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2020-09-30-accounts

REPORT OF THE TRUSTEES AND FINANCIAL STATEMENTS FOR YEAR ENDED 30 SEPTEMBER 2020

Cockpit Arts (Limited by Guarantee) • Registered Company Number 02801969 • Registered Charity Number 1029643

Contents Page
Reference and administrative information 1
Trustees’ report 2
Independent auditor’s report 18
Statement of financial activities 21
Balance sheet 22
Statement of cash flows 23
Notes to the financial statements 24

Cockpit Arts (Limited by Guarantee) • Registered Company Number 02801969 • Registered Charity Number 1029643

REFERENCE AND ADMINISTRATIVE INFORMATION FOR THE YEAR ENDED 30 SEPTEMBER 2020

Status Governing document

The organisation is a charitable company limited by guarantee, incorporated on 19 March 1993 and registered as a charity on 2 December 1993 in England and Wales.

The company was established under a memorandum of association which established the objects and powers of the charitable company and is governed under its articles of association. The original memorandum and articles of association were replaced by special resolution on 10 December 2009 by new articles of association. The articles of association were replaced by special resolution on 3 April 2019 by new articles of association.

Company number 2801969
Charity number 1029643
Registered office and Cockpit Yard 18-22 Creekside
operational addresses Northington Street Deptford
London WC1N 2NP London SE8 3DZ
Trustees Cornelius Medvei (Chair)
Jill Humphrey (Deputy Chair)
Bill Amberg
Nishita Dewan (Appointed on 20 November 2019)
Samuel Fry
Patricia Godfrey
Clarissa Hulse
Jane Kuria-Ronaldson
Pablo Lloyd (Appointed on 20 November 2019)
David Moore
Sarah Myerscough (Resigned 23 September 2020)
Mehul Nathwani (Appointed on 20 November 2019)
Ben O’Neill
Sarah Samuel (Appointed on 20 November 2019)
Alistair Scott (Appointed on 20 November 2019)
Key management personnel Annie Warburton
Chief Executive and Company Secretary
David Crump, Head of Business Incubation
Hugo Godfrey, Financial Controller
Janice Hosegood, Head of Communication
Bankers NatWest Bank Plc
PO Box 159, 332 High Holborn, London WC1V 7PS
Solicitors Gunnercooke LLP
1 Cornhill London EC3V 3ND
Auditors Haysmacintyre LLP
10 Queen Street Place London EC4R 1AG

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TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

REPORT OF THE TRUSTEES FOR YEAR ENDED 30 SEPTEMBER 2019

Cockpit Arts is London’s leading centre for contemporary craft. We empower makers to succeed creatively and commercially.

Established in 1986, we’re the UK’s largest, most diverse cluster of makers and the country’s only craft business incubator, recognised on the NatWest SE100 index 2020 of top-performing social enterprises.

– Home to 150 makers, practicing in over 20 different disciplines from ceramics to fine jewellery, – handweaving to bespoke tailoring we equip talented people with the tools to succeed: specialist studio space and equipment, in-house business coaching and public showcases. We work with hundreds more makers through careers programmes, outreach, training and consultancy in the UK and internationally.

Creativity, innovation and business success are fuelled by diversity. At Cockpit we foster an inclusive, ambitious culture where all aspects of diversity are seen as fundamental to achievement. Recognising that talent is everywhere but opportunity is not, over three decades our mission has been to break down and overcome the barriers standing in the way of creative success.

Each year we support more than 40 emerging practitioners with awards and bursaries, providing free studio space for 12 months, professional development and training, and introductions to buyers and curators. Funded by City of London Livery Companies, trusts, foundations, individual donors and corporate sponsors, these highly sought-after places provide a grounding for artistic success. Many artists, makers and designers who started out at Cockpit now enjoy a global reputation as leaders in their field.

Providing a vital platform for makers, especially those in their early years, our studios are a destination for local people, collectors, curators, retail buyers, stylists and interior designers, as well as for young people taking their first steps in their craft career. We bring makers’ work to public audiences through showcases and events, and offer bespoke tours for schools, colleges and special interest groups.

As a social enterprise, we generate over 80% of our income through earned revenue, and raise the rest from patrons, trusts, foundations, and sponsors. Our annual impact report, The Cockpit Effect, consistently demonstrates higher than average economic outcomes for Cockpit makers, accompanied by rich social and cultural impact.

OBJECTIVES AND ACTIVITIES

Aims

In accordance with our charitable objects, Cockpit Arts’ aims are to:

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TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Objectives

In meeting these aims, our objectives are to:

Public Benefit

Cockpit Arts pays due regard to the Charity Commission’s public benefit guidance when reviewing our aims and objectives and in planning and making decisions on our future activities.

Activities 2019-20

With our financial year running 1 October to 30 September the impact of the Covid-19 pandemic struck midway through our reporting year. Therefore, activities during the year reflect two different sixmonth periods, pre- and post-pandemic.

In March, we took quick action to manage the impact of Covid-19, our objective being to maintain the viability of Cockpit and avoid redundancies while doing all we could to support the financial sustainability of our 150 studio-holders. Introducing radical discounts to already subsidised studio – fees, we cut fees by 67% April-June 2020 and 55% July September. In addition to financial support, we delivered 30+ workshops equipping makers to build resilience and deliver digitally. Responding to the context, we adapted plans for June and December public events (makers’ major annual incomeearning events) into a digital festival and market. As a result, in Sept. 2020 we ended our financial year with as many makers at our studios as 12 months earlier.

Other priorities delivered during the year included an expansion of our youth and careers programme, writing and implementing an environmental action plan, revising our diversity plan and committing to new diversity objectives, building new national and international partnerships, and developing proposals for refurbishment and expansion of our Deptford site.

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Awards & Studio Holders

With a core mission to break down and overcome the barriers standing in the way of creative success, our coveted Awards and bursaries programme has never been more vital, especially for those in the fragile early stages of their career. These Awards are funded by City of London Livery Companies, trusts, foundations, individual donors and corporate sponsors, without whose generous support we could not offer these opportunities.

This year, we supported 42 practitioners with 44 awards and bursaries, providing free studio space for 12 months, professional development and training, and introductions to buyers and curators. Some Awards, including the Clothworkers’ Award and Leathersellers’ Award, offer multi-year support, as well as studio equipment, to provide as strong a ground as possible for creative and commercial success.

In response to disruptions created by the pandemic, and with the express permission of funders, we extended the terms of Awards for beneficiaries to compensate for time lost during lockdown.

Adhering to Government and health guidance, we kept studios open throughout the year for those unable to relocate their practice off-site. This provided a vital resource enabling makers to keep their practices going.

Despite the pandemic, demand for studios remained robust. Applications for places were up by over 50% year-on-year: we received a total of 196 applications, compared to 129 last year. We had 18 starters, with additional places offered and deferred pending lifting of lockdown.

Business Support Delivery

In the first half of the financial year to March 2020, business support programmes continued as usual. Despite a high level of furlough during the first lockdown, in total we provided 1738 hours of direct support to makers, including vital one-to-one coaching and over 30 workshops, all delivered online. In addition to our standard programme, topics focused on resilience, accessing emergency finance, and building digital marketing, communications and sales skills. This support was vital, particularly in the early months of the pandemic, in supporting makers to respond as positively as possible to the circumstances. The change to digital delivery is positively influencing the way we work with makers in the future, making the best of a blended model of online and in-person support.

During the year, we received formal confirmation of the extension of the ERDF-funded London Creative Network programme, enabling it to run to the end of December 2021

Youth and Careers Programmes

We redoubled our work to attract a larger and more diverse intake of talent and establish a broader range of routes into the creative industries.

Having received 21 applications for our Make It programme for makers aged 25 or under who are currently unemployed or underemployed, we offered places to three makers who took up their studios in early 2020. Make It is an evolution of our previous Creative Careers programme which, by 2019, had supported a total of 26 individuals into employment or self-employment.

