## **Ark UK Programmes**
## **Annual Report and Financial Statements**
31 August 2022
Company limited by guarantee registration number 05932797 (England and Wales)
Charity registration number 1137932
**Ark UK Programmes Contents**
|**Reports**||
|---|---|
|Reference and administrative details|1|
|Trustees’ report|2|
|Independent auditor’s report|10|
|**Financial Statements**||
|Statement of financial activities|15|
|Balance sheet|17|
|Statement of cash flows|18|
|Notes to the financial statements|20|
|**Ark UK Programmes**||
|---|---|
|**Reference and administrative details**||
|**Trustees**|Michael Clark|
||Lord Fink|
||Lucy Heller|
|**Company Secretary**|Elizabeth Dawson|
|**Chief Executive**|Lucy Heller|
|**Registered Office**|The Yellow Building|
||1, Nicholas Road|
||London|
||W11 4AN|
|**Company registration number**|05932797|
|**Charity registration number**|1137932|
|**Auditor**|Buzzacott LLP|
||130 Wood Street|
||London|
||EC2V 6DL|
|**Bankers**|Lloyds Bank plc|
||95 George Street|
||Croydon|
||CR9 2NS|
|**Solicitor**|Stone King LLP|
||Boundary House|
||91 Charterhouse Street|
||London|
||EC1M 6HR|
|**Investment manager**|JP Morgan International Bank|
||25 Bank Street|
||Canary Wharf|
||London|
||E14 5JP|
1
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
The trustees, who are also directors of Ark UK Programmes for the purposes of the Companies Act, are pleased to present their report together with the audited financial statements for the year ended 31 August 2022.
The financial statements have been prepared in accordance with the accounting policies set out on pages 20 to 24 of the attached financial statements and comply with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable to the United Kingdom and Republic of Ireland (FRS 102).
## **Objectives and principal activities**
Ark UK Programmes has the principal objective of advancing the education of the public. It provides a home to mission-aligned organisations, helping them to grow into sustainable entities, often resulting in them becoming independent organisations. In 2021/22, the charity continued to incubate three Ark ventures: Ark Curriculum+ (AC+), Ark Start, and MESME. The contribution made by these ventures to achieve the objectives of Ark UK Programmes is described from page 4.
## **Organisation**
Ark UK Programmes is a company limited by guarantee (Company No. 05932797) and a registered charity in England and Wales (Charity No. 1137932). The charity is governed by its Memorandum and Articles of Association. It is a fully owned subsidiary of Absolute Return for Kids (ARK) (referred to throughout as ‘Ark’, charity registration number 1095322, company registration number 04589451), a charity established to improve the life chances of children, which runs projects around the world. One of the directors of Ark UK Programmes is also a director of Ark. The Chief Executive and Deputy Chief Executive of Ark UK Programmes are also the Chief Executive and Deputy Chief Executive of Ark.
In furtherance of its objects, Ark UK Programmes works closely with Ark Schools, a network of 39 schools. Lord Fink and Lucy Heller are also directors of Ark Schools.
The board of trustees, which can have up to ten members, administers the company. The activities of the charity, as determined by the board of trustees, are carried out under the direction of the Chief Executive.
## **Trustees**
The trustees are also directors of Ark UK Programmes for the purposes of company law.
The following individuals served as directors during the financial year and up to the date these financial statements were approved:
Michael Clark Lord Fink Lucy Heller
All directors served for the full year. Lord Fink did not have any beneficial interest in the organisation, nor did he receive any remuneration during the period. Lucy Heller and Michael Clark received remuneration from Ark for their respective roles as Chief Executive and Deputy Chief Executive (see note 8).
2
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Trustees** (continued)
New trustees may be appointed either by the board or by means of an ordinary resolution of the charity. On agreeing to become a trustee of the charitable company, the trustees are briefed by their co-directors on the history of the charitable company, day-to-day management, the responsibilities of trustees, current objectives, and future plans. The trustees are also encouraged to attend any courses relevant to their role, and to keep up to date with changes in legislation.
## **Key management personnel**
The trustees consider the board of trustees, and the senior management team to comprise the key management personnel of the charity in charge of directing and controlling, running, and operating the charity on a day-to-day basis. The Chief Executive and Deputy Chief Executive make up the senior management team and are remunerated by Ark.
Ark UK Programmes' key management salaries are set on appointment and reviewed annually in accordance with the pay review procedures operated by the parent organisation, Ark. The Deputy Chief Executive of Ark approves all salaries on appointment and any base salary in excess of £75,000 per annum is also approved by the Chief Executive of Ark. Annual reviews are subject to the same approval.
## **Risk management**
Ark UK Programmes’ management and trustees have reviewed and assessed the major risks to which the charity is exposed, and systems have been established to identify and manage those risks. Business plans for new ventures address the risks and mitigations and steering groups or shadow boards have been set up for the individual ventures. In addition, the Ark Finance and Risk Committee (FRC) formally reviews the Risk Register.
The key risks identified to date and mitigations are as follows:
- Additional competitive pressures, particularly for AC+, including the conversion of Oak National Academy into a new national curriculum body. To mitigate the risk of this, a full strategy review is underway including a review of programme design.
- The aftermath of the Covid-19 pandemic continues to put pressure on schools making it more difficult to sell the charity’s new and existing products. To mitigate the risk of this, we have fundraised to secure support for Ventures should income targets be missed.
- Over-reliance on individual funders. To mitigate this risk, programme commitments are limited to available funds and pledges. The pipeline of potential funders is in continuous development.
- Ventures fail to deliver target results. Venture strategies and reviews include venture board oversight, with input from board members with appropriate expertise. Monitoring includes programme redesign if needed.
- Ark Start fails to deliver impact within existing finances due to delayed start up and lack of political focus. To mitigate this risk, communication with funders and stakeholders is continuing. This is combined with an increased focus on impact measurement and evaluation.
3
**Ark UK Programmes**
## **Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Risk management** (continued)
- The effect of increasing costs, as a result of inflation, especially in staffing. Salary budgets are reviewed and controlled as part of the annual budget setting process. Any in year increases in salaries or new positions are subject to strict review and approval processes.
- Loss of key staff. Teams have been strengthened through the development of recruitment and retention strategies, including succession plans.
- Safeguarding incident involving Ark Start. Safeguarding policies and procedures are in place, including a full programme of training for nursery staff.
## **Achievements and performance**
## _**Ark Curriculum Plus**_
Ark Curriculum Plus (AC+) was formed in 2019 following the merger of Mathematics Mastery, a venture since 2012, and English Mastery, a venture since 2017, and has since launched new programmes in Science, History, and Geography.
AC+ partners with schools to create high quality curricula that empower teachers to ensure that every child has the subject knowledge to succeed. It provides researchbased and coherent curricula, teaching resources, and pedagogical training and support for teachers to help improve the quality of curriculum design and delivery. The AC+ curriculum programmes are having the greatest impact in schools with a high proportion of inexperienced teachers, helping them reach proficiency as quickly as possible.
## _Achievements and performance:_
- The number of programmes in use rose from 750 to 1,000 in 2021/22, driven by the launch of new programmes (including key stage 3 science and primary programmes).
- Funding was gained to develop two new programmes (key stage 4 Maths and Science) and to help scale the Maths Mastery Primary programme.
