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2021-03-31-accounts

Company number: 748773 Charity Number: 244866

Birmingham Industrial Therapy Association Limited

Report and financial statements For the year ended 31 March 2021

Birmingham Industrial Therapy Association Limited

Contents

For the year ended 31 March 2021

Reference and administrative information ...................................................................................... 1 Trustees’ annual report .................................................................................................................. 3 Independent auditor’s report ....................................................................................................... 16 Statement of financial activities (incorporating an income and expenditure account) ................... 21 Balance sheet ............................................................................................................................... 22 Statement of cash flows ................................................................................................................ 23 Notes to the financial statements ................................................................................................. 24

Birmingham Industrial Therapy Association Limited

Reference and administrative information

For the year ended 31 March 2021

Company number 748773
Country of incorporation United Kingdom
Charity number 244866
Country of registration England & Wales
Operating Name: BETTER Pathways
Registered office 201-206 Alcester Street
and operational Digbeth
address Birmingham
B12 0NQ
Trustees Trustees, who are also directors under company law, who served
during the year and up to the date of this report were as follows:
Mr Simon Lawrence Chair
Mr Ben Brittain
Dr Martin Commander
Ms Chaitali Desai
Ms Janine Garvie-Cole
Mr Jordan Kirkwood
Mr Les A Latchman
Ms Ranjit Nall
Mr Jagvir Purewal
Ms Diane Ryles
Mr Mike Smith Resigned 15 January 2021
Mr Miles Parker Appointed 15 January 2021
Mr David Tucker Appointed 15 January 2021
Key management Ms Sue Roberts Chief Executive and Company Secretary
Personnel
Bankers CAF Bank Ltd Unity Trust Bank
25 Kings Hill Avenue Four Brindley Place
Kings Hill, West Mailing Birmingham
Kent B1 2JB
ME19 4JQ
Lloyds Bank
PO Box 1000
Andover
BX1 1LT

1

Birmingham Industrial Therapy Association Limited

Reference and administrative information

For the year ended 31 March 2021

Solicitor Shakespeares Legal LLP Somerset House Temple Street Birmingham B2 5DJ Auditor Sayer Vincent LLP Chartered Accountants and Statutory Auditor Invicta House 108-114 Golden Lane LONDON EC1Y 0TL

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

The trustees present their report and the audited financial statements for the year ended 31 March 2021.

Reference and administrative information set out on pages 1 and 2 forms part of this report. The financial statements comply with current statutory requirements, the requirements of a directors’ report as required under company law, the memorandum and articles of association and the Statement of Recommended Practice - Accounting and Reporting by Charities: SORP applicable to charities preparing their accounts in accordance with FRS 102.

Aims

The aims of the Charity are set out in the Articles of Association. Our overarching purpose is to improve the well-being of people experiencing poor mental health through volunteering, work experience, employment, training and a range of therapeutic activities with the aim of growing a person’s sense of self-esteem, confidence and independence. The Charity’s objects are specifically restricted to the following:

  1. To work in partnership with people with mental health conditions to assist and empower them in their recovery and improve their mental health and wellbeing

  2. To help and support people with mental health conditions to find and keep suitable employment

  3. To provide people with mental health conditions opportunities for volunteering, work experience, training and rewarding activities

  4. To assist people with mental health conditions to find and take part in rewarding activities within their communities

  5. To raise awareness of the importance of mental health with employers and others and promote the employment of people with mental health problems

  6. To provide support to the carers of people with mental health conditions

  7. To provide material support to people with mental health conditions who are volunteering or gaining work experience at the Charity in order to help them take part in the charity’s activities.

Located in Alcester Street, Digbeth since 1973, Better Pathways supports some of the most vulnerable people in our communities, many of whom would have limited alternative sources of support were our services not available to them. Over the years, our client group has expanded. In addition to supporting people with serious mental illness, we support people with mild and moderate poor mental health and with learning disabilities and learning difficulties. We seek to understand what matters most to the people we support and to help them achieve person-centred plans that play to their strengths and develop their abilities so that their aspirations for the future can be achieved.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

The Year: 2020/2021

The impact of Covid-19 on Better Pathways was significant. We were able successfully to continue delivering our statutory sector contracts remotely and to keep open our packing and assembly social enterprise in Digbeth. Keeping our social enterprise open allowed us to continue providing services as a supply chain partner to a manufacturer of clinical cubical curtains supplied to the health care sector. We were, however, unable to have service users (participants) on site owing to the restrictions placed upon us because of the pandemic. This was true also of our social enterprise in Solihull, Express Signs, which also stayed open. The impact on participants of not being able to attend Better Pathways and Express Signs was keenly felt. We conducted regular well-being calls with everyone and secured funding to deliver an on-line Stay Well Programme. Towards the end of the year, we were able to slowly welcome more people back to our sites. At the time of writing, upwards of 65 participants, just about half, are attending.

Our non-statutory sector trading income inevitably suffered because of reduced activity in our social enterprises, with companies for whom we work either ceasing trading or reducing their requirements. Income for our statutory contracts was unaffected. We ended the year with an overall surplus of £32,680.

Our IPS employment contract came up for re-tender and we spent several months preparing for tender submission, including for an external audit of our services. Sadly, we did not win the contract, it being won instead by a major, well-established, national organisation with a vastly bigger portfolio of public sector contracts. Our IPS staff transferred with the contract at the end of March 2021. Four have since returned to work on newly won contracts being delivered by Better Pathways.

Our Charitable Services

Our Woodcraft Workshop produces items for sale made from reclaimed and donated timber. We are proud of our continuing connection with the Edinburgh Napier University, whose students designed products for our participants to craft based on a shared understanding of the skills, tools, and resources we have at our disposal. We are selling products made to the designs of the Edinburgh Napier University on our Etsy and Shopify sites.

The service focuses on improving participants’ understanding of the world of work and of what employers want. They gain valuable experience in personal organisation (getting ready for ‘work’, packing lunches, travelling to a destination on time), and in following

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

instructions and delivering work related outputs. Ultimately participating in our social enterprise improves people’s chances of securing paid employment.

Our Statutory sector services

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

If the pilot evaluates well, then we will hope for this service to be commissioned going forward.

Other income generating services: Vulnerability Awareness Training

The charity launched a new offer aimed initially at the utility sector. Three modules of

vulnerability awareness training have been developed that will support front-line agents to identify and support customers in situations of vulnerability who need tailored support to meet their needs. We were delighted to have Octopus Energy as our first customer. Additional training has been designed to support agents serving clients on the doorstep and their line managers.

