Registered number: 01666027 Charity number: 513149 Azure Charitable Enterprises (A company limited by guarantee) Annual report 31 January 2024
Azure Charitable Enterprises (A company limited by guarantee) Contents Page Reference and administrative details Trustees, report 2-24 Tnjstees, responsibilities statement 25 Independent auditorfs report to the members of Azure Charitable Enterprises 26-29 Consolidated statement of financial activities 30 Consolidated balance sheet 31 Charity balance sheet 32 Consolidated statement of cash flows 33 Notes to the financial statements 34-52
Azure Charftabl• Entsrprises (A company fimtted by guardnteel Reference and admlnlstratlve details Year •nded 31 January 2024 Truste G P Barnanl, Chair G W Robson, Treasurer & Chainnan R J Adams S J Hauowdl <re8ioned 24 May 2023) l Hindle J Wake J Molser J A Roblnson (reslgned 22 May2024 A Charfbn M Bth (appointed 22 May 2024) Company r•glst•r•d numbor 0168W27 Charlty Mg18ter•d number 513149 Registored office Mccallum Housa lfjekl8rAven Cramlington Northumberland NE23 8JT Company secrotary C Riby Chl8f •xecutive offl¢er P J Wibon Indep•ndent auditor UNW LLP St James, Boulevard Newcastle upon Tyno NE14 Lloyds Bank plc NcaSrfe upon Tyne NE1 &4G 8olleftors ucklè LLP 32 Gallcylvgate Newcastle UP Tyme NE14BF Presld¢nt Neil RInson MBE, JP The Viscount 'd18Y A.E Kilbum OBE FCIH Neil FUM FCA Patron VI Prnsidenl8
Azure Charitable Enterprlses IA company Ilmlted by guarante•) Trustees. report Year ended 31 January 2024 The trustees present their annual reFQrt together with the audited financial ststements of the charty for the 1 Febwary 2023 to 31 January 2024. The nUal report seNes the purposes of b¢)th a trustees, report and a directors. report under company law. The trustees confimi that t annual report and financial statements of the charitable company comply wrth the curr•nt Stalutory r•qulremgnt$, the reqUIrentS of tho charitabb c¢mparfs govemlng document and the provisions of the Statement of ReMeThded Practice {SORP) applicable to chariiies preparing their 8ccounts in accordance with the Financial Reporting Slandard applicable in th¢ UK and Republic of Irdand {FRS102) (effeGlive 1 January 2019). Azure Charilable Enterprises ts a registered charity with a misslon to "inprove the Ilves of people who •r• digabled or dl$advantsg¢d'. The charity was fOrnd in Northumberland in 1979 at a time then attitudes toward¥ 'disabilW w¢re ¢hanging. Famllles (locally) 80ught allernalives to what was often a liftrtime of institutionalised care and confinemen( while PDIIGY makers too were actively engaged In p¢rhap$ Ihe first meaningful dlseussions 8$ to the eoncepts and praclices urKlerplnnirtg the delivery of care and support. Most 8ignffKantly, in whal was s¢)mething of a Watershed mom•n( it was detemlned that care shoukl be provided and supported Thi communliles (as opposed to what was tradlionalty provtded oulwith the rnMunty- and in wh might be best descrlbed as '01 communltles,). The charfty was f¢xmally established In 1982, and has been supporting peopb with a di8abifrty lo maximiz8 their qualty of e, life chances and personal development for more than 40 years. Azure Charltable Enterprises. principal focus is to deliver social value for our cllent communty io. those with 8pecia •ducation needs andlor disabilities or who are olheThvi8e dlsadvared. The charity delirg again•t these obiectiV8S thrOh oui: Care & SUPP Servl¢es Education Ser¥ice$ Emplowment ar Tralnlng Servkeg supptsd Bus5ness (Garden Centre. Café. Business Cerkn and Landscaping Business) providing 'Supported Emplownenf for up to 50 people with disabiltties. Azure Charit8ble Foundatlon (launchkng Hi 2025)" The charity &nploy8 215 p•r8onnel, and group revenues exceeded £IllIon this year. 'FurtheT to our AGM In 2023, the Executive and Board of Trust883 have 8ubmMted an applic8bon to the Chwity Commlsslon to change lh8 Charit8 to the 'Azure Charitable Foundation.. Whereas the corryt of a grantrfning foundation was origwialty concelv•d as a separate enlty to hold andlor chanMI 8(xne of ijur operating surpluses into comnwnty pr(¥ectslorganlsation$ supportlng ow dierrt group and this remairts part of our ambition, we have detennined Ihat Ihis change of narne and as60cialed branding will better. représent the fact that the natur8 and scope of all Azure's work Is integral lo this endeavour l.e. it is indivisble. and (li) support other strategies and plans golng forw*.
Azure Charitable Enterprises (A company limitsd by guarantee Trustees, report (continued) Year ended 31 January 2024 Objectives and activities • Pollcies and objectives The geographic scope of the charitys operations has traditionally been confined to the North East of England, atthough this is not a policy limitation. The overarching mission of the charity is to "improve the lives of people who are disabled or disadvantaged" by providing: Education and Vocational training supporting our students, personal development and extending opportunities to improve their life chances, Care and Support- supporting people to live independently and their engagement in the communty, Support for those seeking employment and those in employment (to sustain their employment). Employment {at Azure in our 'Supported Businesses,) where we work with people to develop their skills, competencies and experience which also enables them to pursue employment ou1th ure. Maximising independence, personal development and achievement are our fundamental aims that we achieve in a variety of ways - many of which are complementary- with many of our clients accessing more than one type of service. In addition to Care & Support, Education and Employment Services, the charity has established and operates a number of businesses {e.g. Azure Business Centre) and 8 SUPPOrted businesses to generate income and to provide sustainable paid employment and real 'on the job, learning and training opportunities for people with a disability (i.e. Azure Garden Centre {incorporating our horticultural nurseries}, Café and Azure L8ndscapes and Grounds Maintenance businesses.
Azure Charitable Enterprises {A company limlted by guarantee) Trustees, report (contlnued) Year ended 31 January 2024 Strateglc report Achievements and performance Main achi•v•ments of the charlty Nolwithstanding the impact of COVID-19 and the challenges posed by the pandemic, the management team is stsble, flexible and has demonstrated a capability for innovation that will enable the Board of Trustees to embark, with confidence, on the next phase of the charitls development. The scope and scale of their achievements this last year is a testament to their dedication and Commitment to the charity and the communities we serve. The charity greatly appreciates the generous financial donations reiVed this year. The charity has received donations from Belay, Coca-cola, the Handley Trust and Ramsdens Financial SeNices and these donations have been used to purchase recreational equipmenufund extra-curricular activities for our students. The charity has also received generous legacy donations from Support Services clients 2nd donalions in memory of Mr Chris Turnbull. These donations have been used to provide additional activities for our clients such as theatre trips and Christmas parties. Azure Buslness C8nlres Limited The business, which is a wholly owned subsidiary of the charity, provides office space and business units for small and start up enterprises and is located in Newbum, Newcastle upon Tyne. Occupancy at the centre is at a very satisfactory level generating a profit of £44k, before Gift Aid to the charity, in the year compared with a £235k loss in 2023 (which included a £302k loss on investment property). The business contributes significant value to Azure's balance sheet with both landlbuildings, strong cash generation and by it gift- aiding any surplus to the charity. Azur• Garden Centre The charity's wholly owned retail subsidiary, Azure Garden Centre Limited, returned a profit (in 23124) of £498k, before Gift Aid to the charity, compared to a profrt of £412k in 2022123. The Garden Centre continues to fulfil its purposes of gainfully employing and training people with disabilty and by the gift aiding of any profit to th8 charty to support our broader charitable endeavours, £433,656 in the current year. Azure Landscapes & Grounds Maintenance The Landscapes department had another satisfactory year posting an operatin9 surplus of £41 k {£57k surplus in 2022123). The team continues to secure addilional work, creating and sustaining the employment of supported employees. Azure is particularly grateful for the ongoing support of Karbon Home8, Coca-cola, Anchor Housing. Greggs, Burbery, Ferney Chesters, Miller UK and Blagdon Estate. The Landscapes operation continues to employ a large number of people with disability. Education & Tralnlng Services Working with local authorities and other partner organisations, the charty continues to develop a range of education pathways for students.
Azure Charitable Enterprises (A company limited by guarantee) Trustees, report (continued) Year ended 31 January 2024 Strateglc report (continued Achlevements and parforniance {continued) SeDiices are focused on providing programmes for those aged 16 and above in recognrtion of the fact that this dient group is perhaps the least well served by mainstream education and, indeed 'special' or 'SEND' schools and notwithstanding their best endeavours. At Azure, our programmes are devised not onty to support our students. personal development but also their social and employability skills. Employability is a key facet of each of our educational programmes {horticulture, catering and hospitalty, retail and customer service) where each student has the opportunity to develop key skills and meaningful work experience by working in any of our businesses. Leamers (generally with Educational Health and Care Plans) are referred to Azure's aliemative pathways and settings by Northumberland County Council and latteTly North Tyneside Council. Our programmes have been developed specifically for learners (aged 16-24) for whom mainstream schools andlor GFE Colleges have beenlare unsuitable or where it has been deemed that these pathways werelare ill- equipped to support learners with particularly high needs (moderate to severe leaming difficutties andlor disabilities) that include, bLrt are not limited to.. Acquired Disability (Brain Injury),. Anxiety,. Attachment disorders Attention def1t hyperactivity disorder (ADHD>,' Autism spectrum disorder (ASD). Cerebral Palsy; Downs Syndrome. Dyspraxia,. Spina Bifida Epilepsy., Finelgross motor skill difficulties., Hypermobility. Obsessive-compulsive disorder {OCD)', Post-traumatic stress disorder {PTSD); SighUHearing impairment., Social, emotional and mental health needs., Speech and language difficulties- Tourette's syndrome In addttion, we also teach Leamers designated a5 a 'Child in Need, andlor'Looked After Children,: A 'Child in Need. (CIN) is defined under the Children Act 1989 as a Child who is unlikely to reach or maintsin a satisfactory level of heamh or development, or their health or development will be significantly impaired, without the provision of services, or the Child is disabled. 'Looked After Children. are children and young people for whom the Local Authority becomes their Corporate Parent,. this means that the Local Authorty is responsible for finding them a safe and stable home. Where it is in the best interests of the child this could be a short-term arrangement whilst the famity is supported so that children can safely return home: or this lead to the children and young people being in the Local Authority's care for the longer tenn. Our leamers are enrolled on study programmes where core funding is provided by the Education & Skills Funding Agency {ESFA) and where additional costs associated with each Learnerfs need5 are provided by the Local Authorities e.g. Speech & Language Therapists, Occupational Health Specialists, etc, (supporting Learners and their familieslcarers).
