Charity Registration No. 1204669 (England and Wales)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
CONTENTS
| Page | |
|---|---|
| Legal and Administrative Information | 1 |
| Report of the Trustees | 2 |
| Independent Auditors’ Report | 10 |
| Statement of Financial Activities | 14 |
| Balance Sheet | 15 |
| Statement of Cash Flows | 16 |
| Notes to the Financial Statements | 17 |
CIRCULAR BIOECONOMY ALLIANCE LEGAL AND ADMINISTRATIVE INFORMATION
Trustee Dame Amelia Chilcott Fawcett (Chair) (Appointment 12 September 2023) Francis Vijay Narasimhan Rangarajan (Appointment 5 Oct 2023) Professor Nathalie Seddon (Appointment 12 September 2023) Professor Hans Joachim Schellnhuber (Appointment 12 September 2023) Tanya Margaret Anne Steel (Appointment 12 September 2023) Chief Executive Officer Marc Palahi Chief Financial and Operating Paula Wilson Officer Registered office 71 Queen Victoria Street London, EC4V 4BE Bankers HSBC 31 Holborn Holborn Circus London EC1N 2HR Independent Statutory Auditor Saffery LLP 71 Queen Victoria Street London EC4V 4BE Solicitors Charles Russell Speechlys 5 Fleet Place London EC4M 7RD Charity Registration No. 1204669
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
The Trustees of Circular Bioeconomy Alliance present their annual report and financial statements for the first period of accounts for the seven-month period ended 31 March 2024, which are also prepared to meet the requirements of a directors’ report.
The financial statements have been prepared in accordance with the Charities Act 2011, the Memorandum and Articles of Association and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing accounts in accordance with the Financial Reporting Standard (FRS 102). The legal and administrative information on page 1 forms part of this report.
Constitution and governance
CBA is constituted as a Charitable Incorporated Organisation (CIO) with a constitution dated 12[th] of September 2024 as its governing documents.
The Objects of the CBA as set out in its constitution are as follows:
To promote for the public benefit the conservation, protection, and improvement of the physical and natural environment, in particular, but not exclusively, by the transformation of degraded land into regenerative landscapes that are biodiversity positive and climate neutral.
To promote sustainable development for the benefit of the public by:
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the preservation, conservation and the protection of the environment and the prudent use of resources.
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the relief of poverty and the improvement of the conditions of life in socially and economically disadvantaged communities; and
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the promotion of sustainable means of achieving economic growth and regeneration of nature
To advance the education of the public in subjects relating to sustainable development and the protection, enhancement and rehabilitation of nature and the environment and to promote study and research in such subjects provided that the useful results of such research which are disseminated to the public at large.
Sustainable development means “development which meets the needs of the present without compromising the ability of future generations to meet their own needs.”
The CBA constitution states there must be a minimum of 3 trustees serving on the CBA Board, up to a maximum of 9 trustees. A Founder Member may nominate a trustee for consideration to the Board but must remain in, the minority of the total number of charity trustees appointed at any one time. It is the Boards full discretion to appoint a new trustee. A new trustee would be appointed for a term of three years.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
The CBA will make available to each new charity trustee, on or before his or her first appointment, a copy of the constitution and any amendments made to it; and a copy of the CBA's latest trustees' annual report and statement of accounts.
The CBA will also arrange key meetings with the Executive Team and any key stakeholders to induct the new trustee. If additional training is highlighted as part of this process, the CBA will resource this training.
The inaugural charity trustees of the CBA have been “hand” selected and were chosen to help establish the charity through their dedicated years of service and experience with other charitable and business organisations. The CBA needed a cross-section of individuals from legal, finance, charity, government and the scientific community.
In selecting future individuals to be appointed as a charity trustee, the trustees will have regard to the skills, knowledge and experience needed for the effective administration of the CBA. In doing so, they would review the skills already represented on the Board.
The Executive Team will assist in this process by keeping a record of any trustee prospects, including biographies of candidates on which basic due diligence will have been completed.
CBA has a small core team, headquartered in London, with team members either directly employed by or engaged through collaboration or service agreements with the European Forest Institute to enable the CBA activities.
The CBA has dedicated support from its governance committee, the Board of Trustees, and advisory services from the Scientific Advisory Board. Each Board represents a large and diverse range of well-known global leaders and experts in their field.
