operating leases, where substantially all of the benefits and risks of ownership remain with the lessor are charged to the Income and Expenditure Account on a straight-line basis over the term of the lease. 

## **Pensions** 

The Association participates in the Scottish Housing Association’s Pension Scheme (SHAPS) providing benefits based on Career Average Revalued Earnings. The Association’s share of the Scheme Assets and Liabilities is shown in the Statement of Financial Position in accordance with their requirements of FRS17. 

Page 27 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **2 PARTICULARS OF TURNOVER, OPERATING COSTS AND OPERATING SURPLUS** 

|Income & Expenditure from<br>Lettings (note 3)<br>Other Activities (note 4)<br>TOTAL 2026<br>Total for 2025|Turnover<br>**£**<br>15,620,835<br>494,286<br>16,115,121<br>13,031,806|Operating<br>Costs<br>**£**<br>12,044,509<br>487,559<br>12,532,068<br>9,523,196|2026<br>Operating<br>Surplus/(Deficit)<br>**£**<br>3,576,326<br>6,727<br>3,583,053|2025<br>Operating<br>Surplus/(Deficit)<br>**£**<br>3,349,096<br>159,514|
|---|---|---|---|---|
|||||3,508,610|
||||||



## **3 PARTICULARS OF TURNOVER, OPERATING COSTS AND OPERATING SURPLUS OR DEFICIT FROM SOCIAL LETTING ACTIVITIES** 

|Rent Receivable net of Service Charges<br>Service Charges<br>Gross Income from Rent and Service<br>Charges<br>Less: Voids<br>Net Income from Rents & Service Charges<br>Grants released from deferred Income<br>Revenue Grants<br>Sale of Shared Equity Property (note 5)<br>Total Turnover from Social Letting Activities<br>Management and maintenance<br>administration costs<br>Services costs<br>Planned and Cyclical Maintenance including<br>major repairs costs<br>Reactive Maintenance costs<br>Rent Losses from Bad Debts<br>Depreciation of affordable let properties<br>Sale of Shared Equity Properties<br>Operating costs for affordable letting<br>activities<br>Operating Surplus for affordable letting<br>activities 2026<br>Operating Surplus for affordable letting<br>activities 2025|General<br>Needs<br>Housing<br>**£**<br>12,468,626<br>103,234<br>12,571,860<br>(65,623)<br>12,506,237<br>1,066,230<br>-<br>2,039,452<br>15,611.919<br>3,618,361<br>82,425<br>959,131<br>1,561,108<br>119,843<br>3,663,444<br>2,039,453<br>12,043,765<br>3,568,154<br>3,339,602|Shared<br>Ownership<br>**£**<br>8,916<br>-<br>8,916<br>-<br>8,916<br>-<br>-<br>-<br>8,916<br>745<br>-<br>-<br>-<br>-<br>-<br>-<br>745<br>8,172<br>9,494|2026<br>Total<br>**£**<br>12,477,542<br>103,234<br>12,580,776<br>(65,623)<br>12,515,153<br>1,066,230<br>-<br>2,039,452<br>15,620,835<br>3,619,105<br>82,425<br>959,131<br>1,561,108<br>119,843<br>3,663,444<br>2,039,453<br>12,044,509<br>3,576,326|2025<br>Total<br>**£**<br>11,557,858<br>100,996|
|---|---|---|---|---|
|||||11,658,855<br>(39,170)|
|||||11,619,685<br>995,162<br>-<br>-|
|||||12,614,846<br>3,296,249<br>88,080<br>1,179,146<br>1,258,302<br>52,028<br>3,391,945<br>-|
|||||9,265,750|
|||||3,349,096|
||||||



Note: There was no impairment of social housing. 

