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101 QUEEN VICTORIA STREET LONDON EC4V 4EH
THE SALVATION ARMY INTERNATIONAL HEADQUARTERS
WEBSITE: WWW.SALVATIONARMY.ORGTELEPHONE: +44 (0)20 7332 0101
MISSION STATEMENT
International Headquarters exists to
support the General as he/she leads
The Salvation Army to accomplish
its God-given worldwide mission to
PREACH THE GOSPEL of Jesus Christ
and MEET HUMAN NEEDS in his
name WITHOUT DISCRIMINATION
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THE SALVATION ARMY INTERNATIONAL TRUST
TRUSTEE’S REPORTThe Trustee is pleased to present the annual report for The Salvation Army International Trust for the year ended 31 March 2018.C
ON
TEN
TS
The General, acting under powers contained in The Salvation Army Act 1980, established The Salvation Army International Trust to further the worldwide work of The Salvation Army. The Salvation Army International Trustee Company (SAITCo), a company limited by guarantee, was formed and appointed as the ordinary Trustee of the Trust. The directors of the Trustee Company are thus effectively the charity’s trustees.
THE SALVATION ARMY INTERNATIONAL TRUST Registered Charity No 1000566 Trust Settlement Deed dated 21 September 1990
THE SALVATION ARMY INTERNATIONAL TRUSTEE COMPANY – ORDINARY TRUSTEE Company Registration No 2538134
The General of The Salvation Army, as founder of the Trust, specifies the qualifying offices and the experts for SAITCo. Both the qualifying offices’ holders and the experts make application for membership of SAITCo with consent to become directors and are accepted by the Board of Directors of the Trustee Company.
All new directors follow teaching modules prepared specifically for The Salvation Army on its constitution and the duties and responsibilities of directors. In addition individual directors follow external courses.
STRUCTURE, GOVERNANCE AND MANAGEMENT
Structure, Governance and Management 2
Objectives and Activities 6
Achievements and Performance 7
Financial Review 33
Statement of Trustee’s Responsibilities 41
The Independent Auditor’s Report 42
Statement of Financial Activities 44
Balance Sheet 45
Cash Flow Statement 46
Notes to the Accounts 47
Commissioner Birgitte Brekke-Clifton SRN from 1 March 2013
Commissioner Lyndon Buckingham from 3 August 2018
Commissioner Robert Donaldson BSc, LTh, P Dip, MInstD (NZ) from 10 March 2017
Commissioner Gillian Downer from 1 June 2013
Commissioner Merle Heatwole BSc from 2 November 2015
Commissioner Johnny Kleman from 1 January 2018
Commissioner Lalzamlova BA from 1 April 2013 to 30 June 2017
Commissioner Benjamin Mnyampi from 1 August 2016
Commissioner Brian Peddle from 1 September 2014 to 2 August 2018
Commissioner Charles Swansbury BA, MBA from 1 June 2014 to 31 December 2017
Commissioner Mark Tillsley BA, MSc, PhD from 11 May 2018
Commissioner Alistair Venter from 29 September 2017
Commissioner John Wainwright from 1 May 2013 to 30 March 2018
Dr Matthew Carpenter BA, MBA, DBA, MCMI from 1 July 2014
Ms Elizabeth Edwards BSc (Hons), FRICS from 1 May 2013
Mr Peter King Solicitor, MA from 1 May 2013
Mr Robert Lister from 1 January 2016
Mr David A. Mayes from 1 May 2013
DIRECTORS
PRINCIPAL OFFICERS
Commissioner John Wainwright Managing Director to 30 March 2018
Commissioner Merle Heatwole BSc Managing Director from 1 April 2018
Dr Matthew Carpenter BA, MBA, DBA, MCMI Company Secretary
Miss Karen Dare Chief Accountant
BANKERS
HSBC Bank plc
60 Queen Victoria Street
London EC4N 4TR
National Westminster Bank
38 Strand
London W2CN 5JB
Reliance Bank Limited
Faith House, 23-24 Lovat Lane
London EC3R 8EB
SOLICITORS AUDITORS INVESTMENT MANAGER
Slaughter and May
1 Bunhill Row
London EC1Y 8YY
BDO LLP
2 City Place, Beehive Ring Road
Gatwick, West Sussex RH6 0PA
Sarasin & Partners LLP
Juxon House
100 St Paul’s Churchyard
London EC4M 8BU
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THE SALVATION ARMY INTERNATIONAL TRUST exists to further the work of The Salvation Army, which is to advance the Christian religion and meet human need as and where it occurs throughout the world, and support the work of International Headquarters (IHQ). IHQ is responsible for coordinating the international work and overseeing strategy.
The Salvation Army is, for administrative purposes, divided into autonomous territories (generally by region or country). Each territory is governed, through local registration(s), in accordance with the applicable local laws and The Salvation Army International Trust works with and through these separate legal entities. However, The Salvation Army remains under the oversight, direction and control of the General of The Salvation Army, as set out in greater detail in The Salvation Army Act 1980.
RELATED PARTY ENTITIESThe Salvation Army Retired Officers Allowance SchemeRegistered Charity 1153681Declaration of Trust dated 13 December 2012
The Salvation Army Retired Officers Allowance Scheme is a separately registered charity that is administered by SAITCo as the trustee.
The objects of The Salvation Army Retired Officers Allowance Scheme are to relieve the poverty of retired officers and the financial hardship amongst elderly retired officers of The Salvation Army anywhere in the world.
The Salvation Army in the United Kingdom and the Republic of Ireland
The work of The Salvation Army in the United Kingdom and the Republic of Ireland is directed by the United Kingdom Territory with the Republic of Ireland, with resources provided through Trusts administered by The Salvation Army Trustee Company. The two principal Trusts of this territory are The Salvation Army Trust and The Salvation Army Social Work Trust.
Reliance Bank Limited
The banking company, Reliance Bank Limited, in which The Salvation Army International Trust holds a 51% interest, is shown as a Joint Venture with The Salvation Army Trust (UK Territory), holding a 49% interest:
The Salvation Army International Trust 51%The Salvation Army Trust 49%
Reliance Bank Limited provides banking facilities to The Salvation Army and the general public. The Bank offers transactional banking services to more than 35 Salvation Army territories, providing a vital ‘safe haven’ for project funds and IHQ operational grants and a secure platform for international fund transfers for the global Army. The Bank offers these territories a comprehensive product range including Current Accounts and Fixed Interest Products in GBP, USD and EUR as a UK domiciled Bank regulated by the Prudential Regulation Authority (Bank of England).
During the present reported financial year, 75% of the net taxable profits of the Bank have been donated to support equally the mission of the Army internationally (The Salvation Army International Trust) and in the United Kingdom (The Salvation Army Trusts).
The Salvation Army International Trust does not control the company, a Nominations Committee comprising Non-Executive Directors of the Bank recommends the appointment of Bank Directors to the board. The investment in the Joint Venture by The Salvation Army International Trust is shown at cost, with donations received included under Income in the Statement of Financial Activities.
Reliance Bank, in common with all banks, faces a number of risks such as credit risk, interest rate risk, risk arising from holding foreign currencies, market risk and operational risk. Policies are in place to ensure that Reliance Bank’s exposure to these risks is monitored and controlled.
GOVERNANCEThe Salvation Army International Trust utilises a committee structure to supervise its operations. The Trustee Company Board of Directors, including four Non-Executive Directors, delegates day-to-day financial management decisions to the International Finance Council and the International Business Board within clearly defined parameters. The terms of reference for subsidiary boards and the minutes of all meetings of these boards are reviewed by the Directors
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on a regular basis. During 2016/17, a specific review of the efficiency and effectiveness of subsidiary board structures was undertaken with amendments made in effect during 2017/18 seeking to expose middle management to a greater role in decision making, further distribute authority and increase external scrutiny. Planning is well advanced for a further governance review during 2018/19 involving an external consultant and including a review of SAITCo board performance and effectiveness as well as benchmarking to good governance practice as outlined within the third edition of the Charity Governance Code released in July 2017. The Trust already embraces many governance activities outlined within the Code such as conducting board induction and training, managing potential or actual conflicts of interest and regularly reviewing terms of reference for subsidiary boards with opportunity for further development in areas such as formal monitoring of Board skills and performance.
A well-established Internal Audit Department also carries out a cycle of reviews of the systems in operation within IHQ and in all countries where The Salvation Army is working and a sound framework of internal controls and strong financial management systems are in place, supported by a manual of International Financial and Accounting Standards for The Salvation Army issued from IHQ. A project is also underway to roll out cloud-based accounting software to all financially supported territories which will enable more regular and more detailed reporting of key financial indicators from territories to IHQ.
An Audit Committee meets on a quarterly basis, is chaired by a Non-Executive Director of SAITCo, and comprises a minimum of three members none of whom hold executive responsibility for management of the Trust. The Committee holds delegated responsibility on behalf of SAITCo for continual review of the financial management and internal controls of the Trust and holds a direct line of communication to the external auditor.
REMUNERATIONThe Trustee is committed to ensuring a proper balance between paying staff to attract and retain the best people for the job and careful management of charitable funds.
Management remuneration policies and practices within the Trust are reviewed periodically by SAITCo with day-to-day decisions delegated to the Employee Review Board and Job Grading Panel within clearly defined parameters.
Posts are graded between evenly distributed salary points with the highest point in a salary band approximately 10% higher that the lowest point, though this can vary depending on the nature of the post. The median of the band is the ‘market average’ salary for this type of post as identified through benchmarking to comparable roles in other
organisations. New staff members are usually appointed at the lower to median end of the band, depending on experience. Post holders can progress up to the next salary point within their band, subject to satisfactory completion of a performance appraisal.
Cost of living increases are also awarded periodically to all staff by SAITCo with an assessment made within the annual budget setting process to determine any proposed inflationary adjustment with reference to the Consumer Price Index and the financial position of the Trust.Further remuneration disclosures for the Trust for this reporting period are shown within Note 13 to the Accounts.
MODERN SLAVERY ACTThe Salvation Army is very active in bringing practical assistance to those whose lives have been affected by the evil of modern slavery and as such is sensitive to the danger of inadvertently finding itself falling short of its own beliefs and standards in this regard as well as the standards set out in the UK Government’s Modern Slavery Act 2015. The Modern Slavery Act 2015 compliance statement for SAITCo can be accessed at http://www.salvationarmy.org/ihq/modernslaveryact2015 and provides details of the variety of measures undertaken by the Trustee to avoid and reduce the risk of inadvertently supporting modern slavery in any way.
FUNDRAISINGSection 162a of the Charities Act 2011 requires charities to make a statement regarding fundraising activities. Although the Trust does not actively undertake widespread fundraising from the general public, the legislation defines fund raising as ‘soliciting or otherwise procuring money or other property for charitable purposes’. Such amounts receivable are presented in the Accounts as ‘Other Donations and Legacies’.
In relation to the above the Trustee confirms that no fundraising activity has been taken by the Trust, or by anyone acting on its behalf, that no fundraising standards or scheme for fundraising regulation have been subscribed to by the Trust, or by anyone acting on its behalf, that no complaints in relation to fundraising activities have been received and that any solicitations are managed internally, without involvement of commercial participators or professional fundraisers.
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OBJECTIVES AND ACTIVITIES
Public Benefit The charity is operating for the public benefit and in keeping with the organisation’s mission statement. In setting and reviewing the Trust’s aims and objectives and planning future activities, the Trustee pays due regard to the guidance issued by the Charity Commission on public benefit. The main activities of the charity are:
●● To continue the advancement of the Christian religion through evangelistic outreach
●● To continue to provide financial assistance to The Salvation Army where needed
●● To provide effective leadership and share knowledge and expertise through the strategic deployment of personnel
●● To respond to and help meet the needs arising from major crises
●● To strengthen The Salvation Army’s capacity to support poor and marginalised people who need access to quality primary health care services as close to the family as possible
●● To take action to combat the massive and growing evil of sexual trafficking and to create awareness of social injustice in the world.
A breakdown of expenditure per these main charitable activities of the Trust is presented at Note 9 in the Accounts. This shows a significant outlay on funding assistance to Salvation Army territories (under the second objective listed above) recognising that such grants also aid fulfilment of the other stated objectives as Salvation Army territories provide a wide range of local church/social programmes having received the IHQ funding necessary to maintain day to day operations.
Specific aims for each of the main activities of the Trust during the reporting period are outlined in the sections below. The activities of the charity are rendered without discrimination and for the benefit of all people in need.
STRENGTHEN THE SALVATION ARMY’S CAPACITY TO SUPPORT POOR AND MARGINALISED PEOPLE WHO NEED ACCESS TO QUALITY PRIMARY CARE SERVICES
World Mission p8
Assistance to Salvation Army Territories p12
International Personnel Training and Development p16
Crisis Relief p20
Health Services for the poorest people p24
Fighting against sexual trafficking and for social justice p28
ACHIEVEMENTS AND PERFORMANCE1
2
3
4
5
6
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1WORLDMISSION
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communities. The programme began in January 2017 with a live-streamed launch event and received enough positive feedback that the initial one-year schedule was extended, taking it up to at least the end of 2018.
At the heart of The Whole World Mobilising are the website and app provided by IHQ that promote interactive responses. Regular blog updates give examples of a variety of ministries, including how people around the world are taking up General André Cox’s challenge for The Salvation Army around the world to be a force for ‘good, change and positive transformation’.
The main event of the 2017 Mobilising initiative was a celebration day in central London in October. Based at Regent Hall Corps (church), the event recognised the many ways in which people around the world have responded to the General’s call to find creative ways to meet needs in and take the gospel message to their communities. Led by General André Cox, the day included participation by ensembles from the UK and many IHQ officers and employees.
Two worship meetings sandwiched a spectacular march of witness through central London – along Regent Street and through Piccadilly Circus – to Trafalgar Square, where hundreds of members of the public stopped to watch and listen as the gospel message was presented in word and music.
After returning to Regent Hall, the General spoke about the innovative and imaginative ways in which people are reaching out to their neighbourhoods. He reminded Salvationists and friends: ‘God calls us to be a force for transformation in every community … The call is to go! To go out into the world, not remaining hidden in our halls.’
Specific AimsWorld Mission objectives are to encourage and enable people linked to The Salvation Army to reach out into their communities with spiritual and practical support, to offer online resources to Salvationists and friends around the world and so create a supportive network through which people can share in prayer and encouragement and for the General and other international leaders to visit Salvationists and friends around the world providing opportunities for increased publicity and offering encouragement and challenge.
AchievementsTHE WHOLE WORLD MOBILISING is a well-resourced global initiative that encourages and enables people linked with The Salvation Army to move out of their halls and into their
OVERALL OBJECTIVE To continue the advancement of the Christian religion through evangelistic outreach.
Open-air witness in Trafalgar Square, London, UK at the Whole World Mobilising celebration day
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Throughout the Whole World Mobilising celebration day, it was made clear that the meetings were not only for those who were physically present, but – through online participation – for the whole world. The two meetings, the march and the open-air meeting were all streamed live via the Mobilising website and Facebook. The outside events were supported from a studio created for the occasion at Regent Hall, which also presented interviews with people who had played a part in the Mobilising initiative.
Comments from people watching the stream included: ‘I’m watching from Saudi Arabia. God bless all The Salvation Army.’ ‘Morning from Hong Kong. We marched out yesterday afternoon at Causeway; one of the busiest parts of Hong Kong. Excited to watch the marching in London.’ ‘Watching in New Zealand, thank you for the opportunity to share.’ ‘Prayer meeting this morning at 7am at Conception Bay South Corps in Newfoundland, Canada. Prayed for the whole world.’ ‘Wonderful words from our General. It’s great that I could watch live from Hyderabad, India.’ One person in Scotland celebrated being part of a meeting for the first time in 11 months, having been unable to attend a corps due to illness.
Salvationists watched the stream together with their families and collectively at corps and headquarters. At Kuwait Corps (Middle East Region), the congregation gathered
and watched the stream together. Major Heather Grinsted wrote: ‘We are joining with you from Kuwait. We have sung along, listened to the Word and prayed together. One Army. Blessings.’
Throughout the year The Whole World Mobilising office has received stories from around the world of Salvationists and friends reaching out to their communities with practical and spiritual assistance.
In The Salvation Army’s Zambia Territory, Salvationists and friends are engaging with their neighbours and putting their faith into action. In a blog post the territory reports: ‘We marched through neighbourhoods with the band and songsters [choir], visited markets and trading places and shared the gospel on a one-to-one basis ... There was also
Live streaming: studio interview during the Whole World Mobilising celebration day
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a request that we preach on Sunday morning in the market permanently. The traders felt that since they have to conduct business on Sunday mornings, the Church can come to them so they can still gather with other believers and hear the Word of God.’
