Value for Money metrics - Technical note guidance 2026
This note includes the value for money metrics providers must report on as part of their Annual Accounts reporting, and explains how to calculate the metrics.
Applies to England
Documents
Details
Contents
1. Introduction
3. The Value for Money metrics
Annex A: Reference lines to FVA 2026
Annex B: Guidance on the VFM metrics reporting for small providers
1 - Introduction
1.1 - The Value for Money Standard requires all private registered providers to annually report on their performance against a suite of measures defined by the regulator, along with their own value for money (VFM) measures and targets, with which to measure economy, efficiency, and effectiveness.
1.2 - This technical note document sets out the details of the range of VFM metrics and how these are defined, including the calculation of each measure from the Electronic Annual Accounts (FVA) 2026.
Important changes and points to note
1.3 - We have made no amendments to the VFM metrics nor their measures for the financial reporting year ending 2026.
1.4 - There are changes to a limited number of lines on the FVA template which are reflected in Annex A in this Note. Specifically, the particulars of turnover and operating expenditure from social housing lettings in part D (the operating surplus note) now has two additional columns which split out income and expenditure relating to general needs housing, supported housing and housing for older people between social rent and affordable rent.
1.5 - As a reminder, since 2025, providers are required to recognise capitalised major repairs grant received when calculating the EBITDA MRI Interest Cover metric. This is to ensure the calculation reflects both the cost of undertaking capitalised major repairs and any grant funding that is associated with meeting those costs. The recognition of grant income relating to capitalised major repairs is highlighted in Annexes A and B.
1.6 - Amendments to FRS102 and the Housing SORP are effective for accounting periods commencing on or after 1 January 2026. For the majority of providers, the first period to which the amended standards will apply will be the year ending 31 March 2027. Therefore, there are no implications for the FVA template this year as a result of the new accounting requirements, and references to FRS102 and the 2018 version of the Housing SORP in the FVA guidance.
1.7 - However, the figures submitted in the FVA should reflect the accounting treatment used in the published financial statements. If early application of the revised standards has been adopted for the year-ending 31 March 2026, please provide details of the adjustments made in a supporting document as a part of the FVA submission on NROSH+.
1.8 - The Accounting Direction has been updated to reflect the amendments to FRS102 and the Housing SORP but has not introduced any new requirements.
1.9 - One of the key objectives in defining a set of standard VFM metrics was to support transparency and allow providers to analyse their performance alongside that of their peers on a comparable basis. To support this objective, we publish providers’ performance on the range of VFM metrics to help organisations benchmark their performance more easily and allow interested stakeholders to understand how providers perform when compared to the rest of the sector.
1.10 - The VFM benchmarking tool offers flexibility when comparing organisations with similar characteristics based on providers’ own knowledge of their peers, in particular, the location of the homes that they own and manage. The tool includes additional statistically significant factors which influence providers’ VFM performance such as stock height and the percentage of non-Social Housing Lettings (SHL) income. The VFM benchmarking tool can be found on the RSH website.
1.11 - Small registered providersfootnote 1 should refer to Annex B which sets out how the VFM metrics are calculated, using designated lines from their annual accounts (financial statements).
2 - Reporting expectations
2.1 - The VFM metrics have been selected on the basis that they work for the majority of the sector. However, we acknowledge that any metric, however calculated, may be more appropriate for some providers than others, and there may be a minority of cases where reporting on a particular basis is difficult, or inappropriate, given the unusual nature of a given organisation’s business or differences in accounting practice.
2.2 - We cannot change the required VFM metrics for individual providers because this would undermine comparability of results across the sector. However, where a provider’s reported data is affected by a factor particular to that organisation, they should clarify this in the commentary accompanying the publication of their data.
2.3 - It is essential that the metrics are calculated on the precise basis required. Inconsistent or inaccurate reporting undermines transparency to tenants and other stakeholders and could affect the reputation of an organisation.
2.4 - Annually, we publish sector performance on the range of VFM metrics and achievements delivered by the sector. We also share feedback on how well providers are meeting and adhering to the reporting requirements of the VFM Standard in an effort to drive continuous improvement across the sector. In our latest report, we found that for around a third of large providers, the reported performance was misrepresented for at least three or more key VFM metrics, including on New Supply, Reinvestment, Headline Costs and EBITDA MRI Interest Cover, compared to the results calculated from the financial viability accounts (FVA) – the annual electronic regulatory return that replicates the accounts in data form.
