## **IoM Communications Limited**
COMPANY REGISTRATION No: 3285009 CHARITY REGISTRATION No: 1059475
## **ANNUAL REPORT AND FINANCIAL**
## **STATEMENTS**
Year ended 31 December 2020
**IoM Communications Limited**
## **Year ended 31 December 2020**
## **INDEX**
|**INDEX**||
|---|---|
||**Page**|
|General information|1|
|Directors’ report and trustees’ report|2|
|Independent auditor’s report|7|
|Statement of financial activities|10|
|(including income and expenditure account)||
|Balance sheet|11|
|Statement of cash flows|12|
|Notes to the financial statements|13 - 18|
**IoM Communications Limited**
**Year ended 31 December 2020**
## **GENERAL INFORMATION**
|**Directors**|Mr J C H Lewis|Chairman|
|---|---|---|
||Dr C A Church|Chief Executive|
||Dr A T Cole (resigned 7|October 2020)|
||Dr M J May (resigned 31 December 2020)||
||Prof L Greer (resigned 7 October 2020)||
||Dr S Garwood (resigned 13 May 2020)||
||Dr A Tinker (resigned 7|October 2020)|
|**Company secretary**|Ms J Bugajeva||
|**Registered office**|297 Euston Road||
||London||
||NW1 3AD||
|**Charity registration number**|1059475||
|**Company registration number**|3285009 (England and Wales)||
|**Bankers**|Santander UK plc||
||4thFloor||
||100 Ludgate Hill||
||London||
||EC4M 7RE||
|**Solicitors**|Allen & Overy||
||1 Bishop’s Square||
||London||
||E1 6AD||
|**Auditors**|RSM UK Audit LLP||
||25 Farringdon Street||
||London||
||EC4A 4AB||
Page 1
**IoM Communications Limited**
## **Year ended 31 December 2020**
## **DIRECTORS’ REPORT AND TRUSTEES’ REPORT**
## **INTRODUCTION**
The Trustees are pleased to present their annual directors’ report together with the financial statements of the charity for the year ending 31 December 2020 which are also prepared to meet the requirements for a directors’ report and accounts for Companies Act purposes.
The financial statements comply with the Charities Act 2011, the Companies Act 2006, the Memorandum and Articles of Association, and 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).
This report contains the following information:
- Reference and administrative details of the charity, its trustees and advisers
- Structure, governance and management
- Public benefit, objectives and activities
- Achievements and performance
- Financial review
- Plans for future periods
- Auditors
- Disclosure of information to auditors
IOM Communications Limited is a charitable trading company limited by shares. Names of the directors who served throughout the year are stated on page 1. The directors of the company are also charity trustees for the purpose of Charity Law.
According to the register maintained as required under the Companies Act 2006, none of the directors had any interest in the share capital of the company.
## **STRUCTURE, GOVERNANCE AND MANAGEMENT**
The company was incorporated on 22 November 1996 and commenced trading on 1 January 1999. It operates in accordance with its memorandum and articles of association and is a wholly owned subsidiary of the Institute of Materials, Minerals and Mining.
The governance of the company is vested in the directors who are also trustees. The directors are appointed by either the Council of the Institute of Materials, Minerals and Mining or the current directors of the company. Not more than three out of a maximum of eight directors can be members of the Executive Board or members of the Institute’s staff. The day to day management of the company is delegated to staff employed by the Institute who report to the chief executive.
Induction meetings are held for new directors to ensure that they understand their responsibilities as trustees of the charity. The induction process provides trustees with information about the role of the board, the organisational structure of the company and its relationship with the Institute. The objects of the company together with the mission statement and corporate strategies are explained. Each trustee is provided with an information pack and points of access to further details. Ongoing training is made available to trustees in relation to the individual responsibilities undertaken by them.
The board meets at least three times during the year to review strategy and approve operating plans and budgets. In addition, the directors have ad hoc meetings to deal with other matters as they arise.
