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2022-07-31-accounts

Stockport Engineering Training Association Limited (A company limited by guarantee)

Report of the Trustees and Consolidated Financial Statements

For the year ended 31 July 2022

Company Number 1512311

Registered Charity in England no 510493

Stockport Engineering Training Association Limited Report and Consolidated Accounts Contents

Page
Report of the trustees 1 - 9
Report of the independent auditors 10 - 12
Consolidated statement of financial activities 3
Consolidated balance sheet 14 - 15
Charity balance sheet 16 - 17
Statement of Cash Flows and Consolidated Statement of Cash Flows 18
Notes forming part of the financial statements 19 - 34

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

The trustees are pleased to present their annual directors’ report together with the consolidated financial statements of the charity and its subsidiaries for the year ending 31st July 2022 which are also prepared to meet the requirements for a directors’ report and accounts for Companies Act purposes.

The financial statements comply with the Charities Act 2011, the Companies Act 2006, the Memorandum and Articles of Association, and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019).

Chairs Report

It has been a year of consolidation and continuous recovery from the effects of the Covid pandemic, across all aspects of the organisation. The SETA team have worked with flexibility and enthusiasm to bring education delivery in house and support the companies in the workplace to follow the business development plans.

The improvement to delivery of our academic programmes through to HND and the degree level have stalled due to student and lecturer continuity but it was still planned for future delivery to benefit students and employers.

There have been some difficulties during the year getting some students back on track to achieve their target outcomes, some of which have been affected by circumstances in company where apprentices have been away from the workplace for long periods, the teams have been working with companies to alleviate these delays, as such some of the ESFA income has been delayed in the year. Apprentice recruitment has seen a recovery in the year as some confidence is shown by companies.

We continue to deliver a wide range of training initiatives to meet our customer demands across apprenticeships, adult skills and health and safety at recognised national and international standards. The courses are delivered across the UK and overseas as required and to a customer base ranging from small to national organisations. The commercial engineering and health & safety have both shown a continuation of the recovery from the previous year.

Despite some difficulties in the year, targets set by the board and management team have generally been achieved, initiatives to continue the development of the business are continually reviewed through strategic discussion at planned board meetings, although there has been a loss of £44,000 in the year, much of this has been attributed to a much needed, and planned, roof refurbishment.

I thank our stakeholders, Board Members, Chief Executive, Senior Management Team and all the hardworking staff who make it a privilege to chair SETA and their commitment to the success of the organisation, as we provide the education training and support to our clients and their employees.

After the years activity there has been a full Ofsted inspection of the organisation which has led to serious consequences for the business. A note in this respect has been added to the post balance sheet event note below as well as the notes to the accounts page.

Our purpose and activities

The principal objective of the Charity is to maintain, improve and advance education by promoting the training and education for employed people and those intending to be employed in industry and commerce as shown in the Memorandum and Articles of the Association.

The Charity does not carry out significant fundraising activities, the main income for the Charity is via Government funded Apprenticeship training which is supported by commercial training activities.

1

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Public Benefit

The Trustees confirm that they have, when and where necessary to do so, paid regard to the Charity Commissioner’s Guidance on Public Benefit when considering and making its decisions.

SETA is ideally placed to offer its funded services to the whole of the Greater Manchester and surrounding catchment area.

Membership

We currently have 19 member companies.

Apprentice Training

The number of apprentice starts for the year continued to recover after the Covid-19 pandemic for both Levy and non-Levy funded apprentices in the year.

Apprentice Training is one of the Charity's main sources of income. This relies on the Charity's recruitment of apprentices for member companies and clients. Recruitment - initial assessment, interviewing and selection of young people on behalf of the Association's members and clients is undertaken to support their criteria for

Non-Charitable Activities

These are done to support charitable activities and to provide members with services required.

Adult Engineering Training

Adult Skills programmes tailored to suit the employing company's needs continue to grow in today's environment of multi-skilled workforces. Many are still using the NVQ system to gain formal qualifications of their competences. We will respond to the needs of companies investing in workforce development via purpose designed programmes. Contacts with the newly created Skills Academies should assist in the marketing and delivering of core skills for which there is a regular and potentially larger market.

New opportunies continue to be monitored, this included continuing the delivery of the 18th Edition Electrical course that is still proving very popular.

We have also added TWI accredited Welding courses that will strengthen our offer in this area.

Safety and Short Courses

Health, safety and environment related courses for industry and commerce are in constant demand throughout the UK, European and the Middle East.

SETA has responded to this and has set up SETA International to grow links with partners in these areas, particularly in Cyprus, Greece, Turkey, Africa and Eastern Europe. E-portfolio - NVQ Level 5 in Occupational Health and Safety practice is still increasing in numbers.

2

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Achievements, Performance and Covid-19

2021/22 continued to see an improvement on Apprentice starts and we also saw a resurgence in commercial courses. An increased budget was set from the previous year.

SETA also continued to utilise the Coronavirus Job Retention Scheme to partially Furlough staff where we could not justify full time work, this was reviewed on a weekly basis.

Commercial courses continued to pick up and all departments exceeded their budgets for the year.

Apprenticeship starts continued to improve, reaching 102 by the end of the year, compared to 30 (2021) and 97 (2020).

Covid-19 did continue to have an impact on learners dropping off programme and the delay in completing programmes also impacted on.

The number of learners starting standalone NVQ's paid directly by their employers increased slightly from 10 to 11 this year.

Demand for the Level 4 Higher National Certificate (HNC) in Engineering dropped slightly with 19 commencing year one and 25 returning to complete year two. This is a natural progression for Apprentices after achieving the Level 3 National Certificate and is a full commercial charge to employers.

We are still looking to expand to HND over the next couple of years.

3

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Financial Review

The principal funding sources for Stockport Engineering Training Association Ltd are received from the Educations and Skills Funding Agency for funded apprenticeships. This is supplemented via employer contributions, where they require training over and above the framework/Standard or the learner only qualifies for part funding. This area continued to be affected by Covid-19 with a number of learners struggling to complete their apprenticeships on time, this impacted on completion payments and ESFA income was down by £246,000 for the year when compared to budget.

