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2021-05-31-accounts

REGISTERED COMPANY NUMBER: 08084979 (England and Wales) REGISTERED CHARITY NUMBER: 1162937

TRUSTEES' REPORT AND

UNAUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2021

FOR

HAPPY CHILDREN LTD

Riley Moss 2018 Limited Riley House 183-185 North Road Preston Lancashire PR1 1YQ

HAPPY CHILDREN LTD

CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2021

Page
Reference and Administrative Details 1
Trustees' Report 2 to 5
Independent Examiner's Report 6
Statement of Financial Activities 7
Balance Sheet 8
Notes to the Financial Statements 9 to 15
Detailed Statement of Financial Activities 16 to 17

HAPPY CHILDREN LTD

REFERENCE AND ADMINISTRATIVE DETAILS FOR THE YEAR ENDED 31 MAY 2021

Trustees Faiza Akram Saeeda Aslam (director registered at Companies House only) Sabiya Aslam Nagebah Hayel Muckbel Osi-Efa Registered office St Mary's Hall Northdale Road Liverpool L15 4HT Registered company number 08084979 (England and Wales) Registered charity number 1162937 Independent examiner Riley Moss 2018 Limited Riley House 183-185 North Road Preston Lancashire PR1 1YQ Bankers The Co-Operative Bank PLC Business Direct PO Box 250 Skelmersdale, WN8 6WT Al-Rayan Bank PLC PO Box 12461 Birmingham, B16 6AQ

Page 1

HAPPY CHILDREN LTD

TRUSTEES' REPORT FOR THE YEAR ENDED 31 MAY 2021

The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31 May 2021. The trustees have adopted the provisions of 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).

Objectives and activities Charitable Objects

The charity's objects are specifically restricted to the following: to provide education, care and development to pre-school age children and wider services to school age children e.g. after school and holiday clubs.

Additionally, an object is to encourage parents (and the wider local community) to recognise and support the needs of children as they develop from an educational, social, cultural and physical standpoint. The above will be delivered by:-

" Providing facilities and an appropriately qualified staffing complement to enable play, education and care for children (in particular vulnerable children) via training and support to parents enabling them to become fully involved and responsible in their child's activities".

" Such services, activities and development will be available to all children regardless of race, culture, faith or disability".

" Providing facilities, services and support to families and the wider community in order that such individuals / groups can become actively engaged in the delivery of child(ren's) needs".

Aims and intended impact

To provide education care and development to pre-school aged children and wider services to school age children e.g after school and holiday clubs. Additionally our objectives aim to encourage parents (and the wider local community) to recognize and support needs of children as they develop from an educational, social, cultural and physical stand point.

Public benefit

The primary purpose of the organization is to enhance the wellbeing and life chances of pre-school age children (in particular those children in disadvantage) regardless of race faith or disability. In support of this we will promote the education of the individual child needs to all those in direct contact (parents, carers) and the wider community within which the child is being brought up through its formative years.

Due to Covid-19 the nursery invested in separating entrances for the different age groups to mitigate spread of the virus between staff and children.

Public activities were minimised and children were taught the importance's of minimising risk of spreading germs. The nursery closed in the first lockdown for a whole term and reopened in September.

Page 2

HAPPY CHILDREN LTD

TRUSTEES' REPORT FOR THE YEAR ENDED 31 MAY 2021

Achievement and performance

Charitable activities

Due to Covid-19, activities were limited to stop the spread of the virus. The children's over all learning was not impacted and numbers of children attending the nursery were stable. The nursery has participated in a programme to improve communication and delivered some of the training to local assigned nurseries. We have had positive feedback from primary schools of former children that were in our care who have noticed that children that attended our nursery before being transferred to their schools enter into reception at an advanced level.

We continue to be part of a collaborative group of nurseries who are working together as a consortia to enhance professional development among our practitioners. This allows us to work together with other nurseries and learn from their good practice as well as disseminate our own good practice. It also helps us work closely with the local Liverpool authority's Quality Improvement Team (QIT).

The nursery has taken on an apprentice, supporting the employee to get back into employment after rising her children.

Financial review

Financial position

The nursery has seen a small reduction in both income and costs during the year. However, overall the nursery has an excess of income over expenditure in the year of £74,539. The nursery did have reserves brought forward of £426,627. At the end of the year the balance sheet is still showing a very healthy situation in that the nursery total funds of £501,166.

