Trent & Dove Housing Ltd, Annual Report & Accounts for Year Ended 31st March 2018

Trent & Dove Housing Ltd Annual Report & Accounts for year ended 31 March 2018

Transforming Homes, Lives & Neighbourhoods

Registered Society under the Co-operative and Community Benefit Societies Act Number 30668R Registered by the Home & Communities Agency L4311

Contents

Section

2 | Contents

Page

1

Board Biographies

2

Overview Trent & Dove

3

Report of the Chair

6-10

4

Report from the Chief Executive

11-15

5

Report of the Board

16-24

6

25-28

7

Report of the Audit & Risk Assurance Committee Report of the Governance Committee

8

Report of the Operations Committee

31-32

9

Performance Overview 2017/18

33-41

10

Report of Independent Auditors

42-44

Notes to the Financial Statements

45-78

3-4 5

29-30

1. Board Biographies Overview of Trent & Dove Board members who served in the financial year ending 31st March 2018

Mark Lewis - Chair As well as being our Chair, Mark is also Chair of Action for Kids, a national children’s charity that provides services for young people with physical and learning disabilities. In addition, Mark is the Chief Financial Officer of the Fair Banking Foundation, a charity dedicated to encouraging and helping banking institutions to improve the financial well-being of their customers. Mark is a fully-qualified finance professional with over 30 years’ experience of working within Financial Services, mainly with major international banks, including 10 years in Finance Director/commercial director roles.

Ian Cox - Vice Chair and Chair of Governance Committee Ian has broad cross-sector experience. He has 35 years’ experience at a senior level, having most recently been a main Board Director of a regional construction company. Ian has been involved in the initiation and construction of around 5,000 affordable housing dwellings during his career. His career began in Housing Management at Birmingham City Council, moving on to work for various RPs. Ian has also held voluntary Director roles, such as Birmingham Institute for the Deaf (BID Services) from 1996-2004.

Gary Middleton - Senior Non-Executive Director and member of the Audit and Risk Assurance Committee Gary is an economics graduate, holds a masters degree in Business Administration and is a Fellow of the Chartered Institute of Bankers. Gary has held a number of senior leadership roles in the banking sector and has significant experience of real estate finance, restructuring, asset management and recovery. Gary is passionate about the provision of quality, affordable housing and the key role that housing associations have in delivering this.

Afzal Ismail- Non-Executive Director and Chair of Audit and Risk Assurance Committee Afzal is an Executive Director for a large national housing group. He graduated with an honours degree in Mathematics and is a qualified accountant (fellow ACCA). Afzal is also a member of the Institute of Internal Auditors. He is regularly invited to speak at national conferences on governance and risk management topics, and has extensive previous experience of board membership and of chairing audit committees.

Sally Gibson- Non-Executive Director and Chair of Operations Committee Sally is a Senior Registered Nurse at the Derby Royal Hospital and volunteers in a leadership post at groups associated with Scouting.

Mark Ashby-

Non-Executive Director and Vice Chair of Operations Committee

Mark has worked for over 10 years providing care and teaching support for students with a range of learning or speech and hearing difficulties. He also has several years experience working within the prison service.

Trent & Dove Annual Report and Accounts 2017/18 | 3

1. Board Biographies Sophie Churchill - Non-Executive Director and member of the Governance Committee Sophie began her career in urban regeneration and was then appointed Chief Executive of The National Forest, which covers 200 square miles of the Midlands where mining had left areas in need of sustainable regeneration.

Sophie is also the Chair of TREE AID which uses trees and good silviculture to achieve transformations of livelihoods in the driest parts of Africa. Her book 'The Art of the Chief Executive' was published recently and Sophie enjoys mentoring leaders at all stages of their careers.

Sophie is the first woman President of the Royal Forestry Society. She is a carer, with a PhD based on the lives of adults with learning disabilities. In 2011, Sophie was awarded an OBE for services to the environment and was made an Honorary Fellow of the Institute of Chartered Foresters in 2012.

Kathryn Robb- Non-Executive Director and member of the Audit and Risk Assurance Committee A senior housing professional with 30 years experience ranging from front line service delivery to strategic development and leadership, she holds a post graduate in Housing Studies and is a Corporate Member of Chartered Institute of Housing.

Kathryn has extensive experience in securing new business opportunities and funding bids, merger and stock transfer negotiations and establishing effective multi-agency partnerships.

Ursula Bennion - Chief Executive Ursula has extensive sector experience, spanning a 25 year career in Housing.

Ursula has worked across the sector in a wide variety of roles ranging from her first job as a trainee Housing Officer to Director of Business Development and now as Chief Executive.

During this time, she has worked with both traditional housing associations and also LSVTs which has provided her with a wealth of experience in dealing with the challenges and opportunities facing the affordable housing sector.

Ursula has a clear focus on delivery of excellent services and homes and is looking to expand Trent & Dove’s role as a Placeshaper in our region. Ursula is passionate about working in partnership with our customers and stakeholders. Ursula also supports the Board of Directors to ensure that the organisation has clear, stategic direction and stong leadership.

Geoff Prior - Co-optee and member of the Audit and Risk Assurance Committee We currently have one Co-optee who joined the Board on 1 April 2017.

Geoff has over 35 years of experience within the housing sector working for Gentoo, Thirteen Group and Northampton Partnership Homes.

Geoff brings extensive experience of operating at Director level across all asset management functions.

4 | Board Biographies

2. Overview of Trent & Dove Trent & Dove Housing Limited (T&D) is an Exempt Charity and a non-profit Registered Provider of Social Housing, incorporated under the Co-operative and Community Benefit Societies Act 2014. It is governed by the Board, which includes tenants and independent Non-Executive Directors (NEDs).

T&D’s principal activities are the management and development of social housing following a large-scale voluntary transfer of properties from East Staffordshire Borough Council in March 2001. T&D currently owns 5980 homes, providing customers with properties for rent or shared ownership as well as a range of ancillary support services aimed at helping customers access new skills, training or employment.

T&D has one subsidiary, First Housing Limited, which it acquired in 2009 and whose principal activities are the management of 21 commercial shop units. More details about First Housing and its activities can be found in the First Housing Limited Annual Report and Financial Statements for the year ended 31 March 2018, a copy of which is available on the T&D website.

Figure 1

The Management Team Executive Directors Chief Executive

Ursula Bennion

Finance Director

David Hill Resigned 19/01/18

People & Performance Director Operations Director

Tracy Pepper

Development Director

Charlie Riley appointed 09/10/17

Company Secretary

Russell Davis Resigned 01/07/17

Catherine Slater Appointed 03/07/17

Registered Office

Horninglow Street Burton upon Trent Staffordshire DE14 1BL

Principal Solicitors

Anthony Collins 134 Edmund Street Birmingham B3 2ES

Auditors

KPMG LLP One Snow Hill Snow Hill Queensway Birmingham B4 6GH

Funders and Principal Banker

Lloyds Bank plc PO Box 908 125 Colmore Row Birmingham B3 2DS

Jan Griffiths Appointed 01/05/18

Stephen Grocock Resigned 05/05/17

General Information

During the year the Finance Director resigned his post and was replaced by Jan Griffiths. Jan has over 20 years’ experience in the sector and joins T&D from Housing Plus. On the resignation of Operations Director, Steve Grocock, and following a period of extensive search for the ‘right’ candidate, the Chief Executive and Board have re-considered the Executive structure and are moving to a Director of Property, currently under recruitment, and Director of Housing. The Director of Housing post is currently being covered by Assistant Director, Rachel Chudley.

There were no changes to the Board in 2017/18.

Trent & Dove Annual Report and Accounts 2017/18 | 5

3. Report of the Chair

“Seventeen years’ ago, Trent & Dove made a commitment to our customers, and the communities we serve, to Transform Homes, Lives & Neighbourhoods.

This strategic commitment remains as strong today as it ever was, and is underpinned by a sustained and committed focus to achieving great results, whilst adhering to the highest standards of governance and ethical behaviour in leadership and in every decision the Board makes.�

Mark Lewis, Chair

6 | Report of the Chair

3. Report of the Chair Overview of 2017/18 Whilst the sector continues to face considerable challenges and increasing demands, we at T&D are focusing on the things we believe are important to you, our customers, ensuring that our service delivery is right, that we offer value for money (VFM), that our governance structures support our core purpose whilst delivering our strategic and financial objectives.

The external environment has been unsettled with the horrors of Grenfell and the stark reminder of our role as registered providers in safety and compliance, the new demands of the Homelessness Act and new Value for Money (VFM) standards to embed. I and the Board welcome, however, the clarity around rent increases from 2019 onwards and the confirmation of financial support from the government for growth.

Our Vision & Strategic Plan Our Strategic Plan for 2017 - 2022 has created an exciting vision for T&D and its customers. The Board has committed to this ambitious plan aiming to achieve 10,000 homes by 2022, which meets regional demands and supports the government’s agenda of building more affordable homes.

Summary Mission/Values agreed in 2017 – unchanged for 2018/19 The Executive will continue to review our corporate values and ensure that they meet organisational requirements.

Our Mission:

Transforming Homes, Lives and Neighbourhoods

‘We are driven to make a difference to people’s lives and reduce homelessness in our region’

Overall measure: ‘Trent & Dove neighbourhoods - a great place to live’

Our Identity and operating area:

Regional Place Shaper

Our reach: East Staffordshire; South Derbyshire; North West Leicestershire

‘We can reach all our customers within 1 hour from our base in Burton’

Our Values :

Value

Definition

Overall measure



Passion



“Trent & Dove a great place to work”

 

Integrity Excellence

 



Local/regional focus People and partnerships







Persistent enthusiasm Being authentic Being the best we can Dedicated to our communities Being human in our relationships

Trent & Dove Annual Report and Accounts 2017/18 | 7

3. Report of the Chair Our vision and strategy at T&D is to Transform Homes, Lives and Neighbourhoods by delivering on our 4 Strategic Objectives for 2018/19:   

Growth - increasing the number of homes in our region High Standards - investing in our existing homes and ensuring we remain compliant Sustainability & Great Place to Work - including financial modelling against a challenging external



backdrop; organisation wide business improvement; VFM and a sustainable workforce - skilled and motivated Investment in the Community - including measuring VFM and the impact of this work.

The Board has focused in 2017/18 on the balance of all 4 objectives delivered by a team that believe in a one T&D ethos. The Board firmly believes that this ethos must be lived and breathed throughout the entire organisation, with all members of the Board working alongside the Executive to be role models for the values and behaviours that we helped to shape.

To enable the Board to understand the sector, its challenges and consider ideas and innovation for the long-term, we met 3 times in the year to ‘horizon scan’ and to hear best practice and take feedback from the Executive on how implementation of the Strategic plan is going. These days are in addition to more formal Board meetings and considered extremely valuable in ensuring that the Board achieve the very best they can for customers and stakeholders.

Our CEO, Ursula Bennion, regularly reports progress against the 2017/18 plan and objectives.

Stakeholders During 2017/18 the Board have continued to listen to and strengthen our relationships with stakeholders including: 1 2 3

Customers - through improved quality and maintenance of their homes and strengthened communication and tenant engagement Local authorities and developers - together increasing our number of homes by 179, and many more in the pipeline for 2018/19 Our regulator - we have ensured our regulator is kept abreast of T&D plans and ensured that we commit time to sector groups and bodies.

Board Effectiveness During 2016/17, the Board reviewed its effectiveness and recruited 3 new Non-Executive Directors, reflecting the skills required to deliver our 2017 - 2022 strategy and targets. This year has seen those new Board members settle into their role with Sophie Churchill taking Chair of the Governance Committee; Kathryn Robb joining our Audit & Risk Committee and Geoff Prior supporting the development of our Asset Strategy.

There have been no further appointments this year.

During 2018/19, we will be carrying out an external facilitated review of our effectiveness and I welcome any feedback that brings.

8 | Report of the Chair

3. Report of the Chair

Getting involved: The board has visited some of the association’s housing stock as well as community projects in 2017/18.

It has held a stakeholder event at Tutbury Castle, sharing plans for the future and reinforcing partnership working as a strong Trent & Dove ethos.

Trent & Dove Annual Report and Accounts 2017/18 | 9

3. Report of the Chair The Board has been visible and met with colleagues at T&D on a regular basis through lunchtime informal meetings, and more formal business plan briefings. During 2017/18, a formal review of colleague terms and conditions resulted in the introduction of a new health care scheme for all colleagues at T&D, something championed by Board members.

Governance & Assurance During 2017/18, the Board have driven a new accessible risk framework that clearly lays out the challenges the organisation faces both strategically and operationally. Through stress testing and independent audit we are assured that T&D is able to respond to ever changing demands and inherent risk in the sector.

The Board recently approved the securing of a ÂŁ30m investment by THFC to further our growth ambitions and underpin our financial ability to deliver our plan.

Thank you Finally, as Chair I would like to recognise our customer representatives on our Operations Committee, customer panels and volunteers, whose valuable insights and guidance allow us to understand evolving customer needs and to become the best that we can be.

On behalf of the Board, I would like to thank all T&D colleagues and partners for their commitment to delivering our strategic objectives and making a real difference in Transforming Homes Lives and Neighbourhoods.

Mark Lewis, Chair, Trent & Dove

4. Chief Executive’s Report

“We are making real progress in Transforming Homes Lives & Neighbourhoods and I am delighted to be able to report on another strong performance.”

Ursula Bennion, Chief Executive

Trent & Dove Annual Report and Accounts 2017/18 | 11

4. Chief Exectuive’s Report Developing the 2017 - 2022 Strategic Plans In 2017, the Board and Executive Directors of T&D committed to an exciting five year Strategic Plan, continuing the journey of ‘Transforming Homes Lives and Neighbourhoods’ in our region. The plan was written against a backdrop of unprecedented external change and challenges as well as associated risk.

Key notable issues include: Government White Paper “Our broken housing market”; the ongoing 1% rent cuts for the next two years; Brexit and its potential impact on skills shortages; welfare changes; the cost of borrowing; general political uncertainty; Grenfell Tower and its implications and increased regulatory scrutiny. During the year some of that uncertainty has been alleviated, the future of rents has for example been addressed in the short term; however there is still ongoing challenge, which underpins the need to deliver our focussed approach to leading a sustainable organisation into the next five years.

2017/18 Performance v Strategic Plan During 2017 we have developed a strong and robust performance framework predicated on our own model of operation:

Our Mission Our plan reinforced our commitment to our mission of ‘Transforming Homes, Lives and Neighbourhoods’.

The Board are committed to our strong regional focus, building the right homes in the right places to meet regional demand and our commitment to rental and shared ownership.

Our plan clearly states we are driven to make a difference to people’s lives and reduce homelessness in this region.

Our aspiration to be an organisation of over 10,000 homes by 2022 is reflected in our key drivers of growth and meeting demand in our region, increasing revenues that underpin long-term financial sustainability, and building the organisational strength necessary to work with partners to deliver value for our customers and stakeholders.

Core Objectives   

Growth - increasing further the number of homes in our region High Standards - investing in our existing homes and ensuring we remain compliant Sustainability & Great Place to Work - including its financial model in a challenging external



context; organisation wide business improvement; VFM and a sustainable workforce - skilled and motivated Investment in the Community - including measuring VFM and impact of this area of work.

