Email: production@redcross.org.uk Tel: 020 7877 7029

British Red CrossUK Office44 MoorfieldsLondon EC2Y 9AL

Tel: 020 7877 7284Fax: 020 7562 2000redcross.org.uk

Published 2013

The British Red Cross Society, incorporated by Royal Charter 1908, is a charity registered in England and Wales (220949) and Scotland (SC037738).

Thanks also to: AstraZeneca Bloomberg Dr E Boyd and Miss J A Boyd BT The Cargill Trust Mrs Henrietta Cayzer City of London Corporation Clifford Chance LLP Mr Terry Cross of Delta Print and Packaging Deloitte Hilary Douglas, President of Surrey Eucalyptus Charitable Foundation Gatwick Airport Community Trust Mrs Dorothy Gower John James Bristol Foundation LifeScan Scotland Lloyd’s Charities Trust Lotus Foundation Mr John Maclean Melbreak Charitable Trust News International Group Limited The Dowager Countess Eleanor Peel Trust The Sir James Reckitt Charity River Island Royal Bank of Scotland Group Scouloudi Foundation Summerfield Charitable Trust Tesco The Tula Trust Mr Boyd Tunnock CBE Wales Council for Voluntary Action The Wolfson Foundation Zochonis Charitable Trust

Patron Her Majesty The Queen

President His Royal Highness The Prince of Wales KG KT GCB OM

Deputy presidents Her Royal Highness Princess Alexandra The Hon Lady Ogilvy LG GCVO The Countess Mountbatten of Burma CBE CD JP DL

Honorary vice-presidents Lord Barnard TD The Rt Hon Baroness Chalker of Wallasey Sylvia, Countess of Limerick CBE Professor John McClure OBE Mrs Elspeth Thomas CBE DL

Vice-presidents Mr Anthony Andrews Ms Angela Rippon OBE Mrs Maria Shammas MBE

Board of trustees Mr James M. T. Cochrane, chair (until 31 December 2012) Sir Charles Allen CBE, chair (from 1 January 2013) Mrs Victoria Peterkin, vice-chair (until 31 December 2012) Mr David Fall CMG, vice-chair Mrs Stella Cummings, vice-chair Mr David Howell, treasurer Mrs Susan Brown (until 31 December 2012) Mrs Hilary Douglas CB (from 1 January 2013) Mr Stanley Fitches MBE (until 31 December 2012) Ms Amy Foan Mr Michael Herriot MBE Mrs Uzo Iwobi Mr Steve John Lady Angela Lamport Dr Lise Llewellyn Mr Gordon Low Mrs Gill Moffat (from 1 January 2013) Dr. Daniel Sedgewick (from 1 January 2013) Mr Keith Shipman Mr Graham Stegmann CBE (until 31 December 2012) Mr Paul Taylor

Board sub-committees include: Finance and audit committee Remuneration committee Nominations committee

Senior management team Sir Nicholas Young, chief executive Michael Adamson, managing director of operations Roger Smith FCIPD, director of people and learning Mark Astarita, director of fundraising Philip Talbot, director of communications Rohan Hewavisenti ACA, director of finance and business development Caroline Leighton, chef de cabinet David Peppiatt, director of international Margaret Lally, director of UK service development Norman McKinley, UK director, Scotland, Northern Ireland and the Isle of Man Territory Jean Henderson, UK director, Northern Territory Annie Bibbings, UK director, Wales and Western Territory Liz Page, UK director, South Eastern Territory

External auditors BDO LLP 2 City Place Beehive Ring Road Gatwick West Sussex RH6 0PA

Bankers National Westminster Bank plc City of London Office PO Box 12258 1 Princes Street London EC2R 8PA

External legal advisers Withers Old Bailey London EC4M 7EG

Investment managers BlackRock 33 King William Street London EC4R 9AS

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Contents

Chair and chief executive’s statement 4

Our aims 6

Emergency response and recovery 8

Building resilience: first aid and humanitarian action 10

Health and social care 12

Supporting the Movement 14

Our plans for 2013 16

Review of finances 18

Structure and governance 20

Independent auditors’ report to the trustees of the British Red Cross 22

Accounts for the year ended 31 December 2012 26

Thank you 46

4

2012 has been a memorable year, both for the UK and for the British Red Cross. Our volunteers helped with the Diamond Jubilee celebrations and contributed to the success of the Olympics and Paralympics, demonstrating their hard work and dedication as they provided first aid support throughout.

The sheer numbers of people descending on London and the surrounding areas put great pressure on statutory services. Our teams were unstinting in their support, proving their value by treating hundreds of people throughout the busy summer.

However, it has also been a year of sadness for the Red Cross. In April, we lost our well-respected and dear colleague, Khalil Dale, who was found dead four months after being abducted in Pakistan. Khalil was part of the Red Cross and Red Crescent family for 30 years and we felt his loss deeply. Over the years, he worked for the Red Cross in many countries around the world, from Kenya and Sudan to Afghanistan and Iraq. He never shied away from tough assignments and was a brave, committed and kind man. We continue to miss him.

It reminded us of the dangers that dedicated Red Cross and Red Crescent staff and volunteers around the world face on a daily basis, and we are grateful to them for their courage and determination to ensure we reach people in crisis, whoever and wherever they are.

Last year, once again, many crises around the world claimed our attention and our support. As conflict continued to devastate lives in Syria, we supported our colleagues in the Syrian Arab Red Crescent and the International Committee of the Red Cross, as they crossed front lines to provide vital relief. We also demonstrated that we are not just there for the short-term as we entered our third year of support in Haiti following the earthquake in 2010.

As part of the International Red Cross and Red Crescent Movement, we are committed to supporting other Red Cross and Red Crescent Societies around the world. In his role as chair of the global panel of secretary-generals on building capacity in other National Societies, our chief executive saw how support from larger Societies like the British Red Cross can be vital in enabling smaller ones to respond to disasters in their own communities. Last year, we provided support to Red Cross and Red Crescent societies in 43 countries, including Liberia, Bangladesh and Mongolia.

In the UK, extreme weather conditions once again threatened our communities. Our volunteers responded to floods up and down the country, evacuating hundreds of people from their homes and giving them somewhere safe and dry to rest. And we helped vulnerable people prepare for the freezing winter conditions, in many cases preventing illnesses or accidents that would have led to a stay in hospital.

2012 was also the year we felt it was time to speak up more clearly about the important work we do in the UK. We know that many people still think of the British Red Cross as an organisation providing overseas aid and they know less about our life-saving work at home. In September, we launched a powerful national TV advertising campaign – refusing to ignore people in crisis. The campaign showed how crises can come in many forms and how our support helps people cope with and recover from them. It was well received, reaching millions of adults around the country, and leading to a 31 per cent increase in online requests for our services.

Last year marked the halfway point of our five-year strategy, Saving Lives, Changing Lives. A midterm strategy review showed we have made significant progress against our objectives despite unforeseen changes in the external environment including the prolonged economic downturn and wide programme of

Chair and chief executive’s statementSir Charles Allen CBE Chair of the board of trustees

Sir Nicholas Young Chief executive

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government reforms. In particular, we have reached around two million people in the UK with our services and three million around the world and have seen significant growth in our international work. We have brought together our UK operations into a single directorate. We are also pleased to report that our unrestricted fundraising income continues to grow, despite the difficult economic climate. Overall income was down because, thankfully, there were fewer major disasters last year than in 2011.

Improving our ability to deliver the best possible results for the people we support is central to ensuring that we are achieving our mission. We are building on our current measurement practice to make sure it helps us to improve continuously. In 2013, we will focus on improving practice across the UK and internationally to increase the effectiveness of our programmes and services.

And as always, we remain committed to ensuring that we spend our money as efficiently as possible. Last year, we conducted reviews across our services, streamlining processes and ensuring that we spend as effectively and efficiently as possible. We rely on the generosity of many kind donors and supporters, and we ensure that the resources they provide are used most effectively.

In December, we said farewell to James Cochrane, who stepped down as our chair after six years. James, who was recently appointed a CBE, has been a huge asset to the Red Cross and we thank him for his extremely valuable contribution. Sir Charles Allen CBE joined us as chair in January 2013 and is delighted to take on the leadership of our board of trustees.

Last year was a year of great achievements for the British Red Cross, none of which would have been possible without the support and dedication of our supporters, volunteers and staff. Thank you to everyone who helped us improve the lives of so many people around the world and who we hope will continue to help us in the years to come.

Sir Charles Allen CBE Chair of the board of trustees

Sir Nicholas Young Chief executive

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Our aimsOur vision is of a world where everyone gets the help they need in a crisis.

Our mission is to mobilise the power of humanity so that individuals and communities can prepare for, deal with and recover from a crisis.

As the UK’s leading emergency response charity, 3,600 staff and 29,800 volunteers pursue these goals both here and overseas. Our work includes emergency response, health and social care, and building resilience (including first aid and humanitarian education). We operate both in our own right, and as part of the International Red Cross and Red Crescent Movement, the world’s largest humanitarian network, which has more than 13 million volunteers across 188 countries. Our corporate strategy, Saving Lives, Changing Lives, sets the framework for our core activities between 2010-15.

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Our plans for 2012 included:

> ensuring we were fully prepared to meet the potential emergency response challenges presented by a year of major activity in the UK, including the Olympics, Paralympics and Queen’s Diamond Jubilee

> growing investment in international disaster response and increasing the reach and impact of resilience programming with International Red Cross and Red Crescent Movement partners, particularly in Africa and South Asia

> teaching first aid to 354,000 young people and adults, so they are more able, confident and willing to help someone in a crisis

> strengthening the quality of our services for refugees and asylum seekers by achieving Office of the Immigration Services Commissioner (OISC) accreditation for the majority of our services and seeking institutional funding to meet some of the needs arising from the significant budget cuts of partners in the refugee sector

> continuing to develop our health and social care services so we are on course to reach 40 per cent more beneficiaries by the end of 2014 with a choice of services that increase their ability to live independently for longer

> strengthening our ability to measure the outcomes and impact of our work in the UK and internationally.

We met the key elements of our plans for 2012 and further details are provided in the following pages.

3,600 staff

29,800 volunteers

13 million Red Cross Movement volunteers

188 countries

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We helped more than 500,000 people around the world last year when their lives were hit by disasters including famine, floods, conflict and earthquakes.

The International Red Cross and Red Crescent Movement is one of the only agencies working across front lines in Syria, where millions of people have been displaced from their homes or have fled the country as the conflict worsens. As temperatures plummeted during the country’s inhospitable winter, we sent in aid convoys carrying much-needed supplies of emergency bedding, tarpaulins and electric heaters to people living in abandoned buildings and tents. Throughout the year, we provided food and other relief to alleviate the distress of thousands of Syrians who have fled over the border to seek refuge in neighbouring Jordan and Turkey.

