LHP Financial Statements 31 March 2022 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 20222 Contents Information 3 About Us 4 Chief Executive Statement 6 Chair's Statement 7 Board Responsibilities in Respect of the Financial Statements 8 Strategic Report 9 Independent Auditors’ Report to the Members 48 Statement of Comprehensive Income 51 Statement of Financial Position 52 Consolidated Statement of Changes in Reserves 53 Consolidated Statement of Changes of Cash Flows 54 Notes to the Financial Statements 56 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
ChairBoardInformationofManagement
Anthony Read
Jiggy YvonneLloydLowe (resigned 30 September 2021)
Executive Director of Customers Mark Coupland (appointed 1 July 2022)
Executive Directors
Rhiannon Davies (appointed 1 June 2022)
Secretary
John Crowther
Kathryn Price
Carl Dewey
Zoe Wortley (resigned 17 November 2021)
Kate Lindley (appointed 14 September 2021)
Paul Casey
Nicola Ebdon (appointed 17 November 2021)
Executive Director of Strategy, Culture and Digital Suzanne ExecutiveWicksDirector of Property Alex Dixon
Rob Jones (resigned 6 December 2021)
LHP Financial Statements | 31 March 20223
Murray Macdonald
Registered Office: Westgate Park, Charlton Street, Grimsby, North East Lincolnshire DN31 1SQ Financial Conduct Authority Registered Number: 7748 Regulator of Social Housing Registration Number: 4877 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Executive Director of Finance
Sally Marshall-Mills (appointed 14 September 2021)
Simon AdrienneParkesBoggins (appointed 1 June 2022)
Bridget Lloyd (resigned 30 June 2022)
Chief Executive
Executive Director of Customers
Our commitment to being a Customer First company means that our customers are at the forefront of our
LHP’s core social purpose means that as an organisation we concentrate our support and investment activities to ensure the long-term wellbeing of our customers, staff, and the communities in which we are based. LHP exists to provide high quality and affordable homes in strong communities across Lincolnshire and we remain resolute in our commitment to that purpose which drives all we do. We focus on meeting the needs of our existing residents by investing in their homes, local communities, and services.
LHP Financial Statements | 31 March 20224
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We have made great strides with our Digital Transformation Journey, and in 2021 we launched a new customer portal and app – MyLHP, and a new corporate website.
In early 2020 we launched our internal Culture Change Programme, The LHP Way, which means providing engagement and development opportunities, as well as enhancing our output through the embrace of technology.
Our focus is also on what LHP can do to contribute to a more sustainable future. This saw the recent issuing of our ESG Strategy, which aims to create positive environmental and social impacts, with outcomes that benefits our customers, communities, employees, and other stakeholders.
LHP in Homesnumbersownedand managed 12,142 Local authority areas covered 6 Colleagues 371 Turnover £54.9m Operating Profit £13.5m Amount invested in planned repairs £15.1m Repairs delivered 42,853 ASB cases reported 455 Formal complaints received 273 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
saying we’re proud to be a values-based organisation.
About Us
Lincolnshire Housing Partnership (LHP) manages over 12,000 affordable rental and shared ownership homes and offers a range of other services to support people and communities across the historic east coast of Lincolnshire. Over 75% of our stock holdings are found near Boston and Grimsby, which include some of the poorest wards in the country.
As a charitable community-based organisation, we channel surpluses back into services and projects that benefit our customers and local neighbourhoods.
LHP Financial Statements | 31 March 20225 About Us Customers satisfied with how their complaint was handled 69% Monetary value of support from our Money Support Service £344,376 Rating from the Regulator for Social Housing G1 / V2 Standards & Poors Credit Rating: A | Outlook: Negative DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Murray Macdonald Chief Executive
Investing in our communities
an incredible team of colleagues who live and breathe our values and are united in our mission to provide great homes and services. During the pandemic, our people responded heroically, and we’ve learned a lot about how we can work differently in the future.
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We’ve provided the support and services our customers needed during this difficult time while remaining mindful of our purpose and firmly focused on our vision. We’ve also strengthened our connection with our communities. In many ways, our ongoing response to the pandemic has become part of our business-as-usual approach, with customer wellbeing calls, for example, now becoming part of our day-to-day service. As we interact with those who are more vulnerable and gain a better understanding of their needs, we are improving the support and guidance we provide and doing everything we can to support customers to live independently and well.
StatementExecutiveChief
Now is the time to take positive steps toward becoming the organisation we want to be – an organisation that continues to prioritise customers and colleagues while providing services that improve communities and people’s lives.
The retention of this rating demonstrates that, despite the significant challenges of the last year, we are still well-positioned to deliver on our strategy, which will see us invest in our communities, go to new lengths to do even more for our customers, and build and refurbish our homes. Continued sound financial management will be critical to realising this ambitious vision, ensuring that we are well-positioned to deliver on our targets in the coming years, as we continue to play our part in addressing housing and social issues.
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We should always strive to do more for our customers and provide services that make a genuine difference in their lives. That is something I believe we already do well, but by working smarter together and staying connected with our customers and communities, we can achieve even more. We’ve come a long way in the last few years, reaping the benefits of joining forces, preparing for the launch of our new Corporate Strategy, and seeing it have a real
Our reputation as a strong, well-governed, and financially sound organisation has been demonstrated throughout the year, and this has been recognised with the gaining in April 2021 of G1/V2 status from the Regulator of Social Housing, which was retained in November 2021.
Robust governance and financial management
Everything we’ve accomplished in the last year will help us recover faster from the pandemic. We’ve already laid out our future vision for working smarter
to be more agile. We’ll cut down on business travel and make better use of technology.
Following a year in which the Coronavirus pandemic has continued to influence how we live and work, I’m extremely proud of how we’ve responded to this extended challenge, doubling our efforts to keep customers and colleagues safe while maintaining high performance in so many areas.
Looking forward
As we report on another challenging year, it is important that we also look forward, embracing change and refocusing our ambitions.
equality,emphasishasnewFederation’sHousingNationalTheCodearenewedondiversity,
Throughoutability.the
StatementChair’s
We have continued to support the people and communities who rely on us by remaining focused on our vision of Great Homes and Strong Communities and trying to put the Customer First in all that we do. In addition to keeping people safe and providing the best service to our customers that we can, LHP has delivered a strong financial performance, ensuring that the services we provide are delivered to the best of our
and inclusion (ED&I), which has been a priority for us over the last year. Through the continued development of the Group’s people strategy, policies, and decision making, the Board has continued to champion ED&I across the organisation. Environmental changes in both new development and existing housing stock have also been high on our agenda, as we look to deliver our ESG strategy.
Anthony Read Chair of the Board
I am extremely proud of everything we have accomplished but we must look to the future and seize the opportunities available to us to continue to improve and deliver better services for our customers. The way we work has evolved, and that evolution must continue. We will be able to do more for our customers, reduce our environmental impact, and improve our colleagues’ work-life balance by working more flexibly, travelling less, and being more visible in communities.
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Embracing change for a better future
We have also had to adapt as a Board, becoming accustomed to virtual meetings while maintaining strategic focus as we do all that we can to make LHP a better place for customers, staff and everyone who works with and depends on us.
last year we have been working hard on our new five-year Corporate Strategy, and I am delighted that this has just been launched. It builds on our existing Vision and Values and focuses on improving what we do, giving our customers the best possible homes and support that we can. I would like to thank everyone for their input, as without this feedback and insight we could not have developed our new plan.
The implementation of modern technology, processes, and innovative ways of working has provided us with more flexibility to interact with customers. We’re also doing more to support people with their wellbeing, mental health, and financial concerns – issues that have been exacerbated by the pandemic, national lockdowns, and other restrictions.
LHP Financial Statements | 31 March 20227
The Board is responsible for preparing the report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the Board is required to:
Statement of Compliance
The Board confirms that this Strategic Report has been prepared in accordance with the principles set out in paragraph 4.7 of the 2018 SORP for Registered Social Housing Providers.
The Strategic Report was approved on 26th July 2022 on behalf of the Board
The Board is responsible for the maintenance and integrity of the association’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
• Select suitable accounting policies and then apply them consistently
• Prepare the financial statements on the going concern basis, unless it is inappropriate to presume that the group and the association will continue in business
the Co-operative and Community Benefit Societies (Group Account) Regulations 1969, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2022. It has general responsibility for taking reasonable steps to safeguard the assets of the group and association and to prevent and detect fraud and other irregularities.
Board Responsibilities in Respect of the Financial Statements
Anthony Read Chair
• Make judgements and estimates that are reasonable and prudent
LHP Financial Statements | 31 March 20228
The Co-operative and Community Benefit Societies Act 2014 and registered social housing legislation require the Board to prepare financial statements for each financial year which give a true and fair view of the group and association and of the income and expenditure for the period of account.
• State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements, and
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The Board is responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the group and association, and enable it to ensure that the financial statements comply with the Cooperative and Community Benefit Societies Act 2014,
the many successful joint working projects already underway. We achieve more by working together with our key stakeholders and by working together as one team.
Together
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Our vision and values
We create a structured opportunity for stakeholders, staff, and customers to provide feedback. We value this time and insight and use it to act and learn from it. Before investing in new and existing projects, we seek the views of those set to benefit.
We put customers at the heart of our decision-making process and develop services that are built around their needs. This emphasis is felt by customers in every interaction with us, driving up our customer satisfaction and ensuring we invest our money where it has the greatest impact.
Listen, Act and Learn
Our ValuesCustomerFirst
We proactively seek out new partnerships and work to build on
Strategic Report
LHP Financial Statements | 31 March 20229
Thousands of phone calls to check on the well-being of people in our communities have become routine for us. We have been able to strengthen ties and gain a better understanding of our customers because of
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Simon LHP customer, Boston
emphasising the importance of continuing to support the most vulnerable people in our communities. We plan to do much more in the future.
We started making frequent wellbeing phone calls at the outset of the pandemic to better understand how to support our customers. These regular calls helped us stay connected with our customers and find out the assistance they needed in their communities. We are looking at how we can further customise our services, and tailor our communication directly to customers’ needs.
We have adjusted the way we run our sheltered schemes and we have worked closely with partners to develop solutions that have kept people safe, in addition to continuing to provide care and support to our customers and residents.
We are tremendously proud of our ability to provide support to those who have needed it the most. We have worked hard to keep one step ahead of the Coronavirus pandemic, from sourcing record volumes of PPE to adopting new procedures to ensure resilience. We are continuously updating our Risk Assessments to ensure that we keep customers and colleagues safe.
We have had to adjust to a new style of working in the previous 12 months, relying more on digital technologies and telephone communication with our customers.
“I cannot thank LHP enough for what they have done for me I feel at home in my new flat, particularly after being homeless and ending up in shared accommodation where I had nothing.”
£344,376
The past year has undoubtedly been one of the most difficult and most challenging for our teams. We have had to be adaptable, resourceful, and tenacious, and our colleagues’ commitment, dedication, and compassion have shone through.
Case study
LHP Financial Statements | 31 March 202210 throughTotalcustomersSupportingReportStrategicourvaluesecuredfortenantedhouseholdsmoneysupportinterventions:
Despite these difficulties, we are arguably closer to our customers than ever before.
“A couple of successful grant applications enabled LHP to purchase and deliver a cooker and fridge freezer, double bed and complete bedding packages including duvet, pillows, covers and sheets, towels, table and chairs, wardrobe, drawers, kettle, microwave, toaster, pots and pans, cutlery, and cooking utensils.
“LHP’s Money Support service provided me with food parcels from the food bank and made several grant applications to try and obtain funding for the essential goods that I required.
Staying connected and giving the best service possible
More than 150 people were contacted each week over the course of a year. In addition, we sent out over 80,000 emails to customers during the year, and our social media posts reached over 768,500 people.
The Group surplus, before changes to actuarial changes in the valuation of defined benefit pension schemes, was £6.5m, compared to a deficit of £7.8m at 31st March 2021.
ReportStrategic
Financial Review and Results Position
£39.9m to £42.4m, with cost of first tranche sales falling from £1.3m to £0.6m. (as per table shown on page 12). This has resulted in an operating surplus of £13.5m, compared to £16.2m last year and an operating margin of 24.57% (2021 – 29.63%).
Looking ahead, we are pleased to announce that we have been awarded contracts to provide more technology-enabled care in South Lincolnshire. We will keep working hard to improve our processes and technology so that we can provide integrated housing, care, and support services.
Turnover has increased by £0.2m to £54.9m (2021: £54.7m). Operating Expenditure has increased from
The financial results are set out on pages 51 to 100. The accounting policies of the Group are set out on pages 56 to 63 of the Financial Statements.
The group continues to produce a strong operational financial performance.
Group Financial Performance
LHP Financial Statements | 31 March 202211
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Interest and financing costs have reduced by £17.1m to £7.1m for year ended 31st March 2022 (2021: £24.2m, including break costs of £18.4m).
LHP Financial Statements | 31 March 202212 Strategic Report Consolidated Statement of Comprehensive Income 2022 2021 £’000 £’000 Turnover 54,910 54,690 Operating expenditure and cost of sales (42,378) (39,859) Gain on disposal of property, plant and equipment (fixed assets) 961 1,376 Operating surplus 13,493 16,207 Net Interest and financing costs (6,990) (24,100) Increase in Valuation of Investment Properties - 100 Surplus/ (Deficit) for the year 6,503 (7,793) DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Revenue reserve 74,256 57,986
Revaluation and restricted reserve 44,033 44,662
LHP Financial Statements | 31 March 202213
2022 2021 £’000 £’000
Pension liability (495) (9,381)
Total assets less current liabilities 333,441 341,087
Net book value of tangible and intangible assets 320,311 305,414
Comprehensive Statement of Financial Position
Total net assets 118,289 102,648
Total reserves 118,289 102,648
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Net current assets 13,130 35,673
Strategic Report
Loans and long-term creditors due after 1 year (214,657) (229,058)
LHP Financial Statements | 31 March 202214 Strategic Report 2021/2022 2020/2021 Actual Actual Interest Cover 168% 57% Net debt: NBV 45% 55% DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
During the year, the remaining £35m of retained bonds were sold, bringing the total bond debt to £150m, having previously sold £75m in 2014 and £40m in 2020. This provides further certainty of funding for the Group and de-risks interest rate exposure, leaving LHP with 100% fixed drawn debt at year end.
Private placement £15m £15m 4.1%
Facility maturity profile
As at year end, LHP had total RCF funding of £141m with an average weighted life of just over 4 years is in place, all of which was undrawn.
Bond £150m £150m 4.3%
The Group is funded by a combination of retained reserves, long-term funding from the capital markets and grant income.
Funding position
LHP reviews and updates its Treasury Management Strategy and Treasury Management policy on an
annual basis to ensure financial risks are managed effectively. Compliance with the treasury policy is reported to the board on a quarterly basis monitoring performance against golden rules covering lender covenants, interest rate risk and liquidity, helping to ensure continued financial stability.
LHP also signed a new RCF (Revolving Credit Facility) for £50m, during the year, which remained undrawn at the year end, further diversifying the groups funding sources and providing additional liquidity to fund LHP’s modest development program and investment
Bank RCFs £141m £141m CompoundedSONIA+1.1% £306m £165m £141m
LHP maintained a stable position throughout the year, underpinned by strong governance and a risk averse Treasury Strategy
In order to reduce the impact of refinancing risk in any single year, LHP ensure that maturity dates of facilities are staggered.