In The Salvation Army’s South America East Territory a number of initiatives in Argentina and Paraguay were highlighted to The Whole World Mobilising office.
Every Saturday afternoon, teachers and leaders from Santa Fe Corps in Argentina shared the Word of God with children and parents in Escuelita Biblica Barrio el Pozo (at the Plaza Espinillo). A group from the Santiago del Estero Corps offered food, support and encouragement to patients and visitors at a hospital. In Asunción, Paraguay, the corps organised a fun afternoon of games and activities for children, providing a safe, friendly place to play while also giving the young people the opportunity to learn more about the love of God.
Looking beyond the Whole World Mobilising initiative, one of the responsibilities for both the General and the Chief of the Staff is to travel the world, meeting Salvationists and friends, providing encouragement and challenge. They usually do this separately (except for major international gatherings such as an international congress) but Mobilize, the Newfoundland and Labrador 2017 Divisional Congress and Commissioning had the unusual honour of hosting General André Cox and Commissioner Silvia Cox (World President of Women’s Ministries) as well as the Chief of the Staff (Commissioner Brian Peddle) and Commissioner Rosalie Peddle (World Secretary for Women’s Ministries). ‘We are just accompanying the Peddles this weekend,’ the
General said with a smile as the Chief and Commissioner Rosalie – both native Newfoundlanders – were warmly welcomed home.
During the visit, the Chief of the Staff laid a wreath on behalf of The Salvation Army during a Memorial Day service of remembrance for the many Newfoundlanders who lost their lives in the First World War battle at Beaumont Hamel – in the Somme – on 1 July 1916. The international leaders also attended a reception at Government House, hosted by the Honourable Frank F. Fagan, Lieutenant Governor of Newfoundland and Labrador.
After enrolling 49 senior and junior soldiers at the Sunday morning holiness meeting, the General told the congregation: ‘God is still calling the courageous! Our lives are to count for something … God wants to use us to have an impact for good in this world.’
Key Statistics●● Online streaming of the Whole World Mobilising
celebration day in central London attracted more than 64,000 ‘viewers’ with Facebook comments shared from more than 40 countries. Each viewer could be more than one person, as people gathered to watch together at a number of Salvation Army centres.
●● Between them, the General and the Chief of the Staff visited The Salvation Army in 26 countries from 1 April 2017 to 31 March 2018 – bringing encouragement and challenge to many thousands of Salvationists and friends.
Future PlansThe General and the Chief of the Staff will continue to travel around The Salvation Army world, engaging with Salvationists, friends, supporters and people of influence. On 3 August 2018, General André Cox retired and was succeeded by Commissioner Brian Peddle who was elected General at a High Council of senior Salvation Army leaders held in London, UK in May 2018. The Salvation Army will seek new and innovative ways to share the gospel message through online means (including social media) and also by providing resources to enable local outreach. The Whole World Mobilising initiative will remain active until at least the end of 2018.
Flying the flag: march of witness at the Whole World Mobilising celebration day
Sharing the gospel: Sunday morning market ministry in Zambia
2ASSISTANCE TOSALVATION ARMY
TERRITORIES
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OVERALL OBJECTIVE To continue to provide financial assistance to The Salvation Army where needed.
Specific AimsInternational Development Services (IDS), based at IHQ, aims to provide both financial and technical support to community projects and programmes across the world. In an effort to increase global accountability in projects, IDS aimed to complete development of a new database during 2017/18 to enable multiple enhancements in general management of projects informed by the International Aid Transparency Initiative. Alongside this, a key focus was to grow internal and external partnerships as well as maintain support to territories in their journey towards financial independence.
AchievementsMore than 580 project proposals were approved at IHQ during 2017/18 for implementation worldwide to support communities. The IDS team, while continuing to work with territories to encourage sustainable, long-term positive change in communities, finalised and rolled out the new HIVE database for community, institutional and emergency projects. Territories were invited to test the database and submit feedback to enable its improvement. The following examples illustrate the significant, transformative work supported by the IDS team:
GREECE: The European refugee crisis continues to impact and inform the work of The Salvation Army in the Italy and Greece Command. In Athens, the Army is providing assistance to both refugees and asylum-seeking families in a complex, transitional context. Strong partnerships with other organisations and agencies have been vital in enabling the Army to play an effective role within the wider coordinated efforts in the country. During the year under review, AMURTEL Greece – a ‘perinatal’ mother and baby organisation – joined forces with The Salvation Army in Athens to provide breastfeeding support and nutrition assistance to nursing mothers, and their children. The expertise of the maternal health professionals from AMURTEL is adding significant value to the work of the Army for this group of vulnerable people.
AMURTEL workshop on hygiene and bottle sterilisation in Athens, Greece
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AFRICA: In December 2017, delegates from 17 African territories met in Tanzania to launch The Salvation Army’s Community Development Strategy for Africa. The strategy focuses on building capacity and resourcing with four keynote objectives:
1. Strengthening relationships: increasing confidence in using participatory facilitation for building relationships and achieving an increased number of sustainable community engagement initiatives.
2. Project management and strategic planning: increasing capacity to manage projects and systems for programme effectiveness.
3. Thematic expertise: offering continuously improved guidance on thematic areas.
4. Strengthened partnerships: enhancing partnership working between the 17 African territories and commands, IHQ and eight support offices to improve community engagement across Africa.
In the strengthening of these four areas, there should be increased cohesion of community development work throughout Africa.
HAITI: The Community Action Team (CAT) in Desruisseaux was one of many formed across Haiti in 2013, in order to support the development of the community. In October 2016, in the days before Hurricane Matthew hit land, the CAT walked through the community to find vulnerable individuals who required assistance. As a result, 150 people slept in the corps building for one night and were protected from the hurricane. The CAT team is actively involved in follow-up work with those affected by Hurricane Matthew. During the year under review, the Desruisseaux CAT continued to offer vital support to farmers who lost crops due to the hurricane, actively engaging in longer-
term projects to help the farmers’ livelihoods recover and the community get back on its feet. The CAT also engages in other activities such as community cleaning and sanitation work, hosting conferences on sexual health and parental responsibilities, horticulture and manuring of gardens, and bringing drinking water into the community.
SOUTH ASIA: Fifty-nine delegates from India South Eastern and India South Western Territories came together for teaching on the Learning Pathways approach during a two-day workshop led by IDS in December 2017. Learning Pathways is a method of self-motivated learning, developed within IDS, which enables participants to establish their own learning targets and to set out an individualised route towards achieving those targets. The method was developed in recognition of the need for capacity building among individuals tasked to work on community projects and potential hurdles that conventional training courses may pose, such as time, expense and distance from training institutions. The Learning Pathways journey encourages participants to utilise the support and knowledge of the people and resources around them, helping them to learn as they carry out their duties
Salvation Army hall in Desruisseaux, Haiti, where 150 people sheltered during Hurricane Matthew and long-term reconstruction support is ongoing
BUILDING PARTNERSHIPS BETWEEN DEVELOPMENT OFFICESAND FOSTERING STRONG RELATIONSHIPS BY ENCOURAGING CAPACITY BUILDING
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BUILDING PARTNERSHIPS BETWEEN DEVELOPMENT OFFICESAND FOSTERING STRONG RELATIONSHIPS BY ENCOURAGING CAPACITY BUILDING
Learning Pathways workshop at Nagercoil, India
Key Statistics ●● The Trust paid grants and donations to Salvation Army
territories totalling £25.73 million during the year (see Note 10 in the Accounts).
●● 585 project proposals were approved at IHQ during 2017/18 for implementation worldwide to support communities.
Future PlansOver the next year, IDS will focus on building partnerships between development offices and fostering strong relationships by encouraging capacity building within territories and advancing initiatives such as the Africa Strategy Project, Asia Learning Forum and Learning Pathways training programme. Continued development of the new HIVE database and its full adoption and use by all Salvation Army project offices, will facilitate the smooth and effective progress of projects through the management cycle.
CHINA: In Yunnan Province, China, a microcredit programme was successfully completed with the use of greenhouses in Ninglang county. Twenty households were provided with loans in order to build greenhouses for the production of seasonal and organic vegetables. The first repayment of these loans was used to fund further microcredit activities including the production of Chinese herbs. The prices set for vegetables in the local markets have been favourable and participating families have reported an increase in their household income, even with repayment of the loan.
3PERSONNEL TRAININGINTERNATIONAL
AND DEVELOPMENT
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AchievementsA keynote event during the year has been formation of the International Officer Training and Leader Development Council (IOTALDC). This draws together key officers from around the world with a wide-ranging agenda. The council will hold an important role in terms of policy development, revision of Orders and Regulations for the Training of Salvation Army Officers and promotion of resource-sharing, while day-to-day oversight of training and leader development remains a territorial responsibility. Work projects for the council include; review and clarification of territorial capability frameworks, review of current training policies and systems, promotion and development of standards for training officers, and ensuring emphasis on Salvation Army distinctives and spiritual formation throughout the training process. Other key developments during the year are as follows:
SENIOR LEADERS’ ORIENTATION: When personnel are appointed to senior leadership roles in territories (most notably chief secretaries and territorial secretaries for women’s ministries) they undergo an orientation course at IHQ. A review of the current course content suggested several practical issues concerning timing, contextual relevance, and significant existing ‘gaps’ in leader development skills. A revised 10-day Leaders’ Orientation Conference was therefore formulated as one component of the full package of support offered to the wider target group of territorial leaders, including territorial commanders and territorial presidents of women’s ministries.
Chief of the Staff Commissioner Brian Peddle welcomes delegates to leadership orientation training at IHQ
.
Specific AimsInternational personnel training and development objectives for 2017/18 included review of the orientation training offered at IHQ to new leadership in territories, offering support to training colleges around the world as they train officer cadets for culturally relevant ministry, and operation of the International College for Officers as a means to nurture personal holiness and spiritual leadership and encourage a renewed sense of mission and purpose among Salvation Army officers.
OVERALL OBJECTIVETo provide effective leadership and share knowledge and expertise through the strategic deployment of personnel.
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The orientation conference now occurs twice a year, with a new workshop approach providing senior leaders within the Army with something akin to what senior executives in secular business receive, organised around four main content-groupings: personal leadership, team/organisational leadership, governance frameworks and issues, and management.
High-quality external presenters have been secured. Some individual tailoring has been introduced, with self-directed/self-selected learning components based on what individual leaders may have already experienced in other contexts. The orientation process includes commitments to post-orientation elements including implementation of plans developed during the Conference, line management support, a selected coach/mentor, reflective exercises, and ongoing reporting to zonal secretaries within the regular territorial review process.
INTERNATIONAL COLLEGE FOR OFFICERS: Based at Sunbury Court, London, the International College for Officers (ICO) brings together groups of officers from around The Salvation Army world for a six-week training experience, considering the opportunities and challenges facing Salvation Army leaders in the 21st century. Four groups or
Global ministry: delegates of the International College for Officers
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Future PlansThe International Officer Training and Leader Development Council (IOTALDC) will work to review, develop and implement policies for training and leader development including curriculum standards, training accreditation and capacity building of leaders. Two territories will be engaged to develop and implement an Administrative Leaders’ Training Course, an intentional process of debriefing and leader development for ICO delegates after returning to their home territory. Use of the leader development course (online modules) will be promoted and a new coach/mentor system for leaders implemented.
OPPORTUNITY TO MIX WITH FELLOW OFFICERS FROM
DIFFERENT CULTURES, AND TO LEARN ABOUT THE WAY THAT THE SALVATION ARMY MEETS
NEED AND PREACHES THE GOSPEL IN DIFFERENT SETTINGS
‘sessions’ attend the college each year. There is opportunity for reflection and spiritual formation, together with lectures and seminars on leadership, theology, ethics, social justice, finance and a number of other topics. A special feature for delegates attending is the opportunity to mix with fellow officers from different cultures, and to learn about the way that The Salvation Army meets need and preaches the gospel in different settings. Two sessions each year are designated as ‘translation sessions’ and these contain a higher than usual number of delegates from a specific language group. All lectures and meetings are translated on such occasions. Accountability, governance and transparency issues have recently been selected for special emphasis in lectures and all teaching includes a component focused upon these topics.
The challenge of obtaining visas to allow delegates to enter the UK is considerable and some proposed delegates for recent sessions have been disappointed and refused entry. It is also challenging to find ways for prospective delegates to learn sufficient English to be able to understand the presentations given. Delegates continue to speak of the ICO experience as a highlight of their officership, as the college offers them a broader understanding of the internationalism of The Salvation Army within which they serve.
Key Statistics●● In the period April 2017 to March 2018, 167 delegates
attended the ICO, representing 50 Salvation Army territories.
●● Twenty-four territorial commanders, chief secretaries, general secretaries, territorial presidents of women’s ministries, and territorial secretaries for women’s ministries received orientation training at IHQ during the year.
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OVERALL OBJECTIVETo respond to and help meet the needs arising from major crises.
Specific AimsThe International Emergency Services (IES) team based at IHQ aims to support responses to disaster situations around the world and to help strengthen capacity of territories in their response to emergencies and disaster preparedness by providing programme monitoring and support in addition to training workshops.
AchievementsDuring 2017/18 various countries have been affected by natural and man-made disasters including those caused by severe weather events, drought, earthquakes and conflict.
IES has provided practical assistance with deployed teams, technical guidance and project funding to support a range of relief and recovery responses.
HURRICANE RESPONSE: A particularly devastating hurricane season affected large areas of the USA, the Caribbean and Latin America during the year under review. IES participated in relief responses in many of the affected islands of the Caribbean including Antigua, Turks and Caicos, Sint Maarten, St Kitts and Nevis, Cuba, Dominica, Dominican Republic, Barbuda and the Bahamas. Essential supplies of food, water, bedding and household utensils were provided within the initial response. Work is continuing with building materials offered to facilitate construction and long-term recovery as people return to their homes. A small international team was deployed directly from IHQ to Sint Maarten to support the relief and recovery efforts on the island, which suffered particularly severe damage.
Hot meal distribution in Antigua for evacuees from Barbuda, Caribbean
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EARTHQUAKE RELIEF: Two powerful earthquakes affected Mexico in September 2017 and Salvation Army emergency teams sprang into action to respond to the immediate needs of those affected. Communities rallied together in order to support relief and clean-up activities. A long-term home rebuilding recovery programme will continue into 2018/19.
FLOODING RESPONSE: While the devastation caused by hurricanes in the Caribbean and USA received significant news coverage, little publicity was given to the hardship of people in South Asia affected by the heavy monsoon rains. Communities in India, Pakistan, Bangladesh and Sri Lanka faced devastation as floods and landslides washed homes and livelihoods away. Once again, Salvation Army
teams responded with support to provide essential food and supplies. A house rebuilding project was also implemented for a remote hillside community in Bangladesh, bringing much-needed assistance to vulnerable people.
REFUGEE AID: Many people of South Sudan, affected by conflict and drought in their homeland, are crossing international borders as refugees searching for safety, security and a better life for their families. In Uganda, which has welcomed more than one million people, The Salvation
Compassion in action: earthquake relief in Mexico
MANY PEOPLE OF SOUTH SUDAN, AFFECTED BY CONFLICT AND DROUGHT IN THEIR HOMELAND, ARE CROSSING INTERNATIONAL BORDERS AS REFUGEES SEARCHING FOR SAFETY, SECURITY AND A BETTER LIFE FOR THEIR FAMILIES.
ANNUAL REPORT 23
Key Statistics●● During the year, 54 rapid-response projects were
approved for initial, urgent life-saving activities spanning 29 countries with more than 78,500 beneficiaries.
●● Thirty-three IES projects were approved for larger/long-term recovery activities spanning 27 countries with more than 74,000 beneficiaries.
Future PlansIES will deliver further training in several locations to strengthen capacity of countries which suffer disasters on a regular basis with events for Japan, India and Malaysia already in the planning stages. Zimbabwe is holding national elections during 2018 and similar to the programme delivered in Kenya last year, a peace-building workshop is planned to enhance the peace and reconciliation work that the territory will implement around the vote. A zonal capacity-building summit is also planned to enhance coordination and response when several countries are impacted by disaster at the same time.
Army has contributed to the humanitarian response by providing essential services, particularly water boreholes and latrines, both in several refugee settlements and in host communities identified as vulnerable. A small international team was deployed directly from IHQ to assist the Uganda Territory in the implementation of these activities, which have been well received and are of great benefit to those affected.