We helped hundreds of thousands of people facing severe food shortages in West Africa with the launch of our West Africa Food Crisis Appeal. Red Cross teams distributed food rations, livestock support, seeds and tools to vulnerable people in countries across the region including Mali, Burkina Faso and Senegal. Our support has ensured that many families can feed themselves during this crisis and helped build their resilience to cope with future disasters.

Emergency response and recoveryWe respond to hundreds of disasters every year. From floods to earthquakes, we’re among the first to arrive, and we stay long after the crisis is over.

“ “Habi, 80, after receiving a Red Cross food parcel in Mali, West Africa

We’re all so thankful to receive this food because we have no cereal stocks left and the food in the market is so expensive

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When Hurricane Sandy hit Caribbean shores and news headlines in October, we provided hygiene parcels, buckets and cleaning kits to thousands of people in Jamaica and Cuba to help them recover as quickly as possible.

And years after the earthquake in Haiti in 2010, we continue to help people whose lives were devastated by the disaster. Last year, we began the second phase of our recovery work, providing materials and support for communities to rebuild vital infrastructure, and helping families regain their livelihoods and independence. We have worked with the community to plan the reconstruction of safe housing, ready to start construction in 2013.

When Tropical Storm Isaac threatened further damage to the island in August, the Red Cross helped Haitians prepare, evacuating people to emergency shelters, preparing hygiene and first aid kits, and sending out text message warnings.

In the UK, 2012 was a jam-packed year full of major events including the Queen’s Diamond Jubilee and the Olympic and Paralympic Games. Red Cross volunteers stepped up to the challenge, providing first aid support at major transport hubs and helping almost 1,000 people

during the Olympics fortnight alone. From teenagers toppling over in the heat to windsurfing injuries, our dedicated volunteers were on hand to help, with teams based across London and further afield.

Extreme weather conditions, fires, possible explosions and a gas leak also brought out Red Cross volunteers in their droves. Our emergency response volunteers responded to 2,500 call-outs in the UK in 2012 (56 in Scotland) including many incidents of serious flooding.

When Comrie in Perthshire suffered flooding in November, volunteers offered support at a rest centre to residents evacuated from local houses and two care homes. And in St Asaph, north Wales, a pregnant woman and a 92-year-old man were among many people rescued from their flood-hit homes by Red Cross volunteers in November.

Our refugee services team were busy last year working towards Level 1 accreditation from the Office of the Immigration Services Commissioner (OISC) – ensuring the quality of their work is officially recognised. During 2012, London, Bristol, Newcastle and Manchester/Liverpool achieved OISC Level 1 accreditation, which means that ten of our 17 operational Areas are now accredited. The remaining Areas are well on their way.

“ “John Cheetham (70), who was evacuated to a rest centre in St Asaph, north Wales, during November’s flood

It was a very traumatic experience. What will stick in my mind is the support that I received from the staff and Red Cross volunteers at the rest centre. Being able to talk through my worries made the world of difference and relieved some of the anxiety and tension

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Teaching people life-saving first aid skills is essential to developing community resilience. In 2012, we trained 417,000 people in first aid, including 37,000 in Scotland.

We used a host of new technologies to reach young people with our training. In July, we teamed up with Facebook to host an interactive party with real-life and online guests. Those taking part online could influence the live action by voting on what happened next. When one guest appeared to collapse, the others were asked to decide how to save her life. Live footage from the event appeared in a new DVD resource for teachers.

We also harnessed the popularity of YouTube to help us deliver first aid messages to young people. Online sensation Dan Howell, whose videos have been seen 55 million times, worked with us to develop a Christmas-themed film about choking, featuring key first aid messages, which was viewed 1.2 million times.

We believe first aid is a vital skill that every child and young person should learn. That is why we lobbied MPs last year to support a parliamentary petition for first aid and humanitarian education to be a core part of the national curriculum, and will continue with this campaign in 2013.

Our first aid mobile app, (redcross.org.uk/app) providing advice on everyday first aid scenarios, such as burns and seizures, continues to be popular and was downloaded 281,000 times

in 2012. And recognising that first aid is of particular concern to parents, we relaunched the section of our website dedicated to first aid for children and babies. From allergic reactions and broken bones, to meningitis and poisoning, it covers all the first aid skills parents need to know to keep their children and babies safe.

We also provided tailored first aid training to many at-risk groups including homeless people in Lancashire, Merseyside and Greater Manchester, and Polish families with disabled children in Southampton. We know that some groups are more likely to experience injuries, accidents or illnesses than others so we focussed our efforts on improving their capacity to deal with the difficult or dangerous health situations they may find themselves in. We hope this will ensure that many lives will be saved in the future.

Our research has shown that even when people have learned first aid, they still sometimes lack the confidence to step forward in an emergency. To address this, we have improved our first aid courses,

developing a new resource pack to help our trainers boost learners’ confidence and increase their willingness to act. This new approach will be rolled out across the country in 2013.

Elsewhere in the world, we helped communities in Uganda, Nepal, Pakistan and the Caribbean build their resilience and prepare for disasters such as earthquakes, hurricanes, flooding and outbreaks of disease.

Building resilience: first aid and humanitarian actionWe help people prepare for emergencies and build resilient communities.

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Brigitte Bellwood, Amersham, who stepped forward to help save the life of a man who collapsed at Luton Airport

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When I saw people shouting for help, there was no way I was going to stand by and do nothing. The man wasn’t breathing and his pulse was starting to fade. Fortunately, my Red Cross first aid course had drummed home all the key messages

“ “Dmitry, who is helped by the Kazakhstan Red Crescent HIV and TB programme, supported by the British Red Cross

When I got HIV and TB, I found it really tough to live in this world. I felt like an outcast. The attitude of the people at the Red Crescent makes a huge difference. They’ve helped me survive

In Nepal’s Kathmandu valley we helped raise awareness of the risks of earthquakes and how to reduce vulnerability to disasters among millions of people. We also provided first aid training to first responders and search and rescue teams. In Uganda, we worked with communities to reduce the risk of flooding and prepare for the health risks associated with it, such as malaria.

Improving community resilience is at the core of all our disaster recovery work overseas. As we continue to help people cope during and in the aftermath of disasters in Haiti and Syria, we also provide the necessary support to enable them to withstand future disasters and conflicts.

We continue to work with Red Cross and Red Crescent National Societies in countries around the world to help tackle some of the most basic health and social care needs in vulnerable communities where there is little access to health services.

For example, we sent a team out to Sierra Leone to help combat a dangerous cholera outbreak that killed more than 180 people and threatened the lives of thousands more. Our team provided safe water, cholera kits and promoted good hygiene practices to prevent further spread of the disease.

We continue to support the Kazakhstan Red Crescent in providing advice and comfort to those living with TB and HIV, educating people about the diseases and how they are spread, and reducing the stigma surrounding them.

And in Kwa Zulu Natal in South Africa, 37,000 adults living with HIV and 27,000 orphaned and vulnerable children have received care and support through our HIV programme, in its first five years. A further two million people were reached with HIV prevention messages.

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*The strategy baseline was calculated by taking an average of the actual number of people helped by the care in the home service in 2010 and the number we planned to reach in 2011.12

In this current economic climate, when health budgets are under enormous pressure, our health and social care services are more vital than ever. We support vulnerable people to live independently in their own homes, preventing further hospital admissions.

As cuts to statutory social care put elderly and vulnerable people at risk, our home-based care services are improving people’s lives as well as saving the NHS thousands of pounds in longer-term health costs. A report by Deloitte, published in December 2012, showed that the Red Cross’ 100-plus preventative support schemes across the UK represent £8 million in savings for the NHS and social care providers each year.

In 2012, we helped thousands of vulnerable people across the UK cope in their own homes following a health crisis. From loaning vital medical equipment to providing support when they returned home from hospital, our volunteers were there to help people retain their independence.

We helped more than 57,000 people cope in their own homes following a hospital stay, including 3,000 in Scotland. We provided support with shopping, paperwork and finances, as well as helping people access social networks and see friends. By the end

of 2012, we had grown the number of people helped by our care in the home service by 38 per cent against the strategy baseline*. With plans for attracting more contracts this year, we are confident of meeting, or even exceeding, our 40 per cent growth target by the end of 2013.

Our medical equipment made it possible for 172,000 people to remain independent (7,000 in Scotland), while local teams assisted people needing transport to essential medical appointments, providing over 120,000 journeys (44,000 in Scotland).

During the cold winter months, Red Cross volunteers in many areas helped older people take care of themselves during the freezing weather conditions, and prevented many admissions to hospital accident and emergency departments.

We continue to look for innovative and efficient ways to provide vital care to people during a health crisis. For example, in Shropshire, we launched a new service offering support for people living with dementia and their carers who find themselves in a crisis situation due to the carer’s ill health or exhaustion. It is this type of service that can provide the lifeline that many carers and patients need during a crisis.

Health and social careWe help vulnerable people and communities cope with health and social care crises, and live independently in their own homes.

““Patricia Howe, 74, Woking, who received help when she returned home from hospital after a bout of pneumonia

The day my volunteer arrived, my life changed completely. She was there when I felt very low and ill, and looked after me. Now I am walking about and starting to enjoy my life again. Without her guidance and help, I don’t think I’d be at home today

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Justine Hillier, medical matron at St Peter’s Hospital in Surrey

There’s no doubt we’re now getting people out of hospital and back into their own homes more speedily and safely. The Red Cross’ support plugs gaps we hadn’t previously been able to fill – such as helping with social support, shopping and all those things

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Supporting the Movement

We contribute to strengthening the Red Cross Movement, with a focus on building core capacity of Movement members.

The British Red Cross remains committed to the vision of a strong, coherent and well-coordinated International Red Cross and Red Crescent Movement. We believe strengthening the Movement’s organisational effectiveness will enable the entire Movement to improve the delivery of its humanitarian mission to support the most vulnerable.

Throughout 2012, we continued to play an active role in supporting the Movement at a global level and investing in key initiatives, including National Society capacity building, National Society and Federation resource mobilisation, humanitarian policy and international humanitarian law (IHL).

Support to the Federation Secretariat in 2012 ranged from engagement in resilience, Movement policy, international disaster response laws and support to a number of key Federation posts. Specific programmes with National Society partners are included under our resilience work.

The International Red Cross and Red Crescent Movement is made up of the International Committee of the Red Cross (ICRC), the International Federation of Red Cross and Red Crescent Societies and 188 National Societies.