At the time of writing, we are working with the Skills and Education Group to make this offer relevant within customer services qualification-based courses delivered in colleges and in the workplace.

Who benefits from our services?

Our social enterprise in Digbeth is currently supporting 65 people living in Birmingham and the immediately surrounding areas. This is fewer than in 2019/2020 (n = 136) because not all participants have yet returned, or will return, following the Covid-19 lockdown. It was not possible to run our work experience programme during the year. Its re-launch is imminent.

The people participating in our social enterprises attend to maintain good mental health and wellbeing with all having some form of learning difficulty and 10% having a diagnosed learning disability. In our packing and assembly social enterprise , males account for 82% of our 65 participants, females for 18%. Our oldest participant is in their 70s, our youngest in their 20s. Our two longest attending participants have been coming to the service for 40+ years; the shortest for one year.

The ethnic breakdown of our participants is as follows:

White British 62%; Mixed race Caribbean 1.5%; Mixed race Asian 1.5%; Chinese 1.5%; Asian 17%; Black African 1.5%; Black Caribbean 15%.

Express signs in Solihull, a much smaller service, supported nine people in the year 2019/2020. Express Signs ’ participants come with a range of unique support needs and abilities. The service is attended by six males and one female. Participants range in age from 42 – 72.

The ethnic breakdown of our seven participants is as follows:

White British x 6; Mixed race Caribbean x 1

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Our social impact

Better Pathways addresses important areas of public benefit. Unemployment in people with mental ill health is a major public health issue. Inactivity and social isolation associated with poor mental health blights the lives of sufferers and their families. We know that our work with participants succeeds in addressing the loneliness they would otherwise feel from being socially isolated, offering companionship, encouraging friendship, a sense of belonging and self-worth through all our activities.

What our participants say about us

We are proud to report below some of the positive feedback we have had from the people who participate in our services…

“I would love to be able to attend BAS three times a week, before BAS I was suicidal & never went out! BAS is a family environment, we support each other. BAS is a life saviour, has given me a sense of purpose.

A recent survey of half of the active participants revealed the following:

77% report an increased ability to make friends and build new relationships

68% report increased self confidence 74% feel supported 80% have a sense of belonging when attending our services 69% have increased ability and confidence to pick up new skills 51% indicate improved ability to deal with problems in life 63% have improved general happiness 63% have positive feelings and hope for the future

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Case Study: Support for Carers

Feedback from the family of MS

How does M coming to BAS help your family?

MS currently lives with his mum as she is shielding from covid. MS used to come to the Better Pathways every day and is keen to return for more days. But now, he supports the family to look after his mum. His sister-in-law needs to do a school run at various times of the day. MS has a lot of support and Better Pathways sits nicely with the package of other support services throughout the week, such as a foot clinic on a Friday.

What have you noticed about M as a result of his coming to BAS?

M is a lot calmer since coming to Better Pathways. He is happier and doesn’t suffer from depression and anxiety. At times a rainy day can make him anxious, following his traumatic experience from being caught in the Birmingham tornado in 2005. M really enjoys art and crafts, painting and cooking and in the past has given his sisters pieces of work that he has made, that they continue to cherish today.

Feedback from the family of KS

How does K coming to BAS help your family?

Mum and dad are K’s main carers. Better Pathways has helped them to motivate their son into a daily routine. K had questioned why his brother was able to find work and he was not. K now feels that he is doing a similar life role to his brother.

What have you noticed about K as a result of his coming to BAS?

K would often become upset that he was not able to find work. Since starting at Better Pathways he has a purpose to get out of bed each day. If K didn’t go to Better Pathways, they worry that he may start to self-harm. However, his mental health has stabilised, and K enjoys coming into Better Pathways as a form of exercise.

Economic impact: the value of our volunteer hours

‘In 2019 there were an estimated 208,000 volunteers working in 9,000 community businesses across England. These volunteers contributed up to an estimated 18 million hours of time and £250 millions of services in 2019. Volunteers provide a wide variety of support to community businesses. In 2019 the estimated average equivalent market hourly wage rate across this range of activities was around £13.70. This is slightly above the UK median hourly earnings rate for all occupations of £13.20 (by 3.5 per cent).’ Power to Change Assessing the value of volunteers in Community Businesses [2020].

65 BAS volunteers (in packing and assembly and woodcraft) will undertake 31,700 hours of volunteering in the year to March 2022. Using the average equivalent market hourly wage rate of £13.70 we arrive at an annual economic value of our volunteering activity of £434,290.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

In Express Signs, 3,168 hours will be volunteered, equating to a value of £43,402.

Financial results 2020/2021

Total income in the year decreased by 2.2% from £2,610,747 in 2019/20 to £2,552,593 in 2020/21. During the year income received from Birmingham and Solihull Clinical Commissioning Group decreased by 0.5% as planned income for IPS Wave 2 was expected to be lower. However, the total income for core activities remained unchanged during the year due to a 285% increase of grant funding for core activities.

Recovery and Employment income decreased by 39.6% from £326,806 to £197,371 mainly owing to the ending of the Neurodiverse programme in September 2019 and the Thrive into Work contract in March 2020. However, the award of the Youth Promise Plus contract in May 2020 generated income of £106,096 during the year.

Income for the social enterprise Better Assembly Services fell in the year resulting in an income reduction of 7.4%, from £148,586 in 2019/20 to £137,573 in 2020/21. The service’s temporary closure part way through March because of COVID-19 contributed to this drop in sales.

The average number of employees increased from 31.8 to 35.8 in the year because of the recruitment to the Youth Promise Plus contract. During the year 2020/21, the staff retention improved significantly. There were 19 resignations in 2019/2020 and 5 in 2020/2021. This improvement was achieved because of there being a much stronger leadership team in place, including for Human Resources and Learning and Development. A reward and recognition strategy was introduced and this had a positive impact.

Despite a challenging year, due to the pandemic, Better Pathways can report a surplus year end position of £32,680, having total funds of £590,177 to carry forward at the year ended 31 March 2021. Of these funds, £33,193 are restricted, £217,375 designated unrestricted funds and £339,609 general unrestricted funds. The designated funds largely relate to the tangible fixed asset fund so do not form part of our calculation of free reserves. This fund represents the net book value of fixed assets purchased through general funds. Depreciation is charged against this fund.