- AC+’s existing programmes did not grow as fast as planned due to: (a) uncertainty around the future of the Government-funded Oak National Academy’s free, online resources; and (b) the significant challenge on schools as they sought to find a post-pandemic equilibrium addressing drops in attendance and other significant problems leading to a deprioritisation on curriculum.
## _**Ark Start**_
Ark Start was founded to transform early education for disadvantaged children. It provides high-quality, teacher-led early education with a focus on working with parents to improve the home learning environment for pre-school children.
Ark Start is creating a new model of flexible, affordable nursery education and aims to create an exemplar group of nurseries that will accelerate outcomes for the most disadvantaged children and transform the funding of early years so that the pupils who need the most support attract the most funding.
4
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Achievements and performance** (continued)
_**Ark Start** (continued)_
_Achievements and performance:_
- Ark Start continued to fill the two open nurseries (Ark Start John Archer in Clapham Junction and Ark Start Oval in East Croydon).
- Ark Start developed a growing coalition of partners advocating for increased funding in disadvantaged areas.
- Given the early success and the need to maximise impact on policy makers, Ark Start is pursuing plans to expand to eight nurseries to strengthen its proof of concept.
## _**Mathematics Education for Social Mobility and Excellence (MESME)**_
Mathematics Education for Social Mobility and Excellence (MESME) exists to support students from all backgrounds to achieve mathematical excellence, so that they go on to have a greater and richer range of future personal, employment, and economic choices. It has developed and launched Maths Circles across the country for students aged 11-16. A Maths Circle is a group of students who come together to be mathematicians collectively. In Maths Circles, students grapple with intriguing questions, discover and explore exciting ideas, and learn to think like mathematicians.
Maths Circles aim to develop students’ mathematical thinking and expand their mathematical curiosity. They are out-of-class maths clubs featuring a ratio of at least one mentor for every six students. Sessions include a mixture of group and independent work and aim to engage students as they follow a carefully sequenced and structured curriculum.
## _Achievements and performance:_
- MESME completed a year-long pilot of the Maths Circles programme in collaboration with Ark Schools and 10 partner schools and organisations.
- During the pilot, 1,806 young people took part in Maths Circles, including 37 secondary students from eight Ark Schools. Of the total, 44 percent of participants were eligible for Pupil Premium.
- Feedback from students was overwhelmingly positive across enjoyment, engagement, and building confidence.
- MESME became an independent charity on 1 September 2022 (Charity No. 1199281) with charitable objectives to grow the impact of Maths Circles and similar programmes.
5
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Future plans**
## _**Ark Curriculum Plus**_
Ark Curriculum Plus’s priorities for 2022/23 are:
- To increase the number of programmes being used to more than 1,150 at 940 primary and secondary schools.
- To pilot new Maths and Science programmes at key stage 4.
- To create, maintain, and deliver programmes that have a high impact on pupil progress and attainment, evidenced by impact studies and data.
- For all Ark Schools to use all AC+ programmes, and for Ark Schools teachers and Principals to feel part of programme developments.
## _**Ark Start**_
In 2022/23, Ark Start plans to:
- Secure high-quality EYFS provision at Ark Start.
- Embed staff training and development.
- Continue to work towards financial sustainability.
- Further develop its family support programme.
- Engage with the Department for Education in public policy discussions.
- Provide strong EYFS support to primary schools within the Ark Schools network.
Building on the success of MESME, Ark UK Programmes is planning to launch two new programmes in 2022/23:
## _**STEM Venture Builder**_
- A venture builder focused on addressing education and engagement challenges across Science, Technology, Engineering, and Maths (STEM) subjects.
## _**Martingale Foundation**_
- A post-graduate scholarship programme, whose mission will be to find, fund, and support a new generation of STEM postgraduates for whom family income would otherwise be a barrier to the pursuit of academic excellence. The Foundation will begin by focusing on Masters and PhD scholarships in Maths.
As of 1 September 2023, the STEM Venture Builder and the Martingale Foundation will move to a new entity outside of Ark UK Programmes (see note 20).
6
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Financial review**
Total Ark UK Programmes income during the year was £5.7m (2020/21 - £5.3m), which is made up of programme income (grants and donations, programme fees, and other income from activities less endowment income). The split of programme income between the ventures was as follows:
- 69% (2020/21 – 74%) to AC+
- 16% (2020/21 – 18%) to MESME
- 15% (2020/21 – 8%) to Ark Start
The principal funding sources for the year have been grants to ventures and school payments to AC+. All expenditure has supported the charity’s key objectives, as described in the review of performance above.
The net movement in funds for the year was a surplus of £0.3m (2020/21 - £0.2m). This included a loss of £0.2m (2020/21 – gain of £0.8m) on the endowments held as investments for the schools.
The charity had net assets at 31 August 2022 of £9.8m (2020/21 - £9.4m), comprising £6.1m (2020/21 - £6.3m) of endowment funds, £3.7m (2020/21 - £3.0m) of other restricted funds, and £38k (2020/21 - £53k) of unrestricted funds (the free reserves of the charity). Given the programme-related nature of the charity’s activities, which are mainly funded via restricted funds, the trustees consider the level of free reserves to be satisfactory.
## **Reserves Policy**
New Ark ventures are incubated only when external funding has been secured or a funding commitment has been made by Ark. For this reason, the charity’s unrestricted reserve levels are expected to remain below £100k, with the majority of funds being restricted to the individual ventures. The unrestricted funds balance at 31 August 2022 was £38k, sufficient to fund more than 12-months’ unrestricted expenditure. Within each of the restricted fund balances, the charity will aim to hold sufficient funds to cover 3-6 months of core programme operating costs.
Ark UK Programmes has taken all necessary steps to reduce both the operational and financial impact of the post pandemic environment and other cost pressures due to the wider economic challenges.
Costs have been closely monitored to ensure that unrestricted reserves remain sufficient to meet financial commitments and obligations.
## **Investment Policy**
As at 31 August 2022, Ark UK Programmes had a portfolio of investments with a market value of £6.0m (2020/21 - £6.3m).
There are no restrictions on the charity’s power to invest. The investment strategy is set by the trustees and considers income requirements, the risk profile, and the investment manager’s view of the market prospects in the medium term. The overall investment policy is to maximise total return through a diversified portfolio, aiming to provide the level of income advised by the trustees and, at the same time, with a view to ensuing that capital appreciation of the fund exceeds inflation over any five-year period.
7
**Ark UK Programmes**
**Trustees’ report including Strategic Report** Year ended 31 August 2022
## **Investment Policy** (continued)
Financial derivative products are used to ameliorate the risk associated with holding investments in foreign currencies. A trustee and management meet with the investment managers at least annually to review the performance of the portfolio and the investment strategy. The trustees are satisfied that their investment policy is being achieved.
## **Public Benefit**
Ark UK Programmes exists to advance the education of the public. The trustees have paid due regard to the Charity Commission’s public benefit guidance and are satisfied that the charity complies with Section 4 of the Charities Act 2011. The sections at the beginning of this trustees’ report dealing with objectives and achievements explain in detail the activities of the charity and how the public, specifically children, benefit from its work.
## **Approach to fundraising**
Ark fundraises from a defined list of individuals, companies, and charitable trusts and foundations. This list is carefully considered, and approaches are only made to those we already have a connection to, or where we think there would be an interest in Ark’s work. Ark’s network of schools conducts their own fundraising and may use fundraising platforms to promote specific school campaigns, including Just Giving.
