KCHC Annual Report and Accounts 2024-25 Spreads - Flipbook - Page 49
Notes to the financial statements
They are accounted for on an accruals basis where the
conditions for their payment have been met or where
a third party has a reasonable expectation that they
will receive the grant and when the liability can be
quantified with reasonable certainty.
c) Support costs
Support costs, which include governance costs,
relate to those functions that assist the work of the
Charity but are not directly undertaking fundraising
or charitable activities. These costs have been
apportioned between the cost of raising funds and
expenditure on charitable activities based on the
estimated proportion of staff time engaged in these
activities.
d) Irrecoverable VAT
Irrecoverable VAT is charged as a cost against the
activity for which the expenditure was incurred.
1.4. Employee benefits
The costs of short-term employee benefits are
recognised as a liability and an expense..
Depreciation
The IT equipment and software are depreciated over
the expected economic life of three years. Furniture,
fixtures and fittings are depreciated over the expected
economic life of five years.
As at the balance sheet date, there was no indication
that the recoverable amount of any fixed asset was
below its net book value.
Where fixed assets have been revalued, any excess
between the cost and the revalued amount would be
shown in a revaluation reserve.
1.8. Investments
Investment fixed assets are shown at market value.
Valuation gains and losses are recorded in the
statement of financial activities as they arise with the
balance sheet reflecting the re-valued amounts.
Realised gains and losses on investments are
calculated as the difference between sales proceeds
and opening market value (or date of purchase if later).
Unrealised gains and losses are calculated as the
difference between market value at the year end and
opening market value (or date of purchase if later).
1.5. Pensions contributions
Pension costs for all staff are charged to the statement
of financial activities when they become due. All
contributions are to defined contribution schemes.
Apportionment of investment management costs
between funds (where this information is not provided
by the investment manager) is done pro rata according
to the respective market values.
1.6. Taxation
The Charity is considered to pass the tests set
out in Paragraph 1 Schedule 6 of the Finance Act
2010 and therefore it meets the definition of a
charitable company for UK corporation tax purposes.
Accordingly, the Charity is potentially exempt from
taxation in respect of income or capital gains received
within categories covered by Chapter 3 Part 11 of
the Corporation Tax Act 2010 or Section 256 of the
Taxation of Chargeable Gains Act 1992, to the extent
that such income or gains are applied exclusively to
charitable purposes.
1.9. Cash and cash equivalents
Cash and cash equivalents include cash in hand,
deposits held at call with banks and other financial
institutions, other short-term liquid investments with
original maturities of three months or less.
1.10. Financial instruments
1.7. Tangible fixed assets
The Charity has elected to apply the provisions of
Section 11 ‘Basic Financial Instruments’ and Section
12 ‘Other Financial Instruments Issues’ of FRS 102 to
all of its financial instruments.
Capitalisation
Assets are capitalised at cost if they individually or
collectively, if purchased in a group, cost more than
£1,000. The only assets capitalised comprise furniture,
fixtures and fittings, IT equipment and software.
Financial instruments are recognised in the Charity’s
balance sheet when the Charity becomes party to the
contractual provisions of the instrument. Financial
assets and liabilities are offset, with the net amounts
presented in the financial statements, when there
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