Page 2
**IoM Communications Limited**
## **Year ended 31 December 2020**
## **DIRECTORS’ REPORT AND TRUSTEES’ REPORT (continued)**
## **STATEMENT OF DIRECTORS’ RESPONSIBILITIES**
The directors have overall responsibility for ensuring that the company has appropriate systems of control, financial and otherwise. They are responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The directors have introduced a formal risk management process to enable it to assess business risks and implement risk management strategies on a regular basis.
It involves identifying the types of risks the company faces, prioritising them in terms of potential impact and likelihood of occurrence, and identifying means of mitigating the risks. As part of this process the directors review the adequacy of the company’s current internal controls. The systems of internal control are designed to provide reasonable, but not absolute, assurance against material misstatement or loss. They include:
- a strategic plan and an annual budget approved by the directors;
- regular consideration by the directors of financial results, variance from budgets, non-financial performance indicators and benchmarking reviews;
- delegation of authority and segregation of duties.
Company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources of the charity for that period. In preparing those financial statements, the directors are required to:
- select suitable accounting policies and apply them consistently;
- observe the methods and principles in the Charities SORP;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue to operate.
The directors are responsible for:
- preparing the trustees’ report and the financial statements in accordance with applicable law and United Kingdom accounting standards (FRS 102);
- keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that annual financial statements comply with the Companies Act 2006;
- safeguarding the assets of the charitable company and hence taking reasonable steps for the prevention and detection of fraud and other irregularities;
- The maintenance and integrity of the corporate and financial information included on the company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
## **PUBLIC BENEFIT, OBJECTIVES AND ACTIVITIES**
Materials form an integral and important part of all our lives. The materials cycle covers the exploration and extraction of raw materials from the earth, processing them into industrial/engineered materials, application of these materials, recycling of waste and the ultimate disposal of waste in an environmentally friendly way. It is more important than ever that the scientists, engineers and technologists involved in the materials cycle are qualified and experienced to make the best use of materials in terms of economics, efficiency and sustainability for the benefit of the public. The charitable company makes a major contribution to this through its objectives and activities.
Page 3
**IoM Communications Limited**
**Year ended 31 December 2020**
## **DIRECTORS’ REPORT AND TRUSTEES’ REPORT (continued)**
The charity has referred to the guidance contained in the Charity Commission’s guidance on public benefit when reviewing its aims and objectives and in planning future activities. In particular the directors consider how planned activities will contribute to the aims and objectives it has set.
The objectives of the company are to:-
- Promote and develop all aspects of the “materials cycle”.
- Generate funds to enable the company’s parent organisation to carry out its objects, which are of a similar nature to those of the company.
These objectives are achieved by the following activities that provide information and generate income:-
- The publication of learned journals and books through an outsourcing arrangement. Income is generated from royalties based on any sales revenue received from publishing on paper and electronically.
- The publication of various magazines for members of the Institute. Income is generated from subscriptions, advertising revenue and a contribution from the Institute for supplying copies to its members.
- The organisation of conferences on behalf of the Institute, exhibitions, training services and technology award competitions. Income is generated from registration fees and sponsorship.
- The provision of information, library and consulting services, through the Materials Information Service (MIS), on a wide range of materials, minerals and mining activities. Income is generated from subscriptions, consultancy work and project income from a number of government agencies.
## **Strategic plan**
In the company’s strategic plan are listed the vision, mission and corporate aims.
## **Vision**
To be recognised as the global information provider for everyone involved in the materials cycle.
## **Mission**
To continue to be a major income provider to the Institute of Materials, Minerals and Mining (IOM3) by:
- Maintaining and developing existing revenue streams.
- Developing new revenue streams consistent with the aims and mission of IOM3.
## **Corporate aims**
- Create the necessary internal organisation to manage, develop and increase income from government funded projects.
-
-
-
- Generate income from new areas of the materials cycle.
- Improve profitability through the use of e-deliverables.