Transforming Homes 2017/18 Growth - Development In 2017/18 we built 179 Homes, 13 more than planned. In year, we stated our intention to reduce the number of traditional Section 106 developments and shift towards securing new homes from land and build schemes in our existing areas of East Staffordshire, South Derbyshire and North West Leicestershire, where we have influence over what we build and for whom.

We sold 23 Shared ownership properties, enabling customers to access the home ownership ladder and generating £1.2m (£290k ahead of plan) of income.

During 2017/18 we built a strong pipeline of potential developments ensuring that 2018/19 makes a strong start toward our objective of 10,000 homes by 2022. During 2017/2018 we secured £30m of additional funding with THFC to enable our long-term build aspirations to materialise.

12 | Chief Executive’s Report

4. Chief Exectuive’s Report

Trent & Dove Annual Report and Accounts 2017/18 | 13

4. Chief Exectuive’s Report Delivering Outstanding Service - Maintaining our existing Homes In year, we increased our investment spend by £1.2m as a strong financial performance indicated affordability. With this additional funding we replaced additional roofs, kitchens and bathrooms.

We are driving a strong compliance programme, which will ensure our homes continue to be safe with monthly, quarterly and annual compliance reports on FLEGAL a good example.

In 2017, we identified a need to refresh our data around stock condition and during 2018/19 we will be carrying out a significant stock condition survey to refresh and inform our Asset Strategy.

In 2016, our repairs service was brought in–house, and during 2017/18 I am delighted to report that it generated efficiencies whilst also achieving a 99.7% satisfaction rating amongst customers reporting a repair (see VFM section).

Transforming Lives - Investment in the community In line with our mission, we committed to continuing and increasing investment in our community and support programmes by investing 2% of revenue by 2022. In year, we invested 1.39%, around £400k in support programs including 92 people utilising our dedicated mental health support; supporting 47 people into sustained employment and offered 8 dedicated volunteering opportunities. We also supported our partner, Burton Albion Community Trust, both with sponsorship and colleagues providing their expertise to train and guide young people in aspects of work.

Transforming Neighbourhoods We are committed to the number and opportunities for people to volunteer with T&D by getting involved in projects which ensure our customers live in a clean, safe and pleasant environment, and to help more people in our region into work through our employability support. In 2017/18, over 8000 volunteering hours were provided by eight volunteers across a range of projects, including grounds maintenance, community gardens and our community cafes (see ‘You & Us’ our 2017/2018 Community report).

In November, we celebrated our annual community awards, bringing together key community projects that deliver real benefits to people in our region.

The winners this year included:         

Impact on Young People by an Individual (sponsored by Seddon Construction) - Linda Clarke Impact on Young People by an Organisation (sponsored by RPS) - The Family Nurse Partnership Impact on Older People (sponsored by Kensa Heat Pumps) - Sharon Taylor Support Organisation (sponsored by Novus) - Harvey Girls/Dads4Dads Outstanding Achievement in Self Development (sponsored by CDP) - Sajid Rashid Local Hero (sponsored by Matthews & Tannert) - Tom Foster Community Project (sponsored by Burton Albion Community Trust) - Short Street Café Tenant/Volunteer of the Year (sponsored by Idverde) - Tracy Elson Overall Impact on the Community by an Individual (sponsored by Maplevale Developments, RJK Construction) - Kim Smith

14 | Chief Executive’s Report

4. Chief Exectuive’s Report Our People & Great Place to Work There have been changes around Executive leadership of T&D with Jan Griffiths recently joining as Finance Director.

During 2017/18, our People and Performance Director developed and delivered a five year People Strategy which the Board approved, setting out key strategic people projects to support our growth.

These include a culture drive toward ‘one T&D’; improving communications across the organisation; a review of terms and conditions; a new leadership program and a new Skills Academy to support the shortages amongst trades.

Despite the challenges of our restructure, 2017/18 saw 93% of our colleagues agree or moderately agree that T&D is a great place to work. We have delivered a significant training programme, which included a strong focus on coaching and performance along with project management skills and mandatory training to meet our legal and statutory duties.

In 2017/18, we once again secured RoSPA Gold (for the tenth consecutive year) underpinning our commitment to Health & Safety. We had zero Reporting of Injuries, Diseases and Dangerous Occurrences (RIDDOR) incidents and continue to focus on compliance.

Sustainability & Great Place to Work I am delighted to report that the organisation out performed its financial targets during 2017/2018 (see section 7).

With a group operating margin of 31.4% (2016/17 31.0%) and surpluses of £6,530k (2016/17 £6,103k) we continue to benchmark against the data obtained from the global accounts. The results of this benchmarking are contained within the VFM section.

During 2017/18, we underwent a major operational restructure to ensure we are ‘fit for purpose’ to face the challenges of Universal Credit and also reduce operating costs and enable VFM savings.

During 2017, we also secured over £1m of efficiencies, which relate to savings in our repairs service costs, reduced estate management and antisocial behaviour (ASB) legal spend, reduced consultant spend and internal delivery of major void repairs amongst other things.

For 2018/19, we have adopted and are reporting on the new sector scorecard measures including the new VFM standard.

Summary We started the year with a clear plan and I am pleased to be able to provide a positive summary of performance. Whilst we still continue to strive for best practice in areas such as voids, we are making strong inroads to the five year targets. There has been a 2018/19 update to our plans with updated targets and this can be found on our website www.trentanddove.org.

I would like to thank all of our customers, partners, stakeholders and colleagues. As we say in our plan, the ‘&’ in Trent & Dove is very important to us, it signifies the additional services we provide across our communities. We welcome your support, feedback and ongoing challenge to ensure the organisation continues to ‘Transform Homes, Lives & Neighbourhoods’.

Ursula Bennion CEO Trent & Dove Annual Report and Accounts 2017/18 | 15

5. Report of the Board Role of the Board The Board is responsible for the long-term stewardship of the organisation, and for directing and overseeing its activities to make sure that homes and services are provided which meet the needs of our customers now, and into the future. To achieve this, the Board recognises its wider duty to care for the interests of customers, colleagues and stakeholders by maintaining a strong focus on governance and risk management in all decisions it makes and firmly embedding these principles as part of our organisational culture.

In June 2018, the Board reviewed our Statement of Strategy and reaffirmed our purpose, vision and values as an organisation whose focus remains on transforming homes, lives and neighbourhoods. More information about our strategic approach can be found in sections 3 and 4 in the Reports of the Chair and Chief Executive.

For the Board, strategy means the development of specific and measurable actions aimed at promoting the long-term sustainable growth of the organisation, whilst meeting the needs of our customers and communities. Our strategy guides the decision making of the Board, sets the operational direction for Executives and senior leaders and focuses the activities of colleagues when delivering central or front line services.

The Board is responsible for making sure that the organisation has strong and effective leadership, and that those leaders have the right resources in place to achieve our strategic objectives, whilst maintaining a sustained focus on VFM. The Board monitors that the organisation is functioning as it should by challenging and testing the execution of strategy and the performance of approved plans, budgets and controls. It continually identifies and monitors organisational activities for any risks that may impact our performance or stakeholder commitments, and makes sure that frameworks for internal delegation and control, including financial control, are established and monitored so that risks can be controlled and mitigated.

The Board discharges some of its responsibilities directly, and others through its Board committees, Executives and senior management. The Terms of Reference of the Board and its committees is a document which supports and underpins our Governance Framework. It sets out which decisions the Board reserves for its own, and which it delegates to its committees and to senior leaders. The Board receives reports from Board committees on their activities and from the Chief Executive and Executive Directors, explaining how and when their delegated authorities have been used.

Board Structure and Composition T&D’s Board and committee structure is shown below in Figure 2. Reports from the chairs of each Board Committee can be found on pages 25, 29 and 31 and set out the activities achieved by each committee during the course of the financial year in pursuit of its Terms of Reference.

Figure 2

Board of Trent & Dove Housing Ltd

Audit & Risk Assurance Committee

Governance Committee

Operations Committee

Tenant Scrutany Forum (Advisory group, not part of formal governance structure)

16 | Report of the Board

5. Report of the Board The Board currently has nine members - one executive member (our Chief Executive) and eight non-executive members (NEDs). The Board is further assisted by a Co-optee and the Company Secretary.

All members of our Board, Executive and Non-Executive, make decisions by working together and achieving a general consensus. More details about the size, composition and experience of the Board and its members can be found in Section 1, Board Biographies.

Figure 3

Although Executive Directors participate at Board meetings to present reports and debate and understand opinion from Board members on key decision items, their main responsibility is the execution of the Board’s decisions on strategy, capital expenditure and business priorities.

Our Board in numbers: The Board has three supporting committees: Audit & Risk Non-Executive Directors 8 Assurance; Governance and Operations who each execute Executive Directors 1 activities and functions which have been delegated to them by Women 4 the Board. All committees have clear terms of reference and Men 5 their remit for decision making and approvals is set and Ethnic Minorities 1 monitored by the Board. The Board have also established a Board members over 55 6 customer working group, The Tenant Scrutiny Forum, which is Board members under 55 3 not part of our formal governance structure but has strong links to the Board and plays an important role in scrutinising service delivery and performance. More information about the membership and work of each of committees can be found in the Report of the Board Committees.

89% 11% 44% 56% 11% 67% 33% our Board

All of our NED’s are independent in nature, character and judgment. The longest serving member of our Board, who is also Chair of the Board’s Operations Committee, has been with us for approximately 6 years and is due to retire in September 2019. Work will be undertaken by the Board’s Governance Committee during 2018/19 to identify and appoint a suitable Board successor and effect an appropriate transition in the Chairship of the Operations Committee. More information about how we plan to do this can be found in the Report of the Governance Committee.

During the 2017/18 financial year there have been no Board member retirements and no new Board members have been appointed.

The Role of our Board Members Our Board members are recruited for their broad skills and experience, and for the value and insight they can bring as a result of their leadership and operational experience in their respective fields. More information about each of our Board members’ backgrounds and expertise can be found in the Board Biographies section, starting on page 3.

All NEDs are appointed for an initial term of three years. Reappointment following the initial term is not automatic and NEDs are required to satisfy continuing independence and performance related criteria before they are appointed for a second, three year term. Any term beyond six years is subject to rigorous annual review, which takes into account the need to progressively refresh the Board.

All the members of our Board are expected to contribute a culture of clear and open debate, so that informed and prudent decision making can take place. The Board monitors the performance of leaders and the business via bi-monthly Key Performance Indicators (KPI’s) and progress monitoring, and constructively challenges performance where this is appropriate.

All Board members are expected to continuously develop and update their knowledge, skills and experience so that they can continue to make informed and positive challenges and contributions to Board discussions. T&D supports this by offering access to independent professional advice and by encouraging Board members to participate and attend conferences, training days, workshops, Strategy Days and on site ‘back to shop floor’ meetings with operational teams.

Trent & Dove Annual Report and Accounts 2017/18 | 17

5. Report of the Board Time Commitment and NEDs - Other significant commitments The time commitment required from NEDs is currently between 16 and 20 days per year. This includes attendance at Board and committee meetings, preparation for meetings and participation in Strategy Days.

Figure 4 shows each Board member’s attendance at Board meetings during the financial year.

Figure 4 Meeting Attendances* Board Mark Lewis Ian Cox Gary Middleton Afzal Ismail Sophie Churchill Sally Gibson Mark Ashby Kathryn Robb Ursula Bennion Geoff Prior (Co-Optee)

5 out of 5 4 out of 5 4 out of 5 2 out of 5 5 out of 5 5 out of 5 5 out of 5 5 out of 5 5 out of 5 5 out of 5

Board Away Days 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2 2 out of 2

Audit & Risk Assurance

Governance

Operations

4 out of 4 2 out of 4 4 out of 4 1 out of 2 3 out of 4 4 out of 4

4 out of 4 3 out of 4

2 out of 2 2 out of 2

*Meeting attendances reflect the number of Board meetings (excluding Strategy Days) attended by the Board member out of the total number of meetings the Board member was eligible to attend.

The other significant commitments of the Chair and NEDs were disclosed to the Board before their appointment and are summarised in the Board Biographies section. There were no occasions during the financial year where the Board considered that the Chair’s or a NED’s external commitments interfered with, or impeded their ability to exercise their duties and responsibilities effectively. Conflicts of Interest are noted at the start of each Board meeting and are actively managed by the Board and Company Secretary, with Board members abstaining from discussions or decision making where an actual or perceived conflict may exist.

The Board meet seven times a year, including two Strategy Away Days. Each Board committee meets as many times as is necessary to discharge the duties and responsibilities they have under their Terms of Reference. Each Board meeting has a planned agenda, which allows enough time to discuss key areas such as strategy and risk management. Meetings usually include a themed workshop or strategy presentation from colleagues, and this helps to continually improve the operational knowledge of the Board, providing the information and context they need to inform their decision making. Input from professional experts and/or an external advisor is also sought by the Board when necessary, and helps to supplement their knowledge of technical, legal, audit or accountancy matters.

Statement of Compliance with the HCA Regulatory Standards All Registered Providers (RP’s) of Social Housing must be able to demonstrate that they comply with, and adhere to the outcomes and specific expectations set out by the Regulator in their seven Regulatory Standards. The Regulatory Standards comprise of three Economic Standards (Governance and Financial Viability, Value for Money and Rent Standards) and three Consumer Standards (Tenant Involvement and Empowerment, Home, Tenancy and Neighbourhood and Community Standards).

One of the core Economic Standards is Governance and Financial Viability and RP’s receive regulatory ratings from the Regulator based on their compliance with the requirements of this Standard. The Standard requires RPs to have effective governance arrangements in place that “deliver their aims, objectives and intended outcomes for tenants and potential tenants in an effective, transparent and accountable manner”.

It also requires RPs to “manage their resources effectively, to make sure their viability is maintained whilst ensuring that social housing assets are not put at undue risk.”

18 | Report of the BoardTrent &

5. Report of the Board Each year the Regulator requires RPs to assess their compliance with the Governance and Financial Viability Standard and provide assurance to customers and stakeholders that Homes England’s specific expectations are being complied with. Following our annual review of compliance, the Board are pleased to confirm that during the year ended 31 March 2018, we consider that T&D has complied with all applicable outcomes and specific expectations of the Governance and Financial Viability Standard and its accompanying Code of Practice and with the outcomes and requirements of all the other economic and consumer standards.

Statement of Compliance with our Code of Governance Our adopted code of Governance is the National Housing Federation (NHF) Code of Governance. Each year we review our compliance against the NHF Code in order to ensure we continue to meet the expectations and requirements of Registered Providers in our sector. During the financial year ended 31 March 2018, the Board is satisfied that T&D has complied with all relevant principles and provisions of the NHF Code of Governance.

Governance Effectiveness Review Each year, the Board carries out an annual evaluation of Board, committee and individual director performance and process. Every third year this evaluation is facilitated by an external provider, as recommended by the NHF Code of Governance. This external review enables an independent perspective of Board effectiveness to be obtained for continuous improvement purposes. The last external review was conducted during 2015/16 by Savills, with the next externally facilitated review due during the 2018/19 financial year.