2.5 - Typical departures from the requirements include failing to deduct gains on disposals from the operating surplus and excluding one-off or unusual transactions. For example, loan break costs associated with refinancing, or exceptional spend to address building safety, while some providers included the capital cost of stock transferred from other providers as part of their reported reinvestment metric in the accounts.
2.6 - While we recognise that unusual costs may cause reported results to be unrepresentative of underlying performance, providers must calculate and report the metrics in their accounts defined by the Technical Note and required by the Standard. Consistent reporting enables comparability across the sector which is undermined by deviation from the reporting requirements.
2.7 - Providers are encouraged to report on other value for money measures that increase stakeholder insight (including adjusting for the impact of unusual costs). However, these should be in addition to, not instead of, the Technical Note metrics.
2.8 - Another issue is reported differences in relation to unit numbers between the FVA and either the audited accounts or to other regulatory submissions. While there may be some differences in reported unit numbers between the FVA and the Statistical Data Return (SDR) due to different reporting periods and reporting on units that fall outside of England, inaccurate data results in flawed metrics, rendering the benchmarking process misleading. Providers should, as far as possible ensure that the reported units in data returns and the audited accounts are correct to ensure the benchmarking tool functions at its highest potential.
2.9 - We will continue to seek assurance that providers make best use of their resources and have on-going plans in place to make improvements to the value for money in their organisations. As a part of our assurance work, relating to the outcomes of the VFM Standard, we will also use the VFM metrics to support our understanding of providers’ overall strategic delivery performance. We may follow up with a provider where there are gaps or conflicting evidence and will come to a view regarding the level of assurance we have about the provider in the delivery of the outcomes of the VFM Standard.
2.10 - Further detail of the regulator’s approach to value for money regulation is set out in Regulating the Standards.
3 - The Value for Money metrics
Metric 1 – Reinvestment %
3.1 - The Reinvestment metric looks at the investment in properties (existing stock and new supply) as a percentage of the value of total properties held.
3.2 - This metric is not based on cashflow data, due to the limitations on data collected as part of the FVA return.
3.3 - For tangible fixed assets, providers should use the measure agreed in their Statement of Financial Position / Balance Sheet. The figure should be either historic cost or valuation.
| Measurement of VFM cost chain – efficiency | Enter value in FVA as |
|---|---|
| [Development of new properties (Total housing properties) | Positive |
| + Newly built properties acquired (Total housing properties) | Positive |
| + Works to existing (Total housing properties) | Positive |
| + Capitalised interest (Total housing properties) | Positive |
| + Schemes completed (Total housing properties)] | Either |
| Divided by | |
| [Tangible fixed assets: Housing properties at cost (Current period) | Positive |
| OR Tangible fixed assets: Housing properties at valuation (Current period)] | Positive |
Metric 2 – New supply delivered %
3.4 - The New supply metric sets out the number of new social housing and non-social housing units that have been newly constructed (acquired or developed) in the year as a proportion of total social housing units and non-social housing units owned at period end.
3.5 - Registered providers will report on two New supply delivered ratios:
-
A: New supply delivered (social housing units)
-
B: New supply delivered (non-social housing units)
| A. New supply delivered (Social housing units) % Measurement of VFM cost chain – effectiveness |
Enter value in FVA as |
|---|---|
| [Total social housing units developed, or newly built units acquired in-year (owned): | |
| Social rent general needs housing (excluding Affordable rent), Affordable rent general needs housing, social rent supported housing and housing for older people (excluding Affordable rent), Affordable rent supported housing and housing for older people, low-cost home ownership, care homes, other social housing units, social leasehold] | Positive |
| Divided by | |
| [Total social housing units owned at period end (‘social units’ as defined in numerator)] | Positive |
| B. New supply delivered (Non-social housing units) % Measurement of VFM cost chain – effectiveness |
Enter value in FVA as |
|---|---|
| [Total non-social units developed, or newly built units acquired in-year (owned): | |
| Non-social rental housing units owned, non-social leasehold units owned, new outright sale units developed or acquired] | Positive |
| Divided by | |
| [Total social and non-social housing units owned at period end: | |
| Total social housing units and social leasehold units owned (as per denominator for the ‘A’ metric, new supply social housing), plus non-social rental housing units owned, plus non-social leasehold units owned] | Positive |
Metric 3 – Gearing %
3.6 - The gearing metric assesses how much of the adjusted assets are made up of debt, and the degree of dependence on debt finance. It is often a key indicator of a registered provider’s appetite for growth.
