Item 8 - Sheffield Health and Social Care

A provision of £729,000 relates to Injury Benefits. These are payable to current and former members of staffwho have suffered injury at work. These cases have been adjudicated by the NHS Pensions Authority. Thevalue shown is the value of payments due to the individuals for the term indicated by Government Actuary lifeexpectancy tables, and the actual value of this figure represents the main uncertainty in the amounts shown. (31March 2012 – £438,000).Previously £314,000 of provisions in 2011/12 were covered by ‘back-to-back’ income arrangements withSheffield Primary Care Trust. Due to the demise of Primary Care Trusts as at 31st March 2013, Sheffield PrimaryCare Trust cleared their outstanding liability with the FT during 2012/13. Therefore, there areno back to back arrangements with effect from1st April 2013.£3,585,000 is included in the provisions of the NHS Litigation Authority at 31 March 2013 in respect of clinicalnegligence liabilities of Sheffield Health and Social Care NHS Foundation Trust (31 March 2012 – £1,743,000).19. Contingent liabilities31 March2013£00031 March2012£000Legal claims (66) (58)Redundancy (412)(478) (58)Legal claims contingent liabilities represent the consequences of losing all current third party legal claimcases. Redundancy contingent liabilities represent potential redundancies where there may be an outflowof resources embodying future economic benefits in settlement of: a) a present obligation; or b) a possibleobligation whose existence will be confirmed only by the occurrence or non-occurrence of one or moreuncertain future events not wholly within the control of the Trust.20. Financial instrumentsIFRS 7, ‘Financial Instruments: Disclosures’, requiresdisclosure of the role that financial instrumentshave had during the period in creating or changingthe risks a body faces in undertaking its activities.Because of the continuing service providerrelationship that the Trust has with primary caretrusts and the way those primary care trusts arefinanced, the Trust is not exposed to the degreeof financial risk faced by business entities. Alsofinancial instruments play a much more limited rolein creating or changing risk than would be typicalof listed companies, to which the internationalfinancial reporting standards mainly apply. The Trusthas limited powers to borrow or invest surplus fundsand financial assets and liabilities are generatedby day-to-day operational activities rather thanbeing held to change the risks facing the Trust inundertaking its activities.The Trust’s treasury management operations arecarried out by the finance department within theparameters defined formally within the Trust’sStanding Financial Instructions and policiesagreed by the Board of Directors. Trust treasuryactivity is subject to review by the Trust’s internalauditors.Currency riskThe Trust is principally a domestic organisationwith the great majority of transactions, assets andliabilities being in the UK and sterling based. TheTrust has no overseas operations. The Trust thereforehas low exposure to currency rate fluctuations.Interest rate riskThe Trust has low exposure to interest rate fluctuationsas it has no borrowings and any excess funds areinvested on a short term basis with low risk institutions.Credit riskAs the majority of the Trust’s income comes fromcontracts with public sector bodies, the Trust haslow exposure to credit risk. The maximum exposureas at 31 March 2013 are in receivables fromcustomers, as disclosed in the receivables note.20.1 Financial assets31 March2013£00031 March2012£000Denominated in £ Sterling – Floating interest rate* 22,664 16,963*This excludes cash in hand of £67,000 (2011/12 £65,000)Liquidity riskThe Trust’s net operating costs are incurred underannual service agreements with local Primary CareTrusts and Local Authorities, which are financedfrom resources voted annually by Parliament. TheTrust finance its capital expenditure from fundsobtained within its prudential borrowing limit.The Trust is therefore not exposed to significantliquidity risks.The financial assets which have a floating rate of interest are cash held at the Government BankingService and cash held with commercial banks. This cash is held on short term deposit. All other financialassets, including non-current assets, are non interest bearing. The Trust has no financial assets with fixedinterest rates.20.2 Financial liabilitiesThe Trust has no financial liabilities with floating or fixed rates of interest. They are all non interest bearing.20.3 Financial assets by category31 March2013£00031 March2012£000Loans and receivablesNHS receivables 1,666 1,643Other receivables with related parties 4,284 2,604Provision for irrecoverable debts (18) (18)Accrued income 11 1,368Other receivables 247 305Cash at bank and in hand 22,731 17,02828,921 22,930185186