How the Finances are managed
When selecting a care home for yourself or a loved one it is important to consider a number of factors.
One of these is to ensure that the home is a viable proposition in financial terms. This is not only if it is affordable but whether the home is going to be there tomorrow.
The trustees, who include amongst their number people who have experience in the financial sector, are charged, amongst their other duties, to ensure that Ridout House is financially sound. It is important that all stakeholders whether residents, their families, staff or suppliers are satisfied that the trustees are serious in carrying out this important role.
Whilst Ridout House is a charitable concern it is important to ensure there are funds available for any eventuality that may either adversely affect the income generated or for emergency/planned repairs/renovations. To this end there is a separate Financial Committee that reviews all matters relating to the Charity’s finances.
One key element of this is a sensitivity analysis that is undertaken on annual basis by the trustees. This financial model looks at the costs of running the home and what income is required to break even or make a profit. Thus the trustees will be aware of the combination of occupancy and level of contribution depending on care level to ensure that the business is robust to withstand any shocks.
This acts as an early warning system so the trustees so action can be undertaken to address the situation. The occupancy rate is reviewed quarterly.
A budget is also produced and as the year goes on this is compared with the actual financial performance.
The Financial Committee reports to the main Trustee board.
Thus the financial aim is to make a sufficient profit to provide the foundation for a sustainable home for our residents and some comfort for the key element of achieving our aims- our staff. On a quarterly basis the trustees review the finances of the home (the trustee acting as Honorary Treasurer is a qualified accountant) and the accounts are fully audited.
Given the increasing regulation which although brings benefits/comfort to residents and their families it also gives rise to costs. In recent years we have found the need not only to have regular legal advice to keep to the forefront of changes but we have also have had to employ a part-time administrator. This allows our Head of Home to concentrate her primary role of delivering care to the residents rather than being bogged down in paperwork.
However, we are dependant on public and private charitable donations to cater for some capital projects and equipment needs that emerge from time to time in order to keep pace with the standards expected in an evolving care sector.
We have been very successful over the past few years in raising over £400,000, thanks to our previous fundraiser, Jurat Geoffrey Allo and the generosity of donors. The most recent large project was refurbishment of our lift which cost over £50,000 though the new stair lift was funded by our reserves.
For more recent projects please refer to our Fundraising tab.