**Registered number: 04527579 Charity number: 1094451**
## **SWARTHMORE EDUCATION CENTRE**
**(A company limited by guarantee)**
**TRUSTEES' REPORT AND FINANCIAL STATEMENTS**
**FOR THE YEAR ENDED 31 JULY 2022**
## **SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **CONTENTS**
||Page|
|---|---|
|**Reference and administrative details of the company, its Trustees and advisers**|1|
|**Chairman's statement**|2 - 3|
|**Trustees' report**|4 - 10|
|**Independent auditors' report on the financial statements**|11 - 14|
|**Statement of financial activities**|15|
|**Balance sheet**|16|
|**Statement of cash flows**|17|
|**Notes to the financial statements**|18 - 34|
**SWARTHMORE EDUCATION CENTRE**
**(A company limited by guarantee)**
## **REFERENCE AND ADMINISTRATIVE DETAILS OF THE COMPANY, ITS TRUSTEES AND ADVISERS FOR THE YEAR ENDED 31 JULY 2022**
|**Trustees**|Mr P Hall (resigned 31 March 2022)|
|---|---|
||Ms A W M Katung (resigned 31 May 2022)|
||Mrs D Hodgkinson (resigned 31 March 2022)|
||Dr E J Roberts (resigned 31 December 2021)|
||Mr N H Zaman|
||Ms C L Walker|
||Ms K J Badon|
||Mrs S Sinha|
||Dr E J Watkins|
||Ms C Wigzell (resigned 31 March 2022)|
||Mr I Greenwood|
||Ms M Ellis (resigned 31 March 2022)|
||Mr J L Arnison (appointed 31 March 2022, resigned 26 October 2022)|
||Mrs S L Taylor (appointed 31 March 2022)|
||Miss L R Huxley (appointed 31 March 2022)|
|**Company registered**
**number**
04527579
**Charity registered**
**number**
1094451
**Registered office**
2/7 Woodhouse Square
Leeds
LS3 1AD
**Company secretary**
C Baillie
**Senior management**
**team**
P Johnson
A Torbitt
J Macleod
C Baillie
S Emmett
**Independent auditors**
Sagars Accountants Ltd
Gresham House
5-7 St Pauls Street
Leeds
LS1 2JG||
Page 1
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **CHAIR'S STATEMENT FOR THE YEAR ENDED 31 JULY 2022**
This has been my fifth year as Chair of the Trustee Council at Swarthmore and the Trustees were very pleased to be able to reopen the Centre to learners after the long COVID lockdown. We were well placed to make this a year of strong recovery despite the ongoing prevalence of COVID, with the Omicron variant hitting us hardest in December 2021, just as the Government support came to an end. We also had to deal with the reality that for some people who may have otherwise come along to Swarthmore, there was still a degree of caution about returning to face-to-face learning. Despite that, over the full financial year we saw slowly the numbers of new learners coming to Swarthmore increasing and thus benefitting from our many and varied adult education courses. Part of the increase was down to our ongoing blended learning approach, keeping some digital classes alongside our face-to-face ones and a mix of both. We continued to make great strides forward on the digital delivery front and we were proud to win the Educate North award for Digital Education and Development in April 2022, against stiff competition. This was a great testament to both the quality and innovation of our digital delivery at Swarthmore.
We continued to invest in our building, fully refurbishing the hall, decorating, and refreshing all classrooms and creating an improved and positive learning environment throughout. We restarted our room hire in earnest in Spring 2021 and as a result we have seen a slow increase in room hire uptake. We placed purifiers in many rooms, reducing greatly the potential for spread of infection. We continued to invest in our IT infrastructure to enable our business to grow, and we achieved the Cyber Essentials as required. Our ambition looking forward is to work toward Cyber Essentials Plus in the coming year.
This year also saw Swarthmore deliver a uniquely tailored programme for a number of Ukrainian refugees who came to Leeds. Our programme aimed to support the refugees and enable them to assimilate well in our city by gaining skills, knowledge and ultimately jobs. Not only did the programme support the refugees, but it also enabled our civic leaders and host families to deliver on their ambitions to provide a safe place with a future and promise of hope. Our Art at the Heart project, funded by the European Social Fund, enabled the sharing of creativity with many who would otherwise not get that opportunity.
This year we were able to reopen our on-site café, recreating our community and exhibition space, thus bringing the heart back into Swarthmore. This in turn has helped with the mental health of many who had felt isolated and lonely during COVID lockdown.
The Study Programme - that delivers to a wide range of students aged between 18 and 24 - continued to show steady growth. Our specially tailored programme for each student, taking full account of their needs requires special teaching skills and patience, but in return it offers the genuine reward of making a real difference in their lives, in their families lives and within their communities. We were particularly proud this year as for the first time one of our Study Programme students accepted a place at University after he gained three A levels - two A* and one grade A. What a fantastic achievement. The Study Programme achieved an amazing 100% pass rate for GCSE's, whilst across the Centre our overall pass rate was 95%.
To enable us to deliver education in the widest sense, we continued during the year to work with a wide range of partners including Leeds University, Pyramid Arts, many employers in the area, Leeds Older People's Forum and the Age Friendly Steering Group. Our ongoing relationships with close partners, including Leeds City Council, Leeds City College and MoJ continued to grow and improve, providing much needed income to the Centre .
Page 2
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **CHAIR'S STATEMENT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
Financially, we had income from ESFA £882,973, Leeds City Council £443,800 and Leeds City College £39,107 alongside our income from paying students, room hire and our café. Despite all of this we still disappointingly ended the year in a deficit position, which means we must now move forward to a year of growth.
So, looking forward, to achieve the growth necessary we will have ongoing improvements by investing further in our staff, our building and our governance which will enable us to realise further the full potential in the Centre, based on a strong strategic business plan.
So may I close this report with many thanks to all our students for supporting Swarthmore, to our incredible staff who work tirelessly to deliver high quality education, to our management team that continues to grow stronger, to our Director, Chris Baillie, who has set a high standard in the Centre and created a positive culture across the organisation and last but not least to all the Trustees, who give their time freely to provide Swarthmore with strategic leadership. By working together, putting the best interests of Swarthmore first, we are making a difference in many lives.
I am looking forward to continued improvements in the coming year so we can continue to realise our full potential as an organisation as the adult education provider across Leeds.
Julie Badon Date: 21 February 2023
Page 3
**SWARTHMORE EDUCATION CENTRE**
**(A company limited by guarantee)**
## **TRUSTEES' REPORT FOR THE YEAR ENDED 31 JULY 2022**
The Trustees present their annual report together with the audited financial statements of the Swarthmore Education Centre for the year 1 August 2021 to 31 July 2022. The annual report serves the purposes of both a Trustees' report and a directors' report under company law. The Trustees confirm that the annual report and financial statements of the charitable company comply with the current statutory requirements, the requirements of the charitable company's governing document and the provisions of the Statement of Recommended Practice (SORP) applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) (effective 1 January 2019).
## **Objectives and activities**
## **Policies and objectives**
The objects of the company shall be to promote the education of the residents of Leeds and surrounding areas through the provision of an educational establishment, and in particular but not exclusively:
(a) to provide a learning community for personal development and social activity for those who may have been excluded from mainstream educational opportunities;
(b) to provide opportunities and activities for the benefit of the community based on the recognition of the skills and experience which all people bring.