Incoming resources

The company received fees which amounted to income from the parents and from the city council by way of funding for the provision of the nursery. It also received an income from its new after-school provision for children between the ages of 4 - 7. The income from parents come in two forms either payment directly from the parents or by way of childcare vouchers from the parents employers. The fee income from the childcare vouchers is a tax efficient way for parents to receive their wages and pay for childcare as the vouchers are deducted before tax and national insurance.

Resources expended

The charity has tried to control its costs in the year but has rewarded the hard work and efforts of the staff. This has resulted in an increase in costs overall.

All trustees give of their time freely and no remuneration or expenses were paid in the year. No trustees or person connected with a trustee received any benefit from use of our childcare facilities in the year on more favourable terms than available to the general public.

Investment policy and objectives

The investment policy adopted by the trustees is to maintain a high standard of the assets of the Trust and implement a programme of continual development to optimise their use in line with the charity's objectives. In line with the nursery ethos and Islamic financing principles the nursery does not take loans that incur interest, the organisation aims to invest in a building through an outright cash payment some of our current profits will go towards the future purchase of a building.

Reserves policy

The trustees have established a policy whereby the unrestricted funds not committed or invested in tangible fixed assets, which are the free reserves of the charity, should be between three and six months of general (unrestricted) operating costs and the trustees consider that this policy provides sufficient funds to cover wages, redundancy, management, support and administration costs and unforeseen expenditure and to be able to continue the activities of the charity in the event of a significant drop in funding, or business interruption. The free reserves at the 31st May 2021 of £501,166 (2020: £426,627) are within the above policy. The trustees are looking to build up reserves over the next few years to enable for the trust to purchase its own property.

Page 3

HAPPY CHILDREN LTD

TRUSTEES' REPORT FOR THE YEAR ENDED 31 MAY 2021

Financial review

Going concern

The trust constitutes a public benefit entity as defined by FRS 102. The trustees consider that there are no uncertainties about the trust ability to continue as a going concern over the next twelve months.

Future plans

The trustees constantly review the needs of the children and the nursery. We will continue to work closely with children services and safeguarding the children to ensure they receive appropriate care and education During the forthcoming year we will be considering:

" The Liverpool City Council is launching a continual professional development (CPD) programme to help close the gap of deprivation for disadvantaged programme. Our nursery has applied to be part of the programme"

The trustees acknowledge the rewards for continuing to support staff to gain further qualifications and skills, to enhance the existing workforce and provide high quality staff and work towards all staff having a full level three qualification".

Structure, governance and management Governing document

The charity is controlled by its governing document, a deed of trust, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006.

Organisational structure

The appointed and elected trustees of the charity are legally responsible for the overall management and control of the trust. The members of the board who meet on a minimum of two occasions annually carry out the work of implementing most of their policies. One additional meeting is held specifically to approve the budgets and finalise the financial accounts and trustees report for approval by the annual meeting of the board of trustees. The board works under the chairmanship of the chair of the trust. The board has adopted the code of governance published by the National Governance Hub as a means of building governance capacity and skills.

The day to day running of the trust is delegated to the nursery manager who reports to the board at the bi-annual meetings.

In the interest of liaising with Ofsted the nursery manager is also a director of the nursery.

Page 4

HAPPY CHILDREN LTD

TRUSTEES' REPORT FOR THE YEAR ENDED 31 MAY 2021

Structure, governance and management Risk management

A formal review of the charity's risk management processes is undertaken on an annual basis.

The key controls used by the charity include:

" Formal agendas for the board of trustees, executive committee and all sub-committees;

" Vetting procedures are carried out for adults to safeguard the reputation of the trust and to minimise the risk of inappropriate persons being accepted as employees or volunteers.

Systems of internal control include:

" An annual budget approved by the trustees"

Through the risk management processes established for the trust, the trustees are satisfied that the major risks identified have been adequately mitigated where necessary. It is recognised that systems can only provide reasonable but not absolute assurance that major risks have been adequately safeguarded against material mismanagement or loss.

Trustees' responsibility statement

The trustees (who are also the directors of Happy Children Ltd 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 year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing those financial statements, the trustees are required to

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

A resolution will be proposed for appointing Riley Moss 2018 Ltd, Chartered Accountants as the independent examiners.

Approved by order of the board of trustees on 9[th] May 2022 and signed on its behalf by:

Nagebah Hayel Muckbel Osi-Efa - Trustee

Page 5

INDEPENDENT EXAMINER'S REPORT TO THE TRUSTEES OF HAPPY CHILDREN LTD

Independent examiner's report to the trustees of Happy Children Ltd ('the Company')

I report to the charity trustees on my examination of the accounts of the Company for the year ended 31 May 2021.

