MRS_MURRAY’S_HOME_FOR_STR - Accounts

The directors present their report and financial statements for the year ended 28 February 2022.

The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the charity's governing document, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) and "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)".

Principal activities

The principal activities of the company are to provide a temporary home for lost dogs and cats and to restore to their present owners dogs and cats which have been lost and brought to the Home and, failing this, to find if possible new and suitable homes for them.

The Home provided care and boarding to 297 Cats (2021 - 117) and 878 Dogs (2021 - 371) during the year. This amounts to an increase of 140.78%. The number of stray animals handled by the Home was 10 Cats (2021 - 15) and 73 Dogs (2021 - 52). This amounts to an increase of 23.88%. Homes were found for 100 Cats (2021 - 77) and 111 Dogs (2021 - 84). This amounts to an increase of 31.06%. The number of animals re-homed was 102 Cats (2021 - 85) and 123 Dogs (2021 - 95). This amounts to an increase of 25%. There has been a significant increase in each area due to the lifting of COVID-19 restrictions.

Review of the year

The attached financial statements show that the charity achieved a net surplus of £3,325 (2021 - £455,024). This decrease is mainly due to a decrease in net gains on investments, offset by an increase in income from charitable activities. There was also an increase in investment income received. During the year the company received donations totalling £83,169 as well as 6 legacies totalling £61,130.

Reserves policy

The investments are held for the long term but the charity aims for the cash on deposit to approximate to over six months operating expenditure, and this ensures that the Home will be able to continue its current activities even if there is a drop in legacies received, or if there is a slump in the stock market. The reserves were £5,831,215 at 28 February 2022 (2021 - £5,827,890).

Investment policy

The directors consider that the most appropriate policy for investing surplus funds is within interest bearing bank accounts for short term purposes and in shares and government stocks for long term purposes. The management of the investments is delegated to Rathbones on Discretionary Management Terms. The investment objective undertaken by Rathbones is a balance between capital growth and income with a medium risk profile which includes exposure to large overseas listing companies and a proportion of medium sized and smaller UK companies.

Plans for future periods

The charity is continuing to upgrade the support services accommodation and carry out general refurbishment works at the premises.

Governing document

The company is a charitable company limited by guarantee, incorporated on 29 January 2002 and is recognised by the HM Revenue & Customs as a charity. The company was established under a Memorandum of Association which established the objects and powers of the charity and is governed under its Articles of Association. There are currently 20 members, each of whom agree to contribute an amount not exceeding £1 in the event of the company being wound up.

The directors who served during the year are as follows -

Appointment of directors

The directors of the company are also charity trustees for the purposes of charity law. Under the requirements of the Memorandum and Articles of Association, the members of the Board of Directors are elected to serve for a period of three years after which they must be re-elected at the next Annual General Meeting.

Potential directors are identified through their association with the company or by recommendation.

None of the directors has any beneficial interest in the company. All of the directors are members of the company and guarantee to contribute £1 in the event of a winding up.

Organisational structure

The company has a board of directors, currently consisting of 6 members, who meet four times a year and are responsible for the strategic direction and policy of the company. The day to day financial management of the company is carried out by Messrs Ledingham Chalmers LLP the company secretaries, who report to the Board.

Directors induction and training

All existing directors are advised of their duties and responsibilities under charity law by Ledingham Chalmers LLP and are encouraged to visit the Home and observe the Charity in action on a regular basis.

Key management personnel

The directors ensure the charity is run effectively through its management structure. The Home manager is responsible for the operational management of the charity.

Risk management

The directors, along with senior management, have identified the major risks to which the charity is exposed. These are regularly reviewed, and systems established to mitigate those risks.

Apart from income received from re-housing and boarding, and investment income, which is insufficient to meet resources expended, the Home is totally dependent upon donations, fundraising and legacies. While this, in theory, places the provision of services at risk, due to the large amount of funds built up over the years it is not anticipated that there is any risk to services provided for the foreseeable future.

The advent of the coronavirus pandemic in March 2020 has had a significant adverse impact on many organisations throughout the UK, and Mrs Murray’s Home is no exception. Income from the care and boarding of cats and dogs has fallen as a result, but other sources of income have continued, and the directors consider that the charity has sufficient reserves to allow them to continue in operation

Each of the directors has confirmed that there is no information of which they are aware which is relevant to the audit, but of which the auditor is unaware. They have further confirmed that they have taken appropriate steps to identify such relevant information and to establish that the auditor is aware of such information.

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies' exemption.

Each of the directors has confirmed that there is no information of which they are aware which is relevant to the audit, but of which the auditor is unaware. They have further confirmed that they have taken appropriate steps to identify such relevant information and to establish that the auditor is aware of such information.

The director's report was approved by the Board of Directors.

The directors, who also act as trustees for the charitable activities of the company, are responsible for preparing the Director's Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company Law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.

In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;

- observe the methods and principles in the Charities SORP;

- make judgements and estimates that are reasonable and prudent; and

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation.

