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2022-03-31-accounts

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Registered number: 03209411 Charity number: 1056812

Seven Stories, The National Centre for Children's Books Limited (A company limited by guarantee)

Annual report

31 March 2022

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Contents

Page
Reference and administrative details 1 - 2
Trustees' report 3 - 12
Trustees' responsibilities statement 13
Independent auditor's report to the members of Seven Stories, The National Centre for 14 - 17
Children's Books Limited
Consolidated statement of financial activities 18
Consolidated balance sheet 19
Charity balance sheet 20 - 21
Consolidated statement of cash flows 22
Notes to the financial statements 23 - 51

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Reference and administrative details For the year ended 31 March 2022

Trustees Professor Matthew Grenby
Douglas Dodds (resigned 22 October 2021)
Nick Kemp, (Interim Chair 30/03/2021-22/10/2021)
Antony Pierce, (Interim Chair 30/03/2021-22/10/2021) (resigned 22 October 2021)
Matthew McWhinnie
Jeremy Cripps (resigned 30 November 2021)
Ed Ripley (resigned 30 March 2022)
Professor Ella Richie, (Interim Chair 30/03/2021 - 22/10/2021) (resigned 28
September 2022)
Sheena Ray (resigned 23 February 2022)
Mauricio Armellini (resigned 28 September 2022)
Annie Rigby (resigned 29 June 2022)
Ben Butler
Jill Coleman (Resigned 30 March 2022)
Rachel Mary Lippe
Amy Sergison (resigned 29 June 2022)
Claire Riley, Chair (appointed 22 October 2021)
Company registered
number
03209411
Charity registered
number
1056812
Registered office
30 Lime Street
Ouseburn Valley
Newcastle upon Tyne
NE1 2PQ
Company secretary
Wendy Elliott
Chief executive officer
Mairi Kidd (resigned 20/08/2021)
Wendy Elliott (interim role from 20/08/2021, appointed to permanent role
18/05/2022)
Independent auditor
UNW LLP
Chartered Accountants
Citygate
St James Boulevard
Newcastle upon Tyne
NE1 4JE

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Reference and administrative details (continued) For the year ended 31 March 2022

Bankers

NatWest 4 Bridge Street Morpeth Northumberland NE61 1NG

CAF PO Box 289 Kings Hill West Mailing Kent ME19 4TA

Unity Trust 9 Brindley Place Birmingham B1 2HB

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report For the year ended 31 March 2022

The Trustees (who are also directors of the charity for the purposes of the Companies Act) present their annual report together with the audited financial statements of Seven Stories, The National Centre for Children's Books Limited ("Seven Stories") (the company) for the year ended 31 March 2022. The Trustees confirm that the annual report and financial statements of the company comply with the current statutory requirements, the requirements of the company's governing document and the provisions of the Statement of Recommended Practice (SORP), applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

Objectives and activities

Policies and objectives

Seven Stories is the National Centre for Children’s Books. Our focus is literature and associated illustrations and related material specifically created for children, and the various ways these are shared, collected, conserved, promoted, and disseminated. We aim to enhance lives through access to stories.

Our vision is to put stories at the heart of every childhood, empowering young people to understand their world and imagine their future.

We celebrate the exceptional achievements of British and international writers and illustrators for children, saving their work as part of our nation’s heritage, for the enjoyment and inspiration of current and future generations.

The object of the charity, as set out in our governing document, is to advance the education of the public, in particular, children and young people, in the arts and literature through the promotion of Britain's literary heritage for children, and in particular, but not exclusively, by preserving, maintaining and adding to the Collection held by the Seven Stories Collection Trust and by the promotion of access to the Collection and associated items through arts and education programmes and activities.

Main activities undertaken to further the charity's purposes for the public benefit

The charity undertakes a variety of activities to deliver its objectives, including education and community centred engagement, the promotion of literacy and reading, running an attractive Visitor Centre with an active events programme, digital delivery to ensure accessibility and reach, and developing and maintaining a collection of books, manuscripts, illustrations and related materials.

Our Visitor Centre in Newcastle upon Tyne houses exhibition galleries as well as performance and creative learning spaces, a specialist bookshop and a café. We have a regular and engaging events programme including story telling, author and illustrator talks, and creativity development and learning. An extensive external programme supports talent development and brings creative activity into schools and communities to reach young people, helping to promote literacy and creativity, both via face to face engagement and our developing use of digital platforms.

The Collection is an internationally renowned archive comprising of manuscripts, artwork, related papers and books, dating from the 1930s to the present day. We hold National styling through Arts Council England’s accreditation scheme, acknowledging the singularity and significance of our work to protect and share our literary heritage for children. We use our Collection as an artistic, educational and research resource to celebrate the literary and visual arts through exhibitions, displays and learning programmes, both at our Visitor Centre, and in facilities across the UK through our touring programme.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Objectives and activities (continued)

While entry to our Visitor Centre is free, we do make some charges to our audience, including to schools and members of the general public, for some activities and events, to help fund our work. Our admission charges are kept as low as possible in order to enable wider access, balanced with the need to earn income and ensure the charity’s viability.

We seek to work in communities, particular disadvantaged communities in our local area, and we receive financial support for such purposes.

At all of our Trustee meetings we keep in mind the Charity Commission’s guidance on public benefit. As Trustees we see the benefits our audience, partners and communities gain from our organisation.

Staff and volunteers

Seven Stories employed an average of 58 people (34 full time equivalent) in total during 2021/22; 35 on permanent contracts and 23 on casual contracts. 17 staff were full time staff and 41 on a part time basis. Staff turnover was, as expected, high as the previous year had been unusually low due to the pandemic, with staff furloughed when appropriate. A number of staff left as a result of changes to the business model described below. These changes afforded us the opportunity to recruit much needed skills to key roles in line with our business plan, including senior positions in communications and operations and systems roles as well as various community, education and digital roles which are key to our business development.

Strategic report

Achievements and performance

Accreditation and awards

Seven Stories is a National Portfolio Organisation (Band 2) supported by Arts Council England. It is also an Accredited Museum with National styling.

Seven Stories holds the accredited 'Investing In Children' award recognising the quality of its work with children and young people.

Review of activities

The year commenced with Seven Stories in a relatively strong position, with significant financial reserves, notwithstanding the previous impact of Covid related restrictions, a new senior management team, including a permanent Chief Executive, and the prospect of Covid restrictions being largely lifted, enabling new exhibitions at the Newcastle Visitor Centre. Indeed, the year saw a number of significant items of progress, although there were also some significant challenges.

Major areas of progress have included the formal acceptance into the Collection of the Judith Kerr archive, following a period of loan, which, along with other additions, has confirmed the status of the Collection as one of the most important in Britain; the development of a new online presentation of some of the Collection’s content, improving accessibility; renewed focus on the Visitor Centre, and a new Business Model, introduced to improve accessibility further. Of particular importance, was the award of NPO extension funding from Arts Council England, establishing a strong potential basis for an application for the subsequent period 2023-2026.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Strategic report (continued)

Achievements and performance (continued)

However, a bold and experimental investment in exhibition format and content did not deliver expectations in visitor numbers, and this had a significant impact on overall financial performance. As a vibrant, arts-based organisation, it is important that such experimentation continues where enabled by financial reserves. In addition, the renewed focus on the Visitor Centre, previously restricted by Covid, reduced the extent of some other activities with additional financial impacts.

The interim Board took steps to address these challenges and encouraged the introduction of a new business model, based on free general access to the Visitor Centre, with specific payments for particular events. In addition, changes took place to leadership and organisational capacity, including a new Chair of Trustees to replace an interim position and new Senior Leadership. These changes have significantly improved operational performance. Further development is ongoing.

We have also improved our existing activities. We have learnt that performance and live elements substantially improve value. We have developed our audience from typically Early Years and Key Stage 1 to Key Stages 2 and 3. Our new business model includes different types of exhibitions in our galleries, delivering more access and engagement through less complex (and substantially lower cost) displays. Moreover, we have been able to utilise materials from our own Collection more extensively, and we have co-produced exhibits with children and young people, receiving Investing In Children accreditation as recognition of excellent participatory practice. We have recognised that a major barrier to experiencing our Visitor Centre activities and displays was a relatively high entry cost. After piloting different approaches, we recognised our responsibility in terms of widening access as both a National Centre but also a regional organisation with a national asset in our Collection. Therefore, we took the decision to implement our first ever free entry model, thereby removing the principal barrier to accessing culture. This resulted in a substantial increase in attendance numbers, including a very welcome increase in new visitors from less affluent communities. We have also re-introduced our education offer, streamlining the number of activities previously offered and bringing it up to date with the renewed educational priorities.

