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2022-08-31-accounts

REGISTERED COMPANY NUMBER: 03760619 (England and Wales) REGISTERED CHARITY NUMBER: 1078360

REPORT OF THE TRUSTEES AND CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 AUGUST 2022

FOR

CITY GATEWAY

Imagine a society where everyone reaches their full potential. Where the future is not defined by the past or determined by the place a person starts.

City Gateway Contents of the financial statements for the year ended 31 August 2022

Page
Report of the Trustees 1 to 6
Report of the Independent Auditor 7 to 9
Consolidated Statement of Financial Activities 10
Consolidated Balance Sheet 11
Balance Sheet 12
Consolidated Statement of Cash Flows 13
Notes to the Financial Statements 14 to 25

City Gateway Contents of the financial statements for the year ended 31 August 2022

The Trustees, who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31 August 2022.

The Trustees have adopted the provisions of the Statement of Recommended Practice (SORP) 'Accounting and Reporting by Charities' 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).

Registered Company number 03760619 (England and Wales)

Registered Charity number 1078360

Registered Office The Pavilion Import Building, 2 Clove Crescent, London, E14 2BE

TRUSTEES

Kenny Imafidon - Chairman Sean Greathead (resigned 26 January 2022) Kate Vintiner Yvonne Bajela Uchechi Okereke Clive Mills Adam Pizzey David Wesson

CHIEF EXECUTIVE

Diane Betts

AUDITOR

Mazars LLP, 6 Sutton Plaza, Sutton Court Road, Sutton SM1 4FS

BANK

National Westminster Bank, PO Box 282, 216 Bishopsgate, London, EC2M 4QB

City Gateway Trustees Report for the year ended 31 August 2022

WHY WE DO WHAT WE DO?

Right now, things seem rather desperate with the cost-of-living crisis, sky-high energy prices and inflation at the highest level for a generation. The young people we support are struggling to afford food, they are regularly having to turn to foodbanks to feed themselves, and they live with the worry of how to pay to heat their homes every day. It sounds bleak, but for some it has been even worse. One such learner is Michaela. A few years ago she wasn’t in a great place, her mum had died, her mental health was suffering and she had no confidence in herself. She dropped out of sixth form because the teachers didn’t support her, and she had lost all her motivation. At the time she thought she had no future and she didn’t know where to turn. But, there was, there is, thanks to City Gateway.

Michaela says “Thanks to City Gateway I can say with so much pride that I’m an apprentice! They helped me develop skills to make me employable – I never had a CV and had no clue where to start with a covering letter – and they helped me secure my apprenticeship. They took me from a place where I didn’t feel I had a shred of self-confidence to where I am now, brimming with confidence. I have to thank the coaching team for that. I’d never felt I could talk about what had happened and how I felt. But they listened. They actually cared. Not just about my future but about me, even supporting me with travel costs and there was always breakfast available to start the day right. I love their foodbank, I still use that today. I have been given so many new opportunities, and I go home every day with a new sense of fulfilment.”

Michaela is one of 232 young people we have supported during 2021-22. And Michaela’s story is not an isolated one. We have supported young people who have been homeless, those who have struggled with drug and alcohol use, those who are deeply in debt as well as those who are raising young children on their own. City Gateway has given them a safe space to come and achieve their ambitions. We never judge. We always listen and we treat each young person as an individual. Our wrap around coaching support helps them to remain focussed on their learning while they continue to navigate the challenges they still face in other areas of their lives. We stay with them, continuing our support, never giving up on their potential to achieve.

WHAT WE DO

City Gateway is a charity formed in 1999 by a group of City professionals who were concerned about unemployment in their local community.

We believe in empowering people to change their own future.

And by standing with them and supporting them to achieve those ambitions, that future can be as optimistic as they dare imagine. In Tower Hamlets today, over half of all children will wake up in poverty. Many families don’t know where to turn and job opportunities for young people can be hard to access.

Possibilities are on the doorstep – literally. The affluence of Canary Wharf sits side by side with Tower Hamlets in East London, where we’re based. Yet without help unlocking that potential, few will benefit.

This is where we step in, seeing potential – even well-hidden potential – working in some of London’s communities most impacted by social and economic inequality. Our motivation and deeply held conviction is that by standing with people, providing practical input as they navigate sometimes huge obstacles, enables them to rewrite their story.

We provide support services, training courses, Traineeships and Apprenticeships for young people, readying them for the workplace. Through our network of placements with world-leading employers, we provide opportunities that give young people vital experience, much needed confidence, and essential skills.

