here - Smile International

Financial Statements for the Year ended 31 March 2011 (Charity Number 1079730)
SMILE INTERNATIONAL
CONTENTS
Page
Reference and administrative details of the charity, its trustees and advisers
1
Trustees' report
2 - 12
Independent auditors' report
13 - 14
Statement of financial activities
15
Balance sheet
16
Notes to the financial statements
17 - 25
SMILE INTERNATIONAL
REFERENCE AND ADMINISTRATIVE DETAILS OF THE CHARITY, ITS TRUSTEES AND ADVISERS
FOR THE YEAR ENDED 31 MARCH 2011
Trustees
The Council of Reference
Mrs Geraldine Alliston
Mr Roger Brown
Mr Graham Garner
Rev Canon Michael Adams
Rev Dr David Coffey
Professor Brian Stanley
Charity registered number
1079730
Principal office
PO BOX 3
Orpington
BR5 1WZ
Chief executive officer
Rev Clive Doubleday
Auditors
Hedley Dunk Limited
Chartered Accountants
Trinity House
3 Bullace Lane
Dartford
Kent
DA1 1BB
Bankers
HSBC
Petts Wood
Orpington
Kent
BR5 1LR
Page 1
SMILE INTERNATIONAL
TRUSTEES' REPORT
FOR THE YEAR ENDED 31 MARCH 2011
OVERVIEW
“A man can receive only what is given him from heaven.” John 3:27
Smile International is a charity dedicated to sharing the love of Jesus Christ by helping to relieve suffering and poverty
through the distribution of humanitarian aid and long-term development projects. Our principal areas of activity are in
Africa, Asia and Europe, but in the last year we have also provided
support for earthquake victims in Haiti.
The Trustees have ensured that Smile remains committed to the longterm rebuilding of lives by sharing, in practical ways, God’s
unconditional love for a needy world.
The strategic review we undertook in 2009 continues to determine our
priorities so that our focus has been on consolidating existing
projects, streamlining our fundraising, simplifying our funds and
building our core competencies to create a firm platform for growth.
Smile’s Five Year Vision (200914): We aim to support 5,000 of
the world’s most needy children
and families and to see 500 people
join our Step Out programme
every year.
Despite the continued difficulties of the current economic climate, the uncertainty of exchange rates and the rising costs
of food and fuel, Smile has continued to grow in the amount of humanitarian aid sent out, the numbers joining our Step
Out and Gap Year trips and the number of children and widows supported. Substantial progress has also been made on a
number of long term projects. In all this, Smile has depended crucially on the financial generosity of supporters, the
impressive contribution of time and skills from our volunteers and our team of devoted staff at home and abroad.
OUR AIMS
To transform whole lives – body and soul – of the most vulnerable people who have been damaged by war, poverty,
illness and natural disaster
•
•
•
•
•
To release Christians of all ages for mission
To work in effective partnerships to make a real difference to those in need
To be an organisation where every person and gift of time, money or goods is used to best effect and which
exercises good stewardship of resources
To keep our supporters well informed about activities
To be an equal opportunity employer, training and developing our staff and volunteers to be effective in their
work and ministry
OUR APPROACH
Smile’s work is encapsulated by our strap-line: PRAY – GIVE – GO
PRAY
We are a faith-driven organisation dependent on continuing prayer support
GIVE
We depend on your generosity (individuals, churches and organizations)
GO
We achieve our project goals and release Christians into ministry by
encouraging them to step out of their comfort zone and minister to those in areas
of need
Page 2
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
ACTIVITIES
Running sponsorship schemes and raising funds for projects and general work
Smile has not been immune to the difficulties of the current economic climate which has affected the ability of our
regular supporters to give and reduced sources of grant funding, despite our fundraising efforts. The Trustees and
management team continued to target fundraising at developing our broad range of work in each territory, rather than on
smaller initiatives, and allow our managers and partners on the ground to prioritise activities based on their knowledge of
local needs in line with achieving the agreed objectives. Savings have also been made by setting budgets and allowing
each territory to manage their own budgets. In order to save costs we had to cut staff and leave some posts unfilled as a
temporary measure.
Income
Overall income levels were £1,195,530 in 2010/11, an
increase of 13.5% mainly as a result of a significant
increase in Gifts in Kind (37%). Cash income decreased
by £66,000 (11%). Income through sponsorship (children,
widows and pastors) programme declined slightly but trip
income showed a slight growth.
Expenditure
As a result of the increased volume of aid and investment
in capacity building as a platform for growth, expenditure
was 30% higher than in 2010. Our aim is to transfer funds
to overseas projects as quickly as possible but some new
projects require us to accumulate funds before they can be
started. We endeavoured to keep administration costs to a
minimum and currently 92% of our expenditure is directly
linked to projects.
SPONSORSHIP PROGRAMMES
Child sponsorship
Number sponsored
Our Child Sponsorship programme continued and, by
the end of the year we had 454 sponsored children,
slightly down on last year as some older children came
off the programme and as we targeted India, Kosova and
Zimbabwe. Nevertheless we continue to support more
children than are sponsored.