Day-to day operational control of the CBA is delegated by the Board of Trustees to the Chief Executive Officer and key management personnel listed on page 1, who are responsible for the direction and success of the strategy, in line with the CIO’s charitable objects.
Remuneration for key management is set reviewing the skills and experience of the candidate for the role and responsibilities. The position is benchmarked against similar positions in the sector. Due to the technical and international expertise needed for some positions, salary comparison may not be available.
Currently the role of the Chief Executive Officer is a seconded position from Lombard Odier and is on a part-time basis.
In addition, support was provided for the initial set up of The Circular Bioeconomy Alliance by the European Forest Institute. This has not been included as a gift in kind as the charity cannot reliably estimate the value.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
The Board of Trustees remains responsible for ensuring that the CBA functions within the legal and financial requirements of a registered charity, for approving long-term objectives and strategy, and approving the annual budget and any material variations.
Trustees do not receive any benefit or payment in connection with their services to the CBA, but travel and subsistence may be reimbursed. (2024:NIL)
CIRCULAR BIOECONOMY ALLIANCE STRATEGY OBJECTIVES
The Circular Bioeconomy Alliance initiative was established in 2020 by His Majesty King Charles III (formerly His Royal Highness The Prince of Wales).
In September 2023, the Circular Bioeconomy Alliance became a registered charity. It intends to build upon the successes of the initiative bearing the same name which was hosted by the European Forest Institute, and which had become a leading collaborative platform with around fifty members including scientific organisations, corporations, banks and funds, Indigenous peoples, NGOs, and companies.
The CBA provides funding, expertise, and know-how to facilitate projects designed to accelerate the transition to a circular bioeconomy that is climate neutral, inclusive and prospers in harmony with nature.
Mission
The CBA’s vision is a world powered by and prospering in harmony with Nature. The CBA’s mission is accelerating the transition to a nature-first economy.
The CBA aims to accelerate the transition to a nature-first circular bioeconomy that is climate neutral, inclusive and powers prosperity.
Striving for Impact
The CBA, through the principle of a circular bioeconomy, offers a conceptual framework for using renewable natural capital to holistically transform and manage our land, food, health, and industrial systems as well as our cities. Putting forward a new economic model will require transformative policies, purposeful innovation, access to finance, risk-taking capacity as well as new and sustainable business models and markets.
Delivering Objectives
Living Labs
The CBA collaborates with scientists, Indigenous communities, corporates, and local governments to develop Living Labs. These are pilots of nature-first economies, using sustainable value chains to holistically regenerate landscapes and power prosperity in the local community.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Connecting the dots
We deliver transformative impact at scale through:
Activating and demonstrating: creating scalable ‘proof of concept’ through a global network of Living Labs that blend science, technology, and Indigenous knowledge to holistically regenerate landscapes, support communities and rethink value chains.
Advancing and sharing knowledge: scaling learning-to-action by supporting research, communication and capacity building through leading experts, rigorous scientific frameworks and data and inclusive programmes.
Connecting and facilitating: developing targeted global-to-local partnerships, to advocate for and advance global efforts through a diverse network of leading scientists, pioneering corporations, Indigenous communities, campaigning organisations, and public institutions.
Grants
During the 2023/34 financial year, the CBA awarded one grant to the Amazon Sacred Headwaters Alliance for £4,058. This was to fund an Indigenous Leader from the Amazon to attend COP28.
Advocacy and Engagement
The CBA will freely disseminate and actively promote our charitable activities in the future to the widest audiences. We hope that the charitable ‘Living Labs’ will serve as a blue print for organisations to adopt and we would encourage this.
At COP28, the Circular Bioeconomy Alliance (CBA) called on leaders from across government, corporate, finance and civil society spheres to play their part in creating regenerative landscapes, and sustainable communities and markets.
At an event co-hosted with the UK Government on 2 December 2023 at COP28, efforts to ‘put nature, people and livelihoods at the heart of climate action’, the CBA brought together leading voices to highlight the critical role of nature, and the circular bioeconomy it powers, in driving the transition to a net-zero, climate positive and inclusive economy. When properly valued by economic systems, nature’s benefits can help to address complex global and interconnected crises.
