Registered number: 07649974 Charity number: 1147791
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee)
TRUSTEES' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
CONTENTS
| Page | |
|---|---|
| Reference and administrative details of the Company, its Trustees and advisers | 1 |
| Trustees' report | 2 - 7 |
| Independent auditors' report on the financial statements | 8 - 11 |
| Statement of financial activities | 12 |
| Balance sheet | 13 |
| Statement of cash flows | 14 |
| Notes to the financial statements | 15 - 27 |
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
REFERENCE AND ADMINISTRATIVE DETAILS OF THE COMPANY, ITS TRUSTEES AND ADVISERS FOR THE YEAR ENDED 30 JUNE 2021
Trustees
Andrew Golba James Penberthy (resigned 4 December 2020) Bryan Spence (resigned 16 June 2021) Judith Spence Joan Smidowicz Simon Day (appointed 30 September 2020) David Ellis (appointed 13 February 2021, resigned 21 May 2021) Kat Regester (appointed 13 February 2021, resigned 21 May 2021) Gerhard Schulz (appointed 13 February 2021) Timothy Monaghan (appointed 13 February 2021)
Company registered number
07649974
Charity registered number
1147791
Registered office
3 Newhouse Business Centre Old Crawley Road Horsham West Sussex RH12 4RU
Independent auditors
Baldwin Scofield Ltd Chartered Accountants Statutory auditors 3 Newhouse Business Centre Old Crawley Road Horsham West Sussex RH12 4RU
Bankers
NatWest Bank plc Northgate Hunstanton Norfolk PE36 6BB
Page 1
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
TRUSTEES' REPORT FOR THE YEAR ENDED 30 JUNE 2021
The Trustees present their annual report together with the audited financial statements of the Company for the 1 July 2020 to 30 June 2021. 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).
Since the Company qualifies as small under section 382 of the Companies Act 2006, the strategic report required of medium and large companies under the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 has been omitted.
Objectives and activities
Policies and objectives
The Carpenter's Arms is a Christian organisation that helps men who are challenged by homlelessness and have drug and alcohol addiction.
In setting objectives and planning for activities, the Trustees have given due consideration to general guidance published by the Charity Commission relating to public benefit, including the guidance 'Public benefit: running a charity (PB2)'.
Strategies for achieving objectives
The main strategy is for the individual to recognize the root cause of their addiction and for their key-worker and any other appropriate person to work with them to find a better way to manage similar situations in the future.
Activities undertaken to achieve objectives
The charity will provide structured group sessions around a syllabus five days a week as well as weekly one-onone sessions. Regular risk assessments and reviews are undertaken. Working in partnership with local employers, back to work skills, interviews and trials are also organised for clients where possible.
A balanced lifestyle includes gym, work parties, cooking, football, self-care, volunteering and the like.
Grant-making policies
The Trustees consider grant making an effective means of supporting charities with similar objects if there is a need for funding and surplus funds are available.
Volunteers
A number of volunteers are engaged with servicing the charity in various capacities. The number varies but averages around 8.
Volunteers receive an induction training including confidentiality briefing. Any drivers will be assessed on their capability. Teaching volunteers require credentials, DBS and then induction training and supervision whilst in the early stage of their volunteering. Cooking, administration and others are given different training ensuring that they are conversant with the resident’s needs and able to communicate effectively with them.
Page 2
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee)
TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2021
Objectives and activities (continued)
Main activities undertaken to further the Company's purposes for the public benefit
The Carpenters Arms is a Christian abstinence based residential programme for men aged 18-65 and challenged with homelessness due to an addictive lifestyle.
We have three phases to the programme and each phase has its own location and purpose:
Phase 1: Admission, carried out in the 12 bed Loughborough centre and 6 bed Kegworth centre where residents are supported whilst they withdraw from the effects of addiction.
Phase 2: The main programme, carried out between the 29 bed Six Hills centre and 12 bed Flaxley centre. This is where stabilisation takes place through one-on-one and group sessions.
Phase 3: Move on, carried out in multiple 5 bed houses across Charnwood and North West Leicestershire where residents live in a house with one staff member who helps them adjust to more independent living.
