EMPLOYERS_FOR_CHILDCARE - Accounts
EMPLOYERS_FOR_CHILDCARE - Accounts
The directors present their annual report and financial statements for the year ended 31 May 2021.
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 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).
Employers For Childcare is established to make it easier for parents with dependent children to get into work and to stay in work. We do this by addressing childcare as an economic and a labour market issue.
The Charity's purposes, as set out in our governing document, are to advance education, to prevent and relieve poverty and to relieve those in need by reason of financial hardship or other disadvantage by:
promoting the provision and use of good quality registered childcare for the benefit of children and their parents
providing information on all aspects of childcare and work-related issues, and raising awareness of the support available for parents including financial support with childcare costs, and associated employment rights
undertaking and publishing research into all aspects of childcare and work-related issues including parental entitlements and the provision of childcare
raising awareness of issues relating to provision of childcare facilities and parental entitlements.
These purposes are intended to benefit families, particularly working parents with dependent children, and those parents who are seeking to get back into work. More broadly, the public at large benefits through the economic development generated through broadening the pool of potential employees within the workforce, lifting families out of poverty and facilitating children's access to high quality early years education and childcare.
The directors have paid due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake.
Through investment into our charity from our social enterprise, of almost £7million since 2008, we have made a difference in the lives of over 100,000 families across the UK. Our charity works directly with parents through the Family Benefits Advice Service, and for parents though our research, policy, and lobbying work.
To achieve the charity's purposes, during the year under review, we undertook a range of activities. We continued to deliver support and helped putting money back in the pockets of hard-pressed families, and the economy, at what was a challenging time for everyone. We provided a Family Benefits Advisory Service offering free, impartial, and confidential advice and information on childcare and work-related issues both through operating a Freephone helpline and through delivering outreach, for example, presentations and one to one advice sessions in community and employer settings.
We helped over 13,400 people, including parents and children. We carried out almost 4,000 calculations for parents. We scheduled 85 online outreach sessions. Almost 150,000 people engaged with our services in person, online and by telephone. In terms of delivering impact through the Family Benefits Advice Service - 97% of parents would recommend our services to other parents - 98% of parents rate the quality of the service as excellent or good.
Some quotes from satisfied clients include:
“Always very friendly yet professional advice received from Jimmy, Brenda & Chris. Each so helpful in all the queries I have had over the past 4 years at different stages of childcare and work changes. Have helped me so much with calculations re Tax Credits. Much appreciated and definitely recommend this team.”
“Both my partner and I are working parents, we were struggling to figure out how to make childcare more affordable, I reached out to Employers For Childcare who directed me what was best to suit our family - the savings have made such a difference to the stress and financial difficulty we were facing, can’t recommend these guys enough”.
2020/21 saw the establishment of the new All-Party Group on Early Education and Childcare, chaired by Chris Lyttle MLA, for which we are delighted to provide secretariat. This is a critical development, already playing a key role in pushing for progress on a Childcare Strategy. Meeting virtually, the Group has heard from senior officials from the Departments of Education and Health, and high-profile experts on childcare from across Great Britain and the Republic of Ireland.
The results for the period are as set out on pages 11 to 30. The charity returned net incoming resources of £244,937 (2020 - £81,954). At 31 May 2021 the level of unrestricted reserves held was £3,245,344 (2020 - £2,974,607).
The Directors are obliged to ensure that sufficient reserves are available to allow the organisation to continue its work in the foreseeable future. From June 2008 the main source of income is the trading activity of Employers For Childcare Trading. The Directors would wish to carry reserves of six month's running costs.
Like many other organisations the global Covid-19 pandemic continues to have a significant impact on the charity.
With the ongoing pandemic the charity has since the year end seen an increase in advice being provided by our Family Benefits Advice Service as more and more parents looked at what options were available to them in Covid-19 affected society.
In July 2020, the Directors made the decision that given the ongoing impact of the Covid-19 pandemic, with restricted opening and the very real possibility of further local restrictions, that they would curtail the High Rise operations until such time that normal operations could resume. As a result, the decision was made to make all High Rise Staff redundant on 31 July 2020 at a cost to the organisation of £9,681.
At the date of approving the financial statements local restrictions are still in place and High Rise is unable to operate normally. Directors have taken the decision to re-open High Rise complex when the company can operate without Covid-19 restrictions and when it is financially viable to do so.
The company is in the enviable position in being able to close High Rise due to self-funding of the operation, with no external financing in place and negligible additional running costs caused by not operating. The Directors believe that the closure of the High Rise facility has not had a detrimental impact on the results of the charity.
