The Dulwich Estate Annual Report 2018
The Dulwich Estate Annual Report 2018 1 2 The Dulwich Estate Annual Report 2018 Contents
Chairman’s statement 05
Chief Executive’s foreword 06
Trustees and administrative information 07
Property development 08
Property maintenance 09
A word from our beneficiaries 10 - 13
Who we are 14
2018 financial position and performance 15
Our history and background 17
Trustees’ report 18 - 21
2017-2018 year in review 22 - 23
Independent auditors report to the board 24 -25
Consolidated statement of financial activities 26
Charity statement of financial activities 27
Consolidated summary income and expenditure account 28
Consolidated balance sheet 29
Charity balance sheet 30
Consolidated cash flow statement 31
Notes to the financial statements 32 - 47
The Dulwich Estate Annual Report 2018 3 4 The Dulwich Estate Annual Report 2018 Chairman’s statement
Welcome to our new style annual report which brings together both financial and impact reporting, as part of our improved communications to broaden understanding of the charitable work that we support at The Dulwich Estate. Through the responsible stewardship of the Estate we have achieved strong financial returns for our beneficiaries. The £10m capital distribution announced last year was paid to our beneficiaries in April 2017, and together with the income distribution has enabled the schools, The Dulwich Almshouse Charity, and the Chapel to deliver greater charitable impact for young and old, increasing the numbers of means-tested bursaries, widening educational opportunities, improving student facilities and providing invaluable services. As well as supporting our beneficiaries, I am committed to enhancing Dulwich as a thriving, attractive neighbourhood. The Scheme of Management helps to maintain the distinctive character of the area, with its array of well-maintained housing and wonderful green spaces to enjoy. During the past year two much-loved flagship pubs have reopened following extensive refurbishment: The Crown and Greyhound in Dulwich and The Half Moon in Herne Hill, which has won two industry accolades for quality and service, including Greater London Pub of the Year 2018. On the former Dairy Site at Croxted Road, we have completed a new development which provides a state-of-the-art health centre, pharmacy, flats and shops. We believe these will bring a significant boost to the community at West Dulwich. The renovation of two shops in Dulwich Village, as part of our ongoing investment in the area, will improve the local food offering, and we are pleased to welcome as a first step, the independent butcher The Proud Sow. Further investment is planned across the Estate. The Board remains committed to supporting The Dulwich Almshouse Charity to secure a new almshouse on a suitable site, providing valuable sheltered housing for the elderly in need in our community. Our achievements are made possible by the Estate’s able and hardworking staff. I would particularly like to thank John Major, our outgoing Chief Executive who retired after 19 years of dedicated service to the Estate. In January we welcomed Simone Crofton who brings a wealth of skills in place-making and charity leadership from her previous roles, including that of Chief Executive of The Borough Market Trust. I would like to express my thanks also to Michael Maunsell who stepped down as a Trustee and to Patricia Cox who joined the Board during the year. We look forward to celebrating in 2019 our 400th anniversary. We are excited about the future, about the real difference we can make both to the area and to our beneficiaries, and the opportunities ahead to build on the legacy of our founder, Edward Alleyn. Nicola Meredith, Chairman of Trustees
The Dulwich Estate Annual Report 2018 5 Chief Executive’s foreword
I’m delighted to have joined an organisation which has helped make Dulwich and the surrounding areas, an idyll for lovers of the great outdoors, in addition to one of the most sought-after residential areas of London. At the same time, The Dulwich Estate has delivered on its founding principles of supporting educational opportunity, sheltered homes for the elderly and a community chapel of historic interest. I want to build on this legacy, through broad and deep partnerships. Working together, we can continue our vital support for young and old, while bringing our outstanding facilities, diverse high streets and amazing local history to as wide an audience as possible. We are lucky to be home to a vibrant mix of independent traders with active trade associations, providing strong retail offers, thriving local economies and a real community backbone. This year we worked with the newly formed Dulwich traders’ association. I look forward to supporting their efforts by bringing in the best independent and popular shops, cafes and retailers across the Estate, and inspiring visitors and residents alike with a distinct experience. Dulwich is an area of outstanding beauty. It is home to more than 40 acres of allotments, 69 acres of ancient woodland, 12 playing fields. The area exceeds Southwark’s natural greenspace standard threefold – and this is reflected in high satisfaction ratings in residents’ surveys. Our partnership with the London Wildlife Trust helps manage the largest remaining areas of ancient woodland in London, which includes Sydenham Hill Wood and Dulwich Wood. This work protects wildlife and trees but also increases access to the woodland for visitors, through guided walks. We can achieve more of these combined objectives in the year ahead. I look forward to enabling our beneficiaries to continue providing outstanding educational and housing support at each end of the generational spectrum. Together they provide hundreds of means-tested bursaries, educational programmes, housing help for those most in need, and a hub of historic and religious interest. Our job is to enable life opportunities and create exceptional spaces, suited to the way we live today while building for the future. It’s an exciting time in our evolution. Simone Crofton, Chief Executive
6 The Dulwich Estate Annual Report 2018 Trustees, executives and advisers
Trustees Those who served during the period as members of the Board of the incorporated Trustees of The Dulwich Estate were:
Trustee Nominated by Chairman Nicola Meredith, BA (Hons), FCCA The Governors of James Allen’s Girls’ School
Deputy Chairman Dr Andreas Köttering, DPhil, MSc, BSc The Governors of Dulwich College
Chairman of the Chapel Committee Roger Westbrook, CMG, MA Archbishop of Canterbury
P Martin Bagley, BA (Hons) Co-optative Iain Barbour, BSc (Hons), ACIB (to 1.4.2017) The Governors of Alleyn’s School Dr Irene Bishop, CBE, BEd, MA, LLD The Governors of Dulwich College Patricia Cox, BEM, LLB (from 1.8.2017) The Dulwich Almshouse Charity John Cruse, BSc (Hons) The Central Foundation Schools of London Catherine Jeffrey, MA, MA Co-optative Michael Maunsell, MA, LLB (to 31.7.2017) The Dulwich Almshouse Charity David Miller, MA The Governors of James Allen’s Girls’ School Richard Pinckard, BSc (Econ), FCA The Governors of Alleyn’s School Sarah Slater, BSc (Hons), MRICS Co-optative Simon Taylor, FRICS The President of the Royal Institution of Chartered Surveyors J Russell Vaizey, MA, FCA St Olave’s & St Saviour’s Schools Foundation Peter Yetzes, BA, JP (from 2.4.2017) The Governors of Alleyn’s School
Executives Chief Executive Simone Crofton (from 15.01.2018) John Major, FCA (to 14.01.2018) Director of Property Adrian Brace, MRICS Director of Finance Howard Bratter, MA, CPA, CGMA Principal Building Surveyor Simon Hoare, MRICS
Principal professional advisers Statutory auditor Kingston Smith LLP, Devonshire House, 60 Goswell Road, London, EC1M 7AD Bankers Barclays Bank Plc, 1 Churchill Place, Canary Wharf, London, E14 5HP Investment managers Sarasin & Partners LLP, 100 St Paul’s Churchyard, London, EC4M 8BU Legal advisers Charles Russell Speechlys LLP, 5 Fleet Place, London, EC4M 7RD Property consultants Daniel Watney LLP, 165 Fleet Street, London, EC4A 2DW Registered charity number 312751 Contact The Old College, Gallery Road, London SE21 7AE Tel: 020 8299 1000 Fax: 020 8693 2456 E‑mail: [email protected] www.thedulwichestate.org.uk
The Dulwich Estate Annual Report 2018 7 Property development
The Dulwich Estate’s income comes from its investment property portfolio and other income generating sources. We would not be able to fund our charitable objectives without keeping a close eye on these assets. The largest income contribution continues to come from our portfolio of commercial and residential property. The property income is derived from a variety of uses: industrial (9%), retail and leisure (43%), educational (8%), residential (39%), and other miscellaneous uses including garages and allotments (1%). We seek to retain and secure long-term income from our portfolio and have supported new, expanding or relocating businesses by offering them attractive, flexible lease terms to contribute to the local economy. This has not been easy with market uncertainty following the Brexit vote in June 2016 and the business rates revaluation that came into effect in April 2017. Occupation of our retail premises remains strong with businesses generally keen to commit to new leases. When a unit becomes vacant we target specific retailers to complement the existing retail mix in each of our commercial parades. Our aim is to enhance customer choice and to create an exciting, high quality, sought after retail offer. This can result in longer void periods and in these instances we may introduce a “pop up” tenant into the shop, which adds vibrancy and interest to our retail areas. This year we will work closely with the traders associations in Dulwich, West Dulwich and Herne Hill. We will continue to build positive relationships with our tenants and residents, discussing with them the issues that impact them and the fabric of the Estate. We are working hard to ensure good engagement with different interest groups and residents’ associations, through a variety of measures. This includes better communications, to improve the information we provide and encourage the opportunity to be involved. Throughout the year we carried out a planned maintenance programme across the portfolio, and brought back several vacant/dilapidated properties into use. We will continue to review the portfolio and plan further developments, delivering quality and improvements for the benefit of all. Adrian Brace, Director of Property
8 The Dulwich Estate Annual Report 2018 Property maintenance
We have a small dedicated team of building surveyors working at the Estate. This includes three chartered building surveyors and a further three members of the team who are working towards qualification, as part of the Estate’s trainee programme. Together we ensure our property is maintained to a good standard and operate a five-year cyclical programme to look after buildings, gardens and common amenities. Where possible, and working closely with a range of professional advisers, we upgrade our residential rented and commercial properties between tenancies, to provide units that meet customers’ requirements and to comply with the latest standards and regulations. This year approximately 20% of the entire residential rented portfolio has undergone some form of refurbishment or redecoration. Liaison with residents’ associations is really important for us, particularly on the 1960s residential leasehold estates. They are essential to formulating future maintenance plans and to assisting with the implementation of the programme of works. For example, eight tower blocks have the original lifts which now require modernisation. This is a large programme of work with implications for access and health and safety, and we are committed to working with residents to carry out the work to a high standard with minimum possible disruption. Simon Hoare, Principal Building Surveyor
The Dulwich Estate Annual Report 2018 9 A word from our beneficiaries…
We provide funding to seven schools, a local almshouse and a community chapel.
