SOUTHBANK CENTRE Annual Report and Financial Statements 2022-23 Presented to Parliament pursuant lo Section 47131 of the Local Government Act 1985 Supported usingpublicfundingby HERE FOR CULTURE ARTS COUNCIL ENGLAND SOUTHBANK CENTRE Annual Report and Financial Statements 2022-23 Presented to Parliament pursuant lo Section 47131 of the Local Government Act 1985 co Supported usingpublicfundingby HERE FOR CULTURE ARTS COUNCIL ENGLAND Southbank Cemre Copyri8ht120231 Thetext ofthis Io¢vMent (this ex¢lvdes.where piesent.the RoyalArms alldepaitmental oragenty l08osl maybe ieproducedfreeof thar8e In anv The matenal must beacknowledBed Bs Southbankcentre copyright and the documenttitle specified. Southb3nkCentre, London. SE18XM 158N 978.1-1999.6043-4 SOUTHBANK CENTRE ANNUAL REPORT AND FINANCIAL STATEMENTS 2022- 2023 CONTENTS Page Professional Advisors Board of Governors and Executive Leadership Team Chair's Foreword Chief Executive Officer's Foreword Arts'stic Director's Foreword Report of the Trustee Financial Review Statement of Trustee's Responsibilities 24 Independent Auditors, Report 25 Consolidated Statement of Financial Activities 28 Balance Sheet 29 Consolidated Statement of Cash Flows 31 Notes lo the Financial Statements 32 REFERENCE AND ADMINISTRATION DETAILS Registered as a Charity No. 298909 Principal office Belvedere Road London SE1 8XX PROFESSIONAL ADVISORS BANKERS Lloyds TSB Bank plc 4th Floor 25 Gresham Street London EC2V 7HN AIB Group IUKI plc 9110 Angel Court London EC2R 7AB SOLICITORS Herbert Smith Freehills LLP Exchange House Primrose Street London EC2A 2HS Fsrrer and Co LLP 66 Lincoln's Inn Fields London WC2A 3LH INDEPENDENT AUDITORS Crowe U.K. LLP 55 Ludgale Hill London EC4M 7JW BOARD OF GOVERNORS AND SENIOR STAFF BOARD OF GOVERNORS The Governors of the Board who served during the year and subsequently are and subsequently are.. Governor Misan Harriman (Chairl Glyn Aikins Venetia Bullerfield Michael Hussey Dame Vivian Hunt Luke Mayhew (Deputy Chairl Sandy Rattray William Sargent Lisbelh Savill Lynne Shamwana Kieron Boyle Anais Hayes Salman Mahdi Jerome Misso Ndidi Okezie OBE appointed 14 December 2022 appointed 14 December 2022 appointed 14 December 2022 appointed 14 December 2022 appointed 14 December 2022 EXECUTIVE LEADERSHIP TEAM The Chief Executive and other senior staff to whom day-to-day management of the charity is delegated by the Govemors are". Elaine Bedell Mark Ball Nicola Cardillo-zallo Heather Clark-charringlon Susan Johnston Amy Ross CEO Artistic Director Director of People and Culture Director of Audiences Chief Operating Officer Director of Development Purpose To offer inspirational life-enhancing encounters with art in democratic, open spaces. Vision To have the most vibrant, innovative, welcoming and inclusive arts spaces in the world, renowned for championing the imagination of artists, audiences and communities. Chair's foreword This has been My first full year as Chair of the Southbank Centre and seeing the organisation hitting its stride has been truly invigorating. The work that we've been doing this last year demonstrates more than ever our determination to be the most open and accessible as well as the most innovative arts centre in the world. The year has been another one full of challenges, especially financial, bul the Southbank Centre has remained resilient and robust. Audiences have returned in larye numbers to our world-class classical and contemporary music concerts, literature and performances in the UK'S three pre-eminent concert halls and enjoyed highly rated visual art exhibitions in the inlernalionally-acclaimed Hayward Gallery. We were proud lo play our part in the national story as we hosted the queues for Her late Majesty's lying in slate and we remained open all night during the extraordinary period of National Mourning, providing warm spaces, cafes and facilities for those queuing. We were honoured lo live-stream HM The Queen's funeral to audiences in the Queen Elizabeth Hall. As we look to redefine access lo art151ic forms we have started rolling out a bold new plan for Classical Music- New Future- based on innovation, diversity, inclusivity and excellence. Classical music is a key part of what we do bul we have not seen audiences return lo the Royal Festival Hall in the same way as in many other genres. We want to ensure classical music remains relevant and can respond lo and reflect our rapidly changing society as well as celebrate world class classical musie performances on our stages. New Future shows that Southbank Centre wants to push artforms, drive innovation and create new opportunities to access arts and culture. But as well as innovation in programming, we have a chance and responsibil((y lo show innovation in improving the opportunities for the artists of the future. We were therefore thrilled to announce our groundbreaking partnership with Apple to create Rgframe, which is empowering the next generation of Black creatives in the UK. We're also delighted to be working with Bloomberg Philanthropies, Digitsl Accelerator Programme. This allows us to enhance our digital infraslruclure and slay at the cutting edge of artistic and technical development. These are the kinds of international partnerships I want us to build on and do more of in the future. As we look to 2023124, our innovation hub Southbank Genlre Studio will enable the most cutting edge creatives to develop their art and collaborate using the Purcell Room as their base demonstrating our commitment lo supporting artists and pushing innovation in art forms. This summer the whole sile will reflect the Hayward Gallery's Dear Earth exhibition., creating, a sile- wide festival fo¢ussed on ¢limale activism, Planet Summer. I'd like to thank the Executive Team for their hard work and all the incredible Soulhbank Centre staff for continuing to provide world-bealing cultural experiences day after day. I'm also grateful for the continued support of Arts Council England. Their support is critical lo the challenge we face of not just creating an outstanding artistic programme bul maintaining the 11-acre sile we are responsible for on behalf of the government. The reduction of that support by nearly £1.9m, the prospect of our energy costs increasing annually by over £1.8m, and the increasing need for us to reinvest in the Royal Festival Hall means that the coming years will undoubtedly be challenging and require us to find new ways to generate more revenue and to fi'nd new funding if we are going lo keep our burning artistic ambition alight. I'll be doing all I can, with my Board colleagues and the Executive team, to meet that challenge and ensure the Soulhbank Centre can play an even more vibrant role in the Arts and the communities il serves. Misan Harriman CEO'S foreword Regaining our place as one of the lop 5 Most visited attractions in the UK this year was testament to the very hard work everyone al Southbank has done to restore public confidence in our site as a must-visil place for memorable experiences and enlertainmenl. It's been wonderful lo see our terraces, walkways and foyers so lively and busy again and to witness our visitors enjoy the benefits of congregation, whether il's simply having a coffee in our cafes and feeling part of our diverse Soulhbank Centre community, or experiencing the thrill of world class live performan￿. After a busy summer culminating with Grace Jones's Meltdown Festival Inominaled for Music Week Festival of the Yearl and our In the BlaGk FantastlG Slte-wide programme, we were also delighted lo be awarded the first ever Platinum Award for accessibility from Attitude is Everything. The award demonstrates our determination to make the Soulhbank Centre the most welcoming and accessible place possible and we are the only cultural organisalion in the UK with such an award. I want to thank our amazing Visitor Experience and event management teams whose work makes the award possible. The New York Times also recognised the excellence of our work, the vibrancy and popularity of our venues, in an article ahead of us hosting of the BAFTA Film Awards". The Southbank Cenler, the host of this year's British Academy Film A wards. has become a focal point of the citys arts ènd culture scene." We were pleased to welcome Tim Cook, Apple CEO, to the Southbank Centre last Autumn lo launch our new innovative skills development partnership with Apple. As part of the partnership, Reframe is a new national programme to support emerging Black and Black Mixed Heritage artists develop their creative and digital skills. This programme reaches out across England as it's produced by the Soulhbank Centre in London wth Factory International in Manchester, Birmingham City University's STEAMhouse and Midlands Arts Cenlre. This unique collaboration is a model that we believe has great potential for the creative sector. This has been Mark Ball's first full year as Artistic Director and il's been fantastic lo see his creative ambition for Southbank Centre take shape, with some innovative and very SUC￿ssful events and interventions, including emotional concerts in support of Ukraine and the Women of Iran. The Hayward Gallery cemented its reputstion as the most innovative contemporary art gallery in London with a string of critically acclaimed exhibitions including Strange Clay.. Ceramics in Contemporary Art. the Iirsl large-scale group exhibition in the UK lo explore how contemporary artists are reinventing the possibilities of ceramics as well as Louise 8ourgeois, The Woven Child. Our Hayward Touring programme, which is created and managed by our Hayward touring curatorial team specifically for regional galleries lo present free exhibitions around the UK, has been engaging audiences with Hollow Earth.. Art, Caves and The SubterTrnean Imaginary in Notlingham, while British Art Show 9 opened In ils final two cities in 2022123, Manchester in May 2022 and in Plymouth in October 2022. Although we have a business model which enables us to be bold, ambitious and lo support new work, artists and staff, our Government-owned heritage estate increasingly needs renovation - not least to meet our sustainability go8ls- and we are making the case strongly to the Government and the Arts Council for urgent help with this work. We have met with much goodwill and sympathy but there now needs to be an urgent plan lo provide a suitably robust fund that can support our pressing need as well as the needs of the rest of the performing arts real estsle. Notwilhslanding these challenges, I'm Confident with our new artistic strategy, our organisational priorities and our entrepreneurial flair we are looking forward to another exciting year. I'd like to thank all the hard working staff at Southbank Centre, our freelancers, partners and all the artists and communities who've Contributed this year to making us the buzziest site in London (Daily Telegraph). Elaine Bedell Artistic Director foreword 2022123 has been my first full year as Arts'stic Director of the Southbank Centre. The year, which began with us tentatively emerging from the surge of Omicron Covid variant, has seen audiences and the public return with increasing confidence lo engage with a rich and diverse artistic programme. We have ended the year too by implementing a new artistic vision for Soulhbank Centre that focuses and coheres our work across multiple artforms and our 11-acre sile. That vision foregrounds inlerconnecled ambitions. Firstly lo become the nation's most culturally democratic and expressive Spa￿ for artists and audiences.. a deeply inclusive space for everyone lo engage in art and culture regardless of their economic, social and cultural backgrounds, made manifest by our commitment lo maintaining a large and free-to-access arts programme,. a space that lebrales and legilimises popular culture and where all of us can look together al how we live now and in the future through the lens of the arts. Secondly, lo become an Engine of Creativity, supporting artists to forge new artistic ideas and projects and driving innovation in artistic practices that will define our culture over the coming decades, whilst always investing in growing the skills and creative careers of young lalenl, especially talent drawn from backgrounds that have historically locked people out of our sector. In 2022123 the Southbank Cenlre's artistic programme successfully signalled this new focus. The Hayward Gallery's ground-breaking In the Black Fantastic exhibition plattormed new aeslhelics and thinking from Black artists. The launch of our classical music season driven by our New Futu￿ For Classical Music strategy profiled glorious new inlerpretalions of the canon, new formats and a feast of new music, including work from our recently refreshed cohort of Resident Orchestras". London Philharmonic Orchestra, Philharmonia Orchestra, Chinekel Aurora, the Orchestra of the Age of Enlightenment and the London Sinfonietla. Soulhbank Centre Studios was initiated to support adventurous artists lo collaborate across art forms, experiment with new technologies and create the art of the future. Dolly Parton's Christmas Carol and Hey Duggee packed in children and families during five weeks of Christmas entertainment and our Arts and Wellbeing programme developed with the National Centre for Social Prescribing continued to improve the lives and health of clinically vulnerable people. Looking forward to 2023124 we have a lol lo be excited by. Our summer-wide climate change programme. P12nel Summer, anchored by the Hayward Gallery's Dear Earth exhibition is a multi- arfomi exploration of climate care and activism., Performance and Dance returns ￿ntre stsge with an ambitious programme of new International work from some of the world's greatest live and performing artists,. Christine and the Queens steers a truly diverse and Inclusive Meltdown that platforms searing new musical talent,. the London Literature Festival focuses on the city s outstanding spoken word scene and. for the first lime in its history, is led by a curator, the incomparable wordsmith George the P￿1,. and the Imagine children's festival venture5 into the melaverse. As the new artistic vision lakes hold across the organisalion in the coming months l am confident that the art and engagement our teams work so hard lo enable will define what we, as Southbank Centre, stand for. Mark Ball ARTISTIC HIGHLIGHTS IN 2022123 Two outstanding concerts from the LPO and PO.. Gurrelieder and Mahler's Resurrection Symphony Presenting some of the very greatest musicians performing in the world today, including Yuja Vvang, Imogen Cooper, Al￿ Sara Ott, Tan Dun, Sheku Kanneh-mason, Nicola Benedetti, Evelyn Glennie, Roderick Williams, Milsuko U¢hida and Bryn Terfel Welcoming 27,/0 firsl-time audiences lo the opening weekend of our new classical season. Grace Jones, Meltdown was nominated for Festival of the Year Imusic Week Awards 20231 and was the second most successful Meltdown festival in terms of audience numbers and revenue. Other contemporary music headliners included I￿0 exclusive London dales from Erykah Badu. Hayward Gallery exhibitions in 2022123 included In the Black Fantastic. an exhibition of 11 contemporary artists from the African diaspora, who draw on science fiction, myth and Afrofulurism., Strange Clay. Ceramics in Contemporary Art.. the first large-scale group exhibition in the UK lo explore how contemporary artists are reinventing the possibilities of ramics,. and Mike Nelson.. Extinction Beckons.. the first major surveyor the artist's large- scale immersive installations and sculptural works. Outdoor commissions in 2022123 were Jyll Bradley, The Hop.. A luminous public pavilion growing from the side of the Hayward Gallery,. and Monira Al Qadiri, Devonian.. mesmerising outdoor sculpture, the second Bagri Foundation Commission. Hayward Touring produced Hollow Earth.. Art, Caves and The Subterranean Imaginary al Nottingham Contemporary and British Art Show 9 which opened in its final I￿0 cities in 2022123, Manchester in May and in Plymouth in October 2022. REFRAME.. In September, Apple expanded ils Racial Equity and Justice Initiative into the UK for the first lime through a groundbreaking partnership with Soulhbank Centre lo support young Black creatives in London, Bimiingham and Manchester. Hosting flagship spoken word events with Greta Thunbery, Michaela Coel, Bernie Sanders, Edward Enninful, Bret Easton Ellis and lan McEwan. One of the Most successful ever Imagine Children's Festivals, with over 17,000 tickets sold and 100 events programmed. "How cool that one of London's greatest annual arts festivals is for an audience half of which are scarcely out of training pants" 'genuinely brilliant" (Time Oull. Ai Weiwei's curation of the 60th anniversary of Koesller Arts, the ambitious Southbank Centre exhibition of art by people in the justice system. Welcoming the celebrated and world-leading Aurora Orchestra and Chineke1 to our group of Resident Orchestras. Inlernational-class awards ceremonies for the BAFTA for the Film, TV and Video Games sectors. A celebration of the Queen's Platinum Jubilee that included a large scale lea party for hundreds of elderly residents form our local community and events curated with Danny Boyle focLJssing on the culture of 1977, including the explosive rise of punk. Slava Ukraini, a fundraising concert in solidarity with Ukraine and London's Ukrainian commLJnity featLJring leading Ukrainian and British artists including Ben Whishaw and Jonathan Price. 