Agenda Document Pack - Lanarkshire Educational Trust - 18/12/2023
North Lanarkshire Council · 18 December 2023
Back to Lanarkshire Educational Trust — 18 December 2023 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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7 December 2023 Members of the Lanarkshire Educational Trust Chief Executive’s Office Archie Aitken Chief Officer (Legal & Democratic) Civic Centre, Windmillhill Street, Motherwell ML1 1AB www.northlanarkshire.gov.uk Notice is given that a Meeting of the Lanarkshire Educational Trust is to be held in the Remote Meeting, on Monday, 18 December 2023 at 10:00 AM which you are requested to attend. The agenda of business is attached. Archie Aitken Chief Officer (Legal & Democratic) Members : Clerk Name: Clare Louise McDonald Clerk Telephone: 01698 302190 Clerk Email: mcdonaldcl@northlan.gov.uk A Ballinger, A Campbell, G Currie. Page 1 of 26
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Agenda 1 Declarations of Interest In Terms of the Ethical Standards In Public Life Etc. (Scotland) Act 2000 2 Review of Annual Accounts Submit report by the Business Finance Manager providing a copy of the Annual Accounts for the period ending 31 March 2023, prior to submission to the Office of the Scottish Charity Regulator 5 - 26 3 Review of Trust Investment Management - Verbal Update Hear verbal update from the Business Finance Manager on the Review of the Trust Investment Management Page 3 of 26
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North Lanarkshire Council Report Lanarkshire Educational Trust Committee Does this report require to be approved? ☐ Yes ☒ No Ref: TO’H Date 18/12/23 Review of Annual Accounts From Thomas O’Hagan, Business Finance Manager E-mail ohagant@northlan.gov.uk Telephone 07939 281107 Executive Summary This report allows members of the Lanarkshire Educational Trust Committee to review the Trust annual accounts for the period ended 31 March 2023 prior to submission to the Office of the Scottish Charity Regulator (OSCR). The annual accounts contain no adverse external audit comments. A copy of the Trust annual accounts has to be submitted to OSCR by 31 December 2023. Recommendations It is recommended that members of the Lanarkshire Educational Trust Committee: (1) Review the Trust annual accounts for the financial year ended 31 March 2023. (2) Note a copy of the Trust annual accounts will be submitted to OSCR prior to 31 December 2023. The Plan for North Lanarkshire Priority All priorities Ambition statement (25) Ensure intelligent use of data and information to support fully evidence based decision making and future planning Programme of Work Statutory / corporate / service requirement Item 2 Page 5 of 26
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1. Background 1.1. Officers from the North Lanarkshire Council Finance Service have responsibility for preparing the Lanarkshire Educational Trust annual accounts and ensuring the accounts are properly scrutinised and signed off by the Trust’s appointed external auditors. For financial year 2022/23 the Trust’s external auditors were Audit Scotland. 2. Report 2.1. Trust Annual Accounts 2.1.1. A copy of the Trust annual accounts is attached as Appendix 1. 2.1.2. The Trust generated a surplus of £14,237 during financial year 2022/23. 2.1.3. Summary financial information for 2022/23 and the previous 3 years is highlighted below:- Trust Activity 2019/20 £ 2020/21 £ 2021/22 £ 2022/23 £ Dividends 19,714 11,430 16,844 23,713 Bank Interest 3,324 1,231 1,289 19,773 Total Income 23,038 12,661 18,133 43,486 Grant Awards 81,985 5,269 3,837 14,229 Admin Fee 15,000 15,000 15,000 15,000 Miscellaneous 78 0 40 20 Total Expenditure 97,063 20,269 18,877 29,249 Surplus / (Deficit) (74,026) (7,608) (744) 14,237 Trust Assets Cash 739,295 731,687 730,943 745,179 Investments 747,873 1,006,525 1,077,111 978,637 Total Assets 1,487,168 1,738,212 1,808,054 1,723,816 2.1.4. The Trust external auditors have a statutory duty to report to Trustees per the Charity Accounts (Scotland) Regulations 2006 if they identify any instances of:- • proper accounting records having not been kept; or • the financial statements are not in agreement with the accounting records; or • not receiving all the information and explanations require for the audit. The external auditor states in page 14 of the annual accounts that there is nothing to report in respect of these matters. Page 6 of 26
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2.1.5. Scottish charities must submit audited annual accounts to OSCR within 9 months of their financial year end date. In this regard the Lanarkshire Educational Trust annual accounts must be submitted by 31 December 2023. The submission of annual accounts to OSCR is completed via an online portal and this task is undertaken by officers within the North Lanarkshire Finance Service. 3. Measures of success 3.1. The Lanarkshire Educational Trust continues to adhere to relevant statutory financial and charity legislation. 4. Supporting documentation 4.1. Appendix 1: Lanarkshire Educational Trust Annual Accounts 2022/23. Thomas O’Hagan Business Finance Manager Page 7 of 26