This funding is supported by other training income being generated through the charity's subsidiary trading companies, these allow us to operate in other markets that would not normally be accessible to the charity. These include:

All profits from the commercial training will be gift-aided back to the Charity to aid it in fulfilling its charitable aims, £185,288 has been gift aided in 2022 (£192,351 in 2021).

The financial result for the period was a net decrease in funds of £43,939 (2021: decrease £38,720).

As disclosed in last years accounts, during January and February 2021 it became apparent that the main roof of the workshop was deteriorating faster than anticipated and running repairs were no longer an option. Even though it was not included in the budget, it was agreed that a full replacement was required. Quotes were obtained and the contract was awarded to Practical Roofing Solutions at a cost of £95,000, with staged payments. Work commenced in June 2021 but completion was delayed until this year and these financial statements include £33,000 of that expenditure.

Income increased by £185,366 (£115,000 down on budget). However, after claims from the Government's CJRS furlough scheme, dropped from £98,543 to £7,621, the net impact on the accounts was only an increase of £94,444. Due to the additional roof repair costs above, expenditure was only under the original budget by £36,000. This had the result of reducing the budgeted profit of £15,000 to a loss of £61,230.

The Board feel that the main building at Hammond Avenue, Stockport has increased in value during the year and have performed a desktop comparison. Based on these findings they have revalued it in the year with an increase to £1,400,000 from £1,245,000.

The effect is that our consolidated balance sheet still shows a strong picture with net current assets of £56,717 compared to £129,186 (2021) and total funds of £1,067,549 compared to £956,488 (2021).

Budgets had been set for the next year as: Year 2023 Turnover £2,180,000 Expenditure £2,095,800

Post Balance Sheet Events

4

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

SETA underwent an Ofsted inspection from 13-16 September 2022 and due to some of the findings during the inspection they assessed the overall effectiveness of SETA as unsatisfactory. Despite disagreeing with some of the points made we were not successful in changing the grading and on 9 November 2022 the report was made public.

As per apprenticeship funding rules for main providers, the Education and Skills Funding Agency (ESFA) indicated their intention to terminate their contract with SETA and to remove us from the Register of Apprenticeship Training Providers (RoATP). SETA appealed this decision by submitting a mitigation case to the ESFA but on 7 December 2022 the ESFA notified us that the appeal had been unsuccessful and of their intention to remove SETA's apprenticeship delivery as from 7 March 2023.

We had been informed that we would be allowed a "run-out" contract for any learners where the employer still wanted SETA to complete their apprenticeship. On 19 December we were then informed that the ESFA's stance had changed and this was no longer an option, subsequently all learners must be removed as from 7 March 2023.

ESFA funding amounted to 47% of income levels in 2022 plus additional training linked to apprentice training.

The Main Board and Operational Board explored all the options available to them to ensure:

An agreement was made that as from 1 March 2023, SETA would transfer all apprentices and commercial engineering training courses to a local training provider (Elevated Knowledge Limited). As part of the agreement they would lease a large proportion of SETA's training centre and take over the majority of staff and equipment.

This would allow SETA to continue to support its Charitable aims of still assisting the advancement of education whilst it concentrated on the delivery of Health and Safety training.

5

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Reserves Policy

Reserves are needed to bridge the gap between the spending and receiving of income and to cover unplanned emergency repairs and other expenditure. The trustees consider that the ideal level of reserves as at 31st July 2022 would equate to between 3 and 6 months of non-course related expenditure. Three months being £342,000 based on 2022 levels. The trustees consider that this level of reserves would ensure that, given a significant drop in funding, they would be able to continue the Charity's current activities whilst alternate plans were implemented.

The Charities total reserves were £1,067,549 as at 31 July 2022. The free reserves, being those unrestricted funds not represented by fixed assets and their associated finance, were (£989) at 31 July 2022 (£49,443 in 2021), a decrease of £50,432.

We aim to bring these up to an ideal level over the next five years.

We consistently plan and monitor the financial performance of the charity in order to maintain reserve levels by:

Investments Held

The investments held by the charity are share capital held in its two subsidiary companies:

Plans for future periods

Our future plans are detailed in our business development plan. A concerted effort is being made to promote all SETA courses to existing clients and member companies.

Plans now include concentrating on commercial income along with rental of the training centre to further our charitable aims.

6

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Reference and administrative details

Company Number: 1512311

Charity Number: 510493

Registered Office:

18 Hammond Avenue Whitehill Industrial Estate South Reddish Stockport SK4 1PQ

Bankers

The Royal Bank of Scotland Plc 1 Great Underbank Stockport SK1 1LN

Auditors

DJH Mitten Clarke Audit Limited Chartered Accountants and Statutory Auditors St George’s House 56 Peter Street Manchester M2 3NQ

Directors and Trustees

The directors of the charitable company (the charity) are its trustees for the purpose of Charity Law. The trustees and officers serving during the year and since the year end were as follows:

Mr R G Howarth (Chairman) Mr J R Moss (Treasurer) Dr Moray Kidd - appointment terminated 28 December 2022 Mr N Carne - appointment terminated 28 December 2022

Company Secretary: Mr M C Field

Key management personnel:

Chief Executive Mr R M Prince (employment ceased 31 May 2023) Financial Director Mr M C Field External Operations Director Mrs J Burns Internal Operations Director Mr M Neild Quality Director Mr L Johnson

7

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Structure, Governance and Management

Governing Document

The charity is controlled by its memorandum and articles of association and constitutes a limited company, limited by guarantee as deemed by the Companies Act 2006.

