OpenCharities

This text was generated using OCR and may contain errors. Check the original PDF to see the document submitted to the regulator.

2023-03-31-accounts

REGISTERED COMPANY NUMBER: 11033978 (England and Wales) REGISTERED CHARITY NUMBER: 1180335

Report of the Trustees and Audited Financial Statements for the Year Ended 31st March 2023

for

Severn Arts (A Company Limited by Guarantee)

Richards Sandy Audit Services Limited (Statutory Auditor) Thorneloe House 25 Barbourne Road Worcester WR1 1RU

Severn Arts

Contents of the Financial Statements for the Year Ended 31st March 2023

Page
Reference and Administrative Details 1
Report of the Trustees 2 to 7
Report of the Independent Auditors 8 to 10
Statement of Financial Activities 11
Balance Sheet 12
Cash Flow Statement 13
Notes to the Cash Flow Statement 14
Notes to the Financial Statements 15 to 30
Detailed Statement of Financial Activities 31 to 32

Severn Arts

Reference and Administrative Details for the Year Ended 31st March 2023

TRUSTEES J Berrow W Davies (resigned 23.1.23) J de la Cour K A Edwards D Herbert H Perrott C V J Phillips A R Watts E S Davies O Harper (resigned 12.10.22) C Shiels REGISTERED OFFICE Suite 11 Malvern Gate Bromwich Road Worcester Worcestershire WR2 4BN REGISTERED COMPANY NUMBER 11033978 (England and Wales) REGISTERED CHARITY NUMBER 1180335 AUDITORS Richards Sandy Audit Services Limited (Statutory Auditor) Thorneloe House 25 Barbourne Road Worcester WR1 1RU SENIOR MANAGEMENT TEAM Laura Worsfold (Chief Executive Officer) Debra Fawcett (Director of Music Education) Elaine Knight (Arts Director) Alex Green (Director of Resources & Operations) Min Sowden (Director of Marketing) SOLICITORS Anthony Collins Solicitors 134 Edmund Street Birmingham B3 2ES BANKER Lloyds plc 25 Gresham Street London EC2V 7HN

Page 1

Severn Arts

Report of the Trustees for the Year Ended 31st March 2023

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 31st March 2023. 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).

INTRODUCTION

Severn Arts is the lead organisation for the delivery and operation of music education in Worcestershire. It is contracted to run the County Arts services and delivered the Arches Worcester Festivals programme as part of a DCMS/Arts Council funded Cultural Development Fund project, completed in March 2023. Severn Arts continues to project manage the full completion of the capital scheme attached to this Fund until July 2024. Severn Arts is also commissioned to manage a new community arts coordinator and programme on behalf of Malvern Hills District Council.

The Company is a registered charity with the Charity Commission (charity number 1180335).

OBJECTIVES AND ACTIVITIES Objects and Activities

The Company has widely drawn charitable Objects which focus on education, music and the arts and the promotion of social inclusion.

The Company's Objects are:

The Company's current aims are:

The principal strategies employed to achieve these aims are:

Page 2

Severn Arts

Report of the Trustees for the Year Ended 31st March 2023

ACHIEVEMENT AND PERFORMANCE

The focus for the past year has been on improving our systems and supporting staff to improve and grow our relationships with schools and teams. We appointed more staff in office management and project support and have supported three more young graduates in paid internships and placements. We have identified our gaps in provision and audited take-up from our schools resulting in more targeted marketing and improved offers. We continued to increase our income through accessing awards and grants from the Saintbury Trust, Awards for Young Musicians, Youth Music, Without Walls, Wychavon District Council, Arnold Clark Community Fund, The Community Choir, Worcester City Council, and a number of individuals donating through our website to Severn Arts Music Awards Scheme. Our total income raised was £193,280.95. We also levered in funds £141,508 for other cultural organisations through mentoring and support.

The Music Box bus has established a following and we have expanded our reach, raising the profile of Severn Arts. We were unsuccessful in our Arts Council National Portfolio Organisation (NPO) bid but have been awarded a project grant for Light Night Worcester to take place in February 2024. We have also been successful in other areas, including securing a 4-year funding agreement with Awards for Young Musicians' and Furthering Talent Connect programme. We received a legacy donation in memory of a young musician, Olly Irwin and established a bursary with the funds to support young talent, in association with BIMM Institute Birmingham in a difficult funding climate for the cultural sector, we continue to be proactive, identifying opportunity when it arises and keeping on trend with the national and regional political landscapes. We have positioned ourselves to be ready to take on the new Music Hub lead role for Herefordshire and Worcestershire from September 2024, working sensitively with our colleagues and partners. Severn arts remains a resilient, well-run organisation with committed staff and Trustees working to our end goal to improve the lives of children and young people through creative endeavour.

Worcestershire Music Education Hub

Severn Arts works in partnership with key music organisations who collectively make up the Worcestershire Music Education Hub (WMEH), which is chaired by a member of staff at the University of Worcester.

In 2022-23:

Severn Arts delivered a full concert programme involving all the orchestras and bands which rehearse weekly across the county. Concerts took place in Worcester, Malvern, Kidderminster, Droitwich, Upton-on-Severn and Bromsgrove culminating in a showcase Festival of Music concert at Worcester University Arena. This concert featured a specially commissioned work for over 250 players of all ages, instruments and abilities called 'Bewdley Bridge’. The concert also included the new Lift Off! groups for early learners.

In June 2023, the Big Sing took place in Worcester University Arena with 2000 pupils taking part from across Worcestershire. Other workshops were delivered by Orchestra Pro Anima, National Children's Choir of Great Britain and Toscana Strings.

Our partnership with MAC Makes Music continues to support young people to access music and overcome barriers. The Soundabout Choir meets monthly and has been showcased in joint projects with the Gloucestershire Soundabout Choir at Gloucester Cathedral and the Three Choirs Festival. Severn Arts is working in partnership with Malvern Cube to deliver their band development project funded by Youth Music. Severn Arts was successful in its continuation of the Furthering Talent programme delivered by Awards for Young Musicians and funded by Youth Music and is one of 10 music hubs across the country to be part of the new Furthering Talent Connector programme from March 2023 until March 2026. In January 2021 young people started their musical journey through this programme which is aimed at those exhibiting early potential but for whom financial barriers mean that they would not be able to continue their musical journey without access to this programme. During 2022-2023, the young people on the programme have taken part in a variety of Get Together events including a trip to Birmingham to see the CBSO in concert and meet the players, a workshop with Birmingham Contemporary Music Group and a workshop with musicians form the Birmingham Conservatoire Folk Ensemble. A film has been produced to showcase and promote the breadth of the Severn Arts music offer. Severn Arts also supports young people facing financial barriers through the Music Awards scheme.

