Annual Accounts 2020

ACCOUNTS

2019 – 2020

ANNUAL

CONTENTS 2

CHAIRMAN & CHIEF EXECUTIVE’S REVIEW

14 HOW WE HELP 16 OUR YEAR IN NUMBERS 18 BOARD OF TRUSTEES 20 SENIOR MANAGEMENT TEAM 22 TRUSTEES REPORT 24 OBJECTIVES & ACTIVITIES 26 ACHIEVEMENTS & PERFORMANCE 28 FINANCIAL REVIEW 32 STRUCTURE, GOVERNANCE & MANAGEMENT 42 STRATEGIC REPORT 46 INDEPENDENT AUDITORS REPORT 50 STATEMENT OF FINANCIAL ACTIVITIES 53 NOTES TO THE FINANCIAL STATEMENTS 72 LEGAL & ADMINISTRATIVE INFORMATION

RBLI’s first mass participation event with our partners Be Military Fit 2019/2020 ANNUAL ACCOUNTS

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CHAIRMAN AND CHIEF EXECUTIVE’S REVIEW

RBLI’s President Viscount De L’Isle meeting Her Majesty The Queen at the site of RBLI’s Centenary Village expansion

Our charity celebrates its milestone Centenary Year this year and is also mid-way through a 10-year strategy for growth. RBLI has, over its 100 years, evolved a unique mix of facilities and holistic services that are helping disadvantaged veterans build a second life.

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Constantly modernising our mix of services, we are now at the point in RBLI’s strategy where we are transitioning from some of our older properties and facilities in order to make way for new developments, both on the Centenary Village and across our care pathway.

In this report on our financial performance you will read how we have been expanding our Village this year. We cannot thank our donors enough for helping us move forward with our Centenary Village expansion and construction at pace. The support for our expansion plans has been immense. In our Centenary year we were honoured that Her Majesty The Queen came to visit and was able to formally open Appleton Lodge, our new Extra Care suites, which also offer new day care services. Appleton Lodge, named after the inspiring WWI nurse Edith Appleton, has filled an important gap in RBLI’s provision. The new facilities offer a level of care between Independent Living where veterans benefit from daily care with routine needs, and Gavin Astor House where veterans with complex health and nursing needs access 24-hour nursing care. With the new Appleton Lodge it means RBLI offers the full care pathway across our diverse Village,

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from fully independent living to end of life care, with every level of care in between.

This is a big milestone for the charity, and a big strategic achievement, one of very few centres in the UK where this kind of care and transition support is possible.

the expansion. This positive disruption has had a significant financial impact on RBLI’s income from rent and care places during this year.

With the full care pathway in place, and growing interest in RBLI’s holistic support This progress is putting the foundations model, newly appointed Minister for in place to make sure RBLI can be here Defence People and Veterans, Johnny for another 100 years, Mercer MP, also chose to helping our nation’s most launch the new Office for disadvantaged veterans Veterans’ Affairs at RBLI Her Majesty The turn their lives around in the autumn. As well as Queen spent completely. You will read nursing care, RBLI’s mix in this report about the of homes, welfare and over three hours fundraising success for employability services can with us at RBLI, our Centenary Village help veterans overcome meeting people expansion. This meant mental health challenges, and touring the that Her Majesty The homelessness and long-term village Queen, who was with us unemployment. Johnny for over three hours, was Mercer was able to shine also able to cut the turf a light on RBLI’s STEP IN for the next phase of construction works approach which has helped 22 veterans – more Assisted Living, more adapted move on, and away from our Village, to new apartments and family homes. The major opportunities during the year. developments across RBLI’s facilities have required some residents to move location on the Village while works are underway, and some properties to remain vacant, or even be demolished, to create space for

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CHAIRMAN AND CHIEF EXECUTIVE’S REVIEW CONTINUED

BBMC veterans showcase Morrisons new ‘Britain’s Bravest’ coasters product line

The Centenary year saw RBLI launch our have set up the social enterprise with new LifeWorks employability programme in income streams, and new employment Hull, and deliver outstanding support to opportunities, for more veterans for unemployed veterans in deprived areas decades to come. nationally, with targeted We were delighted that regional impact achieved during the charity’s with our funding partners Centenary year The First COVID-19 HIT across Wales, the North Minister of Scotland officially RIGHT AT THE East, and in Scotland. opened Scotland’s Bravest END OF OUR Importantly the range Manufacturing Co. our FINANCIAL YEAR, social enterprise in Glasgow. of commercial products developed and delivered We have continued to CAUSING SOME

by RBLI’s social enterprise win generous charitable UNEXPECTED factories also grew. support for the start-up CHALLENGES. We expanded our and we have been able operations in Britain’s to make investments in Bravest Manufacturing state of the art equipment.

Co. (BBMC) with our corporate partners We have grown the number of veteran Barratt Developments and Morrisons. beneficiaries in our Scottish enterprise BBMC, a leading signage manufacturer for and made important progress, with our road, rail, and large-scale infrastructure, partner charity Erskine, in replicating the is now able to provide branded hoardings integrated Village model. and a wider variety of signage for During the year RBLI’s social enterprises outdoor sales suites. During the year, were involved in ongoing influencing RBLI also acquired the There But Not campaigns to increase social value created There legacy and online Tommy shop, by national supply chains. With our valued bringing RBLI’s social enterprise towards customer Amey, RBLI were represented at business-to-consumer products and more the All Party Parliamentary Group on social online retail. All the new ranges were enterprise promoting Amey’s leadership operationally challenging to establish but in this space. Similarly with our customers 4

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Bear Scotland, SBMC has been helping to promote best practice in social value procurement. Charlie Wallace, the Scottish Veterans’ Commissioner described Scotland’s Bravest Manufacturing Co. as a “stand out example”.

Access to Work, which delivered an average 975 workplace assessments every month, and all RBLI’s face to face programmes offering employability support, all maximise our core capability and expertise in disability employment and frontline “back to work” services.

Our lottery funded, BBO programmes are impacting the most deprived communities in Sussex, Surrey and Kent, supporting people with educational barriers to employment, inter-generational unemployment, as well as disability, mental health barriers, and ongoing health conditions.

At the very end of the financial year 2019/20 the global coronavirus pandemic hit the UK. We have had to adapt, we have had to draw on our charity’s reserves, and in order to inform readers of the impact, we have included additional COVID-19 information within the Strategic Report on page 42.

RBLI’s strategic goals have not changed.

Our strategy remains growth in order to reach more beneficiaries with holistic support and our evidenced expertise.

Although a challenging year for operational finances, and a very significant year of operational change, this has been counterbalanced by significant successes in fundraising.

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Build a resilient work, health and training services business, “best in class” at working with people with disabilities, health conditions and those furthest from the workplace.

Continue developing and delivering first class preemployment support for the Armed Forces community, centred on sustainable and relevant variants of LifeWorks programmes across the whole of the UK.

Build a 21st century social enterprise and employment academy.

RBLI WELCOMES OUR NEW PRESIDENT Everyone at RBLI would like to thank Viscount De L’Isle CVO MBE, Lord Lieutenant of Kent, for his wonderful support for the charity as our President. As Viscount De L’Isle retires we have been reflecting on his service to us, and to the county of Kent, and his unstinting support for the military community, military families, and the cadets. His leadership in the field of volunteering, which also inspired RBLI to formalise our own volunteering programme in 2017, could not have come at a better time, putting us all in a much stronger position when the COVID-19 pandemic hit.

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We are pleased and proud to announce and welcome Lord King KG GBE, former Governor of the Bank of England and Life Peer as RBLI’s new President. Lord King has been involved in our charity since 2018 when he launched our Centenary Village expansion campaign at a special event at The Tower of London. Lord King is one of the world’s most respected and significant leaders in banking, and has generously used his influence to draw attention to RBLI’s work and ambitious Centenary Village project.

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Secure funding, sponsorship, awareness, and profile, to maximise the opportunities for our beneficiaries.

STRATEGIC GOALS

Further develop thriving communities for those veterans who are most in need from across the UK with integrated services of social care, health care, employment support and accommodation. Be the catalyst for replication of effective integration across the UK.

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LOOKING BACK ON THE FINANCIAL YEAR 2019/2020

Greenwich Hospital is supporting RBLI’s assisted living.

RBLI’s diverse Village is changing fast. We opened Appleton Lodge in August, which is generating new care income for the charity. Other developments in our estates management have led to a reduction in income. We demolished bungalows to clear the site for the first Centenary Village buildings and this resulted in reduced income for a longer period than projected.

We also moved residents out of Gavin Astor in preparation for a full dementia-friendly refurbishment of the home, but were unable to begin these works before COVID-19 hit.

However we have achieved full occupancy elsewhere across the Village.

David Thomas, Chief Executive at Barratt Developments during a day of volunteering

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The completion of the full care pathway, highlighted earlier, is very significant, and the success of individual transitions within the Village already in evidence. The impact of a huge investment in older care has opened up Day Care services, and enabled us to continue our outreach with isolated veterans in the wider community reaching 100 older veterans. The impact of our dementia training and culture change project has also been felt widely, this puts RBLI in a strong position to provide more older care, respite, and specialist dementia care, to meet a growing need.

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The financial support for RBLI’s Centenary Village expansion has been fantastic.

Greenwich Hospital is supporting the new Greenwich House Assisted Living.

Greenwich Hospital supports Royal Navy and Royal Marine veterans and values the mixed tri-service community of all ages on RBLI’s Village.

The Oak Foundation is a major force in global philanthropy determined to tackle the root causes of poverty and disadvantage. They were keen to support more single living apartments, STEP IN, and RBLI’s move on outcomes.

The Colyer Fergusson Charitable Trust are a major funder in Kent, investing in communities, and they were keen to support RBLI’s unique community in their own milestone 75th Anniversary Year.

Finally the Royal Engineers’ Association made a major commitment to build Sapper House recognising the social safety net RBLI offers to their members from all over the UK. The Centenary Village fundraising campaign has won fantastic support from General Sir Gordon Messenger, Lord King, Lord Abergavenny, Lord Colgrain, Earl Howe, and Sir Michael Fallon. A single dinner held

at the House of Lords in 2019 secured £1m towards the campaign. Her Majesty’s turf cutting ceremony and resulting press reach (international) securing another £1.5m after her visit. Construction on the next phase began immediately after Her Majesty’s Turf Cut. The project is on track to deliver 100 new homes and a Community Centre by 2024. With fundraised income paying for the build, once completed, the new Village (with its myriad of integrated services) will be sustainable through rent and care income. When finished, the charity will be able to increase the annual reach, and the positive social impact of Village, without any additional fundraising.

Other fundraising performance has also been positive for the long term. A former Trustee and long-term supporter of the charity Betty Underhill OBE left RBLI a legacy and during 2019 RBLI launched its first legacy campaign. Betty Underhill’s impact has gone on inspiring others, and her life is the focus of 2020 activity. RBLI has also grown other activities which generate unrestricted income, holding the first mass participation event with partners Be Military Fit. The fitness events in parks across UK generated £40k in new income and won new supporters UK wide.

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LOOKING BACK ON THE FINANCIAL YEAR 2019/2020

The Menin Gate cycle ride raised over Forces veterans individually, giving them £60k with almost 60 riders. The Barratt the chance to focus on consolidating their Development partnership ball, run by experience and skills, and make realistic Barratts’ graduates raised enough income plans. to deliver a new dementia garden. A new Scotland’s Bravest Manufacturing Co. centenary partnership with although only in its second Shepherd Neame brewery, full year of operation, was beginning with “pennies” able to attract customer OUR 150-MILE – customers rounding up partners who are leading CENTENARY CYCLE their purchases – very on Scottish infrastructure CHALLENGE quickly moved on to more projects, as well as large-scale RAISED OVER £60K employee-led activities. government signage orders.

FOR RBLI, WITH LifeWorks, RBLI’s outreach It is very encouraging that OVER 60 RIDERS and employment support the Scottish Government TAKING PART. for disadvantaged veterans has endorsed SBMC at the continued to attract highest level and leads by support from a wide range example on social value of funders who are determined to break purchasing. On top of this, the new factory cycles of disadvantage for the long term. has won significant seed support and Several funders supported RBLI to deliver donations from charitable funders who LifeWorks in the North, North East, and recognise that veterans who have been most deprived areas in Wales including out of work for decades, and veterans with the Veterans Foundation, Morrisons serious disabilities and health conditions, Foundation, The Swire Charitable trust, will need a lot longer to gain confidence and Greenwich Hospital. ABF The Soldiers’ and skills. The new start up benefited Charity continued to support Armed this year when The National Lottery

provided the funding of a new training room, dramatically increasing the scope for facilitated learning and group coaching sessions alongside the veterans’ hands-on manufacturing experience.

In our Employment Solutions Division, RBLI delivers large-scale programmes based on long-term investment from strategic funding partners in specific geographic areas and stakeholder groups. The DWP’s commitment in narrowing the disability employment gap, lottery funding and European funding made it possible for RBLI to reach well over 11,000 disadvantaged people.

This division has had excellent feedback and recognition from funders for both employment and satisfaction outcomes which are far above the national benchmarks, and for RBLI’s ability to deliver truly person-centred support and coaching, at high volumes.

Charlie Wallace, Scottish Veterans Commissioner and great advocate of SBMC, visited us earlier this year.

Caption to go here...........

