TRUSTEES REPORT
Our financial position
The Foundation remains well-placed financially to deliver its long-term objectives, thanks to the funding agreed by CareTech Ltd as set out in the Donation Agreement between the company and the Foundation settled in July 2019.
This year, similar to FY22/23 and FY23/24, the Company committed to an annual donation of £750,000 and an additional restricted donation of £50,000 to support the growth of the Foundation’s Staff Hardship Fund. As highlighted above, the sale of CareTech Limited’s shares provided the Foundation with a significant cash boost and the opportunity for the Foundation to implement its long-term investment and income diversification strategy.
CareTech Ltd complements its financial donations by supplying significant in-kind support, such as office accommodation, back-office systems and staff expertise. We have established systems to capture and attribute the full value of CareTech Ltd’s support to the Foundation, which includes:
- the value of all in-kind support provided (accommodation, back-office support, staff salaries for seconded staff, etc);
- the value of employee volunteering hours; and
- any other value-added/leveraged support provided by the Foundation
In this current year, the overall value of this in-kind support has been valued at just over £18,182, of which
£7,740 is support towards facilities (IT devices and office costs) and £10,900 towards relevant projects through
expertise sharing of staff members.
As noted in this Report, trustees have established an Income Diversification Strategy. The benefits of
diversification of income go far beyond simply achieving an income surplus; diversification also gives
organisations the security needed to focus more on long-term strategies and ultimately have more impact on
their beneficiaries. The aims of the Foundation’s income diversification strategy, therefore, are:
- to increase the capacity of the Foundation’s grant-making capacity;
- to reduce its reliance on a single income stream (however reliable);
- to provide greater certainty of future levels to encourage longer-term investment.
As noted above, CareTech Ltd has made a restricted donation to the Foundation over and above its main annual
donation over the last four years to support the Foundation’s Staff Hardship Fund. This year’s restricted donation
remained at £50,000, all of which was committed during the year.
Trustees are provided with a monthly financial report as part of the Director/CEO’s regular report and further
scrutiny is undertaken by the Audit & Risk Committee as well as the full Board of trustees.
Our reserves policy
Trustees recognise that we need to invest our funds wisely and safely but have also agreed that we wish to back innovative programmes. With innovation comes higher potential impact but also, of course, higher risk. As trustees, we have agreed that we have:
- a reasonably high risk appetite in respect of the projects we support, although will always seek a balanced portfolio of projects of varying risk levels;
- a low risk appetite in respect of the reputation of the organisations with which we partner, preferring to work with credible and respected partners; and,
- a low risk appetite in terms of process, having put in place rigorous due diligence procedures to safeguard the Foundation’s funds and reputation.
In line with the above risk statement, the Foundation maintains free unrestricted reserves:
- to provide a level of working capital that protects the continuity of its core work;
- to provide a level of funding for unexpected opportunities; and,
- to provide cover for risks such as unforeseen expenditure or unanticipated loss of income.
Since the 2021/22 Financial Year, the trustees have agreed the Foundation’s Reserves Policy to establish a target of maintaining free reserves equal to six months of staff and associated costs. At the end of this Financial Year the Foundation had £7.379M of unrestricted reserves, of which £3.7M has been designated as relating to the investment property and a further £1.88M in the Amalfi Topco rollover shares which cannot be easily realised. The Foundation has commitments of £0.38M disclosed in Note 9 of the Accounts and therefore free reserves of £1.42M. This is in excess of our target holding of £200,000. The Foundation intends to use the excess reserves to supplement anticipated donations in future years, in line with trustees’ agreed general aim to maintain expenditure at similar levels to that of the last few years.
Going concern review
Trustees have considered carefully the position of the Foundation as a going concern throughout the year and is
confident that the charity remains well-placed in this respect. Trustees base this assessment on the following
factors:
- The Foundation has a formal agreement with CareTech Ltd in respect of the charitable donation it can expect each year. The agreement provides for a lengthy notice period should the company wish to withdraw from these arrangements.
- The trustees note the long-term profitability and growth of CareTech Ltd over its long history.
- The Foundation has agreed an Income Diversification Strategy.
- Strong business planning and financial management systems are in place to contain costs.
- Strong contingency and mitigation plans and measures are in place in the event of significant downward pressures on income, including the discretion of trustees to vary the levels of annual grant funds overall and
individual grants, as well as the use of conservative budgeting assumptions.
Other financial matters
The Foundation operates defined contribution schemes for its employees. Contributions outstanding at the year-end are disclosed in Note 23 to the Accounts.’
Our fundraising approach
The primary source of revenue for the CareTech Foundation originates from the annual donation provided by its founding entity, CareTech Ltd. Over the past year, we have made a concerted effort to diversify the Foundation’s
income channels, ensuring its sustained capacity to deliver public benefit.
In alignment with the Foundation’s Income Diversification Strategy, we have opened opportunities for both employees and external stakeholders to participate in fundraising activities with the explicit goal of directing all
contributions towards the Foundation’s grants.
Regulatory considerations
In developing its fundraising initiatives, the Foundation has endeavoured to adhere to the best practice standards outlined in The Code of Fundraising Practice issued by the Fundraising Regulator. Acknowledging the planned expansion of its fundraising efforts, the Foundation is registered with the Fundraising Regulator, ensuring that all fundraising activities comply with current regulations and adhere to the best practices set out by regulators and professional membership bodies. The Foundation continues to disseminate codes of best practice to supporters and relevant partners, ensuring the application of these standards across all activities.
To date, we have no knowledge of any breaches of The Code of Fundraising Practice. Due to the nature of delivering fundraising across multiple sites through volunteer effort, the Foundation recognizes the risk of breaching fundraising compliances. Consequently, the Foundation has conducted a comprehensive review of its policies to ensure their fitness for purpose in light of its extended fundraising efforts.
Fundraising activities for the Foundation are accessible to both CareTech Ltd employees and external shareholders. All information pertaining to fundraising challenges is promoted on the Foundation’s website with links to the official website to ensure transparency. Fundraising agreements are shared with interested participants at the earliest possible time. Recognising that some of our supporters may lack experience in fundraising for charities, additional training and support services are offered to fundraisers upon entering into an
agreement with the Foundation.
All fundraising donations are processed through the JustGiving and Give as You Live platforms, allowing the Foundation to monitor fundraising efforts actively. The Foundation engages with supporters through social media, encouraging transparency and communication.
The Foundation has a Complaints Policy outlining how complaints should be addressed within the charity and when they should be escalated to senior management. The Complaints Policy is available on the Foundation’s website at . Active steps have been taken to ensure that the Policy is shared promptly with fundraising agreement participants. Since inception, the CareTech Foundation has received no complaints regarding fundraising.
Engagement with vulnerable individuals
The Foundation regularly interacts with individuals in vulnerable positions as part of its day-to-day activities. To safeguard vulnerable people, the Foundation has a Safeguarding Policy in place and a nominated Safeguarding
Trustee. In the current financial year, the Foundation has reviewed its Safeguarding Policy to ensure that vulnerable supporters can undertake fundraising in a safe and effective manner. The nature of the Foundation’s work ensures that all employees are comfortable recognising and working with individuals in vulnerable positions.