Ark’s fundraising is led by a small team of professional fundraisers and support staff employed by Ark – we do not out-source fundraising activities. Our activity is based on individual relationships with donors. Donor data is handled with care – all information is held on a secure database and files managed by Ark.
Ark is a paid member of the Fundraising Regulator, and we comply with the advice and guidance set by the body. We have not received any fundraising complaints.
8
Ark UK Programmes
Tntee$, report ineludRng Strategic Report Year ended 31 August 2022
Statement of trustees. responsibilitieg
The tnteeS (who are also directors of Ark UK Programmes for the purposes of
company law) are restx)nsible for preparing the trustees, rew>rt and financial
statements in aceordanee with applicable law and United Kingdom Accounting
Standards (United Kingdom Generally ACpted Aecounling Practice).
Company law requires the trustees to prepare financial statements for each financial
year which give a true and fair view of the stste of affairs of the eharitable cornpany
and of the income and expenditure of the charitable company for that period.
In preparing those financial statements, the trustees are required to..
seleet suitable accounting policies and then apply thein consistently;
observe the meth(xls and principles in Accounting and Reporting by
Charities.. Statement of Recommended Practice applicable to charities
preparing their aceounis in accordance with the Financial Rewrting
Standard applicable to the United Kingdom and Republic of Ireland (FRS
make judgements and estimates that are reasonable and prudent.
state whether applieable United Kingdom Accounting Standards hdve been
followed, subject to any material departures disclosed and explained in the
financial statements: and
prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the charitable company will continue in
operation.
The trustees are reswnsible for keeping proper accounting records that disclose with
reasonable accuracy at any time the financial wsition of the charitable Company and
enable them to ensure that the financial statements comply with the Companies Act
2006. They are also reswnsible for safeguarding the assets of the charitable
company and hence for takin8 reasonable step5 for the prevention and deteLtion of
fraud and other irregularities.
Each of the trustees confirn)s that:
so far as the trustee is aware, there is no relevant audit information of which
the charitable company's auditor is unaware. and
the trustee has taken all the steps that they ought to have taken as a trustee
in order to make themselves aware of any relevant audit information and to
establish that the company's auditor is aware of that information.
This confirniation is given and should be interpreted in accordance with the
provisions of s418 of the Companies Act 2006.
The trustees are restx)nsible for the maintenanee and integrity of the company and
financial information included on the Company's website. l£gislation in the United
Kingdom governing the preparation and di&semination of financial statements may
differ from legislation in other jurisdictions.
Approved by the trustees and signed on their behalf by iA)rd Fink:
Trustee
Date: 1710512023
**Ark UK Programmes**
**Independent auditor’s report to the member of Ark UK Programmes** Year ended 31 August 2022
## **Opinion**
We have audited the financial statements of Ark UK Programmes (the ‘charitable company’) for the year ended 31 August 2022 which comprise the statement of financial activities, the balance sheet, and statement of cash flows, the principal accounting policies, and the notes to the financial statements. 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 August 2022 and of its income and expenditure for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Companies Act 2006.
## **Basis for opinion**
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
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.
10
**Ark UK Programmes**
**Independent auditor’s report to the member of Ark UK Programmes** Year ended 31 August 2022
## **Other information**
The other information comprises the information included in the annual report and financial statements, other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report and financial statements. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
## **Opinions on other matters prescribed by the Companies Act 2006**
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the trustees’ report, which is also the directors’ report for the purposes of company law for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the trustees’ report, which is also the directors’ report for the purposes of company law, has been prepared in accordance with applicable legal requirements.
## **Matters on which we are required to report by exception**
In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ 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:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of trustees’ remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit; or
- the trustees were not entitled to prepare the financial statements in accordance with the small companies’ regime and take advantage of the small companies’ exemptions in preparing the trustees’ report and from the requirement to prepare a strategic report.
11
**Ark UK Programmes**
**Independent auditor’s report to the member of Ark UK Programmes** Year ended 31 August 2022
## **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.
## **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 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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities, and skills to identify or recognise noncompliance with applicable laws and regulations;
- we identified the laws and regulations applicable to the charitable company through discussions with trustees and other management, and from our knowledge and experience of the sector;
- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the charitable company, including the Charities Act 2011, Companies Act 2006, data protection legislation, anti-bribery, employment, and health and safety legislation;
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
12
**Ark UK Programmes**
**Independent auditor’s report to the member of Ark UK Programmes** Year ended 31 August 2022
**Auditor’s responsibilities for the audit of the financial statements** (continued)
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the charitable company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected, and alleged fraud; and
- considering the internal controls in place to mitigate risks of fraud and noncompliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
- performed analytical procedures to identify any unusual or unexpected relationships;
- tested journal entries to identify unusual transactions;
- assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
- used data analytics to investigate the rationale behind any significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
- agreeing financial statement disclosures to underlying supporting documentation;
- reviewing the minutes of meetings of those charged with governance;
- enquiring of management as to actual and potential litigation and claims; and
- reviewing any available correspondence with the charitable company’s legal advisors.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the trustees and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
13
## **Ark UK Programmes**
**Independent auditor’s report to the member of Ark UK Programmes** Year ended 31 August 2022
**Auditor’s responsibilities for the audit of the financial statements** (continued)
A further description of our responsibilities is available on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
## **Use of our report**
This report is made solely to the charitable company’s member, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's member those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's member as a body, for our audit work, for this report, or for the opinions we have formed.
26 May 2023
Katharine Patel, Senior Statutory Auditor For and on behalf of Buzzacott LLP, Statutory Auditor 130 Wood Street London EC2V 6DL
14
## **Ark UK Programmes**
**Statement of financial activities-** Year ended 31 August 2022
|Notes|
Unrestricted
£’000|Restricted
£’000|Endowments
£’000|**Year**
**ended**
**31 August**
**2022**
**Total**
**£’000**|Year
ended
31 August
2021
Total
£’000|
|---|---|---|---|---|---|
|**Income from:**
Donations and legacies:
Grants and donations
2a
Donated services
2b
Charitable activities
Programme fees
2c
Other income from activities
2c
Investments
3
**Total income**
6
**Expenditure on:**
Raising funds
Investment management fees
Interest on finance lease
Charitable activities
Support to programmes
4,5
Donated services
2b,4
Transfers to Now Teach
20
**Total expenditure**
6
Net (expenditure) income before
(losses) gains on investments
(Losses) gains on investments
9, 10
Net (expenditure) income and
net movement in funds
**Reconciliation of funds**
**Funds brought forward**
**at 1 September 2021**
**Funds carried forward at 31**
**August 2022**
6|
1
-
-
-
-|3,109
-
2,365
194
65|-
-
-
-
-|**3,110**
**-**
**2,365**
**194**
**65**|2,008
35
2,676
467
92|
||
**1**|**5,733**|**-**|**5,734**|5,278|
||-
-
16
-
-|-
-
5,113
-
-|61
1
-
-
-|**61**
**1**
**5,129**
**-**
**-**|57
1
5,060
35
706|
||
16|5,113|62|**5,191 **|5,859|
||(15)
-|620
-|(62)
(224)|**543**
**(224)**|(581)
785|
||**(15)**
**53**|**620**
**3,043**|**(286)**
**6,341**|**319**
**9,437**|204
9,233|
||
**38 **|**3,663**|**6,055**|**9,756 **|9,437|
There were no recognised gains and losses in the period other than those stated above.
