HEREFORDSHIRE_MIND - Accounts

The Trustees present their annual report and financial statements for the year ended 31 March 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 constitution, the Companies Act 2006 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's objects are to focus on assisting in relieving and rehabilitating persons suffering from mental disorders or conditions of emotional or mental distress. There is unrestricted access to our services for all affected by such conditions and in consequence the activities delivered are for public benefit.

Our vision is of a world where everyone gets the respect and support they need to achieve good mental wellbeing.

To realise this, our Mission is to provide quality support, whilst raising awareness and promoting understanding about mental health issues.

We are (our Values)...

Independent: we will use our independence to speak out on behalf of people with mental health problems.

Responsive: we listen to what people tell us and act on this.

Open: we are transparent and accountable in all that we do.

Collaborative: working with others, we achieve more.

Creative: we nurture creativity and innovation.

The Trustees have paid due regard to guidance on public benefit issued by the Charity Commission in deciding what activities the Charity should undertake.

Our nursing based care home provision from our "Shires" care home on Aylestone Hill, Hereford offers a slow stream recovery model for residents with serious and enduring mental health problems. Regrettably this is due to close in December 2022 - see achievements and performance for further detail.

We continue to provide Community Hub Activities, which is the original core service, operating from our hub in Heffernan House, with "outreach" across the county delivering activities and support-based work.

With the changes in public sector funding, Herefordshire Mind has been under continuing pressure to seek additional sources of funding and we are grateful for the considerable support from the public and charitable funders.

We remain dependent on funding, donations, corporate sponsorship and legacies for much of what we deliver and we would like to thank all those organisations, national and local, charitable foundations and individuals who have helped to sustain our work.

April 2021 – April 2022 Herefordshire Mind has continued to expand within the community of Herefordshire and ensure that we reach out across the county. Covid-19 continues to pose challenges with staffing levels and management of our nursing home; and the Trustees would like to pay tribute to all of our staff, who have continued to work tirelessly, adapting to growing demands ensuring that we maintain continuity of existing services and also build and expand our new initiatives in support of our communities.

We are working to develop our community offer and over the last year have seen demand for services grow. We want to be able to offer open door access to all and a route to ensuring that people can receive mental health support and take steps to manage their own recovery journey with Mind services there to help.

Herefordshire Mind's services across the community now include our Safe Haven service which runs 7 days a week, for people in mental health crisis. Expanding counselling services which are funded through charitable donations including grants from the Schuh Trust and Eveson Trust. We now also deliver a range of peer support services with a specific peer run complex emotional needs service.

Our community support teams continue to work 1-1 with individuals across the county and our Housing In Mind Service, Ferncroft, offers supported accommodation to 9 residents. Weekly activities continue at Heffernan House with our Art groups expanding to four sessions a week and a regular Friday music group. In 2022 we have also expanded groups into the rural area with an ‘In to the Woods’ activity group.

In Sept 2021 we successfully secured the sale of Miller Court which meant we were able to settle our longstanding loan with Big Issue Invest and discharge all liabilities on this building. The Trustees would like to acknowledge the exceptional support provided by Big Issue Invest since their involvement with this project dating back to 2015. Their continued support was key in enabling the eventual discharge of this liability.

Over 2022 we have had to make the difficult decision to close our Mental Health Nursing Home, The Shires. We have been running this home for over 20 years but the pressures of infection control and Covid-19 highlighted that the old building of The Shires was no longer fit for purpose and we have been working closely with the NHS and the local authority to manage a planned closure of the home in December 2022. We want to recognise the exceptional work of all those staff involved in this closure and particularly our Registered Manager who has led the staff team and residents through this difficult period. In the words of one of our exiting nurses ‘The Shires has always been a special and unique Sanctuary where I have witnessed the best Service given to people in Mental health facilities, and you should all be proud for actually giving meaning to what ....going the extra mile .....is.’

Partnership working is key to delivering successful services within Herefordshire and our work through the Mental Health Transformation project has really helped us develop and build greater partnership working with our Link Worker team sitting as part of the NHS Neighbourhood Mental Health teams. We are also actively involved with the Herefordshire Council Talk Community initiative and the Herefordshire Community Partnership.

As our services change and develop Herefordshire Mind remains committed to serving all those across the county and ensuring that no one has to face a mental health issue alone.

Going concern

At the time of approving the accounts, the Trustees have a reasonable expectation that the Charity has adequate resources to continue in operational existence for a period of at least 12 months from the date of signing these accounts.

The full support of the key stakeholders of the charity has been invaluable.

