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2020-09-30-accounts

Company number: 1749730 Charity number: 287894

Association for Cultural Advancement Through Visual Art

Report and financial statements For the year ended 30 September 2020

Association for Cultural Advancement Through Visual Art

Contents

For the year ended 30 September 2020

Reference and administrative information .................................................................................... 1 Trustees’ annual report ................................................................................................................ 2 Independent auditor’s report ...................................................................................................... 18 Statement of financial activities (incorporating an income and expenditure account) .................. 22 Balance sheet ............................................................................................................................. 23 Statement of cash flows .............................................................................................................. 24 Notes to the financial statements ............................................................................................... 25

Association for Cultural Advancement Through Visual Art

Reference and administrative information

For the year ended 30 September 2020

Company number 1749730 – incorporated in the United Kingdom Charity number 287894 – registered in England & Wales Registered office and 54 Blechynden Street operational address London W10 6RJ

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:

Paul Augarde Appointed 27 November 2019
Alice Boff Appointed 10 March 2021
Nikhil Gupta Appointed 14 March 2019
Colin Prescod Resigned 3 December 2019
Caroline Jenkinson Resigned 6 March 2020
Michelle Kershaw Appointed 15 August 2019
Karen Lee Resigned 6 March 2020
Rebekah Paczek Appointed 11 March 2020
Gavin Turk Resigned 6 March 2020
Caspar Van Eijck Appointed 27 November 2019
Key management Tom Holley Chief Executive
personnel
Bankers National Westminster Bank
1stFloor
180 Brompton Road
London
SW3 1HL
Solicitors Russell Cooke LLP
2 Putney Hill
London
SW15 6AB
Auditor Sayer Vincent LLP
Chartered Accountants and Statutory Auditor
Invicta House
108-114 Golden Lane
LONDON
EC1Y 0TL

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

The trustees present their report and the audited financial statements for the period ended 30 September 2020. Whilst the audited financial statements run to 30 September 2020, this annual report includes commentary on activities since then, particularly in light of the arrival of COVID19.

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

Objectives and activities

Purposes and aims

The trustees review the aims, objectives and activities of the charity each year. This report looks at what the charity has achieved and the outcomes of its work in the reporting period. The trustees report the success of each key activity and the benefits the charity has brought to those groups of people that it is set up to help. The review also helps the trustees ensure the charity's aims, objectives and activities remained focused on its stated purposes.

The trustees have referred to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the charity's aims and objectives and in planning its future activities. In particular, the trustees consider how planned activities will contribute to the aims and objectives that have been set.

An important part of the national arts and cultural infrastructure, ACAVA operates an ecosystem of affordable workspaces, facilities, professional development programmes, exhibitions and public art programmes focused on community collaboration.

ACAVA continued to provide studios and facilities that support the production of the visual arts, and other creative practices, maintaining over 400 studios and workspaces in twenty buildings.

The charity operates in diverse socioeconomic contexts: nine London boroughs; three locations in Essex; and a large heritage regeneration site in Stoke-on-Trent. Studios are located in several areas of low engagement in the arts and culture, for example: LB Tower Hamlets, LB Newham, LB Brent, LB Harrow, North Kensington (RBKC), LB Merton, LB Hammersmith and Fulham, LB Wandsworth, Deptford, Hadleigh (Essex), Harlow (Essex), Ardleigh (Essex) and Stoke-on-Trent.

For over 30 years, ACAVA has been a pioneer of arts in health and wellbeing settings. Fostering creativity and wellbeing remains a central concern of our programmes today. This involves working collaboratively with professional art therapists, local authorities, the NHS, clinical commissioning groups, community groups, individuals, voluntary groups and professional artists who are often ACAVA studio holders.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

ACAVA delivers sustainable life-long learning and participation opportunities for people to benefit from high quality arts interventions that are participant led or co-created with professional artists.

Public exhibition and workshop facilities

The charity maintains exhibition and workshop facilities at seven of its studio buildings. They serve as exhibition and event platforms for ACAVA artists, our community partners, and others to present arts and cultural programmes that engage the public. These spaces are important shared contexts that enable interaction, knowledge exchange and dialogue between professional artists, local communities, the public and our strategic partners/stakeholders.

Facilities are regularly accessed by diverse local communities across the portfolio where they stage self-initiated independent activities that include curated exhibitions, presentations, workshops, family activities, meetings, art classes, exercise classes, film screenings and more.

Accessible community asset facilities are located at seven sites:

Workspace occupancy and COVID-19

Despite the pandemic that escalated rapidly in March 2020 occupancy for the year, and into 2021, has remained high with modest variances caused by three national lockdowns. The pandemic caused a sudden and widespread loss of income to the arts sector and especially for freelance workers and sole traders who constitute the majority of ACAVA studio holders. The potential financial consequences if studio holders were unable to maintain their studios posed an existential threat. To mitigate the risk, we increased resources given to communications and marketing and streamlined studio allocations processes. The establishment of the ACAVA Artists Hardship Fund in May 2020 has proved significant along with several successful fundraising applications that have stabilised finances, addressed some losses and enabled restructuring.

Achievements and performance

The charity's main activities and who it tries to help are described below. All its charitable activities focus on promoting arts education and are undertaken to further the Association for Cultural Advancement Through Visual Art’s charitable purposes for the public benefit.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

Strategic partnerships and collaborations

The charity has established, and continues to nurture, mutually beneficial relationships with external stakeholders and agencies who fund, commission or collaborate with our public programme activities.

