# 2021-2022 ANNUALREPORT & FINANCIAL STATUS
**WWW.THEHABBITFACTORY.ORG CHARITY NUMBER - 1162418**
## Contents
|**Reference and Administrative Details**|Page|
|---|---|
|**Chairman's summary**|1|
|**The Organisation**
Legal Structure & Objects|2|
|Governance|3|
|Management||
|Risk Assessment|4|
|Reserves Policy||
|**Chief Executives Annual Report**||
|Overview|5|
|A year - What a difference||
|Strategy's employed to achieve Charity's aims and Objectives|6|
|1.Performances|7|
|2.Membership Programme||
|3.Education & Outreach Programme
4.Volunteer Programme|8|
|5.Fundraising||
|6.Future plans|9|
|**2021-2022**
**Financial Report**
Treasurers report|10|
|Draft accounts. (The final accounts are currently being prepared and||
|**ANNUALREPORT &**
will be subject to external audit)||
|**FINANCIAL STATUS**||
## Chairman's Summary
Just before I sat down to type this, I re-read last year's Chair report from my predecessor, Tony Dance, to compare the outlook of The Habbit Factory then versus the present day. As you may imagine, times were tough having been hit by the pandemic, just as they were for the whole charity sector. We encountered financial and organisational difficulties and had to be creative to keep connected with everyone involved in our organisation. Despite doing our best at the time, we were left with the challenge of rebuilding our charity.
I'm pleased to say this year we find ourselves in a very different place. What a difference a year makes…
As the new board embedded into The Habbit Factory in April 2021, we were keen to ensure we didn't get in the way of Lee. His passion and drive towards improving the charity means that our role is largely one of support and empowerment. Lee, working in tandem with Adam Gallacher (our organisation development consultant), took us huge leaps forward in fundraising, financial planning and governance - to name just three areas amongst many. As a result, we find our charity back in a sustainable position to do what we do best; facilitate creative expression for all. I am excited to see the culmination of this in only a month's time as we showcase our first live performance in three years.
Having recovered from the pandemic, we're now in a position to expand our reach and improve our offer. We've done so this year by welcoming our newly founded infant group and Hannah Jolley, our new SEN Inclusion Officer. Rest assured, as we continue to grow, our focus will always be on our existing members. This year we also had the pleasure of welcoming Kelly, who is covering Hannah Salmon’s maternity leave, and babies Beau and Gus, the new additions to the families of Lee and Hannah respectively. **2021-2022**
Thank you to our incredible team, volunteers, members, board and everyone reading this Annual Report. You are all a hugely valuable part of our community and contribute to what makes this charity so special. I look forward to meeting many of **ANNUALREPORT &** you at our upcoming performance.
## **FINANCIAL STATUS**
1
## **LEGAL STRUCTURE**
Board of Trustees: Robert Lithgow (Chair) Tim Steel (Treasurer) Carron Beckwith (Secretary) Cleonah Springer-Clarke Georgina Hart Guleraana Mir Kieran O'Callaghan Owen Smith
Executive Officer: Lee Giles (Artistic Director and CEO)
Registered Office: 3a Grange Road Romford Essex RM3 7DU
Registered Charity: 1162418
Bankers: 120 - 122 High St, Hornchurch Essex RM12 4UL
Auditors: Fox Accountancy 144 Hall Ln, Upminster RM14 1AT
2
## The Organisation
The Habbit Factory is an inclusive arts organisation in The London Borough of Havering. Welcoming all, and working with some of the most excluded and disadvantaged children, young people and adults in the area but not exclusively. Through a targeted network of partners, our work helps people who do not see themselves as artists or have access to any creative engagement or provision.
## **Legal Structure & Objects**
The Habbit Factory is a registered charity. Members of the Board act as Trustees and Directors of the charity. The overall objects and powers of the Trust are set out in our written constitution. The object for which the company is established is the advancement of education in the fields of the arts, principally to advance the education of children and young people in all aspects of the performing arts through the provision of workshops and opportunities to participate in artistic performances.