The Wildfire-Resilient Landscapes Network was launched at a reception in Dubai attended by His Majesty King Charles III, on 30 November ahead of the start of COP28. The network brings together Indigenous and scientific knowledge to develop Living Labs that demonstrate how to create resilient landscapes to deal with the increasing problem of wildfires in fire-prone areas of the world. The initiative will work with the finance industry to develop innovative financial tools (for example around emerging Nature markets) that can generate the
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
necessary investments to support the transition to resilient landscapes. The founding of the network was inspired by The King’s interest in linking Australia’s indigenous fire experts with Canadian experts to share best practices following Canada’s horrific fire season.
Finally, a new publication from the CBA explores the role the circular forest-based bioeconomy could play, to fulfil African aspirations and answer many of these current and future challenges. As Africa consists of 54 countries with vast differences between them and the forests which they contain, the study takes an in-depth look at five different countries: Gabon, Kenya, Nigeria, South Africa, and Tanzania.
Future Considerations
As a newly established charity, the CBA is focused on shaping the charitable activities for the future years. For more than a hundred years we have relied on an extractive economy powered by fossil resources that has developed at the expense of Nature.
While a variety of regenerative and circular strategies are being pursued to advance this goal, there is no cohesive approach or means to scale. Time is running out to deliver the collective and integrated action that is needed, to put the world on a path towards sustainable economic growth.
The CBA expects to see momentum on designing and implementing charitable ‘Living Labs’, creating impact at scale, building sustainable value chains which transform our land, food, health, and industrial systems.
Our visionary approach combines a rigorous science-based framework, coalitions of expert willing partners, Indigenous and local leaders, and a bespoke ‘Living Lab’ activation model.
Other priority areas for the CBA in 2024/25 will be a scoping exercise for a grants programme and scientific research in priority areas.
Additionally, the CBA has set priorities for underlying operations to ensure the CBA continues as a strong, resilient organisation, as follows:
Finance – Growing our charitable income through general and targeted fundraising and working with donors to support our ‘Living Labs’.
People – Ensuring the people needed to deliver against our charitable aims are in place, through retaining, growing, and establishing collaborations and recruiting the “best people”.
Affiliate Network – Support our affiliate network members and continue to recruit new members, to help support the CBA charitable activities.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Grant Making Policy
The Trustees have delegated to the Executive Team the ability to award small grants (under £10,000) to external organisations to further the vision and mission of the CBA.
Fundraising
The CBA is committed to maintaining the highest standards in our fundraising activities. We adhere to the Code of Fundraising Practice and ensure that all our fundraising efforts are ethical and transparent.
The CBA would like to thank our Founder Members; Lombard Odier, AstraZeneca and LVMH who have funded the CBA since its incorporation as a CIO.
The Trustees take their responsibility under the Charities (Protection and Social Investment) Act 2016 seriously and have considered the implications for the Charity’s activities. The Charity does not seek donations from the general public. The Charity does not engage any professional or third-party fundraisers. No complaints were received during the year in relation to fundraising. The Trustees are therefore satisfied that it is not necessary for the Charity to have a formal fundraising policy at this time.
However, since the end of the reporting period, the CBA has registered with the Fundraising Regulator, and we will ensure that all our activities are conducted in accordance with their standards. We will also provide training to our staff and volunteers to ensure they are aware of and adhere to these regulations.
We respect the privacy of our donors and are committed to protecting their personal information. We comply with the General Data Protection Regulation (GDPR) and ensure that all donor data is securely stored and used only for the purposes for which it was collected.
Risk Management
The CBA, with the considerable and diverse experience within its staff and governance structure, is well placed to deliver on its aims. Although no steps can be taken to secure all risks, the Trustees are aware of the risk factors involved in CBA’s work and the risk register will be reviewed annually.
The CBA has a profound commitment to safeguarding, ensuring the protection of the most vulnerable in our communities. The CBA prioritise creating a safe environment for all individuals, particularly children, young people, and at-risk adults. This commitment is reflected through policies and procedures, training for staff and volunteers, and a transparent culture of accountability. Safeguarding is not just a policy; it's a fundamental ethos that guides every action and decision within the organisation.