Fundraising and Donations

We appointed a professional fundraiser who started at Better Pathways in September 2019. For the year 2020/21 our fundraiser raised £98,999 (2019/20: £33,000) from grant giving trusts and foundations. We are grateful to the funders who have responded so positively to our bids for support and we are pleased to acknowledge them later in this report.

In addition to the funds raised from grant giving trusts and foundations, we received Covid Relief Funding from Birmingham City Council of £32,500. During the year, a benefactress donated £20,000 which has enabled us to design a web-based platform to host our Vulnerability Awareness Training.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

During the year we registered with the Fundraising Regulator and can confirm we have not received any complaints in the year. Currently, our fundraising activity is limited to the submission of bids to grant giving bodies. We do not raise funds from the general public, for example, through door-to-door canvassing, but were we ever to do so, we would ensure that we have policies and procedures in place to identify and protect people in situations of vulnerability.

Principal funding sources

In respect of our statutory sector contracts our sources of funding are:

We are grateful to the following organisations for their generous grants in 2020/21. Funds from these organisations have helped us to deliver our various activities for the benefit of our service users:

Principal risks and mitigations

The Charity’s principal risks are:

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Reserves policy and going concern

The trustees’ policy is to maintain 90 days’ expenditure in the general reserves to provide working capital and reserves for unforeseen reductions in cash flow. The general reserve on 31 March 2021 amounted to 136 days expenditure; last year this was standing at 51 days. The increase in the number of days is due to the decrease in direct costs and overheads because of the ending of the Mental Health, Recovery and Employment contract. Actions to continually improve our reserves balance are being addressed by the Board as set out elsewhere in this report.

In the year ended 31 March 2021, there was no expenditure from the Future Investment for Social Enterprises or Premises Improvement Funds. As a result of the pandemic the premises were underutilised and the social enterprises were operating on a reduced capacity.

The funds allocated to designated funds will be used solely for investment in charitable activities. Investment will improve the services on offer and support new investments in the future.

Our Plans

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Accreditations

Structure, governance and management

The organisation is a charitable company limited by guarantee, incorporated in England and Wales in September 1965 and registered as a Charity on 11 February 1963.

The company was established under a memorandum of association, which established the objects and powers of the charitable company and is governed under its articles of association.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

All trustees give their time voluntarily and receive no benefits from the Charity. Any expenses reclaimed from the Charity are set out in note 7 to the accounts.

Trustees are elected at the general meeting. Nominations for additional trustees may be made by Board members. All directors serve in an honorary capacity and are the trustees of the charity. There is a rotational process in place with three trustees retiring from the board each year; however, these trustees can offer themselves for re-election should they wish to do so. We try to ensure that Board members reflect appropriate diversity in terms of age, gender and ethnicity and possess the skills required to direct the organisation.

At no time during the year did any trustee have an interest in a contract entered into by the Association in relation to the activities of the Association other than their involvement as employees of Mental Health Trusts.

No remuneration or other benefits have been paid or are payable to any trustee of the Association either directly or indirectly from the funds of the Association.

The overall policy of the Association is set by the trustees at regular meetings of the Board. Day to day running of the Association is managed by the Chief Executive, Sue Roberts, and her support staff. Three sub-committees meet on a quarterly basis. Regular feedback is obtained from the Service User Forum made up of service users engaged in activities with the Association.

Appointment of trustees

We use the guidance for trustee recruitment published by the Charity Commission. Regular skills audits are completed, gaps are identified, and new Trustees appointed based on these gaps.

Trustee induction and training

The Trustee induction handbook covers training to be undertaken, visits to be made, meetings to be attended:

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Required reading includes:

Related parties and relationships with other organisations

No formal relationships exist between the Association and any related parties and there are no subsidiary undertakings.

The Association cooperates with other charities in the pursuit of its charitable objectives.

Remuneration policy for key management personnel

The Board has a remuneration committee comprising the Chair of the Board and the Chair of Finance, Audit & Risk Sub-Committee. The Chair conducts the annual appraisal of the Chief Executive and agrees her salary, which is benchmarked against comparable organisations in the not for profit sector. The salary is endorsed by the full Board.

Policy for employment of disabled persons

The Association has an Equality and Diversity policy which commits the Association to examine its selection and appointment process, personnel procedures and training provisions to ensure the elimination of direct or indirect discrimination and the provision of equality of opportunity for the protected characteristics contained with the Equality Act 2010.

There are regular reviews to maintain good employment practices and those engaged in the selection process will be made aware of the Equality and Diversity Policy, the Acts and their personal liability to law.

Employee information

The Association aims to provide employees with as much information as possible on matters of concern to them as employees. Responsibility for doing this rests with members of the Senior Leadership Team, coordinated through the Head of Human Resources.

Funds held as custodian trustee on behalf of others

No funds are held by the Association as custodian trustee on behalf of others.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

Statement of responsibilities of the trustees

The trustees (who are also directors of Birmingham Industrial Therapy Association Ltd for the purposes of company law) are responsible for preparing the trustees’ annual report including the strategic report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the trustees to prepare financial statements for each financial year, which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the trustees are required to:

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

In so far as, the trustees are aware:

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

Trustees are appointed at the AGM which is attended by the charity’s trustees. There is a current proposal to establish a membership body and if this is agreed, then in future trustees will be appointed by members. There were 11 trustees in the year 2020-2021 (2020:11).

The trustees’ annual report has been prepared in accordance with the provisions applicable to companies subject to the small companies’ regime.

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Birmingham Industrial Therapy Association Limited

Trustees’ annual report

For the year ended 31 March 2021

The trustees’ annual report has been approved by the trustees on 13 December 2021 and signed on their behalf by

Simon Lawrence Chair, Board of Trustees

Sue Roberts Chief Executive Officer

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Independent auditor’s report

To the members of

Birmingham Industrial Therapy Association Limited

Opinion

We have audited the financial statements of Birmingham Industrial Therapy Association Limited (the ‘charitable company’) for the year ended 31 March 2021 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the 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 Birmingham Industrial Therapy Association Limited'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.

17

Independent auditor’s report

To the members of

Birmingham Industrial Therapy Association Limited

Other Information

The other information comprises the information included in the trustees’ annual report other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 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.

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ annual report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the statement of trustees’ responsibilities set out in the trustees’ annual report, the trustees (who are also the directors of the charitable company for the purposes of

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Independent auditor’s report

To the members of

Birmingham Industrial Therapy Association Limited

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.

Auditor’s responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud are set out below.