Partners include: NHS West London Clinical Commissioning Group (WLCCG); Grenfell Recovery Fund (Young People); City Living Local Life; Al-Manaar The Muslim Cultural Heritage Centre; Kensington and Chelsea Foundation; NHS Central and North West London Mental Health Trust Grenfell Recovery Service; Kensington Aldridge Academy; Royal Borough of Kensington and Chelsea; NHS Central and North West London Mental Health Trust Grenfell Recovery Service; Action Disability Kensington and Chelsea; The Stables Traveller Site; Kensington and Chelsea Social Council; London Borough of Hammersmith and Fulham; London Borough of Merton; London Borough of Brent; London Borough of Ealing; Harrow Council; Essex County Council; Harlow Council; Hadleigh Council; Castle Point Borough Council; Castle Point Regeneration Partnership; Stoke-on-Trent City Council; Action Space; Greater London Authority; Arts Council England; Open Arts – of NHS South Essex Partnership Trust; Golborne and Maxilla Nursery School; St Francis of Assisi RC Primary; Kids on the Green; Bramley House Tenants and Residents Association; Trees for Grenfell; Just Solutions 123; Baraka Supplementary School, EPCA Supplementary School; Silchester Estate Tenants and Residents Association; Maxilla Social Club; Midaye; Grenfell Tower site team; Humanity for Grenfell; Hestia; Volunteer Centre Kensington and Chelsea; Venture Centre; Avondale Park Primary; Barlby Primary; Bevington Primary; Colville Primary; Grenfell United; Lancaster West Estate Tenant and Resident Association; Oxford Gardens Primary; St Charles RC Primary; St Clements and St James Primary; St Thomas' CE Primary; St. Mary's RC Primary; Thomas Jones Primary; BCB; Staffordshire University; Stoke-on-Trent Chamber of Commerce; Pat and Fred Phillips; High Street Heritage Action Zone (Stoke-on-Trent); Community Cinema (Hadleigh).

Public Programmes Summary

Programmes are delivered across a range of different geographical, socio-economic and cultural contexts in London, Essex and Stoke-on-Trent.

Participation

ACAVA delivered 380 public events across its portfolio with 2,500 people attending.

North Kensington, London

The charity’s socially inclusive programmes in North Kensington are co-designed, curated and produced by staff based at our Blechynden Street Studios and community workshop headquarters and our studios, gallery and workshop at Maxilla Walk in North Kensington.

The lasting impact of these programmes is testament to successful ACAVA, NHS, clinical commissioning group, local authority, and community collaborations spanning generations.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

Since the Grenfell Tower fire of June 2017, ACAVA has been the lead arts organisation delivering Grenfell recovery creative programmes that enable local communities to memorialise and recover. In communities suffering displacement and trauma ACAVA has been commended for delivering inclusive programmes including but not limited to the following core activities.

Flourish

A safe space for intergenerational groups/families who have been impacted by the Grenfell Tower fire. Flourish delivers school holiday art programmes led by professional artists and storytellers whose experience includes artist in residence at the Large Hadron Collider, CERN and commissions from EurOcean and the Welcome Collection. They deliver creative experiences that encourage families to explore art in a contemporary context.

We delivered a face to face programme each school holiday. ACAVA at Home translated learning materials for online delivery achieved under challenging circumstances during the first lockdown. The initiative enabled participating families to engage remotely with planned programmes. We produced artist-designed worksheets, storytelling sessions, 'How to' videos and a series of animated gifs focused on mindfulness and mental wellbeing.

Flourish in the Forest

During May 2020 half term a pilot Flourish in the Forest offered families living in overcrowded accommodation with no access to outside space the chance to play and be creative in the Maxilla Forest School Garden. It was a successful and we subsequently secured funding for more support to in-need families over the summer months.

Grenfell Memorial Community Mosaic

This acclaimed community-designed public memorial is delivered in partnership with Al-Manaar Muslim Cultural Heritage Centre. The mosaic is a collective project initiated in April 2018 – an evolving and growing wall-mounted installation situated close to the base of Grenfell Tower. Each month a different community, faith group or school collaborate with artists to craft a new section which is added to the artwork.

Art Therapy for Adults

In response to the Grenfell Tower fire ACAVA worked with a team of state registered art psychotherapists to provide group and individual art therapy sessions for adults affected by the fire.

Art for Wellbeing Everyday (June 2018 – Dec 2019)

A project with local people, professional artists Fand a graphic designer to co-create a series of 'How to' guides. Eight guides were created explaining mosaic, ink drawing, painting from sculpture, paper sculpture, experimental casting, lino printing, comic book making and basket weaving.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

Creativity Clinic

A support programme developed from the Art for Wellbeing Everyday programme that provides a supportive social and creative space every month for AWE alumni to continue to develop their creative practice.

Maxilla Men's Shed

Connected with the international Men’s Shed movement, Maxilla Men's Shed is a fully-equipped workshop where local adults can learn, teach, make, share and socialise. The Shed enables social interaction and community cohesion for socially isolated older men. ACAVA delivers courses and workshops focused on skills development. Participants work on practical projects, pursue hobbies, enjoy the benefits of meeting new people and gain access to a computer.

Essex

ACAVA operates three sites in Essex.

Hadleigh Old Fire Station

Community Cinema screenings presented five titles and a community screening of an NHS documentary. Other events included a Christmas Fair supporting local charities and a local community Craft Day.

Gatehouse Studios, Eastgate Gallery, Harlow

Regular exhibitions programme included Harlow College Showcase, International Women’s Day Exhibition and Heads on Paper by Jonathan Farningham.

Stoke-on-Trent

In 2016, in collaboration with Stoke-on-Trent City Council and Arts Council England, we built 43 new studios, gallery and CPD programmes in an ambitious regeneration of the post-industrial Spode ceramics factory an important 250 year old heritage site .

Spode Works Gallery

Exhibitions included Dan Southward, Logically Unacceptable Conclusions.

Factory

A monthly skills development programme that supports Staffordshire based artists, designers, makers and small creative enterprises to develop their practice and business skills in partnership with Staffordshire Chambers of Commerce, Staffordshire University and the British Ceramics Biennial. Sessions have covered Pricing, Imposter Syndrome, Networking, Prepare to Sell/Selling online, Photographing your work, From Physical to Digital During COVID-19, Funding and Finance.

Artist studio events

Open studios welcome the public into our studio buildings to meet artists and learn about the creative process in the context of a creative production workspace. Events have been severely reduced by COVID-19 restrictions during the reporting period.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

In November 2019 ACAVA Ardleigh Studios, Colchester held an open Festive Studios event.

In July 2020 the Riverside Artists Group London launched Lockdown Exhibition an online exhibition of artworks created during lockdown by 16 of its members.

Financial review

Overview

During the 12 month period income was £1,879,736 (2019: £2,200,423 – 18 months) with expenditure of £1,909,166 (2019: £2,683,400 – 18 months).