The coronavirus pandemic which began in 2020 continues to impact on the wider economy and has led to some uncertainty for not-for profit organisations. However, the Directors continue to closely monitor the ongoing pandemic, taking all steps necessary to mitigate risks where possible and are very positive in being able to navigate through the challenge successfully. They plan to reopen High Rise in summer 2022.
The charity is a company limited by guarantee and is governed by its Memorandum and Articles of Association.
The directors who served during the year and up to the date of signature of the financial statements were:
The Board is responsible for the overall governance of the charity. Directors are either elected or co-opted and the total number of directors shall not be subject to any maximum but shall not be less than two.
The Board delegates the exercise of certain powers in connection with the management and administration of the charity to the Audit and Risk Committee. This is controlled by regular reporting back to the Board, so that all decisions made under delegated powers can be ratified by the full board in due course.
The Chief Executive Officer is responsible for the day to day management of the charity's affairs and for implementing the policies agreed by the Board of Directors.
The directors who also act as trustees for the charitable activities of Employers for Childcare, are responsible for preparing the Directors' 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;
- 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 directors are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the group and 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 group and charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The auditor, GMcG LISBURN, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
The directors' report was approved by the Board of Directors.
Opinion
We have audited the financial statements of Employers for Childcare (the ‘parent charitable company’) for the year ended 31 May 2021 which comprise the group statement of financial activities, the group statement of financial position, the company statement of financial position, the group statement of cash flows, the company 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:
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 directors' 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the directors' report, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the directors' report has been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the group and parent charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; 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 directors' report and from the requirement to prepare a strategic report.
As explained more fully in the statement of directors' 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 group's and parent charitable company'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.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
In identifying and assessing potential risks of material misstatement in respect of irregularities, including fraud and non-compliances with laws and regulations, we considered the following:
The nature of the industry and sector, control environment and business performance, including the group's and company’s remuneration policies for directors, bonus levels and performance targets, if any;
Results of our enquiries of management about their own identification and assessment of the risks of irregularities;
Any matters we identified having obtained and reviewed the group's and company’s documentation of their policies and procedures relating to:
Identifying, evaluating and complying with laws and regulations and whether they were aware of any instance of non-compliance;
Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
The internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
The matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the group and company for fraud and identified the greatest potential for fraud in income recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the group and company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006, and local tax legislation.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group's and company’s ability to operate or to avoid a material penalty.
Our procedures to respond to the risks identified included the following:
Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
Enquiring of management concerning actual and potential litigation and claims;
Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
Reading minutes of meetings of those charged with governance and reviewing correspondence with tax authorities; and
In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. In addition, as with any audit, there remains a higher risk of non-detection of irregularities, as they may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
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 charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members 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 and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
INCLUDING INCOME AND EXPENDITURE ACCOUNT
Tax on activites
The statement of financial activities includes all gains and losses recognised in the year.
All income and expenditure derive from continuing activities.
Employers for Childcare is a private company limited by guarantee incorporated in Northern Ireland. The registered office is 11 Blaris Industrial Estate, 11 Altona Road, Lisburn, Co. Antrim, BT27 5QB.
The financial statements have been prepared in accordance with the charity's Memorandum and Articles of Association, the Companies Act 2006, FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the Charities SORP "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. The principal accounting policies adopted are set out below.
The consolidated financial statements incorporate those of Employers for Childcare and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits).
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
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.
Income from charitable activities provides core funding to support the charity's activities and is recognised in full in the statement of financial activities in the year in which they are receivable,
The charity receives government grants in respect of the provision of specified services, projects and activities. Income from government and other grants are recognised at fair value when the charity has entitlement after any performance conditions have been met, it is probable that the income will be received and the amount can be measured reliably. If entitlement is not met then these amounts are deferred.
Income from trading activities provides additional funding to support the charity's activities and is recognised in full in the statement of financial activities in the year in which they are receivable.
Investment income is included in the year in which it is receivable.
All expenditure is accounted for on an accrual basis and has been classified under headings that aggregate all costs related to the category. Expenditure is recognised where there is a legal or constructive obligation to make payments to third parties, it is probable that the settlement will be required and the amount of the obligation can be measured reliably. It is categorised under one of the following headings: Costs of raising funds, Expenditure on charitable activities and Other expenditure.
Irrecoverable VAT is charged as an expense against the activity for which expenditure arose.
Support costs are those that assist the work of the charity but do not directly represent charitable activities and include office costs, governance costs, depreciation costs and administrative payroll costs. They are incurred directly in support of expenditure on the objects of the charity and include project management carried out at the office. Office costs, depreciation costs governance costs and payroll costs are allocated to charitable activities based on useage. The allocation of the support costs is analysed in note 11.