15
## **Ark UK Programmes**
## **Statement of financial activities-** Year ended 31 August 2022
||**Continuing**
**operations**
**2022**
**£’000**
**Discontinued**
**operations**
**2022**
**£’000**
**Year**
**ended**
**2022**
**£’000**
Continuing
operations
2021
£’000
Discontinued
operations
2021
£’000
Year
ended
2021
£’000|
|---|---|
|Total income
Total
expenditure
**Net income**
**(expenditure)**
**for theyear**|5,734
**-**
5,734
5,278
-
5,278
(5,129)
**-**
(5,129)
(5,801)
-
(5,801)|
||**605**
**-**
**605**
(523)
-
(523)|
The income and expenditure account above excludes the movement on the endowments fund. It is stated before losses/gains on investments and transfers.
The summary income and expenditure account is derived from the statement of financial activities on page 15 which, together with the notes to the financial statements on pages 20 to 367, provides full information on the movements during the year on all the funds of the charity.
Total income of £5,734k (2020/21 - £5,278k) comprises £1k (2020/21 - £12k) in relation to unrestricted funds and £5,733k (2020/21 - £5,266k) in relation to restricted funds. A detailed analysis of income and expenditure by source is provided in the statement of financial activities and the notes to the financial statements.
Net income for the year of £605k (2020/21 – net expenditure of £523k) comprises net expenditure of £15k (2020/21 - £12k net income) in relation to unrestricted funds and net income of £620k (2020/21 – net expenditure of £535k) in relation to restricted funds, as shown in the statement of financial activities.
Note that the above includes the one-off transfer in 2021 to Now Teach.
16
Ark UK Programmes
Balance sheet 31 August 2022
2021
£'ooo
Note8
£'ooo
Fed a88¢ts
Investment property
Investment assets
656
6,041
746
6.282
io
6,697
7,028
Current a88et8
Debtors
Short terni deposits
Cash at bank And in hand
35265
57*
717
1,693
572
l.911
4?554
4,176
Credltor6: amounts due within one year
l2
(1•464)
11,641)
Net eurrent A68ets
3>090
235
Total lets leo8 currenl Ilabllitl
9y787
9,563
Credltors: amounts dueafter more than one year
(31)
1126}
Net aueQ•
9>756
9,437
The fundB of the eharlty
Unrestrirted general funds
Restried funds
Endowinent funi
38
3y663
6,oss
53
3,043
61341
Tot funds
9>756
9,437
Approved by the board of truste&8 and signed on its behalf by:
)rd Fink
Trustee
Date: 1810512023
Company registration no: 05932797
## **Ark UK Programmes**
**Statement of cash flows** Year to 31 August 2022
|Notes|**2022**
**£’000**|2021
£’000|
|---|---|---|
|**Cash flows from operating activities:**
Net cash (used in) operating activities
A
**Cash (used in) operating activities**
**Cash flows from investing activities:**
Investment income
Proceeds from the disposal of investments
Purchase of investments
**Net cash provided by investing activities**
**Change in cash and cash equivalents in the year**
**Cash and cash equivalents at 1 September**
B
**Change in cash and cash equivalents due to exchange**
**rate movements**
**Cash and cash equivalents at31 August**
B|**(1,266)**|(845)|
||**(1,266)**|(845)|
||**65**
**2,276**
**(2,183)**|92
3,836
(2,893)|
||**158 **|1,035|
||**(1,108)**
**1,943**
**(95)**|190
1,693
60|
||**740 **|1,943|
## **Notes to the statement of cash flows for the year to 31 August 2022.**
## **A Reconciliation of net movement in funds to net cash provided by (used in) operating activities**
|**in) operating activities**|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|**Net movement in funds (as per the statement of financial**
**activities)**
**Adjustments for:**
Losses (gains) on investments
Investment income
(Increase) decrease in debtors
(Decrease) in creditors (excluding endowment creditors)
**Net cash(used in) operating activities**|**319**
**224**
**(65)**
**(1,572)**
**(172)**|204
(785)
(92)
1,727
(1,899)|
||**(1,266)**|(845)|
18
## **Ark UK Programmes**
**Statement of cash flows** Year to 31 August 2022
**Notes to the statement of cash flows for the year to 31 August 2022** (continued) **.**
## **B Analysis of cash and cash equivalents**
|**Analysis of cash and cash equivalents**|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|Cash at bank and in hand
Cash held by investment managers
**Total cash and cash equivalents**|**717**
**23**|1,911
32|
||**740 **|1,943|
Cash held by investment managers relates to the endowments invested with JP Morgan. It is not available for use by Ark UK Programmes to further charitable activities.
## **C Analysis of changes in net debt**
|**Analysis of changes in net debt**|||||
|---|---|---|---|---|
||At 1
September
2021
£’000|Cash
flows
£’000|Other
non-cash
changes
£’000|**At 31**
**August**
**2022**
**£’000**|
|Cash at bank and in hand
Cash held by investment managers
Short term deposits
Finance lease obligations
**Total**|1,911
32
572|(1,194)
(9)
-|-
-
-|**717**
**23**
**572**|
||2,515
(126)|(1,203)
95|-
-|**1,312**
**(31)**|
||2,389|(1,108)|-|**1,281**|
19
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **1 Accounting policies**
## _**Basis of preparation**_
These financial statements have been prepared for the year to 31 August 2022.
The financial statements have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant accounting policies below or the notes to these financial statements.
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard applicable to the United Kingdom and Republic of Ireland (FRS102) (Charities SORP FRS102), the Charities Act 2011 and the Companies Act 2006.
The charity constitutes a public benefit entity as defined by FRS 102.
The financial statements are presented in sterling and are rounded to the nearest thousand pounds.
## _**Critical accounting estimates and areas of judgement**_
Preparation of the accounts requires the trustees and management to make significant judgements and estimates.
The items in the accounts where these judgements and estimates have been made include:
- Estimating the impact of inflation on the charity’s income and expenditure, and assessing income from new sales and activities, for the purpose of preparing cash flow forecasts and budgets to assist in the assessment of going concern;
- Allocating support costs across charitable activities;
- Timing of income recognition for programme fees;
- Classification of leases as finance or operating;
- Determining the discount rate for future cash flows;
- Measurement of fair values of the investment property.
## _**Assessment of going concern**_
The trustees have assessed whether the use of the going concern assumption is appropriate in preparing these financial statements. The trustees have made this assessment in respect to a period of one year from the date of approval of these financial statements.
The trustees have have considered the impact of the post pandemic enviroment and other cost pressures due to the wider economic challenges. The trustees have looked at the financial position, including income, expenditure, and reserves, and have acknowledged that some areas of work continue to be challenging, for example AC+ activity in UK schools. The trustees do not consider the post-pandemic environment or other cost pressures due to wider economic challenges to be a cause for material uncertainty in respect of the ability of the charity to continue as a going concern.
20
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **1 Accounting policies** (continued)
## _**Assessment of going concern** (continued)_
A number of areas of judgement that affect items in the accounts have been identified above. In addition, the most significant areas that affect the carrying value of the assets held by the charity in the next accounting period (the year ending 31 August 2023) are the level of investment return and the performance of the investment markets (see the investment policy and the risk management sections of the trustees’ report for more information). The trustees remain of the opinion that the charity will have sufficient resources to meet its liabilities as they fall due.
In the unlikely event that the charity was unable to meet its liabilities, the parent charity, Ark, would provide the necessary financial support in the form of a grant or loan.