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We work on building capacity with all National Society partners. One example of this is the 8NS Africa initiative which matches four African National Societies with four northern National Societies to develop the capacity of the former. In 2012, the British Red Cross launched a core cost model with the 8NS which the African National Societies are using to understand their costs and support local resource mobilisation.

The International Division also manages the Partnership Framework Agreement (PFA) with the International Committee of the Red Cross (ICRC). In 2012 key areas of work included an operational partnership in Azerbaijan, significant HR and financial support, as well as on-going engagement on international law, tracing, and Movement policy.

A key part of the Movement support delivered in the UK is our work on international humanitarian law and humanitarian policy.

The British Red Cross is recognised as a leading National Society in international humanitarian law, and as a reliable and expert partner to the government and the UK armed forces. In 2012, we held our biennial summer school on international humanitarian law, attended by 49 delegates from nine countries, including representatives of four sister National Societies and the ICRC. We’ve also supported the development of an international humanitarian law database, a project run from Cambridge together with the ICRC. The database is a unique online resource, providing up-to-date information on law practice for use by specialists as well as members of the public worldwide.

The British Red Cross also manages the relationship between the Department for International Development (DFID) and the rest of the Movement, including £6 million support to the International Federation of the Red Cross and Red Crescent Societies, £1 million to the British Red Cross and a number of different grants to National Societies.

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Our plans for 2013In 2013 we have committed to:

1. Continue to grow our short term crisis response services such as fire and emergency support, event first aid and our work with refugees to ensure that individuals get a cost effective, high quality response from us which is based on their needs rather than where they live.

2. Support strengthening disaster management capacity of the International Federation and National Societies in Africa and South Asia, focussing particularly on improving organisational preparedness, capacity to increase community resilience, and building our own teams of response and early recovery specialists deployed internationally.

3. Equip 400,000 young people and adults with first aid skills, so they are more able, confident and willing to help someone in a crisis. We will put life-saving tools in people’s pockets through the promotion and launch of different versions of our first aid mobile app.

4. Advocate on our three priorities: securing inclusion of first aid on the national curriculum and encouraging more schools to teach first aid; driving changes in the asylum system to reduce destitution of people receiving refugee status, and promoting the continued need for legal support for refugees seeking to be re-united with their families; and winning policy support at a national and local level for the importance of low level preventative health and social care to allow people to live with dignity and independence where possible in their own home.

5. Grow our integrated health and social care offer so that we support 65,000 people to live independently in their own homes. This is in line with our target to reach 40 per cent more people each year by 2014 compared to 2011.

6. Continue our journey towards measuring and understanding the impact of our work in the UK and internationally so that we can respond better to the changing needs of people affected by crisis. This approach will be fundamental to the development of our strategic direction beyond 2015.

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Despite another challenging year for the UK economy we are pleased to report 4 per cent growth in our unrestricted income to a record £169.3 million (2011: £163.2 million). This income growth has helped support further investment in our charitable activities and our unrestricted charitable spend increased 7 per cent to £108.4 million (2011: £101.5 million).

We did not witness the same scale of international emergencies in 2012 compared to previous years and this has led to a reduction in our appeal income and expenditure. The Japanese tsunami appeal in 2011 alone resulted in income and expenditure of over £14 million in that year. As a result our restricted income decreased to £30.8 million (2011: £50.6 million), with a similar fall in restricted expenditure to £29.5 million (2011: £58.6 million).

The reduced scale of international emergency appeals has led to an overall 6 per cent reduction in our total income to £200.1 million (2011: £213.8 million) and an 11 per cent reduction in our total expenditure to £204.8 million (2011: £230.9 million).

Expenditure We spent £137.6 million on our charitable activities in 2012 (2011: £159.2 million). While overall spend decreased due to the aforementioned reduction in the amounts raised through international emergency appeals, we increased our expenditure across UK emergency response, resilience, health and social care and supporting the Red Cross Movement.

Our emergency response work in the UK includes refugee services, first aid at events and ambulance support as well as

core emergency response work. We increased our expenditure in the year on our UK emergency response by 10 per cent to £26.9 million (£24.5 million).

Expenditure on resilience comprised mainly of first aid training in the UK and overseas programmes run with National Society partners. This spend has increased 6 per cent in the year to £41.3 million (2011: £39 million), primarily due to continued growth in our international work with National Societies.

Our health and social care work is primarily UK-based. Our expenditure on this activity increased 9 per cent to £44.9 million (2011: £41.3 million). This growth was driven by an increase of £1.2 million on medical equipment services to £13.9 million due to increased activity on our principal contract.

We continue in our efforts to ensure that we are achieving value for money. The focus is on improving efficiency and effectiveness in our activities while controlling costs, and at the same time growing or maintaining activity levels. During 2012, we generated annual savings of £1.5 million by improving our contracts and procurement processes, with significant savings coming from utilities, medical equipment and print supplies.

Fundraising Our unrestricted voluntary income, primarily regular giving, legacies and other donations, has increased 4 per cent to £97.7 million (2011: £93.8 million). Our individual supporters donated more than ever before, through continuing challenging times, with income from regular giving increasing 8 per cent to £45.2 million

Review of finances

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(2011: £41.9 million). Overall voluntary income has decreased due to the reduction in restricted emergency appeal income.

Charitable income Around 44 per cent of our charitable expenditure in 2012 was funded from income directly from our charitable activities, up from 33 per cent in 2011. This income includes first aid training fees, health and social care contracts and grants to support our international work. Our charitable income increased 14 per cent to £60.1 million (2011: £52.9 million) with the biggest increase coming from growth in activity on our principal community equipment contract.

Reserves Our reserves policy is set to ensure that there is no disruption of British Red Cross services in the event of an unforeseen reduction in income or increase in expenditure.

Our reserves policy sets our minimum free reserves level at £15 million. As at 31 December, our free available reserves amounted to £38.1 million (2011: £41.4 million). Our strategy Saving Lives, Changing Lives outlines plans to draw down on our free available reserves further through 2013 and 2014 while remaining above our minimum reserves level. We plan to draw down at least £11 million in 2013 and a further £3 million in 2014.

Pensions We have two defined benefit pension schemes, which are both closed to new members. The reported net pension surplus reported on an FRS 17 basis is £0.5 million as at 31 December 2012 (2011: £0.7 million) and the actuarial loss during the year

was £0.7 million (2011: £1.6 million loss). However, our latest actuarial valuations for funding purposes showed a net deficit of £4.3 million. A deficit reduction plan is in place for one of the schemes.

We also have contingent liabilities in relation to the membership of the Pension Trust’s Growth Plan. The British Red Cross is solely responsible for the organisation’s membership of the scheme, which has an estimated £7.6 million exit charge at the year-end. A new deficit reduction plan is in place, with payments starting in 2013. We also have joint liability with the Order of St John for the pension liabilities of the Joint Committee of the Order of St John of Jerusalem and British Red Cross Society. This liability became payable in January 2013 when the Joint Committee withdrew from the scheme. British Red Cross’ share of the liability is estimated at £0.6 million.

Investments As at 31 December 2012, we held fixed asset investments of £35.1 million (2011: £49.1 million). Our investments reported net gains of £1.4 million in 2012.

An investment sub-committee of the finance and audit committee regularly reviews our investment portfolio and performs an annual review of our investment policy. Our investment objective is to seek yield subject to a requirement of capital preservation. The investment sub-committee is satisfied with the overall performance of the investment portfolio against agreed benchmarks. The British Red Cross will not directly invest in companies with a significant interest in trading in and manufacture of arms or in the manufacture of tobacco products.

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Structure and governance

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Legal status The British Red Cross was founded in 1870 and incorporated by Royal Charter in 1908. A supplemental Royal Charter took effect on 1 January 1998 and this was revised by HM The Queen in Council on 17 July 2003. The governing instruments under which the British Red Cross operates comprise this revised charter, the standing orders and other policies agreed from time to time by its governing body, the board of trustees.

The legal objects of the British Red Cross, as laid out in its revised Royal Charter, are to provide assistance to victims of armed conflicts and to work for the improvement of health, the prevention of disease and the prevention and alleviation of human suffering in the UK and throughout the world.

Organisation The board of trustees comprises nine elected members and up to eight members co-opted by the board itself.

Their terms of office last for three years, and they can serve two consecutive three-year terms, after which they must stand down from the board for at least one year. A nominations group is convened to oversee trustee recruitment. The recruitment for elected trustees is conducted via a national electoral college of eight volunteer council chairs. The board of trustees ratifies the election result. This is part of the board’s commitment to ensuring that its governance arrangements are effective and relevant, as well as ensuring that its diversity reflects the breadth of the services we provide and the communities in which we operate. When recruiting co-opted trustees, the nomination group is responsible for nominating new trustees to the board.

All new trustees are provided with a structured induction programme. Trustees participated in a range of development activities during the year. From visits to British Red Cross Areas, services and events, to external conferences, the Red Cross ensures that its trustees are kept abreast of developments in the sector as well as given the opportunity to broaden their skills and experiences to help them fulfil their duties effectively.

The approval of policy is a matter for the board. Appropriate reporting mechanisms and controls are in place to support decision making. Day to day management of the charity is delegated to the chief executive, who reports to the board of trustees, and the senior management team, which is charged with the implementation of policy.

A wholly owned trading subsidiary, Britcross Limited, supports the fundraising activities of the British Red Cross. The assets, liabilities and trading results of this company, which is incorporated in the UK, are consolidated into the financial statements. The British Red Cross has eight Overseas Branches in British Overseas Territories. These are included in the financial statements.

The British Red Cross is a prominent member of the International Red Cross and Red Crescent Movement, with volunteers and staff contributing to a number of initiatives within both the International Federation of Red Cross and Red Crescent Societies, the International Committee of the Red Cross (ICRC) and 188 member Red Cross and Red Crescent Societies.

The British Red Cross is also a member of the Disasters Emergency Committee, an umbrella organisation for 14 humanitarian agencies that unites aid efforts in times of disaster in poorer countries around the world.

Structure and governance

21

Volunteers carry out a wide range of activities including responding to emergencies, first aid, delivering health and social care and humanitarian education programmes, supporting refugees and asylum seekers, and fundraising. Without them, we could not carry out this life-saving and life-changing work.

Outcomes and impact Improving the outcomes (short to medium-term changes in the lives of beneficiaries) and impact (longer-term changes) of our work is crucial to our success. We are capturing a growing amount of evidence about this at operational level. In order to improve systematic approaches to quality, impact and outcomes across our operations, we have been developing comprehensive frameworks such as the UK services outcomes framework and the international management methodology. We are also working to ensure this is part of a coherent corporate approach to quality and accountability.