Azure Charitable Enterprises (A company Ilmited by guarantee) Trustees. report (continued) Year ended 31 January 2024 Strategic report (continued) Achievements and performance (contlnued) In addition. the Local Authority also provides for our learners. travel costs to and from college (by taxi) if they do not travel independently and require support within and ou1th Azure, As they study wilh us, we also work with leamers to support their personal and social development {leamers may, for example, be non-verbal), independent living skills and to secure local employment where possible (within and ou1th Azure), To support enrichment activities, the charity also makes £20,000 available to the department to ensure that there are no economic barriers to participation in enrichment activities including extra- curricular activities. The Education Services Departm8nl continues to develop new pathways and a new curriculum that incorporates Hospitalrty and Catering, Horticulture, Retail and Customer Service. We have 45 students enrolled this year and have been approached by Northumberland County Council to develop programme5 for young people {aged 16-24) with social, emotional andlor mental health needs. As previously reported. the Hospitality and Catering programme launched in September 2020 and was supported by £250k capital investment in the creation of a new teaching kitchen (and which also attracted financial support from the Reece Foundation and the Molrtor Charitsble Trust}. Working with Northumberland County Council, recruitment to our education and training programmes 'Skill- builders, (personalised vocational training and personal development programmesl and 'Supported Internships, has increased, year on year.. Learner Enrolment 55 50 45 41 33 23 15 io 2J16117 2017I'lg 2ff418119 219 12.J 2ry24121 2a21]22 2J22123 2 23 12£ 2324125 At the time of writing we expect our enrolment (in August 2024) to be circa 55 student8. The department is also working wrth 6 supported intems who are presently working in Azure's Garden Centre café.
Azure Charitable Enterprises (A company Ilmlted by guarantee) Trustees, report {continued) Year ended 31 January 2024 Strategic report (continued) Achievements and perfomiance (continued) The department has a dedicated employment advisor who works extensivety with students to plan and secure their progression deskn'nations., this includes securing voluntary and WOTk-placement opportunities for students, identifying surtable job opportunrties and assisting students to apply for roles and prepare for interview. This year.. 22 learners retumed for a 2nd year 6 learners entered a Supported Intemship programme (with Azure Education) 2 leamers entered onto a Supported Intemship programme (with Choices College) 1 leamer secured paid employment within a landscaping business 2 learners accessed courses at Newcastle College 3 leamers secured volunteer placements (2 in Azure café, 1 in café in Ashington) alongside adult social care servIs. We will a150 SUPPOrt any employer that provides a progression destination for our students. Demand and interest in our Education Serrfices continues to exceed expectations with Mccallum House being adapted still further to accommodate additional students and with staff, in all likelihood, to be operating from temporary buildings (portakabins) situated in the Mccallum House car park. In the last year, the charity has been in discussions with North Tyneside Council and expects to WelMe circa 10 students from North Tyneside in September 2024. The service is regulated by Ofsted. • Employment Services According to the ONS Labour Force Survey, 9.6 million people of working age (16 to 64) reported that they were disabled in January to March 2023, representing 230/0 of the working-age population. This is an increase of 600.000 people from the year before (ONS. Dataset A08: Labour market status of disabled people, 17 May 2022, GSS standard levels). In the same period, an estirnated 5.1 million disabled people were in employment. This works out as an employment rate of 53.70/0, up from 51.70/0 in 2019. The ONS reports that disabled people are considerably more likely to be economically inactive and that while the economic inactivty rate for disabled people was 42.7Y.. the corresponding figure for those who are not disabled Leonard Cheshire's 'Locked out of the Labour Market, report (October 2020) highlights the disproportionate impact of Covid-19 on disabled people's employment, with 840/0 of young disabled people who were employed in March 2020 experiencing an impact to their employment due to the pandemic, compared to 71 ¥0 of all employed disabled people. For over a decade, the disability emplonent gap has remained at around 300/.. Covid-19 has exacerbated existing structural inequalities, posing the risk of entrenching barriers to the workplace for disabled people. Young people with disabilities are disproportionately affected by the impact of Covid-19 on employTnent. Data from the ONS 2020 Labour Force Survey (July to September) found that just 370/0 of disabled young people aged 16-24 are in employment compared to 550/0 of non4isabled young people. This is a 4 % drop in the empbyment rate from 2019. Azure administers and operates, in accordance with demand, pr&employment, basic and key skills, information
Azure Charitable Enterprises (A company limited by guarantee Trustees. report (continued) Year ended 31 January 2024 Strateglc report (continued) Achievements and perfomiance {contlnued) technology and vocational training courses so that clients may develop transferable work skills enablin9 disabled or disadvantaged people to find and secure sustainable employment. Our Work also includes supporting clients to overwme personal barriers to employment and support their personal development regardless of whether this is linked to specific (fomall qualifications or job outcomes. In ci>operation with the Department for Work & Pensions (DWP) and local 8mployers, clients are assisted to secure valuable work placements {including in our supported businesses) and 8UStainable empk)yment. Our Employment Services department has a holistic approach to clients., it recognises and understands the important, intrinsic link b8hv8en many factors that may ultimately impact on employment. The department's work therefore does not stop at employment, V support and signpost clients for expert support in areas outside of our area of expertise such as liaising with homelessness teams or bereavement counsellors. Azure continues to be Commissioned direct by DWP to provide these setvices and has, since 2020. sought to increase the scope and scale of our work wrth support from the North East Local Economic Partnership and European Social & Investment Fund and by working in partnership with the North East Autism Society. Working in partnership with the North East Autism Society our Employment Services team has been delivering a programme called DiverstyNE which was funded (by the UKSPF) until the end of December 2023. The programme supported both unemployed and economically inactive people with neLtrro4iverse conditions on their journey towards employment. The programme was oversubscribed by 20/0 and exceeded all targets and we are pleased to report we supported: 68 people to gain paid employThent 59 people to move into education or training 32 people move from being economically inactive to actively job searching Clients have secured roles across the region with a range of employers and roles that included: Ad Gefrin Kitchen Porter APS Blyth Warehouse Assistsnt Azure Garden Centre Café Assistant Azure Grounds Maintenance & Landscapes Landscapes Assistant Bark Kennel Staff Bupa Cafe Services (Ridley Park Care Home) Care Assistant Community Integrated Care Support Worker Compass Group CleanerlHandyman Coquet Medical Group Medical Secretary Crofvay Academy Administration Assistant Apprenti¢6 Level 3 DA Howie & Sons (Morwick Dairy)
Azure Charitable Enterprises (A company limlted by guarantsel Trustees. report (continued) Year ended 31 January 2024 Strateglc report (contlnued) Achievements and perforniance {continued) Dairy Assistant Haven Activities Team Member JD Sports Seasonal Night Colleague La Cura House Care Home Domestic Assistant Morrisons Customer Assistant Newcastle Building Society Customer Service Adviser Newcastle City Council Customer and Culture Assistant Apprentice Newcastle University Business Administration Apprentice Newcastle University Research Impact and Engagement COrdInatOr Northumbria Health NHS Foundation Trust Senior Healthcare Support Worker Apprentice Level 3 Playnation Arc8de Assistant One Stop via Tesco Customer Assistant NorthEast Autism Society Team Leader (Family Support) RNIB Transcription Production Assistant SAJ Transport Consultant Graduate Transport Modeller Vue Cinema Customer Assistant Clients are also supported to access training programmes to support their personal development and employability skills delNered online andlor in person by Adult Education providers that include independent training providers, charities. FE Colleges and universities. By way of example. online programmes have included.. Communication Skills COSHH Customer Seniice Skills Display Screen Equipment Food Hygiene GDPR Health & Safety HeaFth and Social Care L2 Food Hygiene and Safety for Catering Microsoft Excel and Google Sheets PA & Secretarial Skills Warehousing & Storage Clients have also been supported to pursue:
Azure Charitable Enterprises (A company Ilmlted by guarantee) Trustees. report (contlnued) Year ended 31 January 2024 Strateglc report (continued) Achlevements and performance {continued) BA (Hons) Business Management (Northumbria University) Business Administration Level 2 (North Tyneside Council Employment and Skills) Cookery (Newcastle City Learning -Westgate Community College) Counselling {Newcastle College) Functional Skills L1 Maths (Northumberland Skills) Get into Retail with M&S (Prince's Trust) ITV Making Creativity Work (ITV) L2 Certificate in Teaching and Learning {Newcastle College) L5 Developer Operations Isunderland Sofvare City and Gateshead College) SIA {PeoplePlus} Working with the NorthEast Autism Society, we have been successful in securing funding (again from the UK Shared Prosperity Fund administered by the North of Tyne Combined Authority) for additional programmes: 'ProgressNE' (launched in October 2023} and 'Empower Works NE, (launched in April 2024) Both programmes run until March 2025 and aim to support 260 clients in total. As of mid-April 2024. ProgressNE has supported its third client to 9ain employment. We are also supporting clients in a number of other areas including travel training, accessing community groups (to lessen social isolation and develop routine), securing volunteering opportunities and securing a pla at universty (by helping with interview preparation). The department continu8S to develop its strong relationship with Education SeNices. It has long been recognised that there is a funding gap for those learners leaving education and clients referred for employabilty support some years later. We recognise the need to secure funding for a programme to transition leamers from ESFA funded education programmes into independent living while also being supported to continue to access support for volunteering, personal development and employabiliiy skills (including employment). In 2023, the department was invited by Bellway to take part in their Graduate Challenge. We worked closely with a small group of Bellway graduates from across the UK. A2ure set them a challenge of how it could increase the number of our clients who gain work experience or paid employment in the construction sector. Over a number of months of meeting regularly, the graduates presented their findings, ideas and suggestions. W8 vlere also presented with a £1 Ok donation which the department is looking to put towards a specific project to expand our reach and support more people with disabilty through personal development or with their journey towards employment. 10
Azure Charitable Enterprises (A company limited by guaranto¢) Trustees. report (continued) Year ended 31 January 2024 Strateglc report (contlnu•d) Achlevemonls and performance (continued) • Supported Employment at Azure The number of people involved in the supported employment activities in its businesses (Corporate Services, Garden Centre. Nurseries, Landscaping business and Education SeNices) wa5 28 at the year end (28 at year end 22123; 20 at year end 21122). Employment Services continue to provide information, advice, guidance, job coaching, job aiding and emots'onal support to our internal supported employees who work throughout the charity. We work closely with departmental managers and supervisors and provide job coaching and support personal development where additional support may be required.