The directors are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) and the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Opinion

We have audited the financial statements of Mrs Murray’s Home for Stray Dogs and Cats (the ‘charity’) for the year ended 28 February 2022 which comprise the statement of financial activities, the balance sheet, the statement of cash flows and the notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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 charitable company's affairs as at 28 February 2022 and of its incoming resources and application of resources, for the year then ended;

have been prepared in accordance with the requirements of the Companies Act 2006, the Charities and Trustee Investment (Scotland) Act 2005 and regulation 8 of the Charities Accounts (Scotland) Regulations 2006 (as amended).

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

In auditing the financial statements, we have concluded that the director'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 charity’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors 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.

In our opinion, based on the work undertaken in the course of our audit:

the information given in the director's report, which includes the directors' report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the directors' report included within the director's report has been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the charity and its environment obtained in the course of the audit, we have not identified material misstatements in the directors' report included within the director's report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities Accounts (Scotland) Regulations 2006 (as amended) requires us to report to you if, in our opinion:

adequate and proper accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

we have not received all the information and explanations we require for our audit; or

the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the director's report and from the requirement to prepare a strategic report.

As explained more fully in the statement of director's responsibilities, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors 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 directors are responsible for assessing the charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

We have been appointed as auditor under Chapter 3 of Part 16 of the Companies Act 2006 and section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and report in accordance with the Acts and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor'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.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud; 

• Reviewing minutes of meetings of those charged with governance;

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection; 

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

• Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Use of our report

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and to the charity’s trustees, as a body, in accordance with regulation 10 of the Charities Accounts (Scotland) Regulations 2006. Our audit work has been undertaken so that we might state to the charitable company's members and trustees those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company, the charitable company’s members as a body,and the charitable company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Grants, donations and legacies

Investment management costs

The statement of financial activities includes all gains and losses recognised in the year.

All income and expenditure derive from continuing activities.

Mrs Murray’s Home for Stray Dogs and Cats is a private company limited by guarantee incorporated in Scotland. The registered office is Johnstone House, 52-54 Rose Street, Aberdeen, AB10 1HA.

The financial statements have been prepared in accordance with the charity's governing document, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) and "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)". The charity is a Public Benefit Entity as defined by FRS 102.

The financial statements are prepared in sterling, which is the functional currency of the charity. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.

At the time of approving the financial statements, the directors have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Unrestricted funds are available for use at the discretion of the directors in furtherance of their charitable objectives.

Restricted funds are subject to specific conditions by donors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Expenditure is recognised on an accruals basis as a liability is incurred.

Cost of raising funds comprise the costs associated with the management of the investment on behalf of the charity.

Charitable expenditure comprises those costs incurred by the charity in the delivery of its activities and services for its beneficiaries. It includes both costs than can be allocated directly to such activities and those costs of an indirect nature necessary to support them.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in net income/(expenditure) for the year.

Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in net income/(expenditure) for the year. Transaction costs are expensed as incurred.

At each reporting end date, the charity reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The charity has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the charity's balance sheet when the charity becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the charity’s contractual obligations expire or are discharged or cancelled.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the charity is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged as an expense on a straight line basis over the term of the relevant lease.

In the application of the charity’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Directors estimate the carrying value of property to the best of their ability based on previous experience and knowledge of the local area.

Directors estimate the investment value based on the expert reports provided by their portfolio managers.

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual value of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets.

Grants, donations and legacies

Covid grants - JRS

Investment management costs

Portfolio management fees

Provisions

Veterinary expenses

Kennel expenses

Dog warden costs

Equipment hire

Insurance

Rates and water

Heat and light

Repairs to property and fittings

Motor expenses

Telephone

Legal and secretarial fees

Professional fees

Printing, stationery and advertising

General expenses

Governance costs includes payments to the auditors of £12,000 (2021- £10,600) for audit fees.

None of the directors (or any persons connected with them) received any remuneration or benefits from the charity during the year.

No trustee expenses have been incurred (2021 - £Nil)

The average monthly number of employees during the year was:

Key Management Personnel

The directors ensure the charity is run effectively through its management structure. The Home manager is responsible for the operational management of the charity. The total remuneration paid to key management personnel was £52,786 (2021 - £52,528).

Depreciation on property additions will commence on completion of building works.

Listed Investments

The historical cost of listed investment is £3,060,351 (2021 - £3,222,243)

The investments are not subject to the limitations of the Trustee Investments Act

The following investment represents more than 5% of the market value of the portfolio of listed investments.

%

Findlay Park Plc American Fund Unhgd (USD)    5.17

Financial Assets Held At Fair Value

All investments are held at stock market valuation.

Due to an overall downward trend in the UK market post 28th February 2022, there has been a decrease on the market value of stocks, bonds and equities held by the Charity. The Trustees do not believe that this is evidence of a permanent impairment to the value of stocks, bonds and equities held by the Charity as at the 28th February 2022 and therefore do not believe this is an example of an adjusting event. The Charity holds investments in stocks, bonds and equities with a view to long term appreciation in value and therefore believe that the market price will recover in the near future.

The charity operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the charity in an independently administered fund.

The charge to profit or loss in respect of defined contribution schemes was £5,830 (2021 - £6,223).

At the reporting end date the charity had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

At 28 February 2022 the charity had capital commitments as follows:

There were no disclosable related party transactions during the year (2021 - none).

The charity had no debt during the year.