The Christie Foundation Trust Annual Report and Accounts 2021-22

(a) For each Research and Development contract, the Trust transfers control of goods and services over time and therefore, satisfies performance obligations and recognises revenue over time. This may be over several financial years. Research and Development income recognised is in equal value to the cost in the financial year of satisfying the performance obligations. See note 15.

(b) The basis upon which the Modern Equivalent Asset Valuation is assessed for land by the external valuer is the alternative theoretical site.

1.1.3.2 Sources of estimation uncertainty

The following are assumptions about the future and other major sources of estimation uncertainty that have a significant risk of resulting in material adjustment to the carrying amounts of assets and liabilities within the next financial year.

(a) Non-current Property, Plant and Equipment asset valuation relating to land and buildings are based on the District Valuers valuation - see note 10.

The uncertainty over future changes to estimations of the carrying amount of land and buildings is mitigated by the annual independent valuation of these assets. The estimation methods used by the independent valuer draw upon, but are not limited to, industry recognised building construction indices and relevant or comparable transactions in the market place.

A simple sensitivity analysis indicates that a 3% movement in these estimations would increase or decrease the valuation of assets by £8.7m. In comparison, a 10% change in values in land and buildings would be £29.0m. A 10% change in valuations would result in an increase or decrease in PDC dividend payable of £508k.

1.1.4 Consolidation

"The Consolidated Accounts of The Christie NHS Foundation Trust show both the NHS Foundation Trust and the Group balances. The Group balances comprise The Christie NHS Foundation Trust, The Christie Charitable Fund and The Christie Pharmacy Limited which are consolidated on a line-by-line basis."

The Christie Charitable Fund

The Foundation Trust is the corporate trustee to The Christie Charitable Fund. The Foundation Trust has assessed its relationship to The Christie Charitable Fund and determined it to be a subsidiary because the Foundation Trust is exposed to, or has rights to variable returns and other benefits for itself, patients and staff from its involvement with the charitable fund and has the ability to affect those returns and other benefits through its power over the fund.

The Charitable Fund's statutory accounts are prepared to 31 March in accordance with the UK Charities Statement of Recommended Practice (SORP) which is based on Financial Reporting Standards (FRS) 102.

On consolidation, necessary adjustments are made to the charity's assets, liabilities and transactions to:

- recognise and measure them in accordance with the Foundation Trust's accounting policies; and - eliminate intra-group transactions, balances, gains and losses.

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