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portfolio at 31 March 2022 is summarised in the table below:
Total Facility Drawn(nominal)value Undrawn value Rate
Treasury Management
Strategic Report
LHP Financial Statements | 31 March 202215
Thestrategy.loan
The £15m Private replacement is due for repayment in eight years (FY 2030) and the bond repayments are amortised across ten years (2051 to 5060).
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LHP maintains a strong liquidity position reflected in its credit rating (S&P A). The year-end liquidity position (cash and undrawn facilities) was £160m, comprising of £19m cash and £141m of undrawn facilities. The
Liquidity
Strategic Report
LHP Financial Statements | 31 March 202216
LHP Treasury Policy ensures that sufficient liquid funds are maintained to cover committed capital expenditure for at least 24 months, whilst prioritising security of funds above yield.
LHP Financial Statements | 31 March 202217
• We continued to invest in Technology Enabled Care (TEC) through our Lincolnshire Telecare Service, which provides customers with additional needs the ability to live more independently
Investing in our communities
• Customers over 70 years old prefer using a tablet rather than a phone or computer
From the results of the customer survey that we undertook in 2021 as part of the planning towards our 2022-2027 Corporate Strategy, we know that amongst those who took part:
• 80% use the LHP online account
• The implementation of Touchpoint, an internal system that allows all phone calls, emails, and social media messages to our Customer Service Centre to be controlled from one area, providing quicker access to Customer Service Advisors
Our investment in new technology and platforms means we have built a strong digital foundation over the past three years, providing safe and secure systems and the ability for staff to work anywhere.
• In the last 12 months, we have invested in digital inclusion for our customers and provided several key improvements that allow them to have more control over their tenancy, and more ways of contacting us at a time that suits them. These include:
“Thanks to funding secured by Lincolnshire Housing Partnership, we have been able to move into a family home closer to town and local facilities, with a through floor lift that our daughter desperately needs to help her get around the house.
We will continue to invest in digital methods and have targeted by 2027 to have 60% of our customers as regular users of the portal or app, with 50% of our repairs being reported digitally.
• The merger of our legacy Housing Management Systems into one system, QL, has given us a singular view of the customer. This software allows us to provide more tailored communication to our customers through demographics, such as location, communication preference, number of people in the household etc.
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• 58% of customers said that home visits were their first or second choice of communicating with us
“She suffers from brittle bone disease, which means it is very easy for her to injure herself going up and down the stairs. A through floor lift makes her mobility around the home much easier and safer.”
• Nearly 80% of our customers have access to the internet
Strategic Report
Jessica LHP Customer, Grimsby
• The launch of our MyLHP customer portal and smartphone app that allows customers to control their tenancy from their computer or handheld device. By utilising the portal and app, customers can check their rent balance, report repairs and ASB, request a member of our teams to contact them about an issue and much more
• 75% prefer accessing LHP services via their mobile phones or the website
LHP Financial Statements | 31 March 202218
• Managers have coaching and listening skills that they use to give clear direction
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• We give back to the local and wider communities
Best Companies
All our employees were invited to take part in the confidential survey, feeding back on what we are like as a workplace, what we do well and what we can improve on.
• Employees feel rewarded for their contributions to the organisation
will allow us to follow one of our core corporate values of Listen, Act and Learn, meaning we can make LHP an even better place for our employees, which will translate to better services for our
Somecustomers.ofthe
was our One to Watch score from our initial Best Companies survey
“We’ve done everything we can to assist our colleagues with the challenges of the last year. Working hard to ensure we have the necessary equipment, procedures, and clear guidance in place, our people’s health and safety has been paramount in ensuring we can provide a full range of services to our customers and residents.”
Strategic Report
We were awarded the prestigious One to Watch accolade following the completion of the Best Companies survey in mid-2021.
areas that colleagues told us they wanted to celebrate through Best Companies included:
The uptake was excellent, with 83% of employees completing the survey. The results placed us just 0.4 points away from a coveted Best Companies one-star rating – a tremendous outcome from our first attempt at Best FeedbackCompanies.fromthesurvey
Culture & Digital 83% of colleagues completed the Best Companies pulse survey 615.6
Looking after our people
Suzanne Wicks Executive Director of Strategy,
• That we promote good wellbeing
The Investors in Diversity Award is a nationally recognised award that has been achieved by
LHP Financial Statements | 31 March 202219
The creation of the service has had a positive impact for us as an organisation, and our customers. In the last 12 months, significant development include:
Through the Investors in Diversity programme, organisations have been able to develop working environments that are inclusive, transparent and enhance how they communicate with a diverse range of people.
Moving forward, the team will continue to work strategically with partners and suppliers to deliver this vital service that improves the quality of life for so many customers. It enables them to live longer in their own homes or within our supported living accommodation.
We will be able to engage with staff across all our divisions and enable customers to “have their say”, on how we are doing in terms of FREDIE: Fairness, Respect, Equality, Diversity, Inclusion and Engagement.
Mrs. Dodson, Lincolnshire Telecare Service customer
Investors in Diversity
In 2021, we reviewed our Business Development Team and created an Integrated Telecare and Monitoring Service.
organisations across all sectors including other housing organisations, construction, and engineering; as well as other sectors such as education and charities.
• Worked closely with Tunstall Health UK on its panel for digital development
Partnership Work
• Created support pathways with the NHS’s Primary Care Networks
• Worked with AgeUK Lincoln & South Lincolnshire to a launch a self-install lifestyle package for Telecare products
As part of our ongoing commitment towards maintaining and developing a working environment that is welcoming to people from all backgrounds and abilities, we have embarked on a journey with the National Centre for Diversity that will lead us to achieving the Investors in Diversity Award.
The team settled well in their first 12 months, providing an end-to-end service with support pathways into our Integrated Living and Support Teams, and the NHS Urgent Community Response Service.
• Upgraded 181 partial scheme properties to the latest digital smart hub technology
• Onboarded St Barnabas Hospice, offering a digital smart hub support solution for lone workers
• Onboarded South Kesteven District Council, supporting over 1,100 of their residents using TEC products
“I first obtained a Lifeline Pendant when I was looking after my husband who had cancer. I suffer from arthritis, so I decided to keep using it, as it gives me peace of mind. I had a fall and fortunately my son was around to help me, but the second time I fell, I was able to press my Lifeline Pendant. Someone came to me very quickly, and they were able to help lift me off the floor using their specialised equipment.”
• Reviewed all 1,758 Telecare customer accounts, resulting in £32,000 additional revenue
• Implemented Direct Debit and pro-rata month in advance payment schemes
Strategic Report
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It has become clear that businesses like ours must change and adapt for the country to meet the decarbonisation agenda. The delivery of new homes has begun to change and will continue to change because of the use of Modern Methods of Construction (MMC), which includes off-site manufacturing of homes and the phase-out of gas boilers. With a greater emphasis on sustainable supply chains, we will change how we source and procure our development programme. These changes are only a part of the solution; retrofitting existing homes is just as important, if not more so, but it also presents different challenges. As a responsible organisation, we are carefully considering how homes can be retrofitted to meet the decarbonisation agenda without inadvertently increasing fuel costs for our customers, such as by replacing gas boilers with air source heat pumps.
Along with providing high-quality services, we are dedicated to keeping our customers safe and healthy in their homes. We welcome the increased focus on building safety in the aftermath of the Grenfell Tower tragedy, and we support the regulatory changes that will result in improved accountability for those responsible for residents’ safety, allowing them to feel safe in their homes.
Government policy on social housing
Building safety
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Environmental changes
Housing Crisis
Impact of Coronavirus
The pandemic’s impact on society will be felt for many years to come. The recent cycle of lockdowns has highlighted the importance of having a highquality home. Those who do not live in a high-quality home with access to green space have undoubtedly faced additional challenges because of Coronavirus. Along with the need to close the gap in lost education from the previous year and reduce hospital wait times, there must also be a greater emphasis on delivering homes where they are most needed.
LHP Financial Statements | 31 March 202220
At the heart of the Social Housing White Paper is a new Charter for Social Housing Residents. The Charter sets out seven commitments that residents should expect from their landlord: To be safe in your home and to know how your landlord is performing, including on repairs, complaints, and safety and to know how it spends its money. The White Paper will lead to an increased focus on what residents are saying and the way landlords engage with their
The Coronavirus pandemic has highlighted the scale of the housing crisis in the UK, as well as the disproportionate impact poor quality housing has on the health and wellbeing of people living in unsuitable or cramped conditions. The United Kingdom continues to face a shortage of affordable housing to meet demand. As we’ve seen with our own development programme, due to delays caused by the Coronavirus pandemic, fewer homes will have been completed in the last year.
tenants and how the resident voice is heard and acted upon within the organisation. We support this change in direction and, in response, have established a new Customer Forum during the year.
Responsible employer
The importance of our colleagues to the business has been highlighted more than ever in the last year. We are an inclusive employer dedicated to providing a safe and secure working environment with a competitive compensation package for all employees. Along with the assistance we provide to
our customers, we place a premium on the health and well-being of our employees. We have put in place a variety of support structures to assist our colleagues, not only because we believe it is the right thing to do, but also to ensure we can provide highquality services.
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Strategic Report
LHP Financial Statements | 31 March 202221
Corporate Strategy were formulated during the period of this statement. We believe that the launch of the new strategy after year-end means we can achieve even more, both as an organisation and in partnership with others.
Our Strategic Priorities for the duration of this report were: 1. Deliver quality services 2. Invest in existing homes and estates 3. Build new and homesregenerate 4. Listen to and empower tenants 5. Support and develop colleagues 6. Ensure strong governance and finance DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Our 2019-2023 Corporate Plan focused our efforts into delivering six key objectives. Our progress against those objectives is outlined in the following section. Preparations for launching our 2022-2027
LHP Financial Statements | 31 March 202222
We already make a positive difference to thousands of people’s lives, but we want to do even more. Our customers are at the centre of everything we do, and we intend to work even harder to identify what is most important to them and provide the support they need.
We’ll continue to be a leading housing group, developer and provider of care and support, investing in our communities and delivering integrated services where they are needed most.
Our strategic priorities
Strategic Report
LHP Financial Statements | 31 March 202223
• The MyLHP customer portal and smartphone app went live in August 2021, with our new corporate website following in September 2021
• Leaseholder team operation and providing specialist advice and support
• We consulted with customers on the Void Standard and agreed a single service standard
• Implement a customer online portal and smartphone app
Our strategies in action
Strategic Report
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• Review our Voids and Lettings process
Deliver quality services
• Roll out mystery shopping to provide a fuller insight into the quality of services provided to customers
Our Progress So Far
• Our new Housing Management System was launched in August 2021 and teams were restructured to allow for a community-based approach. We continue to tweak processes within the HMS to allow for more community-based work
• Mystery shopping is now in place with monthly reports to our Executive Team and a quarterly performance report to Board
• Leaseholder procedures and a leaseholder handbook are in place with communications made to all our leaseholders
• Introduce a single Housing Management System (HMS) and introduce community-based teams that provide a full service to customers
What our deliverables were in 2021/22
• We have analysed our SAP ratings and a SAP69 Plan is now in place. In addition, 85% of our homes are rated at C or above for their EPC energy efficiency rating. The rest of our properties will be reviewed in coming years. 92DC15E6-1623-4292-A6B1-F26216B0E1A2
What our deliverables were in 2021/22
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Our Progress So Far
Invest in existing homes and estates
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• Introduce a five-year electrical testing programme
• Our compliance reporting is now on a five-year cycle
• Identify a carbon reduction programme
• Return to Decent Homes Plus over a two-year period
• A funded Capital Programme is in place that will achieve Decent Homes Plus by 2023
Our Progress So Far
• The Development & Sales structure was reviewed in January 2022, and recruitment has now concluded
• A viable scheme is in place for Washdyke with consultation meetings arranged with local residents. Freshney Green’s Section 106 and planning are being reviewed to be carried into 2022/23
• The Development Programme delivered 93 units in 2021/22. 20 units were delayed and are included in the 2022/23 Corporate Action Plan 92DC15E6-1623-4292-A6B1-F26216B0E1A2
What our deliverables were in 2021/22
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Build new and regenerate homes
• Provide 181 new homes
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• Develop schemes for Freshney Green and the Washdyke Estate
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• Explore options for our development & sales function
Our Progress So Far
• We moved to the East Lindsey District Council lettings system in Q1 2021/22
Listen to and empower tenants
• Provide a single multi-channel customer contact platform
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• External accreditation for ASB
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• Estate walkabouts and engagement events are now booked in and promoted to customers
• We have achieved HouseMark accreditation for ASB
• We had moved 21.6% of key contacts to a digital offering by 31 March 2022
• Migrate 30% of key contacts to a digital offering by 31 March 2023
What our deliverables were in 2021/22
• Our call centre software is now integrated with Microsoft Teams. Social Media Connect is live and web chat is scheduled for launch in 2022
• Deliver estate walkabouts to engage with tenants and local communities
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• Move to the East Lindsey District Council lettings system
• Secure IIP Gold accreditation and enter Best Companies
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• Embed agile working as part of our culture
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Our Progress So Far
• Invested in staff to develop their skill sets through a Corporate Training Programme and Management Development Programme
• IIP accreditation due in September 2022
• Appointed apprentices across different departments, providing them the opportunity to learn whilst ‘on the job’
What our deliverables were in 2021/22
• Agile working strategy embedded within the organisation
• Train staff to use and maximise the new HMS system
• Launch management training and trainees/ apprentices’ schemes
• Started the Investors in Diversity journey with the National Centre of Diversity
Support and develop colleagues
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• Completed an initial Best Companies Pulse Survey and were awarded One to Watch status
Our Progress So Far
What our deliverables were in 2021/22
• Completion of the Treasury Management & business planning restructure
• Improve financial planning and reporting to better inform and report on decisions for Board, ELT, and budget holders
• Prepare for new regulatory framework and Code of Governance
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• Developed an Annual Strategic Planning Cycle (ASPC)
Ensure strong governance and finance
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• Establish sustainable treasury and business planning function
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• Integrated financial viability and performance reporting
The Board leads the Value for Money (VfM) approach, through setting the Corporate Strategy and approving the business plan and annual budget. The financial planning process ensures that LHP achieves a healthy balance between delivering customer satisfaction, maintaining quality homes, creating a supply of new housing, and providing a great place for employees to work whilst ensuring the financial health of the Theorganisation.Regulator of Social Housing published a VfM Standard in 2018. The standard set out the requirement to have an approach agreed by the Board to achieve VfM in meeting the strategic objectives and that demonstrates delivery of VfM to the Duringstakeholders.2021/22the
We have continued with our programme of understanding how our properties are performing and during 2022/23 will see us evaluating our options on key schemes and fallow land to ensure that we are optimising what they can provide for the benefit of our customers and our financial viability.
Ensuring efficiency savings within the business plan are specifically identified and can be successfully planned for.
Board approved a refreshed approach to improving value for money which included more frequent monitoring of the RSH (Regulator of Social Housing) VfM metrics and inclusion of VfM measures in its suite of core KPIs (key performance indicators).
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Value for Money (VfM)
During 2021/22 we generated better VfM from our funding facilities through the sale of the remaining £35m of retained bonds in June. This allowed LHP to take advantage of the low interest rate environment whilst minimising exposure to further interest rate rises.