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LOOKING AHEAD With the ‘hard miles’ very much behind us, this Centenary Year has been the pivot upon which RBLI turns and matches its modern services with modern infrastructure fit for the veterans of today and tomorrow. The Village is an exemplar for others to replicate. We aim to continue working with partners from across all sectors, in particular our sister charities in the Armed Forces sector working collaboratively under the collective umbrella of Cobseo.

We are also excited to continue building some wonderful relationships with our commercial partners and the philanthropic Trusts and Foundations, many of whom have gone above and beyond to support RBLI during the COVID-19 period.

We are now midway through a 10 year strategy and working with others we will refine our plans to best meet the evidenced needs of our beneficiary groups. Forever cost conscious, we have implemented a major restructure and efficiency plan to meet current and future needs, with a saving of £750,000 per annum.

RBLI will continue to be here for veterans and their dependants and families for the next 100 years.

We continue to support disadvantaged veterans of all ages, all three services, and especially those with multiple needs.

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We are putting in place the best facilities and services for the needs of the growing older population whilst at the same time ensuring that there is an exciting route back to independence for younger veterans who have challenges to overcome. Our multigenerational and dynamic community can now grow to support many more.

Our priority remains the exciting Centenary Village and raising the remaining £4m we need to complete the project. This will be the biggest enabler in our quest to provide the much needed support to our most vulnerable veterans and their families.

Stephen Kingsman DL CHAIRMAN

Steve Sherry CMG OBE CHIEF EXECUTIVE 13th October 2020

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HOW WE HELP RBLI LIVING RBLI offers a variety of housing types available all in one place. On top of this mix the Village has a Community Café, large Training Centre, and Community garden.

An integrated welfare programme called STEP IN co-ordinates excellent nursing and care, welfare benefits and welfare support with employment and meaningful activity. Through STEP IN we also engage additional specialist partners in dementia, substance abuse, mental health, and run extra programmes e.g. horticulture, peer support groups, breakfast clubs, and schools partnerships.

We partner with PTSD resolutions, West Kent Mind, West Kent CCG and Kenward Trust, to offer support with detox, depression, anxiety and psychosis, and to provide additional peer support.

As independence grows residents on RBLI’s Village can transition to different housing always facilitated with the same support groups in place and with a structured programme of progress reviews.

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EMPLOYABILITY SUPPORT In all our face to face employability services, including LifeWorks, our impact is delivered by starting with comprehensive individual assessments. We build on consolidated skills, experience and traits with further coaching, and careful goal setting work. We focus on concrete practical steps towards employment, and place a lot of emphasis on meaningful activity, including hobbies, volunteering and unpaid domestic and community work. Additionally we are expert at supporting beneficiaries with the management of their health conditions, with access to basic education of FE access, job hunting skills and interview practice for training placements or new careers.

With support from our funders this year RBLI was able to dramatically increase the reach and employability outcomes through more online engagement, new online resources and video coaching. For example with support from Annington and the Army Central Fund, we were able to reach over 400 military spouses and partners with employability support.

BRITAIN’S BRAVEST MANUFACTURING COMPANY

BBMC is able to provide entry level roles in fulfilment, as well as specialist trades, training and skills. Veterans can also gain work on large-scale commercial tenders and new product development. Delivering for commercial clients including Amey, Network Rail and Barratt Developments, gives genuinely marketable and transferable skills.

Our B2C opportunities are growing significantly as we have now taken on the ‘There But Not There’ Tommy shop.

SCOTLAND’S BRAVEST MANUFACTURING COMPANY

Scotland’s Bravest Manufacturing Company supports beneficiaries through an 18-month supported programme. This gives a very clear structure to the support, with milestones and regular reviews.

The progamme achieves marketable skills, and a complete transformation in work-readiness.

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OUR YEAR IN NUMBERS

13,783

£3,068,350

£434,000

100k

975

pledged to the development of the Centenary Village

spent on STEP IN - integrated welfare, mental health, and community services

People supported by RBLI in 2019/20

£8m

investment in elderly care, including dementia care

£586k

spent on Appleton Lodge construction

engagements on Facebook

people with disabilities supported per month through Access to Work

£1.15m

20,000

£10m

spent on Centenary Village construction

Tommies made and distributed by Britain’s Bravest Manufacturing Company

fundraising achieved for our Centenerary Village campaign

NADRA AHMED OBE DL

Nadra is a Deputy Lieutenant for Kent and is Chairman of the National Care Association.

In 2006, she gained an OBE for her work in social care over 30 years. She is also Vice President of Hi Kent and Vice President of the Kent Care Homes Association.

OUR BOARD OF TRUSTEES BLAIR GULLAND

STEPHEN KINGSMAN DL CHAIRMAN Stephen is a former Chairman of the Denne Construction Group, which specialises in delivering affordable housing, regeneration schemes and care facilities, much like those offered by RBLI. His extensive history in charitable service has seen him in the role of Chairman of Canterbury Further Education College, Chairman of Kent Training and Enterprise Council and as an RBLI trustee for four years preceding his election to Chair.

KATHRYN CEARNS OBE FCA FCCA

FRANK MARTIN DL VICE CHAIRMAN Frank is a Deputy Lieutenant for Kent and was formerly Chief Executive of Hornby Plc. He is currently Deputy Chairman of the Dover Harbour Board and Chairman of Governors/Pro Chancellor of Canterbury Christ Church University.

Kathryn is a chartered accountant and non-executive director, mainly in the public sector or for public interest entities. Among other appointments, she is on the board of Companies House, the UK Supreme Court and Highways England. She is also on the External Audit Committee of the IMF and a Trustee for the Royal Mencap Society.

SARAH MASON

BRIGADIER TONY KERR OBE

Tony rose to the ranks of Brigadier in the British Army. Now retired, he has spent many years as a trustee of RBLI. He is also currently President of The Royal British Legion Village Branch at Aylesford.

ALISTAIR WATSON

Alistair served in the Royal Navy, during which time he was appointed Equerry to HRH the Prince of Wales, and then worked in the City for a leading international law firm. In retirement he is a school governor of two schools in central London and a Pilotlighter.

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Blair is Chairman and Partner at Gulland Solicitors and has been a practicing solicitor for over 40 years. He is also a Trustee of many other charities including Benenden Almhouse Charities, the Michael Yoakley Charity and the Kent Community Foundation.

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Sarah is a member of the Royal Institution of Chartered Surveyors, working for an award winning private house builder, having been an Associate Director in private practice previously, acting as a development consultant to the public and private sectors.

She is a mentor to Cambridge University Land Economy Masters students and is the Head of House at Medway Yacht Club.

STEVE ROWBOTHAM

Steve has worked in the defence industry throughout his career spanning over 4 decades. He is currently Vice President Government Relations and Board Director of General Dynamics UK, where he had been employed as Chief Operating Officer for the preceding six years. He is a Trustee of Bovington Tank Museum where he chairs the Collection Committee, and is also a business mentor to military veterans for the charity Heropreneurs.

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SENIOR MANAGEMENT TEAM

STEVE SHERRY CMG OBE CHIEF EXECUTIVE Brigadier Steve Sherry has been Chief Executive of RBLI since April 2010. With a MBA and MSc in Strategic Studies as well as a wealth of experience in implementing change in many differing environments, including Pakistan and the Czech Republic, Steve is enjoying leading RBLI at a time of significant growth, innovation and modernisation.

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LISA FARMER DIRECTOR OF STRATEGIC DEVELOPMENT Lisa Farmer joined RBLI in October 2015 as Director of Strategic Development with over 20 years of experience in fundraising, marketing and business development. Lisa spent 8 years at Young Epilepsy as Fundraising Director before becoming Director of Development and has been involved in major commercial developments including Loughborough University’s £40m fundraising campaign and two capital fundraising campaigns at Young Epilepsy.

WILL CAMPBELL-WROE DIRECTOR OF CARE AND WELFARE

KATE BULL DIRECTOR OF BRITAIN’S BRAVEST MANUFACTURING COMPANY

Will Campbell-Wroe has 20 years’ experience in the housing and charity sectors specialising in designing, securing funding for, and delivering services that support people to be independent and actively contributing to their local community. Will, who holds Masters’ Degrees in both Social Research and Housing and Social Policy, has a strong track record in developing innovative services that are designed and delivered to an extremely high standard.

Kate Bull joined RBLI in May 2019 as Director of Britain’s Bravest Manufacturing Company. An experienced director, Kate holds a depth of commercial, financial, property and business improvement experience across both the private and notfor-profit sectors. Prior to her appointment, Kate held senior positions at the Royal Voluntary Service and Action on Hearing Loss, as well as co-founding the prolific community interest company The People’s Supermarket.

PHIL DEFRAINE DIRECTOR OF CORPORATE SERVICES

MICHELLE FERGUSON

Phil Defraine is a CIMA qualified accountant. Having originally worked as a trainee accountant at the Burton Group, Phil spent 20 years in a number of senior management roles including UBS, Warburgs, Deutsche Bank and LloydsTSB. Phil joined RBLI as Head of Business Services within the Employment Solutions Division in 2005. Phil was appointed Director of Finance and Company Secretary in July 2010.

Michelle has held senior management positions within the media industry, television press and magazines and was a director for Scottish Sports Futures Charity. Before joining RBLI in 2018, she was Managing Director of successful social enterprise St Andrew’s First Aid Training and Supplies Ltd., leading the team as they gained Highly Commended at the UK National Business Awards. Michelle was also a Guest Lecturer at the University of Glasgow Business School in 2017.

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DIRECTOR OF SCOTLAND’S BRAVEST MANUFACTURING COMPANY

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REPORT OF THE TRUSTEES For the year ended 31 March 2020 The trustees are pleased to present their annual directors’ report together with the consolidated financial statements of the Charity for the year ended 31 March 2020 which are also prepared to meet the requirements for a directors’ report and financial statements for Companies Act purposes. The Charity registration number is 210063.

The Charity is also a limited company registration number 00158479.

The financial statements comply with the Charities Act 2011, the Companies Act 2006, the Memorandum and Articles of Association, and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

British Army veteran Tim holds a There But Not There Tommy - the beginning of RBLI’s B2C ventures.

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OBJECTIVES & ACTIVITIES

The primary objectives of the Charity are to support people with disabilities, health conditions or other social disadvantage to develop independence through the following activities:

The Charity achieves its purpose and objectives via the following activities and services: Delivering an integrated and comprehensive suite of care, accommodation and employment services and facilities on the RBLI Village, Aylesford with a clear focus on supporting veterans and their families.

The provision of welfare, healthcare and housing mainly for members of the exService community.

The provision of employment and development opportunities through social enterprise and LifeWorks employment support outreach programmes.

Supporting unemployed, disabled, disadvantaged and other unemployed people to increase their independence, and participation, through meaningful employment.

Delivering supported employment for individuals with disabilities and health conditions from the Armed Forces and wider community through our manufacturing social enterprise, Britain’s Bravest Manufacturing Company.

Delivery of the Government funded Work Programme across a large part of Kent and Sussex. This programme is currently delivered by RBLI as a sub-contractor to G4S on behalf of the Department of Work and Pensions. The provision of disability assessment services via our Access to Work Programme is delivered for the Department of Work and Pensions.

The design, development and ongoing delivery of RBLI’s innovative vocational assessment and development activities for the serving and veteran service community.

This is delivered via our LifeWorks courses for veterans, spouses of serving personnel, and veterans in custody. In addition, RBLI delivers vocational assessments to wounded, injured and sick serving personnel as part of the Right Management Career Transition Partnership with the MOD. Creating innovative new projects, products and outreach services to meet our objectives, and meet the needs of our beneficiaries more effectively and efficiently.

The Board of Trustees review the Charity’s strategic goals, activities and performance throughout the year and have considered the Charity Commission’s guidance on public benefit and are confident that the broad range of services and support that the charity provides demonstrable public benefit to a very large number of beneficiaries.

This report highlights some of the core work and achievements of the charity during the year.

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ACHIEVEMENTS & PERFORMANCE

For the year ended 31 March 2020

On the Village, Appleton Lodge achieved CQC registration August in 2019 and was fully occupied by the end of September.

The 15 new care suites were opened

by Her Majesty The Queen in November and began delivering increased Day Care, and achieving positive transitions.

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Other RBLI housing on the Village was also fully occupied.

Mountbatten Pavilion our emergency home achieved excellent move on outcomes with 12 residents becoming selfsufficient, confident and motivated to move to more independent homes. The total reach of RBLI’s STEP IN programme is growing year on year. The STEP IN welfare and employability model that can change lives for good was recognised with the Large Charity of the Year Award going to RBLI in the Kent Charity Awards.

The Centenary Year achieved significant growth in the RBLI’s supporter database. At the end of the year a move towards more online fundraising began with a successful virtual Sleep Out at the end of March. This was a big success raising well over £10,000 and supported by senior staff, trustees, BBMC customers and Kent leaders.

RBLI’s LifeWorks programe achieved impact in new places including Hull, where we were asked to return as demand for the programme was so great. Impact was achieved across the North of England thanks to our supporters.

Towards RBLI’s Centenary Village fundraising a total of £3m was secured in gifts A LifeWorks event and pledges PEOPLE with referral partners, during the year.

SUPPORTED BY organised in January, The campaign RBLI’S showed increasing reached its £10m EMPLOYMENT demand. We also milestone in SOLUTIONS had a significantly January 2020. improved response The fundraising to our LifeWorks and marketing families programme during the division of RBLI also grew year by marketing the 12 months’ unrestricted income to record telephone coaching that we offer. levels, in a centenary year where Total reach to spouses and families more individuals, companies and increased by 20% through more groups decided to get involved remote coaching delivery and and support. The Be Military Fit online resources.