Azure Charitable Enterprises IA company Ilmlted by guarantee) Trustees. report (continued) Year ended 31 January 2024 Strategic report (continued) Achievements and performance (continued) • Supporl Servlces Support Services provides a range of care Services to individuals with disabilities in the North East region. The charitys residential based work in the housing departments of Cramlington, Washington, Tynedale, and Newcastle, as well as its enabling support activity around the North East, are of the highest quality and are regularly verified by third paty inspections. Azure's aim is to support clients to achieve autonomy, exercise their personal freedoms and make choices about the lives they lead. Our seNices are tailored to individual needs and are delivered in a flexible, personalised way to support all our clients including 2417 rf required. Our staff are expert and experienced in mentoring and supporting the development of life-skills and assisting our clients to engage with the broader communty. We work with each of our Clients to understand and support their personal aspirations, their interests and their active participation in not only leisure and recreational activities but also employment opportunrties. As an organisation, we are committed to delivering high qualty care and support that affords our clients wrth a sens8 of continuity and accountability for all working practices and we are registered with the Care Qualty Commission to provide personal care. Above all, we are detemined to protect and secure Our clients, rights to high quality care and to ensure that our clients live happy and fulfilling lives. Azure employs highly trained professional staff to support people with a disability to live in homes appropriate to their needs and to support them to live as independently as they are able. The charity works closely with local authorities and partner organisations thal provide homes for people with a disability whilst also providing an enabling service for clients to better access the communitylcommunity facilities and public amenities. The funding stream mix is complex and variab, but it allows the charity lo continue providing high-qualty support services to those who need it most. Resldentlal Car8: Support Servitts have been providing residential care support to individuals with disabilities in two homes in Washington (for 29 years}., at the end of the year, 11 residents vRre being supported in the homes through this service. The qualty of the 8UPPOrt provided is regularly verified by third paty inspedions to ensur8 that it meets the highest standards of care. As reported last year, Azure has agreed with SeNice Commissioners that the homes would be deregistered and re-registered as independent supported living homes. The process of deregistering the service is now complete, and both services are now registered as ISL services. As part of this process, client needs have been re-assessed with additional hours of 1-1 support commissioned that viill support clients, emotional health and well-being. A 12th client is due to move in, in the near future. A satellite seNice has also been established for a client that has been supported to move from this shared model of care, to live in their own home with 1-1 support. As a result, the client is able to remain living in and as part of 12
Azure Charitable Enterprises (A company limited by guarantee) Trustees. report (continued) Year ended 31 January 2024 Strategic report (continued) Achievements and performance {contlnu•d) the community rather than returning to a hospital seth'ng. We are now working with Sunderland City Council and their Adult Social Care teams to develop and grow our offer in and around Sunderland in this vein. Supported Living: In addition lo residential support, Supporl Services also provides Supported Living serViS in Newcastle and Tynedale. Supported Living aims to enable clients with disabilities to live independently in their own homes andlor with others (in environments that are safe, inclusive, and integrated) with support provided by trained professionals. This service allows individuals to have more control over their lives and live with greater independence. The level of support provided varies depending on the client's needs. but it can include support with daily living tasks, such as cooking, cleaning, managing finances, accessing healthcare, and maintaining social connections. Support is tailored to each person's specific requirements, preferences, and goals, promoting their autonomy. choice, and conlrol over their lives. Azure fosters opportunities for social interaction, personal developmenl, and meaningful participation in society. Support staff are available to provide assistance as needed, but the emphasis is on empowering the individual to lead fulfilling and independent lives within their communities. At the end of the year, 62 residents were being supported through the seDiice. Enabling Support: Support Services also provides enabling support services to people with disabilities throughout the North East region. This service supports individuals with disabilities to access the community, participate in social activities, and live more independently. This seNices aim to encourage involvement in society. foster inclusivity, and improve the lives of indmduals with disabilities. The enabling services give priority to crafting personali5ed support plans tailored to the unique needs, preferences, and aspirations of each Client. This could encompass everyday tasks like household chores and financial management. Clients receive assistance in improving their skills to maximize independence and 5elf-relian¢e. This may involve training in Communication, mobility, socialisation. and vocational skills, facilitating better integratFon into both the community and the workforce. Empowering client5 to assert their rights and access services, resources, and opportunrties of their choosing is a key aspect of our enabling services. Enabling support facilitates meaningful engagement in community lrfe by connecting clients with social neorkS. recreational activities. educational opportunities. and volunteer opportunitie5. This cultivates a sense of belonging, social connectedness, and fUlIment beyond formal support Structures. Furthermore, enabling services promote overall health and welkbeing by addressing physical, emotional, and mental health needs. This encompasses facilitating access to healthcare services, promoting heallhy lifestyles, and offering emotional support and counselling as required. For clients undergoing transitions from institutronal settings or experiencing life changes, our enabling support 13
Azure Charitable Enterprises IA company Ilmlted by guarantee) Trustees. report (continued) Year ended 31 January 2024 Stratsgic report (continued) Achlevements and performance {continued) provides support with transition planning. resettlement, and integration into community living. This often involves coordinating seNices. collaborating with relevant agencies, and delivering ongoing support throughoLrt periods of change. At the end of the year, 53 service users were receiving support through the Communty Access enabling service. At the time of writing, we are now supporting 56 service users. Corporate (Central) Services A variety of corporate functions are centralised and perfomied by a small, dedicated team that supports the charty to deliver services and operate the charty's constituent businesses. It also assures compliance with all legal and other requirements. Key functions include finance, administration, human resource management including recruitment, performance management, payroll, work force development, IT infrastructure, mainlenance, janitorial and securty. 14
Azure Charitable Enterprises (A company limited by guarantee) Trustees. report {contlnu8d) Year anded 31 January 2024 Strategic report (continued) Flnancial rnview The charity continues to grow revenues (from the delivery of services and the operation of our businesses). Total Gross Income £9,500,000 £9,221,693 £9,000,01)O £8.879,532 £8.767.989 £8,500,000 £8,377,968 £8.221.468 £8,119,456 £8,061,019 £8,000,000 £7.808,037 £7.500.ODO £7.418.422 £7.324,913 £7,000,000 £6,500,000 £6.01.000 2014115 I 201S116 [6 2016117 2017118 • 2018119 1 2019120 • 2020121 112021122 m 2022123 • 2023124 As previously reported, whereas a number of the charity's trading businesses, while providing a much-valued source of employmenl for our Clients, have historically posted operating deficits, this is no longer the case. The sustained improvement in the group's financial performance has allowed the charity not onty to create a 'Charitable Re$eNe' as a safeguard against financial and operational uncertainties and to improve pay and remuneration across the group as we endeavour to become a Real Living Wage Employer. 15
Azure Charitable Enterprises (A company limited by guarantee) Trustees, report {continued> Yoar ended 31 January 2024 Annual Operating Surplus/ Deficit (Gross.) £1,0.000 £892.000 £800,000 £736,D72 £60Q,OaO £578,102 £395,615 £400,0110 £200,OQO £6,685 -£69,650 -£20,930 -£200,000 -£108,579 -£122,110 -£258,740 -£400.000 2014115 • 2015116 • 2016117 2017118 M 2018119 • 2019120 • 2020121 m 2021122 • 2022123 • 2023124 "Excluding exceptional costs {see below) to incur additional levels of expenditure. As reported last year, Local Authority fees (for the delivery of Support and Day Services) still do not reflect the real terms increase in pay costs (National Living Wage or Real Living Wage) and overheads which continues to see increasing numbers of service providers across the UK hand back service5, decline to provKle these servi8 or othemise exit the mathet. This continues to drive an increased number of privately owned care businesses being offered (to Azure) for sale., to date, we have yet to receive an invitation to purchase what we would consider a 'financially viable, business. Fee rates for 'day servIs. continue to prompt some of the most notable service providers (in the region) to withdraw services on the basis that they are no longer economic to provide. We are aware that a number of care providers have been and continue to be {financially} compromised by the fact that they have been and are delivering services at an op8rational deficit andlor have been supporting the delivery of senilS from their reser4es. The charity has struggled for a number of years to recruit support staff and continued to be overly reliant on agency staff to support the delivery of Support SeNices. In 2023124, we committed lo Support Services becoming a Real Living Wage Employer - whereas fees from Sunderland Cty Council (agreed in 2023) support this initiative, at the time of writing, fee rates from other Authorities have failed to sustain this financial commitment with fee rates significantly less than the costs of inflation and increases to NLW and RLW this year. 16
Azure Charitable Enterprises (A company limitsd by guarantee) Trustees. report (continued) Year ended 31 January 2024 Summary The charity continues to deliver an outstanding range of services (Care & Support, Education and Employment) and operates a number of commercial businesses that provide 'supported employment, for our clients in what remain very challenging circumstances. The Garden Centre, Business Centre and our Landscapes business continue to perform well supporting the delivery of a very healthy operating surplus (see overleafj. The delivery of Commissioned Services (Adult Care services to Local Authorities} remains challenging as Local ALrthority fee rates have failed to keep pace with inflation in (real temis), for many years the delivery of services has andlor is becoming increasingly 'marginal' with seN18 returning operating deficits. l.e. where real costs of delivery exceed the fee income from Local Authorities (and which are generally calculated to support the employment of support staff at no more than the National Living Wage rate in any event. This, in our considered opinion, continues to debase and devalue the work of our staff {which continues to frustrate staff recruitment and retention). The Board of Trustees are mindful that Azure was founded to provide added-value in our communrties and to enhan the delivery of services,. it is not Azure's role to subsidise the delivery of local authority obligations and we are determined to ensure that Azure's improved financial performance and resources are devoted to the fomier. With our operating surplus returning to what we could consider a 'healthy' and, most importantly, sustsinable pre-pandemic baseline our focus remains on the development and sustainability of services. Annual Operating Surplus/ Deficit {Net°) £l,DOO,000 £800,000 £736,072 £600,000 £578,102 £510,000 £400,000 £395,615 £200,000 É3.685 Illl -£20,930 -£200,000 -£119,650 -£102,866 -£265,579 -£400,000 -£304,540 2014115 * 2015/16 r 2016117 2017/18 ll 2018119 • 2019120 • 2020121 112D21122 ll 2022123 * 2023124 'As illustrated above, consolidating on work commenced in 2018119 designed to stem operating deficits and restore the charitls financial health and long term viabilty that included a number of eXptIOnal costs including a £400k emergency loan to support restructuring costs (and, subsequently, 8 £300k investment in the Garden Centre Café and the creation of a new teaching facilty) the charity posted a net operating surplus of £51 Ok in 17