- Develop more creative approaches to commercial sponsorship.
- Improve performance of existing activities.
Page 4
**IoM Communications Limited**
**Year ended 31 December 2020**
## **DIRECTORS’ REPORT AND TRUSTEES’ REPORT (continued)**
## **ACHIEVEMENTS AND PERFORMANCE, INCORPORATING FINANCIAL REVIEW**
The directors are pleased to report an operating surplus before donations of £816k for the year. This enabled the company to donate £816k (2019 - £716k) to the Institute of Materials Minerals & Mining. The plans for the year were to expand digital journal and magazine opportunities, review conference strategy and launch new training courses.
Although 2020 overall has been a successful year for the company with a strong contribution from publishing activities, Covid19 pandemic has a significant impact on company’s conference and training activities.
Given the challenging year, publishing activities performed well throughout 2020 with only 2.5% decrease in income. These activities continue to contribute the greatest proportion of the operating surplus before donations. In 2020 publishing activities generated a surplus of £1,039k (2019 - £953k). The decrease in revenue was primarily due to the challenging in-print advertising market and reduction in the number of corporate subscribers to the Materials World magazine. Running costs of publishing activities remained consistent with those of 2019.
Due to Covid-19 all of 2020 events were either cancelled or postponed to 2021 and the activity only generated £10k in income (2019 - £671k). A number of webinars and small online events took place in the second half of the year but most of them were free of charged and provided as a benefit to members of The Institute of Materials, Minerals and Mining.
A review of Information Services activity and Industry Affiliate Scheme in particular, took place in 2020. It was decided to terminate Industry Affiliate Scheme as at 31 March 2021 and launch IOM3 Business Partner Programme in spring 2021 as an enhanced replacement of the Industry Affiliate Scheme. Business Partner Programme will be administered by The Institute of Materials, Minerals and Mining.
Training Academy activity was temporarily suspended in spring 2020 while the staff and tutors relaunched a number of courses in an online format. Additionally, a number of regular corporate clients reduced their training budget as a result of Covid19 pandemic. This resulted in a 37% reduction in income generated during the year (2020 - £187k, 2019 - £296k).
As reported above, the operating surplus before donations amounted to £816k. During 2021 the companies activities will be gradually transferred to The Institute of Materials, Minerals and Mining and Materials Institute Services Ltd.
## **RESERVES POLICY**
The board’s policy is to retain sufficient reserves to cover the working capital requirements of the company and develop new income generating opportunities when they arise. Surplus funds are distributed to the Institute of Materials, Minerals and Mining (IOM3).
After donating £816k (2019 - £716k) to IOM3, less than £1k was added to reserves and the company ended the financial year with net assets of £343k (2019 - £342k). Having reviewed the company’s operating plans and budgets, the directors consider the reserves at 31 December 2020 of £343k (2019 - £342k) to be adequate for the forthcoming year.
Page 5
**IoM Communications Limited**
**Year ended 31 December 2020**
## **DIRECTORS’ REPORT AND TRUSTEES’ REPORT (continued)**
## **PLANS FOR FUTURE PERIODS**
After consultation with the trustees of the ultimate parent charity, The Institute of Materials, Minerals and Mining, it was decided to wind down the operations of IOM Communications Ltd by the end of 2021. Publishing, conference, training and information services activities are being transferred to The Institute of Materials, Minerals and Mining to be managed by it. Marketing, advertising and exhibition activities are being transferred to Materials Institute Services Limited, a wholly owned trading subsidiary, to be managed by it. Shares in Materials Institute Services Limited and other balance sheet items existing at 31 December 2021 will be transferred to The Institute of Materials, Minerals and Mining. The company will become dormant after this date.
## **GOING CONCERN**
A decision was taken in January 2021 to transfer trade and assets to either the parent charity, The Institute of Materials, Minerals and Mining or a fellow subsidiary, Materials Institute Services Limited by the end of the next financial year, from which point the charity will cease to trade. Therefore the financial statements have been prepared on a non-going concern basis. No adjustments are necessary to amounts included in these financial statements as a result of the application of the non-going concern basis of accounting.
