The Benevolent Society of Blues Treasurer’s report to the 2022 AGM By Stephen Treharne........ Before starting my report, I must first put on record my and the Board’s extremely grateful thanks to Perry Kitchen for his skilfulstewardship as Treasurer of the BSB finances over very many years. His is a very hard act to follow and I am very grateful to Perry for agreeing to stay involved with the finance committee. His knowledge of the BSB finances is unrivalled. One effect of the pandemic is that, because it has been difficult to hold AGMs when the Board would ideally prefer, the November 2022 AGM is being asked to receive the Annual Report and Accounts for the year ended 30 June 2021. I will discuss with the Board how we might return to the position where AGMs are asked to consider accounts that are more recent in date. The accounts for the year ended 30 June 2021 are summarised as follows, starting with income and expenditure. INCOME 2021 - 2020 Subscriptions 31,903 - 32,807 Donations and legacies 40,382 - 73,839 Dividends and interest 90,162 - 70,585 TOTAL INCOME 162,447 - 177,231 EXPENDITURE 2021 - 2020 Assistance for older beneficiaries 2,195 - 1,650 Grants to other beneficiaries 23,177 - 19,081 Support grants for pupils 42,565 - 59,863 Loans unlikely to be recovered 20,334 - 12,674 Salaries and support costs 59,269 - 39,348 Governance costs 5,000 - 5,000 TOTAL EXPENDITURE 152,540 - 137,616 NET INCOMINGS 9,907 - 39,615 Net gains/(losses) on investments 555,847 - (144,905) NET MOVEMENT IN FUNDS 565,754 - (105,290) Total income at £162,447 was lower by nearly £15,000 when compared to 2020. The reduction is entirely accounted for by a decrease of over £33,000 in donations and legacies received. The BSB is always very grateful to receive donations and legacies, but particularly as regards legacies we cannot rely on this happening on a regular basis. This reduction, back to what might be considered a more normal level, was offset by a pleasing increase of nearly £20,000 in the income that we received from our investments. The third element of our regular income, subscriptions, fell slightly by about £900, continuing the generally downward trend of recent years. Total expenditure was £152,450, nearly £15,000 higher than in 2020. Assistance to beneficiaries, made by way of grant or other monetary support, but excluding loans advanced, totalled £67,937 as against £80,594 in 2020. Despite the year under review coinciding with perhaps the worst effects of the pandemic, we were surprised that we experienced a reduction in the number of applicants seeking help. We received 28 applications for assistance (2020: 46) and 19 (2020: 38) were met in part or in full. This year 2 individuals over the age of 60 (2020: 8 individuals) received help. The number of pupils helped increased to 38 (2020: 33), and this year’s help included the provision of laptops for online learning during Covid-19 lockdowns. This year we contributed £40,255 to the Additional Costs Fund (“the ACF”) which is administered by the school and used to support pupils on the highest levels of bursary by meeting necessary costs such as clothes and travel which the pupil/family cannot afford. We have continued with our recent policy of not making any payment to the school to fund a donation governorship as we consider, at the present time, that supporting the ACF enables us to help a greater number of pupils in a more immediate way. It should be recognised that not all the assistance we give involves money. This year 30 applicants (2020: 21) received advice and, in some cases, were referred to other agencies. A small number were visited at home. None of this work is reflected in the figures, but forms an important part of our work. It is greatly appreciated by those with whom we have contact: sometimes even just a friendly voice over the phone is all that is required. Recognising that the increasingly difficult financial climate bears more harshly on those in greatest need, it was considered prudent to make provisions of £20,334 (2020: £12,674) against our loan portfolio (which is discussed further below). Salaries, support costs and governance costs were £64,269, almost £20,000 higher than in 2020. The majority of this increase arose through the Board’s decision to incur expenditure of nearly £17,000 to bring the website and IT up to date after many years when little or nothing has been spent under this heading. The new website, which will be further developed, allows applications for assistance to be made and reviewed online, safely and confidentially, and represents a quantum leap forward in the way in which we interact with applicants. Further modernisation of our IT is planned. Overall, there was surplus in 2021 of £9,907, some £29,700 lower than in 2020. The balance sheet as at 30 June 2021 can be summarised as follows: FIXED ASSETS 2021 - 2022 Investments 3,882,013 - 3,326,166 CURRENT ASSETS 2021 - 2022 Loans 80,316 - 122,269 Cash balances 96,859 - 39,839 Debtors 26,462 - 29,400 LIABILITIES 2021 - 2022 Creditors (11,604) - (9,382) NET ASSETS 4,074,046 - 3,508,292 FUNDS 2021 - 2022 Unrestricted 2,328,126 - 2,012,362 Restricted 1,745,920 - 1,495,930 TOTAL FUNDS 4,074,046 - 3,508,292 Our endowment and non-endowment portfolios remain invested in a range of funds across a number of different sectors. The portfolio is rebalanced from time to time. Surplus cash is invested where possible, and when necessary investments are sold to generate cash to meet day to day requirements. Over the year 2020/2021 the net effect of changes to our investments, including a pleasing increase in the overall value of our holdings, reflecting global stock market movements, resulted in our investments increasing by nearly £556,000 to £3,882,013. The total return (capital and income) on our investments has been calculated at nearly 21% which compares favourably with the increase of 23% in the FTSE All World Index over the same period. The book value of our loan book continues to fall. This is a product of (1) a move over time by the Grants and Loans Committee towards only granting interest free loans where there is a realistic chance that repayment will be made, (2) a more systematic approach to seeking repayment of outstanding loans, and (3) a prudent approach to providing against loans where repayment is either uncertain or is likely to be protracted. In 2021, 4 new loans of £6,950 were advanced, a significant decrease from 2020 when 10 new loans totalling £17,545 were advanced. Repayments of loans in 2021 totalled over £28,000, virtually unchanged from 2020. Net provisions made against the loan book were £20,334, a 60% increase over 2020. The overall effect was to reduce the value of the book from £122,269 to £80,316. Cash balances increased significantly during the year. It has been agreed that cash of around 2% of our total assets should be held in cash to reduce the need to realise relatively small amounts of cash at short notice. Overall, in 2020/2021 our reserves increased by £565,754 to £4,074,046, the first time that the £4 million threshold has been passed. In this brief report I have not been able to cover every aspect of the BSB’s work and much more detail, including financial information, is given in the full Trustees Annual Report and Accounts which has been filed with the Charity Commission. There were changes during the year under review in the composition of the Finance Committee. In September 2020 I joined the Committee together with Mark Hutton. Two long serving members of the Committee stepped down in November 2020. Roger Eades and Keith Mills acted as members of the Committee for many years, bringing their extensive knowledge and experience to the stewardship of the BSB’s investments. On behalf of the BSB I would like to thank them for everything that they have done. Stephen Treharne FCA 9 September 2022
The Annual Accounts of 2021 can be found here: