audited accounts - Smile International

Financial Statements for the Year ended 31 March 2010 (Charity Number 1079730)
Celebrating
10 years of Smiles
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
SMILE INTERNATIONAL
FINANCIAL STATEMENTS
Year ended 31 March 2010
CONTENTS
Trustees‟ Annual Report
Independent Auditor‟s Report
Statement of Financial Activities
Balance Sheet
Notes to the financial statements
PAGES
3-14
15-16
17
18
19-26
The trustees present their report and the financial statements of the charity for the year ended 31
March 2010.
REFERENCE AND ADMINISTRATIVE DETAILS
Smile International
1079730
Registered charity name
Charity registration number
THE TRUSTEES & OTHER ADVISORS
The trustees who served the charity during the
period were:
Mrs Geraldine Alliston
Mr Roger Brown
Mr Graham Garner
The Council of Reference serving during the
year were:
Rev Canon Michael Adams
Rev Dr Theodore Angelov
Rev Dr David Coffey
Rev Dr David Russell
Professor Brian Stanley
Auditor
Bankers
Hedley Dunk Limited
Chartered Accountants
Trinity House
3 Bullace Lane
Dartford
Kent, DA1 1BB
HSBC
9 Station Square
Petts Wood
Orpington
Kent
BR5 1LR
2
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
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.
"CELEBRATING 10 YEARS OF SMILES"
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. We are presently working in Africa, Asia and Europe.
The Trustees have ensured that Smile remains committed to the long-term rebuilding of lives by
sharing, in practical ways, God‟s unconditional love for a needy world.
Like most charities, we faced the year wondering whether our income levels would hold and how the
impact of weakening sterling would affect our overseas projects. The strategic review we undertook in
2009 has served us well, enabling us to focus on consolidating existing projects, streamline our
fundraising and simplify our funds.
Smile‟s work depends 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. As we
celebrate our 10th year as a registered charity we can thank God for what He has enabled us to achieve
during our first decade:
 £7million raised
 100,000 shoeboxes sent out to needy children
 2,000 children fed every day
 1,000 people stepping out of their comfort zone
We are so grateful to God
 480 children sponsored each year
for the amazing way He
 84 widows supported each year
has blessed the work of
 50 young people using their Gap Year to make a real
Smile over the past
difference
 Smile Centres established on 3 Continents
decade! The growth and
development of the
Particularly pleasing this year has been our ability to transfer the
ministry is varied, exciting
running and management of Smile Kosova to a team of locally
and wonderful to witness.
employed staff, bringing Kosova in line with our operations in
We look forward, with
other countries and also the continued growth of our Gifts with
God’s guidance, to
Love and sponsorship programmes.
helping more people in
need around the world
OUR AIMS
over the next decade.
 To transform whole lives – body and soul – of the most
Rev Clive Doubleday,
vulnerable people who have been damaged by war,
CEO
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
3
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
OUR APPROACH
Smile‟s work is encapsulated by our strap-line: PRAY – GIVE – GO
PRAY
GIVE
GO
We are a faith-driven organisation dependent on continuing prayer
support
We depend on your generosity (individuals, churches and organizations)
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
ACTIVITIES
Running sponsorship schemes and raising funds for projects and general work
The Trustees and management team continued to implement the action plan to reduce costs; to step up
publicity in order to widen the supporter base and generate more income, as well as to refocus Smile‟s
activities in order to concentrate on more sustainable activities. This, coupled with the appointment of
a Fundraising Manager is helping to establish Smile on a firmer financial footing as it enters its
second decade as a registered charity. Fundraising is now targeted at developing our broad range of
work in each territory, rather than on smaller initiatives, and allows our managers and partners on the
ground to prioritise activities based on their listening to local needs in line with achieving the agreed
objectives.
Income
Income £
Overall income levels were £1,052,982 in 2009/10,
an increase of 25%. Cash income grew by 4%, with
Gifts in Kind increasing by 67%. Our sponsorship
Restricted
(children, widows and pastors) programme has
£245,045
Gifts in
continued to grow with sponsored income up 10%.
23%
kind
Unrestricted donations and Trip income remained
£473,232
45%
Unfairly flat as the recession caused would-be trippers
restricted
to opt for shorter “Taste and See” weekends.