Azure Charitable Enterprises IA company limited by guarantee Trustees. report (continued) Year ended 31 January 2024 20121, £736k in 21122 and £395K in 22123. This sustained perfomiance has also allowed th8 charity to establish a Charitable Reserve. Group performance in 2023124 remains strong, posting an operating surplus of £578k in 23124. The delivery of much-needed Employment Seniices remains contingent on securing funds or service contracts for the delivery of the same, Supported Employment and our Supported Business status remains dependent on the trading performance of our 'ventures' i.e. Garden Centre, Business Centre and Landscaping businesses - and the patronage of locallregional organisations. We are most grateful to our ambassador organisations (Karbon Homes, Anchor Housing, Miller and Coca Cola). The charity will continue to be a strong advocate for those we support and their families. challenging inequalty and to make concerted efforts to shape policy (national and local) by working more collaboratively with other services providers particularly as regards 'strategic commissioning, and budget setting (for the provision of support services) inlby Local Authorities wrth the aim of 5UPPOrting improved pay and conditions for our Support SeNices staff. To this end, the Board of Trustees and the Executive are committed to working locally, regionally and nationally to ensure that the worl( of Adult Care staff is more widely understood. acknowledged and propedy valued. Reserves and Going Concern The charity's reserves policy is designed to cover the short term (12 month) cash requirement arising from a reduction in income or additional expenses based on the most significant short term risks lo the business. It is expected that cash requirements after 12 months from such events would be covered by operational changes or funding arrangements. The current level of reserves required is £200k and this is reviewed periodically. The results for the year provide the Azure group with a net asset position of £5,390,55912023'. £4.784,273). At the year end, the group had a net current asset position of £1,842.312 (2023.. £1,439,443). This is a much improved position on the previous year end and gives confidence that the group is in a much more positive position with sufficient cash to meet ts current and future obligations. The charity's forecasts and projections for the next twelve months show that the charty should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance and the potential impact of adverse events political, economic or environmental (nationaifinternational). The charity and its trading subsidiaries have strong positive cash balances and is forecasting for this to continue to be the case. The trustees have stress-tested their forecasts. taking into account various scenarios, and remain confident that while the economic UnrtaInlieS remain {principally those associated with Brexit, COVID- 19 andlor any comparable eventi, they do not cast significant doubt on the charit$ ability to continue as a going concern. 18
Azure Charitable Enterprises {A company Ilmlted by guarantee) Trustees. report (continued) Year ended 31 January 2024 • Principal risks and uncertainties Risk Management The charity has a comprehensive risk review process and this is fully updated every year. The resuliant risk analysis is considered by the Audit & Risk Committee in the first instance then is taken to the Board for approval. With respect to Health and Safety, a senior manager is the charity's safety advisor and safety representative¥ are appointed in the various areas of the organisation. The Board receive (directly) regular reports on health and safety matter5 (including accident and 'near miss. statistics). The charity has discharged all borrowings and has established a Chatitable Reser and also has placed sums on deposit at a higher rate of interest. The trustees are satisfied that the systems and procedures in place are sufficient to adequately mitigate identified risks to an acceptable level in the Charitys day4¢Hlay operations. The financial statements have been prepared in accordance with the Statement of Recommended Practice.. Accounting and Reporting by Charities {SORP FRS102) and confom to current statLrtory requirements and comply with the charitable company's governing documents. • Investment powers and restrictions The Charty funds are controlled by the trustees. who also act as trustees, who invest with a view tr) safely optimising annual investment income while maintaining capital growth in line with market trends. The trustees can invest any sums or investments received by them which they are by law authorised to invest money (including trading subsidiaries), with power from time to time to change for others of a like nature. • Fundraising policy The charity is required to report how it deals with fundraising from the public. The charity does not use a professional fundraiser or commercial participator to raise funds. Any monies raised directly from the public follows all guidelines set out by the Charity Comrnission and UK law in every respect. We respect the privacy and contact preferences of all public donors. • Publlc benefit ststement The trustees have referred to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the aims and objectives and in planning future activities. The charitable objectives are also set in order to provide a clear and demonstrable public benefit. 19
Azure Charitable Enterprises (A company Ilmtted by guarantee) Truste8s' report (continued) Year ended 31 January 2024 Structure, governance and management • Governing Instrument and Constitution The organisation is a charitable company limited by guarantee, inmrporated on 21st September 1982 and registered as a charity on 13th October 1982. The charitable company was established under a Memorandum of Association that established the objects and powers of the charitable company and is govemed under its Articles of Association. The charitys membership is limited to 50 members. The members devolve authority to a Board of Non- Executive Directors (Trustees) who meet bi-monthly who in turn devolve the executive management to the Chief Executive and senior managers. In the event of the charitable company being wound up. members are required to contribute an amount not exceeding £1 each. Whereas the governing instruments were revised on 30th June 2010 at the charty's Annual General Meeting" the Executive and Board of Trustees have again been prompted to review the instruments over the last 12 months with amendments that will be presented for the members, consideration at the 2024 AGM. • Board of Trusto88 The charity is governed by its Board of Trustees - who are the appointed directors of the charitable company. The number of trustees at present is 9 (the requirement being that the number is not less than 6 nor more than 20). Trustees are elected to seNe 3 year temis. retire by rotstion and are able to stand for reelection: At the 2024 Annual General Meeting Isobel Hindle and John Mosier retire by rotation (under Article 29> and being eligible, offer themselves for re*lection. At the 2024 Annual General Meeting Matt Boyle being a new Member of the Board appointed 22nd of May 2024 offer themselves for re-election (under Ariicle 34) The trustees meet as a norm not less than six times a year. They receive regular, detailed managemenl accounts (including cash flow projections) as well as reports on operational activities every month. They regularly receive presentations and reports on any major developments or proposals. They participate in the strategic planning process and have ultimate responsibility. Recrultment of Trustees Any trustee vacancies which arise are filled by search with due regard to maintaining a proper balance of skills and experience wrthin the Board. All appointments are subject to the approval by members at a General Meeting. With the notice of such meeting, members are provided with a profile of prospective new trustees - and equivalent information for any trustee offering themselves for re4lection. Additionally, a full attendance record is made available to Members. 20
Azure Charitable Enterprises IA company Ilmited by guarantee) Trustees. report (continued) Year ended 31 January 2024 Structure, governance and management (continued) Trustee Induction and training New trustees are provided with a proper induction process and all relevant papers and associated guidance to property fulfil their responsibilities - while this was challenging during the pandemic, we are pleased to welcome new members to the Board. Briefing papers and familiarisation training is effected for all trustees, as deemed necessary. • Board Sub Committees The Board of Trustees has four special sub-committees that assist the Board". Corporate Services Committee A Corporate Sejvices Committee consisting of three members of the Board and chaired by the Treasurer meets 6 times a year lo support the Board to establish and implement policies, procedures and controls to facilitate financial govemance, which includes ffinancial planning, budget approvals, expenditure approvals and financial reporting. The committee.. Functions in conjunction with the Board and the Executive on major areas of change, innovation and development. Undertakes tssks delegated by the Board that are within the committee's tenns of reference. Reviews and comments upon management accounts and financial forecasts. Considers the fin8ncial implications of proposals for areas of major new strategic development on behalf ofthe Board and makes recommendations to the Board in respect of their suitability. Maintains an oveNiew of financial performance. Reviews the charity's financial policies, including its financial reseNes policy, and comments upon proposed changes before making recommendations to the Board. Decisions are ultimately the responsibilty of the trustee members of the committee, and in reaching their decisions and recommendations they will, so far as possible. take account of the views of the executive directors and any COwOPted advisors. Audit and Risk Committee The Audit and Risk Committee consisting of three members of the Board meets twice a year to support the Board and the Executive (CEO and CFO) by reviewing the comprehensiveness and reliability of assurances on govemance, risk management, the control environment and the integrity of financial statements and the annual report. The committee.. Keeps a watching brief and provides advice, where appropriate. on potential and actual financial opportunities and threats. Assists the Board to identify the charity's major risks and developing appropriate approaches to risk management. This includes periodic reviews of the charity's insurance Cover. Oversees the process for appointing the external auditor, approving the audit fee. considering any questions of resignation or dismissal of the external auditor, and making recommendations to the Board Discusses with the extemal auditor, before the audit commences, the nature and scope of the audit Meets once a year, or part thereof, with the external auditor without management present," Reviews the annual audited financial statements before submission to the Board focusing particularly on any Changes in accounting policies, major areas of judgement, significant adjustments resulting from the audit, compliance with charity legal requirements and financial reporting standards, and presentation of the accounts from a non-financial perspective Discusse5 with the auditor matters arising from the audit Reviews policy and procedures in respect of internal financial controls 21
