The Scout Association Annual Report 2010-11 by Deniz Tekkul

www.scouts.org.uk

Welcome Our Chairman reflects on the highlights and achievements of 2010/11 and looks ahead to 2018. Growing Scouting is one of the priorities that unites everyone in the Movement and was a main objective when I joined the Board of Trustees last year. Recruiting and retaining enough volunteers to reduce our joining list will ensure our Movement thrives. And for the sixth consecutive year I’m pleased to say that national membership numbers have increased. Locally, almost 60 per cent of all Districts grew. More girls than ever are joining the adventure. Currently, over 66,000 girls and young women are enjoying Scouting – a rise of over seven per cent from 2010. Interest from young people in the Muslim community has also increased, strengthening our place in all communities in the UK. We continue to be an organisation that is relevant in today’s society. Our Scouts Speak Up events, at three party conferences, gave 200 Scouts the opportunity to ask 35 MPs about issues important to them. The Don’t Raise our Rents! campaign, asking local councils not to raise Scout Group group rents, is generating change and debate. We launched our first ever iPhone application, My Badges, which makes volunteering easier by allowing leaders to access our programme of badges and awards at any time. Other Scout-branded products will benefit Scouting too. This year the World Scout Committee granted Scout Shops Limited (SSL) – a wholly-owned subsidiary of The Scout Association – the licence to distribute world Scouting products and publications. In difficult economic times, it means we can generate more income to support our future work. We are coming to the end of our 2012 vision which we set a decade ago. We took a long hard look at where we were and where we could be. Our increased membership figures are a result of the ambitious five objectives that we set ourselves then. We’re now working with Members to achieve our 2018 Vision so that together we can continue to make a positive impact in local communities. Being in the Scouts had a huge impact on who I am today and I’m confident that even more young people will benefit from the empowering experience that we offer in the future. I’d like to end by saying a huge thank you to our fantastic volunteers. Their enthusiasm and dedication shines through in all the achievements you will read about in this annual report. We are also enormously grateful to all who have helped us financially. Without their help we could not provide as much as we do.

Sir Alan Craft Chairman, The Scout Association

Contents Our purpose and method

Chapter 1: Strategic aims and performance

A growing Movement

A youth Movement

A relevant and focused Movement

A sound Movement

A diverse Movement

Chapter 2: Our finances

Chapter 3: Our Members

Chapter 4: How we operate

Structure and membership Our thanks

44 45

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Our purpose and method The purpose of Scouting is to contribute to the development of young people in achieving their full physical, intellectual, social and spiritual potential – as individuals, as responsible citizens and as members of their local, national and international communities. The method of achieving this is by providing an enjoyable and attractive scheme of progressive training, based on the Scout Promise and Law, and guided by adult leadership. This method involves young people working in partnership with adults; enjoying what they are doing; learning by doing; participating in varied and progressive activities; making choices for themselves; taking responsibility for their own actions; working in groups; taking increased responsibility for others; taking part in activities outdoors; sharing in prayer and worship; and making and living out their Scout Promise. The Association’s Trustees have a duty to report on the Association’s public benefit in the Annual Report. We have assessed our aims, objectives and activities and believe we have met the Charity Commission’s public benefit criteria for both the advancement of education and the advancement of citizenship or community development. The Movement complies with the two key principles set by the Commission with regard to public benefit: 1) Identifiable benefit: The practice of Scouting and the application of the Scout method help young people develop towards their full potential. This benefit is directly linked to the purpose of Scouting. 2) Public benefit: Scouting is a national Movement open to young people aged from 6-25; full membership is restricted to young people who are willing to make the Scout Promise. The Association does not exclude those in poverty from its benefits. While the Association charges a subscription to its Members, the benefits of Scouting are not restricted by the ability to pay. Locally, there are arrangements to waive subscriptions and other costs for those who cannot afford to pay; nationally there are funds available for uniform and activities so that young people are not excluded from activities by virtue of being unable to pay. Any private benefits of Scouting are incidental.

STRATEGIC AIMS AND PERFORMANCE

: 1 r e t Chap egic Aims Strat erformance and P We have grouped our activities under five headings, that by 2012 we will be: • A growing Movement • A youth Movement • A relevant and focused Movement • A sound Movement • A diverse Movement

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A growing Movement Aim: We will grow our youth and adult membership by recruiting more volunteers and better supporting our current leaders.

What we said we’d do

How we did

• More adults and young people are enjoying Scouting every week, but there are still 33,000 young people waiting to join. We will identify issues with youth membership joining lists and increase the number of adult volunteers each year by at least three per cent to bring this number down. • We will support existing leaders, especially in delivering challenging aspects of our programme to make sure their Scouting experience is enjoyable. • We plan to make Scouting more visible and attractive to all communities, focusing on benefits and impact.

We have increased both adult and youth membership by 1.8 per cent. Locally, almost 60 per cent of all Districts grew, 300 by over three per cent.

Challenge ahead • We want to increase youth membership overall by at least three per cent. Ensuring better retention of young people as they move between sections will help us do this, as will identifying reasons why the number of Cub Scouts around the age of nine has reduced. • We will focus on recruiting former youth members and parents to increase the overall number of adult volunteers in Scout Groups by at least five per cent • We will define a benchmark for programme quality and put practical measures in place to support leaders in meeting it.

Joining lists continue to be an area of concern and we are making progress in tackling them. Our UK Chief Commissioner’s team of senior volunteers are prioritising this at their County and Regional meetings. Membership issues are also now a regular feature of Regional meetings and reviews, helping us to focus on growing the Movement locally. The use of start-up grants for local volunteers to open new Scout Groups is a proven step to help more young people join. We provide 300 start-up grants on average each year. The launch of Scout Active Support has allowed people to give their time to Scouting on a flexible basis; increasing adult volunteering. Targeted emails to section leaders are continuing to introduce the concept of flexible volunteering in local Scouting. The Big Adventure, encompassing any camp or event between May and September, helped more parents get involved with Scouting events. On average, eight parents were involved in each local Big Adventure event. To better support Scout parents we further promoted the parent welcome pack and sent out our monthly e-newsletter, Adventure News, to 45,000 people. We’ve introduced twice-yearly induction days and additional management resources for key managers, in particular supporting District Commissioners and Group Scout Leaders. District Commissioners have told us that the enhanced induction process offers a valuable start in their role. Improvements to our recruitment packs have been delayed and will now be completed in the coming year. Our new range of guidance materials are supporting leaders to deliver aspects of our Global and Beliefs and Attitudes programme, which they have found challenging. This included resources and online programme ideas produced in partnership with four global non-governmental organisations. Our plans to improve the online programme support we provide to leaders were delayed but a content review is now underway. We have commissioned an independent impact assessment, that will better equip us to articulate and present the benefits of Scouting to potential funders, volunteers and employers. We have completed interviews and focus groups with over 2,500 people, including volunteers and youth members, public and private organisations and former Scouts. Findings from the research will be published next year.

My Scouting story ‘When I started at Stirling University I wanted to stay involved in Scouting. With help from the District and Regional structure in Scotland, we started a local Beaver Colony. Raploch is one of Scotland’s most deprived areas and I wanted to do something useful while I was studying. In just a year, it’s had a big impact on the children and the community. Concerns that the community wouldn’t take to the idea of Scouts were completely disproved after such a welcome reception.’ Mark Wright, Beaver Scout Leader and University student, Scotland

STRATEGIC AIMS AND PERFORMANCE

A youth Movement Aim: We want more young people to be actively involved in leading Scouting.

What we said we’d do

How we did

• We need to do more to directly involve our 11 to 25 year olds in the Movement. One of the main ways we’ll do this is by supporting and training adult volunteers to get young people involved in running Scouting locally. • We want to see a culture of youth involvement across the Movement, as this will help ensure it is an integral part of all relevant projects. • We will continue to train volunteers to be Media Development Managers. They will help young people talk to the media about Scouting.

We held three pilot Inspire events, which were attended by a total of 30 people aged 14 to 25. These were designed as a way for us, at a national level, to consult directly with young people on Scouting issues. Their views will be incorporated into our youth involvement plan for the coming year but we have decided not to continue with national Inspire events due to low turnout. We’re looking into different options to take youth involvement work forward, particularly focusing on how young people can be consulted at County level rather than Regional and national level events.

Challenge ahead

We trained over 300 young people from across the UK to become the face and voice of Scouting in the media, to be interviewed on radio, in print and on TV. We trained over 60 regional volunteers to become Media Development Managers for their local area. They help us spread the word about Scouting and are given ongoing support from headquarters communications staff.

• Our youth involvement work will focus on how we can support Explorer Scouts to lead themselves. • We’ll research ways we can involve youth members locally, producing practical tools that will change the way we work with them across the Movement. • Reviewing and developing our national youth representatives system will also help us to enhance and embrace the culture and participation of young people.

A dedicated head office and volunteer team has begun working on how we can better involve all young people in Scouting. The youth involvement working group is building an understanding of what youth involvement means in practice, and will provide leaders with practical tools to get more young people involved locally. It will also review and develop the Nominated Youth Representatives system (currently each Scout County nominates one youth representative to the Council of The Scout Association).

My Scouting story ‘We’ve set up a Youth Council in Hampshire. It’s a chance to have our voice heard, and for Hampshire Scouting to progress up the youth participation ladder. We’re aged 13-21, and we’re deciding where we want to meet and what we should be discussing. We have two residential conference weekends a year and move it around the County. We’re already seeing the benefits and young people are much more involved in the direction of Scouting in our County. So what do I think? The verdict: amazing; I can’t wait to do it all again.’ Charlotte, Explorer Scout, England

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A relevant and focused Movement Aim: We will strengthen management and leadership in Scouting and raise awareness of our value to society.

What we said we’d do

How we did

• We will provide practical support and guidance to volunteer managers to help us review and develop the volunteer leadership and management of Scouting. • We will work towards changing the public perception of Scouting to reflect our modern Movement. • We will have a greater influence on relevant public affairs issues by better engaging with decision makers. • We will build on our Ambassadors and supporters programme to further enhance Scouting’s public visibility. • We will develop a strategic plan that will include how we work with the World Organization of the Scout Movement, the European Region and wider global Scouting.

Twelve District Commissioner and Group Scout Leader forums held across the UK helped engage Group Scout Leaders and District Commissioners in the 2018 Vision – a plan to ensure that Scouting continues to meet the needs of young people and adults. The workshops encouraged Members to bring the vision to life in their local areas.

Challenge ahead • We will convert our Vision for 2018 into our business objectives. • We will have reviewed and updated our training for new volunteer managers by April 2012. • Our work will strengthen the positive public perception of Scouting; we’ll hold a fashion event to engage current and new Ambassadors. • We will run events at party conferences and contribute to all party parliamentary groups to further increase Scouting’s impact on public affairs. • We will contribute more on a global level by sharing best practice on programme and adult training as well as strategic planning. • We will increase our partnerships with at least three National Scout Organisations in countries where Scouting is less developed.