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5. Impacts 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality- and-fairer-scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☐ No ☒ If Yes, have all relevant financial impacts been discussed and agreed with Finance? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts been discussed and agreed with People Resources? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts been discussed and agreed with Legal and Democratic? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ Page 8 of 26
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5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? Where the impact identifies a requirement for significant technology change, has an assessment been carried out (or is scheduled to be carried out) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☐ No ☒ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? 5.10 Armed Forces Covenant Duty Does the report require to take due regard of the Armed Forces Covenant Duty (i.e. does it relate to healthcare, housing, or education services for in-Service or ex- Service personnel, or their families, or widow(er)s)? Yes ☐ No ☒ If Yes, please provide a brief summary of the provision which has been made to ensure there has been appropriate consideration of the particular needs of the Armed Forces community to make sure that they do not face disadvantage compared to other citizens in the provision of public services. 5.11 Children’s rights and wellbeing impact Does the report contain any information regarding any council activity, service delivery, policy, or plan that has an impact on children and young people up to the age of 18, or on a specific group of these? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact and the provision that has been made to ensure there has been appropriate consideration of the relevant Articles from the United Nations Convention on the Rights of the Child (UNCRC). If Yes, has a Children’s Rights and Wellbeing Impact Assessment (CRWIA) been carried out? Yes ☐ No ☐ Page 9 of 26
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North Lanarkshire Council Educational Endowments SC028079 Annual Report and Accounts For the year ended 31 March 2023 Page 10 of 26
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Reference and administration details Charity name North Lanarkshire Council Educational Endowments Other names charity is known by Education Trust Funds Registered charity number SC028079 Charity’s principal address North Lanarkshire Council PO Box 114 Civic Centre Motherwell Postcode ML1 1AB Names of the charity trustees on date of approval of Trustees’ Annual Report Trustee name Office (if any) Dates acted if not for whole year Name of person (or body) entitled to appoint trustee (if any) 1 Elaine Kemp Chief Officer (Financial Solutions), North Lanarkshire Council (NLC) North Lanarkshire Council 2 Ann Ballinger Councillor NLC 09/06/22 > onward North Lanarkshire Council 3 Angela Campbell Councillor NLC 09/06/22 > onward North Lanarkshire Council 4 Gordon Currie Councillor NLC 09/06/22 > onward North Lanarkshire Council 5 Catherine McClymont Councillor SLC South Lanarkshire Council 6 Gavin Wylie Keatt Councillor SLC 29/06/22 > onward South Lanarkshire Council 7 Eileen Logan Councillor SLC South Lanarkshire Council Names of all other charity trustees during the period. Name Dates acted if not for whole year Agnes Duncan McGowan – Councillor NLC 01/04/22 to 09/06/22 Frank McNally - Councillor NLC 01/04/22 to 09/06/22 Trevor Douglas - Councillor NLC 01/04/22 to 09/06/22 Poppy Corbett – Councillor SLC 01/04/22 to 29/06/22 1 Page 11 of 26
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Structure, governance and management Type of governing document Statutory Instrument No. 629 The Educational Endowments (Strathclyde Region) Transfer Scheme Order 1996. Trustee recruitment and appointment The Chief Officer (Financial Solutions) of North Lanarkshire Council and the Educational Trust Committee, comprising 3 elected members from North Lanarkshire Council and 3 elected members from South Lanarkshire Council, act as Trustees for the charitable funds. Objectives and activities Charitable purposes The principal funds of the Lanarkshire Education Trust and the Marshall (Education) Trust were established to provide opportunities for educational advancement. The other educational trust funds consist mainly of prize funds and bursaries for individual schools within the North Lanarkshire area and are usually provided in the form of legacies of former school pupils or parents. Summary of the main activities in relation to these objects During the financial year 2022/23, the Trust paid grants of £21,729 in relation to educational advancement. This was offset by the repayment of £7,500 from two previously awarded grants for school’s overseas trips which had to be cancelled. The net spend on Grants during 2022/23 being £14,229. A breakdown of this total against each fund is included within the Educational Trust Funds Accounts. Achievements and performance Summary of the main achievements of the charity during the financial period The principal funds of the Lanarkshire Education Trust and the Marshall (Education) Trust were established to provide opportunities for educational advancement. The trust administers a range of grant awards reflecting the origins of trust funds, which provides grants to individuals, schools and groups/clubs under a number of award categories. The Trust funded 30 awards in 2022/23 at a cost of £21,729. 2 Page 12 of 26