Severn Arts continues to offer free access to Charanga , providing online music teaching resources to schools. In addition, we offer free access to Music First for secondary schools and a subsidised Sparkyard subscription for all schools. Severn Arts also has significant partnerships with the National Youth Orchestra`s Inspire programme, University of Worcester, Malvern Concert Club, Orchestra Pro Anima, Worcester Symphony Orchestra, and the English String Orchestra which has resulted in school concerts taking place alongside workshops.

Severn Arts has been involved in several careers' fairs and open evenings in schools across the county and has offered five work experience placements to pupils from Worcestershire high schools. Schools are supported to deliver the National Curriculum for Music through a year-long Continuous Development programme.

Page 3

Severn Arts

Report of the Trustees for the Year Ended 31st March 2023

The Music Box (bus) is out on the road delivering music technology workshops at schools and events across the county and has delivered over 40 workshops and impacted on over 800 young people during the year.

The CPD programme for all staff and schools has focused on the Model Music Curriculum with sessions on pitch and rhythm notation for the non-specialist music teacher, Ofsted Music Deep Dives, Sounds of Intent, Charanga, Big Sing and the Schools Printed Music Licence. We will be building on this offer during the next academic year and consulting with schools on the new National Plan for Music Education.

Arts Development

The arts programme delivered on behalf of Worcestershire County Council aligns with the four main aims of the Council - children and young people, business support, health and wellbeing and the environment.

This year the programme delivered a range of projects for young people to take part in, working with partners to secure additional funding, providing employment opportunities for creative practitioners, offering commissions to local artists, and sharing opportunities across the sector through a monthly newsletter.

We appointed a new Young Poet Laureate who took up the role in March 2023 and will be in place until March 2024.

We have been commissioned by Worcestershire Children First to provide artists as part of the Holiday, Activity and Food (HAF) Programme in the County, delivering workshops to nearly 2500 children and young people.

Our annual Young Voices New Visions exhibition at Worcester Cathedral took place, attracting over 50 schools. We are a partner in Reimagine Redditch, an Arts Council funded initiative to engage more people in the arts who do not traditionally participate in culture.

Malvern Hills District Council has commissioned us to deliver their community arts programme which will see a new festival and community and cultural network established and offer small grants to local groups.

The Arches Worcester Festivals - Cultural Development Fund programme

This is a time limited project funded by the Department for Culture Media and Sport (DCMS) and administered by Arts Council England, which finished in March 2023. Severn Arts continues to project manage the programme until July 2024 when the capital works will be complete

Our final Light Night was realised in February 2023, with a series of installations throughout the city centre including an indoor artist commission at St Swithun’s Church. The food and drink offer were extended with a site-specific offering of pop-up local food and drink suppliers.

Following a pilot project in November 2021, we delivered a brand-new cultural festival for young adults aged 18-30 in October 2022. The festival was co-created with 12 young adults and focused on three themes; fashion, tattooing and gaming.

We continued to work with Community Festivals creating a bespoke programme aimed at raising ambition, broadening reach and creating a long-term legacy. Worcester Music Festival, Worcester Mela and Worcester Carnival were all successful in securing funding enabling new and diverse programmes of work. Worcester Music Festival established a new strand of work in experimental mechanical music, Worcester Carnival piloted a new approach to environmentally friendly floats and Worcester Mela delivered its first traditional Mela which bought communities from across the city together to celebrate south Asian culture through creativity and colour.

Severn Arts hosted the final Arts Council England symposium (CDF round one) in Worcester in March 2023, showcasing all five of the original CDF projects.

Page 4

Severn Arts

Report of the Trustees for the Year Ended 31st March 2023

FINANCIAL REVIEW

Financial results for the year

We have seen a significant recovery in face-to-face music tuition and as a result income in this area has grown considerably. From September 2022, music tuition and schools' take-up increased and Music Education income (excluding grants and donations) this financial year was £848,539 (2022: £732,895), an increase of £115,644 from the previous year. Bands and group sessions have been slower to recover, but we are seeing strong demand from schools for engagement in whole class for the coming financial year.

The Company continues to receive substantial grant income which remains largely unchanged since last year. The Department of Education (DfE) Arts Council England grant covers costs arising from the Worcestershire Music Education Hub and was almost unchanged at £740,850 (2022: 738,857).

Grant income was received from the DCMS Cultural Development Fund Worcester Arches project finances the festivals component of the programme, and we also received income to supply project management for the overall programme.

For the full financial year, the Company’s excess income over expenditure before transfers between fund on unrestricted activities was £140,474 (2022: surplus of £51,722). Restricted activities show a deficit before transfers between funds of £65,767 (2022: surplus of £40,181). The combined surplus for the year was £74,707 (2022: deficit of £11,541).

Net assets of the Company stood at £1,245,882 (2022: £1,171,175).

Reserves policy

The current funds position of the Charity is set out in note 21 to these accounts. On 31 March 2023 the Charity had accumulated balances of £1,245,882 (2022: £1,171,175). However not all these balances are held in cash or cash equivalents.

At the year-end free reserves (unrestricted funds less fixed assets) amounted to £937,535 (2022: £871,770) and includes the £300,000 (2022: £300,000) designated fund noted below.

In order to ensure financial stability and to ensure that the Company can continue to meet its charitable objects the Trustees have agreed that a designated cash reserve of £300,000 should be held in addition to other cash and non-cash funds. This represents 4.5 months of unrestricted fund expenditure. The policy assumes that the Company is a going concern and that there is no foreseeable likelihood of it ceasing to operate. If the Company did cease to operate, then it could liquidate its non-cash assets to meet any winding up costs.

Going concern

After making appropriate enquiries, the Trustees have a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing financial statements. Further details regarding the adoption of the going concern basis can be found in the Accounting Policies.

Risk management

The Trustees have assessed the major risks to which the Charity is exposed, those related to the operations and finances of the Charity and are satisfied that systems and procedures are in place to mitigate exposure to the major risks.

In deciding on this level of reserves, the Trustees have considered the financial risks that the Charity faces, the certainty of income and the impact on users should the Charity be unable to provide its services.

The major financial risk faced is the withdrawal of grant support from DfE Arts Council England music education grant. Whilst this would have a significant impact, the Trustees expect that there would be forewarning of this which would enable them to plan appropriately. The way that DfE distributes funds as part of the music education grant is changing with effect from September 2024. The music hub areas are changing such that Herefordshire and Worcestershire will be combined into one hub. The new application process is open to anyone and thus a competitive process. However, we are in dialogue with Encore who currently operate the Herefordshire Music Education Hub and shall be applying as the lead organisation for Herefordshire and Worcestershire. We are confident in our approach, but outcomes of the application process are due to be published in April 2024. The Trustees have assessed other significant financial risks and have taken action to ensure the Company is able to respond to fluctuations in income and demand for services such that it is able to successfully deal with any immediate challenges presented.