We are reviewing the various resources that help managers through the challenging aspects of their role, including the review process, giving difficult feedback, and dealing with reassignment and retirement. We’ve also trialled new approaches to ensure each Group has an effective Group Scout Leader in eight Districts. Despite a slow start in some of these Districts, the project is now well underway, supporting the development of leaders’ skills. We demonstrated our relevance and value to the wider community through a new Scouting programme covering sexual health and relationships for our Explorer Scout section (aged 14-18). Over 140 pieces of media coverage promoting our increasing membership figures also helped showcase our relevance. Scouts Speak Up events at three party conferences gave 200 Scouts the opportunity to ask 35 MPs about issues important to them. Meg Hudson, a leader from Derbyshire, gave evidence to the education select committee inquiry into Services for Young People – demonstrating how Scouting empowers, challenges and develops. Evidence we gave to the Protection of Freedoms Bill committee helped scale back plans to change the Vetting and Barring Scheme for recruiting volunteers. To help dispel stereotypes about Scouting we produced a video that local volunteers can use to change people’s perceptions. Think you Know Scouting? Think Again received over 20,000 hits on YouTube and is a fantastic tool for promoting local Scouting. The Don’t Raise our Rents! campaign, asking local councils not to raise Scout Group ground rents, was supported by the Minister for Local Government and received 278 positive media stories on its launch day. Outcomes will be reported next year. We’ve constructed a new strategy to recruit Ambassadors and develop the work that we do with our supporters to help them put Scouting in the public eye. Our International team is supporting Commonwealth Scouting Associations to devise better communications that will help their member countries share information, advice and resources. Regular newsletters, a dedicated website and an accessible online forum are being developed.

My Scouting story ‘We visit a local retirement home once a fortnight to help the tenants use computers and get online. We focus on teaching them how to use the internet to connect with other people; be they family and friends who live far away or people locally. Much of the technophobia that previously existed has been replaced with a desire to learn and understand.’ Gregory, Explorer Scout, Wales

STRATEGIC AIMS AND PERFORMANCE

A sound Movement Aim: We will continue to soundly manage our finances and systems, raising new income and supporting our staff and volunteers.

What we said we’d do

How we did

• We will aim to improve our fundraising performance and develop other income strategies in challenging economic times. • We will maximise our income generating opportunities by raising our charity profile, developing better product ranges, and further promoting our centres of excellence to Scouting and the general public. • We will recruit an internal communications team, to develop an effective internal communications strategy and continue to support and develop all professional staff, as well as our volunteers.

We’ve put together a five-year plan to create new income by focusing on fundraising such as charity challenge events and alumni activities. Corporate partnerships income exceeded its target by more than 15 per cent (£60,000) but in line with a decline in giving across the charity sector, our income from legacies decreased. We are continuing to develop relationships with trusts and foundations to fund our work including The Freemasons’ Grand Charity and the Garfield Weston Foundation.

Challenge ahead • We will ensure that our approach to risk management is consistent with Charity Commission best practice guidance by March 2012. • We’ll put our review of the charity’s key financial policies and strategies into practice, improve our retail IT systems and continue to develop our IT strategy and operational plan. • Exciting business plans for Scout Shops Ltd, the new World Scout Shop Ltd and Unity (Scout Insurance Services Ltd) will be developed and finalised. • In October 2011, we will launch a nationwide Scout Promise Challenge fundraising initiative.

Following a consultation with Members, we will be introducing a socially responsible investment policy. This ensures that we are meeting the principles of the Association and the views of our Members while still meeting the performance objectives. This will be implemented in the coming year. We have seen a 12 per cent increase in people using our National Scout Activity Centres – including new lodges at Gilwell Park. Two new activity centres opened in Bristol and the Lake District, helping us raise our profile, delivering high quality activities and residential experiences, and generating funds in these regions. Baden-Powell House Scout Conference Centre had a successful year. With more than 80 per cent repeat customers, the venue delivers high quality services and experiences. Gilwell Park Conference Centre has been affected by the loss of residential bookings and a reduction in public spending. This is endemic of the overall industry. However, Gilwell also retains a high quality score and repeat booking rate and we continue to attract new business across various sectors. The World Scout Committee recently granted Scout Shops Limited (SSL) – a whollyowned subsidiary of The Scout Association – the licence to distribute world Scouting products and publications. Scout Shops traces its origins back to 1917 and the business has continually evolved to meet the needs of modern day Scouting. Getting this new licence means we can generate income to support our work. Our three-strong internal communications team was in place by the end of 2010 and their three-year strategy (from April 2011) was approved by the Board of Trustees. It will focus on improving the relevancy, timeliness, accuracy and consistency of communications, and increasing awareness of the information and resources available to our volunteers to help them in their Scouting role. Better supporting Scouting line managers to ensure we keep valued volunteers is also a priority.

My Scouting story ‘We used funds from the Development Grants Board to fund a project called Project Lindisfarne, to deliver Scouting to more young people in northern Northumberland. The area is very rural so instead of asking young people to come to us, we took Scouting to the communities. We worked closely with schools and delivered Scouting as an after-school activity. In the past year, our youth and adult membership has increased by 34 per cent.’ Andrew Teasdale, Local Development Officer, England

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A diverse Movement Aim: We will increase the number of female youth members and the diversity of people at every level of Scouting, raising public awareness of this.

What we said we’d do

How we did

• We need to increase the percentage of female youth members. Sharing good practice, supporting managers of Groups to recruit females and working directly with District Commissioners to create change will help us do this. • We will analyse adult membership demographics and develop and implement a diversity framework and equal opportunities policy to increase the diversity of leadership teams at all levels. • We will also increase the social and ethnic diversity of our membership and raise public awareness of this.

We have supported District Commissioners and Group Scout Leaders to develop mixed Scouting starting by identifying Districts and Groups where there were no female youth members. Over 66,000 girls and young women are now enjoying Scouting – a rise of over seven per cent from 2010.

Challenge ahead • We will analyse the gender profile of adult volunteers, identifying actions to address any challenges we uncover to help get more female youth members joining. • A demographics report, based on the data from our membership database, will be published to support our work to increase the diversity of Scouting leadership teams. • We will also produce ‘inclusion indicators’ for Counties and Districts by March 2012.

Our research analysed gender and age data of the current adult membership and the results have informed our plans to increase the diversity of leadership teams. As a result, we are creating volunteer Diversity Ambassadors and County-appointed inclusion teams to help put our diversity framework into action. We planned to research the need for and, if appropriate, develop vulnerable adults guidance by the end of this year but this has been delayed. However, consultation for this work is now complete and the final report is being considered. We attended a series of high profile national events to promote Scouting to a variety of different communities, increasing public awareness and supporting local recruitment. These included Ipswich Mela, London Pride and the Global Peace and Unity conference. Interest in Scouting from the Muslim community has continued, with a 19 per cent increase in the number of young people experiencing Scouting in predominantly Muslim Groups.

My Scouting story ‘In Northern Ireland, there are few opportunities for young people from different communities to meet and co-operate because the education system is separated. It’s therefore important that Scouting takes a lead role in trying to develop such links. We set up a project to run diversity training for leaders, to give them a chance to explore perception stereotypes with their Scouts. As leaders we’re guiding them, so they have had a chance to change their minds. It has affected me personally as it’s given me some insight into how my ideas and stereotypes of different people have changed. We don’t want the young people to make the same mistake we did, and this project gives us a chance to do this.’ Trevor Hendren, volunteer, Northern Ireland

OUR FINANCES

: 2 r e t Chap S E C OUR FINAN

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FINANCIAL REVIEW 2010/11 was another successful year for the Association, particularly in terms of the continued increase in membership of both young people and leaders. Financially 2010/11 continued to be challenging, largely as a result of the economic recession. Unity Insurance Services and the National Scout Activity Centres saw turnover and net profit growth. But other areas, including the Conference Centres, fundraising, Scout Insurance (Guernsey) Limited and Scout Shops Limited saw either small declines against last year or small underperformance against target. This was against a backdrop of continued volatility in the financial markets, rising unemployment, rising costs and an economic recession. With interest rates remaining at an all time low, investment income was lower than previously achieved for both the Association and Scout Insurance (Guernsey) Limited. The year saw support and overhead costs remaining well controlled and a small increase in charitable expenditure in core operational activities and grants while still achieving a broadly break-even position. The value of the Association’s investments increased by £0.6m and the defined benefit pension scheme deficit decreased by £3.8m. In line with accounting standards, heritage assets were included within tangible fixed assets on the balance sheet for the first time and valued at £2.4m. Further details of the revised accounting for heritage assets are included in notes 3 and 10 of the financial statements. Overall the Association’s reserves increased by £6.8m.

Financial Results The Association’s financial result was broadly break-even in the year compared with the previous year’s surplus of £0.9m. The unrestricted operating surplus, before recognised gains and losses, was £0.5m, whereas the restricted deficit was £0.5m.

Net unrestricted incoming resources before ‘one-off’ items Net restricted (outgoing)/incoming resources before ‘one-off’ items

2011 £m

2010 £m

1.0

0.4

(0.5)

0.4

Surplus on disposal of assets

0.0

0.9

Special Pension Contributions

(0.2)

(0.4)

Movement in pension scheme deficit recognised in resources expended

(0.3)

(0.4)

Net incoming resources

0.0

0.9

Net gains on investment assets

0.6

2.6

Valuation of heritage assets

2.4

Actuarial gains/(losses) on defined benefit pension scheme

3.8

(1.0)

Increase in funds

6.8

2.5

The operating results in both 2011 and 2010 include several non-standard items: £0.2m (2010: £0.4m) Special Pension Contributions, £0.3m (2010: £0.4m) movement in the pension scheme deficit and £0.0m (2010: £0.9m) surplus from asset disposals. The net unrestricted income before these ‘one-off’ items was a surplus of £1.0m (2010: £0.4m). A combination of an increase in the value of the defined benefit pension scheme’s assets and a decrease in the scheme’s liabilities caused an actuarial gain as measured by Financial Reporting Standard 17 of £3.8m, while the improvement in world equity and bond markets caused an unrealised gain of £0.6m (2010: £2.6m) on investments.

Incoming resources Total incoming resources for the year amounted to £23.6m compared with £24.0m last year. Net profits at Unity Insurance Services, the National Scout Activity Centres and Baden-Powell House were ahead of the previous year whereas Scout Shops Limited was ahead of target but down on last year due to one-off income in 2010. Fundraising and Gilwell Park Conference Centre income were lower than both last year and expectations, mainly due to the tougher economic environment.