£334,707
32%
Expenditure
Cash expenditure rises were kept below our growth
in income (4% compared to 25%) reflecting the
ongoing streamlining of activities, holding pay roll
costs and fewer overseas trips, although the costs of
overseas programmes increased as a result of the
weakened £. Our aim is to transfer funds to overseas
projects as quickly as possible but some new projects
will require us to accumulate funds before they can
be started. We endeavoured to keep administration
costs to a minimum and currently 94% of our
expenditure is linked to projects. It is inevitable
though, that some investment in capacity building
has been necessary in order to provide the platform
for growth.
4
Expenditure £
Fund
generation
£59,592
6%
Charitable
activities
£932,245
94%
Governance
£2,400
0%
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
SPONSORSHIP PROGRAMMES
Child sponsorship (up 5%) Our Child Sponsorship programme has seen further growth and, by the
end of the year we had 480 sponsored children supported by 427 sponsors. We have deliberately
focused the growth this year in India, Sri Lanka and Zimbabwe, where the needs were greatest, and
decided not to replace children who have left the programme in other countries. Nevertheless we
continue to support more children than are sponsored.
Number sponsored
Zimbabwe
Uganda
Sri Lanka
Zambia
India
Kosova
2008/9
75
250
95
10
26
2009/10
84
230
126
7
32
1
Widow sponsorship
We maintained a scheme to help widows with
basic essentials like flour, oil, detergents and
wood for cooking and heating as well as
fellowship. Though overall numbers remained
about the same, we undertook a thorough means
tested review to ensure that those supported in
Kosova were still in need. We found that the
economic situation of some 12 widows had
improved to the extent that we were able to
transfer the support to widows with greater
need.
Number sponsored
Kosova
Uganda
Sri Lanka
Zimbabwe
2008/9
32
13
28
11
2009/10
32
12
27
13
Pastor sponsorship
We began a programme of support for needy
Pastors who were supporting congregations who
were 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.
Number sponsored
India
Sri Lanka
Zimbabwe
2009/10
3
4
8
Figure 1: Smile Director giving aid to a needy Pastor and his
wife in Zimbabwe
5
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
SUSTAINABLE PROJECTS AND EMERGENCY AID
By collecting and distributing aid
We sent three 20ft sea containers to Gambia, Zimbabwe and Haiti, (a fourth arrived in Sri Lanka), two
40ft lorry loads to Kosova and Romania and 4 pallets on a shared shipment to Macedonia.
Donations of aid (gifts in kind) were £473k. We received some particularly generous donations
including memory chips from Coloplast for upgrading computers in Sri Lanka (value £1,000); Russell
and Bromley shoes (value £3,000); a 4x4 for our work in Kosova (value £7,000); recycled boxes from
Arco (value £6,000); discounted storage from Access Storage (value £4,000); Prima Tape and Labels
(value £1,000); Kangol caps (value £45,800), and mini fridges from Britvic (value £2,500). We were
grateful for the generous use of facilities at Christ Church, Chislehurst for shoebox checking and
packing. Our knitters continued to be productive and we have been able to distribute hundreds of
boxes of knitted clothes, blankets and toys.
Our more selective approach to aid has been effective and we were able to respond to requests for
emergency relief for the Haiti Earthquake in partnership with Bromley based Haiti Hospital Appeal.
Shoeboxes and Harvest appeal
With the help of over 100
volunteers we collected and sorted
over 12,360 shoeboxes. We
received just over £5.5k under the
Sponsor a Shoebox scheme with
which we purchased culturally
relevant gifts in the destination
countries. In addition we were
able to dispatch 961 school or
craft packs.
Figure 2: Children with their new pens
and pencils in Uganda
6
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
By establishing Smile Centres in key locations as self-supporting centres to provide a base, 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 Step Out
Trips, Career Breaks and Gap Year students and was used
increasingly by other Christian organisations for conferences and by
Pastors and other Christians for retreats. We were particularly
please to be able to host, for the first time, the annual conference of
AIM (Association of International Missionaries) a fulfilment of part
of the vision for which the centre was first built. We have also held
regular widows‟ days, worship seminars, IT training, agriculture
training for widows, women‟s and youth conferences and hosted
Girls‟ Brigade trips.