The Trustees review the reserves policy on a regular basis with reference to trading history and by comparison with forecast projections.

Page 5

Severn Arts

Report of the Trustees for the Year Ended 31st March 2023

PLANS FOR FUTURE PERIODS

Severn Arts plans to increase business over the next few years and to diversify its income and offer to expand its reach, to cover some adult work and target disadvantaged groups throughout the county. We are at the end of our 3-year Business Plan and have a clear strategic direction that aims to focus our work as enablers, brokers and deliverers of creative education across audiences and borders... We will be expanding our music offer into Herefordshire pending the outcome of our bid to be Lead Music Hub for two counties. We are committed to a legacy programme to support grass-roots and community support for local festivals and our arts development work is developing through partnerships with our local district authorities, Worcestershire Children First, Public Health and the University of Worcester. Severn Arts is committed to growing its own workforce and to providing opportunities for career progression within the organisation, starting with apprenticeships and internships and creating sustainable roles for the future development of the music and arts education sector. We plan to work with partners to diversify our offer and ensure Severn Arts shows evidence and impact of its’ work to be an inclusive company.

STRUCTURE, GOVERNANCE AND MANAGEMENT Constitution

The Company is constituted under a Memorandum and Articles of Association dated 18 October 2017 (as amended on 19 March 2019).

Methods of appointment or election of trustees

The management of the Company is the responsibility of the Trustees who are appointed and co-opted under the terms of the Articles of Association.

All trustees have received training through annual board away days which concentrate upon the role of the board, policy and strategic direction and the evaluation and monitoring of the business plan. The trustees are invited to participate in continuous professional development programmes and are subject to a disclosure and Barring Service review. They adhere to equal opportunity recruitment policies. No new Trustees have been elected this year and one Trustee has resigned. But the establishment of a staff Trustee and Youth Voice representation is in development. A group of Trustees are preparing a succession plan and proposal to recruit at least two new Trustees this year. We have an established Finance Committee and a Music Hub Steering group with one of our trustees as a designated member.

Key management

Day to day management of the charity is delegated to the senior management team listed on the Reference and Administrative Details page.

Public benefit

The Trustees confirm that they have complied with the duty in Section 4, Charities Act 2011, to have due regard to the guidance issued by the Charity Commission concerning public benefit.

STATEMENT OF TRUSTEES' RESPONSIBILITIES

The trustees (who are also the directors of Severn Arts for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) including Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland".

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.

Page 6

Repwiofth? Trujtte forthi Yw End•d 31st Ilavch 2023 In ao far as the tnAlees a￿ wore: th•re i# no re1w￿t u)lomi8bon olthch the campwry'8 aU￿rt0r8 are gnd . ttie trusiees ho¥9 all Ste￿ Ihat Ilw ought to hav8 ta￿ trtr m•k• themse￿￿ awwe of arry reknant audit Infom￿￿00 to estsk4i¥h tttth• wdftcrfs •rg ofthyt krfoThrth. Th1$ has ten prepar•d in a[￿rd￿￿ SFdal of Part 15 ofth• CryryrN88 Ad 2(K6 ralabny to i¥ 14Zi Approved by ordor all￿ towd of ￿￿¢¢￿¥ on ............_...... . . J gn•J N8 b•WW. LILa. Jd* c￿r. Tftthi

Report of the Independent Auditors to the Members of Severn Arts

Opinion

We have audited the financial statements of Severn Arts (the 'charitable company') for the year ended 31st March 2023 which comprise the Statement of Financial Activities, the Balance Sheet, the 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 (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.

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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Report of the Independent Auditors thereon.

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 this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

Page 8

Report of the Independent Auditors to the Members of Severn Arts

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Trustees.

Responsibilities of trustees

As explained more fully in the Statement of Trustees' Responsibilities, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Our 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 a Report of the Independent Auditors 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are 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', the Companies Act 2006 (and related legislation), the Charities Act 2011 (and related legislation)), and laws and regulations relating to the employment and payment of staff including, but not limited to, the Employment Rights Act 1996, the National Minimum Wage Act 1998 and the Pensions Act 2008.

We performed audit procedures to detect non-compliances which may have a material impact on the financial statements, which included reviewing the financial statement disclosures. This includes sample testing of monthly payroll records for the calculation of gross wages, payroll taxes and pension costs.

We identified the areas of the financial statements most susceptible to fraud to be management's judgement in allocating expenditure to individual restricted and unrestricted funds, including the allocation of wage costs and general staff overheads. Audit procedures performed included, but were not limited to, reviewing managements reasoning and workings behind these allocations of expenditure.

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.

Page 9

A further de8ciWicffi ofour responsltss for th? of ￿ finan)4 •twr￿oIS il located on th• Finorthl R¢portirMJ CrA￿d1'S websrte at W1￿.1r￿0rg.Vk/auth1M[e¥￿￿1tX.fkn$. Th"s desuW)n thym pwt ofwr Report of the Independ￿ Avjitors. Us• ofour wwi Thls report L8 made sthto ts tharitabl8 mpJnber4 8s a boty, Inxcordance wFth Chaptèr3 tsfPart 18 ofthe C(#xpanies AL 2C()6. Our audit ￿tk been undertaken BO lh￿ n¥ght Slate lo the charitable I￿rn￿r9 th08è ffAtt8rs we are requlrndto statets Ihem i•portandforno other purFK6e.To the fulèstèxlenlpemltled ty 18w. we do not ac£W ¢x assune r•sponstI￿ to arbyone iJther I1￿ the Charrfat￿ company the charftable nyany'$ momborn •8 a boty. lorf￿r •LKffl thii repryL orfLYthè op(ninST￿ ha¥• fonYd. RO￿rt ￿$1￿) Rknards Isenknr St￿￿try￿AUdi1 frJr and w behslf of Rich*ds SaThfy Umit•d ISlatulNy Audltor) Thom•k4 26 Barboum R Worcosler WR1 IRU 10

Severn Arts

Statement of Financial Activities (Incorporating an Income and Expenditure Account) for the Year Ended 31st March 2023

Notes
INCOME AND ENDOWMENTS FROM
Donations and legacies
4
Charitable activities
6
Music education
Arts development
Festivals
Investment income
5
Other income
Total
EXPENDITURE ON
Charitable activities
7
Music education
Arts development
Festivals
Total
NET INCOME/(EXPENDITURE)
Transfers between funds
21
Net movement in funds
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD		 Unrestricted
funds
£
472,860
848,539
9,550
-
1,518
-
1,332,467
1,061,381
130,612
-
1,191,993
140,474
(3,305)
137,169
1,054,455
1,191,624		 Restricted
funds
£
1,244,215
-
7,000
-
-
-
1,251,215
850,560
46,352
420,070
1,316,982
(65,767)
3,305
(62,462)
116,720
54,258		 2023
Total
funds
£
1,717,075
848,539
16,550
-
1,518
-
2,583,682
1,911,941
176,964
420,070
2,508,975
74,707
-
74,707
1,171,175
**1,245,882 **		 2022
Total
funds
£
1,794,893
732,895
7,850
18,712
-
24,747
2,579,097
1,687,170
135,356
768,112
2,590,638
(11,541)
-
(11,541)
1,182,716
1,171,175