Page 28 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **3 PARTICULARS OF TURNOVER, OPERATING COSTS AND OPERATING SURPLUS FROM SOCIAL LETTING ACTIVITIES (continued)** 

The number of units of housing under development and in management at 31st March 2026 was: 

|Housing accommodation for letting<br>New build – Rented<br>Rehabilitation – Rented|**Units under**<br>**Development**<br>**2026**<br>**2025**<br>18<br>66<br>-<br>-<br>18<br>66|**Units in Management**<br>**2026**<br>**2025**<br>1,702<br>1,640<br>504<br>504<br>2,206<br>2,144|**Units in Management**<br>**2026**<br>**2025**<br>1,702<br>1,640<br>504<br>504<br>2,206<br>2,144|
|---|---|---|---|
||||2,144|



## **4 PARTICULARS OF TURNOVER, OPERATING COSTS AND OPERATING SURPLUS OR (DEFICIT) FROM OTHER ACTIVITES** _._ 

|Stage 3 Adaptations<br>Factoring<br>Other Activities<br>Total from other activities<br>2026<br>Total from other activities<br>2025|Grants<br>from<br>Scottish<br>Ministers<br>Other<br>Income<br>Total<br>Turnover<br>Operating<br>Costs -<br>Bad Debts<br>Other<br>Operating<br>Costs<br>2026<br>Operating<br>Surplus/<br>(Deficit)<br>2025<br>Operating<br>Surplus/<br>(Deficit)<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>**£**<br>243,084<br>-<br>243,084<br>-<br>230,942<br>12,142<br>4,750<br>-<br>75,087<br>75,087<br>728<br>65,603<br>8,756<br>19,228<br>-<br>176,115<br>176,115<br>-<br>190,286<br>(14,171)<br>135,536|
|---|---|
||243,084<br>251,202<br>494,286<br>728<br>486,831<br>6,727<br>159,514|
||90,857<br>326,103<br>416,960<br>3,697<br>253,749<br>159,514|



## **5 GAIN / (LOSS) ON SALE OF FIXED ASSET** 

|Proceeds<br>Cost of Disposal<br>Gain / (Loss)|**Shared**<br>**Ownership**<br>**Properties**<br>**£**<br>2,039,452<br>2,039,452<br>-|**Other**<br>**Properties**<br>**£**<br>-<br>-<br>-|**2026**<br>**Total**<br>**£**<br>2,039,452<br>2,039,452<br>-|**2025**<br>**£**<br>-<br>-|
|---|---|---|---|---|
|||||-|



Page 29 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31st March 2026** 

## **6 INTEREST PAYABLE AND FINANCING COSTS** 

|<br>**SURPLUS FOR THE YEAR**<br>Interest arising on:<br>Social Housing debt<br>Interest on defined benefit pension liability<br>This is stated after charging:<br>Auditors’ remuneration (including VAT) - external audit<br>- internal audit<br>Donations to Local Charities<br>(Gain) / loss on disposal of fixed asset<br>Depreciation of housing properties|**2026**<br>**£**<br>2,325,234<br>53,000<br>2,378,234<br>**2026**<br>**£**<br>13,017<br>14,220<br>-<br>88,118<br>3,579,574|**2025**<br>**£**<br>1,931,216<br>49,000|
|---|---|---|
|||1,980,216|
|||**2025**<br>**_£_**<br>12,120<br>12,324<br>-<br>96,801<br>3,295,144|



## **7 SURPLUS FOR THE YEAR** 

## **8 STAFF COSTS** 

At the year-end there were 54.5 full-time equivalent employees (2025: 52.2). Staff costs during the year amounted to: 

|Wages and Salaries<br>National insurance<br>Pensions<br>The average number of persons directly employed by the Association<br>during the year was|**2026**<br>**£**<br>2,046,470<br>278,293<br>446,949<br>2,771,712<br>No.<br>59|**2025**<br>**£**<br>2,000,307<br>211,328<br>420,888|
|---|---|---|
|||2,632,523|
|||No.<br>54|



Page 30 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **8 STAFF COSTS** (continued) 

## **KEY MANAGEMENT PERSONNEL** 

As per the Scottish Housing Regulator’s Determination of Accounting Requirements 2024, disclosure of key management personnel’s emoluments exceeding £60,000 per annum is required. 

|The total emoluments payable to key management personnel and former<br>key management personnel amount to: -<br>Emoluments excluding employers’ pension<br>Employers pension contributions<br>The emoluments (excluding pension contributions and excluding<br>redundancy payments) of the Officers were in the following ranges:<br>£60,000 - £70,000<br>£70,001 - £80,000<br>£80,000 - £90,000<br>£90,001 - £100,000<br>£100,001 - £110,000<br>£110,001 - £120,000|**2026**<br>**£**<br>388,880<br>38,216<br>427,097<br>**No.**<br>-<br>-<br>1<br>2<br>-<br>1<br>4|**2025**<br>**£**<br>369,968<br>36,326|
|---|---|---|
|||406,115|
|||**No.**<br>-<br>-<br>3<br>-<br>-<br>1|
|||4|



No emoluments were paid to any member of the Board. 