OUR FINANCES

In June 2009 the Trustees decided that the net national membership subscription for 2010/11 should increase to £19.00 per Member, after a 50p rebate for prompt payment. With the growth in membership this resulted in membership fee income rising by 5.8 per cent to £8.8m. Donations, legacies and similar income amounted to £0.8m, a decrease of £1.0m on 2010. The level of income was down on last year due to a one-off £1.0m restricted donation received during 2009/10. Legacy income was £0.2m lower at £0.2m following the receipt of some significant legacies in the previous year. Other fundraised income was £0.7m, a £0.3m increase on the previous year but below expectations. Activities for generating funds include the retail sales of Scout Shops Limited, sponsorship and promotional income, together with nonScouting income generated by Baden-Powell House and Gilwell Park Conference Centre. This income increased by £0.3m to £7.6m due to higher retail sales (£0.2m) and the continued success of the sponsorship and partnership activities (£0.1m). Investment income was unchanged at £1.0m although this is still significantly below historic norms due to the continuing low interest rates. Incoming resources from charitable activities comprise the income from the sale of goods and services as part of the charitable activities of the Association and of ancillary trades carried on in support of its primary purpose. These include camping, training, activity and accommodation charges at Baden-Powell House, Gilwell Park and the other National Scout Activity Centres. In addition, there are Scout Information Centre sales, insurance commissions earned both by Unity Insurance Services and Scout Insurance (Guernsey) Limited and income from the disposal of tangible fixed assets. Incoming resources from charitable activities fell by £0.2m to £5.3m primarily due to the receipt of £0.9m from the disposal of fixed assets in 2010. Most other areas showed small increases with £0.3m (2010: £0.0m) being received from participants in the World Scout Moot.

Incoming resources 2010/11 (£23.6m)

50 40

Charitable activities – Scouting’s Centenary Charitable activities Investment income Activities for generating funds Donations, legacies and similar income National membership subscription

30 20 10 0

2007/8

2008/9

2009/10

2010/11

Resources expended Resources expended of £23.6m were lower than expectations but £0.5m more than last year with fundraising costs decreasing by £0.2m, retail trading expenditure increasing by £0.5m and charitable expenditure increasing by £0.3m. The increase in the cost of trading goods sold and retail operating costs from £3.7m to £4.2m reflects the increase in retail turnover and higher distribution costs, the latter closely related to the significant increase in both fuel and packaging costs. Expenditure on charitable activities totalled £18.2m (2010: £17.9m). The expenditure has been analysed under the following headings: • Youth Programme and Activities (eg updating and provision of youth programme resources) • Development of Scouting (eg external relations and Regional Development Service) • Adult Support and Training (eg members’ records and updating adult training material) • Support and Services to the Scouting Movement (eg safeguarding children, insurance and Information Centre) The £0.3m increase in charitable expenditure was principally due to increases in Youth Programme and Activities and Adult Support and Training, with a small decrease in Development of Scouting.

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Our spend on charitable activities 2010/11 (£18.2m)

31% 18%

22%

29%

2009/10 (£17.9m)

32% 16%

21%

31%

Support and services to the Scouting movement Youth programme and activities Adult support and training Development of Scouting

The Trustees consider that it would be misleading to try to analyse the resources expended on charitable activities under the five strategic aims that we use to group our strategic objectives, our activities and our achievements. Many of the actions and activities that achieve the strategic objectives are led and delivered by volunteers and incur proportionately less financial expenditure due to this mobilisation. To analyse the expenditure on charitable activities under these five aims would therefore materially distort the importance of some of the aims and objectives. Instead the Trustees consider that the four headings used to analyse expenditure on charitable activities provide a more meaningful and appropriate explanation of our spending priorities. Support costs comprise the expenditure that enables a fundraising or charitable activity to be conducted, but do not in themselves constitute a charitable activity. They include finance, information technology, human resources, legal costs, irrecoverable VAT, central management and depreciation. They have been attributed to the costs of generating funds and to charitable activities based on an estimate of staff resources employed in delivering these activities. Governance costs are incurred in meeting the Association’s compliance with constitutional and statutory requirements. They were unchanged at £0.1m.

Gains on investment assets The gains of £0.6m (2010: £2.6m) represent the difference between the market value of our investment portfolios at the start and end of the financial year.

Reserves The Scout Association’s consolidated reserves increased by £6.8m to £45.8m at the end of the year. £2.4m of this increase was due to the inclusion of heritage assets for the first time this year. A net cash outflow of £0.9m was incurred, mainly due to continued investment in the National Scout Activity Centres and other infrastructure. Included in consolidated reserves is £0.1m goodwill on the reversion of the lease of Great Tower Scout Activity Centre, £2.4m heritage assets, £17.8m funds invested in fixed assets, Restricted and Endowment Funds of £3.5m, funds retained in subsidiaries of £4.2m and £3.3m negative pension reserve. A further £6.4m has been set aside into designated funds to meet future calls on the Association’s finances, including buildings at Gilwell Park, development of the National Scout Activity Centres, the provision of grants towards attendance at future World Scout events and to further support the future growth and development of Scouting in the UK.

General Reserves During the year the Trustees have conducted a fundamental review of the Association’s general reserves policy. The Policy has been established to protect the Association and its charitable programme by providing time to adjust to changing financial circumstances. It also provides parameters for future budgeting and strategic plans and contributes towards decision making. The Association’s Reserves Policy establishes an appropriate target range for the level of general reserves. The range is based on a risk assessment of the probability and likely

OUR FINANCES

impact on the Association’s activities that might be caused by a decline in income, an inability to meet financial obligations, or an inability to reduce expenditure in the immediate short term. The policy ensures a balance between spending the maximum amount of income raised as soon as possible after receipt, while maintaining the appropriate level of reserves to ensure uninterrupted operation. The policy and target range will be reviewed annually to reassess the risks and reflect changes in the Association’s income, financial obligations and expenditure. At the end of March 2011 general reserves were £14.6m, an increase of £0.7m in the year and representing approximately eight months of the Association’s unrestricted resources expended. This is approximately £4m more than the upper level of the range. During the coming year the Trustees will be reviewing the Association’s financial strategy to determine appropriate plans to bring the level of general reserves within the target range in an agreed time period.

Intangible Fixed Assets On 31 March 2011 the lease of Great Tower Scout Activity Centre reverted to the Association from the tenant West Lancashire County Scout Council for an agreed sum. On the same date the Association acquired Oakleaves, an adjoining property, for £0.5m. The fair value of the Great Tower Activity Centre assets was £0.7m with £0.1m goodwill. The goodwill will be amortised over five years commencing April 2011.

Tangible Fixed Assets The Association maintains a collection of Scouting memorabilia, artefacts and works of art, including collections of paintings, furniture and other household and military items received from the founder of Scouting, Lord Baden-Powell. In line with accounting best practice for heritage assets, the Association has valued the fine art, statues and other major items where the nature of the items permits sufficiently reliable valuation. The valuation was conducted by Lyon & Turnbull and valued these items at £2.4m. During the year the Association, Scout Shops Limited and Scout Insurance Services Limited have made significant capital investments in a combination of the infrastructure and equipment at the National Centres and in information technology systems.

Volunteers During the year over 100,000 adults volunteered their time, energy, skills and commitment to Scouting at Group, District, County, Region or National level. This ranged from regularly leading a Section meeting, organising a camp, to helping with administration, training future Leaders and attending meetings at every level. Without this contribution, Scouting would be unable to offer the wide range of challenging and inspiring activities that ensures that Scouting is the largest co-educational youth Movement operating in the UK today.

Scout Shops Limited Scout Shops Limited is a wholly-owned subsidiary of The Scout Association that is incorporated in England selling Scouting and ancillary products mainly to Members of The Scout Association. During the year Scout Shops continued to focus on developing its core business and key customer base, the Scout Movement, and offering a high level of service to our Members. Turnover in the year increased by 5% to £6.2m (2010: £6.0m) and operating costs were £4.2m (2010: £3.7m). The company delivered a profit after taxation of £2.1m (2010: £2.5m including £0.3m of exceptional income) with 100 per cent of the taxable profits donated to The Scout Association.

Scout Insurance Services Limited Scout Insurance Services Limited is a wholly-owned subsidiary of The Scout Association that is incorporated in England and trades under the name Unity Insurance Services. Its principal activity is that of an insurance broker providing insurance broking services in the main to The Scout Association, the Scout Movement and increasingly to other not-for-profit organisations. In the year to March 2011, Unity Insurance Services generated a profit after taxation of £0.3m (2010: £0.2m). The taxable profit was donated to The Scout Association.

Scout Insurance (Guernsey) Limited Scout Insurance (Guernsey) Limited is a wholly owned subsidiary of The Scout Association that is incorporated in Guernsey. Its principal activity is that of an insurance captive. The company continues to play an important role in enabling the Association to manage its insurance costs in an effective manner while helping to limit the risk of a material claim in an increasingly litigious society. In the year to March 2011 the net profit before taxation decreased to £0.7m (2010: £0.8m) primarily due to the level of claims and lower investment income. During the year the directors paid a dividend of £0.6m to the Association.

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Scout Services Limited Scout Services Limited is a wholly owned subsidiary of The Scout Association that is incorporated in England. Its principal activities are that of commercial property management, fundraising and sponsorship activity on behalf of The Scout Association. Scout Services Limited produced a net profit of £0.6m (2010: £0.5m) that was donated to the Association. The increase in profit was principally due to the transfer of some increasingly commercial activities that had previously been reported within the Association’s own accounts.

The Scout Association Defined Benefit Pension Scheme The most recent full actuarial valuation of The Scout Association Defined Benefit Pension Scheme was carried out as at 31 March 2010. The market value of the assets of the scheme was £25.7m and the actuarial value of those assets represented 83 per cent of the value of the benefits that had accrued to members. Based on this valuation the Trustees have agreed a funding plan to address the deficit. The valuation of the defined benefit pension scheme at 31 March 2011, for the purposes of Financial Reporting Standard 17 (FRS 17), showed a funding deficit of £3.3m (2010: £6.9m). The decrease in the liability is due to an increase in the fair value of the scheme’s assets and a decrease in the value of the scheme’s future obligations. The decrease in the liabilities as determined under FRS17 is due to a combination of factors including a reassessment of some of the key assumptions used in the valuation to reflect recent decisions by the Scheme Trustees and the Association and to be consistent with the assumptions used in the March 2010 actuarial valuation. These include: • Members will start to receive their pension when they reach their contractual retirement age. • Inflation to be based on CPI rather than RPI. This is consistent with recent changes by the UK government. • Members take 15 per cent of their pension benefits as cash on retirement. The Association contributed £0.5m (2010: £0.8m) to the scheme, including special contributions totalling £0.2m (2010: £0.4m). The cash flow required to meet the £3.3m deficit relates to future pension contributions. Therefore, this deficit is expected to arise over the long term rather than in the immediate future, and the amount of the deficit is subject to considerable variability because it depends on a range of demographic and financial assumptions, which are likely to change over time. The scheme was closed to new members in the year ended 31 March 2001 and the Trustees regularly monitor the pension scheme funding deficit to ensure that general reserves provide adequate cover against the future liability. In accordance with Charity Commission guidance (‘Charity Reserves and Defined Benefit Pension Schemes’), the Trustees have reviewed the cash flow impact on general reserves of the planned funding of the deficit. Since this is met from anticipated future income streams a separate designated fund is not required.

Short Term Investment Service As at 31 March 2011, deposits by Scout Groups, Districts, Counties and Regions in the Short Term Investment Service totalled £13.4m (2010: £14.9m), a decrease of £1.5m in the year. These funds generated investment income for depositors of £0.1m (2010: £0.1m).