Last year we supported 232 young people on our Traineeship programme. We had an overall achievement rate of 76%. Before coming to City Gateway 70% of our learners were not in any form of Education, Employment or Training and 94% were Target Population. Of all learners on a traineeship 25% of learners had learning difficulties or health problems and 12% were from low income families.

The charity continues to deliver education, training and coaching programmes for students and pathways into sustainable employment with our partner employers. We are a gateway for our students to achieve their full potential.

Page 1

City Gateway Trustees Report for the year ended 31 August 2022

ETHOS AND VALUES

At City Gateway, we believe everyone is made equal and in the image of God. We strive to follow the example of Jesus, in loving and helping those excluded and in need in society. We celebrate diversity. We treat everyone with respect and honesty. We are ambitious. We seek excellence in all we do. And we are optimistic for the future.

THE NEED

The capital’s youth unemployment rate currently stands at 13.5% which is more than three times higher than the UK national unemployment rate for all ages of 3.7% (Office for National Statistics).

The rate of unemployment in the capital of young people aged 16-24 is 29% higher than in the same age group across the rest of England, according to the Office for National Statistics.

Most worrying is that 21.7% of all people who had been unemployed for more than 12 months were 16-24 year olds (according to the Office for National Statistics), which has crushing consequences for their hopes and selfesteem.

What we do works. But the reality is, Covid-19 and the cost-of-living crisis is having a greater impact on young people. Their education has been impacted and affording to buy life’s necessities has become increasingly difficult. Which means there is greater demand for our courses. In the last year alone, we have seen a 46% increase in demand. Learners are coming to us with lower-level prior attainment in the core subjects of maths and/or English – one third are at the level of 7-11 year old children. And in core industries such as Information Technology, which is growing at an incredible rate, there aren’t enough people with the skills to feed the workforce of the future.

We are expertly equipped to meet all these challenges.

That is why we are going to support 400 young people in 2022-23 and 600 in 2023-24, because there is huge demand we must meet to ensure young people are never held back by disadvantage or the place they start.

HOW WE DO WHAT WE DO

Young people have been caught in a perfect storm. To get a sustainable job they need the right experience and skills. Work placements and apprenticeships provide this, but almost 80 per cent of entry-level apprenticeships and work placements were cut or paused due to Covid. As the job market opened up, there has been increased competition for entry level roles with two years’ worth of school leavers and graduates looking. Combined with older workers returning to the labour market, the impact is pushed further down the chain. This affects those most who have the least experience, however talented they may be.

OUR IMPACT

Our achievement rate last year was 76% despite the impact of Covid. Of those young people, 48% entered full time work (16+ hours) with 62 new employers. 26% of our young people progressed on to an apprenticeship with 31 new apprenticeship employers. 27% of our young people went on to Further Education or training with 34 of our referral partners.

Page 2

City Gateway Trustees Report for the year ended 31 August 2022

OUR PARTNERS

City Gateway’s impact is only possible in collaboration with the future-thinking, generous organisations who partner with us. These organisations work with us to volunteer, fund our programmes, and provide work placements and Apprenticeship opportunities in their teams for our aspirational, job-ready learners.

Each of our partners has made a significant contribution to changing lives in London in 2021-22 and we are truly grateful to all of them. We were also delighted that Impetus renewed their partnership with us into a sustain phase to support us to meet our growth targets of working with 600 young people from 2023-24.

Below are just some of the partners that make our work possible:

If you would like to partner with us, please contact partnership@citygateway.org.uk for more information.

Page 3

City Gateway Trustees Report for the year ended 31 August 2022

BOARD GOVERNANCE

City Gateway is a company limited by guarantee governed by its Memorandum and Articles of Association dated 13 April 2022. It is registered as a charity with the Charity Commission.

City Gateway has always and will continue to take its responsibilities of ensuring that its charitable activities contribute significantly to the lives of those we work with and specifically within the local areas in which those activities are undertaken. With reference to Charities Act 2011, all our charitable activities are directed towards having a lifelong impact on London and these activities are undertaken to further our charitable purposes for the public benefit.

Trustees are appointed on the basis of their skills and experience as well as their passion to further City Gateway's vision, mission and ethos. A mix of different skills and backgrounds is sought on the Board and for Board Working Groups.

All Trustees give their time voluntarily and receive no private benefit from the charity. The term of office for a Trustee is two terms of 3 years, extendable by invitation of the Chairman.

Newly appointed Trustees are briefed on their responsibilities and legal obligations under both charity and company law, the Memorandum and Articles of Association, the current Strategic Business Plan and given an overview of the recent financial performance. Each Trustee is given a particular role on a Board Working Group and is expected to attend all Trustee meetings. Trustees are encouraged to attend appropriate external training, where this facilitates the undertaking of their role.