## **AUDITOR**
RSM UK Audit LLP has indicated its willingness to continue in office.
## **STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS**
In so far as the directors who were in office on the date of approval of these financial statements are aware:
- there is no relevant audit information of which the charitable company’s auditor is unaware; and
- the directors have taken all steps they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.
## **SMALL COMPANY PROVISIONS**
This report has been prepared in accordance with the special provisions applicable to companies entitled to the small companies’ exemption.
This report was approved by the board on 26 May 2021.
9 June 2021 Dr C A Church Director
Page 6
## **INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF IOM COMMUNICATIONS LIMITED**
## **Opinion**
We have audited the financial statements of IOM Communications Limited (the ‘charitable company’) for the year ended 31 December 2020 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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:
- give a true and fair view of the state of the charitable company’s affairs as at 31 December 2020 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Companies Act 2006.
## **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 charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
We draw attention to note 2b of the financial statements which describes the preparation of the financial statements on a nongoing concern basis. As described in note 2b, the directors took the decision to transfer the trade and assets to either the parent charity, The Institute of Materials, Minerals and Mining or a fellow subsidiary, Materials Institute Services Limited by the end of the next financial year, from which point the charity will cease to trade. Therefore the financial statements have been prepared on the non-going concern basis of accounting. Our opinion is not modified on this matter.
## **Other information**
The other information comprises the information included in the Directors’ Report and Trustees’ Report other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the Directors’ Report and Trustees’ 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.
## **Opinions on other matters prescribed by the Companies Act 2006**
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Directors’ Report and Trustees’ Report, which includes the Directors’ Report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Directors’ Report included within the Directors’ and Trustees’ Report has been prepared in accordance with applicable legal requirements.
## **Matters on which we are required to report by exception**
In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors’ Report included within the Directors’ Report and Trustees’ Report.
**IoM Communications Limited**
## **Year ended 31 December 2020**
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of trustees’ remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit; or
- the Directors were not entitled to [prepare the financial statements in accordance with the small companies’ regime and take advantage of the small companies exemption from the requirement to prepare a Strategic Report or in preparing the Directors’ Report and Trustee’s report.
## **Responsibilities of trustees**
As explained more fully in the Statement of Trustees’ responsibilities set out on page 3, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.
## **Auditor’s responsibilities for the audit of the financial statements**
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
## **The extent to which the audit was considered capable of detecting irregularities, including fraud**
Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of noncompliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:
- obtained an understanding of the nature of the sector, including the legal and regulatory frameworks that the charitable company operates in and how the charitable company is complying with the legal and regulatory frameworks;
- inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
- discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.
Page 8
**IoM Communications Limited**
**Year ended 31 December 2020**
As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, Charities SORP (FRS 102), Companies Act 2006, Charities Act 2011, the charitable company’s governing document. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing the financial statements including the Directors’ and Trustees’ Report and remaining alert to new or unusual transactions which may not be in accordance with the governing documents.
There were no significant laws and regulations that have an indirect impact on the financial statements.
