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Financial Report

 


Annual Report and Statement of Accounts
for the Independent Living (1993) Fund
for the year ended 31 March 2002

 



PAGE   CONTENTS
   
1   Trustees' report
7   Statement of Trustees and Chief Executive's responsibilities
9   Statement on the system of internal control
13   Auditor's report
15   Statement of accounts
18   Notes to the accounts

 

Independent Living (1993) Fund

Trustees' Report for the Year ended 31 March 2002

Independent Living Funds appointed Trustees

Sydney Shore CBE (Chairman)
Retired banker. A career banker who retired as a General Manager of Lloyds TSB plc. Involved in fund raising, social and church activities and was formerly a Vice Chairman of a large NHS Trust.

John Shepherd OBE (Treasurer/Vice-Chairman)
Chartered Accountant. Commercial Finance Director with extensive experience in manufacturing industry and disability. Has worked with and for the disabled as a Director of Remploy - the country's largest employer of disabled people.

Margaret Cooper
Solicitor. Chairman of The Appeals Tribunal, including disability appeals tribunals. Chairman of industrial tribunals and fair employment tribunals. 

Anne Davies OBE
Chairman: Centre for Accessible Environments. Consultant on disability issues with an NHS Trust. Author and broadcaster.

William Morrison CBE
Chartered Accountant, formerly Deputy Senior Partner of KPMG. Has held non-executive directorships in listed companies, and similar appointments in other bodies over a period of years.

Adrian V Stokes OBE
Chief Executive, CAT Ltd. Vice-President of the Disabled Drivers' Motor Club and the Royal Association for Disability and Rehabilitation. Governor of Motability. Member of Disability Appeal Tribunals. Non-Executive Director of Barnet Primary Care Trust and of the National Clinical Assessment Authority.

Thomas Begg
Management consultant in health & social care. Retired Director of Social Services. Former assistant honorary secretary to the Association of Directors of Social Services. Former Social Services Adviser to the Assembly of Welsh Counties and to the Welsh Local Government Association.

The Trustees do not receive any remuneration, but are reimbursed for out-of-pocket expenses. There are no other unpaid persons or volunteers upon whose services the Fund is dependent.

Sub-committees

a) A Referrals Panel consisting of the Chairman plus one other Trustee, rotating on a monthly basis, considers in the first instance individual cases referred by the Chief Executive where she considers this is appropriate.

b) An Audit Committee consisting of William Morrison (chairman), Margaret Cooper and John Shepherd is responsible for ensuring operational co-operation between auditors and the Fund's Accounting Officer and staff, for assessing the outcome of external and internal audits, and dealing with risk management and corporate governance issues.

c) A Salaries Committee consisting of John Shepherd (chairman), Margaret Cooper and William Morrison is responsible for recommending senior staff salaries and changes to the general pay scales for directly employed staff, taking into consideration rates of pay in the Benefits Agency.

Chief Executive appointed by the Trustees and Accounting Officer as designated by the Principal Accounting Officer for Work and Pensions

Mrs Elaine Morton

Auditor 

Comptroller and Auditor General 
National Audit Office 
157-197 Buckingham Palace Road
London SW1W 9SP 

Solicitors

Eversheds
115 Colmore Row
Birmingham B3 3AL

Bankers

Lloyds TSB Commercial
Butt Dyke House
33 Park Row
Nottingham NG1 6GZ

Objectives 

The Independent Living (1993) Fund, generally referred to as "the 93 Fund", was set up in April 1993 to provide financial help for disabled people throughout the UK. Its awards are in the form of regular monthly payments to enable people to pay for personal assistance.

The Fund is mainly financed by central government through the provision of grants in aid and is constituted as a discretionary trust fund. The Secretary of State for Work and Pensions (formerly the Secretary of State for Social Security) appoints seven Trustees of the Fund. The same Trustees are responsible for the Independent Living (Extension) Fund, generally referred to as "the Extension Fund", which is a charity having similar financing and objectives, but which does not accept new applications.

The Trust Deed

The Trust Deed of the 93 Fund determines who is eligible for its help. A successful applicant must:

 be at least 16 and under 66 years of age

 receive the highest care component of the Disability Living Allowance

 be able to live independently in the community for at least six months

 have savings of less than £8,000 (revised upwards to £18,500 from April 2002)

 have an income which is insufficient to cover the cost of the care needed

 be assessed by the local authority as being at risk of entering residential care, or capable of leaving it to live in the community

 receive at least £200 worth of direct payments and/or services per week from the local authority (net of any charge), and

 be assessed as needing additional care

The Trust Deed also determines certain restrictions upon how awards may be spent, and the maximum weekly payment that can be made to any client. The maximum weekly payment has been £375 since January 2000 and has been increased to £395 from April 2002.


Organisation and administration

The Fund’s premises are in Block 6, Government Buildings, Chalfont Drive, Nottingham, NG8 3RD. The equivalent of 106 full-time staff administers both the 93 Fund and the Extension Fund. In addition 62 (based on an annual average) self-employed visiting social workers carry out assessments for both Funds.