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Financial review Brief statement of the charity’s policy on reserves The level of financial reserve held by North Lanarkshire Council is reviewed annually during the budget setting process. Details of surplus / deficit The trust had a surplus of £14,237 in 2022/23 and a deficit of £744 in 2021/22. This is the first surplus for several years and is principally down to an increase in interest rates. The charity has no fundraising activities, as such, their annual income is earned through investment income. Consequently, the trust’s annual income will reflect the current Interest rates and investment returns. The trust historically has funded its deficit from distributable reserves. The trust is likely to continue to incur managed deficits for a number of years, given the level of reserves. Other information Trustees Responsibilities The trustees are responsible for preparing the Trustees' Report and the financial statements in accordance with applicable law and accounting practice. The law applicable to charities in Scotland requires the trustees to prepare financial statements for each financial year which properly present the receipts and payments of the charity and which have been properly prepared from and are in agreement with the accounting records of the charity and comply with the relevant disclosure requirements. The Trustees are required to: • select suitable accounting policies and apply them consistently; and • state whether applicable accounting standards and statements of recommended practice have been followed, subject to any material departures disclosed and explained in the financial statements. The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities and Trustee Investment (Scotland) Act 2005, Charities Accounts (Scotland) Regulations 2006 and the provisions of the charity’s constitution. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The charity trustees have overall responsibility for ensuring that there are appropriate systems of controls, financial and otherwise. They are also responsible for providing reasonable assurance that: • the charity is operating efficiently and effectively; • the charitable assets are safeguarded against unauthorised use or disposition; • proper records are maintained and financial information used by the charity is reliable; • the charity complies with relevant laws and regulations. Administration On behalf of the Trustees, North Lanarkshire Council administer the fund but it does not represent assets available to the Council. The administration of the Educational Endowments trust fund is covered by North Lanarkshire Council’s financial regulations and policies. The unaudited accounts were issued on 29 June 2023 and the audited accounts were authorised for issue on 25 October 2023. Investment Policy and Performance North Lanarkshire Council invests its trust funds in high earning investments (subject to the original investment limitation parameters of the original bequest) or with North Lanarkshire Council’s Loans Funds and earn interest accordingly. It is generally the case that the accumulation of income arising from these funds will be distributed on an annual basis. 3 Page 13 of 26
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Risk Management The administration of the trust fund is covered by North Lanarkshire Council’s Risk Management Policies. Strategic Plans The administration of the trust fund is covered by North Lanarkshire Council’s Treasury Management Strategy in accordance with recognised Codes of Practice. Control Environment North Lanarkshire Council’s systems of internal control are designed to provide reasonable, but not absolute assurance against material misstatement or loss. In addition, North Lanarkshire Council’s Internal Audit Service which is an assurance function provides an independent and objective opinion on the adequacy and effectiveness of the Council’s control environment. Accounting Policies The Accounts have been prepared on a receipts and payments basis in accordance with the requirements of the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006.The accounts have been prepared on a going concern basis. Resources Expended Charitable payment comprise those costs incurred by the charity in the delivery of its activities and services for its beneficiaries. Governance costs include those associated with meeting the constitutional and statutory requirements of the charity. Audit Fee The audit fee for the year has been absorbed by North Lanarkshire Council within their annual audit fee. Declaration The trustees declare that they have approved the trustees’ report above. Signed on behalf of the charity’s trustees Signature(s) Full name(s) Elaine Kemp Position (e.g. Chair) Chief Officer (finance) North Lanarkshire Council Date 4 27 October 2023 Page 14 of 26