TRAINING: IES has supported territories in their disaster management plans through emergency response and preparedness workshops delivered by IES staff. In Sri Lanka, delegates were encouraged to learn something of international humanitarian principles and codes of conduct for emergency response and relate these, along with practical skills to their local crisis responses. A PREPARE course for 25 people was delivered in the USA Western Territory in order to add suitably trained personnel to the list of those able to be deployed for emergency responses internationally in the future.
Life-giving water from a new borehole used by South Sudanese refugees in Uganda
5HEALTH SERVICESFOR THE
POOREST PEOPLE
24 ANNUAL REPORT
ANNUAL REPORT 25
OVERALL OBJECTIVETo strengthen The Salvation Army’s capacity to support poor and marginalised people in accessing quality primary health care services as close to the family as possible.
Specific Aims Specific objectives for International Health Services (IHS) during 2017/18 included: providing support and supervision to clinics, hospitals and nursing schools around the Salvation Army world; supporting health institution facilities to move forward with property renovations to better service the needs of patients; and providing in-service training to professional staff.
Achievements
The Salvation Army continues to be a significant provider of faith-based, integrated, high-quality health care with services offered as close to the family as possible and giving priority to poor and marginalised members of society. The following examples illustrate the breadth and depth of this service provision:
INDIA SOUTH EASTERN: Catherine Booth Hospital has been training nurses since 1937, when Colonel (Dr) Noble opened the first training school with eight students. Training programmes have improved and grown over the years and in 2012 the hospital commenced training of Bachelor of Science (BSc) students. In December 2017, the first group of 50 BSc students graduated from the training school. IHS Coordinator Major Joan Gibson of IHQ attended the ceremony as guest speaker and graduating and continuing
Graduation celebrations at Catherine Booth College of Nursing, India South Eastern
26 ANNUAL REPORT
‘Kangaroo Care’ midwifery training for preterm babies in Ghana
ANNUAL REPORT 27
students participated in a lamp lighting ceremony pledging to care for the sick regardless of colour, creed or status. At March 2018, the college had more than 190 BSc students enrolled and undergoing training.
GHANA: One area of focus for IHS is to reduce maternal and neonatal mortality and morbidity. IHS hopes this can be achieved through the provision of in-service training related to the skills needed to manage obstetrical emergencies, as where health care providers are able to handle emergencies confidently and competently, maternal and infant mortality can be greatly reduced. In Ghana, 25 midwives from nine centres were trained by IHS in ‘kangaroo care’ of the newborn, management of shoulder dystocia and emergency breech delivery. One of the midwives trained, was able to put this knowledge into action before the end of the training week saving a newborn’s life.
INDIA CENTRAL: Evangeline Booth Leprosy Hospital in Bapatla, India Central Territory, has provided services to vulnerable and deprived leprosy patients since 1934. Following the discovery of a cure for leprosy, the numbers of patients at the hospital greatly decreased and today the facilities are used to provide a home to 10 early leprosy patients who otherwise would have no one to care for them. The Salvation Army Officers in charge offer patients food and shelter as well as assistance with medical and physiotherapy care. Facilities were enhanced during the year under review with funding provided by the Trust for renovation of the kitchens, bedrooms and bathrooms to enrich the living environment for residents.
Key Statistics●● During 2017/18, the 38 Salvation Army hospitals and 134 clinics
provided care to 237,569 in-patients and 1,454,233 out-patients.
●● IHS provided support and supervision to 10 hospitals, 18 clinics, four nursing schools, three rehabilitation centres and two leprosy homes during 2017/18.
Future PlansIHS will develop a new support tool for Salvation Army health care facilities, as well as providing ongoing in-service education and support to Salvation Army medical institutions around the world, equipping and enabling provision of quality health care to poor and marginalised people at the point of need.
28 ANNUAL REPORT
6FIGHTING AGAINSTSEXUAL TRAFFICKING
AND FORSOCIAL JUSTICE
ANNUAL REPORT 29
OVERALL OBJECTIVETo take action to combat the massive and growing evil of sexual trafficking and to create awareness of social injustice in the world.
Specific AimsTo support victims of human trafficking, work to prevent people being trafficked and raise awareness of social injustice by building capacity in people, developing effective partnerships, sharing quality resources and promoting best practice.
Achievements The International Social Justice Commission (ISJC), with its secretariat in New York, advises the General and other senior leaders on matters of social justice. The Director of the ISJC – supported by a team of experts – is The Salvation Army’s principal international advocate and adviser on social, economic and political issues giving rise to the perpetuation of social injustice in the world. In the period under review, the following are notable achievements:
MODERN SLAVERY AND HUMAN TRAFFICKING: The Deputy Director of the ISJC chaired an international task force that developed an international strategy and resources to encourage, support and coordinate anti-human trafficking responses around the world. The task force includes experienced international leaders as well as field practitioners. The strategy, approved by the General, encourages all Salvation Army territories and commands to respond to the evil of modern slavery and human trafficking with particular emphasis on:
●● Prayer with involvement in the International Day of Prayer for Victims of Human Trafficking, recognising that all Salvation Army modern slavery and human trafficking responses should be based on deep spiritual foundations.
●● Taking action to prevent people being lured into trafficking and modern slavery.
Journée annuelle de prière pour LES VICTIMES DE LA
TRAITE DES ETRES HUMAINS
Dimanche 25 Septembre 2016
Multi-language posters publicising The Salvation Army’s Annual Day of Prayer for victms of human-trafficking
30 ANNUAL REPORT
The Salvation Army will therefore continue initiatives to:
●● Protect people who are already caught up in the process of trafficking and enable them to exit their situation and be restored to their full potential.
●● Enable the prosecution of offenders so that the trafficking process is stopped, the victims and survivors can experience justice and work with offenders to prevent further repetition of their behaviour and restoration to a relationship with God and society.
●● Build partnerships with other anti-human trafficking agencies which are mutually beneficial, values based and have shared aims.
●● Adopt internal policy that supports modern slavery and human trafficking responses and promotes policy externally which reduces incidence of trafficking (for example advocacy for national legislation and its implementation).
●● Enable the participation of individuals, corps and institutions in modern slavery and human trafficking response activities.
Members of the International Moral and Social Issues Council at the United Nations (UN), New York, USA
THE SALVATION ARMY
INTERNATIONAL POSITIONAL STATEMENT
MODERN SLAVERY AND
HUMAN TRAFFICKING
IPS
ANNUAL REPORT 31
In most countries where it is operating, The Salvation Army is already involved in the fight against modern slavery and human trafficking. Much of The Salvation Army’s work focuses on prevention, protection, partnerships and prayer to support victims, survivors and potential victims of human trafficking and modern slavery. Networks are being strengthened within The Salvation Army and with partners. In the year under review, a workshop was held in Brasilia, Brazil, arranged by The Salvation Army, the Anglican Alliance and Caritas. Practitioners met with denominational leaders to learn from each other and build networks for future cooperation.
REFUGEES AND DISPLACED PEOPLE: The global refugee and migration crisis dominated discussions at the United Nations (UN) in the period under review. To inform and motivate a greater Salvation Army response, the ISJC organised ‘The Global Interactive Summit on Refugees and Displaced People’ in January 2018. Six 90-minute sessions were held over two days – four hosted in New York and two in London. More than 25,000 people viewed at least part of the six sessions which were innovative in the use of the Facebook Live platform to engage and connect people around the world.
STRENGTHENING GRASSROOTS CAPACITY FOR SOCIAL JUSTICE: A new capacity-building programme was launched this year at the ISJC to intentionally develop younger Salvation Army officers for social justice ministry. Three women officers and one male officer – from Kenya, Pakistan and Indonesia – attended the programme. The officers developed plans for implementation back home and the ISJC is offering technical support over two years. In addition to the officer capacity-building programme, two interns worked at the ISJC during the period under review. Working with experienced Salvation Army officer mentors, these young graduates (all in their 20s) developed knowledge about social justice, theology and the UN system. Many of those who have completed the programme over the past 10 years are making a significant contribution to Salvation Army work around the world.
RESEARCH ON ISSUES OF SOCIAL INJUSTICE: The ISJC is coordinating the development of resources and research with the Salvation Army’s International Theological Council and International Moral and Social Issues Council (IMASIC)
to enable Army personnel to better understand and respond in a Christlike manner to issues related to human sexuality. In March 2018, IMASIC – a group of 15 Salvation Army officers and soldiers from around the world – met in New York for one of its regular four-day meetings. IMASIC is part of the ISJC and develops resources to help The Salvation Army respond to global issues. In the year under review, IMASIC produced three International Positional Statements (Racism; Modern Slavery and Human Trafficking; Ancestral Worship). They are available for download at www.salvationarmy.org/isjc/ips
PARTNERSHIPS: The ISJC represents The Salvation Army at the UN and participates in a number of bodies seeking to build strong alliances to end extreme poverty and promote sustainable development.
In the year under review, The Salvation Army became an official partner of the UNHCR – the UN refugee agency. The Salvation Army also participates in the Partnership for Religion and Development (PaRD) (http://www.partner-religion-development.org/) which brings together governments (Germany, USA, UK, etc) with UN agencies and faith-based and religious organisations. The Salvation Army is an active member of the Joint Learning Initiative on Faith and Local Communities (http://jliflc.com/), the World Bank-initiated Moral Imperative to End Extreme Poverty, and the ACT Alliance. In all of these partnerships The Salvation Army seeks to learn from the experience of others and share its experience with the intention of improving the lives of people.
THE ISJC REPRESENTS THE SALVATION ARMY AT THE UN AND PARTICIPATES IN A NUMBER OF BODIES SEEKING TO BUILD STRONG ALLIANCES TO END EXTREME POVERTY AND PROMOTE SUSTAINABLE DEVELOPMENT
32 ANNUAL REPORT
Key Statistics●● The Salvation Army engages with the UN in Geneva,
Nairobi and New York. In the year under review, Salvation Army personnel attended 190 meetings and briefings at the UN and associated committees. A brief report was posted online after 43 of the most significant meetings so that the learnings were shared widely (see www.salvationarmy.org/isjc/unreports).
●● In the year under review, significant time and energy has been invested in strengthening the ISJC social media presence. Facebook page follows are up 40 per cent and website views up 115 per cent, representing an increased awareness of the work of the ISJC and issues of social justice.
●● The ISJC facilitated education sessions throughout the year, including at the ICO; USA National Social Services Conference in Philadelphia, USA; African Leaders Conference in Madagascar; Leadership Retreat in Canada; and youth leadership engagements with all six Indian territories.
Future Plans The Salvation Army, supported by the ISJC, will campaign for a holistic understanding of people and an integrated global plan for fair, sustainable and equitable development for all nations. To this end, The Salvation Army will continue to partner with other religious groups, faith-based organisations, other non-governmental organisations, the UN, the World Bank Group and others, towards the vision of a world where all people can experience life in all its fullness.
The ISJC will work with territories to develop locally relevant modern slavery and human trafficking response strategies, particularly in areas where existing capacity is low and poorly resourced. This will include rolling out international guidelines and protocols so that best practice is shared across The Salvation Army.
The ISJC will continue to promote justice and reconciliation. To mark the 70th anniversary of the Universal Declaration of Human Rights, a publication titled The Salvation Army and Human Rights will be released.
Captain Aron Wambua, Kenya East Territory, at the Commission on the Status of Women at the UN, New York, USA
FINANCIAL REVIEW
ANNUAL REPORT 33
34 ANNUAL REPORT
INCOMETotal income increased from £56.44 million (2017) to £65.24 million (2018) reflecting an increase in external donations and legacies from £16.19 million (2017) to £22.95 million (2018) and also an increase in Headquarters Support funding from Salvation Army territories from £7.54 million (2017) to £9.00 million (2018). Gains on disposal of properties also increased from £17,000 (2017) to £863,000 (2018) as two properties were sold during the financial year, whilst last year the Trust sold no properties.
Contributions from Salvation Army territories to the International Self-Denial Fund showed limited movement from £25.34 million (2017) to £24.81 million (2018) in line with expectations while donations from Salvation Army
FINANCIAL REVIEW
territories also remained relatively flat with a small year-on-year decrease of £338,000. A Gift Aid donation of £129,000 was received from Reliance Bank Limited while in 2017 the Bank retained all post-tax profit.
Investment income recorded a small increase from £3.60 million (2017) to £4.08 million (2018), while income from charitable activities decreased by £90,000 due to a fall in publications income, and income from other trading activities increased by £78,000 due to an uplift in conference centre income. The following pie charts illustrate the sources of income for 2017/18 and also contributions to the International Self Denial Fund:
Charitable Activities 1.1%
Gain on Property Disposal 1.3%
Self-Denial Fund 38.0%
International HQ Support 13.8%
Investment Income 6.3%
Fund Generating Activities 0.4%
INCOME 2017/2018
The net movement in funds for the year ended 31 March 2018 decreased by £12.41 million, moving from £36.40 million (2017) to £23.99 million (2018).
Most notably, net gains on investment assets decreased by £9.89 million from £21.17 million (2017) to £11.28 million (2018) reflecting market conditions and representing both the realised and unrealised gains arising on sales and the market value of investments held at year end. Other notable variances contributing to the total net movement in funds are outlined below.
Donations andLegacies 39.1%
International HQ Support 13.8%
South Asia 1%
Europe 15%
Americas and Caribbean 72%
Africa 5%
SELF-DENIAL FUND CONTRIBUTIONS 2017/2018
EXPENDITUREExpenditure across the six charitable activities in which The Salvation Army International Trust is engaged is detailed in Note 9 in the Accounts. Spending on charitable activities totalled £47.76 million (2018) representing a noteworthy increase of £4.86 million on the previous year.
Financial assistance to Salvation Army territories increased from £27.70 million (2017) to £31.75 million (2018) including additional ‘seed’ funding made available to territories to develop local income streams and so reduce long-term reliance upon IHQ grants.
Expenditure of £8.85 million (2018) was also incurred on International Personnel and Development, £3.99 million (2018) on World Mission and £1.79 million (2018) on Crisis Relief, reflecting the cost of some of the strategies in which the Trust is engaging, as referenced earlier in this report. The following pie charts illustrate 2017/18 expenditure on charitable activities and also the geographic spread of support of overseas work:
ANNUAL REPORT 35
CONTRIBUTIONS FROM SALVATION ARMY TERRITORIESTO THE INTERNATIONAL SELF-DENIAL FUND
SHOWED LIMITED MOVEMENT FROM 2017
South Pacific and East Asia 7%
36 ANNUAL REPORT
EXPENDITURE ON CHARITABLE ACTIVITIES 2017/2018
SUPPORT OF OVERSEAS WORK 2017/2018
World Mission 8.4% Social Justice 2.0%
South Pacific and East Asia 7.3%
South Asia 21.2%Africa 35.8%
Americas and Caribbean 18.4%
Europe 17.3%
Crisis Relief 3.7%
Health Services 0.9%
International Personnel Training and Development 18.5%
Assistance to Salvation Army Territories 66.5%
ANNUAL REPORT 37
INVESTMENTS
Listed investments (see Note 22 (c) in the Accounts) are managed under the terms of an investment management agreement with Sarasin & Partners LLP. The investment manager is required to make investments on behalf of the Trust in line with benchmarks that have been set and against which performance is measured.
The Investment Committee which sits to review investment performance receives periodic reports on matters pertinent to its investment policy and this facilitates discussion which, in turn, enhances the committee’s understanding of the relationship between its Christian conviction and ethos and investment return; and even more importantly, the positive effect that its policy can have on companies which themselves may (or may not) be seeking to improve conditions in many parts of the world. The reports are tabled at full board meetings so that those directors who do not sit on the Investment Committee have an opportunity to add to the debate and have greater understanding of the issues that the Trust can tackle through its investment policy.
The Trust operates an investment policy to reflect the Salvation Army’s ethical and moral stance: it does not wish to invest in tobacco, brewing, gambling, pornography, arms or companies that disregard the pollution of the environment. Investment is therefore excluded in companies which derive more than 10% in aggregate of their revenues from the following activities:
a. the production of alcoholb. the sale (together with any production) of alcoholc. the production of tobaccod. the sale (together with any production) of tobaccoe. the manufacture of whole weapons, weapon platforms
and weapon systemsf. the manufacture or sale of strategic parts for weapon
systemsg. the promotion of gamblingh. the provision of adult entertainment services (other than
mobile communications)i. the publication or wholesale of pornographic magazines
or newspapersj. the extraction of thermal coal or the production of oil
from tar sands.
For the avoidance of doubt the relation to sub-paragraphs (e) and (f) above, ‘weapons’ refers to both nuclear and conventional weapons. Beyond the ethical statement, the investment manager is directed to take into account The Salvation Army Act 1980 and to monitor the portfolio to ensure companies held within it adhere to best practice in corporate governance, employment conditions and environmental sustainability.