## **Governance**
The Board of Directors has full legal responsibility for the corporate governance of the The Habbit Factory. Directors/Trustees are required to act in accordance with the company's constitution. Directors are appointed on the basis of specific skills and knowledge to enable them to make a contribution to the management of the company. In order to understand their role and current issues facing the organisation, each new Director is provided with specific tailored information, including; copies of Governing Documents, Board Minutes, Annual Accounts. Opportunities are provided for new Directors to engage with the Chairman and Executive Director, as well as meeting with staff working within their own area of specialism. The Board meet quarterly and review cross-organisation performance and development. Finance is the responsibility of the Finance Committee, which in the year to 31 March 2020, consisted of the Chair, Treasurer, and Executive Director. It oversees the development of business plans and recommends the Annual Budget to the Board. It reviews progress through the management account and re-forecasting process, tightly monitors overheads and exerts rigorous control over all outlays. Being responsible for monitoring income delivery is an essential part of the discussions of the Finance Committee.
## **Management**
The operational running of the theatre company is delegated to the Executive Director. managing operations of the company, assessing progress against artistic, education and business plans. Communication within the company, and to the wider Habbit Factory community, is facilitated through face-to-face briefings (including staff and volunteer meetings), complemented by communications via email. It is important to document that the Habbit Factory's boasts a strong voluntary team who are vital to our work.
3
## The Organisation
## **Risk Assessment**
Systems of internal control within the Trust are designed to provide reasonable reassurance against material mis-statement or loss. These include:
- Strategic and operational plans and an annual budget Consideration of financial and non-financial results on a regular basis Identification and management of risks
The Board has overall responsibility for ensuring that risk is managed in a constructive and considered manner and judge that the systems currently established mitigate the major risks identified and are appropriate for the present size of the charity. The most significant risks affecting the Charity are liquidity and cash flow risk. The Finance Committee continues to monitor this aspect of the company's operations on behalf of the directors through review of management accounts and re-forecasting, particularly in relation to income.
## **Reserves Policy**
The Charity continues its commitment to build meaningful reserves. After diving into our reserves, due to the pandemic, we are now looking at ways to rebuild so that the Charity can meet unexpected shortfalls or cash flow difficulties. In the longer-term the Directors would wish to establish reserves of six months cover.
## **Financial report**
Page 10 details our draft accounts and report from the Treasurer. The final accounts are currently being prepared and will be subject to external audit.
4
## Chief Executive Report
Founded in 2004, The Habbit Factory's vision is for **creative expression for all** no matter of background, ability or affluence.
Working within the London Borough of Havering, our approach is built on the principles of inclusivity, which welcomes **everyone** . As the only organisation that supports disability arts in the borough and through a targeted network of partners; we are able to connect with individuals who often get overlooked within the community.
We do this because we believe art has the power to effect change. Evidence continues to suggest that the creative arts is one of the most powerful tools to bring people together, breaking down social and cultural barriers, whilst helping the most vulnerable to lead a fulfilling and dignified life.
Through programmes and activities facilitating education, theatre, participation, and professional training, The Habbit Factory breaks down barriers to inclusion and transforms wellbeing.
The Habbit Factory works with children and young people from ages 3 and above and adults of all ages. Our inclusive ethos means we welcome people from diverse backgrounds, and our community is made up of people from across all of society, including those experiencing social exclusion in mainstream environments for whom we provide additional support. These potential barriers to participation include: socio economic disadvantages, learning disabilities physical disabilities; illness and long-term medical conditions; sensory impairments; abuse and neglect; behavioural difficulties; mental health issues; being in the care system; and having caring responsibilities.
5
## Chief Executive report (continued)
## **A year - What a difference**
As a result of the impact of the COVID-19 pandemic, from March 2020 all of our services were closed until April 2021. Whilst the effects of the pandemic have been devastating to all it gave us time to re-evaluate the organisations core programmes, finances, board and beneficiaries. Since then The Habbit Factory has embraced a development strategy, supported initially by an Arts Council England Grant (ACE) which we received also in April 2021.
## **New Board**
With our founding board nearing their 8th year, 7/8 of the board members decided to step down in March 2021 leaving a fantastic new opportunity to recruit new trustees to support the developments. As well as covering individual areas such as fundraising, finance, legal etc, we were keen on representing our beneficiaries through our board. A year on into their tenure we now have specific roles delegated to board members leaning on their professional and personal experiences to enhance the organisations work and keep up with the governance of an ever growing charity.