Page 3
2009/10
2010/11
Zimbabwe
84
105
Uganda
230
209
Sri Lanka
126
93
Zambia
7
7
India
32
35
Kosova
1
5
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Widow sponsorship
Number sponsored
2009/10
2010/11
Kosova
32
40
Uganda
12
12
Sri Lanka
27
24
Zimbabwe
13
15
This scheme helps widows with basic essentials like
flour, oil, detergents and wood for cooking and heating
as well as fellowship. This year we sponsored 93
widows (an increase of 11 per cent). We continue to
review those sponsored to ensure that support goes to
those in greatest need. It has been particularly rewarding
to see some of our sponsored widows develop skills
through our microenterprise projects that have enabled
them to become self sufficient.
Pastor sponsorship
India
2
Number sponsored
2009/10
2010/11
India
3
3
Sri Lanka
4
5
Zimbabwe
8
7
This programme support needy Pastors whose
congregations are too poor to help them with basic
living expenses, books or the means to travel. At the end
of the year, 15 Pastors were being supported.
SUSTAINABLE PROJECTS AND EMERGENCY AID
By collecting and distributing aid
Figure 1 Our aid coordinator ready to
close up a full sea container
Figure 2 The warehouse where aid is sorted and stored.
We received aid donations to the value of £670k, a 37% increase on last year which we were able to
accommodate because of the free loan of a 14,000 sq feet warehouse managed by Linays & Shipp Estate Agents
(value £30k). We sent two 40ft lorry loads to Kosova and Romania, three 20ft sea containers (two to Zimbabwe
and one to the Gambia). A fourth arrived in Haiti. Particularly generous donations included school uniforms
(value £127k) from The School Trading Company; over 4,000 pairs of shoes, mostly from Russell and Bromley,
27 items of hospital furniture (beds, cots and lockers) from a hospital in Bath and 2 ultrasound scanners; recycled
boxes from Arco (value £4k); discounted storage from Access Storage (value £2k); storage from Big Yellow
(value £1,200), Prima Tape and Labels (value £1k); and 6 month rent and council tax free use of two shops by
Bromley Council (value £12k). Our knitters continued to be productive and we have been able to distribute over
7,000 boxes of knitted clothes and nearly 2,500 blankets.
Page 4
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Hope for Haiti
Through the generous support of Smile the Haiti Hospital Appeal has been able to provide a significant amount
of support to some of the worst affected individuals of the 2010 earthquake. Within a week of receiving the
donations we were undertaking weekly distributions to schools, which had been unable to re-open after the
earthquake because of a lack of equipment; tent cities which hadn’t received any aid in the aftermath of the
disaster; and specific vulnerable families with disabilities.
Figure 3 Aid distribution in Haiti
We will never forget seeing the joy brought to one particular tent city in Port au Prince. The shabby tents
erected just minutes away from the mass graves, went as far as the eye could see. We were horrified that the
aid we were offering through Smile was the first they’d received, 6 months after the earthquake. The
supplies also provided valuable support to our spinal cord injury (SCI) patients in the North, caring for 24
paraplegic patients and 1 quadriplegic patient. One lost his 8 children, wife, home and work and was then hit
with the tragic reality that he’d probably never walk again. The love offered to such individuals through
Smile delivered renewed hope, courage and determination. The individuals realised that these gifts had
been sent by people who cared. Just over a year on, and of the 22 earthquake-related patients we received, 21
have miraculously successfully been rehabilitated. Without the support of groups like Smile this wouldn’t have
been possible. Smile’s commitment, dedication and compassion not only transformed lives, but also
helped save lives.
However, even before the earthquake, Haiti was the poorest country in the western hemisphere, and, whilst the
world’s attention was on those affected by the earthquake, there were many other families living in desperate
poverty. The gifts of Smile also helped to transform the lives of children in the north. This included our respite
centre for children with physical and mental special needs. 10% of children in Haiti have a disability, and are
often treated appallingly. They are commonly viewed as worthless, being left at home and never integrated into
mainstream life. The support of Smile helped us to provide urgently-needed care to some of these families, a
forgotten group of people, in desperate need of care.
On behalf of everyone at the Haiti Hospital Appeal and all those that Smile helped, we’d like to thank everyone
for their loving support during that devastating time. Smile was an incredible blessing, and we look forward to
developing future work with them.
Carwyn Hill, CEO & Co-Founder of Haiti Hospital Appeal
Page 5
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Shoeboxes and Harvest appeal
With the help of over 100 volunteers we collected and sorted over 10,000 shoeboxes. We received just over £3.5k under
the Sponsor a Shoebox scheme with which we purchased culturally relevant gifts in the destination countries. From an
accumulation of large and small donations we were able to send £127,000 worth of educational materials (such as
stationery, pens, geometry sets and craft materials) together with over 6,000 school text books.
By establishing Smile Centres in key locations as self-supporting centres to provide bases, as appropriate, for
education, health care, Christian training, child care, feeding, aid distribution and Step Out trips.
Kosova
The Smile Centre in Kosova continued to be the base for our work in the
Balkans including Step Out Trips, Career Breaks and Gap Year students
and is used increasingly by other Christian organisations for conferences
and by Pastors and other Christians for retreats. We have also held
widows’ days and conferences and hosted a special day for the blind. The
move to having local Centre Managers and Project Coordinator has run
smoothly and enabled us to expand our work with widows and children.