National Membership Subscription In June 2010 the Trustees decided that the National Membership Subscription for 2011/12 would increase by 3.8 per cent to £20.25 per Member with a rebate of 50p for prompt payment. This was after careful consideration of our income growth and diversification, cost pressures including addressing the pension deficit and the latest three-year rolling forecast. In the light of the information available the Trustees agreed a below inflation increase would continue to send a positive message to the Movement following the stated objective of reducing reliance on the membership fee income.

Investment Policy The annual review of the investment policy made no changes to the Association’s performance objectives, which remained: • To maintain an optimum level of income tempered by the need for capital growth in order to safeguard future grant-making capacity. • To outperform benchmarks on a rolling three year basis. Following a consultation with the Members, the Trustees have agreed to incorporate within the investment policy a Socially Responsible Investment (SRI) requirement that reflects the principles of the Association and the views of the Members while still meeting the performance objectives. A review of potential investment funds has been undertaken and in the coming year the Trustees plan to implement these additional investment requirements. As at 31 March 2011 the investment portfolio asset ratio was 40 per cent equities, 29 per cent bonds and 31 per cent cash. This is in line with the ratio range agreed by the Trustees in the investment strategy. Investment income of £1.0m was slightly ahead of target due to a combination of higher than forecast cash and dividends holding up better than expected.

OUR FINANCES

Trustee responsibilities The Trustees are responsible for preparing financial statements for each year which give a true and fair view of the Association’s financial activities during the year and its financial position at the end of the year. They are responsible for keeping accounting records, which disclose the financial position of the Association and to ensure that the financial statements comply with applicable law. They are also responsible for safeguarding the assets of the Association and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities and to provide reasonable assurance that: • The Association is operating efficiently and effectively. • Its assets are safeguarded against unauthorised use or disposition. • The Association complies with relevant laws and regulations. Systems of internal control are designed to provide reasonable, but not absolute, assurance against material mismanagement or loss. They include: • An annual budget approved by the Trustees. • Appropriate delegation of authority and segregation of duties. • Identification and management of risks.

Derek M Twine Chief Executive & Trustee, For the Board of Trustees, 13 July 2011

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Consolidated statement of financial activities For the year ended 31 March 2011

2011

2010

Unrestricted

Restricted

Endowment

Total

Notes

£’000

Incoming resources Incoming resources from generated funds Voluntary income Membership subscriptions

3(c)

8,800

8,319

Donations, legacies and similar income

5(a)

292

545

837

1,848

9,092

545

Activities for generating funds

5(b)

7,637

Investment income

5(c)

827

Incoming resources from charitable activities

5(d)

Total incoming resources

136

9,637

10,167

7,637

7,337

963

959

5,329

5,536

22,885

681

23,566

23,999

134

135

305

5,162

4,753

Resources expended Costs of generating funds Costs of generating voluntary income Fundraising trading: costs of goods sold and other costs

6(a)

5,162 5,296

5,297

5,058

Charitable activities

6(b)

17,070

1,124

18,194

17,859

Governance costs Total resources expended Net incoming resources before transfers Transfers between funds Net incoming/(outgoing) resources before other recognised gains and losses

131

22,497

1,125

131

148

23,622

23,065

388

(444)

(56)

934

(33)

421

(477)

(56)

934

Other recognised gains and losses 2,435

2,435

Net gains on investment assets

Gains on fixed assets – heritage assets 12

508

598

2,559

Actuarial gains/(losses) on defined benefit pension scheme

3,809

(968)

Net movement in funds

Fund balances brought forward at 1 April 2010 Fund balances carried forward at 31 March 2011

7,173

(429)

6,786

2,525

35,146

2,860

1,060

39,066

36,541

42,319

2,431

1,102

45,852

39,066

OUR FINANCES

Balance sheets For the year ended 31 March 2011 Consolidated Notes

The Association

2011

2010

2011

2010

£’000

Fixed assets Intangible fixed assets

138

Tangible fixed assets

21,215

17,114

20,204

16,706

Investment in subsidiary companies

400

Investments

24,572

22,571

16,261

14,913

45,925

39,685

37,003

32,019

Current assets Stocks

607

440

136

201

Debtors

8,346

5,695

9,293

5,514 21,174

19,700

21,174

19,700

Short term deposits

Current asset investments 2

417

1,130

Bank and cash balances

4,326

4,473

926

1,464

33,396

32,912

30,055

28,353

(28,732)

(25,264)

(22,158)

(18,352)

4,664

7,648

7,897

10,001

Current liabilities Creditors

Net current assets Total assets less current liabilities Creditors – amounts falling due after more than one year

50,589

47,333

44,900

42,020

(1,485)

(1,337)

49,104

45,996

44,900

42,020

(3,252)

(6,930)

(3,252)

(6,930)

45,852

39,066

41,648

35,090

Net assets excluding pension liability Pension liability Net assets including pension liability The Association’s funds Unrestricted Funds General reserves

16(a)

14,571

13,857

14,597

13,890

Designated funds

16(b)

26,770

24,210

26,770

24,210

4,230

4,009

45,571

42,076

41,367

38,100

Non charitable trading funds Unrestricted funds excluding Pension Liability Restricted funds

16(c)

2,431

2,860

2,431

2,860

Endowment funds

16(d)

1,102

1,060

1,102

1,060

49,104

45,996

44,900

42,020

(3,252)

(6,930)

(3.252)

(6,930)

45,852

39,066

41,648

35,090

Total funds excluding pension reserve Pension reserve

Total funds

Approved by the Board of Trustees on 13 July 2011 and signed on its behalf by:

Alan Craft, Chairman of the Board

Chris Ide, Treasurer

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Consolidated cash flow statement For the year ended 31 March 2011 2011

2010

Reconciliation of net movement in funds to net cash inflow from operating activities

£’000

Net movement in funds

6,786

2,525

Investment income

(963)

(959)

Depreciation Net (gain) on investment assets Net (gain) on heritage assets Gifts in kind of heritage assets Loss/(surplus) on disposal of tangible fixed assets (Increase)/decrease in stocks (Increase) in debtors

854

818

(598)

(2,153)

(2,435)

(10)

(902)

(167)

(2,651)

(1,039)

Decrease in current asset investments

1,474

2,367

Increase in creditors

3,616

199

(3,678)

1,073

2,279

2,006

2,279

2,006

963

959

(Decrease)/increase in pension liability Net cash inflow from operating activities Cash Flow Statement Net cash inflow from operating activities Returns on investments Capital expenditure and financial investment Purchase of activity centre Payments to acquire tangible fixed assets

(703)

(2,026)

(2,427)

Receipts from sale of tangible fixed assets

1,011

Net (additions) to fixed asset investments

(1,403)

(3,236)

(Decrease) in cash

(4,102)

(4,652)

(860)

(1,687)

1. Reconciliation of net cash flow to movement in cash

(Decrease) in cash

2011

2010

£’000

(147)

(226)

(Decrease) in short term deposits

(713)

(1,461)

Movement in cash in the period

(860)

(1,687)

2. Analysis of cash At 1 April 2010

Cash Flow

31 March 2011

£’000

Cash in hand and at bank

4,473

(147)

4,326

Short term deposits

1,130

(713)

417

5,603

(860)

4,743

OUR FINANCES

Notes to the consolidated financial statements 1. Constitution The Scout Association is incorporated by Royal Charter and is a registered charity whose purpose is to promote the development of young people in achieving their full physical, intellectual, social and spiritual potentials, as individuals, as responsible citizens and as members of their local, national and international communities.

2. Scope of the financial statements These financial statements cover the activities directly controlled by The Scout Association. The activities of the Scout Councils of Northern Ireland, Scotland and Wales together with Scout Counties, Areas, Regions, Districts and Groups are not reflected in these financial statements. These bodies are separate autonomous charities that are affiliated to The Scout Association.

3. Accounting policies The financial statements have been prepared in accordance with applicable accounting standards and comply with the Statement of Recommended Practice â&#x20AC;&#x2122;Accounting and Reporting by Charitiesâ&#x20AC;&#x2122;, published in 2005, except as described in note 15.

(a) Accounting convention The financial statements are prepared under the historical cost convention as modified to include the revaluation of investments.

(b) Basis of preparation of consolidated financial statements The financial statements consolidate the financial statements of The Scout Association and its subsidiary companies. The financial statements of all entities are made up to 31 March 2011. The Balance Sheets and Profit and Loss accounts of the subsidiaries have been consolidated on a line-by-line basis as required by the Statement of Recommended Practice. On acquisition of a business all of the assets and liabilities that exist at the date of acquisition are recorded at their fair values reflecting their condition at that time. All changes to those assets and liabilities and the resulting surpluses that arise after acquisition are charged to the post-acquisition Statement of Financial Activities.

(c) Recognition of income National membership subscriptions Membership subscriptions are payable in advance for a year ended 31 March. The amount receivable for the year ended 31 March 2011 is shown in the Statement of Financial Activities. Subscriptions are treated as voluntary income because they are more similar in nature to donations than to payments for goods or services.

Investment income Dividends are accounted for on a receipts basis. Interest is accounted for on an accruals basis and includes all amounts earned up to 31 March 2011. Associated tax recoveries are included for all amounts shown as income.

Legacies Legacies are accounted for on a receivable basis as the charity becomes entitled to the income. This occurs when the charity becomes reasonably certain that the legacy will be received, the value of the income can be measured with sufficient reliability and all conditions associated with payment have been fulfilled. No significant legacies have been notified but not yet received. Where legacies include non-cash items these are included in income at the lower of probate value or market value at the date of receipt.

Gifts in kind Properties, investments, heritage assets, other fixed assets and any other assets or services donated to the charity are included as donated income at their estimated market value at the time of receipt.

Insurance income Insurance broking commission is recognised at the later of the date of inception of the policy and the date the policy was agreed with the client and insurer. The amount recognised is the total brokerage due less an overall provision for unearned commission. Historic profit commission is recognised at the date of receipt. Where historic profit commission from previous years has not been received only those amounts virtually certain of future receipt are recognised in the year as income.

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Insurance underwriting gross premium written comprises the premium due on contracts entered into in a financial year, regardless of whether such amounts relate in whole or in part to a later financial year. Reinsurance premium is accounted for in the same accounting period as the premium for the related direct insurance. Unearned premium represents the proportion of premiums written estimated to be earned in future financial years. It is calculated on a monthly pro-rata basis. Acquisition costs relating to unearned premiums are deferred on the same basis as the premiums to which they relate.

(d) Allocation of income and costs Activities for generating funds and fundraising trading: costs of goods sold and other costs Income and expenditure from Scout Shops Limited, Scout Services Limited and from commercial activities carried out at Baden-Powell House and the Gilwell Park Conference Centre are classified under these headings.