As part of the national Discover! Creative Careers initiative, we delivered two careers days, bringing in school groups to discover the range of job opportunities in the creative industries and experience contemporary craft first-hand. Cockpit was one of 500 creative businesses taking part in the week across the UK, but only one of two craft organisations involved. Following the success of the initiative we confirmed our commitment as the lead craft organisation for Digital Discover week 2021.

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Public Events

In the first half of the year, public events continued as usual. We welcomed an audience of over 4000 to our Winter Open Studios events, with several makers reporting their ‘best open studios ever’ for sales. In the first quarter we were already at 76% of our tour target for the year with repeat visits from French college Lycée Renaudeau Cholet, and new visitors including the Korea Arts and Culture Education Service, Arts University Bournemouth, Mawi’Art: Wabanaki Artist Collective from Canada, Canadian Craft Alliance, and participants in the British Council Crafting Futures global programme.

In the summer, unable to run in-person events, we ran our first Cockpit Festival online, with a reach – – of 160K accessing over 65 events talks, demonstrations, workshops featuring more than 80 makers. We followed up in the Autumn with a modest live events programme, including six Covidsafe tours as part of London Craft Week and Bloomsbury Festival, and a partnership with Sipsmith online.

Partnerships, Policy, International Programmes and Consultancy

We continued to foster a wide range of local and national partnerships with cultural, education and enterprise organisations.

In Deptford, Cockpit was proud to support Lewisham’s successful bid for London Borough of Culture 2022. In Holborn, our membership of the Kings Cross Knowledge Quarter led to us to co-produce content with a Central Saint Martins graphic design student for the Knowledge Quarter Zine Playground , distributed to local families.

Building on our strong track record of partnership with the British Council, we were formally brought onto the British Council DICE supplier framework and secured new contracts delivering business and social enterprise support in Indonesia and Karachi, Pakistan.

Cockpit sponsored the University of the Arts London’s Creative Enterprise Awards for the third successive year. We also delivered content as part of Goldsmiths College’s MA Social Enterprise and began development of a new Award and symposium with Central Saint Martins to take place in 2021.

Our CEO represented craft businesses Creative Industries Federation’s Creative Leaders round tables developing policy responses to the pandemic for the creative industries and was one of the arts leaders in Camden advising Leader of the Council Cllr Georgia Gould and Sir Keir Starmer MP on the impact of the pandemic on local creative businesses.

The CEO also continued her work for the Department for Education as Chair of the panel developing the new T-Level (Technical Level) post-GCSE qualification in Craft and Design.

Property

Holborn

In August 2020, Camden Council published a statement that it had ceased negotiations with the developer U+I on the proposed redevelopment of Cockpit Yard. With the position clarified, we began negotiations on renewal of our lease.

Deptford

Seeking to provide more studio and education space and open our building up further to public and local community use, we developed proposals to refurbish and extend our Deptford site. These were put forward in an initial preapplication enquiry that received overall positive feedback; in response to

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that feedback, we revised our longer-term proposals and resubmitted them for consideration in September 2020.

The proposals were also the subject of a £1.2m bid to the Mayor of London’s Good Growth Fund (GGF) Round 3, supported by 36 local and national organisations. Although the bid went through to the final stage, it was not awarded funding as a similar local project had been supported in a previous round and funders were seeking to achieve a balanced portfolio with their investment. Because of the bid’s strength and fit with GGF objectives, the project is one of 14 projects being held in reserve, meaning that funding could be granted if any of the 26 projects that have been approved in principle do not proceed.

During the year, Bellway Homes reworked proposals for Sun Wharf, adjacent to our Deptford site. With expert advice, we responded to those proposals in relation daylight, sunlight and noise in the context of our current and future operations in Deptford. We attended mediation meetings on the proposals convened by Lewisham Council’s planning department and the Sun Wharf team adapted their design to reduce impact on Cockpit’s operations.

In their own words

“I feel incredibly fortunate and grateful to be part of Cockpit Arts during these turbulent times; the support and dedication has been truly inspiring. What we all needed at this time was a calm, pragmatic and quick response, which the team of Cockpit Arts delivered, and in my opinion, they went above and beyond what was expected of them. It was of enormous benefit to have their expertise and knowledge to guide us through this turbulent time.

“For many artists, designers, and makers, our biggest outgoings is the studio rent. To have this reduced for a significant amount of time while we took stock and planned for the year ahead was reassuring and invaluable.” – Richard McVetis, artist-maker

“Aside from the generous licence fee discount offered by Cockpit (that wasn’t offered by many other studios), having a business coach has been a lifesaver. Being a creative entrepreneur can be lonely at the best of times let alone during a pandemic. Having an empathetic and supportive cheerleader has been invaluable.” – Yusuf Osman, leatherworker and founder, Yussico

“Having access to expert guidance from the business incubation team has been such a huge benefit. Before I moved to Cockpit my knowledge of running a business was very little. Having regular mentoring and taking part in the Make It Count workshops has really helped me make progress, and made starting a business so much less overwhelming.” – Eva Dennis, weaver

“Cockpit were immediately responsive to the pandemic and offered a rent discount which made us all heave a huge sigh of relief, and the confidence to believe we could survive. Cockpit have really been inventive about promoting and showing the work of its designer-makers through public engagement online.” - Lush Designs

“I am impressed by Cockpit’s approach to the Covid-19 crisis and have shared it with my GLA colleagues as an example of best practice.” -- Raja Moussaoui, Culture at Risk Officer, Greater London Authority

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ACHIEVEMENTS, PERFORMANCE AND IMPACT

The impact of our work saw us recognised once again as one of the 100 top-performing UK social enterprises, listed on the NatWest SE100 Index 2020. We were also recognised on the Social Enterprise UK Roll Call of Honour for our management through the pandemic year and our CEO was named one of the WISE100 Women in Social Enterprise for her leadership through the crisis.

During the year, we became an accredited London Living Wage Employer and, having been nominated by Lewisham Council, were in the first cohort of providers to successfully achieve accreditation in the Mayor of London’s Workspace Accreditation Pilot.

Monitoring and Evaluation

We monitor and evaluate our economic, social and cultural impact, presenting results in an annual impact report The Cockpit Effect , published online and disseminated to supporters, partners and beneficiaries.

Quantitative data are complemented by qualitative analysis and beneficiary case studies, including six- and twelve-monthly reports on Awardees and Bursary-holders. In addition, partnership programmes, such as London Creative Network and the British Council DICE programme, are independently evaluated.

Impact and Performance

Cockpit delivers public benefit through education, training and employment support, as well as through introducing contemporary craft to public audiences through showcases and events.

We are home to 150 independent creative businesses. In 2019/20, 16% of those were on fully sponsored places, supported by Awards and Bursaries, offering studio space, business coaching and, in some cases, equipment. Makers at Cockpit practice 21 different craft disciplines, with concentrations in jewellery (35%), textiles (20%), ceramics (9%) and leatherwork (9%).

Applications to our studios in the year were up by over 50%: we received a total of 196 applications, compared to 129 last year. We had 18 starters, with additional places offered and deferred pending lifting of lockdown. The rate of leavers was no higher than previous years. As a result, by the end of our financial year in September 2020, we achieved our objective of keeping our community together throughout the pandemic, finishing the year with as many studio holders (150) as we began with in October 2019.

The Cockpit Effect reports on comparative data from studio holders’ two most recent tax years; in the 2021 report, data are drawn from tax years 17/18/18/19 or 19/20. Analysis shows that, for the 65 makers providing more than one year’s data, turnover increased by 11% year-on-year, generating a total revenue (for 150 makers) of £3.5m.

However, this global figure occludes the reality of the challenges posed by the pandemic: the median loss of income (compared to the previous year) due to the pandemic was 70%. Moreover, although 20 makers access small amounts of emergency funding from Arts Council England with Cockpit support, a large proportion of makers fell through the gaps in Government support: 43% were ineligible for the Self Employment Income Support Scheme.