Cutting carbon emissions During 2012, we took our first steps in renewable energy by installing solar panels on three properties. In the six months following installation they have saved 19 tonnes of carbon.

Risk management Achievement of our aims and objectives entails taking risks. The trustees are satisfied that appropriate internal control systems and risk management processes are in place. They consider that the following framework provides the British Red Cross with adequate measures to reduce the impact of identified risks:

> The finance and audit committee reviews risk and internal controls, approves the annual risk-based internal audit plan, and receives internal audit reports, regular progress reports and risk updates.

> Senior management reviews key strategic and operational risks on a regular basis. They consider progress on mitigating actions, new and emerging risks, and opportunities.

> Board sub-committees and management groups help identify, evaluate and manage risks relating to fundraising, investments, business continuity, health and safety, remuneration, major infrastructure and IT projects, and operational needs including health and social care and emergency response.

The most significant risks to the British Red Cross include the impact of government policy, income generation, reputation,

security, health and safety of staff and volunteers, safety of beneficiaries, operational management information, IT infrastructure, workforce capacity and challenges of operating major relief programmes.

Trustees’ responsibilities The trustees prepare consolidated financial statements for each financial year. These give a true and fair view of the state of the British Red Cross and of the annual results. In preparing the financial statements, the trustees have:

> selected suitable accounting policies and applied them consistently

> made judgements and estimates that are reasonable and prudent

> followed applicable accounting standards without any material departures

> prepared the accounts on a going concern basis.

Financial statements are published on the organisation’s website (redcross.org.uk) in accordance with legislation in the UK governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The trustees’ responsibilities also extend to the ongoing integrity of the financial statements.

Public benefit The board of trustees has given regard to the legislative and regulatory requirements for disclosing how its charitable objectives (as set out in our Royal Charter) have provided benefit to the public. The board of trustees has complied with the duty set out in section 17 of the Charities Act 2011, and that set out by the Office of the Scottish Charity Regulator in the Charities and Trustee Investment (Scotland) Act 2005. This report outlines how our achievements during 2012 have benefited the public, either directly or indirectly.

On behalf of the trustees

Sir Charles Allen CBE Chair of the board of trustees 21 March 2013

Independent auditors’ report to the trustees of the British Red Cross

22

We have audited the financial statements of the British Red Cross Society for the year ended 31 December 2012 which comprise the Consolidated Statement of Financial Activities, the Consolidated Balance Sheet, the Consolidated 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 2011 and the Charities and Trustee Investment (Scotland) Act 2005. 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 Trustees’ Responsibilities Statement, 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 auditor under section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and under section 144 of the Charities Act 2011 and report in accordance with regulations made under those Acts. 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.

BDO LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.

23

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 December 2012 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; and

> have been prepared in accordance with the Charities Act 2011, the Charities and Trustee Investment (Scotland) Act 2005 and regulations 6 and 8 of the Charities Accounts (Scotland) Regulations 2006 (as amended).

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 2011 and the Charities Accounts (Scotland) Regulations 2006 (as amended) 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

> proper and sufficient accounting records have not been kept; or

> the parent charitable company’s financial statements are not in agreement with the accounting records or returns; or

> we have not received all the information and explanations we require for our audit.

BDO LLP Statutory Auditor Gatwick, United Kingdom Date: 26 March 2013

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

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OUR EMERgENCY APPEAL RAISED £23 MILLION> we spent £5.2 Million on emergency aid > we’re spending £17.9 Million to help over 340,000 people recover

6,647 SCHOOL FEES PAID FOR DISPLACED CHILDREN FOR ONE SCHOOL yeaR

300 METRES OF CANAL REPAIRED

OVER

340,000PEOPLE REACHED

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10,502 FAMILIES GIVEN CASH GRANTS TO HELP THEM GET BACK ON THEIR FEET AND DEVELOP INCOME GENERATING ACTIVITIES

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£5.4

MILLION£13.4

MILLION

IN 2012 WE SUPPORTED RED CROSS AND RED CRESCENT NATIONAL SOCIETIES AROUND THE WORLD

– cost of our services to health and social care commissioners

– what commissioners

would have spent on alternative services43

40 MILLION

ADULTS SAW OUR ADVERT

TV

500,000 TIMES ON

IT WAS VIEWED

YouTube

IMPACT OF OUR ADVERTISINg CAMPAIgN

HELPINg HAITI RECOVER HELPINg HAITI RECOVER HELPINg HAITI RECOVER

wHAT IS OUR CARE IN THE HOME SERVICE wORTH? wHAT IS OUR CARE IN THE HOME SERVICE wORTH?

25

AFGHANISTAN £52k

MALI AND NIGER £125k

SOUTH SUDAN £270k

UGANDA £29k

MOZAMBIQUE £50k

SENEGAL £59k

COMOROS £20k

SYRIA £150k

BURKINO FASO £59k

SOUTH ASIA £16k

LIBERIA £320k

HURRICANE SANDY £100k

DISASTER FUND DISTRIBUTIONS

2012

£320k

£125k

£60k

£30k

MYANMAR £300k

SIERRA LEONE £99k

FLOODS (South Asia/Uganda/Mozambique) £0.1m SYRIA CRISIS £0.2m LIBERIA RECOVERY £0.3m SAHEL FOOD CRISIS £0.1mAFRICA FLOODS (Mozambique/Comoros) £0.1m WEST AFRICA FOOD INSECURITY £0.1mAFGHANISTAN £0.1mSIERRA LEONE CHOLERA £0.1mSOUTH SUDAN £0.2mHURRICANE SANDY £0.1mSETTLEMENT 2004 TSUNAMI £0.1mMYANMAR CONFLICT £0.3mLESOTHO FOOD INSECURITY £0.1mJAMAICA (Hurricane Sandy) £0.1m

WE ARE IMPROVING OUR FIRST AID COURSES TO ENCOURAGE MORE PEOPLE TO STEP FORWARD BY gIVINg PEOPLE MORE INFORMATION AND SHOwINg THEM HOw THEY ARE EQUIPPED TO HELP, wE CAN INCREASE THEIR PROPENSITY TO ACT

AFTER COMPLETING ONE OF OUR COURSES,

66% OF PARTICIPANTS SAID THEY WOULD BE MORE WILLING TO HELP A STRANGER

79% WERE LESS WORRIED ABOUT DOING THE WRONG THING IN AN EMERGENCY SITUATION

JUST 7% OF THE UK POPULATION HAS BOTH THE SKILLS AND THE WILLINGNESS TO HELP IN A FIRST AID EMERGENCY

£8

MILLION70%

estimated

total savings to commissioners

of users rated our services as

excellent

4%

40%

10%

43%31%

INCREASE IN ONLINE SERVICE REQUESTS

FOLLOWING OUR ADVERTISING CAMPAIGN

EXPENDITURE INCREASE ON UK EMERGENCY RESPONSE

ACTIVITIES IN 2012

OF UK SECONDARY SCHOOLS USED A BRITISH RED CROSS EDUCATION

RESOURCE IN 2012

GROWTH IN UNRESTRICTED INCOME IN 2012

TARGET INCREASE IN PEOPLE HELPED BY

OUR CARE IN THE HOME SERVICE BY 2014

IMPACT OF OUR ADVERTISINg CAMPAIgN wILLINg TO ACT? wILLINg TO ACT? wILLINg TO ACT?

wHAT IS OUR CARE IN THE HOME SERVICE wORTH? wHAT IS OUR CARE IN THE HOME SERVICE wORTH?

SOURCE: DELOITTE REPORT, NOVEMBER 2012

26

Incoming resources from generated fundsVoluntary income 2 97.7 11.9 109.6 93.8 37.1 130.9

Trading activities 27.6 - 27.6 27.1 - 27.1

Investment income 0.4 - 0.4 0.3 - 0.3

Total incoming resources from generated funds 125.7 11.9 137.6 121.2 37.1 158.3

Incoming resources from charitable activitiesEmergency response and recovery 3.6 7.0 10.6 3.3 3.7 7.0

Resilience 14.0 2.1 16.1 14.7 0.8 15.5

Health and social care 23.2 1.0 24.2 21.0 0.6 21.6

Supporting the Movement 0.5 8.7 9.2 0.4 8.4 8.8

Total incoming resources from charitable activities 3 41.3 18.8 60.1 39.4 13.5 52.9

Other incoming resourcesMiscellaneous income 0.5 0.1 0.6 0.6 - 0.6

Net gains on disposal of tangible fixed assets 1.8 - 1.8 2.0 - 2.0

Total incoming resources 169.3 30.8 200.1 163.2 50.6 213.8

Costs of generating fundsVoluntary income 40.3 0.3 40.6 44.6 0.9 45.5

Trading activities 23.5 - 23.5 23.6 - 23.6

Investment management costs 0.1 - 0.1 - - -

Total resources expended on generating funds 63.9 0.3 64.2 68.2 0.9 69.1

Costs of charitable activitiesEmergency response and recovery 29.6 12.4 42.0 28.2 41.7 69.9

Resilience 33.4 7.9 41.3 31.6 7.4 39.0

Health and social care 43.2 1.7 44.9 39.7 1.6 41.3

Supporting the Movement 2.2 7.2 9.4 2.0 7.0 9.0

Total resources expended on charitable activities 108.4 29.2 137.6 101.5 57.7 159.2

governance costs 3.0 - 3.0 2.6 - 2.6

Total resources expended 4 175.3 29.5 204.8 172.3 58.6 230.9

Consolidated statement of financial activities for the year ended 31 December 2012

Incoming resources

Resources expended

Net (outgoing) / incoming resources before transfers (6.0) 1.3 (4.7) (9.1) (8.0) (17.1)

Transfers between funds 7 2.4 (2.4) - - - -

Net outgoing resources before recognised gains and losses (3.6) (1.1) (4.7) (9.1) (8.0) (17.1)

Losses on current asset investments - - - (0.3) - (0.3)

Gains / (losses) on fixed asset investments 9 1.1 0.3 1.4 (0.9) 0.3 (0.6)

Actuarial losses on defined benefit pension schemes 14 (0.7) - (0.7) (1.6) - (1.6)

Net movement in funds (3.2) (0.8) (4.0) (11.9) (7.7) (19.6)

Total funds at 1 January 7 98.5 37.7 136.2 110.4 45.4 155.8

Total funds at 31 December 7 95.3 36.9 132.2 98.5 37.7 136.2

2012 Restated Restated 2011 Unrestricted Restricted Total Unrestricted Restricted Total Notes £m £m £m £m £m £m

The 2011 unrestricted income comparatives in respect of ‘voluntary income’ and ‘trading activites’ have been restated to reflect a reclassification of £0.6 million

of gift aid on donated goods sold. All the activities relate to continuing operations.