In common with other charities dependant on donated income, one ongoing risk is that the CBA is unable to secure sufficient funding to deliver its strategy. This is an area of significant management focus and action. Securing funding for our ‘Living Labs’ is of the highest priority.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
As an organisation with a highly scientific and technical focus, a further risk is the ability both to secure and retain skilled staff. The CBA mitigates this through remuneration structures and pathways for growth. The CBA has also put in place agreements for secondments from respected organisations to grow a diverse pool of consultants to provide specialist input.
The Trustees are also conscious of reputational risk to the CBA and close stakeholders by its own actions or associated members. This is mitigated through external communications and the current and future working partners we align ourselves with.
Financial Review
Total income for the period was £3,024,255, made up of donations from our Founder Members. CBA’s expenditure for the period was £324,508, which includes support costs of £198,186. Spend in the first seven months largely consisted of support and governance costs, as the CBA was supporting the establishment of the charity.
The charity’s reserves at the year-end were £2,699,747, which consisted of £2,698,594 in unrestricted and £1,153 in designated funds which relates to a tangible fixed asset fund.
Reserves Policy
The Trustees recognise the need to have sufficient unrestricted funds held as a reserve to ensure the underlying stability should the CBA face an unexpected decline in income, unexpected cost increase or the need to respond to a change in its environment.
The level of unrestricted reserves that the Trustees believe to be appropriate and sufficient to fulfil its core commitments is defined as unrestricted reserves equivalent to circa three months of running costs, currently this is less than £200,000. Future unrestricted reserves will incorporate the delivery of our ‘Living Labs’.
The level of unrestricted reserves at 31 March 2024 stands at £2,699,747, or approximately 13.5 months of running costs. This reflects the cycle of receipts of donations in our first year.
Public Benefit
The Trustees have considered the Charity Commission’s guidance on public benefit under the Charities Act 2011, and this report sets out the work performed by the CIO in furtherance of the public benefit.
Subsidiary – Circular Bioeconomy Alliance Advisors Ltd
A trading subsidiary was incorporated on the 7 November 2023 named the Circular Bioeconomy Alliance Advisors Ltd (CBAA) for the period up to the end of the 31 March 2024 the company remained dormant. However, since the period ended the CBAA has begun trading.
The subsidiary was established to provide consultancy services to organisations based on the charitable vision and mission of the CBA.
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CIRCULAR BIOECONOMY ALLIANCE REPORT OF THE TRUSTEES (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Trustees’ responsibilities statement
The trustees are responsible for preparing the trustees’ report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
The law applicable to charities in England & Wales 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 charity and of the incoming resources and application of resources of the charity for that period. In preparing these financial statements, the trustees are required to:
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select suitable accounting policies and then apply them consistently;
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observe the methods and principles in the Charities SORP (FRS102);
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make judgements and estimates that are reasonable and prudent;
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state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
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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 enable them to ensure that the financial statements comply with the Charities Act 2011, applicable accounting regulations and the provisions of the trust deed. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The trustees are responsible for the maintenance and integrity of the charity and financial information included on the charity’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions
Provision of information to the auditor
The Trustees who were in office on the date of approval of these financial statements have confirmed, as far as they are aware, that there is no relevant audit information of which the auditor is unaware. Each of the Trustees has confirmed that they have taken all the steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit information and to establish that it has been communicated to the auditor.
On behalf of the board
Dame Amelia Chilcott Fawcett Trustee 28[th] of January 2025
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CIRCULAR BIOECONOMY ALLIANCE INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Opinion
We have audited the financial statements of Circular Bioeconomy Alliance for the seven-month period ended 31 March 2024 which comprise the statement of financial activities, balance sheet, statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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give a true and fair view of the state of the charity’s affairs as at 31 March 2024 and of its incoming resources and application of resources for the period then ended;
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have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
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have been prepared in accordance with the requirements of the Charities Act 2011.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity 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 charity’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 other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other
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CIRCULAR BIOECONOMY ALLIANCE INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
information. 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. 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 course of 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.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:
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the information given in the Trustees’ Annual Report is inconsistent in any material respect with the financial statements; or
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the charity has not kept sufficient accounting records; or
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the financial statements are not in agreement with the accounting records and returns; or
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we have not received all the information and explanations we require for our audit.
Responsibilities of trustees
As explained more fully in the Trustees’ Responsibilities Statement set out on page 9, the trustees 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 charity’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 charity or to cease operations, or have no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
We have been appointed as auditors under the Charities Act 2011 and report in accordance with regulations made under that Act.