3.7 - For tangible fixed assets, providers should use the measure agreed in their Statement of Financial Position / Balance Sheet. The figure should be either historic cost or valuation.
3.8 - Note: registered providers can be restricted by lenders’ covenants and therefore may not have the ability in which to increase the loan portfolio despite showing a relatively average gearing result.
| Measurement of VFM cost chain – efficiency | Enter value in FVA as |
|---|---|
| [Short-term loans | Positive |
| + Long-term loans | Positive |
| - Cash and cash equivalents | Positive |
| + Amounts owed to group undertakings | Positive |
| + Finance lease obligations] | Positive |
| Divided by | |
| [Tangible fixed assets: Housing properties at cost (Current period) | Positive |
| OR Tangible fixed assets: Housing properties at valuation (Current period)] | Positive |
Metric 4 – EBITDA MRI Interest Cover %
3.9 - The Earnings Before Interest, Tax, Depreciation, Amortisation, Major Repairs Included (EBITDA MRI) Interest Cover measure is a key indicator for liquidity and investment capacity. It seeks to measure the level of surplus that a registered provider generates compared to interest payable; the measure avoids any distortions stemming from the depreciation charge.
3.10 - Note - Where applicable, capitalised major repairs grant received should be recognised when calculating the EBITDA MRI Interest Cover metric.
| Measurement of VFM cost chain – efficiency | Enter value in FVA as |
|---|---|
| [Operating surplus / (deficit) (overall) | Either |
| - Gain / (loss) on disposal of fixed assets (housing properties) | Either |
| - Gain / (loss) on disposal of other fixed assets | Either |
| - Amortised government grants | Positive |
| - Government grants taken to income | Positive |
| + Interest receivable | Positive |
| - Capitalised major repairs expenditure | Positive |
| + Capitalised major repairs grant received | Positive |
| + Total depreciation charge] | Positive |
| Divided by | |
| [Interest capitalised | Negative |
| + Interest payable and financing costs] | Negative |
Metric 5 – Headline social housing cost per unit
3.11 - The Headline social housing cost per unit is a proxy cash measure of a social housing cost per unit. This means it excludes non-cash items such as depreciation, amortisation and write downs.
3.12 - Leasehold units, which for example include Right to Buy and fully stair-cased shared ownership units where the provider retains the freehold, are excluded from the denominator of this metric.
3.13 - Grant related to capitalised major repairs expenditure is not netted off in this calculation.
| Measurement of VFM cost chain – economy | Enter value in FVA as |
|---|---|
| [Management costs | Positive |
| + Service charge costs | Positive |
| + Routine maintenance costs | Positive |
| + Planned maintenance costs | Positive |
| + Major repairs expenditure | Positive |
| + Lease costs | Positive |
| + Capitalised major repairs expenditure for period | Positive |
| + Other (social housing letting) costs | Positive |
| + Charges for support services (Operating expenditure) | Positive |
| + Development services (Operating expenditure) | Positive |
| + Community / neighbourhood services (Operating expenditure) | Positive |
| + Other social housing activities: Other (Operating expenditure)] | Positive |
| Divided by | |
| [Total social housing units owned and / or managed at period end: | |
| Social rent general needs housing (excluding Affordable Rent), Affordable Rent general needs housing, social rent supported housing and housing for older people (excluding Affordable Rent), Affordable Rent supported housing and housing for older people, Low-Cost Home Ownership, care homes, other social housing units] | Positive |
Metric 6 – Operating margin %
3.14 - The Operating margin demonstrates the profitability of operating assets before exceptional expenses are taken into account. Increasing margins are one way to improve the financial efficiency of a business. In assessing this ratio, it is important that consideration is given to registered providers’ purpose and objectives (including their social objectives). Consideration should also be given to Supported Housing providers who tend to have lower margins than average.
