2008 Annual Review. Page 8.
Reserves policy
As the Hospice receives the majority of its income from fundraising, supported by service level agreements with Harrow & Brent Primary Care Trusts, it needs to ensure that it has a sufficient reserve of funds available to meet unexpected shortfalls in such funding through external events beyond its control.
The Trustees' target is to hold free reserves and designated investment reserves equating to six months of expenditure so that the Hospice is able to manage any unexpected shortfall in income to protect the needs of the patients served and also to give a reassurance of security for the staff. Elsewhere reported is the decision to withdraw from the Clock Cottage purchase, for which funds had previously been set aside in a designated fund, and also the plan to conduct a full remuneration review in 2009 with a significant uplift to the level of pay for nurses and HCAs. Some of the funds released from the Clock cottage designation can now be set aside for this project and also to provide new space, should trust funding not materialise.
Opportunities will be taken whenever possible within the constraints of income receivable against ongoing expenditure requirements, to build the current level of free reserves and the long term reserve fund to the target level.
At the end of 2008 free reserves stand at 1.4 months and the invested long-term reserve stands at a further 2.5 months of average budgeted expenditure for the forthcoming year.
The Finance & General Purposes Committee reviews the level of reserves and considers any amendments to the policy which may be necessary and reports its.conclusions to the Board.
ST LUKE'S HOSPICE (HARROW AND BRENT) LIMITED
Summarised Financial Statements for the year ended 31st December 2008
CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES
| 2008 | 2007 | |
| £′000 | £′000 | |
| Incoming resources | ||
| Donations | 527 | 435 |
| Legacies | 345 | 854 |
| Trusts | 264 | 158 |
| Fundraising Events | 308 | 271 |
| Gross Income from shops and lottery | 1,567 | 1,411 |
| Investment Income | 78 | 77 |
| NHS Commissioning & other grants | 1,399 | 1,137 |
| Total Incoming resources | 4,488 | 4,343 |
| Resources Expended | ||
| Fundraising costs general | 241 | 241 |
| Fundraising events costs | 144 | 142 |
| Gross expenditure of shops and lottery | 1,194 | 1,066 |
| Investment management costs | 5 | 6 |
| Inpatient Services | 1,034 | 1,092 |
| Daycare Services | 226 | 205 |
| Homecare Services | 458 | 395 |
| Overall Clinical Support | 1,112 | 1,113 |
| Governance costs | 70 | 53 |
| Total Resources expended | 4,484 | 4,313 |
| Net Incoming resources | 4 | 30 |
| Realised gains/(losses) on investment disposals | - | (16) |
| Unrealised gains/(losses) on revaluation of investments | (319) | (95) |
| Net movement in funds in year | (315) | 51 |
| Total Funds brought forward at 1 January | 6,466 | |
| Total Funds carried forward at 31 December | 6,070 | 6,385 |