2021-12-31-accounts - Arts Factory Ltd

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Report and Financial Statements for the year ended 31 December 2021

for

Arts Factory Ltd (A company limited by guarantee)

Company registration number 02491685 Charity number 1178430

Arts Factory Ltd

Contents of the Financial Statements for the year ended 31 December 2021

	Page
Charity and Company Information	1
Report of the Trustees	2 - 4
Independent Examiners' Report	5
Statement of Financial Activities	6
Balance Sheet	7
Notes to the financial statements	8 - 12

Arts Factory Ltd

Charity Information for the year ended 31 December 2021

Directors and Trustees Mr M Bryan (Chair) Ms A Evans Mr B Triggs Mr L Moss Mr R Lines Ms A Love resigned 10 January 2022 Charity Number 1178430 Company Number 2491685 Registered Office Trerhondda The Strand Ferndale Rhondda Cynon Taff CF43 4LY Accountants and Independent Arian Accountants Limited Examiners 19 Sundew Close Cardiff CF5 2SE Bankers Barclays Bank plc

Page 1

Arts Factory Ltd

Report of the Trustees for the year ended 31 December 2021

The trustees are pleased to present their annual directors' report together with the financial statements of the charity for the year ending 31 December 2021 which are also prepared to meet the requirements for a directors' report and accounts for Companies Act purposes. The financial statements comply with the Charities Act 2011, the Companies Act 2006, the Memorandum and Articles of Association, and 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 2015).

Objectives and activities

Objectives

The objects of the charity are to provide or assist in the provision of social welfare facilities for recreation or other leisure time occupation by individuals who have need of such facilities by reason of their youth, age, infirmity or disability, financial hardship or social circumstances with the object of improving their conditions of life.

Activities

The charity operates a Health and Wellbeing Centre at Trerhondda Chapel in the town centre of Ferndale in the upper Rhondda Fach. The centre runs various courses, clubs and groups for beneficiaries as well as a number of social business activities that both generate income and allow us to offer opportunities to people to train and upskill themselves through volunteering. The charity relies on earned income, grants, a service level agreement and donations to cover its operating costs.

The Trustees endeavour to encourage all members of the community to engage in our activities and programmes and this should enable them to change their lives.

Achievements

Achievements and highlights of the year for Arts Factory include:

We are proud to say that, despite 2021 being another year that was heavily impacted by the Covid pandemic, and where our ability to serve the community was curtailed at times due to the restrictions in place, we were one of the few community facilities that were open as often as the rules allowed, with the appropriate Covid risk assessments in place.
2021 also saw the growth of our staff team, with three 3 new members of staff taken on in the roles of Garden Coordinator, Garden Assistant and Warehouse Van Driver.
Our Fareshare Cupboard Essential Parcels were constantly busy during 2021. During the year we delivered 1125 food parcels which helped to feed 1728 adults and 751 children.
We had a visit from Mark Drakeford, First Minister of Wales, in April 2021 to look at what we have been doing at Arts Factory during the pandemic.
Some of our staff and key volunteers were filmed by the BBC for a Hayley Pearce show called Virgin Voter, to show the work we were doing around food poverty and why people should be voting.
We celebrated Volunteers Week in June and our Health & Wellbeing Coordinator was interviewed live on Rhondda Radio promoting our services.
We worked in partnership with Aim Academy, Cambrian Village Trust and YEPS to deliver our Summer of Fun School Holiday programme.
Our Graphic Design service has continued to grow from strength to strength during 2021 and sales exceeded budget figures.
Factory Books has had a slow year and volunteers were still getting used to being able to mingle and be back at the workplace. Lots of our volunteers needed additional support around their mental health and the after effects of numerous lockdowns.
Friendly Friday’s community Café was launched for people to pop in for a cuppa and a chat, a low cost and fun atmosphere.
We were successful in gaining funding from the Welsh Government Kickstart initiative which enabled us to employ a Finance Assistant.

Page 2

Arts Factory Ltd

Report of the Trustees (continued)

We launched Rhondda Fach Community Garden on 1[st] July 2021, and it was opened by the local Mayor for Rhondda Cynon Taff. Intergenerational work has commenced with the local primary schools. This project has gone from strength to strength and has involved lots of community activities such as litter picking, garden clearances, open days and partnership working with other groups.
Active Inclusion new funding commenced on 1[st] November 2021 and will see the project continue until September 2022. There was a waiting list of participants for this new project.
Barod are now offering a weekly drop-in service at Trerhondda.
We were awarded the “Mayor of Rhondda Cynon Taff Community Award 2021” for our work in the community.
We celebrated Welsh Charities Week with the limelight being shone on our volunteer team.
We delivered Christmas Hampers to local primary schools for the families that were in need.
We were fortunate to have funding to run a coach trip for staff, volunteers, and group members to the New Theatre in Cardiff to see the panto Aladdin.