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The Board maintains direct oversight and control of progress made in delivering our value for money commitments via:
• External benchmarking e.g., Housemark, Global Accounts and external publications,
Board oversight
• Quarterly performance monitoring of a suite of KPIs that demonstrate delivery of our strategic priorities.
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• Bi-annual internal reporting against the VfM metrics prescribed by the RSH.
The implementation of the single housing management system, replacing the two legacy systems, is providing the opportunity to have better insight into the costs and is forming the foundation to transforming the way in which we deliver our service to our customers and increase customer satisfaction.
• Quarterly financial monitoring of performance against our budget and business plan.
• Engagement with our customers to involve and obtain feedback on our VfM progress, including through our satisfaction survey process and our tenant forums.
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The performance against the metrics required by the Regulator of Social Housing is presented below, benchmarking against the 2021 Global Accounts
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Value for Money metrics
Value for Money (VFM) is intrinsic to the delivery of our strategic priorities and this document sets out our approach to ensuring we make the best possible use of our resources to maximise the available investment to support each of our priorities and that each pound spent delivers the best outcomes for our tenants in delivery of our corporate plan.
our delivery of procurement activities, LHP has strengthened its approach to ensuring VFM is achieved at all stages, from the outset of commencing new procurement activity ensuring that the initial Invitation to Tender has the right focus on quality, value and delivery, seeking to optimise value for money. continuing through the lifetime of the contract, LHP’s approach to contract management
Strategic Report
continues to evolve, with a recently launched new contract management framework supporting effective contract management which in turn will ensure LHP customers receive quality and value throughout the duration of a contract. Procurement at LHP is a pivotal role in making sure resources deliver cost efficient and continuous effective outcomes.
Throughmedian.
To further support our ESG objectives where appropriate a customer centric approach is taken to provide opportunities for customer involvement on procurements that have a direct impact. All new procurement activities require the bidders to put forward ESG commitments that offer Social Value within our communities, and an indication of how they can support LHP in achieving delivery of the ESG strategy; through supporting sustainability through reducing environmental impact of operations, and what added social benefit they will bring through supporting employment opportunities and community investment.
Metric 2B New Supply Delivered – Nonsocial housing units
Metric 6A Operating Margin - Social housing lettings only 21.88% 21.71% 27.20% 26.30%
This metric assesses how much of the adjusted assets are made up of the debt and the degree of dependence on the debt finance. Gearing was 55.51%, a slight increase from 55.24% in 2021. This is higher than the 2021 sector median.
Metric 4: EBITDA MRI
This unit cost metric assesses the headline social housing cost per unit as defined by the Regulator. LHP has increased its social cost per unit to £3,813 from £3,156 in 2021, primarily due to the increase in capitalised component replacement spend. This is slightly higher than the 2021 sector median of £3,730.
Metric 3: Gearing %
Metric 5: Headline Social Housing Cost per unit
Metric 6A: Operating Margin – Social housing lettings only
This demonstrates the profitability of operating assets before exceptional expenses are considered. Social housing lettings were at 21.88% lower than 27.20% in 2021.
Metric 5 Headline Social Housing Cost per unit £3,813 £3854 £3,155 £3,730
Metric (Adjusted)4
Metric 4 EBITDA MRI 98.90% 66.09% 56.67% 183.00%
Metric 4 - EBITDA MRIadjusted to remove loan break costs 234.77%
2022 Actual 2022 Budget 2021 Actual Median2021
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This is a key indicator for liquidity and investment capacity. It measures the level of surplus that LHP generates, excluding depreciation and compares it to the interest payable. LHP is reporting EBITDA MRI of 98.90%, being significantly higher than 56.67% reported in 2021.
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Metric 1 Reinvestment % 7.58% 8.06% 5.93% 5.80%
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Metric 6B Operating Margin (overall) 22.82% 22.97% 27.12% 23.90%
This metric looks at the investment in properties, both existing stock and new supply as a percentage of total value of properties held. LHP reported 7.58%, which is above the 2021 sector median of 5.80%. This demonstrates our significant investment in our existing stock, and our modest development programme.
Metric 3 Gearing % 55.51% 55.57% 55.24% 43.90%
Metric 1: Reinvestment %
This metric is the number of new housing units acquired or developed in the year as a proportion of total social housing units and non-social housing units owned at period end. During the year LHP added 56 social rented properties, 21 shared ownership properties, and 16 Other Social Housing to its stock.
Metric 2A: New Supply Delivered - Social housing units
Metric 7 Return on Capital Employed 4.05% 4.01% 4.75% 3.30%
Metric 2A New Supply Delivered - Social housing units 0.76% 0.40% 0.73% 1.30%
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Metric 6B: Operating Margin (overall)
The overall Operating Margin demonstrates the profitability of on-going operations, excluding surpluses on fixed asset sales. The 2022 performance is 22.82%, being lower than the previous year (27.12%) and below 2021 sector median (23.10%).
The Return on Capital Employed gives an indication of how well LHP makes a financial return on the assets it owns. For 2022 the performance was 4.05%, which is better than the 2021 sector median (3.30%) but slightly lower than 2021 (4.75%).
Metric 7: Return on Capital Employed
Demonstrating Value for Money to our Residents is a clearly stated priority within our corporate plan. Our strategy is to reduce our overhead costs and reallocate savings made to areas that matter most to our customers and delivering lower cost repairs through our in-house repairs service.
LHP obtained the regulatory judgement of G1/V2. LHP has improved its controls and processes to ensure the accuracy of business plan data, board reporting and regulatory returns. LHP’s approach to stress testing and mitigation strategies has also been LHP’sstrengthened.comprehensive
The Board acknowledges it has ultimate responsibility for ensuring that the Association has in place a system of control that is appropriate to the various business environments in which it operates. The Board recognises that the internal control system can provide reasonable but not absolute assurance against material misstatement or loss and are committed to continuous improvement in our internal control processes.
The LHP board has a sustained focus on maintaining a robust approach to governance and regulatory considerations, with an effective risk management framework a pivotal tool in ensuring there are robust systems and processes in place to identify, evaluate and manage key business risks. The strategic risk register is reviewed quarterly by Board and the Audit and Risk Committee, further committee scrutiny is given to the risks within the area of responsibility at each meeting.
process of assurance across all six areas of Landlord Health & Safety, incorporates internal and external testing on both a quantitative and qualitative basis.
Internal Control and Risk Management
delivered improvements in performance,
The Financial Regulations are reviewed and remain suitable for the business and operation of the Association; The Financial Regulations are supported by a framework of policies and procedures with which the employees must comply. These cover issues such as treasury management, health and safety, data and asset protection and fraud prevention and detection.
providing assurance in the areas of Business Asbestos Management, Lift Management, Major Incident Planning, Tenancy Management and Business Planning, Stress Testing and Covenants.
The system of control is designed to manage key risks and to provide reasonable assurance that planned business objectives and outcomes are achieved. It also exists to give reasonable assurance about the preparation and reliability of financial and operational information and the safeguarding of the Association’s assets and interests. The Board retains overall responsibility for the governance of the organisation, with appropriate delegation to four committees: The Audit & Risk Committee, the Operations Committee, the People & Governance Committee, and the Finance Committee. The Finance Committee was introduced to ensure a robust focus is given to the Financial Governance of the organisation.
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The Committees consider a range of strategic, financial and compliance issues as defined in the Association’s Standing Orders. The Board continued to operate under the National Housing Federation
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KPMG are LHP’s internal auditors. KPMG tailor the annual audit plan to align with our strategic risks and broader regulatory environment that ensures a bespoke approach to organisational need. In developing the audit plan KPMG considered LHP’s current sources of assurance and prioritised reviews where any assurance gaps were noted.
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Code of Governance 2015 for the financial year ending 2022, adopting the National Housing Federation Code of Governance 2020 from April 2022. LHP has strengthened its Board and welcomed new members with strong skill sets in Finance, Governance Management, and digital transformation.
During the year, action was taken in relation to all identified audit recommendations, and progress was monitored by the Executive Leadership Team and the Audit & Risk Committee, with KPMG sample testing a series of implemented recommendations to ensure Thiscompliance.process
Internal Audit
WhistleblowingReportStrategic
Over the course of the year the Board has actively considered and assessed the key strategic risks facing the organisation and responded to information presented by the Executive. The key financial risks are built into the process of stress testing, conducted on a quarterly basis, and consider single and multivariate scenarios. This approach moved to a quadrant methodology to stress testing, at the latter part of the financial year, this reduces the number of single variant tests to focus on key risk factors for LHP, then complemented by 4 multi-variant tests designed on the quadrant-based approach. Mitigating strategies have been identified where the results of the stress tests indicate a detrimental outlook for LHP.
The table on the following page summarises our principal risks. Assurance over the control of risks is achieved through continuous review and ongoing actions to ensure mitigations are in place to prevent crystallisation.
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Our approach to risk management is supported by a robust Internal Audit Program undertaken by KPMG and a complementary suite of process compliance reviews undertaken across all areas of the organisation by our internal Risk and Assurance Team. LHP operates to a robust key control framework, with assurance on its effectiveness assessed through
Effective management of risk is an integral part of how LHP operates. LHP has an established comprehensive Risk and Assurance Framework, which is fully embedded across the organisation operating at both a strategic level and across all operational departments.
LHP considers its risk profile against the Sector Risk Profile on an annual basis, and we have identified the key risks that could impact on the achievement of our corporate objectives, The Board also considers its appetite for different types of risks on an annual basis.
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The Group’s Whistleblowing policy enables employees to raise issues on a confidential basis. Procedures exist to ensure any whistleblowing incidents are independently investigated promptly.
Our single consolidated performance and risk management system, allows for succinct reporting with a holistic approach.
All organisations face a level of risk in all the things that they do. The diverse nature of a social housing provider’s activities means that the organisation faces different types of risk that require different responses.
Failure complianceof –Gas, AsbestosLOLER,Legionnaires,Electric,and fire safety
• Attractive T&C packages – Employer of Choice
• Building security
• Taking a risk-based approach to identified issues with cyberattack log and processes kept
• Robust working partnerships with local partners.
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• Clear understanding of exposure to pension costs and options for securing certainty.
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• LHP has taken a conservative view on income inflation built into the business plan. For cost inflation LHP has used Centrus’s forecasts and added a further risk margin on top LHP carry out robust stress testing
Uncertainty in defined benefit pension cost
• ICT Security policy, DPA policy and accompanying procedures
• Sophos anti-virus
• Dark trace, multi-function authentication and VPN in place
Governance and Regulation Cyber breachSecurity
• Customer involvement and empowerment Strategy.
• Together with tenant’s customer charter and strong Scrutiny panel.
• MGI (Mary Gober International) staff training.
• Web and email filtering in place
• Early modelling of high inflation and potential rent cap. Early consideration of cost control requirements
• Operational reporting on daily status of all areas
Business Delivery
Financial Viability Costs & Inflation rises
• Complaints & ASB policies.
Reputation Customers and Stakeholders Risk communicationstandardsanddissatisfactioncustomerofpoorof
Key Risk Area Risk Controls & Mitigations
Asset Health & Safety Compliance
• Quarterly Business Plan stress testing.
• Suite of compliance policies in place
• Specialist qualitative testing
Inability to retain staff causing difficulties in the delivery of objectivescorporate
• Organisational development program in place & regular pay benchmarking 92DC15E6-1623-4292-A6B1-F26216B0E1A2
• Inflation and interest rate assumptions derived from OBR forecasts.
• Current expected Business Plan performance is updated quarterly and reported to the Board.
• HouseMark and Housing Ombudsman Accreditation
• Multi skilled staff
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• Mystery shopping.
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In response to the pandemic, we have developed new agile, innovative ways of working. We have also been assisting with loneliness and mental health issues exacerbated by national lockdowns and Coronavirus restrictions. The Board has also adapted to the pandemic, with some Board and Committee meetings now taking place virtually via Microsoft
The Coronavirus pandemic has again dominated the last 12 months. Its impact has touched every aspect of life in the UK and around the world in some way. We have been no exception; throughout the pandemic, our priority has been to keep both customers and colleagues safe.
ThroughoutTeams.
Other changes to our operating environment have occurred in the last year, necessitating the Board’s attention. The Social Housing White Paper, which was published in November 2020, was a commitment from the government to provide transparency and accountability from landlords to Wecustomers.launched
This change to the delivery of meetings has not hampered discussion or debate, and meetings have remained focused and strategic. In fact, operating in this way has opened more opportunities for smaller strategic discussion sessions and development for members using online meetings and webinars.
the FREDIE (Fairness, Respect, Equality, Diversity, Inclusion, and Engagement) framework in January 2022. Environmental changes in both development and within our existing homes have also been featured on the Board’s agenda.
tointroductionChair’sReportStrategicgovernance
this period, the Board has provided support to the Executive Leadership Team, ensuring that timely, responsive decisions were made in the fast-paced, changing environment that presented itself. Whether at one of our offices, or in the homes of colleagues, the emphasis has been on ensuring that people’s wellbeing and safety are at the forefront of all activities and services.
The Board is committed to delivering its ESG Strategy, digital inclusion and addressing the many other challenges that our customers face.
Our approach to governance was endorsed when we obtained a G1/V2 rating from the Regulator of Social Housing, demonstrating the Group’s commitment to excellent governance and financial vigour.
Furthermore, changes in our operations over the last 12 months have helped shape and form new strategies to enable more flexible, agile working, which benefits both colleagues and customers.
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Boston Mayflower Finance PLC is a special purpose vehicle incorporated for the purposes of raising finance and is without any assets of its own.
Speedwell Homes Ltd’s purpose is to manage a small number of market rent properties.
The LHP Group
Humber Homes Limited is a non-trading company that was set up as part of the mechanism for the redevelopment of the former Yarborough Estate now known as Freshney Green.
LHP is the parent company of three wholly owned subsidiary companies. These subsidiaries are Humber Homes, Speedwell Homes, and Boston Mayflower Finance Plc.
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Relationships and controls between LHP and the Group are governed by agreements which includes intercompany services and charges.
Social Housing and Homes England. We must comply with the Standards that together form the Regulatory Framework. We are also regulated by the FCA as a Community Benefit Society.
The Board is well-equipped to provide the right balance of leadership and oversight, working well with the Executive Leadership Team, offering support and robust challenge. As a responsible provider of
LHP is a charitable community benefit society. This means we have shareholders. Shareholders meet annually and at general meetings. The shareholders appoint the Board. How general meetings and the Board operate is governed by Rules. Board Members act as both directors of the company and shareholders and are subject to common law principles of company law and legislation under the Co-operative and Community Benefit Societies act
homes and support services, the Board considers its compliance responsibilities as a key part of its performance.
We are required by The Regulator for Social Housing to adopt an appropriate code of governance. We have adopted the National Housing Federation Excellence in Governance Code 2015 edition.
Regulation
LHP is a charitable Community Benefit society registered under the Co-operative and Community Benefit Societies Act 2014. As a registered provider of social housing, we are regulated by the Regulator for
We2014.are also an exempt charity. The Rules set out the purposes and powers of LHP as an exempt charity which must be complied with. The Board Members act as trustees of the charity as well as also being directors of the company. This dual role has largely similar rights and obligations to comply
The Group’s chosen code of governance
Our constitution
The Rules are the most important document in our Constitution. Other documents which sit below the Rules and form part of the Constitution are Terms of Reference for Board and Committees, the Scheme of Delegation to the Executive, Financial Regulations and Procurement (contract) Rules.
