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← The Productivity Group

2024-03-31-accounts

THE PRODUCTIVITY GROUP Trading as Be the Business

REPORT AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

Registered charity number: 1173660 Registered company number: 10754958

THE PRODUCTIVITY GROUP (Be the Business) CONTENTS FOR THE YEAR ENDED 31 MARCH 2023

CONTENTS Page
Reference and Administrative Details 1
Trustees’ Report 2 - 3
Chair / CEO Foreword 4 - 10
Statement of Trustees’ Responsibilities 11
Independent Auditors’ Report 12 - 14
Group Statement of Financial Activities 15
Group Balance Sheet 16
Charity Balance Sheet 17
Statement of Cash Flows 18
Notes to the Financial Statements 19 - 27

THE PRODUCTIVITY GROUP (Be the Business) REFERENCE AND ADMINISTRATIVE DETAILS FOR THE YEAR ENDED 31 MARCH 2024

Company registration number

10754958

Charity registration number

1173660

Registered office

10 Queen Street Place London EC4R 1AG

Trustees

Tera Allas Jeremy Anderson Sir Charlie Mayfield (Chair) Hosein Khajeh-Hosseiny

Key management personnel

Anthony Impey – Chief Executive Officer Helen Puddefoot – Chief Operating Officer (resigned 4[th] March 2024)

Bankers

Lloyds Bank 39 Threadneedle Street London EC2R 8AU

Auditors

Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

Introduction

The trustees, who are also the directors of the charity, have the pleasure in presenting their report together with the financial statements of The Productivity Group (Be the Business) for the year to 31 March 2024.

The reference and administrative information set out on page 1 forms part of this report. These financial statements comply with current statutory requirements, the Charity’s memorandum and articles, applicable law and the 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) (Second Edition, effective 1 January 2019), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Our objective

The promotion of industry and commerce in the UK for the public benefit by promoting the productivity of business in order that the UK economy as a whole will benefit through improved business sustainability, employment security, job satisfaction and standards of living.

Our purpose

To build a movement of businesses of all shapes and sizes across the UK who want to improve their own performance and share their advice and experiences to help others do the same.

We’re dedicated to improving productivity across the UK through independent research, data-driven insights, and the development of actionable solutions that work in the real world. We focus on identifying key factors that influence productivity in various sectors. By sharing our findings with policymakers, thought leaders, industry leaders, and small businesses, we seek to create lasting improvements in economic performance and quality of life.

Significant activities

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

Strategy

Our strategy consists of the following elements:

Compliance

The Charity has complied with its duty to have due regard to the Charity Commission's public benefit guidance when exercising any powers or duties to which the guidance is relevant.

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

Why do we care so much about small business productivity?

SMEs employ two thirds of working people in the UK and generate half the income of the private sector.

The leaders of these businesses are among the hardest working and most committed people you’ll ever meet. They’re highly entrepreneurial. They are heavily invested, financially and emotionally, in their businesses. And just because they run small businesses doesn’t diminish what they’re capable of.

They have an essential role in unlocking the growth potential of the UK. They’re distributed across every part of the country, so their success impacts the local communities in which they operate, improving job security and living standards.

It’s because of this that Be the Business exists to increase their productivity.

An introduction from Sir Charlie Mayfield, Chair of the Board of Trustees

We founded Be the Business in 2017, in response to the UK’s productivity challenge – namely that the UK has had minimal productivity growth since 2008, meaning that it lags a long way behind many of its international peers including the US, Germany and France[1] .

It’s often referred to as our productivity puzzle, because it’s become a persistent feature of the economy since the financial crisis in 2008. I’m not sure this is correct anymore. In fact, we know many of the things that need to be done to improve productivity – for small businesses, developing leadership and management capabilities and increasing the adoption of technology, can make a massive difference. Just a 1% productivity increase per annum of all small businesses with employees, would add £94bn to the UK economy over 5 years[2] .

Since we started, Be the Business has worked with leaders of small and midsize businesses to understand their challenges and develop practical ways to make their organisations more productive. Whether it’s been our advisory boards and mentoring services, or our peer-learning programmes, or our online tools, resources and content, we’ve made a big difference to businesses we’ve worked with.

We know this because since we started, we’ve diligently measured the impact of everything we do. The results of an independent evaluation show that across 2,600 firms that we’ve worked with, our impact has increased realised and expected Gross Value Added by £917m, added at least 15,000 more jobs and generated additional sales of over £2bn. We expect this to continue to increase as we iterate our existing initiatives and roll out new programmes and services.

This only accounts for some of our work: for example, our research based on working with leaders of small businesses has also helped influence government policy on small business productivity. By sharing our knowledge and insights, we’ve been able to support the work of other organisations who operate in this space. And we mustn’t forget the tens of thousands of small business leaders who have used our resources and content to take their first steps to making their businesses more productive.