For the 12 month period ended 30 September 2020, the charity incurred a deficit of £29,430. In the previous 18 month period, a deficit of £482,977 was incurred.

Updated cloud based finance and property management systems have created more transparent and efficient management and enabled a seamless transition from office based to remote working. External management accountants appointed in March 2020 significantly strengthened financial management, finance communications and reporting. This has been key to handling the unprecedented levels of negotiations with studio holders, stakeholders, funders, bank and landlords through the pandemic.

Financial management

An experienced interim part time Financial Director was contracted from specialist cultural and third sector firm Counterculture Partnership LLP. The appointment was supported by a full time agency bookkeeper employed at the same time. ACAVA’s existing part time Finance Officer remained in post.

In recent years, the charity has been navigating a challenging financial period caused by increasing operational costs, reduced development opportunities, inflation in the London property market and the impact of Covid 19.

This has been partially mitigated by the sale of shared ownership live/work properties in ACAVA’s Honeypot Lane portfolio in previous years which generated £899,000. The sale of the last of the five properties at Honeypot Lane was expected to complete during the 2018/19 period with a projected income of £262,500. The property was sold in February 2020, generating £247,500 (75% of £330,000), £15,000 below projections.

Consequently, it was necessary to renew the charity’s overdraft to manage cash flow. The agreement had two conditions: the sale of the final unit at Honeypot Lane and achieving a high rate of increased income from studio license fees.

In April 2019, the charity increased licence fees by an average 16%, which met the bank’s lending requirements. This helped to achieve a subsequent overdraft renewal, a further temporary increase

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

and gave the bank confidence that progress was being made on financial recovery other than solely by the unsustainable sale of property assets. Due to the Covid 19 pandemic, no further increase to licence fees have been made. However, budgets are being set to ensure future profitability and viability of the property portfolio.

Throughout this period, changes have continued to be made that recalibrate the business model, improve financial performance, manage cash flow, reduce debt and stabilise the financial position.

Finance staff capacity was augmented by contracting external management accountants in March 2020 increasing capability at a reduced cost.

The complex migration of data from old finance systems to new and the resetting of accounting and business processes has taken time to complete. The outcome is a positive step change in the management of the charity's finances critical to its financial recovery.

There are several short and longer term objectives planned that will continue financial recovery, albeit their implementation has been slowed by the impact of COVID-19. Proposals include the delivery of a fundraising strategy (implemented in May 2021), diversification of income through commercial activities, increased margins from studio buildings, comprehensive changes to utilities recharging (progressing in 2021), debt recovery, reduction of business rates, refinancing, negotiations to reduce rents, exiting unprofitable buildings, generating value from long leasehold properties and income generating development of freehold properties.

Property assets

The charity’s shares in five live/work properties at Honeypot Lane are restricted under a section 106 agreement but could be sold on when this expires in approximately four years.

The balance sheet shows two freehold property assets historically valued at £110k. It should be noted that surveys carried out on behalf of our bank in July 2019 value them at £783,000 and £660,000 a potential market value of £1,443,000. The charity does not intend to dispose of these assets but is considering the potential to redevelop them.

The two freehold properties have the potential to generate considerable funds that would be used to refurbish studios in the London Borough of Hammersmith and Fulham. Plans have been drawn up and discussions with the local authority have been positive. A pre-planning application was submitted in August 2020.

Principal risks and uncertainties

The charity maintains a detailed risk register that is reviewed and discussed at board and management team meetings. The highest priority risks and mitigating actions are listed below.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

Economic downturn

Unprecedented economic and political uncertainty caused by the UK leaving the EU and the global impacts of the COVID-19 pandemic are of concern to the immediate and long term future of the charity.

ACAVA has successfully navigated the challenges of the COVID-19 pandemic until now, however, the arts and the charity sectors face a difficult future in the short term.

Many studio holders are freelancers who work in the creative sector and have experienced lost, or much reduced, incomes. International working is an important part of cultural production and presentation, and international cultural exchange has been radically curtailed.

In mitigation, we introduced a light touch hardship fund in May 2020 that supports studio holders to maintain their studios by offering discounts to studio licence fees and utilities based on need. The organisation has focused on minimising void periods, increased marketing and communications about vacant studios, extended newsletter circulation and information about income making opportunities, successfully applied for C-19 recovery funding to underpin the hardship fund, strengthen capacity and resilience, and support a step change in fundraising, communications and administration.

Profitability

Several buildings are loss making, where income received does not cover that building's expenditure. These losses are unsustainable. The historical model of cross-subsidy between buildings needs long term planning and revised pricing policies to correct.

In mitigation, the charity continues to focus on increasing its profitability and reducing historical debt. Excellent progress in finance and administration efficiencies that improve yield, minimise costs and streamline cash flow have been achieved and are under constant review and modification. Refinancing has temporarily strengthened the cash position and created some working capital. Property development projects are progressing at three sites and seek to increase the number and quality of workspaces and exterior landscapes to generate higher levels of income from studios and hires. Recent grant awards include provision for legal and professional fees towards negotiating either improved rental terms or exits from leases especially those that make a loss. Early lease exits are difficult to achieve and can be costly, however, a number of ACAVA lease terms will expire in the next two years.

Health and safety noncompliance

Maintaining health and safety compliance has been challenging with a small team and geographically distributed portfolio. There is high degree of risk related to this. COVID-19 has brought increased need for cleaning, hygiene, logistics and general facilities management. In mitigation we appointed a temporary Health and Safety Manager on a fixed term contract who made excellent progress with policies and procedures bringing the organisation in line with legal requirements. They have now moved on but this post remains a key area for capacity building. Financial planning account for the need to appoint several roles including a senior property team leader with the appropriate health and safety experience. ACAVA's public spaces closed and re-

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

opened during COVID-19 lockdowns in 2020 and in 2021. H&S and C-19 policies have been developed and regularly updated.

Capacity

The organisation is managed by a comparatively small core team augmented by a full time external management accountant and specialists in HR, fundraising, property development and regeneration on a project basis as required. This causes several risks to property management with persistently heavy workloads in all teams and the potential loss of valued employees.