## **Organisational development**
This word will forever be engrained in my mind. In my opinion no organisation should ever stop thinking about it! Through the grant we were able to bring in the knowledge and experience of development consultant Adam Gallacher. Since May 2022 him and I have looked at every area of the organisation, such as:
- Financial planning
- Strategic planning
- Core team
- Volunteering
- Programmes
- Fundraising - Including grant applications
- Income generation
- Risk register
- The organisations goals, mission and vision
- Theory of change
## **Core team**
This year has proved tough for the core team. With Hannah (choreographer) on maternity from October 2021 we were seeking cover. We welcomed a new creative, Kelly who since has become a vital part of the core team.
Through my work with Adam it became apparent that we needed more staff to support our current Membership cohort. In January we recruited another Hannah (H) as our SEN Inclusion Officer to support our volunteer programme, and the administration behind our membership programme.
Adam has also become a part of the core team. After the grant from ACE had finished, the board and I decided to lean on Adam's services until March 2022 to continue the work we have taken on.
6
## Chief Executive report (continued)
## **Strategies employed to achieve the charity's aims and objectives**
In pursuit of our charitable aims we have continued to reach our beneficiaries through focusing our work in the key strategic areas of Performances, Education & Outreach, Membership, volunteering and fundraising. Key activities and achievements are detailed below.
## **Performances**
The Habbit Factory offers, through its Membership programme, opportunities for children, young people and adult members to co-create theatre alongside our professional artistic staff, thus developing essential transferable skills for the future. During 2020-2021, our performance programme became online performances only. However, from September 2021 our newly found Infant group, along with our Junior and Senior group began the research & development of our next large scale production - The Last Resort. To be performed at the Queens Theatre in July 2022. The Last Resort tackling themes on climate change.
Our adults group are rehearsing 'Hallows Eve'. A production which they had prepared before the pandemic. This will be shown at the Myplace Centre in October.
Pantomime! Our annual Pantomime is back this year. We looked at the project from previous years and wanted to enhance it. This year we will be offering performance opportunities to our children's groups to perform alongside professional staff and volunteers. Thus creating a larger, inclusive cast. Every performance will be made to be a relaxed performance to ensure everyone from the community can access the performance regardless of their needs. The Pantomime will be 'Jack and the Beanstalk' and will be performed in December 2022.
We will continue to use performances to showcase our work, tackle inequalities and highlight our truly inclusive approach.
## **Membership Programme**
We re-opened our workshops from the pandemic in April 2021. Our artistic practise has always been to co-create with our young people but following a programme review we really wanted to hand the productions development to our Membership programme. Whether it be Infants, Juniors, Seniors or Adults Members, they are in control. This has lead to a positive review from Members and families alike with one child stating "I really feel like this is my show".
Within strategy development the core team and volunteers have been embedded through structures supporting the active contribution of Members in the creative decision making; a long term goal will see the introduction of a youth forum where Members thoughts and feeling will influence perspective at board meetings, regular strategy exploration sessions between Executives and Members representatives.
Key partnerships were developed this year with the Queens Theatre, the Myplace Centre, Rainham Royals Centre to continue workshops and performances with a greater emphasis on our young people.
7
## Chief Executive report (continued)
Between April 2021 and March 2022 our Membership programme worked with a total 217 beneficiaries. Of these, 87 identified as having an additional support need or were at risk within their community.
## **Education and Outreach Programme**
The Habbit Factory's Education and Outreach programme took on a huge overhaul during the pandemic including research into why we do it?
## **History**
In 2011, as our work with young people became increasingly recognised and championed, we were approached by several schools to support pupils exhibiting challenging behaviour and struggling to control and regulate their emotions. Our approach was different – a commitment to inclusivity meant bringing everyone together, bridging the divides and challenging stigma to understand and value the person. Promoting teamwork is at the heart of our work.
This led to the development of our Educational Programme – a partnership with 3 schools - a co-created drama model to support pupils who are struggling to find their place in the world, giving them agency to effect change in their life. The Habbit Factory has now expanded into different areas of the borough to deliver targeted a provision in some of the UK’s most deprived schools. Many of the participants in this programme go on to our Membership programme where we offer a more longer-term provision outside of their school.