Figure 3: Astrit Morina Kosova Country Director
Figure 4: Klodiana and Shkelzen Halilaj
- Centre Managers
...confident
enough to bring
Kosova into line
with our worldwide
strategy of
employing national
Christians to run
our Centres
Figure 5: Albert (Berti) Frroku Project Coordinator
With the improving political situation in Kosova we felt confident enough to bring Kosova into line
with our worldwide strategy of employing national Christians to run our Centres. At the beginning of
January 2010 we appointed Pastor Astrit Morina as Country Director to oversee Smile‟s work in
Kosova. We were also able to announce the appointment of Shkelzen and Klodiana Halilaj as our
Centre Managers, and also the appointment of Albert (Berti) Frroku as Project Coordinator. We are
indebted to all those who have helped to care for and promote the Centre since it was built..
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 four schools. Our team has worked under difficult conditions contending with
power and water cuts, and shortages of food supplies and other basic necessities which continue to
undermine the well-being and health of the population.
7
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
We continued the twinning
programme between several UK
schools and schools in Zimbabwe in
order to foster cross-cultural
education. We continued HIV/AIDS
awareness seminars, adult literacy
groups in Molife and Mukombami
villages, and a micro-enterprise
project in St Jude‟s, Fungai for 30
women who meet every week to
make school uniforms and clothes in
order to earn money so their
children can go to school.
Figure 6: Maternity packs to hospital in Gambia
We have also supported work in Gambia, Ghana, Uganda, and Zambia.
Sri Lanka
The Smile Centre now cares for 185 children each day
(a 13% increase), 54 in its pre-school and 131 in after
school care activities. The Centre provides 11
permanent jobs for teachers, administrators and cooks.
Their work has been eased by the acquisition of a new
Smile Tuktuk. A sea container of aid, including
computers, sewing machines, school packs, craft items,
clothes and shoeboxes of toys were distributed to help
the widows, children and other poor people, including
the families of prisoners. We continued to provide
Figure 7: The new Smile Tuktuk
equipment to help with skills training/job creation, and
education for the children. We also helped to repair
houses and provided the annual school fees for 18 prisoners‟ children, at Tangalle. Smile also
provided books for the library, and sewing machines and beds for the hospital at Wirawila Open
Prison. .
We began our first corporate sponsorship with Coloplast for our work in Sri Lanka. They held several
fundraising events and agreed to fund a team to go out in 2010 to help to equip and set up an IT suite
at the Centre. Work is already progressing to repair the roof, which had been stripped by monkeys!
By running specific projects to address particular areas of need
Teaching, Kosova
Our Gap Year students continued to teach English as a foreign language to 20 students in Gjakova and
surrounding villages as well as visiting local schools, helping to distribute aid and shoeboxes at
Christmas, helping to run the GB group and generally supporting local churches.
Medical facilities Kosova
We continued to investigate the feasibility of providing a Palliative Care facility and held meetings
with local doctors and senior Government officials to ensure that such a project would get official
support. After extensive fund raising, we have now begun recruitment.
8
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
Feeding station, Uganda
We continued to send out Step Out teams to work with the Stephen Jota Centre in Uganda helping to
feed and teach 500 children, including those sponsored under our Child Sponsorship programme. We
sent out a team of 15 people for a month last summer led by Rev Steve and Jan Worthy
Bangalore, India
We continued to run the pre-school which provided education, food and health care for 65 children in
preschool in morning and approx 35 in after-school care. We also gave computers to local schools,
churches and pastors. We established a tailoring project to help poor women to learn a skill and
provide for their families. This is going very well with 20 women participating so far. In addition,
Smile India has provided training for 15 trainee pastors and ran health clinics from the pre-school for
the children and their mothers.
Figure 8: Women engaged in the tailoring project in
Bangalore
Figure 9: Pastors at their recent graduation service
By working with partners to give practical and healthcare assistance to needy people
Smile‟s work relies on strong partnerships with other, likeminded, charities, churches and organisations. Smile has
continued to work with local partners (schools, churches and
other charities) to give practical help to those in need. Smile
volunteers have worked with schools and churches in the
Balkans and Sri Lanka and in Roma camps to provide activities
for children including holiday clubs. 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 been involved in repairing and redecorating homes for widows.
Figure 10: Decorating a widow's home in
Kosova
9
SMILE INTERNATIONAL
TRUSTEES’ ANNUAL REPORT (continued)
Year ended 31 March 2010
New roof for Nilanthi
Nilanthi and her children live in
Hambantota and their old palm branch roof
used to leak terribly, particularly during the
monsoon, leaving their house damp, cold
and wet. Smile has replaced the palm
branches with metal corrugated sheets and
this makes the house waterproof and dry.