We laid firm foundations for our Palliative care project, with the signing
of a Memorandum of Understanding with the Mayor of Gjakova and the
appointment of a doctor to oversee the project.
Mary’s Marathon
Smile Regional Coordinator,
Mary Knight led 27 meetings in
Kosova and Macedonia,
including 2 women’s
conferences, in 14 days.
“The quality of Mary’s
teaching was such a blessing
and encouragement to
everyone.”
Pastor Goran Iliev Negotino,
Macedonia
Africa
The Smile Centre in Zimbabwe continued to be used for
Step Out Trips, Gap Year and Career Breaks and the base
from which our programmes were run, particularly the
feeding programme for 1,800 children each day in five
schools. Our team has helped to transform the future of
these children, ensuring that they have the nutrition they
need to have the energy to learn and develop to their full
potential. We rebuilt the cookhouse at Molife Methodist
School after the original one was destroyed by fire.
Figure 4 Feeding time in Zimbabwe
We continued the twinning programme between several UK
schools and schools in Zimbabwe and continued HIV/AIDS
awareness seminars and adult literacy groups in Molife and
Mukombami villages. We were able, for the first time, to
run holiday Bible clubs at St Jude’s and Molife schools for
over 300 children. We also provided tailoring skills for
over 400 women so they can become self-sufficient.
We developed a considerable number of micro-enterprise projects, including helping widows in peanut butter making,
running a tuck shop, rearing and selling broiler chickens and establishing a goat project. We were given a 10 acre plot of
land closer to our projects which, funds permitting, we hope to be able to use to build a medical centre for the local
people as well as a centre to accommodate our teams.
We appointed a Project manager to oversee our expanding work in Uganda and also continued to support work in
Gambia, Ghana, and Zambia.
Page 6
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Sri Lanka
At the beginning of this financial year, everyone involved with the Smile Centre in Sri Lanka was shocked by the sudden
death of its Director, Ronali de Silva, who had played such a key role in helping to develop Smile’s work in Sri Lanka
and managed the programme so well. It is therefore a testament to Ronali’s example and leadership that the work has
continued to thrive. The Centre now cares for 186 children each day, 65 in its pre-school and 121 in after-school care
activities, as well as providing 10 permanent jobs for teachers, administrators and cooks. The Centre was host to our first
corporate team from Coloplast who managed to fit out a new IT suite and repaint the Centre. In order to accommodate
the growing number of children, further classroom blocks were also built in the grounds.
By running specific projects to address particular areas of need
Millennium Development Goals (MDG)
Smile has been actively working to address the eight MDGs agreed at the UN Millennium Summit in New York 2000.
MDG Goal
Smile’s contribution
End poverty and
hunger
Smile is eradicating hunger for over 2,500 children who are helped every day through
our feeding programmes in Zimbabwe, Uganda, India and Sri Lanka.
Universal primary
education
Through our Child sponsorship scheme, Smile is paying school fees so that children in
Zimbawe, Uganda, Zambia, Sri Lanka and India can attend school. In addition we have
provided schools with a range of resources including, books, pens, pencils, craft
materials and IT equipment. Career breakers and Gap Year students have also helped to
support the teaching staff in the schools.
Child healthcare
Through our Child sponsorship scheme, Smile runs health clinics and provides
medicines for children who are sick. We also provide health care and dietary advice to
mothers of slum children.
Combat HIV/AIDS,
malaria and other
diseases
Smile runs HIV/AIDS awareness workshops in Zimbabwe and supports Pastors who are
working at the frontline of the HIV/AIDS pandemic. We have also installed wells and
provided mosquito nets.
Promote gender
equality and
empower women
Smile has trained over 1,000 women in tailoring skills and equipped them with sewing
machines and materials to empower them to earn a living and become self sustaining.
Maternal health
We help to relieve the stress on mothers through our widows’ sponsorship programme
which provides basic material needs as well as providing social opportunities to
maintain emotional and spiritual health. We also run a clinic in India for pre-school
children and their mothers.
Environmental
sustainability
Smile sinks boreholes to provide safe drinking water for remote communities and
improves sanitation facilities in schools. In addition, our aid means that tons of
unwanted tools, clothes, educational and medical resources are put to good use rather
than landfill.
Global partnership
Smile provides IT resources to schools and colleges so they will benefit from improved
global communication. The partnerships created through our school twinning
programmes and visits from the UK foster long term relationships. We also run English
language courses in Kosova which increases employment opportunities and enables
children to make better use of the internet.
Page 7
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Bangalore, India
We continued to run the pre-school which
provided education, food and health care for
65 children in preschool each morning and
approx 35 in after-school care. We employ
10 staff, including a youth and schools
worker. In the afternoons we run a tailoring
course for 30 women and an IT training
course every afternoon, during term-time.
Figure 5 Equipping women with tailoring skills
Breakfast in Bangalore
John and Jacqline live in Jallahalli East, a slum area of Bangalore which is home to a great number of children
living in a similar situation. Their father is very ill and too weak to provide for his family. Their mother scours
the area trying to find washing and ironing work, which provides the meagre income of a few pence to buy food
for the family. John and Jacqline attend the Smile pre-school but they would often fall asleep because of their
hunger and weakness, which made it a struggle to learn their numbers, colours, letters and shapes.
But it is now quite a different story! John and Jacqline run to the preschool where they receive a healthy,
nutritious breakfast at 8am every day. The breakfast, which is given to all the pre-school children at Smile India,
gives them the energy they need to study, learn and develop to their full potential. We are immensely grateful to
those who support our feeding programmes. It costs just £10, the price of a full English Breakfast for two, to
enable Smile to feed 65 such children an Indian breakfast each day.
By working with partners to give practical and healthcare assistance to needy people
Smile’s work relies on strong partnerships with other, like-minded, charities, churches and organisations. Smile has
continued to work with local partners to give practical help to those in need. Smile volunteers have provided activities for
children, including holiday clubs, in schools and churches and in Roma camps in the Balkans and Sri Lanka. We have
provided the use of Smile Centre facilities for conferences and seminars and provided the resources of our Step Out, Gap
Year and Career Break teams. Our teams have also been involved in repairing and re-decorating homes for widows.
Page 8
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
By organising opportunities for Christians to experience mission first hand
Step Out Trips and longer postings
During the year 100 people joined Smile Step Out trips. We ran 12
trips to 4 countries. 25 volunteers undertook longer-term career
breaks or post retirement assignments. Our Taste and See Weekends
became increasingly popular, with 17 people undertaking these. They
undertook a wide range of work from teaching children, managing
the child sponsorship programme, running conferences, overseeing
projects, practical repair work and aid distribution.
Figure 6 Working with children on a Step Out Trip
Gap Years
“I have found this trip to have been one of the
most moving and challenging experiences of my
whole life. I feel it will cause me to re-evaluate
my whole approach to my Christian life.”
Rev Neil Abbott
Figure 7 Some of this year's Gappers during training
We saw a significant increase in new students with 12 going out to Sri Lanka and Uganda. Gappers’ work has
included teaching English, Maths and IT, aid distribution and helping local churches with projects helping
those in need.
By maintaining effective communication with supporters
Smile greatly values the continued commitment and prayers of its supporters. We produced 3 magazines, a
monthly prayer calendar and updated DVDs and PowerPoint presentations and continued to make material
more widely available through the website and YouTube.
Page 9
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
In addition to the many speaking engagements fulfilled by our Regional Coordinators, We undertook 10
speaking and 4 preaching engagements in the UK and visited over 10 schools and youth groups speaking to
nearly 3000 children and young people aged between 3 and 18 about the work of Smile. We were particularly
indebted to Spinnaker for helping us with this and also helping to prepare our Gap Year students with some basic
teaching practice skills.
We invested heavily in a new database system which has transformed our office work, greatly enhanced our
growth capability and improved our capacity for communicating with supporters. We were also able to launch
our new website which will further streamline our work.
We ran a regional road show in Scotland, to meet supporters. We had stands at several exhibitions, including
CRE, Momentum, Soul Survivor, New Wine and Summer Madness. We also responded to several opportunities
to speak on Premier and Kosova Christian radio. Our regional coordinators fulfilled many speaking engagements
on top of the many invitations which came into the office to preach and speak about Smile’s work during the
year in churches, schools and at group meetings.
By recruiting, equipping, training, encouraging, developing and rewarding our staff and volunteers so that all
give of their best.
Staff and volunteers
We keep our staff structure under constant review and, because of pressure on unrestricted funds, had to let our
fund raiser go and leave another post unfilled. We took on a temporary coordinator to oversee our shoebox and
aid operations and are indebted to our many volunteers. Over 100 people regularly help to collect and sort
shoeboxes and aid. Others help to load lorries, man exhibition stands, fill speaking engagements, and help us
with administrative work in the office and with strategic planning and training. We have also had the support of
two young graduate volunteers who have helped to enhance their CVs while at the same time supporting us in a
variety of administrative and practical roles. We ran another training day for our Regional Coordinators and have
attempted to strengthen our volunteer base throughout the UK.
Affiliations
We maintained strategically helpful affiliations which enable us to network and share expertise, including the
Evangelical Alliance, Micah Challenge, Global Connections, VIVA and InterHealth.
Accommodation
As we ended last year we were outbid in negotiations on new premises to incorporate our office and aid storage
and sorting needs under one roof. With the challenging financial situation we reviewed our accommodation and
decided instead to reconfigure our existing office space to make it open plan and more efficient. This has
involved moving our aid work off-site, but we have been fortunate to receive offers first of free shop and then
free warehouse space. This enabled us to take substantially more aid, which otherwise would have overstretched
our capacity.
Risk Assessment
The Trustees acknowledge their responsibility to undertake a risk assessment of the Charity’s work and regularly
review all aspects of Smile’s work. Risk management plans are implemented. The Trustees keep this process
under regular review. The main risks are financial, and in particular:
•
•
•
•
the shortage of unrestricted income to maintain current expenditure and our reserves policy.
the uncertainty of foreign exchange rate fluctuations and global food prices on projects.
fraud, through assets being abused through dishonesty in countries where we operate (e.g. requests for
bribes to release aid).
the incapacity of key personnel.