Capability of the audit in detecting irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

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Independent auditor’s report

To the members of

Birmingham Industrial Therapy Association Limited

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

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

Fleur Holden (Senior statutory auditor) 16 December 2021

for and on behalf of Sayer Vincent LLP, Statutory Auditor Invicta House, 108-114 Golden Lane, LONDON, EC1Y 0TL

20

Birmingham Industrial Therapy Association Limited

Statement of financial activities (incorporating an income and expenditure account)

For the year ended 31 March 2021

Unrestricted
Restricted
Note
£
£
Income from:
3
36,485
20,000
4
2,016,083
49,985
4
197,371
-
4
108,559
29,014
4
95,036
-
60
-
2,453,594
98,999
5
2,141,276
49,985
5
199,908
34,837
5
93,908
-
2,435,091
84,822
18,503
14,177
20,000
(20,000)
20
38,503
(5,823)
Reconciliation of funds:
518,481
39,016
556,984
33,193
Transfers between funds
Total funds brought forward
Total funds carried forward
Net movement in funds
Core activities
Recovery and Employment
Total expenditure
Net income for the year
Charitable activities
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Recovery and Employment
Bank Interest
Total income
Expenditure on:
Donations and grants
Charitable activities		 Unrestricted
Restricted
Note
£
£
Income from:
3
36,485
20,000
4
2,016,083
49,985
4
197,371
-
4
108,559
29,014
4
95,036
-
60
-
2,453,594
98,999
5
2,141,276
49,985
5
199,908
34,837
5
93,908
-
2,435,091
84,822
18,503
14,177
20,000
(20,000)
20
38,503
(5,823)
Reconciliation of funds:
518,481
39,016
556,984
33,193
Transfers between funds
Total funds brought forward
Total funds carried forward
Net movement in funds
Core activities
Recovery and Employment
Total expenditure
Net income for the year
Charitable activities
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Recovery and Employment
Bank Interest
Total income
Expenditure on:
Donations and grants
Charitable activities		 £
56,485
2,066,068
197,371
137,573
95,036
60
2021
Total		 £
-
2,065,962
326,806
148,586
69,393
-
2020
Total
2,453,594
98,999		 2,552,593 2,610,747
2,141,276
49,985
199,908
34,837
93,908
-		 2,191,261
234,745
93,908		 2,129,479
276,431
102,484
2,435,091
84,822		 2,519,913 2,508,394
18,503
14,177
20,000
(20,000)		 32,680
-		 102,353
-
38,503
(5,823)
518,481
39,016		 32,680
557,497		 102,353
455,144
556,984
33,193		 590,177 557,497

All of the above results are derived from continuing activities, except where shown. There were no other recognised gains or losses other than those stated above. Movements in funds are disclosed in Note 20 to the financial statements.

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Birmingham Industrial Therapy Association Limited

Company no. 00748773

Balance sheet

As at 31 March 2021

As at 31 March 2021
Note
Fixed assets:
11
Current assets:
12
13
Liabilities:
14
16
20
Total unrestricted funds
Total assets less current liabilities
Stock
Debtors
Restricted income funds
Unrestricted income funds:
Designated funds
The funds of the charity:
Creditors: amounts falling due within one year
Net current assets
Total net assets
Creditors: amounts falling due after one year
Cash at bank and in hand
Short Term Deposit
Tangible assets
General funds
Total charity funds		 £
6,219
208,690
75,829
359,201		 2021
£
227,616		 £
4,730
156,022
75,769
309,383		 2020
£
241,935
227,616
412,561		 241,935
315,562
649,939
237,378		 545,904
230,342
217,375
339,609		 228,671
289,810
640,177 557,497
(50,000) -
590,177 557,497
33,193
556,984		 39,016
518,481
590,177 557,497

Approved by the trustees on 13 December 2021 and signed on their behalf by

Simon Lawrence Chair

22

Birmingham Industrial Therapy Association Limited

Statement of cash flows

For the year ended 31 March 2021

For the year ended 31 March 2021 For the year ended 31 March 2021
Note
£
£
22
73,078
60
(23,260)
(23,200)
50,000
99,878
385,152
22
485,030
Analysis of cash and cash equivalents and of net debt
At 1 April
2020
£
Cash at bank and in hand
309,383
Short term deposits
75,769
Total cash and cash equivalents
385,152
Loans falling due after more than one year
-
Total
385,152
Net cash used in investing activities
Net cash used in operating activities
Cash flows from investing activities:
Interest received
Purchase of fixed assets
Cash and cash equivalents at the beginning
Cash and cash equivalents at the end of the
Change in cash and cash equivalents in the
2021
Cash flows from financing activities:
Cash inflows from new borrowing		 £
£
(102,139)
160
(4,982)
(4,822)
-
(106,961)
492,113
385,152
Cash flows
At 31 March
2021
£
£
49,818
359,201
60
75,829
49,878
435,030
50,000
50,000
99,878
485,030
2020
Cash flows
£
49,818
60
50,000 -
99,878
385,152		 (106,961)
492,113
485,030 385,152
At 1 April
2020
£
309,383
75,769		 At 31 March
2021
£
359,201
75,829
385,152 49,878 435,030
- 50,000 50,000
385,152 99,878 485,030

23

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Birmingham Industrial Therapy Association Limited is a charitable company limited by guarantee and is incorporated in the United Kingdom. The registered office address and principal place of business is 201-206 Alcester Street, Digbeth, Birmingham, B12 0NQ.

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) - (Charities SORP FRS 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy or note.

In applying the financial reporting framework, the trustees have made a number of subjective judgements, for example in respect of significant accounting estimates. 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. The nature of the estimation means the actual outcomes could differ from those estimates. Any significant estimates and judgements affecting these financial statements are detailed within the relevant accounting policy below.

The charitable company meets the definition of a public benefit entity under FRS 102.

d) Going concern

The trustees consider that there are no material uncertainties about the charitable company's ability to continue as a going concern as explained in the trustees' annual report.

The trustees do not consider that there are any sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next reporting period.

Income from government and other grants, whether ‘capital’ grants or ‘revenue’ grants, is recognised when the charity has entitlement to the funds, any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably and is not deferred.

Income received in advance of the provision of a specified service is deferred until the criteria for income recognition are met.

f) Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the charity; this is normally upon notification of the interest paid or payable by the bank.

g) Fund accounting

Unrestricted funds are donations and other incoming resources received or generated for the charitable purposes.