The trustees have therefore concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the charity to continue as a going concern.
## _**Fund accounting**_
Restricted funds are those which are to be used for a specified purpose as stipulated by the donor and agreed by the charity.
Unrestricted funds are those which the donor gives to the charity without stipulating a specific purpose. They are to be used for the furtherance of the objects of the charity in general and may be applied to specific projects at the discretion of the trustees to further the charity’s purposes.
The endowment fund represents monies invested on behalf of individual Ark academies. Any returns generated on these funds can be used without restriction, but only by the academy in question, and are therefore recognised as restricted income. The initial capital can only be used with agreement of the Secretary of State for Education, unless it is spent on ‘equipment, facilities, accommodation, landscaping, and signage’ at the relevant academy. The Ark All Saints Academy endowment is a permanent endowment for which Ark UK Programmes has been appointed as the trustee.
All income and expenditure is shown in the Statement of Financial Activities.
## _**Income**_
Income is recognised in the period in which the charity has entitlement to the income, the amount of income can be measured reliably, and it is probable that the income will be received. Where a service is provided over a period that spans more than one accounting period, a judgement is made as to the amount of income that should be accrued or deferred.
Donated services and facilities provided to the charity are recognised in the period when it is probable that the economic benefits will flow to the charity, provided they can be measured reliably. This is normally when the service is provided. An equivalent amount is included as expenditure.
Donated services and facilities are recognised on the basis of the value of the gift to the charity which is the amount the charity would have been willing to pay to obtain facilities or services of equivalent economic benefit on the open market.
21
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **1 Accounting policies** (continued)
## _**Expenditure**_
Liabilities, including those relating to staff costs and redundancies, are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to the expenditure. Expenditure is accounted for on an accrual basis and has been classified under headings that aggregate all costs related to the category.
Ark UK Programmes is registered for VAT and reclaims VAT in its business-related expenditure. Irrecoverable VAT is included in expenditure when incurred.
Costs of raising funds are those incurred in seeking donations for the charity and in publicising the work of the charity.
Expenditure on charitable activities comprise expenditure related to the direct furtherance of the charity’s objectives. In the accounts of the charity, the award of a grant is recorded as charitable expenditure and the unspent amount is held in the balance sheet as a grant creditor.
## _**Allocation of overhead and support costs**_
Support costs are those functions that assist the work of the charity but do not directly undertake charitable activities. Support costs include back-office costs, finance, payroll, and Governance costs which support the charity’s programmes and activities. Governance costs are those incurred in connection with the management of the charity’s assets, organisational administration, and compliance with constitutional and statutory requirements.
Where costs cannot be directly attributed, they have been allocated to activities. The basis for the allocation of support costs to charitable activities is set out in note 5 to the financial statements.
## _**Volunteers and donated services**_
With the exception of trustees, patrons and a small number of advisors who all provide their services on a voluntary basis, the charity does not rely upon volunteers or donated services in delivering services. The financial value of services donated by advisors is included as expenditure at an estimated fair value and a corresponding value of income is included as an in-kind donation.
## _**Discontinued activities**_
Where a decision has been made to discontinue or terminate an activity in accordance with the definitions contained within FRS 102, income, costs, and obligations associated with the discontinuing operation are recognised within the year. The income, costs, and obligations are disclosed separately on the face of the statement of financial activities.
## _**Investments**_
Investments are a form of basic financial instrument and are initially recognised at their transaction value and subsequently measured at their fair value as at the balance sheet date. Realised and unrealised gains (or losses) are credited (or debited) to the statement of financial activities in the year in which they arise.
22
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **1 Accounting policies** (continued)
## _**Investments** (continued)_
A fair value hierarchy that prioritises the inputs to valuation techniques is used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and lowest priority to unobservable inputs (Level 3 measurement). The levels of fair value hierarchy are described below:
- Level 1 (listed investments) – Unadjusted quoted process in active markets that are accessible at the measurement date for identical, unrestricted assets, or liabilities;
- Level 2 (unlisted investments) – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable either directly or indirectly; and
- Level 3 (unlisted investments) – Prices or valuation that requires inputs that are both significant to the fair value measurement and unobservable.
Investments that trade in markets that are not considered to be active but are valued based on quoted market prices for an identical instrument, dealer quotations, or alternative pricing sources supported by observable inputs are classified within Level 2. As Level 2 investments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.
The main form of financial risk faced by the charity is that of volatility in equity markets and investment markets due to wider economic conditions, the attitude of investors to investment risk, and changes in sentiment concerning equities and within particular sectors or sub-sectors.
## _**Investment Property**_
Investment property is held by Ark UK Programmes to earn rentals and for capital appreciation, rather than for use in the ordinary course of business. Investment properties are measured at cost and subsequently at fair value at the reporting date. Professional advice is sought as appropriate to determine the valuation of investment property. Changes in fair values are recognised in the statement of financial activities.
Investment property is subject to renovations or improvements at regular intervals. The cost of major renovations and improvements is capitalised. The cost of maintenance, repairs, and minor improvements is recognised in the statement of financial activities when occurred.
On disposal of an investment property, the difference between the disposal proceeds and the carrying amount is recognised in the statement of financial activities.
## _**Foreign currencies**_
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are restated at the rate of exchange ruling at the balance sheet date.
23
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **1 Accounting policies** (continued)
## _**Operating lease**_
Operating lease rentals are charged on a straight-line basis over the term of the lease. These are included in the Charitable Activities expenditure in the Statement of Financial Activities.
## _**Finance lease**_
A finance lease is recognised when it is determined that the lease arrangement transfers substantially all the risks and rewards of ownership to the lessee.
At the commencement of the lease term, Ark UK Programmes recognises its rights of use and obligations under the finance lease as an asset and a liability in the balance sheet at an amount equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, determined at the inception of the lease. Where the implicit rate cannot be determined, the charity’s incremental borrowing rate is used.
Any initial direct costs are added to the amount recognised as an asset. Subsequently, the minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability using the effective interest method, including updating the effective interest rate to reflect the charity’s incremental cost of capital. This rate was 3.20% (2020/21 - 0.74%).
## _**Debtors**_
Debtors are recognised at their settlement amount, less any provision for nonrecoverability. Prepayments are valued at the amount prepaid. They have been discounted to the present value of the future cash receipt where such discounting is material.
## _**Cash at bank and in hand**_
Cash at bank and in hand represents such accounts and instruments that are available on demand or have a maturity of less than three months from the date of acquisition. Deposits for more than three months but less than one year have been disclosed as short-term deposits. Cash placed on deposit for more than one year is disclosed as a fixed asset investment.
## _**Creditors and provisions**_
Creditors and provisions are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Creditors and provisions are recognised at the amount the charity anticipates it will pay to settle the debt. They have been discounted to the present value of the future cash payment when such discounting is material.
