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2023-03-31-accounts

Company number: 3450832 Registered Charity number: 1065963 (England & Wales)

TRUSTEES’ REPORT AND UNAUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2023

PAINTINGS IN HOSPITALS

TABLE OF CONTENTS

Page
Reference and administrative information 1
Trustees’ report 3
Independent examiner’s report 10
Statement of financial activities 11
Balance sheet 12
Notes to the financial statements 13

PAINTINGS IN HOSPITALS

REFERENCE AND ADMINISTRATIVE INFORMATION FOR THE YEAR ENDED 31 MARCH 2023

Royal Patron The former Prince of Wales
Patrons Lord Browne of Madingley
Rt Revd and Rt Hon The Lord Chartres
Dr Richard Cork
Andrew Hochauser KC
Roger Phillimore
Dame Stephanie Shirley CH DBE
The Rt Revd and Rt Hon Dame Sarah Mullally DBE, Bishop of London
Artist Patrons Ian Davenport
Sir Antony Gormley OBE
Maggi Hambling CBE
Bridget Riley CH CBE
Trustees Andrew Hochhauser KC – Chair (resigned 31 January 2023)
Prof Jane Anderson CBE (appointed 7 December 2022 - Chair from 1
February 2023)
Stephen Crampton-Hayward – Treasurer and Vice Chair
Prof Mary E Black
David Cleaton-Roberts (resigned 26 October 2022)
Jeanette Grose
Prof Marion Lynch
Robert Milburn
Krishna Omkar
Farha Quadri
Tim Reeve (resigned 26 October 2022)
Company number 3450832
Charity number 1065963 (England and Wales)
Registered office North House
198 High Street
Tonbridge
Kent
TN9 1BE
Executive Director Sandra Bruce-Gordon FRSA
Business address Unit 11, Earlsfield Business Centre
9 Lydden Road
London
SW18 4LT

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PAINTINGS IN HOSPITALS

REFERENCE AND ADMINISTRATIVE INFORMATION FOR THE YEAR ENDED 31 MARCH 2023

Independent examiner Samantha Wells FCA CTA
Lindeyer Francis Ferguson Limited
Chartered Accountants
North House, 198 High Street
Tonbridge
Kent
TN9 1BE
Principal Bankers HSBC plc
London Bridge Branch
28 Borough High Street
London
SE1 1YB
Legal Advisors
 GQ Littler
21 Ironmonger Lane
London
EC2V 8EY
J P C Law
Omni House,
252 Belsize Road,
London
NW6 4BT

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PAINTINGS IN HOSPITALS

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

The trustees (who are also directors of the company for the purposes of the Companies Act) present their report and the financial statements of Paintings in Hospitals for the year ended 31 March 2023. The Reference and Administrative information on page 1 forms part of this report.

The trustees confirm that the report and financial statements of the charity comply with the current statutory requirements, the requirements of the company's governing document, and the provisions of "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)).

Objectives and Activities

The objects of the Charity are to use art and creative activities to improve the health, well-being and quality of life of persons suffering from addiction, illness, injury, disorder, or disability, including (without limitation) any disability or disorder on the autistic spectrum in any location or establishment where any such person is resident or in attendance or where any such person is in receipt of treatment, therapy, convalescence, training, education, or assistance.

The charity’s three-year business plan has the following objectives:

  1. To support the design and implementation of high-quality arts interventions.

  2. To work toward the development of public awareness of the benefits for health through engaging with the arts.

  3. To identify and remove barriers to accessing the arts, including among older adults, people with mental ill health, people of lower socioeconomic status, members of ethnic or other minorities, people with a health condition or disability and people living in geographically isolated areas.

  4. To facilitate the development of partnerships and partner working between the health, social care, and arts sectors.

  5. To develop training, resources and guidelines that support collaboration between the arts and health sectors.

  6. To incorporate evidence on the health benefits of the arts into relevant policy documents.

In setting Paintings in Hospitals’ objectives and planning its activities, the trustees have given careful consideration to the Charity Commission’s general guidance on public benefit as required in section 17 of the Charities Act 2011 and, in particular, its supplementary public benefit guidance on fee charging.

The work of Paintings in Hospitals is recognised by the Department of Health and Social Care, the Care Quality Commission (CQC), NHS England and NHS Wales. Paintings in Hospitals is the Health Partner of the Arts Council Collection and works with a number of national galleries and museums. The charity’s approach is based on a range of research and evidence, demonstrating the positive effects of displaying and creating visual arts in a wide range of health and social care settings.