As we anticipated last year, Herefordshire Mind is increasingly involved in delivering services in response to the strain that Covid-19 and the pandemic has placed on people’s mental health, therefore we had planned for a significant increase in demand and the need to expand our services accordingly.  We continue to be involved in the groundbreaking mental health transformation project establishing a team of link workers to work alongside clinical statutory Mental health teams and also expanding our services into online delivery and counselling.  Fundraising has been challenging but we have benefitted from the increase in Covid-19 related funding and funding for mental health.  We want to ensure that everyone who has faced increased mental health challenges through 2021/22 and beyond does not face those issues alone.

The Charity is a company limited by guarantee incorporated in England and Wales. The Charitable Company is governed by its Memorandum and Articles of Association dated 25 January 1989 and as amended by special resolution dated 16 July 1991, 26 July 1994, 18 January 2000 and 21 November 2001.

The Trustees, who are also the directors for the purpose of company law, and who served during the year and up to the date of signature of the financial statements were:

The Trustees of Herefordshire Mind are appointed either through election at the Annual General Meeting or by co-option by existing Trustees at their meetings during the year. New Trustees are given an induction pack that explains their legal obligations under charity and company law and their proposed role in the charity. They are also given an opportunity to see the charities operations and to meet key employees and the Trustees.

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

The board of Trustees administers the charity. The board appoints a Chief Executive Officer to manage the day to day operations of the charity and there is further delegation, within terms approved by the Trustees. The Chief Executive Officer is Alicia Lawrence.

The pay of key management personnel is set by the Board having due regard to responsibilities, experience and rates of pay in the health sector.

Each of the Trustees 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 Trustees' report was approved by the Board of Trustees.

The Trustees, who are also the directors of Herefordshire Mind for the purpose of company law, are responsible for preparing the Trustees' 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 Trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Charity and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.

In preparing these financial statements, the Trustees 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;

- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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

The Trustees 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 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 Herefordshire Mind (the ‘Charity’) for the year ended 31 March 2022 which comprise the statement of financial activities, the balance sheet, the statement of cash flows and the 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 charitable company's affairs as at 31 March 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.

Basis for opinion

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

In auditing the financial statements, we have concluded that the Trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material 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 Trustees with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The Trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing 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.

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

the information given in the financial statements is inconsistent in any material respect with the Trustees' report; or

sufficient accounting records have not been kept; or

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

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

As explained more fully in the statement of Trustees' responsibilities, the Trustees, who are also the directors of the Charity for the purpose of company law, are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Trustees are responsible for assessing the Charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

- an understanding of the risk assessment process (including the assessment of the risk of fraud) adopted by the Board is obtained and their attitude to risk ascertained

- an assessment of the susceptibility to material mis-statement of the financial statements as a result of management over-ride or fraud is made

- it is ensured that the engagement team have, collectively, the appropriate competence, capabilities and skills to be involved in the assignment, are fully briefed and understand the risks specific to the charity

The information obtained through the assessment to risk procedures is reviewed and the following work undertaken:

- processes to test the outcomes of our assessment include, a review of Board minutes, analytical review, the relevance and accuracy of significant accounting estimates, substantive testing of significant transactions, work to identify unusual or unexpected accounting entries including the testing of journal entries, information disclosed in the financial statements is traced to supporting documentation. In all instances it is acknowledged that material mis-statements that arise from fraud may involve deliberate concealment or collusion and are, therefore, by their very nature harder to detect than those arising from error.

- an understanding of the legal and regulatory framework as applicable to the charity is obtained together with knowledge of the procedures put in place by the charity in order to comply with the same

It should be noted that Auditing standards limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

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.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with section 391 of the Companies Act 2014. Our audit work has been undertaken so that we might state to the company’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 company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Kendall Wadley LLP is eligible for appointment as auditor of the Charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.

Activities for generating funds

Loan interest

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

All income and expenditure derive from continuing activities.

Activities for generating funds

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

All income and expenditure derive from continuing activities.

The company is entitled to the exemption from the audit requirement contained in section 477 of the Companies Act 2006, for the year ended 31 March 2022, although an audit has been carried out under section 144 of the Charities Act 2011.

The Trustees acknowledge their responsibilities for ensuring that the charity keeps accounting records which comply with section 386 of the Act and for preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of the financial year and of its incoming resources and application of resources, including its income and expenditure, for the financial year in accordance with the requirements of sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the company.

The members have not required the company to obtain an audit of its financial statements under the requirements of the Companies Act 2006, for the year in question in accordance with section 476.

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

Herefordshire Mind is a private company limited by guarantee incorporated in England and Wales. The registered office is Heffernan House, 130-132 Widemarsh Street, Hereford, HR4 9HN.

The financial statements have been prepared in accordance with the Charity's Memorandum and Articles of Association, the Companies Act 2006 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 accounts have been prepared under the historical cost convention, modified to include freehold property held for resale and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

At the time of approving the accounts, the Trustees have a reasonable expectation that the Charity has adequate resources to continue in operational existence for a period of at least 12 months from the date of signing these accounts.