'New Future, plan for Classical Music based on innovation, diversity, inclusivity and excellence, lo ensure ¢lassi¢al music remains relevant and can respond to and reflect our rapidly changing society. 'New Future, is driving in-house programming focussed on artist development and audience representation and is refreshing the classical repertoire. Southbank Centre remained open all night during the extraordinary period of National Mourning, providing warm spaces, cafe and facilities for those queuing for Her Majesty The Queen's Lying-in-slate at the Palace of Westminsler. We screened HM The Queen's funeral to audiences in the Queen Elizabeth Hall. CHARITABLE IMPACT IN NUMBERS 2022123 2021122 Venue visitors 3,055,000 1,342,000 Tickets Issued 761,000 484,000 Events 4,613 3,616 'A free publlc events 550/0 of public events or exhibition days Schools engaged 305 school groups engaged in person with a total of 4,600 children and 658 teachers 164 teachers engaged with us through digital events from 160 schools 55 school groups engaged in person with a total of 1,920 children 162 school groups engaged with us through digital events Regional Audiences for Hayward Touring 420,000 62,000 Black, Asian and Ethnically Diverse audiences 14Qkn (post show surveys) 14Yo Lambeth and Southwark bookers 12¥0 12Yo Review of Activity and Future Plans 2021122 saw Southbank Centre's proposed Strategic Principles fomially adopted by the Board, and then cascaded through the organisation. These principles which align with the Arts Council's Investment Principles underpin all art form and departmentsl strategies to enable us lo achieve our purpose and vision. In 2023124 we will also deliver activity in support of ACE'S strategic outcomes, sel out in Let's Create. We'll present an artistic programme that both features world class performances and artists. More diverse, global majority artists will create and present new work and more collaborative curatorial approaches will connect audiences with themes across art-forms and the entire Soulhbank estate. We'll also help grow the creative lalenl of the future through skills and training programmes and by establishing the Pur￿11 Rooms (Southbank Sludiol as a key artist development space. Whilst we necessarily deliver the majority of our cultural programme on our Soulhbank Centre site, we also present and develop work in the London Boroughs of Soulhwark. Croydon and Lewisham and in Birmingham, Manchester, Newcastle, South Tyneside. South Lakeland, Sunderland, Norwich. King s Lynn and West Norfolk, Coventry, Bristol and Exeter, alongside tours lo East Asia and the Pacific, and North America. Much of our work will be accessible to global audiences online. OUR STRATEGIC PRINCIPLES INNOVATION AND DYNAMISM We innovate all thg time. in all that we do, in all our spaces, physical and digital. We are dynamic and Ilexibl8 in the way w8 fac& challenges of th& futur8. W& strive for excellence in ev&rything we do. Our newly formatted Soulhbank Centre Studio was announced in January 2023 to continue the Purcell Sessions programme and to provide emerging artists with valuable space to workshop and develop their practice. Our bold summer site-wide programme was developed in response lo our 5-stsr Hayward Gallery exhibition In the Black Fantastic which was curated by Ekow Eshun and featured artists Nick Cave, Sedrick Chisom, Ellen Gallagher, Hew Locke, Wangechi Mulu, Rashaad Newsome, CHris Ofili, Tabila Rezaire, Cauleen Smith, Lina Iris Viktor and Kara Walker. Our popular free, open-air sile installation and exhibition Winter Lights ran from 10 November 10 8 January, featuring 11 Iow-energy LED light works from ten internationally acclaimed contemporary artists. We secured funding from Bloomberg Philanthropies, Digital Accelerator to enhance our digital infrastructure in two interconnected areas, website redevelopment and to provide new editing and broadcasting facilities. A new 2023 Climale-focussed season Planet Summer was developed across the year, and new partnerships were forged that bring expertise lo our ongoing work on sustainability, including with ZSL London Zoo. An assessment of the carbon footprint of our Hayward Gallery exhibitions began with Strange Clay (October 22 - January 231. We are now capturing Scope 1-3 carbon emissions using the Gallery Climate Coalitions carbon footprint calculator. This includes logistics of artwork, loans and curatorlartist travel. COLLABORATION Partners and Artists are critical to our Suc￿sS and ￿ntral to our way of working. Artisticllech/ con7mercial and cross-seGlorpartnerships as well as GommunNty and venue partnerships across the UK and the worfd. Our In The Black Fantastic events were co-curated with artists, grassroots and community organisations, including Brownlon Abbey and SX WKS collective. As part of London Literature Festival we hosted the inaugural announcement of the Poet Laureate for Lambeth in collaboration with Lambeth Council. io The addition of both Aurora Orchestra and Chinekel marked the first change in our Resident Orchestras roster since 1992. Both orchestras joined the London Philharmonic Orchestra, the London Sinfonietta. Orchestra of the Age of Enlighlenmenl and Philharmonia Orchestra to form a new cohort of six Resident Orchestras. We received transformational investment from Apple for our programme for emerging Black and mixed black heritage creatives. We established key creative engagement partnerships in with The Factory In Manchester and STEAMhouse in Birmingham. AUDIENCES AND PEOPLE Democratic access for all is our founding and ourguiding principle. We are always extending our reach and ￿leVan￿. We launched the refresh of our Purpose and Vision. We expanded our staff networks (including BAED, Proud and Wellbeing), with a programme of events to platform the networks and build awareness and opportunities for community- building. We published our sixth Gender Pay Gap Report and our Second Ethnicity Pay Gap Report. From April 2022 - March 2023 we hired 129 FTE new members of staff which by March 2023 made up 28,10 of a total staff of 463. 22.2.10 Staff were Black, Asian or Ethnically diverse staff compared lo 21,10 pre-COVID. 7. 1°/0 staff declared a disability with 3,￿ Identifying as neurodivergenl. LGBTQl+ representation was al 16.9°/o. Gender split was 36.5°/o male, 54.40/. female with 7.34D/D of staff identifying as non-binary. 27.20/D of staff were below the age of 30. We have engaged in partnerships with Tickets for Good to provide tickets for NHS, charity workerslvolunleerslservice users by arrangement, and cosl-of-living recipients, and the new Ticket Bank scheme. We Increased the number of free public eventslexhibilion days we provide lfrom 44.￿ lo 55,10) including on our outdoor stage. Using the ACE Impact and Insights Toolkit, a variety of evaluations look place throughout the year (including peer assessmenlsl, with the results shared with our Executive Leadership Team as well as programming Heads. RESILIENCE AND SUSTAINABILITY We are resilient 8nd our org8ni$8tion is st8ble. We m8ke agile use of our resources so th81 we c8n invest for the long leml future of Southbank Centre. We 8re environmentally responsible in everything we do. A business plan was developed lo lake into account the result of the reduced NPO grant award ensLJring that investment and innovation funding was preserved. We have allocated £2m to invest in artistic. digital, suslainabilily. skills and new income generating initiatives. We secured an additional £3m of commercial income and opened a new restaurant beneath the Royal festival Hall, La Gamba. A new Director of Development was appointed in June 2022 with a remit to increase Southbank Centre's fundraised income and ensure we are realising the potential of our programmes and our site lo secure high value sponsorships, grants and major gifts. We have resel our target to reduce carbon emissions of our buildings to nel zero by 2035 Iscope 1 and 21 and 2040 (all scopes). We began work in developing a list of essential works and a plan for their initiation without closing the Royal Festival Hall. We have also begun lo formulate the vision for the redevelopment.. more public spaces, re-orientation lo optimise access, net zero carbon impact, and have undertaken early work with archilecls to better understand the funding model for capex investment longer-lerm. For our sustainability and energy reporting please refer to the Environmental Reporting section below. li FORWARD LOOK Our objectives in 2023 will include further investment in a refreshed public realm with interactive and free programming, including new activity on the Clore Ballroom. We will embed innovation and sustainability within our Phase 1 RFH project, which will begin in late 2023 and include a new catering offer on level 2, 5 and 6 of the Royal Festival Hall. We will reshape existing partnerships lo deliver NPO outcomes as well as expanding into other artfomis in line with our new artistic vision. In 2025 we will partner with Bradford for their 2025 City of Culture year. We will work lo develop, share and embed new values across the organisation. We will pilot a new technical academy which will seek lo develop pathways for under-represented groups into tech based roles and grow key audiences in line with NPO funding targets. We will continue to navigate financial and economic challenges that flow from reduced Arts Council annual funding, along with a challenging inflationary environment. We will deliver our challenging targets in development funding and develop new opportunities lo grow our earned income. ENVIRONMENTAL REPORTING Streamlined Energy 8nd C8rt)on Reporting (SECR) Summary Report for Southbank Centre The UK government's Streamlined Energy and Carbon Reporting ISECRI policy was implemented on 1 April 2019, when the Companies (Directors, Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018 came into foree. SBC have opted to use the Operational Control boundary definition to define their carbon footprint boundary. The reporting period for the compliance is 1st April 2022 - 31 sl March 2023. Included within that boundary are Scope 1 & 2 emissions, as well as Scope 3 emissions from gas, electricity, company fleet and grey fleet in the UK. The GHG Protocol Corpofftte Accounting & Reporting Standard and UK Government's GHG Conversion Factors for Company Reporting have been used as part of carbon emissions calculation. The results show that SBC lotsl energy use and total gross Greenhouse Gas IGHGI emissions amounted to 17,278,952 kwh and 3,229 lonnes of C02e respectively in the 2023 financial year in the UK. In their 2023 financial year, SBC procured 1000/0 renewable electricity. As a result, their Scope 2 Market Based. emissions dropped by 1,323 IC02e. SBC have chosen 'Tonnes of C02e per million turnover Im£l' and as an intensity metric as this is an appropriate metric for the business. The intensity metric for the financial year 2023 was 60.8 tC02elm£ compared to 143.3C02elm£ in 2023. Below is the energy consumption and GHG emissions summary table as well as the table outlining the year on year analysis 12 Type of Emission5 Activity kwh tco % of Totsl Direct Iscope 11 Natural Gas 10,405,263 1,899 58.8% Company Fleot 0.00° LPG 34,099 Subtotal 10.439,362 1.906 59.0% Indirect ISGope 21 ElectriGity 6,839,590 1,333 41.0% Subtotal 6,839,690 1,333 41.0% Indirect Other Iscope 31 Grey Fleet 0.00% Subtotal o.ooY. T¢>tal Energy Use Ikwhl 17,278.952 Totsl ILocation-basedl Gros5 Emissions Itcoyel 3,229 Rer￿lable Electrlclty ItCO,el 1,323 T¢>tal IMarket.basedl Gross Emissions IICO* 1,907 Gross Turnover Im£) 53.1 Tonnes of Gross C02e per m£ 80.8 The Soulhbank Centre is committed to energy reduction and has had ISO 50001 since July 2017 they have refurbished both The Queen Elizabeth Hall & Hayward Gallery in recent years and installed low energy systems like LED Lighting,. Daylight Sensing blinds etc. has reduced ils overall energy consumption by around 4.50/0 per year for 3 years. Within 202212023, the Soulhbank Centre completed the following.. Inslallalion of HG Chiller LED Lighting Upgrade in the Office Building and Longside Gallery BMS Upgrade from Honeywell lo ALC BMS Time Schedule Modifications Sno. Lift Modernisation It is expected that 750,963 kwh of energy is going to be saved over the next 5 years through these energy efficiency measures. 13 Type of Emission5 Units 202212023 202112022 YOY Yo Change Direct Iscope 11 Ikwhl 10,439,362 11,412,072 -8.50 ItCO*l 1,907 2.0gB -9.1% IndI￿t (Scope 21 Ikwhl 6,839,590 8,509.669 -19.6% ItCO* 1,333 1.807 -26.8Vo IndireGt Other ISGope 31 Ikwhl ItCO*l Totsl Energy Use Ikwhl 17,278,952 19,921,741 -13.30 Total Gross Eml881ons ItCO,el 3,230 3.905 -17.30 Renewable Electrlclty ItCO,el 1,323 1.807 -26.8¥o Totsl Net Emissions ItCOEI 1,907 2.098 -9.10 Tonne8 of Gross C028 p8r £m 60.8 143.3 -57.60 "In SECR rÈporting the￿ a￿ Iwo ffèporting èppmachès." lttation-based'and inark&l-based' Location based ￿pOrtIng IS Éhè andatory nieihod and uses giTdaverage figurps18 rnix ofrpnewable and non*new8ble fuels). A morkÈl-based ￿pOrting approach can b8 uséd whén comp8ni8s h8v8 ent8f6dift>to contr8Ctuèl89re8ments forfftn8w&b16 &leCtr￿ty(8.y REGO&l Reportiny on renèwablÉ anergyandassottièled ÈMISS￿￿$ is nol a mandatroryffèquitsmènl under the SECR legislatiOff> bul il Is possiblé forooaniÈétions to use dual reporting if Ihey wish Èo ￿N&t1 ÈhairconsumplN)n oftsnew8blÈ énergy In this SECR è du81 ￿portIng approach has b88n uséd lo tak8 8ccotsnl fforboth location b*Èed and Ma￿81 based reporting We have a target lo reduce carbon emissions of our buildings by 500/9 by 2025 and have so far achieved a 420/0 reduction. We aim to reduce emissions by 800/0 by 2030. The largels for nel zero have been set al 2035 Iscope 1 and 21 and 2040 (all scopes). We have appointed Buro Happold to help devise a decarbonisation strategy lo achieve this Ilhis will include plans to switch lo allernalive healing sources and assess existing plantl. We are also tackling large energy using aspects of our buildings, such as swlching all lighting lo LED. A Sustainability Advisor was appointed in October 2022 to lead on environmental projects and help to embed sustainability throughout the organisalion's operations, planning and culture. The Southbank Centre aims lo become a single-use plastic free site by 2025. Work has ComMen￿d with regards to this, with all coffee cups and lids, cutlery, barware and other elements being switched lo composlables. We have appointed ecology consultants at Arup to devise a Nature Based Strategy for the site. 14 FINANCIAL REVIEW Our financial results demonstrate the significant increase in activity across sile as we emerged from closure due lo COVID and were able lo deliver the first full programme of artistic activity across Soulhbank Centre since 2019. This was also the first year of the full implementation of our revised 5- day operating model. The overall result was in line with our expectations with revenue increasing by £1 Om lo £53m12022 £43ml and our cost base lo £53.9m12022 - £42.5ml, both reflecting the growth of free and lickeled activity and visitor numbers across the sile. Our Group free reseNe level of £5.6m is in accordance with our reserves policy lo provide for exceptional contingencies not covered in our operating budget. Other reserves provide for an investment of £2m per annum into funding agreed innovative strategic and artistic projects and capital works. The Charity free reserve level is in a deficit of £835k and will be supplemented by the £6.4m Gift Aid payment approved by the Board of SCEL, to be made in July 2023. Income Total revenue increased by £1 Om lo £52m12022 - £43ml reflecting the increase in the number of visitors to Southbank Centre from 1.3m lo 3.1 m, artistic events from 3,600 to 4,055113 /ol and paid ticket sales Increasing from 484,000 to 739,0001520/DI. Ticket revenue increased lo £10.4m. Overall ticket revenue per event is now at or exceeding or pre- pandemic levels although traditional elassical audiences have been slower to return. Donation and membership income increased by £1.5m to £4.7m including support from Apple to support Reframe and Bloomberg for digital innovation projects at Southbank Centre. Commercial income increased to £1 S.7m12022 - £12.7ml. Concession and lease income increased to £10.8m 12022 - £7.2ml due to the higher audiences and visitor numbers. Retail income grew, to £1.7ml as a result of the increased visitors and the successful sales linked to Hayward Gallery exhibitions. Commercial events increased to £3.2m12022 _ 250/0 to £2.5ml due to an increased number of events, including the first BAFTA film and craft awards at the Royal Festival Hall in February 2023, joining the BAFTA TV and BAFTA Games awards at Soulhbank Centre. Expenditure Total expenditure increased to £53m {2022 - £42ml lo Servi￿ the increased activity across Soulhbank Centre of which £45m12022 £35ml is directly attributable to our charitable activities. Our payroll costs increased to £17. 