Recruitment and Appointment of New Directors and Trustees

The Directors of the Company are elected annually at the Company's Annual General Meeting. At each Annual General Meeting one third of the Elected Board Members for the time being, or if their number is not a multiple of three then the nearest one third, retires from office. If there is only one Elected Board Member who is subject to retirement by rotation, he/she retires. The Elected Board Members who are to retire in every year are those who have been longest in office since their last election or appointment, but as between persons who became Elected Board Members on the same day those to retire (unless they otherwise agree among themselves) are deemed by lot. A retiring Board Member is eligible for re-election, but does not serve more than three consecutive three year terms or, in the case of an Officer, two consecutive three year terms. Each Trustee is elected and voted into office by the members and office of Chairman, Deputy and Treasurer similarly elected. The Association is a member led organisation and the Trustees are mindful of meeting their needs. Currently there are five Trustees, all holding non-executive office and meet formally every four

Induction and Training of Directors and Trustees

New Directors and Trustees are given training upon election, subject to their existing skills and knowledge. A tailored programme of training takes place for each new Director and Trustee. It provides trustees with suitable and sufficient help and guidance on how the Charity works.

Organisational Structure

Overall responsibility for the Charity's strategy and direction rests with the Board of Management, which comprises all Directors. The carrying out of day to day activities is delegated to the staff under the management of the Chief Executive. There are no specific significant restrictions regarding the way the Charity can operate.

The Charity's decisions are ultimately made by the Board of Directors, there are bi-monthly meetings when discussions take place and decisions are then filtered down to the staff concerned by their line managers.

Subsidiaries

The Charity has two trading subsidiaries, SETA Training & Advisory Services Ltd and SETA Training (Cyprus) Ltd whose accounts are reported separately, and are consolidated into these accounts.

Both these companies were set up to perform trading activities to provide funds for the charity. As stated in the notes SETA TraTra ining andand AdvisoryAdvisory ServicesServices Ltdmademadea profita profitof £75of £185,739and SETAbeforeTrainingdistributions(Cyprus)andLimitedSETAa loss of £4,433.Training (Cyprus) Limited a small loss of £436.

Pay policy for senior staff

Decisions on management remuneration levels are made by the Chief Executive taking into account the job role, peer group salary evaluations, appraisals and advice from the Financial Accountant.

The Chief Executives remuneration is ultimately set by the Board.

8

Stockport Engineering Training Association Limited Report of the Trustees for the year ended 31 July 2022

Risk Management

The Trustees have a duty to identify and review the risks to which the Charity is exposed and to ensure appropriate controls are in place to provide reasonable assurance against fraud and error.

The Board has carried out a review of the major risks to which the Charity is exposed and has put in place controls and activities to mitigate those risks which are within their control to influence.

Trustees' responsibilities in relation to the financial statements

The trustees (who are also the directors of Stockport Engineering Training Association Limited for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

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

• select suitable accounting policies and then apply them consistently;

• observe the methods and principles in the Charity SORP;

• make judgements and estimates that are reasonable and prudent;

• state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.

The trustees are responsible for maintaining proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement as to disclosure to our auditors

In so far as the trustees are aware at the time of approving our trustees’ annual report:

●there is no relevant information, being information needed by the auditor in connection with preparing their report, of which the group’s auditor is unaware, and

●the trustees, having made enquiries of fellow directors and the group’s auditor that they ought to have individually taken, have each taken all steps that he/she is obliged to take as a director in order to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

By order of the Board of Trustees

Mr. R G Howarth Chairman

Date: 24th July 2023

9

Stockport Engineering Training Association Limited Report of the Independent Auditors to the Trustees of Stockport Engineering Training Association Limited

Opinion

We have audited the financial statements of Stockport Engineering Training Association Limited (which comprises the Group and Parent Charitable Company) for the year ended 31 July 2022 which comprise the consolidated statement of financial activities, the consolidated and charity balance sheet, the consolidated and charity statement of cashflows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

· give a true and fair view of the state of the group and parent charitable company’s affairs as at 31 July 2022 and of its incoming resources and application of resources for the year then ended;

· have been prepared in accordance with the requirements of the Companies Act 2006 and Charities Act 2011.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under those standards are further described in the Auditors’ 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 statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director'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 doubt on the entity's ability to continue as a going concern for a period of at least 12 months from when the financial statements are authorised for issue.

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

Other information

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

10

Stockport Engineering Training Association Limited Report of the Independent Auditors to the Trustees of Stockport Engineering Training Association Limited

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by exception

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

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities Act 2011 requires us to report to you if, in our opinion:

Responsibilities of Trustees

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

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

Auditor’s responsibilities for the audit of the financial statements

The trustees have elected for the financial statements to be audited in accordance with the Charities Act 2011 rather than the Companies Act 2006. Accordingly, we have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.

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

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

11

Stockport Engineering Training Association Limited Report of the Independent Auditors to the Trustees of Stockport Engineering Training Association Limited

In preparation for our audit we identified areas of laws and regulations which we considered could have a material effect on the financial statements. This information was obtained via discussions with management and from our general commercial and sector experience.The trustees also provide us with written representation of all the key and fundamental industry specific laws and regulations with they are required to adhere to. These were then communicated to the whole of the audit team at our audit planning meeting.

As a charitable company providing training and education, non-compliance with the Charities Act 2011, Companies Act 2006 and industry specific regulations of Ofsted and the Education & Skills Funding Agency were assessed to be most relevant. Our audit procedures to respond to these risks included:

Despite appropriate planning and performing our work in accordance with International Auditing Standards, there are always inherent limitations that non-compliance is not detected. Non-compliance with laws and regulations is often further removed from the events and transactions reflected in the financial statements and material misstatements due to fraud can be deliberately concealed from auditors, for example through misrepresentation, forgery or collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities.

This description forms part of our auditor's report.