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with. Whenever our Board acts it must take account of what is best for the beneficiaries of the charity (our tenants primarily) and the long-term interests for the success of the company.
Strategic Report Compliance statements
The Code sets down key principles, with which we must comply, and supporting best practice recommendations where we have some discretion. Where we do not follow the code, we must explain why not.
The Code deals with our Board, the way it operates, our constitution, the role of the Chair, the Chief Executive, equalities, and probity. In fact, everything which you would expect to see in a well-run Board and organisation. Each year we review whether we fully comply with the NHF (National Housing Federation) Excellence in Governance Compliance Report and report this through to our Board.
We are committed to adhere to policies and work to governance standards. You can read our governance documents and policies which form our Constitution in the openness and transparency section.
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All these regulators have various statutory requirements which we must comply with. They have rights of inspection and intervention in our dealings if
Board Member code of conduct
we get things seriously wrong and we are obligated to supply prescribed information to them.
main governance documents which support the Rules. They set out the terms of reference of the Board and its committees and how meetings are conducted. They also provide the scheme of delegation of decision making to the Executive to deliver services in line with Board’s set priorities.
The Constitution sets out how LHP is governed and, in addition to the Rules, includes Standing Orders, Terms of Reference, Scheme of Delegation and Financial Regulations. These set out the strategic and operational management and decision-making processes for the Board, its committees and its Theyemployees.arethe
There are also other provisions dealing with key roles such as the Chair and Chief Executive, financial control and audit, and statutory and miscellaneous matters.
The Standing Orders
The Rules
or dividend. The Rules specify who is unable to be a shareholder and how shareholding ends. Rules relating to the Board sets out its composition, quorum, terms of office, meetings, and declarations of interest amongst other matters.
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The Rules of LHP are the basis of its Constitution and follow the model of the National Housing Federation Model Rules 2015. Effectively the Rules are very similar to the Articles of a Company. They set out LHP’s charitable objects which are primarily founded on providing affordable homes for those in need for the benefit of the community. The Rules set out LHP’s powers for shareholders and the Board. There are detailed provisions dealing with the shareholders and holding general meetings. Each shareholder has a share worth £1 which does not attract interest
The Financial Regulations set out LHP’s financial management controls including accountancy,
audit standards and procedures. The Regulations also govern how contracts procured and managed in conjunction with Procurement Rules. The Procurement Rules ensure that we secure VFM through appropriate levels of competition for goods and services we need to deliver our services.
Without such robust documents we would be unlikely to meeting the regulators standards of governance or comply with legislation.
Members’ Code of Conduct sets out Board Members’ responsibilities in respect of acceptable behaviour and accountability and therefore is important in setting the culture for LHP and the leadership role of the Board.
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We are committed to adhere to policies and work to governance standards and to be open and transparent which is a key principle of good governance. This is why we openly publish our documents so you can see the way we operate.
We have adopted the National Housing Federation Code of Conduct. The conduct of Board Members impacts directly on our public reputation. Proper conduct by the Board can dictate how effectively our money and assets are managed. The Board
Statement sets out at a high level LHP’s Statement as to how it intends to comply with the Act with particular emphasis on procurement rules, processes and procedures and supply chains, and raising awareness.
How we are governed
them throughout the organisation by leading by Whileexample.the
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Coronavirus has had an impact on all areas of operations, for both colleagues and customers, it has not come at the expense of our values; in fact, the pandemic has resulted in a greater emphasis on values throughout the organisation.
Organisations with an annual turnover of at least £36m are required by the Modern Slavery Act 2015 to publish a Statement setting out what they are doing to stop modern slavery and forced labour practice occurring in their business and supply chains. The
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Modern Slavery Statement
While our strategic priorities and performance are outlined in the Corporate Strategy, the Board believes that maintaining the highest levels of governance is critical to the organisation’s success. Good governance is more than just following the rules; it is also about fostering and promoting the right culture and behaviours. As a result, board members are equally committed to our values and serve as role models for the rest of the organisation, embedding
Strategic Report Committee Structure
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Our OurIntroductionleadershiptotheboardboard
As a result, each Board member is given a clear ‘role description’ outlining the duties that are expected of them. Any Board member who holds the position of Chair receives additional responsibilities as part of their role description, outlining how they are responsible as the Board’s leader. As part of their induction, board members are advised of their fiduciary duties, and they receive regular training and development sessions on their responsibilities. The Board has the primary and ultimate decisionmaking authority, though it does delegate some responsibilities to Committees within the structure.
Audit & CommitteeRisk CommitteeOperations People Governance&Committee CommitteeFinance CustomerScrutinyPanel DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
A well-functioning and effective Board of Directors is an essential component of good governance. The Board should understand its role and responsibilities and carry them out to the best of its ability. Each Board member is expected to demonstrate their skills, knowledge, and experience, which, when combined with the rest of the Board, improves the Board’s effectiveness.
LHP Board
passion for customer service, Anthony also has extensive experience in property finance, risk assurance and debt management.
Carl has extensive knowledge of asset management and a passion for customer Heexcellence.iscurrently the Director of Maintenance Services at Southern Housing Group, responsible for the strategic and operational leadership of the in-house direct labour repairs and maintenance service.
Strategic Report
He has a variety of business skills, including financial management, leadership and development, sales and marketing, governance and health and safety compliance.
Jiggy is an independent adviser to organisations on sustainability strategy, sustainable development, and public policy. She also writes on environmental Priorhistory.to
Carl BoardDeweyMember / Chair of the Operations Committee
His own consultancy business provides non-executive and advisory support to several SMEs across a diverse range of sectors. He is also Chair of the Audit Committee and Senior Independent Director of Peaks and Plains Housing Trust.
Anthony has extensive experience of banking and finance with a career spanning more than three decades. His comprehensive skill set includes considerable experience of customer relationships and leadership roles where he built highperforming teams across various disciplines on a regional and national basis and coached and mentored senior leaders on business issues and change Withmanagement.agenuine
setting up her own consultancy, Jiggy held senior posts in UK and multinational companies.
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She has a strong interest in conservation, helps her partner run their wildlife-friendly farm, supports the running of a local community centre and is an associate of the environmental policy think-tank Green Alliance.
A chartered builder by profession and a Fellow of the Institute of Directors, Carl is a board level executive with over 25 years’ experience within the social housing sector.
Jiggy BoardLloydMember
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Meet the BoardAnthonyReadChair
She is passionate about the delivery of quality affordable housing services and building strong communities. Throughout her local government career, she has worked in partnership with housing associations to deliver affordable housing programmes in both Lincolnshire and more recently Hertfordshire.
Sally is a Housing and Accountancy professional, who is an experienced public sector leader. Her significant financial and governance experience has been gained from a 34-year career in Local Government, including 22 years at Director level, as both a Director of Housing and Director of Finance and more recently for the last 7 years of her career as a Local Authority Chief Executive.
Paul BoardCaseyMember
Kate BoardLindleyMember / Chair of the People and Governance Committee
She has a track record of turning around service and organisational performance and governance and led cultural change programmes which have included digital transformation and introduction of agile working.
Over the last 10 years he has been engaged in many successful merger situations. As Chair of Audit and Risk for Hundred Houses Society in Cambridge, he has led on regulatory in-depth assessments and became a founding member of the Eastern Region Chairs of Audit and Risk group.
Sally BoardMarshall-MillsMember
on a council estate in Greater Manchester and is passionate about providing responsive and reliable services to tenants and about addressing inequality, including through the provision of secure, affordable, good quality housing. Kate is married with three older children.
John BoardCrowtherMember / Chair of the Audit and Risk Committee
Kate has more than 20 years of experience leading customer focused operational services and business transformation within both local authorities and the housing sector.
KatePartnership.grewup
Paul has more than 30 years’ experience in the social housing sector.
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She currently leads Customer Transformation for Socitm Advisory, specialising in digitally enabled business transformation. Previously Kate has held senior roles at Civica, a global IT-based services provider, at a number of unitary local authorities and at The Guinness
During her career she has successfully led the delivery of regeneration schemes having worked with public and private sector partners to develop strategic partnerships which have successfully unlocked long term economic growth.
Currently director of an affordable housing consultancy (HALO) that provides development and asset management services to small developers; specialist asset management organisations and several social housing providers, Paul is Director of Property and Assets at Horizon Infrastructure Partnership, a national asset management company
LHP Financial Statements | 31 March 202243
John is an experienced Finance Director of many registered providers throughout the UK. Acting as a specialist interim solution he has been part of the executive team at organisations ranging from 1,000 to 30,000 homes.
HeUniversity.isalsoa
Simon Parkes Board Member / Chair of the Finance Committee / Senior Independent Director (SID)
Nicola has over 20 years’ experience of working as a qualified senior corporate governance professional with regulatory, compliance, planning and performance expertise. She has also been a Data Protection Officer, with expertise in data protection for over 6 years.
Nicola CompanyEbdonSecretary
Her experience spans charity, regulatory, professional body, and trade union services with a focus in leading project and programme delivery, facilitation of change and champion of continuous improvement, equality, diversity, and inclusion. 92DC15E6-1623-4292-A6B1-F26216B0E1A2
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Simon is the Chief Operating Officer at the University of Lincoln, where he is responsible for most of the professional services (Finance, HR, Digital etc.) for the
Murray has more than 15 years’ experience leading social housing organisations, and culture and is responsible for directing the company, preparing, and implementing both our strategic and operational plans.
Murray is committed to delivering excellent services to tenants and partners.
Murray Macdonald Chief Executive
LHP Financial Statements | 31 March 202244
non-executive director and Chair of Audit, Risk and Governance at the North Lincolnshire and Goole NHS Trust and Chair of the Finance Committee at Lincoln Cathedral.
Our45 Executive Team
In her spare time there are two grandchildren, border terriers, a little antique dealing, and her garden to keep her occupied.
Suzanne has over 25 years’ experience of working in the housing association and local government sectors. Her experience spans both operations and back-office services at various levels and in the last 12 years she has focussed on business and digital integration and transformation.
Kathryn ExecutivePriceDirector of Finance
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With proven experience in the charity, housing and commercial sectors, Kathryn has undertaken consultancy assignments and senior positions delivering improvements to financial viability, value for money and business capability.
With a career in Housing Asset Management, Maintenance and Development stretching back to 1994, Alex brings with him a demonstrated history of working in housing and development, particularly within teams that use innovative approaches to housing.
After 22 and a half years’ service, Bridget took a well-deserved retirement on 30 June 2022.
Previous roles have included Executive Director of IT & Private Sector Services, Managing Director of leasehold and PRS management subsidiary and Managing Director of her own consultancy company.
The Executive Team has a wealth of experience from both inside and outside of the sector. While each member has responsibility for their own function, together they ensure that the strategic goals of the organisation are achieved. They work with colleagues and stakeholders to deliver the Group’s objectives, each using their areas of expertise to work together. On a day-to-day basis, the team oversees the running of the business, creating and delivering the Group’s business plan, improving performance, developing organisational culture, and acting as a go-between for the Board and the business. The Executive Team comprises five members, including the Chief Executive, Murray Macdonald.
LHP Financial Statements | 31 March 2022
Alex ExecutiveDixonDirector of Property
Kathryn is an experienced commercial finance director, leader, and qualified coach. Her expertise is in delivering sustainable change to improve business performance.
Alex has a strong background in management and development, having previously held directorship positions with Freebridge Community Housing in Kings Lynn and Bromford Housing Group in the West Midlands.
Bridget ExecutiveLloydDirector of Customers
Bridget is a housing professional with 20 years’ experience with previous portfolios ranging from governance to complaints. Her passion is people, their right to be heard and listened to, treated fairly, to have equality of opportunity and experience excellent customer service.
Suzanne ExecutiveWicksDirector of Strategy, Digital and Culture
Progress: Agreed to change quarterly meetings to the first Tuesday of February, May, and November
Strategic Report Key Board activities
Annual Strategic Planning Cycle
Progress: The skills outlined became areas of focus for the recruitment process for three Board Members. LHP sought proposals from three suitably skilled agencies to conduct the recruitment for three members to sit on the Board. The recruitment to the customer vacancies on the Operations Committee was incorporated through this process. A focus on diversity in its broadest sense was built into the brief to appoint a suitably qualified consultancy who has a track record in attracting a diverse range of candidates when recruiting for non-executive roles.
Board Skills & Succession Review
Employee Pay Increase
Designed to align the strategic and financial planning which addressed the learning from both last year’s internal planning process and from the Campbell Tickell (CT) Lessons Learned Report.
Progress: Considered and approved the proposed changes to the Rules including the removal of the previous Rules C3, C7 and C8.
LHP Rule Amendments
Environmental, Social and Governance (ESG) Performance Review
LHP rules presented for approval, following a review by Anthony Collins Solicitors (ACS) to affect the following governance changes: Closed membership (where only Shareholders are Board Members); Removal of the AGM requirement; Virtual meeting provisions; and Board member terms of office amended to reflect the NHF Code of Governance 2020.
Report presented on the proposed employee pay increase following the latest review of benchmarking information and options considered by ELT.
Progress: Approved moving the targets for adding SMART objectives to the Procurement Strategy Action Plan from June 2021 to October 2021 and noted the progress with delivery of the ESG Action Plan and the SRS reporting.
Progress: Board approved: all employees (excluding Executive) be awarded a 4% pay increase.
LHP Financial Statements | 31 March 202246
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A review from Campbell Tickell on Board Skills and Succession Planning recommended four key areas for consideration.
A report was provided to Board with an update on the delivery of the ESG strategy action plan and included the first attempt at completing the Sustainability Reporting Standards (SRS) core criteria.
All the current Board members have taken the steps that they ought to have taken to ensure they are aware of any information needed by the Group’s auditor for the purposes of their audit, and to establish that the auditor is aware of that information.
Anthony Read Simon Parkes
Viability Statement
For this reason, they continue to adopt the going concern basis in the preparation of these financial statements.
The Strategic Report has been prepared in accordance with applicable reporting standards and legislation. The Board can also confirm that the Group has complied with the Regulator of Social Housing’s Governance and Financial Viability Standard.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Provision of information to the Auditor
operations for the foreseeable future.
• Sufficient liquidity is in place to meet our internal liquidity policy.
Strategic Report
• A robust range of Covid-19 and inflationary increase stress testing has been undertaken and no breaches in financial covenant or internal golden rules are forecast.
Having considered the plans and forecast of LHP and taking account of the advice received over the year from independent professional advisers on the business activity and the continued support of its funders, the Board has a reasonable expectation that the Group has adequate resources to continue
Statement of Compliance with Regulatory Standards
LHP Financial Statements | 31 March 202247
• Limited use of Government furloughing scheme.
The Board members are not aware of any relevant audit information of which the auditor is not aware.
Financial Response
Nicola Ebdon Chair Board Member Company Secretary
Going Concern
The Board have assessed the risks associated with the departure from the Covid-19 pandemic and the recent inflationary increases on LHP and concluded that there is limited negative impact to the ongoing business activity.
• Give a true and fair view of the state of the Group’s and of the Association’s affairs as of 31 March 2022 and of the Group’s income and expenditure and the Association’s income and expenditure for the year then ended.