In 2017/18, the Governance Effectiveness Review was conducted internally, by the Company Secretary and specifically focused on:    

Governance structure; Board composition and skills; Board performance and culture; and Board member contributions.

As part of the review, each NED, the Chief Executive and Executive Director completed a detailed questionnaire and held a 1:1 review meeting with the Chair.

The outcome of the 2017/18 review was generally positive; members considered that the Board continues to be effective, with a good level of constructive debate around strategic issues and appropriate challenge of senior leadership and organisational performance. A Governance Action Plan was developed, which focused on:     

Board oversight and decision making – developing forward agendas for each Board and Committee so that Board members had better oversight of which decisions they had to make and when; Managing succession planning more pro-actively - so that any future skills needs/shortages could be anticipated. This will also be a key focus in the 2018/19 externally facilitated effectiveness review; Improving the quality of Board reporting and agenda planning – reviewing both the Board report template and the structure of Board agendas to increase the visibility and focus of Strategic and Risk items; Improving Board ‘visibility’ - increase visibility of Board and committee members, and their roles and contributions to colleagues across the organisation. This was achieved by organising regular ‘meet the Board’ events for colleagues before every Board meeting; Board Development – to build on the current programme of induction and development to continue to support the development of NED skills and knowledge.

Dove Annl Trent & Dove Annual Report and Accounts 2017/18 | 19

5. Report of the Board Figure 5

Risk Management and Internal Control Our approach As an organisation we acknowledge that no activity is free from risk. Our approach to risk management focuses on early identification of key risks and proactive response, so we can reduce the likelihood of uncontrolled risk having a detrimental impact on our business.

In order to pursue opportunity, and deliver our strategic objectives, our organisational approach is to be risk aware, but not risk averse. We seek to identify the threats we face in our operating environment - such as threats to our operating model, future performance, solvency and liquidity - so we can take advantage of the upside and minimise the downside.

Identification of risk

Monitoring and reporting

Our Risk Management Approach

Controll of effectiveness

Assessment and evaluation

Determination of response

We have adopted a robust approach to risk management (Figure 5) which helps us to:      

consistantly deliver high quality services and support to our customers, without delay or disruption; keep our customers, colleagues and partners safe and provide homes and neighbourhoods which are healthy to live in; protect and maintain our assets, adding value where we can; make sure we can meet our obligations to funders and stakeholders and remain financially strong; build and maintain excellent relationships with our partners; provide our colleagues with a great place to work.

During the year we reviewed and strengthened our risk management processes and reporting capabilities so that risk can continue to be appropriately managed. To do this we:

    

reviewed and updated our risk management policy and guidance framework; conducted an in-depth review of our strategic and operational risk registers; worked with the Board, senior leadership team and all functional areas to strengthen risk definition, ownership, assessment, assurance and reporting; continued to roll-out risk management training to the Board and all colleagues; procured a specialist electronic risk management solution to allow for accurate thematic analysis, risk reporting and aggregation.

As with all T&D processes, we regularly review and assess our risk management approach to ensure that it meets business needs, whilst meeting the regulatory expectations and the requirements of the NHF Code of Governance.

20 | Report of the Board

5. Report of the Board How we manage risk Risk management is a ‘business as usual’ activity for our Board, Executive and senior leadership team.

We regularly stress-test our financial and operational plans using risk based scenario testing and review our assurance framework on a quarterly basis in order to continuously improve the strength of our internal controls. We operate a holistic risk management system that is applied throughout the business, as set out in Figure 6.

Figure 6 Board Oversight Identification of risk Mitigation of risk at group level

 Has overall responsibility for the approach to risk management and internal control;  Sets ‘Risk Appetite’ – how much risk our organisation is willing to accept in key areas;  Owns the Strategic Risk Register – a log of our principal risks and uncertainties;  Monitors the nature and extent of our exposure to our principal risks;  Receives assurance from the business that operational risks are being identified and controlled.

Audit & Risk Assurance Committee (ARAC)    

Has oversight of the risk management process; Reviews performance of internal control and assurance framework; Reviews reports from our internal and external auditors; Provides quarterly assurance to the Board that an internal control framework is in place and operating effectively.

Executive Management Team (EMT)  Reviews, and operationally manages, the Board’s Strategic Risk Register;  Tracks, monitors and report on any changes to strategic risks to ARAC;  Receives assurance from SMT that operational risks are being effectively controlled and mitigated.

Senior Management Team (SMT) Identification of risk Assessment of risk Mitigation of risk Reporting

 Champions the risk management framework and operational processes;  Reviews and provides assurance for the operational risks falling under their remit;  Reviews and provides assurance to EMT that the highest operational risks across the business are being effectively controlled and managed.

All leaders and colleagues  Carry out risk identification, assessment and mitigation;  Follow the guidance and approaches set out in the Risk Management Policy and guidance;  Undergo risk management training.

Trent & Dove Annual Report and Accounts 2017/18 | 21

5. Report of the Board Our Risk Management arrangements include: 

Setting an organisational stance in our Risk Management Policy, and giving colleagues guidance and support to understand, identify and manage risk effectively using our Risk Management Framework Guides;



Identifying the level of risk the organisation is willing to accept – our Risk Appetite - before it poses a threat to the delivery of our strategic or operational objectives. The Board sets the Risk Appetite of the organisation and reviews it on an annual basis to make sure it responds to any changes in our strategic objectives, market and sector conditions or in law or regulation;



Having two risk registers which identify the different kinds of risk our organisation faces. Our Strategic Risk Register contains the risks which could prevent us achieving our strategic objectives and our Operational Risk Register sets out how we manage and control the risks to our operational services and processes;



Reviewing any risk that sits outside the Board’s Risk Appetite to decide if this is something we want to carry on doing or if there are any internal controls and processes we could put in place to reduce the extent to which a risk materialises and the impact it could have;  Periodically checking internal controls are in place and working effectively by obtaining assurance from leaders and colleagues who own them.

We use the ‘Three lines of defence’ assurance model, which encourages colleagues to identify both internal and external sources of assurance for each of their risks;  Training our ARAC members, Executive, Senior Management Team and nominated colleagues around the business on risk management practices, so they can be ‘Risk Champions’ for our risk management approach;  Monitoring and reporting on the performance of our risk management framework using risk management KPIs, a Risk Performance DashBoard, internal control breach reporting and by reporting and reviewing strategic and operational risk registers at SMT, EMT, ARAC and the Board;  Stress and scenario-testing the assumptions in our financial plans, particularly for matters which are beyond our operational control, such as interest rate rises, Brexit and Welfare Reform.

Our Principal Risks and Uncertainties The Board’s ongoing review of our principal (or strategic) risks ensures that we are able to reflect on the challenges facing our business and ensure that we remain equipped to meet these challenges by mitigating exposure to risks the organisation cannot adequately predict or control.

During the financial year, the Board reviewed the way we approach the principal risks and uncertainties facing the organisation; separating out our key strategic risks, i.e. those risks which could effect or prevent the delivery of current and long-term strategic objectives, from operational risks, the risks inherent in carrying out our day to day business processes and service activities. This work provided us with a refreshed framework to consider the identification of new risks, evolution of existing risks and evaluation of internal control effectiveness.

22 | Report of the BoardTren

5. Report of the Board The Board consider the principal risks and uncertainties affecting the organisation to be as follows:

Risk Income reduction The potential for a reduction in income as a result of the roll-out of welfare reforms.

Development and new homes supply We fail to deliver our commitment to building and supplying new homes for our customers to rent or buy.

Controls         

Treasury market volatility and availability of finance A tightening of the credit markets leading to increased lending costs and/or a reduction in the number of funders accessible to the sector. Pressures on liquidity from counterparty risk, welfare reform and market movements.

Health and Safety of customers, colleagues and partners Renewed focus in a postGrenfell world to ensuring the safety and wellbeing of all T&D customers and everyone who works with and for us.

Data Management The introduction of the new EU General Data Protection Regulations (GDPR) placing greater emphasis and expectations on organisations regarding how they collect, use, store and share personal data belonging to colleagues, customers and third-parties.

    

Stress-testing the impact of higher arrears, bad debts and income reduction on our financial plan and budgets; Investment in learning and development to provide the right skills for colleagues to support customers facing reduced incomes; Supporting our customers into work, skills development and volunteering.

The development of a five-year Development Plan; A sufficient pipeline of new land led schemes; Constant monitoring by Board, EMT and SMT of Development Plan delivery, including review of KPIs and target outturn reports; Monitoring the external commercial operating environment for example housing market, mortgage availability and government policy; Researching and monitoring construction techniques; Sales products and incentives monitored and reviewed.

Robust treasury management policies and processes in place, which provide for high levels of liquidity in both cash terms and in terms of available property security; Our forecasting processes allow us to plan ahead for a long time horizon; We maintain excellent relationships with funders, valuing their long term commitment to the business Our covenants are comfortably met and robustly stress-tested; We have access to expert treasury advisors who have the right skills and knowledge to support us as we manage our finances.

    

Health & Safety policy and processes; Mandatory training for all leaders and staff in key roles; Annual H&S performance summary; Annual report of H&S performance to Board; EMT scrutiny of all H&S incidents, reporting of H&S OFI’s.



Compliance framework designed to satisfy the requirements of the EU GDPR; Framework reviewed by SMT, EMT, ARAC and Board; Data Protection policies and operational guides reviewed and updated; Data Protection Officer (DPO) trained and accredited with GDPR Practitioner status; Colleague ‘Data Champions’ trained and in place across the organisation; All colleagues receive mandatory data protection training, refreshed biannually; Data Protection spot-checks conducted by Internal Auditor on a 6 monthly basis.

     

Trent & Dove Annual Report and Accounts 2017/18 | 23

5. Report of the Board As well as the risks opposite, to ensure that we are prepared for the challenges ahead, 2018/19 will see us managing the risks around:  

driving forward with our land-led development programme, supported by our in-house Development team; and reviewing our digital offer to customers by integrating our internal ICT systems to enable greater accessibility for customers to our services.

Internal Control The Board’s Audit and Risk Assurance Committee (ARAC) monitors and reviews the effectiveness of the organisation’s internal control framework. It does this on a quarterly basis via review of ‘Quarterly Assurance Returns’ which are compiled and submitted by each Head of Service. Following this review, ARAC provides quarterly assurance to the Board that appropriate internal controls and assurance systems are in place across the business, and that these are operating effectively.

Our internal control framework is designed to:   



effectively and comprehensively manage, rather than eliminate, risk; provide appropriate systems and processes for preventing and/or detecting fraud, financial loss, reputational loss and loss of personal data belonging to customers, colleagues or third-parties; provide appropriate systems to prevent and/or detect the potential for harm to customers, colleagues and stakeholders, including putting appropriate health & safety and safeguarding protocols in place; and to provide reasonable, but not absolute, assurance against material misstatement or loss.

As part of its quarterly review of the internal control framework, ARAC receives assurance around, and considers:      

risk performance and response, including confirmation that operational risk registers have been reviewed by each functional area; reports from internal and external auditors; the performance monitoring framework, including confirmation that KPI performance, customer feedback and complaints has been regularly reviewed; probity incidents, including any actual or suspected cases of fraud, money-laundering or financial impropriety; statutory and regulatory compliance, including the organisation’s compliance with all relevant legal requirements and obligations; and compliance with the organisation’s policy and financial control frameworks.

Business Assurance and External Audit is an important way the ARAC obtains assurance that internal controls are in place and working. At the start of each financial year, our Business Assurance provider and external auditor work with us to put a work plan in place to review and test the controls in our biggest risk areas, or in areas of strategic importance.

During the year, no significant failings or weaknesses were identified by either our Business Assurance provider or external auditor.

24 | Report of the BoardTren

6. The Report of Audit & Risk Assurance Comittee (ARAC)

“ARAC’s core purpose is to scrutinise and review the organisation’s audit and risk management frameworks and processes to make sure that appropriate internal controls are in place and operating effectively. Being able to provide strong assurance on these things to the Board enables the Board to concentrate on its core strategy-setting function” Afzal Ismail, ARAC Chair

Trent & Dove Annual Report and Accounts 2017/18 | 25

6. The Report of ARAC Role and Purpose The Audit and Risk Assurance Committee’s (ARAC) role is an important one; it has responsibility for ensuring the internal and external audit functions are operating effectively and that the organisation has robust and appropriate processes in place for reporting financial performance, and for managing and controlling risks in pursuit of our strategic objectives.

The committee has six members, all of which sit on T&D’s Board or who are tenant members of the Board’s Operations Committee. The inclusion of our tenant members provides independent oversight of our risk and assurance structures. The committee is supported by key colleagues from the organisation’s governance and finance functions and by professional audit and business assurance advisors from KPMG and Mazars. We also have access to financial resources to obtain additional independent professional advice when we feel it is necessary. In this way, we always have access to the most relevant and insightful technical expertise to help us discharge our duties.

During the financial year, the committee met four times to discharge the duties outlined in our terms of reference and member attendance at these meetings is set out in the Report of the Board.

Internal Audit and Business Assurance ARAC are responsible for managing our relationship with our business assurance provider, Mazars, who were appointed in January 2017 for a period of three years to 2020. The Business Assurance service consists of quarterly compliance testing of key internal controls, alongside individually-scoped ‘Significant Risk Reviews’ - in-depth reviews of the internal controls for particular operational processes. The committee is responsible for monitoring and reviewing the effectiveness of the Business Assurance service in the context of the Group’s overall risk management framework, and for ensuring that the Business Assurance provider’s independence is not impaired, taking into account relevant professional and regulatory requirements. Mazars do not provide any other services to T&D, and the committee is satisfied that the key personnel involved in delivering the service demonstrate the appropriate levels of objectivity.

During 2017/18, the committee has commissioned the following in-depth Business Assurance reviews from Mazars in key areas, which had the potential to present a significant risk to us achieving our operational and strategic objectives for the financial year:      

Review of our regulatory register of all organisational assets and liabilities; Review of our risk management framework and processes; Review of our treasury management processes and our compliance with lender covenants; A review of our KPI framework for reviewing operational performance across the organisation; A review of the systems and processes we have in place for managing repairs and maintenance on our property assets; and A review of our governance arrangements around development schemes.

The committee reviews the output reports at each meeting and monitors the recommendations raised to make sure that any proposed remedial actions are reasonable and appropriate and are implemented in a comprehensive and timely manner.

Each year the committee meets with the business assurance provider without management present, to talk through any areas of concern that the committee or provider may have and obtain an objective view of the performance of the internal control framework. This process aids continuous improvement of the committee and the way it operates and also contributes towards the committee’s ability to assess the suitability and independence of the provider.

During the 2017/18 audit year, there have been no recommendations raised by the internal or external audit which represented a significant cause for concern for the committee or the Board.

