RAILWAY BENEVOLENT INSTITUTION
Registered Charity No. 206312
ANNUAL REPORT AND ACCOUNTS
Year Ended 31st December 2008
Electra Way, Crewe Business Park
Crewe, Cheshire CW1 6HS
Tel:
01270 251316
Fax:
01270 503966
www.railwaybenefitfund.org.uk
email : [email protected]
RAILWAY BENEVOLENT INSTITUTION
Registered Charity No. 206312
ANNUAL REPORT AND ACCOUNTS
Year Ended 31st December 2008
RAILWAY
BENEFIT
FUND
Looking after our own
Electra Way, Crewe Business Park
Crewe, Cheshire CW1 6HS
Tel:
01270 251316
Fax:
01270 503966
www.railwaybenefitfund.org.uk
email : [email protected]
Annual Report and Accounts 2008 Railway Benevolent Institution
CONTENTS
Page
Reference and Administrative Details
1
Committees
2
Report of the Board of Management
3 - 10
Independent Auditors’ Report
11
Statement of Financial Activities
12
Balance Sheet
13
Notes to the Accounts
Annual Report and Accounts 2008 Railway Benevolent Institution
14 - 22
REFERENCE AND ADMINISTRATIVE DETAILS
Registered Name
Railway Benevolent Institution
Registered Charity Number
206312
Working Name
Railway Benefit Fund
Registered Address
Electra Way, Crewe, Cheshire CW1 6HS
President
Vice Presidents
Sir William McAlpine
G R Burt, OBE, BEM
D J Cobbett, ERD, TD
S Grout
The Rt. Hon. The Lord Snape of Wednesbury
A P Watkinson
Richard Wilson
Board of Management
D Allen - Chairman
S K Osborne - Deputy Chairman
G Burns
R N Eccles
C R B Goldson, OBE
L J Green
A Marshall
J A McKinnell, MBE
C R Postle
D A Redfern
J F L Reeves
P C Trewin
J Walsh
K Watson
Director/Secretary
K Alldread
Auditors
Messrs Geens, Chartered Accountants,
68 Liverpool Road, Stoke-on-Trent, Staffordshire ST4 1BG
Bankers
The Royal Bank of Scotland plc
62/63 Threadneedle St, London EC2R 8LA
Allied Irish Banks plc
40/41 Westmoreland Street, Dublin 2
Honorary Solicitor
Ms Sara Hollingworth
Investment Advisers
Cazenove Capital Management Limited
12 Moorgate, London EC2R 6DA
Annual Report and Accounts 2008 Railway Benevolent Institution
1
COMMITTEES
Benefits Committee
Development Committee
Nominations Committee
C R Postle - Chairman
J A McKinnell, MBE - Deputy
Chairman
Ms Rose Coulson
L J Green
V Hince
P Radley
K Watson
D Allen - Chairman
S K Osborne - Deputy
Chairman
K Alldread - Secretary
A Marshall
D A Redfern
P C Trewin
K Watson
S K Osborne - Chairman
A Marshall
P C Trewin
Scottish Management
Committee
Irish Management
Committee
G Burns - Chairman
A McCrae - Deputy Chairman
J Sharp - Secretary
Revd S Black
Miss M Connor
C Dodgson
P McGarry
J Steele
M Welsh
W Welsh
J P Walsh - Chairman
R Kelly - Secretary
R F Corbet
D Buckley
Dr M D’Arcy
A R Fearn
M F Flannery
E Gahan
Investment Review
Committee
J A McKinnell, MBE - Chairman
C R B Goldson, OBE
D A Redfern
P C Trewin
J F Higgins
J B Hodgins
P O Jennings
J B Mooney
P Murphy
R O’Farrell
G Ryan
W Rothwell
AREA COMMITTEES
Eastern
Southern
Western
C R Postle - Chairman
P Radley - Deputy Chairman
Mrs P Postle - Secretary
R Ball
M Cole
J Melton
D McGregor
C Stannard
S Swallow
K Watson - Chairman
R Smith, OStJ - Deputy
Chairman & Acting Secretary
P Contractor
J Perry
J Roffey
D J Smith
J F L Reeves - Chairman
G R Diver - Secretary
D Aston
A Cook
D Higman
R Jones
W S D Jones
J Lund
I Nisbet
T Stevenson
D A Fletcher
Mrs V Fletcher
A Galley
I Gibson
L Johnson
G McCoy
L Rhead
G Round
R Sheridan
G Thomas
A Turkington
H Wainwright
Mrs J Williamson
B Wootton
Midland
A Marshall - Chairman
M Roocroft - Dep. Chairman
J Wilber - Secretary
Rev J Bassett
T Bawdon
B Chappell
J Cooper MBE
J T W Disney
Annual Report and Accounts 2008 Railway Benevolent Institution
2
REPORT OF THE BOARD OF MANAGEMENT
The Board of Management submits its annual report and the audited financial statements for the
year ended 31 December 2008.
Review of Year
The Railway Benefit Fund (RBF) exists to help railway people in need and in 2008 we provided
financial help to some 656 people both from the retired community and increasingly from active
staff too – evidence of a greater awareness of the Fund within the industry. This included
annuities, where a continuing need is identified but it was largely made up of grants to meet
specific needs such as:
scooters and other mobility aids for the disabled; help with debts and arrears;
minor house repairs; funeral expenses and residential care.
In addition, 45 grants were made for the benefit of 80 children whose parents were in financial
difficulty.
Compared with 2007, total expenditure on charitable activities reduced by £15,000 to roundly
£551,000, yet the need for our help is undiminished. We continue to work closely with other
charities such as the Soldiers, Sailors, Airmen and Families Association (SSAFA) and we
continue to handle grant applications on behalf of the Railway Housing Association. This we do
in return for an annual donation which increased by £5,000 to £35,000 this year. As usual we
reviewed the maxima of all grants and made a number of increases to keep pace with rising
costs.