3.15 - Registered providers will report on two operating margin ratios:
-
A: Operating margin (social housing lettings only)
-
B: Operating margin (overall).
| A - Operating margin (social housing lettings only) % Measurement of VFM cost chain – efficiency |
Enter value in FVA as |
|---|---|
| Operating surplus / (deficit) from social housing lettingsfootnote 2 | Either |
| Divided by | |
| Turnover from social housing lettings | Positive |
| B - Operating margin (overall) % Measurement of VFM cost chain – efficiency |
Enter value in FVA as |
|---|---|
| [Operating surplus / (deficit) (overall) | Either |
| - Gain / (loss) on disposal of fixed assets (housing properties) | Either |
| - Gain / (loss) on disposal of other fixed assets] | Either |
| Divided by | |
| Turnover (overall) | Positive |
Metric 7 – Return on capital employed %
3.16 - The Return on capital employed (ROCE) compares the operating surplus to total assets less current liabilities and is a common measure in the commercial sector to assess the efficient investment of capital resources. The ROCE metric supports registered providers with a wide range of capital investment programmes.
3.17 - In contrast to the operating margin calculations, ROCE includes the gain / (loss) on disposal of fixed assets.
| Measurement of VFM cost chain – efficiency | Enter value in FVA as |
|---|---|
| [Operating surplus / (deficit) (overall) | Either |
| + Share of operating surplus / (deficit) in joint ventures or associates] | Either |
| Divided by | |
| Total assets less current liabilities | Positive |
Annex A: Reference lines to FVA 2026
FVA lines for metric 1 – Reinvestment %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Development of new properties (Total housing properties) | E: notes 1 | 33 | 7 | Positive | |
| + | Newly built properties acquired (Total housing properties) | E: notes 1 | 34 | 7 | Positive |
| + | Works to existing (Total housing properties) | E: notes 1 | 35 | 7 | Positive |
| + | Capitalised interest (Total housing properties) | E: notes 1 | 36 | 7 | Positive |
| + | Schemes completed (Total housing properties)] | E: notes 1 | 37 | 7 | Either |
| Divided by | |||||
| [Tangible fixed assets: Housing properties at cost (Current period) | C: SOFP | 2 | 1 | Positive | |
| OR | Tangible fixed assets: Housing properties at valuation (Current period)] | C: SOFP | 3 | 1 | Positive |
Note on lines used to calculate metric 1: For tangible fixed assets, providers should use the measure agreed in their Statement of Financial Position / Balance Sheet. The figure should be either historic cost or valuation.
FVA lines for metric 2a – New supply delivered (social housing) %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Total social housing units developed, or newly built units acquired in-year (owned): | |||||
| Social rent general needs housing (excluding Affordable rent), Affordable rent general needs housing, social rent supported housing and housing for older people (excluding Affordable rent), Affordable rent supported housing and housing for older people, low-cost home ownership, care homes, other social housing units | E: notes 1 | 10 | 2 | Positive | |
| + | Social leasehold units owned] | E: notes 1 | 16 | 2 | Positive |
| Divided by | |||||
| [Total social housing units owned (Period end) | E: notes 1 | 10 | 6 | Positive | |
| + | Social leasehold units owned (Period end)] | E: notes 1 | 16 | 6 | Positive |
Note on lines used to calculate metric 2a: Line 10 (total social housing units owned) is automatically calculated as the total of the different housing types owned and/or managed entered in lines 1 – 7, less the total managed but not owned in line 9.
FVA lines for metric 2b – New supply delivered (non-social housing) %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Total non-social housing units developed, or newly built units acquired (owned): | |||||
| Total non-social rental housing units owned | E: notes 1 | 13 | 2 | Positive | |
| + | Non-social leasehold units owned | E: notes 1 | 19 | 2 | Positive |
| + | New outright sale units developed or acquired] | E: notes 1 | 22 | 1 | Positive |
| Divided by | |||||
| [Total social and non-social housing units owned (Period end): | |||||
| Total social housing units owned (Period end) | E: notes 1 | 10 | 6 | Positive | |
| + | Total non-social rental housing units owned (Period end) | E: notes 1 | 13 | 6 | Positive |
| + | Social leasehold units owned (Period end) | E: notes 1 | 16 | 6 | Positive |
| + | Non-social leasehold units owned (Period end)] | E: notes 1 | 19 | 6 | Positive |
Note on lines used to calculate metric 2b: The numerator for metric 2b must reflect the FVA lines as set out above. New homes delivered off-balance sheet, for example through joint ventures are excluded from this measure. The denominator for metric 2b must include all social AND non-social housing units owned at the period end.