Responsibilities and basis of report

As the charity's trustees of the Company (and also its directors for the purposes of company law) you are responsible for the preparation of the accounts in accordance with the requirements of the Companies Act 2006 ('the 2006 Act').

Having satisfied myself that the accounts of the Company are not required to be audited under Part 16 of the 2006 Act and are eligible for independent examination, I report in respect of my examination of your charity's accounts as carried out under section 145 of the Charities Act 2011 ('the 2011 Act'). In carrying out my examination I have followed the Directions given by the Charity Commission under section 145(5) (b) of the 2011 Act.

Independent examiner's statement

I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe:

  1. accounting records were not kept in respect of the Company as required by section 386 of the 2006 Act; or

  2. the accounts do not accord with those records; or

  3. the accounts do not comply with the accounting requirements of section 396 of the 2006 Act other than any requirement that the accounts give a true and fair view which is not a matter considered as part of an independent examination; or

  4. the accounts have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for accounting and reporting by charities (applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)).

I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached.

Farook Patel FCA Riley Moss 2018 Limited Riley House 183-185 North Road Preston Lancashire PR1 1YQ

Date: 9[th] May 2022

Page 6

HAPPY CHILDREN LTD

STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 MAY 2021

2021
Unrestricted
fund
Notes
£
Income and endowments from
Charitable activities
4
Charitable activities
208,201
Investment income
3
1,844
Other income
13,540
Total
223,585
Expenditure on
Charitable activities
5
Charitable activities
149,046
Other
-
Total
149,046
NET INCOME
74,539
Reconciliation of funds
Total funds brought forward
426,627
Total funds carried forward
501,166		 2020
Total
funds
£
248,113
2,020
13,554
263,687
155,776
1,187
156,963
106,724
319,903
426,627

The notes form part of these financial statements

Page 7

HAPPY CHILDREN LTD

BALANCE SHEET 31 MAY 2021

2021
Unrestricted
fund
Notes
£
Fixed assets
Tangible assets
11
3,686
Current assets
Debtors
12
402,483
Cash at bank and in hand
106,678
509,161
Creditors
Amounts falling due within one year
13
(11,681)
Net current assets
497,480
Total assets less current liabilities
501,166
NET ASSETS
501,166
Funds
14
Unrestricted funds
501,166
Total funds
501,166		 2020
Total
funds
£
2,783
840
426,395
427,235
(3,391)
423,844
426,627
426,627
426,627
426,627

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 May 2021.

The members have not required the company to obtain an audit of its financial statements for the year ended 31 May 2021 in accordance with Section 476 of the Companies Act 2006.

The trustees acknowledge their responsibilities for

These financial statements have been prepared in accordance with the provisions applicable to charitable companies subject to the small companies regime.

The financial statements were approved by the Board of Trustees and authorised for issue on 9[th] May 2022 and were signed on its behalf by:

Faiza Akram - Trustee

The notes form part of these financial statements

Page 8

HAPPY CHILDREN LTD NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2021

1. Accounting policies

Basis of preparing the financial statements

The financial statements of the charitable company, which is a public benefit entity under FRS 102, 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)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Income

All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.

Expenditure

Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, 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 accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Fixture and fittings - 25% on reducing balance

Taxation

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

Fund accounting

Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees.

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

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

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to the Statement of Financial Activities on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The charitable company operates a defined contribution pension scheme. Contributions payable to the charitable company's pension scheme are charged to the Statement of Financial Activities in the period to which they relate.

Resources expended

Expenditure is recognised on an accrual basis as a liability is incurred. Expenditure includes any VAT which cannot be fully recovered, and is reported as part of the expenditure to which it relates. Expenditure on raising funds includes the costs of all fundraising activities, events, non-charitable trading activities, and the sale of donated goods.

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

1. Accounting policies - continued

Resources expended

Expenditure on charitable activities includes all costs incurred by a charity in undertaking activities that further its charitable aims for the benefit of its beneficiaries, including those support costs and costs relating to the governance of the charity apportioned to charitable activities.

All costs are allocated to expenditure categories reflecting the use of the resource. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs are apportioned between the activities they contribute to on a reasonable, justifiable and consistent basis.