2008 was a memorable year for the RBF being the 150th Anniversary of its formation as the
Railway Benevolent Institution in 1858. A number of events were held to celebrate this
milestone culminating in a Grand Dinner at The Brewery in London. Harking back to fund raising
of yore, it had a Dickensian theme and attracted over 300 people primarily from current railway
companies. It was with some pride that we were able to recall a famous speech made by
Charles Dickens as host to one of the earliest fund raising dinners held by the RBF. During the
evening guests were entertained by a memorable children’s choir with songs from Oliver,
jugglers, magicians, street urchins and the gentle humour of Barry Cryer and Colin Sells. Our
thanks for a wonderful evening go to all those who attended but particularly to our sponsors and
key supporters on the night, First Group, EWS (now DB Schenker) and our President Sir
William McAlpine without them it would have been a good deal less rewarding. The feedback
was excellent and it is our intention to repeat the event on an annual basis but to move it away
from the log jam of competing events in the autumn to the spring of 2010 et seq.
At the dinner First GB Railfreight presented us with a cheque for £10,000 being monies raised
by their staff during the year in response to a challenge by the Managing Director, John Smith
and his senior management team. They adopted the RBF as their charity for 2008 and set
about raising funds in a number of ways from abseiling to sponsored cycle rides to quiz nights.
Our sincere thanks go to the staff of GB Railfreight for their tremendous effort and generosity.
Other highlights during 2008 included the 2nd Annual Scottish Dinner sponsored by Transport
Scotland. We are enormously grateful for their support and the enthusiasm of our champions in
Scotland, First Scotrail for helping to organise this Dinner.
We are also grateful to John Fitzgerald for his help in staging our first golf tournament at
Hendon GC which made us a lot of new friends.
Annual Report and Accounts 2008 Railway Benevolent Institution
3
REPORT OF THE BOARD OF MANAGEMENT (Continued)
As a result of the success of these events there will be a third Annual Scottish Dinner on 28th
August 2009 and a second Golf Tournament on 4th June 2009. The programme of fund raising
activities currently planned for 2009 is as follows:
Auction of Virgin Trains Nameplates which took place on 14th February 2009 at
Waterloo International Station.
The second RBF Golf Tournament on 4th June 2009 at Hendon Golf Club.
The third Annual Scottish Dinner on 28th August 2009 at Glasgow Science Centre
London Dinner in April 2010.
Prize Draw at the HSBC Rail Business Awards which took place on 19th February
2009.
Prize Draw at the National Rail Awards in September 2009.
Prize Draws/collections at the Annual Luncheons of the Institution of Mechanical
Engineers, the Institution of Rail Signal Engineers and the Institution of Rail
Operators.
The various prize draws / collections listed above are all repeats of fund raising efforts made at
events in 2008 namely the HSBC Rail Awards, the National Rail Awards, the Institution of
Mechanical and Electrical Engineers’ Annual Luncheon, the Railway Signal Engineers’ Annual
Luncheon, The Institution of Railway Operators’ Annual Luncheon and the Railway Industry
Association’s Annual Dinner. Together these raised a lot of money and provided priceless
exposure for the RBF. We are indebted to all of the above organisations, the more so because
they have agreed to repeat their generous help in like fashion in 2009.
We must also thank those friends and organisations who provided some terrific prizes including
Eurostar, GNER Virgin, Cameron House and First ScotRail. We must also acknowledge the
continuing help and support which we receive from our friends at Railnews and Woodhouse
Communications who feature in most of our fund raising activity.
On the corporate front, First Class Partnerships once again made a donation of £2,000 and we
also received donations from DB Schenker (formerly EWS), Go Ahead trains, First Scotrail and
Share Gift.
In total income from fund raising activities net of costs increased to roundly £83,000 a
very significant increase on 2007 when we raised less than £20,000.
That said, resources expended during 2008 exceeded income by over £264,000, an increase of
£4,000 compared with the previous year. This is the eleventh successive year in which we
have had an operating deficit - something compounded by a major fall in world stock markets
resulting in investment losses of some £697,000. During 2008 the RBF’s net funds reduced by
almost 25% to £3,066,000. In view of this major reduction in the asset base and the current
market uncertainty, the Board agreed, with great reluctance at its December meeting that it
simply had to take steps to reduce the operating deficit by cutting the grant giving budget for
2009. Despite this, an operating deficit of over £200,000 is still forecast for 2009 so there can
be no let up in the drive for funds and, as can be seen above, we have started well in what will
be a difficult year for raising funds.
Annual Report and Accounts 2008 Railway Benevolent Institution
4
REPORT OF THE BOARD OF MANAGEMENT (Continued)
As far as possible we will take every opportunity to maintain a high profile in the media through
articles in Rail News, company, union and pension newsletters, and we are working on a
regular news letter to be released shortly. Additionally we will post the latest news about
forthcoming events on our web site (www.railwaybenefitfund.org.uk). In the last few years there
is no doubt that we have succeeded in raising the RBF’s profile within the industry it serves and
we must continue to press for its increasing involvement in our work and fund raising activity.
This plus a refreshed approach to membership and regular giving by active staff are among the
key challenges which lie ahead.
The Financial Results
Net outgoings before investment losses for the year ended 31 December 2008 totalled
£264,506, an increase of £3,837 compared with the previous year as set out in the Statement of
Financial Activities on page 12.
Incoming resources totalled £453,380, an increase of £64,739. Within this, however, voluntary
income of £141,258 which includes regular giving, donations and legacies reduced by £59,567
due to a reduction in legacies of £77,460 which was partially offset by increases elsewhere.
Additionally investment income of £129,380 reduced by £16,492 largely due to withdrawals from
the investment portfolio as a result of the previous year’s operating deficit. Fortunately these
reductions were more than offset by the increase in fund raising income arising from the
activities associated with the RBF’s 150th Anniversary celebrations which totalled £182,742
(2007: £41,944). Income net of direct costs was £83,258, compared with £19,845 in 2007.
During the year a donation was received from HM The Queen and as always we received a
number of donations from the families, friends and colleagues of former railway staff who
passed away during the year. The Board thanks all those who have given so generously and
enabled the RBF to pursue its work - see Note 2 to the Accounts.