The vision that shapes our annual activities remains the promotion of education, encouragement to participate through friendly learning whilst ensuring equality of opportunity for all. The charity also has the general aim of contributing to the quality of life of the people of Leeds by expanding their horizons through the provision of exciting, challenging and accessible professional and community courses and events.
In shaping our objectives for the year and planning our activities, the trustees have considered the Charity Commission's guidance on public benefit, including the guidance "public benefit: running a charity (PB2)". Swarthmore relies on a combination of public funding and the income from fees and charges to cover its operating costs. Affordability and access to our courses and activities is important to us and is reflected in our pricing policy set out in detail later in this report.
The year 2021/2022 was our post covid ‘Recovery year’. The Centre opened to face to face classes in adult delivery, (LCC/Full Cost, etc) the café reopened on reduced hours of opening, room hire was available for booking, and we had a number of successful exhibitions throughout the year. Study Programme numbers increased, and a blended approach to continuous learning remained in place for our most vulnerable learners. The first term was affected by the Omicron variant, and numbers were still low for recruitment, which was still predominantly online in the first term, with face to face classes increasing over the year. We invested in air purifiers across the Centre to provide a safe environment for students, staff and visitors.
We successfully applied for funding for a small project working with refugees in the Centre. Art at the Heart was funded by the ESF, and we engaged with the Ukrainian community to deliver an arts and ESOL programme, culminating in a well attended celebration event in August 2022. Our commitment to engaging with those furthest away from education and training remains a key factor in our provision.
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## **SWARTHMORE EDUCATION CENTRE**
## **(A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Objectives and activities (continued)**
In April 2022, we won the Educate North Digital Education and Development Award for our Swarthmore Connected project. A proud achievement for our work during the pandemic.
We endeavour to encourage all within our community to participate in our activities and to enjoy our cafe and/or to view our exhibitions. The courses we provide, both accredited and non-accredited, are to be enjoyed by all, from the young adults attending our full-time study programme, our supported adult classes, classes for working and retired adults and those seeking work.
The strategies employed to achieve the charity's aims and objectives are to:
- Deliver a broad range of courses, events and exhibitions for the enjoyment and education of our local community.
- Offer opportunities for a broad range of adults to get involved in education, personal enrichment, developing their confidence, self-esteem, employability, digital skills, knowledge and understanding.
- Provide facilities for like-minded organisations to hold meetings, give talks and hold events at discounted rates for hire of space.
- Provide facilities for our students, staff and members of the public to eat and socialise in our Cafe at affordable prices for all of our community.
- Provide information, advice and guidance to all adults to help them prepare for their next steps to education, employment and volunteering.
## Adult Education programmes
We aim to offer an extensive range of courses in the Arts, Languages, Health and Wellbeing, Maths, English and ICT. These range in level from entry to level 3, accredited and non-accredited, short and year long courses. We work with partners to deliver courses and activities out in the community to reach groups of people that would not normally access the Centre. Our full cost courses were reinstated this year, offering one day workshops and longer courses ranging from 6 hours to 12 weeks in length.
## **Study Programme**
We provide a full time study programme for young adults with learning difficulties who develop skills to improve their independence and support them to progress to further learning, work or volunteering opportunities. The success of the programme was further celebrated by one of our students gaining 3 A levels at grades A A*A* and securing a place at University. The ESFA contract increased this year and our contractual arrangements continued.
Flexible learning enables students to access education in a way and at a pace that suits their needs. The study programme was inspected by Ofsted in November 2017 and maintained its grade 2, Good.
## **Volunteers**
Swarthmore is fortunate to have a number of volunteers, who this year provided invaluable support to our funded projects, such as Art at the Heart.
Page 5
## **SWARTHMORE EDUCATION CENTRE**
**(A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Objectives and activities (continued)**
## **Hire of facilities**
The Centre has a number of rooms for hire ranging from small meeting rooms to our large hall and art studios. We provide these facilities at discounted rates for charities and community groups so they can hold meetings, events and courses. The Centre is utilised by occasional users as well as long established groups, such as Leeds People's Choir. Although there was an increase in fees for room hire this year, we remain competitive, and we have continued to see growth in this area.
## **Cafe**
The cafe is the social hub of the Centre and is a valuable resource to students, members of the public and staff. It also provides an environment for exhibitions. The café returned this year, albeit with reduced hours.
## **Information and advice**
We continued to provide high quality, impartial and free information and advice to our prospective students throughout the year. We achieved the Matrix standard this year.
## **Strategic report**
## **Achievements and performance**
## **Main achievements of the company**
**----- Start of picture text -----**
2021/22 2020/21 2019/20
**----- End of picture text -----**
||**2021/22**|**2020/21**|**2019/20**|
|---|---|---|---|
|||||
|Students enrolled onto a
course at Swarthmore|771|555|1,674|
|Courses delivered|176|171|343|
|Swarthmore (self-
financing) students
completed and achieved|77.4%|n/a|94.2%|
|Leeds City Council (non-
accredited) students
completed and achieved|70.1%|84.6%|89.5%|
|Leeds City College
(accredited) students
completed and achieved|-|85.0%|89.1%|
## **Fundraising activities and income generation**
The Charity does not use any professional fundraiser or commercial participator to carry out activities on the Charity's behalf. Due to the low level of fundraising the Charity undertakes, the Charity is not a participator of any voluntary scheme for regulating fundraising, or any voluntary standard of fundraising for the activities carried out on behalf of the Charity.
Page 6
**SWARTHMORE EDUCATION CENTRE**
**(A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Strategic report (continued)**
## **Financial review**
## **Reserves Policy and Going concern**
Reserves are needed to bridge the gap between the spending and receiving of income and to cover unplanned emergency repairs and other expenditure. The trustees consider three months of expenditure to be the ideal level of reserves. Based on our current operations, monthly expenditure is estimated to be around £150,000, meaning the reserves to be held at 31st July should exceed £450,000. Current free reserves stand at £148,366, backed up by Fixed Assets of £1,157,471 total unrestricted funds of £1,305,837. This indicates a deficit of £301,634 in current reserves. The trustees acknowledge the policy, and continue to address all areas for improvement, including focussing on quality and the learner experience.
## **Deficit**
Swarthmore Education Centre finished with a deficit of £98,923 in the Year to 31st July 2022 compared to a deficit of £13,165 in the previous year.
## **Risk management**
Financial sustainability is the major financial risk for the charity, especially in the context of a recovery year post pandemic. A key element in the management of financial risk is a regular review of available liquid funds to settle debts as they fall due and active management of trade debtors and creditors balances to ensure sufficient working capital by the charity. Attention continued to be focussed on implementing systems and procedures to mitigate financial risks where possible.
## **Principal funding**
The principal sources of income to the Centre were:
- ESFA funding for the Study Programme of £882,973
- Leeds City Council funding of £443,800 (Includes Funding for Inclusion)
- Student Fees of £126,907
The support of our partners continues to be essential in maintaining such a varied programme of courses, including Maths, English, a wide variety of arts, health and wellbeing, languages and counselling.
