TRUSTEES' REPORT AND ACCOUNTS 2024
60
the SORP with a cost price of above £5,000 is capitalised as such.
Costs in respect of the research phase of a project are expensed
as they arise. Costs in respect of the development phase of a
project are capitalised when there are adequate technical and
financial resources to complete and it is probable that future
economic benefits will arise. Development projects are amortised,
on a straight-line basis, when available for use, over their useful
economic life of between three and 10 years. Intangibles are
currently made up of trademarks and software, which are
amortised on a straight-line basis over their useful life. They
are included as intangible fixed assets.
l) Investments
Stocks and shares are measured at bid value at the balance
sheet date. Included in investments is portfolio cash held within
the investment portfolios, which fluctuates with purchases
and disposals of investment holdings. Stocks and shares are
measured at bid value (which equates to market value) at the
balance sheet date.
Donated and legacy investment properties consist of land where
development approval is being sought or the property is being held
in anticipation of increased value and are held at their estimated
fair value at the balance sheet date. Unrealised gains and losses
arising on the revaluation of investments are, together with the
realised gains and losses arising on the sales of investments,
shown in the consolidated statement of financial activities as
net gains/(losses) on investments.
m) Stocks
Stocks are stated at the lower of cost and the net realisable value.
Provision is made for slow-moving or obsolete items.
n) Fund accounting
Endowment, restricted and unrestricted funds are disclosed
separately in the financial statements. Endowment and restricted
funds are subject to specific restrictions imposed by the donor or
by the nature of the appeal or grant. Where the donor restrictions
are for revenue purposes for activities normally carried out within
the General Fund, expenditure is allocated to the restricted funds
to offset the costs as they are incurred. Further details are given
in Note 17.
Designated funds are part of the General Fund set aside for a
specific purpose by the Board. Details of designated funds are
set out in Note 20.
o) Pension costs
For the defined benefit section of the pension scheme, the
interest cost and the expected return on assets are shown net of
other finance costs or credits adjacent to interest.
Actuarial gains and losses are recognised immediately in other
recognised gains and losses. The defined benefit pension section
is funded, with the assets of the scheme held separately from those
of the group in a separate trustee administered fund. Pension
scheme assets are measured at fair value and liabilities are
measured on an actuarial basis using the projected unit credit
method and discounted at a rate equivalent to the current rate of
return on a high-quality corporate bond of equivalent currency and
term to the scheme liabilities. The actuarial valuation is obtained
at least triennially and is updated at each balance sheet date.
The resulting pension scheme asset or liability is presented
separately after other net assets on the face of the balance sheet.
Key assumptions that have been used to estimate the pension
scheme liability include a discount rate of 4.6%; RPI inflation
of 2.90% and CPI inflation of 2.60%.
p) Taxation
As a charity, the RSPCA benefits from various exemptions from
taxation afforded by tax legislation and is not liable to corporation
tax on income or gains falling within those exemptions. Recovery
is made of tax deducted from income and from receipts under
Gift Aid, and partial recovery is also made of tax credits on UK
dividend income. The RSPCA is also able to partially recover Value
Added Tax. Expenditure subject to VAT that is not recoverable by
the RSPCA is recorded in the accounts inclusive of the VAT.
The RSPCA is a charity within the meaning of Para 1 Schedule 6
Finance Act 2010. Accordingly, the RSPCA is potentially exempt
from taxation in respect of income or capital gains within
categories covered by Chapter 3 of Part 11 of the Corporation Tax
Act 2010 or Section 256 of the Taxation of Chargeable Gains Act
1992, to the extent that such income or gains are applied exclusively
to charitable purposes.
RTL makes a qualifying donation of taxable profit to the RSPCA
to the full extent allowable. Unless material, any corporation tax
liability arising in RTL is included within the resources expended
by the group.
q) Provisions
Provisions are provided for in the accounts when a liability is
likely to occur in the future based on a past event and it is able
to be estimated.
r) Assets held as a custodian
The charity holds a number of assets as a custodian on behalf
of branches; these are not included in the balance sheet of
the charity.
Notes to the accounts continued
YEAR ENDED 31 DECEMBER 2024