The vision for the charity is to see broken lives made new through Christ, and the charity is overtly Christian. We have come to see that Christian principles are intrinsic to recovery from addiction. Whilst no applicants or residents need to be Christian, there is a requirement to respect the Christian ethos.
All the staff are committed to helping them find recovery from addiction. We recognise that recovery is the resident’s responsibility but the charity will do all it can to support them in this.
Achievements and performance
Main achievements of the Company
This year we received 626 applications, an increase of approximately 48% on the previous year. We were one of the minority in the sector that remained open and receiving admissions through the Covid-19 lockdown.
Our occupancy and success rates were consistently high throughout the year, we believe due to the newer elements of our support programme.
We have worked to strengthen our relationships with local providers and the local community. In particular we have developed partnerships with several local employers who provide training, interviews and where possible, trial employment, to our residents.
We have worked to support, mentor and seek funding for resident led start up businesses with 2 such organisations remaining active by year end.
Page 3
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2021
Achievements and performance (continued)
Review of activities
The charity has started final preparations for the purchase of our Phase two accommodation. This has included extensive renovation works to raise the value of the property.
The women's recovery centre started operating in early September but after 6 months of extraordinary efforts from all involved, the programme ran at a substantial financial loss. Given the financial forecast we had to close this element of the company. The staff worked with the residents to find suitable placements with a similar local provider.
The charity had numerous employees isolating over the period of the year but maintained adequate staffing levels as well as appropriate training.
The charity continues to make progressive steps in their application to a regulatory body and has made several changes to governance, infrastructure and the support programme.
Fundraising activities and income generation
The main sources of income for the charity are in the form of an enhanced housing benefit and a modest rent from each resident’s Employment and Support Allowance (ESA) or Universal Credit.
Other income arises from our relationship with Church bodies and sympathetic persons who make irregular donations.
Financial review
Going concern
After making appropriate enquiries, the Trustees have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements. Further details regarding the adoption of the going concern basis can be found in the accounting policies.
Reserves policy
The trustees have a reserve policy of £300,000 (being three months running costs) to help smooth out cash flow timings. At year end this was not met due to the financial challenges of the last year and continued refurbishment of Six Hills, with unrestricted reserves at year end being £211,947.
Results for the year
Income for the year amounted to £1,649,010 (2020: £1,415,355) and expenditure £1,538,329 (2020: £1,341,891). The surplus of £76,265 (2020: £73,464) was added to funds brought forward resulting in unrestricted funds at the year end of £211,947 (2020: £135,682).
Page 4
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2021
Principal risks and uncertainties
The Trustees have considered the major risks to which the charity is exposed and have established systems and procedures to manage those risks. An annual review will be carried out and a risk register updated.
Internal control risks are minimised by the implementation of procedures for authorisation of all transactions and projects. An outside company is contracted to ensure compliance with health and safety of staff, volunteers, clients and visitors to the centre as well as all HR requirements.
Structure, governance and management
Constitution
The Carpenter's Arms (Midlands) Trust is registered as a charitable company limited by guarantee and was set up by a Memorandum of Association.
Methods of appointment or election of Trustees
The management of the Company is the responsibility of the Trustees who are elected and co-opted under the terms of the Memorandum of Association.
Policies adopted for the induction and training of Trustees
New Trustees are briefed by the existing Trustees and given an extensive tour of our centres with appropriate meetings with the managers. Policies and guidance are provided by a third party organisation with round the clock advice if needed. They are provided with the financial accounts of the charity and a copy of our management accounts. Trustees are encouraged to visit regularly and attend staff meetings.
Pay policy for key management personnel
The goal of a charity’s pay policy is to offer fair pay to attract and keep appropriately qualified staff to lead, manage, support and deliver the charity’s aims.
Related party relationships
The charity is connected to two other charities through the majority of Trustees in common, Homes for the Homeless Limited and Four Twelve Ministries. As of Jan 2021 Four Twelve Ministries was handed over to new directors and now has only one Trustee in common with Carpenter’s Arms.