Restated

27

Consolidated balance sheet as at 31 December 2012

Fixed assetsTangible fixed assets 8 64.2 64.4

Investments 9 35.1 49.1

99.3 113.5

Current assetsStocks 4.0 4.2

Debtors 10 30.0 30.9

Investments 9 11.8 6.6

Cash at bank and in hand 6.5 4.0

52.3 45.7

Current liabilitiesCreditors: amounts falling due within one year 11 (17.4) (20.0)

Net current assets 34.9 25.7

Total assets less current liabilities 134.2 139.2

Creditors: amounts falling due in more than one year (0.3) (0.3)

Provision for liabilities and charges 12 (2.2) (3.4)

Net assets before pension scheme surplus 131.7 135.5

Defined benefit pension scheme surplus 14 0.5 0.7

Net assets 7 132.2 136.2

2012 2011 Notes £m £m

The British Red Cross has not prepared a separate balance sheet for the charity as this is not considered to be materially different to the consolidated balance

sheet.

For and on behalf of the British Red Cross,

Sir Charles Allen David Howell Chair, board of trustees Chair, finance and audit committee

21 March 2013 21 March 2013

Funds:

Restricted funds 7 36.9 37.7

Unrestricted funds tangible fixed assets 56.7 56.4

Defined benefit pension scheme fund 0.5 0.7

Free available reserves 38.1 41.4

Unrestricted funds 7 95.3 98.5

Total funds 132.2 136.2

28

Net cash outflow from operating activities (see below) (3.3) (13.7)

Capital expenditure and financial investment 16 11.0 3.0

7.7 (10.7)

Increase / (decrease) in current asset investments (5.2) 4.3

Increase / (decrease) in cash 17 2.5 (6.4)

Reconciliation of net outgoing resources to net cash outflow from operating activitiesNet outgoing resources (4.7) (17.1)

Depreciation charge 6.4 6.7

Net gains on disposal of tangible fixed assets (1.8) (2.0)

Decrease / (increase) in stocks 0.2 (0.9)

Decrease / (increase) in debtors 0.9 (1.9)

(Decrease) / increase in creditors (2.6) 2.6

(Decrease) / increase in provisions for liabilities and charges (1.2) 0.1

Net charges for defined benefit pension scheme (0.5) (1.2)

Net cash outflow from operating activities (3.3) (13.7)

Reconciliation of net funds to movement in short-term funds less borrowingIncrease / (decrease) in cash 2.5 (6.4)

(Decrease) / increase in current asset investments 5.2 (4.3)

7.7 (10.7)

Losses on current asset investments - (0.3)

7.7 (11.0)

Net short-term funds less borrowing at 1 January 10.3 21.3

Net short-term funds less borrowing at 31 December 17 18.0 10.3

Consolidated cash flow statement for the year ended 31 December 2012

2012 2011 Notes £m £m

The accompanying notes form an integral part of these consolidated financial statements.

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1. Accounting policies

(a) Scope and basis of the financial statements The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of investments at market value, and are in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice (Revised 2005) (‘the SORP’), applicable accounting standards in the United Kingdom and the reporting requirements of the Charities Act 2011.

The results and balance sheet of the British Red Cross’ subsidiary, Britcross Limited, have been consolidated on a line by line basis. Britcross Limited makes up accounts to 31 December. Separate statements of financial activities and balance sheet have not been presented for the charity alone as these are not considered to be materially different from the consolidated statement of financial activities and consolidated balance sheet.

The financial statements incorporate the results of all material activities overseas where the British Red Cross has operational responsibility. The results and net assets of Red Cross operations in eight British Overseas Branches have been included in the financial statements.

(b) Fund accounting General unrestricted funds are available for use at the discretion of the trustees in furtherance of the general charitable objectives. A pension reserve is included within unrestricted funds to reflect the pension surplus.

Restricted funds are donated for either a particular area or purpose, the use of which is restricted to that area or purpose. Such donations are principally for international purposes.

(c) Incoming resources All income is accounted for when the British Red Cross has entitlement to the funds, the amount can be quantified and there is certainty of receipt. Where income is received in advance of providing goods and/or services, it is deferred until the British Red Cross becomes entitled to that income.

Unless there is evidence of uncertainty of receipt, residuary legacies are recognised from the date of probate where a reliable estimate of income can be made. Income from will or reversionary trusts is not recognised until the life interest has passed away. Income from pecuniary legacies is recognised upon notification.

Disasters Emergency Committee (DEC) appeal income is recognised to the extent that resources have been committed on programmes funded through the DEC appeals.

Gifts donated for resale are included as income when they are sold. Donated assets and services are included at the value to the British Red Cross where this can be reliably quantified. Donated services from our volunteers are not included within the financial statements.

Notes to the consolidated financial statements for the year ended 31 December 2012

31

1. Accounting policies (continued)

(d) Resources expended and basis of allocation of cost All expenditure is accounted for on an accruals basis.

Direct costs are those specifically related to producing the output of an activity, for example the costs incurred in direct contact with beneficiaries.

Support costs are those which provide indirect support to front-line output provision – examples are central finance, human resources and management information services. Support costs not attributable to a single activity have been allocated on a basis consistent with identified cost drivers for that cost category such as staff head count, floor space and expenditure.

Governance costs relate to the direct running of the charity, allowing the charity to operate and generate the information required for public accountability. They include the costs of subscriptions related to membership of the International Red Cross and Red Crescent Movement, as well as the costs of trustee meetings and internal and external audits.

(e) Tangible fixed assets and depreciation All tangible fixed assets costing more than £1,000 are capitalised and included at cost, including any incidental expenses of acquisition and irrecoverable VAT. Depreciation is provided on a straight-line basis over their useful economic lives as follows:

Freehold properties 50 yearsLeasehold properties- Shop premises the shorter of the term of

the lease and five years- Other premises the shorter of the term of

the lease and 50 yearsFreehold premises improvements

ten years

Leasehold premises improvements- Shop premises the shorter of the term of

the lease and five years- Other premises the shorter of the term of

the lease and ten yearsAmbulances seven yearsOther vehicles five yearsEquipment and furniture five yearsComputer equipment and software

between one and three years

Freehold land NilAssets in course of construction

Nil

32

1. Accounting policies (continued)

(f) Pensions The defined benefit pension scheme current service costs, together with the scheme interest cost less the expected return on the scheme assets for the year, are charged to the relevant expenditure heading within the consolidated statement of financial activities in line with the salary costs of the related employees. The defined benefit scheme assets are measured at fair value at the balance sheet date. Scheme liabilities are measured on an actuarial basis at the balance sheet date using the projected unit method and discounted at a rate equivalent to the current rate of return on a high-quality corporate bond of equivalent term to the scheme liabilities. The change in value of assets and liabilities arising from asset valuation, changes in benefits, actuarial assumptions, or change in the level of deficit attributable to members is recognised in the consolidated statement of financial activities within actuarial gains/losses on defined benefit pension schemes. The resulting defined benefit asset or liability is presented separately on the face of the balance sheet. The British Red Cross recognises assets for its defined benefit pension schemes to the extent that they are considered recoverable with reference to expected future current service costs for active scheme members.

Pension costs in respect of defined contribution schemes are charged to the consolidated statement of financial activities for the period in which they are payable.

(g) Investments Investments are stated at market value at the balance sheet date and the consolidated statement of financial activities shows net investment gains and losses arising from revaluation of the investment portfolio and disposals during the year.

(h) Stocks Stocks are stated at the lower of cost and net realisable value. Provision is made for obsolete, slow-moving or defective stock where appropriate. Items donated for resale and distribution are not included in the financial statements until they are sold or distributed. Emergency stocks held for disaster response

are transferred from stock to resources expended when issued from the warehouse.

(i) Value added tax Irrecoverable value added tax is allocated to the category of expenditure to which it relates.

(j) Provisions Provisions are recognised when the British Red Cross has a legal or constructive financial obligation, that can be reliably estimated and for which there is an expectation that payment will be made.

(k) Operating leases Rentals under operating leases are charged on a straight-line basis over the lease terms, even if the payments are not made on such a basis.

Benefits received and receivable as an incentive to sign an operating lease are, similarly, spread on a straight-line basis over the lease term, except where the period to the review date on which the rent is first expected to be adjusted to the prevailing market rate is shorter than the full lease term, in which case the shorter period is used.

(l) Foreign currencies The British Red Cross uses forward exchange contracts to hedge some of its known foreign exchange exposure. Transactions in foreign currencies are recorded at the rate of exchange prevailing at the date of the transaction, except where a forward contract is in place, in which case the rate specified in the contract is used.

Monetary assets and liabilities are translated into sterling at the exchange rate ruling on the balance sheet date, except where a forward contract is in place, in which case the relevant asset/liability is translated at the rate contained in the contract.

Foreign exchange gains are recognised as other income and foreign exchange losses are recognised in the consolidated statement of financial activities within the relevant charitable activity expenditure for the period in which they are incurred.

Notes to the consolidated financial statements for the year ended 31 December 2012

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2012 Restated Restated 2011 Unrestricted Restricted Total Unrestricted Restricted Total £m £m £m £m £m £m

2012 2011 grants Other Total grants Other Total £m £m £m £m £m £m

Regular giving 45.2 - 45.2 41.9 - 41.9

Public donations, appeals and fundraising 18.9 7.8 26.7 19.0 26.0 45.0

Service donations 2.4 0.1 2.5 2.4 0.1 2.5

Gift aid 11.9 0.3 12.2 11.7 1.8 13.5

Legacies 19.3 1.0 20.3 18.8 0.9 19.7

Disasters Emergency Committee appeals - 2.7 2.7 - 8.3 8.3

Total 97.7 11.9 109.6 93.8 37.1 130.9

2. Voluntary income

3. Incoming resources from charitable activities

Emergency response and recoveryUK 0.6 3.6 4.2 0.8 3.1 3.9

International 6.4 - 6.4 3.1 - 3.1

7.0 3.6 10.6 3.9 3.1 7.0

ResilienceUK 0.6 14.0 14.6 0.2 14.7 14.9

International 1.4 0.1 1.5 0.6 - 0.6

2.0 14.1 16.1 0.8 14.7 15.5

Health and social careMedical equipment services 1.2 8.3 9.5 0.3 6.6 6.9

Care and support programmes 3.2 11.5 14.7 3.5 11.2 14.7

4.4 19.8 24.2 3.8 17.8 21.6

Supporting the Movement 8.0 1.2 9.2 7.2 1.6 8.8

Total 21.4 38.7 60.1 15.7 37.2 52.9

Legacy income is not recognised until the British Red Cross has entitlement to the funds, the amount can be quantified and there is certainty of receipt. The estimated value of legacies, which have been notified, but not recognised at 31 December 2012 was £7.0 million (2011: £7.4 million) of which £6.0 million (2011: £6.4 million) are assets bequeathed to the British Red Cross, but subject to life tenancy.