Page 31 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **9 TANGIBLE FIXED ASSETS** 

|**a) Housing Properties**<br>**Cost:**<br>At 1stApril 2025<br>Works to existing properties<br>Additions<br>Disposals<br>Transfer to complete<br>At 31 March 2026<br>**Depreciation:**<br>At 1stApril 2025<br>Provided during year<br>Eliminated on disposals<br>At 31stMarch 2026<br>**Net book value:**<br>At 31stMarch 2026<br>At 31stMarch 2025|Wholly<br>Owned<br>Completed<br>**£**<br>172,574,824<br>3,387,181<br>-<br>(603,962)<br>14,303,565<br>189,661,608<br>41,748,097<br>3,579,574<br>(522,161)<br>44,805,510<br>144,856,098<br>130,826,727|Wholly<br>Owned in<br>Course of<br>Construction<br>**£**<br>16,253,945<br>-<br>3,376,258<br>(7,092)<br>(14,303,565)<br>5,319,545<br>-<br>-<br>-<br>-<br>5,319,545<br>16,253,945|Shared<br>Ownership<br>Completed<br>**£**<br>99,241<br>-<br>-<br>-<br>-<br>99,241<br>-<br>-<br>-<br>-<br>99,241<br>99,241|Total<br>**£**<br>188,928,009<br>3,387,181<br>3,376,258<br>(611,054)<br>-|
|---|---|---|---|---|
|||||195,080,394|
|||||41,748,097<br>3,579,574<br>(522,161)|
|||||44,805,510|
|||||150,274,884|
|||||147,179,913|



Total works carried out on housing properties for the year ended 31[st] March 2026 was £4,346,312 (2025 - £4,406,604). Of this total £3,387,181 (2025 - £3,227,458) was capitalised above and £959,131 (2025 - £1,179,146) was expensed in the Statement of Comprehensive Income in line with recommended practice. 

During the year, the Association had capitalised salary and interest costs of £599,778 (2025 - £761,325). 

|**b) Fixed Asset Investments**<br>**Cost:**<br>As 1stApril 2025<br>Disposals during the year<br>Additions during the year<br>As at 31stMarch 2026<br>Net book value at 31st March 2025|**Homestake**<br>**£**<br>-<br>-<br>-<br>-<br>-|**Subsidiary**<br>**£**<br>1<br>-<br>-<br>1<br>1|**Total**<br>**£**<br>1<br>-|
|---|---|---|---|
||||1|
||||1|



The wholly owned subsidiary Musselcrag Limited was dormant throughout the financial year. 

Page 32 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **9 TANGIBLE FIXED ASSETS** (continued) 

|**c) Other**<br>**Office &**<br>**Lounges**<br>**Cost:**<br>**£**<br>At 1st April 2025<br>1,098,959<br>Additions during the year<br>29,846<br>Disposals during the year<br>-<br>At 31st March 2026<br>1,128,805<br>**Depreciation:**<br>At 1st April 2025<br>506,529<br>Provided during the year<br>21,979<br>Disposals during the year<br>-<br>At 31st March 2026<br>528,508<br>**Net book value:**<br>At 31st March 2026<br>600,297<br>At 31st March 2025<br>592,430<br>**0 DEBTORS**<br>Amounts falling due within one year:<br>Rental and service charges receivable<br>Less Provision for bad & doubtful debts<br>Net Rental Debtors<br>Recharge Account Debtors<br>Less Provision for bad & doubtful debts<br>Net Recharge Debtors<br>Grants Receivable<br>Other Debtors<br>Prepayment and accrued income|**Computer**<br>**Equipment**<br>**£**<br>74,121<br>-<br>-<br>74,121<br>49,819<br>13,832<br>-<br>63,650<br>10,470<br>24,302|**Office**<br>**Comp**<br>**Van**<br>**Equipment**<br>**Total**<br>**£**<br>**£**<br>**£**<br>2,534<br>-<br>1,175,614<br>6,814<br>36,671<br>73,331<br>-<br>-<br>-<br>9,348<br>36,671<br>1,248,944<br>1,900<br>-<br>558,248<br>634<br>-<br>36,445<br>-<br>-<br>-<br>2,534<br>-<br>594,692<br>6,814<br>36,671<br>654,252<br>634<br>-<br>617,366<br>**2026**<br>**2025**<br>**£**<br>**£**<br>366,042<br>331,326<br>(105,362)<br>(95,549)<br>260,680<br>231,363<br>189,508<br>170,552<br>(135,477)<br>(108,077)<br>54,031<br>62,475<br>101,365<br>33,006<br>250,622<br>174,340<br>239,946<br>239,552<br>906,644<br>745,150|**Total**<br>**£**<br>1,175,614<br>73,331<br>-|
|---|---|---|---|
||||1,248,944|
||||558,248<br>36,445<br>-|
||||594,692|
||||654,252|
||||617,366|
|||||