Our main focus following the lifting of COVID restrictions was on face to face delivery, engaging our most impacted communities and focusing on delivering support to children and families worsened in the aftermath of COVID, continuing our portfolio of activities with community-based organisations, working with partners to provide a more holistic offer and meeting the needs of local disadvantaged communities. Our touring programme gradually reopened with Judith Kerr’s The Tiger Who Came to Tea facsimile tour and David McKee’s Elmer and Friends original artwork both touring nationally.

We continued to capitalise on the move to digital delivery with the launch of our online platform showcasing the Collection and stories behind it, https://sevenstories.online/ This strategic development makes our Collection available to all through very rich, entertaining and engaging online content for the first time. This will become a vital new aspect of Seven Stories.

Collection

As noted above, major progress has been made with the Collection’s content, as well as in access and presentation. There were particularly noteworthy additions, including the notable achievement of the formal Acceptance in Lieu of the Judith Kerr archive. This is a significant addition to our Collection and it allows us to further embark on our aspirations to diversify our audiences and improve access to culture across the region and beyond.

We were also able to take part in a Windrush project to highlight the contributions of Caribbean and BritishCaribbean writers to British children’s literature, exploring the ways they have transformed and deepened our understanding of history, culture and the story of the Windrush. This primarily drew on our archives for four writers; Grace Hallworth, Grace Nichols, John Agard and Valerie Bloom. We need to recognise further how our Collection has developed into a significant National Treasure, which we need to continue to expand, document and enhance accessibility.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Strategic report (continued)

Achievements and performance (continued)

Facilities

We were able to consolidate the significant changes made in respect of facilities but previously interrupted by lockdown and other restrictions. The move of the Collection to the Central Library was completed with staff able return to work on-site. The closure of the MX5 remote offices and consolidation at the Visitor Centre meant staff were able to work more closely and ensure a streamlined and efficient plan for reopening. Considerable benefits were delivered in respect of team working, as well as cost reductions.

Leadership

The year saw major changes in leadership. At the beginning of the year, a small group of Trustees took over the Chair role jointly following the departure of the previous Chair due to health reasons. Seven Stories recognised a vital need to reform its governance and, following the appointment of a new permanent Chair at the end of 2021, engaged the specialist law firm DAC Beachcrofts, on an honorary basis, to conduct a full independent review. They have now made a series of recommendations based on best practice and in line with charitable organisations operating in the Cultural sector. These included the responsibilities and duties of the Board and individual Trustees, the size and skills mix, its structure, decision-making processes, delegations, reporting and relationships with the permanent Executive. These recommendations have been considered by the Board, adopted as appropriate, and are now being implemented. Key ongoing developments now being taken forward include clarifying roles and duties, new appointments to improve diversity and competence, and greater focus. We are introducing a new sub-committee structure that will better enable the effective oversight of the organisation, enabling greater focus on specific issues. We will include our stakeholders in the design and implementation of these arrangements. Managing risk will also have a more formal focus, with particular Trustee input on identifying and mitigating emerging risks, safeguarding the security of the organisation and achieving environmental sustainability.

We envisage that the new fit-for-purpose Board led governance arrangements will be in place by the commencement of 2023.

In the course of the year, Wendy Elliott was appointed as Chief Executive, initially on an interim basis, to develop and implement the new business model. Wendy was subsequently confirmed as permanent Chief Executive Officer in May 2022. The current Leadership structure has been redesigned to take account of the changing nature of the organisation and its activities, and includes specific Programme management responsibilities. The Seven Stories Chief Executive has overall management responsibilities for the organisation, supported by a Finance Director, a Marketing and Business Development Head and an Organisation Systems Head. The Chief Executive has overall responsibility for the successful delivery of the business strategy, reporting to the Board.

Fundraising and development

Seven Stories has a small development and relationship workforce that oversees our fundraising, marketing and communication activities and manages the grants and donations received from trusts and foundations. We aim to generate funds through a small number of fundraising events, in addition to working with corporate donors and sponsors. Relationships are also cultivated to encourage support and donations to the Collections’ Trust, either direct gifts of artwork and manuscripts or financial support for the purchase thereof. Heritage assets with an estimated value of £940,395 (£250,000 in 2019/20) were donated to The Collection Trust, principally comprising the Judith Kerr archive, much of which was already held on a long-term loan.

The Vital North Partnership (VNP) is supported by Arts Council England’s National Portfolio Funding and Newcastle University for 2018 - 2023. This initiative aims to advance strategies that consolidate Newcastle’s position as a centre of excellence for children’s literature through research, teaching and public engagement.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Strategic report (continued)

Financial review

The financial position of the organisation and performance during the year reflects the ongoing pressures highlighted above.

A loss of £191,712 was made on unrestricted funds, compared with a surplus of £201,813 in the prior year. Combined with surpluses on restricted funds and restricted capital funds, there was an overall surplus of £593,483 for the year compared with £348,565 in the preceding year.

2021/22 was the fourth year of delivery of our Arts Council England National Portfolio Organisation activity, which was granted originally to support our work from 2018/19 to 2021/22. The grant includes additional funding to support the development and growth of the Collection and to support the potential of the Vital North Partnership with Newcastle University. The overall annual grant was £588,230. Due to the pandemic, an additional year of funding for 2022/23 was made available which we were successful in our application for.

Other grants awarded during the year included:

We had received £160,000 from the Weston Culture Fund for work in 2020/21 and 2021/22 for digital development and website improvements.

We are grateful to the following organisations who supported our work during the financial year:

Corporate Sponsors & Supporters:

Belsay Hall Educational Partnership Durham Cathedral Durham University North East Social Tech Fund Oxford University Press Reach PLC/ Mirror Group Pride of Britain Stowe Family Law

Revenue and Project Grants:

Arts Council England ACE Culture Recovery Fund 1 BBC Children in Need Community Foundation - Guy Readman Endowment Fund Community Foundation – Sowler Family Fund Community Foundation - Enid Blyton Fund for Seven Stories Community Foundation - Newcastle Culture Investment Fund The Esmée Fairbairn Collections Fund – delivered by the Museums Association Eyre Family Foundation Family Explorers Garfield Weston Foundation Gillian Dickinson Trust Helen Bailey Trust Ministry of Housing, Communities & Local Government Jeremy Beecham Fund at the Community Foundation Newcastle City Council Newcastle Culture Education Partnership

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Sir James Knott Trust St Nicholas Education Trust The Shears Foundation The Sir Tom Cowie Charitable Trust Unwin Charitable Trust WA Handley Trust Well Newcastle Gateshead Wolfson Foundation and the Friends of Seven Stories and many other individual supporters

In kind support of events programme:

Newcastle University

Going concern

After making appropriate enquiries, the Trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

Management has determined that there is no material uncertainty that casts doubt on the entity’s ability to continue as a going concern. It expects that the cost of living pressures might have some impact in relation to expected performance but that these can be mitigated through ongoing cost control and diversification of income and delivery methods. Our charitable objectives already mean we deliver activities that align with the aims of many Trusts and Foundations.

It is vital that the development of the new business model and the introduction of expanded activities, supported by organisational development, is achieved. Timely action was taken to restrict the impact of unsuccessful activities and recommence other, more promising and profitable, areas in the year. While the turnaround took some months to be evident, the first four months of 2022/23 were profitable and while spend has increased in subsequent months, this has been in a controlled way and in line with our income generation plans.

A revised risk management process has been introduced, enabling Trustees to have greater assurance. Implementation of recommendations from the Governance review mean we will have a Board which is equipped to take us through upcoming challenges.

The appointment of Claire Riley as our new Chair and Wendy Elliott as permanent Chief Executive have put us on a strong footing for the future, with steps already being taken to ensure strong creative leadership and digital development to underpin our business model.

We will continue to develop our business model to ensure resilience to potential future restrictions and, at the same time, fully deliver our charitable objectives as a viable business and sustainable organisation.

Looking to next year, the most important issue is the continuation of ACE support for the NPO 2023-26 funding period. Our business plan is clearly aligned to ACE’s Let’s Create strategy and its four investment principles. We were delighted to receive an offer for the full amount of our application in October 2022 with final submission of our business plan due in January 2023.

Investment in management and data systems and processes will improve our ability to make more informed management decisions. Seven Stories is proud to participate in Bloomberg Philanthropies’ Digital Accelerator for Arts and Culture, which supports arts organizations through strategic improvements to technology infrastructure.