Financial risk management
The Trustees have assessed the major risks to which the Company is exposed, in particular those related to the operations and finances of the Company, and are satisfied that systems and procedures are in place to mitigate exposure to the major risks.
Members' liability
The Members of the Company guarantee to contribute an amount not exceeding £1 to the assets of the Company in the event of winding up.
Page 5
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2021
Engagement with employees and employment of the disabled
Employees have been consulted on issues of concern to them by means of regular consultative committee and staff meetings and have been kept informed on specific matters directly by management. The Company carries out exit interviews for all staff leaving the organisation and has adopted a procedure of upward feedback for senior management and the Trustees.
The Company has implemented a number of detailed policies in relation to all aspects of personnel matters including:
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Equal opportunities policy
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Volunteers' policy
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Health & safety policy
In accordance with the Company's equal opportunities policy, the Company has long-established fair employment practices in the recruitment, selection, retention and training of disabled staff.
Full details of these policies are available from the Company's office.
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 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 . 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:
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select suitable accounting policies and then apply them consistently;
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observe the methods and principles of the Charities SORP (FRS 102);
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make judgments and accounting estimates that are reasonable and prudent;
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state whether applicable UK Accounting Standards (FRS 102) have been followed, subject to any material departures disclosed and explained in the financial statements;
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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:
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so far as that Trustee is aware, there is no relevant audit information of which the charity's auditors are unaware, and
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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.
Page 6
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee)
TRUSTEES' REPORT (CONTINUED) FOR THE YEAR ENDED 30 JUNE 2021
Auditors
The auditors, Baldwin Scofield 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 27 April 2022 and signed on their behalf by:
Gerhard Schulz
Page 7
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARPENTER'S ARMS (MIDLANDS) TRUST
Opinion
We have audited the financial statements of The Carpenter's Arms (Midlands) Trust (the 'charitable company') for the year ended 30 June 2021 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:
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give a true and fair view of the state of the charitable company's affairs as at 30 June 2021 and of its incoming resources and application of resources, including its income and expenditure for the year then ended;
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have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
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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.
Page 8
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARPENTER'S ARMS (MIDLANDS) TRUST (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:
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the information given in the Trustees' report is inconsistent in any material respect with the financial statements; or
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sufficient accounting records have not been kept; or
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the financial statements are not in agreement with the accounting records and returns; or
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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.
Page 9
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARPENTER'S ARMS (MIDLANDS) TRUST (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 that are applicable to the charitable company and determined that the most significant are those that relate to the reporting framework in conformity with the requirements of the Companies Act 2006 and Charities Act 2011 and the relevant direct and indirect tax compliance regulations in the United Kingdom.
We understood how the charitable company is complying with those frameworks by making enquiries of management to understand how the charitable company maintains and communicates its policies and procedures in these areas and corroborated this by reviewing supporting documentation and minutes of meetings of those charged with governance.
We assessed the susceptibility of the charity’s financial statements to material misstatement, including how fraud might occur by considering the risk of management override to be a fraud risk. In addition, we considered the risk of management override by sampling from the entire population of journals, identifying specific transactions which did not meet our expectations based on specific criteria and investigated these to gain an understanding and then agree back to source documentation.
Based on this understanding we designed our audit procedures to identify noncompliance with such laws and regulations. Our procedures involved verifying that material transactions were recorded in compliance with Financial Reporting Standards in conformity with the requirements of the Companies Act 2006 and Charities Act 2011.
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.
Page 10
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARPENTER'S ARMS (MIDLANDS) TRUST (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.
Baldwin Scofield Ltd
Chartered Accountants Statutory auditors 3 Newhouse Business Centre Old Crawley Road Horsham West Sussex RH12 4RU 27 April 2022
Baldwin Scofield Ltd are eligible to act as auditors in terms of section 1212 of the Companies Act 2006.
