The directors and trustees present their annual report and financial statements for the year ended 31 December 2022.
The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the charitable company's governing document, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) and "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" (effective 1 January 2019).
The charitable company's objects are :-
- to relieve suffering, hardship and distress and promote the relief of need among men or women who have at any time served with the King's Own Scottish Borderers, and their families and dependants, by making grants of money, loans or guarantees.
- to act as administrators of the "King's Own Scottish Borderers War Memorial and War Relief Funds".
- to make contributions to or otherwise support charitable or benevolent bodies and to make donations for any public purpose connected with the activities of the charitable company or with the furtherance of its objects.
The directors and trustees have paid due regard to guidance issued by the Office of the Scottish Charity Regulator in deciding what activities the charitable company should undertake.
During the year the fund has continued to support former members of the King's Own Scottish Borderers and their families and dependants in accordance with the aims and objectives set out above. It is anticipated that these activities will continue for the foreseeable future.
There continues to be a healthy position in the General Fund, which allows the charitable company to continue to meet the current calls on the funds. Donations were received during the year, each gratefully acknowledged. Typically, income tax is reclaimed wherever possible on donations under the Gift Aid Scheme. This will resume in 2023 to cover any donations in the previous 5 years.
Applications from K.O.S.B. veterans and their families for Welfare assistance and Benevolence grants are processed and almonised by RHQ SCOTS. Financial assistance remains funded by the K.O.S.B. Association. In particular, the fund has assisted, and will continue to assist as the effects of the COVID-19 pandemic recede but the cost of living increases.
The salary of the Association Officer (Museum) continues to be funded by the Army Museums Ogilby Trust.
I continue to be extremely grateful to the Branch and Re-union Secretaries who, along with many others, especially the volunteers, help with the work of the Association. Their input will become ever more valuable in the years to come. In 2022, the Association resumed its normal level of activity, including a well attended and successful Minden Day parade.
I once again wish to thank my fellow directors and trustees, and Association office bearers, the staff team and our volunteers for their unstinting contribution during the year. Their willingness to commit themselves on a voluntary basis is much appreciated by myself and the wider Regimental family, especially given the many other calls on their time.
The accounts from page 6 onwards set out the full financial position for the year ended 31 December 2022.
Income
Total income for the year was £57,178 (2021: £53,657) an increase of £3,521.
Expenditure
Total expenditure for the year was £90,085 (2021: £85,026) an increase of £5,059.
The total net cost of benevolence was £5,000 (2021: £8,000) a decrease of £3,000.
Financial assistance was given in 46 cases (2021: 31) of hardship with all cases processed by RHQ SCOTS, who also dealt directly with the Army Benevolent Fund.
Donations to other organisations and charities amounted to £350 (2021: £100).
The cost of publishing and distributing the Borderers' Chronicle, £5,591 (2021: £5,170) was covered by income received.
The total revenue deficit across all funds for the year before investment movements was £32,907 (2021: £31,369 deficit).
Balance sheet
The total net assets of the Association General Funds as at 31 December 2022 were £505,133 (2021: £612,622). The decrease in value this year is entirely due to changes made within the investment portfolio, coupled with a weaker investment market performance experienced throughout the year.
The total market value of the investments at 31 December 2022 was £495,770 (2021: £595,563).
Grant making policy
Grants are made in accordance with the charitable company's objects, as set out on page 1, to relieve suffering, hardship and distress among men or women who have served at any time with the Regiment of The King's Own Scottish Borderers and their families and dependants. Each application is considered on its merits.
Public benefit
In considering the operation, achievements and performance and finances of the charitable company, the directors and trustees are satisfied that public benefit has been provided in accordance with the Charities and Trustee Investment (Scotland) Act 2005 and guidance provided by the Office of the Scottish Charity Regulator.
Reserves and investment policy
The directors and trustees have reviewed the reserves of the charitable company in relation to current and future requirements and consider that the reserves are adequate to allow the charitable company to continue to carry out its objects, and to meet its long term commitments.
The governing documents allow the directors and trustees to invest funds in any investment they think fit, at their absolute discretion.
Investments are professionally managed by Brewin Dolphin, acting on a discretionary basis. The investment objectives are to achieve a balance of income and capital growth with an emphasis on income, assuming a medium risk profile.
Risk review
The directors and trustees have conducted a review of the major risks to which the charitable company is exposed including the long term effect of the formation of the Royal Regiment of Scotland, and have established systems to mitigate the risks identified by putting the funds into their present corporate structure. The position in relation to administration is kept under review.
The K.O.S.B. Association Funds were incorporated on 13 December 2002, as a charitable company limited by guarantee. It is governed by its Memorandum and Articles of Association.
The members of the charitable company are the current directors and trustees. Every member has one vote, at general meetings of the charitable company which may be given either personally or by proxy.
The business of the charitable company is managed by the directors and trustees, who may exercise all the powers of the charitable company.
