Newark and Sherwood Homes Ltd NewarkKelham Hall,and Sherwood Kelham, Newark Homes onLtd Trent, Directors’ Report and KelhamNottinghamshire Hall, Kelham, NG23 Newark 5QX on Trent, Nottinghamshire NG23 5QX Financial Statements Email: [email protected] Email: [email protected] for the year ended General Enquiries GeneralLocal Call Enquiries Rate: 0845 258 5550 31st March 20162015 Local Call Rate: 0845 258 5550 Fax: 01636 655514 Website: www.nshomes.co.uk Website: www.nshomes.co.uk Newark and Sherwood Homes Ltd OurOur VisionVision isis “delivering“to deliver excellent Housing Services” Company Limited by Guarantee Registered Number 05145364 A Company registered in England and Wales VAT No. 847 7340 01 Contents Strategic Report 3 Statement of Internal Financial Control 7 Statement of Directors’ Responsibilities 9 Report of the Independent Auditors to the Members of Newark 10 and Sherwood Homes Ltd Statement of comprehensive income 12 Statement of financial position 13 Statement of Cashflows 14 Statement of changes in equity 15 Notes 16-27 Company Information , Company Registration Board of Directors: Number: 05145364 Councillor Mrs Celia Brooks Council Board Member Registered Office: Kelham Hall Kelham Mrs Jean Clark Tenant Board Member Newark On Trent Nottinghamshire Independent Board Mrs Lynn Clayton NG23 5QX Member Bankers: Councillor Peter Duncan Council Board Member National Westminster Bank Market Place Newark On Trent Mr Arthur Fell Tenant Board Member Nottinghamshire NG24 1DY Mr Michael Frettsome Tenant Board Member Solicitors: Independent Board Newark and Sherwood District Mr Brendan Haigh Member Council Kelham Hall Kelham Councillor Paul Handley Council Board Member Newark On Trent Nottinghamshire Miss Susan Murphy Tenant Board Member NG23 5QX Towers and Hamlin Councillor David Payne Council Board Member 3 Bunhill Row London Independent Board Mrs Lesley Robinson EC1Y 8YZ Member Independent Board Auditors: Mr Ken Sutton Beever and Struthers Member St George’s House 215-219 Chester Road Manchester M15 4JE Newark and Sherwood Homes Limited senior management Rebecca Rance BA (Hons) MBA.MCIH - Chief Executive Stephen Feast BA (Hons) FCIH - Director and Company Secretary 2 Strategic Report Introduction The Directors of the Board present their annual report and the audited financial statements for the period ended 31st March 2016. The Company’s function during the year was the management and maintenance of its own and the housing stock of Newark and Sherwood District Council. This includes management of the investment programme to deliver investment to maintain a viable financial business plan for the Company and the Council’s Housing Revenue Account. The Vision of the Company is “delivering excellent Housing Services”. Newark and Sherwood Homes will deliver through our Mission by: Managing and maintaining homes to agreed standards and offering services to support vulnerable people in the community and their own homes Engaging with our customers, tenants, residents, the public, and staff to get the best possible service for every pound spent Building homes for local people and providing opportunities for people to access the housing they need Encouraging tenant involvement in the management of their homes Business Review - Financial results Under the Management Agreement with the Council, the Company received a fee of £7.7m to manage an average stock of 5,444 properties on behalf of the Council. The Company also manages 7 of its own properties. The total turnover for the Company for the year was £8.7M (compared to £9.3M during 2014/15). This comprised of rental from the letting of its own properties, the Management Fee, other Management Fee income for managing the capital programme, programmes delivered via secured grant funding and the Feed-In Tariff from previous investment in the solar panels. During the year the Company invested or allocated resources of £2.02M in the provision of new social housing within the District through developing assets of the Company and through financial support to Newark and Sherwood District Council. The recognised gain on the statement of total comprehensive income was £475k for 2015/16 (compared to a loss of £1,323k for 2014/15), £1,313k of which relates to the actuarial gain recognised on the pension liability. There was a loss on ordinary activities of £838k, which was incurred after making a contribution of £1,220k to NSDC in relation to the development 32 properties as part of the 2015-18 affordable homes programme. A total of £1,026k was transferred to reserve balances. The £1,026k transferred to reserve balances relates to the following movements: £497k has been transferred into the company’s growth reserve, £450k has been transferred into the company’s capital financing reserve and £79k has been transferred to the NSH activities 3 reserve, in relation to the surplus during the year before adjustments required to recognise the movement on the pension liability. The accounts have been prepared on a prudent basis and have provided for a total tax liability for the year of £4k. Business Review - Key Achievements during the year i. Progressing the development of the Company first new build properties. Four properties will be delivered in May 2016, on time and to budget. This is a milestone event for the Company to deliver additional affordable housing into the District. ii. Successful project management of the Councils 15/18 New Build Scheme delivering 32 units, on time, to budget and to the Code for Sustainable Homes Level 3 standard. The Company is also proud to have supported the Council to secure grant funding through its work in developing another successful bid application to the HCA and financial appraisal work which will deliver a 60 unit development scheme within the next two years. iii. Proactive joint working with the Council to consider and maximise the capacity of the Housing Revenue Account using the expertise of the Company and the Council to set the future development programme through the most appropriate delivery mechanisms. iv. The Company set a breakeven budget for 2015/16 and over performed against this target by £79k through the continued focus on efficiency plans and maximisation of resources. v. Newark and Sherwood Homes has established a low cost base whilst delivering high performance and high satisfaction levels, when comparing total costs against peers the Company continues to achieve upper quartile performance. vi. The Company achieved the Investors in Excellence Accreditation as part of the commitment to continual improvement focused on What Matters Most including investing in and supporting our staff to maximise capacity and develop new skills. vii. Customer feedback is an integral part of the continual improvement culture and a new customer satisfaction system was implemented during the year to enhance the feedback information and onward learning embedding. viii. The new tenant involvement mechanisms have been implemented during the year working with our active tenants to develop news ways for customers to be involved, influence and challenge the services we provide. ix. The Company continues to be active in the national housing arena, including our Chief Executive, Rebecca Rance, being on the National Federation of ALMOS Executive Steering Group. x. Implementation of agile working for staff supported with Wi-Fi access across the District, development of the new website which will be launched early next financial year, bar coding within the stores services and enhancements to the asset management systems. These all fall under the umbrella “E-Project” which is a large scale programme of works focused on enhanced service delivery through utilising technology whilst delivering future efficiencies to support the financial viability. xi. The Board was delighted to achieve ROSPA Gold awards for the 7 year running. 4 Business Review - Performance Review The table below gives a summary of the Company performance during 2015/16. Performance Measure 2015/16 Target 2015/16 Performance Rent collection 96.25% 99.27% Void rent loss 2% 0.7% Properties at decent homes 100% 100% standard Average re-let time days 18 Days 16 days Reactive repairs within target 98.9% 98.66% time Customer Satisfaction 90% 93% Business Review - Business Environment and Principal Risks Newark and Sherwood Homes has a thirty year Management Agreement to provide services for Newark and Sherwood District Council which came into effect from October 2013. During this year the Company has worked jointly with the Council to undertake a strategic review of the Housing Revenue Account and growth delivery mechanisms to achieve the Company and the Councils growth aspirations and longer term housing vision and strategy. The Company has also focused on the delivery of its growth strategy through the requirement to deliver efficiencies and inward investment targets and both targets were successfully achieved which released finance for the Company to align to build on its land during the next financial year. The challenging economic climate and national Government policy continues to impact on the Company and is expected to have a longer term impact on our customers and our operating environment. The Management Agreement requires an annual 3% efficiency and the Company’s fee is reduced accordingly with a rebasing at year 4 (2017/18). The Company recognises that managing risk is a critical element in achieving its vision and mission. The Company has a Risk Management Strategy which sets out the risk management approach and responsibilities and has a risk register and matrix which is reviewed monthly by the Board. As at March 2016 there were no high rated risks identified. Future Developments There are significant challenges and opportunities ahead for Newark and Sherwood Homes and we are looking forward to building on what has already been achieved. Focus for the following year: i. Expanding the financial business plan to a thirty year to support further strategic planning and effective long term financial management. 5 ii. Working with the Council to establish the rebasing of the management fee for 2017/18.