At JAGS we strive to make a positive contribution to our community and to do this “we need to ensure that our pupils come from all walks of life. The income we receive from The Dulwich Estate allows us to do just that and I was immensely proud that we were able to offer financial support to a fifth of the girls who joined us this year, the equivalent of a whole class. We have a long history of using every penny of our regular annual gift from the Estate to provide means tested bursaries for those who could not afford to send their daughters here otherwise. This means that, far from being an elitist school, our diversity is deep rooted and we are a community that truly represents the cultural and social diversity of our south London neighbourhood. Parents who have received full bursaries this year include those earning the living wage, on zero hours contracts and unable to work through disability so the money from The Dulwich Estate really does make a difference to the lives of these families. But it is not just the individuals who benefit from this; we teach all our girls to play an Sally-Anne Huang active role in society and an understanding of the cultures in the world around them is vital to being able to make a difference to others. Headmistress, JAGS ”
“Thanks to the income from The Dulwich Estate we are able to support our valued diversity - we are diverse in our social mix, breadth of talents, character and backgrounds, and all the stronger for that.” Dr Joe Spence
One of our principal aims at Dulwich College is to nurture a diverse and outward-looking “community that encourages a sense of social responsibility. Our ability to achieve this is dependent on essential partnerships and the different roles they play: the enthusiastic engagement of pupils and their parents; the expertise of staff; the active participation of Old Alleynians; the generosity of benefactors; and, significantly, the annual income distribution from The Dulwich Estate. In 2017-18 means-tested Dulwich College bursaries were awarded to 175 boys and their families, of which 126 awards were for between 75% and 100% of school fees. The income distribution of the Estate is used exclusively for bursaries and is forecast to fund 152 (87%) of all College bursaries this year. The achievements – academic, in the fields of art, drama, sport and music, and in their careers - of Alleynians who received and are currently in receipt of financial assistance is heartening and inspiring. It is often observed that only after having enjoyed an excellent education at school or university is it fully appreciated; but it would also be true to say that witnessing boys consciously making the most of every opportunity is to the benefit of the entire community. We all win. Dr Joe Spence Thanks to the income from The Dulwich Estate we are able to support our valued diversity. We are Master, Dulwich College diverse in our social mix, breadth of talents, character and backgrounds, and all the stronger for that. ”
10 The Dulwich Estate Annual Report 2018 St Olave’s and St Saviour’s Foundation supports two schools and young people “in Southwark with their education. The schools are local authority maintained. With support from The Dulwich Estate, the Foundation contributes 5% to each schools’ overall budgets. This goes towards teaching and pastoral staff and supports a variety of educational opportunities. At St Saviour’s school, following the London Bridge terrorist attack, funding was used to pay for new gates and to make a secure entrance. The pastoral team has been maintained to help girls facing a multitude of issues from being made homeless to those in hospital for mental health issues, basic uniform such as shoes and ensuring the school can open later after school, over some holidays and weekends to provide a safe space for students to go to when home lives are chaotic. At St Olave’s school, funding has been focussed on repairing roofs and refurbishing classrooms. A focus at the moment is on maintaining student numbers, but reducing class sizes as far as possible particularly for key stage 4 to help maintain and improve Russell Walters the student learning experience. ” Chief Executive, St Olave’s and St Saviour’s Central Schools Foundation
Our foundation uses funds from The Dulwich Estate to support a wide range of initiatives “across the two state schools which have helped us deliver high quality education to all our students. We achieved a 2017 progress score in the top three per cent of all schools nationally, and in English in the top one per cent. Recruiting high calibre subject staff is vital. The Dulwich Estate has supported a two-year training programme for a Schools Direct salaried candidate and successfully recruited humanities, English and MFL teachers. We were also able to provide amazing wrap-around services for students with the help of The Dulwich Estate. This included the provision of learning mentors who inspire students to achieve, a school-based counselling service and the HumanUtopia programme which helps build resilience. Additionally our learning lounge provides tutored learning to English, maths and science students. Together this provides rounded academic, emotional, social and motivational support across the school. We truly value the support our Trustees at the Estate have afforded us. It has created opportunities and experiences that develop and shape the lives of the students we serve. John Clark ” Clerk, Central Foundation Schools of London
At Alleyn’s we are proud of our origins as part of Edward Alleyn’s College of God’s Gift and “of our time as a direct grant grammar school. Both these influences inform our contemporary philosophy, and everyone at Alleyn’s feels a passionate commitment to making our school accessible to boys and girls who will flourish here, regardless of their family’s means. We have been striving to develop our bursary programme, with the happy result that we have doubled the number of means-tested bursary places that we offer over recent years. Currently, we support around 90 children with a significant proportion of their fees. The average extent of means-tested support at Alleyn’s is currently 90% of the fees. Much of this important work is only possible thanks to The Dulwich Estate, whose annual income distribution provides means-tested support for our pupils, many of whom join us from diverse backgrounds in South East London and whose families have sometimes faced very significant challenges. I am really proud of this work and the difference it is making. Our longer-term ambition is to once again double the number of means-tested bursary places available at Alleyn’s. We are immensely grateful for The Dulwich Estate’s continued support, which Dr Gary Savage will help us to remain a school rooted in our local area and able to offer opportunities to children from a wide range of backgrounds. Everyone in our community benefits from such efforts; as we Headmaster, Alleyn’s School work together to help our boys and girls to make their way, and to make a difference, in an ever- changing and diverse world. ”
The Dulwich Estate Annual Report 2018 11 The focus of the Dulwich Almshouse Charity’s activities continues to “be the operation of our almshouse in Dulwich. We currently support 14 residents, who range in age from 72 to 102 years old, to live independently, through the provision of quality, affordable, warden-assisted housing. The funding we receive from The Dulwich Estate ensures that the weekly maintenance contribution paid by our residents remains affordable and is no greater than the Housing and Social Security Benefit. Over the year residents and members of our ‘befrienders’ group (whose members are older people living near the almshouse) have enjoyed the regular social activities and outings organised by our warden, including Chi Kung exercise classes and a spring outing to a garden centre in Kent. They have also had the pleasure of attending several external events, such as the Dulwich Foundation School’s concert in February, and a series of ‘meet the author’ evenings held by Village Books. Our residents and befriender members value Catrin Prys Waugh the chance to attend such community events, and we are grateful to the local schools and businesses that offer us these opportunities. Chair of Trustees, The Dulwich Almshouse Charity We have also continued to provide small grants to support the work of other charities that share our aims of supporting older people in our area of benefit. In 2017/2018 these were; DeafBlind UK, Link Age Southwark, Camberwell Consolidated Charities, Southwark Pensioners Centre, St Luke’s Parochial Trust, St Christopher’s Hospice, Lucy Brown House, and the Bishopsgate Foundation. Looking ahead, we remain committed to our long-standing goal of building a new, fit for purpose almshouse to replace the existing one. We will continue to search for a suitable site for this in 2018/2019, in partnership with The Dulwich Estate. ”
“The funding we receive from The Dulwich Estate ensures that the weekly maintenance contribution paid by our residents remains affordable.” Catrin Prys Waugh
Christ’s Chapel has been a focal point of Dulwich life now for over 400“ years. This is solely down to the contributions it receives towards the upkeep and repair of the building from the Estate. Weekly Sunday services take place throughout the year, in addition to offering a sanctuary to celebrate the key markers of the lives of our community, be it through baptisms, weddings and funerals. It also plays host to music concerts and organ recitals open to the wider area celebrating talent and musical history. The Chapel plays an important part in the life of Alleyn’s, Dulwich College and JAGS during the school year, with joint services (Joint Evensongs, Remembrance Sunday, Founders Commemoration among others), leavers’ services, as well as some Sunday services led by the Dulwich College. It remains a vital and vibrant part of life of the whole community which is only made possible Revd John Watson by the diligent support of the Estate. Vicar, St Barnabas Dulwich and ” Christ’s Chapel and Foundation Chaplain
12 The Dulwich Estate Annual Report 2018 Central Foundation Girls’ School Students receive learning, resilience and mentoring programmes, supported by The Dulwich Estate
Photo courtesy of Vicky Matthers/iconphotomedia
The Dulwich Estate Annual Report 2018 13 Who we are
£7.75 MILLION 7 SCHOOLS supported by the distributed Estate, offering in 2017/18 outstanding education
means-tested student bursaries annually supported 336 at beneficiary schools
of allotments for community use 80 BUSINESSES supporting the local economy 5000 homes on the Estate
1,500 ACRES the size of the 1 Estate historic chapel for sheltered worship and accommodation community flats in our events 12playing fields for 16 Almshouse community use 14 The Dulwich Estate Annual Report 2018 2018 financial position and performance
The Board aims to manage its assets effectively to provide long term sustainable, growing distributions to its beneficiaries. The budgeted financial targets are scrutinised throughout the year and compared to actual outturn. This year, through the responsible stewardship of the Estate’s assets, we have been able to increase the income distribution to our beneficiaries by 11.4% to £7.75 million (2017: £6.96 million). The distribution division is determined by our charitable scheme. This enables our beneficiaries to deliver additional social impact through educational support, warden-assisted housing, and provision of a place for community worship and of historical interest for all.
