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Financial Report

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




 




PAGE        CONTENTS

           1        Trustees' report

         6        Statement of Trustees and Chief Executive's responsibilities

         8        Statement on the system of internal control

       12        Auditor's report

       14        Statement of accounts

       17        Notes to the accounts


 

Independent Living (Extension) Fund
Registered charity No 1019080


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 a 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. 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 (Extension) Fund, generally referred to as "the Extension Fund", was set up in April 1993 to continue the administration of awards to the clients of the original ILF when that Fund closed. Its awards are made to disabled people in the form of regular monthly payments which enable them to pay for personal assistance. The Extension Fund is not accessible to new applicants.

The Fund is mainly financed by central government through the provision of grants in aid and is constituted as a charity with a board of seven Trustees appointed by the Secretary of State for Work and Pensions (formerly the Secretary of State for Social Security). The same Trustees are responsible for the Independent Living (1993) Fund, generally referred to as "the 93 Fund", which is a discretionary trust having similar financing and objectives and which accepts new applications.

The Trust Deed

The Trust Deed of the Extension Fund determines that awards will be made to people who were clients of the original ILF provided that they:

 continue to need help with their personal or domestic care and live alone or with others who are unable to provide the extra care needed

 receive the highest care component of a disability living allowance

 have savings of less than £8,000 (revised upwards to £18,500 from April 2002) and income which is insufficient to cover the cost of the care needed 

The Trust Deed also determines certain restrictions upon how awards may be spent. The maximum weekly payment has been £625 since January 2000 and has been increased to £665 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 Fund publishes its basic information leaflet in ten languages, large print, Braille and talking tape.

Review of developments

The Extension Fund started in April 1993 with 21,500 clients from the original ILF. The number still requiring assistance has reduced to 7798 at 31 March 2002 compared with 8,538 at 31 March 2001. The average weekly award to clients at the end of the year was £179 per week compared with £163 at 31 March 2001.

There has been an increase in staff to cope with requests for increased awards 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 £625 to £665 approved by the Minister for Disabled People, take effect from April 2002. A number of other recommendations were made in the report to improve client service, 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, originally with clients of the 1993 Fund from counties close to the Fund’s offices; clients of this Fund were invited to join the group towards the end of the year. 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 Extension Fund and 93 Fund are jointly financed, mainly out of money voted by Parliament in the form of grant 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 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 Trust 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 (previously the Department of Social Security).

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 (Extension) 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 Trust Deeds 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 Funds 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, 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 the 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 Fund is 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 (Extension) Fund

I certify that I have audited the financial statements on pages 14 to 21 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 17.

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

As described on pages 6 to 7 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 8 to 11 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 (Extension) 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
21 June 2002 London SW1W 9SP


Independent Living (Extension) Draft Statement of Accounts
Registered Charity No 1019080

Statement of Financial Activities for the Year ended 31 March 2002

                                                                                                         Restricted and                                Restricted and
                                                                                                              endowment                                     endowment 
                                                                                                                       Funds                                               Funds 

                                                                                     Notes                2001-2002                                      2000-2001
                                                                                                                                £                                                       £ 
Incoming resources

    Activities in furtherance of 
    the Charity’s objects                                                    4a                70,719,593                                    69,828,943 

    Bank interest                                                                                          131,110                                          152,313 

    Other income                                                                4b                             272                                                 163
                                                                                                                 -----------------                                 ----------------- 
Total incoming resources                                                                    70,850,975                                    69,981,419


  Resources expended

    Direct charitable expenditure: 
    grants to individuals                                                        5              (69,239,869)                                (68,934,303)

    Management and administration                                   6                (1,593,989)                                  (1,200,827)


  Total resources expended                                                                (70,833,858)                                (70,135,130) 
                                                                                                               ------------------                                 ----------------- 
    Net incoming/(outgoing) resources                                                  17,117                                      (153,711) 

    Balances brought forward at 1 April 2001                                        1,323,586                                     1,477,297
                                                                                                                -----------------                                 ----------------- 
    Balances carried forward at 31 March 2002                               1,340,703                                    1,323,586 
                                                                                                                ==========                               ========== 

                                    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 17 to 21 form part of this account