Our charitable objects are primarily achieved through our art loans programme, which exists to help create person-centred care spaces that encourage, enrich and empower everyone who uses them. Over 60 years of experience has allowed us to develop a unique collection of over 3,000 artworks. Our art ranges from paintings and drawings to sculptures and animations, some by the world’s greatest artists. All types of health and social care sites can borrow art from our collection.

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

To enable care sites and their service users to get the most from our artworks, we offer creative activities that provide the knowledge and confidence to engage with visual art. These activities often involve service users choosing the artworks they want for display, giving them a say in their own care experiences and improving levels of wellbeing.

We measure our success through the numbers of care partners we have; where we are working; who we are working with and the number of engagements with patients and staff we have.

This in turn feeds into our Theory of Change and Impact Development Plan agreed with Nesta in August 2022. We measure Business Plan performance through financial and non-financial objectives these include:

Structure, Governance and Management

Paintings in Hospitals was established by Trust Deed in 1959 and registered with the Charity Commission in May 1972. Our organisation is a charitable company, limited by guarantee and operates in accordance with its articles of association adopted on 24 April 2019. The strategy and policies of the charity are agreed by the Board of Trustees and its operations are managed by the charity’s Executive Director.

Trustees

The Charity was Chaired by Andrew Hochhauser KC who stood down and resigned at the end of January 2023. The Board of Trustees embarked on a full recruitment process to identify his successor and Professor Jane Anderson CBE was appointed in December 2022 and commenced the Chair role on 1 February 2023. Stephen Crampton-Hayward is Vice Chair and Treasurer. There are currently eight Trustees. Two Trustees, David Cleaton-Roberts and Tim Reeve, resigned in October 2022.

There are three committees; Finance and General Purposes, Strategic Engagement and Equality, Diversity and Inclusion. Each is Chaired by a nominated trustee and has a mix of skills, and its own Terms of Reference which are reviewed annually and signed-off by the Board. Oversight of fundraising activity is led by our Trustee Jeanette Grose who works with the Executive Director and the charity’s Fundraiser. Quarterly fundraising reports are tabled at Board meetings.

Risk Management and Fraud

The trustees have a regularly updated Risk Register and risk management processes which comprise:

This risk management work has identified a relatively small number of key risks, but ongoing review has resulted in improvements through the implementation of management and mitigation procedures and

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

increased contingency planning. Both financial and non-financial risks are included in the register. The risk register was last reviewed by the Board in September 2023.

The three most significant risks identified are as follows:

  1. Failure to achieve the financial performance levels set out in the Business Plan, which could put at risk the future viability of the charity. To mitigate against this risk the trustees review performance on a quarterly basis and are actively seeking to diversify the charity’s sources of income. The charity also has a significant asset base (in the form of the collection) which could be applied in support of its viability if necessary. Recent work on the collection has identified that some artworks have never been out on loan to partners and the subject matter is not suitable in a health and wellbeing setting. We have now identified a ‘working collection’, those artworks that underpin our charitable objectives. The remainder of the artworks have been identified as potential sale items and several have been sold subsequently.

  2. The loss of key members of staff which would cause dislocation to the charity’s operations in the short and medium term while suitable replacements were found. The charity has recently carried out a restructure of its workforce with a view to improving morale and motivation and is in the process of recruiting a number of new or enhanced roles.

  3. The inherent risk of working within the NHS environment at the current time given the strains on the sector from the coronavirus pandemic, budget constraints and resourcing and the current general economic environment. Given its objectives, the charity tolerates this risk but seeks to monitor the situation and respond appropriately to any changes, both adverse and favourable.

Achievements and Performance

We partnered with social enterprise Better and collaborated on the Art Meets Book project, designed to bring art exhibitions and workshops to communities in London and the West Midlands via local libraries. The project was supported using public funding by the National Lottery through Arts Council England. By bringing art into the heart of these communities, the Art Meets Book project was designed to improve the health and wellbeing of local people adversely affected by the Covid-19 pandemic. Art Meets Book aims to increase equity of access to art and to use art therapeutically to maximise wellbeing, provide new experiences, and stimulate open discussions. The project successfully engaged 49 participants most of whom were from diverse ethnic backgrounds. Many had not previously visited an art gallery or museum, an experience shared by people from disadvantaged socio-economic backgrounds. The project also met participants’ need for social connections and friendships and contributed to relieving isolation. Siting the project in libraries facilitated engagement for the targeted groups, as these were seen as safe and accessible places. The project also engaged with 23 primary school children. A co-production approach from the Painting in Hospitals’s project leads and storyteller was essential in making the children feel supported and valued, as was the public display in the library at the end of the project of their artworks and feedback.