24
## **Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **2 a. Grants and Donations**
During the year, the organisation received the following grants and donations:
|**2022**|Unrestricted
£’000|Restricted
£’000|Endowments
£’000|**Total**
**2022**
**£’000**|
|---|---|---|---|---|
|Ark Curriculum+
Ark Start
MESME
Martingale Foundation
Unrestricted
**2022 total**|-
-
-
-
1|1,455
714
905
35
-|-
-
-
-
-|**1,455**
**714**
**905**
**35**
**1**|
||**1**|**3,109**|**-**|**3,110**|
|_2021_|_Unrestricted_
_£’000_|_Restricted_
_£’000_|_Endowments_
_£’000_|_Total_
_2021_
_£’000_|
|_Ark Curriculum+_
_Ark Curriculum+ (DCMS)_
_Ark Start_
_MESME_
**_2021 total_**|_-_
_-_
_-_
_-_|_406_
_350_
_383_
_869_|_-_
_-_
_-_
_-_|_406_
_350_
_383_
_869_|
||**_-_**|_2,008_|**_-_**|_2,008_|
## **2 b. Donated Services**
During the year, the organisation did not receive any donated services (2020/21 - £35,000 for Ark Curriculum+). Donated services, for example event space, are valued at the open market cost as determined by the supplier.
## **2 c. Income from charitable activities**
|**2022**|Unrestricted
£’000|Restricted
£’000|Endowments
£’000|**Total**
**2022**
**£’000**|
|---|---|---|---|---|
|**Programme fees**
Ark Curriculum+
Ark Start
**Other income from charitable**
**activities**
Ark Curriculum+
Ark Start
**2022 total**|-
-|2,270
95|-
-|**2,270**
**95**|
||-
-
-|**2,365**
169
25|-
-
-|**2,365**
**169**
**25**|
||**-**|**194**|**-**|**194**|
||**-**|**2,559**|**-**|**2,559**|
25
**Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **2 c. Income from charitable activities** (continued)
|_2021_|_Unrestricted_
_£’000_|_Restricted_
_£’000_|_Endowments_
_£’000_|
_Total_
_2021_
_£’000_
_2,645_
_31_
_2,676_
_432_
_23_
_12_
_467_
_3,143_|
|---|---|---|---|---|
|**_Programme fees_**
_Ark Curriculum+_
_Ark Start_
**_Other income from charitable_**
**_activities_**
_Ark Curriculum+_
_Ark Start_
_Other_
**_2021 total_**|_-_
_-_|_2,645_
_31_|_-_
_-_||
||_-_
_-_
_-_
_12_|_2,676_
_432_
_23_
_-_|_-_
_-_
_-_
_-_||
||_12_|_455_|_-_||
||_12_|_3,131 _|_-_||
## **3 Investment income**
|**Investment income**||||
|---|---|---|---|
|**2022**|Unrestricted
£’000|Restricted
£’000
54
11
**65**|**Total**
**2022**
**£’000**|
|Income and interest from listed investments
Income from investment property
**2022 total**|-
-||**54**
**11**|
||**-**||**65**|
|_2021_|_Unrestricted_
_£’000_|
_Restricted_
_£’000_
_72_
_20_
_92_|_Total_
_2021_
_£’000_|
|_Income and interest from listed investments_
_Income from investment property_
**_2021 total_**|_-_
_-_||_72_
_20_|
||_-_||_92 _|
In 2009/10, Ark UK Programmes was given responsibility for the administration of the endowments held on behalf of individual Ark academies. These funds are invested with JP Morgan and the relationship is set out in a Deed of Gift between Ark UK Programmes, Ark, and the Secretary of State for Education. King Solomon Academy contributed an additional £750k into its endowment, which is outside of the Deed of Gift. In January 2015, Ark UK Programmes was appointed as the trustee of an endowment held under a Trust Deed for Ark All Saints Academy (formerly St Michael and All Angels Church of England Academy). The value of the endowment transferred into Ark UK Programmes was £607k.
26
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **4 Analysis of charitable expenditure**
|**2022**|Activities
undertaken
directly
£’000|Donated
services
(see
note 2b)
£’000|
Grant
funding of
activities
£’000|Support
costs (see
note 5)
£’000|
**Total**
**2022**
**£’000**
**3,356**
**787**
**922**
**35**
**13**
**16**
**5,129**|
|---|---|---|---|---|---|
|**Charitable expenditure**
Ark Curriculum+
Ark Start
MESME
Martingale Foundation
Endowment programme
Unrestricted
**2022 total**|3,244
730
921
35
7
4|-
-
-
-
-
-|-
-
-
-
-
-|112
57
1
-
6
12||
||**4,941**|-|-|**188**||
|_2021_|_Activities_
_undertaken_
_directly_
_£’000_|_Donated_
_services_
_(see_
_note 2b)_
_£’000_|
_Grant_
_funding of_
_activities_
_£’000_|_Support_
_costs (see_
_note 5)_
_£’000_|_Total_
_2021_
_£’000_
_3,516_
_350_
_861_
_354_
_14_
_5,095_|
|---|---|---|---|---|---|
|**_Charitable expenditure_**
_Ark Curriculum+_
_Ark Curriculum+ (DCMS)_
_Ark Start_
_MESME_
_Endowment programme_
**_2021 total_**|_3,351_
_350_
_572_
_71_
_8_|_35_
_-_
_-_
_-_
_-_|_-_
_-_
_277_
_275_
_-_|_130_
_-_
_12_
_8_
_6_||
||_4,352_|_35_|_552_|_156_||
## **5 Allocation of support costs**
|**2022**|Finance
£’000|HR
£’000|Governance
£’000|Other
overheads
and support
staff
£’000
42
3
-
-
-
**45**|**Total**
**2022**
**£’000**|
|---|---|---|---|---|---|
|**Charitable expenditure**
Ark Curriculum+
Ark Start
MESME
Endowment programme
Unrestricted
**2022 total**|50
47
-
5
-|13
5
-
-
-|7
2
1
1
12||**112**
**57**
**1**
**6**
**12**|
||**102**|**18**|**23**||**188**|
Finance and HR costs are allocated on the basis of time spent on each programme. Other overheads consist of the desk charge, which is allocated on the basis of the number of desks reserved for each programme, IT costs, and any remaining core costs.
27
## **Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **5 Allocation of support costs** (continued)
The allocation of support costs to activities in note 4 provides a more accurate picture of the full costs of these activities. It does not represent use of programme funds.
|_2021_|_Finance_
_£’000_|_HR_
_£’000_|_Governance_
_£’000_|_Other_
_overheads_
_and_
_support_
_staff_
_£’000_|_Total_
_2021_
_£’000_|
|---|---|---|---|---|---|
|**_Charitable expenditure_**
_Ark Curriculum+_
_Ark Start_
_MESME_
_Endowment programme_
**_2021 total_**|_67_
_-_
_6_
_5_|_15_
_10_
_1_
_-_|_8_
_-_
_1_
_1_|_40_
_2_
_-_
_-_|_130_
_12_
_8_
_6_|
||_78 _|_26_|_10_|_42 _|_156 _|
## **6 Analysis of net movement in funds**
|**2022**|At 1
September
2021
£’000|Income
£’000|Expenditure
£’000|Gains/
(losses) and
transfers
£’000|**At 31**
**August**
**2022**
**£’000**|
|---|---|---|---|---|---|
|**Restricted funds**
Ark Curriculum+
Ark Start
MESME
Martingale Foundation
Ark Schools endowment
interest
**2022 total**
**Endowment funds**
**Unrestricted funds**
General
**Total funds**|1,567
509
513
-
454|3,894
834
905
35
65|(3,356)
(787)
(922)
(35)
(13)|-
-
-
-
-|**2,105**
**556**
**496**
**-**
**506**|
||3,043
6,341
53|5,733
-
1|(5,113)
(62)
(16)|-
(224)
-|**3,663**
**6,055**
**38 **|
||**9,437**|**5,734**|**(5,191)**|**(224)**|**9,756**|
The restricted funds of Ark Curriculum+ have arisen from grants given specifically for use by Ark Curriculum+ plus fees from schools signed up to the programmes and via the DCMS.