26 | Report of the Audit and Risk Assurance Comittee

6. The Report of the ARAC Risk Management One of the committee’s key pieces of work during the financial year has been to oversee the implementation of the Board’s Risk Plan. This work has included:  Articulating our organisational stance and approach to risk in a new Risk Management Policy;  Defining and setting our organisational Risk Appetite particularly in areas of highest strategic risk to the business;  Developing our ‘golden rules’ or ‘Risk Tolerances’ for Governance and Financial Viability;  Developed new Risk Management KPIs for inclusion in the Board KPI scorecard and the Risk Performance DashBoard;  Reviewing and updating our Corporate or ‘Strategic’ Risk Register, to identify whether each risk currently sits inside or outside the Board’s Risk Appetite;  Reporting on the strength of our Internal Control Framework by implementing a new Quarterly Assurance Reporting process with input from Heads of Service;  Reviewing and updating the Operational Risk Registers for all teams across the business;  Holding Risk Management training for Board members, Executives and senior leaders;  Started work to procure a suitable electronic Risk Management software solution, which will enable teams to access and update their risk registers quickly and easily.

Our risk reporting cycle remains the same - with risk remaining a high priority on all Senior Management Team agendas, leaders providing quarterly assurance that risk controls are being regularly reviewed and the risk register going to each meeting of the Executive and Board.

As a result of the work undertaken during the course of the year, the committee considers that risk is being assessed thoroughly and is being acknowledged and mitigated effectively at all levels in the organisation.

The Report of the Board, starting on page 16, sets out what the organisation considers its principal risks to be, and provides details of how these risks are being controlled and mitigated.

External Audit ARAC are responsible for appointing, reappointing and removing the Group’s external auditor, approving their remuneration and terms of engagement, reviewing service quality and performance and ensuring that it remains independent. Our external auditor attends each committee meeting to provide progress updates against the annual external audit plan and once a year the committee meets with the external auditor without management present. This allows the committee to independently assess the effectiveness of our audit arrangements and obtain an independent view of the strength of our financial controls.

On an annual basis, the committee reviews the independence of the external auditor, to make sure that it remains independent in nature, character and judgment and that our relationship with them remains objective, reasonable and proportionate.

KPMG do not provide any non-audit services to T&D, the committee are satisfied that the key personnel involved in delivering the service demonstrate the appropriate levels of objectivity and independence.

The committee are satisfied that the report produced by the external auditor is fair, balanced and understandable and provides the information necessary for stakeholders to assess the organisation’s position, performance and strategy.

Trent & Dove Annual Report and Accounts 2017/18 | 27

6. The Report of the ARAC Committee effectiveness and 2018/19 priorities As part of its processes for continuous improvement, the committee formally reviews its performance and progress on an annual basis and feeds the results into the Board’s annual Governance Effectiveness Review. To inform its review, the committee seeks feedback from its members, professional advisors and the colleagues who support and service the committee.

The results of the 2017/18 committee effectiveness review has resulted in a review of training requirements for the committee and its members to enable continuous improvement of the committee and increase its technical knowledge to appraise internal controls in technical areas such as finance and treasury management.

Looking forward; the work of the committee during 2017/18 will focus on:  

embedding the outcomes of the risk review project; evolving our business assurance service to add value to team’s internal control processes.

The committee would like to extend their thanks to management, our professional advisors and to all the colleagues who have serviced and supported the committee during the financial year.

Afzal Ismail Chair of Committee

28 | Report of the Audit and Risk Assurance Comittee

7. The Report of the Governance Committee

“Making sure that the business has the right people and processes it needs to operate is important; good leadership sets the tone from the top and inspires great colleagues. The committee’s priority remains making sure that T&D attracts, retains and motivates the very best leaders, whilst ensuring there are governance structures in place which enable and support their decision-making.�

Sophie Churchill, Governance Chair

Sophie Churchill, Governance Chair

Trent & Dove Annual Report and Accounts 2017/18 | 29

7. The Report of the Governance Committee Purpose and Role The purpose of the Governance Committee is to deal with any matters relating to:   

The appointment, removal or remuneration of independent Non-Executive and Executive Directors; The structure, size or composition of the Board and its succession planning; or The way the organisation discharges its Governance responsibilities under the NHF Code of Governance, the Regulator’s Governance and Financial Viability Standards and the organisation’s Rules and Governance Framework.

Remuneration for NEDs is benchmarked regularly against other sector organisations and the pay of Executive Directors is structured to attract, motivate and retain the talented individuals we need to continue to deliver our business successfully. More information about NED and Executive Director pay can be found in the Notes to the financial statements on page 58.

Our Work During 2017/18 The Committee has undertaken the following work during the financial year to discharge the responsibilities set out in its Terms of reference:        

Review and approval of the remuneration for all Board and Committee Members, including T&D’s subsidiary First Housing (March 2017); Review and approval of the Board Succession Plan and Re-appointments for 2017 (April 2017); Review and approval of the Board Appraisal Structure and Process for 2017, including reviewing appraisal outcomes for the Chair and Chief Executive (April 2017); Review and approval of the Board Recruitment and Succession Policy (August 2017); Review and approval of Staff Survey outcomes (August 2017); Review of the objectives and Stretch Targets for members of the Executive Team (September 2017); Review of the plans for recruitment of Director of Finance and Director of Operations (February 2017); Review of the proposals for changes to Staff Terms and Conditions, the introduction of a Staff Bonus Scheme and the introduction of a Staff Health Care Scheme (February 2017).

Looking Forward – 2018/19 During 2018/19 the work of the committee will include: 1. Overseeing the 2018/19 externally facilitated Governance Effectiveness Review, including a full review of the skills recruitments for all Board committees for the short, medium and long-term in line with our strategic objectives to 2022; 2. Developing a plan for recruiting 2 new independent Non-Executive Directors to replace 2 members of our Board who will retire in 2020; 3. Planning for the Chair’s succession. The current Chair is due to retire in 2021, and the Committee will be preparing for this transition, including any appointment of a Chair Designate in 2020.

Sophie Churchill Chair of Committee 30 | Report of the Governance Comittee

8. The Report of the Operations Committee

“The Committee plays a key role in scrutinising service delivery and operational strategy on behalf of our tenant-base.

This ensures that all processes undertaken and designed by the organisation have tenant’s views and best interests at their heart and that the business retains its focus on delivering the very best value for money spent.”

Sally Gibson –Operations Chair

Trent & Dove Annual Report and Accounts 2017/18 | 31

8. The Report of the Operations Committee Purpose and Role The purpose of the Operations committee is to ensure that the operational processes carried out by all areas of the business meet the targets set by the Board. The Committee’s focus is on service delivery and customer satisfaction, having regard to financial performance and budgetary control.

The Committee aims to ensure that services:    

are delivered in a cost effective way; achieve value for money in all its dealings; taking into account accepted good practice including Diversity and Inclusion; and applying the principles of continuous improvement and quality management.

Our Work during 2017/18 The Committee has undertaken the following work during the financial year to discharge the responsibilities set out in its Terms of Reference:  Reviewed Asset Management projected outturns;  Reviewed recommendation on budget requirements within the operational areas of Property Services and Housing Services including Social Value;  Reviewed delivery of all service programmes;  Approved KPI Operational Targets (annually);  Reviewed Operational KPI’s, including H&S and HR Performance;  Reviewed the Self Assessment of Compliance with the HCA Consumer Regulatory Standards;  Instigated Periodic service reviews, such as reviews of Lettable Standards and Voids;  Reviewed community and neighbourhood initiatives;  Communicated and engaged with Resident Involvement groups;  Supply and demand of properties; lettings statistics including the diversity of service users;  Reviewed performance of complaints that reach the second stage of the Complaints procedure;  Report to the Board concerns to reputational risks by exception;  Approved former tenant repair recharge and other debt write offs over £1,000;  Reviewed and approved key policies affecting tenants, including the Complaints Policy.

Looking Forward – 2018/19 During 2018/19 the work of the committee will include:   

Continued and focused scrutiny of service, performance and operational delivery; Recruiting new members for our tenant scrutiny and engagement groups; Forging closer links to operational teams across the business.

Special thanks to the Tenant Scrutiny Forum Whilst they are not part of our formal governance structure, the Tenant Scrutiny Forum plays a key role in reviewing and scrutinising service and policy development before the details come up to the Committee for review and approval. In this way, the Forum plays a valuable role in making sure that the tenant voice is heard, and in shaping and challenging our plans so that our proposals become the very best they can be.

On behalf of my fellow committee members, I would like to thank all the tenants who are involved in our tenant involvement and engagement activities, and I look forward to welcoming new customer members onto our Committee, and into the Tenant Scrutiny Forum, during 2018/19.

Sally Gibson Chair of Committee Tr32 | Report of the Operations Comittee ua

9. Performance Overview 2017/18 Group Financial Performance Our key financial objectives are:   

Achieving VFM through cost control and income maximisation thus ensuring the subsequent surpluses are used to contribute to our 4 strategic objectives Ensuring that all funders covenants are fully met Ensuring the association’s short and medium tem liquidity is monitored, sustained and reported.

The association’s accounting policies are set out on pages 50 - 55 of the financial statements. The summarised elements from the financial statements are:

Turnover from Lettings Other Turnover 1st Tranche Share Ownership Turnover

2017/18 £m 26,707 995 1,273 28,975

Lettings Operating Costs Other Operating Costs Cost of Sales Operating Surplus

(17,660) (1,557) (663) 9,095

(17,452) (1,613) (231) 8,653

(17,819) (1,691) (123) 7,870

Surplus on Disposals Net Interest Charge Movement in Fair Value Curtailment Gain Surplus before Taxation

1,068 (3,865) 278 0 6,576

912 (3,956) 82 419 6,110

1,092 (3,878) 27 0 5,111

Statement of Comprehensive Income

  

2016/17 £m 26,607 884 458 27,949

2015/16 £m 26,459 862 182 27,503

Continued increase in operating surplus from lettings from previous years Increased surplus regarding shared ownership sales Savings in interest payments predominantly due to LGPD defined benefit liability

Housing Properties at Cost Depreciation Housing Properties Net Book Value Other Fixed Assets Long Term Grant Liabilities Net Current Assets/Liabilities Assets less current liabilities and Grant

2017/18 £m 191,904 (40,093) 151,811 3,167 (20,942) 30,174 164,210

2016/17 £m 173,066 (36,560) 136,506 2,864 (19,641) (757) 118,972

2015/16 £m 160,353 (32,923) 127,430 2,952 (17,128) (1,057) 112,197

Reserves Pension Other Long Term Liabilities Net debt Funding

34,573 2,787 1,818 125,032 164,210

27,523 3,646 2,018 85,785 118,972

18,641 6,749 1,077 85,730 112,197

Statement of Financial Position

  

Significant increased expenditure regarding new properties Net Current Assets contains short term investment of monies regarding THFC Loan (also reflected in increase in Net Debt) £859k reduction in pension liability.

The benchmarking of these results can be seen in the VFM statement at page 38. & Trent & Dove Annual Report and Accounts 2017/18 | 33

9. Performance Overview 2017/18 Financial Covenants Operating Margin EBITDA Gearing Net debt per Unit

2017/18 31.4% 258.4% 79.7% £15,477

2016/17 31.0% 268.4% 61.7% £14,700

2015/16 28.6% 205.4% 65.6% £14,900

Treasury Management At 31st March 2018 T&D’s total group borrowing totalled £ Lloyds Bank Yorkshire Building Society

90,000 3,500

THFC

31,268

Total

124,768

All borrowing is in sterling so attracts no currency risk and all cash reserves are deposited in line with the treasury strategy.

Liquidity remains a key focus for the organisation and at March 2018 we had:   

Cash and cash equivalents immediately accessible of £4.0m £46.5m in undrawn secured funding facilities (including Revolving Credit Facilities) £107m of unencumbered housing properties available to be used as future security.

Our liquidity ratio at 31.03.18, which includes all contractually committed and Board approved development spend, was in excess of 60 months. This was a significant increase from the previous year due to the inclusion of the THFC funding.

Going Concern On the basis of the above, T&D has a reasonable expectation that they have adequate resources to continue in operational existence for the foreseeable future. For this reason, the association continues to adopt the going concern basis in the financial statements.

Key Performance Indicators During 2017/18, we have undertaken a review of our performance management approach, introduced new scorecards at Board and Executive level and embedded a strong culture of performance review and improvement.

34 | Performance Overview 2017/18 Trent

9. Performance Overview 2017/18 The summary targets for 2017/18 were Figure 7 2017/18 Targets We will build 166 new properties

We will invest £2.5m in improvement of our homes

During 2017 we will develop and SROI model for year 1 reporting in 18/19

We will be generating revenues of £31m with surpluses of £3.9m for reinvestment

We will invest £25.5m in capital expenditure to secure new growth

985 of repairs will be carried out within 7 days of notification

We will deliver 1200 community hours of volunteering

We will deliver £1.1m of efficiencies

We will carry out a 5 year analysis of demand and produce a customer profile for 2018-2022

The average number of empty (void) days will be reduced to 20

We will invest 1.5% of all income in community and support programmes

65% of staff will rate T&D as “a great place to work”

We will secure and additional; £50m of lending facilities to support our growth objectives

100% of properties will be compliant with statutory and regulatory standards

We will provide a minimum of 10 employment opportunities through apprenticeships in T&D

V1/G1 rated

80% of customer s who experiences out service will rate is as good or outstanding

We will support our FirstCall service to grow and become financially viable and sustainable

Our H&S OTI will be 85%

We will support 2200 individuals in to work (2000 in 2016/17) Whilst the majority of targets were achieved the following are areas for continued improvement in 2018/19:    



We have not yet completed our five year demand analysis – this will be concluded in 2018/19 We have secured £30m of lending facilities – the remainder will be secured when required Our Voids days have not met target and we are addressing this as a key improvement area for 2018/19 Whilst we did not reach 1.5% of investment in community projects (1.39% outturn) all projects identified were carried out to high standard. During 2018/19 we will be ensuring this area has strong forward plan and outcomes Our People Strategy will continue to drive our ‘Great Place to Work’ measure following a year of organisational change.

We are pleased to report strong progress and performance see Figure 8.

Trent & Dove Annual Report and Accounts 2017/18 | 35

9. Performance Overview 2017/18 Figure 8 Performance 2017/18

New homes 179 Target 166 Further 197 committed for development

Efficiency savings

Rent collected

ÂŁ1.3m

98.14%

Number of people who achieved sustained employment -

Over 8000 volunteering hours (target 4000) 8 volunteers contributed to our community programme this year

Number of families receiving assisted support such as mental health or parental care92 (target 60)

% of revenue invested in our communities 1,39%,over ÂŁ400k

88% of customers surveyed

86% of customers say

believe their rent provides value for money

their Trent & Dove home provides a great place to live

100% of our repairs

93% of colleagues agree or

100% compliance for

were carried out within our customer agreed date

moderately agree that Trent & Dove is a great place to work

fire, electrical gas asbestos and legionella - keeping our customers safe.

47

(target 0.9m)

36 | Performance Overview 2017/18 Trent

9. Performance Overview 2017/18 What Value for Money means to T&D Value for Money is a primary strategic focus for T&D and is reviewed regularly by Board.

2017/18 continued to be a challenging year for T&D and the sector as a whole. T&D has responded with a business plan based on achieving a continued reduction of ÂŁ2.8m in our operating costs. Within this value, the most significant elements are efficiencies in routine and planned maintenance achieved by bringing the repairs service in-house, a reduction in management costs, procurement savings and the closure of the Local Government Pension Scheme.