FVA lines for metric 3 – Gearing %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Short-term debt | C: SOFP | 18 | 1 | Positive | |
| + | Long-term debt | C: SOFP | 25 | 1 | Positive |
| - | Cash and cash equivalents | C: SOFP | 14 | 1 | Positive |
| + | Amounts owed to group undertakings | C: SOFP | 26 | 1 | Positive |
| + | Finance lease obligations] | C: SOFP | 27 | 1 | Positive |
| Divided by | |||||
| [Tangible fixed assets: Housing properties at cost (Current period) | C: SOFP | 2 | 1 | Positive | |
| OR | Tangible fixed assets: Housing properties at valuation (Current period)] | C: SOFP | 3 | 1 | Positive |
Note on lines used to calculate metric 3: For tangible fixed assets, providers should use the measure agreed in their Statement of Financial Position / Balance Sheet. The figure should be either historic cost or valuation.
FVA lines for metric 4 – EBITDA MRI interest cover %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Operating surplus / (deficit) (overall) | B: SOCI | 6 | 1 | Either | |
| - | Gain / (loss) on disposal of fixed assets (housing properties) | B: SOCI | 4 | 1 | Either |
| - | Gain / (loss) on disposal of other fixed assets | B: SOCI | 5 | 1 | Either |
| - | Amortised government grants | D: operating surplus note | 20 | 7 | Positive |
| - | Government grants taken to income | D: operating surplus note | 21 | 7 | Positive |
| + | Interest receivable | B: SOCI | 10 | 1 | Positive |
| - | Capitalised major repairs expenditure for the period | F: notes 2 | 1a | 1 | Positive |
| + | Capitalised major repairs grant received for the period | F: notes 2 | 1b | 1 | Positive |
| + | Total depreciation charge for the period] | F: notes 2 | 2 | 1 | Positive |
| Divided by | |||||
| [Interest capitalised | E: notes 1 | 117 | 1 | Negative | |
| + | Interest payable and financing costs] | B: SOCI | 11 | 1 | Negative |
Notes on lines used to calculate metric 4: The interest capitalised and interest payable lines are entered in the FVA as negative. The total must be converted to positive before using it to divide the numerator total.
FVA lines for metric 5 – Headline social housing cost per unit
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Management costs | D: operating surplus note | 25 | 7 | Positive | |
| + | Service charge costs | D: operating surplus note | 26 | 7 | Positive |
| + | Routine maintenance costs | D: operating surplus note | 27 | 7 | Positive |
| + | Planned maintenance costs | D: operating surplus note | 28 | 7 | Positive |
| + | Major repairs expenditure | D: operating surplus note | 29 | 7 | Positive |
| + | Lease costs | D: operating surplus note | 31 | 7 | Positive |
| + | Capitalised major repairs expenditure for the period | F: notes 2 | 1a | 1 | Positive |
| + | Other (social housing letting) costs | D: operating surplus note | 34 | 7 | Positive |
| + | Charges for support services | D: operating surplus note | 2 | 3 | Positive |
| + | Development services | D: operating surplus note | 3 | 3 | Positive |
| + | Community / neighbourhood services | D: operating surplus note | 4 | 3 | Positive |
| + | Other] | D: operating surplus note | 6 | 3 | Positive |
| Divided by | |||||
| Total social housing units owned and / or managed at period end. | E: notes 1 | 8 | 6 | Positive |
FVA lines for metric 6a – Operating margin (social housing lettings) %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| Operating surplus / (deficit) on social housing lettings | D: operating surplus note | 36 | 7 | Either | |
| Divided by | |||||
| Turnover from social housing lettings | D: operating surplus note | 24 | 7 | Positive |
FVA lines for metric 6b – Operating margin (overall) %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Operating surplus / (deficit) (overall) | B: SOCI | 6 | 1 | Either | |
| - | Gain / (loss) on disposal of fixed assets (housing properties)] | B: SOCI | 4 | 1 | Either |
| - | Gain / (loss) on disposal of other fixed assets] | B: SOCI | 5 | 1 | Either |
| Divided by | |||||
| Turnover (overall)] | B: SOCI | 1 | 1 | Positive |
FVA lines for metric 7 – return on capital employed %