Use of our report

This report is made solely to the Group and Charitable Company’s trustees, as a body, in accordance with Section 144 of the Charities Act 2011 and regulations made under Section 154 of that Act. Our audit work has been undertaken so that we might state to the charitable company’s trustees those matters we are required to state to them in an auditors’ report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

DJH Mitten Clarke Audit Limited Chartered Accountants and Statutory Auditors

St George’s House

56 Peter Street Manchester M2 3NQ

Date: 24 July 2023

12

Stockport Engineering Training Association Limited Consolidated Statement of Financial Activities (Incorporating a Consolidated Income and Expenditure Account) for the year ended 31 July 2022

Unrestricted
Funds
£
Notes
INCOME
Donations and legacies
3
7,621
Income from trading activities
4
722,146
Investment income
4
74
Income from charitable activities:
5
1,059,155
Total income
1,788,996
EXPENDITURE
Expenditure on raising funds
6
677,517
Expenditure on charitable activities
7
1,155,418
Total Expenditure
1,832,935
NET EXPENDITURE
(43,939)
Gains/(Losses) on revaluation of Fixed Assets
155,000
Net movement of funds for the year
111,061
RECONCILIATION OF FUNDS
Total funds brought forward
956,488
Funds balances carried forward
1,067,549		 Restricted
Funds
£
-
-
-
-
-
-
-
-
-
-
-
-		 Total
Total
2022
2021
£
£
7,621
98,543
722,146
655,963
74
16
1,059,155
940,030
1,788,996
1,694,552
677,517
627,084
1,155,418
1,106,188
1,832,935
1,733,272
(43,939)
(38,720)
155,000
463,000
111,061
424,280
956,488
532,208
1,067,549
956,488

13

Stockport Engineering Training Association Limited Consolidated Balance Sheet as at 31 July 2022

Notes
FIXED ASSETS
Tangible assets
12
CURRENT ASSETS
Stocks
14
Debtors
15
Cash at bank and in hand
CREDITORS
Amounts falling due within one
year
16
NET CURRENT ASSETS
TOTAL ASSETS LESS
CURRENT LIABILITIES
CREDITORS
Amounts falling due after more
than one year
17
NET ASSETS
FUNDS
General funds
20
TOTAL FUNDS		 20,942
326,227
155,526		 2022
2021
£
£
1,521,043
1,376,754
15,170
317,583
152,546
485,299

(356,113)
56,717
129,186
1,577,760
1,505,940
(510,211)
(549,452)
1,067,549
956,488
1,067,549
956,488
1,067,549
956,488
502,695
(445,978)

14

Stockport Engineering Training Association Limited Consolidated Balance Sheet as at 31 July 2022

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 July 2022

.

The directors acknowledge their responsibilities for: The members have not deposited notice, pursuant to Section 476 of the Companies Act 2006 requiring an audit of these financial statements.

The trustees acknowledge their responsibility for

(a) ensuring that the charitable company keeps accounting records that comply with Sections 386 and 387 of the Companies Act 2006; and

(b) preparing financial statements which give a true and fair view of the state of affairs of the charitable company as at the end of each financial year and of its surplus or deficit for each financial year in accordance with the requirements of Section 394 and 395 and which otherwise comply with the requirements of any Companies Act 2006 relating to financial statements, so far as applicable to the charitable company.

These financial statements have been audited under the requirements of section 144 of the Charities Act 2011.

These financial statements have been prepared in accordance with the Companies Act 2006 and with the Financial Reporting standard applicable in the UK and Republic of Ireland (FRS 102).

The financial statements were approved by the board of Trustees on 24th July 2023 and were signed on its behalf by:

Mr. R G Howarth Chairman

15

Stockport Engineering Training Association Limited Charity Balance Sheet as at 31 July 2022

Notes
FIXED ASSETS
Tangible assets
12
Investments
13
CURRENT ASSETS
Debtors
15
Cash at bank and in hand
CREDITORS
Amounts falling due within one
year
16
NET CURRENT LIABILITIES
TOTAL ASSETS LESS
CURRENT LIABILITIES
CREDITORS
Amounts falling due after more
than one year
17
NET ASSETS
FUNDS
Restricted funds
General funds
TOTAL FUNDS		 95,727
6,776		 2022
2021
£
£
1,521,043
1,376,754
1,839
1,853
1,522,882
1,378,607
131,172
30,784
161,956

(109,163)
(19,617)
52,793
1,503,265
1,431,400
(510,211)
(549,452)
993,054
881,948
-
-
993,054
881,948
993,054
881,948
102,503
(122,120)

16

Stockport Engineering Training Association Limited Charity Balance Sheet as at 31 July 2022

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 July 2022.

The members have not deposited notice, pursuant to Section 476 of the Companies Act 2006 requiring an audit of these financial statements.

The trustees acknowledge their responsibility for:

(a) ensuring that the charitable company keeps accounting records that comply with Sections 386 and 387 of the Companies Act 2006; and

(b) preparing financial statements which give a true and fair view of the state of affairs of the charitable company as at the end of each financial year and of its surplus or deficit for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the charitable company.

These financial statements have been audited under the requirements of section 144 of the Charities Act 2011.

These financial statements have been prepared in accordance with the Companies Act 2006 and with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).

The financial statements were approved by the board of Trustees on 24th July 2023 and were signed on its behalf by:

Mr. R G Howarth Chairman

17

Stockport Engineering Training Association Limited Statement of Cash Flows and Consolidated Statement of Cash Flows for the year ended 31 July 2022

for the year ended 31 July 2022
Cash used in operating activities
24
Cash flows from investing activities
Interest Income
Purchase of tangible fixed assets
Cash used in investing activites
Cash flows from financing activites
Increase (repayment) of borrowing
Cash used in financing activites
Increase/(decrease) in cash and cash equivalents
in the year
Cash and cash equivalents at the beginning of the year
Total cash and cash equivalents at the end
of the year		 Group
2022
£		 Group
2021
£		 Charity
2022
£		 Charity
2021
£
70,027 (74,493) 43,113 (106,001)
74
(27,880)		 16
(15,875)		 -
(27,880)		 3
(15,875)
(27,806) (15,859) (27,880) (15,872)
(39,241) 79,824 (39,241) 79,824
(39,241) 79,824 (39,241) 79,824
2,980 (10,528) (24,008) (42,049)
152,546 163,074 30,784 72,833
155,526 152,546 6,776 30,784

18

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

1 ACCOUNTING POLICIES

Basis of preparation of accounts

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective January 2019) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Stockport Engineering Training Association Limited meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s) and with the exception of investments which are included at market value.