A planned restructure was implemented and following the consultation period in the summer of 2021, a small number of staff had requested voluntary redundancy. New roles were agreed with a renewed focus on improving the student experience and developing external links to provide us with a range of new/additional income opportunities whilst maximising existing relationships.
Swarthmore continues to explore opportunities for additional funding, building upon its relationship with Leeds City Council, and establishing new relationships with funders such as The National Lottery. Pressure to retain existing funding streams while establishing new sources continued to be a challenge throughout the year as the Centre slowly recovered from the impact of the pandemic.
Page 7
## **SWARTHMORE EDUCATION CENTRE**
## **(A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Our Pricing Policy**
Our pricing policy reflects our strategy of enabling all within our community, whatever their means, to take part in our courses and activities.
- Self-financing (Swarthmore full cost) courses resumed in September 2021
- In addition to Self-Financing courses, Swarthmore offers a range of courses funded by Leeds City Council. (Free in the previous year, the charges resumed in 2021)
It is the aim of Swarthmore to set prices that are affordable enough to attract students to attend courses, whilst ensuring that enough revenue is generated to make the courses viable. We believe that our courses are exceptional value for money, compared to other organisations, and course fees will continue to be reviewed.
## **Pay policy for senior staff**
The directors consider the board of trustees and the senior management team listed on page 1 as comprising the key management personnel of the charity. All trustees give their time freely and no trustee remuneration was paid. The pay of senior staff is reviewed annually, with the last increase in September 2021.
## **Structure, governance and management**
## **Constitution**
Swarthmore is an incorporated company limited by guarantee and the company's Memorandum and Articles of Association are the legal framework upon which our governance is based. It is a registered charity with the Charity Commission. Anyone over the age of 18 can become a member of Swarthmore once enrolled on a Swarthmore course, and there are currently 510 registered members.
## **Methods of appointment or election of Trustees**
As set out in the Articles of Association the chair of the trustees is nominated by the Trustee Council. Up to 13 members of the Trustee Council are nominated by the members of the charitable company, up to 2 are appointed by the Leeds Society of Friends and up to one third may be co-opted by the Trustee Council to provide specialist skills, subject to an overall maximum of 15 members.
In accordance with the Articles of Association all officers and co-opted members and one third of elected members of the Management Committee retire at the Annual General Meeting and being eligible, offer themselves for re-election.
## **Organisational structure and decision-making policies**
The Trustee Council administers the charity. The Council meets monthly and there are currently three subcommittees covering HR, Health and Safety and Finance who also meet regularly. A Chief Executive is appointed by the Trustees to manage the day-to-day operations of the charity. To facilitate effective operations, the Chief Executive has delegated authority, within terms of the delegation approved by the Trustees, for operational matters including finance, employment, and the activities of the Centre.
Page 8
## **SWARTHMORE EDUCATION CENTRE**
## **(A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Structure, governance and management (continued)**
## **Policies adopted for the induction and training of Trustees**
New trustees are given an induction pack and inducted by the Chair of Trustees and other members of the Council. Trustees are encouraged to attend appropriate external training events where these will facilitate the undertaking of their role.
## **Related parties and co-operation with other organisations**
None of our trustees receive remuneration or other benefit from their work with the charity. Any connection between a trustee or senior manager of the charity with any contractual organisation must be disclosed to the full Trustee Council. In the current year no such related party transactions were reported.
## **Plans for future periods**
Our recovery year has seen a steady growth in adult learning delivery, room hire and events. Our Study Programme continued to deliver learning to our students and embraced the new technology available by offering a blended approach to maintain engagement. The study programme has increased in number to 80 students and remains fully subscribed.
Although no longer accessing any government funding, we have seen an increase in income, compared to previous years. Our plan is to increase the uptake in courses, promoting the facilities at the centre, and accessing additional funds where we are able. Recruitment and retention of staff remains a key factor in the success of the Centre, as plans for further growth are in progress.
A review of costs for our courses is in place, particularly in light of the cost of living crisis and costs of materials etc. Although prices have increased, we remain competitive and offer value for money to our students.
Still impacted by the pandemic, we invested in air purifiers and CO2 monitors, making the centre as safe as possible for our community to return.
Refurbishment of our Hall as an entertainment and events space aims to improve our room hire offer, and we are already seeing an increase in bookings, despite an increase in rates.
We continue to strengthen and develop our links with the community, external partners and our customers.
Page 9
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2022**
## **Statement of Trustees' responsibilities**
The Trustees (who are also the directors of the company for the purposes of company law) are responsible for preparing the Trustees' report including the strategic report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
Company law requires the Trustees to prepare financial statements for each financial year. Under company law, the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of its incoming resources and application of resources, including its income and expenditure, for that period. In preparing these financial statements, the Trustees are required to:
- select suitable accounting policies and then apply them consistently;
- observe the methods and principles of the Charities SORP (FRS 102);
- make judgments and accounting estimates that are reasonable and prudent;
- state whether applicable UK Accounting Standards (FRS 102) have been followed, subject to any material departures disclosed and explained in the financial statements;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
## **Disclosure of information to auditors**
Each of the persons who are Trustees at the time when this Trustees' report is approved has confirmed that:
- so far as that Trustee is aware, there is no relevant audit information of which the charity's auditors are unaware, and
- that Trustee has taken all the steps that ought to have been taken as a Trustee in order to be aware of any relevant audit information and to establish that the charity's auditors are aware of that information.
## **Auditors**
The auditors, Sagars Accountants Ltd, have indicated their willingness to continue in office. The designated Trustees will propose a motion reappointing the auditors at a meeting of the Trustees.
Approved by order of the members of the board of Trustees on 21 February 2023 and signed on their behalf by:
**Ms K J Badon** Trustee
Page 10
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SWARTHMORE EDUCATION CENTRE**
## **Opinion**
We have audited the financial statements of Swarthmore Education Centre (the 'charitable company') for the year ended 31 July 2022 which comprise the statement of financial activities, the balance sheet, the statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
- give a true and fair view of the state of the charitable company's affairs as at 31 July 2022 and of its incoming resources and application of resources, including its income and expenditure for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Charities Act 2011.
## **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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
In auditing the financial statements, we have concluded that the Trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.
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**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SWARTHMORE EDUCATION CENTRE (CONTINUED)**
## **Other information**
The other information comprises the information included in the annual report other than the financial statements and our auditors' 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.
## **Matters on which we are required to report by exception**
We have nothing to report in respect of the following matters where the Charities (Accounts and Reports) Regulations 2008 requires us to report to you if, in our opinion:
- the information given in the Trustees' report is inconsistent in any material respect with the financial statements; or
- sufficient accounting records have not been kept; or
- the financial statements are not in agreement with the accounting records and returns; or
- we have not received all the information and explanations we require for our audit.
## **Responsibilities of trustees**
As explained more fully in the trustees' responsibilities statement, the Trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Trustees are responsible for assessing the charitable company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.
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**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SWARTHMORE EDUCATION CENTRE (CONTINUED)**
## **Auditors' responsibilities for the audit of the financial statements**
We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.
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 auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
We obtained an understanding of the legal and regulatory frameworks within which the charitable company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006 together with the Charities SORP (FRS102) 2019 and the Education and Skills Funding Agency.