To date, we now run 7 regular Educational workshops in schools on a weekly basis and have began to work with other schools, Broadford, Elm Park Primary and newly found charity partners FIG. Teachers and charity leaders praise our work, one stating that we managed to 'Bring alive' one of her students who was struggling to access the curriculum without our practical approach.
Between April 2021 and March 2022 our Education and Outreach programme worked with roughly 670 children aged between year 2 - year 6.
## **Volunteer Programme**
In 2021/22, 27 volunteers (Our Blue Tees) gave an estimated total of approximately 271 hours to The Habbit Factory. (This excludes hours given voluntarily by members of staff, families, trustees and membership.) When multiplied by the London Living Wage (£11.05/hr), an estimated minimum monetary value of £2,994 can be attributed to this service. In accordance with FRS102 and the Charities SORP (FRS 102), the economic contribution of volunteers is not recognised in the accounts. Volunteers support us across many areas of our work and are at the heart of the Habbit Factory community. The financial contribution of our Trustees was not calculated. The contribution of our volunteers is immeasurable beyond the hours they give, their energy, enthusiasm, dedication and goodwill are vital to The Habbit Factory. Our volunteers are a precious resource and enable us to deliver our programmes and activities for young people. We are truly indebted to them.
8
## Chief Executive report (continued)
## **Fundraising**
The Habbit Factory generates revenue through earned income from its charitable activities (performance receipts, membership subscriptions, education tuition and support fees).
Whilst working with Adam we recognised to sustain the organisation a fundraising overhaul was needed. Never before had we received funding grants and to support the growth and development we would need to change this instantly. We managed to gain the funds from ACE to go through developments but these funds would all be spent on the development project with no surplus. We then looked at the theory of change which supported us with writing our first grant to the Backstage Trust who supported us with an unrestricted £10,000.
Further applications to Charles S French and National Lottery secured funds to allow us to bring in another core team member who supports our Volunteering Programme and Membership Programme.
We have launched a Factory Friends scheme to search for individuals to support with donations regularly between £5-£15 monthly. This didn't land as well as we had hoped with 2 individuals supporting monthly.
Overall our fundraised income has risen from the previous year from £4203 - around 40k (figure tbc. An increase of 1005%.
Efforts to continue fundraising will only support The Habbit Factory's future growth. We would like to thank all of our donors throughout the year.
## **Future plans**
With the new boards feet firmly under the table and the organisations cash flow under control it is now time to start thinking about the future. By April 2023 we will produce a 3 year strategic plan including aims and objectives for each of our programmes. Whilst reaching further into the community is, and will always be vital. We want to ensure the connections we already have are made deeper therefore leaving a larger legacy on each individual that comes into contact with the organisation.
I cannot talk too deeply around aims and objectives but have bullet pointed some below:
- Increase the core teams capacity to support
- Increase volunteer experience and training
- Become a leading organisation within the inclusive arts world Enhance performance quality to bring in an outside audience To be representative of the local community
I'll finish where I started...a year - what a difference!
## Financials
## **Treasurer’s report**
Following my update at the AGM in the summer, the accounts for the year ended 31st March 2022 have been finalised and audited.
Over the past financial year our focus has been both recovering the finances from losses in the past two years, as well as supporting the charity’s growth referred to by the CEO above. I have included a summary of the previous 2 years’ accounts, which due to lockdowns had combined losses over £20,000. I am therefore extremely pleased to report that the charity not only covered all costs in the past financial year, but also made a surplus over £14,000. Whilst some of this surplus will be reinvested in 2022/3 for the benefit of our members, it is appropriate that we also rebuild the capital reserves of the The Habbit Factory to ensure that we have resilience which, along with the CEO and Board, we have progressed as part of our 2022/3 budgeting.
The accounts show a substantial increase in income. Most of this increase came from successful Grant applications as well as some individual donations. As reported by the CEO, the Board approved investment in external consulting support, Adam Gallacher. I am normally a little sceptical of consultants but I have no hesitation in reporting this Adam’s support has been extremely good value for money for our charity and his work with Lee has been a driving force behind most of the Grant awards, of course along with the many hours I know Lee put in himself.