New external educational and community activity has been developed. We are expanding digital programming, products and services for families and schools, as well as our award winning community programmes.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Reserves policy

Trustees reviewed the reserves policy in September 2015 following the completion of a capital refurbishment project. It was agreed that the minimum level of cash reserves should be equivalent to those that allow the charity to fulfil its statutory obligations arising on closure and provide sufficient working capital to enable arrangements to be made to re house the Collection. This minimum reserve requirement was estimated to be £175,000 at March 2022. The Trustees also agreed that additional reserves should be set aside to enable the charity to respond to significant unplanned events, such as unexpected capital expenditure or the loss of a key funding stream. Including provision for these unplanned events, the reserves target is between £350,000 to £425,000.

At 31 March 2022, the group held free reserves of £95,260 in deficit (£174,816 surplus in 2020/21), being £211,560 unrestricted funds less £25,795 intangible fixed assets and less £281,025 of tangible fixed assets as a decision was made to invest in new Gallery spaces during the year. Work has been undertaken to develop a financial strategy that will enable the level of reserves to be increased over the next four years.

Plans for future periods

We will build on the changes implemented in the second half of the year ended 31 March 2022 to create a platform for future development and growth. Plans include:

Our business plan for the next financial year builds on our previous success in maintaining tight cost control; growing and diversifying income, notably through schools and communities and an enhanced Visitor Centre experience; and greater digital delivery. We will prioritise an enhanced educational offer, and inspire and enable creativity in our audiences and partners. We will extend and deepen the book and story related activities we can undertake online.

Supported by grant funding, we will explore new approaches to exhibitions and similar activity, both in our Visitor Centre and with Touring venues. We will undertake development work with the Collection, enhancing its management and accessibility, including through the partnership with Newcastle University. We will be building new capacity through the development of our people, notably in creativity.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Structure, governance and management

Constitution

Seven Stories, The National Centre for Children's Books is a company limited by guarantee governed by its Articles of Association. It was first registered with the Charity Commission on 7 May 1996. The charity’s governing documents, and those of its related parties, were reviewed and updated in October 2018.

Methods of appointment or election of Trustees

The management of the group and the charity is the responsibility of the Trustees who are elected and co opted under the terms of the Memorandum of Association.

Organisational structure and decision-making policies

The Board of Trustees administers the charity. The Board meets between four and six times a year under usual circumstances, and there are three committees: Executive, Finance and Organisation Committee; Literature, Programme and Acquisitions Committee and the Strategy and Development Group. However, the implementation of the Governance Review will introduce significant changes to the sub-committee structure, particularly to align with the new NPO programme, and the underpinning Arts Council England’s Lets Create Strategy.

Mairi Kidd was appointed to the Chief Executive position, and started in post from 1 February 2021, Following Mairi’s departure in August 2021, Wendy Elliott took up post as interim Chief Executive Officer.

An interim Board structure was introduced in March 2021, following the retirement of the previous Chair of Trustees due to ill health. Claire Riley was appointed as Chair of Trustees in October 2021.

During the second half of 2021/22 an interim management team was in place, pending the appointment of a new permanent Chief Executive. The management team consisted of an interim Chief Executive Team appointed by the Trustees from October 2021 to manage the day to day operations of the charity. To facilitate effective operations the Team have delegated authority, within the terms of delegation approved by the Trustees, for operational matters including finance, employment and artistic activity.

To fulfil these responsibilities, the Team worked with a senior management team comprised additionally of the Finance Director, a Director of Marketing and Communcations and an Operations Director.

Pay policy for senior staff

The rates of pay and remuneration of all staff, including the senior management team, are set by the Board of Trustees. The annual pay review considers statutory changes, inflation, the affordability of a pay award in the context of financial performance, benchmarking to similar organisations and the outcomes of an individual appraisal process.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Structure, governance and management (continued)

Related party relationships

Seven Stories has two related entities: Seven Stories Trading Company and Seven Stories Collection Trust. The accounts of these entities are consolidated with those of the main charity in these accounts.

Seven Stories Trading Limited is the charity’s wholly owned subsidiary, a company limited by shares, registered in England and Wales, number 04177830. It operates commercial activities including the bookshop, cafe and corporate events. The subsidiary company commenced trading on 19 August 2005. Profits of the subsidiary are gifted to the charity.

Seven Stories, The National Centre for Children’s Books’ Collection Trust is an independent charitable trust which was established by a Declaration of Trust dated 9 June 2005 and whose Trustees are appointed by Seven Stories Board of Trustees. It is a separate charity, registered with the Charity Commission with charity number 1115167. The main object of the Collection Trust is to own and protect the archive. It is supported by Seven Stories staff through a management agreement dated 25 August 2006. These accounts are consolidated solely to comply with SORP and company law requirements and are not intended to affect the status of both charities as separate legal entities.

The trading company’s Articles of Association and the Collection Trust’s Deed of Trust and management agreement were updated in 2015. This reflected the change of name of the main Charity, and also aligned these documents with the changes made in the Charity’s Articles and recent legislation. For the Collection Trust, these changes were agreed through a Deed of Variation at the Trustees meeting held on 25 February 2016. For the trading company, the changes were adopted by special resolution at a meeting of the trading company Directors on 18 November 2015.

Key risks and uncertainties

The key risks facing Seven Stories in 2022/23 are associated with ensuring business viability and sustainability in a changing environment and an uncertain public and private funding landscape, while ensuring we continue to meet our charitable objectives.

A key aspect of these risks is ensuring the organisation develops its governance, its portfolio of activities and delivery methods, its management and organisational capability and its financial reserves, to adapt to such changes.

While significant changes have been made in terms of controlling expenditure and investing in new income streams (in particular digital), uncertainty over how audiences will behave in the future, changing government policy, changes to our ways of working across the business and potential issues around the availability of funding will continue to be carefully monitored.

Other potential immediate risks might arise from the impact of the cost of living crisis both in terms of our own costs increases and of reductions in the visitor income, as well as:

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Trustees' Report (continued) For the year ended 31 March 2022

Structure, governance and management (continued)

Risk mitigation

The priorities outlined in 'Plans for future periods’ above have been identified specifically in order to address these concerns. Progress towards these strategic objectives is being very closely monitored by the Board and Arts Council England. Our risk schedule is reviewed and updated at each Board meeting and work is ongoing to ensure that risk management is embedded from governance of the organisation and throughout the management structure.

Information on fundraising practises

Our general approach to fundraising is to work with existing networks and relationships, with general, non targeted appeals for specific projects. This includes our Friends, Chapter One founders, corporate and general visitors. We are mindful to ensure the protection of the public, including vulnerable people, from unreasonably intrusive or persistent fundraising approaches and undue pressure to donate. Seven Stories does not work with any commercial participators or professional fundraisers, beyond using fundraising websites such as Crowdfunder.

Our fundraising conforms to recognised standards and, if there were any complaints about our approach, they would be handled using our formal Complaints Policy and Procedures. There were no complaints in the year under review.

Disclosure of information to auditor

Each of the persons who are Trustees at the time when this Trustees' report is approved has confirmed that:

Auditor

The auditor, UNW LLP, has indicated his willingness to continue in office. The designated Trustees will propose a motion reappointing the auditor at a meeting of the Trustees.

Approved by order of the members of the board of Trustees on 30 November 2022 and signed on their behalf by:

Claire Riley, Chair

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Statement of Trustees' responsibilities For the year ended 31 March 2022

The Trustees (who are also the directors of the charity for the purposes of company law) are responsible for preparing the Trustees' report including the strategic 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 . Under company law, the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the charity and of their incoming resources and application of resources, including their income and expenditure, for that period. In preparing these financial statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the group and the charity's transactions and disclose with reasonable accuracy at any time the financial position of the group and the charity 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 group and the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Approved by order of the members of the board of Trustees on 30 November 2022 and signed on its behalf by:

Claire Riley, Chair

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Independent auditor's report to the Members of Seven Stories, The National Centre for Children's Books Limited

Opinion

We have audited the financial statements of Seven Stories, The National Centre for Children's Books Limited (the 'parent charitable company') and its subsidiaries (the 'group') for the year ended 31 March 2022 which comprise the Consolidated statement of financial activities, the consolidated balance sheet, the charity balance sheet, the consolidated statement of cash flows and the related notes, 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 group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the Trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's or the parent charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.

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DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Independent auditor's report to the Members of Seven Stories, The National Centre for Children's Books Limited (continued)

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The Trustees are responsible for the other information contained within the 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.

Opinion 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 our 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' report including the Strategic report.

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

Responsibilities of Trustees

As explained more fully in the Trustees' responsibilities statement, 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.