Resources expended totalled £717,886, an increase of £68,576 compared to the previous year.
The cost of generating funds totalled £151,219, an increase of £86,096 wholly due to the
increase in fund raising activities, the costs of which totalled £99,484, an increase of £77,385
compared to 2007. Additionally publicity and fund raising consultancy costs increased by
£6,824 largely due to costs associated with the production of a DVD to assist with fund raising.
See Note 4 to the Accounts.
Expenditure on charitable activities totalled £550,610, £14,946 less than in 2007. In total 701
grants were approved compared with 770 in the previous year, leading to a reduction of
£30,353 in actual grant payments which was partially offset by the increase of £15,407 in
support costs as a result of the increase in agency fees. A brief description of each type of
grant is set out in Note 5 to the Accounts.
Governance Costs totalled £16,057, 2.3% of total expenditure (2007: £18,631 and 2.9%). This
relates to the general running of the charity and includes internal and external audit, insurance
costs, legal advice for trustees and costs associated with constitutional and statutory
requirements such as the cost of trustee meetings and preparing the statutory accounts, plus a
share of support costs. The Board monitors the level of these costs on a regular basis. See
Note 6 to the Accounts.
Annual Report and Accounts 2008 Railway Benevolent Institution
5
REPORT OF THE BOARD OF MANAGEMENT (Continued)
Support Costs are allocated across the RBF’s principal activities in line with the SORP - see
Note 3 to the Accounts. Most of this is the cost of the Health Shield agency staff, who deal with
all grant enquiries and provide an important advisory service to applicants. For 2008 support
costs totalled £98,065, an increase of £19,635 compared with the previous year, mainly due to
an increase of £18,482 in the fees paid to Health Shield from £56,860 to £75,342 a year
following the 3 yearly review of the Agency Agreement. Additionally there was an increase of
£5,071 in the Director/Secretary’s costs to allow him more time to spend on Fund Raising
activities which was largely offset by the non-repeat of the web site development costs of
£4,289 incurred in 2007.
On the investment front, after 5 years of investment gains there was a major fall in world stock
markets. As a result the RBF had investment losses of £696,528, a decrease of 17.3%
compared to the opening values; during the same period, the FTSE 100 index decreased by
32.8%. At 31 December 2008 the RBF’s investments under management totalled £2,929,882
including cash of £130,000; a reduction of roundly £1,036,000 compared to the start of the year
as a result of the Investment losses and net cash withdrawals required to fund the operating
deficit.
At 31 December 2008 the RBF’s net funds had decreased by £961,034 to £3,066,387.
Acknowledgements
As always the Board would like to thank RBF members, individuals and organisations who have
donated money during 2008. Without you we would not be able to provide help to those in need
and we hope that you will be able to continue supporting us in future.
We must also thank the members of our Committees - the Benefits Committee, the Nominations
Committee, the Development Committee, the Investment Review Committee, the Scottish and
Irish Management Committees and the four Area Committees, who give so freely of their time in
support of the RBF.
Thanks to the excellent service provided by the Director/Secretary, Keith Alldread and his team,
Margaret Skerratt, Paul Proom and Marion O’Driscoll and the tremendous support we receive
from Health Shield at Crewe, the RBF continues to run smoothly.
We must also thank Virgin Rail, BRB (Residuary) Limited, Network Rail and Iarnrod Eireann for
the provision of meeting facilities for the Annual Meeting and for various Board and Committee
Meetings, all free of charge. We are most grateful for all of this assistance in the furtherance of
our objectives, thank you.
Annual Report and Accounts 2008 Railway Benevolent Institution
6
REPORT OF THE BOARD OF MANAGEMENT (Continued)
Constitution, Objects and Organisational Structure
The Railway Benevolent Institution is registered charity number 206312 and is governed by
Royal Charter granted on the 29th December 1949, as subsequently amended. Its objects, as
set out in the Royal Charter, are “to relieve aged or disabled or necessitous Railwaymen, their
spouses or Children or other relatives or persons who were immediately or partly dependent on
them”. The expressions “Railwaymen”, “Spouses” and “Children” are defined in Clause 2 of the
Charter.
a)
Board of Management
The RBI’s principal governing body is the Board of Management (“the Board”) which is the sole
Trustee. It must consist of not less than 10 and not more than 30 persons. Currently the Board
has 14 Members whose names are recorded on page 1. The appointment of Board Members is
by election at the Annual Meeting. Not less than one third of the Board Members retires
annually by rotation and is eligible for re-election. The Board has the power to fill any vacancies
and to appoint temporarily additional members not exceeding five; all persons appointed in this
way must retire at the next Annual Meeting and are eligible for re-election. The Board of
Management meets four times each year. The Board each year elect a Chairman from among
its number. The Chairman serves for one year and is eligible for re-election. No Member of the
Board is permitted to derive any pecuniary advantage from the RBF.
Both prior to and after their appointment all new Board Members are briefed by the Chairman of
the Board of Management and/or the Director/Secretary and provided with copies of the
Essential Trustee (published by the Charity Commission in June 2005), the Royal Charter,
Rules and Bye-laws, the most recent Board minutes and other key documents. Details of any
new legislation or other developments are included on the agenda for Board meetings.
b)
Committees
The Board is empowered to delegate all or any of its powers to Committees, to which all
members give their services free of charge. Their composition is set out on page 2.
The Nominations Committee is responsible for considering the skills and experience required
and for providing advice on the appointment of nominated individuals to the Board of
Management, all Committees and the Director/Secretary of the charity. It must consist of not
less than two or more than four members and is chaired by the Deputy Chairman.
The Benefits Committee is responsible for granting financial assistance to beneficiaries. It must
consist of not less than three and not more than nine members of whom at least two must be
Members of the Board of Management, who shall be Chairman and Deputy Chairman.
Members of the Committee are appointed by the Board. The Benefits Committee normally
meets monthly.