Our strength is in the quality of our insights and findings from understanding what really works with real-life businesses. We do not want to overbuild the existing resources or duplicate effort in the existing business support ecosystem. Instead, we are practitioner-led and apply on-the-ground testing of ideas and thinking, to create great resources that others can use and become part of the productivity movement that we are building.

This means that we will continue to be a small organisation with a significant impact. We know that by being truly independent, combined with our charitable status, means that we are best placed to coordinate and collaborate with every organisation, whether in the private, public, academic, or social sector, who has a stake

1 https://commonslibrary.parliament.uk/researchbriefings/sn02791/#:~:text=International%20comparisons,around%2018%25%20below%20the%20US

2 https://bethebusiness.com/our-thinking/be-the-business-g7-sme-productive-business-index

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

in improving this country’s productivity. Because by enabling others, we can achieve the reach and scale needed to have a significant impact on this country’s productivity.

A note from our Chief Executive, Anthony Impey

The leaders of this country’s small businesses are some of the most inspiring people that you will meet – they have incredible commitment and dedication, and they make extraordinary sacrifices to turn their dreams into reality. Enabling this group of business leaders to fulfil their full potential is vital to growing the economy.

Their stories are hugely motivational to other business leaders who want to hear from people like them, doing things they can do. It’s why we amplify and share these stories with others, including the publication of our first book ‘Inspiring Productivity’ earlier this year.

Businesses continue to face some of the toughest trading conditions in a generation. High interest rates, squeezed supply chains, and rising wages have all contributed to the big challenges business leaders faced this year. It has been small and midsize firms that were especially impacted. It’s only by improving their productivity, that these businesses have been able to get through these tough times by doing more with less. And this has made the work we do more important than ever before.

When we started Be the Business, we were able to move quickly and have an immediate impact thanks to seed funding from government to get our mission moving at pace. That seed money has been hugely important in getting us to where we are today, but it’s always been our ambition to be self-funding - still working in partnership with government but funded by the private sector, enabling us to focus 100% on what our customers need - both the large enterprises who partner with us and the small business leaders who we serve. So, during this year, we started the process to become fully financially independent from government.

To achieve this, we refocused Be the Business on delivering three key areas that we know will increase our influence, reach, and impact:

This new strategic direction has been built from our insight into what our partners and small and midsize business leaders, have taught us over the last seven years. It is based on our resources, intellectual property, and expertise, and powered by an exceptional team.

Financially we are in a strong position to do this. Over the last three years we have pursued a deliberate strategy of reducing our dependence on public funding and increasing the income we generate by providing services to our corporate partners.

We remain totally committed to our charitable status. All the surplus we create is reinvested in developing the impact of our work through our partnerships. We continue to have a strong relationship with government and we will continue to work to support their initiatives that improve small business productivity.

We’re excited to be embarking on the next phase of our mission, and we look forward to delivering this strategy with our strategic partners and small business leaders as we enter this new and exciting era.

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

The transformation of the organisation has been significant and would not have been possible without the tremendous effort of everyone who has helped us on our mission, including both our long-standing and new strategic partners from the private sector, government officials and ministers, those business leaders who have informed what we do, given up their time to support other business leaders and taken part in our programmes, and a whole host of others who have cheered us on and promoted what we do.

But none of this would have been possible without the dedication of the Be the Business team, whose hard work and commitment to the productivity mission has made a huge difference to the businesses we work with. Thank you for everything you do.

Our values

Our organisation is underpinned by three values that guide everything we do:

Challenge the status quo. We inspire courage to drive bold continuous action.

Move with energy and purpose. We connect ambitious people to create a brighter future for all.

Our strategy

There are three pillars to our strategy, based on our understanding of how to address the productivity challenges, the expertise and resources we’ve developed, and the different requirements of the partners that we work with:

Achievements

2023/24 at a glance

3 https://bethebusiness.typeform.com/to/G6TbaR8e?utm_source=xxxxx&typeform-source=bethebusiness.com#source=homepage

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

4 https://bethebusiness.com/our-thinking/be-the-business-g7-sme-productive-business-index

5 https://bethebusiness.com/programmes/the-productivity-programme

6 https://bethebusiness.com/programmes/inspiringleaders

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

Financial review

Income

In the year ending 31 March 2024, the Group recognised £3.9m of Government grant income (2023: £4.8m) and £8m of private income (2023: £6.4m) of which £6.7m was pro-bono in kind support (2023: £4.9m), bringing the total recognised pro-bono value over five years to £29.4 million.

Our net loss for the year of £796k (2023: net income £287k) primarily related to expenditure on our Mastercard Grant of £496k, in accordance with the grant, all income was recognised in the year ending March 2023, and a loss on our government grant of £236k.

Expenditure

Expenditure rose to £12.7m from £10.9m, an increase of 16%, primarily due to the increase in in-kind support donated by our volunteer base. Due to the nature of our work, staff costs represent the other major expense and these costs rose to £3.6m (2023: £3.1m) an increase of 14%.

The reduction in our cash balance of £1.8m, expected but significant, was due to the net loss, amounts owed by our primary funder, subsequently settled, and a purposeful reduction in our creditor liability.