Page 11
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 30 JUNE 2021
| Note Income from: Donations and legacies 2 Charitable activities 3 Other income 4 Total income Expenditure on: Charitable activities 6 Total expenditure Net movement in funds before other recognised gains Other recognised gains: Other gains Net movement in funds Reconciliation of funds: Total funds brought forward Net movement in funds Total funds carried forward |
Unrestricted funds 2021 £ 57,591 1,568,355 23,064 1,649,010 1,577,693 1,577,693 71,317 4,948 76,265 135,682 76,265 211,947 |
Total funds 2021 £ 57,591 1,568,355 23,064 1,649,010 1,577,693 1,577,693 71,317 4,948 76,265 135,682 76,265 211,947 |
Total funds 2020 £ 111,432 1,301,603 2,320 |
|---|---|---|---|
| 1,415,355 | |||
| 1,341,891 | |||
| 1,341,891 | |||
| 73,464 - |
|||
| 73,464 | |||
| 62,218 73,464 |
|||
| 135,682 |
The Statement of financial activities includes all gains and losses recognised in the year.
The notes on pages 15 to 27 form part of these financial statements.
Page 12
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee) REGISTERED NUMBER: 07649974
BALANCE SHEET AS AT 30 JUNE 2021
| Note Fixed assets Tangible assets 11 Current assets Debtors 12 Cash at bank and in hand Creditors: amounts falling due within one year 13 Net current liabilities / assets Total assets less current liabilities Creditors: amounts falling due after more than one year 14 Total net assets Charity funds Restricted funds 15 Unrestricted funds 15 Total funds |
86,333 1,037 87,370 (120,330) |
2021 £ 246,903 (32,960) 213,943 (1,996) 211,947 - 211,947 211,947 |
71,557 37,107 108,664 (85,145) |
2020 £ 120,145 23,519 143,664 (7,982) 135,682 - 135,682 135,682 |
|---|---|---|---|---|
The entity was entitled to exemption from audit under section 477 of the Companies Act 2006.
The members have not required the entity to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
However, an audit is required in accordance with section 144 of the Charities Act 2011.
The Trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements.
The financial statements have been prepared in accordance with the provisions applicable to entities subject to the small companies regime.
The financial statements were approved and authorised for issue by the Trustees on 27 April 2022 and signed on their behalf by:
Gerhard Schulz
The notes on pages 15 to 27 form part of these financial statements.
Page 13
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2021
| Cash flows from operating activities Net cash used in operating activities Cash flows from investing activities Purchase of intangible assets Net cash used in investing activities Cash flows from financing activities Cash inflows from new borrowing Repayments of borrowing New finance leases Repayments of finance leases Receipt of insurance claim 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 |
2021 £ 101,162 (170,763) (170,763) - (34,270) - (5,986) 9,590 (30,666) (100,267) 37,107 (63,160) |
2020 £ 95,511 (49,109) (49,109) 21,270 - 17,959 (6,074) - 33,155 79,557 (42,450) 37,107 |
|---|---|---|
The notes on pages 15 to 27 form part of these financial statements
Page 14
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
1. Accounting policies
1.1 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.
The Carpenter's Arms (Midlands) Trust meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy.
1.2 Income
All income is recognised once the Company has entitlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably.
Grants are included in the statement of financial activities on a receivable basis. The balance of income received for specific purposes but not expended during the period is shown in the relevant funds on the balance sheet. Where income is received in advance of entitlement of receipt, its recognition is deferred and included in creditors as deferred income. Where entitlement occurs before income is received, the income is accrued.
Other income is recognised in the period in which it is receivable and to the extent the goods have been provided or on completion of the service.
1.3 Expenditure
Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges allocated on the portion of the asset’s use.
Expenditure on charitable activities is incurred on directly undertaking the activities which further the Company's objectives, as well as any associated support costs.
Grants payable are charged in the year when the offer is made except in those cases where the offer is conditional, such grants being recognised as expenditure when the conditions attaching are fulfilled. Grants offered subject to conditions which have not been met at the year end are noted as a commitment, but not accrued as expenditure.
All expenditure is inclusive of irrecoverable VAT.
Page 15
THE CARPENTER'S ARMS (MIDLANDS) TRUST (A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
1. Accounting policies (continued)
1.4 Tangible fixed assets and depreciation
Tangible fixed assets costing £500 or more are capitalised and recognised when future economic benefits are probable and the cost or value of the asset can be measured reliably.