Balance Sheet as at 31 March 2002
                                                                                           Notes              31 March 2002                31 March 2001
                                                                                                                                           £                                        £ 

Current Assets

     Debtors                                                                                 7                      2,084,808                        3,148,196 
     Cash at bank and in hand                                                   8                      1,340,703                        1,323,586 
                                                                                                                            ---------------                       ---------------
                                                                                                                             3,425,511                        4,471,782 

Current Liabilities

     Amounts falling due within one year                                   9                    (2,084,808)                       (3,148,196)
                                                                                                                            ---------------                        ---------------
Total Assets less Current Liabilities                                                          1,340,703                         1,323,586 
                                                                                                                            =========                       =========

Fund Balances:

     Endowment Trust Fund                                                         4                                 124                                    122 

     Restricted income funds allocated to:

        Grants to individuals                                                            4                      1,340,574                         1,323,459 
        Management and administration                                       4                                      5                                        5 
                                                                                                                                ---------------                         ---------------
                                                                                                                                1,340,703                         1,323,586
                                                                                                                               =========                        =========

                                                  

                                                The notes on pages 17 to 21 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                      71,857,300                 69,846,500

    Other receipts                                                                                                              272                              163

    Payments to individuals                                                        5                     (70,303,257)              (68,757,332)

    Other operating cash payments                                        10a                     (1,669,653)                 (1,418,784)
                                                                                                                               ----------------                  ----------------
Net cash outflow from operating activities                   10b                         (115,338)                    (329,453)

Returns on investments and servicing of finance

    Interest received                                                                  10c                          132,455                       175,742
                                                                                                                                 ----------------                  ----------------
Increase/(decrease) in cash and cash equivalents                                        17,117                      (153,711) 
                                                                                                                                  =========                 =========

-------------------------------------------------------------------------------------------------------------------------------------------------------------
Reconciliation of Net Cash Flow to Movement in Net Debt (see note 10d)

                                                                                                                                  2001-2002                  2000-2001 
                                                                                                                                                                          (restated)
                                                                                                                                            £                                   £ 

Increase/(decrease) in cash                                                                                         17,117                     (153,711)

Net funds at 1 April 2001                                                                                         1,323,586                   1,477,297 
                                                                                                                                    ---------------                  ---------------
Net funds at 31 March 2002                                                                                     1,340,703                  1,323,586 
                                                                                                                                   =========                 =========

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


                                                            The following notes 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 (now 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, Northern Ireland). 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.

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 the Independent Living (1993) Fund to provide an administration service for this Fund and to charge an administration fee. Accordingly, this Fund and the Independent Living (1993) Fund are administered jointly by staff employed by the Trustees of the latter Fund. All management and administration costs for both Funds are borne in full by the Independent Living (1993) Fund, which recovers an agreed administration fee from this Fund.

d) Fixed assets, depreciation and capital expenditure

Under the administration arrangements described at 3c, the Independent Living (1993) Fund purchases all assets necessary for the administration of both Funds, and bears the associated depreciation costs. 

4 Analysis of restricted funds

                                                                      Restricted income funds         Endowment        Total                    Total 
                                                                          apportioned between:         Trust Fund      2001-2002          2000-2001 
                                                                    Grants to     Management &
                                                                  individuals       administration 
                                                                                  £                              £                    £                        £                          £ 

Grants in aid received                (a)      70,320,100              1,537,200                     -       71,857,300         69,846,500 
Grants in aid: (debtor)/creditor
at 1 April 2001                            (a)        (3,124,696)                180,228                     -        (2,944,468)        (2,962,025)
Grants in aid: debtor/(creditor)
at 31 March 2002                        (a)         2,061,308                (254,547)                   -          1,806,761          2,944,468 
                                                                      ------------                   -----------               -----             ------------             ------------
Grant income                                           69,256,712              1,462,881                    -         70,719,593        69,828,943
Bank interest                                                              -                  131,108                   2              131,110            152,313 
Other income                               (b)                    272                               -                    -                       272                   163 
                                                                     ------------                   -----------                -----             ------------            ------------
Funds available                                       69,256,984               1,593,989                   2         70,850,975       69,981,419
Expenditure (see notes 5 & 6)              (69,239,869)            (1,593,989)                   -       (70,833,858)   (70,135,130)
                                                                      ------------                  -----------                 -----             ------------           ------------
Net movement in funds                                    17,115                             -                    2                 17,117         (153,711) 
Funds brought forward at 1 April 2000     1,323,459                            5               122            1,323,586       1,477,297 
                                                                       ------------                  -----------                -----              ------------          ------------
Funds carried forward at 31 March 2001 1,340,574                            5               124            1,340,703       1,323,586 
                                                                    ============    ===========      =====     ============  =========