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CIRCULAR BIOECONOMY ALLIANCE INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.
Identifying and assessing risks related to irregularities:
We assessed the susceptibility of the charity’s financial statements to material misstatement and how fraud might occur, including through discussions with the trustees, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the charity by discussions with trustees and updating our understanding of the sector in which the charity operates.
Laws and regulations of direct significance in the context of the charity include the Charities Act 2011, the Charities (Accounts and Reports) Regulations 2008 and guidance issued by the Charity Commission for England and Wales.
Audit response to risks identified:
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the charity’s records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the charity’s policies and procedures for compliance with laws and regulations with members of management responsible for compliance.
During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a
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CIRCULAR BIOECONOMY ALLIANCE INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the trustees as a body, for our audit work, for this report, or for the opinions we have formed.
Saffery LLP
71 Queen Victoria Street London EC4V 4BE Statutory Auditors
Date: 28 January 2025
Saffery LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006
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CIRCULAR BIOECONOMY ALLIANCE STATEMENT OF FINANCIAL ACTIVITIES FOR THE SEVEN MONTH PERIOD ENDED 31 MARCH 2024
___________________
| Note Income from: Donations and legacies 2 Total Income Expenditure on: Raising funds Charitable activities 3 Total expenditure Net income Other (losses) /gains on foreign exchange Net movement in funds for the period Total funds brought forward Total funds carried forward 9 |
2024 Unrestricted And Total Funds £ 3,024,255 |
|---|---|
| 3,024,255 | |
| 1,704 322,804 |
|
| 324,508 | |
| 2,699,747 - |
|
| 2,699,747 | |
| - | |
| 2,699,747 |
The statement of financial activities includes all gains and losses recognised in the period. All income and expenditure derive from continuing activities.
The notes on pages 17 to 24 form part of these financial statements.
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CIRCULAR BIOECONOMY ALLIANCE BALANCE SHEET AS AT 31 MARCH 2024
| Note Fixed Assets Investment in Subsidiary 5 Tangible Fixed Assets 6 Current assets Cash at bank and in hand Prepayments and other debtors 7 Liabilities Creditors: amounts falling due within one year 8 Net current assets Net assets Funds Unrestricted funds General funds Designated funds 9 Total funds |
2024 £ 10 1,153 |
|---|---|
| 1,163 2,875,223 11,554 |
|
| 2,886,777 | |
| (188,193) | |
| 2,698,584 | |
| 2,699,747 | |
| 2,698,594 1,153 |
|
| 2,699,747 |
The notes on pages 17 to 24 form part of these financial statements.
Approved and authorised for issue on behalf of the Trustees by:
On behalf of the board
Dame Amelia Chilcott Fawcett Trustee 28[th] of January 2025
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CIRCULAR BIOECONOMY ALLIANCE STATEMENT OF CASH FLOWS
FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
| Note Net Cash provided by operating activities12 Cash flow from Investing activities: Purchase of Fixed Asset Purchase of Investment in Subsidiary Net Cash provided by investing activities Change in cash and cash equivalents in the period Change in cash and cash equivalents at the beginning of the period Change in cash and cash equivalents at the end of the period |
2024 £ (1,234) (10) |
£ 2,876,467 (1,244) 2,875,223 - |
|---|---|---|
| 2,875,223 |
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
1. Accounting policies
Circular Bioeconomy Alliance is a charitable incorporated organisation (CIO) registered with the Charity Commission for England and Wales. The registered office is 71 Queen Victoria Street, London, EC4V 4BE.
The principal accounting policies adopted, judgements and key sources of estimating uncertainty in the preparation of the financial statements are as follows:
1.1 Accounting convention
Basis of preparation
The financial statements are the first period of accounts and cover the seven-month period ended 31[st] March 2024.
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 Standards applicable in the UK and Republic of Ireland (FRS 102) – (Charities SORP (FRS 102)), the Financial Reporting Standards applicable in the UK and Republic of Ireland (FRS 102) and applicable charity law for England and Wales. The accounts have been prepared to give a ‘true and fair’ view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a ‘true and fair’ view. This departure has involved following Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005 which has since been withdrawn.
Circular Bioeconomy Alliance meets the definition of a public benefit entity under FRS 102. Assets and liabilities are recognised at the historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s).