The audit engagement team identified the risk of management override of controls and as the area where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments, evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, challenging judgments and estimates.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
## **Use of our report**
This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
##
NICHOLAS SLADDEN (Senior Statutory Auditor) For and on behalf of RSM UK Audit LLP, Statutory Auditor Chartered Accountants 25 Farringdon Street London EC4A 4AB Date
Page 9
**IoM Communications Limited**
**Year ended 31 December 2020**
## **STATEMENT OF FINANCIAL ACTIVITIES (INCLUDING INCOME AND EXPENDITURE ACCOUNT)**
|
**Notes**
**Income**
Charitable activities
3
**Total income**
**Expenditure**
Charitable activities
3
Donation to The Institute of Materials, Minerals
and Mining
**Total expenditure**
4
**Net income and net movement in funds for**
**the year**
8
**Reconciliation of funds**
Total funds brought forward
**Total funds carried forward**|**Unrestricted Funds**
**2020**
**£**
**2019**
**£**
1,827,446
2,710,445
1,827,446
2,710,445
1,011,288
1,994,084
816,000
716,000
1,827,288
2,710,084
158
361
342,348
341,987
342,506
342,348|**Unrestricted Funds**
**2020**
**£**
**2019**
**£**
1,827,446
2,710,445
1,827,446
2,710,445
1,011,288
1,994,084
816,000
716,000
1,827,288
2,710,084
158
361
342,348
341,987
342,506
342,348|
|---|---|---|
|||2,710,445|
|||1,994,084
716,000|
|||2,710,084|
|||361
341,987|
|||342,348|
The Statement of Financial Activities includes all gains and losses recognised in the year.
Page 10
## **IoM Communications Limited**
## **Year ended 31 December 2020**
|**Year ended 31 December 2020**||||||
|---|---|---|---|---|---|
|**BALANCE SHEET**||Company number||03285009||
||**Notes**|**2020**||**2019**||
|||**£**||**£**||
|**Fixed assets**||||||
|Intangible assets|9|15,930||20,967||
|Investments|10|2||2||
|**Total fixed assets**||15,932||20,969||
|**Current** **assets**||||||
|Work in progress|11|258,317||214,688||
|Debtors|12|665,343||685,253||
|Cash at bank and in hand||36,898||75,079||
|**Total current assets**||960,649||975,020||
|**Liabilities**||||||
|Creditors: Amounts falling due within one year|13|633,975||(653,541)||
|**Net current assets**||326,674||321,479||
|**Total net assets**||342,606||342,448||
|**The funds of the charity**||||||
|Called up share capital|15|100||100||
|Unrestricted revenue reserves||342,506||342,348||
|**Total charity funds**|16|342,606||342,448||
The Trustees have prepared accounts in accordance with section 399 of the Companies Act 2006 and section 138 of the Charities Act 2011. These accounts are prepared in accordance with the special provisions of Part 15 of the Companies Act relating to small companies and constitute the annual accounts required by the Companies Act 2006 and are for circulation to members of the company.
The notes at pages 10 to 19 form part of these accounts.
Approved by the Trustees on 26 May 2021 and signed on behalf of the Trustees
9 June 2021 Dr C A Church Director
Page 11
**IoM Communications Limited**
## **Year ended 31 December 2020 STATEMENT OF CASHFLOWS**
|**Notes**
**Cash flows (used in)/from operating activities**
18
**Cash flows (used in)/from investing activities**
Purchase of intangible fixed assets
**Cash used in investing activities**
(Decrease)/increase in cash and cash equivalents in the year
Cash and cash equivalents at the beginning of the year
**Total cash and cash equivalents at the end of the year**|**2020**
**£**
**(38,181)**
-
**-**
**(38,181)**
75,079
**36,898**|**2019**
**£**
**41,013**
(11,102)|
|---|---|---|
|||**(11,102)**|
|||**29,911**
45,168|
|||**75,079**|
Page 12
**IoM Communications Limited**
**Year ended 31 December 2020 NOTES TO THE FINANCIAL STATEMENTS**
## 1. **Status**
IOM Communications Limited is a charitable trading company limited by shares (Registered Charity number 1059475, Company Registration number 3285009). The company’s registered office is 297 Euston Road, London, NW1 3AD.
## 2.
## **Accounting policies**
The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows:
## a) **Basis of preparation**
The financial statements have been prepared in accordance with 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) – (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.
IOM Communications Ltd meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historic cost or transaction value unless otherwise stated in the relevant accounting policy notes.
