NOTES TO THE FINANCIAL STATEMENTS
1. Principal Accounting Policies
Legal Status
The association is registered under the Co-operative and
Community Benefit Societies Act 2014 and is a registered
housing provider.
Basis of Accounting
The financial statements have been prepared in accordance
with applicable UK Generally Accepted Accounting Practice
(UK GAAP), including Financial Reporting Standard 102
(FRS 102) and the Housing SORP 2014: Statement of
Recommended Practice for Registered Social Housing
Providers and comply with the Accounting Direction for
Private Registered Providers of Social Housing 2015.
Merger Accounting
On 31 March 2017 the operating subsidiaries of Accord
Housing Association fully amalgamated operations with
Accord Housing Association Limited either by means
of a Transfer of Engagements or a Transfer of Business.
These transfers have been incorporated in the year ended
31 March 2017 financial statements of Accord Housing
Association Limited using merger accounting. Accord Group
Treasury Limited was not included in this simplification
exercise and remains a subsidiary of Accord Housing
Association Limited.
Merger accounting has been adopted to capture the
transfer of the assets and liabilities of each of the entities
transferring into Accord Housing Association Limited.
Further details are set out in note 33.
Public Benefit Entity
The association is a Public Benefit Entity, as defined within
FRS 102 as “an entity whose primary objective is to provide
goods or services for the general public, community or
social benefit and where any equity is provided with a
view to supporting the entity’s primary objectives rather
than with a view to providing a financial return to equity
providers, shareholders or members.
Going Concern
The association’s business activities, its current financial
position and factors likely to affect its future development
are set out within the Board Report and Operating and
Financial Review.
The association has in place long-term debt facilities
which provide adequate resources to finance committed
reinvestment and development programmes, along with the
association’s day to day operations. The association also
has a long-term business plan which shows that it is able to
service these debt facilities whilst continuing to comply with
lenders’ covenants. The association maintains sufficient
liquidity to meet ongoing cash flow requirements.
On this basis, the board has a reasonable expectation that
the association has adequate resources to continue in
operational existence for the foreseeable future, being a
period of at least twelve months after the date on which
the report and financial statements are signed. For this
reason, it continues to adopt the going concern basis in the
financial statements.
Turnover and Revenue Recognition
Turnover represents rental and service charge income
receivable, fees receivable, revenue grants from the Homes
and Communities Agency and other public authorities and
sale proceeds from first tranche shared ownership sales.
Income is recognised from the point when properties are
first let, net of any voids. Income from first and subsequent
tranches sales, and properties built for sale is recognised
at the point of legal completion of the sale. Revenue grants
are receivable when the conditions for receipt of agreed
grant funding have been met. Charges for care and support
services funded are recognised as they fall due under
contractual arrangements.
Value Added Tax
The Association is Value Added Tax (VAT) registered under
a group registration. It is able to recover part of the VAT it
incurs on expenditure, using a partial recovery calculation
mechanism. The financial statements include VAT to the
extent that it is suffered by the association and is not
recoverable from HM Revenue and Customs. The balance
of VAT payable at the year-end is included as a current
liability in the accounts of the parent entity, Accord Housing
Association Limited.
Taxation
Current tax is recognised for the amount of income tax
payable in respect to the taxable surplus for the current
or past reporting periods using the tax rates and laws
that have been enacted or substantively enacted by
the reporting date.
Financial Statements 2017
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