Nilanthi and her family say a very big
„Thank you‟ to Smile and its supporters for
their new roof. We thank the Lord for His
faithfulness in caring for those in need
through those who are obedient to His call
for their involvement in His work.
Figure 11: Nilanthi with her new roof in Sri Lanka
By organising opportunities for Christians to experience mission first hand
Step Out Trips and longer postings
During the year 128 people joined Smile Step Out trips.
We ran 19 trips to 6 countries. 3 volunteers went out on
longer-term career breaks or post retirement
assignments. Our new Taste and See Weekends proved
very popular with 19 people undertaking these. They
undertook a wide range of work from teaching and
work with children, administrating the child
sponsorship programme, running conferences,
overseeing projects, practical repair work and aid
distribution.
Figure 12: Trippers helping children have fun in
Uganda
Figure 13: Gapper, Amy, with children at the Smile
Centre, Sri Lanka.
2 students finished their Gap Year in Kosova
during the year and we sent out 3 new students
– 1 with a young Career Breaker to Kosova
and 2 to Sri Lanka. Gappers‟ work has
included teaching English, Maths and IT, aid
distribution and helping local churches. We
hope to see numbers increase again as the
economic climate improves.
10
By maintaining effective communication with supporters
Smile greatly values the continued commitment and prayers of its supporters. We produced 3
magazines, monthly prayer calendar and updated DVDs and PowerPoints, and continued to make
material more widely available through the website and on YouTube.
We sadly lost our Schools and Gap Year Coordinator during the year and were immensely grateful
to Spinnaker who helped us to visit over 8 schools and youth groups enabling us to speak to nearly
2000 children and young people aged between 3 and 18 about the work of Smile. This was a
substantial increase on previous years.
Progress with our supporter relationship management system has been slower than hoped, with the
system struggling to cope with the wide range of services and activities we cover. This has therefore
delayed the launch of the new website, for which all the design work has been completed. This is
now being given urgent attention.
We ran a regional road show in Scotland, to meet supporters. We had stands at several exhibitions,
including CRE, Soul Survivor, the Churches Big Day Out, Momentum, Soul Survivor Week and
New Wine. 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 12 invitations to
preach and 17 invitations which came into the office to speak about Smile‟s work during the year in
churches, schools and at group meetings. We were particularly grateful to those volunteers who
stepped in to fill the breach during Clive‟s illness.
By recruiting, equipping, training, encouraging, developing and rewarding our staff and
volunteers so that all give of their best.
We have continued to build capability into our operations.
Staff and volunteers
We keep our staff structure under constant review. This year we
again took on a temporary coordinator to oversee our shoebox
operations. We also recruited a part-time fund raiser who has been
developing our fund raising strategy.
We are indebted to our many volunteers. Over 100 people
regularly help to collect and sort shoeboxes and aid. Others help to
load lorries, collect aid, man exhibition stands and fill speaking
engagements. We also have a regular team of experienced
administrative volunteers who have helped us in the office and
with strategic planning and training.
We recognised that we need to invest more into training and
communicating with volunteers in order to achieve our strategic
priorities. We therefore introduced a training day for our Regional
Coordinators and now issue special updates for them. We have started to implement an action plan
to build up their numbers.
Figure 14: John and Angela, two of
our faithful aid room volunteers
Training and process review
During the year we focussed our staff training on realigning work to meet our new strategic
priorities and familiarisation with the new database and telephone system. Individual staff also
received job specific training on things like Sage and fundraising techniques.
Affiliations
We maintained strategically helpful affiliations which enable us to network and share expertise,
11
including the Evangelical Alliance, Micah Challenge, Global Connections, VIVA and Interhealth.
Accommodation
After years of struggling to work with our existing accommodation and having to devote
considerable time trying to find temporary solutions for shoebox sorting each year, we began
negotiations on new premises to incorporate our office and aid storage and sorting needs under one
roof. These were ongoing at the end of the financial year.
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 income to maintain current expenditure and our reserves policy.
the uncertainty of the impact of foreign exchange rate fluctuations on overseas 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.
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 have strengthened during the year but 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 a 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.
12
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 2010/11 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
o
Increase our income from trips and sponsorship activity by broadening our support
base.
Develop more sustainable services for the local people at the Smile Centre, Kosova.
Undertake studies into the feasibility of running Smile orphanages in Zimbabwe
and India.