The OASIS project was created to ease social isolation and loneliness at home by connecting participants with new art, creative activities, and communities of like-minded people. Beginning in early 2022, the OASIS project aimed to place meaningful artworks, specially produced by artists for individuals, directly into people’s homes and to enable eligible participants to make new social connections through a range of guided conversations and group activities. Initially launched in the Guildford and Waverley area,

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

OASIS is a way for people battling with social isolation and loneliness to get together to explore new creative and cultural experiences, while lending a supportive ear or offering advice to others experiencing similar struggles. The OASIS pilot project also aimed to enrich the lives of people with lifelimiting conditions through art and creative engagement, in a unique partnership between Paintings in Hospitals and Sue Ryder. It involved pairing befriending volunteers with remote day patients. Participants reported that the sessions had improved their mood & feelings at the time. Participants were facing some existential issues potentially affecting them deeply emotionally. Engagement in the process gave them some space to take their minds off this, and although this was temporary, it provided a welcome relief: ‘Doing something different, gave me a chance to concentrate and try something new. Time flew by and conversation flowed easily whilst we were working.’

Our I’m Fine Project designed to improve nurses’ mental health and wellbeing through images, online learning, and a comprehensive learning resource publication completed in 2022 with our Trustee Marion Lynch who led the project and our Executive Director invited to present the outcomes from the project to the International Congress of Nurses in Montreal in July 2023.

In January 2023 the charity published the book ‘Lifting the Clouds’ this marked the work of the outgoing Chair Andrew Hochhauser KC and showcased works from the collection together with statements of the impact to individuals from our work. Compiled by our Executive Director and with a Foreword by our Patron Dr Richard Cork, art historian and art critic, it is now being widely used to recruit new friends and supporters.

We also commissioned a short film ‘Power of a Painting’ again showcasing the charity’s work and in particular our new engagement activities. The film features participants from our projects and there are contributions from artists Anita Klein and Sue Arrowsmith. The film was shortlisted for the ‘Best Charity Film – Small’ category at the 2023 Third Sector Awards.

Our Collection

At the end of March 2023, there were 3,679 artworks in our Collection. Of these, some 1,500 were at the Earlsfield Business Centre or in external storage, many of which require funds for reframing and conservation. At the end of March 2023, there were 1,631 artworks on public display at either our showcase displays or our loan partner sites (2022: 2,195 artworks).

Project Felicitous continues aiming to address the effectiveness of the collection, making it fit for purpose in a new modern post pandemic era. Where we have found that an artwork has not been placed with a care partner or is unlikely to be so because it is for whatever reason unsuitable, we have begun to sell the works to assist the charity’s financial resilience. Sotheby’s and Bonhams have provided strong advice as to placing work and its possible value. In total, 23 further artworks were deaccessioned in the year to 31 March 2023 and 77 further artworks have been deaccessioned since 1 April 2023.

Communications and public engagement

As the team now has additional capacity in marcomms with a digital marketing and communications assistant who commenced in June 2023, we have increased our social media output as well as our online web content and PR. As a result, our social media following is now 3,900 followers on Instagram, 4,800 followers on Facebook and 12,600 followers on X (formerly Twitter.)

Fundraising

In 2023 we became a charity partner of eBay, and our shop went live. Our merchandise includes prints that were given to the charity for sale, and these include works by Chloe Cheese, Peter Blake, John

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TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

Hoyland and Norman Ackroyd. Some of our deaccessioned artwork is also featured and we will be developing or merchandise range to include cards. We are delighted to have received permissions to use artwork from our collection by the artists.

In support of Paintings in Hospitals, much-loved and revered artist Anita Klein has created a specially designed artwork, a limited edition of 30 prints which show ‘Women on the Beach’ a beautiful story and a reflection upon those special moments in life that make memories. All proceeds from the sale will be given to the charity. Anita Klein exhibits her paintings and prints regularly with Eames Fine Art London and has her work in public collections including the British Museum, Victoria and Albert Museum and Arts Council England.

Financial Results

Paintings in Hospitals ended the year with a deficit of £38,643 (2022 15 months: surplus of £187,584).