Azure Charitable Enterprises (A company limlted by guarantee) Trustees, report (continued) Year ended 31 January 2024 Structure. governance and managemont {contlnued) Reports periodically to the Board. The trustee members of the Audit & Risk Committee, a5 a norm, do discuss matters in private with the external auditors with no management present at the end of every Risk & Audit Committee meeting. SeNlces Commlttee The Sendices Committee consisting of three members of the Board, the Chief Executive and Heads of Servi meets at the instruction of the Board to review the nature and scope of SeiCe5, quality of services and opportunities for development to support the development of strategy and plans. The broad role of the Committee is to consider matters not otheDNise reported to the Board of Twst88s and which may relate, for example, to the development and delivery of services (including regulated Servi$) provided by Azure under contract to Government Departments, Executive Agencies (e.g. ESFA}, Local Authorities, etc, and which presently include- (i) Adult Social Care (i.e. 'Support Services,); (li) Education & Training Services- and (iii) Employment Services (including 'Supported Business,). More specifically, the Committee may be convened by the Board of Trustees to: Review the achievement and maintenance of high standards of teaching, learning and assessment (Education Services),. andlor Assess the nature, level of support and client impact (for Support Services & Employment servIs clients),. andlor Provide a forum for the Board of Trustees and Senior Managers to test new ideas relating to the development and delivery of services including assessments of their effectiveness; andlor Monitor the outcome5 of Azure's quality assurance system regarding learner andlor client experiences, including destinations, satisfaction surveys and complaints. andlor Receive, consider and monitor Azure's Setf-Assessment Reports and the associated Action Plans, to include the effectiveness of quality control of all seNices and report appropriately to the Board. andlor MonitorAzure's development and compliance with all policies and procedures regarding equality of opportunity and diversity, andlor Receive reports of formal internal inspections of areas of Support Services, Education & Training and Employment services and the associated action plans and consider them in the context of each service's strategy,. andlor Receive and consider reparts detailing studenvdient recruitment, retention and progress including changes to the profile of recruitment and report to the Board on their potential significance for the Charity's Curriculum andlor Financial Strategy. an(Vor Receive and consider reports on any other qualty requirements identified by the CQC, OFSTED or other inspectorate or funding body. Remuneration Committee The Remuneration Committee consisting of three members of the Board meets at least once each year to ensure that Azure's Pay & Reward stralegy and policies attract and motivate personnel to achieve the long-tenn interests of the charity and deliver $eNiees to the communities we seNe. More specifically, the Committee is responsible for and the scope of.. Annual c05t of living or performance related awards. The remuneration of all personnel including senior staff and the chief executive. Ensuring the policy and application of Ihe remuneration policy is equitable, fair and transparent Overseeing any major changes in employee benefits structures throughout the organisation, 22
Azure Charitable Enterprises (A company limited by guarantee) Trustees, report (continued) Year ended 31 January 2024 Structurei governance and management l¢ontlnued • Day to day management Day to day management of the charity and its constituent businesses and services is vested in a professional team led by the charity's Chief Executive. The Chief Executive meets regularly with the chair of the Board of Trustees lin addition to the formal meetings) and appraises the ¢hair of any significant issues as they may arise between meetings. The Chief Executive, Chief Operaling Officer and Chief Financial Officer (and Company Secretary) attend the Board meetings {and other senior posl-holders by rotation) but there is proper provision for the Board to discuss any matter without management attendance when they so wish. • Koy Management Personnel The key management personnel are those listed in note 11. In addition to their own attendance at the formal Trustee Board meetings, the Chief Executive. Chief Operaling Officer and Chief Financial Officer meet together with other management as needed, to address all relevant operational issues. • Pay Pollcy for Key Management Personnel Azure has identified key management personnel in note 11. The remuneration of the key personnel is determined by the Remuneration Committee. with due reference to the Corporate Services Committee and the budget agreed directly by the Board and from which the Chief Executive is excluded in relation to any specific dis¢ussion of their remuneration. The Corporate Services and Remuneration Committees are guided by fomial reports which sets oul all available relevant information which includes legislative obligations, best available benchmark data in latIon to salaries and settlement levels, internal differentials, recwitment difficulties, the recent settlement history at Azure, the proposed costs and ability to pay. 23
Azure Charitable Enterprises (A company Ilmited by guarantee) Trustees. report (continued) Year ended 31 January 2024 Plans for future periods The Board and Executive are committed to a process of continuous improvement to optimise both the financial perfonnance and the activities of the charity and its subsidiaries. While the charity has no plans at the present to radically aEter the mix of ongoing activity, nor to change the focus of the charity" the Board and Executive have had cause to review how the charitls objects are expressed and has determined that that they would benefit from further definition to recognise {expresslyl that 'disability' {and our work has come to include those with special educational needsleducation and health care plans (EHCPS) and those who are othemise disadvantaged (e.g. may be SLrffering from debilitating mental health conditions) and who are at risk of social andlor economic exclusion confiming that this is within the charty's compass. It is envisaged that economic conditions will remain challenging and with the potential to affect all departments. An organisation-wide cost control strategy exists with close scrutiny of all discretionary spending. The trustees have approved a budget for the forthcoming year consistent with these comments and the charitys overall strategic plan. The charity is however concerned to protect itself from the 'seasonality and associated risks to Garden Centre revenues (which remain weath8r dep8ndant> and this has prompted the preparation of plans to expand the garden centre to increase and diversify its income streams. While Northumberland County Council took two years to approve the charitys planning application, the delay has exposed our development project's costs (garden centre build) to unprecedented levels of inflation (>20°/0) which renders the scheme (as previously submitted to the Local Authority) prohibitively expensive. As such. the charity is also Compelled to re-draw the scheme and (unfortunately) incur additional costs (design and other associaled professional fees). Disclosure of information to auditor Each of the persons who are trustees at the time when this trustees. report is approved has confirmed that.. so far as that trustee is aware, there is no relevant audit infomation of which the charitable group's auditor is unaware, and that trustee has taken all the steps that ought to have been taken as a trustee in order to be aware of any relevant audit infomiation and to establish that the charitable group's auditor is aware of that infomiation. Auditor The auditor, UNW LLP, has indicated his willingness to continue in office. The designated trustees will propose motion reappointing the auditor at a meeting of the Irustees. Approved by order of the members of the board of trustees on 12 June 2024 and signed on their behalf by.. G P Barnard Chair 24
Azure Charitable Enterprises IA company limlted by guarantee> Statement of trustees, responsibillties Year ended 31 January 2024 The trustees (vtho are also the directors of the charity for the purposes of company law) are responsible for preparing the trustees, report including the strategic report and the financial statements in accordan 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 . Under company law, the trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the charity and of their incoming resources and application of resources, including their income and expenditure, for that period. In preparing these financial statements, the trustees are required to.. select suitable accounting policies and then apply them consistently., observe the methods and principles of the Charities SORP (FRS 102). make judgments and accounting estimates that are reasonable and prudent,, state whether applicable UK Accounting Standards {FRS 102) 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 group will continue in business. The trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the group and the charitys transactions and disclose with reasonable accuracy al any time the financial posrtion of the group and the charity and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and the charty and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Approved by order of the members of the board of trustees on 12 June 2024 and signed on its behalf by.. G P Bamard Chair 25
Independent auditor's report to the members of Azure Charitable Enterprises Oplnion We have audited the financial statements of Azure Charitable Enterprises (the 'parent charitsble companrf) and its subsidiaries (the 'group'> for the year ended 31 January 2024 which comprise the consolidated statement of financial activities, the consolidated balance sheet. the charitable company balance sheet. the consolidated ststement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation 15 applicable law and Unrted Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland, ('United Kingdom Generally Accepted Accounting Practice'}. In our opinion the financial statements.. give a true and fair view of the state ofthe group's and of the parent charitable companls affairs as at 31 January 2024 and of the group's incoming resourtss and application of resources, including its income and expenditure for the year then ended; have been properly prepared in accordan with United Kingdom Generally Accepted Accounting Practice" and have been prepared in accordance with the requirements of the Companies Act 2006. Basis for opinion We conducted our audit in accordance with Intemational Standards on Auditing (UK) I'ISAS {UK)') and applicable law. Our responsibilities under those standards are further described in the 'Auditols 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 United Kingdom. including the Financial Reporting Council's Ethieal Standard. and V have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the trustees, use of the going concem basis of accounting in the preparation of the finsncial statements is appropriate. Based on the work we have perfonned, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's or the parent charitable companls abilty to continue as a going concern for a period of at least e1Ve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report, 26
