The Society’s budget aims to fund its events, grants and publications from its income. The Society’s financial position has been monitored regularly by the Council and in discussions with representatives of Investec Wealth and Investment, our investment advisers. Dividend income from investments within the financial year amounts to £15,238 (2014: £14,912), a return of 3.8% against 3.56% in the previous year. The market value of the Society’s investments this year has fallen by 3.5%. We have withdrawn £10,000 from our liquid reserves in the Charities Deposit Fund in order to pay grants. The overall general unrestricted funding base of the Society has reduced by 3% to £423,912. This includes cash held by the Charities Deposit Fund and Investec at the year end of £47,477 (2014: £53,464). Council has noted that over the past ten years expenditure has exceeded income most years. This is unsustainable in the longer term. The increase in the annual subscription is the first step in addressing the deficits.
The Society’s reserves comprise an unrestricted fund derived from past benefactions and its annual subscriptions, including the proceeds from the sale of the Philosophical Hall to Leeds City Council in 1921. The fund increased in value over the years as income exceeded expenditure and the value of investments increased. Since the Society adopted its new constitution in 1997, Council’s aim in the medium term has been to balance its expenditure and income without depleting the capital value of its investments. The Society’s income and expenditure do, however, vary from year to year depending on a number of factors. The Council therefore considers it prudent to hold liquid reserves in the Charities Deposit Fund and current bank account. The policy on reserves is reviewed annually by the Council as part of its annual budget review.
There are no restrictions in the Society’s Memorandum and Articles on the Society’s power to invest. The Council’s investment objectives are to maintain a level of income sufficient to fund the Society’s activities, while maintaining the capital value of its invested assets over the long term in line with inflation. To this end, it is the Society’s normal practice to reinvest realised gains on its assets. The Council has delegated the management of its investments on a discretionary basis to Investec Wealth and Investment.
1) Income: The investment managers pursue an active investment policy on the Society’s behalf. The arrangements are regularly reviewed by the Trustees.
2) Expenditure: Expenditure on individual Grants, Publications and Events usually represents a small part of total expenditure and risks are minimised by standard procedures for authorisation of all financial transactions. The potential risks at the Society’s events are considered as part of the planning for them, and appropriate steps are taken, including the arrangement of Public Liability insurance as necessary.
3) The quality of the Society’s Events and Publications and the outcome of Grants that have been awarded are reviewed by the Trustees at their regular meetings so as to ensure that all the Society’s activities are of a high standard consonant with its Aims.
The Society has taken advantage of the small companies’ exemption in preparing this Directors’ Report.
Approved by the members of the Council on 12 November 2015 and signed on their behalf by J M Hill (President)