The Development Committee is responsible to the Board for providing leadership and direction
in the promotion of the RBF, fund raising and increasing membership. In particular this includes
fostering closer relations with companies in the railway industry. It must have a minimum of six
members and is chaired by the Chairman.
Annual Report and Accounts 2008 Railway Benevolent Institution
7
REPORT OF THE BOARD OF MANAGEMENT (Continued)
The Irish and Scottish Management Committees are responsible for granting financial
assistance in Ireland and Scotland respectively and to promote the RBF within their areas.
They consist of not less than three members of whom at least one must be a Member of the
Board of Management.
There are four Area Committees. Their role is to increase awareness of the RBF amongst
railway managers and staff in their areas; to raise funds by seeking donations, legacies, etc and
to identify people in need of help. Where appropriate they make domiciliary visits to potential
beneficiaries.
The Investment Review Committee is responsible for overseeing the management of the RBF’s
investment portfolio within agreed parameters established by the Board and recommending the
appointment of investment managers. It must consist of not less than three or more than six
members, all of whom shall be members of the Board of Management.
c)
Administration
Day to day administration of the RBF is the responsibility of the Director/Secretary, who works
on a part-time basis and is the only direct employee. He is required to act upon the wishes of
the Board and its Committees, to oversee the day to day activities of the agency staff and to
ensure that the activities of the RBF are carried out in accordance with the Charter, Rules and
Bye-laws.
Most of the routine finance and administration work is undertaken by Health Shield Friendly
Society on an agency basis. In particular, they provide the resources to respond to and
investigate enquiries from potential beneficiaries, make recommendations to the Benefits
Committee and maintain the Institution’s financial records. Including the Director/Secretary this
is estimated to equate to four full time staff. Two Board Members (D Allen and J A McKinnell)
are also Members of the Management Committee for Health Shield, but take no active role in
contract discussions between the parties or Board discussions concerning the relationship with
Health Shield.
Policies
a)
Reserves Policy
The RBF’s reserves policy takes into account the Board’s forecast for future income and
expenditure, including the potential for fund raising. In formulating the policy the Board
considered that reserves are required to provide contingency to ensure continuity in the event of
a large variation in the Board’s income for any one year equivalent to one year’s expenditure
and to meet the Board’s potential future liabilities in respect of annuities and residential care
grants (see Note 10 on contingent liabilities). The Board have therefore determined that the
reserves should be maintained at a minimum of £1.2m (2007: £1.4m).
At 31 December 2008 the RBF’s unrestricted reserves totalled £2,498k (£3,318k at 31
December 2007). This represents a decrease of 55% since 31 December 1998 when reserves
totalled £5,560k. During this period the Board has increased grant giving in line with its objects
resulting in operating deficits in each of the last 11 years. These deficits, together with stock
market movements, have caused the decline. Over the next 5 years the Board proposes to
increase fund raising activities to bring the income and expenditure account into balance year
on year, whilst as far as possible maintaining grant giving at current levels.
The position is monitored by the Board on a quarterly basis and the policy is reviewed annually.
Annual Report and Accounts 2008 Railway Benevolent Institution
8
REPORT OF THE BOARD OF MANAGEMENT (Continued)
b)
Investment Policy
The RBF’s investment policy has been formulated after taking full account of Part II of the
Trustee Act 2000 and the advice of our Investment Managers. The policy seeks to achieve the
efficient and prudent management of the RBF’s investments with the aim of maximising the
return on them.
The investment portfolio is managed on behalf of RBF by Cazenove Capital Management
Limited who were appointed in February 2007. Investment performance is reviewed by the
Investment Review Committee who report to the Board every quarter and the Investment
Managers are required to attend at least once a year. The Investment Managers are required
to take into account the implications of social, environmental or ethical issues when they believe
they will have a material impact on the portfolio.
c)
Risk Management
The Board reviews the risks to which the RBF is exposed on an annual basis. The major risk
remains volatility in investments markets. Systems have been established to mitigate this and
all other risks to the extent that this is possible. As a policy no use is made of any financial
derivative products.
d)
Grant Making Policies
The criteria for awarding grants, used by the Benefits Committee and the Irish and Scottish
Management Committees, are reviewed by the Board annually. All grant applications are
carefully vetted by the Director and his staff before being tabled for discussion at Committee
Meetings. Annuities and Residential Care Grants are reviewed at least every two years. A brief
description of each type of grant awarded is set out in Note 5 to the Accounts.
Statement of the Board’s Responsibilities
Law applicable to charities in England and Wales requires the Board of Management to prepare
financial statements each financial year which give a true and fair view of the state of affairs of
the charity and of the incoming resources and application of resources for that period. In
preparing those financial statements the Board is required to:
Select suitable accounting policies and then apply them consistently;
Make judgments and estimates that are reasonable and prudent;
State whether applicable accounting standards and statements of recommended practice
have been followed, subject to any material departures disclosed and explained in the
financial statements;
Prepare the financial statements on a going concern basis unless it is inappropriate to
presume that the charity will continue to operate.
The Board is responsible for keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the charity. They are also responsible for
safeguarding the assets of the charity and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
Annual Report and Accounts 2008 Railway Benevolent Institution
9
REPORT OF THE BOARD OF MANAGEMENT (Continued)
Governance
Processes are in place to ensure that expenditure and performance is monitored and that
appropriate management information is prepared and reviewed regularly by the Board. The
systems of internal control are designed to provide reasonable assurances against material
misstatement or loss. They include:
an annual budget approved by the Board;
regular consideration by the Board of financial results, variances from budget and nonfinancial performance indicators;
delegation of day to day management authority;
identification and management of risks.
All the RBF’s governance arrangements are reviewed annually.
Approved by the Board of Management and signed on its behalf by:
David Allen
Chairman of the Board
30 March 2009
Annual Report and Accounts 2008 Railway Benevolent Institution
10
INDEPENDENT AUDITORS’ REPORT TO THE BOARD OF MANAGEMENT
OF THE RAILWAY BENEVOLENT INSTITUTION
We have audited the financial statements of the Railway Benevolent Institution for the year ended 31
December 2008 which comprise a Statement of Financial Activities, Balance Sheet and related notes.