Income distribution to beneficiaries
Christ’s Chapel of God’s Gift James Allen’s Girls’ School £30,000 £1,750,481 0.39%22.58% 22.58% the Dulwich26.02% Almshouse Charity Alleyn’s School £110,00035.68% 65.58 1.42%10.73% £7.75m £2,017,133 22.58% distributed to 26.02% 12.45 St Olave’s3.19% and St Saviour’s Central Schools26.02% Foundation beneficiaries 2.52 1.42% £247,24135.68% Dulwich College 65.58 19.44 3.19% 0.39%10.73% 12.45 3.19% £2,765,784 35.68% 2.52 the Central Schools Foundation 1.42% 19.44 £831,4710.39% 10.73%
Total income* Total expenditure* Investment income Property repairs, £2,269,948 investment and maintenance 19.44% £2,724,165 22.58% 10.36% 10.36 26.02% Tollgate Tollgate management 10.36 35.68% 1.11 £294,386 65.58 1.11 10.73% £167,562 22.13 2.52% 12.45 1.11% 22.13 3.19% £11.5m £11.2m2.52 66.40 66.40 1.42% Real estate income 19.44 Other operating costs 0.39% £8,881,066 £564,950 78.03% 22.13%
Distribution to beneficiaries £7,752,110 Period covered: 1 April 2017 – 31 March 2018 66.40% * Restricted fund only (see explanation under reserves policy on page 20)
The Dulwich Estate Annual Report 2018 15 10.36 1.11 22.13 66.40 16 The Dulwich Estate Annual Report 2018 Our history and background
Edward Alleyn, a successful actor-manager and Dulwich College, Alleyn’s School, Christ’s Chapel and entrepreneur, purchased the Manor of Dulwich Dulwich Picture Gallery. in 1605. Some years later he decided to create Provision was also made for payments for educational a charitable foundation in Dulwich, endowing it purposes to schools in the parishes of St Saviour’s, with his estate and other property. Christ’s Chapel St Botolph’s and St Luke’s in place of their right to of God’s Gift was the first of the buildings to be nominate pupils to the Foundation. The present completed, being consecrated on 1 September 1616. scheme continues that provision, by the annual Letters patent were granted by King James I, and payments that are made to St Olave’s & St Saviour’s on 21 June 1619 Alleyn’s College of God’s Gift was Schools Foundation and to the Central Foundation formally established. Schools of London. The original beneficiaries were twelve poor scholars, St Olave’s & St Saviour’s Schools Foundation dates six poor brothers and six poor sisters, all chosen back to 1561; the girls’ school of the foundation is from four parishes with which Alleyn was closely now located in New Kent Road, London, SE1, and associated: St Botolph’s Bishopsgate (where he was the boys’ school in Orpington, Kent. The Central born); St Saviour’s Southwark (where he had lived Foundation was formed in 1891 to administer and been Churchwarden); St Giles Cripplegate (where schools which had been founded earlier in the City of his Fortune Theatre was situated); and the parish London. The boys’ school is now located in Cowper of Camberwell, in which his Manor lay. In 1773 the Street, London, EC2, and the girls’ school in Bow new parish of St Luke’s took the place of St Giles as a Road, London, E3. nominating body. New buildings for Dulwich College were built James Allen, Warden and Master of the College of between 1866 and 1870 in College Road. James God’s Gift from 1712-1746, furthered the founder’s Allen’s Girls’ School was established on its present wishes to provide education. In 1741 he made over site in East Dulwich Grove in 1886 and Alleyn’s to the College six houses in Kensington, the rents School moved to its buildings in Townley Road of which were to be used in establishing two small in 1887. schools in Dulwich, one for boys and one for girls, the origin of James Allen’s Girls’ School. The current arrangements for the various charities of the Foundation were introduced by schemes In 1842 the College established a grammar school, approved by the Charity Commissioners on 31 July later named the Lower School, for the education of 1995. The Boards of Estates Governors and College 60 poor boys from Dulwich. The boys of the James Governors ceased to exist on that day. With effect Allen Foundation were transferred to the grammar from 1 August 1995 the functions of the Board of school and that foundation became responsible for Estates Governors were assumed by the Trustees the education of girls alone. of The Dulwich Estate (as regards the property and The Dulwich College Act of 1857 reconstituted investment and other activities of the Estate) and the foundation and in 1882 the charity was again by the Trustees of the Dulwich Almshouse Charity. re-organised. The Upper School became Dulwich All four of the parishes from which the original College and the Lower School became Alleyn’s beneficiaries were chosen retain formal connections School. Two Boards of Trustees were formed: with the Dulwich Almshouse Charity. The Trustees the Estates Governors with responsibility for of The Dulwich Estate also became Trustees of the managing the Estate’s property, investments and Charity of Christ’s Chapel of God’s Gift at Dulwich. the Eleemosynary branch (Edward Alleyn House Separate Boards of Governors also came into comprising 16 flats benefiting the elderly in need of existence for Dulwich College, JAGS and for housing); and the College Governors to administer Alleyn’s School.
The Dulwich Estate Annual Report 2018 17 Trustees’ report
Charity scheme and order The scheme made by order of the Charity Commission on 31 July 1995 regulates the charity. In June 1998 the Trustees of The Dulwich Estate became an incorporated body by a further order of the Charity Commission. This does not change the legal status of the charity or the liability of its Trustees, but is of particular advantage in the execution of legal documentation on behalf of the Board of Trustees.
Objects The Dulwich Estate is obliged to apply all its net income to its beneficiaries as set out in its Scheme. The Board continues to exercise its role to manage the endowment assets in the long-term interests of all the beneficiaries of the charity. Success in achieving this objective is measured in terms of the increase in the annual income distribution to the beneficiaries and maintaining the value of net assets in real terms.
Public benefit The Trustees have reviewed the Charity Commission’s guidance on the requirement to report on public benefit. The Board is satisfied that the charity provides, through its funding to the beneficiaries tangible public benefit to the community at large. This is: • Education– Alleyn’s School, Dulwich College, James Allen’s Girls’ School, St Olave’s & St Saviour’s Schools Foundation and The Central Foundation Schools of London • Relief to those in need - The Dulwich Almshouse Charity • A place in Dulwich for worship and community activities - Supporting Christ’s Chapel of God’s Gift at Dulwich The Scheme of Management is self-financing and non- charitable, but seeks to preserve, for those living within the boundaries of the Estate, the amenity for the common benefit. The Board meets bi-annually with its beneficiaries to discuss performance and review how the distributions from the charity have been spent.
18 The Dulwich Estate Annual Report 2018 Structure of the organisation All committees have terms of reference and authority as delegated by the Board. Committees and working groups The Dulwich Estate is governed by a Board of 14 Trustees – 11 report to the Board of Trustees at the earliest opportunity. appointed by nominating bodies and three co-optative members. Extraordinary meetings of the Board, committees and working Co-optative Trustees are appointed by the Board through parties are convened as necessary. selection criteria which seek to ensure a broad mix of skills The Chairman meets regularly with the Chief Executive to and representation from the local community. discuss matters of significance, the details of which are then Trustees ordinarily serve for five years and may then be circulated as appropriate to Trustees and discussed at meetings re-appointed for a second, continuous, term of five years. In of committees and the Board. exceptional cases, with a two thirds majority Trustees can vote The Scheme of Management Committee has authority, on to appoint a Trustee for a third consecutive term, of five years. behalf of the Board as the managers of the Estate’s Scheme of New Trustees are introduced to the operation of The Dulwich Management, to make decisions regarding applications made Estate and are made aware of the charity’s objects. All Trustees under the Scheme (which was established under the Leasehold are encouraged to attend relevant seminars and training courses Reform Act 1967 and the Leasehold Reform, Housing and Urban which are made available to the charity sector. Development Act 1993). The Committee meets monthly. The Nominations and Remuneration Committee comprising the As required under the Scheme of Management, there is an Chairman, the Deputy Chair and two Trustees is authorised to deal Advisory Committee whose membership comprises four with the appointment of new Trustees and all staff matters and Trustees of The Dulwich Estate and four representatives from other issues as delegated by the Board. Other ad hoc working The Dulwich Society, a local amenity society. This Committee groups are established from time to time, as appropriate. meets three times a year. Trustees are also appointed onto the external boards of some Responsibility for the day to day operation of the Estate is of the school beneficiaries, the Dulwich Almshouse Charity delegated by the Board to the Chief Executive and the senior and local parish bodies. The Trustees of the Estate are also management team. Trustees of Christ’s Chapel of God’s Gift at Dulwich.
Governance Beneficiary meetings Four ordinary meetings of the Board are held each year at which During the year, the Board met with beneficiaries to present a the matters considered include strategy, the budget for the forecast for income distributions and to discuss development forthcoming year, the half-year results, forecasts for the current projects. In December 2017, the annual meeting was held year and the final accounts and distribution to beneficiaries. between the Trustees and the Beneficiaries, for the Beneficiaries There are four meetings of the Finance Committee, which has to present how the income and capital distributions from the the principal function of considering, in detail, financial Estate had been applied in assisting their work and the public matters and then making recommendations to the Board. benefit derived from this. The Investment Committee meets four times a year with the Estate’s fund managers, in addition to an annual meeting with Annual View all Trustees. The Nominations and Remuneration Committee meets at least annually when it reviews staff performance and The Board continued the tradition of the Annual View. A lunch remuneration. The Property Committee meets four times a was held in September, hosted by St Olave’s and was preceeded by year with the Estate’s property advisers in attendance. The risk a tour of the School. Our thanks to all at St Olave’s for this event. management assessment working group meets on an ad hoc basis. The 400th Anniversary Committee was formed during the period to consider how the Estate should mark its quarter centenary in 2019.
The Dulwich Estate Annual Report 2018 19 Board of Trustees - responsibilities Risk management assessment The Board of Trustees is responsible for preparing the annual The Board reviews, annually, the register of risks to which the report and the financial statements in accordance with charity is exposed. The Board is satisfied that the procedures applicable law and United Kingdom Accounting Standards and controls currently in place are sufficient to mitigate the (United Kingdom Generally Accepted Accounting Practice). perceived risks to an acceptable level, recognising that claims in respect of trees, private roads and footpaths are a possibility, Charity law requires the Trustees to prepare financial given the extent of the charity’s property holdings. statements for each financial year that give a true and fair view of the state of affairs of The Dulwich Estate and the group and The Trustees are committed to understanding and evaluating of the income and expenditure of the charity and the group for the risks affecting the Estate’s activities, how these may affect the year. In preparing those financial statements the Board of future performance and to taking prudent steps to mitigate such Trustees is required to: risks. Key risks facing the Estate are considered on a regular basis by the Board. There are certain events that may impact the - select suitable accounting policies and then apply them ability of the Estate to sustain distributions to its beneficiaries consistently; at levels consistent with prior periods. Risks considered include - observe the methods and principles in the Charities a change in the outlook for certain sectors of the global Statement of Recommended Practice (SORP); economy (including the local Dulwich economy) negatively affecting performance of the property investment portfolio; a - make judgements and estimates that are reasonable and failure to maintain the real estate investments to the requisite prudent; standard; a change in the charitable status of the Estate, and a - state whether applicable UK Accounting Standards have been significant escalation in the Estate’s costs at a rate exceeding any followed, subject to any material departures disclosed and commensurate growth in income. explained in the financial statements; - prepare the financial statements on the going concern basis Reserves policy unless it is inappropriate to presume that the charity will continue in business. The Scheme made by Order of the Charity Commission on 31 July 1995, which regulates the charity, stipulates that it The Trustees are responsible for keeping proper accounting must distribute the balance of its income after the deduction of records that are sufficient to show and explain the charity’s management expenses and the costs of maintaining, repairing transactions and disclose with reasonable accuracy at any time, and insuring its property to its beneficiaries. As the application the financial position of the charity and enable it to ensure that of this income is fixed under the Scheme, these funds are the financial statements comply with the Charities Act 2011 classified as restricted funds. Under clause 3 (2) of the Scheme and regulations made thereunder and the trust deed. They the charity may only set aside funds from the Restricted Fund are also responsible for safeguarding the assets of the charity to meet the future costs of managing, maintaining, developing and hence for taking reasonable steps for the prevention and and improving land belonging to the charity and therefore it detection of fraud and other irregularities. has no free reserves (as defined by the Charity Commission) at The Trustees are responsible for the maintenance and the balance sheet date. The balance on the Restricted Fund at integrity of the financial information included on the charity’s 31 March 2018 was £435k (2017: £560k) and represents the website. Legislation in the United Kingdom governing the FRS102 pension asset less the accumulated loss of the charity’s preparation and dissemination of the financial statements and subsidiary 102 Alleyn Road Ltd, neither of which are presently other information included in annual reports may differ from available for distribution to the beneficiaries. legislation in other jurisdictions. The Board has established, by way of transfer over the years The Board of Trustees confirms its acceptance of these from the Restricted Fund, Designated Funds to meet its responsibilities. obligations and in particular, those to maintain and develop the Charity’s property assets. The details of these Funds are fully described in note 14 to the Financial Statements. At the year end, these totalled £1.603 million (2017: £1.853 million). Total Funds also include Permanent Endowment Funds of £311.821 million (2017: £305.633 million) of which £75.740 million (2017: £79.121 million) is held in readily realisable listed investments. In addition, the charity maintains cash balances of at least £1.5 million in order to manage operating cash flow requirements. This is in addition to the cash necessary for the payment of distributions to beneficiaries throughout the year.