The following table gives the long-term ranges and current weightings expressed in percentages of the Trust’s investment funds:
The net movement in funds for the year ended 31 March 2018 was £23.99 million with surpluses on unrestricted funds of £29.79 million and deficits on restricted funds of £5.80 million. Total funds of £246.15 million were held at year end.
FUTURE PLANS
The Trustee seeks to maintain the strong financial position of the Trust and will continue to explore means to increase the scale and scope of charitable activities while continuing to encourage Salvation Army territories to move towards financial self-reliance through provision of targeted financial support and other resources. The Trustee recognises the material pension liability arising from participation of the Trust in The Salvation Army Employees’ Pension Fund (see Note 16 in the Accounts) and is well placed to meet its obligations in this regard.
Two large-scale international projects are underway and will materially impact the Accounts of the Trust during 2018/19,
being the roll-out of a new global email solution and the implementation of cloud-based accounting software to all financially supported territories. Following the year end, the Trust approved a material grant to the Zambia Territory to fund the building of a new territorial headquarters, with a number of other material property projects awaiting planning consents and final approval.
The Trustee continues to monitor developments closely in relation to the UK exit from the EU and other external events and remains confident that the level of reserves held is adequate in the changing economic climate and does not impact adversely on the Trust’s going concern status.
38 ANNUAL REPORT
For the year ended 31 March 2018, the portfolio total return amounted to 6.2 per cent against an ethically adjusted benchmark return of 2.1 per cent.
*There was a material capital addition to the portfolio prior to the year end.
GrantsIn supporting the Army’s work overseas, territories, commands and regions produce annual budget proposals, covering all aspects of their operations that are reviewed at IHQ. Annual grants are allocated by the Trustee and paid quarterly in advance to each mission supported territory, command and region (see Note 10 in the Accounts).
Reliance Bank LimitedThe Bank remains profitable, despite The Bank of England Base Rate of interest being at its record low level of 0.25% for much of the financial year, rising to 0.50% in November 2017. Income from wholesale investments and variable rate lending to customers has been deflated as a consequence.
The Bank’s performance was better than forecast with operating profit for the year ended 31 March 2018 being £304,276 (2017: £412,025) which, after tax and Gift Aid donations, increased capital by £54,832 (2017: £320,285) to £11.40 million. Rather than making Gift Aid donations to its shareholders in the preceding year, the Bank retained all
post-tax profit in order to accommodate known increases in regulatory capital requirements. This year the Bank has made a Gift Aid donation of £228,207 equally divided between The Salvation Army International Trust and The Salvation Army Trust. The total of the Bank’s assets at 31 March 2018 amounted to £209.16 million (2017: £226.67 million) and liabilities reduced to £197.78 million (2017: £215.31 million). The Bank continues to maintain excellent liquidity and funding levels.
ReservesThe total funds of the Trust at 31 March 2018 amounted to £246.15 million comprising £30.12 million in restricted funds and £216.03 million in unrestricted funds which includes £190.27 million in designated funds. The Trustee continues to keep the matter of reserves under review, with a project ongoing to reduce the number of different funds held and also examine any historic funds with minimal movement in the past few years.
Restricted Funds Where possible the intention continues to use restricted donations and legacies in the year of receipt, except where the gift is sufficiently large to be used over a longer period.
Designated Funds The Self-Denial Fund Reserve represents amounts held to ensure sufficient funds are available to make maintenance grants to supported territories that are paid in advance on a quarterly basis. The aim of the Trustee is for the balance on this Reserve to be sufficient to fund one year’s expenditure
AT 31/03/18 LONG-TERM RANGE WEIGHTINGS
ASSET TYPE YEAR END POSITION
Fixed Income
Equities
Liquid Assets
TOTAL
10 - 30%
70 - 90%
0 - 5%
16.2%
72.9%
10.9% *
100%
ANNUAL REPORT 39
in support of overseas work. The current balance of £21.72 million is equivalent to 12 months’ expenditure and therefore meets the target level.
Other material designated amounts at 31 March 2018 relate to a reserve held to fund future replacement of the IHQ building (£14.71 million), a Property Commitments Reserve (£6.84 million) held to fund property acquisitions by the Trust over the next two-four years and an International Property Project Reserve (£6.46 million) held to provide additional property project funding to territories over the next two-four years. In addition, an International Financial and Accounting Standards Reserve (£10.00 million) is held to fund provision of cloud-based accounting software to territories over the next three-five years and an IT Development Reserve (£6.43 million) is held to fund provision of a new global email solution to territories over the next three-five years.
An International Schools Development Reserve (£7.27 million) is also held to provide additional schools project funding to territories over the next two-four years, an Exchange Equalisation Reserve (£3.71 million) is held to fund exchange losses and a Mission Support Reserve (£1.52 million) is held to provide additional project funding to territories over the next two-four years.
General Reserve The General Reserve is retained to cover the shortfall between expenditure and income of other overseas support and governance costs. The aim of the Trustee is for the balance on the General Fund Reserve to cover 50 per cent of these annual costs. The current balance of £5.33 million meets the target level, being equivalent to 7.1 months’ expenditure.
Principal Risks and UncertaintiesThe Trustee acknowledges its responsibilities relating to the management of risk. A formal risk management programme continues to operate allowing risks to be identified, classified and prioritised in terms of potential occurrence and impact. The Board of Directors of SAITCo has appointed a Risk Management Committee consisting of seven members, including a Non-Executive Director.
A Risk Manager has been appointed and a Risk Register is maintained and kept under regular review by the Risk Manager and the Risk Management Committee. The Risk Management Committee works with the Risk Owner of each major risk to ensure acceptable action is taken to manage the risk and to establish suitable systems to reduce the likelihood of harmful outcomes occurring and the impact on the organisation should they occur.
The main risks and uncertainties faced by the Trust, as detailed in the Risk Register at the end of the financial year under review, are outlined below in top-down priority order together with a summary of the mitigating strategies being pursued to manage these risks:
40 ANNUAL REPORT
MITIGATING STRATEGYKEY RISK
A serious safeguarding incident resulting in harm to a child or vulnerable adult and subsequent reputational damage to the local/international Salvation Army.
Local issues in a territory resulting in demands for additional IHQ financial support and/or reputational damage to the local/international Salvation Army.
National economic and/or political crises adversely impacting Salvation Army operations in a territory prompting additional emergency support from IHQ.
Changes in national legislation (including tax codes) adversely impacting Salvation Army operations in territories and engagement of territories with IHQ.
Local issues resulting in use of donor restricted funds within a territory for non-specified purposes.
Loss of funds due to foreign exchange fluctuations.
Establishment of an international safeguarding office at IHQ. Ongoing development of safeguarding policies and procedures for IHQ and all Salvation Army territories.
Continuous IHQ monitoring of global operations on a territory-by-territory basis. A suite of policies and procedures in place to manage operational risks. Internal audits undertaken periodically depending on the extent of perceived risk.
Continuous IHQ monitoring of economic and political contexts on a country-by-country basis. Development of crisis management protocols for IHQ interventions.
Continuous monitoring of legislative contexts on a country-by-country basis overseen by IHQ legal counsel liaising with locally appointed lawyers.
Continuous IHQ monitoring of application of project funds via bespoke databases. Policies and procedures in place to regulate use of project funds. Internal and external audits undertaken for project-related activity depending on the extent of perceived risk.
Regular assessment of foreign exchange risks by Investment Committee. Maintenance of Exchange Equalisation Reserve by the Trust to fund exchange losses.
ANNUAL REPORT 41
The Trustee is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Charity law requires the Trustees to prepare financial statements for each financial year in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under The Charity Law the Trustee must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charity for that period.
In preparing these financial statements, the Trustee is required to:
●● select suitable accounting policies and then apply them consistently;
●● make judgements and accounting estimates that are reasonable and prudent;
●● state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
●● prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in business.
The Trustee is responsible for keeping adequate accounting records that are sufficient to show and explain the charity’s transactions and 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 Act 2011. 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 Trustee has approved this 2017/18 Annual Report and Accounts on this basis.
For and on behalf of the directors of The Salvation Army International Trustee Company.
Statement of Trustee’sResponsibilities
Dr Matthew Carpenter BA, MBA, DBA, MCMI Company Secretary
28 September 2018
42 ANNUAL REPORT
OpinionWe have audited the financial statements of The Salvation Army International Trust (‘the Charity’) for the year ended 31 March 2018, which comprise the statement of financial activities, the balance sheet, the cash flow statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
●● give a true and fair view of the state of the Charity’s affairs as at 31 March 2018 and of its incoming resources and application of resources for the year then ended;
●● have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
●● have been prepared in accordance with the requirements of the Charities Act 2011 and The Salvation Army Act 1980.
Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Charity in accordance with the ethical requirements relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions related to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
●● the Trustee’s use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
●● the Trustee has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Charity’s ability to continue to adopt the going concern basis of accounting for a period of at least 12 months from the date when the financial statements are authorised for issue.
Other information
The other information comprises the information included in the Report and Accounts, other than the financial statements and our auditor’s report thereon. The other information comprises: The Trustee’s Annual Report, Worldwide Facts and Figures Listing and Direct Territorial Project Contributions Listing. The Trustee is responsible for the other information.
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Independent Auditor’s Report to the Trustee of The Salvation Army International Trust
ANNUAL REPORT 43
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in relation to which the Charities Act 2011 requires us to report to you if, in our opinion;
●● the information contained in the financial statements is inconsistent in any material respect with the Trustees’ Annual Report; or
●● adequate accounting records have not been kept; or
●● the financial statements are not in agreement with the accounting records and returns; or
●● we have not received all the information and explanations we require for our audit.
Responsibilities of the Trustee
As explained more fully in the Statement of Trustee’s responsibilities, the Trustee is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustee determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Trustee is responsible for assessing the Charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustee either intends to liquidate the Charity or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (FRC’s) website at:
https://www.frc.org.uk/auditorsresponsibilities This description forms part of our auditor’s report.
Use of our reportThis report is made solely to the Charity’s trustee, as a body, in accordance with the Charities Act 2011 and The Salvation Army Act 1980. Our audit work has been undertaken so that we might state to the Charity’s trustee those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Charity and the Charity’s trustee as a body, for our audit work, for this report, or for the opinions we have formed.
DON BAWTREE (Senior Statutory Auditor) For and on behalf of BDO LLP, Statutory AuditorGatwick United Kingdom
Date: 28 September 2018
BDO LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
44 ANNUAL REPORT
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STATEMENT OF FINANCIAL ACTIVITIESFOR THE YEAR ENDED 31 MARCH 2018
THE SALVATION ARMY INTERNATIONAL TRUST
2018 2017
NotesUnrestricted
fundsRestricted
funds Total funds Total funds£000 £000 £000 £000
INCOME AND ENDOWMENTS FROMDonations and legacies:
Received from Salvation Army territories- Self-Denial Fund 2 24,813 - 24,813 25,341- IHQ Support 2 9,001 9,001 7,542- Donations 2 - 2,449 2,449 2,787Joint Venture - Donation 3 129 - 129 - Other donations and legacies 4 22,902 51 22,953 16,188
56,845 2,500 59,345 51,858Charitable activities 5 676 - 676 766Other trading activities 6 279 - 279 201Investments 7 3,454 625 4,079 3,599Gain on Disposal of Properties 863 - 863 17
Total Income 62,117 3,125 65,242 56,441
EXPENDITURE ONRaising funds 8 1,183 148 1,331 1,085Charitable activities 9 42,986 4,772 47,758 42,900
Total Expenditure 44,169 4,920 49,089 43,985
Net gains/(losses) on investments 22(d) 10,566 711 11,277 21,166Net income/(expenditure) 28,514 (1,084) 27,430 33,622
Transfers between funds 18 4,697 (4,697) - - Other recognised gains/(losses):
Other gains/(losses) (3,422) (23) (3,445) 2,777Net Movement in Funds 18 29,789 (5,804) 23,985 36,399
Reconciliation of funds:Total funds brought forward 1 April 2017 186,238 35,927 222,165 185,766Total funds carried forward 31 March 2018 216,027 30,123 246,150 222,165
All activities reported above, in both the current and preceding year, relate to continuing activities.
THE SALVATION ARMY INTERNATIONAL TRUST
STATEMENT OF FINANCIAL ACTIVITIES
FOR THE YEAR ENDED 31 MARCH 2018
Page 1
All activities reported above, in both the current and preceding year, relate to continuing activities.
ANNUAL REPORT 45
THE SALVATION ARMY INTERNATIONAL TRUST
BALANCE SHEET
Notes 2018 2017£000 £000
Fixed AssetsProperties 20 28,686 28,943Other Tangible Fixed Assets 21 1,171 1,457Investments 22 187,818 161,626
217,675 192,026
Current AssetsStocks 133 161Debtors and Prepayments 23 34,390 34,466Cash at bank and in hand 24 873 368
35,396 34,995
Less Current Liabilities 25 (6,921) (4,856)Net Current Assets 28,475 30,139
Total Assets less current liabilities 246,150 222,165
Net Assets 19 246,150 222,165
FundsRestricted Funds Property Fund 14,779 15,025 Other Fixed Assets Fund 453 766 Other Restricted Funds 14,891 20,136
30,123 35,927
Unrestricted Funds Property Fund 19,707 19,718 Other Fixed Assets Fund 718 691 Designated Funds 190,271 161,451 General Reserve 5,331 4,378
216,027 186,238
Total Funds 18 246,150 222,165
Approved on behalf of The Salvation Army International Trustee Company on 28 September 2018 by:
Lyndon Buckingham - ChairmanMerle Heatwole - Managing Director
AS AT 31 MARCH 2018
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BALANCE SHEET AS AT 31 MARCH 2018
THE SALVATION ARMY INTERNATIONAL TRUST
Approved on behalf of The Salvation Army International Trustee Company on 28 September 2018 by:Lyndon Buckingham – ChairmanMerle Heatwole – Managing Director
BALA
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46 ANNUAL REPORT
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CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2018
THE SALVATION ARMY INTERNATIONAL TRUST
2018 2017£000 £000
Net cash (used in)/provided by operating activities (see note A) 10,601 (5,131)
Cash flows from investing activities:Dividends, interest and rents from investments 4,079 3,599Donation on Joint Venture 129 - Gain/(Loss) on US held investments 3,168 967(Increase)/Decrease in Long Term Bank Deposits 1,287 2,274(Increase)/Decrease in Long Term Loans receivable - 1,047Proceeds from the sale of property, plant and equipment 985 - Purchases of property, plant and equipment (1,151) (1,840)Proceeds from the sale of investments 33,941 66,840Purchase of Investments (41,892) (73,105)Net cash provided by/used in investing activities 546 (218)
Change in cash and cash equivalents in the reporting period 11,147 (5,349)Cash and cash equivalents at the beginning of the reporting period 10,410 15,759Cash and cash equivalents at the end of the reporting period (see note B) 21,557 10,410
Note A
Reconciliation of net income/(expenditure) to net cash flow from operating activities
Net income for the reporting period (as per the statement of financial activities) 23,985 36,399
Adjustments for:Depreciation charges 1,444 1,323(Gain) on investments (11,277) (21,166)Revaluation of US Dollar Deposits (649) 7Donation on Joint Venture (129) - Dividends, interest and rents from investments (4,079) (3,599)(Profit) on sale of fixed assets (863) - Decrease/(Increase) in Stocks 28 (60)Decrease/(Increase) in Debtors 76 (20,396)Increase in Creditors 2,065 2,361Net cash (used in)/provided by operating activities 10,601 (5,131)
Note B
Analysis of Cash and Cash Equivalents 2017 in year 2018£000 £000 £000
Cash at bank 368 505 873Cash held by Investment Managers 757 11,743 12,500Notice deposits (less than 3 months) 9,285 (1,101) 8,184Total cash and cash equivalents 10,410 11,147 21,557
THE SALVATION ARMY INTERNATIONAL TRUST
CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 MARCH 2018
Balance Movement Balance
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NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2018
THE SALVATION ARMY INTERNATIONAL TRUST
1. ACCOUNTING POLICIESThe principal accounting policies adopted by the Trustee in the preparation of the financial statements, have been applied consistentlyand are set out below:
(a) Basis of Accounting - The financial statements have been prepared under the historical cost convention,subject to the inclusion of investments at fair value, and are in compliance with the Accounting and Reporting by Charities: Statement of Recommended Practice (FRS 102) (effective 1 January 2015), the Charities Act 2011, The Salvation Army Act 1980 and FRS 102, the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland.