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During the year, Cockpit makers proved themselves to be resilient, adaptable, and determined. Throughout, a sense of community has been strong and never more important. Studios remained open throughout the year, in line with Government guidance and health protocols, for those who were unable to work from home, and this was vital for sustaining their businesses.

In the early stages of the first lockdown, makers came together within Cockpit and in their local communities to provide facemasks and other items of PPE. Once this phase passed, we started to see makers introduce changes in their businesses to adapt to the situation, for example, developing new products, switching to running workshops and events digitally (including during Cockpit Festival), and taking part in the Artist Support Pledge.

Unsurprisingly, compared to previous years, the numbers of additional staff and freelancers employed by Cockpit makers dropped compared to the previous year. The number of makers exporting this year was down to 46%, compared to 55% last year. However, exports remained significant, amounting to nearly 20% of total revenues. At the time of writing, the full effects of Brexit are not known, but are a concern for our makers

Cockpit has always been a diverse community: 20% of Cockpit makers identify as Black, Asian or Minority Ethnic, compared to 4% in the UK craft sector as a whole; 81% are female, compared to 32% in the self-employed UK craft workforce. In this year in which awareness grew of the scale of racial injustice still prevalent in culture and society, we redoubled our commitment to further educating ourselves and dismantling barriers standing in the way of participation in culture.

In terms of public events, although it was impossible to welcome in-person visitors from March onwards, we grew digital audiences by 14%.

Whilst the year has been undoubtedly challenging for Cockpit makers, the growing demand for our services and the results delivered during the year demonstrate that our work to support new talent unlocks to start and grow a successful business is more vital than ever.

Financial Resilience and Fundraising Performance

Through careful financial management, cost control and strong fundraising performance, we steered a course through the pandemic, maintaining the charity’s resilience, and avoiding having to make redundancies, whilst supporting our community of studio holders. To manage risk, we minimised costs, eliminated non-essential expenditure, operated on a skeleton staff, and accessed all Covid-19 response schemes for which we were eligible.

Pre-pandemic, we were in good financial health. In our 2018/19 financial year, ending 30 September 2019, we had achieved our highest annual income to date and were building our reserves. By 1 April 2020, we had grown free reserves to £99,174.

We also accessed the Coronavirus Job Retention Scheme. April to June, 70% of staff were furloughed with minimum staff continuing to work to maintain essential operations. From July 2020 onwards, we operated flexible furlough, balancing financial sustainability with delivery of artist support and public programmes.

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Aside from payroll, our major cost is rent. We applied for and received partial rent relief April-Sept 2020, with a value of £62,625. Although we requested further relief, Camden Council could not offer tenants more support, and we have paid full rent from October 2020.

Together, rent relief and funding enabled us to support studio-holders through substantial discounts to fees. We cut licence fees to 33% of normal levels for April – June and to 45% of normal levels for – July September. Therefore, during the year, income from licence fees, services recharged to beneficiaries and other rental income fell. In addition, from early 2020, income generated from marketing and events (venue hire, exhibition fees, and private tours) dropped and then disappeared.

In previous years, earned and traded income totalled 80% of our turnover and was reinvested back into our workspace provision, business support and employment programmes. As a consequence of the pandemic, this year, the proportion of earned income dropped to 69% and fundraising income rose to 31% of total turnover.

In addition to emergency funding, we were grateful to all the funders who continued their support of our Awards and bursaries which, in turn, enabled us to continue our support to makers through the pandemic, including extending the terms of their Awards to compensate for lost time during lockdown. In total, funding received for Awards and Bursaries enabled us to support 42 makers through 44 Awards.

With partners, having secured a second round of ERDF funding to extend the London Creative Network programme to June 2020 we submitted an application for a third and final round of funding to extend the programme beyond June 2020 to December 2021.

Taking in both regular and emergency funding, we achieved 125% of the fundraising target set at the beginning of the year. Implementing a fundraising strategy focused on long-term and multi-year funding to ensure resilience, by the end of the 2019/20 financial year, we had already secured 69% of our target for the following financial year.

We ended the year with £139,017 free reserves.

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FUTURE PLANS

Priorities and plans for 2020-21:

Craft a long-range strategic plan

We will create a new, five-year strategic plan, consolidating and building on successes to date. We will appraise our business model and develop our offer to optimise economic, cultural and social impact.

Extend opportunities to a wider range of makers

We will continue to extend our services to a wider range of makers, including those operating outside our studio premises, through new partnerships, the ERDF-funded London Creative Network programme, consultancy, and international delivery under the British Council’s DICE initiative. We will aim to support a wider set of types of craft practice, including those focused on sustainability and experimental work.

Encourage future makers

Building on the growth of our careers and youth programmes in 2019-20, we will step up our work opening routes into craft careers for young people through our Make It programme aimed at 18-25year-olds starting up in business.

We will continue to contribute to the national Discover Creative Careers programme through hosting immersive careers events for local school students and develop new community- and youth-focused programmes.

We will support development routes into craft through offering funded Apprenticeships, and in chairing the Department for Education’s expert panel writing the Craft and Design T-level (Technical Level) post-GCSE qualification.

Reach wider public audiences

Harnessing the opportunity afforded by digital technology, we will continue to grow our public audiences to bring high-quality craft to a greater number and more diverse range of people. We specifically intend to raise funds to invest in improving our digital offer.

Once Covid-19 restrictions are lifted, and it is safe to do so, we will resume our programme of inperson events, talks, showcases, and exhibitions.

Developing our national and international profile, and strengthening both existing and new partnerships, we will consolidate our position as the leading voice for contemporary craft in London, reaching new audiences and generating opportunities for the makers we support.

Open up opportunity and promote diversity and inclusion

We will continue to implement our updated inclusion and diversity plan, and monitor its impact, working to improve diversity across all dimensions and in all activity areas: Board, staff, studio holders, training delivery and audience.

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Implement a revised environmental sustainability plan

Building on plans drawn up in 2019, we will review our environmental policy and targets, agree new targets and implement a new plan.

Measure and communicate impact

We will continue our commitment to impact measurement and to communicating our social, economic – and artistic results through events, publications, and online complementing rigorous quantitative data with case studies that reveal the rich stories behind our work.

Invest in staff and Board development

In 2020-21, we will recruit a new Chair of Trustees to succeed Cornelius Medvei who is due to complete his third and final term as Chair in 2021. Following their appointment, we will conduct a review of Board sub-committees and establish new committees as needed. We will continue to invest in staff development to achieve our organisational objectives.

Secure long-term resilience

We will continue to respond to the Covid pandemic ensuring the safety, health and financial resilience of the charity and our beneficiaries.

We will negotiate a new lease for our Bloomsbury site with London Borough of Camden.

In Deptford, having become sole owners of the Drake House freehold in 2019-20 with completion of our mortgage repayment, we will embark on a fundraising campaign to redevelop and open up the building to the public, expanding studio provision and creating new community spaces.

We will implement a new, long-term fundraising and revenue generation strategy, diversifying our funding base to further strengthen resilience and our ability to deliver our social and cultural mission.

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TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

LEGAL STRUCTURE, GOVERNANCE AND MANAGEMENT

Governing document

Cockpit Arts was established as a charitable company limited by guarantee in 1993. The company was established under a Memorandum of Association, stating the objects and powers of the charitable company, and is governed and administered in accordance with its Articles of Association.

Members of the charity guarantee to contribute an amount not exceeding £1 to the assets of the charity in the event of winding up. The total number of such guarantees at 30 September 2020 was 14 (2019: 10). The Trustees are members of the charity, but this entitles them only to voting rights.

A trading arm, Cockpit Arts & Exhibitions Ltd, is a dormant limited company with no accounting transactions at present.