Disasters Emergency Committee (DEC) appeal income is recognised to the extent that resources have been committed on programmes funded through the DEC appeals. Subject to our agreed allocation, the value of DEC appeal income not drawn down or accrued for at 31 December 2012 was £0.2 million (2011: £2.6 million).

Notes to the consolidated financial statements for the year ended 31 December 2012Restated

35

Direct Support 2012 2011 costs costs Total Total £m £m £m £m

4. Resources expended

3. Incoming resources from charitable activities (continued) Grant income includes grants from the UK Government's Department for International Development (DFID) totalling £14.9 million (2011: £10.2 million):

> 'Emergency response and recovery' international grants include £5.7 million from DFID for emergency response programmes in Sierra Leone, Syria, Turkey, Malawi, the Middle East and Cuba.

> 'Resilience' international grants include £1.2 million from DFID to support country programmes in Uganda, British Overseas Territories and Nepal.

> 'Supporting the Movement' grants includes £6 million (2011: £6 million) received as part the DFID Institutional Strategy Agreement grant to the International Federation of Red Cross and Red Crescent Societies (IFRC). 'Supporting the Movement' grants also include £2 million (2011: £1.2 million) as part of our DFID Programme Partnership Arrangement (PPA), which provides core funding for our international work to strengthen the International Red Cross and Red Crescent Movement’s capacity to provide emergency response and build resilience.

The charity vInspired has supported our National Citizen Service activities and our Social Action Fund opportunities. The income for 2012 is £97,000 (2011: £187,000).

The basis of allocation of support costs is described in note 1(d) and further analysis is provided in Note 5.

Our total resources expended includes irrecoverable VAT of £2.4 million (2011: £2.9 million).

Included under 2012 direct costs are grants to the International Federation of Red Cross and Red Crescent Societies (IFRC) and International Committee of the Red Cross (ICRC) of £15.4 million (2011: £20.1 million) and grants to other National Societies of £7.8 million (2011: £22.2 million).

Costs of generating fundsVoluntary income 39.2 1.4 40.6 45.5

Trading activities 22.6 0.9 23.5 23.6

Investment management costs 0.1 - 0.1 -

61.9 2.3 64.2 69.1

Charitable activities

Emergency response and recoveryUK 25.3 1.6 26.9 24.5

International 14.7 0.4 15.1 45.4

40.0 2.0 42.0 69.9

ResilienceUK 25.6 2.3 27.9 27.9

International 13.1 0.3 13.4 11.1

38.7 2.6 41.3 39.0

Health and social careMedical equipment services 13.0 0.9 13.9 12.7

Care and support programmes 28.0 3.0 31.0 28.6

41.0 3.9 44.9 41.3

Supporting the Movement 9.2 0.2 9.4 9.0

128.9 8.7 137.6 159.2

governance costsSubscriptions to Federation 2.0 - 2.0 1.9

Staff 0.6 - 0.6 0.3

Fees to auditors for audit of financial statements 0.1 - 0.1 0.1

Fees to auditors for other services - - - -

Other 0.2 0.1 0.3 0.3

2.9 0.1 3.0 2.6

-

Total 193.7 11.1 204.8 230.9

36

Cost of Emergency generating response and Health and Supporting 2012 2011 funds recovery Resillience social care the Movement governance Total Total £m £m £m £m £m £m £m £m

5. Support costs by activity

6. Trading subsiduary

The turnover and expenditure included within trading activities are:

The assets and liabilities of Britcross Limited consolidated within the balance sheet are:

Support costs have been allocated on the basis of the accounting policy set out in note 1 (d).

Britcross Limited, the British Red Cross’ wholly owned trading subsidiary incorporated in the United Kingdom, engages in the sale of cards and gifts as well as corporate sponsorship in aid of the British Red Cross.

Finance 0.9 0.5 0.6 0.5 0.1 - 2.6 2.6

Human resources 0.4 0.3 0.4 0.7 - - 1.8 1.7

Central facilities 0.3 0.4 0.5 0.9 - - 2.1 2.0

Management information services 0.6 0.7 1.0 1.7 0.1 0.1 4.2 3.6

Central management 0.1 0.1 0.1 0.1 - - 0.4 0.4

Total 2.3 2.0 2.6 3.9 0.2 0.1 11.1 10.3

Turnover 1.6 1.4

Expenditure (1.1) (0.9)

Net income donated to British Red Cross 0.5 0.5

Current assets 0.8 0.8

Current liabilities (0.8) (0.8)

Net assets - -

2012 2011 £m £m

Notes to the consolidated financial statements for the year ended 31 December 2012

37

Actuarial losses on Balance Net defined Balance 1 January investment benefit 31 December 2012 Income Expenditure gains pension Transfers 2012 £m £m £m £m £m £m £m

7. Funds

Restricted funds

Expenditure plans have been agreed for all material restricted funds. Funds are held in appropriate asset categories in accordance with planned usage. £1.6 million was transferred from restricted funds to unrestricted funds, due to the restriction on funds received being met when stock was purchased.

UK restricted funds UK restricted funds include:

> £6.1 million of properties and other tangible fixed assets held for restricted purposes

> a variety of local, national and European funding sources to deliver projects over the next 2-3 years

> legacies with a geographical and/or service restriction.

The balance of UK restricted funds is held for the provision of locally agreed services.

International restricted funds Significant programmes of work are planned for the disbursement of international restricted fund balances as at 31 December 2012. Other international restricted funds include:

> £2.3 million represented by net assets of the Overseas Branches

> £2.4 million for response to the East Africa food crisis

> £2.4 million for the second phase of our HIV and TB programme with the South African Red Cross

> £0.6 million deficit for the DFID Uganda Reducing Risk and Strengthening Support programme.

Disaster Fund The Disaster Fund allows us to prepare for and respond to humanitarian disasters abroad and in the UK. We fundraise specifically for the Disaster Fund and, as stated on emergency appeal materials, it can also contain funds donated to emergency appeals where we raise more than can be reasonably and efficiently spent on that specific response.

Total unrestricted funds 98.5 169.3 (175.3) 1.1 (0.7) 2.4 95.3

Total UK restricted funds 14.2 4.2 (5.4) 0.1 - (1.2) 11.9

Haiti earthquake 6.7 0.7 (2.8) - - - 4.6Syria and region - 5.0 (1.3) - - 0.2 3.9DFID Institutional Strategy with Federation - 6.0 (6.0) - - - -Other international restricted funds 12.7 13.9 (12.1) 0.2 - (2.6) 12.1

Total international restricted funds 19.4 25.6 (22.2) 0.2 - (2.4) 20.6

Disaster Fund 4.1 1.0 (1.9) - - 1.2 4.4

Total restricted funds 37.7 30.8 (29.5) 0.3 - (2.4) 36.9

Total funds 136.2 200.1 (204.8) 1.4 (0.7) - 132.2

38

CostAt 1 January 2012 48.0 33.8 43.9 2.1 127.8 Completions 1.0 0.2 0.8 (2.0) - Additions 1.1 1.8 2.4 0.9 6.2 Disposals (0.1) (0.1) - - (0.2)

At 31 December 2012 50.0 35.7 47.1 1.0 133.8

Accumulated depreciation

At 1 January 2012 14.7 12.5 36.2 - 63.4 Charge 1.4 1.5 3.5 - 6.4 Disposals (0.1) (0.1) - - (0.2)

At 31 December 2012 16.0 13.9 39.7 - 69.6

Net book value

At 31 December 2012 34.0 21.8 7.4 1.0 64.2

At 31 December 2011 33.3 21.3 7.7 2.1 64.4

Vehicles, Assets in the Freehold Leasehold equipment course of property property and furniture construction Total £m £m £m £m £m

8. Tangible fixed assets

Total£m

9. Investments

Market value at 1 January 2012 49.1Additions at cost 4.0Disposals at market value (19.4)Net investment gains in the year 1.4

Market value at 31 December 2012 35.1

Cost at 31 December 2012 33.3 Market value Per cent of Market value Per cent of 2012 2012 2011 2011 £m portfolio £m portfolio

The portfolio contains the following:

Fixed asset investments

UK equities 4.1 12% 7.8 16%

Overseas equities 3.4 10% 5.9 12%

UK fixed income 27.6 78% 35.4 72%

35.1 49.1

Number Market value Per cent of of units £m portfolio

The following investments represented more than 5 per cent of the value of the portfolio at 31 December 2012:

Lazard Thematic Global Institutional Share Class 36,579 3.4 10%

Legal & General CAF UK Equitrack 6,539,168 4.1 12%

Black Rock Ultra Short Bond Fund 222,506 27.6 78%

Notes to the consolidated financial statements for the year ended 31 December 2012

39

10. Debtors

12. Provisions for liabilities and charges

11. Creditors: amounts falling due within one year

Movements in deferred income during the year were as follows:

2012 2011 £m £m

Rehabilitation Leasehold commitments dilapidations Total £m £m £m

2012 2011 £m £m

2012 2011 £m £m

Current asset investments 2012 2011 £m £m

Royal Bank of Scotland Global Treasury Funds plc 7.5 6.2

Deposits 4.1 0.4

Investment property in the UK 0.2 -

Total 11.8 6.6

Trade debtors 5.7 4.6Accrued income 4.2 6.9

Other debtors 1.5 1.0

Prepayments 3.8 3.5

Tax recoverable 3.3 4.4

Legacies receivable 11.5 10.5

Total 30.0 30.9

All amounts shown under debtors fall due for payment within one year.

Trade creditors 2.3 3.3

Accruals 10.3 12.0

Other creditors 1.1 1.2

Deferred income 2.1 1.9

Taxes and social security costs 1.6 1.6

Total 17.4 20.0

Leasehold dilapidations relate to properties where the British Red Cross has a legal responsibility as tenant for such costs.