Trustees are responsible for setting general policy, finalising and approving the annual plan and budget, monitoring the charity and taking major decisions about the strategic direction of the charity and capital expenditure. Trustees appoint the Chief Executive Officer ("CEO") to manage and lead the charity and agree a level of delegated authority. The CEO is accountable to the board of Trustees through the Chairman who has regular meetings with the CEO. The CEO is responsible for ensuring that the charity delivers its mission, and that key performance metrics of operational delivery are met. The remuneration of the CEO is approved annually by the Trustees.

TEAM

City Gateway has an outstanding staff team of 27 led by Diane Betts.

We invite employers to help us change society for the better by stepping up with job or apprenticeship opportunities for the upskilling young people and the future workforce.

We know there is an incredible pool of hidden talent. Whilst our coaching model achieves positive outcomes for those on our programme, young people need support. It is our joint responsibility to improve individual life chances and unlock potential.

All our team have a passion for our students and achieving lasting transformational impact in their lives. They are just as passionate for serving our partners with excellence and for our culture of continuous improvement.

Page 4

City Gateway Trustees Report for the year ended 31 August 2022

FUTURE IMPACT PLAN FOR THE COMING YEARS

The Trustees plan, in the future, to build on our mission and grow our impact to transform the life chances of Young People in London communities most impacted by social and economic inequality.

We continue to work with employers to place our students into Traineeship work placements leading to Apprenticeship outcomes to increase our financial sustainability.

We want to continue to improve progression into full time education or employment outcomes for all our students. We especially want to support our students into Apprenticeships, which uniquely allow us to continue to support, coach and train them whilst they complete their first 12/18 month's employment.

FINANCIAL REVIEW 2021/22

The accounts contained in this report are presented 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)) and with relevant companies and charities legislation and regulations.

The Trustees report a year of excellent progress in 2021/22 emerging from the pandemic.

City Gateway's gross income from all sources, how this income was expended and the split of financial activity between restricted and unrestricted funds is shown in detail in the following pages. Annual income was £1.7m (2020/21: £1.6m). Our annual surplus in the year was £29k (2020/21 surplus of £11k). This surplus is a direct result of continuing our investment in building expertise in the future strategic direction.

RESERVES

City Gateway is committed to using its resources in pursuit of its charitable activities. It is also committed to maintaining a level of reserves that is prudent to meet its on-going liabilities, sufficient to ensure that all service delivery commitments can be met and to protect the long-term sustainable future of operations. This commitment is in line with the Operational guidance No 43 (Charity Income Reserves) issued by the Charity Commission which seeks to guarantee financial security and ensure a sufficient level of reserves.

Free reserves cover has increased slightly in the year to £147k which corresponds to 1 month at year end (2020/21: 1 month). We report a cash position at year end of £353k. This equates to 2 months cover (2020/21: 4 months cover).

Our reserves policy is to aim to maintain sufficient cash reserves to cover at least 3 months future expenditure. This policy is regularly reviewed to ensure that it continues to be appropriate and sufficient.

RISK MANAGEMENT

We continue to assess, review, monitor and plan for all risks which the organisation may face, now or in the future. Our risk management strategy comprises a risk register of all aspects of the organisation and its activities, outlining possible risks which may occur, procedures to mitigate the risks identified and regular re¬ assessments both of the risks already outlined on the register and of potential new risks. This process raises awareness of risk and assists with the development of robust contingency plans.

KEY RISKS

There has been a change to the funding landscape with increase in competition and reduction in funds available from usual sources as a result of the ongoing challenges coming out of the pandemic and the cost of living crisis.

To mitigate this risk there has been a move to increase our statutory (ESFA) funding for our existing programmes including Traineeships. There has also been a focus on renewing existing partners as trends in Corporate Giving is to remain with the existing portfolio. We are also continuing to build new strategic partnerships, to assist us in future delivery. We encourage each partner to contribute in three keyways; by supporting us financially, by engaging in mutually beneficial staff volunteering opportunities; and by providing our young people with work-placements, apprenticeships and full-time employment opportunities. We are also

Page 5

City Gateway Trustees Report for the year ended 31 August 2022

creating a Fundraising Committee, which will draw on the ideas and contacts of our trustees, and external fundraising experts, to further develop our strategy and maximise our effectiveness at networking.

The Board have assessed Brexit and Covid-19 and concluded that this does not pose a specific risk to the organisation.

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

The Trustees (who are also the directors of City Gateway for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice.