The financial statements are prepared in sterling, which is the financial currency of the Charity. Monetary amounts in these financial statements are rounded to the nearest £.
The subsidiary has not been consolidated on the basis it is immaterial therefore these accounts are for the charity only.
1.2
Going concern
The Trustees and management of the Circular Bioeconomy Alliance have assessed the charity’s ability to continue as a going concern. As of 31[st] March 2024, we have unrestricted reserves of £2,699,747, which significantly exceed our operating expenses for the next 12 months.
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
Key considerations in our assessment include:
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Reserves: Our substantial reserves provide a strong financial cushion, ensuring continuity of operations.
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Budgets and Forecasts: We have reviewed our budgets and forecasts, considering any material uncertainties.
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Operating Environment: Despite any changes, we remain confident in our ability to fulfil our charitable objectives.
In light of the above, we believe that the Circular Bioeconomy Alliance is a going concern. We have not identified any material uncertainties that would impact our ability to continue operating.
1.3
Income
1.3.1 Donations and gifts
Income is recognised in the period in which there is probability of receipt, the charity is entitled to receipt and the amount can be measured with reasonable certainty.
1.3.2 Gifts in Kind
Donated goods or services are included in the Statement of Financial Activities as both income and expenditure at a value estimated by the Trustees based on their value to the charity, where it can be reliably estimated.
1.4 Expenditure
Expenditure is included on an accruals basis including irrecoverable VAT. Liabilities are recognised as resources expended as soon as there is a legal or constructive obligation committing the Charity to the expenditure.
1.4.1 Grants
The value of grants is recognised in full as expenditure in the period when the Charity creates a legal or constructive obligation, even where they may be multi-year in nature. Typically, this arises when an unconditional grant offer has been communicated to the recipient. The notification gives the recipient a reasonable expectation that they will receive the one year or multi-year grant.
1.4.2 Governance costs Governance costs are the costs involved in the constitutional and strategic matters of running the Charity as a legal entity.
1.4.3 Advocacy and Engagement and Other costs
Other direct and support costs are allocated to the appropriate activity as the cost is incurred.
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
1.5. Funds
- Unrestricted Funds comprise those funds, which the Trustees are free to use in accordance with the charitable objects. Designated funds are unrestricted funds of the Charity which the trustees have decided at their discretion to set aside to use for a specific purpose.
Restricted funds are funds received where the donor has indicated that they can only be spent on specific projects.
1.6. Foreign currency translation
-
Foreign currency transactions are translated into pounds sterling at the exchange rate prevailing at the transaction date. Monetary assets and liabilities are retranslated at the rate of exchange ruling at the balance sheet date.
-
1.7. Tangible Fixed Assets
Tangible Fixed Assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation.
Depreciation is charged as to write of the cost of assets over their estimated useful lives, as follows.
Asset Class Rate
Depreciation Method and
Office Equipment 33.33% Straight Line
Investment in Subsidiary
- 1.8. Investment in Subsidiary Investment recognised at cost in 100% Subsidiary Circular Bioeconomy Alliance Advisors Limited
1.9. Financial instruments
The Charity only has financial assets and liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method. There were no bank loans in the period.
1.10. Areas of judgement and uncertainties
In the application of the Charity’s accounting policies, the Trustees are required to make judgements, estimates and assumptions. These are based on historical experience and other relevant factors.
The estimates and underlying assumptions are reviewed on an ongoing basis.
In the opinion of the trustees there are no critical estimates or judgements that have affected the financial position at year end.
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
2. Donations and Legacies
2024
| £ | |
|---|---|
| Donation – unrestricted | 3,000,000 |
| Donated Services | 24,255 |
3,024,255
3. Charitable activities
2024
| Grant Giving - Amazon Sacred Headwaters Alliance Advocacy Support Costs Governance Costs |
£ 4,058 43,507 166,869 108,370 322,804 |
|---|---|
Support Costs include staff costs of £79,275 (note 4) as well as £49,200 for assistance in the development of the Strategic Framework and Financial Business plan which was outsourced to a third party. All staff time has been classified as expenditure on charitable activities for the period ended 31 March 2024 as this was the primary focus of their work. The Trustees will keep this under review as the charity evolves.
