Arhag Annual Report 2019/2020

Theme/Goal: GROWTH & EFFICIENCY Objective/target Risk/uncertainty Mitigation To grow the business organically To reach 900 properties owned or managed We now have 920 properties, however, this might change if we need to hand back more properties to Newham council and if we sell the remaining stock in South London. The changing profile of the housing sector and relationships with our stakeholders pose a risk. The housing market might not enable us to sell our stock in South London in favour of properties in North London. We continue to build relationships with our stakeholders, open ourselves up to other non-traditional partners for growth opportunities. We also seek to become financially strong so that we can grow and sustain future developments. To extend Arhag’s influence in Newham, Tower Hamlets, Hackney, Barking and Redbridge to maximise opportunities for growth Our aptitude around building good relationships to enhance working relationships with stakeholders creates uncertainty. We are working to enhance our relationships with our partners and residents to share common goals. Concentrate on properties in North London We may not be able to find suitable properties to increase our portfolio in the North and East quarters of London. We are in talks with developers and other partners to continue to grow our presence in North London. To add new income streams To consolidate and extend the hub income streams through the provision of services to partners Financial challenges faced by our partners or the lack of availability of commercial developments in the current financial and operating climates might slow down our ambition. Failure to add new income streams may result in reduced operating surplus that will adversely affect our capacity to fund our social purpose. We are offering commercial support to our partners to remain financially stable, and we are exploring new income streams for both Arhag and our partners. To be undertaking selective commercial developments There is risk around processing the commercial capability to instigate and deliver growth. We have recruited staff and partners who have the commercial capability required. Greater efficiency and VFM To provide housing management services to other housing organisations We risk not being able to offer services which are attractive to other housing associations. We will research into what services will be attractive for small and larger housing associations. To own Arhag’s head office There is a long-term risk that the office might not service Arhag’s needs in the future. We now own our head office, instead of high levels of rent. To reduce Arhag’s tax liability HMRCmight not agree with the approach or methodologies Arhag wish to use. We have included a VAT partial exemption special method in our accounts, which will reduce our costs, this has been agreed by HMRC in principle. To have a pro-active VFM strategy Risk lies around the financial climate for control of expenditure and knowledge of value for money services which do not suffer in quality. We will continue to address the economic climate by ensuring value for money is achieved in all we do and ensure that we retain open channels of communication to enable collaborative solutions where required. Annual Report 2019-2020 21