15

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Independent auditor's report to the Members of Seven Stories, The National Centre for Children's Books Limited (continued)

In preparing the financial statements, the Trustees are responsible for assessing the group's and the parent 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 group or the parent 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We identified areas of law and regulations that could reasonably be expected to have a material effect on the financial statements from our general and sector experience and through discussions with the directors and other management (as required by Auditing Standards) and from inspection of the company's legal correspondence and we discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations. We have communicated identified laws and regulations within our audit team and remained alert to any indications of non compliance throughout the audit.

Firstly, the company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation), distributable profits legislation and taxation legislation and we have assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

Secondly, the company is subject to many other laws and regulations where the consequences of noncompliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines and litigation. We identified the following areas as those most likely to have such an effect; health and safety, employment law, safeguarding, data protection and certain aspects of company legislation, recognising the nature of the company's activities. Auditing Standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Through these procedures we have not become aware of any actual or suspected non-compliance.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

16

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Independent auditor's report to the Members of Seven Stories, The National Centre for Children's Books Limited (continued)

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 its members, as a body, for our audit work, for this report, or for the opinions we have formed.

Anne Hallowell BSc DChA (Senior Statutory Auditor) for and on behalf of UNW LLP, Statutory Auditor

Chartered Accountants Newcastle upon Tyne

30 November 2022

17

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Consolidated Statement of financial activities (incorporating income and expenditure account) For the year ended 31 March 2022

Note
Income from:
Donations and legacies
3
Charitable activities
4
Other trading activities
5
Investments
Other income
6
Total income and
endowments
Expenditure on:
Raising funds
Charitable activities
Total expenditure
Net
(expenditure)/income
before net gains on
investments
Net gains on
investments
Net
(expenditure)/income
Transfers between funds
17
Net movement in
funds
Reconciliation of
funds:
Total funds brought
forward
Net movement in funds
Total funds carried
forward		 Unrestricted
funds
2022
£
42,922
1,030,961
274,571
-
35,382
1,383,836
204,344
1,312,100
1,516,444
(132,608)
1,844
(130,764)
(60,948)
(191,712)
403,272
(191,712)
211,560		 Restricted
funds
2022
£
-
73,513
-
561
-
74,074
-
113,128
113,128
(39,054)
-
(39,054)
-
(39,054)
290,392
(39,054)
251,338		 Restricted
capital funds
2022
£
939,495
-
-
15
-
939,510
-
176,209
176,209
763,301
-
763,301
60,948
824,249
5,170,264
824,249
5,994,513		 Total
funds
2022
£
982,417
1,104,474
274,571
576
35,382
2,397,420
204,344
1,601,437
1,805,781
591,639
1,844
593,483
-
593,483
5,863,928
593,483
6,457,411		 Total
funds
2021
£
364,900
1,303,993
133,534
800
47,313
1,850,540
103,095
1,387,465
1,490,560
359,980
1,428
361,408
-
361,408
5,502,520
361,408
5,863,928

The Consolidated statement of financial activities includes all gains and losses recognised in the year.

The notes on pages 23 to 51 form part of these financial statements.

18

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Consolidated balance sheet As at 31 March 2022

Note
Fixed assets
Intangible assets
10
Tangible assets
11
Heritage assets
12
Investments
13
Current assets
Stocks
14
Debtors
15
Cash at bank and in hand
Creditors: amounts falling due within one
year
16
Net current assets
Total assets less current liabilities
Total net assets
Charity funds
Restricted capital funds
17
Restricted funds
17
Unrestricted funds
17
Total funds		 46,969
111,849
225,394
384,212
(238,445)		 2022
£
25,795
1,762,633
4,513,187
10,029
6,311,644
145,767
6,457,411
6,457,411
5,994,513
251,338
211,560
6,457,411		 38,600
153,400
672,993
864,993
(387,440)		 2021
£
-
1,815,398
3,562,792
8,185
5,386,375
477,553
5,863,928
5,863,928
5,170,264
290,392
403,272
5,863,928

The Trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements.

The financial statements were approved and authorised for issue by the Trustees on 30 November 2022 and signed on their behalf by:

Claire Riley, Chair

The notes on pages 23 to 51 form part of these financial statements.

19

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Balance sheet As at 31 March 2022

Note
Fixed assets
Intangible assets
10
Tangible assets
11
Heritage assets
12
Investments
13
Current assets
Stocks
14
Debtors
15
Cash at bank and in hand
Creditors: amounts falling due within one
year
16
Net current assets
Total assets less current liabilities
Total net assets
Charity funds
Restricted capital funds
Restricted funds
Unrestricted funds
Total funds		 20,000
108,046
167,025
295,071
(230,308)		 2022
£
25,795
1,762,633
10,000
10,030
1,808,458
64,763
1,873,221
1,873,221
1,442,983
251,338
178,900
1,873,221		 -
181,629
613,305
794,934
(376,354)		 2021
£
-
1,815,398
-
8,186
1,823,584
418,580
2,242,164
2,242,164
1,595,127
290,392
356,645
2,242,164

20

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

BALANCE SHEET (CONTINUED) As at 31 March 2022

The charity's net movement in funds for the year was £(368,943) (2021 - £67,849).

The Trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements.

The financial statements were approved and authorised for issue by the Trustees on 30 November 2022 and signed on their behalf by:

Claire Riley, Chair

Company registered number: 03209411

The notes on pages 23 to 51 form part of these financial statements.

21

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Consolidated statement of cash flows For the year ended 31 March 2022

Note
Cash flows from operating activities
Net cash used in operating activities
20
Cash flows from investing activities
Purchase of intangible assets
Purchase of tangible fixed assets
Purchase of heritage assets
Net cash used in investing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
21		 2022
£
(249,089)
(28,557)
(169,053)
(900)
(198,510)
(447,599)
672,993
225,394		 2021
£
610,318
-
(117,606)
-
(117,606)
492,712
180,281
672,993

The notes on pages 23 to 51 form part of these financial statements

22

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies

1.1 Basis of preparation of financial statements

The financial statements have been prepared in accordance with the Charities SORP (FRS 102) - Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Seven Stories, The National Centre for Children's Books Limited meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy.

The consolidated statement of financial activities (SOFA) and consolidated balance sheet consolidate the financial statements of the charity and its subsidiary undertaking. The results of the subsidiary are consolidated on a line by line basis.

The charity has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own statement of financial activities in these financial statements.

1.2 Going concern

Trustees have determined that there is no material uncertainty that casts doubt on the entity’s ability to continue as a going concern. It expects that the cost of living pressures might have some impact in relation to expected performance but that these can be mitigated through ongoing cost control and diversification of income and delivery methods. Our charitable objectives already mean we deliver activities that align with the aims of many Trusts and Foundations. We have confirmed funding from Bloomberg Philanthropies to support with implementation of digital technology including a new CRM and website over the next 2 years to better inform future business decisions, and have been successful in the application process to date for ACE NPO funding and support for 2023-26.

Investment in communication means we can continue to keep our existing audience engaged as well as being able to reach new audiences.

Despite a number of changes to the management team and Board during 2021/22 and 2022/23, we have worked hard to keep staff and stakeholders engaged. Our cash reserves and flexible business model have enabled us to respond quickly to challenges and reinstate previously successful models when analysis of performance indicated this was required.

We continue to update a scenario-based cash flow forecast weekly, and our cash reserves remain positive.

We utilise a rigorous risk analysis and management approach and continue to undertake horizon scanning. Risks are considered by the Board at our regular meetings, with mitigations implemented and monitored.

Implementation of the governance review recommendations and appointment of a permanent CEO, as well as investment in creative and digital capability, will ensure a strong leadership platform and flexible and diverse organisation able to respond to challenges.

Having considered all the steps taken as described above, and taking into account the strong cash position of the organisation, alongside the revised business model now in place, the Trustees consider that the going concern basis of preparation remains appropriate.

23

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies (continued)

1.3 Income

All income is recognised once the charity has entitlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably.

Donated services or facilities are recognised when the charity has control over the item, any conditions associated with the donated item have been met, the receipt of economic benefit from the use by the charity of the item is probable and that economic benefit can be measured reliably.

On receipt, donated professional services and facilities are recognised on the basis of the value of the gift to the charity which is the amount it would have been willing to pay to obtain services or facilities of equivalent economic benefit on the open market; a corresponding amount is then recognised in expenditure in the period of receipt.

Grants, including government grants, are included in the consolidated statement of financial activities on a receivable basis. The balance of income received for specific purposes but not expended during the period is shown in the relevant funds on the balance sheet. Where income is received in advance of entitlement of receipt, its recognition is deferred and included in creditors as deferred income. Where entitlement occurs before income is received, the income is accrued.

Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.

Income tax recoverable in relation to investment income is recognised at the time the investment income is receivable.