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Enter SC No. below SC028079 Section A Statement of receipts and payments Unrestricted funds Restricted funds Expendable endowment funds Permanent endowment funds Total funds current period Total funds last period to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ A1 Receipts Donations - Legacies - Grants - Receipts from fundraising activities - Gross trading receipts - Income from investments other than land and buildings 43,486 43,486 18,133 Rents from land & buildings - Gross receipts from other charitable activities - - A1 Sub total - 43,486 - - 43,486 18,133 A2 Receipts from asset & investment sales Proceeds from sale of fixed assets - Proceeds from sale of investments - A2 Sub total - - - - - - Total receipts - 43,486 - - 43,486 18,133 A3 Payments Expenses for fundraising activities - Gross trading payments - Investment management costs - Payments relating directly to charitable activities 14,229 14,229 3,837 Grants and donations - Governance costs: - Audit / independent examination - Preparation of annual accounts - Legal costs - Other 15,020 15,020 15,040 - A3 Sub total - 29,249 - - 29,249 18,877 A4 Payments relating to asset and investment movements Purchases of fixed assets - Purchase of investments - A4 Sub total - - - - - - Total payments - 29,249 - - 29,249 18,877 Net receipts / (payments) - 14,237 - - 14,237 744)( A5 Transfers to / (from) funds - Surplus / (deficit) for year - 14,237 - - 14,237 744)( Receipts and payments accounts Enter charity name below North Lanarkshire Council Educational Endowments For the period from Period start date Period end date to 1 April 2022 Day Month Year Day Month Year 31 March 2023 5 Page 15 of 26
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Section B Statement of balances Categories Unrestricted funds Restricted funds Expendable endowment funds Permanent endowment funds Total current period Total last period to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ 730,942 730,942 731,686 14,237 14,237 744)( - - - 745,179 - - 745,179 730,942 - - - - - - Market valuation Last year to nearest £ to nearest £ 4,204 3,444 30,874 32,614 96,725 96,894 128,268 128,016 61,963 60,582 245,438 258,500 146,592 146,304 229,402 304,674 35,171 46,082 Total 978,637 1,077,111 Cost (if available) Current value (if available) Last year to nearest £ to nearest £ to nearest £ Total - - - Amount due Last year to nearest £ to nearest £ Total - - Amount due (estimate) Last year to nearest £ to nearest £ Total - - Signed by one or two trustees on behalf of all the trustees Date of approval Elaine Kemp Expendable Endowments Expendable Endowments Fund to which asset belongs Fund to which liability relates Signature Print Name Fund to which liability relates B1 Cash funds GAM Global Diversified B2 Investments Cash and bank balances at end of year (Agree balances with receipts and payments account(s)) Cash and bank balances at start of year Details Ord Shares -Royal Bank of Scotland Investors Capital Trust Limited Scottish American Investment Co. Ltd. Merchants Trust Limited Scottish American Investment Trust F&C Fund Management / ISIS St James Place Capital plc RIT Capital Partners plc B3 Other assets B5 Contingent liabilities B4 Liabilities Details Details Details Expendable Endowments Expendable Endowments Expendable Endowments Expendable Endowments Expendable Endowments Expendable Endowments Expendable Endowments North Lanarkshire Council Educational Endowments SC028079 Details Surplus / (deficit) shown on receipts and payments account Fund to which asset belongs 6 27 October 2023 Page 16 of 26
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Section C Notes to the Accounts Individual / institution Number of grants made £ Individual 30 21,729 School Funds 0 0 School Funds -2 -7,500 14,229 C3a Trustee remuneration £ C4a Trustee expenses Number of trustees £ Transaction amount (£) Balance outstanding at period end (£) Educational Advancement - Returned awards SC028079North Lanarkshire Council Educational Endowments C1 Nature and purpose of funds (may be stated on analysis of funds worksheets) See Analysis of Restricted Funds worksheet Type of activity or project supported C2 Grants Educational Advancement Educational Advancement Total If no remuneration was paid during the period to any charity trustee or person connected to a trustee cross this box (otherwise complete section 3b) x If no expenses were paid to any charity trustee during the period then cross this box (otherwise complete section 4b) C3b Trustee remuneration - details x Authority under which paid C6 Other information The accounts have been prepared under the going concern concept on the basis that Trustees have considered it and are satisfied that the going concern concept is appropriate. C5 Transactions with trustees and connected persons Nature of relationship Nature of transaction C4b Trustee expenses - details 7 Page 17 of 26
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Additional analysis (1) 1 Donations Unrestricted funds Restricted funds Expendable endowment funds Permanent endowment funds Total current period Total last period to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ - - - - Total - - - - - - - - - - - - Unrestricted funds Restricted funds Total current period Total last period to nearest £ to nearest £ to nearest £ to nearest £ - - - - Total - - - - - - - - Unrestricted funds Restricted funds Expendable endowment funds Permanent endowment funds Total current period Total last period to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ - - - - - - - - Total - - - - - - - - - - - - Unrestricted funds Restricted funds Expendable endowment funds Permanent endowment funds Total current period Total last period to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ to nearest £ Awards to Individuals and Other Net Costs 21,729 21,729 11,837 Awards to Groups/Organisations - - - Awards to Educational Establishments - - 1,000 Returned awards from Educational Establishments - Refunded awards - Trips cancelled due to pandemic - 7,500 - 7,500 9,000- - - - - - - Total - 14,229 - - 14,229 3,837 - - - - - - 4 Payments relating directly to charitable activities SC028079North Lanarkshire Council Educational Endowments Analysis of receipts and payments 3 Gross receipts from other charitable activities 2 Grants 8 Page 18 of 26