The financial statements are prepared in sterling, which is the functional currency of the charity. Monetary amounts in these financial statements are rounded to the nearest £1.
b) **Reduced disclosures**
In accordance with FRS102, the charity has taken advantage of the exemptions from the following d disclosure exemptions:
Section 33 “Related Party Disclosures” – Compensation for key management personnel.
## c) **Going concern**
A decision was taken in January 2021 to transfer trade and assets to either the parent charity, The Institute of Materials, Minerals and Mining or a fellow subsidiary, Materials Institute Services Limited by the end of the next financial year, from which point the charity will cease to trade. Therefore the financial statements have been prepared on a non-going concern basis. No adjustments are necessary to amounts included in these financial statements as a result of the application of the non-going concern basis of accounting.
## d) **Income**
Income is recognised when the charity has entitlements to the funds, any performance conditions attached to the items of income have been met, it is probable that the income will be received and the amount can be measured reliably.
Income from conferences represents the amount receivable in respect of the current year. Amounts received in respect of conferences to be run in future years are carried forward to the following year. Income from grants, where related to performance and specific deliverables, are accounted for as the charity earns the right to consideration by its performance.
Subscription income from magazines, industrial affiliates and information services represents the amount receivable in respect of current and past years. Amounts received in advance are carried forward to the following year and subscriptions in arrears have not been anticipated.
Other income is recognised where there is entitlement, certainty of receipt and the amount can be measured with sufficient reliability.
## e) **Expenditure**
Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably.
Page 13
**IoM Communications Limited**
## **Year ended 31 December 2020**
All expenditure is accounted for on accruals basis and has been classified under headings that aggregate all costs to the category. Where costs cannot be directly attributed to particular headings, they have been allocated to activities on a basis consistent with the use of resources.
## f) **Allocation of support costs**
Support costs are those functions that assist the work of the charity but do not directly undertake charitable activities. Support costs include back office costs, finance, personnel and governance costs which support IOM Communications Ltd activities. These costs have been allocated to the expenditure on charitable activities. The basis on which support costs are allocated is set out in note 5.
The charity does not directly employ any staff. All personnel working on the company’s activities are employed by The Institute of Materials, Minerals and Mining and their salaries are recharged to the charity at cost. The company operates from premises owned by the Institute and reimburses the Institute for the use of the premises, services and fixed assets at cost.
## g) **Intangible fixed assets**
Intangible fixed assets, including patents, are amortised at rates calculated to write off the assets on a straight line basis over their estimated useful economic lives. Where it is not possible to make a reliable estimate of the useful life of an intangible asset, the life shall not exceed five years. Impairment of intangible assets is only reviewed where circumstances indicate that the carrying value of an asset may not be fully recoverable.
## h) **Work in progress**
Work in progress is valued at cost and includes labour and overhead costs.
## i) **Debtors**
Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.
## j) **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.
## k) **Creditors and provisions**
Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.
## l) **Foreign currencies**
Assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at an internal rate of exchange ruling at the date of the transaction. All differences are taken to the income and expenditure account.
## m) **Reserves policy**
The board’s policy is to retain sufficient reserves to cover the working capital requirements of the company and develop new income generating opportunities when they arise. Surplus funds are distributed to the Institute of Materials, Minerals and Mining.
## n) **Financial instruments**
The charity has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised when the charity becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
## _Basic financial assets_
Basic financial assets, which include trade and other debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost
Page 14
**IoM Communications Limited**
## **Year ended 31 December 2020**
using the effective interest method unless the arrangement constitutes a financing transaction, where the financial asset is measured at the present value of the future receipts discounted at a market rate of interest.
## _Classification of financial liabilities_
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the charity after deducting all of its liabilities.
## _Basic financial liabilities_
Basic financial liabilities, including trade and other creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
## o) **Judgements and key sources of estimation uncertainty**
In the application of the charity’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The directors do not consider that there are any areas of key judgements or estimation uncertainty within these financial statements.
Page 15
**IoM Communications Limited**
## **Year ended 31 December 2020**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
|3.