Governance costs include audit fees set out below and legal fees relation to the setup of the charity.
Net income / (expenditure) is stated after charging:
| 2024 | |
|---|---|
| £ | |
| Auditors’ remuneration (inclusive of VAT) | 17,880 |
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
4. Staff costs, trustee remuneration and expenses, and the cost of key management personnel
| Staff Costs were as follows: Salaries and Wages Social Security Costs Employer’s Contribution to defined contribution pension schemes. Temporary and other Staff Costs Gift in Kind (note 11) |
2024 £ 55,224 2,203 917 297 20,634 79,275 |
|---|---|
The total employee benefits (including pension contributions and employer's national insurance) of the key management personnel payable by the charity were £42,434.
During the period no employees received employee benefits of more than £60,000.
The average number of employees (head count based on number of staff employed) during the period was 2.
Trustees are not renumerated. During the period no expenses were reimbursed to the Trustees for directly incurred travel expenses to visit the charity partner projects and attend board meetings.
5. Investment
On 7 November 2023, the charity set up a 100% owned Subsidiary, Circular Bioeconomy Alliance Advisors Limited (company registration number 15267318).
The company was dormant in the period ended 31 March 2024
Capital and Reserves of the company at 31 March 2024 were therefore £10
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
| 6. Tangible Fixed Assets Office Equipment 2024 Cost £ At the start of the period - Additions in the period 1,234 At the end of the period 1,234 Depreciation At the start of the period - Additions in the period (81) At the end of the period (81) Net Book value at the end of the period 1,153 At the start of the period - 7. Debtors: amounts receivables within one year 2024 Prepayments 11,554 8. Creditors: amounts due within one year 2024 Accruals 100,010 Trade Creditors 84,671 Other creditors 3,512 188,193 |
Total £ - 1,234 |
|---|---|
| 1,234 | |
| - (81) |
|
| (81) | |
| 1,153 | |
| - |
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
9. Funds
| 2024 General unrestricted funds Designated funds: Fixed Asset Fund Total funds |
Funds b/fwd Incoming resources Resources expended Gains/ (Losses)/ Transfer Funds c/fwd £ £ £ £ £ - 3,024,255 (324,427) (1,234) 2,698,594 - - - (81) 1,234 1,153 |
|---|---|
| - 3,024,255 (324,508) - 2,699,747 |
Purpose of Designated Funds
To identify net funds held as fixed assets used in the organisation’s operations, which are not therefore available for working capital.
10. Analysis of net assets by fund
| 2024 | ||||
|---|---|---|---|---|
| Fixed Assets | Net Current | Creditors | Total | |
| Assets/ | ||||
| (Liabilities) | Over 1 year | |||
| £ | £ | £ | £ | |
| Funds | ||||
| Unrestricted funds | ||||
| General funds | 10 | 2,698,584 | - | 2,698,594 |
| Designated funds | 1,153 | - | - | 1,153 |
| ____ | ____ | ____ | ____ | |
| 1,163 |
2,698,584 | - | 2,699,747 | |
| ____ | ____ | ____ | ____ |
11. Related Party
Mark Palahi, Circular Bioeconomy Alliance’s Chief Executive Officer, was employed by Lombard Odier during the period, and seconded to the charity on a part time pro bono basis. A gift in kind of £20,634 is included in these accounts to reflect the trustees’ best estimate of the value to the charity of Marc’s time.
Expenditure also includes £55,448 in relation to legal fees and other costs paid by Lombard Odier on behalf of the charity. At year end, the charity owed Lombard Odier £55,448 in respect of these costs and this was paid in April 2024.
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CIRCULAR BIOECONOMY ALLIANCE NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE SEVEN-MONTH PERIOD ENDED 31 MARCH 2024
12. Reconciliation of net movement in funds to net cash flow from operating activities.
| Net income for the reporting period (as per the statement of financial activities) Adjustments for: Increase in debtors Increase in creditors Depreciation Net cash provided by operating activities 3. Analysis of changes in Net Funds At Start of Period Cashflows £ £ Cash in hand - 2,875,223 Total - 2,875,223 |
2024 £ 2,699,747 (11,554) 188,193 81 2,876,467 At end of Period £ 2,875,223 2,875,223 |
|
|---|---|---|
13. Analysis of changes in Net Funds
24