Partnership in September was a milestone for the charity as the first mass participation event.

11,699

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RBLI’s Employment Solutions Division continued to deliver effective support at scale reaching 11,699 individuals. Across our “Brighter Futures” and Change your Tomorrow” programmes, which are aimed at the very furthest from the labour market 20-30% of individuals are securing work or workplace training, an exceptionally strong result for this group.

BBMC was successful in securing M20 motorway work for the signs team and also had increased success in the pallet making and pallet recycling teams. The launch of BBMC coasters in Morrisons stores in September was a big milestone for BBMC, and the products were personally championed

by Morrisons Chief Executive, David Potts.

BBMC was encouraged to expand sales of show-home signage by Barratt Developments, which led directly to the creation of some amazing branded hoardings for the Royal visit.

Similarly Scotland’s Bravest Manufacturing Co. expanded its range of products with investment in a new state-of-the-art water jet cutter, completely transforming the scope for meeting customer needs, and the transferable skills that veterans can gain by using a machine that can surpass the capability of many commercial settings.

After two years of working closely with the charity Remembered, RBLI was gifted the There But Not There range of commemorative products and associated intellectual property rights. This in turn, lead to the creation of RBLI’s online shop promoting a range of Tommies including the garden Tommies and began with a solid base of over 9,000 customers which has continued to grow month on month, since January.

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FINANCIAL REVIEW For the year ended 31 March 2020 During the year the Charity generated income of £ 19.5m (FY 18/19 £22.3M). This reduction is primarily due to the previous year benefiting from the social enterprise sales to the charity Remembered recognising the 100 years since the end of WWI. A success story that we are now able to continue for the Financial Year 20/21 with the ‘Tommy’ brand and intellectual property rights now in the ownership of RBLI. Donations for this year have again been successful with a diverse range of funders donating £3.8m for the charity, much of this for the Centenary Village Project.

Total expenditure for the year was £19.2m (FY 18/19 £20.4m). A reduction in costs although in FY 18/19 the spike of selling TBNT increased both Revenue and Costs.

The latter part of the year saw a major restructuring project resulting in a £750k payroll saving per annum but much of this will not be realised until FY 20/21.

Overall it has been a challenging year for the Social Enterprises of RBLI. Scotland’s Bravest Manufacturing Company has completed its first full year of trading, is marginally below the original business plan projections and is looking to develop greater capacity in order to up production levels. Still very much in start up mode, this exciting new social enterprise’s growth will need the continued support of trusts and foundations as originally envisaged in the original business plan.

Britain’s Bravest Manufacturing Company, under its new director, has gone through a period of major review amid very challenging markets including the uncertainty of BREXIT transition period.

Significant internal changes include the introduction of an employees’ forum, new pricing matrices and a renewed emphasis on social value.

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Whilst both social enterprises continue to serve their purpose of supporting veterans and others with disabilities into employment they are both falling short of our ambition to reach a break-even scenario. Pricing strategy has already been reviewed in one area resulting in all customers agreeing to increased prices for FY 20/21; a similar review is planned for the other main area of the factory.

RBLI have also launched a new online shop which will be providing work for the factories.

Employment Services, supporting those with disabilities and health conditions held its own during the year (Net Result £500k loss for the year; the same as the previous year).

Our Living division has operated in a period of much transition as we demolish old accommodation stock ahead of the build of new care and accommodation facilities. This improvement to our services for our beneficiaries will at the same time move towards a positive financial position in FY 20/21 when Phase 2A of the Centenary Village is completed.

Net Income / Expenditure for the year was a loss of £211k after receipt of donations.

Investment Fund In March 2020 we raised £2,500k from the sale of part of our investment fund in readiness for the Gavin Astor Refurbishment project. Our investments were valued at £4,044k as at 31 March 2020 (2019: £7,068k). Allowing for the £2,500k divestment this is a loss in value of £500k. In turn, our investment Income was therefore marginally less than previous year at £203k (FY 18/19 £224k).

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Pension In addition to the above the Financial Statements show an actuarial loss for the defined benefit pension of £546k leading to a net movement in funds of £757k deficit and total charity funds of £24,020k. This is represented in a reduction of Unrestricted Funds to £12,880k but an increase in Restricted Funds to £11,140k (FY 18/19 £15,792k & £8,985k respectively).

The pension deficit reserve calculated per FRS102 is £2,604k (2019: £1,934k).

Investment Powers and Policy Investment powers are governed by the Memorandum and Articles of Association and permit the Charity’s fund to be invested in a wide range of assets. The trustees are currently considering adding an ethical investment restriction to the investment fund managers’ remit.

The Charity’s investments are held to achieve balanced long term growth and a level of investment income each year. Performance is measured against a long term target of CPI+3% per annum. Performance is also measured against a bespoke benchmark that reflects the fund asset allocation. Until January 2020 the portfolio performed well.

However February and March saw the gains eroded into a final year loss. However the fund remains on target over all years despite the last 2 months. Investment income achieved budgeted performance.

The Board reviews fund performance at every board meeting. Management meet with our investment managers quarterly and the investment managers present and report to the board on an annual basis.

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FINANCIAL REVIEW For the year ended 31 March 2020 Reserves and Reserves Policy Reserve Policy The reserve policy, reviewed annually by trustees, is to hold a sum of money as a designated fund in 2 parts as follows: An operating reserve of £5m, which equates to approximately 4 months of operating costs.

A reserve equating to the forecast cost to RBLI for planned future projects and developments, primarily accommodation and care facilities at Aylesford. This currently equates to £5m.

The Board has reviewed the reserve policy in the light of COVID-19 and given RBLI’s diverse revenue streams and our experience of lockdown, considers that the operating reserve of £5m, which equates to approximately 4 months of operating costs, is prudent.

Reserves

Unrestricted Reserves totalled £12.9m (2019: £15.8m) The operating reserve in a designated fund equates to £5m. The development reserve in a designated fund stands at £5m principally for the Centenary Village Project (£2m) and the refurbishment of our care home Gavin Astor House (£2m).

The pension deficit reserve calculated per FRS102 is £2.6m (2019: £1.9m.)

The General Fund of £5.6m (2019 £7.1m) reflects the infrastructure and tangible fixed assets used by the charity to support our beneficiaries in Aylesford and Leatherhead.

Within the General Fund are Free Reserves (Cash & Investments) of £4.3m (2019: £6.7m).

Restricted funds total £11.1m (2019 £9m).

In addition to the above the unrestricted fund also includes a sum covering the investment fair value reserve which equates to the difference between the original cost of the investments and their market value.

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Land and buildings shown on the balance sheet at historical costs less depreciation and have not been restated at market value. The one exception to this is the Vanguard Trust properties that were transferred to RBLI are shown at Market Valuation as at 2018. The valuation was carried out in September 2017 and we do not believe that the value would be materially different in value as at March 2020.

A professional valuation of all other land has not been done, however the trustees believe that the market value is significantly higher than the book value which is negligible as it was transferred to the Charity in 1919.

Going Concern The trustees have reviewed (once in March 2020 and again in September 2020) the future plans for the Charity and this combined with the strength of the balance sheet and future funds already secured are confident that the Charity will remain a going concern for many years to come. Consideration of COVID-19 pandemic is covered in more detail on page 43.

Pension Liability The Charity is a member of a multi-employer pension scheme with The Royal British Legion and The Poppy Factory.

The scheme is a defined benefit scheme. This scheme was closed to new entrants in 2002, but members are still accruing benefits. The scheme has a pension deficit, largely due to historic funding not achieving predicted returns required to ensure the scheme assets fully cover the liability. RBLI’s share of the deficit is £2.6m or approximately 16% of the total deficit as determined by our actuaries as part of the FRS102 Pension Liability Report.

over a 5 year period. The plan allows for a scrutinised charge over the Charity’s assets rather than a cash recovery plan. However, the recovery plan allows for a revision to the methodology subject to the future size of the scheme assets versus liabilities.

Fundraising RBLI’s fundraising priority is to secure capital donations for the Centenary Village expansion project which, once built, is a financially sustainable means of supporting hundreds more ex-service men and women, and their wider families. The charity must also raise significant donations for national welfare programmes, and is most grateful to those multi-year funders who give grants and donations to support this life-changing work and ensure that our programmes reach the veterans in greatest need wherever they are in the UK. The Charity also raises unrestricted income mainly through small trust and corporate gifts and through community and sporting events. RBLI did not engage any external fundraising agencies during the year. In 2019 we held our first mass participation event in partnership with Be Military Fit. Fitness sessions took place simultaneously in parks around the UK.

We are registered with the Fundraising Regulator and are signed up to the Code of Fundraising Practise and received zero complaints from supporters or members of the public during the year about our fundraising. We proactively involve beneficiaries in our fundraising activities, including older veterans and people with disabilities. We are proud that veterans were able to take part in our Menin Gate Cycle Ride, the Be Military Fit Sessions, and other events across the Village during our milestone centenary year. This means we liaise closely with our Welfare team who review and advise throughout, make sure there are disability adaptions in place, and RBLI has an extensive safeguarding policy to guide us in involving vulnerable people safely. Significantly in 2019/20 the charity also invested in a new legacy giving programme, a new online shop, and organised its first virtual sleep out, all activities that will help the charity grow new and sustainable sources of unrestricted income.

PLANS FOR THE FUTURE

Plans for the future are covered in the Strategic Report on page 42.

We have an agreed recovery plan with the Pension Scheme Trustees to fund the deficit 2019/2020 ANNUAL ACCOUNTS

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STRUCTURE, GOVERNANCE AND MANAGEMENT Governing Document Royal British Legion Industries is a charitable company limited by guarantee and was set up on 3 September 1919 and known as Industrial Settlements (Incorporated). It is governed

by Articles of Association which were last amended in September 2016.

Reference and Administrative Information The trustees in office during the year and at the date of this report, Senior Executives of the Charity, its principal places of business and its professional advisers are set out on page 72.

Board of Trustees The Board of Trustees are responsible for the overall governance, policy and work of the Charity. The Members of Royal British Legion Industries (RBLI) can appoint up to a maximum of 12 Trustees for the year from one Annual General Meeting to the next. If a vacancy arises, the trustees can co-opt a Member to fill a vacancy at any time.

Newly elected trustees are given induction training on their duties as Members of the Board and on their responsibilities as trustees.

In addition, they receive a copy of the Charity's Articles of Association, a copy of its latest reports and financial statements, details of the Senior Executives and their respective roles and details of future board meetings.

The Board governs the Charity within its Articles of Association and in line with its mission, charitable objectives and values. The Board provides overall policy direction and the management of the Charity is delegated to the Chief Executive and through him to the senior management team. The Board meets 32

quarterly and papers are made available prior to board meetings including business plans and budgets. Summary management accounts are reviewed by the trustees at each Board meeting.

The trustees confirm that reference has been made to the guidance contained in the Charity Commission's guidance on public benefit of the Charities Act 2011, when reviewing the Charity's aims and objectives and in planning future activities. The trustees and Senior Executives are involved in the strategic planning and their recommendations are then considered by the Board.

In addition to the quarterly board meetings the trustees also meet annually for a strategic review and planning day. The Board review existing operations of the charity and consider strategic options for the future. In addition to this the Board also consider their own effectiveness and practices.

A Board-led review of Governance was initiated in this period and will formally report at the end of FY20/21. The interim report states the spirit in which business is conducted at both Main Board and subcommittee meetings, with both trustees and members of the Senior Management Team appearing comfortable in addressing the Board or each other openly and plainly. The quality of the papers presented to the Board is generally of a high standard. The study team does not believe there is any particular underlying issue of significance in respect of RBLI’s governance. There is widespread positivity about the relationship between the Executive and the Board of Trustees. To further develop this good governance a new post of Head of Governance will be filled from 1st October 2020 to support the Board and Senior Management team in maintaining the highest

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standards across all aspects of the Code.

Estates Development matters are considered and reviewed by the Estates Development Committee which is chaired by a trustee and its recommendations are submitted to the Board of Trustees for its approval.

Care and Welfare matters are considered and reviewed by the Care and Welfare Committee which is chaired by a trustee and its recommendations are submitted to the Board of Trustees for its approval.

Statement of Trustees Responsibilities The trustees (who are also directors of Royal British Legion Industries for the purposes of company law) are responsible for preparing the Trustees' Report and the financial statements in accordance with applicable law and regulation.

Company law requires the trustees to prepare financial statements for each financial year.

Under that law the trustees have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).

Under company law the trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of the affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.

The trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions and disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Financial statements are published on the charity’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the charity’s website is the responsibility of the trustees. The trustees’ responsibility also extends to the ongoing integrity of the financial statements contained therein.

• select suitable accounting policies and then apply them consistently; • make judgements and estimates that are reasonable and prudent; 2019/2020 ANNUAL ACCOUNTS

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Pay Policy The Board of Trustees approve any relevant annual pay rise to all employees with the Senior Management Team receiving the same annual increase as all other employees.

When new members join the Senior Management Team, the Chairman or ViceChairman of the Board of Trustees are asked to approve relevant salaries and other compensation/rewards.

Out of cycle pay rises not covered by the annual process, require the approval of the Chief Executive and the Director of Finance and typically reflect a change of roles and responsibilities or a market change in a specific division or area of the Charity.

Where appropriate, staff with revenue targets benefit from a bonus system that rewards good performance.