Commercial Trading subsidiary

The commercial subsidiary had income of £0.6 million and all taxable profits are gifted to the charity under deed of donation. We expect activity through the subsidiary to grow in coming years and as at September 2024 we have secured partnerships with BT, Microsoft, Cisco, and the Construction Taskforce, and we continue to build and strengthen our corporate relationships.

Structure, governance and management

Structure

The Productivity Group is an independent registered charity (charity number 1173660), and a company limited by guarantee (company number 10754958). The charity is governed by the Articles of Association dated 30 June 2017.

The trustees of The Productivity Group during the year to 31 March 2024 were Tera Allas, Jeremy Anderson, Hosein Khajeh-Hosseiny, and Sir Charlie Mayfield.

The charity has a wholly owned commercial subsidiary – Be the Business Trading Limited (company number 10894488). The directors of the commercial subsidiary during the year to 31 March 2024 were Paula Carter, Sir Charlie Mayfield, and Phil Smith.

Appointment of trustees and directors is independent of any third parties and is solely decided upon by with the agreement existing trustees and directors. The trustees and directors of each entity meet formally on a quarterly basis to review progress and assess the strategy.

Remuneration

Trustees are responsible for approving the pay and remuneration of key management personnel and agreeing annual staff pay increases, taking external benchmarking advice to inform their decisions.

Our salaries are benchmarked against similar roles in comparable charities, private sector businesses and other relevant organisations and they reflect the knowledge, skills, responsibilities and attributes required for the performance of each position.

Induction and training of Trustees

To equip new trustees with the information they need to perform their role effectively, they receive detailed information on their duties and responsibilities under Charity Law and follow a structured induction programme consisting of meetings with the senior management team and other key stakeholders. Trustees also undergo regular training as required.

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

How the charity makes decisions

Key strategic decisions are made by the trustees and are then delegated to the Senior Leadership Team for implementation.

Fundraising approach

During the year to 31 March 2024, Be the Business operated a split funding model, made up of government and non-government grants, and contributions from commercial organisations (both financial and pro-bono).

The focus has been on building a pipeline of opportunities that generate private sector income and income from grant giving bodies, to enable us to be financially independent of government from 1 April 2024 onwards.

Be the Business does not fundraise directly from members of the public.

Reserves Policy

The Trustees have established a reserves policy in order to protect the organisation and its programmes from the risk of disruption at short notice due to a lack of funds, whilst ensuring that it does not retain income for longer than required.

In establishing the reserves policy, the Trustees have considered the following factors:

The requirements of our grant agreements with the Department of Business and Trade, Mastercard Impact Fund and Nominet UK mean that these funds may be used to generate unrestricted reserves.

Trustees have determined that a target of £550k in unrestricted reserves is desirable for 2023/24 to mitigate any potential risks. Unrestricted reserves at 31 March 2024 were above target at £1,875k, (2023: £1,917k) which trustees have confirmed is appropriate given budget and investment needs for the years ahead.

As at 31 March 2024 the charity also holds £1,263k in restricted funds (2023: £2,017k), which are to be used for specific purposes as defined by funders

Risk Management

Be the Business considers good risk management to be a key part of its operational requirements. As such, consideration is given to areas of activity where stakeholders or the reputation of the organisation are potentially vulnerable to adverse actions that could affect:

In formulating the view of risk, the trustees have specifically considered the following:

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

To manage these risks, a register is maintained and reported to the Trustees on an ongoing basis. Periodic monitoring also ensures that systems and procedures are being followed and that new risks are addressed and identified as they arise. External audits and internal reviews take place to assess the effectiveness of risk controls.

Future plans and going concern

During this year, we laid the foundations of our new strategy to become financially sustainable and fully independent of government funding. This is enabling us to focus 100% of what our customers need and will be the basis of our work going forward. This will include:

This activity will enable us to solidify our strategy and, crucially, to continue to have significant and meaningful impact on the country’s productivity. We intend to develop our partnerships with others, including local government, to reach more businesses with our resources and expertise which we know make a real difference to the businesses that have access to them.

Going concern

Given the above, the Trustees are assured that the charity’s strategy and ambition are aligned to its founding principles. And having reviewed our financial position, reserves levels, and opportunity pipeline, they are confident that the organisation remains a going concern for the foreseeable future with reserves forecast for at least twelve months from the date of signing the accounts.

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THE PRODUCTIVITY GROUP (Be the Business) TRUSTEES’ REPORT FOR THE YEAR ENDED 31 MARCH 2024

Statement of Trustees’ Responsibilities

The trustees (who are also directors of The Productivity Group for the purposes of Company law) are responsible for preparing the Trustees’ Report and financial statements in accordance with applicable law and 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, including the incoming resources and the application of resources, including income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

The trustees are responsible for keeping adequate accounting records that are disclose with reasonable accuracy at any time the financial position of the charitable company and which 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.

