The Golden Charter Trust was established in 1990 to hold, invest and administer the funds received from individuals and families who purchase funeral plans sold by Golden Charter Limited.
The investment objective of the Trust is to invest the funds received with a view to ensuring that, at all times, there are sufficient funds to meet the anticipated invoice costs of all outstanding and maturing funeral plans.
The Trust exists both for the protection of funeral directors who have undertaken to carry out the funeral services in accordance with the plan terms and conditions, and for the plan holders themselves. To ensure this protection, the Trust’s assets are entirely separate and independent of the plan provider, Golden Charter Limited.
The Trust is governed by its Trust Deed which requires the Trustees to comply with the rules of the Funeral Planning Authority (FPA) of which Golden Charter Limited is a registered provider. In addition, the Trust must comply with the Financial Services and Markets Act (Regulated Activities) Order 2001.
The Trust’s investments are held by The Golden Charter Trust Limited, which is wholly owned by the Trust. Holding its investments in a company allows the Trust to conduct its investment business more efficiently and to take advantage of the lower taxation rates applicable to companies. The Trustees of The Golden Charter Trust are appointed as the directors of The Golden Charter Trust Limited and so the safeguards provided by the Trust were unaffected by this arrangement.
How the Trust is administered and managed:
The Trust is administered by a Board of Trustees comprising of experienced business people from a wide range of backgrounds. They are required by majority to be independent of Golden Charter Limited. In addition, the Trust employs a full-time Executive Director and a Risk & Compliance Manager who have responsibility for managing the legal, financial and administration affairs of the Trust on a day-to-day basis.
The Board of Trustees is responsible for all executive decisions. However, certain areas, including investment strategy, are assigned to the various subcommittees for specific focus and to make recommendations to the Board.
The Working Group comprises of a mix of trustees and representatives of Golden Charter Limited. It is tasked with ensuring effective communication of all issues of mutual interest to Golden Charter Limited and The Golden Charter Trust including product developments within Golden Charter Limited and the impact of developments within the wider funeral planning sector.
The Investment Strategy Group members all have significant investment experience. In performing their strategic investment function, the Investment Strategy Group take advice from their investment advisers, Barnett Waddingham LLP, and from the various appointed investment managers who perform the day-to-day portfolio management within their agreed mandate.
The Audit Committee meets to consider risk, governance and compliance issues. In addition, the audit committee oversees the production and audit of the annual financial statements of the Trust and its subsidiary. The Trust’s audited accounts and the actuarial valuation of the assets and liabilities of the Trust are sent annually to the Funeral Planning Authority.
The Nominations and Remuneration Committee is responsible for ensuring the performance of the Board of Trustees and individual Trustees is regularly reviewed. It also makes recommendations on the level of Trustees’ remuneration and for trustee retirement by rotation and for the process of appointing new trustees.
How plan money is protected and invested:
All monies received directly into the Trust from the sale of funeral plans are invested (net of up-front deductions for administration costs) in accordance with the Trust’s investment strategy, which is designed to achieve the growth necessary to meet the investment objective of the Trust. How plan monies are protected and invested until required at time of need, is illustrated in the diagram below.
Expenses of the Trust:
The Trust incurs operating expenses for maintaining the Trust which includes fees paid to investment managers and professional advisers, and the remuneration of trustees and employees.
In addition to the direct operating expenses of the Trust, a plan maintenance fee is paid to Golden Charter Limited for the on-going maintenance and administration of live funeral plans for which the proceeds are held and invested by Trust.
The plan maintenance fee is paid in recognition of the costs incurred by Golden Charter Limited in maintaining plans throughout the period between initial sale and maturity. These costs include the compliance requirements of maintaining plan holders’ details, making any requested amendments to the wishes and arrangements for the delivery of the plan holders’ funerals through the appointed funeral directors, and settling the invoice amounts of funeral directors at the time of need.