1 m12022 - £13.4ml as we returned to a complete staff complement12023- 349, 2022 - 2911 predominantly within our vi511or experience department. The core operating costs of running and maintaining the Royal Festival Hall, The Queen Elizabeth Hall, the Purcell Room and the Hayward Gallery together with the 11 acre site, including payroll, increased lo £18.3m12022 - £15.1 ml, excluding depreciation and capital investment. Although we have emerged from the pandemic, signifieant financial challenges remain. Whilst we were re-confirmed as an ACE National Portfolio organisation, our funding was reduced by £1.9m per annum due lo ACE responding to the requirement to transfer grants outside of London. As a result we reviewed our future activity levels that, together with efficiency savings, has allowed us to plan a break even budget. As we go forward a key concern is the level and variability of energy costs and the impact of inflation more widely. 15 Energy costs are a significant element of our cost base and whilst we are shielded until the Autumn of 2023 when our current contract ends, there will be a significant increase in the region of £1.8m per annum. These increases have been factored into our operational budgets. The underlying level of inflation remains challenging on two fronts. Due to the fixed nature of the ACE grant until 2026 we are required lo create new income streams or achieve significant operational savings and efficiencies each year to maintain activity and the ambition of the artistic programme even on the assumption that we are able lo increase all existing revenue streams in line with inflation. This will potentially be compounded by the impact of the economic environment and cost of living pressures on demand. Whilst this has not been seen significantly lo dale, we are conscious of the impact on our revenue streams of reduced consumer income and are closely monitoring sales levels for any impact. We are taking this into account when considering the required contingency levels in forward budgeting and free reserve levels. Balance Sheet The balan￿ sheet remains broadly comparable lo the prior years with the exception of the transfer of the Lloyds loan lo balan￿S due within one year as il is repayable in January 2024. Provision for a full repayment has been made within designated funds and future cash flows. The Pension Scheme is in surplus based on the valuation carried out under Section 28 of FRS 102 of £6.7m12022 - £11.Oml but as the surplus is not recoverable by Southbank Centre until the pension scheme has been wound up no asset has been recognised on the balance sheet. Whilst the surplus reduced by £4.3m during the year on this basis, an estimated position on the current technical provisions basis specific to the scheme suggests an increase in surplus during the year. A triennial valuation of the scheme is due as at 31 March 2023 and the extent of any technical provisions surplus will not be known until these results are finalised Reserves Our total reserve levels have increased by £472k in the year and total £229m. The overall reserve requirements have been reviewed during the year and we seek lo maintain a minimum level of £5.6m for exceptional operational risks not covered by the budget contingency, and lo provide us the ability to make the operational adjustments and investments required by new operating environments. We have maintained our Strategic Investment Fund with the intention of allocating £2m per annum lo innovative artistic and strategic projects. Plans for 2023124 include investment in Dear Earth, our summer climate festival, support of an international season of performance and dance, a sound project ulilising the voids of the Queen Elizabeth Hall and a technical academy to provide opportunities for training in theatrical and event production lin conjunction with other cultural organisalionsl. We plan to spend £2m per annum from this fund with it being replenished each year from operational surplus. We are very cognizanl of our responsibility lo maintain and develop the Southbank Centre estate lo ensure the iconic buildings remain lit for purpose in the 21st Century whilst preserving their rich archileclural heritsge. Our capital investment budgets have therefore been increased to enable us to maintain the buildings and the funding from the Cultural Recovery Fund repayable finance has been designated for future capital investment. £11 m of additional funds have been designated within the Capital Reserve for spend in 2023- 2025 for core refurbishment proje¢ls. Significant additional funds will be required lo provide Improvements, including those to achieve our net-zero ambitions and expand the artistic, community and commercial provision on the site. Reserves Policy The charity's reserves fall into two main categories". restricted funds which may legally be used only for the purposes specified by the donor, and unrestricted funds which are free for use for any of the purposes of the Charity as set out in the governing document. Total funds held at 31 March 2023 are £228.7m12022 £228.2ml made up of Unrestricted funds of £226.6m12022 - £227.2ml and Restricted funds of £2.1m12022 - £1 ml. 16 Unrestricted reserves Within unrestricted reserves there are both General and Designated reserves. Designated reserves are funds that the Governors have set aside lo reflect particular intentions for the use of those funds. Unrestricted funds not designated in this way are in the General Reserve. The General Reserve is available for any charitable purpose and is not earmarked for reinvestment in any specific area. At 31 March 2023 the Group held General Reserves of £5.6m and Designated funds of £221.0m. Planned level of unrestricted reserves The Charity budgets lo deliver ils charitable objectives while ensuring financial stability through aiming to keep adequate, but not excessive, levels of unreslricled reserves. 11 makes this assessment by looking at future cash requirements and setting annual budgets which ensure adequate cash liquidity taking into account the availability of headroom on financial facilities, expected cash inflows and suitable levels of contingency based on an assessment of operational risk. The Board has reviewed ils Reserves Policy in the light of the post pandemic trading, current financial challenges and risks and considers reserves of approximately £5.1 m will provide sufficient financial resilience for the organisation al this lime. On 31 March 2023 the balance of General Reserves is £5.6m 12022.. £7.9ml which is equivalent lo 8 weeks of turnover excluding confirmed ACE grant income. Designated Reserves As of 31 March 2023 Southbank Centre held three designated reserves.. lil Capital and Revaluation Reserve1£211.6ml The purpose of this reserve is to reflect funds expended on capital assets net of accumulated depreciation, including the balance of surplus or deficit from the revaluation of Land and Buildings, 1£197.gml and funds designated for future capital projects1£13.7ml. Funds expended on fixed assets could only be realised on sale of those assets and are subject to the restrictions noted in note 25. lill Strategic Investment Fund1£3.5ml The Strategic Investment Fund has been created to provide investment lo support and promote artistic ambition, innovation, inclusion, suslainabilily and financial resilience. These funds have been allocated to projects in 20231241£3ml and 20241251£0.5ml. lill Loan Repayment Reserve1£5.89ml The purpose of this reserve is to designate an amount to repay the loan and interest rate swap agreement provided by Lloyds Bank plc. Restricted Reserves As of 31 March 2023 Soulhbank Centre held £2.1 m of restricted income received in advan￿ of expenditure for operating projects in a Projects Fund. Going Concern The Governors are required to consider whether the Southbank Centre has sufficient current and forecast cash resour￿5 to cover the working capital requirements ofthe company for al least 12 months from the dale of signing this report and financial statements. The key financial risk lo Southbank Centre is considered lo be the impact of inflation on the organisalion through any reduction in demand due to the increases in cost of living on our visitors or our artistic and commercial partners and the impact on the cost base, in particular the level and variability of energy costs The Charity has therefore modelled various scenarios in order to assess the impact of variability in demand or increases in Ils cost base. Given the level of reserves and cash holdings the Board considers that there are sufficient resources available lo the Charity to sustain the operation in all likely scenarios and the Charity will be able meet all the requirements of our loans and obligations under ourACE NPO Funding Agreement. We continue to monitor and take necessary actions to ensure that we maintain an appropriate reserve and cash levels in order to operate. Having tsken these factors into account the Board of Governors has a reasonable expectation that Soulhbank Centre has adequate resources lo continue operating for the foreseeable future being al 17 least twelve months from the dale of approval of these financial statements and, for this reason, have prepared the financial statements on a going concem basis. Funding Agreement Soulhbank Centre is one of Arts Council England's National Portfolio Organisations and is funded via a funding agreement. Southbank Centre has been confirmed as a National Portfolio Organisalion for the three year period commencing 1 April 2023. Soulhbank Centre is subject to the normal monitoring processes and annual reviews for National Portfolio Organisations. The Funding Agreement with Arts Council England requires Soulhbank Centre lo provide regular financial and non-financial data lo Arts Council England for monitoring Southbank Centre's artistic aclivilies, commercial progress and financial position. Arts Council England also receives copies of all advanTr publicity material for events at Southbank Centre and is invited to attend Soulhbank Cenlre's board meetings. Risk Management The Governors regularly examine the major strategic, business and operational risks which the charity faces, identifying the potential impact if an Individual risk materialises, and what miligaling action is to be taken in order to reduce each risk lo a level which the Governors consider to be acceptable. Twice annually, Governors review the Risk Register prepared by management lo ensure that Il is comprehensive and to assess actions to mitigate those risks. The following are the major risks identified that are specific lo Soulhbank Centre.. ReputalNon Soulhbank Centre presents a world class range of activity across the sile. Damage to the Soulhbank Centre's reputation either through reduction in artistic quality or the ability lo provide a venue of excellence has the potential to impact the ability to attract artists and audiences to the site and a consequential impact on the ability to meet charitable objectives, obtain funding and generate audience and commercial income. This risk is Managed by having a process in place to review and approve both Southbank managed and third party events held on sile and working closely with our resident orchestras Our property and commercial strategies are reviewed quarterly by the Property, Commercial and Sustainability committee of the Board. All strategies and business plans are discussed with Arts Council England at regular monitoring meetings. Equality, Diversity and Inclusion The Southbank Cenlre's ability lo achieve its strategic ambitions is dependent on being a diverse, inclusive, welcoming and vibrant organisation and ensuring the artistic programme presents a diverse range of artists to an audien￿ that is representative of London. In order lo manage this risk the Soulhbank Centre has developed a range of key performance indicators lo measure the diversity of our artistic programme and Is implementing a wide ranging Equality, Diversity and Inclusion strategy. Both are regularly reviewed al Board level. FNnancial Resilience The Southbank Centre obtains revenue from audiences, artistic hires and commercial activity as well as from Arts Council England. These income streams are subject to variation due to the widereconomic environment and Government policy. The current inflationary environment and the increases in, and volatility of, energy prices present signifi'cant challenges for the charity due to the level of fixed revenue lincluding ACE funding and commercial lease income) and the potential impact on audience levels and other trading income. Financial risk is mitigated through a reserves policy which is reviewed and approved by the Board as well as an annual budget setting process. Forecasts are prepared regularly to inform mitigating actions. The financial assumptions used for future years are regularly assessed and plans updated to take into account changed expectstions. 18 Safeguarding The Southbank Centre welcomes all to its venues, sile and online platforms and provides services in schools and to other partners in London and the UK. A key risk is the safeguarding of children and vulnerable adults. Safeguarding risks are managed through a Safeguarding Committee that meets regularly. Specific training is provided to all members of the Committee DBS checks and safeguarding training is provided lo all staff who come into regular contact with children and vulnerable adults. Processes and procedures are reviewed by an external specialist. A Board member is a Safeguarding Governor and an annual safeguarding report is made to the Board. Health and Safety The Southbank Centre operates on a 11 acre sile with over 3m visitors lo the site and 4,500 artistic and commercial events per annum. The ability to ensure the safely of all or visitors, staff and artists can be compromised through a lerrorisl incident, fire, failure of equipment, tenant activities and public order incidents and could have legal, repulalional and financial ramifications. These risks are managed by having comprehensive Health and Safely and Counter Terrorism processes including training, investigation and regular reporting lo the Finance Audit and Risk committee near misses and incidents, and audits of our Counter Terrorism procedures. D8ta Soulhbank Centre operates in a digital environment and accordingly faces increased risks concerning cyber-security and the correct handling of information. Soulhbank Centre maintains a robust data management policy including annual departmental data retention reviews and training for all staff. Data management is monitored through regular meetings of key internal stakeholders. Publlc beneflt The Governors confirm that they have referred lo the information contsined in the Charity Commission's general guidance on public benefit, including the guidance on public benefit and fee charging, when reviewing Southbank Cenlre's aims and objectives and planning future activities. Soulhbank Centre relies mainly on Arts Council England revenue gonl, income generated from commercial activities, fundraising and box office income lo cover its operating costs. When determining ticket prices, careful consideotion is given lo ensuring accessibility of Southbank Centre's artistic activity to those on low income. Soulhbank Centre provides a wide range of artistic activity aiming lo ensure that 379/0 of the artistic programme is free to ensure everyone has the opportunity to experience events, as well as enjoying Southbank Centre's 17 acre sile along the South Bank. Further details are given above under Achievements and Performance. Employee Policies The Governors recognise that Soulhbank Centre's success and position in the arts depends on the quality and motivation of ils employees and Southbank