## **10 DEBTORS** 

Page 33 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **11 STOCK** 

Stock 

|**£**|**£**|
|---|---|
|1,602|-|



Stock is valued at the lower of cost and estimated selling price less cost to complete and sell using a weighted average method. 

## **12 CREDITORS** : amounts falling due within one year 

|Loans (note 13)<br>Trade creditors<br>Deferred capital grants<br>Rent in advance|**2026**<br>**£**<br>1,009,250<br>1,843,346<br>1,090,623<br>278,404<br>4,221,623|**2025**<br>**£**<br>281,313<br>2,958,376<br>977,572<br>289,643|
|---|---|---|
|||4,506,904|



## Deferred Capital Grant 

Amounts to be released within one year £1,090,623 (2025: £977,572), amounts to be released in more than one year £79,999,243 (2025: £78,983,155). Deferred capital grant additions in the year £2.7M (2025: £6.5M). 

## **13 CREDITORS** : amounts falling due after more than one year 

|Loans<br>Deferred Income<br>Deferred capital grants|**2026**<br>**£**<br>55,667,571<br>1,959,747<br>79,999,243<br>137,626,561|**2025**<br>**£**<br>46,179,616<br>1,498,575<br>78,983,155|
|---|---|---|
|||126,661,346|



Housing property loans are secured by specific charges on the Association’s properties and are repayable at varying rates of interest in instalments due as follows: 

|Within one year<br>Between one and two years<br>Between two year and five years<br>After five years<br>Included in creditors: amounts falling due within one year|**2026**<br>**£**<br>1,009,250<br>1,013,955<br>3,310,509<br>51,343,107<br>56,676,821<br>(1,009,250)<br>55,667,571|**2025**<br>**£**<br>281,313<br>296,658<br>984,283<br>44,898,675|
|---|---|---|
|||46,460,929<br>(281,313)|
|||46,179,616|



Page 34 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **13 CREDITORS** : amounts falling due after more than one year (cont’d) 

Analysis of changes in loan financing during the year: 

|At 1stApril 2025<br>New loans taken out<br>Amounts repaid<br>At 31st March 2026|**2026**<br>**£**<br>46,460,929<br>10,514,476<br>(298,584)<br>56,676,821|**2025**<br>**£**<br>41,942,569<br>6,000,000<br>(1,481,640)|
|---|---|---|
|||46,460,929|



Borrowing are denominated and repaid in pounds sterling, have contractual interest rates that are either fixed rates or variable rates linked to SONIA that are not leveraged, and do not contain conditional returns or repayment provisions other than to protect the lender against credit deterioration or changes in relevant legislation or taxation. The Association makes quarterly and semi-annually interest payments on all bank borrowings. 

Borrowings mature between September 2033 and September 2048, Fixed rate debt of £26.5M (2025: £26.4M) bear fixed rate coupons between (2.31% - 5.44%) per annum and £30.1M (2025: £20M) variable rate loans bear variable rate coupons of between (1.00% - 1.39% above SONIA). 

Borrowings of £41.8M (2025: £31.8M) are secured by specific charges against the Association’s housing properties. 