During 2017/18, the Regulator of Social Housing (RSH) unveiled an overhauled VFM regime for the sector. This includes a new set of metrics against which the associations will be assessed and benchmarked.

Trent & Dove Annual Report and Accounts 2017/18 | 37

9. Performance Overview 2017/18 The results of those metrics for T&D for 2017/18 (showing 2016/17 equivalents) are shown below: Metric No.

1

2

3

4

5

6

7

8

Note Definition

Reinvestment: measures investment in Properties (both Existing and New Build Supply)

2017/18 Actual

2016/17 Actual

2016/17 Sector Median

Year on Year Performance

Compared to Sector Median?

13.37%

10.21%

5.62%





2.99%

2.68%

1.24%





New Build Supply (Social Housing): No of Social Housing Units delivered as percentage of existing stock Gearing – measures % of assets made up of debt and reliance on debt funding

1

79.77%

61.76%

43.17%





EBITDA MRI Interest Cover – measures surplus generated compared to interest payable

2

257%

268%

216%





2

£2,926

£2,818

£3,298





Headline Social Housing Cost per Unit Operating Margin (Social Housing Lettings)

2

33.88%

34.41%

34.33%





31.29%

30.96%

31.16%





5.49%

6.90%

4.37%





Operating Margin (Overall)

Return on Capital Employed (ROCE)

1

Sector Median Calculated from Global Accounts Statistics

Notes Metrics 1 and 2 - Reinvestment - one of T&D’s major objectives is to generate robust surpluses to maximise our capacity to build quality new homes and protect investment in our existing homes and services. In 2017/18 we spent £16.8m on capital expenditure on new homes producing 179 new units (2016/17 156). In addition, we spent a further £3.5m (2016/17 £2.8m) on improvement works to existing properties. This resulted in not only an improvement to the metric year on year, but a substantial increase on the sector median.

Metric 3 - Gearing - the negative movement is wholly attributable to the recognition in the statement of financial position (SOFP) of the new £30m loan from The Housing Finance Corporation. However, as the cash was not received by the year-end, due to the security charging process, other revolver loans could not be repaid. Should the cash have been received then the gearing ratio would have been 60.02%, which would still have put T&D above the sector median. This reflects the association’s ambition regarding future growth of units and the financial base required to support this future spend.

Metrics 4, 5 and 6 - All metrics based on the Operating Surplus for 2017/18 show a marginal reduction to the previous year. Whilst ongoing management, service, routine maintenance and other costs have continued to reduce, as evidenced in the table below, the Board approved decision to accelerate our investment in existing properties by expending a further one-off £1.3m on major repairs and compliance work has resulted in an increase to major repairs which in turn results in the reduction in operating margin.

38 | Performance Overview 2017/18 Trent

9. Performance Overview 2017/18 Average Costs Per Unit (CPU)

Headline Social Housing CPU Management CPU Service Charge CPU Maintenance CPU Major Repairs CPU Other Social Housing CPU

2017/18

2016/17

2015/16

£

£

£

2,926 783 226 988 726 203

2,818 848 236 1005 486 243

3,267 824 286 1024 902 230

2016/17 Sector Median £

Year on Year £

Compared to Sector Median? £

3,298 941 372 925 683 241

     

     

Examples of the efficiency savings that were realised during are: Category

Target saving

Actual saving

Comment

Asset Management

£400,000

£307,020

Efficient delivery of major void works by internal team, previously outsourced. Reduced demand for ad-hoc gas works, legionella spend saving due to alternative programme delivering the requirements.

Service costs

£146,000

£492,870

Grounds maintenance procurement and reduced demand for services, reduced estate spend and reduction in discretionary spend

Pensions Management Costs

£202,000 £181,000

£202,000 £306,552

Closure of LGPS scheme Digital work streams, implementation of efficient storage and parking solutions, reduced external spend for consultants and decision to amortise new loan costs

Pay increase

£50,000

£50,000

Limited to 1%

Total

£979,000

£1,358,442

The association continues to measure tenant satisfaction to ensure the efficiency savings achieved are not having a detrimental impact. For 2017/18 the overall satisfaction score for those tenants contacted was 89%, whilst 88% perceived their rent as providing value for money. This is the first year results have been collected using this methodology, and the ongoing results will continue to be monitored.

Metric 7 – Overall Margin - the increase in surpluses from the first Tranche sale of shared ownership properties has resulted in the negative movement regarding SHL margin being reversed to a positive movement in overall margin. T&D sold a total of 23 units resulting in a total surplus of £610k (2016/17 £227k).

Metric 8 Return of Capital Employed (ROCE) – as with metric 3, ROCE has been impacted by the inclusion of the THFC loan. However if the cash had been received ROCE would still have remained lower than 2016/17 at 5.87%. This reflects the increase in year of the value of Housing properties of £15.3m delivering 179 new units.

Trent & Dove Annual Report and Accounts 2017/18 | 39

9. Performance Overview 2017/18 Future Priorities and Prospects The external environment has become increasingly uncertain as a result of general political and economic uncertainty, Brexit, welfare changes and increasing regulatory scrutiny.

Housing has been a government focal point in the year, and the 2018/19 strategic plan addresses all these areas with a strong compliance strategy, ongoing commitment to build more homes in our region and revisiting assumptions on revenue and accelerating investment in our existing homes.

T&D have an ambitious growth agenda and over the last three years, have delivered 414 homes, with a notable increase in 2017/18 delivering 179. T&D will continue to invest in the provision of much needed new homes to meet the identified housing needs in our operational area. Through the delivery of a mixed portfolio of development opportunities and use of capacity and funding, the development programme over the next seven years will aim to deliver a further 1,306 homes at a net cost of £125 million. This aspirational development programme will require additional future funding, using our current excess security, and will impact on future surpluses but T&D’s financial plan is constructed to ensure they remain in a robust position to manage future risks and ensure there is sufficient covenant headroom at all times.

Key results from the recently approved financial plan evidence the association’s target of increasing units whilst also increasing surpluses by reducing cost per unit. Some of these key targets are:

Properties Operating Surplus Net Surplus Headline CPU EBITDA MRI Gearing

2018/19 6,128 £7,754k £3,729k £2,945 203% 63.0%

2019/20 6,413 £7,959k £3,346k £2,818 186% 65.4%

2020/21 6,551 £9,637k £4,631k £2,825 200% 62.9%

2021/22 6,702 £9,536k £4,363k £3,028 190% 61.6%

2022/23 6,872 £10,161k £4,596k £3,014 198% 62.7%

The Board has looked closely at the current operating environment and recognises that running a cost effective business is vital, and there will be some stretching targets and key issues to be addressed in the future. We will continue to benchmark our performance against the sector using data from the Vantage Performance Improvement Club and Global Accounts published by the RSH. Whilst the appetite in the sector for merger continues, the Board of T&D remains open to assessing opportunities should appropriate long-term sustainable benefits be generated for tenants and stakeholders.

The Board have established clear criteria which it considers any merger opportunity might meet. The criteria has been recently tested.

But we remain committed to delivering excellent VFM to our residents and communities, now and as part of our longer term plans, by making informed financial and operational decisions. This is one of T&D’s core values and is integral to our 2020 vision; Transforming Homes, Lives and Neighbourhoods.

Key Strategic Projects for 2018/19 Revenue sustainment Universal Credit will be implemented in our region during 2018/19. We have carried out a full review of the opportunities and risks this presents. With an already strong tenancy sustainment team and supporting services, such as our employability programs, we believe we are in a strong position to cope with the inevitable disruption. We are working on several additional aspects, including seeking ways to reduce cost of collection, bolstering reporting and training.

We have taken into account earlier adopter’s experience and adjusted our forecast for potential arrears and bad debts appropriately.

40 | Performance Overview 2017/18

9. Performance Overview 2017/18 Existing Stock Condition Whilst we have a strong growth agenda, we have a commitment to maintaining our existing homes to Decent Homes Standards. During 2018/19, we plan to increase the rate we carry out stock condition surveys to ensure that we have up to date and accurate information on which to base our medium to long-term Asset Strategy.

Social Return on Investment (SROI) During 2016/17, we established a basis on which to evaluate our ‘supporting’ services to tenants including our employability, volunteering and family support services. This has enabled us access and use the HACT- Social Value Bank during 2018/19, to establish a clear social return on investment. We strongly believe that the services differentiate T&D and are significant in supporting customers sustain their tenancies. Therefore, the evaluation at the end of this financial year will be a key milestone in evidencing that to the Board, stakeholder and our tenants.

Going Digital During 2017/18, we launched our new website and reinvigorated our social media activities.

During 2018/19, we are aiming to set a clear digital vision for our services, bolstering online access and service requests, and also to enable more effective communication and servicing to customers particularly around the applications process. The move to digital will also inevitably reduce the cost of service long-term.

GDPR Throughout 2017 GDPR has been at the forefront. In May we assessed our Framework as Green with work still to do to fully implement GDPR culture consistently across the organisation. This will remain a key focus to ensure we comply.

Trent & Dove Annual Report and Accounts 2017/18 | 41

10. Report of the Independent Auditors

42 | Report of the Independent Auditors 2017/18

10. Report of the Independent Auditors Opinion We have audited the financial statements of Trent & Dove Housing Limited (“the Association”) for the year ended 31 March 2018 which comprise the Consolidated Statement Of Comprehensive Income, Association Statement Of Comprehensive Income, Consolidated Statement Of Financial Position, Association Statement Of Financial Position, Consolidated Statement Of Changes In Reserves, Consolidated Statement Of Cash Flows and related notes, including the accounting policies in note 1.

In our opinion the financial statements: 

give a true and fair view, in accordance with UK accounting standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland, of the state of affairs of the group and the association as at 31 March 2018 and of its the income and expenditure for the year then ended;



comply with the requirements of the Co-operative and Community Benefit Societies Act 2014; and



have been properly prepared in accordance with the Housing and Regeneration Act 2008 and the Accounting Direction for Private Registered Providers of Social Housing 2015.

Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independent of the group and the association in accordance with, UK ethical requirements including the FRC Ethical Standard. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.

Going concern We are required to report if we have concluded that the use of the going concern basis of accounting is inappropriate or there is an undisclosed material uncertainty that may cast significant doubt over the use of that basis for a period of at least twelve months from the date of approval of the financial statements. We have nothing to report in these respects.

Other information The association’s Board is responsible for the other information, which comprises the Strategic and Board Report. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work, we have not identified material misstatements in the other information.

Matters on which we are required to report by exception Under the Co-operative and Community Benefit Societies Act 2014 we are required to report if, in our opinion: 

the association has not kept proper books of account; or



the association has not maintained a satisfactory system of control over transactions; or



the financial statements are not in agreement with the association’s books of account; or



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

We have nothing to report in these respects.

Trent & Dove Annual Report and Accounts 2017/18 | 43

10. Report of the Independent Auditors Board’s responsibilities As more fully explained in their statement set out on page 14, the association’s Board is responsible for the preparation of financial statements which give a true and fair view; such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the group and the association’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless it either intends to liquidate the group or the association or to cease operations, or has no realistic alternative but to do so.

Auditor’s responsibilities 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 our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC’s website: www.frc.org.uk/auditorsresponsibilities

The purpose of our audit work and to whom we owe our responsibilities This report is made solely to the association in accordance with section 87 of the Co-operative and Community Benefit Societies Act 2014 and section 128 of the Housing and Regeneration Act 2008.

Our audit work has been undertaken so that we might state to the association those matters we are required to state to it in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the association as a body, for our audit work, for this report, or for the opinions we have formed.

Sarah Brown For and on behalf of KPMG LLP, Statutory Auditor Chartered Accountants 30th August 2018

44 | Report of the Independent Auditors

Notes to the Financial Statements CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the year ended 31 March 2018 Note

Turnover Operating expenditure Gain on disposal of property, plant and equipment Surplus on revaluation of investment properties Operating surplus Interest and financing costs Finance Income Curtailment gain Surplus before tax Taxation

2018

2017

£'000

£'000

3

28,975

27,949

3 4 13

(19,880) 1,068 278

(19,296) 912 82

3

10,441

9,647

5 6 22

(3,872) 7 -

(3,966) 10 419

7

6,576

6,110

10

(46)

(7)

6,530

6,103

520

2,779

7,050

8,882

2018

2017

£'000

£'000

Surplus for the year Actuarial gain in respect of pension schemes

22

Total comprehensive income for the year

ASSOCIATION STATEMENT OF COMPREHENSIVE INCOME For the year ended 31 March 2018 Note

Turnover

3

28,873

27,904

Operating expenditure Gain on disposal of property, plant and equipment

3 4

(19,838) 1,068

(19,260) 912

Operating surplus

3

10,103

9,556

5 6 22

(3,872) 15 -

(3,966) 19 419

6,246

6,028

520

2,779

6,766

8,807

Interest and financing costs Finance Income Curtailment gain Surplus for the year Actuarial gain in respect of pension schemes

22

Total comprehensive income for the year

45

CONSOLIDATED STATEMENT OF FINANCIAL POSITION At 31 March 2018 Note

Fixed Assets Intangible Assets Housing properties Investment Properties Other property, plant and equipment

11 12 13 13

Current assets Stock Debtors Short Term Investments Cash & Cash Equivalents

14 15 16

Creditors: amounts falling due within one year

17

Net current assets / (liabilities) Total assets less current liabilities

2018

2017

ÂŁ'000

ÂŁ'000

139 151,811 1,202 1,826

175 136,506 924 1,765

154,978

139,370

963 1,013 32,449 4,037

272 1,748 1,120 1,607

38,462

4,747

(8,288)

(5,504)

30,174

(757)

185,152

138,613

Creditors: amounts falling due after more than one year

18

(147,636)

(107,334)

Defined benefit pension liability

22

(2,787)

(3,646)

Provision for deferred taxation

23

(156)

(110)

Net assets

34,573

27,523

Capital and reserves Revenue reserve

34,573

27,523

Total reserves

34,573

27,523

th

The financial statements were approved by the Board on 11 July 2018 and signed on its behalf by:-

Chairman

Non-executive Director

46

Secretary

ASSOCIATION STATEMENT OF FINANCIAL POSITION At 31 March 2018 Note

Fixed Assets Intangible Assets Housing properties Other property, plant and equipment

11 12 13

Current assets Stock Debtors Short Term Investments Cash & Cash Equivalents

14 15 16

Creditors: amounts falling due within one year

17

Net current assets / (liabilities) Total assets less current liabilities

2018

2017

ÂŁ'000

ÂŁ'000

139 151,811 1,826

175 136,506 1,765

153,776

138,446

963 1,255 32,449 3,929

272 2,060 1,120 1,484

38,596

4,936

(8,267)

(5,486)

30,329

(550)

184,105

137,896

Creditors: amounts falling due after more than one year

18

(147,636)

(107,334)

Defined benefit pension liability

22

(2,787)

(3,646)

Net assets

33,682

26,916

Capital and reserves Revenue reserve

33,682

26,916

Total reserves

33,682

26,916

th

The financial statements were approved by the Board on 11 July 2018 and signed on its behalf by:-

Chairman

Non-executive Director

47

Secretary

CONSOLIDATED STATEMENT OF CHANGES IN RESERVES At 31 March 2018 Income and expenditure reserve

At 1 April Surplus for the year Actuarial gain in respect of pension schemes

Balance at 31 March

2018

2017

£'000

£'000

27,523

18,641

6,530

6,103

520

2,779

34,573

27,523

ASSOCIATION STATEMENT OF CHANGES IN RESERVES At 31 March 2018 Income and expenditure reserve

At 1 April Surplus for the year Actuarial gain in respect of pension schemes

Balance at 31 March

48

2018

2017

£'000

£'000

26,916

18,109

6,246

6,028

520

2,779

33,682

26,916

CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 31 March 2018 Balance at 31 March

34,573

27,523

-

-

2018

2017

ÂŁ'000

ÂŁ'000

15,627

11,890

(20,306) (60)

(13,975) (7)

1,501 1,473 14

2,444 2,753 10

Net cash flows from investing activities

(17,378)

(8,775)

Cash flows from financing activities Interest paid New Loans New Short Term Investments

(3,726) 39,236 (31,329)

(3,677) -

Check

TRENT & DOVE HOUSING LTD Consolidated Statement of Cash Flows for the year ended 31 March 2018 Note

Net cash generated from operating activities

25

Cash flows from investing activities Purchase of property, plant and equipment Purchase of intangible assets Proceeds from sale of property, plant & equipment Grants received Interest received

49

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018

over their useful economic lives. Freehold land is not depreciated.