Preparation of the accounts on a going concern basis

The Trustees believe it is appropriate to prepare the accounts of the Charity on a going concern basis.

As per the post balance sheet event disclosure in note 25, ESFA funding ceased in March 2023. The trustees have planned for this eventuality and have ensured that plans are in place for the continuation of the charity without it. The trustees are also satisfied that the change in activities continue to support the charity's objects to assisting the advancement of education.

19

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

Group financial statements

The consolidated accounts incorporate the results of Stockport Engineering Training Association Limited (‘the Charity’) and its subsidiary undertakings; SETA Training & Advisory Services Limited and SETA Training (Cyprus) Limited; on a line-by-line basis.

The consolidated entity is referred to as ‘the Group’. No separate company Statement of Financial Activities (SOFA) has been prepared for the Charity as permitted by section 408 of the Companies Act

Income

Income is included in the SOFA when the charity is entitled to the income and when it is probable that income will be received and the amount can be measured reliably. Donations in kind are recognised at their value to the charity when they are received. No amounts are included for services donated by volunteers.

Income comprise:
Donations and legacies
Legacies Pecuniary legacies are recognised as receivable once probate has
been granted and notification has been received.
Residuary legacies are recognised as receivable once probate has
been granted, provided that sufficient information has been
received to enable valuation of the Charity’s entitlement.
Donations Donations are accounted for as they are received.
Gift Aid Gift Aid is included based on amounts recovered or recoverable at
the accounting date.
Activities for raising funds
Membership subscription Membership subscription income (which is not considered to be
donations) is accounted for on an accrual basis.
Engineering training Income from providing training and courses are accounted for on
an accrual basis.
Safety training Income from providing training and courses are accounted for on
an accrual basis.
Schools training Income from providing training and courses are accounted for on
an accrual basis.
Investment income Investment income is accounted for on an accrual basis.
Income from charitable activities
Apprentice training – Government funding is recognised when the Charity is entitled to
Government funded receipt on an accrual basis.
Apprentice training – Income is recognised when the Charity is entitled to receipt on an
Other funded accrual basis.
members services Income from providing training and courses are accounted for on
an accrual basis.
Government Grant Income Coronavirus Job Retention Scheme Furlough income is claimed
and accounted for in the month that it relates to. The scheme
ended in September 2021.

Expenditure and basis of allocation

20

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

Expenditure is accounted for on an accruals basis. Overheads and other costs not directly attributable to a particular charitable activity category are apportioned over the relevant on the basis of management estimates attributable to that activity in the year, which is calculated as follows:

Administrative expenses (Staff Time) 2022 2021
% %
Engineering training income 6.9 6.5
Safety and short courses 16.3 15.2
Apprentice training 47.5 47.3
Non-Government funded apprentices 12.4 12.1
Schools/Study Programme Training - 3.4
Services to members 1.6 -
Governance 15.3 15.5
Training Centre expenses (Staff Time) 2022 2021
% %
Engineering training income 25.1 16.6
Apprentice training 57.1 64.0
Non-Government funded apprentices 14.8 13.8
Schools/Study Programme Training - 5.6
Services to members 3.0 -
Governance - -
Short Course expenses (Staff Time) 2022 2021
% %
Safety and short courses 100.0 100.0
Apprentice training - -
Non-Government funded apprentices - -
Schools/Study Programme Training - -
Services to members - -
Group Services expenses (Staff Time) 2022 2021
% %
Engineering training income 3.4 3.2
Safety and short courses 4.3 2.8
Apprentice training 79.1 80.4
Non-Government funded apprentices 8.9 8.2
Schools/Study Programme Training - 1.6
Services to members 2.0 -
Governance 2.3 3.8
Canteen expenses (Delegate Numbers) 2022 2021
% %
Engineering training income 49.5 39.5
Safety and short courses 50.5 60.5
Apprentice training - -

21

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

Premises expenses (Floor Area) 2022 2021
% %
Engineering training income 29.8 28.4
Safety and short courses 15.3 13.3
Apprentice training-Government funded 17.9 12.3
Apprentice training-Other funded 24.5 27.0
Schools/Study Programme Training - 10.5
Services to members 4.0 -
Governance 8.5 8.5

Governance costs

Governance costs comprises the expenditure on governance of the charity including audit fees, legal advice for trustees, costs of trustee meetings and an apportionment of relevant staff costs based on time spent on governance-related matters.

Leasing and hire purchase commitments

Assets held under finance leases and hire purchase contracts are capitalised in the balance sheet. The assets are depreciated over their expected useful lives.

Rentals under operating leases are charged to the statement of financial activities as they fall due.

Pension costs

The company operates a defined contribution pension scheme for the present employees. Contributions are charged to the SOFA as they become payable in accordance with the rules of the scheme

Tangible fixed assets and depreciation

All fixed assets are held for charitable use and are stated at cost less depreciation with all repairs written off as occurred.

Land and buildings are held at market value. Land and buildings are revalued regularly to ensure the carrying value is not materially different from a fair value at the end of the reporting period.

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

Freehold Property 2% straight line Motor Vehicles 25% reducing balance Plant and Machinery 15% reducing balance Computer Equipment 20% straight line Office Equipment 25% reducing balance

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. Cost is calculated using the first-in first-out basis of valuation.

Investments

Subsidiary companies are valued at cost, with any resulting gains or losses on exchange included in the SOFA.

22

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

Taxation

The activities of the Charity are exempt from corporation taxation under section 505 of the Income and Corporation Taxes Act 1988 to the extent that they are applied to the organisation’s charitable objectives.

The trading subsidiaries do not generally pay UK corporation tax because their policy is to pay taxable profits as Gift Aid to the Charity. Foreign tax incurred by overseas subsidiaries is charged as it is incurred.