All staff are encouraged to join the current pension scheme which is a defined contribution scheme. The Charity contributes to the scheme and the contribution is determined by the individual employee contribution level.

RBLI operates an objective and cost effective recruitment and selection process to ensure the appointment of the best people in accordance with RBLI’s standard recruitment criteria and to specific criteria established for a particular job. We are an equal opportunities employer and can demonstrate this commitment to providing equal opportunities through an effective, regularly reviewed, Equal Opportunities Policy. It is our aim to attract and recruit people with diverse backgrounds, skills and abilities who will enhance the quality of the service and contribute to RBLI’s success.

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Candidates are not discriminated against in any way and short listing is carried out against a set of defined criteria appropriate to the role. Consideration is given to any reasonable adjustments. Where RBLI are advised in advance of an interview by a candidate of any reasonable adjustments on the basis of a disability, every effort will be made to accommodate this request to ensure that no applicant is placed at a substantial disadvantage because of their disability.

The recruitment, development, promotion and treatment of employees, volunteers or job applicants shall be based solely on factors relevant to the job and performance and reasonable adjustment will be made accordance with the Equality Act 2010.

RBLI recognise that our continuing success and the achievement of business objectives is dependent upon having a well-trained, competent and motivated workforce.

We are committed to learning that enables everyone to carry out their jobs to a high standard to both their personal and customer’s satisfaction and to the achievement of business and care needs.

It is important to us that all employees have the necessary support and same opportunity for learning in RBLI, we do this in the following ways: • Providing appropriate induction training for new entrants and transferring staff • Identifying personal and organisational development needs and planning to meet those needs, both for now and into the future so that we can respond positively to change • Ensuring competence in job roles with 2019/2020 ANNUAL ACCOUNTS

knowledge, skills and behaviour • Develop a culture of participation and accountability • Provide opportunities for positive action and implementation of equality through targeted, accredited where appropriate, staff development and training.

Staff with disabilities will be invited to identify any particular requirements they may have to enable them to participate fully in all training and development events offered e.g. materials in alternative formats, sign language interpreters, ergonomic seating.

RBLI is proud to be a Disability Confident Leader.

RBLI aims to ensure that all employees are kept abreast of changes that not only affect them as individuals in regards to their employment, but that they also provided with wider information relating to the challenges and successful performance of the organisation. Due to the diverse nature of RBLI this information is disseminated via various means through companywide and departmental electronic and print notifications, employee forums and formal and informal team meetings. Examples of this include regular company welcome days for new starters and annual chief executive informative roadshow events.

Not only is the company keen to ensure it is sharing information, it is of importance that a two way dialogue and consultation is prevalent at all layers of the organisation. On an individual basis this can best be seen in the annual appraisal meetings that employees undertake with their line managers which

highlights the success, challenges and personal objectives of employees and how these have a contributing factor the financial success and growth of the organisation enabling more support for beneficiaries. On a wider scale employee forum meetings are also used to discuss issues relevant to their division and to enable consultation with employees through their elected representatives on changes, ways of working and new business opportunities that may have an impact on the productivity and services of that division.

A particularly good example of this is one of our manufacturing divisions, Britain’s Bravest Manufacturing Company.

Directors have a vital role to play in engaging with the wider workforce and taking consideration of employee interests when making company wider and individual decisions. Directors undertake engagement on a direct basis with employees, divisionally this is done on a daily and weekly basis within the working environment. This is also completed via regular head of department meetings with directors, director attendance at departmental updates, and a culture built on open and transparent escalation where this is required.

The senior management team will actively seek the views of employees on key issues relating to them regarding the necessary financial decisions of the company, part of this can be seen informally through employee ideas generation, and our fundraising team and director are a great example of this. This can also be seen in how the company adheres to statutory consultation requirements for example in redundancy circumstances, in which directors will play a direct role.

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Trustees duty to promote success of the Charity – Section 172 statement Trustees have a duty to promote the success of the Charity and, in doing so, are required by section 172(1) of the Companies Act 2006 to have regard to various specific factors including: • the likely consequences of decisions in the long term • interests of employees • the need to foster the Charity’s relationships with third-party stakeholders • impact of Charity operations on the community and the environment • the desire for the Charity to be best in class for providing support to beneficiaries.

The trustees delegate day to day management and decision making of RBLI’s operations to its Chief Executive and Senior Management team, who are required to implement the Charity’s strategic plan and ensure all policies, approved by trustees, are complied with. Trustees are members of various committees with Senior staff as well as receiving operational update at regular board meetings to ensure the Charity on target to meet its objectives to beneficiaries and the wider community.

Engaging with our stakeholders Through regular engagement with key stakeholders, we maintain an understanding of their needs that informs how we design our services, objectives, policies, strategy and influencing goals. The decision-making process within both the senior leadership team and the Board of Trustees considers the impact of potential decisions on relevant internal and external stakeholder groups.

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People in need Our beneficiaries receive a wide array of support services and we employ differing methods of engagement and feedback mechanisms as appropriate. Our Village Residents’ have an active Association with regular meetings which are attended by a Director and relevant support staff. The beneficiaries working in our Social Enterprises have a staff forum, receive regular newsletters and briefings. Our Veteran and family members on our employment programme LifeWorks have formal feedback sessions whilst in group sessions and post the events via a structured telephone call back programme.

Our supporters We consult our supporters about our fundraising activities in a number of ways. As RBLI is relatively new to community and events fundraising we have been able to create events and activities based on our supporter and partner interests. For example we organised places in a cycling event purely because a supportive solicitors firm had a cycling group.

We also work hard to involve beneficiaries in our fundraising so that supporters have a chance to meet people they are helping. We apply this same principle to the sales of our products, helping customers understand the people supported by their transaction. We regularly invite supporters to visit and see our services in full, meet the staff and engage with those receiving support. In this way we can all learn from the experience of others, hear firsthand about changing goals and pressures, and also inspire individuals to succeed. We send out regular updates and during the pandemic we were lifted by the many responses of moral encouragement and financial support which enabled us to continue doing our work. We work on the principle that visitors not only bring us luck but also give us ideas and lessons for future service development and improved communications.

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Our customers We work in an open and transparent way with all of the customers who work with our two social enterprises. We have shared speaking platforms with key customers, such as Amey, Bear Scotland, and Balfour Beatty, at events promoting social value and disability employment. We have engaged with customers by offering their staff volunteering days with our teams, supported their graduate development programmes and had joint PR opportunities to demonstrate the value in strong partnerships. We work extremely closely with our corporate supporters to help achieve their goals, including their veteran recruitment goals. Barratt Developments were awarded the 2020 Charity Times Corporate Partnership of the Year award for the outstanding and multi-layered engagement with RBLI. Key leaders and other influencers We continue to work closely with key opinion leaders and influencers in both national and local Government, and this work happens across all our varied activities and divisions.

The newly formed Office of Veterans’ Affairs chose to launch its opening with our Veterans on our site in Kent drawing attention to the importance of more holistic services.

Our Chief Executive was awarded, in 2020, Kent County Council’s Invicta Award for exceptional services to the County. We strive to work in partnerships with a wide range of other charities and we actively support the objectives of Cobseo, the Confederation of Service Charities through participation in their cluster groups and also key conferences sharing best practice, identifying need, and collaborating on national campaigns, for example on the successful veteran census campaign “Count them in”. We are very proud to be a driver for increased collaboration in the military charity sector as a whole establishing more new welfare partnerships every single year.

We are active members of the British Association of Supported Employment (BASE) and we work with DWP and others to improve the employment opportunities of people with disabilities and health conditions. The design of our Centenary Village, with its integrated wrap-around services has also been recognised by leaders and influencers in planning as an exemplar in community creation. During the COVID-19 crisis leaders and influencers in the nursing and care sector, particularly in Wales, were engaged in RBLI’s work increasing the recognition for care workers on the front line.

Our staff and volunteers Our senior leadership team conducts periodic surveys for staff and volunteers and assesses outcomes and actions. In addition, specific surveys are implemented, such as the one to measure the impact of COVID-19 across a workforce split between the workplace, working from home and on furlough. We have quarterly newsletters to all staff and the frequency was increased to weekly during the first 4 months of the pandemic. There is currently a weekly health and wellbeing newsletter with a specified manager to receive feedback and recommend actions.

The Chief Executive runs an annual series of roadshows which update all staff on strategy, policies and objectives which encourages a healthy discussion period in each area of the charity. These are supported by a culture of regular briefings and a policy of visible and open leadership. We are accredited IIP and this provides an independent source of feedback and appropriate action plans. Our staff forums in our social enterprises in Scotland and England are a shining example of excellent staff engagement, with extra support to those with learning difficulties, and have proved particularly effective during this COVID-19 affected period.

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Sustainability and Environment As a respected charity which puts at its heart care for individuals by “improving lives every day”, not only do we need to ensure the wellbeing of our beneficiaries, but we also plan to go beyond this to ensure that all we do minimises our impact on the environment. As such, reducing our carbon footprint, waste and caring for the natural resources we own are all accepted and even expected ways that also “improve lives every day”.

As a charity with a clear focus on employability and skills we recognise that our environmental strategy and goals (e.g. reducing waste in manufacturing processes, reducing packaging in customer fulfilment, identifying product adaptions) can offer our beneficiary employees transferable work experience and new skill development opportunities. We will proactively create these opportunities for our beneficiaries.

During the Year consumption of energy was:

Leatherhead Site 15k Kwh Scotland Site 1021k Kwh Aylesford Site 1940k Kwh Sent waste wood for recycling 385 Tonnes Total Consumption 2976k Kwh

Indirect Emissions from purchased energy 627 tCO2e Emissions per FTE 1.98 tCO2e/FTE

RBLI agreed a new policy on the environment with an action plan for commencement on 1st April 2020; due to COVID-19 this start date is now 1st October 2020. The action plan for the first 12 months includes: •

A fuller understanding of our legal requirements and the industry guidelines and identify key measurements that are relevant to each division.

•

Conduct an internal audit and carry out a benchmarking exercise across the organisation/divisions against the agreed metrics.

•

Establish an environmental working party drawn from across RBLI and as a minimum be trustee led, sponsored by a director and with representatives from across the RBLI and our many locations.

•

Create an environmental statement and pan-organisational five year strategy.

•

Create divisional frameworks with annual objectives to support the delivery of the organisation’s strategy.

•

Understand the financial impact of the implementation of the strategy.

•

Issue an overarching and resourced plan to meet the environmental demands placed upon the charity.

Methodolgy for reporting emissions is based upon those areas where we have operational control and are charged for energy consumption. Emission calculations are derived from billing data. Where bills did not complete a full year an estimate, based upon previous consumption, has been included for the missing month.

In addition to sending waste wood for recycling a machine was acquired to convert cardboard sheets into sign packaging for product protection during travel instead of buying bubble wrap.

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STRUCTURE, GOVERNANCE AND MANAGEMENT CONTINUED

the future. At this stage it is impossible to quantify any likely effect in either the Charity's investments or those programmes that we deliver that are ESF funded. At an operational level both customers and suppliers are being reviewed to assess the impact of leaving the EU without a trade deal, currently the impact appears to revolve around the factories where some supplies originate outside EU but are supplied through the EU. Alternative suppliers are being identified.

Risk Management The Charity operates a risk reporting matrix that is reviewed by the Board of Trustees at every Board meeting. The matrix is updated in real time as events or issues emerge and wherever possible alternative scenarios are evaluated and relevant action plans or strategies are developed to help plan through and mitigate any possible material risk that may emerge.

Principal Risks and Uncertainties The major risks that could negatively and materially impact the Charity in the medium and long term are as follows: •

•

The Government removes the Supported Factory Grant used to support disabled employees in the Britain's Bravest Manufacturing Co. The grant provides help and support for those employees with the most profound disabilities at both Aylesford and Leatherhead. As previously mentioned RBLI is midway along a ten-year year strategy. As part of the mid-way review consideration is being given as to how the final stages of the plan will be delivered, even if this grant is not available beyond the next couple of years.

The majority vote for the leave campaign for the UK to leave the European Union may have an adverse effect on the Charity at some time in

•

Investment management adopts a risk spreading policy within the investments. This includes monitoring exposure to currency and EU markets.

•

Towards the end of the Financial Year the COVID-19 pandemic became apparent. Further discussion on COVID-19 is presented in the Strategic Report.

Directors' Indemnities As permitted by the Articles of Association, the Directors/Trustees have the benefit of an indemnity which is a qualifying third party indemnity provision as defined by Section 234 of the Companies Act 2006.

The indemnity was in force throughout the last financial year and is currently in force.

The Charity also purchased and maintained throughout the financial year Directors' and Officers' liabilities insurance in respect of itself and its Directors/Trustees.

Statement of Disclosure of Information to Auditors Insofar as the trustees are aware: •

there is no relevant audit information of which the charitable company's auditors are unaware; and

•

the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information.

The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Independent Auditors A resolution proposing that BDO LLP be reappointed as auditors of the Charity was put to the Board at the Annual General Meeting and passed.

Approved by the Board and signed by its order by

Stephen Kingsman CHAIRMAN 13th October 2020

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STRATEGIC REPORT FOR THE YEAR ENDED 31 MARCH 2020

Business Review

Future Plans

To better position the charity for the challenges in the short to medium term, a major re-structuring, Project RESOLVE, was completed in-year and the full impact of the £750,000 per annum savings will be felt from FY 20/21 onwards. The major challenges facing RBLI are as follows:

After the successful collaboration with the Remembered Charity, RBLI will continue working with other Armed Forces charities under the auspices of Cobseo, the confederation of service charities, to help better shape the sector to meet future demands of our veterans and their families.