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

Designated funds comprise funds which have been set aside at the discretion of the Trustees for specific purposes. The purposes and uses of the designated funds are set out in the notes to the financial statements.

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.

Cash donations are recognised on receipt. Other donations are recognised once the Charity has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.

All expenses are accounted for on an accruals basis. Liabilities are recognised when they are incurred.

Costs of generating funds comprise those costs directly attributable to raising funds through activities.

Direct charitable expenditure includes all overhead costs in supporting the direct charitable activities.

Governance costs comprise those costs not already deemed as overhead costs and not associated with achieving the direct charitable activities.

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 the statement of financial activities.

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).

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the current market value of similar assets are assessed.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in income/(expenditure) for the year, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately, unless the relevant asset is carried in at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Freehold property held for sale is recorded at the market value at the balance sheet date.

Cash and cash equivalents include cash in hand, deposits held at call with banks, and other short-term liquid investments with original maturities of three months or less.

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.

In the application of the Charity’s accounting policies, the Trustees 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. Such estimates include the establishment of an appropriate depreciation policy in respect of tangible fixed assets to ensure book value is compatible with market value. 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.

Activities for generating funds

Activities for generating funds

Other Covid related grant funding

Recovery and wellbeing

Community Support/ Housing

Residential Homes

Intensive Support/ CST

Property

Catering/ Consumables

Transport

Depreciation/ Other

Herefordshire PCT

Loan interest

Recovery and wellbeing

Community Support/ Housing

Residential Homes

Intensive Support/ CST

Property

Catering/ Consumables

Transport

Depreciation/ Other

Herefordshire PCT

In accordance with an agreement made with the lenders in December 2020, the proceeds on the sale of Miller Court satisfied the capital outstanding to the lenders at the point of sale such that under the revised terms of the agreement the interest that had accumulated was waived.

No trustees received remuneration or expenses in the year.

Property

Administration

Other governance costs

The average monthly number employees during the year was 60 being 10 full time and 50 part time appointments (2021: 51 employees being 9 full time and 42 part time appointments)

The remuneration of key management personnel is £193,449 (2021: £214,038).

The transfers made relate to internal recharges or designation of funds as described in the designated funds note.

The long-term loans were secured by fixed charges over all of the freehold properties held by the Charity.

At 31 March 2021 the long term loans were made up of:

a) Big Issue Invest amounting to £186,582, representing £150,000 capital and £36,582 accumulated interest. No interest was charged in the year. The original terms required interest to be repaid until January 2018, with the remaining period to maturity in March 2024 being repayable as equal monthly capital and interest repayments. Interest being charged at 10.5%. However, these terms were varied such that interest was frozen at 30 June 2018.

b) Big Issue Invest amounting to £100,137, representing £82,721 capital and £17,416 accumulated interest. No interest was charged in the year. The original terms required interest to be repaid until January 2018, with the remaining period to maturity in March 2024 being repayable as equal monthly capital and interest repayments. Interest being charged at 10.5%: However, these terms were varied such that interest was frozen at 30 June 2018 with quarterly capital payments of £1,728 being made.

c) Other loans included from the Big Issue Social Enterprise Investment Fund amount to £1,787,009, representing £1,517,280 capital and £269,729 accumulated interest. No interest was charged in the year. The original terms of the loan were that interest would accrue at 9.75% until it became repayable in April 2017, at which point interest of 9.75% and capital repayments would be made. However, these terms were varied during such that interest was frozen. Quarterly capital payments of £10,722 were made,

In December 2020 the loans were re-negotiated. The terms were extended for a further two years, with the final payment due on 1 November 2022. Interest continued to be frozen, and quarterly capital repayments remained the same. It was also agreed that in the event of achieved sale proceeds of the Miller Court Development being less than the principal capital amounts outstanding, the accumulated interest would be waived.

A sale of the property was achieved in September 2021 and the above liabilities extinguished as agreed.

Deferred income is included in the financial statements as follows:

Deferred income represents amounts received in advance of the provision of services contracted and is released in the subsequent accounting period.

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 the statement of financial activities in respect of defined contribution schemes was £12,275 (2021: £9,648)

Contributions due to the scheme at the balance sheet date are included in creditors and amounted to £3,034 (2021: £3,470).

Young People fund is donations designated for work with 18 to 25 year olds.

Heffernan Activity fund will be used towards the cost of running activities at Heffernan House which are not funded from any other grants.

Ferncroft fund will be used to improve the property and support the tenants (for example with emergency supplies).

Heffernan/Safe Haven fund will be used to improve the environment at Heffernan House for clients accessing our Safe Haven service and other activities.

Shires Property - funds set aside for the closure of the Shires.

Organisation Training - Young People funds re-designated for training.

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:

The amount expensed in the year was £2,187 (2021: £2,193).

At 31 March 2022 the Charity had capital commitments as follows:

There were no related party transactions during the year.