The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company’s website. Legislations in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

In so far as each of the trustees are aware at the time the report is approved:

Approved by the Board on 25 September 2024 and signed on its behalf by:

Sir Charlie Mayfield Chair of Trustees

11

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS AND TRUSTEES OF THE PRODUCTIVITY GROUP

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS AND TRUSTEES OF THE PRODUCTIVITY GROUP

Opinion

We have audited the financial statements of The Productivity Group for the year ended 31 March 2024 which comprise the Consolidated Statement of Financial Activities, the group and parent charitable company’s Balance Sheets, the Consolidated Cash Flow Statement and notes to the financial statements, 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:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group’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.

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Trustees’ 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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

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INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS AND TRUSTEES OF THE PRODUCTIVITY GROUP

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Annual Report (which incorporates the strategic report and the directors’ report).

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement set out on page 2, 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 group’s and the parent 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 group or the parent charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in 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.

Based on our understanding of the group and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to the reporting requirements of the Department for Business & Trade (DBT) and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Charities Act 2011, Charities SORP (2019), Companies Act 2006 and payroll taxes.

We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks are related to the valuation of pro bono services and the recognition of grant income. Audit procedures performed by the engagement team included:

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INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS AND TRUSTEES OF THE PRODUCTIVITY GROUP

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation

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 auditor’s report.

Use of our report

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

Thomas Wilson (Senior Statutory Auditor) For and on behalf of Haysmacintyre LLP, Statutory Auditors Date: 29/10/2024

10 Queen Street Place London EC4R 1AG

14

THE PRODUCTIVITY GROUP (Be the Business) GROUP STATEMENT OF FINANCIAL ACTIVITIES (incorporating an income and expenditure account) FOR THE YEAR ENDED 31 MARCH 2024

Notes
Unrestricted
Funds
£
Income and endowments from:
Donations and pro-bono support
2
-
Charitable activities:
DBT Grant
-
Other
33,925
Other Trading Income
3
647,980
Total Income
681,905
Expenditure on:
Charitable activities
723,653
Total Expenditure
4
723,653
Net (Expenditure)/ Income
7
(41,748)
Net Movement in funds
(41,748)
Reconciliation of funds
Total funds brought forward
1,917,012
Total funds carried forward
14
1,875,264		 Restricted
Funds
£
6,690,668
3,872,826
677,488
-
11,240,982
11,994,993
11,994,993
(754,011)
(754,011)
2,017,019
1,263,008		 Total 2024
£
6,690,668
3,872,826
711,413
647,980
11,922,887
12,718,646
12,718,646
(795,759)
(795,759)
3,934,031
3,138,272		 Total 2023
£
4,909,534
4,841,251
883,786
575,342
11,209,913
10,922,703
10,922,703
287,210
287,210
3,646,821
3,934,031

All the above results are derived from continuing activities. There are no recognised gains or losses other than those stated above.

Full comparative figures for the year ended 31 March 2023 are shown in note 19.

The notes on pages 19 to 27 form part of these financial statements.

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THE PRODUCTIVITY GROUP (Be the Business) GROUP BALANCE SHEET AS AT 31 MARCH 2024

Company number 10754958

Notes
Fixed Assets
11
Total Fixed Assets
Current Assets
Debtors – amounts falling due within one year
12
Cash at Bank
Total Current Assets
Liabilities
Creditors: amounts falling due within one year
13
Net Current Assets
Total Assets less current liabilities
Total Net Assets
The funds of the charity:
Unrestricted funds
Restricted funds
Total Group Funds
15		 2024
2023
£
£
29,778
45,483
29,778
45,483
2,092,408
1,406,134
1,756,582
3,610,132
3,848,990
5,016,266
(740,496)
(1,127,718)
3,108,494
3,888,548
3,138,272
3,934,031
3,138,272
3,934,031
1,875,264
1,917,012
1,263,008
2,017,019
3,138,272
3,934,031

The company has taken the exemption allowed by section 408 of the Companies Act 2006, not to prepare a company only statement of financial activities. The net loss for the charity for the year was £(795,759) (2023: net income of £287,210).

The notes on pages 19 to 27 form part of these financial statements.

The accounts were approved by the Trustees on 25 September 2024 and signed on their behalf by:

……………………………….

Sir Charlie Mayfield Chair

16

THE PRODUCTIVITY GROUP (Be the Business) CHARITY BALANCE SHEET AS AT 31 MARCH 2024

Company number 10754958

Notes
Fixed Assets
11
Total Fixed Assets
Current Assets
Debtors – amounts falling due within one year
12
Cash at Bank
Total Current Assets
Liabilities
Creditors: amounts falling due within one year
13
Net Current Assets
Total Assets less current liabilities
Total Net Assets
The funds of the charity:
Unrestricted funds
Restricted funds
Total Group Funds
15		 2024
£
29,778
29,778
2,768,780
1,026,915
3,795,695
(687,201)
3,108,494
3,138,272
3,138,272
1,875,264
1,263,008
3,138,272		 2023
£
45,483
45,483
1,760,113
2,972,444
4,732,557
(844,009)
3,888,548
3,934,031
3,934,031
1,917,012
2,017,019
3,934,031

The notes on pages 19 to 27 form part of these financial statements.