Income for the year was £363,138 (2022 15 months: £593,854). This includes £40,400 (2022: £262,500) of income recognised as a result reclassifying certain previously donated artworks, which were not valued in the accounts, as current asset investments. Subsequent to this, seven artworks were sold at auction raising £85,500 in total and it is the Trustees intention that further such sales will take place over future years. The charity also benefited from a tax credit of £42,509 (2022: £25,478) under the Museums and Galleries Exhibition Tax Relief provisions.

As described above, the charity has embarked on a programme to deaccession and, in most cases sell, a number of artworks which have not been and are highly unlikely to be displayed in hospitals and other care settings. This includes selling all our sculptures as these cannot be displayed safely and costeffectively, and in November 2023 we sold at auction a sculpture by Dame Elisabeth Frink for £170,000. The sculpture was carried in our balance sheet at 31 March 2023 at £120,000 and the profit on sale of £50,000 will be included in the accounts for the year to 31 March 2024. We are grateful to our Patron Dame Stephanie Shirley who gifted the sculpture to us in 2012 and to Prior’s Court School, Thatcham, Berkshire in whose care it has been since then. The funds raised from this and the sale of other artworks will help ensure the sustainability of the charity for the foreseeable future.

Investment Policy

The trustees invested funds that are surplus to the immediate needs of the charity in investments that generate reasonable rates of return whilst minimising the risk of loss. Investment gains and losses are taken through the Statement of Financial Activities to unrestricted reserves. At 31 March 2023, our investments had a market value of £57,238 (2022: £63,092).

We are proud that the charity uses ethical investment vehicles. For any future changes to our investments, such as moving to a new service, the charity would assess the social, environmental, and ethical considerations of the investing organisation as well as the likely returns.

Reserves

The aim of the trustees is to maintain a level of free, unrestricted reserves of or around six months average annual expenditure that will enable Paintings in Hospitals to operate from a financial perspective with certainty and flexibility. At 31 March 2023 free unrestricted reserves (unrestricted funds less fixed assets) decreased to a surplus of £225,195 (2022: surplus of £258,841). The charity’s cash position decreased by 68% to £43,160 (2022: £136,541).

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PAINTINGS IN HOSPITALS

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

Business Plan

Our three-year business plan authored in 2020 and agreed by the Board of Trustees in December of that year set out clearly the challenges facing the charity; the biggest of those was accepted as being a lack of funding and therefore poor financial resilience and sustainability with the knock-on effect that the charity did not have the capacity to deliver on opportunities and turn weaknesses into strengths. Written at the time of the first lock down the charity considered the severe health, social, economic and political consequences of the pandemic which highlighted flaws in systems and thinking, and the strengths in our communities and creativity. The business plan also took into consideration the need to maintain relevance and to emerge stronger and more fit for purpose. In reviewing the progress of the plan in years one and two we recognise like all good plans, ours has changed and developed and sometimes the objectives have been delivered in different ways as we reacted or were proactive to changes in situations internal and external. We have made significant progress toward delivery of our new objectives combined with a robust evaluation of projects, we are now in an excellent position to realign the charity to continue to deliver impact from visual art on health and wellbeing. As we approach our 65[th] Anniversary in 2024 there is a renewed sense of purpose as we use our learning from the last three years to drive the charity forward.

Patronage

We are particularly grateful to the unwavering support and guidance of all our Patrons. Our Patrons help us raise awareness, expand our national reach and advocate for all that we do. Our thanks go to Edmund de Waal CBE who stood down as an Artist Patron during the year, and we were pleased to welcome our out-going Chair, Andrew Hochhauser, as a Patron from February 2023.

Our Thanks

We are extremely pleased to have received grants and donations from a number of individuals, trusts and foundations during the year. It is through the continued support of these generous people, donors and funders that we are able to benefit those most in need, through our work.

We are very grateful again to the entire staff team for their devotion and hard work throughout 2022/23. We are also grateful to many of the health and social care partners that benefit directly from our programmes, and who, through evaluation and feedback, help us to refine and improve them.

Statement of Trustees’ responsibilities

This Trustees’ report has been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102) and in accordance with the special provisions for small companies under Part 15 of the Companies Act 2006.

The trustees (who are also the Directors of Paintings in Hospitals for the purposes of company law) are responsible for preparing a Trustees’ annual report and accounts in accordance with applicable law and regulations and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).