Centre is committed lo policies which support and improve allraclion, development, performan￿ and retention of staff al different points in their employee journey. From 1 May 2022 we have revised our pension arrangements to ensure equity across all staff. For staff earning below £16,620 per annum the Southbank Centre makes a contribution of 5'/o wilhoul requiring any ¢onlribulion from the employee. This is designed to enable all our staff to take advantage of our pension arrangements from day 1 of employment. We are members of the London Living Wage Foundation and staff are paid the London Living Wage as a minimum and automatically receive an increase in line with this each year. The most recent London Living Wage uplift was implemented from 1 January 2023. We continue lo benchmark salaries with other cultural organisalions whenever roles are vacant and have recently launched an Annual Sector- Specific independent salary benchmarking project to support more relevant benchmarking across salaries and benefits for similar sized organisations. Engaging and impactful communications are particulady important and it is the Governors, policy to promote the understanding by, and the involvement of all employees in Southbank Cenlre's aims and perfomance of all ils activities. This is achieved through our 6-weekly All Staff Meetings, weekly intemal 19 communications downloads which give regular updates on Southbank Cenlre's performance and major developments, celebotes Soulhbank Centre's successes and reflects our Culture. In addition all of Soulhbank Cenlre's Policies and Producers are housed on an Intranet sile, which is under the process of improvement and re-design lo ensure information is accessible and available in different formats including policies, briefings, guidelines and videos. Soulhbank Centre participates in the Joint Negotiating and Consultative Committee with ils trade unions, Unite (Amicus section} and PCS. Pay negotiations are conducted within this Committee for all stsff. Improved union relations have been invested in, with additional monthly meetings to ensure transparency and taking a joint partnership approach. The Southbank Centre is striving lo promote equity, diversity and inclusion in all areas of employment including recruilmenl and selection, development, and progression. The Soulhbank Centre is engaged with a number of diversity initiatives and partnerships in order lo achieve these aims. In line with our commitment to being an organisalion where everyone is welcome and able lo thrive, we have reported our Gender Pay Gap for the 6th lime and our Elhnicily Pay Gap for the 2nd lime. We have invested in membership with The Business Disability Forum, a four-part Anti-racism course for all staff (both available in hybrid and in person) and regular Learning Lunches on a broad range of topics such as Trans Awareness. Social Mobility and the Menopause, as well as Inviting our Employee Assistance Programme providers and Pension Provider in lo promote these benefits to staff. We are also commilled to ensuring our recruitment process is inclusive and accessible,. providing targele recruitment campaigns to reach the broadest range of candidates and communities, offering reasonable adjustment such as sharing intetview questions in advance, having standardised competency-based questions and scoring, alongside ensuring blind screening is in place to reduce bias In March 2023 the Menopause Policy was also launched as part of creating an inclusive working environment for our female, trans and non-binary colleagues. In October 2022, the Governors approved revised Safeguarding Children, Safeguarding Adults at Risk, Digitsl Safeguarding Guidelines and Code of Conduct, which are also available externally on our website as well as intemally for stsff. Pay policy for key management personnel The People Committee membership is made up of a minimum of three Governors of Southbank Centre who meet al least three times a year lo consider the following matters.. To recommend to the Board the remuneration and particular employment terms of the Chief Executive. To review the Chief Executive's proposals for the conlraclual arrangements and remuneration of the Executive Leadership team. Annually. lo consider the Southbank Centre reward strategy of all staff to ensure the approach is fair. robust. equitable and defensible and lakes into account best practice in other relevant arts organisalions. The People Committee assesses the annual perf0rrnan￿ of the Chief Executive and agreed members of the Executive Leadership team against organisalional and individual objectives. The remuneration and employment terms of the Chief Executive and the Executive Leadership Team is reviewed in the context of the overall remuneration and employment terms and practices for all Soulhbank Centre employees and key subconlraclors and In the context of payroll trends within the cultural sector and beyond. It was a condition of the CRF Repayable Finance scheme that the Charity operates pay reslrainl until al least September 2022. Beyond this requirement the Chief Executive and Chief Operating Officer have continued lo take a voluntary reduction in pay based on pre-COVID salaries respectively in the year lo 31 March 2023. Further details on the charity's Governors, senior staff and professional advisors are sel out on pages 2-3 of these financial statements. 20 Legal Framework Soulhbank Centre is a registered charitable trust with a single corporate trustee, Soulhbank Centre Limited, a company limited by guarantee. Soulhbank Centre was formed by a deed of trust on 31 March 1988. It's main objects are.. 1. The promotion of the arts for the general benefit of the public and in particular the maintenance and development of the Soulhbank estate as a centre for the arts for the benefit of the people in Great Britain in general and London in particular. 2. The development and improvement of the knowledge, understanding and practi￿ of the arts at the Southbank estste or any part of it. 3. The provision and support of such cultural activities related to the arts as the trustees consider desirable al the Southbank estate or any part of it. There have not been any changes to il objects during the year. As trustee of Southbank Centre, Soulhbank Centre Limited has power lo revoke or vary any or all of the provisions of the deed of trust, subject lo the consent of the Department for Culture, Media and Sport lafter consultation with Arts Council England), with the exception of the charitable objects of the trust and the clause requiring ministerial consent, provided that the alleralions would not have the effect of causing the trust lo cease to be exclusively charitable under the laws of England and Wales. Southbank Centre Limited has three wholly owned subsidiaries which it holds on behalf of Southbank Centre. The South Bank Foundation Limited is a dormant registered charity and company limited by guarantee. The Charity Commission issued a uniting direction for registration purposes for Southbank Centre (charity 2989091 and South Bank Foundation Limited (charity 10541051 in October 2004. Soulhbank Centre Enterprises Limited manages certain commercial activities on the Soulhbank estate. The results of Southbank Centre Enterprises Limited are consolidated on a line-by-line basis with those of Southbank Centre. See note 24 for details of Soulhbank Centre Enterprises Limited's results. Southbank Centre Pension Fund Corporate Trustee Limited acts as the Corporate Trustee of the Southbank Centre Retirement Plan and is otherwise dormant. Governance The Board of Governors, who are directors of Soulhbank Centre Limited Ilhe sole corporate Irusteel, are not remunerated for their services and have delegated management of Soulhbank Centre's operational affairs lo a Chief Executive and an Executive Leadership Team who attend Board meetings but are not entitled lo vote. The Board's effectiveness is internally monitored and considered each year including the skills required and size of the Board taking into account future retirements. New Governors are appointed under selection criteria that ensure the Board maintains a broad range of skills and relevant experien￿. A Governor is appointed after agreeing to become a Member of the Board, after the Secretary lo the Board has received written approval from the Secretary of Slate for Culture, Media and Sport for his or her admission as a Member, and after his or her name has been entered in the Register of Members. Govemor's appointed after 1 January 2018 usually serve for a period of three years from the Annual General Meeting following the date of their appointment, and may be reapF)ointed for two further periods of three each, subject lo a maximum tenure of 9 years as a Governor. Three Governors were appointed prior to 1 January 2018 and are available for reappointment for an additional three year period, which if approved will result in these Governors serving for a maximum of 12 years. An induction programme is offered lo all new Governors in order to ensure that they are briefed on the charity's objectives, strategy and activities. The Governors meet six times a year on a regular basis, but may meet more f￿qUentlY if required. The Board of Governors relain decision-making over certain matters, including the approval of strategic plans and major projects, remuneration matters of the Chief Executive and variations to governing 21 documents. The Board currently has six sub-committees lo assist its govemance of Soulhbank Centre.. Finance, Audit and Risk", People", Nominations", Development., Property, Commercial and Sustsinability and Brand, Audience, Reach and Impact Committee. The Board supports the principles of good governance as set out in the Charity Governance Code for larger charities and also the continuous improvement model which the Code promotes. As part of ils forward succession planning the Board has prepared a diversity plan linked to the skills needed to support the Executive Leadership Team in delivering a new strategic business plan. An open and transparent method of recruitment is in place to fill vacancies on the Board. The Board has also widened and strengthened the Terms of Reference of the Nominations Committee both lo oversee the changes in Governance practice but also ensure continuous improvement and the People Committee which now oversees EDI policies and practice. Internal Financial Control The Board of Governors has overall responsibility for Southbank Cenlre's system of internal financial control. The Governors are supported in their monitoring role by the Board's Finance Audit and Risk Committee, whose members are all non-executive. The Committee reviews the effectiveness of Soulhbank Cenlre's internal financial control environment and receives reports from the external and internal auditors on a regular basis. Both auditors have the right lo call a meeting of the Committee and both have direct access lo Ils Chair. The Governors have delegated implementation of the system of internal financial control at Southbank Centre to senior staff. The system is based on a framework of regular management information, financial regulations, administrative procedures for segregation of duties, and a system of delegation and accountability, including". Comprehensive annual budgets Monthly results reported against budget, and with year-end forecasts prepared on a regular basis Targets sel to measure financial and other performance Clearly defined capital expenditure control guidelines. Internal audit work is completed in line with an analysis of the risks to which Southbank Centre is exposed. Internal audit plans are endorsed by the Finan￿ Audit and Risk Committee, which receives regular reports on intemal audit activity. The Governors believe that Southbank Centre's system of internal financial control provides reasonable, bul not absolute, assurance that assets are safeguarded, transactions authorised and properly recorded, and that material errors and irregularities are either prevented or would be detected within a timely period. The Finance Audit and Risk Committee has monitored the operation and effectiveness of the system of internal financial control during the financial year ended 31 March 2023 through regular reports from senior staff, reports from the internal auditor and comments made in the annual management letter from the external auditors. Disclosure of information to auditors The annual audit of Southbank Centre is carried out by Crowe U.K. LLP, who express an audit opinion on the Southbank Centre's fi'nancial statements prior to them being laid before Parliament. In so far as the Governors are aware.. There is no relevant audit information of which the Charity's auditor is unaware. They have taken all steps necessary to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information. The Governors are responsible for the maintenance and integrity of the corporate and financial information included on the Charity's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 22 Fundraising statement Our aim is always lo ensure we raise funds from the public in a respecfful and compelling way that is consistent with our values. Our fundraising is carried out by our in-house fundraising teams and there are no arrangements for others to act on our behalf as professional fundraisers or commercial participators. Soulhbank Centre is a member of the Fundraising Regulator and supports its purpose and activities. We have procedures in place to ensure our staff and volunteers comply with the Fundraising Regulator's Code of Fundraising Practice and all relevant legislation,. we are not aware of any failure by our staff or volunteers lo meet these standards. We are committed to acting promptly if we receive any information indicating we have not met these standards. Soulhbank Centre did not re￿1ve any complaints about fundraising activities carried out. Soulhbank Centre recognises the need lo protect vulnerable people and ensures that no donation is sought or gained from someone who may not have the capacity lo make an informed or considered decision. Soulhbank Centre does not engage in unsolicited approaches to the public, whether by use of external agencies or othe￿￿lse for the purposes of raising funds. Donation boxes are present. Political and Charitable Donations In March 2022, Southbank Centre Enterprises Limited held an event with net proceeds to donated to the Disaster Emergency Committee IDECI for the Ukrainian Humanitarian Appeal. The net proceeds of this event lotalled £49k and this was paid to DEC in April 2022. Insurances During the year Soulhbank Centre maintained liability insurance cover for the Governors of the Board, for the Trustees of the South Bank Centre Retirement Plan, for the Executive Directors and for the in- house solicitor against the consequences of neglect or fault on their part in performance of their respective duties and functions. Southbank Centre also held insurance cover for the operation of its commercial vehicles, business travel and, when required, for works of art on loan from third parties. Limited Public Liability and Employers Liability insurance is held together with Business Interruption insurance in respect of commercial activities only. Apart from these insurances, Southbank Centre is self-insured by Treasury las confirmed by an agreement with the Department for Culture, Media and Sport). By Order of the Board Misan Harriman Chair 18 July 2023 Soulhbank Centre Limited As Trustee for Soulhbank Centre 23 STATEMENT OF TRUSTEE'S RESPONSIBILITIES The trustee Isoulhbank Centre Limited) is responsible for preparing the Annual Report and the financial ststemenls in accordance with applicable law and United Kingdom Accounting Stsndards Iuniled Kingdom Generally Accepted Accounting Practice). The law applicable lo charits'es in England and Wales requires the trustee to prepare financial ststemenls for each financial year which give a true and fair view of the stsle of affairs of the group and the charity and of the incoming resources and application of resources of the group and of the charity for that period. In preparing these financial slatemenls, the Iruslee is required lo.. Select suitable accounting policies and then apply them consistently. Observe the methods and principles in the applicable Charities SORP. Make judgements and estimates that are reasonable and prudent. State whether applieable accounting standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the financial statements", and, Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and the charity will continue in business. The trustee is responsible for keeping proper aceounling records that disclose with reasonable accuracy al any time the financial position of the group and the charity and enable it to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the trust deed. The Trustee is also responsible for safeguarding the assets of the group and the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The trustee is responsible for the maintenance and integrity of the group and the charity and financial information included on the charity's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial ststements. 