20 The Dulwich Estate Annual Report 2018 Income and return on stock investments Connected charities Management of the charity’s stock market investments The Trustees of The Dulwich Estate are also Trustees of is delegated to its appointed Fund Managers on a full Christ’s Chapel of God’s Gift at Dulwich. Some members of discretionary basis, with the objective to exceed the benchmark the Board are Board members of the beneficiary schools; two by 1% per annum over rolling 3 year periods. The benchmark members of The Dulwich Estate Board also serve as Trustees of is a weighted index of two broad global equity measurements The Dulwich Almshouse Charity. The Dulwich Estate provides (60% MSCI All Countries World Daily - Net Total Return and management and administrative services to the Chapel and 40% MSCI AC World - Local Currency Q). The Board agrees in DAC, the details of which are provided in note 17 to the advance with the Fund Managers an annual target for income. Financial Statements. The actual income generated on the portfolio during the year exceeded that budgeted (£2.26 million vs £2.10 million). The market value of the portfolio at the year- end was £75.7 Looking forward million (£79.1 million at 31 March 2017) and the return on Entering our 400th year, we look forward, through our the portfolio, net of fees. was 3.7% against the benchmark school beneficiaries, to broadening opportunity for students return of 5.9% (2017: actual 21.0%, benchmark 26.1%). through a range of measures. These include means-tested bursaries, school help for those in financial hardship and extra-curricular support. Income on real estate We will continue to manage our property and investment With the exception of residential properties subject to portfolio for strong performance while at the same time regulated tenancies, the Charity’s properties are let to tenants delivering a high quality, well-designed and managed at rental levels established by reference to the open market for commercial and residential offer for all. similar properties. The Estate takes the advice of its consultant surveyors and letting agents in agreeing rents. It is the policy Our place-making plans will ensure vibrant and exciting high of the Board to maintain its properties in a state of good repair streets to eat, drink, shop and spend time. By bringing in the best in order to seek to maximise rental income. Total Real Estate in class independent shops, cafes and retailers across the Estate Income was £8.880 million (£7.950 million at 31 March 2017). we will continue to provide visitors and residents alike with an Rents on residential lettings were up by 5.6% to £3.279 million enjoyable and sought after experience. We will maintain and (2017: £3.106 million) and commercial lettings were up 15.8% widen access to our areas of outstanding beauty. to £5.551 million (2017: £4.795 million). Working together with the Dulwich Almshouse Charity, we will support their search and delivery of new premises which can realise modern, fit-for-purpose accommodation for elderly Alleyn Road 102 Limited residents most in need. This non‑charitable trading subsidiary was established to We look forward to developing partnerships more widely and redevelop (with a development partner) a property at 102 working with the full range of organisations who live work and Alleyn Road. The company’s financial results are shown in visit Dulwich. This includes residents, traders’ associations, local note 10 (b) i) to the Financial Statements and have also been Government, businesses and schools. consolidated with those of the charity where indicated. In 2019, our 400th anniversary plans will allow us to bring to life our rich history. We look forward to celebrating this legacy Dulwich Estate Services Limited with all. This non-charitable trading subsidiary produced a profit for the year which will be Gift Aided to The Dulwich Estate and The final report is approved by the Board of Trustees of The Dulwich a summary of the company’s financial results is given in note Estate on 7 July 2018 and signed on its behalf by: 10 (b) ii) to the Financial Statements. Its results have not been consolidated on the basis of materiality.
The Scheme of Management Nicola Meredith, Chairman The charity’s Scheme of Management continues to be applied in line with its stated objective: to preserve the amenities of the Estate for the common benefit. Thanks to those Trustees who give their time to meet monthly to review applications for alterations to properties or works to trees, which are referred to the committee for decision.
The Dulwich Estate Annual Report 2018 21 2017-2018 year in review
Organisations we have worked with this year...
charitable beneficiaries - 7 working to support young and old residents’ associations – working with the Estate on 34 residents issues
independent traders’ associations - 3 promoting the local economy sports facilities – 8 available for community use community organisations – protecting the environment, 4 creating better places
WORKING TOGETHER
22 The Dulwich Estate Annual Report 2018 Developments completed this year...
pub hotels including national 2 award-winning The Half Moon shops refurbished 7 or created new health 1 centre
IMPROVING PLACES PROVIDING SERVICES
Advisory and building services delivered...
of all properties 20% redecorated or refurbished
Scheme of Management 200+ development applications tree works 400+ approved architectural and tree 800+ advice sessions provided
The Dulwich Estate Annual Report 2018 23 Auditor’s report
Opinion or We have audited the financial statements of The Dulwich • the Trustees have not disclosed in the financial statements Estate for the year ended 31 March 2018 which comprise any identified material uncertainties that may cast significant the Group Statement of Financial Activities, the Group doubt about the group’s and parent charity’s ability to and Parent Charity Balance Sheets, the Group Cash Flow continue to adopt the going concern basis of accounting for Statement and notes to the financial statements, including a period of at least twelve months from the date when the a summary of significant accounting policies. The financial financial statements are authorised for issue. reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards Other information (United Kingdom Generally Accepted Accounting Practice) including FRS 102 ‘The Financial Reporting Standard Applicable The other information comprises the information included in in the UK and Ireland’. the annual report, other than the financial statements and our
auditor’s report thereon. The Trustees are responsible for the In our opinion the financial statements: other information. Our opinion on the financial statements • giv e a true and fair view of the state of the group’s and the does not cover the other information and, except to the extent parent charity’s affairs as at 31 March 2018 and of the group’s otherwise explicitly stated in our report, we do not express any incoming resources and application of resources, including its form of assurance conclusion thereon. income and expenditure, for the year then ended; In connection with our audit of the financial statements, our • have been properly prepared in accordance with United responsibility is to read the other information and, in doing so, Kingdom Generally Accepted Accounting Practice; and consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in • have been prepared in accordance with the requirements of the audit or otherwise appears to be materially misstated. If the Charities Act 2011. we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material Basis for opinion misstatement of the other information. If, based on the work we We conducted our audit in accordance with International have performed, we conclude that there is a material misstatement Standards on Auditing (UK) (ISAs(UK)) and applicable law. Our of this other information, we are required to report that fact. responsibilities under those standards are further described in We have nothing to report in this regard. the Auditor’s Responsibilities for the audit of financial statements Matters on which we are required to report by exception section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to We have nothing to report in respect of the following matters our audit of the financial statements in the UK, including the where the Charities Act 2011 require us to report to you if, in FRC’s Ethical Standard, and we have fulfilled our other ethical our opinion: responsibilities in accordance with these requirements. We • the information given in the Trustee’s Annual Report is believe that the audit evidence we have obtained is sufficient inconsistent in any material respect with the financial and appropriate to provide a basis for our opinion. statements; or
Conclusions relating to going concern • the parent charity has not kept adequate accounting records, or We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you • the parent charity’s financial statements are not in agreement where: with the accounting records; or • the Trustees’ use of the going concern basis of accounting in • we have not received all the information and explanations we the preparation of the financial statements is not appropriate; require for our audit.
24 The Dulwich Estate Annual Report 2018 Responsibilities of Trustees • Conclude on the appropriateness of the Trustees’ use of the going concern basis of accounting and, based on the audit As explained more fully in the Trustees’ responsibilities evidence obtained, whether a material uncertainty exits statement, the Trustees are responsible for the preparation of related to events or conditions that may cast significant the financial statements and for being satisfied that they give a doubt on the group and parent charity’s ability to continue as true and fair view, and for such internal control as the Trustees a going concern. If we conclude that a material uncertainty determine is necessary to enable the preparation of financial exists, we are required to draw attention in our auditor’s statements that are free from material misstatement, whether report to the related disclosures in the financial statements due to fraud or error. or, if such disclosures are inadequate to modify our opinion. In preparing the financial statements, the Trustees are responsible Our conclusions are based on the audit evidence obtained up for assessing the group and parent charity’s ability to continue as to the date of our auditor’s report. However, future events or a going concern, disclosing, as applicable, matters related to going conditions may cause the group or parent charity to cease to concern and using the going concern basis of accounting unless continue as a going concern. the Trustees either intend to liquidate the group or parent charity • E valuate the overall presentation, structure and content of the or to cease operations, or have no realistic alternative but to do so. financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Auditor’s responsibilities for the audit of the financial statements • Obtain sufficient appropriate audit evidence regarding the We have been appointed as auditor under section 144 of the financial information of the entities or business activities Charities Act 2011 and report in accordance with regulations within the group to express an opinion on the consolidated made under section 154 of that Act. financial statements. We are responsible for the direction, Our objectives are to obtain reasonable assurance about supervision and performance of the group audit. We remain whether the financial statements as a whole are free from solely responsible for our audit report. material misstatement, whether due to fraud or error, and to We communicate with those charged with governance issue an auditor’s report that includes our opinion. Reasonable regarding, among other matters, the planned scope and assurance is a high level of assurance, but is not a guarantee timing of the audit and significant audit findings, including that an audit conducted in accordance with ISAs (UK) any significant deficiencies in internal control that we identify will always detect a material misstatement when it exists. during our audit. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken Use of our report on the basis of these financial statements. This report is made solely to the charity’s Trustees, as a body, in As part of an audit in accordance with ISAs (UK) we exercise accordance with Chapter 3 of Part 8 of the Charities Act 2011. professional judgement and maintain professional scepticism Our audit work has been undertaken so that we might state to throughout the audit. We also: the charity’s Trustees those matters we are required to state • Identify and assess the risks of material misstatement of the to them in an auditor’s report and for no other purpose. To the financial statements, whether due to fraud or error, design fullest extent permitted by law, we do not accept or assume and perform audit procedures responsive to those risks, and responsibility to any party other than the charity and charity’s obtain audit evidence that is sufficient and appropriate to Trustees as a body, for our audit work, for this report, or for the provide a basis for our opinion. The risk of not detecting a opinion we have formed. material misstatement resulting from fraud is higher than
for one resulting from error, as fraud may involve collusion, KINGSTON SMITH LLP forgery, intentional omissions, misrepresentations, or the for and on behalf of Kingston Smith LLP, Statutory Auditor override of internal control. Devonshire House • Obtain an understanding of internal control relevant to the 60 Goswell Road audit in order to design audit procedures that are appropriate London in the circumstances, but not for the purposes of expressing EC1M 7AD an opinion on the effectiveness of the group and parent 7 July 2018 charity’s internal control. Kingston Smith LLP is eligible to act as auditor in terms of Section • Evaluate the appropriateness of accounting policies used 1212 of the Companies Act 2006. and the reasonableness of accounting estimates and related disclosures made by the Trustees.