Funds

Unrestricted funds are funds which can be used in accordance with the charitable objects at the discretion of the trustees.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the charity for particular purposes. The cost of raising and administering such funds is charged against the specific fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

Investment income and gains are allocated to the appropriate fund.

Foreign currencies

Transactions in foreign currencies are recorded at the rate of exchange prevailing at the date of the transaction. Foreign currency balances are translated into sterling at the exchange rates prevailing at the balance sheet date. Any resulting gains or losses on exchange are included in the SOFA.

Profits and losses of foreign subsidiaries are translated to sterling at average rates of exchange. The opening net assets and profit and loss accounts of those subsidiaries are retranslated to year end rates; exchange differences arising on the retranslation are taken to reserves.

Debtors

Debtors are normally recognised at their transaction price, provision for Bad Debts has been included for the year.

Creditors and Provisions

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

23

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

2 FINANCIAL PERFOMANCE OF THE CHARITY

The charity is a company limited by guarantee and has no share capital. The liability of each member in the event of winding-up is limited to £1. The Consolidated Statement of Financial Activities is for the Group as a whole. The figures below are the equivalent figures for the Charity only, excluding other Group companies.

Income
Gift aid from the subsidiary company
Expenditure on charitable activities
Governance costs
Gains/(Losses) on revaluation of Fixed Assets
Net movement in funds
Total funds brought forward
Total funds carried forward
Funds
Unrestricted funds
DONATIONS AND LEGACIES
Unrestricted
Funds
£
Donations
2,185
Government Grant Income
5,436
7,621
INCOME FROM OTHER TRADING ACTIVITIES
Unrestricted
Funds
£
Other trading activities
Membership subscriptions
3,027
Engineering training income
236,114
Safety and short courses
483,005
Schools/Study Programme Training
-
722,146
Investment income
Interest on cash deposits
74		 Restricted
Funds
£
-
-
-
Restricted
Funds
£
-
-
-
-
-
-		 2022
£
741,785
185,288
927,073
(825,207)
(145,760)
155,000
(815,967)
111,106
881,948
993,054
993,054
993,054
2022
Total
£
2,185
5,436
7,621
2022
Total
£
3,027
236,114
483,005
-
722,146
74		 2021
£
794,457
122,874
917,331
(867,053)
(157,545)
463,000
(561,598)
355,733
526,215
881,948
881,948
881,948
2021
Total
£
-
98,543
98,543
2021
Total
£
3,089
190,115
390,159
72,600
655,963
16

3 DONATIONS AND LEGACIES

4

24

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

5
INCOME FROM CHARITABLE ACTIVITIES
Unrestricted
Funds
£
Apprentice training-Government
funded
833,617
Apprentice training-Other funded
194,025
Members services
31,513
1,059,155
6
EXPENDITURE ON RAISING FUNDS
Unrestricted
Funds
£
Engineering training
Marketing
8,353
Staff costs
105,535
Training costs
31,532
Travel
7,050
Premises costs
44,702
Office and sundry costs
18,346
Depreciation
8,512
224,030
Safety and short courses
Marketing
45,517
Staff costs
218,679
Training costs
117,164
Travel
21,052
Premises costs
22,970
Office and sundry costs
23,706
Depreciation
4,399
453,487
Schools/Study Programme Training
Marketing
-
Staff costs
-
Training costs
-
Premises costs
-
Office and sundry costs
-
Depreciation
-
-
TOTAL
677,517		 Restricted
Funds
£
-
-
-
Restricted
Funds
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-		 2022
Total
£
833,617
194,025
31,513
1,059,155
2022
Total
£
8,353
105,535
31,532
7,050
44,702
18,346
8,512
224,030
45,517
218,679
117,164
21,052
22,970
23,706
4,399
453,487
-
-
-
-
-
-
-
677,517		 2021
Total
£
761,839
177,254
937
940,030
2021
Total
£
6,487
78,736
18,569
7,643
47,061
14,983
13,027
186,506
9,530
204,444
95,068
20,549
22,072
22,576
7,288
381,527
-
30,694
2,667
17,460
3,917
4,313
59,051
627,084

25

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

7
EXPENDITURE ON CHARITABLE ACTIVITIES
Unrestricted
Funds
£
Apprentice training-government funded
Marketing
5,146
Staff costs
598,713
Training costs
111,169
Travel
9,264
Premises costs
26,906
Office and sundry costs
33,368
Depreciation
5,379
789,945
Apprentice training-Other funded
Marketing
-
Staff costs
112,239
Training costs
11,419
Premises costs
36,812
Office and sundry costs
6,018
Depreciation
6,143
172,631
Member services
Marketing
-
Staff costs
20,812
Training costs
2,344
Premises costs
5,979
Office and sundry costs
994
Depreciation
998
31,127
Governance costs (note 7)
161,715
TOTAL
1,155,418
8
GOVERNANCE COSTS
Unrestricted
Funds
£
Marketing
110
Staff costs
57,755
Training costs
4,258
Travel
5,170
Premises costs
12,761
Office and sundry costs
69,594
Depreciation
12,067
161,715		 Restricted
Funds
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Restricted
Funds
£
-
-
-
-
-
-
-
-		 2022
Total
£
5,146
598,713
111,169
9,264
26,906
33,368
5,379
789,945
112,239
11,419
36,812
6,018
6,143
172,631
-
20,812
2,344
5,979
994
998
31,127
161,715
1,155,418
2022
Total
£
110
57,755
4,258
5,170
12,761
69,594
12,067
161,715		 2021
Total
£
6,659
612,135
75,597
7,456
20,398
35,312
6,575
764,132
-
102,465
6,756
44,860
4,840
11,080
170,001
-
-
-
-
-
-
-
172,055
1,106,188
2021
Total
£
298
62,244
3,113
4,669
14,106
70,363
17,262
172,055

26

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

9
NET RESOURCES EXPENDED BEFORE TRANSFERS
This is stated after charging:
Depreciation
Directors' remuneration
Pension costs
Auditors' remuneration
10
TRUSTEES' REMUNERATION AND BENEFITS
Total remuneration paid to trustees’ amounted to:
R.G Howarth
£1,500
(2021 £1,500)
J. R. Moss
£1,500
(2021 £1,500)
M. Kidd
£1,500
(2021 £750)
Total
£4,500
(2021 £3,750)		 2022
2021
£
£
37,499
59,545
64,617
63,518
33,492
32,367
11,681
10,248

This has been agreed with the Charities Commission due to the additional time involved in being a Director of the Trading subsidiary company SETA Training and Advisory Services Limited

There were no trustees’ expenses or other benefits for the year ended 31 July 2022 nor for the year ended 31 July 2021.

