In all civil cases where an Appeal lies to the House of Lords under the provisions of the Appellate Jurisdiction Act 1876, Appellants must provide security for the costs of such Appeals. The House of Lords Security Fund Account records the receipt, payment and disposition of the lodgements for each financial year. The sum lodged by the Appellants is a statutory amount as authorised from time to time by the House of Lords' Offices Committee. The most recent revision was in October 2000 when it was increased from £18,000 to £25,000. No other receipts and payments are entered on the account; no interest is paid on the lodgements, nor are any fees deducted. Security Fund monies are payable to the relevant party, usually on issue of the Final Judgment or Taxation of the Bill of Costs.

	2001-02		2000-01
	£000		£000
Opening Balance of Fund at 1st April	1,169		1,056
Add Receipts:
Lodgements by Appellants	750		509
	1,919		1,565
Less Repayments:
Repayments to Appellants/Respondents	(614)		(396)
	(614)		(396)
Closing Balance of Fund at 31st March	1,305		1,169

The closing balance of £1,305,000 was made up of 1 Deposit of £12,000, 26 Deposits of £18,000 and 33 Deposits of £25,000

25. The House of Lords Works of Art Collection Fund

The Works of Art Collection Fund was established for the purpose of acquiring works of art for the House of Lords. Prior to 1^st April 1992, it was funded by grant from the Department of the Environment. For the financial years 1992-93 and 1993-94, provision was made to meet expenditure from the House of Lords Works Services Vote. With effect from 1994-95 an annual grant is made from the Works Services Vote to the Works of Art Collection Fund and unspent balances of up to a maximum of £80,000 may be carried forward. The annual grant was increased to £29,000 in April 2001. The Fund is regulated by a Financial Memorandum drawn up by the Offices Committee (replaced by the House Committee in November 2002).

	2001-02		2000-01
	£000		£000
Opening balance of Fund at 1st April	22		32
Add receipts:
Grant from Works Services Vote (see (a) below)	57		-
Net interest received	1		-
	80		32
Less: Purchases during the year (see (a) below)	52		10
	52		10
Closing Balance of Fund as 31st March	28		22

1. The grant of £28,000 for 2000-01 was paid into the account after 31^st March 2001. This reflects in the accounts for 2001-02

1. Purchases during the year (which are included within additions in fixed assets note 10a)

               

Description	£
Coronation Banquet of George lV; oil on board by George Jones	1,882
The House of Lords in session 1859; hand-coloured engraving	200
View of Westminster Bridge; watercolour by Myles Birkett Foster	4,450
Battle of Waterloo; hand-coloured engraving	469
Portrait of Lord Keeper Edward Lyttleton	1,059
Sketch for the Body of Harold by Ford Madox Brown	35,875
Two Colour Prints by John Piper	1,500
Consequences of a successful French Invasion; engraving by James Gillray	85
10 modern prints by various artists	2,000
The Court of Exchequer; pencil, ink and wash drawing by Thomas Rowlandson	2,411
New Parliament 2001; lambda photographic print by Stephen Walter	700
King George V's Jubilee Speech in Westminster Hall; Oil on canvas by Charles Brewer	1,235
Total	51,866

26. House of Lords' Refreshment Department Trading Activities

The House of Lords' Refreshment Department provides a wide range of catering facilities to Members and House of Lords' staff. Members may sponsor private functions and this type of service accounted for 50% of sales in 2001-02.

The Refreshment Department operates under a policy first agreed between the House of Lords and HM Treasury in 1981. In accordance with this policy, the department is required to ensure that private function trading and retailing is self financing and the department is also required to trade on the basis of 50% gross profit on all turnover. On 23^rd May 1990, the Leader of the House stated that sales of tobacco, confectionery and goods to be consumed or used outside the department, together with the cost of services at functions, would be excluded from the turnover figure against which gross profit is measured for the purpose of this target.

Total trading sales for 2001-02 amounted to £2,731,912. Gross profit on sales calculated according to the formula above was 67.6%.

Further performance targets for trading in individual outlets of the department have been agreed, and are reviewed annually, by the Refreshment sub-committee of the Offices Committee (replaced by the Refreshment Committee in November 2002).

27. Financial Instruments

FRS 13, Derivatives and Other Financial Instruments, requires disclosure of the role which financial instruments have had during the period in creating or changing the risks an entity faces in undertaking its activities.

Liquidity Risk

The House of Lords is financed by supply voted annually by Parliament for the House of Lords Peers Expenses, Administration etc. and the House of Lords Works Services expenditure. As such it is not exposed to significant liquidity risks.

Interest rate risk

All of the House of Lords' financial assets and liabilities carry nil or fixed rates of interest. The House of Lords is not therefore exposed to significant interest rate risk.

Foreign currency risk

Foreign currency would not usually form part of the House of Lords' assets and liabilities and as such it is not exposed to any significant foreign currency risks.