The Dulwich Estate Annual Report 2018 25 The Dulwich Estate Consolidated Statement Of Financial Activities Year Ended 31 March 2018
2018 2018 2018 2018 2017 Restricted Designated Endowment Total Total Note Fund Funds Funds Funds Funds £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s INCOME Investment income Real estate income 2 8,880 - - 8,880 7,950 Tollgate receipts 3 294 - - 294 241 Dividend and interest income 4 2,271 - - 2,271 2,303 TOTAL INCOME 11,445 - - 11,445 10,494
EXPENDITURE ON: Raising funds Real estate maintenance expenditure 6 2,724 861 - 3,585 2,911 The Scheme of Management 7 47 - - 47 52 Tollgate expenses 3 168 - - 168 160 Investment management fees 6 386 - - 386 394
Charitable activities Income Distribution to Beneficiaries 16(a) 7,752 - - 7,752 6,959 Capital Distribution to Beneficiaries 16(b) - - - - 10,000 Governance costs 6 132 - - 132 85
TOTAL EXPENDITURE 11,209 861 - 12,070 20,561
Net income/(expenditure) before transfers 236 (861) - (625) (10,067) and investment gains
Net gain on investments 10 - - 619 619 12,807
Realised gains on properties 8 - - 917 917 2,660 Unrealised gains on revaluation of freehold properties 8 - - 4,668 4,668 9,421 Net income/(expenditure) 236 (861) 6,204 5,579 14,821
Transfers between funds 14 (595) 611 (16) - -
Net income/(expenditure) after transfers (359) (250) 6,188 5,579 14,821
Other recognised gains and losses Actuarial gain on pension scheme 18 234 - - 234 13
NET MOVEMENT IN FUNDS (125) (250) 6,188 5,813 14,834
Funds brought forward at 1 April 2017 560 1,853 305,633 308,046 293,212
FUNDS CARRIED FORWARD AT 31 March 2018 14 435 1,603 311,821 313,859 308,046
All amounts relate to continuing operations. There are no gains or losses other than those stated above.
26 The Dulwich Estate Annual Report 2018 The Dulwich Estate Charity Statement Of Financial Activities Year Ended 31 March 2018
2018 2018 2018 2018 2017 Restricted Designated Endowment Total Total Note Fund Funds Funds Funds Funds £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s INCOME Investment income Real estate income 2 8,880 - - 8,880 7,950 Tollgate receipts 3 294 - - 294 241 Dividend and interest income 4 2,396 - - 2,396 2,407 TOTAL INCOME 11,570 - - 11,570 10,598
EXPENDITURE ON: Raising funds Real estate maintenance expenditure 2,719 861 - 3,580 2,907 The Scheme of Management 7 47 - - 47 52 Tollgate expenses 3 168 - - 168 160 Investment management fees 6 386 - - 386 394 Charitable activities Income Distribution to Beneficiaries 16(a) 7,752 - - 7,752 6,959 Capital Distribution to Beneficiaries 16(b) - - - - 10,000 Governance costs 6 132 - - 132 85 TOTAL EXPENDITURE 11,204 861 - 12,065 20,557
Net income/(expenditure) before transfers 366 (861) - (495) (9,959) and investment gains
Net gain on investments 10 - - 619 619 12,807
Realised gains on properties 8 - - 917 917 2,660 Unrealised gains on revaluation of freehold properties 8 - - 4,668 4,668 9,421 Net income/(expenditure) 366 (861) 6,204 5,709 14,929
Transfers between funds 14 (595) 611 (16) - -
Net income/(expenditure) after transfers (229) (250) 6,188 5,709 14,929
Other recognised gains and losses Actuarial gain on pension scheme 18 234 - - 234 13
NET MOVEMENT IN FUNDS 5 (250) 6,188 5,943 14,942
Funds brought forward at 1 April 2017 925 1,853 305,633 308,411 293,469
FUNDS CARRIED FORWARD AT 31 March 2018 14 930 1,603 311,821 314,354 308,411
All amounts relate to continuing operations. There are no gains or losses other than those stated above.
The Dulwich Estate Annual Report 2018 27 The Dulwich Estate Consolidated Summary Income And Expenditure Account Year Ended 31 March 2018
2018 2017 Total Total Note Funds Funds £ 000’s £ 000’s
Total Income 11,445 10,494 Expenditure excluding distribution to Beneficiaries (4,318) (3,602)
Net income for the year before transfers 7,127 6,892
Net transfers from Reserves 625 67
Available for Distribution 16 7,752 6,959
The Consolidated Summary Income and Expenditure Account is derived from the Consolidated Statement of Financial Activities which, together with the notes to the accounts on pages 32-47, provide full information on the movements during the year on all the funds of the Charity.
28 The Dulwich Estate Annual Report 2018 The Dulwich Estate Consolidated Balance Sheet As At 31 March 2018
Note 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s FIXED ASSETS Real estate 8 237,667 228,383 Operational property 9 (a) 1,450 1,450 Other tangible assets 9 (b) 65 106 Intangible fixed assets 9 (b) 32 - Investments 10 75,740 79,121 314,954 309,060
CURRENT ASSETS Debtors 11 2,187 2,360 Money Market Funds 170 170 Cash at bank, on deposit and in hand 12 4,596 12,441 6,953 14,971
Creditors: amounts falling due within one year 13 (8,531) (16,588)
NET CURRENT (LIABILITIES) (1,578) (1,617)
Defined benefit pension scheme asset 18 483 603
NET ASSETS 313,859 308,046
FINANCED BY:
PERMANENT ENDOWMENT FUNDS 14 311,821 305,633
DESIGNATED FUNDS 14 1,603 1,853
RESTRICTED FUND 14 435 560
313,859 308,046
Approved by the Incorporated Board of Trustees on 7 July 2018 and signed on its behalf by: Signed: Nicola Meredith (Chairman)
Dr Andreas Köttering (Deputy Chairman)
Countersigned: S imone Crofton (Chief Executive)
The Dulwich Estate Annual Report 2018 29 The Dulwich Estate Charity Balance Sheet As At 31 March 2018
Note 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s FIXED ASSETS Real estate 8 234,815 225,906 Operational property 9 (a) 1,450 1,450 Other tangible assets 9 (b) 65 106 Intangible fixed assets 9 (b) 32 - Investments 10 75,740 79,121 312,102 306,583
CURRENT ASSETS Debtors 11 2,232 2,401 Money Market Funds 170 170 Cash at bank, on deposit and in hand 12 4,596 12,441 6,998 15,012
Creditors: amounts falling due within one year 13 (8,527) (16,585)
NET CURRENT (LIABILITIES) (1,529) (1,573)
Loan to Alleyn Road 102 Limited 10 (b) 3,298 2,798
Defined benefit pension scheme asset 18 483 603
NET ASSETS 314,354 308,411
FINANCED BY:
PERMANENT ENDOWMENT FUNDS 14 311,821 305,633
DESIGNATED FUNDS 14 1,603 1,853
RESTRICTED FUND 14 930 925
314,354 308,411
Approved by the Incorporated Board of Trustees on 7 July 2018 and signed on its behalf by: Signed: Nicola Meredith (Chairman)
Dr Andreas Köttering (Deputy Chairman)
Countersigned: S imone Crofton (Chief Executive)
30 The Dulwich Estate Annual Report 2018 The Dulwich Estate Consolidated Cash Flow Statement Year Ended 31 March 2018
Note 2018 2017 £ 000’s £ 000’s
RECONCILIATION OF NET EXPENDITURE TO NET CASH INFLOW FROM OPERATING ACTIVITIES
Net expenditure before transfers and investment gains (625) (10,067) Depreciation charge for year 9 56 50 Decrease / (increase) in debtors 99 (427) FRS102 pension fund adjustment 354 (103) (Decrease) / increase in creditors (10,827) 411 Investment income 4 (2,271) (2,303) Income distribution to Beneficiaries 16 (a) 7,752 6,959 Capital distribution to Beneficiaries 6 - 10,000
Net cash (outflow) / inflow from operating activities (5,462) 4,520
CASH FLOW STATEMENT
Net cash (outflow) / inflow from operating activities (5,462) 4,520 Income received on investments 20 (a) 2,347 2,292 Capital inflow 20 (b) 693 4,694
(2,422) 11,506 Income paid to Beneficiaries 16 (a) (4,983) (6,677) (Decrease)/increase in cash in the year (7,405) 4,829
RECONCILIATION OF NET CASHFLOW TO MOVEMENT IN NET FUNDS (Note 20 (c))
(Decrease)/increase in cash in the year (7,405) 4,829
Cash and liquid resources at 1 April 2017 13,145 8,316
Cash and liquid resources at 31 March 2018 5,740 13,145
The Dulwich Estate Annual Report 2018 31 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
1. Accounting policies b) Basis of consolidation a) Basis of accounting The Dulwich Estate is required to prepare consolidated financial statements in accordance with the Charities Act. These financial statements are prepared on a going concern These statements include the results of the Charity and its basis under the historical cost convention as modified subsidiary, Alleyn Road 102 Limited but exclude those of by the revaluation of certain fixed assets. The financial Dulwich Estate Services Limited (note 10(b)) on the basis statements are prepared in Sterling which is the functional of materiality. currency of the entity. Monetary amounts are rounded to the nearest pound. The results of Alleyn Road 102 Limited have been included in the Consolidated Statement of Financial Activities on a line The financial statements have been prepared in by line basis, in accordance with Financial Reporting Standard accordance with Accounting and Reporting by Charities: 2 Accounting for Subsidiary Undertakings. Intra group Statement of Recommended Practice applicable to transactions are eliminated on consolidation. charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2015) c) Freehold properties of the Estate - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland The property at Dulwich was conveyed to the Charity by a (FRS 102) and the Charities’ Act 2011. Deed of Grant dated 24 April 1620. The Incorporated Trustees have no Deed in their Custody or under their control relating The Dulwich Estate meets the definition of a public benefit to the freehold interest in the property and the private ways entity under FRS 102. The financial statements have been other than the Deed of Grant and Counterpart Leases. There is prepared under the historical cost convention as modified by no historic cost associated with the property and accordingly it the revaluation of freehold properties, operational property is not possible to present a statement of historical cost profits and investments (notes 8, 9(a) and 10(a) respectively) and in and losses. accordance with applicable accounting standards. Properties both on and off the Estate are considered to be investment assets and therefore they are not depreciated Going concern in accordance with FRS 102. It is the policy of the Board of Trustees to revalue approximately one-third of the Estate’s The Trustees have assessed whether the use of the going properties each year, and to capitalise improvements to concern basis is appropriate and have considered possible properties. Each year, the Board of Trustees reviews the events or conditions that might cast significant doubt on remaining properties and considers whether there has been the ability of the Charity to continue as a going concern. any permanent diminution in value requiring adjustment in The Trustees have made this assessment for a period of at the accounts. least one year from the date of approval of the financial statements. After making enquiries the Trustees have concluded that there is a reasonable expectation that the d) Fixed assets and depreciation Charity has adequate resources to continue in operational existence for the foreseeable future. The Charity therefore Fixed assets are included at cost and are depreciated as follows: continues to adopt the going concern basis in preparing its Motor Vehicles 25%, Furniture & Equipment (including that financial statements. for the Scheme of Management) 20%, Computer Equipment 33.33%, Tollgate Building & Equipment 20%. The rates of depreciation used, charged on original cost, are an estimate of the useful life of the assets. Generally, individual items costing under £500 are not capitalised but the cost is written off to repairs. The Old College, Dulwich, the Charity’s office