In our opinion, the financial statements:
Independent Auditors’ Report to the Members
Our responsibilities and the responsibilities of the Board with respect to going concern are described in the relevant sections of this report.
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In auditing the financial statements, we have concluded that the Board’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
We have audited the financial statements of Lincolnshire Housing Partnership Limited (the Association) and its subsidiaries (the Group) for the year ended 31 March 2022 which comprise the Group and Association Statement of Comprehensive Income, the Group and Association Statement of Financial Position, the Consolidated Statement of Changes in Reserves, the Consolidated Statement of Cash Flows, and the notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in
Conclusions relating to going concern
Basis for opinion
the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Group and Association in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
• Have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
• Have been prepared in accordance with the requirements of the Co-operative and Community Benefit Societies Act 2014, the Cooperative and Community Benefit Societies (Group Accounts) Regulations 1969, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2022.
LHP Financial Statements | 31 March 202248
Independent Auditors’ Report to the OpinionMembers
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The Board of Management is responsible for the other information. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s or the Association’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Extent to which the audit was considered capable of detecting irregularities, including fraud
Independent Auditors’ Report to the Members
Responsibilities of the Board of Management
• The financial statements are not in agreement with the books of account; or
As explained more fully in the Statement of the Board’s Responsibilities set out on page 8, the Board of Management is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Board of Management determines is necessary to enable the preparation of financial
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
We have nothing to report in respect of the following matters in relation to which the Co-operative and Community Benefit Societies Act 2014 or the Housing and Regeneration Act 2008 requires us to report to you if, in our opinion:
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• The Association has not kept proper accounting records; or
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org. uk/auditorsresponsibilities. This description forms part of our auditor’s report.
statements that are free from material misstatement, whether due to fraud or error.
• We have not received all the information and explanations we require for our audit.
In preparing the financial statements, the Board of Management is responsible for assessing the Group’s and the Association’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Management either intends to liquidate the Group or the Association or to cease operations, or have no realistic alternative but to do so.
We have nothing to report in this regard.
• A satisfactory system of control over transactions has not been maintained; or
Matters on which we are required to report by exception
LHP Financial Statements | 31 March 202249
In connection with our audit of the financial statements our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken based on these financial statements.
Use of our report
LHP Financial Statements | 31 March 202250
• The risk of fraud and non-compliance with laws and regulations was discussed within the audit team and tests were planned and performed to address these risks. We identified the potential for fraud in the following areas: laws related to the construction and provision of social housing recognising the regulated nature of the Group’s activities.
• We reviewed financial statements disclosures and supporting documentation to assess compliance with relevant laws and regulations discussed above.
• We gained an understanding of the controls that the Board have in place to prevent and detect fraud. We enquired of the Board about any incidences of fraud that had taken place during the accounting period.
• We obtained an understanding of laws, regulations and guidance that affect the Group and Association, focusing on those that had a direct effect on the financial statements or that had a fundamental effect on its operations. Key laws, regulations, and guidance that we identified included the Cooperative and Community Benefit Societies Act 2014, the Statement of Recommended Practice for registered housing providers: Housing SORP 2018, the Housing and Regeneration Act 2008, the Accounting Direction for Private Registered Providers of Social Housing 2019, tax legislation, health and safety legislation, and employment legislation.
This report is made solely to the Association, in accordance with section 87 of the Co-operative and Community Benefit Societies Act 2014. Our audit work has been undertaken so that we might state to the Association those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Association for our audit work, for this report, or for the opinions we have formed.
• We enquired of the Board and reviewed correspondence and Board meeting minutes for evidence of non-compliance with relevant laws and regulations. We also reviewed controls the Board have in place, where necessary, to ensure compliance.
Beever and Struthers, Statutory Auditor St George’s House, 215/219 Chester Road, Manchester, M15 4JE Date: DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2 16-Aug-22
• In addressing the risk of fraud due to management override of internal controls we tested the appropriateness of journal entries and assessed whether the judgements made in making accounting estimates were indicative of a potential bias.
Independent Auditors’ Report to the Members
In identifying and addressing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
• We enquired of the Board about actual and potential litigation and claims.
Due to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing fraud or non-compliance with laws and regulations and cannot be expected to detect all fraud and non-compliance with laws and regulations.
• We performed analytical procedures to identify any unusual or unexpected relationships that might indicate risks of material misstatement due to fraud.
Nicola Ebdon Chair Board Member Company Secretary
Interest and financing costs 7 (7,073) (7,073) (24,255) (24,255)
Surplus/(deficit) before tax 8 6,503 6,485 (7,793) (7,902) 9
Cost of sales 2 (587) (587) (1,303) (1,303)
The financial statements on pages 51 to 100 were approved and authorised for issue by the Board on 26 July 2022 and were signed on its behalf by:
Increase in valuation of Investment Properties 13a 100
Year Ended 31 March 2022 Ended 31 March 2021
Operating surplus 13,493 13,468 16,207 16,185
Interest receivable 83 90 155 162
- -
Surplus/(deficit) for the year after tax 6,503 6,485 (7,793) (7,902)
LHP Financial Statements | 31 March 202251
Statement of Compliance
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Gift Aid 6
Turnover 2 54,910 54,885 54,690 54,667
Year
Operating expenditure 2 (41,791) (41,791) (38,556) (38,555)
Simon Parkes
The consolidated and parent results relate wholly to continuing activities and the notes on pages 56 to 100 form an integral part of these accounts.
Actuarial gain/(loss) in respect of pension schemes 12 9,138 9,138 (5,843) (5,843)
Taxation
Note Group Association Group Association £’000 £’000 £’000 £’000
Gain on disposal of property, plant, and equipment 6 961 961 1,376 1,376
Statement Comprehensiveof Income
Total comprehensive Income/(Deficit) for the year 15,641 15,623 (13,636) (13,745)
Anthony Read
The consolidated and parent results relate wholly to continuing activities and the notes on pages 56 to 100 form an integral part of these accounts. DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Anthony Read Simon Parkes Nicola Ebdon Chair Board Member Company Secretary
LHP Financial Statements | 31 March 202252 Statement of Financial Position Year Ended 31 March 2022 Year Ended 31 March 2021 Note Group Association Group Association £’000 £’000 £’000 £’000 Fixed assets Tangible fixed assets – Property 13a 317,391 316,904 302,706 302,219 Tangible fixed assets – Other 13b 2,920 2,920 2,708 2,708 Investment in subsidiaries 14 13 13 320,311 319,837 305,414 304,940 Current assets Properties in the course of sale 16 507 507 387 387 Stock 15 113 113 122 122 Trade and other debtors 17 2,178 2,544 1,818 2,122 Cash and cash equivalents 18 19,352 19,182 41,795 41,660 Less: Creditors: Amounts falling due within one year 19a (9,020) (9,010) (8,449) (8,394) Net current assets 13,130 13,336 35,673 35,897 Total assets less current liabilities 333,441 332,173 341,087 340,837 Creditors: amounts falling due after more than one year 19b&c (214,657) (214,657) (229,058) (229,058) Provisions for liabilities Pension provision 12 (495) (495) (9,381) (9,381) Total net assets 118,289 118,021 102,648 102,398 Reserves Non-equity share capital 23 Income and expenditure reserve 74,256 73,988 57,986 57,736 Revaluation reserve 44,033 44,033 44,662 44,662 Restricted reserves Total reserves 118,289 118,021 102,648 102,398
Statement of
Compliance The financial statements on pages 51 to 100 were approved and authorised for issue by the Board on 26 July 2022 and were signed on its behalf by:
Transfer from revaluation reserve to income and expenditure reserves 240 (240)
71,382 4 44,902 116,288
The
Pension revaluation from Statement of Comprehensive Income (5,843) (5,843)
LHP Financial Statements | 31 March 202253
Balance as at 31 March 2020
Balance as at 31 March 2021 57,986 44,662 102,648
100
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Transfer from revaluation reserve to income and expenditure reserves 629 (629)
Consolidated Statement of Changes in Reserves
Pension revaluation from Statement of Comprehensive Income 9,138 9,138
Surplus from Statement of Comprehensive Income 6,503 6,503
Balance as at 31 March 2022 74,256 44,033 118,289 notes on pages 56 to form integral part of these accounts.
Income expenditureandreserve Restrictedreserves Revaluation Total Reserves £’000 £’000 £’000 £’000
Surplus from Statement of Comprehensive Income (7,793) (4) (7,797)
an
Proceeds from sale of tangible fixed assets 1,483 2,343 83 155 (23,381) (16,564)
Interest paid and similar charges (7,073) (24,255)
Year Ended 31 March 2022 Year Ended 31 March 2021 £’000
New secured loans 49,412 119,896
Loan issue costs (199) (206)
LHP Financial Statements | 31 March 202254
Cash and cash equivalents at the beginning of the year 41,795 11,780
Consolidated Statement of Changes of Cash Flows
Net cash generated from operating activities 21,470 22,644
Purchase of tangible fixed assets (24,947) (19,062)
Cash and cash equivalents at the end of the year 19,352 41,795
Net change in cash and cash equivalents (22,443) 30,015
Cash flow from investing activities
Repayment of borrowings (62,672) (71,500) (20,532) 23,935
Grants Interestreceivedreceived
Cash flow from financing activities
£’000
The consolidated and parent results relate wholly to continuing activities and the notes on pages 56 to 100 form an integral part of these accounts.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Surplus/(deficit) for the year 15,641 (13,636)
(Decrease) in trade and other creditors (697) (1,868)
Revaluation of Investment Properties (100)
Year Ended 31 March 2022 Year Ended 31 March 2021 £’000 £’000
Adjustments for non-cash items:
Decrease/(increase) in stock 9 (3)
Depreciation of tangible fixed assets 9,531 8,746
(Decrease)/ increase in provisions (8,886) 5,632
Government grants utilised in the year (794) (790) payable 6,965 24,212 received (83) (155)
Amortisation of loan issue costs 108 43
Decrease/(increase) in properties in the course of sale (120) 514
Proceeds from the sale of tangible fixed assets (1,483) (2,343)
Cash flow from investing activities
LHP Financial Statements | 31 March 202255
Consolidated Statement of Cash Flows
(Increase) / decrease in trade and other debtors (359) 612
Interest
Net cash generated from operating activities 21,470 22,644
Interest
The consolidated and parent results relate wholly to continuing activities and the notes on pages 56 to 100 form an integral part of these accounts.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Carrying amount of tangible fixed asset disposals 1,638 1,780
Adjustments for investing or financing activities:
Notes to the Financial LegalStatementsStatus
Non-registered
office is Westgate Park, Charlton Street, Grimsby, North Lincolnshire DN31 1SQ. Lincolnshire Housing Partnership’s principal activity is to provide social Thehousing.Group
Name Incorporation
Non-registered
The principal accounting policies are summarised below. They have been applied consistently throughout the year.
The Group’s financial statements have been prepared in accordance with applicable United Kingdom Accounting Generally Accepted Accounting Practice (UK GAAP) and the Statement of Recommended Practice for registered housing providers: Housing SORP 2018. The Group is required under the Cooperative and Community Benefit Societies (Group Accounts) Regulations 1969 to prepare consolidated Group financial statements.
The financial statements comply with the Cooperative and Communities Benefit Societies Act 2014, the Co-operative and Community Benefit Societies (Group Accounts) Regulations 1969, the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2022. The financial statements are prepared on the historical cost basis of accounting (including deemed cost upon adoption of FRS102), modified to include certain items at fair value, and are presented in sterling £’000 for the year ended 31 March 2022.
In preparing the separate financial statements of the parent company, advantage has been taken of the following disclosure exemptions available in FRS102:
Co-operative
The Group’s financial statements have been prepared in compliance with FRS102. In complying with FRS102 the Group and Association meets the definition of a Public Benefit Entity.
Parent company disclosure exemptions
• No disclosure has been given for the aggregate remuneration of the key management personnel of the parent company as their remuneration is included in the totals for the group as a whole.
Humber Homes Limited Companies Act 2006
Non-registered
• No cash flow statement has been presented for the parent company,
• Disclosures in respect of the parent company’s financial instruments have not been presented as equivalent disclosures have been provided in respect of the group as a whole.
Registered
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Boston Mayflower Finance plc Companies Act 2006
The Group Company (Lincolnshire Housing Partnership) is a registered society in England under the Co-operative and Community Benefit Societies Act 2014. It has exempt charitable status and is registered with the Regulator of Social Housing as a Registered Provider (RP) of social housing. Registered
Principal Accounting Policies
comprises the following entities:
Speedwell Homes Limited Companies Act 2006
Lincolnshire Housing Partnership and Community Benefit Societies Act 2014
LHP Financial Statements | 31 March 202256
Registered / Non-registered
Lincolnshire Housing Partnership has considerable resources and, therefore, the Board believes the Group is well placed to manage its business risks successfully despite current uncertainties in the social housing sector and the current pandemic. The Board has a reasonable expectation that the Group has adequate resources to continue operations for the foreseeable future. For this reason, they continue to adopt the going concern basis in the preparation of these financial statements.
Judgements and key sources of estimation uncertainty
Going Concern
and considers if changes have occurred that result in Categorisationimpairment. of housing properties. The Group has undertaken a detailed review of the intended use of all housing properties. In determining the intended use, the Group has considered if the asset is held for social benefit or to earn commercial rentals. The Group has determined that market rented properties are investment properties. The Group has identified a cash generating unit for impairment assessment purposes at a property scheme level.
Reviews for impairment of housing properties are carried out when a trigger has occurred and any impairment loss in a cash generating unit is recognised by a charge to the Statement of Comprehensive Income. Impairment is recognised where the carrying value of a cash generating unit exceeds the higher of its net realisable value or its value in use. A cash generating unit is normally a group of properties at scheme level whose cash income can be separately identified.
The Group perform impairment tests based on fair value less costs to sell or a value in use calculation. The fair value less costs to sell calculation is based on available data from sales transactions in an arm’s length transaction on similar cash generating units (properties) or observable market prices less incremental costs for disposing of the properties. The value in use calculation is based on either a depreciated replacement cost or a discounted cash flow model. The depreciated replacement cost is based on available data of the cost of constructing or acquiring replacement properties to provide the same level of service potential to the Association as the existing property. The cash flows are derived from the business plan for the next 30 years. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as the expected future cash flows and the growth rate used for extrapolation purposes.
The Group financial statements consolidate the financial statements of Lincolnshire Housing Partnership and its subsidiary undertakings up to 31st March 2022.
Notes to the Financial BasisStatementsofconsolidation
Impairment
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Development expenditure
The Group capitalises development expenditure in accordance with the accounting policy. Initial capitalisation of costs is based on management’s judgement once development scheme is confirmed; this is usually when Board approval has taken place including when access to the appropriate funding is secured. In determining whether a project is likely to cease, management monitors the development
LHP Financial Statements | 31 March 202257
Notes to the Financial PensionStatementsandotherpost-employmentbenefits
Bad debt provision
Completed housing properties at FRS 102 transition date are stated at deemed cost at the transition date and subsequently at cost and all other tangible fixed assets are held at historic cost. Both are depreciated over their useful lives considering residual values, where appropriate. For housing property assets, the assets are broken down into components based on management’s assessment of the properties. The actual lives of the assets and residual values are assessed annually and may vary depending on several factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are considered. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Turnover represents rental income receivable, amortised capital grant, revenue grants from local authorities and Homes England, income from the sale of shared ownership and other properties developed for outright sale and other income and are recognised in relation to the period when the goods or services have been supplied.