24 INDEPENDENT AUDITOR'S REPORT Opinion We have audited the financial statements of Soulhbank Centre I'the charily'l and ils subsidiary I'the group'l for the year ended 31 March 2022 which comprise the Consolidated Statement of Financial Activities, Consolidated Balance Sheet and Charity Balance Sheet, Consolidated Cash Flow Statement and notes lo the financial slalemenls, including a summary 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 AC￿pted Accounting Practi￿). In our opinion the financial statements". give a true and fair view of the slate of the group's and the parent charity's affairs as al 31 March 2022 and of the group's incoming resources and application of resources, including ils income and expenditure for the year then ended., have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice., and have been prepared in accordance with the reqU1￿ments of the Charities Act 2011. Basis for opinion We conducted our audit in accordance with International Standards on Auditing IUKI IISAS IUKII 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 group in accordance with the ethical requirements that are relevant to our audit of the financial ststemenls 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 lo provide a basis for our opinion. Conclusions relating to going concern In auditing the financial stslements, we have Concluded that the trustee's 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 doubl on the charity's or the group's ability to continue as a going concern for a period of at least ￿e1ve months from when the financial statements are aulhorised for issue. Our responsibilib'es and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report. Other information The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial slalemenls and our auditorfs report thereon. Our opinion on the financial slalemenls does not cover the other information and, except lo the extent otherwise explicitly staled in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other infomiation 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 lo be materially misststed. If we identify such material inconsistencies or apparent material misststemenls, we are required to determine whether this gives rise lo a material misststemenl in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstalemenl of this other information, we are required lo report that fact. We have nothing to report in this regard. Matters on which we are required to report by exception We have nothing to report in respect of the following matters in relation to which the Charities 25 (Accounts and Reports) Regulations 2008 require us to report lo you if, in our opinion.. the information given in the financial statements is inconsistent in any material respect with the trustees, report., or suffi'cient and proper accounting records have not been kept by the parent charity", or the financial statements are not in agreement with the accounting records and returns., or we have not received all the information and explanations we require for our audit. Responsibilities of trustees As explained more fully in the Iruslees, responsibilities statement, the trustees are responsible for the preparation of the financial stslements and for being satisfied that they give a true and fair view, and for such internal control as the Iruslees determine is necessary lo enable the preparation of financial statements that are free from material misstatement, whether due lo fraud or error. In preparing the financial slatemenls, the Iruslees are responsible for assessing the group's and the parent charity's ability lo continue as a going GOn￿rn, disclosing, as applicable, mallers related lo going concern and using the going Gon￿rn basis of accounting unless the trustees either intend lo liquidate the charity or lo cease operations, or have no realistic alternative bul to do so. Auditor's responsibilities for the audit of the financial statements We have been appointed as auditor under section 151 of the Charities Act 2011 and report in accordance with the Acts and relevant regulations made or having effect thereunder. Our objectives are lo obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due lo fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assuran￿, bul is not a guarantee that an audit conducted in accordance with ISAS IUKI will always detect a material misstalemenl when it exists. Misslatemenls can arise from fraud or error and are considered material If, individually or in the aggregate, they could reasonably be expected lo influence the economic decisions of users taken on the basis of these financial slatemenls. Details of the exlenl to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below. A further description of our responsibilities for the audit of the financial statements is I(￿￿ted on the Financial Reporting Council's website at." www.frc.or .uklauditorsres onsibililies. This description foms part of our auditor's report. Extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are instsnces of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due lo fraud or error, and discussed these belmeen our audit team members. We then designed and performed audit procedures responsive lo those risks, including obtaining audit evidence sufficient and appropriate lo provide a basis for our opinion. We obtained an understanding of the legal and regulatory frameworks within which the charity and group operates, focusing on those laws and regulations that have a direet effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Charities Act 2011, together with the Charities SORP IFRS 1021. We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items. In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements bul compliance with which might be fundamental lo the charity's and the group's ability to operate or to avoid a material penalty. We also eonsidered the opportunities and incentives that may exist within the charity and the group for fraud. The laws and regulations we considered in this context for the UK opeotions included General Data Protection Regulation IGDPRI, Health and Safety legislation and employment legislation. Auditing standards limit the required audit prO￿dureS to identify non-complian￿ with these laws and regulations lo enquiry of the Trustees and other management and inspection of regulatory and legal corresponden￿, if any. 26 We identified the greatest risk of Material impact on the financial statements from irregularities, including fraud, lo be within the timing of recognition income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management, legal counsel and the Finance, Audit and Risk Committee at)out their own identification and assessment of the risks of irregularities, testing on the posting of journals, reviewing accounting eslimales for biases, reviewing regulatory correspondence with the Charity Commission, and reading minutes of meetings of those charyed with governance. Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements. even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations lirregularitiesl is from the events and transactions reflected in the financial statements, the less likely the inherenlly limited procedures reqLJired by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non- detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non- compliance and cannot be expected to detect non-compliance with all laws and regulations. Use of our report This report is made solely lo the charity's trustees, as a body, in accordan￿ with Part 4 of the Charities (Accounts and Reports) Regulations 2008 and Regulation 10 of the Charities Accounts (Scollandl Regulations 2006. Our audit work has been undertaken so that we might slate to the charity's Iruslees those mallers we are required to slate to them in an auditorfs report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility lo anyone other than the charity and the charity's trustees as a body, for our audit work, for this report, or for the opinions we have formed. fO¢oe LL Crowe U.K. LLP Slatulory Auditor London 18 July 2023 27 SOUTHBANK CENTRE CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITES For the Year ended 31 March 2023 Unrestricted Fund5 Restricted Funds Oper8tion5 Designated Piojed C8Plt81 £'ooo £'ooo £'ooo £'ooo Tol81 Funds 2023 2022 £'ooo £'ooo Note INCOME FROM.. Donations and legacies Charitable Activities Other Trading Activities Investments TOTAL 20,314 11,150 18.225 465 50,154 3,128 23,442 11,150 18,225 465 53,282 22,753 5,747 14,603 52 43,155 3,128 EXPENDITURE ON.. Raising funds Charitable activities Other TOTAL 1,290 38,649 7,018 44.957 37 6,115 637 6,789 1,327 44,898 7.655 53,880 1,059 37,158 4,231 42,448 2,134 2,134 Nel lexpendilurellinwme before transfers 5.197 16,7891 15981 707 Transfers 19 {7.5151 7,445 70 Other recognised Ilossesllgains Actuali81 Ilossllgain on delined benerrt pension 5th8tll85 GainllL0551 on derivative finanual instrument 23 15001 1,070 1,070 1,026 Net Movement in funds 2,318 1,726 1,064 472 1,233 Fund balances brought forward at 1 April 2022 Total funds carried forward at 31 March 2023 7,882 219,319 1,036 228,237 227,004 221045 2.1CM) 228 709 228 237 All of the above results are derived from continuing activities. The notes on pages 34 to se form part of these financial statements. The financial statements have been prepared in accordance with FRS 102. Full prior year disdosure of the Consolidated Statement of Financial Activities is shown in Note 27. There is no material difference between the net incomellexpenditurel before transfers for the financial years stated above and their historical cost equivalent. 28 SOUTHBANK CENTRE BALANCE SHEETS As at 31 March 2023 Group Charlty Notes 2023 £'O(K) 2022 £'ooo 2023 E'ooo 2022 £'O(K) Fixed assets Tangible assets Heritage assets Intangible assets Investrnents 225,492 70 89 18,097 230,627 225.492 70 89 18,097 230,627 12 14 252 16,029 252 12,029 Total fixed assets 243,748 246,908 243,748 242,908 Current assets Stocks of oonsum8ble$ and goods held for resale Debtors- due within one year Cash and cash equivalents 303 6,411 22,147 292 6,344 20,829 31 5,296 15,322 45 9,703 16,075 Totsl current assets 28,861 27,4S5 20,849 25,823 Liabilities Creditors.. amounts falling due within one year 18 122,6571 117,2021 120,844) 115,9041 Net Current a8¥9ts 6,204 10,263 11951 9,919 Total assèts 249.952 257.171 243,553 252.827 Creditors.. amounts falling due after one year 121.2431 128.9341 121,243} 128.9341 Nel assets exduding pension liability 228,709 228,237 222,310 223,893 Defined benefit pension asset I Iliabilityl 23 Totsl net assets 228,709 228,237 222,310 223,893 29 THE FUNDS OF THE GROUP As at 31 March 2023 Group Charity Notes 2023 £'ooo 2022 £'ooo 2023 £'ooo 2022 £'o Unrestricted income funds General resetves 5,564 7.882 1835} 3,538 Designated funds Pension reserve 221,045 219,319 221,045 219,319 23 221,045 219,319 221,045 219,319 Totsl unrestricted income funds 226.609 227,201 220.210 222.857 Restricted Income funds Projects fund 2,100 1,036 2,100 1,036 Total restricted income funds 2,100 1,036 2,100 1,036 Total group funds 228,709 228,237 222,310 223,893 The notes on pages 34 to 56 form part of these financial s18teTnents. The financial statetnents on pages 28 to 31 were approved by the Board of trustees and signed on its behalf by Misan Hairiman Chair 18 July 2023 Southbank Gent￿S (excluding Southbank cent￿ Ente￿rises Limited) gmss income for the year was £44,406k (2022 gmss inGome.' £36,735k). Southbank Cent￿$ {exGluding Southbank cent￿ Ente￿nSeS Limited) net expenditu￿ for the year was £2,651k (2022 nel expenditu￿.. £2,458k). 30 SOUTHBANK CENTRE CONSOLIDATED STATEMENT OF CASH FLOW As at 31 March 2023 Note 2023 £'ooo 2022 £'ooo Nel cash inflow from operating activities 8,496 17,066 Net cash generated from operating activities 8,496 17,066 Cash Ilow from investing activities Purchase of tsngible fixed assets Purchase of intangible fixed assets Investments Sale of tangible fixed assets Interest re￿1Ve￿ 13,0801 11,8811 1101 14,0281 12 14 12,0681 51 465 52 Cash used in investing activities 14,6321 15,8671 Cash Ilow from financing activities Loan received Repayment of loan Interest expense 11,4821 11,0631 19781 11 1051 Cash generated (used inl I from financing activities 12,5451 12,0831 Net Idecreasel l increase in cash and cash equivalents 1,319 9,116 Cash and cash equivalents al the beginning of the year 20,829 11,713 Cash and cash equivalents al the end of the year 22,148 20,829 Nel loutgoingl l incoming reSoUr￿S before transfers 15981 707 Interest received Interest paid Depreciation and amortisation charge LossllGainl on FA disposal Impairment of Intsngible Fixed Assets IlncreasellDecrease In stock Decreasellincreasel in debtors (Decreasell increase in creditors Retirement benefits movements 14651 1,063 8,379 1501 1521 1,105 8,108 85 11, 12 12 1101 1671 244 {61 2,952 4,167 15 16, 18 23 Net cash inflow from operating activities 8,496 17,066 31 SOUTHBANK CENTRE NOTES TO THE FINANCIAL STATEMENTS 1. Statement of Accounting Policies aj Basis of Preparation The financial statements have been prepared in accordance with the Statement of Recommended Practice." Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS 1021 issued in July 2014 ISORPI and the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland IFRS 1021 and the Charities Act 2011 and UK Generally Accepted Practice as it applies from 1 January 2015. The financial statements have been prepared to give a 'lrue and fair, view and have departed from the Charities (Accounts and Reports) Regulations 2008 only lo the extent required lo provide a'lrue and fair view. b) General Information Southbank Centre is a registered charity (Registered Charity No. 2989091 and Is incorporated and domiciled in the United Kingdom. The address of its registered office is Belvedere Road, London, SE1 8XX. c) Summary ofsignrfic8nt accounting policies The principal accounting policies have been applied consistently in dealing with items which are considered material in relation lo Soulhbank Cenlre's Financial Statements are as follows. d) Going Concern The Governors are required to Consider whether the Southbank Centre has sufficient current and forecast cash resources to cover the working capital requirements of the company for at least 12 months from the date of signing this report and financial statements. The key fi'nancial risk lo Southbank Centre is considered lo be the impact of inflation on the organisation through any reduction in demand due lo the increases in cost of living on our visitors or our artistic and commercial partners and the impact on the cost base, in particular the level and variability of energy costs The Charity has therefore modelled various scenarios in order to assess the impact of variability in demand or increases in its cost base. Given the level of reserves and cash holdings the Board considers that there are sufficient resources available lo the Charity to sustain the operation in all likely scenarios and the Charity will be able meet all the requirements of our loans and obligations under our ACE NPO Funding Agreement. We continue to monitor and lake necessary actions lo ensure that we maintain an appropriate reserve and cash levels in order lo operate. Having taken these factors into account the Board of Governors has a reasonable expectation that Southbank Centre has adequate resources to continue operating for the foreseeable future being at least twelve months from the dale of approval of these financial statements and, for this reason, have prepared the financial statements on a going concem basis. 