The increase in staff costs is driven by formalising the current roles and the staff additions reported by CEO. Other expenses have not quite returned to 2020 levels but reflect that the charity’s activities were rebuilt during 2021.
Overall, the approach for this year has been to rebuild and strengthen the financial position of the charity, whilst also investing in people to support growth of the charity for our members. Looking forward, my focus with the CEO and Board will be to continue this approach, whilst ensuring that our cost base is flexible enough to cope with any unexpected events.
Finally, I must add my thanks to Angela Boodhun, our Finance officer, who has done the hard work reconciling all of the banking and spreadsheet work – I am extremely grateful!
Tim Steel ACMA CGMA Treasurer
10
(HARITY COMMISSION
FOR ENGLAND AND WALES
Independent examiner's report on the
accounts
Section A
Independent Examiner's Report
Report to the Irusteesl
member8 of
The Habbit Factiyy
On accounts for thè yèar
ended
31 March 2022
Charty no
(rfary
1162418
Set out on pag08
As per the attached accoints
I report to the trustees c my examinat'on of the acccunts of the 2J)ove
thanty {'Ihe Trust") fr the year end&J 31• March 3J21.
R08pon8ibililie8 and As the ch'ty'S trustees. yw are respons'ble for Ihe preparats'on of the
ba818 of report accwnts in accdance with the requiremlS of the charikn.es Act 2011
{'the Ad-).
I report In respect of my examlnation of the Trusl's accounts caled out
under secb'on 145 of the 2011 Act and in carying oul my examinaticn, I
have followed all Ihe applicpi)le Direcbons giv by tre Charity C(mmissi(
under section 145{5)Ibl of Ihe Act.
Independent I have completed my examination. I ccmfim) Ihat no material matters have
exam inefs statement come to my attents'on In clneC110n with the examination which gives me
cause to belIe that in any material resp1..
Ihe aCcotIng records we not kept in accordan with section 130
ofthe Charities Act. or
Ihe acco15 did not aC1)rd with Ihe aCtlnting records,. or
Ihe accoLnts did not comply with the applicable reqUireMts
Jnceming 1he fonn and content of accounts set out In the Charities
(Accounls and Rep$) Regulats'ons 2008 other than any requiremenl
Ihat the accounts give a'true and fair. view whith is not a matter
considerèj as pwt of an indq)endent examinat'ffi.
I have no concems and have come acfOSS no other matters in c¢J)necli(
with the examinab'on to whith attention thould be drawn in this repcrt in
order to enae a woper UnderstdIng of the accounts to be reathed.
SSgned:
Dato:
Ttsrd Cecember 2022
Name:
Kaan Fehmi
Relevant professional
qualrfication{s)'
ACMA. CGMA
Addre88:
Qyalls Hwse, Auc*land Trive, Sittingboume. Kt ME10 1HN
The Habbit Factory
Unaudited Accounls
31 March 2022
Re8iStered Charity Number:
1162418
Tho Habbit Faclory
Busin888 Inforniation
Trustees
Kieran o'caiagh
Robert Lrthgow lappoknted 1 April 2021)
carr BethN¥rth lapp¢Jrted 1 April 2021 }
Guleraana Mir {appcrfnted 1 April 2021)
Georgina Hart (apPnIell 1 April 20211
Owen Smith (apPnted 1 Aprl 2021)
Tim Steel l¥*pointed 1 Aprl 20211
Tony Dan¢e (resigned 1 May 2021)
Teresa Orpin (resigned 1 May 2021
Suzanne Giles Ireggned 1 May 2021)
Barry Malcomber In0eXeCuti trustee) Iresiwed 1 May 2021)
Sean Wade Iregwed 1 May 20211
Cleonah Sprirwjer-clarke {appanted 27 May 1121 >
Accounlanls
Fox Accountancy timiled
144 Hall Lane
Upminst
Essex
RM144AT
Bankers
Nalwest
Hornchurch Branch
1201122 High Street
Hornchurch Branch
Essex
RM124UL
R•gist•r•d Ch¥ity a(ktr•ss
3a Grange Road
Romford
Essex
RM3 7DU
The Habbit Factory
)proval statement
We approve the acccunts c(¥nprise of the Profit and Loss Account. the Balance Sheet and the
related notes. We acknchvledge OLY respcmsbil'ty for the accounts. induding the appropriateness of the
applicable financial reporting framev*vrk as set in nde 1. and for pr¢Mding Fox Accountancy
Linrted with al information and eyplanations necessary for their cunpilation.