The accounts were approved by the Trustees on 25 September 2024 and signed on their behalf by:

……………………………….

Sir Charlie Mayfield Chair

17

THE PRODUCTIVITY GROUP (Be the Business) GROUP STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 31 MARCH 2024

Notes
2024
2023
£
£
Cash flows (used in) / from operating activities
A
(1,848,148)
88,117
Cash flows (used in) investing activities
Net purchase of tangible fixed assets
(5,402)
(38,288)
Change in cash and cash equivalents in the period
B
(1,853,550)
49,829
Cash and cash equivalents at the beginning of the period
3,610,132
3,560,303
Cash and cash equivalents at the end of the period
1,756,582
3,610,132
A. Reconciliation of net income to net cash flow
from operating activities
2024
2023
£
£
Net Income
(795,759)
287,210
(Increase) in debtors
(686,273)
(235,637)
(Decrease)/Increase in creditors
(387,222)
22,022
Depreciation of fixed assets
21,106
14,522
Net Cash provided by operating activities
(1,848,148)
88,117
B. Analysis of changes in net cash funds
At 1 April
2023
Cashflows
At 31 March
2024
£
£
£
Cash in hand
3,610,132
(1,853,550)
1,756,582
Total cash and cash equivalents
3,610,132
(1,853,550)
1,756,582		 Notes
2024
2023
£
£
Cash flows (used in) / from operating activities
A
(1,848,148)
88,117
Cash flows (used in) investing activities
Net purchase of tangible fixed assets
(5,402)
(38,288)
Change in cash and cash equivalents in the period
B
(1,853,550)
49,829
Cash and cash equivalents at the beginning of the period
3,610,132
3,560,303
Cash and cash equivalents at the end of the period
1,756,582
3,610,132
A. Reconciliation of net income to net cash flow
from operating activities
2024
2023
£
£
Net Income
(795,759)
287,210
(Increase) in debtors
(686,273)
(235,637)
(Decrease)/Increase in creditors
(387,222)
22,022
Depreciation of fixed assets
21,106
14,522
Net Cash provided by operating activities
(1,848,148)
88,117
B. Analysis of changes in net cash funds
At 1 April
2023
Cashflows
At 31 March
2024
£
£
£
Cash in hand
3,610,132
(1,853,550)
1,756,582
Total cash and cash equivalents
3,610,132
(1,853,550)
1,756,582		 Notes
2024
2023
£
£
Cash flows (used in) / from operating activities
A
(1,848,148)
88,117
Cash flows (used in) investing activities
Net purchase of tangible fixed assets
(5,402)
(38,288)
Change in cash and cash equivalents in the period
B
(1,853,550)
49,829
Cash and cash equivalents at the beginning of the period
3,610,132
3,560,303
Cash and cash equivalents at the end of the period
1,756,582
3,610,132
A. Reconciliation of net income to net cash flow
from operating activities
2024
2023
£
£
Net Income
(795,759)
287,210
(Increase) in debtors
(686,273)
(235,637)
(Decrease)/Increase in creditors
(387,222)
22,022
Depreciation of fixed assets
21,106
14,522
Net Cash provided by operating activities
(1,848,148)
88,117
B. Analysis of changes in net cash funds
At 1 April
2023
Cashflows
At 31 March
2024
£
£
£
Cash in hand
3,610,132
(1,853,550)
1,756,582
Total cash and cash equivalents
3,610,132
(1,853,550)
1,756,582
Cashflows
At 31 March
2024
£ £
£
3,610,132
(1,853,550)
1,756,582
3,610,132
(1,853,550)
1,756,582

No separate reconciliation of net debt has been prepared as there is no difference between the net cash (debt) of the Charity and cash and cash equivalents

18

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

1. ACCOUNTING POLICIES

The principal accounting policies adopted, judgements and key sources of estimation and uncertainty in the preparation of the financial statements are as follows:

Basis of accounting

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice for Charities (FRS102) applicable to charities preparing accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102), the Companies Act 2006 and the Charities Act 2011.

The charity meets the definition of a public benefit entity under FRS 102, with its objective to promote the productivity of business in order that the UK economy as a whole will benefit through improved business sustainability, employment security, job satisfaction and standards of living (see pages 2 and 3 for further details).

The charity has one subsidiary company, Be the Business Trading Ltd, registered in England and Wales under company number 10894488. The group accounts include the results of the subsidiary, consolidated on a line-byline basis.

General Information

The Productivity Group, trading as Be the Business, was incorporated in England and Wales on 4 May 2017 as a charitable company limited by guarantee (company number 10754958 and a charity registered in England and Wales (charity number 1173660). The registered office address is 10 Queen Street Place, London, England, EC4R 1AG and the charity operates from its principal address at 26-28 Glasshouse Yard, London EC1A 4JU.