Incoming resources from charitable activities This comprises income from the provision of services supporting the objects of the Association through operations including the Information Centre, insurance services, and Scouting magazine as well as the National Scout Activity Centres. A percentage of accommodation and training fees receivable at Baden-Powell House and the Gilwell Conference Centre are also included under this heading. The percentages used in respect of these two sites are 20 per cent and 80 per cent respectively. The remaining income from Baden-Powell House and the Gilwell Park Conference Centre is included in Activities for Generating Funds. The charitable activities have been analysed under the following headings: • Youth programme and activities • Development of Scouting • Adult support and training • Support and services to the Scouting Movement The Association’s activities are largely financed by national membership subscriptions and income from the trading subsidiaries rather than income from the charitable activities. The activities have been classified as described in note 6. Where possible the income and costs relating to a department or cost centre are allocated in full to one of the above categories, but in practice many departments have an involvement in more than one activity. The other major allocations, which are reviewed annually by the Trustees, are set out below. Youth programme and activities

Development of Scouting

Adult support and training

World and European membership fees

100%

Members records and awards Membership services

20%

40%

60%

20%

40%

Safeguarding children

100%

Public relations

100%

Insurance Scouting magazine

100% 33%

33%

Short Term Investment Service

100%

Regional Development Service Baden-Powell House

Support and services

33%

20%

Gilwell Park Conference Centre

27%

Other National Activity Centres

33%

Support costs These are costs incurred directly in support of the objects of the charity. The costs are attributed to the activities that they support. Where a department supports all the charity’s activities the costs have been apportioned pro-rata to the staff resources directly engaged in that activity. The percentages that apply are: Fundraising trading

Youth programme and activities

14%

Development of Scouting

28%

Adult support and training

29%

Support and services to the Scouting Movement

23%

OUR FINANCES

Governance costs These are the costs associated with the governance arrangements of the charity which relate to compliance with legal and statutory requirements of the charity as opposed to those costs associated with fundraising or charitable activities. They include audit fees and the costs of Trustee meetings.

(e) Intangible fixed assets Intangible fixed assets represent goodwill arising on acquisitions less accumulated amortisation. Goodwill arising on acquisition of an undertaking is the difference between the fair value of the consideration paid and the fair value of the assets and liabilities acquired. It is capitalised and amortised through the Statement of Financial Activities over the Trustees’ estimate of its useful economic life which can range from five to ten years. Impairment tests on the carrying value are undertaken at the end of the first full year after acquisition and in any other subsequent period if events or changes in circumstances indicate that the carrying value may not be recoverable.

(f) Fixed Assets – Heritage assets The Association maintains a collection of Scouting memorabilia, artefacts and works of art, including collections of paintings, furniture and other household and military items received from the founder of Scouting, Lord Baden-Powell. In accordance with Financial Reporting Standard 30 - Heritage Assets, the Association’s collection of fine art, statues and other major items are recorded on the balance sheet at valuation. Periodic professional revaluations are performed at the discretion of the Trustees when conditions indicate that their valuation may have significantly changed. Any surplus or deficit on revaluation is charged to the Statement of Total Recognised Gains and Losses. The Trustees consider that obtaining valuations for the remainder of the collection would involve disproportionate cost due to the diverse nature of the assets held and the lack of comparable market values. Other than the items that have been valued as described above, the Association does not recognise these assets on its Balance Sheet. The Trustees will occasionally approve the disposal of elements of the collection; for example, when an item is of doubtful provenance. Where items that are not recognised as fixed assets are disposed of, the proceeds, net of disposal costs, are reported in the Statement of Financial Activities. Disposal proceeds are also disclosed separately in the notes to the accounts. Acquisitions are normally made by donation with occasional purchases. Donations are recorded at a current market valuation with reference, where possible, to commercial markets using recent transaction information from auctions. Recent purchases are recorded at cost. Expenditure which in the Trustees’ view is required to preserve or prevent further deterioration of individual items, including preservation work, is recognised in the Income and Expenditure Account when it is incurred.

(g) Fixed assets – Other fixed assets The cost of acquiring fixed assets used for charitable purposes is capitalised and depreciation is calculated to write off the cost of assets brought into use at the Balance Sheet date on a straight line basis over their estimated useful lives. Assets costing less than £200 are not capitalised. In the case of freehold buildings the useful life is normally taken as 50 years. Where land and buildings were acquired together it has been assumed that the buildings represent 50 per cent of the initial cost of freehold properties. No depreciation is provided on freehold land. Gains or losses on the disposal of fixed assets held for charitable use are reflected in Net Incoming Resources before Transfers shown in the Statement of Financial Activities. Fixed assets held for investment purposes are stated at market value on the Balance Sheet date. Any gains or losses on the disposal or revaluation of investment assets are shown as Net Gains or Losses on Investment Assets.

(h) Stocks Stocks are valued at the lower of cost and estimated net realisable value. Cost, using the first-in-first-out basis, consists of the original cost of goods without any addition for overheads.

(i) VAT The Association is partially exempt for VAT purposes and is not able to reclaim all the VAT it pays. It is not practicable to allocate irrecoverable VAT to the expenses and assets concerned, and irrecoverable VAT is normally written off. For large acquisitions of property, irrecoverable VAT is added to the capital cost.

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(j) Leases Significant assets held under finance leases and the related lease obligations are included at the fair value of the leased assets at the inception of the lease. Depreciation on leased assets is calculated to write off this amount on a straight-line basis over the shorter of the lease term and the useful life of the asset. Rentals payable are apportioned between the finance charge and a reduction of the outstanding obligations. All other leases have been treated as operating leases and the rentals written off as they are paid because of the insignificant amounts involved.

(k) Pension costs Contributions payable to The Scout Association Defined Benefit Pension Scheme are charged to the Statement of Financial Activities so as to spread the cost of pensions over the working lives of employees in the scheme. The pension charge is calculated on the basis of actuarial advice. The pension scheme liabilities are measured using a projected unit method and discounted at an AA sterling corporate bond rate. The pension scheme deficit is recognised in full on the balance sheet. The current service cost and net return on the scheme’s assets and liabilities for the year is allocated across the resources expended categories in the Statement of Financial Activities. The actuarial loss on the scheme for the year is included in the gains/(losses) section of the Statement of Financial Activities. Contributions towards personal pension policies, which are defined contribution schemes, are charged to the Statement of Financial Activities as they are incurred.

(l) Grants payable Grants payable are included in the Statement of Financial Activities as expenditure in the period in which the award is made. Grants which have been approved by the Trustees and agreed with other organisations but which are unpaid at the year end are accrued. Grants where the beneficiary has not been informed or has to meet certain conditions before the grant is released are not accrued.

4. Nature of funds Following the requirements of the Statement of Recommended Practice all funds have been identified as falling into one of three categories.

(a) Endowment funds Endowment funds are those received to be held as capital with only the income available to be spent. Subsequent gains or losses on the disposal of the underlying assets of the fund become part of the capital.

(b) Restricted funds Restricted funds are those received which have been earmarked for a special purpose by the donor or the terms of an appeal.

(c) Unrestricted funds Unrestricted funds are those received, which are not subject to any special restriction. They are divided between General Funds and Designated Funds. Designated Funds comprise amounts set aside by the Trustees to be used for particular purposes.

5. Incoming resources

(a) Donations, legacies and similar income 2011

2010

Unrestricted

Restricted

Total

£’000

Legacies

153

349

Appeals

1,017

Donated heritage assets, services and facilities All other income

129

543

672

442

292

545

837

1,848

OUR FINANCES

(b) Activities for generating funds 2011

2010

Unrestricted

Restricted

Total

£’000

£’000 6,078

6,256

Hostel, conference and commercial training

Retail sales

823

810

Sponsorship, promotions and royalties

558

449

7,637

7,337

2011

2010

Unrestricted

Restricted

Total

£’000

590

652

596

174

226

827

136

963

959

Quoted investments Short Term Investment Service Other deposit interest Rental income

(d) Incoming resources from charitable activities The income in this category is derived primarily from the Association’s Insurance subsidiaries and National Scout Activity Centres. Many of the activities are not conducted with the prime intention of generating net income. Instead, the Association’s charitable activities are largely financed by fundraising activities and by membership subscriptions.

Unrestricted

Restricted

£’000 Disposal of tangible fixed assets National events Information Centre sales Insurance broking and underwriting Scouting magazine advertising National Centres World Moot participant income Other income

2011

2010

Total

£’000

902

117

238

171

1,860

1,724

160

156

2,548

2,402

257

171

5,329

5,536

2011

2010

Unrestricted

Restricted

Total

£’000

£’000 3,734

6. RESOURCES EXPENDED

(a) Fundraising trading: costs of goods sold and other costs

4,226

Hostel, conference and commercial training

Retail operating costs

746

765

Sponsorship and promotions

190

254

5,162

4,753

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Hostel, conference and commercial training expenditure includes support costs of £244,000 (2010 £264,000). The basis for allocation of support costs is explained in note 6(c).

(b) Costs of charitable activities Charitable activities have been analysed into four categories as explained in note 3(d). Costs are allocated using the principles explained in that note. Youth programme and activities includes the various educational activities that members participate in. Development activities are those which are aimed at growing the Scout Movement. Adult support and training includes those activities that support leaders and other adults involved in Scouting. Support and services to the Scouting Movement includes activities such as safeguarding children and insurance, which assist the activities of Scout Groups. 2011

2010

Unrestricted

Restricted

Total

£’000

Youth programme and activities

3,125

196

3,321

2,871

Development of Scouting

4,514

714

5,228

5,516

Adult support and training

3,917

3,979

3,810

Support and services to the Scouting Movement

5,514

152

5,666

5,662

17,070

1,124

18,194

17,859

Analysis of costs of charitable activities 2011

2010

Direct Grant funding Support costs

Total

£’000

Youth programme and activities

2,547

191

583

3,321

2,871

Development of Scouting

3,165

863

1,200

5,228

5,516

Adult support and training

2,691

1,277

3,979

3,810

Support and services to the Scouting Movement

4,678

981

5,666

5,662

13,081

1,072

4,041

18,194

17,859

Grant funding Grants are paid from restricted and designated funds administered by the Association to a large number of Scout Groups, Districts, Regions, Areas and Counties in accordance with the objectives of the respective funds. Analysis of grants

Development International Fund Benevolent Fund Special Needs Ralph Reader Memorial Fund Admiralty Fund and Trinity House Fund (Sea Scout Groups) King George VI Leadership Fund Other

Grants to institutions 2011

2010

£’000

746

865

105

143

1,072

1,252

OUR FINANCES

2010

Unrestricted and Total

Total

£’000

Property and equipment depreciation

684

642

Irrecoverable VAT

396

247

Office accommodation and services

482

462

Central management

658

645

HR, legal and secretarial

531

543

Finance and accounting

370

404

Information technology

640

540

Movement in pension scheme deficit recognised in resources expended

331

555

Other

193

308

4,285

4,346

Allocated to activities Fundraising trading (Note 6a)

244

264

Charitable activities (Note 6b)

4,041

4,082

4,285

4,346

Support costs comprise the costs that enable a fundraising or charitable activity to be conducted, but do not in themselves constitute an activity. The support costs listed above have all been allocated to the costs of generating funds and charitable activities pro-rata to the full-time equivalent number of staff directly engaged in the appropriate activities. The relevant percentages are analysed in Note 3(d).