Independent auditorfs report to the members of Azure Charitable Enterprises (continued) Other information The other infomation comprises the infomation included in the annual report other than the financial ststements and our auditorfs report thereon. The trUStS 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 fonn of assurance conclusion thereon. Our responsibility is to read the other infonnation and. in doing so. consider whether the other information is materially inconsistent with the financial ststements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identfy such material inconsistencies or apparent material misstatements, we are required to detennine vthether this gives rise to a material misstatement in the financial statements themselves. If. based on the work we have perfonned, we conclude that there is a material misstatement of this other infonnation, we are required to report that fact. We have nothing to report in this regard. Opinion on other matters prescribed by the Companles Act 2006 In our opinion, based on the work undertaken in the course of the audit.. the information given in the twstees, report including the strategic report for the financial year for which the financial statements are prepared is consistent with the financial statements. the trustees. report and the strategic report have been prepared in accordan with applicable legal requirements. Matters on which we are required to pOrt by exception In the light of our knowledge and understsnding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstalements in the trustees. report including the strategic report. We have nothing to report in respect of the following matters in relation to which Companies Act 2006 requires us to report to you if. in our opinion.. the parent charitable company has not kept adequate and sufficient accounting records, or returns adequate for our audit have not been received from branches not visited by us" or the parent charitable company financial statements are not in agreement with the accounting records and retums; or certain disclosures of trustees. remuneration specified by law are not made,. or we have not received all the infomiation and explanations we require for our audit. 27
Independent auditor's report to the members of Azure Charitable Entarprises {continued) Responsibilities of truste8S As explained more fully in the trustees. responsibilities statement, the truslees (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's and the parent charitable CoMpanS ability to continue as a going concern, disclosing, as applicable, matters related to going concem and using the going concern basis of accounting unless the trustees either intend to liquidate the group or the parent charitable company or to cease operations, or have no realistic alternative but to do so. Audltorfs responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misststernent, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAS (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users tsken on the basis of these financial statements. Irregularities, including fraud. are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: We identitied 8re85 of law and regulations that could reasonably be expected to have a material effect on the financial statements from our general and sector experience and through discussions with the trustees and other management (as required by Auditing Standards) and from inspection of the group's legal correspondence and we discussed with the trustees and other management the policies and procedures in place regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our audit team and remained alert to any indications of non-compliance throughout the audit. First, the group is Subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation), distributable profits 18gislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. Secondly. the group is subject to many other laws and regulations where the consequences of non<ompliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect- health and safety, safeguarding, employment law, data protection and certain aspects of company legislation. recognising the nature of the group's activities. Auditing Standards limit the required audit procedures to identrfy non-compliance with these laws and regulations to enquiry of the trustees and other management and inspection of regulatory and legal correspondence, if any. Through these procedures, we did not become aware of any actual or suspected non<ompliance material to the financial statements. 28
Independent auditor's r8POrt to the members of Azure Charitable Enterprises {continued) Because of the inherent limitations of an audit, there is a risk that we not detect all irregularities, including those leading to a material mi5Statement in the financial ststement5 or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional con¢ealment. ft)rgery, collusion. omission or misrepresentstion. A further description of our responsibilrties for the audit of the financial statements is located on the Financial Reporting Council's website at.. www.frc.or .uklauditorsres onsibilities. This description forms part of our auditorfs report. Uso of our report This report is made solely to the charitable companvs members. as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might slate to the charitable companvs members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent pemiitted by law, we do not accept or assume responsibility to anyone other than the charitable company and its members, as a body, for our audit work, for this report, or for the opinions v have formed. Andrew Wilson BA FCA (Senior Statutory Auditor) for and on behalf of UNW LLP, Statutory AudStor Chartered Accountants Newcastle upon Tyne 12 June 2024 29
Azure Charitable Enterprises (A company limited by guarantee Consolidated statement of financial activities (incorporating income and expenditure account) For the year ended 31 January 2024 As restated Total funds 2023 Unrestrlcted funds 2024 RestrScted funds 2024 Total funds 2024 Income from: Donations and legacies Charitsble activities Other trading activities 13.081 5,118,267 4.081.745 8.600 21.681 5,118.267 4,081.745 11,877 4,979,943 3.887,712 Total income 9.213,093 8,600 9,221,693 8,879,532 Expenditurè on: Raising fvnds Charitable activities 3,508,150 5,098.657 3,508,150 5,107.257 3,384,416 5,069,606 8.600 Total expenditure 8,606,807 8,600 8,615.407 8.454,022 Net movement in funds before other rocognisod gainsl{lossesl 606.286 606,286 425,510 Other recognlsed gainsl{losses): Loss on revaluation of investment property (302,486) Net movement in funds 606,286 606,286 123,024 Reconciliation of funds: Total funds brought forward Net movement in fvnds 4,784,273 606.286 4,784,273 606,286 4,661,249 123,024 Total funds carrled forward 19 5,390.559 5,390,5S9 4,784,273 The consolidated statement of financial activities includes all gains and losses recognised in the year. The notes on pages 34 to 52 fomi part of these financial statements. 30
Azure Charitable Enterprises (A company Ilmlted by guarantee) Consolidated balance sheet At 31 January 2024 As restated 2023 2024 Note Flxad assets Tangible assets Investment propety 13 14 2,5S3,247 995,000 2,349,830 995,000 3.548,247 3,344,830 Current ass•ts Stocks Debtors Cash at bank and in hand 16 17 440,694 512,319 1,712,216 494,783 702,400 993,024 2,665,229 2,190,207 Creditors: amounts falling due within one year 18 (822.917) {750,764) Net current assots 1,842,312 1,439,443 Total assets less current liabilities 5.390,559 4,784,273 Total net assets 5,390,559 4,784,273 Charlty funds Restricted funds Unrestricted funds 19 19 5,390,559 4,784,273 Total funds 5,390,559 4,784,273 The trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements. The financial statements were approved and authorised for issue by the trustees on 12 June 2024 and signed on their behalf by: G W Robson Treasurer & Vice Chainnan The notes on pages 34 to 52 form part of these financial statements. 31
Azure Charitable Enterprises IA company limited by guarantee Balance sheet At 31 January 2024 2024 2023 Nots Fixod assets Tangible assets Investments 13 15 2A16,552 2,202,125 2,416.554 2,202.127 Current as$ots Debtors Cash at bank and in hand 17 818,194 1,077,273 1,002,604 395,016 1,895,467 1,397,620 Creditors.. amounts falling due within one year 18 (963,665) (814,807) Net current assetsl{liabilities) 931,802 582,813 Total assets less current Ilabllltles 3,348,356 2,784.940 Total net assets 3,348,356 2,784,940 Charity funds Restricted funds Unrestricted funds 19 19 3,348,356 2,784.940 Total funds 3,348,356 2,784,940 The chaiivs net movement in funds for the year was £563,416 (2023 - £721,373). The trustees acknowledge their responsibilities for complying with the requirem8nts of the Act with rPect to accounting records and preparation of financial ststements. The financial statements were approved and authorised for issue by the trust88s on 12 June 2024 and signed on their behalf by. G W Robson Treasurer & Vice Chaimian Company registered number,, 01666027 The notes on pages 34 to 52 form part of these financial statements. 32
Azure Charitable Enterprises (A company limited by guarantee) Consolidated statement of cash flows For the year ended 31 January 2024 As restated 2023 2024 Note Cash flows from operating activities Net cash used in operating activities 21 1,115,423 97.473 Cash flows from investing activlties Purchase of tangible fixed assets (331,184) {94.471) Net cash used in investing activities (331,184) (94.471) Cash flows from flnanclng a¢tivitles Repayments of borrowing Repayments of finance leases (65,047) (86,729) (523) Net Cash used In flnancing activities {65,047) (87,252) Change in cash and cash equivalents in the year Cash and cash equivalents at the beginning of the year 719.192 {84,2SO) 1.077.274 993,024 Cash and cash equivalents at the end of the year 1,712.216 993,024 The notes on pages 34 to $2 fomi part of these financial statements 33
Azure Charitable Enterprises (A company limited by guarantee) Notes to the financial stst8ments For the year ended 31 January 2024 General information The charitable company is a company limited by guarantee. The members of the charitable company are the trustees named on page 1. In the event of the company being wound up, the liability in respect of the guarantee is limited to £1 per member of the company. Accounting policies 2.1 Basis of pr8paration of financial statements The financial statements have been prepared in accordance with the Charities SORP {FRS 102) - 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), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. A2ure Charitsble Enterprises 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. The consolidated statement of financial activities (SOFA) and con801idated balance sheet consolidate the financial statements of the charity and its subsidiary undertaking. The results of the subsidiary are consolidated on a line by line basis. The charity has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own statement of financial activities in th8se financial statements. 2.2 Prior year adjustment The propety held by the subsidiary Azure Business Centres Limf(ed has historically being classified as a tangible fixed asset, however, it is more appropriately classified as investment property. The property has been valued at £995,000 and appropriate adjustments have been made wilhin the financial statements to transfer the balance to investment property, correct the profit and loss reserve for depreciation previously charged. and to recognise a loss on revaluation. 2.3 Going concern The charity's forecasts 8nd projections for the next twelve months show that the group should be ab18 to continue in operational existence for that period, taking into account reasonable possible changes in trading perfomance. This also considers the effectiveness of available measures to assist in mitigating the impact. The charity and its trading subsidiaries have strong positive cash balances and is forecasting for this to continue to be the case. The trustees have stress tested their forecasts, taking into account various scenarios, and remain confident that the uncertainties do not cast significant doubt on the group's ability to continue as a going concern.