Critical accounting judgements and key estimations - In application of the charity's accounting policies, the accountingpolicies adopted by the Trustee have been applied consistently and are described below:
(b) Income(i) Contributions to the International Self-Denial Fund are received annually from the headquarters of Salvation Army territories
around the world (see Note 2). A territory is an administrative unit and may comprise several countries, a single country or part of a country. These contributions are used to fund grants and other support payments.to non self-supporting territories, as set out in Note 10.
(ii) Contributions to International Headquarters support are receivable quarterly from self-supporting territoriesand annually from non self-supporting territories.
(iii) Legacies are accounted for on receipt or on earlier notification, provided that the value can be reasonably measured and receipt is probable.
(iv) Donations and all other income is recognised in the Statement of Financial Activities when received or receivable, whicheveris earlier, unless it relates to a specific future period in which case it is deferred. Refunds are shown as negative income.
(c) ExpenditureExpenditure is charged in the Statement of Financial Activities on the accruals basis.(i) Irrecoverable Value Added Tax is charged to the related heads of expenditure.(ii) Expenditure on Charitable Activities consists of all expenditure relating directly to the objects of the
Trust including support costs. Support costs have been allocated over activities on a per capita basis.Governance costs include those associated with constitutional and statutory requirementsand those incurred in the governance of the Trust’s assets.
(iii) Maintenance grants are paid quarterly to overseas Salvation Army territories to support their operating costs. They are payable at the beginning of each quarter and are accounted for in the year to which they relate (see Note (b) (i) above).
(iv) Property schemes not completed at the year end are carried forward in the Balance Sheet as a Fixed Asset under the heading of Property Schemes in progress.
(v) Pension costs are accounted for in accordance with FRS 102 and are charged to the Statementof Financial Activities when payable. Details are provided in Note 16.
(vi) Grants payable to Salvation Army Territories are recognised as expenditure when payment is made, in accordance with theannual budget.
(d) Foreign CurrenciesTransactions in foreign currencies are recorded at the rate of exchange prevailing at the date of the transaction.Monetary assets and liabilities are translated into sterling at the exchange rate ruling on the balance sheet date.All profits and losses on exchange are included in the Statement of Financial Activities.
(e) Going ConcernThe Trustee has reviewed the Trust's financial position, taking account of satisfactory levels of reserves and cash, the annual plan, and its system of financial and risk management. As a result of this review the Trustee has a reasonable expectationthat the Trust has adequate resources to continue in operational existence in the foreseeable future. Thus they continue toadopt the going concern basis of accounting in preparing the annual financial statements.
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTSFOR THE YEAR ENDED 31 MARCH 2018
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NOTES TO THE ACCOUNTSFOR THE YEAR ENDED 31 MARCH 2018
1. ACCOUNTING POLICIES - continued
(f) Fixed AssetsTangible fixed assets are stated at cost less accumulated depreciation. Depreciation is provided to write off the cost of tangible fixed assets over their estimated useful economic lives,as follows:l Freehold and Long Leasehold Properties are depreciated over 50 yearsl Internal Fit-Out Costs of the Headquarters building are depreciated over 15 yearsl Office Equipment is depreciated over seven yearsl Vehicles are depreciated at 17% per annuml IT Equipment is depreciated at 25% per annum
The freehold property at Sunbury Court has been depreciated so as to write down the costof the project by components, on a straight line basis over their estimated useful economic livesat the following annual rates:l Building and Infrastructure - 50 yearsl Roof (flat), Windows and Doors - 25 yearsl Major Installations (including heating, electrical, drainage) - 25 yearsl Bathroom and Kitchen Installations, Lifts- 15 yearsl Furniture, Fixtures and Fittings - 15 years
(g) Basic Financial InstrumentsFinancial assets and financial liabilities are recognised when the Trust becomes a party to the contractual provisions ofthe instrument. All financial assets and liabilities are initially measured at transaction price and subsequently measuredat their settlement value.Trade and other debtors are recognised at the settlement amount due. Prepayments are valued at the amount prepaid netof any trade discount offered. Creditors and provisions are recognised where the Trust has an obligation resulting from apast event that is likely to result in the transfer of funds to a third party and the amount due can be measured or estimatedreliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.
(h) Investments - To comply with the Statement of Recommended Practice, investments are included at fair value. Listed investments are valued at the year end bid price. The freehold reversionary interest is externally valued every five years, subject to any significant change in valuein the intervening years.Investment properties are revalued on a rolling three-year basis and held at fair value at the balance sheet date and nodepreciation is provided. The aggregate surplus or deficit arising on revaluation is transferred to a revaluation reserve.
(i) Stocks are valued at the lower of cost or net realisable value.
(j) Funds (i) The Property Fund represents monies already expended on the acquisition of freehold and leasehold properties.(ii) The Restricted Funds are held for restricted purposes, as specified by the donors.
(iii) The Unrestricted Funds include Designated Funds held for particular purposes designated by the Trustee in theexercise of its discretionary powers, and a General Reserve representing funds not designated for specific purposes.
(k) Joint VentureThe banking company, Reliance Bank Limited, in which the Salvation Army International Trust holds a 51% interest, is shown as a Joint Venture with The Salvation Army Trust (United Kingdom Territory with the Republic of Ireland) holding a 49% interest.The Salvation Army International Trust does not control the company and responsibility for the appointment of BankDirectors is held by a Nominations Committee comprising Non-Executive Directors from the Bank.Accordingly the investment in the Joint Venture is shown at cost, and donations received are included under Income in the Statement of Financial Activities.Full details of the company's Profit and Loss Account and Balance Sheet are set out in Note 3.
(l) All recognised gains and losses are included in the Statement of Financial Activities, and all the reported activities, in both the current and preceding years, reflect ongoing activities.
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2. CONTRIBUTIONS RECEIVED FROM SALVATION ARMY TERRITORIES
Territory 2018 2017 2018 2017 2018 2017£000 £000 £000 £000 £000 £000
Angola 22 23 1 1 - - Australia Eastern 500 563 345 335 14 24 Australia Southern 341 414 307 297 (2) 81 Bangladesh 1 2 1 1 - - Brazil 29 47 2 2 - - Canada and Bermuda 1,501 1,332 511 496 232 93 Caribbean 71 64 4 4 1 - Congo (Brazzaville) 91 104 4 4 - - Democratic Republic of Congo 62 65 5 5 - - Denmark 26 26 15 14 8 22 Eastern Europe 9 4 1 2 - - Finland and Estonia 55 45 26 25 34 26 France and Belgium 17 15 46 45 4 2 Germany, Lithuania and Poland 31 30 32 31 28 77 Ghana 19 18 3 2 - - Hong Kong and Macau 76 81 24 23 33 (8) India Central 55 54 7 7 - - India Eastern 101 87 3 3 - - India Northern 25 23 6 5 - - India South Eastern 83 79 6 6 - - India South Western 35 32 6 6 - - India Western 37 35 6 6 - - Indonesia 47 50 10 10 1 - Italy and Greece 5 5 1 1 4 4 Japan 55 62 62 61 7 3 Kenya East 228 220 7 6 1 - Kenya West 146 141 7 7 - - Korea 111 100 11 11 - 83 Latin America North 26 25 2 2 - - Liberia 6 7 1 1 - - Malawi 4 6 1 1 1 - Mali 1 1 1 1 - - Mexico 19 21 2 2 - - Middle East 15 14 1 1 - - Mozambique 2 2 1 1 - - The Netherlands, Czech Republic and Slovakia 194 146 101 98 113 214 New Zealand, Fiji and Tonga 560 603 238 231 59 69 Nigeria 19 25 4 4 - - Norway, Iceland and The Færoes 393 400 89 86 66 59 Pakistan 1 5 5 5 - - Papua New Guinea 40 24 3 3 - 1 The Philippines 10 9 3 3 - - Russia 3 3 - - - - Rwanda and Burundi 6 5 1 1 - - Singapore, Malaysia and Myanmar 75 90 16 16 15 - South America East 23 22 2 2 1 - South America West 39 38 3 3 - - Southern Africa 56 64 3 3 - 3 Spain and Portugal 12 11 1 1 8 3 Sri Lanka 1 1 2 2 - - Sweden and Latvia 105 186 73 70 162 84 Switzerland, Austria and Hungary 727 793 141 137 85 196 Taiwan 8 7 1 1 - 1 Tanzania 9 11 2 2 - - Uganda 4 2 1 1 - - United Kingdom with the Republic of Ireland 2,011 1,936 776 753 444 151 USA Central 3,994 4,133 1,629 1,166 78 63 USA Eastern 4,632 4,476 1,362 1,128 168 844 USA Southern 4,204 4,949 1,740 1,166 150 149 USA Western 3,358 3,104 1,272 1,166 23 291 USA National HQ - - 56 60 711 252 Zambia 80 88 3 3 - - Zimbabwe 397 413 6 6 - -
24,813 25,341 9,001 7,542 2,449 2,787
RestrictedUnrestrictedUnrestricted
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
Self-Denial Fund International Headquarters Support Donations Received
Page 6
2. CONTRIBUTIONS RECEIVED FROM SALVATION ARMY TERRITORIES
Territory 2018 2017 2018 2017 2018 2017£000 £000 £000 £000 £000 £000
Angola 22 23 1 1 - - Australia Eastern 500 563 345 335 14 24 Australia Southern 341 414 307 297 (2) 81 Bangladesh 1 2 1 1 - - Brazil 29 47 2 2 - - Canada and Bermuda 1,501 1,332 511 496 232 93 Caribbean 71 64 4 4 1 - Congo (Brazzaville) 91 104 4 4 - - Democratic Republic of Congo 62 65 5 5 - - Denmark 26 26 15 14 8 22 Eastern Europe 9 4 1 2 - - Finland and Estonia 55 45 26 25 34 26 France and Belgium 17 15 46 45 4 2 Germany, Lithuania and Poland 31 30 32 31 28 77 Ghana 19 18 3 2 - - Hong Kong and Macau 76 81 24 23 33 (8) India Central 55 54 7 7 - - India Eastern 101 87 3 3 - - India Northern 25 23 6 5 - - India South Eastern 83 79 6 6 - - India South Western 35 32 6 6 - - India Western 37 35 6 6 - - Indonesia 47 50 10 10 1 - Italy and Greece 5 5 1 1 4 4 Japan 55 62 62 61 7 3 Kenya East 228 220 7 6 1 - Kenya West 146 141 7 7 - - Korea 111 100 11 11 - 83 Latin America North 26 25 2 2 - - Liberia 6 7 1 1 - - Malawi 4 6 1 1 1 - Mali 1 1 1 1 - - Mexico 19 21 2 2 - - Middle East 15 14 1 1 - - Mozambique 2 2 1 1 - - The Netherlands, Czech Republic and Slovakia 194 146 101 98 113 214 New Zealand, Fiji and Tonga 560 603 238 231 59 69 Nigeria 19 25 4 4 - - Norway, Iceland and The Færoes 393 400 89 86 66 59 Pakistan 1 5 5 5 - - Papua New Guinea 40 24 3 3 - 1 The Philippines 10 9 3 3 - - Russia 3 3 - - - - Rwanda and Burundi 6 5 1 1 - - Singapore, Malaysia and Myanmar 75 90 16 16 15 - South America East 23 22 2 2 1 - South America West 39 38 3 3 - - Southern Africa 56 64 3 3 - 3 Spain and Portugal 12 11 1 1 8 3 Sri Lanka 1 1 2 2 - - Sweden and Latvia 105 186 73 70 162 84 Switzerland, Austria and Hungary 727 793 141 137 85 196 Taiwan 8 7 1 1 - 1 Tanzania 9 11 2 2 - - Uganda 4 2 1 1 - - United Kingdom with the Republic of Ireland 2,011 1,936 776 753 444 151 USA Central 3,994 4,133 1,629 1,166 78 63 USA Eastern 4,632 4,476 1,362 1,128 168 844 USA Southern 4,204 4,949 1,740 1,166 150 149 USA Western 3,358 3,104 1,272 1,166 23 291 USA National HQ - - 56 60 711 252 Zambia 80 88 3 3 - - Zimbabwe 397 413 6 6 - -
24,813 25,341 9,001 7,542 2,449 2,787
RestrictedUnrestrictedUnrestricted
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
Self-Denial Fund International Headquarters Support Donations Received
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50 ANNUAL REPORT
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NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
3. DONATION FROM JOINT VENTUREReliance Bank LimitedThe Salvation Army International Trust has a 51% interest in Reliance Bank Limited, the other 49% being held by The SalvationArmy Trust (United Kingdom Territory with the Republic of Ireland). Reliance Bank Limited provides banking facilities to The Salvation and the general public. The Bank offers transactional banking services to more than 35 Salvation Army territories, providing a vital 'safe haven' for project funds and IHQ operational grantsand a secure platform for international fund transfers for the global Army. During the present reported financial year, 75% of the net taxable profits of the Bank have been donated to support equally the mission of the Army internationally (The Salvation Army International Trust) and in the United Kingdom (The Salvation Army Trust).As set out in accounting policy Note 1(k), the investment in the Joint Venture is shown at cost, and the donationreceived is included under Income in the Statement of Financial Activities.
2018 2017£000 £000
Summary Profit and Loss AccountInterest Receivable and other operating income 2,990 3,167Interest Payable and other operating expenditure (652) (798)Administration Expenditure (2,034) (1,957)Operating Profit 304 412Taxation (21) (92)Profit after Tax 283 320Less donation (228) - Retained Surplus for year 55 320Retained Reserves brought forward 3,850 3,530Retained Reserves carried forward 3,905 3,850
Donation received in year 129 - Share Capital owned 3,825 3,825
Summary Balance SheetFixed Assets 2,819 2,842Current Assets Less than one year 174,945 191,395 Loans over one year 31,395 32,425
209,159 226,662Liabilities Over one year (2,450) (2,100) Current (195,304) (213,212)Net Assets 11,405 11,350
Share Capital 7,500 7,500Reserves 3,905 3,850Shareholders' Funds 11,405 11,350
Unrestricted income to the Salvation Army International Trust from Reliance Bank Limited for the year was £129k (2017: £nil)
4. OTHER DONATIONS AND LEGACIESUnrestricted Restricted 2018 Unrestricted Restricted 2017
£000 £000 £000 £000 £000 £000Other Donations 22,877 51 22,928 16,087 60 16,147Legacies 25 - 25 41 - 41
22,902 51 22,953 16,128 60 16,188
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20175. INCOME FROM CHARITABLE ACTIVITIES £000 £000
Rents from charitable activities 135 139Income from publications 284 376Income from Café 101 257 240International Personnel Training and Development - 11
676 766Restricted income for the year was £nil (2017: £11k)
6. OTHER TRADING ACTIVITIESConference Centre income 220 143Rents from letting of property 59 58
279 201
Unrestricted income for the year was £279k (2017: £201k)
7. INVESTMENT INCOMEIncome from fixed interest securities 454 368Dividends from equities 1,356 1,451Interest on bank deposits 116 88Income from funds held in USA 686 282Rental on Freehold Reversionary Interest 218 218Rents from letting of investment properties 1,249 1,192
4,079 3,599Restricted income for the year was £625k (2017: £469k)
Page 8
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
2018 20178. RAISING FUNDS £000 £000
Cost of letting of property 713 656 Investment management costs 618 429
1,331 1,085Restricted expenditure for the year was £148k (2017: £14k)
9. CHARITABLE ACTIVITIES2018 2017
Activity
Grant and Donation
funding of activities
Activities undertaken
directlySupport
costs Total Total(Note 11)
£000 £000 £000 £000 £000
World Mission - 2,857 1,133 3,990 3,613
Assistance to Salvation Army territories (Note 10) 25,731 4,512 1,510 31,753 27,701
International Personnel Training and Development - 5,934 2,915 8,849 8,014
Crisis Relief - 1,533 252 1,785 1,987
Health Services for the Poorest People - 293 151 444 709
Fighting Against Sexual Trafficking and for Social Justice - 635 302 937 876
25,731 15,764 6,263 47,758 42,900
Grant and donation funding includes operational grants paid quarterly to Salvation Army territories around the World and the onward transmission of project funding.Costs of activities undertaken directly include the direct costs associated with emergency services and other projects which are managed by International Headquarters.Support costs have been allocated over activities on a per capita basis (see Note 11).