Tirn Steel (Treasurer)
Robert Lithgo4V (Chakl
Date: Xlh N¢N 2022
The Habbil Factory
Profit and Loss Account
for the year ended 31 March 2022
21Y22
2021 '
In¢om
Trusts and Foundation grants
Member pr(>Jramme donatlons
Educational programme fees
Corporate & Individual giving
Summer workshops
Tickets, events and challenges
Irbdividual giving
Ban k interest
40,977
15.659
8.310
3,921
1,700
1.882
9.S67
n,450
9.571
ExperKlSturo
staffing and consultancy
Venue hire & expenses
Equipment, insurance & overheads
Performance costs
47.259
5,653
3,705
1.H7
58,C64
14,6(M)
155
1,791
16,546
Swplus
'. The headlngs have be upd*ed In 2022. see n¢Xe 2 fc* m¥pi)g of 2021.
Tho Habbit Faclory
Balance Shoot
as al 31 March 2022
Registered Charity Number: 1162418
2022
2021
Assets
Trade deblus
BankknLMlding society balances
Cash In hand (Petty cash)
28,152
11,746
20
11,786
28,152
Lirl)iliti
Trade creditors
28,152
11,766
Not buslnoss 4S5•ts r•prWJrrt by
Capital •¢ccwrt'.
Balance at start of perlod
Net surp9
11,788
14,386
18,741
18,975)
26,152
11,766
SuryAus funds
Restricted expenthlure
Unrestricled expendrture
12,5OJ
13,652
1,762
10,C04
,152
11,766
The Habbil Factory
Nolas to the Accounts
for the year ended 31 March 2022
1 Accounting basis
The accounts have been ¢unpld on an accwals basis that enables profits to be calculated in
aCCdCe wth the promsicms of FRS 102 that pr¢Nides suffiaenl and releant informati
to enable the completion of a tax retum.
2 ACCntIng basls
The headlngs wthin kneome and expenses ha been updated kn 2(r22. The mapping ft* the
2021 is as follNs-.
2021
Upd•tèd hIding
2021 h•athng
vtary subptIOnS
DonathS
1.009
8.558
9,567
Member programme donations
Management and dwdq)ment
14.6fX+
14,6
Staffing and consultancy
Hal rertal
155
Venue hire & expenses
EqUVmt expenses
Prinlkng, poslage and stallonery
Telephone
Le91{1e$
Sub%riptw)ns
Stage
24
743
183
57
691
1,791
Equipment. insurance & overheads
Tho Habbit Faclory
Summary Profit and Loss Account
for Ihe year ended 31 March 2022
This 6chodule d008 not forn) part of th8 8tatutory accounts.
TNsts and R)undation grants
Member programme donati¢Jns
Educational projramme fees
Corporate & Individual giving
Summer workshops
Tickets, events and challenges
Individual giving
Bank interest
40.977
15.659
8.310
3.921
1,71))
1,882
9,567
24,295
6,876
1,100
1.147
ota
Income
Staffing and consultancy
Venue hire & expenses
Equipment. insurance & overheads
Performance costs
47.259
5,653
3.705
1.447
14,6Q)
155
1.791
27,748
11,034
6,455
2.476
ota
ro
on actNrtI
Th8 Habbit Factory
Summary Balance Sh88t
for lh8 year 8nd8d 31 March 2022
Thi8 8ch8dule d008 not form part of the 8tstutory accounts.
Trade debtors
Banklbuilding society balances
Cash in hand (Petty Cash)
26,152
11,746
20
19,588
£ 26,152
£ 11,766
£ 22,008
Trade CreJJitors
3,268
3, 268
N•t a•••ts
L4
ital account..
Balance at start of period
Net surplus (deficlt)
11,766
14,386
18,741
16,9751
33,002
114,2611
£ 26,152
£ 11,766
£ 18741
Restricted expenditure
Unrestrlcted expenditure
12,5iX)
13,652
1,762
10,004
18,741
£26152
£ 18741