Other income is recognised in the period in which it is receivable and to the extent the goods have been provided or on completion of the service.

Museum and galleries tax relief income is recognised based on a prudent estimate of the amount of qualifying expenditure and applying the repayment rates set out in current HMRC legislation.

1.4 Expenditure

Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges allocated on the portion of the asset’s use.

Costs of raising funds are those incurred by Seven Stories Trading Limited. Support costs are those costs incurred directly in support of expenditure on the objects of the company and include project management carried out at the head office.

24

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies (continued)

1.4 Expenditure (continued)

Costs of generating funds are costs incurred in attracting voluntary income, and those incurred in trading activities that raise funds.

Charitable activities and Governance costs are costs incurred on the company's educational operations, including support costs and costs relating to the governance of the company apportioned to charitable activities.

1.5 Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the group; this is normally upon notification of the interest paid or payable by the institution with whom the funds are deposited.

1.6 Intangible assets and amortisation

Intangible assets costing £500 or more are capitalised and recognised when future economic benefits are probable and the cost or value of the asset can be measured reliably.

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Amortisation is provided on intangible assets at rates calculated to write off the cost of each asset on a straight-line basis over its expected useful life.

Amortisation is provided on the following basis:

Computer software - 33 %

1.7 Tangible fixed assets and depreciation

Tangible fixed assets costing £100 or more are capitalised and recognised when future economic benefits are probable and the cost or value of the asset can be measured reliably.

Exhibition costs, where the exhibition will be toured for in excess of one year, are capitalised at the cost of building the exhibition.

A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the statement of financial activities.

25

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies (continued)

1.7 Tangible fixed assets and depreciation (continued)

Tangible fixed assets are carried at cost, net of depreciation and any provision for impairment. Depreciation is provided at rates calculated to write off the cost of fixed assets, less their estimated residual value, over their expected useful lives on the following bases:

Land - Not depreciated - Freehold property 2% straight line down to residual value - Long-term leasehold property 4% straight line - Fixtures and fittings 5-33% straight line Exhibitions - Over the lifetime of the exhibition

1.8 Heritage assets

The group has a collection of heritage assets which are held in support of their objectives and are used as a unique and inspiring resource to create exhibitions, artistic and learning and research programmes dedicated to celebrating children’s books.

Acquisitions are made by purchase or donation. The heritage assets are included on the balance sheet on the basis of either:

It is not the intention of the Trustees to dispose of any of the assets within the Collection. Any disposals would be subject to the approval of the Trustees, although this would only happen in exceptional circumstances, and there must be sound curatorial reasons for disposal.

The items included within the Collection are deemed to have indeterminate lives and a high residual value; hence the Trustees do not consider it appropriate to charge depreciation.

Please refer to Note 12 of the accounts for further information on the heritage assets held by the group.

1.9 Stocks

Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks.

Stock includes books, merchandise and cafe food and drink stocks.

1.10 Debtors

Trade and other debtors are recognised at the settlement amount after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

26

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies (continued)

1.11 Cash at bank and in hand

Cash at bank and in hand includes cash and short-term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

1.12 Liabilities and provisions

Liabilities are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably.

Liabilities are recognised at the amount that the charity anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide.

Provisions are measured at the best estimate of the amounts required to settle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised in the consolidated statement of financial activities as a finance cost.

1.13 Financial instruments

The group only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.

1.14 Operating leases

Rentals paid under operating leases are charged to the consolidated statement of financial activities on a straight line basis over the lease term.

1.15 Pensions

The group operates a defined contribution pension scheme and the pension charge represents the amounts payable by the group to the fund in respect of the year.

27

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

1. Accounting policies (continued)

1.16 Fund accounting

General funds are unrestricted funds which are available for use at the discretion of the Trustees in furtherance of the general objectives of the group and which have not been designated for other purposes.

Designated funds comprise unrestricted funds that have been set aside by the Trustees for particular purposes. The aim and use of each designated fund is set out in the notes to the financial statements.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the group for particular purposes. The costs of raising and administering such funds are charged against the specific fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

Investment income, gains and losses are allocated to the appropriate fund.

2. Critical accounting estimates and areas of judgment

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions:

The charity makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Critical areas of judgment:

The key source of judgment within the financial statements is the valuation of heritage assets, as there is often no readily available open market valuation available. Valuation is assessed based upon other comparable items coming to the market periodically and is reviewed annually by Collections staff. It is not the intention of the Trustees of Seven Stories, The National Centre for Children’s Books Collection Trust to dispose of any of the assets within the Collection.

Other key estimates used within the preparation of the financial statements are the useful lives of the fixed assets of the charity, which are used to set depreciation rates.

28

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

3. Income from donations and legacies

Unrestricted
funds
2022
£
Donations
41,217
Government grants
1,705
42,922
Total 2021
114,900		 Restricted
capital
funds
2022
£
939,495
-
939,495
250,000		 Total
funds
2022
£
980,712
1,705
982,417
364,900		 Total
funds
2021
£
267,007
97,893
364,900

4. Income from charitable activities

Unrestricted
funds
2022
£
Visitor centre
462,615
Programme
85,762
Learning
240,314
Collections
143,529
Exhibitions
98,741
1,030,961
Total 2021
1,135,448		 Restricted
funds
2022
£
-
16,077
49,031
8,405
-
73,513
168,545		 Total
funds
2022
£
462,615
101,839
289,345
151,934
98,741
1,104,474
1,303,993		 Total
funds
2021
£
520,388
110,470
536,563
104,322
32,250
1,303,993

29

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

5. Income from other trading activities Income from fundraising events

Corporate sponsorship
Total 2021
Income from non charitable trading activities

Charity trading income
Total 2021
Other incoming resources

Other operating income
Other income
Total 2021		 Unrestricted
funds
2022
£
-
370
Unrestricted
funds
2022
£
274,571
274,571
133,164
Unrestricted
funds
2022
£
1,184
34,198
35,382
47,313		 Total
funds
2022
£
-
370
Total
funds
2022
£
274,571
274,571
133,164
Total
funds
2022
£
1,184
34,198
35,382
47,313		 Total
funds
2021
£
370
Total
funds
2021
£
133,164
133,164
Total
funds
2021
£
13,933
33,380
47,313

6. Other incoming resources

Other income in the year relates to receipts relating to the Value North Partnership and community funding receipts.

30

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

7. Analysis of expenditure by activities

Visitor centre
Programme
Learning
Collections
Exhibitions
Development
Total 2021
Analysis of support costs
General office costs
IT support
Travel and accomodation
Subscriptions and licenses
Bank charges
Wages and salaries
Professional fees		 Activities
undertaken
directly
2022
£
825,023
41,892
113,407
82,878
120,290
10,968
1,194,458
1,076,037		 Support
costs
2022
£
218,806
14,587
83,146
40,114
43,032
7,294
406,979
311,428		 Total
funds
2022
£
1,043,829
56,479
196,553
122,992
163,322
18,262
1,601,437
1,387,465
Total
funds
2022
£
56,363
4,966
1,462
4,602
4,309
270,640
64,637
406,979		 Total
funds
2021
£
644,663
69,658
379,639
153,233
103,591
36,681
1,387,465
Total
funds
2021
£
63,499
8,007
152
1,744
1,646
184,288
52,092
311,428

The support costs have been allocated to each activity on the basis of headcount.

31

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

8. Auditor's remuneration

2022 2021
£ £
Fees payable to the charity's auditor for the audit of the charity's annual
accounts 15,000 15,000
Fees payable to the charity's auditor in respect of:
All non-audit services not included above 900 900

9. Staff costs

Wages and salaries
Social security costs
Contribution to defined contribution pension
schemes		 Group
2022
£
889,536
59,375
28,021
976,932		 Group
2021
£
786,016
57,123
29,142
872,281		 Charity
2022
£
821,952
56,164
25,929
904,045		 Charity
2021
£
748,467
55,466
27,910
831,843

The average number of persons employed by the charity during the year was as follows:

Group Group
2022 2021
No. No.
All employees 58 60

The average headcount expressed as full-time equivalents was:

Visitor centre and learning
Collections
Trading
Management		 Group
2022
No.
18
5
3
8
34		 Group
2021
No.
15
4
4
9
32

32

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

9. Staff costs (continued)

No employee received remuneration amounting to more than £60,000 in either year.

Remuneration and benefits received by key management personnel

The key management personnel of the group comprise those of the charity and the key management personnel of its trading subsidiary, Seven Stories Trading Limited.