Company law requires the Trustees 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 income and expenditure of the charitable company for that period. In preparing those financial statements, the Trustees are required to:

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

So far as the Trustees are aware, there is no relevant information (as defined by Section 418 of the Companies Act 2006) of which the charitable company's auditor is unaware, and each Trustee has taken all the steps that they ought to have taken as a Trustee in order to make them aware of any audit information and to establish that the charitable company's auditor is aware of that information.

ON BEHALF OF THE BOARD:

............................................. Kenny Imafidon Trustee

Date: 16 March 2023

Page 6

City Gateway Report of the independent auditor to the members of City Gateway

OPINION

We have audited the financial statements of City Gateway (the ‘parent charity’) and its subsidiary (the ‘group’) for the year ended 31 August 2022 which comprise the Consolidated Statement of Financial Activities, the Consolidated and Parent Charity Balance Sheets, the Consolidated Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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:

BASIS FOR OPINION

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

CONCLUSIONS RELATING TO GOING CONCERN

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

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

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

OTHER INFORMATION

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

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Page 7

City Gateway Report of the independent auditor to the members of City Gateway

OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006

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

MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION

In light of the knowledge and understanding of the group and the parent charity and their environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Report which includes the Directors’ Report

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

RESPONSIBILITIES OF TRUSTEES

As explained more fully in the trustees’ responsibilities statement set out on page 6, the trustees 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 group’s and the parent charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the group or the parent charity 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 the financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.

Based on our understanding of the group and the parent charity and their industry, we considered that noncompliance with the following laws and regulations might have a material effect on the financial statements: employment regulation and health and safety regulation.

To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:

Page 8

City Gateway Report of the independent auditor to the members of City Gateway

We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, the Companies Act 2006 and Charities Act 2011.

In addition, we evaluated the trustees’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to income recognition (which we pinpointed to the cut-off assertion) and significant one-off or unusual transactions.

Our audit procedures in relation to fraud included but were not limited to:

There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

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

USE OF THE AUDIT REPORT

This report is made solely to the charity’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 charity’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 charity and the charity’s members as a body for our audit work, for this report, or for the opinions we have formed.

Signed: Nicola Wakefield (Apr 5, 2023 17:20 GMT+1)

Nicola Wakefield (Senior Statutory Auditor)

For and on behalf of Mazars LLP

Chartered Accountants and Statutory Auditor

6 Sutton Plaza

Sutton Court Road Sutton SM1 4FS

Date: 05-Apr-2023

Page 9

City Gateway Consolidated Statement of Financial Activities for the year ended 31 August 2022

Note
Income
Donations and legacies
2
Income from Investments
Income from charitable activities
3
Total income
Expenditure
Charitable activities
4
Total expenditure
NET MOVEMENT IN FUNDS
Total funds brought forward
Total funds carried forward
12,13		 General
Funds
Restricted
Funds
2022 Total
Funds
2021 Total
Funds
£
£
£
£
(note 20)
473,652
119,414
593,066
551,317
188
-
188
59
782,682
282,881
1,065,563
1,046,575
1,256,522
402,295
1,658,817
1,597,951
1,227,149
402,295
1,629,444
1,586,730
1,227,149
402,295
1,629,444
1,586,730
29,373
-
29,373
11,221
117,821
-
117,821
106,600
147,194
-
147,194
117,821

All amounts relate to continuing activities and there are no other gains or losses other than as disclosed in the statement of financial activities.

The notes form part of these financial statements

Page 10

City Gateway Consolidated Balance sheet at 31 August 2022

Note
FIXED ASSETS
Tangible assets
8
Intangible assets
8
Investments
9
CURRENT ASSETS
Debtors: amounts falling due within one year 10
Cash at bank and in hand
CREDITORS
Amounts falling due within one year
11a
NET CURRENT ASSETS
CREDITORS
Amounts falling due after more than one
year
11b
NET ASSETS
FUNDS
12,13
Unrestricted funds
Restricted funds
TOTAL FUNDS		 2022
£
153,758
12,251
621
166,630
368,813
353,550
722,363
(431,631)
290,732
(310,168)
147,194
147,194
-
147,194		 2021
£
177,243
20,898
621
198,762
148,367
640,603
788,970
(526,561)
262,409
(343,350)
117,821
117,821
-
117,821

These financial statements have been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 relating to small charitable companies and have been audited under the Companies Act 2006.