Designated funds are unrestricted funds earmarked by the trustees for particular purposes.

h) Expenditure and irrecoverable VAT

Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Expenditure is classified under the following activity headings:

Irrecoverable VAT is charged as a cost against the activity for which the expenditure was incurred.

24

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Resources expended are allocated to the particular activity where the cost relates directly to that activity. However, the cost of overall direction and administration of each activity, comprising the salary and overhead costs of the central function, is apportioned on the following basis which are an estimate, based on staff time, of the amount attributable to each activity.

Where information about the aims, objectives and projects of the charity is provided to potential beneficiaries, the costs associated with this publicity are allocated to charitable expenditure.

Where such information about the aims, objectives and projects of the charity is also provided to potential donors, activity costs are apportioned between fundraising and charitable activities on the basis of staff time by each activity.

Rental charges are charged on a straight line basis over the term of the lease.

Items of equipment are capitalised where the purchase price exceeds £250. Depreciation costs are allocated to activities on the basis of the use of the related assets in those activities. Assets are reviewed for impairment if circumstances indicate their carrying value may exceed their net realisable value and value in use.

Where fixed assets have been revalued, any excess between the revalued amount and the historic cost of the asset will be shown as a revaluation reserve in the balance sheet.

Depreciation is provided at rates calculated to write down the cost of each asset to its estimated residual value over its expected useful life. The depreciation rates in use are as follows:

Stocks are stated at the lower of cost and net realisable value. In general, cost is determined on a first in first out basis and includes transport and handling costs. Net realisable value is the price at which stocks can be sold in the normal course of business after allowing for the costs of realisation. Provision is made where necessary for obsolete, slow moving and defective stocks. Donated items of stock, held for distribution or resale, are recognised at fair value which is the amount the charity would have been willing to pay for the items on the open market.

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

Short term deposits includes cash balances that are invested in accounts with a maturity date of between 3 and 12 months.

Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

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

q) Financial Instruments

The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.

r) Pensions

The charity has a NEST pension scheme to offer all employees. The charity is contributing a minimum employer contribution percentage into the scheme set by the Pension Regulator.

25

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Unrestricted
£
Donations
-
Covid Relief Funding
32,500
Coronavirus Job Retention Scheme income
3,985
36,485
Recovery and Employment
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Core activities
Recovery and Employment
Social Enterprise - Express Signs
Social Enterprise - Production Assembly Services
Net income for the year
Income from:
Donations
Total expenditure
Charitable activities:
Total income
Expenditure on:
Charitable activities:
Income from donations		 Unrestricted
£
Donations
-
Covid Relief Funding
32,500
Coronavirus Job Retention Scheme income
3,985
36,485
Recovery and Employment
Social Enterprise - Production Assembly Services
Social Enterprise - Express Signs
Core activities
Recovery and Employment
Social Enterprise - Express Signs
Social Enterprise - Production Assembly Services
Net income for the year
Income from:
Donations
Total expenditure
Charitable activities:
Total income
Expenditure on:
Charitable activities:
Income from donations		 Restricted
£
20,000
-
-		 2021
Total
£
20,000
32,500
3,985		 £
-
2,052,962
326,806
128,586
69,393
Unrestricted
activities		 Restricted
continuing
activities
£
-
13,000
-
20,000
-		 £
-
2,065,962
326,806
148,586
69,393
2020
Total
2,577,747 33,000 2,610,747
2,129,479
233,749
102,484		 -
42,682
-		 2,129,479
276,431
102,484
2,465,712 42,682 2,508,394
112,035 (9,682) 102,353
Unrestricted
£
-
-
-		 Restricted
£
-
-
-		 2020
Total
£
-
-
-
36,485 20,000 56,485 - - -

26

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Total for Social Enterprise - Better Assembly Services
Prospects - Thrive into Work
Birmingham Solihull Mental Health Trust
Birmingham City Cross CCG Funding
Other
Total for Core Activities
Birmingham City Council- Neurodiverse
Grant funding for core activities
Birmingham Solihull Mental Health Trust
Earned Income
Total for Social Enterprise - Express Signs
Total income from charitable activities
Birmingham City Council - Youth Promise Plus
Mental Health First Aid Training
Total for Recovery and Employment
Birmingham and Sandwell Councils
Earned Income		 £
2,012,394
-
3,689
Unrestricted
continuing
activities		 Restricted
continuing
activities
£
-
49,985
-		 2021
Total
£
2,012,394
49,985
3,689		 2020
Total
£
2,023,539
13,000
29,423
2,016,083
-
-
91,275
106,096
-		 49,985
-
-
-
-
-		 2,066,068
-
-
91,275
106,096
-		 2,065,962
55,000
145,238
80,894
-
45,674
197,371
6,722
101,837		 -
-
29,014		 197,371
6,722
130,851		 326,806
7,651
140,935
108,559
81,313
13,723		 29,014
-
-		 137,573
81,313
13,723		 148,586
53,000
16,393
95,036 - 95,036 69,393
2,417,049 78,999 2,496,048 2,610,747

27

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Total for Social Enterprise- Express Signs
Total income from charitable activities
Birmingham City Council - IAG, Employability
Total for Learning and Work
Earned Income
Total for Social Enterprise-Park Lane Garden Centre
Birmingham and Sandwell Councils
Grant funding for core activities
Other
Total for Core Activities
Birmingham City Council- Neurodiverse
Prospects - Thrive into Work
Birmingham Solihull Mental Health Trust
Mental Health First Aid Training
Building Better Opportunities
Birmingham City Council -Youth Promise Plus
Earned Income
Birmingham City Cross CCG Funding
Earned Income
Total for Social Enterprise- Production Assembly Services
Earned Income
Birmingham City University
Total for Social Enterprise- Textiles' By St. Anne's
Birmingham Solihull Mental Health Trust		 Unrestricted
continuing
activities
2,023,539
-
29,423		 Restricted
continuing
activities
£
-
13,000
-		 2020
Total
£
2,023,539
13,000
29,423		 2019
Total
£
1,733,700
57,277
9,031
2,052,962
55,000
145,238
80,894
45,674
-
-
-		 13,000
-
-
-
-
-
-
-		 2,065,962
55,000
145,238
80,894
45,674
-
-
-		 1,800,008
110,000
124,402
15,407
40,466
16,485
108,482
6,221
326,806
-		 -
-		 326,806
-		 421,463
14,399
-
7,651
120,935		 -
-
20,000		 -
7,651
140,935		 14,399
-
179,636
128,586
-
-		 20,000
-
-		 148,586
-
-		 179,636
26,971
4,665
-
53,000
16,393		 -
-
-		 -
53,000
16,393		 31,636
53,000
21,821
69,393 - 69,393 74,821
2,577,747 33,000 2,610,747 2,521,963