The notes form part of these financial statements

Page 11

31st IAarrh 2023 2023 TeA•l 21x22 Totol fLnds fund8 funds FIXED ASSETS Tanglbh assets 15 1190 257277 CURRENT ASSETS 08btors". amwnts falllng d4%•7llhth year 16 a77￿13 298.074 979 914 1305,976 68￿1 1361220 1377,988 CREDITORS Amowts f8Nlng wmhln one yur 17 (28BA401 IZT3.821> P95.1281 IIET CURRENT A8SErs TOTAL A88EfJ LE88 CURRE14T LiABLrrEs 1.191.622 54,200 1,246W2 1.447.364 CREDITORS Amounts falling thje aft•r nJy• than one ya 18 1278,189) NET ASSET8 1,191.622 1,246.882 1.171 175 FUNDS Unre8trirled fvJtyJ• R8strfcied fundB 21 1.191,622 1.054.455 TOTAL FUNDS 1245 882 1171175 Th•a• fwcTral •i•lwnerts b•8n W•Fwed the wovMi(m •r¢abkn to tr)mpanl•i Th• fln8rKJel 8talernenl¥￿1I 8pprv40d tythe BoaTd OlTNste•s￿￿ •Jthothd fuw ¢xi.. . ond wr¥ slgned on ib tseh￿fby'. J,LJ, L L JdélaCour-Tr Page 12

Severn Arts

Cash Flow Statement

for the Year Ended 31st March 2023

Notes
Cash flows from operating activities
Cash generated from operations
1
Net cash (used in)/provided by operating activities
Cash flows from investing activities
Purchase of tangible fixed assets
Sale of tangible fixed assets
Interest received
Net cash used in investing activities
Change in cash and cash equivalents in
the reporting period
Cash and cash equivalents at the
beginning of the reporting period
Cash and cash equivalents at the end of
the reporting period		 2023
£
(90,919)
(90,919)
(9,299)
3,029
1,518
(4,752)
(95,671)
979,914
884,243		 2022
£
40,623
40,623
(2,232)
-
-
(2,232)
38,391
941,523
979,914

The notes form part of these financial statements

Page 13

Severn Arts

Notes to the Cash Flow Statement for the Year Ended 31st March 2023

1. RECONCILIATION OF NET INCOME/(EXPENDITURE) TO NET CASH FLOW FROM OPERATING ACTIVITIES

ACTIVITIES
2023 2022
£ £
Net income/(expenditure) for the reporting period (as per the
Statement of Financial Activities) 74,707 (11,541)
Adjustments for:
Depreciation charges 215,520 36,683
Profit on disposal of fixed assets (2,023) -
Interest received (1,518) -
Council loans converted in grant funding (276,189) -
Increase in debtors (79,909) (115,332)
(Decrease)/increase in creditors (21,507) 130,813
Net cash (used in)/provided by operations **(90,919) ** 40,623
ANALYSIS OF CHANGES IN NET FUNDS
Other
non-cash
At 1.4.22 Cash flow changes At 31.3.23
£ £ £ £
Net cash
Cash at bank
and in hand 979,914 (95,671) 884,243
979,914 (95,671) 884,243
Debt
Debts falling due
after 1 year (276,189) - 276,189 -
(276,189) - 276,189 -
Total 703,725 (95,671) 276,189 884,243

2. ANALYSIS OF CHANGES IN NET FUNDS

3. MAJOR NON-CASH TRANSACTIONS

During the year Worcestershire County Council has agreed to convert the remaining unpaid balance of loans due to them totalling £276,189 into a legal agreement that the charity will provide equivalent support to the priorities of Worcestershire County Council (see note 19).

The notes form part of these financial statements

Page 14

Severn Arts

Notes to the Financial Statements for the Year Ended 31st March 2023

1. GENERAL INFORMATION

Severn Arts is a private company, limited by guarantee, incorporated in the UK and registered in England and Wales.

The principal activity of Severn Arts is set out in the Trustees Report.

The registered office and principal operating office of Severn Arts is Suite 11, Malvern Gate, Bromwich Road, Worcester, WR2 4BN.

2. 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, except in regard to the treatment of the LGPS as if it was a defined contribution pension scheme rather than if it was a defined benefit pension scheme, which is a departure from the requirement of FRS 102, on the basis that accounting for the LGPS as a defined benefit pension scheme is inconsistent with the requirements to give a true and fair view (see the accounting policy for pension costs for more details).

The financial statements have been prepared under the historical cost convention.

The accounts are presented in GBP and are rounded to the nearest £1.

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.

Donation and grant income is recognised when the charity has been notified of the amounts. If there are performance conditions attached to the donation before entitlement can be obtained then income is deferred until those conditions are fully met or the fulfilment of those conditions is within the control of the charitable company and it is probable that they will be fulfilled.

Income from the supply of services (including income from charitable activities) represents the value of services provided to the extent that there is a right to consideration and is recorded at the fair value of the consideration received or receivable.

Interest income is recognised for all interest-bearing financial instruments on an accrual basis.

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 as detailed below.

Charitable activity costs are those costs that relate directly to specific activities within the organisation.

Supports costs include the running costs of the charity and have been attributed to direct costs of charitable activities as follows:

Page 15

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

2. ACCOUNTING POLICIES - continued

TANGIBLE FIXED ASSETS

Tangible fixed assets are initially recognised at cost. After recognition, under the cost model, tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. All costs incurred to bring a tangible asset into its intended working condition should be included in the measurement of cost.

A review for impairment of fixed assets is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the Statement of financial activities.

Tangible fixed assets costing £500 or more are capitalised.

Depreciation is provided at rates calculated to write off the cost of fixed assets, less their estimated residual value, over their expected useful lives on the following bases:

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.

Page 16

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

2. ACCOUNTING POLICIES - continued

FINANCIAL INSTRUMENTS

The company has elected to apply the provisions of Section 11' Basic Financial Instruments' and Section 12 'Other Financial Instruments Issues' of FRS 102 to all of its financial instruments.

Financial instruments are recognised when the company becomes party to contractual provisions of the instrument.

Financial assets are offset, with the net amounts presented in the accounts where there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic Financial Assets

Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Basic Financial Liabilities

Basic financial liabilities, including trade and other payables, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of future receipts, discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of the operations from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction cost.