The financial statements were approved by the Board of Trustees on and were signed 16 March 2023 on its behalf by:

............................................. Kenny Imafidon

Trustee

Page 11

City Gateway Charity Balance sheet at 31 August 2022

Note
FIXED ASSETS
Tangible assets
8
Intangible assets
8
Investments
9
Investment in subsidiary
9
CURRENT ASSETS
Debtors: amounts falling due within one year 10
Cash at bank and in hand
CREDITORS
Amounts falling due within one year
11a
NET CURRENT ASSETS
CREDITORS
Amounts falling due after more than one
year
11b
NET ASSETS
FUNDS
12,13
General funds
Restricted funds
TOTAL FUNDS		 2022
£
153,758
12,251
621
100
166,730
375,445
352,934
728,379
(431,631)
296,748
(310,168)
153,310
153,310
-
153,310		 2021
£
177,243
20,898
621
100
198,862
154,474
639,796
794,243
(535,688)
268,555
(343,350)
124,067
124,067
-
124,067

These financial statements have been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 relating to small charitable companies and have been audited under the Companies Act 2006.

The financial statements were approved by the Board of Trustees on and were signed 16 March 2023 on its behalf by:

............................................. Kenny Imafidon

Trustee

Page 12

City Gateway Consolidated Statement of Cash Flows for the year ended 31 August 2022

Cash flows from operating activities
Net income
Adjustments for:
Depreciation
Amortisation
Interest income
Interest expense
Trade and other debtors
Trade and other creditors
Cash flows (used in)/generated by
operating activities
Purchase of property plant and equipment
Purchase of intangible fixed assets
Interest received
Cash flows used in investing activities
Interest paid
Loans repaid in the year
New loans received in the year
Cash flows (used in)/generated by
financing activities
Net decrease in cash
Cash balance at 1 September
Cash balance at 31 August		 2022
£
29,373
48,907
8,647
(188)
4,961
(220,445)
46,643
(25,420)
188
(4,961)
(81,472)
-


 2022
£
(175,388)
(25,232)
(86,433)

(287,053)
640,603

353,550		 2021
£
11,221
54,810
15,896
(59)
-
(59,113)
63,152
(86,860)
(25,942)
59
(7,228)
(37,973)
50,000		 2021
£
85,907
(112,743)
4,799

(22,037)
662,640
640,603

Page 13

City Gateway Notes to the financial statements for the year ended 31 August 2022

1. ACCOUNTING POLICIES

Accounting convention

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)) and the Companies Act 2006.

City Gateway 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).

Under s408 of the Companies Act 2006 the charitable company is exempt from the requirement to present its own Statement of Financial activities. The surplus for the year for the charitable parent company was £29,242 (2021: surplus of £11,102).

Going concern

The trustees consider that it is appropriate for these financial statements to be prepared on the going concern basis given the level of assets and the forecast results for 2021/22.

The trustees have reviewed detailed cash flow projections to 31 March 2024. Both sources of income and types of expenditure have been reviewed including sensitivity analysis. The charity is teaching students in person and our current funding partners remain committed to supporting delivery of our mission in the medium to long term. The trustees have also considered the charity's working capital and capital expenditure requirements. As a result of the foregoing the trustees are satisfied that it is appropriate to prepare the accounts on a going concern basis.

Income

All income is included on the Statement of Financial Activities (SOFA) when the charity is legally entitled to the income and the amount can be quantified with reasonable accuracy.

Income received in advance on contracts, performance related grants and grants for future periods is carried through to the Balance Sheet as deferred income and included in creditors. Where it is probable that income received will be claimed back, this amount is included in the SOFA as an income provision and is also included on the Balance Sheet as a creditor.

Expenditure

Expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all cost related 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.

Intangible fixed assets

Software costs have been capitalised at historic cost and amortised on a straight line basis between 2 years and 5 years.

Page 14

City Gateway Notes to the financial statements for the year ended 31 August 2022

Tangible fixed assets

Depreciation is provided at rates calculated in order to write off each asset evenly over its estimated useful life. Individual items costing under £1,000 are written off on purchase. Estimated useful life of assets is as follows:

Leasehold properties -Over the period of the lease Fixtures and fittings -1 to 5 years Computer equipment -3 years Motor vehicles -5 years

Taxation

The charity is exempt from corporation tax on its charitable activities.

Fund accounting

Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees. Designated funds are those unrestricted funds which the trustees have earmarked to be used for a particular purpose.

Restricted funds can only be used for particular restricted purposes within the objects of the charity. Restrictions arise when specified by the donor or when funds are raised for particular restricted purposes.

Further explanation of the nature and purpose of each fund is included in the notes to the financial statements.