The Fund seeks to employ disabled persons where they meet the criteria advertised for the post, and will make all adjustments possible within reasonable limits of resources and business needs to meet the terms of the Disability Discrimination Act.

The partnership with local authorities marks the main difference between the 93 Fund and the original Independent Living Fund (although there are also differences in eligibility criteria and financial limits). Disabled people must have the support of their local social services department in making an application to the Fund.

The Fund publishes its basic information leaflet in ten languages, large print, Braille and talking tape.

Review of developments

A total of 2,690 new applications were received during the year, compared with 2,740 during 2000-01. By the end of March 2002, 8,060 people were receiving awards from the 93 Fund and the average weekly award was £227 per week, compared with 7,114 people receiving an average £212 per week at March 2001. The most prevalent primary disabilities amongst clients of the Fund are severe learning difficulties (29%), multiple sclerosis (16%), cerebral palsy (15%), spinal injury (7%), and brain damage (5%).

There has been an increase in staff to cope with increased numbers of clients and with a revised Revisit process. New procedures were evaluated in March 2001; the Fund will in future ensure that clients are revisited at two-yearly intervals to enable a full review of care needs leading to an up to date offer of financial assistance. A move to new premises will take place during the next financial year to accommodate additional staff being employed to improve customer service and payment security.

A government “Quinquennial Review” was carried out during the year, and a report was published in December 2001 (copies available on request, or visit the website - www.ILF.org.uk). The report recommended that the Fund continues in its present form but with a revised capital limit for qualifying applicants (increased from £8,000 to £18,500) and full disregard of clients’ and partners’ earnings in the assessment of ability to pay towards care costs (replacing the January 2000 change of a sliding scale applied to earnings over £30 per week and full account of earnings over £200 per week).

These changes, together with an increase in the maximum weekly payment from £375 to £395 approved by the Minister for Disabled People, take effect from April 2002. A number of other recommendations were made in the report to improve the service provided to clients, and these will be followed up during the next year.

The Fund has Contact Officers in all Social Services Departments in Great Britain and Health and Social Services Boards in Northern Ireland for dissemination of information and advice about the Fund. Information seminars were held throughout the year, and the Fund has also responded to individual requests for talks to social workers and disability groups on the operation of the Fund.

Regional meetings were held for Visiting Social Workers during the year. Fund staff attended to enable discussion of issues arising from the Revisit process.

A Client User Group was set up during the year with clients from counties close to the Fund’s offices; a number of meetings have been held, and the group has made valuable contributions to administrative issues such as the Fund literature.

A complaints procedure has also been introduced which allows us to monitor where we may be able to improve our service.

The website (www.ILF.org.uk) was set up in April 2001, and has been revised during the year to include major publications such as the quinquennial review and to provide answers to frequently asked questions.

Financial position

The 93 Fund and Extension Fund are jointly financed, mainly out of money voted by Parliament as grants in aid for the purpose of making regular grants to individuals. 99.9% of the £155.9 million grant in aid available for this year has been drawn on for clients of the two Funds.

The Fund is committed to prompt payment of bills for goods and services received. Payments are normally made within the period specified in the contract. Where there is no contractual or other understanding, they are paid within 15 days of the receipt of the goods or services, or presentation of a valid invoice or similar demand, whichever is later. 97.5% of invoices paid in the year met this target.

The Fund does not hold reserves for any purpose. Assets are held only for the purpose of managing the Fund. The Trust Deed provides that the Trustees: (i) can borrow only with the specific agreement of the Secretary of State; (ii) cannot lend; (iii) cannot issue guarantees or indemnities; (iv) can invest Fund moneys in interest-bearing accounts.

The statement of accounts presented with this report has been prepared in accordance with an agreement made between the Trustees and the Secretary of State for Work and Pensions.

Mrs Elaine Morton, Chief Executive

Sydney Shore CBE, Chairman

John Shepherd OBE, Treasurer/Vice Chairman

 

Statement of Trustees' and Chief Executive's Responsibilities

In accordance with the Trust Deed, the Secretary of State for Work and Pensions appoints the Trustees of the Fund. The Trustees are required to appoint, with the approval of the Secretary of State, a full time official to be known as the Chief Executive.

Under the Trust Deed and the consequential agreement between the Trustees and the Secretary of State, the Trustees are required to prepare a statement of accounts for every accounting period (financial year) in the form agreed with the Secretary of State. The accounts are prepared on an accruals basis and must give a true and fair view of the income and expenditure and state of affairs of the Fund.

In preparing the accounts, the Trustees are required to:

observe all relevant guidance given in "Government Accounting" and the Treasury booklet "Trading Accounts: A Guide for Government Departments and Non-Departmental Public Bodies" as amended from time to time;

ensure that every statement of accounts shall meet best commercial accounting practices including Accounting Standards issued or adopted by the Accounting Standards Board, and Statements of Recommended Practice, insofar as they are appropriate to the Fund and are in force for the financial period for which the statement of accounts is prepared;

prepare a Trustees' report (to be included with the statement of accounts), which confirms that the accounts have been prepared in accordance with the agreement made with the Department for Work and Pensions.