We regularly monitor and, where necessary, address these risks.
Page 10
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
Reserves policy
The Trustees continue to review the appropriate level of reserves required annually.
The main purpose of our reserves is:
•
•
to meet our statutory and contractual liabilities.
to enable us to react quickly to new challenges when faced with extreme need requiring crisis relief
in times of war, natural disaster, political instability or disease.
In practice this means aiming to have at least 1 month of running costs together with a crisis contingency of
£10,000. Current reserves still fall short of this aspiration. Our management plan seeks to remedy this.
Reserves of the charity fall into two types:
(1) Restricted funds
These are funds where a donor has stipulated how their donation is to be spent. In most cases there will be a time
difference between when such funds are received and when they are spent. In particular, there may be a need for
immediate relief work, followed by longer-term rehabilitation and development projects, resulting in part of the
restricted appeal monies being expended over a number of years. Sometimes it takes time to raise sufficient
funds to be able to start a project so there may also be a delay in making expenditure.
(2) Unrestricted funds
These are funds when there is no stipulation from the donor as to how the donation may be spent. Within certain
operating needs, the trustees’ policy is to ensure that all funds are expended as soon as possible, in order to fulfil
the purpose of the donations, while guaranteeing these resources are used effectively. Not only does this achieve
the goals of the charity to help those in need, but this also means that we can give speedy feedback to donors,
which helps inspire confidence in our work and motivates donors to continue their support.
Future plans
Smile’s Five Year Vision (2009-14): We aim to support 5,000 of the world’s most needy children and families
and to see 500 people join our new Step Out programme every year.
Our main objective for 2011/12 is:
To complete the implementation of the management plan to place Smile on a firmer financial footing by
establishing prudent reserves and taking forward the work as planned. In particular, we aim to:
o
o
o
o
o
Expand our core volunteer base.
Increase our income from trips and sponsorship by broadening our support base.
Plan the development of a Smile complex in Zimbabwe.
Launch our palliative care service in Kosova.
Review our aid programme.
We recognise that we cannot afford to do everything and continue to prioritise expenditure in line with our
objectives. The Trustees would like to express their gratitude to all of our supporters and donors, big or small
and their deep appreciation to all the staff, volunteers, supporters, and partner organisations, for their
commitment and contribution to the vision and values of Smile International. We continue to trust that the Lord
will provide.
Page 11
SMILE INTERNATIONAL
TRUSTEES' REPORT (continued)
FOR THE YEAR ENDED 31 MARCH 2011
TRUSTEES' RESPONSIBILITIES STATEMENT
The Trustees are responsible for preparing the Trustees' report and the financial statements in accordance
with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted
Accounting Practice).
The law applicable to charities in Select jurisdiction requires the Trustees to prepare financial statements for
each financial year which give a true and fair view of the state of affairs of the charity and of the incoming
resources and application of resources of the charity for that period. In preparing these financial statements,
the Trustees are required to:
•
select suitable accounting policies and then apply them consistently;
•
observe the methods and principles in the Charities SORP;
•
make judgments and estimates that are reasonable and prudent;
•
prepare the financial statements on the going concern basis unless it is inappropriate to presume that
the charity will continue in operation.
The Trustees are responsible for keeping accounting records that disclose with reasonable accuracy at any
time the financial position of the charity and enable them to ensure that the financial statements comply with
the Charities Act 1993, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust
deed. 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.
This report was approved by the Trustees on 27 January 2012 and signed on their behalf, by:
Mrs G Alliston
Trustee
Page 12
SMILE INTERNATIONAL
INDEPENDENT AUDITORS' REPORT TO THE TRUSTEES OF SMILE INTERNATIONAL
We have audited the financial statements of Smile International for the year ended 31 March 2011 set out on
pages 15 to 25. The financial reporting framework that has been applied in their preparation is applicable law
and the Financial Reporting Standard for Smaller Entities (effective April 2008) (United Kingdom Generally
Accepted Accounting Practice applicable to Smaller Entities).
This report is made solely to the charity's members, as a body, in accordance with section 43 of the Charities
Act 1993 and regulations made under section 44 of that Act. Our audit work has been undertaken so that we
might state to the charity's members those matters we are required to state to them in an Auditors' 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 its members, as a body, for our audit work, for this report, or for the opinion
we have formed.
RESPECTIVE RESPONSIBILITIES OF TRUSTEES AND AUDITORS
As explained more fully in the Trustees' responsibilities statement, the Trustees are responsible for the
preparation of financial statements which give a true and fair view.
We have been appointed as auditors under section 43 of the Charities Act 1993 and report to you in
accordance with regulations made under section 44 of that Act. Our responsibility is to audit and express an
opinion on the financial statements in accordance with applicable law and International Standards on Auditing
(UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards
for Auditors.
SCOPE OF THE AUDIT OF THE FINANCIAL STATEMENTS
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient
to give reasonable assurance that the financial statements are free from material misstatement, whether
caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to
the charity's circumstances and have been consistently applied and adequately disclosed; the reasonableness
of significant accounting estimates made by the Trustees; and the overall presentation of the financial
statements. In addition, we read all the financial and non-financial information in the Trustees' report to
identify material inconsistencies with the audited financial statements. If we become aware of any apparent
material misstatements or inconsistencies we consider the implications for our report.
