Joint message from the Chair and Chief Executive

Since the economist Fritz Schumacher founded Practical Action over 40 years ago, we have supported millions of people to transform their lives. Schumacher’s groundbreaking book Small is Beautiful is still as relevant today as it was when published in 1973. We continue to live in a world where economic growth and technological advancement offers little for the two billion people living in abject poverty. And we still treat our planet as expendable – exploiting it beyond its natural capacity – and global warming is only one devastating result.

In 2011, we were delighted to celebrate the centenary of Fritz Schumacher’s birth. His achievements were recognised this year by the 2012 (En)Rich List ‘celebrating a wealth of inspirational individuals whose contributions enrich paths to sustainable futures’, which placed Fritz Schumacher first on their list of 100 great thinkers.

2011–12 was also the final year of our ambitious five-year strategy, which aimed to deliver direct benefits to three million people, helping them use technology to improve their access to food, jobs and basic services while reducing their vulnerability to disasters. To finance this we needed to grow our income by around 50% over the same period. Given that we believe strongly in taking action to tackle climate change, we also set ourselves a target of reducing our carbon footprint by 25%.

So, how have we done?

As a result of the extraordinary efforts of the communities we have worked with, partners, staff, and of course our supporters, we have met or exceeded the targets we set ourselves back in 2007.

We have:

• directly benefited over four million people;
• reduced our carbon footprint by around 28%;
• helped poor communities gain stable livelihoods, improve food security, increase incomes and access basic services such as water, sanitation, energy, waste management, housing and transport;
• reached out beyond our own projects and actively shared our experience and knowledge – and through this, multiplied the outcomes of our work, benefitting millions more poor people; and
• grown our annual income by nearly 50%, to £30.9 million.

But we would not have been able to do any of it without the generosity and commitment of the partners and donors who support us. We’re immensely grateful, but doubly in these times of widespread economic difficulty.

Stephen Watson, Chair
Simon Trace, Chief Executive

Annual report and accounts 2011-12

Reporting Back - Practical Action's annual report for 2011-12, including highlights of our work and full financial statement.

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Contents

• Joint message from the Chair and Chief Executive
• Report of the Board of Trustees
  1. Review of the year and five-year strategic objectives
  2. Financial review
  3. Structure, governance and management
  4. Legal and administrative details
• Independent auditor’s report
• Financial statements
  • Consolidated statement of financial activities
  • Consolidated and company balance sheet
  • Consolidated cash flow statement
  • Notes on the financial statements

How we raise the money

In 2011-12 Practical Action had an income of £30.9 million. Of this, 37% was raised from voluntary donations by individuals or by small family trusts and companies.

A further 53% came from grants made by the UK and other governments for development assistance, by multilateral development agencies such as the World Bank, and by other large funders such as international trusts, and 10% came from the income of Practical Action's publishing and consultancy subsidiaries.

How is the money spent?

Practical Action spent £25.9 million in 2011-12. The majority of spending, 77%, was directly on our programmes round the world. 10% of expenditure was on the operations of the subsidiaries, and 12% was reinvested in further fundraising. Only 1% of expenditure was on management and administration (calculated by UK Charity Commission-regulated norms).