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.
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.
There is no liability in respect of the Charity due to the charitable status.
Taxation in the year comprises current and deferred tax and relates to the activities of the charity's subsidiary company. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.
Current or deferred taxation assets and liabilities are not discounted.
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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.
Employers for Childcare participate in The Pensions Trust Northern Ireland Charities Pension Scheme (the "Scheme"). The Scheme is a multi-employer defined benefit scheme. The Scheme is funded and is contracted in to the state scheme.
In accordance with FRS102, Section 28 Employee Benefits, paragraph 11, as sufficient information is not available to use defined benefit accounting for a multi employers plan, the charity has accounted for the plan as a defined contribution scheme recognising the contributions payable for the year.
The charity is a participant in an agreement with the Scheme to fund the scheme's deficit. Accordingly the charity has recognised a liability for the contributions payable that arise from the agreement.
The charity proportion of the agreed deficit plan is measured on an actuarial basis using the projected unit method and is recognised in the accounts as a pension liability.
Obligations for contributions to the stakeholder pension plan are recognised as an expense in the statement of comprehensive income as incurred.
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.
The annual depreciation charge on fixed assets depends primarily on the estimated lives of each type of asset and estimates of residual values. The directors regularly review these assets lives and change them as necessary to reflect current thinking on remaining lives in light of prospective economic utilisation and physical condition of the assets concerned. Changes in assets lives can have a significant impact on depreciation charges for the period. Detail of the useful lives is included in the accounting policies.
Lottery fund
Childcare voucher administration fees
Coronavirus job retention scheme grant
Other coronavirus funding
Family Friendly Employer Award Sponsorship
Business Development
Travel
Printing & publicity
To make it easier for parents with dependent children to get into work and to stay in work.
Telephone
Computer costs
Premises expenses
Insurance
Bank fees
Security costs
Postage and stationery
Legal & Professional
Sundry expenses
Staff training and recruitment
The basis of allocation of the support costs identified above is a mixture of the percentage of time spent on each activity and the pro rata cost of each direct cost when compared to the support cost.
Governance costs includes payments to the auditors of £4,900 (2020- £7,593) for audit fees.
The average monthly number of employees during the year was:
The charity considers its key management personnel to comprise of the Chief Executive Officer and the senior management team. The total employment benefits including employer pension contributions of the key management personnel were £190,864 (2020 - £278,314).
Details of the charity's subsidiary at 31 May 2021 is as follows:
Employers for Childcare Trading Limited
Registered office: 11 Blaris Industrial Estate, 11 Altona Road, Lisburn, BT27 5QB
Nature of business: Other business support activities
This company is limited by guarantee and is deemed to be controlled by the charity.
The charity participates in a multi-employer scheme which provides benefits to some 12 non-associated employers. The scheme is a defined benefit scheme in the UK.
It is not possible for the charity to obtain sufficient information to enable it to account for the scheme as a defined benefit scheme. Therefore it accounts for the scheme as a defined contribution scheme.
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 Pension Regulator and Technical Actuarial Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK.
The scheme is classified as "last-man standing arrangement". Therefore the charity 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.
A full actuarial valuation for the scheme was carried out at 30 September 2019. This actuarial valuation showed assets of £34.5m, liabilities of £37.8m and a deficit of £2.4m. To eliminate this funding shortfall, the scheme trustee asked all participating employers to pay additional contributions to the scheme from 01 August 2020 - 29 February 2028 totalling £1,280,605.
The recovery plan contributions are allocated to each participating employer in line with their estimated share of the scheme liabilities.
Where the scheme is in deficit and where the charity has agreed to a deficit funding arrangement the charity recognises a liability for this obligation. The amount recognised is the net present value of the deficit reduction contributions payable under the agreement that relates to the deficit. The present value is calculated using the discount rate detailed in these disclosures. The unwinding of the discount rate is recognised as a finance cost.
The discount rates shown above are the equivalent single discount rates which, when used to discount the future recovery plan contributions due, would give the same results as using a full AA corporate bond yield curve to discount the same recovery plan contributions.
Amounts recognised in the income statement:
Amounts taken to other comprehensive income:
The amounts included in the statement of financial position arising from the charity's obligations in respect of defined benefit plans are as follows:
Movements in the present value of defined benefit obligations:
1 June 2020
31 May 2021
Health & Social Care Trust
To enable Family Benefits Advice Service to provide information, advice and guidance to families.
Big Lottery fund
To purchase fixed assets.
There were no disclosable related party transactions during the year (2020 - none).
The group had no debt during the year.
The group had no debt during the year.