Preparation of accounts on a going concern basis

The Trustees consider there are no material uncertainties about the charity’s ability to continue as a going concern. Operations have continued successfully to the date of signing these accounts, and the review of our financial position, funding discussions, reserves levels and future plans, Trustees have confidence that the charity remains a going concern for the foreseeable future.

Significant judgements and sources of estimation uncertainty

In preparing the financial statements management has made judgements, estimates and assumptions that affect the application of the charity’s accounting policies. The trustees consider that the key area of judgement in the accounts is the valuation of pro-bono support.

Pro-bono support is valued at the lower of the value of the donation to the charity and fair value and is recognised on receipt of the support. We are fortunate to receive a wide range of pro-bono support from a large number of sources which is valued on a prudent basis using appropriate estimation techniques. The rate card developed by management for recurring pro bono support is reviewed every six months to test that the valuation assumptions remain appropriate. Material categories of support and the basis for valuation are as follows:

19

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

1. ACCOUNTING POLICIES (continued)

Funds structure

Unrestricted income funds comprise those funds which the Trustees are free to use for any purpose in furtherance of the charitable objects. Designated funds are unrestricted funds earmarked by the Trustees for particular activities or purposes. Restricted funds are those funds which are to be used in accordance with specific instructions imposed by the donor or funder.

Income

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

Expenditure

Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that the settlement will be required, and the amount of the obligation can be measured reliably. Expenditure includes attributable VAT which cannot be recovered.

Tangible Fixed Asset and Depreciation

All assets costing more than £500 are capitalised. Tangible fixed assets are carried at cost, net of depreciation and any provision for impairment. Depreciation is provided at rates calculated to write off the cost of the fixed assets, less their estimated residual value, over their useful lives.

Computer Equipment 33.3% straight line.

Debtors

Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

Creditors

Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are recognised at their settlement amount after allowing for any trade discounts due.

Pensions

The charity operates a defined contribution pension scheme for the benefit of its employees. The assets of the scheme are held independently from those of charity in an independently administered fund. The pensions costs charged in the financial statements represent the contributions payable during the period.

Employee short term benefits

Short term benefits including holiday pay are recognised as an expense in the period in which the service is received.

Foreign exchange

Monetary assets and liabilities denominated in foreign currencies are translated at the period end rate of exchange. Transactions denominated in foreign currencies are translated at the rates prevailing at the transaction date.

Financial instruments

The charity 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.

20

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

2. DONATIONS & PRO-BONO SUPPORT
2024
 2023
£ £
Donations - 50,675
---------------------
---------------------
Programmatic Support 6,239,774
4,435,215
Movement building and campaigns 4,920 23,897
Consultancy - 4,827
Secondments 30,234 -
Office space 390,000 390,000
Other pro-bono 25,740 4,920
---------------------
---------------------
Total pro-bono 6,690,668
4,858,859
---------------------
---------------------
Total donations & pro-bono support 6,690,668
4,909,534
---------------------
---------------------
3. OTHER TRADING INCOME 2024
 2023
£ £
Primary purpose trading - 111,875
Commercial trading 647,980 463,467
---------------------
---------------------
Total other income 647,980 575,342
---------------------
---------------------
4. ANALYSIS OF EXPENDITURE 2024 Staff Direct Support
costs costs costs Total 2024 Total 2023
£ £ £ £ £
Movement building and Campaigns 1,286,221 886,469 293,067 2,465,757 2,645,634
Programmes and Pilots 952,259 6,870,941 527,521 8,350,721 6,202,265
Evaluation Research and Insights 502,614 199,505 63,942 766,061 822,739
Digital tools 675,721 305,860 154,526 1,136,107 1,252,065
--------------------- --------------------- --------------------- --------------------- ---------------------
Total expenditure 3,416,815 8,262,775 1,039,056 12,718,646 10,922,703
--------------------- --------------------- --------------------- --------------------- ---------------------
ANALYSIS OF EXPENDITURE 2023 Staff
Direct		 Support
costs
costs		 costs Total 2023 Total 2022
£
£		 £ £ £
Movement building and Campaigns 1,023,521
1,345,618		 276,495 2,645,634 2,785,985
Programmes and Pilots 866,341
5,051,889		 284,035 6,202,268 6,045,884
Evaluation Research and Insights 420,616
341,797		 60,326 822,739 1,026,828
Digital tools 688,428
387,686		 175,951 1,252,065 1,589,818
---------------------
---------------------		 --------------------- --------------------- ---------------------
Total expenditure 2,998,906
7,126,990		 796,807 10,922,703 11,628,515
---------------------
---------------------		 --------------------- --------------------- ---------------------