(d) Resources expended include: 2011

2010

£’000

Audit fees

Other

Auditor’s remuneration:

Trustees’ expenses reimbursed

During the year 16 (2010: 27) Trustees were reimbursed for expenses incurred attending meetings and carrying out their duties. The Association provided accommodation for the Chief Scout and others while they carried out Scout business.

7. STAFF COSTS 2011

2010

£’000

Wages and salaries

7,015

6,788

Social security costs

755

721

Other pension costs

593

595

8,363

8,104

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The average number of persons employed during the year (full-time equivalent) was: Activity The Scout Association Scout Shops Limited Unity (Scout Insurance Services) Limited Total

2011

2010

207

199

251

241

The numbers of employees whose total emoluments for the year exceeded £60,000 were as follows: 2011

2010

£60,001 to £70,000

£70,001 to £80,000

£80,001 to £90,000

£90,001 to £100,000

£100,001 to £110,000

£110,001 to £120,000

£120,001 to £130,000

£130,001 to £140,000

The Chief Executive, who is also a Trustee, received remuneration and benefits for his service as Chief Executive which amounted to £134,464 (2010: £131,525). Retirement benefits are accruing under The Scout Association Defined Benefit Pension Scheme for three (2010: four) higher paid employees. In addition, the Association paid £35,535 (2010: £23,883) into a defined contribution pension scheme for five (2010: four) higher paid employees.

PENSION SCHEMES (a) The Scout Association Defined Benefit Pension Scheme The Association operates a pension scheme providing benefits based on final pensionable salaries. The scheme is funded with the assets being held by the pension scheme’s trustees separately from the assets of the Association. The pension costs are assessed by a qualified actuary and are charged to the Statement of Financial Activities so as to spread those costs over the employees’ working lives with the Association. The scheme was closed to new members in the year ended 31 March 2001.

Triennial actuarial valuation A full actuarial valuation of the scheme was carried out as at 31 March 2010 using the projected unit method and showed a deficit of £5,100,000. The scheme’s assets and liabilities were valued in accordance with Part 3 of the Pensions Act 2004 and associated regulations and the Scheme Specific Funding framework as published by the Pensions Regulator. The market value of the assets of the Scheme as at 31 March 2010 was £25,687,000 and the actuarial value of those assets represented 83 per cent of the value of the benefits that had accrued to members, after allowing for expected future increases in salaries. The Association contributed £518,000 (2010: £803,000) to the scheme, including special contributions totalling £200,000 (2010: £450,000), and normal contributions of £318,000 (2009: £353,000), which was 20.0 per cent (2010: 20.0 per cent) of pensionable salaries.

OUR FINANCES

Financial Reporting Standard 17 (FRS 17) valuation For the purposes of FRS 17 the most recent full valuation has been updated to 31 March 2011 by a qualified independent actuary. The major assumptions used by the actuary were (in nominal terms): 31 March 2011

31 March 2010

Discount rate

5.6%

Inflation assumption - RPI

3.3%

3.5%

Inflation assumption - CPI

2.6%

N/A

Rate of increase in pensions in payment

3.3%

3.5%

Rate of increase in pensions in deferment

2.6%

3.5%

Rate of increase in salaries

3.8%

4.0%

Post-retirement mortality assumption

S1NA tables CMI 2009 projections 1% pa long-term rate of improvement

Normal retirement age

65 for non-executive actives (62 for executive 65 for non-executive actives (62 for executive actives) 65 for deferreds actives) 65 for deferreds

Tax-free cash

Members are assumed to take 15% of the value of their pension as retirement cash

Long term expected rate of return on the scheme’s assets for the following year

PA92 tables Medium cohort (based on the year of birth of each individual member)

6.31% pa

No allowance 6.48% pa

The March 2011 FRS 17 valuation includes a reassessment of some of the key valuation assumptions to reflect recent decisions by the scheme trustees and the Association and to be consistent with the assumptions used in the March 2010 actuarial valuation. These include: • Members will start to receive their pension when they reach their contractual retirement age. • Inflation to be based on CPI rather than RPI. This is consistent with recent changes by the UK government. • An estimate, consistent with the triennial valuation assumption, that members take 15 per cent of their pension benefits as cash on retirement. Under the mortality tables adopted, the assumed future life expectancy at age 65 is as follows: Life expectancy at age 65

31 March 2011

31 March 2010

Male currently aged 45

23.2

23.1

Female currently aged 45

25.6

25.9

Male currently aged 65

21.8

22.1

Female currently aged 65

24.0

25.0

The assets in the scheme and the expected rate of return were: Asset category

2011

Equities

59%

Property

Gilts

15%

Bonds

23%

Cash

Total

100%

The expected return on assets is a weighted average of the assumed long-term returns for the various asset classes. Assumed equity and property returns are based on the selection of an appropriate risk premium above the risk-free rate which is measured in accordance with the yield on government bonds. Bond returns are selected by reference to the yields on government and corporate debt as appropriate to the scheme’s holdings of these instruments. Cash returns are based on the Bank of England Base Rate. Amounts recognised and disclosed in the balance sheet at 31 March 2011

2011 £’000

Assets Fair value of assets

26,759

Liabilities Present value of funded obligations (Scheme deficit)

(30,011) (3,252)

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Amounts recognised in the Consolidated Statement of Financial Activities over the year

2011 £’000

Actuarial gain

3,809

Effect of limit on recognisable surplus

Amounts recognised in the Consolidated Statement of Financial Activities over the year

3,809

Amounts recognised in the Statement of Total Resources Expended over the year

2011 £’000

Current service cost

486

Interest on pension scheme liabilities

1,800

Expected return on pension scheme assets

(1,637)

Total

649

Reconciliation of assets and defined benefit obligation 2011

The change in assets over the year was:

£’000 Fair value of assets at the beginning of the year

25,687

Expected return on pension scheme assets

1,637

Employer contribution

518

Contributions by scheme participants

111

Benefits paid

(1,384)

Actuarial gain on assets

190

Fair value of assets at the end of the year

26,759

2011

The change in defined benefit obligation over the year was:

£’000 Defined benefit obligation at the beginning of the year

32,617

Current service cost

486

Contributions by scheme participants

111

Interest on pension scheme liabilities

1,800

Benefits paid

(1,384)

Actuarial gain on assets

(3,619)

Defined benefit obligation at the end of the year

30,011

Summary of prior year amounts

Present value of defined benefit obligation

2011

2010

2009

2008

2007

£’000

(30,011)

(32,617)

(25,904)

(27,791)

(31,445)

Scheme assets

26,759

25,687

20,047

26,896

24,371

(Scheme deficit)

(3,252)

(6,930)

(5,857)

(895)

(7,074)

Experience gains and losses on scheme liabilities

485

277

1,109

544

Experience adjustments on scheme assets

190

5,030

(7,870)

(2,503)

(490)

The level of employer contributions for 2011/12 has been set at 18.7 per cent.

(b) The Scout Association Group Personal Pension Scheme The Association also contributed £239,000 (2010: £219,000) towards individual defined contribution personal pension schemes for those employees that choose to join the scheme.

OUR FINANCES

8. NET MOVEMENT IN FUNDS The net movement in funds arises as follows:

The Scout Association Subsidiaries

2011

2010

£’000

6,565

2,333

221

192

6,786

2,525

9. INTANGIBLE FIXED ASSETS Goodwill

Consolidated

Cost At 1 April 2010

The Association

2011

2010

2011

2010

£’000

Additions

138

At 31 March 2011

138

Amortisation At 1 April 2010

Charge for the year

At 31 March 2011

138

Net Book Value at 31 March 2011

Goodwill of £138,000 arose on the reversion of the lease of Great Tower Scout Activity Centre on 31 March 2011 (Note 18). Goodwill is amortised over five to ten years straight line. No amortisation was charged in the year ended 31 March 2011.

10. TANGIBLE FIXED ASSETS a) Heritage assets

Consolidated Valuation At 1 April 2010 Additions

The Association

2011

2010

2011

2010

£’000

Valuation

2,435

At 31 March 2011

2,445

The Association maintains a collection of Scouting memorabilia, artefacts and works of art, including collections of paintings, furniture and other household and military items received from the founder of Scouting, Lord Baden-Powell. Some of these items, including statues and paintings, are displayed within the buildings and grounds of Gilwell Park and Baden-Powell House but most of the collection is held in a secure storage area. Included in the development plans for Gilwell Park is a new Heritage Centre which would enable more of the items to be on public display. An inventory of the entire collection is maintained, including valuations where these can be obtained and provide a meaningful insight into the value of the asset. A number of paintings, statues and other exhibits are on display in the White House and around the grounds at Gilwell Park, and at Baden-Powell House. The majority of items held are not on display, as there is currently nowhere suitable to display them. Access to those items not on display is permitted to historians and other people with a keen interest in them by appointment with the Association’s Archives and Heritage Manager. These items are held in support of the Association’s objective of increasing knowledge, understanding and appreciation of the history of Scouting and its place in society.

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Financial Reporting Standard FRS30 ‘Heritage Assets’ has made it mandatory for heritage assets to be reported as tangible fixed assets in the balance sheet, where information is available on cost or valuation, for accounting periods commencing on or after 1 April 2010. A valuation is provided for the Association’s collection of fine art, statues and other major items since the nature of these items permits sufficiently reliable valuation. The valuation is based on insurance values and was prepared by Lyon & Turnbull, members of the Society of Fine Art Auctioneers and Valuers, on 26 April 2011 and in the opinion of the Trustees is applicable to the 31 March 2011. The Association has brought its heritage assets into the balance sheet for the first time in the year ended 31 March 2011. No reliable information is available on the cost or valuation of the same items as at 31 March 2010 and hence this is reported in the balance sheet at nil. As a consequence, during the year ended 31 March 2011 the full amount, £2,435,000, has been recognised within other recognised gains and losses. The Association maintains the heritage assets collection in a good condition, and none currently require substantial restoration expenditure.

b) Other fixed assets Consolidated

Cost At 1 April 2010 Additions Disposals At 31 March 2011

Freehold property

Leasehold property

Furniture, fittings and equipment

Motor vehicles

Total

£’000

17,811

1,074

4,477

890

24,252

1,347

846

398

2,591

(119)

(20)

(154)

(293)

19,039

1,074

5,303

1,134

26,550

7,138

Depreciation At 1 April 2010

3,251

773

2,564

550

Charge for the year

334

351

139

854

Eliminated on disposals

(70)

(14)

(128)

(212)

3,515

803

2,901

561

7,780

15,524

271

2,402

573

18,770

14,560

301

1,913

340

17,114

Freehold property

Leasehold property

Furniture, fittings and equipment

Motor vehicles

Total

£’000

17,811

1,074

3,913

795

23,593

Additions

1,347

422

168

1,937

Disposals

(119)

(154)

(273)

19,039

1,074

4,335

809

25,257

3,251

773

2,381

482

6,887

334

326

119

809

At 31 March 2011 Net book values At 31 March 2011 At 31 March 2010

The Association

Cost At 1 April 2010

At 31 March 2011 Depreciation At 1 April 2010 Charge for the year Eliminated on disposals