OPINION ON FINANCIAL STATEMENTS
In our opinion the financial statements:
•
give a true and fair view of the state of the charity's affairs as at 31 March 2011 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 applicable to Smaller Entities; and
•
have been prepared in accordance with the requirements of the Charities Act 1993.
Page 13
SMILE INTERNATIONAL
INDEPENDENT AUDITORS' REPORT TO THE TRUSTEES OF SMILE INTERNATIONAL
MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
We have nothing to report in respect of the following matters where the Charities Act 1993 requires us to
report to you if, in our opinion:
•
the information given in the Trustees' report is inconsistent in any material respect with the financial
statements; or
•
sufficient 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.
Hedley Dunk Limited
Chartered Accountants
Statutory Auditor
Trinity House
3 Bullace Lane
Dartford
Kent
DA1 1BB
27 January 2012
Hedley Dunk Limited are elegible to act as auditors in terms of section 1212 of the Companies Act 2006.
Page 14
SMILE INTERNATIONAL
STATEMENT OF FINANCIAL ACTIVITIES
(incorporating income and expenditure account)
FOR THE YEAR ENDED 31 MARCH 2011
Note
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
2
3,4
5
6
223,276
-
970,892
998
22
342
1,194,168
998
22
342
1,052,104
839
39
-
223,276
972,254
1,195,530
1,052,982
252,564
-
59,554
932,885
2,522
59,554
1,185,449
2,522
60,142
931,694
2,400
252,564
994,961
1,247,525
994,236
(29,288)
(22,707)
(51,995)
58,746
(19,726)
19,726
(49,014)
(2,981)
(51,995)
58,746
82,747
4,443
87,190
28,444
33,733
1,462
35,195
87,190
INCOMING RESOURCES
Incoming resources from generated funds:
Voluntary income
Activities for generating funds
Investment income
Other incoming resources
TOTAL INCOMING RESOURCES
RESOURCES EXPENDED
Costs of generating funds:
Fundraising expenses and other costs
Charitable activities
Governance costs
4
12
8
TOTAL RESOURCES EXPENDED
11
NET INCOME / (EXPENDITURE)
BEFORE TRANSFERS
Transfers between Funds
NET MOVEMENT IN FUNDS FOR THE
YEAR
Total funds at 1 April 2010
19
-
-
TOTAL FUNDS AT 31 MARCH 2011
The notes on pages 17 to 25 form part of these financial statements.
Page 15
SMILE INTERNATIONAL
BALANCE SHEET
AS AT 31 MARCH 2011
Note
£
2011
£
£
2010
£
FIXED ASSETS
Tangible assets
15
32,784
2,207
CURRENT ASSETS
Stocks
Debtors
4,149
3,186
5,157
25,979
50,138
128,209
59,444
157,374
(32,033)
(57,391)
16
Cash at bank and in hand
CREDITORS: amounts falling due within
one year
17
NET CURRENT ASSETS
27,411
99,983
TOTAL ASSETS LESS CURRENT LIABILITIES
60,195
102,190
(25,000)
(15,000)
35,195
87,190
CREDITORS: amounts falling due after
more than one year
18
NET ASSETS
CHARITY FUNDS
Restricted funds
19
33,733
82,747
Unrestricted funds
19
1,462
4,443
35,195
87,190
TOTAL FUNDS
The financial statements were approved by the Trustees on
27 January 2012 and signed on their behalf, by:
Mrs G Alliston
The notes on pages 17 to 25 form part of these financial statements.
Page 16
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
1.
ACCOUNTING POLICIES
1.1 Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention, with the
exception of investments which are included at market value, and in accordance with the Financial
Reporting Standard for Smaller Entities (effective April 2008). The financial statements have been
prepared in accordance with the Statement of Recommended Practice (SORP), "Accounting and
Reporting by Charities" published in March 2005 and applicable accounting standards.
1.2 Fund accounting
General funds are unrestricted funds which are available for use at the discretion of the Trustees in
furtherance of the general objectives of the charity and which have not been designated for other
purposes.
Designated funds comprise unrestricted funds that have been set aside by the Trustees for
particular purposes. The aim and use of each designated fund is set out in the notes to the financial
statements.
Restricted funds are funds which are to be used in accordance with specific restrictions imposed by
donors which have been raised by the charity for particular purposes. The cost of raising and
administering such funds are charged against the specific fund. The aim and use of each restricted
fund is set out in the notes to the financial statements.
Investment income, gains and losses are allocated to the appropriate fund.
1.3 Incoming resources
All incoming resources are included in the Statement of financial activities when the charity is legally
entitled to the income and the amount can be quantified with reasonable accuracy.
Gifts in kind donated for distribution are included at valuation and recognised as income when they
are distributed to the projects. Gifts donated for resale are included as income when they are sold.
Donated facilities are included at the value to the charity where this can be quantified and a third
party is bearing the cost. No amounts are included in the financial statements for services donated
by volunteers.
Donated services or facilities, which comprise donated services, are included in income at a
valuation which is an estimate of the financial cost borne by the donor where such a cost is
quantifiable and measurable. No income is recognised where there is no financial cost borne by a
third party.
Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is
recognised at the time of the donation.
Income tax recoverable in relation to investment income is recognised at the time the investment
income is receivable.
Page 17
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
1.
ACCOUNTING POLICIES (continued)
1.4 Resources expended
All expenditure is accounted for on an accruals basis and has been included under expense
categories that aggregate all costs for allocation to activities. Where costs cannot be directly
attributed to particular activities they have been allocated on a basis consistent with the use of the
resources.
Fundraising costs are those incurred in seeking voluntary contributions and do not include the costs
of disseminating information in support of the charitable activities. Support costs are those costs
incurred directly in support of expenditure on the objects of the charity and include project
management carried out at Headquarters. Governance costs are those incurred in connection with
administration of the charity and compliance with constitutional and statutory requirements.
1.5 Tangible fixed assets and depreciation
All assets costing more than £1,000 are capitalised.
The policy with respect to impairment reviews of fixed assets is ...
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates
calculated to write off the cost of fixed assets, less their estimated residual value, over their
expected useful lives on the following bases:
Fixtures & fittings
Office equipment
-
25% on a reducing balance basis
25% on a reducing balance basis
1.6 Stocks
Stocks are valued at the lower of cost and net realisable value after making due allowance for
obsolete and slow-moving stocks. Cost includes all direct costs and an appropriate proportion of
fixed and variable overheads.
2.
VOLUNTARY INCOME
Grants and donations
Gifts in kind
Ministry trips,gap year students and career
breaks
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
223,276
-
168,171
666,980
391,447
666,980
426,429
473,232
135,741
135,741
152,443
223,276
970,892
1,194,168
1,052,104
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
998
998
839
-
Voluntary income
3.
FUNDRAISING INCOME
Merchandising
Page 18
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
4.
TRADING ACTIVITIES
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
-
(963)
13,111
47,406
(963)
13,111
47,406
550
6,870
52,722
-
59,554
59,554
60,142
-
(59,554)
(59,554)
(60,142)
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
22
22
39
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
342
342
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
133,662
830,309
963,971
691,182
118,902
102,576
-
102,576
118,902
100,124
140,388
252,564
932,885
1,185,449
931,694
Fundraising trading expenses
Merchandising
Publicity
Direct costs - Fundraising
Net expenditure from trading activities
5.
INVESTMENT INCOME
Restricted
funds
2011
£
Investment income
6.
-
OTHER INCOMING RESOURCES
Restricted
funds
2011
£
Other incoming resources
7.
-
-
EXPENDITURE BY CHARITABLE ACTIVITY
SUMMARY BY FUND TYPE
Aid
Ministry trips, gap year students & career
breaks
Sponsorships
Page 19
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
7.
EXPENDITURE BY CHARITABLE ACTIVITY (continued)
SUMMARY BY EXPENDITURE TYPE
Aid
Ministry trips,gap year
students & career breaks
Sponsorships
Staff costs
2011
£
Depreciation
2011
£
Other costs
2011
£
Total
2011
£
Total
2010
£
137,772
13,793
812,406
963,971
691,182
102,576
118,902
102,576
118,902
100,124
140,388
13,793
1,033,884
1,185,449
931,694
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
2,522
2,522
2,400
-
-
137,772
8.
GOVERNANCE COSTS
Governance Auditors' remuneration
9.
-
DIRECT COSTS
Fundraising
£
Aid
Ministry trips, gap
year & career
breaks
Travel
Wages and
salaries
National
insurance
Ministry trips,
Aid gap year etc Sponsorship
£
£
£
-
680,016
-
6,276
-
99,815
-
Total
2011
£
Total
2010
£
798,918
629,882
-
99,815
6,276
81,831
6,430
118,902
43,269
126,585
-
-
169,854
125,366
4,137
11,187
-
-
15,324
10,407
47,406
824,064
1,090,187
853,916
Page 20
99,815
118,902
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
10.
SUPPORT COSTS
Aid
£
Ministry
trips,gap y
£
Total
2011
£
Total
2010
£
2,154
68,820
3,075
2,727
24,796
7,115
128
5,267
4,006
1,171
21
6,834
13,793
487
2,274
-
2,641
68,820
3,075
2,727
24,796
7,115
128
5,267
6,280
1,171
21
6,834
13,793
556
12,196
2,150
448
33,815
7,361
1,008
4,429
6,278
1,810
6,991
736
139,907
2,761
142,668
77,778
Travel
Rent & rates
Light & heat
Insurance
Printing, postage & stationery
Computer costs
Recruitment costs
Subscriptions & donations
General expenses
Bank charges
Loss/(gain) on foriegn exchange
Telephone
Depreciation
11.
ANALYSIS OF RESOURCES EXPENDED BY EXPENDITURE TYPE
Staff costs
2011
£
Depreciation
2011
£
Other costs
2011
£
Total
2011
£
Total
2010
£
Fundraising expenses
47,406
-
59,554
106,960
60,142
Costs of generating funds
47,406
-
59,554
106,960
60,142
Aid
Ministry trips,gap year
students & career breaks
Sponsorships
137,772
812,406
963,971
691,182
102,576
118,902
102,576
118,902
100,124
140,388
1,033,884
1,185,449
931,694
2,522
2,522
2,400
1,095,960
1,294,931
994,236
13,793
-
-
Charitable activities
137,772
Governance
13,793
-
185,178
-
13,793
Page 21
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
12.