| +/- | FVA 2026 item | FVA 2026 part | FVA 2026 line | FVA 2026 column | Enter value in FVA as |
|---|---|---|---|---|---|
| [Operating surplus / (deficit) (overall)* | B: SOCI | 6 | 1 | Either | |
| + | Share of operating surplus / (deficit) in joint ventures or associates] | B: SOCI | 9 | 1 | Either |
| Divided by | |||||
| Total assets less current liabilities. | C: SOFP | 24 | 1 | Positive |
*including gain / (loss) on disposal of fixed assets
Annex B: Guidance on the VFM metrics reporting for small providers
This part of the guidance should be used by registered providers with a stock holding of fewer than 1,000 units. These providers are not required to submit an electronic copy of the annual accounts (FVA) to the regulator.
This guidance note is intended to help small providers calculate the VFM metrics from their annual accounts (financial statements). The tables on the following pages set out how the metrics should be calculated with reference to specific lines in the accounts
The regulator is aware that not all the VFM metrics will be applicable to every small provider given the diversity of business models across the sector. In the spirit of transparency and accountability, where the value of a VFM metric is calculated as zero, this should be reported as so.
As a reminder, since 2025, providers are required to recognise capitalised major repairs grant received when calculating the EBITDA MRI Interest Cover metric. This is to ensure the calculation reflects both the cost of undertaking capitalised major repairs and any grant funding that is associated with meeting those costs.
The Value for Money Standard requires providers to report on the VFM metrics, including the sub-metrics for new supply and operating margin, within their annual accounts (financial statements). For reporting purposes, providers should discuss and agree the format of their annual accounts with their auditor or their accountant.
| Key to tables | Enter value in FVA as |
|---|---|
| Numerator | The figure(s) above the line in a division calculation |
| Denominator | The figure(s) below the line in a division calculation |
| SORP | Statement of Recommended Practice |
| SOCI | Statement of Comprehensive Income (Housing SORP) |
| SOFP | Statement of Financial Position (Housing SORP) |
| SOFA | Statement of Financial Activities (Charity SORP) - where the location of data differs between the Housing SORP and the Charity SORP, this is shown in square brackets like this: SOCI / [SOFA], SOFP / [BS] |
| BS | Balance Sheet (Charity SORP) |
| Note TOE | Note: Turnover and Operating Expenditure; this note may have different names including Income and Expenditure from social housing lettings |
| Note Creds <1 | Note: Creditors: Amounts falling due within one year |
| Note Creds >1 | Note: Creditors: Amounts falling due after more than one year |
| Units in Management | This may have different names, such as Accommodation in Management |
Accounts lines for metric 1 – Reinvestment %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| [Development of new properties (Total housing properties) | Numerator | Fixed assets note | Positive | |
| + | Newly built properties acquired (Total housing properties) | Numerator | Fixed assets note | Positive |
| + | Works to existing (Total housing properties) | Numerator | Fixed assets note | Positive |
| + | Capitalised interest (Total housing properties) | Numerator | Fixed assets note | Positive |
| + | Schemes completed (Total housing properties)] | Numerator | Fixed assets note | Either |
| Divided by | ||||
| [Tangible fixed assets: Housing properties at cost (Period end) |
Denominator | Fixed assets note | Positive | |
| OR | Tangible fixed assets: Housing properties at valuation (Period end)] |
Denominator | Fixed assets note | Positive |
Notes on lines used to calculate metric 1
- Works to existing (Total housing properties): This should include only those works to existing properties which were capitalised (i.e. added to Fixed Assets in the Statement of Financial Position / Balance Sheet).