Restricted expenditure for the year was £4.8m (2017: £4.0m)
Page 9
52 ANNUAL REPORT
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
10. GRANTS AND DONATIONS PAID TO SALVATION ARMY TERRITORIES IN SUPPORT OF OVERSEAS WORK----------------------------------------------------2018-------------------------------------------------- 2017
Allowable Grant funding Additional Activities deductions of activities grant for funded by
from Self- specific costs donations Total TotalTerritory Denial funds
(see note 1(b(i))£000 £000 £000 £000 £000 £000
Africa, General - - (43) - (43) 202 Americas. General - - 1 9 10 24 Angola 17 54 21 4 96 59 Australia Eastern 75 - - 4 79 84 Australia Southern - - - - - 42 Bangladesh 7 201 - 38 246 374 Brazil 31 648 - 210 889 1,312 Caribbean 21 734 3 154 912 1,266 Congo (Brazzaville) 20 533 22 218 793 858 Czech Republic and Slovakia (Netherlands) - 438 - 12 450 574 Democratic Republic of Congo 7 624 53 136 820 950 Denmark - - - 1 1 20 Eastern Europe 21 1,155 22 232 1,430 1,510 Estonia (Finland) 12 162 - 6 180 137 Europe, General - - - 1 1 30 Fiji and Tonga - - - 15 15 110 France and Belgium 1 - - 41 42 5 Germany, Lithuania and Poland 3 208 - 21 232 234 Ghana and Togo 10 163 50 55 278 223 Hong Kong and Macau - - - 1 1 1 India National Secretariat - 65 - 21 86 71 India Central 1 354 1 228 584 454 India Eastern (5) 29 - 594 618 284 India Northern - 360 1 247 608 499 India South Eastern 2 407 1 28 438 895 India South Western - 400 2 106 508 761 India Western - 304 2 109 415 367 Indonesia - - 14 512 526 213 Italy and Greece 6 244 38 5 293 575 Japan - - - 4 4 - Kenya East 30 352 48 1,439 1,869 688 Kenya West 34 607 48 428 1,117 676 Korea - - - 2 2 1 Latin America North 4 738 - 32 774 856 Latvia (Sweden) 3 139 - 33 175 166 Liberia and Sierra Leone 11 179 1 71 262 208 Malawi 29 127 14 14 184 204 Mali and Burkina Faso 5 58 - 37 100 77 Mexico 3 411 1 20 435 975 Middle East - 269 28 44 341 315 Mozambique 29 246 54 15 344 472 Nigeria 7 213 17 33 270 378 Norway 11 - - - 11 26 Pakistan 3 529 1 222 755 792 Papua New Guinea 44 423 33 388 888 459 The Philippines 5 407 - 38 450 499 Russia - 748 - 1 749 744 Rwanda and Burundi 8 177 18 19 222 251 Singapore, Malaysia and Myanmar - 199 1 88 288 324 South America East 33 561 188 370 1,152 645 South America West 46 454 25 50 575 605 South Asia, General - - 5 - 5 (2) Southern Africa 22 167 2 15 206 225 Spain and Portugal 29 732 - 29 790 1,038 SPEA, General - - - - - 7 Sri Lanka 4 184 2 134 324 256 Switzerland, Austria and Hungary - - - 8 8 90 Taiwan - 99 - 40 139 100 Tanzania 46 156 20 215 437 551 Uganda 25 155 59 7 246 276 United Kingdom with the Republic of Ireland 87 - - - 87 129 Zambia 68 404 11 631 1,114 640 Zimbabwe and Madagascar 88 541 17 254 900 324
2018 - Total 903 16,358 781 7,689 25,731 25,129
2017 - Total 1,165 16,590 377 6,997 25,129
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
10. GRANTS AND DONATIONS PAID TO SALVATION ARMY TERRITORIES IN SUPPORT OF OVERSEAS WORK----------------------------------------------------2018-------------------------------------------------- 2017
Allowable Grant funding Additional Activities deductions of activities grant for funded by
from Self- specific costs donations Total TotalTerritory Denial funds
(see note 1(b(i))£000 £000 £000 £000 £000 £000
Africa, General - - (43) - (43) 202 Americas. General - - 1 9 10 24 Angola 17 54 21 4 96 59 Australia Eastern 75 - - 4 79 84 Australia Southern - - - - - 42 Bangladesh 7 201 - 38 246 374 Brazil 31 648 - 210 889 1,312 Caribbean 21 734 3 154 912 1,266 Congo (Brazzaville) 20 533 22 218 793 858 Czech Republic and Slovakia (Netherlands) - 438 - 12 450 574 Democratic Republic of Congo 7 624 53 136 820 950 Denmark - - - 1 1 20 Eastern Europe 21 1,155 22 232 1,430 1,510 Estonia (Finland) 12 162 - 6 180 137 Europe, General - - - 1 1 30 Fiji and Tonga - - - 15 15 110 France and Belgium 1 - - 41 42 5 Germany, Lithuania and Poland 3 208 - 21 232 234 Ghana and Togo 10 163 50 55 278 223 Hong Kong and Macau - - - 1 1 1 India National Secretariat - 65 - 21 86 71 India Central 1 354 1 228 584 454 India Eastern (5) 29 - 594 618 284 India Northern - 360 1 247 608 499 India South Eastern 2 407 1 28 438 895 India South Western - 400 2 106 508 761 India Western - 304 2 109 415 367 Indonesia - - 14 512 526 213 Italy and Greece 6 244 38 5 293 575 Japan - - - 4 4 - Kenya East 30 352 48 1,439 1,869 688 Kenya West 34 607 48 428 1,117 676 Korea - - - 2 2 1 Latin America North 4 738 - 32 774 856 Latvia (Sweden) 3 139 - 33 175 166 Liberia and Sierra Leone 11 179 1 71 262 208 Malawi 29 127 14 14 184 204 Mali and Burkina Faso 5 58 - 37 100 77 Mexico 3 411 1 20 435 975 Middle East - 269 28 44 341 315 Mozambique 29 246 54 15 344 472 Nigeria 7 213 17 33 270 378 Norway 11 - - - 11 26 Pakistan 3 529 1 222 755 792 Papua New Guinea 44 423 33 388 888 459 The Philippines 5 407 - 38 450 499 Russia - 748 - 1 749 744 Rwanda and Burundi 8 177 18 19 222 251 Singapore, Malaysia and Myanmar - 199 1 88 288 324 South America East 33 561 188 370 1,152 645 South America West 46 454 25 50 575 605 South Asia, General - - 5 - 5 (2) Southern Africa 22 167 2 15 206 225 Spain and Portugal 29 732 - 29 790 1,038 SPEA, General - - - - - 7 Sri Lanka 4 184 2 134 324 256 Switzerland, Austria and Hungary - - - 8 8 90 Taiwan - 99 - 40 139 100 Tanzania 46 156 20 215 437 551 Uganda 25 155 59 7 246 276 United Kingdom with the Republic of Ireland 87 - - - 87 129 Zambia 68 404 11 631 1,114 640 Zimbabwe and Madagascar 88 541 17 254 900 324
2018 - Total 903 16,358 781 7,689 25,731 25,129
2017 - Total 1,165 16,590 377 6,997 25,129
Page 10
ANNUAL REPORT 53
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
11. ANALYSIS OF SUPPORT COSTS BY ACTIVITY2018
Charitable Activities Management Finance & ITHuman
Resources Property DepreciationGovernance (see note 12) Total
£000 £000 £000 £000 £000 £000 £000 World Mission 225 202 58 155 223 270 1,133 Assistance to Salvation Army territories 300 269 77 207 297 360 1,510 International Personnel Training and Development 580 520 149 398 574 694 2,915 Crisis Relief 50 45 13 34 50 60 252 Health Services for the Poorest People 30 27 7 21 30 36 151 Fighting Against Sexual Trafficking and for 60 54 15 41 60 72 302 Social Justice
1,245 1,117 319 856 1,234 1,492 6,263
Depreciation on Vehicles and IT Equipment of £122,000 (2017: £124,000) forms part of rechargeable expenditure allocated on a usage basis and is included in the functional headings above.All support costs have been allocated against Charitable Activities (see note 9).
2018 2017£000 £000
12. GOVERNANCE COSTSInternal Audit 440 314External Audit 48 61Legal and Administration (includes Trustees' Indemnity Insurance) 634 310International Child Protection Governance 309 90Finance and Property 61 54
1,492 829
An Internal Audit Department carries out a cycle of reviews of the systems in operation within IHQ and in all countries where The Salvation Army is working.
Page 11
2018 2017£000 £000
13. PERSONNEL COSTSSalaries and Allowances 4,415 4,095Employer's Social Security Costs 424 390Employer's Pension Costs 448 205
5,287 4,690
The number of employees earning greater than £60,000 per annum was as follows: No. No.£60,001 - £70,000 3 2 £70,001 - £80,000 - 1 £80,001 - £90,000 2 1 £90,001 - £100,000 1 - £100,001 - £110,000 - - £110,001 - £120,000 1 1 Included in the above, the highest paid employee had employer pension contributions of £19,154.
Average number of officers and employees 156 150
The key management personnel of The Salvation Army International Trust, comprise the General, the Chief of the Staffand eight International Secretaries. The total taxable allowances and benefits plus employers NIC of key management personnel were £197k (2017: £222k).
14. TRUSTEES(i) RemunerationThe directors of The Salvation Army International Trustee Company, the fourteen trustees (seeTrustee's report for details), comprise nine senior Salvation Army officers, an employee who acts as Director/Company Secretary and four non-executive directors with specialist expertise.All Salvation Army officers receive an allowance based on length of service and other personal circumstances and, as ministers of religion,are provided with furnished accommodation and transport facilities. The taxable allowances and benefits received during the year by the officers serving as directors ranged from £4,075 to £24,915 (2017: £4,075 to £36,087) and they did not receive any additional remuneration for their duties as directors. The employee serving as Director/Company Secretary received remuneration of £94,716 in the executive role of Head of Finance of the charityand did not receive any additional remuneration for his duties as director.The non-executive directors did not receive any remuneration for their services.
(ii) ExpensesOne trustee received a total of £221 (2017: £187) for travel expenses in their capacity as a director of The Salvation Army InternationalTrustee Company. Expenses paid on behalf of Executive Directors, in respect of their executive roles are not included here.There were no expenses paid to third parties on behalf of the Trustees during the year.
15. AUDIT COSTSThe amount payable to the auditors for the audit of these financial statements amounts to £39,970 excluding VAT (2017: £38,500).Their remuneration for services in connection with audits of African territories amounted to £41,900 excluding VAT (2017: £42,800)and payments to BDO International offices amounted to £269,500 (2017: £354,300).
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
Page 12
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
11. ANALYSIS OF SUPPORT COSTS BY ACTIVITY2018
Charitable Activities Management Finance & ITHuman
Resources Property DepreciationGovernance (see note 12) Total
£000 £000 £000 £000 £000 £000 £000 World Mission 225 202 58 155 223 270 1,133 Assistance to Salvation Army territories 300 269 77 207 297 360 1,510 International Personnel Training and Development 580 520 149 398 574 694 2,915 Crisis Relief 50 45 13 34 50 60 252 Health Services for the Poorest People 30 27 7 21 30 36 151 Fighting Against Sexual Trafficking and for 60 54 15 41 60 72 302 Social Justice
1,245 1,117 319 856 1,234 1,492 6,263
Depreciation on Vehicles and IT Equipment of £122,000 (2017: £124,000) forms part of rechargeable expenditure allocated on a usage basis and is included in the functional headings above.All support costs have been allocated against Charitable Activities (see note 9).
2018 2017£000 £000
12. GOVERNANCE COSTSInternal Audit 440 314External Audit 48 61Legal and Administration (includes Trustees' Indemnity Insurance) 634 310International Child Protection Governance 309 90Finance and Property 61 54
1,492 829
An Internal Audit Department carries out a cycle of reviews of the systems in operation within IHQ and in all countries where The Salvation Army is working.
Page 11
2018 2017£000 £000
13. PERSONNEL COSTSSalaries and Allowances 4,415 4,095Employer's Social Security Costs 424 390Employer's Pension Costs 448 205
5,287 4,690
The number of employees earning greater than £60,000 per annum was as follows: No. No.£60,001 - £70,000 3 2 £70,001 - £80,000 - 1 £80,001 - £90,000 2 1 £90,001 - £100,000 1 - £100,001 - £110,000 - - £110,001 - £120,000 1 1 Included in the above, the highest paid employee had employer pension contributions of £19,154.
Average number of officers and employees 156 150
The key management personnel of The Salvation Army International Trust, comprise the General, the Chief of the Staffand eight International Secretaries. The total taxable allowances and benefits plus employers NIC of key management personnel were £197k (2017: £222k).
14. TRUSTEES(i) RemunerationThe directors of The Salvation Army International Trustee Company, the fourteen trustees (seeTrustee's report for details), comprise nine senior Salvation Army officers, an employee who acts as Director/Company Secretary and four non-executive directors with specialist expertise.All Salvation Army officers receive an allowance based on length of service and other personal circumstances and, as ministers of religion,are provided with furnished accommodation and transport facilities. The taxable allowances and benefits received during the year by the officers serving as directors ranged from £4,075 to £24,915 (2017: £4,075 to £36,087) and they did not receive any additional remuneration for their duties as directors. The employee serving as Director/Company Secretary received remuneration of £94,716 in the executive role of Head of Finance of the charityand did not receive any additional remuneration for his duties as director.The non-executive directors did not receive any remuneration for their services.
(ii) ExpensesOne trustee received a total of £221 (2017: £187) for travel expenses in their capacity as a director of The Salvation Army InternationalTrustee Company. Expenses paid on behalf of Executive Directors, in respect of their executive roles are not included here.There were no expenses paid to third parties on behalf of the Trustees during the year.
15. AUDIT COSTSThe amount payable to the auditors for the audit of these financial statements amounts to £39,970 excluding VAT (2017: £38,500).Their remuneration for services in connection with audits of African territories amounted to £41,900 excluding VAT (2017: £42,800)and payments to BDO International offices amounted to £269,500 (2017: £354,300).
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
Page 12
2018 2017£000 £000
13. PERSONNEL COSTSSalaries and Allowances 4,415 4,095Employer's Social Security Costs 424 390Employer's Pension Costs 448 205
5,287 4,690
The number of employees earning greater than £60,000 per annum was as follows: No. No.£60,001 - £70,000 3 2 £70,001 - £80,000 - 1 £80,001 - £90,000 2 1 £90,001 - £100,000 1 - £100,001 - £110,000 - - £110,001 - £120,000 1 1 Included in the above, the highest paid employee had employer pension contributions of £19,154.
Average number of officers and employees 156 150
The key management personnel of The Salvation Army International Trust, comprise the General, the Chief of the Staffand eight International Secretaries. The total taxable allowances and benefits plus employers NIC of key management personnel were £197k (2017: £222k).
14. TRUSTEES(i) RemunerationThe directors of The Salvation Army International Trustee Company, the fourteen trustees (seeTrustee's report for details), comprise nine senior Salvation Army officers, an employee who acts as Director/Company Secretary and four non-executive directors with specialist expertise.All Salvation Army officers receive an allowance based on length of service and other personal circumstances and, as ministers of religion,are provided with furnished accommodation and transport facilities. The taxable allowances and benefits received during the year by the officers serving as directors ranged from £4,075 to £24,915 (2017: £4,075 to £36,087) and they did not receive any additional remuneration for their duties as directors. The employee serving as Director/Company Secretary received remuneration of £94,716 in the executive role of Head of Finance of the charityand did not receive any additional remuneration for his duties as director.The non-executive directors did not receive any remuneration for their services.
(ii) ExpensesOne trustee received a total of £221 (2017: £187) for travel expenses in their capacity as a director of The Salvation Army InternationalTrustee Company. Expenses paid on behalf of Executive Directors, in respect of their executive roles are not included here.There were no expenses paid to third parties on behalf of the Trustees during the year.
15. AUDIT COSTSThe amount payable to the auditors for the audit of these financial statements amounts to £39,970 excluding VAT (2017: £38,500).Their remuneration for services in connection with audits of African territories amounted to £41,900 excluding VAT (2017: £42,800)and payments to BDO International offices amounted to £269,500 (2017: £354,300).
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
Page 12
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
11. ANALYSIS OF SUPPORT COSTS BY ACTIVITY2018
Charitable Activities Management Finance & ITHuman
Resources Property DepreciationGovernance (see note 12) Total
£000 £000 £000 £000 £000 £000 £000 World Mission 225 202 58 155 223 270 1,133 Assistance to Salvation Army territories 300 269 77 207 297 360 1,510 International Personnel Training and Development 580 520 149 398 574 694 2,915 Crisis Relief 50 45 13 34 50 60 252 Health Services for the Poorest People 30 27 7 21 30 36 151 Fighting Against Sexual Trafficking and for 60 54 15 41 60 72 302 Social Justice
1,245 1,117 319 856 1,234 1,492 6,263
Depreciation on Vehicles and IT Equipment of £122,000 (2017: £124,000) forms part of rechargeable expenditure allocated on a usage basis and is included in the functional headings above.All support costs have been allocated against Charitable Activities (see note 9).