Operating leases

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

Pension scheme

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

Page 15

City Gateway Notes to the financial statements for the year ended 31 August 2022

2. VOLUNTARY INCOME
2022 2021
£ £
Individual donations & Fundraising events 51,723 37,161
Corporate donations 516,557 262,667
Gifts in kind - 7,319
Other 24,786 244,170
593,066 551,317

Corporate donations includes £119,414 (2021: £110,676) of restricted donations. All other balances in the current and prior year are unrestricted.

3. INCOME FROM CHARITABLE ACTIVITIES

INCOME FROM CHARITABLE ACTIVITIES
Statutory income
Other grants and contracts
Apprenticeship Training Agency		 2022
£
777,510
288,053
-
1,065,563		 2021
£
674,556
369,628
2,391
1,046,575

Other grants and contracts includes £282,881 (2021: £255,957) of restricted income. All other balances in the current and prior year are unrestricted.

Page 16

City Gateway Notes to the financial statements for the year ended 31 August 2022

4. EXPENDITURE ON CHARITABLE ACTIVITIES

Young People’s
education,
training and
progression
£
Direct charitable
activities
666,339
Support costs
553,124

Total
1,219,463
Support costs broken
down by activity
Senior management
108,511
Finance & contract
management
186,472
Premises, Facilities &
IT
109,810
HR & Staff
development
28,721
Marketing &
communication
119,610
Gift
in
kind:
Professional services
-

Total support costs
553,124		 Family
programme
s
£
64,891
53,867
118,760
10,568
18,159
10,694
2,797
11,649
-
53,867		 Apprentic
eship
Training
Agency
£
159,130
132,093
291,223
25,914
44,532
26,224
6,859
28,564
-
132,093		 2022
£
890,360
739,084
1,629,444
144,993
249,163
146,728
38,377
159,823
-
739,084		 2021
£
866,900

719,830
1,586,730
135,753
288,362

175,452
37,431
75,514
7,318
719,830

Direct charitable activities includes £402,295 of restricted expenditure (2021: £381,099) and Support costs includes £nil of restricted expenditure (2021: £NIL). All other balances in the current and prior years are unrestricted.

Apportionment of support costs between activities is based on direct charitable activities.

5a. GOVERNANCE COSTS (included in Support Costs above)

2022 2021 £ Auditor remuneration 13,200 16,152

Page 17

City Gateway Notes to the financial statements for the year ended 31 August 2022

5b. NET INCOME / (EXPENDITURE)

Net movements in funds are stated after charging:

Auditor’s remuneration – audit fees
Depreciation/amortisation - owned assets
Other operating leases		 2022
£
13,200
57,554
119,762		 2021
£
16,152
70,706
127,963

6. TRUSTEES' REMUNERATION AND BENEFITS

The Chair was not paid during the year ended 31 August 2022 or the year ended 31 August 2021. No other trustee received any remuneration during the current or prior years.

Trustees' Expenses

No trustees claimed expenses during the year ended 31 August 2022 or the year ended 31 August 2021.

7. STAFF COSTS

2022
£
Wages and salaries
903,089
Social security
93,342
Pension
62,323
Redundancy costs
12,895
Other staff costs
91,183
1,161,833
The average monthly number of employees during the year was as follows:
2022 No.
Permanent staff
26
26
Employees who earned more than £60,000 p.a. are as follows:
2022 No.
£60,001 - £70,000
-
£70,001 - £80,000
-
£80,001 – £90,000
1
1		 2021
£
918,773
87,568
58,256
-
32,319
1,096,916
2021 No.
30
30.
2021 No.
1
1
-
2		 2021
£
918,773
87,568
58,256
-
32,319
1,096,916

Key management personnel comprises the Chief Executive, the Development Director, the Head of Finance and the Head of Outreach & Marketing. The total employee benefits of the key management personnel of the charity were £346,343 (2021: £324,489).