Key management personnel are deemed to be those having authority and responsibility, delegated to them by the Trustees for planning, directing and controlling the activities of the charity. During 2021/22 they were:

Chief Executive – Mairi Kidd

Collections Director and Acting Co-Chief Executive – Sarah Lawrance Creative Director and Acting Co-Chief Executive – John Coburn Head of HR and Operations - Wendy Elliott Finance Director - Lucy Smyth

The total employee benefits of the key management personnel of the group were £178,326 (2021: £204,778).

10. Intangible assets

Group and charity

Cost
Additions
At 31 March 2022
Amortisation
Charge for the year
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Computer
software
£
28,557
28,557
2,762
2,762
25,795
-

33

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

11. Tangible fixed assets

Group and charity

Cost or valuation
At 1 April 2021
Additions
Transfers between
classes
At 31 March 2022
Depreciation
At 1 April 2021
Charge for the year
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Freehold
property
£
3,552,626
-
-
3,552,626
2,552,626
-
2,552,626
1,000,000
1,000,000		 Long-term
leasehold
property
£
21,419
-
-
21,419
13,709
856
14,565
6,854
7,710		 Fixtures
and fittings
£
3,250,967
18,162
-
3,269,129
2,565,577
177,070
2,742,647
526,482
685,390		 Exhibitions
£
344,059
10,391
253,910
608,360
335,171
43,892
379,063
229,297
8,888		 Assets under
construction
£
113,410
140,500
(253,910)
-
-
-
-
-
113,410		 Total
£
7,282,481
169,053
-
7,451,534
5,467,083
221,818
5,688,901
1,762,633
1,815,398

Included in land and buildings is freehold land of £504,208 which has not been depreciated.

As detailed in note 23, Newcastle City Council and Arts Council England have a legal charge over the land and buildings.

34

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

12. Heritage assets

Group

Assets recognised at cost/valuation

Carrying value at 1 April 2021
Additions
Carrying value at 31 March 2022		 Antiquarian
books and
manuscripts
2022
£
3,562,792
950,395
4,513,187		 Total
2022
£
3,562,792
950,395
4,513,187

Charity

Assets recognised at cost/valuation

Additions
Carrying value at 31 March 2022		 Antiquarian
books and
manuscripts
2022
£
10,000
10,000		 Total
2022
£
10,000
10,000

35

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

12. Heritage assets (continued)

5 year summary of heritage asset transactions

Group

Purchases
Purchases
Donated assets at valuation
Total additions
Charity
Purchases
Donated assets at valuation
Total additions		 2022
£
900
949,495
950,395
2022
£
10,000
10,000		 2021
£
-
250,000
250,000
2021
£
-
-		 2020
£
-
5,500
5,500
2020
£
-
-		 2019
£
7,500
16,450
23,950
2019
£
-
-		 2018
£
142,350
347,180
489,530
2018
£
-
-

Management of heritage assets

Seven Stories complies fully with the standards required by the Museum Accreditation scheme, having first become an Accredited museum in 2008. Accreditation was renewed with National Styling in 2016. The prime instrument of collection management is the Collection Management Policy, which Seven Stories executes on behalf of Seven Stories, The National Centre for Children’s Books Collection Trust. Seven Stories and the Collection Trust have also approved the following related policies, covering all areas of collection management:

Collection Development Policy Collection Information Policy Collection Access Policy Collection Care and Conservation Policy.

Nature and scale of heritage assets

Seven Stories is the only institution in the UK actively working to collect, preserve, conserve, exhibit and make available original manuscripts, artwork and related pre- and post- publication materials by the creators of modern and contemporary British books for children from the 1930s to the present day. The charity began collecting in 1996 and the Collection now comprises over 140 individual collections representing (to varying extents) the work of over 250 different authors, illustrators, editors and publishers and an estimated 35,000 books. Much of the work has been donated by the creators of the work or their families, though an acquisition budget coupled with external fundraising from sources including the Heritage Lottery Fund, the Art Fund, the ACE/V&A Purchase Grant Fund and the Friends of the National Libraries, has enabled a number of significant purchases.

36

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

The nature and extent of the holdings of original material varies from work relating to a single title to substantial collections which document an entire career, and may include business records and correspondence with publishers, as well as manuscripts and artwork in various stages. A wide range of genres and formats is covered. Fantasy, historical fiction, picture books and drama are particularly well represented.

Among the most extensive writers’ archives are those of Elisabeth Beresford, Peter Dickinson, Berlie Doherty, Diana Wynne Jones, Jan Mark, Michael Morpurgo, Beverley Naidoo, Martin Waddell, Robert Westall, Ursula Moray Williams and David Wood. Many others are also represented by significant bodies of work – for example Leila Berg, Lucy Boston, Leon Garfield, Eva Ibbotson, Clive King, Philip Pullman, Michael Rosen, Catherine Storr and Geoffrey Trease. The Collection also includes the largest Enid Blyton archive in public ownership (though sadly only a small proportion of her enormous output survives in manuscript or typescript form).

Around 120 illustrators are currently represented by original work, in a wide variety of techniques – from wood engraving (John Lawrence) to digital art (Chris Haughton) - and formats, from illustrated fiction to pop-ups. The most extensive collections include the Judith Kerr archive, comprising artwork for 24 titles, including The Tiger who Came to Tea (1968) and all of the Mog series (1970-2002) and the Helen Craig archive, which contains complete preparatory and finished artwork for 18 titles in the popular Angelina Ballerina series. Other extensive and/or highly significant holdings include work by – among others - Edward Ardizzone, Judy Brook, Faith Jaques, Harold Jones and Kim Lewis.

Acquisition of assets

Seven Stories, on behalf of the Collection Trust, is continuing to collect the following types of material dating from c. 1930 to the present day. Representative examples of work by seminal figures from earlier periods may be collected from time to time, where these provide a context for more recent work:

Original artwork and manuscripts by British writers and illustrators for children, in whatever format they were created, including new media

Pre- and post-publication materials

Related materials: e.g. correspondence, reviews, articles

Books in all their forms - including fiction and non-fiction, picture books, poetry, drama and prose, published work in new media formats, including audio and video tape, CD and DVD, and e-books.

Acquisition decisions are made with reference to a Collection Development Policy (updated 2015). Current priorities include:

Work by or representing groups of people outside the mainstream of publishing for children, in particular work by authors and illustrators of non-white British origin.

Poetry - currently a significant weakness

Illustration – building on the strengths of the existing holdings

Young fiction – work aimed at children aged 7-11, in particular by more popular authors First edition copies (where available) of texts represented by artwork and archival material in the Collection.

Preservation of assets

The charity is responsible for the care and conservation of the Collection under the terms of the management agreement with the Collection Trust. The collection care policy covers all aspects of preservation and conservation, from the moment an object enters the Collection, through storage, handling, display, loan, etc.

The policy is designed to ensure that Collection care at Seven Stories complies as far as possible with widely established standards and practices within the museums and archives community in Britain, for example BS5454, the ACE Accreditation Scheme, and Benchmarks for Collection Care.

37

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

It sets standards and expectations in the following areas:

Collection Content and Condition Monitoring Premises, Storage and Housekeeping Preventive conservation, including environmental monitoring and control, and integrated pest management Handling and Repackaging Remedial Conservation Disaster Planning.

It also covers best practice in digitisation, exhibitions, and transport of collections.

Disposal of assets

By definition, the Collection Trust has a long-term purpose and holds collections in trust for society in relation to its stated objectives. The Board of Trustees therefore accepts the principle that sound curatorial reasons for disposal must be established before consideration is given to the disposal of any items in the Collection. Full details of the procedures to be followed in the event of a decision to dispose are given in the Collection Development Policy.