2018 2017£000 £000
12. GOVERNANCE COSTSInternal Audit 440 314External Audit 48 61Legal and Administration (includes Trustees' Indemnity Insurance) 634 310International Child Protection Governance 309 90Finance and Property 61 54
1,492 829
An Internal Audit Department carries out a cycle of reviews of the systems in operation within IHQ and in all countries where The Salvation Army is working.
Page 11
54 ANNUAL REPORT
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
16. PENSION COSTSThe Salvation Army International Trust participates in two separate employee pension schemes, both of which are administered by The Salvation Army United Kingdom Territory with the Republic of Ireland.
It contributes to The Salvation Army Employees’ Pension Fund, a funded defined benefit scheme, in respect of those members of staff thatwere eligible and had joined the scheme prior to its closure to new members on 31 December 2011.The scheme is subject to triennial actuarial valuations. The most recent valuation was performed on 31 March 2015, which reported a shortfall of £5.753 million relative to the technical provisions which corresponded to an on-going funding ratio of 96.0%. It was agreed that the Employerswould fund the shortfall by paying additional contributions over varying periods of up to 3 years. The Salvation Army International Trust tookthe decision to make three annual payments of £530,189, with the final payment made in March 2018.The scheme is a multi-employer scheme incorporating five employers and the actuary has confirmed that it is not practical to allocate the assetsand liabilities of the scheme between participating employers in accordance with FRS102.As at 31 March 2018, the Trust had 45 employees in the scheme out of a total active membership of 510.
A Defined Contributions Scheme was introduced from 1 October 2011 and 36 members of staff of this The Salvation Army International Trusthave joined the scheme. Auto enrolment was adopted from 1 April 2014, with employees required to opt out if they did not want to be part ofthe scheme.The Trust accounts for Pension Costs on the date payments to the Schemes fall due. The costs charged in the current year are disclosed in Note 13.
17. TAXATIONAs a registered charity, the Trust is entitled to exemptions from tax in accordance with the provisions of Section 505 of the Income andCorporation Taxes Act 1988.
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ANNUAL REPORT 55
NO
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
18. MOVEMENT IN FUNDSBalance Transfers Incoming Outgoing Balance
31/03/2017 Resources Resources 31/03/2018£000 £000 £000 £000 £000
RESTRICTEDProperty Fund 15,025 - - (246) 14,779 Other Fixed Assets Fund 766 - - (313) 453 Polignac Trust 2,526 (2,810) 284 - - Officers' Support Endowment Fund 4,394 - 201 - 4,595 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 10,701 (1,887) 3,351 (4,384) 7,781
35,927 (4,697) 3,836 (4,943) 30,123
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).As part of the ongoing reserves review project, following a specific assessment undertaken in consultation with the external auditorsthe Polignac Trust Funds were transferred to designated funds.The Officers' Support Endowment Fund represents restricted funds used to provide grants to Salvation Army officers around the world to assist with basic support costs.The International Social Justice Commission Fund was set up represents restricted funds to support the work of the InternationalSocial Justice Commission office.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2017 Resources Resources 31/03/2018
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 19,718 691 - (702) 19,707 Other Fixed Assets Fund 691 224 - (197) 718
Designated Funds Property Commitments Fund 25,787 340 6,561 (4,677) 28,011 Self-Denial Fund 22,446 (4,546) 25,211 (21,394) 21,717 Investment Appreciation Fund 28,644 - 9,231 (3,023) 34,852 Investment Property Revaluation Fund 34,601 - 3,748 (598) 37,751 Exchange Equalisation Fund 5,115 (500) - (908) 3,707 Other Designated Funds 44,858 9,647 17,621 (7,893) 64,233
161,451 4,941 62,372 (38,493) 190,271
General Reserve 4,378 (1,159) 11,418 (9,306) 5,331 186,238 4,697 73,790 (48,698) 216,027
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£14.71m), and an International Property Project reserve (£6.46m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make operational grants to supported territories payable quarterly in advance. The balance is equivalent to 12.0 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.An International Financial and Accounting Standards Implementation Reserve (£10.00m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years and an IT Development Reserve (£6.43m) is held to fund provision of a new global email solution to territories over the next 3-5 years. An International Schools Development reserve (£7.27m) is also held to provide additional schools project funding to territories over the next 2-4 years and a Mission Support Reserve (£1.52m) is held to provide additional project funding to territories over the next 2-4 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £1.74m wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves. The review also resulted in Polignac Trust Funds (£2.57m) being transferred to designated funds followinga specific assessment undertaken in consultation with the external auditors.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 7.1 months expenditure on headquarters administration costs.
Page 14
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
18. MOVEMENT IN FUNDSBalance Transfers Incoming Outgoing Balance
31/03/2017 Resources Resources 31/03/2018£000 £000 £000 £000 £000
RESTRICTEDProperty Fund 15,025 - - (246) 14,779 Other Fixed Assets Fund 766 - - (313) 453 Polignac Trust 2,526 (2,810) 284 - - Officers' Support Endowment Fund 4,394 - 201 - 4,595 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 10,701 (1,887) 3,351 (4,384) 7,781
35,927 (4,697) 3,836 (4,943) 30,123
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).As part of the ongoing reserves review project, following a specific assessment undertaken in consultation with the external auditorsthe Polignac Trust Funds were transferred to designated funds.The Officers' Support Endowment Fund represents restricted funds used to provide grants to Salvation Army officers around the world to assist with basic support costs.The International Social Justice Commission Fund was set up represents restricted funds to support the work of the InternationalSocial Justice Commission office.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2017 Resources Resources 31/03/2018
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 19,718 691 - (702) 19,707 Other Fixed Assets Fund 691 224 - (197) 718
Designated Funds Property Commitments Fund 25,787 340 6,561 (4,677) 28,011 Self-Denial Fund 22,446 (4,546) 25,211 (21,394) 21,717 Investment Appreciation Fund 28,644 - 9,231 (3,023) 34,852 Investment Property Revaluation Fund 34,601 - 3,748 (598) 37,751 Exchange Equalisation Fund 5,115 (500) - (908) 3,707 Other Designated Funds 44,858 9,647 17,621 (7,893) 64,233
161,451 4,941 62,372 (38,493) 190,271
General Reserve 4,378 (1,159) 11,418 (9,306) 5,331 186,238 4,697 73,790 (48,698) 216,027
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£14.71m), and an International Property Project reserve (£6.46m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make operational grants to supported territories payable quarterly in advance. The balance is equivalent to 12.0 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.An International Financial and Accounting Standards Implementation Reserve (£10.00m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years and an IT Development Reserve (£6.43m) is held to fund provision of a new global email solution to territories over the next 3-5 years. An International Schools Development reserve (£7.27m) is also held to provide additional schools project funding to territories over the next 2-4 years and a Mission Support Reserve (£1.52m) is held to provide additional project funding to territories over the next 2-4 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £1.74m wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves. The review also resulted in Polignac Trust Funds (£2.57m) being transferred to designated funds followinga specific assessment undertaken in consultation with the external auditors.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 7.1 months expenditure on headquarters administration costs.
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THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
18. MOVEMENT IN FUNDSBalance Transfers Incoming Outgoing Balance
31/03/2017 Resources Resources 31/03/2018£000 £000 £000 £000 £000
RESTRICTEDProperty Fund 15,025 - - (246) 14,779 Other Fixed Assets Fund 766 - - (313) 453 Polignac Trust 2,526 (2,810) 284 - - Officers' Support Endowment Fund 4,394 - 201 - 4,595 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 10,701 (1,887) 3,351 (4,384) 7,781
35,927 (4,697) 3,836 (4,943) 30,123
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).As part of the ongoing reserves review project, following a specific assessment undertaken in consultation with the external auditorsthe Polignac Trust Funds were transferred to designated funds.The Officers' Support Endowment Fund represents restricted funds used to provide grants to Salvation Army officers around the world to assist with basic support costs.The International Social Justice Commission Fund was set up represents restricted funds to support the work of the InternationalSocial Justice Commission office.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2017 Resources Resources 31/03/2018
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 19,718 691 - (702) 19,707 Other Fixed Assets Fund 691 224 - (197) 718
Designated Funds Property Commitments Fund 25,787 340 6,561 (4,677) 28,011 Self-Denial Fund 22,446 (4,546) 25,211 (21,394) 21,717 Investment Appreciation Fund 28,644 - 9,231 (3,023) 34,852 Investment Property Revaluation Fund 34,601 - 3,748 (598) 37,751 Exchange Equalisation Fund 5,115 (500) - (908) 3,707 Other Designated Funds 44,858 9,647 17,621 (7,893) 64,233
161,451 4,941 62,372 (38,493) 190,271
General Reserve 4,378 (1,159) 11,418 (9,306) 5,331 186,238 4,697 73,790 (48,698) 216,027
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£14.71m), and an International Property Project reserve (£6.46m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make operational grants to supported territories payable quarterly in advance. The balance is equivalent to 12.0 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.An International Financial and Accounting Standards Implementation Reserve (£10.00m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years and an IT Development Reserve (£6.43m) is held to fund provision of a new global email solution to territories over the next 3-5 years. An International Schools Development reserve (£7.27m) is also held to provide additional schools project funding to territories over the next 2-4 years and a Mission Support Reserve (£1.52m) is held to provide additional project funding to territories over the next 2-4 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £1.74m wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves. The review also resulted in Polignac Trust Funds (£2.57m) being transferred to designated funds followinga specific assessment undertaken in consultation with the external auditors.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 7.1 months expenditure on headquarters administration costs.
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56 ANNUAL REPORT
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AC
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OR
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DED
31
MAR
CH 2
018
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 201818. MOVEMENT IN FUNDS (CONTINUED)
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000RESTRICTEDProperty Fund 15,271 - - (246) 15,025 Other Fixed Assets Fund 1,078 - - (312) 766 Polignac Trust 2,104 - 422 - 2,526 Officers' Support Endowment Fund 3,934 - 460 - 4,394 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 11,884 (666) 3,170 (3,687) 10,701
36,786 (666) 4,052 (4,245) 35,927
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).The Polignac Trust funds were held in investments, with income earned on these funds being utilised for projects within European predominately Catholic countries.The Officers' Support Endowment Fund is generated from donations received from Officers around the World to support Officers withincountries who are unable to fully support their Officers, providing grants to assist with certain support costs.The International Social Justice Commission Fund was set up from funds originally received from the USA Eastern Territory,income generated from these funds is used to support the work of the International Social Justice Commission office based in New York.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 20,086 1,467 - (1,835) 19,718 Other Fixed Assets Fund 696 170 - (175) 691
Designated Funds Property Commitments Fund 27,218 (874) 3,029 (3,586) 25,787 Self-Denial Fund 20,950 (2,374) 25,472 (21,602) 22,446 Investment Appreciation Fund 14,609 - 14,717 (682) 28,644 Investment Property Revaluation Fund 29,385 - 5,375 (159) 34,601 Exchange Equalisation Fund 3,484 - 1,634 (3) 5,115 Other Designated Funds 28,635 3,295 18,329 (5,401) 44,858
124,281 47 68,556 (31,433) 161,451
General Reserve 3,917 (1,018) 9,945 (8,466) 4,378 148,980 666 78,501 (41,909) 186,238
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£13.59m), and an International Property Project reserve (£5.53m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make maintenance grants to supported territories payable quarterly in advance. The balance is equivalent to 12 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.This includes a Mission Support Reserve (£3.23m) held to provide additional project funding to territories over the next 2-4 years and an International Schools Development reserve (£4.53m) held to provide additional school project funding to territories over the next 2-4 years. In addition, an International Financial and Accounting Standards Implementation Reserve (£5.63m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £666k wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 6 months expenditure on headquarters administration costs.
Page 15
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 201818. MOVEMENT IN FUNDS (CONTINUED)
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000RESTRICTEDProperty Fund 15,271 - - (246) 15,025 Other Fixed Assets Fund 1,078 - - (312) 766 Polignac Trust 2,104 - 422 - 2,526 Officers' Support Endowment Fund 3,934 - 460 - 4,394 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 11,884 (666) 3,170 (3,687) 10,701
36,786 (666) 4,052 (4,245) 35,927
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).The Polignac Trust funds were held in investments, with income earned on these funds being utilised for projects within European predominately Catholic countries.The Officers' Support Endowment Fund is generated from donations received from Officers around the World to support Officers withincountries who are unable to fully support their Officers, providing grants to assist with certain support costs.The International Social Justice Commission Fund was set up from funds originally received from the USA Eastern Territory,income generated from these funds is used to support the work of the International Social Justice Commission office based in New York.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 20,086 1,467 - (1,835) 19,718 Other Fixed Assets Fund 696 170 - (175) 691
Designated Funds Property Commitments Fund 27,218 (874) 3,029 (3,586) 25,787 Self-Denial Fund 20,950 (2,374) 25,472 (21,602) 22,446 Investment Appreciation Fund 14,609 - 14,717 (682) 28,644 Investment Property Revaluation Fund 29,385 - 5,375 (159) 34,601 Exchange Equalisation Fund 3,484 - 1,634 (3) 5,115 Other Designated Funds 28,635 3,295 18,329 (5,401) 44,858
124,281 47 68,556 (31,433) 161,451
General Reserve 3,917 (1,018) 9,945 (8,466) 4,378 148,980 666 78,501 (41,909) 186,238
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£13.59m), and an International Property Project reserve (£5.53m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make maintenance grants to supported territories payable quarterly in advance. The balance is equivalent to 12 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.This includes a Mission Support Reserve (£3.23m) held to provide additional project funding to territories over the next 2-4 years and an International Schools Development reserve (£4.53m) held to provide additional school project funding to territories over the next 2-4 years. In addition, an International Financial and Accounting Standards Implementation Reserve (£5.63m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £666k wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 6 months expenditure on headquarters administration costs.
Page 15
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 201818. MOVEMENT IN FUNDS (CONTINUED)
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000RESTRICTEDProperty Fund 15,271 - - (246) 15,025 Other Fixed Assets Fund 1,078 - - (312) 766 Polignac Trust 2,104 - 422 - 2,526 Officers' Support Endowment Fund 3,934 - 460 - 4,394 Int'l Social Justice Commission Fund 2,515 - - - 2,515 Other Restricted 11,884 (666) 3,170 (3,687) 10,701
36,786 (666) 4,052 (4,245) 35,927
The Property Fund represents restricted funds used for specific property acquisitions. The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).The Polignac Trust funds were held in investments, with income earned on these funds being utilised for projects within European predominately Catholic countries.The Officers' Support Endowment Fund is generated from donations received from Officers around the World to support Officers withincountries who are unable to fully support their Officers, providing grants to assist with certain support costs.The International Social Justice Commission Fund was set up from funds originally received from the USA Eastern Territory,income generated from these funds is used to support the work of the International Social Justice Commission office based in New York.All other restricted reserves are funds held for specific overseas areas of work.
Balance Transfers Incoming Outgoing Balance31/03/2016 Resources Resources 31/03/2017
£000 £000 £000 £000 £000UNRESTRICTEDProperty Fund 20,086 1,467 - (1,835) 19,718 Other Fixed Assets Fund 696 170 - (175) 691
Designated Funds Property Commitments Fund 27,218 (874) 3,029 (3,586) 25,787 Self-Denial Fund 20,950 (2,374) 25,472 (21,602) 22,446 Investment Appreciation Fund 14,609 - 14,717 (682) 28,644 Investment Property Revaluation Fund 29,385 - 5,375 (159) 34,601 Exchange Equalisation Fund 3,484 - 1,634 (3) 5,115 Other Designated Funds 28,635 3,295 18,329 (5,401) 44,858
124,281 47 68,556 (31,433) 161,451
General Reserve 3,917 (1,018) 9,945 (8,466) 4,378 148,980 666 78,501 (41,909) 186,238
The Property Fund represents funds which have been utilised to finance the acquisition of freehold and leasehold properties.
The Other Fixed Assets Fund represents funds which have been used to finance the acquisition of Other Tangible FixedAssets (per Note 21).