These financial statements have been prepared under the historical cost convention as modified by the
revaluation of certain fixed assets and the accounting policies set out therein.
This report is made solely to the charity’s Board of Management, as a body, in accordance with
Regulations made under the Charities Act 1993. Our audit work has been undertaken so that we might
state to the charity’s Board of Management those matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the charity and the charity’s Board of Management as a body, for our
audit work, for this report, or for the opinions we have formed.
Respective Responsibilities of the Board of Management and Auditors
As described in the Statement of the Board of Management’s Responsibilities, the Board is responsible
for the preparation of their annual report and the financial statements in accordance with applicable law
and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
We have been appointed as auditors under section 43 of the Charities Act 1993 and report in accordance
with regulations made under section 44 of that Act. Our responsibility is to audit the financial statements
in accordance with relevant legal and regulatory requirements and International Standards on Auditing
(UK and Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view and are
properly prepared in accordance with the Charities Act 1993. We also report to you if, in our opinion, the
Board’s annual report is not consistent with the financial statements, if the charity has not kept proper
accounting records, if we have not received all the information and explanations we require for our audit.
We read other information contained in the Board of Management’s annual report and consider whether it
is consistent with the audited financial statements. We consider the implications for our report if we
become aware of any apparent misstatements or material inconsistencies with the financial statements.
Our responsibilities do not extend to any other information.
Basis of Audit Opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued
by the Auditing Practices Board. An audit includes an examination, on a test basis, of evidence relevant
to the amounts and disclosures in the financial statements. It also includes an assessment of the
judgments made by the Board of Management in the preparation of their financial statements, and of
whether the accounting policies are appropriate to the charity’s circumstances, consistently applied and
properly disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we
considered necessary in order to provide us with sufficient evidence to give reasonable assurance that
the financial statements are free from material misstatement, whether caused by fraud or other irregularity
or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information
in the financial statements.
Opinion
In our opinion the financial statements:
•
give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting
Practice, of the state of the charity’s affairs as at 31 December 2008 and of its incoming
resources and application of resources in the year then ended; and
•
have been properly prepared in accordance with the Charities Act 1993.
Geens, Chartered Accountants
68 Liverpool Road
Stoke-on-Trent,
Staffordshire
ST4 1BG
Annual Report and Accounts 2008 Railway Benevolent Institution
Date:
30 March 2009
11
RAILWAY BENEVOLENT INSTITUTION
STATEMENT OF FINANCIAL ACTIVITIES
for the year ended 31st December 2008
Endowment
Funds
2008
£
Unrestricted
Funds
2008
£
Total
Funds
2008
£
Total
Funds
2007
£
Incoming Resources
Incoming resources from generated funds
Voluntary income
2a
Activities for generating funds
Investment income
2b
23,376
141,258
182,742
106,004
141,258
182,742
129,380
200,825
41,944
145,872
Total Incoming Resources
23,376
430,004
453,380
388,641
-
133,134
18,085
151,219
133,134
18,085
151,219
45,930
19,193
65,123
Notes
Resources Expended
Costs of generating funds
Costs of generating voluntary income
Investment management costs
4
Charitable activities
5
1,104
549,506
550,610
565,556
Governance costs
6
-
16,057
16,057
18,631
Total Resources Expended
3
1,104
716,782
717,886
649,310
22,272
(286,778)
(264,506)
(260,669)
(22,272)
22,272
-
-
-
(264,506)
(264,506)
(260,669)
Net Outgoing Resources before transfers
Transfers between funds
11
Net Outgoing Resources before other
recognised gains and losses
Gains on investment assets
Realised gains
7
6,304
26,184
32,488
119,130
Unrealised (losses) / gains
7
(146,980)
(582,036)
(729,016)
24,328
(140,676)
(820,358)
(961,034)
(117,211)
Funds brought forward at 31.12.07
709,189
3,318,232
4,027,421
4,144,632
Funds carried forward at 31.12.08
568,513
2,497,874
3,066,387
4,027,421
Net Movement in Funds
The Statement of Financial Activities includes all gains and losses recognised in the year.
All incoming resources and resources expended derive from continuing activities.
Annual Report and Accounts 2008 Railway Benevolent Institution
12
RAILWAY BENEVOLENT INSTITUTION
BALANCE SHEET AS AT 31 DECEMBER 2008
Notes
2008
2007
£
£
2,799,882
3,686,210
2,799,882
3,686,210
16,380
16,948
333,446
399,428
349,826
416,376
(83,321)
(75,165)
266,505
341,211
3,066,387
4,027,421
Fixed Assets
Investments
7
Current Assets
Debtors
8
Cash at bank and in hand
Creditors: amounts falling due within one year
9
Net Current Assets
Net Assets
The Funds of the Charity
Endowment funds
11
568,513
709,189
Unrestricted income funds
11
2,497,874
3,318,232
3,066,387
4,027,421
Approved by the Board of Management
and signed on its behalf on 30th March 2009
D. ALLEN
Chairman of the Board
D. A. REDFERN
Board Member
The notes on pages 14 to 22 form part of these accounts.
Annual Report and Accounts 2008 Railway Benevolent Institution
13
RAILWAY BENEVOLENT INSTITUTION
NOTES TO THE ACCOUNTS
for the year ended 31st December 2008
1. Accounting Policies
a) Basis of preparation
The financial statements of the charity have been prepared under the historical cost convention, with
the exception of investments which are included at market value. The financial statements have been
prepared in accordance with the Statement of Recommended Practice (SORP), “Accounting and
Reporting by Charities” published in March 2005, the applicable accounting standards and the
Charities Act 1993.
b) Fund accounting
Unrestricted funds are available for use at the discretion of the Board of Management in furtherance
of the general objectives of the charity and which have not been designated for other purposes.