OPERATING LEASES

Rents payable under operating leases are charged to the Statement of Financial Activities on a straight line basis over the lease term.

PENSION COSTS

Retirement benefits to employees of the charity are provided by either the Teachers' Pension Scheme ('TPS'), the Local Government Pension Scheme ('LGPS'), or a private defined contribution scheme.

The TPS is an unfunded defined benefit scheme and contributions are calculated to spread the cost of pensions over employees' working lives with the charity in such a way that the pension cost is a substantially level percentage of current and future pensionable payroll. The contributions are determined by the Government Actuary based on quadrennial valuations using a prospective unit credit method. TPS is an unfunded multi-employer scheme with no underlying assets to assign between employers. Consequently, the TPS is treated as a defined contribution scheme for accounting purposes and the contributions recognised in the period to which they relate.

The LGPS is a funded multi-employer defined benefit scheme and the assets are held separately from those of the charity in separate trustee administered funds. Whilst it would be possible to obtain an actuarial valuation of the charity's share of the LGPS to which the charity belongs, the trustees of the charity believe that to account for the LGPS as a defined benefit pension scheme, rather than as a defined contribution scheme, would be inconsistent with the requirement to give a true and fair view. This is because the trustees do not consider their annual contributions relating to settling their share of the LGPS's current forecast deficit to be material to the accounts of the charity (based on the information provided within the most recent triennial actuarial valuation of the relevant LGPS) and also due to the very low number of members of the LGPS allocated to the charity compared to the overall number of members of the relevant LGPS, it is considered probable that the actuarial valuation of the charity's share of the deficit would be disproportionally effected by any significant uncertainty in assumptions or errors compared to other scheme employers. In addition, the minority of employees of the charity that belong to the relevant LGPS include one of the three members of the senior management team and accounting for the LGPS as a defined benefit scheme would likely cause adjustments to disclosures concerning the remuneration paid to key management personnel in such a way that is not likely to be accurately determined on an individual employee basis and would likely be less comparable year on year due to changes in actuarial assumptions applied each year to the valuation of the relevant LGPS. The trustees therefore believe that accounting for their payments to the LGPS as a defined contribution scheme better reflects the actual financial impact to the charity.

Page 17

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

2. ACCOUNTING POLICIES - continued

Where the charity has entered into an agreement with the relevant LGPS that determines how the charity will fund a deficit, the charity recognises at that point a liability for the contributions payable that arises from the agreement (to the extent that they both relate to the deficit and can be reliably measured) and the resulting expense is recognised within the Statement of Financial Activities.

Contributions payable to the defined contribution pension scheme are charged to profit or loss in the period to which they relate.

3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical areas of judgements

Judgement is applied in setting the depreciation rates for tangible fixed assets. Details to these rates can be found in the accounting policies in note 2. The carrying value of tangible fixed assets can be found in note 15.

Support costs have been allocated between unrestricted and restricted funds and between the activities where they have been identified as directly attributable costs. Any residual costs have been allocated between activities in line with the value of support costs agreed in advance by funders, multiplied by the percentage of total support costs in each heading.

4. DONATIONS AND LEGACIES

Donations
Worcestershire County Council loans
converted into grant funding (see note 19)
Grants
Orchestra tax relief		 Unrestricted
funds
£
2,141
276,189
177,257
17,273
472,860		 Restricted
funds
£
4,985
-
1,239,230
-
1,244,215		 2023
Total
funds
£
7,126
276,189
1,416,487
17,273
1,717,075		 2022
Total
funds
£
17,547
-
1,777,346
-
1,794,893

Grants received, included in the above, are as follows:

Arts Council England
The Arts Society
Awards for Young Musicians
BBC Children In Need (Youth Investment Fund)
The Childrens Society
Cultural Development Fund Grants
Malvern Hills District Council
Music Education Grant
The National Foundation for Youth Music
The Saintbury Trust
Sutton Croft
UK Association for Music Education
Worcestershire County Council Funding
Sundry small grants		 2023
£
56,242
2,000
29,571
-
-
414,011
7,015
740,850
8,548
2,000
29,230
7,400
119,562
58
**1,416,487 **		 2022
£
56,243
-
-
18,348
10,200
749,562
-
738,857
19,932
-
26,360
12,600
132,317
12,927
1,777,346

Page 18

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

5.
INVESTMENT INCOME
Unrestricted
funds
£
Bank interest
1,518
6.
INCOME FROM CHARITABLE ACTIVITIES
Music
education
£
CPD income
1,740
Event income
5,253
Project income
-
Resources
31,693
Tuition
793,793
Subscriptions
9,774
Concerts
3,886
Miscellaneous income
2,400
848,539
7.
CHARITABLE ACTIVITIES COSTS
Music education
Arts development
Festivals
8.
DIRECT COSTS OF CHARITABLE ACTIVITIES
Staff costs
Instrument consumables
Workshop expenditure
External funding and bursary
Project costs
Subcontracted staff costs		 Restricted
funds
£
-
Arts
development
£
-
-
16,550
-
-
-
-
-
16,550
Direct
Costs (see
note 8)
£
1,429,384
165,529
384,993
1,979,906

Page 19

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

9. SUPPORT COSTS

Management
£
Music education
476,965
Arts development
10,973
Festivals
33,419
521,357
Support costs, included in the above, are as follows:
Music
Arts
education
development
£
£
Rates and water
2,341
193
Insurance
9,572
789
Light and heat
7,100
585
Telephone
5,008
413
Advertising
16,808
-
Sundries
2,752
111
Service charges
11,517
949
Rent
27,334
2,252
Travel expenses
73,811
1,937
IT expenses
29,452
1,272
Legal and professional
7,593
626
Accountancy and payroll
11,460
942
Conference costs
1,311
-
Subscriptions
2,918
-
Board costs
1,820
-
Premises costs
10,489
864
CPD costs
4,399
-
Venue hire
19,516
-
Safeguarding costs
2,738
-
Consultancy fees
15,038
-
Postage and stationary
491
40
Depreciation
215,520
-
Profit on sale of tangible
fixed assets
(2,023)
-
Bank charges
1,343
111
Redundancy
-
-
Auditors' remuneration
4,249
351
482,557
11,435		 Governance
Finance
costs
£
£
1,343
4,249
111
351
398
1,260
1,852
5,860
2023
Total
Festivals
activities
£
£
692
3,226
2,828
13,189
2,098
9,783
1,480
6,901
-
16,808
397
3,260
3,403
15,869
8,076
37,662
1,017
76,765
4,563
35,287
2,243
10,462
3,378
15,780
-
1,311
-
2,918
-
1,820
3,099
14,452
-
4,399
-
19,516
-
2,738
-
15,038
145
676
-
215,520
-
(2,023)
398
1,852
-
-
1,260
5,860
35,077
529,069		 Totals
£
482,557
11,435
35,077
529,069
2022
Total
activities
£
3,225
14,820
7,195
8,646
23,500
2,453
13,944
40,034
56,359
51,419
29,139
21,162
167
5,363
1,916
8,657
4,985
10,296
2,895
75,455
757
36,683
-
1,641
41,750
5,130
467,591