28

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Charitable activities

Staff costs (Note 7)
Delivery by other partners
Material
Recruitment and Training
Client and Participant Expenses
Staff Travel and Motor Expenses
Marketing, Print and Stationery
ICT and Communication
Consultancy and Professional Fees
Utilities
Premises Cost and Insurance
Sundry Expenses
Audit Fee
Bank Charges
Non Recoverable VAT
Depreciation
Support costs
Governance costs
Total expenditure 2021
Total expenditure 2020		 Recovery
and
Employment
£
669,416
1,171,590
-
8,440
6,219
1,303
3,454
66,273
32,572
12,351
26,966
6,626
-
267
15,790
11,197

Social
Enterprise -
Production
Assembly
Services
£
91,933
-
22
150
16,059
8,848
752
6,951
370
3,250
9,736
1,744
-
47
1,122
6,149



Social
Enterprise -
Express
Signs
£
43,000
-
3,370
-
707
-
251
3,931
-
-
15,025
-
-
23
222
-		 Governance
costs
£
-
-
-
-
-
-
-
-
-
-
-
-
8,210
-
-
-		 Support
costs
£
199,631
-
-
3,593
-
-
765
15,170
12,081
3,304
6,714
1,773
-
71
2,241
20,234
2021
Total
£
1,003,980
1,171,590
3,392
12,183
22,985
10,152
5,222
92,325
45,023
18,905
58,441
10,143
8,210
408
19,375
37,579		 2020
Total
£
960,181
1,167,004
7,795
9,281
42,823
17,975
8,877
83,805
30,890
21,065
79,758
13,772
8,050
1,052
19,690
36,376
2,032,464
154,035
4,762		 147,133
84,985
2,627		 66,529
26,558
821		 8,210
-
(8,210)		 265,577
(265,577)
-		 2,519,913
-
-		 2,508,394
-
-
2,191,261 234,745 93,908 - - 2,519,913 2,508,394
2,129,479 276,431 102,484 - -

29

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

5b Analysis of expenditure (prior year)

Charitable activities

Staff costs (Note 7)
Delivery by other partners
Material
Recruitment and Training
Clients and Participant Expenses
Staff Travel and Motor Expenses
Marketing, Print and Stationery
ICT and Communication
Consultancy and Professional Fees
Utilities
Premises Cost and Insurance
Sundry Expenses
Audit fee
Bank charges
Non Recoverable VAT
Depreciation
Support costs
Governance costs
Total expenditure 2020		 Recovery
and
Employment
£
620,821
1,167,004
4,669
5,487
1,560
7,541
5,278
59,115
1,243
11,682
23,458
5,633
-
697
19,690
4,874

Social
Enterprise -
Production
Assembly
Services
£
75,939
-
21
375
39,143
8,764
1,559
7,889
7,500
2,480
16,078
875
-
127
-
7,950



Social
Enterprise -
Express
Signs
£
43,000
-
3,105
-
1,945
-
243
4,179
-
-
16,242
50
-
57
-
-		 Governance
costs
£
-
-
-
-
-
-
-
-
-
-
-
-
8,050
-
-
-		 Support
costs
£
220,421
-
-
3,419
175
1,670
1,797
12,622
22,147
6,903
23,980
7,214
-
171
-
23,552		 2020
Total
£
960,181
1,167,004
7,795
9,281
42,823
17,975
8,877
83,805
30,890
21,065
79,758
13,772
8,050
1,052
19,690
36,376
1,938,752
187,961
4,669		 168,700
103,703
2,576		 68,821
32,407
805		 8,050
-
(8,050)		 324,071
(324,071)
-		 2,508,394
-
-
2,131,382 274,979 102,033 - - 2,508,394

30

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

This is stated after charging:

This is stated after charging:
2021
£
37,579
-
14,347
8,210
2021
£
870,588
-
73,390
43,000
17,003
1,003,980
Other Staff Costs
Employer’s contribution to defined contribution pension schemes
Audit
Analysis of staff costs, trustee remuneration and expenses, and the cost of key management personnel
Salaries and wages
Social security costs
Redundancy and termination costs
Staff costs were as follows:
Other
Property
Operating lease rentals:
Auditors' remuneration (excluding VAT):
Depreciation		 2021
£
37,579
-
14,347
8,210		 2020
£
36,376
14,896
25,472
8,050
2020
£
807,937
20,487
71,969
43,000
16,789
1,003,980 960,182

7 Analysis of staff costs, trustee remuneration and expenses, and the cost of key management personnel

In 2021 no employees were made redundant (2020: £13,088).

The following number of employees received employee benefits (excluding employer pension costs and employer's national insurance) during the year between:

£70,000 - £79,999

2021 2020
No. No.
1 1

The total employee benefits (including employer's pension contributions and employer's national insurance) of the key management personnel were £79,761 (2020: £79,785).

The charity trustees were not paid or received any other benefits from employment with the charity in the year (2020: £nil). No charity trustee received payment for professional or other services supplied to the charity (2020: £nil).

No trustees' expenses were paid in 2021 and 2020.

8 Staff numbers

The average number of employees (head count based on number of staff employed) during the year was as follows:

Recovery & Employment
Social Enterprise- Production Assembly Services
Training
Support		 2021
No.
25.8
-
4.0
6.1		 2020
No.
20.8
1.3
3.7
6.0
35.9 31.8

9 Related party transactions

Aggregated donations from related parties were £nil (2020: £nil).

There are no donations from related parties which are outside the normal course of business and no restricted donations from related parties.

Martin Commander, Vice Chair Board of Trustees is a paid consultant to Birmingham Solihull Mental Health Trust (BSMHFT). During the year the charity receieved income of £172,588 (2020: £80,894) from BSMHFT which was provided on an arms length basis.

31

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

10 Taxation

The charitable company is exempt from corporation tax as all its income is charitable and is applied for charitable purposes.