Trustee recruitment, appointment and induction

The Board of Trustees comprises individuals who are both trustees and non-executive directors of the company. Trustees serve for three years and are eligible for re-election for up to two further terms of three years each. All members of the Board serve in an individual capacity with a duty to support Cockpit Arts rather than to act as representatives of a particular interest group.

Trustees are recruited through an open process. Vacancies are advertised widely, with an emphasis on recruiting from a diverse range of backgrounds to meet the organisation’s skills and knowledge needs. Applications are shortlisted by the Nominations Committee, which comprises the Chair, two Trustees and the CEO. Following interview of shortlisted candidates, recommendations for appointment are proposed to the full Board for their consideration and approval.

Following a wide recruitment campaign in autumn 2019, we received 28 applications from individuals seeking to join the Board. Following interviews in October, we invited five new Trustees onto the Board, who joined formally in November 2019. In summer 2020, we began recruitment for a new Chair to succeed Cornelius Medvei when he steps down in April 2021. received a strong set of applications for the new Chair of Trustees. Following shortlisting by the nominations committee, chaired by Trustee Jill Humphrey, seven candidates went forward for first interview in September. Final interviews took place in the new, 2020/21 financial year.

On appointment, Trustees receive an induction pack comprising the governing documents, most recent annual report, recent performance reports, strategic planning documents, corporate policies, impact reports and any other relevant materials. They are also provided with up-to-date materials on charity governance, including Charity Commission guidance, the Charity Governance Code, and Cultural Governance Alliance material. New Trustees meet with staff to understand their roles in the organisation and are invited to attend Cockpit Arts events. Opportunities for Trustee training are provided, and all Trustees take part in an annual Away Day as well as quarterly Board meetings.

Management and decision-making

Trustees are responsible for making decisions on Cockpit Arts’ long-term direction and activities, and for ensuring that all Board responsibilities delegated to staff are carried out.

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An annual business plan sets out how the charity’s activities will deliver its aims and objectives, within the context of a longer-range, five-year strategic plan.

Trustee sub-committees provide detailed analysis and recommendations on specific activity areas. These are currently the Audit & Risk Committee (which meets five times a year), Fundraising Committee and Nominations Committee. Other sub-committees and working groups, for example on property matters, are convened where required. Committee members and Chairs are appointed by the Chair of the Board of Trustees and approved by the Board.

Executive team

The Board appoints a Chief Executive to shape Cockpit Arts’ strategic direction and lead the organisation. The Chief Executive formally reports on progress to the full Board every quarter, as well as to Board subcommittees.

Staff remuneration is subject, in most cases, to an annual inflationary review, with any additional pay increase dependent on change of role scope or responsibility. Recommendations on remuneration made by the Audit & Risk Committee are subject to approval by the full Board of Trustees.

RISK MANAGEMENT

The Trustees meet regularly to review the financial position and to ensure that effective management and controls are in place. The Audit and Risk Committee and the Board of Trustees each review the charity’s risk register quarterly. Attending to all risk categories (strategic, operational, legal, reputational), they monitor risk status (probability, impact and proximity) and take action to manage each risk as appropriate (mitigate, transfer, accept, avoid or exploit).

Principal risks identified in relation to the charity’s finances are the risk of generating insufficient fundraising income and the risk of premises in Camden becoming unaffordable. Trustees have ensured that there are sufficient reserves to meet all the charity’s immediate liabilities and to continue to do so in the short term.

To mitigate the risk of a fundraising shortfall, the charity has diversified earned and traded income and has implemented a new fundraising strategy. Actively cultivating new funding sources, this strategy harnesses our strong track record of successfully delivering programmes to meet funders’ objectives.

With our landlord, Camden Council’s formal withdrawal from negotiations on redevelopment of the Cockpit Yard site in August 2020, the risk of disruption at our Holborn site has diminished. The charity is in regular communication with property officers at the Council to negotiate an affordable, and longer-term lease on the premises.

Since the outbreak of Covid-19 in March 2020, Trustees have regularly reviewed new risks arising from the pandemic and have taken steps to mitigate their impact.

The principal risks have related to health and finances. Health: additional hygiene measures were introduced in our buildings in February 2020 and guidance was issued to all studio holders to reduce the risk of transmission of the coronavirus. All Cockpit employees began working from home a week before the UK Government’s lockdown and new home working protocols and guidance were introduced. Back-up plans were put in place to prepare for the eventuality that one or more Cockpit staff should fall ill. During the course of the pandemic, as Government guidance has evolved, Cockpit has regularly reviewed its practice and updated guidance to staff and studio-holders accordingly.

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TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

An emergency group of Trustees was convened in immediate response to the pandemic, meeting initially several times a week, then weekly, to review the potential financial impact on Cockpit Arts. Potential loss of income was identified, and detailed cash flow forecasts produced, based on different scenarios to ensure that Cockpit Arts manages its finances effectively through the crisis and beyond. All inessential costs were eliminated from the business; regular analyses of Government and other support schemes were carried out; staff were furloughed (on full pay); and an active fundraising strategy was implemented.

Careful financial management and fundraising through the crisis has enabled Cockpit to extend considerable support to its beneficiaries whilst preserve the charity’s long-term financial sustainability.

FINANCIAL REVIEW

Income

Total income for the year 2019/20 was £904,686, compared with £1,019,992 in the previous year.

During the year £57,249 was received from the European Regional Development Fund for the London Creative Network Programme. Managed by SPACE, with Cockpit Arts, Four Corners and Photofusion as delivery partners, the programme funds business support provision to resident studio holders and external makers. The first edition of the programme began in January 2016. Funding for second phase was awarded in December 2018; delivery began in January 2019 and concluded in June 2020. Negotiations are in place for a third, and final, phase of the programme to begin in 2020/21.

We received income from the British Council to deliver two international creative and social value programmes in Pakistan and Indonesia as part of the DICE programme; and from the Department for Education to contribute towards time spent chairing the industry panel developing the T-Level in Craft and Design.

Reflecting the discounts that we extended to studio holders from April 2020 onwards (67% discounts – – in April June, 55% discounts July September) licence fee income for the year was considerably below that of the previous year. Income from venue hire, tours, and open studios events was, due to the restrictions of lockdowns, lower than previous years.

Cockpit again received generous support from charitable trusts and foundations, enabling us to offer bursaries and awards to talented craftspeople to develop their careers. We are grateful to The Clothworkers’ Company, The Worshipful Company of Leathersellers, The Haberdashers’ Company, The Worshipful Company of Turners, The Worshipful Company of Woolmen and The Arts Society, and for their continued support of Awards and Bursaries for individual craftspeople in specific craft disciplines.

We are also grateful to SHA Trust for continuing their support of The Cockpit Arts Rosalind Stracey Ceramic Residency, and to Marsh Christian Trust and the Worshipful Company of Curriers for their contribution towards core costs.

We were grateful to receive Covid-19 emergency funding from London Borough of Lewisham, the Creative Workspace Resilience Fund, managed by the Creative Land Trust; and the Emergency Response Fund from Arts Council England.

During the year, we received support for new specialist Awards for craftspeople from Texselect, Harriet’s Trust, Newby Trust, CAPITB Trust, The Golsoncott Foundation, The Worshipful Company

14

TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

of Basketmakers, and The Worshipful Company of Feltmakers. We are grateful to them all for their generous support.

In support of our youth programmes, we are grateful to the John S Cohen Foundation for their support of our careers and schools programmes and to the Sir William Boreman’s Foundation for their support of a young person living in the borough of Greenwich or Lewisham to take up an Apprenticeship on our Creative Employment Programme.

We are grateful to corporate sponsor, Clear Insurance Management Ltd, for their continued support of the annual Cockpit Arts / Clear Insurance Award, and from local businesses La Fromagerie, Persephone Books and Waitrose for in-kind support.

– We are also grateful to our many individual donors our Patrons, Champions and Fans - who donated funds in support of our work. Donations from individual donors, including donations made at Open Studios, totalled £18,426.