Company law requires the trustees to prepare financial statements for each financial year. Under that 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 charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

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PAINTINGS IN HOSPITALS

TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2023

The trustees are responsible for keeping accounting records that are sufficient to show and explain the charitable company’s transactions and disclose with reasonable accuracy at any one time the financial position of the charity and enable them to ensure that the accounts comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence taking reasonable steps for the prevention and detection of fraud and other irregularities. The trustees are also responsible for the maintenance and integrity of financial information, including that on the updated website.

This report was approved by the trustees on 13 December 2023 and signed on their behalf by:

Prof Jane Anderson CBE Chair

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PAINTINGS IN HOSPITALS

INDEPENDENT EXAMINERS’ REPORT TO THE TRUSTEES OF PAINTINGS IN HOSPITALS FOR THE YEAR ENDED 31 MARCH 2023

I report to the charity trustees on my examination of the accounts of the charitable company for the year ended 31 March 2023.

Responsibilities and basis of report

As the trustees of the charitable company (and its directors for the purposes of company law) you are responsible for the preparation of the accounts in accordance with the requirements of the Companies Act 2006 (‘the 2006 Act’).

Having satisfied myself that the accounts of the charitable company are not required to be audited under Part 16 of the 2006 Act and are eligible for independent examination, I report in respect of my examination of the company’s accounts carried out under section 145 of the Charities Act 2011 (‘the 2011 Act’). In carrying out my examination I have followed the Directions given by the Charity Commission under section 145(5)(b) of the 2011 Act.

Independent examiner's statement

Since the charitable company’s gross income exceeded £250,000 your examiner must be a member of a body listed in section 145 of the 2011 Act. I confirm that I am qualified to undertake the examination because I am a member of the Institute of Chartered Accountants in England and Wales, which is one of the listed bodies.

I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe:

I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached.

Samantha Wells FCA CTA Lindeyer Francis Ferguson Limited Chartered Accountants North House 198 High Street Tonbridge Kent TN9 1BE

Dated: 18 December 2023

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

STATEMENT OF FINANCIAL ACTIVITIES (incorporating income and expenditure account) FOR THE YEAR ENDED 31 MARCH 2023

Notes
Income from:
Donations, grants and legacies
2
Charitable activities
3
Other trading activities
4
Investments
Total income
Expenditure on:
Raising funds
5
Charitable activities
6
Total expenditure
Net (expenditure)/income before tax
10
Corporation tax credit
17
Net losses on investments
12
Net movement in funds
Reconciliation of funds:
Total funds brought forward:
Total funds carried forward
17		 Restricted
Unrestricted
funds
funds
Year ended
31 March
Year ended
31 March
2023
2023
£
£
53,986
202,909
-
103,304
-
-
-
2,939
53,986
309,152
-
39,772
59,625
339,039
59,625
378,811
( 5,639)
( 69,659)
-
42,509
-
( 5,854)
( 5,639)
( 33,004)
28,236
260,158
22,597
227,154		 Total
funds
Year ended
31 March
2023
£
256,895
103,304
-
2,939
363,138
39,772
398,664
438,436
( 75,298)
42,509
( 5,854)
( 38,643)
288,394
249,751		 Total
funds
Period ended
31 March
2022
£
424,331
142,391
24,888
2,244
593,854
24,671
401,694
426,365
167,489
25,478
( 5,383)
187,584
100,810
288,394

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

BALANCE SHEET AS AT 31 MARCH 2023

Notes
Fixed assets
Tangible assets
11
Investments
12
Current assets
Current asset investments
13
Debtors
14
Cash at bank and in hand
Creditors: amounts falling due
within one year
15
Total assets less current liabilities
Creditors: amounts falling due in more
than one year
16
Net assets
Charity funds
Unrestricted funds
17
Restricted funds
17
Total funds		 £
222,200
134,167
43,160
399,527
( 137,688)		 2023
£
1,959
57,238
59,197
261,839
( 71,285)
249,751
227,154
22,597
249,751		 £
234,500
79,749
136,541
450,790
( 125,041)		 2022
£
1,317
63,092
64,409
325,749
( 101,764)
288,394
260,158
28,236
288,394

For the financial year ended 31 March 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

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

The financial statements have been prepared in accordance with the provisions applicable to small companies within Part 15 of the Companies Act 2006.

The financial statements were approved by the Board of Trustees on 13 December 2023 and signed on their behalf by:

…........................... …........................... Prof Jane Anderson CBE Stephen Crampton-Hayward Chair Treasurer Company registration number: 3450832

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

1 Accounting policies

The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

1.1 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.