(70)

(128)

(198)

3,515

803

2,707

473

7,498

At 31 March 2011

15,524

271

1,628

336

17,759

At 31 March 2010

14,560

301

1,532

313

16,706

At 31 March 2011 Net book values

OUR FINANCES

Depreciation rates are as follows: Freehold property 2%–10% per annum (see note 3(e)) Leasehold property Over the period of the leases or useful economic life if shorter. Furniture, fittings and equipment including software 10%–33.3% per annum Motor vehicles 20% per annum

11. INVESTMENT IN SUBSIDIARY COMPANIES Cost

2011

2010

£’000

402

372

Cost of shares Balance at 1 April 2010 Additions Balance at 31 March 2011

402

Provision for diminution in value Balance at 1 April 2010 and 31 March 2011 Net investment in subsidiaries

(2)

400

The Association owns 100 per cent of the following unlisted companies: Country of incorporation

Issued share capital

Scout Shops Limited

England

£200,000

Scout Insurance Services Limited

England

£100,000

Scout Insurance (Guernsey) Limited

Guernsey

£100,000

Scout Services Limited

England

£100

Unity Insurance Services Limited (dormant)

England

£1

The Directors of Scout Shops Limited, Scout Services Limited and Scout Insurance Services Limited have agreed to donate their taxable profits to the Association. The Directors of Scout Insurance (Guernsey) Limited declared an interim dividend of £600,000 for the year ended 31 March 2011 (2010: £750,000) that was paid to the Association in August 2010. The summarised profit and loss accounts for the active trading subsidiary companies are shown below: Scout Insurance (Guernsey) Scout Services Limited Limited

Scout Shops Limited

Scout Insurance Services Limited

2011

2010

Total

£’000

Trading income

6,173

1,618

3,142

1,035

11,968

10,784

Cost of sales

2,917

(933)

(2,238)

(6,088)

(5,317)

Gross profit

3,256

685

904

1,035

5,880

5,467

Other income Other costs and expenses Surplus before and after taxation

352

448

822

(1,492)

(79)

(336)

(773)

(2,680)

(2,356)

2,116

700

568

264

3,648

3,933

(2,116)

(600)

(570)

(141)

(3,427)

(3,797)

Net surplus

100

(2)

123

221

136

Net gain on investments

Retained surplus

100

(2)

123

221

192

200

100

400

4,051

(4)

122

4,230

4,009

261

4,151

(4)

222

4,630

4,409

Dividend/donation to the Association

Shareholders’ funds Share capital Reserves

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12. FIXED ASSET INVESTMENTS Quoted investments

Consolidated

Market value at 1 April Less: Disposals at opening value Add: Acquisitions at cost Net gain on revaluation at 31 March

The Association

2011

2010

2011

2010

£’000

22,571

17,182

14,915

11,435

(19,836)

(7,359)

(90)

(1,613)

21,239

10,595

838

2,808

598

2,153

598

2,283

Market value at 31 March

24,572

22,571

16,261

14,913

Historical cost at 31 March

22,747

21,486

14,447

13,700

Included in quoted investments are amounts of £9,315,000 (2010: £8,574,000) and £6,420,000 (£6,179,000) invested in each of the Cazenove Growth Trust for Charities (UK Equities) and the Cazenove Income Trust for Charities (UK Bonds). This results in a portfolio asset ratio of 40 per cent equities, 29 per cent bonds and 31 per cent cash which is in line with the ratio range agreed by the Trustees in the investment strategy. The Association does not pay any investment management fees. The investments held are in investment trusts which themselves suffer management charge deductions from the capital of the trust. These indirect charges are estimated to be in the region of £69,000 (2010: £62,000).

13. STOCKS Consolidated

Goods for resale

The Association

2011

2010

2011

2010

£’000

607

440

136

201

14. DEBTORS Consolidated 2011

Trade debtors Amounts owed by subsidiaries

The Association

2010 As restated

2011

2010 As restated £’000

£’000

1,764

2,413

270

2,885

2,181

Other debtors

5,846

2,423

5,589

2,204

Debtors due within one year

7,610

4,836

8,557

4,655

Other debtors due between 2012 and 2020

736

859

736

859

8,346

5,695

9,293

5,514

Other debtors includes prepaid expenses and deposits amounting to £3,411,000 (2010: £501,000) relating to the World Scout Jamboree in Sweden in July 2011. Other debtors due between 2012 and 2020 includes £616,000 (2010: £399,000) loans to Scout Groups.

OUR FINANCES

15. CREDITORS Consolidated Amounts falling due within one year:

The Association

2011

2010

2011

2010

£’000

13,411

14,873

13,411

14,873

3,474

3,242

1,189

874

Deposits by Scout Groups in the Short Term Investment Service Trade creditors Amounts owed to subsidiaries Other creditors

11,847

7,149

7,441

2,580

28,732

25,264

22,069

18,352

1,485

1,337

Amounts falling due after more than one year: Insurance technical reserve Other creditors includes fees received in advance from participants in the World Scout Jamboree in Sweden in July 2011, amounting to £6,602,000 (2010: £858,000). The Insurance technical reserve is a provision made in the financial statements of Scout Insurance (Guernsey) Limited against future claims. Under the terms of Financial Reporting Standard 12 this amount should not be treated as a provision by a non-insurance entity. The Trustees consider that, in order to give a true and fair view, it is necessary for the Association to show this under long-term creditors following the view taken by the directors of Scout Insurance (Guernsey) Limited. If this treatment had not been adopted, income for the year would have increased by £148,000 (2010: decreased by £206,000) and reserves would have been increased by £1,485,000 (2010: £1,337,000).

16. FUND BALANCES (a) Unrestricted funds

Consolidated

The Association

2011

2010

2011

2010

£’000

General reserves

14,571

13,857

14,597

13,890

Designated

26,770

24,210

26,770

24,210

Non-charitable trading Unrestricted funds before pension reserve

4,230

4,009

45,571

42,076

41,367

38,100

Pension reserve

(3,252)

(6,930)

(3,252)

(6,930)

Unrestricted funds

42,319

35,146

38,115

31,170

(b) DESIGNATED FUNDS – CONSOLIDATED AND THE ASSOCIATION Transfer (to)/ Balance 1 April from general and Net (expenditure) Balance 31 March 2010 restricted funds in the year 2011 Intangible and tangible fixed assets World Scout Events

£’000

16,706

3,498

138

20,342

119

National Scout Activity Centres

4,394

(822)

3,572

Future Growth

1,966

(35)

1,931

Gilwell Buildings

149

Development Grants

876

(17)

(202)

657

24,210

3,481

(921)

26,770

Total

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The Intangible and Tangible Fixed Asset Fund is set aside to match the amount invested by the Association in intangible and tangible fixed assets as this is not available to be used for revenue expenditure. The World Scout Events Fund provides support to members attending World Scouting events such as future World Scout Jamborees, the World Moot and the World Scout Conference. The Trustees plan to fully utilise the fund in advance of the 22nd World Scout Jamboree in 2011. The National Activity Centres Fund was established from the receipts from the sale of certain sites, under the National Campsite Strategy. The fund is being applied towards improvements at the National Scout Activity Centres, other than Gilwell Park. The Future Growth Fund and Development Grants Fund are administered by the Development Grants Board and used to finance a variety of projects relating to the medium/long-term growth of Scouting. The Gilwell Buildings Fund is set aside to fund the development of Gilwell Park.

(c) Restricted funds – Consolidated & the Association Restricted funds include income received by and paid from the Short Term Investment Service and 32 (2009: 25) funds administered by the Association. Balance 1 April 2010

Income

Expenditure

Transfers

£’000

Investment Balance revaluation 31 March 2011 £’000

£’000

Development Grants

514

(521)

King George VI Leadership

701

(11)

728

International

406

(47)

380

Gilwell Development

227

(1)

228

Benevolent

199

(2)

208

Cornwell

148

160

Ralph Reader Memorial

121

(29)

101

Special Needs

108

(52)

All other funds (25)

436

618

(462)

(34)

563

2,860

681

(1,125)

(33)

2,431

Consolidated

£34,000 capital expenditure was incurred on construction during the year and consequently that amount was transferred from restricted funds to the Fixed Asset Designated Fund. Further details on the types of funds and applying for grants from the funds can be found at www.scouts.org.uk/grants

(d) Endowment funds – Consolidated & the Association Endowment funds include the 1914 Endowment Fund and four (2010: four) other funds administered by the Association. Income from the 1914 Endowment Fund and two other funds is unrestricted and passed to General Funds, income from one fund is restricted, and income from the remaining fund is passed to an external Scouting beneficiary.

Fund

Balance 1 April 2010

Transfers

Investment revaluation

Balance 31 March 2011

£’000

1914 Endowment

871

907

All other funds

189

195

Consolidated

1,060

1,102

OUR FINANCES

(e) Analysis of net assets between funds Unrestricted Fund balances at 31 March 2011 are represented by: Intangible fixed assets

Restricted Funds Endowment Funds

Total

£’000

138

Tangible fixed assets

21,215

Investments

21,515

1,955

1,102

24,572

Current assets Current liabilities

19,509

13,887

33,396

(15,321)

(13,411)

(28,732)

Long term liabilities

(1,485)

Pension liability

(3,252)

42,319

2,431

1,102

45,852

17. OTHER FINANCIAL COMMITMENTS Scout Insurance Services Limited has the following annual commitments under non-cancellable operating leases: 2011

2010

£’000

Expiring: Between two and five years

18. ACQUISITIONS On 31 March 2011, the lease of Great Tower Scout Activity Centre reverted to The Scout Association from the tenant West Lancashire County Scout Council for an agreed sum. At that date the net assets of Great Tower Activity Centre were as follows: £’000 Land and buildings Equipment Goodwill arising on acquisition

655 48 138

Net assets acquired Fair value

841

The Scout Association did not take over operation of the Centre until 1 April 2011. Therefore the acquired and continuing operations have not been separated out in the Statement of Financial Activities.

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Independent auditor’s report We have audited the financial statements of The Scout Association for the year ended 31 March 2011 which comprise the Group Statement of Financial Activities, the Group and Parent Charity Balance Sheets, the Group Cash Flow Statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the charity’s trustees, as a body, in accordance with 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 Trustees and auditor As explained more fully in the Trustee Responsibilities Statement (set out on page 18), the Trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. We have been appointed as auditors under section 43 of the Charities Act 1993 and report in accordance with this 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 (APB’s) Ethical Standards for Auditors.

Scope of the audit of the financial statements A description of the scope of an audit of financial statements is provided on the APB’s website at www.frc.org.uk/apb/scope/private.cfm.

Opinion on financial statements In our opinion the financial statements: • give a true and fair view of the state of the group’s and the parent charity’s affairs as at 31 March 2011 and of the group’s incoming resources and application of resources for the year then ended • have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice • have been prepared in accordance with the requirements of the Charities Act 1993.

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’ Annual Report is inconsistent in any material respect with the financial statements; or • sufficient accounting records have not been kept; or • the parent charity 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.