In mitigation, where feasible, employees’ terms and conditions have been modestly improved and a supportive culture of collaboration is nurtured. The charity identified new roles that have been temporary funded through grants, specifically – Administrator, Head of Fundraising, Fundraising Consultant (p/t), Head of Communications. Grants contributed towards increasing the Communications Manager from one to four days p/w and to the permanent appointment of a Head of Finance and Administration by covering the first year’s salary (in recruitment).

When compared to similar organisations, ACAVA’s leadership and senior management teams are significantly under resourced and the property team is also stretched beyond capacity.

Strengthening these teams is a long term objective - financial planning, fundraising, organisational development and new business development prioritise both capacity and increased/diversified income.

Safeguarding vulnerable people

The charity maintains comprehensive up to date policies and procedures that ensure the safety and wellbeing of vulnerable people of all ages. We follow NSPCC best practice in policies relating to children and young people, and access relevant local Safeguarding Children Board training for staff and freelancers.

Children and Young People (CYP) policies

Safeguarding CYP Policy Statement (Jan 2020), Safeguarding CYP in School Settings (Jan 2020), Safeguarding CYP in Community Settings (Jan 2020), Local Authority Designated Officer (LADO) Procedure for Allegations against Professionals (Jan 2020), CYP Anti-bullying Statement (Aug 2020).

Adults at Risk policies

Safeguarding Adults at Risk Policy (Dec 2019), Mental Capacity Act Policy (May 2019), ACAVA Data Protection Policy (Jul 2018).

Reserves policy and going concern

Reserves

Reserves have been depleted in recent years. Total reserves on 30 September 2020 were £830,265 (2019: £859,695).

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

Of this £154,296 (2019: £52,925) were held as restricted funds.

Excluding property assets, bank loans and restricted funds, unrestricted general funds were negative £377,222 (2019: £375,057). It should be noted that this includes deposits from tenants of £195,640.

Our reserves policy sets a minimum target of £24,000 p/a for unrestricted reserves over the next five years with a target of £120,000.

It is our policy that unrestricted funds which have not been designated for a specific use should be maintained at a level equivalent to between three and six months' expenditure. The trustees consider that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the charity’s current activities while consideration is given to ways in which additional funds may be raised.

Bank loans

In February 2020, our overdraft limit was reduced to £50,000 and has not been needed since.

The charity continued to meet its monthly loan repayments. No new loans were applied for.

Going concern

Trustees believe the charity is a going concern having made excellent progress over the past year on restructuring which has led to a stabilised financial position. This work is ongoing and will require more time to complete.

At the time of reporting cash flow is under control, the overdraft limit has been reduced to £50,000 and has not been needed. Discussions with our bank suggest that we will remove the overdraft in the near future but no date has been set.

The reduction of historical debt is being addressed through measures that have already been implemented, are in progress or are planned as detailed elsewhere in this report. Grant funding of £554,881 raised from statutory bodies in the six months between May and October 2020 is evidence of broad support for ACAVA's progress. The charity has clearly been acknowledged as a critical part of the UK's creative and cultural infrastructure.

In March 2021, we were awarded a further £208,477 from the DCMS/Arts Council England Culture Recovery Fund Round 2, the maximum amount available to us. Since May 2020, we have been awarded over £750,000 in emergency grant income which has enabled the continuation of the hardship fund, partially covers lost income, enables temporary capacity building in fundraising and communications and enables a property development feasibility study led by an experienced architecture and urban planning practice.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

We are actively targeting statutory funders, trusts and foundation, major donations, legacies, corporate foundations, in-kind partnerships and capital funds. A revised Case for Support was completed in June 2021 and ambitious fundraising targets have been set.

Property redevelopment of two sites is in planning and an extensive feasibility study and community consultation at another site, funded by DCMS/Arts Council England Culture Recovery Fund Round 2, begins in June 2021. Public fundraising campaigns are planned for two sites. New workspace and placemaking opportunities are actively being sought and if successful will generate new income streams.

Grant funding

£253,719 in restricted grant funding has been raised during the reporting period.

ACAVA has received endorsements from several funders who have generously supported our recovery strategy and plans. During 2020/21, we received grants from the Arts Council England Emergency Response Fund, Creative Land Trust and the Mayor of London Creative Workspace Resilience Fund and Arts Council England/DCMS Culture Recovery Fund rounds 1 and 2 (R2 in March 2021).

ACAVA's fundraising is compliant with fundraising regulation and codes. We are not aware of any non-compliance with any code and no complaints about the organisation's fundraising activities have been received. Until now, the organisation has not used professional fundraisers or commercial participators. No third parties have carried out fundraising activity on behalf of the charity.

COVID-19

The impact of the COVID-19 pandemic on the charity has been severe. There have been three main issues: an immediate shortfall in income from studios and licence fee increases not applied as planned, the closure of public facilities and the need to invest in staff capacity in communications and health and safety as workloads increased dramatically.

ACAVA's studio holders are predominantly freelance education and cultural sector workers, sole traders or not for profit organisations. The sudden closure of education and cultural institutions caused by COVID-19 and lockdown decimated the livelihoods of thousands and caused a national crisis for workspace providers. Many studio holders were unable to pay their licence fees leading to unprecedented cash flow difficulties for the charity.

The latest figures indicate a shortfall in income from unpaid licence fees and utilities of between 15% - 20%. Additionally, plans to increase income by 7% during 2020 have not been possible to implement and consequently represents a loss of income. It is unclear at this time what the equivalent loss will be during the 2021 calendar year with ongoing uncertainty regarding future

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

lockdowns, funding support, the furlough scheme, loan deferrals, bank support and the opening up of the cultural, entertainment and hospitality sectors, and travel related restrictions.

The charity has been energetically proactive in response to these challenges and taken the following mitigating actions, which have been effective:

Plans for the future

The charity aims to generate sufficient income to continue to deliver its two main activities:

Creative workspace and facilities

The provision of workspace and facilities that support artists of all disciplines, but primarily in the visual arts, and enable the production of art and culture.

To maintain the necessary number of buildings and studio holders, the charity continually seeks new opportunities to establish studio buildings in London and the UK regions.