Paintings in Hospitals 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 note(s).

The financial statements are presented in pounds sterling and rounded to the nearest pound.

In preparing the financial statements the trustees have prepared an in-depth analysis of cashflow. This forecasts income and expenditure on a monthly basis. As such it shows that the charity is financially secure in the short to medium term. In addition the Trustees have agreed the sale of artworks which have never been used for the charitable purposes and which are assessed as unlikely to do so; this has become a significant income stream for the charity. The financial targets within the Business Plan for year 2 have been met and the core activity of loaning work for exhibition continues to be steady with new enquiries coming in. We therefore have continued to adopt the going concern basis of accounting.

The comparative amounts in the financial statements are for the 15 month period to the 31st March 2022.

1.2 Company status

Paintings in Hospitals is a charitable company limited by guarantee incorporated in England and Wales. The address of the registered office is North House, 198 High Street, Tonbridge, Kent, TN9 1BE. In the event of the company being wound up, the liability in respect of the guarantee is limited to £1 per member of the company.

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

1.3 Income

Income from donations, grants and legacies is recognised when the charity has entitlement to the income, it is probable it will be received and the amount can be measured reliably. For donations this is usually on receipt. For grants, this is usually when a formal offer is made in writing, unless the grant contains terms and conditions which must be met before the charity is entitled to the funds. Legacies are recognised following the grant of probate when the executor of the estate has communicated in writing both the amount and settlement date. Donated services are recognised in the period in which they are utilised and are measured at their estimated fair value.

Income from loan programmes is apportioned over the period of the rental agreements. Income received in advance is accounted for as deferred income.

Donated paintings are included in incoming and outgoing resources at an estimate of their value.

Income from other trading activities relates to fundraising, Patrons Circle art print sales and gift shop sales. Fundraising income and art print sales are accounted for in the period in which the charity is entitled to receipt.

Investment income is recognised when it is receivable.

1.4 Expenditure

Expenditure is recognised on an accruals basis as incurred. Expenditure has been classified under headings that aggregate all costs related to the category.

Direct costs are those costs which are directly attributable to the charity's activities. Wages and salaries are allocated to direct costs based on the estimate of time spent on charitable activities by staff members.

Support costs are those costs relating to functions which assist the work of the charity but do not directly relate to its activity. Support costs are allocated to charitable activities on the basis of direct costs.

1.5 Tangible fixed assets and depreciation

Tangible fixed assets are stated at cost less depreciation. Depreciation is charged so as to write off the cost less their residual values over their expected useful lives at the following annual rates:

Furniture and fittings - 25% Straight line
Computer expenditure - 33% Straight line

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

1.6 Current asset investments

Current asset investments comprise artworks held for sale and are carried at their estimated realisable value, based on historical experience of the sales prices achieved on previous sales relative to the insurance valuations of those artworks.

1.7 Financial Instruments

The charity only has financial instruments which are classified as basic financial instruments. Short-term debtors and creditors are measured at the settlement value. Any losses from impairment are recognised in the Statement of Financial Activities.

1.8 Fund accounting

The unrestricted funds can be spent on any activity within the charity’s overall objectives. Restricted funds are those subject to specific conditions imposed by the donors. Expenditure which meets these criteria is allocated to the fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

1.9 Operating leases

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

1.10 Pension contributions

The charity makes defined contributions into employee private pension schemes. Contributions are charged to the statement of financial activities as they become payable.

2
Income from donations, grants and legacies
Donations and grants
Previously donated artworks
Donated services		 2023
£
165,015
73,200
18,680
256,895		 2022
£
150,866
262,500
10,965
424,331

Previously donated artworks valued at £40,400 have been recognised during the year as a result of having been identified as available for sale and no longer part of the charity’s collection. During the year seven of the artworks were sold at auction at a profit of £32,800, leaving £222,200 carried as current asset investments at the year end (note 13).

Donated services relate to the provision of IT software and consultancy services.

Income for restricted funds in the comparative period was £39,400.

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PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

3
Income from charitable activities
Loan programme
Gift shop sales
4
Other trading activities
Fundraising events and Patrons Circle
5
Expenditure on raising funds
Costs of events
Donations and grants
Support costs_(Note 8)_		 2023
£
98,319
4,985
103,304
2023
£
-
-
2023
£
14,803
16,278
8,691
39,772		 2022
£
129,186
13,205
142,391
2022
£
24,888
24,888
2022
£
7,337
9,251
8,083
24,671

Costs of events, donations and grants includes staff costs of £27,862 (2022: £12,596).