11
STAFF COSTS
Staff costs during the year amounted to:
Wages and salaries
Social security costs
Pension costs
The average number of employees during the year,
including full time equivalents of part time employees, was:
Apprentice training-government funded
Members services
Engineering training
Safety and short courses
Governance		 2022
2021
£
£
984,196
949,435
92,611
92,612
33,492
32,367
1,110,299
1,074,414
11
12
-
1
9
8
4
4
7
7
31
32

The employees performed training, administrative and management functions.

The above includes holiday pay accrual amounting to £27,030 (2021 £26,805)

The emoluments of one member of staff, including benefits in kind, is within the range £60,000 to £69,999 (2021 - One), not including retirement benefits which are accruing under a money purchase scheme.

The key management personnel of the group comprise those of the charity, being the trustees, the chief executive and the company secretary. The total employee benefits of the key management personnel of the group were £130,793 (2021: £131,281).

The number of employees to whom retirement benefits were accruing was 36 (2021: 34)

27

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

12 TANGIBLE FIXED ASSETS - GROUP

Cost or valuation
At 1 August 2021
Additions
Deficit on revaluation
Disposals
At 31 July 2022
Depreciation
At 1 August 2021
Charge for the year
On disposals
At 31 July 2022
Net book value
At 31 July 2022
At 31 July 2021		 Land and
buildings
£
1,245,000
155,000
-
1,400,000
-
-
-
-
1,400,000
1,245,000		 Plant and
machinery etc
£
247,423
27,880
-
(26,141)
249,162
174,599
22,767
(25,049)
172,317
76,845
72,824		 Motor
vehicles
Total
£
£
209,432
1,701,855
-
27,880
155,000
-
(26,141)
209,432
1,858,594
150,502
325,101
14,732
37,499
-
(25,049)
165,234
337,551
44,198
1,521,043
58,930
1,376,754

All fixed assets held are used for direct charitable purposes.

Except under an order of the registrar, no deposition by the proprietor of the land is to be registered without the consent of the proprietor of the Charge in favour of the Royal Bank of Scotland Plc. referred to in the Charges Register.

If the freehold land and building had not been revalued they would have been included at the following historical cost:

Historical cost
Aggregate depreciation
At 31 July 2022		 2022
£
702,356
(258,489)
443,867

The fair value of the freehold land and buildings has been determined by the trustees of the charity on an open market value for existing use basis. The valuation has been based on a desktop comparison exercise between the land and buildings owned by the charity to similar sized properties in close geographical proximity.

Cost or valuation at 31 July 2022 is represented by:

Historical cost
Revaluation 2006
Revaluation 2011
Revaluation 2017
Revaluation 2021
Revaluation 2022
At 31 July 2022		 Land and
Buildings
£
702,356
555,825
(495,858)
87,677
395,000
155,000
1,400,000

28

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

13 INVESTMENTS - COMPANY

Cost
At 1 August 2021
Movement
At 31 July 2022
Net book value
31 July 2022
31 July 2021		 Unlisted
investment
£
1,853
(14)
1,839
1,839
1,853

The company's investments at the balance sheet date in the share capital of companies include the following:

Country of Class of
Subsidiary Undertaking Incorporation Shares % Held
SETA Training and Advisory Services Limited England Ordinary 100%
SETA Training (Cyprus) Limited Cyprus Ordinary 100%
SETA International Limited England Ordinary 99.8%

SETA Training and Advisory Services Limited (Incorporated in England and Wales)

Nature of business: Providing training for people employed or intending to be employed in industry and commerce.

%
Class of shares:
holding
Ordinary shares of £1 each
100.00
Turnover
Cost of sales and administration costs
Interest receivable
Interest payable
Tax
Net Profit
Amount gift aided to the charity
Retained in subsidiary		 Company Number: 03001863
2022
2021
£
£
1,044,512
898,371
(858,845)
(706,033)
72
13
185,739
192,351
(185,288)
(122,874)
451
69,477		 Company Number: 03001863
2022
2021
£
£
1,044,512
898,371
(858,845)
(706,033)
72
13
185,739
192,351
(185,288)
(122,874)
451
69,477
192,351
(122,874)
69,477

29

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

SETA Training (Cyprus) Limited (Incorporated in Cyprus)

Nature of business: Providing health and safety courses industry and commerce.

%
Class of shares:
holding
Ordinary shares of £1 each
100.00
Aggregate capital and reserves
Profit/(Loss) for the period		 Company Number: 224453
2022
2021
£
£
4,106
4,616
(436)
(682)

The consolidated statement of financial activities includes the results of the charity's wholly owned subsidiaries. The summary financial performance of SETA Training (Cyprus) Limited alone is:

2022 2021
£ £
Turnover 15,060 1,711
Cost of sales and administration costs (15,101) (2,393)
Interest receivable
Corporation Tax (395)
Net Profit (436) (682)
Amount gift aided to the charity - -
Retained in subsidiary (436) (682)
SETA International Limited (Incorporated in England and Wales)
Nature of business: Dormant
%
Class of shares: holding Company Number: 9992870
Ordinary shares of £1 each 99.80
2022
£
Aggregate capital and reserves 1,000
Profit/(Loss) for the period -
Centre materials
Registrations
Canteen
Stationery
Cleaning Materials
Course Books		 Group
2022
10,418
2,554
542
980
176
6,272
20,942		 Group
2021
£
9,168
900
257
613
173
4,059
15,170		 Charity
Charity
2022
2021
£
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-

14 STOCK

30

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

15 DEBTORS

DEBTORS
Trade debtors
Government funding receivable		 Group
2022
£
200,618
64,903
-
54,207
6,499
326,227		 Group
2021
£
124,884
104,282
2,423
79,282
6,712
317,583		 Charity
Charity
2022
2021
£
£
19,346
3,007
64,903
104,282
3,562
10,275
1,823
7,301
6,093
6,307
95,727
131,172

Amounts
due
from
Group
undertakings
Other taxes and social security costs
Prepayments and accrued income
Other debtors

On 4th December 1997 the directors of the charity executed a first legal charge over the book debts of the wholly owned subsidiary company.