The Trustees, with the assistance of the Chief Executive, are required to apply accounting practices and financial systems to the administration of the Trust so as to enable them to:

monitor and take reasonable steps to ensure compliance with the terms and conditions upon which money has been paid to and accepted by the Trustees as part of the Trust Fund;

monitor and take reasonable steps to ensure that expenditure in any financial year does not exceed the programme, budgets and forecasts in respect of that financial year and the amount of public funds provided by way of grant made to the Independent Living (1993) Fund for that financial year;

take reasonable steps to safeguard against fraud and theft;

keep and maintain books, records and accounts and apply accountancy practices and financial systems which fully and properly record all money received and paid respectively by and on behalf of the Trustees for the purposes of the Trust.

The Trustees and the Chief Executive are responsible for effective control of the full range of issues related to corporate governance. A separate statement is provided on the system of internal control.

 

Mrs Elaine Morton, Chief Executive

Sydney Shore CBE, Chairman

John Shepherd OBE, Treasurer/Vice Chairman

 

Statement on Internal Control for Year ending 31 March 2002

Accounting Officer’s responsibilities

As the Accounting Officer I have responsibility for maintaining a sound system of internal control that supports the achievement of the Funds’ policies, aims and objectives set by both the Department for Work and Pensions (formerly the Department of Social Security) and the Trustees of the Funds, whilst safeguarding the public funds and the Fund’s assets for which I am personally responsible, in accordance with the responsibilities assigned to me in Government Accounting.

The Board of Trustees also has responsibility for maintaining a sound system of internal control and for reviewing its effectiveness. The regular reporting to the Trustees of the work undertaken to assure myself that the system of internal control is working effectively means that there is no separation or difference between the mechanisms the Board and I use in this assurance process.

I acknowledge my separate Accounting Officer responsibilities to Parliament in particular my responsibility for taking action as set out in paragraphs 14 to 18 of the Non Departmental Public Bodies Accounting Officer Memorandum should the Trustees contemplate a course of action involving a transaction which I consider would infringe the requirements of regularity or propriety or which does not represent prudent or economical administration, efficiency or effectiveness. I also acknowledge that no Trustee individually or the Board of Trustees collectively are permitted to give me instructions which conflict with my duties as the Fund’s Accounting Officer. During the period under consideration neither situation arose. Therefore it is proper to set out a joint statement on internal control within the Fund between the Board of Trustees and myself as Accounting Officer. 

Commitment to effective internal governance

The Fund is sponsored as a Non Departmental Public Body (NDPB) by the Department for Work and Pensions and operates by a Trust Deed set up by the Secretary of State which means that some aspects of internal governance are dependent on activity within the Department. Regular liaison is developing to assess and manage any associated risk within this structure. 

The Board of Trustees and I acknowledge that the control environment, which is within our direct influence, is being strengthened and there is full commitment to continuous improvement. The Board of Trustees recognise that robust risk management systems are crucial to the effective management of the Fund’s activities. The Board of Trustees is committed to achieving a high standard of internal governance to meet compliance with DAO (Gen) 13/00 (HM Treasury’s corporate governance requirements for central government and NDPBs).


The following statement on internal control covers the financial period of the accounts and up to the date of their approval.

Internal Control

The Board of Trustees has a responsibility for the Fund’s system of internal control and for reviewing its effectiveness working closely with myself as Chief Executive. The system of internal control is designed to meet the Funds particular needs and the major risks faced in failing to meet objectives and manages rather than eliminates the risk of failure. In pursuing objectives internal controls can only provide reasonable and not absolute assurance of effectiveness.

A process for identifying and evaluating the nature and extent of those risks, and a system to manage them efficiently, effectively and economically has been put in place during this accounting year. This process is based on the methodology used by the Department for Work and Pensions.

The system of internal control is based on a framework of management processes including policies, management information, financial regulations, administrative procedures and a system of delegation and accountability.

Risk management has been included in the strategic and business planning process. The senior management team now considers risk management and internal control on a regular basis during the year collating and documenting progress on the key risks.

Other key controls in the system include

· an appropriate Organisational structure to support the processes,

· Personnel policies to underpin Funds work,

· comprehensive budgeting systems with an annual budget approved by Trustees in consultation with our sponsoring government Department, 

· regular financial reports tracking actual expenditure against forecasts,

· a robust procurement policy, process and review to ensure continued best value for money,

· a developing comprehensive approach to controls on service delivery and security.


The Fund does not have its own Internal Audit function. My review of the effectiveness of the system of internal control is informed by regular reviews with Senior Managers, progress reports on key projects, my reporting to the Audit Committee and any comments made by them in minutes of meetings and other reports, the work of DWP Internal Assurance Services (IAS) and any comments made by external auditors in their management letter and other reports. 

The Board’s understanding of the risks to the delivery of the Fund’s objective and their review of the effectiveness of the system of internal control is informed by reports from the Chairman of the Audit Committee.