Recruit our palliative care team in Kosova
Launch the new website.
Complete negotiations on new office and warehouse accommodation
We recognise that we cannot afford to do everything and continue to prioritise expenditure in line
with our objectives. We remain ever grateful to all of our supporters and donors, big or small, and
continue to trust that the Lord will provide.
The Trustees would like to express 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.
13
RESPONSIBILITIES OF THE TRUSTEES
Law applicable to charities in England and Wales requires the Trustees to prepare financial statements
for each financial year. Under that law the trustees have elected to prepare the financial statements in
accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom
Accounting Standards and applicable law). The financial statements are required by law to give a true
and fair view of the state of affairs of the charity and of the surplus or deficit 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;
make judgements 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 proper accounting records which disclose with reasonable
accuracy at any time the financial position of the charity and which enable them to ensure that the
financial statements comply with the Charities Act 1993. The trustees 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.
AUDITOR
A resolution to re-appoint Hedley Dunk Limited as auditor for the ensuing year will be proposed at the
Annual General Meeting.
Signed on behalf of the board
Mrs G Alliston (Trustee)
20 May 2010
14
SMILE INTERNATIONAL
INDEPENDENT AUDITOR'S REPORT TO THE TRUSTEES OF SMILE
INTERNATIONAL
Year ended 31 March 2010
We have audited the financial statements of Smile International for the year ended 31 March 2010
on pages 17 to 26 which have been prepared under the historical cost convention and the accounting
policies set out on page 19
This report is made solely to the charity's trustees, as a body, in accordance with section 44 of the
Charities Act 1993. Our audit work has been undertaken so that we might state to the charity's
trustees 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 trustees as a body, for our audit work, for this report, or for
the opinions we have formed.
RESPECTIVE RESPONSIBILITIES OF THE TRUSTEES AND AUDITOR
The responsibilities of the trustees for preparing the Trustees Annual Report and the financial
statements in accordance with applicable law and United Kingdom Accounting Standards are set out
in the Statement of Responsibilities of the Trustees on pages 13-14
We report to you our opinion as to whether the financial statements give a true and fair view and are
properly prepared in accordance with the Charities Act 1993, and whether the information given in
the Trustees Annual Report is consistent with the financial statements.
In addition we report to you if, in our opinion, the charity has not kept proper accounting records, or
if we have not received all the information and explanations we require for our audit.
We read the Trustees Annual Report and consider the implications for our report if we become
aware of any apparent misstatements within it.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland)
issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence
relevant to the amounts and disclosures in the financial statements. It also includes an assessment of
the significant estimates and judgements made by the trustees in the preparation of the financial
statements, and of whether the accounting policies are appropriate to the charity's circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we
considered necessary in order to provide us with sufficient evidence to give reasonable assurance
that the financial statements are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall adequacy of the
presentation of information in the financial statements.
15
SMILE INTERNATIONAL
INDEPENDENT AUDITOR'S REPORT TO THE TRUSTEES OF SMILE
INTERNATIONAL
Year ended 31 March 2010
OPINION
In our opinion the financial statements:

give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting
Practice, of the state of the charity's affairs as at 31 March 2010 and of its incoming resources
and application of resources, including its income and expenditure, for the year then ended;
and

have been properly prepared in accordance with the Charities Act 1993.