32 1 Statement of Accounting Policies {continued) e) Group Financial Statements A wholly owned subsidiary, Southbank Centre Enterprises Limited, undertakes certain commercial activities on behalf of Soulhbank Centre. The results of Southbank Centre Enterprises Limited are consolidated with the financial stslemenls for Soulhbank Centre Itogether the 'group'l. In accordance with Section 408 of Companies Act 2006, a separate Statement of Financial Activities for Southbank Centre is not shown. See note 24 for details on the reSu￿S of Soulhbank Centre Enterprises Limited. Uniform accounting policies are used across the group, and inlra-group transactions are eliminated on consolidation. Income Recognition All income is recognised On￿ the charity has enlillemenl to the income, il is probable that the income will be received and the amount of income receivable can be measured reliably. The grant received from Arts Council England is recognised within income in the period lo which il relates. Any grants received in advan￿ of enlillemenl are deferred and included within creditors. Donations and sponsorship are included as income when they are receivable, provided that there are no donor-imposed restrictions as lo the timing of the related expenditure, in which case reC￿nitIon is deferred until the pre-condition has been mel. Funding for assets under eonstruction is credited lo incoming resources when receivable. Income from other trading activities comprises income from trading activities, fundraising, and other income. This income is recognised on a re￿1vable basis. Income classified as 'Artistic activity, which relates lo performance and specific deliverables is rec￿nISed when the group earns the right to consideration by its performance. Where income is received in advance of entitlement its recognition is deferred and included in creditors. Where entitlement occurs before income is received, the income is accrued. Amounts received in respect of Creative Tax Reliefs are included as income for the relevant activity when receivable. g) Expenditure and resources expended As with income, expenditure is recognised as incurred in the financial year of the particular activity to which il relates. Resources expended are included in the Statement of Financial Activities on an accruals basis, and are classified under headings that aggregate all costs related to that category. The costs of those activities which support one or more of the group's activities have been allocated to those activities using an appropriate basis. Cost allocation includes an element of judgement and consideration has been given lo the cost benefit of detailed calculations and record keeping. Costs of Raising Funds are those incurred by the Development department for the purposes of the group. Retail and trading costs are those incurred in the running of commercial activities on the estate. Governance costs comprise those incurred as a result of constilulional and stslutory requirements. A breakdown of these costs is included in Note 10- Allocation of Support Costs h) Taxation The Charity is a registered charity. and as such is entitled lo certain tax exemptions on income and profits from Inveslmenls. and surpluses on any trading a¢livilies carried on in furtherance of the charity's primary objectives, if these profits and surpluses are applied solely for charitable purposes. i) Foreign Currencies The functional and presentational currency is pounds sterling. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange at the balance sheet dale. All differences are recognised in the Statement of Financial Activities. 33 1 Statement of Accounting Policies {continued) J) Employge Bengfits The Group provides a range of benefits to employees, including holiday pay, annual bonus arrangements and defined benefit and defined contribution pension plans. i) Short term benefits Short term benefits, including holiday pay, termination payments and other similar non-monelary benefits, are recognised as an expense in the period in which the service is received. ii) Defined Gontribulion pension plans For defined contribution plans the amount charged lo the Statement of Financial Activities in respect of pension costs and other posl-relirement benefits is the contributions payable in the year. Differen￿ between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the balan￿ sheet. iii) Defined benefit pension plans Southbank Centre contributes lo a pension scheme through the South Bank Centre Retirement Plan Ilhe Pension Plan), In which there are defined benefit and defined contribution sections. The defined benefit scheme was closed to future accrual during the year and the defined contribution funds transferred to a master trust. The defined contribution section will be formally closed In 2023. The Pension Plan's assets are held separately from those of Southbank Centre in an independently administered trust fund. Southbank Centre is complying with the reporting requirements of Section 28 of FRS 102 'Employee Benefits,, in relation to the Pension Plan's defined benefit section, and the surplus is treated as an unrestricted fund. A defined benefit plan defines the pension benefit that the employee will receive on retirement usually dependent on several factors including age, length of service and remuneration. A defined benefit plan is a pension plan that is not a defined contribution plan. Pension plan assets are measured al fair value. The defined benefit obligation is calculated using the projected unil credit method. Annually Southbank Centre engage independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating the eslimaled period of the future payments I'discount ote'l. The fair value of the plan assets is measured in accordance with FRS 102 fair value hierarchy and in accordance with the group's policy for similarly held assets. This includes the use of appropriate valuation techniques. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to the Statement of Financial Aclivilies. These amounts together with the return on plan assets, less amounts included in nel interest, are disclosed as 'Remeasuremenl of nel defined benefit pension plan.. The cost of the defined benefit plan, recognised in Statement of Financial Activities as employee costs, except where included in the cost of an asset, comprises.. al the increase in pension benefit liability arising from employee service during the period., and bl the cost of plan introductions, benefit changes, curtailments and settlements The net interest cost is calculated by applying the discount rale lo the net balance of the defined benefit obligation and the fair value of plan assets. The cost is recognised In the Statement of Financial Activities as finance expense. k) Leases il Where the group enters into a lease which entails taking subslanlially all the risks and rewards of ownership of an asset, the lease is treated as a finance lease. The asset is recorded in the Balance Sheet as a tangible fixèd asset and is depreciated over ils estimated useful life or the term of the lease, whichever is shorter. Future instslments under such leases, nel of finance charges, are included in creditors. Rentals payable are apportioned between the finance element 34 representing a constant proports'on of the capital balance outstanding, which is charged to the SOFA, and the capital element which reduces the outstanding obligation for future instslments. All 1 Statement of Accounting Policies {continued) k) Leases (continued) other leases are accounted for as operating leases and the rentals are charged to the SOFA on a straight line basis over the life of the lease. ill Where income is receivable under retail unit or similar lease agreements, the basic element is recognised on a straight line basis over the period to the next rent review, and any element based on a percentage of turnover of the lessee is recognised in the period lo which that turnover relates. l) Fixed assets and depreciatio The Royal Festival Hall, Queen Elizabeth Hall and Purcell Room and the Hayward Gallery are staled in the balance sheet al depreciated replacement cost as al 1 April 2014 with additions sin that date included al cost. All other land and buildings have been staled at cost. il Depreciation is provided on the properties at rates calculated to write off the revalued amounts over the estimated useful lives of the major buildings. New additions have been written off over the useful life of the building to which that addition relates. Site development costs are capilalised and depreciated over 10 years. their expected period of economic benefit. Expenditure on maintenance of the properties is charged to the Statement of Financial Activities in the year in which it is incurred. Depreciation on lease premiums is charged over the length of the lease. ill Depreciation is provided on all other tangible fixed assets acquired since 1 April 1986 at mtes calculated to write off the cost less estimated residual value of each asset over ils expected useful life. The expected useful life is reviewed on an annual basis along with the residual value of assets. The expected useful life for Fixtures and Fittings is 10 years, for Plant and Machinery 4 years and for Motor Vehicles 8 years. Individual items costing under £1,000 are not capitalised unless they form part of a bulk purchase costing over £1,000 in aggregate and can be monitored. iiil Assets in the course of construction are held al cost and are not depreciated. iv} The carrying values of tangible fixed assets are reviewed for impaimient when events or changes in circumstances indicate the carrying values may not be recoverable. m} Intangible fixed assets and amortisation Intangible assets with an economic life of more than more than one year and value greater than £1,000 are capitslised. All intangible assets are measured al cost. Amortisation is provided on all intangible assets, al rates calculated to write off the value of each asset evenly over its expected useful life with no residual value assumed. Purchased SOf￿are li￿nCeS the conlraclual period Website 4 years Amortisation is charged on the month when assets are capilalised and ends the month they are disposed. The Carrying values of intangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the Carrying values may not be recoverable. n) Heritage assets Southbank Centre maintains the followng types of heritsge assets.. The Southbank Centre Collection of artwork and sculptures that have been gifted to Southbank Centre. The Soulhbank cent￿ Archive which aims lo collect, manage and preserve information, documents and artefacls olating to events and exhibitions held in the performing arts and public spaces of Southbank Centre. The National Poetry Library, the most comprehensive and accessible collection of modern poetry in Britsin. 35 A heritage asset is recognised when that asset has historic, artistic, scientific, technological, geophysical or environmentsl qualities they contributes to knowledge and culture thmugh its retention and use and is accessible to the public for viewng andlor research. 1 Statement of Accounting Policies {continued} nj Heritag& asset (continued) Acquisitions to Southbank Centre's heritage assets are made by donations or purchase. Southbank Centre may occasionally dispose of assets from ils collections if the Trustee believes this is in the best interest of Southbank Centre and this is not deemed lo compromise the integrity of the collections. The Trustee believes that given the incomparable nature of Soulhbank Centre's heritage assets even if valuations could be obtained, the costs would be onerous compared with the additional benefits derived by Soulhbank Centre and users of the financial statements. As a result, Soulhbank Centre does not recognise these items on the Balan￿ Sheet, other than recent acquisitions of athork and sculptures for the Soulhbank Centre Collection. Recent acquisitions of artworks and sculptures greater than £1,000 are recorded al cost if acquired, or al Soulhbank Cenlre's best estimate of fair value if donated to Soulhbank Cenlre. Purchases under £1,000 and costs associated with renovating and maintaining Southbank Cenlre's archive, poetry library and other heritage assets are recognised In the Statement of Financial Activities in the period they are incurred. ol Stocks Stocks are staled at the lower of cost and estimated selling price less costs lo sell and comprise catalogues and other goods held for resale. Cost is determined on a weighted average basis. A provision is made for slow moving, obsolete or defective stock to the extent that the cost price is eslimaled lo exceed the net realisable value. There is no material difference between the value of stock as stated and the replacement cost of this stock. pl Impairment of tangible and intangible assets At each balance sheet date non-financial assets not carried at fair value are assessed lo determine whether there is an indication that the asset may be impaired. If there is such an indication the recoverable amount of the asset is compared lo the carrying amount of the asset." The recoverable amount of the asset is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of the future cash flows before interest and lax obtainable as a result of the asset's continued use. These cash flows are discounted using a pre- tax discount rale that represents the current market risk-free rale and the risks inherent in the asset. If the recoverable amount of the asset is eslimaled to be lower than the carrying amount, the carrying amount is redU￿d lo ils recoverable amount. An impairment loss is recognised in the Statement of Financial Activities unless the asset has been revalued when the amount is recognised in other comprehensive income to the exlenl of any previously recognised revaluation. Thereafter any eX￿sS is recognised in statement of financial activities. If an impairment loss is subsequently reversed, the carrying amount of the asset lor asset's cash generating unill Is increased to the revised estimate of its recoverable amount, bul only to the exlenl that the revised carrying amount does not exceed the carrying amount that would have been determined Inet of depreciation or amortisalionl had no Impairment loss been recognised In prior periods. A reversal of an impairment loss is recognised in the Statement of Financial Activities. ql Cash and cash equivalents Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short term highly liquid Investments with original malurilies of three months or less and bank overdrafts. Bank overdrafts, when applicable, are shown within borrowings in current liabilities. rl Funds Unrestricted funds are those funds which can be used for any charitable purpose. Within unrestricted funds are designated funds which are those funds which have been set aside by the 36 Governors for a particular purpose. Reslricled funds May only be used in accordance with the specific wishes of donors. 1 Statement of Accounting Policies {continued) rl Funds Icontinuedl Al year-end the levels of funds are reviewed and transfers are made be￿een funds lo reflect where donor requirements on restricted funds ulilised for capital purchases have been met, and a change in the level of designated funds is deemed appropriate. sl Financial instruments The Group has chosen lo adopt Sections 11 and 12 of FRS 102 in respect of financial instruments. The Group has taken reduced disclosure exemptions for Sections 11 and 12 FRS 102. lil Financial assets Basic financial assets, including trade and other receivables, cash and bank balances and investments in commercial paper, are initially recognised al transaction price, unless the arrangement conslitules a financing Iransaclion, where the transaction is measured at the present value of the future re￿iptS discounted at a market rate of interest. Such assets are subsequently carried at amortised cost using the effective interest method. At the end of each reporting period financial assets measured al amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in the Statement of Financial Activities. If there is decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been rec￿nised. The impairment reversal is recognised in the SOFA. Such assets are subsequently carried at fair value and the changes in fair value are recognised in the SOFA, except that investments in equity instruments that are not publically traded and whose fair values cannot be measured reliably are measured al cost less impairment. Financial assets are derecognised when lal the contractual rights to the cash flows from the asset expire or are sellled, or Ibl substantially all the risks and rewards of the ownership of the asset are transferred lo another paty or Icl despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another paty who has the practical ability to unilaterally sell the asset lo an unrelated third party without imposing additional restrictions. Basic financial liabilities, including trade and other payables, bank loans, that are classified as debt, are Initially recognised at transaction price, unless the arrangement ¢onslitules a financing transaction. where the debt instrument is measured at the present value of the future receipts discounted al a market rale of interest. Debt instruments are subsequently carried at amorbsed cost, using the effective interest mte method. Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured al amortised cost using the effective interest method. 