Financial review

Members of the management committee meet quarterly to review the financial position of the charity. As a result of this information they are confident in realistically reviewing and adjusting budgets. During the year funding continued to be received for the charity's main activities. We were fortunate to obtain funding from a large number of funders such as Pen y Cymoedd Windfarm with £14,647, Natural Resources Wales with £21,750 and various Interlink grants totalling £19,758. The Wales Council for Voluntary Action continued their support with a grant of £24,304.

It is the policy of the charity that the unrestricted reserves (excluding any designated funds) should be at least £75,000. At this level the trustees consider that they would be able to accommodate any fundamental funding changes. As at the balance sheet date the charity has met this objective as total unrestricted general reserves were £102,104.

Structure, governance and management

The charity is constituted as a company limited by guarantee and is also a registered charity. The directors serve also as the trustees of the charity. Reference and administrative details are shown in the company information page. The directors have the power to appoint additional trustees.

Trustees' responsibilities in relation to the financial statements

The charity trustees (who are also the directors of the Arts Factory Ltd for the purposes of company law) are responsible for preparing a trustees' annual report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the charity trustees to prepare financial statements for each 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 the financial statements, the trustees are required to:

select suitable accounting policies and then apply them consistently;
observe the methods and principles in the Charities SORP;
make judgements and estimates that are reasonable and prudent;

Page 3

Arts Factory Ltd

Report of the Trustees (continued)

• state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in business.

The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charity 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 charity and the group and hence 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. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

In so far as the trustees are aware:

• there is no relevant information of which the charity's Independent Examiner is unaware; and

• the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant information and to establish that the Independent Examiner is aware of that information.

Approval by order of the board of trustees

MH Bryan

Director

Page 4

Independent Examiner's Report to the Trustees of Arts Factory Ltd ("the Company")

I report to the charity trustees on my examination of the accounts of Arts Factory Ltd for the year ended 31 December 2021.

Responsibilities and basis of report

As the charity's trustees of the Company (and also it's 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

Since the Company's gross income exceeded £250,000 your examiner must be a member of a body listed in section 145 of the 2011 Act. I confirm that I am qualified to undertake the examination because I am a member of The Institute of Chartered Accountants in England and Wales, which is one of the listed bodies.

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.

Andrea L Davies ACA

9 May 2022

Chartered Accountant

Arian Accountants Limited

19 Sundew Close Cardiff CF5 2SE

Page 5

Arts Factory Ltd

Statement of Financial Activities (incorporating the income and expenditure account) for the year ended 31 December 2021

Note Income Donations and legacies 3 Income from charitable activities: Arts Factory operations 4 Investment income Total income Expenditure Expenditure on charitable activities: Arts Factory operations 5 Total expenditure Net income and net movement in funds for the year Reconciliation of funds Total funds brought forward Transfer between funds Total funds carried forward	Restricted Funds £ - 227,075 -	Unrestricted Funds £ 13,592 245,444 10 259,046 181,534 181,534 77,512 281,488 (4,880) 354,120	2021 Total £ 13,592 472,519 10 486,121 409,870 409,870 76,251 313,127 - 389,378	2020 Total £ 1,670 456,133 33
	227,075			457,836
	228,336			340,847
	228,336			340,847
	(1,261) 31,639 4,880			116,989 196,138 -
	35,258			313,127

The Statement of Financial Activities includes all gains and losses in the year and therefore a statement of total recognised gains and losses has not been prepared.

All income and expenditure derive from continuing activities.

The notes on pages 8 to 12 form part of these financial statements

Page 6

Arts Factory Ltd

Balance Sheet As at 31 December 2021

Note Fixed assets Tangible assets 8 Current assets Debtors 9 Cash at Bank and in hand Current Liabilities Creditors: Amounts falling due within one year 10 Net current (liabilities)/assets Total assets less current liabilities Creditors: Amounts falling due after more than one year 11 Net assets The funds of the charity: Unrestricted income funds Designated fund 12 General income fund Restricted income funds 13 Capital grants funds 14 Total charity funds	£ £ 253,766 53,292 163,893 217,185 (33,491) 183,694 437,460 (46,332) 391,128 £ £ 252,016 102,104 354,120 35,258 1,750 391,128 2021	£ £ 258,677 68,012 127,661 195,673 (77,790) 117,883 376,560 (54,933) 321,627 £ £ - 281,488 281,488 31,639 8,500 321,627 2020	£ £ 258,677 68,012 127,661 195,673 (77,790) 117,883 376,560 (54,933) 321,627 £ £ - 281,488 281,488 31,639 8,500 321,627 2020

			321,627

The directors consider that the company is entitled to exemption from the requirement to have an audit under the provisions of s.477 of the Companies Act 2006. Members have not required the company, under s.476 of the Companies Act 2006, to obtain an audit for the year ended 31 December 2021.