The maximum number of directors and trustees is fifteen, and the minimum number is four. The directors and trustees may appoint at any time a director and trustee to fill a vacancy or as an additional director and trustee. One third of directors and trustees are due to retire from office at the annual general meeting, but are eligible for re-election.
At the AGM Colonel A.J. Loudon M.B.E. CStJ and Lieutenant Colonel R.S. Combe M.B.E. will retire, with both eligible for re-election.
New directors and trustees are given a copy of the Memorandum and Articles of Association, the latest report and accounts, and all the charitable company's documents on governance. Subject to their experience and expertise, they are also given pamphlets issued by the Office of the Scottish Charity Regulator explaining the duties of Trustees of Charities and offered training in any area of their duties which they think they would like strengthening.
Directors and trustees
The directors and trustees who served during the year are as stated below:
As a company limited by guarantee, the charitable company does not have a share capital. The liability of each member is limited to £1.
The directors and trustees, who are also the directors of The K.O.S.B. Association Funds for the purpose of company law, are responsible for preparing the Directors and Trustees Report and the accounts in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
Company law requires the directors and trustees to prepare accounts for each financial year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.
In preparing these accounts, the directors and trustees are required to:
- select suitable accounting policies and then apply them consistently;
- observe the methods and principles in the Charities SORP;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the accounts; and
- prepare the accounts on the going concern basis unless it is inappropriate to presume that the charitable company will continue in operation.
The directors and trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the accounts comply with the Companies Act 2006, the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Exemptions
This report is prepared in accordance with the special provisions relating to small companies within Part 15 of the Companies Act 2006.
The directors and trustees report was approved by the Board of Directors and Trustees.
I report on the financial statements of the charitable company for the year ended 31 December 2022, which are set out on pages 6 to 20.
The charitable company's Directors and Trustees are responsible for the preparation of the accounts in accordance with the terms of the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. The charitable company's Directors and Trustees consider that the audit requirement of Regulation 10(1) (a) to (c) of the 2006 Accounts Regulations does not apply. It is my responsibility to examine the accounts as required under section 44(1) (c) of the Act and to state whether particular maters have come to my attention.
My examination was carried out in accordance with the Regulation 11 of the Charities Accounts (Scotland) Regulations 2006. An examination includes a review of the accounting records kept by the charity and a comparison of the accounts presented with those records. It also includes consideration of any unusual items or disclosures in the accounts, and seeks explanations from the directors and trustees concerning any such matters. The procedures undertaken do not provide all the evidence that would be required in an audit, and consequently I do not express an audit opinion on the view given by the accounts.
In connection with my examination, no matter has come to my attention:
to keep accounting records in accordance with Section 44(1) (a) of the 2005 Act and Regulation 4 of the 2006 Accounts Regulations, and
to prepare accounts which accord with the accounting records and comply with Regulation 8 of the 2006 Accounting Regulations;
to which, in my opinion, attention should be drawn in order to enable a proper understanding of the accounts to be reached.
designated
Subscriptions, donations, legacies and chronicle
Other trading activities
Investments
The statement of financial activities includes all gains and losses recognised in the year.
All income and expenditure derive from continuing activities.
designated
Subscriptions, donations, legacies and chronicle
Other trading activities
Investments
The statement of financial activities includes all gains and losses recognised in the year.
All income and expenditure derive from continuing activities.
The K.O.S.B. Association Funds is a private company limited by guarantee incorporated in Scotland. The registered office is 8 St Ann's Place, Haddington, East Lothian, EH1 4BS.
The financial statements have been prepared in accordance with the charitable company's governing document, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended), FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the Charities SORP "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)" (effective 1 January 2019). The charitable company is a Public Benefit Entity as defined by FRS 102.
The charitable company has taken advantage of the provisions in the SORP for charities not to prepare a Statement of Cash Flows.
The accounts are prepared in sterling, which is the functional currency of the charitable company. Monetary amounts in these financial statements are rounded to the nearest £.
The accounts have been prepared under the historical cost convention, modified to include the revaluation of fixed asset investments to market value. The principal accounting policies adopted are set out below.
At the time of approving the financial statements, the directors and trustees have a reasonable expectation that the charitable company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors and trustees continue to adopt the going concern basis of accounting in preparing the financial statements.
Unrestricted funds are available for use at the discretion of the directors and trustees in furtherance of their charitable objectives unless the funds have been designated for other purposes.
The general fund is an unrestricted fund which is available for use at the discretions of the directors and trustees in furtherance of the objectives of the charitable company.
Designated funds are unrestricted funds that have been set aside by the directors and trustees for particular purposes.
Restricted funds are subject to specific conditions by donors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.
Income is recognised when the charitable company is legally entitled to it after any performance conditions have been met, the amounts can be measured reliably, and it is probable that income will be received.
Cash donations are recognised on receipt. Other donations are recognised once the charitable company has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.
Membership subscriptions are recognised in the year in which they are received.