Cockpit Arts is registered with the Fundraising Regulator and abides by the Regulator’s Code of Fundraising Practice.

Expenditure

Total expenditure in the year was £838,282 compared with last year’s expenditure of £942,109. Funds spent on business support programmes were £361,155, compared with £407,927 in the previous year.

Movement in funds

Net income was £66,404 for the year ended 30 September 2020. There is a surplus for the year on unrestricted funds of £59,210.

RESERVES POLICY

The charity’s reserves policy is to build free reserves equivalent to three months’ running costs. This policy was reviewed and approved by Trustees during the year ended 30 September 2019 and remains current.

Free reserves at 30 September 2020 are £139,017 and 3 months of unrestricted expenditure at 30 September 2020 is £156,719. The difference of £17,702 between the actual and target is the lowest difference to date and Cockpit Arts looks to reduce the difference further.

The charity currently holds the following reserves:

General unrestricted funds 538,212
Restricted funds 1,029,830
------------------
£1,568,042
=========

15

TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

STATEMENT OF TRUSTEES RESPONSIBILITIES

The trustees who served during the year were:

Cornelius Medvei (Chair) Jill Humphrey (Deputy Chair) Bill Amberg Nishita Dewan (Appointed on 20 November 2019) Samuel Fry Patricia Godfrey Clarissa Hulse Jane Kuria-Ronaldson Pablo Lloyd (Appointed on 20 November 2019) David Moore Sarah Myerscough (Resigned 23 September 2020) Mehul Nathwani (Appointed on 20 November 2019) Ben O’Neill Sarah Samuel (Appointed on 20 November 2019) Alistair Scott (Appointed on 20 November 2019)

The trustees, who are also directors of Cockpit Arts for the purposes of company law, are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the trustees to prepare financial statements for each financial year that give a true and fair view of the state of the affairs of the charitable company and of the income and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements the trustees are required to:

The trustees are also responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

16

TRUSTEES’ REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

STATEMENT OF TRUSTEES RESPONSIBILITIES (Cont.)

So far as the trustees are aware:

Approved by the trustees on 07 April 2021 and signed on their behalf by:

Cornelius Medvei Chair of Trustees

17

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Opinion

We have audited the financial statements of Cockpit Arts for the year ended 30 September 2020 which comprise the Statement of Financial Activities, the Charitable Company Balance Sheet, the Charitable Company Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement set out on pages 13 and 14, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

18

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Trustees’ Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Annual Report (which incorporates the strategic report and the directors’ report).

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

19

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2020

Use of our report

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Siobhan Holmes (Senior Statutory Auditor)

Date: 08 April 2021

For and on behalf of Haysmacintyre LLP, Statutory Auditors 10 Queen Street Place London, EC4R 1AG

20

STATEMENT OF FINANCIAL ACTIVITIES

(Incorporating an Income and Expenditure Account)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

Notes Restricted Unrestricted Total Total
funds Funds 2020 2019
£ £ £ £
Income and Expenditure
Income from:
Donations
Fundraising - 18,425 18,425 19,858
Marketing and events - 39,455 39,455 64,276
General grants 2 67,426 25,000 92,426 -
Government grants - 67,853 67,853 -
Charitable activities
Provision of workspace 3 - 513,593 513,593 697,137
Business support programmes 4 151,174 21,175 172,349 237,642
Investment income - 585 585 1,079
--------------------- ------------------ --------------------- ---------------------
Total income 218,600 686,086 904,686 1,019,992
--------------------- ------------------ --------------------- ---------------------
Expenditure on:
Raising funds
Fundraising - 21,014 21,014 21,169
Marketing and events - 58,608 58,608 72,111
Charitable activities
Provision of workspace 18,267 379,238 397,505 440,902
Business support programmes 193,139 168,016 361,155 407,927
--------------------- ------------------ --------------------- ---------------------
Total expenditure 5 211,406 626,876 838,282 942,109
--------------------- ------------------ --------------------- ---------------------
Net income/(expenditure) and
movement in funds 7,194 59,210 66,404 77,883
--------------------- ------------------ --------------------- ---------------------
Reconciliation of funds
Total funds brought forward 1,022,636 479,002 1,501,638 1,423,755
-------------------- ------------------ --------------------- ---------------------
Total funds carried forward 1,029,830 538,212 1,568,042 1,501,638
========= ======== ========= =========

All of the above results are derived from continuing activities. There were no other recognised gains or losses other than those stated above. The accompanying notes form an integral part of these financial statements.

Movements in funds are disclosed in Note 14 to the financial statements.

Full comparative figures for the year ended 30 September 2019 are shown in note 18.

21

BALANCE SHEET

AT 30 SEPTEMBER 2020

Registered company number: 02801969

2020 2019
Notes £ £ £ £
FIXED ASSETS 9 1,327,295 1,358,310
------------------ ------------------
CURRENT ASSETS
Debtors 10 71,401 87,809
Cash at bank and in hand 446,689 367,014
--------------- ---------------
518,090 454,823
Creditors: amounts falling due
within one year 11 (227,343) (308,280)
---------------- ----------------
NET CURRENT ASSETS 290,747 146,543
---------------- ----------------
TOTAL ASSETS LESS CURRENT
LIABILITIES 1,618,042 1,504,853
Creditors: amounts falling due after
more than one year 12 (50,000) (3,215)
------------------ ------------------
NET ASSETS 13 1,568,042 1,501,638
========= =========
RESERVES
Unrestricted funds 14 538,212 479,002
Restricted funds 14 1,029,830 1,022,636
------------------ ------------------
1,568,042 1,501,638
========= =========

The financial statements were approved and authorised for issue by the trustees on 07 April 2021 and signed on their behalf by:

Chair of Trustees Cornelius Medvei

Chair of Audit and Risk Committee Pablo Lloyd

The accompanying notes form an integral part of these financial statements.

22

CASH FLOW STATEMENT

FOR THE YEAR ENDED 30 SEPTEMBER 2020

2020 2019
Notes
£		 £
CASH FLOWS FROM OPERATING ACTIVITIES A 63,745 148,409
CASH FLOWS FROM INVESTING ACTIVITES
Interest paid (409) (1,390)
Interest received 585 672
------------------- -------------------
Cash provided/(used in) investing activities 176 (718)
------------------- -------------------
Increase in /(repayment of) borrowings 15,754 (50,861)
------------------- -------------------
Net cash provided by/ (used in) financing activities 15,754 (50,861)
------------------- -------------------
INCREASE/ (DECREASE) IN CASH IN THE YEAR 79,675 96,830
========= =========
Cash and cash equivalents at the beginning of the year 367,014 270,184
========= =========
TOTAL CASH AND CASH EQUIVALENTS AT THE END OF
THE YEAR 446,689 367,014
========= ========
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
A.
RECONCILIATION OF NET INCOME TO NET		 2020 2019
CASH FLOW FROM OPERATING ACTIVITIES £ £
Net income/(expenditure) 66,405 77,883
Depreciation charge 31,015 31,015
(Increase)/Decrease in debtors 16,408 30,206
(Decrease)/Increase in creditors (49,907) 8,587
Interest payable 409 1,390
Interest received (585) (672)
-------------------- --------------------
Net cash generated by operating activities 63,745 148,409
========= ========

23

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 SEPTEMBER 2020

1. PRINCIPAL ACCOUNTING POLICIES

Basis of Preparation

Statement of compliance

The financial statements are prepared under the historical cost convention. The format of the financial statements has been presented to comply with the Companies Act 2006, FRS102 The Financial Reporting Standard applicable in the UK and Ireland and the Statement of Recommended Practice Accounting and Reporting by Charities (“SORP 2019”). The Charity is a Public Benefit Entity as defined by FRS102.

General information

The Charity is a company limited by guarantee, incorporated in England and Wales (company number: 2801969) and a charity registered in England and Wales (charity number: 1029643). The Charity’s registered office address is: Cockpit Yard, Northington Street, London, WC1N 2NP.