The loan to the subsidiary company is the subject of a formal loan agreement between itself and the Charity dated 4th December 1997 and which is subject to the following:

a) Interest is to be charged at 1% over bank base rate and the loan is secured by a fixed charge over book and other debts of the wholly owned subsidiary company.

b) The loan is to be renegotiated in the interests of the Charity each year and shall be repayable to the Charity on the 31st July each year.

16
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group
Group
2022
2021
£
£
Bank loan (secured)
45,690
34,399
Trade creditors
53,413
51,920
Obligations under finance lease and
hire purchase contracts
4,604
5,858
Accruals and deferred income
293,752
234,176
Other taxes and social security costs
41,147
24,124
Other creditors
7,372
5,636
445,978
356,113		 Charity
Charity
2022
2021
£
£
45,690
34,399
2,963
5,127
4,604
5,858
35,635
34,019
25,856
24,124
7,372
5,636
122,120
109,163

31

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

17
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group
Group
Charity
2022
2021
2022
£
£
£
Bank loan (secured)
503,025
549,452
503,025
Obligations under finance lease and
hire purchase contracts
7,186
-
7,186
510,211
549,452
510,211
1-5 years
510,211
179,585
510,211
More than 5 years
369,867
510,211
549,452
510,211		 Charity
2021
£
549,452
-
549,452
200,103
349,349
549,452

18 SECURITY

The bank loan and overdraft is secured by a legal charge over the freehold property of the company.

19 Deferred Income Deferred income comprises advanced sales for courses, quarterly membership and monitoring which are carried out post year end.

Balance as at 1 August 2021
Amount released to income earned
from charitable activities
Amount deferred as at 31 July 2022		 Group
Group
2022
2021
£
£
169,583
169,912
(169,583)
(169,912)
225,344
169,583
225,344
169,583

32

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

20 FUNDS - GROUP

Tangible fixed assets
Net current (liabilities)/assets
Liabilities due after one year
Restricted funds
Loan stock
Unrestricted funds
General reserve
Revaluation reserve
Loan stock
TOTAL
Name of Fund
General reserve
Revaluation reserve		 £
£
Unrestricted
Restricted
Funds
Funds
Total
£
£
£
1,521,043
1,521,043
56,717
56,717
(510,211)
(510,211)
1,067,549
-
1,067,549
Balance at
Income
Expenses
Transfers
1-Aug-2021
£
£
£
£
-
-
-
-
-
-
-
-
169,402
1,788,996
(1,832,935)
(14,047)
787,086
155,000
-
14,047
-
956,488
1,943,996
(1,832,935)
-
956,488
1,943,996
(1,832,935)
-
Description, nature and purposes of the fund
The 'free reserves' after allowing for all designated funds.
The value of freehold property at market value in excess of
carrying value at historical cost.		 Balance
31 July 2022
£
-
-
111,416
956,133
-
1,067,549
1,067,549

21 Operating Leases

Within one year
Between two and five years
Greater than five year		 2022
2021
£
£
11,312
13,113
24,022
28,016
-
5,668
35,334
46,797

33

Stockport Engineering Training Association Limited Notes to the Consolidated Accounts for the year ended 31 July 2022

22 ULTIMATE CONTROLLING PARTY

There was no ultimate controlling party during the year under review or the preceding year.

23 MANAGEMENT REMUNERATION

Decisions on management remuneration levels are made by the Chief Executive taking into account the job role, peer group salary evaluations, appraisals and advice from the Financial Accountant.

The Chief Executives remuneration is ultimately set by the Board.

24 RECONCILIATION OF NET MOVEMENT IN FUNDS TO NET CASH FLOW FROM OPERATING ACTIVITIES

Net movement in funds
Add back depreciation charge
Sale of Fixed Assets
Less profit on disposal of FA
Add back (Gains)/Losses on
revaluation of Fixed Assets
Movement in Investments
Deduct interest income shown in
investing activities
Decrease (increase) in stock
Decrease (increase) in debtors
Increase (decrease) in creditors		 Group
2022
£		 Group
2021
£		 Charity
2022
£		 Charity
2021
£
111,061
37,499
2,000
(908)
(155,000)
(74)
(5,772)
(8,644)
89,865		 424,280
59,545
2,500
(980)
(463,000)
(16)
(5,719)
(54,569)
(36,534)		 111,106
37,499
2,000
(908)
(155,000)
14
-
35,445
12,957		 355,733
59,545
2,500
(980)
(463,000)
48
(3)
-
(40,029)
(19,815)
70,027 (74,493) 43,113 (106,001)

25 POST BALANCE SHEET EVENTS

Following an inspection from 13-16 September 2022, Ofsted assessed the overall effectiveness of SETA as unsatisfactory on 9 November 2022. This resulted in the Education and Skills Funding Agency terminating their contract with SETA, the income from which had represented 47% of the charity’s overall incoming resources in the year ended 31 July 2022. From 1 March 2023, SETA transferred all apprentices and commercial engineering training courses to Elevated Knowledge Limited. As part of the agreement they would lease a large proportion of SETA's training centre and take over the majority of staff and equipment. The actions have been accuately reported to the Charity Commission and the charity's lenders.

34