**Income from charitable activities**
Publishing
Conferences
Information services
Technology improvement awards
Training services
**Cost of charitable trading activities**
Publishing
Conferences
Information services
Technology improvement awards
Training services
**Net contribution from trading activities**
Publishing
Conferences
Information services
Technology improvement awards
Training services
4
**Breakdown of costs of activities**
Direct costs
£
**Charitable activities**
Publishing
134,879
Conferences
28,399
Information services
5,818
Technology improvement
awards
-
Training services
44,700
Donation to the Institute
-
213,796|Selling &
distribution
£
-
(2,630)
1,600
-
-
-
(1,030)|Support
costs
£
360,442
218,595
30,194
-
189,291
-
798,522|**2020**
**£**
1,534,010
9,530
96,623
-
187,283
1,827,446
495,321
244,364
37,612
-
233,991
1,011,288
1,038,689
(234,834)
59,011
-
(46,708)
816,158
**Total**
**2020**
**£**
495,321
244,364
37,612
-
233,991
816,000
1,827,288|**2019**
**£**
1,575,165
671,375
114,962
52,581
296,362|
|---|---|---|---|---|
|||||2,710,445|
|||||622,258
644,612
349,992
97,737
279,485|
|||||1,994,084|
|||||952,907
26,763
(235,030)
(45,156)
16,877|
|||||716,361|
|||||**Total**
**2019**
**£**
622,258
644,612
349,992
97,737
279,485
716,000|
|||||2,710,084|
Page 16
**IoM Communications Limited**
## **Year ended 31 December 2020**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
|5
**Support cost breakdown**
**by activity**
Publishing
Conferences
Information services
Technology improvement
awards
Training services|Labour
costs
£
271,819
164,848
18,971
-
142,749
598,387|Establishment
costs
£
71,931
43,624
5,021
-
37,776
158,352|Administration
costs
£
16,692
10,123
6,202
-
8,766
41,783|**Total**
**2020**
**£**
360,442
218,595
30,194
-
189,291
798,522|**Total**
**2019**
**£**
462,009
230,471
306,227
53,350
136,575|
|---|---|---|---|---|---|
||||||1,188,632|
Labour costs are allocated to activities based on the cost of the estimated time spent on those activities. Establishment and administration costs are apportioned to activities on the basis of labour costs. All employees are employed by the parent charity, the Institute of Materials, Minerals & Mining. Audit fees are borne by the parent charity, the Institute of Materials, Minerals & Mining.
## 6. **Directors’ remuneration**
During the year no trustees were reimbursed for travel, meeting and related expenditure (2019 – 5 trustees – £3,793).
The company’s parent, The Institute of Materials, Minerals and Mining, paid £0 (2019 - £629) on behalf of the trustees for attending directors and other meetings.
The Charity considers its key management personnel comprise of the Trustees. No trustees have received any remuneration during the years ended 31 December 2020 and 2019.
Dr C A Church and Ms J Bugajeva are employed by the company’s parent, The Institute of Materials, Minerals and Mining.
## 7. **Related party transactions**
Dr A T Cole is a director and shareholder of Inspiratech 2000 Ltd, a company that has provided web related services to the Institute and its group companies over a number of years prior to his appointment as a director of IoM Communications Ltd. During the year, Inspiratech carried out services for the company to the value of £1,182 (2019 – £15,163) including VAT.
A balance of £73,406 was owed to the company’s subsidiary Materials Institute Services Ltd (MISL) at 31 December 2020 (2019 - £52,260). Movements during 2020 were: MISL expenses paid by IOM Communications Ltd - £1,145, cash transferred by MISL to IOM Communications Ltd - £10,000.
## 8.
|**Operating surplus**
Publishing
Conferences
Information services
Technology improvement awards
Training services
Other|**2020**
**£**
1,038,689
(234,834)
59,011
-
(46,708)
(816,000)
158|**2019**
**£**
952,907
26,763
(235,030)
-
16,877
(716,000)|
|---|---|---|
|||361|
Page 17
**IoM Communications Limited**
## **Year ended 31 December 2020 NOTES TO THE FINANCIAL STATEMENTS (continued)**
|9.