Tangible fixed assets are initially recognised at cost. After recognition, under the cost model, tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. All costs incurred to bring a tangible fixed asset into its intended working condition should be included in the measurement of cost.
Depreciation is charged so as to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives, using the straight-line and reducing balance methods.
Depreciation is provided on the following bases:
- Short-term leasehold property 10% straight line - Plant and machinery 20% reducing balance Motor vehicles - 20% reducing balance - Computer equipment 33% straight line
1.5 Debtors
Trade and other debtors are recognised at the settlement amount after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.
1.6 Cash at bank and in hand
Cash at bank and in hand includes cash and short-term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.
1.7 Liabilities and provisions
Liabilities 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.
Liabilities are recognised at the amount that the Company anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide.
Provisions are measured at the best estimate of the amounts required to settle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised in the statement of financial activities as a finance cost.
1.8 Financial instruments
The Company only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.
Page 16
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
1. Accounting policies (continued)
1.9 Finance leases and hire purchase
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the Company. Obligations under such agreements are included in creditors, net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the statement of financial activities so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
1.10 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.
1.11 Fund accounting
General funds are unrestricted funds which are available for use at the discretion of the Trustees in furtherance of the general objectives of the Company and which have not been designated for other purposes.
2. Income from donations and legacies
| Unrestricted funds 2021 £ Donations 32,631 Grants 24,960 57,591 Total 2020 111,432 |
Total funds 2021 £ 32,631 24,960 57,591 111,432 |
Total funds 2020 £ 46,696 64,736 |
|---|---|---|
| 111,432 | ||
Page 17
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
3. Income from charitable activities
| Unrestricted funds 2021 £ Housing and other benefits 1,568,355 Total 2020 1,301,603 |
Total funds 2021 £ 1,568,355 1,301,603 |
Total funds 2020 £ 1,301,603 |
|---|---|---|
4. Other incoming resources
| Other income Total 2020 Analysis of grants Grants Total 2020 |
Unrestricted funds 2021 £ 23,064 2,320 Grants to Institutions 2021 £ 26,094 877 |
Total funds 2021 £ 23,064 2,320 Total funds 2021 £ 26,094 877 |
Total funds 2020 £ 2,320 |
|---|---|---|---|
| Total funds 2020 £ 877 |
|||
5. Analysis of grants
Page 18
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
6. Analysis of expenditure on charitable activities
Summary by fund type
| Unrestricted funds 2021 £ Costs of charitable activities 1,577,693 Total 2020 1,341,891 |
Total funds 2021 £ 1,577,693 1,341,891 |
Total funds 2020 £ 1,341,891 |
|---|---|---|
Page 19
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
7. Analysis of expenditure by activities
| Costs of charitable activities Total 2020 |
Activities undertaken directly 2021 £ 1,551,599 1,341,014 |
Grant funding of activities 2021 £ 26,094 877 |
Total funds 2021 £ 1,577,693 1,341,891 |
Total funds 2020 £ 1,341,891 |
|---|---|---|---|---|
Analysis of direct costs
| Staff costs Depreciation Rent and rates Heat and light Maintenance and cleaning Equipment and repairs Residents costs Telephone and mobile Printing, post and stationery Insurance Vehicle costs Travel Staff expenses Professional fees Bank and finance charges Sundry Governance costs |
Total funds 2021 £ 834,428 39,363 265,070 78,256 62,524 11,460 87,893 18,982 21,022 37,096 23,143 7,649 15,802 41,926 1,946 - 5,039 1,551,599 |
Total funds 2020 £ 777,357 25,301 181,988 64,722 50,512 4,391 80,719 16,097 17,123 31,763 31,748 2,629 6,476 42,272 2,741 255 4,920 |
|---|---|---|
| 1,341,014 |
8. Auditors' remuneration
- The auditors' remuneration amounts to an auditor fee of £3,000 (2020 £3,000) , and preparation of statutory accounts of £1,200 ( 2020 - £1,200 ).