Going concern

The Trustees consider that there are no material uncertainties which would cast doubt on the Charity’s ability to continue as a going concern. The Trustees have considered the continued impact of the COVID-19 virus on the going concern basis given the likely cash flow impact of operations 12 months from the date of signing this report.

Significant judgments and sources estimation uncertainty

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Charity’s accounting policies. The key judgements that have been applied by management relate to the depreciation of fixed assets.

The following principal accounting policies have been applied:

Exemption from group accounts

The financial statements present information about the charity as an individual undertaking and not about its group. The charity has a wholly owned subsidiary, Cockpit Arts and Exhibitions Limited, which is dormant and has been since incorporation (note 17). It is not considered necessary to prepare group accounts as the results of the subsidiary are immaterial to the group.

Donations

Donations and gifts are included in the statement of financial activities when receivable. Gifts in kind are recognised at the charity’s best estimate of the cost of acquiring this gift on the open market. Volunteer time is not included in the financial statements.

Fee income

Fee income represents licence fees charged to designer-makers for studio rental in Holborn and Deptford. This is recognised on an accruals basis. Services recharged to licencees comprise business support fees, metered electricity and office services such as photocopying and fax charges.

24

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

1. PRINCIPAL ACCOUNTING POLICIES (continued)

Grant income

Grants are recognised in full in the statement of financial activities in the year in which they are receivable.

Grants for the purchase of fixed assets are credited to restricted income when available. Depreciation of fixed assets purchased with such grants is charged against the restricted fund. Where a fixed asset is donated to the charity for its own use, it is treated in a similar way to a restricted grant.

Support costs comprise the costs of office administration and other central functions which enable the charity to carry out its educational activities.

Expenditure

Expenditure is recognised in the period in which it is incurred.

Expenditure is allocated to the particular activity where the cost relates directly to that activity. However, the cost of overall direction and administration of each activity, comprising the salary and overhead costs of the central function, is apportioned on the following basis which are an estimate, based on staff costs, of the amount attributable to each activity.

vity.
General Resources Support Costs
(note 4)
Fundraising 3% 4%
Marketing and events 6% 8%
Provision of workspaces 36% 46%
Business support programmes 33% 41%
Support costs 21% -
Governance 1% 1%

Governance costs include compliance with constitutional and statutory requirements incurred by the charitable company.

Expenditure on raising funds relate to the costs incurred by the charitable company in raising funds for the charitable work.

25

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

1. PRINCIPAL ACCOUNTING POLICIES (continued)

Fixed assets

Depreciation is provided at rates calculated to write down the cost of each asset to its estimated residual value over its expected useful life. The depreciation rates in use are as follows:

Freehold property (excluding land) 50 years straight line Leasehold improvements over period of lease Office furniture and equipment 25% per annum straight line

Items of equipment are capitalised where the purchase price exceeds £5,000. Depreciation costs are allocated to activities on the basis of the use of the related assets in those activities. Assets are reviewed for impairment if circumstances indicate their carrying value may exceed their net realisable value and value in use.

Financial instruments

Basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable are accounted for on the following basis:

Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits held at banks, other shortterm highly liquid investments with original maturities of three months or less and bank overdrafts. Bank overdrafts, when applicable, are shown within current liabilities.

Debtors and creditors

Debtors and creditors are measured at the transaction price less any provision for impairment. Any losses arising from impairment are recognised as expenditure.

Bank borrowings

Liabilities for borrowings which are subject to a market rate of interest are measured at the value of the amount advanced, less capital repayments.

Funds

Restricted funds are to be used for specific purposes as laid down by the donor. Expenditure which meets these criteria is charged to the fund together with a fair allocation of management and support costs.

Unrestricted funds are donations and other income receivable or generated for the general objects of the charity.

26

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

1. PRINCIPAL ACCOUNTING POLICIES (continued)

Operating leases

Rentals payable under operating leases, where substantially all the risks and rewards of the ownership remain with the lessor, are charged to the statement of financial activities in the year in which they fall due.

Pension

The charity operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the charity in an independently administered fund. The pension cost charge represents contributions payable under the scheme by the charity to the fund. The charity has no liability under the scheme other than for the payment of those contributions.

Employee benefits

Short term benefits including holiday pay are recognised as an expense in the period in which the service is received.

27

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

2. GENERAL GRANTS Restricted Unrestricted Total Total
funds funds 2020 2019
£ £ £ £
Creative Land Trust 35,995 - 35,995 -
Arts Council England 31,431 - 31,431 -
London Borough of Lewisham - 25,000 25,000 -
---------------- ---------------- ------------------ ------------------
67,426 25,000 92,426 -
======== ======== ======== =========
3. PROVISION OF WORKSPACE Restricted Unrestricted Total Total
funds funds 2020 2019
£ £ £ £
Licence fees - 422,868 422,868 587,710
Services recharged to licencees - 55,188 55,188 67,694
Other rental income - 35,537 35,537 41,733
---------------- ---------------- ------------------ ------------------
- 513,593 513,593 697,137
======== ======== ======== =========
Prior year comparative
Restricted Unrestricted Total Total
funds funds 2019 2018
£ £ £ £
Licence fees - 587,710 587,710 586,773
Services recharged to licencees - 67,694 67,694 67,157
Other rental income - 41,733 41,733 40,459
---------------- ---------------- ------------------ ------------------
- 697,137 697,137 694,389
======== ======== ======== =========

28

NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 30 SEPTEMBER 2020

  1. BUSINESS SUPPORT PROGRAMMES
BUSINESS SUPPORT PROGRAMMES
Restricted Unrestricted Total Total
Funds Funds 2020 2019
£ £ £ £
European Regional Development
Fund (ERDF) 57,249 - 57,249 88,912
Clear Insurance Management Ltd - - - 2,500
The Haberdashers’ Company 10,000 - 10,000 10,000
John S Cohen Foundation 5,000 - 5,000 -
The Worshipful Company of
Leathersellers 21,750 - 21,750 22,000
The Clothworkers’ Foundation - - - 30,000
Weston Jerwood Creative
Bursaries - - - 2,253
Jill Humphrey Springboard Prize 6,000 - 6,000 1,700
The Arts Society 3,000 - 3,000 6,000
Newby Trust 8,000 - 8,000 8,000
Sir William Boreman Trust - - - 5,000
Worshipful Company of
Basketmakers 8,000 - 8,000 4,000
Texselect 24,300 - 24,300 -
Worshipful Company of Feltmakers - - - 5,000
Arts Council England - - - 10,624
Worshipful Company of Turners 875 - 875 7,000
Worshipful company of Woolmen - - - 1,000
Harriet’s Trust 3,000 - 3,000 5,000
CAPITB Trust 4,000 - 4,000 -
SHA Trust - - - 5,000
Worshipful Company of Curriers - 1,000 1,000 -
Golonscott Foundation - 500 500 1,000
Consultancy Income and Fees
Charged - 19,675 19,675 22,653
--------------- ----------------- --------------- ---------------
151,174 21,175 172,349 237,642
======= ======= ======= =========