Increasingly, this requires dialogue with potential stakeholders working in placemaking and regeneration contexts where art, culture and the creative industries are recognised drivers key to community participation and cultural engagement.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

It is essential to position ACAVA visibly with regeneration agencies, third sector organisations, cultural sector partners, businesses, architects, property developers, local and regional authorities, national government bodies and statutory funders.

Our future strategy includes increased communications, targeted marketing, and relationship building.

In recent years, the charity has established new buildings in three UK regions and will continue to explore similar opportunities in different parts of the country to reach a wider range of communities and beneficiaries with studio and workspace provision allied to ambitious community engagement programmes.

Programmes

ACAVA has accumulated unique knowledge and experience in community and wellbeing settings and we aim to build on and expand our delivery of this work.

To support this, we plan to carry out external evaluation and impact studies that capture our achievements. Robust research based evidence will strengthen advocacy, celebrate our work, and increase the organisation's profile with potential collaborators.

An enhanced digital footprint including a refreshed identity, new website and enhanced digital content across all platforms will launch in Winter 2020.

We will seek to maximise income generating potential of properties across the portfolio including developing sites, increasing the number of studios.

Other initiatives will be introduced to diversify income streams beyond our traditional approach to fundraising to include commercial income generation, for example, from hires.

Structure, governance and management

Association for Cultural Advancement through Visual Art (ACAVA) is a charitable company limited by guarantee, incorporated on 2 September 1983, and registered as a charity on 29 March 1984. The company is governed by Articles of Association revised, updated, and adopted on 29 January 2020.

Objects

The Charity’s Object is:

For the public benefit in the UK, to advance education in the arts and culture, in particular but not exclusively by providing opportunities for the creation and display of art and access to courses, events and workshops.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

The main activities undertaken to achieve those purposes are:

The board of trustees administers the charity and meets a minimum of four times a year. Two sub-committees that meet regularly between board meetings have oversight of specific areas of business: Finance and General Purposes Sub-Committee and Property Sub-Committee report and make recommendations to the board.

The CEO reports to the trustees and has authority over all operational matters including business development, strategy, finance, fundraising, HR, studio operations, policies, communications, and programmes.

The trustees review the aims, objectives, and activities of the charity each year. This report looks at what the charity has achieved and the outcomes of its work in the reporting period.

The review also helps the trustees ensure the charity's aims, objectives and activities remained focused on its stated purposes.

Trustees give their time voluntarily and receive no benefits from the charity.

Management

Internal systems and processes have been updated with integrated cloud computing systems deployed in finance, property management, studio allocations, general administration, and internal communications. This has delivered significant improvements in efficiency and enabled collaborative working and knowledge sharing essential during the pandemic. Our office was closed in March 2020 and staff continue to work remotely.

Appointment of trustees

Prospective trustees are identified through a formal recruitment process. A trustee recruitment pack is circulated via the charity's website, social media, public mailing lists and personal networks.

The charity retains the services of a HR consultant who acts as an independent adviser, responds to enquiries, reviews applications, and carries out an initial conversation with applicants. Shortlisted candidates are invited to meet trustees and, at a separate meeting, the CEO, prior to attending a board meeting as an observer where they are briefed on trustees’ obligations, the organisation’s business plan, financial performance, and risk management.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

New trustees may only be appointed by a formally convened meeting of the board of trustees. Once appointed, trustees undertake a thorough induction to the organisation by the Chief Executive Officer.

Remuneration policy for key management personnel

When recruiting for the post of Chief Executive Officer in 2018 trustees employed a specialist recruitment consultant. The salary was for the role was aligned with that of the outgoing post holder.

In August 2019, the charity's HR adviser was briefed to undertake a benchmarking survey to ascertain whether its salary levels were competitive.

The method included obtaining salary ranges of similar roles, using knowledge of the sector, sector surveys, advertised salaries and contacts in the arts. Salaries were compared with the general not for profit sector as well as the arts. Where possible, similar sized organisations were used as comparators.

Statement of responsibilities of the trustees

The trustees (who are also directors of Association for Cultural Advancement Through Visual Art for the purposes of company law) are responsible for preparing the trustees’ annual 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.

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Association for Cultural Advancement Through Visual Art

Trustees’ annual report

For the year ended 30 September 2020

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.

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

The trustees’ annual report has been approved by the trustees on 24 June 2021 and signed on their behalf by

Name: Michelle Kershaw

Title: Chair of the Board of Trustees

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Independent auditor’s report

To the members of

Association for Cultural Advancement Through Visual Art

Opinion

We have audited the financial statements of Association for Cultural Advancement Through Visual Art (the ‘charitable company’) for the period ended 30 September 2020 which comprise the statement of financial activities, balance sheet, statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

18

Independent auditor’s report

To the members of

Association for Cultural Advancement Through Visual Art

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. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

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:

19

Independent auditor’s report

To the members of

Association for Cultural Advancement Through Visual Art

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 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.

As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

20

Independent auditor’s report

To the members of

Association for Cultural Advancement Through Visual Art

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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.

Judith Miller (Senior statutory auditor) 28 June 2021

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

21

Association For Cultural Advancement Through Visual Art

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

For the year ended 30 September 2020

For the year ended 30 September 2020
Note
Income from:
2
3
3
4
5
6
6
7
Reconciliation of funds:
Total funds carried forward
Transfers between funds
Net movement in funds
Total funds brought forward
Net income / (expenditure) for the period
Community programme
Studio provision
Total expenditure
Charitable activities
Community programme
Studio provision
Other
Total income
Expenditure on:
Other trading activities
Donations and legacies
Charitable activities		 Unrestricted
£
24,132
-
1,305,078
124,336
172,471		 Restricted
£
-
250,344
3,375
-
-		 12 months
ended 30
September
2020
Total
£
24,132
250,344
1,308,453
124,336
172,471		 Unrestricted
£
4,170
13,719
2,026,313
40,250
920		 18 months
ended 30
September
2019
Restricted
Total
£
£
3,531
7,701
111,520
125,239
-
2,026,313
-
40,250
-
920
115,051
2,200,423
125,990
195,670
-
2,487,730
125,990
2,683,400
(10,939)
(482,977)
(855,208)
-
(866,147)
(482,977)
919,072
1,342,672
52,925
859,695
1,626,017 253,719 1,879,736 2,085,372
9,588
1,747,230		 152,348
-		 161,936
1,747,230		 69,680
2,487,730
1,756,818 152,348 1,909,166 2,557,410
(130,801)
-		 101,371
-		 (29,430)
-		 (472,038)
855,208
(130,801)
806,770		 101,371
52,925		 (29,430)
859,695		 383,170
423,600
675,969 154,296 830,265 806,770

All of the above results are derived from continuing activities. There were no other recognised gains or losses other than those stated above. Movements in funds are disclosed in Note 19 to the financial statements.