11 Tangible fixed assets

Tangible fixed assets
Cost
Depreciation
At the start of the year
Additions in year
At the end of the year
At the end of the year
At the start of the year
At the end of the year
At the start of the year
Charge for the year
Net book value		 Freehold
property
£
312,910
-		 Plant, fixtures
and fittings
£
304,270
1,060
Computer
equipment
£
174,468
22,200		 Total
£
791,648
23,260
312,910 305,330 196,668 814,908
154,166
6,492		 252,231
11,625		 143,315
19,462		 549,713
37,579
160,658 263,856 162,777 587,292
152,252 41,474 33,890 227,616
158,744 52,039 31,153 241,935

Land with a value of £36,625 (2020: £36,625) is included within freehold property and not depreciated.

All of the above assets are used for charitable purposes.

12 Stock

12
Stock
13
14
Trade debtors
Prepayments
Finished goods
Debtors
Trade creditors
Taxation and social security
Accrued income
Accruals
Creditors: amounts falling due within one year
Deferred income (note 15)		 2021
£
6,219		 2020
£
4,730
6,219 4,730
2021
£
83,320
31,684
93,686		 2020
£
123,202
32,820
-
208,690 156,022
2021
£
164,921
40,489
15,439
16,529		 2020
£
158,793
25,284
24,436
21,829
237,378 230,342

32

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Deferred income comprises participant costs received in advance.

Deferred income comprises participant costs received in advance.
Balance at the beginning of the year
Amount released to income in the year
Amount deferred in the year
Balance at the end of the year
Bank loans
Creditors: amounts falling due after one year		 2021
£
21,829
(5,300)
-		 2020
£
60,400
(47,846)
9,275
16,529 21,829
2021
£
50,000		 2020
£
-
50,000 -

Bounce Bank Loan totalling £50,000 (2020: £nil) unsecured. The terms of the loan are 72 months with an interest rate of 2.5%. No payment is required for the first 12 months and monthly loan repayments will commence 13 months after the loan was approved. Repayment of the loan will commence April 2022.

17 Pension Scheme

The charity offers an auto-enrolment into the NEST pension scheme. At the end of the year the liability of the NEST pension scheme was £4,151 (2020: £nil).

Past and present employees are covered by the provisions of the two NHS Pension Schemes. Details of the benefits payable and rules of the Schemes can be found on the NHS Pensions website at www.nhsbsa.nhs.uk/pensions. Both are unfunded defined benefit schemes that cover NHS employers, GP practices and other bodies, allowed under the direction of the Secretary of State in England and Wales. They are not designed to be run in a way that would enable NHS bodies to identify their share of the underlying scheme assets and liabilities. Therefore, each scheme is accounted for as if it were a defined contribution scheme: the cost to the NHS body of participating in each scheme is taken as equal to the contributions payable to that scheme for the accounting period.

In order that the defined benefit obligations recognised in the financial statements do not differ materially from those that would be determined at the reporting date by a formal actuarial valuation, the FReM requires that “the period between formal valuations shall be four years, with approximate assessments in intervening years”. An outline of these follows:

a) Accounting valuation

A valuation of scheme liability is carried out annually by the scheme actuary (currently the Government Actuary’s Department) as at the end of the reporting period. This utilises an actuarial assessment for the previous accounting period in conjunction with updated membership and financial data for the current reporting period, and is accepted as providing suitably robust figures for financial reporting purposes. The valuation of the scheme liability as at 31 March 2021, is based on valuation data as 31 March 2020, updated to 31 March 2021 with summary global member and accounting data. In undertaking this actuarial assessment, the methodology prescribed in IAS 19, relevant FReM interpretations, and the discount rate prescribed by HM Treasury have also been used.

The latest assessment of the liabilities of the scheme is contained in the report of the scheme actuary, which forms part of the annual NHS Pension Scheme Accounts. These accounts can be viewed on the NHS Pensions website and are published annually. Copies can also be obtained from The Stationery Office.

b) Full actuarial (funding) valuation

The purpose of this valuation is to assess the level of liability in respect of the benefits due under the schemes (taking into account recent demographic experience), and to recommend contribution rates payable by employees and employers.

The latest actuarial valuation undertaken for the NHS Pension Scheme was completed as at 31 March 2016. The results of this valuation set the employer contribution rate payable from April 2019 to 20.6% of pensionable pay. The 2016 funding valuation was also expected to test the cost of the Scheme relative to the employer cost cap that was set following the 2012 valuation. In January 2019, the Government announced a pause to the cost control element of the 2016 valuations, due to the uncertainty around member benefits caused by the discrimination ruling relating to the McCloud case.

The Government subsequently announced in July 2020 that the pause had been lifted, and so the cost control element of the 2016 valuations could be completed. The Government has set out that the costs of remedy of the discrimination will be included in this process. HMT valuation directions will set out the technical detail of how the costs of remedy will be included in the valuation process. The Government has also confirmed that the Government Actuary is reviewing the cost control mechanism (as was originally announced in 2018). The review will assess whether the cost control mechanism is working in line with original government objectives and reported to Government in April 2021. The findings of this review will not impact the 2016 valuations, with the aim for any changes to the cost cap mechanism to be made in time for the completion of the 2020 actuarial valuations.

33

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

18 Financial instruments

Financial liabilities measured at transaction value Bank loans

2021 2020
£ £
50,000 -

19a Analysis of net assets between funds (current year)

Analysis of net assets between funds (current year)
National Lottery Community Fund
MIND Charity
GJW Turner Trust
Living Well Grants
Severn Trent Water
Bailey Thomas Charitable Trust
Other Small Restricted Grants
Total restricted funds
Total designated funds
General funds
Unrestricted funds:
Total funds at 31 March 2021
Total unrestricted funds
Designated funds:
Premises Improvement Fund
Restricted funds:
Freehold Property
Net assets at 31 March 2020
Tangible fixed assets
Net current assets
The Rowlands Trust
Tangible Fixed Assets Funds
Jackie Noughton
Movements in funds (current year)
ERDF Catalysts Enterprises Grant
Analysis of net assets between funds (prior year)
Net assets at 31 March 2021
Long term liabilities
Julia and Hans Rausing Trust
The Edward Gostling Foundation
Souter Charitable Trust
The David Solomons Charitable Trust
CAF Resilience Fund
Western Power Community Foundation
Tangible fixed assets
Net current assets
Future Investment for Social Enterprises		 At 1 April
2020
£
25,520
7,744
2,400
-
1,000
-
-
-
-
-
-
-
-
-
-
-
2,352		 General
unrestricted
£
-
389,609
(50,000)		 £
197,375
20,000
-
Designated		 Restricted
£
30,241
2,952
-		 Total funds
£
227,616
412,561
(50,000)
339,609 217,375 33,193 590,177
£
-
289,810
General
unrestricted		 £
208,671
20,000
Designated		 Restricted
£
33,264
5,752		 £
241,935
315,562
Total funds
289,810 228,671 39,016 557,497
Income
£
-
-
-
1,000
-
17,932
2,000
2,500
2,000
4,000
23,553
5,000
1,000
17,014
2,000
20,000
1,000		 Expenditure
£
(1,267)
(1,756)
(300)
(1,000)
(1,000)
(17,932)
(2,000)
(2,500)
(2,000)
(4,000)
(23,553)
(5,000)
(1,000)
(17,014)
(2,000)
-
(2,500)		 Transfers
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(20,000)
-		 At 31 March
2021
£
24,253
5,988
2,100
-
-
-
-
-
-
-
-
-
-
-
-
-
852
39,016 98,999 (84,822) (20,000) 33,193
208,671
10,000
10,000		 -
-
-		 (34,556)
-
-		 23,260
-
-		 197,375
10,000
10,000
228,671 - (34,556) 23,260 217,375
289,810 2,453,594 (2,400,535) (3,260) 339,609
518,481 2,453,594 (2,435,091) 20,000 556,984
557,497 2,552,593 (2,519,913) - 590,177