The cost of defined benefit pension plans and other post-employment benefits are determined using actuarial valuations. Due to the complexity of the valuation, the underlying assumptions and the long-term nature of these plans, such estimates are subject to significant uncertainty. In determining the appropriate discount rate, management considers the interest rates of corporate bonds in the respective currency with at least AA rating, with extrapolated maturities corresponding to the expected duration of the defined benefit obligation. The underlying bonds are further reviewed for quality, and those having excessive credit spreads are removed from
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
recoverability of balances outstanding at the yearend. A review is performed on an individual debtor basis to consider whether each debt is recoverable.
Turnover and revenue recognition
For rental and trade debtors
LHP Financial Statements | 31 March 202258
LHP make a provision for rental arrears, which are considered to be non-recoverable. The full value of former tenant debt is provided for. The provision for current tenant debt is calculated based upon the value of the debt.
Other key sources of estimation and Tangibleassumptionsfixedassets
The estimate for receivables relates to the
Rental income is recognised when the property is available for let, net of voids. Income from property sales is recognised on legal completion. Supporting People income is recognised under the contractual arrangements.
the population bonds on which they are based, on the basis that they do not represent high quality bonds. The mortality rate is based on publicly available mortality tables for the specific sector. Future salary increases and pension increases are based on expected future inflation rates for the respective sector. Further details are given in note 12.
LHP Financial Statements | 31 March 202259
The current income tax charge is calculated based on tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Group operates and generate taxable income.
Lincolnshire Housing Partnership has charitable status and is not subject to Corporation Tax.
For the subsidiary companies the tax expense for the period comprises current and deferred tax. Tax is recognised in profit and loss, except that a change attributable to an item of income or expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
included in the rent are included in the Statement of Comprehensive Income from social housing lettings note 3 and matched against the relevant costs.
Position at the amount of the net proceeds after issue, plus increases to account for any subsequent amounts amortised. Where loans are redeemed during the year, any redemption penalty and any connected loan finance issue costs are recognised in the Statement of Comprehensive Income account in the year in which the redemption took place.
Notes to the Financial SupportStatementsincomeand costs including Supporting People
These are amortised over the life of the related loan. Loans are stated in the Statement of Financial
Value Added Tax (VAT)
Supporting People (SP) contract income received from Administering Authorities is accounted for as SP income in the Turnover as per note 2. The related support costs are matched against this income in the same
The Group charges VAT on some of its income and can recover part of the VAT it incurs on expenditure. All amounts disclosed in the accounts are inclusive of VAT to the extent that it is suffered by the Group and not recoverable.
Service charge income and costs are recognised on an accrual’s basis. The Group operates fixed service charges on a scheme-by-scheme basis in full consultation with residents. Where periodic expenditure is required, a provision may be built up over the years, in consultation with the residents; until these costs are incurred this liability is held in the Statement of Financial Position within long-term creditors.
Taxation
Supportnote.charges
Loan interest costs are calculated using the effective interest method of the difference between the loan amount at initial recognition and amount of maturity of the related loan.
Income and costs
Loan interest costs
Loan finance issue costs
Service charges
Expenditure relating to subsequent replacement or renewal of components is capitalised as incurred.
Lifts – 35-40 Years
Bathroom – 25-30 Years
Vehicles – 3 Years
Windows and Doors – 30 Years
Shared ownership properties
under construction are stated at cost and are not depreciated. These are reclassified as housing properties on practical completion of Freeholdconstruction.land is not depreciated.
Kitchen – 20 Years
Garages-30 Years
lease term is shorter than the longest component life envisaged; in which case the unexpired term of the lease is adopted as the useful economic life of the relevant component category.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
TangibleStatementsfixedassetsanddepreciation
UELs for identified components are as follows:
Wiring / Electrical – 30 Years
Fixtures and fittings – 10 Years
The costs of shared ownership properties are split between current and fixed assets based on the first tranche portion. The first tranche portion is accounted for as a current asset and the sale proceeds shown in turnover. The remaining element of the shared ownership property is accounted for as a fixed asset and subsequent sales treated as sales of fixed assets.
Housing properties are stated at either historical cost or deemed cost at transition date to FRS102 on 1 April 2014 and at cost thereafter, less accumulated Housingdepreciation.properties
Depreciation is charged on other tangible fixed assets on a straight- line basis over the expected economic useful lives which are as follows:
Where a housing property comprises two or more major components with substantially different useful economic lives (UELs), each component is accounted for separately and depreciated over its individual UEL.
Office Buildings – 100 Years
Operating leases
Structure – 80-120 Years
Payments are charged to the Statement of Comprehensive Income on a straight-line basis over the term of the lease.
MotorYears
Notes to the Financial
Roofs – 60-70 Years
Facias, guttering and soil pipes – 30 Years
Investment property includes market rented properties not held for the social benefit of the Group.
The Group depreciates freehold housing properties by component on a straight-line basis over the estimated UELs of the component categories.
There are three market rented properties within the Group. These are not designated as investment properties as the number of properties is immaterial to the Group.
Other equipment – 10 Years
Computer equipment & software – 3 Years
Improvements/Refurbishing Leasehold Premises – 5
LHP Financial Statements | 31 March 202260
Investment property
Central Heating / Boiler – 15-30 Years
The Group depreciates housing properties held on long term leases in the same manner as freehold properties, except where the unexpired
Holiday pay accrual
WhereTurnover.there
Revaluation Reserve
is a government grant associated with housing properties as part of a stock transaction, the fair value of the obligation to repay or recycle the government grant is reflected in the fair value of the housing properties and therefore no additional value is attributed to the government grant transferred.
Where developments have been financed wholly or partly by social housing and other grants, the amount of the grant received has been accounted for in accordance with the performance model adopted at Posttransition.transition, where developments have been financed wholly or partly by social housing and other grants, the amount of the grant received has been included as deferred income and recognised in Turnover over the estimated useful life of the associated asset structure (not land), under the accruals model. Social Housing Grant (SHG) received
Notes to the Financial ValuationStatementsofinvestments
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202261
Social Housing and other government grants
The Association holds £50K shares with £37.5k unpaid in its subsidiary, Boston Mayflower Finance plc at cost less impairment. There are no other investments.
Properties developed for shared ownership are included in current assets as they are intended to be sold at the lower of cost or estimated selling price less costs to complete and sell.
Stock and properties held for sale
At each reporting date, stock and properties held for sale are assessed for impairment. If there is evidence of impairment, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in Statement of Comprehensive Income.
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the income statement in other operating expenses.
for items of cost written off in the Statement of Comprehensive Income Account is included as part of
SHG must be recycled by the Group under certain conditions, if a property is sold, or if another relevant event takes place. In these cases, the SHG can be used for projects approved by the Homes England. SHG may however have to be repaid if certain conditions are not met. If grant is not required to be recycled or repaid, any unamortised grant is recognised as Turnover. In certain circumstances, SHG may be repayable, and, in that event, is a subordinated unsecured repayable debt.
Where Social Housing Grant is recycled, as described above, the SHG is credited to a fund which appears as a creditor until used to fund the acquisition of new properties, where recycled grant is known to be repayable it is shown as a creditor within one year.
A liability is recognised to the extent of any unused holiday pay entitlement which has accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date.
The revaluation reserve represents the difference on transition between the fair value of social housing properties and other assets and the historical cost carrying value, where deemed cost transitional relief was taken.
Recycling of capital grant
Stock of materials are stated at the lower of cost and net realisable value being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
Short-term debtors and creditors
LHP Financial Statements | 31 March 202262
Financial liabilities such as bonds and loans are held at amortised cost using the effective interest method,
At the end of each reporting period, financial instruments are measured as follows, without any deduction for transaction costs the entity may incur on sale or other disposal:
Commitments to receive or make a loan to another entity which meet the conditions above are held at cost less impairment,
Loans
Financial assets and financial liabilities are measured at transaction price initially plus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.
Notes to the Financial FinancialStatementsinstruments
Financialdebt.assets
All loans held by the Group are classified as basic financial instruments in accordance with FRS 102. They are measured at transaction price plus transaction costs initially, and subsequently at amortised cost using the effective interest rate method. Loans repayable within one year are not discounted.
Financial assets and financial liabilities are measured at transaction price initially, plus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.
Commitments to receive or make a loan to another entity which meet the conditions in para 11.8(c) of FRS 102 are measured at cost less impairment.
At the end of each reporting period, financial instruments are measured as follows, without any deduction for transaction costs the entity may incur on sale or other disposal. Debt instruments that meet the conditions in paragraph 11.8(b) of FRS 102 are measured at amortised cost using the effective interest method, except where the arrangement constitutes a financing transaction. In this case the debt instrument is measured at the present value of the future payments discounted at a market rate of interest for a similar debt.
Financial instruments held by the Group are classified as follows
Debt instruments that meet the conditions in paragraph 11.8(b) of FRS 102 are measured at amortised cost using the effective interest method, except where the arrangement constitutes a financing transaction. In this case the debt instrument is measured at the present value of the future payments discounted at a market rate of interest for a similar
such as cash, current asset investments and receivables are classified as loans and receivables and held at amortised cost using the effective interest method,
An investment in another entity’s equity instruments other than non- convertible preference shares and non-puttable ordinary and preference shares are held at cost less impairment.
Loans to or from subsidiaries including those that are due on demand are held at amortised cost using the effective interest method,
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202263
Notes to the Financial ImpairmentStatementsoffinancialassets
General Needs & Supported Housing incorporates all our social rented housing provision, including both social rent and affordable rent properties. Income is derived primarily from rent and service charges. Low-Cost Home Ownership comprises those properties where we have sold a proportion of the equity share to the occupier whilst retaining the remaining equity and the freehold of the property. Income is derived from service charges in respect of the properties and from rent charged on the unsold equity element of the properties.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
An impairment loss is measured as follows on the following instruments measured at cost or amortised cost:
As Boston Mayflower Finance plc holds debt, which is Publicly traded, the parent body, Lincolnshire Housing Partnership, is required to disclose consolidated information about its operating segments in accordance with IFRS 8. The Chief Operating Decision Maker (CODM) has been identified as the Group Executive Directors.
ii. For an instrument measured at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that the entity would receive for the asset if it were to be sold at the reporting date.
The Group Executive Directors have identified the operating segments as General Needs & Supported Housing and Low-Cost Home Ownership, reflecting the way in which the organisation is operated and managed. The Group Executive Directors receive information regarding the financial and operational performance of these segments on a regular basis.
Analysis of the Statement of Comprehensive Income by segment is provided in notes 2 and 3 to these financial statements. Our management reporting structure does not require analysis of assets and liabilities by segment, and these are therefore not included in the analysis of segmental reporting.
The following financial instruments are assessed individually for impairment:
Othersignificant.financial instruments are assessed for impairment either individually or grouped based on similar credit risk characteristics.
b. Other financial assets that are individually
iii. If, in a subsequent period, the amount of an impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed either directly or by adjusting an allowance account. The reversal cannot result in a carrying amount (net of any allowance account) which exceeds what the carrying amount would have been had the impairment not previously been recognised. The amount of the reversal is recognised in profit or loss immediately.
Segmental Reporting
a. All equity instruments regardless of significance; and
Financial assets are assessed at each reporting date to determine whether there is any objective evidence that a financial asset or group of financial assets is impaired. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.
i. For an instrument measured at amortised cost, the impairment loss is the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate.
LHP Financial Statements | 31 March 202264 Notes to the Financial 2aNoteStatements2Turnover,costof sales, operating expenditure and operating surplus 2022 Group Turnover Cost of sales expenditureOperating Operatingsurplus £’000 £’000 £’000 £’000 Social housing lettings (note 3a) 53,129 (41,504) 11,625 Low cost home ownership sales 809 (587) 222 Telecare services to third parties 658 (287) 371 Other Income 314 314 Total 54,910 (587) (41,791) 12,532 2021 Group Turnover Cost of sales expenditureOperating Operatingsurplus £’000 £’000 £’000 £’000 Social housing lettings (note 3a) 52,134 (37,956) 14,178 Other social housing activities Low cost home ownership sales 1,672 (1,303) 369 Activities other than social housing (note 3c) Telecare services to third parties 546 (526) 20 Other Income 338 (74) 264 Total 54,690 (1,303) (38,556) 14,831 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202265 Notes to the Financial 2b.StatementsTurnover,costof sales, operating expenditure and operating surplus 2022 Group Turnover Cost of sales expenditureOperating Operatingsurplus £’000 £’000 £’000 £’000 Social housing lettings (note 3b) 53,104 (41,504) 11,600 Low cost home ownership sales 809 (587) 222 Telecare services to third parties 658 (287) 371 Other Income 314 314 Total 54,885 (587) (41,791) 12,507 2021 Group Turnover Cost of sales expenditureOperating Operatingsurplus £’000 £’000 £’000 £’000 Social housing lettings (note 3b) 52,111 (37,955) 14,156 Other social housing activities Low cost home ownership sales 1,672 (1,303) 369 Activities other than social housing (note 3c) Telecare services to third parties 546 (526) 18 Other Income 338 (74) 264 Total 54,667 (1,303) (38,555) 14,809 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202266 Notes to the Financial 3aStatementsTurnover,operating expenditure and operating surplus Group HousingRented Low OwnershipHomeCost Other Total 20220 Total 2021 £’000 £’000 £’000 £’000 £’000 Income Rent receivable net of identifiable service charge 48,519 1,012 394 49,925 48,616 Service charge income 1,987 91 246 2,324 2,490 Amortised government grants 759 759 756 Other Income from Social Housing Lettings 101 20 121 272 Turnover from Social Housing Lettings 51,366 1,103 660 53,129 52,134 Operating expenditure Management 18,866 18,866 16,730 Service charge costs 2,901 153 3,054 2,917 Routine maintenance 8,962 8,962 7,406 Planned maintenance 604 604 1,357 Major repairs expenditure 360 Bad debts 481 6 487 459 Depreciation of Housing Properties 9,244 287 9,531 8,673 Demolition costs 54 Operating expenditure on Social Housing Lettings 41,058 287 159 41,504 37,956 Operating Surplus on Social Housing Lettings 10,308 816 501 11,625 14,178 Void losses (being rental income lost as a result of a property not being let, although it is available for letting) 606 259 865 1,407 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202267 Notes to the Financial 3bStatementsTurnover,operating expenditure and operating surplus Association HousingRented Low OwnershipHomeCost Other Total2022 Total2021 £’000 £’000 £’000 £’000 £’000 Income Rent receivable net of identifiable service charge 48,494 1,012 394 49,900 48,593 Service charge income 1,987 91 246 2,324 2,490 Amortised government grants 759 759 756 Other Income from Social Housing Lettings 101 20 121 272 Turnover from Social Housing Lettings 51,341 1,103 660 53,104 52,111 Operating expenditure Management 18,866 18,866 16,729 Service charge costs 2,901 153 3,054 2,917 Routine maintenance 8,962 8,962 7,406 Planned maintenance 604 604 1,357 Major repairs expenditure 360 Bad debts 481 6 487 459 Depreciation of Housing Properties 9,244 287 9,531 8,673 Demolition costs 54 Operating expenditure on Social Housing Lettings 41,058 287 159 41,504 37,955 Operating on Social Housing Lettings 10,283 816 501 11,600 14,156 Void losses (being rental income lost as a result of a property not being let, although it is available for letting) 606 259 865 1,407 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
General
needs housing intermediate rent 68
Low-cost
home ownership 30 46 98 130 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202268 Notes to the Financial 4.StatementsAccommodation, owned, managed and in development 2021 2022 No. of Properties No. of Properties Owned Managed Owned Managed Social Housing Under development at the end of year:
General
General
needs housing social rent
needs housing affordable rent 84
LHP Financial Statements | 31 March 202269 Notes to the Financial 4.StatementsAccommodation, owned, managed and in development (continued) 2021 No. of Properties 2022 No. of Properties Owned Managed Additions Disposals Other ChangeTenure Owned Managed Under management at the end of the year: General needs housing 9,672 4 9 (24) (4) 1 9,658 Affordable Rent HousingGeneral 141 47 1 (4) 185 olderhousinghousingSupportedandforpeople 1,721 1 1,722 ownershiphomeLow-cost 311 21 (2) (1) 329 Extra housingcare 30 30 RentIntermediate 212 16 (10) 218 Total owned and managed 12,087 4 93 (26) (13) (3) 12,142 Non-Social Housing Under management at the end of the year: Market rented 3 2 4 9 PropertiesLeasehold 366 1 3 (4) (1) 365 369 1 3 (1) 3 374 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202270 Notes to the Financial 5.StatementsAccommodationmanaged by and leased to others 2022 No. of properties 2021 No. of properties General needs 10 12 Supported housing 58 58 Non-social housing 22 22 Total 90 92 Lincolnshire Housing Partnership owns property managed by or leased to other bodies. 6. Profit on disposal of property, plant, and equipment Group and Association Right to Buy/ Right to salesAcquire Outrightsales staircasingownershipSharedsales Total2022 Total2021 £’000 £’000 £’000 £’000 £’000 Proceeds of sales 1,231 58 194 1,483 2,343 Less: Costs of sales (409) (9) (104) (522) (967) Total 822 49 90 961 1,376 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202271 Notes to the Financial Statements 7. Interest and financing costs Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Defined benefit pension charge 194 84 194 84 On loans repayable within five years 259 441 259 441 On loans wholly or partly repayable in more than five years 6,103 5,053 6,103 5,053 Costs associated with financing 517 275 517 275 Loan breakage Costs 18,402 18,402 7,073 24,255 7,073 24,255 8. Surplus on ordinary activities 2022 2021 £’000 £’000 The operating surplus stated after charging / (crediting) Auditors’ remuneration (excluding VAT): Audit of the group financial statements 49 48 Audit of subsidiaries 1 1 Fees payable to the Association’s auditor and its associates for other services to the Group: Service charge certification 4 4 Other 2 2 Depreciation of housing properties 9,531 8,673 Depreciation of other fixed assets 675 398 Surplus on sale of other fixed assets (961) (1,376) 9. Taxation No taxation charge arises as the Association has been granted charitable status accepted by HMRC. DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
The aggregate emoluments paid to or receivable by non- executive Directors and former non-executive Directors 69 68
Jiggy Lloyd 5,167 5,000
Anthony Read 15,000 15,000 Rob Jones Resigned 06/12/21 4,550 7,500 Robert Griffiths Resigned 15/09/20 3,750 Stephen Cousins Resigned 15/09/20 1,000
He is a member of the defined benefit pension scheme. The scheme was funded in line with the pension scheme guidelines for the Group, to which the Group contribute £43,063 for the year ended 31 March 2022 (2021: £39,585).