Page 20
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
9. Staff costs
| Wages and salaries Social security costs Contribution to defined contribution pension schemes |
2021 £ 756,136 56,970 21,322 834,428 |
2020 £ 709,003 48,291 20,063 |
|---|---|---|
| 777,357 |
The average number of persons employed by the Company during the year was as follows:
| 2021 | 2020 | |
|---|---|---|
| No. | No. | |
| Employees | 56 | 43 |
No employee received remuneration amounting to more than £60,000 in either year.
10. Trustees' remuneration and expenses
During the year, one or more Trustees has been paid remuneration or has received other benefits from an employment with the Company. The Company is permitted to remunerate trustees in accordance with article 6(4)9B)(a) of the Articles of Association. The value of Trustees' remuneration and other benefits (see also note 24) was as follows:
| 2021 | 2020 | ||
|---|---|---|---|
| £ | £ | ||
| Bryan Spence | Remuneration | 46,800 | 32,533 |
| Pension contributions paid | 1,404 | 976 | |
| Other benefits | 472 | - | |
| Judith Spence | Remuneration | 46,800 | 32,533 |
| Pension contributions paid | 1,404 | 976 | |
| Other benefits | 624 | - |
During the year ended 30 June 2021, expenses totalling £ 1,612 were reimbursed or paid directly to 4 Trustees (2020 - £5,996 to 4 Trustees) . The reimbursed expenses were for travel £823 (2020: £2,944) and food supplies and consumables for residents £789 (2020: £3,052).
Page 21
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
11. Tangible fixed assets
| Cost or valuation At 1 July 2020 Additions Disposals At 30 June 2021 Depreciation At 1 July 2020 Charge for the year On disposals At 30 June 2021 Net book value At 30 June 2021 At 30 June 2020 |
Short-term leasehold property £ 97,334 150,038 - 247,372 24,377 24,738 - 49,115 198,257 72,957 |
Plant and machinery £ 24,056 19,297 - 43,353 17,090 5,252 - 22,342 21,011 6,966 |
Motor vehicles £ 93,513 - (15,023) 78,490 53,291 8,897 (10,381) 51,807 26,683 40,222 |
Computer equipment £ 3,526 1,428 - 4,954 3,526 476 - 4,002 952 - |
Total £ 218,429 170,763 (15,023) |
|---|---|---|---|---|---|
| 374,169 | |||||
| 98,284 39,363 (10,381) |
|||||
| 127,266 | |||||
| 246,903 | |||||
| 120,145 |
The short-term leasehold property costs relate to the premises Six Hills, Fosse Way, Melton Mowbray, Leicestershire, LE14 3PD. Under the terms of the lease the charity had an option to purchase which it exercised subsequent to the year end. The purchase of the Six Hills property for £1,170,000 was completed on 12 April 2022 with mortgages amounting to £1,347,440 secured on the both the property and those owned by the related charity, Homes for the Homeless (Leicestershire) Ltd.
12. Debtors
| Due within one year Trade debtors Other debtors Prepayments and accrued income |
2021 £ 42,649 15,779 27,905 86,333 |
2020 £ 34,748 16,442 20,367 71,557 |
|---|---|---|
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THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
13. Creditors: Amounts falling due within one year
| Bank overdrafts Other loans Trade creditors Other taxation and social security Obligations under finance lease and hire purchase contracts Pension contributions due Other creditors Accruals and deferred income 14. Creditors: Amounts falling due after more than one year Net obligations under finance lease and hire purchase contracts |
2021 £ 64,197 27,000 14,720 580 5,986 3,047 - 4,800 120,330 2021 £ 1,996 |
2020 £ - 40,000 1,908 7,764 5,986 3,417 21,270 4,800 |
|---|---|---|
| 85,145 | ||
| 2020 £ 7,982 |
Page 23
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
15. Statement of funds
Statement of funds - current year
| Balance at | |||||
|---|---|---|---|---|---|
| Balance at 1 | Gains/ | 30 June | |||
| July 2020 | Income | Expenditure | (Losses) | 2021 | |
| £ | £ | £ | £ | £ | |
| Unrestricted funds | |||||