Legacies are recognised at the earlier of the date that the notification of distribution is received or that the legacy is received.
Investment income comprises dividends receivable during the year on listed investments held within the investment portfolio as well as interest receivable.
Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business and inclusive of VAT and other sales related taxes.
All expenditure is accounted for on an accruals basis. Costs are allocated to appropriate headings, based on the activities to which they are attributable.
Costs of generating funds are the costs of Christmas cards and Regimental items sold in the year.
Management and administration costs are those incurred in connection with the administration of the charitable company and compliance with constitutional and statutory requirements.
Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in net income/(expenditure) for the year. Transaction costs are expensed as incurred.
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. Items held for distribution at no or nominal consideration are measured the lower of replacement cost and cost.
Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the charitable company’s contractual obligations expire or are discharged or cancelled.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the charitable company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
In the application of the charitable company’s accounting policies, the directors and trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Subscriptions, donations, legacies and chronicle
designated
Grants
Subscriptions and chronicle
Other trading activities
Sale of K.O.S.B. Regimental items
Sale of book - "Always a Borderer"
Sale of Christmas cards
Other trading activities
Investments
Costs of goods sold and other costs
Work costs, including design and printing - "Always a Borderer"
Costs of goods sold and other costs
Raising funds
K.O.S.B. Regimental items and Christmas cards
Investment management costs
Borderers Chronicle
Remembrance wreaths and flowers
Advertising and promotions
Minden Day expenses
Kelso races
Insurances
Repairs and maintenance
Printing, stationery and office expenses
AGM expenses and lunches
Cruikshank Dinner
Bank charges
NI Memorial stone
Benevolence grants paid to individuals
Grants are made in accordance with the charitable company's objects, as set out on page 1, to relieve suffering, hardship and distress among men or women who have served at any time with the King's Own Scottish Borderers and their families and dependants. Each application is considered on its merits.
During the year 46 grants totalling £13,226 were made to individuals (2021: 31 grants totalling £6,498) to which the Association Funds contributed £5,000 (2021: £8,000), the balance being almonised with other Army Welfare charities where appropriate. All grants are processed by RHQ SCOTS who are responsible for all K.O.S.B. Welfare assistance and Benevolence applications.
Grant donations to institutions and branches
This includes a number of small donations made to K.O.S.B. Association Branch Secretaries and Army related charities located in Scotland.
Independent examination fee
Accountancy
Governance costs includes payments to the independent examiner of £900 (2021: £800) for independent examination fees.
None of the directors and trustees (or any persons connected with them) received any remuneration (2021: £Nil) or expenses (2021: £Nil) during the year.
The average monthly number of employees during the year was:
There were no employees whose annual remuneration was £60,000 or more.
designated
The charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxationof Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.
The income funds of the charitable company include restricted funds comprising the following unexpended balances of donations and grants held on trust for specific purposes:
The Association Officer (Museum) Fund consists of unrestricted grants received from the Army Museums Ogilby Trust that have been set aside by the directors and trustees in order to assist with the employment of an Association Officer (Museum) as well as a proportion of time provided by the Regimental Secretary, to help maintain the K.O.S.B. Regimental Collection.
The income funds of the charitable company include the following designated funds which have been set aside out of unrestricted funds by the directors and trustees for specific purposes:
Total resources expended
Other gains/(losses)
Total incoming resources
Total resources expended
Other gains/(losses)
The Piper Laidlaw VC Fund consists of unrestricted funds that have been set aside by the directors and trustees in order to care and maintain Piper Laidlaw's grave located within Norham Church grounds.
At the end of 2018, the K.O.S.B. Association Fund took over the management of a portfolio investment arising from a legacy by Captain Jack Cruikshank, to enable and subsidise an annual all ranks Dinner. Therefore, in order to separately identify these funds, the directors and trustees chose to designate the investment portfolio, which in future years will be used to defray some of the costs of the annual Cruikshank Dinner.
The Shepherd Fund consists of unrestricted donations that have been set aside by the directors and trustees in order to assist those men or women who served with the King's Own Scottish Borderers, and whose families are suffering hardship or distress in meeting the costs of funeral arrangements.
The NI Memorial Stone Fund consists of unrestricted funds that have been set aside by the directors and trustees in order for a Memorial Stone to be commissioned and erected in Northern Ireland to honour our fallen comrades.
The 7 K.O.S.B. Memorial Fund consists of unrestricted donations that have been set aside by the directors and trustees in order for a Memorial to be commissioned and erected to honour the 24 members of 3 Platoon, A Company, 7 K.O.S.B. (Airborne) who tragically lost their lives during a night-time exercise in Hampshire on the 4 April 1944.
There were no disclosable related party transactions during the year (2021: None).
Every ordinary member of the charitable company undertakes to contribute to the assets of the charitable company in the event of it being wound up while he is a member or within one year after he ceases to be a member, for such an amount as may be required not exceeding £1.