•

Securing and retaining a sufficiently high level of demand for the signs and wooden products areas of our Social Enterprises.

As the BREXIT uncertainty showed, sharp falls in demand impact immediately on the P&L. Government prioritisation on infrastructure and housebuilding should help in the medium term but there still remains the uncertainty of BREXIT in this next period.

RBLI's Centenary Village, will complete in the next 3 years, with 100 extra accommodation offerings to veterans and their families and our community based system of integrated services will be an exemplar for others to replicate. The opening of 24 assisted living homes, 12 apartments and 4 family houses will be in late 2021. Training of staff for our exciting new dementia care service has already started.

RBLI’s position as a significant Prime Provider to the Department of Work and Pensions on the Access to Work contract is due for renewal in mid-2021. This is a flagship disability programme for RBLI’s Employment Solutions team and as we go to print it is not known whether DWP will extend the contract by a further 2 years or seek a re-let at contract end, however contract negotiations are ongoing.

Our successful STEP IN programme is receiving growing interest as the scale of delivery increases with more of residents of all ages. The programme is replicable and adaptable for other providers and working with Erskine, alongside Scotland's Bravest Manufacturing Co, we expect to see the first large scale replication. As an effective model of integrated support STEP IN is relevant to health provision, particularly where increased daily mobility is a critical success factor for patient outcomes. The model is also relevant to social housing provision of all kinds where residents need increased structure to support their employability and life goals.

The model is important for older care, where activity, participation and purpose are key to measurable health and independence gains.

•

•

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The £3.5m refurbishment and reconfiguration of our care home Gavin Astor House will commence in September 2020 and this move from 50 beds high dependency to 24 beds dementia and 26 beds high dependency will complete our care pathway. Occupancy levels will reduce to below 50% for the one year duration of this construction work with a resultant impact on revenue.

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Our Social Enterprises, as well as diversifying products and services, including home builder signage, non-reflective signage and recycling are also now seeking more products for B2C opportunities which increases skills and work experience opportunity for beneficiaries. The next 3 years will also see tangible steps in the creation of an Academy model, alongside the social enterprises, delivering accredited training. The Academy, which will be covered

by OFSTED regulations, remains at concept stage only and we have yet to evaluate a range of options including a decision on whether this is in-house or outsourced provision.

To achieve the ambitions we have for our beneficiaries, there is a need to continue growing our unrestricted income for RBLI – through sales of merchandise, growing Tommy brand, a growing legacy programme, individual donations and mass participation in fitness challenges. Her Majesty’s visit has shone a spotlight and many more individuals have seen the practical support RBLI can give and want to help and support the charity.

COVID-19 The COVID-19 pandemic which hit the nation very hard in the Spring of 2020, and peaked in London on the weekend of 18 April, had a major impact on RBLI as a charity. The invisible and unpredictable threat caused serious distress, particularly in RBLI’s 3 care homes, impacting the older residents and care team most profoundly. For several particularly awful weeks in April, RBLI’s nurses were most certainly on the front line.

During the same lockdown period, while care costs were rising due to care staffing challenges, and urgent PPE demand, RBLI

closed all services which depend on face-toface delivery, including our large scale back to work and employment outreach programmes.

As a result the charity needed to start spending down its financial reserves.

RBLI’s social enterprise factories were able to continue operating during lockdown, as manufacturing workers on health and safety signage, and pallet manufacture were deemed essential to the national supply chain. Britain’s Bravest Manufacturing Co. was also able to help Tonbridge and Malling Borough Council store and package emergency food supplies.

RBLI’s social enterprise factory also helped the nation mark the 75th Anniversary of VE Day on 8 May by making an exciting new special edition consumer product and launching the “Tommy in the Window” campaign. A new 75th Anniversary VE Day Tommy was made, and was endorsed on BBC SE, Sky News, Good Morning Britain and Channel 5 News

by General The Lord Dannatt. With the nation in lockdown, people were looking for ways they could mark the day safely, and were able to draw strength from remembering their relatives’ contribution. Over 32,000 Tommy products were sold to the British public, who expressed their pride and respect by putting Tommy in the window for all to see. Additional workers were brought in to the social enterprise with an army of volunteers joining on site and working safely from home. On the 8th May anniversary itself resident George Bradford, 89-year-old Royal Marine, held the 11am silence outdoors for QEC residents to hear safely. This was filmed and shared by 29,000 people using Facebook Live. The Tommy in the Window campaign raised £1m for RBLI, helping the charity to get through the most difficult period financially.

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STRATEGIC REPORT CONTINUED

It is too early to know the full financial impact of the pandemic as the economic impact is still unfolding. For RBLI’s social enterprises we are very hopeful that all our customers in construction and infrastructure can survive, and the early signs are encouraging. We felt it important to include this update and clarify that although RBLI’s operating reserve is now at £5.6m, the government’s furlough scheme was extremely helpful, as were the emergency funds created at speed by philanthropic organisations. The charity has also had success during the crisis and with thanks to our loyal donors, our volunteers and the Great British public, RBLI has been able to get through the COVID-19 lockdown with its finances secure.

On 1st July 2020 Village residents recognised the carers’ incredible efforts, by presenting a unique Thank You award. The whole charity got behind this initiative to recognise their colleagues.

Faced with an unprecedented nursing situation, RBLI’s nursing and care team rose to the challenge with professionalism, compassion, and resilience.

As we go to print the ramifications of COVID-19 are still developing. Our care teams have been very much on the frontline and we formally thanked 44

them for their tremendous work in testing conditions with a formal ‘Thank You’ ceremony on 1st July. The charity continues to focus on protecting people, protecting our finances and delivering our purpose and outcomes. To that end, both of our strategic development projects are continuing at some pace, with the groundworks for the Centenary Village Phase 2A completed to target and the refurbishment of Gavin Astor House starting on 1st September as planned. In such uncertain times, RBLI has remained safe but also very positive and passionate about delivering our services to those that need them.

The trustees reviewed RBLI’s financial plans on 28th March, as part of the normal annual review, as well as our principle financial risks. At that time, they were satisfied that RBLI had sufficient resources to continue operating for the foreseeable future and accounts have been prepared in the knowledge that RBLI is a financially viable organisation.

Since then, the effect of COVID-19 has also been assessed by the trustees in July 2020, reviewing the organisation’s ongoing forecasts and projections to ensure that the organisation remains financially viable. With regard to the next accounting period, 2019/2020 ANNUAL ACCOUNTS

the year ending 31 March 2021, the most significant areas that are likely to affect the charity’s net assets are revenue streams, value of investments and an increase in liabilities to the now closed defined benefit scheme.

Since the year-end, as a result of the effects of COVID-19, all these areas have either deteriorated or are expected to. Fundraising has, for RBLI, taken a significant turn for the better with both emergency funding and a rapid switch to online events lifting in-year performance above pre COVID-19 forecasts.

Our new online shop raised circa £500k in the first two months of this new financial year. The charity’s listed investments have also fallen significantly in value, albeit an early decision to divest £2.5m to fund construction projects minimised the immediate impact. The future remains uncertain, whilst we await to see the impact on pension fund liabilities when the triennial review reports and we await to see whether our planned operations are significantly affected by spikes this winter.

The cost-cutting measures taken earlier this year as part of Project RESOLVE, plus the positive impact of furlough and other Government support plus contract variations with DWP have meant that we have not had to reduce costs by reducing services and cutting staff. Interruptions to our services have been due to social distancing. Our services, such as disability assessments, paused for a while but are now very much back up and running virtually and our veterans employment services, LifeWorks, have recommenced both virtually and face to face since the beginning of August. The Trustees have been holding monthly Board meetings and have been supporting a planned and positive approach through this period

resulting in a first quarter financial result some £200k better than pre-COVID-19 budget. This is likely to sustain to the half-year point.

Contingency planning for a tough winter is well underway and all non-essential capital expenditure, apart from the two major Village development projects, is curtailed and we have a renewed focus on fundraising and our online shop to generate more income.

The trustees will continue to review plans with RBLI’s executive team to make the necessary changes to remain within free reserves policy level over the life of the 3-year plan. RBLI has a strong balance sheet, with unrestricted liquid investments of £4m. Should the income predictions fall short of the 3-year plan, the trustees have contingency arrangements of £2m secured overdraft facility and a £1.5m loan facility to manage cash flow requriements, if needed. The trustees are therefore of the opinion that the charity will have sufficient resources to meet its liabilities as they fall due.

As such, they remain satisfied that the RBLI can continue operating for the foreseeable future and accounts have been prepared in the knowledge that the RBLI is a financially viable organisation.

Stephen Kingsman CHAIRMAN 13th October 2020

2019/2020 ANNUAL ACCOUNTS

45

INDEPENDENT AUDITORS’ REPORT For the year ended 31 March

have audited the financial Companies Act 2006, Independent We statements of Royal British Legion the Charities and Trustee Industries Limited (“the Charitable Investment (Scotland) Act auditors’ Company”) for the year ended 31 2005 and regulation 8 of the March 2020 which comprise the Charities Accounts (Scotland) report statement of financial activities Regulations 2006, as amended to the (incorporating the summary in 2010. and expenditure account), Basis for opinion members of income the balance sheet, the statement We conducted our audit in cash flows and notes to the Royal British of accordance with International financial statements, including a on Auditing (UK) Legion summary of significant accounting Standards (ISAs (UK)) and applicable law. policies. The financial reporting responsibilities under those Industries framework that has been applied Our standards are further described preparation is applicable in the Auditor’s responsibilities Limited inlawtheir and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements: •

46

give a true and fair view of the state of the Charitable Company’s affairs as at 31 March 2020 and of its incoming resources and application of resources for the year then ended;

•

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

•

have been prepared in accordance with the requirements of the

for the audit of the financial statements section of our report. We are independent of the Charitable Company in accordance with the ethical requirements 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.

Conclusions relating to going concern We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where: •

the trustees’ use of the going concern basis of accounting 2019/2020 ANNUAL ACCOUNTS

in the preparation of the financial statements is not appropriate; or •

the trustees have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Charitable Company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information The other information comprises the information included in the Trustees’ Report other than the financial statements and our auditor’s report thereon. The other information comprises: the Chairman and Chief Executive’s Review, the Report of the Trustees and the Strategic Report. The Trustees are responsible for the other information.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audit: •

the information given in the Trustees’ Report, which includes the Directors’ Report and the Strategic report prepared for the purposes of Company Law, for the financial year

for which the financial statements are prepared is consistent with the financial statements; and •

the Strategic report and the Directors’ Report, which are included in the Trustees’ Report, have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception In the light of the knowledge and understanding of the Charitable Company and its environment obtained in the course of the audit, we have not identified material misstatement in the Strategic report or the Trustees’ report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities and Trustee Investment (Scotland) Act 2005 requires us to report to you if, in our opinion; •

proper and adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

2019/2020 ANNUAL ACCOUNTS

47

•

the financial statements are not in agreement with the accounting records and returns; or

•

certain disclosures of Directors’ remuneration specified by law are not made; or

•

we have not received all the information and explanations we require for our audit.

Responsibilities of Trustees As explained more fully in the Statement of Trustees’ Responsibilities, the trustees (who are also the directors of the charitable company for the purposes of company law) are 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 trustees determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the Charitable Company’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 trustees either intend to liquidate the Charitable Company or to cease operations, or have no realistic alternative but to do so.

48

Auditors’ responsibilities for the audit of the financial statements We have been appointed as auditor under section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and under the Companies Act 2006 and report in accordance with the Acts and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole 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 on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (“FRC’s”) website at: https://www.frc.org.uk/ auditorsresponsibilities. This description forms part of our auditor’s report.