At 1 January 1.9 2.0

Income recognised during the year (1.9) (2.0)

Income deferred during the year 2.1 1.9

At 31 December 2.1 1.9

At 1 January 2012 1.1 2.3 3.4Payments during the year (1.1) (0.3) (1.4)Increase in provision - 0.2 0.2

At 31 December 2012 - 2.2 2.2

Amounts expected to be incurred:

- within one year - 1.1 1.1- beyond one year - 1.1 1.1

- 2.2 2.2

9. Investments (continued)

40

13. Staff emoluments and trustee expenses

2012 2011

£60,001 - £70,000 13 6

£70,001 - £80,000 3 6

£80,001 - £90,000 6 3

£90,001 - £100,000 6 5

£100,001 - £110,000 1 1

£110,001 - £120,000 1 2

£120,001 - £130,000 1 -

£180,001 - £190,000 - 1

£190,001 - £200,000 1 -

The number of employees whose emoluments, as defined for taxation purposes, (basic pay, vehicle and medical insurance benefits) amounted to over £60,000 in the year were as follows:

Five (2011: five) of the above employees have retirement benefits accruing to them under defined benefit pension schemes. The total cost of the contributions to these defined benefit schemes made by the British Red Cross for these employees was £124,000 (2011: £106,000).

Seventeen (2011: thirteen) of the above employees are members of a defined contribution scheme. The total cost of the contributions to this scheme made by the British Red Cross for these employees was £98,000 (2011: £81,000).

Total staff emoluments (including casual staff) for the first year were as follows: 2012 2011 £m £m

Salary costs 71.0 68.7

National insurance costs 6.0 5.9

Pensions costs 2.6 1.0

79.6 75.6

2012 2011

The average number of full-time equivalent staff employed by the British Red Cross during the year was as follows:

In the UKFundraising 190 171

Retail 551 547

UK services 1,483 1,475

First aid services 447 405

International services 78 72

Other 289 280

OverseasInternational services 71 65

Total employed by FTE 3,109 3,015

Total employed by headcount 3,624 3,547

Notes to the consolidated financial statements for the year ended 31 December 2012

41

Trustees’ expenses: 2012 2011 £000 £000

2012 2011

2012 2011

The average number of volunteers working for the British Red Cross during year was as follows:

Expenses incurred by trustees and reimbursed by the British Red Cross 22 15

Expenses incurred by the British Red Cross on behalf of trustees 24 26

Trustees’ indemnity insurance cover cost 15 14

Number of trustees receiving expenses 16 18

Trustees’ expenses are for travel and accommodation costs.

None of the trustees received any remuneration during the year (2011: £nil).

The decrease in volunteer numbers in 2012 is due to a review that was carried out to improve the accuracy of our records.

In the UKFundraising 3,247 3,813

Retail 6,605 6,456

UK services 12,033 13,571

First aid services 7,616 8,242

International services 276 418

Total 29,777 32,500

British Red Cross staff are entitled to join the British Red Cross Group Personal Pension Plan provided by Legal & General. Staff had previously been entitled to join the British Red Cross Pension Fund (“UK Office scheme”), Scottish Branch British Red Cross Society Retirement Benefits Scheme (“Scottish scheme”) or the Pensions Trust’s Growth Plan. These three schemes are all closed to new entrants.

UK Office and Scottish defined benefit pension schemes The assets of these pension schemes are held in separate trustee-administered funds. The schemes are subject to triennial valuations with the last full valuation being carried out as at 31 December 2010 for the UK Office scheme and 1 January 2012 for the Scottish scheme. These valuations were updated at 31 December 2011 and 2012 by independent actuaries on a Financial Reporting Standard 17 – Retirement Benefits (FRS 17) basis.

14. Pensions

The amounts charged to statement of financial activities are: UK Office Scottish 2012 2011 scheme scheme Total Total £m £m £m £m

Actual return less expected return on pension assets - 0.3 0.3 0.7

Experience losses on liabilities - - - (0.1)

Actuarial gain arising from government changes to statutory pension increases - 0.2 0.2 -

Other changes in assumption underlying the present value of scheme liabilities (1.6) (0.6) ( 2.2) (1.6)

Total actuarial loss (1.6) (0.1) (1.7) (1.0)

Movement in restriction of surplus 1.0 - 1.0 (0.6)

Net actuarial loss recognised (0.6) (0.1) (0.7) (1.6)

Current service cost 0.3 0.1 0.4 0.4

Interest cost on scheme liabilities 1.0 0.3 1.3 1.4

Expected return on plan assets (1.1) (0.3) (1.4) (1.8)

Net finance credit (0.1) - (0.1) (0.4)

The current service cost will increase as the members of the schemes approach retirement because the schemes are closed to new members.

The assumptions underlying the FRS 17 calculation in respect of the Scottish scheme are now linked to the Consumer Price Index. This change in assumption has resulted in a credit of £0.2 million, which has been recognised within the actuarial loss in the Statement of Financial Activities.

13. Staff emoluments and trustee expenses (continued)

42

14. Pensions (continued)

2012 2011 2012 2011

Equities 48% 44% 57% 57%

Bonds 51% 55% 42% 42%

Cash 1% 1% 1% 1%

100% 100% 100% 100%

The major categories of plan assets as a percentage of total plan assets are:

The amounts recognised in the balance sheet are: UK Office Scottish 2012 2011 scheme scheme Total Total £m £m £m £m

Fair value of plan assets 25.5 7.4 32.9 31.5

Present value of scheme obligations (23.1) (8.2) (31.3) (28.7)

Restriction of scheme surplus (1.1) - (1.1) (2.1)

Net surplus / (deficit) 1.3 (0.8) 0.5 0.7

The British Red Cross has recognised the UK Office scheme surplus to the extent that it is considered recoverable through the future service cost of the remaining members.

The latest triennial valuation for the Scottish scheme as at 1 January 2012 showed a deficit of £3.1 million. A pension deficit recovery plan is in place in respect of the Scottish scheme, which aims to eliminate the ongoing funding deficit by 2020. The additional employer contributions required from the Society as part of this recovery plan will be £0.4 million per annum, commencing in 2013. The Society expects to contribute 22.7 per cent per annum as a percentage of members’ salaries.

Changes in present value of scheme obligation during the year: 2012 2011 2012 2011 £m £m £m £m

2012 2011 2012 2011 £m £m £m £m

UK Office scheme Scottish scheme

UK Office scheme Scottish scheme

UK Office scheme Scottish scheme

At 1 January 21.1 19.8 7.6 6.4

Service cost 0.3 0.3 0.1 0.1

Interest cost 1.0 1.1 0.3 0.3

Member contributions - - - -

Benefits paid (0.9) (0.8) (0.2) (0.2)

Actuarial gain arising from government changes to statutory pension increases - - 0.2 -

Actuarial losses due to changes in other assumptions 1.6 1.1 0.2 0.5

Actuarial (gain) / loss due to experience - (0.4) - 0.5

At 31 December 23.1 21.1 8.2 7.6

Change in the value of plan assets during the year:

The British Red Cross expects to make employer contributions in 2013 of £163,000 for the UK Office scheme and £520,000 for the Scottish scheme.

At 1 January 25.0 23.0 6.5 5.8

Expected return 1.1 1.4 0.3 0.4

Employer contributions 0.3 0.7 0.5 0.5

Member contributions - - - -

Benefits paid (0.9) (0.8) (0.2) (0.2)

Actuarial gain on plan assets - 0.7 0.3 -

At 31 December 25.5 25.0 7.4 6.5

Notes to the consolidated financial statements for the year ended 31 December 2012

43

Principal actuarial assumptions at the balance sheet date in respect of both schemes were:

Mortality assumptions in respect of both schemes adopted at the year end imply the following life expectancy at 65:

History for current and previous periods:

History for current and previous periods:

2012 2011

Years Years

2012 2011 2010 2009 2008 £m £m £m £m £m

2012 2011 2010 2009 2008 £m £m £m £m £m

Pensioners: male 22.8 22.5

Pensioners: female 25.1 25.0

Non-pensioners: male 25.0 24.8

Non-pensioners: female 27.5 27.4

Discount rate 4.4% pa 4.7% pa

Retail price inflation (RPI) 3.1% pa 3.3% pa

Consumer price inflation (CPI) 2.8% pa 2.6% pa

Salary increases 2.8% pa 2.6% pa

UK Office scheme pension increases

Capped at 5.0% 2.8% pa 2.6% pa

Capped at 2.5% 2.2% pa 2.2% pa

Scottish scheme pension increases

Pre-2005 increases 2.8% pa 3.3% pa

Post-2005 increases 2.2% pa 2.2% pa

Expected return on equities 6.5% pa 6.5% pa

Expected return on bonds 3.0% pa 3.0% pa

Expected return on cash 0.5% pa 1.1% pa

Present value of scheme obligations (23.1) (21.1) (19.8) (19.1) (15.5)

Fair value of plan assets 25.5 25.0 23.0 20.6 18.3

Surplus 2.4 3.9 3.2 1.5 2.8

Restriction of surplus (1.1) (2.1) (1.5) (1.5) (2.8)

Reported surplus 1.3 1.8 1.7 - -

Experience gains / (losses) on liabilities - 0.4 - - (0.5)

on assets - 0.7 1.1 1.2 (3.7)

Present value of scheme obligations (8.2) (7.6) (6.4) (6.7) (4.8)

Fair value of plan assets 7.4 6.5 5.8 5.1 4.2

Deficit (0.8) (1.1) (0.6) (1.6) (0.6)

Experience gains / (losses) on liabilities - (0.5) 0.7 - -

on assets 0.3 - 0.2 0.4 (1.1)

14. Pensions (continued)

UK Office scheme

Scottish scheme

44

15. Obligations under operating leases

17. Analysis of changes in net short-term funds less borrowing

18. Related parties

16. gross cash flows

The amount payable within the next twelve months on leases expiring:

Capital expenditure and financial investment

2012 2011 Property Other Total Total £m £m £m £m

At 1 At 31 January Investment December 2012 Cash flow gains 2012 £m £m £m £m

2012 2011 £m £m

Within one year 0.4 0.1 0.5 0.4

In two to five years 1.4 1.0 2.4 3.0

After five years 2.7 - 2.7 3.3

Total 4.5 1.1 5.6 6.7

Sales of fixed asset investments 19.4 11.3

Purchase of fixed asset investments (4.0) (3.0)

Sale of tangible fixed assets 1.8 2.7

Purchase of tangible fixed assets (6.2) (8.0)

Net cash inflow 11.0 3.0

Cash at bank and in hand 4.0 2.5 - 6.5Loan due after one year (0.3) - - (0.3)Current asset investments 6.6 5.2 - 11.8

Total 10.3 7.7 - 18.0

Mr Stanley Fitches is a trustee and a pensioner member of the British Red Cross’s closed defined benefit pension scheme and received payments in the year of £32,360 (2011: £31,987).