The aggregate emoluments paid to or receivable by executive Directors and former executive Directors 718 757
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
The aggregate amount of any consideration payable to or receivable by third parties for making available the services of a Director 33 112
LHP Financial Statements | 31 March 202272
Sally Marshall-Mills Appointed 02/02/21 5,167 833 Kate Lindley Appointed 02/02/21 5,986 833 68,850 68,416
Murray Macdonald is the Chief Executive of LHP and the highest paid director. His remuneration in relation to the period of account amounted to £145,307 (2021: £146,611).
Emoluments were made to the following members of the board £ £
10.StatementsDirectors’remuneration
2022 2021 £’000 £’000
Notes to the Financial
The aggregate amount of any consideration payable to Directors for loss of office 78
The emoluments paid to the highest paid Director excluding pension contributions 145 147
The aggregate emoluments paid to or receivable by Directors (key management personnel) 718 757
2022 2021 Name Appointed/ Resigned
Yvonne Lowe Resigned 30/09/21 3,750 7,500 Paul Casey 5,167 5,000 Carl Dewey 6,813 6,000 John Crowther 7,750 6,500 Simon Parkes 9,500 9,500
LHP Financial Statements | 31 March 202273 Notes to the Financial 11.StatementsEmployeeinformation 2022 2021 No. No. The average number of persons employed during the year expressed in full time equivalents was: Office staff 255 247 Wardens, caretakers, and cleaners 12 11 Operatives 104 105 371 363 Staff costs £’000 £’000 Wages and salaries 11,898 11,448 Social Security costs 1,134 1,077 Other pension costs 1,321 1,127 14,353 13,652 Aggregate number of full-time equivalent staff whose remuneration exceeded £60,000 in the period: No. No. £60,000 - £70,000 3 10 £70,000 - £80,000 6 4 £80,000 - £90,000 2 1 £90,000 - £100,000 2 £110,000 - £120,000 1 £130,000 - £140,000 3 3 £140,000 - £150,000 £170,000 - £180,000 1 £180,000 - £190,000 1 1 No loans have been made to employees in the year ended 31 March 2022 (2021 nill) DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
TheUK.
The Scheme is classified as a ‘last-man standing arrangement’. Therefore, the Group is potentially liable for other participating employers’ obligations if those employers are unable to meet their share of the scheme deficit following withdrawal from the Scheme. Participating employers are legally required to meet their share of the Scheme deficit
last completed triennial valuation of the scheme for funding purposes was carried out as at 30 September 2020. This valuation revealed a deficit of £1,560m. A Recovery Plan has been put in place with the aim of removing this deficit by 31 March 2028.
For financial years ending on or before 28 February 2019, it was not possible for the company to obtain sufficient information to enable it to account for the Scheme as a defined benefit scheme, therefore the company has accounted for the Scheme as a defined contribution scheme.
The liabilities are compared, at the relevant accounting date, with the Group’s fair share of the Scheme’s total assets to calculate the Group’s net deficit or surplus.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
newThe12.StatementsPensionObligationsSocialHousingPensionScheme(SHPS)(foremployees)
Notes to the Financial
on an annuity purchase basis on withdrawal from the Scheme.
The latest accounting valuation was carried out with an effective date of 30 September 2021. The liability figures from this valuation were rolled forward for accounting year-ends from the following 31 March 2022 to 28 February 2023 inclusive.
For financial years ending on or after 31 March 2019, it is possible to obtain sufficient information to enable the Group to account for the Scheme as a defined benefit scheme.
For accounting purposes, a valuation of the scheme was carried out with an effective date of 30 September each year. The liability figures from this valuation are rolled forward for accounting year-ends from the following 31 March to 28 February inclusive.
The Group participates in the Social Housing Pension Scheme (the Scheme), a multiemployer scheme which provides benefits to some 500 non-associated employers. The Scheme is a defined benefit scheme in the UK.
The Scheme is subject to the funding legislation outlined in the Pensions Act 2004 which came into force on 30 December 2005. This, together with documents issued by the Pensions Regulator and Technical Actuarial Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the
LHP Financial Statements | 31 March 202274
Discount rate for scheme liabilities
We have been notified by the Trustee of the Scheme that it has performed a review of the changes made to the Scheme’s benefits over the years and the result is that there is uncertainty surrounding some of these changes. The Trustee has been advised to seek clarification from the Court on these items. This process is ongoing, and the matter is unlikely to be resolved before the end of 2024 at the earliest. It is
Notes to the Financial Statements
recognised that this could potentially impact the value of Scheme liabilities, but until Court directions are received, it is not possible to calculate the impact of this issue, particularly on an individual employer basis, with any accuracy at this time. No adjustment has been made in these financial statements in respect of this potential issue.
following information provided by The Pension Trust (TPT) is based upon the full actuarial valuation of the fund as at September 2021 updated to 31 March 2022. 31 March 2022 31 March 2021 Rate of increase in salaries 4.12%
The 3.87% 3.87% 2.77% 2.22% 2.87%
LHP Financial Statements | 31 March 202275
Principal Actuarial Assumptions
Inflation assumption (CPI) 3.12%
Commutation of pensions to lump sums 75% 75% The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are: Current Pensioners Males 21.1 years Females 23.7 years Future Pensioners Males 22.4 years Females 25.2 years DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Rate of increase for pensions in payment / inflation 4.12%
(Deficit) in scheme at 31 March (1,562)
Expenses (13)
Amounts charged/credited to financing costs (80)
Movement in year: Employer service cost (net of employee contributions) (1,072)
Employer contributions 990 724 Past service cost Net interest/return on assets (80) (33) Remeasurements 2,173
of the amount charged to operating costs in the Statement of Comprehensive Income 31 March 2022 31 March 2021 £’000 £’000 Employer service cost (net of employee contributions) (1,046)
Analysis (526) (13) (539) (247) (33) (2,905) (1,494) (539) (2,231) (3,573)
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Analysis of pension finance income / (costs) Expected return on pension scheme assets 244 214 Interest on pension liabilities (324)
Notes to the Financial Statements
LHP Financial Statements | 31 March 202276
Amount of gains and losses recognised in the Statement of Comprehensive Income Actuarial gains/(losses) on pension scheme assets 1,413 674 Actuarial gains/(losses) on scheme liabilities 760
Total operating charge (1,059)
Actuarial gain/(loss) recognised 2,173 (2,231) Movement in surplus / (deficit) during the year (Deficit) in scheme at 1 April (3,573)
LHP Financial Statements | 31 March 202277
to the Financial Statements 31 March 2022 31 March 2021 Asset and Liability Reconciliation £’000 £’000 Reconciliation of Liabilities at start of period (14,026) (10,268) Service cost (1,072) (539) Interest cost (324) (247) Employee contributions (295) (218) Remeasurements 760 (2,905) Benefits paid 219 151 Past Service cost Curtailments and settlements Liabilities at end of period (14,738) (14,026) Reconciliation of Assets at start of period 10,453 8,774 Return on plan assets 244 214 Remeasurements 1,413 674 Employer contributions 990 724 Employee contributions 295 218 Benefits paid (219) (151) Assets at end of period 13,176 10,453 (Deficit) in scheme at 31 March (1,562) (3,573) DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Notes
LHP Financial Statements | 31 March 202278
The Lincolnshire County Council Pension - for TUPE employees formerly Boston Mayflower. The LGPS is a funded defined-benefit scheme, with the assets held in separate funds administered by the Lincolnshire County Council. The total contributions made for the year ended 31 March 2022 were £248k,
Notes to the Financial LocalStatementsGovernmentPension Scheme
of which employer’s contributions totalled £224k and employees’ contributions totalled £24k. The agreed contribution rates for future years are 29.7% for employers and range from 5.5% to 12.5% for employees, depending on salary.
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
(“LGPS”)
The following information is based upon a full actuarial valuation of the fund at 31 March 2019 updated to 31 March 2022 by a qualified independent actuary.
increase in salaries
Rate of 3.60% 3.15%
liabilities
The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are:
31 March 2022 31 March 2021 Current Pensioners Males 21.2 years 21.1 years Females 23.7 years 23.6 years Future Pensioners Males 22.1 years 22.0 years Females 25.1 years 25.0 years DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202279
increase for pensions in payment / inflation
Notes to the Financial PrincipalStatementsActuarialAssumptions
31
Inflation assumption (CPI) 3.30% 2.85%
Rate of 3.30% 2.85%
Discount rate for scheme 2.60% 2.0%
31 March 2022 March 2021
Commutation of pensions to lump sums 75% 75%
Past service cost
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Remeasurements 1,761 (541) (Deficit) in scheme at 31 March (1,991) (3,770)
Actuarial gains/(losses) on scheme liabilities (494) (460)
Notes to the Financial Statements
LHP Financial Statements | 31 March 202280
Employer service cost (net of employee contributions) (122) (100)
Actuarial gains/(losses) on pension scheme assets 288 277
Amounts charged/credited to financing costs (73) (73)
Net interest/return on assets (73) (73)
Total operating charge (122) (100)
Analysis of the amount charged to operating costs in the Statement of Comprehensive Income
Past service cost
Analysis of pension finance income / (costs)
Actuarial gain/(loss) recognised (206) (183)
Movement in surplus / (deficit) during the year (Deficit) in scheme at 1 April (3,770) (3,276)
Amount of gains and losses recognised in the Statement of Comprehensive Income
31 March 2022 31 March 2021 £’000 £’000
Employer contributions 224 230
Movement in year: Employer service cost (net of employee contributions) (133) (110)
Expected return on pension scheme assets 288 277
Interest on pension liabilities (361) (350)
The East Riding of Yorkshire Council Pension - for TUPE employees formerly Shoreline. The LGPS is a funded defined-benefit scheme, with the assets held in separate funds administered by the East Riding of Yorkshire Council. The total contributions made for the year ended 31 March 2022 were £391k of which employer’s contributions totalled £340k and employees’ contributions totalled £51k. The
Past Service cost
Asset and Liability Reconciliation £’000 £’000
Reconciliation of Liabilities at start of period (18,382) (15,419)
Remeasurements 502 (2,976)
Employer contributions 224 230 Employee contributions 24 25
agreed contribution rates for future years are 37.4% for employers and range from 5.5% to 12.5% for employees, depending on salary.
Notes to the Financial Statements
Return on plan assets 288 277
LHP Financial Statements | 31 March 202281
Reconciliation of Assets at start of period 14,612 12,143
31 March 2022 31 March 2021
Service cost (122) (100) Interest cost (361) (350) Employee contributions (24) (25)
Benefits paid (666) (488)
Assets at end of period 15,741 14,612 (Deficit) in scheme at 31 March (1,991) (3,770)
Curtailments and settlements
Benefits paid 655 488
Local Government Pension Scheme (“LGPS”)
Liabilities at end of period (17,732) (18,382)
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Remeasurements 1,259 2,425
Rate of increase for pensions in payment / inflation 3.20% 2.85%
LHP Financial Statements | 31 March 202282
The following information is based upon a full actuarial valuation of the fund at 31 March 2019 updated to 31 March 2022 by a qualified independent actuary.