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Additional analysis (2) Unrestricted fund 1 - enter name of fund below Unrestricted fund 2 - enter name of fund below Unrestricted fund 3 - enter name of fund below Unrestricted fund 4 - enter name of fund below Total unrestricted funds Total unrestricted funds last period Receipts Donations - Legacies - Grants - Receipts from fundraising activities - Gross trading receipts - buildings - Rents from land & buildings - Gross receipts from other charitable activities - Sub total - - - - - - - Receipts from asset & investment sales Proceeds from sale of fixed assets - Proceeds from sale of investments - Sub total - - - - - - Total receipts - - - - - - - Payments Expenses for fundraising activities - Gross trading payments - Investment management costs - Payments relating directly to charitable activities - Grants and donations - Governance costs: - Audit / independent examination - Preparation of annual accounts - Legal costs - - - Sub total - - - - - - - Payments relating to asset and investment movements Purchases of fixed assets - Purchase of investments - Sub total - - - - - - - Total payments - - - - - - - Net receipts / (payments) - - - - - - Transfers to / (from) funds - Surplus / (deficit) for year - - - - - - - Nature and purpose of funds North Lanarkshire Council Educational Endowments 5 Breakdown of unrestricted funds SC028079 9 Page 19 of 26
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Additional analysis (3) Restricted fund 1 - enter name of fund below Restricted fund 2 - enter name of fund below Restricted fund 3 - enter name of fund below Restricted fund 4 - enter name of fund below Lanarkshire Educational Trust Marshall Trust Lanarkshire Other Educational Trusts Total restricted funds Total restricted funds last period Receipts Donations - - Legacies - - Grants - - Receipts from fundraising activities - - Gross trading receipts - - Income from investments other than land and buildings 16,510 26,713 263 43,486 18,133 Rents from land & buildings - - Gross receipts from other charitable activities - - Sub total 16,510 26,713 263 - 43,486 18,133 - Receipts from asset & investment sales Proceeds from sale of fixed assets - Proceeds from sale of investments - Sub total - - - - - - Total receipts 16,510 26,713 263 - 43,486 18,133 - Payments Expenses for fundraising activities - - Gross trading payments - - Investment management costs - - Payments relating directly to charitable activities 5,390 8,839 - 14,229 3,837 Grants and donations - - Governance costs: - - Audit / independent examination - - Preparation of annual accounts - - Legal costs - - Other 5,702 9,318 15,020 15,040 - - Sub total 11,092 18,157 - - 29,249 18,877 - Payments relating to asset and investment movements Purchases of fixed assets - Purchase of investments - Sub total - - - - - - - Total payments 11,092 18,157 - - 29,249 18,877 - Net receipts / (payments) 5,418 8,556 263 - 14,237 744)( Transfers to / (from) funds - Surplus / (deficit) for year 5,418 8,556 263 - 14,237 744)( - Nature and purpose of funds The principal funds are the Lanarkshire Educational Trust and the Marshall (Education) Trust which were established under the Educational Endowments (Scotland) Acts 1928 to 1935 to provide opportunities for educational advancement. These funds are accessible to individuals, groups or educational establishments of both North and South Lanarkshire and are administered by the joint Educational Trust Committee in line with Staturory Instrument No. 629 The Educational Endowments (Strathclyde Region) Transfer Scheme Order 1996. North Lanarkshire Council Educational Endowments 6 Breakdown of restricted funds SC028079 10 Page 20 of 26
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Accounting Policies Basis of accounting The accounts have been prepared on a Receipts and Payments basis in accordance with the requirements of the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. Resources expended Charitable payments comprise those costs incurred by the charity in the delivery of its activities and services for its beneficiaries. Governance costs include those associated with meeting the constitutional and statutory requirements of the charity. 11 Page 21 of 26
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Independent auditor’s report to the trustees of North Lanarkshire Council Educational Endowments and the Accounts Commission Reporting on the audit of the financial statements Opinion on financial statements I certify that I have audited the financial statements in the statement of accounts of North Lanarkshire Council Educational Endowments for the year ended 31 March 2023 under Part VII of the Local Government (Scotland) Act 1973 and section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005. The financial statements comprise the Statement of Receipts and Payments, the Statement of Balances, and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and a receipts and payments basis In my opinion the accompanying financial statements: • properly present the receipts and payments of the charity for the year ended 31 March 2023 and its statement of balances at that date; and • have been prepared in accordance