32 The Dulwich Estate Annual Report 2018 is considered to be an operational asset of the Charity and is h) Expenditure revalued every five years. No depreciation is provided on this Charitable activities represent amounts available for property (notes 8 & 9) and an annual impairment review distribution to beneficiaries. Governance costs consist mainly is undertaken. of staff costs and audit and accountancy fees. Costs of raising funds comprise (in accordance with the terms of the Charity’s Scheme) all expenditure directly related to maintaining the e) Intangible assets and amortisation Charity’s properties, the Tollgate, its investment portfolio and Intangible assets are recognised at cost less accumulated its share of the Scheme of Management Charge (note 7). amortisation and accumulated impairment losses. An analysis of Expenditure is detailed in note 6. Staff costs have Amortisation is recognised so as to write off the cost of been allocated across the activities based on an estimate of intangibles less their residual values over their estimated useful staff time. lives. The intangible assets are amortised at 33.33%, charged on original cost using the straight-line method. i) Permanent endowment funds These are the Property Valuation Fund, Capital Reinvestment f) Investments Fund and Sinking Funds together which comprise the Charity’s Investments are stated at market value in accordance with endowment capital. the Statement of Recommended Practice. The Statement of Financial Activities includes those unrealised gains and losses arising from the revaluation of the investment portfolio during j) Restricted and designated funds the year and does not distinguish between the valuation Designated Funds have been established by allocations adjustments relating to sales and those relating to continued from the Restricted Fund and are fully disclosed in note 14. holdings as they are together treated as changes in the value of The Board of Trustees reviews the amounts held in these the investment portfolio. Funds and where these are considered to be surplus to meet requirements, the balances are transferred back to the Restricted Fund. g) Income The Statement of Financial Activities is credited, on an accruals basis, with income from real estate, Tollgate receipts and with income earned from the investment of capital funds, and is charged with all expenses incidental to the maintenance and administration of the Estate. Rents are shown at the contracted level agreed and no account is taken of increases therein until renewal negotiations are completed. Rent free periods are accounted for in the period to which they apply.
The Dulwich Estate Annual Report 2018 33 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
2018 2017 £ 000’s £ 000’s 2 REAL ESTATE INCOME Rents from residential lettings 3,279 3,106 Rents from commercial lettings 5,551 4,795 Ground rents and wayleaves 28 28 Other income 22 21 8,880 7,950
3 TOLLGATE INCOME & EXPENDITURE Income 294 241 less: Depreciation (23) (26) Expenditure (145) (134) (168) (160) 126 81
Group Charity 4 INVESTMENT INCOME 2018 2017 2018 2017 Dividend income 2,262 2,294 2,262 2,294 Deposit interest & other income 9 9 134 113 2,271 2,303 2,396 2,407
5 STAFF COSTS Salaries 1,269 1,202 Social security costs 143 137 Pension costs 601 145 2,013 1,484
Staff costs for the Charity and the Group shown in note 6 are net of income arising on amounts recharged and include other staff related costs.
The average number of employees during the year was 27 (2017: 26).
The number of employees with gross emoluments over £60,000, including the value of benefits in kind, fell into the following bands:
2018 2017 No. No. £60,001 - £70,000 1 1 £70,001 - £80,000 1 1 £80,001 - £90,000 - 2 £90,001 - £100,000 3 1 £120,001 - £130,000 1 - £140,001 - £150,000 - 1
Two (2017: three) of the above employees were accruing benefits under the Defined Benefits Pension Scheme and four (2017: three) employees under the Defined Contribution Scheme (Note 18). The key management personnel of the Parent Charity and the Group, comprise the Trustees, the Chief Executive, the Director of Property, the Director of Finance, and the Principal Building Surveyor of The Dulwich Estate. The total employee benefits of the key management personnel of The Dulwich Estate were £577,768 (2017: £547,398).
34 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
6 GROUP EXPENDITURE Total Total Staff costs Direct costs Depreciation 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s Charitable activities Income Distribution to Beneficiaries - 7,752 - 7,752 6,959 Capital Distribution to Beneficiaries - - - - 10,000 - 7,752 - 7,752 16,959 Governance costs Staff costs 74 - - 74 55 Auditor’s fees - audit - 35 - 35 25 Auditor’s fees - other - 22 - 22 4 Office expenditure - 1 - 1 1 74 58 - 132 85
Raising funds Real estate maintenance expenditure 1,833 1,951 29 3,813 3,196 Less: rechargeable costs - (228) - (228) (285) 1,833 1,723 29 3,585 2,911 The Scheme of Management 72 (29) 4 47 52 Tollgate expenses 38 107 23 168 160 Investment management fees 28 358 - 386 394
Total cost of raising funds 1,971 2,159 56 4,186 3,517
Total expenditure 2,045 9,969 56 12,070 20,561
Real estate maintenance expenditure Restricted Designated 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s Staff costs 1,833 - 1,833 1,270 Residential Property Repairs Fund - 748 748 805 Commercial Property Repairs Fund - 54 54 47 Rented property, rates, insurance and services - irrecoverable expenditure 243 - 243 181 Alleyn Road 102 Limited expenditure 5 - 5 4 Roads and footpaths 17 - 17 18 Depreciation 29 - 29 20 Leasehold property expenditure 124 - 124 29 Estate Development Reserve - 49 49 174 Estate Office Repairs Fund - 10 10 - Other direct costs Architects’ and surveyors’ fees 208 - 208 227 Solicitors’ and consultants’ fees 200 - 200 154 Office expenditure 222 - 222 219 Other 71 - 71 48 2,952 861 3,813 3,196 Less: Management charge on property maintenance costs (163) - (163) (197) Administration charge on sale of Estate’s property (39) - (39) (58) Other fees (26) - (26) (30) 2,724 861 3,585 2,911
The Dulwich Estate Annual Report 2018 35 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s 7. THE SCHEME OF MANAGEMENT Amenity Expenditure 182 202 Basis of Apportionment costs pro rata 5 3 Estimated recovery (140) (153) 47 52 Basic Expenditure 221 238 Basis of Apportionment costs pro rata 6 3 Estimated recovery (227) (241) - - Net charge for the year to be borne by the Estate 47 52
Under the Scheme of Management, a Charge is payable annually by enfranchised owners towards certain costs incurred in the maintenance and administration of the Estate.
Group Charity 2018 2017 2018 2017 8. REAL ESTATE £ 000’s £ 000’s £ 000’s £ 000’s FREEHOLD PROPERTY ON THE DULWICH ESTATE At 1 April 2017 207,583 193,141 205,106 191,118 Property purchased and improved during year 5,542 9,741 5,167 9,287 Property sold during year (926) (1,920) (926) (1,920) 212,199 200,962 209,347 198,485 Surplus on revaluation 4,918 6,621 4,918 6,621 At 31 March 2018 217,117 207,583 214,265 205,106
COMMERCIAL PROPERTY OFF THE DULWICH ESTATE At 1 April 2017 20,800 18,350 20,800 18,350 Surplus on revaluation (250) 2,450 (250) 2,450 At 31 March 2018 20,550 20,800 20,550 20,800
SUMMARY OF REAL ESTATE At 1 April 2017 228,383 211,491 225,906 209,468 Add: cost of property purchased and improved during year 5,542 9,741 5,167 9,287 Less: book value of properties sold during year (926) (1,920) (926) (1,920) Net surplus on revaluation 4,668 9,071 4,668 9,071 TOTAL REAL ESTATE HOLDINGS at 31 March 2018 237,667 228,383 234,815 225,906
Tranche 1 properties were valued at 31 March 2018 by an external valuer, Daniel Watney LLP, Chartered Surveyors. The valuations were prepared in accordance with the requirements of the RICS Valuation Standards (6th Edition) and UK Generally Accepted Accounting Practices (UKGAAP) - FRS102. The properties have been valued on the basis of market value on the assumption they would be sold subject to existing leases/tenancies. For properties held for re-development the assumption has been these would be sold subject to the leases granted. The valuer’s opinion of market value was primarily derived using comparable recent market ransactions on arm’s length terms together with other valuation techniques. Properties are revalued every three years on a rolling cycle by Daniel Watney LLP. At 31 March 2018 the Charity had total capital commitments contracted but not provided for of £841,000 in relation to the development of the the former Dairy Site.