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. The endowment trust fund consists of the original endowment and any bank interest earned on the sum, and is held in trust. There are no arrangements for transfers between funds.

(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                          68,602,474          (2,852,009)       1,758,615     67,509,080     66,845,038 
   Department for Social
     Development                              3,254,826                (92,459)            48,146        3,210,513      2,983,905 
                                                           ------------                 -----------            -----------          ------------        ------------
   Totals                                           71,857,300          (2,944,468)       1,806,761     70,719,593    69,828,943 
                                                     ============     =========== ========== =========== ===========

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 the current financial year in respect of the next financial year included as debtors in the balance sheet at 31 March 2002.

(b) Other income summary
                                                                                                                            2001-2002                2000-2001 
                                                                                                                                             £                                 £ 

Refunds in respect of original Independent Living Fund (see below)                      272                            156 
Donations                                                                                                                            -                                 7
                                                                                                                                 ---------                         ---------
Total other income                                                                                                         272                            163 
                                                                                                                             =========               =========

This Fund handles refunds due to the Department for Work and Pensions from clients of the original Independent Living Fund which closed on 31 March 1993, and retains an agreed proportion of the amounts refunded.

5 Grants to individuals (see note 3b)
                                                                                                                            2001-2002                2000-2001
                                                                                                                                             £                                 £

Payments made in year                                                                                  70,303,257               68,757,332 
Creditors at 1 April 2001                                                                                 (3,124,696)               (2,947,725)
Creditors at 31 March 2002                                                                             2,061,308                  3,124,696 
                                                                                                                              ------------                      ------------
Grants payable for year                                                                                   69,239,869               68,934,303 
                                                                                                                        ============         ============

Number of individuals in receipt of payments                                                         8,154                         8,830 

Individuals paid for the year includes all clients who received any payment for the financial year, whether or not they were in payment for the whole year, and whether or not they were in payment at the end of the year.

6 Management and administration
                                                                                                                           2001-2002                    2000-2001 
                                                                                                                                            £                                     £ 

Administration fee (see note a)                                                                        1,570,489                     1,177,327 
Auditor's remuneration                                                                                            23,500                          23,500 
                                                                                                                                -----------                          -----------
Total costs                                                                                                           1,593,989                    1,200,827  
                                                                                                                           ===========             ===========

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

The Chief Executive and senior management staff receive no remuneration from the Fund (see note a below).

(a) Analysis of administration fee

As explained in note 3c the Independent Living (1993) Fund provides a management and administration service for this Fund and recovers an administration fee. The main components of the administration fee are summarised below.

                                                                                                                        2001-2002                    2000-2001 
                                                                                                                                         £                                     £

    Staff costs                                                                                                   1,030,934                         704,979 
    Trustees expenses                                                                                             8,405                             7,355 
    Computer running costs                                                                                   25,167                          38,795 
    Postage, printing and stationery                                                                     84,945                          78,655 
    Accommodation and utilities                                                                           73,487                          62,671 
    Visiting Social Workers' fees and expenses                                               230,629                       156,192 
    Services, communications, training, etc                                                      116,922                        128,680 
                                                                                                                               -----------                        -----------
    Amount payable for year                                                                             1,570,489                    1,177,327 
                                                                                                                         ===========              ===========

Increased expenditure for 2001-2002 reflects increased activity. An increase in staff numbers, and an expanded programme of revisits to clients of the Fund, were approved by the Trustees.

7 Debtors
                                                                                                          31 March 2002        31 March 2001
                                                                                                                                  £                                £ 
Due from Departments (see note 3a)                                                   1,806,761                2,944,468 
Prepayment to 93 Fund                                                                             270,285                    194,621 
Accrued bank interest                                                                                    7,762                         9,107 
                                                                                                                     -----------                      -----------
                                                                                                                  2,084,808                 3,148,196 
                                                                                                              ===========          ===========
All debtors are due within one year.