Use of this report This report is made solely to the Charitable Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, and to the Charitable Company’s trustees, as a body, in accordance with the Charities and Trustee Investment (Scotland) Act 2005. Our audit work has been undertaken so that we might state to the Charitable Company’s members and trustees 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 Charitable Company, the Charitable Company’s members as a body and the Charitable Company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Jill Halford (Senior Statutory Auditor)

For and on behalf of BDO LLP, statutory auditor London Date: 13 October 2020 BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

2019/2020 ANNUAL ACCOUNTS

2019/2020 ANNUAL ACCOUNTS

49

THE NUMBERS

STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING THE SUMMARY INCOME & EXPENDITURE ACCOUNT) FOR THE YEAR ENDING 31 MARCH 2020

BALANCE SHEET AT 31 MARCH 2020

FY 19/20 Unrestricted Funds

FY 19/20 Restricted Funds

FY 19/20 Total Funds

FY 18/19 Unrestricted Funds

FY 18/19 Restricted Funds

FY 18/19 Total Funds

£000s

£000s

£000s

£000s

£000s

£000s

472

3,329

3,801

229

4,251

4,480

Employment Solutions

4,001

508

4,509

4,009

664

4,673

Britain's Bravest Manufacturing

5,578

268

5,846

7,514

245

7,759

RBLI Living

5,059

60

5,119

4,854

353

5,207

14,638

836

15,474

16,377

1,262

17,639

203

-

203

224

-

224

15,313

4,165

19,478

16,830

5,513

22,343

Note Income from: Donations and Legacies Charitable Activities:

Total Charitable Activities Investment Income

4

Total

FY 18/19

Note

£000s

£000s

Tangible assets

7

18,437

16,778

Investments

8

4,044

7,068

Investment in subsidiary

9

-

-

22,480

23,846

FIXED ASSETS

TOTAL FIXED ASSETS CURRENT ASSETS Stocks and work in progress

10

481

526

Debtors

11

2,203

2,369

Cash at bank and in hand

4,180

3,170

TOTAL CURRENT ASSETS

6,864

6,065

( 2,720 )

( 3,200 )

( 2,720 )

( 3,200 )

CURRENT LIABILITIES

Expenditure on: Raising Funds

FY 19/20

Creditors – amounts falling due within one year

12

5

1,037

77

1,114

684

167

851

Employment Solutions

5

4,152

815

4,967

4,531

606

5,137

Britain's Bravest Manufacturing

5

7,048

439

7,487

8,238

518

8,756

NET CURRENT ASSETS

4,144

2,865

RBLI Living

5

4,993

674

5,667

4,723

952

5,675

TOTAL ASSETS LESS CURRENT LIABILITIES

26,624

26,711

NET ASSETS (excluding pension scheme liability)

26,624

26,711

Total Expenditure

5

17,230

2,005

19,235

18,176

2,243

20,419

( 1,917 )

2,160

243

( 1,346 )

3,270

1,924

16

( 2,604 )

( 1,934 )

( 449 )

(5)

( 454 )

231

-

231

14, 15

24,020

24,777

( 2,366 )

2,155

( 211 )

( 1,115 )

3,270

2,155

Unrestricted - Designated

15

10,000

10,000

Unrestricted - General

15

5,624

7,141

Fair Value Reserve

15

( 140 )

585

15,484

17,726

( 2,604 )

( 1,934 )

12,880

15,792

11,140

8,985

24,020

24,777

Charitable Activities:

Net (Expenditure)/Income before Investment (Losses)/Gains (Losses)/Gains on investments assets

8

Net (Expenditure)/Income Other recognised gains and losses Actuarial Loss on defined benefit pension scheme Net movement in funds

16

Fund balances brought forward at 1st April Fund balances carried forward at 31st March

14

Defined benefit pension scheme liability NET ASSETS (including pension scheme liability) THE FUNDS OF THE CHARITY

( 546 )

-

( 546 )

( 222 )

-

( 222 )

( 2,912 )

2,155

( 757 )

( 1,337 )

3,270

1,933

15,792

8,985

24,777

17,129

5,715

22,844

Restricted Income Funds

12,880

11,140

24,020

15,792

8,985

24,777

TOTAL CHARITY FUNDS The notes on pages 19 to 29 form part of these financial statements.

All of the current year results above are derived from continuing activities.

The notes on pages 53 to 70 form part of these financial statements.

Pension Reserve

15

Total Unrestricted Income Funds 14, 15

The Financial Statements which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows and the related notes were approved by the Board of Trustees on 2nd October 2020 and were signed on its behalf by:

Mr Stephen Kingsman 13th October 2020

50

2019/2020 ANNUAL ACCOUNTS

Mr A B Gulland 13th October 2020

2019/2020 ANNUAL ACCOUNTS

51

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2020

CASH FLOW

FY 19/20 Note

Net cash ( outflow ) / inflow from operating activities

£000s

FY 18/19

£000s

£000s

£000s

737

22

2,461

Investments

Investment Income

203

Net cash inflow from investments

224

203

224

Capital expenditure and financial investment

Payments to acquire tangible fixed assets Receipts from the sale of Investments

( 2,430 )

( 3,680 )

2,500

-

Net cash outflow from capital expenditure & financial investment

70

( 3,680 )

(Reduction) / increase in net cash

1,010

( 995 )

Balance brought Forward

3,170

4,165

Balance Carried Forward at 31 March

4,180

3,170

Net cash at 31st March 2019

3,170

4,165

Net Cash (outflow) / inflow

1,010

( 995 )

Net Cash at 31st March 2020

4,180

3,170

Analysis of changes in net cash / (Debt)

52

NOTES TO THE FINANCIAL STATEMENTS

2019/2020 ANNUAL ACCOUNTS

1. ACCOUNTING POLICIES Going Concern The trustees reviewed RBLI’s plans in March 2020 and were content that these plans were affordable and the accounts should be prepared on a going concern basis. Taking into account the impact of COVID-19 the Board has, in September 2020, completed a strategic review and cash projections out to March 2022 and beyond. The Board notes that, significantly, the first six months of the pandemic had no overall adverse impact on the planned financials and therefore RBLI is well placed to face any disruption caused by the tail of the pandemic. Further to this there is recognition that the charity retains a strong balance sheet (£24.0m), healthy cash holdings and significant value held in land values on the Village site. The only significant commitments over the next 18 months are the construction projects which will provide much needed support to the beneficaries and also return a healthy year-on-year new income stream.

Based on this review the Board is satisfied that RBLI is financially viable for the next 12 months and beyond.

The impact of recent COVID-19 outbreak and its potential financial impact required the trustees and executive team to revisit these plans and make adjustments to ensure RBLI’s finances were secure for the next 12 months and beyond. The initial few months of the new financial year required swift and decisive action by the trustees and executive team making appropriate use of the Government’s furlough scheme. To avoid an adverse impact on RBLI’s fundraising, the team swiftly switched from raising capital funds for the Centenary Village to obtaining emergency funding to assist RBLI through the initial pandemic. Fundraising activities were redesigned to be possible via online communities. The result of these actions and a very successful online shop campaign

resulted in RBLI outperforming the original plans made for the new financial year. As at July 2020 RBLI was £200k ahead of budget as they began to restart all the factories and return to the original plans for FY 20/21.

The trustees and executive remain vigilant, with regular communications, to monitor RBLI as it emerges from lockdown. The feedback from donors, where relationships have been nurtured over several years, indicates that the original targets for raising Centenary Village funding remain achievable and with only a few months delay to original timescales. Funds have been secured to ensure that the Gavin Astor House refurbishment, to high quality dementia and nursing suites, started on time on 1st September 2020. The construction of Phase 2A of the Centenary Village commences on 5th October and the completion of these nationally significant development projects will not only provide vital care and accommodation for our Veterans but will significantly boost revenues in the second half of 2021.

The next 12 months will not be without some turbulence from the tail end of the pandemic and the Board is not complacent about the future. RBLI starts from a position of strength and the diverse nature of RBLI provides some protection in that revenue streams are equally diverse. Fixed costs were reduced at the end of the last financial year and the lessons of lockdown have provided lessons in deploying the workforce in the social enterprises more flexibly to meet changing demands. The online shop sales are consistently growing month on month and are significantly surpassing budgeted trends; this will benefit fundraising and also provide more work for the social enterprises. Social enterprise order books are currently better than this time last year.

2019/2020 ANNUAL ACCOUNTS

53

NOTES TO THE FINANCIAL STATEMENTS

Grants Received Grants are recognised in the Statement of Financial Activities when the conditions for entitlement have been met. Grants received before the conditions for entitlement have been met are deferred and included in creditors at year-end.

CONTINUED

1. ACCOUNTING POLICIES continued RBLI’s balance sheet, currently standing at £24.0m, remains part of the underlying strength of the Charity and the land holdings across the 75 acre site in Kent adds significantly to its financial security. Investment income will inevitably remain depressed but this has been an insignificant proportion of annual income.

At the time of writing the investment portfolio has recovered some of its initial COVID-19 fall and our cash flow planning does not envisage any divestment in the next 12 months.

The trustees will continue to review plans with RBLI’s executive team to make the necessary changes to remain within the free reserve policy level over the 3-year plan. RBLI has a strong balance sheet, with unrestricted liquid investments of £4.0m.

Should the income predictions fall short of the 3-year plan, the trustees have contingency arrangements of £2.0m secured overdraft facility and a £1.5m loan facility to manage cash flow requirements, if needed.

The trustees are therefore of the opinion that the charity will have sufficient resources to meet its liabilities as they fall due.

Basis of Accounting The Financial Statements have been prepared in accordance with the Charities SORP, FRS102 The Financial Reporting Standard applicable in the UK and Republic of Ireland, and applicable UK charity and company law.

The principle accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented unless otherwise stated.

These financial statements are prepared on a going concern basis under the historical cost 54

convention, as modified by the recognition of certain financial assets and liabilities measured at fair value.

Consolidation The company has a wholly-owned subsidiary company, RBLI Contracts Limited. Consolidated financial statements have not been prepared as it has been dormant for several years and the activities of the subsidiary are not material to the group. Information concerning the subsidiary is set out in note 9.

Funds The charity maintains the following funds:Restricted – where the purpose to which the funds may be used has been restricted by the donors Unrestricted – where the fund is not restricted as to its use.

Designated – where the funds are unrestricted but the Trustees have designated them for a specific purpose.

Funds have been set up and designated by the Board of Trustees and transfers between funds are agreed by the Trustees.

Income Recognition Charitable activity income is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied or services rendered, net of returns, discounts and rebates allowed and value added taxes. Donations are recognised as income when received or when entitlement to receive has been established, receipt is probable, and the amount can be quantified with reasonable accuracy. Gift Aid receivable is included when claimable. Legacies are recognised when probate is granted and there is sufficient information to measure them.

2019/2020 ANNUAL ACCOUNTS

Subsidies Receivable A subsidy is made to host companies who employ a disabled person under the terms of the Work Choice Programme. The subsidy arises on the employment of the disabled person and remains for the term of the employment contract. It is accounted for on an accruals basis.

Pensions The Charity operates two pension schemes, the Defined Benefit Scheme which was closed to new entrants in 2002 and the Group Personal Pension Scheme.

The Defined Benefits scheme, the assets of which are held and managed separately, is a multi-employer scheme. The actuaries have attributed scheme assets and liabilities to RBLI for the requirements of FRS102. The impact on the current year SOFA was an actuarial loss of £546k and a deficit on the balance sheet of £2,604k.

For the defined benefit section the amounts charged in expenditure are the current service costs and gains and losses on settlements and curtailments. They are included as part of staff costs. Past service costs are recognised immediately in the Statement of Financial Activities if the benefits have vested. If the benefits have not vested immediately, the costs are recognised over the period until vesting occurs. The interest cost and the expected return on assets are shown as a net amount of other finance costs or credits adjacent to interest. Actuarial gains and losses are recognised immediately in ‘Other recognised gains and losses’.

The Defined Benefit schemes is funded, with the assets of the scheme held separately from those of the underlying employers, in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the

projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the scheme liabilities.

The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The resulting defined benefit asset or liability, net of the related deferred tax is presented separately after other net assets on the face of the balance sheet.

In addition the amount charged to the Statement of Financial activities includes contributions payable to the Group Personal Pension Scheme in the year.

Short term benefits Short term benefits, including holiday pay, termination payments and other similar nonmonetary benefits, are recognised as an expense in the period in which the service is incurred, or in the case of Redundancy and termination payments when there is a commitment to an individual or group of people.

Taxation The company is a registered charity, and as such is entitled to certain tax exemptions on income and profits from investments, and surpluses on any trading activities carried on in furtherance of the charity’s primary objectives, if these profits and surpluses are applied solely for charitable purposes.

Cash and cash equivalents Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less and bank overdrafts. Bank overdrafts, when applicable, are shown within borrowings in current liabilities.

Investments Investments are stated at fair value and the value of both realised and unrealised gains are included in the Statement of Financial Activities within the relevant Funds. Investments are subject to review for impairment when there is an indication of a reduction in their carrying value. Any impairment is recognised in the year in which it occurs.

2019/2020 ANNUAL ACCOUNTS

55

NOTES TO THE FINANCIAL STATEMENTS

Stock provisioning At each balance sheet date the charity considers the recoverability of the cost of stock and the associated provisioning required. When calculating the stock provision, management considers the nature and condition of the stock, as well as applying assumptions around anticipated saleability of finished goods and future usage of raw materials.

CONTINUED

1. ACCOUNTING POLICIES continued Charitable Expenditure Costs are recognised on an accruals basis in the period in which they are incurred.

Expenditure on raising funds includes the costs incurred in raising donation income and grant income, including apportioned support costs.

Expenditure on charitable activities comprises the costs incurred on charitable activities including apportioned support costs. Where support costs cover more than one area of activity the costs are allocated to each activity based on revenue.

Costs of expenditure on raising funds includes the fees incurred in managing the Charity’s investments.

Operating Leases Annual rentals under operating leases are charged against income on a straight line basis over the lease term.

Stock and Work-in-Progress Raw materials, work-in-progress and finished goods are valued at the lower of cost or estimated selling price less cost to complete and sell. Cost comprises the direct cost of production and the net attributable proportion of works overheads appropriate to each department.

Cost is determined on an average cost method.

Cost includes the purchase price including transport and handling directly attributable to bringing the stock to its present location and condition.

Fixed Assets Tangible assets are stated at cost (or deemed cost) less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price, costs directly attributable to bringing the asset to its working condition for its intended use, dismantling and restoration costs.

56

Land is not depreciated. Depreciation on other assets is calculated, using the straight-line method, to allocate the depreciable amount to their residual values over their estimated useful lives, as follows Freehold buildings – 2% straight-line Buildings plant – 7% straight-line Plant, Machinery, Fixtures and Fittings – 15% straight-line Motor vehicles – 25% straight-line

Impairment of debtors The charity makes an estimate of the recoverable value of trade and other debtors.

When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience.

Assets Under Construction Assets under construction represents expenditure incurred in creating assets.

Depreciation takes place only after completion and capitalisation.