We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company's ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company for fraud. The laws and regulations we considered in this context were Charities Commission Regulations and Health and Safety and safeguarding considerations.
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.
We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be with regards to the timing of recognition of income and the override of controls by management.
Our audit procedures to respond to these risks included:
- enquiries of management and the Trustees about their own identification and assessment of the risks of irregularities,
- sample testing on the posting of journals,
- reviewing accounting estimates for biases,
- reviewing contracts and carrying out detailed substantive testing on the completeness of income,
- reading minutes of meetings of those charged with governance; and
- obtaining confirmation from the trustees that there was no regulatory correspondence with the Charity Commission or other regulatory bodies.
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 auditors' report.
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**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SWARTHMORE EDUCATION CENTRE (CONTINUED)**
## **Use of our report**
This report is made solely to the charitable company's trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charitable company's trustees those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and its members, as a body, for our audit work, for this report, or for the opinions we have formed.
## **Susan Seaman BA FCA CIOT (Senior Statutory Auditor)**
For and on behalf of Sagars Accountants Ltd Gresham House 5-7 St Pauls Street Leeds LS1 2JG
21 February 2023
Sagars Accountants Ltd are eligible to act as auditors in terms of section 1212 of the Companies Act 2006.
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## **SWARTHMORE EDUCATION CENTRE**
## **(A company limited by guarantee)**
## **STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 JULY 2022**
|**Note**
**Income from:**
Donations and legacies
4
Charitable activities
5
Other trading activities
6
Other income
7
**Total income**
**Expenditure on:**
Raising funds
Charitable activities
8
**Total expenditure**
**Net (expenditure)/income**
Transfers between funds
17
**Net movement in funds**
**Reconciliation of funds:**
Total funds brought forward
Net movement in funds
**Total funds carried forward**|**Unrestricted**
**funds**
**2022**
**£**
**6,720**
**1,499,602**
**80,333**
**3,125**
**1,589,780**
**74,440**
**1,626,594**
**1,701,034**
**(111,254)**
**6,064**
**(105,190)**
**1,411,027**
**(105,190)**
**1,305,837**|**Restricted**
**funds**
**2022**
**£**
**17,090**
**-**
**-**
**-**
**17,090**
**-**
**4,760**
**4,760**
**12,330**
**(6,064)**
**6,266**
**9,732**
**6,266**
**15,998**|**Total**
**funds**
**2022**
**£**
**23,810**
**1,499,602**
**80,333**
**3,125**
**1,606,870**
**74,440**
**1,631,354**
**1,705,794**
**(98,924)**
**-**
**(98,924)**
**1,420,759**
**(98,924)**
**1,321,835**|_Total_
_funds_
_2021_
_£_
_202,751_
_1,282,183_
_4,342_
_11,231_
_1,500,507_
_46,954_
_1,466,718_
_1,513,672_
_(13,165)_
_-_
_(13,165)_
_1,433,924_
_(13,165)_
_1,420,759_|
|---|---|---|---|---|
The Statement of financial activities includes all gains and losses recognised in the year.
The notes on pages 18 to 34 form part of these financial statements.
Page 15
## **SWARTHMORE EDUCATION CENTRE (A company limited by guarantee) REGISTERED NUMBER: 04527579**
## **BALANCE SHEET AS AT 31 JULY 2022**
|**Note**
**Fixed assets**
Tangible assets
13
**Current assets**
Debtors
14
Cash at bank and in hand
Creditors: amounts falling due within one
year
15
**Net current assets**
**Total assets less current liabilities**
Creditors: amounts falling due after more
than one year
16
**Net assets excluding pension asset**
**Total net assets**
**Charity funds**
Restricted funds
17
Unrestricted funds
17
**Total funds**|**240,301**
**163,744**
**404,045**
**(137,435)**|**2022**
**£**
**1,157,471**
**1,157,471**
**266,610**
**1,424,081**
**(102,246)**
**1,321,835**
**1,321,835**
**15,998**
**1,305,837**
**1,321,835**|_269,902_
_252,884_
_522,786_
_(170,739)_|_2021_
_£_
_1,193,584_
_1,193,584_
_352,047_
_1,545,631_
_(124,872)_
_1,420,759_
_1,420,759_
_9,732_
_1,411,027_
_1,420,759_|
|---|---|---|---|---|
The financial statements were approved and authorised for issue by the Trustees on 21 February 2023 and signed on their behalf by:
## **Ms K J Badon**
Trustee
The notes on pages 18 to 34 form part of these financial statements.
Page 16
## **SWARTHMORE EDUCATION CENTRE**
## **(A company limited by guarantee)**
## **STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 JULY 2022**
|**Note**
**Cash flows from operating activities**
Net cash used in operating activities
20
**Cash flows from investing activities**
Purchase of tangible fixed assets
**Net cash used in investing activities**
**Cash flows from financing activities**
Cash inflows from new borrowing
Repayments of borrowing
**Net cash (used in)/provided by financing activities**
**Change in cash and cash equivalents in the year**
Cash and cash equivalents at the beginning of the year
**Cash and cash equivalents at the end of the year**
21|**2022**
**£**
**(29,579)**
**(36,516)**
**(36,516)**
**-**
**(23,045)**
**(23,045)**
**(89,140)**
**252,884**
**163,744**|_2021_
_£_
_(41,750)_
_(101,456)_
**(101,456)**
_150,000_
_(1,900)_
**148,100**
**4,894**
_247,990_
_252,884_|
|---|---|---|
The notes on pages 18 to 34 form part of these financial statements
Page 17
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **1. General information**
The charity is a public benefit entity and a private company limited by guarantee, registered in England and Wales and a registered charity in England and Wales. The address of the registered office is Swarthmore Education Centre, 2/7 Woodhouse Square, Leeds, LS3 1AD.
## **2. Accounting policies**
## **2.1 Basis of preparation of financial statements**
The financial statements have been prepared in accordance with the Charities SORP (FRS 102) - Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.
Swarthmore Education Centre meets the definition of a public benefit entity under FRS 102.
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through income or expenditure.
The financial statements are prepared in sterling, which is the functional currency of the entity.
## **2.2 Going concern**
The directors consider the charitable company to be a going concern and the financial statements have been prepared on that basis. In coming to this conclusion, the directors have considered the residual impact of Covid-19, and the increasing pressures of the Cost of Living crisis, presenting significant increases in energy costs and desire to meet future wage demands. Although there is a financial impact to the organisation, management have taken steps to mitigate this by controlling costs or passing these on where it is unavoidable. A new 3-year business strategy currently under development will further strengthen Swarthmore’s financial position for the period ahead.
## **2.3 Judgements and key sources of estimation uncertainty**
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. Details of these judgements are set out in the accounting policies.
Page 18
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **2. Accounting policies (continued)**
## **2.4 Income**
All incoming resources are included in the statement of financial activities when entitlement has passed to the charity; it is probable that the economic benefits associated with the transaction will flow to the charity and the amount can be reliably measured. The following specific policies are applied to particular categories of income:
• income from donations or grants is recognised when there is evidence of entitlement to the gift, receipt is probable and its amount can be measured reliably.