2. Critical accounting judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

3. Investment income

Deposit account interest
4.
Income from charitable activities
Activity
Fees
Charitable activities		 2021
£
1,844
2021
£
208,201		 2020
£
2,020
2020
£
248,113		 2020
£
2,020

5. Charitable activities costs

Direct Support
Costs (see costs (see
note 6) note 7) Totals
£ £ £
Charitable activities 137,486 11,560 149,046

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

6. Direct costs of charitable activities

2021
£
Staff costs
107,587
Repairs and Maintenance
1,215
Rent
24,000
Postage and stationery
511
Advertising
250
Toys, books and games
2,057
Food
866
Donations
1,000
137,486
Support costs
Governance
Management
costs
£
£
Charitable activities
5,130
6,430
Support costs, included in the above, are as follows:
2021
Charitable
activities
£
Insurance
840
Telephone
307
Sundry expenses
393
Recruitment costs
-
Cleaning
1,218
Training costs
989
Computer costs
Depreciation of tangible and heritage
assets
172
1,211
Accountancy and legal fees
4,414
Legal fees
1,380
Professional Fees
636
11,560
Net income/(expenditure)
Net income/(expenditure) is stated after charging/(crediting):
2021
£
Depreciation - owned assets
1,211
Hire of plant and machinery
1,215
Other operating leases
24,000		 2020
£
120,680
984
24,000
246
-
2,456
1,580
-
149,946
Totals
£
11,560
2020
Total
activities
£
103
612
863
121
572
(3,153)
246
928
3,703
261
-
4,256
2020
£
928
984
24,000

7. Support costs

8. Net income/(expenditure)

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

9. Trustees' remuneration and benefits

There were no trustees' remuneration or other benefits for the year ended 31 May 2021 nor for the year ended 31 May 2020.

Trustees' expenses

There were no trustees' expenses paid for the year ended 31 May 2021 nor for the year ended 31 May 2020.

10. Staff costs

Wages and salaries
Social security costs
Other pension costs		 2021
£
106,282
743
562
107,587		 2020
£
117,553
2,522
605
120,680

The average monthly number of employees during the year was as follows:

2021 2020

12 11

No employees received emoluments in excess of £60,000.

11. Tangible fixed assets

Fixtures
and
fittings
£
Cost
At 1 June 2020 8,430
Additions 2,114
At 31 May 2021 10,544
Depreciation
At 1 June 2020 5,647
Charge for year 1,211
At 31 May 2021 6,858
Net book value
At 31 May 2021 3,686
At 31 May 2020 2,783

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

12. Debtors: amounts falling due within one year
2021 2020
£ £
Other debtors 401,495 -
Prepayments 988 840
402,483 840
13. Creditors: amounts falling due within one year
2021 2020
£ £
Social security and other taxes 9,842 1,764
Other creditors 105 127
Accruals and deferred income 1,734 1,500
11,681 3,391
14. Movement in funds
Net
movement At
At 1.6.20 in funds 31.5.21
£ £ £
Unrestricted funds
General fund 426,627 74,539 501,166
TOTAL FUNDS 426,627 74,539 501,166
Net movement in funds, included in the above are as follows:
Incoming Resources Movement
resources expended in funds
£ £ £
Unrestricted funds
General fund 223,585 (149,046) 74,539
TOTAL FUNDS 223,585 (149,046) 74,539
Comparatives for movement in funds
Net
movement At
At 1.6.19 in funds 31.5.20
£ £ £
Unrestricted funds
General fund 319,903 106,724 426,627
TOTAL FUNDS 319,903 106,724 426,627

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

14. Movement in funds - continued

Comparative net movement in funds, included in the above are as follows:

Unrestricted funds
General fund
TOTAL FUNDS		 Incoming
Resources
Movement
resources
expended
in funds
£
£
£
263,687
(156,963)
106,724
263,687
(156,963)
106,724

A current year 12 months and prior year 12 months combined position is as follows:

Unrestricted funds
General fund
TOTAL FUNDS		 At 1.6.19
£
319,903
319,903		 Net
movement
in funds
£
181,263
181,263		 At
31.5.21
£
501,166
501,166

A current year 12 months and prior year 12 months combined net movement in funds, included in the above are as follows:

Unrestricted funds
General fund
TOTAL FUNDS		 Incoming
Resources
Movement
resources
expended
in funds
£
£
£
487,272
(306,009)
181,263
487,272
(306,009)
181,263

15. Capital commitments

There were no capital commitments authorised or contracted for the year ended 31 May 2021.

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continued...

HAPPY CHILDREN LTD

NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31 MAY 2021

16. Related party disclosures

There were no related party transactions for the year ended 31 May 2021.

17. Company limited by guarantee

Happy Children Ltd is a company limited by guarantee and accordingly does not have a share capital. Every member of the company undertakes to contribute such amount as may be required not exceeding £1 to the assets of the charitable company in the event of its being wound up while he or she is a member, or within one year after he or she ceases to be a member.

18. Control

The charity is under the control of the trustees.

Page 15