37 Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Southbank Centre uses derivative financial instruments lo reduce exposure 1 Statement of Accounting Policies {continued) sl Financial instruments Icontinuedl to interest rate movements. Southbank Centre does not hold or issue derivative financial instruments for speculative purposes. Derivatives including interest rate swaps are initially recognised al fair value on the dale a derivative contract is entered into and are subsequently re-measured at their fair values. Changes in the fair value are recognised in the Statement of Financial Activities in finance costs or finance income as appropriate, unless they are included in a hedging arrangement. The swaps are derecognised when the liability are extinguished, that is when the contractual obligation is discharged, cancelled or expires. Financial liabilities are derecognised when the liability is extinguished, that is when the conlraclual obligation is discharged, cancelled or expires. liiil Offsetting Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right lo set off the recognised amounts and there is an intention to settle on a nel basis or to realise the asset and settle the liability simultaneously. iv) Hedging arrangements The group does not generally apply hedge accounting in respect of forward foreign exchange contracts held to manage the cash flow exposures of forecast transactions denominated in foreign currencies. The group applies hedge accounting for transactions entered into to manage the cash flow exposures of borrowings. Interest rale swaps are held to manage the interest rate exposures and are designated as cash flow hedges of floating rale borrowings. Changes in the fair values of derivatives designated as cash flow hedges, and which are effective, are recognised directly in equity. Any ineffecliveness in the hedging relationship (being the excess of the cumulative change in fair value of the hedging instrument Sin￿ inception of the hedge over the cumulative change in the fair value of the hedged item since In￿ptIOn of the hedge) is recognised in the SOFA. The gain or loss recognised in other comprehensive income is reclassified lo the income statement when the hedge relationship ends. Hedge accounting is discontinued when the hedging Instrument expires, no longer meets the hedging criteria, the forecast transaction is no longer highly probable, the hedged debt Instrument Is derecognised or the hedging Instrument Is terminated. tl Critical accounting judgements and key source of eslimalion uncertainly The preparation of the financial stslements requires management to make judgements, eslimales and assumptions th81 affect the application of the accounting policies and the reported amounts of assets and liabilities, revenue and expenses. Actual results may differ from these estimates. Eslimales and undedying assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are reasonable under the circumstances. Revisions to accounting estimates are recognised in the period in which the eslimales are revised and in any future periods affected. Crilieal judgements in applying the enlily's accounting policies". lil Impairment of debtors 38 The company Makes an estimate of the recoverable value of trade and other debtors. When assessing impaiment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 15 for the nel carrying amount of the debtors. 1 Statement of Accounting Policies {continued} tl Critical accounting judgements and key source of eslimalion un￿rtainlY Iconlinuedl li1} Defined benefit pension scheme The company has an obligation to pay pension benefits lo certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including., life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management eslimales these factors in determining the nel pension obligation in the balan￿ sheet. The assumptions reflect historical experience and current trends. See note 23 for the disclosures relating to the defined benefit pension scheme. liiil Deferred and advanced lickel income Deferred Income and income received in advance has been reviewed and where il has been agreed that the income will be deferred to an event after 31 March 2023, this has been treated as Creditors falling due after one year. 39 2 Donations and Legacies Unrestricted Funds £'ooo Restricted Funds £'ooo 2023 £'ooo 2022 £'ooo Donations and sponsorships Arts council grant Funding for asset construction Other grant income Totsl 1,456 18,858 2,313 815 3,769 19,673 1,990 20,350 350 63 22.753 20.314 3.128 23,442 3 Charltable Actlvltles Unreslricled Funds £'ooo Restricted Funds £'ooo 2023 £'ooo 2022 £'ooo Artistic activities Ticket Income Artistic rentals Other income Total 8,107 2,311 732 11,150 8,107 2,311 732 11,150 3,456 1,819 472 5.747 4 Other Tradlng Actlvltles Unreslricled Funds £'ooo Restricted Funds £'ooo 2023 £'ooo 2022 £'ooo Other Tradlng Actlvltles Retail sales Concessions Hall and space rentals Memberships and subscriptions Other income Totsl 1,687 10,834 3,195 1,687 10,834 3,195 1,061 7,238 2,551 882 1,827 18,225 882 1,627 18,225 764 2,989 14.603 5 Investments Unreslricled Funds £'ooo Restricted Funds £'ooo 2023 £'ooo 2022 £'ooo Interest receivable Total 465 465 465 465 52 52 40 6 Net Income I (Expenditure) 2023 £'ooo 2022 £'ooo Nel incomel lexpendilurel is staled after charging Icreditingl.. Operating lease charges Depreciation and amortisation charge on assets Auditors, remuneration for audit services Isoulhbank Cenlrel Auditors, remuneration for audit services (Enterprises) Losses on foreign exchange differences Income from Creative Tax reliets included within income trom charitable activities Bad debt expense 367 8,367 70 173 8,108 60 25 16421 45 12701 19231 7 Interest Expense Unreslricled Funds £'ooo Restricted Funds £'ooo 2023 £'ooo 2022 £'ooo Interest expense Total 1,105 1.105 1,063 41 8 Staff Costs 2023 £'ooo 2022 £'ooo Employee costs amounted to.. Wages and salaries Social security costs Pension costs Total 14,887 1,452 834 17,173 11,709 1,116 645 13,470 Costs relating to lerminalions in the year are included in the above and were £64k12022.. £26kl ofwhich Nil12022.. £nill was accrued al year end. The Governors (Chairman and Board members) are not remunerated for their services and Governors received £nil12022.. £nill in reimbursement of Iravelling and subsistence expenses. Average number of employees Average full time equivalent number of employees 2023 No. 14 100 23 212 349 2023 No. 14 111 28 294 447 2022 No. 12 97 21 229 359 2022 No. Raising Funds Charitable Aclivilie5 Other Support 88 18 173 291 Visitor Experience staff who staff all of our venues are included within support staff. Higher paid employees received remuneration, including redundancy payments bul excluding pension costs, within the following bands.. 2023 No. 10 2022 No. 12 £60,000 - £69,999 £70,000 - £79,999 £80,000 - £89,999 £90,000 - £99,999 £100,000 - £109,999 £110,000 - £119,999 £120,000 - £129,999 £130,000 - £139,999 £150,000 - £159,999 £160,000 - £169,999 £180,000 - £189,999 25 21 Of these 25 12022.. 211 employees, Southbank Centre paid pension contributions of £270,895 for 24 employees12022.' £70,103,. 13 employees), who were members of the defined contribution section of the pension scheme. The group also paid contributions for 1 employee of £15,52712022'. £19,954., 1 employee) who was a member of the defined benefit section of the pension scheme. The Executive Leadership Team comprises of 6 full lime stsff12022 5 staff) whose remuneration in the year was £752k12022'. £480kl. In addition to this, Southbank Centre also paid £45k12022.' £9kl in pension contribution and £95k in Employer National Insurance Conlributions12022'. £61 kl. The increase in remuneration for the Executive Leadership Team in 2023 Is due to vacancies in senior positions during 2022 which have now been filled. In 2022 the full-time equivalent ELT staff was 3.8 as compared to 5.8 in 2023. The Chief Executive's total remuneration for the year totalled £186k {2022 £154kl. The Chief Executive has opted to continue taking a voluntary reduction in total pre covid remuneration, amounb'ng to 27 /0. No Executive Leadership Team member receives bonuses. 42 9 Total Resources Expended Artist, Exhibition, Creative Learning and Public Participation costs £'ooo Artist and Exhibition Venue running costs £'ooo Total support costs £'ooo Total 2023 Total 2022 £'ooo £'ooo Costs of raising funds Expenditure on charitable activities other 942 16,974 103 16,218 283 11,706 1,328 44,898 1,059 37,158 4,028 21,944 1,938 18,259 1,689 13,678 7,655 53,881 4,231 42,448 Other includes interest payable of £1,063k12022. £1,105kl (note 71. 10 Allocatlon of Support Costs Management Support Services £'ooo Depreciation & Dispos815 £'otK) 2023 £'O(K) 2022 £'ooo Costs of raising funds Expenditu￿ on charitable actNities other Total Support Costs 235 4,197 283 11,7C 1,689 13,678 299 11.632 1,260 13,191 7,509 821 8,378 5,300 Management and Support Services comprises Finance, Legal, HR and Governance. These are allocated as above based on their proportionate costs lo overall Artist, Exhibition, Creative Learning and Public Participation costs. Depreciation relates to all depreciation over the entire sile and are allocated based on floor area. Costs classified as governance relate lo the general running of the charity and included operations of the Board of Governors and addressing conslitulional, audit and other statutory matters. Governance costs are included within management and adminislotion support costs and are made up of the following.. 2023 £'ooo 2022 £'ooo Internal audit External audit Governors. indemnity insurance Apportionment of staff costs 36 77 15 244 372 22 67 14 218 321 43 11 Tangible Assets Group and charity Land & Buildings IArtisticl £'ooo Land & Assets Buildings under (Other) Construction £'ooo £'ooo Fixtures Plant & & Fittings Machinery £'ooo Total £'ooo £'ooo Cost At 1 April 2022 Additions Transfers Disposals At 31 March 2023 257,309 77 109 26,647 224 116 11091 7,656 879 8,107 2,008 299,943 3,080 12 8,523 62 10,053 74 302,949 257,495 26,647 231 Accumulated Depreciation At 1 April 2022 Charge for the year On disposals At 31 March 2023 48,672 6,796 8,847 5,484 479 12 5,951 6,313 940 62 7,191 69,316 8,215 74 77,457 55,468 8,847 Net Sook Value At 31 March 2023 202,027 17,800 231 2,572 2,862 225,492 At 31 March 2022 208,637 17,800 224 2,172 1,794 230,627 12 Intangible Assets Group and charity Softhare £'ooo Total £'ooo Cost At 1 April 2022 Additions Transfers Disposals At 31 Mareh 2023 805 805 805 805 Accumulated Amortisalion At 1 April 2022 Charge for the year On disposals At 31 March 2023 553 163 553 163 716 716 Nel Book Value At 31 m?￿h 2023 89 89 At 31 March 2022 252 252 44 13 Heritage Assets The Southbank C&ntr& Collection The Southbank Centre Collection consists of approximately 30 sculptures and 80 drawings or prints that have been gifted to SC. 900/0 of the collection in 2004 was valued al approximately £200,000. This collection has been built up over the last sixty years and no assets were acquired or disposed of over the last five years. Soulhbank Centre aims lo have the majority of the collection on display to the public around its site. During the year ended 31 March 2023, SC has purchased I￿0 new pieces of artwork that have been added to the Southbank Centre Collection. These have been included al cost of purchase. Additions in year £'ooo Value at 31 March 2023 £'ooo Cost at 31 March 2023 £'ooo Carrying amount al 1 April 2022 Additions.. artwork Carrying amount at 31 March 2023 70 70 70 70 70 70 The Southbank Centre Archive Soulhbank Centre Archive aims to collect, manage and preserve information, documents and artefacts relating lo events and exhibitions held in the performing arts and public spaces of Southbank Cenlre. The Archive includes print material Iprogrammes, leaflets and festival brochures), photographs, recordings of performances and events, general ephemera Itickels, gifts, promotional items, objects and artefacts}, written or recorded memories, letters or postcards describing visits, employment or other experiences of the site. The archive is maintsined by Southbank Centre's Archivist. Poetry Library The National Poetry Library houses the National poetry collection. The collection, dating from about 1914, consists mostly of poetry from the United Kingdom and Ireland, a large selection from English- speaking countries worldwide, poetry in translation, poetry by and for children, rap and concrete poetry. Audio and video facilities are available in addition to a large variety of magazines, press cullings and ephemera. Membership is free and the library is open 6 days a week. The library contains over 100,000 items and is growing all the time. The library aims to hold all poetry tides published In the UK with a representation of works from other countries. The library is funded by the ongoing support of Arts Council England. 14 Investments Group 2023 £'ooo Charity 2023 £'ooo 2022 £'ooo 2022 £'ooo Cash on Short Term 18,097 18,097 16,029 16,029 18,097 18,097 12,029 12,029 45 15 Debtors: Amounts Due Within One Year Group 2023 £'ooo Charity 2023 £'ooo 2022 £'aoo 2022 £'ooo Trade debtors Amounts owed by group undertakings Other debtors Prepayments and accrued income 1,765 2,276 677 1,249 774 2,596 5,296 1,664 4,545 1,243 2,251 9,703 844 3,802 6,411 1,250 2,818 6,344 Trade debtors- Group is net of bad debt provision of £154k12022.. £111 kl, and Trade debtors- Charity is also net of bad debt provisions of £97k12022.. £111 kl. 16 Credltors.. Amounts Falllng Due Wlthln One Year Group 2023 £'ooo Charity 2023 £'ooo 2022 £'ooo 2022 £'ooo Bank loans and overdrafts Trade creditors Amounts owing to group undertakings Advanced ticket sales Derivative financial instrument Accruals and deferred income 6,429 3,118 1,270 4,198 6,429 3,035 1,270 3,965 2,797 362 9,951 22,657 2,897 2,797 362 8,221 20,844 2,897 8,837 17,202 7,772 15,904 Deferred income comprises amounts received for which the related service, project or expenditure, occurs in a future financial year. 17 Deferred Income Group 2023 £'ooo Charity 2023 £'ooo 2022 £'ooo 2022 £'ooo Deferred income brought forward Deferred in the year Released In the year Deferred income carried forward 2,793 3,403 2,933 2,080 1,853 1,885 1,767 1,697 3,505 1,987 46 18 Creditors.. Amounts Falling Due After One Year Group 2023 £'ooo Charity 2023 £'ooo 2022 £'ooo 2022 £'ooo Bank loans Derivative financial instrument Accruals and deferred income 21,191 27,400 1,432 102 28,934 21,191 27,400 1,432 102 28,934 52 21,243 52 21,243 The maturity of loans and obligations (including loans due within one yearl is as follows.. Group 2023 £'ooo Charity 2023 £'ooo 2022 £'ooo 2022 £'ooo Within one year Within two to five years After five years 6,429 11,694 9,497 27,620 1,270 10,356 6,429 11,694 9,497 27,620 1,270 10,356 17 044 28,670 28,670 A temi loan of £17.7m was provided by AIB Group IUKI plc in September 2004 to fund estate development and Is secured by a fixed charge over the Royal Festival Hall extension building. The loan is partially repayable in quarterly instalments until October 2027 when a balance of £6m will remain outstanding. The balance outstanding, including interest, at 31 March 2023 was £10.7m 12022.. £11.5ml. A term loan of £7.Om was provided by Lloyds Bank plc in June 2018 to fund estate development and is secured by an assignment and charge over the retail lease income from property at the Royal Festival Hall. The loan is partially repayable in quarterly instalments commencing in June 2019 until January 2024 when a balance of £5.2m will remain outstanding. The balance outstanding at 31 March 2023 was £5.5m12022. £6.Oml. The group also has in place a floating to fixed interest rate swap agreement with Lloyds Bank plc, entered into in January 2008 and expires in April 2027 which is subject lo a mandatory early termination in January 2024. At 31 March 2023, the fair value of the contmcts outstsnding was £362k12022.' £1.4ml. The loan received from the Culture Recovery Fund Repayable Finance of £10.gm is to provide additional liquidity in order to mitigate the effects of COVID-19 lockdown on the organisation. This provides for a fi'xed interest loan for 20 years at 20/0 per annum with a four-year capital repayment and interest payment holiday. Analysis in changes of nel debt Al start of year £'ooo Cash-flows £'ooo Al end of year £'ooo Cash and cash equivalents 20,829 1,318 22,147 Loans falling due within one year Loans falling due after more than one year 11,2711 27,400 7,842 15,1581 6,208 2,368 16,4291 21,192 5,474 47 19 Group and Charity Reserves Balances as at beginning of the year £'ooo Balances as at end of the year £'ooo Other Gains & Losses £'ooo