22

Association For Cultural Advancement Through Visual Art

Company no. 01749730

Balance sheet

As at 30 September 2020

Note
Fixed assets:
12
Current assets:
13
Liabilities:
14
15
16
18
19
Total unrestricted funds
Restricted income funds
Unrestricted income funds:
Designated funds
General funds
Total charity funds
Debtors
The funds of the charity:
Creditors: amounts falling due within one year
Net current liabilities
Total net assets
Provisions for liabilities
Creditors: amounts falling due after one year
Total assets less current liabilities
Cash at bank and in hand
Tangible assets		 £
366,663
201,387		 2020
£
£
1,417,207
1,417,207
302,935
3,269
306,204
(651,672)
(225,589)
1,191,618
(351,353)
(10,000)
830,265
154,296
1,181,827
(375,057)
675,969
830,265		 2019
£
1,593,971
1,593,971
(345,468)
568,050
(793,639)
1,053,191
(377,222)
1,248,503
(377,732)
(11,076)
859,695
52,925
806,770
859,695

Approved by the trustees on 24 June 2021 and signed on their behalf by

Michelle Kershaw Chair of the Board of Trustees

23

Association For Cultural Advancement Through Visual Art

Statement of cash flows

For the year ended 30 September 2020

For the year ended 30 September 2020 For the year ended 30 September 2020 For the year ended 30 September 2020
Note
£
£
Cash flows from operating activities
Net income/(expenditure) for the reporting period
(29,430)
(as per the statement of financial activities)
Depreciation charges
108,265
(Profit)/loss on disposal of fixed assets
(172,471)
(Increase)/decrease in debtors
(63,728)
Increase in creditors
234,209
Decrease in provisions
(1,076)
Net cash provided by/(used in) operating activities
75,769
245,515
(4,545)
240,970
(48,128)
(48,128)
268,611
(67,224)
a
201,387
At 30
September
2019
Cash flows
£
£
Cash at bank and in hand
3,269
198,118
Overdraft facility repayable on demand
(70,493)
70,493
a
Total cash and cash equivalents
(67,224)
268,611
Loans falling due within one year
(42,012)
26,949
Loans falling due after more than one year
(370,132)
21,179
Total net debt
(479,368)
316,739
Analysis of cash and cash equivalents and of net debt
Cash and cash equivalents at the end of the period
Net cash (used in) financing activities
Change in cash and cash equivalents in the period
Repayments of borrowing
Cash flows from financing activities:
Cash and cash equivalents at the beginning of the
period
Net cash provided by/(used in) investing activities
Cash flows from investing activities:
Proceeds from the sale of fixed assets
Purchase of fixed assets
12 months ended 30
September 2020		 £
£
(482,977)
158,110
58,577
47,579
96,206
(44,827)
(167,332)
-
(11,764)
(11,764)
(102,088)
(102,088)
(281,184)
213,960
(67,224)
Other
non-cash
changes
At 30
September
2020
£
£
-
201,387
-
-
-
201,387
-
(15,063)
-
(348,953)
-
(162,629)
18 months ended 30
September 2019
245,515
(4,545)		 -
(11,764)
(48,128) (102,088)
At 30
September
2019
£
3,269
(70,493)		 Other
non-cash
changes
£
-
-
268,611
(67,224)		 (281,184)
213,960
201,387 (67,224)
Cash flows
£
198,118
70,493		 At 30
September
2020
£
201,387
-
(67,224) 268,611 - 201,387
(42,012)
(370,132)		 26,949
21,179		 -
-		 (15,063)
(348,953)
(479,368) 316,739 - (162,629)

24

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

1 Accounting policies

a) Statutory information

Association for Cultural Advancement through Visual Art (ACAVA) is a charitable company limited by guarantee and is incorporated in England and Wales.

The registered office address is 54 Blechynden Street, London W10 6RJ.

b) Basis of preparation

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

c) Public benefit entity

The charity 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 charity's ability to continue as a going concern.

As at 30 September 2020, the trustees are confident that ACAVA is a going concern and the financial statements have been prepared on that basis. In the period between the period end and May 2021, the financial position has continued to improve, with the receipt of grant income from The Arts Council Cultural Recovery Fund, Round 1 & 2, which has injected cash into the organisation and funded salaries and other costs. The organisation continues to receive a consistent and stable stream of licence fees. In addition, ACAVA has continued to apply for a number of grants to support its ongoing activities, and long term strategy. The cash position is good, and is anticipated to remain so for the foreseeable future. In addition, ACAVA is in the fortunate position of owning a number of property assets where the market value far exceeds the carrying value in the financial statements.

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.

e) Income

Income is recognised when the charity has entitlement to the funds, any performance conditions attached to the income have been met, it is probable that the income will be received and that the amount can be measured reliably.

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.

Project fees are treated as income when the services have been met. Income received in advance of the provision of a specified service is deferred until the criteria for income recognition are met.

Licence fees and rental income are treated as income when the space has been utilised by the hiree.

Income is recognised on the sale of property assets when they have legally exchanged.

f) Interest receivable

25

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

1 Accounting policies (continued)

g) Fund accounting

Restricted funds are to be used for specific purposes as laid down by the donor. Expenditure which meets these criteria is charged to the fund.

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.

i) Allocation of support costs

Resources expended are allocated to the particular activity where the cost relates directly to that activity.

Governance costs are the costs associated with the governance arrangements of the charity. These costs are associated with constitutional and statutory requirements and include any costs associated with the strategic management of the charity’s activities.

j) Operating leases

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

k) Tangible fixed assets

Items of equipment are capitalised where the purchase price exceeds £500. 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. Major components are treated as a separate asset where they have significantly different patterns of consumption of economic benefits and are depreciated separately over its useful life.