1.

ACCOUNTING POLICIES

Major components

The principal accounting policies are summarised below. They have all been applied consistently throughout the year and to the preceding year.

Major components of housing properties, which have significantly different patterns of consumption of economic benefits, are treated as separate assets and depreciated over their expected useful economic lives as follows:

General information and basis of accounting The financial statements have been prepared under the historic cost convention, modified to include certain items at fair value, in accordance with Financial Reporting Standard 102 (FRS 102) issued by the Financial Reporting Council and comply with the Statement of Recommended Practice for registered social housing providers 2014 (SORP), the Housing and regeneration Act 2008 and the Accounting Direction for private registered providers of social housing 2015. Trent & Dove Housing Association is a public benefit entity, as defined in FRS 102 and applies the relevant paragraphs prefixed ‘PBE’ in FRS 102.

Boilers

10 years

Central Heating Systems

25 years

Roofs

40 years

Windows

25 years

Doors

20 years

Kitchens

15 years

Bathrooms

25 years

Electrics

30 years

Structure

80 years

Basis of consolidation

Properties held on long leases are depreciated over their useful economic lives or the lease duration if shorter.

The group financial statements consolidate the financial statements of the Association and its subsidiary undertakings drawn up to 31 March each year.

Improvements Where there are improvements to housing properties that are expected to provide incremental future benefits, these are capitalised and added to the carrying amount of the property. Any works to housing properties which do not replace a component or result in an incremental future benefit are charged as expenditure in surplus or deficit in the Statement of Comprehensive Income.

Going Concern The Board has considered those areas that could give rise to significant financial exposure and are satisfied that no material or significant exposures exist other than those reflected in these financial statements and that the group have adequate resources to continue its operations into the foreseeable future.

Leaseholders

For this reason the going concern basis has been adopted in preparing the financial statements.

Where the rights and obligations for improving a housing property reside with the leaseholder or tenant, any works to improve such properties incurred by the Association is recharged to the leaseholder and recognised in surplus or deficit in the Statement of Comprehensive Income along with the corresponding income from the leaseholder or tenant.

Property, plant and equipment – housing properties Housing properties are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the cost of acquiring land and buildings and directly attributable development costs. Capitalisation ceases when substantially all the activities that are necessary to get the asset ready for use are complete.

Non-housing property, plant and equipment Non-housing property, plant and equipment is stated at historic cost less accumulated depreciation and any provision for impairment.

Depreciation is provided on all non-housing property, plant and equipment, other than

Depreciation is charged so as to write down the net book value of housing properties to their estimated residual value, on a straight line basis,

50

nvestment properties and freehold land, at rates calculated to write off the cost or valuation, less estimated residual value, or each asset on a straight-line basis over its expected useful life, as follows.

Freehold office building

Impairment of social housing properties Properties held for their social benefit are not held solely for the cash inflows they generate, they are also held for their service potential.

50 years

Furniture, fixtures and fittings

5 years

Motor vehicles

5 years

Computer equipment

3 years

Plant and equipment

10 years

An assessment of impairment is made at each reporting date as to whether an indicator exists. If such an indicator exists, an impairment assessment is carried out and an estimate of the recoverable amount of the asset is made. Where the carrying amount of the asset exceeds its recoverable amount, an impairment loss is recognised in surplus or deficit in the Statement of Comprehensive Income. The recoverable amount of an asset is the higher of its value in use and fair value less costs to sell. Where assets are held for their service potential, value in use is determined by the present value of the asset’s remaining service potential plus the net amount expected to be received from its disposal.

Depreciated replacement cost is taken as a suitable measurement model.

Investment Properties The classification of properties as investment property or property, plant and equipment is based upon the intended use of the property.

Properties held to earn commercial rentals or for capital appreciation or both are classified as investment properties. Properties that are used for administrative purposes or that are held for the provision of social housing are treated as property, plant and equipment. Mixed use property is separated between investment property and property, plant and equipment.

An impairment loss is reversed if the reasons for the impairment loss have ceased to apply and included in surplus or deficit in the Statement of Comprehensive Income.

Social Housing Grant and other Government grants Where grants are received from government agencies such as the Homes and Communities Agency, local authorities, devolved government agencies, health authorities and the European Commission which meet the definition of government grants they are recognised when there is reasonable assurance that the conditions attached to them will be complied with and that the grant will be received.

Land is accounted for based on its intended use.

Where land is acquired speculatively with the intention of generating a capital gain and/or a commercial rental return it is accounted for as an investment property. Where land is acquired for use in the provision of social housing or for a social benefit it is accounted for as property, plant and equipment.

Investment properties are measured at fair value annually with any change recognised in surplus or deficit in the Statement of Comprehensive Income.

Government grants are recognised using the accrual model and are classified either as a grant relating to revenue or a grant relating to assets.

Grants relating to revenue are recognised in income on a systematic basis over the period in which related costs for which the grant is intended to compensate are recognised. Where a grant is receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support with no future

Intangible assets Intangible assets are stated at historic cost less accumulated amortisation and any provision for impairment. Amortisation is provided on all intangible assets at rates calculated to write off the cost of each asset on a straight-line basis over its expected useful life, as follows: Computer software

3 years

51

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 1.

For shared ownership staircasing sales, when full staircasing has not taken place, the recycling of the grant may be deferred if the net sales proceeds are insufficient to meet the grant obligation relating to the disposal and not be recognised as a provision. On subsequent staircasing sales, the requirement to recycle the grant becomes an obligation if sufficient sales proceeds are generated to meet the obligation and a provision is recognised at this point.

ACCOUNTING POLICIES (continued) related costs, it is recognised as revenue in the period in which it becomes receivable.

Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset.

On disposal of an asset for which government grant was received, if there is no obligation to repay the grant, any unamortised grant remaining within liabilities in the Statement of Financial Position related to this asset is derecognised as a liability and recognised as revenue in surplus or deficit in the Statement of Comprehensive Income.

Grants received for housing properties are recognised in income over the expected useful life of the housing property structure. Where a grant is received specifically for components of a housing property, the grant is recognised in income over the expected udeful life of the component.

Grants received from non-government sources are recognised as revenue using the performance model.

Leased assets At inception the Group assesses agreements that transfer the right to use assets. The assessment considers whether the arrangement is, or contains, a lease based on the substance of the arrangement.

Where a donation of land and/or other assets is received or land and/or other assets are acquired at below market value from a government source, this is accounted for as a non-monetary government grant and included in the Statement of Financial Position as a liability.

Finance Leased Assets Leases of assets that transfer substantially all the risks and rewards incidental to ownership are classified as finance leases.

Where a donation of land and/or other assets is received or acquisitions of land and/or other assets at below their market value from a third party that does not meet the definition of a government source the transaction is recognised as an asset in the Statement of Financial Position at fair value, taking account of any restrictions on the use of the asset and income equivalent to the difference between any amounts paid or payable for the asset and the fair value of the asset is recognised in surplus or deficit in the Statement of Comprehensive Income as a future donation when future performance-related conditions are met.

Finance leases are capitalised at commencement of the lease as assets at the fair value of the leased asset or, if lower, the present value of the minimum lease payments calculated using the interest rate implicit in the lease.

Assets are depreciated over the shorter of the lease term and the estimated useful life of the asset. Assets are assessed for impairment at each reporting date.

The capital element of lease obligations is recorded as a liability on inception of the arrangement. Lease payments are apportioned between capital repayment and finance charge, using the effective interest rate method, to produce a constant rate of charge on the balance of the capital payments outstanding.

Recycling of grants Where there is a requirement to either repay or recycle a grant received for an asset that has been disposed of, a provision is included in the Statement of Financial Position to recognise this obligation as a liability. When approval is received from the funding body to use the grant for a specific development, the amount previously recognised as a provision for the recycling of the grant is reclassified as a creditor in the Statement of Financial Position.

Operating leased assets Leases that do not transfer all the risks and rewards of ownership are classified as operating leases.

Payments under operating leases are charged to surplus or deficit in the Statement of

52

comprehensive Income on a straight-line basis over the period of the lease.

Pensions

Interest payable

Multi-employer defined benefit pension scheme – Social Housing Pension Scheme The Group participates in an industry wide multiemployer defined benefit pension scheme where the scheme assets and liabilities cannot be separately identified for each employer. This is accounted for as a defined contribution scheme as there is insufficient information available to account for the scheme as defined benefit. For this multi-employer scheme, there is a contractual agreement between the scheme and the Group that determines how the deficit will be funded and a liability is recognised in the Statement of Financial Position and the resulting expense in surplus or deficit in the Statement of Comprehensive Income for the present value of the contributions payable that arise from the agreement to the extent that they relate to the deficit.

Borrowing costs are interest and other costs incurred in connection with the borrowing of funds. Borrowing costs are calculated using the effective interest rate, which is the rate that exactly discounts estimated future cash payments or receipts through the expected life of a financial instrument and is determined on the basis of the carrying amount of the financial liability at initial recognition. Under the effective interest method, the amortised cost of a financial liability is the present value of future cash payments discounted at the effective interest rate, and the interest expense in a period equals the carrying amount of the financial liability at the beginning of a period multiplied by the effective interest rate for the period.

Taxation

Local Government Pension Scheme The Group participated in a local government st pension scheme until 31 March 2017. This is a multi-employer scheme where it is possible for individual employers as admitted bodies to identify their share of the assets and liabilities of the pension scheme. For this scheme the amounts charged to operating surplus are the costs arising from employee services rendered during the period and the cost of plan introductions, benefit changes, settlements and curtailments. They are included as part of staff costs. The net interest cost on the net defined benefit pension liability is charged to revenue and included within finance costs. Remeasurement comprising actuarial gains and losses and the return on scheme assets (excluding amounts included in net interest on the net defined liability) are recognised immediately in other comprehensive income.

Current tax is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been enacted or substantively enacted by the Statement of Financial Position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the Statement of Financial Position date where transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the Statement of Financial Position date. Timing differences are differences between the Group’s taxable surpluses and its results as stated in the financial statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the financial statements.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that, on the basis of all available evidence, it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.

Defined benefit schemes are funded, with the assets of the scheme held separately from those of the Group, in separate trustee administered funds. Pension scheme costs are measured at fair value and liabilities are measured on an actuarial basis using the projected unit credit method. The actuarial valuations are obtained at least triennially and are updated at each Statement of Financial Position date.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the Statement of Financial Position date that are expected to apply to the reversal of the timing difference. Deferred tax relating to property, plant and equipment measured using the revaluation model and investment property is measured using the tax rates and allowances that apply to the sale of the asset.

Defined contribution scheme The Group participates in a defined contribution scheme where the amount charged to surplus or deficit in the Statement of Comprehensive Income in respect of pension costs and other postretirement benefits is the contributions payable in

53

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 1.

recovery of leaseholders’ or tenants’ variable service charges and recovery of the outstanding balance is virtually certain, the balance is recognised in the Statement of Financial Position as a trade receivable. Debit and credit balances on individual schemes are not aggregated as there is no right of set-off.

ACCOUNTING POLICIES (continued) the year. Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the Statement of Financial Position.

Financial instruments

Turnover

Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument.

Turnover represents rent and service charges receivable (net of rent and service charge losses from voids) and disposal proceeds of current assets such as shared ownership first tranche sales at completion together with revenue grants from local authorities and the Homes and Communities Agency. Service charge income is recognised when expenditure is incurred as this is considered to be the point at which the service has been performed and the revenue recognition criteria met.

Financial assets carried at amortised cost Financial assets carried at amortised cost comprise rent arrears, trade and other receivables and cash and cash equivalents. Financial assets are initially recognised at fair value plus directly attributable transaction costs. After initial recognition, they are measured at amortised cost using the effective interest rate method.

Discounting is omitted where the effect of discounting is immaterial.

Shared ownership property sales

If there is objective evidence that there is an impairment loss, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate.

The carrying amount of the asset is reduced accordingly.

Shared ownership properties, including those under construction, are split between non-current assets and current assets. The split is determined by the percentage of the property to be sold under the first tranche disposal which is shown on initial recognition as a current asset, with the remainder classified as a non-current asset within property, plant and equipment. Where this would result in a surplus on the disposal of the current asset that would exceed the anticipated overall surplus, the surplus on disposal of the first tranche is limited to the overall surplus by adjusting the costs allocated to current or noncurrent assets.

A financial asset is derecognised when the contractual rights to the cash flows expire, or when the financial asset and all subsequent risks and rewards are transferred.

If an arrangement constitutes a financing transaction, the financial asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Proceeds from first tranche disposals are accounted for as turnover in the Statement of Comprehensive Income of the period in which the disposals occur and the cost of sale is transferred from current assets to operating costs. Proceeds from subsequent tranche sales are treated as disposals of fixed assets.

Financial liabilities carried at amortised cost

Service charge sinking funds and service costs

These financial liabilities include trade and other payables and other interest bearing loans and borrowings.

Unutilised contributions to service charge sinking funds and over-recovery of service costs which are repayable to tenants or leaseholders or are intended to be reflected in reductions to future service charge contributions are recognised as a liability in the Statement of Financial Position. The amount included in liabilities in respect of service charge sinking funds includes interest credited to the fund. Where there has been an under-

Non-current debt instruments which meet the necessary conditions in FRS 102 are initially recognised at fair value adjusted for any directly attributable transaction costs and subsequently measured at amortised cost using the effective interest method, with interest-related charges recognised as an expense in finance costs in the Statement of Comprehensive Income. Discounting

54

The Group have to make an assessment as to whether an indicator of impairment exists. In making the judgement, management considered the detailed criteria set out in the SORP.