**Intangible fixed assets**
**Cost**
At 1 January 2020
Additions in the year
At 31 December 2020
**Amortisation**
At 1 January 2020
Charge for the year
At 31 December 2020
**Net book value**
31 December 2020
31 December 2019|**Patent**
**and**
**software**
**costs**
**£**
41,087
-
41,087
20,120
5,037
25,157
15,930
20,967|**Total**
**£**
41,087
-|
|---|---|---|
|||41,087
20,120
5,037|
|||25,157|
|||15,930|
|||20,967|
The directors reviewed intangible fixed assets for impairment and consider that no impairment provision is required.
## 10. **Investment in subsidiary**
IoM Communications Ltd has one wholly owned subsidiary organisation: Materials Institute Services Ltd (company number 2882544), a company limited by shares. IoM Communications Ltd holds 2 shares of £1 each in Materials Institute Services Ltd, which were transferred from the Institute of Materials, Minerals & Mining in the 2017. No premium was paid on acquisition.
|11.
**Work in progress**
Publishing
Conferences
Information services
Training services
12.
**Debtors**
Trade debtors
The Institute of Materials, Minerals and Mining
VAT recoverable
Prepayments and other accrued income
13.
**Creditors**
Trade creditors
Subscriptions and orders paid in advance
Other creditors and accruals
Materials Institute Services Ltd|**2020**
**£**
13,385
243,401
-
1,531
258,317
107,741
518,896
13,997
24,800
665,434
62,353
296,953
201,263
73,406
633,975|**2019**
**£**
405
206,408
6,457
1,418|
|---|---|---|
|||214,688|
|||274,150
358,881
1,933
19,823|
|||685,253|
|||87,509
387,165
126,607
52,260|
|||653,541|
Page 18
**IoM Communications Limited**
**Year ended 31 December 2020 NOTES TO THE FINANCIAL STATEMENTS (continued)**
|**Subscriptions and orders paid in advance**
At 1 January
Recognised in year
Provided for in year
At 31 December|**2020**
**£**
387,165
(122,877)
32,665
296,953|**2019**
**£**
265,186
(206,667)
328,646|
|---|---|---|
|||387,165|
## 14. **Corporation taxation**
The company is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.
## 15. **Share capital**
|**Share capital**|||
|---|---|---|
||**Number**|**Nominal**|
|||**value**|
|||**£**|
|Authorised, allotted, issued and fully paid|||
|Ordinary shares of £1 each|100|100|
|The company’s issued share capital is wholly owned by the Institute|of Materials, Minerals and Mining.||
|16.
**Reconciliation of movements in shareholders’**
**funds**
As at 1 January 2020
Surplus for the financial year
As at 31 December 2020|**2020**
**£**
342,448
158
342,606|**2019**
**£**
342,087
361|
|---|---|---|
|||342,448|
## 17. **Ultimate controlling party**
The Institute of Materials, Minerals and Mining (charity registration number 269275), a charity registered in England, is the ultimate controlling party. The Institute’s registered office address is 297 Euston Road, London. NW1 3AD. Consolidated financial statements for the group, which include the subsidiary charity’s accounts and list the principal activities and purposes of the Institute, are publicly available via the Institute’s website www.iom3.org
|18.
**Reconciliation of net movement in funds to net**
**cash flow from operating activities**
Net movement in funds
Add back amortisation charge
(Increase)/decrease in stock
Decrease/(increase) in debtors
Increase/(decrease) in creditors
**Net cash from/(used in) operating activities**|**2020**
**£**
158
5,037
(43,629)
19,819
(19,566)
**(38,181) **|**2019**
**£**
361
7,396
(68,211)
58,135
43,332|
|---|---|---|
|||**41,013**|
Page 19