Role Of the Audit Committee

The Board of Trustees has established some key procedures and policies to begin to review the effectiveness of the system of internal control. This work is conducted through the Audit Committee and includes

· reviewing the effectiveness of the risk management process including receiving and agreeing a register of the Fund’s key risks, 

· the Chief Executive reporting regularly on the development and maintenance of the internal control framework as well as the effectiveness of the management of risks,

· reviewing the external and DWP Internal Assurance Services (IAS) work plan,

· considering reports from management, DWPIAS and external audit on the system of internal control and any material control weaknesses in their management letters,

· discussing with management the actions to be taken on any problem areas identified by the Audit Committee or in external or DWPIAS audit or governance reports, 

· the Chairman of the Audit Committee reporting the outcome of the Audit Committee meetings to the Board and the Board receiving the minutes of all the meetings. 


The Board’s review of the internal control statement

Before producing this statement the Board, through the Audit Committee, has reviewed the following

· the commitment to maintaining good governance practices in those areas which are within the exclusive remit of the Trustees, 

· that all requirements under the Funds constituting documents (Trust Deed, Conditions Of Grant Agreement and Financial Memorandum) are being complied with,

· any instances of fraud, malpractice or significant losses have been reported,

· that the Funds are compliant with all relevant laws and regulations or that any known breaches are being rectified,

· the actual processes used to identify, assess and manage risk are operating effectively,

· the internal controls are appropriate and remedial action has been implemented on areas of identified control weakness,

· any other issue impacting on internal control is reported.

Best Practice and improvement 

There is a commitment to ensure that the development of our internal control practices keeps pace with the changing environment in which the Fund is operating. It is recognised that there should be up to date identification and recording of risks facing the organisation. 

The basis of a comprehensive risk and control assessment process at management and Trustee level has been established. Further work will be in place before reporting on the year ending 31 March 2003 to fully and rigorously implement Treasury guidance. This takes account of the time needed to fully embed the processes which have been established, improve their robustness and strengthen the reporting processes so that the Board is regularly assured that controls remain adequate and are working effectively.

Mrs Elaine Morton, Chief Executive



The Certificate of the Comptroller and Auditor General to the Trustees of the Independent Living (1993) Fund

I certify that I have audited the financial statements on pages 15 to 25 which have been prepared under the historical cost convention as modified by the revaluation of certain fixed assets and the accounting policies set out on page 18 to 19.

Respective responsibilities of the Trustees and the Chief Executive
and of the Auditor

As described on pages 7 to 8 of the Trustees Report, the Trustees and the Chief Executive are responsible for the preparation of the financial statements and for ensuring the regularity of financial transactions. The Trustees and the Chief Executive are also responsible for the preparation of the other contents of the Annual Report. My responsibilities, as independent auditor, are guided by the Auditing Practices Board and the auditing profession's ethical guidance.

I report my opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with the agreement between the Trustees and the Secretary of State for Work and Pensions and whether in all material respects the expenditure and income have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them. I also report if, in my opinion, the Trustees Report is not consistent with the financial statements, if the Fund has not kept proper accounting records, or if I have not received all the information and explanations I require for my audit.

I review whether the statement on pages 9 to 12 reflects the compliance with Treasury's guidance 'Corporate governance: statement on internal control'. I report if it does not meet the requirements specified by Treasury, or if the statement is misleading or inconsistent with other information I am aware of from my audit of the financial statements.

Basis of audit opinion

I conducted my audit in accordance with United Kingdom Auditing Standards issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts, disclosures and regularity of financial transactions included in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Trustees and Chief Executive in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Fund’s circumstances, consistently applied and adequately disclosed.

I planned and performed my audit so as to obtain all the information and explanations which I considered necessary in order to provide me with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by error, or by fraud or other irregularity and that, in all material respects, the expenditure and income have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them. In forming my opinion I have also evaluated the overall adequacy of the presentation of information in the financial statements.

Opinion

In my opinion:

· the financial statements give a true and fair view of the state of affairs of the Independent Living (1993) Fund at 31 March 2002 and of the net movement of funds, total recognised gains and losses and cash flows for the year then ended and have been properly prepared in accordance with the agreement of the Secretary of State for Work and Pensions; and 
· in all material respects the expenditure and income have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them. 

I have no observations to make on these financial statements.

John Bourn
Comptroller and Auditor General

National Audit Office
157-197 Buckingham Palace Road
Victoria
London SW1W 9SP

21 June 2002

 

Independent Living (1993) Fund Statement of Accounts

Statement of Financial Activities for the Year ended 31 March 2002

Notes Restricted and endowment
Funds 2001-2002
Restricted and endowment
Funds 2000-2001
Incoming resources £ £
Activities in furtherance of the trust's objectives 4a 83,347,883 67,140,421
Bank interest 160,454 151,878
Other income 4b 1,570,589 1,177,447
Total incoming resources 85,078,926 68,469,746
 
Resources expended
Direct charitable expenditure:
Grants to individuals 5 (80,306,661) (66,164,908)
Management and administration 6 (3,536,988) (2,701,983)
Total resources expended (83,843,649) (68,866,891)
Net incoming/(outgoing) resources 1,235,277 (397,145)
Balances brought forward at 1 April 2001 1,319,787 1,716,932
Balances carried forward at 31 March 2002 2,555,064 1,319,787

All gains and losses are included in the Statement of Financial Activities.

The net movement in funds arises wholly from continuing activities.

The notes on pages 18 to 25 form part of this account.

