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.
As at 31 March 2018 Accord Group Treasury Limited is the only remaining operational subsidiary of Accord Housing Association Limited. The activities of this subsidiary are not material to Accord Housing Association Limited and as such group accounts have not been prepared.
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 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. 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.
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.
Pension costs The Association primarily operates a defined contribution pension scheme, the costs of which are written off to the Statement of Comprehensive Income in the period in which they are incurred.
There are a limited number of employees who participate in the Social Housing Pension Scheme( SHPS), a multi employer defined benefit scheme to which the Association contributes. It has not been possible to identify the share of underlying assets and liabilities belonging to individual participating employers. The charge to the Statement of Comprehensive Income represents the employer contributions payable to the scheme for the accounting period.
Contributions payable by the Association to SHPS under the terms of its funding agreement for past service deficits are recognised as a liability within other provisions in the Association’ s financial statements, in accordance with the requirements of FRS 102.
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