• legacy income is recognised when receipt is probable and entitlement is established.
• income from donated goods is measured at the fair value of the goods unless this is impractical to measure reliably, in which case the value is derived from the cost to the donor or the estimated resale value. Donated facilities and services are recognised in the accounts when received if the value can be reliably measured. No amounts are included for the contribution of general volunteers.
• income from contracts for the supply of services is recognised with the delivery of the contracted service. This is classified as unrestricted funds unless there is a contractual requirement for it to be spent on a particular purpose and returned if unspent, in which case it may be regarded as restricted.
## **2.5 Expenditure**
Expenditure is recognised on an accruals basis as a liability is incurred. Expenditure includes any VAT which cannot be fully recovered, and is classified under headings of the statement of financial activities to which it relates:
• expenditure on raising funds includes the costs of all fundraising activities, events, non-charitable trading activities, and the sale of donated goods.
• expenditure on charitable activities includes all costs incurred by a charity in undertaking activities that further its charitable aims for the benefit of its beneficiaries, including those support costs and costs relating to the governance of the charity apportioned to charitable activities.
• other expenditure includes all expenditure that is neither related to raising funds for the charity nor part of its expenditure on charitable activities.
All costs are allocated to expenditure categories reflecting the use of the resource. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs are apportioned between the activities they contribute to on a reasonable, justifiable and consistent basis.
Page 19
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **2. Accounting policies (continued)**
## **2.6 Government grants**
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received.
Where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
## **2.7 Tangible fixed assets and depreciation**
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
In accordance with SORP 2000 the Management Committee capitalised freehold land and buildings at 2-5 Woodhouse Square, Leeds gifted on 1 April 2003 at their estimated value to the centre of £1,100,000. Subsequently, there has been £267,482 of improvements to the property.
An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other recognised gains and losses, unless it reverses a charge for impairment that has previously been recognised as expenditure within the statement of financial activities. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other recognised gains and losses, except to which it offsets any previous revaluation gain, in which case the loss is shown within other recognised gains and losses on the statement of financial activities.
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.
For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.
Depreciation is charged so as to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives .
Depreciation is provided on the following bases:
- Freehold property 2% Straight line - Leasehold property Remaining life of the lease - Fixtures and fittings 25% Straight line/ 15% Reducing balance
Page 20
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **2. Accounting policies (continued)**
## **2.8 Financial instruments**
A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument.
Basic financial instruments are initially recognised at the amount receivable or payable including any related transaction costs, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.
Current assets and current liabilities are subsequently measured at the cash or other consideration expected to be paid or received and not discounted.
## **2.9 Operating leases**
Rentals paid under operating leases are charged to the statement of financial activities on a straightline basis over the lease term.
## **2.10 Pensions**
The company operates a defined contribution pension scheme and the pension charge represents the amounts payable by the company to the fund in respect of the year.
## **2.11 Fund accounting**
Unrestricted funds are available for use at the discretion of the trustees to further any of the charity's purposes.
Designated funds are unrestricted funds earmarked by the trustees for particular future project or commitment.
Restricted funds are subjected to restrictions on their expenditure declared by the donor or through the terms of an appeal, and fall into one of two sub-classes: restricted income funds or endowment funds.
## **3. Limited by guarantee**
The company is limited by guarantee to the value of £1 per member on winding up.
Page 21
**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **4. Income from donations and legacies**
|**Unrestricted**
**funds**
**2022**
**£**
Donations
5,251
Grants
-
Government Coronavirus Job Retention Scheme grant
1,469
6,720
_Unrestricted_
_funds_
_2021_
_£_
Donations
_3,741_
Grants
_-_
Government Coronavirus Job Retention Scheme grant
_126,124_
_129,865_|**Restricted**
**funds**
**2022**
**£**
-
17,090
-
17,090
_Restricted_
_funds_
_2021_
_£_
_13,800_
_59,086_
_-_
_72,886_|**Total**
**funds**
**2022**
**£**
**5,251**
**17,090**
**1,469**
**23,810**|
|---|---|---|
|||_Total_
_funds_
_2021_
_£_
_17,541_
_59,086_
_126,124_
_202,751_|
## **5. Income from charitable activities**
|**Unrestricted**
**funds**
**2022**
**£**
Leeds City Council Adult Learning
254,629
Leeds City Council Additional Learning Support
189,171
Other grants
11,764
Student fees
126,907
Membership fees
6,938
Sale of education materials
3,743
Tutoring services provided to community
23,477
Education Funding Agency
882,973
1,499,602|**Total**
**funds**
**2022**
**£**
**254,629**
**189,171**
**11,764**
**126,907**
**6,938**
**3,743**
**23,477**
**882,973**
**1,499,602**|
|---|---|
Page 22
**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **5. Income from charitable activities (continued)**
|Leeds City Council Adult Learning
Leeds City Council Additional learning support
Other Grants
Student fees
Membership fees
Sale of educational materials
Contract income
Education Funding Agency|_Unrestricted_
_funds_
_2021_
_£_
_277,292_
_149,910_
_27,956_
_226_
_6,153_
_148_
_3,096_
_817,402_
_1,282,183_|_Total_
_funds_
_2021_
_£_
_277,292_
_149,910_
_27,956_
_226_
_6,153_
_148_
_3,096_
_817,402_
_1,282,183_|
|---|---|---|
## **6. Income from other trading activities**
## **Income from non charitable trading activities**
|**Unrestricted**
**funds**
**2022**
**£**
Cafe income
29,375
Rental income
50,958
80,333
_Unrestricted_
_funds_
_2021_
_£_
Cafe income
_4,588_
Rental income
_(246)_
_4,342_|**Total**