13. Fixed asset investments

Group
Cost or valuation
At 1 April 2021
Revaluations
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021		 Listed
securities
£
8,185
1,844
10,029
10,029
8,185

38

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

13. Fixed asset investments (continued)

Charity
Cost or valuation
At 1 April 2021
Revaluations
At 31 March 2022
Net book value
At 31 March 2022
At 31 March 2021
Principal subsidiaries		 Investments
in
subsidiary
companies
£
1
-
1
1
1		 Listed
securities
£
8,185
1,844
10,029
10,029
8,185		 Total
£
8,186
1,844
10,030
10,030
8,186

The following were subsidiary undertakings of the charity:

Names Company Charity Holding Included in Included in
number registration consolidation
number
Seven Stories Trading Limited 04177830 n/a 100% Yes
Seven Stories, The National Centre for n/a 1115167 100% Yes
Children's Books Collections Trust
The financial results of the subsidiaries for the year were:
Names Income Expenditure Profit/(Loss) Net assets
£ £ / Surplus/ £
(Deficit) for
the year
£
Seven Stories Trading Limited 274,571 (200,031) 91,285 91,286
Seven Stories, The National Centre for 939,510 (1,742) 937,768 4,512,905
Children's Books Collections Trust

The financial results of the subsidiaries for the year were:

39

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

14. Stocks

Books and merchandise
Cafe food and drink stock
Excess donated Collection assets held for
resale
15.
Debtors
Due within one year
Trade debtors
Amounts owed by group undertakings
Other debtors
Prepayments and accrued income		 Group
2022
£
24,616
2,353
20,000
46,969
Group
2022
£
48,257
-
1,463
62,129
111,849		 Group
2021
£
34,362
4,238
-
38,600
Group
2021
£
29,985
-
13,324
110,091
153,400		 Charity
2022
£
-
-
20,000
20,000
Charity
2022
£
40,556
5,700
1,463
60,327
108,046		 Charity
2021
£
-
-
-
-
Charity
2021
£
11,324
47,834
13,324
109,147
181,629

40

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

16. Creditors: amounts falling due within one year

Trade creditors
Amounts owed to group undertakings
Other taxation and social security
Other creditors
Accruals and deferred income
Deferred income at 1 April 2021
Resources deferred during the year
Amounts released from previous periods		 Group
2022
£
40,354
-
11,693
11,325
175,073
238,445
Group
2022
£
171,005
670,972
(764,157)
77,820		 Group
2021
£
106,165
-
19,637
18,383
243,255
387,440
Group
2021
£
61,001
150,022
(40,018)
171,005		 Charity
2022
£
26,443
14,834
11,693
11,325
166,013
230,308
Charity
2022
£
169,619
670,972
(763,960)
76,631		 Charity
2021
£
101,518
-
18,931
18,383
237,522
376,354
Charity
2021
£
61,001
148,636
(40,018)
169,619

41

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17. Statement of funds Statement of funds - current year

Unrestricted
funds
Designated
funds
Designated
funds
General funds
General funds
Total
Unrestricted
funds
Restricted
capital funds
Building
purchase
Building
improvements
and purchase of
other assets
Historic
collections		 Balance at 1
April 2021
£
10,249
393,023
403,272
750,156
844,971
3,575,137
5,170,264		 Income
£
-
1,383,836
1,383,836
-
-
939,510
939,510		 Expenditure
£
-
(1,516,444)
(1,516,444)
-
(174,467)
(1,742)
(176,209)		 Transfers
in/out
£
-
(60,948)
(60,948)
-
60,948
-
60,948		 Gains/
(Losses)
£
-
1,844
1,844
-
-
-
-		 Balance at
31 March
2022
£
10,249
201,311
211,560
750,156
731,452
4,512,905
5,994,513

42

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17.
Statement of funds (continued)
Balance at 1
April 2021
£
Restricted funds
Collecting
Cultures
-
Unwin Charitable
Trust
15,000
British Council
2,639
Helen Bailey
1,600
Heritage Lottery
Fund - WSCF
19,000
Gillian Dickinson
45,473
BBC Children in
Need
6,235
Foyle - WSCF
9,900
Garfield Weston
50,000
St Nicholas'
Education Trust
5,254
Wolfson
76,550
Well Newcastle
Gateshead
1,293
National Lottery
Heritage Fund -
Covid-19
19,036
LNER - On Board
With Stories
8,868
Guy Readman
15,000
Community
Family Hub East
8,791
Shears
Foundation
833
Esmee Fairbairn
-
Other Funds
4,920
290,392
Total of funds
5,863,928		 17.
Statement of funds (continued)
Balance at 1
April 2021
£
Restricted funds
Collecting
Cultures
-
Unwin Charitable
Trust
15,000
British Council
2,639
Helen Bailey
1,600
Heritage Lottery
Fund - WSCF
19,000
Gillian Dickinson
45,473
BBC Children in
Need
6,235
Foyle - WSCF
9,900
Garfield Weston
50,000
St Nicholas'
Education Trust
5,254
Wolfson
76,550
Well Newcastle
Gateshead
1,293
National Lottery
Heritage Fund -
Covid-19
19,036
LNER - On Board
With Stories
8,868
Guy Readman
15,000
Community
Family Hub East
8,791
Shears
Foundation
833
Esmee Fairbairn
-
Other Funds
4,920
290,392
Total of funds
5,863,928		 17.
Statement of funds (continued)
Balance at 1
April 2021
£
Restricted funds
Collecting
Cultures
-
Unwin Charitable
Trust
15,000
British Council
2,639
Helen Bailey
1,600
Heritage Lottery
Fund - WSCF
19,000
Gillian Dickinson
45,473
BBC Children in
Need
6,235
Foyle - WSCF
9,900
Garfield Weston
50,000
St Nicholas'
Education Trust
5,254
Wolfson
76,550
Well Newcastle
Gateshead
1,293
National Lottery
Heritage Fund -
Covid-19
19,036
LNER - On Board
With Stories
8,868
Guy Readman
15,000
Community
Family Hub East
8,791
Shears
Foundation
833
Esmee Fairbairn
-
Other Funds
4,920
290,392
Total of funds
5,863,928		 Income
£
6,000
-
-
13,400
-
-
16,317
-
-
11,489
-
1,727
-
-
-
-
4,167
13,898
7,076
74,074
2,397,420		 Expenditure
£
(222)
(9,000)
-
(13,629)
-
-
(15,312)
-
-
(14,553)
(18,787)
(2,253)
(8,237)
(5,622)
(13,480)
(2,970)
(5,000)
-
(4,063)
(113,128)
(1,805,781)		 Transfers
in/out
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-		 Gains/
(Losses)
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,844		 Balance at
31 March
2022
£
5,778
6,000
2,639
1,371
19,000
45,473
7,240
9,900
50,000
2,190
57,763
767
10,799
3,246
1,520
5,821
-
13,898
7,933
Balance at 1
April 2021
£
-
15,000
2,639
1,600
19,000
45,473
6,235
9,900
50,000
5,254
76,550
1,293
19,036
8,868
15,000
8,791
833
-
4,920
290,392
5,863,928
251,338
6,457,411

43

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17.
Statement of funds (continued)
Statement of funds - prior year
Balance at
1 April 2020
£
Income
£
Unrestricted
funds
Designated
funds
Designated
funds
10,249
-
General funds
General funds
194,592
1,431,195
Total
Unrestricted
funds
204,841
1,431,195
Restricted
capital funds
Building
purchase
750,156
-
Building
improvements
and purchase of
other assets
992,055
-
Historic
collections
3,324,187
250,195
5,066,398
250,195		 Expenditure
£
-
(1,215,505)
(1,215,505)
-
(147,084)
(1,707)
(148,791)		 Transfers
in/out
£
-
(18,687)
(18,687)
-
-
2,462
2,462		 Gains/
(Losses)
£
-
1,428
1,428
-
-
-
-		 Balance at
31 March
2021
£
10,249
393,023
403,272
750,156
844,971
3,575,137
5,170,264

44

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17. Statement of funds (continued)

Balance at
1 April 2020
£
Restricted funds
Collecting Cultures
(7,500)
Eyre Family
Foundation
(4,330)
Unwin Charitable
Trust
7,500
British Council
5,000
Helen Bailey
8,670
Heritage Lottery
Fund - WSCF
6,275
Gillian Dickinson
19,000
BBC Children in
Need
(5,900)
Foyle - WSCF
45,903
Garfield Weston
5,284
St Nicholas'
Education Trust
9,900
Wolfson
50,000
Well Newcastle
Gateshead
-
National Lottery
Heritage Fund -
Covid-19
76,550
LNER - On Board
With Stories
10,500
Guy Readman
-
Community Family
Hub East
-
Shears Foundation
-
Esmee Fairbairn
-
Other Funds
4,429
231,281
Total of funds
5,502,520		 Income
£
Expenditure
£
-
(716)
16,041
(13,820)
-
(7,500)
10,000
-
1,225
(7,256)
5,200
(9,875)
-
-
-
-
-
(430)
19,388
(18,437)
-
-
-
-
13,254
(8,000)
-
-
4,500
(13,707)
48,300
(29,264)
14,600
(5,732)
15,000
-
10,000
(1,209)
11,642
(10,318)
169,150
(126,264)
1,850,540
(1,490,560)		 Transfers
in/out
£
8,216
2,109
-
-
-
-
-
5,900
-
-
-
-
-
-
-
-
-
-
-
-
16,225
-		 Gains/
(Losses)
£
Balance at
31 March
2021
£
-
-
-
-
-
-
-
15,000
-
2,639
-
1,600
-
19,000
-
-
-
45,473
-
6,235
-
9,900
-
50,000
-
5,254
-
76,550
-
1,293
-
19,036
-
8,868
-
15,000
-
8,791
-
5,753
-
290,392
1,428
5,863,928		 Gains/
(Losses)
£
Balance at
31 March
2021
£
-
-
-
-
-
-
-
15,000
-
2,639
-
1,600
-
19,000
-
-
-
45,473
-
6,235
-
9,900
-
50,000
-
5,254
-
76,550
-
1,293
-
19,036
-
8,868
-
15,000
-
8,791
-
5,753
-
290,392
1,428
5,863,928
290,392
5,863,928

45

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17. Statement of funds (continued)

Restricted capital funds:

Building purchase - funds allocated solely for the purchase of the buildings at 30 - 34 Lime Street, which were converted into the Seven Stories Visitor Centre.