 

 

Balance Sheet as at 31 March 2002

Notes  31 March 2002 31 March 2001
Fixed Assets £ £
Tangible fixed assets 7 315,811 363,635
Current Assets
Debtors 8 3,085,959 3,665,240
Cash at bank and in hand 9 2,239,253 956,153
5,325,212 4,621,393
Current Liabilities    
Amounts falling due within one year 10 (3,085,959) (3,665,241)
Net Current Assets 2,239,253 956,152
Total Assets less Current Liabilities 2,555,064 1,319,787
 
Fund Balances:
Endowment Trust Fund 4 124 122
Restricted income funds allocated to:
Grants to individuals 4 2,111,377 843,379
Management and administration 4 127,752 112,651
Restricted capital funds 4 315,811 363,635
2,555,064 1,319,787

The notes on pages 18 to 25 form part of this account.

Mrs Elaine Morton, Chief Executive

Sydney Shore CBE, Chairman

John Shepherd OBE, Treasurer/Vice Chairman


These accounts were approved by the Trustees on 12 June 2002

 

 

Cashflow Statement for the Year ended 31 March 2002

Notes  2001-2002 2000-2001
Operating activities £ £
Grants in aid received 4 83,927,000 66,048,100 
Other cash receipts 11a 1,646,233 1,395,398
Payments to individuals 5 (80,978,002) (65,305,889)
Other operating cash payments 11b (3,388,362) (2,587,231)
Net cash inflow/(outflow) from operating activities 11c 1,206,869 (449,622)
Returns on investments and servicing of finance
Interest received 11d 157,584  172,902
Investing activities
Acquisition of fixed assets (81,393) (122,743)
Sale of fixed assets 40 448
Net cash (outflow) from investing activities (81,353) (122,295)
Increase/(decrease) in cash and cash equivalents 1,283,100 (399,015)
------------------------------------------------------------------------------------------------------------------------
Reconciliation of Net Cash Flow to Movement in Net Debt
(see note 11e)
2001-2002 2000-2001
(restated)
£ £
Increase/(decrease) in cash 1,283,100 (399,015)
Net funds at 1 April 2001 956,153 1,355,168
Net funds at 31 March 2002 2,239,253 956,153

Prior year figures have been restated to remove items incorrectly included as capital instruments, current asset investments and fixed asset investments.

The notes on pages 18 to 25 form part of this account

 

Notes to the Accounts

1 Nature and purpose of funds

The Trust Fund was established on 25 February 1993 with an initial endowment of £100 from the Secretary of State for Work and Pensions (previously the Secretary of State for Social Security). This money is held in perpetuity with any interest earned being added to the original sum.

The main source of funding is grants in aid from the Department for Work and Pensions (previously the Department of Social Security) and the Department for Social Development (previously the Department of Health and Social Services). This funding is given under the terms of an annual conditions of grant agreement between the Secretary of State and the Trustees, restricted as to use in order to provide assistance with the cost of personal and domestic care to disabled applicants meeting the terms of the Trust Deed and to meet the management and administration costs and capital costs of the Fund. There are no unrestricted funds.

All assets and liabilities revert to the Secretary of State for Work and Pensions in the event of the closure of the Fund.

2 Accounting convention

The accounts are prepared under the historical cost convention, and in the form agreed between the Trustees of the Fund and the Secretary of State. Without limiting the information given, the accounts also meet the applicable requirements of the Charities (Accounts and Reports) Regulations 1995 (SI 1995 No 2724), the Statement of Recommended Practice revised in 2000 for Accounting by Charities (SORP 2000) issued by the Charity Commissioners, the accounting standards issued and adopted by the Accounting Standards Board, and supplementary guidance on public sector accounting issued from time to time by Her Majesty's Treasury.

3 Accounting policies

The following policies have been used consistently in dealing with items which are considered material to the Fund's accounts:

a) Grants in aid received

Funding to cover grants to individuals and management and administration expenses is provided through grants in aid from the Department for Work and Pensions and the Department for Social Development. Grants in aid are received on the basis of the Fund's estimated cash payments during the financial year. Grants in aid received for capital expenditure are explained in note (e) below.

Since these accounts are prepared on an accruals basis the grants in aid received (see note 4) are adjusted to reflect accruals at the beginning and end of the year. The balances at the end of the financial year reflect indebtedness between the Fund and the Departments, which will be met through the cash provisions in the following year.

b) Grants to individuals

Grants to individuals are discretionary grants made within the terms of the Trust Deed. Payments are made every four weeks in arrears, and grants due but unpaid at 31 March are accrued for in these accounts. 

Where grants are returned in whole or in part, the refunds are brought to account at the date of receipt. Potential refunds are not accrued for. Grants to individuals are shown net of refunds in these accounts.

c) Management and administration

The Secretary of State has agreed to allow this Fund to provide an administration service for the Independent Living (Extension) Fund and to charge an administration fee. Accordingly both Funds are administered jointly by staff employed by the Trustees of this Fund. All management and administration costs for both Funds are borne in full by this Fund, which recovers an agreed administration fee.