6 Expenditure on charitable activities

Projects and programmes
Loan programme
Trading expenses		 Direct
costs
2023
£
34,544
281,764
4,136
320,444
(Note 7)		 Support
Costs
2023
£
8,691
65,183
4,346
78,220
(Note 8)		 Total
costs
2023
£
43,235
346,947
8,482
398,664		 Total
costs
2022
£
21,793
371,329
8,572
401,694

Expenditure on restricted funds in the comparative period was £11,164.

16

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

7
Direct costs
Staff costs
Freelance and consultancy costs
Volunteer expenses
Collection management
Picture transport
Cost of projects
Premises expenses
Office costs
Travel and accommodation
Marketing and IT
Other costs
Depreciation
8
Support costs
Staff costs
Volunteer expenses
Premises expenses
Office costs
Travel and accommodation
Other costs
Loan Interest
Depreciation
Bad debts
Accountancy and consultancy fees
Governance costs:
Legal and professional fees
Independent examination fees
Allocated to:
Raising funds
Charitable activities		 Total
2023
£
101,251
97,460
-
6,098
12,362
16,757
49,340
7,253
5,813
20,128
3,440
542
320,444
Total
2023
£
38,697
-
3,046
840
4,086
8,513
9,200
542
2,952
13,573
149
5,313
86,911
8,691
78,220		 Total
2022
£
170,045
55,128
21
13,891
18,021
-
62,748
2,774
1,848
30,092
984
344
355,896
Total
2022
£
27,291
1
3,303
173
109
3,939
3,726
344
5,770
4,681
799
3,745
53,881
8,083
45,798

17

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

9 Staff costs

Wages and salaries
Social security costs
Pension costs
Loan Programmes
Administrative
The average monthly number of employees during the year was as follows :		 2023
£
156,824
9,390
1,596
167,810
2023
No.
1
4
5		 2022
£
196,220
11,335
2,377
209,932
2022
No.
3
3
6

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

No remuneration, other benefits or reimbursed expenses were paid to the Trustees for the year ended 31 March 2023 (2022: none).

10 Net expenditure

Net expenditure
2023 2022
£ £
This is stated after charging:
Independent examiner's remuneration 2,350 2,245
Independent examiner's remuneration for accountancy services 2,963 1,500
Depreciation 1,083 687

18

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

11
Tangible fixed assets
Furniture
£
Cost
At 1 April 2022
1,925
Additions in the year
1,250
At 31 March 2023
3,175
Depreciation
At 1 April 2022
1,925
Charge for the year
313
At 31 March 2023
2,238
Net book value
At 31 March 2023
937
At 31 March 2022
-
12
Investments
Market Value
At 1 April 2022
Disposals
Net losses on revaluation
At 31 March 2023
Investments are held in UK deposit funds or fixed interest bond funds.
13
Current asset investments
Artworks held for sale		 Equipment
£
1,837
475
2,312
520
770
1,290
1,022
1,317
2023
£
63,092
-
( 5,854)
57,238
2023
£
222,200		 Total
£
3,762
1,725
5,487
2,445
1,083
3,528
1,959
1,317
2022
£
107,924
( 39,449)
( 5,383)
63,092
2022
£
234,500

19

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

14 Debtors

Trade debtors
Prepayments and accrued income
Other debtors
Creditors: amounts falling due within one year
Rentals of paintings in advance
Nesta Cultural Impact Development loan
Accruals and other creditors
Taxation and social security		 2023
£
66,575
17,471
50,121		 2022
£
41,788
6,633
31,328
134,167
2023
£
80,422
30,326
22,819
4,121
137,688		 79,749
2022
£
82,197
25,736
14,291
2,817
125,041

15 Creditors: amounts falling due within one year

Deferred income relates to income for loan programmes received in advance. The movement is as follows:

Deferred income brought forward
Released during the year
Arising in the current year
Deferred income carried forward
Creditors: amounts falling due after one year
Nesta Cultural Impact Development loan		 2023
£
82,197
( 82,197)
80,422
80,422
2023
£
71,285		 2022
£
95,408
( 95,408)
82,197
82,197
2022
£
101,764

16 Creditors: amounts falling due after one year

The loan bears interest of 7.8% and is for a term of 5 years, with repayments having commenced in May 2022. The loan is unsecured.