The Property Commitments Fund represents funds earmarked for future property acquisitions and schemes. This includes areserve held to fund the future replacement of the IHQ building (£13.59m), and an International Property Project reserve (£5.53m)held to provide additional property project funding to territories over the next 2-4 years.The Self-Denial Fund represents amounts held to ensure sufficient funds are available to meet the commitment to make maintenance grants to supported territories payable quarterly in advance. The balance is equivalent to 12 monthsof the budgeted grants and support costs payable to overseas territories for the following year.The Investment Appreciation Fund represents unrealised gains on investments which are still subject to market risk.The Investment Property Revaluation Fund represents the surplus on revaluation of tenanted properties held for investment purposes.The Exchange Equalisation Fund represents exchange gains made and held to offset future exchange losses.Other Designated Funds are held for particular purposes designated by the directors in the exercise of their discretionary powers.This includes a Mission Support Reserve (£3.23m) held to provide additional project funding to territories over the next 2-4 years and an International Schools Development reserve (£4.53m) held to provide additional school project funding to territories over the next 2-4 years. In addition, an International Financial and Accounting Standards Implementation Reserve (£5.63m) is held to fund provision of cloud-based accounting software to territories over the next 3-5 years.
As part of the ongoing reserves review project (seeking to reduce the number of different funds held), an amount of £666k wastransferred from restricted reserves where the original donor restriction allowed to partly fund grants to territories initially expended from designated reserves.
The General Reserve represents the working capital required to fund the day-to-day needs of The Salvation Army International Trust,and is equivalent to 6 months expenditure on headquarters administration costs.
Page 15
ANNUAL REPORT 57
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TES TO TH
E AC
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TS FOR TH
E YEAR END
ED 31 M
ARCH 2018
19. ANALYSIS OF NET ASSETS BETWEEN FUNDSUnrestricted Restricted Unrestricted Restricted
Funds Funds Total Funds Funds Total2018 2017
£000 £000 £000 £000 £000 £000
Property Assets 13,907 14,779 28,686 13,918 15,025 28,943Other Tangible Fixed Assets 718 453 1,171 691 766 1,457Investments 172,927 14,891 187,818 141,412 20,214 161,626Current Assets 35,163 - 35,163 34,746 - 34,746Current Liabilities (6,921) - (6,921) (4,778) (78) (4,856) Debtors over one year 233 - 233 249 - 249
216,027 30,123 246,150 186,238 35,927 222,165
20. PROPERTY ASSETSLong
Freehold Leasehold Overseas Total£000 £000 £000 £000
CostBalance at 1 April 2017 29,830 7,398 391 37,619Additions during the year 467 345 - 812Transfers 145 95 - 240
30,442 7,838 391 38,671Less: Disposals - (60) (165) (225) Transfer to Investment Property (262) (87) - (349) Balance at 31 March 2018 30,180 7,691 226 38,097
DepreciationBalance at 1 April 2017 6,895 1,692 89 8,676Reinstated on Transfer from Investment Property 61 26 - 87Charge for the year 688 153 5 846
7,644 1,871 94 9,609Eliminated: on Disposals - (27) (76) (103) on Transfer to Investment Property (63) (32) - (95) Balance at 31 March 2018 7,581 1,812 18 9,411
Net Book Value at 31 March 2018 22,599 5,879 208 28,686
Net Book Value at 31 March 2017 22,935 5,706 302 28,943
The Transfer to Investments relates to tenanted properties that are held for investment purposes.
21. OTHER TANGIBLE FIXED ASSETSOffice IT
Fit-Outs Equipment Equipment Vehicles Total£000 £000 £000 £000 £000
CostBalance at 1 April 2017 5,253 1,055 501 59 6,868Additions during the year - - 225 - 225
5,253 1,055 726 59 7,093Less Disposals - - (118) - (118)Balance at 31 March 2018 5,253 1,055 608 59 6,975
DepreciationBalance at 1 April 2017 4,068 1,055 229 59 5,411Charge for the year 351 - 160 - 511
4,419 1,055 389 59 5,922Eliminated on disposals - - (118) - (118)Balance at 31 March 2018 4,419 1,055 271 59 5,804
Net Book Value at 31 March 2018 834 - 337 - 1,171
Net Book Value at 31 March 2017 1,185 - 272 - 1,457
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
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58 ANNUAL REPORT
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AC
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OR
THE
YEAR
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31
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CH 2
018
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
22. INVESTMENTSCost Market Cost Market
Value Value£000 £000 £000 £000
(a) TrustListed Investments Fixed Interest UK Government 18,329 19,130 14,231 15,539 Overseas 460 456 517 518 Equities UK Directly Held Equities 6,548 6,860 5,855 5,671 Overseas Directly Held Equities 68,528 81,883 62,185 73,136
93,865 108,329 82,788 94,864Investment in Joint Venture (Note 3) Reliance Bank Ltd. - Shares 3,825 3,825 3,825 3,825Investment Property (see Note (e) below) 8,202 45,910 7,980 42,538Property - Freehold Reversionary Interest 2,990 5,800 2,990 5,800 (see Note (f) below)Bank Deposits 23,954 23,954 14,599 14,599
132,836 187,818 112,182 161,626
(b) Bank Deposits 2018 2017£000 £000
Sterling - Notice Deposits (less than 3 months) 3,900 4,500Sterling - Notice Deposits (greater than 3 months) 2,200 1,350US Dollars & Euros 4,284 4,785US Dollars & Euros - Notice Deposits (greater than 3 months) 1,070 3,207Cash held by Investment Managers 12,500 757
23,954 14,599
(c) Movement in Listed InvestmentsMarket Value at 1 April 2017 94,864 73,846Purchases in year 41,892 73,105Sales proceeds (33,941) (66,840)Net Gains/(Losses) - Listed Investments 5,514 14,753Market Value at 31 March 2018 108,329 94,864
(d) Gains/(Losses) on Investment AssetsListed Investments (see Note (c) above) 5,514 14,753Net Surplus on revaluation of Investment Property 3,728 5,439Release of revaluation surplus on transfer of Investment Property to Fixed Assets (484) - Gain/(Loss) on revaluation of US Dollar Deposits (649) 7Gain/(Loss) on US held investments 3,168 967
11,277 21,166
(e) Investment PropertyThe investment property represents tenanted properties that are held for investment purposes. During the year there were additions to investment property at a depreciated cost of £368,313 and fair value as at 31 March 2018 of £2,366,000 giving rise to a revaluation gain of £1,997,687.As part of the three-year revaluation rolling plan, forty-three investment properties have been valued at fair value as at31 March 2018 resulting in an additional revaluation gain of £1,730,750.During the year no properties were sold and two properties were transferred back to Fixed Assets.Valuations are provided using the comparison method, with the majority of valuations being completed by an External Chartered Surveyor andthe rest conducted in-house by the Property Manager who holds a Bachelor of Science degree which included a valuation module.
(f) Property - Freehold Reversionary InterestThe freehold reversionary interest represents the value of the freehold interest in 99 Queen Victoria Street(adjacent to the headquarters building) on which a long lease has been granted and rental incomeof £217,756 per annum is receivable. The freehold reversionary interest has been valued at the year end by the Trustee,based on advice from an external consulting surveyor, at £5.80 million (£5.80 million: 2017)
2018 2017
Page 17
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
22. INVESTMENTSCost Market Cost Market
Value Value£000 £000 £000 £000
(a) TrustListed Investments Fixed Interest UK Government 18,329 19,130 14,231 15,539 Overseas 460 456 517 518 Equities UK Directly Held Equities 6,548 6,860 5,855 5,671 Overseas Directly Held Equities 68,528 81,883 62,185 73,136
93,865 108,329 82,788 94,864Investment in Joint Venture (Note 3) Reliance Bank Ltd. - Shares 3,825 3,825 3,825 3,825Investment Property (see Note (e) below) 8,202 45,910 7,980 42,538Property - Freehold Reversionary Interest 2,990 5,800 2,990 5,800 (see Note (f) below)Bank Deposits 23,954 23,954 14,599 14,599
132,836 187,818 112,182 161,626
(b) Bank Deposits 2018 2017£000 £000
Sterling - Notice Deposits (less than 3 months) 3,900 4,500Sterling - Notice Deposits (greater than 3 months) 2,200 1,350US Dollars & Euros 4,284 4,785US Dollars & Euros - Notice Deposits (greater than 3 months) 1,070 3,207Cash held by Investment Managers 12,500 757
23,954 14,599
(c) Movement in Listed InvestmentsMarket Value at 1 April 2017 94,864 73,846Purchases in year 41,892 73,105Sales proceeds (33,941) (66,840)Net Gains/(Losses) - Listed Investments 5,514 14,753Market Value at 31 March 2018 108,329 94,864
(d) Gains/(Losses) on Investment AssetsListed Investments (see Note (c) above) 5,514 14,753Net Surplus on revaluation of Investment Property 3,728 5,439Release of revaluation surplus on transfer of Investment Property to Fixed Assets (484) - Gain/(Loss) on revaluation of US Dollar Deposits (649) 7Gain/(Loss) on US held investments 3,168 967
11,277 21,166
(e) Investment PropertyThe investment property represents tenanted properties that are held for investment purposes. During the year there were additions to investment property at a depreciated cost of £368,313 and fair value as at 31 March 2018 of £2,366,000 giving rise to a revaluation gain of £1,997,687.As part of the three-year revaluation rolling plan, forty-three investment properties have been valued at fair value as at31 March 2018 resulting in an additional revaluation gain of £1,730,750.During the year no properties were sold and two properties were transferred back to Fixed Assets.Valuations are provided using the comparison method, with the majority of valuations being completed by an External Chartered Surveyor andthe rest conducted in-house by the Property Manager who holds a Bachelor of Science degree which included a valuation module.
(f) Property - Freehold Reversionary InterestThe freehold reversionary interest represents the value of the freehold interest in 99 Queen Victoria Street(adjacent to the headquarters building) on which a long lease has been granted and rental incomeof £217,756 per annum is receivable. The freehold reversionary interest has been valued at the year end by the Trustee,based on advice from an external consulting surveyor, at £5.80 million (£5.80 million: 2017)
2018 2017
Page 17
ANNUAL REPORT 59
NO
TES TO TH
E AC
CO
UN
TS FOR TH
E YEAR END
ED 31 M
ARCH 2018
2018 2017£000 £000
23. DEBTORS AND PREPAYMENTSDue from Salvation Army territories 4,977 4,968Funds held in USA 27,535 28,210Prepayments 945 348Other Debtors 700 691Amounts falling due after more than one year: Loans due from Salvation Army territories. 233 249
34,390 34,466
24. BANK BALANCESSterling - Interest-bearing current accounts 710 229 - Ordinary current accounts 161 136US Dollars and Euros 2 3
873 368
25. CURRENT LIABILITIESDue to Salvation Army territories 5,466 3,034Salvation Army Employees' Pension Fund (payable March 2018) - 530Accruals 1,455 1,292
6,921 4,856
26. OPERATING LEASE COMMITMENTSAt the 31 March 2018 The Salvation Army International Trust were committed to making the following payments inrespect of operating leases:
2018 2017£000 £000
Within one year 95 104Between one to five years 165 260After five years - -
260 364
27. CAPITAL COMMITMENTSThere were no capital commitments at the year end.
28. RELATED PARTY TRANSACTIONSThe Salvation Army International Trust receives contributions for the International Self-Denial Fund and towards International Programme Support and Administration from Salvation Army territories (see Note 2).As part of the programme of work overseas, financial support is provided to The Salvation Army in developing overseas territories in the form of maintenance grants (see Note 10).
The International Trust has a 51% interest in Reliance Bank Limited. Related party transactions between the two entities during the financial year include bank interest received, of £84k (£60k : 2017), donation received of £129k (£nil : 2017), services invoiced £11k (£12k: 2017), rent and services paid of £24k (£26k: 2017) and bank charges paid of £13k (£10k: 2017)
29. ULTIMATE CONTROLLING PARTYThe charity is controlled by The Salvation Army International Trustee Company (SAITCo), a company limited by guarantee (company registration no. 2538134). SAITCo is appointed as the ordinary Trustee of The Salvation Army International Trust.
THE SALVATION ARMY INTERNATIONAL TRUST
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2018
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60 ANNUAL REPORT
WORLDWIDE FACTS AND
FIGURES
ANNUAL REPORT 61
EDUCATION PROGRAMMEKindergarten/sub primary 937Primary schools 3,129Secondary and high schools 404Colleges and universities 12Vocational training schools/centres 80Pupils 616,996Teachers 20,114 Schools for blind students (included in above totals) 25 Schools for disabled students (included in above totals) 28 Boarding schools (included in above totals) 101Staff training and development centres 35Learning centres 8
62 ANNUAL REPORT
WORLDWIDE FACTS AND FIGURES
AT A GLANCE
THE SALVATION ARMY
Countries and territories where SA serves 131Corps, outposts, societies, new plants and recovery churches 14,527Goodwill centres 236Officers 26,943 Active 17,168 Retired 9,775Auxiliary-captains 230Envoys/sergeants/non officer personnel, full-time 880Cadets 1,050Employees 111,859Senior soldiers 1,182,100Adherents 175,811Junior soldiers 411,327Corps cadets 43,648Senior band musicians 27,626Senior songsters 115,050Other senior musical group members 111,625Senior and young people’s local officers 160,861Women’s Ministries (all groups) members 766,369League of Mercy – members 189,378SAMF – members 7,391Over-60 clubs – members 89,288Men’s fellowships – members 97,220Young people’s bands – members 13,949Young people’s singing companies – members 102,375Other young people’s music groups – members 152,369Sunday schools – members 706,325Junior youth groups
(scouts, guides, etc, and clubs) – members 152,405Senior youth groups – members 160,291Corps-based community development programmes 1,626Beneficiaries/clients 634,053 Thrift stores/charity shops (corps/territorial) 1,427Recycling centres 33
ADDICTION DEPENDENCYNon-residential programmes 124 Capacity 2,807Residential programmes 216 Capacity 16,299Harbour Light programmes 55 Capacity 2,475Other services for those with addictions 35 Capacity 860
SERVICES TO THE ARMED FORCESMobile units for service personnel 11Chaplains 27
SOCIAL PROGRAMMEResidentialHostels for the homeless 461 Capacity 28,780Emergency lodges 404 Capacity 21,737Children’s homes 235 Capacity 7,829Homes for elderly persons 180 Capacity 12,857Homes for disabled persons 39 Capacity 1,062Homes for blind persons 8 Capacity 398Remand and probation homes 68 Capacity 1,190Mother and baby homes 36 Capacity 908Training centres for families 69 Capacity 387Care homes for vulnerable people 11 Capacity 302Women’s and men’s refuge centres 96 Capacity 2,210Other residential care homes/hostels 67 Capacity 4,842
ANNUAL REPORT 63
THE SA
LVATIO
N A
RMY W
ORLD
WID
E FAC
TS AN
D FIG
URES
DAY CARECommunity centres 556 Capacity 270,507Early childhood education centres 937 Capacity 55,030Day centres for the elderly 98 Capacity 16,279Play groups 439 Capacity 10,258Day centres for street children 11 Capacity 699Day nurseries 277 Capacity 17,916Drop-in centres for youth 343 Capacity 25,991Other day care centres 106 Capacity 7,482
HEALTH PROGRAMMEGeneral hospitals 29 Capacity 2,065Hospice long term care 11 Capacity 251Maternity hospitals 32 Capacity 4,471Other specialist hospitals 62
Capacity 1,828Specialist clinics 346 Capacity 3,139General clinics/health centres 115
Capacity 4,753Mobile clinics/community health posts 194,601Inpatients 332,734Outpatients 1,215,962Doctors/medics 3,984Non medical staff 2,158Invalid/convalescent homes 4 Capacity 557Health education programmes (HIV/Aids, etc) 13
Beneficiaries 1,790,623Day care programmes 33
EMERGENCY DISASTER RESPONSEDisaster rehabilitation schemes 43 Participants 15,651Refugee programmes – host country 33 Participants 16,053Refugee rehabilitation programmes 20 Participants 36,964Other response programmes 221 Participants 34,479
!
SERVICES TO THE COMMUNITYPrisoners visited 247,794Prisoners helped on discharge 81,226Police courts – people helped 247,262Missing persons – applications 7,707
Number traced 2,670Night patrol/anti-suicide – number helped 352,932Employment bureaux – applications 74,110
Initial referrals 72,336 Counselling – people helped 293,464 General relief – people helped 13,428,448
Emergency relief (fire, flood, etc) – people helped 438,298Emergency mobile units 2,109Feeding centres 1,399Restaurants and cafés 52Thrift stores/charity shops (social) 1,111Apartments for elderly 924
Capacity 4,110Hostels for students, workers, etc 48
Capacity 1,760Land settlements (SA villages, farms etc)
Capacity 516Social Services summer camps 358
Participants 73,262
*●Source of statistics: The Salvation Army Year Book 2018 (pages 30-31)
64 ANNUAL REPORT