ANALYSIS OF RESOURCES EXPENDED BY ACTIVITIES
Aid
Ministry trips, gap year students & career
breaks
Sponsorships
Total
13.
Activities
undertaken
directly
2011
£
Support
costs
2011
£
Total
2011
£
Total
2010
£
824,064
139,907
963,971
691,182
99,815
118,902
2,761
-
102,576
118,902
100,124
140,388
1,042,781
142,668
1,185,449
931,694
NET INCOME / (EXPENDITURE)
This is stated after charging:
Depreciation of tangible fixed assets:
- owned by the charity
Governance Auditors' remuneration
2011
£
2010
£
13,793
2,522
736
2,400
During the year, no Trustees received any remuneration (2010 - £NIL).
During the year, no Trustees received any benefits in kind (2010 - £NIL).
During the year, no Trustees received any reimbursement of expenses (2010 - £NIL).
14.
STAFF COSTS
Staff costs were as follows:
Wages and salaries
Social security costs
2011
£
2010
£
169,854
15,324
174,047
14,448
185,178
188,495
2011
No.
2010
No.
6
6
The average monthly number of employees during the year was as follows:
Management and administration
No employee received remuneration amounting to more than £60,000 in either year.
Page 22
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
15.
TANGIBLE FIXED ASSETS
Fixtures &
fittings
£
Office
equipment
£
Total
£
At 1 April 2010
Additions
Disposals
5,824
-
14,418
38,545
(14,418)
14,418
44,369
(14,418)
At 31 March 2011
5,824
38,545
44,369
At 1 April 2010
Charge for the year
On disposals
1,457
-
12,211
10,127
(12,210)
12,211
11,584
(12,210)
At 31 March 2011
1,457
10,128
11,585
At 31 March 2011
4,367
28,417
32,784
At 31 March 2010
-
2,207
2,207
Cost
Depreciation
Net book value
Historically the charity has spent funds on the construction of a property in Kosova. The charity owns
the building and is using the property as a centre for the charity's operations in Kosova. The trustees
believe, because of it's location, that the building has no realisable value and as such it is carried in
these financial statements at £nil.
The aggregate amount spent on the property's construction since building commenced amounted to
£249,201 at the balance sheet date (2010 £249,201).
16.
DEBTORS
Trade debtors
Other debtors
Prepayments and accrued income
Page 23
2011
£
2010
£
4,457
700
19,744
5,535
700
5,157
25,979
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
17.
CREDITORS:
Amounts falling due within one year
Other loans
Social security and other taxes
Accruals and deferred income
18.
2011
£
2010
£
20,000
3,640
8,393
20,000
4,142
33,249
32,033
57,391
2011
£
2010
£
25,000
15,000
2011
£
2010
£
25,000
15,000
CREDITORS:
Amounts falling due after more than one year
Other loans
Creditors include amounts not wholly repayable within 5 years as follows:
Repayable other than by instalments
Page 24
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2011
19.
STATEMENT OF FUNDS
Brought
Forward
£
Incoming
resources
£
Resources
Expended
£
Transfers
in/out
£
Carried
Forward
£
4,443
972,254
(994,961)
19,726
1,462
639
24,112
5,573
25,082
1,517
1,350
134
2,698
19,505
2,137
-
19,177
2,221
30,014
2,883
107,211
38,216
12,766
9,473
1,315
(43,289)
(3,528)
(55,096)
(2,303)
(81,463)
(31,420)
(6,020)
(25,012)
(2,111)
(2,322)
(267)
(346)
(12,865)
(4,586)
(1,532)
(1,137)
1,007
639
3,999
1,751
14,233
2,344
7,912
2,829
26
-
82,747
223,276
(252,564)
(19,726)
33,733
87,190
1,195,530
(1,247,525)
Brought
Forward
£
Incoming
resources
£
Resources
Expended
£
Transfers
in/out
£
Carried
Forward
£
4,443
82,747
972,254
223,276
(994,961)
(252,564)
19,726
(19,726)
1,462
33,733
87,190
1,195,530
(1,247,525)
Unrestricted funds
General Funds - all funds
Restricted funds
South America
Kosova & Balkans
Sri Lanka
Zimbabwe
Africa (Rest of)
Child sponsorship
Widow sponsorship
Pastor sponsorship
Gifts with love
Haiti
India
Total of funds
-
35,195
SUMMARY OF FUNDS
General funds
Restricted funds
20.
-
35,195
ANALYSIS OF NET ASSETS BETWEEN FUNDS
Tangible fixed assets
Current assets
Creditors due within one year
Creditors due in more than one year
Restricted
funds
2011
£
Unrestricted
funds
2011
£
Total
funds
2011
£
Total
funds
2010
£
33,733
-
32,783
25,711
(32,032)
(25,000)
32,783
59,444
(32,032)
(25,000)
2,207
157,375
(57,392)
(15,000)
33,733
1,462
35,195
87,190
Page 25