29

NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 30 SEPTEMBER 2020

4. BUSINESS SUPPORT PROGRAMMES
(continued) Restricted Unrestricted Total Total
Funds Funds 2019 2018
£ £ £ £
Prior year comparative
European Regional Development
Fund (ERDF) 88,912 - 88,912 93,668
Clear Insurance Management Ltd 2,500 - 2,500 2,500
The Haberdashers’ Company 10,000 - 10,000 10,000
John S Cohen Foundation - - - 5,000
The Worshipful Company of
Leathersellers 22,000 - 22,000 21,000
The Clothworkers’ Foundation 30,000 - 30,000 -
Weston Jerwood Creative
Bursaries 2,253 - 2,253 12,766
Jill Humphrey Springboard Prize 1,700 - 1,700 1,000
The Arts Society 6,000 - 6,000 3,000
Newby Trust 8,000 - 8,000 -
Sir William Boreman Trust 5,000 - 5,000 -
Worshipful
Company		 of
Basketmakers 4,000 - 4,000 -
Worshipful
Company		 of
Feltmakers 5,000 - 5,000 -
Arts Council England 1,190 9,434 10,624 5,000
Harriet’s Trust 5,000 - 5,000 -
Radcliffe Trust - - - 3,000
SHA Trust 5,000 - 5,000 5,000
Worshipful Company of Turners 7,000 - 7,000 -
Worshipful company of Woolmen 1,000 - 1,000 -
Golonscott Foundation - 1,000 1,000
Consultancy Income and Fees
Charged - 22,653 22,653 865
--------------- ----------------- --------------- ---------------
204,555 33,087 237,642 162,799
======= ======= ======= =========

30

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

5. TOTAL EXPENDITURE Business
Fundraising Marketing Provision of support 2020 2019
expenses & events workspace programmes Support Governance Total Total
£ £ £ £ £ £ £ £
Staff costs (note 6) 12,402 24,804 148,826 136,424 86,815 4,134 413,405 406,405
Rent and rates - - 70,233 64,381 - - 134,614 195,362
Repairs and maintenance - - 35,496 32,538 - - 68,034 90,451
Utilities - - 19,501 17,875 - - 37,376 34,939
Insurance 397 794 4,763 4,366 2,778 132 13,230 16,021
Bad debts - - 456 - - - 456 -
Depreciation - - 31,015 - - - 31,015 31,015
Legal and professional
fees 557 1,113 6,679 6,123 3,897 186 18,555 6,245
Bank interest - - 409 - - - 409 1,390
Audit fees - - - - - 11,000 11,000 9,600
Project expenses - 18,996 5,140 32,120 - - 56,256 74,735
General expenses 445 890 5,337 4,893 3,114 148 14,827 23,321
Office expenses–general 660 1,319 7,916 7,256 4,617 220 21,988 26,859
- Telephones - - - - - - - 5,375
- Stationery 79 158 946 868 552 26 2,629 3,280
- Sundry admin 170 341 2,044 1,874 1,192 57 5,678 5,696
- Unreclaimable VAT 264 529 3,172 2,907 1,850 88 8,810 11,415
--------------- -------------- --------------- ----------------- ----------------- ---------------- ------------------ ------------------
Carried forward 14,974 48,944 341,933 311,625 104,815 15,991 838,282 942,109

31

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

5. TOTAL EXPENDITURE (continued) Business
Fundraising Marketing Provision of support 2020 2019
expenses & events workspace programmes Support Governance Total Total
£ £ £ £ £ £ £ £
Brought forward 14,974 48,944 341,933 311,625 104,815 15,991 838,282 942,109
Split support costs 6,040 9,664 55,572 49,530 (104,815) (15,991) - -
-------------- ---------------- ------------------ ----------------- ----------------- ---------------- ------------------ ------------------
21,014 58,608 397,505 361,155 - - 838,282 942,109
======= ======= ========= ======== ======== ======= ========= =========
Costs split 3% 6% 36% 33% 21% 1% 100% 100%
Support costs split 5% 8% 46% 41% -100% -100% - -
========= ========= ========= ======== ======== ======= ========= ========

32

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

5. TOTAL EXPENDITURE (continued)

Prior year comparative

Prior year comparative
Business
Fundraising Marketing Provision of support 2019 2018
expenses & events workspace programmes Support Governance Total Total
£ £ £ £ £ £ £ £
Staff costs (note 6) 12,192 24,384 146,306 134,114 85,345 4,064 406,405 382,916
Rent and rates - - 101,928 93,434 - - 195,362 188,898
Repairs and maintenance - - 47,192 43,259 - - 90,451 89,710
Utilities - - 18,229 16,710 - - 34,939 38,903
Insurance 481 961 5,768 5,287 3,364 160 16,021 16,326
Bad debts - - - - - - - 383
Depreciation - - 31,015 - - - 31,015 31,015
Legal and professional
fees 187 375 2,249 2,061 1,311 62 6,245 42,186
Bank interest - - 1,390 - - - 1,390 2,057
Audit fees - - - - - 9,600 9,600 8,900
Project expenses - 32,184 4,003 38,548 - - 74,735 93,253
General expenses 700 1,399 8,396 7,696 4,897 233 23,321 23,330
Office expenses–general 806 1,612 9,669 8,863 5,640 269 26,859 24,135
- Telephones 161 323 1,934 1,774 1,129 54 5,375 5,679
- Stationery 98 197 1,181 1,082 689 33 3,280 3,265
- Sundry admin 171 342 2,050 1,880 1,196 57 5,696 6,744
- Unreclaimable VAT 342 685 4,110 3,767 2,397 114 11,415 16,065
--------------- -------------- --------------- ----------------- ----------------- ---------------- ------------------ ------------------
Carried forward 15,138 62,462 385,420 358,475 105,968 14,646 942,109 973,765

33

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

5. TOTAL EXPENDITURE (continued)

Prior year comparative

Business
Fundraising Marketing Provision of support 2019 2018
expenses & events workspace programmes Support Governance Total Total
£ £ £ £ £ £ £ £
Brought forward 15,138 62,462 385,420 358,475 105,968 14,646 942,109 973,765
Split support costs 6,031 9,649 55,482 49,452 (105,968) (14,646) - -
-------------- ---------------- ------------------ ----------------- ----------------- ---------------- ------------------ ------------------
21,169 72,111 440,902 407,927 - - 942,109 973,765
======= ======= ========= ======== ======== ======= ========= ========
Costs split 3% 6% 36% 33% 21% 1% 100% 100%
Support costs split 5% 8% 46% 41% -100% -100% - -
========= ========= ========= ======== ======== ======= ========= ========

34

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

6. NET INCOME/(EXPENDITURE) 2020 2019
£ £
This is stated after charging:
Interest payable 409 1,390
Depreciation 31,015 31,015
Trustees’ indemnity insurance 1,088 1,527
Trustees’ remuneration - -
Trustees’ reimbursed expenses - -
Auditors’ remuneration:
- audit 10,500 9,000
- additional work 500 600
Operating lease rentals:
- property 167,000 167,000
======== =========
7. STAFF COSTS AND NUMBERS 2020 2019
£ £
Staff costs were as follows:
Salaries and wages 365,803 357,753
Employer national insurance 31,964 31,777
Pension contributions 13,820 11,782
Contract staff 1,818 5,091
----------------- -----------------
413,405 406,403
======== =========
One employee earned more than £70,000 during the year (2019: £60,000).
No. No.
The average weekly number of employees during the year
was as follows:
Fundraising and publicity 1.2 1.3
Provision of workspace 2.2 2.1
Business support programmes 3.3 3.6
Support 2.2 2.1
Management and administration .1 .1
-------------- --------------
(5 Full time, 7 Part time) 9.0 9.2
======= =======

No trustee received remuneration during the year (2019: Nil). No expenses were reimbursed to Trustees in the year (2019: Nil).

The aggregate remuneration of the charity’s key management personnel amounted to £193,555 (2019: £182,558).

35

FOR THE YEAR ENDED 30 SEPTEMBER 2020

NOTES TO THE FINANCIAL STATEMENTS (continued)

8. TAXATION

The charitable company is exempt from corporation tax as all its income is charitable and is applied for charitable purposes.