**funds**
**2022**
**£**
**29,375**
**50,958**
**80,333**|
|---|---|
||_Total_
_funds_
_2021_
_£_
_4,588_
_(246)_
_4,342_|
Page 23
## **SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **7. Other incoming resources**
|Miscellaneous income
Miscellaneous income|**Unrestricted**
**funds**
**2022**
**£**
3,125
_Unrestricted_
_funds_
_2021_
_£_
_11,231_|**Total**
**funds**
**2022**
**£**
**3,125**|
|---|---|---|
|||_Total_
_funds_
_2021_
_£_
_11,231_|
## **8. Analysis of expenditure on charitable activities**
## **Summary by fund type**
|**Unrestricted**
**funds**
**2022**
**£**
Courses
1,203,108
Governance costs
69,670
Support costs
353,816
1,626,594|**Restricted**
**funds**
**2022**
**£**
4,294
-
466
4,760|**Total**
**funds**
**2022**
**£**
**1,207,402**
**69,670**
**354,282**
**1,631,354**|
|---|---|---|
Page 24
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **8. Analysis of expenditure on charitable activities (continued)**
## **Summary by fund type (continued)**
|Courses
Creche
Governance costs
Support costs|_Unrestricted_
_funds_
_2021_
_£_
_1,041,604_
_18,039_
_55,711_
_306,070_
_1,421,424_|_Restricted_
_funds_
_2021_
_£_
_39,026_
_-_
_-_
_6,268_
_45,294_|_Total_
_funds_
_2021_
_£_
_1,080,630_
_18,039_
_55,711_
_312,338_
_1,466,718_|
|---|---|---|---|
## **9. Analysis of expenditure by activities**
|Courses
Governance costs
Support costs
Courses
Creche
Governance costs
Support costs|**Activities**
**undertaken**
**directly**
**2022**
**£**
1,207,402
-
-
1,207,402
_Activities_
_undertaken_
_directly_
_2021_
_£_
_1,080,630_
_18,039_
_-_
_-_
_1,098,669_|**Support**
**costs**
**2022**
**£**
-
69,669
354,282
423,951
_Support_
_costs_
_2021_
_£_
_-_
_-_
_55,711_
_312,338_
_368,049_|**Total**
**funds**
**2022**
**£**
**1,207,402**
**69,669**
**354,282**
**1,631,354**|
|---|---|---|---|
||||_Total_
_funds_
_2021_
_£_
_1,080,630_
_18,039_
_55,711_
_312,338_
_1,466,718_|
Page 25
**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **9. Analysis of expenditure by activities (continued)**
## **Analysis of support costs**
|Staff costs
Depreciation
Premises
Communications and IT
General office
Legal and professional fees
Governance costs
Staff costs
Depreciation
Premises
Communication and IT
General office
Legal and professional fees
Governance costs|**Courses**
**2022**
**£**
-
-
-
-
-
-
69,669
69,669
_Courses_
_2021_
_£_
_-_
_-_
_-_
_-_
_-_
_-_
_55,711_
_55,711_|**Governance**
**2022**
**£**
143,440
72,629
112,783
11,068
12,550
1,812
-
354,282
_Governance_
_2021_
_£_
_133,917_
_62,750_
_81,198_
_10,320_
_21,701_
_2,452_
_-_
_312,338_|**Total**
**funds**
**2022**
**£**
**143,440**
**72,629**
**112,783**
**11,068**
**12,550**
**1,812**
**69,669**
**423,951**|
|---|---|---|---|
||||_Total_
_funds_
_2021_
_£_
_133,917_
_62,750_
_81,198_
_10,320_
_21,701_
_2,452_
_55,711_
_368,049_|
Page 26
**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **10. Auditors' remuneration**
||**2022**|_2021_|
|---|---|---|
||**£**|_£_|
|Fees payable to the company's auditor for the audit of the company's|||
|annual accounts|**9,500**|_6,400_|
## **11. Staff costs**
|Wages and salaries
Social security costs
Other pension costs|**2022**
**£**
**1,172,360**
**91,348**
**28,557**
**1,292,265**|_2021_
_£_
_1,085,723_
_77,241_
_29,148_|
|---|---|---|
|||_1,192,112_|
Included within staff costs are statutory redundancy, termination and settlement payments made during the year totalling £23,936 (2021 - £18,938).
The average head count of employees during the year was 77 (2021: 74).
The average number of full-time equivalent employees during the year is analysed as follow:
||**2022**|_2021_|
|---|---|---|
||**No.**|_No._|
|Number of staff|**45**|_45_|
No employee received remuneration amounting to more than £60,000 in either year.
Key management personnel include all persons that have authority and responsibility for planning, directing and controlling the activities of the charity. The total compensation paid to key management personnel for services provided to the charity was £214,992 (2021: £247,261).
## **12. Trustees' remuneration and expenses**
During the year, no Trustees received any remuneration or other benefits _(2021 - £NIL)_ .
During the year ended 31 July 2022, Trustee travel expenses totalling £21 have been incurred _(2021 - £ NIL)_ .
Page 27
**(A company limited by guarantee)**
## **SWARTHMORE EDUCATION CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **13. Tangible fixed assets**
|**Cost or valuation**
At 1 August 2021
Additions
At 31 July 2022
**Depreciation**
At 1 August 2021
Charge for the year
At 31 July 2022
**Net book value**
At 31 July 2022
_At 31 July 2021_
**Debtors**
**Due within one year**
Trade debtors
Other debtors
Prepayments and accrued income|**Freehold**
**property**
**£**
**1,367,482**
**-**
**1,367,482**
**451,659**
**27,350**
**479,009**
**888,473**
_915,823_|**Long-term**
**leasehold**
**property**
**£**
**188,136**
**-**
**188,136**
**36,143**
**5,124**
**41,267**
**146,869**
_151,993_|**Fixtures and**
**fittings**
**£**
**603,594**
**36,516**
**640,110**
**477,826**
**40,155**
**517,981**
**122,129**
_125,768_
**2022**
**£**
**18,971**
**2,571**
**218,759**
**240,301**|**Total**
**£**
**2,159,212**
**36,516**
**2,195,728**|
|---|---|---|---|---|
|||||**965,628**
**72,629**
**1,038,257**|
|||||**1,157,471**|
|||||_1,193,584_|
|||||_2021_
_£_
_2,180_
_2,117_
_265,605_
_269,902_|
## **14. Debtors**
Page 28
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **15. Creditors: Amounts falling due within one year**
|Bank loans
Trade creditors
Other taxation and social security
Other creditors
Accruals and deferred income|**2022**
**£**
**22,808**
**38,204**
**21,126**
**3,562**
**51,735**
**137,435**|_2021_
_£_
_23,228_
_71,271_
_14,319_
_8,261_
_53,660_|
|---|---|---|
|||_170,739_|
The bank loan included in creditors falling due in less than one year is secured by the company. The security is by a fixed and floating charge over all assets and undertakings of the company.
|Deferred income at 1 August 2021
Resources deferred during the year
Amounts released from previous periods|**2022**
**£**
**19,797**
**24,109**
**(19,797)**
**24,109**|_2021_
_£_
_4,496_
_19,797_
_(4,496_|
|---|---|---|
|||_19,797_|
Deferred income relates to course fees, membership fees and room bookings paid in advance.
## **16. Creditors: Amounts falling due after more than one year**
||**2022**|_2021_|
|---|---|---|
||**£**|_£_|
|Bank loans|**102,246**|_124,872_|
Included within creditors: amounts falling due after more than one year is an amount of £nil (2021: £25,520) in respect of liabilities payable or repayable by instalments which fall due for payment after more than five years from the reporting date.
The bank loan included in creditors falling due in after more than one year is secured by the company. The security is by a fixed and floating charge over all assets and undertakings of the company.