8 Cash at bank
                                                                                                               2001-2002                  2000-2001 
                                                                                                                                £                                   £ 

     Balance at 1 April 2001                                                                   1,323,586                   1,477,297 
     Net cash inflow/(outflow)                                                                        17,117                     (153,711) 
                                                                                                                    -----------                        -----------
     Balance at 31 March 2002                                                              1,340,703                   1,323,586 
                                                                                                             ===========             ===========

REPRESENTED BY:                                                                   31 March 2002            31 March 2001
                                                                                                                                £                                    £ 

     Endowment Trust Fund                                                                               124                               122 
     Restricted income funds allocated to:
     Grants to individuals                                                                         1,340,574                    1,323,459 
     Management and administration                                                                    5                                   5 
                                                                                                                     -----------                         -----------
                                                                                                                  1,340,703                   1,323,586 
                                                                                                              ===========              ===========


9 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)                         2,061,308                   3,124,696 
Accrual for audit fee                                                                                      23,500                        23,500 
                                                                                                                      -----------                        -----------
                                                                                                                   2,084,808                   3,148,196 
                                                                                                               ===========            ===========
(b) There were no amounts falling due for payment after one year.


10 Reconciliations to Cashflow Statement

                                                                                                                                2001-2002                    2000-2001 
                                                                                                                                                 £                                     £ 

(a) Reconciliation of management and administration expenses to 
other operating cash payments

     Management and administration expenses                                                   1,593,989                     1,200,827 
     Increase in prepayments                                                                                        75,664                        194,621
     Decrease in creditors and accruals                                                                                 -                          23,336 
                                                                                                                                      -----------                          ----------
     Other operating cash payments                                                                       1,669,653                    1,418,784 
                                                                                                                              ===========                ==========

(b) Reconciliation of net movement in funds to 
net cash inflow from operating activities

     Net movement in funds                                                                                           17,117                      (153,711) 
     Interest received                                                                                                  (132,455)                     (175,742)
     Decrease/(Increase) in debtors                                                                       1,063,388                      (153,635)
    (Decrease)/increase in current liabilities                                                        (1,063,388)                      153,635 
                                                                                                                                      ---------                           -----------
     Net cash outflow from operating activities                                                         (115,338)                    (329,453)
                                                                                                                                   =========              ===========

                                                                                                                                  2001-2002                  2000-2001 
                                                                                                                                                   £                                   £

(c) Reconciliation of bank interest to interest received

Bank interest                                                                                                                131,110                       152,313 
Decrease in accrued interest                                                                                          1,345                         23,429 
                                                                                                                                          ---------                           ---------
Interest received                                                                                                           132,455                       175,742 
                                                                                                                                    =========                 =========

(d) Analysis of net debt

                                                 Notes            31 March 2001        31 March 2002          Cashflows          Cashflows
                                                                                                                                             2001-2002        2000-2001 
                                                                                                £                                £                          £                         £ 

Cash at bank                                   8                    1,323,586                  1,340,703               17,117           (153,711) 
                                                                                   -----------                     -----------                 -----------            -----------
Totals                                                                      1,323,586                  1,340,703               17,117           (153,711) 
                                                                             ===========           ===========    ===========  ===========

11 Other commitments and liabilities

The Independent Living (Extension) Fund does not operate a pension scheme as it does not employ staff (see note 3c).

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

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

There are no lease or hire purchase commitments.

12 Trustees' interest and indemnities

The Trustees received no remuneration. No transactions were undertaken in which any Trustee or person connected with any Trustee has 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.

13 Related party transactions

The Independent Living (Extension) 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). The Trustees are the controlling party.

The Trustees are also the trustees of the Independent Living (1993) Fund, a private trust with similar objectives in relation to the provision of financial assistance to disabled people with the costs of care. The trust provides an administration service for this Fund and charges a management fee. The fee for the year was £1,570,489 (£1,177,327 in 2000-2001) and debtors 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 (Extension) Fund.

                                                                    

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