The directors acknowledge their responsibilities for:

(a) ensuring that the company keeps accounting records which comply with Sections 386 &387 of the Companies Act 2006 and

(b) preparing financial statements which give a true and fair view of the state of the affairs of the company as at 31 December 2021 and of its surplus or deficit for the year then ended in accordance with the requirements of ss.394 & 395 and which otherwise comply with the requirements of the Act, relating to the financial statements, so far as applicable to the company.

These financial statements, which have been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 applicable to small companies were approved by the Trustees on 9 May 2022 and signed on its behalf. MH Bryan

……………………..

M Bryan

Director

The notes on pages 8 to 12 form part of these financial statements

Page 7

Arts Factory Ltd

Notes to the financial statements for the year ended 31 December 2021

1 Accounting policies

Basis of preparation

The financial statements have been prepared in accordance with 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) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Arts Factory Ltd meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s).

Income

(i) donations and similar income

Donations and similar income is recognised when received.

(ii) revenue grants

Revenue grants are generally recognised in the period in which they are received.

(iii) capital grants

Capital grants are recognised as the corresponding expense is incurred.

(iv) other income

All other income is recognised in the period to which it relates.

Expenditure and irrecoverable VAT

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:

Charitable expenditure comprises those costs incurred by the charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and those costs of an indirect nature necessary to support them.
Governance costs include those costs associated with meeting the constitutional and statutory requirements of the charity and include the accountancy fees and costs linked to the strategic management of the charity.

Tangible fixed assets

Fixed assets are stated in the balance sheet at cost less depreciation.

Depreciation is provided in order to write off the cost of fixed assets over their estimated useful lives in equal annual instalments, as follows :

Motor Vehicles	25% on cost
Computer equipment	25% on cost
Tools and equipment	25% on cost

Pension costs

The company operates a defined contribution scheme for the benefit of its employees. Contributions payable are recognised in the statement of financial activities when due.

Page 8

Arts Factory Ltd

Notes to the financial statements (continued) for the year ended 31 December 2021

1 Accounting policies cont'd

Fund accounting

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objectives of the charity. Designated funds are unrestricted funds earmarked by the Trustees for particular purposes.

Restricted funds are subjected to restrictions on their expenditure imposed by the donor.

2 Legal status

The Arts Factory is a company limited by guarantee and has no share capital.

3 Donations and legacies

Unrestricted £ 13,592	2021 £ 13,592	2020 £ 1,670
13,592	13,592	1,670
Unrestricted £ 199,119 9,134 16,689 329	2021 £ 199,119 9,134 16,689 329	2020 £ 142,626 6,217 19,124 78
225,271 - - - - - 18,750 - 1,423	225,271 49,929 54,792 6,750 14,647 24,304 18,750 10,000 68,076	168,045 58,004 - 6,750 26,555 41,604 2,935 28,927 123,313
245,444	472,519	456,133
Unrestricted £ 80,990 58,611 19,910 17,548 1,981	2021 £ 193,056 164,311 19,910 28,118 1,981	2020 £ 161,379 133,876 19,511 20,843 2,988
179,040 1,950 544	407,376 1,950 544	338,597 2,250 -
181,534	409,870	340,847

Page 9

Arts Factory Ltd

Notes to the financial statements (continued) for the year ended 31 December 2021

6 Net income for the year

The net income for the year is stated after charging:

Depreciation of tangible fixed assets: owned by the charity Accountancy fees	2021 £ 7,478 1,950	2020 £ 7,485 2,250

7 Staffing and trustee remuneration

Staff costs Wages and salaries Social Security costs Pension costs	2021 £ 146,970 6,976 6,670 160,616	2020 £ 125,817 2,965 4,191
		132,973

During the year the average number of employees was 11 (2020: 9). No employee received employee benefits in excess of £60,000 (2020: Nil).

No remuneration was paid to any trustees during the year nor any expenses reimbursed (2020: £Nil).