21

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

5. SUPPORT COSTS 2024 2023
£ £
Staff related costs 397,935 191,617
Office costs 403,425 399,123
IT support 84,954 114,368
Professional fees 101,161 107,073
Depreciation 21,106 12,596
Realised currency gains (27,785) (94,709)
Irrecoverable VAT 58,260 64,814
---------------------- ---------------------
1,039,056 796,807
---------------------- --------------------
6. GOVERNANCE COSTS (included above) 2024 2023
£ £
Audit fees 22,650 21,000
Other services 12,410 9,744
----------------- -----------------
35,060 30,744
----------------- -----------------
7. NET INCOME / EXPENDITURE 2024 2023
£
 £
Net income is stated after charging:
Auditors’ remuneration
Audit services 22,650 21,000
Other services 12,410 9,744
Depreciation 21,106 14,522
8. STAFF COSTS AND NUMBERS 2024 2023
£ £
Salaries and wages 2,809,251 2,479,039
Social security costs 309,913 283,468
Pension costs 255,609 229,205
Secondment and consultancy fees 130,529 176,810
Other staff costs 69,786 31,700
--------------------- ---------------------
3,575,088 3,143,644
--------------------- ---------------------

Included in other staff costs are payments made on termination of £42,042 (2023: £15,347).

2024
 2023
Average staff numbers (including secondees):
Movement building and Campaigns 9.2 9.2
Programmes and Pilots 16.5 9.4
Evaluation Research and Insights 2.0 2.0
Digital tools 4.8 5.8
Partnerships 6.0 4.6
Administration staff (including core senior leadership team) 12.4 8.2
----------------- -----------------
50.9
 39.3
---------------- ----------------

22

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

Number of employees whose emoluments in the period were:

2024 2023
£60,000 - £69,999 4 1
£70,000 - £79,999 3 4
£80,000 - £89,999 2 7
£90,000 - £99,999 2 1
£110,000 - £119,999 2 -
£270,000 - £279,999 1 1

Total remuneration of the key management personnel of the charity was £460,181 (2023: £1,099,184).

9. TRUSTEES

No trustees received remuneration from the charity for their services (2023: none). No expenses were reimbursed to trustees in the period. (2023: none)

10. TAXATION

The charity is exempt from corporation tax as all its income is applied for charitable purposes. The charity’s trading subsidiary donates to the charity an amount equal to any taxable profits under Gift Aid. Consequently there is no taxation charge for the year (2023: £nil).

11. TANGIBLE FIXED ASSETS – CHARITY AND GROUP

2024 2023
£ £
Cost at 1 April 91,117 52,829
Additions 5,402 38,288
Disposals - -
--------------------- ---------------------
As at 31 March 96,519 91,117
Depreciation at 1 April 45,635 31,112
Charged in year 21,106 14,522
--------------------- ---------------------
As at 31 March 66,741 45,634
--------------------- ---------------------
Net book value at 31 March 29,778 45,483
--------------------- ---------------------

12. DEBTORS

EBTORS
Group Charity
2024 2023 2024 2023
£ £ £ £
Prepayments 55,020 162,188 55,020 161,794
Debtors 403,870 107,373 360,370 10,563
Sundry Debtors 6,547 - 6,547
Amounts owed by group undertakings - - 719,872 451,183
Accrued income 1,626,971 1,136,573 1,626,971 1,136,573
--------------------- --------------------- --------------------- ---------------------
2,092,408 1,406,134 2,768,780 1,760,113
--------------------- --------------------- --------------------- ---------------------

Accrued income of £nil (2023 - £nil) in both group and charity is due after more than one year.

23

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

13. CREDITORS – AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Group Charity Charity
2024 2023 2024 2023
£ £ £ £
Trade Creditors 494,836 491,860 494,036 487,360
Sundry Creditors 2,840 27,276 2,840 13,592
Deferred income 46,420 255,000 - -
Accruals 196,400 353,582 190,325 343,057
--------------------- --------------------- --------------------- ---------------------
740,496 1,127,718 687,201 844,009
--------------------- --------------------- --------------------- ---------------------

14a. ANALYSIS OF NET ASSETS BETWEEN FUNDS – GROUP AND CHARITY 2024

Unrestricted Restricted Total 2024
funds funds
£ £ £
Fixed Assets 28,778 1,000 29,778
Current Assets 2,069,020 1,779,970 3,848,990
Creditors: amounts falling due within one year (222,534) (517,962) (740,496)
--------------------- --------------------- ---------------------
Net assets 1,875,264 1,263,008 3,138,272
--------------------- --------------------- ---------------------

14b. ANALYSIS OF NET ASSETS BETWEEN FUNDS – GROUP AND CHARITY 2023

Unrestricted Restricted Total 2023
funds funds
£ £ £
Fixed Assets 43,721 1,762 45,483
Current Assets 2,236,700 2,779,566 5,016,266
Creditors: amounts falling due within one year (363,409) (764,309) (1,127,718)
--------------------- --------------------- ---------------------
Net assets 1,917,012 2,017,019 3,934,031
--------------------- --------------------- ---------------------