## **Derivatives** 

The Association is not permitted to enter into speculative transactions with financial instruments. The Association follows the guidance set out by the Scottish Housing Regulator. Any financial instrument entered into by the Association is covered by underlying loans. As part of its Treasury Management Policy the Association may use financial derivatives to achieve interest rate certainty. At 31[st] March 2026, the Association had no interest rate swaps. 

## **14 SHARE CAPITAL** 

|Shares of £1 each<br>At 1stApril 2025<br>Issued<br>Cancelled<br>At 31st March 2026|**2026**<br>**£**<br>41<br>3<br>-<br>44|**2025**<br>**£**<br>35<br>10<br>(4)|
|---|---|---|
|||41|



## **15 REVENUE RESERVE** 

Reserves of the Association represent the following: _Revenue Reserve_ 

The cumulative surplus / deficit. 

Page 35 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **16 CASH FLOW FROM OPERATING ACTIVITIES** 

|Surplus for year<br>Depreciation and impairment of tangible fixed assets<br>Amortisation of housing association grant<br>Disposals of tangible fixed assets<br>(Increase)/Decrease in stock<br>(Increase) / Decrease in trade and other debtors<br>Increase / (Decrease) in trade and other creditors<br>(Loss) / Gain in respect of pension scheme<br>Increase / (Decrease) in provisions<br>**Net cash flow from operating activities**|**2026**<br>**2025**<br>**£**<br>**£**<br>3,583,053<br>3,508,610<br>3,699,889<br>3,437,038<br>(1,066,230)<br>(995,162)<br>-<br>-<br>(1,602)<br>-<br>(161,494)<br>530,501<br>(1,126,269)<br>279,306<br>232,000<br>165,000<br>(179,000)<br>(116,000)|
|---|---|
||4,980,348<br>6,809,293|



## **17 ANALYSIS OF CHANGES IN NET DEBT** 

|Cash at Bank and in Hand<br>Debt Due within one year<br>Debt Due after one year<br>Total|**At 1 April**<br>**At 31 March**<br>**2025**<br>**Cashflows**<br>**2026**<br>**£**<br>**£**<br>**£**<br>6,731,762<br>8,869,103<br>15,600,864|
|---|---|
||6,731,762<br>8,869,103<br>15,600,864<br>(281,313)<br>(727,937)<br>(1,009,250)<br>(46,179,616)<br>(10,215,891)<br>(56,395,508)|
||(39,729,168)<br>(2,074,725)<br>(41,803,893)|



## **18 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT** 

|Increase in cash and cash equivalents in the year<br>Cash Inflow from increase in net debt<br>Net Debt at 1stApril 2025<br>Net Debt at 31stMarch 2026|**2026**<br>**2025**<br>**£**<br>**£**<br>8,869,103<br>833,937<br>(10,943,828)<br>(4,518,360)|
|---|---|
||(2,074,725)<br>(3,684,423)<br>(39,729,167)<br>(36,044,744)|
||(41,803,892)<br>(39,729,167)|



Page 36 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **19 RETIREMENT BENEFITS** 

The Association participates in the Scottish Housing Associations’ Pension Scheme (the Scheme), a multiemployer scheme which provides benefits to some 150 non-associated employers.  The Scheme is a defined benefit scheme in the UK. 

The Scheme is subject to the funding legislation outlined in the Pensions Act 2004 which came into force on 30 December 2005.  This, together with documents issued by the Pensions Regulator and Technical Accounting Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK. 

The last triennial valuation of the scheme for funding purposes was carried out as at 30 September 2024. This valuation revealed a deficit of £79.5m.  A Recovery Plan has been put in place to eliminate this deficit, which will run from 1 April 2026 for a period of at least four years to 31 March 2030.  This may be extended to 31 March 2032 if the judgement in the court case referenced below results in additional Scheme liabilities. This position will be reviewed at the 2027 valuation. 

The Scheme is classified as a “last-man standing arrangement”. Therefore, the Association is potentially liable for other participating employers’ obligations if those employers are unable to meet their share of the scheme deficit following withdrawal from the Scheme.  Participating employers are legally required to meet their share of the Scheme deficit on an annuity purchase basis on withdrawal from the Scheme. 