Page 29
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **17. Statement of funds**
## **Statement of funds - current year**
||**Balance at 1**|**Balance at 1**||||||**Transfers**|**Transfers**||**Balance at**|
|---|---|---|---|---|---|---|---|---|---|---|---|
||**August 2021**||**Income**||**Expenditure**|||**in/out**||**31 July 2022**||
||**£**||**£**|||**£**||**£**|||**£**|
|**Unrestricted funds**||||||||||||
|Unrestricted Income fund|**343,212**||**1,589,780**|||**(1,668,560)**||**6,064**|||**270,496**|
|Unrestricted Property fund|**1,067,815**||**-**|||**(32,474)**||**-**|||**1,035,341**|
||**1,411,027**||**1,589,780**|||**(1,701,034)**||**6,064**|||**1,305,837**|
|The unrestricted property fund|represents monies held in freehold and leasehold property at|||||||||the year end||
||**Balance at 1**|||||||**Transfers**|||**Balance at**|
||**August 2021**||**Income**||**Expenditure**|||**in/out**||**31 July 2022**||
||**£**||**£**|||**£**||**£**|||**£**|
|**Restricted funds**||||||||||||
|UK Online|**9,268**||**-**|||**-**||**-**|||**9,268**|
|National Lottery grant|**464**||**-**|||**(464)**||**-**|||**-**|
|Adidas project|**-**||**1,606**|||**(220)**||**-**|||**1,386**|
|Community grant - Art at the||||||||||||
|Heart|**-**||**15,484**|||**(4,076)**||**(6,064)**|||**5,344**|
||**9,732**||**17,090**|||**(4,760)**||**(6,064)**|||**15,998**|
||**Balance at 1**|||||||**Transfers**|||**Balance at**|
||**August 2021**||**Income**||**Expenditure**|||**in/out**||**31 July 2022**||
||**£**||**£**|||**£**||**£**|||**£**|
|**Total of funds**|**1,420,759**||**1,606,870**|||**(1,705,794)**||**-**|||**1,321,835**|
|||||||||||||
The unrestricted property fund represents monies held in freehold and leasehold property at the year end.
UK Online is a grant from the Tinder Foundation to support specific programmes of digital inclusion activity.
National Lottery funding relates to grants received to help with the impact of the Covid-19 pandemic on the ability to provide learning to students.
Adidas Project relates to promoting inclusion of females in sport.
Community Grant - Art at the heart relates to community art based project for refugees.
The transfer of £6,064 between the restricted and unrestricted fund relates to the purchase of Chromebooks in the year for the Community Grant - Art for the heart.
Page 30
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **17. Statement of funds (continued)**
## **Statement of funds - prior year**
|**Unrestricted funds**
Unrestricted Income fund
Unrestricted Property fund
**Restricted funds**
UK Online
Leeds City Council Adult
Learning funding
Supply of Chromebooks from
DfE
National Lottery grant
**Total of funds**|_Balance at_
_1 August_
_2020_
_£_
_352,469_
_1,068,165_
_1,420,634_
_Balance at_
_1 August_
_2020_
_£_
_9,268_
_4,022_
_-_
_-_
_13,290_
_Balance at_
_1 August_
_2020_
_£_
_1,433,924_|_Income_
_£_
_1,427,621_
_-_
_1,427,621_
_Income_
_£_
_-_
_-_
_13,800_
_59,086_
_72,886_
_Income_
_£_
_1,500,507_|_Expenditure_
_£_
_(1,435,843)_
_(32,535)_
_(1,468,378)_
_Expenditure_
_£_
_-_
_(4,022)_
_-_
_(41,272)_
_(45,294)_
_Expenditure_
_£_
_(1,513,672)_|_Transfers_
_in/out_
_£_
_(1,035)_
_32,185_
_31,150_
_Transfers_
_in/out_
_£_
_-_
_-_
_(13,800)_
_(17,350)_
_(31,150)_
_Transfers_
_in/out_
_£_
_-_|_Balance at_
_31 July 2021_
_£_
_343,212_
_1,067,815_
_1,411,027_|
|---|---|---|---|---|---|
||||||_Balance at_
_31 July 2021_
_£_
_9,268_
_-_
_-_
_464_
_9,732_|
||||||_Balance at_
_31 July 2021_
_£_
_1,420,759_|
Page 31
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **18. Summary of funds**
## **Summary of funds - current year**
|**Balance at 1**
**August 2021**
**£**
General funds
**1,411,027**
Restricted funds
**9,732**
**1,420,759**
**Summary of funds - prior year**
_Balance at_
_1 August_
_2020_
_£_
General funds
_1,420,634_
Restricted funds
_13,290_
_1,433,924_|**Income**
**£**
**1,589,780**
**17,090**
**1,606,870**
_Income_
_£_
_1,427,621_
_72,886_
_1,500,507_|**Expenditure**
**£**
**(1,701,034)**
**(4,760)**
**(1,705,794)**
_Expenditure_
_£_
_(1,468,378)_
_(45,294)_
_(1,513,672)_|**Transfers**
**in/out**
**£**
**Balance at**
**31 July 2022**
**£**
**6,064**
**1,305,837**
**(6,064)**
**15,998**
**-**
**1,321,835**
_Transfers_
_in/out_
_£_
_Balance at_
_31 July 2021_
_£_
_31,150_
_1,411,027_
_(31,150)_
_9,732_
_-_
_1,420,759_|**Transfers**
**in/out**
**£**
**Balance at**
**31 July 2022**
**£**
**6,064**
**1,305,837**
**(6,064)**
**15,998**
**-**
**1,321,835**
_Transfers_
_in/out_
_£_
_Balance at_
_31 July 2021_
_£_
_31,150_
_1,411,027_
_(31,150)_
_9,732_
_-_
_1,420,759_|
|---|---|---|---|---|
|||||_Balance at_
_31 July 2021_
_£_
_1,411,027_
_9,732_
_1,420,759_|
|**Summary of funds - prior year**|||||
|General funds
Restricted funds|||||
## **19. Analysis of net assets between funds**
**Analysis of net assets between funds - current year**
|**Unrestricted**
**funds**
**2022**
**£**
Tangible fixed assets
1,157,471
Current assets
388,047
Creditors due within one year
(137,435)
Creditors due in more than one year
(102,246)
**Total**
1,305,837|**Restricted**
**funds**
**2022**
**£**
-
15,998
-
-
15,998|**Total**
**funds**
**2022**
**£**
**1,157,471**
**404,045**
**(137,435)**
**(102,246)**
**1,321,835**|
|---|---|---|
Page 32
**SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **19. Analysis of net assets between funds (continued)**
## **Analysis of net assets between funds - prior year**
|_Unrestricted_
_funds_
_2021_
_Restricted_
_funds_
_2021_
_£_
_£_
Tangible fixed assets
_1,193,584_
_-_
Current assets
_513,054_
_9,732_
Creditors due within one year
_(170,739)_
_-_
Creditors due in more than one year
_(124,872)_
_-_
**Total**
_1,411,027_
_9,732_
**20.**
**Reconciliation of net movement in funds to net cash flow from operating activities**
**2022**
**£**
Net expenditure for the year (as per Statement of Financial Activities)
**(98,924)**
**Adjustments for:**
Depreciation charges
**72,629**
Decrease/(increase) in debtors
**29,601**
Increase/(decrease) in creditors
**(32,885)**
**Net cash used in operating activities**
**(29,579)**
**21.**
**Analysis of cash and cash equivalents**
**2022**
**£**
Cash in hand
**163,744**
**Total cash and cash equivalents**
**163,744**|_Total_
_funds_
_2021_
_£_
_1,193,584_
_522,786_
_(170,739)_
_(124,872)_
_1,420,759_
_2021_
_£_
_(13,165)_
_62,750_
_(110,839)_
_19,504_
_(41,750)_
_2021_
_£_
_252,884_
_252,884_|
|---|---|
Page 33
## **SWARTHMORE EDUCATION CENTRE (A company limited by guarantee)**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2022**
## **22. Analysis of changes in net debt**
|Cash at bank and in hand
Debt due within 1 year
Debt due after 1 year|**At 1 August**
**2021**
**£**
**252,884**
**(23,228)**
**(124,872)**
**104,784**|**Cash flows**
**£**
**(89,140)**
**420**
**22,626**
**(66,094)**|**At 31 July**
**2022**
**£**
**163,744**
**(22,808)**
**(102,246)**
**38,690**|
|---|---|---|---|
## **23. Operating lease commitments**
At 31 July 2022 the company had commitments to make future minimum lease payments under noncancellable operating leases as follows:
|Not later than 1 year
Later than 1 year and not later than 5 years|**2022**
**£**
**5,695**
**-**
**5,695**|_2021_
_£_
_-_
_16,682_|
|---|---|---|
|||_16,682_|
Page 34
Company name: Swarthmore Education Centre Registered office: 2/7 Woodhouse Square, Leeds LS3 1AD Company number: 4527579 (registered in England and Wales)
Charitable Company Trustees: N Zaman, K Badon, S Sinha, I Greenwood, Dr E Watkins, Ms C L Walker, S L Taylor and L R Huxley.