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:

50 years Over the term of the lease Over the term of the lease 3 - 10 years

l) Debtors

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

m) Cash at bank and in hand

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.

n) Creditors and provisions

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.

o) 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.

26

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

1 Accounting policies (continued)

p) Pensions

2 Income from donations and legacies

Donations
Government grants
Community programme
Studio provision
Membership fees
Sub-total for Community
programme
Licence fees
Grants and donations
Total income from charitable
activities
Income from charitable activities
Sub-total for studio provision		 Unrestricted
£
1,926
22,206		 Restricted
£
-
-		 12 months
ended 30
September
2020
Total
£
1,926
22,206		 Unrestricted
£
4,170
-		 Restricted
£
3,531
-		 18 months
ended 30
September
2019
Total
£
7,701
-
24,132 - 24,132 4,170 3,531 7,701
Unrestricted
£
-		 £
250,344
Restricted		 12 months
ended 30
September
2020
Total
£
250,344		 Unrestricted
£
13,719		 £
111,520
Restricted		 18 months
ended 30
September
2019
Total
£
125,239
-
1,288,970
16,108		 250,344
-
3,375		 250,344
1,288,970
19,483		 13,719
2,021,232
5,081		 111,520
-
-		 125,239
2,021,232
5,081
1,305,078 3,375 1,308,453 2,026,313 - 2,026,313
1,305,078 253,719 1,558,797 2,040,032 111,520 2,151,552

3 Income from charitable activities

Rental income
All income from trading activities is unrestricted.
Utility recharges		 12 months
ended 30
September
2020
Total
£
26,597
97,739		 18 months
ended 30
September
2019
Total
£
40,250
-
124,336 40,250

27

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

5 Other income

Miscellaneous income
Profit on the sale of tangible fixed assets		 12 months
ended 30
September
2020
18 months
ended 30
September
2019
Total
Total
£
£
-
920
172,471
-
172,471
920

All other income is unrestricted.

28

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

6a Analysis of expenditure (current year)

Staff costs (Note 8)
Direct project costs
Property expenses
Insurance
Publicity
Legal and professional
Travel expenses
Rent
Bad debts
Office expenses
Bank charges and interest
Other
Hardship fund income relief granted
Depreciation and loss on disposal of assets
Support costs
Governance costs
Total expenditure 2020
Total expenditure 2019		 Charitable activities Charitable activities Governance
costs
£
-
-
-
-
-
12,000
-
-
-
-
-
-
12,000
-
(12,000)
-
-		 Support
costs
£
-
-
-
48,120
-
92,751
3,040
-
-
40,378
-
18,910
108,265
311,464
(311,464)
-
-
-		 12 months ended
30 September 2020
18 months ended
30 September 2019
£
£
367,390
493,646
118,273
189,567
271,857
385,583
48,120
73,817
5,704
6,103
104,751
155,388
3,040
6,363
697,653
1,005,266
61,987
-
40,378
111,025
24,879
35,888
18,910
4,067
37,959
-
108,265
216,687
1,909,166
2,683,400
-
-
-
-
1,909,166
2,683,400
Community
programme
£
-
118,273
-
-
5,704
-
-
-
-
-
-
37,959
-
161,936
-
-
161,936
195,670		 Studio
provision
£
367,390
-
271,857
-
-
-
-
697,653
61,987
-
24,879
-
1,423,766
311,464
12,000
1,747,230
2,487,730

29

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

6b Analysis of expenditure (prior year)

Charitable activities

Staff costs (Note 8)
Direct project costs
Property expenses
Insurance
Publicity
Legal and professional
Travel expenses
Rent
Office expenses
Bank charges and interest
Other
Depreciation and loss on disposal of assets
Support costs
Governance costs
Total expenditure 2019		 Community
programme
£
-
189,567
-
-
6,103
-
-
-
-
-
-
-
195,670
-
-
195,670		 Studio
provision
£
493,646
-
385,583
-
-
-
-
1,005,266
-
35,888
-
-
1,920,383
557,347
10,000
2,487,730		 Governance
costs
£
-
-
-
-
-
10,000
-
-
-
-
-
-
10,000
-
(10,000)
-		 Support
costs
18 months ended
30 September 2019
£
£
-
493,646
-
189,567
-
385,583
73,817
73,817
-
6,103
145,388
155,388
6,363
6,363
-
1,005,266
111,025
111,025
-
35,888
4,067
4,067
216,687
216,687
557,347
2,683,400
(557,347)
-
-
-
-
2,683,400

30

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

This is stated after charging / (crediting):

This is stated after charging / (crediting):
12 months 18 months
ended 30 ended 30
September September
2020 2019
£ £
Depreciation 108,265 158,110
(Profit)/loss on disposal of fixed assets (172,471) 58,577
Operating lease rentals payable:
Property 697,653 982,107
Auditor's remuneration (excluding VAT):
Audit 12,000 10,000
Other services 8,400 3,000

Staff costs were as follows:

Total
Employer’s contribution to defined contribution pension schemes
Social security costs
Salaries and wages		 12 months
ended 30
September
2020
18 months
ended 30
September
2019
£
£
335,743
453,303
26,555
34,498
5,092
5,845
367,390
493,646

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

2020 2019
No. No.
£60,000 - £69,999 1 -

The total employee benefits (including pension contributions and employer's national insurance) of the key management personnel were £72,025 (2019: £83,523). The 2019 figure relates to an 18 month period, whereas the 2020 figure is for a 12 month period.

The charity trustees were neither paid nor received any other benefits from employment with the charity in the period (2019: £nil). No charity trustee received payment for professional or other services supplied to the charity (2019: £nil).

No trustees claimed expenses in the year (2019: £Nil)

9 Staff numbers

The average number of employees (head count based on number of staff employed) during the period was 26 (2019: 24).

10 Related party transactions

There are no related party transactions to disclose for 2020 (2019: none).

Aggregate donations from related parties were £nil (2019: £nil).

