Annual Report and Financial Statements 2010/11 - Hanover

Cash flow
The net cash outflow in 2011 was £1.8m (2010:
£1.2m). The net cash inflow from operating activities
of £29.4m (2010: £31.2m) decreased slightly year on
year due to working capital movements and changes
to provisions mostly netting off the increase in
operating surplus. Note 26 to the financial statements
contains the detailed cash flow disclosures.
Accounting policies
The Group’s accounting policies are set out in note 1
to the financial statements.
Statement of compliance
In preparing this operating and financial review, the Board
has followed the principles set out in Part 3 of the SORP
‘Accounting by Registered Social Landlords (Update 2008)’.
Fixed assets
Details of fixed assets are shown in notes 10 and 11
of the financial statements.
Housing properties are included on the balance sheet at
a net book value (gross historical cost less depreciation,
Social Housing Grant and other public grants) of
£271m (2010: £264m). The Board believes that the
current market value of these properties is significantly
in excess of their net book value. This belief is based
on rolling valuations of large elements of the portfolio,
coupled with the Group’s planned maintenance
programme based on stock condition surveys. The Group
maintains its properties to a high standard and the
Board does not believe that any of its existing properties
have suffered from any impairment during the year.
Post balance sheet events
The Board has no post balance sheet events to report.
Going concern
After completing a financial business plan and making
enquiries, the directors of the Group have a reasonable
expectation that the Group has adequate resources to
continue in operational existence for the foreseeable
future. For this reason the going concern basis has
been adopted in these financial statements.
Group highlights – five year summary
For the year ended 31 March 2011
2010
2009
2008
2007
£m
£m
£m
£m
£m
Group income and expenditure account
Total turnover 89.6 93.0 85.4 80.7 70.9
Operating surplus 25.4 17.6 6.7 11.4 11.8
Interest payable 11.2 11.9 11.3 10.4 10.0
Surplus/(deficit) after interest and tax 16.5 9.1 (5.3) 4.3 3.0
Group balance sheet
Tangible fixed assets, net of depreciation 599.2 576.0 552.5 528.9 476.1
SHG and other capital grants 314.4 299.3 290.1 270.7 251.3
Net current assets/(liabilities) 10.3 (7.7) 3.9 (4.1) 11.7
Net debt 211.1 195.7 203.0 186.7 154.0
Total reserves 74.5 50.5 53.5 63.6 55.0
Statistics
Operating margin 28.4% 18.9% 7.9% 14.1% 16.6%
Surplus/(deficit) for the year as % of turnover 18.4% 9.8% (6.2%) 5.3% 4.3%
Gearing (net debt as % of reserves plus
grants plus housing depreciation)
47% 46% 50% 49% 44%
Accommodation managed at the year end Dwellings Dwellings Dwellings Dwellings Dwellings
Total housing stock owned 17,643 17,549 17,631 16,908 15,977
Total housing stock managed 18,823 18,756 18,761 18,947 18,156
PAGE 18 • HANOVER HOUSING ASSOCIATION AND ITS SUBSIDIARIES