Defined benefit pension scheme The charity has an obligation to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including; life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management estimates these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends.

Limitation of Capitalisation Expenditure below £1,000 per item does not qualify for capitalisation as a fixed asset as it is not considered to be material.

Financial Instruments The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.

Financial Risk Management The Charity’s operations expose it to some financial risks that include the effects of changes in market interest rates and its liquidity position. The Charity has in place a risk management programme that seeks to limit adverse effects on the financial performance of the Charity.

(i) Financial assets Basic financial assets, including trade and other receivables, cash and bank balances are initially recognised at transaction price. At the end of each reporting period financial assets are assessed for objective evidence of impairment.

If an asset is impaired the impairment loss is the difference between the carrying amount and the estimated cash flows. The impairment loss is recognised in profit or loss.

Office equipment – 33% straight-line

Critical accounting estimates and assumptions The charity makes estimates and assumptions concerning the future. The resulting accounting estimates will by definition seldom equal actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

2019/2020 ANNUAL ACCOUNTS

Investments which are not subsidiaries are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in fair value reserve.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party. (ii) Financial liabilities Basic financial liabilities include trade and other payables, and loans. They are initially recognised at transaction price.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially and subsequently measured at transaction price as all of them are current.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires. (iii) Offsetting Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised.

The impairment reversal is recognised in profit or loss.

2019/2020 ANNUAL ACCOUNTS

57

2.

INCOME FROM DONATIONS & LEGACIES

5. TOTAL EXPENDITURE FY 19/20

FY 18/19

£000's

£000's

Donations

3,458

4,360

Legacies

69

-

Events

231

120

Shop

43

-

3,801

4,480

3.

EXPENSES BEFORE NET EXPENDITURE FOR THE YEAR FY 19/20

FY 18/19

£000's

£000's

Rentals payable under Operating Leases

210

270

Depreciation (Note 7)

771

723

Auditors remuneration

46

45

Loss on investments

454

( 231 )

1,481

807

4.

INVESTMENT INCOME FY 19/20

FY 18/19

£000's

£000's

Investment dividends

200

215

Interest receivable

3

9

203

224

FY 19/20 Activities undertaken directly

FY 19/20 Support costs

FY 19/20 Total

FY 18/19 Activities undertaken directly

FY 18/19 Support costs

FY 18/19 Total

£000s

£000s

£000s

£000s

£000s

£000s

Raising Funds

1,029

85

1,114

672

179

851

Employment Solutions

4,401

566

4,967

4,614

523

5,137

Britain's Bravest Manufacturing

6,637

850

7,487

7,836

920

8,756

RBLI Living

5,043

624

5,667

5,147

528

5,675

17,110

2,125

19,235

18,269

2,150

20,419

Support Costs are detailed in the schedule below. The comparative analysis for the prior year has been reclassified so that the allocation of support costs is on the same basis as the current year.

Auditors’ remuneration was £46,035 (FY 18/19 : £45,000). In addition other advice was provided by BDO relating to taxation services £ 3,111 (FY 18/19 : £3,690) Operating lease payments included in Resources Expended totalled £175,255 (FY 18/19 : £298,723).

The loss on disposal of fixed assets was £402 (FY 18/19 : £5,723)

SUPPORT COSTS FY 19/20

Employment Solutions

Britain’s Bravest M’facturing

RBLI Living

Fundraising

FY 19/20 Total

£000s

£000s

£000s

£000s

£000s

Executive

70

106

77

10

263

Finance

158

238

174

24

594

Business Systems

107

160

118

16

401

Human Resources

101

151

111

15

378

Marketing

65

98

72

10

245

Other Costs

32

48

36

5

121

Pension Deficit

33

49

36

5

123

566

850

624

85

2,125

Support costs are allocated, where practicable, to the charitable activities on a directly attributable basis. The remainder is apportioned to each activity based on revenue.

SUPPORT COSTS FY 18/19 Comparatives

58

2019/2020 ANNUAL ACCOUNTS

Employment Solutions

Britain’s Bravest M’facturing

RBLI Living

Fundraising

FY 18/19 Total

£000s

£000s

£000s

£000s

£000s

Executive

62

110

63

21

256

Finance

146

256

147

50

599

Business Systems

95

167

95

32

389

Human Resources

89

157

90

31

367

Marketing

56

98

56

19

229

Other Costs

25

44

26

9

104

Pension Deficit

50

88

51

17

206

523

920

528

179

2,150

2019/2020 ANNUAL ACCOUNTS

59

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

6. DIRECTORS, EMPLOYEES AND VOLUNTEERS THE AVERAGE MONTHLY NUMBER OF PERSONS

FY 19/20

FY 19/20

FY 18/19

FY 18/19

EMPLOYED BY THE COMPANY DURING THE YEAR WAS:

Number

FTE

Number

FTE

85

79

93

87

162

108

144

100

All the 12 employees (FY 18/19 : 10) earning over £60,000 p.a. participated in the company pension scheme, and pension contributions of £ 83,954 were made by RBLI in the year to 31 March 2020. (FY 18/19 : £79,103) The total remuneration of the above 12 key ( FY 18/19 : 10 ) management personnel was £ 1,281,581 (FY 18/19 : £1,119,860). This includes redundancy pay of £ 20,435 (FY 18/19 : £0) No remuneration is paid to the trustees as they act on an honorary basis. Travel expenses were reimbursed to one Trustee (FY 18/19 : 2) and amounted to £ 26 in the year (FY 18/19 : £850).

The Charity is grateful for the large number of volunteers who have helped support the charity over the last 12 months. All areas of the Charity have benefited from this support ranging from admin support, job coaching, care etc.

136

95

142

91

14

13

12

11

Governance costs for the year were £105,863 (FY 18/19: £108,532)

25

22

25

22

422

317

416

311

FY 19/20

FY 18/19

£000s

£000s

8,465

8,195

748

715

717

670

32

31

126

94

172

251

10,260

9,956

Employment Solutions RBLI Living Britain’s Bravest Manufacturing Fundraising and Marketing Executive & Corporate Services

Analysis of Governance Costs:

During the year a total of 826 volunteers (FY 18/19: 584 ) worked for a total of 14,579 hours (FY 18/19: 16,293 hours)

STAFF COSTS

Wages and salaries Social Security costs Other Pension costs Other costs Redundancy / Termination Payments FRS 102 adjustment in SOFA

FY 19/20

FY 18/19

£000's

£000's

Employment Costs

36

36

Audit

46

45

Trustee Expenses

6

15

Overheads

19

13

106

109

7. TANGIBLE ASSETS

COST At 1st April 2019

During the year £49,746 expenditure was incurred on recruitment fees (FY 18/19: £96,816).

Additions

Freehold Land and Buildings

Buildings Plant

Plant and Machinery

Fixtures and Fittings

Motor Vehicles

Office Equipment

£000s

£000s

£000s

£000s

£000s

17,684

1,536

1,424

1,570

79

23

32

43

28

Disposals The total number of employees whose emoluments, excluding pension contributions, were in excess of £60,000 per annum fell within the following bands:

Total

£000s

£000s

£000s

391

2,464

25,148

24

2,280

2,430

(4)

(4)

Transfers

2,031

475

At 31st March 2020

19,738

2,043

1,463

2,006

408

31

( 2,945 )

-

79

446

1,799

27,574

79

346

-

8,370

50

-

771

-

(3)

FY 19/20

FY 18/19

ACCUMULATED DEPRECIATION

Number

Number

At 1st April 2019

4,887

1,207

919

932

60,001 - 70,000

4

3

Charge for year

355

106

110

150

70,001 - 80,000

1

1

Disposals

80,001 - 90,000

1

1

90,001 - 100,000

3

1

At 31st March 2020

5,242

1,313

1,026

1,082

79

396

-

9,138

100,001 - 110,000

-

3

110,001 -120,000

1

-

NET BOOK VALUE at 31st March 2020

14,496

730

437

924

-

50

1,799

18,437

120,000 - 130,000

1

-

NET BOOK VALUE at 31st March 2019

12,797

329

505

638

-

45

2,464

16,778

130,001 -140,000

-

1

140,000 - 150,000

1

-

12

10

£

60

Assets Under Construction

2019/2020 ANNUAL ACCOUNTS

(3)

The Trustees believe that the market value of land is significantly higher than the book value, which is negligible as it was transferred to the Charity in 1919, although a professional valuation was not performed.

Assets Under Construction represent capital expenditure on Projects which are not finalised. The largest projects under this section are the work that has started on the Centenary Village (£1.4m) and also the Refurbishment of Gavin Astor House (£282k).

2019/2020 ANNUAL ACCOUNTS

61

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

8. INVESTMENTS At Fair Value Managed Investment Portfolio

FY 19/20

FY 18/19

Listed on UK Stock Exchange

1,039

1,927

UK Fixed Interest

1,248

2,159

Overseas Equities

1,200

1,893

Overseas Fixed Interest

-

-

Alternative Investments

247

524

Cash Reserve

309

565

Fair Value at 31 March 2020/2019

4,044

7,068

Cost of Managed Investments at 31 March

6,483

6,354

FY 19/20

FY 18/19

Analysis of Movements of Investments

£000s

£000s

Valuation at 1 April

7,068

6,834

Realised Gains / (Losses)

201

195

Unrealised (Losses) / Gains

( 714 )

38

Deposits and Withdrawals

57

67

( 2,500 )

-

Less: Management Costs

( 68 )

( 66 )

Valuation at 31 March at 2020/2019

4,044

7,068

£000s

Sales of investments

9.

DEBTORS FY 19/20

FY 18/19

£000s

£000s

Trade debtors

1,479

1,595

Other debtors

8

38

716

736

2,203

2,369

£000s

Prepayments and accrued income

12.

CREDITORS - AMOUNTS FALLING DUE WITHIN ONE YEAR FY 19/20

FY 18/19

£000s

£000s

Trade creditors

570

1,057

Other taxation and social security

467

406

-

53

1,622

1,635

62

49

2,720

3,200

Amounts falling due within one year:

Other creditors Accruals Deferred Income

13.

FINANCE CHARGE

14.

FUND BALANCES CARRIED FORWARD AT 31ST MARCH

A charge over the Churchill Centre and the factory buildings at Aylesford has been granted to The Royal British Legion Pension Fund Trustees as security for the pension deficit liability and to support the Employers Covenant.

FY 19/20 Unrestricted Funds

FY 19/20 Restricted Funds

FY 19/20 Total Funds

FY 18/19 Unrestricted Funds

FY 18/19 Restricted Funds

FY 18/19 Total Funds

Tangible assets

9,981

8,456

18,437

9,629

7,149

16,778

Investments

3,978

66

4,044

6,997

71

7,068

13,959

8,522

22,481

16,626

7,220

23,846

1,525

2,618

4,143

1,100

1,765

2,865

NET ASSETS (excl. pension scheme liability)

15,484

11,140

26,624

17,726

8,985

26,711

Defined benefit pension scheme (liability)

( 2,604 )

-

( 2,604 )

( 1,934 )

-

( 1,934 )

NET ASSETS (inc. pension scheme liability/asset)

12,880

11,140

24,020

15,792

8,985

24,777

INVESTMENT IN SUBSIDIARY

The Company owns 100% of the issued share capital (being 2 shares of £1 each) of RBLI Contracts Ltd, a dormant company.

There has been no income or expenditure in the subsidiary in the year (FY 18/19: none) and there are no capital and reserves at the year end (FY 18/19: none).

10.

11.

STOCKS AND WORK IN PROGRESS FY 19/20

FY 18/19

Raw materials

467

519

Finished goods

14

7

481

526

£000s

£000s

£000s

Net current assets

£000s

£000s

£000s

£000s

£000s

The replacement cost of raw materials does not differ materially from the value stated in the balance sheet.

The cost of raw materials recognised as an expense in the year was £2,731,023 (FY 18/19: £2,764,986)

62

2019/2020 ANNUAL ACCOUNTS

2019/2020 ANNUAL ACCOUNTS

63

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

15.

ANALYSIS OF FUNDS

UNRESTRICTED FUNDS There are five unrestricted funds, two of which are designated: The designated Future Projects and Developments Fund holds reserves of £5m (FY 18/19: £5m) for the development of the RBLI Village.

The designated Operating Cost Reserve provides a reserve covering 4 months of operating cost.

The General Funds reflects the remaining Undesignated Funds used by the charity to provide services and support to beneficiaries.

The Pension Reserve reflects the balance of surplus or deficit on the defined benefit pension scheme and moves in line with annual valuations as per note 16.

The Fair Value Reserve reflects the balance of surplus or deficit on the revaluation of the investments as per note 8.

RESTRICTED FUNDS Capital and Revenue Grants hold restricted grants received for the development of property, plant and equipment and the provision of services to disabled people and Armed Forces veterans.