10. NET INCOME/(EXPENDITURE)

Net income/(expenditure) is stated after charging/(crediting):

Depreciation - owned assets
Surplus on disposal of fixed assets
Rent paid under operating leases		 2023
£
215,520
(2,023)
**37,662 **		 2022
£
36,683
-
40,034

Page 20

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

11. AUDITORS' REMUNERATION

Audit remuneration
TPS EOYC audit
Other services		 2023
£
5,860
1,920
7,770
15,550		 2022
£
5,160
2,094
13,278
20,532

12. TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 31st March 2023 nor for the year ended 31st March 2022.

TRUSTEES' EXPENSES

No trustees were reimbursed for expenses during the current or prior year.

13. STAFF COSTS

Wages and salaries
Social security costs
Other pension costs		 2023
£
1,174,733
88,279
192,402
1,455,414		 2022
£
1,115,955
76,661
183,351
1,375,967

Included within the above gross wages are redundancy payments of £nil (2022: £41,750)

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

2023 2022
Average number of employees **87 ** 75
The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 w
2023 2022
£60,001 - £70,000 1 1

The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was:

Key management personnel remunerations

During the year total remuneration, including employer pension and national insurance costs, paid to key management personnel totalled £269,962 for 5 employees (2022: £224,941 for 4 employees).

Page 21

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

14. COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES

INCOME AND ENDOWMENTS FROM
Donations and legacies
Charitable activities
Music education
Arts development
Festivals
Other income
Total
EXPENDITURE ON
Charitable activities
Music education
Arts development
Festivals
Total
NET INCOME/(EXPENDITURE)
Transfers between funds
Net movement in funds
RECONCILIATION OF FUNDS
Total funds brought forward
TOTAL FUNDS CARRIED FORWARD
15.
TANGIBLE FIXED ASSETS
Instruments
£
COST
At 1st April 2022
502,384
Additions
8,398
Disposals
(2,353)
At 31st March 2023
508,429
DEPRECIATION
At 1st April 2022
111,067
Charge for year
196,876
Eliminated on disposal
(1,347)
At 31st March 2023
306,596
NET BOOK VALUE
At 31st March 2023
201,833
At 31st March 2022
391,317		 Fixtures
and
fittings
£
76,521
901
-
77,422
29,539
7,742
-
37,281
40,141
46,982		 Unrestricted
funds
£
116,743
688,745
6,850
-
24,747
837,085
771,979
116,828
-
888,807
(51,722)
(4,941)
(56,663)
1,111,118
1,054,455
Motor
vehicles
£
10,100
-
-
10,100
4,540
2,020
-
6,560
3,540
5,560		 Restricted
funds
£
1,678,150
44,150
1,000
18,712
-
1,742,012
915,191
18,528
768,112
1,701,831
40,181
4,941
45,122
71,598
116,720
Computer
equipment
£
44,402
-
-
44,402
23,757
8,882
-
32,639
11,763
20,645		 Total
funds
£
1,794,893
732,895
7,850
18,712
24,747
2,579,097
1,687,170
135,356
768,112
2,590,638
(11,541)
-
(11,541)
1,182,716
1,171,175
Totals
£
633,407
9,299
(2,353)
640,353
168,903
215,520
(1,347)
383,076
257,277
464,504

Page 22

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

16. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Trade debtors
Prepayments and accrued income
17.
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Trade creditors
Social security and other taxes
Other creditors
Accruals and deferred income		 2023
£
287,174
90,809
377,983
2023
£
24,528
18,262
24,086
206,745
273,621		 2022
£
61,863
236,211
298,074
2022
£
104,526
21,498
33,507
135,597
295,128

Included in accruals and deferred income above is £60,248 (2022: £12,233) of deferred income. Deferred income primarily relates to tuition paid in advance for the 2023/24 year and grants received with attached performance conditions that were unmet at the year end.

18. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

Other loans (see note 19) 2023
£
-		 2022
£
276,189

19. LOANS

An analysis of the maturity of the loan payable to Worcestershire County Council, which is repayable other than by instalments, is as follows:

Amounts falling due within one year
Amounts falling between one and five years
Amounts falling due in more than five years		 2023
£
-
-
-
-		 2022
£
-
228,571
47,618
276,189

During the year Worcestershire County Council has agreed to convert the remaining unpaid balance of the loan into a legal agreement that the charity will provide equivalent support to the priorities of Worcestershire County Council.

The loan payable to Worcestershire County Council was secured against the instruments included within tangible fixed assets (see note 15).

20. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

Within one year
Between one and five years		 2023
£
32,000
61,333
93,333		 2022
£
29,333
-
29,333

Page 23

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS

Unrestricted funds
General fund
Designated Funds
Assets transferred from Worcestershire
County Council
WCC Arts Connect
Restricted funds
Cultural Development Fund
BBC Children In Need
Bursary Fund
Changing Tracks Nurture Group
The Children's Society
COMF Enhanced Youth Support
Cultural Educational Programme
Furthering Talent
Holiday Activities & Food Programme
Inspiring Future Through The Arts
Jubilee Funding
Kickstart
Music Box Fund
Music Mark Innovation Fund
Soundabout Choir
Sundry Restricted Donations
Youth Music
TOTAL FUNDS		 At 1.4.22
£
290,247
300,000
423,788
40,420
1,054,455
7,225
19
11,831
1,500
892
1,019
6,270
23,053
6,070
1,604
6,947
808
13,974
10,800
-
265
24,443
116,720
1,171,175		 Net
movement
in funds
£
128,639
-
-
11,833
140,472
-
(19)
4,683
(1,500)
(892)
(1,019)
950
(9,907)
685
(1,604)
(6,947)
(1,260)
(13,137)
(10,800)
(500)
(55)
(24,443)
(65,765)
**74,707 **		 Transfers
between
funds
£
420,483
-
(423,788)
-
(3,305)
-
-
-
-
-
-
-
-
-
-
-
452
2,353
-
500
-
-
3,305
-		 At
31.3.23
£
839,369
300,000
-
52,253
1,191,622
7,225
-
16,514
-
-
-
7,220
13,146
6,755
-
-
-
3,190
-
-
210
-
54,260
**1,245,882 **

Page 24

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS - continued

Net movement in funds, included in the above are as follows:

Unrestricted funds
General fund
WCC Arts Connect
Restricted funds
Music Education Grant
Cultural Development Fund
BBC Children In Need
Bursary Fund
Changing Tracks Nurture Group
The Children's Society
COMF Enhanced Youth Support
Cultural Educational Programme
Furthering Talent
Holiday Activities & Food Programme
Inspiring Future Through The Arts
Jubilee Funding
Kickstart
Music Box Fund
Music Mark Innovation Fund
Soundabout Choir
Sundry Restricted Donations
Youth Music
TOTAL FUNDS		 Incoming
resources
£
1,185,868
146,599
1,332,467
740,850
420,070
-
4,983
-
-
-
1,000
29,571
29,230
-
8,519
1,045
2,000
7,400
-
-
6,547
1,251,215
**2,583,682 **		 Resources
expended
£
(1,057,229)
(134,766)
(1,191,995)
(740,850)
(420,070)
(19)
(300)
(1,500)
(892)
(1,019)
(50)
(39,478)
(28,545)
(1,604)
(15,466)
(2,305)
(15,137)
(18,200)
(500)
(55)
(30,990)
(1,316,980)
**(2,508,975) **		 Movement
in funds
£
128,639
11,833
140,472
-
-
(19)
4,683
(1,500)
(892)
(1,019)
950
(9,907)
685
(1,604)
(6,947)
(1,260)
(13,137)
(10,800)
(500)
(55)
(24,443)
(65,765)
**74,707 **

Page 25

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS - continued

Comparatives for movement in funds

Unrestricted funds
General fund
Designated Funds
Assets transferred from Worcestershire
County Council
WCC Arts Connect
Restricted funds
Cultural Development Fund
BBC Children In Need
Bursary Fund
Changing Tracks Nurture Group
The Children's Society
COMF Enhanced Youth Support
Cultural Educational Programme
Furthering Talent
Holiday Activities & Food Programme
Inspiring Future Through The Arts
Jubilee Funding
Kickstart
Music Box Fund
Music Mark Innovation Fund
Soundabout Choir
Sundry Restricted Donations
Youth Music
TOTAL FUNDS		 At 1.4.21
£
325,432
300,000
448,165
37,521
1,111,118
7,063
-
3,345
-
-
-
5,270
7,724
-
10,632
-
-
11,843
-
-
265
25,456
71,598
1,182,716		 Net
movement
in funds
£
(30,244)
-
(24,377)
2,899
(51,722)
162
925
3,486
1,500
892
1,019
1,000
15,329
6,070
(9,028)
6,947
1,991
2,131
10,800
(2,030)
-
(1,013)
40,181
(11,541)		 Transfers
between
funds
£
(4,941)
-
-
-
(4,941)
-
(906)
5,000
-
-
-
-
-
-
-
-
(1,183)
-
-
2,030
-
-
4,941
-		 At
31.3.22
£
290,247
300,000
423,788
40,420
1,054,455
7,225
19
11,831
1,500
892
1,019
6,270
23,053
6,070
1,604
6,947
808
13,974
10,800
-
265
24,443
116,720
1,171,175

Page 26

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS - continued

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

Unrestricted funds
General fund
Assets transferred from Worcestershire
County Council
WCC Arts Connect
Restricted funds
Music Education Grant
Cultural Development Fund
Arts Council TPS Grant
BBC Children In Need
Bursary Fund
Changing Tracks Nurture Group
The Children's Society
COMF Enhanced Youth Support
Cultural Educational Programme
Furthering Talent
Holiday Activities & Food Programme
Inspiring Future Through The Arts
Jubilee Funding
Kickstart
Music Box Fund
Music Mark Innovation Fund
Soundabout Choir
Youth Music
TOTAL FUNDS		 Incoming
resources
£
717,358
-
119,727
837,085
738,857
768,274
56,243
18,348
3,486
1,500
3,700
4,770
1,000
32,300
27,367
9,500
12,750
6,309
23,226
12,600
-
21,782
1,742,012
2,579,097		 Resources
expended
£
(747,602)
(24,377)
(116,828)
(888,807)
(738,857)
(768,112)
(56,243)
(17,423)
-
-
(2,808)
(3,751)
-
(16,971)
(21,297)
(18,528)
(5,803)
(4,318)
(21,095)
(1,800)
(2,030)
(22,795)
(1,701,831)
(2,590,638)		 Movement
in funds
£
(30,244)
(24,377)
2,899
(51,722)
-
162
-
925
3,486
1,500
892
1,019
1,000
15,329
6,070
(9,028)
6,947
1,991
2,131
10,800
(2,030)
(1,013)
40,181
(11,541)

Unrestricted funds

- Designated Reserves

A cash reserve of £300,000 has been designated by the trustees to ensure financial stability of the charity and meet charitable objectives.

- Transferred from Worcestershire County Council

Assets (including musical instruments) donated by Worcestershire County Council upon the transfer of County Music Service undertakings to Severn Arts. This fund was required to ensure the value of assets was greater than the loan from the council as the loan was secured on the instruments, since the loan has been converted to a donation in the year, the security has ended, and as such, this fund has been transferred to general funds.

Restricted Funds

- Music Education Grant

DFE Grant allocated by Arts Council of England. Delivers core and extension roles for Music Education as set out in the National Plan for Music Education.

Grant to fund festivals element of Worcester Railway Arches Project 2019-22 (project delivered between Worcester City Council, University of Worcester and Severn Arts).

Page 27

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS - continued

Grant to fund increased Teacher Pension Scheme employer contributions.

Grant received to purchase a set of turntables and music technology equipment for the Music Box (bus).

Arts Projects for young people at risk of offending.

A photography and film project exploring the impact of Covid on young people in rural communities.

Grant to support 30 talented young musicians from disadvantaged backgrounds to further their music progression and provide mentoring and training support.

A grant to provide arts activities to vulnerable children across the County.

A grant from Worcestershire County Council to commission local artists to celebrate the Queen Jubilee.

To support and develop the delivery of Music Box music sessions.

Music Mark funded project exploring youth voice across the 14 West Midlands Music Hubs.

Inclusive Choir for young people and their families delivered in partnership with MAC Makes Music and Soundabout.

Grant to develop inclusive and accessible music opportunities, training programmes and research to improve diversity, equality and inclusion and widen reach, working with two other music Hubs in Gloucestershire and Warwickshire.

Page 28

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

21. MOVEMENT IN FUNDS - continued

TRANSFERS BETWEEN FUNDS

During the year transfers from the general unrestricted fund were made to cover overspends on the following restricted funds:

Restricted funds
Kickstart
Music Box Fund
Soundabout Choir		 £
452
2,353
500
3,305

In addition to the above, £423,788 was transferred from the designated asset fund to the general fund. The asset fund existed to ensure the value of instruments exceeded the loan with the council, since the loan has ended, this fund has been transferred to general funds.

