I am pleased to present my statement for The Golden Charter Trust for the year ended 31 March 2023.
At the end of the financial year, we said farewell to Iain Webster as a Trustee. After joining in 2012, Iain made a very significant contribution to our financial and operational strength and was a valuable source of wisdom and good advice.
Net asset value at 31 March 2023:
The Trust’s investment portfolio is held in The Golden Charter Trust Limited, a company 100% owned by the Trust. The audited accounts of this company for the year ended 31 March 2023 are available here.
The audited net assets of the Trust at the 31 March 2023 totalled £1.182 billion (2022 audited – £1.282 billion). Details on the performance of the Trust’s investment portfolio are given in the Investment Report.
The charts below show how the value of the Trust and the average value of an outstanding funeral plan have grown from 31 March 2018 to 31 March 2022.
Regulation:
Our working relationship with Golden Charter Limited continues to be close and effective. As I explained in last year’s report, it has been adapted in order to reflect the new regulatory regime, effective from 29 July 2022, under which all funeral plan providers are subject to authorisation and ongoing supervision by the Financial Conduct Authority (FCA).
The Trust is not subject to direct FCA regulation, but the Trust Deed between Golden Charter Limited and the Trust has been changed to reflect the new obligations which the FCA imposes on Golden Charter Limited as a plan provider.
Separate legal advice was taken by the Trustees to clarify our ongoing obligations, as an independent non-regulated entity, to act in accordance with Trust law while at the same time co-operating with Golden Charter Limited as necessary to meet its new FCA obligations.
One significant requirement of the FCA is that Golden Charter Limited takes sole responsibility for commissioning an independent actuarial report, known as a Solvency Assessment Report (SAR), which estimates the ratio between the Trust’s assets and the costs of the funerals underwritten by it.
The FCA rules set out a list of permitted payments from funeral plan trusts which have been incorporated in our new Trust Deed. One of the permitted payments is the payment of an agreed amount of the total available surplus to Golden Charter Limited. The payment of surplus is subject to separate rules on the solvency level of the Trust, as determined by the SAR, and must be approved by an independent actuary appointed by Golden Charter Limited. Any request for payment of surplus must not, in the reasonable opinion of the Trustees, be in any breach of any other legal or regulatory obligation applicable to the Trust of the Trustees.
Outlook:
The impact of rising inflation and interest rates on investment returns and funeral costs has been a major focus of attention this year and we continue to follow a policy of holding a diverse portfolio of quality assets, with an appropriate balance between protection and growth.
Lastly, it is again both a duty and a pleasure to thank my fellow Directors and our employees for their hard work and dedication over the past year.
Gareth Howlett
Chair
30 June 2023