Endowment funds are funds which are to be used in accordance with specific restrictions imposed by
the donors, and are of a permanent nature. The costs of raising and administering such funds are
charged against the specific fund. The nature of each of the endowment funds is set out in the notes
to the financial statements. Investment income and gains/losses are allocated to the appropriate
fund.
c) Incoming resources
All incoming resources are included in the Statement of Financial Activities (SOFA) when the charity
is legally entitled to the income and the amount can be quantified with reasonable accuracy. For
legacies, entitlement is the earlier of the charity being notified of an impending distribution or the
legacy being received.
d) Resources expended
All expenditure is accounted for on an accruals basis and has been classified under the appropriate
headings. Where costs cannot be directly attributed to particular headings (support costs) they have
been allocated to activities on a basis consistent with the use of the resources.
The Costs of Generating Funds include costs of generating voluntary income and investment fees,
plus a share of support costs. The costs of generating voluntary income do not include the costs of
disseminating information in support of the charitable activities.
Charitable Activities comprise grants made plus a share of support costs. All grants are paid in
accordance with the RBF’s Royal Charter, Rules and Bye-laws. Grants are accounted for only when
paid, with the exception of Annuities which are accrued to the end of the year and pledges made in
respect of Single Benevolent Grants which are dependent on specific conditions which fall outside the
control of the charity. No provision is included in respect of Annuities or Residential Care Grants for
future years.
Governance Costs are those costs associated with the governance arrangements of the charity which
relate to the general running of the charity. This includes internal and external audit, insurance costs,
legal advice for trustees and costs associated with constitutional and statutory requirements such as
the cost of trustee meetings and preparing the statutory accounts, plus a share of support costs.
Support costs are those costs incurred in the support of the fund raising, governance and charitable
activities which cannot be directly attributed. This includes the costs of the Director/Secretary and
agency costs. They have been attributed to activities as described in the notes to the financial
statements.
e) Tangible fixed assets and depreciation
Tangible fixed assets costing more than £1,000 are capitalised and included in the balance sheet at
cost. Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost on a
straight line basis over the useful economic life of the asset.
Annual Report and Accounts 2008 Railway Benevolent Institution
14
Notes to the Accounts (Continued)
f)
Investments
Investments are stated at market value. Realised gains and losses are calculated as the difference
between sales proceeds and their market value at the start of the year, or subsequent cost on
purchase. Unrealised gains and losses represent the movement in market values during the year.
Realised and unrealised gains are combined in the appropriate section of the SOFA.
g) Foreign currencies
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction.
Monetary assets and liabilities are retranslated at the rate of exchange ruling at the balance sheet
date. All differences are taken to the Statement of Financial Activities.
h) Value added tax
Value added tax is not recoverable by the charity and as such is included in the relevant costs in the
Statement of Financial Activities.
2. Incoming Resources
a) Voluntary Income
£
85,309
2007
Re-stated
£
76,194
11,406
35,000
7,867
1,000
55,273
676
141,258
13,995
30,000
2,500
46,495
78,136
200,825
2008
Regular Giving including membership subscriptions
Donations
Individuals
Railway Housing Association
Railway Companies
Other charitable bodies
Legacies
Regular Giving comprises regular payments made by current employees of railway companies
through their company paybill and by former railway employees through the Pensions Management
payroll system or by standing order.
Individual donations are made up primarily of unsolicited donations received during the year. This
always includes generous donations from the families, friends and colleagues of former railway staff
who have passed away and monies raised by collections made at Railway Staff Clubs, at BTPF
branches, by the use of our “Signal Boxes” at annual dinners and a donation from HM The Queen.
This year it also includes a collection made at the Institute of Railway Operators’ Luncheon which
raised almost £1,000.
Since 2004 the RBF has dealt with all claims on behalf of the Railway Housing Association and
Benefit Fund (RHA) in return for an annual donation, which the RHA increased to £35,000 in 2008.
This continues the close relationship between these two railway charities.
During 2008 donations were also received from First Class Partnerships £2,000, DB Schenker
(formerly EWS) £2,650, Go-Ahead Trains £2,000, First Scotrail £1,217 and Share Gift £1,000 (2007:
First Class Partnerships £2,000 and EWS £500).
One legacy of £676 was received during the year from the estate of Mrs D J E Cresswell (2007:
£67,944). At 31 December 2008 there were no legacies in the pipeline.
Annual Report and Accounts 2008 Railway Benevolent Institution
15
Notes to the Accounts (Continued)
b) Investment Income
Income from listed investments
Interest on Portfolio Capital and Income Accounts
Bank interest
2008
£
2007
£
110,708
16,658
2,014
119,718
24,626
1,528
129,380
145,872
3. Total Resources Expended
a) Summary
Direct
Costs
2008
£
Support
Costs
2008
£
Total
Costs
2008
£
Total
Costs
2007
£
Costs of generating funds
138,283
12,936
151,219
65,123
Charitable activities
477,044
73,566
550,610
565,556
4,494
11,563
16,057
18,631
619,821
98,065
717,886
649,310
Total
Costs
2008
£
Total
Costs
2007
£
Governance costs
Total Resources Expended
b) Allocation of Support Costs
Costs of
Generating
Funds
2008
£
Charitable Governance
Activities
Costs
2008
2008
£
£
Management
Director/Secretary
6,492
1,623
8,116
16,231
11,160
Agency fees
5,752
66,649
2,941
75,342
56,860
Information technology
157
78
-
235
4,413
Other costs
535
5,216
506
6,257
5,997
12,936
73,566
11,563
98,065
78,430
Total Support Costs
Support costs consist principally of the salary for the Director/Secretary and the fees paid to Health
Shield Friendly Society for the provision of accommodation and administrative support primarily in
relation to the award of grants. The fees for administrative support which total £67,842 include the
provision of three full time staff. The benefits of this arrangement include the provision of services at
an economic cost and the stability provided by the support of a larger organisation.
Allocation to each of the activity cost categories is based on a broad assessment of the time spent on
each activity by the Director/Secretary and the three Health Shield staff. Other costs have been
allocated on a pro rata basis. Expenditure in 2007 on information technology related to the
development of a new web site and was allocated primarily to the cost of generating funds.