The Association accounts for the Scheme as a defined benefit scheme. 

For accounting purposes, a valuation of the scheme is carried out with an effective date of 30 September each year.  The liability figures from this valuation are rolled forward for accounting year-ends from the following 31 March to 28 February inclusive. 

The latest accounting valuation was carried out with an effective date of 30 September 2025.  The liability figures from this valuation were rolled forward for accounting year-ends from the following 31 March 2026 to 28 February 2027 inclusive. 

The liabilities are compared, at the relevant accounting date, with the Association’s fair share of the Scheme’s total assets to calculate the Association’s net deficit or surplus. 

In accordance with FRS 102 section 28, the operating and financing costs of pension and post-retirement schemes (determined by TPT) are recognised separately in the Statement of Comprehensive Income. Service costs are systematically spread over the service lives of the employees and financing costs are recognised in the period in which they arise. The difference between actual and expected returns on assets during the year, including changes in the actuarial assumptions, is recognised in Other Comprehensive Income. 

Full judgement in the Verity Trustees v Wood court case is still awaited.  Should the Court decide that historic benefit changes need to be applied differently, then some member benefits would need to be increased, which would increase the value placed on Scheme liabilities. No allowance has been made for potential additional liabilities within the estimate made, although this will be addressed if required by the potential extension of the Recovery Plan referenced above. 

Page 37 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS** 

## **For the year ended 31[st] March 2026** 

## **19 RETIREMENT BENEFITS** (continued) 

**Fair value of plan assets, present value of defined Benefit obligation, and defined benefit asset (liability)** 

|**2026**<br>**£(000’s)**<br>Fair value of plan assets<br>6,401<br>Present value of defined benefit obligation<br>7,123<br>Surplus / (Deficit) in plan<br>(722)<br>Unrecognised surplus<br>-<br>Defined benefit asset / (liability) to be recognised<br>(722)<br>**Reconciliation of the impact of the Asset Ceiling**<br>Impact of asset ceiling at start of period<br>Effect of the asset ceiling included in net interest cost<br>Actuarial losses (Gains) on asset ceiling<br>Impact of asset ceiling at end of period<br>**econciliation of opening and closing balances of the defined benefit obligation**<br>Defined benefit obligation at start of period<br>Current service cost<br>Expenses<br>Interest Expense<br>Contributions by plan participants<br>Actuarial losses (gains) due to experience<br>Actuarial losses (gains) due to changes in demographic assumptions<br>Actuarial losses (gains) due to changes in financial assumptions<br>Benefits paid and expenses<br>Liabilities acquired in a business combination<br>Liabilities extinguished on settlements<br>Losses (gains) on curtailments<br>Losses (gains) due to benefit changes<br>Exchange rate changes<br>Defined Benefit obligation at end of period|**2025**<br>**£(000’s)**<br>6,515<br>7,416<br>(901)<br>-<br>(901)<br>**2026**<br>**£(000’s)**<br>-<br>**-**<br>-<br>-<br>**2026**<br>**£(000’s)**<br>7,416<br>-<br>13<br>423<br>-<br>(221)<br>67<br>(145)<br>(430)<br>-<br>-<br>-<br>-<br>-|
|---|---|
||7,123|



**Reconciliation of opening and closing balances of the defined benefit obligation** 

Page 38 



Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **19 RETIREMENT BENEFITS** (continued) 

## **Reconciliation of opening and closing balances of the fair value of plan assets** 

|Fair value of plan assets at start of period<br>Interest income<br>Experience on plan assets (excluding amounts included in interest income- gain /<br>(loss)<br>Contributions by Employer<br>Contributions by plan participants<br>Benefits paid and expenses<br>Assets acquired in a business combination<br>Assets distributed on settlements<br>Exchange rates change<br>Fair value of plan assets at end of period|**2026**<br>**£(000’s)**<br>6,515<br>370<br>(67)<br>13<br>-<br>(430)<br>-<br>-<br>-|
|---|---|
||6,401|



The actual return on the plan assets (including any changes in share of assets) over the period from 31 March 2025 to 31 March 2026 was £303,000. 