The Ark Start restricted funds have arisen from the receipt of grant income for use specifically on the respective programmes.
MESME restricted funds have arisen from the receipt of grant income to support students to achieve mathematical excellence under the Maths Circles programme following on from the success of the model established in Russia and the US.
In 2022/23, Martingale will launch as a new post-graduate scholarship programme, whose mission will be to find, fund, and support a new generation of STEM postgraduates for whom family income would otherwise be a barrier to the pursuit of academic excellence. The funds received in 2021/22 relate to set up costs and brand design.
28
## **Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **6 Analysis of net movement in funds** (continued)
The Ark Schools Endowment interest in restricted funds has arisen from dividends and interest paid out on the endowment investments held by Ark UK Programmes on behalf of individual Ark academies. The income is restricted for use by the Ark academy from whose endowment the income arose. The endowment fund represents monies invested on behalf of individual Ark academies. Any returns generated on these funds can be used without restriction, but only by the academy in question, and are therefore recognised as restricted income. The initial capital can only be used with agreement of the Secretary of State for Education, unless it is to be spent on ‘equipment, facilities, accommodation, landscaping, or signage’ at the relevant academy. The exception to this is the Ark All Saints Academy endowment for which Ark UK Programmes was appointed the trustee in January 2015. The principal sum of this endowment can only be spent with the permission of the Secretary of State.
At 31 August 2022, the balance of expendable endowments was £5,209k (2020/21 - £5,461k) and the balance of permanent endowments was £846k (2020/21 - £880k).
In the year, £62k expenditure was made from endowments (2020/21 - £58k); £61k for investment manager fees (2020/21 - £57k) and £1k interest on the finance lease (2020/21 - £1k, note 14).
|_2021_|_At 1_
_September_
_2020_
_£’000_|_Income_
_£’000_|_Expenditure_
_£’000_|_Gains/_
_(losses) and_
_transfers_
_£’000_|_At 31_
_August_
_2021_
_£’000_|
|---|---|---|---|---|---|
|**_Restricted funds_**
_Ark Curriculum+_
_Ark Curriculum+ (DCMS)_
_Ark Start_
_MESME_
_Ark Schools endowment_
_interest_
_Now Teach_
**_2021 total_**
**_Endowment funds_**
**_Unrestricted funds_**
_General_
**_Totalfunds_**|_1,565_
_-_
_932_
_-_
_375_
_706_|_3,518_
_350_
_437_
_869_
_92_
_-_|_(3,516)_
_(350)_
_(860)_
_(356)_
_(13)_
_(706)_|_-_
_-_
_-_
_-_
_-_|_1,567_
_-_
_509_
_513_
_454_
_-_|
||_3,578_
_5,614_
_41 _|_5,266_
_-_
_12_|_(5,801)_
_(58)_
_-_|_-_
_785_
_-_|_3,043_
_6,341_
_53_|
||_9,233_|_5,278 _|_(5,859) _|_785_|_9,437_|
29
## **Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **7 Net movement in funds**
Net movement in funds is stated after charging:
||||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|Statutoryaudit fees|**9**|8|
|**Staff costs and numbers**|**2022**
**£’000**|2021
£’000|
|Salaries and wages
Social security costs
Pension costs|**2,464**
**279**
**266**|2,398
258
268|
||**3,009**|2,924|
## **8 Staff costs and numbers**
No redundancy and ex-gratia severance payments were made in the year (2020/21 – £35,873).
The average number of staff employed during the period was:
||**Headcount**
**2022**
2021|**Headcount**
**2022**
2021|
|---|---|---|
|||2021|
|Charitable activities
Support to activities|**49**
**5**
**54**|48
4
52|
The number of employees during the period who earned over £60,000 in the year (including benefits) was as follows:
||**2022**
**£’000**|2021
£’000|
|---|---|---|
|£60,001 - £70,000
£70,001 - £80,000
£90,001 - £100,000
£100,001 - £110,000
£110,001 - £120,000|**2**
**2**
**1**
**1**
**1**|6
2
1
-
1|
||**7**|10|
The pension contributions made on behalf of the above employees was £64,535 (2020/21 - £49,839)
Key management personnel of Ark UK Programmes comprise the trustees and the senior management team as listed on page 1. The total amount of employee benefits (including pension and social security contributions) received by key management personnel was £112,047 (2020/21 - £108,195). Payment to all key management personnel was made by the parent charity, Ark.
30
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **9 Investment property**
|**Investment property**|||
|---|---|---|
||Land and
buildings
£’000|**Total**
**£’000**|
|**Cost or valuation:**
At 1 September 2021
Decrease in fair value
At 31 August 2022
Carryingamount at31 August 2022|746
(90)|**746**
**(90)**|
||656|**656 **|
||||
||656|**656 **|
The long leasehold investment property is held at fair value. Completion of the property was on 20 May 2016. The trustees have performed the valuation of the property at 31 August 2022 based on publicly available information.
Included in the amount for investment property is £31,387 (2020/21 - £125,653) relating to assets held under a finance lease (note 14).
## **10 Investment assets**
|**Investment assets**|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|**Listed investments**
Market value at 1 September
Additions to investments at cost
Disposals at market value - proceeds: £2,276k (2020/21: £3,836k); gain
£34k (2020/21: loss £49k)
Net unrealised investment (loss) gain
Market value at 31 August
**Cash held by investment managers for reinvestment**
Cost of listed investments at31 August|**6,250**
**2,183**
**(2,310)**
**(105)**|6,466
2,893
(3,787)
678|
||**6,o18**
**23**|6,250
32|
||**6,041 **|6,282|
||**5,631 **|5,420|
All listed investments were traded on a recognised stock exchange. Listed investments held at 31 August 2022 comprised the following:
||**2022**
**£’000**|2021
£’000|
|---|---|---|
|Overseas equities
Fixed interest
Alternative assets|**3,523**
**1,889**
**606**|3,857
1,755
638|
||**6,018**|6,250|
31
**Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **10 Investment assets** (continued)
All investments are held in a portfolio of diversified funds. Accordingly, no individual holding is considered to be material when compared to the total value of the listed investment portfolio at 31 August 2022.
Foreign exchange forward contracts are used to ameliorate the risk associated with holding investments in foreign currencies. These are held by the investment managers and form part of their strategy for managing risk.