Services provided free by the Benefits Agency, such as site messengers and courier service, are included at nil cost as it is impracticable to estimate a value and the amount is unlikely to be material. 

d) Fixed assets and depreciation

Assets costing £500 or more individually or as grouped assets are capitalised in these accounts in the year of acquisition, and are valued at historical cost. Fixed assets given to the Fund by the Department for Work and Pensions at nil cost on 1 April 1993 are recorded at nil value in these accounts. All assets are recorded in a fixed assets register to facilitate proper control. Depreciation is charged on a straight line basis over the estimated useful life of each asset, commencing in the year following its acquisition.

Fixed assets are depreciated over the following expected lifespans:

- Furniture 10 years
- Office equipment 5 years
- IT hardware 5 years
- IT bespoke software 3 years

Under the administration arrangements described at 3c, this Fund purchases all assets necessary for the administration of both Funds.

e) Capital expenditure

Funding for capital acquisitions is included in the grants in aid and in accordance with SSAP 4 and the SORP (Accounting by Charities), is allocated to a separate restricted capital fund. Amounts are transferred from this fund to restricted income funds (management and administration) to match the related annual depreciation charges over the expected useful lives of the associated fixed assets and to match any losses on disposal of items with a remaining net book value (see notes 4 and 7).

4 Analysis of restricted funds

Restricted income funds allocated between: Restricted capital funds Endowment Trust Fund Total 2001-2002 Total 2000-2001
Grants to individuals Management &
administration
£ £ £ £ £ £
Grants in aid received (a) 82,246,000 1,599,607 81,393 - 83,927,000 66,048,100
Grants in aid: (debtor) at 1 April 2001 (a) (3,381,556) (255,793) - - (3,637,349) (2,545,028)
Grants in aid: debtor at 31 March 2002 (a) 2,710,215 348,017 - - 3,058,232 3,637,349
Grant income 81,574,659 1,691,831 81,393 - 83,347,883 67,140,421
Bank interest - 160,452 - 2 160,454 151,878
Other income (b) - 1,570,589 - - 1,570,589 1,177,447
Transfers between funds (c) - 129,217 (129,217) - - -
Funds available 81,574,659 3,552,089 (47,824) 2 85,078,926 68,469,746
Expenditure (see notes 5 & 6) (80,306,661) (3,536,988) - - (83,843,649) (68,866,891)
Net movement in funds 1,267,998 15,101 (47,824) 2 1,235,277 (397,145)
Funds brought forward  at 1 April 2001 843,379 112,651 363,635 122 1,319,787 1,716,932
Funds carried forward  at 1 March 2002 2,111,377 127,752 315,811 124 2,555,064 1,319,787

All funds held by the Fund are restricted funds for the purpose of making grants to individuals and for meeting the related management and administration costs. Restricted capital funds are held for the purpose of fixed asset acquisitions and related depreciation and disposals in accordance with the policy described in note 3(e). The endowment trust fund consists of the original endowment and any bank interest earned on the sum, and is held in trust. The only arrangements for the transfer of funds are those detailed in note c below.

(a) Grants in aid summary

                                             Received             (Debtor)            Debtor               Total               Total     
                                                           2001-2002      1 April 2001  31 Mar 2002    2001-2002     2000-2001  
                                                                             £                        £                       £                     £                    £    
                
Department for Work
                        and Pensions             81,742,000     (3,558,018)       2,983,631      81,167,613     65,491,169
                Department for Social
                         Development                2,185,000          (79,331)            74,601        2,180,270        1,649,252
                                                                  ------------           -----------            -----------          ------------         ------------

                 Totals     
                               83,927,000     (3,637,349)      3,058,232      83,347,883     67,140,421
                                       
                  ==========================================================


Grants in aid are provided from the Consolidated Resource Accounts of the above Departments.

Debtors at 1 April 2001 match grants to individuals and management and administration payments made during the year in respect of the previous financial year and prepayments made during the previous year in respect of this year.

Debtors at 31 March 2002 match unpaid grants to individuals and management and administration expenditure due for the current financial year shown as creditors in the balance sheet at 31 March 2002, and prepayments made in this financial year in respect of the following financial year included as debtors in the balance sheet at 31 March 2002.

(b)       Other income summary  

2000-2001 1999-2000 
£     £
Administration fees   1,570,489 1,177,327
Profit on disposal  20  6
 Other income   80    114  
Total other income 1,570,589    1,177,447

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      Administration fees are paid by the Independent Living (Extension) Fund for the attributed and apportioned management and administration costs of that Fund (see note 3c).

(c) Transfers between funds

As explained in note 3e, funding is transferred from restricted capital funds to match the depreciation charge for the year and losses on disposal of capital assets (£129,217 in total for this year and £120,872 for 2000-2001 - see note 6).