## **Defined benefit costs recognised in statement of comprehensive income (SoCI)** 

|Current service cost<br>Expenses<br>Net interest expense<br>Losses (gains) on business combinations<br>Losses (gains) on settlements<br>Losses (gains) on curtailments<br>Losses (gains) due to benefit changes<br>Defined benefit costs recognised in statement of comprehensive income (SoCI)|**2026**<br>**£(000’s)**<br>-<br>13<br>53<br>-<br>-<br>-<br>-|
|---|---|
||66|



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Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **19 RETIREMENT BENEFITS** (continued) 

## **Defined Benefit Costs recognised in other comprehensive income** 

|Experience on plan assets (excluding amounts included in net interest cost – gain (loss)<br>Experience gains and losses arising on the plan liabilities – gain (loss)<br>Effects of changes in the demographic assumptions underlying the present value of the<br>defined benefit obligation – gain (loss)<br>Effects of changes in the financial assumptions underlying the present value of the<br>defined benefit obligation – gain (loss)<br>Total actuarial gains and losses (before restriction due to some of the surplus not being<br>recognisable gains (loss)<br>Effect of changes in the amount of surplus that is not recoverable (excluding amounts<br>Included in net interest cost) – gain (loss)<br>Total amount recognised in other comprehensive income – gain (loss)|**2026**<br>**£(000’s)**<br>(67)<br>221<br>(67)<br>145|
|---|---|
||232<br>-|
||232|



## **20 RELATED PARTY TRANSACTIONS** 

Two members of the Board are also tenants of the Association (2025 – Two). The tenancies are on the same terms as for other tenants and no advantage can be gained from the position. 

During the financial year, Board members were charged rent totalling £12,164 (2025 - £11,530).  As at 31 March 2026 £Nil (2025 - £Nil) was due to the Association. 

Where members of the Board are also councillors or employees of related local authorities, there are no transactions to disclose that were not made at arm’s length or not made under the normal commercial terms. 

No Board members received remuneration however members of the management board were reimbursed for out-of-pocket expenses amounting to £250 (2025 - £395). 

## **21 CAPITAL COMMITMENTS** 

|Contracted less certified<br>Authorised but not contracted|**2026**<br>**2025**<br>**£**<br>**£**<br>7,650,999<br>4,595,822<br>-<br>-|
|---|---|



The Board of Management expects the majority of the expenditure they have authorised to be fully financed by Housing Association Grant from The Scottish Government or by mortgages from private sector lenders. 

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Docusign Envelope ID: 595A6940-3776-86CB-8167-58FA4C8F950E 

## **NOTES TO THE FINANCIAL STATEMENTS For the year ended 31[st] March 2026** 

## **22 OTHER COMMITMENTS** 

The Association’s total commitments under non-cancellable operating leases are as follows: 

|Other operating leases<br>Within one year<br>Between one and five years|**2026**<br>**£**<br>35,790<br>69,247<br>105,037|**2025**<br>**£**<br>32,383<br>120,270|
|---|---|---|
|||152,653|



## **23 SUBSIDIARIES INFORMATION** 

Details of the investments in which the company holds more than 10% of the nominal value of any class of share capital are as follows: 

|**Name of**<br>**Company**|**Country of**<br>**Registration or**<br>**Incorporation**|**Date of**<br>**Incorporation**|**Proportion of**<br>**Voting Rights**|**Nature of**<br>**Business**|
|---|---|---|---|---|
|**Subsidiary**<br>**Undertakings**<br>Musselcrag<br>Limited|Scotland|19/08/2010|Wholly Controlled|Dormant since<br>incorporation|



## **24 CONTINGENT LIABILITY** 

The Association participates in a multi-employer pension scheme. Should the Association leave the scheme, the amount of employer debt has been estimated at £1,745,379 as of 30th September 2025. Currently, there is no plan for leaving the scheme. The Association has taken the decision to close the Defined Benefit structure to all staff, replacing it with the Defined Contribution option, which remains within the SHAPS scheme. 

## **25 POST BALANCE SHEET EVENT** 

In June 2026, the Association purchased a new office building at Ethiebeaton in Angus at a cost of £1,208,390. During the 2026/27 financial year, we will be progressing the work to alter this building so that it can be the HQ for the Association and accommodate 60 staff, meeting facilities and flexibility for the Association to accommodate future growth withing the building. 

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