Annual Report and Accounts 2008 Railway Benevolent Institution
16
Notes to the Accounts (Continued)
c) Staff Costs
The average number of persons directly employed during the year and their salary and wages costs
are set out below. There were no employees with emoluments in excess of £60,000.
Staff costs
Salary and Wages Costs
Staff numbers
Management and administration
2008
£
16,231
2007
£
11,160
Number
1
Number
1
Neither Board Members nor any persons connected with them received any remuneration during the
year (2007: £nil). The aggregate amount of expenses reimbursed to Board Members during the year
amounted to £1,730 (2007: £1,484). These were in respect of four Board Members (2007: three) and
represented payments for travel and subsistence costs and other miscellaneous expenses incurred
when attending meetings and fund raising events. Costs have been allocated to the appropriate
headings within the SOFA.
4. Costs of Generating Funds
Costs of generating voluntary income
Publicity
Fund raising consultancy
Event Management and other direct costs
Support costs
Investment management costs
2008
£
2007
£
17,899
2,815
99,484
12,936
133,134
18,085
3,739
10,151
22,099
9,941
45,930
19,193
151,219
65,123
Publicity includes £5,658 relating to work on the production of a DVD for use at Fund Raising Events.
Fund raising consultancy is provided by Woodhouse Communications who also provided the RBF
with event management services during 2008.
5. Cost of Charitable Activities
a)
b)
c)
d)
e)
f)
Grants
Annuities
Single Benevolent Grants
Residential Care Grants
Webb Fund Grants
Child Care Grants
Other Charitable Grants
Endowment
Funds
2008
£
Unrestricted
Funds
2008
£
Total
Funds
2008
£
Total
Funds
2007
£
1,104
1,104
90,248
360,359
8,269
12,805
4,259
475,940
90,248
360,359
8,269
12,805
5,363
477,044
92,612
382,200
13,022
15,095
4,468
507,397
Support costs allocated
1,104
Annual Report and Accounts 2008 Railway Benevolent Institution
73,566
73,566
58,159
549,506
550,610
565,556
17
Notes to the Accounts (Continued)
The majority of grants are made directly to individuals, but where possible Single Benevolent Grants
are sent to the third party providing the service and some Residential Care Grants are paid direct to
the care home. The principal type of grants and the circumstances in which they are made are as
follows:
a) Annuities
An annual monetary grant (paid quarterly) where a continuing need is identified. In 2008 198
Annuitants received a total of £90,248 (in 2007: 206 received £92,612). Periodically the Benefits
Committee review these awards to check that they remain applicable. As appropriate these may be
increased, reduced or suspended.
b) Single Benevolent Grants
As the name implies these are one-off grants to meet specific needs, for example to provide scooters
for the disabled or to meet outstanding bills. During 2008, 454 grants were made totalling £355,405
compared to 511 grants totalling £381,023 in the previous year, as set out below. Additionally there
were 48 outstanding pledges at the 31 December 2008, for which an accrual of £58,165 (2007:
£53,211) has been raised, increasing the total charged to the SOFA to £360,359.
2008 Grants
Convalescence
Equipment for the disabled
Funeral expenses
Debts & arrears
Minor house repairs
Household equipment
Other
No.
20
100
58
60
82
51
83
454
Change in accrual for pledges
TOTAL
2007 Grants
£
11,224
100,274
74,560
43,829
78,475
24,157
22,886
355,405
No.
22
99
59
81
81
71
98
511
4,954
454
360,359
£
12,265
99,070
74,089
47,681
89,053
38,476
20,389
381,023
1,177
511
382,200
c) Residential Care Grants
These are monthly payments to meet all or part of the shortfall between the actual costs of care /
nursing homes and the funding available from other sources. In 2008, four grants were made
totalling £8,269 (2007: six totalling £13,022). Similar to Annuities these are reviewed on a regular
basis.
d) Child Care Grants
These are one off payments to assist the parents of dependent children with, for example,
clothing/footwear, school projects and initial costs of entering higher education. During 2008, 14
families (24 children) received £5,363 (2007: 11 families (22 children) received £7,368). There were
no outstanding pledges at 31 December 2008 (2007: £nil).
e) Webb Fund Grants
As the name implies these grants continue the work of the Webb Orphans Fund which was
transferred into the RBI during 2002. They are quarterly payments to assist the parents of dependent
children where a continuing need has been identified. During 2008, 31 families (56 children) received
£12,805 (2007: 36 families (65 children) received £15,095).
Wherever appropriate the RBI works in co-operation with other bodies such as Social Services,
Citizens Advice Bureaux and other charities where this contributes towards the Institution’s objects.
In particular the RBI continues to work closely with the Soldiers, Sailors, Airmen and Families
Association (SSAFA) and Regimental Charities.
Annual Report and Accounts 2008 Railway Benevolent Institution
18
Notes to the Accounts (Continued)
6. Governance Costs
2008
£
2,109
1,206
1,179
11,563
16,057
Audit fees
Insurance
Other direct costs
Support costs
2007
£
2,051
2,237
4,013
10,330
18,631
Other direct costs for 2007 include continuing training costs for Board Members on the responsibilities
of trustees.
7. Fixed Asset Investments
a) Schedule of Investments
Investments held primarily to provide an investment
return to the charity
Listed investments at market value comprised:
UK Collective Investment Schemes
2008
£
2007
£
2,799,882
2,799,882
3,686,210
3,686,210
Following the transfer to Cazenove the investment portfolio was re-invested in UK Collective
Investment Schemes, more commonly referred to as pooled funds, to create a balanced portfolio
providing exposure to UK equities, international equities, UK bonds, hedge funds and property.
No investment in any individual security exceeded 5% by value of the portfolio.
b) Valuation
At 1st January 2008
Transfer
Disposal proceeds
Realised gains on investments
Unrealised losses on investments
At 31st December 2008
Endowment
Investments
£
Unrestricted
Investments
£
Total
£
659,186
53,629
(28,851)
6,304
(146,980)
543,288
3,027,024
(53,629)
(132,488)
26,184
(610,497)
2,256,594
3,686,210
(161,339)
32,488
(757,477)
2,799,882
Unrealised losses for unrestricted investments reported on the SOFA total £582,036. This comprises
the above losses of £610,497 less £18,085 in respect of Cazenove’s investment fees which have
been deducted from capital and £10,376 in respect of the exchange gain on the deposit account held
with the Allied Irish Bank.