36 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
8. REAL ESTATE (continued) Group Charity FREEHOLD PROPERTY ON THE DULWICH ESTATE 2018 2017 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s At 31 March 2015 Tranche 1 - 67,602 - 67,602 At 31 March 2016 Tranche 2 115,904 103,813 115,904 103,814 At 31 March 2017 Tranche 3 13,322 26,881 10,470 24,403 At 31 March 2018 Tranche 1 82,723 - 82,723 - Additions at Cost 5,168 9,287 5,168 9,287 217,117 207,583 214,265 205,106
REALISED GAIN ON PROPERTIES 2018 2017 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s Capital Receipts and proceeds from properties sold in year 1,843 4,580 1,843 4,580 Book cost of properties sold in year (926) (1,920) (926) (1,920) Net realised gains on properties in year 917 2,660 917 2,660
9 (a) OPERATIONAL PROPERTY 2018 2017 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s The Old College, Dulwich At 1 April 2017 1,450 1,100 1,450 1,100 Revaluation in year - 350 - 350 At 31 March 2018 1,450 1,450 1,450 1,450
9 (b) THE GROUP AND CHARITY INTANGIBLE AND OTHER TANGIBLE FIXED ASSETS
Furniture Tollgate Scheme of Total and Computer Building & Management Total Intangible Equipment Equipment Equipment Equipment Tangible £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s Cost: At 1 April 2017 - 218 197 136 50 601 Additions in year 32 - 10 3 3 16 Disposals in year - (101) (3) - (9) (113) At 31 March 2018 32 117 204 139 44 504
Depreciation: At 1 April 2017 - 202 156 101 36 495 Charge for year - 7 22 23 4 56 Disposals in year - (101) (3) - (8) (112) At 31 March 2018 - 108 175 124 32 439
Net Book Value: At 31 March 2018 32 9 29 15 12 65
At 31 March 2017 - 16 41 35 14 106
The Dulwich Estate Annual Report 2018 37 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
2018 2017 10 (a) THE GROUP AND CHARITY INVESTMENTS £ 000’s £ 000’s Analysis of movement of investments Market value 1 April 78,587 75,696 Purchases 22,797 45,275 Sale proceeds (25,303) (58,647) Net proceeds of currency hedging contracts (1,934) 3,456 Net (loss)/gain on investments (1,315) 16,263 Net gain/(loss) on currency hedging contracts 1,934 (3,456) Market Value of investments at 31 March 74,766 78,587 Cash held in investment portfolio 974 534 Total investment portfolio value 75,740 79,121 Historical cost 61,279 58,550 Investments UK Equities 13,383 14,801 Foreign Exchange Contracts 77 166 Overseas Equities 61,306 63,620 Total investments 74,766 78,587 Cash held in investment portfolio 974 534 Total investment portfolio value 75,740 79,121
10 (b) INVESTMENT IN SUBSIDIARY UNDERTAKINGS 2018 2017 £ £ i) Alleyn Road 102 Limited 100 100
The Dulwich Estate owns the entire issued share capital of the Company which comprises 100 shares of £1. The Company was incorporated in England & Wales (Company No: 08350222) on 7 January 2013. The Company has no employees. At 31 March 2018, the Company owed the Charity £44,297 which is included in the Balance Sheets of the Company and the Charity under current liabilities and current assets respectively. In addition, the Charity made a loan to the Company of £1,471,000 in 2013. This is repayable, in full, on demand by the Charity and bears interest at 4% above the Bank of England Base Rate, totalling £355,920 to 31 March 2018 (2017: £280,736). A development loan has been made to the company of £1,381,320, this bears interest at 3.5% p.a above the Bank of England Base Rate, totalling £89,487 to 31 March 2018 (2017: £39,568), which is rolled up and added to the principal. The financial statements of the Company for the years ended 31 March 2018 and 31 March 2017 are summarised as follows: 2018 2017 £ £ Profit & loss account Turnover - - Administration expenses (4,787) (4,098) Loss (4,787) (4,098)
Balance Sheet Fixed assets 3,297,637 2,798,365 Current assets 57 91 Less: creditors (3,345,384) (2,841,359) Net liabilities (47,690) (42,903) Called up share capital 100 100 Profit and loss account (47,790) (43,003) Shareholder’s funds (47,690) (42,903)
38 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
2018 2017 10 (b) INVESTMENT IN SUBSIDIARY UNDERTAKINGS (continued) £ £ ii) Dulwich Estate Services Limited 3 3 The Dulwich Estate owns the entire issued share capital of the Company which comprises 3 shares of £1. The Company was incorporated in England & Wales (Company No:03606623) on 30 July 1998 and commenced trading on 1 April 1999. The Company has no employees but the services of the Charity’s staff are made available to it at a cost based on time spent. At 31 March 2018, the Company owed the Charity £7,562 (2017: £13,553) which is included in the Balance Sheets of the Company and the Charity under current liabilities and current assets respectively. The financial statements of the Company for the years ended 31 March 2018 and 31 March 2017, are summarised as follows: 2018 2017 £ £ Profit & loss account Turnover 22,602 3,466 Administration expenses (4,778) (3,070) Profit 17,824 396 Gift Aid to The Dulwich Estate (396) (1,215) Retained profit for the year 17,428 (819)
Balance Sheet Current assets 54,078 24,640 Less: creditors (36,251) (24,241) Net assets 17,827 399 Shareholder’s funds 17,827 399
Group Charity 2018 2017 2018 2017 11 DEBTORS £ 000’s £ 000’s £ 000’s £ 000’s Rents, insurance and maintenance charges 1,282 1,349 1,282 1,349 Property repair contracts 48 14 48 14 Sale of Estate property 11 11 11 11 Investment income 106 183 106 183 Scheme of Management - 5 - 5 Christ’s Chapel of God’s Gift at Dulwich Charity - 2 - 2 The Dulwich Almshouse Charity - 159 - 159 Alleyn Road 102 Limited - - 44 40 Dulwich Estate Services Limited 8 14 8 14 Sundry accounts 732 623 733 624 2,187 2,360 2,232 2,401
Group Charity 12 CASH AT BANK, ON DEPOSIT AND IN HAND 2018 2017 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s Cash at bank and in hand 11 8 11 8 Deposit accounts 4,076 11,887 4,076 11,887 4,087 11,895 4,087 11,895 Special deposits 509 546 509 546 4,596 12,441 4,596 12,441
Special deposits are those segregated accounts in which rental deposits and service charges received in advance of expenditure are held. The interest earned on these deposits is applied for the benefit of the appropriate tenants/householders.
The Dulwich Estate Annual Report 2018 39
The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
13 CREDITORS Group Charity 2018 2017 2018 2017 £ 000’s £ 000’s £ 000’s £ 000’s
Rents, maintenance charges and insurance due and received in advance 1,038 926 1,038 926 Property repair contracts 27 38 27 38 Trade creditors 252 1,252 252 1,252 Scheme of Management 38 - 38 - Sundry accruals 1,136 1,234 1,136 1,234 Christ’s Chapel of God’s Gift at Dulwich Charity 5 - 5 - The Dulwich Almshouse Charity 102 - 102 - Sundry creditors 672 647 668 644 Capital Distribution payable to Beneficiaries - 10,000 - 10,000 Balance of Income Distribution payable to Beneficiaries 5,261 2,491 5,261 2,491 8,531 16,588 8,527 16,585
14 THE GROUP FUNDS At 1 April Income Expenditure Transfers Gain on Actuarial At 31 March 2017 between Investment Loss 2018 funds Assets £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s £ 000’s
PERMANENT ENDOWMENT Property Valuation Fund 229,833 - - 3,699 5,585 - 239,117
Capital Reinvestment Fund 75,800 - - (3,715) 619 - 72,704
305,633 - - (16) 6,204 - 311,821
DESIGNATED Residential Property Repairs 253 - (748) 750 - - 255 Commercial Property Repairs 253 - (54) 63 - - 262 Estate Office Repairs 37 - (10) 10 - - 37 Estate Development Reserve 1,281 - (49) (183) - - 1,049 Pension Equalisation Fund 29 - - (29) - - - 1,853 - (861) 611 - - 1,603
RESTRICTED 560 11,445 (11,209) (595) - 234 435
TOTAL FUNDS 308,046 11,445 (12,070) - 6,204 234 313,859
40 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
14 THE GROUP FUNDS (continued)
Property Valuation Fund This fund represents the value of the Charity’s property and includes the surpluses arising on revaluation plus the cost of additions and improvements.
Capital Reinvestment Fund This represents the proceeds from sales of the Charity’s properties which have been used to purchase investments, the surplus or deficit arising on the revaluation of these investments less the capital distribution to beneficiaries made during the year.
DESIGNATED FUNDS In accordance with clause 3. (2) of the Scheme dated 31 July 1995, the Board of Trustees has established designated funds, by annual transfers from the Restricted Fund, to meet the future costs of managing, maintaining, developing and improving land and maintaining, repairing, improving and rebuilding the buildings thereon.
Real Estate Repair Funds These funds are to meet the costs of cyclical repairs and maintenance to the Charity’s residential property, commercial property, and its Estate Office. During the year £750,000 has been allocated from the Restricted Fund to the Residential Property Repair, £63,000 Commercial Property Repair and £10,000 to the Estate Office Repair Funds, respectively. Money is expended from these Funds annually.
Estate Development Reserve The Estate Development Reserve is maintained for the purpose of development of the real estate of the Charity. During the year, costs of £49,396 were charged to this account and £16,718 was transferred to the Capital Reinvestment Fund, whilst £200,000 was allocated to the Restricted Fund for distribution to the Beneficiaries.
Pension Equalisation Fund The balance on the fund primarily represented the prior year adjustment for 2004/2005 resulting from the adoption of FRS17 disclosures in 2005/2006. The fund is no longer necessary at year end, and the full balance of £29,600 has been released.
RESTRICTED FUND This represents the balance of unspent income of the Charity which is used to: defray all costs of managing the Charity and maintaining its property (including net transfers to Designated Funds); make the annual payments to The Dulwich Almshouse Charity and Christ’s Chapel of God’s Gift at Dulwich Charity with the remainder of income applied solely to the Beneficiary Schools (Note 16). The balance on the consolidated Fund arises following the adoption of FRS102 and represents the accumulated pension asset at 31 March 2018 less the accumulated losses of subsidiary undertakings, which are not distributable to beneficiaries.