Page 18

City Gateway Notes to the financial statements for the year ended 31 August 2022

8. TANGIBLE & INTANGIBLE FIXED ASSETS

Page 19
GROUP & CHARITY
Leasehold
Properties
Fixtures
and
fittings
£
£
COST
At 1 September 2021
165,886
15,039
Additions
-
6,560
Disposals
-
-
At 31 August 2022
165,886
21,599
DEPRECIATION/AMORTISATION
At 1 September 2021
49,086
14,313
Charge for the year
16,589
1,741
Released on disposal
-
-
At 31 August 2022
65,675
16,054
NET BOOK VALUE
At 31 August 2022
100,211
5,545
116,800
726
At 31 August 2021
9.
FIXED ASSET INVESTMENTS
GROUP AND CHARITY
MARKET VALUE
At 1 September 2021 and at 31 August 2022
NET BOOK VALUE
At 31 August 2022
At 31 August 2021
There were no investment assets outside the UK.
INVESTMENTS IN SUBSIDIARY
COST
At 1 September 2021 and at 31 August 2022		 Computer
Equipment
£
106,862
18,862
-
125,724
47,145
30,577
-
77,722
48,002
59,717		 Tangible
Fixed
Assets
Totals
Intangible
Fixed
Assets
Totals
£
£
287,787
64,023
25,422
-
-
-
313,209
64,023
110,544
43,125
48,907
8,647
-
-
159,451
51,772
153,758
12,251
177,243
20,898
Listed
investments
£
621
621
621
£
100		 Intangible
Fixed
Assets
Totals
£
64,023
-
-
64,023
43,125
8,647
-
51,772
12,251
20,898

City Gateway Notes to the financial statements for the year ended 31 August 2022

9. FIXED ASSET INVESTMENTS (CONTINUED)

9. FIXED ASSET INVESTMENTS (CONTINUED)
Subsidiaries included in consolidation
% of capital
held
City Gateway Enterprises Limited
100%
10.
DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
GROUP
Debtors
Accrued income
Other debtors & prepayments
CHARITY
Debtors
Accrued income
Other debtors & prepayments
Intercompany debtors
11a. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
GROUP
Trade creditors
VAT
Other creditors
Accruals
Deferred income
Other loans (see note 11c)
CHARITY
Trade creditors
Other creditors
Accruals
Deferred income
Other loans (see note 11c)		 Net liabilities at
31 August 2022
Profit for the
year ended 31
August 2022
£
£
(6,023)
131
2022
2021
£
£
-
-
342,285
92,152
26,528
56,215


368,813
148,367


2022
2021
£
£
-
-
342,285
92,152
26,269
56,106
6,890
6,216


375,445
154,474


2022
2021
£
£
83,462
16,408
-
(220)
27,196
23,460
18,934
117,196
258,796
321,491
43,243
48,226


431,631
526,561


2022
2021
£
£
83,462
16,408
27,196
33,467
18,934
116,096
258,796
321,491
43,243
48,226


431,631
535,688
2022
£
-
342,285
26,528

368,813

2022
£
-
342,285
26,269
6,890

375,445

2022
£
83,462
-
27,196
18,934
258,796
43,243

431,631

2022
£
83,462
27,196
18,934
258,796
43,243

431,631

Page 20

City Gateway Notes to the financial statements for the year ended 31 August 2022

11b. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

GROUP AND CHARITY
Accruals
Deferred income
Other creditors
Loans		 2022
£
156,354
116,608
-
37,206

310,168		 2021
£
66,348
196,553
10,000
70,449

343,350
11c.
MATURITY OF LOANS
GROUP AND CHARITY
Loans repayable in one year or less
Between one and two years
Between two and five years
After more than five years		 43,243
13,932
23,274
-

80,449		 2022
£
48,226
37,243
30,555
2,651
118,675		 2021
£
37,972
41,118
27,557
-

106,647

The charity has two loans drawn down in 2019/20 which are unsecured and bearing interest at 8%.

12. UNRESTRICTED FUNDS

CHARITY
Unrestricted funds:
General funds
GROUP
Unrestricted funds:
General funds		 At 1
September
2021
£
124,067
At 1
September
2021
£
117,821		 Income
£
1,256,230
Income
£
1,256,522		 Expenditure
£
(1,226,987)
Expenditure
£
(1,227,149)		 Transfers
in/out
At 31
August
2022
£
£
-
153,310
Transfers
in/out
At 31
August
2022
£
£
-
147,194

Page 21

City Gateway Notes to the financial statements for the year ended 31 August 2022

13. RESTRICTED FUNDS

3.
RESTRICTED FUNDS
GROUP AND CHARITY
Awards for All
Centerbridge
Greater London Authority
London Catalyst (Samaritan Grant)
Ocean Regeneration Trust
St James Place
The 29th May 1961 Charitable Trust
BBC Children in Need
Good Things Foundation
Charles Hayward Foundation
The London Community Foundation
The Hobson Charity Limited
Jack Petchey Foundation
The Rayne Foundation
Total restricted funds		 At 1
September
2021
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-		 Income
£
8,253
83,333
36,081
1,200
12,685
30,000
20,000
18,649
39,289
25,000
109,325
9,430
1,200
7,850
402,295		 Expenditure
£
(8,253)
(83,333)
(36,081)
(1,200)
(12,685)
(30,000)
(20,000)
(18,649)
(39,289)
(25,000)
(109,325)
(9,430)
(1,200)
(7,850)
(402,295)
At 31
August
2022
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-