21 February 2023
**Sagars Accountants Ltd Chartered Accountants Gresham House 5-7 St Pauls Street Leeds LS1 2JG**
Dear Sirs
**Swarthmore Education Centre Accounts for the year ended 31 July 2022**
We provide this letter in connection with your audit of the financial statements of Swarthmore Education Centre for the year ended 31 July 2022 for the purpose of expressing an opinion as to whether the financial statements give a true and fair view of the financial position of the charity as at 31 July 2022 and of the results of its operations for the year then ended in accordance with UK Generally Accepted Accounting Practice (“UK GAAP”).
We confirm that the following representations are made on the basis of sufficient enquiries of management and staff with relevant knowledge and experience and, where appropriate, of inspection of supporting documentation and that, to the best of our knowledge and belief, we can properly make each of these representations to you.
1. We have fulfilled our responsibility for the fair presentation of the financial statements in accordance with UK GAAP.
2. We acknowledge as trustees our responsibility for making accurate representations to you.
3. We acknowledge our responsibility for the design and implementation of internal control to prevent and detect fraud and errors.
4. We confirm that we have received confirmation from each director who was a director at the time of the approval of the financial statements that:
- a. they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that you are aware of that information and
- b. that so far as they are aware there is no relevant audit information of which you are unaware.
5. We have provided you with all accounting records and relevant information, and granted you unrestricted access to persons within the entity, for the purposes of your audit.
6. All the transactions undertaken by the charity have been properly reflected and recorded in the accounting records or other information provided to you.
7. In respect of accounting estimates and judgements, we confirm our belief that the significant assumptions used are reasonable.
Company name: Swarthmore Education Centre Registered office: 2/7 Woodhouse Square, Leeds LS3 1AD Company number: 4527579 (registered in England and Wales)
Charitable Company Trustees: N Zaman, K Badon, S Sinha, I Greenwood, Dr E Watkins, Ms C L Walker, S L Taylor and L R Huxley.
8. We have considered the adjustments in Appendix 1, proposed by you. In our judgement, these adjustments are appropriate given the information available to us. We further confirm that we have now made these adjustments to the financial statements.
9. We do not wish to adjust the financial statements for the actual errors set out in Appendix 2 as we believe that the errors are immaterial, both individually and in aggregate, to the financial statements as a whole.
10. We are not aware of any actual or possible litigation or claims against the company whose effects should be considered when preparing the financial statements
11. All grants, donations and other incoming resources, the receipt of which is subject to specific terms and conditions, have been notified to you. There have been no breaches of terms or conditions in the application of such incoming resources.
12. We can confirm there has been no clawback of income in the year.
13. We are not aware of any breaches of our charitable trusts and have advised you of the existence of all endowments and funds maintained by us.
14. There have been no events since the balance sheet date which require disclosure or which would materially affect the amounts in the financial statements. Should any material events occur which may necessitate revision of the figures in the financial statements, or inclusion in a note thereto, we will advise you accordingly.
15. We have assessed that there is no significant risk that the financial statements are materially misstated as a result of fraud.
16. We are not aware of any fraud or suspected fraud affecting the charity involving those charged with governance, management or other employees who have a significant role in internal control or who could have a material effect on the financial statements.
17. We are not aware of any allegations by employees, former employees, regulators or others of fraud, or suspected fraud, which would have an impact on the charity’s financial statements.
18. We are not aware of any known or suspected instances of non-compliance with those laws and regulations which provide a legal framework within which the charity conducts its business.
19. We confirm that complete information has been provided to you regarding the identification of related parties and that we are not aware of any significant transactions with related parties.
20. We confirm we have appropriately accounted for and disclosed related party relationships and transactions in accordance with applicable accounting standards and with the recommendations of the applicable charity SORP.
21. We confirm that, having considered our expectations and intentions for the next twelve months and the availability of working capital, the Charitable company is a going concern. We are unaware of any events, conditions, or related business risks beyond the period of assessment that may cast significant doubt on the Charitable company’s ability to continue as a going concern.
Company name: Swarthmore Education Centre Registered office: 2/7 Woodhouse Square, Leeds LS3 1AD Company number: 4527579 (registered in England and Wales)
Charitable Company Trustees: N Zaman, K Badon, S Sinha, I Greenwood, Dr E Watkins, Ms C L Walker, S L Taylor and L R Huxley.
22. We have no plans or intentions that may materially alter the carrying value or classification of assets and liabilities reflected in the financial statements.
23. We confirm that the restricted funds as disclosed in note 22 to the financial statements are complete and that no restrictions have been placed on any other income streams received during the year.
Yours faithfully,
………………….
Trustee
Signed on behalf of Swarthmore Education Centre
21-Feb-2023 On ………………….
## **Appendix 1 - Summary of adjustments made to the accounts during the audit**
|**ppendix 1 - Summary of adjustments made to the accounts during the audit**||
|---|---|
|Profit/(Loss) per client accounts
Client late adjustments
Air purifiers not capitalised
Growth Company grant income not posted
Reallocation of restricted income from unrestricted income (£17,090)
Reallocation of restricted expenditure from unrestricted expenditure (£10,144)
Profit/(Loss) per final audited accounts|**£**
(111,020)
(1,442)
7,634
5,906
-
-|
||(98,922)|
## **Appendix 2 - Summary of uncorrected misstatements in the accounts**
NB Some of the “errors” shown below are test differences only. This means that they are not actual errors but are judgements made during audit tests of the maximum potential errors within populations tested. These judgements are reached to avoid us doing any further testing in those areas and there is no suggestion that adjustments to the financial statements should be made for these differences.
|**Nature of Error**
Debit balances on trade creditors ledger
due to overpayments (£2,639)
Under provision of employee claim
Post year end invoices not accrued for
(extrapolated error)
Total effect on profit|**Monetary**
**Amount**
**£**
**Areas**
**Misstated**
**Reasons for not correcting**
-
Debtors and
creditors
Immaterial
(2,500)
Expenditure and
creditors
Immaterial
(9,656)
Expenditure and
creditors
Immaterial
(12,156)|
|---|---|
The above list does not include those misstatements regarded as trivial.