Annual Report and Accounts 2008 Railway Benevolent Institution
19
Notes to the Accounts (Continued)
Endowment
Investments
£
Unrestricted
Investments
£
Total
£
Historical cost information is as follows:c) Cost
At 1st January 2008
Transfer
Disposals at cost
At 31st December 2008
658,830
53,629
(27,774)
684,685
3,025,385
(53,629)
(127,855)
2,843,901
3,684,215
(155,629)
3,528,586
d) Disposals at valuation
Disposal proceeds
Realised gains at cost
(22,547)
28,851
6,304
(106,304)
132,488
26,184
(128,851)
161,339
32,488
2008
£
2007
£
2,662
13,718
5,110
11,838
16,380
16,948
2008
£
2007
£
83,321
75,165
83,321
75,165
8. Debtors
Prepayments and accrued income
Other Debtors
9. Creditors: amounts falling due within one year
Accruals and deferred income
At 31 December 2008 creditors include an accrual of £58,165 (31 December 2007: £53,211) for
pledges made in respect of Single Benevolent Grants.
10. Contingent Liabilities
Annuities and Residential Care Grants are regular payments to provide on-going financial support.
The Board of Management however retain the option to discontinue future instalments. The awards
are reviewed periodically by the Benefits Committee to ascertain whether they are still required and
where appropriate, they are suspended.
At 31st December 2008 there were 195 Annuitants receiving quarterly payments of £24,100 (31
December 2007: 200 receiving £24,800 per quarter) and three in receipt of Residential Care Grants
totalling £640 a month (31 December 2007: four receiving £700 a month). Using life expectancy
tables these are estimated to represent potential future liabilities of £547,000 and 47,000 respectively
(31 December 2007: £611,000 and £50,000).
There were also 32 families receiving Webb Fund Grants at 31st December 2008 for which the
estimated annual payments total £13,000 (31st December 2007: 36 and £15,000).
Annual Report and Accounts 2008 Railway Benevolent Institution
20
Notes to the Accounts (Continued)
11. Statement of Funds
Balance
Incoming
at 1.1.08
Outgoing
Investment
Resources Resources
Balance
Gain/(Loss)
Transfers
at 31.12.08
£
£
£
£
£
£
3,250,714
427,847
(712,523)
(544,542)
22,272
2,443,768
67,518
2,157
(4,259)
(11,310)
-
54,106
3,318,232
430,004
(716,782)
(555,852)
22,272
2,497,874
605,893
19,971
-
(120,186)
(19,971)
485,707
Proprietary Annuities Fund
69,794
2,301
-
(13,844)
(2,301)
55,950
Langton Home Fund
25,963
856
(856)
(5,150)
-
20,813
7,539
248
(248)
(1,496)
-
6,043
709,189
23,376
(1,104)
(140,676)
(22,272)
568,513
4,027,421
453,380
(717,886)
(696,528)
-
3,066,387
Unrestricted Funds
General Reserve
Designated Funds
St Christopher’s Fund
Total Unrestricted Funds
Endowment Funds
Webb Fund
General Webster Wright Fund
Total Endowment Funds
Total Charity Funds
The general reserve represents the free funds of the charity which are not designated for other
purposes.
The St Christopher’s Fund has been designated by the Board of Management for the benefit of
dependent children. It was formed from the JS Forbes, LM Appeal Committee and G Bass Funds,
previously associated with St Christopher’s Railway Orphanage to provide for the care and
maintenance of children (including educational needs) and from legacies made by E Little and L A
Maffey in 1994/95 where the donors expressed a preference for the monies to be used for the benefit
of children.
The permanent endowment known as the Webb Fund is that portion of the net assets of the Webb
Orphans’ Fund which originated from monies bequeathed to the Fund at its inception in 1906 by
Francis William Webb, a former Chief Mechanical Engineer of the London and North Western
Railway Company. The Webb Orphans’ Fund was transferred to the RBI on 1st July 2002 in
accordance with Scheme 184397 made by the Charity Commissioners on 19 April 2002. No
restrictions were placed on the use of the income from the Webb Fund by the Commissioners, but
since its transfer the RBI’s Board of Management has continued to use the income in support of
children of railway families who are in need.
The Proprietary Annuities Fund is a separately registered Scheme, the Trustee of which is the
Institution. There are no restrictions on the use of the income deriving from this Fund within the
objects of the RBF, but as in previous years the income has been used to provide annuities.
The Langton Home Fund is a separately registered charity (No. 234581), of which the RBI was
appointed the Trustee by the Charity Commissioners on 5 January 1972. Income from this fund must
be used in support of children whose fathers have been killed or permanently disabled whilst working
on the railway, or failing that in support of any other children who are in need.
Annual Report and Accounts 2008 Railway Benevolent Institution
21
Notes to the Accounts (Continued)
The General Webster Wright Fund originates from a donation made by the London and North Eastern
Railway in 1942. The income from this fund must be used for the general care and educational
assistance of children of railwaymen.
Income from the Webb Fund and Proprietary Annuities Fund which is not restricted has been
transferred to unrestricted.
12. Analysis of Net Assets Between Funds
Unrestricted Funds
Endowment Funds
Webb Orphans’ Fund
Proprietary Annuities Fund
Langton Home Fund
General Webster Wright Fund
Total Funds
Investments
£
Current
Assets
£
Current
Liabilities
£
Total
Net Assets
£
2,256,594
324,601
(83,321)
2,497,874
464,156
53,467
19,890
5,775
543,288
21,551
2,483
923
268
25,225
-
485,707
55,950
20,813
6,043
568,513
2,799,882
349,826
(83,321)
3,066,387
Annual Report and Accounts 2008 Railway Benevolent Institution
22