5 Grants to individuals (see note 3b)

2001-2002 2000-2001
£  £ 
Payments made in year 80,978,002  65,305,889
(Creditors) at 1 April 2001  (3,381,556)  (2,522,537)
Creditors at 31 March 2002 2,710,215 3,381,556
Grants payable for year 80,306,661    66,164,908
Number of individuals in receipt of payments  8,310     7,354

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   6 Management and administration

2001-2002 2000-2001
 £   £ 
Directly employed staff:
Gross pay 1,811,531 1,253,939
Employer's National Insurance contributions   1 55,290 107,327
Employer's contribution to pension schemes and insurances (see note 12)  1 47,06  101,892
Total direct salary costs   2,113,882 1,463,158
Seconded staff   - 54,269  
Agency staff 42,883  5,207
Total staff costs (see note a)    2,156,765 1,522,634
Trustees' expenses 15,961 12,903
Computer running costs   52,650 83,790
Postage, printing and stationery 161,299 137,992
Accommodation and utilities (see note b)   153,738 135,359
Visiting social workers’ fees and expenses 587,523  375,699
Auditor's remuneration  35,250 35,250
Depreciation 127,611 110,004
Losses on disposal (see note b) 1,585 10,426
Services, communications, training, etc   244,606    277,926
Total costs  3,536,988     2,701,983

                                                                                                                                                                                                                                                                                                                                                                        
The Fund is exempt from paying Corporation Taxation under the provisions of paragraph 505 of the Income and Corporations Tax Act 1988.

(a) Emoluments paid to senior staff having authority or responsibility for directing or controlling the major activities of the Fund are:

Band    Name and position
  
£40,000 - £45,000    Elaine Morton (Chief Executive)
£30,000 - £35,000    Trevor Chapman (Operations Director)
   Gillian Smith (Personnel Director)
   Gary Stephenson (Finance Director)
£25,000 - £30,000    Jacky Fisher (Social Work Director)
£15,000 - £20,000    Ann Kestenbaum (Research Director)

                                                                                                                                                                                                                                                 
Jacky Fisher and Ann Kestenbaum work for the Fund on a part-time basis. The Fund pays an amount equivalent to 8% of gross salary into a “defined contributions” group pension scheme (see note 12).

An average of 106 directly employed staff (85 directly employed staff and 1 seconded staff in 2000-2001) were employed to administer this Fund and the Independent Living (Extension) Fund (see note 3c). Part time staff are included in proportion to hours worked.

(b) A move to a new site is planned in 2002-03, and this will result in higher accommodation charges in the next financial year; there will also be associated losses on disposal of fixed assets (see note 7).



7 Fixed assets

Furniture Office IT hardware Total  Total
(see note b) equipment  and software 2001-2002 2000-2001
COST £ £ £ £ £
Balance at 1 April 2001 81,036 19,428 483,585 584,049 537,409  
Additions in year 21,860 15,992 43,541 81,393 122,743
Disposals in year   (4,788)      (2,644)    (2,348)    (9,780)    (76,103)
Balance at 31 March 2002   98,108     32,776    524,778    655,662     584,049
DEPRECIATION
Balance at 1 April 2001 24,684 7,972 187,758 220,414 175,645
Charge for the year (see note a) 8,104 3,557 115,951 127,612 110,004
Disposals in year (3,383)    (2,444)    (2,348)    (8,175)    (65,235)
Balance at 31 March 2002 29,405    9,085    301,361    339,851    220,414
NET BOOK VALUES
At 31 March 2002  68,703 23,691 223,417 315,811 363,635  
At 1 April 2001 56,352 11,456 295,827 363,635 361,764

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Depreciation for the year is based on historical cost at the start of the year (see note 3d).

(b) A move to a new site is planned in 2002-03, and as part of the accommodation service contract between the Department for Work and Pensions and LandSecurities Trillium, all current furniture assets will be transferred to LandSecurities Trillium at nil cost; this will be shown as disposals in the next financial year, and the related losses on disposal will be borne as expenditure in that year. 


8 Debtors

31 March 2002 31 March 2001
£ £  
Due from Departments (see note 3a) 3,058,232 3,637,349
Accrued bank interest 10,654   7,784
Other debtors 419 -
Prepayments 16,654 20,107
3,085,959 3,665,240

                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
All debtors are due within one year.


9 Cash at bank

2001-2002 2000-2001
£  £
Balance at 1 April 2001 956,153 1,355,168
Net cash inflow 1,283,100    (399,015)
Balance at 31 March 2002 2,239,253    956,153
  31 March 2002 31 March 2001
REPRESENTED BY:   £   £
Endowment Trust Fund 124 122
Restricted income funds allocated to:    
Grants to individuals  2,111,377 843,378
Management and administration 127,752    112,653
2,239,253    956,153


 


10 Liabilities

31 March 2002 31 March 2001
£ £
(a)         Amounts falling due for payment within one year  
Liability due to individuals but not paid (see note 3b) 2,710,215 3,381,556
Liability due to Extension Fund  270,285 194,621  
Trade creditors 70,209 53,814
Accrual for audit fee 35,250    35,250
3,085,959    3,665,241

 

(b)        There were no amounts falling due for payment after one year.