- Capitalised interest (Total housing properties): This is sometimes shown in the narrative beneath the Note, rather than as a line in the Note itself.
- Schemes completed (Total housing properties): The net value is often nil.
- Tangible fixed assets: These lines should be Net Book Value, which includes accumulated depreciation. Providers should use the relevant measure (historic cost or valuation) that is used in their Statement of Financial Position / Balance Sheet to calculate the reinvestment metric.
Accounts lines for metric 2a – New supply delivered (social housing) %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| [Total social units (developed or acquired in-year) | Numerator | Note: Units in Management | Positive | |
| + | Social leasehold units (acquired in-year)] | Numerator | Note: Units in Management | Positive |
| Divided by | ||||
| [Total social housing units owned (Period end) | Denominator | Note: Units in Management | Positive | |
| + | Social leasehold units owned (Period end)] | Denominator | Note: Units in Management | Positive |
Notes on lines used to calculate metric 2a
- The units used in the numerator should exclude existing properties transferred from other providers.
- Where a provider develops a unit on behalf of another provider, the new units should only be reported by the provider acquiring (and owning and / or managing the unit).
- These include shared ownership units and other units which are leased to tenants by the provider as social lettings.
- The units used in the both the numerator and the denominator should only include properties owned by the provider.
Accounts lines for metric 2b – New supply delivered (non-social housing%
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| [Total non-social rental housing units owned (acquired in-year) | Numerator | Note: Units in Management | Positive | |
| + | Non-social leasehold units owned (acquired in-year) | Numerator | Note: Units in Management | Positive |
| + | New outright sale units (developed or acquired)] | Numerator | Note: Units in Management | Positive |
| Divided by | ||||
| [Total social housing units owned (Period end) | Denominator | Note: Units in Management | Positive | |
| + | Total non-social rental housing units owned (Period end) | Denominator | Note: Units in Management | Positive |
| + | Social leasehold units owned (Period end) | Denominator | Note: Units in Management | Positive |
| + | Non-social leasehold units owned (Period end)] | Denominator | Note: Units in Management | Positive |
Notes on lines used to calculate metric 2b
- The units used in the numerator should exclude existing properties transferred from other providers.
- Where a provider develops a unit on behalf of another provider, the new units should only be reported by the provider acquiring (and owning and / or managing the unit).
- The units used in the both the numerator and the denominator should only include properties owned by the provider.
Accounts lines for metric 3 – Gearing %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| + | [Short-term debt | Numerator | Note: Creds <1 | Positive |
| + | Long-term debt | Numerator | Note: Creds >1 | Positive |
| - | Cash and Cash equivalents | Numerator | SOFP / [BS] | Positive |
| + | Amounts owed to group undertakings | Numerator | Note: Creds <1 and / or Note: Creds >1 | Positive |
| + | Finance lease obligations] | Numerator | Note: Creds <1 and / or Note: Creds >1 | Positive |
| Divided by | ||||
| [Tangible fixed assets: Housing properties at cost (Period end) | Denominator | Note: Fixed assets | Positive | |
| OR | Tangible fixed assets: Housing properties at valuation (Period end)] | Denominator | Note: Fixed assets | Positive |
Notes on lines used to calculate metric 3
- The short-term debt and long-term debt figures should include ‘Amounts owed to related / connected parties’.
- Tangible fixed assets: These lines should be Net Book Value, which includes accumulated depreciation. Providers should use the relevant measure (historic cost or valuation) that is used in their Statement of Financial Position / Balance Sheet to calculate the reinvestment metric.
Accounts lines for metric 4 – EBITDA MRI interest cover %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| [Operating surplus / (deficit) (overall) | Numerator | SOCI / [SOFA] | Either | |
| - | Gain / (loss) on disposal of fixed assets (housing properties) | Numerator | SOCI / [SOFA] | Either |
| - | Gain / (loss) on disposal of other fixed assets | Numerator | SOCI / [SOFA] | Either |
| - | Amortised government grant | Numerator | Note TOE | Positive |
| - | Government grants taken to income | Numerator | Note TOE | Positive |
| + | Interest receivable | Numerator | SOCI / [SOFA] | Positive |
| - | Capitalised major repairs expenditure for the period | Numerator | Note: Fixed assets | Positive |
| + | Capitalised major repairs grant received for period | Numerator | Note: Fixed assets | Positive |
| + | Total depreciation charge for the period] | Numerator | Note: Fixed assets | Positive |
| Divided by | ||||
| [Interest capitalised | Denominator | Note: Fixed assets (or Note: interest payable) | Negative | |
| + | Interest payable and financing costs] | Denominator | SOCI / [SOFA] | Negative |
Notes on lines used to calculate metric 4
- The gains / (losses) on disposal of housing and other fixed assets should only be deducted if they are included in the operating surplus (overall). If they are shown ‘below the line’ in the accounts, they should not be deducted.