Awards for All Family Support Worker & Holiday Programme Centerbridge City Gateway 3 Year Growth Plan Support Greater London Authority Covid-19 response (Capital funding) London Catalyst (Samaritan Grant) To assist people in severe need. Ocean Regeneration Trust Support Women's programmes at Stepney Life Centre St James Place Student Support Programme The 29th May 1961 Charitable Trust Youth programme Support (NEET aged 16-24 who face multiple disadvantages) BBC Children in Need Capital funding Good Things Foundation Power Up 2.0 project Charles Hayward Foundation Family support funding The London Community Foundation Skill Up Step Up Employability Fund The Hobson Charity Limited Capital funding Jack Petchey Foundation Learner support The Ryne Foundation To Support an innovative remote work placements

Page 22

City Gateway Notes to the financial statements for the year ended 31 August 2022

14. ANALYSIS OF NET ASSETS BETWEEN FUNDS

GROUP
Tangible Fixed assets
Intangible Fixed assets
Investments
Current assets
Creditors due within one year
Creditors due after more than one year
Net assets at 31 August 2022		 Unrestricted
General
Funds
Restricted
Funds
Total
Funds
2022
Total
Funds
2021
£
£
£
£
153,758
-
153,758
177,243
12,251
-
12,251
20,898
621
-
621
621
722,363
-
722,363
788,970
(431,631)
-
(431,631)
(526,561)
(310,168)
-
(310,168)
(343,350)
147,194
-
147,194
117,821

15. CITY GATEWAY ENTERPRISES LIMITED

City Gateway has a wholly owned subsidiary, City Gateway Enterprises Limited which was incorporated in the United Kingdom on 8 October 2012. A summary of its trading results is shown below. The investment in this subsidiary is included in the charity balance sheet at a value of £100. The net liabilities of the subsidiary are £6,023)

Turnover
Cost of sales
Gross profit
Administrative expenses
Retained in the subsidiary
Total assets of subsidiary
Total liabilities of subsidiary
Equity shareholders’ deficit
Share capital
Net liabilities		 Year ended
31 August
2022
£
293
-
293
(162)
131
867
(6,890)
(6,123)
100
(6,023)		 Year ended
31 August
2021
£
16,716
-
16,716
(16,598)
118
1,063
(7,317)
(6,254)
100
(6,154)

16. GUARANTEE STATUS

The company is limited by guarantee, which means that every member undertakes to contribute to the assets of the charity in the event of a winding up, such amounts as may be required not exceeding one pound.

Page 23

City Gateway Notes to the financial statements for the year ended 31 August 2022

17. OPERATING LEASE COMMITMENTS

At 31 August 2022 the charity had commitments under non-cancellable operating leases as follows:

Less than 1 year
Between 2 and 5 years
More than 5 years
Total		 Land and buildings
2022
£
2021
£
80,584
193,402
773,608
177,285
209,519
-
1,063,711
370,687

18. RELATED PARTY TRANSACTIONS

Due to the nature of the Charity’s operations and composition of its Trustees, it is possible that there will be transactions from time to time between the Charity and organisations with which Trustees of the Charity have a relationship. If such transactions do occur, they are conducted on an arm-length basis and in compliance with the Charity’s Financial Regulations and Policies.

During the period, City Gateway engaged in the following transactions with the wholly owned subsidiary City Gateway Enterprises Limited:

During the year purchases of £18,860 (2021: £nil) were made from a company where a family member of a City Gateway executive is the director and shareholder

19. PENSION COMMITMENTS

The charity operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the charity in independently administered funds. The pension cost charge represents contributions payable by the charity to the funds and amounted to £62,323 (2021 - £58,256). At the year end there was an outstanding creditor of £5,543 (2021: £nil).

Page 24

City Gateway Notes to the financial statements for the year ended 31 August 2022

20. COMPARATIVE STATEMENT OF FINANCIAL ACTIVITIES

Income
Donations and legacies
Income from Investments
Income from charitable
activities
Total income
Expenditure
Charitable activities
Total expenditure
Net income/(expenditure)
Total funds brought forward
Total funds carried forward		 General funds
Restricted
Funds
2021
Total Funds
£
£
£
440,641
110,676
551,317
59
-
59
790,618
255,957
1,046,575
1,231,318
366,633
1,597,951
1,205,631
381,099
1,586,730
1,205,632
381,099
1,586,730
25,687
(14,466)
11,221
92,134
14,466
106,600
117,821
-
117,821

Page 25