The Dulwich Estate Annual Report 2018 41
The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
15 ANALYSIS OF GROUP AND CHARITY NET ASSETS BETWEEN FUNDS Permanent Designated Restricted Endowment Funds Fund Funds Total £ 000’s £ 000’s £ 000’s £ 000’s
Operational property 1,450 1,450 Other tangible fixed assets - 65 - 65 Intangible fixed assets - 32 - 32 Real estate - - 237,667 237,667 Investments - - 75,740 75,740 Pension asset - 483 - 483 Net current assets/(liabilities) 1,603 (145) (3,036) (1,578) 1,603 435 311,821 313,859
16 (a) INCOME DISTRIBUTION TO BENEFICIARIES Percentage 2018 2017 Share of Total Total Beneficiary Remainder £ 000’s £ 000’s The Dulwich Almshouse Charity 110 110 The Dulwich Almshouse Charity Special distribution - 200 Christ’s Chapel of God’s Gift at Dulwich Charity 30 30 140 340 Dulwich College 36.334% 2,766 2,396 Alleyn’s School 26.499% 2,017 1,753 James Allen’s Girls’ School 22.996% 1,751 1,532 The Central Foundation Schools of London 10.923% 831 723 St Olave’s and St Saviour’s Schools Foundation 3.248% 247 215 Total Distribution 100% 7,752 6,959
Under the terms of the Charity’s governing Scheme, it is obliged to distribute its net income to its Beneficiaries. The annual payments to Christ’s Chapel Charity and to The Dulwich Almshouse Charity are set out in the Scheme and were originally fixed at £30,000 and £80,000 respectively. However, with the approval of the Charity Commission, the annual payment to the Almshouse Charity has been increased to £110,000. The distribution to each of the Schools Beneficiaries is also determined by the Scheme: the percentages paid to The Central Foundation Schools of London and to St Olave’s and St Saviour’s Schools Foundation are fixed as shown above, with the Dulwich Schools receiving the balance (85.829%) being apportioned between them in accordance with the average numbers of pupils attending each school during the preceding three years.
During the year, actual payments to the Beneficiaries totalled £14,642,346 (2017: £6,676,742).
42 The Dulwich Estate Annual Report 2018
The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
16 (b) CAPITAL DISTRIBUTION TO BENEFICIARIES Percentage 2018 2017 Share of Total Total Beneficiary £ 000’s £ 000’s
Dulwich College 36.125% - 3,598 Alleyn’s School 26.544% - 2,649 James Allen’s Girls’ School 23.160% - 2,336 The Central Foundation Schools of London 10.923% - 1,092 St Olave’s and St Saviour’s Schools Foundation 3.248% - 325 100% - 10,000
Under the terms of the Charity’s governing Scheme, distribution of capital is solely at the discretion of the Trustees and capital may only be applied to the School Beneficiaries. This distribution is determined as in note 16 (a) above, but the apportionment between the Dulwich Schools is based on the average pupil numbers during the preceeding five year period.
17 RELATED PARTY TRANSACTIONS
As explained in the Report of the Trustees, The Dulwich Almshouse and Christ’s Chapel of God’s Gift at Dulwich are connected charities of The Dulwich Estate. In addition to the distribution made to these (Note 16), The Dulwich Estate’s staff provided services to them at a gross cost, including VAT, for the year of £22,514 (2017: £22,571) and £12,974 (2017: £12,641) respectively. The Dulwich Almshouse Charity leased a property from The Dulwich Estate, to house its Warden, at a cost of £21,420 (2017: £20,365).
18 PENSION SCHEMES
Defined contribution Scheme On 1 February 2004, The Dulwich Estate opened a contributory defined contribution, Group Personal Pension Scheme. Membership of the Scheme is available to all qualifying employees joining The Dulwich Estate after 1 March 2003. The Scheme meets the requirements of a stakeholder pension scheme. Pension contributions paid by The Dulwich Estate, as employer, for the year were £112,353 (2017: £89,913).
Death in service benefits Since 1 April 2008, lump sum Death in Service benefits are provided through a separate scheme.
Defined benefits Scheme The Dulwich Estate also operates a contributory, defined benefits pension scheme which was open to all qualifying employees until 28 February 2003. The Scheme, which was contracted out under the terms of the Social Security Pensions Act 1975 until April 2016, is administered by Trustees and its assets are held independently from those of the Charity. Contributions are paid to the scheme in accordance with the recommendations of the Scheme actuary. During the year ended 31 March 2016, the Scheme Actuary carried out the triennial actuarial valuation as at 31 March 2015. This disclosed a Scheme surplus in assets over liabilities of £0.5m. The Trustees’ policy on funding the scheme is to meet the cost of benefits as they accrue, and therefore the Charity pays contributions of 38.6% of annual pensionable salary in respect of future service and spouses’ death in service benefits.
The Dulwich Estate Annual Report 2018 43 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
18 PENSION SCHEMES (continued) FRS102: The actuarial valuation was updated to the accounting dates in accordance with FRS102 by the Scheme Actuary. Allowance was made for benefit accrual, expected investment returns, actual contributions and cashflows, and the results adjusted to reflect the assumptions at the reporting date. The estimated amount of total employer contributions expected to be paid to the Scheme during the year to 31 March 2019 is £101,000. In addition, insurance premiums are paid to the separate death in service scheme.
The following table sets out the key FRS102 assumptions used for the Scheme.
Assumptions 2018 2017 % p.a. % p.a.
Price inflation 3.3 3.4 Discount rate 2.7 2.7 Pension increases (LPI) 3.2 3.3 General salary increases 2.3 2.4
Y ears Years Current pensioners age 65 - males 23.4 23.4 Current pensioners age 65 - females 24.6 24.6 Future pensioners (currently 45) - males 24.7 24.7 Future pensioners (currently 45) - females 26.1 26.0
The amount included in the Balance Sheet arising from The Dulwich Estate’s obligations in respect of the Scheme is as follows:
Balance Sheet £ 000’s £ 000’s Fair value of assets 5,758 7,612 Present value of liabilities (5,275) (6,286) Balance Sheet limitation - (723) Gross pension asset 483 603
The following amounts have been allocated across the Expenditure categories of the SOFA: £ 000’s £ 000’s
Employer’s part of current service cost 93 88 Interest cost 25 34 Settlements 408 - Expected return on Scheme assets (31) (61) Total pension expense 495 61
44 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
18 PENSION SCHEMES (continued) 2018 2017
The current allocation of the Scheme’s assets is as follows: % p.a. % p.a. Equity instruments 41 47 Debt instruments 42 32 Property 3 3 Cash 14 18 100 100
Changes in the present value of the Scheme liabilities are as follows: £ 000’s £ 000’s Opening present value of Scheme liabilities 6,286 4,939 Annuities bought in members’ names - (103) Interest Cost 174 170 Contributions from Scheme members 15 18 Service Cost 93 88 Actuarial gain 392 1,186 Benefits Paid (164) (12) Settlements (1,521) - Closing present value of Scheme liabilities 5,275 6,286
Changes in the fair value of the Scheme assets are as follows: Opening fair value of the Scheme assets 7,612 6,738 Annuities bought in members’ names - (103) Interest Income 205 231 Actuarial (loss)/gain (97) 610 Contributions by the Employer 141 164 Contributions by Scheme members 15 18 Benefits paid (164) (12) Non Investment Expenses (25) (34) Settlements (1,929) - Closing fair value of Scheme assets 5,758 7,612
The actual return on the Scheme’s assets during the year to 31 March 2018 was a gain of £108,000 (2017: gain of £841,000). The amount recognised in the “gains and losses” categories of the SOFA under the heading “actuarial gains and losses on defined benefit scheme” for the year to 31 March 2018 is a gain of £234,000 (2017: gain of £13,000).
2018 2017 2016 £ 000’s £ 000’s £ 000’s Fair value of Scheme assets 5,758 7,612 6,738 Present value of Scheme liabilities (5,275) (6,286) (4,939) Gross pension asset 483 1,326 1,799
Experience adjustments on Scheme assets Amount of (loss)/gain (97) 610 353 Percentage of Scheme assets (1.7%) 8.0% (5.2%) Experience adjustments on Scheme liabilities Amount of gain/(loss) 30 (62) 114 Percentage of present value of Scheme liabilities .6% (1.0%) 2.3%
The Dulwich Estate Annual Report 2018 45 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
19 TRUSTEES All Trustees give their time freely and receive no remuneration for their services. No Trustee received any reimbursement of costs. Some Trustees live in Dulwich and, as freeholders of property on the Estate, are subject to the Scheme of Management (Note 7). These accordingly pay the appropriate Charge as determined by the Council Tax band applicable to the property. As permitted under the Scheme governing the Charity, a Trustee Indemnity Insurance policy has been effected at a cost of £1,220 (2017: £1,220).
20 NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
Note 2018 2017 £ 000’s £ 000’s (a) Returns on investments
Interest received 12 9 Dividends received 2,335 2,283 Investment & deposit income 2,347 2,292
(b) Capital receipts/(expenditure)
Sales of land & buildings 8 1,843 4,580 Improvements to properties 8 (5,542) (9,741) Purchases of fixed assets 9 (48) (61) Purchases of investments 10 (22,797) (45,275) Sales of investments 10 25,303 58,647 Net proceeds / (cost) of currency hedging 10 1,934 (3,456) 693 4,694
(c) Analysis of Change in Net Funds At 1 April Cashflows At 31 March 2017 2018 £ 000’s £ 000’s £ 000’s Cash at bank, on deposit and in hand 12 12,441 (7,845) 4,596 Cash held in investment portfolio 10 534 440 974 Money Market Funds 170 - 170 13,145 (7,405) 5,740
46 The Dulwich Estate Annual Report 2018 The Dulwich Estate Notes To The Financial Statements Year Ended 31 March 2018
21 ANALYSIS OF INCOME AND EXPENDITURE BY FUND 2018 Restricted Designated Endowment Total £ £ £ £ Income: Real estate income 8,880 - - 8,880 Tollgate receipts 294 - - 294 Investment income 2,271 - - 2,271
Expenditure: Raising funds Real estate maintenance expenditure (2,724) (861) - (3,585) The Scheme of Management (47) - - (47) Tollgate expenses (168) - - (168) Investment management fees (386) - - (386)
Charitable activities
Income Distribution to Beneficiaries (7,752) - - (7,752) Capital Distribution to Beneficiaries - - - - Governance costs (132) - - (132)
236 (861) - (625)
2017 Restricted Designated Endowment Total £ £ £ £ Income: Real estate income 7,950 - - 7,950 Tollgate receipts 241 - - 241 Investment income 2,303 - - 2,303
Expenditure: Raising funds Real estate maintenance expenditure (1,885) (1,026) - (2,911) The Scheme of Management (52) - - (52) Tollgate expenses (160) - - (160) Investment management fees (394) - - (394)
Charitable activities
Income Distribution to Beneficiaries (6,959) - - (6,959) Capital Distribution to Beneficiaries - - (10,000) (10,000) Governance costs (85) - - (85) 959 (1,026) (10,000) (10,067)
The Dulwich Estate Annual Report 2018 47 The Old Dairy Health Centre on Croxted Road in West Dulwich opened in 2018
48 The Dulwich Estate Annual Report 2018
The Old College, Gallery Road, Dulwich, London, SE21 7AE thedulwichestate.org.uk Tel: 0208 299 1000
50 The Dulwich Estate Annual Report 2018