 

11         Reconciliations to cashflow statement  

2001-2002 2000-2001
£ £
(a)         Reconciliation of other income to other cash receipts  
Other income 1,570,589 1,177,44
Profit on disposal  (20)  (6)
Decrease in debtor with Extension Fund - 23,336
Increase in creditor with Extension Fund 75,664    194,621
Other cash receipts  1,646,233    1,395,398  


(b) Reconciliation of management and administration expenses 
to other operating cash payments
 
Management and administration expenses 3,536,988 2,701,983
Depreciation  (127,611) (110,004)
Losses on disposal (1,585) (10,426)
(Increase)/decrease in trade creditors and accruals (16,396) 5,721
(Decrease) in other debtors and prepayments (3,034)     (43)
Other operating cash payments 2,587,231 3,388,362


(c) Reconciliation of net movement in funds to net cash
inflow from operating activities
  
Net movement in funds 1,235,277 (397,145)
Interest received (157,584) (172,902)
Depreciation charge 127,611 110,004
Losses on disposal 1,585 10,426
Less profit on disposal (20)  (6)
Decrease/(increase) in debtors 579,281 (1,047,918)
(Decrease)/increase in current liabilities (579,281)    1,047,919
Net cash inflow from operating activities 1,206,869    (449,622)



                                                                                                

2001-2002 2000-2001
(d) Reconciliation of bank interest to interest received £  £
   
Bank interest 160,454 151,878
(Increase)/decrease in accrued interest  (2,870) 21,024
Interest received 157,584 172,902


 Note 31 March 2001 31 March 2002  Cashflows Cashflows
(e) Analysis of net debt   2001-2002 2000-2001
  £ £ £ £
Cash at bank 9 956,153    2,239,253    1,283,100    (399,015)
Totals 956,153     2,239,253    1,283,100    (399,015)




12 Pension commitments

The Independent Living (1993) Fund does not operate its own pension scheme. Staff employed directly by the Fund are encouraged to participate in a personal pension scheme operated by Scottish Widows' Fund and Life Assurance Society. This is a defined contributions group pension scheme to which the Independent Living (1993) Fund contributes an amount based on each participating employee's gross salary. In 1994﷓1995 the Trustees of the Fund approved a contribution rate of eight per cent of gross salary and this rate continued in 1999-2000 and in 2000-2001. The value of each employee's contribution is at the discretion of the employee.

Staff directly employed by the Fund who opted not to participate in this personal pension scheme when it was set up, because they already had pension fund arrangements in force, were able to continue with their own arrangements. The Fund contributes eight per cent of gross salary to these schemes. Staff joining the Fund since the arrangements were set up do not have to join the scheme. In this event the Fund does not make any contribution to other schemes, because of the group pension arrangements agreed with Scottish Widows.

Pension scheme contributions due for staff directly employed by the Independent Living (1993) Fund are charged as revenue expenditure and included in the Financial Activity account in the year in which the charge accrues. The total of the pension contributions due from the Fund for 2001-2002 was £144,364 (£100,372 for 2000-2001).

The value of accrued contributions not paid over to the pension scheme at 31 March 2002 was nil (nil at 31 March 2001).


13 Capital commitments

Capital expenditure authorised and committed at 31 March 2002 was nil (£4,113 for computer software at 31 March 2001).

Capital expenditure authorised and not committed at 31 March 2002 was nil (nil at 31 March 2001).


14 Contingent liabilities

There were no contingent liabilities at 31 March 2002 (nil at 31 March 2001).



15 Leases and hire purchase

A four-year accommodation lease was signed by Trustees on 8 March 2000 to commence on 1 April 2000. There are no other leases, and no hire purchase commitments. A move to a new site is planned in 2002-03 and this will result in a new contract for accommodation and services in the next financial year. The current lease contains a break clause without financial penalty which will be called on once the intended new accommodation has been acquired by the landlord.

Operating lease rentals due within the next year on leases expiring within:

31 March 2002 31 March 2001
One year -  -
Two to five years 62,500 62,500
More than five years   -   - 


16 Trustees' interests and indemnities

The Trustees receive no remuneration. Six Trustees received reimbursement for travel and subsistence expenses amounting to £15,961 (£12,903 in 2000-2001). No transactions were undertaken in which any Trustee or person connected with any Trustee had a material interest.

There are no policies of insurance against loss arising from the neglect or default of the Trustees, nor any policies providing an indemnity for Trustees in respect of the consequences of any such loss.

By the terms of the Trust Deed, the Secretary of State for Work and Pensions provides that Trustees are not personally liable for any loss to the Fund other than that arising from wilful and individual fraud, wrongdoing or omission on the part of a Trustee who is found to be liable.


17 Related party transactions

The Independent Living (1993) Fund is administered by Trustees appointed by the Secretary of State for Work and Pensions. Related parties are the Trustees and all parts of the Department for Work and Pensions including its agencies (as representing the Secretary of State). Services provided free of charge by the Benefits Agency, such as site messengers and courier services, are included at nil value. The Trustees are the controlling party.

The Trustees are also the trustees of the Independent Living (Extension) Fund, a registered charity with similar objectives in relation to the provision of financial assistance to disabled people with the costs of care. The Fund provides an administration service for that charity and charges a management fee. The fee for the year was £1,570,489 (£1,177,327 in 2000-2001) and creditors of £270,285 (194,621 in 2000-2001) representing prepaid fees are included in the accounts.

During the year no other related parties, including the Trustees and key management staff, have undertaken any material transactions with the Independent Living (1993) Fund.


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