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 1.

ACCOUNTING POLICIES (continued) Estimation Uncertainty is omitted where the effect of discounting is immaterial. A financial liability is derecognised only when the contractual obligation is extinguished, that is, when the obligation is discharged, cancelled or expires.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related 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.

Cash and cash equivalents Cash and cash equivalents comprise cash in hand and demand deposits, together with other short term highly liquid investments that are readily converted into known amounts of cash and are subject to an insignificant risk of changes in value.

Fair value measurement Management uses valuation techniques to determine the fair value of assets. This involves developing estimates and assumptions consistent with how market participants would price the instrument. Management base the assumptions on observable data as far as possible but this is not always available. In that case, management uses the best information available. Estimated fair values may vary from the actual process that would be achievable in an arm's length transaction at the reporting date.

Gift aid payments Gift aid payments are charged as distributions of reserves in accordance with the guidance included in the Institute of Chartered Accountants technical release ‘Guidance on donations by a company to its parent charity’.

2

SIGNIFICANT MANAGEMENT JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Defined benefit pension scheme

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The Group has obligations 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 the historical experience and current trends.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

Significant management judgements The following are management judgements in applying the accounting policies of the Group that have the most significant effect on the amounts recognised in the financial statements.

Impairment of social housing properties

55

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 3

TURNOVER, OPERATING COSTS AND OPERATING SURPLUS Continuing activities Turnover

Social housing lettings Other social housing activities 1st tranche property sales Charges for support services Development costs not capitalised Surplus on disposal of property, plant and equipment

Activities other than social housing activities Lettings Surplus on revaluation of investment properties Other

Other social housing activities 1st tranche property sales Charges for support services Development costs not capitalised Surplus on disposal of property, plant and equipment

Activities other than social housing activities Other Gift Aid

£'000

Surplus on investment properties £'000

Operating Surplus/ (Deficit) £'000

Turnover

Operating Expenditure

GROUP 2017 Surplus on disposals £’000

Surplus on investment properties £'000

Operating Surplus/ (Deficit) £’000

£'000

£'000

£’000

£’000

26,707

17,660

-

-

9,047

26,607

17,452

-

-

9,155

1,273 267 -

663 464 670

-

-

610 (197) (670)

458 324 -

231 472 727

-

-

227 (148) (727)

-

-

1,068

-

1,068

-

-

912

-

912

28,247

19,457

1,068

-

9,858

27,389

18,882

912

-

9,419

94

42

-

-

52

93

36

-

-

57

634

381

-

278 -

278 253

467

378

-

82 -

82 89

28,975

19,880

1,068

278

10,441

27,949

19,296

912

82

9,647

Operating Expenditure

ASSOCIATION 2018 Surplus on disposals

Operating Expenditure

ASSOCIATION 2017 Surplus on disposals

£'000

£’000

Surplus on investment properties £'000

Operating Surplus/ (Deficit) £’000

Turnover

Social housing lettings

Operating Expenditure

GROUP 2018 Surplus on disposals

Surplus on investment properties £'000

Operating Surplus/ (Deficit) £'000

Turnover

£'000

£'000

£’000

£’000

26,707

17,660

-

-

9,047

26,607

17,452

-

-

9,155

1,273 267 -

663 464 670

-

-

610 (197) (670)

458 324 -

231 472 727

-

-

227 (148) (727)

-

-

1,068

-

1,068

-

-

912

-

912

28,247

19,457

1,068

-

9,858

27,389

18,882

912

-

9,419

626 -

381 -

-

-

245 -

456 59

378 -

-

-

78 59

28,873

19,838

1,068

-

10,103

27,904

19,260

912

-

9,556

56

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 3

TURNOVER, OPERATING COSTS AND OPERATING SURPLUS – GROUP & ASSOCIATION (continued) Particulars of income and expenditure from social housing lettings – group & association Supported Housing and Housing for Older People

General Needs Housing

Other

2018

2017

£'000

£'000

£'000

£'000

£'000

Income Rents receivable Service charge income Amortised government grant Other grants

23,629 959 222 5

983 367 77 -

350 105 10 -

24,962 1,431 309 5

24,737 1,566 287 17

Turnover from social housing lettings

24,815

1,427

465

26,707

26,607

4,432 908 1,848 3,860 826 142 4,222 72 (85) 90

184 347 72 130 30 5 307 2 (5) 3

66 99 5 97 2 (2) 3

4,682 1,354 1,920 3,990 856 152 4,626 76 (92) 96

4,945 1,375 2,106 3,749 648 62 4,348 121 98

16,315

1,075

270

17,660

17,452

8,500

352

195

9,047

9,155

160

53

27

240

225

Expenditure Management Service charge costs Routine maintenance Planned maintenance Major repairs expenditure Bad debts Depreciation of housing properties Depreciation of other tangible fixed assets Reversal of Prior Year Impairment Loss Amortisation of intangible assets Operating Expenditure Operating surplus on social housing lettings Void losses

57

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018

4

SURPLUS ON DISPOSAL OF PROPERTY, PLANT AND EQUIPMENT 2018 £'000

2017 £'000

197 (140)

139 (98)

57

41

881 (146)

991 (205)

735

786

Sales of land at market rate Costs of sale

-

66 (11)

Surplus on disposal

-

55

Sales of subsequent tranche shared ownership properties Costs of sale Surplus on disposal

Sales of properties under the right to buy Costs of sale Surplus on disposal

Sales of properties under the right to acquire Costs of sale Transfer to Disposal Proceeds Fund

422 (44) (103)

1,164 (111) (1,023)

275

30

Sales of motor vehicles Costs of sale

1 -

-

Surplus on disposal

1

-

1,068

912

2018 £'000

2017 £'000

3,782 88 2

3,736 227 3

3,872

3,966

Surplus on disposal

Total Surplus on Disposal of Property, Plant & Equipment

5

INTEREST AND FINANCING COSTS

Bank loans and overdrafts Net interest on LGPS defined benefit liability (see note 22) Net interest on SHPS defined benefit liability (see note 22)

58

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 6

OTHER FINANCE INCOME GROUP

Bank interest receivable

2018 £'000

2017 £'000

7

10

7

10

ASSOCIATION 2018 2017 £'000 £'000 Interest receivable from:bank and other sources on loan to group undertaking

7

7 8

10 9

15

19

2018 £'000

2017 £'000

4,702 152 (309)

4,469 62 (287)

28 6

27 9

29 11

37 3

121

109

SURPLUS BEFORE TAXATION – GROUP Surplus before taxation is arrived at after charging / (crediting):

Depreciation of property, plant & equipment Provision for bad debts Government grants External auditors' remuneration (excluding VAT) - for audit services - for non-audit services Internal auditors' remuneration (including VAT) - for audit services - for non-audit services Operating lease rentals: - motor vehicles

59

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 8

STAFF COSTS

Employee costs: Wages and salaries Social security costs Other pension costs (see note 22)

The full time equivalent number of employees who received emoluments, including pension contributions, in excess of £60,000 are shown below.

Salary Band £'000 60,000 - 69,999 70,000 - 79,999 80,000 - 89,999 90,000 - 99,999 100,000 - 109,999 110,000 - 119,999 140,000 - 149,999 180,000 - 189,999

The average full time equivalent number of employees was: Administration Development Housing

60

2018 £'000

2017 £'000

5,126 456 182

5,013 445 244

5,764

5,702

2018 No.

2017 No.

2 2 1 1 1 1 -

2 1 1 1 1

2018 No.

2017 No.

30 6 131

29 6 142

167

177

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 9

DIRECTORS’ REMUNERATION AND TRANSACTIONS

Directors who are executive staff members Wages and salaries Social security costs Other pension costs Compensation for loss of office Non-executive directors Wages and salaries Total

2018 £'000

2017 £'000

328 45 33 -

372 48 44 88

61

61

467

613

Directors are defined as members of the Board, the Chief Executive and any other person who is a member of the Executive Management team.

The Chief Executive is an ordinary member of the pension scheme. No enhanced or special terms apply.

2018 2017 £'000 £'000 Remuneration of the highest paid director, excluding pension contributions: Emoluments 127 168

Remuneration of Non-Executive Directors

Mark Lewis (Chair) Ian Cox (Vice Chair) Mark Ashby Sophie Churchill Sally Gibson Katarzyna Goleniowska Afzal Ismail Alex James Gary Middleton Nicci Miller Geoff Prior Kathryn Robb Michele Curran

Basic salary £ 11,193 7,178 5,220 5,293 7,178 7,178 7,178 4,764 5,293 60,475

61

Expenses £ 2,490 337 360 955 -

Total 2018 £ 13,683 7,515 5,580 5,293 7,178 8,133 7,178 4,764 5,293 -

Total 2017 £ 13,742 7,107 5,497 5,169 5,169 8,888 5,169 7,504 5,169 3,108

4,142

64,617

66,522

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 10

GROUP TAX ON SURPLUS ON ORDINARY ACTIVITIES 2018 £'000

2017 £'000

Current tax on surplus on ordinary activities UK Corporation Tax at 19% (2017: 20%)

-

-

Total current tax

-

-

Deferred tax Origination and reversal of timing differences Effect of increase in tax rate on opening liability

46 -

13 (6)

Total deferred tax (see note 23)

46

7

Total tax on surplus on ordinary activities

46

7

The tax charge comprises:

The differences between the total tax charge shown above and the amount calculated by applying the standard rate of UK corporation tax to the surplus before tax is as follows: 2018 £'000

2017 £'000

Surplus on ordinary activities before taxation

6,576

6,110

1,250

1,222

(1,237) (130) (53) 51 13 152

(1,206) 1 (17) 15 (19) 11 -

46

7

Surplus on ordinary activities multiplied by rate of corporation tax of 19% (2017: 20%) Effects of: Charitable activities not subject to tax Fixed asset differences Expenses not deductible for tax purposes Income not taxable in determining taxable surplus Chargeable gains / (losses) Adjust closing deferred tax to average rate of 19% Adjust opening deferred tax to average rate of 19% Deferred tax not recognised Group total tax charge for the period

On 1 April 2009, Trent & Dove Housing Limited converted from being a company limited by guarantee to a charitable organisation, a Registered Society under the Co-operative and Community Benefits Society Act. This change had the effect of mitigating tax liabilities.

62

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 10

ASSOCIATION TAX ON SURPLUS ON ORDINARY ACTIVITIES 2018 £'000

2017 £'000

Current tax on surplus on ordinary activities UK Corporation Tax at 19% (2017: 20%)

-

-

Deferred tax Origination and reversal of timing differences Effect of increase in tax rate on opening liability

-

-

Total deferred tax (see note 23)

-

-

Total tax on surplus on ordinary activities

-

-

The tax charge comprises:

The differences between the total tax charge shown above and the amount calculated by applying the standard rate of UK corporation tax to the surplus before tax is as follows: 0 £'000

0 £'000

Surplus on ordinary activities before taxation

6,246

6,028

1,187

1,206

(1,227) (130) 18 152

(1,206) -

Surplus on ordinary activities multiplied by rate of corporation tax of 19% (2017: 20%) Effects of: Charitable activities not subject to tax Fixed asset differences Adjust closing deferred tax to average rate of 19% Deferred tax not recognised Association total tax charge for the period

-

63

-

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 11

INTANGIBLE FIXED ASSETS Computer Software £'000 Cost At 1 April 2017 Additions Disposals

568 60 -

At 31 March 2018

628

Amortisation At 1 April 2017 Charged in year Released on disposals

393 96 -

At 31 March 2018

489

Net book value At 31 March 2018

139

At 31 March 2017

175

64

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 12

TANGIBLE FIXED ASSETS – HOUSING PROPERTIES – GROUP & ASSOCIATION Social Social Shared Shared housing housing ownership ownership properties properties housing housing held for under properties properties letting construction held for under letting construction

Total

£'000

£'000

£'000

£'000

£'000

Cost At 1 April 2017 Additions Schemes completed Works to existing properties Transfers Disposals

159,725 10,819 3,483 (1,270)

5,695 13,623 (10,819) (129) -

7,004 3,282 (153)

642 3,188 (3,282) 96 -

173,066 16,811 3,483 (33) (1,423)

At 31 March 2018

172,757

8,370

10,133

644

191,904

Depreciation At 1 April 2017 Charged in year Released on disposals

36,097 4,556 (1,080)

-

463 70 (13)

-

36,560 4,626 (1,093)

At 31 March 2018

39,573

-

520

-

40,093

Depreciated cost At 31 March 2018

133,184

8,370

9,613

644

151,811

At 31 March 2017

123,628

5,695

6,541

642

136,506

Expenditure on works to existing properties 2018 £'000

2017 £'000

Amounts capitalised: Replacement of components Improvements

816 2,667

713 1,472

Sub-Total

3,483

2,185

856

648

4,339

2,833

Amounts charged to Statement of Comprehensive Income Total

Freehold land and buildings with a carrying amount of £55,589,000 (2017: £39,273,000) have been pledged to secure borrowings of the Association. The Association is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

65

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 13

OTHER PROPERTY, PLANT & EQUIPMENT – GROUP Plant and Equipment

Motor Vehicles

Total

£'000

Computers and office equipment £'000

£'000

£'000

£'000

924 278 -

3,556 -

611 23 -

89 22 -

87 (16)

5,267 45 278 (16)

1,202

3,556

634

111

71

5,574

Depreciation At 1 April 2017 Charged in year Released on disposals Impairment Reversal

-

1,929 36 (92)

568 21 -

8 10 -

73 9 (16) -

2,578 76 (16) (92)

At 31 March 2018

-

1,873

589

18

66

2,546

Net book value At 31 March 2018

1,202

1,683

45

93

5

3,028

At 31 March 2017

924

1,627

43

81

14

2,689

Cost At 1 April 2017 Additions Revaluations Disposals At 31 March 2018

Investment properties

Freehold offices

£'000

The depreciation of freehold offices at 1 April 2017 includes the impairment losses of £1,439,000 which arose when the main Burton office was subject to revaluation reviews in May 2010 and February 2014. A further valuation was undertaken in January 2018 which resulted in a reversal of the prior impairment of £92,000.

Freehold offices with a carrying amount of £1,670,000 are held as security against the company’s share of the deficit on the Staffordshire County Council Pension Fund.

st

The investment properties have been valued on an annual basis since March 2014. The latest valuation was as at 31 March 2018 and was completed by Rushton Hickman Ltd.