Trinity House
3 Bullace Lane
Dartford
Kent
DA1 1BB
HEDLEY DUNK LIMITED
Statutory Auditor
Chartered Accountants
20 May 2010
16
SMILE INTERNATIONAL
STATEMENT OF FINANCIAL ACTIVITIES
Year ended 31 March 2010
Unrestricted
Funds
Restricted
Funds
Total Funds
2010
Total Funds
2009
Note
£
£
2
807,059
245,045
1,052,104
833,741
3
839
39
-
-
839
39
-
2,886
242
5,267
----------------------------------------------
£
£
INCOMING RESOURCES
Incoming resources from
generating funds:
Voluntary income
Activities for generating
funds
Investment income
Other incoming resources
TOTAL INCOMING RESOURCES
4
5
19/20
-------------------------------------------
--------------------------------------------
-------------------------------------------------------
807,937
245,045
1,052,982
842,136
--------------------------------------------
--------------------------------------------
-------------------------------------------------------
----------------------------------------------
RESOURCES EXPENDED
Costs of generating funds:
Costs of generating
voluntary income
6
Fundraising trading: cost
of goods sold and other
costs
7
Charitable activities
8/9
Governance costs
10
(550)
(696,679)
(2,400)
-----------------------------------------------
-----------------------------------------------
----------------------------------------------
-------------------------------------------------
19/20
(759,221)
(235,015)
(994,236)
(855,315)
-----------------------------------------------
------------------------------------------------
----------------------------------------------
----------------------------------------------
TOTAL RESOURCES EXPENDED
(59,592)
(235,015)
(59,592)
(55,197)
(550)
(931,964)
(2,400)
(708)
(797,110)
(2,300)
NET (OUTGOING)/
INCOMING RESOURCES
BEFORE TRANSFERS
11
48,716
10,030
58,746
(13,179)
Transfer between funds
12
(44,273)
44,273
-
–
---------------------------------------
-------------------------------------
--------------------------------------
-------------------------------------
4,443
54,303
58,746
(13,179)
NET (OUTGOING)/INCOMING
RESOURCES FOR THE YEAR
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD
-
28,444
28,444
41,623
-------------------------------
--------------------------------------
---------------------------------------
---------------------------------------
82,747
87,190
28,444
===============================
===============================
==============================
4,443
===========================
The Statement of Financial Activities includes all gains and losses in the year and therefore
a statement of total recognised gains and losses has not been prepared.
All of the above amounts relate to continuing activities.
17
SMILE INTERNATIONAL
BALANCE SHEET
31 March 2010
2010
Note
£
2009
£
£
£
FIXED ASSETS
Tangible assets
2,208
14
2,944
CURRENT ASSETS
Stocks
15
3,186
3,395
Debtors
16
25,979
45,183
Cash at bank and in hand
CREDITORS: Amounts falling due
within one year
17
NET CURRENT ASSETS
128,209
38,375
------------------------------------------
---------------------------------------
157,374
86,953
(57,392)
(51,453)
---------------------------------------
---------------------------------------
99,982
35,500
--------------------------------------------
---------------------------------------
TOTAL ASSETS LESS CURRENT LIABILITIES
102,190
38,444
CREDITORS: Amounts falling due
after more than one year
(15,000)
(10,000)
---------------------------------------
--------------------------------------
18
NET ASSETS
87,190
28,444
============================================
=========================================
FUNDS
Restricted income funds
19
82,747
28,444
Unrestricted income funds
20
4,443
-
--------------------------------------
---------------------------------------
TOTAL FUNDS
87,190
28,444
==========================================
==========================================
These financial statements were approved by the Trustees on the 20 May 2010 and are signed on
their behalf by:
MRS G ALLISTON
Trustee
20 May 2010
18
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS
Year ended 31 March 2010
1.
ACCOUNTING POLICIES
Basis of accounting: The financial statements have been prepared under the historical cost convention
and in accordance with applicable United Kingdom accounting standards, the Statement of
Recommended Practice "Accounting and Reporting by Charities" issued in March 2005 (SORP 2005) and
the Charities Act 1993.
Fund accounting:
Unrestricted funds are available for use at the discretion of the trustees in furtherance of the general
objectives of the charity.
Restricted funds are subjected to the restrictions on their expenditure imposed by the donor or through
the terms of an appeal.
Incoming resources: All incoming resources are included in the statement of financial activities when
the charity is entitled to the income and the amount can be quantified with reasonable accuracy. The
following specific policies are applied to particular categories of income:
- voluntary income is received by way of donations and is included in full in the statement of financial
activities when receivable
-
investment income is included when receivable
-
gifts in kind received are included in income when we have identified an economic use for the items
received and have dispatched them.
Resources expended:
Expenditure is recognised on an accruals basis as a liability is incurred.
Expenditure includes VAT which cannot be recovered, and is reported as part of the expenditure to which
it relates:
- charitable expenditure comprises those costs incurred by the charity in the delivery of its activities
and services for its beneficiaries. It includes both costs that can be allocated directly to such activities
and those costs of an indirect nature necessary to support them.
-
governance costs include those costs associated with meeting the constitutional and statutory
requirements of the charity and include the audit fees and costs linked to the strategic management
of the charity.
-
all costs are allocated between the expenditure categories of the statement of financial activities on
a basis designated to reflect the use of the resource. Costs relating to a particular activity are
allocated directly, others are apportioned on an appropriate basis such as floor areas, per capita or
estimated usage.