- The capitalised major repairs grant received for period added back should only include grant received in respect of the capitalised major repairs recorded in the line above (capitalised major repairs expenditure for the period). This should exclude grants associated with major repairs expenditure that is treated as a revenue item.
- The total depreciation charge for the period added back should include depreciation for all assets, not just housing properties.
- The interest payable figure should include the financing costs (i.e., interest payable) in respect of defined benefit pension schemes.
- The interest payable and interest capitalised are typically shown as negatives in the accounts. The total must be converted to positive before using it to divide the numerator total.
Accounts lines for metric 5 – Headline social housing cost per unit
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| Management costs | Numerator | Note TOE | Positive | |
| + | Service charge costs | Numerator | Note TOE | Positive |
| + | Routine maintenance costs | Numerator | Note TOE | Positive |
| + | Planned maintenance costs | Numerator | Note TOE | Positive |
| + | Major repairs expenditure | Numerator | Note TOE | Positive |
| + | Lease costs | Numerator | Note TOE | Positive |
| + | Capitalised major repairs expenditure for the period | Numerator | Note Fixed assets | Positive |
| + | Other (social housing letting) costs | Numerator | Note TOE | Positive |
| + | Charges for support services | Numerator | Note TOE | Positive |
| + | Development services | Numerator | Note TOE | Positive |
| + | Community / neighbourhood services | Numerator | Note TOE | Positive |
| + | Other social housing activities: Other | Numerator | Note TOE | Positive |
| Divided by | ||||
| Total social housing units owned and / or managed at period end | Denominator | Note: Units in Management | Positive |
Notes on lines used to calculate metric 5
- Routine maintenance costs - this figure should include Void repairs, if these are disclosed separately).
- The denominator should include properties which are either owned by the provider or managed for others.
Accounts lines for metric 6a – Operating margin (social housing lettings) %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| Operating surplus / (deficit) (social housing lettings) | Numerator | Note TOE | Either | |
| Divided by | ||||
| Turnover from social housing lettings | Denominator | Note TOE | Positive |
Accounts lines for metric 6b – Operating margin (overall) %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| Operating surplus / (deficit) (overall) | Numerator | SOCI / [SOFA] | Either | |
| - | Gain / (loss) on disposal of fixed assets (housing properties) | Numerator | SOCI / [SOFA] | Either |
| - | Gain / (loss) on disposal of other fixed assets | Numerator | SOCI / [SOFA] | Either |
| Divided by | ||||
| Turnover (overall) | Denominator | SOCI / [SOFA] | Positive |
Notes on lines used to calculate metric 6b
- The gains / (losses) on disposal of housing and other fixed assets should only be deducted if they are included in the operating surplus (overall). If they are shown ‘below the line’ in the accounts, they should not be deducted.
Accounts lines for metric 7 – return on capital employed %
| +/- | Line in accounts | Include in | Location in accounts | Shown as |
|---|---|---|---|---|
| Operating surplus / (deficit) (overall) | Numerator | SOCI / [SOFA] | Either | |
| + | Share of operating surplus / (deficit) in joint ventures or associates | Numerator | SOCI / [SOFA] | Either |
| Divided by | ||||
| Total assets less current liabilities | Denominator | SOFP / [BS] | Positive |
1: Providers who own and or manage fewer than 1,000 low-cost rental accommodation and low-cost home ownership units combined (for providers in a group, units are measured at a registered group level). Such providers are termed ‘small providers’ for the purposes of the requirements in this document. ↩
2: Gain / (loss) on disposal of fixed assets must be excluded. ↩