Azure Charitable Enterprises (A company Ilmlted by guarantee) Notes to the financial statements For the year ended 31 January 2024 Accountlng pollcies (continued) 2.4 Income All income is recognised once the charity has entrtlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliabFy. Income from government and other grants, whether 'capital' grants or 'revenue' grants, is recognised when the charity has entitlement to the funds. any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably and is not deferred. Income from commercial trading activities is recognised as earned (as the related goods and seniices are provided) and as the rental and Servi charges fall due. Interest receivable is recognised on a receivable basis, when Ihe amount can be measured reliably- this is nomally upon nolrfication of the interest paid or payable by the bank. Income from charitable activities includes income received under contract or where entitlement to grant funding is subject to specific performance conditions is recognised as earned (as the related goods or services are provided). Grant income included in this category provides funding to support client service activities and is recognised where there is entitlement, certainty of receipt and the amount can be measured with sufficient reliabilty. Income 1$ deferred when related grants are received and the perfomiance condrtions relating to its entitlement are not met. 2.5 Expenditure Expenditure is recognised once there is a legal or construdive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement and the amount of the obligation can be measured reliably. Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directty to that activity. Shared costs which contribute to more than one activty and support costs which are not attributable to a single activity are apportioned beeen those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges allocated on the portion of Ihe asset's use. Expendriure on raising funds includes all expendrture incurred by the group to raise funds for its charitable Purposes and includes costs of all fundraising a¢tivities events and non-charitable trading. Expenditure on charitable activrties is incurred on directly undertaking the activities which further the group'5 objectives. as well as any associated support cost5. All expenditure is inclusive of irrecoverable VAT. 35
Azure Charitable Enterprises (A company limited by guarantee Notes to the financial statsments For the year Qnded 31 January 2024 Accountlng pollcles {contlnued) 2.6 Tanglble flxed assets and depreciation Tangible fixed assets costing £500 or more are capitalised and recognised wh8n future economic benefits are probable and the cost or value of the asset can be measured reliabty. Tangible fixed assets are initialty recognised at cost. After recognition, under the cost model, tsngible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. All costs incurred to bring a tangible fixed asset into its intended working condition should be included in the measurement of cost. Depreciation is charged 50 as to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives, using the straight4ine method. Depreciation 13 provided on the following bases.. Freehold propety Long-tenn leasehold property Short-term leasehold property Plant and equipment Motor vehicles Fixtures and fittings Office equipment So years straight4ine or ov8r the lease temi 40 years straight-line or over the lease term 40 years straight-line or over the lease term 3 - 4 years straight-line 4 years straight4ine 3 - 5 years straight-line 3 - 5 years straight-line 2.7 Investment property Investment properties are measured at fair value at each reporting date, with any changes in fair value recognised in the profrt and loss account. Investment properties are not depreciated. 2.8 Investments Fixed asset investments are a form of financial instrument and are initially recognised at their transaction cost and subsequently measured at fair value at the balance sheet date, unless the value cannot be measured reliably in which se it is measured at cost less impairment, Investment gains and losses, whether realised or unrealised, are combined and presented as 'Gainsl(Losses) on investments, in the consolidated ststement of financial activities. Investsnents in subsidiaries are valued at cost less provision for impairment. 2.9 Stocks stocks are ststed at the l¢)wer of cost and net realisable value, being the estimated selling price less Costs to complete and sell. C08t is based on the Cost of purchase on a first in, first out basis. At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount 1$ reduced to its selling price less ¢osts to complete and sell. The impairment loss is recognised immediately in profrt or loss. 2.10 Cash at bank and in hand Cash at bank and in hand includes cash and short-term highly liquid investments with a short maturty of three months or less from the date of acquisition or opening of the deposit or similar account. 36
Azure Charitable Enterprises {A company Ilmitad by guarantee Notes to the financial statements For the year ended 31 January 2024 Accounting policies (continued) 2.11 Financial instruments The group only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method. 2.12 Operating leases Rentals paid under operating leases are charged to the consolidated statement of financial activities on a straight line basis over the lease tem. 2.13 Pènsions The group contributes to personal pension plans taken out by employees. Contributions are charged to the income and expenditure account as they become payable. 2.14 Fund accountlng General funds are unrestricted funds which are available for use at the discretion of the trustees in furtherance of the general objectives of the group and which have not been desbgnated for other purposes. Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the group for particular purposes. The costs of raising and administering such funds are charged against the specific fund. The aim and use of each restrided fund is set out in the notes to the financial stalernent5. Critical accounting estimates and areas of judgment Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Estimates included within these financial statements include depreciation charges, bad debt provisions and the stock provision. None of these estimates are considered to carry significant estimation uncertainty, nor to bear significant risk of causing a material adjustment to Carrying amounts of assets and liabilities within the next financial year. In preparing these financial statements the trustees do not consider there were any significant areas of judgment that were required in appSying the groups accounting policies as set out above. 37
Azure Charitable Enterprises (A Company Ilmlted by guarantee) Notes to the financial statements For the year ended 31 January 2024 Income from donatlons and legacles Unrestricted Restrlcted funds funds 2024 2024 Total funds 2024 Donations 13,081 8,600 21,681 Unrestricted funds 2023 Restricted funds 2023 Total funds 2023 Donations 8,277 3,600 11,877 Income from charitable activities Unrestricted funds 2024 Total funds 2024 Total funds 2023 Provision of client services 5,118,267 5.118,267 4,979,943 All income from charitable activities in the current and prior year was unrestricted. 38
Azure Charitable Enterprises (A company limited by guarantee Notes to the financial statements For the year ended 31 January 2024 Income from trading activities Income from non charitable tradlng actlvltles Unrestrlcted funds 2024 Total funds 2024 Total funds 2023 Subsidiary trading income Nursery income Landscapes income Feed in tariff income 3,623,576 42,333 414,749 1,087 3,623,S76 42,333 414,749 1,087 3,452,786 28,083 405,869 974 4,081,745 4.081.745 3,887,712 All income from trading activities in the current and prior year was unrestricted. Expenditure on raising funds Fundraislng trading expenses As r8Stated Total funds 2023 Unrostricted funds 2024 Total funds 2024 Cost of goods sold Rent and rates Advertising Heal, light and water Insurances Training Other Wages and salaries Depreciation 1,797,553 5,721 27,427 109,112 36,411 345 498,335 950,731 82,515 1,797,553 5,721 27,427 109,112 36,411 345 498,335 950,731 82,515 1,853,088 4,048 34,393 87,417 51,194 3,894 416,638 853,765 79,979 3,508,150 3,508,150 3,384,416 All expenditure from raising funds in the current and prior year was unrestricted. 39
Azure Charitable Enterprises (A company limited by guarantee) Notes to the financial statements For the year ended 31 January 2024 Analysis of expenditure on charitable actlvltles Summary by fund typo Unrestricted Restrlcted funds funds 2024 2024 Total funds 2024 Provision of charitable activities 5,098,657 8,600 5,107.257 Unrestricted funds 2023 Restricted funds 2023 Totsl funds 2023 Provision of charitable activities 5.066,006 3,600 5,069,806 Analysis of expenditure by activities Support costs 2024 Total funds 2024 Dlrect costs 2024 Provision of charitable activities 4.269,863 837,394 5,107,257 Support costs 2023 Total funds 2023 Direct costs 2023 Provision of charitable activbties 4,324,314 745,292 5,069,606 40
Azure Charitable Enterprises (A company limited by guarantee) Notss to the financial statements For the year ended 31 January 2024 Analysls of support costs 2024 2023 Employment costs Depreciation costs Interest Power Insurances Other Legal and other professional Costs Governance costs 564,694 27,968 1,696 35,974 26,192 98,029 10,1)01 72,840 484.145 26.456 2,538 27.125 2,136 69,350 67,947 65,595 837.394 745,292 10. Auditorfs remuneration 2024 2023 Fees payable to the charitys auditor for the audit of the charitls annual accounts 22.500 18.500 Fees payable to the charitls auditor in respect of: other services 2,350 1,500 41
Azure Charitable Enterprises (A company limited by guaranteel Notes to the financial statements For the year ended 31 January 2024 11. Staff costs Group 2024 Group 2023 Charlty 2024 Charty 2023 Wages and salaries Social security $1$ Contribution to defined contribution pension schemes 5,182,330 363,517 4,462,858 373,245 4,457,033 363,517 3,856,641 336,070 228,510 221,563 228,510 192.315 5,774,357 6,057,666 5,049,060 4,385.026 The average number of persons employed by the group during the year was as follows: Group 2024 Group 2023 No. Garden Centre Supported Living Landscapes Support Servi$ Employment SeNices Education Administration Azure Business Centres Limited 35 78 15 36 75 14 57 13 13 215 211 The number of employees whose employee benefts (excluding employer pension costs) exceeded £60,000 was.. Group 2024 No. Group 2023 No. In the band £60,001- £70,000 In the band £120,001- £130,000 In the band £140,001- £150.000 The key management personnel of the charity comprise the Chief Executive, Chief Financial Officer, Chief Operating Officer and Support Services Managers. The total employee benefits of the key management personnel of the group were £527,765 (2023.. £485,527). 12. Trustees. remuneration and expenses During the year, no trustees received any remun8Tation or other benefits (2023: none). 42
Azure Charitable Enterprises (A company limited by guarantee) Notes to the financial statements For the year ended 31 January 2024 12. Trustees. remuneration and expenses (continued During the year ended 31 January 2024, no trustee expenses have been incurred {2023: none). 13. Tangible fixed assets Group Propety (as Plant and raststed) machinery Assets Motor Office under vehicles equipment construction Total Cost At 1 February 2023 Additions 3.790.221 17,827 638.529 8.040 58,768 17.597 774.087 11,751 5,261,605 331,184 275,969 At 31 January 2024 3,808.IM8 646,569 76,365 785,838 275,969 5,592,789 Depreciation At 1 February 2023 Charge for the year 1,630.454 72,038 504,763 37,942 40.832 7.816 735,726 9,971 2.911.775 127.767 At 31 January 2024 1,702,492 542,705 48,648 745,697 3,039,542 Net book value At 31 January 2024 2,10S,556 103,864 27,717 40,141 275,969 2,553.247 At 31 January 2023 2,159,767 133,766 17,936 38,361 2,349,830 Included within the net book value of £2,553,247 is £nil (2023.. £nil) relating to assets held under hire purchase agreements. The depreciation charged to the financial statement in the year in respect of such assets amounted to £nil {2023.' £586). The net book value of freehold land not depreciated is £750,000. 43
Azure Charitable Enterprises (A company limited by guarantee} Notss to the financial ststements For the year ended 31 January 2024 13. Tanglble flxed apAets {contlnued Charity Assets Motor Office under vehicles equipment construction Freehold Plant and property machinery Total Cost At 1 February 2023 Additions 3,631,339 9,480 336,024 58.768 17.597 394,700 7.008 4,420,831 310,054 275,969 At 31 January 2024 3,640,819 336,024 76,365 401,708 27S,969 4,730,885 Depreciation At 1 February 2023 Charge for the year 1,504.394 70,018 317,142 8,105 40,832 7,816 356.338 9.688 2.218,706 95,627 At 31 January 2024 1,574,412 325,247 48,648 366,026 2,314,333 Net book value At 31 January 2024 2,066.407 10,777 27,717 35,682 275,969 2,416,552 At 31 January 2023 2,126,945 18,882 17,936 38,362 2,202,125 The net book value of freehold land not depreciated is £750,000.