Fixed assets:
All fixed assets are initially recorded at cost.
Depreciation: Depreciation is calculated so as to write off the cost of an asset, less its estimated residual
value, over the useful economic life on the reducing balance basis at 25% per annum
Stocks: Stocks are valued at the lower of cost and net realisable value, after making due allowance for
obsolete and slow moving items.
Gifts in kind: Gifts in kind are included in the Statement of Financial Activities at the Trustees reasonable
estimate of their gross value to the charity and, when received and distributed, shown as income under
donations (note 2) and included in charitable expenditure (notes 8/9). Where the gift in kind is applied as
aid to a charitable cause covered by a restricted fund, the restricted fund is treated as having purchased it
from the general fund.
19
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
2.
VOLUNTARY INCOME
Unrestricted
Funds
Restricted Total Funds
Funds
2010
Total Funds
2009
£
£
£
£
Grants and donations
181,384
127,877
309,261
270,196
Gifts in kind
473,232
473,232
283,433
Ministry trips, gap year students and
career breaks
152,443
152,443
169,826
Donations
Sponsorships
3.
-
117,168
117,168
110,286
----------------------------------------------
-------------------------------------------
--------------------------------------------------------
----------------------------------------------
807,059
245,045
1,052,104
833,741
========================================
=======================================
==================================================
==========================================
2010
2009
INCOMING RESOURCES FROM ACTIVITIES FOR GENERATING FUNDS
£
Merchandising
4.
£
839
2,886
===================
===========================
2010
2009
INVESTMENT INCOME
£
Bank interest receivable
5.
£
39
242
===========
===========
2010
2009
OTHER INCOMING RESOURCES
£
Exhibitions and publicity
6.
-
5,267
==================
==========================
2010
2009
COSTS OF GENERATING VOLUNTARY INCOME
Costs of generating income
7.
£
£
£
59,592
55,197
=================================
================================
2010
2009
FUNDRAISING TRADING: COST OF GOODS SOLD AND OTHER COSTS
Fundraising trading
£
£
550
708
===================
===================
20
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
8.
COSTS OF CHARITABLE ACTIVITIES BY FUND TYPE
Unrestricted
Funds
Total Funds
2009
£
£
£
£
572,783
75,228
648,011
500,468
81,831
-
81,831
101,735
Sponsorships
-
130,382
130,382
112,948
Support costs
42,065
29,405
71,470
81,959
--------------------------------------------
---------------------------------------------
----------------------------------------------
----------------------------------------------
696,679
235,015
931,964
797,110
========================================
========================================
========================================
=======================================
Support Total Funds
costs
2010
Total Funds
2009
Aid
Ministry trips, gap year students and
career breaks
9.
Restricted Total Funds
Funds
2010
COSTS OF CHARITABLE ACTIVITIES BY ACTIVITY TYPE
Activities
undertaken
directly
Aid
Ministry trips, gap year students and
career breaks
Sponsorships
£
£
£
£
648,011
43,171
691,182
552,646
81,831
18,293
100,124
122,114
130,382
10,006
140,388
122,350
---------------------------------------------
--------------------------------------
----------------------------------------------
----------------------------------------------
860,224
71,470
931,964
797,110
========================================
=================================
========================================
=========================================
2010
2009
10. GOVERNANCE COSTS
£
Audit fees
11. NET (OUTGOING)/INCOMING RESOURCES FOR THE YEAR
This is stated after charging:
Depreciation
Auditor’s remuneration – audit fees
£
2,400
2,300
============================
===========================
2010
2009
£
£
736
981
2,400
2,300
===========================
==========================
21
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
12. FUND TRANSFERS
The Trustees have transferred funds from the General Fund to cover expenditure incurred for
restricted purposes.
13. STAFF COSTS AND EMOLUMENTS
2010
Total staff costs were as follows:
2009
£
£
Wages and salaries
174,047
166,564
Social security costs
14,448
15,567
----------------------------------------------
----------------------------------------------
188,495
182,131
========================================
=======================================
No remuneration was paid to any of the trustees. No trustees paid out expenses (2009 no
trustee paid out expenses on behalf of the charity).
Particulars of employees: The average number of employees during the year, calculated on the
basis of full-time equivalents, was as follows:
Number of management staff
2010
2009
6
6
========
=========
No employee received emoluments of more than £60,000 during the year (2009 - Nil).