| General Funds | 135,682 | 1,649,010 | (1,577,693) | 4,948 | 211,947 |
| Statement of funds - prior year | |||||
| Balance at | |||||
| Balance at | 30 June | ||||
| 1 July 2019 | Income | Expenditure | 2020 | ||
| £ | £ | £ | £ | ||
| Unrestricted funds | |||||
| General Funds | 62,218 | 1,415,355 | (1,341,891) | 135,682 |
16. Summary of funds
Summary of funds - current year
| General funds | Balance at 1 July 2020 £ 135,682 |
Income £ 1,649,010 Balance at 1 July 2019 £ 62,218 |
Expenditure £ (1,577,693) Income £ 1,415,355 |
Gains/ (Losses) £ 4,948 Expenditure £ (1,341,891) |
Balance at 30 June 2021 £ 211,947 |
|---|---|---|---|---|---|
| Balance at 30 June 2020 £ 135,682 |
|||||
| Summary of funds - prior year | |||||
| General funds |
Page 24
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
17. Analysis of net assets between funds
Analysis of net assets between funds - current year
| Unrestricted funds 2021 £ Tangible fixed assets 246,903 Current assets 87,370 Creditors due within one year (120,330) Creditors due in more than one year (1,996) Total 211,947 |
Total funds 2021 £ 246,903 87,370 (120,330) (1,996) 211,947 |
|---|---|
Analysis of net assets between funds - prior year
| Tangible fixed assets Current assets Creditors due within one year Creditors due in more than one year Total |
Unrestricted funds 2020 £ 120,145 108,664 (85,145) (7,982) 135,682 |
Total funds 2020 £ 120,145 108,664 (85,145) (7,982) 135,682 |
|---|---|---|
Page 25
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
18. Reconciliation of net movement in funds to net cash flow from operating activities
| Net income for the year (as per Statement of Financial Activities) Adjustments for: Depreciation charges Decrease/(increase) in debtors Increase/(decrease) in creditors Net cash provided by operating activities 19. Analysis of cash and cash equivalents Cash in hand Overdraft facility repayable on demand Total cash and cash equivalents 20. Analysis of changes in net debt At 1 July 2020 £ Cash at bank and in hand 37,107 Bank overdrafts repayable on demand - Debt due within 1 year (43,417) Finance leases (13,968) (20,278) |
2021 £ 71,317 39,363 (14,776) 5,258 101,162 2021 £ 1,037 (64,197) (63,160) Cash flows £ (36,070) (64,197) 13,370 5,986 (80,911) |
2020 £ 73,464 25,301 3,590 (6,844) 95,511 2020 £ 37,107 - 37,107 At 30 June 2021 £ 1,037 (64,197) (30,047) (7,982) (101,189) |
|---|---|---|
Page 26
THE CARPENTER'S ARMS (MIDLANDS) TRUST
(A company limited by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021
21. Pension commitments
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £21,322 (2020 - £20,063). Contributions totalling £3,047 (2020 - £3,417) were payable to the fund at the balance sheet date and are included in creditors.
22. Operating lease commitments
At 30 June 2021 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 |
2021 £ 124,250 59,833 184,083 |
2020 £ 75,000 56,250 |
|---|---|---|
| 131,250 |
23. Related party transactions
The charity is connected to two other charities through a majority of trustees in common:
-
B Spence, A Golba, S Day, G Schulz and J Spence are trustees of Homes for the Homeless (Leicestershire) Ltd.
-
J Penberthy and J Spence are trustees of Four Twelve Ministries.
As at the balance sheet date the charity was owed £NIL by Four Twelve Ministries (2020 - £NIL) and owed £Nil to Homes for the Homeless (Leicestershire) Ltd (2020 - £21,270).
The son of Mr & Mrs B Spence, trustees, is an employee of the charity and received remuneration amounting to £47,514 (2020 - £29,733) and benefits in kind by way of pension payments amounting to £1,425 (2020 - £892). Expenses amounting to £15,435 (2020: £938) were reimbursed to him during the year.
A company owned by a trustee, Mr G Schulz, provided accounting and professional services during the year amounting to £6,065. In the year to 2020 Mr Schulz was not a trustee.
Page 27