8 Tangible fixed assets COST As at 1 January 2021 Additions Disposals At 31 December 2021 DEPRECIATION As at 1 January 2021 Charge for period On Disposals At 31 December 2021 NET BOOK VALUE At 31 December 2021 At 31 December 2020	Land & buildings £ 371,153 - - 371,153 121,153 - - 121,153 250,000 250,000	Tools & equipment £ - 2,567 - 2,567 - 641 - 641 1,926 -	Motor vehicles £ 7,350 - - 7,350 3,676 1,837 - 5,513 1,837 3,674	Computer equipment £ 105,819 - - 105,819 100,816 5,000 - 105,816 3 5,003	Total
					£ 484,322 2,567 -
					486,889
					225,645 7,478 -
					233,123
					253,766
					258,677

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Arts Factory Ltd

Notes to the financial statements (continued) for the year ended 31 December 2021

9 Debtors

Grants receivable Trade debtors Other debtors and prepayments Creditors: amounts falling due within one year Bank loans and overdrafts Trade creditors Taxes and social security Other creditors Accruals Creditors: amounts falling due after more than one year Bank loans Other creditors	2021 £ 18,466 34,826 - 53,292 2021 £ 7,600 8,716 9,621 1,304 6,250 33,491 2021 £ 46,332 - 46,332	2020 £ 44,305 9,698 14,009
		68,012
		2020 £ 6,600 52,356 4,157 1,470 13,207
		77,790
		2020 £ 54,933 -
		54,933

10 Creditors: amounts falling due within one year

11 Creditors: amounts falling due after more than one year

12 Designated funds

Tangible Fixed Assets fund	Balance at New beginning designations of year £ £ - 252,744	Utilised/ released £ (7,478)	Transfer t/f capital grant funds £ 6,750	Balance at end of year £ 252,016

The tangible fixed assets fund represents the net book value of the charity's unrestricted tangible fixed assets. The fund has been created to recognise the fact that the tangible fixed assets are required for the day to day operations of the charity and are not available for other purposes or for general reserves.

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Arts Factory Ltd

Notes to the financial statements (continued) for the year ended 31 December 2021

13 Restricted income funds

Social Services Learning Disability SLA Active Inclusion Grant Arnold Clark Community fund CFW Resiliance Fund Community Capacity Grant: Dementia ICF Reminiscence Fund ICF renovation grant ICF Dementia Grant 2020-21 ICF Dementia Grant Recovery & reconnect Interlink Big Lunch Grant Interlink Sydney Albert Fund Interlink WG Volunteer Resilience Grant Interlink Youth Grant Interlink Kindness Grant Interlink Winter Pressures Grant Kickstart Grant Millenium Stadium Grant fund Moondance Foundation NRW Rhondda Fach Garden Project Pen y Cymoedd Windfarm Revenue Grant Peoples First Grant RCT Adult Changing Room Fund RCT Foodshare Fund RCT Parent & Toddler Grant RCT Summer of Fun Grant RCT Age Cymru Grant RCT Youth grant Waterloo Foundation Capital Grant Release Total funds 14 Capital grants funds Balance at 1 January 2021 Income for the year Expenditure for the year : release to income Balance at 31 December 2021	Balance at beginning of year £ - - - 1,839 1,602 3,389 - - - - - - - - - - 1,365 9,670 (4,485) - 9,800 - 500 - - - - 7,959 - 31,639	Income in year £ 49,929 24,304 1,000 - - - 54,792 4,878 6,025 250 1,680 8,300 343 1,500 7,685 2,511 - - 21,750 14,647 - 4,000 - 993 3,900 500 1,338 10,000 6,750 227,075	Expenditure in year £ 49,929 28,101 1,014 1,839 1,602 3,431 54,792 5,660 1,878 378 1,104 6,816 343 - - 1,011 1,385 9,670 17,265 14,647 - 4,000 500.00 997 3,258 592 1,339 10,035 6,750 228,336 Pen y Cymoedd £ 5,000 - (5,000) -	Transfer t/f unrestricted funds £ - 3,797 14 - - 42 - 782 - 128 - - - - - - 20 - - - - - - 4 - 92 1 - - 4,880 Coalfields £ 3,500 - (1,750) 1,750	Balance at end of year £ - - - - - - - - 4,147 - 576 1,484 - 1,500 7,685 1,500 - - - - 9,800 - - - 642 - - 7,924 -
					35,258
					Total £ 8,500 - (6,750)
					1,750

15 Analysis of net assets between funds

Unrestricted funds Designated funds General income fund Restricted income funds Restricted capital grant funds Total funds	Tangible fixed assets £ 252,016 - - 1,750 253,766	Net current assets £ - 148,436 35,258 - 183,694	Long term liabilities £ - (46,332) - - (46,332)	Total £ 252,016 102,104 35,258 1,750
				391,128

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