Rate of increase in salaries 4.10% 3.75%
Discount rate for scheme liabilities 2.7% 2.0%
31 March 2022 31 March 2021 Current Pensioners Males 20.8 years 21.0 years Females 23.5 years 23.7 years Future Pensioners Males 22.0 years 21.2 years Females 25.3 years 25.5 years DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
31 March 2022 31 March 2021
Inflation assumption (CPI) 3.20% 2.85%
Notes to the Financial PrincipalStatementsActuarialAssumptions
Commutation of pensions to lump sums 75% 75%
The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are:
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Analysis of the amount charged to operating costs in the Statement of Comprehensive Income
Notes to the Financial Statements
31 March 2022 31 March 2021 £’000 £’000
Analysis of pension finance income / (costs)
Amount of gains and losses recognised in the Statement of Comprehensive Income
Movement in surplus / (deficit) during the year (Deficit)/ Surplus in scheme at 1 April (2,037) 1,021
Net interest/return on assets (41) 22
Employer service cost (net of employee contributions) (407) (305)
Actuarial gains on pension scheme assets 755 760
Actuarial (losses) on scheme liabilities (1,203) (1,043)
Total operating charge (407) (305)
Interest on pension liabilities (796) (738)
Employer contributions 340 341
Past service cost
LHP Financial Statements | 31 March 202283
Amounts charged/credited to financing costs (41) 22
Movement in year: Employer service cost (net of employee contributions) (407) (305)
Past service cost
Actuarial (loss) recognised (448) (283)
Remeasurements 5,204 (3,116) Surplus/(Deficit) in scheme at 31 March 3,059 (2,037)
Expected return on pension scheme assets 755 760
LHP Financial Statements | 31 March 202284
Assets at end of period 40,804 38,148
Interest cost (796) (738)
Liabilities at end of period (37,745) (40,185)
Employer contributions 340 341 Employee contributions 51 56
Service cost (407) (305)
31 March 2022 31 March 2021
Employee contributions (51) (56)
Remeasurements 2,552 (7,707)
Return on plan assets 755 760
Benefits paid (1,142) (1,063)
Reconciliation of Assets at start of period 38,148 33,463
Past Service cost
Surplus/(Deficit) in scheme at 31 March 3,059 (2037)
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Reconciliation of Liabilities at start of period (40,185) (32,442)
Asset and Liability Reconciliation £’000 £’000
Notes to the Financial Statements
Benefits paid 1,142 1,063
Remeasurements 2,652 4,591
Curtailments and settlements
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
impairment At
At
13a Tangible fixed assets Housing Properties Group CompletedforPropertiesHousingLetting LettingPropertiesHousingforUnderConstruction Low CompletedOwnershipHomeCostProperties Low ConstructionOwnershipHomeCostPropertiesUnder TotalPropertiesHousing £’000 £’000 £’000 £’000 £’000 Cost At
166
Disposals
362,205 3,094 22,203 1,050 388,552 Depreciation
propertiesexisting 15,067 15,067 Schemes
Financial
6,180
LHP Financial Statements | 31 March 202285
8,003 285
31-Mar-22 292,105 3,094 21,142 1,050
61,073 780 61,853 Charge
Change
*
Notes to the Statements start of the to completed (6,180) 2,184 (2,184) of Tenure (166) (1,683) (106) (1,789) the end of the year and start of the year for year 8,288 (698) (4) (702) the end of the year book value 317,391 19,511 302,706 During the year the Association undertook a detailed review of its fixed asset register which resulted in an adjustment to both cost and accumulated depreciation of the same value (£1.7m). The adjustment has no impact on the net book value of housing properties within the SOFP and therefore has not been treated as a prior year adjustment.
year 340,709 2,410 20,291 1,149 364,559 Additions propertiestoacquired 44 6,864 - 2,085 8,993 Works
1,149
31-Mar-21 279,636 2,410
70,100 1,061 71,161 Net
Reclassification * 1,722 1,722 Disposals
Reclassification * 1,722 1,722 At
Included
LHP Financial Statements | 31 March 202286
Notes to the Financial Statements
within the above note are 3 investment properties with a year-end balance of £490k (2021: £490k). These properties have been valued by Watsons Property using a qualified chartered surveyor in accordance with the RICS Valuation Appraisal Manual. The properties have been valued based on Open Market Value as at 23 November 2020. Housing Properties Comprise: 2022 2021 £’000 £’000 Freeholds 317,391 302,706 Long leaseholds Short leaseholds 317,391 302,706 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202287 Notes to the Financial Statements Association CompletedforPropertiesHousingLetting LettingPropertiesHousingforUnderConstruction Low CompletedOwnershipHomeCostProperties Low ConstructionOwnershipHomeCostPropertiesUnder TotalPropertiesHousing £’000 £’000 £’000 £’000 £’000 Cost At start of the year 340,222 2,410 20,291 1,149 364,072 Additions to properties acquired 44 6,864 - 2,085 8,993 Works to propertiesexisting 15,067 15,067 Schemes completed 6,180 (6,180) 2,184 (2,184) Change of Tenure 166 (166) Disposals (1,683) (106) (1,789) Reclassification * 1,722 1,722 At the end of the year 361,718 3,094 22,203 1,050 388,065 Depreciation and impairment At start of the year 61,073 780 61,853 Charge for year 8,003 285 8,288 Reclassification * 1,722 1,722 Disposals (698) (4) (702) At the end of the year 70,100 1,061 71,1612 Net book value 31-Mar-22 291,618 3,094 21,142 1,050 316,904 31-Mar-21 279,149 2,410 19,511 1,149 302,219 * During the year the Association undertook a detailed review of its fixed asset register which resulted in an adjustment to both cost and accumulated depreciation of the same value (£1.7m). The adjustment has no impact on the net book value of housing properties within the SOFP and therefore has not been treated as a prior year adjustment. Works to existing properties in the year: 2022 2021 £’000 £’000 Components capitalised 15,067 9,555 Amounts charged to expenditure 360 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202288 Notes to the Financial Statements 13b Tangible fixed assets – Other Group and Association Freehold Offices Computer and Office Equipment PlaygroundEquipment Total Non-Housing Assets £’000 £’000 £’000 £’000 Cost At start of the year 1,844 2,025 33 3,902 Additions 887 - 887 Disposals (2) (2) At the end of the year 1,844 2,910 33 4,787 Depreciation and impairment At start of the year 216 946 32 1,194 Charge for year 28 647 675 Disposals (2) (2) At the end of the year 244 1,591 32 1,867 Net book value 31-Mar-22 1,600 1,319 1 2,920 31-Mar-21 1,628 1,079 1 2,708 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202289 Notes to the Financial Group14.StatementsFixedassetinvestmentscompanies The Group comprises the following companies, all registered in England: Name Incorporationownershipand Regulated / Nonregulated Nature of business Lincolnshire Housing Partnership Company 100% Regulated AssociationHousing Humber Homes Limited Company 100% Non-regulated DevelopmentProperty Speedwell Homes Limited Company 100% Non-regulated Market Renting Boston Mayflower Finance plc Company 100% Non-regulated Financing Association Other subsidiaries Boston Mayflower Finance plc £’000 £’000 31 March 2021 13 31 March 2022 13 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202290 Notes to the Financial 15.StatementsStock Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Building Materials 93 75 93 75 Goods for sale or hire 20 47 20 47 113 122 113 122 16. Properties in the course of sale Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Properties held for sale Low cost home ownership properties: Completed 507 387 507 387 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202291 Notes to the Financial 17.StatementsTradeandotherdebtors Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Rent arrears 2,121 2,184 2,121 2,184 Less: provision for bad debts (1,090) (1,297) (1,090) (1,297) Amounts due from Group undertakings 366 330 Trade Debtors 89 113 89 113 VAT repayment due from HMRC 1 1 Other debtors 337 78 337 78 Prepayment and accrued income 721 739 721 712 Total 2,178 1,818 2,544 2,121 Debtors are all due within one year 18. Cash and cash equivalents Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Cash at bank and in hand 19,352 41,795 19,182 41,660 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202292 Notes to the Financial 19a.StatementsCreditors:amounts falling due within one year Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Trade creditors 536 565 536 565 Rents and service charges paid in advance 1,947 1,762 1,947 1,762 Amounts due to Group undertakings 285 285 VAT due to HMRC 14 443 14 443 Accruals and deferred income 4,651 3,894 4,651 3,609 Deferred Capital Grant (Note 20) 773 756 773 756 Recycled Capital Grant Fund (Note 21) 303 172 303 172 Other creditors 796 857 501 802 9,020 8,449 9,010 8,394 19b.Creditors: amounts falling due after more than one year Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 Loans (Note 19c) 196,637 209,896 196,637 209,231 Less: Loan arrangement fees (Note 19c) (1,095) (895) (1,095) (230) Deferred Capital Grant (Note 20) 18,995 19,829 18,995 19,829 Recycled Capital Grant Fund (Note 21) 120 228 120 228 214,657 229,058 214,657 229,058 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Less: loan issue costs (1,095) (895) (1,095) (230) 195,542 209,001 195,542 209,001
On 7 June 2021 Boston Mayflower Finance plc sold additional £35m from the retained capital market and lent the proceeds of this sale to Lincolnshire Housing Partnership Limited.
In five years or more 181,637 132,896 181,637 132,896
Loans repayable by instalments
In two years or more and less than five years
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Within one year
LHP Financial Statements | 31 March 202293
The amount payable in relation to the bond issue is an intercompany creditor for Lincolnshire Housing Partnership Limited with the amount owed to its subsidiary, Boston Mayflower Finance plc. Boston
In one year or more, but less than two years
Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000
In one year or more, but less than two years
In five years or more 15,000 15,000 15,000 14,335
Loans not repayable by instalments
On 8 September 2014 Lincolnshire Housing Partnership Limited borrowed £90m from the capital markets through its subsidiary Boston Mayflower Finance plc via a combination of a 45-year bond issue and a 15-year Private Placement. Loans are secured by floating charges on all the Association’s assets and fixed charges on individual properties.
Mayflower Finance plc recognises an equivalent intercompany debtor within its accounts and the third-party liability to repay the bond on 8 September 2059.
In two years or more and less than five years 62,000 62,000
Within one year
Notes to the Financial 19c.StatementsNetDebtAnalysis
LHP Financial Statements | 31 March 202294 Notes to the Financial 19c.StatementsNetDebtAnalysis (continued) The interest rate profile of the Association at 31 March 2022 was: Total Variable rate Fixed rate Weighted averageWeightedterm £’000 £’000 £’000 % Years Instalment loans 150,000 150,000 4.321 38 Non-instalment loans –Bond Premium 31,637 31,637 38 Non-instalment loans 15,000 15,000 4.077 8 Lloyds Revolving Credit 196,637 196,637 4.299 36 As at 31 March 2022 the Association has the following borrowing facilities: £’000 Undrawn committed facilities 91,200 Undrawn facilities 141,20050,000 19d. Analysis of Changes in Net Debt Group Notes At 1 2021April Cash Flows Non-cash Changes At 312022March £’000 £’000 £’000 £’000 Cash and Equivalents 41,795 (22,444) 19,351 Debt Due within one year Debt Due after more than one year 19c (209,896) 13,259 (196,637) Net Debt (168,101) (9,185) (177,286) DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
year 20,585 21,472 20,585 21,472
Notes
to the Financial 20.StatementsDeferredCapital Grant Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000
LHP Financial Statements | 31 March 202295
At the end of the year 19,768 20,585 19,768 20,585 due
At start of the
to be released < 1 year 773 756 773 756 Amount due to be released > 1 year 18,995 19,829 18,995 19,829 Total deferred capital grant 19,768 20,585 19,768 20,585 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Grant recycled in the year – RCGF
Grant received during the year
Amortisation (773) (756) (773) (756)
Released to income in the year (21) (34) (21) (34)
Amount
Released to RCGF (23) (97) (23) (97)
LHP Financial Statements | 31 March 202296 Notes to the Financial 21.StatementsRecycledCapital Grant Fund Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000 At start of the year 400 303 400 303 Inputs: Grant recycled 23 97 23 97 Recycling: New Build At the end of the year 423 400 423 400 Amount due to be released < 1 year 303 172 303 172 Amount due to be released > 1 year 120 228 120 228 423 400 423 400 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
The Association’s constitution is that of a Cooperative and Community Benefit Society, therefore there is no share capital.
Use / allocation of funds (114) (114)
At the end of the year
Lincolnshire Housing Partnership Limited retains a £12,500 investment in Boston Mayflower Finance plc and is the registered holder of 50,000 shares of £1 each, of which £12,500 has been paid.
LHP Financial Statements | 31 March 202297
Amount less than three years old
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
Amount three years or older where repayment may be required
22.StatementsDisposalProceeds
The Disposal Proceeds Fund has ended, and all monies have been spent in prior periods
Notes to the Financial Fund
Group Association 2022 2021 2022 2021 £’000 £’000 £’000 £’000
At start of the year 114 114
23. Non-equity share capital
Capital expenditure that has been authorised by the Board, but has not been contracted for 10,964 652
Total capital expenditure in the next 12 months 17,222 10,860
Proceeds from the sale of properties 3,204 1,601
Total capital expenditure in the next 12 months 17,222 10,860
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202298
Notes to the Financial
Committed loan facilities 5,000 -
24.StatementsCapitalcommitments 2022 2021 £’000 £’000
Existing cash balances 7,688 9,259
Capital expenditure that has been contracted for, but has not been provided for in the financial statements 6,258 10,208
The Association expects these commitments to be financed with:
Social Housing Grant 1,330 -
to the Financial 25.StatementsOperatingleases The future minimum lease payments which the Group is committed to make under leases are as follows: 2022 2021 £’000 £’000 Land and buildings Less than 1 year 516 516 1 to 2 years 129 516 Between 2 to 5 years - 129 5 years or more Others Less than 1 year 437 442 1 to 2 years 227 437 2 to 5 years 1 229 5 years or more 26. Contingent liability There were no contingent liabilities to third parties as at 31 March 2022. 27. Grant and financial assistance 2022 2021 £000 £000 The total accumulated government grant and financial assistance received or receivable at 31 March 40,973 40,973 Held as deferred grant (note 20) 19,768 20,585 Recognised as income in Statement of Comprehensive Income 12,298 11,504 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 202299
Notes
Intra-group interest charges
28.StatementsRelatedparties
Notes to the Financial
There have been no transactions with key management personnel and their close family, (including compensation paid)
Intra-group interest is charged by the Association to its subsidiaries at an agreed commercial rate.
Intra-group management fees
Management charges Interest Charges Interest Received Non-regulated entities 2022 2021 2022 2021 2022 2021 £’000 £’000 £’000 £’000 £’000 £’000 Boston Mayflower Finance plc 6,103 5,053 Speedwell Homes Limited 3 3 7 7 3 3 7 7
Intra-group management fees are receivable by the Association from subsidiaries to cover the running costs the Association incurs on behalf of managing its subsidiaries and providing services. The management fee is calculated by using varying methods of Inallocation.December
There have been no Directors’ loans during the reporting year (2021: £Nil).
also receives charges from subsidiaries. The quantum and basis of those charges are set out on the following page:
Lincolnshire Housing Partnership Limited is the Parent entity in the Group and ultimate controlling party. The Group has taken advantage of the exemption available under Section 33.1A FRS 102 not to disclose transactions with wholly owned subsidiary undertakings.
No tenancy agreements are held by Board members.
LHP Financial Statements | 31 March 2022100
Transactions with registered and non-registered elements of the business The Association provides management services, other services, and loans to its Thesubsidiaries.Association
Related party balances are not secured.
2021 Speedwell Homes Limited made a £15,747 gift aid payment to the Association in relation to the 2020/2021 financial year. (£5,930 was paid in December 2020 in relation to 2019/2020).
The Group entered the following related party transactions in the year ended 31 March 2022:
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 2022101 Notes ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 2022102 Notes ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
LHP Financial Statements | 31 March 2022103 DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
DocuSign Envelope ID: 92DC15E6-1623-4292-A6B1-F26216B0E1A2