22. EMPLOYEE BENEFIT OBLIGATIONS

The charity's employees belong to two principal pension schemes: the Teachers' Pension Scheme England and Wales (TPS) for academic and related staff; and the Local Government Pension Scheme (LGPS) for non-teaching staff, which is managed by Worcestershire Pension Fund. Both are multi-employer defined benefit schemes.

The latest actuarial valuation of the TPS related to the period ended 31 March 2016 and of the LGPS to the period ended 31 March 2019.

Included in creditors at the year end were pension creditors of £22,249 (2022: £23,345).

Teachers' Pension Scheme

The Teachers' Pension Scheme (TPS) is a statutory, contributory, defined benefit scheme, governed by the Teachers' Pension Scheme Regulations 2014. Membership is automatic for teachers. All teachers have the option to opt-out of the TPS following enrolment. The TPS is an unfunded scheme to which both the member and employer makes contributions, as a percentage of salary - these contributions are credited to the Exchequer. Retirement and other pension benefits are paid by public funds provided by Parliament.

The Government Actuary, using normal actuarial principles, conducts a formal actuarial review of the TPS in accordance with the Public Service Pensions (Valuations and Employer Cost Cap) Directions 2014 published by HM Treasury every 4 years. The aim of the review is to specify the level of future contributions. Actuarial scheme valuations are dependent on assumptions about the value of future costs, design of benefits and many other factors. The latest actuarial valuation of the TPS was carried out as at 31 March 2016. The valuation report was published by the Department for Education on 5 March 2019. The key elements of the valuation and subsequent consultation are:

The next valuation result is due to be implemented from 1 April 2024.

A copy of the valuation report and supporting documentation is on the Teachers' Pensions website.

Under the definitions set out in FRS 102, the TPS is an unfunded multi-employer pension scheme. The charity has accounted for its contributions to the scheme as if it were a defined contribution scheme.

The employer's pension costs paid to TPS in the period amounted to £150,622 (2022: £133,661), excluding adjustments in regard to holiday pay accruals.

Page 29

continued...

Severn Arts

Notes to the Financial Statements - continued for the Year Ended 31st March 2023

22. EMPLOYEE BENEFIT OBLIGATIONS - continued

Local Government Pension Scheme

The LGPS is a funded multi-employer defined benefit pension scheme, with the assets held in separate trustee administered funds.

The agreed contribution rates for future years for employers is 24.2% (less an annual deduction of £1,500) from April 2023 for the next 3 years, with employees paying variable rates depending on their level of gross wages received each month.

The charity has accounted for its contributions to the scheme as if it were a defined contribution scheme.

The employer's pension costs paid to LGPS in the period amounted to £32,256 (2022: £36,548).

Defined contribution scheme

The employer's pension costs paid to the defined contribution scheme in the period amounted to £6,695 (2022: £5,738).

23. RELATED PARTY DISCLOSURES

There were no related party transactions for the year ended 31st March 2023.

Page 30

Severn Arts

Detailed Statement of Financial Activities for the Year Ended 31st March 2023

Unrestricted
funds
£
INCOME AND ENDOWMENTS
Donations and legacies
Donations
2,141
Worcestershire County Council loans converted
into grant funding (see note 19)
276,189
Grants
177,257
Orchestra tax relief
17,273
472,860
Investment income
Bank interest
1,518
Charitable activities
CPD income
1,740
Event income
5,253
Project income
9,550
Resources
31,693
Tuition
793,793
Subscriptions
9,774
Concerts
3,886
Miscellaneous income
2,400
858,089
Other income
Government grants - CJRS
-
Total incoming resources
1,332,467
EXPENDITURE
Charitable activities
Wages
420,533
Social security
39,158
Pensions
132,001
Instrument consumables
1,242
Workshop expenditure
408
External funding and bursary
501
Project costs
90,739
Subcontracted staff costs
14,849
699,431
Support costs
Management
Rates and water
2,534
Insurance
10,361
Light and heat
7,685
Telephone
5,421
Advertising
16,808
Sundries
2,800
Carried forward
45,609		 Restricted
funds
£
4,985
-
1,239,230
-
1,244,215
-
-
-
7,000
-
-
-
-
-
7,000
-
1,251,215
754,200
49,121
60,401
-
-
2
416,751
-
1,280,475
692
2,828
2,098
1,480
-
460
7,558		 2023
Total
funds
£
7,126
276,189
1,416,487
17,273
1,717,075
1,518
1,740
5,253
16,550
31,693
793,793
9,774
3,886
2,400
865,089
-
2,583,682
1,174,733
88,279
192,402
1,242
408
503
507,490
14,849
1,979,906
3,226
13,189
9,783
6,901
16,808
3,260
53,167		 2022
Total
funds
£
17,547
-
1,777,346
-
1,794,893
-
2,055
-
70,712
24,635
636,648
23,753
1,654
-
759,457
24,747
2,579,097
1,074,205
76,661
183,351
745
216
19,693
751,651
16,525
2,123,047
3,225
14,820
7,195
8,646
23,500
2,453
59,839

This page does not form part of the statutory financial statements

Page 31

Severn Arts

Detailed Statement of Financial Activities for the Year Ended 31st March 2023

Unrestricted
funds
£
Management
Brought forward
45,609
Service charges
12,466
Rent
29,586
Travel expenses
75,655
IT expenses
30,724
Legal and professional
8,219
Accountancy and payroll
12,402
Conference costs
1,311
Subscriptions
2,918
Board costs
1,868
Premises costs
11,353
CPD costs
4,399
Venue hire
19,516
Safeguarding costs
2,738
Consultancy fees
15,038
Postage and stationary
531
Depreciation
214,200
Profit on sale of tangible fixed assets
(2,023)
486,510
Finance
Bank charges
1,454
Human resources
Redundancy
-
Governance costs
Auditors' remuneration
4,600
Total resources expended
1,191,995
Net expenditure
140,472		 Restricted
funds
£
7,558
3,403
8,076
1,110
4,563
2,243
3,378
-
-
(48)
3,099
-
-
-
-
145
1,320
-
34,847
398
-
1,260
1,316,980
**(65,765) **		 2023
Total
funds
£
53,167
15,869
37,662
76,765
35,287
10,462
15,780
1,311
2,918
1,820
14,452
4,399
19,516
2,738
15,038
676
215,520
(2,023)
521,357
1,852
-
5,860
2,508,975
**74,707 **		 2022
Total
funds
£
59,839
13,944
40,034
56,359
51,419
29,139
21,162
167
5,363
1,916
8,657
4,985
10,296
2,895
75,455
757
36,683
-
419,070
1,641
41,750
5,130
2,590,638
(11,541)

This page does not form part of the statutory financial statements

Page 32