with the requirements of the Charities and Trustee Investment (Scotland) Act 2005, and regulations 9(1),(2) and (3) of The Charities Accounts (Scotland) Regulations 2006. Basis for opinion I conducted my audit in accordance with applicable law and International Standards on Auditing (UK) (ISAs (UK)), as required by the Code of Audit Practice approved by the Accounts Commission for Scotland. My responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of my report. I am independent of the charity in accordance with the ethical requirements that are relevant to my audit of the financial statements in the UK including the Financial Reporting Council’s Ethical Standard, and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Responsibilities of the trustees for the financial statements The trustees are responsible for the preparation of financial statements that properly present the receipts and payments of the charity, and for such internal control as the trustees determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. 12 Page 22 of 26
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Auditor’s responsibilities for the audit of the financial statements My objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. I design procedures in line with my responsibilities outlined above to detect material misstatements in respect of irregularities, including fraud. Procedures include: • using my understanding of the local government sector and charity sector to identify that the Local Government (Scotland) Act 1973, Charities and Trustee Investment (Scotland) Act 2005 and The Charities Accounts (Scotland) Regulations 2006 are significant in the context of the charity; • inquiring of the Trustees as to other laws or regulations that may be expected to have a fundamental effect on the operations of the charity; • inquiring of the Trustees concerning the charity’s policies and procedures regarding compliance with the applicable legal and regulatory framework; • discussions among my audit team on the susceptibility of the financial statements to material misstatement, including how fraud might occur; and • considering whether the audit team collectively has the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The extent to which my procedures are capable of detecting irregularities, including fraud, is affected by the inherent difficulty in detecting irregularities, the effectiveness of the charity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud are inherently more difficult to detect than irregularities that result from error as fraud may involve collusion, intentional omissions, misrepresentations, or the override of internal control. The capability of the audit to detect fraud and other irregularities depends on factors such as the skilfulness of the perpetrator, the frequency and extent of manipulation, the degree of collusion involved, the relative size of individual amounts manipulated, and the seniority of those individuals involved. 13 Page 23 of 26
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A further description of the auditor’s responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website www.frc.org.uk/auditorsresponsibilities. This description forms part of my auditor’s report. Reporting on other requirements Other information The trustees are responsible for the other information in the statement of accounts. The other information comprises the Trustees’ Annual Report. My responsibility is to read all the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If I identify such material inconsistencies or apparent material misstatements, I am required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard. My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon except on the Trustees’ Annual Report to the extent explicitly stated in the following opinion prescribed by the Accounts Commission. Opinions prescribed by the Accounts Commission on the Trustees’ Annual Report In my opinion, based on the work undertaken in the course of the audit, the information given in the Trustees' Annual Report for the financial year for which the financial statements are prepared is consistent with the financial statements and that report has been prepared in accordance with The Charity Accounts (Scotland) Regulations 2006. Matters on which I am required to report by exception I am required by The Charity Accounts (Scotland) Regulations 2006 to report to you if, in my opinion: • proper accounting records have not been kept; or • the financial statements are not in agreement with the accounting records; or • I have not received all the information and explanations I require for my audit. 14 Page 24 of 26
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I have nothing to report in respect of these matters. Use of my report This report is made solely to the parties to whom it is addressed in accordance with Part VII of the Local Government (Scotland) Act 1973 and for no other purpose. In accordance with paragraph 108 of the Code of Audit Practice, I do not undertake to have responsibilities to members or officers, in their individual capacities, or to third parties. Pauline Murray Senior Audit Manager Audit Scotland 4th Floor 102 West Port Edinburgh EH3 9DN Pauline Murray is eligible to act as an auditor in terms of Part VII of the Local Government (Scotland) Act 1973. 15 27 October 2023 Page 25 of 26
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