22
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
14. TANGIBLE FIXED ASSETS
Freehold
property
COST OR VALUATION
£
Equipment
Total
£
£
At start of the year
–
14,418
14,418
Additions
–
–
–
Revaluation
–
–
–
-------------------------------
-------------------------------
-------------------------------
–
14,418
14,418
======================
===============================
===============================
At start of the year
–
11,474
11,474
Charge for the year
–
736
736
---------------
---------------------------------------
---------------------------------------
–
12,210
12,210
===========
=================================
================================
–
2,208
2,208
===========
=============================
==========================
–
2,944
2,944
===========
===========================
=========================
At end of the year
DEPRECIATION
At end of the year
NET BOOK VALUE
At 31 March 2009
At 31 March 2008
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 (2009 £249,201).
15. STOCKS
2010
£
Stock
2009
£
3,186
3,395
===================
===================
23
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
16. DEBTORS
Trade debtors
Income tax recoverable
Prepayments
17. CREDITORS: Amounts falling due within one year
2010
2009
£
£
19,744
20,100
5,535
24,383
700
700
----------------------------------------------
----------------------------------------------
25,979
45,183
=================================
=================================
2010
2009
£
£
Accruals
9,650
9,040
Tax and NI
4,142
7,449
Deferred Income
23,600
20,964
Loans due within one year
20,000
14,000
--------------------------------------
--------------------------------------
57,392
51,453
============================================
=======================================
2010
2009
18. CREDITORS: Amounts falling after more than one year
Other long term loans
£
£
15,000
10,000
========================================
=======================================
24
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
19. RESTRICTED INCOME FUNDS
Balance at
1 Apr 2009
£
South America
Incoming
resources
£
Outgoing
resources
£
Transfers
£
Balance at
31 Mar 2010
£
-
726
(87)
-
639
(30,448)
46,762
(35,148)
42,946
24,112
176
9,285
(3,888)
-
5,573
-
382
(382)
-
-
23,468
30,557
(28,943)
-
25,082
2,581
10,188
(11,252)
-
1,517
Child
Sponsorship
24,184
100,275
(123,109)
-
1,350
Widow
Sponsorship
521
16,892
(17,279)
-
134
Pastor
Sponsorship
-
4,556
(1,858)
-
2,698
(1,315)
1,762
(211)
-
236
902
3,125
(3,694)
-
333
- child’s play
4,438
4,010
(481)
-
7,967
- with legs
1,470
2,873
(356)
-
3,987
(2,315)
1,635
(647)
1,327
-
4,782
9,021
(6,821)
-
6,982
Haiti
-
2,996
(859)
-
2,137
Total
28,444
245,045
(235,015)
44,273
82,747
Kosova & Balkans
Sri Lanka
India
Zimbabwe
Africa (rest of)
Gifts with love
- emergency
- keep fit
- work it
- other
The Trustees are of the opinion that the activity of aid and shoebox transportation is a core activity
for the charity and as such have combined the funds with the general unrestricted fund. Funds
received for shoeboxes are included with other Gifts with love.
20.
UNRESTRICTED INCOME FUNDS
Balance at
1 Apr 2009
£
General Funds
Incoming
resources
Outgoing
resources
Transfers
£
£
£
-
807,937
(759,221)
(44,273)
================
==========================================
===========================================
========================================
Balance at
31 Mar 2010
£
4,443
==========================
25
SMILE INTERNATIONAL
NOTES TO THE FINANCIAL STATEMENTS (continued)
Year ended 31 March 2010
21. ANALYSIS OF NET ASSETS BETWEEN FUNDS
At 31 March 2010
Tangible
fixed assets
£
Restricted Income Funds
Unrestricted Income Funds
Total Funds at 31 March 2010
Net current
assets
£
Long term
liabilities
£
Total
£
-
82,747
-
82,747
2,208
17,235
(15,000)
4,443
--------------------------------
---------------------------------------------
---------------------------------------------
--------------------------------------
2,208
99,982
===========================
========================================
–
2,944
(15,000)
87,190
===========================================
=====================================
38,444
(10,000)
28,444
(2,944)
–
-
---------------------------------------------
-------------------------------------
At 31 March 2009
Restricted Income Funds
Unrestricted Income Funds
Total Funds at 31 March 2009
---------------------------------
--------------------------------------
2,944
35,500
===========================
===============================
(10,000)
=====================================
28,444
===============================
26