31

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

11 Taxation

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

12 Tangible fixed assets

Tangible fixed assets
At the end of the period
Cost
At the start of the period
Eliminated on disposal
At the end of the period
Net book value
At the end of the period
At the start of the period
Charge for the period
At the start of the period
Additions in period
Disposals in period
Depreciation		 Freehold
property
£
157,033
-
-		 Leasehold
property and
improvement
£
2,459,337
4,545
(79,449)		 Computer
equipment
£
174,298
-
-		 Total
£
2,790,668
4,545
(79,449)
157,033 2,384,433 174,298 2,715,764
47,349
3,140
-		 990,128
95,377
(6,405)		 159,220
9,748
-		 1,196,697
108,265
(6,405)
50,489 1,079,100 168,968 1,298,557
106,544 1,305,333 5,330 1,417,207
109,684 1,469,209 15,078 1,593,971

The trustees have undertaken an impairment review during the period of all fixed assets and are satisfied that there is no indication of impairment for any assets. In addition, it should be noted that the two freehold properties carried at historic cost, less depreciation, of £106,544 were revalued in July 2019, where the market value was deemed to be £1.443 million. The trustees continue to recognise all tangible fixed assets at historic cost rather than adopt a revaluation model and so this valuation has not been reflected in the above figures.

All of the above assets are used for charitable purposes.

13 Debtors

Trade debtors
Other debtors
Prepayments and accrued income		 2020
2019
£
£
68,843
78,662
275
-
297,545
224,273
366,663
302,935

14 Creditors: amounts falling due within one year

Other creditors
Bank loans
Accruals
Trade creditors
Taxation and social security
Overdraft		 2020
2019
£
£
-
70,493
15,063
42,012
444,346
297,925
86,700
25,077
219,810
190,560
27,720
25,605
793,639
651,672

32

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

15 Creditors: amounts falling due after one year

Bank loans
Other creditors		 2020
2019
£
£
348,953
370,132
2,400
7,600
351,353
377,732

Bank loans totalling £364,016 (2019: £412,144) are secured by fixed charges over the Association's freehold properties at 62 Hetley Road and 23 to 20 Faroe Road and long leasehold property interests.

16 Provisions for liabilities

Provisions for liabilities comprises a dilapidation provision relating to operating leases on studios.

Balance at the beginning of the period
Decrease in provision in the period
Balance at the end of the period		 2020
2019
£
£
11,076
55,903
(1,076)
(44,827)
10,000
11,076

18a Analysis of net assets between funds (current period)

Long term liabilities
Net current assets/(liabilities)
Tangible fixed assets
Provisions for liabilities
Net assets at 30 September 2020		 General
unrestricted
£
-
(364,822)
(2,400)
(10,000)		 Designated
£
1,417,207
(15,063)
(348,953)
-		 Restricted
Total
funds
£
£
-
1,417,207
154,296
(225,589)
-
(351,353)
-
(10,000)
154,296
830,265
(377,222) 1,053,191

18b Analysis of net assets between funds (prior period)

Long term liabilities
Provisions for liabilities
Net assets at 30 September 2019
Net current assets/(liabilities)
Tangible fixed assets		 General
unrestricted
£
-
(356,381)
(7,600)
(11,076)		 Designated
£
1,593,971
(42,012)
(370,132)
-		 Restricted
Total
funds
£
£
-
1,593,971
52,925
(345,468)
-
(377,732)
-
(11,076)
52,925
859,695
(375,057) 1,181,827

33

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

19a Movements in funds (current year)

Total restricted funds
Total designated funds
General funds
Property
Project funds
Grants
Restricted funds:
Total unrestricted funds
Unrestricted funds:
Designated funds:
Total funds		 At 30
September
2019
£
52,925
-		 Income &
gains
£
113,624
140,095		 Expenditure &
losses
£
(112,468)
(39,880)		 Transfers
£
-
-		 At 30
September
2020
£
54,081
100,215
52,925 253,719 (152,348) - 154,296
1,181,827 - - (128,636) 1,053,191
1,181,827 - - (128,636) 1,053,191
(375,057) 1,626,017 (1,756,818) 128,636 (377,222)
806,770 1,626,017 (1,756,818) - 675,969
859,695 1,879,736 (1,909,166) - 830,265

The narrative to explain the purpose of each fund and the reason for the transers are given at the foot of the note below.

19b Movements in funds (prior period)

Movements in funds (prior period)
Total restricted funds
Total designated funds
General funds
Total unrestricted funds
Total funds
Capital fund
Unrestricted funds:
Designated funds:
Property
Project fund
Restricted funds:
Project funds		 At 1 April
2018
£
855,208
63,864		 Income &
gains
£
-
115,051		 Expenditure &
losses
£
-
(125,990)		 Transfers
£
(855,208)
-		 At 30
September
2019
£
-
52,925
919,072 115,051 (125,990) (855,208) 52,925
540,617
11,188		 -
-		 (216,687)
(11,188)		 857,897
-		 1,181,827
-
551,805 - (227,875) 857,897 1,181,827
(128,205) 2,085,372 (2,329,535) (2,689) (375,057)
423,600 2,085,372 (2,557,410) 855,208 806,770
1,342,672 2,200,423 (2,683,400) - 859,695

Purposes of restricted funds

Capital fund

The capital fund was for the refurbishment of Blechynden Studios and other capital purchases where expenditure was specified by the donor, Arts Council England. A charge was held over this asset for an initial period following the refurbishment, however this charge has now been satisfied. As such, the assets have been reclassified as unrestricted funds as there is no expectation that any funds require repayment to the donor.

Project fund

This relates to charitable activity projects funded by specific grants by donors.

34

Association For Cultural Advancement Through Visual Art

Notes to the financial statements

For the year ended 30 September 2020

19 Purposes of designated funds

Property

This represents the net book value of all tangible fixed assets as these do not form part of the free reserves of the charity less the value of bank loans secured on these properties.

Project fund

This relates to resources allocated to earmarked projects identified by the trustees.

20 Operating lease commitments payable as a lessee

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

Total
Less than one year
One to five years
Over five years		 2020
2019
£
£
665,399
665,787
2,031,423
2,099,786
3,031,215
3,217,686
5,728,037
5,983,259
Property

The future commitments includes the liability for a rent review of a property, that took place after the year end. However, the increased liability has been included above, as the review created a genuine future commitment for that lease.

21 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.

35