Transfers lout) l in £'ooo Income £'ooo Expenditure £'ooo unT￿triCted Income Fund¥ General Reserves General Fund Total General Reserves 7,882 7.882 50,154 50,154 44,957 144,9571 7,515 17,5151 5,564 5,564 Designated Funds Capital & Revaluation Reserve Loan repayment reserve Strategic Inveslrnent Fund Total Unrestricted Funds 214.816 16.5021 1,070 2,254 5,899 211.638 5.899 4.503 12871 17081 3.508 227,201 50,154 51,746 1,070 70 226,609 Restricted Funds Projects Funds Total Restricted Funds 1,036 1,036 3,128 3,128 2,134 2,134 70 70 2,100 2,100 Total Funds120231 228,237 53.282 53,880 1.070 228,709 Totsl Funds120221 227,004 43,155 42,448 526 228,237 The following table discloses the resetves for the prior year as required by the Charities SORP. Balances as at beginning of the year £'ooo Balances as at end of the year £'ooo Other Gains & Losses £'ooo Transfers lout) l in £'ooo Income £'ooo Expenditure £'ooo Unrastrictèd Ineomè Funds G8neral RESe￿e8 General Fund CRF Repayable Finance Fund Total General Reserves 2.400 40,257 {34,0811 16941 7,882 9.082 11.482 9.082 19.7761 40.257 134.0811 7.882 Designated Funds Capital & Revaluation Reserve 2021r22 Restart Fund Strategic Investment Fund Pension Plan Reserve Inote 231 Total Unrestricted Funds 207,874 4,156 16,0631 1,026 11,979 14,1561 214,816 2,200 2,303 4,503 500 500 228,212 40,257 40,144 526 350 227,201 Restricted Funds Capital Reserve Projects Funds Total Restricted Fund8 350 13501 792 792 2.898 2.304 350 1.036 Total Funds120221 227,004 43,1 SS 42,448 526 228,237 48 19 Group and Charity Reserves Icontinuedl Unrestricted funds consist of a General Reserve and Designated Reserves. General ReseThes are available for spending on the group's charitable objectives. Designated Funds." The Capital & Revaluation Reserve reflects funds designated for capital projects, costs relating to capital projects (including interesll, maintenance and depreciation on funded assets as well as the balance of surplus or deficit on the revaluation of Land and Buildings (Artistic as per Note The Loan repayment reserve reflects funds designated for repayment of the loan provided by Lloyds Bank plc. This balance reflects the outstanding loan1£5.5ml and the fair value of the swap agreement 1£0.36ml at 31 March 2023. The Strategic Investment Fund has been set up lo provide investment in artistic ambition, innovation, inclusion, sustsinability and financial resilience over a 1-3 year timeframe. Restricted funds". The Projects Fund holds restricted grants received in advance of expenditure for operating projects. Transfers in the year In 2022123, £5.gm was transferred from the General Reserve to the loan repayment reserve 12022.. £1.5m was transferred from the General Reserve to the Capital Reserve12022.. £nill. £0.7m was transferred from the Strategic Investment Fund lo the Capital Reserve12022. £nill. £0.07m was transferred from the General Reserve lo the Restricted Reserve12022'. £nill. Charity Reserves The difference between the Group and Charity reserves is solely due lo the Gift Aided donation from Soulhbank Centre Enterprises Ltd to Soulhbank Centre. This donation of £6.4m12022". £4.3ml will be made after year end and credited lo the Soulhbank Centre reserves al the dale of receipt. Analysis of net assets between fund¥ Reslricled Unrestricted £'ooo £'ooo 2023 £'ooo 2022 £'ooo Tangible and intangible fixed assets Current assets Current liabilities Creditors falling due after one year 243,748 26,761 122,6571 21,243 226,609 243.748 28.861 122,6571 21,243 228,709 246,908 27,465 117,2021 28,934 228,237 2,100 2,100 20 Capital Commitments Group and Charity 2023 £'ooo 2022 £'ooo Aulhorised and contracted 1,727 604 Capital commitments in prior year related to property costs. 49 21 Commitments Under Operating Leases The Group had the following future minimum lease payments under non-cancellable operating leases, as a lessee, for each of the following periods.. 2023 £'ooo 2022 £'ooo Payments due Not later than one year 367 173 22 Operating Lessor The Group had the following future minimum lease receivables under non-cancellable operating leases, as a lessor, for each of the following periods.. 2023 £'ooo 2022 £'ooo Receipts due 28,972 28,987 Not later than one year Later than one year and not later than five years Later than five year 4,053 15,900 9,019 3,818 14,636 10,533 50 23 Pension Costs The group provides pension benefits through the Soulhbank Centre Retirement Plan which operates o different sections. The defined benefit section was closed to new members from 1 April 2001 and the defined contribution section was opened to new members of staff joining on or after that dale. Until May 2022 pension contributions were also made lo Now pensions. Neither South Bank Foundation Limited nor Soulhbank Enterprises Limited have a pension fund. The defined benefit section was closed lo future accrual in May 2022. From May 2022 all defined contribution contributions are made to the Aviva Master Trust. The defined contribution assets of the Soulhbank Centre Retirement Plan were transferred to that scheme in October 2023 and this sects'on of the scheme will be closed during 2023. The amount recognised in the SOFA Is as follows.. 2023 £'ooo 2022 £'ooo Defined benefit scheme Current serviee costs Defined contribution scheme Totsl charge in net expenditure Defined benefit scheme Net interest lincomel l expense 10 824 834 111 534 645 298 536 172 473 lal Defined benefit plan The defined bènefit section is funded by employer and employee contributions with assets held in separate Iruslee administered funds. A full actuarial valuation of the section was undertaken as at 1 April 2020 by a qualified independent actuary on behalf of the trLJStees of the plan. The actuary has undertaken additional calculations to produce eslimaled results for the purposes of Section 28 of FRS 102. The section closed to future accrual as from 1 May 2022 and no contributions are to be made into the scheme in respect of salaries after this date. The surplus on the pension scheme is not recoverable by the Southbank Centre until the pension scheme has been wound up, which is expected lo be a long way into the future. It is, therefore, not deemed lo be probable that the surplus will bring future economic benefi'ts lo the Soulhbank Centre as so many variables which go into calculating the surplus could change during this time. As such, an asset has not been recognised for the full balance of the surplus. As the scheme closed to future accrual as from 1 May 2022 the surplus is no longer anticipated to redu￿ future employer contributions lo the scheme, and therefore no asset has been recognised. The plan provides retirement benefits on the basis of members, final salary. The plan is administered by an independent Iruslee, who is responsible for ensuring that the plan is sufficiently funded to meet current and future obligations. An actuarial valuation of the plan, using the projected unil credit method, was carried out al 31 March 2022 by BBS Actuaries, independent consulting actuaries. Adjustments to the valuation at that date have been made based on the following key assumptions.. 2023 2022 Expected mte of salary increase Expected ote of inerease of pensions in payment Discount rate Rale of inflation {RPII Rale of inflation {CPII 2.80/0 2.00/0 4.60/0 3.3Q/ 2.80/ 3.30/0 2.10/0 2.70/0 3.80/0 3.3% 51 23 Pension Costs l¢ontinued} The mortality assumptions used were as follows.. 2023 ears 2022 ears Longevity at age 65 for current pensioners Men Women Longevity at age 65 for future pensioners Men Women 22.8 25.1 22.7 25.1 24.1 26.5 24.0 26.5 Reconciliation of plan assets and liabilities.. Assets £'ooo Liabilities £'ooo Total £'ooo At 1 April 2022 Benefits paid Employer contributions Member's contributions Current service cost Interest incomel lexpensel Remeasurement Ilossesl I gains Actuarial gains 69,925 11,8931 22 158,9231 1,893 11,002 22 1101 11,5651 60 14,768 1101 298 60 14,5981 1,863 119,3661 As at 31 March 2023 50,552 43 778 Total cost recognised as an expense.. 2023 £'ooo 2022 £'ooo Current seNice costs Interest cost 10 1,565 1,575 111 1,210 1,321 No amounts12021." £nill were included in the cost of assets. The fair value of the plan assets was.. 2023 £'ooo 2022 £'ooo Equities Liability driven equities Diversified growth fund Cash London Eye asset 34,126 10,467 254 5,705 50.552 46,896 15,523 770 6,736 69,925 The plan assets do not include any of Southbank Cenlre's fi'nancial instruments nor is any property occupied by any Southbank Centre entity. The retum on the plan assets was.. 2023 £'ooo 2022 £'ooo 52 Interest income Return on plan assets less interest income 1,863 19,366 17,503 1,382 124 1,506 23 Pension Costs (continued) Ibl Defined contribution plan Soulhbank Centre provides a defined contribution plan for its employees. The amount recognised as an expense for the defined contribution scheme was". 2023 £'ooo 2022 £'ooo Current year contributions 824 824 534 534 24 Subsidiaries Soulhbank Centre Limited owns 100Qkn of the issued share capital of South Bank Foundation Limited 1100 shares of £1 each), Soulhbank Centre Pension Fund Corporate Trustees Limited11 share of £1 each) and Soulhbank Centre Enterprises Limited 1100 shares of £1 each), on behalf of Soulhbank Centre. Southbank Centre is the controlling party lultimate parent company) and therefore consolidates these subsidiaries into its financial statements. Southbank Centre Limited only acts in the capacity of sole Corporate Trustee of Soulhbank Centre through the appointment of its directors (the Governors of Soulhbank Cenlrel and is olhetwise dormant. The South Bank Foundation Limited (number.. 3174667) The South Bank Foundation Limited was formed for the purpose of fundraising for Southbank Centre, particularly ils sile development. South Bank Foundation Limited was dormant during the year. The Southbank Centre Pension Fund CO￿Orate Trustees (number." 12510510) The Southbank Centre Pension Fund Corporate Trustees Limited was formed for the purpose of acting as a trustee for the Soulhbank Centre's pension fund. Southbank Centre Pension Fund Corporate Trustees Limited was dormant during the year. Southbank Centre Enterprises Limitgd (Registration number. 6158790) The principal activities of Southbank Centre Enterprises Limited are to manage certain commercial and retail activities on Southbank Cenlre's estate, including event hires, the bar and catering concessions and Soulhbank Cenlre's own shops. A summary of Soulhbank Centre Enterprises Limiled's trading results are shown below.. 2023 £'ooo 2022 £'ooo Turnover Cost of sales Administrative expenses Operating profit Interest receivable Nel profit Profit and loss brought forward Gift aid paid to Southbank Centre Limited Retained in the subsidiary 13,325 14,7131 2,314 6.297 101 6,398 4,344 10,248 12,4171 3,493 4,337 4,344 1,181 6,398 4,344 53 24 Subsidiaries Icontinuedl As al the balance sheet dale the aggregate amount of Southbank Centre Enterprises Limited assets, liabilities, share capital and reserves was.. 2023 £'ooo 2022 £'ooo Current assets Creditors." amount falling due within one year Nel current assets 9,461 3,063 6,398 10,183 5,839 4,344 Total net assets 6,398 4,344 Represented by.. Profit and loss account 6,398 4,344 Soulhbank Centre's subsidiary, Southbank Centre Enterprises Limited, has restated income and expenditure for the year ended 31 March 2022 for expected tsx ¢redils receivable. This has resulted in an increase lo income and expenditure of £1.8m respectively. There is a £nil effect on the Southbank Centre consolidated accounts as a result of this restatement. 25 Contingent Liabilities Group and Charity Capital grant funding The Royal Festival Hall refurbishment was financed by capital grants from Arts Council England and the Heritage Lottery Fund. A fixed and floating charge was taken out by Arts Council England and Heritage Lottery Fund over the assets of the charity. In the event that Southbank Centre ceases operating £49.2m would be repayable to Arts Council England and Heritsge Lottery Fund under this charge. The Royal Festival Hall extension building was financed by a £4m award from GLA Land and Property, fomiedy, London Development Agency. In the event that Southbank Centre ceases operating £4M would be repayable. A grant of £16.7m was provided by the Arts Council for refurbishments lo the Festival Wing {Queen Elizabeth Hall, PLJrcell Room and the Hayward Galleryl. A fixed and floating charge was taken out by the Arts Council England over the assets of the charity. In the event that the Soulhbank Centre ceases operating, this grant would be repayable lo the Arts Council. A term loan of £17.7m provided by AIB Group IUKI plc is secured by a fixed charge over the Royal Festival Hall extension building. This facility is repayable in quarterly instslments with the final balance repayable in October 2027. A term loan of £7m provided by Lloyds Bank plc and Lloyds Corporate Markets plc is secured by an assignment and charge over the retail lease income from property at the Soulhbank Centre. The loan is repayable in quarterly inslalmenls with the final balance repayable in January 2024. Land and buildings comprise Southbank Cenlre's three concert halls, the Hayward Gallery, the extension building, Jubilee Gardens and the National Film Theatre. the last of which is occupied by the British Film Institute on an under-lease. The freehold interest in these properties is vested in Arts Council England. A lease of 150 years on these properties was granted to Soulhbank Centre Limited by Arts Council England commencing on 1 April 1988 and the amount shown for land and buildings 54 represents Southbank Centre's interest. Under the terms of the lease there are constraints on the transfer of the properties and, therefore, the value cannot be realised for the benefit of Southbank Centre in an artistic way. Southbank Centre is responsible for Maintaining the properties and keeping them in good repair. The value lo Soulhbank Centre of its interest in the National Film Theatre has been assessed al nil, given the long under-lease to which it is subject. A peppercorn rent is payable on the lease from Arts Council England to Soulhbank Centre and on the under-lease from Soulhbank Centre to the British Film Institute. 26 Related Parties Soulhbank Cenlre, as sponsoring employer, has agreed to pay for the expenses of The Southbank Centre Retirement Plan. These expenses were £235,28312022'. £220,672) for the year ended 31 March 2023. The American Fund for Southbank Centre Inc. l American Fund I provides a tsx efficient method for Southbank Centre to receive donations from US based donors. During the year, Soulhbank Centre received USD nil12022'. USD 89,7251 from the American Fund. The American Fund had USD 147,182 12022.. USD 53,4011 in cash balances available to transfer to Southbank Centre at 31 March 2023. Donations from Trustees were £77,57412022.. £68,548). SBC'S Trading subsidiary, Soulhbank Centre Enterprises Ltd, was recharged staff costs of £779,952 12022.. £603,845), being the costs of staff incurred by the charity for activities undertaken by the company. A management fee of £1,164,357 12022.. £844,7541 was charged lo SCEL to cover overheads incurred by SBC. Amounts owing between the 2 entities at year end are shown in notes 16 and 17. 55 27 Full Prior Year Disclosure Of The Consolidated Statement Of Financial Activities Unrestricted Funds Restricted Funds Total Fund5 2022 £'ooo Operations £'ooo Designated Project Gapilal £'ooo £'ooo £'ooo Note INCOME FROM.. Donations and legacies Ch8rit8ble Activities Other Trading Activities Proceeds from Sale of fixed assets Investments TOTAL 19.855 5.747 14.603 350 22,753 5,747 14,603 52 40,257 52 43,155 350 EXPENDITURE ON.. Raising funds Charitable activities Other TOTAL 1,025 29,419 3,e37 34.081 1,059 37,158 4,231 42,448 5,435 594 6,063 2,304 2,304 Net lexpendilurellincome before transfers 6.176 I6.(￿3) 244 350 707 Transfers 19 {9,7761 10,126 13501 Other recognlsed Ilossesllgalns Actuaiial Ilossllgain on defined benefrt pension sthetnes G8inllL05sI on derivative financial instrument 23 15tK)I 15(K)I 1,026 1,026 Net Movement in funds 3,600 4,589 244 1.233 All of the above results are derived from continuing activities. The Movements on Reserves are also described in note 19. There is no material difference between the net incomellexpenditurel before transfers for the financial years stated above and their historical cost equivalents. Unrestricted funds Operations Designated £'ooo £'ooo Restricted funds Projects Capital £'ooo £'ooo Total funds 2022 £'ooo Nel movement in funds Fund balances brought forward as at 1 April 2021 Total funds al 31 March 2022 13,6001 11.482 4,589 214,730 244 792 1,233 227,004 7,882 219,319 1,036 228,237 56