19b Analysis of net assets between funds (prior year)

20a Movements in funds (current year)

34

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

20b Movements in funds (prior year)

National Lottery Community Fund
The Roger & Douglas Turner Charitable Trust
The Grimmett Trust
Birmingham District Nursing Charitable Trust
The Eveson Charitable Trust
Donald Forrester Trust
Other Small Restricted Grants
Total restricted funds
Total designated funds
General funds
Designated funds:
Tangible Fixed Assets Funds
Future Investment for Social Enterprises
Premises Improvement Fund
Total funds at 31 March 2020
Freehold Property
The Rowlands Trust
Big Lottery Fund-Garden Pathways
Wesleyan Foundation
Restricted funds:
ERDF Catalysts Enterprises Grant
Unrestricted funds:
Total unrestricted funds		 At 1 April
2019
£
26,787
9,500
2,700
8,000
559
-
-
-
-
-
-
1,152		 Income
£
-
-
-
-
-
10,000
3,000
2,000
3,000
7,000
5,000
3,000		 Expenditure
£
(1,267)
(1,756)
(300)
(8,000)
(559)
(9,000)
(3,000)
(2,000)
(3,000)
(7,000)
(5,000)
(1,800)		 Transfers
£
-
-
-
-
-
-
-
-
-
-
-
-		 At 31 March
2020
£
25,520
7,744
2,400
-
-
1,000
-
-
-
-
-
2,352
48,698 33,000 (42,682) - 39,016
138,539
10,000
10,000		 -
-
-		 (33,353)
-
-		 103,485
-
-		 208,671
10,000
10,000
158,539 - (33,353) 103,485 228,671
247,907 2,577,747 (2,432,359) (103,485) 289,810
406,446 2,577,747 (2,465,712) - 518,481
455,144 2,610,747 (2,508,394) - 557,497

35

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

21 Purposes of restricted funds

Freehold Property: Funding received from The Big Lottery Fund for improvement to the reception area of the Digbeth premises. Depreciation will be charged to this fund.

ERDF Catalyst Enterprise Grant: This grant was matched funded and assisted us to fund capital items and some salary for Production Assembly Services social enterprise.

Big Lottery Funds: This funding was provided to buy tools for Garden Services project.

The Rowlands Trust: The funds were donated to fund a new heating system for Better Assembly Services.

Wesleyan Foundation: The funds were donated to support volunteer/peer mentor recruitment and training.

National Lottery Community Fund: The funds were donated to allow Architect's feasibility study for the redevelopment of the Digbeth site.

The Roger & Douglas Turner Charitable Trust: Development of a Wellbeing Centre for service users, to incorporate the existing Better Assembly Services unit, and supplement this with the development of a suite of new wellbeing activities.

The Grimmett Trust: Development of a Wellbeing Centre for service users, to incorporate the existing Better Assembly Services unit, and supplement this with the development of a suite of new wellbeing activities.

Birmingham District Nursing Charitable Trust: Development of a Wellbeing Centre for service users, to incorporate the existing Better Assembly Services unit, and supplement this with the development of a suite of new wellbeing activities.

The Eveson Charitable Trust: Development of a Wellbeing Centre for service users, to incorporate the existing Better Assembly Services unit, and supplement this with the development of a suite of new wellbeing activities.

Donald Forrester Trust: The funds were recevied to support the core costs of the charity.

Small Restricted Grants: These small grants were given to support travel for our service users and their day to day activities.

Purpose of designated Funds

Tangible Fixed Assets fund: This fund represents the net book value of fixed assets purchased through general funds. Depreciation will be charged against this fund. In 2020, the transfer to this designated fund of £103,485 brought the closing balance in line with the current year net book value excluding any restricted capital funds.

Future Investment for Enterprises: The trustees have agreed not to utilise the funds this financial year.

Premises Improvement Fund: The purpose of this designated fund is to make improvement to the premises in Digbeth. The trustees have agreed not to utilise the funds this financial year.

The funds allocated to designated funds will be used solely for investment in charitable activities. Investment will improve the services on offer and support new investments in the future.

36

Birmingham Industrial Therapy Association Limited

Notes to the financial statements

For the year ended 31 March 2021

Reconciliation of net income / (expenditure) to net cash flow from operating activities
Net income / (expenditure) for the reporting period
(as per the statement of financial activities)
Depreciation charges
Bank interest
Increase in stocks
Increase in debtors
Increase in creditors
Net cash provided by / (used in) operating activities
Increase in new borrowings		 2021
£
32,680
37,579
(60)
(1,489)
(52,668)
7,036
50,000		 2020
£
102,353
36,376
(160)
(967)
(54,470)
(185,271)
-
73,078 (102,139)

23 Operating lease commitments

The charity's total future minimum lease payments under non-cancellable operating leases is as follows for each of the following periods:

Less than one year
One to five years		 2021
2020
£
£
14,347
26,206
9,935
20,991
24,281
47,197
Equipment		 2021
2020
£
£
14,347
26,206
9,935
20,991
24,281
47,197
Equipment
24,281 47,197

24 Legal status of the charity

The charity is a company limited by guarantee and has no share capital. The liability of each member in the event of winding up is limited to £1.

37