BDO LLP Statutory Auditor, Epsom, United Kingdom 13 July 2011 BDO LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006. BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

OUR MEMBERS

: 3 r e t Chap S ER B OUR MEM

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Census results for the year ended 31 March 2011

Youth Membership Beaver Scouts

2011

2010

Male

Female

Total

97,404

14,654

112,058

108,018

124,809

19,487

144,296

142,904

Scouts

96,605

21,857

118,462

117,328

Explorer Scouts

26,293

10,053

36,346

34,689

1,391

670

2,061

2,171

346,502

66,721

413,223

405,110

Cub Scouts

Scout Network members Total Youth Membership Leadership Section Leaders

29,338

24,027

53,365

51,714

Sectional Assistants and Skills Instructors

7,767

6,303

14,070

14,455

Group Scout Leaders

4,243

1,643

5,886

5,684

District Skills Instructors and Advisors

655

172

827

860

District Scouters

620

366

986

931

1,550

763

2,313

2,389

County Skills Instructors and Advisors

501

106

607

626

County Scouters

228

135

363

377

County Commissioners

452

168

620

644

45,354

33,683

79,037

77,680

District Administrators

736

766

1,502

1,313

District Office Bearers

District Commissioners

Total leadership Organisational Support

1,190

665

1,855

1,846

County Administrators

122

116

238

245

County Office Bearers

200

254

268

Active Support/Scout Fellowship

4,236

3,251

7,487

7,872

Individual Members and Associate Members

3,060

2,290

5,350

5,555

Total organisational support

9,544

7,142

16,686

17,099

Total Membership

401,400

107,546

508,946

499,889

Members

400,332

106,615

506,947

497,681

878

884

1,762

2,208

507,206

498,331

Associate Members

Total Membership due to pay the Headquarters Membership Subscription ie the Total Membership above less the District and County Administrator totals Statistical Information Young Leaders

6,329

2,701

9,030

9,640

Scout Network members (recorded elsewhere)

1,937

887

2,824

2,961

Total Network members

3,328

1,557

4,885

5,132

Beaver Scout Colonies

7,122

6,975

Cub Scout Packs

7,900

7,791

Scout Troops

6,850

6,815

Explorer Scout Units

2,344

2,291

Local Scout Networks

332

322

Active Support Units/Scout Fellowships

703

737

Groups

7,344

7,247

Districts

770

802

Units

Counties/Areas/Regions

HOW WE OPERATE

: 4 r e t Chap E OPERATE HOW W

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The Scout Association exists by authority of a Royal Charter, granted by King George V in 1912 and supplemented by further Charters granted by King George VI and Queen Elizabeth II. These charters give authority to the Bye Laws of the Association, which are approved by Her Majesty’s Privy Council. The Bye Laws, in turn, authorise the making of rules for the regulation of the Association’s affairs. The rules are laid out in the Policy, Organisation and Rules of The Scout Association. The report and accounts cover the activities directly controlled by The Scout Association Charity Numbers 306101 (England and Wales) and SCO38437 (Scotland). The activities of the Scout Councils of Northern Ireland, Scotland and Wales together with Scout Counties, Areas, Regions (Scotland), Districts and Groups are not reflected in this report and accounts. These bodies are autonomous charities affiliated to The Scout Association which together form the Scout Movement in the United Kingdom.

The Board of Trustees The management of the business of the Association is vested in the Board of Trustees. Following a review of The Scout Association’s national governance, the Council of The Scout Association adopted new Bye Laws in September 2008. These were approved by the Privy Council in April 2009. From September 2009 onwards, the Committee of the Council was restructured and renamed the Board of Trustees. The

transition arrangements to the new structure will be complete following the Annual General Meeting in 2011. The Board comprises up to 19 Members: nine Elected Members and three Elected Youth Representatives elected by the Council of The Scout Association at its Annual General Meeting; up to five Appointed Members, including a Chairman of the Board and a Treasurer; and two Ex-Officio Members (the Chief Executive and Chief Scout or a Deputy Chief Scout). An induction training programme is provided for all new trustees. The Board will appoint chairmen and members of sub-Committees annually. The Board is responsible for policy making and the management of risk. It delegates some operational decisions to its Executive and sub-Committees (Operations, Finance, General Purposes and Headquarters Appointments) which may also recommend policies for the consideration of the Board. A review of reporting committees was completed in 2010/11 and a revised committee structure will take effect from September 2011. The Board met four times during the period under review. The Executive and sub-Committees mostly met quarterly.

Risk management The Association has a comprehensive set of policies and rules applicable to the Movement, which are routinely monitored and reviewed by senior volunteers, senior management and by staff employed across the UK.

We are committed to providing the best possible experience for everyone in Scouting, whether they’re young people or adult volunteers. To help us achieve this, we work to a number of key policies, through which we can make sure that Scouting continues to develop in a way that is safe, accessible and free from discrimination. Our key policies are: • Religious policy • Equal opportunities policy • Child protection policy • Safety policy • Anti-bullying policy • Development policy The Association continues to identify, monitor, review and manage the major operational and business risks that we face on a regular basis. A comprehensive insurance policy exists to ensure that, where appropriate, insurable risks are covered. It is recognised that the nature of our work requires active acceptance and management of some risks in undertaking activities in order to achieve our objectives. Following the 2009/10 fundamental review of the Association’s risk management strategy and processes, a Risk Assurance Committee was established to more closely monitor the Association’s key risks. The Risk Assurance Committee is developing a risk dashboard, risk matrix and risk register and plans to facilitate a more structured and rigorous approach to monitoring risk management in the coming year.

HOW WE OPERATE

The Scout Association Board, Structure and Membership April 2010-March 2011 Founder Robert Baden-Powell, OM, First Baron Baden-Powell of Gilwell

Patron Her Majesty The Queen

President His Royal Highness The Duke of Kent, KG, GCMG, GCVO

Vice Presidents The Rt Hon. The Earl of Airlie, KT, GCVO, PC The Lord Baden-Powell John Beresford, CBE Peter Duncan Sir William Gladstone, 7th Baronet, KG, JP, DL Lt Col. Bill Hall, OBE, TD, DL Sir Garth Morrison, KT, CBE, Lord Lieutenant of East Lothian George Purdy, CBE Major General Michael Walsh, CB, CBE, DSO, DL

Chief Scout

The Board of Trustees Trustees (voting) Wayne Bulpitt, UK Chief Commissioner (100%) 1, 4, 5 John Capper, Treasurer [to September 2010] (100%) 1, 2, 7 Sally Cantello [from September 2010] (66%) 1, 2, 6 David Chapman (100%) 2 Sir Alan Craft, Chairman of Board of Trustees (100%) 1 Graham Haddock (100%) 1, 5 Richard Hames (75%) 2 Carl Hankinson [from September 2010] (100%) 5 Stuart Howells (100%) 1, 3, 6 Chris Ide, Treasurer [Treasurer from September 2010] (75%) 1, 2, 7 Stephen Lake [from September 2010] (100%) 5 Zena Martin (100%) 3 David Morton (100%) 2, 4 Peter Oliver (50%) 3 Philip Power [to September 2010] (100%) 4 Rachel Ruddock (100%) 4, 5 Roger Sands (100%) 3 Sonika Sidhu (25%) 5 Christopher Thompson (100%) 2 Melanie Thrush (100%) 3 Derek Twine, CBE, Chief Executive (100%) 1, 7 Daniel Wood [to September 2010] (100%) 1, 5

Bear Grylls Right of Attendance (non-voting) County, Area and Regional (Scotland) Commissioners Invited to Attend (non-voting) Gary Davis, Director of Finance 1, 2, 6, 7 Keren Mallinson, Director of Corporate Services 1, 3, 6 Stephen Peck, Director of Programme and Development 1, 5 Gail Scott-Spicer, Director of Marketing and Communications 1, 3 The Trustees above were also members of the following committees: 1= Executive Committee 2= Finance Committee 3= General Purposes Committee 4= Headquarters Appointments Committee 5= Operations Committee 6= Risk Assurance Committee 7= Audit Committee In addition, each of the committees, besides the Executive Committee, has non-Trustee members invited for their specialist skills. The percentages indicate the number of Board meetings attended.

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Our thanks The Association would like to thank all our volunteers and supporters for their commitment and contributions. Special thanks go to those mentioned here.

Corporate partners Chubb Cotswold Outdoor Environment Agency Fresh Produce Consortium Maritime and Coastguard Agency Merlin Entertainments Met Office Microsoft National Grid Natural England NatWest OMSCo Ordnance Survey Pets at Home Puffin Rolls-Royce Sainsbury’s Serco Environment Venture Abroad Walls WD-40 West Mercia Police Worcester Bosch Group

Ambassadors Tom Avery Baroness Betty Boothroyd Lord Sebastian Coe Chris Evans Richard Harpin Ian Hislop Justin King Dawud Wharnsby Jo Whiley

Trusts and foundations JP Morgan The Freemasons’ Grand Charity The Milly Apthorp Charitable Trust The Souter Charitable Trust The Wates Foundation The Peter Cruddas Foundation Esmée Fairbairn Foundation The Jack Petchey Foundation RSA Homeworkers 3000 Sea Scout Admiralty Fund The Worshipful Company of Shipwrights Trinity House

The Garfield Weston Foundation The 29th May 1961 Charitable Trust The Tanner Trust The Swire Charitable Trust R Clarke and G Buxton Charitable Trust The Privy Purse Charitable Trust

Individuals Geoffrey Granter Tom Johnson Richard Harpin

UK Scout Fellows The Very Rev’d Christopher Armstrong Dean of Blackburn Frank Armstrong Sir Nicholas Bacon Bt OBE DL Tony Baldry MP Dr Tony Butler Patrick James Custis CBE Ven Dr Mark Dalby Peter Day Mr and Mrs A Dickson Sir Peter Dixon Richard Everard DL LLD (Hon) Berkeley M Ferro Lord Mark Fitzalan Howard OBE Dr John Furniss Christopher Hancock QC Tony Harvey FCIP FCMI FRSA Lt Col Brian Hilton Andrew Laing Sir Bert Massie CBE John Naylor OBE Harry Morton Neal CBE Mrs Mary Prior MBE, HM Lord Lieutenant of Bristol Arthur Puckrin LLB (Hons); London Barrister; FCIS MBIM Anthony Smith John Hilary Smith Sir John Sunderland Dennis Tapper Julian Thould H Richard Walduck OBE KStJ JP DL Edward Watts John Winder JP FCA Our anonymous Fellows

How you can support us As an individual From volunteering one hour a week at your local Scout Group to becoming a Scouting Fellow or leaving us a gift in your will, whatever you choose to give, it will make a difference.

As a company Scouting provides flexible opportunities not only for individuals but also for our corporate partners. From sponsoring a badge or event to using our employee volunteering programme, speak to our Marketing team.

How we can support you As a volunteer you will develop skills, make friends and make a difference to the lives of hundreds of young people in your community. As a company you will benefit from working with one of the most trusted organisations in the UK, increased brand awareness and commercial benefits.