||**2022**
**£’000**
**387**
**387**
**830**
**(338)**
**(105)**
**387**|2021
£’000
830
830
364
(212)
678
830|
|---|---|---|
|**Unrealised gains included above:**
On investments
**Total unrealised gains at 31 August**
**Reconciliation of movements in unrealised gains**
Unrealised gains at 1 September
Less: in respect to disposals in the year
Add: net unrealised (losses) gains
**Total unrealisedgains at31 August**|||
## **11 Debtors**
|**Debtors**|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|Trade debtors
Prepayments and other debtors
Accrued income
Amounts due from Absolute Return for Kids (Ark) (note 17)|**661**
**315**
**365**
**1,924**|419
155
61
1,058|
||**3,265**|1,693|
## **12 Creditors: Amounts falling due within one year**
|**Creditors: Amounts falling due within one year**|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|Accruals
Trade creditors
Deferred income
Amounts due to Absolute Return for Kids (Ark) (note 17)
Amounts due to Ark Schools (note 17)
Taxation and social security
Other creditors|**296**
**81**
**690**
**-**
**269**
**84**
**44**|313
148
621
282
180
77
20|
||**1,464**|1,641|
32
## **Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **12 Creditors: Amounts falling due within one year** (continued)
Deferred income relates to programme fees for Ark Curriculum+ received in advance for delivery in the following financial year. The movements in deferred income are analysed below:
||At 31 August
2021
£’000|Released
from
previous
year
£’000|Deferred in
current year
£’000|**At 31**
**August**
**2022**
**£’000**|
|---|---|---|---|---|
|Programme fees
**Total deferred income**|621|(621)|690|**690 **|
||621|(621)|690|**690 **|
## **13 Creditors: Amounts falling due after more than one year**
||**2022**
**£’000**|2021
£’000|
|---|---|---|
|Finance lease liability|**31 **|126|
||**31 **|126|
## **14 Finance lease**
The future minimum finance lease payments are as follows:
|The future minimum finance lease payments are as follows:|||
|---|---|---|
||**2022**
**£’000**|2021
£’000|
|Not later than one year*
Later than one year and not later than five years
Later than five years
Total gross payments
Less: finance charges
**Carrying amount of liability**|**-**
**2**
**300**|**-**
2
301|
||**302**
**(271)**|303
(177)|
||**31 **|126|
_*Lease payments of £400 are due in no later than one year._
The finance lease relates to the investment property (note 9). There are no contingent rental, renewal, or purchase option clauses.
33
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **15 Analysis of net assets between funds**
|**2022**|Unrestricted
General
fund
£’000|Restricted
funds
£’000|
Endowment
funds
£’000|
**Total**
**£’000**|
|---|---|---|---|---|
|**Fund balances at 31 August 2022 are**
**represented by:**
Investment assets
Current assets
Creditors: amounts falling due within one year
Creditors: amounts falling due in more than
one year
**Total net assets**|-
235
(197)
-|506
4,258
(1,101)
-|
6,191
61
(166)
(31)|
**6,697**
**4,554**
**(1,464)**
**(31)**|
||**38**|**3,663**|**6,055**|**9,756 **|
|||_Restricted_
_funds_
_£’000_|
_Endowment_
_funds_
_£’000_|
_Total_
_£’000_|
|_2021_|_Unrestricted_
_General_
_fund_
_£’000_||||
|**_Fund balances at 31 August 2021 are_**
**_represented by:_**
_Investment assets_
_Current assets_
_Creditors: amounts falling due within one year_
_Creditors: amounts falling due in more than_
_one year_
**_Total net assets_**|_-_
_134_
_(81)_
_-_|_451_
_3,986_
_(1,394)_
_-_|
_6,577_
_56_
_(166)_
_(126)_|
_7,028_
_4,176_
_(1,641)_
_(126)_|
||_53_|_3,043_|_6,341 _|
_9,437_|
## **16 Trustees’ remuneration and expenses**
The Chief Executive became a trustee of the charity on 1 September 2010. The Deputy Chief Executive became a trustee of the charity on 24 January 2019. For the year ended 31 August 2022, their combined remuneration by the parent charity, Ark, (including performance related bonus but excluding employer’s national insurance contributions) in relation to their roles in Ark UK Programmes was £90,930 (2020/21 - £87,536) and employer’s pension contribution were £8,800 (2020/21 - £8,525). No expenses were reimbursed through Ark UK Programmes. No other trustees of the company received any payment or other emoluments from the charity in the period.
34
**Ark UK Programmes**
## **Notes to the financial statements** Year to 31 August 2022
## **17 Related party transactions**
The charity is a wholly owned subsidiary of Absolute Return for Kids (Ark). Ark UK Programmes has taken advantage of the exemption available under Section 33 of FRS102 Related Party Disclosure not to disclose group transactions between the charity and its parent.
During the year, the organisation had the following transactions with Ark Schools. Ark Schools is an Ark family member, Lord Fink and Lucy Heller are also trustees of Ark Schools.
_Income from Ark Schools and individual Ark academies:_
- £118k (2020/21 - £272k) towards the costs of the Ark Curriculum+ resources and training and shared supplier accounts.
_Expenditure incurred with Ark Schools:_
- £136k (2020/21 - £212k) towards rent and service charges for shared office space with Ark Schools.
- £32k (2020/21 - £32k) towards technology services provided by Ark Schools.
Amounts due from and to Ark and Ark Schools are included within notes 11 and 12 respectively.
£0.1m (2020/21 - £0.3m) income was received in the year from The Education Endowment Foundation. Lucy Heller is a trustee of The Education Endowment Foundation and is also a trustee of Ark UK Programmes.
## **18 Ultimate parent undertaking**
During the year under review, the company’s immediate and ultimate parent undertaking was Absolute Return for Kids (ARK). Ark is registered in England as a charitable company limited by guarantee (company registration number 04589451; charity registration number 1095322). For the period under review, Ark has included Ark UK Programmes within its group financial statements, copies of which are available at its registered office: The Yellow Building, 1 Nicholas Road, London, W11 4AN.
## **19 Taxation**
Ark UK Programmes has charitable status (charity number 1137932). Given the nature of its activities, the charity will not be subject to income tax or corporation tax on income derived from its charitable activities, as it would fall within the various exemptions available to registered charities.
35
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **20 Post balance sheet events**
On 1 September 2022, MESME became an independent charity (Charity No. 1199281) with charitable objectives to grow the impact of Maths Circles and similar programmes. MESME will therefore not be included within the Ark UK Programmes’ accounts in future years.
In response to the significant growth over recent years, the Ark board approved the spin-out of a new organisation that would enable Ark UK Programmes’ non-schools ventures to become independent and continue to expand. Accordingly, as of 1 September 2023, the STEM Venture Builder and the Martingale Foundation will move to a new entity outside of Ark UK Programmes, alongside Ark employees who currently support these programmes. For clarity, Ark Curriculum+ and Ark Start will remain part of Ark UK Programmes.
36
**Ark UK Programmes**
**Notes to the financial statements** Year to 31 August 2022
## **21 Comparative statement of financial activities for continuing operations**
|Notes|
Unrestricted
£’000|Restricted
£’000|Endowments
£’000|Year
ended
31 August
2021
Total
£’000|
|---|---|---|---|---|
|Income from:
Donations and legacies:
Grants and donations
2a
Donated services
2b
Charitable activities
Programme fees
2c
Other income from activities
2c
Investments
3
Total income
6
Expenditure on:
Raising funds
Investment management
fees
Interest on finance lease
Charitable activities
Support to programmes
4,5
Donated services
2b,4
Transfers to Now Teach
20
Total expenditure
6
Net income (expenditure) before
gains on investments
Gains on investments
10
Net income (expenditure) and net
movement in funds
Reconciliation of funds
Funds brought forward
at 1 September 2020
Funds carried forward at 31 August
2021
6|
-
-
-
12
-|2,008
35
2,676
455
92|-
-
-
-
-|2,008
35
2,676
467
92|
||
12|5,266|-|5,278|
||-
-
-
-
-|-
-
5,060
35
706|57
1
-
-
-|57
1
5,060
35
706|
||
-|5,801|58|5,859|
||12
-|(535)
-|(58)
785|(581)
785|
||12|(535)|727|204|
||41|3,578|5,614|9,233|
||
53|3,043|6,341|9,437|
There were no recognised gains and losses in the period other than those stated above.
37