Mr Steve John is a trustee of the British Red Cross and the corporate affairs director with Bupa. During 2012 the British Red Cross received income of £8,966 and incurred health insurance expenditure of £41,224 from Bupa. The relationship between the British Red Cross and Bupa is a historic one which was established prior to Steve John becoming a trustee.

Other schemesThe British Red Cross also contributes to the British Red Cross Group Personal Pension Plan and other contribution schemes for certain employees. In 2012 the total cost of these contributions was £1.9 million (2011: £1 million).

Staff were able to join the Pensions Trust’s Growth Plan until April 2007. The Pensions Trust’s Growth Plan is a multi-employer defined benefit pension plan. The assets of the scheme are co-mingled for investment purposes and as a result it is not possible to either break down scheme assets or analyse the ongoing funding deficit by individual employer. Accordingly, due to the nature of the plan, the accounting charge for the year under FRS 17 represents only the employer contribution payable. There is a contingent liability in the event that the British Red Cross were to withdraw its membership of the Pensions Trust’s Growth Plan. The Pensions Trust’s Growth Plan’s actuaries valued the withdrawal liability at £6.3 million as at 30 September 2011. This valuation has been rolled forward, assuming actuarial assumptions and membership are consistent, to 31 December 2012 resulting in an estimated £7.6 million contingent liability (2011: £6.5 million). The results of the Growth Plan scheme valuation as at 30 September 2011 show a deficit of £148 million. A recovery plan has been established which aims to eliminate the funding deficit over a period of 10 years from April 2013. The additional employer contributions required from the Society as part of this recovery plan will be £0.3 million per annum. The Society expects to contribute 1 per cent per annum as a percentage of members’ salaries.

The British Red Cross and the Order of St John are jointly liable for the pension liabilities of the Joint Committee of the Order of St John of Jerusalem and British Red Cross Society (‘Joint Committee’). The Joint Committee is a separate charity (charity no 225753) for the purposes of charity regulation. The Pensions Trust’s Growth Plan’s actuaries valued the withdrawal liability at £2 million as at 30 September 2011. This valuation has been rolled forward, assuming actuarial assumptions and membership are consistent, to 31 December 2012 resulting in an estimated £2.1 million contingent liability (2011: £3 million). This liability became payable in January 2013 when the Joint Committee withdrew from the scheme. The Joint Committee holds assets of £1.1 million (2011: £1.1 million) which are held solely for settling the pension liability. The British Red Cross’ share of the liability is estimated at £0.6 million.

Notes to the consolidated financial statements for the year ended 31 December 2012

14. Pensions (continued)

45

20. Programme commitments

2012 2011 Unrestricted Restricted Total Total £m £m £m £m

Balance 1 Balance 31 January 2012 Income Expenditure December 2012 £000 £000 £000 £000

Capital commitments - 0.7

19. Capital commitments 2012 2011 £m £m

2012 2011 £m £m

The British Red Cross regularly pledges support to programmes led by the International Federation of Red Cross and Red Crescent Societies (IFRC), International Committee of the Red Cross (ICRC) or other National Societies. Full payment of the pledges is contingent on the outcome of British Red Cross reviews of the programmes. The British Red Cross had outstanding pledges to the following programmes:

Balances as at 31 December 2012 are included within our restricted funds.

During the year the Big Lottery Fund and Awards for All provided grants for the following projects:

South African Red Cross Society - KwaZulu Natal Integrated HIV and TB programme 2011-16 (Phase II) 3.1 4.0

Uganda Red Cross Society - Reducing Community Risk and Strengthening Disaster Response programme 2.2 2.5

Lesotho Red Cross Society - Integrated HIV and Food Security programme (2010-2014) 0.7 0.7

Red Crescent Society of Kyrgyzstan - Women, HIV and Organisational Development programmes - 0.8

Bangladesh Red Crescent - Vulnerability to Resilience 2.1 -

Myanmar Red Cross - Watsan / Maternal, Neonatal and Child Health programme 0.8 -

Other programmes 0.7 1.2

Total 9.6 9.2

Tangible fixed assets 56.7 7.5 64.2 64.4

Fixed asset investments 5.1 30.0 35.1 49.1

Net current assets 35.2 (0.3) 34.9 25.7

Creditors: amounts falling due in more than one year - (0.3) (0.3) (0.3)

Provisions for liabilities and charges (2.2) - (2.2) (3.4)

Defined benefit pension scheme surplus 0.5 - 0.5 0.7

Net assets 95.3 36.9 132.2 136.2

Refugee orientation - Bradford 4 - (4) -Refugee orientation - Manchester (Reaching communities) 7 82 (79) 10Refugee orientation - Portsmouth - 20 (7) 13Refugee service - Leicester 24 52 (51) 25Refugee service - Nottingham / Derby 19 96 (89) 26Refugee unit - Birmingham 13 95 (77) 31Dawn patrol - Merseyside 14 41 (37) 18Dawn patrol - Wigan 25 48 (44) 29Young carers ‘have a say’ in Shropshire 10 62 (53) 19Young carers Wales 6 22 (23) 5Gofal north Wales 8 187 (195) -Mobile medical loan outreach Wales 16 45 (53) 8Asylum seeker destitution support - Liverpool - 24 - 24

Total 146 774 (712) 208

21. Analysis of net assets between funds

Purpose of grant

22. Big Lottery Fund and Awards for All

46

Thank you

The British Red Cross would like to thank every individual and organisation who supported our work in 2012. They responded with great compassion and speed at times of emergency as well as maintaining our ongoing work in the UK and overseas. We would particularly like to thank all those who support us regularly, enabling us to plan ahead with confidence. We remember with gratitude the generosity of donors who left gifts to us in their wills. We would also like to thank all our local fundraising committees and volunteers for their hard work.

we would like to give special thanks to: The European Commission for generously supporting our work with young volunteers through EVS and PROGRESS funds and the prevention of TB and HIV in Kazakhstan Lifetime members of the Tiffany Circle and their partners, including Anne and Andrew Balfour and Quenelda and Julian Avery Allen & Overy LLP The Bernard Lewis Family Trust The Bradbury Foundation Canon Carrousel Capital City Bridge Trust GlaxoSmithKline Guernsey Overseas Aid Commission Isle of Man Overseas Aid Committee Jersey Overseas Aid Commission JMP Wilcox John Lewis Partnership Land Rover vInspired

Thanks also to members of the following committees: Berkshire Appeals Committee Cambridgeshire Fundraising Committees Mrs June Clague and the Isle of Man Committee Lady Eileen Duncan and the Dumfries and Galloway Golf Committee East Suffolk Fundraising Committee Hampshire Ball Committee The London Christmas Fair Committee Dr Sindy Newman and the Tiffany Circle Steering Committee Mrs Georgiana Osborne and the Tayside Golf Committee Maria Shammas MBE and the International Fundraising Committee Uttlesford Centre Autumn Gift Fair Committee Mrs Flora Walker and the Lothian Ball Committee

Thanks also to: AstraZeneca Bloomberg Dr E Boyd and Miss J A Boyd BT The Cargill Trust Mrs Henrietta Cayzer City of London Corporation Clifford Chance LLP Mr Terry Cross of Delta Print and Packaging Deloitte Hilary Douglas, President of Surrey Eucalyptus Charitable Foundation Gatwick Airport Community Trust Mrs Dorothy Gower John James Bristol Foundation LifeScan Scotland Lloyd’s Charities Trust Lotus Foundation Mr John Maclean Melbreak Charitable Trust News International Group Limited The Dowager Countess Eleanor Peel Trust The Sir James Reckitt Charity River Island Royal Bank of Scotland Group Scouloudi Foundation Summerfield Charitable Trust Tesco The Tula Trust Mr Boyd Tunnock CBE Wales Council for Voluntary Action The Wolfson Foundation Zochonis Charitable Trust

Patron Her Majesty The Queen

President His Royal Highness The Prince of Wales KG KT GCB OM

Deputy presidents Her Royal Highness Princess Alexandra The Hon Lady Ogilvy LG GCVO The Countess Mountbatten of Burma CBE CD JP DL

Honorary vice-presidents Lord Barnard TD The Rt Hon Baroness Chalker of Wallasey Sylvia, Countess of Limerick CBE Professor John McClure OBE Mrs Elspeth Thomas CBE DL

Vice-presidents Mr Anthony Andrews Ms Angela Rippon OBE Mrs Maria Shammas MBE

Board of trustees Mr James M. T. Cochrane, chair (until 31 December 2012) Sir Charles Allen CBE, chair (from 1 January 2013) Mrs Victoria Peterkin, vice-chair (until 31 December 2012) Mr David Fall CMG, vice-chair Mrs Stella Cummings, vice-chair Mr David Howell, treasurer Mrs Susan Brown (until 31 December 2012) Mrs Hilary Douglas CB (from 1 January 2013) Mr Stanley Fitches MBE (until 31 December 2012) Ms Amy Foan Mr Michael Herriot MBE Mrs Uzo Iwobi Mr Steve John Lady Angela Lamport Dr Lise Llewellyn Mr Gordon Low Mrs Gill Moffat (from 1 January 2013) Dr. Daniel Sedgewick (from 1 January 2013) Mr Keith Shipman Mr Graham Stegmann CBE (until 31 December 2012) Mr Paul Taylor

Board sub-committees include: Finance and audit committee Remuneration committee Nominations committee

Senior management team Sir Nicholas Young, chief executive Michael Adamson, managing director of operations Roger Smith FCIPD, director of people and learning Mark Astarita, director of fundraising Philip Talbot, director of communications Rohan Hewavisenti ACA, director of finance and business development Caroline Leighton, chef de cabinet David Peppiatt, director of international Margaret Lally, director of UK service development Norman McKinley, UK director, Scotland, Northern Ireland and the Isle of Man Territory Jean Henderson, UK director, Northern Territory Annie Bibbings, UK director, Wales and Western Territory Liz Page, UK director, South Eastern Territory

External auditors BDO LLP 2 City Place Beehive Ring Road Gatwick West Sussex RH6 0PA

Bankers National Westminster Bank plc City of London Office PO Box 12258 1 Princes Street London EC2R 8PA

External legal advisers Withers Old Bailey London EC4M 7EG

Investment managers BlackRock 33 King William Street London EC4R 9AS

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Email: production@redcross.org.uk Tel: 020 7877 7029

British Red CrossUK Office44 MoorfieldsLondon EC2Y 9AL

Tel: 020 7877 7284Fax: 020 7562 2000redcross.org.uk

Published 2013

The British Red Cross Society, incorporated by Royal Charter 1908, is a charity registered in England and Wales (220949) and Scotland (SC037738).