66

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 13

OTHER PROPERTY, PLANT & EQUIPMENT – ASSOCIATION Freehold offices

14

£'000

Computers and office equipment £'000

Plant and Equipment

Motor Vehicles

Total

Cost At 1 April 2017 Additions Disposals

£'000

£'000

£'000

3,556 -

611 23 -

89 22 -

87 (16)

4,343 45 (16)

At 31 March 2018

3,556

634

111

71

4,372

Depreciation At 1 April 2017 Charged in year Released on disposals Impairment Reversal

1,929 36 (92)

568 21 -

8 10 -

73 9 (16) -

2,578 76 (16) (92)

At 31 March 2018

1,873

589

18

66

2,546

Net book value At 31 March 2018

1,683

45

93

5

1,826

At 31 March 2017

1,627

43

81

14

1,765

STOCK – GROUP AND ASSOCIATION

Completed properties for sale Work in progress Raw materials and consumables

67

2018 £'000

2017 £'000

670 215 78

214 58

963

272

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 15

DEBTORS – GROUP

Amounts falling due within one year: Rent and service charges arrears Less: Provision for bad and doubtful debts : rent and service charges arrears

Other debtors Less: Provision for bad and doubtful debts: other debtors Prepayments and accrued income

2018 £'000

2017 £'000

695

700

(568)

(558)

127

142

564 (9) 331

1,358 (1) 249

1,013

1,748

2018 £'000

2017 £'000

695

700

(568)

(558)

127

142

244 562 (9) 331

312 1,358 (1) 249

1,255

2,060

DEBTORS – ASSOCIATION

Amounts falling due within one year: Rent and service charges arrears Less: Provision for bad and doubtful debts : rent and service charges arrears

Amounts owed by group undertakings Other debtors Less: Provision for bad and doubtful debts: other debtors Prepayments and accrued income

16

SHORT TERM INVESTMENTS st

A loan has been agreed with The Housing Finance Corporation (THFC) for £31.236m. As at 31 March 2018 security was not yet in place, so the funds hadn’t been released. Short Term investments for the £31.236m were placed at the instruction of Trent & Dove, with the funds to be released once the security was finalised. th

On 15 June 2018 the charging exercise was completed, and a total sum of £29.988m was released. The remaining £1.248m is held in an Interest Service Reserve Fund and continues to be invested at the instruction of Trent & Dove.

In addition, short term investments totalling £1.213m (2017: £1.12m) are held as security against the company’s share of the deficit on the Staffordshire County Council Pension Fund.

68

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 17

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR – GROUP

Bank loans and overdrafts (see note 21) Rents received in advance Trade creditors Corporation Tax Other taxation and social security Other creditors Government grants Accruals and deferred income Multi employer benefit pension scheme liability (see note 22)

2018 £'000

2017 £'000

181 584 798 120 990 320 5,275 20

473 154 1 120 149 302 4,286 19

8,288

5,504

2018 £'000

2017 £'000

181 584 794 119 990 320 5,259 20

473 154 116 145 302 4,277 19

8,267

5,486

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR – ASSOCIATION

Bank loans and overdrafts (see note 21) Rents received in advance Trade creditors Other taxation and social security Other creditors Government grants Accruals and deferred income Multi employer benefit pension scheme liability (see note 22)

18

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR – GROUP & ASSOCIATION

Bank Loans (see note 24) Financing costs Government grants (see note 19) Disposal proceeds fund (see note 20) Multi employer benefit pension scheme liability (see note 22)

2018 £'000

2017 £'000

125,093 (242) 20,942 1,731 112

85,900 (115) 19,641 1,776 132

147,636

107,334

The loans are secured on freehold housing properties. The fixed rate loans have a weighted average interest rate of 4.12% (2017: 4.35%) and the weighted average year until which they are fixed is 2030. In addition to the above debt, at 31 March 2018 the Association had undrawn loan facilities of £16.5 million (2017: £24.5m).

The total accumulated amount of capital grant received or receivable at the balance sheet date is £22,942,000 (2017: £21,314,000).

69

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 19

DEFERRED INCOME – GOVERNMENT GRANTS

At 1 April Grants receivable Amortisation to Statement of Comprehensive Income

2018 £'000 19,943 1,628 (309)

2017 £'000 17,395 2,835 (287)

Balance at 31 March

21,262

19,943

320

302

20,942

19,641

Due within one year Due after one year st

The total value of government grants receivable to up to 31 March 2018 was £22,942,000.

20

21

DISPOSAL PROCEEDS FUND – GROUP & ASSOCIATION

At 1 April Inputs to DPF Interest accrued Recycling of grant

2018 £'000 1,776 103 7 (155)

2017 £'000 831 1,023 4 (82)

Balance at 31 March

1,731

1,776

BANK LOANS – GROUP & ASSOCIATION

Bank loans are repayable as follows: Between one and two years Between two and five years After five years

On demand or within one year `

70

2018 £'000

2017 £'000

2,636 8,912 113,039

6,531 78,969

124,587 181

85,500 -

124,768

85,500

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 22

RETIREMENT BENEFIT SCHEMES Staffordshire County Council Pension Fund The Staffordshire County Council Pension Fund is a multi-employer scheme which is administered by Staffordshire County Council under the regulations governing the Local Government Pension Scheme (LGPS), a defined benefit scheme. The most recent actuarial valuations of scheme assets were carried out as at 31 March 2016. The present value of the defined benefit obligation, the related current service cost and the past service cost were measured using the projected unit credit method.

A decision was made to close the fund to future accrual and remove the salary link to CPI + 2% effective from 1 April th 2017. This decision was made by the Board of T&D on 19 September 2016, following consultation with members. This was considered to trigger a demonstrable event requiring the change in salary assumptions, reflecting T&D’s realistic expectation for salary growth for the LGPS members, to be included in the pension deficit valuation as at March 2017 and March 2018.

Valuation at 2018 Key assumptions used: Pension Increase Rate Salary Increase Rate Discount Rate

2.2% 2.2% 2.7%

2017 2.2% 2.2% 2.6%

Mortality assumptions: Life expectancy is based on the Fund’s Vita Curves with improvements in line with the CMI 2016 model assuming the current rate of improvement has reached a peak and will converge to a long term rate of 1.00% p.a. The assumed life expectations on retirement at age 65 are: Valuation at 2018 2017 years years Retiring today: Males 21.0 21.0 Females 22.6 22.6 Retiring in 20 years: Males 22.2 22.2 Females 24.0 24.0

71

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 22

RETIREMENT BENEFIT SCHEMES

2018 £'000

2017 £'000

88 (427)

568 227 (1,119)

(339)

(324)

Recognised in other comprehensive income

(520)

(2,779)

Total cost relating to defined benefit scheme

(859)

(3,103)

Current service cost Net interest cost Plan introductions, changes, curtailments and settlements

The amount included in the Statement of Financial Position arising from the Group's obligations in respect of its defined benefit retirement benefit scheme is as follows: 2018 £'000 Present value of defined benefit obligations Fair value of scheme assets

2017 £'000

29,876 (27,089)

26,765 (23,119)

Deficit

2,787

3,646

Net liability recognised in the Statement of Financial Position

2,787

3,646

Movements in the present value of defined benefit obligations were as follows: 2018 £'000

2017 £'000

At 1 April Service cost Interest cost Contributions from scheme participants Benefits paid Effect of business combinations and disposals Changes in demographic assumptions Changes in financial assumptions Other experience

26,765 778 (525) 3,446 (593) 5

25,688 149 896 141 (448) (1,094) 3,066 (1,633)

At 31 March

29,876

26,765

72

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 22

RETIREMENT BENEFIT SCHEMES

Movements in the fair value of scheme assets were as follows: 2018 £'000

2017 £'000

At 1 April Interest income Contributions from scheme participants Contributions from the employer Contributions in respect of unfunded benefits Benefits paid Effect of business combinations and disposals Return on assets excluding amounts included in net interest

23,119 690 284 6 (525) 3,583 (68)

18,939 669 141 694 6 (448) 3,118

At 31 March

27,089

23,119

Fair value of assets 2018 2017 Equity instruments Bonds Property Cash

73% 14% 8% 5%

74% 13% 8% 5%

The Pensions Trust – Social Housing Pension Scheme The company participates in the scheme, a multi-employer scheme which provides benefits to some 500 nonassociated employers. The scheme is a defined benefit scheme in the UK. It is not possible for the company to obtain sufficient information to enable it to account for the scheme as a defined benefit scheme. Therefore it accounts for the scheme as a defined contribution scheme.

The scheme is subject to the funding legislation outlined in the Pensions Act 2004 which came into force on 30 December 2005. This, together with documents issued by the Pensions Regulator and Technical Actuarial Standards issued by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK. The scheme is classified as a ‘last man standing arrangement’. Therefore the company is potentially liable for other participating employers’ obligations if those employers are unable to meet their share of the scheme deficit following withdrawal from the scheme. Participating employers are legally required to meet their share of the scheme deficit on an annuity basis on withdrawal from the scheme.

A full actuarial valuation for the scheme was carried out with an effective date of 30 September 2014. This actuarial valuation was certified on 23 November 2015 and showed assets of £3,123m, liabilities of £4,446m and a deficit of £1,323m. To eliminate this funding shortfall, the trustees and the participating employers have agreed that additional contributions will be paid, in combination from all employers, to the scheme as follows:

73

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 22

RETIREMENT BENEFIT SCHEMES Deficit contributions Tier 1: From 1 April 2016 to 30 September 2020: st £40.6m per annum (payable monthly and increasing by 4.7% each year on 1 April) Tier 2: From 1 April 2016 to 30 September 2023: st £28.6m per annum (payable monthly and increasing by 4.7% each year on 1 April) Tier 3: From 1 April 2016 to 30 September 2026: st £32.7m per annum (payable monthly and increasing by 3.0% each year on 1 April) Tier 4: From 1 April 2016 to 30 September 2026: st £31.7m per annum (payable monthly and increasing by 3.0% each year on 1 April) Note that the scheme’s previous valuation was carried out with an effective date of 30 September 2011; this valuation was certified on 17 December 2012 and showed assets of £2,062m, liabilities of £3,097m and a deficit of £1,035m. To eliminate this funding shortfall, payments consisted of the Tier 1, 2 & 3 deficit contributions.

Where the scheme is in deficit and where the company has agreed to a deficit funding arrangement the company recognises a liability for this obligation. The amount recognised is the net present value of the deficit reduction contributions payable under the agreement that relates to the deficit. The present value is calculated using the discount rate detailed in these disclosures. The unwinding of the discount rate is recognised as a finance cost.

Present values of provision

Present value of provision

2018 £'000

2017 £'000

132

151

2018 £'000

2017 £'000

151 2 (19) (2)

161 3 (18) 5

132

151

2018 £'000

2017 £'000

2 (2)

3 5

-

8

Reconciliation of opening and closing provisions

Provision at start of period Unwinding of the discount factor (interest expense) Deficit contribution paid Remeasurements - impact of any changes in assumptions

Income and expenditure impact

Interest expense Remeasurements - impact of any changes in assumptions Costs recognised in the Statement of Comprehensive Income

74

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 22

RETIREMENT BENEFIT SCHEMES Assumptions

Rate of discount

23

2018 % per annum

2017 % per annum

1.72

1.33

2018 £'000

2017 £'000

110

103

46

7

156

110

-

-

DEFERRED TAXATION Provision for deferred taxation on investment property revaluation

Provision at start of period Recognised in Statement of Comprehensive Income

Provision at end of period

Deferred tax (asset)/liability not recognised

24

FINANCIAL INSTRUMENTS The carrying values of the Group and Association’s financial assets and liabilities are summarised by category below: Financial assets - Group

Measured at undiscounted amount receivable: Rent arrears and other debtors (see note 15) Cash

2018 £'000

2017 £'000

682 4,037

1,499 1,607

4,719

3,106

2018 £'000

2017 £'000

680 244 3,929

1,499 312 1,484

4,853

3,295

Financial assets - Association

Measured at undiscounted amount receivable: Rent arrears and other debtors (see note 15) Amounts due from group undertakings Cash

75

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 24

FINANCIAL INSTRUMENTS Financial liabilities - Group

Measured at amortised cost: Loans payable Measured at undiscounted amount payable: Trade and other creditors (see note 17)

2018 £'000

2017 £'000

125,032

85,785

2,492

897

127,524

86,682

2018 £'000

2017 £'000

125,032

85,785

2,487

888

127,519

86,673

Financial liabilities - Association

Measured at amortised cost: Loans payable Measured at undiscounted amount payable: Trade and other creditors (see note 17)

The group's income, expense, gains and losses in respect of financial instruments are summarised below: 2018 £'000 Interest income and expense Total interest income for financial assets at amortised cost 7 Total interest expense for financial liabilities at amortised cost 3,782

76

2017 £'000 10 3,736

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 25

STATEMENT OF CASH FLOWS 2018 £'000

2017 £'000

6,576

6,110

4,702 96 (691) 735 2,539 (448) 330 (92) (278)

4,469 98 (129) (474) (295) (564) 425 (82)

Adjustments for investing or financing activities: Proceeds from the sale of property, plant and equipment Government grants utilised in the year Interest payable Interest received

(1,398) (309) 3,872 (7)

(1,337) (287) 3,966 (10)

Cash generated by operations

15,627

11,890

2018 £'000 21,496 17,224

2017 £'000 16,584 11,707

38,720

28,291

Cash flow from operating activities Surplus for the year Adjustment for non-cash items: Depreciation of property, plant and equipment Amortisation of intangible assets (Increase) in stock Decrease / (Increase) in debtors Increase / (Decrease) in creditors Pension costs less contributions payable Carrying amount of property, plant & equipment disposals Impairment loss on property, plant and equipment Increase in fair value of investment property

26

FINANCIAL COMMITMENTS – GROUP & ASSOCIATION Capital commitments are as follows:

Contracted for but not provided for Approved by the directors but not contracted for

The above commitments will be financed primarily through borrowings available for draw-down under existing loan arrangements, which currently amount to £16.5m, through cash and short term investments held, totalling £35.4m.

Operating leases The future minimum lease payments under non-cancellable operating leases are as follows:

Payments due:within one year between one and five years

77

2018 £'000

2017 £'000

116 123

95 193

239

288

NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 27

HOUSING STOCK – GROUP & ASSOCIATION

Owned and managed General needs housing accommodation at social rent General needs housing accommodation at affordable rent Housing accommodation at intermediate rent Supported housing accommodation at social rent Shared ownership accommodation

28

2018 Units

2017 Units

4,451 1,116 29 188 196

4,382 1,065 42 188 151

5,980

5,828

RELATED PARTY TRANSACTIONS Tenants Serving as Board Members During the year to 31 March 2018, two tenants served as members of the Board: Mark Ashby and Sally Gibson. Their tenancies are on normal commercial terms and they are not able to use their position to derive any benefit which is not available to tenants in general.

The total value of rent and service charges receivable in the year from tenant board members was £8,557.

Investment in Subsidiary Trent & Dove Housing Limited has an investment in its subsidiary company First Housing Limited. The one ordinary share of £1 held by Trent & Dove Housing Limited was acquired on 26 March 2009 and represents the total allotted share capital as at 31 March 2018.

First Housing Limited is incorporated in England and Wales and acquired the shops of Trent & Dove Housing Limited on 30 March 2009 for the sum of £158k. First Housing continues to let and maintain shops and had a net turnover for the year of £104k (2017: £104k).

A loan of £237k (2017: £237k) has been provided by Trent & Dove to First Housing Limited. Interest is charged at variable rates, with £8k (2017: £9k) payable from First Housing Limited to Trent & Dove in the year.

Trent & Dove charged a management fee of £12k (2017: £10k) for the year to First Housing Limited for services carried out on its behalf.

29

CONTROLLING PARTY Trent & Dove Housing Limited is the ultimate controlling party of the group.

78