Balance as at 1st April 2019 £000s

£000s

Expenditure, gains and losses £000s

Balance as at 31st March 2020

4,165

( 1,206 )

( 1,856 )

2,868

71

-

-

(5)

66

Capital Assets

4,619

-

3,736

( 149 )

8,206

Libor MOD Grants

2,530

-

( 2,530 )

-

-

Total Restricted Funds

8,985

4,165

-

( 2,010 )

11,140

1,171

2,247

( 1,152 )

-

2,266

Income

Transfer

£000s

1,765

Investments

Capital and Revenue Grants

Balance as at 1st April 2019 £000s

Income

Expenditure

Gains and losses

£000s

£000s

£000s

Balance as at 31st March 2020 £000s

Future Projects and Developments

5,000

-

-

-

5,000

Operating Cost Reserve

5,000

-

-

-

5,000

10,000

-

-

-

10,000

Scotland

159

192

( 53 )

( 194 )

104

Lifeworks

71

611

-

( 540 )

142

General Fund

7,141

15,313

( 17,106 )

276

5,624

Welfare

73

163

-

( 201 )

35

Pension Reserve

( 1,934 )

( 124 )

( 546 )

( 2,604 )

Vanguard Trust Net Assets

110

-

-

110

-

( 725 )

( 140 )

Designated Funds set aside by the trustees

Fair Value Reserve Total Unrestricted Funds

585 15,792

15,313

( 17,230 )

( 995 )

Analysis of Capital and Revenue Grants Centenary Village

Other

12,880

181

952

(1)

( 921 )

211

1,765

4,165

( 1,206 )

( 1,856 )

2,868

Analysis of Restricted Capitalised Assets Centenary Village

320

-

1,152

-

1,472

Appleton Lodge

72

-

2,530

(9)

2,593

Hermitage Lane Apartments

2,233

-

-

( 71 )

2,162

Vanguard Properties

1,160

-

-

-

1,160

Scotland Factory

112

-

53

(2)

163

Other

722

-

1

( 67 )

656

4,619

-

3,736

( 149 )

8,206

Explanation The £2,530k Libor Grant is contributed to help fund the development of a new 15 bedroom care facility and day care centre.

64

2019/2020 ANNUAL ACCOUNTS

2019/2020 ANNUAL ACCOUNTS

65

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

16.

PENSION SCHEME

Royal British Legion Industries participates in two staff pension funds. The Defined Benefit Scheme (the Fund), and the Group Personal Pension Plan ( the GPPP), both operated in conjunction with The Royal British Legion.

Contributions to the Group Personal Pension Plan in the year were £552,000 (FY 18/19 : £430,000). Contributions are limited to twice the level of the employees’ contribution. There were 336 employees participating in the scheme at 31 March 2020 ( FY 18/19 : 351) The Defined Benefit Scheme was closed to new entrants in 2002. During the year no contributions were made by RBLI (FY 18/19 : £NIL).

£000s

£000s

Assets

Liabilities

Total

At 31 March 2019

13,858

( 15,792 )

( 1,934 )

Benefits paid

( 486 )

486

-

Employer contributions

48

-

Administration expenses

( 125 )

48 ( 125 )

Past service cost

The most recent formal scheme published actuarial valuation was carried out by First Actuarial LLP as at 1 April 2017.

The major financial assumptions used by the actuary for FRS102 purposes were:

Interest income/(expense)

326

( 373 )

( 47 )

-

252

252

Return on plan assets excluding interest income

( 798 )

-

( 798 )

At 31 March 2020

12,823

( 15,427 )

( 2,604 )

remeasurement gains

FY 19/20

FY 18/19

Discount rate (%p.a.)

2.30%

2.40%

Retail Price Inflation (%p.a.)

2.60%

3.20%

Consumer Price Inflation (%p.a.)

2.10%

2.20%

Salary increase rate (%p.a.)

3.10%

3.30%

Post 98 Pension

2.60%

3.10%

17.

Post 98 GMP

1.90%

2.00%

The Company is exempt from liability to corporation tax on its charitable activities due to its status as a registered charity.

Revalutaion of deferred Pensions

2.10%

2.20%

Current pensioners Men

86.9

86.8

Current pensioners Women

89.2

89.0

Future pensioners now aged 45 Men

88.2

88.1

Future pensioners now aged 45 Women

90.6

90.5

FY 19/20

FY 18/19

Fair value of fund assets

£000s

£000s

Equities

3,398

3,783

Bonds

4,346

4,679

-

2,430

The Company had the following future minimum lease payments under non-cancellable operating leases for each of the following periods:

Other Growth Seeking assets

2,414

2,629

Operating leases

Liability Driven Investments

2,281

-

Cash

384

337

Total

12,823

13,858

Actuarial Assumptions

RATE OF INCREASES OF PENSIONS IN PAYMENT

LIFE EXPECTANCY AT AGE 65:

Gilts

In addition, the Trustees hold insured annuity policies. The value of these annuities has been excluded from both the assets and the liabilities since the liability is matched directly by an asset value of equal value. This is consistent with previous disclosures. The Fund does not invest in the sponsor’s own financial instruments, including property or other assets owned by the sponsor.

FY 19/20

FY 18/19

£000s

£000s

125

93

-

118

Net Interest

47

40

Total cost recognised as an expense:

172

251

Total cost recognised as an expense: Administration expenses Past service cost

66

£000s

Reconciliation of scheme assets and liabilities

2019/2020 ANNUAL ACCOUNTS

Actuarial gains

18.

TAXATION

CAPITAL COMMITMENTS

Capital Commitments contracted for at year end but not provided for.

Capital Commitments approved but not contracted

19.

FY 19/20

FY 18/19

£000s

£000s

829

645

10,800

-

OPERATING LEASE COMMITMENTS

FY 19/20

FY 18/19

£000s

£000s

Not later than one year

152

178

Later than one year and not later than five years

185

142

Later than 5 years

21

Total operating leases

358

Payments due

20.

320

RELATED PARTY TRANSACTIONS

No donations were received from organisations connected with trustees. In FY 18/19 a donation of £ 7,383 was received from Kent Community Foundation. Blair Gulland, a trustee of RBLI, was also a trustee of Kent Community Foundation.

2019/2020 ANNUAL ACCOUNTS

67

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

21.

GRANTS AND DONATIONS

Donations and Grants of £5,000 or more, received in either current or prior year, are shown below. These are reported in the Statement of Financial Activites either under Charitable activities or under income from donations.

GRANTS/DONATIONS RECEIVED FROM

68

FY 19/20

GRANTS/DONATIONS RECEIVED FROM (CONTINUED)

FY 18/19

Greenwich Hospital

£ 684,000

£ 40,190

Garfield Weston Foundation

500,000

-

BBO Grant

435,490

664,425

ABF The Soldiers' Charity

368,500

285,500

Barratt Developments

240,963

750,000

Workchoice employee support grant

240,416

259,298

Oak Foundation

200,000

-

The Morrisons Foundation

195,100

-

Sir Jules Thorn Charitable Trust

175,000

-

Colyer Fergusson Charitable Trust

125,500

-

Annington

106,000

100,000

Bernard Sunley Charitable Foundation

50,000

-

Conway Charity

50,000

-

Masonic Charitable Foundation

45,000

-

The Swire Charitable Trust

40,756

61,134

Scottish Veterans Fund

40,600

28,194

Big Lottery

40,000

-

Poppy Scotland

39,717

33,549

Queen Mary's Roehampton Trust

35,000

30,000

Moondance

33,000

-

Annington Trust

25,000

25,000

Officers Association Scotland

25,000

-

The Lawson Trust

25,000

-

Berkeley Foundation

20,000

-

Childwick Trust

20,000

-

John Scott Charitable Trust

20,000

22,500

Veterans Foundation

20,000

29,752

Serco Foundation

19,878

-

Impact Funding

18,000

-

RAF Benevolent Fund

18,000

57,500

Calleva Foundation

15,500

-

Centor

15,000

22,000

Golding Homes

15,000

-

The Army Central Fund

15,000

15,000

Standard Life Aberdeen

13,194

-

Gerald and Gail Ronson Family Foundation

10,000

-

Zochonis Charitable Trust

7,500

-

2019/2020 ANNUAL ACCOUNTS

Michael J Head

FY 19/20 £

6,100

FY 18/19 £

-

Basil Death Trust

6,000

-

Stephen Kingsman

6,000

-

Charles N Villiers

5,000

-

Cobtree Charity Trust

5,000

-

Constance Travis Charitable Trust

5,000

-

Francis Winham Foundation

5,000

-

John James Bristol Foundation

5,000

-

Julian Hodge Foundation

5,000

-

Odger GDW

5,000

-

Reo Stakis Charitable Trust

5,000

-

The Rowlands Trust

5,000

5,000

Edith Lilian Harrison 2000 Foundation

-

5,000

Erskine Hospital

-

350,000

Fidelity UK Foundation

-

75,000

Kent Community Foundation

-

7,383

Kilpatrick Fraser Charitable Trust

-

5,000

Michael Marsh Charitable Trust

-

5,000

MOD acting on behalf of Her Majesty's Treasury

-

700,000

MOD Aged Veterans Fund

-

86,700

MOD Armed Forces Covenant

-

39,992

Next PLC

-

15,000

Postcode Community Trust

-

18,000

Redrow Homes

-

6,909

The Henry Oldfield Trust

-

100,000

Screwfix Foundation

-

5,000

Susan H Guy Charitable Trust

-

10,000

Tesco (Groundwork UK)

-

11,000

The Eveson Charitable Trust

-

8,000

The Graham Trust

-

10,000

The MacRobert Trust

-

40,000

The National Lottery Community Fund (Scotland)

-

40,000

The Royal British Legion

-

17,500

Vanguard Trust

-

1,339,972

Wo Street Charitable Foundation

-

5,000

3i

-

25,000

4,010,214

5,354,498

2019/2020 ANNUAL ACCOUNTS

69

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

22. NET CASH (OUTFLOW)/INFLOW FROM OPERATING ACTIVITIES FY 19/20

FY 18/19

( 211 )

2,155

Losses/(Gains) on investment assets

457

( 300 )

Investment management fees deducted from fund

68

66

Difference between pension charge and cash contributions

124

206

( 203 )

( 224 )

Depreciation on tangible fixed assets

771

723

Loss on disposal of fixed assets

(0)

6

(Increase) in stocks

45

( 144 )

Decrease/(Increase) in debtors

166

2

(Decrease)/Increase in creditors

( 480 )

( 29 )

737

2,461

FY 19/20 £000s

FY 18/19 £000s

£000s

Net (expense) / income

Investment income

Net cash (outflow) / inflow from operating activities

£000s

23. FINANCIAL INSTRUMENTS Note Financial assets Financial assets measured at amortised costs Trade debtors

9

1,479

1,595

Others debtors

9

8

38

1,487

1,633

4,180

3,170

Cash at bank and in hand Financial liabilities measured at amortised costs Trade creditors

10

570

1,057

Other creditors

10

-

53

570

1,110

Net cash (outflow) / inflow from operating activities

70

2019/2020 ANNUAL ACCOUNTS

2019/2020 ANNUAL ACCOUNTS

71

LEGAL & ADMINISTRATIVE INFORMATION TRUSTEES Mr S W Kingsman DL Chairman Mr F Martin DL Vice Chairman Brigadier H H Kerr OBE Mr A Watson Mrs N Ahmed OBE DL Mr A B Gulland Kathryn Cearns OBE FCA FCCA Mr D Montgomery (Resigned 16th September 2019) Mr D Crampton DL (Resigned 12th December 2019) Ms S Mason Mr S Rowbotham (Co-opted 18th December 2019)

72

SENIOR OFFICERS

HEAD OFFICE AND REGISTERED Mr S F Sherry CMG, OBE OFFICE Chief Executive

Royal British Legion Industries Mr P Defraine ACMA Limited Director of Corporate Services & Hall Road Co. Secretary Aylesford

ME20 7NL Mr G Streetley Director of Britain’s Bravest TEL: 01622 795900 Manufacturing Company FAX: 01622 882195 (Retired 28th June 2019)

Company Number: 00158479 Mr W Campbell Wroe Incorporated in England and Wales Director of Living

Registered Charity Number Mrs L Farmer England & Wales: 210063 Director of Strategic Development The charity is a public benefit entity

Miss Michelle Ferguson Director of Scotland’s Bravest Registered Charity Number Manufacturing Company Scotland: SC048795

Mr A Milton Director of Employment Solutions (Resigned 31st January 2020)

Ms K Wickes Bull Director of Britains Bravest Manufacturing Company (Appointed 20th May 2019)

2019/2020 ANNUAL ACCOUNTS

INDEPENDENT AUDITORS BDO 55 Baker Street London W1U 7EU

BANKERS

Barclays Bank Plc Corporate Banking Kent Team, 2nd Floor, 30 Tower View Kings Hill West Malling ME19 4UY

INVESTMENT ADVISORS Julius Baer Portfolio Managers Ltd 1 St Martin’s Le Grand London EC1A 1HQ

SOLICITORS

Thomson Snell & Passmore LLP 3 Lonsdale Gardens Tunbridge Wells TN1 1NX Brachers LLP 59 London Road Maidstone ME16 8JH

2019/2020 ANNUAL ACCOUNTS

73

Contact us Royal British Legion Industries Hall Road

Aylesford ME20 7NL

Keep in touch rbli.co.uk rbli.shop wearelifeworks.org.uk

01622 795900

britainsbravestmanufacturing.org.uk

rbli.co.uk

Royal British Legion Industries

marketing@rbli.co.uk

scotlandsbravest.org.uk @RBLI

FUNDRAISING FOR US Contact fundraising@rbli.co.uk Mon to Fri 9am-5:30pm VOLUNTEER FOR US Contact volunteer@rbli.co.uk Mon to Fri 9am-5:30pm

PARTNER WITH US Contact fundraising@rbli.co.uk Mon to Fri 9am-5:30pm

BECOME A FRIEND OF RBLI Contact enquiries@rbli.co.uk Mon to Fri 9am-5:30pm

Registered charity number 210063

Royal British Legion Industries Royal British Legion Industries