Building improvements and purchase of other assets - funds allocated for the improvement of the buildings at 30 - 34 Lime Street, which were converted into the Seven Stories Visitor Centre and the purchase of fixtures & fittings within the building.

Historic collections relate to the heritage assets held within Seven Stories, The National Centre for Children's Books Collection Trust.

Restricted funds:

Eyre Family Foundation – support for our learning and participation work.

Unwin Charitable Trust - towards the direct costs of preparing collection items for use in our exhibition and learning programmes for 12 months.

British Council – grant to fund an artist in residence event at Seven Stories with a Polish illustrator.

Helen Bailey - to support a new creative writing project for schools.

Heritage Lottery Fund WSCF - to provide funding for development of new exhibition space.

Gillian Dickinson - to support the young people's talent development programme.

BBC Children in Need - to deliver community activity with educational and well-being outcomes in the East End of Newcastle.

Foyle Foundation - to provide funding for development of our new exhibition space.

Garfield Weston Foundation - for exhibition co-curation and touring programme.

St Nicholas Education Trust – to support Reader in Residence programme at Byker and St Lawrance Primary

Wolfson Foundation - to provide funding for development of our new exhibition space.

Well Newcastle Gateshead – to deliver Food Stories multigenerational project in the East End.

National Lottery Heritage Fund re Covid-19 - Covid 19 Emergency Funding to cover working from home adaptations and Covid safety changes to Visitors Centre and City Library.

LNER - On Board with Stories - a programme of creative learning activities using books to support babies born during lockdown and their parents/carers.

Guy Readman - reader in Residence programme with Central Walker Primary School and West Walker Primary School.

Community Family Hub East - to provide Welcome to the World story packs 1) for pregnant mums and new babies born in East Newcastle; 2) for families participating in the Books for Babies courses; and 3) to families across East Newcastle to celebrate World Book Day.

Other funds relates to grants from:

Holocaust Memorial Fund; Jeremy Beecham Fund; Friends of the National Lottery; Sebastian Walker

46

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

17. Statement of funds (continued)

Fund for Collection; The Shears Foundation; The Pilgrim Trust; and ISN.

Transfers between funds largely represent amounts spent on restricted capital assets in the year.

18. Summary of funds

Summary of funds - current year


Designated
funds
General funds
Restricted
capital funds
Restricted funds		 Balance at 1
April 2021
£
10,249
393,023
5,170,264
290,392
5,863,928		 Income
£
-
1,383,836
939,510
74,074
2,397,420
Income
£
-
1,431,195
250,195
169,150
1,850,540		 Expenditure
£
-
(1,516,444)
(176,209)
(113,128)
(1,805,781)
Expenditure
£
-
(1,215,505)
(148,791)
(126,264)
(1,490,560)		 Transfers
in/out
£
-
(60,948)
60,948
-
-
Transfers
in/out
£
-
(18,687)
2,462
16,225
-		 Gains/
(Losses)
£
-
1,844
-
-
1,844
Gains/
(Losses)
£
-
1,428
-
-
1,428		 Balance at
31 March
2022
£
10,249
201,311
5,994,513
251,338
6,457,411
Balance at
31 March
2021
£
10,249
393,023
5,170,264
290,392
Summary of funds - prior year
Designated
funds
General funds
Restricted
capital funds
Restricted funds		 Balance at
1 April 2020
£
10,249
194,592
5,066,398
231,281
5,502,520
5,863,928

47

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

19. Analysis of net assets between funds

Analysis of net assets between funds - current year

Unrestricted
funds
2022
£
Tangible fixed assets
281,025
Intangible fixed assets
25,795
Fixed asset investments
10,028
Heritage assets
10,000
Current assets
115,856
Creditors due within one year
(231,144)
Total
211,560
Analysis of net assets between funds - prior year
Unrestricted
funds
2021
£
Tangible fixed assets
220,271
Fixed asset investments
8,185
Heritage assets
-
Current assets
557,456
Creditors due within one year
(382,640)
Total
403,272		 Restricted
funds
2022
£
-
-
-
-
251,338
-
251,338
Restricted
funds
2021
£
-
-
-
290,392
-
290,392		 Restricted
capital
funds
2022
£
1,481,608
-
-
4,503,187
17,018
(7,300)
5,994,513
Restricted
capital funds
2021
£
1,595,127
-
3,562,792
17,145
(4,800)
5,170,264		 Total
funds
2022
£
1,762,633
25,795
10,028
4,513,187
384,212
(238,444)
6,457,411
Total
funds
2021
£
1,815,398
8,185
3,562,792
864,993
(387,440)
5,863,928
Analysis of net assets between funds - prior
Tangible fixed assets
Fixed asset investments
Heritage assets
Current assets
Creditors due within one year
Total

48

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

20. Reconciliation of net movement in funds to net cash flow from operating activities

Net income for the year (as per Statement of Financial Activities)
Adjustments for:
Depreciation charges
Amortisation charges
(Gains)/losses on investments
Donation of assets acquired
(Increase)/decrease in stocks
Decrease in debtors
(Decrease)/increase in creditors
Net cash provided by/(used in) operating activities
21.
Analysis of cash and cash equivalents
Cash in hand
22.
Analysis of changes in net debt
At 1 April
2021
£
Cash at bank and in hand
672,993
672,993		 Group
2022
£
593,483
221,818
2,762
(1,844)
(949,495)
(8,369)
41,551
(148,995)
(249,089)
Group
2022
£
225,394
Cash flows
£
(447,599)
(447,599)		 Group
2021
£
361,408
165,252
-
(1,428)
(250,000)
2,137
182,753
150,196
610,318
Group
2021
£
672,993
At 31 March
2022
£
225,394
225,394

49

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

23. Contingent liabilities

There are legal charges over the land and buildings at 30-34 Lime Street, Newcastle upon Tyne, in favour of Newcastle City Council and the Arts Council England, which arose from capital grants awarded to the charity.

The grants are non-repayable provided that the property is not disposed of or used for purposes other than non-profit making culturally related activities, or the charity ceases to operate. The security given by the charges will be released after 25 years in 2029 by Arts Council England and 60 years in 2064 by Newcastle City Council.

24. Pension commitments

The group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £28,021 (2021: £29,142). Contributions totalling £4,951 (2021: £6,440) were payable to the fund at the balance sheet date and are included within creditors.

25. Operating lease commitments

At 31 March 2022 the group and the charity had commitments to make future minimum lease payments under non-cancellable operating leases as follows:

Not later than 1 year
Later than 1 year and not later than 5 years		 Group
2022
£
31,550
64,631
96,181		 Group
2021
£
28,110
88,000
116,110

50

DocuSign Envelope ID: 4A8991AE-342E-456B-AE22-FB2371F49E8F

Seven Stories, The National Centre for Children's Books Limited

(A company limited by guarantee)

Notes to the financial statements For the year ended 31 March 2022

26. Related party transactions

No member of the board received any remuneration during the current or prior year.

During the year, no Trustees (2021: 0) received reimbursed expenses (2021: £nil) in respect of travel and subsistence costs.

During the course of the year, the charity made payments on behalf of the subsidiary, Seven Stories, The National Centre for Children's Books Collection Trust, totalling £2,500 (2021: £3,200). The amount owed at the year end, included in the charity's debtors, totalled £5,700 (2021: £3,200). During the year the charity made recharges of £144,089 (2021: £197,091) to its subsidiary, Seven Stories Trading Limited, and the subsidiary made purchases totalling £203,557 (2021: £187,996) from the charity. The amount owed at the year end, included in the charity's creditors, totalled £14,834 (2021: £47,834 debtor).

The charitable company has received donations of £46,628 (2021: £nil) from its subsidiary undetaking, Seven Stories Trading Limited, in the year. No amounts remain outstanding in respect of these donations at the balance sheet date.

27. Controlling party

The charity is controlled by the Board of Trustees.

51