20

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

17 Statement of funds

Statement of funds
Current year
Unrestricted funds
General fund
Restricted funds
Burdett Trust
OASIS Project
South Wales Care Homes
Art Meets Book
Jerwood Foundation
Total restricted funds
Total funds		 Brought
forward
£
260,158
11,612
7,224
9,400
-
-
28,236
288,394		 Income
£
309,152
-
-
-
43,986
10,000
53,986
363,138		 Expenditure
£
( 378,811)
( 8,415)
( 7,224)
-
( 43,986)
-
( 59,625)
( 438,436)		 Other
gains/
(losses)
£
36,655
-
-
-
-
-
-
36,655		 Carried
forward
£
227,154
3,197
-
9,400
-
10,000
22,597
249,751

Other gains and losses above relates to a claim for a tax credit for the Museums and Galleries, Exhibition Tax Relief of £42,509 for the year ended 31 March 2023 and a loss on the revaluation of investments of £5,854.

Funding was received for the Burdett Trust Project which is to improve nurses mental health and wellbeing through online learning. £8,415 has been expensed in the year.

The OASIS Project is to help enrich the lives of socially isolated individuals through art and creative engagement. This Project was completed in the period, with all funds fully expended in the year.

The South Wales Care Home Project plans over the course of a year to provide long term artwork loans and associated activities to three care home or community settings across South Wales. Do to a resurgence of Covid-19 in the latter half of 2021 the project was postponed and was delivered in the Summer of 2023. As the project had not commenced by the end of the financial year the funds have been carried forward.

The Art Meets Book Project is to increase access to art and use visual art and art engagement to help adversely affected groups. Sessions were held in three libraries to explore the charities art collection verbally and visually. This project was completed in January 2023.

The Jerwood Foundation awarded a grant of £10,000 each year for two years to conserve and frame artwork within the charity's collection. Significant artworks will be selected with prioritisation being on works that can be placed immediately within partner sites. No artworks were conserved or framed in the financial year 2022/23.

21

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

17 Statement of funds (continued)

Statement of funds (continued)
Prior year
Unrestricted funds
General fund
Restricted funds
Burdett Trust
OASIS Project
South Wales Care Homes
Total restricted funds
Total funds		 Brought
forward
£
100,810
-
-
-
-
100,810		 Income
£
554,454
20,000
10,000
9,400
39,400
593,854		 Expenditure
£
( 415,201)
( 8,388)
( 2,776)
-
( 11,164)
( 426,365)		 Other
gains/
(losses)
£
20,095
-
-
-
-
20,095		 Carried
forward
£
260,158
11,612
7,224
9,400
28,236
288,394

Other gains and losses above relates to a claim for a tax credit for the Museums and Galleries, Exhibition Tax Relief of £25,478 for the year ended 31 December 2020 and a loss on the revaluation of investments of £5,383.

18 Analysis of net assets between funds

Fixed assets
Current assets
Liabilities		 Restricted
funds
2023
£
-
22,597
-
22,597		 2023
£
59,197
376,930
( 208,973)
227,154
Unrestricted
funds		 Total funds
2023
£
59,197
399,527
( 208,973)
249,751		 Total funds
2022
£
64,409
450,790
( 226,805)
288,394

Total funds for 2022 included restricted funds of £28,236.

22

PAINTINGS IN HOSPITALS (A company limited by guarantee)

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

19 Paintings

The charity’s loan collection is not reflected in these accounts as, in the opinion of the Trustees, it is neither practical nor beneficial to reflect the true value of the collection. At 31 March 2023 the total collection, which includes lent, purchased and donated artworks, comprised 3,679 works of art, which have been insured on a first loss basis for £3.5 million. Movements on the number of artworks and insured values over the past 5 years are as follows:

31 March 31 December
2023 2022 2020 2019 2018
Number of artworks 3,679 3,691 3,730 3,857 3,844
Insured value £3.5m £3.6m £3.8m £4.0m £3.8m

20 Related party transactions

The charity's key management personnel are the trustees, the Executive Director and the Head of Collection, Loans & Programming. Total employee benefits, including employer's pension contributions and employer's National Insurance, in respect of key management personnel were £62,427 (2022: £59,085). No employee benefits are payable to the trustees.

One trustee was paid £3,000 for Freelance work as lead on a Project (2022: One trustee paid £7,000) and £1,831 for travel expenses (2022: £Nil)

There are no further related party transactions to disclose.

23