9. TANGIBLE FIXED ASSETS Leasehold Office
Property Improvements Equipment Total
£ £ £ £
Cost
At 30 September 2019 and at
30 September 2020 1,915,538 140,236 93,037 2,148,811
-------------------- --------------- ----------------- --------------------
Depreciation
At 30 September 2019 557,228 140,236 93,037 790,501
Charge for the year 31,015 - - 31,015
----------------- --------------- ----------------- -----------------
At 30 September 2020 588,243 140,236 93,037 821,516
----------------- --------------- ----------------- -----------------
Net Book Value
At 30 September 2020 1,327,295 - - 1,327,295
========= ======= ======== ==========
At 30 September 2019 1,358,310 - - 1,358,310
========= ======= ======== ==========
A loan with the NatWest Bank plc is secured on the freehold property (Note 11).
10a.
DEBTORS: amounts due within one year		 2020 2019
£ £
Due from licensees 5,977 14,423
Prepayments and accrued income 65,424 67,003
Cockpit Arts and Ingenious Business Growth Loan Fund - 3,370
------------------ ------------------
71,401 84,796
======== ========
10b.
DEBTORS: amounts due in over one year		 2020 2019
£ £
Cockpit Arts and Ingenious Business Growth Loan Fund - 3,013
======== ========

36

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

11. CREDITORS: amounts due within one year 2020 2019
£ £
Bank loans 8,252 42,497
Trade creditors 49,254 63,648
Taxation and social security 23,934 16,728
Accruals and deferred income 63,847 101,891
Deposits held on behalf of licensees 64,886 61,062
Other creditors 17,170 22,454
----------------- -----------------
227,343 308,280
======== ========
DEFERRED INCOME
Movements on deferred income balances included
within accruals and deferred income above:
Balance as at 1 October 2019 16,780 20,146
Released in the year (16,780) (20,146)
Amounts deferred in the year 12,907 16,780
--------------- ---------------
Balance as at 30 September 2020 12,907 16,780
======= =======
12. CREDITORS: amounts due after more than one year 2020 2019
£ £
Bank loan 50,000 -
Other creditors - 3,215
---------------- ----------------
50,000 3,215
======== ========

The charity has a bank loan secured on the property at Deptford. Interest is charged at 1.25% over base rate and the loan is repayable in equal monthly instalments ending in November 2020. This amount is recognised as due within one year.

The charity also has a loan under the Bounce Back Loan scheme for £50,000. Interest is charged at 2.5% per annum with no interest charged for the first 12 months. Capital repayments are due to be made in 60 equal instalments commencing in October 2021.

37

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

12. CREDITORS: amounts due after more than one year (continued)

The loans are repayable as follows:
2020 2019
£ £
Within 1 year 8,252 42,497
Between 2–5 years 40,000 -
More than 5 years 10,000 -
---------------- ----------------
58,252 42,497
======== ========
13. ANALYSIS OF NET ASSETS BETWEEN FUNDS Restricted Unrestricted Total
Funds Funds Fund
£ £ £
Tangible fixed assets 928,100 399,195 1,327,295
Net current assets/(liabilities) 101,730 189,017 290,747
Creditors: amounts falling due after more
than one year - (50,000) (50,000)
-------------------- ------------------ --------------------
1,029,830 538,212 1,568,042
========= ======== =========
13. ANALYSIS OF NET ASSETS BETWEEN FUNDS
Prior year comparative:
Restricted Unrestricted Total
Funds Funds Fund
£ £ £
Tangible fixed assets 946,367 411,943 1,358,310
Net current assets/(liabilities) 76,269 70,274 146,543
Creditors: amounts falling due after more
than one year - (3,215) (3,215)
-------------------- ------------------ --------------------
1,022,636 479,002 1,501,638
========= ======== =========

38

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

14. MOVEMENT IN FUNDS At the start At the end
of the year Income Expenditure of the year
£ £ £ £
Restricted funds:
Deptford capital funds 946,367 - (18,267) 928,100
General grants - 67,426 (45,419) 22,007
Provision of workspace - - - -
Business support programme 76,269 151,174 (147,720) 79,723
------------------- ---------------- -------------- --------------------
Total restricted funds 1,022,636 218,600 (211,406) 1,029,830
------------------- ---------------- -------------- -------------------
Unrestricted funds:
General funds 479,002 686,086 (626,876) 538,212
------------------- ---------------- ------------------ -------------------
Total funds 1,501,638 904,686 (838,282) 1,568,042
========= ======== ======== ==========
Prior year comparative
14. MOVEMENT IN FUNDS At the start At the end
of the year Income Expenditure of the year
£ £ £ £
Restricted funds:
Deptford capital funds 964,634 - (18,267) 946,367
Provision of workspace - - - -
Business support programme 66,009 204,555 (194,295) 76,269
Fundraising 793 - (793) -
------------------- ---------------- -------------- --------------------
Total restricted funds 1,031,436 204,555 (213,355) 1,022,636
------------------- ---------------- -------------- -------------------
Unrestricted funds:
General funds 392,319 815,437 (728,754) 479,002
------------------- ---------------- ------------------ -------------------
Total funds 1,423,755 1,019,992 (942,109) 1,501,638
========= ======== ======== ==========

39

NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 30 SEPTEMBER 2020

Purposes of restricted funds

Deptford capital fund

General grants

Net book value of the Deptford property funded by grants from London Development Agency (LDA) Cluster Fund, London Borough of Lewisham and SRB Silwood. Depreciation will be charged to this fund over 50 years.

Funding received towards the running costs of Cockpit Arts during the COVID-19 pandemic.

Business support programme Funding received towards the running costs of the business support programmes.

The comparative breakdown of funds and movement on funds for the prior year can be found in the prior year financial statements which have been filed at the Charity commission and are available at:

http://apps.charitycomission.gov.uk/Accounts/Ends43/0001029643_AC_20160930_E_C.pdf

15.

OPERATING LEASE COMMITMENTS 2020 2019
£ £
The charity has future lease payments at the year end
under operating leases for each of the following
periods:
Less than one year 41,750 167,000
1–5 years - 41,750
======== ========

The charity had a commitment under its current lease up to the date of expiry at 24 December 2020.

16. RELATED PARRTY TRANSACTIONS

During the year Cockpit Arts had no related party transactions.

17. SUBSIDIARY COMPANY

Cockpit Arts has a wholly owned trading subsidiary, Cockpit Arts & Exhibitions Limited, company number 0341833. It has no assets other than its £2 share capital. The company is dormant and has not traded in 2020 or 2019. The registered office of the company is Cockpit Yard, Northington Street, London WC1N 2NP

Jill Humphrey became the sole director of this subsidiary company during the year. There were no inter-company transactions in 2020 or 2019.

40

NOTES TO THE FINANCIAL STATEMENTS (continued)

FOR THE YEAR ENDED 30 SEPTEMBER 2020

18. COMPARATIVE STATEMENT OF FINANCIAL ACTIVITIY

Notes Restricted Unrestricted Total Total
funds Funds 2019 2018
£ £ £ £
Income and Expenditure
Income from:
Donations
Fundraising - 19,858 19,858 23,298
Marketing and events - 64,276 64,276 79,278
Charitable activities
Provision of workspace 2 - 697,137 697,137 694,389
Business support programmes 3 204,555 33,087 237,642 162,799
Investment income - 1,079 1,079 711
--------------------- ------------------ --------------------- ---------------------
Total income 204,555 815,437 1,019,992 960,475
--------------------- ------------------ --------------------- ---------------------
Expenditure on:
Raising funds
Fundraising 793 20,376 21,169 21,791
Marketing and events - 72,111 72,111 63,809
Charitable activities
Provision of workspace 18,267 422,635 440,902 450,375
Business support programmes 194,295 213,632 407,927 437,790
--------------------- ------------------ --------------------- ---------------------
Total expenditure 4 213,355 728,754 942,109 973,765
--------------------- ------------------ --------------------- ---------------------
Net income/(expenditure) and
movement in funds (8,800) 86,683 77,883 (13,290)
--------------------- ------------------ --------------------- ---------------------
Reconciliation of funds
Total funds brought forward 1,031,436 392,319 1,423,755 1,437,045
-------------------- ------------------ --------------------- ---------------------
Total funds carried forward 1,022,636 479,002 1,501,638 1,423,755
========= ======== ========= =========

41