24

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

15. NET MOVEMENT IN FUNDS – GROUP 2024

At 1 April Income Expenditure At 31
2023 March
2024
£ £ £ £
Restricted funds
Department for Business & Trade 277,488 3,872,826 (4,108,980) 41,334
Productivity through People 50,000 - - 50,000
Mastercard Impact Fund 941,647 - (495,928) 445,719
Ufi VocTech Trust 40,056 (1,804) (32,556) 5,696
The University of Manchester - 24,970 (15,998) 8,972
The University of Bath (Nominet UK) 704,705 654,322 (647,740) 711,287
Scottish Enterprise 3,123 - (3,123) -
Other (Pro Bono) - 6,690,668 (6,690,668) -
Total restricted funds 2,017,019 11,240,982 (11,994,993) 1,263,008
Unrestricted funds
Charity 1,917,012 380,544 (422,292) 1,875,264
Subsidiary - 301,361 (301,361) -
Total unrestricted funds 1,917,012 681,905 (723,653) 1,875,264
--------------------- --------------------- --------------------- ---------------------
Total funds 3,934,031 11,922,887 (12,718,646) 3,138,272
--------------------- --------------------- --------------------- ---------------------

The nature and purpose of each material restricted fund is as follows:

Productivity through People

Mastercard Impact Fund

Grant agreement as part of the Stive UK initiative to work with Black, Asian and other ethnic minority business leaders from around the country to support the development of their businesses.

University of Bath (Nominet UK)

25

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

15b. NET MOVEMENT IN FUNDS – GROUP 2023

At 1 April Income Expenditure At 31
2022 March
2023
£ £ £ £
Restricted funds
Department for Business & Trade 122,204 4,841,251 (4,685,967) 277,488
Productivity through People 50,000 - - 50,000
Good Things Foundation 68,959 - (68,959) -
Mastercard Impact Fund 1,359,680 - (418,033) 941,647
Ufi VocTech Trust - 50,000 (9,944) 40,056
The University of Bath-Nominet UK - 785,794 (81,089) 704,705
Scottish Enterprise - 32,637 (29,514) 3,123
Other (Pro Bono) - 4,858,859 (4,858,859) -
Total Restricted funds 1,600,843 10,568,541 (10,152,365) 2,017,019
Unrestricted funds
Charity 2,045,978 176,251 (305,217) 1,917,012
Subsidiary - 465,121 (465,121) -
Total Unrestricted funds 2,045,978 641,372 770,338 1,917,012
--------------------- --------------------- --------------------- ---------------------
Total funds 3,646,821 11,209,913 (10,922,703) 3,934,031
--------------------- --------------------- --------------------- ---------------------

16a. NET MOVEMENT IN FUNDS – CHARITY 2024

At 1 April Income Expenditure Gift Aid At 31 March
2023 Transfer 2024
£ £ £ £
Restricted funds 2,017,019 11,240,982 (11,994,993) - 1,263,008
Unrestricted funds 1,917,012 329,581 (723,653) 352,324 1,875,264
--------------------- --------------------- --------------------- --------------------- ---------------------
Total funds 3,934,031 11,570,563 (12,718,646) 352,324 3,138,272
--------------------- --------------------- --------------------- --------------------- ---------------------

17. TRADING SUBSIDIARY

The charity owns 100% of the share capital of Be the Business Trading Limited, company number 10894488, (registered in England and Wales). The results for the year to 31 March 2024 are shown below.

2024 2023
£ £
Turnover 653,685 465,121
Administrative costs (including intercompany recharge) (301,361) (284,343)
--------------------- ---------------------
Net profit before taxation 352,324 180,778
--------------------- ---------------------
Net current assets 1 1
--------------------- ---------------------

26

THE PRODUCTIVITY GROUP (Be the Business) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024

100% of the trading subsidiary’s taxable profits of £352,324, (2023: £180,778) are donated to the parent under the existing deed of covenant.

18. RELATED PARTY TRANSACTIONS

There were no related party transactions in 2024 (2023: £nil).

19. GROUP STATEMENT OF FINANCIAL ACTIVITIES 2023

Notes
Unrestricted
Funds
£
Income and endowments from:
Donations and legacies
2
50,675
Charitable activities:
DBT Grant
-
Other
15,355
Other Trading Income
3
575,342
Total Income
641,372
Expenditure on:
Charitable activities
770,338
Total Expenditure
4
770,338
Net Income/(Expenditure)
7
(128,966)
Net Movement in funds
(128,966)
Reconciliation of funds
Total funds brought forward
2,045,978
Total funds carried forward
13
1,917,012		 Restricted
Funds
£
4,858,859
4,841,251
868,431
-
10,568,541
10,152,365
10,152,365
416,176
416,176
1,600,843
2,017,019		 Total 2023
£
4,909,534
4,841,251
883,786
575,342
11,209,913
10,922,703
10,922,703
287,210
287,210
3,646,821
3,934,031

All the above results are derived from continuing activities. There are no recognised gains or losses other than those stated above.

27