Azure Charitable Enterprises (A company Ilmlted by guarantee) Notes to the financial statements For the year ended 31 January 2024 14. Investment property Group Freehold Investment property Valuation At 1 February 2023 (as reststed) 995.000 At 31 January 2024 995.000 Investment properties are held in Azure Business Centres Limrted and were subject to an external valuation in 2023 by Sanderson Weatherall. The valuations were prepared on the basis of open market value and were made in accordance with RICS Valuation - Global Standards 2022. These valuation5 have been updated by the directors to 31 January 2024. Investrnent property if included on a historical cost basis would be stated at: Group 2024 Group 2023 Historic cost 1,297,486 1,297,486 45
Azure Charitable Enterprises IA company limited by guarantee) Notes to the financial statements For the year ended 31 January 2024 15. Fixed asset inv•stments Investments in subsidiary companies Company Cost At 1 February 2023 At 31 January 2024 Net book value At 31 January 2024 At 31 January 2023 Principal Subsidiaries The following were subsidiary undert8king$ of the charity.. Names Company Country of number Incorporation Class of Holding shares Azure Garden Centre Limited Azure Business Centres Limited 02746143 England 04642254 England Ordinary NIA 1000/0 Azure Business Centres Limited is a private company limited by guarantee without share capital and therefore no shares are held by Azure Chariiable Enterprises. The financial results of the subsidiaries for the year were: Names Income Expenditure Profit for the year Net assets Azure Garden Centre Limited Azure Business Centres Limited 3,526,122 183,549 3,027.625 139.298 498N97 44,250 710.974 1,331,27S
Azure Charitable Enterprises (A company limited by guarantee} Notes to the financlal ststements For the year ended 31 January 2024 16. Stocks Group 2024 Group 2023 Finished goods and goods for resale 440,694 494.783 17. Debtors Group 2024 Group 2023 Charlty 2024 Charity 2023 Trade debtors Amounts owed by group undertakings Other debtors Prepayments and accrued income 154.239 249,520 113,117 369,059 1,144 334,874 215,041 349,592 418 437,553 3,134 354.946 418 452,462 512.319 702,400 818,194 1,002,604 The amounts owed by group undertakings are unsecured and repayable on demand. 47
Azure Charitable Enterprises (A company limited by guarantee) Notes to the financial ststements For the year ended 31 January 2024 18. cditOrs. amount5 falling due within one year Group 2024 Group 2023 Charity 2024 Charity 2023 Bank loans Trade creditors Amounts owed to group undertakinss Other taxation and social security Other creditors Accruals and deferred income 65,047 248,028 65,047 181,242 318,036 140,722 80 109,680 194,655 101,054 306,558 329,301 49,096 177,656 340.140 60,644 227,478 277,019 10,922 149,748 822,917 750,764 963,665 814,807 The amounts owed to group undertakings are unsecured and repayable on demand. The bank loan was secured by legal charges on land occupied by the garden centre at Station Road, Cramlington. Orginally the mortgage was repayable over 20 years (the original start date was 5th October 2005), by way of quarterly instalments. The mortgage was arranged in three parts, the first part at a fixed interest rate was fully repaid during the year ended January 2019. The remaining two parts of the loan were consolidated into one in October 2021 and this outstanding loan incurred interest at a commercial rate. The loan was fully repaid in October 2023. Deferred income Group 2024 Group 2023 Charity 2024 Charity 2023 Deferred income at 1 February 2023 Resources deferred during the year Amounts released from previous periods 92,404 92,404 47,910 47,910 (92,404) (92,404) Doferred income at 31 January 2024 47,910 47,910
Azure Charitable Enterprises (A ¢ompany limited by guarantee) Notes to the financial statsments For the year ended 31 January 2024 19. Statement of funds Statoment of funds - current year Balance at 1 February 2023 Balance at 31 January 2024 Income Expenditure Unrestricted funds General fvnds 4.784,273 9,213,093 (8.606.807) 5.390.559 Restricted funds Residents activities for Keele Drive 8,600 18,600) Total of funds 4,784,273 9.221,693 (8.615,4071 5.390,559 ststement of funds - prior year As reststed Balance at 1 Febwary 2022 Balance at Gainsl 31 January (Losses) 2023 As restated Income Expenditure Unrestricted funds General funds 4.661,249 8,875,932 (8,450.422) (302,486) 4.784.273 Restiicted funds Residents activities for Keele Drive 3,600 (3,600) Total of funds 4,661,249 8,879,532 (8,454,022) (302,486) 4,784.273 Residents activities for Keele DrNe: Various donations were received from Damant ML during the year towards the cost of providing social activities for the residents of Keele Drive. 49
Azure Charitable Enterprises (A company limited by guarantee) Notes to the financial statements For the year ended 31 January 2024 20. Analysis of net assets between funds Analysis of net assets between funds- current year Unr•strieted funds 2024 Total funds 2024 Tangible fixed assets Investrnent propety Current assets Creditors due within one year 2,553,247 2.553,247 995,000 995,000 2,665,229 2,665,229 (822,917) (822.917) Total 5,390,559 5.390,S59 21. Reconciliation of net movement in funds to net cash flow from operating activiti•s Group Group As restated 2024 2023 Net income for the year (as per statement of financial acttvities) 606,286 425,510 Adjustm•nts for: Depreciation charges Decrease in stocks Decreasel(increase) in debtors Increasel(decrease) in creditors 127.767 54.089 190.081 137,200 117,249 424 (127,115) (318,595) Nat eash provlded by operatlng actlvlties 1.115,423 97,473 22. Analysis of cash and cash •quivalents Group 2024 Group 2023 Cash in hand 1,712.216 993,024 Total cash and cash equivalents 1,712,216 993,024 50
Azure Charitable Enterprises (A company Ilmitsd by guarantee) Notes to the financial statements For the year ènded 31 January 2024 23. Analys1$ of changes in net debt At1 February 2023 Cash flows At31 January 2024 Cash at bank and in hand Debt due within 1 year 993,024 (65,047) 719,192 65.047 1,712,216 927,977 784,239 1,712.216 24. Capital commitments Group 2024 Group 2023 Charity 2024 Charity 2023 Contracted for but not provlded in these financial statèments Acquisition of tangible fixed assets 205,700 205,700 25. Pension commllments The group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £228,510 (2023.. £221,563). Contributions totalling £36,708 {2023: £32,772) were payable to the fund at the balance sheet date and are included in creditors. 26. Operating lease commitments At 31 January 2024 the group and the charity had commitments to make future minimum lease payments under non•cancellable operating leases as follows.. Group 2024 Group 2023 Charlty 2024 Charity 2023 Not later than 1 year Later than 1 year and not later than 5 years 10,940 1,101 12,910 17,488 10,940 1,101 12,910 17,488 12,IM1 30,398 12.041 30,398 51
Azure CharÉtable Enterprises (A company Ilmlted by guarantee) Not8S to the financial statements For the year ended 31 January 2024 Related party transactions During the course of the year, the Gharity purchased goods from its subsidiary Azure Garden Centre Limited amounting to £4,747 {2023.. £5.642) on nomial commercial terms. During the course of the year, the charity provided management services to P2ure Garden Centre Limited amounting to £172,348 (2023. £150,915). During the year there were also recharges of costs between the charity and Azure Garden Centre Limited. The amount outstanding at the year*nd included in the charitable company's debtors is £356,624 (2023.. £348,261). During the course of the year, the charity purchased goods from its subsidiary Azure Business Centres Limited amounting to £14,268 (2023.. £16,447) on normal commercial terms. During the course of the year, the charity sold goods to its subsidiary Azure Business Centres Limited amounting to £815 (2023: £TT4) on normal commercial temis. During the course of the year the Charity provided management services to Azure Business Centres Limited amounting to £9.660 (2023.. £8,557} on nomial commercial terms. During the year there were also recharges of costs btheen the charity and Azure Garden Centre Limited. The amount outstanding at the year end, included in the charitable company's creditors is £294,123 {2023.' £316,291). During the course of the year the charty sold goods to l Hindle, a trustee, tolalling £10,261 (2023= £8,256) on normal commercial terms. The amount outstanding at the year end, included in the charitable company's debtors, is £1,843 {2023: £1,152). During the course of the year the charty purchased ServIS from Muckle LLP, a company where RJ Adams is a partner, totalling £2,880 (2023.. £3.150). on noal commercial terms. The amount outstanding at the yearend, included in the charitable companws creditors, is £nil (£2023.. £nil). 28. Controlling party In the opinion of the trustees there is no ultimate controlling party, other than the trustees themselves. 52